BPC: A full-cycle E&P champion in the making - Presentation to Investec 29 October 2020 - cloudfront.net
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BPC: A full-cycle E&P champion in the making Presentation to Investec 29 October 2020
Disclaimer
This presentation (“Presentation”) has been prepared by Bahamas Petroleum Company plc (“BPC”) solely for purposes of providing introductory information on the Company and its projects. This Presentation should not be considered as
the giving of investment advice by the Company or any persons, including to any of its shareholders, officers or advisers. If you are in any doubt about the contents of this Presentation or the action you should take, you should consult an
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its projects may wish to receive for the purposes of assessment or valuation of that investment and is not intended to form the basis of any investment decision.
While the information contained herein has been prepared in good faith, neither the Company nor its shareholders, directors, officers, agents, employees, or advisors give, has given or has authority to give, any representations or
warranties (express or implied) as to the achievement or reasonableness of future projections, management targets, estimates, prospects or returns contained in this presentation, or in relation to the accuracy, reliability or completeness of
the information in this Presentation, or any revision thereof, or of any other written or oral information made or to be made available to any investor (all such information being referred to as “Information”).
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Investec Sales Desk Presentation, 29 October 2020 2 bpcplc.com
Introducing BPC
3
Presentation team: capable leadership with track record
Simon Potter Eytan Uliel Nathan Rayner
Chief Executive Officer Commercial Director Operations Director
• 40+ years’ oil & gas/mining experience • 25+ years’ oil & gas/resource experience • 20+ years’ oil & gas experience
• Previously CEO of Hardman Resources and Dart • Previously CCO / CFO of Dart Energy and • Previously COO of Dart Energy and senior
Energy, prior to that with BP and TNK-BP for 20 Arrow International; oil & gas / resource operations roles with Arrow Energy, Santos,
years private equity background Origin and Addax
$400m revenue $1bn I 2008 $3bn I 2012 $150m I 2014
BP Mature Assets group Sale to Tullow Oil Sale to Shell / Petrochina Sale to iGas Energy
Investec Sales Desk Presentation, 29 October 2020 4 bpcplc.com
Asset base summary
Perseverance #1 – Adds to Trinidad Low holding cost,
Production & cashflow,
“Company-maker” Production, high-impact
fast growth potential,
Drilling late 2020 Near-term cash exploration
exploration upside
results early 2021 generation optionality
• 5 producing fields
STATUS • Exploration Drilling • EWT Planning • Licence award
• ~450 bopd
• Saffron #2 appraisal well + then • Grow production
• Perseverance #1 result
2021 OUTLOOK development; grow production to 500 bopd, • Initial G&G work
• Define Perseverance #2 to 2,000 bopd, FCF incremental FCF
• P50 - P10 0.77–1.44 bnbbl
RESOURCE (unrisked recoverable) • > 230 MMbbl (unrisked • 24 MMbbl
POTENTIAL • 1 bnbbl
• B structure: >2 bnbbl STOIIP recoverable) in SWP (STOIIP)
up to 28 bnbbl
PRODUCTION • >100,000 bopd • >3,000 bopd • 500 - 1,000 bopd
• TBD
POTENTIAL (2025 – 2026) (2022 – 2023) (2021 – 2023)
Investec Sales Desk Presentation, 29 October 2020 5 bpcplc.com
Strategic outlook and direction of travel
Higher
Growing production HIGH-IMPACT
EXPLORATION – BAHAMAS
income supports access BPC’S “DNA”
to high-impact
exploration upside
IMPACT MEDIUM-TERM
& RISK PRODUCTION GROWTH
NEAR-TERM CASH GENERATION LOW COST, SHORT
CYCLE TIME
TRINIDAD AND TOBAGO DEVELOPMENTS SAFFRON #2 SWP EXPLORATION
APPRAISAL UPSIDE URUGUAY
EOR
PROJECTS
“SELF-HELP” INITIATIVES
PRODUCTION UPLIFT
SURINAME
GOUDRON & TRINITY
Lower INNISS PRODUCTION
Mature Development / Appraisal Proven Area Frontier
Fields Production Exploration Exploration
ASSET LIFE CYCLE
Current base:500 – 1000 bopd Near-term growth options: Build to 2,500+ bopd High-impact exploration upside
Investec Sales Desk Presentation, 29 October 2020 6 bpcplc.com
Assets
7
Trinidad (I/II) – Strategic portfolio approach TRINADAD & TOBAGO
SNAPSHOT OF CURRENT TRINIDAD ASSETS & OPERATIONS
Near-term Production – Enhancement Baseline Production
development – Stabilise
>200 MMbbl potential
resource
potential
Infrastructure-Led
Scale Exploration
Development
South West Peninsula (SWP)
SAFFRON
Appraisal +
Development + Production
>11 MMbbl c. 250 wells c. 450 bopd 2 owned rigs
5 producing
Saffron current
fields c. 65 staff 80+ producing 3 operating
Appraisal production
Investec Sales Desk Presentation, 29 October 2020 8 bpcplc.com
Trinidad (II/II) – Building profitable production TRINADAD & TOBAGO
BPC’s T&T STRATEGY – CLEAR & DELIVERABLE
1 Maintain baseline production from existing well stock 2 Enhance baseline production
OPPORTUNITY Baseline production provides cashflow to support cost of operations OPPORTUNITY Large production uplifts available at low cost
METHOD Application of a proven, mature asset mindset and skillset METHOD “Self-help” initiatives – EOR, field extensions, focused technical work
2020 TARGET Baseline of 500 bopd end 2020 = operational breakeven (at $40 oil) 2021 TARGET 20% - 35% sustainable increase to baseline production
OUTCOMES Increased production beyond baseline / oil price = surplus free cash OUTCOMES Translates to surplus cash generation
Low cost of operations: target < $20/bbl (incl G&A) Success proves capability and provide access to new opportunities
3 Production growth from Saffron discovery (drilled Q1 21) 4 Pursue exploration upside
OPPORTUNITY Immediately accessible production from appraisal of a known discovery OPPORTUNITY Substantial exploration upside is embedded in BPC’s T&T portfolio
METHOD Deliver Saffron#2 and field development: on-time, on-budget ($2m) METHOD Application of BPC core exploration expertise
2020 TARGET Saffron #2 drill early 2021 – unlocks the play and progresses overall 2020 TARGET Mature 2 new prospects capable of each producing up to 1,000
OUTCOMES Saffron development OUTCOMES bopd in a development scenario
Success case Saffron development = c.20 wells in 2 years, potential
to add mid-case peak production of up to 4,000 bopd
Investec Sales Desk Presentation, 29 October 2020 9 bpcplc.com
Bahamas (I/IV): Overview
12,600km2 Southern Licences (Bain,
Cooper, Eneas, Donald)
Historic wells
Proximity to services and
infrastructure from Gulf of Mexico
Cay Sal #1
No corporate tax or CGT, royalty
regime Cuban Oil Producing Fields
12 year exploration period BPC 3D Seismic
Survey Area Doubloon Saxon #1
30 year production right
Investec Sales Desk Presentation, 29 October 2020 10 bpcplc.comBahamas (II/IV): Middle East scale
Perseverance #1
Entire B
Structure over
70 km Long
Fold B
Top Cretaceous •
Aptian
Extends from 2000’ to 22,000’ and covers more than 100,000 acres
• Much larger than anything in the US Gulf of Mexico; comparable in size to
structures found in the Middle East
Fold C Fold C
Fold B Fold B Fold B Fold B
10 Kms
Bahamas foreland basin Bahamas foreland basin 10 Kms
Investec Sales Desk Presentation, 29 October 2020 11 bpcplc.comBahamas (III/IV): Perseverance #1
BPC Bahamas Value Proposition
• WORLD-CLASS, HIGH-IMPACT EXPLORATION POTENTIAL
Structure
• DRILL READY: ON SCHEDULE FOR SPUD IN LATE 2020 (Albian, Unrisked Recovery Unrisked Chance of
Aptian STOOIP Factor EUR Success
• 45-60 DAY DRILL PROGRAM, RESULT IN Q1 2021 only)
Billion Barrels % Billion Barrels %
B-North structure chosen for Perseverance#1 Fold B 5.5 20% – 25% 1.3 23% – 35%
Fold C 1.7 20% – 25% 0.4 28% – 35%
Lowest segment risk - Stacked play - Upper Jurassic thru Cretaceous mega bank & reef systems
Aggregate
Targeting P50 - P10 0.77–1.44 billion bbls (unrisked recoverable) 7.2 20% – 25% 1.7 23% – 35%
Total (1)
Entire B structure derisked by Perseverance #1 success Aggregate 1.6 – 3.3
Moyes & 8.3 – 28.0 (mean range)
Total B Structure most likely recoverable resource > 2 billion bbls Co (2017) (mean – upside)
20% – 40% 25% – 35%
(2)
5.6 - 11.0
(upside range)
Proceeding at pace for spud in late 2020 (1) As per RyderScott CPR (2011) based upon 2D seismic only
(2) Utilizing modern 2D and 3D
Environmental Authorisation approved
Stena IceMAX drillship, MPD on board
Drilling team in place, Covid-19 strategy and protocols enacted
Globally renowned service companies engaged
Long-lead and critical path items secured
Insurance cover placed
Well cost estimate $21 - 25 million (plus $5 million contingency)
Investec Sales Desk Presentation, 29 October 2020 12 bpcplc.comBahamas (IV/IV): A company making opportunity
PERSEVERANCE #1 – ONE OF THE TOP GLOBAL FRONTIER EXPLORATION WELLS ANTICIPATED IN THE NEXT 12 MONTH
One of the few wells to be drilled by a non-major – one of the few ways to invest in a high-impact exploration exposure
Consistent with BPC
internal resource
volume estimate
Source: Rystad & Westwood
Source: Westwood
Investec Sales Desk Presentation, 29 October 2020 13Suriname (I/I): Infrastructure led sales Uruguay (I/I): Low cost optionality
LOW COST ACCESS TO RAPID CASHFLOW POTENTIAL COMPARABLE TO EARLY-STAGE BAHAMAS
TESTS SUCCESSFUL, 500 – 1,000 BOPD PRODUCTION LOW HOLDING COST, UPSIDE POTENTIAL ADDRESS
Opportunity Opportunity
• 70 historic wells 114km • Analogous to offshore
2D seismic Guyana and Suriname
• Up to STOIIP 24 MMbbl • US$800,000 spend
commitment over 4
• Close to existing sales years initial term
infrastructure
• No drilling obligation
• If tests are successful,
15-20 production wells • Estimated Resource
in 2021/2022 Potential in excess of 1
billion barrels*
• Operations supported
from T&T at minimal
incremental cost
* BPC preliminary analysis based
on pre-bid G&G / technical work
Investec Sales Desk Presentation, 29 October 2020 14 bpcplc.comCommitment to ESG
TAKING ESG SERIOUSLY Company core ESG values – KEY 2021 PLANS & FOCUS
• Active commitment to transition to aligned Consistent with and guided by
ESG operating and reporting framework Global Reporting Initiative (GRI) Measurement
• Measure key metrics
• Board Committee responsibility direct Sector Standards for Oil & Gas
reporting • Establish company-wide baselines
• First comprehensive ESG report in 2021 Targets
• Define impact reduction and
• Investment in senior personnel to propel ESG Accountability
continuous improvement targets
efforts and leading culture change
• Deliver positive engagement on core issues of Communication
health, safety, environment and communities Efficiency Transparency &
Governance
Engagement • Engagement and buy-in of staff to
Climate
Change & Communities values and metrics
Energy
Diversity
ESG • Promote company-wide diversity
Environment &
• Skills and competency
Employment
Biodiversity development delivered through
Dr. Parbodh Gogna Roberta Quant No Harm
Health &
Inclusion training, on-the-job experience
Safety
HSE&S & Government Environmental Scientist and opportunities
Relations Director
17 years’ experience in the
30 years’ active medical practice,
environmental field; previously
Zero
emergency and communicable
disease management, border and
worked with the Bahamas Incidents
Environment, Science and
multicultural affairs. Special Forces
Technology (BEST) Commission.
active service.
Investec Sales Desk Presentation, 29 October 2020 15 bpcplc.comInvestment Proposition
16Activity Timeline: value creation over the next 24 months
H2
2020 2021 2022
Licences (activity)
Bahamas South (Perseverance #1 / exploration)
Bahamas South (Perseverance appraisal)
SWP (Saffron appraisal)
SWP (Saffron development)
Goudron (Production / water injection)
Inniss-Trinity (CO2 pilot)
Trinidad Exploration (3D reprocessing)
Weg Naar Zee (Extended well tests)
Weg Naar Zee (Development wells)
T&T production fields (Development well)
OFF-1 (Early stage exploration)
NOTE: 2021 / 2022 indicative schedule subject to change and further operational announcements by the Company Offshore drilling Onshore drilling Milestones
Investec Sales Desk Presentation, 29 October 2020 17 bpcplc.comActivity Timeline: high leverage to news-flow Investec Sales Desk Presentation – 29 October 2020 18 bpcplc.com
Building value through 2021
TARGETTING MATERIAL PRODUCTION GROWTH & EXPLORATION ACTIVITY IN 2021
VALUE DRIVER ACTIVITY CAPEX SPEND ILLUSTRATIVE VALUE OUTCOMES
2,500 BOPD BY END 2021 END 2021 FINANCIAL GOALS
PROFITABLE Up to $20m Capex – $35m+ revenue run-rate (annualized)
Achieve baseline 500 bopd
Incremental Production,
PRODUCTION 20%-35% “self-help” initiatives Development (Saffron),
$15m operating cashflow run rate
(annualized) – positive FCF (pre capex)
GROWTH Production ramp-up from Saffron Suriname EWT
development in Trinidad and Suriname 10 MMbbl 2P reserves (net)
END 2021 EXPLORATION GOALS
EXPLORATION DELIVERY Bahamas P1 – up to $30m
ACCESS (including contingency) Bahamas discovery – multi-billion
Perseverance#1 in The Bahamas
EXPLORATION Trinidad SWP Exploration -
barrels, P2 & farm-in progress
SWP Exploration in Trinidad Trinidad – additional 2 prospects of
UPSIDE TBD
equivalent size to Saffron
Investec Sales Desk Presentation, 29 October 2020 19 bpcplc.comFinancial Summary
DISCIPLINED FINANCIAL MANAGEMENT & FUNDING STRATEGY – MANAGEMENT WHO BEHAVE LIKE OWNERS
CURRENT LINE OF SIGHT TO +$40 MILLION FUNDING
Market Metrics Current Capital Structure
Ticker (LSE AIM) BPC Current funding(1) c. $23 million
Share price (23/10/20) 2.53p / share Undrawn conditional convertible notes US$13.3 million
Market cap £100 million
Debt Nil
Ordinary Shares on Issue c. 4 billion
Options & Warrants outstanding c. 270 million Net assets (proforma as at 31/12/19) $85.9 million
Board & Management ownership c. 9.9%
Additional potential funding sources:
• Income from production
• Reserve based lending (RBL) options
• Farm-our discussions and strategic partnering options
• “Drill for equity” type arrangements
• £16.0 million variable conversion price note facility: £11.3 million undrawn
(1) Comprises cash balance disclosed as at 30/06/20, $12 million gross placing proceeds as disclosed 01/10/20, prepaid well costs
Investec Sales Desk Presentation, 29 October 2020 20 bpcplc.comConclusion: a full-cycle E&P company
Regional champion – the only full cycle E&P +$40m funding
1 cash + undrawn facilities
player in the region + multiple funding options available
Current production and proven resources in 2,500 bopd
2
Trinidad & Tobago 2021 net daily production goal
3 Cash generative low-cost operations, production >$ 15 million
success drives increasing cashflow 2021 net revenue goal (run-rate pa)
4
Operational improvement, Appraisal and short >50 MMbbl
cycle development programme underway 2025 net 2P reserves goal
Attractive near-term transformational growth Q1 2021
5
prospects in The Bahamas (Perseverance #1) Perseverance #1 well (Bahamas) - High impact/upside
Saffron #2 well (Trinidad) – rapid production and cashflow
The right management team with the right sector
6
and regional expertise 100+ years
Management experience
Investec Sales Desk Presentation, 29 October 2020 21Appendix
BPC Board
Simon Potter Bill Schrader James Smith
Chief Executive Non-Executive Chairman Non-Executive Deputy
Officer Chairman
• 40 years’ oil & gas / mining experience • 40 years’ oil & gas experience • Former Minister of State in the Ministry of
• Previously with CEO of Hardman Resources and • Previously with BP as CEO of several country Finance, member of the Bahamas’ Senate and
Dart Energy and with BP and TNK-BP for 20 years operations and COO of TNK-BP Governor of the Central Bank of the Bahamas
Adrian Collins Ross McDonald Leo Koot
Non-Executive Director Non-Executive Director Non-Executive Director
• Worked in fund management for over • Served 35 years with RBC, most recently SVP & • Nearly 30 years’ oil and gas industry experience,
35 years, largely with Gartmore IM. Chairman of Head of Caribbean Banking senior roles in finance and operations in Middle
Liontrust AM East and international companies
Investec Sales Desk Presentation – 29 October 2020 23 bpcplc.comBPC Executive Team
Eytan Uliel Ben Proffitt Nathan Rayner Dr. Parbodh Gogna Randy Hiscock
Commercial Director Finance Director Operations Director HSE & S Government Business Development
Relations Director Director
Jobeth Coleby Davis Dave Bond Roberta Quant Geoffrey Leid Jane Bond
General Counsel Drilling Director Environmental Scientist Trinidad GM Subsurface Manager
Investec Sales Desk Presentation – 29 October 2020 24 bpcplc.comOur Journey
2006 – 2018 2019 – PRESENT 2020 – PRESENT
Extensive technical work in The Bahamas Progress to high-impact exploration drilling Transformation into full-cycle
to de-risk play; >$100m spent in The Bahamas E&P business
2006 2018 2019 2021
KEY EVENTS KEY EVENTS KEY EVENTS
2006 – 2007 2015 Feb 2019 Feb 2020 May 2020 Aug 2020 Dec 2020
2008 2017
Concept incubated Extension of Extension of 2nd Environmental Acquisition of
RTO into BPC Bahamas Rig contract with Spud Perseverance #1
in Hardman licences 2nd exploration period and Authorisation for Columbus to become
General Election Stena Drilling - IceMAX in The Bahamas
Resources exploration term firm well obligation drilling received full-cycle E&P business
2007 2011 2016 2018 March 2019 March 2020 June 2020 Sept 2020 Q1 2021
3D seismic Submitted
Bahamas Licences New Bahamian “Go it alone” strategy Covid-19 delay of Award of OFF-1 Engage 3rd Rig - Drill Saffron #2 in T&T
campaign Environmental
awarded regulatory regime for The Bahamas Perseverance #1 well licence in Uruguay increase activity 30% Perseverance #1 result
($45m cost) Authorisation
JUNE 2017 – OCTOBER 2018 FEBRUARY 2019 TO PRESENT
Farm-out process, including extensive supermajor DD & paid exclusivity Operational readiness for Perseverance #1 drilling – contractors, planning, logistics, funding
Investec Sales Desk Presentation, 29 October 2020 25 bpcplc.comThank you
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