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Microsoft PowerPoint - 090115_Taurex_Presentation

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					Oklahoma & Colombia
Presentation to Shareholders & Investors
January 2009

Disclaimer
This presentation and the information (the “Presentation”) which you are given at the time of presentation, in whatever form, does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in Taurex Resources plc (“Taurex”), nor shall it or any part of it form the basis of, or be relied upon in connection with, any contract or commitment whatsoever. The Presentation does not purport to contain all information that a prospective investor may require and it may be subject to updating, revision and further amendments. This document may contain certain forward-looking statements. These statements relate to future results, events or future performance and reflect management's expectations regarding Taurex’s growth, results of operations, performance and business prospects and opportunities. Such forwardlooking statements reflect management's current beliefs and are based on information currently available to management. A number of factors could cause actual events or results to differ materially from the results discussed in the forward-looking statements. In evaluating these statements, investors should specifically consider a number of various factors, which may cause actual results to differ materially from any forward-looking statement. These factors include, but are not limited to, market and general economic conditions; the nature of the oil and gas industry, including oil prices, imprecision of reserve estimates, drilling risks, future production of gas and oil, rates of inflation, changes in future costs and expenses related to the activities involving the exploration, development, production and transportation of oil and gas; hedging, financing availability and other risks related to financial activities; environmental and geopolitical risks; and the risks and uncertainties detailed from time to time in Taurex's interim and annual financial statements. These forward-looking statements are made as of the date of this document, and Taurex assumes no obligation to update or revise them to reflect new events or circumstances. Cliff West, Executive Vice President & Chief Operating Officer of Taurex (Member of the American Association of Petroleum Geologists – Certified Petroleum Geologist #1563), is the qualified person who has reviewed and approved the technical information in this presentation.

Presentation to Shareholders & Investors

January 2009

Slide 1

The Board (Non-Executive Directors)
Misbah Al Droubi
Non-Executive Director Chairman of BUIC Capital Management, a Kiev-based investment firm founded in 2007 specialising in foreign investment/development in Ukraine. Prior to founding BUIC, Misbah served as the Chief Executive Officer of Hares Group. Misbah also founded and developed The Medical Rehabilitation Centre in Egypt, was a founder and partner of Aviation Consultancy Services in Cyprus, and founded L’atelier D’amenagement de L’espace in Syria. Misbah joined the Taurex Board as Non-Executive Director in October 2005 as a result of Taurex’s acquisition of Rudis Drilling Company from the Hares Group.

Larry Schafran
Non-Executive Director Managing Director of Providence Capital Inc, a private New York based activist investment/advisory firm. Prior to joining Providence in mid-2003, Larry completed more than 3 years as Chairman, Interim-CEO and President of the Chicago-based Banyan Strategic Realty Trust. Served as a Director, Chairman and Trustee of a number of highly diverse public companies. Current public company directorships include SulphCo, Inc; RemoteMDx, Inc; National Patent Development Corporation and Tarragon Corporation. Larry is a “qualified financial expert” as defined by Sarbanes-Oxley.

Andrew Fentress
Non-Executive Director Managing Member of Medley Capital, LLC (“Medley”) and Senior Portfolio Manager for Medley Opportunity Fund. Prior to forming Medley, Andrew was a Partner at Columbus Nova, working as the Portfolio Manager of Columbus Nova Capital; the firm’s global investment fund. Prior to Columbus Nova, he was at CQ Partners as a Partner and Portfolio Manager for global investment. Andrew began his investment career with Morgan Stanley & Co, culminating in the role of Principal in the Institutional Equity Division, managing a global trading business.

David F. Phillips
Non-Executive Director Member of the Law Society of Alberta and a partner at McCarthy Tetrault LLP, Canada’s largest law firm, in the Calgary office. Served as a Director or corporate secretary of a number of other public companies. David has been a Director of Carpatsky since March 2000, and subsequently joined the Taurex Board in March 2004.

Presentation to Shareholders & Investors

January 2009

Slide 2

Management
Robert J. Bensh
Chairman & Chief Executive Officer Robert has been Chairman and Chief Executive Officer of Taurex (prior known as Cardinal Resources plc) since February 2004 and of Carpatsky Petroleum Inc. (“Carpatsky”) since December 2000. Previously, Robert was Executive Vice President and Chief Operating Officer at Carpatsky. Worked for Bellwether Exploration Company (now Mission Resources Corporation), Torch Energy Advisors Incorporated and Box Energy Corp. (Now Remington Oil&Gas Corp.). Robert is a graduate of Syracuse University with a BA/BS in Political Science and Economics.

Charles C. Green
Vice Chairman & Chief Financial Officer Charted Financial Analyst with MBA and BBA degrees from the University of Texas. Charles is a Founder and Joint Managing Director of Eurostructures Ltd. From 1997 to 2001, Charles was Executive Vice President – Head of Global Finance, Crown Castle International, an NYSE-listed wireless tower company. Prior to that, Charles served as President of Torch Energy Advisors Incorporated, and Executive Vice President and CFO of Bellwether Exploration Company, a Nasdaq-listed E&P company. Began his career at JP Morgan Investment Management.

Cliff West
Executive VP & Chief Operating Officer 40 years of experience - Expert in Development Geology & Geophysics and Project Management of Brownfield areas. From 1997 to 2001, Cliff was Senior Vice President for E&P for Bellwether Exploration Company. From 1984 to 1994, was an Exploration Consultant and then Vice President of Norcen Energy Resources Ltd (USA). Cliff graduated from the University of Southern Mississippi and holds MA in Geology from West Virginia University. Professional geologist, licensed by the State of Texas (#1418) and certified by the American Association of Petroleum Geologists (#1563).

Presentation to Shareholders & Investors

January 2009

Slide 3

Investment Thesis
Timely Opportunity in Emerging Play
Opportunity to capture upside in one of the most compelling development plays available in the market today, this package features the critical mass required to drive considerable cash flow growth and asset value appreciation.

Established Development Model
Combination of characteristics to create attractive economics (IRR):
– Modest D&C costs – High success rate (100% for Petroflow and other area operators) – High value production resulting in compelling IRR at $5-7/mcf gas with upside in strong gas price environments

Market Validated Strategy
Comparable company performance (Petroflow) validates potential for reserve and cash flow growth rates contemplated.

Significant Near Term Value
The work program is underway with completion of Phase 1 expected by early 2009. This will facilitate booking of 6-8 PUD locations per Phase 1 well resulting in 12 PDP locations, 72-96 PUD locations with many additional probable locations.

Presentation to Shareholders & Investors

January 2009

Slide 4

Play to Drive Shareholder Returns
Taurex Resources plc (“Taurex”) through its 55% owned subsidiary, Condor Exploration, Inc., has assembled two projects totalling over 60,000 gross acres in the Hunton de-watering play in central and northern Oklahoma (“Hunton”). These projects provide Taurex a ground floor opportunity to provide investors exposure to a potentially value creating oil and gas exploitation project. The Hunton de-watering play has demonstrated its ability to drive shareholder returns through the performance of Petroflow Energy
– a Canadian independent which derives over 90% of its production and reserves from the Hunton formation.

Presentation to Shareholders & Investors

January 2009

Slide 5

Oklahoma Hunton Formation – Asset Locations

Simplicity Prospect
Oklahoma City

North Fork Project

Presentation to Shareholders & Investors

January 2009

Slide 6

Oklahoma Hunton Formation – Project Scalability

Presentation to Shareholders & Investors

January 2009

Slide 7

Hunton De-Watering Play Characteristics
Shallow wells (from 4,500 feet) with modest drilling and completion costs of $2.5-3MM per well. High success rates (Petroflow Energy, Ltd. has completed 46 consecutive successful wells). Predictable operating results (2.3 Bcf average per well and a peak flow rate of 1.1 Mcf/d). High value production - high content of natural gas liquids per Mcf of dry gas (approximately 7 gallons per Mcf of wet gas with each gallon of NGL yielding approximately $1.80 per gallon – on a blended basis). Strong net operating cash flow/mcf of $9.60 at $7.00/mcf NYMEX natural gas due to premium from NGL content which results in premium price of $12.75+ per Mcf of production at $7.00 gas. The Hunton de-watering play is developed through the use of salt water disposal wells to dispose of a large amount of initial water produced from the formation as well as dual and, in some cases, triple lateral horizontal drilling. Large data base of well logs and production data for the Hunton formation validates presence of hydrocarbons and reduces the geologic risk. The play is similar to a mining operation with a demonstrated resource in place coupled with a large scale water disposal and horizontal drilling technology to profitably exploit. These variables combine to provide a low risk, high return investment opportunity for Taurex shareholders.

Presentation to Shareholders & Investors

January 2009

Slide 8

Hunton: Basic Formation Concept
Resource Characteristics
Shallow Depth: 4,500ft to 6,500ft Extensive Oil Transition Zone High Solution Gas Content

Keys to Development
Horizontal Drilling Extensive & Rapid De-Watering Process Increasing Gas Rates

Presentation to Shareholders & Investors

January 2009

Slide 9

Hunton: Typical Well Economics
Well Parameters Depth (ft) Gross Cost per Well¹ Gross Historical Reserves per Well Peak Production Rate De-Watering Rate
1. Includes allocation of infrastructure costs

Cost Structure 4,500 to 6,500 US$2.6 million 2.3 Bcfe 1100 Mcfe/d 3 to 12 months Average Lease Operating Expense-LOE (3yr) $1.00/Mcfe

Wellhead Differentials Natural Gas + NGL adjustment Oil WTI - $0.39 86.5% of NYMEX

Project Returns
80% 70% 60% 50% 40% 30% 20% 10% 0% $4.00 $5.00 $6.00 $7.00 $8.00 $9.00 $10.00

Presentation to Shareholders & Investors

January 2009

Slide 10

North Fork Project & Simplicity Prospect
North Fork is a 50,000+ acre Hunton de-watering play in central Oklahoma. The objective of the North Fork programme is to prove 60 PrUD locations. North Fork Project work programme:
Drilling 8 initial wells Drilling associated salt water disposal wells Installation of gas infrastructure

Cardinal Hunton has committed to a 60% interest in the project and paid US$12 million of the leasehold cost
The drilling programme on North Fork is ready to commence immediately

Simplicity is a 10,000+ acre Hunton de-watering play directly to the West of North Fork. The objective of the Simplicity programme is to prove 24 PrUD locations. Simplicity Prospect work programme:
Drilling 4 initial wells Drilling associated salt water disposal wells Installation of gas infrastructure

Cardinal Hunton has committed to a 50% interest in the project; approximately 50% of the targeted acreage has been acquired with lease acquisition continuing
Taurex believes that aggressive exploitation of the forced pooling rules in Oklahoma can add materially to the project

Presentation to Shareholders & Investors

January 2009

Slide 11

Orion Exploration LLC
Orion is the operator of the projects and is a local "prospect generator" with a highly experienced technical team and proven track record of executing and operating similar projects in the region. Orion, founded in 2001, is a privately held, independent oil & gas company headquartered in Tulsa, Oklahoma. Orion maintains its own geological, engineering, operations, and land staff. Their team has more than 100 years collective experience in the oil & gas industry.

Presentation to Shareholders & Investors

January 2009

Slide 12

Colombian Asset Locations

Toca

Quebrada Roja

Canaguaro
Bogotá

Presentation to Shareholders & Investors

January 2009

Slide 13

Colombian Asset Overview

Taurex has three projects in the Republic of Colombia: two workovers and one exploratory project.

Toca Field
The workover in the Toca Field (Middle Magdalena Basin) has been completed, in which Taurex has a 28.98% NRI (BPO) and 18.93% NRI (APO). A pump has been installed on the well, averaging approximately 65 bopd during the first week of January 2009, 19 bopd net to Taurex.

Quebrada Roja Field
The workover in the Quebrada Roja Field (Middle Magdalena Basin) is in progress, in which Taurex has a 31.74% NRI (BPO) and 20.74% NRI (APO). Following completion, a pump will be installed to enhance production from the well.

Canaguaro Field
Exploratory project at the Canaguaro Field (Llanos Basin) is in progress, in which Taurex currently has 100% WI, 78.20% NRI (BPO) and 76.36% NRI (APO). A 3-D seismic survey has been completed. The Company is currently in the process of working with the ANH on the phase 3 development program for the Canaguaro field which will consist of a new well or side-track to an existing well that tested oil on a re-entry in July 2007 and January 2008. The Company intends to seek a partner to farm-in to the Canaguaro Field.

Presentation to Shareholders & Investors

January 2009

Slide 14

Shareholding Structure
Shareholder Petronaft Energy* Candor Advisors QVT Fund Ospraie Torch Energy Providence Directors Others Total Shares Outstanding Options Warrants TOTAL FULLY DILLUTED
*Previously Hares Group Energy.

Shares 31,949,364 28,000,000 20,395,000 10,474,302 3,698,860 3,480,000 3,306,944 51,249,639 152,554,109 10,140,000 17,527,975 180,222,083

% 20.94% 18.35% 13.37% 6.87% 2.42% 2.28% 2.17% 33.59% 84.6% 5.6% 9.7% 100%
Directors 3,306,944 2.17% Providence 3,480,000 2.28% Torch Energy 3,698,860 2.42% Others 51,249,639 33.59% Petronaft Energy* 31,949,364 20.94%

Candor Advisers 28,000,000 18.35%

Ospraie 10,474,302 6.87%

QVT Fund 20,395,000 13.37%

Presentation to Shareholders & Investors

January 2009

Slide 15

For further information
Visit www.taurex.co.uk, or contact
Charles Green
– Chief Financial Officer – Direct Line: +44 (0) 20 7960 6571 – Email: cgreen@taurex.co.uk

Natalia Egorova
– Director of Corporate Communications – Direct Line: +44 (0) 20 7960 6575 – Email: negorova@taurex.co.uk

Registered Office & Head Office of Taurex Resources plc
– Taurex Resources plc 10 Greycoat Place London SW1P 1SB – Telephone: + 44 (0) 20 7960 6031 – Fax: + 44 (0) 20 7960 6120 – Email: info@taurex.co.uk

Taurex Resources plc is registered in England and Wales: 5049975

Presentation to Shareholders & Investors

January 2009

Slide 16


				
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