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FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc

Surge Energy Inc · Mar 8, 2012 · 43 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. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 1
    Continuing to Deliver Top Tier Oil Growth March 2012 TSX:SGY
  2. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 2
    Surge Energy Corporate Profile TSX: SGY Listing 700 million Market Capitalization(1) 490 gross (350 net) Oil Drilling Inventory 500,000 acres Net Undeveloped Land 71/78 million(2) Basic/Fully Diluted Shares O/S 4%/9%…
  3. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 3
    Surge Evolution: March 2011-2012 One Year Ago: Today: (1) (2) Exit Production Estimates: 4,500 boe/d (60% Oil & NGLs) 9,000 boe/d (71% oil & NGLs) 2P Reserves (mmboe): 21.2 (58% oil & NGLs) (3) 36.7 mmboe (65% oil and NGLs)…
  4. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 4
    (1) 2012 Guidance Production: Exit 2012 Production: 11,000 boe/d (77% oil and NGLs) Average 2012 Production: 9,750 boe/d (74% oil and NGLs) Capital Spending: Capital Expenditure: 261 MM (155 MM net of acquisitions) Planned 2012…
  5. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 5
    Surge Energy Inc. Business Plan Evolve into a Top Tier Intermediate Light Oil Producer Acquire & Develop Underexploited Oil Resource Plays Optimize Identify & Oil Capture New Oil Recovery Resource Plays including…
  6. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 6
    Proactive & Deliberate Approach to Making Acquisitions Low Recovery Factor to Date Big Oil Well Control In Place ABILITY TO DOUBLE THE VALUE 7
  7. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 7
    Overview 3. Longer Term Growth Initiatives 2. Current Growth Initiatives 1. Value Creation to Date 8
  8. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 8
    Value Creation to Date 9
  9. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 9
    Compound Annual Growth Rate of 138% from April 2010 to January 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…
  10. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 10
    Production Growth per Share 12,000 160 /d)/MM shares basic and fully diluted 10,000 140 137 Average Production ((boe/d) 8,000 125 120 6,000 103 Production (boe/d)/MM 101 9,750 100 4,000 83 5,960 80 2,000 82…
  11. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 11
    Reserves Growth per Share 40 600 35 511 500 )/M shares basic and fully diluted 30 460 378 400 MMboe) 2P Reserves (MMboe 25 349 20 300 15 32.2 200 2P (boe)/M 10 21.2 100 5 0 0 2010 2011 2P…
  12. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 12
    Cash Flow Growth per Share 200 2.00 1.87 180 1.80 Cash Flow per share basic and fully diluted 160 1.70 1.60 140 1.40 Cash Flow (MM) 120 1.20 100 0.98 1.00 80 0.96 133 0.80 60 0.60 40 0.44 0.44 57 20 0.40…
  13. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 13
    Leading Capital Efficiencies Among Oil Weighted Peers /boe Recycle Ratio(1) F&D Including in FDC 14.02 2.7 FD&A Including in FDC 16.65 2.3 Increased 2P reserves by 52 percent Increased 2P reserves per FD Share by 32 percent…
  14. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 14
    Proforma Net Asset Value (NAV) as at December 31, 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)…
  15. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 15
    Current Growth Initiatives 16
  16. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 16
    Core Operating Areas Western Alberta South East Alberta Williston Basin Percent of Reserves: 70% 20% 10% Percent of 2012 Capex: 51% 18% 31% Net Undeveloped Land: 260,000 acres 138,000 acres 98,000 acres Remaining Oil Drilling…
  17. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 17
    Western Alberta Key Properties Nipisi Valhalla South Grande Prairie (Service Hub) Goose River Windfall Whitecourt 30 miles (Service Hub) Surge Core Properties Core Properties in Close Proximity to Two Major Oil Field…
  18. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 18
    Western Alberta Valhalla South (Doig) Highlights: Rates of return 175% (1) 115 mmbbls gross (99 mmbbls net) DPIIP (40 degree API light oil) Current oil…
  19. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 19
    Western Alberta - Nipisi/Gift (Slave Point/Gilwood) Highlights: Analogue Slave Point Waterflood 1,200 bbls/d (100% Light Oil) current production from Slave Point/Gilwood Formations Gift (1) Nipisi 65 mmbbls gross (56 mmbbls…
  20. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 20
    Western Alberta Windfall (Bluesky) Highlights: Waterflood pilot program application approved with first injection planned for Q2 2012 (1) 60 mmbbls gross (57 mmbbls net) DPIIP (36 degree API light oil) Current oil…
  21. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 21
    South East Alberta (Cretaceous Sands) Highlights: Low-decline, high ROR assets that provides reliable base cash flow (32MM/year) Leela Multi-zone oil potential at shallow depths Silver Forecast 50% production growth in 2012…
  22. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 22
    Williston Basin Manitoba/North Dakota (Spearfish) Pierson Recent Surge Drilling Activity Highlights: Waskada 100% light oil property (1) 202 mmbbls gross (150 mmbbls net) DPIIP CANADA Goodlands (36 degree API) USA Current oil…
  23. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 23
    Summary of Unbooked Light Oil Drilling Locations Net Estimated Estimated Unbooked Rates of NPV10 BT Per FD Capital / Unbooked NPV10 BT/ Reserves / Oil Hz Return Additions(2)(3) Share(4) Well Adds Well(2) Well Wells(1) % MM /share…
  24. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 24
    Longer Term Growth Initiatives Oil Resource Play Exploration Tight Oil Waterfloods 25
  25. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 25
    Exploration Initiative: Goose River Highlights: Beaverhill Lake Oil Pool: 230 mmbbls OOIP Early entry has allowed Surge to cost effectively capture more than 131 gross/net sections of land in the Goose River area In the early…
  26. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 26
    Waterflood Portfolio Exposure to 360 mmbbls of DPIIP…
  27. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 27
    Unbooked Waterflood Upside 30 mmbbls Recovery Potential from Tight Oil Waterfloods. Net DPIIP Cumulative Oil Recovered Primary Recovery Incremental Secondary Area Formation (mmbbls) To Date (%) (mmbbls/%) Recovery (mmbbls/%)(1)…
  28. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 28
    Potential to More Than Triple Company Oil Reserves 23 mmbbls Current 2P Oil & NGLs Reserves(1) 25 mmbbls Unbooked Light Oil from Drilling Inventory 31 mmbbls Unbooked Light Oil from Tight Oil Waterfloods MM(2) /FD Share Net Asset…
  29. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 29
    Surge Energy - Continuing to Deliver Top Tier Oil Growth Leading capital efficiencies among oil weighted peer group 2011 2P F&D of 14.02 per boe (incl. change in FDC), recycle ratio of 2.7 Proven growth focused management team 3…
  30. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 30
    Appendix 31
  31. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 31
    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…
  32. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 32
    Surge Energy Inc. Summary of Recent News Releases March 1, 2012 Significant increase in its 2011 year-end reserves and operational update. January 6, 2012 - Exceeded 2011 upwardly revised exit production rate estimate , closed the…
  33. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 33
    Valhalla South Doig Type Curve and Key Metrics 700 (1) Key Metrics: 620 boe/d 600 1st Month Average IP: (75% oil and NGLs) 670 mboe 500 Reserves/Well: (56% oil & NGLs) Production Rate (boe/d) NPV/Well : 11.2 million 400…
  34. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 34
    Windfall Bluesky Type Curve and Key Metrics 200 (1) Key Metrics: 180 185 boe/d 1st Month Average IP: 160 (65% oil and NGLs) 250 mboe Reserves/Well: 140 (54% oil & NGLs) Production Rate (boe/d) NPV/Well : 3.0 million…
  35. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 35
    Waskada Spearfish Type Curve and Key Metrics 160 (1) Key Metrics: 140 145 bbls/d 1st Month Average IP: (100% oil) 120 70 mbbls Reserves/Well: (100% oil) Production Rate ((bopd) 100 NPV/Well : 1.7 million Profit/…
  36. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 36
    North Dakota Spearfish Type Curve and Key Metrics 140 (1) Key Metrics: 125 bbls/d 120 1st Month Average IP: (100% oil) 60 mbbls Reserves/Well: 100 (100% oil) NPV/Well : 0.8 million bopd) Production Rate (bopd 80 Profit/…
  37. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 37
    Detailed Economics of Key Light Oil Resource Plays Economic Inputs/Outputs: Valhalla South Windfall SW Manitoba North Dakota (Doig) (1) (2) (Bluesky) (1) (2) (Spearfish) (1) (Spearfish) (1) Drill 2.80 MM 2.0 MM 600,000 700,000…
  38. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 38
    Surges Oil Hedge Summary *Surge 2012 Oil Hedges: 66% participation with an average floor price of 89.48 Oil Hedging Swap/Price Floor Period Volume in bbls/day Call Option (Cdn/bbl) Index (Cdn/bbl) 2012 Oil Hedges Jan. 1 to Dec.…
  39. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 39
    Average Hedge Price Received by Surge on Hedged Barrels 180 Weighted average price per boe received by Surge 160 140 120 100 80 60 Hedging Gains 40 20 0 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80…
  40. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 40
    Hz Multi-frac Wells: The Tight Oil Waterflood Enabler Tight Oil Vertical Well Line Drive Pattern Tight Oil Horizontal Well Line Drive Pattern - water injector - water injector - oil producer - oil producer 200 meter well…
  41. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 41
    Windfall (Bluesky) Full Field Development Scenario 8,000 *Total Waterflood Development: 7,000 46 Producers 46 Injectors 6,000 8 mmbbls Incremental Oil Reserves 5,000 BOE/day 4,000 3,000 2,000 Capital spending can be…
  42. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 42
    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…
  43. FIRSTENERGY SOCIETE GENERALE EAST COAST ENERGY CONFERENCE – Surge Energy Inc – slide 43
    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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