JV Poltava Petroleum Company Company presentation About PPC JV JV - - PowerPoint PPT Presentation

JV Poltava Petroleum Company

Company presentation

About PPC

2 JV PPC – СП ПГНК

JV JV Polt

• ltava Petr

troleum Com Company is a pioneer in Ukraine’s energy sector operating since 1994. The company was established by JKX Oil & Gas plc and was the first successful foreign private investment project in the oil & gas industry in Ukraine. JV PPC is currently one of the leaders among private oil and gas producers. Ou Our prio priorities an and vi vision:

• HSE is our top priority
• dynamic progress and
• maximize cash flow and returns for investors
• implementation of advanced technologies
• constant improvement of operations and processes

Sc Scope of

• f JV

JV PPC PPC Acti ctivities s an and Key Proj

• jects
• il and gas production from core assets
• prospecting and exploration within existing licenses
• identification of growth opportunities and

business development

Our Licenses

3 JV PPC – СП ПГНК

PPC holds 100% interest in five production licenses and one exploration license in the Poltava region of Ukraine:

# Licence Type Expiry 2P Reserves, mmboe Area 1 Zaplavske prospect

Exploration

2019

• 197.5sq.km.

2 Rudenkivske field

Production

2024 22.2 127sq.km. 3 Ignativike field

Production

2024 3.9 4 Novonick field

Production

2024 0.7 5 Movchanivske field

Production

2024 0.6 6 Elizavetivske field West Mashivska area

Production

2034 1.7 104.7sq.km.

• PPC plants

Key Achievements

4 JV PPC – СП ПГНК

During the company's activity: cubic meter of gas produced paid in taxes from 1994 till 2016 paid as dividends to JKX Oil & Gas Invested in philanthropy, social and charitable projects 7 000 000 000 $ 900 000 000 $ 500 000 000 $ 10 000 000

141 79 49 2 1

• ld wells repaired and put into operation

new wells drilled wells in operation State-of-the-art processing facilities LPG plant

414,11 395,49 287,40 287,40 234,15 217,19 192,71 169,01 226,38 131,89 98,28 77,23 59,66 42,75 36,71 40,78 31,40 31,73 2010 2011 2012 2013 2014 2015 2016 2017 2018

Production

Natural Gas, mln cubic meters Crude oil & condensate, kilo tonns

LPG Plant

17.11.2017 5 JV PPC – СП ПГНК

• Before 2011 sales gas contained significant amount
• f C2+ fractions which may be extracted and sold

separately

• PPC invested more than US$10 million in

construction of the LPG plant in 2011

• This project turned into a major success for the

company:

• Project payback period was less than 1

1 year ear

• More than 80,0

80,000 to tons s of PLG produces and sold to date

• More than US$

US$60 mill illion in revenues to date

• Currently we are evaluating options to fully utilize

plant capacity and expand its operations

Innovations and Partners

6 JV PPC – СП ПГНК

Innovations

• First private oil & gas Joint Venture in Ukraine
• First and longest horizontal well in Ukraine
• First multistage frac in Ukraine
• First major gas producer selling through UEEX

1994 2010 2013 2016 Key partners

HSE and Community Development

7 JV PPC – СП ПГНК

En Environment

Monitoring of groundwater, soil and air quality Regular measurements

• f environmental

indicators Environmental protection Prevention of environmental damage, use of non-waste production technologies Strict HSE standards Collaboration with local communities and the government Education and personal development Health and social insurance Improvement

• f the region

Construction and reconstruction of roads and infrastructure Development of sports

• rganizations of the

Poltava region Support of children's homes and boarding schools

Peo eople Com Community

Growth potential

8 JV PPC – СП ПГНК

Ukraine retains significant hydrocarbon potential

• Currently producing only 2% of proved reserves (vs. 10-15% in Europe and US)
• Large on-shore and off-shore exploration potential
• Large unconventional potential (poorly understood)

Government focused on achieving energy independence (increase production by 40%) by 2020

• Upstream regulatory reform underway
• Prospect of significant reduction of royalty on new wells (from 29 to 12%) in 2018
• New licensing round in 2018 likely

Existing PPC assets either mature (limited upside potential) or require significant additional study Upstream business development opportunities for PPC:

• M&A: Find attractive and accessible existing private licenses
• Zaplavska license expansion
• Licensing of new appraisal/exploration areas

Ukraine Retains Significant Upstream Potential

20 40 604 970 4000+ 10000+ 1 10 100 1000 10000