Fastnet Oil & Gas Plc Corporate Presentation September 2014 Disclaimer
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Neither the Company, nor its employees, advisers or representatives nor any other person makes any guarantee, representation, undertaking or warranty, express or implied as to the accuracy, completeness, correctness or fairness of the information and opinions contained in this document (or as to the reasonableness of any assumptions on which any of the same is based or the use of any of the same), nor does the Company nor its employees, advisers or representatives nor any other person accept any responsibility or liability whatsoever for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection therewith. The information set out herein may be subject to updating, completion, revision, verification and amendment and such information may change materially. If you rely on this communication to make an investment you may be exposed to a significant risk of losing all of your investment. This communication does not constitute either advice or a recommendation regarding any securities. Any person who is in any doubt about the subject matter of this communication should consult a duly authorised person specialising in advising on such investments. This communication includes forward-looking statements. These forward-looking statements include all matters that are not historical facts, statements regarding the Company's intentions, beliefs or current expectations concerning, among other things, the Company's results of operations, financial condition, prospects, growth, strategies, and the industry in which the Company operates. By their nature, forward-looking statements involve risks and uncertainties. You are cautioned that forward-looking statements are not guarantees of future performance and that the Company's actual results of operations, financial condition and the development of the industry in which the Company operates may differ materially from those made in or suggested by the forward-looking statements contained in this communication. Past performance is not a guide to future performance. www.fastnetoilandgas.com 2 Company Overview
Moroccan Assets Company Overview Irish Assets
OutlookMoroccan Assets
Irish Assets
Outlook OVERVIEW Overview and Company Funding
• 25,053 sq. km. under licence onshore and offshore Morocco and offshore Ireland with 16 primary exploration and appraisal prospects matured for drilling
• Cash balance USD 20 mm at 31 July 14 • Running costs – general and administration – USD 2.6 mm p.a
• Fully funded to meet all current licence phase commitments - monetisation through farm down and recovery of past costs
• Partners – Kosmos Energy, BP, SK, Asia’s fourth largest oil refiner and with proven reserves of 619 mm BOE, and PETRONAS
• Tendrara Lakbir well planning on schedule. Recently announced improved net equity position of 50% significantly enhances project economics. Significant interest from industry majors recognizing additional upside in unconventional shale gas play.
• Celtic Sea farm out process well underway. Internal technical work continues to enhance value with completion of 3D interpretation. Offers expected Q4.
• FA-1 well reached TD May 14, under budget. Numerous oil and gas shows encountered in well. Full prognosed section not penetrated due to salt occurring shallower than predicted. FA-1 results have significantly de-risked the Foum Assaka license area.
www.fastnetoilandgas.com 4 OVERVIEW Business Model Health Check
• 25,053 sq. km. under licence and exclusive options ACQUIREACQUIRE • New niche opportunities being reviewed in onshore East Africa
• 1,910 sq. km. of 3D seismic acquired in Ireland ANALYSEANALYSE • 488 sq. km. of 3D seismic reprocessed onshore Morocco • Up to 5,000 sq. km. of 3D seismic acquired/reprocessed offshore Morocco
• Foum Assaka farmed out to SK Innovation – carry in up to 2 wells plus back costs FARMFARM DOWN DOWN • Total cost to Fastnet from licence acquisition to completion of the FA-1 well was USD 2.75m • Celtic Sea and Tendrara Farmouts well underway – 9 front-runners
• FA-1 first well tested the high risk, deepwater, acreage in the portfolio • De-risked petroleum system – oil shows encountered, sand presence confirmed but EXPLOREEXPLORE thickness/quality remains issue • Tendrara Lakbir well planning under way and on track • Celtic Sea 3D Interpretation has defined and de-risked very large potential oil and gas prospects
• FA-1 encountered non-commercial hydrocarbons, derisked elements of petroleum system for future prospect evaluation. MONETISEMONETISE • Tendrara – Lakbir drilling programme offers next near-term opportunity for monetisation • Deep Kinsale and Mizzen prospects offer medium term potential for monetisation following farm- www.fastnetoilandgas.com down/drilling 5
OVERVIEW Potential Near Term Catalysts to Unlock Shareholder Value Fastnet Risked Net Asset Value 41.5p
40
35 Celtic Sea Celtic Sea Farmout 15p • Significant industry interest in Celtic Sea licences following results of 3D seismic
30 ) interpretation • Farmout will validate the quality of
GBp Fastnet’s portfolio and crystallise value 25 with back costs of up to USD 22 mm repayable Tendrara Farmout & 2015 Drilling • Fastnet objective is to retain material 20 Programme carried interest in multi-well drilling programme in 2016 • Farmout process well underway • Terms to include reimbursement of back costs 21p Tendrara* 15 and disproportionate share of the cost of two
wells to be drilled in 2015 Net Asset Value ( Value Asset Net • Multi well drilling programme will target High 10 Estimate Case of 892 BCF which provides substantial upside to current NAV estimates
Implied value of Exploration and 5 Foum Assaka** 1.5p Appraisal Portfolio 2p
3.5p Cash Balance 3.5p Cash 0 Price: 5.05p as at 06/08/14 Source – Shore Capital March 2014 www.fastnetoilandgas.com *Management estimates based on re-risking of CPR, volumes Nov 2013. 6 *Unrisked P50 value: 30p **Value of the carry in 2nd exploration well THE TEAM Experienced Board & Senior Management
Paul Griffiths, Managing Director 38+ years Value Creation 100% . CEO of Island Oil & Gas Plc until its acquisition by San Leon Experience in oil Sold IPDL to DNO ASA, after 100% exploration Energy Plc in 2009 and gas exploration reverse takeover of success rate offshore . Built and sold 3 oil and gas companies between 1999-2012 and near term field Providence Resources Plc Ireland with Island Oil & . Senior geophysicist for Gulf Oil Corporation for Europe and appraisal collapsed in 2002, for an exit Gas: 4 wells drilled, two Mediterranean Region and Gulf R&D in Pittsburgh price of $34 mm after commercial gas fields investing approx. $1.5 mm Carol Law, Executive Director 30 years 100 TCF + $2.64 billion . Former Exploration Manager, Anadarko East Africa Experience in oil Carol led the Anadarko team Sale price of a 10% . Responsible for the play finding Prosperidade gas complex in and gas industry that discovered over 100 TCF stake in Anadarko’s Rovuma Area 1, offshore Mozambique of natural gas in the Area 1 Area 1 Block, Offshore . Also member of teams responsible for discoveries in Ghana Block, Offshore Mozambique Mozambique (Jubilee), Brazil (multiple Campos Basin discoveries) 25+ years €100 million $2.5 billion Cathal Friel, Executive Chairman . Managing Director and one of the founders of Raglan Capital in Managerial One of the founding directors Value of successful 2007 Corporate Finance of Merrion Capital, where he corporate transactions . Former founding partner and Director of Merrion Capital experience was part of the small team on which Cathal has . MBA from University of Ulster that built the business and advised sold it for c. €100m in 2006
Will Holland, Chief Financial Officer 20+ years +$110 million Internal Control . Former Associate Director at Macquarie bank where he originated, Experience in oil Managed Macquarie interest Lead teams of internal structured and managed equity and debt investments in small-cap and gas industry in over $110 million of debt auditors at Halliburton E&P companies. and equity investments assessing accounting & . Previously worked at Halliburton Energy Services in various operation risks technical & business development roles based in Africa & Europe . MBA from Heriot-Watt University 18+ years +1900% $1.9 billion Michael Nolan, Non-Executive Director . Former Founder and Group Finance Director of Cove Energy PLC Experience in Share price increase between Cove Energy was sold . Currently CFO of Discover Exploration and Non-executive director resource the Cove Energy IPO in June to PTTEP in Aug 2012 of Rathdowney Resources plc and Orogen Gold plc exploration sector 2009 and its sale in Aug 2012 after a competitive . Fellow of the Chartered Accountants Ireland auction process
Company Overview
Moroccan Assets Company Overview Irish Assets
OutlookMoroccan Assets
Irish Assets
Outlook MOROCCO Tendrara Lakbir Option
Scale • 14,548 sq. km. Over entire prospective Missour-Tendrara Basin • Largest licence in Morocco over the proven Triassic TAGI gas play • Material, near-development gas project – clear pathway to early monetisation • Favourable fiscal regime – 5% Government Royalty and 10 year holiday on corporation tax • “Running-room” provided by existing TAGI gas discoveries, prospects and leads; under- explored Palaeozoic prospectivity (extension of proven Algeria/Libya petroleum systems; unconventional Carboniferous & Silurian/Tannezuft shale gas: economics enhanced by TE-5 gas development)
Equity & Partners • Pathfinder Hydrocarbon Ventures Ltd 50% net equity after exercise of Exclusive Farmin Option • Partners: Oil and Gas Investments Funds (“OGIF”) 25%; ONHYM 25% • Pathfinder is the Technical Operator during Option Period • OGIF is owned by the largest Moroccan financial institutions (banking, insurance and pensions)
Deal Terms & Legacy Database • Legacy Database (available to licence holders only): 7 wells by previous operators; 488 sq. kms. of 3D seismic; 4,118 kms. of 2D seismic; PSDM processed 3D seismic and Reservoir Engineering (Pathfinder Option Period work programme) • Pay disproportionate share of two wells to be drilled on the TE-5 gas structure in the Initial Exploration and First Extension Periods of the Licence – Offers to reflect the materiality and “running room” and comprehensive legacy database - Well planning underway with drilling to commence within the next 9 months - Scoping budgetary estimate for individual wells, fully tested, is USD 13.5 - 17 MM • Assignment of equity interests are subject to the usual Moroccan government approvals www.fastnetoilandgas.com 9
MOROCCO Energy Prices and Fiscal Regime
• The gas and oil prices in Morocco are indexed to international prices.
• The gas price at the Morocco - Algerian border is 10 to 11 USD per a million BTU.
• The selling price of the produced gas from Moroccan wells is between 2 and 3 MAD/m3.
Indonesia Fiscal Incentives Norway • 25% State participation Egypt Libya • Royalty: Oil 10%; Gas 5% UK • 10 year corporate tax holiday on discovery Argentina Canada Morocco
0% 20% 40% 60% 80% 100%
Profit Value of 1bbl of Oil in Morocco Gov’t Take (%) • Producing 1bbl of oil in Morocco is equivalent to • 13bbl in Algeria • 7bbl in Nigeria
www.fastnetoilandgas.comSource: EY Global oil and gas tax guide, 2013 10 Morocco Algeria Nigeria Egypt MOROCCO African Gas-to-Power Opportunity
• Generation and transmission infrastructure shortfall in Africa
• Nigeria Population 170 Million and Generating Capacity of 4,000 MW
• By Comparison New York has a Generating Capacity of 13,000 MW
www.fastnetoilandgas.com Source: Marrakesh Conference May 2014 11 MOROCCO Gas-to-Power Opportunity
• 470 MW of Existing Gas Power Capacity in Morocco (Population 33 million)
• 4,000 MW Planned Increase in Gas Power Capacity (requiring 600 mm cfgpd)
• 367% Increase in Gas-Fired Electricity Generation Forecast by 2023
• Opportunity to supply new-build 400 MW Al Wahda Power Station
• TE-5 can deliver 60 mm cfgpd
www.fastnetoilandgas.com 12 MOROCCO Option to Export Excess Gas to European Market to Ease Security of Supply Issues (Russia-Ukraine)
• Capacity: 12.5 BCM/year (441.37 BCF/year)
• Installed Capacity: 18 BCM
• 14% of transport capacity entitled to Morocco
• 100% capacity rights to Morocco in 2021
• Transit fees for Morocco of 600 to 800 million m3/year
Pipeline building estimated costs • 20”: 1 million USD / km LNG Terminal Initial Capacity • 48”: 3 million USD / km (120 kms tie- 5 Billions M3 ( 176.55 BCF) back to Maghreb Pipeline) > 5 years before operational (at very early planning stage)
Source: CPR, November 2013
www.fastnetoilandgas.com 13 MOROCCO Tendrara Lakbir Exploration History: 6 wells discovered gas of 7 wells drilled
Legacy Prospectivity (2000-2008) Additional Untested Upside • TE-5 Gas Structure (red) • Cambro-Ordovician 488 sq. km. 3D & 4,110 kms. 2D seismic NE area of the Block 3 month EWT – no pressure depletion in TAGI I Formation damage – stabilised rate 1.5 mm cfgpd • Carboniferous
• SBK-1 Gas Discovery (red) Basinwide
TAGI II tested at 5 mm cfgpd Declined to 2.5 mm cfgpd (fault barrier/no 3D) • Unconventional Shale Gas Condensate shows in Lias dolomites & Trias basalts Carboniferous – basin centre play 300 bcf GIIP Best Estimate 62 TCF (Source ONHYM) Silurian/Tannezuft – NE area • TE-3 & TE-4 Structure (red hatched) TAGI tight gas reservoir Gas shows in Lias limestone and Carboniferous
• TE-2 Structure (red outline) NW-SE LINE OF SECTION TAGI tight gas reservoir Legacy 2D Seismic
• TAGI Prospects (yellow) Structural & Stratigraphic Pinchout
• TE-1 (1966) logged gas Possible downdip extension TE-5 Structure
www.fastnetoilandgas.com 14 MOROCCO Fastnet New TE-5 Unconventional NuTech Petrophysics TAGI-I Perforated Zone 2,588.5m-2,620m
• Identification from logs of higher permeability layers – calibrated to available core data
• Perforated zone tested only some of these: moderate gas flow rates (formation damage and liquid loading)
Res. Qual. Lith/Fluid Porosity Visual Vol. Analysis Textural Zone Flags Analysis Curves Matrix Por/Fluid Params Ratings Gamma Test Interval Resistivity Tot. Gas Pore Size Perm Comment Fracturing
Core k up to 55 mD Thin layers sub NuTech log resolution
“Sweet Spot” Better sorted NuTech Shows good k Not contributing to flow
www.fastnetoilandgas.com 15 MOROCCO Fastnet TAGI I Depth Map (At Seismic Reference Datum)
• Legacy 2D seismic P50 CLOSURE: 40 sq. km. processing (depth mapping GAS-DOWN-TO 2451 meters subsea Provisional TE-7 88 meters gross gas column in TE-5 Testing P50 40 sq. km. in progress on reprocessed No water leg encountered 1.4 TCF GIIP seismic data) Meskala Field pressure data supports single column
• TE-6 to test deliverability o and TE-7 to Test P50 GIIP Volumes
FAULT “A” MAY EXTEND ENE AS SHOWN BELOW
Provisional TE-6 Testing 10 sq. km. updip 350 BCF GIIP
o Fault “A”
TE-5 P90 35 BCF GIIP from EWT interpretation Radius of investigation < 1 sq. km.
TE-1 New Petrophysical Analysis www.fastnetoilandgas.com43.8 meters of gas pay now recognised 16 Upside to Extend TE-5 Gas Column 400 meters Downdip MOROCCO Fastnet Independent Reservoir Engineering Study
TE-5 Well – inflow Performance Rates
TE-6 Well to test well deliverability case “A” – 9mm cfgpd
A (Case “A” 9.1 mm cfgpd with all zones in 22.5m perforated; S = 0)
(EWT Well Test k – Only top 11.5m contributing; S = 0)
( Original Well Test k – Only top 11.5m contributing; S = 30)
www.fastnetoilandgas.com 17 MOROCCO Meskala Gas Field: On-Trend Producing TAGI I Gas Reservoir Analogue Supports TE-5 Gas Potential
Exploration History • MKL-101 Gas Discovery drilled in December 1981 – field on-stream in 1987 • TAGI Triassic reservoir (also tested gas in TE-5 gas structure – up to 14% porosity) • Gross reservoir section 150m with c. 30m net pay (less than TE-5) • Avg. porosity in best pay section 12% (k2-4 mD compared to up to 55 mD at TE-5 • Depth 3374 m (c. 750m shallower than TE-5)
TE-5 Gas MKL-101 Reservoir Characteristics and Test Results Structure • Over-pressured – 3700 psi above hydrostatic pressure (also over-pressured at TE-5) • 18m perforated (only 11.5m contributing to flow at TE-5) from 3374m – 3392m • No acidizing/no fracking Meskala • 20mm cfgpd absolute open-hole potential – stabilised at 6mm cfgpd and 510 BCPD Gas Feld on ¼” choke with WHFP 4800 psi (flow rate restricted by liquid condensation near well bore. Liquid content 85 barrels per mm cfgpd (3 barrels at Tendrara) • MKL-101 producing 3.24mm cfgpd and 200 BCPD after 27 years production life.
Reservoir Geometry • Good lateral continuity but fault compartmentalisation (less significant at TE-5) • Development wells drilled pre-3D – very poorly located
GIIP Per Well • MKL-101 fault compartment 33BCF and 2.8mm BC in-place per sq. km. • TE-5 independent estimates indicate a range of 8 to 20+ BCF recoverable per well for a variable net pay thickness of 135 to 200 feet and a drainage area of between 200 and 300 acres per well www.fastnetoilandgas.com Source: World Bank Report No. 4283-MOR 18 4 Apr 1983 MOROCCO Untested Unconventional Palaeozoic Hydrocarbon Plays
OSD-1 (Carboniferous) 62,214 TCF • TOC up to 11.44% at 2401m Missour Basin TENDRARA • Tmax 439° LICENCE OSD-1 • S2 187 mg/g • HI 163 • 800m+ thick TAJ-1 TAJ-1 (Silurian) • TOC up to 3.32% at 2729m • Tmax 348° • S2 1.31 mg/g Area : 11000 Km² • HI 39 Age : Carboniferous Maximum depth : • Avg. thickness 150m 4363 m TOC : 1 – 11.44 %
• Gas in Fractured Lower Devonian Lstn. at Meskala Field Distribution of Silurian • Carboniferous gas in some Tendrara wells Hot Shales: NW Africa • Potential for tectonic fracturing locally • Silica and clay content not investigated • Shale porosity not investigated • “Sweet spots” not yet identified
www.fastnetoilandgas.com Based on Legacy 2D Seismic Data 19 MOROCCO FA-1 Preliminary Well Post Mortem Shows Untested Potential
Pre-Drill Fastnet Post-Drill Fastnet Primary “Wedge” Primary “Wedge” Target Target Tagged but not Penetrated FA-1
SALT
Live Oil Shows
Flat Spot??
High Amplitude Package Recalibrate with Well Results www.fastnetoilandgas.com 20 MOROCCO FA-1 Sidewall Cores – Live Oil Under UV Light
Source: CoreLab www.fastnetoilandgas.com 21 MOROCCO Offshore Morocco Play Fairway Analysis
• FA-1 well trade value is being used to give valuable insight into an ongoing analysis of the potential of the under- explored offshore
• Deep Secondary Target favoured by Fastnet and a target for Chevron and BP offshore Nova Scotia remains a key target in Foum Assaka following the FA- 1 well
• Exploration drilling offshore Morocco FA-1 Well has historically focused on the Carbonate Shelf with no commercial discoveries as yet Analysis of 32 Wells drilled in Morocco
www.fastnetoilandgas.com 22 Company Overview
Moroccan Assets Company Overview Irish Assets
OutlookMoroccan Assets
Irish Assets
Outlook IRELAND Celtic Sea Offshore
Highly prospective basin capable of delivering significant near-term production
• Attractive petroleum geology with major reserves potential: largest producing gas field at Kinsale Head, large prospects with well- understood large-field analogues and existing infrastructure • Underexplored, applying new technologies to de-risk by analogy with surrounding oil and gas discoveries • Shallow water prospects: easier to monetise than deepwater Irish Atlantic Margin • Largest ever 3D seismic survey undertaken in Summer 2013 (1,910km2) DEEP MOLLY MIZZEN & SHANAGARRY BLOCK 49/13 KINSALE MALONE Mizzen East - Mizzen 1,400km2 2 2 2 2 2 - Kinsale 510km2 AREA 285 km 648 km 1942 km 881 km 272 km WATER DEPTH c. 100 m c. 100 m c. 100 m c. 100 m c. 100 m FASTNET INTEREST 60% 100% 100% 82.35% 85% www.fastnetoilandgas.com 24 IRELAND Fastnet Identifies New Unexplored Celtic Sea Frontier Basin with Geology Analogous to the Flemish Pass Basin, Eastern Canada
• Statoil Discovery of up to 600 MBO Recoverable made in summer 2013 Mizzen Basin
Charlie Gibbs FZ
CGFZ Splay
Qualitative Interpretation – AOI + HP100km Bouguer www.fastnetoilandgas.com 25 IRELAND NEW 3D Seismic Defines Potential Gas Chimneys and Escape in Chalk (Compare Danish North Sea) and Multiple Gas-related Amplitude Anomalies
Gas Chimney?
Bright Spots
Primary Prospect “A” Chalk
Stratigraphic Prospect “B”
TDW 40 Aptian TDW 50 Barremian Higher amplitude events (Clastics?) www.fastnetoilandgas.com 26 IRELAND New 3D Seismic Defines Large Potential Gas Anomaly Over Primary Prospect “A” – 91.9 sq. km. giving 1.45 (P50) to 2 (P10) TCF of Recoverable Gas
RMS Amplitude Extraction, TDW 40 mins 100ms
Basis for Maximum closure Inline 728 at Primary Prospect A
High amplitudes over crest
www.fastnetoilandgas.com 27 Inline 728 IRELAND New 3D Seismic Defines Large Potential Gas Anomaly Over Stratigraphic Prospect “B” – 138.5 sq. km.
15 Hz spectral decomposition in 125ms window below Top Aptian showing wedging of potentially gas charged reservoirs on to high.. Theory indicates higher frequencies are preferentially Stratigraphic Prospect “B” removed by gas sands leaving an Covering 138.5 sq. km. elevated low frequency response Pinchout
Gas Gas
www.fastnetoilandgas.com 28 IRELAND Options to Develop Mizzen Gas
Commercial Considerations • Kinsale route avoids major planning delays and accelerates First Gas 34 kms to connect to • Considerable CAPEX investment required to upgrade onshore gas infrastructure Kinsale Platforms • Non-ownership of infrastructure increases Opex and 155 kms to Bantry Bay Oil creates tariffing issues Terminal Infrastructure
Kinsale Assumptions • Wet Gas Processing at Mizzen • No onshore processing – less jobs • 300mm cfgpd pipeline throughout • Sufficient existing compressors? 185 kms to connect to Kinsale • Platform space for new riser? Platform and Shore Terminal • First Gas Q4 2019 • Existing production life Kinsale?
Mizzen Assumptions • Dry Gas or Wet Gas processing at Mizzen • Subsea development or mini-platform • 1-2 TCF discovery • 300mm cfgpd plateau production • Option for onshore gas processing – more jobs gas terminal at Bantry • First Gas Q4 2019 www.fastnetoilandgas.com 29 IRELAND Deep Kinsale - Large Untested Closure Below Shallow Producing Gas Field
North South East
Northern Bounding Fault Kinsale Field 1.7 TCF Gas Southern Bounding Fault Base Chalk
Deep Kinsale Approx. Licence Primary Limit (4000ft) Prospect “A”
Middle Wealden
Mounding in Prospect E Upper Purbeck 48/25-1 Discovery MFS Reservoir Prone
Upper Purbeck Sands Source
North Potential reservoir bearing packages thicken into active Late Jurassic to Early Cretaceous Faults
Upper Jurassic
SE
49/9-2 “Helvick” Oil & Gas Play
Upper-Middle Jurassic www.fastnetoilandgas.com Deep Liassic Source? 30 IRELAND Deep Kinsale – New 3D Seismic De-risk Potential Untested Thicker Sand Intervals
North South East
Northern Bounding Fault
Southern Bounding Fault Base Chalk
Deep Kinsale Prospect A
Middle Wealden
Mounding in Prospect E Upper Purbeck Prospect K
Upper Purbeck Purbeck Shale Sands
North
Upper Jurassic
49/9-2 “Helvick” Oil & Gas Play SE www.fastnetoilandgas.comUpper-Middle Jurassic 31 IRELAND NuTech Data Unconventional Petrophysics for 48/25-1
48/25-1 Logged 532 feet of net oil pay The Lower Wealden interval from 6600-7060ft is sst with 270 feet of net pay. The characteristics of this interval are: average porosity of 15.3%, average SW of 43.3%, average permeability of 114 millidarcies, There are
several zones with permeability above several hundred Seal Interval millidarcies. This interval is expected to produce Oil-Bearing hydrocarbon at a good rate.
The Upper Purbeck interval from 7060-7600 feet is sst. with 262ft of net pay. With average porosity of 12.5%, average SW of 36.9%, average permeability of 45.6 millidarcies, There are several zones with permeability Upper Purbeck – Lower Wealden over several hundred millidarcies. This interval is Reservoir expected to produce hydrocarbon at a fair to good Interval rate.
Mid Purbeck Lacustrine Source Rock www.fastnetoilandgas.com 32 IRELAND P50 Closure for Upper Purbeck Sands Primary Prospect “A” – 46 sq. km. 273 (P50) to 630 (P10) MBO Recoverable – P10 Case 192 sq. km.
Primary Prospect “A” Upper Purbeck 46km²
Logged Live Oil 48/25-1 262 feet net oil pay
www.fastnetoilandgas.com 33 IRELAND NuTech Data Unconventional Petrophysics for 48/25-1
48/23-1 48/24-3 48/25-1
Seal Interval
Lower Wealden Reservoir Interval
Good Continuity of Barryroe Tested Sands Over 10’s of Kilometres
Upper Purbeck Lacustrine Shale Reservoirs in Deep Kinsale www.fastnetoilandgas.com 34 IRELAND 3D Seismic De-risk Legacy Reservoir Compartmentalisation Issues
Primary Prospect “A” Basal Wealden 46 sq. km.
48/25-1 Oil Discovery Lower Wealden 46.7 sq. km.
Logged Live Oil 48/25-1 270 feet net oil pay
www.fastnetoilandgas.com 35 IRELAND Deep Kinsale – Oil Development Scenarios
Sea Nova Jack-Up Example (Reusable Platform) • Optimum Pilot Development Solution
• Capex Friendly
• Wet Gas Processing Topsides
• Deviated dry wells from platform
• Provides long term reservoir flow assurance
• Reusable – move to other parts of the field
www.fastnetoilandgas.com 36 Company Overview
Moroccan Assets
Irish Assets
Outlook
www.fastnetoilandgas.com 37 OUTLOOK Forward Work Programme
2014 2015 Prospect Activity Q2 Q3 Q4 Q1 Q2 Q3 Q4 ONSHORE Farmout MOROCCO Exercising Option Agreement (Dec 2014)
Rig contract (Tendrara Lakbir) Drilling preparation EIS Study
Complete seismic pre-stack depth migration
mature prospect portfolio
Drill first appraisal well
Drill second non obligatory appraisal well/POD submission OFFSHORE Drill first well MOROCCO Evaluate FA-1 well results (Foum Assaka) Drill second FA-1 carried well subject to partners approving location & timing
Evaluate well results
OFFSHORE Celtic Sea Farmout/workshop IRELAND (Joint Initiative by Celtic Sea operators) 3D Seismic Interpretation/AVO Processing (Celtic Sea) Stage 1 & Stage 2 Farmouts
Multi-Well programme planning for 2016 www.fastnetoilandgas.com 38 OUTLOOK Near Term Share Price Catalysts
• Healthy cash balances funds all current phase licensing commitments – no financing pressures
• Prospect Portfolio matured to a stage where material primary drilling targets have been de-risked to industry standards of risk through value-adding seismic acquisition, reprocessing and desk top studies
Tendrara Lakbir • Large gas discovery appraisal project with early monetisation potential Onshore Morocco • 3D seismic reprocessing and reservoir engineering study successfully de-risks legacy reservoir continuity and flow assurance issues – attractive to farminees Deep Kinsale • Large oil appraisal and exploration prospects • Legacy compartmentalisation and reservoir development issue successfully addressed by 3D Celtic Sea seismic – previously held back farmout success
Mizzen Prospect • Super-large exploration prospect in emerging new frontier basin Celtic Sea • 3D seismic de-risks presence of gas-change
• Farmout processes for onshore Morocco and Celtic Sea progressing very well with 9 front runners at the table reflecting a change in exploration investment strategy to lower capex onshore and shallow water projects in areas of proven hydrocarbons • Up to USD 22m in past costs receivable follow completion of a Celtic Sea farmout • Disproportionate share of costs of two Tendrara 2015 gas appraisal wells and past costs on completion of a farmout (strategic JV partner sufficiently qualified to carry project through to gas development and monetisation) • Fastnet has a proven farmout track record securing a carry of up to 2 wells in Foum Assaka & USD 20.4mm in back costs
• Near-term Tendrara low risk drilling and potential for early monetisation would be transformational for Fastnet as the export route to Europe assumes greater significance in order to mitigate against long-term dependency on Russian gas www.fastnetoilandgas.com 39 Fastnet Oil & Gas Appendices
Appendices
www.fastnetoilandgas.com 40 Fastnet Oil and Gas PLC
Executive Directors Non - Executive Directors
Cathal Friel Paul Griffiths Carol Law Will Holland Michael Michael Executive Managing Executive Chief Financial Nolan Edelson Chairman Director Director Officer
Robert Murphy* Christian Klinkenberg John Tingas* Ross Crockett Paul Griggs* Brendan Senior Project Commercial & Operations Reservoir Finance and Commercial Tuohy* Geologist Manager Engineer Back Office Contracts Licensing Support Advisor Consultant Dr. Vivian Caston* Michael Lynch Bob Graham* Technical Advisor Investor Relations Consulting Manager Geophysicist
Moroccan Focused Team
Armira Zylyftari Dr. Mahmoud Zizi Carl Kindinger* Dennis Krahn* Licence Morocco Country UK based Commercial Morocco Drilling Administration Manager / Financial Consultant Manager
www.fastnetoilandgas.com *Consultants and Advisors for specific projects only 41 APPENDIX Frontier Exploration Asset Overview
Strategic focus on high-volume, high- value, frontier petroleum systems
Fastnet Interest Licence Name Region Area Partner Operator Gross Net Tendrara Lakbir Onshore Morocco 14,548 km2 66.7% 50% ONHYM, OGIF Fastnet Foum Assaka Offshore Morocco 6,478 km2 12.5% 9.375% Kosmos, BP, SK Kosmos Mizzen Basin Offshore Ireland 787 km2 100% 100% n/a Fastnet Mizzen East Offshore Ireland 1,155 km2 100% 100% n/a Fastnet Deep Kinsale Offshore Ireland 285 km2 60% 60% PETRONAS Fastnet Shanagarry Offshore Ireland 881 km2 82.35% 82.35% Adriatic Oil, Carob, Petro Celtex Fastnet Molly Malone Offshore Ireland 647 km2 100% 100% n/a Fastnet Block 49/13 Offshore Ireland 272 km2 85% 85% Carob ltd, Petro Celtex Fastnet Total Area 25,053 km2
Average Commercial Discovery Size in MMBoe 2010-2012 by Type of Hydrocarbon Province
Mature 95
Standard 283
Frontier 771
0 100 200 300 400 500 600 700 800 Note: Information from September 2012 Bernstein Research Report www.fastnetoilandgas.com 42 MOROCCO: FOUM ASSAKA Fastnet farm-out agreement with SK Innovation
About SK Deal Terms
• SK Innovation is part of SK Group, the third largest • SK acquired a 12.5% Gross interest (9.375% Net) in Foum conglomerate in South Korea behind Samsung and Assaka licence in December 2013 Hyundai with 56,000 employees • Up to two well carry comprised of a carry in the first • USD $130 billion in Annual Revenue exploration well on the Eagle-1 Prospect and first appraisal (Energy/Chemicals Division comprises 56%) well (capped at USD $100 million per well) or at SK Innovations’ discretion a carry in a second exploration well (capped at gross USD $100 million) • SK is Korea’s number one and Asia’s fourth largest oil refining company with 1.1 million boepd capacity • Reimbursement of past costs of USD $3.2 million and a further payment of 25% of Fastnet’s back costs relating to • As of Q1 14, SK’s E&P portfolio consists of 19 blocks the period from 1 October to 1 January 2014 in 13 countries
– 5 production blocks, 14 exploration blocks, 4 LNG projects across countries such as Peru, Columbia, • Fastnet now retains a 12.5% gross interest (9.375% - net) Kazakhstan, Libya, Australia, Oman Yemen, Vietnam, Cote d’Ivoire, Madagascar – Daily production of 70,000 boepd – 619mm BOE Proven Reserves
www.fastnetoilandgas.com 43 FASTNET PORTFOLIO Gross STOIIP and GIIP and Risking based on CPRs as of 31.12.2013 (before
interpretation of new Celtic Sea 3D seismic) Contingent Resources
Best Estimate High Case CoS Oil or Gas Case
Foum Assaka Shell Legacy Prospects Only 4.930 BBO – 11% OIL Tendrara Lakbir TE-5 Lakbir Structure 310.5 BCF 0.892 TCF 22% GAS Other Prospects and Leads 1, 345.8 BCF 4.284 TCF 11 - 18% GAS Shanagarry
Upper Wealden 135.9 BCF – 10% GAS Lower Wealden 796.6 MMBO – 14% OIL Purbeck 501.6 MMBO – 12% OIL Kimmeridgian-Portlandian 885.7 BCF – 5% GAS Upper/Middle Jurassic 321.1 BCF – 5% GAS Mizzen Basin Shallow Lower Cretaceous 2.075 TCF 4.724 TCF 12% GAS Cretaceous Prospect 1.799 BBO 3.899 BBO 4% OIL Deep Triassic Prospect 3.108 TCF 9.356 TCF 5% GAS Molly Malone Basin Triassic Prospect - North 6.677 BBO – 9% OIL Triassic Prospect - South 5.833 BBO – 5% OIL
Deep Kinsale Wealden Oil 1651.4 MMBO 3.306 BBO 15% OIL Purbeck 713.6 MMBO 1.556 BBO 15% OIL www.fastnetoilandgas.comTotal Oil 22.911 BBO OIL 44 Total Gas 8.182 TCF GAS APPENDIX Analyst Coverage
Name Company
Harry Stevenson Beaufort Securities
Sam Wahab Cantor Fitzgerald Job Langbroek Davy
Ian McLelland Edison Research
Tao Ly GMP Securities
Gerry Hennigan Goodbody
Richard Savage Mirabaud
Stuart Amor RFC Ambrian
Craig Howie Shore Capital
www.fastnetoilandgas.com 45