High Arctic Energy Services Corporate Update AGM May 13, 2014

Transcription

1 High Arctic Energy Services Corporate Update AGM May 13, 2014

2 Forward Looking Statements This presentation may contain information which is forward-looking and is subject to important risks and uncertainties. The results or events predicted in this information may differ from actual results or events. Actual results may differ materially from management expectations, as projected in such forward looking statements for a variety of factors, including market and general economic conditions and the risks and uncertainties detailed in the most recent Interim Financial Statements along with the Corporation s Management Discussion and Analysis and the Annual Information form for the year ended December 31, These documents can be found on SEDAR( Due to the potential impact of these factors, the Corporation disclaims any intention or obligation to update or revise any forward looking statements, whether as a result of new information, future events, or otherwise, unless required by applicable law. Page 2

3 Papua New Guinea Update Page 3

4 PNG OSL / Exxon -LNG Project Exxon announced on April 29 th that production had commenced on the first train of the LNG plant The second train should start production sometime in Q2 Over the project s expected 30 year timeframe, total forecast production includes 9.0 tcfof natural gas and 200+ million bbls of associated liquids Significant growth opportunity for aggregating gas reserves from P nyang field for a third LNG train Page 4

5 PNG LNG future development P nyang: Exxon/OSL -Reserves for LNG expansion Highlands Hides, Juha, Kutubu Exxon / OSL Supporting current LNG Plant Elk/Antelope : InterOil, Total, OSL Reserves for major LNG expansion Forelands : Talisman, Santos, Mitsubishi, Heritage, Horizon Potential source for third LNG expansion Page 5

6 Purchase of New Drilling Rigs Purchased 2 Heli-portable drilling rigs (rigs #115 & #116) subject to closing of acquisition AC self-erecting 1500 HP triple s Constructed in 2010/11 with one year of use to date Latest safety designs & automated drilling Can break down into 2700 kg loads Allows for various helicopter options Total cost estimated at $52M USD Rigs $29M Shipping $6M Refurbishment & Spare Parts $17M Page 6

7 Deployment of New Drilling Rigs Rig 115 Signed a 2 year drilling services contract with InterOil for drilling on 100% owned properties Anticipated annualized revenue of $30M USD for one rig with camp Targeted spud date Q Rig 116 No current contract in place Currently in discussion with various companies regarding potential drilling contracts Rig estimated to be available for use Apr 1, 2015 Page 7

8 Competitive Drilling Landscape Land Rigs: Nabors Drilling 2 Super Triples for use in the Hides field Heli-Portable Rigs: High Arctic 2 Rigs (115 & 116) circa Rigs under contract from OSL (103 & 104) circa Work over rig circa 2008 Parker Drilling 1 Rig circa mid 1970 s they are looking to sell this rig & exit the country Talisman 1 Rig circa mid 1970 s they are looking to sell this rig. Operated by Parker Drilling InterOil 2 Rigs circa early 1980 s currently operated by Simmons Drilling Western Drilling 1 Rig circa mid 1980 s currently no contracts Page 8

9 PNG Drilling Services contracted Rigs Operate 2 Heli-portable drilling rigs (rig #103 & rig #104) for Oil Search Ltd. Providing services to OSL since 2007 Have twice renewed the 3 year contracts with OSL Current contract expires June 30, 2016 Rig 104 will work for OSL through 2014 Rig 103 is contracted for approximately 1 year to InterOil for drilling on joint venture lands Own the only Heli-portable hydraulic workover rig in PNG (rig #102) Contract completed May 2014 Rig will be stacked for remainder of 2014 Page 9

10 Dura-Base Matting Over 10,000 rental mats in PNG PNG distributor rights The largest rental supplier of Dura-Base mats outside of the USA Possible expansion into similar countries with challenging environments Page 10

11 Staging Site Management In 2013 High Arctic was awarded an 18 month Material Handling Contract to supply Cranes, Forklifts, Trucks, Light Towers, Personnel, Training, and Materials Handling expertise. Before High Arctic With High Arctic Page 11

12 Canada Update Page 12

13 Snubbing Growth Opportunities Growing number of wells needed to provide future BC LNG feedstock High Arctic is well positioned to provide the needed completion services for these wells to our existing clients. BC Well Licence Authorizations for 2013 Company Aug YTD % of total Shell % Progress % Encana 58 10% CNRL 39 7% Tourmaline 26 5% Others 24 18% Total % HWO top clients These wells will require snubbing services Page 13

14 Canadian Snubbing Services 15 Stand Alone & 3 Rig Assist Units 14 Active Crews 2013 Annualized Utilization 36% Page 14

15 Investment Highlights Shares outstanding: 50,242,692 Share Price (as at May 9, 2014): $5.36 Market Cap: $269.3 million Net Cash (cash less debt): $36.2 million Enterprise Value: $233.1 million Trailing 12 Month EBITDA: $44 million EV/ EBITDA Multiple (12 months trailing): 5.3x Average Daily Trading Volume: 95,202 Page 15

16 Share Price Performance May 1, 2013 through April 30, 2014 Page 16

17 Dividend History Payout Ratio Approx. 18% Payout Ratio Approx. 22% Payout Ratio Approx. 25% Current Dividend Rates: Annual Dividend: $0.18 Payout Ratio 25% Yield 4.0% Page 17