Investors Presentation Reg Nelson Managing Director Hector Gordon Chief Operating Officer

Transcription

1 Beach Petroleum Limited Investors Presentation Reg Nelson Managing Director Hector Gordon Chief Operating Officer March 2007

2 Today s Topics Overview of Current Status Financial results - 1H FY 07 Operations Review Outlook 2

3 Australia s Premium Mid-Cap E&P At over A$1 billion market cap and over 100 mmboe 2P reserves, Beach is Australia s premium mid-cap E&P company AUD$mm Australian Oil & Gas Mid Cap Companies by Mrk Cap* BPT AWE ROC AED AOE QGC AZA NXS ARQ HZN NDO TAP mmboe Australian Oil & Gas Mid Cap Reserves BPT AWE ROC AZA AED TAP ARQ NDO * February

4 Company Attributes High quality, balanced portfolio of assets with solid reserves base Strong, long term cash flow potential Reserves:Production ratio of ~ 10 years Proven value manager of assets Diversified portfolio geographic & commodities: Oil, gas, gas liquids, geothermal Offshore & onshore Solid growth profile and expansion strategy: 232% organic three-year reserve replacement ratio 4

5 Shareholder Return Shareholder Return Total Shareholder Return 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 86.00% 64.00% 50.00% 35.00% 1yr 2yr 3yr 4yr 5

6 Corporate Structure Issued Shares & Options million ordinary shares 8.1 million employee options EX$1.406 (to 30 Nov 2013) Market Capitalisation $1.20/share) $1.07 billion 0.24% 10.57% Jan 2007 Top 62.32% of shareholders 0.69% 1.39% 0.47% Institutional Corporates/Non-profit Private Related Parties Brokers Custodians & Nominees Admitted to ASX 200 in September % Values are % of total shareholders 6

7 Key Revenue-earning Projects Cooper Basin: Oil, gas and liquids over 200 fields Long-term gas contracts Oil production forecast to increase through Cooper Oil Project Moomba hub connects to eastern seaboard pipeline system Liquids pipeline to Port Bonython MT ISA 500 KM Basker-Manta-Gummy (BMG) Project: Oil production commenced Dec 2006 Development planned for gas and condensate resource BALLERA MOOMBA JACKSON ~300 PJ 11 mmb GLADSTONE 70 PJ BRISBANE Tipton West Project: Large coal seam gas resource Phase 1 production commenced Jan 2007 ADELAIDE TAMWORTH LITHGOW SYDNEY MELBOURNE 190 PJ / 9 mmb 20 mmb 7

8 Beach Petroleum Limited 1H - Financial Year 07 March 2007

9 Reserves June 2006 Area Proved and Probable Reserves Oil (mmb) Gas Liquids (mmboe) Sales Gas (PJ) Oil Equivalent (mmboe) 500 KM Cooper MT ISA GLADSTONE Gippsland Surat BALLERA MOOMBA JACKSON ~300 PJ 11 mmb TAMWORTH 70 PJ BRISBANE TOTAL ADELAIDE LITHGOW SYDNEY MELBOURNE 20 mmb 190 PJ / 9 mmb 9

10 Production 1H FY 07 Area Oil (mmb) Net Production 1H FY07 Gas Liquids (mmboe) Sales Gas (PJ) Oil Equivalent (mmboe) 500 KM MT ISA Cooper- Beach GLADSTONE Cooper- Delhi Gippsland BALLERA MOOMBA JACKSON ~300 PJ 11 mmb TAMWORTH 70 PJ BRISBANE LITHGOW TOTAL ADELAIDE SYDNEY MELBOURNE 20 mmb 190 PJ / 9 mmb 10

11 Sales & Revenue 1H FY 07 Production Sales Revenue Oil 0.9 mmb 0.8 mmb $66 million Gas / Gas Liquids 3.8 mmboe 3.9 mmboe $121 million 3 rd Party Oil & Gas mmboe $28 million TOTAL 4.7 mmboe 5.4 mmboe $214 million 11

12 Strong Operating Profit Beach ($ million) Delhi ($ million) Total ($ million) Gross Revenue (ex 3 rd party) Production Costs Dep n & Amort Operating Profit Other Income/Expenses (2) Hedging (5) 0 (5) Transaction Costs (12) (25) (37) Profit Before Tax (2) Tax 1 (13) (12) Profit After Tax (1) Strong operating profit NPAT affected by Delhi acquisition costs (mostly one-off) required to be accounted for under AIFRS 12

13 Operations Review 13

14 Basker-Manta-Gummy Beach 50% Oil Reserves (gross) 1P: 13 mmb 2P: 39 mmb 3P: 77 mmb Contingent Resource (gross) Low 120 PJ & 4 mmb ~ 24 mmboe Best 380 PJ & 19 mmb ~ 80 mmboe High 820 PJ & 17 mmb ~ 150 mmboe 14

15 Basker-Manta-Gummy Beach 50% Current Status Production Commenced 17 December. Higher than expected GOR (~2,000 actual vs 1,200 expected). Jan-Feb Production averaged ~10,000 bopd but building. Operational issues, primarily with compression facilities being addressed. 15

16 Basker-Manta-Gummy Beach 50% Status at 1 March Producing from Manta-2A, Basker 2, 3 & 5. Average rate in last week of Feb was 13,000 bopd. Gas being injected into Basker-4 (~32 mmcfd) Medium term target 15-20,000 bopd Annual OPEX ~$75 million ($37.5 net from Beach) Beach has RRT Credits of ~$280 million important when assessing future CAPEX self funding 16

17 Basker-Manta-Gummy Beach 50% Development Plans Oil Up to 3 further Basker Wells addressing ~15mmb of undeveloped 2P reserves Cost up to $300 million Drilling.. Basker-6 Late 2007 (remainder mid 2008) Online early 2008 Gas development program will help maximise oil production All numbers are for 100% of project 17

18 Basker-Manta-Gummy Beach 50% Development Plans Gas Gas Sales Agreement with Alinta for Tasmanian power generation 225 PJ over 15 years will underwrite gas development capex Aiming for Project sanction 2 nd Quarter 07 - startup 2009 Drill up to 3 wells in Manta & Gummy Fields in 2008 Gas Pipeline to Shore Gas Processing Facility (prob offshore) Cost ~$500 million Possible new (leased) FPSO in order to reduce OPEX *All numbers are for 100% of project 18

19 Cooper-Eromanga Basins Bodalla Block Beach 100% Christies/Sellicks Beach 75% CB JVs Beach ~21% Naccowlah Block Beach 38.5% Oil to Brisbane 19

20 Cooper-Eromanga Basin: Highlights Highlights -- 1H FY07 13 Exploration Wells drilled (38% Success Rate) Yanda/Wackett 10 wells Callawonga Oil Discovery Online in 1,000 bopd (net) Reserves ~1 mmb (net) Callawonga Cooper Oil Project Success (11 wells, 100% success) JALBU - 1 well 20

21 Cooper-Eromanga Basin: Strong Profitability High Netback Oil Production 0.9 mmb produced in 1H FY 07 (approx. 50% from Beach-operated and 50% from Santos-operated) A$/bbl Oil Price Production Costs Royalties Netback Note: approx 40% of current Cooper oil production & 10% of the Cooper oil reserve base (or 1% of Beach s total reserves base) is subject to Delhi s inherited oil price hedges. These percentages are expected to diminish even more significantly as fresh production comes on stream. 21

22 Cooper Oil Program (COP) Development & Appraisal Program operated by STO in existing oil fields Beach Equity ~25% (but 38.5% of Naccowlah Block) ~700 mmb OOIP in Cooper Basin Recovery from existing wells ~200 mmb (28%) Aim to increase recovery factor by 5-10% >> additional mmb Low risk/high success rate Netback per barrel of AUD21 to 28 per barrel for oil prices in range AUD 75 to 85 per barrel (after allowing for finding & developing costs, opex and all royalties) 22

23 COP NETBACK SENSITIVITY ANALYSIS COP economics are robust with prevailing oil prices Netback AUD/bbl AUD/bbl Oil Price Finding & Development Production Costs Royalties Netback (*USD46.80) (*USD58.50) (*USD70.20) Netback (AUD/bbl) Oil Price AUD/bbl Netback/bbl * Assumes USD:AUD of

24 Cooper-Eromanga Basin Cooper Oil Project Naccowlah Block-(Beach 38.5%) 24 wells 13 Exploration 7 Appraisal 4 Development Programme commenced March 2007 Cost $21 million (net) Expected Reserves ~1 mmb (net) Expected Initial Production 1,000 BOPD (net) Expected Value $15-25 million (net) Cooper Basin J.V. (ex Naccowlah) ~100 Wells in Beach tenements in 2007 Expected net reserves 2-5 mmb Expected initial production net to Beach of 3500 BOPD (1.25 million bbls per year) 24

25 Tipton West Coal Seam Gas Beach 40% Proved & Probable (2P) reserves: 174 PJ Proved, Probable & Possible (3P) Reserves: 2,300 PJ Close to markets & pipelines High Exploration Potential 25

26 Tipton West Coal Seam Gas Beach 40% Phase 1 Development 82 wells Development Drilling Completed Gas Sales Commenced in February Target Rate 30 TJ/day Exploration Potential Taroom Coal Measures Dalby South Block Corehole Program 26

27 High Reward Exploration Carnarvon (BPT 10%) Hurricane-2, Q2 07 Target mmbbl oil potential Offshore Otway Basin (BPT 50%) 3D Seismic Q1 07 Target >1 TCF gas potential Drill FY 07 Hurricane-2 Production Testing Glenaire-1 (Onshore Otway) Champagne Creek (Surat) Offshore New Zealand Barque-1 3D Seismic Barque-1 27

28 Offshore Carnarvon Basin - Oil Hurricane-2 Hurricane-1 Beach 10% Up to 40mmb recoverable below gas cap? Hurricane-2 (proposed) Hurricane-1 Extent of Proven Gas (~ 30 bcf) 28

29 Offshore Otway Basin - Gas Beach 50% Target size: approx. 1 TCF gas Casino Gas Field Approx. same scale Fermat Prospect 29

30 Offshore NZ: Large Gas Liquids Potential Lightly explored Sub-commercial gas/condensate discovery (Galleon-1) Significant upside potential Barque Prospect potential for 6 TCF of gas million barrels of condensate Barque 30

31 Geothermal Exploration 31

32 Beach Petroleum Limited Outlook March 2007

33 Production Cooper Oil Program expected to build oil production significantly from Beach-operated Cooper oil expected to continue to produce at ~ 1mmbbl p.a. or better over the next 3-5 years - with good likelihood of continued reserves replacement BMG oil production ~15,000-20,000 bopd (gross) pending oil develoipment program in late 2007 Cooper gas expected to continue to decline over the next decade, but tight gas resources offer longer term potential Substantial coal seam gas potential beside pipelines at Tipton West for future contracts BMG gas development plan ~

34 Exploration Good medium to long term potential for low risk exploration in Cooper region Potential discoveries at Glenaire (onshore Otway) and Champagne Creek (Surat) Offshore Carnarvon Hurricane play could have significant follow-up potential Large gas prospects offshore from Portland, Victoria Large gas-condensate plays offshore South Island, NZ New geothermal potential Experienced professionals dedicated to searching for and evaluating new opportunities both in Australia and internationally 34

35 Value per boe Beach trades in the bottom third of its peers on $/boe Value per BOE AUD$/boe AED ROC ARQ NDO AZA AWE BPT TAP AOE QGC 35

36 Significant upside potential Beach has upside exposure to c.65mmboe of additional reserves in existing projects/developments 36

37 Significant Coal Seam Gas Potential Post shelving of PNG gas project, there is strong focus on companies with coal seam gas (CSG) assets Focus has been mainly on pure CSG companies (QGC, Arrow, etc) Beach s 40% interest in Tipton West and surrounding licences has yet to receive full recognition? 37

38 What Sets Beach Apart? Reserves Base At top of mid caps Stable mix of oil, gas & liquids Geographic spread offshore & onshore Long life production potential (10 years reserves:production ratio) Attitude Commitment to reward shareholders (consistent record of TSR) Commercially astute management aggressive expansion strategy Long term view of emerging trends and opportunities Good, stable professional workforce Funded All projects fully funded from robust operational cash flow Highly active Strong exploration & development program Potential for high impact discoveries 38

39 Important Notice & Disclaimer Beach Petroleum has prepared this presentation based on information available to it. No express or implied representation or warranty is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this presentation. To the maximum extent permitted by law, neither Beach Petroleum or its related or affiliated companies (together the Beach Group ) nor their respective directors, employees, agents or advisers (together the Officers ), accepts any liability (including, without limitation, any liability arising from fault or negligence) on the part of any of them or on the part of any other person (whether referred to in this presentation or not), for any direct or indirect loss or damage arising from the use of, or reliance on, this presentation or any discussion or commentary in respect of it, by the Beach Group or any of the Officers (together the Presentation ). The Presentation is not an advertisement, inducement, offer, invitation, solicitation or other recommendation to subscribe for or purchase any securities of any member of the Beach Group. The Presentation will not form the basis of any contract or commitment to subscribe for or purchase any securities of any member of the Beach Group. Any offer or invitation to subscribe for or purchase any announced or pending security issue by any member of the Beach Group which requires the issue of a disclosure document under the Corporations Act 2001, will only be made under and in accordance with the terms set out in the disclosure document issued at the time the offer or invitation is formally made. Anyone who is entitled to, and wishes to, subscribe for or purchase such securities will need to complete the application form for the securities that will be in or will accompany the disclosure document. The Presentation may contain forward looking statements that are subject to risk factors associated with oil and gas businesses. While it is believed that the expectations reflected in these statements are reasonable, there can be no guarantee that actual results and trends will be in accordance with the forward looking statements. Actual results or trends may be affected by a variety of variables as well as changes in underlying assumptions which could cause actual results or trends to differ materially for those in the Presentation. The variables include, but are not limited to, resource and commodity price fluctuations, actual demand fluctuations, currency and interest rate fluctuations, drilling and production results and their impact on reserve estimations, loss of markets, industry competition, environmental risks, physical risks, legislative and any related fiscal and regulatory changes, economic and financial market conditions in various countries and regions, political risks, project delay or advancement, ability to obtain or delays in obtaining approvals from regulatory authorities and other third parties, and changes in cost estimates as a result of changes in other variable factors. This list is not exhaustive. All references to dollars, cents or $ in this presentation are to Australian currency unless otherwise stated. The distribution of this presentation outside Australia may be restricted by law and it is the responsibility of the recipient to observe any and all such restrictions. NOT FOR DISTRIBUTION TO THE UNITED STATES WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES 39