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| 8-K - HELIX ENERGY SOLUTIONS GROUP, INC. FORM 8-K 5-4-10 - HELIX ENERGY SOLUTIONS GROUP INC | form8-k.htm |
Changing the way you succeed.
May 4, 2010
Credit Suisse
18th Annual Offshore Technology Conference
18th Annual Offshore Technology Conference
Changing the way you succeed.
Forward-Looking Statements
2
This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Securities Exchange Act of 1934. All such statements, other than statements of
historical fact, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of
1995, including, without limitation, any projections of financial items; future production volumes, results of
exploration, exploitation, development, acquisition and operations expenditures, and prospective reserve levels of
properties or wells; any statements of the plans, strategies and objectives of management for future operations; any
statements concerning developments, performance or industry rankings; and any statements of assumptions
underlying any of the foregoing. These statements involve certain assumptions we made based on our experience
and perception of historical trends, current conditions, expected future developments and other factors we believe
are reasonable and appropriate under the circumstances. The forward-looking statements are subject to a number
of known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially.
The risks, uncertainties and assumptions referred to above include the performance of contracts by suppliers,
customers and partners; employee management issues; uncertainties inherent in the exploration for and
development of oil and gas and in estimating reserves; complexities of global political and economic developments;
geologic risks, volatility of oil and gas prices and other risks described from time to time in our reports filed with the
Securities and Exchange Commission (“SEC”), including the Company’s Annual Report on Form 10-K for the year
ended December 31, 2009. You should not place undue reliance on these forward-looking statements which speak
only as of the date of this presentation. We assume no obligation or duty and do not intend to update these forward-
looking statements except as required by the securities laws.
1933 and Section 21E of the Securities Exchange Act of 1934. All such statements, other than statements of
historical fact, are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of
1995, including, without limitation, any projections of financial items; future production volumes, results of
exploration, exploitation, development, acquisition and operations expenditures, and prospective reserve levels of
properties or wells; any statements of the plans, strategies and objectives of management for future operations; any
statements concerning developments, performance or industry rankings; and any statements of assumptions
underlying any of the foregoing. These statements involve certain assumptions we made based on our experience
and perception of historical trends, current conditions, expected future developments and other factors we believe
are reasonable and appropriate under the circumstances. The forward-looking statements are subject to a number
of known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially.
The risks, uncertainties and assumptions referred to above include the performance of contracts by suppliers,
customers and partners; employee management issues; uncertainties inherent in the exploration for and
development of oil and gas and in estimating reserves; complexities of global political and economic developments;
geologic risks, volatility of oil and gas prices and other risks described from time to time in our reports filed with the
Securities and Exchange Commission (“SEC”), including the Company’s Annual Report on Form 10-K for the year
ended December 31, 2009. You should not place undue reliance on these forward-looking statements which speak
only as of the date of this presentation. We assume no obligation or duty and do not intend to update these forward-
looking statements except as required by the securities laws.
References to quantities of oil or gas may include amounts we believe will ultimately be produced, but that are not
classified as “proved reserves” under SEC definitions. Statements of oil and gas reserves are estimates based on
assumptions and may be imprecise. Investors are urged to consider closely the disclosure regarding reserves in our
2009 Form 10-K.
classified as “proved reserves” under SEC definitions. Statements of oil and gas reserves are estimates based on
assumptions and may be imprecise. Investors are urged to consider closely the disclosure regarding reserves in our
2009 Form 10-K.
Changing the way you succeed.
Historical Profile
• Deepwater subsea contracting
• Deepwater well intervention
• Robotics
• Oil and gas
• Deepwater
• Shelf
• Offshore production facilities
• Shelf contracting (Cal Dive)
• Reservoir evaluation and consulting
The Future
• Deepwater contracting services
• Well Intervention
• Robotics
• Subsea Construction
•Offshore production facilities
The result: A company focused on
deepwater activities and a conservative balance sheet
deepwater activities and a conservative balance sheet
Helix ESG: Transforming the Business Model
3
Changing the way you succeed.
4
Global CAPEX Growth Forecast
Source: Quest Offshore Resources Subsea Database, February 2010
US$26.6bn
US$80.2bn
201% Increase
Changing the way you succeed.
Production Facilities
Marco Polo TLP (50%)
Independence Hub Semi (20%)
Helix Producer I (~82%) (2010)
Subsea
Construction
Construction
Pipelay
Intrepid
Express
Intrepid
Express
Caesar- new to fleet
ROV
40 ROVs
2 ROV Drill Units
6 Chartered Vessels
40 ROVs
2 ROV Drill Units
6 Chartered Vessels
5 Trenchers (200 - 2000hp)
Well Intervention
Q4000
Seawell
Well Enhancer
Normand Clough (JV)
Mobile VDS/SILs
Helix Oil & Gas
GOM shelf and deepwater
PV-10 $1.3 billion @
12/31/2009 (SEC pricing)
12/31/2009 (SEC pricing)
Proved reserves = 578 bcfe
(12/31/2009)
(12/31/2009)
2010 projected production
45-55 bcfe
45-55 bcfe
Helix ESG Business Segments
5
Changing the way you succeed.
Services For Each Stage of the Field Life Cycle
6
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MODU DP3 Q4000
MSV DP3 Well Enhancer
Helix provides well operation and decommissioning services with the Seawell riserless well
intervention vessel, the flagship Q4000 semisubmersible, the Well Enhancer wireline / slickline /
coiled tubing intervention vessel, and the Normand Clough (JV) with our Subsea Intervention
Lubricator and Vessel Deployment systems.
intervention vessel, the flagship Q4000 semisubmersible, the Well Enhancer wireline / slickline /
coiled tubing intervention vessel, and the Normand Clough (JV) with our Subsea Intervention
Lubricator and Vessel Deployment systems.
MSV DP2 Normand Clough
MSV DP2 Seawell
Well Intervention Assets
7
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DP Reel Lay Vessel
Express
Express
DP S-Lay Vessel
Caesar
Caesar
DP Reel Lay Vessel
Intrepid
Intrepid
Caesar’s onboard pipe welding and testing
capability allows the vessel to lay virtually
unlimited lengths of pipe up to 36” in diameter.
capability allows the vessel to lay virtually
unlimited lengths of pipe up to 36” in diameter.
Helix’s dual-reel pipelay and subsea construction
vessel has established an extensive track record
of field installation projects around the world.
vessel has established an extensive track record
of field installation projects around the world.
Intrepid has the flexibility to be deployed as a
pipelay, installation or saturation diving vessel.
pipelay, installation or saturation diving vessel.
Subsea Construction Vessels
8
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Contracting Services Facilities
Ingleside, Texas shore base facility
– Pipe stalk length 5,230 feet
– Onsite subsea component fabrication
– 300’ x 700’slip can accommodate two
Helix Subsea Construction vessels side
by side
Helix Subsea Construction vessels side
by side
– Constructed Helix’s Danny 36-mile
8 x 12-inch pipe-in-pipe, including
jumpers and manifolds
8 x 12-inch pipe-in-pipe, including
jumpers and manifolds
Aerial view of Ingleside Shore Base
Helix Danny pipe-in-pipe welding
On-site fabrication capabilities
9
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Helix is an industry leading provider of ROV and subsea trenching services
to deepwater operators worldwide.
to deepwater operators worldwide.
The Helix ROV fleet consists
of 40 vehicles, covering the
spectrum of deepwater
construction services.
of 40 vehicles, covering the
spectrum of deepwater
construction services.
The 600 hp Supertrencher II
system is designed to
operate at water depths in
excess of 6,500 feet.
system is designed to
operate at water depths in
excess of 6,500 feet.
The state of the art I-Trencher
system trenches, lays pipe up
to 16” in diameter, and backfills
in a single operation.
system trenches, lays pipe up
to 16” in diameter, and backfills
in a single operation.
Helix ROV Systems
10
Changing the way you succeed.
Island Pioneer
Olympic Triton
Olympic Canyon
Seacor Canyon
Normand Fortress
Chartered support vessels allows Helix to adjust the size and capability of its
fleet to cost-effectively meet industry demands.
fleet to cost-effectively meet industry demands.
ROV/Construction Support Vessel Fleet
11
Normand Clough
as part of CloughHelix JV
as part of CloughHelix JV
Changing the way you succeed.
12
Helix Producer I FPU
• On location at Green Canyon
Block 237
Block 237
• Recovering buoy into the
turret and quick connect /
disconnect function planned
for testing and acceptance by
USGC starting May 4th
turret and quick connect /
disconnect function planned
for testing and acceptance by
USGC starting May 4th
• Flowlines and export
pipelines have been
hydrostatically tested and gas
pipeline has been dewatered
and packed with Nitrogen
pipelines have been
hydrostatically tested and gas
pipeline has been dewatered
and packed with Nitrogen
• First production scheduled for
Q2 2010
Q2 2010
Changing the way you succeed.
Oil & Gas
13
Changing the way you succeed.
Helix Oil and Gas
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12/31/2009 Reserve Profile:
• 578 Bcfe
• ≈ 60% Deepwater GOM
• ≈ 40% proved developed
• ≈30% Oil
• PV-10 $1.3 billion (SEC)
• PV-10 $2.7 billion (forward strip price)
Production Profile:
• Current production of 135-140 mmcfe/d*
• 35% of production is oil
• >65% of production is deepwater, and growing
New 2010 Production (net)
• Danny oil- 5,000 boe/d
• Noonan- 50+ mmcfe/d
• Phoenix- 8,000 - 10,000 boe/d
* As of April 2010
Changing the way you succeed.
Oil and Gas Deepwater Profile
15
• Internal Prospect Generation via Large,
In-House 3-D Seismic Library
In-House 3-D Seismic Library
• Large, Recent Long Offset 3-D Seismic
Database,+1,500 Blocks
Database,+1,500 Blocks
• Experienced Exploration/Drilling/Operations
Team - 25+ years avg.
Team - 25+ years avg.
• 22 Defined Prospects, Helix is operator of 21
• Majority of Prospects, if successful, are Sub
Sea Tie-Backs
Sea Tie-Backs
• Multiple, low risk prospects on or near
existing Helix operated infrastructure
existing Helix operated infrastructure
Helix Oil and Gas specializes in prospect
generation, acquisition, exploration, development
and production, employing its own key services
and methodologies and working to lower finding
and development costs relative to industry norms.
generation, acquisition, exploration, development
and production, employing its own key services
and methodologies and working to lower finding
and development costs relative to industry norms.
Changing the way you succeed.
Caesar departing for sea trials, Nantong, China
16
2010 Outlook
Changing the way you succeed.
2010 Outlook
17
• Contracting Services demand in 2H 2010 expected to rebound
o Well intervention activity has already increased and expected to continue in 2010
o Subsea Construction activity expected to pick up around mid-year
o Relatively large intercompany utilization to subside in Q2
• Capital expenditures of approximately $220 million planned for 2010
o $87 million relates to completion of major vessel projects
o Oil and Gas capital expenditures of approximately $100 million, excluding P&A of
approximately $61 million
approximately $61 million
Changing the way you succeed.
2010 Outlook
18
|
Broad Metrics
|
2010 Higher End
|
2010 Lower End
|
2009
|
|
Production Range
|
55 Bcfe
|
45 Bcfe
|
44 Bcfe
|
|
EBITDA
|
$500 million
|
$400 million
|
$490 million
|
|
CAPEX
|
$220 million
|
$220 million
|
$328 million
|
|
Commodity Price
Deck |
2010 Higher End
|
2010 Lower End
|
2009
|
|
|
Hedged
|
Oil
|
$80.05 / bbl
|
$77.65 / bbl
|
$67.11 / bbl
|
|
Gas
|
$5.69 / mcf
|
$5.89 / mcf
|
$7.75 / mcf
|
|
Changing the way you succeed.
Helix Summary
19
Changing the way you succeed.
Key Balance Sheet Metrics
20
Debt (A)
Liquidity (B) of $598 million at 3/31/10
(A) Includes impact of debt discount under our Convertible Senior Notes.
(B) Defined as available revolver capacity ($386 million) plus cash ($212 million).
Changing the way you succeed.
Liquidity and Capital Resources
Credit Facilities, Commitments and Amortization
– $435 Million Revolving Credit Facility - UNDRAWN.
• Facility extended to November 2012.
• In July 2011, commitments reduced to $410 million.
• $50 million of LCs in place.
– $415 Million Term Loan B - Committed facility through June 2013. $4.3 million
principal payments annually.
principal payments annually.
– $550 Million High Yield Notes - Interest only until maturity (January 2016) or called
by Helix. First Helix call date is January 2012.
by Helix. First Helix call date is January 2012.
– $300 Million Convertible Notes - Interest only until put by noteholders or called by
Helix. First put/call date is December 2012, although noteholders have the right to
convert prior to that date if certain stock price triggers are met ($38.56).
Helix. First put/call date is December 2012, although noteholders have the right to
convert prior to that date if certain stock price triggers are met ($38.56).
– $119 Million MARAD - Original 25 year term; matures February 2027. $4.4 million
principal payments annually.
principal payments annually.
21
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Financial Information
22
Express spooling pipe at Ingleside Shore Base, Gulf of Mexico
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Note: Excludes Cal Dive and Helix RDS revenues from 2005-2009.
See Non-GAAP reconciliations on slides 27-29.
See Non-GAAP reconciliations on slides 27-29.
($ amounts in millions)
$575
$840
$1,071
$1,337
$1,152
Consistent Top-Line Growth
23
Changing the way you succeed.
- 2006 results exclude the impact of
the gain on sale in the Cal Dive IPO
and estimated incremental
overhead costs during the year.
the gain on sale in the Cal Dive IPO
and estimated incremental
overhead costs during the year.
- 2007 results exclude the impact of
the Cal Dive gain, impairments and
other unusual items.
the Cal Dive gain, impairments and
other unusual items.
- 2008 results exclude non-cash
charges of $964 million for
reduction in carrying values of
goodwill and certain oil and gas
properties.
charges of $964 million for
reduction in carrying values of
goodwill and certain oil and gas
properties.
- 2009 results exclude the impact of
Cal Dive gains, impairments and
other unusual items.
Cal Dive gains, impairments and
other unusual items.
(a) See Non-GAAP reconciliations on slides 27-29.
Earnings Per Share (a)
24
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-2006 results exclude the impact
of the gain on sale in the Cal
Dive IPO and estimated
incremental overhead costs
during the year.
of the gain on sale in the Cal
Dive IPO and estimated
incremental overhead costs
during the year.
-2007 results exclude the impact
of the Cal Dive gain,
impairments and other unusual
items.
of the Cal Dive gain,
impairments and other unusual
items.
-2008 results exclude non-cash
impairments.
impairments.
-2009 results exclude non-cash
impairments and impact of Cal
Dive gains.
impairments and impact of Cal
Dive gains.
(a) See Non-GAAP reconciliations on slides 27-29.
($ amounts in millions)
$278
$449
$490
$575
$609
Significant Cash Generation - EBITDAX
25
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Non-GAAP
Reconciliations
Reconciliations
26
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Non-GAAP Reconciliations
27
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Non-GAAP Reconciliations
28
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Non-GAAP Reconciliations
29
Changing the way you succeed.
30