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INVESTOR UPDATE – Long Run Exploration Ltd.

Long Run Exploration Ltd. · Jun 1, 2014 · 37 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 1
    INVESTOR UPDATE JUNE 2014 1
  2. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 2
    LONG RUN PROFILE Lis1ng TSX:LRE Northern Gas Shares Outstanding 149 million Market Capitaliza1on 850 million Peace River Area Liquidity 800,000 (shares/day; YTD) ALBERTA Q1 2014 Produc1on 25,613 Boe/d Deep Basin…
  3. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 3
    CORPORATE STRATEGY Provide long-term value to shareholders with sustainable yield plus growth model where capital expenditures and dividends are funded through funds ow from operaGons Provide growth through controlled…
  4. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 4
    STRATEGY - OPERATIONS Focus on strong capital eciencies within porVolio of properGes Improve recycle raGo through capital and operaGonal cost control Build and expand infrastructure to maximize operaGng eciencies and minimize…
  5. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 5
    STRATEGY - FINANCE Ensure corporate sustainability by funding dividends and capital spending through funds ow from operaGons Execute nancial strategy without the aid of a dividend reinvestment program (DRIP) Target net debt…
  6. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 6
    RESULTS AND TRACK RECORD Strong Reserve Growth 120 Reserve Growth 1 0.89 0.9 ConGnuous strong reserve 100 growth 0.8 0.75 80 0.7 Increased proved plus 0.6 probable reserves (P+P) 17% 0.52 per share YoY…
  7. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 7
    RESULTS AND TRACK RECORD Produc3on & Funds Flow Growth Produc1on Growth Funds Flow Growth 30,000 Implemented 0.08 80,000 0.60 New Management Dividend 0.074 0.56 New Management Implemented Team Team Dividend 0.069 0.07…
  8. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 8
    WHY A DIVIDEND Assets Long Runs proven and predictable assets support a sustainable total payout raGo People Highly experienced technical teams who are able to embrace new technologies, maximize resource recovery and take…
  9. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 9
    2014 GUIDANCE Guidance 2014 Pre-Acquisi1on 2014 Post Acquisi1on (LRE 12 month + Acquisi1on assets 7 months) ProducGon average 26,300 Boe/d 29,200 Boe/d Average producGon per share 0.075 Boe/d 0.071 Boe/d % Oil and NGLs…
  10. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 10
    PEER COMPARABLES 2014e Yield 2014e Total Payout RaGo(1) 2014e Debt/Funds Flow 2014e EV/DACF Source: Na3onal Bank; based on strip pricing at 05/30/2014 (1) Total Payout is net of DRIP 10
  11. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 11
    RECENT ACTIVITY 320 million in acquisiGons & 32 million in divesGtures over the past 9 months which consolidated exisGng core operaGng areas and added an addiGonal core operaGng area Successful dividend implementaGon in…
  12. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 12
    ASSET BASE PEACE RIVER AREA Montney 1ght oil 13,000 Boe/d Northern Gas (Bluesky) (55%+ Oil & NGLs) EDMONTON AREA Peace River Area Basal Viking 1ght oil (Montney) 7,600 Boe/d ALBERTA (75% Oil & NGLs) Deep Basin…
  13. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 13
    ASSET BASE LOOKING FORWARD 2014 Upcoming AcGvity Peace River Area 43 Montney wells planned for 2014 EOR acGvity iniGated in 2013 with expansion planned for 2014 Edmonton Area 43 Viking wells planned for 2014 EOR acGvity…
  14. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 14
    PEACE RIVER Normandville & Girouxville Montney Plays ALBERTA Normandville T79 Montney Gght oil; 950m verGcal well depth SubstanGal producGon growth in Normandville and Girouxville areas T77 Sept 2011 4,500 Boe/d (25%…
  15. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 15
    EDMONTON AREA Redwater Viking Play T59 Basal Viking Gght oil development Redwater T58 - 700m verGcal well depth Current producGon 5,400 Boe/d (90% liquids) T57 Light oil (38 API) T56 Strong netbacks, moderate…
  16. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 16
    DEEP BASIN - WAPITI Cardium Play ALBERTA T70 Elmworth T69 Cardium Gght liquids-rich natural gas formaGon T68 - Moderate depths (1,000m to T67 1,600m verGcal well depth) Wapi1 Current producGon 5,100…
  17. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 17
    DEEP BASIN - PINE CREEK Cardium Play ALBERTA T56 Cardium Gght oil development - 1,800m-1,900m verGcal Pine Creek well depth T55 Light oil (41 API) Current producGon of 750 Boe/d (20% liquids) Edson Strong…
  18. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 18
    BOYER Natural Gas ALBERTA T110 Bluesky natural gas Current producGon 18.0 MMcf/d T108 Shallow decline gas (8%/year) 710,000 net acres T106 Current drilling density less than Boyer 1.5 wells per secGon T104 70…
  19. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 19
    CORE AREA OVERVIEW Peace River Redwater Deep Basin Deep Basin Northern Gas (Normandville (Redwater & Long Run Total - Wapi1 - Pine Creek (Boyer) & Girouxville) Bruderheim) Current ProducGon (Boe/d) 10,000 5,400 5,100 750…
  20. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 20
    CORE AREA WELL ECONOMICS Peace River Redwater Deep Basin Deep Basin Montney Viking Wapi1 Cardium Pine Creek Cardium 250 72 410 350 IP 30 (Boe/d) (65% liquids) (91% liquids) (20% liquids) (56% liquids) 140 36 265 184 IP 365…
  21. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 21
    TYPE CURVES 300 Long Run Montney Hz Oil Long Run Viking Hz Oil 80 250 73 Wells 70 Total ProducGon (Boe/d) 200 60 Total ProducGon (bbl/d) 50 150 50 Wells 40 100 26 Wells 30 15 Wells 20 50 10 0…
  22. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 22
    ENHANCED OIL RECOVERY (EOR) Waterood Cost eecGve reserve addiGons Current Waterood Pilots Increased recovery of Area Forma1on Pilot Start Date Comments Lowers nding & Injectors development costs Proceeding with EOR…
  23. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 23
    LONG RUN KEY VALUE DRIVERS Diversied asset base within the Western Canadian Sedimentary Basin; balanced between oil and natural gas producGon Asset base well posiGoned to support sustainable dividend model without dividend…
  24. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 24
    APPENDIX 24
  25. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 25
    2014 FORECAST NET CAPITAL SPENDING Capital Expenditures (MM) Well capital 150 Plants/ FaciliGes/ EOR 50 RecompleGons, G&G, Land, Abandonment 30 Capital Expenditures 230 Net Acquisi1ons / (Disposi1ons) 220 Net Capital…
  26. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 26
    Q1 2014 NETBACKS BY PLAY Peace River Redwater Northern Montney Viking Gas Total Produc1on (Boe/d) 10,637 6,101 2,732 16.4 25,613 MMcf/d % Liquids 62 80 0 56 Oil Quality 28 API 38 API - - 32 API Field Netback…
  27. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 27
    RISK MANAGEMENT Crude Oil Costless Collars Volume Pricing Financial hedges miGgate January 1, 2014 June 30, 2014 1,000 Bbl/day WTI US 95.00 - 98.00/Bbl risk associated with January 1, 2014 December 31, 2014 2,000 Bbl/day WTI US…
  28. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 28
    RECENT A&D TRANSACTIONS ACQUISITIONS DIVESTITURES Total Total Cost Produc1on Produc1on Date Area Date Area Proceeds (MM) (Boe/d) (Boe/d) (MM) West Central February 2013 Peace Area 7.5 100 December 2012 175.9 1,900…
  29. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 29
    PEACE RIVER MONTNEY Normandville/Girouxville ALBERTA Current development focus areas Normandville T79 are Normandville and Girouxville Montney oil Normandville Oil Barery IniGated water injecGon pilot in Q2, 5,000…
  30. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 30
    PEACE RIVER MONTNEY Have drilled 3 secGons at 8 wells per secGon Historical Type Curve spacing with no interference 300 250 73 Wells Expanding water ood pilots during 2014. With success, full implementaGon will begin in…
  31. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 31
    REDWATER VIKING 07-21 Redwater North Oil Barery T59 Viking oil horizontal mulG-frac 5,000 bbls/d play 4.0 mmcf/d Control of infrastructure to 05-17 Redwater North Compressor Sta1on Redwater T58 maximize operaGng…
  32. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 32
    REDWATER VIKING Historical Type Curve Development drilling at 16 wells per 80 secGon for opGmal drainage 70 60 Implemented iniGal water injecGon Total Produc1on (bbl/d) 50 scheme in December 2013, expanding in 40…
  33. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 33
    CHERHILL Emerging Play ALBERTA Primarily targeGng Ban and Lower T60 Mannville formaGons True verGcal depth of 1,000 - 1,500 meters T59 T58 Current producGon of approximately 1,500 Boe/d (40% T57 liquids)…
  34. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 34
    DEEP BASIN - WAPITI CARDIUM Horizontal Type Curve Economics Historical Type Curve Property acquired on May 30, 2014 500 400 Liquids-rich gas (40 bbl/mmcf) Total ProducGon (Boe/d) 300 90,000 net acres 200 82…
  35. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 35
    DEEP BASIN - PINE CREEK CARDIUM Horizontal Type Curve Economics Historical Type Curve Property acquired on May 30, 2014 500 28,000 net acres 14 booked locaGons 400 Total ProducGon (Boe/d) 300 Average 77% working…
  36. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 36
    RESERVES SUMMARY Consensus Pricing RESERVES 12/31/2013 Oil Gas NGL Total NPV00 NPV10 NPV15 FDC MBbls MMcf MBbls Mboe M M M M LRE PDP 12,997 130,593 2,310 37,073 923,929 691,192 620,981 - TP 24,676 207,633 3,411 62,692…
  37. INVESTOR UPDATE – Long Run Exploration Ltd. – slide 37
    CORPORATE INFORMATION TSX:LRE Contacts Bill Andrew Chair & CEO (403) 261-6012 Dale Miller President (403) 261-6012 Corine Busheld Vice President, Finance & CFO (403) 261-6012 Jason Fleury Vice President, Business…

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