Amplitude Energy Limited · ASX:AEL
Amplitude Energy — Cooper Energy — H1 FY2017 Earnings Presentation
36 slides from Amplitude Energy's earnings presentation, Feb 27, 2017
Slide 1: FY17 First half results & Sole gas project
FY17 First half results & & Sole gas project ss COOPER ; & ENERGY tT las
Slide 2: Disclaimer
The information in this presentation: For personal use only • Is not an offer or recommendation to purchase or subscribe for shares in Cooper Energy Limited or to retain or sell any shares that are currently held. • Does not take into account the individual investment objectives or the financial sit
Slide 3: Cooper Energy's gas strategy has delivered transformation
For personal use only 1 Cooper Energy’s gas strategy has delivered transformation • now have a gas business that generates 75% of production • 2P reserves increased more than 8 times to 11 million boe • moving to Operatorship of the major assets • portfolio 100% Australia1. 2 FY17 production upgrade
Slide 4: Financial results: lower oil price and volumes, impairments as international exit completed
For personal use only Financial results: lower oil price and volumes, impairments as international exit completed • Revenue of $11.0 million, down 25% on lower volumes and oil prices • Statutory net loss after tax $8.2 million vs H1 FY16 net loss of $34.1 million • Underlying net loss after tax of $
Slide 5: Safety and environment
For personal use only • Single recordable case (Medical Treatment Injury – lizard bite in Total Recordable Case Frequency Rate (TRCFR) Indonesia) Events per million hours worked 8 • TRCFR1 = 1.3 (versus FY16 TRCFR = 0.0) • Zero Lost Time Injuries 6 • Zero environmental incidents 4.2 • 358,000 hours
Slide 6: H1 FY17 financial summary
For personal use only $ million unless otherwise indicated H1 FY17 H1 FY16 change Production MMbbl 0.19 0.25 ▼ - 24% Sales volume MMbbl 0.19 0.24 ▼ - 21% Sales revenue 11.0 14.6 ▼ - 25% Oil price average A$/bbl 58.82 60.58 ▼ - 3% Operating cash costs average A$/bbl 29.68 30.79 ▼ - 4% Gross profit 4.
Slide 7: Underlying loss after tax movement
For personal use only $ million movement Sales revenue: Sales revenue: OGP Care & Admin and 0 FY16H1 price volume Cost of Sales Other revenue Exploration w/o FX movements Mntnce other Tax impacts FY17H1 -1.3 Includes, acquisition & integration +0.6 costs, Tunisian -0.8 -0.4 redundancy +0.1 -3.5 -0.4
Slide 8: Oil and gas segment underlying results
For personal use only H1 FY 17 $ million Oil Sales revenue 11.0 Gross profit 4.6 Exploration expense 0.6 General administration1 0.8 Underlying EBITDA 4.1 Underlying profit before tax 3.1 Income tax 0.9 Oil underlying net profit after tax 2.2 Gas1 and Corporate1 underlying loss after tax (5.7) Coope
Slide 9: Cash and investments movement
For personal use only 0.8 Investments 60.1 0.5 (at fair value) $ million Cash & Investments 90.5 deposits (at fair value) 1.0 3.7 7.3 3.0 0.5 43.7 12.8 Cash & 49.8 deposits Operating cash flow Investing & FX (6.1) $46.8 Jun-16 Operations General Net Working Interest Operating E&D Equity issue FX & O
Slide 10: Operatorship and management system upgrades
For personal use only • Otway Basin and Gippsland Basin assets acquired effective 1 January 2017 • Application for operatorship proceeding, target end-June appointment • Implementing management system upgrades for new operatorship requirements including - HSEC - JV accounting - production operations
Slide 11: FY17 production, 2P reserves and contingent resources
For personal use only FY17 production1 2P reserves1 Contingent resources (2C)1 MMboe expected MMboe MMboe 74.4 11.6 1MMboe 66.8 41.6 Gas Gas Gas 10.4 36.7 Oil Oil Oil 0.24 – 0.28 MMbbl 1.3 1.1 7.6 4.9 Jun-16 Jan-17 Jun-16 Jan-17 Jun-16 Jan-17 • Addition of Otway gas • Addition of 60 PJ of Otway • Au
Slide 12: Sole project: March quarter 2017 milestones
For personal use only March Quarter 2017 Sole Development plan finalised Project Project team transition Project ready to proceed and finalise finance Production licence offered by NOPTA Final construction and rig contracts early March Pre-sanction gas contract target achieved Gas contract
Slide 13: Sole development plan finalised
For personal use only • Development plan finalised with 2 horizontal wells – encouraged by lower drilling costs * * • 2 well development plan enhances project – lower technical risk, improved redundancy – 2C Contingent Resources1 upgrade to 249 PJ – supports financing – field production capability i
Slide 14: Heads of Agreement with APA Group
For personal use only Transaction elements: Cooper Energy to sell Orbost Gas Plant to APA Group. 1 Heads of Agreement (non-binding) provides for APA to take ownership, subject to Sole FID. APA to be responsible for funding and performance of ~$250 million plant upgrade and processing of gas from Sol
Slide 15: Sole gas contracted with blue chip customers
For personal use only • Achieved objective of contracting 20 PJ pa1 (55 TJ/day) of Sole output Sole gas production: contracted and uncontracted with blue chip customers PJ pa – based on current onshore plant capacity2 67.9 TJ/day • Secured sales for ~ 12 PJ pa since June 2016 – EnergyAustralia: 5 PJ
Slide 16: Gippsland gas projects: Sole and Manta
For personal use only Orbost Gas Plant • Existing gas plant • Connected to Eastern Gas Pipeline Longtom • Plant owned & operated by APA Group (Seven Group 100%) (proposed in HoA announced 27/2/17 Patricia Baleen (COE 100%) Phase 2: Manta • 2C Resource1: 106 PJ gas, Phase 1: Sole 3 .2 MMbbl liquids •
Slide 17: Sole project benefits
For personal use only Development Plan reduced technical risk • 2 well development • Upstream CAPEX fixed price contracts increased gas reserves excluding drilling opportunity for increased annual production subject to plant capacity increased capacity to supply higher price short Equity Str
Slide 18: Management team strengthened
For personal use only 1 Management team strengthened with appointment of Duncan Clegg, General Manager, Development Brings proven capability in offshore development and oil and gas project leadership; 35 years of industry experience including senior management at Shell & Woodside. Refer bio in Appen
Slide 19: Otway Basin assets
For personal use only Key Assets • Casino Henry gas project (50%) • Minerva gas field and plant (10% interest)1 • VIC/P44 exploration permit Production (COE share, effective from 1 January 2017) • Casino Henry: 7 PJ pa, supplied to EnergyAustralia under contract expiring March 2018 • Minerva ~ 1 PJ
Slide 20: Cooper Basin oil
For personal use only • First half production of 0.13 MMbbl vs 0.17 in H1 FY16 • Production impacted by suspension of drilling in low oil price FY16 • Operating costs reduced from A$29.92/bbl to A$29.28/bbl • Drilling resumed in FY17 with 4 wells drilled; 2 successful, 2 P & A • No further drilling
Slide 21: Reserves uplift and H2 FY17 catalysts
For personal use only Reserves uplift • Sanction of Sole gas project to add ~43 MMboe to Cooper Energy 2P reserves Uplift in 2P reserves* MMboe rounded • Proforma June reserves then approximate 53 MMboe, > 4 times current levels Organisational capability & advantage • Securing regulatory approval as
Slide 22: Production growth profile
For personal use only Production1 • Sustained growth profile over 6 years MMboe 12 • Gas accounts for overwhelming majority of production • New assets and production profile generates: 10 – FY17 production >2x FY16 production Manta – FY19 production >5x FY16 production 8 gas project – FY21 productio
Slide 23: Summary
For personal use only • Execution of our gas strategy has delivered: Cooper Energy has become a supplier and developer of gas for south east Australia at a time of great market need • Reserves and production upgrades are the first instalment of a 6 year growth trajectory offering > 20 times growth i
Slide 24: Appendices
For personal use only Appendices
Slide 25: Cooper Energy company overview and key figures
For personal use only Cooper Energy is an independent Australian exploration and Key figures production company Shares on issue1 660.1 mill • Listed in 2002, history of profitable operations and successful exploration and development Shareholders1 5,788 • Strong balance sheet, zero debt Market capit
Slide 26: Reconciliation of statutory to underlying loss
For personal use only 6 months ending 31 December 2016: $ million Net profit loss after tax (8.2) Adjusted for: Impairment of discontinued operations (Indonesia) 0.7 Provision 4.0 Underlying net profit loss after tax (3.5) 26
Slide 27: Capex and revised capex guidance
For personal use only Capex vs PCP Revised capex guidance1 Prior FY16 H1 FY17 H1 Change Vic gas asset Sole pre-FID2 Revised guidance3 FY17 Cooper 0.8 2.1 1.3 Cooper 5.3 - - 3.9 Otway 0.1 0.3 0.2 Otway 0.7 6.6 - 8.6 Gippsland 8.6 11.0 2.4 Gippsland 13.8 - 18 - 20 31.4 - 33.4 Indonesia 3.9 - (3.9) Ind
Slide 28: Hedge arrangements
For personal use only Hedge arrangements as at 31 December FY17 H2 FY18 H1 Total (bbl remaining): A$57.00 – 69.70 collar options 30,000 - 30,000 A$54.45 50% participating swap 30,000 30,000 60,000 Total 60,000 30,000 90,000 28
Slide 29: Reserves
Proved Proved & Probable Proved, Probable & Possible Reserves* (1P) (2P) (3P) For personal use only Cooper1 Otway2 Total Cooper1 Otway2 Total Cooper1 Otway2 Total Developed Sales Gas PJ 0.0 4.8 4.8 0.0 15.2 15.2 0.0 29.3 29.3 Oil + Condensate MMbbl 0.5 0.0 0.5 0.9 0.0 0.9 1.6 0.0 1.6 Total developed
Slide 30: Production profile by project
For personal use only 156 TJ/day 25 25 120 23 TJ/day Gippsland Gas Project Phase 2 Manta 12 85 TJ/day 68 TJ/day 25 25 25 25 Gippsland Gas Project Phase 1 25 Sole 19 Otway 2P reserves: 19 Casino Henry TJ/day 7 6 6 7 7 7 4 5 2017 2018 2019 2020 2021 2022 2023 2024 Assumes: • Sole sanction by March qua
Slide 31: Gippsland Basin assets
For personal use only Sole Gas Project (VIC RL/3, COE:100%, Operator ) • 249 PJ 2C Contingent Resource1 • 20 PJ pa contracted: gas contracts with O-I Australia, AGL Energy, Alinta Energy EnergyAustralia • Sanction expected by March 2017 for Sole gas into plant by March 2019 Manta (VIC RL/13,14,15; C
Slide 32: Executive management team
Managing Director Executive Director General Manager, Development General Manager, Operations General Manager, Exploration For personal use only David Maxwell Hector Gordon Duncan Clegg Iain MacDougall & Subsurface David Maxwell has over 30 years’ Hector Gordon is a highly Duncan Clegg has over 35 y
Slide 33: Reserves and resources calculation notes
The approach for all reserve and resource calculations is consistent with the definitions and guidelines in the Society of Petroleum Engineers (SPE) 2007 Petroleum Resources Management System (PRMS). The resource estimate methodologies incorporate a range of uncertainty relating to each of the key r
Slide 34: Glossary
$, A$ Australian dollars unless specified otherwise For personal use only Bbl barrels of oil boe barrel of oil equivalent bopd barrel of oil per day EBITDA earnings before interest, tax, depreciation and amortisation FEED Front end engineering and design kbbls thousand barrels LTIFR Lost Time Injury
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