Exploration - Mining and Petroleum Investment Conference

Exploration
Cracking the code in the Eastern Papuan Basin
13th PNG Mining & Petroleum Investment Conference
Sydney, Australia
3rd December 2014
Disclaimer: Contents And Forward Looking Statements
This presentation includes “forward-looking statements” as defined in United States federal and Canadian securities laws. All statements, other than statements of
historical facts, included in this announcement that address activities, events or developments that InterOil expects, believes or anticipates will or may occur in the
future are forward-looking statements, including in particular, the presence of shallow marine carbonate reservoir, hydrocarbon volumes, and the estimated drilling
times of the Bobcat, Wahoo and Raptor wells.
These statements are based on our current beliefs as well as assumptions made by, and information currently available to us. No assurances can be given however,
that these events will occur. Actual results could differ, and the difference may be material and adverse to the Company and its shareholders. Such statements are
subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause our actual results to differ
materially from those implied or expressed by the forward-looking statements.
Some of these factors include the risk factors discussed in the Company’s filings with the Securities and Exchange Commission and on SEDAR, including but not
limited to those in the Company’s Annual Report for the year ended 31 December 2013 on Form 40-F and its Annual Information Form for the year ended 31
December 2013. In particular, there is no established market for natural gas or gas condensate in Papua New Guinea and no guarantee that gas or gas condensate
from the Elk and Antelope and Triceratops fields will ultimately be able to be extracted and sold commercially.
Investors are urged to consider closely the disclosure in the Company’s Form 40-F, available from us at www.interoil.com or from the SEC at www.sec.gov and its
Annual Information Form available on SEDAR at www.sedar.com.
Finances are reported in US$ unless otherwise stated.
–2–
Disclaimer: Resources
Reference is made in this Presentation to Resources.
It should be noted that we have no production or reserves or future net revenue as defined in NI 51-101 or under definitions established by the United States Securities
and Exchange Commission. GLJ, an independent qualified reserves evaluator, effective as of December 31, 2013, evaluated our gas and condensate resources for the
Elk, Antelope and Triceratops fields, all of which are in onshore Papua New Guinea. The GLJ 2013 Report, with a preparation date of March 11, 2014 was prepared in
accordance with definitions and guidelines in the COGE Handbook and NI 51-101.
This Presentation outlines GLJ's estimates contained in the GLJ 2013 Report effective December 31, 2013 of total and net contingent resources for gas and
condensate at the Elk and Antelope field and the Triceratops field, unless otherwise stated. This Report is included in the Company’s Annual Information Form which is
filed at SEDAR and is available on our web-site.
All resources estimated for the Elk and Antelope fields are classified as contingent resources – economic status undetermined. At this early stage of appraisal, the
resources estimates for the Triceratops field are classified separately in the GLJ 2013 Report as either contingent resources – economic status undetermined or
prospective resources.
Contingent resources are those quantities of natural gas and condensate estimated, as of a given date, to be potentially recoverable from known accumulations using
established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies.
The economic status of the resources is undetermined and there is no certainty that it will be commercially viable to produce any portion of the resources.
Accuracy of Resource Estimates
The accuracy of resource estimates is in part a function of the quality and quantity of available data and of engineering and geological interpretation and judgment.
Other factors in the classification as a resource include a requirement for more appraisal wells, detailed design estimates and near-term development plans. The size
of the resource estimate could be positively impacted, potentially in a material amount, if additional appraisal wells determined that the aerial extent, reservoir quality
and/or the thickness of the reservoir is larger than what is currently estimated based on the interpretation of the seismic and well data. The size of the resource
estimate could be negatively impacted, potentially in a material amount, if additional appraisal wells determined that the aerial extent, reservoir quality and/or the
thickness of the reservoir are less than what is currently estimated based on the interpretation of the seismic and well data.
–3–
Laurie Brown
32 years as exploration
geoscientist
17 years with BP
Former Shell global
consultant
Focused on proving up
emerging basins around
the world
Raptor-1
Overview
New emerging basin
• Elk-Antelope, PNG’s largest
discovery, has put the
Eastern Papuan Basin on the
map as an exciting emerging
province
• InterOil controls the Eastern
Papuan Basin and holds
material equity – a privileged
position
Cracking the code
Current drilling program
• Four components together
are critical for success – the
sweet spot
Looking ahead
• Exploration & appraisal
program
• InterOil prospect inventory
deep and wide
• Raptor-1
• Source, reservoir, seal and
structure – can be mapped
across InterOil’s acreage
• Wahoo-1
• ~40 potential targets so far,
with more than 10 years of
high-growth running room
• Bobcat-1
• Seismic program underway
• Sweet spot defines highgraded area for exploration
• Triceratops-3
• Likely Antelope is not alone
• Antelope-Deep
–5–
New emerging basin
•
Eastern and Western Papuan basins on
trend but with different geology and
petroleum systems
•
The Western Papuan Basin has been
relatively heavily explored (~280 wells) with
discoveries including Hides, Juha, P’Nyang,
Kutubu
•
The Eastern Papuan Basin is underexplored
(~65 wells) with discoveries at Elk, Antelope,
Triceratops and Raptor
•
High quality seismic imaging in the Eastern
Papuan Basin is a very powerful risk
reduction tool
•
Fields
Coral Sea
Seismic is key to cracking the code
–6–
New emerging basin: the geology
4 Key Components
Schematic Cross-section through the Eastern Papuan Basin
Source Rock:
Generates the
hydrocarbons
Reservoir:
Stores the
hydrocarbons
Seal or Cap Rock:
Keeps the
hydrocarbons contained
Structure:
Generates trapping
geometries
–7–
Unlocking the code: InterOil’s acreage
•
•
•
•
•
Elk-Antelope in PRL15 is
PNG’s largest undeveloped gas
discovery
PRL15 sits in the heart of the
Eastern Papuan Basin
Eastern Papuan Basin is an
exciting emerging province
Licence
Acreage
(Acres)
IOC Stake
% (Gross)
PRL 15
188,675
36.5%
PRL 39
188,877
69.1%
PPL 474
1,232,462
78.1%
PPL 475
524,315
65.2%
PPL 476
1,215,243
78.1%
PPL 477
629,254
78.1%
TOTAL
3,978,828
PPL477
PRL39
PPL475
PRL15
Eastern
Papuan
Basin
InterOil has material interest
over most of the Eastern
Papuan Basin
PNG
Nearly 4m acres (22x larger
than Singapore)
–8–
SEEPAGE
SEEPAGE
PPL476
PPL474
Unlocking the code: airborne gravity
•
Early regional reconnaissance exploration used airborne
gravity
Elk-Antelope anomaly
Bobcat anomaly
Triceratops anomaly
•
Low cost non-invasive initial exploration tool
Puri-Raptor-Duck Bill
anomaly
•
95% of acreage covered
•
20+ anomalies identified
•
New technological advances have materially improved
gravity surveying techniques
•
Eastern
Papuan
Basin
Wahoo-Mako
anomaly
Deploying airborne gravity gradiometry over our acreage
–9–
Page 9
Unlocking the code: seismic
•
Seismic confirms gravity anomalies, identifies drilling
locations, and maps potential volume
IOC acquired seismic surveys pre-2013
•
The key pre-drill risk reduction tool in Eastern Papuan Basin
– firms up targets to drill-ready
•
$153m invested in seismic covering over 1,500km – more
than any other PNG operator
•
New acreage-wide seismic campaign underway
•
Accelerate maturing some of the 40 targets to drillable
status
Eastern
Papuan
Basin
– 10 –
Page 10
Unlocking the code: interpretation
A02IOL09
•
•
•
•
Seismic – the most powerful pre-drill risk reduction tool –
key to cracking the code
Defines scale of prospects, can allow wells to be
optimally located on reservoir sweet spots
Comparison
processing:
of
previous
seismic
data
with
Choice 2013
2013 reprocessing – now used for Elk-Antelope appraisal
Antelope Trend
Top reservoir
Whitetail Trend
new
•
Lower panel shows original seismic line acquired
in 2007
•
Upper panel shows same seismic line with
modern reprocessing, can see top of reservoir
and identify sweet spots
•
New interpretation clearly shows three trends
Raptor Trend
A02IOL09
Original 2009
Antelope Field
2007 analysis – used at time of Elk-Antelope discoveries
Currently
evaluating
Elk-Antelope
incorporating
improved dataset plus recently acquired seismic over
south of the field
– 11 –
Current drilling program focuses on three trends
•
Core sub-set area around Antelope – Significant tieback potential around Elk-Antelope
•
Three trends identified
•
At least 11 structures - 4 discoveries drilled to date
•
Raptor-1
•
•
Bobcat-1
•
•
Encountered 320m of
currently testing
reservoir section,
Triceratops-3
•
•
Declared discovery, planned appraisal 2015
Scheduled for 2015, site prep underway
Antelope-Deep
•
High impact, lower risk
•
Expected 2015 subject to JV approval
– 12 –
Looking ahead: drilling program
•
•
40 potential targets identified
Ongoing
seismic
acquisition
and
gradiometry to mature prospect inventory
Elk-Antelope Field
Triceratops
Field
gravity
36.5% Equity Interest
Antelope-4 Spudded
Antelope-5 exp. Q4 2014
69.1% Equity Interest
Exp Spud. 2015
Bobcat-1
78.1% Equity Interest
Spudded 2014
•
Antelope Deep
36.5% Equity Interest
Pending JV approval
Exp Spud. 2015
Drilling has two key drivers:
1 - Near-field tieback potential to Elk-Antelope
•
Triceratops, Bobcat, Raptor and AntelopeDeep within tie-back range
Raptor-1
65.2% Equity Interest
Spudded 2014
45km indicative
Tie-back to ElkAntelope
Wahoo-1
78.1% Equity Interest
Plan to return 2015
2 - Standalone development projects
•
Wahoo – standout target
•
Resume drilling in 2015
•
Safety is paramount
PNG
PNG LNG Plant
Port Moresby
– 13 –
*All interests shown are gross before PNG Government’s statutory back-in rights
Looking ahead: seismic & AGG program
2014 Murua Seismic Survey
•
Start: Q4 2014
•
End: Q3 2015 (3 Phases)
•
Target: Gravity anomalies
•
Potential to be significantly expanded
Airborne
Gravity
(AGG) Survey
Gradiometry
•
Coverage of entire exploration acreage
with AGG
•
Fixed wing and rotary
– 14 –
Summary
Geology
•
Unlocking the code
Two major petroleum basins in
PNG – the Eastern and
Western Papuan Basins
•
•
InterOil controls the relatively
unexplored Eastern Papuan
Basin
•
•
InterOil has best knowledge of
basin, with four discoveries
already including the ElkAntelope gas field and most
recently, the Raptor discovery
Analysis of all data indicate
the widespread presence of
the 4 components critical for
success, reservoir, source
rock, seal and structure
•
All key components critical for
success present in this basin
•
InterOil has >1,500km of
seismic and gravity imaging
over > 95% of its acreage
Sweet spots identified
throughout the acreage - up
to 40 potential targets
– 15 –
Strategy
•
Antelope may not be alone
•
Exploration success to be
expected but so is failure
•
InterOil now funded and
focused to deliver on long term
exploration and appraisal
program
•
Right team in place
•
Create a ‘PRL Factory’
Thank You
For more information, please contact:
Michael.Lynn@interoil.com
Senior Vice President, Investor Relations
David.Wu@interoil.com
Vice President, Investor Relations