Interim Results Presentation. 16 September 2004

Transcription

1 Interim Results Presentation 16 September 2004

2 Presentation Introduction Finance and Operations Business Development Summary and Outlook Sir David John John van der Welle Robin Allan Charles Jamieson Interim Results Presentation Page 2

3 Finance and operations Interim Results Presentation Page 3

4 Financial highlights Steady production performance 35.2 mboed (2003: 35.3 mboed*) Strong gas demand in Pakistan and Indonesia Turnover, operating profit and operating cashflow All down on a comparative basis due to a weak US$ and more gas in the production mix Net profit after tax Healthy cashflow: Operating cashflow Net cashflow Strong balance sheet 14.5m (2003: 12.8m**) 38.6m 5.4m Net cash 15.5m Lower interest charges Cashflow sufficient to cover all operating and capital expenditure In line with strategy * comparatives for 2003 are with ongoing operations i.e. assets retained post restructuring ** restated in line with 2003 results Interim Results Presentation Page 4

5 Operational highlights UK Production 12,000 boepd Successful infill drilling at Wytch Farm Kyle well tie back (October production) Negotiating to extend life of Kyle and Fife Area fields Indonesia Production 13,100 boepd Offtake greater than DCQ Gas sale negotiations continue Pakistan Production 10,100 boepd Qadirpur facilities upgrade to 500 mmscfd throughput completed Zamzama phase 2 progressing to gas sales negotiations Kadanwari K14 well to be tied back for production start in November Mauritania Chinguetti field development approved first oil Q Working interest production (barrels of oil equivalent per day) 40,000 30,000 20,000 10, H 2003 (ongoing) 1H 2004 Indonesia Pakistan UK Interim Results Presentation Page 5

6 Profit & loss Half year to 30 June 2004 Half year to 30 June 2003 (Ongoing) m 83 (11) 72 (14) (18) (4) 36 (4) (8) 1 31 (18) 13 NA Production (mboepd) Realised oil price ($/bbl) Realised oil price ( /bbl) Realised gas price ($/mcf) Realised gas price ( /mcf) Turnover less: share of JV turnover Group turnover Operating costs Amortisation Exploration expenditure written off Gross profit Administration costs Operating profit Operating profit in JV Total operating profit Net interest Exchange gain Profit before tax Taxation Profit after tax Earnings per share - diluted (pence) m 75 (14) 61 (16) (15) (3) 27 (4) (1) 1 33 (18) Working interest production Turnover down more gas production, weaker dollar Unit opex (incl JV) 2.67/boe - up 10% vs ongoing operations mainly due to fixed costs with reduced production in UK fields Unit DDA (incl JV) 2.96/boe JV represents Pakistan only Reduction in net debt Tax restated for change in method of calculation of overseas tax (per 2003 annual report) Using new consolidated shares Interim Results Presentation Page 6

7 Cashflow Half year to 30 June 2004 (As reported) m Half year to 30 June 2004 (Incl JV) m Half year to 30 June 2003 (Ongoing, Incl JV) m Net cash flow from operations Net interest Taxation Operating cash flow (after interest and tax) Capital expenditure Disposals Net cashflow Exchange/other Movement in net debt Yetagun interest accrued Opening net cash/(debt) Closing net cash/(debt) 41 - (13) 28 (24) (13) 39 (33) (9) (12) 47 (34) NA NA Lower turnover and operating cashflow, partly offset by reduction in interest Capital expenditure increased spend on exploration Excl JV JV Total Total m m m m Exploration Fields Other JV funding * (8) * Pakistan net payment to Premier by JV in 2004 Operating cash flow covers exploration 2.2x Interim Results Presentation Page 7

8 Future field capex programme Development CAPEX ( million) Indonesia 2 nd Sale (contingent) Tiof (contingent) Chinguetti Indonesia Pakistan UK Averaging 18 million to 32 million pa depending on Tiof /2 nd sale Interim Results Presentation Page 8

9 Reserves and production Total 2P reserves ~200+ mmboe (1) Mauritania Unbooked (2) Indonesia Working interest production (barrels of oil equivalent per day) 40,000 Indonesia 2 nd Sale (contingent) Tiof (contingent) Chinguetti Indonesia Pakistan UK UK 30,000 Booked reserves 175 mmboe: 80% gas; 20% oil Pakistan 20,000 10,000 (1) Total reserves defined as booked and unbooked 2P WI reserves (2) Unbooked reserves relate to Indonesia and Mauritania Interim Results Presentation Page 9

10 Business development Interim Results Presentation Page 10

11 2004 Business development strategy Exploration led, commercially driven 25m p.a. exploration expenditure 12 to 18 well programme p.a. 1/3 of wells offer step change growth opportunity Focus on Africa and Asia Interim Results Presentation Page 11

12 18 month plan AFRICA Mauritania : Tevét A : Capitaine A : Tiof A : Merou A : Tiof B : Tiof C : Exp. Well : Tiof: D : Exp./App. Wells Gabon : Dussafu-1 : Iris-1 : Themis-1 Egypt : Al Amir-1 Guinea Bissau ASIA Pakistan : Dumbar : Indus Offshore India : Jaipur-1 : Cachar-1 Indonesia : Gajah Baru-2 : Macan Tutul-1 Vietnam : 12E & 12W Exp. Well : 12E & 12W Exp. Well : 7,8/97 Exp. Well UKCS UKCS : Palomino JUL AUG SEP OCT NOV DEC 2004 JUL AUG SEP OCT NOV DEC 2004 JUL AUG SEP OCT NOV DEC 2005 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Contingent wells 2005 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2005 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Interim Results Presentation Page 12

13 Africa Gabon Dussafu-1 Gabon Interim Results Presentation Page 13

14 Africa Gabon: Dussafu Mytilus-1 Projected Dussafu-1 Well Location Dussafu Prospect Interim Results Presentation Page 14

15 Africa Mauritania Mauritania Interim Results Presentation Page 15

16 Africa Mauritania: drilling programme 2004 JUL AUG SEP OCT NOV DEC Chinguetti-J Tevét Capitaine Tiof A Merou Tiof-B Tiof C Top Holes Tevét, Capitaine Tiof A 2005 JAN FEB MAR APR MAY JUN SEDC Prods SE WI SWDC Exp. Well Tiof D DP Rig All Top Holes NDC Exp./App. Wells Banda-D Exp./App. Wells DP Rig - SEDC DP Rig SE WI DP Rig SWDC DP Rig NDC Banda-D WEST NAVIGATOR RIG STENA TAY RIG RIG Exploration Appraisal Chinguetti Development Well Completions Non-interest Operations Interim Results Presentation Page 16

17 Africa Mauritania: exploration prospects Tevét Banda Tiof Chinguetti Bogue Sotto Lead 100 Lead 60 Capitaine Merou Tenit 3D Area N Dor Fantar North MIS20 TWT surface Interim Results Presentation Page 17

18 Africa Mauritania: Tiof Tiof West-1 Tiof-1 3D visualisation of Miocene sands draped over structure Brighter colours indicate presence of hydrocarbons and sands. Their location varies throughout the seismic volume due to the braiding of the channel system Up to 4 appraisals Interim Results Presentation Page 18

19 Africa Mauritania: Tevét Tevét Banda Tevét, if successful, would be tied back to the Chinguetti development. Amplitudes at the prospect are similar to those seen at Chinguetti, suggesting the presence of similar reservoir and hydrocarbons. Chinguetti 3D visulisation of Miocene sands draped over structure Interim Results Presentation Page 19

20 Africa Mauritania: Capitaine S N Top Reservoir Depth 2km Top Reservoir Amplitude 10km Interim Results Presentation Page 20

21 Africa Mauritania: Merou Bright amplitudes in the Miocene section over the Merou structure W E Merou 2.5 km Salt Interim Results Presentation Page 21

22 Africa Egypt NW Gemsa Block, Gulf of Suez Basin Premier equity: 37.5% Operator: Kriti (Vegas) 3D seismic programme acquired Al Amir-1 to spud in December onshore flat desert terrain well cost under $3m gross targeting prospects of up to 100m bbls block potential > 200m bbls Egypt Interim Results Presentation Page 22

23 Africa Egypt: NW Gemsa Block GAS PIPELINE OIL PIPELINE SAKARA DISCOVERY (June 2003) REC : 80 m bbls EAST ZEIT DISCOVERY (Oct 2001) REC : 70 m bbls Al Amir-1 Interim Results Presentation Page 23

24 Africa Egypt: NW Gemsa Block Proposed Al Amir-1 Zeit Bay-1 Al Amir-1 will drill a shallow trap and investigate the deeper stratigraphy. A subsequent contingent well may be drilled to test the deep pre-rift. Top S Gharib Top Belayim Top Kareem Top Rudeis Top Lwr. Rudeis Top Pre-rift Interim Results Presentation Page 24

25 Africa Guinea Bissau Interim Results Presentation Page 25

26 Africa Guinea Bissau: Sinapa & Esperanca Sinapa-2,2z The results of the Sinapa-2,2z well have significantly reduced the risks of the salt diapir flank play in Guinea Bissau programme will include new 3D seismic acquisition followed by exploration and appraisal drilling. Interim Results Presentation Page 26

27 Africa Guinea Bissau 2005 Sabayon Sinapa-1 Sinapa-2,2z Sardinha Solha Espinafre Espargos Eirozes Encharcada Espadarte Espetada Empada El Linguada Ervas Interim Results Presentation Page 27

28 Asia Indonesia Natuna Sea Block A Premier Equity: 28.67% Operator: Premier Gajah Baru-2 appraisal & deep exploration well supporting existing and potential new gas sales and targeting increased reserves Macan Tutul-1 step-out well moved to 2005 Interim Results Presentation Page 28

29 Asia Indonesia: Gajah Baru-2 location Gajah Baru-2 will appraise the Upper and Middle Arang reserves discovered by Gajah Baru-1. Additionally it will appraise deeper Gabus gas and oil discovered by Gajah-1. Gajah Baru-1 Gajah Gajah-1 Gajah-2 Baru-2 Interim Results Presentation Page 29

30 Asia Indonesia: Gajah Baru-2 location Gajah Baru-1 Gajah-1 Gajah Baru-2 Gajah-2 Interim Results Presentation Page 30

31 Asia India Interim Results Presentation Page 31

32 Asia India: Jaipur Block Lakkhi-1 Legend Prospect Oil Field Premier Block Interim Results Presentation Page 32

33 Asia Vietnam Interim Results Presentation Page 33

34 Asia Vietnam: prospects map Interim Results Presentation Page 34

35 Asia Vietnam: Block 7,8/97 seismic 2D seismic May D seismic September km of new seismic data being acquired using vessel MV Polar Duke Interim Results Presentation Page 35

36 Asia Vietnam 2005: Block 12E & W Swan Complex 12W-HA-1x tested at 24 MMscf/d with 829 bc/d. Canary Complex 12-C-1x tested at 8.2 MMscf/d Lark 12-LK-1X recovered 45 barrels of oil from the Upper Oligocene Cau Formation Dua Field Dua-1X tested 1540 bopd of 39 API oil from the Mid Miocene Dua Formation 1557 km of new 2D seismic data planned for acquisition using vessel MV Polar Duke, 2004 Interim Results Presentation Page 36

37 2005 programme Taking shape Mauritania - up to 9 E&A wells (dependent on 2004 programme) Guinea Bissau - up to 3 wells Vietnam - 1 to 3 wells Plus 1 well in each of UK, Gabon, Egypt, Pakistan, India & Indonesia Interim Results Presentation Page 37

38 18 month plan AFRICA Mauritania : Tevét A : Capitaine A : Tiof A : Merou A : Tiof B : Tiof C : Exp. Well : Tiof: D : Exp./App. Wells Gabon : Dussafu-1 : Iris-1 : Themis-1 Egypt : Al Amir-1 Guinea Bissau ASIA Pakistan : Dumbar : Indus Offshore India : Jaipur-1 : Cachar-1 Indonesia : Gajah Baru-2 : Macan Tutul-1 Vietnam : 12E & 12W Exp. Well : 12E & 12W Exp. Well : 7,8/97 Exp. Well UKCS UKCS : Palomino JUL AUG SEP OCT NOV DEC 2004 JUL AUG SEP OCT NOV DEC 2004 JUL AUG SEP OCT NOV DEC 2005 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Contingent wells 2005 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC 2005 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC Interim Results Presentation Page 38

39 Summary and outlook Interim Results Presentation Page 39

40 Summary and outlook Ingredients for Independents success Clear strategy / a good story Resources to play the game Leverage to success Just 1 or 2 successes needed Interim Results Presentation Page 40

41 Appendix Interim Results Presentation Page 41

42 Premier recent history West Natuna Indonesia 1996 Purchased Anoa block from Chevron for $72 million 1997/8 Drilled up gas. Negotiated WNG sale to Singapore. Largest pipeline gas project in SE Asia 1999 onwards Development and production operator 2003 Sold 38% at profit of nearly 3x net investment as part of restructuring Myanmar 1997 Assumed operatorship on Texaco withdrawal. 1998/9 Negotiated GSA and managed $650 million development 2003 Sold to Petronas as part of restructuring for $400 million Pakistan 1997 Discovered 2 tcf Zamzama field 1998 Premier/Shell partnership 2001 Extracted value through sale to KUFPEC - $114 million 2003 Further discoveries at Zamzama and Kadanwari Exploration record Industry survey. 1st in 2 categories - reserves replacement/finding and development costs - large independents Corporate 1999 Petronas/Amerada Hess $200 million equity injection, SE Asian pipeline gas strategy 2003 Restructuring. Petronas/Amerada Hess depart. Myanmar sold. Negligible resultant debt 2003 Fusion deal Mauritania drilling success Interim Results Presentation Page 42

43 Areas of operation and strategy High impact explorer and commercial dealmaker Base business e.g ,000 boepd Cycle out/farm down assets when significant growth potential has been exploited Realise early value for shareholders Interim Results Presentation Page 43

44 Production operations UK Mature production, mainly oil Wytch Farm (picture), BP operated Kyle and Fife area fields UK production ~12,000 boepd, reserves 24 mmboe Interim Results Presentation Page 44

45 Production operations - Indonesia West Natuna Gas (WNG) project Premier operated 650km pipeline to Singapore Production commenced year gas contract Indonesia production ~13,000 boepd, reserves 79 mmboe Interim Results Presentation Page 45

46 Production operations - Pakistan Onshore gas all in production, offshore exploration block (Shell) Bhit (picture) and Zamzama on-stream 2003 Long-term gas contracts, in dollars Successful drilling late 2003 Pakistan production ~10,000 boepd, reserves 63 mmboe Interim Results Presentation Page 46

47 Development ops Mauritania: Chinguetti Development approved May 2004 Reserves of 120 mmbbls (Premier share 9.7 mmbbls) Development cost $600 million (Premier share $55 million) First oil Q building to 75,000 bopd (Premier share 6,100 bopd) Interim Results Presentation Page 47