Company Presentation. April 2016

Transcription

1 Company Presentation April 2016

2 Cautionary Language Regarding Risks, Forward-Looking Statements and Other Matters This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of These forward-looking statements are based on our current expectations about our company, our properties, our estimates of required capital expenditures and our industry. Words such as "expect, "will," "anticipate," "indicate," "estimate," "believes," "plans" and similar expressions are intended to identify such forward-looking statements. It is important to note that any such forward-looking statements are not guarantees of future performance and involve a number of risks and uncertainties. Actual results could differ materially from those projected in such forward-looking statements. Factors that could cause actual results to differ materially from those projected in such forward-looking statements include: the preliminary nature of well data, including permeability and gas content, and commercial viability of the wells; risk and uncertainties associated with exploration, development and production of oil and gas; drilling and production risks; our lack of operating history; limited and potentially inadequate cash resources; expropriation and other risks associated with foreign operations; anticipated pipeline construction and transportation of gas; matters affecting the oil and gas industry generally; lack of oil and gas field goods and services; environmental risks; changes in laws or regulations affecting our operations, as well as other risks described in our Annual Report on Form 10-K, Quarterly Reports filed on Form 10-Q, and subsequent filings with the Securities and Exchange Commission ( SEC ). Erin Energy undertakes no obligation to publicly update or revise any forward-looking statements. We use certain terms in this presentation such as contingent resources, prospective resources, leads, oil in place and similar terms that the SEC s guidelines strictly prohibit us from including in filings with the SEC. Our Probable (2P) and Possible (3P) reserves may not meet SEC rules and Guidelines (including those relating to pricing) for such reserves. These terms include reserves with substantially less certainty, and no discount or other adjustment is included in the presentation of such reserve numbers. U.S. investors are urged to consider closely the disclosure in our Form 10-K for the year ended December 31, 2014 and in our other filings with the SEC, available on our website at from us at 1330 Post Oak Blvd., Suite 2250, Houston, Texas 77056, Attn: Investor Relations, or by calling us at (713) You may get these documents for free by visiting EDGAR on the SEC web site at or by calling the SEC at SEC

3 Erin Energy Corporation Who we are and what we do Erin Energy Corporation is an independent oil and gas exploration and production company focused on energy resources in sub-saharan Africa Asset portfolio consists of 9 licenses across 4 countries covering ~40,000km2 (10 million acres) Assets include current production and other exploration projects offshore Nigeria, exploration licenses offshore Ghana, Kenya and Gambia, and onshore Kenya World-class assets in 4 African countries Billion barrels of unrisked 2C prospective resources Million barrels of net reserves (2P) Full operatorship of all nine assets with highlyexperienced management team and board of directors Headquartered in Houston, Texas, and listed on the New York (NYSE MKT) and Johannesburg Stock Exchanges (JSE) under the ticker symbol ERN 1.6 Million net barrels of oil produced in st Pioneer offshore E&P company in Nigeria 3

4 Our Company at a Glance We are a global E&P company with a leading Sub-Saharan Africa portfolio that is well positioned to provide exceptional value for shareholders Asset Overview Corporate Offices Operations Production Houston-based independent E&P company listed on NYSE MKT & JSE $430m (1) Market Cap Production & Exploration Projects with Full Operatorship Production (2) ~9,000 bopd Diverse Portfolio with 9 Premium Assets across 4 Countries 16.1 mmbbls 2P Reserves (Net) (1) As at 29-Mar-2016, Bloomberg (2) Steady-state production with Oyo-8 well online in April

5 2015 Overview Erin Energy Corporation achieved many positive results despite the challenging economic climate FY2015 Highlights Operational Summary Tied in Oyo-7 and Oyo-8 wells Net production of approximately 1.6 mmbbls of oil Production averaged 6,400 bbls per day for the year following tie-in of Oyo-8 and Oyo-7 wells in May and mid-june Significant progress made on the technical evaluation of ESWT block in Ghana Acquired 3-D seismic data and extended exploration period on The Gambia blocks A2 and A5 through 2018 Acquired and processed 2-D seismic data and entered into next phase of exploration on onshore Kenya blocks L1B and L16 Financial Summary Full year 2015 revenues were $68.4million Net proved reserves up 32% to 12.0 mmbbls Crude sales of more than 1.4 mmbbls 2016 Capital Development Drill Oyo-9 development well to increase production Drill G prospect to unlock Miocene formation 5

6 Nigeria Country overview Block History & Commitment Block awarded in 1995 to Allied as OPL 210 Converted to OML 120 and 121 in successful wells drilled Sole Risk license under the indigenization program Erin Equity Current Status Producing ~2,000 bopd from Oyo field (~9,000 bopd beginning April 2016) Discovered gas in Ebolibo Additional development wells being planned for Oyo field Prospectivity Prospectivity of Miocene established by Oyo-7 Four world class prospects in the Miocene formation with prospective resources of 2.4 Bbbls oil, recoverable (P50) Blocks surrounded by mega producing fields Erha, Bonga, Sonam 340 million bbls 1.7 billion bbls 253 million bbls Erin Equity 6

7 Nigeria Oyo Field future development opportunities Oyo Phase II Expansion Q Oyo-9 producing well (Oyo Central West Extension) Oyo Central West Main Oyo-1, -4, -5, -7 & -8 Oyo-10 Future Development Opportunities in Oyo Field Oyo-10 (Oyo Central West Main) Oyo-11 (Oyo Central East) Oyo Central West Extension Oyo-9 Oyo Central East Oyo-8 Oyo- 11 Est. Capex ($m) Est. Production (Net mbbls) Oyo m 7,548 Oyo m 2,566 Oyo m 2,136 Wells in Oyo Expansion Phase II Future Wells Contingent Upon Phase II Drilling Results/Favorable Economics 7

8 Oyo Field Expansion Phase 1 Project Performance vs Original Oyo Development Average of 40% cost savings per well for D&C and SURF (i.e excluding FPSO) over initial project cost Average of 50% drilling and completion time savings over initial project performance Average Development Cost (excl FPSO) US$m / Well Average Drilling & Completion Duration Days / Well Wells SURF / Installation Total Initial Development Oyo Expansion Phase 1 Oyo Drilling Completion Total Initial Development Oyo 5-6 Expansion Phase 1 Oyo 7-8 8

9 Drill-Ready Exploration Wells Nigeria OML 120/121 Prolific Western Niger Delta (> 40 Billion Barrels Discovered) Flanked by the Giant Fields Bonga, Erha & Bosi Production Facilities on the Block Prioritized high-value exploration portfolio P50 Prospective Resources of 2.4 Bbbls oil (4 Prospects) G & Ereng Prospects Drill Ready OML 120 & 121 Portfolio of 22 prospects and leads Anticipated Development Summary Daily Production (BOPD) 60,000 40,000 G Downthrown G Upthrown 20, Daily Production (BOPD) 300,000 Ereng 200, , Est. Production (Net mmbbls) Est. Revenue at $50/bbl ($m) Erin Equity Prospect G mmbbls 7,920m Ereng 1,635.4 mmbbls 81,770m Source: * DeGolyer and MacNaughton. ** Gaffney, Cline & Associates. Prospec@ve resources & produc@on values are unrisked 9

10 Ghana Country overview Block History & Commitment JOA signed Jan Block with 3 discovered fields Initial work commitment Declare commerciality within 9 months Reprocess existing 3D seismic data Drill one well within 2 years Current Status Completed the resource volume assessment on ESWT block In place oil and gas volumes assessed at approx. 500mmbbls and 282 BCF 14 wells drilled in the field Potential for commercial development Seeking a review of the fiscal terms Seeking clarification on the boundary dispute Drilling of one well within 2 years may be impacted Prospects are arranged in corridor between West Tano and South Tano near field opportunities Prospectivity Near term development opportunity Identified four high quality prospects within the vicinity of discovered fields 3D acquisition being planned to better define prospectivity 10

11 Gambia Country overview Block History & Commitment Blocks A2 & A5 awarded in 2012 for 4 years (Dec. 2016) Initial work commitment per block Regional geological survey Acquire, process, interpret 750 sq. km of 3D seismic data Drill one exploration well Modification to PSC (2015) Expiry extended to Dec 2018 Drill one exploration well in either block From: Cairn Energy 2016 Current Status Completed 3D Seismic acquisition Currently processing more than 1,600 km2 3D seismic data Actively seeking farm-in partners Prospectivity On trend with proven petroleum system confirmed in recent discoveries offshore Senegal The SNE-3 well located ~10 km from A2 Subsequent appraisal with SNE-2 well resulted in upwardly revised P50 (2C) resources to 385 mmbbls (Cairn Energy) Seven leads in Shelf Edge Fairway 3000 m Cairn Block 2000 m 20 km FAN m Shelf Edge Albian 1000 m 500 m 1000 m SNE m 500 m Sands Platform Fairway Reef 100 m Erin Energy Jammah 1 Trend A2 A5 Fan Discovery SNE Discovery Erin Energy Prospective Trend 11

12 Kenya Country overview Block History & Commitment 4 blocks awarded in 2012 Initial work commitment for L1B and L16 (2 years) Acquisition & interpretation of gravity & magnetic data Acquire, process and interpret 500km of 2D data Initial work commitment for L27 and L28 (3 years) Regional geological and geophysical studies Reprocessing & re-interpreting previous 2D seismic data Acquiring, processing and interpret 1,500 square kilometres of 3D seismic data L1B Hagarso Current Status 18 months extension granted for L27 & L28 (February 2017) Completed 1800km 2D seismic acquired & processed 3D acquisition in L27 & L28 subject to completing farm-out Moved into first extension period for L1B and L16 (June 2017) Completed Gravity & Magnetics plus 1025km 2D seismic data acquired & processed 300km 2 3D seismic and drill one well Planning 3D acquisition in L16 and L1B in 2017 Prospectivity Numerous high potential leads have been identified using the recently acquired 2D seismic data & gravity & magnetics data Proven petroleum system with numerous hydrocarbon shows from offsetting wells Pomboo Kofia Kubwa Maridad i L16 Mbawa Simba Kiboko Sunbird Bouguer Gravity 12

13 Technical Capability Top-Class technical and operational capacity Experienced Staff Pool Majority of senior staff are from Major IOCs with great networks International experience spanning all continents Top 10 technical staff have more than 300 years of industry experience Staff have full industry life-cycle experience Location Advantage Company is headquartered in Houston Easy access to capable manpower and technology Operational Track Record Proved efficiency in drilling and completion when compared to previous operator Ongoing reservoir management and production optimization Ongoing cost reductions through supplier negotiations Planned drilling of development and exploration wells in 2016 Cost Advantage Erin is low cost operator compared to previous IOC 13

14 Investment Highlights Our value creation model Production and Revenue Growth Long-Term Frontier Exploration Reserves and Resources Growth Sub-Saharan Africa Assets Near-Term High Impact Exploration Opportunistic Acquisitions We are a pioneering Exploration & Production company uniquely positioned to deliver success Generating predictable, repeatable oil production growth Favourable fiscal regimes with a low fixed-cost base Industry leading drilling success Advancing world-class frontier exploration in Africa Near-term high-impact exploration offshore Nigeria Continuing to obtain attractive exploration assets 14

15 Our Board Distinguished Board of Directors John Hofmeister Chairman (1) Former President, Royal Dutch Shell Lee Brown Independent Director Former Mayor, City of Houston Director, Office of National Drug Control Policy, President Clinton Cabinet Hazel O Leary Independent Director Secretary of Energy, President Clinton Cabinet Assistant Secretary of Energy, President Carter Federal Energy Administration, President Ford Dudu Hlatshwayo Independent Director Director, Public Investment Corporation Chairman, Change EQ (PTY) Ltd. Former Partner, Ernst & Young Wayne McConnell Independent Director Managing Partner, McConnell & Jones LLP Bill Campbell Independent Director Managing Director, CB Energy, LLC (1) Pending shareholder vote in May

16 Our Team Experienced and diverse international management team Kase Lawal Segun Omidele Daniel Ogbonna Jean-Michel Malek Heidi Wong Chairman and Chief Executive Officer Chief Operating Officer SVP, Chief Financial Officer SVP, General Counsel and Secretary SVP & Chief Administrative Officer CAMAC International Limited Brands Deloitte Consulting JP Morgan Securities CAMAC International Pacific Asia Petroleum ChevronTexaco Founder Allied Energy Plc Royal Dutch Shell Carl Scharpf Ojay Uzoh Olu Marinho VP, Exploration & Geoscience VP, Technical VP, Projects Shell International Shell Oil US Eni E&P S.p.A. Royal Dutch Shell Apache Corp Murphy Oil Marathon Oil Burlington Resources 16

17 Our Team Management team biographies Kase Lawal is Chairman and Chief Executive Officer and is the founder of Erin Energy Corporation. Dr. Lawal is committed to public service, and contributes valuable leadership as a board member of the National Urban League, and the Cullen Engineering Research Foundation. In addition, he is a member of the Board of directors and a shareholder of Unity National Bank in Texas. Dr. Lawal earned a bachelor's degree in chemistry from Texas Southern University and an MBA in finance and marketing from Prairie View A&M University. He was awarded an honorary doctorate in philosophy from Fort Valley State University, and an honorary doctorate in humane letters from Texas Southern University. Segun Omidele is Chief Operating Officer and joined the company in Prior to being promoted to COO, he served as Senior Vice President, Exploration & Production. Prior to joining Erin Energy, he was Senior Vice President, Exploration and Production for Allied Energy Corporation since October Prior to joining Allied Energy Corporation, Mr. Omidele worked for 28 years with Shell companies in Nigeria, UK and the USA where he held several technical and management positions. He left the services of Shell E&P, Africa as Resource Volume Manager for Africa in September Mr. Omidele holds a Bachelor's degree in Petroleum Engineering from the University of Ibadan, Nigeria and a Masters in Petroleum Engineering from the University of Houston. He is also a graduate of the Advanced Management Program of Harvard Business School, and is a member of the Society of Petroleum Engineers and the Nigerian Society of Engineers. Daniel Ogbonna is Senior Vice President and Chief Financial Officer and joined Erin in September Prior to Erin, he served as Executive Vice President and Chief Strategy Officer of CAMAC International Corporation since 2010 and led the business development and M&A activities. He was also responsible for strategic planning, financial forecasting, acquisition analysis, and securing project funding. Mr. Ogbonna has extensive experience working with financial institutions and brings an acute understanding of Erin Energy s business, the countries in which the Company operates, and the business climate in Africa. Prior to CAMAC, he held roles at Limited Brands, Deloitte Consulting, and JP Morgan Securities. Mr. Ogbonna holds an MBA from Harvard Business School and a MS in Mechanical Engineering from the University of Michigan. Jean-Michel Malek is Senior Vice President, General Counsel and Secretary and joined Erin in November Mr. Malek was previously with CAMAC International Corporation, where he served as Executive Vice President and General Counsel and was responsible for all aspects of CAMAC s legal affairs around the world. Prior to then, Mr. Malek was engaged in private practice with law firms in Houston and also held various positions as in-house counsel with multinational companies. He has also been an Adjunct Professor at the University of Houston Law Center. Mr. Malek holds a J.D. from the University of Texas School of Law and has a bachelor s degree in philosophy from the University of Texas at Austin. From 2007 until 2012, he served as Honorary Consul of Namibia for the State of Texas. Heidi Wong is Senior Vice President and Chief Administrative Officer and joined the Company in She has served in various roles, including Vice President of Business Planning and Strategy, and Managing Director of the Company s China operations. As Vice President of China operations, she managed all aspects of in-country business development and government relations. Ms. Wong worked for more than two decades in business development, government liaison and commercial affairs with both Texaco and Chevron, including as Director of Marketing and Government Affairs for Texaco China, General Representative for Texaco in Beijing prior to the Texaco-Chevron merger, and Vice President of Business Development and External Affairs for ChevronTexaco China Energy Co. following the merger. Ms. Wong holds an MBA degree from Wuhan University in China. 17

18 Our Team Management team biographies Carl Scharpf is Vice President Exploration and Geoscience with 26 years of experience in the oil and gas industry. He has a proven track record of exploration success around the world. Mr. Scharpf has significant experience in China, Indonesia, Trinidad, Australia, Egypt, Russia, Vietnam, the Gulf of Mexico as well as other parts of the world. Recently, Mr. Scharpf was the Offshore Gulf of Mexico Exploration Manager for Apache Corporation in Houston, USA. He held a similar position at Murphy Oil that was preceded by a role as Indonesia Exploration Manager for Marathon Oil in Jakarta Indonesia. Additionally, he held Management of Technical positions at Burlington Resources, Union Texas Petroleum, and Amoco. Mr. Scharpf holds a Bachelor of Science Degree in Geology from Rider University and a Master of Science Degree in Geology from the University of Cincinnati. He has taken Advanced Management Classes at the Southern Methodist University. He is a Professional Geologist in the State of Texas and a member of the American Association of Petroleum Geologists. Ojay Uzoh is Vice President Technical with over 29 years engineering experience spanning five continents, most of which are in upstream oil and gas. Prior to joining Erin Energy, Mr. Uzoh spent 20 years at Shell International E&P and Shell Oil US in various production roles, the last of which was Subsurface Manager for a major deepwater project. Before joining Erin Energy in 2016, Mr. Uzoh worked as a technical consultant to upstream oil and gas companies on deepwater business development, tight and shale gas development workflows and technologies. Mr. Uzoh was also a technical advisor to a major Los Angeles based Hedge fund facilitating oil and gas deals in Russia, Malaysia, Colombia, Israel, Canada, etc. Mr. Uzoh has a Masters degree in Petroleum engineering from University of Houston, and is a registered engineer of the province of Alberta Canada. Mr. Uzoh is also a member of the Society of Petroleum Engineers. Olu Marinho is Vice President Projects with over 20 years of experience in the upstream oil and gas sector. Before joining Erin Energy, he held senior project management positions in Eni E&P S.p.A and the Royal Dutch Shell Group. Mr. Marinho has hands on experience in the planning and execution of multi-billion dollar projects for deepwater applications in Nigeria, Angola and the Republic of Congo. He has a BS degree in Civil Engineering from Case Western Reserve University and an MS in Structural Engineering from Stanford University. He holds a Professional Project Manager (PMP) certification from the Project Management Institute (PMI). 18

19 Contact us For more information: NYSE MKT: ERN I JSE: ERN Main Investor Relations US SA Media Erin Energy Corporation Corporate Headquarters South Africa Office 1330 Post Oak Blvd., Suite 2250 Katherine & West Houston, Texas West Street, Unit 10 Sandton, 2196, Johannesburg 19