Annual General Meeting 10 June 2015 June 2015 │ 1
Preface This presentation, which is confidential and is being supplied only to persons with professional experience in matters relating to investments for the purposes of the Financial Services and Markets Act 2000, does not constitute or form part of any offer or invitation to sell or issue, any offer or inducement to purchase or subscribe for, or any solicitation of any offer to purchase or subscribe for, any shares in the Company or securities in any other entity nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision in relation thereto. This presentation does not constitute a recommendation regarding shares of the Company. The information contained herein is for discussion purposes only and does not purport to contain all information that may be required to evaluate the Company and/or its financial position. This presentation and the associated slides and discussion contain forward-looking statements regarding SOCO, our corporate plans, future financial condition, future results of operations, future business plans and strategies. All such forward-looking statements are based on our management's assumptions and beliefs in light of information available to them at this time. These forward-looking statements are, by their nature, subject to significant risks and uncertainties and actual results, performance or achievements may be materially different from those expressed in such statements. Factors that may cause actual results, performance or achievements to differ from expectations include, but are not limited to, regulatory changes, future levels of industry product supply, demand and pricing, weather and weather related impacts, wars and acts of terrorism, development and use of technology, acts of competitors and other changes to business conditions. SOCO undertakes no obligation to revise any such forward- looking statements to reflect any changes in SOCO’s expectations with regard thereto or any change in circumstances or events after the date hereof. No reliance may be placed for any purposes whatsoever on the information contained in this presentation or on its completeness. Details included in this presentation are subject to updating, revision, further verification and amendment. The Company is under no obligation to update or keep current the information contained in this presentation. No representation or warranty, express or implied, is given by or on behalf of the Company or its subsidiary undertakings, affiliates, agents or advisers or any of such persons’ affiliates, directo rs, officers or employees or any other person as so to the fairness, accuracy, completeness or verification of the information or opinions contained in this presentation and no liability is accepted for any such information or opinions. By attending this presentation and/or accepting a copy of it, you agree to be bound by the foregoing limitations and conditions and, in particular, will be taken to have represented, warranted and undertaken that you have read and agree to comply with the contents of this notice including, without limitation, the obligation to keep this presentation and its contents confidential. June 2015 │ 2
2014: A Year of Delivery for SOCO • TGT development programme with eight wells drilled in 2014 • H5 development ahead of the first oil schedule in September/ October 2015 • Production performance of 13.6 KBOEPD (slightly below guidance) • ERC Equipoise study significantly enhancing understanding of TGT demonstrating full recovery potential • Lidongo discovery in Marine XI, Republic of Congo • $119m cash return to shareholders in 2014 June 2015 │ 3
2015 Outlook and Current Trading • Independent audit by Gaffney, Cline & Associates confirms management’s estimates of Commercial Reserves and Contingent Resources for the Company’s Vietnam assets as of 31 December 2014 released at Full Year Results • Production guidance for 2015 maintained at 10.5-12 KBOEPD • January to May production averaged 11.9 KBOEPD (TGT 10.2 KBOEPD and CNV 1.7 KBOEPD) • TGT programme for 2015 completed with five wells drilled and both rigs now released • TGT H5 development progressing well and ahead of the first oil schedule of September/October 2015 • TGT partners working with the JOC to submit updated RAR/FDP for TGT in Q3/Q4 respectively • Continued focus on cost savings at JOC and SOCO level • Capex and opex savings of c.10% have been reflected in 2015 Vietnam expenditures • Cost savings in Africa and closing down new ventures office – targeting 25% of associated G&A • Board proposed 10 pence per share dividend (c.$50m) to be approved at the AGM and paid on 19 June • This would bring total cash returns to shareholders to $384m since 2013 June 2015 │ 4
Partner Reaction to Oil Price and Uncertainty • Reduced partner appetite to commit to $140/bbl spending development capital in current oil $130/bbl price environment $120/bbl • 2015 production target of 10.5-12 KBOEPD $110/bbl below 2014 $100/bbl • Limited willingness to perform water shut-offs $90/bbl or recompletions to date $80/bbl • Recently completed 2015 drilling programme $70/bbl limited to current FDP approved wells $60/bbl • Cost reduction initiatives underway $50/bbl • JOC continues to progress updated RAR and $40/bbl 2009 2011 2013 2015 2017 2019 FDP for TGT, to be submitted Q3 and Q4 Historical Brent respectively, in preparation for further Current Forward Curve Forward Curve Summer 2014 activities Dramatic oil price drop and increased uncertainty has caused SOCO’s partners to take a significantly more conservative approach to future spend and activity June 2015 │ 5
TGT Field Potential Large Areal Extent of TGT • TGT is a complex field with vast remaining potential • To realise full field potential requires: • Active reservoir management through additional water shut-offs and perforations • Facilities upgrade/debottlenecking Cross Section Through H1.1 Block • Further drilling TGT-3P TGT-16P TGT-2X TGT-7P TGT-1P TGT-15P TGT-5P TGT-2P West East TGT-18PST1 • ERCE study provides basis for analysing 5.2 Upper full range of activities to maximise field 5.2 Lower performance C TGT-H1-18PST1 TGT-H1-5P TGT-H1-1P A’ TGT-H1-2P TGT-H1-16P TGT-H1-3P TGT-2X TGT-H1-15P A TGT-H1-7P - Existing perforations - Suspended perforations H1 Platform - Planned future perforations TGT-1X TGT-H1-6P TGT-H1-4P June 2015 │ 6 TGT-H1-8P TGT-8X
SOCO Reserves and Contingent Resources Congo (4) MMboe TGT CNV Group SOCO WI Oil and Gas 2P Commercial Reserves (1)(2)(3) 1 January 2014 87.5 29.8 12.8 130.1 Production (4.2) (0.8) - (5.0) 2P Reserves, 31/12/2014 (pre revision and re-classification) 83.3 29.0 12.8 125.1 2P Commercial Reserves, 31 December 2014 36.5 4.3 - 40.8 SOCO WI Oil and Gas 2C Contingent Resources (1)(2)(3) 2C Contingent Resources, 31/12/2014 26.8 4.0 8.1 38.9 SOCO WI 2P Reserves & 2C Contingent Resources, 31/12/2014 63.3 8.3 8.1 79.7 (5) (5) Incremental 3P Reserves & 3C Contingent Resources, 31/12/2014 25.2 - - - SOCO WI 3P Reserves & 3C Contingent Resources, 31/12/2014 88.6 - - - Independent audit by Gaffney, Cline & Associates completed in June has confirmed above management’s estimates of Commercial Reserves and Contingent Resources for the Company’s Vietnam assets as of 31 December 2014 (6) (1) Commercial Reserves and Contingent Resources are categorised in line with 2007 SPE/WPC/AAPG/SPEE Petroleum Resource Management System (SPE PRMS). (2) Commercial Reserves and Contingent Resources are internal management estimates based on operator data and the ERCE study of TGT field resources including the Geological and Dynamic Simulation model. (3) Assumes oil equivalent conversion factor of 6000 scf/boe. (4) Congo volumes are associated with the Viodo discovery. (5) Based on the assessment of the range of STOIIP and the recovery factors in the Dynamic Simulation Model prepared by ERCE, additional volumes are being recognised as 3P Reserves and 3C Contingent Resources. (6) Gaffney, Cline & Associates independent audit confirmed TGT 2P Reserves and 2C Contingent Resources as presented; CNV 2P Reserves were audited as 4.5 MMBoe and 2C Contingent Resources as 3.8 MMBoe (both using a conversion factor of 6000 scf/boe). The aggregate of Gaffney, Cline & Associates CNV 2P Reserves and 2C Contingent is 8.3 MMboe as presented in the above table. June 2015 │ 7
TGT Production Profiles Underpinning Reserves and Contingent Resources 90 KBOPD SOCO Initiatives 80 KBOPD • ERCE study completed building a TGT 2C Full Development 240MMbbl Ultimate Recovery field wide model incorporating all data 70 KBOPD • Extensive two year process leading to new field simulation model 60 KBOPD • Detailed engineering work on a range of FPSO 50 KBOPD Significant Drilling options to accelerate production and Debottlenecking and Facilities Upgrade Requiring increase handling capacity 40 KBOPD Partner Alignment • Options tested for economics at a wide range of oil prices 30 KBOPD JOC Work 20 KBOPD • Updated RAR and FDP to be submitted 2P “Do Nothing” 160MMbbl Ultimate Recovery in Q3 and Q4 respectively 10 KBOPD • JOC working on costing of range of 0 KBOPD facilities options 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2P Reserves 2C Contingent June 2015 │ 8
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