Ecopetrol Sa · BVC:ECOPETROL
Ecopetrol Sa — Q1 2009 Earnings Presentation
27 slides from Ecopetrol Sa's earnings presentation, May 14, 2009
Slide 1: Financial and Operating Results for the First Quarter 2009
FINANCIAL AND OPERATING RESULTS FOR THE FIRST QUARTER 2009 May 14th, 2009 1
Slide 2: Disclaimer
Disclaimer This document was prepared by Ecopetrol S.A. with the purpose of providing the market and interested parties certain financial and other information of the Company. This document may include strategy discussions and forward-looking statements regarding the probable development of Ecopetro
Slide 3: Management Participants in Today's Conference Call
MANAGEMENT PARTICIPANTS IN TODAY’S CONFERENCE CALL • Javier Gutierrez, Chief Executive Officer • Adriana Echeverri, Chief Financial Officer • Nelson Navarrete, EVP of Exploration & Production • Alvaro Vargas, EVP of Growth and Strategy • Pedro Rosales, EVP of Downstream • Mauricio Echeverry, General
Slide 4: First Quarter 2009 Highlights
FIRST QUARTER 2009 HIGHLIGHTS • Oil and gas production increased 6.3%, in line with the objectives for the year • Successful execution of strategic plan, important strategic acquisitions amounting to more than USD 2.0 billion across all segments • Significant national and international E&P activity,
Slide 5: 2009 Strategic Goals
2009 STRATEGIC GOALS • Increase average production up to 457 MBOED during the year, reaching 500 MBOED in December • Execute the investment plan of USD 6.2 Billion • Create value for our shareholders within a difficult economic and business environment 5
Slide 6: 2009 Strategic Goals
2009 STRATEGIC GOALS • Increase average production up to 457 MBOED during the year, reaching 500 MBOED in December • Execute the investment plan of USD 6.2 Billion • Create value for our shareholders within a difficult economic and business environment 6
Slide 7: Growth in Production
GROWTH IN PRODUCTION Oil and gas production increased by 6.3%* in 1Q-09 Production (MBOED) 2003-2009 458 447 431 367 367 376 385 399 85 82 72 84 75 61 65 69 316 325 362 347 376 292 306 311 2003 2004 2005 2006 2007 2008 2008-1Q 2009-1Q Natural Gas Crude Oil Production (MBOED) First Quarter 2009 Jan-0
Slide 8: Refinery Operations
REFINERY OPERATIONS Refinery runs and utilization in Barrancabermeja Refinery (MBOD and Utilization %) 232 230 232 (93%) (93%) 228.5 227 (92%) 223 224 (97%) (91%) (89%) (90%) 213.4 (94%) 2003 2004 2005 2006 2007 2008 2008-1Q 2009-1Q Refining margin (USD/Bl)* Product breakdown – 1Q - 09 Barrancaberme
Slide 9: 2009 Strategic Goals
2009 STRATEGIC GOALS • Increase average production up to 457 MBOED during the year, reaching 500 MBOED in December • Execute the investment plan of USD 6.2 Billion • Create value for our shareholders within a difficult economic and business environment 9
Slide 10: Investment Plan 2009
INVESTMENT PLAN 2009 CAPEX Budget (USD bn) Projects by segment Progress in Q1 2009 Executed 1Q Plan 2009 • 1.000 seismic kilometers • Domestic exploration • 26 Blocks GoM (US) • International exploration in South • 2 Blocks in Peru– Petrobras 0.07 • Fuerte Norte and Fuerte Sur – BHP Billington Explo
Slide 11: Highlights of Investment Plan
HIGHLIGHTS OF INVESTMENT PLAN Local projects International projects E&P: Refining: GoM (US) Reficar 26 Blocks Transportation: Ocensa E&P: Hocol E&P: Fuerte Norte Fuerte Sur E&P: Petrobras Energía de Peru E&P: Petro -tech E&P: (Offshore ) Qüriyana - 1 11
Slide 12: Recent Acquisitions
RECENT ACQUISITIONS Closing Acquisition Overview Strategic importance Value date - Petro-tech Peruana Offshore 50/50 Partnership with - Offshore E & P (11 blocks) Feb-09 USD 450 mn (Jan-09) KNOC -12 MBOED production * E&P - 1P reserves of 85 MMBOE * Hocol 100% Acquisition - 15 MBOED Jun-09 USD 580 m
Slide 13: Strategic Acquisitions (1/2)
STRATEGIC ACQUISITIONS (1/2) Exploration & Production • Petro-Tech Peruana (Offshore International Group) > One of the largest oil and gas companies in Peru > Strongly positioned in offshore hydrocarbon exploration and production. > 11 Offshore blocks in Peru (1 production and 10 exploration), one o
Slide 14: Strategic Acquisitions (2/2)
STRATEGIC ACQUISITIONS (2/2) Refining • Refinería de Cartagena > Increases refining capacity according to the 2015 goal of 650.000 barrels > Potential synergies between the modernization processes of Barrancabermeja and Cartagena refineries Transportation • Ocensa > Main transportation infrastructur
Slide 15: 2009 Strategic Goals
2009 STRATEGIC GOALS • Increase the production up to 500 MBOED in December 2009 and produce an average of 457 MBOED during the year. • Execute the investment plan of USD 6.2 Billion • Create value for our shareholders within a difficult economic and business environment 15
Slide 16: Reference Prices
REFERENCE PRICES Prices 140 130 120 Falta calcular el promedio 110 de las canastas para el 100 1er Q 2008 para incluir en USD/Bl 90 los remarks 80 70 60 WTI Avg price 1Q 09 of USD 43.1/Bl 50 40 Basket of ECP exported products avg price for 1Q 09 09 of USD 33.1/Bl 30 Basket of ECP exported crude avg
Slide 17: Sale Volume Trends, Domestic & International
SALE VOLUME TRENDS, DOMESTIC & INTERNATIONAL Total Q1 sales increased by 16.2%. International sales accounted for 44.2%, up from 36.0% in 2008 Total sales volume (MBOED) 595.3 547 512.5 474 44.2% 448 462 420 433 36.0% 263.3 216 39.5% 184.5 148 31.2% 169 37.8% 174 37.7% 161 38.3% 171 39.5% 64.0% 55.8
Slide 18: Operating Results (1/2)
OPERATING RESULTS (1/2) Total revenues (COP Trillion) Operating costs and expenses (COP Trillion) 7.22 7.23 4.09 4.18 5.24 3.46 3.46 5.11 2008-1Q 2009-1Q 2008-1Q 2009-1Q 2008-1Q 2009-1Q 2008-1Q 2009-1Q Non Consolidated Non Consolidated Consolidated Consolidated Non Consolidated Non Consolidated Cons
Slide 19: Operating Results (2/2)
OPERATING RESULTS (2/2) Non operating revenues (COP Trillion) Net income(COP Trillion) 2.29 2.29 1.19 1.17 1.61 1.61 2008-1Q 2009-1Q 2008-1Q 2009-1Q 2008-1Q 2009-1Q 2008-1Q 2009-1Q Consolidated Consolidated Consolidated Consolidated -0.64 -0.64 EBITDA and EBITDA Margin (COP Trillion) EBITDA EBITDA M
Slide 20: Sales Evolution
SALES EVOLUTION Total sales (COP Trillion) 7.22 7.23 2.46 2.47 34.2% 34.1% 5.11 5.24 1.72 33.7% 1.82 34.7% 65.8% 4.76 65.9% 4.76 65.3% 3.39 66.3% 3.42 2008-1Q Non 2009-1Q Non 2008-1Q Consolidated 2009-1Q Consolidated Consolidated Consolidated Exports Local sales + services 20
Slide 21: Costs of Sales
COSTS OF SALES Cost of sales (COP Trillion) 3.68 3.76 3.15 3.15 1.09 1.17 31.1% 0.93 29.6% 0.93 29.5% 29.5% 68.9% 2.59 2.59 2.22 70.4% 2.22 70.5% 70.5% 2008-1Q 2009-1Q 2008-1Q 2009-1Q No Consolidated No Consolidated Consolidated Consolidated Fixed costs 21
Slide 22: Lifting, Refining and Transportation Costs
LIFTING, REFINING AND TRANSPORTATION COSTS Lifting costs (USD/BOE) 8.30 7.20 5.20 5.51 5.44 3.30 2005 2006 2007 2008 2008-1Q 2009-1Q Refining costs (USD/Bl) Transportation costs (USD cents/Bl-km)* 5.70 0.40 0.43 4.50 4.41 0.35 3.90 3.50 3.69 0.30 0.29 0.25 2005 2006 2007 2008 2008-1Q 2009-1Q 2005 20
Slide 23: SG&A Expenses
SG&A EXPENSES SG&A Expenses (COP Trillion) 0.41 0.42 0.31 0.31 0.32 0.32 76.2% 78.0% 0.24 77.4% 0.24 77.4% 23.8% 0.09 22.0% 22.6% 0.10 0.07 22.6% 0.07 2008-1Q 2009-1Q 2008-1Q 2009-1Q Non Consolidated Non Consolidated Consolidated Consolidated Commercialization and projects expenses Administration ex
Slide 24: Non Operating Results
NON OPERATING RESULTS 1Q 2009 consolidated (COP Trillion) 1Q 2009 non consolidated (COP Trillion) 0.11 0.11 0.20 0,20 0.25 0.20 1.87 1.82 3.20 3.15 1.17 1.22 Revenues Expenses Profit (Loss) Revenues Expenses Profit (Loss) 1Q 2008 consolidated (COP Trillion) 1Q 2008 non consolidated (COP Trillion) 0.
Slide 25: Segment Results
SEGMENT RESULTS Domestic sales (COP Trillion) International sales (COP trillion) 2.37 0.78 1.81 0.55 0.49 0.94 0.40 E&P Refining Transport Sales and Corporate E&P Refining Sales and Marketing marketing -2.22 2009-1Q 2009-1Q Operating income (COP Trillion) Net income(COP -Trillion) 0.93 0.76 0.58 0.1
Slide 26: Balance Sheet
BALANCE SHEET • Strong balance sheet and capacity to fund growth Balance Sheet Consolidated (COP Trillion) 14.08 28.9% 26.80 49.1% 21.3 44.3% 21.3 50.5% 48.7 54.53 19.37 59.3% 42.14 48.11 16.96 64.8% 17.96 64.2% 32.66 34.62 71.1% 26.19 27.96 26.81 55.7% 27.73 50.9% 20.84 49.5% 9.23 10.00 35.8% 13.29
Slide 27: 2009 Outlook
2009 OUTLOOK • Production average of 500 MBOED in December 2009 • Fully execute the investment plan for 2009 • Bond issuance in the capital markets 27