Latest Fastnet Company Investor Presentation (PDF - 5.2MB)

www.fastnetoilandgas.comFastnet Oil & Gas PlcCorporate PresentationDecember 2013

Company StrategyEarly Mover Foum Assaka MoroccoCreate Early Drilling Potential Foum AssakaValidate Potential & “Running Room” Foum AssakaIrelandAccelerate Drilling Foum Assaka Tendrara-Lakbir Morocco− Seek opportunities in dormant areas with latent potential− First to identify and apply for the Foum Assaka Licence− JV with operators with proven track record to mature prospects for drilling− Partnered with Kosmos Energy at early stage− Important for market perception of risk and reward− BP farms in to Kosmos equity – two wells: no “one well boom or bust”− Fastnet farmout concluded on 18 th December 2013− 3D Seismic acquired over Mizzen and Deep Kinsale licences (1,910km 2 )− Early processing results very positive – farmout anticipated Q1 2014− JV with partners capable of securing rigs− Kosmos and BP− Fastnet had identified early drilling as key to early gas monetisation inembryonic gas market growing by government commitment to develop gasto-powerTransparent exit strategy• Work in Progress“Lean” Board Salaries & Overhead Fastnet Oil & Gas Plc.− Cove Energy model – monetise after exploration success by “fit-for-purpose”corporate structure – separate subsidiaries in each geographic area− Distinguishes Fastnet from many AIM-listed companies− Early drilling creates early exit opportunity in success case− Management currently hold >15% equity aligning interests with shareholders− Board salaries low and no pension etc. entitlements; no bonuseswww.fastnetoilandgas.com 4

Company OverviewMoroccan AssetsIrish AssetsOutlook

Morocco - An emerging world-class hydrocarbon basin• Industry “hot spot” and keyexploration frontier• Significant activity in theregion since 2011:Near Term Drilling Activity• Fastnet management team anearly entrant to Morocco in2006• Considerable resourcepotential in North Agadir Basin• Partnership focused on worldclass mid-Cretaceous fansystem, similar play type toJubilee• 7 offshore and 6 onshorewells already scheduled fordrilling in Morocco in2013/2014Other Parties Active:ChevronChariotTotalFastnet “first mover” strategy prelude to industry recognising Morocco as a key frontierexploration area (yellow)www.fastnetoilandgas.com 8

Morocco: Fastnet’s early entry timeline• Shell relinquishes CapDraa and RimellaLicences• Island Oil & Gas/PaulGriffiths enters Moroccanonshore with ZagLicence award• Island Oil & Gas entersMoroccan offshore withSidi Moussa & FoumDraa Licence awardsPathfinder provides catalyst for other entrants• Kosmos enters Agadir Basin withPathfinder on Foum Assaka• Kosmos lists on NYSE ($7bn)and expands explorationacreage in West Africa• Farm-out agreed with Kosmoson Foum Assaka for additionalequity in Q3 2011• Kosmos Energyannounced that ithas entered into afarm-outagreement withBP plc., to earn a26.325% stake inthe Foum Assakapermit• Onshore TarfayaLicence awardedto Island Oil &Gas• Kosmos’ JubileeDiscovery inGhana• Productioncommences inGhana on JubileeDiscovery• 2,577km 2 of 3Dseismic acquiredon Foum Assaka• Kosmos set updrilling base atAgadir• Fastnet farm-outagreement with SKInnovation Ltd forhalf of Fastnet’sinterest in FoumAssaka, OffshoreMoroccowww.fastnetoilandgas.com 9

Morocco: Foum Assaka• Primary target: mid-Cretaceous deepwaterturbidite fan• BP brings a wealth ofexperience insuccessfully testingsalt structures (e.g.Gulf of Mexico)• Additional play types:Tertiary and BasalCretaceous deepwater channels andfan types• Multiple prospects andleads with diversegeological objectives• Primary prospectsCoS 15 – 20%• Carried through InitialPeriod WorkProgramme (based ongross budget cap of$16.2 million)• Drilling of first wellanticipated in H1 2014Cairn plannedexploration wellQ4 2013Pathfinder 2D SeismicLead – upgraded ifCairn well successfulEagle Complexwww.fastnetoilandgas.com 10

BP’s entry into Foum Assaka, Offshore Morocco• BP by far the largest oil major to have farmed into an asset offshore Morocco recently• Validates offshore Morocco as a resurgent exploration province• Reduces the risk weighting of the geological play in Foum Assaka• Establishes the prospective materiality of Foum Assaka to a deep-water specialist explorersuch as BP• Establishes the credentials of Fastnet, through its subsidiary Pathfinder as the “FirstMover” offshore Morocco• Cements the partnership with a specialist operator for a deep-water development• Ensures high profile news flow for the near-term drilling campaign• Fastnet and Kosmos now the only companies partnering a super-major offshore Morocco –another “first” for Fastnetwww.fastnetoilandgas.com 11

Fastnet farm-out agreement with SK Innovation• SK Innovation is an affiliate of SK Group the third largest conglomerate inSouth Korea• SK to acquire a 12.5% Gross interest (9.375% Net) in Foum Assaka licence• Up to two well carry comprised of a carry in the first exploration well on theEagle-1 Prospect and first appraisal well (capped at US$100 million perwell) or at SK Innovations’ discretion a carry in a second exploration well(capped at US$100 million]• Reimbursement of past costs of USD$3.2 million and a further payment of25% of Fastnet’s back costs relating to the period from 1 October to 1January 2014• Fastnet to retain a 12.5% interest (9.375%) and is left in a strong positionfinancially heading into an exciting drilling schedule in 2014www.fastnetoilandgas.com 12

Tendrara Lakbir Licence DetailsScale• 14,548 sq. km. Over entire prospective Missour Basin• Largest licence in Morocco over the proven Triassic Tagi gas play• Moroccan well density 33 times less than the global average including Algeria• TE-5/Lakbir Structure – Range of Gross Contingent Resources GIIP 311 BCF (P50)to 891 BCF (P10): Source SLR CPR November 2013• Running room has also been identified in five additional gas prospectsEquity & Partners• Pathfinder 37.5% equity after earn-in well• Partners: Oil and Gas Investments Funds (“OGIF”) 37.5%; ONHYM 25%• Pathfinder is the Technical Operator for farm-in well & Operator on assignment of interest• OGIF is a Moroccan exploration company owned by the largest financial institutions in Morocco (investment banking,insurance & pension fund management)Deal Terms & Activity• USD 300,000 entrance fee – no payment for past costs for drilling of six wells by previous operators and acquiring 488sq. km. of 3D seismic and 4,118 kms of 2D seismic• Pay 100% of a pre-development appraisal well to be drilled by 28/02/2014- Back Stop Date 30/09/2014- Estimated cost USD 8 MM• Land Rig identified• Provide refundable Bank Guarantee of USD 2.75 MM by 30/09/2014 – Drill or drop• Pay 100% of a well to be drilled by 01/04/2015• Pay 100% of a well to be drilled by 01/04/2018www.fastnetoilandgas.com 13

Onshore Basins in Saharan AfricaTendrara Lakbir Geological setting: Under-explored potential for large Hydrocarbon findsMoroccoWell density; 33 timesless than global averageTendrara – Missour BasinLicence AreaErrachidiaHasiMessaoud&Grand Erg/AhnetAlgeria14.3 billion boeproved reservesTrias/GhadamesIliziHamranSirteLibya47.3 billionboe provedreservesEgypt4.6 billionboe provedreservesTaoudeniPlaeozoicSub-Salt Super SystemNubianUpliftMesozoic/CenozoicSuper SystemErdisKufraIulleminedenChadWest Nubian ShieldWest Zaire Precambiran BeltSudDepth to Basement Map taken from Purdy’s Atlas; The Exploration Fabric of Africa. Approximate outlines of major North African basinswww.fastnetoilandgas.com 14

MOROCCO – Gas to Power Plans• National natural gas productionremains insignificant (60million m 3 (1.76 BCF) in 2009)Capacity 12.5 Billions M3/year (441.37 BCF/year)14% of transport capacity entitled to Morocco(currently unutilised)• 89% of gas requirement isimported• Strong domestic gas market(one of Africa’s largestconsumers)• Demand for energy hasincreased by 54% in last tenyears• Gas to Power is keyGovernment strategic target asis security of supply• Minimal risk of stranded gasLNG Terminal Initial Capacity5 Billions M3 ( 176.55 BCF)> 5 years before operational(at very early planning stage)Oil RefineriesMoroccan Energy and Electricity Demand Growth 2006 – 2030 (MEMW&E)www.fastnetoilandgas.com 15

Tendrara Lakbir Exploration History – TE-5 Structure• TE-5 Structure is defined by 3D seismic –488 sq. km. survey (2004)• 4,110 km. of 2D seismic acquired from1974 to 1986 – 4 x 6 km grid• 950 km. of 2D seismic reprocessed in 2002• TE-5 Structure flowed 1.4 mm cfgpd onextended well test• No pressure depletion observed on testing• SBK-1 drilled in 2000 flowed initially at 5mm cfgpd from TAGI Triassic reservoirs• Declined to 2.5 mm cfgpd – potentialpermeability barrier caused by fault closeto well bore (based on 2D seismicinterpretation)www.fastnetoilandgas.com 16

TE-5 Lakbir Prospect – P50 Case Areal ClosureTAGI-II SSDEPTH MAPC.I. = 25 MSCALE 1:80,000www.fastnetoilandgas.com 17

Tendrara Independent Resource Estimates: November 2013• New study by specialist Houston-based NuTech petrophysical team quantifies reservoir properties for theTriassic TAGI Sand consistent with good potential gas flow rates from a gross gas-bearing interval in TE-5of 82.2 meters• New reservoir engineering study by John Tingas PhD, MSc, Independent Petroleum Engineer, supportsrobust development cases, subject to a successful validation of flow rates in an appraisal well to the TE-5discovery and a step-out appraisal well to the northeast of the TE-5 discovery• New Independent Resources Estimates by SLR Consulting, based on these desk top studies and a reviewof historical published estimates, that were not previously validated by an independent Competent PersonsReport, give resource estimates, based on a 65% recovery factor, as follows:TE5-Lakbir Structure: Gross and Net Contingent ResourcesLOW BEST HIGH ESTIMATERecoverable BCF (100%) 30.1 310.5 891.9Recoverable BCF (37.5% Net) 11.3 116.4 334.5Chance of Success (%) 29 22 14NPV per BCF (US$mm) 2.29Risked Value (ENPV US$mm) 58.3Source: SLR CPR November 2013• Running Room has also been identified in five additional gas prospectswww.fastnetoilandgas.com 18

Forward Program and Exit Strategy• Reprocess existing 3D seismic data to select drilling location in reservoir “sweet spot” defined by strongseismic amplitudes• Re-evaluate historical drilling data and extended well test data• Objective is to engineer a well to potentially deliver 4 – 7 mm cfgpd on testing – TE-5 TAGI reservoirparameters are comparable to those for the producing Meskala Field• Drill and test appraisal well on TE-5 Structure by 30 September 2014 – a suitable land rig has beenidentified• 45 day well drilled to 2,600 meters maximum depth – estimated total cost c. USD 8 MM• Achieving the predicted well deliverability will de-risk a gas development for the substantial amounts of gasalready encountered in the TE-5 Structure and the exploration upside, allowing Fastnet to commission anupdated independent CPR report to support a future trade sale• Exit through a future trade sale, potentially at a multiple uplift to the value of the investment in drilling, to autility/gas-focussed integrated oil and gas company seeking a dominant position in the downstream gasbusiness – mirroring Cove Energy’s strategy in East Africa of proving up sufficient gas resources throughdrilling that is of attracting a potential bidder for the assetswww.fastnetoilandgas.com 19

Company OverviewMoroccan AssetsIrish AssetsOutlook

Ireland: Celtic Sea OffshoreHighly prospective basin capable of delivering significant near-term production• Attractive petroleumgeology with majorreserves potential: largestproducing gas field atKinsale Head, largeprospects with wellunderstoodDEEP KINSALElarge-fieldanalogues and existinginfrastructure• Underexplored, applyingnew technologies to deriskby analogy withsurrounding oil and gasdiscoveries• Shallow water prospects:easier to monetise thandeepwater Irish AtlanticMarginLargest ever 3D seismicsurvey undertaken inSummer 2013 (1,910km- Mizzen 1,400km 2- Kinsale 510km 2 DEEP KINSALE MOLLY MALONE MIZZEN &• 2 )Mizzen EastSHANAGARRY BLOCK 49/13AREA 285 km 2 648 km 2 1942 km 2 881 km 2 272 km 2WATER DEPTH c. 100 m c. 100 m c. 100 m c. 100 m c. 100 mFASTNET INTEREST 60% 100% 100% 82.35% 85%www.fastnetoilandgas.com 21

Ireland: Celtic Sea – Fastnet Licensing Options and AnaloguesPre-Atlantic opening tectonicelements showing importantdiscoveries/fields and locations ofLicensing OptionsAreas chosen for:Statoil’s 2013 FlemishBasin Discovery• Attractive petroleum geology• Major reserves potential• Existing seismic expected toimprove with modern processing• Fastnet management experience inthe specific areas• Exploration interest increasing dueto recent Flemish Pass Basindiscovery• Molly & Mizzen licences awardedJune 2012• Shanagarry and 49/13 awardedNovember 2012• Mizzen East Licence awarded May2013www.fastnetoilandgas.com 22

Ireland: Deep KinsaleKinsale Gas Field Structure• 3,514 boepd from 24 footbasal sand in Barryroe• Up to 160km2 structure• NuTech (Houstonbased) log analysisconfirms oil in 48/25• Running room andtrendology for majorsinterested in the singleasset of Barryroe• Enhances potential toprospective drillingpartners• Strengthens portfolio ofmaterial prospectswww.fastnetoilandgas.com 23

Early Stage Kinsale QC 3D Processing:Insights into Untested Graben-axis Purbeck PlayPreliminary Pre-Stack Migration “Deep Kinsale” Inline –Velocity QC SectionPreliminary Pre-Stack Migration “Deep Kinsale” Inline –Velocity QC SectionThicker sands (brighter seismictroughs) in half graben depocentreAlluvial FanTop M. Purbeck UnconformityTop M. Purbeck UnconformityFlat Spot? Within UpperPurbeck basin axis depocentreTop M. Purbeck Unconformitywww.fastnetoilandgas.com 24

Mizzen Inversion Events(New 3D Seismic – early in Testing Sequence)Interpretation of Fastnet’s newly acquired high resolution 3D seismic Data in the Kinsale andMizzen areas is expected to resolve many issues. It should also indicate the timing of inversionevents in these parts of the North Celtic Sea and shed some light on inversion timings.www.fastnetoilandgas.com 25

Company OverviewMoroccan AssetsIrish AssetsOutlook

Fastnet Oil & Gas: Forward Work ProgrammeProspectOFFSHOREMOROCCO(Foum Assaka)ONSHOREMOROCCO(Tendrara Lakbir)OFFSHOREIRELAND(Celtic Sea)ActivityCPR for New Prospect InventoryPurchase of Long Lead Drilling InventoryApprovedDrilling Preparation EIS StudyFarmout ActivityFarmout CompletionDrill First WellPortfolio Opportunities CompletedCPR for Prospect InventoryDrilling Preparation EIS StudyRig SourcedDrill First WellCPR Shanagarry, Deep Kinsale & 49/133D Seismic Acquired3D Processing and InterpretationFarmout Process2013 2014Q2 Q3 Q4 Q1 Q2 Q3 Q4✓✓✓✓✓www.fastnetoilandgas.com 27

Capital Expenditure – through to Q4 2014(US$’000) 1 (£’000)Placing proceeds 16,000 10,000Cash balance (Q3 2013) 10,602 6,626TOTAL 26,602 16,626Corporate costs (2,281) (1,426)Offshore Ireland (1,356) (847)Foum Assaka (Offshore Morocco) 2 (468) (292)Tendrara (Onshore Morocco) (13,286) (8,304)Deal costs (1,040) (650)Total cash outflow (18,431) (11,519)Balance 3 8,171 5,107Notes:1. Exchange rate of £1:US$ 1.62. Forecast costs are based on farm-out terms which include a reimbursement of past costs and a carry for drillingactivities in 20143. Excludes any potential cash proceeds of Celtic Sea farm-out (total past costs including 3D seismic survey are c. $20m)www.fastnetoilandgas.com 28

Structure & Indicative TimetablePlacing of new shares to raise £10.0 millionIndicative timetable of eventsInvestor roadshow from Wednesday 13 November 2013Indications Friday 22 November 2013Announcement and publication of shareholder circular Tuesday 26 November 2013General Meeting Friday 13 December 2013Admission and dealings Monday 16 December 2013www.fastnetoilandgas.com 29

Scoping Impact of Drilling Success to Fastnet’s Shareholders***Foum Assaka Licence AreaP50 P10Scoping Recoverable Oil MM BRL (gross)* 986 1,223Scoping Recoverable Oil MM BRL (18.75% net) 184 229.1Unrisked NPV @ US$13/BRL (MM US$)** 2,392 2,977Unrisked pence per share (fully diluted) 516p 595pRisked @ 11% COS 263.1 327.5Risked pence per share (fully diluted) 57p 71p* Source – SLR Consulting Foum Assaka CPR : May 2012** Source – Jefferies Morocco E&P Research Note April 2013*** At current equity levelsUpdated CPR on Foum Assaka Licence Area expected in December 2013Tendrara TE-5 Appraisal WellP50 P10Scoping Recoverable Gas BCF (gross)* 310.5 892.0Scoping Recoverable Gas BCF (37.5% net) 116.4 334.5Unrisked NPV @ US$2.29 MM/BCF (MM US$)* 279 803Unrisked pence per share (fully diluted) 58p 165pRisked @ 25%, 15% COS* 67.5 135Risked pence per share (fully diluted) 14p 25p* Source – SLR Consulting CPR release November 2013www.fastnetoilandgas.com 30

Summary – Near-term High Impact Drilling Programme with “Running-Room”• High Impact H1 2014 Drilling Programme in Fastnet’s acreage onshore and offshore Morocco• Multi-well drilling programme in 2013/2014 by other operators around Fastnet’s Moroccanassets• Potential drilling success may crystallise Fastnet’s exit strategy• Farm down of Fastnet’s exposure to the Foum Assaka deep-water drilling programme isprudent to maintain a balanced risk-reward exposure to protect and enhance current cashresources• Equity levels in Tendrara Lakbir onshore drilling option expected to be maintained at currentlevels based on much lower onshore drilling costs; lower risk of exploiting discovered gas;and potential for earlier monetisationwww.fastnetoilandgas.com 31

Appendiceswww.fastnetoilandgas.com 32

Company InformationAs at 16 th December 2013• Listed on AIM and ESM• Addition of Foum Assaka asset offshore Morocco droveinitial shareholder value in emerging industry “hot spot"KEY INFORMATIONAIMFASTESMFOITOTAL ORDINARY SHARES IN ISSUE 345,369,071• Addition of Tendrara Lakbir Exclusive Farmin Optioninto proven gas discovery onshore Morocco yet to befully factored in to the share price• Share price driver over next 12 months will be a veryactive drilling programme offshore and onshoreMorocco which if successful could lead to a multipleuplift in the valuation of the Company• Prudently managed cash resources to satisfy all currentwork programme commitments whilst allowing forpartial monetisation of the portfolio through ongoingfarm down discussions for carries in drilling and pastcostswww.fastnetoilandgas.com 33

Frontier Exploration Asset OverviewStrategic focus on high-volume, high- value, frontier petroleum systemsLicence Name Region AreaFastnet InterestGross Net Partner OperatorTendrara Lakbir Onshore Morocco 14,687 km2 50% 37.5% ONHYM, OGIF FastnetFoum Assaka Offshore Morocco 6,478 km 2 25% 18.75% Kosmos, BP (pending), SK (pending) KosmosMizzen Basin Offshore Ireland 787 km 2 100% 100% n/a FastnetMizzen East Offshore Ireland 1,155 km 2 100% 100% n/a FastnetDeep Kinsale Offshore Ireland 285 km 2 60% 60% PETRONAS FastnetShanagarry Offshore Ireland 881 km 2 82.35% 82.35% Adriatic Oil, Carob, Petro Celtex FastnetMolly Malone Offshore Ireland 647 km 2 100% 100% n/a FastnetBlock 49/13 Offshore Ireland 272 km 2 85% 85% Carob ltd, Petro Celtex FastnetTotal Area 25,192 km 2Average Commercial Discovery Size in MMBoe 2010-2012 byType of Hydrocarbon ProvinceMature95Standard283Frontier7710 200 400 600 800Note: Information from September 2012 Bernstein Research Reportwww.fastnetoilandgas.com 34

Ireland: Largest Ever 3D Seismic Survey in the Celtic Sea of 1,910 km 2Mizzen 3D Seismic – 1,400 km 2Total Option AreaCGG VantageMizzen 3D AreaMizzen 3D Area - Full Fold (3 km sail in)Deep Kinsale 3D Seismic – 510 km 2Deep Kinsale Seismic & Undershootwww.fastnetoilandgas.com 35

Fastnet Oil and Gas: “First Pass” Indicative Gross STOIIP and GIIP and RiskingCPR for 49/13 is pendingBest Estimate High Case CoS Oil or Gas CaseFoum AssakaShell Legacy Prospects Only 4.930 BBO – 11% OILShanagarryUpper Wealden 135.9 BCF – 10% GASLower Wealden 796.6 MMBO – 14% OILPurbeck 501.6 MMBO – 12% OILKimmeridgian-Portlandian 885.7 BCF – 5% GASUpper/Middle Jurassic 321.1 BCF – 5% GASMizzen BasinShallow Lower Cretaceous 2.075 TCF 4.724 TCF 12% GASCretaceous Prospect 1.799 BBO 3.899 BBO 4% OILDeep Triassic Prospect 3.108 TCF 9.356 TCF 5% GASMolly Malone BasinTriassic Prospect - North 6.677 BBO – 9% OILTriassic Prospect - South 5.833 BBO – 5% OILDeep KinsaleMiddle Wealden 856.3 MMBO 1.685 BBO 13% OILLower Wealden 530.1 MMBO 1.089 BBO 15% OILBasal Wealden Oil 265.0 MMBO 0.532 BBO 17% OILPurbeck 713.6 MMBO 1.556 BBO 15% OILTotal Oil 22.911 BBO OILTotal Gas 6.526 TCF GASwww.fastnetoilandgas.com 36