tullow in africa building a balanced portfolio of exploration and production assets not an official...
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Tullow in AFRICABuilding a balanced portfolio of Exploration and Production Assets
NOT AN OFFICIAL UNCTAD RECORD
2004 - A Landmark Year for 18 year old Tullow Oil Over $1 billion on acquisitions
– Energy Africa, Schooner and Ketch (North Sea Gas Fields) New organisation structure
– COO: Production and Development, five business units– Exploration Director, enhanced exploration focus– EHS/CSR policies aligned across enlarged group
Exploration success – Discoveries in Bangladesh– “Snuggle” exploration in Gabon, Equatorial Guinea and the UK
Quality assets– Current working interest production over 56,000 boepd
Quality reserves– 326 mmboe total reserves, 173 mmboe commercial reserves
Focused growth strategy
– Africa, NW Europe, South Asia
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The 2005 Tullow “footprint”
Africa
South Asia
NW Europe
3 core areas (operator in all 3)– Africa – NW Europe– South Asia
16 Countries, 12 in Africa
90 Licences
25 producing fields
Strategic focus on:– Oil in West Africa – Gas in the UK SNS– Growth in South Asia
Major offices London (HQ), Dublin, Cape Town. Many regional offices.
C. 200 employees
Market capitalisation c. £1.1 bn
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Ongoing active portfolio management Focus on those assets where we can add value
through:– Material influence– Upside potential– Operational innovation
Strategic objectives:– Build strong positions in core areas– Consolidate niche positions in developing regions– Exit where we can’t achieve material influence
Continually reviewing our portfolio versus long term growth:
– Since year end disposed of Alba/Caledonia and offshore Congo– Headline consideration of US$184 m
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SOME NUMBERS
Balanced growth is the key
Building a balanced portfolio of Exploration and Production Assets
Revenue Balance
2004: US$430 million
Production Balance
2004: 40,600 boepd
Product Balance
2004: US$430 million
Reserves Balance
2004: 326 million mmboe
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Africa 47%
Africa 47%
2005 Development and Exploration Spending
Development Exploration Total
US$ Development Exploration Total
Africa 135.0 48.0 183.0
NW Europe 40.0 23.0 63.0
Asia 15.0 5.0 20.0
TOTAL 190.0 76.0 266.0
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Africa Africa Africa
OPERATIONS REVIEW
Recent Highlights2004 was an exceptional year for Tullow’s production and
development businesses
Acquisitions: Energy Africa, Schooner & Ketch, Orwell, Horne & Wren Integration: Reorganisation to Business Unit structure
Africa Production increased to over 30,000 bopd Reserves: replacement 250% Developments: M’Boundi expansion, West Espoir and Okume sanction Kudu: JDA signed July; conceptual engineering completed
UK Opex: Bacton/Hewett 25% reduction, Thames export up >100% Development: CMSIII completed, Horne & Wren and Munro underway Operatorship: positioned to increase to 60% of production
South Asia Bangladesh: Bangora and Lalmai gas field discoveries Pakistan: strategic review and progress on Chachar field development
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Tullow’s Africa Strategy
Africa
Capitalise on 18 years African experience both onshore and
offshore
Pursue opportunities that arise as majors exit non-material
assets
Target near-shore operated development projects
Extract additional value from existing assets with operational
innovation
“Snuggle” exploration balanced with higher impact/risk prospects
Selective acquisitions within our core areas
Active portfolio management
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Tullow in GabonProduction Now over 19,000 bopd
Drilling Niungo – up to 8 further infill
wells Tchatamba – further sidetrack Etame – further development
wells Up to 3 operated exploration
wells
Developments Avouma development planned Tchatamba sour oil study
….leverage UK SNS experience and operating capability…. 0 50 100km
Exploration Licence
Back In R ights
Exploitation / ProductionLicence
L ib rev i lle
P o rt G e n t il GABON
EQUATORIALGUINEA
KIARSSEN YM ARIN
AZO BE
LIM AND E
NZIEM BO U
NIUNG O
EC HIRA
M AYON AMI VERA
TCHATAM BA
M ’P o lo
Etame Expl.
G RYPHO NM ARIN
AKO UM
TURNIX
ABLETTE
ETAM E
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Tullow in Congo M’Boundi
Development Production now >35,000 bopd Up to 22 further development
wells Pilot water and gas injection
projects Facilities expansion to 60,000
bopd
Field Areas and Reserves
Area 1 Drilled and mapped on 3D seismic 20 mmbo 2P reserves Additional 9 mmbo 3P reserves
Area 2 Undrilled, new 3D seismic
acquired Potential to add further 27 mmbo
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Tullow in Côte d’IvoireProduction East Espoir increase to >25,000
bopd
Drilling 4 East Espoir infill wells
underway West Espoir drilling starts Q4 05
West Espoir Development
Production 10,500bopd
First oil Q2 06
Total Capex of $190m
Modifications to FPSO underway Wellhead tower installation Q4
05
Acajou Development Review development options
CHANGE PHOTO
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Tullow in Equatorial GuineaProduction Ceiba production 40,000
bopd
Drilling Up to 8 infill wells on Ceiba
Okume Development
Production 60,000bopd First oil end 06
Total capex of $1.1 bn 2 deepwater TLP’s, design
underway Shallow water Central
Processing Facility with 3 satellite platforms
2006 installation and drilling
CHANGE PHOTO
Design of the Okume Development
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Tullow in Namibia (Kudu Project)Phase 1: Gas to power
800 MW power plant with c. 110 mmscfd gas supply
Net Reserves – 780bcf
First Gas - 2009 Complete FEED studies,
offshore pipeline and well surveys
Finalise GSA/PPA discussions Finalise partnering and
funding
Phase 2
Upside net reserves of 4tcf
Complete planning for 2006 appraisal drilling
Development concepts under review
– LNG, GTP Phase 2, GTL
CHANGE PHOTO
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Exploration Review
Africa Exploration2004 Review Energy Africa / Tullow integration 24 licences in 11 countries Strong combined synergies Strategic focus on West Africa
2005 OutlookGabon 5 major licences 3 back-ins 4 wells to be drilledIvorian-Ghanaian Basin Begin work on CI-107/108 Target new ventureMauritania Further Block 2 well in 06 2 prospects in Block 1, 150
mmbbl+ each Block 1 – 1 well in 05Uganda 2x 500mmbl Albertine Basin
prospects
Na m ibia
C ongoEq. Guinea
IvoryC oa st
Egypt
M orocco
M a uritania
U ganda
C am eroon
Gabon
S enegal
ATLAN TICO C EA N
IN D IANO C EA N
MEDITERRANEAN SEA
D elta ic sa g b as in
In terio r frac tu re b as in
F o re lan d b as in
W ren c h b as in
M arg in a l sa g b as in
Tu llo w lic en c e a re a
18 years of experience in the region
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Africa: Exploration Drilling Programme
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Our unique characteristics Entrepreneurial spirit
– Creative and flexible approach to acquisitions and development African heritage and continued intense African focus
– First E&P project in Senegal (15 yrs), today in 12 African countries Strong relationships
– Work hard at being good employer, partner and operator Development focus
– Swift response to any development opportunities as they arise Diverse and quality portfolio
– Mix of oil and gas in mature and developing markets Active asset management
– Continually review portfolio in relation to our long term objectives Material influence
– Target material equity participation and aligned JV partnerships Financial capacity
– Conservative accounting, strong cash flow and healthy balance sheet
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Who owns Tullow Oil?
Shareholder Analysis
Market Capitalisation ≈ US$ 2 bn
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African 18%
African 18%