Company presentation. Meeting a surging deepwater development demand. Company update December Building on solid industry track records

Transcription

1 Company presentation Company update December 2007 Meeting a surging deepwater development demand Building on solid industry track records

2 Disclaimer forward looking statements This presentation has been prepared by FPS Ocean AS ( FPS Ocean or the Company ) solely for the Company s use in presenting its business or marketing its services to prospective business partners, clients, investors or any other party. The Company will not be making any representation or warranty, expressed or implied, or assurance of any kind as to the accuracy, reliability or completeness of the Presentation. Neither the Company nor any of their respective directors, officers or employees will thus have any liability or responsibility to the recipients of the Presentation or any other persons resulting from their use of the Presentation. The content of this Presentation includes and is based, inter alia, upon forward-looking information and statements that are subject to risks and uncertainties. These statements are based on current expectations, estimates and projections about global economic conditions and the economic conditions of the regions and industries that represent major markets for the Company. Important factors that could cause actual results to differ materially from those expectations include, among others, macro economic fluctuations, interest rates, oil prices and such other factors as may be discussed from time to time in the Presentation. No assurance can be given that those expectations will be achieved or that future results will be as set out in the Presentation. This Presentation represents our initial views and we reserve the right (but shall not be obliged) to revise, update or replace any statement herein. By relying on this Presentation you acknowledge that you will be solely responsible for your own assessment of the information contained herein and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the Company s business. In addition, this Presentation and the analyses set out herein are not and do not purport to be an appraisal or valuation of any of the securities, assets or businesses of the Company. This Presentation is subject to Norwegian law, and any dispute arising in respect of this Presentation is subject to the exclusive jurisdiction of the Norwegian courts. 2

3 Projects FPSO conversion ongoing, deepwater technology being developed DeeP Producer 1 (DPP1); Panamax shuttle tanker Nordic Laurita, built Tsuneishi Japan 1981, delivered in July 2006, drydocked and classed August 2006, entered Dubai Drydocks May 2007 for conversion to Dynamic Positioning FPSO. Ready for First Oil 3Q08. DeeP Producer 2 (DPP2); Double sided Aframax tanker Semakau Spirit, built Koyo Japan 1988, purchased for delivery July Slots secured with Dubai Drydocks for conversion August 2008, scheduled completion Q Long lead items secured. 3

4 Shareholders 20 largest shareholders November 2007 Investor Number of shares % of total Type Country BEAR STEARNS SECURITIES CORP. 1,217, % Nom. USA SUNDT AS 820, % Comp NOR BASS INVEST AS* 520, % Comp NOR FAIRBANKS JONATHAN B. 412, % Priv. USA DEUTSCHE BANK (SUISSE) S.A. 371, % Comp CHE GBR NOR NEXUS CAPITAL AS 270, % Comp NOR TITLIS AS** 266, % Comp NOR USA NORTHERN NAVIGATION INT.*** 266, % Comp LBR MORGAN STANLEY AND CO. INTL. PLC 258, % Comp GBR KLAVENESS INVEST AS 246, % Comp NOR MORGAN STANLEY & CO. INC. 220, % Nom. GBR GOLDMAN SACHS INT. - EQUITY - 204, % Nom. GBR CANICA AS 203, % Comp NOR ODIN OFFSHORE 201, % Comp NOR LEHMAN BROTHERS INTERNATL. EUROPE 177, % Nom. GBR GOLDMAN SACHS & CO - EQUITY 172, % Nom. USA ING.ONSRUD AS 111, % Comp NOR BANK OF NEW YORK, BRUSSELS BRANCH 107, % Comp GBR KREDIETBANK S.A. LUXEMBOURGEOISE 100, % Comp LUX R AND S FAIRBANKS IRREVOCABLE TR 88, % Comp USA Total number owned by top 20 6,234, % Board of Directors: Erland Bassøe, Chairman* Felix H. Tschudi** Jan R. Næss*** Tone Wille Gro Baade-Mathiesen 4 Total number of shares 7,567, %

5 Company management Substantial experience in founding & running world class oil service contractors Erland P. Bassøe (1957), Co-founder & Chairman 25 years offshore experience Seajacks, Floatel International, Scorpion Offshore, Frontier Drilling, ODS-Petrodata, Bassoe Offshore Georg Sverdrup Onsrud (1955), Co-founder & Chief Executive Officer 25 years offshore experience Fred. Olsen Production, Aker, Stolt, Kværner Christian Mowinckel (1954), Chief Financial Officer 27 years senior management experience in industry and offshore Ocean Rig, Kvaerner, Elkem, DnB NOR Kjetil Bruun-Olsen (1956), Vice President, Projects & Operations 12 years offshore, 12 years shipping experience Fred. Olsen, Star Refer, Neptun Leif O. Aaker (1951), Vice President, Business Development 30 years offshore experience Boa Offshore, Fred. Olsen Energy, Golar-Nor Offshore (Petrojarl) Ola Often (1956), Vice President, Technology 25 years offshore engineering Fred. Olsen, PGS, ABB 5

6 Company management Head office organisation (Nov 07) YELLOW = Employees BLUE = Consultants or employed abroad GREEN = Recruitment ongoing CEO G S Onsrud CFO C Mowinckel VP, Technology O Often Accounting Manager Office Manager Lead Engineer Process Lead Engineer DRB Controller Receptionist Lead Engineer EIT Compliance Manager (QA-HSE) HR Manager VP, Bus Dev L O Aaker VP Projects & Operations K Bruun-Olsen Sales & Marketing Personnel resources Projects Operations General Manager Rio Engineering Manager Project Manager DPP1 Operations Manager DPP 1 General Manager Houston Procurement Manager Project Manager DPP2 DPP2 Conversion Manager Site Manager Project Administration Technical Superintendent Marine Superintendent 6 Contracts Manager

7 Business plan Serving a surging demand for lease of floating production systems The FPSOcean vision is to become a significant niche player in the global market for floating production of oil & gas in the rapidly expanding deepwater development areas The FPSOcean business model is to build, own and operate Floating Production Systems, including conversion of crude oil tankers into Floating Production Storage & Offloading (FPSO) units FPSOcean is offering FPSO solutions for expedient development of deepwater reservoirs using cost effective Dynamic Positioning systems with safe, reliable and innovative technology The company has a goal of developing a fleet of 4-6 units over the next 4-6 years 7

8 FPSO market drivers Significant increase in deepwater drilling 8

9 FPSO market drivers Strong demand for FPSOs; downside is delayed dealflow 9

10 FPSO market drivers 70% of floating production spend to be in deepwater 10

11 FPSO market drivers Increased demand for deepwater field development High level of deepwater drilling activity High ratio of deepwater discoveries Deepwater production to follow the deepwater drilling surge Extended Well Test market rebounding Early Production market picking up Traditional mooring systems very expensive in deep water and for frequent redeployments Need for innovative solutions 11

12 Our response to the market drivers The Dynamic Positioning FPSO a versatile response to new requirements Dynamic Positioning (DP) systems have proved very favourable in subsea construction, drilling and shuttle tanker segments 20 years successful experience with Seillean DP FPSO in UK and Brazil DP FPSO requires ability to disconnect risers in case of DP failure/power black-out The same technology is valid for shut down and demobilisation in hurricane areas 12

13 Status of projects November

14 DeeP Producer 1 (DPP1) project status Dubai Drydocks: Four FPSO conversion ongoing; Olowi, DPP1, Frade, (Gimboa out of picture) 14

15 DPP1 project execution main contracts Power Module (Gas Turbines) Gas Turbines by Siemens, Sweden Electrical Distribution System by Siemens, Norway Power Module Design by Inocean Fabrication and Assembly by Lamprell Offloading System: Hawser Winch and Offloading Reel by Scana Offloading Hose by Trelleborg Disconnectable Riser Buoy (DRB): Engineering, Procurement and Construction (EPC) by Scana Structural parts sub-contracted to DDD and LEL Process Module: Engineering / Procurement Assistance by Expro/SPS Procurement by FPSOcean Fabrication by Lamprell Vessel Conversion: Structrual and Marine Systems Engineering by Inocean / Maritec Detailed Deck Arrangement by Icepronav EIT Engineering, Power Distribution and Control System by Siemens, Norway Procurement of equipment by FPSOcean Vessel Conversion by Dubai Drydocks Thrusters Thrusters by Schottel, Germany Thruster Drives by Siemens, Norway Thruster Control System by Kongsberg Maritime 15

16 DPP1 project organisation Site Team Dubai CONSTRUCTION MANAGER PROJECT CONTROL MANAGER Project Engineer Planner Current manning: LEL 5 People DDD 15 People ICE Eng. 2 People Quantity Surveyor LEL Quantity Surveyor DDD Logistics Coordinator Document Controller Project Site Secretary HSE Inspector SITE MANAGER LEL SITE MANAGER DDD MC/COMM. MANAGER Clerk/ doc controller Marine Superintendent Commissioning Team EI&T Lead Technical Superintendent EI&T Inspector Surface Treatment Jotun Struc/Piping/Mech Structural Inspector Surface Treatment Structural Inspector EI&T Lead 16 Mechanical/piping Lead

17 DPP1 status - ongoing activities at yard No accidents in 6 months, 1 minor injury First docking successfully completed 28th October, all planned activities done In general progress is good on all steel work activities and preparation for the next docking 28th December is satisfactory Demolition work will speed up as more work has been released Pipe works and cable trays have been delayed, but picking up as drawings are being released and prefabrication is progressing Preparation for port side deck reinforcement has started Prefabrication work is in progress for Helideck, Offloading Balcony, Flare Tower etc. and preparation work for Engine room, Aft Pump room & Main deck piping works are also in progress Painting of tanks are progressing well Refurbishment of Accommodation have started

18 DPP 1 status - structural work at yard Cut-out for Turret Thruster Room Construction 18

19 DPP1 status - structural work cont d Mating structure installation Thruster Blisters fabrication at Lamprell Mid-ship deck cut out 19

20 DPP1 status - topside fabrication at Lamprell M20 Process Module Pipe rack mounted and spools integrated Vessels for M20 received from GMMOS (excluding V1060) Vessels mounted and pipe work commenced Subcontracts for KO drum and V-7000 placed and construction commenced M80/M90 Power Module M80- Painting complete GT1 And 2 preparation for installation on M80 Construction of M90 first and second level commenced Accommodation Contract for Accommodation completed 20 Accommodation construction commenced

21 DPP1 status - modules at Lamprell Accommodation M20 Process Module M80/90 Power Module 21

22 DPP 1 status DRB fabrication at Lamprell Disconnectable Riser Buoy (DRB) 22

23 23 DeeP Producer 2 (DPP2) project status

24 DPP2 Outline Design Basis Double sided CAP1 rated Aframax built Japan 1988 DnV class notation 1A1 Ship Shaped Oil Production and Storage Unit, PROD, DYNPOS-AUTR Operational envelope > 6.0 meters significant wave height, ULS 10 meters significant Production capacity 90,000 bpd total fluid, 60,000 bopd API 15 to 40 Prepared for Water Injection and Gas Lift/Gas Injection Storage capacity: 600,000 barrels 2 off 17 MW Dual Fuel Gas Turbine Power generation 5 off 3.8 MW Azimuth thrusters Operating water depth 150 to 3000 meters Risers: 5 off 8 production or injection risers Up to 5 service lines Total riser weight capacity 250 t 24

25 DPP2 project status November 2007 Planning in good shape; awaiting contract DPP1 Semakau Spirit purchased for delivery July 2008 Yard slot secured with Dubai Drydocks for entry August Dual Fuel Gas Turbines purchased from Siemens for delivery August azimuth thrusters purchased from Schottel for delivery November 2008 Project definition, engineering and vendor bidding ongoing Dialogue with Oil companies, several prospects identified Preliminary budget USD 350 million USD 70 million committed USD 14 million expended 25

26 Finance funding in place DeeP Producer 1-88% funded; DeeP Producer 2 - initial equity raised DPP 1 construction funding total USD 210 mill (+ USD 5 mill) NOK 332 mill (approx. USD 57 mill) from equity issues (Feb, Jun, Dec 06) NOK 210 mill (approx. USD 33 mill) unsecured 2 year bond w/call option USD 75 mill 2 priority 5 year bond w/ call option USD 45 mill 1 priority bank construction loan (+ USD 5 mill post completion w/c) DPP 2 funding NOK 200 mill (approx. USD 33 mill) from equity issue (Dec 06) Total funding raised is approx. USD 248 mill Cash reserve at end of September (excluding undrawn bank loan) was approximately USD 90 million 26

27 Financials funding required Current funding adequate for ongoing activities / progress schedule DPP 1 funding Revised budget USD 239 mill (including contingency of USD 15 mill) NOK 165 mill (approx.usd 30 mill) funding shortfall to meet budget Start up and mobilization cost not included DPP 2 funding Total commitments to date approx. USD 70 mill Vessel, long lead items, front end engineering 27

28 Financials Q3 financial statements DPP1 and 2 project costs (incl. finance cost) capitalized in balance sheet Robust balance sheet with 43% cash and 40% equity ratio Consolidated profit & loss in USD Q3 Year to date Full year Income Administrative expenses Depreciation and writedown Cost of rent Other losses Other expenses Operating result Financial income Financial expenses Net financial expenses Profit before tax Income tax expenses Net result Notes: Q3 operating result include year to date share option expenses Financial income/expenses primarily agio/disagio Equity items grossed up for foreign exchanghe effects Interest bearing loans grossed up for call option values Consolidated balance sheet in USD Year to date 31. December ASSETS Non-current assets Property, plant and equipment Intangible assets Deferred taxes Current assets Trade and other accounts receivable Derivatives Cash and cash equivalents Total assets EQUITY Equity allocated the companies shareholders Issued capital Share premium Other reserves Retained earnings Result LIABILITIES Non-current liabilities Interest-bearing loans and borrowings Current liabilities Trade accounts and other payables Income tax payable 0 0 Loan Total liabilities Total Equity and Liabilities