Transcript Company Overview

Company Overview
1
Forward Looking Statements
Certain statements contained herein constitute
forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such
forward-looking statements involve known and
unknown risks, uncertainties and other factors, which
may cause the actual results, performance or
achievements of the Company to be materially
different from those expressed or implied. Forwardlooking statements involve risks and uncertainties,
including but not limited to, such risks as are
described in the Company's SEC filings and reports.
2
Highlights
•
•
•
•
•
•
Company Milestones
Reserves
Operations Plan
Infrastructure
Management
Financial Info
3
Company Milestones
Financial
• Reverse acquisition of an OTCBB shell company (11/03)
• 4 rounds of Private Placements (1/04 through 12/05)
• Additional Listing on German XETRA (05/04)
• SB-2 registration of private placement shares declared effective
(06/06)
• Listing on AMEX under trading symbol KAZ (09/06)
2006 Operational
•
•
•
•
Completion of 3D seismic on the Extended Territory (03/06)
Spudding of Dolinnoe 6 (08/06)
Spudding of Kariman-2 (08/06)
Spudding of Emir-6 (10/06)
4
Oil and Gas Reserves*
Emir
Dolinnoe
Aksaz
Type of
Reserves
Oil
(000
barrels)
Gas
(MMscf)
Total
(000 BOE)
P1
13,748
0
13,748
2P
91,622
97,982
107,952
3P
160,804
173,349
189,696
*IAW Chapman Petroleum Engineering Report dated April 1, 2006, not including Extended Territory
Reserves are estimated remaining quantities of oil and gas anticipated to be recoverable from known accumulations, from a
date forward.
5
Reserve Growth Potential*
Triassic formations
Jurassic formations
Borly
Yessen
Kariman
Newly Identified and Confirmed Formations
Triassic formations on extended territory
Jurassic formations on the ADE block and extended territory
Gas reserves for ADE and extended territory
Total
Resources (mln BOE)
153
25.8
20.4
199.2
*IAW Chapman Petroleum Engineering Report
Resources are defined as those quantities of oil and gas estimated on a given date to be potentially recoverable from
undiscovered accumulations. They are technically viable and economic to recover
6
Operational Strategy for FY ’07
(Ending March 31)
Drilling:
In accordance with the
operations plan we will
complete drilling and
testing of the following 3
exploratory wells:
• Dolinnoe-6
• Emir – 6
• Kariman – 2
Workover Operations:
• Fracturing
and
Coil
Tubing Acid Treatment
• Testing
• Dolinnoe-3
• Dolinnoe-2
• Aksaz-4
7
Drilling Schedule
1-Nov-06
1-Dec-06
1-Jan-07
1-Feb-07
1-Mar-07
1-Oct-06
31-Mar-07
1-Oct-06 - 30-Dec-06
Drilling Kariman 2
1-Jan-07 - 31-Mar-07
Completion and Testing Kariman 2
1-Oct-06 - 30-Dec-06
Drilling Dolinnoe 6
1-Jan-07 - 31-Mar-07
Completion and Testing Dolinnoe 6
2-Oct-06 - 20-Jan-07
Drilling Emir 6
22-Jan-07 - 31-Mar-07
Completion and Testing Emir 6
8
Infrastructure
9
Oil Quality
10
Net Back Calculation Under the
Export Quota
$60 - $14.15 - $0.92 - $1 = $43.83
Netback
Transportation
to Mangyshlak
station
Royalty (2%)
Discount
Oil Price
(Brent)
* Company is not subject to export rent tax during exploration stage
** Export Quota provides higher revenues for similar volumes of production compared to selling oil on domestic market
Management Team
Mr. Boris Cherdabayev – Chief Executive Officer. Mr.
Cherdabayev is a prominent figure in Kazakhstan's energy sector with
over 30 years experience in the international petroleum industry. Our
CEO held a number of positions in oil and gas sector, to include VP
for the National Oil and Gas company, and Director of the
TengizChevroil LLP
Mr. Askar Tashtitov – President. Mr. Tashtitov graduated from Yale
University with a Bachelor of Arts degree in Economics and History.
His working experience includes working for USAID-funded PA
Government Services Inc. as a oil and gas project specialist and for
BMB Munai as a financial analyst
Mr. Gamal Kulumbetov – Chief Operating Officer. Mr. Kulumbetov
held a number of positions, in various oil and gas companies, to
include TengizChevroil, Halliburton and Big Sky Energy
Mr. Sanat Kasymov – Chief Financial Officer. Mr. Kasymov held a
number of positions in a various Kazakhstani financial institutions, to
include Deloitte & Touche and Demir bank
12
Company Ownership Structure
Insiders (Founders,
Managem ent, Board of
Directors)
34%
66%
Institutional and Individual
Investors
13
Our Stock
52 Week H/L:
$4.50 - 10.65
Shares O/S:
Approx. 43.7 MM
Market Cap:
$196.7 - 465.4 $MM
Fiscal Y/E:
March 31
Analyst Coverage
Last Report Available at
Alfa Bank
http://www.alfabank.com/research/
Aton Capital
http://research.aton.ru/
14
Fulfillment of the Work Program
(monetary terms)
License
Work
Program
Commitment
Actually
Fulfilled
To the end of
2005
2006
2007
Total
21,500,000
(Not Including
Contract
Extension and
Expansion of
the Territory)
6,000,000
(Including
Contract
Extension
and
Expansion of
the Territory)
4,500,000
(Including
Contract
Extension
and
Expansion of
the Territory)
32,000,000
38,400,000
(as of December
31, 2005)
22,350,000
(as of
September
30, 2006)
60,750,000
15
Extension of the Exploration
Stage till July 2009
Application for this second extension is
underway and should be completed prior
to the end of the current fiscal year.
16
Basic Project Economics
•
•
•
•
•
•
Lifting Cost per BOE – $3.73
Domestic price per barrel – $27.40 (average)
Export Price per barrel – tied to Brent
We are not paying Export Rent Tax (33%)
Average CAPEX per well - $7.5 mln
Average CAPEX for workover - $507K
17
Financials – Q2FY07
Assets as of September 30th 2006
Current assets
53 095 177
Long term assets
84 620 066
Total assets
137 715 243
Liabilities as of September 30th 2006
Current liabilities
7 058 618
Long term liabilities
8 383 382
Shareholders' equity
122 273 243
Total liabilities and shareholders' equity
137 715 243
18
Financials – Q2FY07
For three months
ended 09/30/06
For three months
ended 09/30/05
4 016 972
1 385 336
575 698
186 434
General and administrative
1 955 246
4 880 514
Total expenses
3 024 240
5 415 228
992 732
(4 029 892)
199 133
144 435
Income/(loss) before income taxes
1 191 865
(3 885 457)
Net income/(loss)
1 016 352
(3 885 457)
Income/(loss) per common share
0,023262
(0,12)
Revenues
Oil and gas operating
Income/(Loss) From Operations
Other income (expense)
Total other income (expense)
19
Financials – Q2FY07
For six months ended
09/30/06
For six months ended
09/30/05
Net loss
(2 124 409)
(4 745 062)
Net cash provided by / (used in) operating activities
27 199 443
(4 891 741)
(16 640 253)
(9 418 727)
Net cash provided by financing activities
5 758 502
6 085 619
Net change in cash and cash eq-s
16 237 692
(8 224 849)
Cash at the beginning of the period
18 046 123
9 989 632
Cash at the end of period
34 283 815
1 764 783
Cash flows from operating activities:
Cash flows from investing activities:
Net cash used in investing activities
Cash flows from financing activities:
20
4,00
Earnings per Share
2,00
Cents per share
0,00
-2,00
1Q06
2Q06
3Q06
4Q06
1Q07
2Q07
-4,00
-6,00
-8,00
-10,00
-12,00
-14,00
Q2FY07 saw BMB Munai, Inc. produce first ever positive EPS
21
Financial Update
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
-1,000,000
-2,000,000
-3,000,000
-4,000,000
-5,000,000
1QFY06
2QFY06
3QFY06 4QFY06
Sales
Net Income
1QFY07
2QFY07
EBIDTA
22
Financial Update
5,000,000
4,000,000
3,000,000
2,000,000
1,000,000
0
-1,000,000
-2,000,000
1QFY06 2QFY06 3QFY06 4QFY06 1QFY07 2QFY07
-3,000,000
-4,000,000
-5,000,000
Sales
Net Incom e
*EBIDTA not accounting for one-time compensation expense
EBIDTA*
23
Basic Project Economics
FY
2004
FY
2005
I Quarter
FY 2006
II Quarter
FY 2006
974
5 957
2 346
4 017
4 761
11 860
6 098
3 024
(3 826)
(5 344)
(3 141)
1 016
Averaged Realized Oil Price
15,2
26,1
52,6
53.4
Expenses (USD/bbl)
68,9
48,9
46,8
40,2
G&A Cost (USD/bbl)
59,1
40,1
30,4
26,0
OPEX (USD/bbl)
5,8
3,4
9,3
7,65
Item
Sales, '000 USD
Total Expenses, '000 USD
Net Income, '000 USD
24
Basic Project Economics
Net Back Breakdown
$50,00
$45,00
$40,00
$10,67
$35,00
$30,00
Net back
$25,00
G&A expenses
Transportation costs
$20,00
$25,98
Lifting costs
Amortisation
$15,00
$10,00
$5,00
$0,00
$3,92
$3,73
$0,55
25
Basic Project Economics
Economics per bbl Produced
70,0
60,0
$/BBL
50,0
Averaged
realized oil
price
Expenses
40,0
30,0
G&A cost
20,0
OPEX
10,0
0,0
FY 2004
FY 2005
I Quarter FY
2006
II Quarter FY
2006
Period
26
Liquidity
• Company is listed on AMEX under a ticker symbol
KAZ, and on Deutsche Börse’s XETRA SE code
DL-,001 DMW US09656A1051
• Total issued and outstanding shares – 43,740,657
• Float – 22,754,932 (aprx. 52%)
27
Comparative Valuation
Source: ATON
28
Our Competitive Strengths
• Emerging Market Company headed by Kazakh
Management and conforming to US GAAP and SEC
Reporting Standards
• A trend of decreasing G&A, lifting and transportation
costs
• Management is devoted to increasing shareholder value
through operational efficiencies
• A company with a depth of experience in operations,
finance, government relations and managing risk of the
emerging market
29
Our Goals Are
• To maximize value to our shareholders
• To increase the reserves through continuation
of exploration on the ADE Block and Extended
Territory, resulting in reclassification of
resources of the Extended Territory into
various categories of reserves
• To prepare for transition to commercial
production stage by July 2009
• To seek value adding acquisitions
30