Otto Energy Limited · ASX:OEL
Otto Energy — Non-Deal Roadshow (August 2021)
27 slides from Otto Energy's roadshow presentation, Aug 25, 2021
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: 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 5: Corporate snapshot (ASX: OEL)
Corporate snapshot (ASX: OEL) CAPITAL STRUCTURE LIQUIDITY POSITION SHARE REGISTER COMPOSITION Shares on issue 4,795 M Cash (30 June 2021) US$11.1 M Corporate/strategic 49% Share price (09 Aug 2021) A$ 0.009 PANR stock * (09 Aug 2021) US$10.6 M Retail 47% Options and share rights 66 M Debt - drawn (3
Slide 6: 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 7: 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 8: 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 9: 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 DEPLOYED US$27.6M US$19.4M US$44.9M NET IP (BOEPD/MMCFD) 1800 BOEPD 8 MMCFED 600 BOEPD NET 2P RESERVES 3.3 MMBOE 26.1 B
Slide 10: Optimising captured resources
Optimising captured resources Creating value through leveraging organic options 1P Reserves: 4,051 MBoe 2P Reserves: 6,359 MBoe 3P Reserves: 8,874 MBoe Six wells (five are PDP Adds one additional well Adds one additional well and one, Green #3, is a (Green #4) plus 2,308 Boe (Green #5) plus 2,
Slide 11: Base plus infill upside potential outcomes
Base plus infill upside potential outcomes Production and capital expenditure profiles Otto production outlook: Base plus organic options Otto capital expenditure outlook: Base plus organic options (Mboe) (US$’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 12: Cost base and balance sheet strength combined with Fiscal Discipline
Cost base and balance sheet strength combined with Fiscal Discipline 12
Slide 13: 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 14: 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 15: Debt-driven leverage profile
Debt-driven leverage profile High confidence in abilities to service/reduce Production Available debt facilities (at 30 June 2021) 1,101 Mboe 946 US$25 M – Tranche A1 742 US$10 M – Tranche A21 US$20 M – Facility B (terms to be determined) 194 Debt balance (at 30 June 2021) Tranche A1 fully dra
Slide 16: Otto performance objectives
Otto performance objectives Maximise our base business while creating future value INORGANIC GROWTH BASE AND ORGANIC GROWTH OPTIONS OPPORTUNITIES PERFORMANCE OBJECTIVES Facilitated by underlying base business Base business + organic options (3-year group targets) Key targeting criteria Base business
Slide 17: Conventional Oil & Gas Focused – Inorganic Growth
Conventional Oil & Gas Focused – Inorganic Growth Evaluating Lower Risk, Higher Potential, Multi-well Exploitation Onshore / offshore optimized portfolios being marketed Privately held through mid-sized public entities aggressively seeking partnerships to leverage risks Availability of opportu
Slide 18: Future value creation
Future value Prospect portfolio generation/access creation Asset evaluation Acquisition of underdeveloped and under-valued Driven by a highly disciplined approach to Divestment of existing/swap capital management Company evaluation Sale of Otto Merge with aligned company Acquire Dividend r
Slide 19: Otto's shareholding in Pantheon Resources Plc
Otto’s shareholding in Pantheon Resources Plc Material value holding in Alaska pure play E&P Otto holds 14,272,592 shares in Pantheon Resources Plc (LSE: PANR) currently valued at approx. US$ 10.6 MM as at 9 Aug 2021. 1,2 Pantheon acreage map In addition to our Pantheon shareholding Otto Energy
Slide 20: 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 21: Pipeline Of Opportunities
Pipeline Of Opportunities Otto has assembled an exciting pipeline of upcoming activities 2021 2022 Q3 2021 Q4 2022 Q1 2020 Q2 2020 Q3 2020 Q4 2020 SM 71 Low-cost production Lightning Low-cost production Pillar 1 GC-21 Low-cost production US Gulf DTR-10 Coast CG 21 Recomplete Lightning Green 3, Green
Slide 22: Appendix
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Slide 23: 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 24: Matagorda County “Lightning”
Matagorda County “Lightning” Onshore gas asset offering both product and geographic diversification Hilcorp operated Deep seated structure trapping “Tex Miss” channel-levee complex sands Grand Slam Field Hilcorp operated Devon-Harrington Field Located south-central Matagorda County, Texas Hilcorp
Slide 25: Green Canyon 21 “Bulleit”
Green Canyon 21 “Bulleit” Deepwater GoM development that leveraged infrastructure for early 1st production Deepwater pliocene reservoirs on salt supported structure Located in 771 feet of water GC 21 discovery announced in June 2019, first production in October 2020 GC 21 Four previously drill
Slide 26: 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 27: 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