Investor Presentation April 2018
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. April 2018 | P1
2017 highlights 1 Comprehensive refinancing completed Previous maturities Revised maturities 2017 2018 2019 2020 2021 2022 3 Tolmount funding secured 400-800 mmbbls Zama 2 discovery, Mexico 4 First oil achieved from Catcher April 2018 | P2
2017 performance Production 5% 75 kboepd Opex 4% $16.4/boe Capex 58% $275m Reserves and resources 8% 902 mmboe Operating cash flow 15% $496m Net debt 2% $2,724m April 2018 | P3
The asset portfolio Largest 5 fields accounted for c. 70% of production in 2017 April 2018 | P4
Strategic framework, NAV focused • Priority in 2018/2019 Debt reduction • Targeting 2.5x EBITDAX by end Q1 2019 • Core operations in UKCS and Natuna Sea Producing – Maintain cost base of <$20/boe assets – Discretionary spend of $100m per annum • Continue to leverage FPSO expertise Develop- – Targeting >20% IRR at $65/bbl ment – Utilise leasing and other off balance sheet structures • Focus on proven but underexplored basins – Avoid high cost, deep-water areas Exploration – Minimise upfront commitments April 2018 | P5
Balanced capital allocation, returns driven 7 year capital allocation 2018-2024 Net operating Debt cash flow reduction 100% 30% Producing assets 20% New projects 40% Exploration 10% A sustainable position At $65/bbl • Positive free cash flow in all years to 2024 the business • Production > 100 kboepd at period end will deliver • Covenant level of <1x at period end April 2018 | P6
Portfolio overview
Asia production portfolio Chim Sáo (op, 53.125%) Natuna Sea Block A (op, 28.67%) Producing >30 kboepd • Active well intervention programme • GSA1 market share increasing • Ongoing reservoir optimisation • Improving gas price • Infill drilling opportunities • BIGP first gas 2019 • Crude sold at premium to Brent • Optimise exploitation of Lama gas Long life, low opex assets April 2018 | P8
UK production portfolio • Reserves • One of the Huntington (op, 100%) Elgin-Franklin (5.2%) upgrade UK’s largest • FPSO lease producing fields • Long field life extended • Cost reductions (COP 2035+) • Active well secured • Current intervention production programme • Exploration >10 kboepd UK upside production >50 kboepd • Lower opex 2019-22 • Targeting Solan (op, 100%) B Block (op, various) (manning deferral of COP project to 2021 • Continuing underway) • Infill drilling positive cash opportunities flow • Potential 3rd party business Tax advantaged cash flows April 2018 | P9
Catcher – the journey to first oil What we achieved in 2017 • FPSO hull and topsides completed and integrated • Sailaway of FPSO from Keppel yard • HSE Acceptance of Safety Case • Drilling and completion of 6 wells • Successful tie-in of wells and deployment of subsea control pods • Hook up of STP buoy to FPSO • Successful pull in of all risers, umbilicals and installation of swivel stack First Oil achieved 23 Dec 17 April 2018 | P10
2017 successful full cycle delivery of Catcher • Experienced project management team in delivery of FPSO projects On schedule • World class contractors Forecast total capex 30% below budget • Early operations involvement in project Plateau production • Collaborative and strong increased by 20% relationship with key contractors Industry leading • Deployment of industry leading outcome on HSE technology e.g. Geosteering • Experienced well delivery team • Subsurface design optimisation • Favourable market conditions April 2018 | P11
Catcher Area commissioning status Oil Booster Gas Gas lift 60 kbopd Dec Jan Feb Mar Apr treatment gas treatment and export 2018 2017 2018 2018 2018 production plant compression plant compression Operations 1.3 mmbbls • Good uptime; oil plant up and stable produced • Water injection commissioned since first oil • Catcher, Varadero on-stream • Burgman ready to produce Sold at a premium • Initial deliverability >60 kbopd to Brent • Peak rate performance test Q2 April 2018 | P12
Catcher Area upside Catcher North: • Potential for reserves upside Laverda: Joint development Tie-back via Varadero with Laverda – Conservative initial recovery factor assumed – Positive production test results – Well-connected sands with good pressure support – Reservoir quality and sand quantity above predictions made at sanction Varadero Infill • Infill drilling opportunities – 4D seismic acquisition FPSO targeted for 2019 Catcher Infill: • Tie-back of near field discoveries Multiple future Cromarty – Laverda, Catcher North and Tay targets identified Burgman Infill: Burgman Far East target Supported by seismic and well results April 2018 | P13
Tolmount – high value project Adds significant resource – 540 bcf Indicative production profile boe equivalent (100 mmboe) (kboepd) 60 Provides next phase of UK 50 growth – 50 kboepd peak production 40 30 Low capex requirement – $100m 20 (Premier’s share) 10 Low life of field total project cost – 0 $20/boe Tolmount Generates significant tax advantaged cash flows; >$1bn of net 48 km to terminal cash flow Holderness Potential Area Recovery of c. 1Tcf Inshore MCZ Holderness Offshore MCZ Onshore Terminal April 2018 | P14
Tolmount Main project update 2017 highlights • Key terms agreed for funding of Tolmount facilities • Draft Field Development Plan submitted to OGA • Project FEED nearing completion • Final negotiations with platform, pipeline and drilling contractors • Regulatory, environmental and planning statements submitted for public consultation • Targeting project sanction 2018 Infrastructure joint venture Tolmount Owners • Dana and CML will jointly own the platform and export pipeline Onshore Drillex terminal 25% • Tolmount gas will use the 26% facilities in return for production CAPEX Sources based tariff Owners 14% • Premier’s share of total capex SURF 19% Platform reduced to $100m 16% Infrastructure Owners April 2018 | P15
Tolmount Area Development Tolmount East • Subsea well tie-back • Sanction Tolmount Main • 220 Bcf • New 3D seismic over 2018 • Extends Tolmount Main plateau Greater Tolmount Area SW 42/28d-12 NE • Construction of platform, pipeline, onshore mods 2019 starts Gas water contact • Appraise Tolmount East Tolmount Tolmount East • 1 st development well on 2020 Tolmount Main • Exploration well on TFE Mongour • 3 development wells on 2021 Tolmount Main • Sanction Tolmount East Tolmount Far East (TFE) • 150 Bcf Tolmount Main • Subsea well tie-back • 1 st gas from Tolmount • NUI and 4 wells 2022 East development • 540 Bcf 3rd party opportunities • $100m (net) capex • Platypus April 2018 | P16
Sea Lion – substantial progress 1 2 World scale resource Proven development concept 160 • 1 bn bbls in new Annual average oil rate • Technically straightforward FPSO Phase 2 140 province Phase 1 development (similar to Catcher) 120 • Well understood • Extensive project development and (kbopd) 100 reservoir 80 engineering complete • Highly marketable 60 • Supply chain and logistics proven after 40 crude drilling campaign 20 0 0 5 10 15 20 Years from first production 3 World class contractor team • Experienced in comparable projects • Leveraging on past relationships and delivery of Catcher • Opportunity to lock in supply chain at competitive rates • Contractor interest aligned via provision of vendor financing 4 Key metrics Sea Lion Ph1 Catcher Regulatory interface well-advanced Development Plan FPSO+SPS FPSO+SPS • Environmental Impact FPSO oil capacity 85 60 Statement public consultation FPSO liquid capacity 120 125 process nearing completion Drill Centres 1-2 3 • FDP substantially agreed; final Total wells 23 19 update at sanction Producers 16 15 • Alignment with FIG on key Injectors 6 4 fiscal, commercial and Pre-first oil capex $1.5bn $1.3bn regulatory items Reserves/resource 220 96 April 2018 | P17
Sea Lion 2018 targets • Select preferred contractors and secure vendor financing – LOIs signed for c. $1.5 bn of total Owners Costs contracts value • Drilling rig • Well services Pre-first >$400m Oil capex • Subsea equipment of vendor Subsea Wells $1.5bn • Subsea installation loan notes services • Logistical support • Secure senior debt funding – Export credit agencies and project finance providers 25% 25% • Working towards year-end final 50% Upstream Vendor investment decision partnership financing Export credit / bank finance April 2018 | P18
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