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TRANSCRIPT
Lundin Petroleum
Proposed Spin Off
into EnQuest PLC
of UK Business
March 2010WF10929
1
Petrofac - Lundin Petroleum - EnQuest
WF10933 p1 03.10
Petrofac
UK ListedMarket Cap 5.5 Billion USDService Operations WorldwideUpstream Operations in UK Malaysia North Africa
Swedish ListedMarket Cap 2.5 Billion USDUpstream Operations in Europe Russia South East Asia Africa
2
Petrofac - Lundin Petroleum - EnQuest
WF10933 p2 03.10
Petrofac
Producing FieldsHeatherBroomThistleDeveron
Producing Fields
UK ASSETS UK ASSETS
Don West SW Don
Undeveloped DiscoveriesPeikScoltySW Heather
Undeveloped Discoveries
Various Exploration AssetsVarious Exploration Assets
Elke
3
Petrofac - Lundin Petroleum - EnQuest
WF10933 p3 03.10
Assets transferred to EnQuest free of debt
Petrofac
UK Assets UK Assets
4
Petrofac
UK Assets UK Assets
PetrofacShareholders
Lundin PetroleumShareholders
45% 55%
Petrofac - Lundin Petroleum - EnQuest
WF10933 p4 03.10
EnQuest shares listed on main board of London Stock Exchange andsecondary listing on NASDAQ OMX Stockholm
5
Deal Rationale
WF10930 p3 03.10
Crystallise value for Lundin Petroleum shareholders
Exposure to a new UK North Sea focused Company
Critical mass, strong balance sheet & proven management team
Grow through exploitation of existing asset base and a proactive acquisition strategy
BY
WITH
TO
6
EnQuest Assets
WF10930 p5 03.10
6 Producing fields
Strong balance sheet Undrawn borrowing facilities
2009 pro forma production 13,620 bbl/d
2P Reserves as at 1 January 2010 of 80.5 MMbbl
Contingent Resources as at 1 January 2010 of 67.5 MMbbl & 30.6 Bcf
16 Licences on the UKCS
UK
Norway
211
210
3
33
2
3
5
2
17
4b
18
5
1b
11b
28b30b
24c
16b
25b
26a
19a
3b
23b
29b
1a
24a
20e
9d
19a
4b
23d
27a
20a
4a3a
14
19b
28b
5F1
29b28a
3F1
2F1
29F1
21b
24c21a
25a
13aF2
29c
15a
22b
12b
30b
22aNW
23a
4c
9
16a
26aF1
22aSE21aF1
29a
18c
27f
8
30a
27e
13b
4a
27b
27g
24a24b
28a
4aF3
24b
29c
19aF3
29a
23a1
18a
19b
18aF1
9g
18aF4
23a2F1
26b
23a2
25b
4aF1
2F2
9bF1
23a1F2
10a
24aF1
18aF5
23c
16c18aF2
27c
4aF2
27d
9f
20f
23a3
23b
13aF1
1aN
20d
21aS
18aF6
26aW
18aF3
LYELL
TERN
BRENT OIL
PELICAN
HUTTON NW
DUNLIN
BRENT GAS
STATFJORD (NORWAY)
HUTTON
HUDSON
CORMORANT
EIDER
CORMORANT AREA
PENGUIN
DELTA
OTTER
KERLOCHMERLIN
KESTREL
SKYE
003/03 (Area 11)
PLAYFAIR
MAGNUS SOUTH
HEATHER SW
MELVILLE
DUNLINEAST RINNES
BARNACLE
DON SWDON West
HEATHER
BROOM
THISTLE / DEVERON
Petrofac LicenceLundin Petroleum LicenceOil fields
0 KM 20
7
Experienced Board and Management Team
WF10930 p6 03.10
Experienced Board and Management team
Jim Buckee, Non-executive ChairmanAmjad Bseisu, CEONigel Hares, COOJonathan Swinney, CFOAlex Schneiter, Non-executive Director
J. Buckee and N. Hares were core of team that built Talisman Energy over last twenty years
A. Bseisu, currently CEO of Petrofac Energy Developments
J. Swinney, Head of M&A at Petrofac
A. Schneiter, Chief Operating Officer Lundin Petroleum
8
Secondary Offering
WF10932 p1 03.10
The Lundin family will own ~17.5% of EnQuest pre secondary offering
Petrofac’s CEO (Asfari) and COO (Semaan) will own ~12% of EnQuest pre secondary offering
To facilitate liquidity in EnQuest the Lundin family, Asfari and Semaan may sell a portion of their EnQuest share to institutional investors in a secondary offering
The Lundin family will remain the largest individual shareholder in EnQuest even post secondary offering
9
Swedish Considerations
WF10932 p2 03.10
Secondary listing on NASDAQ OMX Stockholm
Tax efficient distribution of shares in EnQuest to Lundin Petroleum shareholders through application of Lex Asea rules
EnQuest prospectus available through Lundin Petroleum websitefrom 18 March 2010
Lundin Petroleum EGM on 22 March 2010
10
Lundin Petroleum’s UK History
WF10932 p2 03.10
Acquired UK assets in 2004 USD 163.5 MM
Capital expenditure up to year end 2009 USD 595 MM
Post-tax operating cash flow up to year end 2009 USD 945 MM
2P reserves increased by ~100% from 2004 to present date
11
Crystallisation of Value
WF10927 p6 03.10
Carrying value of UK assets
USD 285 million
55% ofEnQuest
Value above USD 285 million
to be booked as profit
12
Value of Distribution to Lundin Petroleum Shareholders
WF10927 p7 03.10
Assumed: LUPE shares in issue 313.4 million, SEK:USD 7.1
0.0
3.1
6.2
9.3
12.5
15.6
18.7
21.8
24.9
28.0
31.1
- 250 500 750 1,000 1,250 1,500 1,750 2,000 2,250 2,500
EnQuest Market Capitalisation USD Million
Valu
e of D
istrib
utio
n to
LUPE
shar
ehol
ders
SEK
/sha
re
13
Lundin Petroleum Strategy
WF10932 p4 03.10
Continued organic reserves growth
Production growth from Volund, Luno and Norwegian tie-back opportunities
Exploration leverage Norway, Greater Luno Area, Barents Sea South East Asia Russia USD 290 million budget in 2010 with 11 exploration wells
Continued strong balance sheet and operating cash flow
14
Lundin Petroleum – Post Deal
WF10927 p2 03.10
CMD 2010including UK
2010excluding UK
(1) Includes Q1 2010 expenditure in UK
2P Reserves, MMboe
Contingent Resources, MMboe
Unrisked Prospective Resources, MMboe
2010 Capex Budget, $ million
2010 E&A Budget, $ million
2010 Cost of Operations, $/bbl(10.35 from Q2 2010 onwards)
256
285
1,736
250
290
16.35
177
231
1,656
142 (1)
Net Debt (as at end 2009) 474 474
290
12.50 (1)
15
Lundin Petroleum 2010 Production Forecast
WF10925 p6 02.10
Net boepd
22,000
24,000
26,000
28,000
30,000
32,000
34,000
36,000
38,000
High
Low
Q4Q1 Q2 Q3
incl. UK Q1 2010
High
Low
excl. UK Q1 2010
Norway50%
Tunisia3% UK(1)
7%
Russia13%
Indonesia10%
Netherlands6%
France11%
NorwayVolund onstream 1H 2010
IndonesiaSinga onstream 1H 2010
2010 production guidance 29,000 - 33,000 boepd
(1) First three months only
16
Expected Timetable
WF10932 p5 03.10
4th March Announcement
8th March EGM notice of information circular
22nd March Lundin Petroleum EGM
29th March Decision on secondary offering
Week of 6th April Listing on main board of London Stock Exchange Secondary listing on NASDAQ OMX Stockholm
Week of 6th April Lundin Petroleum shares trade ex-dividend
8th April Record date for Lundin Petroleum distribution of EnQuest shares
17
Conditions
WF10932 p6 03.10
UK government confirmation
Shareholder approval of Lundin Petroleum and Petrofac
Finalisation of third party consents
18
WF10932 p7 03.10
19