riu good oil conference - asx · 11-09-2019 · • this presentation does not constitute...

warregoenergy.comwarregoenergy.com

RIU Good Oil ConferenceDavid CaseyCEO - Australia & Asia Pacific

11 September 2019For

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Disclaimer

• This presentation does not constitute investment advice. Neither thispresentation nor the information contained in it constitutes an offer, invitation,solicitation or recommendation in relation to the purchase or sale of shares inany jurisdiction.

• Shareholders should not rely on this presentation. This presentation does nottake into account any person's particular investment objectives, financialresources or other relevant circumstances and the opinions andrecommendations in this presentation are not intended to representrecommendations of particular investments to particular persons. All securitiestransactions involve risks, which include, among others, the risk of adverse orunanticipated market, financial or political developments.

• The information set out in this presentation does not purport to be all inclusiveor to contain all the information which its recipients may require in order tomake an informed assessment of Warrego Energy (‘Warrego’ or the‘Company’). You should conduct your own investigations and perform your ownanalysis in order to satisfy yourself as to the accuracy and completeness of theinformation, statements and opinions contained in this presentation.

• To the fullest extent permitted by law, the Company does not make anyrepresentation or warranty, express or implied, as to the accuracy, fairness orcompleteness of any information, statements, opinions, estimates, forecasts orother representations contained in this presentation. No responsibility or liabilityfor any errors, omissions or miss-statements from this presentation arising outof negligence or otherwise is accepted by the Company or its directors,employees or advisors or any other person.

• This presentation may include forward looking statements. Forward lookingstatements are only predictions and are subject to known and unknown risks,uncertainties and assumptions which are outside the control of Warrego. Theserisks, uncertainties and assumptions include commodity prices, currencyfluctuations, economic and financial market conditions in various countries andregions, environmental risks and legislative, fiscal or regulatory developments,political risks, project delay or advancement, approvals and cost estimates.Actual values, results or events may be materially different to those expressedor implied in this presentation. Given these uncertainties, readers are cautionednot to place reliance on forward looking statements and nothing should berelied on as a promise or representation as to the future. Accordingly, neitherthe Company or its directors, employees or advisors or any other person shallbe liable for any direct, indirect or consequential loss or damage suffered byany person as a result of relying on any statement in or omission from thepresentation or any other connected written or oral communication.

• Any forward looking statements in this presentation speak only at the date ofissue of this presentation. Subject to any continuing obligations underapplicable law and the ASX Listing Rules, Warrego does not undertake anyobligation to update or revise any information or any of the forward lookingstatements in this presentation or any changes in events, conditions orcircumstances on which any such forward looking statement is based.

Important Notice

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• 2007 - Warrego Energy Ltd UK founded by Dennis Donald & Duncan MacNiven

• 2008 - Secured EP469 in the Onshore Perth Basin, WA

• 2013 - Initial farm out of 80% of EP469

• 2014 - 3D seismic completed over one third of EP469

• 2015 - Reacquired 100% of EP469

• 2018 - Farmed out 50% of EP469 and Operatorship to Strike Energy

• March 2019 - WGO listed on ASX via RTO of Petrel Energy; gained acreage in Spain (Tesorillo) and Perth Basin (EPA-0127)

• August 2019 - Major gas discoveries in Kingia and Wagina announced

• September 2019 - Major gas discovery in High Cliff Sands announced

A brief history of Warrego Energy

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More than a decade of experience in the onshore Perth Basin

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Capital Structure

Company overview

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Cash: ~$7.3 million (June Qtrly)

Issued Cap: 631 million shares

Options: 7 million @ 12.4c

Unissued Founder Shares: 43 million

Market Cap: $202 million1

No Debt

1. Undiluted market cap at ~$0.32 share price

Insider ShareholdersDennis Donald 19.9% Co-Founder & MD

Duncan MacNiven 19.9% Co-Founder, Exec Dir

Greg Columbus 4.8% Non-exec Chairman

Owain Franks 3.0% Exec Dir

Mark Routh 2.3% Non-exec Dir

David Casey 1.2% CEO - Aust. & APAC

David Biggs <1% Non-exec Dir

Warrego Energy Limited is listed on the ASX with offices in Sydney and the UK

Clean and unencumbered balance sheet, excellent drill ready asset portfolio and experienced Board and Management

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WGO performance post ASX listingWarrego Shares have traded up significantly, driven by appraisal success at West Erregulla

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Major success in the Perth BasinDefining the PrizeF

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• Following the Waitsia discovery, the onshore Perth Basin has re-emerged as one of the most exciting areas in Australia for gas exploration

• Region is well serviced by gas infrastructure, production and storage facilities, and skilled labour

• AWE sold for $602 million in 2018; Waitsia (50%) represented 83% of AWE’s 2P Reserves

• Warrego holds a 50% non-operated interest in EP469 and a 100% interest in EPA-0127

Perth Basin: exciting onshore gas provinceWaitsia and West Erregulla discoveries establish new deep gas play

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warregoenergy.com© Warrego Energy Ltd 2019 warregoenergy.com

Basal Wagina sands sustained gas

Kingia sands sequence

High Cliff sands sequence

Beharra Springs analogue

Waitsia analogues or better

Major appraisal success at WE-2

1. Secondary target: the basal Wagina Sandstone• Significant conventional gas discovery

• Analagous to Beharra Springs

2. Primary Target 1: the Kingia Sandstone• Major conventional gas discovery

• Larger than Kingia at Waitsia with equal or better porosity and permeability

3. Primary Target 2: the High Cliff Sandstone• Major conventional gas discovery

• Comparable with HCSS at Waitsia

Source:

1. Strike Energy ASX announcement, West Erregulla– Additional Target and Final Pre-drill Prospective Estimates,

released on the 5th March 2019.13

WE-2 well targeted three highly prospective formations

Success in all three targets supports pre-drill resource estimates in excess of 1TCF1

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Kingia Sandstone – better than Waitsia-4?• Kingia intersected at 4,753m MDRT

• Substantially thicker than anticipated, extending to 4,870m MDRT

• 58m of net pay in a gross Kingia gas column of 97m, more than double Waitsia analogues

• Excellent reservoir quality with several large high-quality units of thick blocky porosity development and high gas saturation

• Porosities up to 19% (average 14.3%)• Permeability 102mD• Reservoir pressure in excess of 6800psia

‘Staggering’ Kingia discovery

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High Cliff Sands – another Waitsia-1?• HCSS intersected at 4,918m MDRT

• Net pay of 10m in a gross High Cliff gas column of at least 22m, in-line with Waitsia analogues

• Excellent conventional reservoir quality with high gas saturation and porosities up to 16%

Basal Wagina – another Beharra Springs?• Wagina Sandstone intersected at 4,106m MDRT;

substantial gas flow whilst drilling indicative of permeability

• Net pay of 10m in a gross Wagina gas column of 79m1

• Porosities of up to 14% and reservoir pressure in excess of 6,800 psia

Note: 1. Initial testing has been completed but further analysis may be required

Significant discoveries in HCSS and Wagina

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Gas to surface flare at WE-2

Success in the Kingia, Wagina and HCSS make it 3 from 3 material gas

discoveries in the ONE well

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West Erregulla compares favourably with Waitsia

Senecio-3 Waitsia-1 Waitsia-2 Waitsia-3 Waitsia-4 WE-1 WE-2Drilled Aug-14 Jun-15 Jul-15 Jun-17 Aug-17 Jul-90 Sep-19

TD (m) 3,370 3,507 3,530 3,612 3,744 4,065 5,100

Wagina gross/net (m) 88/0 148/0 - 32/0 107/0 45/0 79/10

Kingia gross/net (m) 39/10 36/15 66/7 52/20 42/21 Not reached 97/58

HC gross/net (m) 140/ 122/23 25/ 22/ 54/ Not reached 22/10

Kingia/HC test results Kingia/HC Kingia/HC Kingia Kingia Kingia Kingia/HC

• Casing diameter (“) 5 ½ 5 ½ 5 ½ 7 7 5 ½

• Prod’n tubing (“) 2 7/8 2 7/8 4 ½

• Flow rate (mmscfd) 12.3/0.3 25.7/24.7 38.5 49.5 89.6 Sep’19

• Choke size (/64”) 36 56/56 80 80 96

• FWHP (psig) 1,980 1,530/1,330 1,315 1,929 2,395

• Porosity (%) >11 18/ 14.5 >11 >11 14/10

• Permeability (mD) >10-100+ 137/12.5 >10 >10 >10 102/

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WA domestic gas market - current & potential supply

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• Multiple pathways for WGO gas to market

• Ability to market jointly or independently

• No significant acquisition cost hurdle

• Flexibility to supply large or small volume customers (i.e. incremental development)

• Export and backhaul potential

Supply gap may widen if potential new projects are delayed

Market tightening from 2021

1. AEMO press release, 13 Dec 2018, “AEMO releases 2018 Western Australia Gas Statement of Opportunities”

Source: Warrego Energy and market participants

WA domgas market tightening from 2021

“Our findings highlight a tightening of the domestic gas market in 2021 as supply contracts begin to expire and some existing domestic gas facilities face reserve depletion,” said AEMO’s Executive General Manager WA, Cameron Parrotte.

13 Dec 2018.1

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Is there another Waitsia & West Erregulla out there?…

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• Warrego holds EPA-0127 through 100% owned subsidiary Palatine Energy

• EPA-0127 extends to 2.2m acres (8,700 km2) across much of the Coolcalalaya sub-basin providing both potential Permian and older targets. Further possible analogues to Waitsia are feasible

• Traversed by the Dampier to Bunbury Gas Pipeline and immediately north of the Midwest Pipeline

• Native Title negotiations are close to conclusion

Additional potential in onshore Perth Basin

EP 469 WARREGO 50%

Strike 50%

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EPA-0127 - a Natural Extension

Gravity anomaly image of the Northern Perth Basin

M i n g e n e wD o n g a r a

Modified from Mory & Haig 2011

G e r a l d t o n

EP-469

Waitsia West ErregullaCliff Head

EPA-0127 • Essentially unexplored• A link between the Perth and

Carnarvon Basins• Recognised deep, ancient

basin• Identified structuring; known

reservoir quality; potential source rocks in deep kitchen

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EPA-0127 - Surface Geology and Gravity

EPA-0127

WA

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EPA-0127Newly acquired gravity stations (yellow +) and existing gravity stations (dots) are shown.

Asymmetric positive gravity anomalies highlighting basin structure. Sharp W-edges of highs formed by

NNW-trending faults with downthrow to the west.

GRAVITY SURVEY STATIONS

40 KM HIGH-PASS BOUGUER GRAVITY

From Mory et al 1998

From FrogTech 2013

From FrogTech 2013

A Deep, Asymmetric Structured Basin

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“Waitsia” rocks present in EPA-0127Extensive Permian (“Waitsia” sequence & equivalent) sediments extend over 900 km from the Merlinleigh Sub-basin to the Perth Basin

From Crostella 1995

Permiansediments

WA

ITSI

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QU

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RESERVOIR

RESERVOIR

RESERVOIR

SEAL

SEAL & SOURCE

SEAL

KINGIA SST

WA

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SEAL

“Waitsia” sequence extends across the western portion of EPA-0127

SEAL

SOURCE

RESERVOIR

SEAL

?SOURCE

RESERVOIR

RESERVOIRPE

RM

IAN

CARB

ONIFE

ROUS

KingiaSst

From Mory & Haig 2011

PER

MIA

NCA

RBON

IFERO

US

From Mory & Haig 2011

Northern Perth Basin

?RESERVOIR

Southern Carnarvon Basin

EPA-0127

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EPA-0127 Basin structure & potential traps

EPA-0127

40 KM HIGH-PASS BOUGUER GRAVITY

~200 km2

~240 km2

~175 km2

~90 km2

>400 km2

~50 km2

~60 km2

Multiple potential Waitsia and West Erregulla size opportunities

EPA-0127From FrogTech 2013

POTE

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“KIT

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Exciting potential in SpainTargeting quality prospects in high demand marketF

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• Warrego currently holds an 85% interest in Tarba Energia S.R.L. which owns the Tesorillo Project in Cadiz Province in southern Spain

• Prospex Oil and Gas plc holds the other 15% and has an option to acquire a further 34.9% at an exercise price of €1.725 million

• Targeting conventional sandstone gas reservoirs in a known 1956 discovery 3km from 40” gas pipeline

• Data integration underway for a possible 2020 spud date

Spain – The Tesorillo ProjectF

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Spain - 2019 seismic reprocessing

• Four 2D seismic lines reprocessed

• More coherent seismic events now visible

• Allowing seismic based mapping for the first time

• Data integration is key to further unlocking the potential of Tesorillo

• Additional prospects & leads identified

• Studying the potential for further data acquisition

Previous processing

2019 Reprocessing

Extensive work has taken in place on Spanish asset over the last 12 months…

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Spain – data integration key to success...

• Ongoing integration of geological fieldwork, newly reprocessed 2D seismic, MT and satellite imagery allowing seismic definition of prospective leads

2019 Reprocessing

0 km 5

Almarchal-1 1956

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Looking ahead

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• Sept 2019 – Wireline logging, side-wall coring, compositional analysis

• Sept 2019 – Completion of WE-2 for flow testing and production• Q4 2019 – Independent resource/reserves certification for West

Erregulla• Late 2019 – Drilling of Beharra Springs Deep-1 by BPT/Mitsui JV• Late 2019 – WGO to commence gas marketing

Imminent catalysts and news flow

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A Board and Management team with deep E&P experience and skin in the game

A portfolio of material projects at differing stages of development, each with the capacity to be “company transforming” in their own right in a success case

Announced major onshore discoveries at West Erregulla – potentially larger than the play opening Waitsia gas field – porosity as high as 19% and permeability of 102mD

Multiple pathways to commercialisation for West Erregulla fields

Significant upside potential from the Tesorillo Project in Spain & EPA-0127 in WA

Warrego has…

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Thank youwarregoenergy.comASX : WGO

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riu good oil conference - asx · 11-09-2019 · • this presentation does not constitute...

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