Turkmenistan Oil and Gas Conference. Sustainable Growth Using New Technologies. Dr. Abdul Jaleel Al Khalifa CEO, Dragon Oil November 2013

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1 Turkmenistan Oil and Gas Conference November 2013 Sustainable Growth Using New Technologies Dr. Abdul Jaleel Al Khalifa CEO, Dragon Oil

2 Dragon Oil Today Dragon Oil is a leading independent international oil and gas exploration, development and production company Headquartered in Dubai, UAE, with offices in Turkmenistan Owned 54% by the government of Dubai through the Emirates National Oil Company (ENOC) Our principal producing asset, the Cheleken Contract Area, is in the Caspian Sea, offshore Turkmenistan The asset is being developed under the Production Sharing Agreement since 2000 Exploration assets in Tunisia, Iraq and Afghanistan 11/27/2013 Dragon Oil - Sustainable growth using new technologies 2

3 The Cheleken Contract Area Excellent management of reserves 13 years of production growth and infrastructure development N Continued development of our people BLOCK1 LAM 28 LAM A LAM B LAM 63 LAM C BLOCK2 LAM75 LAM 21 LAM 10 LAM 04 LAM 13 DZHEITUNE (LAM) FIELD LAM 86 LAM 22 ZH 25 ZH ZH 60 ZH 21 BLOCK3 CASPIAN SEA DZHYGALYBEG (ZHDANOV) FIELD ZH 31 ZH ZH A TRUNKLINE KARAGEL TANK FARM TURKMENISTAN GOSP CPF ALADJA JETTY DRAGON OIL CAMP Export 11/27/2013 Dragon Oil - Sustainable growth using new technologies 3

4 Achievements since 2000 Impressive gross production growth since the commencement of the Production Sharing Agreement in 2000 Organic 2P oil and condensate reserves replacement of 190% against cumulative gross production Capital investment of over US$2.8bn Building well-head platform at Hazar 11/27/2013 Dragon Oil - Sustainable growth using new technologies 4

5 Gross Production Growth BOPD Tons/day 100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 - Gross average daily crude oil production, bopd Average gross production annual growth 21% 2015 gross production target 100,000 bopd F 2016F 2018F 2020F 13,000 12,000 11,000 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 11/27/2013 Dragon Oil - Sustainable growth using new technologies 5

6 Capital Investment Cumulative capital investment, US$bn US$2.8bn Onshore and offshore investment US$2.8bn Operating costs over the period US$0.6bn /27/2013 Dragon Oil - Sustainable growth using new technologies 6

7 Reserves Replacement Reserves replacement over 12 years 190% Reserves replacement in % Original Reserves Cumulative Production Reserves Additions 2012 Year End Reserves Platform-based drilling rig. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 7

8 New Platforms Eight new platforms constructed and installed in the Dzheitune (Lam) and Dhzygalybeg (Zhdanov) fields Four wellhead and production platforms: Lam A, B and C and Zhdanov A Three gathering blocks: Block-1, 2 and 4 One accommodation platform to complement the Dzheitune (Lam) 22 production platform Zhdanov B Platform is being constructed and modified Zhdanov A Platform Installation. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 8

9 Oil Storage Oil Storage Total oil storage capacity of 300,000 barrels The new tank farm Dragon Oil Tank Farm. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 9

10 Production Technologies 11/27/2013 Dragon Oil - Sustainable growth using new technologies 10 10

11 Pressure Maintenance Water Injection Start date: 28 June 2013 Current injection rate: 3,500-4,000 bwpd Average pressure increase in neighbor wells: around 100 psi (to be verified through another survey) Plan to expand water injection operations to 2-3 more platforms during 2014 Impact is 5-10% potential additional recovery where applicable Maintain pressure, sustain production rates and increase reserves recovery Water Injection Implementation. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 11

12 Artificial Lift KPIs Jet Pumps Start date: 5 June 2013 in two wells: Dzheitune (Lam) 13/118, 13/168 Average Production increase: bopd/well Plan to expand Jet Pump operations to 14 more wells during 2014 Objective is to increase production and enhance recovery Jet pumps implementation. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 12

13 Advanced Technology Implementation Chemical Trials Application: The effectiveness and cost of current chemical injection systems and chemicals for wax and corrosion reduction. Trial: Chemical injection trials using four different chemicals were carried out in the year Result: Reduction in pour point temperature, viscosity, accumulated wax in the pipelines. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 13

14 3D Laser Survey Advanced Technology Implementation Objective: Plant modifications and changes which are not reflected on the master drawing could be captured. Technology : Survey using Rapid 3D Laser scanning. Surveyed Platforms: LAM 21, LAM 22, LAM 75, LAM 10 and introduced : 1 st Quarter Photograph of platform Way Forward: Plan to survey 9 Offshore platforms and 3 Onshore facilities in PDMS model generated from scanning data 11/27/2013 Dragon Oil - Sustainable growth using new technologies 14

15 Company Procedure Improvement Integrity Management System (IM): To ensure safety and reliability of the plant assets. Structures Integrity Management System (SIMS) Pipelines Integrity Management System (PIMS) Corrosion Management System (CMS) Engineering Management System (EMS): standardized procedures, Forms, Templates, check lists, Technical Specifications & Data sheets and Quality procedures & Specifications ISO 9001:2008 certified; including OHSAS18001:2007 Organisations and certified / recognised as OHSAS14001:2004 Organisation Pipelines Integrity Management System (PIMS) 11/27/2013 Dragon Oil - Sustainable growth using new technologies 15

16 New Technologies Already Installed Water Injection Jet Pumps Expandable screens Remote Pig Tracking On the way ESP Cable Heating Gravel Packs Wax Elimination Rings (Vibration Induced Technology) Intelligent Pigging On evaluation Multilateral Wells Subsea Pipeline Cleaning using Nitrogen & Heat Generated System (SGN Technology) Implementation of new technologies. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 16

17 Investment in People Our Talent Over 1,550 professional originating from 50 countries 92% of Dragon Oil Turkmenistan workforce are Turkmen nationals Attractive career opportunities Training and Development In-house and external training programs with particular focus on national employees Develop HI potential employees with identified Individual Development Plans linked to Succession Plan Program Assistance with higher education tuition fees Dragon Oil employee. Training and development of Dragon Oil employees. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 17

18 Investment in Communities - Polyclinic Major c.us$5mn project completed: polyclinic building and related infrastructure Inauguration took place in March : concept stage. 2012: construction. 2013: completion. 11/27/2013 Dragon Oil - Sustainable growth using new technologies 18

19 Future Growth and Development Production target of 100,000 bopd in 2015 and plateau at this level for at least five years thereafter Deployment of significant jack-up and platform-based rig capacity Extraction of condensate at a GTP Loading Crude Oil at Aladja Jetty, Hazar 11/27/2013 Dragon Oil - Sustainable growth using new technologies 19

20 Conclusion Continued growth of Dragon Oil and our excellent performance are made possible thanks to our truly successful partnership with the State Agency and all other concerned authorities Thank you 11/27/2013 Dragon Oil - Sustainable growth using new technologies 20