Canaccord Genuity Global Resources Conference October 18, 2012
Corporate Profile Q2 2012 average production: 21,474 Boe/d ( 82% gas weighting) 89.8 MM shares outstanding Market capitalization 31.00/share: 2.8 billion 50% insider ownership 1.2 million net acres undeveloped land (December 31,…
Core Areas Average Production (Boe/d) Q2 2012 Kaybob 12,236 Grande Prairie 4,514 Southern 3,059 Northern 1,665 Total Boe/d 21,474 2012 E&D Capital Budget: 475 MM 350 MM in Kaybob 2012 Strategic Investments: 60 MM Build two…
Kaybob Gas Resource CRETACEOUS GAS SANDS OGIP PER SECTION Significant liquids-rich gas 70 Bcf/Section Average OGIP* resource exists within Deep Basin tight sand reservoirs 40160 Bcf per section OGIP* 1.55.0 Bcf EUR per…
Dunvegan Hz Wells Hz Dunvegan well at Resthaven Tested 11.3 MMcf/d* at 6.2 MPa IP: 8.3 MMcf/d Producing 2.4 MMcf/d Cost: 8.3 MM d/c/t 10.00 8.00 Cum Production: 3.8 Bcf Gas Rate (MMcf/d) 6.00 4.00 2.00 0 100…
Falher Hz Wells Hz Falher well at Musreau Tested 16.4 MMcf/d* at 20.8 MPa IP: 12 MMcf/d Producing 3 MMcf/d Cost: 8.6 MM d/c/t 16.0 Raw Gas Prod (MMcf/d) 14.0 Cum Production: 3.6 Bcf 12.0 10.0 8.0 6.0 4.0 2.0 0.0 0…
Falher Production 8
Economics of Kaybob 4.9 Bcf Horizontal Falher Well * * Based on processing through a refrigeration facility 9
Fahler Drilling Time Improvements
Fahler Completion Cost Improvements * * * * * * * Data points not included in trend
Montney Gas Resource Liquids-rich Montney gas play Paramount holds 210 sections (113,000 net acres) of Montney rights 2011 drilling included 5 Hz Montney wells: 15-33 (50% WI) tested over 10 MMcf/d (1) on production; IP 6 MMcf/d +…
Montney Cross - Section 13
Paramount Musreau/Resthaven Montney Lands 1) Please refer to the heading Test Results within the Advisories section of this presentation for further information 2) Internal estimates 14
3.7 Bcf Montney Type Curve 15
Montney Wellbore Placement Placement of the wellbore matters: 1. Penetration rates 2. Accessing the best part of the reservoir 3. Toe up/toe down can effect the long term rates/EURs of the wells 16
Montney Drilling Time Improvements Pad drilling/Pad layout Bits/Muds/Motors Well design: monobores/ orientation/ reservoir placement Toe up/Toe down: effects on production Natural gas fueled rigs 17
Kaybob Plant Capacity Gross Net POU Raw Raw Est. Net Gas Capacity Sales Current Capacity MMcf/d MMcf/d Boe/d Musreau 45 45 8,600 Resthaven Plant 20 10 2,000 Smoky Plant 100 10 2,500 Kakwa Plant 40 4 720 Pembina Musreau…
More NGLs - Why Now Historically, producers extracted only enough liquids to meet hydrocarbon dewpoint for sales gas pipeline specifications Value gas with higher natural gas liquids (NGL's) were sold as a higher heat content (more…
What is Deep-Cut Deep-Cut simply refers to capturing a higher amount of natural gas liquids present in certain high-heat content (rich) natural gas streams Liquids are generally captured by cooling the natural gas stream…
Process Flow Chart: Musreau Deep Cut Facility *Based on indicative prices and differentials which are subject to change 22
Deep-Cut 3.00/Mcf, 100/Bbl Mix of Cretaceous and Montney Montney Wells Only Example Wells Example 200 MMcf/d x 15% Shrinkage = 170 200 MMcf/d x 23% Shrinkage = 154 Price MMcf/d (28,333 Boe/d) Sales Gas MMcf/d (25,667 Boe/d) Sales…
Paramount Deep-Cut Montney Project Economics Resource Needed: 200 MMcf/d x 365 73 Bcf/year x 10 year RLI = 730 Bcf 70 Bcf/section 50 % recovery = 20 Sections Cost 40 (5 MMcf/d wells) x 10 MM/well = 400 MM Gas Plant = 200 MM Total:…
Karr-Gold Creek Located 50 km SW of Grande Prairie Multi-zone potential, including Halfway, Montney sour and Nikanassin, Gething, Bluesky and Falher sweet commingled gas Current lands 95,000 net acres (148 sections) Average 83%…
Valhalla Montney/Doig Play Eight wells tied in at restricted rates (facility constraints) Four wells awaiting completion Two wells awaiting tie-in Gathering system expansion and additional compression completed Q1 2012 Continued…
Birch Acquired as part of the Prospex acquisition Completed Hz Montney well with promising results; significant liquids ratio on test Production processed through pilot facility limited to 3 MMcf/d Drilled and completed two…
Paramount Investments
Paramount Investments 19.1 MM shares of Trilogy 27.00/share 515 MM 43.8 MM MGM Energy Corp. shares 10 MM 0.23/share Paramount Drilling U.S./Fox Drilling Inc. 85 MM 3.7 MM shares of MEG Energy 37.00/share 140 MM Other (Paxton,…
Cavalier Energy Inc.
Created in December 2011 Experienced team led by CEO Dr. Will Roach (ex UTS) Paramount has contributed all of its oilsands assets to Cavalier Energy and seed capital Funding at the Cavalier level will be via a combination of…
Cavalier Assets Approximately 311 sections Prospective primarily for conventional oilsands, bitumen in carbonates, and cold flow heavy oil All but 4 sections 100% WI 32
Hoole Grand Rapids - 1st Project Grand Rapids Reservoir = 30 %, k = 1 to 4 D d = 250m, h 20m, p = 1500 kPa Viscosity = 200,000 to 2,000,000 cp McDaniel Best Estimate : OBIP= 1.6 Billion Bbl 75 wells drilled to date; 39 cored 763…
Liard Basin Paramount holds 127,000 net acres prospective for shale gas 200-500+* Bcf/section 20% recovery POU 15 Tcf sales gas* *Internal estimates 34
Liard Basin Cross Section Besa River Shale Gas 35
Quarterly Operating Results Production Operating Costs Boe/d /Boe Q2 2012 Production Maintaining cost guidance represents controls with a 23% growth over increasing production 2011 volumes is driving per Boe operating costs…
Summary Exposure to significant reserve opportunities Kaybob Deep Basin: Cretaceous, Montney Karr: Montney, Nikanassin Valhalla: Montney, Doig Birch: Montney Significant asset value Trilogy MGM MEG Energy Cavalier Energy Horn…
ADVISORIES APPENDIX
4700 Bankers Hall West 888 Third Street S.W. Calgary, Alberta Canada T2P 5C5 Telephone: (403) 290-3600 Facsimile: (403) 262-7994 www.paramountres.com
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