Q2 Q2 20 2013 Presentation 14 August 2013 This presentation is - - PowerPoint PPT Presentation

Q2 Q2 20 2013

Presentation 14 August 2013

This presentation is provided for information purposes only. It should not be used or considered as an offer to sell or a solicitation of an offer to buy any securities. Any opinions expressed are subject to change without prior notice. Although all reasonable care has been taken to ensure that the information herein is not misleading, Crudecorp makes no representation

• r warranty expressed or implied as to its accuracy or completeness. Neither Crudecorp, its employees, nor any other person connected with it, accepts any liability whatsoever for

any direct or consequential loss of any kind arising out of the use or reliance on the information in this presentation. This presentation is prepared for general circulation and general information.

2

Q2 Highlights

Operations are contributing positive to EBITDA 2nd steam generator operational Production build-up Oil sale of 41,130 bbls in Q2 (26,803 in Q1) Average oil price USD 96.68/ bbl in Q2 (USD 102.46 in Q1)

Sales Operations Post 30.06

New appraisal well, well 35-452, drilled in July

3

Financial Highlights

Q2 2013 Q2 2012 % change Oil sale (bbls) 41 130 4 450 824 % Achieved Oil Price ($/bbl) 96,68 100,34

• 4 %

Revenues, MUSD 2,946 0,328 798 % COGS, MUSD

• 1,706
• 0,388

340 % OPEX (other opex and salary), MUSD

• 1,039
• 1,307
• 21 %

Other income/expenses*, MUSD 3,465 0,000 EBITDA, MUSD 3,666

• 1,367
• 368 %

Depreciation, MUSD

• 0,961
• 0,447

115 % Capital expenditure, MUSD 2,013 4,904

• 59 %

Cash position (as per 30.06), MUSD 7,338 1,043 604 % Book equity (as per 30.06), MUSD 40,381 33,491 21 % Unaudited * Provision of calculated loss compared to MTM value (market to market) on Credit Suisse facility

4

Profit & Loss

(MUSD) Q2 2013 Q2 2012 Comment Revenues 2,946 0,328 Increase in revenues due to production from additional wells. Production cost

• 1,706
• 0,388 Increased activity including a new steam generator and new wells completed for production

Salaries

• 0,577
• 0,247

Depreciation

• 0,961
• 0,447 In Q4 12 implemented a unit of production (UOP) depreciation profile

Other operating expenses

• 0,462
• 1,060 High costs in Q2 12 related to listing on Oslo Axess and 3rd party financing

Other expenses 3,465 Reduced previous loss on MTM value on Oil swap agreement Credit Suisse facility Operating profit / EBIT 2,704

• 1,814

Net financial items 0,186 2,673 Material variations due to change in USD/NOK exchange rate Taxes

• 1,382

0 Tax is calculated based on the effective tax rate for 2012. Net profit/(loss) 1,508 0,859 Unaudited

5

Balance Sheet

Assets (MUSD) 30.06.2013 30.06.2012 Comment Deferred tax assets 1,5 Deferred tax assets recorded in the Balance Sheet from Q4 12 Fixed Assets 53,3 25,8 Increase due to investments for oil production Production Rights in oil field 7,4 7,6 Other non-current assets 5,0 1,5 Third parties' share of investments (10 % owners) Note 6 in interim report Total non-current assets 67,2 35,0 Total Current Assets 12,6 2,0 Cash USD 7 mill, Receivables USD 5,1 million (incl 2.6 mill related to prepaid steam operating expenses) Total assets 79,8 37,0 Equity and Liabilities (MUSD) 30.06.2013 30.06.2012 Comment Equity 40,4 33,5 Long Term Liabilities 34,5 1,8 Credit Suisse, bond issue, derivatives and liability to previous owner Short Term Liabilities 4,9 1,7 Including USD 3.6 million related to accrued interest to Credit Suisse and Bond Issue Total equity and liabilities 79,8 37,0 Unaudited

6

Cash Flow

Cash flow from operating activities 30.06.2013 30.06.2012 Cash flow from operations

• 3,276
• 2,948

Interest paid

• 1,659
• 0,020

Taxes paid Net cash from operating activites

• 4,935
• 2,968

Cash flow from investing activities Purchase of tangible fixed assets

• 6,853
• 10,452

Loans to third parties

• 0,658
• 1,245

Net cash flow from investing activities

• 7,511
• 11,697

Cash flow from financing activities Issue of ordinary shares 11,536 Bond Issue Credit Suisse facility

• 1,400

Net cash from financing activities 10,136 Net change in cash, cash equivalents and bank ove

• 2,309
• 14,665

Cash, cash equivalents and bank overdrafts as of 1 Janu 10,876 14,757 Exchange rate gain-/loss on cash, cash equivalents and

• 1,228

0,951 Cash, cash equivalents and bank overdrafts at end 7,338 1,043 Unaudited

• Crudecorp is now developing the Etchegoin sands in

the Chico Martinez property at depth of 400 – 1000 feet

• STOIIP (2P) estimated to 53.8 MMBbls

– Competent Person’s Report by Gaffney, Cline and Associates – 0.7 MMBbls (approx 1.2%) already produced – Current planned development addresses 28% of STOIIP – More of the Etchegoin STOIIP to be developed when cash flow is established, and more knowledge has been gained from the reservoir

7

Location Reserve estimates

The Chico Martinez Oil field in California

• Location: San Joaquin Basin west of Bakersfield, California
• 2P production in 2015 is estimated at 2,390 bopd, with current

development plan (28% of STOIIP). (from GCA report)

• Intention is to develop the rest of the field (100% of STOIIP), thereby

lifting production rates and extending field life

• Current 10 years, but potential for 25-30 year field life
• Operating cost USD 20 - 25 per bbl (in 2014)
• Effective NRI is 78.35% to Crudecorp (net after royalty)

Key facts

San Joaquin Basin west

• f Bakersfield, California
• 5 independent engineering studies (1988-2008)

estimate oil in place in the Etchegoin formation between 55 and 63.5 MMBbls, with potential recovery of 32 -67%

• 3D seismic shows potential for new discoveries in existing

property, hereunder deeper Etchegoin, Monterey and Carneros

*1P:Probable, 2P: Probable+Proven, 3P: Probable+Proven+Possible

Chico Martinez Oil field (gross reserves)* Gross Field Oil Reserves (MMBbls) 3.51 5.15 5.60 1P 2P 3P

8

Initial development through Cyclic Steam Circulation The “Huff and puff” method

Initial development through “Huff and Puff” Permanent steam flood to reservoir to be established Phase 2a

Dummy picture

Phase 2b-4

Steam flooding

Cyclic steam injection Steam is injected into a production well. Heats up adjacent oil to well bore and produce water and oil back. Continuous steam injection Steam is injected into a dedicated injection

• well. Heats up the entire reservoir and
• il flows to production well.

9

Q1 activity

Phase 1 - 4 Phase 6-7

• Steam flood
• 4 horiz. prod. wells
• 48 vert prod. wells
• 29 steam injt. wells

Operational Operational Q4-2013

• 44 production wells and 27 steam injection wells hooked up and operational
• The Company is close to implementing a pilot expansion in the area surrounding well 463
• Process for Right of Way for water pipeline ongoing (lower operating costs)
• Planning for oil export pipeline
• Optimization of operations
• Steam flood

expansion

• 60 – 72 prod. wells
• 48 injection wells

2015-2016

A 7-phased development plan is currently in place Growth through investments in extra production wells Phase 5B

• Steam flood expansion
• Area close to well 463

and 452

• 6-18 vert prod. wells
• 2 - 10 steam injt. wells

Possible Q2 2014

Phase 5A

• Steam flood pilot
• Area close to well 463
• 5 (+1) vert prod. wells
• 2 steam injt. wells

Production Q2 (incl. July)

• Steam injection ramp up in May, coinciding with higher steam injection pressure
• Approximately 55% of wells are under continuous steam influence by end of June
• Production is progressing as planned, with some delays of operational nature in Q1 following

through to Q2.

• Post 30.06.13: Slightly lower steam volumes due to change over to larger pumps on wells

and drilling operations

Results from Well 463

Encountered 3 Etchegoin reservoir sands Younger Etchegoin deposit The well log corresponds well with an anomalous amplitude on the seismic dataset The 463 well has now been production tested for 2 months, and the test indicate a SOR = 1.5 to 2.0 for first cycle (versus SOR = 6-8 for current development)

Primary objective Verify if the geological structure in well 463 was repeated in the second fault Block to the North, as suggested by a coherent seismic amplitude zone which matched the well log in 463. Result: Found a repeat geological structure of 463. The 452 well has not been production tested, but looks very promising for development. Secondary objective Verify if there are hydrocarbons in a deeper Etchegoin structure, which on-laps the down dip Etchegoin structure, currently being produced from. Result: Found an 8 ft oil sand. The result strengthens the assumption of a basal Etchegoin sand in the area.

Well 452 objectives (drilled July 2013)

Well 452 objectives (2)

New development area

NEW AREA FOR DEVELOPMENT

452 block 463 block

PHASE 5A

Drill 5 production wells + 2 injectors in the 463 block in Q3 2013; Prove the area and business model for a larger development in the area Increase short term production

PHASE 5B

Drill up to 28 production wells in 463 and 452 block in Q2/Q3-2014; Phase 5B may be split into two seperate projects

Proposed development plan

(Northeast Shallow Etchegoin)

Planned exploratory drilling in Q4 2013

• There are several potential

exploration targets, between 6,000 and 14,000 ft depth

• The Company has applied for

drilling permits

• In the drilling permit, the Company

has undertaken to conduct certain environmental surveys; which are on-going

Summary of potential

Etchegoin Phase 1-4 (Current Development) Etchegoin Phase 6-7 (Extension of Current Development) Etchegoin Phase 5A and 5B (NE Shallow Etchegoin) Monterey Deep prospects Carneros/ Point of Rocks etc. NE Deep Etchegoin Developed (proven) Planned developed (not all proven) Probable and possible developed Exploration potential

• Phase 1-4 production target of 2,390 bopd.
• New development area with better reservoir quality. Potential to lift production

rates with new development phases 5A and 5B (in Northeast Shallow Etchegoin)

• Prove up more of the Etchegoin structure for development Phase 6 & 7

18

Summary

Production increase

1

• All production wells and steam injection wells for Phase 1-4 are hooked up
• Second steam generator operational
• Production build-up. Expected to continue till 2015 when peak is reached

Long term potential

2

Future opportunities

3

• Significant potential for exploration opportunities in existing property, including;
• lead for Northeast Deeper Etchegoin onlap play
• potential for a significant discoveries in Monterey and Carneros.
• Potential for structural activities, including M&A opportunities