Presentation is loading. Please wait.

Presentation is loading. Please wait.

Grant Willis Global Head of Natural Resources The Australian Oil & Gas Industry January 2014.

Similar presentations


Presentation on theme: "Grant Willis Global Head of Natural Resources The Australian Oil & Gas Industry January 2014."— Presentation transcript:

1 Grant Willis Global Head of Natural Resources The Australian Oil & Gas Industry January 2014

2 2 This presentation does not constitute an offer to provide finance on any terms. The provision of any such offer is subject to formal review and credit approval, satisfactory due diligence, sign off by legal, tax, accounting and other professional advisers and execution of satisfactory documentation. The Commonwealth Bank shall not be bound unless and until final terms are agreed and formal documentation is signed. That final documentation may not necessarily mirror the contents of this presentation and any actions you may choose to take should not be taken in reliance on this presentation. The information contained herein is confidential and is the proprietary structure of the Commonwealth Bank. It is provided on the basis that you will not disclose its contents to any persons other than directors, employees and advisors without the written consent of the Commonwealth Bank. It is not to be discussed either directly or indirectly with any other financier. This obligation will not apply if the information is available to the public generally (except as a result of a previous breach of this confidentiality obligation) or you are required to disclose it by law. © Copyright Commonwealth Bank Australia

3 3 The Commonwealth Bank of Australia Australia’s largest bank by market capitalisation Statutory NPAT A$7,677m Cash NPAT A$7,819m Return on equity 18.4% Total assets A$754b Cash earnings per share A$4.86 Dividend per share A$3.64 Basel III CET1 (International) 11.0% $101b June 2011 $135b June 2012 $137b June 2013 S&PMoody’sFitch CREDIT RATING KEY FINANCIALS GLOBAL COMPARISON LIQUIDITY (AUD) Market Capitalisation (US$bn) Global Market Capitalisation Ranking Senior Debt Rating Moody’sS&P A2A A3A Aa3A Baa2A Baa2A Aa2AA Aa3AA Baa1A-  Industry specialisation and understanding make the Bank an ideal partner providing balance sheet strength and broad product capability  Oil & Gas industry teams placed in key commercial and financing hubs. CBA is a Bank that actively deploys balance sheet into our client’s businesses  Broad range of debt products spanning project, corporate and acquisition finance  Strong global financial markets capabilities across commodities, foreign currency and interest rates  The only domestic Australian bank with a full in-house equity business, focused on retail and institutional clients Source: Bloomberg. As at 13 January Credit rating: S&P 14.6m Customers 3,000 Institutional Clients

4 4 The Bank provides Natural Resources and product specialists across the globe The Growing Commonwealth Bank of Australia New York office Houston office United States Canada Singapore office Hong Kong office East & SE Asia Sydney office Australia New Zealand East & SE Asia London office UK Norway The Netherlands Eastern Europe Africa

5 5 Commonwealth Bank of Australia – Products and Clients Financial Markets Transaction Banking Capital Raising Cash & Treasury Management Payables & Procurement Foreign Currency Accounts Trade Finance CommBiz Term Deposits Working Capital Acquisition & Bridge Finance Project & Development Finance Corporate & Structured Asset Finance Equity & Debt Capital Markets Commodities Sales & Trading Structured Commodity Finance Structured Investments Interest Rates FX

6 6 CBA’s Global Outlook 2010 (a)2011 (a)2012 (a)2013 (a)2014 (f)2015 (f) GDP Growth (% YoY) FX AUD/USD EUR/USD GBP/USD Base Interest Rate Reserve Bank of Australia (RBA)2.50%2.56%3.00% US Federal Reserve (Fed)0.25% 0.75% European Central Bank (ECB)0.25% People's Bank of China - Benchmark 1 Year Lending Rate6.00% Oil (USD/bbl) WTI Brent Australian Economy – Outlook

7 7 Natural Resources Economic Data Source: CBA

8 8 Global Listed E&P Stocks Where does Australia stand? # of Stocks % of Stocks Mkt. Cap (USDbn) % of Total Mkt Cap Median (USDm) Global Revenue (USDm) % of Global Revenue Global % % % US33532%60849% % Canada34733%18515%175812% Europe (incl UK)13913%13611%80286% Asia Pac (ex AU)555%22618% % Australia13613%675%20133% Market Capitalisation of Global E&P Stocks Source: CBA and Bloomberg

9 9 Australian E&Ps by Market Capitalisation (AUDm) Source: CBA and Bloomberg ASIA

10 10 Are attracting a roll call of international majors / Amount$156m Acres7.7m EV / Acre20.3 DateDec-2011 / Amount$70m Acres4.0m EV / Acre17.6 DateMay-2011 Amount$12m Acres1.9m EV / Acre6.2 DateMay-2012 / Amount$111m Acres7.7m EV / Acre14.4 DateSep-2011 / Amount$152m Acres4.1m EV / Acre37.3 DateNov-2012 / Amount$210m Acres9.1m EV / Acre22.9 DateJun-2012 APLNG, Arrow LNG, GLNG and QCLNG, / Amount$50m Acres3.3m EV / Acre15.0 DateDec-2010 / Amount$101m Acres0.4m EV / Acre268.6 DateJul-2011 Source: Relevant company announcements / Amount$32.2m Acres5.5m EV / Acre5.9 DateNov-2013 Recent Unconventional Gas Farm-ins / Amount$349m Acres0.4m EV / Acre904.1 DateFeb-2013

11 11 Putting the Australian opportunity in context United States of AmericaAustralia Land Area3.79 million mi million mi 2 Natural Gas Demand24.37 Tcf/yr (Net Imports 1.94 Tcf/yr) 2.09 Tcf/yr (Net Exports 1.0 Tcf/yr) 2,203 Tcf 1 Gas Resource Potential820 Tcf 2 Gas Prices (US$/MMBtu)$10 $3$5 $9 Ability to Deliver 1.Technically recoverable resources 2.Total demonstrated gas resources 3.Number of plants Source : EIA Independent Statistics & Analysis, EIA Annual Energy Review 2011, BREE 2012 Gas Resource Assessment, Energy Quest and Santos analysis USAUS Rigs1,80050 Wells37,0001,200 Processing (3) Pipelines (mi)350,00020,000

12 12 Australian Exploration Activity and Expenditure Source: APPEA

13 13 Historical Oil & Gas Production Source: APPEA

14 14 Australian LNG Exports to Exceed 78 mtpa by 2020 LNG Exports – by country

15 15 Australian & Papua New Guinean LNG Projects Offshore Conventional Gas to LNG Projects Coal Seam Gas to LNG Projects Onshore Conventional Gas to LNG Projects (P) Proposed (C) Construction (O) Operating GLNG (C) GLNG Santos / Petronas / Total QCLNG (C) BG Group Scarborough FLNG (P) ExxonMobil / BHP Gorgon (C) Chevron Darwin LNG (O) ConocoPhillips PNG LNG (C) ExxonMobil / Oil Search/ Santos Liquid Niugini Gas (Elk 1&2) (P) InterOil / Total Pluto (O) Woodside Browse (P) Woodside NWSV Trains 1-5 (O) Woodside Sunrise (P) Woodside Wheatstone (C) Chevron / Apache Prelude (C) Shell Ichthys (C) INPEX / Total APLNG (C) Australia Pacific LNG ConocoPhillips / Origin Energy / Sinopec Bonaparte FLNG (P) Santos / GDF SUEZ Arrow LNG (P) Shell / Petro China Source: WorleyParsons, CBA

16 16 Case Study: Ichthys LNG Project Principal Project Components USD34bn capex budget The upstream facilities comprise around 50 subsea production wells and subsea production systems connected to a Semi-sub central processing facility and FPSO Gas will be transported to the LNG plant at Darwin via an 889km, 42” sub- sea pipeline Once transported to Darwin the gas will be processed at the onshore LNG Facilities. The project is designed to produce approximately 8.4mtpa of LNG from two trains, up to 100,000 bpd of field and plant condensate and up to 1.6mtpa of LPG at peak, with First LNG is scheduled for 2016 Principal Project Components USD34bn capex budget The upstream facilities comprise around 50 subsea production wells and subsea production systems connected to a Semi-sub central processing facility and FPSO Gas will be transported to the LNG plant at Darwin via an 889km, 42” sub- sea pipeline Once transported to Darwin the gas will be processed at the onshore LNG Facilities. The project is designed to produce approximately 8.4mtpa of LNG from two trains, up to 100,000 bpd of field and plant condensate and up to 1.6mtpa of LPG at peak, with First LNG is scheduled for 2016

17 Conclusions  The future of Australian oil & gas is bright.  CBA remains committed to the sector.  Oil prices remain high against historical, domestic gas prices are rising – the economic settings are stable.  The conventional gas fields in central Australia are enjoying a renaissance.  7 LNG projects will shortly begin producing in 2014 and ramp up into  International players continue to invest and support the Australian oil & gas industry.  We could do with finding some more oil though.

18 18 Key Contacts Grant Willis Managing Director P: E: 85 Queen Victoria St, London England Client Coverage Group Michael Thorpe Managing Director P: +61 (0) E: 201 Sussex Street Sydney 2000 Geoff Carrick Managing Director P: +61 (0) E: 201 Sussex Street Sydney 2000 Andrew Loadsman Executive Director, Natural Resources P: +61 (0) E: 201 Sussex Street Sydney 2000 Australia Charles Davis Executive Director P: +61 (0) E: 201 Sussex Street Sydney 2000 Michael Neal Executive Director P: +61 (0) E: 201 Sussex Street Sydney 2000 Jan Gabrynowicz Director, Oil, Gas, Energy & Utilities P: +61 (0) E: 201 Sussex Street Sydney 2000 Howard Mann Associate Director P: +61 (0) E: 201 Sussex Street Sydney 2000 Project FinanceEquity Capital Markets Houston to UPDATE AS RELEVANT

19 19 Disclaimer & Confidentiality This Discussion Paper, provided by Commonwealth Bank of Australia ABN (‘Commonwealth Bank’), is confidential and is provided to you on the basis that you will not disclose its contents to any person other than your directors, employees, agents and professional advisors without our consent. The information provided in this document is the copyright of Commonwealth Bank. This obligation will not apply if the information is available to the public generally (except as a result of a previous breach of this confidentiality obligation) or you are required to disclose it by law. Commonwealth Bank believes that the information herein is correct and any opinions, conclusions or recommendations contained in this document are reasonably held or made as at the time of its compilation but makes no warranty as to the accuracy and reliability of the completeness of that information. The Commonwealth Bank accepts no responsibility for any loss or damage which may be suffered by any person, directly or indirectly, as a result of the material contained in this document. The contents of this document should not be relied upon as a substitute for appropriate/ professional advice or as a basis for formulating business or other decisions. The information contained in this presentation is made available only for persons who are wholesale clients as defined in the Corporations Act This document is not intended to represent an offer of finance or to issue any financial products, and is based on Commonwealth Bank’s current understanding of the facts. Further due diligence of the specific circumstances is required to confirm any outcomes are achievable. Any subsequent financing proposal would be subject to Commonwealth Bank’s formal review and credit approval process, market conditions at the relevant time and documentation. All legal, accounting or taxation outcomes described or alluded to in this Discussion Paper are provided without any liability whatsoever to Commonwealth Bank, whether for negligence or otherwise, and are not intended to constitute legal, accounting or taxation advice. The information provided is therefore indicative of what the expected outcomes of the transaction might be, based on assumed facts as contemplated by the Discussion Paper, and should not be relied upon. On this basis, no representation or warranty, expressed or implied, is made as to the accuracy, completeness or thoroughness of content of such information. As actual outcomes will depend on each client’s specific facts and circumstances, it is with respect to such unique facts and circumstances that we strongly advise that your company seek its own legal, accounting and taxation advice. Select which disclaimer to include

20 20 Australia – It’s a Gas! Source: EIA, Technically Recoverable Shale Oil and Shale Gas Resources, June 2013 Recoverable Shale Gas Resources: Top 10 Shale Gas (TcF) Rank # China1,1151 Argentina8022 Algeria7073 USA6654 Canada5735 Mexico5456 Australia4377 South Africa3908 Russia2859 Brazil24510 World Total7,299 Source: Geoscience Australia

21 21 Largest ever project financing transaction Ichthys LNG Project – Project Financing Inpex (Japan) and Total SA (France) are the major partners in the Ichthys LNG project which raised USD20bn of project financing and reached financial close in January 2013 CBA is the largest non-Japanese lender CBA is the Intercreditor Agent and Uncovered Sub-Facility Agent Largest Project Finance Deal  Project sponsor engagement with Export Credit Agencies (ECA) commenced during 2010 – over two years ahead of financial close  The financing process commenced in November 2011 when lenders provided preliminary RFPs. Banks provided final credit approvals in June 2012 and Financial Close was reached in January 2013, eight months after receipt of the formal RFP  Significant debt amount – USD20bn the largest ever project financing  Multi-lender engagement strategy (ECAs, banks and sponsor debt, and provision for bonds)  Banks lent USD10.2bn to the project (USD4.8bn Uncovered (47%) and $5.4bn (53%) Covered)  3 ECAs directly lent USD5.8bn, and Sponsors provided loans of USD4bn The project has a number of attractions and some challenges to lenders:  Strategically aligned Sponsors group (Inpex 66%, Total 30%), with Total being a well credentialed LNG developer and operator  The liquids rich conventional gas resource delivers strong project economics  Committed off-take arrangements from ten buyers, 68% going to Japanese buyers, Sponsors buying 21%  Robust project finance structure with contracted senior sponsor support in various forms Ichthys LNG Project USD20bn Intercreditor & Uncovered Sub-Facility Agent December 2012 Asia Pacific Deal of the Year Ichthys LNG Project USD20bn MLAB Commercial Bank Facility December 2012 Global Deal of the Year Asia-Pacific Multi-sourced Deal of the Year


Download ppt "Grant Willis Global Head of Natural Resources The Australian Oil & Gas Industry January 2014."

Similar presentations


Ads by Google