Karoon Energy Ltd · ASX:KAR
Karoon Energy — Shareholder Meeting (November 2021)
36 slides from Karoon Energy's shareholder meeting presentation, Nov 26, 2021
Slide 1: ASX cover letter: 2021 AGM address and presentation
26 November 2021 Company Announcements Office ASX Limited Dear Sir / Madam Karoon Energy Ltd 2021 Annual General Meeting – Address by Chairman and Presentation In accordance with ASX Listing Rule 3.13.3, enclosed are the Chairman’s address and a presentation to be delivered at Karoon Energy Ltd’s 20
Slide 2: Chairman's address
ASX RELEASE Issued 26 November 2021 Chairman’s address Good morning ladies and gentlemen. The 2021 financial year (FY21) was one of the most significant in Karoon’s 17-year history. With the global Covid pandemic in full flight, the Company renegotiated and completed the acquisition of the Baúna oil
Slide 3: Evolution and delivery of strategy
During FY21 the Baúna transaction was completed and the board sanctioned investments in both of the associated organic-field projects. These projects remain on track to commence production in mid-2022 and early-2023 respectively; 2. Secondly, in the medium term, to advance growth opportunities. In t
Slide 4: Building the team and processes to deliver the strategy
Building the team and processes to deliver the strategy Making the transition from an exploration to an operating production company is a major transformational step for any organisation. During FY21, several changes were made to Karoon’s Board, management and corporate structures, to ensure we have
Slide 5: Strong financial position
The reduction in the upfront payment, combined with strong cash flows from operations since completion of the purchase, has left the Company in a strong financial position, with cash of US$175 million and no debt as at the end of September 2021. Our capital commitments for the Baúna intervention pro
Slide 6: Remuneration outcomes
• The company did not take any government salary subsidies during the pandemic; • Based on the Company’s significant operational progress, and in achieving most of Karoon’s strategic targets set at the beginning of FY21, 61.5% of the possible Short-Term Incentive (‘STI’) outcome vested (subject to t
Slide 7: Conclusion
Good progress has been made on planning and preparations for the Baúna intervention program and the Patola development with more than 70% of contracts by value now executed. We expect that almost all of the remaining contracts will be executed by the time of the release of our half year results at w
Slide 8: Karoon aims to be an agile and sustainable global energy company
Karoon aims to be an agile and sustainable global energy company delivering profits through a high- quality portfolio of production, development and exploration assets. The Company seeks to provide energy to an ever-changing world, creating value for our shareholders and the broader community. Forwa
Slide 9: Karoon Energy 2021 AGM Presentation
Karoon Energy 2021 AGM Presentation 26 November 2021 1
Slide 10: Disclaimer
Disclaimer Disclaimer This presentation has been prepared by Karoon Energy Ltd. The information contained in this presentation is for information purposes only and does not constitute an offer to issue, or arrange to issue, securities or other financial products. The information contained in this pr
Slide 11: Online attendees – text question process
ONLINE ATTENDEES – TEXT QUESTION PROCESS 123-456-789 When the question function is available, the messaging tab will appear at the top of the screen To submit a question, type your question in the “Ask a question” box and press the send arrow Your question will be sent immediately for review Receive
Slide 12: Online attendees – audio question process
ONLINE ATTENDEES – AUDIO QUESTION PROCESS 123-456-789 When the audio questions line is available, a link will appear on the home tab titled Asking Audio Questions If you would like to ask an audio question, pause the meeting broadcast and click on the link You will be prompted to enter your name and
Slide 13: Online attendees – voting
ONLINE ATTENDEES – VOTING 123-456-789 When open, the vote will be accessible by selecting the voting tab at the top of the screen To vote simply select the direction in which you would like to cast your vote. The selected option will change colour For Against Abstain There is no submit or send butto
Slide 14: Introduction
Introduction Independent, Non-executive Directors Bruce Phillips Peter Turnbull Clark Davey Luciana Rachid Peter Botten Management Julian Fowles Ray Church Antonio Guimarães Nick Kennedy 6
Slide 15: Meeting Agenda
Meeting Agenda 1. Chairman’s Address 2. Management Presentation 3. Discussion of Resolutions 4. Financial Statements and Reports 5. Meeting close 7
Slide 16: Chairman's Address
Chairman’s Address Bruce Phillips 8
Slide 17: Building Karoon's Future
Building Karoon’s Future Julian Fowles Managing Director and CEO 9
Slide 18: Karoon has entered a new era as a producer
Karoon has entered a new era as a producer Key strategic milestones achieved over FY2021 Fundamental change from explorer to producer Operational delivery ▪ Executed transition of Baúna operations from previous operator ▪ Delivered safe and reliable production and operations ◦ No material safety inc
Slide 19: Strategic Context
Strategic Context Karoon well positioned to capture emerging oil opportunities Oil industry dynamics Upstream capex fell 40% during 2014–19 ▪ Crude oil demand supported to at least 2035 In 2020, it declined another 30%1 ▪ Many years of underinvestment have led to structural undersupply, supporting G
Slide 20: Optimising Brazilian Production
Optimising Brazilian Production Antonio Guimarães Executive Vice President and President Karoon Brazil 12
Slide 21: Baúna: Karoon's anchor asset in Brazil
Baúna: Karoon’s anchor asset in Brazil High quality producing field with excellent sub-surface characteristics ▪ Baúna came onstream in 2013 Seismic derived 3D models used for field management and development planning ▪ Production peaked at 70,000 bopd, >135 MMbbl produced to date ▪ Karoon acquired
Slide 22: Maximising value of Baúna
Maximising value of Baúna Focus on high operational uptime and active field management Process safety, facility integrity & preventive maintenance FPSO – Monthly Uptime 2021 • Minimising unplanned shutdowns and downtime due to equipment 100% 100.0% 100.0% 99.7% 99.5% 90% 98.4% 98.4% failure 96.5% 96
Slide 23: Baúna interventions and Patola development on track
Baúna interventions and Patola development on track* Forecast to more than double current production to >30,000 bopd in early CY2023 Baúna well intervention project Patola Development ▪ Targeting 5,000 – 10,000 bopd incremental production ▪ Targeting first Patola production in early CY2023 ▪ Expecte
Slide 24: Indicative production and cost profile
Indicative production and cost profile* Sanctioned projects targeting material production increase and opex/bbl reduction Indicative Production Profile (MMbbl)* Indicative Unit Operating Cost Outlook (US$/bbl)* 8 - 10 28 - 32 25 12 - 18 4.2 – 4.6 3.14 FY21A FY22 FY23 FY21A FY22 FY23 Deliver BM-S-40
Slide 25: Growth Opportunities and Sustainability
Growth Opportunities and Sustainability Julian Fowles Managing Director and CEO 17
Slide 26: Potential Neon hub development
Potential Neon hub development Within Karoon’s Southern Santos heartland Great address Karoon portfolio Subsurface Characteristics Goiá Neon Baúna 50km 50km Clorita Brazilian offshore oil basin schematic cross-section ▪ Brazilian offshore basins world renowned for “Super Basin” scale prospectivity ▪
Slide 27: Maximise potential value of Neon Oil Field
Maximise potential value of Neon Oil Field Alternative development concepts being explored ▪ Neon oil field discovered by Echidna-1 exploration well in 2015, located 60km NE Field Contingent Resources1 of Baúna 1C 2C 3C (MMbbl) (MMbbl) (MMbbl) ▪ Contains high quality 39º API light oil. Strong produc
Slide 28: Using Karoon's technical and commercial skills for M&A
Using Karoon’s technical and commercial skills for M&A Actively assessing inorganic growth options through a disciplined process ▪ Karoon actively screening for inorganic growth opportunities ▪ Petrobras divestment process well-established, with motivated seller ▪ High-quality conventional E&P asset
Slide 29: Karoon's five pillars of sustainability
Karoon’s five pillars of sustainability Underpinned by oversight from Board Sustainability and Operational Risk Committee ▪ Safety is our first priority HSE ▪ Working closely with FPSO operator to improve already strong safety record, >3.5 years without a Lost Time Incident ▪ Carbon management core
Slide 30: Carbon Management Action Plan – Carbon Neutral in FY2022
Carbon Management Action Plan – Carbon Neutral in FY2022 As a new oil producer, Karoon has opportunity to achieve meaningful emissions targets To be Carbon Neutral on Baúna-Patola1 FY21 Carbon onwards Net Zero Neutral 2 Carbon Neutral on new assets within five years of purchase1 2035 3 FY 2022 Inter
Slide 31: Funding and capital priorities
Funding and capital priorities Ray Church Executive Vice President and CFO 23
Slide 32: Strong and improving cash position
Strong and improving cash position Consistent Baúna production delivering strong cash flow foundation ▪ Current Baúna production provides solid foundation for growth Quarterly Revenue v Realised Oil Price per bbl ▪ In FY21, generated oil revenues of US$171 million (eight months of production) at ave
Slide 33: Priority uses of capital
Priority uses of capital Deliver safe and reliable operations ▪ Deliver production from on-going operations ▪ Investment in maintenance to maximise life of facilities ▪ Ensure long term sustainability Build and maintain strong, flexible Order of Priority ▪ Meet debt obligations and covenants balance
Slide 34: Summary
Summary Julian Fowles Managing Director and CEO 26
Slide 35: Summary
Summary Pure oil play with exposure to exciting Brazilian oil industry and clear growth path Successful transition from explorer to oil producer following acquisition of Baúna ▪ One of the only companies with pure oil exposure listed on the ASX ▪ 100% owner/operator of a high-quality asset, deliveri
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