Otto Energy Limited · ASX:OEL
Otto Energy — Investor Presentation (December 2007)
38 slides from Otto Energy's investor presentation, December 2007
Slide 1: Investor Presentation December 2007
INVESTOR PRESENTATION DECEMBER 2007 ASX CODE : OEL
Slide 2: Disclaimer
2 DISCLAIMER • This presentation Thi t ti d does nott constitute tit t an offer ff tto sellll securities iti and d iis nott a solicitation li it ti off an offer to buy securities. It is not to be distributed to third parties without the consent of Otto Energy Ltd (the “Company”). • This presentation
Slide 3: Why Invest in Otto?
3 WHY INVEST IN OTTO? OTTO ENERGY LIMITED (OEL) HAS • A balanced E&P portfolio in proven oil and gas provinces • Executed a major transaction with the acquisition of a 18.28% beneficial interest in the Galoc oil field – with first oil production due in April 2008 CASH FLOW EXPECTED FROM THREE PROJEC
Slide 4: Corporate Board
CORPORATE BOARD RICK CRABB RUFINO BOMASANG JAAP POLL IAN MACLIVER JOHN JETTER CHAIRMAN DIRECTOR DIRECTOR DIRECTOR DIRECTOR (NON - EXECUTIVE) (NON - EXECUTIVE) (NON - EXECUTIVE) (NON - EXECUTIVE) (NON – EXECUTIVE) B JURIS (HONS) LLB NORASIAN CHAIRMAN PHD PHILOSOPHY AND MBA GEOLOGY Mr Rick Crabb holds
Slide 5: Corporate Executives
5 CORPORATE EXECUTIVES ALEX PARKS CRAIG MARTIN BRUCE ELSHOLZ EMMA MCCORMACK KRIS FELLOWS CHIEF EXECUTIVE CHIEF OPERATIONS CHIEF FINANCIAL COMPANY SECRETARY CHIEF EXECUTIVE OFFICER OFFICER OFFICER OFFICER-NORASIAN Mr Alex Parks has a Mr Craig Martin has over Mr Bruce Elzholz has been Emma McCormack i
Slide 6: Capital Structure
6 CAPITAL STRUCTURE ISSUED 437,812,325* ~22,450,000** 2,500,000 MARKET CAP A$151m @ 0.345 cps CASH A$28m*** and Galoc debt of ~ A$24 million ((14 DECEMBER 2007)) OTTO’S OTTO S MARKET CAP HAS INCREASED FROM A$20M TO ~ A$151M IN THE LAST 12 MONTHS N t Note: • Not included: 2m shares to project vendors
Slide 7: Corporate Structure
7 CORPORATE STRUCTURE Otto Energy ASX Listed Australian Public Company (ASX - OEL) 100% 32 48% (Option 32.48% O ti t 41.24%) to 41 24%) 100% 100% Edirne Cynthia “New Co” 100% NorAsian (Turkish Comp.) (BVI Comp.) (Italian Comp) (Bermuda Comp) Turkey Argentina g Italy y Philippines 100% 100% Thrace Ba
Slide 8: Current Areas of Interest
8 CURRENT AREAS OF INTEREST NON-OPERATED OPERATED ITALY Onshore Gas in Po Valley Licences TURKEY PHILIPPINES Onshore Gas in Thrace Off h Offshore Oil & Gas G ini Basin Licences Philippine Licences ARGENTINA Onshore Oil Exploration in Argentina / Santa PERTH, Rosa Block AUSTRALIA Corporate office • O
Slide 9: The Philippines: Otto's Project Locations
9 THE PHILIPPINES OTTO OTTO’S S PROJECT LOCATIONS SC14 C Galoc SATELLITE PHOTO PHILIPPINES OTTO LICENCE MAP OF PHILIPPINES
Slide 10: Why Explore in the Philippines?
10 WHY EXPLORE IN THE PHILIPPINES? • The Philippines pp has numerous p proven hydrocarbon y basins • The offshore areas are under explored with less than 100 exploration wells drilled offshore. • 40 discoveries and 11 commercial fields offshore • The fiscal regime is one of the best in Asia with str
Slide 11: Otto's Philippines Acreage
11 OTTO’S OTTO S PHILIPPINES ACREAGE SC14C GALOC OIL FIELD (OTTO 18.28%) • Under U d development d l t with ith first fi t oilil expected t dAAprilil 2008 2008. Gross G 2P Reserves R of 23 MMbbls SC50 (OTTO 98%) • Calauit Oil Field: under appraisal with initial oil sales expected late 2008. Gross 2P
Slide 12: Non Operated Assets Summary
12 NON OPERATED ASSETS SUMMARY Otto has exposure to three non-operated onshore projects areas, providing low risk incremental growth to the portfolio, portfolio low maintenance, maintenance regular exploration drilling, drilling and stable future income from onshore gas production TURKEY • Very low
Slide 13: Project Details
13 PROJECT DETAILS NON-OPERATED NON OPERATED OPERATED PHILIPPINES Offshore Oil & Gas in ITALY Philippine Licences Onshore Gas in Po Valley Licences •SC14C Galoc Field- 18.28%% TURKEY •SC50 - 98% Onshore Gas in Thrace •SC51 - 80% Basin Licences •SC55 – 85% •AREA AREA 8 – 70% ARGENTINA Onshore Oil Exp
Slide 14: Galoc SC14 C
14 GALOC SC14 C Otto has an 18.28% net revenue interest in the Galoc oil field through acquisition of a 32% shareholding in a dedicated Joint Venture company, Galoc Production Company (GPC) Galoc Location Galoc Location • GPC iis th the fi field ld operator t • GPC has debt finance already in place
Slide 15: Galoc / SC14 C Working Interests
15 GALOC / SC14 C WORKING INTERESTS COMPANY % Galoc Production Company (“GPC”) 58.29% - Vitol (68.62% of GPC) - 40.01% - Otto Energy (31.38% of GPC) * - 18.28% Nido Petroleum Limited 22.28% Oriental/LOGPOCOR 7.58% Philodrill Corporation 7.02% Forum Energy 2.27% Alcorn Gold Resources 1 53% 1.53% Petr
Slide 16: Galoc Oil Field
16 GALOC OIL FIELD GCA CERTIFIED GROSS RESERVES FOR GALOC 1st Phase 2nd Phase 1P 99.7 7 MM MMstb tb 3P 41 41.9 9 MMstb MM tb 2P 23.5 MMstb Images from Nido website
Slide 17: Value of 18.28% of Galoc to Otto
17 VALUE OF 18 18.28% 28% OF GALOC TO OTTO • Acquisition A i iti costt off ~A$45 A$45 million illi + cash hb bond d on ddeposit it off A$14 A$14.5 5 million illi ffor fully financed project to first production in April 2008. • Whole deal NPV10 to Otto of ~A$54 million (post tax) for 2P reserves at U
Slide 18: SC50 – Calauit Oil Field
18 SC50 – CALAUIT OIL FIELD 2007 3D SEISMIC TO DELINEATE CALAUIT AND OPTIMIZE DEVELOPMENT DRILLING CALAUIT SC50, SHOWING REGIONAL • Green Area = Calauit & Calauit South • Pink Area = Possible field extent OIL & GAS FAIRWAY • Blue Dotted = Further small leads
Slide 19: SC50 - Calauit Oil Field
19 SC50 - CALAUIT OIL FIELD Otto has a 98% beneficial interest 3D seismic was shot byy Otto in June 2007,to , better delineate the field and plan for appraisal drilling in 2008. CALAUIT “EARLY PRODUCTION SYSTEM” • Pre-3D P 3D seismic i i estimates ti t are Calauit STOIIP ~ 40m bbls Rec. reserves ~ 6
Slide 20: SC51 – Summary
20 SC51 – SUMMARY SC51 • Water depths generally < 300m • Already contains one gas discovery • Has both on and offshore potential with variety of oil and gas plays • Cebu market is hungry for energy 3D SEISMIC COMPLETED JUNE 2007 EAST VISAYAN BASIN SC51 - LICENCE LOCATION MAP
Slide 21: SC51 Southern Block with >100 MMbbls Targets
21 SC51 SOUTHERN BLOCK WITH >100 MMBBLS TARGETS AVO ANOMALIES SUGGEST POSSIBLE GAS ON OIL…. POTENTIALLY UP TO 270M BBLS RECOVERABLE POTENTIALLY UP TO 145M BBLS RECOVERABLE E-W SECTION OVER ARGAO AND CABILAO WITH AMPLITUDE ANOMALIES (“HYDROCARBON INDICATORS”)
Slide 22: Area 8 – Preferred Bidder
22 AREA 8 – PREFERRED BIDDER OTTO HAS BEEN SELECTED AS THE PREFERRED BIDDER FOR AREA 8 Leads and Prospects • Area 8 lies between Cebu & Bohol. The area consists of 7,440km2. There is approximately 3,000km of existing 2D seismic covering the area • The area is considered highly prospective with over
Slide 23: SC55 "Elephant Country"
23 SC55 “ELEPHANT ELEPHANT COUNTRY” COUNTRY DEEP WATER BLOCK WITH MASSIVE POTENTIAL • Area of 9,000km2 • Never previously licensed as an Exploration Permit • Massive Reef and Turbidite potential OTTO HAS ACQUIRED 2D SEISMIC IN TWO SURVEYS • 400km of prospect specific in Oct 2006 • 963km of regional
Slide 24: Giant Marantao Reef Prospect
24 SC 55 GIANT MARANTAO REEF PROSPECT Deep Water Licence (Potentially 5 x Malampaya Size) with amplitude anomalies and seabed oil and gas seeps Shell/Conoco Sh ll/C Phillips oil discovery MARANTAO MALAMPAYA (AT SAME SCALE)
Slide 25: Marantao Volumetric Scenarios
25 MARANTAO VOLUMETRIC SCENARIOS Base Case 50m Oil with Gas Cap (Malampaya has a 56m oil column) P90 P50 P10 MEAN GIP ((BCF)) 724 2,311 5,367 2,746 OIP (MMBBLS) 379 1,193 2,773 1,416 REC. GAS (BCF) 468 1,508 3,602 1,812 REC OIL (MMBBLS) REC. 144 469 1 118 1,118 567 OIL ONLY AND GAS P90 P50 P10 MEAN
Slide 26: Non Operated Assets Summary
26 NON OPERATED ASSETS SUMMARY Otto has exposure to three non-operated onshore projects areas, providing low risk incremental growth to the portfolio, portfolio low maintenance, maintenance regular exploration drilling, drilling and stable future income from onshore gas production TURKEY • Very low
Slide 27: Turkey Project Location
27 TURKEY PROJECT LOCATION SATELLITE PHOTO WESTERN TURKEY & LICENCE LOCATION THRACE BASIN AND INFRASTRUCTURE OF THE THRACE BASIN
Slide 28: Turkey
28 TURKEY THREE GAS DISCOVERIES • First production expected late 2008 top tier gas price at US$8-10/Mscf + Revenues: Initially US$3m/year, targeting US$10m/year within 18 months th assuming i ffurther th discoveries di i • Strong farm-in partner with operating experience in Turkey • Incremental Petr
Slide 29: Provisional Prospects from New 3D Program
29 PROVISIONAL PROSPECTS FROM NEW 3D Ortakci Kavakli Yagci Karabas PROGRAM Kuzey y Kuzey y Suloglu g • 5 wells ll starting t ti iin Feb 2008 Kuzey Koyustu Koyustu • Development mid Gerdelli 2008 Kuzey Suloglu Arpaci • First gas sales late Bati Umur 2008 Urun Di Discovery Prospect
Slide 30: Italy Basiglia-Cento Permits, Po Valley
30 ITALY BASIGLIA- CENTO PERMITS, PERMITS PO VALLEY SATELLITE PHOTO ITALY SHOWING PO LICENCE LOCATION VALLEY REGION AND INFRASTRUCTURE OF THE PO VALLEY BASIN
Slide 31: Italy Project Details
31 ITALY PROJECT DETAILS Gas Field Gazzata Oil Field • Operated by Ascent Resources • Otto farming in for 50% • First well Gazzata-1 drilling in S t b 2008 September • Funded from existing capital and Galoc revenues • Gazzata alone could be NPV of A$200 million to Otto Rubiera Multiple Gas Fields Ga
Slide 32: Italy Project Details
32 ITALY PROJECT DETAILS GAZZATA PROSPECT POTENTIALLY >130 BSCF RESOURCES • Numerous Prospects • Good G d local l l pipeline i li • Gas/Water infrastructure over Contact ? permits • European gas prices >$10 /Mscf “HAMPSON RUSSELL” PROCESSING - ALL LINES SHOW AVO TERMINATING AT THE SAME TIME/DEPTH -
Slide 33: Argentina Project Overview
33 ARGENTINA PROJECT OVERVIEW OTTO ACQUIRES 32.48% IN 1 BILLION BARREL OIP O POTENTIAL SANTA ROSA DOME
Slide 34: Argentina – Cuyana Basin
34 ARGENTINA – CUYANA BASIN Otto agreed g to farm-in on the Santa Rosa Licence • Otto earns 32.48% from Oromin by spending US$1.4 million • Otto has option to increase to 41.24% for a further US$900,000 The Santa Rosa block contains the giant Santa Rosa Dome with potentially up to 1 billion bbls of
Slide 35: Cuyana Basin and Santa Rosa Dome
35 CUYANA BASIN AND SANTA ROSA DOME E-W E W profile fil showing h i oil il fields fi ld in i western t partt off basin, b i source beds b d in i basin b i centre and likely migration paths eastwards towards the Santa Rosa Dome
Slide 36: The Potential Impact of Success
36 THE POTENTIAL IMPACT OF SUCCESS Philippines • Galoc and Calauit are worth > 27c per share and > A$70million net cash in 2008. • Argao potentially up to 270 million bbls recoverable (Otto 80%) (~$2 per share at 40% working intrest) • M Marantao t – has h huge h potential t ti l with ith 2P Resourc
Slide 37: Prognosis of Upcoming News and Activities
37 PROGNOSIS OF UPCOMING NEWS AND ACTIVITIES • Drilling of Galoc Development wells • Award of Argentina • Drilling g in Turkey y starting g Feb 08 - five wells • Commence production at Galoc by April 08 1ST CASH FLOW $30 – 60 MILLION / YEAR • Farm-out Farm out of Philippines Projects H1 2008 • Drill
Slide 38: Finally in Summary
38 FINALLY IN SUMMARY • Otto is a dynamic company with significant growth potential • Ott Otto has h a strong t board b d and d managementt team t to t oversee the th growth from explorer to producer and junior to mid-cap • The Galoc acquisition means Otto is now funded to maintain high equity posit