PILOT SHARE FAIR AECC: Wednesday 4 November 2015
SECTION HEADING PILOT Share Fair - 4 November 2015 2
AGENDA Total and our strategy Today s challenges Development programme Doing business with Total Q&A LEGAL NOTICE This presentation represents the current view of future activities for TOTAL E&P UK Limited. Some activities remain subject to further study and / or internal and partner approval. PILOT Share Fair - 4 November 2015 3
TOTAL AND OUR STRATEGY
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SAFETY: OUR PARAMOUNT VALUE 4Sight The Deal Golden Rules A Just and Fair Culture Building a culture of safety through leadership, openness, communication and transparency PILOT Share Fair - 4 November 2015 6
TOTAL E&P UK LIMITED (TEP UK) TOTAL AND OUR STRATEGY
TOTAL E&P UK LTD One of the largest operators in the UK in terms of production and reserves Employing around 1,000 people (staff and contractors) 2014 SEC production of 89,000boepd Current proven and probable reserves of 539Mboe Contributed 4% of the Total Group s daily production in 2014 2014 operated budget of 2.35 billion Expected expenditure of 6 billion over the next five years PILOT Share Fair - 4 November 2015 8
GREATER LAGGAN HUB 60% TEP UK (operator) 125km northwest of Shetland Production potential 90,000 boepd Gas condensate: Laggan/Tormore Edradour/Glenlivet Challenges: Deep water Harsh environment PILOT Share Fair - 4 November 2015 9
CENTRAL GRABEN HUB 46.17% TEP UK (operator) 240km east of Aberdeen Current production 115,000 boepd Oil and Gas: Elgin/Franklin West Franklin Glenelg Challenges: HP/HT PILOT Share Fair - 4 November 2015 10
NORTHERN NORTH SEA HUB 100% TEP UK (operator) 440km northeast of Aberdeen Current production 55,000 boepd Oil and Gas: Alywn North Dunbar Ellon/Grant Forvie/Jura Islay Nuggets Challenges: Mature reservoirs PILOT Share Fair - 4 November 2015 11
TODAY S CHALLENGES
OIL & GAS UK ECONOMIC REPORT HIGHLIGHTS PILOT Share Fair - 4 November 2015 13
EFFICIENCY CHALLENGE: INCREASED OPERATING COSTS Address PILOT Share Fair - 4 November 2015 14
TEP UK CULTURE: COMPETE ON COST AND DELIVER Ambition Deliverable Compete on Costs Sustainably reduce our costs (not a one shot approach) Continuous challenge on cost (agree opportunities with suppliers) SUSTAINABLE COST REDUCTIONS TEP UK is collaborating with its suppliers to significantly reduce OPEX and CAPEX costs. The key objective is to: Structurally and sustainably reduce costs, without ever compromising the safety or integrity of company s operations PILOT Share Fair - 4 November 2015 15
TEP UK CULTURE: LEAN PRINCIPLES Address PILOT Share Fair - 4 November 2015 16
LEAN: SAVINGS ON NNS SINCE APRIL 2015 Battles Achievements Visual Management Visual Scheduling Field Tour Root Cause Measurement Alwyn: ~26% improvement in productivity of maintenance core crew Dunbar: ~39% improvement in productivity of maintenance core crew. Parts ordering and stock management New process in place to return direct purchase items into onshore stock mgmt 300 items being returned onshore for a total value of ~ 250k No longer a culture of storing black stock on site Preventative Maintenance (PM) frequency Systematic review of PMs being executed Reduction of 15,000 hours in SAP to date Vendors scopes ongoing review has saved ~ 100K per year to date Preventative Maintenance grouping 170 hours reduced plus non measureable hours in connection with linked disciplines 7500 BOE/year to be realised from grouping online/offline maintenance of CGL compressor. (~ 300K) Choose, Focus and Act with a LEAN perspective resulted in actual savings of 1.25M in 5 months and improved efficiency of work by >25% PILOT Share Fair - 4 November 2015 17
TEP UK CULTURE: TECHNOLOGY PRIORITIES Intelligent Operations & Maintenance Robotics Wireless monitoring technology ASSET INTEGRITY / SMART ROOM / BIG DATA Subsurface Imaging Improve acquisition and processing techniques Improve sub-volcanic (basalt) imaging for new West of Shetland exploration plays Accurately visualise individual thin sand units Effective Drilling & Completion Low cost drilling / increasing productivity Alternative technologies for tight sands (lower cost and increased productivity) Small Pool Development Long distance subsea tie-backs Subsea remote chemical storage and injection Remote power generation and umbilical-less subsea systems Onshore Shale Gas (East Midlands) Gainsborough Trough Area Future Onshore Licencing Rounds Decommissioning Development of technologies to reduce costs and improve safety Well plug & abandonment ACTIVELY WORKING WITH STAKEHOLDERS PILOT Share Fair - 4 November 2015 18
DEVELOPMENT PROGRAMME
GREATER LAGGAN: FUTURE DEVELOPMENT OPPORTUNITIES Edradour / Glenlivet project ongoing Tobermory discovery (1600m WD, 175km from Shetland Gas Plant) long distance subsea tie-back 26 th, 27 th and 28 th Licensing Rounds acreage exploration upside PILOT Share Fair 4 November 2015 20
CENTRAL GRABEN: FUTURE DEVELOPMENT OPPORTUNITIES Elgin Franklin redevelopment project ongoing to secure wells and complete infill drilling to maximise recovery of existing reserves Infill drilling on new West Franklin wellhead platform 4 Heavy Duty Jack up rigs in parallel in 2016 Restart of Glenelg well planned with continuous downhole zinc and lead sulphide scale inhibitor injection PILOT Share Fair 4 November 2015 21
NORTHERN NORTH SEA: FUTURE DEVELOPMENT OPPORTUNITIES Continuous infill drilling on Alwyn and Dunbar supported by seismic reprocessing, extended reach drilling technology and well activation Mature assets that require continual ongoing maintenance programme to optimise operating costs and maintain production / maximise ultimate reserves recovery Further OPEX reduction studies Alwyn Dunbar Field Life Extension studies and End of Life studies ongoing 28 th Licensing Round acreage exploration upside PILOT Share Fair 4 November 2015 22
FUTURE OPPORTUNITIES (1/3) SERVICE 23 STRATEGY REVIEW DATE PRIMARY CONTACT CATEGORY Ad-Hoc Rotating Equipment Services Ad-hoc Pump Maintenance Services Q4 2015 Q4 2015 Jeremy Robertson Jeremy Robertson Fiscal Metering Services Q4 2015 Craig Thomson Valve Maintenance, Repair & Associated Services Q2 2016 Craig Thomson Inspection Management Services Q3 2016 Craig Thomson Inspection Services Q3 2016 Craig Thomson Operations, Maintenance & Subsea Operations, Maintenance & Subsea Operations, Maintenance & Subsea Operations, Maintenance & Subsea Operations, Maintenance & Subsea Operations, Maintenance & Subsea PILOT Share Fair 4 November 2015 23
FUTURE OPPORTUNITIES (2/3) SERVICE 24 STRATEGY REVIEW DATE PRIMARY CONTACT CATEGORY DD/MWD/LWD Q4 2015 Julie McWilliam Well services HP/HT & Standard Pipe Recovery Services Q4 2015 Julie McWilliam Well services Drilling Fluids Q4 2015 Lora Halliday Well services Casing & Tubular Running Services Q1 2016 Julie McWilliam Well services Well Testing Services Q1 2016 Lora Halliday Well services Coiled Tubing Q1 2016 Martin Glennie Well services Wellhead Services Q1 2016 Martin Glennie Well services Seismic Data Processing Q2 2016 Pascaline Heckle Well services Drill Pipe Services Q4 2016 Julie McWilliam Well services PILOT Share Fair 4 November 2015 24
FUTURE OPPORTUNITIES (3/3) SERVICE STRATEGY REVIEW DATE CONTRACTS ENGINEER CATEGORY Elgin / franklin 2016 3D/4D acquisition OBN Dunbar acquisition (contingent) Q4 2015 Pascaline Heckle Seismic 2016 Pascaline Heckle Seismic Tormore 2D / 4D baseline 2016 Pascaline Heckle Seismic EOSPS East of Shetland Pipeline System Support and Maintenance of LAN Equipment Q4 2015 Craig Soppit Projects Q4 2015 Shona Wildi Corporate Affairs Supply of Gaskets (eauction) Q1 2016 Craig Steven All operational sites Supply of Stud bolts and Fasteners (eauction) Q1 2016 Alister Armstrong Craig Steven All operational sites PILOT Share Fair 4 November 2015 25
DOING BUSINESS WITH TOTAL
SUPPLY CHAIN FACTS AND FIGURES 1.5bn spend to date in 2015 500 live contracts committed to payment within 30 days of receipt 8000 orders created in 2015 50 live frame agreements for procurement 60 FPAL assessments completed in 2015 PILOT Share Fair 4 November 2015 27
OUR SUPPLY CHAIN VALUES Our contracts and procurement department is committed to: Safety, Health and Environment (SHE) Make no compromise on Safety, Health and Environment All business must be compliant to our HSE policy Cost Sustainable cost for all our commitment Innovation to improve our cost efficiency Operational excellence and efficiency in contracts and procurement process Supplier Relationship Management Collaborative, work and discussion with our key suppliers Equal treatment of all suppliers Respect of contractual commitments Ethical conduct Alignment with our code of conduct for suppliers and subcontractors Avoidance of corruption PILOT Share Fair 4 November 2015 28
DOING BUSINESS WITH TOTAL TEP UK Total E&P UK compliant with the Supply Chain Code of Practice (SCCoP) Award of Excellence retained FPAL used for sourcing, performance management and pre-qualification in tenders: Advanced registration to FPAL of all our suppliers Up-to-date registration records from suppliers FPAL Capability Profile is required for key contracts / ITTs VERIFY scheme, assessing suppliers HSE practices Aiming to avoid duplication of information already supplied to FPAL Suppliers should commit to conducting two way FPAL performance feedback Promoting use of VERIFY scheme, assessing suppliers HSE practices All supplier are expected to comply to the principles of the SCCoP Total Group International Supplier Database for contracts and purchasing International visibility within Total group supply chain Suppliers must satisfy Total s prequalification, due diligence and HSE requirements PILOT Share Fair 4 November 2015 29
FORWARD WORK PLANS A web-based information-sharing website to provide up to date information on business opportunities for the Supply Chain. Visit the FPAL website to see our information online http://www.fpal.com/ and/or collect a printout on your way out Benefits of the work plans: Help provide an indication of future activity by participating Purchasers Act as a planning aid to help facilitate potential business opportunities for the supply chain. Support the Supply Chain Code of Practice in communicating opportunities to the supply chain. Please note that Forward Work Plans are indicative and subject to change PILOT Share Fair 4 November 2015 30
KEY CONTACTS BROCHURE PILOT Share Fair 4 November 2015 31
Q&A