1 MB - PGS

Petroleum Geo-Services ASA
Petroleum Geo-Services ASA
Lehman Brothers CEO Energy/Power Conference
Gottfred Langseth, EVP & CFO
New York, September 4, 2008

Cautionary Statement
• This presentation contains forward looking information
• Forward looking information is based on management
assumptions and analyses
• Actual experience may differ, and those differences may
be material
• Forward looking information is subject to significant
uncertainties and risks as they relate to events and/or
circumstances in the future
-2-

Key Topics Covered
• Key Facts About PGS
• Macro Drivers – and how they impact PGS
• Demand for HD3D* seismic
• How PGS is positioned in the HD3D market
• PGS’ technology differentiators
• Summary
*HD3D is defined as higher data density per unit area compared to conventional surveys.
-3-

Leading Geophysical Company
Marine
Data Processing
and Technology
Onshore
Marine market
leadership
Technology
differentiation
Regional highend
focus
• USD 1.27 billion in
revenues in 2007 (~85%
of total revenues)
• 20 Data Processing
centers world wide
• USD ~75 million in
technology spending
-4-
• USD 246 million in
revenues in 2007 (~15%
of total revenues)

Financial Summary
Revenues
Adjusted EBITDA
USD million
500
450
400
350
300
250
200
150
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08
USD million
275
255
235
215
195
175
155
135
115
95
75
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08
EBIT
Cash Flow from Operations
250
*
250
200
200
USD million
150
100
USD million
150
100
50
50
0
0
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08
*Gain from sale of Ramform Victory to METI.
Adjusted EBITDA, when used by the Company, means income before income tax expense (benefit) less, other financial items, interest expense, interest
income, income (loss) from associated companies, other operating (income) and depreciation and amortization.
-5-

PGS’ Advanced Seismic Acquisition Capacity
• Seven high capacity Ramforms
– Six Ramforms in current operation
– One Ramform new-build (delivery June 2009)
• Two “Arrow” 3D new-builds
– Scheduled for delivery July 2009 and late January 2010
• Five “6-streamer” vessels
• Seven 2D/source vessels
– Four owned source/2D vessels
– Three vessels chartered in on time charters
• 8 – 12 Onshore crews
– Approximately 80,000 channels
– Capabilities in all terrains
The acquisition of Arrrow Seismic also gave PGS control of two 3D vessels chartered to Fugro and CGGVeritas
and two new-build 3D vessels on lease agreements to WesternGeco.
-6-

Bringing Marine Productivity to the Next Level
The new Ramform S-class
• Ramform Sovereign commenced in operation
March 31
• The most productive vessel in the industry
– Transit speed* +25%
– Endurance* +50%
– Fuel efficiency* +15%
• The vessel performs extremely well, already set 2
new industry records in:
– Simultaneous towing of 17 streamers
– Towing the widest spread ever done by a
single vessel (14 streamers with 100 meters
separation = 1,300m wide spread)
• Ramform Sterling on plan to be delivered end
June 2009
* With Ramform V-class as benchmark
-7-

Marine
Late August 2008 Streamer Operation
Falcon Explorer
(Greenland)
Atlantic Explorer
Ocean Explorer
(Barents Sea)
Ramform Challenger
Ramform Viking
Ramform Sovereign
Ramform Vanguard
(North Sea)
Akademik Fersman
(Sakalin )
Aquila Exlorer
(Trinidad)
Ramform Valiant
(Brazil)
Nordic Explorer
(Cambodia )
Harrier Explorer
(to Cyprus)
Ramform Explorer
Pacific Explorer
(Malaysia)
Orient Explorer
(Indonesia)
-8-

Onshore
Late August 2008 Worldwide Operations
Alaska - 1 Crew
Canada - 1 Crew
US - 4 Crews
Mexico - 1 Crew
Morocco - 1 Crew
Tunisia - 1 Crew
Peru - 1 Crew
Cambodia - 1 Crew
Brazil - 1 Crew
Seasonal markets
Alaska
Canada
Active crew
Unactive crew
-9-

Demand for Energy Will Increase
Oil Consumption per Capita (bbls)
30
25
20
15
10
5
• Per capita consumption of
oil in large emerging
economies is a fraction of
the OECD average
• There are 3 billion people in
fast growing emerging
economies
0
United
States
OECD
Average
Japan Germany China India
• As standard of living
improves demand for energy
will increase
Source: Simmons & Company International
-10-

RRR on Slight Increase But Still Too Low
Reserve Replacement Ratio
• Higher E&P
investments, oil price
and technological
advancements have
allowed oilcompanies
to book a slight
increase in reservoir
reserves
• Higher E&P spending
needed
Source: SEB Enskilda’s Tenth Annual E&P Survey, the graph is based on comments from 25 IOCs.
-11-
-11-

Strong Expected Growth in E&P Spending
• Spending
expectations* for 2008
have increased from
125% above 1998
levels last year to
139% in this year
• The corresponding
number for 2009 is
159%, revised up from
138% in last year’s
survey
*According to SEB Enskilda’s Tenth Annual E&P Survey.
Enskilda expect growth in total E&P spending in 2008, 2009 and 2010 to be 19%, 13% and 10% respectively.
-12-

PGS Order Book at Record Level
1200
1000
Order Book
• Order book is now above
USD 1 billion
– Marine USD 968 million
– Onshore USD 113 million
USD million
800
600
400
200
• Trend towards longer and
multi-season contracts
– Especially among NOCs
0
Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08
Marine
Onshore
-13-

Record High Bidding Activity
Marine Seismic Acquisition
3,500
• Tendering activity * at
record levels
3,000
USD million
2,500
2,000
1,500
1,000
500
-
• Strong demand for high
capacity vessels, less
visibility for 6 streamer
vessels
feb.04
jun.04
okt.04
feb.05
jun.05
okt.05
feb.06
jun.06
okt.06
feb.07
jun.07
okt.07
feb.08
jun.08
Active Tenders
All Sales Leads (Including Active Tenders)
* Source: PGS internal estimate as of July 2008, Active Tenders and All Sales Leads 3D Contract Seismic only.
-14-

Increasing Demand for Advanced Seismic
HD3D total sqkm acquired
120
100
80
60
40
20
40
35
30
25
20
15
10
5
HD3D as %age of total activity in sqkm
• The HD3D* segment has
grown significantly over the last
3 years, both in absolute size
and in share of total activity
• In 2009 we expect HD3D will
be over 40% of the total market
in sqkm terms, and significantly
more in terms of revenue and
production capacity
0
2003 2004 2005 2006 2007 2008E
0
HD3D Sqkm '000
HD3D as % or total activity in sqkm
*HD3D is defined as higher data density per unit area compared to conventional surveys.
Source: PGS internal estimate.
-15-

Ramform Advantage in Growing HD3D* Market
60
• In 2009, Ramform streamer
capacity will be approximately
75% of PGS total
% activity in HD3D segment
50
40
30
20
10
• The Ramform fleet has
consistently captured a large
share of the HD3D segment
• 80% of PGS’ work awarded** for
2009 is HD3D
0
2003 2004 2005 2006 2007 2008E
rest of industry HD3D as % of total activity
Ramform HD3D as % of total activity
• 50% of Ramform capacity** is
sold in 2009
*HD3D is defined as higher data density per unit area compared to conventional surveys.
**By end Q2 2008.
Source: PGS internal estimate.
-16-

Favourably Positioned on the Industry Cost Curve
Streamer count
1-400
401-500 501-600
Ramform Sovereign
Ramform Sterling
Ramform Valiant
Ramform Viking
Ramform Vanguard
Ramform Challenger
Arrow Newbuild 3
Arrow Newbuild 4
Ramform Explorer
Pacific Explorer
Atlantic Explorer
Nordic Explorer
Ocean Explorer
Orient Explorer
Laurentian
• PGS’ fleet is well positioned to generate high margins in a strong Marine
seismic market
• Adding quality assets and emphasising efficiency
Source: The cash cost curve is based on PGS’ internal estimates and highest number of streamer towed. The graph shows all seismic vessels in
the market, both existing and new-builds announced until end Q1 2008.
-17-
Relative cost efficiency per streamer per day

Ramform Vessels Sustain Long-term Competitive Advantage
1992 - 1996
1998 - 1999 2007 - 2009
Competition
PGS
4 – 6 streamers
Matches vessels built 10+ years later
6 – 8 streamers 8 - 12 streamers
Matches vessels built 10+ years later
8 & 12 streamers 16 - 18 streamers 22 streamers
Matches vessels built 10+ years later
More streamers, longer streamers and denser streamers.
Operational and cost efficiency are key success factors
-18-

Marine Seismic Acquisition Capacity is Increasing
• Total streamers used expected
to rise
– ~15% in 2008 over 2007
700
58% capacity
increase from 2005
to end 2008
80
– ~25% in 2009 over 2008
– ~20% in 2010 over 2009
600
70
Streamers
500
400
300
200
100
60
50
40
30
20
10
Vessels
• PGS streamer count expected
to rise
– ~2% in 2008 over 2007*
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008E 2009E 2010E
0
– ~15% in 2009 over 2008*
Total Streamers Worldwide (Usual Configuration)
Total Vessels Worldwide
– ~20% in 2010 over 2009*
Higher E&P spending and more complex surveys absorbs capacity increase
* Excluding Ramform Victory
Source: PGS Internal Estimate July 2008
Total Streamers Worldwide and Total Vessels Worldwide are estimates of 6+ streamers 3D vessels
-19-

PGS’ Drivers of Productivity
Multitow –
Reducing drag
increasing survey
speed.
Source monitoring – Reducing
downtime of source operations.
Integrated Acoustic
Positioning
Cable cleaner –
Reducing
downtime in
areas with
barnacles.
Improved foil fairing
technology – Reducing
drag and increasing
reliability.
Deflector
steering
system –
Increasing
speed in
turns.
2007 2008
Ramform Sovereign
Unmanned vehicles –
Improving efficiency and
safety.
2009
GeoStream
er® – 3D A
Step
Change
Source QC
program –
Detecting
faulty guns,
directivity
variations.
Lateral
Streamer
Steering
Gun steering system – Improving 4D
quality and efficiency.
Onboard real
time
optimization
of turns.
Super Slim
GeoStreamer ®
New Front Stretch
Less Noise
Less Tension
-20-
Front end depth control –
Improving the weather window and
handling safety.

GeoStreamer®: Industrialization on Schedule
Launch EAGE
June 2007
TCA with
Shell
Aquila equipped with
12 km GeoStreamer® –
Two additional
Test lines GoM Atlantic Explorer 6 streamer vessels
MC2D Trinidad 6x6 km spread during 2009
Q4
2008 2009
Field Trials
North Sea
First commercial job
NW Australia
Akademik Fersman
Harrier equipped
With 8 km
GeoStreamer®
MC2D Cyprus
Various exclusive
testlines Med
Laurentian
Southern Explorer
8 km GeoStreamer®
• Robust system delivering improved
efficiency – not one day of weather
downtime in Australia
• Seismic bandwith dramatically
enhanced
• Massive client interest
• Large number of leads for direct
awards
• Further development of technology
ongoing
-21-

GeoStreamer® Gaining Momentum
• First 3D GeoStreamer® job sold with
uplift in revenues compared to a
conventional job
• Plan to introduce GeoStreamer® on 6
streamer vessels first
• One 2D GeoStreamer® vessel
operational in each region by year end
GeoStreamer® combines two different sensors yielding
enhanced resolution and better penetration as well as
improved efficiency due to deeper tow
-22-

PGS Value Drivers
-23-
• Focused integrated seismic
company
• Positioned for growth
• Productivity & scale
– Best-in-class vessel portfolio
– Largest 3D MC library
• Technology differentiator
– Unparallelled investments in quality
and operations
– Strong technology pipeline
• Strong operational record
• Proactive, countercyclical financial
management
– Value creation through the cycle
Strong underlying demand fundamentals – Unique position to
benefit from increasing demand for advanced seismic