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DisclaimerNOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, CANADA, JAPAN, OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO.
This document is the sole responsibility of, and has been prepared and issued by, Phoenix Global Resources plc (“Phoenix”). For the purposes of this notice, the presentation that follows (the “Presentation”) shall include the slides that follow, hard copies of this document and any materials issued in connection with the presentation.
The information contained in this Presentation is subject to verification, completion and amendment even if information presented has been sourced from publicly available information.
This Presentation does not comprise an admission document, listing particulars or a prospectus relating to Phoenix or any subsidiary of Phoenix, does not constitute an offer invitation or recommendation to purchase or subscribe for any securities of Phoenix or any of the business or assets described herein, and should not be relied on in connection with a decision to purchase or subscribe for any such securities. This Presentation has not been independently verified by Stockdale Securities Limited (the “Nomad”).
No reliance may be placed for any purpose, whatsoever on the information contained in the Presentation or the completeness or accuracy of such information. No guarantee, representation or warranty, express or implied, is given by or on behalf of Phoenix or the Nomad, or any of such person's directors, officers, advisers, agents or employees nor any other person as to the fairness, sufficiency, accuracy or completeness of the information or opinions contained in the Presentation and the accompanying verbal presentation and neither Phoenix, nor the Nomad, nor any of such person's directors, officers, advisers, agents or employees or any other person accepts any liability for any loss whatsoever arising from any use of this presentation or its contents or any such information or opinions (including in the case of negligence or otherwise). In addition, no duty of care or otherwise is owed by any such person to recipients of the Presentation or any other person in relation to the Presentation.
The Nomad is authorised and regulated in the United Kingdom by the Financial Conduct Authority and acts for the Company and no one else in connection with the Presentation. The Nomad will not be responsible or liable to anyone other than the Company for providing the protections afforded to clients of the Nomad.
This Presentation should not be considered as the giving of investment advice by the Nomad, the Company or any of its shareholders, directors, officers, agents, employees or advisors. Each party to whom this Presentation is made available must make its own independent assessment of the Company after making such investigations and taking such advice as may be deemed necessary.
For the purposes of the United Kingdom’s Financial Services and Markets Act 2000 (“FSMA”), the Presentation is exempt from the general restriction in section 21 of FSMA on the communication of invitations or inducements to engage in investment activity on the grounds that they are directed at (i) persons having professional experience in matters relating to investment and who are investment professionals (as defined in article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Financial Promotion Order”); or (ii) high net worth companies unincorporated associations and other bodies (as defined in article 49 of the Financial Promotion Order) or (iii) other persons to whom it may be lawfully communicated (all such persons together being referred to as "Relevant Persons"), and the investments or investment activities to which the Presentation relates are available only to Relevant Persons and will be engaged in only with such Relevant Persons. The Presentation must not be acted on by persons who are not Relevant Persons. Any recipient of the Presentation who is not a Relevant Person (as described above) should not rely on the Presentation and should return the Presentation immediately to Phoenix and take no other action.
This Presentation does not constitute, or form part of or contain any offer or invitation to sell or issue, or any offer to subscribe for, underwrite or otherwise acquire, or dispose of, any securities in Phoenix in any jurisdiction in which such offer or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any jurisdiction.
If and to the extent the Presentation is communicated in, or an offer of the securities is made in, any member state of the European Economic Area ("EEA") that has implemented the Prospectus Directive (each, a "Relevant Member State"), it is only addressed to and is directed exclusively at persons who are 'qualified investors' within the meaning of Article 2(1)(e) of the Prospectus Directive ("Qualified Investors") (or who are persons to whom it may otherwise be lawfully communicated). For these purposes, the expression “Prospectus Directive” means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implemented in a Relevant Member State), and includes any relevant implementing measure in the Relevant Member State and the expression “2010 PD Amending Directive” means Directive 2010/73/EU. No offer of securities in Phoenix is being or will be made in the United Kingdom in circumstances which would require such a prospectus to be prepared.
The Presentation has not been approved by any competent supervisory authority. The Presentation is not for distribution in, nor does it constitute an offer of securities for sale in the United States, Canada, Australia, New Zealand, Japan, the Republic of South Africa or in any jurisdiction where such distribution or offer is unlawful. Neither the Presentation nor any copy of them may be taken or transmitted into the United States of America, its territories or possessions, or distributed, directly orindirectly, in whole or in part, in or into the United States of America, its territories or possessions or to any US person as defined in Regulation S under the US Securities Act 1933, as amended (the “Securities Act”). Any failure to comply with this restriction may constitute a violation of United States securities laws. The Presentation is not an offer of securities for sale in the United States.
The distribution of the Presentation in other jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about and observe any such restrictions. The securities will not be registered under the applicable securities laws of the United States, Canada, New Zealand, Japan, South Africa or Australia and, subject to certain exemptions, may not be offered, sold, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, within such jurisdictions except pursuant to an applicable exemption from and in compliance with any applicable securities laws.
The past performance of the Company and its securities is not, and should not be relied on as, a guide to the future performance of the Company and its securities.
The information contained in this Presentation includes statements that are, or may be deemed to be, forward-looking statements. These forward-looking statements involve numerous assumptions, risks, uncertainties and other factors and the actual results may vary. These forward-looking statements may be identified by the use of forward-looking terminology, such as the terms "intends", "expects", "will", or "may", or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions and include estimates, forecasts and statements as to management's expectations. These forward-looking statements include all matters that are not historical facts. Factors that may cause actual results and events to vary include, but are not limited to, general economic and/or business and/or political conditions, changes in law and/or regulation, Phoenix's ability to develop its strategy, competition, and future changes to current plans and strategy. There can be no assurance that the results and events contemplated by the forward-looking statements contained in this Presentation will, in fact, occur. These forward-looking statements made by Phoenix or on behalf of Phoenix speak only as of the date they are made. Phoenix does not undertake any obligation to revise these forward-looking statements to reflect events, circumstance or unanticipated events occurring after the date of this Presentation except as required by law or regulation.
Investment Highlights
1
Focus, scale and resources to unlock Argentina oil & gas potential:
Independent Board, strong management and proven operating capability
2
Profitable asset base and growing production supporting a transformational growth strategy
1
3
Argentina is a prolific hydrocarbon region with world class shale in Vaca Muerta and an improved political and investment climate
Over 480,000 working interest acres in the Vaca Muerta shale
4
A Leading Independent Argentinian E&P Company
2
Listing Information
London Stock Exchange AIM:PGR
Buenos Aires Stock Exchange BCBA:PGR
Issued Share Capital 2.5 bn
Operational Statistics
2P Reserves 61.7 mmboe
Average Daily Production (H1 2017)
11,537 boepd
Realised Average Oil Price (H1 2017) $51.95 /bbl
Netbacks (H1 2017) $18.59 /bbl
Scale in Argentina
Working Interest Acres 6,430,000
Vaca Muerta Shale Potential, Working Interest Acres
>480,000
Contingent Resources (2C + 2P) 693 mmboe
Prospective Resources (3C + 3P) 1,794 mmboe
Noroeste Basin
Cuyo Basin
Neuquén Basin‘Vaca Muerta Shale’
Golfo San Jorge Basin
Austral Basin
1
Governance – Strong and Independent Board
Philip Wolfe | Chief Financial Officer
John Bentley NED (Independent)
Javier AlvarezNED (Independent)
David Jackson NED (Independent)
Anuj Sharma | Chief Executive Officer
3
Sir Michael Rake | Non-Executive Chairman
Executive Directors
Non-Executive Directors
Guillaume Vermersch NEDGarrett Soden
NED (Independent)
Nicolas Mallo HuergoNED
Matthieu MilandriNED
▪ Led by Sir Michael Rake as Chairman with four additional independent Non-Executive Directors
▪ Intention to comply with full UK Corporate Governance Guidelines in due course
1
Experienced Management and Operating Team
Jorge GonzalezSenior Manager;
Drilling & Completion
26 Yearsexperience
Juan Carlos EstebanSpecial Operations
30 Yearsexperience
Nicolas GarciaSenior Completion
Engineer
14 Yearsexperience
Pablo VarettoHead of Finance and
Controller
~25 Yearsexperience
4
Pablo AriasManager;
Business Development
>12 Yearsexperience
Pablo Prado ZalazarProduction, Maintenance
and Facilities Manager
22 Yearsexperience
Erico StahlschmidtSenior Manager;
Subsurface
37 Yearsexperience
Anuj SharmaChief Executive
Officer
~20 Yearsexperience
Philip WolfeChief Financial
Officer
~27 Yearsexperience
Greg EasleySenior Manager:
Reservoir & Engineering
10 Years experience
Javier VallesiChief Operating
Officer
22 Yearsexperience
1
▪ Argentina focused – deep long-standing relationships developed over decades
▪ Proven record of success – track record of growing reserves, production and cash flows
▪ Experienced team – over 200 years of combined experience operating oil & gas assets
Argentina – an Improving Investment Climate
▪ New Government elected in December 2015 has focused on market reforms and communicating strategy to encourage investment into the country and in particular to the energy sector
– Mid term legislative elections results on 22 October 2017 have strengthened the position of Cambiemos/ the Government and allow them to continue with investor friendly reforms
▪ Improved political climate reflected in reduced bond spreads and strong stock market performance
200
300
400
500
600
700
800
900
1000
1100
Sep-14 Mar-15 Oct-15 Apr-16 Nov-16 May-17
Arg
en
tin
e 1
0y
r G
ov
t B
on
d S
pre
ad
to
10
yr
Tre
asu
ry
Bo
nd
(b
ps)
5
Merval IndexArgentine 10 year Bond Spread
0
2500
5000
7500
10000
12500
15000
17500
20000
22500
25000
27500
30000
Jan 13 Jul 13 Feb 14 Aug 14 Mar 15 Sep 15 Apr 16 Nov 16 May 17
2
Argentina – An Established Oil and Gas Country
▪ Established oil producing region with over 1 million boepd of production
▪ Extensive oil & gas infrastructure in place
– 3,171 km of oil and 17,884 km of gas pipelines
– 10 oil refineries, 639,000 bpd total capacity
– Substantial Vaca Muerta infrastructure
▪ Well established services industry
– Active presence of all major oil field service companies including Halliburton, Baker Hughes, and Schlumberger
____________________Sources: BP Statistical Review 2016, Argentina Investment Agency, Ministry of Energy and Mining and CAMMESA.
6
2
Established oil and gas producing region that has become a net importer
200
250
300
350
400
450
500
550
600
00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16
Exports Imports Hydrocarbon Consumption
Argentine Production & Consumption of Hydrocarbons
Key Majors and NOC Operators & Investors
1,115
802707 665
573
Vaca Muerta – A World Class Shale Play
Recoverable Shale Gas Resources (Tcf) Recoverable Shale Oil Resources (BnBbl)
75
58
32 27 26
USA Russia China Arg Libya
____________________Sources: EIA, Chevron, and AAPG.
7
▪ Vaca Muerta is currently the only oil producing shale outside of North America
– Current production in excess of 65,000 boepd
2
Strong Analogues with Producing US Shale Plays
Play Vaca Muerta Wolfcamp Eagle Ford Mississippi Lime Haynesville Marcellus
Fluids Oil & Liquid Rich Gas OilOil & Liquid Rich
GasOil Gas Gas
Area (million acres) 7.5 11.2 3.0 17.0 6.0 6.2
TOC (%) 3 – 10 3 3 – 5 0.5 – 3 0.5 – 4 2 – 12
Reservoir Pressure (kpsi)
4.5 – 9.5 4.6 4.5 – 8.5 2.0 7.0 – 12.0 2.0 – 5.5
Thickness (ft) ~1,000 ~900 ~130 ~400 ~250 ~200
Vaca Muerta – A World Class Shale Play
____________________Sources: EIA, Chevron, and AAPG.
8
▪ Strong analogues with producing US shale plays including Eagle Ford and Wolfcamp
– Higher total oil content
– Higher pressure providing higher levels of recovery
– Greater thickness than the majority of the US shale plays
2
Recently Announced Investments into Vaca Muerta
Buyer Seller AnnouncedValue
(US$MM)US$/acre Commentary
July 2013 $1,240 $12,900▪ Continuation of previous joint operations▪ Initial outlays of US$1.24Bn
September 2013 $120 $11,000▪ Initial 16 well programme▪ 50:50 joint venture with YPF operating
April 2014 $140 $2,800▪ Four-year 50:50 exploration project drill and analyse 7
vertical and 2 horizontal wells
December 2014 $550 N/A▪ Two investments of US$250MM and US$300MM from the
partners▪ Includes both drilling and processing facilities
March 2015 $475 $10,000
▪ Petronas contributing US$475MM of US$550MM over 3 annual phases
▪ 30 wells planned in 3 year pilot▪ 50:50 JV (YPF operator)
February 2017 $300 $6,950▪ Pilot programme agreed in the block located northeast of
Loma Campana▪ 50:50 JV (Shell operator)
April 2017 $500 N/A
▪ MOU for development of the area in which partners will invest US$300MM in the AP East block and US$200MM in AP West
▪ Agreement includes unitisation of blocks and redistribution of P.I.s
April 2017 $390 $6,900▪ MOU to develop field with the drilling of 26 wells and
construction of new infrastructure▪ 49:51 JV (YPF operator)
9
____________________Source: Based on company announcement, publicly available information, and other company disclosures.
2
Vaca Muerta – Attracting Investment from Majors
____________________Sources: EIA, Chevron, and AAPG.
10
2
Enhancing Operating Efficiency in Vaca Muerta
Case Study: Loma Campana – Well Productivity Ahead Of Key US Analogues And Improving Rapidly…
103
127
100
64 6048
LomaCampana
2015
LomaCampana
2016
Bone Spring Eagle Ford Wolfcamp Bakken
+23%
2015-2016+23%
70 %
2014 wells
2015 wells
2016 wells
70 %
2014 wells
2015 wells
2016 wells
Boe of Estimated Ultimate Recovery (EUR) / Foot of lateral length Cumulative Production from Unconventional Wells
…Whilst Improved Drilling Performance Is Driving Costs Down
Drilling Days vs Depth (Loma Campana 2015-2016) Drilling and Completion Costs of YPF WellsFractures
47%+15M USD 8M USDMUSD
2015 2016____________________Source: YPF public document. 11
2
480,000 net acres with exposure to Vaca Muerta
Phoenix Vaca Muerta Acreage Overview Key Acreages
▪ Puesto Rojas – Cerro Mollar
― Successful unconventional drilling in early 2017
― 3D seismic tied to well data to support successful drilling undertaken
― W.D. Von Gonten has provided estimates of 1 bn Boe of resources
▪ Corralera and Mata Mora
― Pilot wells drilled by operator YPF found productive Vaca Muerta source rocks and are highly prospective
― Negotiating with government and other stakeholders to convert non-operated positions into operated
▪ Net WI acreage position
8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor
El Manzano
Cerro Mollar Oeste
Los BuitresMina Baku
Cerro del Alquitran
La Paloma
Cerro Mollar NortePuesto Rojas
Vega Grande
La Brea
Rio Atuel
Malargue
Cajon de los Caballos EX
Cajon de los Caballos PROD
Chachahuen
Mata Mora
Laguna el Loro
Neuquen
Corralera
Oil Window
Gas Window
Condensate Window
12
3
72k
26k
36k
24k
15k
77k
164k
47k27k1k
Vega Grande El Manzano La Brea Corralera Mata Mora
Malargue Rio Atuel Puesto Rojas Cerro Mollar Oeste Cerro Mollar Norte
Puesto Rojas – Cerro Mollar Overview
Up to ~1 Billion Barrels of Prospective Resources Over ~47,000 Acres in the Northernmost Vaca Muerta Acreage to Date
▪ The successful drilling of the CP-1010
well in 2016
▪ Four further unconventional wells
drilled and completed in Puesto Rojas
in 2017
▪ Shallower and lower cost wells versus
Neuquen province
▪ Significant opportunity to deploy
capital to advance the unconventional
resources for horizontal development
▪ In addition, the successful Cerro del
Medio well in the Tight Agrio suggests
applying new completion technology
could unlock significant conventional
resources
Puesto Rojas Wells relative to Other Vaca Muerta Wells
(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1(8MZK) 948646_1
LVx1El Manzano OesteThickness 115 m
(YPF 2014)
CP-1010Puesto Rojas
Thickness 219 m(Mercuria 2016)
NLaFi.x1Payún Oeste(YPF 2012)
95 km
90 km
Mendoza
Neuquén
Loma CampanaYPF-Chevron(2011-2017)
HorizontalVertical Oil WindowCondensate WindowGas WindowBasin
13
3
Puesto Rojas Well Analysis
CP-1010 Vertical Well Performance May Potentially Be Uplifted by 3-5 Times as a Horizontal Well
Vertical vs. Horizontal Well Type Curve ComparisonNeuquén Basin Wells in the Oil & Condensates
Window
-
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
1 16 31 46 61 76 91 106 121 136 151 166
Cu
mu
lati
ve P
rod
uct
ion
(b
bl)
Days Online
CP-1010 Vertical WellVaca Muerta Cumulative Production
Cum Oil Cum Boe 370 MBoe Type Well Profile
14
3
8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor8MZK: 941987_1.wor
99%
1% 0%
Austral Basin
Neuquen Basin
Cuyo Basin
36%
41%
23%0%
Austral BasinNeuquen BasinCuyo BasinOther
10%
70%
20%
Austral Basin
Neuquen Basin
Cuyo Basin
Leading Argentine Independent E&P Company
W.I. 2P Oil Reserves
W.I. 2P Gas Reserves
44.7MMBbl
102.1Bcf
W.I. 2016A Production
11.3MBoe/d
15
Net Acreage
Noroeste Basin
Cuyo Basin
Neuquén Basin
San Jorge Gulf Basin
Austral Basin
4
529k101k
794k
4,590k
332k
Austral Basin Cuyo Basin
Neuquen Basin Noroeste Basin
San Jorge Basin
47%53%
TUP Other Cuyo
91%
9%
SCS Other Austral
Key Conventional Assets Overview
Santa Cruz Sur Block Group
70 % W.I., Roch S.A. operator
Basin W.I. 2P Reserves
Puesto Rojas - Cerro Mollar
100% W.I., and operator
81%
19%
SCS Other Austral
Tupungato
100% W.I., and operator
Chachahuen
20% W.I., YPF is the operator
56%33%
11%
PR-CM
Chachahuen
Other Neuquen
21.5MMboe
42%
58%
TUP Other Cuyo
8.8MMBoe
Tupungato
Basin 2016A Production
4,073Boepd
4,615Boepd
2,557Boepd
53%
20%
27%
PR-CM
Chachahuen
Other Neuquen
Au
stra
lN
eu
qu
én
Cu
yo
31.4MMBoe
Tupungato
Cerro Mol lar Oeste
Puesto Rojas
Cerro Mol lar Norte
Chachahuen
Corralera
El Manzano
Chorri l los Block 1
Oceano (CA-9 M)
Moy Aike Block 1
16
4
$46.85 ($7.29)
($0.41) ($19.19)
($1.37) $18.59
CombinedRevenues
Royalties Treatment,Storage &
Transp.
LeaseOperating
TurnoverTax
CombinedNetback
Financial Overview
Production (Argentina)
Netbacks (US$/Boe)(1)
Financial Position
▪ Strong financial backing from Mercuria Group
▪ US$160 MM debt facility in place
▪ Net debt of US$132.4 million, as of 30 September 2017
▪ Available cash and undrawn facilities of US$45 million
▪ Additional debt capacity in the local bank market
____________________(1) Argentina operations only. Excluding InterOil, and non-oil and gas activity.(2) Adjusted EBITDA (continuing) excluding one-time charges (US$2.4MM).
17
Pro-forma Revenue
4
8,8489,950
11,284 11,30010,577
0
3,000
6,000
9,000
12,000
2014 2015 2016 1H 2016 1H 2017
Bbl/day$154m
$172m $184m
$95m$82m
$0m
$50m
$100m
$150m
$200m
2014 2015 2016 1H 2016 1H 2017
$31m
$52m $45m
$32m$26m
$0m
$20m
$40m
$60m
2014 2015 2016 1H 2016 1H 2017
Pro-forma EBITDA
Investment Highlights
18
Focus, scale and resources to unlock Argentina oil & gas potential:
Independent Board, strong management and proven operating capability
2
Profitable asset base and growing production supporting a transformational growth strategy
1
3
Argentina is a prolific hydrocarbon region with world class shale in Vaca Muerta and an improved political and investment climate
Over 480,000 working interest acres in the Vaca Muerta shale
4
Mata Mora & Corralera Well Analysis
Recent Drilling Activity in the Area Has Shown Above Average Results in Mata Mora
Map Target Assets Production by Study Area
Mata Mora
Corralera
Others
____________________Note: Analysis performed using publicly available data provided by the Secretary of Energy of Argentina.
19
Puesto Rojas Stratigraphy
▪ Through the successful vertical test and
additional petrophysical work, the company
has been able to demonstrate the presence of
the stacked Vaca Muerta play with six
different horizons for potential development
▪ To assist in its development, the company is
planning to acquire additional 3D seismic data
in 2018
▪ The company is engaged in the drilling of
vertical wells which allows it to acquire the
data needed for future horizontal
development while at the same time
providing significant economic benefits
▪ Once sufficient core and other technical data
is acquired, the company plans to start its
horizontal unconventional drilling programme
which will have a state of the art multiple
transverse fracture completion
Tordillo
SALT
Agrio
Superior
Agrio Inferior
Avile
Chachao
VM1
VM2
VM3
VM4
VM5VM6
RHOB
Passey
resistivity
gamma ray
Potential Upside with Planned Seismic Acquisitions, and Robust Horizontal Unconventional Drilling Programme
Co
nve
ntio
nal
Un
con
ven
tion
al
Overview of Puesto Rojas Geologic Setting
20
Puesto Rojas Cross-Section Analysis
Block Acreage
Puesto Rojas 46,950
Cerro Mollar Oeste 26,934
Corro Mollar Norte 1,236
Total Acreage 75,120
Cross-Section Demonstrates the Correlatability and Thickness of Vaca Muerta in the Area
▪ Geologic characterisation of the CP-1010 well extends to other areas across the Puesto Rojas block
▪ The Vaca Muerta has an interval range from approximately 200 to 400 m in thickness across the concession area
― The Vaca Muerta in the concession area ranges from a depth of 1,600 to 2,600 m
― The play is thermally matured and been proven to be the hydrocarbon source for shallower historical conventional plays
― The Lower Vaca Muerta (VM5/VM6) have very high TOC, as much as 6.5%, resulting in high quality reservoir properties
▪ The Upper Vaca Muerta (VM1-4) have similar TOC and pressure gradient as the Wolfcamp play in the USA
▪ Multiple wells have penetrated and logged petrophysical properties across the formation
CP-1010
21
CP-1010
Puesto Rojas Seismic Petrophysics
3D-Seismic in the Block and Petrophysical Data from Deeper Wells Reveal Significant Contingent and Prospective Resources
NW
TOP VM
TOP TORDILLO
SE▪ 3D-Seismic data available across the northern half of the
concession
▪ Utilised by W.D. Von Gonten (WDVG) to help identify the prospective areas and apply proper risking
▪ Both the Top of the VM and the Base of the VM (Top of Tordillo) can be well imaged
▪ Contingent Resources are assigned in areas where well penetrations exist and relatively undisturbed on the 3D-Seismic data
▪ Prospective Resources are assigned to areas where 3D-Seismic data not available
▪ Recent CP-1010 modern petrophysical data indicates the high quality of the VM reservoir properties
▪ WDVG analysis indicates substantial OOIP in the VM
― The Lower VM (VM5/6) is estimated to have 49 to 93 MMBbl/section
― The Upper VM (VM1-4) is estimated to have another 78 to 178 MMBbl/section
― Potential for multi-zone stacked play development
▪ WDVG estimated volumetric recoverable resources
― Contingent Resources (P50) of 36 MMBbl in 4 areas totaling ~6,400 acres
― Prospective Resources (P50) of 394 MMBbl in 6 areas totaling ~33,700 acres
CP-1010 Petrophysical Analysis by WDVG
22
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