CORPORATE PROFILE PETRONET LNG LIMITED March, 2012
OVERVIEW Global & India s Primary Energy Consumption Scenario India s Gas Scenario, Infrastructure Role of LNG in India About Petronet s Dahej & Kochi Terminals New Initiatives Performance
PRIMARY ENERGY PER CAPITA CONSUMPTION Source : BP Statistical Review June 2011
PRIMARY ENERGY CONSUMPTION (MTOE) - WORLD Fuel 2005 % 2010 % Year 2005 6% 6% Oil Oil 3837 36 4028 34 Gas 2475 24 2858 24 Coal 2930 28 3556 30 28% 24% 36% Gas coal Nuclear Hydro Renewables Nuclear 627 6 626 5 Hydro 669 6 776 6 Renewables - - 159 1 Total 10537 100 12002 100 1% 5% 6% 30% 24% 34% Year 2010 Oil Gas coal Nuclear Hydro Renewables Source : BP Statistical Review-June 2011
PRIMARY ENERGY CONSUMPTION (MTOE) - INDIA Year 2005 Fuel 2005 % 2010 % Oil 116 30 156 29 Gas 33 8 56 11 1% 5% 30% Oil Gas coal Nuclear Coal 213 56 278 53 56% 8% Hydro Renewables Nuclear 4 1 5 1 Year 2010 Hydro 22 5 25 5 1% 5% 1% Renewables - - 5 1 Total 387 100 524 100 29% Oil Gas coal Nuclear 53% 11% Hydro Renewables Source : BP Statistical Review-June 2011
INDIA A MAJOR GAS/LNG CONSUMER 13th largest gas consumer 70 BCM (~190 MMSCMD) 6th largest LNG importer 16 BCM (~44 MMSCMD) Economy increasing at CAGR of 7-8% p.a. with similar increase in Energy Consumption Share of Natural Gas in Indian Energy basket to increase from 11% to 20% by 2025 Despite increase in domestic gas productiondependency on imported gas to increase substantially Pipeline network- developing into a national grid- needs to grow faster, connecting new markets
CURRENT GAS DEMAND & DOMESTIC SUPPLY SCENARIO 600 500 400 (Bcf/day) (MMSCMD) Demand Supply 385 (13.6) 434 (15.3) 488 (17.2) 550 (19.4) 300 305 (10.8) 200 100 243 155 (5.5) (8.6) 192 (6.8) 198 203 (7.0) (7.2) 240 215 (8.5) (7.6) 0 2011-12 2012-13 2013-14 2014-15 2015-16 2019-20 Demand Mercados Analysis, 2011 Supply Directorate General of Hydrocarbons (DGH)
SECTOR WISE PROJECTED GAS DEMAND Gas Demand (MMSCMD) Source : Mercados Analysis, 2011
LARGE DEMAND BUT SENSITIVE TO PRICE Gas demand and supply, 2015 Mmscmd, at customer gate prices 388 59 230 276 311 171 25 19 2010 year end consumption 1 2 3 4 Price of $16-17/ mmbtu Low Price of $13-14/ mmbtu Medium Price of $11-12/ mmbtu High Price of $8-10 mmbtu Potential demand, 2015 Sectors with demand Industries CNG transport Refineries Industries Power cogen Peaking power plants Baseload power New fertilizer plants Imports Prices at Crude of $ 100/Bbl Domestic supplies 1 Based on estimated LNG supply of 8 mtpa in 2015 including RasGas (7.5 mtpa) and 1.5 mtpa from Gorgon LNG in 2015 SOURCE: Indianpetro; DGH; Company annual reports; Expert interviews; McKinsey analysis
LNG IN INDIA Hydrocarbon Vision 2025 envisaged a GDP growth of 5-6% for the E&P sector along with demand supply scenario of oil & gas in the Country Current GDP growth of 7 9% translate into overall energy demand growth at CAGR of 7.50% Given India s growing energy requirements & unlikelihood of matching increase in the domestic supplies, despite some significant oil & gas finds recently, the import dependence is only going to accentuate sharply in the coming years LNG Regas Capacities Presently, India s LNG import capacity around 13.5 Mmtpa through 2 terminals & meeting approx. 20% of total gas supply of the country
PETRONET LNG LIMITED Incorporated on April 2, 1998 Authorized Capital Rs. 1200 crores (USD 240 Million), Paid up capital Rs. 750 crores (USD 150 Million) Commencement of Commercial Operations - April, 2004 Equity 50% held by Oil & Gas PSUs (ONGC, IOC, BPCL & GAIL ) 10% held by GDFI (part of GDF SUEZ) 5.20% ADB
TOWARDS THE VISION Vision Business Strategy To be a key energy provider to the nation by leveraging unique position in the LNG value-chain with international presence Revenue grew 31.5% EBITDA growth 23% 16320 Revenue Pursue synergistic business opportunities Continue excellence in LNG business - Focus on higher capacity utilization and better operational efficiencies 13197 12000 - Diversify LNG sources 10649 10000 8429 8000 Diversify business - 6555 5509-4000 2000 EBIDTA 14000 6000 Create and manage worldworld-class LNG infrastructure (All Values in INR) 18000 16000 685 920 978 944 1284 1452-0 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 (9 Months) Gas-based power generation Venture into city-gas distribution/ direct marketing to far-flung consumers Solid cargo port at Dahej Maintain highest standards of business ethics
TOWARDS THE VISION Vision Business Strategy To be a key energy provider to the nation by leveraging unique position in the LNG value-chain with international presence Revenue grew 31.5% EBITDA growth 23% 3264 Revenue Pursue synergistic business opportunities Continue excellence in LNG business - Focus on higher capacity utilization and better operational efficiencies 2639 EBIDTA 2500 2130 2000 1500 Create and manage worldworld-class LNG infrastructure (All Values in USD) 3500 3000 - Diversify LNG sources 1686 1102 1311-1000 500 Diversify business - 137 184 196 189 257 290 0-2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 (9 Months) Gas-based power generation Venture into city-gas distribution/ direct marketing to far-flung consumers Solid cargo port at Dahej Maintain highest standards of business ethics
DAHEJ LNG TERMINAL Located at West Coast, State of Gujarat in the Gulf of Cambay Commencement of Operations in 2004 Capacity (Mmtpa) : 5.0 10.0 Truck Loading facility can handle 2500 loadings/ yr. LNG Cargoes unloaded : 845 (March 12, 2012) Further capacity expansion to 15 Mmtpa Second Jetty Regas & Storage Capacity Pre Project Activities started : Under Construction : DFR Completed
DAHEJ LNG STORAGE TANKS
DAHEJ REGAS FACILITIES WITH AIRAIR-HEATER
LNG TRUCK LODING FACILITIES DAHEJ WEIGH BRIDGE VAPORISATION FACILITIES
KOCHI LNG TERMINAL LNG Terminal located in Special Economic developer status Capacity 2.5 Zone with Co- 5.0 Mmtpa Tied up 1.44 MMTPA LNG from Exxon Mobil s Gorgon Project Two Storage Tanks being constructed by IHI, Japan Regasification Facilities being constructed by CTCI, Taiwan Marine Facilities being constructed by Afcons Infrastructure Ltd Progress on schedule, overall completion 94.5%, scheduled commissioning by end 3rd Qtr., 2012
KOCHI TERMINAL 21
KOCHI STORAGE TANK
KOCHI - MARINE FACILITIES
NEW THIRD TERMINAL AT EAST COAST Proposed Capacity: 5 Mmtpa Location: Gangavaram, Andhra Pradesh Regasification Scheme: Indirect Fluid using ambient air heater PFR Completed DFR under preparation Estimated Project cost: Rs.4500 Crores (USD 900 Million) Gangavaram
INTEGRATED POWER PLANT AT DAHEJ & KOCHI Proposed power plants of 3x356 MW-ISO (total 1068 MW CCGT) with improved performance, the expected output is 1200 MW Fuel requirement of 1.0~1.1 Mmtpa LNG for each Plant Implementation schedule 12~15 months for pre-development activities 33 months for construction and commissioning DFR for a 1200 MW Power Plant completed for Dahej Land Identification at Kochi under progress Power project to harness cold energy from LNG Terminal
DIRECT MARKETING Petronet exploring opportunities to supply LNG to Coastal area consumers through small LNG Vessels in India and neighbouring countries Direct Marketing by focusing on the following areas: Signed HOAs with bulk end consumers in Power, Refineries & Fertilizers Sectors LNG/LCNG supplies through Trucks, to LNG hubs, Satellite Stations at customer s premises in regions not serviced by pipelines
BUSINESS MODEL Robust Model LNG supply contract with RasGas, Qatar & Exxon Mobil, Australia Gas Sales Agreement with GAIL, IOCL & BPCL back to back with SPA Time Charter Agreement with established consortium Entire Fuel cost pass through including exchange rate Location Proximity to LNG suppliers Most competitive LNG transportation cost Proximity to Customers HBJ, DUPL and GSPC network in Gujarat
FINANCING Very strong parentage and a robust business model Financing cost is amongst the lowest in the Industry With the use of effective hedging techniques, the Company has been able to maintain a low cost of debt service even in such turbulent times The average cost of debt is 9.06% p.a. in rupee terms
PERFORMANCE GRAPH Sales/ Service TBTU Net Worth (Rs. Crores) 500 4000 440 450 400 413 3493 3500 400 3000 350 322 290 300 2682 321 2500 2236 247 250 1983 2000 1619 200 1500 150 100 50 0 1274 125 1072 1000 500 0 879
PERFORMANCE GRAPH Net Worth USD Million Sales/ Service TBTU 800 500 699 440 450 400 413 700 400 600 536 350 322 290 300 247 250 321 500 447 397 400 324 200 150 300 125 214 200 100 50 0 255 100 0 176
PERFORMANCE GRAPH Turnover Rs. Crores PAT Rs. Crores 18000 900 16320 812 800 16000 14000 13197 700 620 12000 10649 600 518 475 500 10000 8429 6555 5509 6000 3837 4000 2000 0 405 400 8000 1945 313 300 195 200 100 0-100 -28
PERFORMANCE GRAPH Turnover USD Million PAT USD Million 3500 3264 180 162 160 3000 2639 140 124 2500 2130 120 104 2000 1686 95 100 81 1500 1311 80 63 1102 60 1000 767 39 40 500 389 20 0 0-6 -20
PERFORMANCE BASED ON EMPLOYEE PARAMETERS 2010-11 2009-10 2008-09 No. of Employees 276 273 256 Turnover/ employees (USD Million) 9.76 7.96 6.72 Profit Before Tax / Employee (USD Million) 0.67 0.45 0.62 3.37% 3.41% 2.53% Employee Remuneration cost as % of Profit) Total no. of employees : 296 Training & Development : 6 Mandays / Employee Average Age: 34 years (58% employee in 31-40 years of age) 63% of employees are Graduates or Post Graduates Average years of association of employees with Company 5 years Attrition rate 2010-11 : 4.34% Note: Exchange rate @ Rs49/- per USD
FINANCIAL PARAMETERS Earning Per Share (INR) 12.00 10.83 10.00 8.27 8.00 6.33 6.00 4.00 6.91 5.39 4.17 2.00 0.00 2006-07 Year 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 (9 Months) 2007-08 EPS (INR) 4.17 6.33 6.91 5.39 8.26 10.83 2008-09 2009-10 P/E 23.99 11.15 11.62 5.75 15.19-2010-11 2011-12 (9 months) D/E Ratio 1.08 0.97 1.15 1.12 1.20 1.03
FINANCIAL PARAMETERS Earning Per Share (USD) 0.25 0.22 0.20 0.17 0.15 0.13 0.10 0.14 0.11 0.08 0.05 0.00 2006-07 Year 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 (9 months) 2007-08 EPS (USD) 0.08 0.13 0.14 0.11 0.17 0.22 2008-09 2009-10 P/E 23.99 11.15 11.62 5.75 15.19-2010-11 D/E Ratio 1.08 0.97 1.15 1.12 1.20 1.03 2011-12 (9 months)
SHAREHOLDERS WEALTH CREATION As on Mar, 31 2004 2005 2006 2007 2008 2009 2010 Mkt. Price INR 27 46 62 47 73 40 82 2011 Current 123 162.60 Mkt Price (INR) 180 162.60 160 140 123 120 100 80 60 40 20 46 62 82 73 47 40 27 0 2004 2005 2006 2007 2008 2009 2010 2011 Current
SHAREHOLDERS WEALTH CREATION As on Mar, 31 2004 2005 2006 2007 2008 2009 2010 2011 Current USD Per Share 0.54 0.92 1.24 0.94 1.46 0.80 1.64 2.46 3.25 Mkt Price USD 3.50 3.25 3.00 2.50 2.46 2.00 1.64 1.50 1.46 1.24 1.00 0.50 0.94 0.92 0.80 0.54 0.00 2004 2005 2006 2007 2008 2009 2010 2011 Current
FINANCING STRUCTURE (INR CRORES) Particulars Dahej Kochi 2nd Berth Dahej Terminal Terminal Dahej Expansion Total Shareholders Fund Equity Capital/Internal accruals/premium 1015 1260 281 930 3486 Debt 2435 2940 655 2170 8200 Total Means of Finance 3450 4200 936 3100 11686 The existing debt equity ratio is 1.03 : 1; providing enough room to leverage Balance Sheet for new projects in future.
FINANCING STRUCTURE (USD MILLIONS) Particulars Dahej Kochi 2nd Berth Terminal Terminal Dahej Dahej Expansion Total Shareholders Fund Equity Capital/ Internal Accruals/ Premium 203 252 56 186 697 Debt 487 588 131 434 1640 690 840 187 620 2337 Total Means of Finance The existing debt equity ratio is 1.03 : 1; providing enough room to leverage Balance Sheet for new projects in future.
Petronet LNG India Ranking Financial Express (FE 500) Business Standard (BS 1000) 70 84 82 82 60 80 58 48 50 78 Rank Rank 40 76 74 30 73 20 72 10 70 0 68 2009 2010 Year 2009 2010 Year
PETRONET LNG GLOBAL RANKING A latest study by the Plimsoll Global Analysis on Global Crude Oil & Gas Extraction Industry among 1000 largest companies around the world, ranked Petronet LNG as: 150th Largest Company 301th most Profitable Company
CSR -THE JOURNEY HAS JUST BEGUN TOWARDS AN INCLUSIVE SOCIETY - DAHEJ Participative community development programmes with GIDC Luvara & Lakhigam villages CODEGAZ, the CSR arm of our strategic partner GDF Suez supports our cause. Health & Sanitation Potable drinking water/water harvesting/laying of water pipelines/ Storm water drainage. Preventive and Social medicine aids (includes primary health centre). Education and Employment generation programs Construction of School, Scholarship & Vocational Training. Sponsorship of differently abled children of Tamanna School & inauguration of Petronet LNG Centre for Vocational Rehabilitation. Indirect employment for local villagers in the area of Housekeeping & Horticulture. Community Development Renovation of personal facility & fencing at Panchayat office of Luvara Village, Gujarat. Govt. Development Schemes (Kanya Kelvani, Beti Bachao) & Devp. Distt Civic Centre.
CSR - THE JOURNEY HAS JUST BEGUN TOWARDS AN INCLUSIVE SOCIETY - KOCHI Developing Infrastructure Facilities at RMP Todu Canal Kalamukhi Junction Rehabilitation Area in Puthuvypeen Renovation of Building of UPES Government School, Puthuvypeen Distributed uniforms, water bottles & note books to all the 112 students of UPES Government School, Puthuvypeen Conducted Eye Screening & Cataract Operation Camp for Puthuvypeen & neigbouring villages (768 Screenings, 26 operations) Sponsoring of local events like boat race, cultural and sports events in schools Health Camp being planned for the local population of Puthuvypeen
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