Savannah Energy Plc · LSE:SAVE

Savannah Energy — Savannah Petroleum — Investor Presentation (June 2017)

37 slides from Savannah Energy's investor presentation, June 2017

  1. Slide 1: Corporate Presentation

    Corporate Presentation JUNE 2017

  2. Slide 2: Disclaimer

    Disclaimer These presentation materials (the “Presentation Materials”) do not constitute or form any part of any offer or invitation or inducement to sell or issue or purchase or subscribe for any shares in Savannah Petroleum plc (“Savannah”) nor shall they or any part of them, or the fact of their

  3. Slide 3: Corporate Overview

    Corporate Overview SAVANNAH PETROLEUM (“SAVANNAH”) Market Statistics  Focused around the exploration of the R1/R2 and R3/R4 PSC areas in the Agadem Rift Listing AIM (SAVP) Basin (“ARB”) of South East Niger Shares Outstanding 274,621,447  Listed on the AIM market of the London Stock Exchange with a

  4. Slide 4: Agadem and the Central African Rift System

    Agadem and the Central African Rift System Bongor Trough Agadem Rift Basin 417 mmbbls 975 mmbbls 2P reserves c.50 kbd production capacity 20 kbd current production1 Melut Basin 1,782 mmbbls c.250 kbd max. production capacity Doba Trough Muglad Basin 1,059 mmbbls 2,053 mmbbls c.100 kbd current produc

  5. Slide 5: ARB Exploration and Activity History

    ARB Exploration and Activity History PRE-CNPC ERA (1975 – 2004)  5 discoveries made from 25 exploration wells (i.e. 20% success rate) CNPC ERA (2008+)  US$300m signature bonus paid  97 discoveries from 127 exploration wells (i.e. 76% success rate)  225 wells drilled in total (i.e. including appr

  6. Slide 6: The Scale of the Basin: Agadem vs UK CNS

    The Scale of the Basin: Agadem vs UK CNS  Also a Rift Basin  ‘Slow burn’ early exploration limited by data quality  Dozens of successful plays proven through application of modern methods  Focus play not yet creamed  Two more key plays proven  Multiple additional upside plays to explore  Mode

  7. Slide 7: Dataset and Resource Evolution: July 2014 – June 2017

    Dataset and Resource Evolution: July 2014 – June 2017 JULY 2014 JULY 2015 JUNE 2017 Assessed Plays Assessed Plays Assessed Plays  Alternances   Alternances   Alternances   Yogou   Yogou   Upper Sokor  573 mmbbls risked 1,191 mmbbls risked 2,185 mmbbls risked recoverable resources1 recove

  8. Slide 8: Dataset Evolution: Key Workstreams Completed

    Dataset Evolution: Key Workstreams Completed  Over 3,200 man days of work has been completed on the project since inception, by a core 10 person technical team  Principal workstreams completed over the past year include:  Interpretation of core seismic, FTG and magnetic datasets  Rock physics an

  9. Slide 9: Simplified ARB Geological Model

    Simplified ARB Geological Model EXISTING BASIN PLAY TYPES AND POTENTIAL UPSIDE STYLISED CARTOON OF ARB GEOLOGY  To date, oil discoveries in the ARB have been in structural trapping configurations, whereby oil has been trapped across a fault against shale in sandstone reservoirs  The principal form

  10. Slide 10: R3 Basin Setting

    R3 Basin Setting  Along trend with some of the largest discoveries in the basin  Located in the oil source kitchen  Extremely high strike rate in the area  Mapped prospects are “look-alikes” for discoveries along trend 10

  11. Slide 11: R3 2D vs. 3D Seismic Comparison

    R3 2D vs. 3D Seismic Comparison R3 BLOCK WITH PART OF THE NEW 3D MAPPING NESTED IN A 2D SEISMIC REGIONAL GRID  3D offers a significant uplift in detail compared with sparse 2D New R3 East 3D Seismic Volume  Reduction in uncertainty when seeking to calculate prospective resources using 3D vs. 2D 

  12. Slide 12: Firm and Optional Drilling Targets (1)

    Firm and Optional Drilling Targets (1) MENA KISKI 39 MMbbls Alt 25 MMbbls Alt 15 MMbbls US DAMISSA 74 MMbbls Alt 41 MMbbls US 46 MMbbls Yogou KUNAMA 10 MMbbls Alt EFITAL 25 MMbbls US 71 MMbbls Alt 37 MMbbls US 18 MMbbls Yogou ADAL ERIDAL 76 MMbbls Alt 16 MMbbls Alt 31 MMbbls US 13 MMbbls US 7 MMbbls

  13. Slide 13: Confirmed Drilling Campaign – Bushiya

    Confirmed Drilling Campaign – Bushiya  Situated within main source kitchen fairway with proven oil accumulations BUSHIYA SEISMIC PROFILE  Mapped using new 3D survey, and excellent reservoir potential proven in offset wells SW NE  To be drilled with a vertical well  Stacked pay with Alternances p

  14. Slide 14: Confirmed Drilling Campaign – Amdigh

    Confirmed Drilling Campaign – Amdigh  Situated within main source kitchen fairway with proven oil accumulations AMDIGH SEISMIC PROFILE  Mapped using new 3D survey, and excellent reservoir SW NE potential proven in offset wells  Mildly deviated well to optimise chance of success Top Up. Sokor Mark

  15. Slide 15: Confirmed Drilling Campaign – Well 3 Option 1: Eridal

    Confirmed Drilling Campaign – Well 3 Option 1: Eridal  Situated within main source kitchen fairway with proven oil accumulations ERIDAL SEISMIC PROFILE  Mapped using new 3D survey, and excellent reservoir potential proven in offset wells SW NE  Stacked pay with Alternances primary target and Uppe

  16. Slide 16: Confirmed Drilling Campaign – Well 3 Option 2: Kunama

    Confirmed Drilling Campaign – Well 3 Option 2: Kunama KUNAMA SEISMIC PROFILE  Situated within main source kitchen fairway with proven oil accumulations SW NE  Mapped using new 3D survey, and excellent reservoir potential proven in offset wells Top Up. Sokor Marker  Stacked pay with Alternances pr

  17. Slide 17: Operational Progress (1): R3 East 3D Seismic Acquisition

    Operational Progress (1): R3 East 3D Seismic Acquisition  In January 2017 Savannah successfully completed the acquisition of 806km2 3D seismic over a portion of R3, coming in both under budget and ahead of time  R3 sits within a proven petroleum “sweet spot” in the basin, with some of the largest

  18. Slide 18: Operational Progress (2): Preparation for Drilling Underway

    Operational Progress (2): Preparation for Drilling Underway CONSTRUCTION OF LOGISTICS CAMP AND PIPE YARD ON R3 COMPLETE VSAT INSTALLED AHEAD OF DRILLING START LOADING OF CASINGS IN COTONOU AHEAD OF TRANSPORTATION TO R3 18

  19. Slide 19: Savannah’s Drilling Team

    Savannah’s Drilling Team  Overall responsibility for the safe and efficient delivery of all Savannah’s operations Antoine Richard,  Strong operational background, including in the design, construction and operation of onshore facilities, the management of VP Operations large drilling campaigns and

  20. Slide 20: Drilling Conditions & Well Plans

    Drilling Conditions & Well Plans  Benign drilling conditions, with no H2S or CO2 present in the Indicative Days vs Depth basin and normal pressures and temperatures 0  Wells are vertical or mildly deviated (20° inclination)  Well TDs range from c. 2,100m – 2,600m  Primary target – Sokor Alternan

  21. Slide 21: Logging and Testing – Maximising Value from Exploration

    Logging and Testing – Maximising Value from Exploration TESTING RIG ON THE MOVE TO  Savannah plans to drill and test its wells using a phased approach, ITS NEXT LOCATION ON enhancing the operational and cost efficiency of the campaign AGADEM  Phase I: drilling and extensive wireline logging of tar

  22. Slide 22: Oil Export Infrastructure

    Oil Export Infrastructure INFRASTRUCTURE ACCESS  Under the terms of the R1/R2 and R3/R4 PSCs, the Petroleum Code of Niger and its Implementing Decree, Savannah is entitled to access third party infrastructure EXISTING AND PLANNED INFRASTRUCTURE  CNPC currently sells domestically to the c20kbd capa

  23. Slide 23: Expansion into Nigeria

    Expansion into Nigeria NNDC/NNPC PARTNERSHIP  Savannah has entered into a MOU with the New Nigeria Development Company Ltd (“NNDC”), a company owned by the 19 northern states of Nigeria and focused on the economic development of the north of Nigeria, and the Nigerian National Petroleum Corporation

  24. Slide 24: Indicative Work Programme

    Indicative Work Programme Activity 2H 2017 1H 2018 2H 2018 Completion of R3 East Processing & Interpretation OPTION: R3 Central 3D Seismic Acquisition OPTION: R1 North 3D Seismic Acquisition CONFIRMED: Bushiya Exploration Well CONFIRMED: Amdigh Exploration Well CONFIRMED: Third Exploration Well (Kun

  25. Slide 25: Board and Management

    Board and Management  A geologist by profession Steve is widely recognised as one of the most capable oil and gas executives in the UK Steve Jenkins, Chairman  Previously Founder and CEO of Nautical Petroleum which was sold for £414m to Cairn Energy in Q3 2012  Currently Chairman of the Oil and G

  26. Slide 26: Appendix (1) – Additional Niger License Area Information

    Appendix (1) – Additional Niger License Area Information 26

  27. Slide 27: Overview of Main PSC Terms

    Overview of Main PSC Terms Net After Royalty  Signature bonus and related expenditure:  US$34m R1/R2 (40% cost recoverable)  US$28m R3/R4 (60% cost recoverable)  Royalties: Profit Oil Cost Oil  Oil – 12.5%  Gas – 2.5%  Cost Oil:  Recovery of 100% of capital and operating costs (capped at 70%

  28. Slide 28: PSC Phases and Work Programme – R1/R2 vs. R3/R4

    PSC Phases and Work Programme – R1/R2 vs. R3/R4 R1/R2 R3/R4  4 year term  4 year term  Minimum work programme:  Minimum work programme:  500km2 3D seismic  750km2 3D seismic Phase 1  2 wells  3 wells  50% relinquishment of land at end of phase, excluding land already  50% relinquishment of

  29. Slide 29: Firm and Optional Drilling Targets (2)

    Firm and Optional Drilling Targets (2) Targeted Unrisked Mean Recoverable, mmbbls Target Name Block Alternances Upper Sokor Yogou FIRM WELLS: Well 1 – Bushiya R3 (R3 East 3D Area) 31 17 Well 2 – Amdigh R3 (R3 East 3D Area) 41 12 Interpretation ongoing. Well 3 (Option 1) – Eridal R3 (R3 East 3D Area)

  30. Slide 30: Potential Development Economics – Kaduna Trucking

    Potential Development Economics 1 – Kaduna Trucking Development Statistics  Assumes early production facilities giving production start- up within 2 years of discovery Reserves (mmbbls) 70  Plateau production of 10kbd is reached in 2020 for 10 Peak Oil Production (kbd) 10 years, declining thereaft

  31. Slide 31: Potential Development Economics – Kaduna Pipeline

    Potential Development Economics 2 – Kaduna Pipeline Development Statistics  Assumes early production facilities giving production start- up within two years of discovery Reserves (mmbbls) 73  Plateau production of 18kbd is reached in 2020 for 2 years, Peak Oil Production (kbd) 18 declining thereaf

  32. Slide 32: Potential Development Economics – Chad-Cameroon Pipeline

    Potential Development Economics 3 – Chad-Cameroon Pipeline Development Statistics  Assumes early production facilities giving production start- up within two years of discovery Reserves (mmbbls) 73  Plateau production of 18kbd is reached in 2020 for 2 years, Peak Oil Production (kbd) 18 declining

  33. Slide 33: Appendix (3) – Niger Country Information

    Appendix (3) – Niger Country Information 33

  34. Slide 34: Niger – Current Licensing Position

    Niger – Current Licensing Position License Information Name Principal Owner Nationality 6 1 R1/R2 Savannah Petroleum British 2 R3/R4 Savannah Petroleum British 4 5 3 Agadem CNPC Chinese 1 3 4 Bilma CNPC Chinese 2 5 Tenere CNPC Chinese 6 Kafra Sonatrach Algerian Savannah, alongside CNPC and Sonatrach

  35. Slide 35: Niger – Key Facts

    Niger – Key Facts  2015 population of 19.9m people (61st largest population in the world)  Landlocked country in West Africa covering 1,267,000km2 (21st largest country in the world)  Terrain mainly desert, with arable land in the South West and South East  Former French colony, now boasts a “re

  36. Slide 36: Niger – Key Economic Statistics

    Niger – Key Economic Statistics 2000 2005 2010 2015 Population, total (millions) 10.99 13.18 15.89 19.90 Population growth, annual (%) 3.6 3.7 3.8 4.1 GDP (current US$, billions) 1.80 3.41 5.72 7.14 GDP growth, annual (%) (1.4) 4.5 8.4 (13.4) Inflation, GDP deflator (annual %) 4.5 6.6 2.6 2.6 Extern

  37. Slide 37: Corporate Presentation

    Savannah Petroleum 40 Bank Street Corporate Presentation London E14 5NR T: +44 (0) 20 3817 9844 [email protected] www.savannah-petroleum.com

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