Energy to deliver Peter Murdoch – Manager Contracts and Supply Chain 21/22 August 2013
Important notice and disclaimer Important information This Presentation has been prepared by Senex Energy Limited ( Senex ). It is current as at the date of this Presentation. It contains information in a summary form and should be read in conjunction with Senex’s other periodic and continuous disclosure announc ements to the Australian Securities Exchange ( ASX ) available at: www.asx.com.au. Risk and assumptions - An investment in Senex shares is subject to known and unknown risks, many of which are beyond the control of Senex. In considering an investment in Senex shares, investors should have regard to (amongst other things) the risks outlined in this presentation and in other disclosures and announcements made by Senex to the ASX. This presentation contains statements, opinions, projections, forecasts and other material, based on various assumptions. Those assumptions may or may not prove to be correct. No investment advice - The information contained in this presentation does not take into account the investment objectives, financial situation or particular needs of any recipient and is not financial advice or financial product advice. Before making an investment decision, recipients of this presentation should consider their own needs and situation, satisfy themselves as to the accuracy of all information contained herein and, if necessary, seek independent professional advice. Disclaimer - To the extent permitted by law, Senex, its directors, officers, employees, agents, advisers and any person named in this presentation: give no warranty, representation or guarantee as to the accuracy or likelihood of fulfilment of any assumptions upon which any part of this presentation is based or the accuracy, completeness or reliability of the information contained in this presentation; and accept no responsibility for any loss, claim, damages, costs or expenses arising out of, or in connection with, the information contained in this presentation. Reserve and resource estimates Unless otherwise indicated, the statements contained in this presentation about Senex’s reserves estimates have been compiled by Mr James Crowley BSc (Hons), who is General Manager – Exploration and Development, a full time employee of Senex, in accordance with the definitions and guidelines in the 2007 Petroleum Resources Management System approved by the Society of Petroleum Engineers (SPE PRMS). Mr Crowley consents to the inclusion of the estimates in the form and context in which they appear. Senex’s reserves and resour ces are consistent with the SPE PRMS. 2
Senex is a major player in the Cooper Basin South Australian Cooper Basin focus Proven onshore hydrocarbon province 65 permits 14 operated oil fields 38 joint ventures 72,301 km 2 net acreage 3
Our scorecard March 2012 July 2013 65,584 km 2 72,301 km 2 Permits People 52 170 Net profit after tax $1.9 million for 1H FY12 $23.5 million for 1H FY13 Oil Production 601,000 barrels for FY12 1.24 million barrels for FY13 Drilling program 11 wells 30+ wells 6.9 million barrels 1 2P reserves 10.8 million barrels Pipelines Proposed Complete and operational Gas Drilling first Cooper Basin gas Discovered Hornet gas field Activity well and basin centred gas play Nil 2C: 1.9 Tcf 3C: 5.5 Tcf Cooper Basin resources 13 mmboe (79 Bcf) 1 26 mmboe (157 Bcf) Surat Basin 2P reserves A$6-9/GJ A$8-11/GJ 2 2017 gas price estimate 1 As at 30 June 2011 2 Source: EnergyQuest 4
Cooper Basin Gas Business 5
Cooper Basin has strong Gas potentrial 6
Focused on commercialising Hornet… Program objectives so far: Gas to surface Resource definition Continual cost reduction Next steps : • Confirm project economics • Progress field appraisal and development plan Hornet contingent resources 1 Prospective resource 1,2 1C 2C 3C High Bcf mmboe Bcf mmboe Bcf mmboe Bcf mmboe 153 3 26 835 139 2,374 396 3,686 614 1 Estimated gross raw gas. 1,000 Bcf = 1 Tcf. 1 barrel of oil equivalent = 6,000 cubic feet 2 Prospective resource includes contingent resource. 3 100% share. Senex has entered into an agreement to acquire the 20% share of PEL 115 held by Orca Energy Limited – refer ASX announcement dated 13 June 2013 7
Cooper Basin oil business 8
Oil production underpins financial strength Track record for production and reserves growth: • More than 30 exploration, appraisal and development targets to be drilled in 2013/14 9
The Cooper Basin has a long history… The Cooper Basin has already produced 158 million barrels of oil 25 DECLINE STABILISATION REVITALISATION 1986 to 2000 2000 to 2011 2011 onwards 20 Estimated total Cooper Basin FY14 oil production mmbbls/year 15 10 5 0 10 Source: APPEA, DMITRE (South Australia) and Senex estimates
There is massive potential to “innovate”… Bringing old ideas to new areas and new ideas to old areas: • Fracture stimulation of both oil and gas reservoirs • Application of horizontal wells • Increase Well Density • Underbalanced and at-balance drilling • Drilling with casing • Patterned water-flooding • Increase use of 3D Seismic • Create open Market logistics hubs • And more… 11
Senex procurement and supply chain 12
Procurement and supply chain focus • Senex operates at the end of a very long supply chain • Mix of local and global – 400 suppliers and contractors • The Cooper Basin is very difficult logistically and operationally: – Unsealed / graded road system – Cargo and journey management are crucial – Safety, quality and planning are critical 13
Procurement and supply chain focus • Historically procured on short term / project basis • Going forward there will be increased focus on: − ‘ Calling- off’ goods or services from long term contracts − Increasing “standardisation” and “fit for purpose” solutions − Supporting infrastructure improvements in the Cooper Basin • Aim: − Increase economies of scale − Carry forward learning’s from project to project − Support growth of economically viable business − Strive for improved operational and EHQSS performance − Mitigate supply chain risk for both Senex and its vendors − Build sustainable supply chains both globally and locally 14
Procurement and supply chain – vendor registration • Vendor registration and pre-qualification with Senex will, in the near future, start via “Achilles” 15
Summary Oil is our strength • Production guidance for 2013/14: 1.4 million to 1.6 million barrels • Oil reserves growth guidance of 4 million to 6 million barrels 1 for 2013/14 • Material drilling program underway Gas is our game changer • Focus on early commercialisation of Hornet gas field Supply chain evolving • More longer term arrangements • Difficult logistics requiring improved infrastructure • “Achilles” the future conduit into Senex for new business 16 1 Before production and divestments
Questions 17
Registered Office Telephone Level 14, 144 Edward Street +61 7 3837 9900 GPO Box 2233 Email Brisbane Queensland 4000 Australia info@senexenergy.com.au
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