the next frontier - listed companyloyzenergy.listedcompany.com/newsroom/20121002... · loyzpens...
TRANSCRIPT
Company Update October 2012
www.loyzenergy.com
THE NEXT FRONTIER
2
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
2011
2010
2009
2008
Loyz Energy Limited – company snapshot
3 Notes: 1. Pending legal completion 2. 70% once interpretation of 3D seismic data is completed, and upon approval of Australian authorities 3. Pending shareholders’ approval Source: Loyz Energy Limited, Bloomberg (market data as of 1 October 2012)
Overview Key concessions Loyz Energy Limited (“Loyz” or the “Company”), previously known as Sim Siang
Choon Limited, aims to reposition into a Singapore-listed fast growing independent Exploration and Production (“E&P”) company, and is backed by an experienced and well-reputable management team
Loyz aims to build a balanced portfolio with a robust mix of both onshore and offshore E&P concessions
Loyz’s current portfolio includes concessions in potentially prolific and favorable fiscal E&P regimes including the US, New Zealand, Australia and India
To complement the Company’s technological and operational platform, Loyz has formed strategic alliances with GEO EAST Co. Ltd. for seismic capabilities and Rex Oil & Gas Ltd. (“Rex”) to jointly explore 35 acreages in Asia-Pacific using cutting edge, proprietary technologies
Loyz’s major shareholder is Jit Sun Investments Pte. Ltd. – ~31.8% stake
Time Event
May Jit Sun Investments acquires a 51% stake in Interlink Petroleum Limited, India
February Interlink Petroleum Limited begins seismic and drilling works
July Sim Siang Choon Ltd acquires Interlink Petroleum Limited
July Sim Siang Choon Ltd changes it’s name to Loyz Energy Limited
October Loyz pens cooperation agreement with Rex
November Enters into a farm in agreement for VIC/P62 in Australia
January Signs a strategic cooperation agreement with GEO EAST Co. Ltd.
August Announces the signing of the acquisition of its first New Zealand petroleum exploration permit within the Taranaki Basin
August Enters into a Participation and Exploration agreement in the US
October Loyz divests its sanitary ware division for SGD9m to concentrate on growing its upstream energy business3
2012
Site
Effective participation
interest1 Exploration Development Production
New Zealand - Awakino 10% New Zealand – Kahu, Mokau 90% US – Colorado, North Dakota 20% Australia - Pretty Hill 1 & 2 20%2 India - Baola and Gujarat 51%
Building the platform to emerge as a leading independent E&P company
Combining extensive industry experience with cutting edge / leading technology
Leveraging industry know-how and relationships to identify attractive entry opportunities
Focusing on acquiring under-evaluated and undervalued concessions in favorable fiscal regimes
Developing and maximizing the potential of concessions across the E&P process
Achieving first oil by 2013, by prioritizing the production of concessions with near term production potential
Market data (as of 1 October 2012) Current share price (S$) / market cap (S$) 0.49 / 144.4m
52 week high (S$) / 52 week low (S$) 0.52 / 0.26
Issued share capital / 3-month average daily turnover volume (shares) 294.6m / 286.8k
FY12 shareholders funds (S$) / Net cash (S$) 51.4m / (3.8m)
Strategy Key milestones
Value proposition
4
Proven fields
Production coming on stream
Development opportunities
Attractive prospects
Strong and experienced management
Extensive experience, know-how and relationships across the E&P industry
Seismic capabilities
Reservoir knowledge
Diversified concessions - New Zealand exploration and
development concession - Australian exploration concession
- India onshore exploration and development concession
- US onshore exploration, development and production concession
Service & development capabilities
5
Inked first major onshore E&P deal in the US where Loyz and Rex will carry out a drilling campaign of 80 onshore wells located in Colorado and North Dakota
Owns two production-sharing contracts (PSCs) for the onshore Baola and Modhera fields in Gujarat, India
Recently announced the acquisitions of two petroleum exploration permits (PEPs) – one for New Zealand’s Taranaki Basin1 and the other for an area off the coast of Victoria in Australia
Overview of concession portfolio (I)
Notes: 1. Pending legal completion Source: Loyz Energy Limited
Overview of concession portfolio (II)
6
Total gross acreage of ~5,299km2
Notes: 1. Pending legal completion 2. 70% once interpretation of 3D seismic data is completed, and upon approval of Australian authorities Source: Loyz Energy Limited, Competent Person’s report by Gaffney, Cline and Associates in June 2011, Trident Energy, Schlumberger (2009), Roxar
Gross Initially In Place (GIIP)
Field Area Effective participation interest1 Structure Oil (mmbbl) Gas (bcf)
P90 Mean P10 P90 Mean P10 New Zealand
Awakino
Taranaki Basin, New Plymouth (411km2)
10% Mangahewa - - - 40 53 70
Kahu 90% Fan Sand - - - 54 156 294
Kahu 90% Mangahewa - - - 108 368 723
Kahu 90% Tikorangi - - - 35 255 568
Mokau 90% Mangahewa - - - 280 1,123 2,257
Sub-total - - - 517 1,955 3,912
Australia
Pretty Hill 1 Victoria, Torquay Basin
(4,630km2)
20%2 n/a 512 1,796 3,556 505 1,741 3,432
Pretty Hill 2 20%2 n/a 301 1,149 2,322 297 1,114 2,243
Sub-total 813 2,945 5,878 802 2,855 5,675
India
Baola Gujarat (4km2) 51% Kalol 5 7 10 1 1 2
Modhera Gujarat (13km2) 51% Modhera 8 18 52 - - -
Sub-total 13 25 62 1 1 2
US
Whitewater Colorado (202km2) 20% Dakota Sst 133 176 224 - - -
North Dakota North Dakota (39km2) 20% Renville County - - - - - -
Sub-total 133 176 224 - - -
Gross acreage ~5,299km2
Estimated near term capex of ~USD30m to drill one exploration /
appraisal well before end 2013
Estimated seismic and drilling capex of ~USD35m before 2014
Estimated near term capex of ~USD24m, drilling to commence
1Q2013
First production expected in 2012/13
Key highlights
7
Notes: 1. Pending shareholders’ approval
(1) Loyz Energy positioned for
growth
(2) Technology a key differentiator
Loyz is well-positioned to become a leading independent E&P player based in Singapore - Possesses a portfolio of quality exploration, development and production concessions in commercially favourable fiscal
regimes including Australia, India, New Zealand and the United States - Recently announced US farm-in gives Loyz access to huge acreages in North Dakota and Colorado’s largest unitized Oil &
Gas (“O&G”) lease, on top of enjoying immediate cash flows through a turnkey drilling contract to the operator for the whole project
- Divestment of sanitary ware division to concentrate on growing its upstream energy business1
Access to Rex’s proprietary technologies for the Asia-Pacific region - Exploration methodology based on proprietary data handling and analysis systems like Rex Gravity©, Rex Seepage©,
and Rex Virtual Drilling© to more accurately identify commercial prospects and reduce risks involved with drilling
- Technologies would also be managed by a superior management team with worldwide expertise and knowledge
Key highlights (II)
8
(3) Quality concessions & active risk management
(4) Strong potential from the concession portfolio in the near
term
Favourable risk-reward returns owing to its balanced portfolio of growth concessions and active management team - Robust mix of exploration concession in Australia, exploration and development concession in New Zealand and India, and
exploration and production concessions in the United States - Potential is supported by prolific discoveries in adjacent or nearby fields, as well as encouraging seismic results - Has options to farm-out its current leases to provide revenue opportunities, and avoid over-extension of balance sheet - Management team has more than 50 years of direct experience in professional exploration and production activities
United States concessions providing almost immediate cash flow; India concessions on the periphery of first production
- United States concessions provide immediate access to total reserves of 6.19 barrels of 2P oil reserves, 6.84 million barrels
of 2C oil resources and 2C gas resources of 45.18 billion cubic feet Prolific potential from New Zealand and Australia concessions - High potential in prospecting the New Zealand resources, based on data sources and interpretation provided by external
consultants like GCA and Schlumberger, profiles of nearby fields from sources like Geoscience Australia, and other publicly available information
- Encouraging initial seismic results from the Australia concession, with attractive leads identified for further seismic shoots and analysis, followed by potential exploration / appraisal drilling targets
9
2012 2013 2014 and beyond
Loyz acquired its first New Zealand petroleum exploration permit for USD6.5m An initial USD1.5m refundable payment made to STP Energy Pte. Ltd. at the binding memorandum of understanding stage will be used to offset the USD6.5m payable
Loyz Energy will contribute ~USD14m for the cost of exploration and drilling for the first 40 wells in Colorado and North Dakota Loyz Energy plans to drill one exploration / appraisal well in New Zealand in 2013 with estimated capital expenditure of ~USD30m
Post drilling of the first 40 wells in the US, parties will undertake the drilling of an additional 40 wells, whereby Loyz will contribute ~USD6m of the drilling cost Prospecting Australia concession with further seismic data acquisition
Future roadmap
Source: Loyz Energy Limited
10
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
An independent E&P company
11
Asset owner Explore Develop Produce Transport Refine Distribute Consume
Integrated oil company
Independent E&P company
Oil service companies – support activity
Focus/Rebrand Be recognized as a technology based regional O&G Independent
Development Production/ Discovered Concessions
2009
2008
Transformation to an independent E&P company
12 * On 17 September 2012, the Company received a letter from a law office acting for Discovery Geo Corporation (“Discovery Geo”), alleging among other matters, that Discovery Geo owns a 25% beneficial interest in the permit and that the sale by STP to Loyz NZ Ventures Limited (“Loyz NZ”) is ineffective. In consultation with its legal advisors, Loyz NZ responded to inform Discovery Geo that as Loyz NZ has no relationship, legal or otherwise, with Discovery Geo, Discovery Geo should correspond with STP directly as regards any claims concerning the permit. Source: Loyz Energy Limited, Interlink Petroleum Limited
2008
2010
2012
2011
Time Event
May Jit Sun Investments purchases a 56% stake in Interlink Petroleum Ltd for Rs172.8m through a preferential allotment. The equity capital was planned for the expansion of business, capital expenditure and business development expenditure, as well as augmentation of working capital.
February Interlink Petroleum obtains the mining lease for Modhera oil field, the Production Sharing Contract and the field. The planned development of the Modhera field was conducted systematically by first acquiring seismic data and subsequently drilling new wells.
July
Sim Siang Choon's (SSC) proposes an acquisition of a 47.9% stake in Interlink Petroleum Ltd (BSE Investments (41.4%) and Kenneth Pereira (6.5%). This was paid via the issuance of 108.49m new ordinary SSC shares at SGD0.11 per share. Proposed issuance of 22.25m new shares at SGD0.11 per share to Kenneth Pereira.
September Mandatory general cash offer by Jit Sun Investments for remaining shares of Sim Siang Choon at SGD0.11 per share.
July Issuance of 12m convertible preference shares at SGD1.00 per share to Venstar Investments Ltd and Venstar Investments II Ltd. Proposed change of company name from 'Sim Siang Choon Ltd’ to ‘Loyz Energy Limited’.
October Signs cooperation agreement with Rex Oil & Gas Ltd (private) to jointly carry out exploration activities in 35 areas across Asia Pacific.
October Signs a MOU to purchase interest in a PEP in Taranaki Basin, offshore Taranaki Basin, New Zealand from STP Energy Pte. Ltd. (“STP Energy”). Pays a refundable USD1.5m deposit for the stake.
November Enters into a farm-in agreement with Trident Energy Limited. Acquires a 20% stake in Petroleum Exploration Permit VIC/P62 over Area V04-2 in the Victorian Adjacent Area, Australia for AUD650,000. Has an option to earn up to another 50% stake by acquiring, processing and interpreting 3D seismic shoot.
January Signs a strategic cooperation agreement with GEO EAST Co., Ltd., seismic services subsidiary of BGP International and CNPC.
August Enters into a placement agreement with an investor for the subscription of 12m new shares, raising SGD3.7m in proceeds that will fund working capital requirements and other projects.
August Announces the signing of the acquisition of its first New Zealand petroleum exploration permit for USD6.5m, giving Loyz the right to explore for hydrocarbons in the Awakino area which is located within the prolific oil-producing Taranaki Basin.
August Enters into a Participation and Exploration agreement with Rex Oil & Gas Ltd. and Fram Exploration ASA to participate in drilling of 80 onshore wells in Colorado and North Dakota. Loyz and Rex Oil & Gas Ltd. will also provide 2 drilling rigs.
October Loyz announces that is proceeding with a farm-in-agreement with STP Energy in relation to the acquisition of certain interest in an exploration permit in New Zealand, on the basis that STP Energy is the 100% legal and beneficial owner of the permit and that completion of the acquisition should continue*.
October Announces agreement to sell sanitary ware division for SGD9.0m, subject to shareholders’ approval. This sale will allow Loyz Energy to concentrate on growing its upstream energy business and augment the Group’s working capital for ongoing projects and future O&G opportunities.
Attractive concessions in favorable fiscal regimes
13 Source: Loyz Energy Limited
Modhera, Gujarat (13km2)
Baola, Gujarat (4km2)
Torquay Basin, Australia
(4,630km2) Pending 3D seismic data
confirmation
Taranaki Basin, New Zealand (411km2)
Contingent resources of 25.9bcf gas and 1.7m stb of condensate
Williston Basin, North Dakota
(39km2)
Whitewater, Colorado (202km2)
Combined production potential of ~292,000 cubic feet per day of natural gas
2P Reserves 6.19mmbbl of oil reserves; 2C gas resources of 45.18bcf
Organizational structure (targeted)
14 Separate entity Source: Loyz Energy Limited, Bloomberg (market data as of 1 October 2012)
Dr Kenneth Pereira MD of Hibiscus Petroleum
Jit Sun Investments Family office of the Lee family
Mr. Sim & Associates Previously the major shareholder
of SSC Public
31.8% 31.6% 33.9%
* Divestment pending shareholders’ approval
2.7%
Loyz Oil Australia Pty Ltd Loyz Oil New Zealand Limited Loyz NZ Ventures Limited
Interlink Petroleum Limited Loyz Oil Pte Ltd
100%
100% 100% 51%
10.4%
41.37%
Loyz USA Holdings LLC
Loyz America LLC Loyz Rex Drilling Services LLC
100%
100% 51%
Management team
15
Dr. Ambrose Corray, Chief Executive Officer More than 25 years oil field experience through senior management levels with Schlumberger, General Electric, and Interlink
Petroleum Ltd, providing all aspects of oilfield services to major clients worldwide Bachelor of Science (Honours) degree in Mechanical Engineering from King's College, London University (United Kingdom) and a
Masters degree in Business Administration and a Doctorate in Business, both from Southern Cross University (Australia)
Mr. Adrian Lee, Executive Director Represents Jit Sun Investments Pte. Ltd and also holds directorship at various companies Over 10 years of business experience in the O&G sector, both within and outside India Graduated from University of Strathclyde, Glasgow, majoring in Finance
Dr. Bruce Morris, Chief Technical Officer More than 20 years of professional exploration experience across the globe, including New Zealand, Australia, Papua New Guinea,
China, Thailand, India, Cuba and the Antarctica Extensive expertise in prospect generation and evaluation, as well as seismic, drilling and production operations, both on the field and
at the supervisory level, serving at BDM Consulting, NZ Oil & Gas, Indo-Pacific Energy (now Austral Pacific Energy), Pacific Tiger Energy, Oil Exploration Consultant, Glenaladale Forestry Ltd and is currently Director of Global Seismic Solutions Ltd
PhD in Geology and Geochemistry from Victoria University of Wellington
Mr. Jeffrey Pang Kee Chai, Chief Financial Officer Oversees finance, accounting, tax, compliance and reporting matters Over 10 years of experience in the role of finance with various multi-national corporations External Auditor of Deloitte and Touche from 2000 to 2004, and is a fellow of the Association of Chartered Certified Accountants and a
Certified Public Accountant of Singapore
16
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
PEP 38479 – New Zealand concession
17
The permit located off New Plymouth, New Zealand is 411km2 (~101,560 acres) in total
4 wells drilled in the 1980s; Seismic done to cover most of the permit area
One well will be drilled for appraisal before the end of 2013; USD30m of investment is expected
Awakino South-1 was spudded in 39m of water on 30 August 2008 and reached a total depth of 3459m on 01 November 2008 (64 days)
Loyz will be the the permit holder and co-operator with STP Energy Pte. Ltd., a private company based in Singapore
Area 1
Area 2
Permit
Nearby fields
showing promising
results
Source: Schlumberger Integrated Reservoir Study (2009)
PEP 38479 – farm-in agreement in progress
18
On 6th August 2012, Loyz NZ Ventures Limited (“Loyz NZ”), a subsidiary of Loyz Energy Limited, agreed to acquire a 90% working interest and 100% legal
ownership interest in Area 2 and 10% working interest in Area 1 of the petroleum exploration permit PEP 38479 in Taranaki Basin, New Zealand, from STP
Energy Pte. Ltd. (“STP”), an O&G company, for a purchase consideration of USD6.5m
PEP 38479 covers an area of 411 km2 in the Awakino area which is located within the Taranaki Basin, New Zealand
- Contingent resources of about 25.9bcf of gas and 1.7m stock tank barrels (STB) of condensate. This permit was recently extended for a further period
of 4 years from 24 September 2012 to 23 September 2016
Under the terms of the agreement, Loyz NZ will make an initial payment of USD2.5m of the acquisition cost within five business days after STP provides
documentary evidence of the receipt of consent of the Minister under section 41 of the Crown Minerals Act 1991 (NZ), and the remaining USD4m will be payable
within 14 business days after completion of the transfer of the interest in the permit to Loyz. In addition, Loyz NZ and STP will enter into a joint operating
agreement (“JOA”) for the permit
The transaction is subject to conditions such as the consent of the Minister under section 41 of the Crown Minerals Act 1991 (NZ), entry into JOA by
Loyz NZ and STP, and approval from other relevant authorities
Source: Loyz Energy Limited
PEP 38479 - Schlumberger Integrated Reservoir Study (2009)
19
Seismic database
Source: Schlumberger Integrated Reservoir Study (2009)
Year Program #km Comments
1978-1991 Misc. pre-existing 2D ~2,000km Mixed quality. Some very short offsets (<2,600m) within some datasets
2000 PT00 2D ~600km Good quality and coverage principally over Awakino South prospect
2003 Reprocessing of various older vintages of 2D 430km To improve imaging within the Turi Fault Zone and to optimize
future acquisition programs
2004 DG04 2D 630km To better define Turi Fault Zone, and optimize planning of Kahu 3D acquisition
2005 Kahu 3D 529km2 Key objectives: reduce structural risk on Awakino South Prospect and better define Eocene fan
2005 Horst 3D 118km2 To define geometry of observed horst block in north of PEP 38479, and facilitate seismic basement discrimination
2006 Mokau 2D 152km Investigation of closure up dip of Mokau-1
2006-2007 PSDM (Oil Hunters) 123km2 Pre-Stack Depth Migration performed on a subset of Kahu 3D, to reduce drilling risk at Awakino South
Third-party studies show encouraging initial findings Geological model base case
Turi 20.5mmstb oil in place
Mangahewa 107bscf gas in place
Mangahewa 11.8mmstb condensate in place
PEP 38479 – resources (hydrocarbons-in-place)
20
Volumes by zone
Formation Hydrocarbon P90 P50 P10 Base Case
Turi Oil (mmstb) 16.8 26.8 39.4 20.5
Mangahewa (total) Gas (bscf) 78 116 162 107
Mangahewa-1 unit (upper) Gas (bscf) 74
Mangahewa-1 (lower) Gas (bscf) 24
Mangahewa-2 unit Gas (bscf) 9
Mangahewa (total) Condensate (mmstb) 8.6 12.7 17.8 11.8
Source: Schlumberger Integrated Reservoir Study (2009)
Field totals
Formation Hydrocarbon In-place volume
Mangahewa – Awakino Sector Gas (bscf) 107 Base case
Mangahewa – Awakino Sector Condensate (mmstb) 11.8 Base case
Mangahewa - Mokau Sector Gas (bscf) 2,500 Notional mean GIIP
Mangahewa - Mokau Sector Oil (mmblo) 125.0 Notional mean
Mangahewa – Kahu Sector Gas (bscf) 264
Mangahewa – Kahu Sector Oil (mmblo) 571
Fan Sand – Kahu Sector Gas (bscf) 86
Fan Sand – Kahu Sector Oil (mmblo) 251
21
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
Overview of Colorado and North Dakota development concessions
22
Agreement to farm into huge acreages (~60,000 acres) in North Dakota and Colorado’s largest O&G lease
Proven basin with oil producing wells in both States
Infrastructure substantially developed - access to two taps connected to the Trans-Colorado pipeline within the Colorado concession (estimated value of USD2m per tap)
Loyz, together with a strategic partner Rex, will drill for share of Net Revenue Interest which is convertible into Working Interest
Loyz and its partner will bring in 2 rigs to drill 40 onshore wells over 24 months and 80 wells in total
- Loyz will receive 20% Net Revenue Interest for each drilled and completed well
- The rigs will be fully funded and financed with 70% debt and 30% equity
The vendor of the blocks will contribute 30% of the drilling capital expenditure over the 24 months; Loyz and Rex will contribute the remaining
In addition to the 40% NRI, Loyz and its partner will also earn a percentage of the working interests (title) to all the leases in Colorado and North Dakota
There will be bonus given to Loyz and Rex once production exceeds a pre-agreed level
Significant potential upside in the leases coming from shale plays in North Dakota and also gas reserves already discovered in Colorado
Source: Loyz Energy Limited, Fram Exploration ASA Notes: 1. Term leases include some Held by Production (HBP) leases 2. Whitewater production unit lease working interests (WI) and net revenue interests (after royalties) (NRI) shown is the estimated average for all Fram’s oil and gas leases respectively. The actual average NRI is 77.19% of Fram’s WI and the effective NRI shown is Fram’s WI multiplied by 0.7719
Whitewater Field, Colorado
Williston Basin, North Dakota
Colorado and North Dakota – potential game changers
23 Source: US Energy Information Administration based on data from various published studies. Canada and Mexico plays from Advanced Resources International, Inc.. Updated May 9 2011
Shale crude potential in North Ameria
North Dakota
Colorado
Colorado and North Dakota – potential game changers (II)
24 Source: PIRA Energy Group, International Energy Agency, World Energy Outlook, DNB Markets, US Energy Information Administration (EIA)
Significant shale crude potential in North Dakota
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2002 2004 2006 2008 2010 2012 2014 2016 2018 2020
Mill
ion
b/d
US Shale Crude Production From Bakken, Eagle Ford, Niobrara
PIRA - Sep 2012 IEA - World Energy Outlook November 2011Source: PIRA - May 2012, IEA WEO November 2011Source: PIRA - Sep 2012, IEA WEO November 2011
North Dakota shale crude production forecasts
0
100
200
300
400
500
600
700
800
900
1000
2000 2002 2004 2006 2008 2010 2012 2014
kbd
Bakken Liquids Production - US North Dakota
PIRA Estimate Dec-2009 PIRA Estimate Oct-2011 PIRA estimate May-2012Source: PIRA
Texas oil production has been declining for the past 40 years to about 1.1 million b/d in 2010 but has since increased to above 1.8 million b/d
North Dakota has also increased production by about 0.5 million b/d since 2008
The increase in oil production can primarily be attributed to shale oil production – total US crude oil production as of May 2010 was 5.5 million b/d but has since increased to 6.3 million b/d as of May 2012
Shale crude production in North Dakota has significantly exceeded analyst estimates in half a year between November 2011 and September 2012
Bakken shale crude forecasts have approximately doubled for 2014
Loyz’s current focus remains on conventional oil extraction, but the potential for shale crude production is evident
Overview of US concessions
25
Notes: 1. Gross Reserves are the estimated volumes attributable to 100% of the field 2. Gross Contingent Resources are the estimated volumes attributable to 100% of the field, and are 100% of the volumes estimated to be recoverable from the field without any economic cut-off being applied 3. Loyz is guaranteed 20% of NRI Source: Competent Person’s report by Gaffney, Cline and Associates in June 2011
Summary of net field oil reserves (mmbbl) as at 30th April 2011
Field Proved Proved plus Probable Proved plus Probable plus Possible
Whitewater production unit - Dakota Oil Reservoir 0.06 6.02 7.97
East Smith discovery, Williston Basin 0.09 0.17 0.24
Total 0.15 6.19 8.21
Field
Net contingent resources (mmbbl)
1C 2C 3C
Whitewater production unit - Dakota Oil Reservoir 0 4.24 4.24
East Smith discovery, Williston Basin 1.61 2.6 4.15
Total 1.61 6.84 8.39
Summary of net entitlement contingent oil resources (mmbbl) as at 30th April 2011
Summary of net field gas resources (bcf) as at 30th April 2011
Field
Net contingent resources (bcf)
1C 2C 3C
Whitewater production unit - Dakota Gas 9.6 13.3 18.0
Whitewater production unit - Brushy Basin Gas 21.7 30.7 41.6
East Smith discovery, Williston Basin 0.7 1.2 2.1
Total 32.0 45.2 61.6
26
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
Australia concession – VIC/P62
27
Key liquid hydrocarbon basins in Australia
Source: Geoscience Australia
Australia concession – VIC/P62 (II)
28
Torquay Basin, Australia
Otway Basin
Lachlan Fold Belt
Rocky Cape Block
Bass Basin
TorquaySub-basin
VIC/P62
-100
-80
-80
-60
-60
-200
White Ibis
Trefoil
YollaRockhopper
Thylacine
Geographe
MinervaCasino
La Bella
Vic/P62
Location Off Torquay sub-basin of South Eastern Australia, close to the metropolitan area of Melbourne – Australia’s second largest city
Area 4,630 km2
Water Depth Less than 50m – 80m
Drilling Targets
Less than 1500m – 3000m
Potential Reserves
Un-risked discovery in excess of 600mmblo
Nearby development - Bass Basin (Origin Energy Resources)
Operator Origin Energy Resources operates the Rockhopper (39% participating interest) and Yolla (42.5% participating interest) asset
Potential Reserves
Yolla: proven and probable reserves equivalent to 151Pje, with condensates alone amounting to 4,185 kbbls
Rockhopper: Chappel 3D seismic survey interpretation has been completed and work is continuing on the volumetric modelling of the Trefoil gas/condensate resource
Nearby development – Otway Basin (Origin Energy Resources)
Operator Origin Energy Resources operates the Geographe and Thylacine (80% -100% working interests) assets within the Otway Basin
Potential Reserves
2P reserves of 339PJ of gas, 623kT of LPG, and 4,963kbbls of condensates
35.6 Pje of sales volume in 2011 and 24.6 Pje of sales volume in 2010 from the Otway Gas Project
Source: Origin Energy Resources website (http://www.originenergy.com.au/)
Australia concession – VIC/P62 (III)
29
Torquay Basin volumetrics from key concessions
Notes: 1. Risk of misinterpretation of faults and horizons due to seismic imaging at depth, need to reduce risk by 3D seismic Source: Loyz Energy Limited
Risks (Pretty Hill Farm 1 & 2)
Reservoir 40% Closest offset wells have reservoir, but vertical distribution locally is unknown, risk is mis-identification of seismic events
Source & maturation 60% Access to multiple potential horizons above and within section by
thickness/quality unknown
Trap & seal 80% Eumerallia drape over structure is positive, fault history is risk old structures in place through important burial events, pathways unclear at this stage
Timing & migration 75%
Overall chance of success 14% Source modeling high grades oil chance. Total risked oil resource: 92 MMbbl
Prospect Area (km2) STOOIP/GIP Rec.MMbbl/BCF Pretty Hill Fm 1 oil case 119 1,177 412 gas case 119 2,004 1,002 Pretty Hill Fm 2 oil case 75 695 243 gas case 75 1,184 592
Parameters N:G 10m net Porosity 24% Saturation 65% Shrinkage 89% Recovery 60% Units cu m>bbl 6.3 Units cu m> Cu ft 35.3
Parameters Oil case Gas case N:G 15% 15% Porosity 14% 14% Saturation 60% 70% Shrinkage 1.3 200 Units cu m>bbl 6.29 Units cu m> Cu ft 35.3 Recovery 50% 50%
Boonah/EVCM Area (km2) STOOIP Rec. COS VF P14 closure 2 14.9 130.1 65.1 9% VF P14 closure 3 24.6 210.5 105.2 17% VF P14 closure 6 15.5 135.3 67.6 9%
Risked
resource Top 3 total 475.8 237.9 24.5MMbbl
Primary target is Early Cretaceous Pretty Hill Formation due to size and age of structure identified, and (potential) volumes of mature source rock accessible
Good closure size
30
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
Interlink Petroleum’s key concessions (1) - Baola
31
Proven partially developed deposit
Production Sharing Contract (“PSC”) signed in April 1995
Mining lease granted in March 2004
Gas supply from Boala 1 at 1,200m3/d between June 2011 to June 2004
- Supply was disrupted due to water ingress
3D seismic survey done of entire block in 2009
Well Boala 8 drilled in August 2010 and resulted in discovery
Ahmedabad
Baroda
Boala Boala
Year of discovery 1971
Discovery well Boala 1
Area 4km2
Depth of top reservoir 880mts
Wells Boala 1, 5 & 8
Baola 1 tested gas 36,225m3/d (6mm bean)
Baola 5 tested gas 32,130m3/d (6mm bean)
Duration of PSC 25 years (2020)
Source: Loyz Energy Limited
Interlink Petroleum’s key concessions (1) – Baola (II)
32
Baola 8 spudded 27 August 2010
Drilled to a depth of 1,009 meters
Several hydrocarbon bearing sections were identified through, mud log and electric-line log evaluation
Preliminary testing of the interval 909-911 meters yielded heavy oil that flowed to surface under natural flow
Initial estimates indicate the gross pay to be 23.5 meters with a net pay of 9 meters
Internal Seismic model oil pool to be in the range of 4-9 million bbls of oil in place
Preliminary analysis indicate that the specific gravity of the oil is approximately 12⁰ API
Reservoir engineering on-going
Oil Gas
909 – 911m – OS I 906 – 909m
913 – 918m – OS II
923 – 928m – OS III
Source: Loyz Energy Limited
Interlink Petroleum’s key concessions (2) - Modhera, Gujarat
33
Highly viscous oil shows at 964 – 972mts while testing
PSC signed in February 2001
Mining lease granted in November 2008
Oil supply agreement with Indian Oil
Drilling completed with oil shows
Modhera, Gujarat
Year of discovery 1982
Discovery well Modhera 1
Area 12.7km2
Depth of top reservoir 898mts
Wells Modhera 1
Effective date of mining lease 6 November 2008
Duration of PSC 25 years (2033)
2D Seismic 1976 – 1986
Ahmedabad
Modhera
Source: Loyz Energy Limited
34
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
Rex Oil & Gas Ltd.
35 Source: Loyz Energy Limited , Rex Oil & Gas Ltd.
The founders of Rex Oil & Gas Ltd., Hans Lidgren M.sc., CV Karllidgren, PhD, and Svein Kjellesvik, pioneered the use of satellite altimeter surveys to detect potential hydrocarbon reservoirs in the beginning of the 1980’s. The Rex team has experience from all phases of the exploration process, different geological contexts and legislative environments
The founders set out to create an exploration methodology based on proprietary data handling and analysis systems. These technologies would also be supported by a superior management team with worldwide expertise and knowledge
Loyz has signed a cooperation agreement with Rex for proprietary use of its technology for the Asia-Pacific Region
Together with Rex, Loyz will identify 35 prospects in the region
Both companies, through the use of experienced know how and new niche technologies will further study, shortlist and develop 15 opportunities of which the technology must show a minimum of 50m barrels in place
Loyz has access to Rex’s technology for the Asia-Pacific region
Rex Gravity© Ultra sensitive gravity field computation based on satellite altimetry and bathymetry Law of Gravity & physics widely used
Seeps & Slicks©
Analysis based on satellite infra-red measurements Natural seepage leakage on average 4.3m barrels/year 60 times greater than the leakage from exploration and production
− 63% natural seepage − 32% consumers − 4% oil tankers − 1% oil platforms
Virtual Drilling© Identification of low resonance effects on conventional seismic data Advanced seismic resonance evaluation
Background
36
I. Introduction and key highlights 2
II. Company overview 10
III. New Zealand 16
IV. America 21
V. Australia 26
VI. India 30
VII. Rex Oil & Gas Ltd. 34
VIII. Appendix 36
Turnkey drilling arrangement in the US
37
100%
Loyz USA Holdings LLC (Holding Company)
Loyz USA (Oil Interest)
Loyz Rex Drilling Services LLC
Turn-key drilling services income
US Operating Company
(North Dakota and Colorado) Drilling & well
completion services
US leases
Loyz Australia
100%
Source: Loyz Energy Limited
51%
Oil & gas reserves - definitions
38
90% 50% 10%
Project Maturity Sub-Classes
On Production
Approved for Development
Justified for Development
Development Pending
Development Unclarified/On Hold
Development not Viable
Prospect
Lead
Play
< In
crea
sing
Cha
nce
of C
omm
erci
ality
>
ProbabilityC
omm
eric
alS
ub-
Com
mer
cialD
isco
vere
d P
IP
Und
isco
vere
d P
IP
Tota
l Pet
role
um in
itial
ly-in
-pla
ce (P
IP)
ProductionReserves
Contingent resources
UnrecoverableProspective resources
Unrecoverable
Proven Probable Possible
1P 2P 3P
1C 2C 3C
Low Estimate
Best Estimate
High Estimate
Contingent Resources: Potentially recoverable from known accumulations, but cannot be commercially developed due to one or more contingencies Definition of reserves: Reserves are those quantities of petroleum claimed to be commercially recoverable by application of development projects to known accumulations under defined conditions. Reserves must satisfy four criteria. They must be (1) discovered through one or more exploratory wells, (2) recoverable using existing technology, (3) commercially viable and (4) remaining in the ground Categorization of reserves: − Proven: 90% probability of recovery under
existing economic and political conditions, with existing technology
− Probable: 50% probability of recovery − Possible: 10% probability of recovery − 1P = Proven − 2P = Proven & Probable − 3P = Proven, Probable & Possible
Source: Competent Person’s report by Gaffney, Cline and Associates in June 2011
Important notice
39
This document is for informational purposes only and does not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire securities of the Company and is not to form the basis of or be relied on in connection with any contract or any other purpose. This document is not a prospectus under the Securities and Futures Act (Chapter 289 of Singapore) (the “SFA”) and will not be registered as a prospectus by the Monetary Authority of Singapore (the “MAS”).
The information in this document does not contain all relevant information relating to the Company or its securities, particularly with respect to the risks and special considerations involved with an investment in the securities of the Company. Any decision to invest in the securities of the Company should be made only after conducting such investigations as you deem necessary or appropriate and consulting your own legal, accounting, tax and other advisors in order to make an independent determination of the suitability, merits and consequences of investment in the Company described herein.
This presentation contains statements that constitute forward-looking statements. These statements include descriptions regarding the intent, belief or current expectations of the Company or its officers with respect to the consolidated results of operations and financial condition, and future events and plans, business, strategy and market opportunities of the Company. These statements can be recognised by the use of words such as “forecast”, “expects”, “plans”, “will”, “estimates”, “projects”, “projections”, “intends”, or words of similar meaning. However, you should note that these words are not the exclusive means of identifying such forward-looking statements.
These forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may be materially different from those in the forward-looking statements as a result of various factors and assumptions. Such statements are based on the assumptions of the Company as stated in this presentation, and are only assumptions made as at the date of this presentation. You are cautioned not to rely on these forward-looking statements, which are based on the current view of the management of the Company on future events, without conducting your own and independent research. No assurance can be given that assumptions are correct or that future events will occur.
The Company does not undertake to and disclaims all responsibility to, update or revise the statements herein after the date of this presentation to reflect subsequent or future events or circumstances, including any change in the Company’s expectations.
Any sources that the Company has cited (apart from itself), namely Gaffney, Cline, and Associates, Fram Exploration ASA, Schlumberger, Trident Energy, Roxar, Bloomberg, the US Energy Information Administration, PIRA Energy, the International Energy Agency, Sparebank 1 Markets, Geoscience Australia, and Origin Energy Resources, has not consented to the inclusion of the information provide from such sources. While the Company has taken reasonable care and due diligence to ensure that statements from the sources, namely namely Gaffney, Cline, and Associates, Fram Exploration ASA, Schlumberger, Trident Energy, Roxar, Bloomberg, the US Energy Information Administration, PIRA Energy, the International Energy Agency, Sparebank 1 Markets, Geoscience Australia, and Origin Energy Resources, have been reproduced in their proper form and context, and that such statements have been extracted accurately and fairly from the report, none of the Company, or their respective officers, agents, employees and advisers have conducted an independent review of the content or independently verified the accuracy thereof.
Contact information
40
Company address: Contact 15 Hoe Chiang Road
#19-01 Tower Fifteen
Singapore 089316
Tel : +65 6521 9048
Fax : +65 6225 4945
Investors and media:
Oaktree Advisers
Ms. Nora Cheng - +65 9634 7450
Ms. Carol Chong - +65 9475 3167
Website: www.loyzenergy.com