oil capital conference: “progressing to drilling”...ü fiscal terms embodied in licence...

Oil Capital Conference:

“Progressing to Drilling”

London12 September 2019

Simon Potter – Chief Executive Officer

Visit our website: www.bpcplc.com

http://www.bpcplc.com/

BPC Oil Capital Conference – September 2019

This presentation (“Presentation”) has been prepared by Bahamas Petroleum Company plc(the “Company”) solely for its use at informational meetings with prospective investors inthe Company or its projects, and is being delivered for information purposes only to alimited number of persons. This Presentation should not be considered as the giving ofinvestment advice by the Company or any persons, including to any of its shareholders,officers or advisers. If you are in any doubt about the contents of this Presentation or theaction you should take, you should consult an independent adviser authorised to rendersuch advice.This Presentation has not been independently verified and is subject to material updating,revision and further amendments without notice. The Presentation does not purport tocontain all information that an investor in the Company or its projects may wish to receivefor the purposes of assessment or valuation of that investment and is not intended to formthe basis of any investment decision.While the information contained herein has been prepared in good faith, neither theCompany nor its shareholders, directors, officers, agents, employees, or advisors give, hasgiven or has authority to give, any representations or warranties (express or implied) as tothe achievement or reasonableness of future projections, management targets, estimates,prospects or returns contained in this presentation, or in relation to the accuracy, reliabilityor completeness of the information in this Presentation, or any revision thereof, or of anyother written or oral information made or to be made available to any investor (all suchinformation being referred to as “Information”).The Presentation is not an offer or invitation by the Company, its shareholders, directors,officers, agents, employees, or advisors to purchase, acquire or sell securities or assets, norany form of commitment, legal obligation or recommendation by the Company, itsshareholders, directors, officers, agents, employees, or advisors.So far as permitted by law, neither the Company nor any of its shareholders, directors,officers, agents, employees or advisers take any responsibility for, or will accept any liabilityin respect of, the accuracy, reliability or completeness of the Information or for any loss,howsoever arising from the use of this Presentation. In furnishing this Presentation, theCompany does not undertake any obligation to provide any additional information or toupdate this Presentation or to correct any inaccuracies in, or omissions from, thisPresentation which may become apparent.The Information is confidential information and the property of the Company. It is madeavailable strictly for the purposes referred to above. The Information and any furtherconfidential information made available to any recipient must be held in completeconfidence and documents containing such information may not be reproduced directly orindirectly, used or disclosed without the prior written consent of the Company. By acceptingdelivery of this Presentation, the recipient agrees to return it at the request of the Company.This Presentation contains certain statements which may constitute forward-lookingstatements. All statements in this Presentation, other than statements of historical facts,that address future activities and events of developments that the Company expects, are

forward-looking statements. Although the Company believes that the expectations reflectedin these statements are based on reasonable assumptions, such statements are onlypredictions and are subject to inherent risks and uncertainties and changes in the underlyingassumptions which could cause actual values, results, performance or achievements to differmaterially from those expressed, implied or projected in any forward-looking statements.Factors that could cause actual results to differ materially from those in forward-lookingstatements include market prices, continued availability of capital and financing, and generaleconomic, market or business conditions. Investors are cautioned that any such statementsare not guarantees of future performance and that actual results or developments maydiffer materially from those projected in forward-looking statements.The Company will not undertake any obligation to release publicly any revisions to theseforward-looking statements to reflect events, circumstances or unanticipated eventsoccurring after the date of this Presentation, except as required by law or by any appropriateregulatory authority. Nothing in this Presentation or in documents referred to in it should beconsidered as a profit forecast. Past performance of the Company or its shares cannot berelied on as a guide to future performance.This Presentation does not constitute, or form part of or contain any offer or invitation tosell or issue, or any offer to subscribe for, underwrite or otherwise acquire, or dispose of,any securities in the Company in any jurisdiction and is directed at, and is only fordistribution in the United Kingdom to persons reasonably believed to fall within Article 19(Investment professionals) or Article 49 (High net worth companies, unincorporatedassociations etc.) of the Financial Services and Markets Act 2000 (Financial Promotion) Order2005 (SI 2005/1529) or to whom this Presentation may otherwise lawfully be distributed..Neither this Presentation nor any part of or copy of it may be taken or transmitted, directlyor indirectly, into the United States of America or Canada or distributed or re-distributeddirectly or indirectly, in the United States of America, its territories or possessions, orCanada, or to any resident thereof except in compliance with applicable securities laws. Anyfailure to comply with these restrictions may constitute a violation of applicable U.S. orCanadian securities laws. This Presentation and the information contained herein do notconstitute an offer of securities for sale in the United States. By accepting this Presentation,the recipient represents and warrants that it is a person to whom this Presentation may bedelivered or distributed without a violation of the laws of any relevant jurisdiction. ThisPresentation is not to be disclosed to any other person or used for any other purpose andany other person who receives this Presentation should not rely or act upon it.The delivery or distribution of this Presentation in or to persons in certain jurisdictions maybe restricted by law and persons into whose possession this Presentation comes shouldinform themselves about, and observe, any such restrictions. Any failure to comply withthese restrictions may constitute a violation of the laws of the relevant jurisdiction.By attending the meeting where this Presentation is made or distributed, or by reading thePresentation slides, you agree to be bound by these provisions.

Page 2

Disclaimer


Preparing to Drill in 1H2020

Continued Technical progression• Drilling Plan developed and refined • Geophysical support for DHIs• Ongoing technical work to support farm-in

and drilling site optimization

Executable Drilling Planü Key services and equipment providers -

Seadrill; Halliburton; BakerHughesü Strong executive & experienced drilling

team with track recordü Defined drilling philosophy and plan

Capitalü £10.25m convertible note (subject to due

diligence)ü Farm-in process continuesü Additional capital sources being evaluated

BPC is preparing for high-impact exploration drilling in 1H2020

World-class, de-risked, drill-ready prospects• Extensive historic / modern technical work• Multiple CPRs, independent reviews• Stacked play, multi-billion barrel potential

1

2Advantaged operations• Attractive, settled fiscal & regulatory regime• Excellent operating location & environment• Strong exploration metrics

3

5

6

STEPS TO VALUE DELIVERY

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7

Clear tenure and licence compliance ü Licence extension securedü Work obligation clearü EA process – completion target 1Q20

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World-Class, Technically De-risked, Drill-Ready Prospects

Technically De-risked

BPC’s assets

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• 4 commercially co-joined offshore licenses

• Moderate water depth - 500m / 1500 feet

• 12,600 km2 (> 3 mill acres), against Cuban border

• 9,400 km2 under application secures on-trend acreage / running room; play system secured

• 100% interest; operatorship

• 12 year exploration period (4×3 years); 30 year production lease entitlement on discovery

• 5 historic wells - live hydrocarbons in all wells; core, cuttings and logs retained

• 9,000 kms 2D (1,100 kms modern), 3,000 km2BroadSeis 3D seismic.

• > $US100 million spent to established provenance of petroleum systems,

• key source, maturity, migration pathways, reservoir and seal parameters well understood

Page 4

Cuba

Florida

Bahamas

3D SeismicArea

Co-joined Southern Licence Area

15 kms

Cay Sal #1

Doubloon Saxon #1

Great Isaac #1

Licence Applications

Regional 2DSeismic Coverage


Middle East Scale Structures – From 3D1

Page 5


A Company / Country Making Opportunity1

Over 20,000 feet (6,000 metres) stratigraphic column• Stacked plays from Upper Jurassic mega bank and reef

systems throughout the Lower Cretaceous

• Mapped structures over 70 kms long• vertical relief up to 1,000 meters; areal extent ~ 60 - 400

km2

• 25%-33% CoS => Risked Mean Resource > 0.4 - 0.6 billion barrels • Ryder Scott 2011 CPR (based on 2D)

• Mean STOOIP estimate of 8 billion barrels, => Risked Mean Resource > 0.4 – 1.2 billion barrels • Moyes & Co. 2017 (incorporating 3D)

• Upside STOOIP estimates 28 billion barrels, => Risked Upside Resource > 1.4 – 3.9 billion barrels • Moyes & Co. 2017 (incorporating 3D)

• Successful proven adjacent analogues• Florida (Sunniland), North Cuba and Mexico (Golden

Lane/Salinas basin)

A rarely seen scale opportunity with multi-billion barrel potential

Page 6

Fold B North Fold C

Approx. 2 kms

Bahamas Petroleum Value Proposition (1)

Structure (Albian, Aptian only)

UnriskedSTOOIP Recovery Factor

Unrisked Mean EUR

Chance of Success

Billion Barrels % Billion Barrels %

Fold B 5.5 20% - 25% 1.3 23% - 35%

Fold C 1.7 20% - 25% 0.4 28% - 35%

Aggregate Total 7.2 20% - 25% 1.7 23% - 35%

Aggregate Moyes and Co (2017)(2)

8.3 – 28.0 (mean – upside) 20% - 40%

1.6 – 3.3 (mean range)

5.6 - 11.0(upside range)

25% - 35%

(1) As per RyderScott CPR (2011) based upon 2D seismic only(2) Utilizing modern 2D and 3D


The Bahamas represents an advantaged regulatory and operating environment

Advantaged Operations2

• Modernised and strengthened regulations now in placeü New Petroleum Act and associated regulations enacted in 2016 includes Sovereign Wealth Fund

Legislation. No domestic-use obligations

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• Commercially Robustü Fiscal terms embodied in licence agreements - include stabilization clauseü Net contractor-take consistent with frontier, new basin entry

ü Low minimum economic field size at c. 150 million barrelsü Estimated break even price: $30 - $40 / bbl

• Independent, sovereign democratic nation ü A Westminster-style democracy - Queen is titular head

of state. Final court of appeal is privy council, Londonü Commonwealth - Full member; Member of CARICOM ü Active and well regulated financial services sector

• Proximity to services and infrastructureü c.200 miles to US (Florida/GoM)ü World’s largest energy market, extensive infrastructure,

refining capacity, contractors, services and suppliersü Modest water depths 500m / 1500 feet.


3 Technical Progression

Recent technical work supports well location optimisation and farm-in processPaleogeographic restorationü the likely presence and quality of a

world-class source rock and petroleum system located precisely in the BPC licence area. Analogous to Smackover interval producing in US Gulf of Mexico

Geophysical / seismic interpretationü Company believes hydrocarbon

indicators established from 3D data; Amplitude conformance to structure, with amplitude termination; velocity variations suggestive of fracture porosity

Seismic Attribute Mapping ü presence and delineation of an

extensive fracture and fault system clearly demonstrated within the 3D seismic area - potential ‘sweet spots’ within the fracture / faulting network

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2028

Extension on Application

Single well obligation by end of current exploration periodü Licence extension secured February 2019; current (2nd) exploration term expires end of 2020

Clear Tenure and Work Obligation4

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20272026202520242023202120202019 20222018

Term 2

Term 3

Term 4

Well

Well

Well

Well

Entry to next term on submission

• 12 year Exploration Licence grant (4 x 3 years)• Entry into each term based on continued compliance. Annual fees• 30 year Production Lease – by right on application on discovery• Southern Licences offsetting obligations – “commercially co-joined”• Stabilization clause included in the licence agreements along with defined fiscal terms• Play fairway locked up with on-trend applications

Seismic Option - Drop Term 2Well

Licence Applications

Southern LicencesRenewal Option

FOCUS ON THE KEY VALUE DRIVER - THE DRILLING OF A WELLTHE NEXT 12 MONTHS WILL BE A COMPANY MAKING TIME FOR BPC

Renewal Option


• Environmental Impact Assessment (EIA)• Completed and Accepted by Government (2012)

ü Multi-beam Sea Bottom Survey and Assessment

ü Transport and fate of Oil Particles Modelling

ü Emergency Response Plan,

ü Environmental Sensitivity Maps and Index

• Environmental Authorisation (EA)ü Submitted to Government (2018)ü Bahamas Environment, Science & Technology (BEST)

Commission engaged Black & Veatchü In addition to EIA includes Environmental

Management Plan (EMP)

ü EMP thus EA requires rig / equipment / location specific data to complete – now available

ü Leading consultants appointed to assist with this process: Acorn, CSA Ocean Sciences

ü Membership of Oil Spill Response Limited

Final Permitting Processes Underway4

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Working with Government and on track to complete EA / EMP process by 1Q2020


5 Key Service and Equipment Providers

• Framework Agreement with Seadrill• Access to best-in-class 6th-generation rigs currently in Gulf

of Mexico• Day rate: US$215,000• Window for delivery 1H2020• Provides key inputs for final environmental permitting

• Notice of Award with Halliburton for integrated well services

• Notice of Award with BakerHughes GE for wellheads and large tubulars

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Initial agreements in place to provide access to key services and equipmentü Leading international providers – contracts to be finalised over coming monthsü Establishes rates / pricing; provides key inputs for final environmental permitting


5 Drilling Plan for the Proposed Well(s)

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Obligation Well• Exploration well ‘capable of a depth of 18,000 ft’

Target depth 21,500 feet - Full Cretaceous section• To be commenced in 2020 - Rig available 1H2020 • Option exists to include a 2nd well• Well locations at B North and C structures - lower

prospect risk - more complete top seal cover

B North

B South

Fold C

10 km.

• Estimate US$25m – US$30m one well; US$50m two wells;

Genuine Cost Reduction• Calculated 40-60 days drill time - including mob / demob• Framework Agreement rig rate – US$ 215K /day• Rig sourced from Gulf of Mexico. Logistical support• Technical advances in drill bit technologies

Drilling Philosophy / Hole Design• Rate of Penetration (ROP) is key. Weight on bit, combined

with hybrid bit design• MWD assembly integrity – logging tools location close to bit• Slimmer hole – Bottom hole 8 !" inch (6

!" inch contingency)

• Integrated Well Services team


Non-Executive Board

Bill SchraderChairman

Ex-BP 30 years; Director of Hess and Chairman Ophir; extensive industry network and experience

James Smith Ex-Bahamas Minister of State, Ministry of Finance; widely acknowledged monetary policy expert

Adrian Collins +35 years fund management experience; ex-MDGartmore Investment Management; Chairman LiontrustAsset Management plc

Edward Shallcross Fellow - Chartered Institute of Bankers; +40 years financial sector experience; ex-Senior Executive Director Barclays PLC

Ross McDonald +35 years Royal Bank of Canada, ex-Senior Vice President & Head of Caribbean Banking

Executive

Simon PotterCEO & MD

Qualified geologist; 40 years oil & gas / mining sector;ex-BP 20 years; CEO TNK-BP, Hardman, Dart Energy

Eytan UlielCommercial Director

20 years O&G / resources & commercial experience, CCO / CFO - Arrow/ Dart

Ben ProffittFinance Director

10 years O&G / resources experience, qualified CA, Company Secretary

Experienced Team5

Operations

Randolph HiscockTechnical Advisor

+30 years exploration, new ventures/business development experience, geologist, ex-Shell

Jobeth Coleby-DavisLegal Counsel

10 years experience, specialist Bahamian O&G regulatory expertise, member of the Bahamas Senate (Upper House)

Roberta Quant Environment Manager

10 years experience, ex-Bahamas Environment, Science & Technology Commission

Drilling

Dave BondDrilling Director

35 year experience in offshore drilling, senior roles multinational roles including Ophir & Woodside

Richard TurnerDrilling Manager

40 years managing complex drilling operations in international locations with majors / independents

Jane BondSubsurface Manager

20 years experience in geology, seismic interpretation, petrophysics and reservoir engineering

A strong team is in place, capable of delivering the well(s)

• Deep international operating / domestic Bahamian capability

• Experience and delivery track-record with global majors and entrepreneurial juniors

• New company-wide incentive plan ensures alignment with shareholder value creation

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6 Capital

Making progress on securing the funding required for drillingü Clear objective: to secure funding to enable drilling of well(s) in 1H2020ü Funding required: one well US$25m – US$30m; two wells US$50m

Convertible Note

• £10.25m (US$ 12.5) – cover initial costs, ultimately c. half the cost of the initial well

• Australian investors with successful track record in international O&G; prior working relationship with CEO / CCO

• 12% coupon, 3 year term, convertible at 6p or 25% premium to any future well financing

• Conditional agreement subject to final contract / due diligence and securing balance of required funding

Farm-in

• Remains the preferred funding route• Ongoing process, multiple parties

engaged in due diligence

Other Alternatives

• Alternative financing options being considered; funding proposals received and under consideration

• Temporary issuance authority being sought at AGM to allow BPC to respond rapidly to funding options as they arise

Page 14

Considering multiple alternatives to fund drilling, whether by a farm-in on acceptable terms, or by other means, whichever is in the best interests of the Company.

♺

BPC Oil Capital Conference – September 2019 Page 15

A World-Class Prospect

ü Robust technical story – exploration well(s) to define potential multi-billion barrel oil field

ü Local oil producing analogues; oil in historic wells demonstrates working play systems

ü Past work (>US$100m) has defined the prospect inventory and dramatically constrained risk; extensive database, third-party CPRs, multiple prospects, on-trend potential

Advantaged Operations

ü Stable regime, long history of democracy, Full Commonwealth member, attractive fiscal terms; settled legal regime; government take commensurate with frontier exploration risk

ü Proximity to US assures project execution - oilfield services, contractors and suppliers, extensive / varied refining capacity, infrastructure and markets

ü Ensures robust, globally competitive exploration & development (F&D) metrics

Technical Progress ü Geophysical support for DHIs. Technical de-risking supports farm-in and location optimisation

ü Drilling Plan focused and augmented. Well objective focus

Clear Tenure ü Licences secured to end 2020 - exploration well required prior to then

ü Final permitting processes underway

Detailed Drill Plan, Key Services

& Team in place

ü Rig and essential support services secured from leading international providers

ü Deliverable drill plan with focused objective

ü Experienced, capable team in place to assure execution

Capital ü One well requires BPC to source US$25m-US$30m of funding; two wells c. $50m

ü Convertible note provides access to funding for approximately half initial well

ü Multiple alternative sources of finance being considered; farm-in process continues; improved market sentiment; global oil price recovery

1

Summary: A Clear Line of Sight to Drilling in 1H2020

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3

4

5

6


2019September AGM

2020Framework AgreementRig Provision

Mid – 2H2020Multiple Well DecisionAppraisal Upside

Drillingoutcome

SeadrillContract

mobilisationof rig

Buildup to

Drilling

A Compelling Value Opportunity7‘Giant’, Middle-East scale structures

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• Immediate short-term upside (3 - 6 months)ü Technical Services deliverablesü Environmental Permittingü People – Track Record, proven teamü Financing Options

• Farmin, ongoing interest - majors• Convertible• Other options being evaluated

• Medium-term upside (6 - 10 months)ü Strong news flow

• Rig mobilization• Multiple target horizons

ü Successful well outcome - discovery• Multiple billion barrel potential• Appraisal upside

• Longer-term upside (12 months +)ü Follow-on potential, huge running roomü Frontier E&P platformü Strategic expansion – leverage core skillsü Opportunities identified, track record,

proven team in place

Clearly defined milestones

oil capital conference: “progressing to drilling”...ü fiscal terms embodied in licence...

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