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FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp.

Harvest Operations Corp. · May 20, 2015 · 23 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. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 1
    Corporate Presentation February 2015
  2. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 2
    Our Business Canadian-based subsidiary of Korea National Oil Corporation (KNOC) 233 MMboe of Proved reserves (79% liquids)1 464 MMboe of 2P reserves of (85% liquids)1 Hay River Significant undeveloped land of 661,568 net acres2…
  3. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 3
    Our History Formed in 2002 as an energy royalty trust Harvest acquired by KNOC in 2009 Transitioned from a trust to an exploration and production company in 2010 Acquired BlackGold Oil Sands project in 2010 Acquired the Canadian…
  4. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 4
    Our Distinction Strong Parent in KNOC Investment grade credit rating: A+ (S&P) / Aa3 (Moodys) Demonstrated support Opportunistic Growth Significant inventory of drilling opportunities Sustainable organic development Efficient and…
  5. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 5
    Our Parent Korea National Oil Corporation KNOC was established in 1979 & is wholly owned by the Republic of Korea KNOCs mandate is to mitigate the impact of oil prices on the Korean economy through worldwide ownership and production…
  6. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 6
    Our Value to KNOC KNOC KNOC Oil and Gas Production1 Production: 221,886 boe/d 2P Reserves: 1,329 MMboe Harvest 27% 24% Harvest Other 76% Production: 52,473 boe/d 2P Reserves: 464 MMboe KNOC Oil and Gas 2P Reserves1 Upstream…
  7. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 7
    KNOCs Demonstrated Commitment Harvest is KNOCs Canadian investment vehicle KNOC has contributed more than 3.0 billion1 through equity injection, related party loans and guaranteed debt 3,500 Guaranteed US Sr. Notes Debt Related…
  8. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 8
    Our Strategy Harvests assets are sorted into: Core Growth Areas Established six Core Growth Areas Primary focus is to achieve future reserves, production and value growth Growth through drill bit and strategic acquisitions…
  9. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 9
    Hay River Strategic Value & Potential BCs single largest oil property 100% working interest Multi-well development from pads Technology leader in horizontal development of oil reservoir HOC skilled at large-scale, narrow-window…
  10. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 10
    Red Earth Strategic Value & Potential Dominant player in the area Horizontal, stage fractured Slave Point wells Additional completion targets: o Gilwood oil o Granite Wash oil Secondary recovery opportunities Development…
  11. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 11
    Cecil & Royce Strategic Value & Potential HOC primarily 100% south of the river Technology leader in drilling thin oil reservoirs horizontally Development Charlie Lake formation: 25o API crude oil Future zones: o Montney…
  12. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 12
    SE Saskatchewan Strategic Value & Potential Strong operating and infrastructure presence Predictable, repeatable drilling costs High netback light oil Development Tilston and Souris Valley formations: 33o 35o API crude oil…
  13. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 13
    Deep Basin Strategic Value & Potential KERR JVs: Deep Basin Partnership and HKMS Partnership Capture value upside from higher gas prices West Coast export potential for LNG and NGLs Development Liquids-rich natural gas in Fahler,…
  14. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 14
    Deep Basin Midstream JV Bilbo Gas Plant 50mmcf/d refrigeration gas processing and condensate stabilization plant Capability to expand to 75mmcf/d Began construction in 2014 Nat gas delivered into TCPL Pipeline spec C3 and C5 for…
  15. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 15
    West Central Alberta Strategic Value & Potential Capture value upside from higher gas prices Primarily liquids-rich natural gas Development Mainly targeting the Cardium, Glauconite, Ostracod, and Notikewin formations Corporate…
  16. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 16
    BlackGold Oil Sands Project - Phase 1 10,000 bbl/d SAGD oil sands project Great neighbourhood CVE Christina Lake MEG Christina Lake Devon Jackfish Phase 1 complete Q1 2015 Two well pads completed at end of 2014 Staged…
  17. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 17
    BlackGold Oil Sands Project Phase 2 Regulatory approval received in 2013 Expansion within the footprint of the Phase 1 site Project costing underway Additional 20,000 bbl/d production capacity Capital pre-invested during Phase 1…
  18. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 18
    Non-Core Dispositions Below is a summary of material non-core dispositions in 2014: Divestments (including swaps) Proceeds Production ( Millions) (BOE/D) Sold in Q1 2014 (1 property) 6.0 0 Sold in Q2 2014 (1 property) 2.3 43 Sold…
  19. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 19
    Capital Structure KNOC ownership & demonstrated equity and financial support provides substantial benefit Bank Debt 18% 45% 6% Senior Notes 12% Equity 15% 10% 2% Senior Notes Related Party Loans As at September 30,…
  20. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 20
    Bank Debt 1.0 billion syndicated revolving credit facility with 11 banks Maturity April 30, 2017 547.6 million1 drawn on a 1.0 billion facility Subject to financial covenants: Covenant September 30, 2014 Senior Debt2 to EBITDA 3.0…
  21. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 21
    Publicly Traded Debt 6% US Senior Unsecured Notes US500 million principal amount Interest payments occur semi-annually on April 1 and October 1 Issued in October 2012 and mature on October 1, 2017 CUSIP: 41754WAN1 2% US Senior…
  22. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 22
    Financial Objectives Preserve and strengthen balance sheet Major capital projects and acquisitions supported by cash flow, proceeds from non-core asset sales and a conservative mix of debt and funding from KNOC Selectively hedge…
  23. FEBRUARY 2015 CORPORATE PRESENTATION – Harvest Operations Corp. – slide 23
    Conclusion Long-life assets Suite of attractive investment opportunities Conventional Oil Sands Cash flow diversification from multiple assets Sound economic fundamentals for long-term growth Strong demonstrated financial support…

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