Dunraven Resources plc Corporate Presentation April 2018 Copyright Dunraven Resources Plc 2018
Disclaimer This presentation contains certain statements which may constitute "forward-looking statements. Such statements are only predictions and are subject to inherent risks and uncertainties which could cause actual values, results, performance or achievements to differ materially from those expressed, implied or projected in any forward-looking statements. No representation or warranty, express or implied, is made by Dunraven Resources plc that the material contained in this presentation will be achieved or prove to be correct. Specifically, references to gas in place, or GIP / oil in place, or OIP refer to estimates of unrisked, unproven resource potential, based on parameters derived from existing well data and rock sample descriptions, and general literature, and should be considered as speculative. Except for statutory liability which cannot be excluded, each of Dunraven Resources plc, its officers, employees and advisers expressly disclaims any responsibility for the accuracy or completeness of the material contained in this presentation and excludes all liability whatsoever (including in negligence) for any loss or damage which may be suffered by any person as a consequence of any information in this presentation or any error or omission there from. Dunraven Resources plc accepts no responsibility to update any person regarding any inaccuracy, omission or change in information in this presentation or any other information made available to a person nor any obligation to furnish the person with any further information. Investment indunraven Resources plc should be considered speculative. 2
Contents Introduction 4 Internationally Experienced Team 5 Global Experience 8 Tunisia Country Profile 9 Principal Assets 11 Mahdia 13 Beni Khaled 19 Work Programmes 21 Summary 24 Contact 25 Appendices 26 3
Introduction Dunraven Resources Plc ( Dunraven ) is building an Exploration and Production (E&P) company with an initial focus on North Africa and the Middle East. The Company s strategy is to deliver value to shareholders and to the countries in which it operates through participation in E&P projects. The Board and Executive team have a strong background in E&P, solid industry reputations, long-standing relationships with major oil companies, finding success, and strong governmental relationships at a senior level. It is intended that rapid progress be made towards production and income growth with the combination of opportunities and the team involved. Having identified Tunisia, where it has significant in-country experience, as an initial target for Dunraven s activities the Company recently acquired 100% of Circle Oil Tunisia Limited. Tunisia is seen as an oil and gas growth opportunity. Despite its significant existing oil and gas infrastructure and variety of hydrocarbon habitats, the country is a net importer of hydrocarbons. Growth will be achieved through a combination of organic development and strategic acquisitions. 4
Internationally Experienced Team Thomas Anderson Non-Executive Chairman 30 years direct executive experience running companies in the leisure, fund management, forestry & oil & gas industries Former Chairman of the quoted Circle Oil Group (1995 2007) Executive Chairman of The Empire Cinema Group in Britain, of Irish Medical Systems, and Oglesby & Butler and is a director, and controlling shareholder, of Terrabiogen. Alex MacDonald Chief Executive Over 30 years experience in energy sector, in operations and finance. Former chief executive of Anglo African Oil & Gas plc Led Whitman-Howard s oil & gas team and held a similar position at Libertas Capital Corporate Finance LLP, when he was mainly involved in fund raising and M&A activities. He has both public and private company experience Early career in upstream exploration, mainly in Africa, the Middle East and the North Sea with Conoco, Chevron, Atlantic Drilling, Otis Wireline and Ocean Inchcape John McKeon Founder & Director Extensive network of business and political contacts across the world Founding shareholder and former executive director of Circle Oil Plc where he was instrumental in building the international oil and gas E&P company with assets spanning Egypt, Morocco, Tunisia, Oman and Namibia. Has listed a number of companies on AIM in London Founding shareholder, and chairman of Ardilaun Energy Limited, an Irish energy company focused on exploring for and developing oil and gas resources in offshore Ireland. 5
Internationally Experienced Team Brendan McMorrow Finance Director 25 years experience in a number of publicly listed companies in the oil and gas and base metals mining sectors listed in London, Toronto and Dublin. Chief Financial Officer of Circle Oil Plc from 2005 to 2015, responsible for all corporate, financial and funding matters. Non-executive Director of Conroy Gold Fellow of the Chartered Association of Certified Accountants. Cathal Jones Corporate Finance Qualified as a Chartered Accountant with Price Waterhouse Coopers prior to spending 12 years with Deloitte s corporate finance team Former Member of Deloitte s Energy and Resources national industry leadership team, advising clients in the oil and gas, mining and renewable energy sectors Finance Director of Ardilaun Energy since August 2014. Fellow of the Institute of Chartered Accountants in Ireland. Rowan Pearson Business Development An Economics graduate, with a Masters in International Business Studies, Rowan has spent the past 9 years in London in the small-cap M&A industry. With a focus on emerging markets and natural resources, Rowan has been involved in the restructuring and refinancing of many projects in Europe and Central Asia, availing of both private equity and various public markets. 6
Technical Team Ali Chine (Country Manager) Ali, a petroleum geologist and former president of the Tunisian state oil company (ETAP) and was previously energy advisor to the Tunisian Minister of Industry and Energy. Throughout his career he was a board or general member of a number of professional organisations, particularly in the petroleum sector. Adrian Burrows (Chief Geoscientist) Adrian, a geoscientist, has more than forty years experience, initially with major operators on exploration and production projects. He has successfully managed acquisition, processing and interpretation teams and coordinated strategy and operations. In the past he has also led data management and software development projects. His CV includes senior positions with Amoco, Occidental, ELF, RPS, PGS and Circle Oil Plc. Dr. Enzo Zappaterra (Senior Geologist) Enzo is an AAPG (American Association of Petroleum Geologist) certified petroleum geologist with a broad international experience gained through more than four decades of active oil & gas exploration in a variety of positions, including management, with Chevron and its affiliates, and as a consulting geologist in many of the world s oil basins (Africa, Asia, South America, Europe). Enzo has a broad knowledge of all functional aspects of regional petroleum exploration and management, from assessing business opportunities in frontier areas, to building the necessary industry and government relationships, and following through to accomplish company goals and objectives. Technical & Operational Support The Company has entered into negotiations with a major international technical services company to provide the technical and operational resources necessary to develop the Company s Tunisian assets. 7
Dunraven Global Experience The management and technical team of Dunraven Resources have decades of experience participating in projects all over the globe in the natural resources sector both in mining and oil and gas. Dunraven is an Irish company developing its international capabilities. An associated company, Ardilaun Energy (a company with some common controlling shareholders), is currently one of the most significant exploration acreage holders offshore Ireland. 8
Tunisia Significant recent improvement in government attitude towards working with the industry participants with a focus on creating an attractive investment climate to draw new participants. Recent estimates of remaining national oil and gas reserves are ~ 800mmboe split approximately 50:50 between oil and gas. Production, currently 44,000bopd, has been declining since 2010. Tunisia is a net importer of hydrocarbons, thus providing a ready market for new and additional oil and gas production. Tunisia already has significant oil and gas infrastructure with access to export markets. Favourable fiscal regime in place. Inward investment initiatives: In February 2018, The Carlyle Group announced its investment in Mazarine Energy, an upstream oil and gas company with existing assets in Tunisia. Carlyle will also grant Mazarine Energy access to an equity line of up to $500 million to fund future bolt-on acquisitions. 9
Fiscal & Regulatory Environment Tunisia offers Joint Venture agreements and PSAs, although PSAs are rarely issued. The use of a profit-sensitive R-factor mechanism for determining royalties and profit tax ensures that investors are not burdened with high levels of upfront payments in early project stages. Low royalty rates of between 2 15% for JVs, and a profit tax between 50 75% apply to JVs, while for PSAs cost recovery is generally between 40 50% ETAP pays the contractors profit tax Regime Production Sharing Agreement Exploration Obligations Each exploration renewal carries a 1-well commitment Governing Law The Hydrocarbon Law of 1999 & Code Des Hydrocarbures (2017) Income Tax Paid by ETAP (50%) 10%-30% exploration uplift for deposits which are difficult to access, gas deposits or deep deposits as Investment Uplift recoverable costs. Licence Duration Exploration permit: 5 years with up to two 4-year extensions. Production: 30 years Licencing Authority Ministry of Industry, Technology & Mines National Oil Company L Entreprise Tunisienne d Activités Pétrolières (ETAP) Profit - Sharing Negotiable. Contractor share around 15-40% based on R-factor Regulatory Agency Ministry of Industry, Technology & Mines Royalties Paid by ETAP (2-15% based on R-factor) Contract Type Production Sharing Contract Cost Recovery Negotiable limit ~40-50% Domestic Market Obligation 20% at 10% discount to market price for liquids 10
ASSETS
COTL s Principal Assets Mahdia Permit Gulf of Hammamet Area: 3,024 km² Proof of working petroleum system: EMD-1 well light oil (2014 Ketatna) Mahdia-2 discovery 2,700 bopd (2012 Serj) 100% owned by COTL Licence recently extended to January 2020 Cap Bon Concession Concession located in the Cap Bon Peninsula Licence area contains the Beni Khaled oil field and the undeveloped Bir Drassen discovery well BDR-1, drilled in 1991 Current Operator: Exxoil SA COTL has the right under a farm-in agreement to acquire up to 50% of Exxoil s interest in the concession. 12
Mahdia Field Gulf of Hammamet Mahdia Block Area: 3,024 km² Licence extended to January 2020 2 well commitment and 300 km 2 3D seismic Proof of working petroleum system: EMD-1 well light oil (2014 Ketatna) Mahdia-2 discovery 2,700 bopd (2012 Serj) Other Gulf of Hammamet fields 2D seismic: 3,000 km 2 legacy data 2D seismic: 509 km 2 Circle Oil 2009 3D seismic: 300 km 2 Circle Oil 2012 13
Mahdia Geological Status Petroleum system proven; gas sand indicated above one structure and seal effectiveness established for pre-saouaf reservoirs El Mediouni East & Central discovered resource estimates of 70.5mmbbls (most likely) and 144mmbbls (max) based on EMD-1 well; analogue structures on 3D and 2D mapping Deeper, as yet unpenetrated, reservoirs may exist in Ketatna matrix and reservoir; All leads are similar structures to El Mediouni, but apart from El Mediouni West (within 3D area) more seismic is required to confirm drillable prospects Tilted Fault Block Traps located in grabens with thick overburden Individual Areal Closures 8 to 18 km² Vertical Relief 240 to 340m Individual STOOIP ranges 40 to 458 mmbbl Target Ketatna Reservoir (1,000 to 2,500m below MSL) 14
Mahdia Geological Prospectivity 2 legacy wells drilled regional horsts (Alfil and Mactaris) Tested basement highs, limited sample of regional geology Encountered thick carbonates with minor shale intercalations Several play types in structural and stratigraphic traps Birsa sands (Miocene) Ketatna carbonates (Oligo-Miocene) Abiod limestones (Campanian E. Maastrichtian) Serdj dolomites (Aptian) Proven petroleum systems and multiple source levels Boudabbous shales (Eocene) Bahloul & Fahdene shales (Mid-Cretaceous) Analogue fields/penetrations Oil : Tazerka, Birsa, Oudna, Halk el Menzel, Mahdia-2 (tested), Lotus-1 (shows) Gas condensate : Maamoura 15
Mahdia EMD-1 Well Results The well experienced severe flushing ahead of the bit and significant mud losses, followed by sea water fill and LCM pills (>12,000 barrels lost) resulting in no effective gas shows and poor retention of native hydrocarbons Lessons / Recommendations Use a semi-sub not a drillship To reduce weather downtime and improve performance Managed Pressure Drilling Gives better capability to drill zones with risk of lost circulation Logging While Drilling To provide information before standard wireline operations Formation Image Logs To identify the nature and frequency of fractures Re-design the well in light of EMD-1 Optimise the casing strings to deal with potential problems 16
Mahdia Field Development Concept In September 2015, COTL engaged ADIL (now a Schlumberger company) to compile an FDP for the El-Mediouni Field. ADIL identified and defined development concepts for two reserves cases in order to provide an indication of the range of investment that would be required: Base Case, consisting of El-Mediouni East with limited producing reservoir zones; Upside Case, comprising of El-Mediouni East, Central and West producing from multiple reservoir zones. Suitable development options for the reservoir were identified and defined using the following primary value drivers as a key consideration: Low CAPEX Early production Minimal technical risk Key Finding: The most suitable development would be a leased floating production system with storage and export by tanker. There is no infrastructure in the area so connection to existing facilities is not an option, while platforms and pipeline export options would be too Capex intensive. 17
Mahdia Economics Development economics (effective date: 1 January 2017) are expected to generate gross NPV (10% nominal), net to the Contractor of: Low Case: US$78m Upside Case: US$169m Indicative development capex phasing over 2 years, with first oil in 2020 Low Case: Initial rate of 25,000 bopd, under natural decline of 2.5% per quarter Upper Case: 4 year plateau production of 35,000 bopd, followed by natural decline of 2.5% per quarter Economic summary (forward curve) Low case High case EUR 55mmbbls 150mmbbls No. of wells 2 4 Peak production 25kboepd 35kboepd Capex $340m $768m Opex $13.4/boe $11.7/boe NPV @ 10% $78m $170m Break-even price $44/bbl $41/bbl NPV scenarios Low case High case $65/bbl flat $83m $179m $75/bbl flat $108m $242m $85/bbl flat $134m $298m 18
Beni Khaled Dunraven intends to complete its farm-in on the Beni Khaled production licence on the Cap Bon peninsula in north-eastern Tunisia. COTL signed a farm-in agreement in July 2013 with the operator, Exxoil, whereby, on completion of certain work programmes, it will earn up to a 50% participating interest in the concession. An initial investment of US$5 million will cover 50km² of new seismic and the drilling of one low-risk well. 19
Beni Khaled Located in the Cap Bon Peninsula Licence valid until end of 2031; Operator: Exxoil SA ETAP holds an interest linked to cumulative production. Internal estimates of 3.8 mmboe of P2 reserves (600,000 have already been produced). Licence area contains the undeveloped Bir Drassen discovery well BDR-1, drilled in 1991- tested at a rate of 23.5 million ft 2 of gas p/d and 28 bbls/pd of condensate. Internal estimates that most-likely recoverable resources from Bir Drassen of up to 50 billion cubic feet of gas, and potentially six million barrels of oil in a prognosed oil rim. COTL will acquire an initial 30% interest by funding the acquisition of 50 km² of 3D seismic data, and by drilling one low-risk development well as part of the Phase 1 work programme. The farm-in agreement allows COTL to increase its interest in Beni Khaled to up to 50% in two further stages by providing funding of up to $2 million towards the cost of a single well in each stage. 20
WORK PROGRAMME
Mahdia Work Programme Timeline H2 2018 Desktop Review of all technical data Finalise location & tender for additional 300km² of 3D seismic data H1-H2 2019 H1-H2 2019 Seismic Shoot Seismic Interpretation & proposed drill location to be finalised Two appraisal wells to be drilled back-to-back to reduce Mob/Demob fees EMD-2 (appraisal/exploration well) Locate along crest of El Mediouni East Drill to base Ketatna (not reached by EMD-1) Log and test to assess fluid parameters (up to 50 mmbbls resources) Suspend to become a future producer EMD-3 (follow up appraisal/exploration well) Locate either downdip of EMD-1 & 2 or on El Mediouni Central Drill to 2,500m for Abiod and Serdj (Aptian) Log and test to confirm further potential resources up to 144 mmbbls Suspend to become a future producer H1-H2 2020 Plan for Offshore Production 22
BK Work Programme Timeline H2 2018 Confirmation of seismic parameters for 3D shoot Re-tender for 50 km² to ETAP approved contractor list H1-H2 2019 50 km² of 3D seismic data to be acquired Interpretation of seismic data H1-H2 2019 Drilling of appraisal well H1-H2 2020 Further wells based on results of seismic and appraisal 23
Summary Following the acquisition of COTL, Dunraven Resources is ideally positioned to become an active player in the region. Dunraven has identified a clear and deliverable strategy to progress both Mahdia and Beni Khaled. The management of Dunraven and COTL are committed to maintaining clear and constant lines of communication with ETAP, and the Company s financial and technical partners. Growth will be achieved through a combination of organic development and appropriate strategic acquisitions. 24
Contact Website: www.dunravenresources.com Telephone: +353 1 614 9334 Registered Office: Tunis Office: Alex MacDonald: 3300 Lake Drive, Citywest Business Campus, Dublin 24, The Republic of Ireland Immeuble Zarrad B 21, Sis Jardins Du Lac (Lac2), 1053 Tunis, The Republic of Tunisia. alex.macdonald@dunravenresources.com (CEO) +44 (0) 783 164 2064 Copyright Dunraven Resources Plc 2018 25
APPENDIX 1.Tunisian Reserves 3.Forecasts 2,.Active blocks 4. Planned fields
Tunisian Reserves Remaining Recoverable Recoverable Reserves Base Case Low Case High Case Base Case Low Case High Case Crude Oil (mmbl) 207.90 177.50 219.10 1,522.10 1,490.90 1,532.40 Condensate (mmbl) 98.60 87.10 106.80 165.30 153.80 173.50 Natural Gas (bcf) 1,683.60 1,444.00 1,780.70 3,495.40 3,254.90 3,591.50 Natural Gas Liquids (mmbl) 27.30 23.30 28.80 36.00 32.10 37.50 Total (mmboe) 614.30 528.60 651.50 2,305.90 2,219.20 2,342.10 Base Case Low Case High Case Remaining NPV10 (US$ mil) 15.376 10.946 18.92 Total Capital Expenditure (US$ mil) 57.813 48.541 62.35 Total Operating Expenditure (US$ mil) 53.689 44.473 58.253 Source: Global Data 27
# of Active Blocks Active Blocks 60 50 40 30 Company Licenced Blocks Entreprise Tunisienne d'activites Petrolieres 48 OMV AG 12 Eni SpA 11 Mitsubishi Corporation 8 Encore International Limited 8 Geofinance NV 5 Serinus Energy Inc 5 Perenco 4 Perenco Holdings 3 Sodeps 3 Others 53 20 10 0 Onshore Shallow Water Deepwater 28
mmcfd mbd Forecasts Crude Oil & Condensate 100 80 60 40 20 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Deepwater Onshore Shallow Water Natural Gas Production 350 300 250 200 150 100 50 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Deepwater Onshore Shallow Water 29
Reserves (mmboe) Planned Fields By Participants Planned Fields Operator Start Date Zarat Entreprise Tunisienne d'activites Petrolieres 2022 Nawara Gas Field Development Project OMV AG 2019 Zaafrane Mazarine Energy Bv 2018 160 140 120 100 80 60 40 20 0 Mazarine Energy BV Enterprise Tunisienne d'activites Petrolieres OMV AG Number of Planned Projects 30