Gulf Keystone Petroleum. Investor Presentation February 2009

Transcription

1 Gulf Keystone Petroleum Investor Presentation February 2009

2 Contents Company overview and strategy Algeria assets Kurdistan assets Activity schedule Key investment considerations 2

3 Company overview and strategy 3

4 Company overview Gulf Keystone is an independent oil & gas company listed on the AiM market of the London Stock Exchange focused on the exploration development and production of oil and gas in the Republic of Algeria and the Kurdistan Region of Northern Iraq Production Block 126 GKN/ GKS development plan approved by ALNAFT (effective from the 10 October 2007) Production from GKN-1 of 323,150 bbls during October 07 to June 08 (133,378 bbls entitlement basis) Development Successful 3 well appraisal on Hassi Ba Hamou (HBH) in 2008 following completion of the 2D and 3D seismic programmes Exploration 3 well HBH area exploration in well RM-1 a discovery, RM-2 follow up to RM-1 discovery spudded February 2009 Two Production Sharing Contracts (PSC s) signed in the Kurdistan Region of Northern Iraq Shaikan (GKP Operator) and Akri- Bijeel (MOL Operator), seismic completed, interpreted, ready to drill in

5 Company overview - history Offices currently in Bermuda, London, Algiers, Bir el Ater and Erbil 2001 Founded by UAE, Kuwaiti and US private equity Incorporated in Bermuda Awarded PSC Ferkane Perimeter Block 126 Northern Algeria 2004 Listed on the AiM Market of the London Stock Exchange in 2004 (GKP.L) raising $107mm 2005 Awarded 3 PSC s in 2005 for Hassi Ba Hamou (HBH) Central Algeria and Bottena Perimeter Block 129 and Benguecha Block 108/ 128b both in Northern Algeria British Gas farmed-in as Operator and strategic partner to HBH in 2006 for $55mm cash and a $30mm carry Placing to raise $21mm 2007 Offer for the Company by RAK Petroleum PCL subsequently terminated HBH 2D & 3D seismic completed Development Plan for GKN/ GKS fields in Ferkane Perimeter Block 126 approved Award of 2 PSC s, Shaikan and Akri-Bijeel in Kurdistan region of Northern Iraq 2008 Successful completion and test of HBH-4, HBH-5 & HBH-6 appraisal wells RM-1 announced as a discovery well Seismic acquired on Shaikan and Akri-Bijeel Placing to raise $50mm American Depositary Receipt s traded in the US over-the-counter securities market 2009 Commenced drilling of RM-2 5

6 Company overview - Management team Todd Kozel (1) Executive Chairman & Chief Executive Officer Ewen Ainsworth Finance Director John Gerstenlauer Chief Operating Officer Ali Al Qabandi (1) E.V.P Business Development Mohamed Messaoudi Country Manager Algeria/ Adnan Samarri Country Manager Kurdistan Ibrahim Alkhaldi (1) V.P MENA Region Chris Garrett V.P Operations & MD UK (1) Founder 6

7 Company overview - shareholder structure Shareholder structure AIM Symbol: GKP 368,008,215 common shares of $0.01 each outstanding. Further estimated 8,073,028 for options/ bonus on a fully diluted basis. Current Market Capitalisation: 52 million 1 Top institutional shareholders: Capital Research & Management Company Oppenheimer Funds Blakeney Management Gartmore Investment Managers RAB Capital Fidelity International Henderson Global Investors Standard Life Investments Artemis Investment Management Macquarie Bank HSBC Investments Market Street Bank Williams de Broe Note: (1) As at % 3% 50% 26% Management & Founders Top Institutions Other Institutions Private Individuals 7

8 Company overview - strategy & business plan Strategy Short term focus on maturing/ commercialising current asset portfolio Identify hydrocarbon provinces/ countries with the potential for major reserve additions without direct competition from major oil companies Build material portfolio in 3 core areas MENA and FSU Replicate transactions in a province/ country to build critical mass Leverage relationships and utilise intrinsic technical skills of indigenous employees to access these opportunities Realise value by bringing in partners to fund exploration/ appraisal/ development minimising call on equity and focusing investment on production 8

9 Algeria assets 9

10 Algeria assets - overview Hassi Ba Hamou Perimeter 4 blocks Part 317b1, part 347b, 348, 349b GKP 38.25%; BG 36.75%, operator; Sonatrach 25% Large acreage position of 12,825 km 2 GKN and GKS Field Block 126a Field Development Plan approval given in Jan 2008 GKP 60% WI Ben Guecha Permit 2 blocks 108, 128b GKP 75% WI Infrastructure Excellent proximity to existing and proposed gas pipelines for HBH Pipelines in place and proposed to supply the increasing demand of mainland Europe 10

11 Algeria assets - Hassi Ba Hamou History: Awarded in 6th Bid Round May In August 2006, Gulf Keystone signed an agreement with BG Group which completed in December Under the agreement, BG acquired 49% of Gulf Keystone s interest in Hassi Ba Hamou and assumed the role of operator GKP negotiated a $30 MM carry, a cash consideration of $55 MM and an additional deferred consideration contingent upon commercial reserves GKP s carry was used to fund GKP s share of the 2D and 3D seismic programmes in 2007 Success to Date: 2047 km 2D seismic have been acquired across large parts of the block and 533 sq km of 3D seismic across the HBH field / discovery A 6 well program (Phase 1) commenced on 16th December 2007 and completed in January 2009 HBH-4, HBH-5 and HBH-6 field appraisal wells completed and flowed gas successfully at between 9.5 mmscfd and 12.9 mmscfd RM-1 discovery well tested gas at a rate of 8.7 mmscfd The partners have elected to go into Phase 2 which requires 1 exploration well, 2 appraisal wells and 500 sq km of seismic in addition to the current Phase 1 work and 30% of original area relinquished RM-2 spudded on the 2 February

12 Algeria assets - Hassi Ba Hamou exploration/ appraisal 3 appraisal wells on the HBH field HBH-4, -5 & -6 3 exploration wells drilled HBHN-1 RM-1 (Success) FEG-1 * GKP estimate HBH Field 0.7 Tcf * A RM North RM-2 well HBHN-1 1 N HBH-1 HBH-2 HBH-4 HBH-6 Area now 50km relinquished BASE STRUNIAN TRUNCATION Carboniferous (FEG) RM-1 well HBH-3 HBH-5 12

13 Algeria assets - Hassi Ba Hamou field HBHN-1 HBH-2 HBH-6 HBH-3 HBH-5 P50 resources of 700 bcf (GKP estimate) 2009/ 2010 Front End Engineering Design Project Sanction 2010 Estimated plateau rate of 200 mmscfd First production expected in 2012/ 2013 HBH-1 HBH-4 10km 13

14 Algeria assets - Hassi Ba Hamou, Prospects & Leads RM North Lower Devonian Truncation Northern extension of RM HBH North HBH West Tournasian sands sitting above Strunian reservoir RBT HBH field look-alike. Tournasian/Strunian Truncation Trap RM GOB/GOB West Ordovician 4-way dip traps Separate closures to Hassi Allal-1 RM Deep East Intra-Lower Devonian HUC Truncation trap RM Deep South Intra-Lower Devonian-HUC 4-way dip trap Visean Prospects/Leads FEG (Lower Unit) Area now relinquished FEZ Discovery/FEZ Deep Lower Devonian discovery Deeper Untested Ordovician Potential Tournasian/Strunian Leads Lower Devonian Prospects/Leads Intra-Lower Devonian Leads Ordovician Leads Phase 1 Exploration Targets FEG Upper Unit/Unit 3/Unit 4 Phase 2 Prospects/Leads 14

15 Algeria assets - GKN and GKS field & Northern blocks GKN and GKS Field GKN/GKS oil fields development (60% GKP) Gross reserves of 3 mmbbls estimated from existing wells GKN-1, GKS-2* GKN-1 produced 323,150 bbls (133,378 bbls entitlement) from to Oil sales agreement signed with Sonatrach GKS-2 to be brought into production GKN-1 currently shut-in to be worked over with GKS-2, along with facilities upgrades and repair Production estimated by GKP at 3,000 bopd gross, 882 bopd entitlement basis after both wells worked over and brought on stream GKN-1 GKS-2 Northern Block Remaining commitment on Northern block: Benguecha Block 108/ 128b - 60 sq km 3D & 600 km 2D seismic, 1 exploration well and 1 appraisal well by January 2010 *GKP Estimate from

16 Kurdistan assets 16

17 Kurdistan assets - Kurdistan region of Iraq The Kurdistan Region of Iraq is located in the North eastern part of Iraq Region is approx 400 km x 120 km in size Limited oil & gas activity in last 30 years Significant discontinuity sanctions, wars Many un-drilled surface structures In the Kurdish Region of Iraq there have been less than 30 wells drilled up until (until the recent entry of DNO / TTOC) 300 km Multiple surface structures are evident from mapping in the Kurdistan Region of Iraq Map Source: Middle East Reference Map U.S. Central Intelligence Agency,

18 Kurdistan assets Kurdistan track record Tawke Shaikan Akri- Bijeel Taq Taq Tawke Field (DNO*) PSA signed 2004 Operating in Northern Kurdistan for 3 years Acquired 2D & 3D seismic Newly discovered Tawke field, number of different reservoirs, 10 wells drilled to date Tawke-1 well aggregate test rate of 23,000 bopd 42 km 12 pipeline to Turkey & Central Processing facility completed Commenced early production and field development Published gross recoverable oil reserves range from million barrels (current expected value 230 mmbo) (Source: DNO web site) 100 km Approx location of other companies assets (not to scale) Map Source: Iraq: Country Profile, 2003 * DNO and TTOC web sites Taq Taq Field (TTOC*) New activity started in late 2005 Acquired 2D seismic Drilled 6/7 wells, at least 3 different reservoir zones Aggregate flow rates from the Taq Taq-4 & Taq Taq-7 wells were 29,790 & 37,560 bopd respectively 18

19 Kurdistan assets GKP blocks Shaikan Gulf Keystone (Operator - 75%) MOL (Kalegran) (20%) Texas Keystone (5%) Committed work program 3 year initial exploration period 2 to 4 year optional exploration period 170 km 2D seismic Complete 1 exploration well Q to 25 year production period GKP Shaikan Block Dohuk Akri-Bijeel MOL (Kalegran) (Operator - 80%) Gulf Keystone (20%) Committed work program 3 year initial exploration period 50 km MOL Akri Bijeel Block 2 to 4 year optional exploration period 400 km 2D seismic Complete 1 optional exploration well to 25 year production period 19

20 Kurdistan assets GKP blocks Shaikan Akri-Bijeel 20

21 Kurdistan assets - location of GKP blocks Perenco Hillwood DNO Aspect Akri Bijeel Block Hunt Reliance DNO OMV ATT Addax Dana Herritage Shaikan Block Sterling Dana Western Zagros Petprime 21

22 Kurdistan assets - geochemical sampling Maturity increases towards the NW Surface seep (oil pool) Mild biodegradation Higher maturity Well production sample Mild biodegradation Higher maturity Well production sample Lowest maturity samples seem to occur in isolated area (Aqra type section) Biodegradation pattern less clear Is it related to sample type/location? Surface vs. subsurface sample? Solid vs. liquid sample? Akri-Bijeel Nondegraded Higher maturity Surface seep (bitumen) Mild biodegradation Moderate maturity Surface seep (bitumen) Undegraded Moderate maturity Surface seep (bitumen) Mild biodegradation Moderate maturity Degree of biodegradation may increase moving southwards? All samples indicate a Marine Carbonate source type Surface seep (bitumen) Mild biodegradation Moderate maturity Source predicted to be Jurassic Shaikan Surface seep (sat matrix) Mild biodegradation Moderate maturity Surface seep (bitumen) Heavy biodegradation Moderate maturity Surface seep (bitumen) Heavy biodegradation Lower maturity Surface seep (bitumen) Heavy biodegradation Lower maturity Surface seep (bitumen) Heavy biodegradation Moderate maturity Surface seep (bitumen) Heavy biodegradation Moderate maturity 22

23 Kurdistan assets - Shaikan seismic programme Shot 171 km of 2D seismic to date Processing completed Interpretation ongoing SN SN SN SN SN SN SN SN SN SN S N 2km 23

24 Shaikan Reservoirs Period Epoch / Stage Formation (Prognosed Thickness m) Depth (m) Surface Lithology Petroleum System Reservoir Fm Reservoir Barrels in Place (MMBBL) P90 P50 CRETACEOUS MAASTRICH- TIAN ALBIAN VALANGINIAN Late Aqra (400+) Qamchuqa (250) Garagu / Chia Gara (200) Gotina/Najmah (100) Sargelu (100) Bituminous Limestone Marly limestone Limestone and Dolomite Oolitic Limestone Oolitic Limestone Black Lst and shale R R So Qamchuqa C. Gara / Garagu / Gotina / Najmah Sehkaniyan Kurre Chine Chia Zaira Total JURASSIC TRIASSIC MID Early LATE MIDDLE Alan / Mus / Adaiyah (Sehkaniyan) (250) Butmah (450) Kurre Chine (500) Geli Khana (500) Anhydrite / oolitic lst Massive Lst, w/ thin Shale beds Dolomite and Anhydrite streaks Shaly limestone R Se R So Note: Resource numbers are based on preliminary seismic time maps and projections made from these. Assumptions made about the reservoir parameters used in the calculations are based on either published data from analogous fields in Kurdistan and Northern Iraq or the Company s best estimates at this time. The above totals assume exploration success and that all potential reservoirs listed are full to spill. These are GKP estimates and subject to change / refinement as ongoing work progresses. EARLY Beduh (80) Mirga Mir (150) Dolomite and Anhydrite Se Se PERMIAN LATE 2980 Chia Zaira with Satina TD: 3300m Lst and dolomite R R Reservoir So Source Se Seal Nb. Some reservoirs contain intraformational seals 24

25 Akri-Bijeel Prospects & Leads Large surface anticline (80 Sq. Km) Reservoirs : Jurassic, Triassic Sub-thrust Lead (>20 Sq. Km) Reservoirs : Cretaceous, Jurassic, Triassic Large surface anticline (>80 Sq. Km) Reservoirs : Jurassic, Triassic Geological and Prospect Map of the Akri-Bijeel Block, Kurdistan Region, Iraq 0 10km 1:50,000 Coordinates measured in UTM projection 38 O N zone and decimal degrees in lat-long projection WGS84 reference ellipsoid Populated Area River Akri-Bijeel Block Seismic line Prospects Well defined inverted dip/fault closure (21 Sq. Km) Reservoirs : Cretaceous, Jurassic, Triassic) GKP preliminary view from it s interpretation of the seismic

26 Kurdistan Milestones Shaikan Acquired 171 km of 2D Seismic, interpreted and well location determined Rig contract signed and in transit to Kurdistan Drilling site for Shaikan-1 complete. Pipe yard established with long lead items in stock Akri-Bijeel Acquired 442 km of 2D Seismic Well to follow completion of Shaikan -1 well 26

27 Activity schedule 27

28 Schedule of activity 2008 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Algeria HBH-4 HBHN-1 RM-1 FEG-1 HBH-5 HBH-6 Kurdistan Shaikan Seismic Akri Bijeel Seismic 2009 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Algeria HBH Phase 2 Wells HBH-6 RM-2 HBH Phase 2 Seismic HBH Development Kurdistan Shaikan-1 Akri Bijeel-1 Actual Provisional 28

29 Key investment considerations 29

30 Key investment considerations Strategic Advantage Attractive Asset Base Material Near-Term Upside Potential Proven management and board relationships provide access to business development Algerian and Kurdistan subsidiaries operated by local management with local knowledge Success on current asset base will enable portfolio growth to third core area * GKP estimate High impact assets located in 2 world class hydrocarbon provinces Full cycle portfolio Production - targeting 800 bopd net Development HBH gas field targeting first gas in 2012/ 2013 with gross resources of 0.7 tcf * Exploration - Algeria RM-1 discovery Kurdistan Shaikan and Akri-Bijeel PSCs located in a potential prolific hydrocarbon basin Algeria RM-1 discovery in HBH could significantly increase current resource size Active drilling schedule through to Q Kurdistan Shaikan exploration well currently planned to be drilled in H1/09 targeting a billion reservoir bbls or more* Akri-Bijeel exploration well currently planned to be drilled in H2/09 World class acreage and reserves position with significant upside potential 30

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