Tamar Petroleum Ltd. · TASE:TMRP
Tamar Petroleum — Investor Presentation (February 2018)
32 slides from Tamar Petroleum's investor presentation, February 2018
Slide 1: Tamar Petroleum Investors Presentation February 2018
Tamar Petroleum Investors Presentation February 2018
Slide 2: Limitation of Liability
Limitation of Liability This presentation was prepared by Tamar Petroleum Ltd. (the “Company”) and is given only for the provision of summary information for the sake of convenience. This Presentation does not purport to be comprehensive or to include all of the information which might be relevant w
Slide 3: Tamar Petroleum Identity Card
Tamar Petroleum Identity Card • Tamar Petroleum is a yield company with no control core, traded on the Tel Aviv Stock Exchange • Tamar Petroleum holds 9.25% of the rights in the Tamar and Dalit Leases, and after the consummation of the transaction with Noble Energy Mediterranean Ltd. (“Noble”), Tama
Slide 4: Tamar Petroleum Management
Tamar Petroleum Management Liami Vaisman |CEO Started his path as an energy specialist and thereafter as an energy coordinator at the Ministry of Finance and continued as the CFO for the Governmental gas transmission company Israel Natural Gas Lines Ltd. (INGL). Vaisman served as a partner and head
Slide 5: Tamar Petroleum Noble Transaction Highlights
Tamar Petroleum Noble Transaction Highlights • According to the provisions of the Gas Framework, Noble is obligated to reduce its holdings in the Tamar and Dalit Leases from 32.5% to 25% until December 2021. • Under an agreement executed between Tamar Petroleum and Noble, Tamar Petroleum will purcha
Slide 6: Tamar Petroleum Structure of Holdings
Tamar Petroleum Structure of Holdings Immediately after the transaction Public Delek Noble Drilling 43.5% 0% 33.9% 88% 22.6% 12% תמר Tamar Petroleum Rate of holding in Tamar Petroleum Capital Rate of holding in shares conferring voting rights in Tamar Petroleum Tamar Petroleum 6
Slide 7: The transaction improves the status of the Company and its shareholders
The transaction improves the status of the Company and its shareholders • Improvement of the return for shareholders in every scenario – without exposure to a specified price or market prices • Purchase of a better flow from the reservoir – without paying overriding royalties – at an improved price
Slide 8: Comprehensive income proforma for 9 months
Comprehensive income proforma for 9 months Ended on September 30, 2017 1-9.2017 // in Dollars in thousands (excluding number of shares and figure per share) Proforma figures Proforma Adjustments Figures before proforma adjustments* 239,882 107,410 132,472 Revenues from the sale of natural gas and co
Slide 9: High quality reservoir on a global level
High quality reservoir on a global level The development system was built in a manner which creates redundancy and backup in the system, stable production and flow for many years, Uptime of approx. 99.7% Tamar Petroleum 9
Slide 10: Tamar Reservoir Basic Data
Tamar Reservoir Basic Data Reserves as of December 31, 2017 (2P, Tamar and Tamar SW Reservoirs) Approx. 11 tcf (313 BCM) and in addition approx. 14.4 million condensate barrels Piping commencement date March 31, 2013 Tamar production system chart Initial Development Budget Approx. $3.1 billion (100%
Slide 11: Proven Reserves in a high quality reservoir
Proven Reserves in a high quality reservoir Reserves as of December 31, 2017 (BCF)* Proved reserves (1P) Probable reserves Tamar SW • High quality reservoir on a global level: Dry gas, approx. 99% Methane, high porosity and 12,000 3,222 11,058 permeability level, high connectivity between the sectio
Slide 12: Stability in Revenues and Cash Flow
Stability in Revenues and Cash Flow As a result of long-term contracts and low operation costs Gross revenues (100% - $million) 2,000 1.6% 9.2% 6.6% 1,500 • Increase in revenues as a result of constant 1,000 $1,863 increase in demand $1,577 $1,601 $1,749 500 • Most of the contracts are long-term 0 F
Slide 13: Sales Distribution actual and future
Sales Distribution actual and future • Quantities – minimum quantities in contracts (Take or Pay) • Prices – linkage to CPI and bottom prices (according to the type of agreement) Sales distribution forecast: 2022 Actual sales distribution: 2017 Jordan Jordan and other export Industry and 11% distrib
Slide 14: Natural Gas Consumption in the Israeli market
Natural Gas Consumption in the Israeli market Natural gas consumption in Israel in the years 2004-2017 (BCM) Yam Tethys EMG LNG Tamar 12 10.4 10 9.7 18% average annual growth 8.4 8 7.6 6.9 Tamar’s entrance 6 5.3 5 4.2 3.8 4 shortage in natural gas 2.7 2.6 2.3 2 1.6 1.2 0 2004 2005 2006 2007 2008 200
Slide 15: Growth engines in natural gas demand increase
Growth engines in natural gas demand increase The Ministers of Energy and Environment: coal burning for electricity “we will take Israel completely off the habit of production will be reduced by 30% using petrol until 2030” The ministers Steinitz and Elkin announced that the reduction will be effect
Slide 16: Growth Engines in natural gas demand increase
Growth Engines in natural gas demand increase 10.4 BCM Actual Demand in 2017 4.2 • Affected mainly by increase in the population, increase in free income and increase in standard Increase in electricity BCM of living, as well as the increase in the uses for electricity and energy-intensive systems d
Slide 17: Forecast of the demand for natural gas in the Israeli market
Forecast of the demand for natural gas in the Israeli market // Long-term Growth • The energy sector is undergoing a dramatic structural change deriving from a change of the BCM fuel mix leading to an increase of the Economy’s relative advantage 25.0 23.7 • The main increase in demand for natural ga
Slide 18: Reduction of the use of coal increase in the demand for natural gas
Reduction of the use of coal increase in the demand for natural gas • The coal consumption in the electricity market sector (as of 2017) is equal to the consumption of natural gas in the amount of approx. 5BCM per year • Assuming full production in natural gas with no coal, the gas consumption in th
Slide 19: Reduction of the use of coal
Reduction of the use of coal //economic analysis from the point of view of the electricity sector and the point of view of the market Coal Natural Gas Natural Gas Fuel Cost ($/MMBTU) $4.6 $5.34 ($80/tone+$30 BLO( ($5.24+0.1$ BLO) Energy Efficiency 39% 58% Cost to Electricity Producer 4.5 3.6 Cent/kW
Slide 20: Tamar Sales with respect to the demand and supply in the market
Tamar Sales with respect to the demand and supply in the market //Israel and Jordan 30.0 25.0 20.0 BCMa 15.0 10.0 5.0 - 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Tamar Sales Leviathan/Karish and Tanin LNG/Unsupplied demand Supply to Jordan Sales to Jordan according to 3.5BCM p
Slide 21: Clear strategy for the extraction of value from the reservoir
Clear strategy for the extraction of value from the reservoir • Identification and mapping of deep Exploration potential targets within the Tamar Lease area • Expansion of the Tamar project for supply to the Expansion of output increasing demand in the local market and/or export • Continued promotio
Slide 22: Exhaustion of the local sales potential
Exhaustion of the local sales potential • Jordan constitutes a market of approx. 5-6BCM per year with no own resources (Tamar already exports natural gas to customers in Jordan) • Egypt is a market with comprehensive demand of over 80BCM per year which is not fully provided through own sources, aimi
Slide 23: Potential of Sales to the Jordanian Market
Potential of Sales to the Jordanian Market • The Jordanian market is anticipated to consume in 2020 more than 5BCM, with the vast majority of the demand coming from the electricity sector • The Jordanian electricity market sector relies completely on natural gas. In 2017, approx. 19 TWh were produce
Slide 24: Potential of Sales to the Egyptian Market
Potential of Sales to the Egyptian Market • Demand for natural gas in the Egyptian market in 2020 is anticipated to be approx. 83BCM, out of which approx. 65BCM in the local market and approx. 18BCM in the existing liquefaction plants • In recent years, due to shortage, the use of natural gas has be
Slide 25: The Levantine Basin Exploration Potential
The Levantine Basin Exploration Potential Deep prospective targets in Leviathan which are estimated by NSAI in 560 million oil barrels and 4.5TCF natural gas, could affect the potential for the finding of additional oil and gas at the Tamar and Dalit Leases Leviathan Deep Source: Noble Energy Tamar
Slide 26: Tamar Reservoir Production and expenses profile
Tamar Reservoir Production and expenses profile Anticipated profile 2P production from the reservoir – (BCM) 12 10 • The production is anticipated to 8 continue growing and to stabilize 6 on a fixed level at an annual 4 scope of 10.65BCM per year for 2 approx. 20 years 0 2017 2018 2019 2020 2021 202
Slide 27: Projected cash flow after completion of the transaction
Projected cash flow after completion of the transaction //Tamar Petroleum – Noble Projected cash flow (without financing) – Tamar Petroleum, approx. 16.75% of the rights in the Tamar Reservoir (unlevered free cash flows mm$) Commencement of tax Drilling and payments pursuant to connection of the Pet
Slide 28: Coverage ratio (ADSCR) Company Debt Scenario after the transaction
Coverage ratio (ADSCR) Company Debt Scenario after the transaction 1.7 1.6 • Average ADSCR : 1.46 1.5 • Minimal ADSCR: 1.40 1.4 1.3 1.2 1.1 1 • Based on sales forecast of 10BCM per year commencing in 2020 • The average coverage ratio according to the DCF: 1.53 • The minimal coverage ratio according
Slide 29: The cash flow Tamar Petroleum after the transaction
The cash flow Tamar Petroleum after the transaction Revenues • Revenues of 16.75% of the total revenues of the Tamar Reservoir – Royalties • Royalties to the State* at a rate of 12.5% wellhead revenues, in addition to overriding royalties at a rate of approx. 5.48% – Operational expenses • Operation
Slide 30: Issuance Structure B Bonds
Issuance Structure B Bonds Debt Issuance Amount of rated debt $560 million Channel Dollar linked Interest payment Twice a year in the end of every February and August between the years 2018-2028 commencing from August 2018 until August 2028 21 different principal payments derived from the cashflow o
Slide 31: Collateral and Financial Covenants
Collateral and Financial Covenants Midroog determines an A1.il (P) Rating1 with a stable outlook for the senior debt (Series B) to be raised by Tamar Petroleum Ltd. In an amount of up to approx. $560 million. • Until 2022: an amount equal at any time to 3 months of debt service Debt service reserve
Slide 32: Thank You
Thank You
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