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  • 1. 2012ANNUAL RESULTSPRESENTATION //21 March 2013
  • 2. 21 March 2013 // Page 1Forward looking statementsThis presentation may contain forward-looking statements andinformation that both represents managements currentexpectations or beliefs concerning future events and are subjectto known and unknown risks and uncertainties.A number of factors could cause actual results, performance orevents to differ materially from those expressed or implied bythese forward-looking statements.
  • 3. 21 March 2013 // Page 2AgendaStrategy and 2012 highlightsBusiness Units reviewKey operated developmentsExploration update2012 financial resultsSummarySimon LockettRobin AllanNeil HawkingsAndrew LodgeTony DurrantSimon Lockett
  • 5. 21 March 2013 // Page 4Delivering on our strategy• Focus on high quality, high return developments– Chim Sáo, Huntington, Catcher, Bream,Sea Lion – FPSOs– West Natuna, North Sumatra – Asian gas position• Acquisitions focused on core areas, existing fields,future developments– Disposal of non-operated/non-core assets• Focus on play-opening wells and high impact prospects– Disciplined spend• Maintain balance sheet strength and good liquidity• Production growth to 100,000 boepd and beyond– Substantial cash flow increases• Continue growing the underlying value of the business– NAV/share CAGR >10%
  • 6. 21 March 2013 // Page 52012 highlights• Four projects achieved final sanction– Targeting first oil/gas in 2014• Significant progress with the operatedCatcher field– Final sanction targeted for this year• Successful entry into Falkland Islands– Sea Lion development planningwell underway• Play-opening acreage added in Vietnam,Falkland Islands and Iraq– Total prospective resources >2.5 bnboe• Increased financial strength– Record profitability– Strongly rising cash flows• Production of 57.7 kboepd, 43% increase
  • 8. 21 March 2013 // Page 7Falkland Islands• Completed purchase of 60% interestin Rockhopper’s assets for $231million cash and $770 million carry• Appointed operator of Rockhopper’slicence interests in November 2012• Falkland Islands Business Unitestablished in dedicated office– 70 employees by mid-year• Attractive fiscal regime with aneffective tax rate of 32.6%• Sea Lion alone adds approximately200 mmbbls of net discovered 2Cresources• Substantial exploration upside
  • 9. 21 March 2013 // Page 8UKOperated• Significantly higher uptime at the Balmoralfacility achieved in 2012• Solan progressing with 1st phase ofdevelopment drilling to commence in April• Catcher development concept formally agreed;first oil timing dependent on FPSO tenderprocessNon-operated• Long lead items have been procured for theKyle field redevelopment• Wytch Farm production exceeded budget dueto process plant upgrades, new wells andworkoversHuntington and Rochelle• Huntington expected on-stream at the end ofthe month• Rochelle expected on-stream 2/3Q 2013UK production run rate of 25 kboepd onceHuntington and Rochelle on-stream; doubling to>50 kboepd once Solan and Catcher on-stream* Assumes 4Q 2016 for Catcher
  • 10. 21 March 2013 // Page 9NorwayBream• Completed SPA with Skeie to increaseequity in Bream to 40%• FPSO planned; engineering studiesunderway• Project sanction early 2014• First oil in 2017 with an initialproduction run rate of 35 kbopdFrøy• Commercial discussions to develop acentral processing hub continueExploration• Luno II spudded• Built on Mandal High position throughlicensing round and acquisitionPortfolio management• Non operated discoveries under reviewGrosbeak;Skarfjell extensionLuno IIMandal HighFroyBreamBlabaer
  • 11. 21 March 2013 // Page 10Pakistan• Pakistan achieved 2012 production of 15.6 kboepd• Exploration successes at K-30 and Badhra B North-1• Further potential to be tested in 2013
  • 12. 21 March 2013 // Page 11VietnamChim Sáo• 10.5 mmboe produced in 2012• Currently producing ~30 kbopd and ~25 mmscf/d• Addressing power issues which could lead to greaterdeliverabilityDua• 3 well subsea tie back to Chim Sáo• Installation of main pipeline commenced inFebruary 2013• Forecast average gross production rate of8-10 kbopd in the first 12 months• First oil targeted for 1H 2014CRD• Appraisal well to be drilled in mid-2013Dua pipe lay February 2013
  • 13. 21 March 2013 // Page 12IndonesiaNatuna Sea Block A PSC• Gas sales to Singapore averaged 217 BBtud, up 42%• Total sales capacity increasing to 400 BBtud– Anoa Phase 4, Pelikan and Naga• Year to date market share of 45%• Rising market share offsets impact of LNG in Singapore• Lama development plan underwayKakap PSC• 2012 gas sales to Singapore averaged 33 BBtud• Liquids produced averaged 3.5 kbopd in 2012Block A Aceh• Focus on improving economics; project sanction by year-end– Capex estimate of ~$650mm– Operator’s efforts to secure higher gas pricesprogressing well• Matang well may have a positive impactConstruction of Pelikan/Naga jacketsAnoa phase 4
  • 15. 21 March 2013 // Page 14Solan project updateKey milestones• Full DECC and partner approvalsreceived in April• First oil targeted for Q4 2014; initialproduction run rate of 24 kbopd• Capex ~$20/bblSubsurface and drilling• Detailed reservoir studies ongoing; wellplanning complete• Rig contracted– Phase 1 April 2013: 2 injectors &producer upper hole sections– Phase 2 April 2014: finish drilling 2producersProducersInjectorsSolan reservoir cross sectionSolan well plan
  • 16. 21 March 2013 // Page 15Solan project updatePlatform and Subsea• Platform fabrication commenced at Methil yard, Scotland• Construction of subsea storage tank commenced inDecember in Dubai• Heavy lift installation in Summer 2014• Contract for associated subsea flow-lines and controllines awarded• Platform manned for first year only, thereafter monthlymaintenance visits• Operations support contract awardedPlatform fabrication at MethilSubsea tank fabrication Solan development schematic
  • 17. 21 March 2013 // Page 16Catcher project updateKey milestones• JV formally agreed developmentconcept in December 2012– Leased FPSO– Subsea development of three fields• Sanction targeted for end 2013• First oil modelled for 2H 2016, subjectto FPSO proposalsSubsurface and drilling• Reservoir modelling being updatedto optimise subsurface developmentand drilling plans• Rig procurement process tocommence shortlyFPSO and subsea wells
  • 18. 21 March 2013 // Page 17Catcher project updateFPSO and subsea• Funded tender for the leased FPSO commenced in February with three FPSO providers• Subsea FEED is underwayNow FPSO BidsProjectSanctionOrder LongLead ItemsFPSO Funded Tender ProcessEvaluate BidsFinalise ContractsSubsea FeedTender Subsea EPCI Contract(s)Optimise Subsurface Development PlanTender Drilling RigCATS / Fulmar NegotiationsJV Approval ProcessDECC Approval ProcessPrepare DECC Field Dev.PlanPrepare Environmental Statement2013Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov DecFPSOSubseaDrilling and SubsurfaceSelect Gas OfftakeRouteApprovals
  • 19. 21 March 2013 // Page 18Sea Lion project updateKey milestones• Concept selection targeted for mid-2013• Project sanction targeted for mid-2014• First oil targeted for Q3 2017Subsurface and drilling• Detailed static and dynamic reservoirmodelling underway for Sea Lion• Rig contracting strategy being developedand discussions with rig companiescommenced• Evaluating options and timing for satellites• Planning logistics and base requirementsfor the development drilling campaign
  • 20. 21 March 2013 // Page 19Sea Lion project updateFPSO and subsea• FPSO market enquiries undertaken toassess options for conversions and newbuilds• Technical studies ongoing, reviewing FPSOfatigue life, turret designs and offloadingoperability• Technical reviews undertaken to study optionof gas lift instead of HSPs• Preliminary topsides designs being assessed• Design studies underway to assess towedbundles as an alternative to conventionalflowlines• Evaluation of contractors for subsea FEEDhas commenced
  • 21. 21 March 2013 // Page 20Reserves and resources –continuing growthIndependent valuations• Based on D&M’s value of 2P reserves and RISC’s value of Sea Lion– $6.5 billion NPV10 at $85/bbl, equivalent to £6/share– $9.8 billion NPV10 at $105/bbl, equivalent to £10/share• Excludes other contingent and prospective resources900Year end20076005004000200300Year end2011100Reserves and contingent resources(mmboe)Production Additions &RevisionsYear end20122C contingent resources2P reserves800700
  • 23. 21 March 2013 // Page 22• 12 exploration and appraisalwells drilled in 2012– Carnaby discovery– K-30 and BBN-1successes– Anoa Deep discovery,opened up Lama play• Three wells currently drilling– Matang– Bonneville– Luno II• Transforming the exploration portfolio, adding higherimpact plays with significant follow on potential– Added 1 bnboe prospective resource in 2012Transforming the exploration portfolio
  • 24. Q1 Q2 Q3 Q4Block 121 Ca Voi 120 HighBlock 07/03 CRD appraisal N/A TBCCa Duc 45 HighBlock A Aceh Matang 40 ModerateTuna Block Kuda Laut & Singa Laut 100 HighNorway PL359 Luno II 120 ModerateP1181 Lacewing 58 ModerateP1430 Bonneville 10 LowK-32 7 LowK-36 5 LowBadhra South Deepening-1 38 HighBBN-1 West 8 LowBadhra-6 Parh 58 ModerateKenya L10A/L10B Contingent well TBC TBCMauritania PSC C-10 Tapendar TBC TBCNorth SeaUKRest of WorldPakistanKadanwariBadhra-BhitIndonesiaAsia2013 P50 gross unriskedresource (mmboe) RiskVietnamWeatherford 812Bredford DolphinMaersk ResiliantSLBRig-23Century Rig 28Ocean GeneralOcean GeneralOcean GeneralWeatherford 812SLBRig-23SLB Rig-60WilPhoenixOcean General21 March 2013 // Page 232013 exploration drilling programmeContingent WellsFirm Wells: Rig ContractedFirm Wells: Rig TBCAll well timings are subject to revision for operational reasonsWells to watchFive high impact wells targeting in excess of150 mmboe of net unrisked prospective resources
  • 25. Lacewing21 March 2013 // Page 242013 North Sea exploration –Luno II and LacewingPL 359BCU Time MapC.I. 100 ms10kmJohan SverdrupLuno/ApolloRagnarrockLuno II ProspectLuno II (spudded)• Luno II is on the south west margin of the Utsira high• Critical risk: reservoir presence• Gross prospective resource: 30-120-300 mmbo• Currently drillingLacewing (1H 2013)• HPHT Triassic test; learnings will be applied to UKand Norway• Gross prospective resource: 24-58-110 mmboe• Critical risks: trap effectiveness and reservoir quality• Well expected to spud April 2013Inner Moray FirthMandal HighGreater Catcher AreaQuad 16MesozoicLuno IILacewingBonnevilleGrosbeak;Skarfjellextension
  • 26. 21 March 2013 // Page 252013 Nam Con Son programmeKuda/Singa Laut (2H 2013)• Faulted dip closed structure up dip from a proven sourcekitchen to the east• Low risk for gas, high risk for commercial oil• Gross prospective resource: 60-100-140 mmboeSilver Sillago (Ca Duc) (2H 2013)• Analogous to Chim Sao• Critical risk: fault seal• Gross prospective resource: 20-45-105 mmboeCa DucNW SENW SEBelut Laut-1TD 4977mKudaLautMMUL.TerumbuArangGabusDepth of Top Oligocenein Gajah Laut UtaraTop BasementTop NCSTop CauMMUDua2kmGajah Laut Utara-1TD 4687mSingaLaut
  • 27. 21 March 2013 // Page 262013 play-opening well – Ca Voi• Premier equity 40%• The Ca Voi prospect is the first test of theOligocene play in the Phu Khanh Basin• High risk well with multiple follow-up potential• Gross prospective resource: 35-120-190 mmbo• Well planned for May 2013121-CV-1X 121-CV-1XNW SW W ESea BedMid MioceneSyn-Rift Unc.Basement2km121-CV-1ProposedSurfaceLocation
  • 28. 21 March 2013 // Page 27Ca Voi follow on potential• A successful Whale (Ca Voi) wellde-risks multiple leads– Swordfish– East Whale• Unexplored intra-basinal highs inthe deep water part of Block 121• Block resource potential >1 bnboeDeep WaterLeads AreaBasinEdgeLeadsBlock 121 Prospects and LeadsSwordfishWhale &East Whale25kmNESWTop MioceneTop OligoceneBasementWhale East Whale DW Lead 1 DW Lead 2
  • 29. 21 March 2013 // Page 28Kenya exploration (2013/14)L10A & L10B• Oil (Miocene carbonate) play in the West,deeper Cretaceous sandstone (gas?) play inthe East– 5000 km2 of 3D and 1000 km 2D acquired• Upcoming drilling in 2014, possibly late 2013• Gross prospective resource: ~1bn boeInboard Reef PlaySW NE Kiboko Prospect,Block L11BOutboard PlaysBlock L10BW E
  • 30. 21 March 2013 // Page 29Lama play (2014/15)• Anoa Deep– ~300 feet of fractured LamaSandstones within the Anoa field– 70-100-150 bcf total gas in place• Significant follow-on potential– Gross accessible prospectiveresource: ~2TCF– Exploration drilling in 2014 and2015Lama Prospects and Leads
  • 31. 21 March 2013 // Page 30Mandal High (2014/15)• Shares similar characteristics tothat of the Utsira High in 2008– Proven Kitchen to west of High– Proven Jurassic sands to eastof High– Hydrocarbons proven inbasement• Myrhauk prospect is targeted fordrilling in 2014Premier has access to ~ 200 mmbo of net prospective resources on and around the Mandal High
  • 32. 21 March 2013 // Page 31Falkland Islands exploration (2014/15)Fan 2 Fan 3Fan 1• Defined lead and prospect inventory• A minimum of 3 exploration wells planned– Play opening wells to be drilled below existingSea Lion sands and in up-dip east flank sands– 100-250-750 mmboe total resource potential inmultiple stacked targetsFan 5Fan 1Fan 2Fan 3Fan 4Beverly DiscoveryCasper SouthDiscovery
  • 33. 21 March 2013 // Page 32What should you expect fromexploration in 2013• Play opening test in East Vietnam• Key prospects drilled in Nam Con Son and North Sea• Near field drilling in Catcher, Aceh and Pakistan• Mature portfolio for 2014/15 drilling– Kenya– Norway (Mandal High)– Indonesia (Lama)– Falklands– UK (Inner Moray Firth)• Exit non-material acreage• Continue to replenish the portfolio, adding new highimpact plays
  • 34. FINANCE //
  • 35. 21 March 2013 // Page 34Record profits12 months to31 Dec 2011Operating costs (US$/bbl)2012 2011UK 41.9 39.5Indonesia 11.2 11.1Pakistan 2.3 2.4Vietnam 13.7 16.6Group 16.2 15.9Highlights12 months to31 Dec 2012Working Interest production (kboepd)Entitlement production (kboepd)Realised oil price (US$/bbl) - pre hedgeRealised gas price (US$/mcf) - pre hedgeSales and other operating revenuesCost of salesGross profitExploration/New BusinessGeneral and administration costsOperating profitFinancial itemsProfit before taxationTax charge/(credit)Profit after taxation40.437.7111.98.5US$m827(415)412(211)(26)176(34)1422917157.751.6111.48.3US$m1,409(743)666(187)(24)455(95)360(108)252• Net impact on 2012 ofUS$25 million post-tax• 17% of 2013 production hedged ataverage equivalent of US$105/bbl• Rolling forward sale programme for2014 targeting US$110/bblHedging
  • 36. 21 March 2013 // Page 35Rising cash flowsCash flow from operationsTaxationOperating cash flowCapital expenditureAcquisitions/disposals, netFinance and other charges, netPre-licence expenditureNet cash out flow12 months to31 Dec 2011US$m 2012DevelopmentExplorationCapital expenditure split (US$m)772530(44)486(661)(90)(50)(23)(338)12 months to31 Dec 2012US$m1,041(233)808(772)(210)(163)(29)(366)2013 Forecast of US$1 billion (development) and US$200 million (exploration)4332286612011• Five-year acquisition cost:– US$6.6/bbl (including carries)• Five-year development capex(new projects):– US$14.3/bbl• Five-year exploration/appraisal cost(post tax):– US$5.4/bblAcquisitions, development andfinding costs585187
  • 37. 21 March 2013 // Page 36Group taxation positionOverseasPrior period provisions/revisionsUKPRTCTCurrent chargeDeferred tax creditsTax charge/credit for the year12 months to31 Dec 2011US$mAllowances brought forwardNet additionsRFESTax allowances carried forwardUK Tax Losses/Allowances Position12 months to31 Dec 2012US$mTax chargeTax paying overseas; no UK CT expected until post-2018Overseas tax position• Tax paying - Indonesia, Pakistan, Vietnam• Expected effective rates for 2013:137.0(11.9)83.1–208.2(100.3)107.91,3603981291,887% of Operating Profit*Indonesia 50Pakistan, Vietnam 30-3360.170.017.2–147.3(177.0)(29.7)As at 31 DecUS$m*Before exploration write off
  • 38. 21 March 2013 // Page 37CashBank debtBondsConvertiblesNet debt positionGearingCash and undrawn facilities309(484)(341)(228)(744)36%1,116187(500)(577)(220)(1,110)36%1,110Average debt costs of 4.6% (fixed) and2.3% (floating)Facilities extended post year-end byUS$150 millionExcludes uncommitted facilities of $310millionStable balance sheet; continued access to multiple debt marketsDebt maturity profile(including Letters of Credit)1 Maturity value of US$245 million12 months to31 Dec 2011US$m12 months to31 Dec 2012US$m12 Net debt/net debt plus equity2Strong liquidity and balance sheet position
  • 39. 21 March 2013 // Page 38Fully funded programmeFunding Outlook• Significant growth in cash flow– US$2 billion pa post-Catcher *– US$2.5 billion pa post-Sea Lion *• Surplus cash flows 2013-2015* beforediscretionary exploration spend• Gearing position unchanged through toSea Lion first oil at US$85/bbl• Forward profile funded by cash flow andfacilities down to US$65/bbl2500Investment Profile (development)(US$ million)201422502000175015001250100075050002502013 2015 2016 2017Standby Funding – Sea LionPremier* Assumes US$100/bbl
  • 40. SUMMARY //
  • 41. 21 March 2013 // Page 40What can you expect from Premier?Rapidly rising production and cash flow(kboepd)2011 20132012 Sea LionCatcher4065-7058100+100• Growing production• Quality execution of developmentprojects• Increasingly material and higherimpact exploration• Continuing portfolio management• Strong growth in cash flow generation– Commenced cash returns toshareholdersA continued focus on growingthe underlying NAV/share
  • 42. APPENDIX //
  • 43. 21 March 2013 // Page 42End 2012 2P reserves andcontingent resourcesFalklandIslandsIndonesia NorwayPakistan &MauritaniaUK Vietnam Total2P ReservesOn production - 36.2 - 28.2 29.7 28.0 122.1Approved fordevelopment- 36.0 - 5.6 19.8 7.0 68.4Justified fordevelopment- 25.0 - 0.8 74.3 1.4 101.4Total Reserves - 97.2 - 34.6 123.7 36.4 291.92CContingentResourcesDevelopmentpending193.7 - 71.5 2.5 4.2 - 271.9Development un-clarified / on hold32.7 68.0 0.1 16.2 16.7 13.2 146.9Development notcurrently viable6.2 4.9 2.3 12.8 28.7 7.2 62.0Total ContingentResources232.6 72.9 73.9 31.5 49.6 20.3 480.7Total Reserves & ContingentResources232.6 170.1 73.9 66.0 173.3 56.8 772.7
  • 44. Premier Oil Plc23 Lower Belgrave StreetLondonSW1W 0NRTel: +44 (0)20 7730 1111Fax: +44 (0)20 7730 4696Email: premier@premier-oil.comwww.premier-oil.com21 March 2013