Building a mid-cap Mediterranean gas company Regional gas strategy - - PowerPoint PPT Presentation

Investor Presentation – Q3 2015

SLIDE 1

Investor Presentation

Q3 2015

Investor Presentation – Q3 2015

SLIDE 2

Regional gas strategy

• Strong European gas fundamentals
• Building political momentum across the region to stimulate

domestic demand

Balanced portfolio focused on game changing drills

• Tendrara appraisal wells Q4 2015 & Q2 2016
• Badile exploration well Q1 2016
• Laura appraisal well

Strong funding position

• EUR 26M cash balance (excluding open ofger)
• Supportive cornerstone investor with strong relationships across

the Mediterranean

• First gas at Nervesa (2015) secures signifjcant annual cash fmows
• Strong liquidity
• EUR 17M deferred and contingent consideration (Indonesia)

Building a mid-cap Mediterranean gas company

Morocco Italy

Producing / Development Assets Low risk discoveries High upside exploration

Map: key assets

Investor Presentation – Q3 2015

SLIDE 3

The team

London: Growth, funding, investor relations and compliance

5 people: 1 exec / 4 stafg James Parsons, Chief Executive Offjcer

• 23 years in Oil/Gas across Europe, South America and Central America
• 12 years with Royal Dutch Shell
• Specialising in restructuring, funding and growing small listed upstream companies
• Strong background in upstream strategy, M&A and fjnance; qualifjed accountant

Milan/Rabat: Subsurface, operations and permitting

21 people: 2 exec / 13 stafg / 6 contractors Luca Madeddu, Managing Director, Morocco

• 25 years upstream experience across Europe, Asia and South America
• Reservoir geologist with extensive experience in production operations,

fjeld development, petroleum/reservoir engineering and supply chain management

• Expertise in management of complex reservoirs

Leonardo Spicci, Managing Director, Italy

• 25 years upstream experience in Europe, Kazakhstan and North Africa
• Reservoir geologist with extensive experience in production operations

and petroleum/reservoir engineering

• Former ENI Managing Director for Northern Italy portfolio
• Able to navigate Italian approval processes

Investor Presentation – Q3 2015

SLIDE 4 Dora/Dalla High Upside Exploration

NPV 10 EUR 711M (Italy), plus multiple Tcf (Morocco)

Badile Zibido Tendrara Appraisal (CPR underway) SMG Laura Nervesa* Rapagnano Cost Covering Production Tendrara Exploration (CPR underway)

Risk

Reward

Low Risk Existing Discoveries

NPV 10 EUR 162M (Italy), plus Tendrara TBC (Morocco)

Balanced portfolio

NPV10, Mid-case / Best Estimate

Source: CPR

Key Assets

3 Rapagnano 8 * Nervesa 40 Laura 56 SMG Dora/Dalla 66 Tendrara Appraisal (Illustrative) TBC Zibido 225 Badile 486 Tendrara Exploration (Illustrative) TBC Portfolio total EUR M 500 1,000 1,500 2,000 2,500

* Excludes Nervesa II side track (under evaluation)

Investor Presentation – Q3 2015

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Key development assets: “building material cash fmows”

NERVESA GAS DISCOVERY, OWNED 100% RAPAGNANO GAS DISCOVERY, OWNED 100%

• Veneto region
• Play type: anticline structure, multiple gas

bearing Miocene sand intervals (TD 1,500-1,800m)

• 1st well drilled July 2013; expected to fmow

1.8 MMscf/d ; fjrst gas 2015

• Side-track on second well under evaluation
• Marche region (Central Italy)
• First gas achieved 15 May 2013

from the Sabbie reservoir

• 12 years production remaining

Recoverable resource 1.3 Bscf 1P €2.9M 2P +€0.5M 3P +€0.4M 2P +0.3 3P +0.2 1P 0.8

Up to €4M NPV 10

(Best Estimate €3M)

NPV10 (Eurocent 31/cbm) Recoverable resource (bscf) Recoverable resource 8.5 Bscf 2P 3.0 2P €8M 3P +5.5 3P +€16M

Up to EUR 24M NPV 10*

(Best Estimate EUR 8M)

* Excludes Nervesa II side track (under evaluation)

Investor Presentation – Q3 2015

SLIDE 6

Drilling existing discoveries (1 of 2)

LAURA, OWNED 100%

• Gulf of Taranto (4km ofgshore, 200m water depth)
• Play type: inverted fault block, gas in Pleistocene

(MVD 1,300m)

• Long reach deviated well from onshore
• €16.2M well cost

Recoverable resource 25.6 Bscf 1C 12.3 1C €27M 3C +€24M

Prospective

€6M 2C +€7M

Prospective

4.2 3C +7.2 2C +1.9

Up to €65M NPV 10

(Best Estimate €40M) NPV10 (Eurocent 31/cbm) Recoverable resource (bscf)

TENDRARA I & II, OWNED 55%

• First well Q4 2015 (£6M) to prove up to 200-300 Bscf

recoverable resource

• Key play type: Gas discovery with condensate-light oil

shows in the Lower Triassic sequence (TD 2,600m); TAGI sand objective

• Previous wells sub-optimally perforated
• CPR to be commissioned

Mediterranean

Oued El Makhazine Al Wahda Tahaddart Power plant Dhar Doum 4 x 400 MW SAMIR

Oujda Rabat Casablanca Marrakech Gas Maghreb-Europe Pipeline Gas pipeline project in

Algeria Morocco

Existing discovery II Existing discovery I

Atlantic

Investor Presentation – Q3 2015

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Drilling existing discoveries (2 of 2)

DORA/DALLA, OWNED 100%

• Adriatic Sea (21km ofgshore)
• Play type: faulted anticline, Gas-condensate

in Scaglia Formation (TD 1,400m)

• Dora gas discovery previously drilled 1972,

tested 20MMScf/d

• €13M well cost

Potential >€81M NPV 10

(Best Estimate €66M)

Recoverable resource 74.5 Bscf 2C 17.6 2C €19M 3C +6.4 3C +€15M Low 8.9 Best +15.7 High +25.9 Best €47M High tbc Low tbc NPV10 (Eurocent 31/cbm) Recoverable resource (bscf)

Up to €105M NPV 10

(Best Estimate €56M, at Eurocent 31/cbm)

Recoverable resource 67.7 Bscf Best +€36M Low €8M High +€61M High +34.4 Best +23.7 Low 9.7

SANTA MARIA GORETTI, OWNED 100%

• Marche Region (Central Italy)
• Play type: inverted fault block, gas in Pleistocene

(TD 3,800m)

• Southern
• f two producing gas fjelds

NPV10 (Eurocent 28/cbm) Recoverable resource (bscf)

Investor Presentation – Q3 2015

SLIDE 8

Exploration assets: Italy

• Po Valley (Northern Italy)
• Play type: Inverted fault block;

Gas-condensate in Mesozoic (TD 4,200m)

• 45km South West of analogous

“Malossa” gas fjeld

• EIA recently approved
• €22.6M (dry hole case)

ZIBIDO, OWNED 100%

• Po Valley; Zibido is adjacent to Badile prospect
• Play type: Downthrown fault terrace

Gas/oil in Mesozoic (TD 5,600m)

• Zibido P50 NPV10 €225M (Eurocent 31/cbm)

Up to €1,745M NPV 10

(Best Estimate €486M)

Recoverable resource 673 Bscf Low 46 High +€1,259M Best +€385M Best +132 High +495 Low €101M NPV10 (Eurocent 31/cbm) Recoverable resource (bscf)

BADILE, OWNED 100%

Lacchiarella 2 previously Badile drill

Investor Presentation – Q3 2015

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Exploration assets: Morocco

TENDRARA, OWNED 55%

• Continuity of the Algerian Triassic Province and Saharan Hercynian platform
• Eight blocks, 14,500km2 acreage, seven wells drilled, fjve of which were gas bearing,

two tested gas

• Multiple Tcf potential across multiple prospects / leads
• CPR to be commissioned

Mediterranean

GME

Oued El Makhazine 2 x 400 MW Al Wahda 2 x 400 MW Tahaddart Power plant 2 x 400 Dhar Doum 4 x 400 MW SAMIR Raffjnery

Oujda Rabat Casablanca Marrakech Gas Maghreb-Europe Pipeline (GME) Gas pipeline project in 2018

Tendrara

Algeria Morocco

Existing discovery II Existing discovery I

Atlantic

Investor Presentation – Q3 2015

SLIDE 10

Building a mid cap Mediterranean gas company

Summary

• Balanced portfolio including

production

• Existing discoveries equivalent

to 25 pence per share (mid- case)

• Multiple game changing

exploration wells across Italy and Morocco

• Euro 26M cash balance
• Organic and inorganic growth
• pportunities

News fmow

• Nervesa concession award

and fjrst gas (2015)

• Laura fjnancing / farm-in
• Badile permitting and

farm-in (2015)

• Tendrara fjrst appraisal

well (Q4 2015)

• Q1 2016 Badile exploration

well (NPV €486M)

• Producing the Laura fjeld

(NPV €40M)

European gas fundamentals

• Pricing sheltered from oil price decline
• Price upside from deteriorating

European / Russian relationship

• Strong regional infrastructure

Carbon consciousness

• Gas as bridge to low carbon future
• Oil Majors shifting to gas

(Shell / BG merger)

Growth opportunities

• Vendor price expectations falling
• Cash constrained peers, resulting

in opportunistic M&A and limited competition for assets

Regional geopolitics

• Building political momentum to

stimulate domestic production

• Pro-gas permitting process in Italy
• Competitive fjscal terms

Mediterranean Gas Strategy

Strong thematic positioning

Investor Presentation – Q3 2015

SLIDE 11

For more information please contact

James Parsons, Chief Executive Offjcer

j.parsons@soundoil.co.uk Detailed information on our investor website www.soundoil.co.uk

Disclaimer: The investment mentjoned in this document may not be suitable for all recipients or be appropriate for their personal circumstances. The informatjon in this document is believed to be correct but cannot be guaranteed. Opinions constjtute our judgment as of this date and are subject to change without warning. This document is not intended as an ofger or solicitatjon to buy or sell securitjes. Past performance is not necessarily indicatjve of future performance and the value of investments may fall as well as rise and the income from them may fmuctuate and is not guaranteed. Investors may not recover the amount invested. Some securitjes carry a higher degree of risk than others. The levels and basis of taxatjon can change. The contents of this document have been prepared by, are the sole responsibility of, and have been issued by the Company.

Investor Presentation – Q3 2015

SLIDE 12

Strong regional infrastructure

Italian high pressure gas pipeline network Moroccan gas pipeline network

High pressure gas pipeline network Milan Venice Rome

Mediterranean

GME

Oued El Makhazine 2 x 400 MW Al Wahda 2 x 400 MW Tahaddart Power plant 2 x 400 Dhar Doum 4 x 400 MW SAMIR Raffjnery

Oujda Rabat Casablanca Marrakech Gas Maghreb-Europe Pipeline (GME) Gas pipeline project in 2018

Tendrara

Algeria Morocco

Existing discovery II Existing discovery I

Atlantic