Slide 1: Investor Update: Delivering value
INVESTOR UPDATE Delivering value ASX: OEL
Slide 2: Disclaimer and important notices
Disclaimer and important notices Forward Looking Statements This presentation contains "forward-looking statements" that are subject to risk factors that are associated with oil and gas businesses. It is believed that the targets reflected in these statements are reasonable but they may be affected
Slide 3: Our focus
Our Experienced and proven management Gulf of Mexico onshore/offshore conventional oil and gas player focus Disciplined strategic and fiscal strategy: – An excellent base business (3 quality fields) – Invest to optimize existing fields – progress resources to production investment to accelerat
Slide 4: About Otto
About Otto Gulf of Mexico Basin Operating Partner Hilcorp Energy A proven, large-scale hydrocarbon basin Byron Energy Talos Energy Most prolific hydrocarbon basin in US, with rich liquid content Cumulative basin production of 22,463 MMBbl and 191,774 Bcf Average shelf discovery is 6.3 MMBbl an
Slide 5: Corporate snapshot (ASX: OEL)
Corporate snapshot (ASX: OEL) CAPITAL STRUCTURE FUNDING POSITION SHARE REGISTER COMPOSITION Shares on issue 4,795 M Cash (31 Mar 2021) US$7.8 M Corporate/strategic 49% Share price (27 Apr 2021) A$ 0.011 Debt - drawn (31 Mar 2021) US$13.8 M Retail 47% Options and share rights 66 M - undrawn (31 Mar 2
Slide 6: Management team
Management team Mike Utsler, Executive Chairman and CEO Sergio Castro, Chief Financial Officer Will Armstrong, Vice President, New Ventures Philip Trajanovich, Senior Commercial Manager Appointed Chief Executive Officer and Appointed Chief Financial Officer in December Appointed Vice President
Slide 7: Additional members of the management team
Additional members of the management team Kevin Small, Chief Geophysicist Mike Smith, Chief Geologist Ed Buckle, Reservoir Engineer Appointed Chief Geophysicist during October 2019. Appointed Chief Geologist during September 2018. Joined Otto September 2018. Prior to joining Otto Kevin worke
Slide 8: Otto's mission, vision and values
Otto’s mission, vision and values Maximising a robust base business while creating future value MISSION Total shareholder return (TSR) versus Australian Deliver superior shareholder value and US peers VISION Delivery on KPIs: + Reserve/Output Growth + Scale Achieve outstanding business delivery as a
Slide 9: Otto's Environmental, Social and Governance (ESG)
Otto’s Environmental Environmental, Multi-year BDO audited reportable releases financials tracked Weekly Monthly and Board committees Social and Annually including Audit & Risk and Active Remuneration and Corporate whistleblower Nomination TRIR and DAFWC tracked policy Weekly Monthly and Annually An
Slide 10: An excellent base business
01 An excellent base business 10
Slide 11: An excellent base business
An excellent base business SOUTH MARSH ISLAND BLOCK 71 MATAGORDA COUNTY “LIGHTNING” GREEN CANYON 21 “BULLEIT” Top 10 largest shelf discovery in Largest onshore Texas discovery Deepwater pliocene reservoirs on last ten years on GoM shelf in the last 10 years salt supported structure Geologically co
Slide 12: South Marsh Island Block 71
South Marsh Island Block 71 Flagship GoM Shelf asset that has created strong base for current and future growth Salt dome structure located in liquid-rich corridor of Gulf of Mexico shelf Located in 131 feet of water F-1 discovery well drilled in 2016 Cumulative production has been 3.2 MMBbl &
Slide 13: Matagorda County "Lightning"
Matagorda County “Lightning” Onshore gas asset offering both product and geographic diversification Deep seated structure trapping “Tex Miss” channel-levee complex sands Located south-central Matagorda County, Texas Green No. 1 discovery well drilled in 2019 Cumulative production has been 11.5
Slide 14: Green Canyon 21 "Bulleit"
Green Canyon 21 “Bulleit” Deepwater GoM development that leveraged infrastructure for early 1st production DTR-10 Deepwater pliocene reservoirs on salt supported structure MP SAND SAND Located in 771 feet of water GC 21 discovery announced in June 2019, first production in October 2020 Four pr
Slide 15: Asset performance to date
Asset performance to date A track record of strong returns from development SM 71 LIGHTNING GC-21 DOFP CY2018 CY2019 CY2020 COMMODITY WEIGHT 86% Oil 85% Gas/Cond. 90% Oil NET CAPEX REQUIRED US$27.6M US$19.4M US$44.9M NET IP (BOEPD/MMCFD) 1800 BOEPD 8 MMCFED 600 BOEPD NET 2P RESERVES 3.3 MMBOE 26.1 B
Slide 16: Maximising the existing base
02 Maximising the existing base 16
Slide 17: Optimising captured resources
Optimising captured resources Creating value through leveraging organic options 1P Reserves: 4,051 MBoe 2P Reserves: 6,359 MBoe 3P Reserves: 8,874 MBoe Six wells (five are PDP Adds one additional well Adds one additional well and one, Green #3, is a (Green #4) plus 2,308 Boe (Green #5) plus 2,
Slide 18: SM 71 upside: D Sand
SM 71 upside: D Sand Potential to add 2.8 MMBbl (2P) through production without any additional capital Current production from F-Platform F-1: 800 bopd F-2: 20 bopd F-3: 1800 bopd A F-4 well (Non-Otto participation) A’ F-5 – Temporarily abandoned Volumetrics Proved: 3.1 MMBbl Structural
Slide 19: Lightning upside: development of Tex Miss 2/3
Lightning upside: development of Tex Miss 2/3 Potential to add +/- 66 Bcf via drilling and development GREEN No. 1 Structure Map of Tex Miss 2/3 Current production From Green #1 & #2 TEX MISS 20 MMcfpd + 600 Bcpd 1 SAND Production logs indicate only 1 MMcfpd from Tex Miss 2/3 Volumetrics Tex M
Slide 20: GC 21 "Bulleit" upside
GC 21 “Bulleit” upside Potential to increase production via recompletion DTR-10 MP Future work SAND SAND Rig recompletion to recomplete to DRT-10 Sand. Anticipated in mid CY 2022 Structural contour map of DTR-10 Structural contour map of MP Sand Sand 20 Gamma Ray/Resistivity log of DTR-10 Sand G
Slide 21: Base plus infill upside potential outcomes
Base plus infill upside potential outcomes Production and capital expenditure profiles Otto production outlook: Base plus organic options Otto capital expenditure outlook: Base plus organic options (Mboe) (US$’000) 30,000 1,600 1,400 25,000 1,200 20,000 1,000 800 15,000 600 10,000 400 5,000 200 - -
Slide 22: Creating future value
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Slide 23: Future value creation
Future value Prospect portfolio generation/access creation Asset evaluation Acquisition of underdeveloped and under-valued Driven by a highly disciplined approach to Divestment of existing/swap capital management Company evaluation Sale of Otto Merge with aligned company Acquire Dividend r
Slide 24: Otto's shareholding in Pantheon Resources Plc
Otto’s shareholding in Pantheon Resources Plc Material value holding in Alaska pure play E&P Otto holds 14,272,592 shares in Pantheon Resources Plc (LSE: PANR) currently valued at approx. A$ 8.9 MM / US$ 6.9 MM as at 3 Pantheon acreage map May 2021. 1,2 In addition to our Pantheon shareholding O
Slide 25: Otto opportunity screening history (2018-21)
Otto opportunity screening history (2018-21) A conservative evaluation track record 280 individual prospects reviewed 2700-Block area of GoM shelf with highest liquid content Seismic amplitude-supported, Stacked-Tertiary- 280 individual prospects age reservoirs reviewed Low-cost operating envi
Slide 26: Otto performance objectives
Otto performance objectives Maximise our base business while creating future value INORGANIC GROWTH BASE AND ORGANIC GROWTH OPTIONS OPPORTUNITIES PERFORMANCE OBJECTIVES Facilitated by underlying base business Base business + organic options (3-year group targets) Key targeting criteria Base business
Slide 27: GoM shelf/onshore: salt dome driven basin
GoM shelf/onshore: salt dome driven basin Geological characteristics drive substantial opportunity set Geological attributes OTTO’S SM 71 DISCOVERY Geologically complex salt dome structures Miocene and Pliocene-aged reservoirs with varied sand depositional histories Extensive sand/shale cycles
Slide 28: Otto's disciplined opportunities assessment process
Otto’s disciplined opportunities assessment process A detailed, technically driven filter Central GOM Shelf selected as opportunity area 2,700-Block area of GOM shelf with highest liquid content Central GOM shelf Stacked Miocene/Pliocene-aged reservoir package – seismic amplitude-supported and m
Slide 29: Cost base and balance sheet strength
04 Cost base and balance sheet strength 29
Slide 30: Strong outcomes in a challenged macro environment
Strong outcomes in a challenged macro environment Delivering financial performance against a volatile energy market Operating Performance 223% (FY19) and 4% (FY20) increase in crude oil production 790% (FY19) and 102% (FY20) increase in natural gas production 26% decrease in FY20 average prices led
Slide 31: Commodity Price Risk Management (CPRM)
Commodity Price Risk Management (CPRM) Proactive oil price hedging policy Balanced hedge strategy provides meaningful downside protection while allowing some upside participation with higher oil prices. Average 2021 (Apr - Dec) hedge price of US$51.08/bbl on 714 BOPD using LLS Swaps. Average 2
Slide 32: Substantial cost reductions delivered
Substantial cost reductions delivered On track to reduce FY21 office operating costs by 40% - with further cost efficiencies targeted Indirect operating expenses Historical fully costed Targeted 3-year fwd. Actual costs Targeting further reductions in payroll and service provider costs US$31.00/Bb
Slide 33: Debt-driven leverage profile
Debt-driven leverage profile High confidence in abilities to service/reduce Production Available debt facilities (at 31 March 2021) 1,101 Mboe 946 US$25 M – Tranche A1 742 US$10 M – Tranche A21 US$20 M – Facility B (terms to be determined) 194 Debt balance (at 31 March 2021) Tranche A1 fully d
Slide 34: Otto Energy: delivering value
Otto Energy: delivering value 1 The GoM 4 External assessment A mature, opportunity-rich environment Creating growth access through rigorous inorganic opportunities evaluation 2 Our base A diverse, liquids-rich, high-margin 5 Shareholder returns portfolio Against a highly disciplined approach to cap
Slide 35: The relative value opportunity (AUS)
The relative value opportunity (AUS) Substantial potential upside implied Current EV Indicative EV Range - AUS Peers 1P Reserves (mmboe) 2P Reserves (mmboe) Q2 FY21 Daily Production (boe/d) FY20 Revenue (AUD) FY20 EBITDA (AUD) 0 50 100 150 200 250 300 350 400 Indicative Enterprise Value (A$m) Source
Slide 36: The relative value opportunity (US)
The relative value opportunity (US) Substantial potential upside implied Current EV Indicative EV Range - US Peers 1P Reserves (mmboe) Q2 FY21 Daily Production (boe/d) FY20 Revenue (AUD) FY20 EBITDA (AUD) 0 50 100 150 200 250 300 350 400 Indicative Enterprise Value (A$m) Source: See “Peer Group (US)
Slide 37: Appendix
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Slide 38: Regulatory Agencies GoM and Texas
Regulatory Agencies GoM and Texas Status and updates GoM Agency Regulatory status Otto impact Regulatory Texas Party Otto status status Paused new lease Existing Federal Leases are Individual Leasing BOEM sales in Federal Existing State Leases are Held By Production Leasing Mineral No Change Jurisdi
Slide 39: Peer Group (AUS)
Peer Group (AUS) Peer Company Source Data • 1P and 2P Reserves as per “Annual Report to shareholders”, released 24 September 2020 Central Petroleum Limited • Q2 FY21 daily production as per “Quarterly Activities Report & Appendix 5B”, released 29 January 2021 • 1P and 2P Reserves as per “Annual Repo
Slide 40: Peer Group (US)
Peer Group (US) Peer Company Source Data Talos Energy Inc. • Q4 2020 Production and Proved Reserves as per Form 10-K SEC filing released 11 March 2021 Contango Oil & Gas Company • Q4 2020 Production and Proved Reserves as per “Contango Investor Presentation” released 10 March 2021 Range Resources Co