Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2...

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1 Investor Presentation March, 2014

Transcript of Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2...

Page 1: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Investor Presentation March, 2014

Page 2: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Disclaimer

Safe harbor statement under the US Private Securities Litigation Reform Act of 1995.

This document contains statements that YPF believes constitute forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995.

These forward-looking statements may include statements regarding the intent, belief, plans, current expectations or objectives of YPF and its management,

including statements with respect to YPF’s future financial condition, financial, operating, reserve replacement and other ratios, results of operations, business strategy, geographic concentration, business concentration, production and marketed volumes and reserves, as well as YPF’s plans, expectations or objectives with respect to future capital expenditures, investments, expansion and other projects, exploration activities, ownership interests, divestments, cost savings and dividend payout policies. These forward-looking statements may also include assumptions regarding future economic and other conditions, such as future

crude oil and other prices, refining and marketing margins and exchange rates. These statements are not guarantees of future performance, prices, margins, exchange rates or other events and are subject to material risks, uncertainties, changes and other factors which may be beyond YPF’s control or may be difficult to predict.

YPF’s actual future financial condition, financial, operating, reserve replacement and other ratios, results of operations, business strategy, geographic concentration, business concentration, production and marketed volumes, reserves, capital expenditures, investments, expansion and other projects, exploration activities, ownership interests, divestments, cost savings and dividend payout policies, as well as actual future economic and other conditions, such

as future crude oil and other prices, refining margins and exchange rates, could differ materially from those expressed or implied in any such forward-looking statements. Important factors that could cause such differences include, but are not limited to, oil, gas and other price fluctuations, supply and demand levels, currency fluctuations, exploration, drilling and production results, changes in reserves estimates, success in partnering with third parties, loss of market share, industry competition, environmental risks, physical risks, the risks of doing business in developing countries, legislative, tax, legal and regulatory developments, economic and financial market conditions in various countries and regions, political risks, wars and acts of terrorism, natural disasters, project delays or advancements and lack of approvals, as well as those factors described in the filings made by YPF and its affiliates with the Securities and Exchange Commission, in particular, those described in “Item 3. Key Information—Risk Factors” and “Item 5. Operating and Financial Review and Prospects” in YPF’s

Annual Report on Form 20-F for the fiscal year ended December 31, 2012 filed with the US Securities and Exchange Commission. In light of the foregoing, the forward-looking statements included in this document may not occur.

Except as required by law, YPF does not undertake to publicly update or revise these forward-looking statements even if experience or future changes make it

clear that the projected performance, conditions or events expressed or implied therein will not be realized.

These materials do not constitute an offer for sale of YPF S.A. bonds, shares or ADRs in the United States or otherwise.

Page 3: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Agenda

Company overview 1

Recent performance 2

Financial considerations 3

Page 4: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Shareholder structure 1 Board composition

Argentine government 2

Argentine government “Series A”

Repsol

Free float

51.0% 37.09%

11.9%

0.01%

Ratings

B-

AA (Arg)

Markets

YPFD YPF

(2) In exercise of the rights derived

from the Repsol shares subject to

expropriation in accordance with Law

26,741 y art. 57 published in the

Official Gazzette on May 7, 2012

(1) As of 12/31/13

Designated by the

Provinces

Mr. Nagel

Mr. Ivovich

Mr. Cretini

Mr. Félix

Mr. Ortiz

Independent

Mr. Valle

Mr. Brizuela

Mr. Uchitel

Mr. Piacentino

Company

Executives

Mr. Dasso

Mr. Cuesta

Mr. Arceo

Chairman of the Board,

Mr. Galuccio

Shares Class A

Mr. Kicillof Labor Union

Representative

Mr. Soloaga

Designated by Repsol

Mr. García del Río

Mr. Tombeur

Caa1

Ba1 (Arg)

Corporate Governance

Page 5: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Sales 1

US$ 16,514 mm

EBITDA 1 2

US$ 4,297 mm

Net income 1 2

US$ 1,041 mm

Employees 6

17,747

Exploration

and production

• Production 4: 232 Kbbl/d of crude oil, 48 Kbbl/d of NGL and 33.9 Mm3/d of natural gas

• Proved Reserves 3 4 in 2013: 628 mm bbl of liquids and 455 mm boe of gas

• Unique unconventional opportunities: Vaca Muerta, Lajas, Pozo D-129

Downstream -

refining

and logistics

• Total refining Capacity: 320 Kbbl/d 5 6 (more than 50% 6 of Argentina’s total capacity)

• High level of conversion and complexity

• Nearly 2,700 km 6 of crude oil and 1,801 km 6 of refined products pipeline

Downstream -

petrochemicals • The petrochemical business is integrated with the rest of the production chain

• Output Capacity: 2.2 6 mm ton per annum

Downstream -

marketing

• The country’s leading company in fuel marketing (56.5% 6 market share in diesel and

gasoline)

• 1,542 6 7 service stations

Major Affiliates • MEGA: Liquids separation and a fractioning plant

• Refinor: Refining, transportation and marketing of refined products

• Profertil: Leads the fertilizer production and wholesale business,

producing urea and ammonia

• AESA: Engineering, manufacturing, construction, operating

and maintenance services to power and energy companies

Leading Integrated Energy Co. In Argentina

(1)YPF financial statements values in IFRS converted to US$ using 2013 average FX of 5.5. (2) Considers non recurrent results for 2Q 2013, not including a non cash provision of

855 MARS relating to claims arising from discontinuity of gas export contracts to Brazil in 2009. (3) Includes oil, condensates and liquids; converted using 1 boe = 5.615 mm cf of

gas as per 20-F 2012. (4) As of FY 2013 financial statements (5) Does not includes 50% of Refinor (13 kbbl/d). (6) Company Data, 2013. (7) Excludes 71 Refinor service

stations.

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Integrated across value chain

/ As of December 2013

Oil

business

Natural gas

business

Production figures refer to YPF in Argentina only

Production

231 Kbbl/d Refining

278 Kbbl/d

Domestic

market

Domestic market

71% Domestic prices (gasoline, diesel)

17% International prices (FO, bunker, jet fuel,

petrochemicals, lubricants, LPG and others)

88%

12% Exports International prices

(naphtha, LPG, jet fuel, crude, petrochemicals,

fuel oil, soybean oil and meal and others)

7 Kbbl/d

217 Kbbl/d

Purchases

61 Kbbl/d

Imports (Gas purchased

by ENARSA)

+ Purchases

+

Domestic

market

Exports 0.2%

99%

Residential

+ CNG

Industrial

Power

plants

58% 16%

26%

Upstream

34 mm m3/d

Export

market

7 Kbbl/d

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Source: Company Data, 2013

(1) Company Data, 2013 – (2) Includes international reserves of 1.2 MBOE

YPF has 90 concessions in the most productive Argentine basins

(total reserves 1P: 1,083 mm boe1) and 52 exploration blocks

in the country (48 onshore and 4 offshore) 1 Proved reserves: 71 mm boe

% liquids: 98%

% gas: 2%

Production: 8.1 mm boe

Cuyana

Proved reserves: 57 mm boe

% liquids: 16%

% gas: 84%

Production: 8.5 mm boe

Noroeste

Proved reserves: 288 mm boe

% liquids: 83%

% gas: 17%

Production: 42.2 mm boe

Golfo San Jorge

Proved reserves: 86 mm boe

% liquids: 24%

% gas: 76%

Production: 6.1 mm boe

Austral

Proved reserves: 580 mm boe

% liquids: 48%

% gas: 52%

Production: 115.7 mm boe

Neuquina 2013

Proved reserves 2 Production share

Liquids

58%

Gas

42%

Total: 1,083 mm boe Total: 466 mm boe

Pan American

17%

Wintershall

6%

Apache

4%

Others

12%

Sinopec

4%

Tecpetrol

2%

Chevron

San Jorge

2%

Total Australl

6% Petrobras

6%

YPF

37%

Pluspetrol

4%

Source: IAPG, as of December 2013

Upstream - Significant Potential with Leading Market Position

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NEUQUINA

GOLFO

SAN JORGE

AUSTRAL

CUYANA

NOROESTE

4,4

Unconventional opportunities

Notes:

K: thousand; M: million; B: billion (109)

CHACO

PARANAENSE

Other Opportunities

Pozo D-129 (shale oil / tight oil)

Vaca Muerta (shale oil / gas)

Lajas (tight gas)

Noroeste - Tarija

Los Monos (shale gas)

Noroeste - Cretaceous

Yacoraite (shale / tight oil & gas)

Chaco Paranaense

Devonian – Permian (shale oil)

Cuyana

Cacheuta (shale oil)

Potrerillos (tight oil)

Austral

Inoceramus

Neuquina

Mulichinco (tight oil / gas)

Los Molles (shale / tight gas)

Agrio (shale oil)

Golfo San Jorge

Neocomiano (shale oil / gas)

Tested & Producing

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Description

Area 30,000 km2

Gross

Shale oil & gas Vaca Muerta

Area 12,075 km2

Net YPF

Oil 77%

Wet gas 5%

Dry gas 18%

Windows 1

Oil

Wet

gas

Dry

gas

TOC (%)

Thickness (mts)

Reservoir pressure (psi)

3-10

30-450

4,500-9,500

4-5

60-90

3,000-4,000

0.5-4

60-90

7,000-12,000

2-12

10-60

2,000-5,500

3-5

30-100

2,500-8,500

12

20-30

4,200

Source: SPE, Wood Mackenzie and YPF data.

Encouraging results

(1) Estimated over YPF net acreage

Vaca Muerta Barnett Haynesville Marcellus Eagle Ford Bakken

Vaca Muerta Unconventional Formation

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

55000

0 1 2 3 4 5 6 7 8 9 10 11 12

Production month

Cu

mu

lati

ve

oil

pro

du

cti

on

, b

bl

2011 Avg (15 wells)

2012 Avg (10 wells)

2013 Avg (103 wells)

Avg West Sweet Spot (10 wells)

Type well EUR 293 Kbbl

D 16,000 bbl

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Downstream - solid market leadership

Source: 20-F 2012 – (1) YPF owns 50% of Refinor (not operated) – (2) As of December 2012

Proved reserves: 85 M boe

% liquids: 98

% gas: 2

Production: 8.8 M boe

Capacity: 105,5 kbbl/d

Luján de Cuyo refinery A

Proved reserves: 85 M boe

% liquids: 98

% gas: 2

Production: 8.8 M boe

Capacity: 189 kbbl/d

La Plata refinery B

Capacity: 25 kbbl/d

Plaza Huincul refinery C

Capacity: 26,1 kbbl/d

Refinor(1)

D

C

D

B

Terminals

Products pipeline

Oil pipeline

A

(3) Cumulative December 2013

Gasoline 3 Diesel 3

Crude Processing 2 No. of Gas Stations 2

55%

15%

9%

13%

8%

34%

15% 12%

11%

28%

55%

19%

6%

14%

6%

58%

13%

5%

14%

10%

Others Others

Others

Others

Market Share Breakdown (%)

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-

200

400

600

800

1.000

1.200

1.400

1.600

1.800

2011-12 2013-17 2018-22

-

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

2011-12 2013-17 2018-22

• 250 wells

• + 29% production

• 251 Mbbl

• 5,380 wells

• + 23% production

• 1.27 TCF

• 1,160 wells

Notes: Mbbl: Million barrels /

Tcf: Trillion cubic feet

Primary

Production Oil

Natural

Gas

Shale oil

Others

Secondary

Recovery

46%

8%

14%

32%

Shale gas

32%

Tight gas

27%

Others

8%

Infill

33%

Upstream plan

Exploitation

Exploration

MUSD

Capex

x2 ,

,

,

,

,

MUSD

x7

,

,

,

,

,

2013-17 2013-17

2013-17 2013-17

,

,

,

Page 12: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Downstream plan

Capex Refined products increase 2013 - 2017

Refining complex expansion and upgrading

Gasoline

Diesel

6% 3% 10%

8% 18%

5%

18%

Utilization Capacity Upgrading Conversion

Contribution by project

Light

crude

+ Topping /

vacuum

capacity

+ Alkylation /

reforming

capacity

+ Hydro-

cracking /

coking

capacity

+

Annual CAGR

2013-2017 total increase

Gasoline

Diesel

Total

24%

44%

37%

5.6%

9.5%

8.1%

,

,

,

,

,

0

200

400

600

800

1.000

1.200

1.400

1.600

1.800

2011-2012 2013-2017

MUSD x1.7

2013-17

Page 13: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Agenda

Company overview 1

Recent performance 2

Financial considerations 3

Page 14: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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16,485

29,848

2012 2013

Upstream Downstream Others

Activity

Doubled investments during 2013

ARS Millions

Significant increase in activity

Drilling Rigs

Workover

25

46

65

2011 2012 sep-13

49

70

85

2011 2012 sep-13

160%

73%

+81.1%

Capex

Page 15: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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46.9

41.3 38.1

34.2 33.4 31.4 33.0 35.6 35.5

2008 2009 2010 2011 2012 Q1 13 Q2 13 Q3 13 Q4 13

256.8

244.9 240.9

222.6 227.4 226.3 228.2

235.1 239.3

2008 2009 2010 2011 2012 Q1 13 Q2 13 Q3 13 Q4 13

Crude oil production (kbbl/d) Natural gas production (Mm3/d)

Production

Reverted downward trend in production seen in recent years

Page 16: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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979

1,083

2012 2013

590

628

2012 2013

389

455

2012 2013

Reserves

(1) Approximately 6.5 Mboe were transferred to Consolidated Entities as a result of YPF Energía Eléctrica working interest on Ramos Field. These rights were previously owned by

former Pluspetrol Energy and thus disclosed under Equity-accounted Entities reserves.

+6.4% +17.0% +10.6%

Boosted proved reserves by 10.6%.

Solid results coming from secondary recovery projects, tight gas and shale formations.

158% RRR 137% RRR 185% RRR

Total Hydrocarbon (Mboe) Liquids (Mbbl) Natural Gas (Mboe)

Page 17: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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(1) 395 Km2 / 12,075 Km2

(2) 45 Km2 / 12,075 Km2

Republic of ArgentinaNeuquina Basin

Neuquén Province

Development model

290 Km2 (71,661 acres)

Directional wells upside

105 Km2 (25,946 acres)

Pilot consisting of 130 wells

and US$1.24 bn

Full program of ~1,500 wells

(US$15 bn+)

• Estimated oil production:

+ 50 Kbbl/d

• Estimated gas production:

3 mm m3/d

0.37% of total YPF’s VM

acreage 2

Initial investment of US$188 mm

16 wells to be drilled

YPF Operates

Loma Campana (395 km2 - 97,607 acres) Objective: Vaca Muerta Shale Oil with Chevron

El Orejano (45 km2 - 11,090 acres) Objective: Vaca Muerta Shale Gas with Dow

Total Gross Production (Kboe/d)

3.3% of total YPF’s

VM acreage 1

Rincón del Mangrullo (183 km2 - 45,200 acres) Objective: Mulichinco Tight Gas with Petrolera Pampa

YPF Operates

1st stage

• 40 km2 of 3D seismic

• 34 wells to be drilled

2snd stage

• 15 wells to be drilled

YPF Operates

JV Partners: Chevron, Dow and Petrolera Pampa

5.9 7.9

9.8 13.3

17.3

Q4 12 Q1 13 Q2 13 Q3 13 Q4 13

Page 18: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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8,029 8,098

2012 2013

4,133 4,545

2012 2013

Crude processed (kbbl/d) Gasoline sales (Km3)

+10%

Downstream

Strong local demand and stable market share even with lower crude processed

due to the La Plata Refinery incident

Diesel sales (Km3)

+0.9%

288 278

2012 2013

-3.5%

Page 19: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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3,902

5,681

2012 2013

18,053

29,394

2012 2013

7,903

12,015

2012 2013

Financial Results

+52.0% +62.8% +45.6%

Production and sales volume growth, coupled with pricing discipline, led to solid

financial results and healthy margins.

Recurring results exclude 855 MARS impact of non cash provision relating to claims arising from discontinuity of gas export contracts to Brazil in 2009.

Recurring Operating Income

(ARS million)

Recurring Net Income

(ARS million)

Recurring EBITDA

(ARS million)

Page 20: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Agenda

Company overview 1

Recent performance 2

Financial considerations 3

Page 21: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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4,747

10,713

20,964

7,203

-22,201

Cash at the end of 2012

Cashflow from operations

Net financing Capex Cash at the end of 2013 (1)

(2)

In million of ARS

Notes Amount Interest Rate Maturity

Series XXIV

(Q4 2013) USD 150M Libor + 7.5% 58 months

Series XXV

(Q4 2013) ARS 300M

BADLAR +

3.24% 18 months

Series XXVI

(Q4 2013) USD 500M 8.875% 60 months

Series XXVII

(Q4 2013) ARS 150M

19% +

margin 18 months

Series XXVII

(Q4 2014) ARS 500M

BADLAR +

0% 72 months

Series XXVII

(Q1 2014) ARS 379M

BADLAR +

3.5% 21 months

FY 2013 Financial Situation

• Issued ARS 7.6 bn and USD 650 million in 2013; increased cash to ARS 10.7 bn

• Average life of debt of 3.5 years; Peso denominated debt at 41% of total; average interest

rates of 6.1% in USD and 21.5% in ARS

• Maintained solid capital structure

(1) Includes effect of changes in exchange rates / (2) Effective spendings in fixed assets acquisitions net of revenues from asset sales of 5,351 MARS.

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Financial overview - consolidated balance sheet

Balance sheet Year 2013 (ARS million)

Year 2012 (ARS million)

VAR % 2013/2012

Cash & ST investments 10,713 4,747 126%

Fixed assets 93,496 56,971 64%

Other assets 31,386 18,231 72%

Total assets 135,595 79,949 70%

Loans 31,890 17,104 86%

Liabilities 55,465 31,585 76%

Total Liabilities 87,355 48,689 79%

Shareholders’ equity 48,240 31,260 54%

Source: YPF financial statements

Page 23: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Financial overview - consolidated income statement (*)

Income

statement

12 months

2013 (ARS million)

12 months

2012 (ARS million)

VAR % 12m 2013/2012

Q4 2013 (ARS million)

Q4 2012 (ARS million)

VAR % Q4 2013 /

Q4 2012

Net sales 90,113 67,174 34% 25,294 18,862 34%

Operating income 11,160 7,903 41% 3,820 1,846 107%

EBITDA 1 23,446 16,184 45% 7,322 4,064 80%

Net income 5,125 3,902 31% 1,918 1,019 88%

Source: YPF financial statements (1) EBITDA = Net Income + Depreciation of Fixed Assets + Amortization of Intangible Assets

Page 24: Investor Presentation - YPF · 4 Shareholder structure 1 Board composition Argentine government 2 Argentine government “Series A” Repsol Free float 51.0% 37.09% 11.9% 0.01% Ratings

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Investor Presentation March, 2014