2012 Half Yearly Results 23 August 2012
Forward looking statements This presentation may contain forward-looking statements and information that both represents management's current expectations or beliefs concerning future events and are subject to known and unknown risks and uncertainties. A number of factors could cause actual results, performance or events to differ materially from those expressed or implied by these forward-looking statements. 23 August 2012 | Page 1
Agenda Introduction Simon Lockett Operations update Neil Hawkings Exploration update Andrew Lodge Financial results Tony Durrant Outlook Simon Lockett 23 August 2012 | Page 2
Premier today ... is in an even stronger position than ... which is reflected in our first half six months ago ... results • Stronger production and resource base • Production up 58% year-on-year; pro-forma resources of 725 mmboe • Portfolio of operated developments will • Solan, Pelikan, Naga and Dua approved; deliver 100,000 boepd Catcher moving forward • Acquisition activity positions us for future • Falkland Islands transaction growth beyond 100,000 boepd • Transforming the exploration portfolio • Prospective resource portfolio increased to 2.7 billion boe • Existing projects, dividend and future • $1.3 billion of cash and undrawn facilities; exploration programme fully funded strongly rising cashflows and profitability Historic NAV/share CAGR of 14.2% at constant oil prices 23 August 2012 | Page 3
Operations update 23 August 2012 | Page 4
Production update • Production averaged 58,400 boepd, up Huntington/Rochelle 2012 Production Other UK (bbls/day) 58 per cent Pakistan & Mauritania Vietnam – Q2 production in excess of 60,000 boepd 80,000 Indonesia • Chim Sáo and Gajah Baru performing well 70,000 • Strong Pakistan production due to compression 60,000 upgrades and successful infill drilling • Improved uptime at Balmoral and good 50,000 production from a new well at Scott • Increased share of Wytch Farm production 40,000 following completion of acquisition 30,000 • 75,000 boepd, once Huntington and Rochelle on-stream 20,000 10,000 0 Q1 Q2 Q3 Q4 Year end run rate 23 August 2012 | Page 5
Chim Sáo and Dua Chim Sáo • 1H Production averaged 26,000 boepd; higher level of uptime achieved in Q2 • Currently producing at 35,000 boepd • Water injection has commenced and rates are ramping up to support reservoir pressure • Two well supplementary drilling programme into additional reservoirs completed in June – first well tied-in; initial production rate of 4,000 boepd – second well due on-stream in Q3 • Total well capacity in excess of 40,000 bopd Dua • Dua will develop ~10 mmbbls • Prime Minister approval of FDP received in August • Long lead items being procured and contracted • Development drilling to commence in April 2013 • Subsea installation and tie-in in Summer 2013 • First oil 2014 23 August 2012 | Page 6
Natuna Sea Block A GSA 1 (Anoa) • 1H production at maximum capacity • Block A’s share of deliveries under GSA1 was 47% against a contractual market share of 37% • Block A’s share of remaining reserves dedicated to GSA1 was 64% at start of year (before the Anoa Deep discovery) GSA 2 (Gajah Baru) • Production facility has performed very well • All Singapore demand was met during the period but build-up of rates has been slower than anticipated due to end user project delays Gas Swap Agreement (Gajah Baru) • Discussions to sell an additional 40 BBtud into the Indonesian domestic market continue 23 August 2012 | Page 7
Anoa Phase 4, Pelikan and Naga Anoa Phase 4 Pelikan and Naga • Project will increase Anoa reserves by ~200 bcf • Pelikan and Naga will develop ~150 bcf of gas by lowering surface flowing pressures • EPCI contract awarded in May • Also increases Anoa capacity above 200 BBtud – Construction of jacket / topsides commenced • Construction barge has arrived on location; • Construction of pipeline material underway compression modules currently being installed • Tendering process to secure a rig for 2013 and • Second construction campaign prior to first gas 2014 development drilling commenced in Q3 2013 • First gas 2014 23 August 2012 | Page 8
Huntington and Rochelle Huntington Rochelle • Development drilling completed in August • Drilling of East Rochelle, the first of the two development wells, is in progress – To schedule and on budget – Better than expected well results • Upgrade of Scott Platform remains on track – Debottlenecking study underway • Subsea installation underway following the • FPSO onshore modifications nearing completion arrival of the pipe lay vessel • Operator expecting first gas in December • Operator targeting sail away in September for installation in October and first oil in December 23 August 2012 | Page 9
Solan • Premier is Operator with 60% equity • All significant contracts have been awarded – Procurement and fabrication of platform (Burntisland Fabrications) – Heavy lift installation (Heerema) – Subsea tank fabrication (Dry Docks World Dubai) – Drilling rig (Awilco) • Construction of topsides has commenced • Phase 1 development drilling expected to commence in March 2013 • First oil targeted for Q4 2014 with an initial production rate of 24,000 bopd 23 August 2012 | Page 10
Solan development schedule 2012 2013 2014 Government Approval First Oil Platform Tank Drilling Installation, Hook-up and Commissioning FEED Design and Procurement Construct 23 August 2012 | Page 11
Catcher update Significant licence changes • Premier increased stake to 50% and appointed operator • Strengthened partnership to progress development • Time is needed to achieve consensus within new JV Concept Selection work • JV agreed subsurface work programme is in progress to generate resource volume ranges • Schedule and cost data for development concepts has been validated through market enquiries FPSO and Subsea Wells • Contracting strategies have been developed • Concept Selection Recommendation has recently been made to JV • Continue to work with JV to expedite approval process and first oil now modelled for early 2016, subject to FPSO contractor discussions 23 August 2012 | Page 12
Non-operated projects Bream • Completed SPA with Skeie in July; increased equity in Bream to 40% • FPSO and SURF FEED near completion • Operator planning project sanction in October – Cost pressures – Scope for area development exists • Operator targeting 2015 for first oil Frøy Block A Aceh • Joint Area Studies are underway with other • EPCI re-tender resulted in higher than operators to identify and evaluate the anticipated bids preferred options for an area development – Revisiting gas price with buyer 23 August 2012 | Page 13
Sea Lion – transaction rationale • Progresses Premier’s strategy of growth through Pro-forma 2P Reserves and 2C Contingent Resources (mmboe) investment in high quality development projects 800 • Provides a further operated core area for Premier 600 in a new oil prone basin • Leverages Premier’s strong operatorship and 400 FPSO development capabilities 200 • Ongoing exploration opportunities in the North 0 Falklands basin, leveraging Rockhopper’s proven 2P Reserves 2C 2P Reserves Falkland Pro-forma 2P Contingent & 2C Islands Reserves & 2C exploration expertise Resources Contingent Farm-in Contingent Resources Resources • Adds approximately 200 mmbbls of net discovered Pro-forma 2P Reserves and 2C Contingent Resources 2C resources at a low upfront cost, together with Split by Region net risked prospective resources of 175 mmboe Falkland Islands North Sea • Significantly extends Premier’s production growth 28% 31% beyond current development projects and is an excellent fit with strongly rising cash flows Total ~725 • Fully funded from a combination of existing cash mmboe resources, facilities and cashflow from operations; commitment to fund dividend unchanged Pakistan & Mauritania Asia 9% 32% 23 August 2012 | Page 14
Sea Lion – development plan • FPSO in 450m water depth; tanker offloading • Associated gas used as fuel or re-injected • 22 producers, 13 water injectors and a gas injector, drilled from 3 subsea centres • Insulated flowlines and risers • Hydraulic submersible pumps (HSPs) for artificial lift and flow assurance • Gross plateau rate of 80-85 kbopd – 120 kbopd produced fluids – 200 kbwipd – 140 kbwpd power fluid for HSPs – 60-90 mmscfd gas handling • Assumed capex to first oil of $3.2 billion (purchased FPSO) • Subsequent development of satellite fields 23 August 2012 | Page 15
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