DNO PRESENTATION APRIL 2000 - Hugin Onlinereports.huginonline.com/777494.pdf · 2019-07-16 · DNO...

transcript

DNO PRESENTATION

APRIL 2000

DNO PRESENTATION

APRIL 2000

Introduction

Historical Review

Heather & Yemen Projects

Norway

Future Development

Introduction

DNO BUSINESS STRATEGY

TAIL-END PRODUCTION

SMALL OIL FIELDS

Concepts and strategy

• Value creation by combining smalldiscoveries into unitized producingclusters of at least 10 years

• Value creation by extending the lifeof producing fields based onimproved subsurface understandingand technology

• Participate in exploration of satelliteprospects in relation to producinginfra structure

• Be a wanted supplementarycompany that focus on the 2nd handmarked

Volumeknowledge

t largeandsmall

Type ofcompany:

Large andsmallprospects

Large fieldsand prospects

Smalldiscoveriesand tailend

Mature/combination

Growth/extraction

Creation/experimentation

DNO E & P ACTIVITIES

Russia: 1 License with large provenoil reserves. UK YemenNorway

Heather Jotun

Russia

JotunTasour

Yemen: 2 Licenses - Operator for Tasour Development 1.000 B/D fm. 4 Q 2000

UK: 5 Licenses - Operator for Heather Area - 5.000 B/D

Norway: 3 Licenses - 1.850 BOPD

DNOBRITAIN LTD.

DNO GROUPDNO ASA

DNOYEMENDNO

YEMENDet Norske

Oljeselskap ASDet Norske

Oljeselskap AS

Offshore &Services

PDR 34.0 % IOT 100.0 % Clampon 24.5 %

Block 32 20.00 %Block 53 24.45 %

DNO ASA - Corporate Structure

Heather (2/4+2/5) 100 %Claymore 1%Solan 205/26a 3.7%210/29a 100 %

Jotun Field 1.250 %Tor Field 8.737 %Glitne& Enoc 10.000 %

Oil & GasOil & Gas

DNO ASABoard Of DirectorsDNO ASA

Board Of Directors

BERGE G. LARSENGroup Chief Executive Officer

HELGE EIDEGroup Chief Operating Officer

BERGE G. LARSENGroup Chief Executive Officer

HELGE EIDEGroup Chief Operating Officer

Det Norske Oljeselskap ASTORSTEIN SANNESS

General Manager

Det Norske Oljeselskap ASTORSTEIN SANNESS

General Manager

DNO BRITAIN LTD.DR. STEWART WATSON

Chief Executive Officer

DNO BRITAIN LTD.DR. STEWART WATSON

Chief Executive Officer

DNO YEMENMAGNE NORMANN

General Manager

DNO YEMENMAGNE NORMANN

General Manager

DNO – Group OrganizationFig.10

10 105 10

10= number of collaborators Total work force : 130

Operational technology network

GEOLOGY OG GEOPHYSICS

MERCANTILE SUPPORT

RESERVOIR

WELL TECHNOLOGY ANDDRILLING

DEVELOPMENT ANDOPERATION

SAFETY/ENVIRONMENT

IT/DESIGN

Historical Review

JUNE 1996NEW MAIN SHAREHOLDER - NEW MANAGEMENT -NEW STRATEGY

JULY 1997OPERATOR FOR HEATHER FIELD UK

NOVEMBER 1998OPERATOR FOR BLOCK 32 YEMEN

FEBRUARY 2000RE-ENTRY TO NORWAY

MAIN EVENTS 1996 - 2000

Reserves

020406080

100120140160

1995 1996 1997 1998 1999

Mill barrels

Oil ProductionMill

barrels o.e./day

1995 1996 1997 1998 1999 4thQv. 1999

Revenue Development

NOK 1000

Oil and gas Offshore & Services

1995 1996 1997 1998 1999

Financial Performance - Net Profit

NOK 1000

1995 1996 1997 1998 1999-100

PDR ASA EFFECT:

(44 MILL.)

THE HEATHER

PROJECT

Greater Heather Area2/52/4 3/1

19BEATRICE

1207ShetlandIslands

CLAYMORE

CAPTAIN

ROSSTARTAN

DAUNTLESS

DURWARD

BUCHAN

KITTIWAKEFORTIES

BRITANNIA,ALBA

HEATHERPELICAN

CORMORANTHUDSON

EMERALDNINIAN/

COLUMBA

BRAE AREASEDGWICK

ELGIN,FRANKLIN

ETAPGUILLEMOT

GANNET

BRUCENESSNEVIS

DUNBAR

CURLEW

10FRIGG

BERYLGRYPHON

HARDING

EAST BRAE

T BLOCK

MILLERKINGFISHER

LARCHBIRCH

MAUREENARMADA

BALMORAL,GLAMIS, STIRLING

MURCHISONSTATFJORD

STRATHSPEYALWYN NORTH

30MACHARERSKINE

EVEREST

PIERCELOMOND

MONTROSE,ARBROATHNELSON

HUTTON / NW HUTTON

JOANNE/JUDY

19BEATRICE

1207ShetlandIslands

CLAYMORE

CAPTAIN

ROSSTARTAN

DAUNTLESS

DURWARD

BUCHAN

KITTIWAKEFORTIES

BRITANNIA,ALBA

HEATHERPELICAN

CORMORANTHUDSON

EMERALDNINIAN/

COLUMBA

BRAE AREASEDGWICK

ELGIN,FRANKLIN

ETAPGUILLEMOT

GANNET

BRUCENESSNEVIS

DUNBAR

CURLEW

10FRIGG

BERYLGRYPHON

HARDING

EAST BRAE

T BLOCK

MILLERKINGFISHER

LARCHBIRCH

MAUREENARMADA

BALMORAL,GLAMIS, STIRLING

MURCHISONSTATFJORD

STRATHSPEYALWYN NORTH

30MACHARERSKINE

EVEREST

PIERCELOMOND

MONTROSE,ARBROATHNELSON

HUTTON / NW HUTTON

JOANNE/JUDY

Heather Alpha

Main FieldSatellitesProspect

LOCATION: BLOCK 2/4 & 2/5 UKCS

OPERATOR: DNO (100 %)

START OF PRODUCTION: 1978

TOTAL PRODUCED RESERVES: 122 MILL. BBLS

ESTIMATED REMAINING RESERVES: 80 MILL. BBLS

CURRENT PRODUCTION: 4.750 BOPD

BBL/DAY

��

2000 2002 2004 2006 200819981996199419921990198819861984198219801978

10.000

15.000

20.000

25.000

30.000

35.000

COP ??

1996REVIEW

• FIELD APPROACHING CESSATION OF PRODUCTION

Heather Production History

• PARTNER MIS-ALLIGNMENT

License Partners 1975-1997

Heather Field Partner Arrangements

License Partners 1997 - 1999:

Unocal – Operator (31.25 %)

Texaco (31.25 %), British Gas (31.25 %), DNO (6.25%)

DNO – Operator (37.5 %)

Texaco (31.25 %), British Gas (31.25 %)As of October 1999:

DNO - Operates on 100 % basis

Texaco, British Gas “Sleeping Partners”

New 3-D Seismic for the Main Field

INVESTMENTS 1997 – 1999 (DNO 100 %)

Re-evaluation of the Heather Area

Re-activation of Platform Drilling Rig

GREATER HEATHER AREA RESERVES

2/52/4

Heather Alpha Platform

Main Field

Satellites

ESTIMATED RESERVES

80 MILL. BBLS

ESTIMATED RESERVES

80 MILL. BBLS

Main Field

West Heather

North Terrace

South-West Heather

South Terrace

New Prospect100 + mill bbls

potential

New Prospect100 + mill bbls

potential

Greater Heather Area

Development Plan March 2000

10.000

15.000

20.000

25.000

30.000

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

W HeatherTriassicNorth TerraceCompartmentsInfillBaseline

2/52/4 3/1

Heather Area Conceptual Development PlanMarch 2000

Development of 48 mill. barrels of Reserves

Production until 2010 !

Heather Field

North Terrace

West Heather

BBL/DAY

��

��2000 2002 2004 2006 200819981996199419921990198819861984198219801978

10.000

15.000

20.000

25.000

30.000

35.000

ANNUAL “BASELINE” OPEX£ MILL.

25 % REDUCTION

£ 5 MILLION PERANNUM

DNO BECAME OPERATOR

Heather Field Opex

BBL/DAY

��

2000 2002 2004 2006 200819981996199419921990198819861984198219801978

10.000

15.000

20.000

25.000

30.000

35.000

Heather in Summary

REMAINING RESOURCES COMBINED WITH COST REDUCTION FORMS THE BASISFOR AT LEAST 10 YEARS EXTENDED PRODUCTION FROM HEATHER .

CONTINUED PRODUCTION FROM HEATHER ALLOW FOR FURTHEREXPLORATION AND APPRAISAL OF THE GREATER HEATHER AREA.

10 YEARS DEFERRAL OF PLATFORM DECOMMISSIONING REPRESENTSSUBSTANTIAL ADDITIONAL VALUE TO THE ASSET.

THE TASOUR

PROJECT

YEMENBlock 32 Location Map and Regional Setting

100 km

Saudi Arabia

Gulf of Aden

Red Sea

Africa

Ras Issa

Bir Ali Terminal

Ash Shihr TerminalAL MUKALLAH

Marib - Jawf - Shabwa Basin

Sayun - Masila Basin

Jeza Basin

Block 32

DNO - 20 % and Operator

Norsk Hydro - 25 %

Ansan Wikfs - 44,5 %

Transglobe Energy - 9,5 %

Block 32 Partners

Tasour Area

Abiyeet-1

Rudood-1 North Hemiar-1

Atheib-1

Tasour-1,2,3,W-1

Block 53Dove Energy

Block 32DNO

Yashaar B Yashaar Lead 1

Yashaar Lead 2

Tasour F Tasour D

Tasour EastTasour CTasour BTasour West

Tasour G

Block 14Canoxy

65 kmConnecting Pipeline

to Canoxy

65 kmConnecting Pipeline

to Canoxy

DNO LICENSES - REPUBLIC OF YEMEN

Tasour 1Oil Test4.800 b/d

Tasour 1Oil Test2.200 b/d

Tasour 1Oil Test

2.200 b/d

BLOCK 32DNO 20 %

(OPERATOR)

BLOCK 32DNO 20 %

(OPERATOR)

TOTAL20.000 b/d

CANOXY200.000 b/d

Pipeline400.000 b/d

capacity

Pipeline400.000 b/d

capacity

BLOCK 53DNO 24.45 %BLOCK 53

DNO 24.45 %TASOUR LOCATIONTASOUR LOCATION

YEMENBlock 32 Area - Production & Infrastructure

TASOUR 3 DRILLING SITE - BLOCK 32 YEMEN

��

YEMENTasour Area Prospects and Leads

Yashaar Lead 2

Yashaar C

Prospect2/Gamma

Wadi Sana-1

North Hemiar-1Atheib-1

Tasour East

Abiyeet-1

Yashaar B

Yashaar A

Tasour F

Tasour CTasour BTasour West

Tasour G

Shariouf A

Shariouf B

Mishtah-1

Darbah-1Darbah-1A

Mishtah B

Qishn S1 Structural Trap?

Atheib E

Mishtah D

Wadi Sana-B

Wadi Sana-C

Tasour D

North Hemiar Atheib

Development Area

��

65 km Pipeline

P-50: Oil Production Profile

10 000

12 000

jul.00jan.01jul.01jan.02jul.02jan.03jul.03jan.04jul.04jan.05jul.05jan.06

YEMENTasour B Production Profile (100 %)

8 mill. barrels

��

YEMENTasour Area Prospects and Leads

Yashaar Lead 2

Yashaar C

Prospect2/Gamma

Wadi Sana-1

North Hemiar-1Atheib-1

Tasour East

Abiyeet-1

Yashaar B

Yashaar A

Tasour F

Tasour CTasour BTasour West

Tasour G

Shariouf A

Shariouf B

Mishtah-1

Darbah-1Darbah-1A

Mishtah B

Qishn S1 Structural Trap?

Atheib E

Mishtah D

Wadi Sana-B

Wadi Sana-C

Tasour D

North Hemiar Atheib

Development Area

��

65 km Pipeline

F Structure

D Structure

P-50 + Tas.D&F (risked)

jul.00

jan.01

jul.01

jan.02

jul.02

jan.03

jul.03

jan.04

jul.04

jan.05

jul.05

jan.06

+ Tas.D and F

P-50 Base Case

YEMENTasour B, D and F Production Profile (100 %)

12 mill. barrels

Development plan filed Dec. 99’

Production start up 4 Q 2000

Close to existing infrastructure - low development costs

Located in area with substantial oil production

YEMEN BLOCK 32

NORWAY

“DNO will build on it’s valuable experience andexpertise from Heather and Tasour”

RE-ENTRY TO NORWAY

Opportunities

• Imbalance between the three enabling factors; intellect, land and capital create a negative spiral

• Small fields have become larger

• Two decades of outsourcing have made technology an equal commodity for small and large companies

• Competition related to why and where instead of how

Concepts and strategy

• Value creation by combining smalldiscoveries into unitized producingclusters of at least 10 years

• Value creation by extending the lifeof producing fields based onimproved subsurface understandingand technology

• Participate in exploration of satelliteprospects in relation to producinginfra structure

• Be a wanted supplementarycompany that focus on the 2nd handmarked

Volumeknowledge

t largeandsmall

Type ofcompany:

Large andsmallprospects

Large fieldsand prospects

Smalldiscoveriesand tailend

Mature/combination

Growth/extraction

Creation/experimentation

Areas of interest in Norway

• Mature part of North Sea south of 60°N

• Discoveries with low GOR

• Upper Cretaceous fields and discoveries

Tor Field (Tor Unit) Location mapOperator Phillips : 32.02 %DNO Share : 8.74 %

Other Licensees:TotalFina/Elf : 41.01 %Agip : 11.30 %Norsk Hydro : 5.80 %Statoil : 1.13 %

License expiry 2028

Top Ekofisk Fm. depth

Production history

078 1082 86 90 94 98 02 06

vertical scale: 1000 Sm /day3

Seismic

Geoprofile

S N8x E16

Seismic

Geoprofile

RESERVES MMBBL/BSCF

STOOIP : 817/1215

Produce : 132/478

Remaining res : 40/64

• Identify discoveries with similar oil properties

• Identify movable production units in relation to subsurface conditions

• Create common incentive to maximize value for licensees

The cluster concept

- Large energy companies

- Petroleum commodity

- Growth by acquisition and merger

- Lack of reserve replacement for oil, balance for gas

- Shift to low cost areas

- Triple bottom line accounting

2500 -

2000 -

1500 -

1000 -

0 -1988 1990 1992 1994 1996 Year

Liquids Production v. Reserves Added(excluding North America) Liquids

Total 1988 - 97: 200.936 1993 - 97: 103.046

Recoverable Reserves (MMb)

State Take in Low Cost Areas at $ 10/b100 -

85 -80 -75 -

50 100 200 500 1000 2000

5.0 -4.0 -3.0 -2.0 -

1.0 -0.0 -

b)Recoverable Reserves (MMb)

North Sea

Gulf of Mexico

S. E. Asia

South America

West Africa

Middle East

Field Development Costs ($/b, 1999)

10 25 50 100 250 750

Mega Trends in the Petroleum Industry

Replacement

Production

Venezuela

Volume of LiquidsTotal 1988 - 97: 86.567 1993 - 97: 32.046

Cluster production

AVERAGE

Characteristics:- Size 15 - 50 mill. bbl- Number 20 - 50 low GOR- Small margins between expected and min. economic reserves- 3D requirement, but not sufficient- Low relief and sensitive to time depth conversion- High productivity

Challenges:- Holistic agreement among companies across licenses boundaries- Increased volume to sustain failures- Timing of out-and in-phasing of fields

Production forecast

Glitne

TorJotun

Potential for cluster growth

present identified

Cluster v.s. conventional development

1 2 3 4 5 6 7 8 9 year

G NOK 3

Accumulated cash flow before taxPaleocene, 3 x 33 mill bbl., cluster

Paleocene, 100 mill bbl., conventional

DNO strategy in Norway

• Supplementary company

• Value creation by cluster production of small discoveries

• Extend the tail end production by reduced costs and increased reserves

• Participate in exploration in relation to producing infrastructures

• Active partner with the potential of being a network operating company in the future

DNO experience

• Good dialog with oil companies and contractors

• Alternate ways of obtaining production

• Alternate ways of remuneration- direct payment- profit sharing- carrying of exploration

• Strengthen position by actions

Operational technology networkGEOLOGY OG GEOPHYSICS

PGSGeco/Schlumberger

TechnoguideAPT

Geo NorgeAker Geo

TGS NopecLong Island

Nordang ExplorationPetroteam

MERCANTILE SUPPORT

Arthur AndersenDNB Markets

First SecuritiesChase

Citicorp

RESERVOIR

RDSTechnoguide

ROXARRogalandsforskning

TriangelPGSRWS

WELL TECHNOLOGY ANDDRILLING

RogalandforskningTriangel

Heather operasjoner:Sperry SunDrill QuestHalliburtonBaker AtlasABB VetcoCairntoul

BaroidCamcoT.I.W

DEVELOPMENT ANDOPERATION

AkerKværner

ABBUmoe

BergesenPGS

Fred Olsen EnergiOffshore Design

SAFETY/ENVIRONMENT

Rogaland ConsultingTriangel

ScanpowerIPRES

IT/DESIGN

TelecomputingNexthood

Oskarsen tegning og designBarebra

ActiveDialog

The network company

Det Norske Oljeselskap AS - Functional intern network

The DNO Safety Management System is designed to:

• Protect the safety and welfare of everyone engaged in activitieson behalf of the company.

• Meet legislative and regulatory requirements.

• Minimise financial loss caused by accidents, unplanned downtimeof equipment, and loss of fluid containment.

• Provide a means of monitoring and measuring performance toenable lessons to be learnt.

• Facilitate continuous overall business improvement.

DNO Heather LimitedSafety Management System

DNO Safety Management SystemOverall Structure

• Board Policy Statement.

• Management System Policy Manual.

• Procedures Manual.

• Detailed Work Instructions.

• Reporting/Communication.– Toolbox Meetings– Dedicated Safety Meetings– Forms (Injuries, Losses, Non Conformance, Dangerous

Occurrences, Near Misses)

• Investigations.

• Action Plans.

• Continuous Improvement.

DNO Heather LimitedHS&E Operational Performance

1997 1998 1999Unplanned Facilities Downtime (%) 0.025 0.056 0.054Unplanned Facilities Downtime (hrs) 2.2 4.9 4.7

Lost Time Accidents 2 1 1Dangerous Occurrences 7 3 7Loss/Damage Reports 18 15 8Medical Treatment Cases 0 3 1First Aid Cases 1 1 0Near Misses 4 2 2

TOTAL 32 25 19Volume Gas Flared (MMscf) 312 163 90Number of Oil Spills/Sheens 4 2 4Total Volume Spilled (bbls) 0.7 2.8 1.8Oil-in-Water Discharge (ppm) 31 29 26

Future Development

Company Growth

based on

Current Projects

Heather - Yemen - Norway

Mill barrels

North Sea

OIL RESERVES AS OF 1 Q 2000

4 Q 1999 1 Q 2000 1 Q 2001 1 Q 2002 1 Q 2003 1 Q 2004

Y E ME N

N O R W A Y

BARRELS / DAY

PRODUCTION FORECAST FROM CURREENT PROJECTS

Trippel Oil Production within 2-3 years

from current projects

GROWTH POTENTIAL

Capitalize on the window of opportunity onNCS and UKCS

DNO IS WELL POSITIONED FORGROWTH !

USD/BOE

EnterpriseOil

LASMO BritishBorneo

EuropeanE&P

(median)

ENTERPRICE VALUE PER BARREL OIL

Proven + Probable

North Sea Reserves

Current Projects

60 % of NS

Reserves54 mill. barels

Source: Sundal & Collier

DNO PRESENTATION APRIL 2000 - Hugin Onlinereports.huginonline.com/777494.pdf · 2019-07-16 · DNO...

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