Bridge Energy ASA. Corporate Presentation March 2013

Transcription

1 Bridge Energy ASA Corporate Presentation March 2013

2 Disclaimer This presentation and its appendices (together the Presentation ) have been prepared and delivered by Bridge Energy ASA ( Bridge Energy or the Company ). The Presentation and its contents are strictly confidential and may not be reproduced or redistributed, in whole or in part, to any other person than the intended recipient. The Presentation is prepared for discussion purposes only. The Presentation does not constitute, and should not be construed as, any offer or invitation or recommendation to buy or sell any of the securities issued by the Company and does and will not constitute or form or be part of any offering material. The Presentation contains information which has been sourced from third parties believed to be reliable, but without independent verification. The Presentation contains certain forward-looking statements relating to the business, financial performance and results of the relevant issuers and/or industries and markets. These statements may contain words as will, expects, anticipates, believes, estimates and words of similar import. Any forward-looking statements and other information contained in this Presentation, including assumptions, opinions and views cited from third party sources are solely opinions and forecasts which are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. As such by the nature of any forward looking statement, relying on such statements involves risk. This Presentation has not been reviewed or registered with any public authority, stock exchange or regulated market place, hereunder the Oslo Stock Exchange and the UK Financial Services Authority. The shares of the Company have not and will not be registered under the U.S. Securities Act or any state securities laws, and may not be offered or sold within the United States, or to the account or benefit of U.S. Persons. No part of this document may be copied or duplicated in any form or by any means or redistributed without the written consent of the Company. The distribution of this Presentation is in certain jurisdictions is restricted by law, including (but not limited to) USA, Canada, Japan, Australia and Hong Kong. Persons into whose possession this Presentation may come are required to inform themselves about and to comply with all applicable laws and regulations in force in any jurisdiction in or from which it invests or receives or possesses this Presentation and must obtain any consent, approval or permission required under the laws and regulations in force in such jurisdiction. By attending or receiving this Presentation you acknowledge that you will be solely responsible for your own assessment of the information herein, the market and the market position of the Company and the relevant securities and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of any relevant investments. Neither Bridge Energy nor any subsidiary undertakings or any such person s affiliates makes any undertaking, representation or warranty (express or implied) as to the accuracy or completeness of the information (whether written or oral and whether or not included in this Presentation) concerning the matters described herein. Neither Bridge Energy nor any subsidiary undertakings or any such person s affiliates accepts any liability whatsoever as to any errors, omissions or misstatements contained herein and, accordingly, neither Bridge Energy nor any subsidiary undertakings or any such person s affiliates, officers, employees, accepts any liability whatsoever arising directly or indirectly from the use of this Presentation or the information included herein. The Presentation speaks and reflects prevailing conditions and views as of. It may be subject to corrections and change at any time without notice. Neither Bridge Energy nor any subsidiary undertakings or any such person s affiliates intend to, and neither the delivery of this Presentation or any further discussions with any recipient shall, under any circumstances, not create any implication that the Company assumes any obligation to, update or correct the information herein. Nor is this Presentation an implication that there has been no change in the affairs of the Company since such date. This Presentation is subject to Norwegian law and the exclusive jurisdiction of the Norwegian courts. 2

3 Table of contents Corporate overview Current producing assets Development potential Exploration success Extensive ongoing explo. programme Summary

4 Introduction Bridge Energy ASA ( Bridge ) is a Norwegian and UK listed full cycle oil & gas company Exploration & Production company holding production assets in the UKCS and exploration assets in both NCS and UKCS 4 producing assets, which currently contribute c.1,200 boepd Victoria field has been on production since 2008 Duart interest (acquired December 2011) Boa interest (acquired October 2012) Cormorant East interest commenced production January 2013 Production projected to exceed 10,000 boepd within 5 years from existing portfolio Bridge has 37 licences (8 as operator) and has drilled 17 E&A wells, including 10 discoveries High impact exploration portfolio underpinned by existing production, along with a strong inventory of undeveloped discoveries 4

5 Bridge a self-sustaining E&P business Listed Oslo 21 May 2010 (OSE: BRIDGE) Listed London AIM 27 September 2012 (AIM: BRDG.L) Analyst Coverage Analyst Pareto Thomas Aarrestad First Securities Teodor Sveen Nilsen ABG Sundal Collier Anders Holte Carnegie ASA Martin Vold Sparebank Markets Kristoffer Dahlberg Fondsfinans ASA Morten Lindbaek Cenkos Securities Ashley Kelty Edison Research Ian McClelland Share structure 4,8% 1,0% 7,6% 25.1% 28.2% 33.9% Float AIMCo Lime Rock Storebrand KLP Mgt Share Price *12,15NOK (135p) Shares in issue 63,429,169 Consensus TP Market cap 21 NOK 771 MNOK ( 88m) *18 th March

6 Five clear routes to delivering growth Growth through acquisition Significant UK tax loss position shelters cash flow from production Supports higher level of debt funding to fund acquisition Resulting leverage supports strong return on invested equity Broaden exploration portfolio Targeting 3-4 exploration wells drilled per year Significant inventory of targets in both the NCS and UKCS Progress development options within existing portfolio of assets Significant upside potential within Duart & Boa assets, with ability to deliver production increase at reasonable cost in the short term Material value within Vulcan satellites, can be unlocked through introduction of partner Grow liquidity and access to capital Enhanced through listing on AIM and transfer to Oslo Børs Debt facilities with accordion capability to support growth Resource the business Strong management team with track record of delivery 6

7 2012- a transformational year Production 2P reserves increase by 22% & value increase to NPV10 68mm Acquisition of Boa Interest Oct 2012 RRR 221% Exploration 4 wells drilled with 3 discoveries 23mmboe of 2C resource added through drill-bit 37mmboe 2C in total Additional targets de-risked & further licence awards in 2012 Development upside Asha pre-unitisation agreement Good progress made on Duart and Boa Maturing development concepts within Vulcan area Liquidity & access to capital AIM listing Sep 2012 Transfer to Oslo Bors Oct 2012 Strong underlying institutional support 7

8 Table of contents Corporate Overview Current producing assets Development potential Exploration success Extensive ongoing explo. programme Summary

9 Overview of UK producing assets Victoria gas field operated 75% interest First gas in October P reserves of 2.1 mmboe Cormorant East Boa Duart 50% interest (Talisman operator) First oil in 2007 Net 2p reserves of 0.75 mmbbl Duart Boa 1.55% interest (Marathon operator) First oil in 2008 Net 2p reserves of 0.42 mmbbl Cormorant East- 4% interest (TAQA operator) First oil January 2013 Currently in depletion phase Good upside potential Victoria Note: Reserve and contingent resources are based on reserve report 31 st December

10 Victoria steady production Forecast monthly production boepd* jan-13 apr-13 jul-13 okt-13 jan-14 apr-14 jul-14 okt-14 Asset summary** 2P Reserves mmboe Field Interest - 75% (Operator) NPV10# - 26mm # Assumes reference Brent price of USD$110/bbl and NBP gas 60p/therm ** From Reserve Report dated 31 st December

11 Duart field low maintenance, high margin barrels Forecast monthly production boepd* jan-13 apr-13 jul-13 okt-13 jan-14 apr-14 jul-14 okt-14 Asset summary** 2P Reserves mmbbl Field Interest 50% (Talisman Operator) NPV10# mm # Assumes reference Brent price of USD$110/bbl and NBP gas 60p/therm ** From Reserves Report dated 31 December

12 Boa low maintenance, high margin barrels 250 Forecast monthly production boepd* jan-13 apr-13 jul-13 okt-13 jan-14 apr-14 jul-14 okt-14 Asset summary** 2P Reserves mmbbl Field Interest 1.55% (Marathon Operator) NPV10# mm # Assumes reference Brent price of USD$110/bbl and NBP gas 60p/therm ** From Reserve Report dated 31 st December

13 Mature life asset acquisition Price Stock Net Price LOF Cash Net Cash Consistent same investment criteria low opex high margin low decommissioning costs Leverage balance sheet- tax loss pool provides value driver Tax loss pool also optimises cash flow (lowers net opex) to fund portfolio growth Funded through current cash and an expansion of existing RBL facility Combination of tax shelter and strong debt capacity provides very attractive return Further upside potential not just base cash flow 13

14 Table of contents Corporate Overview Current producing assets Development potential Exploration success Extensive ongoing explo. programme Summary

15 Duart area - further development and prospectivity Duart South viable development 2C 2.23mmbbl (gross) Investment $50M (gross) Value $100M (gross) Duart East very significant prospect Scapa sand target STOIIP mmbbls (gross) Value c. $200M (gross) Development options being reviewed, with study work scheduled to be completed Q Drilling anticipated 2014 Note: Reserve and contingent resources are based on Reserve Report 31 st December 2012 Both prospects offer near-term potential 15

16 Boa: Infill targets are well defined... 16

17 Vulcan hub 48/20b-6 Vulcan NNW RWE Discovered BCF GIIP Recent 26 th Rd Award 48/25a Vulcan NW Bridge Energy 100%, Operator BCF GIIP - 2C 131 BCF (22 mmboe) Appraised (3 rd well) 2008 Horizontal multi-frac development 48/19c Clipper South RWE 180 BCF recoverable Horizontal multi-frac development Phase 1 currently on-line 49/21-8a Vulcan South Bridge Energy 66.6%, Operator BCF GIIP - 2C 112 BCF (19 mmboe gross) - 2C 75 BCF (12.3 mmboe net) Discovered by 49/21-8, /21-10a Vulcan East Bridge Energy 100%, Operator BCF GIIP - 2P 73 BCF (12.1 mmboe) Discovered by 49/21-10a, 2007 Horizontal multi-frac development 17

18 GBP million Vulcan hub economics Key valuation metrics* Gross probable resource: 525 BSCF GIIP 319 BSCF Recoverable 1000 Gas price: 50p/th 500 Gross revenues: 1,800mm 0 Revenue Dev. Ex LOF Opex Abex Net Cash Before Tax Tax Net Cash After Tax Net Cash before tax: 1,000mm -500 NPV10 (before tax): 500mm NPV10 (after tax) 250mm *The above forecasts are based on certain management estimates and assumptions believed to be reasonable at the date of this presentation. 18

19 Table of contents Corporate Overview Current producing assets Development potential Exploration success Extensive ongoing explo. programme Summary

20 2012 exploration success PL554 Garantiana, Oil discovery discovery 20% share Net resources added: 8.6mmboe* Net cost: USD 4.5 million N - North Sea PL457 Asha, Oil discovery 20% share Net resources added: 13.4mmboe* Net cost: USD 3.5 million (prelim.) P1915 Vulcan South, licence award 66% share Net resources added: 12.3 mmboe* Cormorant East- Oil discovery 4% share Net 2C resource added: 1.3mmboe* Nominal exploration cost *Reserve and contingent resources are based on reserve report dated 31 st December

21 Cormorant East Field Well spud 24th August Oil discovery announced 22nd October Well put on production early January 2013 and was developed under the field name Cormorant East, 85 days after discovery. Cormorant East Net 2C resource of 1.3mmboe added in 2012 Ongoing work to further define the size of the field and further development options N Cormorant Bridge has 4% interest 21

22 PL554 discovery de-risks area potential (Bridge 20% Interest) Garantiana North mmboe POS (%) Brent % Cook % Statfjord % Lunde % Garantiana North Garantiana* Brent % Cook 8.6 discovery Statfjord % Lunde % Updip Angulata Garantiana Updip Brent % Cook % Statfjord % Lunde % Angulata Brent % Cook % Statfjord % Lunde % Unrisked net resources (post-drill) *Garantiana discovery now classified as a 2C Contingent Resource within the most recent reserve report Note: Reserve and contingent and prospective resources are based on reserve report 31st December

23 PL457 area Asha discovery and prospects (Bridge 20% Interest) Mukta 2 Aglaja* Ivar Aasen Aglaja Asha Amol (Preliminary) pre-drill values, unrisked million boe net to Bridge Tellus (E. Grieg) 6 Amol* Southern Utsira High area Asha discovery: mmboe (gross within PL457) Note: Reserve and contingent and prospective resources are based on reserve report 31st December

24 Ivar Aasen milestones 2012 PDO submitted 2013 Contract awards 2014 Construction 2015 Well drilling Install jacket 2016 Install topside First oil First oil Southern Utsira High area 24

25 Bridge Asha interest valuable property Option remains to invest and participate in the development Material development with production expected within 36 months Opportunities exist to monetise the asset Options to swap for production assets - increasing cash flow Ability to sell for cash and efficiently re-invest capital in other projects Once unitisation agreed and PDO approved Asha will support incremental debt capacity Indicative valuation of Asha Bridge reserve report confirms 13 mmboe contingent resource (net) Market benchmarks indicate value range of USD$5-$8 per boe RWE sold Edvard Grieg interest in 2012 for estimated $8.5/bbl Indicative value for Bridge Asha interest $ million 25

26 Table of contents Corporate Overview Current producing assets Development potential Exploration success Extensive ongoing explo. programme Summary

27 Extensive explo. drilling programme Note well timings are subject to change due to changes in operator programmes 27

28 2013: PL511 Mjøsa Mjøsa Linnorm Noatun Njord Drilling expected to commence Q Bridge has a 7.5% interest Bridge benefits from significant cost carry Net unrisked potential 14 mmboe POS 14% From Reserves Report dated 31 December

29 2014: PL494 Hercules Spud likely 2014 Bridge has a 30% interest Net unrisked potential 94 mmboe POS 20% From Reserves Report dated 31 December

30 2013/4: P1763 Aragon S N Bridge has a 13.5% interest Target prospect at Heather level Net unrisked potential 9 mmboe POS 21% From Reserves Report December

31 2013: P2082 Skerryvore Seismic amplitude Tor level Bridge has a 25% interest Dual target prospect at Mey and Tor level Net unrisked potential 16.5 mmboe POS 32% From Reserves Report 31 December

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33 Table of contents Corporate Overview Current producing assets Development potential Exploration success Extensive ongoing explo. programme Summary

34 Summary High impact 2012 exploration programme, yielding 3 commercial discoveries from 4 wells drilled 37 mmboe of Contingent Resources added in /3 exploration wells planned H2 2013, with c. 53 mmboe of prospective risked resources being tested over the next 24-months Significant development potential within existing asset base and ability to bring further production on-stream in the near-term Continue to pursue potential acquisition opportunities to leverage tax pool Core activity funded from existing cash flow 34