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SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc

Surge Energy Inc · Nov 14, 2012 · 45 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. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 1
    Q3 2012 INVESTOR UPDATE November 2012 TSX:SGY
  2. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 2
    Overview Surge Snapshot Q3 2012 Highlights Operations Update Longer-Term Growth Initiatives Waterflood and Exploration & Land Acquisition Update
  3. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 3
    Surge Energy Inc. Corporate Profile LISTING MARKET CAPITALIZATION TSX: SGY 550 million(1) OIL DRILLING INVENTORY NET UNDEVELOPED LAND 570 gross (435 net) 500,000 acres BASIC/FULLY DILUTED SHARES O/S BASIC/FULLY DILUTED INSIDER…
  4. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 4
    Core Operating Areas WESTERN ALBERTA SOUTH EAST ALBERTA WILLISTON BASIN Percent of Reserves: 70% 20% 10% Percent of 2012 Capex: 50% 20% 30% Net Undeveloped Land: 260,000 acres 138,000 acres 98,000 acres Remaining Oil Drilling…
  5. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 5
    Western Alberta Key Properties Nipisi Valhalla South Grande Prairie (Service Hub) Goose River Windfall Whitecourt 30 miles (Service Hub) Surge Core Properties Valhalla South and Nipisi Represent 50% of Surges Recent…
  6. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 6
    Q3 2012 Summary Q3 Production of 8,292 boe/d vs. expectations of 9,150 boe/d 525 boe/d related to changing completion techniques at Nipisi 450 boe/d related to delayed drilling and production outages at Valhalla Q3 Funds Flow per…
  7. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 7
    2013E Hedging Program Surge has one of the strongest risk management programs in its peer group Oil & Liquids Hedging (As a % of Oil & Liquids Production) 40% 110 37% 35% 105 32% 30% 100 Average Floor Price / Bbl (C)…
  8. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 8
    Revised 2012 Guidance (1) (2) REVISED PREVIOUS PRODUC TION Exit 2012 Production (boe/d): 11,000 (73% oil and NGLs) 11,000 (77% oil and NGLs) Average 2012 Production (boe/d): 9,100 boed (70% oil & NGLs) 9,750 (72% oil and NGLs)…
  9. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 9
    Western Alberta - Nipisi/Gift (Slave Point/Gilwood) Analogue Slave Point Waterflood Overview: 115 mmbbls gross (115 mmbbls net) DPIIP (35-42 degree API) in the Slave Point Formation (1) Current oil…
  10. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 10
    Nipisi (Slave Point) Operations Update Highlights: Confirmation of increased DPIIP: Successfully drilled down dip of the oil/water contact zone, increasing the DPIIP in the main block from 65 mmbbls to 85 mmbbls. 6 Optimization…
  11. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 11
    Slave Point Well Results Wells 1&2 600.0 Wells 1 & 2 were completed with Pump Change nitrified foam and water. 500.0 Both wells outperformed the companys best 30 day average Production Rate ((bbls/d) 400.0 production rate of…
  12. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 12
    Nipisi (Slave Point) Frac Optimization Nipisi Frac Methodology The modified frac design has been successful and resulted in: Original Frac Modified Frac Design Design The ability to consistently execute (Wells 1&2) (Wells 3 to 9)…
  13. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 13
    Nipisi (Slave Point) Revised Type Curve 500 Key Metrics: (1) 450 Best Month Average 250 bbls/d (100% oil) 400 Production Rate: Reserves/Well: 240 mboe (100% oil) Production Rate ((bbls/d) 350 NPV/Well : 4.8 MM 300 Profit/…
  14. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 14
    Western Alberta Valhalla South/Wembley (Doig) Overview: (1) Valhalla South (Doig) Valhalla South DPIIP increased by 15% to 115 mmbbls net (40 degree API light oil) from 99 mmbbls net At Wembley, acquired 18 mmbbls gross/net DPIIP…
  15. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 15
    Continuing to Capture Doig Light Oil Wembley Overview: VALHALLA SOUTH DOIG LOG WEMBLY DOIG LOG (100/16--31 (100/16 31--74 74--8w6) (100/8--28 (100/8 28--72 72--8w6) 18 mmbbls gross (18 mmbbls net) DPIIP (40 degree API)…
  16. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 16
    Williston Basin (Spearfish) Overview: Pierson (1) Waskada 202 mmbbls gross (150 mmbbls net) DPIIP (36 degree API) CANADA Goodlands Current oil…
  17. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 17
    100% Drilling Success in North Dakota Area Operators: ARC Resources CNRL EOG Hess Legacy Penn West Petrobakken Renegade Surge Hz multi-frac Spearfish wells Spearfish light oil play continues to be delineated in North…
  18. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 18
    Summary of Unbooked Oil Drilling Locations Internally Net Estimated Estimated Unbooked Rates of NPV10 BT Per FD Capital / Unbooked NPV10 BT/ Oil Reserves Oil Hz Return Additions(2)(3) Share(4) Well Oil Adds Well(2) / Well(5)…
  19. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 19
    Waterflood Portfolio Exposure to 505 mmbbls of DPIIP…
  20. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 20
    Western Alberta Windfall (Bluesky) Overview: 60 mmbbls gross (60 mmbbls net) DPIIP (1) (36 degree API light oil) Current oil…
  21. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 21
    Windfall 2012 Hz Well Pilot Waterflood Surge Land Bluesky Cumulative Oil Recovered Surge Horizontal Producing Wells 9-9-59-15 W5 Horizontal Injector Highlights: Commenced injection into Surges 9-9-59-15W5 well on Sept 25,…
  22. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 22
    South East Alberta (Cretaceous Sands) Overview: Silver Low-decline, high ROR assets that provide reliable base cash flow. 65 mmbbls gross (65 mmbbls net) DPIIP(1) (27-29 degree API). Current oil…
  23. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 23
    Silver Lake (Createceous Sands) Waterflood Progress Highlights: 16 mmbbls DPIIP with an estimated ultimate recovery factor of 40%. Under waterflood since 2007. Increased the injection and facility water handling capacity by 100% to…
  24. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 24
    Waterflood Upside 46 mmbbls Recovery Potential from Successful Waterfloods Net DPIIP Cumulative Oil Recovered Primary Recovery Incremental Secondary Area Formation (mmbbls) To Date (%) (mmbbls/%) Recovery (mmbbls/%)(1) Valhalla…
  25. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 25
    Exploration & Land Acquisition Update Continue to gain momentum in several exploration plays. Gained access to over 150 million barrels of DPIIP through various land sales, purchases and farm-ins in the WCSB during Q3 and Q4 2012.…
  26. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 26
    Summary UNBOOKED OIL ADDS FROM WATERFLOODS 23 mmbbls CURRENT 2P 37 mmbbls UNBOOKED OIL ADDS 46 mmbbls OIL & NGLS RESERVES FROM DRILLING INVENTORY 1. Potential to triple company oil reserves and double net asset value. 2.…
  27. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 27
    Q3 2012 INVESTOR UPDATE Appendix 28
  28. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 28
    Summary of Recent New Releases November 13, 2012 - Third quarter 2012 results and operations update. August 8, 2012 Record production and funds flow in the second quarter of 2012. May 9, 2012 Record first quarter 2012 results;…
  29. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 29
    Surge Energy Inc. Business Plan EVOLVE INTO A TOP TIER INTERMEDIATE LIGHT OIL PRODUCER Acquire & Develop U N D E R E X P LOI T E D O I L R E S O U R C E P L AY S Identify Optimize & Capture Oil Recovery NEW OIL I N C LU D…
  30. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 30
    Compound Annual Growth Rate of 75% from April 2012 to September 2012 11,000 10,000 9,000 Valhalla South Acquisition 8,000 7,000 North Dakota Acquisition Organic 6,000 Corinthian Acquisition Growth 5,000 BOE/day 4,000…
  31. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 31
    Growth per Share Achieved 125% CF/share growth in 2011 and forecasting significant CF/share growth in 2012 /d)/MM shares basic and fully diluted Production Reserves Cash Flow Cash Flow per share basic and fully diluted…
  32. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 32
    Proforma Net Asset Value (NAV) as at Dec. 13. 2011 Proved Plus Probable Reserve Value (MM) 723.8 (Including Future Development Capital)(1) Undeveloped Land (MM) 63.6 (509,079 acres 125/acre) Estimated Net Debt (MM) (unaudited)…
  33. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 33
    CAD WTI Hedging Surge Q4 2012 Oil Hedges: 61% of forecast oil production (after royalties) hedged with 70% participation and an average floor price of 89.94. 2,000 bbls/d Edmonton Light to WTI oil differential hedged at par. 5,000…
  34. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 34
    AECO Hedging Natural gas hedged at 3.40/mcf for 2013 and 3.80/mcf for 2014 12,000 4.00 3.75 10,000 3.50 8,000 Gas volume currently 3.25 hedged (GJ/day) Gas price GJ/day in mcf 6,000 3.00 Average swapped price…
  35. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 35
    Oil Differential, Natural Gas, Power and Interest Rate Hedge Summary Heavy Oil Differential Period Volume in bbls/day Differential Swap Hardisty Stream (Cdn/bbl) Index Jul. 1 to Sep. 30, 2012 500 20.25 WCS Oct. 1 to Oct. 31, 2012…
  36. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 36
    Valhalla South (Doig) Type Curve and Key Metrics 700 (1) Key Metrics: 600 Best Month Average 620 boe/d Production Rate: (76% oil and NGLs) 500 670 mboe Reserves/Well: (53% oil and NGLs) Production Rate 400 NPV/Well :…
  37. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 37
    Average Valhalla South Horizontal Achieving Type Curve Performance after 270 days of Production 3,000 HZ 1 HZ 2 Production Rate (boe/d) Normalized Total BOE HZ 3 HZ 4 2,500 HZ 5 HZ 6 HZ 7 HZ 8 2,000 HZ 9 HZ 10 Average Surge…
  38. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 38
    SE Alberta (Cretaceous Sands) Type Curve and Key Metrics 120 Key Metrics: (1) 100 Best Month Average 110 bbls/d (100% oil) Production Rate: Reserves/Well: 100 mboe (100% oil) Production Rate (bbls/d) 80 NPV/Well : 1.9 MM…
  39. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 39
    Windfall (Bluesky) Type Curve and Key Metrics 200 Key Metrics: (1) 180 Best Month Average 185 boe/d 160 Production Rate: (69% oil and NGLs) 250 mboe Reserves/Well: 140 (54% oil and NGLs) NPV/Well : 2.6 MM Production Rate…
  40. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 40
    Waskada (Spearfish) Type Curve and Key Metrics 120 Key Metrics:(1) Best Month Average 100 100 bbls/d (100% oil) Production Rate: Reserves/Well: 70 mboe (100% oil) Production Rate (bbls/d) 80 NPV/Well : 2.1 MM Profit/…
  41. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 41
    North Dakota (Spearfish) Type Curve and Key Metrics 140 (1) Key Metrics: 120 Best Month Average 125 bbls/d (100% oil) Production Rate: 100 Reserves/Well: 70 mboe (100% oil) Production Rate (bbls/d) NPV/Well : 1.2 MM 80…
  42. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 42
    Detailed Economics of Key oil Resource Plays Economic Valhalla South Windfall Nipisi SW Manitoba North Dakota South East Alberta Inputs/Outputs: (Doig) (1) (2) (Bluesky) (1) (2) (Slave Point) (1) (2) (Spearfish) (1) (Spearfish) (1)…
  43. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 43
    Directors and Officers Executive Most Recent Position Dan ONeil President & CEO, Breaker Energy Ltd. President, Chief Executive Officer & Director Dan Brown Chief Operating Officer, Breaker Energy Ltd. Chief Operating Officer…
  44. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 44
    Surge Analyst Coverage Financial Institution Analyst Email Address AltaCorp. Capital Don Rawson drawsonaltacorpcapital.com BMO Capital Markets Jim Byrne jim.byrnebmo.com CIBC World Markets Inc. Arthur Grayfer arthur.grayfercibc.com…
  45. SOCIETE GENERALE FIRSTENERGY CAPITALS ANNUAL ENERGYGROWTH CONFERENCE – Surge Energy Inc – slide 45
    Corporate Partners Advisors National Bank of Canada Bank of Nova Scotia Bankers: Canadian Imperial Bank of Commerce ATB Financial Auditor: KPMG LLP Legal Counsel: Heenan Blaikie LLP Evaluation Engineers: Sproule Associates…

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