october 2009 corporate presentationcorporate presentation disclaimer no representation or warranty,...

October 2009

Corporate Presentation

DisclaimerNo representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness ofthe information or opinions contained in this presentation Such information and opinions are in all events not current after the date of this presentation Certainthe information or opinions contained in this presentation. Such information and opinions are in all events not current after the date of this presentation. Certainstatements made in this presentation may not be based on historical information or facts and may be "forward looking statements" based on the currently heldbeliefs and assumptions of the management of Aban Offshore Limited (the “Company”), which are expressed in good faith and in their opinion reasonable,including those relating to the Company’s general business plans and strategy, its future financial condition and growth prospects and future developments in itsindustry and its competitive and regulatory environment.

F d l ki t t t i l k d k i k t i ti d th f t hi h th t l lt fi i l ditiForward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, financial condition,performance or achievements of the Company or industry results to differ materially from the results, financial condition, performance or achievementsexpressed or implied by such forward-looking statements, including future changes or developments in the Company’s business, its competitive environment andpolitical, economic, legal and social conditions. Further, past performance is not necessarily indicative of future results. Given these risks, uncertainties and otherfactors, viewers of this presentation are cautioned not to place undue reliance on these forward-looking statements. The Company disclaims any obligation toupdate these forward-looking statements to reflect future events or developments.

This presentation is for general information purposes only, without regard to any specific objectives, financial situations or informational needs of any particularperson. This presentation does not constitute an offer or invitation to purchase or subscribe for any securities of the Company by any person in any jurisdiction,including India and the United States. No part of it should form the basis of or be relied upon in connection with any investment decision or any contract orcommitment to purchase or subscribe for any securities. The Company may alter, modify or otherwise change in any manner the content of this presentation,without obligation to notify any person of such change or changes. This presentation may not be copied or disseminated in any manner.

2

Promoted by Mr M A Abraham in 1986 a first generation entrepreneur and has transformed into the

Aban Offshore Limited – Key Highlights

Among the 10 largest offshore drilling service providers in the world based on number of rigs (1)

Promoted by Mr. M.A.Abraham in 1986, a first generation entrepreneur and has transformed into the largest Indian private offshore drilling company in India

Operating in a recovering industry environment; Improved outlook for oil prices and drilling capex

Young and technically superior fleet from reputed yards; 45% of the fleet is less than 4 years old and most of the other rigs have undergone refurbishment in the last 3‐4 years

Long term contracts at attractive rates; diverse client base comprising domestic and international oil and gas companies

Highly experienced management and operating team

Impressive historical revenue growth with higher EBITDA margin amongst certain operators; Strong order backlog of US$ 2 372 million as on September 30 2009

3

backlog of US$ 2,372 million as on September 30, 2009

(1) Source: ODS‐Petrodata Offshore Rig Monthly August 2009 and Company information.

Creating Value Through Continuous Growth

2005

2009 Took delivery of 4 new vessels (Deep Drill 6,7,82005

2 jack‐up rigs (Aban V and Aban VI) and 1 drill ship (Aban Ice) added to portfolio

Launched Aban Singapore Pte Ltd. (ASPL) as a vehicle for international operations

Took delivery of 4 new vessels (Deep Drill 6,7,8 and Aban VIII) in FY08‐09

Fleet of 19 offshore drilling rigs and 1 FPU placing AOL among the leading offshore drilling asset owners in the world

2009for international operations

Placed order for a new premium jack‐up rig Aban VIII

20071994 Investment in renewable

2006

2007

1992A i d 300 ft j k

2006 Purchased Aban Abraham

Acquired 40% in Norway based Sinvest for US$2

Completed 100% acquisition of Sinvest

Aban Pearl added to portfolio

energy (wind)

Current capacity of 68.5 MW 2005

2001

1986 Aban Offshore Limited (“AOL”) t bli h d

Acquired a 300‐ft. jack‐up rig from Mahindra & Mahindra

$billion

Portfolio of 3 jack‐ups rigs (Deep Drill 1, 2, 3), 5 jack‐up rigs on order and a 50% interest in a drill ship Deep Venture

2001 Acquired Hitech Drilling Services, a Tata Group Company; portfolio of 4 rigs

1992

1994

(“AOL”) established

1987 Launch of contract drilling

Enables AOL to enter the FPSO(1)

business with the FPU ‘Tahara’ owned by Hitech

1986

1987

4

services; contract with ONGC for 2 jack‐up drilling rigs

(1) FPSO – Floating production, storage and offloading.

Estimated Global Offshore Spend (1)

Recovery in Oil Prices Resulting in Higher Capex OutlookOil Prices – Forward Curve (2)

7075808590

Europe / FS U21%

As ia‐Pac ific23%

Europe / FSU18%

Asia‐Pacific22%

US $48

US $53 US $55Estimated Global Offshore Drilling Expenditure (1)

US$266 US$275

6570

Nov-09 Nov-10 Nov-11 Nov-12 Nov-13 Nov-14 Nov-15 Nov-16 Dec-17A fric a / Middle Eas t

28%

Americ as28%

Africa / Middle East

31%Americas

29%

US $43

US$239

US$253

S$

bn

US

$ bn

2008E 2009E 2010E 2011E

Worldwide E&P expenditure is expected to continue in the near future to ~US$375 billion in 2011

2008E 2009E 2010E 2011E

US

Impact of Slowdown Outlookfuture to US$375 billion in 2011

– Growth in global offshore spend expected to be in line with E&P expenditure at US$275 billion in 2011

– A significant amount of this spending will be specifically on drilling rigs

Reduction in Rig hire activity

Decline in rig rates

Scrapping of fresh rig

Strong demand for deep water rigs

Strong demand in emerging economies like

5

pp g gbuilding programmes

emerging economies like Mexico, West Africa etc.

(1) Source: ODS‐Petrodata and Industry Research(2) Source: Bloomberg

Improved Outlook for Drilling Services in Past Six monthsHistorical Supply & Demand

Jack ups Semi submersibles Total

Over 50 new offshore drilling assets are

expected to be globally supplied over

the next 15‐18 months, adding ~10% to

the current global fleet Although this

Jack-ups Semi-submersibles TotalAug-09 Jul-09 Aug-08 Aug-09 Jul-09 Aug-08 Aug-09 Jul-09 Aug-08

North America 20 18 61 27 29 30 54 53 101North Sea 31 32 32 36 38 39 69 72 72Africa 15 15 25 20 19 23 45 45 56Latin America 49 51 47 43 42 37 104 105 95SE Asia/Australia 39 38 51 17 20 19 59 61 72 the current global fleet. Although this

additional supply is also expected to

replace part of the old rig fleet

Far East/India 61 62 49 6 7 8 76 77 65Middle East 72 69 82 2 1 1 74 70 83Mediterranean 23 25 28 6 7 5 31 33 34FSU/Eastern Europe 10 10 12 3 3 3 13 13 15Total 320 320 387 160 166 165 525 529 593Rig Supply 450 448 427 183 184 173 685 682 647W ld id Utili ti % 71 71 91 87 90 95 77 78 92

91.7%

95.7%Average Day Rates for International Jackups showing signs of improvement

Source: Industry Research

Worldwide Utilization % 71 71 91 87 90 95 77 78 92

Improving Utilisation Rates in certain regions

66.7% 66.9% 68.4%71.2% 70.4%

86.7%

67.8%

74.1%76.9%

64.2%

68.4%66.7%

64.2%

84.0%

signs of improvement

$100

$150

$200

$250

Af rica Eastern Europe North America Mediterranean Middle East SE Asia North Sea Far East Asia

1 Month Ago Current

$0

$50

$100

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

SE Asia West Af rica ME

6

Source: RigZone.comSource: Industry Research

Aban owns and operates a young fleet with 9 new rigs built in 2006 or later; The fleet comprises 15 Offshore Jack‐up Rigs, an FPSO 3 D ill hi d FPU

AOL’s Fleet Located in Strategic Geographical locations

FPSO, 3 Drill ships and an FPU.

RIG: Aban IILocation: IndiaSpecs: 250’ ISAge: 28 / 2

RIG Ab III

RIG: Aban VILocation: Middle EastSpecs: 250’ ICAge: 34 / 7

RIG Ab VII

RIG: Deep Driller 2Location: Middle EastSpecs: 350’ ICAge: 3 / ‐



RIG: Aban VIIILocation: Middle EastSpecs: 375’ ICAge: 1 / ‐

RIG: Aban IIILocation: IndiaSpecs: 300’ ICAge: 35 / 6

RIG: Aban IVLocation: IndiaSpecs: 300’ ICAge: 26 / 10

RIG: Aban VIILocation: Under MarketingSpecs: 250’ ICAge: 36 / 3

RIG: Deep Driller 1Location: Under MarketingSpecs: 375’ ICAge: 3 / Age: 26 / 10

RIG: Aban VLocation: IndiaSpecs: 300’ ICAge: 27 / 7

Age: 3 / ‐

RIG: Deep Driller 8Location: India

RIG: Deep Driller 6Location: Under MarketingSpecs: 350’ ICAge: 1 / ‐

RIG: Deep Driller 7Location: Mexico

RIG: Aban IceLocation: IndiaSpecs: 1,000’ DSAge: 34 / 0

Specs: 350’ ICAge: 0 / ‐

RIG Ab Ab h

RIG: Aban PearlLocation: VenezuelaSpecs: 1,250’ SSAge: 32 / 0

Specs: 375’ ICAge: 1 / ‐

RIG: Deep Driller 3

OperationalNot OperationalFPSOJackup RigDrill Ship

RIG: Aban AbrahamLocation: West AfricaSpecs: 6,600’ DSAge: 33 / 0

RIG: Deep VentureLocation: West AfricaSpecs: 4,200’ DSAge: 28 / 2

RIG: TaharaLocation: IndiaSpecs: FPUAge: 36 / 12

RIG: Deep Driller 3Location: MalaysiaSpecs: 350’ ICAge: 3 / ‐

7

Source: Company

Age: Number of years from manufacture date / Number of years from last refurbishment date

Age: 28 / 2 g /

Long term contracts resulting in stable cash flow for near future.

Long‐term contracts

2009 2010 2011 2012 2013 2014Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Drillship - Aban Abraham $325

Drillship - Aban Ice $123

$Drillship - Deep Venture $525

FPU - TAHARA $49

Jack-up - Aban II $74

Jack-up - Aban III $157

Jack-up - Aban IV $157p

Jack-up - Aban V $157

Jack-up - Aban VI $83

Jack-up - Aban VII Under Marketing

Jack-up - Aban VIII $170

Under MarketingJack-up - Deep Driller 1 Under Marketing

Jack-up - Deep Driller 2 $177




Jack-up - Deep Driller 6 Under Marketing



Semi-sub Aban Pearl $358

8

Note: The figures at the end of each bar represent the per day US$ ‘000 rate at which these rigs are contracted

Senior Management Designation

Strong Management & Operating TeamKey Operating Personnel

Designation

Mr. V. S. Rao Chairman• Experience: Over 42 years in the industry. A member of the

board since 1991, was designated as Chairman of the Board in 2005

Mr. A. P. S. SandhuChief Operating Officer

• Qualifications: Graduate in Engineering

• Experience: Over 30 years in drilling and oil field services. Prior to Aban he was working with ONGC

Mr. Larry Albert Noel Austin

Operations Manager

• Qualifications: Graduate in Electrical Engineering (Norther Alberta Institute , Canada)

• Experience: Over 30 years in the drilling industry. Prior to Aban he

Mr. P. Murari Vice Chairman• Experience: Senior positions in the Government of India

and Government of the State of Tamil Nadu. He has been a member of the Board since 1996

Managing

• Qualifications: Graduate in Engineering and a post graduate in Management Studies

AustinJackups

p y g yhas worked with Global Santa Fe, Seadrill, Dixilynn, Smedvig, Tera Nova & Texaco Global

Mr.S. SrinivasanVice President Corporate Planning

• Qualifications: Graduate in Chemical Engineering (Indian Institute of Technology Chennai) and a Management graduate (Indian Institute of Management, Calcutta)

• Experience: Over 18 years in corporate finance, project financing and equity markets Prior to Aban he was working with ICICI Bank

Mr. Reji AbrahamManaging Director

• Experience: Over 16 years of experience in the Industry. Joined the Board in 1994 and was appointed as a whole‐time director in 1997 and promoted to Managing Director in 2004

Mr. Satish Chandra Gupta

Director

• Qualifications: Post graduate in Commerce

• Experience: Over 35 years in all the areas of banking. Prior to Aban, he was the head Punjab National Bank

and equity markets. Prior to Aban he was working with ICICI Bank

Mr. V. Ramasubramanian

General manager Business Development

• Qualifications: Graduate in Technology in Mechanical Engineering, post graduate in Diploma Management

• Experience: Over 18 years in business development, marketing and operations in engineering industry. Prior to Aban he was working with ArcelorMittal

• Qualifications: Graduate in Business Administration (Royal j

Mr. K. Bharathan Director

• Qualifications: Chartered Accountant

• Experience: Over 32 years in commercial and development banking and insurance

Mr. K. M. Jaya RaoNominee Director ICICI Bank Ltd

• Qualifications: Graduate in Engineering

• Experience: Over 27 years in banking

Mr. Adrian GreyQC HSE Manager

Military College UK)

• Experience: Over 37 years in the drilling industry in the filed of compliance, quality, health and safety. Prior to Aban, he has worked with companies like IADC, Transocean, Amoco

Mr. Vijay SahetaGeneral Manager Finance


• Experience: Over 19 years in accounts, taxation, insurance and

Mr. P. Venkateswaran

Deputy Managing Director

• Qualifications: Graduate in Engineering (Indian Institute of Technology, Madras)

• Experience: Over 34 years in operations. He was appointed as Deputy Managing Director in 2007

Mr C PDeputy Managing

• Qualifications: Chartered Accountant and a graduate in Law

Finance finance

Mr. Narayanan Venkatramanan

General Manger Finance


• Experience: Over 20 years in accounts, taxation and finance

Mr. Alun RobertsOperations Manager Floaters

• Experience: Over 40 years in the drilling industry. Prior to Aban he has worked with companies like Global Santa Fe, Transocean, Robertson Research and IDC

9

Mr. C.P. Gopalkrishnan

Managing Director & Secretary

• Experience: Over 28 years in finance. He was Appointed as Deputy Managing Director in 2007 and is an associate of Company Secretaries of India

AOL – Strategy For Future

Deleverage and strengthen our balance sheet

Focus on cash flow generation by increasing

our balance sheetutilisation levels

Pursue strategic growth opportunities in theF i k t growth opportunities in the

longer termFocusing on new markets

Continue to focus on health, safety and

environment standards

10

environment standards

Overview of Financial Performance

FY2009

Sharp decline in oil prices from high of US$147 / barrel to low of US$35 / barrel

Increase in drilling activity

Improvement in contract day rates

FY2010 Outlook

Lack of funds for onward investment in E&P sector

Reduction in rig leasing activity and impact on t

Improvement in contract day rates

Global demand expected to rebound by ~7% in 2010 (largely led by non OPECD countries)

Industry Events

rates

Fleet Status 4 new builds delivered

Aban Abraham upgradation project

Aban Ice refurbishment completed and contracted for 3 years

completed

5 year contract for Aban Pearl

2 new builds placed on long term contracts

Long term contracts for 4 new builds

AOL Progress

contracts

Revenue Growth

49% revenue growth over FY08 6 % growth over Q1 2009

Debt refinancing resulting in debt maturities for

11

g glonger term of upto 10 years

Source: Annual Report

Debt Repayment Schedule Debt Profile (1)

Improved Debt Outlook

US$ mn 2010 2011 2012 2013 2014 2015–2019

Loan / Bond Amortisations

184 215 276 365 326 1,107

p y

Notes and Bond

Total Debt of: INR 166 bn / ~US$3,279 (1) mn

Loan / Bond Bullet Repayments

226 160 374 – – 46

Total Repayments 410 375 650 365 326 1,153

Rupee Loans16.8%

F i

Notes and Bond Loans24.7%

Foreign Currency Term

Loan58.5% Key Highlights

Debt repayment relatively spread out over 10 years with no large

Loan Description US$ mn

Rupee Loans 551

Foreign Currency Term Loan 1,917

Debt repayment relatively spread‐out over 10 years with no large repayments falling due in any year

Bank loans (rupee as well as foreign currency) largely from Indian banks, who have been supportive of the Company’s growth

g y

Notes and Bonds Loans 811

Total 3,279

12

(1) Debt as of March 31, 2009(2) FX Rate INR / US$: 50.73 (March 31, 2009)

EBITDA Margin (2)Fleet size (1) PAT Margin (2)

Benchmarking with Peers

47

57

136

Di d

Noble

Transocean

62.1%

65.1%

Diamond

Ensco

37.0%

47.0%

Diamond

Ensco

31

41

46

47

Hercules

Pride

Ensco

Diamond

56.2%

56.8%

Transocean

Aban

33.2%

37.0%

36.9%

Transocean

Pride

Diamond

20

22

23

31

Aban

Row an

COSL

Hercules

45.5%

48.3%

Pride

Scorpion

15.7%

25.0%

Aban

COSL

16

16

18

Maersk Drilling

Nabors

Seadrill

41.9%

44.1%

Seadrill

COSL10.0%

-7.8% Seadrill

Nabors

10

11

11

ONGC

National Drilling

Saipem

34.9%

35.9%

Nabors

Hercules

-96.3%

-12.9%

Hercules

Scorpion

13

(1) Source: ODS‐Petrodata Offshore Rig Monthly August 2009 and Company information(2) EBITDA and PAT margins for the last financial year ended from company annual reports

EBITDA and EBITDA Margin (1)Revenue (1)

Historical Growth Overview

EBITDA and EBITDA Margin ( )Revenue

17,32752.4%

56.8%15,000

20,000

30,501

30,000

40,000

3,474

10,72548.3%

0

5,000

10,000

7,187

20,470

0

10,000

20,000

Operating Cash Flow (3)Profit After Tax (2)

FY07 FY08 FY09EBITDA (INR in Million) EBITDA Margin (%)

0FY07 FY08 FY09

Revenue (INR in Million)

8,341

21,077

8,000

16,000

24,000

5,407

15.7%

5.8%2 000

3,000

4,000

5,000

6,000

3,190

0

,

FY07 FY08 FY09Operating Cash Flow (INR in Million)

1,230

(140)

(1.7)%

(1,000)

0

1,000

2,000

FY07 FY08 FY09PAT (INR in Million) PAT Margin (%)

14

PAT (INR in Million) PAT Margin (%)

(1) Excludes Other Income of INR 4,043 mm (FY 09), 880 mm (FY 08) and 881 mm (FY 07)(2) Represents profits after tax and minority interest (including other income). PAT margin computed on revenues (including other income)(3) Represents net cash from operating activities (post taxes and working capital changes)

Net Debt to EBITDADebt to Equity (1,2)

Leverage and Returns Profile

Net Debt to EBITDADebt to Equity ( , )

20x

25x

ity 20

25

30

BITD

A

20.4x16.1x

9.5x

0x

5x

10x

15x

Deb

t / Eq

u

27.4

11.6 9.3

0

5

10

15

Net

Deb

t / E

B

0FY07 FY08 FY09 FY07 FY08 FY09

Return on Capital Employed (ROCE) (4,5)Return on Net Worth (RONW) (3,5)

17,440

31.0%

15.1%

6 000

12,000

18,000

t in

INR

Mill

ion

13%

21%

29%

138 553183,795

8.4%

2 7%

6.1%

100,000

150,000

200,000

t in

INR

Mill

ion

4.00%

6.00%

8.00%

10.00%

5,3088,119

-2.6%0

6,000

FY07 FY08 FY09

Am

ount

-3%

5%

Equity RONW

138,553

113,834

2.7%

0

50,000

FY07 FY08 FY09

Am

ount

0.00%

2.00%

Capital Employed ROCE

15

(1) Equity represents Share Capital and Reserve and Surplus(2) Debt Includes Secured and Unsecured Loans(3) Return on Net Worth = PAT / Equity(4) Return on Capital employed = EBIT / (Equity + Loan Funds)(5) All figures are for financial year end

Appendix

Water Depth / Drilling Depth Year Built (Last Refurbished) Location / Geography

Rate ('000 USD) Contract End

Portfolio Overview

Drillship – Aban Abraham 6,600 / 25,000 1976 (2009) West Africa $325 Jun‐10

Drillship – Aban Ice 1,000 / 20,000 1975 (2009) India $123 (1) Sep‐12

Drillship – Deep Venture (2) 4,200 / 20,000 1981 (2007) West Africa $525 Feb‐11

FPU – TAHARA 800 / NA 1973 (1997) India $49 Oct‐10

Jack‐up – Aban II 250 / 20,000 1981(2007) India $74 (1) May‐10

Jack‐up – Aban III 300 / 20,000 1974 (2003) India $157 Apr‐11

Jack‐up – Aban IV 300 / 25,000 1983 (1999) India $157 Jan‐11

Jack‐up – Aban V 300 / 25,000 1982 (2002) India $157 May‐11

Jack‐up – Aban VI 250 / 20,000 1975 (2002) Middle East $83 (3) Jan‐14

Jack‐up – Aban VII 250 / 20,000 1973 (2006) ‐‐ ‐‐ Under Marketing

Jack‐up – Aban VIII 375 / 30,000 2008 Middle East $170 Jun‐12

Jack‐up – Deep Driller 1 375 / 30,000 2006 ‐‐ ‐‐ Under Marketing

Jack‐up – Deep Driller 2 350 / 35,000 2006 Middle East $177 Oct‐12

Jack‐up – Deep Driller 3 350 / 35,000 2006 Malaysia $165 Oct‐12

Jack‐up – Deep Driller 4 375 / 30,000 2007 Middle East $177 Oct‐12

Jack‐up – Deep Driller 5 350 / 35,000 2007 Middle East $177 Sep‐12

Jack‐up – Deep Driller 6 350 / 35,000 2008 ‐‐ ‐‐ Under Marketing

Jack‐up – Deep Driller 7 375 / 30,000 2008 Mexico $106 Nov‐11

Jack‐up – Deep Driller 8 350 / 35,000 2009 India $156 Dec‐09

Semi‐sub Aban Pearl 1,250 / 25,000 1977 (2009) Venezuela $358 Oct‐14

17

(1) Operating day rate in INR converted to US$ at an exchange rate of 50.73 (March 31, 2009)(2) Chartered by Venture Drilling AS(3) Operating day rate in EUR converted to US$ at an exchange rate of 1.325 (March 31, 2009)

Group Structure

Ab Off h Ltd (1) India

SingaporeNorway

Aban Offshore Ltd. (1)Aban II,III,IV,V,VI, Aban Ice , Tahara

Aban Holdings Pte Ltd

100%

Aban Singapore Pte Ltd

Aban International Norway ASAban Abraham Pte Ltd

100%

Aban 7 Pte Ltd

100%

Aban 8 Pte Ltd

100%100%

Aban Pearl Pte Ltd

100%

100%

Sinvest AS

Aban Abraham Pte Ltd. Aban 7 Pte Ltd. Aban 8 Pte Ltd.

60%

100%

40%

50%

Aban Pearl Pte Ltd.

Aban VIII Aban PearlAban VIIAban Abraham

DDI Holding AS

Deep Drilling Invest Pte Ltd

100%

Venture Drilling AS

50%

100%

Deep Drilling 1 Pte Ltd

100%

Deep Drilling2 Pte Ltd

100%


100%


100%


100%


100%


100%


100%

18Note: Text underlined are rig owning companies

Deep Drill 2 Deep Drill 3 Deep Drill 5 Deep Drill 6 Deep Drill 8Deep Drill 1 Deep Drill 4 Deep Drill 7

Thank You

october 2009 corporate presentationcorporate presentation disclaimer no representation or warranty,...

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