Ray Leonard President & CEO

Transcription

1 West Africa - Offshore Guinea - Exploration Ray Leonard President & CEO January 2013

2 Forward Looking and Other Cautionary Statements This presentation contains forward looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding Hyperdynamics Corporation's future plans and expected performance that are based on assumptions the Company believes to be reasonable. Statements preceded by, followed by or that otherwise include the words "believes", "expects", "anticipates", "intends", "projects", "estimates", "plans", "may increase", "may result", "will result", "may fluctuate" and similar expressions or future or conditional verbs such as "will", "should", "would", "may" and "could" are generally forward-looking in nature and not historical facts. A number of risks and uncertainties could cause actual results to differ materially from these statements, including without limitation, funding and exploration efforts, fluctuations in oil and gas prices and other risk factors described from time to time in the Company's reports filed with the SEC, including the Company's Annual Report on Form 10-K for the fiscal year ended June 30, Information reported on this presentation speaks only as of today, and you are advised that time sensitive information may no longer be accurate after today. The Company undertakes no obligation to publicly update these forward looking statements to reflect events or circumstances that occur after the issuance of this news release or to reflect any change in the Company's expectations with respect to these forward looking statements. Investors are cautioned that these statements are not guarantees of future performance, and actual results could differ materially. Potential risks include, among other. things, geologic risks, political risks, oil and gas price volatility, uncertainties inherent in oil and gas production operations, government regulation and uncertainties regarding access to capital. 2

3 World-Class Potential Offshore NW Africa 37% interest holder of rights to a 25,000- sq-km license area offshore Republic of Guinea in Northwest Africa -- equivalent of 2,500 Gulf of Mexico blocks License area comparable to a petroleum province, not a one-prospect block / contains multiple play types, leads and prospects Prospects are in a virgin basin at the intersection of several prospective exploration trends First deepwater well completed in February 2012 showed oil in the basin, setting up further exploration opportunities and securing the concession thru 2016 Strong progress since July 2009 under new management and board 40% & operator 23% 37% 3

4 Hyperdynamics Achievements to Date Build Technical, Financial Capabilities & Prepare to Drill Drill Frontier Basin & Evaluate Farm Out & Explore the Deep Water & Beyond New management team joins Hyperdynamics 10,000 km 2D seismic acquired, processed and interpreted Amended production sharing contract negotiated, signed and ratified Raised $18 million Dana Petroleum joins as 23% partner 1 st Sierra Leone discovery by Anadarko NSAI resource report indicates multi-billion-barrel potential Blackrock joins as 15% investor 3,600 sq km 3D acquired, processed, interpreted, well location chosen Raised $204 million Rig tender completed Sabu-1 spud October, completed February 2012 encountered noncommercial oil shows 4,000 sq km 3D acquired in deepwater portion of block Successful Farm-out to Tullow for 40% of the total concession interest Incorporate results of Sabu-1 well in geologic model, process and interpret new 3D program Initiate new drilling program in the deep water and use best efforts to spud by April 1, 2014 French Guiana discovery by Tullow, Sierra Leone discoveries by Anadarko, 1st Liberia discovery by African Petroleum 4 4

5 Recent Farm-Out Farm-Out In December 2012 Hyperdynamics sold a 40% interest in the concession and will transfer operatorship to Tullow Oil plc Total value to HDY of up to $101 million, including: $27 million up front cash Full carry on the next exploration well up to a total gross well cost of $100 million Additional full carry on an appraisal well, if drilled, up to a total gross well cost of $100 million The Rationale Expertise and exploration success in the Atlantic Margin off West Africa particularly the Transform Margin play present on the Guinea acreage Experience in deepwater production Financial strength needed to explore this large block Availability of suitable rigs to initiate the deepwater drilling Endorsed by the government of Guinea 5

6 Tullow World Class Operating Partner One of the largest independent oil and gas exploration and production companies in Europe and Africa's leading independent oil company Tullow s Asset Overview in West and North Africa 1 Congo (Brazzaville) Development & Production 2 Cote d Ivoire Exploration, Development & Production 3 Equatorial Guinea Development & Production 4 Gabon Exploration, Development & Production 5 Ghana Exploration, Development & Production. 6 Liberia Exploration 7 Mauritania Exploration, Development & Production 10 8 Senegal Exploration 9 Sierra Leone Exploration 10 GUINEA Exploration Sources: Tullow Fact Book July

7 Strong Exploration Credentials Tullow s success rate on exploration and appraisal wells is 33 out of 46, or 72%, according to its July 2012 Fact Book. Tullow has two rigs under long term contract in West & North Africa The West Leo (Seadrill) and the Sedco Energy (Transocean). Both rigs capable of operating in 7,500 ft water depth. The West Leo is rated at 10,000 ft.. Sources: Tullow Fact Book July

8 Offshore Guinea Basin Exploration Timeline 25% Relinquishment 2012 Sabu-1 Q1 3D Depth Q2 3D Depth Q Q1 Q2 Q Complete Quick Look Volume Interpret 3D Seismic Survey Analyze Sabu Data Final 3D Processing (Depth, Time) Select submarine-fan prospects Spudding of deep-water submarine fan well expected before April 1, 2014 Financial terms of the Tullow farm-in should position Hyperdynamics to carry out the next key phase of exploration offshore Guinea in the highly prospective deep water. 8

9 Offshore Discoveries - Pre-rift reconstruction GUINE A BISSA U Sabu-1 Well Guyana Jagua r Zaedyus Sabu-1 Well Venus Mercury Guinea Sierra Leone & Liberia Narina Venus Mercury Twenebo Sankofa East Narina a Paon Jubilee Suriname South America French Guiana Paon Tweneboa Ghana & Cote d Ivoire Jubile e Sankofa East Pecém Jaguar Eagle Brazil Source: http;//cgxenergy.ca/at-a-glance.aspx Zaedyus This map is a reconstruction for 108 MY ago, prior to deepwater fan formation, with Africa fitted against South America, before the Equatorial Atlantic oceanic crust formed 9

10 10 Exploration Potential of Offshore Guinea Block Offshore oil seeps, typed to Jurassic or Early Cretaceous carbonate source rock Offshore oil seeps, typed to Late Cretaceous marine source rock Survey B Survey A Survey C Neocomian Carbonate Prospects Survey A Prospects Submarine-Fan Prospects 20 km

11 Interval of Hydrocarbon Shows Oil Shows Gas Shows Sabu-1 Well Geological Results Eocene Paleocene Paleocene Shale Top Cretaceous Campanian Santonian Turonian Sabu-1 Results Drilled to planned depth of 3,600 meters below water line Met the drilling obligation for Petroleum Sharing Contract for current exploration period Encountered oil and gas shows during drilling through part of target section Well logs indicate oil (residual, likely the result of failed trap or seal) Cenomanian Pre-Cenomanian Sabu-1 Implications Demonstrates proven petroleum system in Guinea Basin Increases chance of success of a deeper water oil exploration program Supports extension of a developing oil trend along Atlantic Margin from Ghana to Guinea Dominantly sandstone Dominantly shale Dominantly carbonate 11

12 Depth in meters 12 Exploration Target In an early view of the new 3D survey (Survey C), we can clearly see features with geometries suggestive of submarine fans Possible Deep Water Submarine Fans Amplitude extraction of one horizon Yellow sandstone Gray shale 3D line from 2012 survey (fast-track time converted to depth) 1000 m

13 Leadership Herman J. Cohen Director Fred Zeidman Director Robert Solberg, Chairman Ray Leonard CEO Lord David Owen Director Bill Strange Director Past U.S. Ambassador to Senegal and Gambia, Asst Secretary of State for African Affairs, President of Cohen & Woods International Currently serves as Chairman of Xroads solutions group and has served as CEO and Chairman of a variety of companies Retired President of Worldwide E&P Development for Texaco Division Geologist for West Africa and V.P with Amoco, Executive with YUKOS, MOL, and V.P. of Kuwait Energy Company Past Chairman of YUKOS International UK and Secretary of State for Foreign and Commonwealth Affairs, Retired British MP Retired Partner of Deloitte & Touche. 41 years of public accounting experience in the areas of SEC and the energy industry Steve Barrett VP of Exploration Exploration VP, Nations Petroleum. VP First International Oil, Exploration Manager Amoco Mike Palmer SVP of Operations 19 years at Amoco. Nations Petroleum for 9 years initially as the head of the Kazakhstan operation before taking over their Azerbaijan project Paul Reinbolt Chief Financial Officer 31 years at Marathon Oil Corporation. 10 years as Marathon s VP Finance & Treasurer 13

14 Disconnect between March 2011 to January 2013 As of March 2011 As of January 2013 ~$35 million Cash On Hand ~$55-$60 million -2D -3D on shallow portion of the block Seismic Data -2D -3D on shallow portion of the block -3D on the deepwater portion of the block (most prospective) No signed contract Rig Rig was contracted to drill Sabu-1 Obligation to spud before year end 2011 and drill it to a minimum depth of 2,500 meters There was no geological control in the deep water portion of the basin PSC Secure Confirmed Active Petroleum System and Geological Control Point Sabu-1 well was spud on October 13, 2011 and reached a total depth of 3,601 meters Confirmed evidence of the presence of an active petroleum system, and high quality reservoir rock and oil in the basin and now we have a geological and geophysical control point Hyperdynamics acted as operator Operator Tullow, a leading European oil company with success along the transform margin $800 million Market Cap $100 million 14

15 Why Should You Consider Owning HDY? Low-cost access to one of the most prospective offshore exploration plays in the world today Guinea Basin has been meaningfully de-risked thru 3D seismic studies and the Sabu-1 well, which demonstrated the presence of an active petroleum system New operator Tullow is a world-class partner with an excellent track record of exploration success offshore West and Northwest Africa HDY has a solid financial position entering the next phase of exploration Substantial upside potential for investors with the right risk profile 15

16 Appendix Financial Data Share Price Performance Selected Financial Data Estimated cash based on September 2012 balance and proceeds from Farm-in $55-$60 Million Long-term Debt $-0- Outstanding Shares as of September 30, ,667,731 Fully diluted shares as of September 30, ,009,279 Market Cap as of January 3, 2013 $105 Million Analyst Coverage Key Shareholders as of September 2012 Retail Institutional Investors BlackRock 13% The Vanguard Group 6% 16

17 Appendix - Production Sharing Contract Economics Gross Production 100% Governmental Royalty - 10% Contractor s Cost Oil 1 - Max 75% Daily Production Government Contractor (Barrels/Day) Share (%) Share (%) Profit Oil - (Min 15%) 0-2, ,001-5, , , > 100, Contractor Profit Oil 1 Governmental Profit Oil 1 Note: Government may participate in development, taking up to a 15% participating interest, carried to time of first production. Carry is recovered by Contractor out of 62.5% of Government s share of cost oil and profit oil. 17

18 Appendix PSC Terms Exploration Phase Period Duration, Yrs Dates 1 st Exploration 4 Sep 06 Sep 10 2 nd Exploration 3 Sep 10 - Sep 13 2 nd Exploration - Renewal 3 Sep 13 - Sep 16 Total 10 Further extensions available for work in progress (1 yr) and to appraise a discovery (2 yrs) Requirements for Second Exploration Period ACCOMPLISHED: the acquisition of a minimum of 2,000 square kilometers of 3-D seismic data and the drilling of an exploration well to a 2,500m minimum depth 18