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FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd.

Long Run Exploration Ltd. · Feb 11, 2013 · 28 slides

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Slides

  1. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 1
    HERE FOR THE LONG RUN CORPORATE PRESENTATION, FEBRUARY 2013 TSX: LRE
  2. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 2
    LONG RUN PROFILE Key Metrics Listing TSX:LRE Shares Outstanding 126 million Production 23,000 boe/d Oil + NGLs 11.5 mbbl/d Gas 69 MMcf/d Oil Weighting 50% Average Oil Gravity 32 API Anticipated 2012 Year-end Net Debt 290 million…
  3. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 3
    PRODUCTION VERSUS PEERS Long Run is Liquids Rich Total Production (boe/d)* Liquids Production (bbls/d)* 30,000 16,000 14,000 25,000 12,000 20,000 10,000 15,000 8,000 6,000 10,000 4,000 5,000 2,000 0 0 CR LRE BIR…
  4. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 4
    FINANCIAL METRICS VERSUS PEERS Reduced Debt-Leverage 2013e Debt/Funds Flow* 4.5 180 million asset sale closed December 4.0 14, 2012 3.5 3.0 Expected net debt to 2013 expected 2.5 funds flow of 1.3x is among peer group 2.0…
  5. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 5
    THE OPPORTUNITY Room to Run Focus on the Western Canadian Sedimentary Basin, specifically on areas that provide tight oil and gas potential, ability to control infrastructure and room for expansion and consolidation Build a…
  6. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 6
    HEDGED VOLUMES Protecting the Balance Sheet Volume Contract Price per GJ Term 5,000 GJ/d Fixed 4.20 Jan. 1/13 - Oct. 31/13 10,000 GJ/d Fixed 4.05 Apr. 1/13 - Dec. 31/13 2013 Gas 61% 20,000 GJ/d Fixed 3.43 Jan. 1/13 - Dec. 31/13…
  7. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 7
    2013 CAPITAL BUDGET Targeting Growth Drill, Complete and Tie-In Capital (%) Wells Peace River Montney Oil 110 mm (42) 50 Redwater Viking Oil 82 mm (31) 68 Other Oil 25 mm (9) 12 Other Gas 3 mm (1) 2 Total DC+Tie-In 220 mm 132…
  8. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 8
    2013 OPERATING BUDGET Targeting Growth Forecast Average Daily Production Anticipated 2013 Cost Structure Natural Gas 70 MMcf/d /BOE Heavy Oil 1,300 bbl/d Royalties (6.50) Light Oil 11,000 bbl/d Operating Expenses (12.75) NGLs 1,110…
  9. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 9
    KEY PROPERTIES Exploration and Development Focused Northern Gas Peace River Exploration Edmonton Area LONG RUN EXPLORATION CORPORATE PRESENTATION FEBRUARY 2013 8
  10. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 10
    NETBACKS BY PRODUCT Montney Oil Viking Oil Northern Gas Area Heavy Oil (Peace River) (Redwater) (Boyer) Production 4,650 bbl/d 4,000 bbl/d 1,050 BOE/d 18 MMcf/d Oil Quality 28 API 38 API 11 API N/A Benchmark 95.00 (WTI) 95.00…
  11. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 11
    PEACE RIVER Dominant Position in Multi-Zone Play 600,000 net acres Primary targets are Triassic age resource plays targeting oil and liquids-rich gas Worsley Current development focus area is Girouxville/ Normandville…
  12. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 12
    MONTNEY The Big Picture Alberta British Columbia 1 - Shoreface Very fine sandstone / Shale Oil w/ associated gas 950 1,050 m TVD 1,000 m 5-15m net pay 5-20 md permeability 13-15% porosity 25-30 API 2,000 m depth 2 -…
  13. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 13
    MONTNEY Long Run Offers the 5th Largest Land Position in the Montney Montney Land Holders (Net Sections) 1,400 1,200 1,000 800 600 400 200 0 LONG RUN EXPLORATION CORPORATE PRESENTATION FEBRUARY 2013 12…
  14. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 14
    MONTNEY Oil Upside in the Peace River Arch Girouxville/Normandville area Current production approximately 6,600 BOE/d (70% oil) Drilled 47 wells from August 2011 to year end 2012 Waterflood upside potential Estimated average…
  15. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 15
    MONTNEY PHASE I String of Pearls Normandville Montney E Montney Porosity Subcrop 5 sections Normandville NE Normandville Montney Montney 15 sections 16 sections Peace River Arch Girouxville Girouxville South Montney…
  16. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 16
    MONTNEY EXISTING FACILITIES Substantial Throughput Capacity Normandville Oil Battery 5,000 bopd 15 MMcf/d Donnelly Gas Plant 28 MMcf/d to sales Girouxville Oil Battery 5,000 bopd 12 MMcf/d Facility Faults…
  17. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 17
    MONTNEY WELL Typical Design True vertical depth 1,000 m Horizontal lateral length 1,200 m Average drilling time 9 days Drill cost 900K Frac size per stage 3-5 tonnes Frac costs 900K Equip & tie in 250K LONG RUN…
  18. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 18
    MONTNEY Type Curve Economics Montney Horizontal Oil Type Curve 250 IP 90 150 boe/d 44 Wells 2012 Montney Hz Oil Type Curve NPV BT 8% 2.5 million 200 All Montney Hz Greater or equal to 20 Stages On-stream cost 2 million 150…
  19. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 19
    EDMONTON CORE AREA Cherhill & Redwater Cherhill & Redwater produce a combined 5,500 boe/d (82% oil) Primary targets are Viking / Mannville and Mississippian oil horizons Significant infrastructure in-place Edmonton Land…
  20. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 20
    VIKING - REDWATER Significant Development Inventory Current production approximately 4,000 boe/d (89% oil) Viking oil horizontal multifrac/multilateral play 38 API oil 40,000 net acres (62 sections) of horizontally…
  21. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 21
    REDWATER FACILITIES Redwater North Compressor Station 2-2.5 MMcf/d Bruderheim North Redwater North Oil Battery Oil Battery 2,000 bopd 3,000 bopd 500 Mcf/d 2.0 MMcf/d Edmonton Bruderheim South Oil Battery 1,200 bopd…
  22. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 22
    REDWATER WELL Typical Design True vertical depth 700m Horizontal lateral length 800m Average drilling time 4 days Drill cost 400K Frac size per stage 7 tonnes Frac costs 600K Equip & tie in 200K 25 Stage Frac (35m…
  23. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 23
    REDWATER Type Curve Economics Alberta Viking Well IP 90 50 boe/d 70 NPV BT 8% 1.0 million 105 Wells 60 On-stream cost 1.2 million Production (boe/d) 50 Payout 18 months 40 30 48 Wells Recycle ratio (12 month) 2.1x 20…
  24. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 24
    BOYER Natural Gas Torque Acquisition in February 2012 Producing approximately 19 MMcf/d Shallow decline gas (8%/year) 710,000 net acres Low operating costs of 1.29/Mcf Current drilling density less than 1.5 wells per…
  25. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 25
    PEACE RIVER ARCH EXPLORATION Jack Q3 Flood Q1 HZ Charlie Lake Oil VT Test Montney Oil Josephine Q1 HZ Charlie Lake Oil Eaglesham Q1 Girouxville Q3 HZ Montney Gas/Oil HZ Slave Point/Wabn Oil Puskwaskau Q1 VT Test…
  26. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 26
    DUVERNAY The Duvernay shales are analogous to shale plays such as the Barnett and Haynesville in the U.S. Long Run Duvernay Initial vertical test well cored, cased Current Well Location 9-6-76-23W5 fractured and flowed on…
  27. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 27
    WHY LONG RUN EXPLORATION Reasons to Invest Increasing netback through light-oil development focus Strong and proven management team Financial strength to provide exploration capital in opportunity rich Peace River Arch area…
  28. FEBRUARY 2013 CORPORATE PRESENTATION – Long Run Exploration Ltd. – slide 28
    CORPORATE INFORMATION TSX :LRE Contacts Bill Andrew Chair and CEO (403) 261-6012 Dale Miller President (403) 261-6012 Jason Fleury Vice President, Capital Markets (403) 261-8302 Main: 403-261-6012 Toll-Free Investor Line:…

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