What is Connacher SAGD conventional producer bitumen heavy oil refiner producer Petrolifera Petroleum (TSX: PDP) 19% equity ownership Connacher 2010 Investor Presentation 4
Where is Connacher SAGD Bitumen AB SK Conventional Calgary MT Heavy Oil Refining Connacher 2010 Investor Presentation 5
Oil Sands Major Asset Holdings in main Athabasca Quigley Great oil sands fairway Divide SAGD bitumen producer Highway 63 and infrastructure bisect major assets Pod One Algar Fort McMurray Great Divide Edmonton…
Key Facts(1) 429 million shares outstanding Market capitalization: 550 million Enterprise Value: 1.4 billion Pre-tax NAV: 2.9 billion 52 week Hi-Lo: 1.88 - 0.76 On average, 3 million shares traded daily (TSX) 1) As at…
Key Investment Attributes (1) Were Were oily. producing. Were Were integrated. growing. 1) Refer to slide 2 for forward looking information disclaimer Connacher 2010 Investor Presentation 8
Five Year Track Record of Production Growth Annual Production (boe/d) Key Investor Issue - Financial Position and Outlook 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 2005 2006 2007 2008 2009 2010F(1)…
Five Year Track Record of Adding Value(1) Bitumen PV 10% (mm - before tax) 4,000 3,500 Proved Probable Possible 3,000 2,500 2,000 1,500 1,000 500 0 Dec. Dec. Dec. Dec. Dec. June 2005 2006 2007 2008 2009 2010 26 C/H 75 C/H…
Five Year Track Record of Adding Reserves(1) Bitumen Reserves (mmbbl) 700 600 Proved Probable Possible 500 400 300 200 100 0 Dec. Dec. Dec. Dec. Dec. June 2005 2006 2007 2008 2009 2010 26 C/H 75 C/H & 3D 134 C/H &…
We Manage Risk(1) Upstream natural gas Mitigates key oil sands operating cost Downstream heavy oil Recaptures heavy crude oil differential refining Hedging Stabilizes cash flow Project scale Controls construction cost and…
Key Investor Considerations Production Reliability
Pod One Plant Inlet Building & Boiler Oil Process Evaporator Feed Water Tanks Heat Building Towers Well Pad Exchangers Tank Farm & Trucking Evaporator Steam Generators 101 Facility Tank Building Buildings Connacher 2010 Investor…
Pod One Reliability is Our Goal m3=6.29/bbl 2010 average production target Turnaround Evaporator Power bump Power bumps Instrumentation power bumps maintenance ESP installation ESP failures ESP failure ESP failures…
Pumps Reduce SORs Steam Bitumen bbl/d SOR bbl/d 27,173 2.7 10,064 27,173 3.0 9,058 27,173 3.3 8,234 27,173 3.5 7,764 1H 2010 average SOR for wells on pump 2.9 1H 2010 average SOR for all wells - 3.7 Includes steam…
Pod One Optimization 13 wells on pump(1) Expect pumps in 17 of 19 wells in Aug 2010(1) New wells (13 and 14) both on production by Sept 2010(1) Forecast 2010 average production of 7,200 bbl/d at Pod One(1) Projected 2010 exit…
Connacher is Innovating Now(1) 10 3 Connacher is actively pursuing SAGD innovations Goal: reduce SORs; increase operational reliability, recovery and production; improve cash flow and add value 1) Refer to slide 2 for…
Algar Project Update Construction Pod One completed ahead of schedule, under budget Currently converting Algar Well Pads wells to full SAGD Projected 2010 exit rate at Algar of 7,000 bbl/d - 7,500 bbl/d(1) Algar Plant…
Steam In, Oil Out Algar is designed for more efficient delivery of steam during circulation stage Connacher 2010 Investor Presentation 20
Production Ramp-up Comparison(1) Comparison of Production Ramp-ups 100% 90% Connacher Pod One Actual MEG Christina Lake Actual Connacher Algar 80% 70% Rate Normalized by Design Rate Algar forecast 2010 exit 60%…
Cogeneration Plant at Algar (1) September 2010 start-up Expected to enhance Algar and Pod One production reliability 1) Refer to slide 2 for forward looking information disclaimer Connacher 2010 Investor Presentation 22
Key Investor Considerations Growth Plan
Reserves = Growth(1) 30/06/10 30/06/10 mmbbl 10% PV mm Proved Reserves (1P) 182 1,345 Proved and Probable Reserves (2P) 502 2,702 Proved, Probable and Possible Reserves (3P) 606 3,383 Best Estimate Contingent Resources 223 422…
Near Term Expansion Great Divide Expansion Project: Great Divide EIA submitted Proposed capacity expansion from 20,000 bbl/d to 44,000 bbl/d(1) Pod One Algar Anticipate late 2011 approval(1) Target to start expansion in…
Oil Sands Production Profile(1) 60000 50000 3P 40000 3P bbl/d 2P 30000 20000 10000 1P 1P 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Based on 3P Reserves (1) 45,000 bbl/d by 2015; 56,000 bbl/d by…
Exploration Sustains Growth Systematic leasehold Great evaluation Quigley Divide Q1 2010 81 coreholes (gross) and 3D seismic Added 81 mm barrels of 2P Pod One Algar bitumen reserves Thornbury and value in 2010 from targeted…
Key Investor Considerations Financial Matters
Balance Sheet Appropriate For Growth As at June 30, 2010 millions Cash 64 Long Term Debt 888 58% Shareholders Equity 643 42% Total Long Term Debt plus Equity 1,531 100% Long Term Debt issued to pre-fund major projects No…
Strong 2010 Forecast Production, Netbacks and Adjusted EBITDA(1) Bitumen Production Total Bbl/d - annualized 9,000 Bbl/d exit rate 15,500-16,500 Million bbls - annualized 3.3 Netbacks and Adjusted EBITDA /bbl of bitumen…
Revised 2010 Cash Capital Budget(1) 1H 2010 millions Actual FY 2010 Upstream Algar, including facility optimization 64 72 Algar capitalized items 34 48 Pod One, including trucking terminal expansion 18 31 Cogeneration, sales…
Connacher is Valuable(1) Estimated Pre-tax Net Asset Value millions Proved + Probable + Possible Reserves (3P) (2) 3,532 Land Value (3) 12 Book Value of Refinery (5) 87 Investment in Petrolifera (4) 17 Working Capital (5) 100…
CLLs Bitumen Resources Potential for Free Further Growth(7) 30/06/10 30/06/10 mmbbl mm (6) per share (8) Low Estimate Contingent Resources (1)(3) 216 587 1.37 Best Estimate Contingent Resources (1)(4) 223 422 0.99 High Estimate…
Conclusion: Why Own Connacher(1) Valuable Plan to Get There 50,000 bbl/d by 2015 Double Production in 2011 Algar On-Stream in 2010 Growing Productive Undervalued Capacity Expanding Reserve Base 1) Refer to slide 2 for…
Appendix - Additional Slides
Experienced Management Team Name Title Experience Richard A. Gusella Chairman & President, CEO and a director of Connacher since May 2001, MA (Economics) Chief Executive Officer Approximately 40 years industry experience Peter D.…
Large Producing Bitumen Reserve Base(10) 30/06/10 30/06/10 mmbbl mm (9) Proved Reserves (1P) (1) 182 1,345 Proved and Probable Reserves (2P) (1)(2) 502 2,702 Proved, Probable and Possible Reserves (3P) (1)(2)(3) 606 3,383 Low…
Consistent, Repeatable Execution Plan Pod One After land acquisition in Q1 2004 Place On- Algar Build stream Project Regulatory Approval Place On- Build stream(1) Regulatory Project(1) Approval Fastest in Sector…
Efficiency of Small Scale Operations Construction program on time and on budget Incorporates learnings and new technologies Reduces exposure to inflation Allows for efficient brownfield expansion(1) 1) Refer to slide 2 for…
Algar SAGD Well Pairs - Circulation Phase Typically 60-90 days in duration Connacher 2010 Investor Presentation 40
Algar SAGD Well Pairs - Semi-SAGD Phase After completion of circulation phase Typically less than one week in duration Connacher 2010 Investor Presentation 41
Algar SAGD Well Pairs - Full SAGD Phase Typically 6-8 years of full SAGD production; wells could produce for an additional 2-3 years because of downhole temperatures and pressures(1) 1) Refer to slide 2 for forward looking…
Typical SAGD Life Cycles Potential Potential infill well infill well Circulation Peak SAGD Production Declining SAGD Production 90 days 12 - 18 months 4 to 6 years Connacher 2010 Investor Presentation 43
Upstream Conventional Assets 1H 2010 average production 9.5 mmcf/d natural gas, 921 bbl/d crude oil; 2,500 boe/d Natural gas provides notional hedge; contributes cash flow and credit capacity Further development potential behind…
Downstream Asset Montana Refinery 9,500 bbl/d heavy oil refinery located in Great Falls, Montana Captures much of the heavy oil price differential Produces gasoline, middle distillates and asphalt Source of diluent supply for Pod…
Hedging Stabilizes Cash Flow Crude Oil Hedges (CLL is long crude oil) WTI Swaps: US78/bbl on 2,500 bbl/d for calendar 2010 US86.10/bbl on 1,000 bbl/d from Jan-Mar 2011 US88.10/bbl on 1,000 bbl/d from Jan-Mar 2011 US85.25/bbl on…
Strong Bitumen Netbacks (1) (2) The following table sets forth the revised estimated average 2010 bitumen netbacks for combined Pod One and Algar /bbl of bitumen Bitumen Price at Wellhead 47.18 (3) (4) Royalties (1.79) (5)…
Integrated Operations Lead to Better Netbacks(1) (2) /bbl of millions Revised 2010 Estimate bitumen Bitumen Netback 27.85 (3) 91 Conventional Netback 6.00 (4) 20 Refinery Netback 6.05 (5) 20 Realized Loss on Risk Management…
Balance Sheet Geared to Growth As at June 30, 2010 millions Cash 69 Long Term Debt US200mm Senior First Lien Notes due July 2014 - 11.75% 195 US587mm Senior Second Lien Notes due Dec 2015 - 10.25% 603 100mm Convertible Debentures…
Common Shares Offer Excellent Liquidity Common share price Q3 Q4 Q1 Q2 2009 2009 2010 2010 High 1.15 1.33 1.65 1.88 Low 0.76 0.94 1.16 1.20 Close 1.10 1.28 1.49 1.29 +17% Volume of common shares traded 129,206 207,978 167,483…
SAGD Oil Sands Greenhouse Gas Emissions (1) GHG from SAGD oil sands are generally comparable to domestic US and imported crude oil, on a life-cycle basis Connacher is reducing its GHG footprint 1) Refer to slide 2 for forward…
Oil Sands Emissions Versus Coal Connacher 2010 Investor Presentation 53
Connachers Environmental Report Card(1) Small footprint Pod One < 2% of Manhattan Island Efficient water usage Sourced from non-potable sub- surface aquifer 1) Refer to slide 2 for forward looking information disclaimer.…
Connacher Oil and Gas Limited 403.538.6201 inquiriesconnacheroil.com www.connacheroil.com
Loading...
