Trinidad Presentation January 2015 Company Presentation January 2015 1
Forward Looking Statement Certain information in this document is forward-looking and is subject to important risks and uncertainties. The results or events predicted in this information may differ from actual results or events. Factors which could cause actual results or events to differ materially from current expectations include, among other things, the ability of Range Resources Limited to successfully implement its strategic initiatives and whether such strategic initiatives will yield the expected benefits, the availability and price of energy commodities, regulatory environment, competitive factors in the oil and gas industry and the prevailing economic conditions in Trinidad and Tobago. Range Resources Limited disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Company Presentation January 2015 2
Company Overview The assets • Trinidad onshore is a fundamentally strong business, that has Range Resources is a suffered from years of underinvestment • Solid reserve base, certified 1P of 19 mmbo in well-known, dual listed (ASX: RRS; easy-to-access reservoirs AIM; RRL) Trinidad- • Low-risk waterflood projects, combined with extensive low-cost shallow onshore development drilling programme focused independent • Well-developed field infrastructure and off-take facilities, E&P company capacity in place for drilling programme Access to funding and strong strategic partnerships • Integrated Master Services Agreement in place with oilfield services partner LandOcean Range’s CEO Mr Yan Liu visiting Trinidad operations • US$60 million equity based financing secured from Core Capital to strengthen Range’s balance sheet (subject to shareholder approval) • US$50 million credit facility arranged with Sinosure for Trinidad Beach Marcelle, Morne Diablo and South Quarry waterflood programmes • Range will fully exploit and develop the potential of the Trinidad assets with the US$110 million total financing package The management • All Range staff are focused on stabilising and turning around the Company • The management is confident that it has all the right elements in place to deliver growth and shareholder value in 2015 • Strong operational team with over 20 years experience in Trinidad Company Presentation January 2015 3
Our Vision Today The 3 to 5 year vision • • Extensive acreage position in world class petroleum Leading Trinidad focused mid-cap E&P province Company • • Solid reserve base in Trinidad, certified 1P of 19 Significant oil production and reserves growth mmbo in well-known, easy-to-access reservoirs • Value growth through a portfolio of secondary • Focus on production growth from core assets in recovery projects, exploration and infill drilling Trinidad • Continue to evolve through strong strategic • Majority of current production which ranges between partnerships 500-600 bopd comes from infill drilling • Strong balance sheet • Access to sizeable drilling fleet (rig fleet undergoing • Enhanced cash generation and returns to improvement) shareholders • Strong support from strategic partnership with • Balanced shareholder mix of institutional and LandOcean retail holders • Capabilities – strong senior management team • Pursue growth opportunities in line with supported by experienced Board of Directors, regional focus focused on delivery and production growth • Balanced risk profile • Divesting non-core assets Company Presentation January 2015 4 4
Strong Strategic Partners Range’s strong strategic Prime Minister Kamla Persad-Bissessar with Ambassador Singh, and China’s vice -minister of Foreign Affairs, Xie Chinese partnerships Hangsheng, cut the ribbon to signal the opening of T&T’s embassy in Beijing, China (February, 2014) provide access to sophisticated services as well as financial backing • Oilfield Services Partner: LandOcean Energy Services Co., Ltd (IMSA in place) • Funding Partners: Abraham Ltd – sophisticated long-term investor (14% shareholder) • Additional Financial Backing: US$60 million equity based financing secured from Core Capital to strengthen Range’s balance sheet (subject to shareholder approval); US$50 million credit facility arranged with Sinosure for Trinidad waterflood programmes • Trade between China and Trinidad and Tobago has been growing, with figures from Chinese President Xi Jinping visiting Trinidad and Tobago the International Monetary Fund suggesting it has gone up from $174m to $450m (2013) over the last six years “ We both agree to actively advance cooperation in key areas of energy, minerals and infrastructure development and also to advance our cooperation in new energy, telecommunications and agriculture ,” Chinese President Xi Jinping said after meeting Prime Minister Kamla Persad-Bissessar. Mrs Kamla Persad-Bissessar said her country sees China “ as a key business partner and potential new market for our energy products.” “We have to adopt policies, principles and procedures to operate in a way that will not deny T&T from the benefits that can accrue from an incredible country like China,” T&T’s ambassador to China, Chandradath Singh said during the opening of the first T&T embassy in Beijing in 2014. Company Presentation January 2015 5 5
Strategic Partner – LandOcean LandOcean Energy Services • LandOcean is one of the largest oil and gas services companies in China, listed in Shenzhen with market cap c.US$ 1.4 billion • Headquartered in Beijing with c.2,000 employees • LandOcean provides a wide variety of services across the upstream development cycle, from frontier geological studies through to engineering and procurement for development and production projects • Range is very pleased to have LandOcean as a highly capable and technically sophisticated preferred services provider Strategic partnership provides access to sophisticated oilfield services as well as additional financial backing • In June 2014, Range entered into an Integrated Master Services Agreement with LandOcean • In December 2014, Range has entered into the second purchase order, for the provision of technical services by LandOcean to implement waterflooding plans in Trinidad, including reservoir geology, reservoir engineering, drilling engineering, production engineering, surface facilities engineering and economic evaluation • Funding for the waterflood projects has been arranged through US$50 million credit facility with Sinosure Company Presentation January 2015 6
Production Growth in Trinidad Driven by Three Projects 1. Secondary recovery – waterflood • Range and LandOcean are finalising proposed plans for extended Range’s assets locations in Trinidad waterflooding of Range’s Trinidad Beach Marcelle, South Quarry, Morne Diablo licences with subsurface studies successfully completed • Majority of production growth to come from waterflood programme centred on Beach Marcelle • 73% (14 mmbo ) of Range’s 1P Reserve base is found in Beach Marcelle • Waterflood is a common and technically proven secondary oil recovery technique • Existing wells and infrastructure will be utilised where possible • The Company will also implement the Morne Diablo Shallow Forest waterflood – successful pilot programme already completed 2. Development drilling • Range is the largest Shallow drilling in well known reservoirs with quick development from spud to production private onshore acreage • Historical underinvestment has hindered rig upgrade, maintenance and efficient drilling operations holder in Trinidad • Focus now is on improving operational efficiency, and sub-surface evaluation to reduce risk and increase reward and has an extensive network of partners across the country’s oil & gas industry 3. Large prospective exploration acreage • Exploration of the deeper potential of the existing licences • Exciting exploration activity on Guayaguayare and newly awarded St Mary’s licences Company Presentation January 2015 7
Waterflood Programme and Technology Current s tatus of Range’s waterflood programmes • Range and LandOcean are finalising proposed plans for extended waterflooding of Range’s Trinidad licences, with subsurface studies successfully completed • Funding for the waterflood projects has been arranged through US$50 Waterflood Technology million credit facility with Sinosure • Dr. Wang Guohui, a deputy General Manager of LandOcean with over 25 years of experience in oilfield production analysis and management has been appointed as LandOcean’s Head of Trinidad project to complement Range’s Trinidad team Waterflood technology • Most fields in Trinidad have been traditionally produced by “primary recovery”, which uses the solution gas dissolved in the oil to provide the driving force to produce the oil to surface • This is a cost effective way to produce initial oil, but recovers only about 15% of the oil-in-place – 85% of the oil remains in the reservoir • Waterflooding can recover at least a further 15% of the oil-in-place Analogues (Primary then waterflood recovery) • Texaco used this technique successfully in parts of the Beach Marcelle field in the1950s/1960s • The technique has been used in many onshore fields in regions with a long history of oil production, such as USA, Middle East, China, Latin America Company Presentation January 2015 8
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