Corporate Presentation CAPP Oil and Gas Investment Symposium June 13-15, 2011
Presentation outline Company Overview St. Lawrence Lowlands, Qubec Antler, Saskatchewan New Ventures Investment Summary 2
Corporate Overview Large prospective resource in Qubec Over one million acre land position 18 Tcf prospective recoverable resource in Utica shale on Questerre lands Land tenure until 2018 Government plans to extend term further…
Asset overview St. Lawrence Lowlands, Qubec Giant Utica shale gas discovery being commercialized with partners Lorraine shale upside Southeast Saskatchewan/Manitoba Proven Bakken/Torquay light oil resource style play with cash…
Financial Overview Operating and Financial Results Quarter ended March 31 2011 2010 Working capital () 130 million 166 million Debt Nil Nil Cash Flow from operations () 1.6 million 0.5 million Production (boe/d) 650 600 Oil weighting…
St. Lawrence Lowlands, Qubec 6
St. Lawrence Lowlands Where Qubec is currently BAPE Royalty regime Legislation Social acceptability Where Questerre is currently Path to commercialization Whats next for Qubec Prerequisites for development Aerial view…
Where Qubec is currently 8
BAPE BAPE mandates multi-stakeholder committee to oversee strategic environmental assessment (SEA) European approach as opposed to North American approach BAPE says no fracture stimulation during environmental assessment…
Interim Regulations Interim regulations require operators to inform and consult with public prior to commencing operations Questerre does this already MDDEP may have representatives participate as observers in process New, but…
Royalty regime Intention is to increase government take from 33% to 50% for base royalty Including corporate and provincial taxes Target is similar to current regime in British Columbia and Alberta for conventional production…
Legislation Clear from BAPE study and royalty report that Qubec is working hard to create an oil and gas regime Qubec is not relying on industry so it will take time to independently develop their own expertise 6 million budget…
Social acceptability Industry is disconnected from the public Financial intermediation separates producers from consumers Risk management industry accustomed to moving capital from one jurisdiction to another Not a consumer-focused…
Where Questerre is currently 14
Where Questerre is currently 4.4 TCF prospective recoverable resource, evaluated by NSAI Land position is the heart of the fairway Premium gas market Currently in advanced piloting phase Land held until at least 2018 15
Path to commercialization 600 500 Committed Capital ( millions) 400 400+ 300 Quebec Currently 200 100 to 300 100 0 to 75 50 to 150 0 IDENTIFY INVESTIGATE ADVANCED TRIAL COMMENCE Resource Rock Properties Pilots…
Whats next for Qubec 17
Prerequisites for development Strategic Environmental Assessment Complete advanced piloting phase and sweet spot identification Establish hydrocarbon legislation Achieve social acceptability Develop local service sector 18
Antler, Saskatchewan 19
Antler Overview A core area for Questerre High margin, light oil asset targeting Torquay/Bakken resource play Average royalties of 6% and operating costs of approximately 10/bbl Developing and expanding existing oil pool with…
Antler Key Statistics Infill and step out locations 42 Exploration acreage (sections) 60 2P Reserves (million bbls) 1.4 2010 Recycle ratio 2.5 (2P Reserves including future capital) 2010 Netbacks per barrel 63.12 (2010…
Antler Developing a core area Goal is to increase production to 2,000 bbl/d during SEA in Quebec Move from 1 rig to 2 rigs + contract frac crew for 2012 Water flood to further increase recoveries Acquisitions in core operating…
New Ventures Questerre is an early leader in shale Internal expertise and core competencies beyond typical juniors Hired pioneer in shale gas development in North America, Dr. Basim Faraj for new ventures team Have resources,…
Outlook Accelerate work with Quebec government and other stakeholders over next two years Conduct pilot operations and participate in SEA Establish hydrocarbon legislation and regulatory framework targeting early commercial…
Investment summary Mega discovery in Utica shale with long land tenure Strong Unconventional light oil resource play in Saskatchewan portfolio Well positioned to acquire and develop leading edge shale projects Large retained…
Management and Board Management Board Michael Binnion, President & Chief Executive Les Beddoes, Jr. Officer International explorationist John Brodylo, VP Exploration (Nexen) Former VP Exploration, Bow Valley Energy Inc.; Victoria, BC…
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