Presentation on theme: "PetroLatina Energy Exploration and Production in Latin America"— Presentation transcript:
1 PetroLatina Energy Exploration and Production in Latin America Oil Barrel 22nd February 2007
2 Forward Looking Statement Certain statements contained in this document constitute “forward-looking statements”. Such forward-looking statements involve risks, uncertainties and other factors which may cause the actual results, performance or achievements of the relevant entities, or the results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These forward-looking statements are based on numerous assumptions regarding the Company’s present and future business strategy and the environment in which the Company will operate in the future. There can be no assurance that the results and events contemplated by the forward-looking statements in this document, will, in fact, occur. The Company undertakes no obligation publicly to release the result of any revisions to any forward-looking statements in this presentation that may occur due to any change in the Company’s expectations or to reflect events or circumstances after the date of this presentation. All subsequent written or oral forward-looking statements attributable to the Company, or persons acting on behalf of the Company, are expressly qualified in their entirety by the cautionary statements contained throughout this presentation. As a result of these risks, uncertainties and assumptions, a prospective investor should not place undue reliance on these forward-looking statements.
3 Aims and GoalsTo build an independent oil and gas company in Latin AmericaProvide strong growth returns to shareholdersTo do so in a socially aware fashion ensuring:Protection of the environmentDevelopment of the local employees
4 HighlightsCompany Listed on London Stock Exchange on 14th January 2005.Operations established in Guatemala on 6-93 licence.Completed one well and two work-overs on the Las Casas structure, two of which confirmed producible oil.Acquired Licence (Tortugas/Atzam) in 2005 Guatemalan licencing round.Obtained significant interests in two exploration licences in Colombia.Acquired Petroleos del Norte (“PDN”), a Colombian producing oil and gas company.Tested Serafin Gas well at 14 million cubic feet per day in February 2007.
5 Where we are todayTwo producing licences and five exploration licences in Colombia and two licences in GuatemalaProved, probable and possible reserves of approx. 40 million barrels, with a further 120 million barrels of potential.Current production of approximately 500 barrels a day (“bopd”), which could rise to 1,500 bopd with secondary development of Colombian FieldsSerafin well #1 tests at 14 million cubic feet a day. Commercial gas sales at end 2nd Quarter 2007.Ownership of the strategic Rio Zulia – Ayucucho Pipeline:2006 Revenue $1.6 million.
7 Shares & Shareholding Ordinary Shares $0.10 – 114,007,122 Diluted – 150,648,601Options - 1,322,000Warrants - 35,319,479Major Shareholders:Directors & Senior Management %Rab Capital %Artemis Investment Management %Continental Capital %Chasm Lake Management %Millenium Global Natural Resources %Fidelity International / FMR Corp %
8 Management Team Chairman and CEO - Greg Smith President and COO – Jay Scott(Previously Chief Operating Officer, Arawak Energy & Bitech Petroleum)Chief Financial Officer – Ian Refault(Formerly Commercial Director, PetroKazakhstan (Downstream Marketing) & VP Finance / CFO, Bitech Petroleum)Chief Geologist – Kevin Dean(Previously Chief Geologist Arawak Energy & Bitech Petroleum, Geologist at Mobil)Executive Director – Mark Patterson(Managing Partner of Calypso Energy & formerly CEO Compania General de Combustibles Argentina)
9 Management track record Key members of the Team have:Worked togetherA history of generating strong returns to shareholders (PetroKazakhstan, Arawak and Bitech)Successful record in:Running international E&P companiesPublic companies listed on the London, New York and Toronto stock exchangesDiscovering oil fieldsDeveloping oil and gas fieldsThe team also has extensive experience in debt and equity fund raising
12 Rio Zulia – Ayacucho Pipeline 183Km long, 10” dia.Two pumping stations25,000bopd capacity2006 average 3,176 bopd throughput
13 PDN Assets Tisquirama Licence Lebrija Licence Los Angeles field – 50% interestSanta Lucia field – 25% interestLebrija LicenceDona Maria field – 100% interestThree technical evaluation licences100% ownership of the Rio Zulia – Ayacucho pipeline with 25,000 bopd capacity
14 Colombian Producing Reserves Millions of stock tank barrelsGross P1Gross P1+P2Gross P1+P2+P3Net P1Net P1+P2Net P1+P2+P3Los Angeles3.6784.6656.6401.8392.3323.320Santa Lucia2.59317.36339.5140.6484.3419.878Dona Maria0.266Total6.53722.29446.4202.7536.93913.464Table does not include Serafin gas reserves
15 Crude Quality and Pricing Santa Lucia crude is:18° APIPriced against WTIPricing formula = (WTI*0.95)-$6.85Los Angeles crude is:13° APIPriced against fuel oil 1Pricing formula = (Fuel Oil 1*0.84)-$1.30December 2006 discount to WTI-$30
19 Serafina Gas Well & Pipeline Tie-in Completed work-over gas well on Tisquirama licence.Initial test flow at 14 mmcf / dayHigh gas demand in Colombia ($ $3.0 mcf)3.5km tie-in to nearby gas pipeline.Investment $0.6 million (net to interest).Potential payback – months.Fast cash generator.
20 Colombian Exploration Licences Midas70% interestOperator6 year work programmeFirst year new and reprocessing of 2D seismic ($1.5 million)Potential based on leads – 90 million barrels (net 63 million)La Paloma65% interestNon - Operator4 year work programmeFirst year new and reprocessing of 2D seismic ($1.0 million)Potential based on reprocessed seismic – 90 million barrels (net 58.5 million)
21 Colombian Fiscal Position PDNRoyalty 20%Ecopetrol back in rightExploration licencesSliding scale of royalty 5 to 25%No EcoPetrol back in rightCorporate Tax – 35%
23 Guatemala - unexploited opportunity Under explored region with high potentialProximity and similarity in the geology to MexicoTrends in which major Mexican discoveries (e.g. Nazareth Field) have been found extend into GuatemalaPositive and encouraging political and economic environment
24 PetroLatina’s Guatemalan Licences Las CasasTortugasArea
25 6-93 Licence Location – Peten Basin Area – 323,000 acres Term – 25 years from October 1993Reconfirmed production at Las Casas.Las Casas 1x - produced at 80 bopdLas Casas 3x - encountered oil. Swab test produced oil.Still to test Huapac potential and additional nine leads
30 Tortugas – Licence 7 -2005 Location – Peten Basin Area – 77,718 acres Term – 25 years from September 200513 wells drilled on the licence of which 8 encountered hydrocarbonsTwo main areas of interest Tortugas salt dome and Atzam
31 Proved, Probable & Possible Guatemalan ResevesMillions of stock tank barrelsProvedProved & ProbableProved, Probable & PossibleLas Casas0.0961.15617.657Huapac3.310Tortugas *0.3090.5963.872Total0.4051.75224.839* This does not include Atzam which is estimated to be between 5 and 16 million barrels of potential reserves
32 Fiscal regime Guatemala Royalty based on API of crude Profit share, sliding scale linked to productionCost recovery = 100%Corporate Income tax at 31%
33 Marketing Options XAN Field Rublesanto Tortugas Lincence 7-2005 Licence 6-93Las CasasPiedras Negras
35 Colombian Work Programme Q1 2007Q2 2007Q3 2007Q4 2007PDN AssetsSerafin DevelopmentTisquirama Licence ExtensionTEA’s – Review of TEA PotentialAcquire new seismic on retained TEA’sTisquirama Secondary DevelopmentMidas & La PalomaSeismic AcquisitionWell StudiesGeochemical SurveyProspect evaluationAcquire new 3D seismic – La Paloma
36 Guatemalan Work Programme & Review Q1 2007Q2 2007Q3 2007Q4 20076-93Geological/Geophysical/Engineering ReviewA7-2005Atzam 2 remedial work plan1. Licence 6-93 requires an ongoing detailed technical review to better understand sub-surface geology. 2. Atzam 2 well – strong reservoir pressure but damage to well casing and cement require further work plan & engineering analysis Force majeure filed on Tortugas area of A licence pending MEM resolving land access issues with Municipality of Coban. 4. Office and field costs reduced to absolute minimum.
37 PDN 2006 Financial Forecast (Post acquisition) PDN 2005 Financial ResultsTurnover – US $7.2 millionEarnings – US $0.9 millionOperating Cash flow – US $3.2 millionPDN 2006 Financial Forecast (Post acquisition)Turnover – US $ 4.3 millionEarnings – US $ 1.3 millionOperating Cash flow – US $ 1.9 million
38 Market Data Listing AIM EPIC PELE Nomad Seymour Pierce Public Relations Pelham PRCurrent share price pence (16/02/07)
39 PetroLatina Energy Plc New E& P Company with Latin American focus.Strong management team with extensive oil & gas and international experience, together with track record of running public companies.Acquired strong position in Colombia & Guatemala is an under-explored but potentially prolific oil and gas region.Have current oil production which can be rapidly increased through secondary development in Colombia.Colombian gas commercial production at end 2nd Quarter 2007Total 3P and potential reserves are approximately 160 million barrels.Well positioned for future growth, both organically and through acquisitions.
41 Guatemalan Fiscal Regime Licence6-937-2005Royalty20% for 30° API +/- 1% per degree API changeEstimated royalty Rate29 to 30%Minimum Government take<15,000 bopd = 40%<20,000 bopd = 30.07%Maximum Government Take>75,000 bopd = 75%>90,000 bopd = 72%
42 Guatemalan Fiscal Regime Cost Recovery Cost recovery statements required to be approvedOnly costs related to the defined zone of commercial production are allowedOnce allowed, approved cost recovery is fully deductible in period approved
43 Guatemalan - Corporate Income Tax Levied against a company’s profitsCapital expenditure is 100% allowable in year that it is incurredOne third of profit share is deductibleTax rate is 31%