UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2001
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ____________ to ____________
COMMISSION FILE NUMBER: 1-11675
TRITON ENERGY LIMITED
(Exact name of registrant as specified in its charter)
CAYMAN ISLANDS NONE
- ---------------------------- -------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification No.)
organization)
CALEDONIAN HOUSE, JENNETT STREET, P.O. BOX 1043, GEORGE TOWN, GRAND CAYMAN,
CAYMAN ISLANDS
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code: (345) 949-0050
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Number of Shares
Title of Each Class Outstanding at July 25, 2001
Ordinary Shares, par value $0.01 per share 38,188,937
-------------------------------
TRITON ENERGY LIMITED AND SUBSIDIARIES
INDEX
PART I. FINANCIAL INFORMATION PAGE NO.
--------
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Item 1. Financial Statements
Condensed Consolidated Statements of Operations -
Three and Six months ended June 30, 2001 and 2000 2
Condensed Consolidated Balance Sheets -
June 30, 2001 and December 31, 2000 3
Condensed Consolidated Statements of Cash Flows -
Six months ended June 30, 2001 and 2000 4
Condensed Consolidated Statement of Shareholders' Equity -
Six months ended June 30, 2001 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 15
Item 3. Quantitative and Qualitative Disclosures about Market Risk 29
PART II. OTHER INFORMATION
Item 4. Submission of Matters for Vote of Security Holders 30
Item 6. Exhibits and Reports on Form 8-K 31
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
TRITON ENERGY LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------- --------------------
2001 2000 2001 2000
-------- -------- --------- ---------
<s> <c> <c> <c> <c>
Oil and gas sales $123,745 $ 69,790 $267,628 $144,124
Costs and expenses:
Operating 25,066 14,137 58,768 29,882
General and administrative 5,736 5,774 12,119 10,349
Depreciation, depletion and amortization 26,440 12,303 59,421 26,275
-------- -------- --------- ---------
57,242 32,214 130,308 66,506
-------- -------- --------- ---------
Operating income 66,503 37,576 137,320 77,618
Interest income 721 2,014 2,232 4,791
Interest expense, net (6,970) (4,087) (14,426) (8,837)
Other income (expense), net 1,676 522 (394) (520)
-------- -------- --------- ---------
(4,573) (1,551) (12,588) (4,566)
-------- -------- --------- ---------
Earnings before income taxes and cumulative
effect of accounting change 61,930 36,025 124,732 73,052
Income tax expense 23,077 13,319 48,840 23,979
-------- -------- --------- ---------
Earnings before cumulative effect of
accounting change 38,853 22,706 75,892 49,073
Cumulative effect of accounting change --- --- 1,212 (1,345)
-------- -------- --------- ---------
Net earnings 38,853 22,706 77,104 47,728
Accumulated dividends on preference shares 7,252 7,339 14,505 14,680
-------- -------- --------- ---------
Earnings applicable to ordinary shares $ 31,601 $ 15,367 $ 62,599 $ 33,048
======== ======== ========= =========
Average ordinary shares outstanding 37,474 36,225 37,462 36,060
======== ======== ========= =========
Basic earnings per ordinary share:
Earnings before cumulative effect of
accounting change $ 0.84 $ 0.42 $ 1.64 $ 0.95
Cumulative effect of accounting change --- --- 0.03 (0.04)
-------- -------- --------- ---------
Net earnings $ 0.84 $ 0.42 $ 1.67 $ 0.91
======== ======== ========= =========
Average diluted shares outstanding 59,443 59,275 59,378 59,084
======== ======== ========= =========
Diluted earnings per ordinary share:
Earnings before cumulative effect of
accounting change $ 0.65 $ 0.38 $ 1.28 $ 0.83
Cumulative effect of accounting change --- --- 0.02 (0.02)
-------- -------- --------- ---------
Diluted earnings $ 0.65 $ 0.38 $ 1.30 $ 0.81
======== ======== ========= =========
See accompanying Notes to Condensed Consolidated Financial Statements.
TRITON ENERGY LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
(UNAUDITED)
<s> <c> <c>
JUNE 30, DECEMBER 31,
2001 2000
----------- -----------
Current assets:
Cash and equivalents $ 63,139 $ 136,361
Trade receivables 33,867 25,616
Other receivables 7,996 11,032
Advances for equipment 78,799 16,791
Inventories, prepaid expenses and other 27,043 18,811
----------- -----------
Total current assets 210,844 208,611
Property and equipment, at cost, less accumulated depreciation
and depletion of $601,037 for 2001 and $542,776 for 2000 753,686 687,511
Investment in affiliates 195,024 190,430
Deferred income taxes and other assets 107,062 107,728
----------- -----------
$1,266,616 $1,194,280
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt $ 133 $ 4,648
Accounts payable and accrued liabilities 140,827 140,700
----------- -----------
Total current liabilities 140,960 145,348
Long-term debt, excluding current maturities 500,019 500,048
Deferred income taxes 30,081 17,108
Other liabilities 7,277 6,760
Shareholders' equity:
8% preference shares, stated value $70.00 362,619 362,672
Ordinary shares, par value $0.01 375 374
Additional paid-in capital 521,004 534,480
Accumulated deficit (293,051) (370,155)
Accumulated other non-owner changes in shareholders' equity (2,668) (2,355)
----------- -----------
Total shareholders' equity 588,279 525,016
Commitments and contingencies (note 8) --- ---
----------- -----------
$1,266,616 $1,194,280
=========== ===========
The Company uses the full cost method to account for its oil and gas producing
activities.
See accompanying Notes to Condensed Consolidated Financial Statements.
TRITON ENERGY LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 2001 AND 2000
(IN THOUSANDS)
(UNAUDITED)
<s> <c> <c>
2001 2000
---------- ----------
Cash flows from operating activities:
Net earnings $ 77,104 $ 47,728
Adjustments to reconcile net earnings to net cash provided
by operating activities:
Depreciation, depletion and amortization 59,421 26,275
Amortization of deferred income --- (8,814)
Cumulative effect of accounting change (1,212) 1,345
Deferred income taxes and other 12,594 6,468
Changes in working capital pertaining to
operating activities (67,956) (6,813)
---------- ----------
Net cash provided by operating activities 79,951 66,189
---------- ----------
Cash flows from investing activities:
Capital expenditures and investments (134,087) (74,398)
Purchase of affiliate --- (88,800)
Other (234) 128
---------- ----------
Net cash used by investing activities (134,321) (163,070)
---------- ----------
Cash flows from financing activities:
Payments on long-term debt (4,584) (4,529)
Issuances of ordinary shares under stock compensation plans 904 10,935
Dividends paid on preference shares (14,507) (14,682)
Other (456) (1,735)
---------- ----------
Net cash used by financing activities (18,643) (10,011)
---------- ----------
Effect of exchange rate changes on cash and equivalents (209) (180)
---------- ----------
Net decrease in cash and equivalents (73,222) (107,072)
Cash and equivalents at beginning of period 136,361 186,323
---------- ----------
Cash and equivalents at end of period $ 63,139 $ 79,251
========== ==========
See accompanying Notes to Condensed Consolidated Financial Statements.
TRITON ENERGY LIMITED AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 2001
(IN THOUSANDS)
(UNAUDITED)
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OWNER SOURCES OF SHAREHOLDERS' EQUITY:
8% PREFERENCE SHARES:
Balance at December 31, 2000 $ 362,672
Conversion of 8% preference shares (53)
----------
Balance at June 30, 2001 362,619
----------
ORDINARY SHARES:
Balance at December 31, 2000 374
Issuance of shares 1
----------
Balance at June 30, 2001 375
----------
ADDITIONAL PAID-IN CAPITAL:
Balance at December 31, 2000 534,480
Issuances under stock compensation plans 903
Conversion of preference shares 53
Cash dividends (14,505)
Other, net 73
----------
Balance at June 30, 2001 521,004
----------
TOTAL OWNER SOURCES OF SHAREHOLDERS' EQUITY 883,998
----------
NON-OWNER SOURCES OF SHAREHOLDERS' EQUITY:
ACCUMULATED DEFICIT:
Balance at December 31, 2000 (370,155)
Net earnings 77,104 $77,104
----------
Balance at June 30, 2001 (293,051)
----------
ACCUMULATED OTHER NON-OWNER CHANGES IN SHAREHOLDERS' EQUITY:
Balance at December 31, 2000 (2,355)
Cumulative effect of accounting change 2,934 2,934
Changes in fair value of contracts (3,207) (3,207)
Reclassification adjustments to earnings for settled contracts (40) (40)
---------- --------
Comprehensive income $76,791
========
Balance at June 30, 2001 (2,668)
----------
TOTAL NON-OWNER SOURCES OF SHAREHOLDERS' EQUITY (295,719)
----------
TOTAL SHAREHOLDERS' EQUITY AT JUNE 30, 2001 $ 588,279
==========
See accompanying Notes to Condensed Consolidated Financial Statements.
TRITON ENERGY LIMITED
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(AMOUNTS IN TABLES IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
1. GENERAL
Triton Energy Limited is an international oil and gas exploration and production
company. Our principal properties, operations, and oil and gas reserves are
located in Colombia, offshore Equatorial Guinea and offshore Malaysia-Thailand.
We explore for oil and gas in these areas, as well as in southern Europe, Africa
and the Middle East. Unless this report indicates otherwise or the context
otherwise requires, the terms "we," "our," "us," "Triton" and the "Company" as
used in this report refer to Triton Energy Limited and its subsidiaries and
other affiliates through which Triton conducts its business. All sales prior to
January 2001 were derived from oil and gas production in Colombia. Beginning in
January 2001, sales are derived from oil and gas production in Colombia and oil
production in Equatorial Guinea.
In the opinion of management, our accompanying unaudited condensed consolidated
financial statements contain all adjustments of a normal recurring nature
necessary to present fairly our financial position as of June 30, 2001, and the
results of our operations for the three and six months ended June 30, 2001 and
2000, our cash flows for the six months ended June 30, 2001 and 2000, and
shareholders' equity for the six months ended June 30, 2001. The results for the
six months ended June 30, 2001, are not necessarily indicative of the final
results to be expected for the full year.
The condensed consolidated financial statements should be read in conjunction
with the Notes to Consolidated Financial Statements, which are included as part
of our Annual Report on Form 10-K for the year ended December 31, 2000.
Certain other previously reported financial information has been reclassified to
conform to the current period's presentation.
SUBSEQUENT EVENT - RECENT DEVELOPMENTS
On July 17, 2001, a subsidiary of Amerada Hess Corporation commenced a tender
offer to purchase all of our outstanding ordinary shares for $45 per share.
Amerada Hess' offer is described in detail in a Schedule TO and its exhibits
that Amerada Hess filed with the Securities and Exchange Commission on July 17,
2001.
The tender offer is conditioned upon there being validly tendered, and not
withdrawn, a number of ordinary shares that represents at least 90% in value of
our outstanding ordinary shares on a fully-diluted basis. The tender offer is
also subject to regulatory approvals and other customary conditions, but the
tender offer is not subject to any financing condition. The tender offer is
scheduled to expire at midnight, New York City time, on August 13, 2001, subject
to possible extension.
If the 90% condition is not satisfied, but there are tendered at least a
number of ordinary shares representing a majority of the total number of votes
of the outstanding ordinary shares on a fully-diluted basis, Amerada Hess at its
option may purchase those shares that are tendered. If Amerada Hess terminates
the offer, it may, at its option, require us to seek approval from our
shareholders for a scheme of arrangement pursuant to which all ordinary shares
would be acquired for $45 in cash per ordinary share and all 8% convertible
preference shares would be purchased for $180, plus accrued and unpaid
dividends, in cash per preference share, or it may cease the acquisition
altogether.
The tender offer is being made pursuant to an acquisition agreement we
entered into with Amerada Hess on July 9, 2001, as amended. We also entered into
a principal shareholders agreement with Amerada Hess, HM4 Triton L.P. and
certain affiliates of HM4 Triton L.P. These principal shareholders together hold
ordinary shares and 8% convertible preference shares representing, in the
aggregate, approximately 34% of our outstanding ordinary shares, determined on a
fully-diluted basis. Pursuant to the principal shareholders agreement, the
principal shareholders have agreed to tender their ordinary shares (including
ordinary shares issuable upon conversion of their preference shares) in the
tender offer. In addition, pursuant to the principal shareholders agreement,
subject to specified conditions, if the tender offer expires or is terminated,
Amerada Hess has agreed to purchase, and the principal shareholders have agreed
to sell to Amerada Hess, their shares at the price of $45 per ordinary share and
$180.00 per 8% convertible preference share, plus accumulated and unpaid
dividends. In order to effectuate these transactions, we amended our
shareholders agreement with HM4 Triton, L.P. to provide that if and when Amerada
Hess purchases the principal shareholders' shares pursuant to the terms of the
principal shareholders agreement, Amerada Hess would become entitled to the same
rights and subject to the same restrictions under the shareholders agreement to
which HM4 Triton, L.P. currently is entitled or subject. These rights include,
among others, the right to designate up to four directors to our board of
directors and the right to approve or disapprove of certain major events or
transactions.
If pursuant to the tender offer Amerada Hess owns at least 90% in value of
our ordinary shares, Amerada Hess and we will take all necessary action under
Cayman Islands law to complete a compulsory acquisition of the ordinary shares
not tendered in the tender offer as promptly as practicable following the
completion of the tender offer. The purchase price for the ordinary shares in
the compulsory acquisition would be the same as the price paid in the tender
offer.
If Amerada Hess purchases all of the tendered ordinary shares, there may be
so few remaining holders of publicly held ordinary shares that (a) our ordinary
shares will no longer meet the published guidelines of the New York Stock
Exchange for continued listing and may be delisted from the New York Stock
Exchange, (b) there may not be a public trading market for our ordinary shares,
and (c) we may cease making filings with the Securities and Exchange Commission
or may not be required to comply with the Securities and Exchange Commission
rules relating to publicly held companies.
The foregoing descriptions of the agreements are summaries and do not
purport to be complete and are qualified in their entirety by reference to the
full text of the agreements. The agreements and related agreements, as amended,
are filed as exhibits to our Form 8-K, which was filed with the Securities and
Exchange Commission on July 11, 2001, and Form 8-K/A, which was filed on July
17, 2001. You can review our filings and their exhibits, as well as the filings
of Amerada Hess, at the Securities and Exchange Commission's web site at
http://www.sec.gov. You can also obtain a copy of these filings from the public
reference room of the Securities and Exchange Commission by calling (800)
SEC-0330.
2. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
We adopted Statement of Financial Accounting Standards No. 133 ("SFAS 133"),
"Accounting for Derivative Instruments and Hedging Activities" on January 1,
2001. In accordance with the transition provisions of SFAS 133, we recorded a
net-of-tax cumulative effect gain of $1.2 million to earnings to recognize the
ineffective portion of changes in fair value of hedging positions and the time
value component of option contracts. We also recorded a net-of-tax cumulative
effect gain of $2.9 million to comprehensive income to recognize the fair value
of the effective portion of all derivative instruments designated as cash flow
hedges.
Our oil sales are normally priced with reference to a defined benchmark, such as
West Texas Intermediate spot ("WTI") and Dated Brent. The price we actually
receive will vary from the benchmark depending on quality and location
differentials. As a matter of policy, from time to time we use financial market
transactions, including swaps, collars and options, or combinations of these,
with creditworthy counterparties to reduce risk associated with the pricing of
our oil sales. We may designate certain derivative transactions as cash flow
hedges based on the assessment of the expected effectiveness (as defined by SFAS
133) of the derivative transaction.
For financial and commodity market transactions in which we hedge the
variability of our cash flows associated with our forecasted crude oil sales,
the effective portion of changes in the fair value of the derivative instrument
will be reported in comprehensive income in the period changes in fair value
occur. These gains and losses will be recognized in earnings in the periods in
which the related hedged sale of crude oil occurs. All changes in the value of
derivative instruments not designated as hedges, the ineffective portion of
changes in fair value of hedging transactions and the time value component of
option contracts designated as hedges, will be recognized in earnings in the
period changes in fair value occur. There is no tax effect related to our
derivative activities.
Changes in fair value of derivatives reported in other income (expense), net in
the Condensed Consolidated Statements of Operations is comprised of the
following:
<s> <c> <c>
THREE MONTHS SIX MONTHS
ENDED ENDED
JUNE 30, 2001 JUNE 30, 2001
------------- -------------
Change in fair value of derivatives not designated as hedges $ 1,380 $ 99
Time value portion of cash flow hedges 519 (633)
Ineffective portion of cash flow hedges 207 284
------------- -------------
$ 2,106 $ (250)
============= =============
At June 30, 2001, we had an unrealized loss of $.3 million in accumulated other
nonowner changes in shareholders' equity related to cash flow hedges that will
expire during the next nine months as monthly settlements occur. At June 30,
2001, we recorded an asset of $3.2 million and a liability of $.6 million for
the fair value of our derivative instruments.
3. SEGMENT INFORMATION
Our operations are primarily related to crude oil and natural gas exploration
and production. Our principal properties, operations and oil and gas reserves
are located in Colombia, offshore Equatorial Guinea and offshore
Malaysia-Thailand. Financial information about our operations is presented
below:
<s> <c> <c> <c> <c>
EQUATORIAL CORPORATE
COLOMBIA GUINEA AND OTHER TOTAL
-------- ---------- --------- --------
THREE MONTHS ENDED JUNE 30, 2001:
Oil and gas sales $ 68,470 $ 55,275 $ --- $ 123,745
Operating income (loss) 43,578 27,724 (4,799) 66,503
THREE MONTHS ENDED JUNE 30, 2000:
Oil and gas sales $ 69,790 $ --- $ --- $ 69,790
Operating income (loss) 43,134 (481) (5,077) 37,576
SIX MONTHS ENDED JUNE 30, 2001:
Oil and gas sales $149,915 $ 117,713 $ --- $267,628
Operating income (loss) 92,985 54,291 (9,956) 137,320
SIX MONTHS ENDED JUNE 30, 2000:
Oil and gas sales $144,124 $ --- $ --- $144,124
Operating income (loss) 87,290 (886) (8,786) 77,618
4. ADVANCES FOR EQUIPMENT
One of our directors is the chief executive officer of a company that is
providing us with certain subsea equipment for the development of the Ceiba
field offshore Equatorial Guinea. We had advanced $25.4 million at June 30,
2001, and $16.8 million at December 31, 2000 to the third party under our
current contract.
5. INVENTORIES, PREPAID EXPENSES AND OTHER
<s> <c>
JUNE 30, DECEMBER 31,
2001 2000
----------- -----------
Materials and supplies inventory $ 14,890 $ 7,556
Prepaid expenses 6,197 2,644
Crude oil inventory 2,730 5,011
Other 3,226 3,600
----------- -----------
$ 27,043 $ 18,811
=========== ===========
6. ACCOUNTS PAYABLE AND ACCRUED LIABILITIES
<s> <c> <c>
JUNE 30, DECEMBER 31,
2001 2000
----------- -----------
Accrued exploration and development $ 51,746 $ 58,655
Income taxes payable 32,111 29,877
Dividends payable 14,505 14,507
Taxes other than income 11,349 10,761
Accrued interest payable 10,743 10,498
Litigation and environmental matters 3,622 3,694
Accounts payable, principally trade 3,410 5,402
Other 13,341 7,306
----------- -----------
$ 140,827 $ 140,700
=========== ===========
7. EARNINGS PER ORDINARY SHARE
The following table reconciles the numerators and denominators of the basic and
diluted earnings per ordinary share computation for earnings from continuing
operations for the three and six months ended June 30, 2001 and 2000.
<s> <c> <c> <c>
INCOME SHARES PER-SHARE
(NUMERATOR) (DENOMINATOR) AMOUNT
----------- ------------- ---------
THREE MONTHS ENDED JUNE 30, 2001:
Net earnings $ 38,853
Less: Accumulated dividends on preference shares (7,252)
-----------
Earnings available to ordinary shareholders 31,601
Basic earnings per ordinary share 37,474 $ 0.84
=========
Effect of dilutive securities:
Stock options --- 1,247
8% preference shares 7,252 20,722
----------- -------------
Earnings available to ordinary shareholders
and assumed conversions $ 38,853
===========
Diluted earnings per ordinary share 59,443 $ 0.65
============= =========
THREE MONTHS ENDED JUNE 30, 2000:
Net earnings $ 22,706
Less: Accumulated dividends on preference shares (7,339)
-----------
Earnings available to ordinary shareholders 15,367
Basic earnings per ordinary share 36,225 $ 0.42
=========
Effect of dilutive securities:
Stock options --- 2,306
8% preference shares 7,259 20,744
----------- -------------
Earnings available to ordinary shareholders
and assumed conversions $ 22,626
===========
Diluted earnings per ordinary share 59,275 $ 0.38
============= =========
SIX MONTHS ENDED JUNE 30, 2001:
Earnings before cumulative effect of
accounting change $ 75,892
Less: Accumulated dividends on preference shares (14,505)
-----------
Earnings available to ordinary shareholders 61,387
Basic earnings per ordinary share 37,462 $ 1.64
=========
Effect of dilutive securities:
Stock options --- 1,194
8% preference shares 14,505 20,722
----------- -------------
Earnings available to ordinary shareholders
and assumed conversions $ 75,892
===========
Diluted earnings per ordinary share 59,378 $ 1.28
============= =========
SIX MONTHS ENDED JUNE 30, 2000:
Earnings before cumulative effect of
accounting change $ 49,073
Less: Accumulated dividends on preference shares (14,680)
-----------
Earnings available to ordinary shareholders 34,393
Basic earnings per ordinary share 36,060 $ 0.95
=========
Effect of dilutive securities:
Stock options --- 2,075
8% preference shares 14,519 20,753
5% preference shares 161 196
----------- -------------
Earnings available to ordinary shareholders
and assumed conversions $ 49,073
===========
Diluted earnings per ordinary share 59,084 $ 0.83
============= =========
8. COMMITMENTS AND CONTINGENCIES
For internal planning purposes, our revised capital spending program for the
year ending December 31, 2001, is approximately $385 million, excluding
capitalized interest and acquisitions, of which approximately $318 million
relates to exploration and development activities in Equatorial Guinea, $39
million relates to exploration and development activities in Colombia and $28
million relates to our exploration activities in other parts of the world.
During the normal course of business, we are subject to the terms of various
operating agreements and capital commitments associated with the exploration and
development of our oil and gas properties. Management believes that such
commitments, including the capital requirements in Colombia, Equatorial Guinea
and other parts of the world as discussed previously, will be met without any
material adverse effect on our operations or consolidated financial condition.
See Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations - Liquidity and Capital Requirements.
GUARANTEES
At June 30, 2001, we had guaranteed the performance of a total of $6.6 million
in future exploration expenditures to be incurred in Greece through 2001. This
commitment is backed primarily by an unsecured letter of credit.
LITIGATION
In July through October 1998, eight lawsuits were filed against Triton and
Thomas G. Finck and Peter Rugg, in their capacities as former officers of
Triton. The lawsuits were filed in the United States District Court for the
Eastern District of Texas, Texarkana Division, and have been consolidated and
are styled In re: Triton Energy Limited Securities Litigation. The consolidated
complaint alleges violations of Sections 10(b) and 20(a) of the Securities
Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, in connection with
disclosures concerning our properties, operations, and value relating to a
prospective sale in 1998 of all or a substantial part of our assets. The
lawsuits seek recovery of an unspecified amount of compensatory damages, fees
and costs. The District Court has denied our motion to dismiss the claims. We
believe our disclosures were accurate and intend to vigorously defend these
actions. We cannot assure you that the litigation will be resolved in our favor.
An adverse result could have a material adverse effect on our financial position
or results of operations.
In November 1999, a lawsuit was filed against us, one of our subsidiaries
and Thomas G. Finck and Peter Rugg, in their capacities as former officers of
Triton, in the District Court of the State of Texas for Dallas County. The
lawsuit is styled Aaron Sherman, et al. vs. Triton Energy Corporation et al.
and, as amended, alleges as causes of action fraud, negligent misrepresentation
and violations of the Texas securities fraud statutes in connection with our
1996 reorganization as a Cayman Islands corporation and disclosures concerning
our prospective sale of all or a substantial part of our assets announced in
March 1998. In their most recent filling, the plaintiffs asserted actual damages
of up to $10 million and sought punitive damages of up to $50 million. We have
filed various motions to dispose of the lawsuit on the grounds that the
plaintiffs do not have standing and have not plead causes of action cognizable
in law. The court has dismissed all claims of certain plaintiffs and some claims
of the remaining plaintiffs for failure to plead viable causes of action. The
Court has entered an order for proceedings in connection with further
examination of plaintiffs' claims.
In August 1997, we were sued in the Superior Court of the State of
California for the County of Los Angeles, by David A. Hite, Nordell
International Resources Ltd., and International Veronex Resources, Ltd. The
action was removed to the United States District Court for the Central District
of California. We and the plaintiffs were adversaries in a 1990 arbitration
proceeding in which the interest of Nordell International Resources Ltd. in the
Enim oil field in Indonesia was awarded to us (subject to a 5% net profits
interest for Nordell) and Nordell was ordered to pay us nearly $1 million. The
arbitration award was followed by a series of legal actions by the parties in
which the validity of the award and its enforcement were at issue. As a result
of these proceedings, the award was ultimately upheld and enforced. The current
suit alleges that the plaintiffs were damaged in amounts aggregating $13 million
primarily because of our prosecution of various claims against the plaintiffs,
as well as our alleged misrepresentations, infliction of emotional distress, and
improper accounting practices. The suit seeks specific performance of the
arbitration award, damages for alleged fraud and misrepresentation in accounting
for Enim field operating results, an accounting for Nordell's 5% net profit
interest, and damages for emotional distress and various other alleged torts.
The suit seeks interest, punitive damages and attorneys fees in addition to the
alleged actual damages. In August 1998, the district court dismissed all claims
asserted by the plaintiffs other than claims for malicious prosecution and abuse
of the legal process, which the court held could not be subject to a motion to
dismiss. The abuse of process claim was later withdrawn, and the damages sought
were reduced to approximately $700,000 (not including punitive damages). The
lawsuit was tried and the jury found in favor of the plaintiffs and assessed
compensatory damages against us in the amount of approximately $700,000 and
punitive damages in the amount of approximately $11 million. We believe we have
acted appropriately, and we have appealed the verdict. Nordell has
cross-appealed from the dismissal of its claims for an audit and an accounting
related to the 5% net profits interest. Enforcement of the judgment was stayed
without a bond pending the outcome of the appeal.
In addition to the matters described above, we are also subject to litigation
that is incidental to our business.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Please read the following discussion and analysis in conjunction with our
financial information and our condensed consolidated financial statements and
notes to those statements included in this report. The following information
contains forward-looking statements. For a discussion of limitations inherent in
forward-looking statements, see "Disclosure Regarding Forward-Looking
Information" and "Certain Factors That Could Affect Future Operations" below.
RECENT DEVELOPMENTS
-------------------
On July 17, 2001, a subsidiary of Amerada Hess Corporation commenced a
tender offer to purchase all of our outstanding ordinary shares for $45 per
share. Amerada Hess' offer is described in detail in a Schedule TO and its
exhibits that Amerada Hess filed with the Securities and Exchange Commission
on July 17, 2001.
The tender offer is conditioned upon there being validly tendered, and not
withdrawn, a number of ordinary shares that represents at least 90% in value of
our outstanding ordinary shares on a fully-diluted basis. The tender offer is
also subject to regulatory approvals and other customary conditions, but the
tender offer is not subject to any financing condition. The tender offer is
scheduled to expire at midnight, New York City time, on August 13, 2001, subject
to possible extension.
If the 90% condition is not satisfied, but there are tendered at least a
number of ordinary shares representing a majority of the total number of votes
of the outstanding ordinary shares on a fully-diluted basis, Amerada Hess at its
option may purchase those shares that are tendered. If Amerada Hess terminates
the offer, it may, at its option, require us to seek approval from our
shareholders for a scheme of arrangement pursuant to which all ordinary shares
would be acquired for $45 in cash per ordinary share and all 8% convertible
preference shares would be purchased for $180, plus accrued and unpaid
dividends, in cash per preference share, or it may cease the acquisition
altogether.
The tender offer is being made pursuant to an acquisition agreement we
entered into with Amerada Hess on July 9, 2001, as amended. We also entered into
a principal shareholders agreement with Amerada Hess, HM4 Triton L.P. and
certain affiliates of HM4 Triton L.P. These principal shareholders together hold
ordinary shares and 8% convertible preference shares representing, in the
aggregate, approximately 34% of our outstanding ordinary shares, determined on a
fully-diluted basis. Pursuant to the principal shareholders agreement, the
principal shareholders have agreed to tender their ordinary shares (including
ordinary shares issuable upon conversion of their preference shares) in the
tender offer. In addition, pursuant to the principal shareholders agreement,
subject to specified conditions, if the tender offer expires or is terminated,
Amerada Hess has agreed to purchase, and the principal shareholders have agreed
to sell to Amerada Hess, their shares at the price of $45 per ordinary share and
$180.00 per 8% convertible preference share, plus accumulated and unpaid
dividends. In order to effectuate these transactions, we amended our
shareholders agreement with HM4 Triton, L.P. to provide that if and when Amerada
Hess purchases the principal shareholders' shares pursuant to the terms of the
principal shareholders agreement, Amerada Hess would become entitled to the same
rights and subject to the same restrictions under the shareholders agreement to
which HM4 Triton, L.P. currently is entitled or subject. These rights include,
among others, the right to designate up to four directors to our board of
directors and the right to approve or disapprove of certain major events or
transactions.
If pursuant to the tender offer Amerada Hess owns at least 90% in value of
our ordinary shares, Amerada Hess and we will take all necessary action under
Cayman Islands law to complete a compulsory acquisition of the ordinary shares
not tendered in the tender offer as promptly as practicable following the
completion of the tender offer. The purchase price for the ordinary shares in
the compulsory acquisition would be the same as the price paid in the tender
offer.
If Amerada Hess purchases all of the tendered ordinary shares, there may be
so few remaining holders of publicly held ordinary shares that (a) our ordinary
shares will no longer meet the published guidelines of the New York Stock
Exchange for continued listing and may be delisted from the New York Stock
Exchange, (b) there may not be a public trading market for our ordinary shares,
and (c) we may cease making filings with the Securities and Exchange Commission
or may not be required to comply with the Securities and Exchange Commission
rules relating to publicly held companies.
The foregoing descriptions of the agreements are summaries and do not
purport to be complete and are qualified in their entirety by reference to the
full text of the agreements. The agreements and related agreements, as amended,
are filed as exhibits to our Form 8-K, which was filed with the Securities and
Exchange Commission on July 11, 2001, and Form 8-K/A, which was filed on July
17, 2001. You can review our filings and their exhibits, as well as the filings
of Amerada Hess, at the Securities and Exchange Commission's web site at
http://www.sec.gov. You can also obtain a copy of these filings from the public
reference room of the Securities and Exchange Commission by calling (800)
SEC-0330.
LIQUIDITY AND CAPITAL REQUIREMENTS
----------------------------------
Cash and equivalents totaled $63.1 million at June 30, 2001, and $136.4
million at December 31, 2000. Working capital was $69.9 million at June 30,
2001, compared with $63.3 million at December 31, 2000.
The following summary table reflects our cash flows for the six months ended
June 30, 2001 (in thousands):
Net cash provided (used) by operating activities $ 79,951
Net cash provided (used) by investing activities $(134,321)
Net cash provided (used) by financing activities $ (18,643)
Net Cash Provided (Used) by Operating Activities
------------------------------------------------
Our cash flows for the six months ended June 30, 2001, benefited from the
commencement of crude oil sales in January 2001 from the Ceiba field offshore
Equatorial Guinea. Gross production from the Ceiba field averaged 40,000 barrels
of oil per day ("BOPD") (28,000 BOPD net to us). Gross production from the
Cusiana and Cupiagua fields in Colombia averaged 308,000 BOPD (30,000 BOPD net
to us) during the first six months of 2001. The consolidated average realized
oil price was $24.31 per barrel. Our cash flows were reduced by working capital
changes of $68 million, primarily resulting from an increase in advances for
equipment of $62 million related to the ongoing development of the Ceiba field.
Net Cash Provided (Used) by Investing Activities
------------------------------------------------------
Our capital expenditures and other capital investments were $134.1 million
($125.6 million excluding capitalized interest) for the six months ended June
30, 2001, primarily for development of the Ceiba field in Equatorial Guinea.
Net Cash Provided (Used) by Financing Activities
------------------------------------------------------
For the six months ended June 30, 2001, we repaid borrowings of $4.5
million under a term credit facility and paid cash preference-share dividends
totaling $14.5 million.
Future Capital Needs
----------------------
Our revised capital spending program for the year ending December 31, 2001,
is approximately $385 million, excluding capitalized interest and acquisitions,
of which approximately $318 million relates to exploration and development
activities in Equatorial Guinea ($104.4 million paid through June 30 not
including $55 million advanced to vendors for equipment), $39 million relates to
exploration and development activities in Colombia ($18.4 million paid through
June 30) and $28 million relates to our exploration activities in other parts of
the world ($2.8 million paid through June 30). In addition, we have accrued
capital spending of $51.7 million at June 30, 2001.
In Equatorial Guinea, we are continuing to implement an accelerated
appraisal and development program for the Ceiba field, as well as continuing our
exploration program. The current plan for development calls for a total of 10
production wells and four water injection wells to be drilled and completed by
early 2002. In connection with this phase of development, we are planning to
increase the processing capacity of the floating production, storage and
offloading vessel ("FPSO") from 60,000 barrels of fluids per day to
approximately 160,000 barrels of fluids per day and to install onboard
water-injection facilities to inject up to 135,000 barrels per day of water.
In June 2001, we announced that we made oil discoveries with the Okume-1
and Oveng-1 wells in Block G in Equatorial Guinea. We are formulating an
appraisal program to confirm the Okume and Oveng discoveries and define minimum
economic reserves for project development. Additionally, we are evaluating
options for an early production system if warranted.
In the event the Amerada Hess transaction does not close, we expect to fund
2001 capital spending with a combination of some or all of the following: cash
flow from operations, cash, our unsecured revolving bank credit facility, and
the issuance of debt or equity securities.
In order to install the necessary equipment to increase the processing
capacity of the facilities in Equatorial Guinea, we expect that we will be
required to temporarily halt production from the Ceiba field. Currently, we
expect that this production halt will begin in January 2002 and will last
approximately four weeks. The prices we realize from our sales also are subject
to a number of uncertanties, such as fluctuations in benchmark prices, as well
as differentials from these prices. See "Disclosure Regarding Forward-Looking
Information" and "Certain Factors That Could Affect Future Operations" below.
In May 2001, we extended the maturity date of our revolving credit facility
with a group of banks from February 2002 to June 2003. The credit facility
gives us the right to borrow from time to time up to the amount of the borrowing
base determined by the banks, not to exceed $150 million. As of July 30, 2001,
the borrowing base was $150 million, and we had no borrowings outstanding under
the facility.
To facilitate a possible future securities issuance or issuances, we have
on file with the Securities and Exchange Commission a shelf registration
statement under which we could issue up to an aggregate of $250 million debt or
equity securities.
At June 30, 2001, we had guaranteed the performance of a total of $6.6
million in future exploration expenditures to be incurred in Greece through
2001. This commitment is backed primarily by an unsecured letter of credit.
RESULTS OF OPERATIONS
---------------------
Sales volumes and average prices realized were as follows:
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------- -------------------
2001 2000 2001 2000
-------- -------- -------- --------
<s> <c> <c> <c> <c>
Sales volumes:
Oil (MBbls)
Equatorial Guinea 2,377 --- 5,544 ---
Colombia
Sales, excluding forward oil sale 2,498 2,755 5,447 5,209
Forward oil sale (MBbls delivered) --- --- --- 762
-------- -------- -------- --------
Total 4,875 2,755 10,991 5,971
======== ======== ======== ========
Gas - Colombia (MMcf) 128 109 256 220
Weighted average price realized:
Oil (per Bbl) (1) $ 25.34 $ 25.28 $ 24.31 $ 24.09
Gas (per Mcf) $ 1.55 $ 1.23 $ 1.54 $ 1.25
(1) Includes the effect of barrels delivered under the forward oil sale that
were recognized at $11.56 per barrel and settlements of derivative instruments.
THREE MONTHS ENDED JUNE 30, 2001,
COMPARED WITH THREE MONTHS ENDED JUNE 30, 2000
Oil and Gas Sales
--------------------
Consolidated oil and gas sales for the second quarter of 2001 totaled
$123.7 million, a 77% increase from the second quarter of 2000, due to the
commencement of crude oil sales from the Ceiba field in Equatorial Guinea in
January 2001. Consolidated sales volumes increased 77% in second-quarter 2001,
compared with the prior-year quarter.
Oil sales from the Ceiba field totaled $55.3 million for the second quarter
of 2001. The average realized oil price was $23.25 per barrel. Gross production
from the Ceiba field averaged 41,000 BOPD (29,000 BOPD net to us).
Oil and gas sales from the Cusiana and Cupiagua fields in Colombia totaled
$68.5 million for the second quarter of 2001 and $69.8 million for the
prior-year quarter. The average realized oil price increased $2.05 per barrel to
$27.33 per barrel, resulting in an increase in revenues of $5.1 million,
compared with the same period in 2000. This increase was offset by lower sales
volumes, resulting in a revenue decrease of $6.5 million. Gross production from
the Cusiana and Cupiagua fields averaged 303,000 BOPD (29,000 BOPD net to us)
for the second-quarter 2001, compared with 342,000 BOPD (33,000 BOPD net to us)
for the prior-year quarter.
Sales of our crude oil in both Colombia and Equatorial Guinea are
recognized when the crude oil is "lifted," or transferred to the buyer's tanker.
The number of liftings occurring on a quarter-to-quarter basis may fluctuate
based upon tanker availability and lifting schedules. As a result, we expect
that our revenues on a quarter-to-quarter basis will be subject to variation
depending on the timing of liftings of our production.
We have entered into financial and commodity market transactions
intended primarily to reduce risk associated with changing oil prices. Our
oil sales were approximately $.4 million more during the three months ended
June 30, 2001, and approximately $7.3 million less during the three months ended
June 30, 2000,than if we had not entered into those transactions. Looking
forward, we have hedged the WTI and Dated Brent price components on a
portion of our 2001 and 2002 oil production. See "Quantitative and Qualitative
Disclosures about Market Risk" below.
Costs and Expenses
--------------------
Operating expenses totaled $25.1 million in 2001, compared with $14.1
million in 2000. Second-quarter 2001 operating expenses included $13.5 million,
or $5.67 per barrel, associated with oil sales in Equatorial Guinea. In
Colombia, operating expenses were $4.60 per equivalent barrel in the
second-quarter 2001, compared with $5.15 per equivalent barrel in the prior-year
quarter.
Depreciation, depletion and amortization increased $14.1 million, primarily
due to the commencement of liftings from the Ceiba field and a higher depletion
rate per barrel in Colombia. Depletion per barrel of production was $5.55 in
Equatorial Guinea for second-quarter 2001, while Colombia's depletion rate per
equivalent barrel of production was $4.89 in the second-quarter 2001 compared
with $4.21 in the second-quarter 2000.
General and administrative expenses before capitalization decreased $1
million to $7.6 million in 2001. Capitalized general and administrative costs
were $1.8 million in 2001 and $2.8 million in 2000.
Interest Expense, Net
-----------------------
Gross interest expense increased $2.1 million, or 22%, to $11.5 million in
2001 as a result of higher outstanding debt balances following the issuance of
the 8 7/8% Senior Notes due 2007 in the fourth quarter of 2000. Capitalized
interest decreased $.8 million in 2001 to $4.5 million.
Income Taxes
-------------
Current taxes associated with our Colombian operations increased to $16.7
million in 2001, from $11.6 million in 2000. Current taxes in 2000 included a
$5.3 million benefit from the utilization of our net operating losses. The
income tax provisions included deferred tax expense of $6.4 million for 2001 and
$1.7 million for 2000. This increase is primarily associated with the deferred
taxes related to operations in Equatorial Guinea.
SIX MONTHS ENDED JUNE 30, 2001,
COMPARED WITH SIX MONTHS ENDED JUNE 30, 2000
Oil and Gas Sales
--------------------
Consolidated oil and gas sales in 2001 totaled $267.6 million, an 86%
increase from prior year due to the commencement of crude oil sales from the
Ceiba field in Equatorial Guinea in January 2001.
Oil sales from the Ceiba field totaled $117.7 million in 2001. The average
realized oil price was $21.23 per barrel. Gross production from the Ceiba field
averaged 40,000 BOPD (28,000 BOPD net to us).
Oil and gas sales from the Cusiana and Cupiagua fields in Colombia totaled
$149.9 million in 2001 and $144.1 million for the prior-year. The average
realized oil price increased $3.36 per barrel to $27.45 per barrel, resulting in
an increase in revenues of $18.3 million, compared with the same period in 2000.
This increase was offset by lower sales volumes, resulting in a revenue decrease
of $12.6 million. Gross production from the Cusiana and Cupiagua fields averaged
308,000 BOPD (30,000 BOPD net to us) in 2001, compared with 353,000 BOPD (34,000
BOPD net to us) in the prior-year.
We have entered into financial and commodity market transactions intended
primarily to reduce risk associated with changing oil prices. Our oil sales
were approximately $1.1 million more during the six months ended June 30, 2001,
and approximately $13.4 million less during the six months ended June 30, 2000,
than if we had not entered into those transactions.
Costs and Expenses
--------------------
Operating expenses totaled $58.8 million in 2001, compared with $29.9
million in 2000. Operating expenses for the six months ended June 30, 2001
included $30.8 million, or $5.56 per barrel, associated with oil sales in
Equatorial Guinea. In Colombia, operating expenses were $5.12 per equivalent
barrel in 2001, compared with $5.02 per equivalent barrel in the prior-year.
Depreciation, depletion and amortization increased $33.1 million, primarily
due to the commencement of liftings from the Ceiba field and a higher depletion
rate per barrel in Colombia. Depletion per barrel of production was $5.55 in
Equatorial Guinea for 2001, while Colombia's depletion rate per equivalent
barrel of production was $4.89 in 2001 compared with $4.21 in 2000.
General and administrative expenses before capitalization increased $.9
million to $16.1 million in 2001. Capitalized general and administrative costs
were $4 million in 2001 and $4.8 million in 2000.
Interest Expense, Net
-----------------------
Gross interest expense increased $4.2 million, or 23%, to $22.9 million in
2001 as a result of higher outstanding debt balances following the issuance of
the 8 7/8% Senior Notes due 2007 in the fourth quarter of 2000. Capitalized
interest decreased $1.4 million in 2001 to $8.5 million.
Income Taxes
-------------
Current taxes associated with our Colombian operations increased to $36.3
million in 2001, from $20 million in 2000. Current taxes in 2000 included a $10
million benefit from the utilization of our net operating losses. The income
tax provisions included deferred tax expense of $12.6 million for 2001 and $4
million for 2000. This increase is primarily associated with the deferred taxes
related to operations in Equatorial Guinea.
Cumulative Effect of Accounting Change
------------------------------------------
We adopted Statement of Financial Accounting Standards No. 133 ("SFAS
133"), "Accounting for Derivative Instruments and Hedging Activities," on
January 1, 2001. In accordance with the transition provision of SFAS 133, we
recorded a net-of-tax cumulative effect gain of $1.2 million, or $0.02 per
diluted share, to earnings to recognize the ineffective portion of changes in
fair value of hedging positions and the time value component of option
contracts. We also recorded a net-of-tax cumulative effect gain of $2.9 million
to comprehensive income to recognize the fair value of the effective portion of
all derivative instruments designated as cash flow hedges.
We adopted Securities and Exchange Commission Staff Accounting Bulletin
(SAB) 101, "Revenue Recognition in Financial Statements," effective January 1,
2000, which requires us to record oil revenue on each sale, or tanker lifting,
and our oil inventories at cost, rather than at market value as in the past.
The cumulative effect of this change for periods prior to January 1, 2000, was a
reduction in net earnings of $1.3 million, or $0.02 per diluted share.
DISCLOSURE REGARDING FORWARD-LOOKING INFORMATION
------------------------------------------------
Some statements in this report and the documents we refer you to, as well
as written and oral statements made from time to time by us and our
representatives in other reports, filings with the Securities and Exchange
Commission, news releases, conferences, teleconferences, World Wide Web postings
or otherwise, may be deemed to be "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, Section 21E of the
Securities Exchange Act of 1934 and the Private Securities Litigation Reform Act
of 1995. This information is subject to the "Safe Harbor" provisions of those
statutes. Forward-looking statements include statements concerning Triton's and
management's plans, objectives, expectations, goals, budgets, strategies and
future operations and performance and the assumptions underlying these
forward-looking statements. We use the words "anticipates," "estimates,"
"expects," "believes," "intends," "plans," "budgets," "may," "will," "should"
and similar expressions to identify forward-looking statements. These statements
include information regarding:
- drilling schedules;
- expected or planned production capacity;
- our interpretation of seismic data;
- future production from the Cusiana and Cupiagua fields in Colombia,
including the Recetor license;
- future production from the Ceiba field in Equatorial Guinea, including
volumes and future phases of development;
- our exploration, appraisal and development activities in Equatorial
Guinea;
- the completion of development and commencement of production offshore
Malaysia-Thailand and the realization of future incentive payments;
- our capital budget, future capital requirements and ability to meet our
future capital needs;
- commodity prices and future revenues, cash flows, costs and expenses;
- our ability to realize our deferred tax asset;
- the level of future expenditures for environmental costs;
- the outcome of regulatory and litigation matters;
- the fair value of derivative instruments; and
- estimates of oil and gas reserves and discounted future net cash flows
from reserves.
We base these statements on our then current expectations. These statements
involve a number of risks and uncertainties, including those described in the
context of the forward-looking statements, as well as those presented in our
Annual Report on Form 10-K for the year ended December 31, 2000, and in "Certain
Factors That Could Affect Future Operations" below. Actual results and
developments could differ materially from those expressed in or implied by these
statements. You should not put undue reliance on any forward-looking statements.
We do not undertake to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
CERTAIN FACTORS THAT COULD AFFECT FUTURE OPERATIONS
---------------------------------------------------
Our business is subject to a number of risks and uncertainties, many of
which could affect whether our forward-looking statements become inaccurate.
These include, but are not limited to, the following:
Commodity Prices. Currently, we derive substantially all of our revenues
and operating cash flow from the sale of oil. The market prices for oil and
natural gas historically have been volatile and are likely to continue to be
volatile in the future. Decreases in oil and natural gas prices will adversely
affect our revenues, results of operations and cash flows. Changes in the price
of oil also may change the fair value of derivatives we may enter into from time
to time, and these changes may increase or decrease our earnings from period to
period.
International Operations. We conduct substantially all of our exploration
and production operations and derive substantially all our revenues from outside
of the United States. International operations, particularly in the oil and gas
business, are subject to political, economic and other uncertainties, which
include:
- the risk of expropriation, nationalization, war, revolution, border
disputes, renegotiation or modification of existing contracts, and
import, export and transportation regulations and tariffs;
- taxation policies, including royalty and tax increases and retroactive tax
claims;
- exchange controls, currency fluctuations and other uncertainties arising
out of foreign government sovereignty over our international
operations;
- laws and policies of the United States affecting foreign trade, taxation
and investment; and
- the possibility of being subjected to the exclusive jurisdiction of
foreign courts in connection with legal disputes and the possible
inability to subject foreign persons to the jurisdiction of courts in
the United States.
Operating Risks. Our activities are subject to all of the operating risks
and hazards normally associated with the exploration for and production of oil
and gas, including:
- blowouts, explosions, uncontrollable flows of oil, gas or well fluids,
pollution, earthquakes, formations with abnormal pressures, labor
disruptions and fires;
- environmental hazards, such as oil spills, gas leaks and ruptures and
discharges of toxic substances or gases;
- the risk of drilling nonproductive wells or dry holes; and
- the risk that drilling is delayed or halted because of such events as
title problems, weather conditions and shortages or delays in the
delivery or availability of equipment.
In accordance with customary industry practices, we maintain insurance
against some, but not all, of these risks and losses. Pollution and similar
environmental risks generally are not fully insurable. If an event occurs that
is not fully covered by insurance, it could result in a financial loss and
reduce our resources for capital expenditures. In addition, we cannot be sure
that insurance will continue to be available, or that insurance will continue to
be available at premium levels that justify its purchase.
Environmental and Other Government Regulation. We are subject to extensive
environmental laws and regulations regarding the discharge of oil, gas or other
materials into the environment, which may require us to remove or mitigate the
environmental effects of the disposal or release of such materials at various
sites. In addition, we could be held liable for environmental damages caused by
previous owners of our properties or our predecessors.
Our activities are also subject to laws, rules and regulations in the
countries where we operate, which generally pertain to production control,
taxation, environmental and pricing concerns, and other matters relating to the
petroleum industry.
Reserve Estimates. Numerous uncertainties exist in estimating quantities of
oil and gas reserves and future net revenues from those reserves. Estimates of
oil and gas reserves and related future net revenues are based on various
assumptions, which may be determined to be inaccurate. Actual future production,
oil and gas prices, revenues, taxes, capital expenditures, operating expenses,
geologic success and quantities of recoverable oil and gas reserves may vary
substantially from those assumed in the estimates and could materially affect
the estimated quantities and future net revenues of our oil and gas reserves. In
addition, reserve estimates may be subject to downward or upward revisions based
on production performance, purchases or sales of properties, results of future
development, prevailing oil and gas prices and other factors.
Possible Writedowns of Capitalized Costs. We follow the full cost method of
accounting for exploration and development of oil and gas reserves. Under this
method of accounting, all of our costs related to acquisition, holding and
initial exploration of licenses in countries where we do not have any proved
reserves are initially capitalized. We then periodically make assessments of
these licenses for impairment on a country-by-country basis. Based on our
evaluation of drilling results, seismic data and other information we deem
relevant, we may write down the carrying value of the oil and gas licenses in a
particular country. If, in the course of our exploration activities in a
particular country, we determine that continuing to explore for hydrocarbons
there is not justified, we may record a writedown during that period for the
cost pool related to that country. Due to the unpredictable nature of
exploration activities, we cannot predict the amount and timing of impairment
writedowns. Financial information concerning our assets at December 31, 2000,
including capitalized costs by geographic area, is in note 19 of Notes to
Consolidated Financial Statements of our Annual Report on Form 10-K for the year
ended December 31, 2000.
Possible Ceiling Test Writedowns. We also may be required to write down the
carrying value of properties where we have proved reserves as a result of the
"full cost ceiling limitation" prescribed by the Securities and Exchange
Commission. Under the full cost ceiling limitation, we must write down the
carrying value of properties in any country where we have proved reserves to the
extent that the net capitalized costs of the properties, less related deferred
income taxes, exceeds the amount given by the following formula:
(1) the estimated future net revenues from the properties, discounted at
10%; plus
(2) unevaluated costs not being amortized; plus
(3) the lower of cost or estimated fair value of unproved properties being
amortized; minus
(4) income tax effects related to differences between the financial
statement basis and tax basis of oil and gas properties.
The discounted future net revenues from a property are determined based on
the selling price of oil or gas at the end of the accounting period, or when
results of operations for that period are determined.
Operations in Colombia. We derive a substantial part of our revenues and
operating cash flow from our interest in the Cusiana and Cupiagua fields in
Colombia. The operator of the fields is BP p.l.c. ("BP"). Pipelines connect the
major producing fields in Colombia to export facilities and refineries. From
time to time, guerrilla activity in Colombia has disrupted the operation of oil
and gas projects. The guerrilla activity has increased over the last few years
and appears to be increasing as political negotiations among government and
various rebel groups proceed. In addition, the government of the United States
has enacted a program to assist the government of Colombia in its efforts to
halt the flow of illegal drugs, which may intensify the guerrillas' efforts to
disrupt oil operations. Guerrilla activity has caused delays in the development
of the fields in Colombia and from time to time has slowed the operator's
ability to put workers in the fields. The partners in the fields, together with
the Colombian government, have taken steps to maintain security and favorable
relations with the local population. We cannot assure you that these attempts to
reduce or prevent guerrilla activity will be successful or that guerrilla
activity will not disrupt our operations and cash flow in the future.
The Cusiana and Cupiagua fields are in natural decline. The operator has
devised a plan to enhance reservoir management by implementing a more aggressive
well-maintenance and workover program. We cannot assure you that these attempts
to offset the decline in production will be successful. Because our contracts in
Colombia give us a limited time to produce the oil, if in the future we
determine that rates of production will be lower than we had previously assumed
in determining proved reserves, we may be required to reduce the quantity of our
proved reserves by an amount greater than production. We are highly dependent on
the performance by the operator to enhance production. We cannot assure you that
we will meet our production targets.
Operations in Equatorial Guinea. We derive a substantial part of our
revenues and operating cash flow from our interest in the Ceiba field offshore
the Republic of Equatorial Guinea, and we are in an early stage of appraisal and
development of the field. Production rates from the first phase of development
of the field will depend on well and reservoir performance, our ability to
improve pressure support through water injection and other factors. In
connection with the next phase of development, we are planning to drill
additional production and water injection wells, increase the processing
capacity of the FPSO and install onboard water-injection facilities on the FPSO.
Production rates from the field in future phases of development will depend on a
number of additional factors, including the drilling and completion of
successful development and water injection wells, timing of the completion of
the additional production and water-injection facilities, the timing of the
connection of the production and water injection wells to the FPSO, our ability
to maintain pressure support through water injection and other factors. We
cannot assure you that we will meet our production targets. We are highly
dependent on third-party contractors, including the firm that owns and is
maintaining and operating the FPSO vessel.
Operations in the Gulf of Thailand. Through a company we own with BP, we
are a partner in a significant gas exploration project located in Block A-18
of the Malaysia-Thailand Joint Development Area in the Gulf of Thailand. We and
our partners have been successful in discovering eight natural gas fields to
date, and in October 1999, we and the other parties to the production sharing
contract for Block A-18 executed a gas sales agreement providing for the sale of
the first phase of gas. Under terms of the gas sales agreement, delivery of gas
is scheduled to begin following timely completion and approval of an
environmental impact assessment associated with the buyers' pipeline and
processing facilities. A lengthy approval process, or significant opposition to
the project, as well as a number of events unrelated to the environmental
approval that are beyond our control, could delay construction and the
commencement of gas sales. We cannot assure you that the buyers will receive
approval of the environmental impact assessment or, if they do receive approval,
when that approval will occur. It is possible that if the environmental impact
assessment process does result in a significant delay, the buyers could seek an
alternate route for the delivery of the gas. We cannot assure you as to when any
such alternate route could be completed or when gas sales could commence. Based
on the delays to date in obtaining the environmental approval, for internal
planning purposes we are assuming that production will begin no earlier than the
fourth quarter of 2002.
In connection with the sale to BP of one-half of the shares through which
we owned our interest in Block A-18, BP agreed to pay the future exploration and
development costs attributable to our collective interest in Block A-18, up to
$377 million or until first production from a gas field, after which we and BP
would each pay 50% of such costs. We cannot assure you that our and BP's
collective share of the cost of developing the project through first production
will not exceed $377 million.
BP also agreed to pay us specified incentive payments if the requisite
criteria were met. The first $65 million in incentive payments is conditioned
upon having the production facilities for the sale of gas from Block A-18
completed by June 30, 2002. If the facilities are completed after June 30, 2002,
but before June 30, 2003, the incentive payment would be reduced to $40 million.
A lengthy environmental approval process, or delays in construction of the
facilities, could result in our receiving a reduced incentive payment or
possibly the complete loss of the first incentive payment. For purposes of
estimating our discounted net cash inflows from our proved reserves in Block
A-18, we have assumed that we would be entitled to a $40 million incentive
payment. In addition, we have agreed to share some of the costs of development
with BP in the event that the environmental approval process delays production
by agreeing to pay BP $1.25 million per month for each month, if applicable,
that first gas sales are delayed beyond 30 months following the award of an
engineering, procurement and construction contract for the project in March
2000. Our obligation is capped at 24 months of these payments, or $30 million.
Significant Shareholder. HM4 Triton, L.P., an affiliate of Hicks, Muse,
Tate & Furst Incorporated, owns 8% Convertible Preference Shares representing a
significant portion of our voting shares. In addition, HM4 Triton, L.P. is a
party to a Shareholders Agreement with us that gives it the right to designate
four out of 10 of the directors on our board and requires us to obtain its
consent before we can take specified corporate actions. As a result, HM4 Triton,
L.P. and Hicks, Muse, Tate & Furst Incorporated have significant influence over
our business, policies and affairs. The interests of HM4 Triton, L.P. and Hicks,
Muse, Tate & Furst Incorporated may differ from those of our other shareholders,
and the influence they have may have the effect of discouraging selected
transactions involving an actual or potential change of control of Triton.
Possible Future Acquisitions. Our strategy includes the possible
acquisition of additional reserves, including through possible future business
combination transactions. We cannot assure you as to the terms upon which any
such acquisitions would be consummated or as to the effect any such transactions
would have on our financial condition or results of operations. An acquisition
could involve the use of our cash, or the issuance of debt or equity securities,
which could have a dilutive effect on our current shareholders.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Our oil sales are normally priced with reference to a defined benchmark,
such as WTI spot and Dated Brent. The price we actually receive will vary from
the benchmark depending on quality and location differentials. As a matter of
policy, from time to time, we use financial market transactions with
creditworthy counterparties to reduce risk associated with the pricing of our
oil sales. The policy is structured to underpin our planned revenues and
results of operations. We cannot assure you that our use of financial market
transactions will not result in losses. We do not enter into financial market
transactions for trading purposes.
We have entered into derivative contracts for 2.4 million barrels of oil
production during the period from July to March 2002 using WTI-based oil-price
collars to establish a weighted average floor price of $25.92 per barrel and a
ceiling price of $28.96 per barrel, and 600,000 barrels of oil production using
Dated Brent-based oil-price collars to establish a weighted average floor price
of $25.13 per barrel and a ceiling price of $27.79 per barrel. In addition, we
have entered into contracts for 1.2 million barrels of oil production using
WTI-based oil-price swaps and 600,000 barrels of oil production using Dated
Brent-based oil-price swaps to establish weighted average fixed prices of $26.36
per barrel for WTI and $24.31 for Dated Brent during the period from July to
December 2001.
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS FOR VOTE OF SECURITY HOLDERS
We held our Annual Meeting of Shareholders on May 15, 2001. At the meeting,
our shareholders voted on the election of three directors for a term expiring in
2004, and on a proposal to adopt our 2001 Share Incentive Plan.
The directors elected and the votes cast for or withheld were as follows:
FOR WITHHELD
--- --------
Tom C. Davis 55,305,763 443,102
James C. Musselman 55,315,991 432,874
C. Lamar Norsworthy 54,663,806 1,085,059
The following directors continued in office: Sheldon R. Erikson, Jack D. Furst,
Thomas O. Hicks, John R. Huff, Michael E. McMahon, C. Richard Vermillion,
Jr. and J. Otis Winters.
The shareholders also approved the adoption of the 2001 Share Incentive
Plan, with 51,102,896 shares being voted for adoption, 4,500,934 shares being
voted against adoption and 145,035 shares abstaining.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits: The following documents are filed as part of this Quarterly
Report on Form 10-Q:
1. Exhibits required to be filed by Item 601 of Regulation S-K. (Where the
amount of securities authorized to be issued under any of Triton Energy
Limited's and any of its subsidiaries' long-term debt agreements does not exceed
10% of the Company's assets, pursuant to paragraph (b)(4) of Item 601 of
Regulation S-K, in lieu of filing such as exhibits, the Company hereby agrees to
furnish to the Commission upon request a copy of any agreement with respect to
such long-term debt.)
<s> <c>
3.1 Memorandum of Association (previously filed as an exhibit to the Company's
Registration Statement on Form S-3 (No 333-08005) and incorporated herein by
reference)
3.2 Articles of Association (previously filed as an exhibit to the Company's
Registration Statement on Form S-3 (No 333-08005) and incorporated herein by
reference)
4.1 Specimen Share Certificate of Ordinary Shares, $.01 par value, of the Company
(previously filed as an exhibit to the Company's Registration Statement on Form 8-A
dated March 25, 1996, and incorporated herein by reference)
4.2 Unanimous Written Consent of the Board of Directors authorizing the Company's 8%
Convertible Preference Shares (previously filed as an exhibit to the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30, 1998, and
incorporated herein by reference.)
4.3 Rights Agreement dated as of March 25, 1996, between Triton and The Chase
Manhattan Bank, as Rights Agent, including, as Exhibit A thereto, Resolutions
establishing the Junior Preference Shares (previously filed as an exhibit to the
Company's Registration Statement on Form S-3 (No 333-08005) and incorporated herein
by reference)
4.4 Amendment No. 1 to Rights Agreement dated as of August 2, 1996, between Triton
Energy Limited and The Chase Manhattan Bank, as Rights Agent (previously filed as an
exhibit to the Company's Registration Statement on Form 8-A/A (Amendment No. 1)
dated August 14, 1996, and incorporated herein by reference)
4.5 Amendment No. 2 to Rights Agreement dated as of August 30, 1998, between Triton
Energy Limited and The Chase Manhattan Bank, as Rights Agent (previously filed
as an exhibit to the Company's Registration Statement on Form 8-A/A (Amendment No.
2) dated October 2, 1998, and incorporated herein by reference)
4.6 Amendment No. 3 to Rights Agreement dated as of January 5, 1999, between Triton
Energy Limited and The Chase Manhattan Bank, as Rights Agent (previously filed
as an exhibit to the Company's Registration Statement on Form 8-A/A (Amendment No.
3) dated January 31, 1999, and incorporated herein by reference)
4.7 Amendment No. 4 to Rights Agreement dated as of July 9, 2001, between Triton
Energy Limited and Mellon Investor Services, Inc. (as successor to The Chase Manhattan
Bank), as Rights Agent (previously filed as an exhibit to the Company's Current Report
on Form 8-K filed on July 11, 2001, and incorporated herein by reference)
10.1 Amended and Restated Retirement Income Plan (previously filed as an exhibit
to Triton Energy Corporation's Quarterly Report on Form 10-Q for the quarter ended
November 30, 1993, and incorporated by reference)
10.2 Amendment to the Retirement Income Plan dated August 1, 1998. (previously filed
as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1998, and incorporated herein by reference.)
10.3 Amendment to Amended and Restated Retirement Income Plan dated
December 31, 1996 (previously filed as an exhibit to the Company's Quarterly Report
on Form 10-Q for the quarter ended March 31, 1998, and incorporated herein by
reference)
10.4 Amended and Restated Supplemental Executive Retirement Income Plan. (previously
filed as an exhibit to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1997, and incorporated herein by reference.)
10.5 Second Amended and Restated 1992 Stock Option Plan.(previously filed as an
exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1996, and incorporated herein by reference.)
10.6 Form of Amended and Restated Employment Agreement with Triton Energy Limited
and certain officers, including Messrs. Dunlevy, Garrett and Maxted, as amended and
restated June 28, 2000 (previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2000, and incorporated
herein by reference.)
10.7 Amended and Restated Employment Agreement among Triton Energy Limited,
Triton Exploration Services, Inc. and A. E. Turner III (previously filed as an exhibit to
Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
1998, and incorporated herein by reference.)
10.8 Amended and Restated 1985 Restricted Stock Plan. (previously filed as an exhibit
to Triton Energy Corporation's Quarterly Report on Form 10-Q for the quarter ended
November 30, 1993, and incorporated herein by reference.)
10.9 First Amendment to Amended and Restated 1985 Restricted Stock Plan. (previously
filed as an exhibit to Triton Energy Corporation's Annual Report on Form 10-K for the
fiscal year ended December 31, 1995, and incorporated herein by reference.)
10.10 Second Amendment to Amended and Restated 1985 Restricted Stock Plan. (previously
filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1996, and incorporated herein by reference.)
10.11 Executive Life Insurance Plan. (previously filed as an exhibit to Triton Energy
Corporation's Annual Report on Form 10-K for the fiscal year ended May 31, 1991,
and incorporated herein by reference.)
10.12 Long-Term Disability Income Plan. (previously filed as an exhibit to Triton Energy
Corporation's Annual Report on Form 10-K for the fiscal year ended May 31, 1991,
and incorporated herein by reference.)
10.13 Amended and Restated Retirement Plan for Directors. (previously filed as an exhibit
to Triton Energy Corporation's Annual Report on Form 10-K for the fiscal year ended
May 31, 1990, and incorporated herein by reference.)
10.14 Contract for Exploration and Exploitation for Santiago de Atalayas I with an effective
date of July 1, 1982, between Triton Colombia, Inc., and Empresa Colombiana
De Petroleos. (previously filed as an exhibit to Triton Energy Corporation's Annual
Report on Form 10-K for the fiscal year ended May 31, 1990, and incorporated
herein by reference.)
10.15 Contract for Exploration and Exploitation for Tauramena with an effective date of July
4, 1988, between Triton Colombia, Inc., and Empresa Colombiana De Petroleos.
(previously filed as an exhibit to Triton Energy Corporation's Annual Report on Form
10-K for the fiscal year ended May 31, 1990, and incorporated herein by reference.)
10.16 Summary of Assignment legalized by Public Instrument No. 1255 dated September 15,
1987 (Assignment is in Spanish language). (previously filed as an exhibit to Triton
Energy Corporation's Annual Report on Form 10-K for the fiscal year ended May 31,
1993, and incorporated herein by reference.)
10.17 Summary of Assignment legalized by Public Instrument No. 1602 dated June 11, 1990
(Assignment is in Spanish language). (previously filed as an exhibit to Triton
Energy Corporation's Annual Report on Form 10-K for the fiscal year ended May 31,
1993, and incorporated herein by reference.)
10.18 Summary of Assignment legalized by Public Instrument No. 2586 dated September 9,
1992 (Assignment is in Spanish language). (previously filed as an exhibit to Triton
Energy Corporation's Annual Report on Form 10-K for the fiscal year ended May 31,
1993, and incorporated herein by reference.)
10.19 Triton Exploration Services, Inc. 401(K) Savings Plan, as amended and restated
June 1, 2000. (previously filed as an exhibit to the Company's Quarterly Report
on Form 10-Q for the quarter ended June 30, 2000, and incorporated herein by
reference.)
10.20 Contract between Malaysia-Thailand Joint Authority and Petronas Carigali
SDN.BHD. and Triton Oil Company of Thailand relating to Exploration and Production
of Petroleum for Malaysia-Thailand Joint Development Area Block A-18. (previously
filed as an exhibit to Triton Energy Corporation's Current Report on Form 8-K dated
April 21, 1994, and incorporated herein by reference.)
10.21 Form of Indemnity Agreement entered into with each director and officer of the
Company. (previously filed as an exhibit to the Company's Quarterly Report on Form
10-Q for the quarter ended September 30, 1998, and incorporated herein by reference)
10.22 Description of Performance Goals for Executive Bonus Compensation. (previously
filed as an exhibit to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1996, and incorporated herein by reference)
10.23 Amended and Restated 1997 Share Compensation Plan. (previously filed as an
exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998, and incorporated herein by reference)
10.24 First Amendment to Amended and Restated Retirement Plan for Directors. (previously
filed as an exhibit to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1997, and incorporated herein by reference)
10.25 First Amendment to Second Amended and Restated 1992 Stock Option Plan. (previously
filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1997, and incorporated herein by reference)
10.26 Second Amendment to Second Amended and Restated 1992 Stock Option Plan.
(previously filed as an exhibit to the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1997, and incorporated herein by reference)
10.27 Amended and Restated Indenture dated July 25, 1997, between Triton Energy
Limited and The Chase Manhattan Bank. (previously filed as an exhibit to the
Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1997, and
incorporated herein by reference)
10.28 Amended and Restated Second Supplemental Indenture dated July 25, 1997,
between Triton Energy Limited and The Chase Manhattan Bank relating
to the 9 1/4% Senior Notes due 2005. (previously filed as an exhibit to the
Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1997, and
incorporated herein by reference)
10.29 Indenture, dated October 4, 2000, between the Company and The Chase Manhattan
Bank, governing the Company's outstanding 8 7/8% Senior Notes Due 2007 (previously
filed as an exhibit to the Company's Registration Statement on Form S-4 (No. 333-
48584), and incorporated herein by reference.)
10.30 Shareholders Agreement dated August 3, 1998, among Triton Energy Limited, Triton
Asia Holdings, Inc., Atlantic Richfield Company, and ARCO JDA Limited.
(previously filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1998, and incorporated herein by reference)
10.31 Stock Purchase Agreement dated as of August 31, 1998, between Triton Energy
Limited and HM4 Triton, L.P. (previously filed as an exhibit to the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30, 1998, and
incorporated herein by reference)
10.32 Shareholders Agreement dated as of September 30, 1998, between Triton Energy
Limited and HM4 Triton, L.P. (previously filed as an exhibit to the Company's
Quarterly Report on Form 10-Q for the quarter ended September 30, 1998, and
incorporated herein by reference)
10.33 Financial Advisory Agreement dated as of September 30, 1998, between Triton Energy
Limited and Hicks, Muse & Co. Partners, L.P. (previously filed as an exhibit to the
Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1998,
and incorporated herein by reference)
10.34 Monitoring and Oversight Agreement dated as of September 30, 1998, between Triton
Energy Limited and Hicks, Muse & Co. Partners, L.P. (previously filed as an exhibit to
the Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
1998, and incorporated herein by reference)
10.35 Third Amendment to Amended and Restated 1985 Restricted Stock Plan (previously
filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1999, and incorporated herein by reference)
10.36 Amendment to Triton Exploration Services, Inc. Retirement Income Plan. (previously
filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1999, and incorporated herein by reference)
10.37 Amendment to the Triton Exploration Services, Inc. Supplemental Executive
Retirement Plan. (previously filed as an exhibit to the Company's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1999, and incorporated herein by
reference)
10.38 Third Amendment to the Second Amended and Restated 1992 Stock Option Plan
(previously filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1999, and incorporated herein by reference)
10.39 First Amendment to the Amended and Restated 1997 Share Compensation Plan
(previously filed as an exhibit to the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1999, and incorporated herein by reference)
10.40 Amendment dated May 11, 1999, to Amended and Restated Employment Agreement
dated July 15, 1998 among Triton Exploration Services, Inc., Triton Energy Limited
and A.E. Turner, III (previously filed as an exhibit to the Company's Quarterly Report
on Form 10-Q for the quarter ended June 30, 1999, and incorporated herein by
reference)
10.41 Second Amendment to Retirement Plan for Directors. (previously filed as an exhibit to
the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1999,
and incorporated herein by reference)
10.42 Amendment No. 1 to Shareholders Agreement between Triton Energy Limited
and HM4 Triton, L.P. (previously filed as an exhibit to the Company's Quarterly Report
on Form 10-Q for the quarter ended June 30, 1999, and incorporated herein by
reference)
10.43 Supplemental Letter Agreement dated October 28, 1999, among Triton Energy
Limited, Triton Asia Holdings, Inc., Atlantic Richfield Company, and ARCO JDA
Limited (previously filed as an exhibit to the Company's Quarterly Report on Form
10-Q for the quarter ended September 30, 1999, and incorporated herein by reference)
10.44 Gas Sales Agreement dated October 30, 1999 among the Malaysia-Thailand Joint
Authority, and Petronas Carigali (JDA) SDN.BHD., Triton Oil Company of Thailand,
Triton Oil Company of Thailand (JDA) Limited, as Sellers, and with Petroleum
Authority of Thailand and Petroliam Nasional Berhad, as Buyers. (previously filed
as an exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1999, and incorporated herein by reference)
10.45 Form of Stock Option Agreement between Triton Energy Limited and its
non-employee directors (previously filed as an exhibit to the Company's Annual
Report on Form 10-K for the fiscal year ended December 31, 1999, and
incorporated herein by reference)
10.46 Form of Stock Option Agreement between Triton Energy Limited and its employees,
including its executive officers (previously filed as an exhibit to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1999, and
incorporated herein by reference)
10.47 Amendment to Stock Options dated as of January 3, 2000, between Triton Energy
Limited and A.E. Turner. (previously filed as an exhibit to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1999, and
incorporated herein by reference.)
10.48 Form of Amendment to Stock Options dated as of January 3, 2000, between Triton
Energy Limited and its non-employee directors. (previously filed as an exhibit to
the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1999, and incorporated herein by reference.)
10.49 Production Sharing Contract between the Republic of Equatorial Guinea
and Triton Equatorial Guinea, Inc. for Block F. (previously filed as an exhibit to the
Company's Annual Report on Form 10-K for the fiscal year ended December 31,
1999, and incorporated herein by reference.)
10.50 Production Sharing Contract between the Republic of Equatorial Guinea and Triton
Equatorial Guinea, Inc. for Block G. (previously filed as an exhibit to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1999, and
incorporated herein by reference.)
10.51 Supplementary Contract (No. 1) to the Production Sharing Contract for Block A-18
dated 21 April 1994 between Malaysia-Thailand Joint Authority and Petronas
Carigali (JDA) SDN.BHD., Triton Oil Company of Thailand and Triton Oil Company
of Thailand (JDA) Limited. (previously filed as an exhibit to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1999, and
incorporated herein by reference.)
10.52 Supplementary Contract (No. 2) to the Production Sharing Contract for Block A-18
dated 21 April 1994 between Malaysia-Thailand Joint Authority and Petronas Carigali
(JDA) SDN.BHD., Triton Oil Company of Thailand and Triton Oil Company of
Thailand (JDA) Limited. (previously filed as an exhibit to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1999, and
incorporated herein by reference.)
10.53 Credit Agreement dated as of February 29, 2000, among Triton Energy Limited,
the Lenders party thereto and The Chase Manhattan bank, as Administrative Agent
(previously filed as an exhibit to the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1999, and incorporated herein by
reference)
10.54 Share Purchase Agreement dated as of May 8, 2000 between Triton International
Petroleum, Inc. and The Strategic Transaction Company. (previously filed as an
exhibit to the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 2000, and incorporated herein by reference.)
10.55 Amendment Agreement to Credit Agreement dated as of September 25, 2000, among
Triton Energy Limited, the Lenders party thereto and The Chase Manhattan Bank, as
Administrative Agent. (previously filed as an exhibit to the Company's Registration
Statement on Form S-4 (No. 333-48584), and incorporated herein by reference.)
10.56 Triton Energy Limited 2000 Broad Based Share Compensation Plan. (previously filed
as an exhibit to the Company's Registration Statement on Form S-4 (No. 333-48584),
and incorporated herein by reference.)
10.57 First Amendment to the Production Sharing Contract between the Republic of Equatorial
Guinea and Triton Equatorial Guinea, Inc. for Block F. (previously filed as an exhibit to
the Company's Registration Statement on Form S-4 (No. 333-48584), and incorporated
herein by reference.)
10.58 Assignment of State Participating Interest in the Production Sharing Contract for Block
F, Offshore Republic of Republic of Equatorial Guinea. (previously filed as an exhibit
to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
2000, and incorporated herein by reference.)
10.59 First Amendment to the Production Sharing Contract between the Republic of Equatorial
Guinea and Triton Equatorial Guinea, Inc. for Block G. (previously filed as an exhibit to
the Company's Registration Statement on Form S-4 (No. 333-48584), and incorporated
herein by reference.)
10.60 Assignment of State Participating Interest in the Production Sharing Contract for Block
G, Offshore Republic of Republic of Equatorial Guinea. (previously filed as an exhibit
to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
2000, and incorporated herein by reference.)
10.61 Second Amendment to the Amended and Restated 1997 Share Compensation Plan.
(previously filed as an exhibit to the Company's Registration Statement on Form S-4
(No. 333-48584), and incorporated herein by reference.)
10.62 Form of Amendment dated December 19, 2000 to Amended and Restated
Employment Agreement with Triton Energy Limited and Messrs. Dunlevy and
Maxted (previously filed as an exhibit to the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 2000, and incorporated herein by reference.)
10.63 Employment Agreement among Triton Energy Limited, Triton Exploration
Services, Inc. and James C. Musselman (previously filed as and exhibit to the
Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2000, and incorporated herein by reference.)
10.64 Acquisition Agreement, dated July 9, 2001, by and among Amerada Hess Corporation,
Amerada Hess (Cayman) Limited and Triton Energy Limited (previously filed as an
exhibit to the Company's Current Report on Form 8-K filed on July 11, 2001, and
incorporated herein by reference)
10.65 Principal Shareholders Agreement, dated July 9, 2001, by and among Amerada Hess
Corporation, Amerada Hess(Cayman) Limited, Triton Energy Limited and the other
Shareholders of Triton Energy Limited listed on Exhibit A thereto. (previously filed as
an exhibit to the Company's Current Report on Form 8-K filed on July 11, 2001, and
incorporated herein by reference)
10.66 Amendment No. 2 to Shareholders Agreement, dated July 9, 2001, by and between
Triton Energy Limited and HM4 Triton, L.P. (previously filed as an exhibit to the
Company's Current Report on Form 8-K filed on July 11, 2001, and incorporated
herein by reference)
10.67* Triton Energy Limited 2001 Share Incentive Plan
10.68* Third Amendment to the Amended and Restated 1997 Share Compensation Plan
10.69* First Amendment to Credit Agreement dated as of February 29, 2000, among Triton
Energy Limited, the Lenders party thereto and The Chase Manhattan bank, as
Administrative Agent
12.1* Computation of Ratio of Earnings to Fixed Charges.
12.2* Computation of Ratio of Earnings to Combined Fixed Charges and Preference
Dividends.
99.1 Rio Chitamena Association Contract. (previously filed as an exhibit to Triton Energy
Corporation's Current Report on Form 8-K/A dated July 15, 1994, and incorporated
herein by reference)
99.2 Rio Chitamena Purchase and Sale Agreement. (previously filed as an exhibit to Triton
Energy Corporation's Current Report on Form 8-K/A dated July 15, 1994, and
incorporated herein by reference)
99.3 Integral Plan - Cusiana Oil Structure. (previously filed as an exhibit to Triton Energy
Corporation's Current Report on Form 8-K/A dated July 15, 1994, and incorporated
herein by reference)
99.4 Letter Agreements with co-investor in Colombia. (previously filed as an exhibit to
Triton Energy Corporation's Current Report on Form 8-K/A dated July 15, 1994, and
incorporated herein by reference)
99.5 Amended and Restated Oleoducto Central S.A. Agreement dated as of March 31,
1995. (previously filed as an exhibit to Triton Energy Corporation's Quarterly Report
on Form 10-Q for the quarter ended June 30, 1995, and incorporated herein by
reference)
- -----------------------------
* Filed herewith
(b) Reports on Form 8-K
Form 8-K filed on April 25, 2001 furnishing information under Item 9.
Form 8-K filed on May 14, 2001 furnishing information under Item 9.
Form 8-K filed on June 20, 2001 furnishing information under Item 9.
Form 8-K filed on July 11, 2001 filing information under Items 5 and 7, as
. amended by Form 8-K/A filed July 17, 2001.
Form 8-K filed on July 17, 2001 furnishing information under Item 9.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRITON ENERGY LIMITED
By:/s/W. Greg Dunlevy
-------------------------
W. Greg Dunlevy
Senior Vice President and
Chief Financial Officer
Date: July 31, 2001