Clean Energy For the MENA Region’s Tomorrow Dana Gas Investors Presentation March 2016 www.danagas.com 1
Forward Looking Statement Forward-looking statements are based on certain assumptions This presentation contains forward-looking statements and expectations of future events. The Company, its which may be identified by their use of words like “plans,” subsidiaries and its affiliates (the “Companies”) referred to in “expects,” “will,” “anticipates,” “believes,” “intends,” this presentation cannot guarantee that these assumptions “projects,” “estimates” or other words of similar meaning. All and expectations are accurate or will be realised. The actual statements that address expectations or projections about results, performance or achievements of the Companies, could the future, including, but not limited to, statements about the thus differ materially from those projected in any such forward- strategy for growth, product development, market position, looking statements. The Companies assume no responsibility expenditures, and financial results, are forward looking to publicly amend, modify or revise any forward looking statements. statements, on the basis of any subsequent developments, information or events, or otherwise . www.danagas.com 2
Presentation Outline Gas – Growth fuel in MENA Dana Gas – Overview Country Operations – Egypt and KRI Project Update – Zora Gas, UAE Credit Metrics Relative Valuations Summary www.danagas.com 3
Gas is the growth fuel of the 21 st Century. Gas has strong environmental credentials and is cost competitive Current full lifecycle costs for new-build power generation including CO2 emissions from fuel externalities (US$/boe) (% share of global emissions) Gas 20% Coal 44% Oil 36% Switching from coal to gas could reduce CO 2 emissions …and Air Pollution Rated Deaths by more than 50% by more than 12%... according to the IMF Assume: Europe coal US$62/tonne, NW Europe spot gas at price band of US$8-11/mln BTU, 80% load factor, €7.0/tCO2; uses IMF May 2015 estimates for coal and gas air pollution and GHG externality costs www.danagas.com 4 Source: Bloomberg, IMF
MENA region has strong economic growth credentials. Energy requirements of the region are expected to increase. Population growth in MENA countries 400 Bahrain 350 Qatar Kuwait 300 Population (millions) Oman 250 Libya UAE 200 Tunisia 150 Yemen Saudi Arabia 100 Iraq 50 Algeria Egypt 0 GDP growth in MENA countries (US$ billions, current prices) www.danagas.com 5 Source: UN Population Division, IMF
MENA gas demand is growing strongly. Dana Gas is well placed to be one of the region’s leading independent suppliers of this gas. 2000-14 MENA gas demand (bcm)* 600 Gas consumption (bcmpa) Other ME Gas demand growth 500 Kuwait (2000-2014 CAGR ) Algeria 400 Qatar China – 14.5% 300 Egypt MENA – 6.4% 200 UAE Saudi Arabia 100 US – 1% Iran 0 Gas use as share of total primary energy demand Supply demand balance of MENA overtime Middle East North Africa (Algeria + Egypt) Exported production Re‐exports Consumed Production Coal Hydro Other Other Hydro 800 1% 1% 0% 2% 1% 700 600 Gas balance, bcm pa 500 562 Oil 16.6 Oil 400 2.8 41% mmboe/d Gas 47% mmboe/d 300 51% 319 Gas 200 56% 100 158 92 0 2004 2014 www.danagas.com * Historical data for Tunisia and Libya unavailable 6 Sources: BP Stats, IEA
Dana Gas as regional gas integrated player focused on matching resource with markets Gas Resource* Holders in MENA (Total Reserves: c. 92 tcm) 40 Proved gas reserves, tcm Access to Private Capital Open 30 Potentially Open Closed/inaccessible 20 10 0 ^ Iran Qatar Iraq Saudi UAE Algeria Egypt Kuwait Libya Oman Syria Yemen Bahrain Arabia 2014 MENA gas demand by country. (Total Demand: c. 550 bcm pa) 180 2014 gas demand (bcmpa) 160 140 120 100 80 60 40 20 0 Iran Saudi UAE Egypt Qatar Algeria Oman Kuwait Bahrain Tunisia Libya Iraq Yemen Arabia www.danagas.com *60-70% of Middle Eastern gas resources are associated gas (IHS). ^ Iraq total includes KRI resource estimate 7 Source: BP Statistical Review 2014, BMI
Dana Gas – Business Profile www.danagas.com 8
Dana Gas: Independent E&P company listed on the ADX Dana Gas is operating at the heart of the world’s Dana Gas is a MENA focused gas independent largest hydrocarbon region headquartered in the UAE Quoted in the Abu Dhabi Securities Exchange. Bloomberg: DANA:UH Shares outstanding: c. 6969 million Market capitalisation: c. $ 911 million (on 16/02/2016) Enterprise value 1 : $ 1.292 billion Net Debt/(Cash) 2 : $ 379 million (2015 YE) Current Production: 63.9 kboepd (2015 YE) 2P Reserves 3 : 686 mmboe (2015 YE) Strong Corporate Governance and a unique pan- MENA Board of Directors access to business opportunities in the world’s largest hydrocarbon region www.danagas.com 1. Enterprise value includes $2mln of minority interests 9 3.Includes Egypt & UAE reserves at end of 2015 and Khor Mor field reserves based on Pearl Petroleum’s 2.Total interest bearing debt less cash estimate of 2P reserves based on production data
Dana Gas works across the gas value chain addressing both domestic and export market needs in MENA region Dana Gas is operating at the heart of the Production Profile world’s largest hydrocarbon bearing region CAGR 10.3% Business Model across the gas value Midstream and Net reserves & resources (YE 2015) chain – Meeting energy needs of Downstream assets in 2P reserves (Gaffney Cline & Associates 2015, Pearl Petroleum) domestic and export markets MENA Based on production EBGDCo – Liquid data from 1 of 12 Extraction plant (LPG) identified compartments in Khor UGTC & SajGas - Gas Mor (KM) field Transportation and Processing 35% in Crescent Natural Gas Corporation Limited (CNGCL) – Gas marketing www.danagas.com 10 *Includes 700bpd from EBGDCO (LPG plant) **In addition to the KM 2P reserves identified by Pearl Petroleum (PPCL) based on current production, PPCL also estimates total risked in place resource volumes (P50) of 75tcf of gas and 7bn bbl of oil in KM and Chemchemal fields
Consistent production growth, delivery and financial performance since 2007 Revenue Production CAGR: 5% CAGR: 10.3% Profit After Tax CAGR: 21.6% www.danagas.com 11 *Includes 700bpd from EBGDCO (LPG plant)
Dana Gas: Country Business Highlights EGYPT www.danagas.com 12
Egypt gas market fundamental are sound. New gas discoveries and gas imports are likely to return Egypt’s domestic demand to its historic growth trajectory Egypt annual gas supply/demand balance (post Zohr) Egypt’s current and planned regas capacity (Source: Woodmac) (Source: company data, Interfax) Producing Sanctioned Projects LNG Exports LNG Imports Probable Projects Zohr Demand 70 Forecast 60 50 Gas Supply, bcm 40 30 20 10 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 www.danagas.com 13
Dana Gas is the 6th largest operator and 5th largest onshore producer in Egypt 2016e Gas Production Ranking in Egypt (Source: Woodmac) (* denotes company is an operator) 1,800 2016 WI Production, mmcfpd Mainly onshore production 1,600 1,400 Mainly offshore production Dana Gas Egypt Credentials: 8 th largest producer 1,200 6 th largest operator 1,000 5 th largest onshore producer 800 600 400 200 0 EBGDCO LPG Plant Gas Reserve Ranking of Independents in Egypt (Dana Gas holds 26.4% of the project) (Source: Dana Gas, Woodmac) 800 Gas resources, bcf 600 400 200 0 www.danagas.com 14 1.Edison holds 100% operating interest in Abu Qir, but the development is operated by a 50:50 JV with EGPC – Edison not designated as operator 2. Dana Gas reserves based on 2015 year end reserve estimate
Egypt: Nile Delta Operations El Wastani Development Leases: • Onshore acreage consisting of 14 Development Leases in the prolific Nile Delta region Production: • 4Q 2015 avg 32.2 kboe/d versus 37.6 kboe/d for 4Q 2014. Decline in production followed a steady and predictable downward curve associated Balsam 3 Balsam 2 with normal field decline which was partially reversed when Balsam field production and well completions were brought on stream in 4Q 2015. Operations: Begonia DL • Post Balsam-2 and Balsam-3 completions, SD-4, SF-5 and SAEN-7 wells were successfully completed in South El 4Q 2015. Manzala • SF-5 has hit KES pay with 2 new accumulations named Roaa and Anes. SAEN-7 proved a separate compartment with deeper gas water contact. www.danagas.com 15 * Excluding EBGDCO share of Production
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