INVESTOR PRESENTATION 9M AND 3Q 2018 30 November 2018
DISCLAIMER This presentation (hereinafter – the “Presentation”) of the Alliance Oil Company (hereinafter – the “AOC”) was prepared exclusively for the information purposes in order to improve the transparency of disclosure of relevant information and materials of AOC and establish a continuous dialogue with investors. The data contained in this Presentation constitutes the confidential information of the AOC group of companies and shall not be disclosed or transmitted to any third parties without the prior written consent of the disclosing party. The information contained in this Presentation was prepared and provided by the AOC structural departments. These data can be changed with the course of time and are subject to regular update and amendment. This presentation is not an offer or solicitation of an offer and does not cause creation of any rights or obligations from the AOC and/or potential partners to carry out transactions or to enter into negotiations on cooperation. The information provided in this Presentation is not an offer or proposition to conclude an agreement. AOC makes no warranty in respect of the accuracy or reliability of the information contained in the Presentation and accepts no liability for any losses suffered by third parties arising from inaccuracy or unreliability of such information as well as for other negative effects. 2
Operating Environment On 1 June 2017 the Office of Foreign Assets Control of U.S. Department of the Treasury (“OFAC”) included AO Nezavisimaya Neftegazovaya Kompaniya and AO NNK-Primornefteproduct, subsidiaries of the Group, to the Specially Designated Nationals and Blocked Persons list (“SDN List”). Sanctions were imposed pursuant to the US President Executive Order No. 13722 of 15 March 2016, concerning blocking the property of the Government of North Korea and the Workers’ party of Korea, and prohibiting certain transactions with North Korea. The Group cooperates with OFAC on all arising matters. The Group has received a confirmation from The Bank of New York Mellon of the current absence of obstacles for the provision of services and payments settlement under the Group’s existing Eurobonds. As of now there are no further developments that the Group is able to report. Information will be updated accordingly. 3
9M 2018 Market Environment Crude Oil Prices and Exchange Rate RUB/USD USD/bbl Oil Products Price USD/bbl 100 120,00 80 110,00 70 80 100,00 90,00 60 80,00 60 70,00 50 60,00 40 40 50,00 40,00 20 30 30,00 20,00 20 0 Naphtha Diesel Fuel (Gasoil 500 ppm) Fuel oil (HSFO 180) Brent Exchange rate 9M 2018 9M 2017 9M 2018 9M 2017 Indicator % Indicator % average average average average Brent, USD/bbl 72.08 51.93 +39% Naphtha, USD/bbl 68.97 50.99 +35% Exchange rate, USD/RUB 61.44 58.33 +5% Diesel fuel, USD/bbl 84.57 63.45 +33% Fuel oil, USD/bbl 62.35 46.24 +35% 9M 2018 results were positively affected by higher crude oil and oil products quotes, with a negative impact on downstream segment from increased prices of crude oil purchased for refining 4
HIGHLIGHTS FOR 9M 2018 AND 3Q 2018 Indicator 9M 2018 9M 2017 3Q 2018 3Q 017 Comments Financial Results Increase primarily due to higher crude oil and 2,809 2,139 1,037 787 Revenue, MUSD oil products prices Increased profitability of upstream segment (9M)/Decreased profitability of downstream 314 EBITDA, MUSD 312 118 150 segment due to increase in the cost of crude oil purchased for refining (3Q) Net loss primarily resulted from the allowance (217) 42 (14) 56 Net Result, MUSD for deferred tax assets and FX loss 60 Adjusted Result 1 , MUSD (6) 33 27 Increased profitability of upstream segment Operational Results Decrease in capital expenditures in 2016-2017 11.9 13.4 4.0 4.4 Production, mboe due to negative macro parameters Increase due to resolved logistical bottleneck 27.0 25.6 10.0 9.7 Refining volumes, mbbl of oil products delivery Increase due to resolved logistical bottleneck 26.5 24.8 9.7 9.4 Throughput, mbbl of oil products delivery 1 Adjusted Result is defined as the Group’s Net Result adjusted for non -cash items such as foreign currency exchange gain/(loss), modification loss on loans, allowance for deferred tax assets and other significant one-off items in profit or loss. 5
UPSTREAM OPERATIONS Crude Oil and Gas Reserves and Production Timano-Pechora 9M 2018 production: 3.0 mboe (26%) 1 3Q 2018 production: 1.1 mboe (27%) Volga-Urals and Kazakhstan Tomsk 9M 2018 production: 9M 2018 production: 6.0 mboe (51%) 2.8 mboe (23%) 3Q 2018 production: 3Q 2018 production: 2.0 mboe (50%) 0.9 mboe (23%) Alliance Oil Company, consolidated 2P oil reserves: 551.5 mboe 2 2P gas reserves: 46.9 mboe 9M 2018 production: 11.9 mboe (average daily: 43,260 boepd ) 3Q 2018 production: 4.0 mboe (average daily: 42,971 boepd ) Notes : (1) Percentage in consolidated Alliance Oil Company production. (2) As per DeGolyer & MacNaughton as of 31 December 2017. 6
UPSTREAM OPERATIONS Crude Oil and Gas Production Hydrocarbon Production, boepd Hydrocarbon Production, mboe 55 000 5,0 4,4 4,5 4,2 4,0 3,9 4,0 52 000 4,0 3,5 48 354 49 000 3,0 2,5 46 153 46 000 2,0 44 388 1,5 42 971 42 912 43 000 1,0 0,5 40 000 0,0 3Q 2017 4Q 2017 1Q 2018 2Q 2018 3Q 2018 3Q 2017 4Q 2017 1Q 2018 2Q 2018 3Q 2018 Implemented 96 well interventions, launched 41 new wells in 9M 2018 Due to successful interventions oil production has stabilized. Previous decrease in production explained by minimal capital expenditures in 2016-2017 due to negative macro parameters The Group has USD 168 mln of capital commitments for Upstream segment capital construction. The Group expects to further improve its production trend 7
UPSTREAM OPERATIONS Crude Oil Sales Crude Oil Sales, mbbl Export Domestic Produced Domestic Re-sold Export Domestic Produced Domestic Re-sold 16 6 14,4 5,3 13,5 14 5 4,7 1,7 3,9 12 1,8 0,7 4 10 5,2 8 3 1,9 5,3 1,8 6 2 4 6,6 2,1 1 5,2 1,7 2 0 0 9M 2017 9M 2018 3Q 2017 3Q 2018 Increase due to trading in crude oil purchased from third parties, the Group's market position allows to secure favorable trading margin 8
UPSTREAM OPERATIONS Crude Oil Netbacks Crude Oil Netback Prices, USD/bbl Export Domestic Export Domestic 70 70 58,7 60 60 52,8 53,0 47,3 52,6 46,7 50 50 40,0 52,2 37,8 50,1 44,8 40 43,9 40 30 30 27,0 20 20 23,8 10 10 0 0 9M 2017 9M 2018 3Q 2017 4Q 2017 1Q 2018 2Q 2018 3Q 2018 Netbacks in all destinations fluctuated roughly in line with crude oil prices Notes: The netback prices are calculated by deducting VAT, railway and pipeline transportation costs (for Russian domestic sales) or transportation, export duty, brokers’ commission and certain other costs (for export sales). 9
UPSTREAM OPERATIONS Gas Sales and Price Gas and Gas Liquids Sales, kboe Gas and Gas Liquids Prices, USD/boe 1 400 60 1 214 48,0 1 200 50 42,5 916 1 000 40 800 30 600 20 400 8,2 7,9 181 148 10 200 0 0 9M 2017 9M 2018 9M 2017 9M 2018 Gas net price, USD/boe Gas Liquids net price, USD/boe Sold volume of gas, kboe Sold volume of gas liqids, kboe 60 56,5 400 376 46,6 350 50 42,6 279 42,9 300 40 41,9 250 30 200 150 20 100 56 47 8,4 8,7 7,6 7,5 10 50 8,3 0 0 3Q 2017 3Q 2018 3Q 2017 4Q 2017 1Q 2018 2Q 2018 3Q 2018 Gas and gas liquids prices fluctuated in line with RUB/USD exchange rate and market demand 10 Notes: The net prices are calculated by deducting VAT.
UPSTREAM OPERATIONS Crude Oil and Gas Sales Revenue from Sales of Crude Oil, Gas and Gas Liquids, MUSD Export Domestic Produced Domestic Re-sold Export Domestic Produced Domestic Re-sold 292 300 781 800 700 250 212 99 600 541 194 200 68 500 30 272 150 400 95 195 71 300 100 200 297 278 50 98 93 100 0 0 3Q 2017 3Q 2018 9M 2017 9M 2018 Revenue increased primarily due to more favorable netbacks in both destinations and trading in crude oil purchased from third parties 11
DOWNSTREAM OPERATIONS Assets and Refining volumes Kamchatka region Retail gas stations: 18 Marine terminals: 1 Jet fuel depot: 1 Far East: Amur, Primor and Khabarovsk regions TOTAL Retail gas stations: 248 Operating retail gas stations: 280 Oil depots: 20 (including 8 oil Oil depots: 20 (including 8 oil depots conserved) Marine terminals: 2 depots conserved) Marine terminals: 3 Railway tankers: 1,451 Jet fuel depot: 1 Railway tankers: 1,451 The Republic of Buryatia Khabarovsk Oil Refinery Retail gas stations: 14 Refining volumes: 9M 2018: 99,071 bopd (9M 2017: 93,748 bopd ) 3Q 2018: 108,230 bopd (3Q 2017: 105,380 bopd ) Throughput: 9M 2018: 26.5 mbbl (9M 2017: 24.8 mbbl ) 3Q 2018: 9.7 mbbl (3Q 2017: 9.4 mbbl ) 12
DOWNSTREAM OPERATIONS Khabarovsk Oil Refinery Refining volumes, bopd Light oil products yield,% 9M 2018 9M 2018 62,5% 99 071 9M 2017 9M 2017 62,9% 93 748 3Q 2018 108 230 3Q 2018 60,9% 3Q 2017 105 380 3Q 2017 64,3% Oil Products Breakdown in 9M 2018, % Refining throughput, mbbl 9M 2018 26,5 6% 9M 2017 24,8 Fuel oil 34% 21% Marine fuel 3Q 2018 9,7 Gasoline 9,4 3Q 2017 Diesel fuel 20% 19% Others 13
Recommend
More recommend
