1. business and industrial
2. energy
3. natural gas

Capital Markets Day
13 November 2014
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2
Highlights and strategy
Political update
KRI oil business
KRI gas business
Exploration
Financials and guidance
Summary and Q&A
3
HIGHLIGHTS
 KRI exports ramp-up
 Pipeline capacity in Turkey no longer a constraint – currently 500,000 bopd to increase to 700,000 bopd by
year-end 2014
 Pipeline exports currently at c.300,000 bopd, expected to increase to 400,000 bopd by year-end and 500,000
bopd in Q1 2015
 KRG on track to budget equilibrium in Q1 2015
 Increasing production
 Net working interest production up 47% YTD to 66,000 boepd
 Strong future production growth: 2015 working interest production guidance of 90,000-100,000 boepd
 New gas deal signed
 Term sheet signed with the KRG Ministry of Natural Resources for development of Bina Bawi and Miran
 Key terms agreed with OMV’s to acquire its 36% operated stake in Bina Bawi
 Strong financial position
 Strong balance sheet with cash balances at end Q3 2014 of c.$660 million
4
STRATEGY
 Maintain the highest level of corporate governance
 Create value with the drill bit
 Manage our KRI business on a broadly cash flow neutral basis
 Maximise shareholder returns by monetising at all points in the exploration,
development and production cycle and return excess cash to shareholders
 Build a material Exploration and Production company
5
Highlights and strategy
Political update
KRI oil business
KRI gas business
Exploration
Financials and guidance
Summary and Q&A
6
POLITICAL UPDATE – KRI EMERGING AS A REGIONAL FORCE
 KRI safe and secure
 KRG consolidating power in expanded KRI with international support
 KRG has a prominent position in new Iraqi Government
 KRG on track to budget equilibrium in Q1 2015
 Turkey remains resolute in its support for the KRG
7
KRI INDEPENDENT EXPORT ROUTE ESTABLISHED
 3 month track record of pipe exports to Ceyhan
 Pipeline export capacity 500,000 bopd by end November, 700,000 bopd by
early 2015
 Storage capacity of 2.5 mmbbls available for KRI crude at Ceyhan
 30 cargoes with over 23 mmbbls of KRI crude lifted, regular sales made
 24 cargoes delivered oil
 5 en route to destinations
 1 tanker offshore US as claim goes through US courts
 Payment for KRI oil flowing to KRG via KRG controlled Halkbank account
 KRI exports will continue to increase
Note: Information on cargoes, tankers and sales based on Platts and Bloomberg reports
8
KRI EXPORT EVOLUTION
Total export
volumes (kb/d)
58
107
101
163
184
310
380
430
495
525
545
700
700
700
480
500
800
600
KRI budget equilibrium:
c.500kbpd export volumes
500
kbopd
500
400
300
300
300
300
450
200
150
150
350
400
280
0
107
150
57
56
34
30
30
30
45
45
45
Jul-14
Aug-14
Sep-14
Oct-14E
End
Nov-14E
End
Dec-14E
End
Jan-15E
End
Feb-15E
End
Mar-15E
49
44
16
42
59
Q1-14
Q2-14
Trucked exports
Pipeline exports
Pipeline capacity
Note: Liquids export volumes are indicative based on publicly available information, media reports and internal estimates. Data reflects averages for historical periods and month end estimates for forecasts
Source: Company disclosures, media reports
9
REGIONAL PIPELINE INFRASTRUCTURE
40” Pipeline with 500,000 bopd of capacity,
upgrade to 700,000 bopd by year-end 2014
Tank Farm = 9.5 mmbbls capacity
Allocated to KRI = 2.5 mmbbls capacity
Tawke field, 100,000 bopd of
pipeline capacity, rising to
>350,000 bopd by year-end 2014
400,000 bopd
capacity pipeline to
expand to 700,000
bopd by early 2015
Taq Taq
46” Pipeline with
1mm bopd of capacity
Khurmala Dome
30 tankers shipped totaling over
23 mmbbls of Kurdish crude
Avana Dome
Bai Hassan
Baba Dome
Kurdistan Region of Iraq (KRI)
KRG controlled areas
KRI export pipeline
Iraq Turkey pipeline - Iraq section (currently disused)
Iraq – Turkey pipeline – Turkish section
Note: Information on cargoes, tankers and sales based on Platts and Bloomberg reports
10
Highlights and strategy
Political update
KRI oil business
KRI gas business
Exploration
Financials and guidance
Summary and Q&A
11
LOW COST AND RESILIENT KRI OIL AND GAS BUSINESS
Breakeven of non-producing and recently on-stream oil assets
 Low cost onshore oil and gas:
160

Taq Taq and Tawke life of field F&D costs < $3/bbl

Taq Taq and Tawke opex < $2/bbl
150
Marginal
heavy oil
and deep
water,
Kashagan
140
130
Miran and Bina Bawi life of field F&D < $5/boe
 Low breakeven oil price for KRI PSCs relative to other
fiscal regimes
 Kurdistan PSCs relatively insensitive to oil price for
Contractors


120
Commercial breakeven (US$/bbl)

(1)
110
100
90
80
Brazil Campos basin, Bakken
core, Permian Delaware, Utica,
Iara, GoM and heavy oil
70
Taq Taq and Tawke: 10% fall in oil price = c.6% fall in
net Contractor proceeds over the next 2 years
60
Cash flow margins resilient to oil price volatility relative
to other fiscal regimes
40
50
Best of GoM, Brazil Santos
basin, Johan Sverdrup
30
Kurdistan
20
-
10,000
20,000
30,000
40,000
50,000
Cumulative peak oil production (kb/d)
1) Includes surface gas treatment facilities.
Note: Estimates for breakeven prices do not include the costs of acreage acquisition or exploration that, if
included, would lead to higher breakeven commodity prices. This can be particularly material for North
American onshore resource plays
Source: Top 400 Projects, Goldman Sachs Global Investment Research
12
TAQ TAQ UPDATE
 9M 2014 average production c.97,000 bopd
Taq Taq well locations:
Plan View
 Wells

17 current producing wells with well production
capacity of c.150,000 bopd

First horizontal well TT-24 to spud in Q4 2014

One additional well to be drilled in 2015
 Facilities and infrastructure

Installation of temporary production facility to increase
processing capacity to 150,000 bopd in Q1 2015

Completion of CPF II in Q3 2015 to permanently
increase facility capacity to 200,000 bopd

Taq Taq export pipeline capacity at 150,000 bopd
13
TAWKE UPDATE
 9M 2014 average production of c.87,000 bopd
 Wells

Tawke-25 and Tawke-26 (horizontal) recently completed,
initially tested at up to 7,500 bopd and 5,000 bopd respectively

New Tawke-28 well undergoing stimulation and testing, rig
moved and currently drilling Tawke-27

With five horizontal wells drilled in 2014, total number of wells
will reach 28 by year-end, of which 25 are on production

Two additional Cretaceous wells to be drilled in 2015
 Facilities and infrastructure

Installation of 80,000 bopd EPF to increase processing
capacity to 200,000 bopd by early 2015

New 24 inch pipeline to Fishkhabour expected to be complete
by year-end to increase export capacity to >350,000 bopd and
deliver transportation system redundancy
14
Highlights and strategy
Political update
KRI oil business
KRI gas business
Exploration
Financials and guidance
Summary and Q&A
15
TRANSFORMATIONAL KRI GAS BUSINESS
 World-class resource
 11tcf mean gas resources, 80 mmbbls mean liquid resources
 Material and growing domestic market opportunity
 3-5 bcma of near-term domestic market demand from power plants and industrial users
 Cost competitive
 Well positioned on cost curve to meet Turkish gas demand
 Next to one of world’s fastest growing, major gas markets
 Turkey gas exports – short, low-cost tie-in to Turkey infrastructure
 KRG / Turkey GSA signed
 4 bcma of gas exports from 2018
 10 bcma by 2020 and option of increasing to 20 bcma thereafter
 KRG to become major gas exporter
16
NEW DEAL – A WIN-WIN FOR KRG AND GENEL
 New gas deal signed
 Detailed Gas term sheet signed, final PSC Amendment Agreement to be completed by year-end
 Miran and Bina Bawi to be combined under one PSC
 Genel to become sole Contractor at Miran & Bina Bawi
 Genel to acquire OMV’s 36% operated stake in Bina Bawi; $20m upfront and $130m staged after first gas
 Financing solution
 Contractor responsibilities: (i) oil development, (ii) gas wells & flowlines, (iii) first stage condensate
separation
 KRG responsibilities: gas treatment facilities
 Reduced gross Contractor gas capital exposure to c.$1bn until first gas
 Unlocks significant value for KRI and Genel
 Attractive life of field returns for Genel’s gas business including historic acquisition costs
17
NEW DEAL – GAS & CONDENSATES
 Structure

New structure (gas/condensates)
Miran and Bina Bawi combined under one PSC with one
aggregate production target: 1,400 mmscfd raw gas from 2018
Raw Gas
Wells

Gas wells and flow lines

First stage condensate (primarily C5+) removal plant

Condensate storage and loading facility
Contractor
 Genel’s responsibilities (development & operation)
Export market
Trunk/flow lines
Condensates (C5+)
First Stage
Condensate
Removal Plant
 Genel’s entitlement

$0.78 fee per mscf raw gas delivered to gas treatment plant
 KRG responsibilities (development & operation)

Gas treatment facilities

Completed through a 3rd Party EPC contract – KRG to begin
tender process H1 2015
 KRG entitlement

100% sales gas

100% residual condensates and LPGs (primarily C3 to C5)
Condensate
Removal + Loading:
Residual
Gas Stream
3rd Party
100% condensates separated at first stage removal plant
3rd Party Gas
Processing
Facilities
Sulphur
Genel responsibility
Sales
Gas
KRG

Condensate
Loading Facilities
Residual
Condensates
& LPGs
KRG responsibility
Turkey
GSA
18
NEW DEAL – OIL
 Structure

Miran and Bina Bawi combined under one PSC
 Responsibilities (development & operation)

Contractor responsible for the development and
operation of all oil resources
 Contractor entitlement

100% oil produced until all licence back costs (including
historic oil, gas and acquisition costs) fully recovered

Thereafter 50% of oil produced
 Resource
 Range: 24–34–71 mmbbls
 30 mmbbls to be booked as 2P reserves at year-end
 Development

Fast track development with Early Production Facilities

Provides early cash flow to offset against the gas
development capex
Miran – cross-section
19
MIRAN AND BINA BAWI RESOURCES
Raw gas (tcf)
Liquids (mmbbls)(1)
19tcf
20
18
80
142mmbls
70
16
7
14
60
79mmbls
11tcf
50
12
50
60
40
10
4
8
48mmbls
6tcf
30
6
12
20
2
4
2
32
30
17
7
23
10
4
21
13
11
7
0
0
Low
Mean
Bina Bawi Raw Gas
High
Miran Raw Gas
4
1
Low
Condensate
Low Oil
Bina Bawi Condensate
Mean
Condensate
Mean Oil
Bina Bawi Oil
High
Condensate
Miran Oil
High Oil
Miran Condensate
Note: Downside / Upside show cumulative P10 / P90 figures
1) Condensate volumes are expected volumes from 1st stage separation (all net to Genel)
Source: Miran (RPS November 2012), Bina Bawi (RPS August 2013), Genel.
20
KRI GAS – GAS / CONDENSATE DEVELOPMENT ASSUMPTIONS
Miran
Bina Bawi
Mean raw gas
4.3tcf
7.1tcf
Mean sales gas
3.5tcf
4.9tcf
32mmbbls
13mmbbls
c.35 development wells
c.35 development wells
Average well costs
$28m per well
$32m per well
Trunk/flowlines
$5m per well
$5m per well
$75m
$75m
$0.8/boe
$0.6/boe
Mean condensate(1)
Number of wells
Condensate loading
& separation facility
Opex
PSC restructuring lowers gross Contractor capital investment to $1bn until first gas
1) Condensate volumes are expected volumes from 1st stage separation (all net to Genel)
21
KRI GAS – ROAD MAP TO MONETISATION
2013
2014
2015
2016
2017
2018
DOC
Miran
HORIZTONTAL
OIL WELL
EARLY OIL
EWT
DOC
OIL PRODUCTION
Bina Bawi
EXPORT GAS/CONDENSATE
OIL PRODUCTION
FEED
MW5
Miran
FID
TURKEY / KRG
ENERGY
AGREEMENT
Bina Bawi
BB4/5
TESTING
GENEL / KRG
TERM SHEET
AMENDMENT
SIGNED
GENEL / OMV
BINA BAWI
BUY-OUT
AGREEMENT
REACHED
EARLY DOMESTIC GAS & EXPORT
CONDENSATE SALES
EXPORT GAS &
CONDENSATE
SALES
EARLY DOMESTIC GAS & EXPORT
CONDENSATE SALES
EXPORT GAS &
CONDENSATE
SALES
PSC AMENDMENT
AGREEMENT
COMPLETED
FID
EWT: Extended Well Test; DOC: Declaration of Commerciality; FEED: Front End Engineering Design; FID: Final Investment Decision; PSC: Production Sharing Contract
22
Highlights and strategy
Political update
KRI oil business
KRI gas business
Exploration
Financials and guidance
Summary and Q&A
23
EXPLORATION – FOCUSED AND DISCIPLINED
 KRI

Peshkabir exploration

Chia Surkh appraisal

New opportunities
 Africa

Exit Malta

No plans for further drilling offshore Angola

Evaluate Morocco

Ethiopia first well end 2015/early 2016

Somaliland commence seismic operations by end 2015

Refocus new ventures onshore sub-Sahara
 Middle East

Continue to evaluate onshore opportunities
24
HORN OF AFRICA
 Somaliland – Blocks SL-10B/13 & Odewayne

Odewayne Block 50% Op
Seismic acquisition in Q4 2015 aimed at unlocking Yemeni equivalent fairway
 Ethiopia – Adigala Block

Berbera
Burao
Hargeisa
Mesozoic prospectivity defined – c.200km2 structure identified on field
processed data (200-750 mmbbls prospect)
Block SL-10B/13 75% Op
Adigala
AdigalaBlock
Block40%
40%Non
NonOp
Op
Target : Tilted Fault Block
100km
Prospect Area
defined by 2014 2D
Seismic Data
Exhumed Jurassic Oil Field
10km
2014 2D Seismic
2009 2D Seismic
Adigala – cross-section
25
Highlights and strategy
Political update
KRI oil business
KRI gas business
Exploration
Financials and guidance
Summary and Q&A
26
PRODUCTION AND SALES
Net Genel production (kboepd)
kboepd
100
80
Net Genel revenues ($m)
YTD Average: 66kboepd
60
40
@ $100/bbl
Sep-14
Aug-14
Jul-14
Jun-14
May-14
Apr-14
Mar-14
Feb-14
$600-700m(1)
Jan-14
20
$500-600m(1)
90-100
kboepd
$500-600m(1)
@ $80/bbl
60-70
kboepd
348
44
FY 2013
2014E
2015E
FY 2013
2014E
2015E
(1) 2014E and 2015E guidance revenue recognition methodology on an accruals basis for domestic and export sales
27
BALANCE SHEET AND CAPITAL EXPENDITURE GUIDANCE
$650m
 Strong balance sheet
$564m
 Disciplined capital spend in KRI
 Focused and disciplined exploration
$300-350m
programme
$229m
 Potential for cash return to shareholders
$86m
2011
2012
KRI Development
2013
2014E
KRI Exploration & Appraisal
2015E
Africa Exploration
28
TRANSITION FROM DOMESTIC MARKET SALES TO EXPORTS
 Increased profitability

75% of sales now benefitting from pipeline export netback

Pipeline transportation cost $5-10/bbl
 Export cash flows

Q3 cash flow impacted by move to exports paid in arrears

Receivables currently less than 4 months of revenue
vs. 2-3 months expected once cash flows are normalised
Genel working interest production
(bopd)
100,000
2014
90,000
80,000
70,000
60,000

KRG assurance that Contractors will be paid in full in line with PSC
 Future free cash flow benefit
50,000
40,000
30,000
20,000

2015 sales expected to be at export pricing
10,000


Export cash flow and reduced capex will generate sustainable
free cash flow going forward
0
2011
2012
2013
1Q
2Q
3Q
4QE 2015E
Increased potential for cash return to shareholders
Barrels benefitting from pipeline export pricing
29
Highlights and strategy
Political update
KRI oil business
KRI gas business
Exploration
Financials and guidance
Summary and Q&A
30
SUMMARY
Politics
KRI exports
KRI Oil
KRI Gas
Exploration
Financials

KRI remains safe and secure, KRG working closely with international community

Progress continues to be made following the formation of the new Iraqi Government

Pipeline capacity in Turkey not a constraint – 700,000 bopd by early 2015

Pipeline export volumes currently at c.300,000 bopd to increase to 400,000 bopd by
year-end and 500,000 bopd in Q1 2015

KRG on track to budget equilibrium in Q1 2015

Significant production growth of 47% YTD to 66,000 bopd

Low cost and resilient KRI oil and gas business, relatively insensitive to oil price volatility

New Miran and Bina Bawi gas deal signed with the KRG

Genel acquisition of OMV interest in Bina Bawi

Significant value creation for KRI and Genel

Focused and disciplined

Balance sheet strengthened

Rising cash flows as pipeline exports become sustainable

Disciplined 2015 capital programme
31
Appendix
32
GENEL ENERGY KRI LICENSES
Khurmala to Fishkhabour, 400,000 bopd capacity
Taq Taq to Khurmala
150,000 bopd capacity
33
Capital Markets Day
13 November 2014