Q3 2018 Strategy and Performance update Oppor portu tunity ity Day 19 Novemb ember er 2018
Indu dustry stry Update pdate 2018 8 Key y Ac Achi hiev evemen ement Content tent Fi Financial ncial Pe Perform formance ance St Strategy ategy Out utloo look
Oil il Pric ices es Although global oil prices rally, volatility remains in focus US$ / Barrel rel Brent Min-Max Brent Analyst Consensus* 100 Dubai 90 90 80 80 Analyst Consensus 70 70 60 60 50 50 40 40 2018 1H actual 2018 Q3 actual 2018 consensus 2019 c onsensus Brent 70.6 $/BBL Q4 Brent 77 $/BBL Brent 75.2 $/BBL 30 30 FY Brent 75 US$/BBL Dubai 68.0 $/BBL FY Brent 74 $/BBL Dubai 74.2 $/BBL Spread 2.6 $/BBL Spread 1.0 $/BBL 20 20 Q1 Jan-18 Ja Apr pr-18 -18 Q2 Ju Jul- l-18 Q3 Oct Oct-18 -18 Q4 Jan-19 Ja Apr pr-19 -19 Jul- Ju l-19 Oct-19 Oct -19 Jan-20 Ja Q1 Q2 Q4 Q3 201 8 201 9 Short-term erm Key Drivers ivers & Outlook Ira ran n Supp pply ly Shortage ge & OPEC Spare re Cap US S Pipeli peline e Bottlen enec eck Soften ened ed Global l Dema mand nd & other bearis rish h • Sanct • Permian ction ion can halt Iran n supp pply y up to 1 MMBPD PD rmian capaci city y rema main ins limi imited ed and US US-Chin ina trade war tempora porary ry truck ck movemen vement is expens pensive ive • OPEC C spare re capaci citie ies mainl nly y from Saudi di • Tension provokes risks on confidence and • Howeve Arabia bia, , Kuwait wait and UAE are eroding ding ever r pipeli peline e constru ruct ction ion is on track to pressures global economic growth comple plete e in Q3 2019 Global l economy nomy slowdo wdown wn Q4 2018 18 OPEC PEC spare capaci city US Pipeline ne capacit city • IMF cut 2018-2019 global growth forecast 2 6.5 Pipeline capacity Supply forcast from 3.9% to 3.7% In 1 month In 9 months Liquid volume MBPD 1.5 5.5 Mini nimal l Iran Sanctio ion n impact ct Disrupted Spare Capacity MBPD • US waived Iranian crude import for some 1 4.5 countries • EU set up Special Purpose Vehicle (SPV) to 0.5 3.5 trade with Iran after US sanction 0 2.5 Saudi Kuwait UAE Iran Iraq&Libya Other Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20 Arabia OPEC Remark: * Bloomberg Analyst Consensus (CPFC) as of 2 Nov 2018 and Wood Mackenzie, Reuters 5
Indu dustry stry Update pdate 2018 8 Key y Ac Achi hiev evemen ement Content tent Fi Financial ncial Pe Perform formance ance St Strategy ategy Out utloo look
A A Fi Firm Core for Accretive tive Grow owth th Reflected in 9M2018 performance Op Opera ratio tion Financ ancial ials Healthy lthy marg rgin n and liquidi uidity ty 300 0 KBOED D 73 73% % EBITDA Margin On On-tr track ack sales s volume ume target 31.28 $/BOE BOE $ 3 . 8 Bn Bn Cash on hand Compe petitive titive unit t cost $2.3B .3Bn Operating Cash Flow d Bongkot gkot acquisit Achieve ieved uisition ion 0. 0. 17 x & Explor loratio ation expansi & ansion n Gearing ratio Unlocking king value ue throug ough h series s of portfo folio lio rationalizat alization ion St Strengthen gthen focus us area Reposition on non-core core Acquisit uisition Expand anded ed Explo loratio ation n Portfo folio lio Dives estment ment Bongkot ot 2 Deepw 2 epwater ter blocks cks in 2 S Shallow llow-water ter blocks cks in Complete leted 22.2222% stake e Dives estme tment nt of Montara ra Oil Field eld Mexico ico Malaysia sia acquis uisitio ition n in Bongkot kot in Austra rali lia with th pruden ent t operato tors rs as an operator ator from Shell ll 3
Indu dustry stry Update pdate 2018 8 Key y Ac Achi hiev evemen ement Content tent Fi Financial ncial Pe Perform formance ance St Strategy ategy Out utloo look
Key Perfor orma mance nce Driv ivers rs Generated solid operating cash flow 9M2018 driven by strong core performance Average Sale Selling Volumes mes Thailand & Price Other SEA Rest of world MTJDA 9M 9M 2% 2% YTD 2018 2018 2017 2017 21 21% YTD 300,33 ,338 294,53 ,539 6.24 5.54 Gas ($/MMB MMBTU) U) 67.85 49.87 Boosted up by higher Liquid ($/BBL) Better global oil : BOED nomination in Contract 4 46.25 38.29 Weighte hted Avg. ($/BOE) price led to MTJDA, and the improved ASP 70.10 51.06 Avg. . Dubai ($/BBL) Unit: completion of Bongkot Avg. . HSFO FO ($/BBL) 65.15 47.79 Acquisition (High Sulphur Fuel Oil) uid) 71:29 70:30 Volume Mix (Gas s : Liqui 9M 2018 9M 2017 Sourc rce e & Unit Cost Uses s of Fund d 2,397* 3,061 61** ** 10% YTD 10 3,000 Divestme stment Debt payme ment & of Asset t: MMUSD SD Finance cost st 9M 9M 2,000 Driven by higher Dividend 2018 2018 2017 2017 Unit : $/BOE Operatin ing Unit: cash sh flow ow royalties and DD&A Business ss Purcha hase 1,000 14.64 13.25 Cash cost st from Bongkot CAPEX EX & Others 16.64 15.11 Non-Ca Cashcost st acquisition and more - 31.28* 28.36 Unit cost st Sourc Sources es Uses Uses completed asset in S1 73 73% Maintain strong OCF and sustain EBITDA Margin level EBITDA TDA Margin Remark: * Net of adjustment for the effect of exchange rate changes on cash and cash equivalents Note: * Exclude costs related to new business, if include, unit cost for 9M 2018 will be 31.35$/BOE ** Excludes cash flows for short-term investments fixed deposit > 3 months) 7
Finan Fi ancial cial Position ition an and Outlook look Healthy balance sheet, well positioned for future growth ….Expect strong 2018 core performance Capital ital Str tructure ture MMUSD USD D/E Ratio Average ge Sales es Volum lume* e* 25,000 1.00 ~310 KBOED ~310 19,220 19,21 210 20,000 0.80 ED 4,796 5,486 15,000 0.60 2,907 1,947 10,000 0.40 11,51 ,517 11,77 ,777 Average ge Gas Price** e** ~6.5 $/M ~6. 0.25 5,000 0.20 0.17 /MMBTU MBTU 0 0.00 FY 201 FY 2017 9M 20 M 2018 Other liabilities Interest bearing- Gearing ratio Equity (LHS) Unit t Cost st (LHS) debt (LHS) ~31 $/BOE ~31 Debt bt Profil ile* e* US$ 100% US$ 100% Weighted Average 4.50 5.32 EBIT ITDA DA Margi rgin Cost of Debt* (%) 70 70-75 75 % [Fixed : Floating] [80 : 20] [100 : 0] Average Loan Life* Of sales es revenue nue 7.15 8.91 (Years) Remark: * Excludes Hybrid bonds Note: * Included sales volume from 1) the additional stakes in Bongkot and 2) Montara until the divestment completion ** Based on FY2018 Dubai oil price at 72 $/BBL 8
Indu dustry stry Update pdate 2018 8 Key y Ac Achi hiev evemen ement Content tent Fi Financial ncial Pe Perform formance ance St Strategy ategy Out utloo look
Strateg ategic ic Busin iness ss Pla lan Continue to operate under 3Rs “RESET REFOCUS and RENEW” RES ESET ET Aspir iratio ation n Prod oductio uction n Implemen ement digitalizatio gitalization n Poten ential ial to supply y Dives est non-co core e asset ets, , to improve ve product uctiv ivit ity y Growt wth h and Sustain ain Cost more e gas from m Accele elerate ate and/or /or De- and sust stain ain cost curren ent level el Compet etit itiven venes ess risk sk explo loratio ation n projec jects compet etit itiv iven enes ess REFO RE FOCUS US Coming ing-home home strate ategy gy: Realiz alize e E&P growt wth h and build ild up Captur ure e LNG value lue • Focus us on gas security curity for Thailand land healthy lthy portfo folio: io: chain in opportunit unity E&P Growt wth h to • Acce cele lera rate e explo plora ration ion in • Consoli lida date e TH opportunities unities Increas ease e R/P Myanm nmar r and Malays ysia ia • Expa pand nd M&A and EXP in SEA • Attempt mpt to enter er ME resil ilie ience ce proje ject REN ENEW EW Trans ansfo form m PTTEP EP to an agile, ile, Add new line e of busines iness lean n and innovativ vative e (G2P, , Robotic, ic, AI and others) ers) organiza anization ion New Opportunit unities ies 10 10
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