Dana Gas PJSC · ADX:DANA
Dana Gas PJSC — Investor Presentation (March 2016)
44 slides from Dana Gas PJSC's investor presentation, March 2016
Slide 1: Clean Energy For the MENA Region's Tomorrow
Clean Energy For the MENA Region’s Tomorrow Dana Gas Investors Presentation March 2016 www.danagas.com 1
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation contains forward-looking statements Forward-looking statements are based on certain assumptions which may be identified by their use of words like “plans,” and expectations of future events. The Company, its “expects,” “will,” “anticipates,” “believes,” “i
Slide 3: Presentation Outline
Presentation Outline Gas – Growth fuel in MENA Dana Gas – Overview Country Operations – Egypt and KRI Project Update – Zora Gas, UAE Credit Metrics Relative Valuations Summary www.danagas.com 3
Slide 4: Gas is the growth fuel of the 21st Century
Gas is the growth fuel of the 21st Century. Gas has strong environmental credentials and is cost competitive Current full lifecycle costs for new-build power generation including CO2 emissions from fuel externalities (US$/boe) (% share of global emissions) Gas 20% Coal 44% Oil 36% Switching from coa
Slide 5: MENA region has strong economic growth credentials
MENA region has strong economic growth credentials. Energy requirements of the region are expected to increase. Population growth in MENA countries 400 Bahrain 350 Qatar Kuwait 300 Population (millions) Oman 250 Libya UAE 200 Tunisia 150 Yemen Saudi Arabia 100 Iraq 50 Algeria Egypt 0 GDP growth in M
Slide 6: MENA gas demand is growing strongly
MENA gas demand is growing strongly. Dana Gas is well placed to be one of the region’s leading independent suppliers of this gas. 2000-14 MENA gas demand (bcm)* 600 Other ME Gas consumption (bcmpa) 500 Gas demand growth Kuwait (2000-2014 CAGR) 400 Algeria Qatar China – 14.5% 300 Egypt 200 UAE MENA –
Slide 7: Dana Gas as regional gas integrated player
Dana Gas as regional gas integrated player focused on matching resource with markets Gas Resource* Holders in MENA (Total Reserves: c. 92 tcm) 40 Proved gas reserves, tcm Access to Private Capital Open 30 Potentially Open Closed/inaccessible 20 10 0 Iran Qatar Iraq^ Saudi UAE Algeria Egypt Kuwait Li
Slide 8: Dana Gas – Business Profile
Dana Gas – Business Profile www.danagas.com 8
Slide 9: Dana Gas: Independent E&P company listed on the ADX
Dana Gas: Independent E&P company listed on the ADX Dana Gas is operating at the heart of the world’s Dana Gas is a MENA focused gas independent largest hydrocarbon region headquartered in the UAE Quoted in the Abu Dhabi Securities Exchange. Bloomberg: DANA:UH Shares outstanding: c. 6969 milli
Slide 10: Dana Gas works across the gas value chain
Dana Gas works across the gas value chain addressing both domestic and export market needs in MENA region Dana Gas is operating at the heart of the Production Profile world’s largest hydrocarbon bearing region CAGR 10.3% Net reserves & resources (YE 2015) Midstream and Business Model across the gas
Slide 11: Consistent production growth, delivery and financial performance since 2007
Consistent production growth, delivery and financial performance since 2007 Production Revenue CAGR: 5% CAGR: 10.3% Profit After Tax CAGR: 21.6% www.danagas.com *Includes 700bpd from EBGDCO (LPG plant) 11
Slide 12: Dana Gas: Country Business Highlights – Egypt
Dana Gas: Country Business Highlights EGYPT www.danagas.com 12
Slide 13: Egypt gas market fundamentals are sound
Egypt gas market fundamental are sound. New gas discoveries and gas imports are likely to return Egypt’s domestic demand to its historic growth trajectory Egypt annual gas supply/demand balance (post Zohr) Egypt’s current and planned regas capacity (Source: Woodmac) (Source: company data, Interfax)
Slide 14: Dana Gas is the 6th largest operator in Egypt
Dana Gas is the 6th largest operator and 5th largest onshore producer in Egypt 2016e Gas Production Ranking in Egypt (Source: Woodmac) (* denotes company is an operator) 1,800 2016 WI Production, mmcfpd 1,600 Mainly onshore production 1,400 Mainly offshore production Dana Gas Egypt Credentials: 1,20
Slide 15: Egypt: Nile Delta Operations
Egypt: Nile Delta Operations El Wastani Development Leases: • Onshore acreage consisting of 14 Development Leases in the prolific Nile Delta region Production: • 4Q 2015 avg 32.2 kboe/d versus 37.6 kboe/d for 4Q 2014. Decline in production followed a steady and Balsam 3 Balsam 2 predictable downward
Slide 16: Gas Production Enhancement Agreement (GPEA)
Gas Production Enhancement Agreement (GPEA) helps Egypt increase production while delivering long term value to Dana Gas Gas Enhancement Project – Execution Progress • Longest gas column encountered in Dana Gas Egypt portfolio. • Pulse test between Balsam-1 and Balsam-2 indicated single compartment.
Slide 17: Block 6 – North El Arish Offshore Opportunity
Block 6 – North El Arish Offshore Opportunity • Block-6 (100% WI) • 1782 sq km of full fold 3D seismic acquired in October 2015 by PGS Ramform Titan boat. • 3D seismic processing completed in January 2016. • Initial processing results indicates numerous play types with significant potential based on
Slide 18: Egypt: Block 1 - North El Salhiya Exploration
Egypt: Block 1 - North El Salhiya Exploration Newly awarded exploration blocks in Nile Delta enables Dana Gas to build on its core area production and utilising existing infrastructure • Block-1 (100% WI) • Targets prolific Abu Madi play • Other plays include: Kafr El Sheikh and Oligocene Activities
Slide 19: Egypt: Block 3 - El Matariya Exploration
Egypt: Block 3 - El Matariya Exploration Newly awarded exploration blocks in Nile Delta enables Dana Gas to build on its core area production and utilising existing infrastructure • Block-3 (Dana Gas 50% WI) • BP is operating Block-3 as 50/50 partner. The primary target is the deeper HPHT, and high-
Slide 20: Dana Gas: Country Business Highlights – Kurdistan Region of Iraq
Dana Gas: Country Business Highlights Kurdistan Region of Iraq www.danagas.com 20
Slide 21: Operations in Kurdistan Region of Iraq
Operations in Kurdistan Region of Iraq DG share of production averaged 28,800 boepd during 4Q 2015. Gross production details are as follows: 313 MMscfd of natural gas 13,703 bbl/d of condensates 830 MT/d LPG The Mol sieve bed for the first train at Khor Mor plant was replaced in October 20
Slide 22: Rich gas and condensate producer with strong growth track record
Rich gas and condensate producer with strong growth track record Pearl Petroleum Company Ltd ownership: Dana Gas 35 % Khor Mor Field Production, Dana Gas net share Crescent Petroleum 35 % 35 OMV 10 % MOL 10 % Gas RWE 10 % * Liquids(Condensate + LPG) 30 25 Production (kboed) 20 15 10 5 0 www.danagas.
Slide 23: Khor Mor and Chemchemal among largest gas fields in KRI
Khor Mor and Chemchemal are potentially largest gas fields in the KRI and comparable to large scale gas developments in the region Large Gas Developments in MENA (Source: Company disclosure) 110 100 90 Gas initially in place resources (tcf) 80 70 60 50 40 30 20 10 0 KhorMor + Miran Bina Bawi Khazzan
Slide 24: Dana Gas: Project Update – Zora Gas, UAE
Dana Gas: Project Update – Zora Gas, UAE www.danagas.com 24
Slide 25: Zora Offshore Platform - Ready for gas production
Zora Offshore Platform - Ready for gas production Platform installation, hook up and commissioning completed. Wire line operation for un-plugging the well completed successfully. Repair works completed on the offshore pipeline, where concrete coating was damaged by Third party vessel anchors.
Slide 26: Zora Gas Processing Plant - Construction completion and handover
Zora Gas Processing Plant - Construction completion and handover All systems powered up, commissioning activities and start-up ongoing. Commissioning of truck loading facility for condensate export completed. www.danagas.com 26
Slide 27: Zora Operations start-up progress
Zora Operations start-up progress First gas delivered to site 10/01/16. Pipeline and well cleaned up with well flowing approx. 45 mmscfd. Gas production started on 14/01/16. Gas processing shutdown again 15/01/16, due to foaming problems. Contaminated chemical inventories changed and pipelin
Slide 28: Dana Gas: Credit Metrics
Dana Gas: Credit Metrics www.danagas.com 28
Slide 29: Additional financial information
Additional financial information Dana Gas additional financial metrics Period Unit Value EBITDA LTM US$m 191 EBIT LTM US$m 93 Net debt Current US$m 379 Net debt / EBITDA LTM x 2.0 Interest cover ratio LTM x 1.4 Book leverage (Net debt / Total assets) Current x 10% Average years to maturity Current Y
Slide 30: Dana Gas Sukuk Instruments
Dana Gas Sukuk Instruments Dana Gas share price vs. convertible trading value Sukuk convertible trading value (USD) Dana Gas share price (AED) Convertible Sukuk: 140 1.2 Convertible trading value (USD) 120 Principal amount: $352 1.0 mln Share price (AED) 100 0.8 80 Coupon: 7% (payable 60 0.6 qua
Slide 31: Leverage and interest coverage ratio in line with peers
Leverage and interest coverage ratio in line with peers Debt servicing: Net debt / EBITDA 4 2 Net debt / EBITDA 0 -2 -4 -6 -8 -10 DNO Premier Dana Gas Petroceltic Genel Lundin Tullow Note: Net debt is as of latest reports. EBITDA is a LTM value as of 9M 2015. Interest cover ratio 4 2 0 EBIT / Intere
Slide 32: Book gearing and Leverage comparable to industry peers
Book gearing and Leverage comparable to industry peers Total debt to total assets 90 80 Total debt to total assets 70 60 50 40 30 20 10 0 Lundin Premier Tullow DNO Petroceltic Dana Gas Genel Debt to common equity 600 Debt to common equity 500 400 300 200 100 0 Lundin Premier Tullow DNO Petroceltic D
Slide 33: Long reserve life of assets underpins debt
Long reserve life of assets underpins debt Years to average maturity 6 Years to average maturity (#) 5 4 3 2 1 0 Tullow DNO Premier Genel Dana Gas Lundin Petroceltic 2P reserve life 60 50 2P reserve life (years) 40 30 20 10 0 Lundin Petroceltic Dana Gas * DNO Genel Tullow Premier Source: Bloomberg.
Slide 34: Dana Gas: Relative Valuations
Dana Gas: Relative Valuations www.danagas.com 34
Slide 35: EV and Production valuation relative to peers
EV and Production valuation relative to peers Enterprise value vs 2015 production EV ($bn) 2015 Production (kboepd) 10 100 9 90 8 80 WI Production (kboepd) 7 70 Enterprise Value ($ bn) 6 60 5 50 4 40 3 30 2 20 1 10 0 0 Lundin Tullow Premier Dana Gas DNO Gulf Keystone Genel Petroceltic Circle Oil Tra
Slide 36: Significantly undervalued relative to peers
Significantly undervalued relative to peers EV / EBITDA (2017E) Price / EPS (2017E) 8 25 6.8 7 6.4 20.5 19.8 20 Price / EPS (2017E) EV / EBITDA (2017E) 6 5.3 5.0 5 Mean* ~4.5 15 13.0 Mean * ~13.2 12.2 4 2.9 8.4 3 2.6 2.5 10 2 5.1 5 1 n.a. 0 0 Lundin Petroceltic Dana Gas Tullow Premier Genel DNO Prem
Slide 37: Relative Performance
Relative Performance ‐90% ‐80% ‐70% ‐60% ‐50% ‐40% ‐30% ‐20% ‐10% 0% ‐100% www.danagas.com Indus gas DanaGas Lundin Petroleum Det Norske Brent Soco Intl. Source: Bloomberg, performance as of 16/02/2016 Cairn Energy Shamaran Green Dragon Western Zagros Africa Oil Faroe Petroleum Bowleven Lekoil Karoo
Slide 38: Relative Performance
Relative Performance ‐80% ‐70% ‐60% ‐50% ‐40% ‐30% ‐20% ‐10% 0% 10% 20% Lundin Petroleum www.danagas.com Maurel & Prom Shamaran Africa Oil Cairn Energy Det Norske Indus gas Green Dragon Source: Bloomberg, performance as of 16/02/2016 Soco Intl. Western Zagros Karoon Gas Rockhopper Brent Tullow Oil F
Slide 39: Relative share price performance of Dana Gas
Relative share price performance of Dana Gas Relative performance of Dana Gas vs market indices 140% 120% Received Signed the Abu Dhabi Index +57% US$53mln GPEA in Egypt Partial award from Egypt in KRI Successful Arbitration resolution of 100% RWEST Arbitration Achieved record 80% 2013 production S&
Slide 40: Dana Gas has performed in line with international peers in H2 2015
Dana Gas has performed in line with international peers in H2 2015 Relative performance of International peers since July 2015 Relative performance of International peers since Oct 2015 40% 60% 20% 40% - 20% Relative performance (% ) Relative performance (% ) (20%) - (40%) (20%) (60%) (40%) Dana Gas
Slide 41: Dana Gas has outperformed its Middle Eastern peers in H2 2015
Dana Gas has outperformed its Middle Eastern (ME) peers in H2 2015 Relative performance of ME peers since July 2015 Relative performance of ME peers since October 2015 40% 60% 40% 20% 20% - Relative performance (% ) Relative performance (% ) - (20%) (20%) (40%) (40%) (60%) (60%) Dana Gas -2% Dana Ga
Slide 42: Summary
Summary www.danagas.com jl: ails DANAGAS 42
Slide 43: Summary
Summary 2015 has been a tough year with a difficult business environment, and the future is continuing to look challenging with oil having already hit a low of $27/bbl this year. However, it has also been a year of significant progress: Rejuvenated the management team with the appointment of I
Slide 44: Contact Us: Dana Gas PJSC
Contact Us: Dana Gas PJSC P. O. Box 2011, Sharjah, UAE www.danagas.com E-mail : [email protected] Direct : +971 6 519 4401 Fax : +971 6 556 6522 www.danagas.com 44