Santos Limited · ASX:STO
Santos — Non-Deal Roadshow (November 2004)
19 slides from Santos's roadshow presentation, November 2004
Slide 1: Meeting the Challenge: International Roadshow
Meeting the Challenge International Roadshow November 2004 1 Disclaimer & Important Notice This presentation contains forward looking statements that are subject to risk factors associated with the oil and gas industry. It is believed that the expectations reflected in these statements are reasonabl
Slide 2: Presentation Outline / Who Are We?
Presentation Outline 1. Who we are and how we are changing 2. New projects replacing old 3. Potential Big Gas Commercialisation 4. Exciting exploration program 5. Dividend yield and capital management 3 1. Who Are We? West Natuna USA Kutei Papua New Guinea East Java Egypt Darwin Timor Sea Bonaparte
Slide 3: Santos' Strategy: How / Growth Options
Santos’ Strategy: How Leverage our base Domestic gas franchise business Core competencies through Exploration Acquisitions Option generation Cost leadership Gas commercialisation Production optimisation and Portfolio management Superior capital allocation 5 Growth Options Exploration Production Gas
Slide 4: Exploration Options / Creating Value
Exploration Options Net Mean Resource Potential (mmboe) High Australia Deep Water Egypt Indonesia USA SE Australia Gas NW Australia Oil High Risk Low Risk 7 Creating Value Production growth 6-8% Production grows Reserve EBITDA* Reserves growth ps and Margin Netback replacement grow grows ≥ A$22* rat
Slide 5: How Are We Changing? / New Projects Replacing Old
How Are We Changing? • Structure • Culture • Smarter commercialisation • Improved systems • Exploration 9 2. New Projects Replacing Old 10 5
Slide 6: Managing Existing Assets / Developing New Assets
Managing existing assets Moomba Fully recovered from New Year’s Day incident. Modernisation program well advanced. Increasing investment in high value oil opportunities East Spar John Brookes accelerated in response to water breakthrough. Stag Work-overs, infill drilling, water injection. 11 Develop
Slide 7: Mutineer-Exeter Field Development / Global Oil Prices
Mutineer-Exeter Field Development Legend Current Program WA-26-L Drilled well Adams Planned well Mutineer 4 M2 Mutineer 5 Mutineer Manifold 2 Norfolk 1 WA-27-L M8 P&A FPSO M3 “Modec 11” Mutineer 9 Pitcairn 1 Tintagel M7 P&A Mutineer 3 2 Exeter Manifold 2 Bounty 1 Oil pipeline Mevagissey 6 Exeter 4H
Slide 8: Why are oil prices high? / Potential Projects 2007-2010+
Why are oil prices high? Hurricane Lily Gulf of Mexico Iraq oil pipeline 15 Developing New Assets Potential Projects 2007–2010+ 2007 2008 - 2009 2010+ • Sole • Petrel-Tern • Hides • Golden Beach • Evans Shoal • Indonesia exploration • Kipper • Indonesia exploration • Otway exploration • US explorati
Slide 9: Potential Big Gas Commercialisation / Reserves
3. Potential Big Gas Commercialisation Possible Resource Development Timing (mmboe) Bass Strait 2007 37 Bonaparte 2008/09 253 Timor 2008/09 452 PNG 2010 + 320 17 Gas Commercialisation and Reserves (mmboe) 1600 1450 1400 1200 1000 800 636 600 400 338 200 0 Proven (1P) Proven + Contingent Probable (2P
Slide 10: Exploration: The Journey So Far / Basin Excellence Strategy
4. Exploration: The Journey So Far Basin Excellence Building a portfolio of opportunities New Ventures International Portfolio Egypt/Middle East/Nth Africa strength, value + New Ventures core areas optionality US/Indonesia/Australia Drilling the new opportunities Maximise value of existing portfolio
Slide 11: Active Portfolio Management / Active Drilling Program
Active Portfolio Management Exploration first half 2004 Gulf of Suez Gulf of Mexico East Java Timor Sea Gulf of Suez East Java NT/ Woodbine Ras Abu Egypt P61 Texas Darag Cougar Jeruk 1 S.E. July Khefren 1 Area l Are a ll Are a lV Area V Nth Torres 1A Gulf of Bali l Ar ea lll N. Zeit Bay Jeruk Timor
Slide 12: Jeruk 2 Oil Discovery / Dividend and Capital Management
Jeruk 2 Oil Discovery • Constrained flow of 7500 barrels of oil per day • Tested only top of reservoir • Well being deepened to find Oil Water Contact • To be followed by 3D seismic 23 5. Dividend and Capital Management • Long dividend history • Funding growth program while keeping gearing within ta
Slide 13: Why Santos?
Why Santos? • Growing production profile • Leverage to high oil prices • Leverage to large gas resources • Exciting exploration programme • Continuing strong dividend yield 25 Jeruk 2 Testing 26 13
Slide 14: Reference slides: Prices & Exchange Rates
Reference slides 27 Prices & Exchange Rates Half Year Half Year Change 2004 2003 % Realised Oil Prices (USD/bbl) 32.63 28.63 +14.0 AUD/USD Exchange Rate 0.6978 0.6236 -11.9 (after hedging) Realised Oil Price (AUD/bbl) 46.76 45.91 +1.9 USA Gas Price (USD/mcf) 5.81 6.07 -4.3 Australian Gas Prices (AUD
Slide 15: 2004 First Half Results / Second Half Sensitivities
2004 First Half Results Half Year Half Year Change 2004 2003 % Gross Profit 165 274 Profit on Sale of Non-Current - 5 Assets Other Revenue 18 11 SG&A Expenses (36) ** (18) Borrowing Costs (14) (20) Income Tax (42) (82) Net Profit after Tax before Write 91 170 -46.5 Downs Write downs (after tax) (4)
Slide 16: Upcoming Exploration / Sampang PSC
Upcoming Exploration Well Basin/Area Target Upside Resource Santos Quarter Potential (mmboe) Interest drilling unrisked % Expected to start Khefren 1 Gulf of Suez Oil 120 20 Drilling Jeruk 2 East Java Oil 170 50 Drilling - Oil Martha 1 Otway offshore Gas 55 50 Drilling Callister 1 Otway offshore Gas
Slide 17: North Bali I PSC / Otway Deep Water
North Bali l PSC Agung prospect Proposed Agung 1 N 4km Proposed Agung 1 Top Kujung Limestone Agung 33 Otway Deep Water Amrit prospect Amrit VIC/P 51 VIC/P 52 Proposed Amrit 1 5km VIC/P 52 VIC/P 51 34 17
Slide 18: Gulf of Suez / Popodi PSC
Gulf of Suez Khefren 1 BP Edfu discovery BP Saqqara discovery 2001, 63 mmbo 2003, 80 mmbo Khefren 1 Khefren 1 35 Popodi PSC Pohon prospect Proposed Pohon 1 Middle Miocene depth structure Upper Miocene Pohon Middle Miocene 36 18
Slide 19: Investor Relations - Santos
Investor Relations – Santos Graeme Bethune, Group Executive Investor Relations P: +61 8 8218 5157 M: 0419 828 617 E: [email protected] Mike Hanzalik, Analyst P: +61 8 8224 7725 M: 0439 892 143 E: [email protected] Brooke Pedersen, Assistant Analyst P: +61 8 8224 7227 M: 0400 250 027 E