Pa resources q1 2013 results 24 april 2013


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Pa resources q1 2013 results 24 april 2013

  1. 1. First Quarter 2013Bo Askvik,President & CEOStockholm, 24 April 2013
  2. 2. 2Production and sales in Q1bopd Full-year2012Q12013March2013West Africa 5,600 4,800 4,700North Africa 2,300 2,000 1,900Group Total 7,900 6,800 6,600• ASENG: Average production level of approx.60,000 boepd in Q1 (3,400 net to PA Resources),vessel’s gas handling capacity being assessed• AZURITE: Production impacted by intermittent wellinstability, operator assessing field’s way forward• TUNISIA: Onshore production impacted by wellintervention, successfully completed in March• PRICE: PA Resources realised price of USD 113per barrel equal to Brent averageAverage production per country (bopd)Average sales price (USD/bbl)97109 106 104120109 109 106113106117 113 109119108 109 110 11320406080100120140Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013PA Resources Brent02 0004 0006 0008 00010 000Q12011Q22011Q32011Q42011Q12012Q22012Q32012Q42012Q12013Congo: Azurite EG: Aseng Tunisia: Didon & Onshore
  3. 3. Earnings and key ratios3Q1 2013 Q4 2012 FY 2012Production (bopd) 6,800 7,100 7,900Oil price (USD/barrel) 113 106 111Revenue (SEK million) 446 467 2,184EBITDA (SEK million) 242 266 1,255Profit before tax(SEK million)*131 -16 85Profit for the period(SEK million)34 -340 -1,966Earnings per share (SEK)** 0.003 -0.19 -1.93* Figures for Q1 2013 exclude non-cash, one-off costs of SEK 21 million. Figures for Q4 andfull-year 2012, exclude non-cash, one-off costs of SEK 169 million respectively SEK 1,748 million.** The righs Issue in February 2013 gave rise to retrospective adjustmentsKEY COMMENTS Q1 vs Q4• Positive net result of SEK 34 million inline with communicated estimate• Stable net costs of SEK 204 millioncompared with SEK 201 million in Q4• Royalty levels flat• Direct cost in connection to plannedAzurite sidetrack of SEK 21 millionpresented as one-off costs• Financial net positively impacted byweakened NOK and reduced debtfollowing convertible bond set-off issue
  4. 4. Cash flow4SEK millionQ1 2013 Q4 2012 FY 2012Operating cash flow -70 175 838of which incometaxes paid-54 0 -5CAPEX -58 -186 -255Financing activities 359 65 -568Net cash flow 231 54 15KEY COMMENTS• Operating cash flow of SEK -70 millionmainly relating to reduction of accountspayable and other liabilities in connectionto Azurite sidetrack• Income taxes of SEK 54 million relatingmainly to one-off payments in Tunisia andEquatorial Guinea• Capex of SEK 58 million, at the lower endof the forecast range• Righs issue of SEK 604 million, net aftertransaction costs• Amortisations of SEK 245 million in Q1• Cash and cash equivalents at the end ofthe period amounted to SEK 288 million
  5. 5. Current equity and debt situation5KEY COMMENTS• Recapitalisation restored Equity andBook equity/Capital employed aboverequirement in covenants• Amortisations of SEK 245 million in Q1• Net debt reduced to SEK 2,111 millionEquity and net debt before and after recapitalisation (SEK million)Q1 2013 Q4 2012 Q3 2012 CovenantBook Equity (SEKmillion)2, 201 1,590 956 >2,000Book Equity toCapital Employed48% 37% 22% >40%Net debt (SEKmillion)2,111 2,630 3,410 N/ACovenants and Net Debt development9563,4102,201 2,11105001 0001 5002 0002 5003 0003 5004 000Equity Net Debt30 Sept. 2012 31 March 2013
  6. 6. Capital expenditure 2013 forecastActual ForecastedCapex development and forecast (SEK million)KEY COMMENTS• Capex in Q1 amounted to SEK 58 million,at the lower end of the forecast range• Main part of Q1 investments relates to WestAfrica/Azurite sidetrack• 2013 forecast of SEK 250 – 380 millionunchanged assuming no farm-outs reducinginvestments61,61325558250-38002004006008001 0001 2001 4001 6001 8002011 2012 2013MSEK58
  7. 7. Capex forecast and drilling programmeDK: 12/06 Lille John 2013/2014Appraisal/Exploration/1-2EG: Block I Carla South Ongoing Exploration/1EG: Block I Diega 2013 Appraisal/1EG: Block H 2013 Exploration/1NL: Q7/10a Q7-FA 2013/2014Appraisal/Development/1Tunisia: Zarat Elyssa 2013/2014 Appraisal/1Tunisia: Makthar 2014 Exploration/1Drilling programme/planned wells 2013-2014Capex forecast 2013 includes:• Drilling campaign ín Block I in EG, CarlaSouth exploration ongoing• Drilling campaign on 12/06 high priority• Drilling on 12/06, Block H and Q7/10adependent on rig availability• Operational expenditures in producingfields• Elyssa well assumes successful farm-outof Zarat licence• The drilling programme is revisedcontinuously based on the capex budgetand prioritised commitments7
  8. 8. PA Resources’ strategy and focus82013 - 2018Development ofprioritised projectswith reduced risk>> LONG TERM GROWTHDevelopment of ~ 32 mmboe forlong-term production growth>> BALANCED INVESTMENTSFarm-out of assets reducing invest-ments and risk, financing from produc-tion and debt financing at lower level
  9. 9. Business and investment plan 2013 – 20189KEY ASSUMPTIONS:Development is not progressed until farm-outsuccessful• Continued operational expenditures onproducing fields• Development of existing reserves andresources of 155 mmboe will after farm-out add32 mmboe• Farm-out of prioritised assets to reachpreferred working interest level and reduce riskon individual assets» Zarat licence from 100% to 20%» Didon field from 100%% to 50%» 12/06 from 64% to 15%• Present operatorship in farm-out assetssecures development planning• Oil price of 110 USD/bbl and USD/SEK of 6.53Capex forecast 2013-2018 before andafter farm out transactions (SEK million)1,613255 170270540 590230520680970300002004006008001 0001 2001 4001 6001 8002011 2012 2013E 2014E 2015E 2016E 2017E 2018EPA Resources share of investments Partners share of investments
  10. 10. Expected outcome of planned development10KEY ASSUMPTIONS:• Development of existingreserves adding after farm-out32 mmboe for long-termproduction growth• Debt maintained aroundcurrent level• Expected net cash position in2018Estimated development of net debtand average production02 0004 0006 0008 00010 00012 00014 00016 000-1,00,01,02,03,04,05,02010 2011 2012 2013E2014E2015E 2016E2017E2018EbarrelsperdaySEKbillionNet debt actual Production Net debt estimate
  11. 11. Operations & OutlookQ1
  12. 12. 12Operational updateHIGHLIGHTS• EG: Carla South exploration well in Block I spuddedbefore Easter• EG: Alen field development in Block I nearingcompletion below budget, targeting first production inQ3 2013• Congo: Azurite field production impacted byintermittent well instability likely to continue, operatorcontinues to assess the field’s way forward• Congo: MPS operator has withdrawn fromexploration area increasing PA Resources workinginterest from 35% to 85%, licence extended for furtherevaluation• Tunisia: Zarat farm-out process and unitisationprogressing• Tunisia: Evaluation of onshore Jelma and Maktharlicences finalised, tender for Makthar seismic surveyin 2013 issued
  13. 13. EG Block I – Carla South exploration well ongoingPA Resources 5.7%• 2013 drilling programme with Atwood Hunter rig• Progressing two exciting fields towards develop-ment1. Carla North and South» 2011 discovery in adjacent Block O (’CarlaNorth’) appraised 2013 in Block O, whereoperator has announced additional oilreservoir found» Carla South exploration well spudded beforeEaster, expected duration around 25 dayswith planned subsequent sidetrack of similarduration and possible testing2. Diega» Expect appraisal well and 3 to 4 weekproduction test in Block I Q3 201313Licence Group: Operator Noble Energy (38%), Atlas Petroleum(27.55%), Glencore (23.75%), PA Resources (5.7%),GEPetrol (5%)Block I Drilling programCarla South1 2
  14. 14. Congo – Remaining potential in extended MPSPA Resources 85%• PA Resources granted additional 50% workinginterest and operatorship, licence extended byauthorities until November 2013• Prospect and lead inventory at variousstratigraphic levels» Miocene (proven play)» Albian (proven play on the shelf,developing play in deep water)» Possibly pre-salt (frontier play)• Miocene inventory to be re-interpreted on the2011 reprocessed 3D data which is bettersuited to evaluation at this level• Intention during extension period to seekfarmees/farmee operator to progressexploration14Licence Group: Operator PA Resources (85%), SNPC (15%)Mer Profonde Sud – exploration licence area
  15. 15. Denmark 12/06 - Progressing discoveriesPA Resources Operator with 64%• High quality Middle Jurassic reservoir proved by wells• Mid to high case assessment of c. 25-50 mmboe grossof contingent resources including liquids• Technical and commercial studies continuing towards ayear end decision point on either appraisal drilling or tomove into development Front End Engineering Design(FEED)• Ongoing discussions with owners of infrastructure for tieback as one of range of possible development concepts• Wells established 35 API oil in Miocene sandstoneat c. 900m – exceptionally light oil for shallow depth• Remaining deeper potential likely – Chalk and MiddleJurassic• Efforts to locate available rig for appraisal drilling continuein tight rig market• Development options dependent on appraisal results –successful appraisal could lead to tieback to nearbyinfrastructure or standalone development15Licence Group: Operator PA Resources (64%),Nordsøfonden (20%), Spyker Energy (8%), Danoil (8%)B20008-7312/06 Broder Tuck-2Lille John-1Broder TuckLille John
  16. 16. Tunisia: Significant onshore exploration acreageTunisSfax4312Algeria LibyaTunisia1Makthar PermitTunisSfax4312Algeria LibyaTunisiaProducing Asset11Jelma Permit21Douleb, Semmama& Tamesmida31Jenein Centre Permit4Exploration AcreagePA Resources onshore assets:• Jelma-Makthar permits surroundproducing Douleb, Semmama andTamesmida (DST) fields onshore Tunisia• Both permits cover areas of 7,216 km²and 3,828 km², contains several onshoreexploration prospects• Successful exploration and productionhistory in the region, Serdj play provedas working petroleum system for DSTfields• Shell preparing drilling in adjacentlicence16
  17. 17. • Seismic program targeting definedMakthar prospects and near fieldpotential• Prepared and submitted impactstudy, approval expected mid April• In progress with tender evaluation• Planned program of approx.500 kmMakthar Permit: 2D Seismic programPA Resources Operator with 100%17Makthar Permit
  18. 18. Largest shareholders and Nomination Committee18The 10 largest shareholdersper 28 March 2013Capital/votesGUNVOR GROUP LTD 9.9%AVANZA PENSION 6.8%CREDIT AGRICOLE (SUISSE) SA 3.8%AB TRACTION 3.0%NORDNET PENSIONSFÖRSÄKRING AB 2.8%ÅGERUP FASTIGHETER AB 2.7%LUX-NON-RESIDENT/DOMESTIC RATES 1.9%JP MORGAN BANK 1.7%SEB S.A. 1.7%ORIGINAT AB 1.4%10 largest shareholders 35.7%Other shareholders 64.3%Total 100.0%NOMINATION COMMITTEE• Sven A. Olsson (Gunvor Group Ltd),Chairman of the Nomination Committee• Bengt Stillström (AB Traction)• Göran Ågerup (Ågerup Fastigheter)• Hans Kristian Rød, Chairman of the BoardThe Nomination Committee’s proposal regardingthe Board of Directors, election of auditors,remuneration and more will be published aheadof the AGM on 14 May 2013.
  19. 19. Reverse share split19SUMMARY• The EGM on 9 April 2013 resolved in favour of a reversed sharesplit and a minor new share issue of 28 shares• 500 present shares are consolidated into one share, with recorddate 2 May 2013• Shareholdings is rounded off downward, any excess shares willcome under the Company’s ownership and is thereafter sold• Proceeds to be automatically distributed among the owners• Friday 26 April is the last trading date before the reverse splitand Monday 29 April the first trading day after the reverse split• Following the reverse split the total number of shares inPA Resources amounts to 28,291,998
  20. 20. Strategy and outlook>> STRENGTHENED BALANCE SHEETCapacity to finance development capex and planned amortisations,enhanced position for future transactions>> DRILLING TO PROGRESS DISCOVERIES TO DEVELOPMENTLow risk appraisal and exploration: Block I campaign ongoing,12/06 campaign targeting 2014, Elyssa appraisal targeting 2013/2014>> FOCUS ON ADDING LONG TERM PRODUCTION GROWTHFocus on farm out of prioritised assets, targeting 32 mmboe indeveloped reserves (after farm-out) - expected net cash position in 2018>> OPERATING CASH FLOW FROM PRODUCING FIELDSCash flow with highly profitable barrels from the Aseng field– foundation for growth20
  21. 21. Thank you!Q1Q2 Report on 14 August 2013