THE BAHAMAS:THE BAHAMAS:AN OIL PROVINCE AN OIL PROVINCE REDISCOVERED?REDISCOVERED?
Presented at Oil Barrel Conference Presented at Oil Barrel Conference 28 October 200928 October 2009
BPC LIMITEDBPC LIMITEDIsle of Man Office:IOMA HouseHope StreetDouglasTel: +44 1624 641199
Email: [email protected]: www.bpcltdgroup.com
Novus Capital Markets Ltd (Broker)
Charles Goodfellow
Tel: +44 (0) 20 7107 1872
Strand Hanson Limited (Nomad)
Rory Murphy / Liam Buswell
Tel: +44 (0) 20 7409 3494
Financial Dynamics (PR)
Billy Clegg / Ed Westropp
Tel: +44 (0) 207 831 3113
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BPC Limited BPC Limited -- Board of DirectorsBoard of Directors
Alan Burns: Chairman & Chief Executive OfficerAlan Burns has a 37 year career in the oil business as Managing Director or Chairman of successful oil exploration and development companies. He has been involved in 28 new oil and gas field discoveries and developments.
Dr Paul Crevello: Chief Operating OfficerDr Paul Crevello is a carbonate reservoir oilfield expert and has wide international experience in discovery of major oilfields. Paul also has considerable experience in Bahamas geological investigation.
Michael Proffitt: Non Executive directorMichael Proffitt is formerly an international banker with Barclays and a former resident of the Bahamas and well known in the Bahamian business world.
Dursley Stott O.B.E: Non Executive directorDursley Stott is a founder of a stockbroking firm and an experienced international businessman.
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BPC TeamBPC Team
3
Michael Proffitt
Isle of ManAlan Burns
Isle of Man
Dr Paul Crevello
USA
Idris Reid
Bahamas Manager
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DisclaimerDisclaimer
Some statements contained in this presentation or in documents referred to in it are or may be forward-looking statements. Actual results may differ from those expressed in such statements, depending on a variety of factors.
Past performance of the Company or its shares is not a guide to future performance.
Any forward-looking information contained in this presentation has been prepared on the basis of a number of assumptions which may prove to be incorrect, and accordingly, actual results may vary.
This presentation does not constitute, or form part of or contain any invitation or offer to any person to underwrite, subscribe for, otherwise acquire, or dispose of any shares in BPC Limited or advise persons to do so in any jurisdiction, nor shall it, or any part of it, form the basis of or be relied on in any connection with or act as an inducement to enter into any contract or commitment therefore. No reliance may be placed for any purpose whatsoever on the information or opinions contained in this document or on its completeness and no liability whatsoever is accepted for any loss howsoever arising from any use of this document or its contents otherwise in connection therewith.
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The story so farThe story so far
Admitted to AIM September 2008
Signed StatoilHydro Exploration Joint Venture mid 2009
Larger shareholder spread since mid 2009
Potential multiple giant leads identified by independent reports
Secure licences & excellent fiscal terms
World-class play systems adjacent to active oil producing provinces
Adjacent to world’s most extensive infrastructure
Petroleum systems with quality reservoirs, traps and seals
Seeking industry partners for exploration and evaluation
66
Bahamas Exclusive Economic Zone (EEZ) & Gulf of MexicoBahamas Exclusive Economic Zone (EEZ) & Gulf of Mexico
88
Map Showing Previous Petroleum Exploration Licences in Bahamas Territory from 1947-1988
Source: The Commonwealth of The Bahamas
All the above licences were abandoned prior to 1988
Tenneco were the final licence holders
99
Historical Oil & Gas Prices Historical Oil & Gas Prices -- Average Annual PriceAverage Annual Price
---- Oil – Nominal (US$/bbl) 1945-Present
Oil – Inflation Adjusted (US$/bbl) 1945-October 2009
Natural Gas (US$/MM BTU) U.S. Wellhead 1945-1994 & Nymex 1994-Present
Andros, #1 Cay Sal, #1 Long Island, #1 Great Isaac, #1 Doubloon Saxon, #1
Bahamas well timings
Andros, Cay Sal, Long Island, Great Isaac, Doubloon Saxon
1010
Max Case100% Structural Fill
bn bbl
Most Likely Case50% Structural Fill
bn bbl
Minimum Case33% Structural Fill
bn bbl
Manta Ray 1.447 0.543 0.049
Sand Shark 1.386 0.244 0.071
Blue Fin 3.469 0.406 0.069
Lion Fish 1.322 0.268 0.16
Blue Marlin 1.94 0.439 0.238
Grouper 6.492 1.665 0.837
Hammer Head 1.007 0.299 0.121
TOTAL for play in billion barrels
17.063 3.864 1.545
TennecoTenneco’’s Resource Potential of Leads Mapped in The Bahamas s Resource Potential of Leads Mapped in The Bahamas in 1987in 1987
1111
-10000
-7000
-7000
GREEN – 4-way isolated closure (COMBINED 33,581 ACRES)YELLOW - 4-way combined closure (COMBINED 122,441 ACRES)BLUE - 4-way & fault closure to spill (201,144 ACRES)Structure map on Lower Cretaceous
50 km
Tenneco 1985 Prospects Tenneco 1985 Prospects –– Potential Oil Fill Scenarios Potential Oil Fill Scenarios These areas are inside BPCThese areas are inside BPC’’s licencess licences
1212
Technology hindered deep water exploration in the pre and mid 1980’s
Drilling technology limited to less than 500 feet
- As a consequence, Tenneco was unable to drill the super giant features mapped in 500 - 2,000 feet water depth
Seismic acquisition technology was also a challenge in shallow water
- This led to poor placement of early wells
Discencentivised international exploration activity post 1985
Crash in oil and gas commodity prices from 1986 to 2003 led companies to remain in producing areas
Complete loss of all technical data in The Bahamas
No data room in The Bahamas, Bahamas Government geological data destroyed in major hurricanes in 1980’s
BPC initiates a global search for data
BPC is the only company to have a comprehensive data set and managed thorough evaluation of the exploration potential
Search and acquisition of original seismic data, well logs and chance finds of the original well cores took 4 years and cost over $4 million
Original well logs were analog and BPC have had them digitised and re-evaluated by Schlumberger and other parties using advanced computer programmes
Well cores were discovered by BPC by chance in an abandoned warehouse in New Orleans after Hurricane Katrina
Why The Bahamas saw Limited Activity until BPC personnel lodged Why The Bahamas saw Limited Activity until BPC personnel lodged Applications in 2005Applications in 2005
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Licence Agreement Signed by His Excellency Arthur D. Hanna, Licence Agreement Signed by His Excellency Arthur D. Hanna, GovernorGovernor--General of the Commonwealth of The BahamasGeneral of the Commonwealth of The Bahamas
13
1414
Location of BPC Licences in the Commonwealth of The Bahamas
Licences located both in shallow and ‘deep’ water
1616
Core Storage Facility, New Orleans, LA, USACore Storage Facility, New Orleans, LA, USA
Core Facility Flooded by Hurricane Katrina, August 29, 2005
Hunt for the almost Buried Treasures!
1717
Core Storage Facility Core Storage Facility -- Flooding limited to lower 4 feetFlooding limited to lower 4 feet
Core boxes washed off shelves Geologist discovers Bahamas cores in upper racks
1818
Core Storage FacilityCore Storage Facility
Dr. Richard Inden, carbonate geologist, examines Bahamas cores
19
BPC Data Room, Boulder CO, USA, BPC Data Room, Boulder CO, USA,
19
Calibrating Well Log Petrophysics Attributes with thin Section Porosity and Permeability
20
BPC Data Room, Boulder CO, USABPC Data Room, Boulder CO, USA
20
Evaluating Foldbelt Seismic Attributes with Gravity & MagnetEvaluating Foldbelt Seismic Attributes with Gravity & Magneticsics
2121
Retrieved 16,573’–Fractured BRECCIATED DOLOMITE
Darcy Permeability (not measured)
Core slow bleeding oil
Fluorescence petrography indicated migrated oil
Doubloon Saxon Whole Core Showing Vug/Fracture PorosityDoubloon Saxon Whole Core Showing Vug/Fracture Porosity
2222
Great Isaac 10,313’
1 mm 10343’
cm
Great Isaac Oolite Great Isaac Oolite –– Anhydrite Reservoir Anhydrite Reservoir –– Seal PairsSeal Pairs
OOID GRAINSTONE - PRESERVED INTERGRANULAR POROSITY & LEACHED OOID MOLDS
EXCELLENT RESERVOIR POROSITY & PERMEABILITY
ANHYDRITE – SEAL ROCK
2323
Generalised Well & Hydrocarbon Shows (Florida Generalised Well & Hydrocarbon Shows (Florida –– Bahamas Bahamas –– Cuba)Cuba)most are wells drilled on either no, or inadequate seismicmost are wells drilled on either no, or inadequate seismic
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BPC Major Assets
Skilled experienced people with established track record of stakeholder delivery
Quality petroleum licences in the Commonwealth of the Bahamas
Sole ownership of the complete geological and geographical data set, cores and cuttings of the Bahamas region
2525
Stratigraphic Chart of the Bahamas and Adjacent Areas
Depth to Interval Penetrated
South Florida LittleBahama Bank
Great Bahama BankCay Sal Bank NW CubaAge
Present Present Present Present
Cedar Keys
PineKey
(Chalk)UnknownFacies
Remedios
Purio Purio
RemediosCardSound
(Dolomite)
CardSound
(Dolimate)
MarquesasSupergroup
MarquesasSupergroup
MarquesasSupergroup
Palenque
MarquesasUnknown
SialicOceanicSialic
Unknown
PuntaAlegrePunta
Alegre
JaguaAzucarSan
Cayetano
AzucarSan
Cayetano
JaguaSmackover Equivalent
Jagua - HaynesvilleCotton ValleyEquivalent
Eocene&
Younger
Paleocene
MaastrichtianCampanian
Santonian
Coniacian
Turonian
Cenomanian
Albian
Aptian
Neocomian
Portlandian
Kimmeridg.to
OxfordianCallovian
toBajocian
Basement
Absent
DoubloonSaxon
Thrust
21,750’
Oil Shows
GreatIsaac
17,949’
OverpressuredGas Zone
CaySay #1
18,905’
F?
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BPC 2006 BPC 2006 –– 2009 Technical Projects2009 Technical Projects Retrieved and Described Original
Core and Cutting Samples
Modern Computer Workstation Analysis: Seismic, Well Logs, Gravity and Magnetics
Modern Petrophysics Well Log Analysis on Original Digital and Scanned Logs
Seismic and Borehole Structural Geologic Analysis
Risk Analysis, Cost Comparison and Reservoir Simulations
Geochemistry and Petroleum Systems Evaluation
22 leads confirmed
81º 80º 79º 78º 77º
81º 80º 79º 78º 77º
COOPER
DONALDSON
ENEAS
MIAMI
27º
26º
25º
24º
23º
22º
Grand Bahama
Andros Island
GreatAbacoIsland
Nassau
Miami
Fort Lauderdale
Freeport
LOCATION OF AWARDED LICENSESSHOWING PROSPECTS & LEADS
0 100 kms
D6AwardedPermits
Prospect and orlead
BAIN
Cayo Coco-2
C2
Great Isaac-1
F L O R I D A
C U B A
Cay Sal-1
B2C5
C6
E2
E1
B3
C4
C1
C3D1
D3 D2
D4D5 Doubloon Saxon-1
M1
Andros Is-1
D6
B1
M2M3
M4
C7
2727
2. Upper Cretaceous Platforms, Buildups &
Talus
3. Lower Cretaceous &Jurassic Evaporitic Platform Dolomites,
Buildups & Talus
1. Jurassic Paleo Highs, Clastics & Subsalt
4. Middle – Late Jurassic Rift & Sag Basins,
Evaporitic Dolomites& Reactivated Faults
5. Foreland Folds & Imbricate Thrusts
Schematic Geological Cross Section of the BahamasSchematic Geological Cross Section of the BahamasPlay Types & Potential Oil Field StylesPlay Types & Potential Oil Field Styles
2828
10 KM
SE NE
D5
Seismic Line across Tenneco Doubloon Saxon WellSeismic Line across Tenneco Doubloon Saxon Well
DS #1 penetrated imbricate thrust off structural crest
2929
Seismic Line across Southern Fold Belt to PlatformSeismic Line across Southern Fold Belt to Platform
> 0.5 sec closure in 5-10 km wide folds
3030
Royalty Rates, Leases terms:Production Level Royalty Rate
Oil Production, up to 75,000 bopd 12.5%
Oil Production, up to 75,000 to 150,000 bopd 15.0%
Oil Production, up to 150,000 to 250,000 bopd 17.5%
Oil Production, up to 250,000 to 350,000 bopd 20.0%
Oil Production, in excess of 350,000 bopd 25.0%
Gas Production 12.5%
There are no corporate income taxes in The Bahamas. Rentals, at the rate of $0.92 per acre per annum, are charged for the area of a lease, but these are deductible from Royalty payments.
Comparison of Licencee Revenues Comparison of Licencee Revenues –– GOM GOM vs. Bahamasvs. Bahamas
The increased potential return to the The increased potential return to the licence holder in the Bahamas is largely licence holder in the Bahamas is largely due to zero corporate income taxdue to zero corporate income tax
Commercial and Fiscal Terms Commercial and Fiscal Terms of The Bahamas for oil and gas productionof The Bahamas for oil and gas production
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BPC Corporate StructureShares on issueShares on issue 789,639,838789,639,838
Current share priceCurrent share price 4.30p4.30p
Market CapitalisationMarket Capitalisation ££35M35M
Cash on hand*Cash on hand* $3,004,997$3,004,997
Unlisted optionsUnlisted options 7,896,398*7,896,398*
Top 40 holdTop 40 hold ~97%~97%
Top 20 holdTop 20 hold ~94%~94%
InstitutionsInstitutions ~69%~69%
UKUK ~86.77%~86.77%
OverseasOverseas ~13.23%~13.23%
*Figures at 31 December 2008
Directors & Management
Founder Shareholders and Institutions
Other
*Held by Ambrian – Former Nomad
Exercise Price 4.25p expiry August 2011
3232
BPC Shareholder List BPC Shareholder List –– Holdings above 3%Holdings above 3%
Shareholder Shareholding Stake held in total issued share capital of
the Company (%)RAB Special Situations 156,461,650 19.81
Gartmore 76,180,000 9.65
Legal & General 75,500,000 9.56
Mark Stuart Savage 53,310,006 6.75
A.R. Burns 44,820,000 5.68
Petroleum Geoscience International LLC/PetrexAsia Consulting – Paul Crevello
33,030,000 4.18
Blackrock 32,000,000 4.05
3333
BPC Share Price Performance: Sept 2008 BPC Share Price Performance: Sept 2008 –– Oct 2009Oct 2009
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News Release: StatoilHydro to acquire Bahamas crude oil terminalNorway Post 26 October 2009
StatoilHydro has signed an agreement with World Point Terminals Inc to buy the South Riding Point crude oil storage and transhipment terminal located on Grand Bahama Island in the Bahamas.
StatoilHydro has signed a stock purchase agreement to buy the terminal from the Canadian public company World Point Terminals Inc.
The acquisition of South Riding Point terminal includes the crude oil storage and transhipment facility and World Point’s 50% interest in the Freepoint Tug and Towing Service tug boat business, both located on Grand Bahama Island. The terminal is located on property leased from a corporation controlled by the government of the Bahamas.
The purchase price is USD 263.2 million, equivalent to about NOK 1.7 billion.
“The acquisition is a strategic move which supports StatoilHydro’s global growth ambition. It will strengthen StatoilHydro’s marketing and trading position in North America by securing the full terminal capacity," says Jon A Jacobsen, executive vice president for Manufacturing & Marketing.
“StatoilHydro’s objective is to upgrade the terminal to allow for blending of all types of crude oils, including heavy oils," he continues.
StatoilHydro has leased storage capacity at the terminal since 1993. All 55 of the current employees at the terminal will be asked to remain in their current jobs and will be offered permanent positions with StatoilHydro.
South Riding Point is a full member of the Clean Caribbean America (CCA) cooperative. CCA is a clean seas organisation covering the Caribbean and provides equipment and expertise to its member companies to assist in managing waterborne pollution incidents, should they occur. In addition, South Riding Point has its own oil spill response equipment and expertise located on site and at the terminal.
StatoilHydro anticipates receiving all required governmental approvals during the 3rd quarter of 2009 and closing the transaction prior at year-end 2009.
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News Release: BPC Limited and StatoilHydro to Reopen Bahamian Energy Exploration with Offshore Joint Venture
18 May 2009, 08.01
Venture Marks First Major Bahamian Exploration Project in 22 YearsPERTH, Australia-- Energy exploration company, BPC Limited (THE COMPANY: (AIM: ‘BPC’) today announced a new offshore joint venture with Norway’s StatoilHydro (OSE: ‘STL’, NYSE: ‘SO’) to launch the first major exploration project in Bahamian waters since 1986.
A competent persons report, published last year, stated that there could be multiple 500 MMBOE oil fields in 18 leads recognized in BPC’s southern Bahamas licenced area (source: Competent Person’s Report by Moyes & Co., Inc. contained in BPC’s AIM admission document, August 2008). The CPR evaluated BPC’s licenced area adjacent to and along trend of the ‘JV’ area.
Additionally, a U.S. Geological Survey (2008; Report DDS–69-M) study of the offshore northwest Cuba Basin estimates a potential of 7-14 billion barrels equivalent (oil and gas) of undiscovered resources.
Exploration Vice President Erik Finnstrom, StatoilHydro states “This joint venture strengthens StatoilHydro's position in this attractive exploration region of the northern Caribbean.”
Joint Agreement with StatoilHydro
The licences included in this joint venture agreement with StatoilHydro (“Joint Agreement”or “JV”) are new licence areas for BPC in the south west of The Bahamas and are still under application pending the approval of the Government of the Commonwealth of the Bahamas. The “JV” area is adjacent to four wholly owned licenses held by BPC in The Bahamas, as well as near an existing license held by StatoilHydro in adjacent Cuban waters.
The “JV” Agreement is conditional on the relevant new licences being awarded to BPC and assignment with StatoilHydro. It is hoped the applications will be processed before the end of 2009. The last active exploration in the Bahamas was in 1987 by Tenneco, whereas along trend in offshore Cuba the same petroleum system is the focus of current exploration activity.
Cont…
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Cont…BPC’s Chairman, Alan Burns said:
“We are delighted to partner with a respected industry leader like StatoilHydro. It is testament to the prospects of the southern Bahamas and to BPC’s contacts and commitment to the region that a large business such as StatoilHydro sees it as an important addition to their exploration portfolio. The terms of this agreement will strengthen BPC’s capital position and eliminate the need for near-term fresh capital funding for the ‘JV’. Both companies are committed to preservation of the environment during all phases of exploration and development.
StatoilHydro is an integrated technology-based, international energy company, primarily focused on upstream oil and gas operations. The Norwegian headquartered StatoilHydro, is listed on both the New York Stock Exchange and Norway’s Oslo exchange.”
Enquiries:
BPC LimitedAlan Burns, Chairman and Chief Executive Tel: + 61 407 551 001Dr Paul Crevello, Chief Operating Officer Tel: +1 720 771 7583
Strand Hanson - Nominated Adviser Tel: +44 20 7634 7405Rory Murphy/Liam Buswell
Financial Dynamics – PR, London Tel: +44 20 7831 3113Billy Clegg/Ed Westropp
Fox-Davies Capital – broker Tel: +44 20 7936 5220Daniel Fox-Davies/Oliver Stansfield
Belaga/McGrath – PR, USA Tel: +1 713 660 0982Jim McGrath/Chris Belaga
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BPC believes there are supergiant oilfields to be found in Bahamas waters and is working with
partners to find them
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Thank you for attending – may your Christmas be full of Christmas Trees
Cerro Azul #4 was a reef complex similar to the buried reefs of the Bahamas
Mexico's Cerro Azul No. 4 was hailed as the the world's greatest oil well in 1908, making Mexico 2nd only to the United States in production
This wild blowout rained oil 600 feet high and drenched the area with oil for 2 miles around
Over 1 million bbls flowed in the first week before being harnessed
It remains as the worlds’ most prolific oil well
Golden Lane Mexico