investor presentation april 2014 for personal use only · investor presentation april 2014 for...

FAR’s African story is unfolding

Investor presentation April 2014

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Disclaimer

• This presentation has been prepared by FAR Limited (“FAR”). It should not be considered as an offer or invitation to subscribe for or purchase any shares in FAR or as an inducement to make an offer or invitation with respect to those securities. No agreement to subscribe for shares in FAR will be entered into on the basis of this presentation.

• This presentation contains forward-looking statements that are not based on historical fact, including those identified by the use of forward-looking terminology containing such words as “believes”, “may”, “will”, “estimates”, “continue”, “anticipates”, “intends”, “expects”, “should”, “schedule”, “program”, “potential” or the negatives thereof and words of similar import.

• FAR cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual events or results to differ materially from those expressed or implied by the statements. The forward looking statements are expressly subject to this caution. FAR makes no representation, warranty (express or implied), or assurance as to the completeness or accuracy of these forward-looking statements and, accordingly, expresses no opinion or any other form of assurance regarding them. FAR will not necessarily publish updates or revisions of these forward-looking statements to reflect FAR’s circumstances after the date hereof.

• By its very nature exploration and development of oil and gas is high risk and is not suitable for certain investors. FAR shares are a speculative investment. There are a number of risks, both specific to FAR and of a general nature which may affect the future operating and financial performance of FAR and the value of an investment in FAR including and not limited to economic conditions, stock market fluctuations, oil and gas demand and price movements, regional infrastructure constraints, securing drilling rigs, timing of approvals from relevant authorities, regulatory risks, operational risks, reliance on key personnel, foreign currency fluctuations, and regional geopolitical risks.

• This presentation does not purport to be all inclusive or to contain all information which you may require in order to make an informed assessment of the Company’s prospects. You should conduct your own investigation, perform your own analysis, and seek your own advice from your professional adviser before making any investment decision.

• Cautionary Statement for Prospective Resource Estimates – With respect to the Prospective Resource estimates contained within this report, it should be noted that the estimated quantities of Petroleum that may potentially be recovered by the future application of a development project may relate to undiscovered accumulations. These estimates have an associated risk of discovery and risk of development. Further exploration and appraisal is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.

• Information in this report relating to hydrocarbon resource estimates has been compiled by Peter Nicholls, the FAR exploration manager. Mr Nicholls has over 30 years of experience in petroleum geophysics and geology and is a member of the American Association of Petroleum Geology, the Society of Exploration Geophysicists and the Petroleum Exploration Society of Australia. Mr Nicholls consents to the inclusion of the information in this report relating to hydrocarbon Prospective Resources in the form and context in which it appears. The Prospective Resource estimates contained in this report are in accordance with the standard definitions set out by the Society of Petroleum Engineers, Petroleum Resource Management System.

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Investment highlights

• West and East Africa exploration focus

• 8.5+ billion barrel prospect inventory*

• Funded for 3 wells commencing April 2014 : Gross farmout value ~US$230M

• Testing approximately 1.5 bbbls* prospective resources commencing April

• Partners for drilling with Cairn Energy, ConocoPhillips, Milio International

• 5 wells to be drilled in next 12 months

• Approximately $28M cash

• Significant upside potential in portfolio

• Healthy pipeline of projects

• Board with significant E&P experience

*Reference ASX releases dated 27 Feb 2013, 5 Feb 2014, 11 Mar 2014, best estimate, gross, unrisked prospective resources, 100% basis, oil only

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Corporate snapshot

Capital Structure

ASX Ticker FAR

Shares on issue 2,499,846,742

Share price* A$0.058

Market capitalisation* A$145M

Cash and term deposits (approx)* A$28M

Board & management

Nicholas Limb, Non-Executive Chairman

Catherine Norman, Managing Director

Ben Clube, Executive Director and Commercial Manager

Charles Cavness, Non-Executive Director

Albert Brindal, Non-Executive Director

*As at 28 March 2014

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Unexplored frontier Billion barrel potential

Senegal

Multiple prospects Expansive acreage

AGC Profond

Sinapa discovery Drill ready

Guinea-Bissau

Exciting frontier Large equity positions

Kenya

• 9 exploration licenses in 3 West and East African countries, combined 31,400 km2 area

• 2 wells with Cairn and ConocoPhillips offshore Senegal commencing April 2014

Exposure to world class emerging O&G areas

*Reference ASX releases dated 27 Feb 2013, 5 Feb 2014, 11 Mar 2014, best estimate, gross, unrisked prospective resources, 100% basis, oil only

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FAR’s prospects in offshore West Africa

Strong acreage position in Senegal, Guinea Bissau & AGC Profond

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• Funded through drilling of two wells

• Drilling commencing April 2014

• Partners are Cairn Energy (40%) and ConocoPhillips (35%)

• Approx US$200M to be spent on drilling

• FAR received US$10M in cash

• Testing 1.5 billion barrels of oil in two wells, 225 million barrels net to FAR*

• Size of total prize pool 3.5 billion barrels oil, 525 million barrels net to FAR*

Senegal

RUFISQUE, SANGOMAR & SANGOMAR DEEP OFFSHORE 16.7% paying interest, 15% beneficial interest Operator: Cairn Energy PLC

*From FAR internal prospective resources 27 Feb 2013, best estimate, gross, unrisked prospective resources, 100% basis, oil only

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• Petroleum system established – Rufisque Dome

• World class source rocks

• Drilling shelf edge and deepwater fan

• 550 million barrels* in shelf well (SNE-1)

• 900 million barrels* in deepwater fan well (FAN-1)

• 3.5 billion barrel1 follow up potential in success case

Senegal: Prospects and Leads summary


FAN-1 well

SNE-1 well

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• First well: Fan prospects, spudding April, 65 days to TD

• Second well: Shelf prospects, spudding June, 45 days to TD

Senegal: Where are we drilling?

FAN-1 1500m WD 5300m TD

SNE-1 1000m WD 3300m TD

Source kitchen

West East

Oil Traps

Oil Migration

Buried Hills Play

Albian Clastic Play

Aptian Carbonate Play

Campanian-Maastrichtian Fan Play

Santonian Fan Play

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Senegal

• Operator (Cairn Energy PLC) currently completing second of two wells offshore Morocco with the Cajun Express rig

• The first of two Senegal wells will spud in April 2014

• Testing approximately 1.5 billion barrels of prospective resources*

• Significant follow-up potential on success

Rig has been mobilised and has commenced drilling operations

*Unrisked best estimate, 100% basis as per FAR ASX release dated 27 February 2013

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Guinea-Bissau and AGC

SENEGAL

GUINEA BISSAU

2

5A 4A

BLOCKS 2, 4A & 5A 15% interest Operator: Svenska Petroleum

AGC PROFOND 8.8% interest Operator: Ophir Energy PLC

• One block in AGC, three blocks offshore Guinea Bissau

• Large permit area > 15,000 km2

• Large upside exposure in Senegal success case

• Attractive low risk inboard salt plays identified

• Proven oil-prone basin

• 1 billion barrels prospective resources identified offshore Guinea Bissau*

• Sinapa West appraisal planned in March 2015

• Multiple follow up prospects on success

• Completing technical review and undertaking permit negotiations in AGC Profond

* Unrisked best estimate, 100% basis as per FAR ASX release dated 4 February 2014

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FAR’s prospects in East Africa

Large equity in fast emerging oil and gas province

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0 50

Km

Kubwa-1

Kiboko-1 Sunbird-1

Mbawa-1

Kifaru Kifaru West

Tembo

L6

L9

Kenya BLOCK L6 60% interest offshore 24% interest onshore Operator: FAR Limited

BLOCK L9 30% interest Operator: Ophir Energy PLC

• Proven oil at both ends of the kitchen

• Continuous reef trend

• Drill ready prospects defined on 3D seismic

• Encouragement from recent drilling

• BG recently completed Sunbird-1 well in Block 10A

• Hydrocarbon column

• Returned hydrocarbons to surface

• High porosity and permeability

• Fully carried through the acquisition of 1000kms 2D seismic and one onshore well in Block L6 by Milio International of Dubai (~US$30M program)

• Awaiting Gvt approval for transfer of equity to FAR for L9*, JV work program to be decided

• Actively farming down offshore well in Block L6 and L9

Eocene Fan prospects

Eocene Clastic prospects

Miocene Reef prospects

Other prospects/leads

Discovery

Cretaceous Clastic prospects

* Reference FAR ASX Dec quarter report dated 31 January 2014

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Kifaru West Kifaru

Kenya Block L6 : Reefal prospects

Miocene reef play prospective resources*

Kifaru prospect 178 mmbbls

Kifaru West prospect 130 mmbbls

Other total 1,249 mmbbls

Total 1,557 mmbbls

Total net to FAR 934.2 mmbbls


NE SW

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A busy year ahead

This timetable is indicative and final timetable will be determined when government approvals, availability of rigs and seismic vessels are confirmed

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun





SENEGAL Sangomar Profond

KENYA L6

KENYA L9

GUINEA BISSAU Blocks 2, 4A & 5A

Australia NWS

Drill Planning

Evaluation of Drilling

Drilling

Farmout Drill Planning Drilling

BG/Anadarko

Onshore Seismic Acquisition & Processing Evaluation of Drilling

Farmout Drilling

Drill Planning Evaluation of Drilling

Drill Planning

Drilling Evaluation of Drilling

G &G 3D Seismic Acquisition & Processing

2014 2015

Drilling

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Approximately $28M cash

5 wells to be drilled in next 12 months…

3 free carried wells in program totaling approximately $220M

2 wells commencing April 2014 targeting 1.5billion barrels of oil

Plan to expand the portfolio of opportunities through new ventures

FAR’s African story is unfolding F

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Contact us

Cath Norman Managing Director Level 17, 530 Collins Street Melbourne VIC 3000 Australia T: +61 3 9618 2550 www.far.com.au

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Appendices

*As at 18 November 2013

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Senegal: Planned FAN-1 well

West East

Approximate North Fan Well location

North Fan prospect prospective resources*

North Fan (H 82) 117 mmbbls




Total 632 mmbbls

Total net to FAR 95 mmbbls


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Senegal: Planned SNE-1 well

Albian sands objective Albian Amplitude Extraction Shelf prospect prospective resources*

Albian sands 154 mmbbls

Aptian carbonates 491 mmbbls

Total 645 mmbbls

Total net to FAR 97 mmbbls

Aptian carbonates objective


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SENEGAL

GUINEA BISSAU

2

5A 4A

AGC PROFOND 8.8% interest Operator: Ophir Energy PLC

Guinea-Bissau

* Unrisked best estimate, 100% basis as per FAR ASX release dated 4 February 2014

Block 2 and Blocks 4A/5A prospects

• 2 discoveries made on block : low oil price (Sinapa - Premier 2004 and PGO 3 Exxon 1969)

• Sinapa West appraisal planned in March 2015

Guinea Bissau Contingent and Prospective resources*

Low estimate Best estimate High estimate

Sinapa Discovery 2C contingent resources

4.4 13.4 38.9

Total 2C contingent resources

4.4 13.4 38.9

Total net to FAR 2C contingent resources

0.7 2.0 5.8

East Sinapa prospect 1.8 7.5 34.2

West Sinapa prospect 17.7 64.4 251.7

Atum prospect 144.0 471.7 1,569.6

North Solah prospect 6.0 28.4 131.6

Arinca prospect 10.0 59.2 393.0

Sabayon prospect 3.4 18.1 88.2

Other leads Prospective resources

85.4 303.7 1,032.0

Total Prospective resources

269 954.0 3,500.0

Total net to FAR Prospective resources

40.0 143.0 525.0

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• 13.4 mmbbls 2C contingent resource in Sinapa Discovery*

• Combined contingent and prospective resource 85.6 mmbbls* potential in Sinapa Project

• Upside potential of >300 mmbbls*

• Appraisal well (Q1 2015)

• High chance of success at 36%*

• Well cost US$37M; (~US$8M net to FAR)

Guinea-Bissau – Sinapa discovery

Sinapa Discovery

* Reference FAR ASX release dated 4 February 2014

West Sinapa Prospect

Depth map and seismic image showing the Sinapa discovery and West Sinapa prospect

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Onshore

• Farmout deal concluded with Milio International

• Fully carried on 2D seismic and well (uncapped)

• Program to commence mid 2014

• FAR retains 24% carried equity

• Onshore gas development potential

Offshore

• Drillable prospects defined on 3D seismic

• Identification of new Miocene reef play drilled by BG in early 2014 : Sunbird-1

• 3.7 billion barrel oil prospectivity* in block

• Shallow water < 350m

• Kifaru prospect: 178 million barrels oil*

• Tembo prospect: 327 million barrels oil*

• Multiple follow drill targets in success case

• FAR retains 60% equity

Kenya Block L6 : Prospects and leads

*From FAR prospective resources 27 Feb 2013. Best estimate, unrisked prospective resources , 100% basis, oil or gas

BLOCK L6 Onshore 24% interest (following Government consent) Operator: FAR Limited

BLOCK L6 Offshore 60% interest Operator: FAR Limited

Miocene reefs

Eocene clastics

Cretaceous clastics

Miocene fans

Kifaru 3D Survey

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Maridadi-1B

Kenya Block L6 : Maridadi well result F

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Reservoir

Oil Shows

Maridadi-1B

Seal

Kenya Block L6 : Maridadi well result F

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Cross section through Lamu Basin

1000

6000

5000

4000

3000

2000

8000

7000

9000

S

S

S

Cretaceous

L6 L8 L7

Davey Walu High

Tertiary

Jurassic

Turbidites

Delta sands

Reefs

Kubwa Mbawa Depth Sunbird (Kifaru)

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Kenya: Community relations

Collecting data for the Environmental Impact Assessment Locating the Kipini-1 wellhead

Mark Jenkins addressing a local community along the coast Community awareness program, coast of Kenya

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FAR’s prospects in offshore Western Australia

• Proven oil and gas province of NW Shelf

• Shallow water

• Low risk, low cost exploration

• New 3D seismic in 2014

• 100% interest in two blocks

• 450 million boe prospective resources*

* Best estimate, gross, unrisked prospective resources, 100% basis, as per ASX release dated 11/3/2014

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https://www.google.com.au/url?sa=i&rct=j&q=&esrc=s&source=images&cd=&cad=rja&docid=jqC6vSVjMQQheM&tbnid=O6qqjiSVpEMQ8M:&ved=0CAUQjRw&url=https://www.fleetmon.com/vessels/Geo_Caspian_2031464&ei=ursSU5TPHsfSkwXVx4DwAQ&bvm=bv.62286460,d.dGI&psig=AFQjCNGANAl9VpuLmbl4a9Ej8SbImcr1DQ&ust=1393822507584836

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• Oil-prone area

• New play concepts with amplitude support

• Leads and prospects mapped in proven reservoirs

• 360 mmbbls* prospective resources

WA-458-P Dampier Basin

* Best estimate, gross, unrisked prospective resources, 100% basis, oil only, as per ASX release dated 11/3/2014

WA-458-P Prospective resources*

Top Angel play 20.7 mmbbls

Lower Angel structural play 5.8 mmbbls

Lower Angel stratigraphic play 152.2 mmbbls

Oxfordian fan 126.8 mmbbls

Legendre formation play 53.4 mmbbls

Total 358.9 mmbbls

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Dampier-1

• Underexplored : Dampier prospect a four way dip closure

• Modern seismic data has potential to locate the main sand fairways

• Potential for 185 mmbbls* in Dampier closure

WA-457-P Dampier Basin

* Best estimate, gross, unrisked prospective resources, 100% basis, as per ASX release dated 11/3/2014

WA-457-P Prospective resources*

Prospect Play Whole

Prospect Net to FAR

(within WA-457-P)

Dampier Angel Formation Gas (bcf) 799.2 458.5

Condensate (mmbbls)

16 9.2

Total mmBOE 153.8 88.2

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Board with significant E&P experience

Nicholas Limb

Non-Executive Chairman

Appointed 2012

Geophysicist and investment banker

15 years as MD/Chairman of an ASX listed, international mining company, Australia.

10 years in Financial services with May and Mellor and HSBC. 35 years industry experience in the

resources industry.

Catherine Norman

Managing Director

Appointed Nov 2011

Geophysicist

6 years as MD of Flow Energy Limited. 10 years as Managing Director of international oil services company

in the UK developing projects in Europe, Africa and the Middle East region. 27 years experience in the

resources industry.

Ben Clube

Executive Director and

Commercial Manager

Appointed 2013

Geologist and Chartered Accountant

26 years of experience in the resource sector. Senior Finance Executive BHP Petroleum where he held

roles across the full life cycle of exploration, development and operations. Finance Director and Company

Secretary of Oilex Ltd prior to joining FAR.

Charles Cavness

Non-Executive Director

Appointed 1994

Attorney at law

Served in the legal departments of two large American oil companies, Penzoil Corporation and Arco.

He has spent his entire career in the oil industry and consequently has experience in the United States,

Latin America and the Middle East. 35 years experience in the oil sector.

Albert Brindal

Non-Executive Director

Appointed 2007

Fellow Certified Practising Accountant

Director of the Company since 2007 and served as the Company Secretary since 2000.

Broad commercial experience and Chairman of Remuneration Committee.

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