Carnarvon Energy Limited · ASX:CVN
Carnarvon Energy — Carnarvon Petroleum — Shareholder Meeting (November 2011)
24 slides from Carnarvon Energy's shareholder meeting presentation, Nov 18, 2011
Slide 1: Annual General Meeting
Annual General Meeting 18 November 2011
Slide 2: Contents
Contents 1) Introduction 2) Overview of 2011 financial year (“FY”) 3) Production activities and plans 4) Other value drivers 5) Key priorities in 2012 6) Conclusion and questions 2
Slide 3: Introduction: asset portfolio and company ownership
Introduction Asset portfolio High equity interests 10 million acres In three countries Company ownership 19% held by institutional shareholders 11% held by directors and management No significant holdings (namely over 5%) 3
Slide 4: Introduction: 2011 FY activities
Introduction 2011 FY activities Produced 731,544 bbls Drilled 2 wells in L20/50 Drilled the Tuatara well, New Zealand Drilled 22 wells in L44/43 & L33/43 Acquired seismic in Thailand, Indonesia & Australia • 1,290 km of 2D seismic • 1,160 km2 of 3D seismic 4
Slide 5: 2011 FY overview
2011 FY overview 2011 FY 2010 FY Earnings summary ($’m) ($’m) Oil sales $55m $64m Oil price steady Cost of sales (“CoS”) ($19m) ($21m) Production down 16% Administrative costs ($5m) ($5m) CoS carried capacity Unrealised foreign ($4.5m) ($0.5m) for higher production exchange losses A$ strengt
Slide 6: 2011 FY overview: cash flow summary
2011 FY overview Cash flow summary 2011 FY 2010 FY ($’m) ($’m) Oil receipts impacted by Oil receipts $62m $71m production Payments to ($24m) ($24m) Field costs steady on suppliers & retained capacity for employees higher production Taxes ($15m) ($15m) Tax payments include Operating cash $23m $
Slide 7: 2011 FY overview: cash flow summary (cont.)
2011 FY overview Cash flow summary (cont.) 2011 FY 2010 FY ($’m) ($’m) L44 Exploration OCF $23m $32m 22 wells, inventory and (from previous page) development costs L44 exploration ($20m) ($29m) Other Exploration and development Two L20/50 wells (Thailand) Other exploration ($14m) ($5m) Tuatara
Slide 8: Positives of onshore Thailand
Production activities and plans Positives of onshore Thailand Hydrocarbons present Low operating costs Low cost drilling Easily scalable operations World class operating environment Stable fiscal terms High margin operations (500 bopd well pays back in ~ one month) 8
Slide 9: Natural field decline (NFD)
Production activities and plans Natural field decline (“NFD”) Wells are impacted by NFD & subsequent water incursion Water flows preferentially to oil thereby accelerating NFD JV has a history of successfully replacing NFD 2011 drilling in the WBEXT area didn’t replicate this history Carnarv
Slide 10: WBEXT focus in FY 2011
Production activities and plans WBEXT focus in FY 2011 In 2011 nearly 2/3 thirds of rig time was in the WBEXT region Why - 3 wells flowed between 3,500 & 5,300 bopd Two more wells in the north flowed at 1,100 & 2,300 bopd Discovered and appraised new sandstone oil field New technologies ha
Slide 11: Forward Plans
Production activities and plans Forward Plans Sandstone – greater stability and longevity Drill 10-15 WBEXT dedicated sandstone wells Wells expected to produce ~100 to 300 bopd gross Preparing to commence development in Q1 of 2012 Volcanic – high flow, fast payback, high variability Systemat
Slide 12: L20/50 asset – Thailand
Other value drivers L20/50 asset – Thailand 3D seismic required to better delineate fault terraces Complex faulting on basin margin: good potential for structural closures W E Migration from depocentre 2 wells drilled in 2011 achieved their minimum objectives Identifying reservoir and source M
Slide 13: L20/50 Concession - Thailand
Other value drivers L20/50 Concession - Thailand The time line above is indicative only 13
Slide 14: L52/50 & L53/50 asset – Thailand
Other value drivers L52/50 & L53/50 asset – Thailand Early stage exploration Close proximity to prolific offshore basins in the Gulf of Thailand Under-explored basin With few valid well tests Surface geological and structural mapping completed in 2010 Currently acquiring new 2D seismic to
Slide 15: L52/53 & L53/50 Concessions - Thailand
Other value drivers L52/53 & L53/50 Concessions - Thailand The time line is indicative only 15
Slide 16: Rangkas PSC – Indonesia
Other value drivers Rangkas PSC – Indonesia Valid traps + good source + multiple staked play types Pertamina discovered oil nearby (2007-10), flowed up to 3,000bopd 500 km Rangkas 2D seismic acquisition completed on 1 April 2011 Geophysical mapping has identified some 15 significant leads 16
Slide 17: Rangkas PSC - Indonesia
Other value drivers Rangkas PSC - Indonesia 17
Slide 18: Phoenix asset – Western Australia
Other value drivers Phoenix asset – Western Australia material interests + large acreage + discovered gas Prospects of ~2.5 Tcf (recoverable gas) The “Phoenix” asset refers to Carnarvon’s Water depths of ~140m 50% interest in the WA-435-P, WA-436-P, WA-437-P and WA-438-P Permits and its Well d
Slide 19: Phoenix asset – 3D seismic
Other value drivers Phoenix asset – Western Australia 3D seismic clearly showing key structures 19
Slide 20: Phoenix asset – Maximise shareholder value
Other value drivers in the business Phoenix asset – Maximise shareholder value Maximise Value Explore and Other Develop Options Asset Domestic Liquids LNG Feed Domestic Asset LNG Project realisation Gas Stripping Supply Gas Swaps Swaps (all or part) • Strong interest in farmout • Huge potential incl
Slide 21: Phoenix asset – Western Australia
Other value drivers Phoenix asset – Western Australia The “Phoenix” asset refers to Carnarvon’s 50% interest in the WA-435-P, WA-436-P, WA-437-P and WA-438-P Permits and its 100% interest in the WA-443-P Permit The time line above is indicative only 21
Slide 22: Key priorities in 2012 CY
Key priorities in 2012 CY 1. Drill 10-15 sandstone reservoir wells (Thailand) Objective – increase the level of stable production 2. Trial new production technologies (Thailand) Objective - improve production & reduce volatility 3. Drill high impact volcanic reservoir wells (Thailand) Objectiv
Slide 23: Conclusion and Questions
Conclusion and Questions Phoenix 2012 Increasing regional focus (eg: WPL) Buoyant LNG & domgas markets New 3D data Discovered gas Potential Value L44 Phoenix L44 Volcanic 2009 Volcanic with Entry 2010 Technology L44 Sandstone Development Plan & Production 2012 L44 Volcanic 2011 L44 Sandstone Other D
Slide 24: Contact details
Ground Floor 1322 Hay Street West Perth WA 6005 Telephone: +61 (8) 9321 2665 Fax: +61 (8) 9321 8867 www.carnarvon.com.au
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