Oil India Limited · NSE:OIL
Oil India — Investor Presentation (July 2010)
49 slides from Oil India's investor presentation, July 2010
Slide 1: Investor Presentation
Investor Presentation A Navratna Company July, 2010
Slide 2: Disclaimer
Disclaimer This presentation contains certain forward looking statements concerning OIL India’s future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements.
Slide 3: Sector Fundamentals
atae sisar tates Oil India Limited Sector Fundamentals
Slide 4: Global Oil and Gas Trends
Global Oil and Gas Trends Brent oil price futures/forwards and forecasts LTM oil price and equity market performance (USD/bbl) (Rebased to Brent) 160 85 140 75 120 +115% 100 65 +76% 80 55 60 45 +32% 40 35 20 0 25 2003 2005 2007 2009 2011 2013 Mar-09 Jun-09 Aug-09 Nov-09 Mar-10 Broker high/ low range
Slide 5: Domestic Industry Environment
Domestic Industry Environment Steady growth in domestic energy consumption Energy sources (%) driven by India’s economic growth story1 Crude oil and natural gas sources would tend to grow (mmtoe) 469 in significance as the Indian economy develops 433 379 Energy Sources - India 344 295 261 Natural Nu
Slide 6: India: Energy Scenario
India: Energy Scenario Primary Energy Consumption (MTOE) Crude Oil Consumption (MTOE) Iran 205 Canada 97 S Korea 238 Brazil 104 France 242 S Korea 104 Germany 290 Germany 114 Canada 319 UAE 122 Japan 464 Russia 125 India 469 4.2% of total India 149 3.4% of total Russia 635 Japan 198 China 2,177 Chin
Slide 7: OIL India – An Overview
atae sisar tates Oil India Limited OIL India — An Overview
Slide 8: Oil India: Brief Overview
Oil India: Brief Overview Rich Heritage Independent India’s first commercial oil discoveries, with the first made in 1953 Integrated O&G Player Presence across Oil & Gas Value Chain (E&P, Transportation and Downstream) Infrastructure to support growth Large Acreage Domestic acreage: 127,879 square k
Slide 9: Our Vision
Our Vision "The fastest growing energy company with a global presence providing value to the shareholder" Fastest growing Energy Company with highest profitability. Delight customers with quality products and services at competitive prices Learning Organization, nurturing initiatives, innovations an
Slide 10: Rich heritage of building a company
Rich heritage of building a company • Independent India’s first commercial oil discoveries were made by Assam Oil Company – Nahorkatiya, Assam – 1953 – Moran, Assam – 1956 • Incorporated as Joint Sector Company on 18 February, 1959 – 2/3rd Owned by Assam Oil Company / Burmah Oil Company – 1/3rd Owne
Slide 11: Integrated Oil & Gas Player
Integrated Oil & Gas Player Exploration Production Transportation Downstream Domestic: 30 E&P 50 years of Crude Oil: Refining and blocks1 experience – 1,157 km pipeline ; marketing petroleum FY 10 Produced ~6 MMT capacity products: International: Egypt, 25.70 mm bbl of – 26% equity stake Gabon, Iran
Slide 12: Strong Domestic Acreage Base
Strong Domestic Acreage Base Blocks Op N/Op Total NELP 12 18 30 AA-ONN 30% Pre-NELPJV - 3 3 PEL (Nom) 19 - 19 AA-ONN 90% PML 13 - 13 AA-ONN 50% ASSAM +AP Total 44 21 65 AA-ONN 85% AA-ONN 50% 60% RJ-ONN AAP-ON 16% AA-ONN 20% 60% RJ-ONN AA-ONN 15% AA-ONN 85% 75% RJ-ONN AA-ONN 10% MN-OSN 20% MZ-ONN 75%
Slide 13: With Dominant International Footprint
With Dominant International Footprint LIBYA EGYPT 50 7,087 Area 86 Block 3 8,287 25 50 2,710 Area 102/4 Block 4 2,600 (GSPC) 25(Sonatrach) 6,629 Area 95/96 NIGERIA SUDAN 741 km 10 17.5 (Suntera) 2,094 OPL 205 Pipeline GABON IRAN 45 3,761 Shakti Farsi Offshore 3,500 20(OVL) TIMOR LESTE 12.5 3.5 Block
Slide 14: Exploration and Development Growth Mapping (Acreage)
Exploration and Development Growth Mapping (Acreage) Acreage (Sq. Km) ~ 10 Times Growth 180000 Current Acreage 160000 Domestic = 127,879 sq.km 140000 Overseas = 41,656 sq.km 120000 NELP 100000 (1999 onwards) 80000 60000 + Overseas 40000 Nomination Including Pre- (2005 onwards) 20000 NELP JVs (Till 1
Slide 15: Strong Reserve Base with Significant Growth Potential
Strong Reserve Base with Significant Growth Potential In MMBBL As on 01/04/2010 1600 1,437 1400 1200 522 957 1000 800 377 600 521 915 400 239 580 200 282 0 1P 2P 3P Crude Oil Natural Gas 1P Reserves represent: ≥ 11 Years current production of Crude Oil ≥ 15 Years current production of Natural Gas ≥
Slide 16: Healthy and Consistent Reserve Replacement Ratio
Healthy and Consistent Reserve Replacement Ratio Reserve Replacement Ratio (x) 1.59 2.04 2.04 1.69 1.65 Crude Oil and Natural Gas (O+OEG) Production and Reserve Accretion (in MMTOE) 10.4 10.3 9.4 9.7 8.4 5.6 5.9 5.3 5.1 5.1 FY2006 FY2007 FY2008 FY2009 FY2010 Production (O + OEG) Accretion Adequate r
Slide 17: Integrated In-house E&P Infrastructure To Support Growth
Integrated In-house E&P Infrastructure To Support Growth Infrastructure to Support E&P Activities Production & Storage Facilities Two 2D and 72 Six Logging One 3D Production Seismic Crew Trucks Installations 5,000 Km ~150k KL 14 W/over 11 Drilling O&G Crude Rigs Rigs Pipelines Storage In house Exper
Slide 18: Strategy to Deliver Long Term Growth and Shareholder Value
Strategy to Deliver Long Term Growth and Shareholder Value 1 Use Advanced Techniques to Improve Existing Productivity Continue to induct world class technology 5 Explore Non-conventional 2 Increase Reserves and energy sources Production in Existing Acreage Explore alternate energy Further Integrate
Slide 19: Significant Investment Lined Up in Next 2 Years
Significant Investment Lined Up in Next 2 Years USD 1.9 bn of investment plans in the next two fiscal years Significant focus on Exploration and Development of existing acreage potential and M&A 2010-2011: Rs 47,964 mn 2011-2012: Rs 36,579 mn Overseas M&A Projects 1% 11% Exploration & Appraisal Dome
Slide 20: Planned Activities in FY11
Planned Activities in FY11 3D Seismic Surveys Exploratory Drilling Development Drilling 34 1,798 46 30 984 17 FY10 FY11 FY10 FY11 FY10 FY11 3D Planned in FY11 Assam & AP Major thrust continues – 250 SqKm in Assam – 17 wells planned in to be in Assam & AP & AP (FY10: 744) FY11 (FY10: 13) – 44 wells f
Slide 21: OIL: Strategy in Place To Deliver Long Term Value
OIL: Strategy in Place To Deliver Long Term Value Organic Growth- supported by our E&P Programme – To enhance the production of crude oil on a sustainable basis from the existing assets in NE region – To increase the gas sales significantly in NE region – To discover hydrocarbons in our NELP & overs
Slide 22: Shareholding pattern
Shareholding pattern 3.5% 0.7% 1.6% 3.4% 12.4% 78.4% Promoters (GOI) Bodies Corporate Public & Others FII MF FI / Banks Key shareholders % Shareholding • Listing :Listed on BSE/NSE on 30th Sept 2009 Indian Oil Corporation 4.45% • Number of shares : 240.45 mn Bharat Petroleum Corporation 2.23% • Divi
Slide 23: Performance of OIL's Shares (W.r.t. Sector)
23 OILSHAREPRICE` 1,150.00 1,200.00 1,250.00 1,300.00 1,350.00 1,400.00 1,450.00 1,500.00 22-Jun-10 23-Jun-10 24-Jun-10 25-Jun-10 28-Jun-10 29-Jun-10 30-Jun-10 1-Jul-10 2-Jul-10 5-Jul-10 6-Jul-10 OIL 7-Jul-10 8-Jul-10 9-Jul-10 ONGC 12-Jul-10 Performance of OIL’s Shares (W.r.t. Sector) 13-Jul-10 14-J
Slide 24: Performance of OIL's Shares (w.r.t. SENSEX / NIFTY)
Performance of OIL’s Shares (w.r.t. SENSEX / NIFTY) OIL SHARE PERFORMANCE VS. SENSEX (FROM 22.06.2010 T O 23.07.2010) OIL SHARE PRICE ` 1,500.00 20,000.00 1,440.00 19,500.00 19,000.00 1,380.00 18,500.00 1,320.00 18,000.00 1,260.00 17,500.00 17,000.00 1,200.00 16,500.00 1,140.00 16,000.00 12-Jul-10 1
Slide 25: OIL has Outperformed the Benchmark Indices Since Listing
OIL has Outperformed the Benchmark Indices Since Listing 140% 130% 28.3% 120% 14.4% 110% 3.8% 100% 3.4% 90% 80% Sep 09 Nov 09 Jan 10 Feb 10 Apr 10 Jun 10 Oil India ONGC BSE Oil & Gas Index SENSEX Source: Bloomberg as on June 30, 2010 25
Slide 26: Recent Developments
atae sisar tates Oil India Limited Recent Developments
Slide 27: Select Highlights for FY2010
Select Highlights for FY2010 OIL’s shares listed in Mumbai Stock Exchange on 30.09.2009. Achieved the highest daily rate of crude oil production of 3.61 MTPA (> 26 mmbbls/Year) Achieved the highest daily rate of natural gas production of 6.67 MMSCMD in North East and potential of 0.93 MMSCMD in Raja
Slide 28: Select Highlights for FY2010 (Contd.)
Select Highlights for FY2010 (Contd.) Completed 660 Km long NRL – Siliguri Product Pipeline. LPG plant completed 26 years of continuous service with excellent track record of 99% Plant Load Capacity. LPG production of 44,950 tonnes in 2009-10 was 103.1% of target Made six hydrocarbon discoveries in
Slide 29: Key Developments
Key Developments Numaligarh Refinery Shutdown • Numaligarh Refinery Shutdown since 16th March, 2010 to End June, 2010 – Resulting in a loss of approx. 0.13 MMT of Crude oil & 28 mmscm of NG – Actions are in hand to make up for the Loss Revision of Natural Gas Prices • Price for Natural Gas increased
Slide 30: Partial De-Control
Partial De-Control Parikh Committee Recommendation EGoM Decision Petrol To be Deregulated Petrol Prices De-regulated Diesel To be Deregulated Diesel Prices Partially De-regulated Increase of Rs. 6 per Litre for Kerosene Increase of Rs. 3 per Litre for Kerosene Increase of Rs. 100 per Cylinder for LP
Slide 31: Operating Performance
stat dtear farses Oil India Limited Operating Performance
Slide 32: Crude Oil and Natural Gas Production
Crude Oil and Natural Gas Production Crude Oil Production (mm bbl) Natural Gas Production (mm scm) 0.93 • NRL shutdown impact in Q1 FY11 – 0.93 mm bbl 32
Slide 33: Crude Oil Production Cost (Assam & AP)
Crude Oil Production Cost (Assam & AP) 7.09 7.10 7.24 7.24 6.806.80 4.80 4.80
Slide 34: Low Finding & Development Costs
Low Finding & Development Costs Finding and Development Costs (USD / bbl) OIL has the Advantage of Low Finding & Development costs. 34
Slide 35: Financial Performance
stat dtear farses Oil India Limited Financial Performance
Slide 36: Sharing of Subsidy by Upstream Companies
Sharing of Subsidy by Upstream Companies Rs. In Crores 2006-07 2007-08 2008-09 2009-10 Q1-FY10 Q1-FY11 ONGC 17,025 22,001 28,226 11,554 429 5,516 OIL 1,994 2,307 3,023 1,549 58 730 GAIL 1,488 1,401 1,694 1,326 75 445 Total 20,507 25,709 32,943 14,430 561 6691 % SHARING 2006-07 2007-08 2008-09 2009-1
Slide 37: Realized Price
Realized Price (USD/barrel) 83.22 81.69 78.1 68.53 58.13 56.21 57.49 55.57 55.65 49.68 39.01 39.80 39.39 36.15 33.79 FY2008 FY2009 FY2010 Q1 FY10 Q1 FY'11 Gross Realized Price Realized Price after Subsidy/Discount Net Realized Price 37
Slide 38: Strong Revenue and Profitability
Strong Revenue and Profitability Revenue and Profitability analysis (INR Cr.) 38
Slide 39: Strong Net-worth and Book Capital
Strong Net-worth and Book Capital Networth (INR Cr.) and Book Value Analysis (INR) 39
Slide 40: Cash Flow and EBITDA Margin
Cash Flow and EBITDA Margin Cash Flow (INR Cr.) EBITDA (INR Cr.) and EBITDA MARGIN (%) EBITDA EBITDA MARGIN Consistent and Attractive Cash Flow Generation 40
Slide 41: Dividends distribution and Earnings per share highlights
Dividends distribution and Earnings per share highlights Dividends distribution Earnings per share and Debt-Equity ratio The dividend per share has shown a consistent Steady increase in EPS and minimal debt on the uptrend balance sheet 41
Slide 42: Guidance: FY11
Guidance: FY11 2009-10 2010-11 (Target) Crude oil production 3.57 mmt 3.70 MMT Natural gas production 2,415 mmscm 2,620 mmscm Increase in Exploratory and Development Drilling Meterage Increase in Work Overs Enhanced Water Injection Endeavour to Enhance LPG production through NGL Recycling Endeavour
Slide 43: Conclusion
Conclusion Stable Operations, Looking for Growth Company with Good Operating Track Record Sound Financial Health Company with more than 5 Decades of E&P Expertise Large Prospective E&P Acreage Entry into Deepwater/Offshore Blocks as Operator Entry into discovered assets in Venezuela, Acquisition Thr
Slide 44: Thank You
Thank You ee \
Slide 45: Venezuela - Project Carabobo
Venezuela - Project Carabobo • Contains two Blocks – North and Central • OIL’s PI – 3.5% [PdVSA-60%, REPSOL, PETRONAS, OVL – 11% each, IOC-3.5%] • Contract Period – 25 Years, Possible Extension – 15 Years • Estd Oil In Place – 27.3 billion barrels • Recoverable Reserve (in 25 Years) - 3 billion barr
Slide 46: Crude oil production
Crude oil production Crude Oil (mmbbls) 28 27 27.12 26 25.7 25 24.95 24 22.99 23 22.69 22.17 22.38 22 21 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 Year 46
Slide 47: Crude oil production daily rate
MTPD 47 4000 5000 6000 7000 8000 9000 10000 4/1/2006 5/16/2006 6/30/2006 8/14/2006 9/28/2006 11/12/2006 12/27/2006 2/10/2007 3/27/2007 Crude oil production 5/11/2007 6/25/2007 8/9/2007 9/23/2007 11/7/2007 12/22/2007 2/5/2008 3/21/2008 5/5/2008 Time 6/19/2008 8/3/2008 9/17/2008 11/1/2008 Daily Produc
Slide 48: Crude oil production – NRL effect
MTPD 10000 4000 6000 8000 1/1/2010 1/7/2010 1/13/2010 1/19/2010 1/25/2010 1/31/2010 2/6/2010 2/12/2010 2/18/2010 2/24/2010 3/2/2010 3/8/2010 3/14/2010 3/20/2010 3/26/2010 Daily produciton rate 4/1/2010 4/7/2010 Crude oil production – NRL effect 4/13/2010 Time 4/19/2010 4/25/2010 Oil production cutba
Slide 49: Refinery wise Crude Oil Delivery
Refinery wise Crude Oil Delivery Qty in bbls Particulars Q1 FY'11 Q1 FY'10 Variation % Variation IOC(AOD) 1,095,063 508,486 586,578 115.36 IOC (GHY) 1,710,390 1,403,462 306,928 21.87 IOC (BGR) 1,609,146 777,360 831,785 107.00 NRL 1,084,137 3,472,910 (2,388,772) (68.78) Total 5,498,736 6,162,218 (663