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Corporate Presentation April 2007

Corporate Presentation April 2007. Outline of Presentation. Company overview Business overview Financial highlights Future plans and strategy. Company. overview. Corporate Events. Vision. To be the leading energy player in the PRC and USA market s To enhance shareholders’ value by:

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Corporate Presentation April 2007

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  1. CorporatePresentationApril 2007

  2. Outline of Presentation • Company overview • Business overview • Financial highlights • Future plans and strategy

  3. Company overview

  4. Corporate Events

  5. Vision • To be the leading energy player in the PRC and USA markets • To enhance shareholders’ value by: • reinforcing interest in existing profitable projects • continued investments in energy-related businesses with focus on up- to mid-stream activities through acquisition or formation of joint ventures with leading PRC players in the sector or local governments • maintaining balanced mix of revenue/profit from oil and gas projects • investing in projects with an IRR of at least 15%

  6. A Diversified Energy Company

  7. Existing Mid/Downstream Operations in PRC • Ta He oil field, Xinjiang Province (discovered in 1998) • Transportation of crude oil exploited from the Ta He oil field to Lun Tai railway station via pipeline • Korla City, Xinjiang Province • Supply of natural gas to users through pipelined network • Operation ofCNG/LPG refilling stations for automobiles

  8. Shareholding Structure Hong Chang Group Ltd 100% China GeoMaxima Public 1.41% 40.38% 58.21% Genesis Energy (Bermuda)

  9. Business overview

  10. Downstream: Gas distribution • Genesis Energy has interests in a natural gas distribution project: • Korla City, Xinjiang Province is an industrial city located in the western parts of China, (the 2nd largest city in Xinjiang Province) • Total coverage of over 60,000 households • Pipeline infrastructure in place • Balanced mix of residential, commercial, industrial and commercial vehicle customers • Project concessions with franchise terms of 20 years • Natural gas are sourced from gas fields operated by PetroChina under long-term gas purchase agreement (20 years) at prices in line with State regulations

  11. Downstream: Gas Distribution • Fee scheme of natural gas distribution project: • Approved connection fee at RMB600 per household • Approved gas usage charge at RMB1.25 per m3 • Residential customers pay RMB1.25 per m3 • Commercial and industrial customers pay RMB1.25 per m3 • Automobiles pay RMB1.8 per m3 (CNG) and RMB1.05 per litre (LPG)

  12. Downstream: Gas Distribution • Korla gas project: • One processing station with a designed daily capacity of 500,000 m3 • Pre-payment method through smart card system is used for majority of residential customers • 3 CNG/LPG refilling stations for automobiles (primarily public vehicles such as taxis and buses) exclusively in Korla city Gas refilling stations

  13. Midstream: Oil Transportation Station at oil field Station at the railway station Oil tanks at the railway station • 80%:20% joint venture and strategic partnership with Sinopec National Star Petroleum Corporation (“SNSP”) in the Ta He oil transportation project • The only such project in PRC with foreign investment/ participation • Steady income flow from transportation of crude oil exploited from the Ta He oil field via a pipeline to the Lun Tai railway station – the only private pipeline operating in the area

  14. Midstream: Oil Transportation • Long term JV agreement with SNSP (the operator of the Ta He oil field): • Exclusive rights to transport and store crude oil exploited from the Ta He oil field • Fixed charges that are independent of prevailing crude oil price): • Oil transportation at RMB41 per tonne per kilometer • Crude oil transported are consumed by refineries owned by the Sinopec Group

  15. Midstream: Oil Transportation • Key operational data of the Ta He oil project:

  16. Financial highlights

  17. Financial Performance Highlights • Turnover of 2006 up 6% yoy: • Oil transportation segment: New transportation agreement with CPCC in place to ensure a stable source of revenue • Gas distribution segment: Improved sales of natural gas at refilling stations

  18. Financial Performance Highlights • Net loss in 2006 narrowed significantly by 68% yoy: • Despite increased finance expenses, impairment of a long standing receivable and loss on exchange • Target to turn around in 2008 by limiting exposure to current loss making operations and tapping into upstream business fronts

  19. Financial Performance Highlights

  20. Financial Performance Highlights

  21. Financial Performance Highlights

  22. Future Plans and Strategy

  23. Future Plans • Genesis Energy will continue to focus on oil and gas related activities in China and USA • Achieve organic growth through: • Increasing transportation volume while Ta He oil field increases production target to 5.40 million tonnes in 2007 • Increasing connection penetration and gas consumption at existing locations • Growth by acquisition and formation of new JVs • New projects include: • Grassy Trail Oil Field, Utah, USA (Acquisition to be completed in May 2007) • Qian An Oil Field in Jilin, the PRC (MOU signed on Feb 5, 2007) • A prospective onshore and offshore oil project in Liberia (LOI signed in Apr 2007) • Possible disposal of some existing assets in 3Q, 2007

  24. Upstream Investments • Oil fields at a glance:

  25. Upstream: Grassy Trails Oil Field • Acquired 100% interest on Jan 10, 2007 • Located in Emery County, Utah, USA • The oil field was discovered in 1962 and has produced more than 636,800 barrels of golden-colored, light, sweet crude oil till June 2006 • Total coverage of 6,268 acres • Proven reserves of 12 mln barrels • Adding 18 1500 ft laterals on 10 existing wells to recover 1.04 mln barrels • Drilling 9 new wells with 1500 ft lateral to recover another 1.46 mln barrels

  26. Grassy Trail “Productive Fairway” as defined by well history is depicted by the solid black outline. Our geologist proposed fairway depicted by dashed green line and comprises an A zone horizontal drilling development area of 1,840 acres.

  27. Operator of Grassy Trails • A 5-year operating agreement signed with Integrated Energy LLC • Acquired, drilled and completed over 250 commercially productive wells • Mr. Wayne Stout, founder and CEO of Integrated Energy • Educated at UC Berkeley (1971-75) • 30 years of experience in the oil and gas industry in USA • Planned hiring of drilling teams from PetroChina to further reduce cost

  28. Prospective Yield of Grassy Trails • Assuming an average crude price of USD56.64* a barrel • The 1.04 mln barrels will yield a total net income of USD27.98 mln in coming 5 years • The JV will likely to record a positive net cash flow as early as Feb 2008 • Drilling 9 new wells in 2nd phase will record another 1.46 mln barrels of crude oil which may yield additional gross income of USD82.7 mln thereafter • Possibility of finding significant natural gas and CO2 reserves at later stage (* The simple average of West Colorado sweet crude prices in the last 15 months)

  29. Estimated Cost Structure ofGrassy Trails

  30. Investment Highlights ofGrassy Trails • A unique diversified energy company operating in the oil and gas related business in PRC and USA • Low business/ operating risk • Steady and stable long term income stream from the Ta He oil project that is independent of prevailing crude oil price • No reliance on any particular stream of income • Gas network in Korla focus on high volume industrial gas users

  31. Investment Highlights ofGrassy Trails • Clear and visible growth path • Penetration into oil drilling business • Consolidation of interest in existing gas projects • Good relationship with strategic partner, Sinopec National Star Petroleum Corporation Satellite picture showing location of Grassy Trails oil field.

  32. Disclaimer and Confidentiality • The information provided to you in this presentation does not constitute or form part of any offer for subscription or sale of, or solicitation of any offer to subscribe for or sale of any securities of Genesis Energy Holdings Limited nor shall it form the basis of, nor can it be relied on in connection with, any contract or commitment whatsoever. • The information provided to you in this presentation is given on a confidential basis and must not be passed to, or their contents disclosed to, any other person and no copy shall be taken thereof.

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