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www.sterlingenergyplc.com
Disclaimer
This presentation has been prepared by, and is the sole responsibility of, the directors of Sterling Energy plc (the ‘Company’).
This presentation and the information contained in it does not constitute a prospectus or listing particulars relating to the Company and has not been approved by the UK Listing
Authority, nor does it constitute or form any part of any offer or invitation to purchase, sell or subscribe for, or any solicitation of any such offer to purchase, sell or subscribe for, any
securities in the Company, nor shall this presentation or any part of it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract therefore.
No reliance may be placed, for any purposes whatsoever, on the information contained in this presentation, or upon its completeness or accuracy and this presentation should not
be considered a recommendation by or on behalf of the Company or any of its directors, members, officers, employees, agents, advisers or any other person in relation to any
purchase of, or subscription for, ordinary shares.
No representation or warranty, express or implied, is given by or on behalf of the Company or any of its directors, members, officers, employees, agents, advisers or any other
persons as to the accuracy, fairness, completeness or sufficiency of the information or opinions contained in this presentation and none of the information contained in this
presentation has been independently verified or approved. All financial information contained within this presentation has not been approved by the Company’s auditors and, as
such, may be liable to change. Save in the case of fraud, no liability is accepted for any errors, omissions or inaccuracies in such information or opinions.
This presentation and its contents and any accompanying information communicated verbally as part of the presentation, including the speeches of the presenters, any question
and answers session and any materials distributed in connection with it, is being made only to and is directed only at (i) persons in the United Kingdom having professional
experience in matters relating to investments, being investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005, as amended (the ‘FPO’), (ii) high net worth companies, unincorporated associations and other bodies in the United Kingdom within the meaning of Article
49(2) of the FPO, (iii) in the United States to persons the Company reasonably believes to be qualified institutional buyers, as defined in Rule 144A(a)(1) of the United States
Securities Act of 1933, as amended (the ‘Qualified Institutional Buyers’) and (iv) persons to whom the presentation may otherwise lawfully be made (together ‘Relevant Persons’).
This presentation must not be acted on or relied upon by any persons who are not Relevant Persons. Any investment or investment activity to which this presentation relates is
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Neither this presentation nor any copy of it may be distributed, forwarded to, or transmitted in or into the United States of America (except to persons the Company reasonably
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Certain statements in this presentation are or may constitute ‘forward looking statements’. Such forward looking statements involve risks, uncertainties and other factors which may
cause the actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed by such
forward-looking statements. The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice.
3
www.sterlingenergyplc.com
Disciplined M&A driven growth
Robust platform, Capital discipline, Transformational M&A focus
Somaliland
Odewayne
Sterling 34%
Genel 50% Op.
Petrosoma 16%
M&A focus Debt free & fully
funded Ca. $47.3m cash*
Major
shareholders
(45%) on Board
Proven
international
operator
Material M&A
2P/2C mandate
Odewayne
1,000kms 2D
completed
*Unaudited as at 31 Mar-18
4
www.sterlingenergyplc.com
Corporate snapshot
LSE-SEY Ticker
(AIM listing 2002)
GBP
£0.1291
Share price
220.1 Shares outstanding
(million)
220.1 Fully diluted share positions
(million)
$38.6m1 Market capitalisation
(US$ million)
$0 Debt (US$)
$47.3m Cash at 31 Mar-18
(US$ million-unaudited)
Q1 2018 Financial summary
Turnover $525k
Adj. EBITDAX
(US$ million) $(476k)
Advisors
1 as at 11 May-18
Share ownership*
Waterford
Finance &
Investment
(29.45%)
Zion SPC
(16.64%) Mistyvale
(15.66%)
Denis O’Brien
(7.16%)
Banque Heritage
(6.78%)
Retail &
Institutional
(24.3%)
Sterling Energy
Corporate profile
5
www.sterlingenergyplc.com
32
Years
22 Years
Senior exploration, new ventures & management positions at Enterprise Oil,
Shell International, Marathon Oil & Apache (UK, US, Brazil and Australia).
Former Head of new ventures at Petrobras Oil & Gas BV (Africa focused
Private Equity JV). Mr Jersing has a BSc in Geophysics and an MSc in
Petroleum Geology from Imperial college.
Eskil Jersing
CEO*
Michael
Kroupeev
Non Executive
Chairman
Sterling Energy Board
Shareholder aligned (45% of fully diluted share positions represented)
Founding Director, Waterford Finance & Investments Ltd (Oil & Gas focussed
investment vehicle with shareholdings in companies with operations in Europe,
Africa, North America and Australasia)
Previously Non-executive director of Sibir Energy Plc & Dana Petroleum Plc
29
Years
Senior E&P executive with an MSc. in Petroleum Engineering from Delft
University, the Netherlands. Following a successful career with Shell
International, he has been involved in multiple successful business start ups of
scale including EDP ltd, TAQA Bratani (UK) Ltd and TAQA Iraq BV. Executive
Chairman at Columbus Energy Resources plc
Leo Koot
Audit, Remco
Chairman & NED
12
Years
Representing Mistyvale Ltd. Investor in Private equity and Venture capital
projects through Supremum capital and Concentric VC. Focus on finance and
real estate sectors in Russia and UK. Previously with JP Morgan, Barclays
capital and VEB capital in M&A, Corporate finance and capital markets. Mr
Belyaev has an MSc in Mathematics from Moscow State University.
Ilya Belyaev
NED
* Resigned 21 Dec-17
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www.sterlingenergyplc.com
Somaliland – Odewayne
Recently completed 1,000km 2D seismic program (first ever on block)
Joint Venture
− Genel (Operator) 50%, Sterling 34%, Petrosoma 16%
− Revised Farm-out terms with Petrosoma in April 2017
(US$8m contingent consideration cancelled for payment
of US$3.5m and transfer of 6% interest in the PSA)
Licence Terms and Commitments
− Carried by Genel for all costs in Periods 3 & 4 (to 1st
well)
− Period 3: May 2012 – November 2019
− Airborne gravity and magnetics survey - completed
− Acquire 500km 2D seismic data Q2 2017
− Period 4: November 2019 – May 2021
− Acquire 1,000km 2D seismic data
− Drill one exploration well
Onshore frontier exploration
− Huge onshore block of 22,840km², equivalent to +/- 100
UKCS Blocks.
− Low cost 2D acquisition, drilling and access to Berbera
deep water port less than 100kms to North
Odewayne - Sterling
Energy 34%
7
www.sterlingenergyplc.com
Somaliland - Odewayne
First mover advantage in unexplored Mesozoic rift basin
Pre-rift configuration Petroleum System
− Huge frontier exploration block with no
seismic control and no drilling to date
− Rift basin interpreted to be deep enough for
Jurassic source rocks to be mature (3.5km+),
possibly of Permo-Triassic Karoo age
− 32 deg API flowed to surface from Jurassic
carbonates in Daga Shabell-2 well (1959) to
the north of the block
− Active petroleum system confirmed by oil
seeps within the block
− Sub-surface basin structure identified by 2013
aero-magnetic survey; multiple 3-way fault-
controlled traps likely with sedimentary fill as
key unknown
Odewayne Basin
Petroleum system- Play elements
Source: Genel
8
www.sterlingenergyplc.com
Somaliland - Odewayne
First mover advantage in unexplored Mesozoic rift basin
2017 2D seismic program
− Government operated (MOEM) multi client 2D
seismic acquisition program contracted to BGP
− 3 month program, completed August 24th 2017
− 2D seismic program on Odewayne block exceeds
minimum work obligation for Period 3
− 1,001 kms full fold Vibroseis acquisition program
− Average production rate of 13kms / day
− 10 x 10 km grid over “basin areas” defined from
Potential fields (Gravity and Magnetics) data
− Reduced dip spacing infill lines to 5km as
required
− Phased Full Pre Stack Time migrated data (3 trial
line processing) completed in Q2 2018
2017 2D seismic program
Odewayne Basin
Vibroseis
9
www.sterlingenergyplc.com
2017 2018 2019 2020
Country Asset H2 H1 H2 H1 H2 H1
Growth / M&A projects
Somaliland
(Frontier)
Odewayne
(34%*) 2013 entry
2D Seismic and well costs
fully carried
Activity Timeline
Focus on transformative M&A driven growth
Note: Company estimates
Due diligence & execution
1,000 km 2D Seismic
Processing &
Regional Evaluation
Decision to
Enter Phase 4
10
www.sterlingenergyplc.com August 2015
Ancillary information January 2018
www.sterlingenergyplc.com
11
www.sterlingenergyplc.com
Sterling Management team
Senior exploration, new ventures & management positions at Enterprise Oil, Shell, Marathon &
Apache (lived and worked in UK, US, NL, Brazil and Australia). Former Head of new ventures at
Petrobras Oil & Gas BV (Africa focused Private Equity Joint Venture). BSc in Geophysics from
Cardiff University and MSc in Petroleum Geology from Imperial College London.
Eskil Jersing CEO*
Anish Airi Subsurface & Reservoir
Engineering Manager
James Munt Senior Finance Manager
Oil and Gas experience covering all aspect of finance and accounting, specialising in
Group and Joint Venture accounting. Focused on assets in Africa, Middle East and the US.
International upstream experience from numerous locations including Nigeria, Norway, Oman,
Kenya, Netherlands and Kuwait. He has worked for Shell International, Shell Trading, Nexen
International, MRI and was Technical Director EMEA at Macquarie Group. MSc in Chemical
Engineering from Imperial College London.
19 Years
32
Years
17 Years
Mary-Ann Page HR/Facilities Manager
Human resource professional specialising in the Oil and Gas sector. Managerial
experience focused on HR, HSE, IT, Facilities Management and Procurement. 34 Years
Simon Compton Head of Commercial &
Legal
31 Years
International upstream experience in 50 countries and 30 appraisal and development
projects, specializing in investment appraisal, petroleum economics and business
development. He has worked with BHP, Enterprise Oil, Hess, Premier Oil, Gulf Keystone
and BMO Capital. MSc in Sedimentology from the University of London.
* Resigned 21 Dec-17
12
www.sterlingenergyplc.com
Somaliland – Country Overview
Frontier opportunity
Government
– Somaliland (637,000 km2) was a UK protectorate from
1888 until 1960
– Declared independence from Somalia in 1991; allowed
development of a stable, democratic government
– Not recognised as an independent nation but
favourable political contacts with a number (ca. 35) of
countries including UK
– 26 years of Democratic elections & 4 Presidents
Economy (2014)*
− GDP: $1.4 billion (ca.$347 per capita)
− Real GDP increasing by 3.7% pa since 2014
− Livestock (10 million goats, 5 million sheep, 5 million
camels and 2.5 million cattle) provide economic back
bone (60-65% of Notional economy)
− Population 3.5 million
Oil & Gas
– Berbera Deepwater port ca 100kms from Odewayne
block
– Immature Exploration sector, No production to date
* Source World Bank
13
www.sterlingenergyplc.com
Sterling Energy
The journey to date
2003
Acquisition of
Fusion Oil &
Gas plc
2004
Chinguetti field,
Mauritania,
Funding & Royalty
agreement
2005
Farm out of
Ambilobe &
Ampasindava
blocks in
Madagascar to
XOM
2006
First production
from Chinguetti
oil field ,
Mauritania
2009
Share placing
and Board
changes
following sale of
US business
2010 Sangaw North
well drilled in
Kurdistan (fully
carried)
2013
Ambilobe block,
Madagascar
farm out to Pura
Vida
2015
C-3 block Mauritania
farm-in with Tullow
(ground floor)
C-10 block Mauritania
farm-in / entry with Tullow
(ground floor)
Ambilobe block
Madagascar Operated 3D
survey (fully carried)
Ampasindava block
Madagascar
relinquishment (disciplined
data driven decision)
2007
Acquisition of
Whittier Energy
corporation Gulf
of Mexico assets
(USA)
2008
Themis Admiral
Marin & Iris
Charlie Marin
wells drilled
Gabon
2016
C-3 block Mauritania
exit (post new 2D
evaluation – disciplined
data driven decision)
Ambilobe block
Madagascar exit (post
new 3D evaluation –
disciplined data driven
decision)
Ntem, Cameroon exit
(disciplined
relinquishment based
on remaining
prospectivity vs. work
commitments)
Odewayne, Somaliland, Revised Farmout terms to cancel contingent payments to Petrosoma
2017
Shareholder led Board
Capital restructuring
Chinguetti end of field life and
Abandonment &
Decommissioning
Odewayne, Somaliland, Revised
Farm-out terms to cancel
contingent payments to
Petrosoma. Completion of
1,000kms 2D
C-10 block Mauritania exit
(disciplined commercial
decision)
2002 Listed on
AIM
2014
Bamboo well
drilled in Ntem
block Cameroon
(fully carried)
Two-stage
Odewayne
block,
Somaliland
farm-in, (carried
in phase III & IV)
MATERIAL EXPLORATION PORTFOLIO RATIONALIZATION AND MATERIAL M&A
2018
Chinguetti Funding
agreement exit
14
www.sterlingenergyplc.com August 2015
website www.sterlingenergyplc.com
e-mail: [email protected]
52-54 High Holborn, London, WC1V 6RL
Tel: +44 (0) 20 7405 4133
Fax: +44(0) 20 7440 9059