SUMATEC

SUMATEC
Sumatec Resources Berhad
EGM 21st June 2013
EGM 21
June 2013
Presentation to Shareholders
By Chris Dalton
Chief Executive Officer
THE Leading Malaysian Independent Oil & Gas Company
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Key Messages
• Deliver Long Term Profitable Growth
g
• Proven Mature Asset Portfolio
Proven Mature Asset Portfolio
• Creating Value for Share Holders
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Why Sumatec is Different!
O
Operator: E&P’s
t E&P’
E&
&P
Exploration Companies
SUMATEC
Hibiscus
Equity / Concession
Production Sharing Contracts (PSC)
Joint Investment Agreements (JIA)
Scomi
Sco
S
SapuraKencana
K
Service Uzma
UMW
Dialog
a og
Wah Seong
Service Companies
SUMATEC
Risk Service Contracts
THE Leading Malaysian Independent Oil & Gas Company
Why Kazakhstan
Largest land locked country & Largest
land locked country &
th
9 largest globally
GDP Per Capita 13,892USD (2012 estimate)
Geopolitical Advantages
Developed economy and legal system
Stable political environment
Well established Oil & Gas legislation
Established export routes for sale of hydrocarbons
Concession contracts as opposed to PSC & RSC
Geological Advantages
Geological Advantages
30billion bbls of proven reserves (ranked 11th in the world, largest in central asia)
1.6mmbbl/day production, double by 2020
Low risk onshore mature assets
High potential of increasing reserves in our asset
High potential of increasing reserves in our asset
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Why Mature Assets
• 70% of world production is from Mature Assets
70% of world production is from Mature Assets
• New Technology is increasing recovery factor (RF) from 20% to 40%
• Many Mature Assets today have only 15‐20% RF, leaving un tapped potential
• Majority of Assets are too small for Super Majors to operate at a cost effective level
• Proven Reserves & Track Record Reduces Capital Risk
Proven Reserves & Track Record Reduces Capital Risk
3 - 5years
<1 yr
Bidding/
Acquisition
Exploration
• Licensing Round
• Contract
Negotiation
• Work Program
• Fiscal Regime
•
•
•
•
$5-10m
USD
D million
140
120
Risk
Profile
100
1 yr
40
15 – 20 years
Appraisal
Early Production
Commercial Scale
Production
Geological Study
Seismic Survey
Exploration Wells
Reservoir
Mapping
• Delineation wells
• Confirm Reserves
• Development
Concepts
• Construction of
surface facilities
• Drilling of
production wells
• Upgrade surface facilities
• Expanded drilling
program
$30-40m
$15-20m
$30-40m
More than $50m
• Hi
High
h risk
i k mainly
i l on exploration
l
ti
• Low certainty of oil/gas content
• If there is no oil and gas find,
the exploration costs will be
totally lost
80
60
2 – 3 years
• No more exploration risk
• Oil reserves confirmed and
certified
Cumulative Cost
Profile
20
C
Current
status off
Rakushechnoye
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Rakushechnoye Investment
What will Sumatec pay:
• 10M USD Signature Bonus
• 85M USD Historical Costs
• 40M USD Performance Guarantee to be offset against Royalty @ USD5/BBL
What will Sumatec receive:
Wh
t ill S
t
i
• 100% of Net Income for first 2M BBLS
• 50% of Net Income after 2M
• Concession period to 2025, can be extended with approval of RoK
Concession period to 2025 can be extended with approval of RoK MOG
• All CAPEX & OPEX recovered as part of petroleum operations
• Sustainable growth in PROVEN Mature Asset
• Initial Investment recovered in first 3 years profits
Initial Investment recovered in first 3 years profits
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Entry Price for Sumatec Compared to Peers
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Rakushechnoye Field is a Mature Asset
• Concession area: 354km2 with subsurface user rights till 2025
• 1st Well Drilled in 1974
•47 Wells Drilled
•3D Seismic acquired 2008
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Rakushechnoye Field Reserves
(mmboe)
Oil
Gas
Total Oil and Gas
8 gas / gas condensate, Proved
5.2
17.2
22.4
2 oil saturated.
Proved + Probable
32.8
89.3
122.1
10 Reservoir Zones: 4.7 mmbbl of oil and 51BSCF of Gas has been produced which is less than 10% of the original oil and gas Proved + Probable +
74.7
257.0
Possible
6000SCF = 1BOE
6000SCF = 1BOE.
Reserves Certified by SRK Consulting (Australia) Pty Ltd February 2013
in place
331.7
Conservative RF: “20% RF for Oil & 25% RF for Gas”
Reserves from 9% of Concession Area
Identified Hydrocarbons in south with potential to double total reserves
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Proved Reserves is Low Risk, High Potential of Additional Reserves
dd
l
• Normally pressured at reservoir
• Compartmentalized in the north , a lot of by passed oil
• Two main reservoir drainage areas – north – commercial , South untested
• Formations have more lateral extension compared to
north.
• Less faulting, natural closures
• Southern area yet to be tested for commercial potential.
Is not part of 2P reserve calculations
• Triassic reservoir: gas condensate and oil
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Rakushechnoye Development Schedule
Phase 1:
Phase 2:
Phase 3:
2013
2014‐2015
2016>
Sti l ti & W k
Stimulation & Workovers
Sid t k
Sidetracks
N W ll
New Wells
1000‐2000bbl/day 4000‐6000bbl/day
>8000bb/day
Oil Production Oil & Condensate Production with Gas Injection
with Gas Injection
Oil & Gas Production
New Storage Facility New Processing & Injection Facilities Pipeline for Oil & Gas Export
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Risk Assessment
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
5 Year Business Targets
Large Independent Oil & Gas Company
>200 million bbls
Proved Reserves
8000bbls/day (2.9M bbl/year)
2 Million Bbls From Rakushechnoye
New Acquisitions
Revenue RM
Rakushechnoye
y
Operations
Rakushechnoye
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
SUMATEC
Oil & GAS
New Management and Strategy
N B d f Di
New Board of Directors & Top Level Management
&T L lM
Safety Culture embedded in all out activities
Minimizing Environmental Impact
Focus on Innovation and Efficiency
High
High Ethical Standards demanded from all employees
Ethical Standards demanded from all employees
Rebranding of the Company
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
Redesigned www.sumatec.com Launched Today
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
New Investor Relations Section
SUMATEC
THE Leading Malaysian Independent Oil & Gas Company
New Management
Executive Team
Executive Team
Chris Dalton
Chief Executive Officer
Joined Sumatec June 2012
17 Year Industry Experience
17 Year Industry Experience with Halliburton
Chingis Nabiyev
Technical Director
Based in Almaty
To Be Appointed in August 2013
August 2013
13 Years Industry Experience with Schlumberger
SUMATEC
Zulkifly Mohamad
Chief Operations Officer
Based in Almaty
T B A
To Be Appointed in August 2013
i t di A
t 2013
30+ Years Industry Experience with Schlumberger including 10 Years as Country Manager in Kazakhstan
Technical Leaders
Samuel Elliot Harvey
Operations Director
Based in Aktau
To Be Appointed in August 2013
15 Years Industry Experience with Schlumberger
Roshidah Abdullah
Chief Financial Officer
Joined Sumatec June 2013
24 Years Experience in Financial
24 Years Experience in Financial Management & Operations
Bakhtiyar Jexenbiyev
QHSE Director
Based in Aktau
To Be Appointed in August 2013
12 Years Industry Experience with Multi‐National Corporations
THE Leading Malaysian Independent Oil & Gas Company
Management KPIs
Shareholder Value
Staff & Talent
Company Values
C t
Cost per bbl
bbl
SUMATEC
Daily Production
Production Increase
Total Total
Reserves
THE Leading Malaysian Independent Oil & Gas Company
SUMATEC
Oil & GAS
THE leading Malaysian Independent Oil & Gas Company
Deliver Long Term Profitable Growth
Proven Mature Asset Portfolio
Creating Value for Share holders
SUMATEC
• Large Independent • Sustainable growth from initial proven reserves
• Rakuschechnoye Low Risk / High Potential
• Acquire own Assets with 24 months
A i
A
i h 24
h
• Free Cash Flow from Oil Sales
Free Cash Flow from Oil Sales
• Attractive Profit Margin & Dividend
THE Leading Malaysian Independent Oil & Gas Company