10 11 12 URS Oil Gas Division Presentation

7/30/2019 10 11 12 URS Oil Gas Division Presentation

http://slidepdf.com/reader/full/10-11-12-urs-oil-gas-division-presentation 1/21

Oil & Gas Division Overview

October 11, 2012



2

Forward Looking Statements

Statements contained in this presentation that are not historical facts may constitute forward-looking statements, including

statements relating to future financials, future business projects, future backlog and book of business and future business,

economic and industry trends. We believe that our expectations are reasonable and are based on reasonable assumptions; however, we caution against relying on any of our forward-looking statements as such forward-looking

statements by their nature involve risks and uncertainties. A variety of factors, including but not limited to the following,

could cause our business and financial results, as well as the timing of events, to differ materially from those expressed or

implied in our forward-looking statements: declines in the economy or client spending; changes in our book of business;

our compliance with government regulations; impairment of our goodwill; integration of acquisitions; employee, agent or

partner misconduct; our ability to procure government contracts; liabilities for pending and future litigation; environmental

liabilities; changes in commodity prices; availability of bonding and insurance; our reliance on government appropriations;

unilateral termination provisions in government contracts; our ability to make accurate estimates and assumptions; our

accounting policies; workforce utilization; our and our partners' ability to bid on, win, perform and renew contracts and

projects; liquidated damages; our dependence on partners, subcontractors and suppliers; customer payment defaults; our

ability to recover on claims; impact of target and fixed-priced contracts on earnings; the inherent dangers at our project

sites; the impact of changes in laws and regulations; nuclear indemnifications and insurance; misstatements in expert

reports; a decline in defense spending; industry competition; our ability to attract and retain key individuals; retirement

plan obligations; our leveraged position and the ability to service our debt; restrictive covenants in our credit agreement;

risks associated with international operations; business activities in high security risk countries; information technology

risks; natural and man-made disaster risks; our relationships with labor unions; our ability to protect our intellectual

property rights; anti-takeover risks and other factors discussed more fully in our Form 10-Q for the period ended June 29,

2012, as well as in other reports subsequently filed from time to time with the United States Securities and Exchange

Commission. The forward-looking statements represent our current intentions as of the date on which they were made

and we assume no obligation to revise or update any forward-looking statements.



3

FY 2011 Contract Risk Profile

FY 2011 Revenue by Service Offering

TechnicalServices

ProjectDevelopment

ProgramManagement

IT ServicesPlanning,Design &

Engineering

Construction& Management

Operations &Maintenance

Decommissioning& Closure

Reimbursable

Cost(1)

FixedPrice(2)

Engineering

&

TechnicalServices

Operations

&Maintenance

ConstructionManagement

&

Construction

Notes: (1) Reimbursable contracts include: Reimbursable, Time & Materials and Target Price contracts(2) Fixed Price contracts include: Firm Fixed-Price and Fixed-Price Per Unit contracts. URS has minimum exposure to “lump sum” turnkey projects

Diversified Business Mix with Full ServiceCapabilities

49%

19%

7%

12%

13%

Federal

FY 2011 Revenue by End Market

Infrastructure

Oil & Gas (>20% including Flint)

Power

Industrial



Oil & Gas Operational Footprint

83 Locations

11,000 Employees

4



Full-Cycle Energy Services

OILFIELD

SERVICESUS & Canada

PRODUCTION

SERVICESUS & Canada

FACILITY

CONSTRUCTIONCanada

MAINTENANCE

SERVICESCanada

Upstream Downstream Refining

Early Cycle Late Cycle

Midstream Production

5



Key services offered in both Canada and United States:

Rig moving, setup, and tear down

Fluid hauling – produced oil, waste and completions

fluids

Pressure and vacuum services – well and facilitiescleaning

Oilfield equipment hauling – well drilling consumables

URS is one of the largest rig movers in North America

6

Oilfield Services Activities



Rig Moving

US and Canadian rig counts

Weekly average number of working rigs (publishedweekly on Bakerhughes.com)

Wells Drilled

Monthly number of wells drilled in Canada and US(published on EIA website, Industry newsaccumulators)

Capital Spending

Annual industry capital spending forecasts(published by Spears & Associates; CAPP -Canadian Association of Petroleum Producers)

7

Oilfield Services Business Drivers



Rig moving for Fortuna in the Marcellus shale gasplay, Morgantown, PA

Fluid hauling contract with EOG Resources in theEagle Ford shale gas play in S.E. Texas

Pressure & vacuum Service work for Husky Energy,

Lloydminster, Alberta

8

Oilfield Services Projects



Key services offered in Canada and US:

Pipelines – well tie-ins, gathering lines & transportationpipelines

Construction – field & mechanical, electrical &instrumentation

Maintenance – field & plant maintenance

Tubular Management – inspection, repair,refurbishment, storage of OCTG and drill pipe (Canadaonly)

Fabrication Equipment – process equipment (US &Canada), polyethylene pipe, internal & external wear coatings (Canada)

URS is the largest midstream production

services company in North America

9

Production Services Activities



Oil and Gas Prices Determine capital spending for new wells and

infrastructure (Wall Street Journal – oil and gasfutures prices; industry forecasts)

Customer-Specific Regional Capital Spending

Annual budgets communicated by customers, tied tooil and gas prices, weather and seasonal access,available manpower and equipment constraints

Wells Drilled

Pipeline and field facilities construction typically lagdrilling by 6 - 9 months

10

Production Services Business Drivers



Pipeline Project

Saskatchewan’s Bakken shale oil resource play

Field Facility

EnCana Kiwigana Compressor Station, Phase 1C,North East BC

Field Facility

Imperial Oil Horn River, BC Pilot Plant Facility

11

Production Services Projects



Major project construction services include:

Project planning & management

Module fabrication & field installation

Workforce mobilization

Field construction management

General construction & commissioning

Current Contracts:

MEG Energy – Christina Lake Phase 2, field construction

ConocoPhillips – Surmont Phase 2, field facilities &pipeline construction

CNRL – Kirby Lake, module fabrication

URS is one of the largest fabricators of

oil sands equipment modules in Alberta

12

Facility Construction (Oil Sands)



Global Crude Oil Demand

Oil sands projects have higher hurdle rates and longer planninghorizons

Short-term fluctuations in prices do not impact project decisions

Current production of 1.5 M barrels/day to increase to 3 M barrels

per day with planned expenditures

Industry Capital Expenditures

Current spending is $20 B, expected to increase to $22 B per year

Expect $200 B in proposed projects planned in the next 10 years

Construction Costs & Capacity Constraints

As more projects sanctioned, greater competition for constructioncapacity increases costs

Increased need for detailed engineering, careful scheduling, and

partnering with experienced contractors

13

Facility Construction Drivers

Source: Peters & Company, January 2011



MEG Energy Christina Lake Phase 2B

Phase 2 SAGD facility, building central processingfacilities, $150 M, 2 year contract currently underway

ConocoPhillips Surmont Phase 2 Phase 2 SAGD facility, building central processing

facilities, $430 M contract, currently underway

CNRL Module Fabrication

Building process and equipment modules for MackayRiver Expansion Project, $30 M contract completedin 2012

14

Facility Construction Projects



URS JV is one of the top two maintenance

contractors in the oil sands region

Provide asset management and maintenance servicesto large oil sands producers and oil refineries:

Site-wide general maintenance

Turn-around planning and execution Sustaining capital projects

Management of third party maintenance services

Current multi-year customers include:

15

Maintenance Services Activities

CNRL

Exxon

Nexen

Suncor



Bitumen Production

As activities increase, so does maintenance spending

Turn-Arounds & Shutdowns

Maintenance activities occur every two years at major projects and increase maintenance spending

Planned Maintenance

Customers invest in more planned maintenance toreduce overall maintenance costs per flowing barrel

16

Maintenance Services Business Drivers



Suncor Energy, Oil Sands

5 year maintenance contract awarded in 2007, renewed

Oilsands, Firebag (SAA) & Sarnia Maintenance

contracts in 2012, with General Construction and Turn

Around contracts renewed through 2013

CNRL, Horizon

2 year evergreen contract awarded in 2010

Nexen, Energy, Long Lake

3 year contract awarded in 2010

Imperial Oil, Kearl Lake

5 year contract awarded in 2011, currently in startup

phase

17

Maintenance Services Projects



-

400

800

1,200

1,600

2,000

2,400

-

100

200

300

400

500

600

700

800

2005 2006 2007 2008 2009 2010 2011 2012p 2013f

U S A

R i g s

C a n a d i a n R i

g s

Canadian Active Rigs US Active Rigs

2011 Actual

419 active rigs

11,368 wells

2012 Projected

368 rigs

10,279 wells

2013 Forecast

396 rigs

11,009 wells

Sources: Historical rig counts - Baker Hughes, Nickle’s Energy Canadian & US forecast – Spears & Associates, Drilling & Production Outlook, September 2012

2011 Actual

1,872 active rigs

45,351 wells

2012 Projected

1,942 rigs

44,086 wells

2013 Forecast

2,005 rigs

46,726 wells

Sep 16, 2012US rigs = 1,864

Can rigs = 354

US 76% OilCAN 72% Oil

18

North American Drilling



Current capital spending is estimatedat $20 B expected to increase to $22 Bin 2014

Expected $200 B in planned projects to

increase production from 1.5 to 3.0 Mbarrels of oil per day

Syncrude, Suncor Energy, Shell,Exxon, Husky and ConocoPhillips are

the largest producers of oil sandstoday

0

5

10

15

20

25

C $

B

i l l i o n s

In-situ Mining Upgraders

Source: Peters & Company, January 2011

19

Projected Oil Sands Capital Spending



$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

2009 2010 2011 2012E 2013F 2014F 2015F 2016F 2017F 2018F

$ B i l l i o n s

M i l l i o n B b l / D a y

Production Opex

2011 Bitumen production ~1.7 Mbbl/day and annual maintenancespending ~$3.6 B

Bitumen production expected to

increase 47% to ~2.5 M bbl/day by2015

Annual maintenance spendingprojected to increase 39% to

~$5.0 B by 2015

Sources: CAPP - oil sands production forecast, June 2012Maintenance spending - Peters & Company , January 2011

Forecast Oil Sands Production and Maintenance Spending

20

Projected Oil Sands Maintenance Spending



www.urs.com

NYSE: URS

Corporate Headquarters:

600 Montgomery Street, 26th Floor

San Francisco, CA 94111

[email protected]

Date post:	04-Apr-2018
Category:	Documents
Upload:	srkm
View:	214 times
Download:	0 times

10 11 12 URS Oil Gas Division Presentation

Documents