Beach Petroleum Limited. Financial Results August 2007

Transcription

1 Beach Petroleum Limited Financial Results August 2007

2 1 Corporate Overview 2 Key Revenue Earning Projects 3 Strategy for Growth 4 Outlook

3 Large & Growing Energy Company Beach Petroleum during FY07: A top Australian energy company ASX200 Market capitalisation of over $1 billion Major investment in Cooper Basin & infrastructure supplies over 20% of Cooper Basin gas to east coast markets Bass Strait Joint Venture moving to supply a substantial component of Victoria s s oil production A pioneer contributor to developing geothermal energy

4 LPG Gas Liquids Gas Processing Coal Seam Gas Natural Gas Pipelines & Export Facilities Crude Oil Beach A Diversified Energy Provider Developing Geothermal Power

5 Large Infrastructure Holdings CO2 Geosequestration: Large Scale Potential Moomba Plant Gas & Liquids Processing Distribution Ballera Gas Processing & Distribution Port Bonython Liquids Pipeline Processing & Export Jackson-Moonie Crude Oil Pipeline BMG Oil FPSO & Shuttle Tanker Coal Seam Gas For Electricity Generation

6 Historical Growth: Increased Production Gross Revenue $ million p.a. Concept 0 FY02 FY03 FY04 FY05 FY Production mmboe p.a EBIT $ million p.a. Concept FY02 FY03 FY04 Y05 FY06 FY02 FY04 FY NPAT $ million p.a. FY02 FY03 FY04 FY05 FY06

7 Key Financial Results months to June 2007 CASH FLOW & FINANCIAL STRENGTH 12 months to June 2006 Increase over PCP Half Year to December 2006 Half Year to December 2005 Increase over PCP Oil Sales $' , , % 214,400 44, % Other Income $'001 94,616 36, % 32,557 26,276 24% Profit before Tax $' ,625 59, % 32,261 41,171-22% EBIT $' ,139 57, % 9,344 39,936-77% NPAT $' ,252 43, % 20,344 31,267-35% Basic EPS cps % % Dividends cps % % Cash Flows Net Cash from Ops $' ,955 63,340 77% 29,927 18,193 64% Investing Cash Flow $'000 (359,454) (193,360) 86% (237,422) (55,581) 327% Property & Plant $' , , % 977, , % Cash on Hand $'000 74,720 25, % 35,741 72,215-51% Balance Sheet Net Assets $' , , % 748, , % Debt $' ,266 1, % 238,633 1, % Debt/Debt+Equity 26.4% 0.4% 6592% 24.2% 0.5% 5082%

8 Key Financial Results Revenue Oil and gas sales up 275% to 472.2million Gain on sale of BMG - $71million Net gain on currency hedges - $11.5million GROSS REVENUE $566.8M 248% 400 $M FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07

9 Key Financial Results EBIT Total interest and borrowing costs expensed $50.93million. EBIT $189.14M 229% $M FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07

10 Key Financial Results Net profit after tax 135% increase in net profit after tax from $44million to $103.25million. NET PROFIT AFTER TAX $103.25M 135% $M FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07

11 Key Financial Results Net Profit before tax normalised PROFIT $91.049M 133% $M Profit Sale of BMG Hedging Sale of Anzon Delhi Interest & Acquisition Significant Items Underlying Profit

12 Production Surge ANNUAL PRODUCTION MMBOE 589% MMBOE FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07

13 Main Strengths Revenue Revenue from from 3 3 key key producing producing assets assets High High quality quality Australian Australian eastern eastern coast coast portfolio portfolio Strong, Strong, proven proven value value adding adding management management Reserves Reserves to to production production life life of of years years Stable Stable professional professional workforce workforce Potential Potential for for oil oil production production increases increases through through COP COP Well Well placed placed to to expand expand by by exploration exploration & acquisitions acquisitions Strong Strong Qld Qld Coal Coal Seam Seam Gas Gas position position

14 Diversified Reserves Distribution GLADSTONE 500 KM 62% 7% 31% Proved & Probable Reserves at 1 July 2006 Oil Liquids Gas Proved and Probable Reserves of 90 million boe MOOMBA JACKSON BALLERA BRISBANE TAMWORTH LITHGOW SYDNEY ADELAIDE MELBOURNE Large 3P Coal Seam Gas potential Contingent gas-liquids resource Contingent or possible reserves are a further 170+ million boe

15 Peer Comparison (2P Reserves) PEER COMPARISON Proved & Probable Reserves (mmboe) BPT OSH AWE ROC AZA HDR AED IPM TAP AMU ARQ

16 Reserves & Upside Potential P reserves (mmboe) Reserves potential upside BMG Gas/Condensate Cooper Oil Program FY08 Tipton West CSG Present 2P Beach has upside exposure over 3 to 5 years to over 62 mmboe of additional reserves in existing projects/developments With production at 10 mmboe p.a., Beach s 2P reserves base can still grow by 10-25% over 3-5 years (excluding any new acquisitions or discoveries)

17 Beach Petroleum Limited Key Projects: Cooper Oil, Gas & Gas Liquids Queensland Coal Seam Gas BMG (offshore Gippsland) ) Oil & Gas

18 Cooper-Eromanga Basin Kenmore & Bodalla South the precursor to the Cooper Oil Program Bodalla Block Beach 100% Christies/Sellicks Beach 75% Cooper Basin Joint Ventures Beach ~21% Naccowlah Block Beach 38.5% Oil to Brisban e

19 Cooper Basin Revenue Drivers Gas and Gas Liquids Beach Operated Oil Cooper Oil Program (COP) Long term gas contracts Production of ~1 mmbbl p.a. Significant new program Strong & Stable revenues: Robust economics Delhi reserves acquired for $8.65/boe Potential for substantial lift in reserves & production

20 Highly Profitable Cooper Oil High Netback Oil Production Production for the first half year of FY07 was 1.63 mmbbl (approx. 60% Beach-operated) Average free cash of AUD53.73/bbl at oil price of AUD86.45/bbl Chart shows netback per barrel sensitivity for various oil prices Average realised price for FY07 was AUD 86.45/bbl

21 Cooper Basin FY07 Highlights Callawonga Oil Field Discovered July 06 Reserves ~1 mmb (net to Beach) 3D seismic suggests significant additional reserves potential Appraisal drilling Sept 07 Bodalla South Field extension Two new wells drilled on 3D seismic Northern portion of field opened up for further drilling Marcoola Oil Field Discovered June 07 Beach operated Santos operated Cooper Oil Program (COP) 38 wells with BPT participation to July 07 ~76% cased for production

22 Cooper Oil Project (COP) Intensive exploration, appraisal & development Building high value reserves additions Near & within existing oilfields Average Beach equity ~ 25% Targeting up to 15 mmbbl net to Beach over 3-5 years Potential to add NPV of up to $350+ million* * At present oil prices But Beach has 38.5% of prime Naccowlah Block

23 COP Program for Naccowlah Block (BPT ~38.5%) Other SA & Qld (BPT ~20%) 41 wells 105 wells 155 wells BPT ~24% Potential to add 3-5 mmb >3000 bopd

24 Queensland Coal Seam Gas Tipton West & adjacent - Beach 40% Proved & Probable (2P) reserves: 174 PJ Possible (3P) resource of 2300 PJ plus further potential in adjacent tenements Close to markets & pipelines abutting main trunk line to Brisbane 174 High Exploration Potential P Developed & Contracted 3P Potential

25 Tipton West Coal Seam Gas Phase 1 Development 82 wells Development Drilling Completed Gas Sales Commenced in February Target Rate 30 TJ/day Firm commitment recently upgraded to 10 PJ/yr for 15 years, with a further 7.3 PJ/yr put option Exploration Potential Taroom Coal Measures Dalby South Block Corehole Program

26 Tipton West Coal Seam Gas Important expansion development over FY08 Three pilot projects planned Objective to increase reserves by more than 200 PJ (~14 mmboe net to Beach) 8% 9% Undeveloped/ uncontracted 83% 2P Developed & Contracted Planned '08 expansion 3P Resource

27 Basker-Manta-Gummy (BPT 40%) Significant increase in reserve estimates following development drilling: Oil 2P reserves nearly double original estimate Gas-condensate resource nearly quadrupled Sold a 10% interest (June 07) to Itochu Corporation of Japan for $123 million cash Transaction gives BMG a project valuation in excess of $1.2 billion ion

28 BMG Reserve/Resource Estimates Oil Reserves Gas Resource Condensate Resource P90/P50/P10 estimates* Total Reserves/Resources Million barrels of oil equivalent * For 100% of project, based on latest certification by Gaffney Cline and Associates (August 2006)

29 BMG: Increase in Reserves 2006 Development Drilling increased size of Basker Field. Increases to Oil Reserves & Gas Resource. Wells drilled to date tend to be nearer the crest of the field than intended. More drilling required Oil-water contact inferred prior to to drilling of of Basker wells 3 to to 5

30 BMG: Current Status Production Commenced December Higher than expected Gas-to- Oil ratio probably due to wells located higher on what now seems to be a much larger structure. Cumulative Production (100%) to end June 07 to end June 07 ~2.5 mmb (including EPT) Cumulative Revenue (100%) ; ~$200 million (sales 2.15 mmb) Mooring incident temporary disruption has affected production from July Sept 07 (est.)

31 BMG: Further Oil Development Up to 3 further Basker Wells addressing ~15mmb of undeveloped 2P reserves Drilling.. Basker-6 in late 2007 (remainder mid 2008) Basker-6 expected to be online early 2008 Export and sales of gas will ultimately help maximise oil production All numbers are for 100% of project

32 Beach Petroleum Limited High Impact Exploration Projects

33 High Reward Exploration Offshore Bass Basin (BPT 50-80%) Spikey Beach-1 and Peejay-1 scheduled for 2008 Offshore Taranaki Basin (BPT 20%) Kopuwai-1 scheduled for 2007 Offshore Otway Basin (BPT 50%) Fermat-1 scheduled for 2008 Production Testing (BPT 40-50%) Champagne Creek (Surat) Glenaire-1 (Onshore Otway) Offshore New Zealand (BPT 20%) Barque-1 scheduled for 2008 More to come

34 Presently scheduled high impact drilling Project Area Targets BPT % Comments Timing Offshore Bass Spikey Beach-1 80% Target 33 mmb oil Second quarter 2008 Offshore Bass Peejay-1 50% Target 57 mmb oil Second quarter 2008 Offshore Taranaki Kopuwai-1 20% Target 155 mmb oil Fourth quarter 2007 Offshore Otway Fermat-1 50% Target 1200 PJ gas Second quarter 2008 Offshore New Zealand Barque-1 20% Highside 6000 PJ gas & 600 mmbl condensate Second/third quarter 2008 Geothermal SA Paralana Project 21 36% Anticipated demand for base load renewable power First quarter 2008

35 Bass Basin - Oil Similar hydrocarbon system to Gippsland Basin (BMG Project). Proven Hydrocarbon System. Location near basin edge oil prone. 50 km offshore. Pipeline to shore or FPSO development concept. Possible (P10) reserves of 33 mmb Possible (P10) reserves of 57 mmb

36 Bass Basin T/38P Spikey Beach Prospect Area = 12km2 Relief = 30m Depth to target = 1450m. (Eastern View Coal Measures) Potential P10 reserves = 33mmb Prospect Risk = 27% Drill with Jack-up. TD = 2000m

37 Bass Basin T/39P Area = 24km 2 Relief = 70m Peejay Prospect Depth to target = 13400m. (Eastern View Coal Measures) Potential P10 reserves = 57mmb Prospect Risk = 20% Drill with Jack-up. TD = 2600m 1390 mss

38 Taranaki Basin (NZ) PEP Kopuwai Possible (P10) recoverable 155 mmb Location 60km offshore 137m water depth Southern Taranaki Basin proven source kitchen Similar hydrocarbon system to Gippsland. AWE oil development ~30mmb OMV oil development ~50mmb Maui has produced 3Tcf

39 PEP Kopuwai Prospect Area = 44km 2 Relief = 70m Kopuwai Prospect Pr. Kopuwai-1 Depth to target = 3830m. Location near Tui oil prone. TD = 4200m to intersect Basement. Potential P10 reserves = 155 mmb. Prospect Risk = 16% Drill with Semi-sub. Water Depth = 137m FPSO development concept stand alone or Tui tie-back.

40 Offshore Otway Basin Gas VIC/P46 Beach 50% Target size: approx PJ gas Fermat Prospect

41 Large Gas Liquids Potential NZ Beach 20% Lightly explored Working petroleum system /good reservoir sands demonstrated by sub- commercial gas/condensate discovery (Galleon-1) and good shows in Cutter-1 Barque Significant potential for large gas/condensate resources Barque Prospect highside potential for 6 TCF of gas million barrels of condensate

42 Beach Petroleum Limited Growth Opportunities & Outlook

43 Strategies Build gas portfolio around eastern seaboard pipeline network Realise value for Coal Seam Gas assets with ~800 PJ Possible Reserves (pure CSG companies are reflecting on average $0.54 per GJ applied to BPT would imply additional ~$400 million potential value) Entry into projects with LNG potential at ground floor LNG Potential LNG Potential Geothermal project assessment both for long term revenue potential and for carbon credits (pure geothermal companies are reflecting high values in current market) Greater exposure to high reward exploration Australia and international Build gas portfolio around eastern seaboard pipeline network LNG Potential

44 Domestic Gas Prices Are Low US (Henry Hub)* $8.00 $10.00 Australia West Coast export India* $7.00 $9.00 $6.50 $9.00 China* $3.50 $5.25 Vietnam* $4.00 $4.75 Indicative Gas Prices Indonesia* Australia East Coast pricing $3.25 $4.75 $2.50 $ * At USD:AUD of $0.85 Source: AFR 19 July 2007

45 Australian Gas Markets Increasing interest by downstream users in equity gas due to price risk going forward Significant uncontracted supply to meet forecast demand Queensland and northern NSW CSG is viewed as a replacement for PNG or other northern gas Actual production growth (especially for CSG) over the next 2 3 years will be critical in satisfying long term supply/demand balance Annual Demand/Supply (PJ per annum) Contracted supply Gippsland Growth Demand Base Demand Cooper Otway Source: Core Collaborative (AFR) June 2007

46 Spot Gas at Unprecedented Prices Spot gas prices in 2007 winter: Average >$25/GJ in eastern Australia Peak sales at >$400/GJ Ex-Moomba prices >$35/GJ Contributing factors: Delays in new supplies Colder than average winter Storage volumes down Hydroelectricity and coal fired power constrained by drought

47 Geothermal Exploration Beach farming in to earn 21% interest in 4 geothermal exploration licences in SA Contribute up to $10 million to drill 1-2 wells to demonstrate hot rock energy resource Can contribute a further $20 million to earn a total 36% - install 7.5 Mw plant to supply power to Beverley Uranium Mine Close to entry points in main transmission grids

48 Paralana Geothermal Project

49 Large Scale CO2 Storage Long term carbon storage hub in depleted gas reservoirs in Cooper Basin: Large scale (> 20 million tpa) large capacity (>400 million tonnes) Secure storage solution for eastern seaboard CO2 emissions Initial Demonstration Phase proposed to store up to 1 million tpa from 2010

50 Outlook for FY08 Production ~10 mmboe ~35% Oil Development: Basker Oil Development Manta-Gummy Gas Appraisal/Development Tipton West CSG Expansion Callowonga Oil Appraisal Drilling & Flowline Exploration: Total of 200 wells in FY 2008 Cooper Oil Project (~155 wells) Tipton West Project (26 wells) Increased Offshore & International Focus (at least five wells planned for 2008) Paralana Geothermal

51 Over 200 wells programmed between now and Q COOPER COOPER / EROMANGA / EROMANGA BASIN BASIN Beach Beach Operated Operated Wells Wells 1 1 Stuart Stuart Operated Operated Well Well SA SA Cooper Cooper Oil Oil Program Program Wells Wells QLD QLD Cooper Cooper Oil Oil Program Program Wells Wells Naccowlah Naccowlah Block Block Wells Wells 6 6 SA SA Gas Gas Exp/Dev Exp/Dev Wells Wells 3 3 QLD QLD Gas Gas Exp/Dev Exp/Dev Wells Wells ARROWIE BASIN 11 Geothermal Well BASS BASIN 11 T/38P Well 11 T/39P Well SURAT BASIN SURAT BASIN 13 Tipton West Block Wells 13 Tipton West Block Wells 10 Dalby South Block Wells 10 Dalby South Block Wells 3 Millmerran Block Wells 3 Millmerran Block Wells GIPPSLAND BASIN GIPPSLAND BASIN 1 Basker Well (2007) 1 Basker Well (2007) Possibility of 2 more Basker Possibility of 2 more Basker Wells, Wells, 1 Gummy Well &1 Manta Well 1 Gummy Well &1 Manta Well TARANAKI TARANAKI BASIN BASIN 11 PEP PEP Well Well CANTERBURY BASIN BASIN 1 1 PEP PEP Well Well (2008) (2008)

52 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.

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