Value Proposition Risk Managed Value Creation Long-term view with a commitment to value creation through profitable growth and income Focus on cost management and capital discipline Significant exposure to early stage development of…
Unique Strategy Risk Managed Value Creation is Central to ARCs Strategy Targeting net debt to 200% Reserve funds from operations Replacement through the between 1.0 1.5x drill bit for the past 6 consecutive years One of the…
ARCs Proven Development Model Inventory of Opportunities at all Stages FULL CYCLE GROWTH AND INCOME PROVIDER Dawson, Pembina, SE Sask/Manitoba, Redwater OPTIMIZE COMMERCIALITY Ante Creek, Parkland/Tower EXPANSION REPEAT…
High Quality Long Life Assets
Montney Growth Assets 3rd Largest Montney Landholder with 950 Net Sections in BC and Alberta 500 km
Why the Montney Recoverable Resource exceeds equivalent of 3 Haynesville Shales or 6 Barnett Shales Massive thickness Superior Lithology and Fracability High permeability Higher recovery factors Reservoir Attribute Montney…
ARC in the Montney Montney ARCs Growth Engine 100,000 2014 2014 Sunrise Parkland Gas Development 90,000 Plant: Phase 1 2013 80,000 Construction begins Montney Liquids 2011 on Parkland Phase 1 70,000 Dawson Gas Montney Gas…
NEBC Montney Reserves & Resources NEBC Montney TPIIP 55 Tcf of Gas and 2.2 Billion Barrels of Oil Corporate 2P Reserves of 634 mmboe OIL RESERVES 11.3 mmbbls 2.2 Tcf NGL 27.6 mmbbls OIL ECONOMIC CONTINGENT RESOURCE 10.7 mmbbls…
Montney - Multiple Layers to Develop Attachie Septimus Sunrise Tower Parkland Dawson Pouce Coupe Montney A Upper Montney Montney B Montney C Montney Lower Montney D Montney E - Existing Horizontal…
Dawson Gas World Class Gas Resource
Dawson Asset Details Excellent Free Cash Flow Net production (boe/d) Q2 2014 27,700 Liquids (bbls/d) 970 Gas (mmcf/d) 160 Production split % (liquids/gas) 97% gas Land (Montney net sections) 133 Working Interest 96%…
Dawson A Cash Flow Machine Low Reinvestment Ratio to Maintain Significant Free Cash Flow Grown production from approximately 50 Mmcfe/d in 2009 to 165 Mmcfe/d by mid 2012 At Cdn3 gas 30% Reinvestment Ratio to sustain Cash Flow and…
Dawson Gas Type Curve Growth Frac Technology Advancements = Improvements in Well Performance Completions 2009-2011 2012 2014 Type curve growth over time due to Frac spacing (m) 180 150 85 improvements in well design, focused on…
Parkland/Tower Reaping Acquisition Benefits
Parkland/Tower Asset Details Material Value Creation in 2014 Parkland Tower Net production (boe/d) 16,100 4,450 Q2 2014 Liquids (bbls/d) 3,500 2,810 Gas (mmcf/d) 76 9.8 Land (net sections) 23 57 Working Interest 84% 92%…
Tower Dual-Layer Development Tower also has Dual-Layer Montney Development Opportunity Parkland and Tower have similar geology Tower Type Well Parkland Type Well Montney A Upper Montney B Montney Montney C Montney…
Operational Excellence - Tower Optimal Frac Design and Significant Efficiency Gains in Tight Oil Play 60% Decrease in Cost/Frac, 2X Increase in Applying Learnings in Well Length and Frac Intensity 2,500 Frac Spacing 90 160,000 60…
Tower Strong Well Performance Early Days.Promising Results at Tower Tower 12-16 Pad (8 wells) Cumulative Production Cumulative Oil Production (Mbbls) Cumulative Total Production (Mboe) Restricted to 100 bopd MRL due to…
Sunrise Long-Term Growth Opportunity
Sunrise/Sunset Asset Details Sunrise/Sunset Ready Moving Forward with Full Scale Development Sunrise has progressed from pilot to full scale development Net production (boe/d) Q2 2014 5,100 Liquids (bbls/d) 0 Gas (mmcf/d) 30.6…
Sunrise Development Planning Multiple Zones with Economies of Scale Sunrise Development Sunrise Type Well Proposal Montney A Montney B Montney C Montney D Montney Existing E Horizontal Wells
Sunrise Outperforming Expectations 2014 Drilling Results Prove up Four Layer Development Model 10,000 2013/2014 Type Curve (11 Bcf) 9,000 Montney A 08-24Hz (MTYA) 8,000 Montney A (Lower) C09-13Hz (Lower MTYA) 7,000 Montney…
Sunrise Outperforming Expectations Type Curve Improvements over time due to improvements in well design Completions 2009-2011 2014 7,000 Frac spacing (m) 120 80 Fracs per well 16 25 6,000 2013/2014 Type Curve (11 Bcf) Cost per…
Risk Managed Value Creation
Montney Development Economics Strong Rates of Return Across the Montney Portfolio Half Cycle Economics Cdn 95/bbl Oil and Cdn4/GJ Gas Parkland Tower Dawson Sunrise Ante Creek 70% IRR 35% IRR 85% IRR 80% IRR 70% IRR 4.2x Recycle…
Montney Pilots Proving Up Future Value before Full Scale Development West Attachie: Pilot Production on-stream since Q2 Parkland: 2014 Lower Montney well on-stream Q3 2014 East Attachie: Pouce Coupe: Monitoring Pilot Lower…
Summary
Why Invest in ARC Clear Line of Sight to Long-term Value Creation Long-term view and commitment to value creation through profitable growth and income Focus on cost management and capital discipline Significant exposure to early…
Looking Beyond 2015 Diverse Portfolio Provides Strategic Optionality Well balanced inventory of value creating opportunities which may be pursued beyond 2015 Option to grow at a rate estimated to be similar to growth for the period…
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