2. www.polarcus.com 2
Disclaimer
This Presentation of Polarcus Limited (the “Company”) has been prepared solely for information purposes. This Presentation may not be
distributed, reproduced or used without the consent of the Company.
The information contained herein does not purport to contain all information concerning the Company. No party has made any kind of
independent verification of any of the information set forth herein, including any statements with respect to projections or prospects of the
business or the assumptions on which such statements are based. The Company nor any of its subsidiaries make any representations or
warranty, express or implied, as to the accuracy, reliability or completeness of this Presentation or of the information contained herein and shall
have no liability for the information contained in, or any omissions from, this Presentation.
Included in this Presentation are various “forward-looking statements”, including statements regarding the intent, opinion, belief or current
expectations of the Company or its management. Such forward-looking statements are not guarantees of future performance and involve known
and unknown risks, uncertainties and other factors that may cause the actual results, performance and outcomes to be materially different from
any future results, performance or outcomes expressed or implied by such forward-looking statements, including, among others, risks or
uncertainties associated with the Company’s business, segments, development, growth management, financing, market acceptance and
relations with customers, and, more generally, general economic and business conditions, changes in domestic and foreign laws and
regulations, taxes, changes in competition and pricing environments, fluctuations in currency exchange rates and interest rates and other
factors, including lack of operating history. Should one or more of these risks or uncertainties materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those described in this document.
No information contained herein constitutes, or shall be relied upon as constituting, any advice relating to the future performance of the
Company. The Company undertakes no obligation to publicly update or revise any forward-looking statements included in this Presentation.
4. www.polarcus.com 4
Polarcus in brief
• Seven high-end 3D seismic vessels ~11% market share
• Youngest most uniform fleet in industry
• 500+ professionals and global presence
• State of the art technology with complete broadband solution
• Specialized Arctic and low environmental impact offerings
• Clear strategy for delivering and delevering
• Listed on Oslo Børs Main List – Market Cap USD ~400 million
2008 2009 2010
Polarcus
launched
2008
20122011
Polarcus Asima in operation offshore west Greenland
5. www.polarcus.com 5
Highlights H1 2013
• A company in growth
– Revenues of USD 275.3 million, up 28% from H1 2012
– EBITDA of USD 104.0 million, up 51% from H1 2012
– EBIT of USD 57.9 million, up 84% from H1 2012
– Net Cash Flow from operating activities of USD 130.5 million,
up 39% from H1 2012
• Strengthening the balance sheet
– Sale of Polarcus Samur to TPAO with a long term
collaboration arrangement
– Reduced average interest rate to 7.1% through refinancing
• Strong operational performance
– Technical downtime < 5%
10. www.polarcus.com 10
15
30 30 30 30 30 30 303
6 7 7 9 12
120
125
95
40
35
H2-13 2014 2015 2016 2017 2018 2019 2020
Bank debt Sale leaseback USD 125m CB
USD 95m bond NOK 230m bond USD 35m CB
Robust balance sheet
10
110
(repurchasing
The vessels is
Optional)
• Long term fleet bank facility with fixed
interest of 5.6%
• New USD 95m bond with 8% interest to
refinance:
– USD 60 million 2nd lien 2011/2016 bond with
12.5% interest
– USD 35 million 2008/2013 Convertible bond
with 8.5% interest
• Improved terms on sale- lease back
from 12% to 10.8% implied interest rate
• Average interest rate reduced to 7.1%
New debt maturity profile
11. www.polarcus.com 11
Update on lawsuit filed by WesternGeco
• On 15 August 2013 WesternGeco filed a lawsuit in Texas, USA, for alleged
US patent infringement against Polarcus US Inc. and Polarcus Limited
• Applies to four method and apparatus patents for streamer steering and
positioning related to the DigiFIN™ lateral streamer control systems
purchased from ION Geophysical Corporation
• Polarcus believes that it has strong and valid defenses
– Polarcus' activities have not and do not infringe the US Patents
– Serious doubt as to whether US courts have jurisdiction over Polarcus
• Polarcus is confident that the lawsuit will not disrupt operational activities
12. www.polarcus.com 12
Polarcus share information
• Listed on the Oslo Stock
Exchange
• Market Cap USD ~400 million
• Included in the OBX and
OSEBX indices from June 2013
• ~2500 shareholders
• Free float ~85%
Shareholder Share %
ZICKERMAN HOLDING LT 40,571,476 8.00
VARMA MUTUAL PENSION 23,648,025 4.66
ZICKERMAN GROUP LTD 23,178,081 4.57
LOCAL TAPIOLA MUTUAL 21,600,000 4.26
SEB PRIVATE BANK S.A 16,284,410 3.21
VERDIPAPIRFONDET DNB 15,189,948 2.99
JP MORGAN CLEARING C 12,798,472 2.52
SKANDINAVISKA ENSKIL 11,855,191 2.34
EUROCLEAR BANK S.A./ 11,444,816 2.26
GOLDMAN SACHS & CO E 11,103,192 2.19
CLEARSTREAM BANKING 10,449,768 2.06
OYSTER 10,427,100 2.06
BLKRCK GLBL SMALLCAP 9,013,991 1.78
VERDIPAPIRFONDET DNB 8,100,000 1.60
STATE STREET BANK & 6,758,158 1.33
BNP PARIBAS SEC. SER 6,402,843 1.26
BNP PARIBAS SEC. SER 6,100,000 1.20
TVETERAAS EIENDOMSSE 5,673,362 1.12
SKANDINAVISKA ENSKIL 5,465,934 1.08
RAIFFEISEN BANK INTE 5,200,000 1.03
Top 20 Shareholders 261,264,767 52%
Other shareholders 245,931,412 48%
Total 507,196,179 100%
Top 20 Shareholders (as per 26 Aug)
14. www.polarcus.com 14
Operational performance
• Technical downtime < 5% for Q2
• Completion of 12 month Woodside
project in Q2 (~22,000 sq.km in 11
months)
– Production record of >2900sq.km
in 30 days
• Deflector upgrade to reduce drag
and increase streamer spread
– Currently operating 10 long
streamers with 150m separation or
1350 m lateral spread
• Polarcus Naila back in solid
production after 1 month off hire in
Q3 13 due to thruster replacement
End August
Polarcus Naila
Polarcus Nadia
Polarcus AlimaPolarcus Amani
Polarcus Adira
Polarcus Samur
Current vessel locations
Vessel under Management
Polarcus Asima
15. www.polarcus.com 15
Polarcus Nadia & Naila propulsion upgrade
• Polarcus Nadia and Naila are the only vessels with thruster units in the PLCS fleet.
• Upgrade to Berg Propulsion Twin Fin™ conventional straight shaft is planned for H1 and H2 2014
• CAPEX of MUSD 10 per vessel
• 6 weeks at yard per vessel
• Significant improvement in fuel efficiency and bollard pull
• Upgrade to full 12 streamer capability
Prefabrication Installation Completion
16. www.polarcus.com 16
Multi-client library in the making
• MC Project Library now ~ 25,000 km² 3D data
• Established a new ‘core area’ in the UK
Southern Gas Basin in Q2 ‘13
– Strong revenues forecast for Q4 following the 27th
Round second tranche
• E.ON announced the largest UK gas basin
discovery for many years in Q3 ‘13
– Tolmount discovery on southern flank of core area
– Highly positive for exploration interest
• Project library NBV at USD 73.3 million end Q2
E.ON Tolmount
gas discovery
‘Catcher’ Projects
~6,100 sq. km
‘Ravenspurn’ Projects
~5,400 sq. km
17. www.polarcus.com 17
Global 3D Seismic Fleet Capacity
201320142015
60 60 61 62
0
10
20
30
40
50
60
70
2012 2013 2014 2015
Excludes COSL (3 vessels) & Sinopec (1 vessel)
• Estimated seismic fleet growth 2013 – 2015 net
2% YOY assuming vessel retirement
• Lead time for new build capacity traditionally
between 24 – 36 months
• Further fleet retirement expected as >20% of
the global 3D fleet is older than 20 years
* Vessel name may vary though are based on Polarcus interpretation
of peer groups fleet retirement plans.
Estimated seismic fleet growth
No. Vessels Company Vessel Streamer cap.
1 PGS Ramform Titan 16
1 Dolphin Sanco Swift 12
1 PGS Ramform Atlas 16
-1 Reflect Geowave Comander -8
-1 CGG Geo Barents -6
-1 Western Geco Western Patriot -8
0 Net growth 22
1 Dolphin Sanco Sword 12
1 Western Geco Amazon 1 16
1 Western Geco Amazon 2 16
-1 Western Geco Western Pride* -8
-1 PGS Pacific Explorer* -8
1 Net growth 28
1 PGS Ramform Opt 1 16
1 Dolphin Super Duke 16
1 PGS Ramform Opt. 2 16
-1 PGS Atlantic Explorer* -8
-1 CGG Artemis Arctic -6
1 Net growth 34
18. www.polarcus.com 18
Robust E&P demand
• Robust E&P growth expected
YOY for the coming few years
• Marine seismic representing ~
3% of Global Offshore E&P
spend
• Seismic demand projected to
grow ~10 % YOY 2013 – 2015
• Current oil price well within the
comfort zone for continued E&P
spending 0
20
40
60
80
100
120
140
2007 Report 2008 Report 2009 Report 2010 Report 2011 Report 2012 Report 2013
USD/bbl Comfort zone Brent crude oil
Source: DNB Markets
19. www.polarcus.com 19
Global seismic outlook
Russian Arctic: Rosneft &
Gazprom awarded extensive
acreage
Australasia: Strong outlook
for Myanmar, current
industry issues with permits
in Australia normalizing
West Africa: Continued high activity
with further growth potentials,
Namibia, Angola, Gabon and S Africa
South America: Significant activity in
Uruguay and Falklands and new
activity firming up in Brazil.
North America: Increased focus
from Supermajors and new WAZ
surveys in Nova Scotia
Central America: Strong activity in
Caribbean and northern S America
(Suriname, Guyana)
Mediterranean: Activity
in Med and Black Sea
Polarcus vessels
NW Europe: Consistent high
activity for MC and Contract
behind active license rounds
East Africa: Oil-majors
planning large surveys
Vessels under management
20. www.polarcus.com 20
0
5,000
10,000
15,000
20,000
25,000
2012 2013 2014 2015 2016 2017 2018
3Dinkm²
Black Sea
Far East
Arctic
Projected increasing due to:
- New licensing
- Correction of existing
exploration plans
Russia 3D market outlook 2013-18
• Russian Arctic ~ 4 x the size of Gulf of
Mexico
• Significantly improved tax regime
accelerates interest
• Super majors partnering with Rosneft
& Gazprom
• Russian Arctic potentially holds ~ 10X
the BOE of the US GOM
• Russia is expected to absorb ~ 10% of
the global fleet seasonally from 2014
1,500,000
354,000
74,700
R U S S I A N L I C E N C E D
A C R A G E Y T D
3 D R E Q U I R E M E N T T O
C O V E R G E O L O G I C A L
S T R U C T U R E S
I N I T I A L 3 D
C O M I T M E N T S 2 0 1 3 -
2 0 1 8
The New Russian offshore 3D Seismic market in km²
km²
Projected 3D
demand
Source: NOC’s and Oil Companies exposed to the region
21. www.polarcus.com 21
Backlog
• USD ~215 million contract backlog*
• Contract backlog secured in the range of
USD 260k-330k/day
• Booked capacity Q3 2013 - 100%
• Booked capacity Q4 2013 - 55%
• Booked capacity Q1 2014 - 30%
* Inclusive of bareboat charter of Vyacheslav Tikhonov to SCF
Received contract tenders in USD million (As of Aug)
-
50
100
150
200
250
300
350
400
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Dec-09
Feb-10
Apr-10
Jun-10
Aug-10
Oct-10
Dec-10
Feb-11
Apr-11
Jun-11
Aug-11
Oct-11
Dec-11
Feb-12
Apr-12
Jun-12
Aug-12
Oct-12
Dec-12
Feb-13
Apr-13
Jun-13
Aug-13
Millions
25. www.polarcus.com 25
RIGHTSIZE RIGHTDESIGN RIGHTPLAN
Polarcus Nadia Polarcus Naila
Type 3D Vessel Type 3D Vessel
Design Ulstein SX124 Design Ulstein SX124
LOA 88.8m LOA 88.8m
Beam 19.0m Beam 19.0m
Streamer cap 12 Streamer cap 12
Speed 14.0 knots Speed 14.0 knots
Ice class ICE-C Ice class ICE-C
Year delivered 2009 Year delivered 2009
Ownership On sale lease back with
purchase option
Ownership On sale lease back with
purchase option
Polarcus Amani Polarcus Adira
Type 3D Vessel Type 3D Vessel
Design Ulstein SX134 Design Ulstein SX134
LOA 92.0m LOA 92.0m
Beam 21.0m Beam 21.0m
Streamer cap 14 Streamer cap 14
Speed 15.0 knots Speed 15.0 knots
Ice class ICE-1A* Ice class ICE-1A*
Year delivered 2012 Year delivered 2012
Ownership 100% Ownership 100%
Polarcus Asima Polarcus Alima
Type 3D Vessel Type 3D Vessel
Design Ulstein SX134 Design Ulstein SX134
LOA 92.0m LOA 92.0m
Beam 21.0m Beam 21.0m
Streamer cap 12 Streamer cap 12
Speed 15.0 knots Speed 15.0 knots
Ice class ICE-1A Ice class ICE-1A
Year delivered 2010 Year delivered 2011
Ownership 100% Ownership 100%
Barbaros Hayreddin Paşa Vyacheslav Tikhonov
Type 3D Vessel Type 3D Vessel
Design Ulstein SX133 Design Ulstein SX133
LOA 84.2m LOA 84.2m
Beam 17.0m Beam 17.0m
Streamer cap 8 Streamer cap 8
Speed 18.0 knots Speed 18.0 knots
Ice class ICE-1A Ice class ICE-1A
Year delivered 2011 Year delivered 2011
Ownership Sold Ownership 100%
Under management
26. www.polarcus.com 26
First
Pass
Wide tow
High
Density
3D
Base-
line 4D
High
density
4D
4D
Monitor
Multi-
vessel
3D
Multi-
vessel
4D
Monitor
Arctic
Operations
Multi
Azimuth
Vessel +
Equipment
Personnel +
Procedures
Acquisition
Portfolio
Broadband Solutions
Polarcus offering
27. www.polarcus.com 27
Awards through RIGHTDESIGN
ICE-1A or 1A* Class1
Safe Arctic operations
1 POLARCUS ASIMA, ALIMA,
SAMUR, SELMA, AMANI & ADIRA
ULSTEIN X-BOW®
Improved efficiency and
reduced emissions Fuel: MGO with low
sulfur content
BWM-T 2
Removal of invasive species from ballast water
2 POLARCUS ASIMA, ALIMA, SAMUR, SELMA, AMANI & ADIRA
IMO Green Passport
Multiple main engines and independent
propellers in case of failure
DYNPOS-AUTR
Systems redundancy
with DP2
CLEAN DESIGN
High specification
exhaust catalysts
Double hull – no oil contact
with outer skin
Bilge water cleaning system to
reduce contaminants to <5ppm
Triple – E™
Environmental &
Energy Efficiency
Sentinel® solid streamers
28. www.polarcus.com 28
Pioneering environmental leadership
DNV’s Triple-E™ is a voluntary environmental
performance rating scheme for ships, independent of
class, age and flag
Key measures of Energy & Environmental Efficiency :
– Environmental management practices
– Fuel efficient operations
– Energy efficient vessel design
– Verifiable monitoring, measurement and
documentation
Triple-E™ has four levels with ‘1’ as the highest
Leading
Sustained
Heightened awareness
Systemized
1
2
3
4
First Triple-E™ ‘Level 1’ in the world
29. www.polarcus.com 29
Debt overview
Debt Security Size
Balance
30 June 2013
Tenure Maturity Interest
Convertible bond Unsecured USD 35m USD 35m 5 years Fully paid Jul-13 8.50%
Unsecured bond Unsecured NOK 230m NOK 230m 3 years Nov-14 14.00%
Unsecured bond Unsecured USD 95m USD 95m 5 years Jun-18 8.00%
Senior secured convertible bond Selma USD 125m USD 125m 5 years Apr-16 2.88%
Sale lease back Nadia & Naila USD 180m USD 165m 10 years Sep-19 ~10.8%
Fleet bank facility
Tranche 1
Asima USD 80m USD 64m 12 years Aug-22 6.20%
Fleet bank facility
Tranche 2
Alima USD 55m USD 46m 12 years Mar-23 5.10%
Fleet bank facility
Tranche 3
Amani USD 114m USD 105m 12 years Mar-24 5.60%
Fleet bank facility
Tranche 4
Adira USD 114m USD 109m 12 years Jun-24 5.60%
30. www.polarcus.com 30
Potential Arctic oil and gas resources
• The region within the Arctic circle covers
6% of the worlds surface, though a
USGS study estimated that the Arctic
could hold about 20% of the world’s
undiscovered but recoverable oil and
natural gas resources.
• Russia is estimated to hold more than
half of the total Arctic resources
Potential Arctic oil and gas resources: 84% is
estimated to be offshore
Source: E&Y calculations from US DOE and USGS data
31. www.polarcus.com 31
Attractiveness of Russian Arctic
• The new offshore tax regime represents a major break-through in Russian oil sector
• Specific tax rate has been reduced from 87% to 5 - 15% in the Arctic; guaranteed for
10 – 15 years – making the IRR very attractive for the oil companies even at a
moderate oil price.
Attractiveness of Arctic opportunities by country
32. www.polarcus.com 32
New offshore tax regime in Russia
• Offshore taxation represents a major break-
through in Russian oil sector taxation. The
overall marginal oil & gas specific tax rate
has reduced from 87% for brownfields to
5%-30% for offshore projects, depending on
the area.
• With the new tax regime, it is believed that
the Russian offshore projects can generate
IRRs exceeding 25% (depending on oil
price assumptions), which looks competitive
compared with the global deep-water
average of 24% for other regions.
• While it is too early to say whether there are
any commercial development opportunities
in Russian offshore, the area looks
extremely promising given the interest from
international majors and the fact that it is a
geological continuation of the West Siberian
oil province, where some of the world’s
largest fields were discovered.
