Corporate · PDF fileCorporate Presentation November ... or listing particulars relating to the Company and has not been approved by the UK Listing ... Senior exploration, new

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www.sterlingenergyplc.com August 2015

Corporate Presentation

November 2017

www.sterlingenergyplc.com

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Disclaimer

This presentation has been prepared by, and is the sole responsibility of, the directors of Sterling Energy plc (the ‘Company’).

This presentation and the information contained in it does not constitute a prospectus or listing particulars relating to the Company and has not been approved by the UK Listing

Authority, nor does it constitute or form any part of any offer or invitation to purchase, sell or subscribe for, or any solicitation of any such offer to purchase, sell or subscribe for, any

securities in the Company, nor shall this presentation or any part of it, or the fact of its distribution, form the basis of, or be relied upon in connection with, any contract therefore.

No reliance may be placed, for any purposes whatsoever, on the information contained in this presentation, or upon its completeness or accuracy and this presentation should not

be considered a recommendation by or on behalf of the Company or any of its directors, members, officers, employees, agents, advisers or any other person in relation to any

purchase of, or subscription for, ordinary shares.

No representation or warranty, express or implied, is given by or on behalf of the Company or any of its directors, members, officers, employees, agents, advisers or any other

persons as to the accuracy, fairness, completeness or sufficiency of the information or opinions contained in this presentation and none of the information contained in this

presentation has been independently verified or approved. All financial information contained within this presentation has not been approved by the Company’s auditors and, as

such, may be liable to change. Save in the case of fraud, no liability is accepted for any errors, omissions or inaccuracies in such information or opinions.

This presentation and its contents and any accompanying information communicated verbally as part of the presentation, including the speeches of the presenters, any question

and answers session and any materials distributed in connection with it, is being made only to and is directed only at (i) persons in the United Kingdom having professional

experience in matters relating to investments, being investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial

Promotion) Order 2005, as amended (the ‘FPO’), (ii) high net worth companies, unincorporated associations and other bodies in the United Kingdom within the meaning of Article

49(2) of the FPO, (iii) in the United States to persons the Company reasonably believes to be qualified institutional buyers, as defined in Rule 144A(a)(1) of the United States

Securities Act of 1933, as amended (the ‘Qualified Institutional Buyers’) and (iv) persons to whom the presentation may otherwise lawfully be made (together ‘Relevant Persons’).

This presentation must not be acted on or relied upon by any persons who are not Relevant Persons. Any investment or investment activity to which this presentation relates is

available only to Relevant Persons and will be engaged in only with Relevant Persons.

Neither this presentation nor any copy of it may be distributed, forwarded to, or transmitted in or into the United States of America (except to persons the Company reasonably

believes to be Qualified Institutional Buyers), Canada, Australia, Republic of South Africa, Japan or their respective territories or possessions or to any national, citizen or resident

thereof or any corporation, partnership or other entity created or organised under the law thereof, nor into any other jurisdiction where the distribution thereof would breach any

applicable law. Any failure to comply with the foregoing restrictions may constitute a violation of United States, Canadian, Australian, South African or Japanese securities laws. The

distribution of this presentation in other jurisdictions may be restricted by law and any persons into whose possession this presentation comes should inform themselves about and

observe any such restrictions.

This presentation must not be copied, reproduced, published, distributed, disclosed or passed to any other person at any time without the prior written consent of the Company. By

accepting receipt of this presentation you agree to be bound by the limitations set out above.

Certain statements in this presentation are or may constitute ‘forward looking statements’. Such forward looking statements involve risks, uncertainties and other factors which may

cause the actual results, performance or achievements, or industry results, to be materially different from any future results, performance or achievements expressed by such

forward-looking statements. The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice.

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Corporate profile

Corporate snapshot

LSE-SEY Ticker

(AIM listing 2002)

GBP £0.151 Share price

220.1 Shares outstanding

(million)

220.1 Fully diluted share positions

(million)

$43.2m1 Market capitalisation

(US$ million)

$0 Debt (US$)

$83.1m Cash at 30 Sept 2017

(US$ million)

Q3 2017 Financial summary (30 Sept-17)

Turnover $1.7m

Economic Interest daily

production (bopd) 188

Adj. EBITDAX

(US$ million) ($1.4m)

*0.3% of issued share capital under option

Advisors

1 as at 2 Nov-17

Share ownership*

Waterford

Finance &

Investment

(29.45%)

YF Finance

(16.64%) Mistyvale

(15.66%)

Denis O’Brien

(7.16%)

Banque Heritage

(6.78%)

Retail &

Institutional

(24.3%)

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32

Years

22 Years

Senior exploration, new ventures & management positions at Enterprise Oil,

Shell International, Marathon Oil & Apache (UK, US, Brazil and Australia).

Former Head of new ventures at Petrobras Oil & Gas BV (Africa focused

Private Equity JV). Mr Jersing has a BSc in Geophysics and an MSc in

Petroleum Geology from Imperial college.

Eskil Jersing

CEO

Michael

Kroupeev

Non Executive

Chairman

Shareholder aligned Board

Shareholder aligned Board (45% of fully diluted share positions represented)

Founding Director, Waterford Finance & Investments Ltd (Oil & Gas focussed

investment vehicle with shareholdings in companies with operations in Europe,

Africa, North America and Australasia)

Previously Non-executive director of Sibir Energy Plc & Dana Petroleum Plc

29

Years

Senior E&P executive with an MSc. in Petroleum Engineering from Delft

University, the Netherlands. Following a successful career with Shell

International, he has been involved in multiple successful business start ups of

scale including EDP ltd, TAQA Bratani (UK) Ltd and TAQA Iraq BV. Executive

Chairman at Columbus Energy Resources plc

Leo Koot

Audit, Remco

Chairman & NED

12

Years

Representing Mistyvale Ltd. Investor in Private equity and Venture capital

projects through Supremum capital and Concentric VC. Focus on finance and

real estate sectors in Russia and UK. Previously with JP Morgan, Barclays

capital and VEB capital in M&A, Corporate finance and capital markets. Mr

Belyaev has an MSc in Mathematics from Moscow State University.

Ilya Belyaev

NED

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Transformative growth platform / shell

Major shareholders represented on the Board

Strong balance sheet, with ~US$83.1 million cash and

disciplined approach in low oil price landscape

Debt free & fully funded

Continued Portfolio management

Pro-actively focused on Chinguetti abandonment &

decommissioning (A&D) program

Odewayne revised farm-out terms (Payment of $3.5m

and transfer of 6% to Petrosoma to cancel $8m

contingent payment in April 2017)

Odewayne 1,000kms 2D seismic campaign complete

Mauritania C-10 disciplined exit at low cost

Capital discipline

Q4 2017 move to smaller office

2017 G&A costs ca.31% lower than 2016 (2018

forecast of $2.9m)

Focused M&A

Transformative shareholder driven mandate

Broadened jurisdictional focus

2P/2C onshore / shallow water bias with low break

evens

Disciplined M&A driven growth

Value driven, uniquely positioned for material growth

Mauritania

Somaliland

Odewayne

Sterling 34%

Genel 50% Op.

Petrosoma 16% PSC-B Chinguetti

Sterling ~ 9% E.I.

Petronas 47.38%

Op.

M&A focus

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2016 2017 2018 2019

Country Asset H2 H1 H2 H1 H2 H1

Growth / M&A projects

Somaliland

(Frontier)

Odewayne

(34%*) 2013 entry

2D Seismic and well costs

fully carried

Mauritania

(Producing)

Chinguetti

(ca.9.5%) 2004 entry

Decommissioning

Activity Timeline

Focus on transformative growth

Note: Company estimates

Regional studies

Due diligence & execution

1,000 km 2D Seismic

Decision to

Enter Phase 4 Drilling

Production Decommissioning & Abandonment

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Somaliland – Odewayne

Recently completed 1,000km 2D seismic program (first ever on block)

• Joint Venture

− Genel (Operator) 50%, Sterling 34%, Petrosoma 16%

− Revised Farm-out terms with Petrosoma in April 2017 (US$8m

contingent consideration cancelled for payment of US$3.5m and

transfer of 6% interest in the PSA)

• Onshore frontier exploration

− Genel targeting resources of over one billion barrels of oil

− Huge onshore block of 22,840km², equivalent to +/- 100 UKCS

Blocks.

− Low cost 2D acquisition, drilling and access to Berbera deep water

port less than 100kms to North

• Licence Terms and Commitments

− Carried by Genel for all costs in Periods 3 & 4 (to 1st well)

− Period 3: May 2012 – November 2018

− Airborne gravity and magnetics survey - completed

− Acquire 500km 2D seismic data Q2 2017

− Period 4: November 2018 – May 2020

− Acquire 1,000km 2D seismic data

− Drill one exploration well

• Status

− Government operated (MOEM) multi client 2D seismic acquisition

program completed August 24th 2017

− 2D seismic program on Odewayne block exceeds minimum work

obligation for Period 3

Odewayne - Sterling

Energy 34%

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Somaliland - Odewayne

Unexplored Mesozoic rift basin

Pre-rift configuration

Petroleum System

− Huge frontier exploration block with no seismic

control and no drilling to date

− 32 deg API flowed to surface from Jurassic

carbonates in DS-2 well to the north of the block

− Rift basin interpreted to be deep enough for

Jurassic source rocks to be mature (3.5km+),

possibly of Permo-Triassic Karoo age

− Active petroleum system confirmed by oil seeps

within the block

− Sub-surface basin structure identified by 2013

aero-magnetic survey; multiple 3-way fault-

controlled traps likely with sedimentary fill as key

unknown

2017 2D seismic acquisition program

− Completed August 24th 2017

− 1,000kms full fold Vibroseis acquisition program

− Initial results have offered encouragement for infill

targeted campaign

− Contracted to BGP

− Full Pre Stack Time migrated data set expected in-

house late Q4 2017 – early Q1 2018

2017 2D seismic program

Odewayne Basin

Vibroseis

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Mauritania – PSC B Chinguetti

Oil production funding and royalty income

• Chinguetti Oil Field

− First commercial oil field discovered in 2001 by Woodside

− 80kms offshore in 800m WD

− Gross field production for 2016 averaged 4,549 bopd

− Petronas 47.38% (Op.), Tullow 22.26%, Premier 8.12%,

Kufpec 10.24%, Société Mauritanienne Des Hydrocarbures et

du Patrimoine Minier (SMHPM) 12%

− Cessation of production and commencement of abandonment

and decommissioning in December 2017

• Sterling position

− Established since 2004

− Company entitlement to economic interest via:

1. Funding Agreement (‘FA’) with SMHPM (ca. 9.5% of cumulative

production). Net economic interest to Sterling for the year to Q3

2017 averaged 272 bopd

2. Royalty Agreement (‘RA’) with Premier Oil over 5.28% of Premier’s

share of production

− Working with Chinguetti field stakeholders on executing a

safe, cost effective, technically robust decommissioning and

abandonment plan for the field from Q4 2017.

PSC B (Chinguetti)

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Ancillary information November 2017


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Sterling Management team

Senior exploration, new ventures & management positions at Enterprise Oil, Shell, Marathon &

Apache (lived and worked in UK, US, NL, Brazil and Australia). Former Head of new ventures at

Petrobras Oil & Gas BV (Africa focused Private Equity Joint Venture). BSc in Geophysics from

Cardiff University and MSc in Petroleum Geology from Imperial College London.

Eskil Jersing CEO

Anish Airi Subsurface & Reservoir

Engineering Manager

James Munt Senior Finance Manager

Oil and Gas experience covering all aspect of finance and accounting, specialising in

Group and Joint Venture accounting. Focused on assets in Africa, Middle East and the US.

International upstream experience from numerous locations including Nigeria, Norway, Oman,

Kenya, Netherlands and Kuwait. He has worked for Shell International, Shell Trading, Nexen

International, MRI and was Technical Director EMEA at Macquarie Group. MSc in Chemical

Engineering from Imperial College London.

19 Years

32

Years

17 Years

Mary-Ann Page HR/Office Manager

Human resource professional specialising in the Oil and Gas sector. Managerial

experience focused on HR, HSE, IT, Facilities Management and Procurement. 33 Years

Simon Compton Head of Commercial &

Legal

31 Years

International upstream experience in 50 countries and 30 appraisal and development

projects, specializing in investment appraisal, petroleum economics and business

development. He has worked with BHP, Enterprise Oil, Hess, Premier Oil, Gulf Keystone

and BMO Capital. MSc in Sedimentology from the University of London.

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Sterling Energy

E&P evolution

2002

2004

2005

2006

2009

2010

2013

2014

2015

Listing on AIM

Acquisition of Fusion Oil & Gas plc

Chinguetti field, Mauritania, Funding & Royalty agreement

Farm out of Ambilobe & Ampasindava blocks in Madagascar

First production from Chinguetti oil field , Mauritania

2003

Share placing and Board changes following sale of US business

Sangaw North well drilled in Kurdistan (fully carried)

Two-stage Odewayne block, Somaliland farm-in, (carried in phase III & IV)

Ambilobe block, Madagascar farm out to Pura Vida

Bamboo well drilled in Ntem block Cameroon (fully carried)

C-3 block Mauritania farm-in with Tullow (ground floor)

Ambilobe block Madagascar Operated 3D survey (fully carried)

Ampasindava block Madagascar relinquishment (disciplined data driven decision)

C-10 block Mauritania farm-in / entry with Tullow (ground floor)

2007 Acquisition of Whittier Energy corporation (USA)

2008 Themis Admiral Marin & Iris Charlie Marin wells drilled Gabon

2016 C-3 block Mauritania exit (post new 2D evaluation – disciplined data driven decision)

Ambilobe block Madagascar exit (post new 3D evaluation – disciplined data driven decision) Transformative

M&A

Ntem, Cameroon exit (disciplined relinquishment based on remaining prospectivity vs. work commitments) 2017 Odewayne, Somaliland, Revised Farmout terms to cancel contingent payments to Petrosoma

C-10 block Mauritania exit (disciplined commercial decision)

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Somaliland – Country Overview

Frontier opportunity

• Government

– Somaliland (637,000 km2) was a UK protectorate from

1884 until 1960

– Declared independence from Somalia in 1991; allowed

development of a stable, democratic government

– Not recognised as an independent nation but

favourable political contacts with a number (ca. 35) of

countries including UK

• Economy (2014)*

− GDP: $1.4 billion (ca.$347 per capita)

− Real GDP increasing by 3.7% pa since 2014

− Livestock (10 million goats, 5 million sheep, 5 million

camels and 2.5 million cattle) provide economic back

bone (60-65% of Notional economy)

− Population 6.2 million

• Oil & Gas

– Berbera Deepwater port ca 100kms from Odewayne

block

– Immature Exploration sector, No production to date

* Source World Bank

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Mauritania – Country Overview

Stable Democracy - growing world class Oil & Gas province

• Government

− Islamic Republic of Mauritania (1,030,700 km2)

− President Mohamed Ould Abdel Aziz:

− Held office since 5th August 2009

− Elected for further 5 year term in June 2014

• Economy (2016)*

− GDP: $16.7 billion (purchasing power parity)

− 3.2% real growth rate

− Population 3.7 million

− Industry 35%, Agriculture 24%, Services 41%

− Currency Ouguiya (MRO)

• Oil & Gas*

− Oil production ~ 4,549 bopd (2016 average)

− Oil imports ~12,810 bopd

− Gas production 0 m3 per annum

− Proved gas reserves ~1 Tcf

− Recent world class gas discoveries by Kosmos,

operator Pmean resources ~50Tcf across

Mauritania-Senegal

* Source CIA fact book

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website www.sterlingenergyplc.com

e-mail: [email protected]

52-54 High Holborn, London, WC1V 6RL

Tel: +44 (0) 20 7405 4133

Fax: +44(0) 20 7440 9059

Documents

Corporate · PDF fileCorporate Presentation November ... or listing particulars relating to the Company and has not been approved by the UK Listing ... Senior exploration, new