1999 PRELIMIN ARY RESULTS 1999 PRELIMIN ARY RESULTS PRESEN TATIO N - - PowerPoint PPT Presentation

1999 PRELIMIN ARY RESULTS 1999 PRELIMIN ARY RESULTS PRESEN TATIO N PRESEN TATIO N

13th March 2000

1999 Preliminary Results Presentation

Introduction Overview Results Operations Summary

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PRESENTATION

Sir David John Charles Jamieson John van der Welle Steve Lowden Charles Jamieson

Strategic Financial Operational Exploration Portfolio

1999 HIGHLIGHTS

• new alliance with Amerada Hess and Petronas
• balance sheet strengthened
• major gas developments on track
• successes in Pakistan and Indonesia
• rationalisation continues

1999 Preliminary Results Presentation

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Strengthened finances

• £136 million equity injection
• $158 million Yetagun financing
• $200 bank debt refinancing
• Reduced capex and overheads

1999 OBJECTIVES AND DELIVERY

Asian Gas focus

• Operated $650 million Yetagun project built
• West Natuna gas project progressing on schedule
• Significant Naga discovery - potential 2nd gas sale
• Zamzama appraisal success - EPS agreed
• Agreement to investigate new gas pipeline in Pakistan
• Strategic alliance

1999 Preliminary Results Presentation

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RESULTS

1999 Preliminary Results Presentation

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1998

1999 RESULTS SUMMARY

1999

Realised oil prices ($/bbl) (post hedging) Production volume (mboepd) Turnover Operating profit before exceptionals Loss after tax Operating cashflow (after interest and tax) Capital expenditure (including JV’s) Net debt (including JV’s) Gearing (including JV’s) 13.67) 35.5) 105) 5) (137) 33) 164) 289) 148) 14.93) 29.1) 89) 8) (28) (2) 132) 267) 87)

£m £m

% %

1999 Preliminary Results Presentation

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PROFIT & LOSS ACCOUNT

Production (mboepd) Realised oil price ($/bbl) Turnover less: share of JV’s turnover Group turnover Production costs Amortisation Exceptional provision Gross profit / (loss) Administration costs Operating (loss) / profit Operating profit in JV’s Total operating loss Profits on disposals Net interest Exchange gain / (loss) Loss before tax Taxation Loss after tax Dividend Retained loss Earnings per share - basic and diluted (pence) 29.1) 14.93) 89) (5) 84) (31) (38) (14) 1) (10) (9) 3) (6) 3) (14)

• )

(17) (11) (28)

• )

(28) (2.5)

1998 (restated)

35.5) 13.67) 105)

• )

105) (42) (53) (121) (111) (5) (116)

• )

(116)

• )

(13) 1) (128) (9) (137)

• )

(137) (13.2)

£m 1999

Hedging loss - £14m (1998 - gain £6m) Unit opex at £2.69/boe unchanged on 1998 DDA decreased by £15m due to fall in production and lowering of DDA rates per boe as a result

• f 1998 FRS11 write

down Write down of Southern Europe pool Includes restructuring costs Production down 18% due to natural field declines, Fife shutdown and Pakistan JV Sale of Trinidad and

• ther fixed assets

Increased PRT on Wytch Farm

£m

1999 Preliminary Results Presentation

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CASHFLOW

Net cashflow from operations Net interest Taxation Operating cashflow (after interest and tax) Capital expenditure Disposals (net) Dividend Net cashflow Share subscription Yetagun financing receipt / advance from JV partner Exchange Movement in net debt Opening net debt Closing net debt 32) (22) (12) (2) (101) 47)

• )

(56) 134) 47) (9) 118) (289) (171)

1999 (as reported excluding JV’s) £m

57) (8) (16) 33) (164) 3) (4) (132)

• )

16) 2) (114) (175) (289)

1998 £m

Lower taxes on lower profits Build-up capital expenditure Fall in line with revenue decline - additional JV cashflow £6m

Exploration Fields Other Excl JV £m 13 76 12 101 Incl JV £m 8 23 31 Total £m 21 99 12 132

1999 Preliminary Results Presentation

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Intangibles £m

OIL & GAS ASSETS

NBV 1.1.99 Additions Capitalised interest Transfer to tangibles Transfer to JV’s Transfer to fixed asset investments Impairment write down Disposals Amortisation Exchange movement NBV 31.12.99 Investment in Yetagun JV company Investment in Premier & Shell Pakistan B.V. Investment in Australian Worldwide Exploration Total fixed assets 54) 9)

• )

(15)

• )

(17)

• )
• )
• )

2) 33)

Tangibles £m

414) 102) 6) 15) (111 ) (4) (14) (12) (38) 13) 371)

Total £m

468) 111) 6)

• )

(111 ) (21) (14) (12) (38) 15) 404) 40) 54) 21) 519)

1999 Preliminary Results Presentation

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Drawn at 31.12.99 £m

COMMITTED DEBT

Facilities £m

Bank credit $200m (final maturity 2002) Loan notes $280m (final maturity 2008) Convertible Capital Bond (maturity 2005) Yetagun financing $158m - $149m drawn (maturity 2008) Availability as at 31.12.99 Accrued Yetagun interest Total 124 174 28 326 93 419 7 426 124 174 28 326 98 424

1999 Preliminary Results Presentation

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BALANCE SHEET

1999 (incl. JV’s) £m

Cash Debt Net Debt Shareholders’ funds Gearing ratio 158 426 268 309 87

1999 (as reported) £m

155 326 171 309 55

1998 (as restated) £m

28 317 289 195 148 % % %

Recapitalised, debt refinancing underway and commitments covered

1999 Preliminary Results Presentation

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OPERATIONS

1999 Preliminary Results Presentation

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PRODUCTION BY COUNTRY

1998 2001 2002 2003 2004 80,000

Myanmar Pakistan Indonesia UK Other

70,000 60,000 50,000 40,000 30,000 20,000 10,000

Produtction (boepd)

Gas production growth anticipated

2000 1999 1999 Preliminary Results Presentation

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CAPEX - FIELDS/DEVELOPMENT BY REGION

1998 1999 2001 2002 2004 150 125 100 50 25

(£ million)

75

£133 million of equity completes funding of current developments Developments on schedule

2000 2003

Myanmar Pakistan Indonesia UK Other

1999 Preliminary Results Presentation

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RESERVES

1998 Produced Discovered & extension Adjustment 1999 500 400 300 100

• 100

Million boe

200

Reserves depleted at 2.3% p.a. at 1999 production levels

11 3 4 470 460

1999 Preliminary Results Presentation

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U.K. - CURRENT PRODUCTION 18,100 boepd

Scotland England Wales Eire Northern Ireland

Wareham Scott, Rob Roy, Ivanhoe, Hamish, Telford Fergus Fife Galahad, Mordred Wytch Farm Kyle Chestnut

Wytch Farm

Produced 11266 bopd Extended well M16 and M17 drilled Infill drilling planned

Fife / Flora / Fergus

Produced 3880 bopd FPSO back on location Premier interests Oil fields Gas fields Flora

Chestnut Kyle

Delays on Banff tie-in EWT start-up in 2000 Low cost development candidate

Scott

Produced 1900 bopd

U.K.

Portfolio focused on cash generating assets

1999 Preliminary Results Presentation

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PAKISTAN - CURRENT PRODUCTION 2,500 boepd

US$ revenue generating business with significant gas upside Nearing commercialisation of Bhit and Zamzama

Premier interests Gas fields Kadanwari Ghauspur Qadirpur Dadhar Bolan Kirthar Dadu KNS Dumbar Zarghun Discovery Bhit Field Badhra Discovery

Pakistan

Zamzama Discovery

Pakistan

Significant gas reserves Two gas fields on production - 2500 boepd Two recent discoveries awaiting development Existing activities are carried

• ut through a 50:50 JV with

Shell

Kadanwari

Production of 65 mmscfd in 1999 Miano tie-in extends field life

Qadripur

Increased production capacity to 300 mmscfd Agreed development scope for 500 mmscfd

Bhit and Badhra

Awaiting development Development plan agreed Field declared commercial Negotiating GSA to supply 245 mmscfd into existing pipelines in 2002

Zamzama Zarghun

Appraisal well tests 90 mmscfd Early production GSA negotiations nearing completion Discovery appraised Initial development plans envisage the export of gas to Quetta 1999 Preliminary Results Presentation

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MYANMAR

Yetagun

Well head platform installed Production platform completed and installed FSO mobilised Offshore pipeline completed Onshore pipeline completed Ready for gas nominations from 1st April Slight delays to ‘Ratchaburi’ and Wang Noi pipeline connector Thailand Myanmar

Wang Noi Rayong Surat Thani Khanom Ratchaburi

M10 M13 M12

Yadana

M14

Mergui YANGON PHUKET

Andaman Sea

BANGKOK

Gulf of Thailand

Yetagun 3,600 MW gas-fired power station under construction (750 mmcfd)

Premier interests Gas fields Proposed pipeline Existing pipeline

1999 Preliminary Results Presentation

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YETAGUN DEVELOPMENT PROGRESS

This US$650 million project, operated by Premier, has been delivered

• n schedule and on budget

Yetagun Production Facilities Development Completed

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 1997 1998 1999 2000 Feb 2000

Planned cum. 98.9% Actual cum. 98.4%

1999 Preliminary Results Presentation

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INDONESIA - CURRENT PRODUCTION 7,900 boepd

Malaysia

Kuala Lumpur

Port Dickson Kerteh

Dumai

SINGAPORE

Port Klang

Duyong

West Natuna

GSA signed Jan ‘99 Conoco operated pipeline - construction ahead

• f schedule

Anoa and Kakap

Anoa production 4200 boepd Kakap production 3700 boepd Gas wells planned for 2000 Kakap Sotong deep well dry Field life extended by gas project

1999 Preliminary Results Presentation

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WEST NATUNA GAS PROJECT

SINGAPORE Anoa Platform KF Platform Jemaja Mubur Bintan Batam

MALAYSIA INDONESIA

325 mmscfd, 22 year GSA has been executed Natuna A will export around 120 mmscfd Kakap will export around 65 mmscfd First gas scheduled for July 2001 Export pipeline ahead of schedule with over 100km of pipe installed Premier has a 28% interest in the gas contract which has anticipated gross revenues of US$8 billion

GAS LINE TRUNKLINE 1999 Preliminary Results Presentation

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NATUNA SEA BLOCK ‘A’ GAS DEVELOPMENT

Major EPIC contracts awarded - date-certain lump sum contracts

EAST LOBE WEST LOBE

Future Tie-in from other field Pipeline to Singapore New subsea well SA-20 New Floating Flare New subsea well SA-21 RISERS FPSO Export Tanker

New AGX Platform 2001 Existing Anoa Platform Existing Anoa FPSO

1999 Preliminary Results Presentation

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Expenditure reduced - high risk wells farmed out 7 exploration wells, 1 appraisal 3 dry wells 3 non commercial discoveries Successes at Badhra and Zamzama-2 Year 2000/2001 program focussed on step-out drilling from existing and planned infrastructure

1999 EXPLORATION

1999 Preliminary Results Presentation

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NEAR TERM PRIORITIES

Maximise UK production and run business for cash Complete Asian gas developments Secure second West Natuna gas sale contract Build joint gas development business in Pakistan with Shell Position for growth

1999 Preliminary Results Presentation

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THE ASIAN GAS BUSINESS

80% 60% 40% 20% 0%

South and Central America

100%

North America Europe Former Soviet Union Middle East Africa Asia Pacific

Regional Consumption Pattern 1998

20-30% 10%

Asian Energy Flux

123

Significant markets poorly connected to significant reserves Asia produces 10% of world energy and consumes 27% of world energy Gas provides less than 10% of total energy in Asia versus 20-30% in Europe and North America

Oil Natural Gas Nuclear Energy Hydroelectricity Coal

1999 Preliminary Results Presentation

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EXISTING AND POSSIBLE FUTURE ASIA PACIFIC GAS GRID

Petronas / Hess assets complement Premier’s existing portfolio and strategy

Premier Petronas / Hess Operational Construction, planned

• r proposed

Possible future pipeline routes

PAKISTAN INDIA BANGLADESH MYANMAR THAILAND CAMBODIA VIETNAM MALAYSIA INDONESIA PHILIPPINES JAPAN LOAS AUSTRALIA

Indian Ocean Pacific Ocean

1999 Preliminary Results Presentation

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Restructured and focussed

• 4 core areas
• Cashflow
• Complete major developments

PREMIER TODAY

Stronger balance sheet Inbuilt production / cashflow growth Strengthened Board and management Strategic alliance

• Shell - Premier - Petronas joint gas transport and marketing in

Pakistan

• Operating business unit synergies reviewed
• Second West Natuna gas sale to Malaysia under discussion

Current portfolio delivering

1999 Preliminary Results Presentation

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APPENDIX

1999 Preliminary Results Presentation

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1998 mboepd

NET PRODUCTION

1999 mboepd

: Wytch Farm : Scott Area : Fife Area : Galahad : Blenheim : Qadirpur : Kadanwari : Kakap : Anoa 11.3 2.3 3.8 0.7 0.1 18.2 1.6 0.9 2.5 3.7 4.2 7.9 0.5 29.1 13.6 2.8 5.1 0.7 0.1 22.3 3.0 1.9 4.9 3.8 3.4 7.2 1.1 35.5 U.K. Pakistan Indonesia Other Total

1999 Preliminary Results Presentation

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Indonesia (35.0%) Pakistan (13.6%) Myanmar (39.1%) Rest of World (3.6%) U.K. (8.7%) Yetagun (39.1%) 180mmboe (675mmboe) Qadirpur (5.3%) 24mmboe (505mmboe) Block A (30.2%) 139mmboe (208mmboe) Bhit 7.0% 33mmboe (160mmboe) Wytch Farm 5.6% 26mmboe (210mmboe) Kakap 4.7% 22mmboe (117mmboe) Other 8.1% 37mmboe

Net Reserves Gross Field Reserves

Note: working interest basis

460 mmboe 460 mmboe

BOOKED RESERVES (END 1999)

Reserves by area Reserves by field

1999 Preliminary Results Presentation

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EXPLORATION & APPRAISAL WELLS IN 1999

U.K.

Sotong-1X Mako-1 Hoeness 28/10a Tay Flynn Natuna Sea

Pakistan Indonesia Australia

Chelonia-1 Zamzama-2 Badhra-2

Gas discovery - Badhra Successful appraisal - Zamzama

1999 Preliminary Results Presentation

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INDONESIA - UJUNG PANGKAH OIL & GAS DISCOVERY

East Java Madura Island

Tuban Gresek Surabaya

Ujung Pangkah

Premier 40% and operator Field appraisal programme scheduled this year

East Java Sea Gas Pipeline

1999 Preliminary Results Presentation

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