2012 07 Rockhopper Roadshow Presentation

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Transcript of 2012 07 Rockhopper Roadshow Presentation

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    ROCKHOPPEREXPLORATIONPLC

    INVESTORUPDATE

    JULY/AUGUST2012

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    ROCKHOPPEREXPLORATION

    OPENINGANEWOILPROVINCE

    3

    ContingentResources(mmbbls)

    NettoRockhopper (2)

    1C 2C 3C90.2 142.2 206.4

    RockhopperholdslicencesintheNorthFalklandBasin

    Tenwelldrillingcampaign20102012

    70%successrate

    Significantupsideremains

    Grossbestunriskedprospective

    resources

    of

    approx.

    3.3

    bnbbls(1)

    ____________________(1) Note: aggregated by Rockhopper Exploration Plc. Gross best unrisked resources include 372 mmbbl for prospects and 674 mmbbl for leads per 2012 GCA CPR. Additionally, 152 mmbbl for the Weddell lead is

    included per 2009 RPS CPR as well as further leads with 2,138 mmbbl as per 2007 Rockhopper estimates.(2) GCA CPR resources net to Rockhopper post farm-out.

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    DETAILEDACREAGEPOSITION

    POSTFARMOUT SUBJECTTOREGULATORYANDPARTNERAPPROVALS

    4

    Licence RKH Interest

    PL032 40%

    PL033 40%

    PL023 40%

    PL024 40%

    PL003 3%

    PL004a 3%

    PL004b 24%

    PL004c 10%

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    ATRANSFORMATIONALDEALFORROCKHOPPER

    5

    A Global

    Competitive

    Auction Completed

    Rockhopper, Bank of America Merrill Lynch and Rothschild approached global audienceincluding independents, IOCs and NOCs

    Disciplined process with international parties from three continents conducting detailed due

    diligence

    Intense negotiations with a short list of parties prior to announcement

    The Right

    Deal

    Established and secured the best terms offered by the industry

    Rockhopper retained material 40% equity stake in Sea Lion and exposure to future upside

    Is fully funded for the Sea Lion development with an optional full field standby funding

    Carried for US$120mm (gross) of further exploration, equivalent to three wells

    The Right Partner

    Premier Oil is a proven operator with experience of FPSO developments and waxy oil

    Recent experience delivering analogue developments on time and on budget Premier Oil to make significant commitment to the project with c. US$330-350mm pre-FID

    (incl. upfront consideration, expected FEED costs and excluding exploration)

    Financial strength to bring Sea Lion to first oil; approx. US$2bn after tax cash flows per annum

    by 2015/2016 (1)

    The Best Platform

    Going Forward

    Fully funded Sea Lion development to deliver exciting production growth

    A partnership to pursue North Falkland Basin exploration

    AMI covering highly prospective, geologically analogous, exploration

    Significant cash to pursue new ventures and a team with track record of creating value

    Joint capital markets day scheduled post closing of the farm-out transaction____________________(1) Premier Oil public disclosure.

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    TERMSOFTHEFARMOUT AQUICKREPRISE

    6

    The Financial

    Terms of

    the Farm-out

    Upfront cash payable on completion:

    Net development funding / carry from 1 April 2012:

    Net exploration carry:

    Optional standby funding arrangement:

    US$231mm

    US$722mm

    US$48mm

    US$ full field funding

    Conditions

    Precedent (Exp. to

    be Satisfied by 30

    September 2012)

    Consent of the Falkland Islands Government

    Consent from existing licence partner

    Other Features of

    the Farm-out:

    Costs of Front End Engineering and Design (FEED) expected to be around US$100mm to be covered

    within development funding / carry Rockhopper to be sub-surface lead on exploration

    Area of Mutual Interest (AMI) signed to cover North Falkland Basin as well as Southern Mozambique,

    South Africa & Namibia

    Operator handover agreement

    This process has already begun and is expected to have concluded by 31 October 2012

    Agreement to undertake a FEED study targeting:

    Field Development Plan (FDP): H1 2014

    First oil: H1 2017

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    FARMOUTCLOSESTHEVALUEGAPANDDERISKSTHEPROJECT

    7

    ____________________(1) Note: aggregated by Rockhopper Exploration Plc. Risked and risked and unrisked NPV10 post-tax economic evaluation of Sea Lion and adj. discoveries (net to Rockhopper) as of 31 March 2012 respectively - based on GCA CPR.

    Note, economic evaluation in GCA CPR assumes first oil date of 1stJanuary 2016.(2) FactSet as of 11 July 2012, based on 284.2mm shares outstanding and net cash of US$107mm as of 31 March 2012.(3) Note: aggregated by Rockhopper Exploration Plc. Rockhoppers 40% share of risked and unrisked net NPV10 post-tax economic evaluation, as of 31 March 2012, based on GCA CPR. NPV of the development funding / carry per

    Premier Oil disclosure, using 10% discount rate as of 31 March 2012. Cash consideration per deal terms. Analysis based on Rockhopper estimates. Note, economic evaluation in GCA CPR assumes first oil date of 1stJanuary 2016.

    InadditiontoSeaLionandadjacentdiscoveries,therearenumerousprospectsandleads,withinRockhoppersacreage,withgrossbestunriskedresourcepotentialofapprox.3.3bnbbl.Per dealterms,Rockhopperisfundedforthreeexplorationwells

    Post-deal: Highly Value Accretive Farm-out

    1,104

    -

    $500

    $1,000

    $1,500

    $2,000

    $2,500

    $3,000

    2,399

    2,640

    US$mm

    100%+ Value

    Accretion for

    RockhopperShareholders

    Sea Lion + Adj.Discoveries

    GCA Economic

    Evaluation(40%)

    Upfront CashConsideration

    Upfront CashConsideration

    NPV (10%) ofNet DevelopmentFunding / Carry

    Sea Lion + Adj.

    DiscoveriesGCA Economic

    Evaluation(40%)

    NPV (10%) ofNet DevelopmentFunding / Carry

    RockhopperPre-deal

    EnterpriseValue (2)

    GCA RiskedEcon. Evaluation

    (40%) + Cash and NPVof Devt Funding (3)

    GCA UnriskedEcon. Evaluation

    (40%) + Cash and NPVof Devt Funding (3)

    FurtherExploration

    Upside

    3.1 18.616.9

    GCAprepared

    economic

    evaluation

    to

    derive

    NetPresentValues(NPVs)forSeaLionand

    adjacentdiscoveriesofUS$4.1billion(risked)

    andUS$4.7billion(unrisked)onagrossbasis(1)

    Thiseconomicevaluationispredicatedonaprojectbeingfullyfunded

    TheeconomicevaluationrepresentsriskedandunriskedmultiplesofUS$11.6/bbland

    US$13.3/bblrespectively

    Thefarmouttransactionishighlyaccretivetotheshareholders:thisprojectisnowfully

    funded

    and

    Rockhopper

    benefits

    from

    upfront

    cashanddevelopmentfunding/carry

    Postfarmout,theresultingriskedandunriskedUS$/bblmultiplesare

    US$16.9/bblandUS$18.6/bblrespectively

    US$/bblMultiple

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    Multiple 2D, 3D seismic programmes

    10 operated wells

    2 drill stem tests (DST) and 15 mini DSTs

    Static and dynamic reservoir models in place

    >20,000 man-hours of completed concept selectionpre-FEED engineering across full project

    FPSO selected as development case

    Data from appraisal fully integrated

    Wax management solutions in place

    Peak production

    Sea Lion c. 80,000 bbls per day

    Upside from Satellites

    SEALION:WELLAPPRAISEDANDREADYFORDEVELOPMENT

    8

    Wellappraisedandunderstoodreservoir

    Developmentconceptandtechnicalsolutionsinplace

    Extensive Work Completed Schedule To First Oil

    Indicative Sea Lion

    Development Costs

    -

    $1,000

    $2,000

    $3,000

    $4,000

    $5,000

    FEED

    Pre-First OilDevelopment

    Post-First OilDevelopment

    FDP

    (H12014) FirstOil(H12017)

    FEED

    Pre-First OilDevelopment

    Post-First OilDevelopment

    FDP

    (H12014) FirstOil(H12017)

    US$mm

    FEED

    Post-FirstOil

    PotentialFPSO

    Pre-FirstOil

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    SIGNIFICANTUPSIDEREMAINSINNORTHFALKLANDBASIN

    9

    Rockhoppertotakesubsurfaceleadinexploration

    RockhopperhasstrongunderstandingoftheNorthFalklandBasinfollowingitshighlysuccessfuldrillingcampaignwith70%

    successrate

    Appraisalofexistingdiscoveries(Casper,CasperSouth,Beverley)

    andexploration

    of

    additional

    prospects

    Multipleattractiveoilprospectswith>20%GCoS

    Chatham&GeorgeProspectsdrillreadywithcombinedgrossunriskedprospectiveresourcesof500mmbbls(HighCase),

    237mmbbls(Best

    Case)

    (1)

    Technicalworkcontinuestoidentifyandmatureleadsandprospects

    ____________________(1) Note: resources aggregated by Rockhopper Exploration Plc.(2) Source: GCA CPR, RPS and Rockhopper estimates. Gross best unrisked resources include 372 mmbbl for prospects and 674 mmbbl for leads

    per 2012 GCA CPR. Additionally, 152 mmbbl for the Weddell lead is included per 2009 RPS CPR as well as further leads with 2,138 mmbbl asper 2007 Rockhopper estimates.

    TotalProspectiveResourcesPostFarmOut(1,2)Prospects

    (mmbbls)

    Leads

    (mmbbls)

    Total

    (mmbbls)

    GrossBestUnriskedProspectiveResources 372 2,964 3,336

    NetBestUnriskedProspectiveResources 143 1,186 1,328

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