Gulf Keystone Petroleum Limited · LSE:GKP
Gulf Keystone Petroleum — FY2015 Earnings Presentation
14 slides from Gulf Keystone Petroleum's earnings presentation, Mar 17, 2016
Slide 1: Investor Presentation
Investor Presentation 17 March 2016
Slide 2: Senior Management
2 Senior Management Jón Ferrier Sami Zouari John Stafford Chief Executive Officer Chief Financial Officer Vice President Operations Joined in June 2015 Joined in January 2015 Joined in 2009 Tony Peart Nadhim Zahawi Umur Eminkahyagil Legal and Commercial Director Chief Strategy Officer Country Manage
Slide 3: CEO Introduction
3 CEO Introduction • Gulf Keystone’s operations remained safe and secure throughout 2015 • Shaikan is a superb field with a motivated workforce dedicated to realising its full potential • Management’s view of Shaikan reserves and resources remains aligned with the 2015 CPR • News on PSC term applica
Slide 4: Looking Forward
4 Looking Forward • Capital discipline and portfolio review in a cash constrained environment • Focus on Shaikan to yield immediate returns with minimal project execution risks • Decision to relinquish Sheikh Adi which carries significant near term cash demands and execution risk • Akri Bijeel relin
Slide 5: Bridge to FDP
5 Bridge to FDP • The updated Field Develop Plan (FDP) was submitted to the MNR in December 2015 • Subject to available financing, plans are in place for an interim project to maintain Shaikan production at 40,000 bopd or increase production to 55,000 bopd • The project can be executed within a year
Slide 6: Profitability and Resilience
6 Profitability and Resilience • ‘Bridge to FDP’ offsets impact of production decline Break-even Dated Brent Prices • Improved resilience to oil prices by reducing the 55,000 bopd break-even price No Investment Bridge to FDP Current End 2016 2016E – 2020E • $36/bbl Brent required to fully recover in
Slide 7: Shaikan Exports
7 Shaikan Exports Tawke Taq Taq • MNR currently control all marketing and crude exports from Kurdistan • From July 2015, oil export deliveries are transported 120km by truck to Fyshkhabour and injected into the Kirkuk-Ceyhan export pipeline for sale at Ceyhan
Slide 8: Shaikan Realised Price
8 Shaikan Realised Price • Realised price for sales to domestic offtaker was $18/bbl in 2015 • Realised price for export sales is estimated at $22/bbl for 2015 • Pricing terms are subject to audit and for January’s production, KRG set the Shaikan quality discount for pipeline exports at $14.7/bbl pl
Slide 9: MNR Agreement 16 March
9 MNR Agreement 16 March Subject to formal Shaikan PSC amendment, GKP and the MNR agreed to: • Change GKP’s capacity building charge from 40% to 30% • Recognise the MNR’s Shaikan Government Participation Option of 20% as a paying party • Implement the provisions of the First Amendment to Shaikan PSC
Slide 10: Shaikan PSC Interests
10 Shaikan PSC Interests As a result of the 16 March Agreement: • GKP’s fully diluted Shaikan working interest and share of reserves will increase from 54.4% to 58% • Capacity building charge will change from 40% to 30% • MNR will pay their 20% of monthly cash costs; 7.5% carried by GKP and MOL Prev
Slide 11: Shaikan Arrears
11 Shaikan Arrears 31 December 30 June Position net to GKP as at: Comments 2015 2015 • Export sales entitlements for the 6 months are in line with cash payments received Revenue arrears $93m $117m • Decrease is due to MNR back-in impacting share of profit oil and clarity on Shaikan realised prices •
Slide 12: 2015 Financial Highlights
12 2015 Financial Highlights • Revenues of US$86.2 million (FY14: $38.6 million) • Revenue recognised when the cash receipt assured, revenue arrears remain unbooked • Capital expenditure of $82 million (2014: $237 million) as GKP reduced its investment programme in view of lower oil prices and irreg
Slide 13: Financial Strategy and Outlook
13 Financial Strategy and Outlook • Significant coupon payments in April and October 2016 of $26.4 million each • Debt repayments of $575 million in 2017 • GKP faces material uncertainty regarding meeting its debt obligations • Options to strengthen the balance sheet are reviewed, including: • Balan
Slide 14: Thank you
Thank you More resources are available at: www.gulfkeystone.com
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