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Tullow Oil – An Irish Success StoryEngineers Ireland, 06 October 2010
Slide 1Engineers Ireland
Disclaimer
This presentation contains certain forward-looking statements that are subject to the usual risk factors and uncertainties associated with the oil and gas exploration and production business and production business.
Whilst Tullow believes the expectations reflected herein to be reasonable in light of the information available to them at this time, the actual outcome may be materially different owing to factors beyond the Group’s control or within the materially different owing to factors beyond the Group s control or within the Group’s control where, for example, the Group decides on a change of plan or strategy.
Th G d t k bli ti t i h f d l ki t t t The Group undertakes no obligation to revise any such forward-looking statements to reflect any changes in the Group’s expectations or any change in circumstances, events or the Group’s plans and strategy. Accordingly no reliance may be placed on the figures contained in such forward looking statements.
Slide 2Engineers Ireland
Contents
S ti PSection Page
History of Tullow Oil 4
Company Projects 11
Tullow Culture 18
Forward Plans 21
Q & AQ & A
Slide 3Engineers Ireland
Tullow History
• Founded by Aidan Heavey in 1985
- No oil industry experience
- No money
- No local market
• Today Tullow’s market cap. is US$17 billionbillion
- Operations in 24 countries
- Production of 60,000 boepd
- 30th largest company on FTSE
Exploration Growth
Borrow and Buy
Establish Company
Start Up
Slide 4Engineers Ireland
Senegal 1986 – Tullow’s First Project
• Senegal
• Old abandoned wells
• Old abandoned pipelines
• Unavailable power station
• Challenge . . .
• Get wells on production
• Repair pipeline
• Get power station working with gasg g
• Drill and explore
Slide 5Engineers Ireland
Typical Early Asset – Suri Field Pakistan
• Dublin office managed assets in Pakistan, UK, Syria, Egypt, Romania, Bangladesh and Ivory C Coast.
• Tullow’s early focus was on low cost, onshore.
• Full cycle E&P approach:Li li ti- License applications
- Acquire geological data and seismic
- Exploration drilling
- Appraisalpp
- Development
- Production Operations
• In 1990s Tullow built a base for future growth
Slide 6Engineers Ireland
2001 – 2007 Major Acquisitions
• BP Southern North Sea Assets (£200mm)- Big step change in value and manpower
- Re-registered as a UK company in 2000
• Energy Africa ($570mm)- Increased African portfolio in 2004
- Timing was great with rise in oil prices
- Integration challenge – assets & staff
• Hardman Resources ($1.1bln)- Friendly acquisition in 2007
- Added Mauritania and Uganda acreageAdded Mauritania and Uganda acreage
Fast & Flexible Deal Maker
Slide 7Engineers Ireland
Fast & Flexible Deal Maker
Ghana programme delivering excellent results
Four fields discovered since 2007
J bil ld l il fi ld • Jubilee – world-class oil field
• Odum – potential satellite development
• Tweneboa – oil and gas-condensate field
• Owo – major new light oil field discovery
Ongoing Exploration and Development
• Jubilee 1st Oil Nov/Dec 2010
• 120,000 bopd production
• Forecast Capex - $3.35 billion
O o T eneboa & On in a ells• Owo, Tweneboa & Onyinya wells
Slide 8Engineers Ireland
Ghana – FPSO Kwame Nkruhmah
Discovery to first oil in 40 months
Slide 9Engineers Ireland
Discovery to first oil in ~ 40 months
Uganda
• 1 Billion barrels discovered
35 t f 36 ll f l • 35 out of 36 wells successful
• Purchased Heritage Oil’s share
A i h T l d • Agreement with Total and CNOOC for divestment
Discovered
Ugandan Resources (P50)
Resources
Prospective Resources
>2.5bn boe
Slide 10Engineers Ireland
Tullow offices worldwide
DublinIreland
U.K./Norwich
LondonU.K.
Netherlands
Pakistan
Mauritania
Bangladesh
KampalaUganda
Côte d’IvoireGabon
Senegal
Corporate Offices
Key Regional Offices
Tanzania
Madagascar
Uga da
Accra/TakoradiGhana
Namibia
Angola
Note: Tullow also has serviced offices in French Guiana.
y g
Local Offices
Cape TownSouth Africa
Slide 11Engineers Ireland
Resourcing Model - Contract and Outsource
• Joint Ventures – Operated v Non Operated- Industry wide model to mitigate risk
• Core Competence – Internal- Drilling design planning & controlDrilling design, planning & control
- Seismic interpretation
- Geological interpretation
- Reservoir Engineering
- Planning and EHS compliance
• Outsource for Offshore Services- Drilling Rigs
- Seismic Vessels
- Design, Fabrication & Installation
- Field operations
Slide 12Engineers Ireland
In-House Drilling and Reservoir Engineering Expertise
• Drilling Engineering
- Safe environmentally compliant wells- Safe, environmentally compliant wells
- Well planning & design
- Maintain production wells
• Reservoir Engineering
- Reservoir modelling & prod forecasts
- Field well count and prod ratesp
- Reserves booking
• Development and Operations
- Safe surface facilities
- Design and project management
- Manage field operations
Slide 13Engineers Ireland
In-House Geology and Geophysical Expertise
1) Interpret seismic data2) Identify potential leads and prospects
BEFORE INTERPRETATION
13km
Top Triassic
Top Permian SaltMiddle Jurassic
Sea Bed
1 2 3
Slide 14Engineers Ireland
AFTER INTERPRETATIONTop Permian Reservoir
Jubilee subsea facilities
Subsea EquipmentQuantity
Installed Total
Umbilicals 14 14 Miles
Ri id J 2 41
WEST SIDE EAST SIDE
Rigid Jumpers 2 41
Rigid Flowlines 29 29 Miles
Trees 14 16
Electrical Flying Leads 48 110
Steel Flying Leads 37 46
Manifolds 8 8
Tether Pile 9 9
Riser Bases 2 2
Slide 15Engineers Ireland
Average water depth – 1,200m
Jubilee FPSO – Topsides Equipment
Gas compression - Singapore
Water treatment - Malaysia
Oil processing – Indonesia
Slide 16Engineers Ireland
Turret Lift - Singapore
Jubilee field – Operational scale
Initial Estimate (Phase 1)
150-160 Tullow Ghana positions
~700 in-country total
Accra-Takoradi upgraded air-bridge from Nov 09, 10-15 contractor
HQ office~130 TLW +20-30 contract + MODEC Accra
~700 in country total contractors, of which ~400 rotational positions
Total personnel ~1200
P j t i t ll 400 500 Project install +400-500 persons at any one time
Supply + port base+ port ~30 TLW + 20-30 contract persons inc MODEC+ ~25 direct labour contractor+20 stevedore etc
MPV – Bourbon Astyanax
FPSO 50-80 POB, max 120 Rig 1, 100-120
Da ghte
Upgraded helo operation10 pax + 2 crew, x2 craftLatest OGP spec; 20-25 contractor
Daughter Craft.
Slide 17Engineers Ireland
Tanker handlingTug/AHT ~12
Rig 2, 100(rig share)
Marine Fleet1 MPV with ROV, 1-3 AHT/PSVs1 daughter craft, ~100 direct contractor staff
Creating Stakeholder Value
- Ghana: Jubilee discoveryGhana: Jubilee discovery& fast track development
- Uganda: commercialisation, pre-emption & farmdown
Consistent and repeatable strategy• Sustainable long term growth
• Balance exploration, major projects & funding
- High impact exploration portfolio
• Safety, environment, stakeholders & people
Underpinned by financial strategy- $2.75bn debt facilities
- $2.1bn equity placings
- Uganda transactions
Underpinned by financial strategy
• Strong, well funded balance sheet to enable growth
- Debt and equity funding
P tf li tg
- Jubilee Phase 1 first oil Nov/Dec 2010
- Portfolio management
• Significant future operational cash flow
Slide 18Engineers Ireland
Tullow Values
Focus onResults
WorkIntegrity and
Respect
Work Together
EntrepreneurialSpirit
Slide 19Engineers Ireland
Social Enterprise Approach and Strategy
‘Establishing a culture of success that cuts across many social sectors’
Slide 20Engineers Ireland
y
Industry Outlook
Peak Oil
• Supply & Demand
• Oil price outlook
Shale Gas
Gas p icing impact• Gas pricing impact
• LNG market
Slide 21Engineers Ireland
Competition
Chevron
Total
Gazprom
• National Oil Companies
Petronas
Shell
BP
Sinopec - Different type of Competitor
- Access to Licenses
- Overseas expansion
0 100 200 300 400
PetroChina
ExxonMobil
BHP Billiton
M k C $B
p
Market Cap $Bn
• “Drilling on Wall Street”
- Threat of Acquisition
- Premium required by shareholders
- Not in Tullow’s Plans
Slide 22Engineers Ireland
Corporate Level
• Build on Success
- Add acreage, develop discoveries$1,483m2010 Forecast$1,500m
• Long term view
- Deliver on promises to shareholders
2009 $1,140m
- Company reputation and resources
• Portfolio Balance
C i i l
2008
0 400 800 1200 1600
$720m
2000
- Contingent to commercial reserves
- Finance growth and exploration
P&D E&A
Slide 23Engineers Ireland
Summary
• From small start up to FTSE 100p
• Entrepreneurial outlook
• Get right people
• Success is possible
Slide 24Engineers Ireland
Tullow Oil plc5th Floor, Block C
Central Park, LeopardstownDublin, D18
Tel: +353 01 213 7300
Slide 25Engineers Ireland
website: www.tullowoil.com