peters & co. presentation- sep16-10 · resource disclosure -the independent resource estimates...
TRANSCRIPT
Peters & Co Limited
2010 North AmericanOil & Gas Conference
September 2010
Billion Barrel Resource Potential
Offshore Guyana
2
Forward Looking Statements & Resource Disclosure
Forward Looking Statements - This presentation contains certain forward-looking statements. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding potential exploration results, hydrocarbons, resources and reserves, drilling plans, and the future plans and objectives of CGX Energy Inc. (“CGX”) are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. With respect to forward-looking statements contained in this presentation, CGX has made assumptions regarding, among other things: commodity prices and royalty regimes; availability of skilled labour; timing and amount of capital expenditures; future exchange rates; the price of petroleum; the impact of increasing competition; conditions in general economic and financial markets; access to capital; availability of drilling and related equipment; effects of regulation by governmental agencies; royalty rates and future operating costs. Important factors that could cause actual results to differ materially from CGX's expectations are disclosed elsewhere in documents that are available to the public at www.sedar.com, including under “Risk Factors” in CGX’s prospectus with respect to the offering described herein.
Resource Disclosure - The independent resource estimates with respect to CGX's Corentyne PPL have been prepared by Gustavson Associates LLC in accordance with NI 51-101 in a report dated March 3, 2010 with an effective date as of February 1, 2010. Prospective resources are those quantities of oil and gas estimated to be potentially recoverable from undiscovered accumulations. If discovered, there is no certainty that it will be commercially viable to produce any portion of the prospective resources. However, there is no certainty that the prospective resources will be discovered. For further information about the prospective resource estimates contained herein see CGX's annual information form dated May 7, 2010 which is available to the public at www.sedar.com. Certain information contained herein is considered "analogous information" as defined NI 51-101 such as the estimate of original oil in place with respect to the Tambaredjo and Calcutta fields onshore in Suriname. Such analogous information has not been prepared in accordance with NI 51-101 and the Canadian Oil and Gas Evaluation Handbook and CGX is unable to confirm whether such estimates have been prepared by a qualified reserves evaluator. The information has been provided to show that the Guyana Suriname basin in which CGX has an interest has a proven hydrocarbon system.
3
Executive Summary
CGX Drilling in Highly Prospective Basin with Proven Hydrocarbon System• Committed to two wells in next 12 months
• $27 mm working capital; pursuing JV partners
CGX Testing Multi-Billion Barrel Potential• Corentyne/Eagle – Independent Resource Assessment
0.3 billion barrels in Eocene
1.3 billion barrels in Upper Turonian1.2 billion barrels in Lower Turonian
• Georgetown/Jaguar – Tullow resource estimate0.7 billion boe in Upper Turonian
• CGX has 16 prospects and leads, including Albian
Exploration of Emerging Equatorial Atlantic Margin Play• West African – Turonian and Campanian discoveries from Ghana to Sierra Leone • Brazil – OGX’s shelf margin Albian/Aptian carbonate discoveries
• Guyana/Suriname Basin – six wells to be drilled in next 12 months• CGX surrounded by major companies
Exxon, Total, Shell, Tullow, Repsol, Murphy, Noble, Inpex, YPF
4
Six Wells Testing Basin Six Wells Testing Basin Starting Q4 2010Starting Q4 2010
5
Light oil at Abary well typed to biodegraded oil onshore Suriname
Proven Hydrocarbon System Proven Hydrocarbon System
6
CGX Drilling Two Wells in 2011(7.8 mm acres gross; 6.2 mm net)
Georgetown Jaguar 25% WI(Repsol 15%, YPF 30%, Tullow 30%)• Turonian Prospect
Spud H1 2011TD 6,500 metresCost ~ US$80 million
1 billion barrel potential
Corentyne Eagle 100% WI • Eocene Prospect
Spud 2011
TD 3,500 metresCost ~ US$35 million300 million barrel potential
7
Depositional Model for Turonian
Berbice Canyon
• 25 km across
• 1.3 km deep
Turonian Prospect Dimensions
• Areal extent ~ 200 sq km
• Thickness ~ 400 m
Richards, Bating, Bowman, 1998
8
Corentyne Incised Valley Funnels Sands on to Slope (Turonian/Campanian)
Eagle LocationA B
9
Jaguar Well to Test Turonian TrendEagle Well to Test Eocene Trend
Primary Prospects (3D Mapping)
• Turonian Basin Floor Fan
Jubilee Analogy
• Eocene Turbidites
Leads
• Maastrichtian Sand
Abary Blowout
• Campanian Turbidite
Venus Analogy
• Albian/Aptian Carbonate
OGX Analogy Brazil
Period Age
10Source: Gustavson Associates March 2010
Corentyne PPL 100% CGXThree Prospects and Five Leads
11
$/bbl
Wellhead Price $83.66
Operating Cost $5.37
Capital Cost $2.20
Government of Guyana Take $40.71
Netback $35.38
NPV10 $15.82
NPV20 $7.94
Probability of Success ~1:5
NPV10 Risked $3.17
NPV20 Risked $1.59 Floating Production Storageand Offloading Vessel
Source: Gustavson Associates January 2008
Metrics of Success
12
Note:
CGX continues to pursue funding through Joint Venture which would reduce the current 25% interest in Georgetown Jaguar and 100% interest in Corentyne Eagle in this scoping valuation.
Prospect ValuationP50 Resource Estimate – NPV20
13
13-5/8”Riser
Well Head
Mud line
Drilling Considerations
Atwood Beacon expected in basin late October
Drilling two wells for Murphy and one for Inpex before drilling Jaguar
Water depth ~80 metres
Jackup rigs utilize a dry BOP Stack
The wellhead riser extends from the sea bed wellhead to the surface BOP
14
Key Management Overview
Kerry SullyPresident CEO and Director
• 40 years experience• Former CEO and Director of Ranchmen’s Resources• Reserve assessments include Iran 1975• Financial modeling Texaco Exploration 1970-73• B.Sc. Chemical Eng, University of Saskatchewan
James Fairbairn, C.A., ICD.DCFO
• 20 years experience with publicly-traded companies• Officer of Claim Post Resources and Treasury Metals• Director Canada Lithium and Trelawney Mining and
Exploration• B.A. University of Western Ontario, Chartered
Accountant
John ClarkeVP, Business Development
• 35 years experience - E&P with Texaco and Candax; O&G Analyst with Deutsche Bank and Octagon
• B.Sc. Physics, Birmingham University• M.Sc. Imperial College• B.A. English, University of Calgary
Warren WorkmanVP, Exploration
• 35 years experience • Previously with Amoco, Unocal and Ranchmen’s• B.Sc. Geology, Queen’s University, Ontario
15
Denis Clement Director
27+ years experience in corporate finance, law and management
Director of a number of public and private resource companies
John Cullen Co-founder and Director
27+ years experience
Co-founder and former director of Candax Energy Inc. and director of a number of public and private resource companies
Edris K. Dookie Co-founder
Executive VP of CGX Resources and President of ON Energy
Adrian Jackson Independent Director
Equity Analyst with Investec Asset Management based in London, UK
Oliver Lennox-King Independent Director
Chairman of the Board of Fronteer Development
Charlotte May Investor Relations
20+ years experience in the institutional brokerage industry focused on junior oil and gas companies
Other Directors and Officers
16
(TSX-V: OYL)168 mm shares o/s177 mm shares f/d
www.cgxenergy.com
Billion Barrel Resource Potential
Offshore Guyana