Investor Presentation November 2015 1
Disclaimer This presentation may contain forward-looking statements. Forward-looking statements refer to events and conditions which are not historical facts and include, for example, statement concerning our objectives, goals, strategies, future events, future performance, capital expenditures, financing needs and business trends. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of our control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. You should not placeundue reliance on these forwardlooking statements. Any forward-looking statements are based upon information available to us on the date of this presentation. Actual results may differ materially from those anticipated in these statements. This presentation does not constitute or form part of any advertisement of securities, any offer or invitation to sell or issue or any solicitation of any offer to purchase or subscribe for, any shares in Solo Oil plc, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with, any contract or investment decision. Slide 1
Who we are Solo Oil plc Oil & Gas Investment Company specifically focused on acquiring and developing a diverse global non-operated portfolio of assets Listed on the London AIM Market (SOLO) Market Capitalisation: approximately 25 m Portfolio Tanzania : Major stake in the prolific Ruvuma Basin and the ready to flow Kiliwani North gas Development on Songo Songo Island West Africa : Strategic investment in Burj Africa with applications for field development projects in Nigeria UK: Interests in Weald Basin including Horse Hill and licence application of the Isle of Wight Canada: Enhanced Oil Recovery project in Ontario currently shut in due to operator issues Slide 2
How we work Solo Oil is a AIM-listed strategic investment company with a diversified portfolio of in-production, near production and high impact exploration projects designed to add value for our shareholders over time INVEST In oil & gas assets as a Non operator SELECT Undervalued assets across a range of geographic locations FOCUS On unrealised exploitation and exploration potential LEVERAGE The skills and knowledge of existing project operators CAPITAL To gain access and add value across the project portfolio MONITOR Progress of projects without duplicating the operators work 4 Slide 3
Management An experienced team with a strong track record of oil and gas delivery Neil Ritson Fergus Jenkins Donald Strang Sandy Barblett CHAIRMAN EXECUTIVE DIRECTOR FINANCE DIRECTOR NON- EXEC DIRECTOR Has a BSc in Geophysics and has worked in the energy sector for 38 years, initially with BP plc for 23 years, before managing the international operations of Burlington Resources Inc. More recently, he was CEO at Regal Petroleum plc, before founding Vanguard Energy Group, where he was Chairman and CEO. As Founder and Chairman of VE Resources Limited he oversaw the rapid growth of a company in the oil services sector. Currently CEO of LGO-Energy plc and Non- Executive Director of Enovation Resources Limited. Is a Chartered Engineer with a BEng (Hons) degree in Mining Engineering and a MEng in Petroleum Engineering. He has over 20 years of experience working in industry, initially in mining before moving to petroleum. Worked in a variety of technical and increasingly senior managerial positions in mid-sized independent oil companies, including Enterprise Oil, LASMO, OMV (UK) Ltd and Afren plc. Currently COO of LGO-Energy plc. A member of the Australian Institute of Chartered Accountants, holding senior financial and management positions in both publicly listed and private enterprises in Australia, Europe and Africa. Considerable corporate and international expertise in the oil and gas and natural resources sectors. He is currently a Director of a number of AIM listed companies including Rare Earth Minerals Plc, Doriemus Plc, UK Oil & Gas Investments Plc and Polemos Plc. Has a bachelor of business from Curtin University of Technology (Perth) and a bachelor of laws from the University of Queensland. Over 15 years senior management experience working with private and publicly listed companies. Formerly a partner in Ironbridge Capital Partners, Mr. Barblett has also worked with Pace plc, the leading developer for the global pay TV industry. Has advised a number of companies on raising private equity and general fund raising, corporate strategy andm&a. 5 Slide 4
Tanzania: Ruvuma & Kiliwani North
Tanzanian Opportunity The projected potential natural gas demand for sub-saharan Africa is 6.5 TCF in 2030, 11.4 TCF in 2040 and 19.2 TCF in 2050 Source: Sustainable Engineering Lab et al (2014). Tanzania boasts proven natural gas reserves of over 55 TCF which are the biggest in East Africa after Mozambique Supportive & proactive new government with plans & measures to accelerate development in the nation s gas industry A new gas pipeline was completed with capacity of over 800 mmscf per day Tanzania looks towards becoming a significant LNG exporterby2020. Major players are highly active in the offshore gas province: 7 Slide 6
Ruvuma Basin PSA Encouraging results from licences strategically located in a proven gas basin Operated by Solo Oil interest: 25% (reducing to 12.5% in planned farmout) Operator: Aminex plc (Nduvo Resources) 75% (reducing to 37.5% in planned farmout) New partner: Bowleven plc (50% on completion of planned farmout) Status: Exploration & Appraisal LOCATION: 6,079-square km (Lindi and Mtwara licences) in southeast Tanzania, 80% onshore, 20% offshore RESOURCE POTENTIAL: Estimated 4.17 tcf of gas in place; Ntorya-1 discovery 153 BCF (CPR by Senergy Limited, 2015) EXPLORATION POTENTIAL: 4 large-scale gas prospects, 4 additional prospect leads, plus offshore prospects with multi-tcf resource potential. Condensate (light oil) discoverysuggests potential for future oil discovery INCREASED PARTICIPATION: Solo increased its interest from 12.5% to 25% (now farming down to 12.5% for a two well carry and bonus payments) INFRASTRUCTURE: Mtwara Port located 25 km from Ntorya-1 discovery. Chinese funded gas processing plants & new 36 gas pipeline running from Mtwara to Dar es Salaam. 8 Slide 7
Exploration History The Solo-Aminex joint venture in the Ruvuma PSA is investing to increase known reserves at key locations across its 6,079-square km licence area HISTORIC 1153 km of 2D seismic conducted, 1981-2002 Nowells drilledinthe PSA, but wells drilled tothe north (Texaco, 1992) and southeast (Agip, 1982) Aminex/Ndovu Resources acquired 370 km of offshore seismic (Lindi Block) and 430 km of 2D seismic onshore (Lindi andmtwara blocks), 2014 RUVUMA PSA Drilling commenced in 2010 (Likonde-1 well) First well (3,647 metres) had excellent shows for residual oil and gas Second well, Ntorya-1, made a gas discovery of potential commercialinterest. Light oil and condensates are alsopresent. Further 2D seismic completed in 2014 Two additional wells are planned to follow up on the success of Likonde-1 and Ntorya-1 The joint venture has until late 2016 to drill two further wells in the Lindi and Mtwara licence areas 9 Slide 9
Successful flow test Confirmation that the Ntorya area is highly prospective for commercial oil & gas production DISCOVERY: Ntorya-1 found gross 25 metres MidCretaceous sandstones Total net sands 20 metres, clean with up to 20% porosity at 2,663 metres. Uppermost 3.5 metres were tested GAS FLOW: 20.1 mmscfd through a standard 1-inch choke; formation pressure of 5,424 psi LIQUIDS PRODUCTION: 139 bopd of condensate at 20 mmscfd Test analysis is now complete and supports the view that Ntorya-1 is economic Further seismic was shot in 2014 and an appraisal well programme is planned for early 2016 Investor Presentation Q4 2015 Slide 10
Ruvuma Farmout Announcement of a joint farm-out with Aminex and Bowleven JOINT WORK: Aminex and Solo signed a Vendor Collaboration Agreement in October 2012 to jointly market their Ruvuma interests to interested parties FARMOUT: Agreement reached in November 2015 to farmout a pro rata 50% share to Bowleven plc for a $10 million work programme carry and various production bonus payments. Aminex remain operator CONSIDERATION: Solo will reduce its interest from 25% to 12.5% for a $2.5 million work programme carry and $1.125 million in stage payments DRILLING: Expect to drill 2 appraisal wells on the Ntorya gas-condensate discovery in early 2016 DEVELOPMENT: Additional payments as the Ntorya field comes on production Investor Presentation Q4 2015 Slide 10
Access to markets Ntorya-1 and the wider Ruvuma PSA benefit from excellent access to the market through the regional gas pipeline connecting Dar es Salaam to Mnazi Bay Ø $1.33 billion project: largely financed by Chinese loans Ø 532-km pipeline linking Mnazi Bay gas field production in southern Tanzania to the capital Dar es Salaam in the north has now been completed and commissioned Ø 36 gas pipeline & gas processing plants are part of a plan to increase Tanzania's generating capacity to 10,000 MW by 2025 Ø Natural gas will be transported to large-scale electricity producers,other industrial users and major populationcentres Ø The pipeline will allow production from existing fields to be ramped up and future fields to be commercially developed Ø Switching to gas-fired power plants can help to save around $1 billion a year in oil importsfor electricity generation The pipeline enables efficient transport of natural gas to the market in Dar es Salaam Large, unsatisfied domestic demand for natural gas is estimated at over 500 mmscfd 12 Slide 11
Kiliwani North Development Licence (KNDL) Solo Oil interest: 6.5% (reducing to 6.175% with TPDC back-in) Operator: Aminex plc (Nduvo Resources) 58.5% (reducing to 30.575% after planned farmout) Other participants: RAK Gas LLC Bounty Oil & Gas NL and Bowleven plc Status: Development Project with imminent gas production to satisfy high national demand of energy from Tanzania. Kiliwani North will provide the Company s maiden production & first revenuefrom Tanzania A recent CPR by Senergy estimated KNDL gross contingent resourcesto 28 bcf Solo's interest will be reduced to 6.175% once TPDC exercises its announced right to back into KNDL for a 5% working interest Solo agreed an option to acquire a further 6.175% interest in the KNDL on the same terms once a GSA is executed GSA is agreed and simply awaiting execution of final terms by TDPC 13 Slide 12
Kiliwani North Development Licence Kiliwani North well (KN-1) gas well, which tested at 40 mmscfd, has been completed and is now ready to produce Daily Production Rate: Estimated 30 mmscfd A gas sales agreement (GSA) is awaiting final sign off from TPDC and the Ministry of Energy The Songo Songo plant is connected to the newly constructed 36-inch pipeline from Mnazi Bay to Dar es Salaam. This will provide a route to monetisation for Kiliwani gas production A 2 km long tie in pipeline pipeline from KN-1 to the new Songo Songo gas processing plant has been completed and pressuretested Slide 13
Next steps in Tanzania Solo Oil is working to optimise the value of its interest in the Ruvuma PSA. Maintaininga strong operational and strategic focus OPERATIONAL STRATEGIC Oversee Aminex s development path, which aims to: Move Ntorya discovery through appraisal to commercial development Add to our geological knowledge through increased exploration 190 km of infill 2D seismic was acquired in 2014 and is being integrated Drill two appraisal wells at Ntorya and commence development planning Add value to the Solo investment through key corporate actions: Look to develop the nature and size of Solo s interests in Tanzania with a view to achieving value increase for our shareholders Add value by participating in the drilling of further explorationwells in Ruvuma PSA Farm down interest to allow a financially stronger partner to come into the development and redeploycapital in otherareas 15 Slide 14
UK: Horse Hill Marriott 50 on Horse Hill 1 well
Horse Hill (Solo Oil interest 6.5%) Solo acquired a 10% interest in Horse Hill Development Limited (HHDL) which is equivalentto a 6.5% interest in the Horse Hill prospect and in PEDL137 and 246 The Horse Hill discovery lies about 3 kilometres north of Gatwick Airport and covers an area of up to 16 square kilometres The HH-1 well reached a total depth at 8,770 feet measured depth in rocks of pre-triassic Palaeozoic age The well was logged and a vertical seismic profile was acquired to correlate the well to existing 2D seismic data Slide 16
Horse Hill Horse Hill-1, drilled end of 2014. Located in onshore licences PEDL137-246 (55 square miles) Two main Reservoirs: Conventional Oil: Upper Portlandsandstone reservoir in the HH-1 and Collendean Farm-1 structure Xodus studyof the UpperPortland discoverestimatesa P50 OIIP of 21.0 mmbbl ~ 8-24% recoverable Work underway to obtain permissions to conduct a production flow test from the HH-1 Upper Portland sandstone Unconventional: Kimmeridge, Oxford and Lias sections Approx 700ft Gross of Oil pay identified by Schlumberger & NuTech NuTech 158 million barrels per square mile Schlumberger 271 million barrels per square mile Total Jurassic Oil in place (NuTech) for 55 square miles for 9.2 billion barrels Kimmeridge limestones 1 billion barrels OIP Kimmeridge shales 4.3 billion barrels OIP Oxford and Lias shales 3.9 billion barrels OIP 9.2 billion barrels total Jurassic Oil in place (NuTech) in 55 square mile licence area Conceptual Low-Impact Oil Development Plan for Jurassic Limestones within the Weal Basin by Xodus and Barton Willmore using multi-well pads with 12 horizontal production wells delivering an estimated 2,500 barrels of oil per dayat peak production,plus an associated productionprocessingfacility site) Slide 17
Nigeria: Burj Africa
Burj Africa (Solo Oil holdings 20%) Burj Africa is a private UK registered company created with the purpose of participating in the current marginal field licensinground in Nigeria Solo exchanged its shareholding in Pan Minerals for a direct holding of 15% in Burj Africa Solo has entered into an agreement to increase its investment in Burj Africa. Solo will acquire an additional 5% for a total interest of20% Joint Venture with: Global Oil and Gas (founded by Phil Mulacek) and Truvent Consulting Application for two marginal fields - 10 wells, drilled by an international major and believed to contain proven and possible recoverable oil reserves of 59.3 mmbbls (13.5 mmbbls net to Burj Africa after royalty) Solo has the right to convert the equity position in Burj Africa for a participating interest directly in the JV with Global in Nigeria Slide 19
Canada: Ontario Reef Ausable Reef well 21
Operated by Ontario Reefs Moving from small-scale production to enhanced oil recovery Solo Oil interest: 28.56% Operator: Reef Resources Status: Dormant Development OVERVIEW: Plan to enhance production oflight oil and liquids rich natural gas assets by re-pressuringproven reef structures ASSETS: The Ausable Reef offeringoil productionpotential, the Airport Reef which offers a natural gas feedstock for the cyclic gas enhanced oil recovery (EOR) program. Plus 3-4 additionalreefsin thesilurian reef complex STRATEGY: Move from a lowrecovery oil productionscheme to a gas cycling EOR program,converting wells and optimising surface facilities PROGRESS: Production commenced atthe AusableField. Two of the four wells were put on line, provingthe development concept. Project currently on hold owing to Operator s financial standing 22 Slide 21
Follow-on potential Operated by Opportunities to grow the EOR operation across the existing licence footprint EXPLORATION POTENTIAL: 23,000-acre 3D survey has delineated numerous Ordovician reefs Several discoveries remain undeveloped and some reefs have not yet been tested for hydrocarbon potential EOR RAMP-UP: Following the commencement of EOR recoveries at the Ausable Reef, there is potential to roll out the same optimised solution at other highly prospective target locations SOLO OPTION: The company has the option to increase its working interest 23 Slide 22
Summary 24
Building shareholder value Type a quote here. Buildingon itsexperience and a highlyprospectivemulti-jurisdictionassetbase,solo Oil is actively working to build value for shareholders across a portfolio ofin-demand commodities TANZANIA UK NIGERIA Successful exploration track record Commercial gas discovery at Ntorya-1 Appraisal through 2 well farm-out carry Significant upside over 4 tcf potential Maiden production and revenue from KNDL Successful exploration track record Upper Jurassic oil discovery in Weald Basin Further exploration potential in PEDL137 and 246 Joint 14 th Onshore Bid Round application Application for two marginal field licences Competent Operator & Local Partner 2P recoverable oil reserves of gross 59.3 mmbbls ADDITIONAL OPPORTUNITIES Further investments with suitable strategic partners Actively looking for opportunities to expand the portfolio Slide 24
CONTACT US T: +44 (0) 20 7440 0642 F: +44 (0) 20 7440 0641 E: info@solooil.co.uk Solo Oil plc Office of the Chairman Suite 4B Princes House, 38 Jermyn Street, London SW1Y 6DN 26