Proactive Investors Conference Shelbourne Hotel - 28 February 2012 Tom Hickey
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Proactive Investors Conference
Shelbourne Hotel
28 February 2012
Tom Hickey
• Company Overview and Strategy
• Algeria
•History
•Appraisal Results
•Development Planning
• Kurdistan Region of Iraq
• Italy
2
Corporate Overview
Petroceltic (AiM: PCI.L; IEX, PCI.ID) • Highly experienced team with Major E&P
Ordinary Shares in Issue 2,370 mm Company backgrounds
• Board
Market Capitalisation – Stg£ 208.4 mm
• Management
Market Capitalisation – US$ 330 mm • Technical and Commercial Teams
52 Week High-Low, Stg p 3.8 – 13p
• Recently completed 6 well appraisal
Average Daily Liquidity 13.4 mm shares
programme on multi-TCF gas condensate
Top 20 Holders(at 31 Dec 2011) 60.70% field development in Algerian Sahara Desert
• Major project, sanction in 2012, first
gas in 2017
• Recent entry into Kurdistan Region of Iraq,
2 Highly Prospective Blocks with Hess
• Over $100 mm received from ENEL in Feb
2012 , further $25-$50mm in 2012
• $30 million Macquarie Facility fully repaid
• Actively seeking new projects in MENA
region
3
A Clear Strategy To Add Value
Appraise and Monetise Algerian Asset
• Multi-Well appraisal campaign successfully completed
• Farm-out to Enel concluded
• Field “Final Discovery Report” to be filed imminently
Diversify and Balance our Business
• Maintain focus on MENA
• Skills/Expertise focus extends throughout Africa/Middle East
• Target to secure low risk post-appraisal plays
Target Transformational Growth
• Acquire or discover assets with material resource potential
• Target high initial equity interests with operator status preferred
• Active risk mitigation through farm-out and partnering strategy
• Prepared to be Opportunistic
4
Petroceltic’s Current Core Areas
• Core areas in Algeria, Kurdistan Region of Iraq and Italy in which Petroceltic
has multiple potential „company makers‟
• Significant exploration potential identified
• A portfolio of Oil and Gas Development opportunities
Isarene Permit – 6
well appraisal
campaign in 2011
5
Algeria Gas Infrastructure Natural Gas Market & PCI’s Isarene Permit 6
Isarene Permit Location South Illizi Basin 7
Algeria: Successful Appraisal Programme
Well Type Objective Comment
AT-4 Vertical GIIP Outside Glacial Valley AT-8
AT-5 Pilot + Flow Rate Pop-Up (1)
Horizontal
AT-6 Vertical GIIP SE Valley AT-9
AT-7 Vertical GIIP SW Valley
AT-8 Vertical GIIP/Flow Northern Area
Rate
AT-9 Pilot + Flow Rate Pop-Up (2)
Horizontal
• 2011 drilling programme moves project towards bookable
recoverable reserve status in 2012
• Major GIIP Upgrade from appraisal programme
• AT-9 Flowed 67.6 mmscfd pre-fraccing –demonstrating
potential for high deliverability within Ain Tsila complex and
underpinning commerciality
8
Ain Tsila Gas-Initially-in-Place (“GIIP”)
• Appraisal wells have demonstrated greater gas columns and better than
expected reservoir properties - close to, or better than P10 predictions
• The range is still wide due to the large field area relative to the number of wells
• Appraisal well “step-outs” are typically >10 km
• Entire North Sea fields would fit into the gaps!
• High quality seismic covers only a part of Ain Tsila
• With a 30 year field life, higher GIIP is a key source of long-term value
Case GIIP – TCF *
Low 5.7
Mid 10.3
High 20.8
* Current Petroceltic Internal Estimates
9
Ain Tsila Ordovician Analogues – It’s been done before
• Tignuentourine (BP/ Statoil)
– 1000 MMscf/d wet gas plateau
– ~30 wells, 3 trains
• Tin Fouye-Tabankort (Total/ Repsol)
– 700 MMscf/d wet gas plateau with
– ~40 wells, 2 trains
• Ohanet (BHP Billiton)
– 350 MMscf/d wet gas plateau
– ~12 wells, 2 trains
• Key Development Issues
– Distribution of „good‟ facies
– Distribution & density of open fractures
– Optimisation of hydraulic frac design
– Learning while drilling (tie to 3-D seismic)
• Experienced PCI team
– Ex Burlington, BHP Ohanet – directly relevant
experience
10Summary of Ain Tsila Development Concept
• Mid Case development scenario - Region 1
economically and technically robust High perm.
• Projections based on field “Sector High Fractures
Models” supported by appraisal evidence Region 2
Low high perm.
• 11-13 yr wet gas plateau rate of 400 High Fractures
mmscfd
• 654 MMboe saleable volume Region 3
• 35 wells pre first gas, > 200 wells in total, Low high perm.
• 2.4 TCF dry gas Medium Fractures
• 106 Mmboe condensate
• 109 Mmboe LPG
• Simple single train central processing
Region 5
facility, to standard industry design Region 4 No high perm.
• Significantly positive economic outcome High perm. Low fractures
for Algerian State Low fractures
• AT-9 result indicates scope for further
productivity upside – well above high-
case expectations
11Ain Tsila Outline Development Plan
First Gas
600 2,000
Cumulative Gross Capex MM USD
1,800
500
Gross Capex MM USD
1,600
400 1,400
1,200
Self
300 Financing
1,000
800
200 600
100 400
200
- -
2014 2015 2016 2017 2018
Year
Drilling Facilities Cumulative
• 35 wells to establish 400 MMscf/d wet gas plateau
• Around 200 wells in total to maintain plateau for 11-13 years, 2-3 rigs/ annum
• Gas calorific value of 1045 btu/cf
• Condensate yield 41.7 bbl/mmscf, Liquified Petroleum Gas (LPG) yield 42.9 bbl/mmscf
12Ohanet Central Processing Facility
Gas/
LPG Condensate/
spheres LPG export
Flare stacks
Condensate Gas
tanks compression
Two 350 MMscf/d Evaporation
processing trains ponds
Slug catcher
13% From Algeria
% From Libya
16%
33 34 12
% % 33 %
% 13
%
16
%
14Enel Farmout
• Enel Farm-out Announced 28th April 200
• $36.75 million in historic costs
180
• 2 for 1 Appraisal Carry– to max of $71
160
million ($145 million programme)
Contingent
• Reserves-Based contingent consideration 140 Payments
up to $75 million 2011/12
120
Contingent Bonus
• Maximum potential attributable value of c.$1 US$M
Contingent Carry
100
billion to overall Isarene project (PCI 56%) Costs- Enel
• Farm-out fully approved 80 Work Carry - PCI
Back Costs
• PSC Addendum signed 28 April 60
• Government Ratification – 18 Dec 2011 40
Firm
• Initial payment (cUS$101million)received Payments
20 2011
February 2012
0
• Contingent Payment Q3 2012 Value
15Kurdistan Region of Iraq – High Impact Exploration Blocks 16
Dinarta and Shakrok Blocks - Transaction Overview
• Petroceltic has a 20% interest (16% participating
interest) in two highly prospective blocks in the
Kurdistan Region of Iraq
• Hess Middle East is operator of both blocks with an
80% interest (64% participation)
• Kurdistan Regional Government (KRG) has a 20%
carried interest
• Blocks were approved by the KRG on 27 July 2011,
PSC‟s fully agreed and signed.
• First Phase Financial Commitment of appx. $72
million net to PCI, inclusive of all Signature and
Capacity building Bonuses
• Recent material entrants and fundings include Hess,
Maersk, Repsol, Afren, Vallares, Gulf Keystone,
Exxon Mobil and Total
Dinarta and Shakrok both undrilled and on trend with major discoveries
17Kurdistan Region of Iraq
Emerging World Class Province – Acreage Awards & Rapid Discovery
2007 2011
18Dinarta: Very Significant Exploration Potential
Major undrilled anticlines adjacent to world-class discoveries
• Joint Venture: Hess 64%, PCI 16%, KRG
20% (carried)
• Unexplored 1,319 sq km block with major Shireen
surface structures and extensive oil
seeps
• Multiple leads, each with very significant
reserve potential across multiple horizons Chinara
• On trend with Shaikan, Atrush and
Swara Tika oil discoveries Bradost
• Demonstrated regional productivity
• First phase work programme 500 km 2D
and 1 Exploration well Dinarta Block
• Operations to commence 2012 – 2D - 1319 sq km
seismic crews currently mobilising to field 10km
19Shakrok: Significant Exploration Opportunity
Undrilled anticlines on trend with Taq Taq field
• Joint Venture: Hess 64%, PCI 16%, KRG 20%
(carried)
• Unexplored 418 sq km Block with major surface
structures and extensive oil seeps Shakrok
• Leads with billion barrel potential across multiple
horizons
• Adjacent Taq Taq field (Addax/Sinopec)
produces 60,000 boepd of 46° API oil
• Offsetting Bina Bawi oil discovery
Pelewan
Shakrok Block
• First phase work programme 250 km 2D and 1 418 sq km
Exploration well 10km
• Operations to commence 2012 – 2D seismic
contract recently awarded
20Kurdistan Region of Iraq
Undrilled Surface Anticlines
Undrilled Pelewan Anticline, Shakrok Block
21Italy – Building for Success 22
Petroceltic Italia
Major value creation potential in Italy (in spite of DL 128…)
• E&P activity continues despite challenges
created by DL128
• Onshore
• Offshore outside 12 mile zone
• Rovasenda - potentially transformational
• Planned 4Q 2012 spud
• Risk mitigation via farm-down
• Strongly positioned to exploit success
• Offshore Abruzzo
• BR268 suspended for duration of legal
appeal
• Applications outside 12 nautical mile limit
progressing towards award
23Petroceltic Italia
Western Po Valley Core Area
2010 Award of Ronsecco Permit
2011 Transfer of Carisio Operatorship to Eni effective
– Licence for all seismic data in Carisio & Ronsecco
2012 Rovasenda Well – permitting, site selection, commercial planning, PCI farmout, drilling
preparations.
24Petroceltic Italia
Offshore Abruzzo Core Area
Granato
• BR268 suspended pending judicial review 35 mmbbl PR
• E&P restricted within 5-12 nautical miles of
coastline (DL 128)
• Extension of high-graded Elsa
play fairway into outboard area
– Environmental applications approved for
4 of these applications; 1 pending
– Expectation that licences will be
awarded in 1H 2012
• Fast-track technical evaluation once licences
Opale
awarded – with seismic acquisition
220 mmbbl PR
25Corporate Overview
Petroceltic (AiM: PCI.L; IEX, PCI.ID) • Highly experienced team with Major E&P
Ordinary Shares in Issue 2,370 mm Company backgrounds
• Board
Market Capitalisation – Stg£ 208.4 mm
• Management
Market Capitalisation – US$ 330 mm • Technical and Commercial Teams
52 Week High-Low, Stg p 3.8 – 13p
• Recently completed 6 well appraisal
Average Daily Liquidity 13.4 mm shares
programme on multi-TCF gas condensate
Top 20 Holders(at 31 Dec 2011) 60.70% field development in Algerian Sahara Desert
• Major project, sanction in 2012, first
gas in 2017
• Recent entry into Kurdistan Region of
Iraq, 2 Highly Prospective Blocks with Hess
• Over $100 mm received from ENEL in Feb
2012 , further $25-$50mm in 2012
• $30 million Macquarie Facility fully repaid
• Actively seeking new projects in MENA
region
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