180829 corporate overview final - president energy plc · 16. w et e 17 s • e ) • pd ex , s •...

July 2018 | Corporate Overview

CORPORATE OVERVIEW

Augu

st 2

018


DISCLAIMER

Slide 2

The information contained in this confidential document ("Presentation") has been prepared by President Energy plc (the "Company"). This Presentation has not been approved by an authorised person in accordance with Section 21 of the Financial Services and Markets Act 2000 ("FSMA") and therefore it is being delivered for information purposes only to a very limited number of persons and companies being: (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO"); (ii) high net-worth companies, unincorporated associations and other bodies within the meaning of Article 49 of the FPO; and (iii) persons to whom it is otherwise lawful to make the Presentation. Any other person who receives this Presentation should not rely or act upon it. By accepting this Presentation and not immediately returning it, the recipient represents and warrants that they are a person who falls within the above description of persons entitled to receive the Presentation. This Presentation is not to be disclosed to any other person or used for any other purpose.

Please note that the information in this Presentation has yet to be announced or otherwise made public and as such constitutes non-public price sensitive information for the purposes of the Criminal Justice Act 1993 and inside information for the purposes of the Market Abuse Regulation 596/2014. You should keep confidential the information contained in this Presentation and not deal in any way in the securities of the Company until after the formal release of an announcement by the Company as to do so may result in civil and/or criminal liability.

While the information contained herein has been prepared in good faith, none of the Company, finnCap Limited ("finncCap") or any of their respective shareholders, directors, officers, agents, employees or advisers give, have given or have authority to give, any representations or warranties (express or implied) as to, or in relation to, the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof, or of any other written or oral information made or to be made available to any interested party or its advisers (all such information being referred to as "Information") and liability therefore is expressly disclaimed. Accordingly, none of the Company, FinnCap or any of their respective shareholders, directors, officers, agents, employees or advisers take any responsibility for, or will accept any liability, whether direct or indirect, express or implied, contractual, tortious, statutory or otherwise, in respect of, the accuracy or completeness of the Information or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising, from the use of this Presentation. This Presentation may contain forward-looking statements that involve substantial risks and uncertainties, and actual results and developments may differ materially from those expressed or implied by these statements. These forward-looking statements are statements regarding the Company's intentions, beliefs or current expectations concerning, among other things, the Company's results of operations, financial condition, prospects, growth, strategies and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. These forward-looking statements speak only as of the date of this Presentation and the Company does not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Presentation.

Neither the issue of this Presentation nor any part of its contents is to be taken as any form of commitment on the part of the Company to proceed with any transaction and the right is reserved to terminate any discussions or negotiations with any prospective investors. In no circumstances will the Company be responsible for any costs, losses or expenses incurred in connection with any appraisal or investigation of the Company. In furnishing this Presentation, none of the Company or FinnCap undertakes or agrees to any obligation to provide the recipient with access to any additional information or to update this Presentation or to correct any inaccuracies in, or omissions from, this Presentation which may become apparent. This Presentation should not be considered as the giving of investment advice by the Company or FinnCap or any of their respective shareholders, directors, officers, agents, employees or advisers. In particular, this Presentation does not constitute an offer or invitation to subscribe for or purchase any securities and neither this Presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever. Each party to whom this Presentation is made available must make its own independent assessment of the Company after making such investigations and taking such advice as may be deemed necessary. In particular, any estimates or projections or opinions contained herein necessarily involve significant elements of subjective judgment, analysis and assumptions and each recipient should satisfy itself in relation to such matters.

FinnCap which is authorised and regulated in the United Kingdom by the Financial Conduct Authority, is acting only for the Company in the provision of corporate finance business, within the meaning of the Financial Conduct Authority’s ("FCA") Conduct of Business Sourcebook ("COBS"), and no-one else in connection with the matters contained in the Presentation. Accordingly, FinnCap is not acting for or advising any other person, or treating any other person (whether or not a recipient of this Presentation) as its clients, in relation thereto and will not be responsible for providing regulatory protection afforded to its clients or advice to any other person in relation to the matters contained in the Presentation. Apart from the responsibilities and liabilities, if any, which may be imposed on it by the FSMA, FinnCap accordingly disclaims to the fullest extent permitted by law all and any responsibility and liability whether arising in tort, contract or otherwise which it might otherwise have in respect of this Presentation.

Neither this Presentation nor any copy of it may be (a) taken or transmitted into Australia, Canada, Japan, the Republic of Ireland, the Republic of South Africa or the United States of America (each a "Restricted Territory"), their territories or possessions; (b) distributed to any U.S. person (as defined in Regulation S under the United States Securities Act of 1933 (as amended)) or (c) distributed to any individual outside a Restricted Territory who is a resident thereof in any such case for the purpose of offer for sale or solicitation or invitation to buy or subscribe any securities or in the context where its distribution may be construed as such offer, solicitation or invitation, in any such case except in compliance with any applicable exemption. The distribution of this document in or to persons subject to other jurisdictions may be restricted by law and persons into whose possession this Presentation comes should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of the laws of the relevant jurisdiction.


CORPORATE SUMMARY

* Estimated annualised for whole 2018 on basis of first half 2018

Current Estimated Annualised Turnover*

+/-US$50Million

Current Group Production

+/- 2,700BOEPD

Reserves(Independently

Certified Reserves)

1P > 15MMBOE

2P > 27MMBOE

Prospective Resources

Argentina194 MMBBLS

7 TCF

ParaguayOver 500

MMBOE

Significant Shareholders(as at 20th July 2018)

29.9%

14.3%8.9%

8.9%

27.6%

Peter Levine (PLLG Investments)

Schroders Investment Management

IFC (World Bank Group)

Michinoko LtdJP Morgan Asset Management

Other10.4%

Slide 3


KEY INVESTMENT CONSIDERATIONS

Slide 4

High QualityExisting Portfolio

With strong operating cashflow

gives solid foundation, limited

downside and multiple

financing options;

UnparalleledAlignment

Between management and

shareholders gives strong

focus on sustainable value

creation

OperationalExcellence

Of in-country team employing

high standards of QHSE, corporate

and operating governance, cost

discipline and accountability

Considerable Upside Potential from Three Sources

ROBUST EXISTING PLATFORM

>100% upside potential in

production from existing

assets

High potential exploration

opportunities in Argentina and

Paraguay to be drilled in 2019

Multiple additional

non-organic opportunities

under evaluation


OBJECTIVE AND STRATEGY

Generate MATERIAL SUSTAINABLE VALUE GROWTH

for shareholders through:

Focus on high margin production from

conventional assets, not barrels per se

Slide 5

Regional focus which enables “cleaner” investment thesis

and more effective use of management resources

Operatorship of our assets which is key to

enabling tight cost control and focus on delivery

Inclusion of material exploration activity only

where appropriate as part of balanced portfolio

FOCUS STRATEGY CONTROL PORTFOLIO


DRIVING SUSTAINABLE VALUE GROWTH IS KEY

Slide 6

WE ARE DELIVERING IN OUR CURRENT ASSETS

Attractive

AcquisitionCost

Workovers

Opex

Reduction

G&A

Reduction

Infill

Drilling

Potential

NAV

Exploration

Upside

Improved

CommercialTerms

Net Asset

Value


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BOARD OF DIRECTORS AND SENIOR MANAGEMENT

PRESIDENT BOARD OF DIRECTORS

Peter Levine

Chairman andGroup CEO

30 years industry

Rob Shepherd

Finance Director

28 years industry

Jorge Bongiovanni

Non-Executive Director

40+ years industry

Alex Moody-Stuart

Non-Executive Director

30 years industry

Warren Levy

Chief Operating Officer

23 years industry19 years LatAm

LATIN AMERICAN OPERATIONAL MANAGEMENT USA OPERATIONAL MGT

Victor Linari

Chief Geologist

35+ years industry

Claudia Perez

FinanceDirector

25+ years industry

Lucia D’Agostino

LegalDirector

10 years industry

Jordan Coleman

Production Manager

12 years industry5 years LatAm

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Scott Daspit

OperationsManager

35+ years industry

Slide 7


WHERE WE OPERATE

Slide 8

Argentina

Puesto Guardian(Five Oil Fields)Production(Operator) 100%

MatorrasExploration(Operator) 100%

Puesto Flores/Estancia Vieja (Two Fields) Production(Operator) 90%

OcultarExploration (Operator) 100%

1

2

3

4/5

USA

Paraguay

Production

East Lake VerretProduction (Operator)

1

Hernandarias (Earn In)Exploration (Operator) 40% & 80%

PirityExploration (Operator) 100%

1

2

Argentina

USA

Proved +ProbableReserves

Resources

Argentina

Paraguay

Argentina

USA


ARGENTINARegional Hotspot for Oil and Gas Investment

Slide 9


WHY ARGENTINA?

Slide 10

Robust, high quality local service sector

Government Promoting Foreign Investment through Stability and Transparency

($50 Billion IMF Loan)

Considerable Goodwill from International

Community

President Of

G20 In 2018, Pursuing

OECD Membership

Ongoing Deregulation

of EG Capital Markets

Corporate Tax reduced to

30%from 35% in 2018

and to 25% in 2020

LONG ESTABLISHED OIL AND GAS INDUSTRY:

PROGRESSIVE, PRO BUSINESS GOVERNMENT:


Slide 11

PARTNERED WITH PROVINCIAL OIL COMPANY EDIPHSA (10%)TWO PRODUCING FIELDS, ACQUIRED FOR REACTIVATION AND REDEVELOPMENT POTENTIAL

OIL AND GAS SALES VIA PIPELINE TO REGIONAL HUB

Rio Negro Province, Argentina – Concession Licence to 2027 (with extension rights)

PUESTO FLORES / ESTANCIA VIEJA CONCESSION


Slide 12

Rio Negro Province, Argentina

PUESTO FLORES FIELD

HIGH QUALITY MARGINAL FIELD, READY FOR REACTIVATION AND OPTIMIZATION

COMPLETED• Reactivate Field• Two workover

programs completed (5 + 10 wells)

• Battery Improvements• Production up 50%

UNDERWAY• Water injection

system upgrades• Field subsurface

evaluation• 3 well drilling program

Sept 2018

UP NEXT• Further development

drilling and field extension 2019

0

5

10

Sep '17 Jun '18

2P reserves (mmboe)

0

5

10

15

20

25

Sep '17 Jun '18Unit opex ($/boe)

0

500

1000

1500

2000

Sep '17 Jun '18Daily Production (boepd)

66%

58%

38%


Slide 13

Rio Negro Province, Argentina

ESTANCIA VIEJA FIELD

HISTORICALLY LARGE PRODUCING FIELD (9,000 BOED AT PEAK). NOW SHUT IN BUT WITH FUTURE REMAINING

COMPLETED• Full facilities review• Reactivate 2 oil wells

and 3 gas wells• Install electrical

system

UNDERWAY• Long term gas tests• Installation of power

generation to power EV and Puesto Flores Fields

UP NEXT• Bring additional gas

online • Continue to reactivate

oil wells• Development drilling -

2019


PUESTO GUARDIAN CONCESSION

Slide 14

Salta Province, Argentina – Concession Licence to 2050

1P: 10.2

2P 8.4

Oil Reserves(MMBbls) 100% - LONG TERM DEVELOPMENT CONCESSION

CLUSTER OF FIVE PRODUCING FIELDS

OIL SALES VIA TRUCK TO LOCAL REGIONAL REFINERY

18.6MMBbls


PUESTO GUARDIAN CONCESSION

Slide 15

Salta Province, Argentina

OPERATIONALLY PROFITABLE GENERATING POSITIVE FREE

CASH FLOW

28

30

32

34

36

38

2016 2017 - H1 '18

Unit opex ($/boe)

16%

30 YEAR OLD FIELD THAT WAS POORLY RUN, NOW STABILIZED AND PRIMED FOR FUTURE DEVELOPMENT.

COMPLETED• Improvement in field and

battery operations• Stabilized production via jet

pump system• Full reprocessing of seismic

UNDERWAY• Upgrades to battery • Use of gas to power

dual fuel engines• Subsurface review

UP NEXT• Continue to optimize

operating costs• Development drilling -

2019


LOUISIANAStable cash flow from reliable operation

Slide 16


EAST LAKE VERRET LICENCE

Slide 17

Louisiana, United States

• Operated interests in two producing wells: Triche (62.5% WI, 37.5% NRI) and Simmons (43.9% WI and 33.3%

NRI)

• Currently producing in excess of 300 boepd, generating over US$200k per month in free cash flow after all opex,

G&A and taxes

• Benefit from accrued tax losses which are being utilised giving potential for further accretive acquisitions of

operated assets

• Connection with US market for technology transfer and support

USA

East Lake VerretProduction (Operator)

1


INDICATIVE ACTIVITY IN EXISTING ASSETS

Slide 18

ACTIVITY H2 2018 H1 2019 H2 2019 H1 2020 H2 2020

PUESTO FLORES

Drilling - Development

Drilling - Exploration

Workover

ESTANCIA VIEJA



Workover

PUESTO GUARDIAN



Workover

PARAGUAY Drilling - Exploration


MULTIPLE SOURCES OF INORGANIC GROWTH

Slide 19

Unlocking value through focused operational improvements

Majors refocusing on unconventional assets

Family owned businesses with limited access to capital

Direct negotiations

with Provinces


INDICATIVE NEAR TERM PRODUCTION FORECAST

Slide 20

SOLID GROWTH FROM EXISTING ASSETS WITH MEANINGFUL UPSIDEFROM ACQUISITION TARGETS

Jan'18

Jan'19

Dec'19

Acquisition 2

Acquisition 1

Puesto Flores

Puesto Guardian

Lousiana


KEY INVESTMENT CONSIDERATIONS

Slide 21

High QualityExisting Portfolio

With strong operating cashflow gives solid foundation, limited

downside and multiple financing options;

UnparalleledAlignment

Between management and shareholders gives strong focus on sustainable value

creation

OperationalExcellence

Of in-country team employing high standards of QHSE, corporate

and operating governance, cost discipline and accountability

Considerable Upside Potential from Three Sources

ROBUST EXISTING PLATFORM

>100% upside potential in production from existing

assets

High potential exploration opportunities in Argentina and Paraguay to be drilled in 2019

Multiple additional non-organic opportunities

under evaluation


Office Headquarters1200 Century Way, Thorpe Park Business ParkLeeds, LS15 8ZA. United Kingdom

Argentine OfficeJuana Manso 1750, Complejo ZencityEdificio Esmarelda, 3er Piso Norte, C1107CHJ. Buenos Aires, Argentina

Tel: +54 (11) 4317 0400

Paraguay OfficeAsuncion, Paraguay

USA Office2020 W Pinhook, Ste 201LafayetteLA70508USA

Thankyou

© 2018 President Energy PLC

Company Registered Office1200 Century WayThorpe Park Business ParkLeeds, LS15 8ZA, United Kingdom

Tel: +44 (0) 20 7016 7950

180829 corporate overview final - president energy plc · 16. w et e 17 s • e ) • pd ex , s •...

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