Hibiscus Petroleum Bhd. · MYX:HIBISCS
Hibiscus Petroleum Bhd — Investor Presentation (May 2015)
50 slides from Hibiscus Petroleum Bhd's investor presentation, May 2015
Slide 1: Seize the opportunity!
Seize the opportunity! Before proceeding to read further, please refer to the Disclaimer on pages 49-50 of this presentation. May 2015 1 R3
Slide 2: Contents
Contents Section One -Investment thesis Why Invest In Hibiscus ? Section Two –Company background and asset portfolio Section Three – A discussion on the future of Oil Section Four – A special look at our Oman success story 2
Slide 3: Section One - Investment thesis: Why Invest In Hibiscus?
Section One -Investment thesis Why Invest In Hibiscus ? 3
Slide 4: Key Investment Themes
Key Investment Themes • Hibiscus is structured to withstand industry and Resilience market volatility through its diversified asset base and balanced portfolio strategy. • Hibiscus can reconfigure its project approach and Agility structure to manoeuvre through challenging conditions with its high ca
Slide 5: Key strengths: Resilience
Key strengths RESILIENCE Low correlation to market volatility Healthy Cash Balance and Zero Debt Diversified asset base and balanced portfolio strategy Ability to leverage and raise capital 5
Slide 6: Asset Base & Work Program
Asset Base & Work Program Exploration and Appraisal Development Norway Middle East 16 Licenses Block 50, Oman • 2-10.5% stakes • 22% stake • Q2 2016 – Extended Well Test • 1H 2015 - Drill two exploration wells (PL 591 & PL338C) Australia • 2H 2015 - Drill two exploration VIC/L31 West Seahorse wells
Slide 7: Resources and Reserves
Resources and Reserves 2P + 2C Oil Reserves (MMbbls)* Prospective Resources (MMbbls/MMboe)* 43.0 6.9 87.3 8.0 246.4 10.5 1,135.0 4.3 Norway: 2 to 10.5% Australia - West Seahorse: 100% (Concession Operator) Oman Block 50 - Masirah: 22.4% (Concession Operator) JPDA - Kitan: 25%*** Sharjah - Zubara: 35
Slide 8: Hibiscus Strategy
Hibiscus Strategy PROSPECTIVE CONTINGENT RESOURCES RESOURCES RESERVES DECREASING RISK Highest value creation takes place in the $/boe, risked exploration phase Cash-flow generated from production funds when discoveries are dividends, equity for development and high made impact exploration which in t
Slide 9: Key strengths: Agility
Key strengths AGILITY High calibre management team Rapid reconfiguration of project ownership and structures Scalable project execution to maximise returns on resources Swift response to new opportunities and partnerships 9
Slide 10: Board of Directors
Board of Directors Zainul Rahim bin Mohd Zain (Non-Independent Non-Executive Chairman) 180 • Chairman Shell Companies Egypt and Deputy Chairman Shell Companies Malaysia • Formerly on the board of Petronas Carigali (2010 - 2014) 160 Dr Kenneth Pereira (Managing Director) • Former Managing Director of
Slide 11: Management Team
Management Team Mark Paton (Chief Business Development Vincent Lee (Chief Financial Devarajan Indran (Head of Petroleum Officer) Officer) Engineering) • Former CEO of ASX-listed Cue Energy Resources Ltd • Formerly with Mubadala Petroleum, Malaysia •Founder of Upstream Petroleum which was sold to • F
Slide 12: Plan for Success (Development)
Plan for Success (Development) • Planning for Success offers a compelling RISK / REWARD ratio: – Planning for Success requires a very SMALL INVESTMENT – The REWARD is potentially 12 – 18 months earlier First Oil • Large Operators have internal processes that prevent such an approach • Small Operator
Slide 13: Key strengths: Strategic and aggressive in pursuing returns
Key strengths STRATEGIC AND AGGRESSIVE IN PURSUING RETURNS Perpetual capital build to achieve scale Unrelenting focus on high return assets Use of advanced exploration technology Ability to lower project costs in current oil price scenario 13
Slide 14: Achieving Scale 2016 Mission
Achieving Scale 2016 Mission Moving towards a 100MMbbls/boe reserves target Current Projects- Drilling & Resources Development Unrisked prospective resources activities targeted (mmbls/boe) To be a Respected Independent E&P Company Australia Sea Lion 6.9 Norway - PL591 8.8 - PL616 5.1 100 MMbbls 2P/
Slide 15: Forward Execution of Strategy
Forward Execution of Strategy Aggressive schedule with four to six exploration wells plus one appraisal well in 2015. A success in any one exploration well would be transformational. 2015 Stage Block J F M A M J J A S O N D Sharjah O Drilling six exploration wells in 2015: Sharjah (50% farm out) , 4
Slide 16: New Opportunities
New Opportunities Examples of project types being explored • Development of proven reserve Opportunity 1 • Field located in Malaysia • Acquisition of producing asset Opportunity 2 • Field located in Europe Opportunity 3 • Acquisition of exploration asset • Located in Malaysia Opportunity 4 • Acquisi
Slide 17: Part Two - Company Background and Assets
Part Two - Company Background and Assets 17
Slide 18: Timeline of What We've Achieved
Timeline of What We’ve Achieved VIC/P57 FDP approved and Production License Offered (5 December 2013) 3.00 Oman Drilling Program Commences (25 November 2013) Share Price Additional Concessions in Norway (2 May 2012) and RAK (10 April 2012) 2.50 OMAN OIL DISCOVERY Shareholders Approve Lime Deal (3 Fe
Slide 19: Hibiscus Share Price vs Oil Price
Hibiscus Share Price vs Oil Price 120 1.8000 16 January 2015 14 October 2014 Announcement from Dr. Kenneth Gerard Pereira, the Managing Director Proposed Placement of up to ten percent of the company in relation to the acquisition of the shares by Hibiscus (10%) of the issued share capital of Upstre
Slide 20: Capital Structure
Capital Structure Capital Structure : 30 April 2015 Price Mkt Cap • Non-Independent Directors and Management hold largest block (18.2%) Total Number (RM) RM’000 • Diversified shareholder base Total Number of • Most large shareholders are involved in or familiar with the oil and gas industry 0.79 920
Slide 21: Overview of our Assets
Overview of our Assets HIBISCUS PETROLEUM BERHAD (Listed on Bursa Malaysia) Lime (Private) 35% 13% 3D Oil HiRex 41% (Listed- ASX) (Private) Middle East Norway 55% 20% VIC/ P57* RAK Offshore 59% PL 498 25% PL 503C 12.5% VIC/ L31* 100% Sharjah 100 % PL 498B 25% PL707 10% Onshore Concessions Offshore O
Slide 22: Exploration Assets
EXPLORATION ASSETS 22
Slide 23: Sharjah Offshore
Sharjah Offshore Asset Name: Sharjah Offshore Asset Type: Exploration Country: United Arab Emirates Project Manager: Hibiscus Acquisition Date: June 2011 Water Depth/ Size: Up to 350 m/ 1600km2 Discovery increases GCOS and valuations of other prospects Work Completed: • Seismic Acquisition • Mapped
Slide 24: Sea Lion
Sea Lion Asset Name: Sea Lion (VIC/P57) Asset Type: Exploration Country: Australia Operator: Hibiscus Acquisition Date: January 2013 Water Depth/ Size: Up to 150m/ 460km2 Participating Interest: 55.1% (Concession Operator) (63% if inc. Indirect) Work Completed: • Mapped drill-ready prospects • Rig s
Slide 25: Lime Norway 2015 Drilling
Lime Norway 2015 Drilling Through Lime Norway, Hibiscus will be participating in the drilling of four exploration and one appraisal well on the Norwegian Continental Shelf. PL591 Lime Norway Stake: 25% PL708 Lime Norway Stake: 10% Operator: Tullow Oil Norge AS Operator: Lundin Norway AS Date: 1H 201
Slide 26: Development Assets
DEVELOPMENT ASSETS 26
Slide 27: L-31 West Seahorse Field (Australia)
L-31 West Seahorse Field (Australia) Asset Name: West Seahorse (VIC/L31) Asset Type: Development Acquisition Date: January 2013 Operator: Hibiscus Participating Interest: 100% (Concession operator) Timing for FID: December 2014 Work Completed: Field Development Plan approved Production License obtai
Slide 28: Our Oman success story
Our Oman success story Asset Name: Oman Block 50 Asset Type: Development Country: Oman Project Manager: Hibiscus Effective Date: August 2011 Water Depth/ Size: Up to 150m/ 16,900km2 Participating Interest: 22.4% (through Lime) Discovery Date: March 2014 (1st offshore discovery off east of Oman) Work
Slide 29: Oman Development
Oman Development Completed within 3 years as opposed to normal cycle of 3 to 5 years Early Q2 2011 2015 2016 2014 2014 Seismic acquisition/ Successful Review of processing and Multi-well License Rig oil discovery technical interpretation campaign Acquired Farm-out secured & flow test solutions Seism
Slide 30: Production Asset
PRODUCTION ASSET* *Pending completion of acquisition of 100% of Talisman Resources JPDA (06 105) Pty Ltd 30
Slide 31: Kitan Oil Field
Kitan Oil Field Asset Name: Kitan Oil Field (JPDA 06–105)* Asset Type: Production Country: Joint Petroleum Development Authority (Australia – Timor Leste) Operator: ENI Agreement Date: June 2014 Water Depth/ Size: Up to 330m/ 85 km2 Work Completed: • Field developed with FPSO and three subsea 4.3 mm
Slide 32: Part Three - A discussion on the future of Oil
Part Three - A discussion on the future of Oil 32
Slide 33: Europe Brent Spot Price (Dollars per Barrel)
Europe Brent Spot Price (Dollars per Barrel) Oil Price from May 15, 1987 – May 15, 2015 160 140 120 100 80 60 40 20 0 33
Slide 34: Oil Price Impact Factors
Oil Price Impact Factors Softer Demand China Europe Energy Efficiency Gains Technology Solar Wind LNG Effect Stranded gas from floating LNG becomes viable Large investments making more gas transportable Supply US Shale Geopolitical issues Iraq Saudi Arabia Libya Rus
Slide 35: Is Cheap Oil Sustainable?
Is Cheap Oil Sustainable? Winners World Economy Shifting resources from producers to consumers China & India Agriculture based countries America Largest consumer and importer of oil Losers America Largest producer of oil OPEC Nations Russia Shale is uneconomic at $80 a barrel
Slide 36: US Shale Breakeven Prices
Shale Breakeven Prices US Shale Breakeven Prices 36
Slide 37: Why smaller companies will thrive?
Why smaller companies will thrive? Field Size by Production Total No. of Pre Volume (bbls/day) Production 1950s 1960s 1970s 1980s 1990s Fields 1950s (bbls/day) 1,000,000+ 4 8,000,000 2 1 1 500,000 – 1,000,000 10 5,900,000 2 3 3 1 1 300,000 – 500,000 12 4,100,000 3 1 6 1 1 200,000 – 300,000 29 6,450,
Slide 38: Part Four - Our Oman success story
Part Four – Our Oman success story 38
Slide 39: Block 50 History
Block 50 History - 1 Block Name : Block 50, Sultanate of Oman Date Acquired : August 2011 Water Depth : Up to 150m Size : 16,900km2 Operator History Company Year Started Work Completed Sun Oil 1976 OMAN Drilled 3 prospects Amoco 1984 Offset Acquired and Wells Triton 1989 reprocessed seismic data Acq
Slide 40: Masirah Oil Limited
Masirah Oil Limited • Listed in Singapore • Listed in Malaysia • Based in Switzerland • An independent E&P company • An independent E&P company • Private Bank Rex International Hibiscus Petroleum Schroder & Co Holdings Berhad Banque S.A. 56.4% 35% 8.6% National Oil Company of Ivory Coast Hibiscus Pe
Slide 41: Block 50 Potential?
Block 50 Potential ? ? Between 1976 - 2008, extensive seismic and exploration drilling activities were done without success. Why did Masirah Oil believe there was potential in the basin? 41
Slide 42: Investment Rationale
Investment Rationale - 1 A • Offshore structure mirrors prolific onshore basin • Masirah Bay includes equivalents of the Abu Mahara and deeper, Nafun, Wasia and Tertiary B A B OMAN ONSHORE OMAN OFFSHORE 42
Slide 43: Plan for Success
Work Programme Strategy Comprised of 3 phases Phase 1 Apply new technology; Detailed desktop review of Preliminary Rex Virtual Drilling prior datasets prospects Plan for Success Phase 2 Data acquisition, Define well processing and locations interpretation Phase 3 Drilling programme Plan for Success
Slide 44: Positives - A Discovery!
Positives - A Discovery! During a 48-hour test, hydrocarbons were flowed to the surface and the well achieved light oil flow rate of up to 3000 stock tank barrels per day with no water production. First discovery after 30 years of exploration offshore east coast of Oman. 44
Slide 45: Oman - Summary & Opportunities
Oman - Summary & Opportunities • First offshore discovery East Oman in 30 years • Perform additional 3D seismic (ongoing) • Appraise GA South with an Extended Well Test • Utilize an EWT concept that can be relocated to test other discoveries • Work closely with MOG to optimize the tendering process
Slide 46: Appendix
Appendix 46
Slide 47: Range of Certainty
Petroleum Economics Increasing Commerciality Low High Low Undiscovered - Discovered - Prospective Contingent Discovered - Resources Resources Reserves Range of Certainty High Estimate 3C 3P Best Estimate 2C 2P Low Estimate 1C 1P High Source: Society of Petroleum Engineers and World Petroleum Council
Slide 48: Thank You
THANK YOU 48
Slide 49: Disclaimer
Disclaimer This presentation has been prepared by Hibiscus Petroleum Berhad (the “Company”) solely for use at a presentation to be made as of this date and may not be used by any other party or for any other purpose. By attending the meeting where the presentation is made, or by reading the presenta
Slide 50: Disclaimer (Financial Promotion Order notice)
This presentation is made to and directed only at (i) persons outside the United Kingdom, (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) and (iii) high net worth individuals, and other persons t
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