trinidad indonesia - range resources · up development plan in indonesia. 2017 highlights 5...

TRINIDAD INDONESIA

Corporate PresentationDecember 2017

Disclaimer

Corporate Presentation2

This presentation has been prepared by Range Resources Limited (“Range”or the "Company").

This presentation is for information purposes only and does not constitute orform part of an offer, solicitation or invitation of any offer, to buy or subscribefor any securities, nor should it or any part of it form the basis of, or be reliedin any connection with, any contract or commitment whatsoever.

The information contained in this presentation has not been independentlyverified. No representation or warranty expressed or implied is made as to,and no reliance should be placed on, the fairness, accuracy, completeness orcorrectness of the information or opinions contained in this presentation.Neither the Company nor any of its respective officers, employees, affiliates,advisers or representatives accept any liability whatsoever (in negligence orotherwise) for any loss howsoever arising, whether directly or indirectly, fromany use, reliance or distribution of this presentation or its contents orotherwise arising in connection with this presentation.

This presentation includes forward-looking statements. These statementscontain the words "anticipate", "believe", "intend", "estimate", "expect“, “plan”and words of similar meaning. All statements other than statements ofhistorical facts included in this presentation, including, without limitation, thoseregarding the Company’s financial position, business strategy, plans andobjectives of management for future operations (including development plansand objectives relating to the Company's business and services) are forward-looking statements. Such forward-looking statements involve known andunknown risks, uncertainties and other important factors that could cause theactual results, performance or achievements of the Company to be materiallydifferent from results, performance or achievements expressed or implied bysuch forward-looking statements. These forward-looking statements speakonly as at the date of this presentation. Predictions, projections or forecasts ofthe economy or economic trends of the markets are not necessarily indicativeof the future or likely performance of the Company. Past performance is notnecessarily indicative of future performance. The forecast financialperformance of the Company is not guaranteed. You are cautioned not toplace undue reliance on these forward-looking statements, which are basedon the current views of the Company on future events. The Companyexpressly disclaims any obligation or undertaking to disseminate any updates

or revisions, except as required by law, to any forward-looking statementscontained herein to reflect any change in the Company's expectations withregard thereto or any change in events, conditions or circumstances on whichany such statement is based.

Resources estimates provided in presentation have been extracted from thecompetent persons reports prepared in respect of the Company's Trinidadianand Indonesian assets and which are available on the Company's websiteand conform to the ASX Listing Rules and AIM Rules for Companies.

The Company is not aware of any new information or data that materiallyaffects the assumptions and technical parameters underpinning the estimatesof resources.

The estimated quantities of petroleum that may potentially be recovered bythe application of future development projects relate to undiscoveredaccumulations. These estimates have both an associated risk of discoveryand a risk of development. Further exploration appraisal and evaluation isrequired to determine the existence of a significant quantity of potentiallymoveable hydrocarbons.

Neither this presentation nor any copy or portion of it may be sent or taken,transmitted or distributed, directly or indirectly, into the United States, Japan,Canada or any other jurisdiction which prohibits the same. The securities ofthe Company have not been, and will not be, registered under the U.S.Securities Act of 1933, as amended (the "Securities Act"), or the securitieslaws of any state or other jurisdiction of the United States or elsewhere, andthe securities may not be offered or sold within the United States exceptpursuant to an exemption from, or in a transaction not subject to, theregistration requirements of the Securities Act and applicable state or localsecurities laws. This presentation is not for distribution in, nor does itconstitute an offer for sale of securities in the United States. The Companydoes not intend to conduct a public offering of its securities in the UnitedStates.

Exciting investment opportunity –an oil and gas company with production, revenues, reserves


TRINIDAD

✓ EXISTING OIL PRODUCTION – 580 bopd (quarter ended 30 Sep 2017)

✓ SUBSTANTIAL RESERVES – 16 million barrels (net 2P)

✓ FOCUSED ON PRODUCTION GROWTH

✓OWN RIGS AND EQUIPMENT – lower operating costs and operational flexibility

INDONESIA

✓ LOW CAPITAL COMMITMENT

✓ NEAR TERM PRODUCTION – from low-cost workover programme

✓ HIGH QUALITY ASSET – previous production with significant upside potential

CORPORATE

✓ ADOPTING AN INTEGRATED MODEL – upstream plus oil services

✓ SIGNIFICANT GROWTH – from existing assets and new opportunities

✓ STABLE FINANCIAL POSITION – existing cash with medium-term debt maturity

✓ ENHANCED LIQUIDITY – AIM and ASX-listed

Executing growth strategy


Expand waterflood,

grow production and

revenues in Trinidad

Secure third party

contracts and

grow revenues of

Oilfield Services

(RRDSL)

Continue to evaluate

new asset

acquisitions

Complete workovers,

commence

production and firm

up development plan

in Indonesia

2017 highlights


✓ Two significant assets acquired

✓ Successful waterflood programme implemented

showing production increase (~35% of total

production is now from waterflood)

✓ 2 new wells drilled, 233 workovers completed

✓ Continued HSE performance above industry

standards

✓ Initial work programme in Indonesia underway

✓ CPRs on two assets completed (Trinidad and

Indonesia)

✓ AIM re-admission completed

Trinidad operations –production, reserves, revenue, opportunity

• Majority interest and operatorship across all

blocks

• Production of 580 bopd (quarter ending 30

Sep 2017)

• Reserves of 16 million barrels (CPR, 2017)

• Over 100 wells have been drilled by Range in

the last 5 years

• 180 wells are currently producing from zones

ranging in depth from 400 to 4,000 feet

• Active work programme to increase

production: waterflood, selective drilling, and

workovers

• Focus on most prospective acreage


Field Range’s

interest

Status Licence

expiry

Licence

area (km2)

Beach

Marcelle

100% Development 31/01/2020 16

Morne

Diablo

100% Development 31/12/2021 35

South

Quarry

100% Development 31/12/2021 14

St Mary’s 80% Exploration 31/10/2020 153

Trinidad reserves and resources summary –solid and independently verified


1P 2P 3P

Reserves (net to Range)

MMstb10.0 16.0 22.9

1C 2C 3C

Contingent Resources

(net to Range)

MMstb

4.6 8.0 15.4

1. Independently certified by Rockflow Resources Ltd

(June, 2017)

2. Includes reserves and resources for Morne Diablo,

South Quarry and Beach Marcelle fields

3. Excludes highly prospective exploration acreage

• Recently completed CPR confirms large

certified oil reserves base

• 70% of reserves are in waterflood projects

Waterflood is key –to growing production


Beach Marcelle waterflood

• Range’s largest waterflood project

• The field is closely connected to well developed

infrastructure

• It has been split into a number of individual

“areas”, based on fault blocks

• South East area successfully implemented

• Work completed to increase water injection

rates (by additional 700 bwpd)

Planned expansion

• During late 2018 / 2019, waterflood programme

expected to expand to further areas:

➢ South Quarry

➢ South West (Beach Marcelle)

➢ North East (Beach Marcelle)

Beach Marcelle waterflood areas

South East area –current surface infrastructure


Source: Google maps

New acquisitions –completed during the year


1.

Indonesia

Perlak Field

2.

Trinidad

Oilfield Services

1. Perlak field –a highly attractive acquisition

• Low acquisition cost

• Low level of commitment during MWO period

• A proven play surrounded by producing fields

and infrastructure

• High prior drilling density (over 300 wells

drilled)

• Only produced by primary depletion (c. 50

mmbbls to date)

• Very light oil with average API of 45-50

degrees

• Very limited recent activity

• Significant potential for rapid return to

production through planned workovers

• 15 year contract with Pertamina (Indonesian

state-owned oil and gas corporation)


Perlak field –a proven play surrounded by producing fields and infrastructure


Perlak –low commitment obligation


Net cost to

Range (US$ m)ActivityCompletion

date

Geological, geophysical and reservoir studies

Well surveying

1 well workover

3D seismic data evaluation

3 well workovers

Geological, geophysical and reservoir studies

1 well drilling

1

Year

2

3 Sep 2020

0.3

0.7

1.4

TOTAL 2.3

Sep 2019

Sep 2018

Perlak field –activity already underway

• Building the operational team – key

appointments underway

• Budget and work programme being

agreed with Pertamina for 2018

• Offices being established in Jakarta

and at the field in Aceh

• Detailed scope being prepared for

G&G studies, and surface checking at

field

• Reviewing potential reopening of wells

for the 2018 work programme

• Work underway to establish a service

company in Indonesia (subsidiary of

Range)


Perlak field opening ceremony

28 November 2017

Indonesia contingent resources summary –independently verified


1C 2C 3C

Net to Range

(based on 23% interest)

Associated Gas (Bscf) 1.7 10.9 41.1

Oil (MMstb) 0.9 3.1 18.4

Net to Range

(based on 42% interest)

Associated Gas (Bscf) 3.2 20.0 75.0

Oil (MMstb) 1.6 5.6 33.6

1. Independently certified by LEAP Energy Partners Sdn (August, 2017)

2. Range’s interest will increase from 23% to 42% once the minimum

work programme is completed at the end of the 3-year period

2. Trinidad oilfield services business (RRDSL)


Why is it attractive for Range?

• One of the most modern rig fleets in the Caribbean capable of supporting a wide variety of oilfield operations

• Acquisition significantly lowers Range’s operating and drilling costs, provides improved netback per barrel and a greater operational flexibility

• Provides an additional income stream from work undertaken for third parties

• Plans to grow the drilling business into a leading oilfield services provider in the Caribbean and LatAm

Recent third party clients

2017 / 2018 –active work programme and newsflow across all assets


• Trinidad development well results

• Trinidad waterflood programme progress update

• Indonesia commencement of work programme

• RRDSL activity update

• Trinidad development drilling

• Potential acquisitions of new assets

Commitment to engaging with all shareholders:

• Investor Q & A sessions

• Webcasts

• Presentation forums

• Regular operational and corporate updates

Summary –exciting period of results and growth


✓ Established assets with existing reserves and

production

✓ Integrated model – upstream and oil services

✓ Active work programme aimed at production

uplift

✓ Ramp up in activity from three assets to

provide regular newsflow

✓ Following a period of active investment,

Range is well positioned to grow production,

revenues and cashflows

Contact details:

+44 20 3865 8430

[email protected]

www.rangeresources.co.uk

Management team –strong, experienced and focused


Nick BeattieCFO and Company Secretary

• Over 20 years of experience

in finance working with a

range of international banks

• Previously, Managing

Director with BNP Paribas in

the Upstream Oil & Gas

team in London

• Associate Member of the

Association of Corporate

Treasurers and Fellow of the

Chartered Institute of

Bankers

Lijun XiuVice President of Operations

and Production

• Geological career of over 30

years

• Previously worked for the

Research Institute of

Petroleum Exploration &

Development as Deputy

Chief Geologist

• Holds a number of

professional titles, including

Reserves Evaluation

Specialist from the Ministry

of Land and Resources of

China

Yan LiuCEO and Executive Director

• Over 20 years of accounting

and corporate advisory

experience in China and

Australia

• Previously, the Chief

Financial Officer with China

Rerun Chemical Group

Limited, a China-based

lubricant oil company

• Bachelor degree in

Economics and a Master

degree in Commerce

Dr Douglas FieldChief Petroleum Engineer

• Petroleum and reservoir

engineer with over 30 years

international exploration and

production experience

• Previously held senior

engineering and business

development posts at Tullow

Oil plc

• PhD in Organic Chemistry

from the University of Leeds

Management Team –strong, experienced and focused


Theo EleftheriadesGroup Financial Controller

• Chartered Accountant with

over 6 years' experience,

predominantly in the oil and

gas sector

• Previously, was an Entity

Controller at Gazprom. Prior

to that, was a Group

Financial Accountant at

Seadrill, a leading listed

offshore drilling contractor

Karlene AliRange Trinidad Deputy

General Manager

• Over 10 years of oil industry

experience, having held

various finance, HSE and

administrative positions with

independent oil and gas

companies in Trinidad

• Responsible for

communications,

government and stakeholder

relations, corporate social

responsibility and contract

compliance

Evgenia BezruchkoCorporate Development

Manager

• Extensive experience in

corporate development and

capital markets in natural

resources sector

• Prior to joining Range in

2012, worked in corporate

broking and equity sales for

an independent merchant

bank, covering a wide range

of listed and private oil & gas

and mining companies

Board of Directors –aligned with shareholders’ interests


Lubing LiuNon-Executive Director

• Over 20 years extensive

global experience in

petroleum exploration,

development, production,

joint venture operations and

new ventures

• Currently an independent

consultant to Melbana

Energy Limited, an ASX

listed E&P company

• Prior to that, held various

subsurface leader roles,

including Sinopec

Zhiwei (Kerry) GuNon-Executive Chairman

• Experienced corporate

lawyer, currently a partner of

Dentons, one of the largest

global law firms

• Worked with numerous

companies on various stock

markets including Chinese A

share, NASDAQ, TSX and

HKSE

• Participated in several

Venture Capital and Private

Equity investment cases

with large international funds

Yan LiuCEO and Executive Director

• Over 20 years of accounting

and corporate advisory

experience in China and

Australia

• Previously, the Chief

Financial Officer with China

Rerun Chemical Group

Limited, a China-based

lubricant oil company

• Bachelor degree in

Economics and a Master

degree in Commerce

Board of Directors –aligned with shareholders’ interests


Juan WangNon-Executive Director

• Commercial banking

background, having worked

for Deutsche Bank and Bank

of East Asia

• Previously, President of

Energy Prospecting

Technology USA, Inc. and

LandOcean Energy Canada

Ltd

• Prior to that, an investment

manager and director at

Anterra Energy Inc.

responsible for Chinese

investor liaisons

Dr Yi ZengNon‐Executive Director

• Over 30 years of experience

in the oil and gas and mining

industries

• Held various technical and

research positions with

global companies, including

BHP Billiton and Santos

Asia Pacific

• PhD in Geophysics from the

Victoria University, New

Zealand

Corporate snapshot


Share Price AU$0.004 (as at 12 December 2017)

Market exchange AIM and ASX

Ticker AIM: RRL, ASX: RRS

Market Capitalisation A$30 m (as at 12 December 2017)

Ordinary Shares in Issue 7,600 m

Options in Issue c. 800 m

Cash US$17 m (as at 30 Sep 17)

Year End 30 June

Stable liquidity position –existing cash with medium-term debt and payable maturity profile


• Range has cash on hand of approximately US$17 million (as at 30 September 2017 quarterly report)

• The payable and debt position has grown over the last few years principally as a result of investment into the Trinidad assets to establish long-term growth

• Competitive cost of finance at 6% (8% for convertible bond)

• No maturities until late 2019 (majority in 2020)

• No financial covenants or restrictive undertakings

• Range focused on growing production and cashflow and will also start review of maturing payable profile during 2018

• Various means open to Range for refinancing

Component Amount (US$ m)

RRDSL Loans

Remaining debt in RRDSL which is

principally due to newly acquired rigs.

Asset backed by rigs

21.4

RRDSL Acquisition Payment

Not due until end November 2020

allowing time to grow RRDSL into a

profitable business

5.5

Trinidad investment spend

The sums incurred during the past 2-3

years covering Trinidad operations,

drilling, waterflood investment etc.

Repayable in April 2020 allowing time to

grow production levels

40.2

Convertible Bond

Convertible at £0.008/share. Repayable

in November 2019

20.0


Private individuals

Beijing Sibo Investment Management LP

Abraham Ltd

Capital structure –balanced mix of shareholders

• Balanced mix of institutional, high net worth and private shareholders

• Private individuals (59% shareholding) –over 20,000 international high net worth individuals and smaller private investors

• Beijing Sibo Investment Management LP (32% shareholding) – an investment fund headquartered in Beijing, China, comprised of institutional and high net worth individual investors

• Abraham Ltd (9% shareholding) – a Hong-Kong based private investor

• Board Independence – the majority of the Board are independent with no link to largest shareholders

59%32%

9%


Trinidad –a world class oil and gas province

• Leading oil & gas producer in the Caribbean

(net exporter of oil and gas)

• Prolific hydrocarbon basin that forms part of

Eastern Venezuelan basin

• 11 km from the Venezuelan coast

• Long history of commercial oil production

since 1910

• Total production to date over 3 billion barrels

of oil

• Proven reserves of 0.7 billion barrels of oil

• Oil & gas accounts for 40% of GDP and

80% of exports

• 168,000 bopd refinery (throughput c.

113,000 bopd)

• Well established extensive infrastructure

and facilities

• Majors currently operating in Trinidad: Shell,

BP, BHP, Perenco, EOG, Chevron


Indonesia –significant player in the international oil and gas industry

• Indonesia, an OPEC-member country, has been active in the oil and gas sector for over 130 years after its first oil discovery in North Sumatra in 1885

• Top 20 of the world’s oil producers, 2016 oil production: 831,000 bopd

• Proven oil reserves: 3.7 billion barrels

• About 75% of exploration and production is located in Western Indonesia

• Before the fall in oil prices in 2013, the sector generated US$28 billion a year in foreign income, provided 20% of the government’s revenues, and supported 280,000 jobs

• Declining oil production and increased consumption has resulted in Indonesia being a net oil importer

• The Government is introducing incentives to encourage investment:

– New improved production sharing splits in recent bid rounds with after-tax returns for oil increasing from 15% to 25% and for gas from 30%-35% to 40%

– In early 2017, the Government introduced the Gross Split PSC

Waterflood –expanding on the proven concept

70% of Range’s reserves are in waterflood

• Trinidad onshore oilfields are mature, with

some having produced for over 100 years

• Most of the fields have been traditionally

produced by “primary recovery” – only

recovers about 18% of the oil-in-place

• Waterflooding is estimated to increase the

total recovery factor to approximately 30%

Common and proven secondary recovery practice

• Texaco used waterflooding successfully in

parts of the Beach Marcelle field in

the1950s/60s

• Pilot project competed by Range and

successfully producing since 2010

• Two further waterflood projects successfully

competed by Range and are in production

• Approximately 35% of Range’s current

production is from waterflood


Glossary


1P Proven reserves with 90% probability of being recovered

2P Proven plus probable reserves with 50% probability of being recovered

3P Proven plus probable plus possible reserves with 10% probability of being recovered

1C A low estimate category of Contingent Resources

2C A best estimate category of Contingent Resources

3C A high estimate category of Contingent Resources

bscf Billions of standard cubic feet of gas

bopd Barrels of oil per day

bwpd Barrels of water per day

CPR Competent Persons Report

MMstb Million stock-tank barrels of oil

trinidad indonesia - range resources · up development plan in indonesia. 2017 highlights 5...

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