Tullow Oil Plc · LSE:TLW
Tullow Oil — Investor Day (June 2014)
91 slides from Tullow Oil's investor day presentation, Jun 25, 2014
Slide 1: Capital Markets Day 2014
Bis. CAPITAL MARKETS DAY 2014 25 June - London TULLOW
Slide 2: Disclaimer
2014 Capital Markets Day Disclaimer This presentation contains certain forward-looking statements that are subject to the usual risk factors and uncertainties associated with the oil and gas exploration and production business. Whilst Tullow believes the expectations reflected herein to be reasonabl
Slide 3: Agenda
2014 Capital Markets Day Agenda Time Topic Main presenter Q&A 12.30 Introduction Aidan Heavey 12.45 West Africa Business David Lawrie David Lawrie, Paul McDade and Angus McCoss 13.45 East Africa Business Gary Thompson Gary Thompson, Paul McDade and Angus McCoss 14.45 Coffee break 15.15 Exploration I
Slide 4: Speaker biographies
2014 Capital Markets Day Speaker biographies David Lawrie Gary Thompson Vice President, West & North Africa Vice President, South & East Africa David joined Tullow in 2011 and is the Regional Vice Gary joined Tullow in 2013 and is the Regional Vice President for President for West & North Africa and
Slide 5: Introduction
2014 Capital Markets Day INTRODUCTION Aidan Heavey
Slide 6: Our Strategy
2014 Capital Markets Day Our Strategy Additional cash flow from new production Monetisation High Margin Exploration Selective Options & Production and Development Portfolio Cash flow Appraisal Management Costs & Dividends Additional Surplus Cash Exploration, Cash Distribution • Material cash flow ge
Slide 7: West Africa Business
2014 Capital Markets Day WEST AFRICA BUSINESS David Lawrie
Slide 8: Our strategy
2014 Capital Markets Day Our strategy Additional cash flow from new production Monetisation High Margin Exploration Selective Options & Production and Development Portfolio Cash flow Appraisal Management Costs & Dividends Additional Surplus Cash Exploration, Cash Distribution • Material cash flow ge
Slide 9: Regional investment highlights
2014 Capital Markets Day Regional investment highlights West & North Africa 9 Countries 39 Licences 28 Years experience c.88,000 Sq km 65,000 boepd 665.6 mmboe Acreage 2013 production Reserves & Resources • Material business with potential to generate over $m West & North Africa Operating Cash Flow
Slide 10: Non-operated Production
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY West Africa Business NON-OPERATED PRODUCTION
Slide 11: Non-operated - strengths and opportunities
2014 Capital Markets Day Non-operated - strengths and opportunities Material portfolio of high margin resources High margin oil fields give broad technical base with potential to drive future value growth Influencing non-operated activities Learning from and challenging operators to transfer knowled
Slide 12: Non-operated – sustaining high margin production
2014 Capital Markets Day Non-operated – sustaining high margin production • Good technical work has delivered investment opportunities High value incremental • High return investments compete strongly for capital within investments can sustain Tullow’s portfolio net production around • Medium term i
Slide 13: Non-operated case study: Gabon
2014 Capital Markets Day Non-operated case study: Gabon Gabon net production profile 16,000 14,000 • High value infill drilling has offset decline 12,000 • Tullow technical influence impacting Operator 10,000 decisions boepd 8,000 6,000 • Sputnik, pre-salt exploration opportunity, offers 4,000 mater
Slide 14: Non-operated case study: Equatorial Guinea
2014 Capital Markets Day Non-operated case study: Equatorial Guinea • Use of 4D seismic data to optimise infill drilling - First iteration in 2010 (learning ahead of use at Jubilee & TEN) - Next campaign planned for late 2014/15 (Ceiba) • Outstanding results achieved on Ceiba - Initial 20,000 bopd g
Slide 15: Ghana Operated Activity
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY West Africa Business GHANA OPERATED ACTIVITY
Slide 16: Ghana – long-term value generation
2014 Capital Markets Day Ghana – long-term value generation World class fields Up to c.4 billion barrels of high quality oil in place, with additional gas in place of up to c.4 tcf Strong track record Experienced team with strong track record of delivery through all phases of life cycle Visible futu
Slide 17: World class fields
2014 Capital Markets Day World class fields JUBILEE OIL Jubilee TEN MTA GAS TEN OIL Material resource base will drive long-term value growth Slide 17
Slide 18: Sustainable production and cash flow
2014 Capital Markets Day Sustainable production and cash flow Ghana gross production profile 250 • Gross production at around Jubilee to be developed TEN to be developed (80:20 oil:gas) Jubilee Upside MTA TEN Upside (45:55 oil:gas) 200,000 boepd beyond 2025 200 • c.$2bn annual potential net pre- tax
Slide 19: Strong track record – Opex management
2014 Capital Markets Day Strong track record – Opex management Jubilee opex vs production 14 120 • Direct operating costs benchmark Opex Oil Production favourably with identified cost 12 100 reduction areas 10 • Indirect operating costs seeing some Total Opex US$/boe* 80 ‘000 bopd Gross 8 growth ahe
Slide 20: Strong track record – potential to increase capacity
2014 Capital Markets Day Strong track record – potential to increase capacity FPSO capacity improvements • Current oil capacity Work Work Work completed in progress outstanding - Constrained by gas export infrastructure - On track to deliver 100,000 bopd in 2014 Oil optimisation Run down Run down Pu
Slide 21: Visible future growth – delivering Jubilee upside
2014 Capital Markets Day Visible future growth – delivering Jubilee upside 2P recovery • Additional wells identified to develop remaining resources • Further sub-sea infrastructure to be installed to extend resource reach • Investing in technology levers to increase recovery factors Update Reservoir
Slide 22: Visible future growth – TEN development overview
2014 Capital Markets Day Visible future growth – TEN development overview Base development case • 300 mmboe reserves being developed • 24 well development • Gross development capex of $4.9 billion • Leased FPSO, capacity of 80,000 bopd Mid-2016 start up • 10 wells on stream at start up; 7 drilled to
Slide 23: Visible future growth - TEN Project on track
2014 Capital Markets Day Visible future growth - TEN Project on track Execution schedule with strategic milestones 2013 2014 2015 2016 ACTIVITY Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 • Over 2 million man-hours General Milestones All Major Contracts Awarded Mobilise 1st URF Vessel to Ghana work
Slide 24: Visible future growth – monetising gas resources in Ghana
2014 Capital Markets Day Visible future growth – monetising gas resources in Ghana • Up to c.4 tcf gross potential gas resource to be monetised • GNGC gas infrastructure project creates sufficient capacity to take Jubilee and TEN gas • Expected completion in Q4 2014 • Future value opportunity as dom
Slide 25: Strong local relationships
2014 Capital Markets Day Strong local relationships 2013 • Employment: Socio-economic contribution - 266 Ghanaians employed, 87% of permanent staff • Procurement: - $438 million spent with 740 local companies 2010-2013 - ~50% of total 2013 spend with local companies and international businesses regi
Slide 26: Conclusion
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY West Africa Business CONCLUSION
Slide 27: Investment highlights
2014 Capital Markets Day Investment highlights • Material business with potential to generate over $2.5bn per annum of pre-tax operating cash flow • Rising production base to over 100,000 boepd by 2017; significant future value growth • Balanced fiscal regimes which encourage investment • Strong rel
Slide 28: East Africa Business
2014 Capital Markets Day EAST AFRICA BUSINESS Gary Thompson
Slide 29: Our strategy
2014 Capital Markets Day Our strategy Additional cash flow from new production Monetisation High Margin Exploration Selective Options & Production and Development Portfolio Cash flow Appraisal Management Costs & Dividends Additional Surplus Cash Exploration, Cash Distribution • Material cash flow ge
Slide 30: Investment highlights
2014 Capital Markets Day Investment highlights • Full life cycle regional scale E&P business • Two basins discovered with over 300,000 bopd potential • Large yet-to-find upside from basin opening exploration campaign • Governments and partners aligned for earliest possible first oil • Good progress
Slide 31: Creating a material value regional oil business
2014 Capital Markets Day Creating a material value regional oil business Major resources – A new oil province Two major oil basins already discovered with large upside potential to be tested across 12+ basins; Multi basin opening exploration focus Leading regional position Significant mainly operate
Slide 32: A New Oil Province
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY East Africa Business A NEW OIL PROVINCE
Slide 33: Major oil resources discovered
2014 Capital Markets Day Major oil resources discovered Potential new oil province • Prospective acreage covers 12+ basins • Two established as major oil basins - Lake Albert - South Lokichar • Significant resources discovered - Large yet to find upside • Expect to test nine new basins by end 2015 W
Slide 34: Exploring Kenya & Ethiopia’s significant resource potential
2014 Capital Markets Day Exploring Kenya & Ethiopia’s significant resource potential The following basins will be tested in 2014/2015 Date Chew Bahir South Basin: Gardim In progress North Kerio Basin: Kodos 3Q 2014 Turkana Central Basin: Epir 3Q 2014 Turkana North Basin: Engomo 4Q 2014 North Lokicha
Slide 35: Case Study: Sudan analogue
2014 Capital Markets Day Case Study: Sudan analogue Sudan Production Milestones 600 • 1995: Block 6 relicenced to CNPC 500 • 1996: Early production scheme (c.5mbd) • 1997: Greater Nile Blocks and Block 5A 400 relicenced – path open to development Kbopd 300 • 1999: Greater Nile project & export pipel
Slide 36: Leading Regional Position
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY East Africa Business LEADING REGIONAL POSITION
Slide 37: Building scale, equity, opportunity and value
2014 Capital Markets Day Building scale, equity, opportunity and value • First mover access to major frontier acreage in Uganda • Perseverance and resilience - First discovery 2006 & major discoveries 2008+ • Built on Tullow’s initial Uganda position - Acquisitions and farmouts realise value & stren
Slide 38: Material full cycle E&P business established
2014 Capital Markets Day Material full cycle E&P business established Access & Explore Regional exploration & appraisal success – 87% at $1.95/bbl. Leveraged to multi basin opening exploration & upside value. Appraise Successful Ugandan appraisal - 1.7 Bbo; $2.9 bn monetised by farmout. Leveraging U
Slide 39: Developing Discovered Resources
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY East Africa Business DEVELOPING DISCOVERED RESOURCES
Slide 40: Uganda – development status
2014 Capital Markets Day Uganda – development status Project definition being finalised 250 • Appraisal programme completed • Development costs reduced by 30% 200 200 • Kingfisher PL awarded, all EA2 Field Development plans submitted to GoU , Gross Production (kbopd) remaining EA1 plans to be submit
Slide 41: Kenya development plans rapidly advancing
2014 Capital Markets Day Kenya development plans rapidly advancing Explore, appraise and develop simultaneously • Exploration and appraisal drill out by end 2015 - 600 mmbo Pmean gross resources discovered to date • Appraisal Area of Interest (AOI) established • Extended well tests being planned • D
Slide 42: Regional crude oil export pipelines
2014 Capital Markets Day Regional crude oil export pipelines • Regional pipeline agreed - Governments across region supportive 600 km • Significant progress on technical design 860 km - Routing and environmental screening completed - Conceptual design studies completed - Buried pipeline - Flow assur
Slide 43: Marketing and transporting high quality crude oil
2014 Capital Markets Day Marketing and transporting high quality crude oil • Ultra low sulphur, intermediate API gravity - Comparable to Minas, Cabinda • Very low level of impurities - TAN, nitrogen, metals etc • High proportions of Distillates and VGO - Highest unit value cuts • Transportation logi
Slide 44: Execution Capability
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY East Africa Business EXECUTION CAPABILITY
Slide 45: Exploration operations capability
2014 Capital Markets Day Exploration operations capability Kenya well costs Since 2004 50 • 104 exploration and appraisal wells & sidetracks - 77 as operator 40 • 40 wells tested both production & injection • 57,700 sq km of FTG surveys – all as operator Total well costs (US$ million)* • 12,362 km 2
Slide 46: Effective appraisal capability
2014 Capital Markets Day Effective appraisal capability Uganda – Buliisa example 3D - Attributes • Two 3D surveys (649 sq km); 30 appraisal wells & sidetracks; well tests on 25 wells • Production and interference testing, water injection, injection of viscosified water • Horizontal well successfully
Slide 47: Shortening appraisal timelines
2014 Capital Markets Day Shortening appraisal timelines ASSET 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Kingfisher EA2 Buliisa EA1 Buliisa Kaiso Tonya Kaiso Tonya Kingfisher Buliisa FID Uganda Energy Africa purchase South Lokichar Sth. Lokichar FID Kenya Tullow Farm-in AOI Sig
Slide 48: Executing developments in East Africa
2014 Capital Markets Day Executing developments in East Africa Ugandan and Kenyan discoveries Similar development have much in common concepts • High angle/horizontal wells. Artificial lift to Good quality waxy, high maximise productivity and minimise well numbers viscosity crude • Water injection t
Slide 49: Uganda development optimisation and Capex savings
2014 Capital Markets Day Uganda development optimisation and Capex savings • Development optimisation and Capex reduction $3bn Capex cost reduction 4% programme in 2013/14 Reduction in 9% Facilities Capex Reduction in • Capex reduced from c.$11bn to c.$8bn Well & Pad Costs - Tullow’s c.$6/bbl compet
Slide 50: Management of surface risks
2014 Capital Markets Day Management of surface risks Local Content Social Performance • Integrated into core business • Established SP functions – land access & water capability • Local Content Task Force • Robust EHSIA strategy • Strengthening supplier development & contractor • Strengthening contr
Slide 51: Conclusion
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY East Africa Business CONCLUSION
Slide 52: East Africa Business key messages
2014 Capital Markets Day East Africa Business key messages Full life cycle regional scale E&P business Two basins discovered with over 300,000 bopd potential Large yet-to-find upside from basin opening exploration campaign Tullow has the people & capability to successfully deliver the East Africa Bu
Slide 53: Exploration
2014 Capital Markets Day EXPLORATION Ian Cloke
Slide 54: Our strategy
2014 Capital Markets Day Our strategy Additional cash flow from new production Monetisation High Margin Exploration Selective Options & Production and Development Portfolio Cash flow Appraisal Management Costs & Dividends Additional Surplus Cash Exploration, Cash Distribution • Material cash flow ge
Slide 55: Structured to continue strong exploration performance
2014 Capital Markets Day Structured to continue strong exploration performance 2007-2013 1.4 $3.3 210 5 770% 330,000 Billion boe /boe Discovered resource Finding costs* E&A Team Basins opened Production Replacement Sq km gross acreage Net Contingent Resource Additions mmboe / year 300 • We found & c
Slide 56: Where we explore: Africa & Atlantic for light oil
2014 Capital Markets Day Where we explore: Africa & Atlantic for light oil North Atlantic North Atlantic Exploration Campaign & Business Development Central Atlantic Central Major Exploration Atlantic East African Campaign Launched Margin Rift Basins Guyanas Margin Equatorial Atlantic Exploration Ca
Slide 57: How we explore: our process works
2014 Capital Markets Day How we explore: our process works $600M $1,000M Risked upside* Monte Carlo simulation of Prospect & Lead Inventory (P10 = 4.3 Bbo) within full potential of plays & basins (6.6 Bbo) Slide 57
Slide 58: Balanced investment across the portfolio
2014 Capital Markets Day Balanced investment across the portfolio Frontier Core South Atlantic Margins East African Rift Basins Low cost options give exposure to upside 10 Bbo STOIIP found in ∼40 Bbo potential Older turbidites beneath shelf (low cost) 2 new oil rift basins opened 2006 & 2012 Explora
Slide 59: Exploring for high value oil
2014 Capital Markets Day Exploring for high value oil Higher profitability associated with higher oil reserve mix Oil finding principles 100% • Focus on finding high value producible light oil 80% • Oil is multiples more valuable than gas High Value Oil 60% • Oil is easier to commercialise Return on
Slide 60: Cost efficient exploration $3.3/boe (2007-2013)
2014 Capital Markets Day Cost efficient exploration $3.3/boe (2007-2013) 900 Potential “Kick” in East African Rift Basins 3 core campaigns < $3.3/boe 800 Creaming Curve • East African Rift Basins $1.95/boe Net Contingent Resources Additions from E&A (mmboe) - Investing in a major winner 700 3 core c
Slide 61: Costs & well complexity impact global exploration industry
2014 Capital Markets Day Costs & well complexity impact global exploration industry Deepwater and Land cost analysis indexes Cost escalation 250 • Costs doubled over 5 year boom (2005-9) 200 Cost Index (2000=100) • Increased again after Macondo (2010) 150 • Onshore shale activity boom raises costs W
Slide 62: Shifts of emphasis within exploration portfolio for value
2014 Capital Markets Day Shifts of emphasis within exploration portfolio for value Uruguay Ghana Liberia, Sierra Leone Guyana Higher cost / Lower non-technical risk Lower cost / Higher non-technical risk Suriname Gabon Namibia Netherlands Uganda Guinea Norway Ethiopia Mauritania Kenya Madagascar Pas
Slide 63: E&A people & portfolio
2014 Capital Markets Day E&A people & portfolio Age Diversity People 50 • Leading demographics despite ‘Industry Crew Change’ 40 • 195 petroleum geoscientists with 15 years average oil 30 finding experience 20 • 15 Global Exploration Leaders with 30 years average 10 oil finding experience 0 • Very h
Slide 64: Core Campaigns
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY East Africa Development Business CORE CAMPAIGNS
Slide 65: East African onshore Rift Basins Campaign
2014 Capital Markets Day East African onshore Rift Basins Campaign Uganda Lake Albert Rift Basin (1st phase) East African Rift Basin Volumes • New oil basin opened 2006 • 91% E&A success 2006-2014 (88 wells) • Well cost reduction & smart well trials during E&A • Pioneering R&D (FTG, Ambient Seismic,
Slide 66: Kenya onshore Rift Basins transformational oil opportunity
2014 Capital Markets Day Kenya onshore Rift Basins transformational oil opportunity South Lokichar ultimate potential & beyond… • Eight oil discoveries (2012-2014) • High value resource currently being drilled-out • Rapidly appraise in parallel with development planning • Basin drill-out attempts to
Slide 67: Opening phase of West African Margin Campaign
2014 Capital Markets Day Opening phase of West African Margin Campaign Tano Basin opened offshore Ghana • Jubilee giant oil discovery led industry shift • Campaign hit the N/G sweetspots • Tullow E&A wells drilled with 80% success • ∼ 4.6 billion boe potential gross in place Pursuing the Jubilee pla
Slide 68: West African near field exploration in producing heartlands
2014 Capital Markets Day West African near field exploration in producing heartlands Oil field & production plateau extensions • Numerous near field & near infrastructure exploration & appraisal prospects in Ghana, Gabon, Equatorial Guinea, Cote d’Ivoire, Congo B • High value & cost effective increm
Slide 69: North Atlantic Continental Shelf Campaign
2014 Capital Markets Day North Atlantic Continental Shelf Campaign Barents Sea frontier exploration • Wisting shallow giant oil discovery • Bjaarland & Hansel to test 500mmbo upside • CSEM & HiFi 3D seismic proprietary insights • Exploring for regional follow-up Norwegian & North Sea near-infrastruc
Slide 70: Exploration Business Development & Frontier Campaigns
2014 Capital Markets Day 2014 CAPITAL MARKETS DAY East Africa Development Business EXPLORATION BUSINESS DEVELOPMENT & FRONTIER CAMPAIGNS
Slide 71: Selecting our next New Frontiers for sustained value growth
2014 Capital Markets Day Selecting our next New Frontiers for sustained value growth Directed by continental scale geology • Fundamental geology locates possible oil basins • Staying clear of expensive ‘feeding frenzies’ Early business integration • Integrate commercial & economic insights • Conside
Slide 72: Central Atlantic Margin Campaign
2014 Capital Markets Day Central Atlantic Margin Campaign Mauritania Outboard Plays Mauritania deepwater turbidites (1st phase) • Fregate-1 discovers over 30m light oil & condensate • Commercialisation options under review (high costs) • Follow-up potential of new oil play being high-graded • Campai
Slide 73: Next growth – frontier exploration examples
2014 Capital Markets Day Next growth – frontier exploration examples Namibia reachable turbidites • Older turbidites beneath shelf (low cost) • Oil system established by Wingat-1 (HRT) • New 3D survey highlights 2015 prospect • Albatross prospect; 422 mmbo (gross unrisked mean), 1093 mmbo (P10), CoS
Slide 74: Exploration investment highlights
2014 Capital Markets Day Exploration investment highlights PEOPLE Industry recognised leading oil finders over last 5 years TRACK RECORD 200mmboe/yr (average 2007-2013 @ $3.3/boe; $4.4/boe for 222mmboe in 2013) PORTFOLIO Industry leading positions in hottest new provinces (6.6 Bboe risked upside) PR
Slide 75: Funding Strategy
2014 Capital Markets Day Tullow Oil June 2014 Capital Markets Day Brian Williams Vice President Corporate Finance FUNDING STRATEGY Brian Williams
Slide 76: Our Strategy
2014 Capital Markets Day Our Strategy Additional cash flow from new production Monetisation High Margin Exploration Selective Options & Production and Development Portfolio Cash flow Appraisal Management Costs & Dividends Additional Surplus Cash Exploration, Cash Distribution • Material cash flow ge
Slide 77: Funding strategy designed to support business strategy
2014 Capital Markets Day Funding strategy designed to support business strategy Business strategy Funding strategy Additional cash flow from new production Maintain • To support the business model appropriate • Target minimum headroom liquidity • Continue to optimise debt capacity High Monetisation
Slide 78: Funding initiatives leverage business strengths
2014 Capital Markets Day Funding initiatives leverage business strengths Business Strengths Funding Initiatives 1. Proven track record: • E&A success Portfolio • Development project execution Commercial Management Operating • Strong long standing relationships in Africa Bank Facilities $2.9bn Uganda
Slide 79: Corporate bonds enhance Tullow’s debt capital structure
2014 Capital Markets Day Corporate bonds enhance Tullow’s debt capital structure Commercial bank debt Corporate bonds New source of capital reduces dependency on banks Limited pool of banks Deep, liquid market Portfolio mix supports different financing structures Asset based, secured EBITDA based, u
Slide 80: Debt capital structure has evolved
2014 Capital Markets Day Debt capital structure has evolved Debt maturity profile Key metrics $mm Commitment size Maturity $mm 31 May 2014 RBL 3,500 Dec 2019 Cash and cash equivalents 430 Corporate Facility 750 Apr 2017 Debt outstanding 6% Senior Notes 650 Nov 2020 RBL Facilities 1,550 6¼% Senior No
Slide 81: Disciplined financial management policies
2014 Capital Markets Day Disciplined financial management policies Business Risk Profile Financial policies 1. Maintain a well funded balance sheet Exploration-led growth strategy • Provide ample liquidity • Access to flexible and diversified funding sources 2. Apply a prudent financial approach Cap
Slide 82: Historical performance key metrics
2014 Capital Markets Day Historical performance key metrics Adj. EBITDAX ($mm) 1,847 1,779 1,908 • Strong growth in Adjusted EBITDAX driven by increasing 800 production 2010 2011 2012 2013 Capital investment ($mm) • Over $6.3bn of capital investment over the past 4 years 1,235 1,432 1,870 1,800 1
Slide 83: High margin production and competitive cost base
2014 Capital Markets Day High margin production and competitive cost base Realized oil price per bbl ($)1 Operating costs per boe ($)2 Brent avg. 79.5 111.3 111.7 108.7 WTI avg. 79.6 95.1 94.1 98.0 108.0 108.0 16.5 105.7 14.6 13.5 78.0 12.5 2010 2011 2012 2013 2010 2011 2012 2013 Depletion, deprecia
Slide 84: Tullow is a well-funded company
2014 Capital Markets Day Tullow is a well-funded company Managed with a prudent financial approach Ample liquidity headroom to fund planned capital expenditures Quality and highly cash flow generative portfolio of producing assets Multiple sources of capital, including selective monetisation of asse
Slide 85: Strategy & Portfolio Management
2014 Capital Markets Day STRATEGY & PORTFOLIO MANAGEMENT Les Wood
Slide 86: Strategy in action
2014 Capital Markets Day Strategy in action Business strategy Strategy execution Additional cash flow from new production • Grow and develop our commercial reserves to provide strong, stable cash High Monetisation Margin Exploration and Options & Selective flows Production Portfolio Development Appr
Slide 87: Portfolio management environment
2014 Capital Markets Day Portfolio management environment Recent market environment • E&P sector has been out of favour • Majors focusing on divestments & cash returns to shareholders rather than acquisitions • Small E&Ps are funding constrained • Low levels of M&A activity in last 2 years; graduall
Slide 88: Monetising options and portfolio management
2014 Capital Markets Day Monetising options and portfolio management Portfolio management motivation • Capital allocation: ensuring right balance of Exploration, Developments and funding • Optimising exposure: right equity at right stage of value chain • Licence commitments: retain flexibility where
Slide 89: Tullow additional value potential being created
2014 Capital Markets Day Tullow additional value potential being created Exploration • Industry-leading acreage Development position, strong track record • Value driven, flexible programme ($0.6-1bn) Production • Strong set of investment options, good economic metrics • Quality driven access (18 • T
Slide 90: Closing Remarks
2014 Capital Markets Day CLOSING REMARKS Ian Springett
Slide 91: Tullow Oil plc
2014 Capital Markets Day Download the Tullow Investor Relations and Media App from the Apple and Android stores: Tullow Oil plc 9 Chiswick Park 566 Chiswick High Road London, W4 5XT United Kingdom Follow Tullow on: Tel: +44 (0)20 3249 9000 Fax: +44 (0)20 3249 8801 Email: chris.perry@tullowoil.com We