21 st September 2006 2006 Interim Results Presentation
Forward looking statements This presentation may contain forward-looking statements and information that both represents management's current expectations or beliefs concerning future events and are subject to known and unknown risks and uncertainties. A number of factors could cause actual results, performance or events to differ materially from those expressed or implied by these forward-looking statements. Page 3 | 2006 Interim Results Presentation
Interim Results Presentation Highlights Simon Lockett Financial Results Tony Durrant Exploration & Appraisal Robin Allan Production & Development Neil Hawkings Page 4 | 2006 Interim Results Presentation
Highlights Page 5 | 2006 Interim Results Presentation
Operational highlights Production Profile Production Profile by Region (boepd) (boepd) 80000 80000 Asia Production up on 2005 full year average Potential new projects M/East & Pakistan 70000 70000 Booked reserves West Africa • Production of 33,521 North Sea 60000 60000 (33,235 boepd), tangible progress 50000 50000 40000 40000 boepd 30000 30000 towards 50,000 boepd target 20000 20000 10000 10000 0 0 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 • Significant progress Zamzama, Bhit, Badhra, Kadanwari, on new gas sales in Zarghun, Qadirpur, North Sumatra Pakistan & Indonesia Block A, Natuna Sea Block A • Operated drilling 2006 successes on Dua, Lembu success in Indonesia Peteng, Macan Tutul, Lukah, and & Vietnam West Lobe, with more wells to follow • Acquisition in North 110 bcf net undeveloped certified Sumatra with reserves, with a ready gas buyer. significant upside Significant potential upside Page 6 | 2006 Interim Results Presentation
Financial highlights 64% • Profit after tax - up Rising oil and gas prices, 64% to $33.7m stable production 1H 2005 1H 2006 218% • Healthy cashflow – up Disciplined approach to 218% to $172.3m expenditure 1H 2005 1H 2006 +43.8m Half year net cash position of • Improved balance $43.8m vs. year end net debt sheet position of $26.2m -26.2m End 2005 1H 2006 $50m exploration Significant cash inflow in • Expenditures on track $100m development January 2006 Page 7 | 2006 Interim Results Presentation
Asia Middle East/Pakistan Asia Middle East / Pakistan Building on our Enhancing the Pakistan Natuna Sea position gas business • Lembu trend appraisal • Continuing production and Anoa oil finds growth • Dua & Swan • New gas contracts development studies and field expansion • Blackbird exploration • New business focus in well results in Q4 the region • North Sumatra Development Planning • Gas sales and Ratna negotiations ongoing Page 8 | 2006 Interim Results Presentation
North Sea West Africa North Sea Returning to growth • Frøy development plan on track • Applications in UK and Norway licensing rounds • UK Peveril well in 4 th Quarter West Africa Building a new core Business • Seeking to optimise Chinguetti development • Tiof development studies • High impact exploration in Guinea Bissau and Congo Page 9 | 2006 Interim Results Presentation
Financial Results Page 10 | 2006 Interim Results Presentation
Production and Income Statement 6 months to 12 months to 6 months to 30 June 2006 31 Dec 2005 30 June 2005 Highlights 33.5 Working Interest Production (mboepd) 33.3 34.8 Oil and gas split steady at around 30/70 31.0 Entitlement Interest Production (mboepd) 28.7 30.2 66.5 Realised oil price ($/bbl) 48.4 38.1 Average 1% premium to Brent crude 5.3 Realised gas price ($/mcf) 3.8 3.4 Strong gas prices in Singapore $m $m 219.6 Sales and other operating revenues 149.3 Underlying operating costs per barrel (85.5) Cost of sales (73.7) flat at $5.2/bbl (15.8) Exploration/New Business (5.7) Includes $9.2m of exploration write-off principally in Egypt (8.2) General and administration costs (9.1) 110.1 Operating profit 60.8 (18.6) Financial Items 1.2 Includes $15.9m of mark-to-market hedging adjustments 91.5 62.0 Profit before taxation (57.8) Taxation (41.5) Effective tax rate of 43% of gross profit 33.7 Profit after tax 20.5 Prepared in accordance with IFRS Page 11 | 2006 Interim Results Presentation
Cashflow 6 months to 6 months to 30 June 2006 30 June 2005 $m $m 223.6 Net cash flow from operations 93.9 (1.3) Net interest (0.1) (50.0) Taxation (39.6) 172.3 Operating cash flow 54.2 2006 2005 (95.9) Capital expenditure (62.0) Exploration 39.9 28.0 Development 39.0 34.0 (6.6) Pre licence exploration costs (-) Acquisitions 17.0 - 69.8 Net cash flow before financing (7.8) 95.9 62.0 Page 12 | 2006 Interim Results Presentation
Balance Sheet As at As at 30 June 2006 31 December 2005 $m $m Intangibles 111.6 63.9 Vietnam farm-out will complete after Blackbird well Producing and Development Assets 570.1 568.9 Net cash resources of $43.8 million at period end Cash and Equivalents 43.8 38.5 Favourable movement in working capital due Net Working Capital (54.8) 5.5 to cargo delivery schedule Long-Term Debt - (63.6) Unused facility of $275 million Provisions (258.3) (250.5) Net Assets 412.4 376.1 Page 13 | 2006 Interim Results Presentation
Commodity pricing compared with hedges 2003-2012 Dated Brent Oil HSFO Singapore 180 ($/bbl) ($/metric tonne) 100.00 500.00 90.00 450.00 80.00 400.00 70.00 350.00 60.00 300.00 50.00 250.00 40.00 200.00 30.00 20.00 150.00 03 04 05 06 07 08 09 10 11 12 03 04 05 06 07 08 09 10 11 12 Year Year Commodity Price Average Cap and Forward Curve Average Floor Page 14 | 2006 Interim Results Presentation
Financial strategy • Disciplined exploration spend of $50 million on a pre-tax basis – under review for 2007 in light of E&A success • Strong balance sheet and unused funding available for development capital and acquisitions • Fully capturing current oil and gas pricing • Buyback programme available according to market conditions Page 15 | 2006 Interim Results Presentation
Exploration Highlights Page 16 | 2006 Interim Results Presentation
Vietnam Blocks 12E & W Swan Operator – Premier • Dua (spudded 1 st May 2006) Quit Canary Dua • Blackbird Peacock Blackbird • Swan commericalisation Falcon opportunities for 2007 • Falcon, Peacock and Quit: follow-on prospects 12E-CS-1X Blackbird Structure Dua Structure Page 17 | 2006 Interim Results Presentation
Vietnam - Dua Premier Premier Dua-5X Dua-4X Dua-1X Dua-1X Discovery Dua-2X 12-A-1X 5km Page 18 | 2006 Interim Results Presentation
Vietnam – new Dua Additional oil and gas discoveries in shallower reservoirs Premier Premier Dua-4X & -4Xst Dua-5X • Dua-4x and -4xst intersected gas- bearing reservoirs NCS sandstones • Dua-5x intersected gas and oil-bearing reservoirs NCS carbonates Page 19 | 2006 Interim Results Presentation
Indonesia drilling update – Natuna A PSC Natuna Sea Block A PSC • 2006 Success in: • Macan Tutul-1 • Lembu Petang-1 • Lukah-1 Lembu Peteng-1 • Planned Ibu Lembu follow-up drilling Q4 Lukah-1 2006 Macan Tutul-1 Page 20 | 2006 Interim Results Presentation
Lembu Peteng follow-up potential • A new oil and gas trend within tie-back Ibu Lembu distance to existing infrastructure Lembu-1 Peteng-1 Lembu Peteng Page 21 | 2006 Interim Results Presentation
Exploration – the next 12 months 2006 2007 West Africa SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP Guinea Bissau: Eirozes-1 Espinafre-1 Mauritania : Kibaro-1 Gabon : Themis-1 M/East & Pakistan Pakistan : Anne-1 Asia Indonesia : Ibu Lembu-1 : 3-4 further wells (commencing September) : Kakap Vietnam : Blackbird-1 : Dua-5x India : Masimpur-3 : Hailakandi-1 : Kanchanpur-1 North Sea UK : Peveril Appraisal wells Contingent Wells Exploration wells High impact wells Page 22 | 2006 Interim Results Presentation
Vietnam – opportunity set Quit Risky but big potential Swan Possible well to test gas volumes in SW of closure Dua Field Further appraisal Flamingo Major high, 3D repro Chim Dau being interpreted Near field exploration to Dua Jay Near field exploration to Dua Blackbird In success case, 3D April 2007, appraisal well April 2008 Falcon & Others On trend, follow-up to Blackbird Page 23 | 2006 Interim Results Presentation
Vietnam - Blackbird Blackbird Prospect – estimated 80 million barrels reserves potential 12E-LX-1X Existing Well 12E-LX-1X Premier 12E-CS-1X Thick sands with residual oil; Drilled outside structure Planned at crest drilled close to mapped contact Anticipated Oil Water Contact at spill-point Page 24 | 2006 Interim Results Presentation
Indonesia drilling programme - 2007 Natuna Sea Block A PSC • 3-4 wells are planned for 2007. Contenders are shown Tupai Lembu Peteng-2 Ibu Lembu Kakap Lembu Tenggiling Ganesha Page 25 | 2006 Interim Results Presentation
India high-impact wells Cachar Block • 2 Tcf gas prospect • Masimpur-1 mobilising for December 2006 spud • Hailakandi-1 & Kanchanpur-1 follow-up wells, each with high potential Masimpur Anticline NW SE Seismic line POC-03-12 Primary Target: Oligocene Renji Formation Page 26 | 2006 Interim Results Presentation
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