CORPORATE PRESENTATION 2 SNAPSHOT BACKGROUND STRATEGY A - - PowerPoint PPT Presentation

CORPORATE PRESENTATION

2013 AGM

November 2013 CORPORATE PRESENTATION 2

SNAPSHOT

 Continue to deliver revenue from

existing discoveries

 Cash flow to support business

development activity

 Identify advanced pre-

development or producing assets, primarily in Former Soviet Union

 Participation in the Myanmar

• ffshore bid round.

 Further assessment of owned assets

• Potential partnerships
• Farm out activity

BACKGROUND STRATEGY  A profitable E&P business, focused

• n the exploitation of

underdeveloped discoveries in the prolific Dnieper-Donets basin in Ukraine

 Sales from Gas and Condensate in

FY2013 totalled AU$14.2m

 100% owned gas plant – increased

revenue and earnings security

 AU$2.3m cash balance at end

FY2013 – no debt

 Incentivised, focussed, experienced

management team – local knowledge

November 2013 CORPORATE PRESENTATION 3

 Highly experienced management team with a strong profile in Ukraine

MANAGEMENT

EXECUTIVE CHAIRMAN Glenn Featherby

• Highly experienced in

corporate advisory

• Chartered accountant
• Chairman of dual listed

Forte Energy CEO & MD Richard Reavley

• Experienced manager
• f European oil and gas

assets

• Former Director of

Goldbelt Resources Ltd CFO Victor Eriksen

• 19 years FSU

experience

• Fluent Russian Speaker

PRESIDENT UKRAINIAN SUBSIDIARY - PRIMEGAS LLC Viktor Dmitriyev

• Engineer with 30 years

experience in the Ukraine

• Co-founder

NON-EXECUTIVE DIRECTOR Bill Foster

• More than 40 years’

experience

• Senior advisor to

Marubeni Corp

• Petroleum Engineer

NON-EXECUTIVE DIRECTOR Lord Risby

• 20 years’ financial

services experience

• Chairman of British

Ukrainian Society

• Extensive FSU

experience NON-EXECUTIVE DIRECTOR Graham Lyon

• 30 years’ international
• il & gas experience
• Extensive FSU

experience

• Petroleum Engineer

November 2013 CORPORATE PRESENTATION 4

UKRAINE

Premier European Postcode

Significant growth potential

 Undeveloped discoveries

• est. 39 Tcf gas & 395 mmbl oil resources*

 Favourable commercial terms  Strong product pricing

• $11.16 gross / mcf ($9.30 net)

 Hawkley’s local advantage

• Focused team with strong network
• Highly experienced – proven ability
• Incentivised
• Wholly owned gas plant

Sector Snapshot

 Dynamics in the European gas market  Improving operating environment for foreign companies  Growing availability of modern rigs  A real need to increase domestic production

• More modern operational techniques
• Equipment importation process simplified
• Recent entry of majors – Shell, Exxon, Chevron

DEMAND SUPPLY

* Source: Edison Investment Research

November 2013 CORPORATE PRESENTATION 5

ASSET OVERVIEW

Sorochynska  Well 201 produced 1.35 Bcf gas and 33,870 Bbls condensate in FY2013  20 year production licence awarded April 2012  Wholly-owned gas plant acquired, refurbished and commissioned with 99.8% uptime Next Step:  Installation of gas compressor to maximise recovery from the field Stoliarovska  Acquired in March 2013 with 20 year production licence  Total unrisked prospective recoverable resource of 193 Bcf Next Step:  Re-process existing 2D data & acquire further seismic data to identify optimal well locations – expected Q2 FY2014 Chernetska  Exploration licence with significant upside  5 year licence extension for exploration and pilot production Next Step:  Evaluation of data obtained in Chernetska-1 well

Diverse portfolio of production, appraisal & exploration opportunities Substantial advanced exploration upside in all licences Operator and 100% owner of two production licences (Sorochynska & Stoliarovska) and an exploration licence (Chernetska) in Ukraine’s premier gas basin

DEVELOPMENTS IN FY13

November 2013 CORPORATE PRESENTATION 6 Operational

 Acquisition and upgrades of Eurocrimea gas plant for $2.5 million

• 99.8% uptime in June quarter

 Acquisition of 20 year production license, Stoliarovska

• Ukrainian State Geological Department estimates prospective resources of (Russian category C3)

89.7Bcf Gas and 29.2million barrels of oil in Visean sandstones, further potential in the Serpuchovian

 Production from Sorochynska-201 totalling 1.35 Bcf gas and 33,870 Bbls condensate

• Average daily production of 3.7 mmscf gas and 94 Bbls of condensate

 Testing of Sorochynska-202

• Determined to be uneconomic – plugged and abandoned after FY13 close

 Five-year exploration extension at Chernetska  Identification of potential M&A targets

• Focus on mature pre-development or producing assets

Financial

 Pre-tax gross profit of $7,150,000

Corporate

 Appointment of Lord Richard Risby to the Board

• Extensive experience in financial markets with institutions including Merrill Lynch and Lehman Brothers
• Chairman of the British Ukrainian Society

 Appointment of Graham Lyon to the Board

• 30 years of experience in the oil and gas industry, including time with supermajors Chevron and Shell

November 2013 CORPORATE PRESENTATION 7

SOROCHYNSKA: OVERVIEW

 Drilled successful #201 in 2010  #201 put into production in Feb 2011  Produced total of 4.76 Bcf and

153,570 Bbls condensate

 20 year production licence awarded

in 2012

 March 2013 completed acquisition &

commissioning of wholly owned gas plant

 Gas plant achieved 99.8% uptime in

Q4

 Planned installation of gas

compressor to increase recovery from field

B19 appraisal - development B18 U B18 L B19 L B22

SOROCHYNSKA GAS PLANT

Major Milestone – Significant Cost Savings – Rapid Payback

November 2013 CORPORATE PRESENTATION 8



Wholly owned by Hawkley – commissioned in March 2013



Total cost US$2.25m – payback expected in 11 months



Delivery of cost savings of US$9.10 per boe



Favourable logistics – 8km from Sorochynska and 1km from trunk line



Currently handles all production from Sorochynska #201 following “ramp-up” period



Current capacity of 11 mmscfgpd



Scalable model with estimated upper limit of capacity at 90 mmscfgpd



Significant milestone demonstrating long term confidence in Sorochynska Licence

SOROCHYNSKA GAS PLANT

STOLIAROVSKA LICENCE

Diversifying Asset Portfolio

November 2013 CORPORATE PRESENTATION 9



Acquired 100% for $2.6m – completed in March 2013



Operated with full title



20 year production licence



On trend with major producing fields & deposits



Excellent infrastructure, trunk line close by & gas plant ~4km from the licence



Relatively shallow targets - significantly reduces drilling costs and times



Area covered by 2003 vintage grid

• f 2D seismic data



Hawkley intends to reprocess and acquire additional seismic to identify optimal well locations

STOLIAROVSKA LICENCE

Production Licence with Significant Upside Potential

November 2013 CORPORATE PRESENTATION 10



Total unrisked prospective recoverable resource of 193 Bcf gas



Ukrainian State Geological Department estimates prospective resources of (Russian category C3) 89.7 Bcf gas and 10.4 million barrels

• f oil in Visean sandstones



Three possible plays identified in Carboniferous sands

1.

Stratigraphic channel play (Serpukhovian age)

2.

Fault closures on downthrown side of normal faults

3.

Fault closure – below reverse faults



Additional prospect identified in the Serpukhovian has the potential to contain 42 Bcf gas

November 2013 CORPORATE PRESENTATION 11

CHERNETSKA UPSIDE: B24/25 CARBONATES



1st well on Chernetska Licence (Well #1) completed in May 2012



Inconclusive test results – further testing with workover rig possible



B20 sandstone target encountered two thin sandstones with oil shows



Gas shows from B24/25 &

• il recovered from B26

Multiple Hydrocarbon Bearing Horizons

Lak-2 flowed at 2 MMCF/d Lak-7 flowed at 1.5 MMCF/d

GROWTH STRATEGY

November 2013 CORPORATE PRESENTATION 12



Hawkley Board and Management have extensive experience in asset identification and corporate transactions



Strategy to add low-cost production and operating efficiencies to portfolio



Immediate focus on growth

• pportunities in Ukraine and

Former Soviet Union



Several high priority targets identified and under assessment



Aim to partner with large well- funded investors at project level with debt arrangement.

• 2. FSU EXPANSION
• Strategic Russian partner top 3

investment bank - assets, equity, debt finance

• Acquire pre-development and/or

production assets in Russia

• Development capital injection

(equity/debt)

RUSSIA

• 1. LOCAL GROWTH
• Leverage recent technical

appointments to increase efficiency

• f operations in Ukraine
• Continue to pursue production

growth opportunities across asset base

• 4. ACQUISITION / EVALUATION
• Ongoing evaluation of potential

acquisitions, with a view to adding low cost production and boosting operating efficiencies

• Reprocessing of 2D seismic data

following Stoliarovska licence acquisition

• Commence operations in Russia
• 3. DRILLING & OPERATIONS

ACTIVITES

UKRAINE



Opportunities further afield also under consideration

• Participation in Myanmar 2013 Offshore bid round
• Partnership with Azimuth Ltd, experienced offshore explorer

November 2013 CORPORATE PRESENTATION 13

SUMMARY



Production of 3.7 mmscf/d (+ 93 Bbl condensate)



Wholly owned gas plant delivered significant cost savings



Cash flow supporting business development activity

• Production & near term production in

FSU

• Myanmar offshore with strong partner



Significant upside remains within Ukraine assets

• Farm out / partnership potential



Strong management with local knowledge and reputation

SUBSTANTIAL UPSIDE STRONG MANAGEMENT STABLE REVENUE PROFITABLE

APPENDICES

14

15

DISCLAIMER

 This presentation contains certain “forward-looking statements.” All statements, other than statements of historical fact, that address activities, events or developments that Hawkley Oil and Gas Ltd believes, expects or anticipates will or may occur in the future are forward-looking statements.  Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “believe”, “plan”, “estimate”, “expect”, and “intend” and statements that an event or result “may”, “will”, “can”, “should”, “could”, or “might” occur or be achieved and other similar expressions.  These forward-looking statements reflect the current internal projections, expectations or beliefs of Hawkley Oil and Gas Ltd based on information currently available to Hawkley Oil and Gas Ltd.  Forward-looking statements are subject to a number of risks and uncertainties, including those detailed from time to time in filings made by Hawkley Oil and Gas Ltd with securities regulatory authorities, that may cause the actual results of Hawkley Oil and Gas Ltd to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on Hawkley Oil and Gas Ltd.  Hawkley Oil and Gas Ltd expressly disclaims any obligation to update or revise any such forward-looking statements.  Not for distribution to United States newswire services and not for dissemination in the United States.  The forecast revenue and production estimates provided in this presentation are based on the company achieving success with its production plans in the next 3 years. The revenue and production estimates are conceptual in nature and until final drilling and testing has been completed, there is insufficient exploration to define gas reserves and it is uncertain if further exploration will result in the determination of a gas reserve.  COMPETENT PERSONS STATEMENT The prospective resource estimates for the Stoliarovska area are based on information compiled by Nigel

• Hanwell. Mr Hanwell is a consultant petroleum geologist with 27 years of relevant experience and is qualified in

accordance with ASX Listing Rule 5.11. Mr Hanwell is the Principal Consultant with Dixhan Solutions Pty Ltd and has consented to the inclusion of the information in the form and context in which it appears. The estimates of Prospective Resources included in this presentation have been prepared in accordance with the definitions and guidelines set forth in the 2007 Petroleum Resources Management System (PRMS) approved by the Society of Petroleum Engineers (SPE).

CONTACT INFORMATION

AUSTRALIA

Suite 3 / Level 3, 1292 Hay Street West Perth WA 6005 Australia Tel: +61 8 9226 3211 Fax: +61 8 9322 4073 Email: information@hawkleyoilandgas.com

UKRAINE

Boulevard Tarassa Shevchenka 35 Kyiv 010302 Ukraine Tel: +38 04 4569 7418 Fax: +38 04 4569 7416 Email: office@primegas.com.ua

www.hawkleyoilandgas.com UK

38 Jermyn Street London SW1Y 6DN UK Tel: +44 203 384 0880

PUBLIC RELATIONS

Six Degrees Contact: Fergus Ross Tel: +61 2 9230 0661 Email: fergus.ross@sdir.com.au