FOCUS, SUSTAINABILITY, PROFITABILITY J. P. Morgan Global High Yield & Leveraged Finance Conference, February 2015
Corporate Overview 2 Share Ownership / Capital Structure Management (fully diluted) 22% Canada Pension Plan Investment Board (fully diluted) 78% Term Debt 6.875% Senior Unsecured Notes (due September 2022) US350MM Reserves /…
Our Strategy 3 Maintain focus on scalable, predictable, high netback oil production Achieve sustainable profitable growth through the drill bit and accretive acquisitions Target assets that support low cost operations and…
Sustainable Business Model 4 High netback light oil exploitation play Large, contiguous land position concentrated in the core of the Saskatchewan Viking oil play Light oil-weighted production of 15,000 boe/d1, 90% oil and NGLs and…
North American Crude Oil Play Comparison 5 Payout1 Breakeven Price2 Payout (Years) Breakeven (US/bbl) Sask. Bakken Hz. 2.1 Sask. Bakken Hz. 49.33 Viking Hz. Dodsland 2.3 Viking Hz. Dodsland 49.40 Eagle Ford Oil - East 2.6…
Saskatchewan Viking Exploiting a Light Oil Play 6 Saskatchewan Viking Light Oil Overview WCSB Viking Trend3 Large OOIP, both over a large geographical area and on a per section basis Estimated 6 billion bbls of OOIP from the…
Proven Track Record A Platform for Growth 7 Production Reserves1 14,000 100 12,283 90 12,000 Probable Proved 80 31 Reserves (mmboe) 70 29 Production (BOE/D) 10,000 7,791 60 8,000 50 22 6,000 40 30 58 63 4,000…
Shareholder Value Add Per Share Growth 8 Total Equity Raised: 410 MM 80 75 Net Debt: 464 MM3 70 Total Capitalization: 883 MM 60 56 2014 2P Reserve Value of NPV10 Value: 53 2,060 MM 50 48 43 40 30 24 21 21 20 10…
Reacting to Commodity Prices Focusing on Value 9 Teine continues to deliver an attractive return on capital in the current low price environment Flexible Drilling Program Require 110MM Capital program to maintain flat production…
2015 Outlook Preserving Inventory for the Future 10 Manage growth and preserve the balance sheet Teine 2015 Stay Flat Capital to Maintain YOY Production of 12,300 boe/d2 Drill 130 Viking Hz wells 20 drills in Q1 180 15 re-frac…
Teines Viking Robust Economic Inventory 11 2,900 low-risk Hz Viking oil drilling locations1 Less than 50% of identified locations booked in 2P reserves Teines identified drilling inventory provides it with over 10 years of drilling…
Free Cash Flow Generation 2015 to 2018 12 Teine corporate free cash flow at various production growth rates and WTI prices US60 US70 US80 US90 2018E Production 500 20,000 17,500 2015E-2018E Cumulative After-tax FCF (CMM)…
Cash Flow Neutral Production Growth 13 Annual average production assuming free cash flow neutral drilling program at various WTI prices US60 US70 US80 US90 40,000 33,096 CAGR: 36% Annual Average Production (boe/d)…
Teines Viking Assets An Enviable Position 14 Attractive, virtually contiguous acreage in the core of the Saskatchewan Viking oil play One of the largest Viking light oil producers and Teine Asset Map coveted land position 380,000…
Saskatchewan Viking A Growth Story 15 Significant increase in drilling activity Over 1,100 wells spud in 2013 compared to 100 wells in 2009 New resurgence with the advent of horizontal drilling and multi stage fracing Current…
Teine Viking Well Economics Robust in Current Environment 1 16 Type Curve IRR Sensitivities Assumptions DCET Cost (000s) 850 Oil Price (USD WTI) 40.00 50.00 60.00 70.00 80.00 90.00 100.00 Fixed Operating Cost (/month) 3,000 Tier 5…
Teine Asset Development Plan 17 Teines understanding of the Viking oil play and technical innovation provide a proven competitive advantage Viking Development Early understanding of play enabled Teine to acquire high quality Full…
Focus On Capital Efficiency 18 Teine Well Performance by Vintage Teine Well DCE Costs 80 9,000 1,200 74 69 8,000 70 1,000 920K 90-Day Cumulative Oil Production (bbls) 7,000 850K 60 56 50 6,000 800 30-Day Oil Rate…
Teine Well Performance 19 Recent well performance has exceeded type curves2 used in the Reserve Report Based on Sproule type curves, higher initial production rates correspond to increased ultimate recoveries Teines recent well…
Infrastructure Reducing Costs; Improving Profits 20 Strategy Teine seeks to own, control, and operate strategic infrastructure with the goal of reducing down time, increasing field manpower efficiency, and improving long-term netbacks,…
Potential Future Upside 21 Significant potential incremental recovery from increased well densities and implementation of secondary recovery techniques Increased Well Densities Test and Waterflood Pilot Numerous Viking operators…
Teine Competitive Advantage 22 Teine seeks to continuously improve profitability by both decreasing capital and operating costs and increasing well productivity and overall reservoir recovery Continuously and Adopting and…
25 Appendix
Future Growth in Reserves and Net Asset Value 26 Significant potential for growth in reserves and net asset value as Teine executes its low- risk development plan and current well production performance is recognized Reserve class…
Overview of Reserves 27 Teine has a large light oil focused reserve base Preliminary Sproule December 31, 2014 Commodity Composition Reserve Evaluation 94 MMboe 2P 62 MMboe Proved Reserves Btax Oil NGL's Gas Total NPV10% 14% 14%…
Teine Energy 28 Large, contiguous land position concentrated in the core of the Viking oil play Substantial reserve Experienced base with a multi-year management team drilling inventory Multiyear profitable development…
Corporate Information 29 Board of Directors Bankers Dennis Chorney Chair Jim Howe National Bank of Canada, Syndicate head Avik Dey Adam Vigna Wilmington Trust, Bond Administrator Jeff Donahue Nicholas Zelenczuk David Tuer Neil…
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