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July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL)

Canadian Natural Resources Limited (CNRL) · Jul 3, 2015 · 45 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. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 1
    CORPORATE PRESENTATION July 2015
  2. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 2
    Delivering Value and Growth SNAPSHOT 2014 2015F Cash flow(1) (C$ million) $9,587 $6,400 - 6,800 Per share ? basic(1) (C$) $8.87 $5.80 - 6.20 Capital expenditures (C$ million) $11,744 $5,745 Dividend (C$/Share) $0.90 Common shares…
  3. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 3
    CNQ PREMIUM VALUE. DEFINED GROWTH. INDEPENDENT. Slide 2 Canadian Natural 5 Key Messages Safe, effective, efficient & environmentally responsible operations Large, well balanced portfolio, transitioning to long life, low decline…
  4. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 4
    Capital allocation to maximize value Defined growth/value enhancement plans by product/basin Balance ?Product mix ?Project timelines ?Drill bit and acquisitions ?Strong balance sheet Opportunistic acquisitions Effective and…
  5. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 5
    0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 SIGNIFICANT VALUE TO UNLOCK Slide 4 1P Reserves After Royalties Note: Sourced from 2014 corporate reports. Peers include: APA, APC, EOG, CVE, CHK, DVN, ECA, HSE,…
  6. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 6
    $10 $20 $30 $40 $50 $60 TOP TIER F&D COSTS? Slide 5 F&D Costs Reserve Replacement ? 3 Year Average ($/BOE, net) Source: BMO Report, ?Oil & Gas: E&P? dated May 26, 2015. Peers include APA, APC, CHK, CVE, DVN, ECA, EOG, HSE,…
  7. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 7
    CNQ ? Conventional assets deliver field operating cash flow ? Fund the transition to long life, low decline asset mix ? Pelican Lake crude oil ?Leading-edge polymer flood ?Top tier operating costs deliver field operating cash flow ?…
  8. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 8
    CNQ 0% 10% 20% 30% 40% 50% 60% 70% 2007 2011 2015F 2018F Horizon - Sold as Synthetic Crude Oil Thermal In Situ - Sold as Heavy Crude Oil Pelican Lake - Sold as Heavy Crude Oil LONG LIFE ASSETS = MORE SUSTAINABLE CASH FLOW Slide…
  9. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 9
    CNQ 50 100 150 200 250 300 2015F 2017F 2018F HORIZON PRODUCTION DOUBLES BY 2018 Slide 8 Horizon Production Increases (MBOE/d) Note: Assumes current fiscal terms. Incremental 125,000 bbl/d Long life, no decline light oil…
  10. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 10
    CNQ ? Resource development ?Executing our defined plan ?Transitioning to a longer life low decline asset base ?Capital flexibility allows us to be nimble ? Dividend growth ?15 consecutive years of dividend increases ?Must be…
  11. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 11
    CNQ $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Dividend Share Purchase Horizon Phase 1 build years RETURNS TO SHAREHOLDERS A PRIORITY Slide 10 Return…
  12. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 12
    CNQ ? Committed to lowering cost structure ?Execution/productivity step changes ?Right scoping ?Leverage technology ?Regulatory effectiveness/efficiency ?Lower costs through the supply chain ? Committed to completing Horizon Phase…
  13. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 13
    CNQ ? Low commodity price provides opportunity to focus on ?Right scoping ?Innovation; leveraging technology ?Execution/productivity enhancements ?Gaining regulatory effectiveness/efficiency ?Lower costs through the supply chain ?…
  14. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 14
    CNQ ($ million) 2014 2015F Natural gas $767 $470 Crude oil Pelican Lake 246 170 Primary Heavy 1,253 480 Thermal In Situ 1,039 385 Light Canada 639 230 International 823 1,065 Total crude oil $4,767 $2,330 Horizon Sustaining…
  15. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 15
    Canadian Natural 2015 Production Budget Targeted Production 2014 2015F % Change(1) Crude oil (Mbbl/d) North America Light Oil & NGLs 89 91 - 96 5% Pelican Lake 50 53 - 55 8% Primary Heavy 143 130 - 133 (8%) Thermal In Situ Oil…
  16. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 16
    CNQ BUILDING A WORLD CLASS COMPANY Slide 15 Balanced, Diverse Portfolio ? Balanced, diverse production mix ? International exposure ? Vast, balanced resource base to develop ? Growing free cash flow Heavy Crude Oil ~35% Light…
  17. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 17
    CNQ ? Largest natural gas producer in Canada ? Q1/15 natural gas production of 1,713 MMcf/d ? Q1/15 average NGLs yield over 24 bbl/MMcf ? Large resource base ? 9.47 Tcfe reserves(1) ? Significant unconventional asset ? Montney…
  18. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 18
    2014 2015F % Change Production (MMcf/d)* 1,527 1,655 - 1,692 10% Drilling (net wells) 76 20 Capital ($ million) $767 $470 North America Natural Gas & NGLs 2015 Plan ? Capital discipline ? Preserve land base for increasing natural…
  19. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 19
    North America Light Crude Oil Core Area Summary Q1/15 light crude oil and NGLs production ? Record quarterly ~98 Mbbl/d ? 2P reserves ? Light crude oil 203 million barrels* ? High quality light crude oil horizontal multi-frac…
  20. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 20
    CNQ ? 2015 activity ? Target multiple formations across basin ? Leverage infrastructure and ?Drill-to-Fill? Drive capital efficiencies Maximize value ? Opportunities to optimize facilities and operating costs ? Leverage…
  21. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 21
    International Light Crude Oil Summary North Sea C?te d?Ivoire Gabon South Africa *Company gross proved plus probable reserves at December 31, 2014. ? Q1/15 light crude oil production ? ~36 Mbbl/d ? 2P light crude oil reserves ?…
  22. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 22
    International Light Crude Oil 2015 Plan Note: Rounded to the nearest 1,000 bbl/d. 2014 2015F % Change Crude oil production (Mbbl/d) 30 41 - 47 47% Capital ($ million) $823 $1,065 ? Offshore Africa ? Espoir 10 well infill drilling…
  23. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 23
    Primary Heavy Crude Oil Core Area Summary Largest primary heavy oil producer in Canada ? Q1/15 production of ~138 Mbbl/d ? Delivering strong execution ? Extensive land base and infrastructure ? Over 8,000 potential drilling…
  24. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 24
    CNQ 2014 2015F %Change Production (Mbbl/d) 143 130 - 133 (8% Drilling (net wells) 896 186 Recompletion (net wells) 637 568 Capital ($ million) $1,253 $480 STRONG CASH-ON-CASH RETURNS Slide 23 Primary Heavy Crude Oil 2015 Plan…
  25. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 25
    ? Wabiskaw heavy crude oil pool ? Industry leading EOR project ? Amongst the largest polymer flood in the world ? Technology development continue to improve crude oil recovery ? Leading example of technology driving value growth ?…
  26. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 26
    CNQ 2014 2015F %Change Production (bbl/d) 50 53 - 55 8% Drilling (net wells) ? Producers & Injectors 24 ? Capital ($ million) $246 $170 TECHNOLOGY ADVANCEMENT PROVIDES SIGNIFICANT UPSIDE Slide 25 Pelican Lake 2015 Plan Note:…
  27. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 27
    Thermal In Situ Oil Sands Land Holdings Birch Mtn. Gregoire Leismer Ipiatik Grouse Pelican Lake Germain Primrose Wolf Lake Hilda Lake Marie Lake Saleski ? Clearwater ? Primrose, Wolf Lake ? Hilda Lake, Marie Lak ?…
  28. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 28
    Thermal In Situ Oil Sands Tremendous Potential McMurray 49 billion barrels Wabiskaw 9 billion barrels Carbonates 10 billion barrels Clearwater 14 billion barrels Grand Rapids 15 billion barrels 97 billion barrels total…
  29. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 29
    Phase Reservoir Oil Facility Capacity Target (bbl/d) Primrose South/North CSS Clearwater 80,000 Primrose East CSS Clearwater 40,000 Kirby South SAGD McMurray 40,000 Kirby North Phase 1 SAGD McMurray 40,000 Grouse SAGD McMurray…
  30. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 30
    ? World Class asset ? 14.4 billion barrels BIIP(1) ? 2P SCO reserves ? 3.6 billion barrels(2) ? Best estimate contingent resources other than reserves ? 3.7 billion barrels of bitumen(3) ? Phased development (SCO) ? Current targeted…
  31. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 31
    Horizon Oil Sands - Operations 2015 Plan 2014 2015F % Change Production (Mbbl/d) 111 121 - 131 14% Sustaining Capital ($ million) $352 $275 Turnarounds & Reclamation ($ million) $50 $40 Capitalized Interest & Other ($ million) $225…
  32. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 32
    CNQ 98 89 85 75 89 85 85 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 98 100 Q1 2015 CNQ Peer 1 Peer 2 CNQ Peer 1 Peer 2 BEST IN CLASS OPERATIONAL PERFORMANCE S Horizon Oil Sands ? Operations…
  33. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 33
    Horizon Oil Sands - Expansion Production Capacity Plan Note: Capacity additions ? 3-6 months required to ramp up to full rates. Project progress dependent upon economic and regulatory conditions, commodity prices, global economic…
  34. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 34
    Horizon Oil Sands - Expansion Production Capacity Plan Note: Capacity additions ? 3-6 months required to ramp up to full rates. Project progress dependent upon economic and regulatory conditions, commodity prices, global economic…
  35. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 35
    $20.00 $22.00 $24.00 $26.00 $28.00 $30.00 $32.00 $34.00 50 100 150 200 250 300 2015F 2017F 2018F 2025F 2035F 2045F 2055F 2065F Target Production (LHS) Target Opex (RHS) HORIZON PRODUCTION DOUBLES BY 2018 Slide 35…
  36. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 36
    Horizon Oil Sands ? Operations Targeted Operating Costs ($ million) ($/bbl) Targeted Operating Cost per Year Targeted Operating Cost per Barrel *Phase 1 & 2A reflect 2015F data. Note: Cost estimated with mine diesel and gas/energy as…
  37. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 37
    CNQ ? Long term ratings ? S&P: BBB+ (Stable Outlook) ? Moody?s: Baa1 (Stable Outlook) ? DBRS: BBB High (Stable Trend) ? Short term ratings ? S&P: A-2 ? Moody?s: P-2 ? Strong financial position as of March 31, 2015 ? Debt/book…
  38. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 38
    CNQ ? Monetization of royalty assets considerations ? Outright sale ? IPO ? Retention ? Provides additional balance sheet strength ? Capitalize on available cash flow multiple Slide 3 Royalty Revenue Stream MAXIMIZING VALUE FOR…
  39. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 39
    CNQ 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% CNQ PXD EOG DVN APA APC CVE SU ? Substantial management and director wealth at stake ? Strong motivation for management to perform ? Delivers clear alignment with shareholder interests…
  40. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 40
    CNQ ? Strong balance sheet ? Large, diversified, well balanced asset base ? Transition to longer-life, low decline assets reduces capital requirements while maintaining production ? Delivering increasing and more sustainable cash…
  41. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 41
    Hedging Note: The Company?s outstanding commodity derivative financial instruments are expected to be settled monthly based on the applicable index pricing for the respective contract month. As at May 7, 2015, the Company had the…
  42. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 42
    Key Historic Data perational Information 2009 2010 2011 2012 2013 2014 Daily production, before royalties Crude oil and NGLs (Mbbl/d) 355 425 389 451 478 531 Natural gas (MMcf/d) 1,315 1,243 1,257 1,220 1,158 1,555 Barrels of oil…
  43. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 43
    Results of operations (C$ million, except per share) Cash flow from operations 6,090 6,333 6,547 6,013 7,477 9,587 per share ? Basic 5.62 5.82 5.98 5.48 6.87 8.78 Net earnings 1,580 1,673 2,643 1,892 2,270 3,929 per share ? Basic 1.46…
  44. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 44
    Corporate Guidance May 7, 2015 Q2/15 Guidance 2015 Updated Guidance Daily Production Volumes (before royalties) Natural gas (MMcf/d) 1,750 - 1,770 1,730 - 1,770 Crude oil and NGLs (Mbbl/d) North America 266 - 274 274 - 284 North…
  45. July 2015 Investor Presentation – Canadian Natural Resources Limited (CNRL) – slide 45
    Horizon Oil Sands Project Project capital Directive 74 40 Phase 2A 35 Phase 2B 1,255 Phase 3 535 Owner?s costs and other 280 Total capital projects 2,150 Technology and Phase 4 5 Sustaining capital 275 Turnarounds and…

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