Empresa Nacional del Petróleo 1Q 2012 Financial Results

Transcription

1 Empresa Nacional del Petróleo 1Q 2012 Financial Results June 2012

2 Disclaimer Forward-looking statements are based on the beliefs and assumptions of ENAP s management and on information currently available to the Company. They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of ENAP and could cause results to differ materially from those expressed in such forward-looking statements This presentation contains certain performance measures that do not represent Chilean GAAP and IFRS definitions, such as EBITDA and Net financial debt. These measures cannot be compared with the same previously used by ENAP and the same used by other companies Investors Presentation 2

3 Highlights 100% State owned, the second largest Chilean state-owned company 2011 Revenues and EBITDA of USD10,835 MM and USD 372 MM, respectively 1Q 2012 Revenues and EBITDA of USD 2,866 MM and USD -15 MM, respectively A key strategic asset for Chile The only refiner in Chile Represents approximately 40% of Chile s energy matrix Satisfies approximately 66% of Chilean demand for refined oil products World class operator with state of the art facilities and an extensive logistics network in Chile 3 refineries, marine terminals, storage facilities for crude and refined products, pipelines, and the region s first LNG terminal Stable & long-term relationships with a diverse base of suppliers & buyers Proven access to multiple sources of financing Experienced and professional management Strong investment grade ratings since 2002 (Baa1/BBB-/A) Investors Presentation 3

4 Agenda Section 1 Business Strategy Section 2 ENAP at-a-glance Section 3 Company Overview Section 4 Financial Performance Investors Presentation 4

5 Business Strategy Maintain leadership position in the growing Chilean market Continue offering a variety of refined and natural gas products at competitive prices Improve complexity of refineries and focus on providing higher value-added products Improve operating efficiency and profitability Shorten the inventory cycle and implement a more flexible hedging strategy Improve cost structure and energy independence from South America Expand international exploration and production operations, primarily in South America and Northern Africa Focus on E&P opportunities in markets with already established presence such as Egypt, Ecuador and Argentina Achieve a greater level of integration by expanding refining, logistics and distribution capabilities in the region Investors Presentation 5

6 Agenda Section 1 Business Strategy Section 2 ENAP at-a-glance Section 3 Company Overview Section 4 Financial Performance Investors Presentation 6

7 Chile s Only Oil Refiner, 100% Government-Owned ENAP represents a key strategic asset for Chile as the largest and most significant oil producer, the only refiner in Chile, and the Chilean market leader in the refined oil products market Represents approximately 40% of Chile s energy supply for transportation and power generation Satisfies approximately 66% of Chilean demand of refined oil products 100% State owned, Chile s second largest state-owned company World class operator with an extensive network for transportation, storage and distribution of crude oil, natural gas and refined products in Chile 3 refineries with a total aggregate refining capacity of 229,000 bb/day, an unmatched asset base Stable and long-term relationships with suppliers and buyers One of the highest rated oil and gas company in Latin America, with strong access to capital markets: Baa1 (Stable) / BBB- (Positive) / A (Stable) (Moody s/s&p/fitch) Investors Presentation 7

8 Strong Support from The Republic of Chile Government ownership with strong support as evidenced by: US$250 mm capital contribution in 2008 Capitalization of retained earnings at the ENAP subsidiary level Temporary suspension of dividends to the Republic of Chile The government has waived its right to receive any dividends for the past three years, allowing ENAP to strengthen its capital base Relationship with the owner Strong corporate governance, following best practices from the private sector Chilean government and its regulatory bodies closely supervise operations The Chairman of the Board is the Minister of Energy Budget and debt issuance approved by the Ministry of Finance Professional and experienced management team Investors Presentation 8

9 Agenda Section 1 Business Strategy Section 2 ENAP at-a-glance Section 3 Company Overview Section 4 Financial Performance Investors Presentation 9

10 Two Distinct Businesses: Downstream & Upstream ENAP organizes its operations into two divisions: Refining and Marketing ( R&M ) for downstream activities Exploration and Production ( E&P ) for upstream activities R&M and E&P historically have accounted for approximately 95% and 5% of revenues and approximately 60% and 40% of the net profit, respectively Downstream Upstream Refining and Marketing Refining (R&M) and Marketing (R&M) Exploration and Production Exploration (E&P) and Production (E&P) International Domestic Magallanes R&L Magallanes R&L Magallanes E&P Magallanes E&P Source: ENAP Investors Presentation 10

11 Extensive Refining and Logistics Assets Leadership position based on refining capacity and extensive oil and gas network in Chile which delivers natural gas and refined products to key energy centers Unmatched asset base which is critically important to Chile Three refineries located in central and southern Chile (Aconcagua, Bío Bío and Gregorio) which in 2011 produced an average of thousand barrels of refined products per day, including a wide range of products. During 1Q2012 ENAP s refineries has produced an average of thousand barrels of refined products per day Crude oil storage facilities with an aggregate storage capacity of approximately one million cubic meters Refined products storage facilities with a total capacity of approximately 1.5 million cubic meters Marine terminals next to the Aconcagua and Bío Bío refineries, with sufficient capacity to receive 100% of the refineries crude oil and imported refined product requirements Gas pipelines in the Magallanes region which connect Tierra del Fuego island with the continent and which connect our facilities to our industrial customers Pipelines in Magallanes connecting crude oil producing wells with the Gregorio refinery and the marine terminal 1 Concón: Refinery Aconcagua Santiago: ENAP Headquarters 2 Linares: Terminal Hualpén: Refinery Bío Bío Refinery Locations ENAP s Refining Capacity 46.7% 47.0% Santiago: ENAP Sipetrol S.A. (HQ) Maipú: Terminal San Fernando: Terminal Chillán: station 3 Punta Arenas: Refinery Gregorio 6.3% Aconcagua Bío Bío Gregorio Investors Presentation 11

12 Advanced & Flexible Refining Capacity Highlights ENAP s refineries process crude oil, substantially all of which is purchased from foreign third parties ENAP has improved its refineries capacity for refining heavy crude oils Heavy crude oils are less expensive than light crude oils and are abundant in South America, shortening ENAP s inventory cycle 100% 75% Use Rate 50% 25% ENAP s Refining Utilization Rate (%) 94,9% 87,7% 89,1% 83,7% 76,4% 69,4% 71,1% The utilization rate, as of March 31, 2012, reached 71.1% Given refining margins in the current market, ENAP is making better use of its refineries 40 0% Q2012 International Refining Margins (Dated Brent) Despite oil price volatility, several factors have helped ENAP s efficiency and operations: Advanced and capable refineries 10 Import parity pricing mechanism 0 Dominant market share in Chile -10 ene-11 abr-11 jul-11 sep-11 dic-11 mar-12 High-value and quality products Crack ULSD USGC(US$/bbl) Crack Unl87 USGC (US$/bbl) Crack F.O N 6 3% S. USGC (US$/bbl) Investor Presentation 12 Source: ENAP

13 Energy Cost Brent US$/MMBtu Power Marginal Cost US$/MWh ,9 20,5 19, ,4 204,6 181,0 190,9 US$/MMBtu ,9 4,2 4,3 5,0 6,6 9,4 12,5 11,3 13,8 10, US$/Bbl ,2 47,5 45,9 104,7 136, , Q Q2012 Brent (US$/MMBtu) Quillota Gross Heating Value, MMBtu/Bbl : 5.77 Investor Presentation 13

14 Increase in Crude Oil Cost due to WTI/Brent Spread in Spread vs Brent (US$/Bbl) Jan-Sep 2011 Oct-Dec 2011 Increase in cost Marlim -12,3-6,6 +5,7 Vasconia -4,8-3,1 +1,7 Oriente -11,7-5,7 +6,0 Jan-Mar 2011 Jan-Mar 2012 Increase in cost -12,8-9,0 +3,8-4,8-3,9 +0,9-11,6-6,9 +4,7 Source: Platts Investor Presentation 14

15 Undisputed Leadership in Refined Products Crude Oil Volume Processed Refined Products Production Mm Light Medium Heavy Other gross inputs mar-11 mar Mm mar-11 mar Diesel Gasoline LPG Fuel Oil Kerosene Others Market Share 1Q2012 in Chile 95,68% Mar-11 Mar-12 62,14% 53,22% 81,99% 68,03% 63,94% 75,70% 75,33% 70,89% 64,85% 75,15% 58,43% 68,83% 66,58% Diesel Gasoline LPG Fuel Oil Kerosene Other Average Source: ENAP Investor Presentation 15

16 Comprehensive downstream chain with a diverse base of clients and products Volume Sold by Clients Terpel 14% Shell 16% Others 10% Petrobras 18% Sales Breakdown Copec 42% Refining Capacity Aconcagua (46.7%) Bío Bío (47.0%) Gregorio (6.3%) Refined Products Crude oil Kerosene Natural Gas Diesel LPG Fuel oil Gasoline Petrochemicals Chevron 21% Crude Oil Suppliers Others 13% Taurus 22% Petrobras 7% Glencore 3% Shell 7% Occidental 6% Ecopetrol 9% Petrochina 14% Crude Oil Supply by Country GLP 9% Fuel Oil 10% Kerosene 6% Natural Gas 3% Others 3% Diesel 42% Storage Facilities Refineries & Distribution Companies End User Direct Products Copec, Shell, Petrobras, Terpel Argentina 2% Colombia 18% Peru 12% Brazil 29% Source: ENAP Gasoline 29% Ecuador 39% Investor Presentation 16

17 Pioneer in Diversifying the Chile s Energy Matrix First LNG Regasification Plant in the Region ENAP built a critical asset to continue playing its strategic role in Chile s economy, partnering with British Gas, Metrogas and Endesa, ENAP built the first liquefied natural gas ( LNG ) storage and re-gasification plant in Latin America The plant, located in south-central Chile, has an average LNG regasification capacity of 10 mm m 3 / day The GNL Quintero plant has provided ENAP with A safe and dependable source of natural gas, allowing procurement from different origins from where energy can be shipped, and reduced the need for significant diesel imports A more cost effective and stable supply of fuel to power its refineries The project started its commissioning stage in July 2009 and completed the early gas phase in September 2009 The plant became fully operational in January 2011 In June 2011 the Virtual Gas Pipeline that takes LNG by trucks from GNLQ s Truck Loading Facility from the V Region to the VIII Region began operating, allowing the Bío Bío Refinery to operate with natural gas again. Source: ENAP Investors Presentation 17

18 Select Base of E&P Assets Focused on ENAP s Areas of Expertise and Furthering Regional Integration ENAP s E&P operations have allowed the Company to develop expertise in the field and deepen relationships with E&P partners and crude oil suppliers ENAP s main goal for its E&P operations is to increase the quantity of its oil and gas reserves both in Chile and abroad The Company s operations are focused on Latin America & North Africa with fields in Chile, Argentina, Ecuador and Egypt producing crude oil and natural gas ENAP also actively manages its E&P portfolio through sales and acquisitions In March 2009, the Company sold its 50% stake in Egypt s North Bahariya block for a profit of USD 45.7 MM From the renegotiation of tariffs required under the new contract in Ecuador, ENAP obtained a net block called Intracampos to carry out exploration work between the PBH and MDC blocks located in Ecuador s eastern basin In 2011, 3 new discoveries were put into production in Egypt with average daily production of 4,300 barrels per day In 2011, ENAP Sipetrol, through SIPEC, signs an exploration agreement for Block 3 Jambelí in Ecuador, this will allow the exploration of km2 in the Guayaquil Gulf with an investment of USD 43 MM. In May 2012, ENAP Sipetrol agrees an exploration and production service agreement for a block in Egypt. This block named Sudr Block has an exploration area of 63 km2. Ecuador (Branch) (1) PBH (100%) MDC (100%) Chile (Headquarters) Magallanes Chile (100%) (1) Service contracts Egypt (Branch) East Ras Qattara (50%) Rommana (40%) Sidi Abd El Rahman (30%)* Argentina (Subsidiary) Area Magallanes (50%) CAM 2/A Sur (50%) E2 (33%) * Camp. Central (50%) * Pampa del Castillo (100%) (%) Ownership * Blocks where ENAP is not an operator Proved Oil & Gas Reserves Ecuador 12% Argentina 26% Egypt 7% Chile 55% Mar-12: 127,11 mm boe (2) Investors Presentation 18 (2) Developed and Undeveloped reserves

19 Exploration & Production Performance Until the 1980s, the production of crude in Magallanes, Chile represented approximately 50% of the crude required by ENAP s refineries. Currently approximately 2% of the crude oil produced in Magallanes is used by ENAP s refineries. The natural gas produced in Magallanes is the main source of the power generation and heating system used for the city of Punta Arenas, and currently supplies one train of ethanol production. In 1991, ENAP created an international affiliate, Sipetrol, to explore and produce crude oil and natural gas internationally. The total production of crude oil from our E&P division currently represents approximately a 10% of the crude oil required by the refineries, though the crude is not actually used in the refineries. Oil Production (thousand barrels per day) Gas Production (thousand boe per day) 35,0 30,0 25,0 20,0 15,0 10,0 30,7 2,6 1,0 16,8 32,4 2,6 1,5 16,9 30,5 2,6 2,1 14,9 29,4 2,5 3,4 13,6 27,6 2,3 3,9 12,5 33,2 2,1 6,9 14,1 40,0 35,0 30,0 25,0 20,0 15,0 10,0 33,6 34,5 31,5 29,5 25,5 32,4 26,8 22,0 19,4 19,7 17,0 14,6 5,0-10,3 11,3 11,0 9,9 8,9 10, Q 5,0-1,1 5,0 6,0 4,8 2,5 5, Q Argentina Ecuador Egypt Chile Argentina Chile Source: ENAP Investors Presentation 19

20 Agenda Section 1 Business Strategy Section 2 Company Overview Section 3 ENAP at-a-glance Section 4 Financial Performance Investors Presentation 20

21 Consolidated Financial Highlights Q2012 ENAP Financial Summary US$ MM FY2008 FY2009 FY2010 FY2011 1Q2012 Revenues 12,183 7,098 8, Cost of Sales (12,927) (6,835) (7,933) (10.663) (2.936) Gross margin (744) (69) EBITDA (641) (15) EBITDA Margin -6,0% 7.7% 4.9% 3,4% -0,5% Net Profit (956) (69) (111) Net Financial Debt / EBITDA (LTM) NA 5.3x 8.1x 9,85x NA EBITDA / Financial Expense NA 3.2x 2.2x 2,12x NA Net Financial Debt / Total Equity 11.6x 6.5x 7.2x 9,63x 14,17x IFRS US$ MM FY2008 FY2009 FY2010 FY2011 1Q2012 Cash and Equivalents Current Assets 2,203 2,231 2, Properties Plant & Equipment Net 2,463 2,598 2, Total Assets 5,318 5,560 5, Current Liabilities 2,875 2,151 1, Long-Term Liabilities 2,246 2,965 3, Net Financial Debt 2,271 2,891 3, Total Liabilities 5,121 5,116 5, Total Equity Investors Presentation 21

22 Financial Summary Capital Expenditure (USD MM) Equity (USD MM) $381 $320 $264 $ Q 2012 $444 $456 $381 $ Q 2012 Total Financial Debt (USD MM) $2.968 $3.348 $3.951 $ Q 2012 Source: ENAP and Bloomberg (for historical crude prices) Investors Presentation 22

23 Financial Summary Consolidated Quarterly EBITDA Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 Consolidated Last Twelve Months EBITDA Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 Investors Presentation 23

24 Debt Profile as of March 31, 2012 Financial Debt and Supplier Credit US$ Millions Supplier s Credit Financial Debt (Banks and Bonds) Dic-09 Dec-10 Dec-11 Mar-12 Investors Presentation 24

25 Debt Maturity Profile as of March 31, 2012 Net Debt Maturity Profile as of March 31, 2012 US$ millions 1.000,0 900,0 800,0 LT Bank Debt Local Bonds SPVs ST Bank Debt, Net International Bonds 41,4 700,0 600,0 21,8 300,0 US$MM 500,0 290,0 44,0-400,0 300,0 200,0 100,0-43,7 150,2 44,2 42,1 500,0 500,0 461,3 150,0 136,0 293,9 223,9 123,9 70,3 45,9 39,8 23,9 23,9 39,2 7,2 7,2-7,2-3, The weighted average life of ENAP s Net Debt is 5,7 years Investors Presentation 25

26 Highlights 100% State owned, the second largest Chilean state-owned company 2011 Revenues and EBITDA of US$10,835 mm and US$372 mm, respectively 1Q 2012 Revenues and EBITDA of USD 2,866 MM and USD -15 MM, respectively A key strategic asset for Chile The only refiner in Chile Represents approximately 40% of Chile s energy matrix Satisfies approximately 66% of Chilean demand for refined oil products World class operator with state of the art facilities and an extensive logistics network in Chile 3 refineries, marine terminals, storage facilities for crude and refined products, pipelines, and the region s first LNG terminal Stable & long-term relationships with a diverse base of suppliers & buyers Proven access to multiple sources of financing Experienced and professional management Strong investment grade ratings since 2002 (Baa1/BBB-/A) Investors Presentation 26

27 Investors Presentation 27

28 Undisputed Leadership in Refined Products Cubic Meters (Thousands) Crude Oil Volume Processed dic-10 dic Light Medium Heavy Other gross inputs Cubic Meters (Thousands) Market Share 2011 in Chile Refined Products Production dic-10 dic Diesel Gasoline LPG Fuel Oil Kerosene Others 62,34% 57,65% 83,06% 79,79% 63,99% 56,05% 99,22% 76,98% 95,45% 66,32% 85,34% 72,23% Dec-10 Dec-11 72,29% 65,54% Diesel Gasoline LPG Fuel Oil Kerosene Other Average Source: ENAP Investor Presentation 28