The Bangchak Petroleum PLC Analyst Meeting Q3/2015 November 12, 2015
AGENDA 1 Quarterly Summary 2 Oil Market Outlook 3 Financial Performance Update 4 Investment Update 2
AGENDA 1 Quarterly Summary 2 Oil Market Outlook 3 Financial Performance Update 4 Investment Update 3
Quarterly Highlight – Running smooth at new historical high crude run How do we determine our crude run rate? Running smooth Variable Cost/Unit Above 100 KBD for 12 months Crude E Max Run Crude D Crude run Historical High Unit: KBD Previous Crude C High 118 117 117 115 112 109 102 Crude B 97 Q3/14 Q4/14 Q1/15 Q2/15 Jul Aug Sep Q3/15 Crude A Above 120 KBD for more than 20 days during the quarter GRM Shut Down 4
Quarterly Summary - Performance was right on track and improved from last year Performance Review +51% YoY (Unit: THB Million) 10,472 9,681 721 498 100% 515 242 92% 2,776 6,418 2,140 E&P 204 Biofuel 1,948 1,832 2,417 Solar Power 1,929 • Zero Unplanned Shutdown Marketing 4,967 4,209 • Strong Market GRM 2,654 Refinery (12) 9M/14 9M/15 Target FY15 Accounting EBITDA Accounting EBITDA Smooth & satisfied return from refining contributed to superior performance EBITDA from refinery was very satisfied compared to FY2015 target from the result of strong market GRM since the beginning of the year 5
Quarterly Summary – Refinery ran smoothly at high rate and a slightly contracted overall sales volume from seasonal factors Crude run Total Sales Volume Unit: KBD Unit: KBD Record High 121 123 124 117 113 112 Plan level 109 27 29 34 105-110 KBD 30 97 94 97 87 83 Q3/14 Q1/15 Q2/15 Q3/15 Q3/14 Q1/15 Q2/15 Q3/15 Other Channels Marketing Sales Volume Running Smooth Seasonality affected volume sold without any interruption The result of new and improved refining Marketing Business is always our priorities technologies from last year turnaround maintenance YoY – Demand improved from retail price drop An ability to boost up crude run to capture window of opportunities (high GRM) 6
Refinery Performance – Running smooth with stable feedstock Crude Sourcing Product Yield Unit: KBD LPG 2% 3% 3% 2% 117 112 109 Gasoline 20% 19% 20% 20% 97 Jet 10% 10% 12% 11% 69 56 65 42 Import 49% 53% 50% Diesel 54% Domestic 54 52 47 48 1% UCO 18% 16% 14% 13% Fuel Oil Q3/14 Q1/15 Q2/15 Q3/15 Q3/14 Q1/15 Q2/15 Q3/15 Stable Feed No Unplanned Shutdown The marginal crude run were supplied by New a value added product for more diversities imported crude - Unconverted Oil (UCO) for lube feedstock 7
Refinery Performance – Soften Market GRM from diesel spread GRM Performance Unit: $/BBL DTD/DB ($/BBL) Accounting GRM 2.66 4.26 11.90 4.07 3 2 1.48 1 0 Market GRM started to normalize 10.41 10.19 7.90 6.94 QoQ - Soften Market GRM from Crack Spreads ($/BBL) weakening spreads, a hedging loss of THB 44 Million and an inventory loss 30 UNL95/DB -3.84 of THB 1,415 Million. -4.28 -5.93 20 10 YoY - Improved Market GRM from GO/DB 0 strong UNL95 spreads. Q3/14 Q1/15 Q2/15 Q3/15 0 FO/DB Hedging + Inventory Gain/Loss -5 -10 Market GRM 8
BCP Trading Channels – Retail customer is our priority Q3/15 YoY Q3/14 Marketing Business Unit: ML 46 % Retail : Service Station >1,000 Service Station 746 803 8% Nationwide Under brand “ Bangchak ” 30 % Industrial Customer 475 469 -1% Factories, Jobbers, and Aviation Customer 9 % 149 158 6% Other Oil Companies Export 283 342 21% 15 % FUEL Fuel Oil exported OIL 1,654 1,773 7% Total Sales Volume as of 9M2015 : 5,326 ML 9
Marketing Performance – Total sales volume continued to expand from last year Marketing Sales Volume Net MKM Margin Unit: Million Litre Unit: THB/Litre Total 0.75 0.71 1,404 0.70 0.69 MKM +4% YoY 1,344 1,272 1,221 555 0.48 562 0.29 0.43 475 469 -1% YoY 0.24 -17% YoY 0.98 849 +8% YoY 0.97 -1% YoY 0.95 803 782 746 0.87 Q3/14 Q1/15 Q2/15 Q3/15 Q3/14 Q1/15 Q2/15 Q3/15 Retail Market Industrial Market Retail Margin Industrial Margin Seasonal factor affected volume sold while demand increased consumption Demand improved from retail price drop 10
Marketing Performance – Maintain 2 nd rank market share Retail Sales Volume (Million Litre/ Month) Thruput per station (K.litre/Station/Month) 300 FY2015 600 280 FY2014 260 FY2013 Major oil excluding BCP 240 500 FY2012 220 200 400 180 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC BCP Standard Type 300 Market Share (Retail Channels) 5.3% 1.4% 1.4%0.2% 200 6.0% 6.9% 37.0% 100 13.0% BCP Co-Op Type 13.8% 15.0% nd Rank 0 2 Jan- Sep 2015 11
Solar Power Plant – Contributing stable income Seasonality factor (Rainy season) caused Steady steam of cash flow Electricity Sales (Million kWh) electricity generation to come down 56 Q3/14 Tropical Rainstorm Vamco 63 Target 72 Q1/15 65 62 Q2/15 Actual 68 56 Q3/15 +1% YoY 64 10 15 5 4 5 6 7 4 5 6 7 Phase 3 Phase 2 Phase 1 Jan-14 Jan-14 Jan-14 Electricity sales by phase (Million kWh) Feb-14 Feb-14 Feb-14 Mar-14 Mar-14 Mar-14 Apr-14 Apr-14 Apr-14 May-14 May-14 May-14 Jun-14 Jun-14 Jun-14 Jul-14 Jul-14 Jul-14 Aug-14 Aug-14 Aug-14 Sep-14 Sep-14 Sep-14 Oct-14 Oct-14 Oct-14 Nov-14 Nov-14 Nov-14 Target Dec-14 Dec-14 Dec-14 Jan-15 Jan-15 Jan-15 Feb-15 Feb-15 Feb-15 Mar-15 Mar-15 Mar-15 Apr-15 Apr-15 Apr-15 Actual May-15 May-15 May-15 Jun-15 Jun-15 Jun-15 Jul-15 Jul-15 Jul-15 Aug-15 Aug-15 Aug-15 Sep-15 Sep-15 Sep-15 12
Biofuel – Demand return to normal : B100 mixing with diesel of 7% Daily Production and Sales Volume (K. Litre per day) +9% YoY 582 568 522 405 371 364 366 355 Q3/14 Q1/15 Q2/15 Q3/15 Daily Production Sales Volume Demand increased as government increased mixing mandate YoY - Government’s policy of increasing the portion of B100 mixing with diesel from 3.5% to 7% 13
E&P – Contingent resource estimated for the mid-Galoc was released by Gaffney Cline and Associates Performance Review Production uptime for Galoc Field was 100% • Production (KBD) 6.51 6.40 6.11 3.58 3.41 2.50 Gross Production Net to NIDO Q1/15 Q2/15 Q3/15 Contingent Resource Volumes lifted and Sold (bbls) Estimate for mid-Galoc 396,793 277,165 200,998 The independent assessment completed by Gaffney Cline & Associates estimates the mid-Galoc area of the field Contingent Resources on a gross basis as at Q1/15 Q2/15 Q3/15 30 June 2015 as 2 Cargoes 2 Cargoes 1 Cargo • 1C = 6.2 mmstb (3.4 mmstb) Cargo 43 Cargo 45 Cargo 47 • 2C = 9.5 mmstb (5.3 mmstb) 60.16 $/BBL 60.62 $/BBL 49.84 $/BBL Cargo 44 Cargo 46 54.44 $/BBL 62.98 $/BBL All prices are on FOB realized basis 14
AGENDA 1 Quarterly Summary 2 Oil Market Outlook 3 Financial Performance Update 4 Investment Update 15
Oil glut to persist but slower excess supplied could seen in 2H/16 Global Oil Balance 2014 - 2016 95.72 +1.20 94.52 +1.77 92.75 Call on Call on 29.70 MBD 31.13 MBD 30.28 OPEC OPEC 6.56 6.82 6.36 -0.51 58.28 57.77 57.04 +1.24 2014 2015 2016 Non-OPEC Supply OPEC(NGLs) OPEC Production Total Demand Oil glut to persist as global demand growth slows Non-OPEC supply growth disappearing fast on low prices OPEC still pumps oil at around 31.5 MBD while Iran is keen to recover the market share by next year In Q4/2016, OPEC would need to pump almost 32 MBD - the first time the world would require more oil OPEC currently produces 16
Crude Oil Prices Outlook - Market rebalancing and price recovery will be limited Russia Ukraine crisis ISIS sudden Crude Oil Prices Movement attack in Iraq $/BBL Outlook 120 110 100 Oil rig count Iran nuclear 90 dropped / Inventories OPEC decided deal reach U.S. election Upstream Iran resume declined 80 against investment Refinery export output cut 70 cut maintenance 60 WTI Brent 50 China’s 40 Dubai Dubai Outlook stock rout 30 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Q1/14 Q2 Q3 Q4 Q1/15 Q2 Q3 Q4 Q1/16 Q2 Q3 Q4 Dubai Avg Dubai Avg Q3/15 = 50.0 2016(F) = 55.0 $/BBL Q4/15(F) = 49.0 2015(F) = 53.0 $/BBL Q4/15 2016 • Higher oil demand during winter • Slower non-OPEC supplies (Warmer winter?) • China buying for SPR filling • Refineries return from maintenance • On going unrest in MENA • Stronger U.S. dollar outlook to pressure oil prices • Oil inventories build up moved from crude to products • No signal for policy change in OPEC meeting in Dec • Iran to resume oil export • FOMC Meeting focus on interest rate hike • Weak Chinese economy • Chinese economic slowdown 17
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