Serica Energy PLC · LSE:SQZ
Serica Energy — Non-Deal Roadshow (November 2011)
41 slides from Serica Energy's roadshow presentation, November 2011
Slide 1: A Company in transition with major potential
Serica Energy plc A Company in transition with major potential Shareholder presentation - November 2011
Slide 2: Disclaimer
Serica Energy plc Disclaimer ● The information presented herein is subject to amendment and has not been independently verified. Serica does not represent that the information and opinions contained herein are necessarily adequate or accurate and no liability is accepted for any errors or omissions.
Slide 3: Presentation Agenda
Serica Energy plc Presentation Agenda 1. Company overview - business units 2. Core assets & core values • North Sea - Columbus, Bream, Cash • Indonesia - Kambuna 3. Exploration assets & value potential • North Sea • Ireland, Morocco, Namibia 4. Extracting value - forward strategy 5. Summary and Conc
Slide 4: Major changes in underlying asset portfolio
Serica Energy plc Major changes in underlying asset portfolio: During the past three months Serica has: • Sold its Indonesian exploration properties and operating subsidiaries • Accessed highly prospective Atlantic Margin Blocks • Increased its cash position to c.US$18.5 million @ 30/9 with no debt
Slide 5: Highly experienced management team
Serica Energy plc Highly experienced management team Skills and experience • Technically driven with one of the most experienced Boards in the sector • Financially competent with one of the best farm-out records in the sector • Operationally strong having drilled 17 exploration and appraisal wells o
Slide 6: Full range of assets
Serica Energy plc Full range of assets Assets at every stage of maturity Production - Kambuna platform A 25% interest in the producing Kambuna gas/gas condensate field offshore North Sumatra in Indonesia Development - A 50% interest in Block 23/16f in Central North Sea containing part of Columbus ga
Slide 7: Exploration, Development & Production - all phases
Serica Energy plc Exploration, Development & Production - all phases Can be divided into three distinct Business Units North Sea business unit Development & Exploration Three distinct business units Atlantic margin prospects each with High Impact drilling strong underlying value Production in Indone
Slide 8: Identifying and unlocking value
Serica Energy plc Identifying and unlocking value Each business unit has clear underlying potential and value Ireland North Sea Morocco Indonesia Namibia ✦Cash ✦World Class ✦Kambuna ✦Columbus ✦Deep Water ✦Cash Flow ✦Bream ✦Highly sought ✦Tax position ✦Major Upside ✦UK upside Strategic objective is t
Slide 9: Presentation Agenda
Serica Energy plc Presentation Agenda 1. Company overview - business units 2. Core assets & core values • North Sea - Columbus, Bream, Cash • Indonesia - Kambuna 3. Exploration assets & value potential • North Sea • Ireland, Morocco, Namibia 4. Extracting value - forward strategy 5. Summary and Conc
Slide 10: North Sea Business unit - Core tangible assets
Serica Energy plc North Sea Business unit - Core tangible assets Two fields awaiting development Columbus Field • Operator of Columbus field with 50% of Block 23/16f • Columbus (c.19 mmboe) planned sanction 1Q2012 Bream Field • Economic interest in Bream field in Norway • Bream (c.50 mmbbls) awaits
Slide 11: Columbus field development
Serica Energy plc Columbus field development Columbus production planned for 2014 • Independent experts attribute Serica's share of reserves at 6.3 million barrels of oil equivalent • Negotiations for cost sharing and tariffing for use of adjacent Lomond platform complete • Negotiations with BG to d
Slide 12: Columbus field development
Serica Energy plc Columbus field development Prior to project sanction the following is required • Agreement with BG on reserves lying in Blocks 23/16f & 23/21 will permit financing discussions to start • Financing for field development - Serica's share approx £50 million • Options for financing inc
Slide 13: Bream field
Serica Energy plc Bream field Serica has a valuable economic interest in the Bream field, Norway • Serica sold its interest in the Bream field in 2008. Substantial cash consideration is due to Serica on field start-up • Bream recoverable reserves approx 50 mmbbls Gardrofa • FPSO under review by Brea
Slide 14: North Sea Core Assets
Serica Energy plc North Sea Core Assets Value apportionment excluding exploration potential Bream (risked) Columbus (risked) Tax offset North Sea core (reserves+cash) only Cash 60 Market 45 Assumptions used Big discount to North Sea • Oil $100/bbl real core NAV 30 Use of tax losses • Gas 50p/th real
Slide 15: Indonesia production - Kambuna field
Serica Energy plc Indonesia production - Kambuna field The Kambuna field is Serica's sole remaining asset in Indonesia • Serica has a 25% interest in the field • Field produces gas and gas condensate • Asset is a cash generator (US$6.6 million revenue in 3Q11) but is now a field in decline • Asset h
Slide 16: North Sea Core Assets plus Indonesia production
Serica Energy plc North Sea Core Assets plus Indonesia production Value apportionment excluding exploration potential Bream (risked) Columbus (risked) Kambuna North Sea Core + Kambuna 100 Tax offset Cash Market 75 Discount even greater when Kambuna is 50 included 25 Serica 0 Market quote North Sea c
Slide 17: Presentation Agenda
Serica Energy plc Presentation Agenda 1. Company overview - business units 2. Core assets & core values • North Sea - Columbus, Bream, Cash • Indonesia - Kambuna 3. Exploration assets & value potential • North Sea • Ireland, Morocco, Namibia 4. Extracting value - forward strategy 5. Summary and Conc
Slide 18: UK Exploration programme
Serica Energy plc UK Exploration programme Serica plans to drill three wells during 2012 • Spaniards well is planned for late 2012 • Objective to drill Doyle and one of South Otter prospects during year • Discussions in hand with potential for farm-out or acreage exchange • Company awaits the award
Slide 19: UK - Spaniards appraisal
Serica Energy plc UK - Spaniards appraisal Spaniards - blocks 15/21a & 15/21g • Serica has 30% of Block 15/21g • Spaniards proven by 15/21a-38z & 15/21-2 with well 15/21a-38z flowing 2,600 bpd on test • Agreement to amalgamate with Block 15/21a - Serica interest in amalgamated area 21% • Serica shar
Slide 20: UK - South Otter prospects
Serica Energy plc UK - South Otter prospects South Otter - Blocks 210/19a & 20a • Serica has 100% of Blocks 210/19a & 20a • Blocks lie adjacent to Otter field • Several prospects lie in the blocks. • Serica will be reducing its interest through farm-down or acreage swap • It is planned to drill one
Slide 21: UK - Doyle prospect
Serica Energy plc UK - Doyle prospect Doyle - Blocks 113/26b & 27c • Serica is Operator of Blocks113/26b & 27c with 65% and plans to drill in 2012 • Doyle located on trend with North Morecambe & South Morecambe fields & recent Rhyl gas discovery • Geologically unrelated to the Conan well drilled by
Slide 22: Atlantic Margin properties
Serica Energy plc Atlantic Margin properties Serica has established a strong position in Atlantic margin • Atlantic margin is emerging as new hydrocarbon exploration area • Serica has built significant position in four Atlantic margin Basins • Rockall & Slyne Basins - Ireland • Tarfaya-Ifni Basin -
Slide 23: Ireland Atlantic margin
Serica Energy plc Ireland Atlantic margin Good position offshore Ireland • Serica has large interests in two Atlantic margin basins offshore Ireland • The Rockall Basin has a working hydrocarbon system proven by Shell's Dooish discovery • The Slyne Basin has a working hydrocarbon system proven by Se
Slide 24: Ireland exploration: Rockall Basin
Serica Energy plc Ireland exploration Rockall Basin - Serica 100% • Three large undrilled prospects, Muckish, Midleton & West Midleton • All three show features analogous to the nearby Dooish discovery • Dooish encountered 216m gas condensate column • Dooish established working hydrocarbon system in
Slide 25: Rockall Basin - Muckish prospect
Serica Energy plc Rockall Basin - Muckish prospect South-west North-east seismic line through Muckish prospect SW Muckish (North) Muckish East NE Muckish has potential for very large volumes to be trapped
Slide 26: Ireland exploration: Slyne Basin
Serica Energy plc Ireland exploration Slyne Basin - Serica 50% (Operator) • Serica drilled well 27/4-1 in 2009 and found shallow oil at Bandon prospect • This established presence of working hydrocarbon system • Proves deeper oil potential of Jurassic in basin • Boyne & Liffey are Lower Jurassic oil
Slide 27: Slyne Basin - Boyne prospect
Serica Energy plc Slyne Basin - Boyne prospect West-east seismic line through Boyne prospect Boyne & Liffey have prospect for both oil and gas trapping
Slide 28: Morocco - Tarfaya-Ifni Basin licences
Serica Energy plc Morocco - Tarfaya-Ifni Basin licences Two large blocks offshore Morocco • Serica has 25% interest in Foum Draa and Sidi Moussa Blocks in the Tarfaya-Ifni Basin • Highly under-explored: only three wells drilled in the Central Moroccan deepwater Atlantic Margin • Water depths in Seri
Slide 29: Morocco - Foum Draa and Sidi Moussa licences
Serica Energy plc Morocco - Foum Draa and Sidi Moussa licences Multi-prospect blocks • Blocks cover 12,714 square kilometres • Extensive technical evaluation of 5,260 kilometres of 3D seismic data undertaken • 33 prospects & leads identified • Diverse range of play types & multiple reservoir objecti
Slide 30: Namibia - Luderitz Basin licences
Serica Energy plc Namibia - Luderitz Basin licences Large new award in Namibia • Licence award was announced by the Namibian Ministry of Mines and Energy in early November 2011 • Blocks cover approximately 17,400 square kilometres in central Luderitz Basin • Serica is Operator with 85% interest • Bl
Slide 31: Namibia - Luderitz Basin Geological setting
Serica Energy plc Namibia - Luderitz Basin Geological setting Namibia offshore largely unexplored Kunene gas discovery • The Luderitz Basin is one of three under- explored sedimentary basins lying south of the Walvis Ridge offshore Namibia • Water depths in the area awarded range from 300 to 3,000 m
Slide 32: Namibia - Luderitz Basin licences: very large prospects
Serica Energy plc Namibia - Luderitz Basin licences Very large prospects • The Blocks contain all the ingredients for the presence of World Class accumulations • Three very large four-way dip closure structures are identified on the blocks • Sizeable trapping mechanisms are also expected to be prese
Slide 33: Presentation Agenda
Serica Energy plc Presentation Agenda 1. Company overview - business units 2. Core assets & core values • North Sea - Columbus, Bream, Cash • Indonesia - Kambuna 3. Exploration assets & value potential • North Sea • Ireland, Morocco, Namibia 4. Extracting value - forward strategy 5. Summary and Conc
Slide 34: Sum of parts valuation
Serica Energy plc Sum of parts valuation Each of Serica's business units can be valued separately North Sea business unit More than supports Company value on Development & Exploration its own Atlantic margin prospects Large potential attracting interest of High Impact drilling majors Production in I
Slide 35: Prospect inventory across business units
Serica Energy plc Prospect inventory across business units Exploration acreage contains many high potential prospects Area Prospects Potential (*) Doyle, Spaniards, UK ~40 mmbboe South Otter Muckish, Midleton, Ireland ~250 mmbboe Boyne, Liffey Multiple High Impact Morocco ~120 mmbboe Prospects Multi
Slide 36: Peer Group Exploration comparative
Serica Energy plc Peer Group Exploration comparative Serica's exploration acreage is given no value in any of its areas Example - Namibian acreage offers obvious peer group comparative Comparative Chariot Serica Acreage Acreage held ~30,000 ~17,400 ( sq. kms) Source: Value given by $265.5 million Ne
Slide 37: Strategy Implementation to realise value and potential
Serica Energy plc Strategy Implementation to realise value and potential The Company's current objective is to • Demonstrate the value and potential of its assets, particularly its North Sea assets, through acquisition, consolidation or sale • Continue its policy of risk management through industry
Slide 38: Presentation Agenda
Serica Energy plc Presentation Agenda 1. Company overview - business units 2. Core assets & core values • North Sea - Columbus, Bream, Cash • Indonesia - Kambuna 3. Exploration assets & value potential • North Sea • Ireland, Morocco, Namibia 4. Extracting value - forward strategy 5. Summary and Conc
Slide 39: Share performance catalysts
Serica Energy plc Share performance catalysts Step change value creation is planned & taking place Q4 2011 Q1 2012 Q2 2012 Q3 2012 • Indonesia sale • Columbus • South Otter • Rockall Basin sanction farm out farm out • Ireland award • Realise UK • Doyle farm out value • South Otter drill • Namibia aw
Slide 40: Financial capacity
Serica Energy plc Financial capacity At 30/9 Serica had US$18.5m cash, revenue, no debt & undrawn US$50m facility New Near Term Events Spin-off partners Columbus development 0 0 0 Proposals under review Discussions underway Namibia Luderitz exploration 0 0 with interested parties Farm out proposals U
Slide 41: Conclusion
Serica Energy plc Conclusion Serica is significantly undervalued and has a number of step change events in hand to realise greater shareholder value Kambuna wellhead tower before deck installation