CAPP Investment Symposium 2011 June 2011 June 2011 Page 1
Corporate Highlights Advantage now a pure play Montney natural gas resource company Pro forma Advantage production 23,500 boe/d Q2 2011 Oil weighted assets sold to Longview Oil Corp. (AAV 63% ownership) Capex program focused on…
Advantage Pure Play Natural Gas Focus Company Total Montney Unconventional March Exit Production : 24,300 boe/d March Exit Production : 16,600 boe/d Gas/Oil % : 100/0 Gas/Oil % : 92/8 Avg. W.I. : 93% Liquids Rich Multi-zone CBM…
Glacier Montney Development Dominates 2P Reserves(1) Production : 4,557 boe/d Eastern Alberta Gas/Oil % : 65/35 RLI 12.8 Avg. W.I. %: Gas/Oil % 94/6 Western Alberta RLI 12.7 Glacier Gas/Oil % 68/32 RLI 31.7 Gas/Oil % 100/0 8%…
Glacier Development Driving Organic Production Growth Glacier Phase III results exceeded Advantage Pro forma Production(1) expectations: (boe/d) 24,000 Glacier production exited March 2011 at 95% Production Growth 16,600 boe/d…
Glacier Thick Montney Siltstone Supports Higher Reserve Recoveries Unconventional Marcellus Glacier Shale Horn River Edmonton Shale Barnett Calgary Shaley silts Haynesville Arc Silt Shell Birchcliff Most active drilling…
Glaciers Location Provides Technical & Economic Benefits BC AB Glacier is located in Alberta and is within the over-pressured and extremely thick Montney siltstone fairway with Upper, Middle & Lower Montney Potential A 100 km A…
Glacier - Drilling Results and Production Growth Phase III Upper Montney Test Rates mmcf/d(1) Recent delineation drilling results confirm high quality reservoir across Glacier Production Growth our land block 100 mmcf/d Phase III…
Glacier Improved Well Production Thru Frac Optimization Upper Montney Horizontals Normalized 30 Day IP Average Production Rate per Well 6000 32 recent wells with 9 fracs/well 5000 1 year cumulative 0.9 bcf Glacier well…
Glacier 2P Reserves Exceed 1.0 Tcf(1) 2010 Finding and Development costs 9.29/boe (3 year F&D 10.75/boe)(2) Significant future potential to add reserves in the Upper, Middle and Lower Montney 1.04 Tcf 0.82 Tcf Probable…
Glacier Value Growth(1) Glaciers asset value grew 19% to 1.4 Billion at YE 2010 despite a 25% reduction in Sproules natural gas price forecast for the years 2011 through to 2015 1.40 Billion 1.16 Billion 0.30 Billion…
2011 Pro forma Advantage Cash Flow Summary (000s) Daily production (boe/d)(1) 23,353 Gas/Oil % 92/8 Operating income(1) 147,512 Hedging gains 26,212 G&A and capital taxes(2) (19,900) Interest and financing expenses (7,400)…
Low Cost Structure Advantage 2011 Operating Netbacks(1) /boe /mcfe Revenue 25.36 4.23 Cost structure expected to rank in the top quartile Royalties 10.2% (2.58) (0.43) among the intermediate sector Operating Costs (5.48) (0.91)…
Significant Debt Reduction Total Debt has been reduced by 69% since 2008 807 million 469 million 440 million 57% 251million 2008 YE 2009 YE 2010 YE Q1 2011 Pro-forma Convertible Debentures Bank Debt June 2011 Page 16
Advantage - Current Enterprise Value Analysis Shares (million) ( million) Advantage Shares 8.15/share(1) 165 1,345 Current Total Debt 251 Total Enterprise Value 1,596 Less non-Glacier Assets ( 410) (Pv 10% pre-tax, Sproule) (2)…
Advantage Summary Glacier production grows to 100 mmcf/d March 2011 Exit Rate Additional 100 mmcf/d of production behind pipe will offset declines for most of 2011 2P RLI 29 years Pro forma cash flow of 164 million for 2011(1)…
Appendix June 2011 Page 20
Montney Reserves/Well Could Exceed Expectations due to Silt/Sand Reservoir Barnett Shale Horizontal vs Montney Horizontal Montney type well Swan (based on 50 wells that have the longest production history) Barnett Shale…
Top Quartile Initial Production Rates (30 day) at Glacier To date results at Glacier prove up a Glacier Production Growth to significant amount of acreage across the land 50 mmcfd in 20 months block and IPs are comparable to EnCana…
Montney Horizontal Well Production Range and Type Curve Data includes Glacier, Swan, Tupper, Pouce Coupe South & Groundbirch The IP30 range and average type curve based on 320 wells with up to 48 months of production…
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