Beach Energy Limited · ASX:BPT
Beach Energy — Non-Deal Roadshow (October 2019)
33 slides from Beach Energy's roadshow presentation, October 2019
Slide 1: US and Canada Roadshow Presentation
OCTOBER / NOVEMBER 2019 US AND CANADA ROADSHOW PRESENTATION
Slide 2: Compliance statements
Compliance statements Disclaimer Financial Data Certain statements in this presentation may include, in addition to historical information, "forward-looking statements" Underlying EBITDAX (earnings before interest, tax, depreciation, amortisation, evaluation, exploration expenses and impairment with
Slide 3: Beach Energy portfolio
Beach Energy portfolio FY19 production Taranaki Basin Western Bass Flank Basin 29.4 MMboe Otway Cooper Basin Basin Perth Basin FY19 2P reserves Taranaki Basin Western Bass Flank Basin Otway 326 Basin MMboe Cooper Basin Perth Basin 3
Slide 4: Asset summary
Asset summary Beach FY19 production1 FY19 2P reserves2 FY20 capex3 Asset Operator? Key FY20 proposed activities Interest (MMboe) (MMboe) range ($million) Western Flank Oil 40 – 100% Op/Non-op 5.2 42 200 – 225 Drill up to 77 wells Western Flank Gas 100% Op 1.9 16 40 – 60 Drill up to 7 wells Cooper Ba
Slide 5: Executive Summary
Executive Summary ✓ Listed on the Australian securities exchange (code: BPT.AX) Company overview ✓ Market capitalization ~A$5.3 billion (~US$3.7 billion)1 ✓ Diversified portfolio of producing assets in 5 basins in Australia and New Zealand Footprint ✓ Oil and gas infrastructure ownership, operating
Slide 6: Delivering on our promises
Delivering on our promises Beach said…. In FY19 Beach delivered… FY19 production1 26 – 28 MMboe ✓ 29.4 MMboe FY19 capital expenditure1 $460 – 540 million ✓ $447 million FY19 free cash flow2 ~$290 million ✓ $559 million FY19 underlying EBITDA2 $1.1 – 1.2 billion ✓ $1.375 billion Return on capital emp
Slide 7: Investing to accelerate production and free cash flow growth
Investing to accelerate production and free cash flow growth Beach is now targeting …and cumulative free cash flow3 …by accelerating investment in 34–40MMboe annual production of more than $2.7 billion over our expanded growth portfolio in the medium term… the next 5 years… Production outlook1 Free
Slide 8: HSE Performance
HSE Performance Lattice acquisition safely integrated Safety performance Environmental performance2 TRIFR1 16 Crude Spill Volumes (kl) 15.6 12 51.9 7.9 99.9% 8 9.6 4 3.5 3.4 3.8 0.2 0.1 0.07 0 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 Focus on HSE delivering best performance to date Process
Slide 9: FY20 guidance
FY20 guidance FY19 Reported1 FY19 Pro Forma1 FY20 Guidance Production 29.4 MMboe 26.2 MMboe 27 – 29 MMboe Capital Expenditure2 $447 million $435 million $750 – 850 million Underlying EBITDA $1.375 billion $1.22 billion $1.25 – 1.40 billion DD&A3 $523 million ($17.8/boe) $443 million ($16.9/boe) $17-
Slide 10: FY20 capital expenditure guidance splits
FY20 capital expenditure guidance splits Investment focus remains on Cooper Basin and Victoria Increase in FY20 vs FY19 driven by Capital expenditure by type …by asset group 5% • Participation in up to 194 wells (FY18: 134 wells) 4% 14% 4% 29% o Western Flank (~84 wells doubling FY19) 26% o Cooper B
Slide 11: East coast gas market
East coast gas market Market dynamics support Beach’s investment strategy Southeastern Australia gas demand vs production1 Conventional supply 600 CSG supply 500 400 Supply gap expected to be met by LNG diversions and/or LNG LNG exports from 300 imports in the absence of material PJ QCLNG, APLNG and
Slide 12: Attractive medium-long term pricing outlook
Attractive medium-long term pricing outlook Higher gas sales and repricing of legacy volumes to deliver higher gas revenues East coast Re-contracted / re-priced volumes gas supply • Lattice gas contracts have annual 100% step-ups and CPI adjustments 90% ahead of repricing events 80% Almost 80% of 70
Slide 13: Delivering as a low cost operator
Delivering as a low cost operator Beach operating costs/boe1 $/boe • Operational Excellence program launched to generate 10 9.9 value through safe, reliable and efficient operations 9.7 o Reliability focus saw average facility reliability 9.4 improve to >97% across our six operated facilities in 9.3
Slide 14: Asset updates
U S A N D C A N A D A R O A D S H O W P R E S E N TAT I O N Asset updates
Slide 15: Cooper Basin Overview
Cooper Basin Overview Key assets include Western Flank (operated and non-operated) and CBJV (non-operated) • Cooper Basin has been explored over the past 60 years • Few operators active in the Basin over this period • Western Flank play was discovered following large acreage relinquishment in 1999.
Slide 16: Western Flank Oil
Western Flank Oil Record year of investment and drilling activity planned in FY20 FY19 production FY20 proposed activities Western • ~$200 million to be invested in Western Flank Flank Oil oil, a record for Beach 5.2 MMboe 29.4 • Up to 77 oil wells to be drilled in FY20, including: MMboe • 36 explor
Slide 17: Western Flank Oil: Bauer
Western Flank Oil Bauer (Beach 100% interest) – keeps on getting bigger Top reservoir map Top reservoir map (pre-2018 appraisal campaign) (pre-2019 appraisal campaign) Success of the Bauer appraisal strategy • Flat structural relief means seismic is of limited value in defining field extent • In FY1
Slide 18: Western Flank Gas
Western Flank Gas ex PEL 106, ex PEL 107 and ex PEL 91, Beach 100% and operator FY19 production FY20 Focus: Western • Potential further appraisal drilling at Lowry Flank Gas 1.9 MMboe and Middleton 29.4 MMboe • Drill 3-5 prospects delineated by Spondylus 3D seismic survey to extend proven Rest of st
Slide 19: Cooper Basin JV
Cooper Basin JV Beach various interests (20.76 - 52.2% range), Santos operator FY19 production FY20 Focus: Cooper Basin JV • ~100 wells currently planned for FY20 8.1 MMboe 29.4 • Follow up development proposed at Moomba MMboe South coming out of the successful FY19 appraisal Rest of campaign Beach
Slide 20: Victorian Otway Basin
Victorian Otway Basin Beach 60% and operator FY19 production FY20 Focus: Vic Otway • Black Watch and Enterprise Extended Basin Reach Directional (ERD) wells to be drilled 8.4 MMboe from mid-FY20 29.4 MMboe • Black Watch connection will add Rest of deliverability from H2 FY20 Beach • Ocean Onyx semi
Slide 21: Increasing exposure to market pricing
Increasing exposure to market pricing Legacy contract pricing to end in FY21/22, exploration and La Bella adds flexibility • Eleven drilling opportunities (eight development) Otway Gas Plant gas production outlook (100% interest)1 planned in the next 3 years to keep the Otway Gas 70 Plant (OGP) full
Slide 22: Bass Basin
Bass Basin Beach 53.75% producing assets, 50.25% non-producing, Beach operated FY19 production FY20 Focus: Bass Basin • Continue development studies on Trefoil gas 1.7 MMboe field 29.4 • Planning for 3D seismic over White Ibis/Bass MMboe • Maintain high facility reliability Rest of Beach • Beach to
Slide 23: New Zealand – Kupe Gas Project
New Zealand – Kupe Gas Project Beach 50% and operator FY19 production FY20 Focus: New Zealand • Kupe Joint Venture approved compression 3.2 MMboe project in Q1 FY20, expected to be completed by late FY21. Supports 29.4 MMboe production plateau extension to FY24 Rest of • 30 day statutory shutdown pl
Slide 24: Perth Basin
Perth Basin Waitsia (Beach 50%), Beharra Springs (Beach 50%1 and operator) FY19 production FY20 Focus: Perth Basin • Commence construction of Waitsia Stage 1 0.7 MMboe expansion 29.4 • FID on Waitsia Gas Project Stage 2 targeting MMboe 100 – 250 TJ/day output Rest of • Trieste 3D seismic survey Beac
Slide 25: Beharra Springs Deep gas discovery
Beharra Springs Deep gas discovery Kingia Sandstone well Log comparison: Waitsia-4 to Beharra Springs Deep-1 • A new gas discovery in Perth Basin at exploration well Beharra Springs Deep-1 (Beach 50% and operator1) • Preliminary net gas pay estimate of 36 metres in the Kingia Sandstone • Kingia Sand
Slide 26: South Australian Otway Basin
South Australian Otway Basin Beach interests 70 – 100% and operator FY20 Focus: • Dombey-1 exploration well spudded in Q1, with gas discovery announced in the Pretty Hill Formation subsequent to quarter end • Completion of construction of 10 TJ/day Katnook gas facility • Follow up appraisal drilling
Slide 27: Frontier Exploration
Frontier Exploration High Impact Exploration Targets in Portfolio Ironbark – Carnarvon Basin (Beach 21% interest) Wherry – Canterbury Basin (Beach 37.5% interest) • Large liquids-rich gas prospect with follow-up potential • Drilling planned FY21, subject to rig availability • Beach share of drilling
Slide 28: Beach illustrative rig schedule
Beach illustrative rig schedule1 Beach to employ 10 rigs in FY20, up from 5 in at the start FY19 H1 FY20 H2 FY20 H1 FY21 Non-operated rig (Santos operator) Non-operated rig (Santos operator) Cooper Basin JV Non-operated rig (Santos operator) Non-operated rig (Santos operator) Operated rig (oil devel
Slide 29: Appendices
Appendices
Slide 30: Indicative FY20 drilling program
Indicative FY20 drilling program Record drilling activity in the Western Flank, offshore Otway drilling to commence FY20 expected number of wells Highlights Gas Oil Total • Record drilling activity for Beach in FY20 - up to 194 wells (FY19: 134) Western Flank 7 77 84 • Record Western Flank drilling,
Slide 31: Reserves and contingent resources
Reserves and contingent resources 204% organic 2P reserves replacement, well ahead of 100% five year average target Summary of reserves at 30 June 2019 Highlights (developed plus undeveloped, net to Beach) ✓ 2P reserves increased by 4% from 313 MMboe to 326 MMboe (MMboe ) FY18 FY19 ✓ 204% organic 2P
Slide 32: Financial highlights
Financial highlights $ million (unless otherwise indicated) FY18 FY19 Change Underlying NPAT recognises Production (MMboe) 19.0 29.4 55% • 55% increase in sales volumes Sales volumes (MMboe) 20.1 31.2 55% • 9% increase in realised oil price Avg. realised oil price1 ($/bbl) 93.4 101.8 9% • 54% increa
Slide 33: Beach Energy Limited Investor Relations
Beach Energy Limited Level 8, 80 Flinders Street Adelaide SA 5000 Australia T: +61 8 8338 2833 F: +61 8 8338 2336 beachenergy.com.au Investor Relations Nik Burns, Investor Relations Manager Mark Hollis, Investor Relations Advisor T: +61 8 8338 2833