WHY PIVOTAL We needed to demonstrate: Performance as a Lean, Mean Montney Machine Industry Leading Low Cost Structure Improved Well Performance & Capital Efficiencies Continued Execution Capability & Delivering Targets…
WE ACHIEVED 2014 GOALS & MORE Production Op. Costs Cash Costs Reserve Adds Debt/Cash Flow Capital Spending Well Results HSE 4
SUCCESSFULLY REPLACED CONVENTIONAL PRODUCTION THROUGH GLACIER MONTNEY GROWTH 40,000 Higher cost Non-Glacier 2014 First Year as Pure Montney Producer. 35,000 production divested 2009-2013 Future Plan growth targeted to exceed…
WITH AN INDUSTRY LEADING LOW COST STRUCTURE 6.00 5.00 TOAL CASH COSTS /mcfe Reduced Total Cash Costs due to: 4.00 Divestment of conventional assets Streamlined to focus only on Montney 3.00 2.00 0.84/mcfe 1.00…
POSITIONING ADVANTAGE AS THE LOWEST COST PRODUCER A 1 Cdn realized gas price will more than cover Advantages production costs, royalties, G&A & interest of 0.89/mcfe 7
WITH STRONG MARGINS ONE OF THE HIGHEST CASH NETBACK MARGINS IN SECTOR Royalties 4% Cash Flow Net Back 74% Operating Costs 11% G&A 5% Interest & Other 6% BASED ON Q1 2015 RESULTS 8
OUR DRILLING, COMPLETIONS & TECHNICAL EXPERTISE LED TO 10
WELL OUTPERFORMANCE IN THE UPPER AND LOWER MONTNEY Recent wells completed with slick water and more frac stages are outperforming our Budget/Plan type curve assumptions - - - Budget Type Curve (IP30 6.9 mmcf/d & 6.9 Bcf)…
AND IN OUR LIQUIDS RICH MIDDLE MONTNEY WELLS New 2013 12-2 well started Middle Montney wells have sequentially production at restricted rate of 9.5 demonstrated improved productivity as mmcf/d. Currently producing at we optimize frac…
CREATED A CURRENT INVENTORY OF WELLS NONE Required for Production 33 Wells drilled in 2014 program Until July 2015 22 Wells currently completed and tested (production ready) 6 Wells initially required to ramp to 183 mmcfe/d July…
Improving Glacier Well Economics 30% ROR 2.50/mcf 70% ROR 3.50/mcf
2014 RESULTS LED TO 150 MILLION LOWER DEVELOPMENT PLAN CAPITAL WITH UNCHANGED GROWTH TARGETS (1) Production Profile 245 mmcfe/d 205 mmcfe/d 183 mmcfe/d Current production 130 to 135 mmcfe/d 2015 2016 2017 (2) Production…
MAINTAINING BALANCE SHEET STRENGTH & SUSTAINABILITY (1) Total Debt to Trailing Cash Flow Sensitivity 2.1 2.1 1.9 1.9 1.8 1.8 1.5 1.2 0.8 2015 2016 2017 AECO 3.50/GJ AECO 3.00/GJ AECO 2.50/GJ (1) Based on production growth &…
STRONG CASH FLOW PER SHARE GROWTH 2017 (1) 1.40/share (1) 2016 1.10/share (1) 2015 0.79/share (1) Based on production growth & Plan details shown in May 2015 Investor presentation Appendix page 24. 17 Aeco Cdn prices…
AND GENERATING SURPLUS CASH FLOW IN 2017 Estimated Annual Surplus Cash Flow at 245 mmcfe/d: 90 million3.00/GJ 135 million3.50/GJ (1) Based on Plan details in May 2015 Investor presentation Appendix pg 24 18
ONLY Plan Requires 70New wells By 2017 thats just the tip of OUR 1,000 well GLACIER Drill Inventory
WITH ADDITIONAL 100% OWNED MONTNEY LANDS TO DEVELOP IN FUTURE R14 R13 R12 R11 R10 R9 R8 R7W6 T78 T78 T77 PROGRESS T77 Future GLACIER Developing T76 VALHALLA T75 Evaluating T74 Additional 56.25 net sections of…
SUPPORTED BY 100% OWNED PLANT + PIPELINE INFRASTRUCTURE R14 R13 R12 R11 R10 R9 R8 R7W6 78 T78 77 T77 Preserves our Glacier Gas Plant T76 LOW COST T75 STRUCTURE T74 and allows T73 CONTROL OF OUR DESTINY Company Land…
Downside Price Protection & Financial Flexibility (1) HEDGING CREDIT FACILITY 2015 57% 3.86 189 million of 2016 46% 3.69 450 million 2017 Q1 42% 3.65 CURRENTLY AVAILABLE (1) AECO Cdn /Mcf 22
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