Strategy + KPIs
A clear strategy to create exploration-led growth
Ophir’s vision is to be the leading international oil and gas exploration and production company.
Ophir is focused on finding resource and monetising it to create value for shareholders.
Key elements of the strategy:
Value creation through exploration
- Building a series of options for future drilling. Acquiring new acreage in the bottom of the cycle with no drilling commitments. Mature and high grade these plays, drilling only those that offer shareholders material returns on investment.
Active portfolio management
- Transacting at the most appropriate time to create value for shareholders.
- Realising value from existing assets and adding new assets to the portfolio that have ability to generate material returns on capital employed.
Focus on capital allocation and returns
- Target is to derisk the business model through funding core exploration activity from operating cash flow. Apply prudent levels of debt to development and production activity and preserve balance sheet strength and flexibility.
- Only allocate capital to highest return opportunities following rigorous risk reward analysis. We are focused on cash balances and cost management and will seek to manage the risk profile through farm-outs, exits etc.
Key performance indicators
We continue to measure our success on the resource we add, the ability to achieve this at the economic rates and to do it as safely as possible.
2015 three-year average finding cost
The basis of the finding cost calculation is straightforward. Expenditure on exploration and appraisal activity is divided by contingent resources added in the year. This number increased in 2015 relative to previous years as we were not successful with any of our play opening wells. However, this rate still compares favourably to our international peer group.
The rate of turnover relates to employees who have left the Company voluntarily during the year. The figure excludes employees who left as a direct result of redundancy or dismissal on the grounds of poor performance.
Turnover rates were lower than in the previous year. Turnover has remained within manageable levels and has not had a negative impact upon technical disciplines. Recruitment levels remained consistent across all areas of the business. Ophir continues to be able to attract high calibre staff.
The Company aims to monitor and reduce turnover rates and will continue to provide highly competitive pay and benefits to attract and retain key personnel.
2C Contingent Resources (mmboe)
The Company has a large contingent resource base. Importantly the majority of these resources are cost advantaged and therefore remain commercially viable in the current commodity price environment. We expect to convert a significant proportion of these resources to reserves in 2016.
Total Recordable Incident Rate (TRIR) (incidents/million man-hours worked)
Lost Time Incident Frequency Rate (LTIF) (incidents/million man-hours worked)
The health, safety and welfare of people working for and on behalf of Ophir’s business underpins everything the Company does. Ophir’s health and safety culture is based on individual responsibility and commitment from the very top of the Company.
Accountability rests with every employee, including management and senior executives, who uphold their obligations through the active management of Ophir’s health and safety agenda.
The acquisition of Salamander Energy early in 2015 resulted in a large increase in man-hours worked during 2015. Although the number of man-hours is nearly double the previous year, the 2015 TRIR rate recorded was 0.83, which puts Ophir into the top quartile of safety performance (Company and contractor personnel included) according to the IOGP survey data. We are very proud of this superior HSE performance and will continue to put the health, safety and welfare of those working for and on behalf of Ophir at the top of the agenda on how Ophir does business.