corporate presentation - sterlingenergyuk.com · −drill one exploration well onshore frontier...

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www.sterlingenergyplc.com August 2015

Corporate Presentation

June 2018

www.sterlingenergyplc.com

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Disclaimer

This presentation has been prepared by, and is the sole responsibility of, the directors of Sterling Energy plc (the ‘Company’).

This presentation and the information contained in it does not constitute a prospectus or listing particulars relating to the Company and has not been approved by the UK Listing

Authority, nor does it constitute or form any part of any offer or invitation to purchase, sell or subscribe for, or any solicitation of any such offer to purchase, sell or subscribe for, any

securities in the Company, nor shall this presentation or any part of it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract therefore.

No reliance may be placed, for any purposes whatsoever, on the information contained in this presentation, or upon its completeness or accuracy and this presentation should not

be considered a recommendation by or on behalf of the Company or any of its directors, members, officers, employees, agents, advisers or any other person in relation to any

purchase of, or subscription for, ordinary shares.

No representation or warranty, express or implied, is given by or on behalf of the Company or any of its directors, members, officers, employees, agents, advisers or any other

persons as to the accuracy, fairness, completeness or sufficiency of the information or opinions contained in this presentation and none of the information contained in this

presentation has been independently verified or approved. All financial information contained within this presentation has not been approved by the Company’s auditors and, as

such, may be liable to change. Save in the case of fraud, no liability is accepted for any errors, omissions or inaccuracies in such information or opinions.

This presentation and its contents and any accompanying information communicated verbally as part of the presentation, including the speeches of the presenters, any question

and answers session and any materials distributed in connection with it, is being made only to and is directed only at (i) persons in the United Kingdom having professional

experience in matters relating to investments, being investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial

Promotion) Order 2005, as amended (the ‘FPO’), (ii) high net worth companies, unincorporated associations and other bodies in the United Kingdom within the meaning of Article

49(2) of the FPO, (iii) in the United States to persons the Company reasonably believes to be qualified institutional buyers, as defined in Rule 144A(a)(1) of the United States

Securities Act of 1933, as amended (the ‘Qualified Institutional Buyers’) and (iv) persons to whom the presentation may otherwise lawfully be made (together ‘Relevant Persons’).

This presentation must not be acted on or relied upon by any persons who are not Relevant Persons. Any investment or investment activity to which this presentation relates is

available only to Relevant Persons and will be engaged in only with Relevant Persons.

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Certain statements in this presentation are or may constitute ‘forward looking statements’. Such forward looking statements involve risks, uncertainties and other factors which may

cause the actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed by such

forward-looking statements. The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice.

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Disciplined M&A driven growth

Robust platform, Capital discipline, Transformational M&A focus

Somaliland

Odewayne

Sterling 34%

Genel 50% Op.

Petrosoma 16%

M&A focus Debt free & fully

funded Ca. $47.3m cash*

Major

shareholders

(~45%) on Board

Proven

international

operator

Material M&A

2P/2C mandate

Odewayne

1,000kms 2D

completed

*Unaudited as at 31 Mar-18

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Corporate snapshot

LSE-SEY Ticker

(AIM listing 2002)

GBP £0.131 Share price

220.1 Shares outstanding

(million)

220.1 Fully diluted share positions

(million)

$38.3m1 Market capitalisation

(US$ million)

$0 Debt (US$)

$47.3m Cash at 31 Mar-18

(US$ million - unaudited)

Q1 2018 Financial summary (unaudited)

Turnover $525k

Adj. EBITDAX

(US$ million) $(476k)

Advisors

1 as at 05 June-18

Share ownership*

Waterford

Finance &

Investment

(29.45%)

Zion SPC

(16.64%) Mistyvale

(15.66%)

Denis O’Brien

(7.16%)

Banque Heritage

(6.78%)

Retail &

Institutional

(24.31%)

Sterling Energy

Corporate profile

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35

Years

24 Years

International experience in Oil and Gas Production and Development from

numerous locations including Tunisia, Turkmenistan, North Sea, Gulf of

Mexico, Gabon, the Middle East, Egypt and Holland. He was CEO of DEO

Petroleum Limited and work at Enquest (Egypt) prior to becoming Chairman of

Arenite Petroleum and Director of Boreas Resources. MSc in Petroleum

Engineering from Heriot Watt University and a BSc (Honours) Civil

Engineering from Glasgow University.

David Marshall

CEO

Michael

Kroupeev

Non Executive

Chairman

Sterling Energy Board

Shareholder aligned (45% of fully diluted share positions represented)

Founding Director, Waterford Finance & Investments Ltd (Oil & Gas focussed

investment vehicle with shareholdings in companies with operations in Europe,

Africa, North America and Australasia)

Previously Non-executive director of Sibir Energy Plc & Dana Petroleum Plc

29

Years

Senior E&P executive with an MSc. in Petroleum Engineering from Delft

University, the Netherlands. Following a successful career with Shell

International, he has been involved in multiple successful business start ups of

scale including EDP ltd, TAQA Bratani (UK) Ltd and TAQA Iraq BV. Executive

Chairman at Columbus Energy Resources plc

Leo Koot

Audit, Remco

Chairman & NED

12

Years

Representing Mistyvale Ltd. Investor in Private equity and Venture capital

projects through Supremum capital and Concentric VC. Focus on finance and

real estate sectors in Russia and UK. Previously with JP Morgan, Barclays

capital and VEB capital in M&A, Corporate finance and capital markets. Mr

Belyaev has an MSc in Mathematics from Moscow State University.

Ilya Belyaev

NED

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Somaliland – Odewayne

Recently completed 1,000km 2D seismic program (first ever on block)

Joint Venture

− Genel (Operator) 50%, Sterling 34%, Petrosoma 16%

− Revised Farm-out terms with Petrosoma in April 2017

(US$8m contingent consideration cancelled for payment

of US$3.5m and transfer of 6% interest in the PSA)

Licence Terms and Commitments

− Carried by Genel for all costs in Periods 3 & 4 (to 1st

well)

− Period 3: May 2012 – November 2019

− Airborne gravity and magnetics survey - completed

− Acquire 500km 2D seismic data Q2 2017

− Period 4: November 2019 – May 2021

− Acquire 1,000km 2D seismic data

− Drill one exploration well

Onshore frontier exploration

− Huge onshore block of 22,840km², equivalent to +/- 100

UKCS Blocks.

− Low cost 2D acquisition, drilling and access to Berbera

deep water port less than 100kms to North

Odewayne - Sterling

Energy 34%

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Somaliland - Odewayne

First mover advantage in unexplored Mesozoic rift basin

Pre-rift configuration Petroleum System

− Huge frontier exploration block with no

seismic control and no drilling to date

− Rift basin interpreted to be deep enough for

Jurassic source rocks to be mature (3.5km+),

possibly of Permo-Triassic Karoo age

− 32 deg API flowed to surface from Jurassic

carbonates in Daga Shabell-2 well (1959) to

the north of the block

− Active petroleum system confirmed by oil

seeps within the block

− Sub-surface basin structure identified by 2013

aero-magnetic survey; multiple 3-way fault-

controlled traps likely with sedimentary fill as

key unknown

Odewayne Basin

Petroleum system- Play elements

Source: Genel

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Somaliland - Odewayne

First mover advantage in unexplored Mesozoic rift basin

2017 2D seismic program

− Government operated (MOEM) multi client 2D

seismic acquisition program contracted to BGP

− 3 month program, completed August 24th 2017

− 2D seismic program on Odewayne block exceeds

minimum work obligation for Period 3

− 1,001 kms full fold Vibroseis acquisition program

− Average production rate of 13kms / day

− 10 x 10 km grid over “basin areas” defined from

Potential fields (Gravity and Magnetics) data

− Reduced dip spacing infill lines to 5km as

required

− Phased Full Pre Stack Time migrated data (3 trial

line processing) completed in Q2 2018

2017 2D seismic program

Odewayne Basin

Vibroseis

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2017 2018 2019 2020

Country Asset H2 H1 H2 H1 H2 H1

Growth / M&A projects

Somaliland

(Frontier)

Odewayne

(34%*) 2013 entry

2D Seismic and well costs

fully carried

Activity Timeline

Focus on transformative M&A driven growth

Note: Company estimates

Due diligence & execution

1,000 km 2D Seismic

Processing &

Regional Evaluation

Decision to

Enter Phase 4

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Ancillary information


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Sterling Management team

International experience in Oil and Gas Production and Development from numerous locations

including Tunisia, Turkmenistan, North Sea, Gulf of Mexico, Gabon, the Middle East, Egypt and

Holland. He was CEO of DEO Petroleum Limited and work at Enquest (Egypt) prior to becoming

Chairman of Arenite Petroleum and Director of Boreas Resources. MSc in Petroleum Engineering

from Heriot Watt University and a BSc (Honours) Civil Engineering from Glasgow University.

David Marshall CEO

Anish Airi Subsurface & Reservoir

Engineering Manager

James Munt Senior Finance Manager

Oil and Gas experience covering all aspect of finance and accounting, specialising in

Group and Joint Venture accounting. Focused on assets in Africa, Middle East and the US.

International upstream experience from numerous locations including Nigeria, Norway, Oman,

Kenya, Netherlands and Kuwait. He has worked for Shell International, Shell Trading, Nexen

International, MRI and was Technical Director EMEA at Macquarie Group. MSc in Chemical

Engineering from Imperial College London.

19 Years

35

Years

17 Years

Mary-Ann Page HR/Facilities Manager

Human resource professional specialising in the Oil and Gas sector. Managerial

experience focused on HR, HSE, IT, Facilities Management and Procurement. 34 Years

Simon Compton Head of Commercial &

Legal

31 Years

International upstream experience in 50 countries and 30 appraisal and development

projects, specializing in investment appraisal, petroleum economics and business

development. He has worked with BHP, Enterprise Oil, Hess, Premier Oil, Gulf Keystone

and BMO Capital. MSc in Sedimentology from the University of London.

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Somaliland – Country Overview

Frontier opportunity

Government

– Somaliland (637,000 km2) was a UK protectorate from

1888 until 1960

– Declared independence from Somalia in 1991; allowed

development of a stable, democratic government

– Not recognised as an independent nation but

favourable political contacts with a number (ca. 35) of

countries including UK

– 26 years of Democratic elections & 4 Presidents

Economy (2014)*

− GDP: $1.4 billion (ca.$347 per capita)

− Real GDP increasing by 3.7% pa since 2014

− Livestock (10 million goats, 5 million sheep, 5 million

camels and 2.5 million cattle) provide economic back

bone (60-65% of Notional economy)

− Population 3.5 million

Oil & Gas

– Berbera Deepwater port ca 100kms from Odewayne

block

– Immature Exploration sector, No production to date

* Source World Bank

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Sterling Energy

The journey to date

2003

Acquisition of

Fusion Oil &

Gas plc

2004

Chinguetti field,

Mauritania,

Funding & Royalty

agreement

2005

Farm out of

Ambilobe &

Ampasindava

blocks in

Madagascar to

XOM

2006

First production

from Chinguetti

oil field ,

Mauritania

2009

Share placing

and Board

changes

following sale of

US business

2010 Sangaw North

well drilled in

Kurdistan (fully

carried)

2013

Ambilobe block,

Madagascar

farm out to Pura

Vida

2015

C-3 block Mauritania

farm-in with Tullow

(ground floor)


farm-in / entry with Tullow

(ground floor)

Ambilobe block

Madagascar Operated 3D

survey (fully carried)

Ampasindava block

Madagascar

relinquishment (disciplined

data driven decision)

2007

Acquisition of

Whittier Energy

corporation Gulf

of Mexico assets

(USA)

2008

Themis Admiral

Marin & Iris

Charlie Marin

wells drilled

Gabon

2016


exit (post new 2D

evaluation – disciplined

data driven decision)

Ambilobe block

Madagascar exit (post

new 3D evaluation –

disciplined data driven

decision)

Ntem, Cameroon exit

(disciplined

relinquishment based

on remaining

prospectivity vs. work

commitments)

Odewayne, Somaliland, Revised Farmout terms to cancel contingent payments to Petrosoma

2017

Shareholder led Board

Capital restructuring

Chinguetti end of field life and

Abandonment &

Decommissioning

Odewayne, Somaliland, Revised

Farm-out terms to cancel

contingent payments to

Petrosoma. Completion of

1,000kms 2D

C-10 block Mauritania exit

(disciplined commercial

decision)

2002 Listed on

AIM

2014

Bamboo well

drilled in Ntem

block Cameroon

(fully carried)

Two-stage

Odewayne

block,

Somaliland

farm-in, (carried

in phase III & IV)

MATERIAL EXPLORATION PORTFOLIO RATIONALIZATION AND MATERIAL M&A

2018

Chinguetti Funding

agreement exit

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website www.sterlingenergyplc.com

e-mail: [email protected]

52-54 High Holborn, London, WC1V 6RL

Tel: +44 (0) 20 7405 4133

Fax: +44(0) 20 7440 9059

corporate presentation - sterlingenergyuk.com · −drill one exploration well onshore frontier...

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