January Phone: +44 (0)

Transcription

1 Dragon Oil plc Corporate presentation January 2010 Phone: +44 (0)

2 Forward looking statement This presentation contains statements that constitute "forward-looking statement". Forward-looking statements appear in a number of places in this presentation and include statements regarding Dragon Oil plc s (the "Company" or "Dragon Oil") intent, belief or current expectations with respect to its results of operations and financial condition. These statements reflect the Company s current views with respect to future events and are subject to certain risks, uncertainties and assumptions. Should one or more of the risks or uncertainties materialise, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this presentation as anticipated, believed, estimated, expected or intended. By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward-looking statements will not be achieved. The Company is under no obligation, and disclaims any obligation, to update or alter the forwardlooking statements included in this presentation, whether as a result of new information, future events or otherwise after the date of this presentation. 2

3 Introduction 3

4 History 1971 The company is incorporated and registered in Ireland under the name of Oliver Prospecting & Mining Co. Limited 1993 The name is changed to Dragon Oil plc Dragon Oil acquired in two steps 100% in a company, which had a 50% interest in the Larmag-Cheleken Joint Venture (LCJV). The remaining 50% of the LCJV was owned by Turkmenneft. The LCJV was signed in The Emirates National Oil Co. Ltd. (ENOC) L.L.C. (ENOC), owned by the Government of Dubai, acquired 46% in Dragon Oil plc. ENOC s shareholding increased to 69.4% subsequently following a mandatory offer for the share capital of Dragon Oil plc 1999 Dragon Oil signed the Production Sharing Agreement (PSA) with the Government of Turkmenistan to develop the Cheleken Contract Area in the Caspian Sea 2000 The PSA became effective 2001 Dragon Oil raised US$5.8m by way of a placing 2003 Dragon Oil raised US$18m by way of a placing, mainly to fund a marine 3D seismic survey of the entire Cheleken Contract Area 2005 Dragon Oil raised approx. US$124m by way of a placing (in two tranches) and approx. US$42m by way of an open offer to existing shareholders to fund drilling and non-drilling capital expenditure 4

5 The Production Sharing Agreement PSA defines terms of exploration and development of the Cheleken Contract Area for an initial period of 25 years with a right to negotiate an extension of no less than 10 years Dragon Oil has the right to explore and the obligation to develop oil and gas resources in the Area. Dragon Oil is obliged to provide the capital and expertise, subject to rights of cost recovery The oil and gas recovered is shared between the parties by reference to the level of production at a given time 950 km 2 with two offshore oil and gas fields, Dzheitune (Lam) and Dzhygalybeg (Zhdanov), in water depths of between eight and 42 metres There are currently 58 active wells producing from 13 platforms US$ 20 Capex vs production 50 Sharing of oil produced 80% Capital expenditure 60% 30 Gross field production 40% % kbopd 5-0% Working interest barrels Entitlement barrels m bbls Entitlement barrels rate

6 Reserves and resources As at 31 December 2008 Proved and Probable Remaining Oil and Condensate, Recoverable Reserves million barrels Gross field reserves to 1 May C Resources TCF Gross Gas Contingent Resources 3.2 Notes: 1. Based on the latest reserves certification by an independent energy consultant. 2. The Company's entitlement is 296 million barrels based on a number of significant assumptions (please refer to the Annual Report for the list of assumptions). Gubkin Extension Zhdanov Lam West Lam Main Cheleken Extension 6

7 Operational and financial overview 7

8 Trading Statement, 22 January 2010 Eight development wells put into production in 2009 Production hit landmark level of 50,000 bopd at the turn of Average daily production rate reached 44,765 bopd in 2009 (2008: 40,992 bopd) Entitlement rate was 58% vs 60% in 2008 Capex of US$317m spent on infrastructure (50%) and drilling (2008: US$287m) Cash balance of US$1,138m (31 Dec 2008: US$876m) no debt US$126m set aside for abandonment and decommissioning activities 10.5m barrels sold (2008: 7.5m barrels) at average realised price of US$62/bbl (2008: US$91/bbl) 8

9 Trading Statement, 22 January 2010 Dzheitune (Lam) B platform installed in December 2009 Astra jack-up rig secured for six months and currently drilling a development well from Dzheitune (Lam) B platform Two-year contract awarded for NIS Rig, which is expected to spud its first well during Q Iran Khazar jack-up rig drilling the Dzheitune (Lam) A/142 well Rig 40 platform-based rig drilling the Dzheitune (Lam) 13/143 well Total of 11 wells is planned for completion in 2010 With three wells coming on stream around the end of Q Group well positioned in drilling and facilities contracts for stronger growth in 2010 Continue to pursue growth opportunities through diversification Unlock further the value of our asset through gas monetisation 9