Annual and Special Meeting May 2015 Canadian Oil Sands Limited Investor Presentation
Syncrude: a high quality resource ? Established production base ? Fully upgraded light, sweet crude oil ? Proven operator and proven technology ? Predictable reservoir recovery ? over 90% ? Non-declining production profile ? 40+…
Reducing operating costs Q1 2014 Q1 2015 2015 Outlook 1 2014 Actual $47/barrel $36/barrel $49/barrel $39/barrel $11 $10 1. Per 2015 Outllook as at April 30/15
Focused on operational performance Rebuild and redesign mine trains ? Retrofit and reconfigure bitumen centrifuges ? Replace heat exchangers in hydrogen plants ? Fully commission MLMR and demonstrate design rates 2015 Modifications…
Major Projects successfully completed On Time Under Budget Under Budget ($millions) Aurora Mine Train Relocation ? ? $200 Aurora Tailings Management ? ? $50 Mildred Lake Mine Train Replacement ? ? $400 Centrifuge Tailings…
0 200 400 600 800 1000 1200 1400 2011 2012 2013 2014 2015F Major Projects Regular Maintenance Significantly lower capex requirements $ millions, net to Canadian Oil Sands 1,2 1. Capital costs only; excludes capitalized…
Cost to produce Syncrude?s fully upgraded oil Break-even cost based on 2015 Outlook(1,2) CAD $/barrel (approximate) Operating expenses 39 Regular maintenance capital expenditures 3 8 Crown royalties 4 Development expenses &…
Strong liquidity position ? Net debt1 is $2.2 billion at March 31 ? Long-term debt-to-total capitalization1 at 35% ? No long-term bond payments until 2019 ? Credit facilities totalling $1.5 billion ? Recent dividend reduction…
Dividends reflect free cash flow over time (1,2) 1. Includes distributions on trust units prior to Dec. 31/10 2. Free cash flow (FCF) is cash flow from operations less capital expenditures and is a non-GAAP measure 3. 2015 Dividend and…
High value Syncrude barrel WTI Bakken Syncrude SCO Value (as % of crude price) 2 29 37 8 25 3 28 37 6 26 2 16 48 33 65% 100% 115+% 110% 65-70% Based on analysis provided to COS by Muse Stancil; crude oil fractions shown…
Kitimat Hardisty Edmonton Burnaby Cushing Montreal Houston Sarnia Patoka Quebec City Markets for COS? Syncrude production Chicago Syncrude Current synthetic crude oil markets Potential new markets
Global oil demand vs. production (excluding US tight oil) 75.0 77.0 79.0 81.0 83.0 85.0 87.0 89.0 91.0 93.0 95.0 75.0 77.0 79.0 81.0 83.0 85.0 87.0 89.0 91.0 93.0 95.0 Mm Bbls/Day Global Oil Production* Without…
Declining U.S. oil rig count Source: http://gis.bakerhughesdirect.com/Reports/YearToYearCompChart.aspx?chrtName=prdOilChrt
COS share price is correlated to oil price Source: Bloomberg 0 50 100 150 200 250 300 350 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 COS WTI
2015F 2015F 2015F Positioned for oil upside 1. Based on assumptions contained in 2015 Outlook issued April 30, 2015: USD $55/bbl WTI, $0.82 CAD:USD FX, $39.48/bbl operating expenses and sales of ~103,700 bbls/d; assumes COS continues…
COS offers compelling valuation $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 Plus, COS offers: ? Upgrader producing light, sweet crude oil ? All of our reserves and resources ? Producing today 1. COS? value…
COS highlights 1. Syncrude is a world-class asset 2. Focus on improving long-term profitability ? higher production, lower costs 3. COS positioned well during a period of low oil prices 4. COS is highly levered to oil price recovery
Syncrude joint venture structure Canadian Oil Sands 25% (COS) Suncor Sinopec 36.74% 12% Nexen (CNOOC) 7.23% Murphy Oil Mocal (JX Nippon) 5% Imperial Oil ExxonMobil and Imperial provide global best practices, proprietary…
Mildred Lake Extension (MLX)
Syncrude Crown royalty terms* ? Greater of 25% net bitumen revenue less capital and operating costs, or 1% of gross bitumen revenue* ? Previously based on Synthetic Crude Oil (upgraded from bitumen) revenues and costs ? Repay $1.25…
2015 Crown royalty calculation 1. Bitumen revenue is based on an SCO yield of 85% and a bitumen price equal to 60% of C$WTI. 2. Royalty rate is the greater of 25% of net revenue or 1% of revenue. 3. Before capitalized interest. 4. As…
New Royalty framework ? Greater of: ? Gross deemed bitumen revenues less capital and operating costs, starting at 1% and rising to 9% ? Net deemed bitumen revenues less capital and operating costs, starting at 25% and rising to 40%…
Quality and location differentials dn $/bbl
Canadian & US crude oil pipeline proposals
Canadian pipeline capacity vs 2014 supply forecast Enbridge Mainline Trans Mountain Express PADD IV Source: CAPP
Syncrude: a leader in responsible oil sands development Reflects industry best practices ? Mining Association ? Toward Sustainable Mining ? Canadian Association of Petroleum Producers ? Responsible Canadian Energy Program ? Canadian…
2015 Guidance Document April 30, 2015 (All financial figures are in Canadian dollars unless noted otherwise) 2015 Outlook Syncrude Synthetic Crude Oil Production Outlook 1 95 - 110 260,000 - 301,000 Canadian Oil Sands Synthetic…
2015 Cash Flow From Operations Sensitivities (After Tax) 8,9,10 $ Millions $/Share $29 $0.06 $14 $0.03 $19 $0.04 $23 $0.05 $22 $0.05 $12 $0.02 2015 Capital Expenditures Syncrude COS Share Major Projects ($ millions) ($…
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