Bank of America Merrill Lynch June 2014 Global Energy & Power Leveraged Finance Conference
OUR FOCUS We are an upstream energy company, focused on light oil development in western Canada EXTENSIVE PORTFOLIO SUSTAINABLE SHAREHOLDER VALUE OF ASSETS BUSINESS MODEL CREATION Drilling inventory of 10+ 2014 growth platform…
OUR ASSET BASE Oil Gas Business Units Q1 Production Drilling Inventory Q1 Average Production (boepd) (locations) 43,959 boepd Southeast Saskatchewan 20,742 1,170 Drilling Inventory Cardium 18,893 530 2,000 locations AB / BC…
CONSISTENTLY DELIVERING RESULTS Our assets have built a reliable foundation providing consistent results year-over-year Average Production (boepd) Operating Netback (/boe) 46,438 42,784 44,000 54.76 41,688 40,998 50.00 47.76…
ASSET BASE Our portfolio has grown to include significant holdings in 4 major light oil plays, a strong reserve base and a large undeveloped land inventory, positioning us for long-term growth 3 Year Reserve Results Proved + Probable…
GROWING FREE CASH FLOW Initial capital investment in light oil resource plays generates near-term FUTURE GROWTH production growth and early payout GROWING INTO Maturing production base FREE CASH FLOW generates growing free cash…
DEBT AND LIQUIDITY Term debt provides certainty; liquidity on the balance sheet provides flexibility 2 365 million of available liquidity DEBT CAPITAL COMPOSITION Term Secured Debt Term subject to 1.3 billion Credit…
TOTAL DEBT POSITION Total Year-End Debt 2010 2011 2012Q1 2013 2014 Pro Forma 2015 2,500 50,000 2015 Target (post dispositions) 2,000 40,000 Debt and Liquidity (million) Production (boepd) 1,500 30,000 1,000 20,000…
DISPOSITION ACTIVITY Year to-date we have announced asset sales totaling 351 million, including the recent 98 million non-core southeast Saskatchewan sale to be closed in July 2014 Amount Metric 3,015 boepd Production 116,418/boepd…
2014 GUIDANCE AND CAPITAL PROGRAM 2014 Guidance 2014 Capital Program Average Production (boepd) (1) 43,000 45,000 Exit Production (boepd) 45,000 47,000 Cardium BU Liquids Weighting 80% 237 MM 42 Wells Funds Flow from Operations…
WE HEDGE OUR RISK We methodically layer on commodity contracts up to three years in the future to hedge between 25-50% of net production Hedging Outlook 2014(e) Production 44,000 boepd 20,000 125 16,000 100 Royalties Hedged…
MATURING ASSET BASE As our production matures, our base decline is decreasing Annual Corporate Decline Rate 50% 40% 30% 20% 10% 0% 2010 2011 2012 2013 2014(e) 2015(e) 13
PRODUCTION PLATFORM In 2014, with lower base declines, we can maintain our production platform with reduced capital investment 50,000 1,000 Extensive light oil assets 80% light oil and liquids 40,000 800 Capital Expenditures…
IMPROVING SUSTAINABILITY Our sustainability ratio continues to improve as our production matures All-in Sustainability 200% 190% Maturing production 161% 150% attenuates the base decline 150% 134% rate and generates higher free…
SE SASKATCHEWAN ASSETS We are maximizing the value of our assets by focusing on optimization and EOR Our assets have lower decline, light oil production from the Bakken and the conventional Mississippian formations. With a moderate…
IMPROVING TIGHT OIL RECOVERIES Future value generation through natural gas flooding With Bakken EOR projects we Bakken Creelman EOR Performance expect to: 1,600 12 Attenuate declines and 1,400 extend production life Increase…
CARDIUM ASSETS Now generating positive operating cash flow Our extensive land base stretches from Calgary to LTS Land Edmonton and our assets primarily produce light oil LTS Batteries from the Cardium formation. We are evolving our…
CARDIUM GROWTH We grew the production in the Cardium quickly and it has been maintained at 20,000 boepd for more than a year 25,000 500 20,000 400 Net Wells on Production Production (boepd) 15,000 300 10,000 200…
PROVEN RESULTS THROUGH INNOVATION Innovations in drilling and completion techniques improve productivity and lower costs Performance in West Pembina Slickwater fracturing has 80,000 reduced costs and improved productivity…
AB / BC ASSETS The Swan Hills has become our next growth target Our focus for new growth is in the Swan Hills area of northern Alberta. We started drilling in the area in 2012, and have since grown production rates to 2,700 boepd (2013…
GROWING SWAN HILLS PRODUCTION In 2014 we have drilled 7 new wells which recently have been brought on production as our new 3,500 bopd battery was commissioned 5,000 25 4,000 20 Net Wells on Production Production (boepd)…
OUTPERFORMING EXPECTATIONS Our 100% operated wells are outperforming our original projections Swan Hills Area Performance (1 Mile Lateral Wells) After the first year, our 120,000 initial 6 Deer Mountain Cumulative Oil Production…
WELL ECONOMICS We focus on well economics that reinforce our business model with quick payouts and strong capital efficiencies < 2 year capital payout 2 recycle ratio Mississippian Type Well Bakken Cardium Swan Hills1 Conventional…
LONG-TERM OPPORTUNITY EXTENSIVE ASSETS SUSTAINABILITY SHAREHOLDER VALUE Inventory of 10+ years 2014 sustainability ratio Strong cash netbacks of 100% Undeveloped land of Improving debt to cash 750,000 acres Attractive annual…
Appendix
OPERATING NETBACK Our assets combined with our operational expertise deliver leading operating netbacks Q1 Operating Netbacks 70 60 50 /boe 40 30 20 10 0 VET LTS BNE TOG CPG WCP SGY PWT ARX BTE ERF PGF BNP PEY…
CASH NETBACK Our strong cash netbacks are the result of our light oil focus Q1 Cash Netback 50 40 /boe 30 20 10 0 BNE TOG CPG VET LTS WCP SGY BTE ARX PWT BNP ERF PEY PGF Cash netback = funds flow from operations…
DIVIDEND PAYOUT RATIO Lightstream maintains the lowest dividend payout ratio in our peer group at 15% Q1 Dividend Payout Ratio 60% 50% 40% % of Cash Flow 30% 20% 10% 0% LTS BNP PEY PWT ERF TOG VET ARX WCP PGF SGY…
CASH NETBACK AFTER DIVIDENDS Our low dividend payout ratio and high cash netbacks generate significant discretionary cash Q1 Cash Netbacks After Declared Dividends 40 30 /boe 20 10 0 LTS TOG VET WCP BNE CPG SGY PWT…
SUSTAINABILITY We are targeting a sustainability ratio of 100% for 2014 2014(e) Consensus All-in Sustainability 188% 150% 125% 100% 75% 50% 25% 0% WCP SGY TOG LTS VET BNE PWT ERF PEY BTE BNP ARX CPG PGF Peer group data…
Loading...
