Vantage Drilling International Investor Presentation February 2016
Forward-Looking Statements Some of the statements in this presentation constitute forward-looking statements. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. The forward looking statements contained in this presentation involve risks and uncertainties as well as statements as to: • our limited operating history; • availability of investment opportunities; • general volatility of the market price of our securities; • changes in our business strategy; • our ability to consummate an appropriate investment opportunity within given time constraints; • availability of qualified personnel; • changes in our industry, interest rates, the debt securities markets or the general economy; • changes in governmental, tax and environmental regulations and similar matters; • changes in generally accepted accounting principles by standard-setting bodies; and • the degree and nature of our competition. The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to us or are within our control. If a change occurs, our business, financial condition, liquidity and results of operations may vary materially from those expressed in our forward-looking statements. 2
Strategic Overview Vantage was founded with a vision of bringing the best Experienced people together with the highest People specification, modern fleet in the offshore drilling industry. High Financial Specification Structure Assets Long-term Customer Relationships 3
People Our senior management team averages over 30 years of industry experience. The cornerstone of our corporate culture are safety and professionalism. • Industry leading safety record - lost time incident rate in 2015, 2014 and 2013 was .08, .35 and .32, respectively. • Exceptional Technical Team – our technical and operating experience has resulted in Vantage being selected to manage 3 rd party shipyard projects and operations. 4
Premium Fleet - Proven Track Record Emerald Driller Topaz Driller Sapphire Driller Aquamarine Driller Delivered On ‐ Time, Delivered On ‐ Time, Delivered On ‐ Time, Delivered On ‐ Time, On ‐ Budget ‐ December 2008 On ‐ Budget – December 2009 On ‐ Budget ‐ July 2009 On ‐ Budget – September 2009 Tungsten Explorer Titanium Explorer Platinum Explorer 3 rd Successful newbuild at DSME 2 nd Successful newbuild at DSME Delivered On ‐ Time, On ‐ Budget – November 2010 Delivered April 2012 Delivered On ‐ Budget – July 2013 5
Fleet Status 2015 2016 2017 2018 Rig Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Jackups Emerald Driller Sapphire Driller Aquamarine Driller Topaz Driller Drillships Platinum Explorer Titanium Explorer Tungsten Explorer Contracted Option Letter of Award; Commisioning / Stacked Contract subject to conditions Mobilization 6
Customer Focus We have focused our marketing efforts on customers with long-term drilling requirements with the opportunity for long-term contracts. 7
Financial • Pro-active Capital Restructuring Plan – Eliminates $1.5 billion of debt with little near-term maturity – Dramatically reduces debt service (≈90%) • Pro-active cost management and workforce rationalization. • Amended and extended Tungsten Explorer contract with Total adding an additional two years of backlog. • New eighteen month contract for Aquamarine Driller with CPOC. 8
Debt Summary Principal Outstanding Debt Service Third Lien Convertible Notes (in millions) Credit Agreement: do not require any cash debt $32.0 million Letter of Credit Facility $ - $ - service prior to maturity. bears interest @ 5.5% These notes are convertible at $ 143.0 $ 10.0 2019 1st Lien Term Loan Facility Interest the option of the holders for 3 $ 1.4 matures December 31, 2019, Amortization years. Thereafter, they are bears interest @ Libor + 6.5% $ 11.4 convertible at the option of 10% Senior Secured Second Lien Notes $ 76.1 Interest $ 7.6 the Board of Directors. matures December 31, 2020, bears interest @ 10.0% 1%/12% Step-Up Senior Secured Third Lien $ 750.0 $ - Convertible Notes matures December 31, 2030, bears interest @ 1% for 4 years and then 12% to maturity; all interest is payable in-kind Total $ 969.1 $ 19.1 9
Oil & Gas Market Conditions • Record production anticipated to continue to exceed record demand. • 2015: Record production achieved despite E&P spending cuts of approximately 20%+. • 2016: Average E&P spending forecast indicates another reduction of 15% – E&P spending forecast based on higher than current oil prices indicating further downside risk. Source: International Energy Agency, “Oil Market Report” 10
Rig Market Conditions • E&P spending forecasts indicate further How many rigs will be scrapped or have drilled decline in rig demand across all classes their last well? of assets. • Approximately 88 jackups and 31 Age of Floater Fleet Age of Jackup Fleet floaters scheduled for delivery from Age Rigs % Age Rigs % shipyard in 2016. Many deliveries are 25 years or older 113 37% 25 years or older 296 55% being deferred. 10 to 24 years 41 13% 10 to 24 years 41 8% 0 to 9 years 155 50% 0 to 9 years 205 38% 309 100% 542 100% • Marketed utilization at multi-year lows Source: ODS Petrodata of approximately 74% for jackups and 77% for floaters. • Dayrates across all asset classes approaching breakeven. • Marketed supply will be impacted by retirements and cold stacking, and actual number of shipyard deliveries. 11
Industry Response • Significant cost cutting and downsizing workforce. • Deferring capital expenditures; deferring shipyard deliveries. • Cold stacking/retiring older less efficient rigs. • Amend and extend current contracts to preserve contract backlog at lower dayrates. • Preserving liquidity by selling assets and amending credit facilities. • Consolidation – primarily in oilfield service companies. Expectation for a consolidation in drillers as cycle continues. 12
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