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September 2015 Investor Presentation – Bonavista Energy Corp

Bonavista Energy Corp · Sep 10, 2015 · 43 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. September 2015 Investor Presentation – Bonavista Energy Corp – slide 1
    INVESTOR PRESENTATION September 2015
  2. September 2015 Investor Presentation – Bonavista Energy Corp – slide 2
    THIS IS BONAVISTA 79,345 boe/d production BLUEBERRY 70,600 boe/d in our core regions 74% natural gas 74% in our core regions DEEP BASIN 7.02 /boe operating costs 6.63/boe in our core regions WEST CENTRAL 1,693 locs…
  3. September 2015 Investor Presentation – Bonavista Energy Corp – slide 3
    THIS IS BONAVISTA VALUE CREATION EFFICIENT FOCUSED QUALITY QUALITY base in our core areas assetbase in our execution 94% of net Added production operating 2014 recycle at 17,000/boed ourasset income ratio…
  4. September 2015 Investor Presentation – Bonavista Energy Corp – slide 4
    THIS IS BONAVISTA QUALIFIED EXPERIENCED DEDICATED Bonavista has Insiders own Management has INVESTED 18 years 10% 10 year of operational of the average tenure presence in corporation with Bonavista western Canada 6
  5. September 2015 Investor Presentation – Bonavista Energy Corp – slide 5
    TRACK RECORD
  6. September 2015 Investor Presentation – Bonavista Energy Corp – slide 6
    TRACK RECORD Production growth: 90,000 85,000 80,000 Production (boe/d) 75,000 70,000 65,000 60,000 2012 2013 2014 2015F * 2012 2015F 8 ** Proved + probable including changes in Future Development Costs
  7. September 2015 Investor Presentation – Bonavista Energy Corp – slide 7
    TRACK RECORD Production addition costs*: 40,000 Production Addition Costs (/boed) BNP 2015F 13,000 - 15,000/boed 35,000 30,000 25,000 20,000 15,000 10,000 2012 2013 2014 2015F Bonavista Peer Group Average…
  8. September 2015 Investor Presentation – Bonavista Energy Corp – slide 8
    TRACK RECORD Operating efficiency continues to improve: 15% Operating Costs * (% change from H1 2012) 10% 12.34 5% 6% 0% -5% -10% 25% -15% -20% 6.96 -25% -30% H1 2012 H2 2012 H1 2013 H2 2013 H1 2014 H2…
  9. September 2015 Investor Presentation – Bonavista Energy Corp – slide 9
    ASSET QUALITY
  10. September 2015 Investor Presentation – Bonavista Energy Corp – slide 10
    KEY PLAY INVENTORY Many years of high quality development: Locations (gross) in our key play inventory*: 1,283 Glauconite: Hoadley 326 Strachan 90 Total Glauconite 416 SPIRIT RIVER 404 locations Spirit River: 32% GLAUCONITE…
  11. September 2015 Investor Presentation – Bonavista Energy Corp – slide 11
    KEY PLAY INVENTORY Expanding our most profitable plays Glauconite and Spirit River: July 2014 Added Drilled July 2015 LOCATIONS LOCATIONS (GROSS) 621 298 99 820 (NET) 478 332* 84 726 increase in our 50% Glauconite and…
  12. September 2015 Investor Presentation – Bonavista Energy Corp – slide 12
    QUALITY OF INVENTORY Glauconite and Spirit River are among the best: Top 20 North American Natural Gas Plays - Half Cycle Payouts 10 9 8 Payout (Years) 7 6 5 4 3 2 1 0 Source: Peters & Co. Limited, based on US…
  13. September 2015 Investor Presentation – Bonavista Energy Corp – slide 13
    2015 E&D SPENDING ALLOCATION Concentrated spending on profitable plays: Wells Expenditures % of Value Gross Net ( millions) Expenditures West Central: Glauconite 49 37.7 128 48 Spirit River Other 9 - 9.0 - 31 1 12 - 91% Glauconite…
  14. September 2015 Investor Presentation – Bonavista Energy Corp – slide 14
    GLAUCONITE Extensive, predictable resource: Hoadley Drilled 247 wells to end of 2014 46 (34.7 net) wells planned for 2015 Operating costs of 4.50/boe 326 locations in prospect inventory Strachan Drilled 8 wells to end of 2014…
  15. September 2015 Investor Presentation – Bonavista Energy Corp – slide 15
    GLAUCONITE Reliable production growth: 30,000 25,000 Current Production of 26,900 boe/d Quarterly Production (boe/d) 20,000 15,000 10,000 5,000 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3…
  16. September 2015 Investor Presentation – Bonavista Energy Corp – slide 16
    GLAUCONITE Improving cost structure: 3,500 Cost to Drill and Complete (000s) 3,000 2,500 10,500/boed * 12,800/boed * 12,400/boed * 16,100/boed * 2,000 1,500 1,000 2014H1 2014H2 2015H1 2015H2 (to date)…
  17. September 2015 Investor Presentation – Bonavista Energy Corp – slide 17
    HOADLEY GLAUCONITE Sensitivity to propane and natural gas pricing: 70% 20-25% IRR with no value attributed to propane recovery 60% (2.75 to 3.00 per gj AECO) 50% Internal Rate of Return* 40% 30% 20% 20/bbl, Propane…
  18. September 2015 Investor Presentation – Bonavista Energy Corp – slide 18
    SPIRIT RIVER WILRICH Ansell Drilled 18 wells to end of 2014 16 (16.0 net) wells planned for 2015 Operating costs of 4-5/boe 217 locations in prospect inventory Marlboro Drilled 35 wells to end of 2014 No wells planned for 2015…
  19. September 2015 Investor Presentation – Bonavista Energy Corp – slide 19
    SPIRIT RIVER WILRICH Compelling growth: 14,000 12,000 Current Production of 12,500 boe/d Quarterly Production (boe/d) 10,000 8,000 6,000 4,000 2,000 0 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2012 2013 2014 2015…
  20. September 2015 Investor Presentation – Bonavista Energy Corp – slide 20
    SPIRIT RIVER WILRICH AT ANSELL Building a low cost, scalable opportunity: 56 net sections at year end 2014 Added 44 net sections year to date 217 locations in inventory September 2015: 65 mmcf/d BNP operated plant 105 mmcf/d…
  21. September 2015 Investor Presentation – Bonavista Energy Corp – slide 21
    SPIRIT RIVER WILRICH AT ANSELL Ample egress for continued growth: 150 125 Sales Natural Gas (mmcf/d) 100 75 50 25 0 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Ansell…
  22. September 2015 Investor Presentation – Bonavista Energy Corp – slide 22
    SPIRIT RIVER WILRICH AT ANSELL Improving cost structure: 6,000 Cost to Drill and Complete (000s) 5,000 4,000 10,600/boed * 14,800/boed * 16,300/boed * 16,700/boed * 3,000 2,000 1,000 2014H1 2014H2…
  23. September 2015 Investor Presentation – Bonavista Energy Corp – slide 23
    SPIRIT RIVER WILRICH Sensitivity to well capital* cost: 80% 5%-10% improvement in IRR for every 0.5 million reduction in well cost 70% (2.75 to 3.00 per gj AECO) 60% Internal Rate of Return ** 50% 40% 30% 4.0 million 20%…
  24. September 2015 Investor Presentation – Bonavista Energy Corp – slide 24
    SPIRIT RIVER FALHER/NOTIKEWIN Morningside Falher 8 (8.0 net) wells planned for 2015 44 locations in prospect inventory 52 sections (gross) of land Strachan Falher 1 (1.0 net) well planned for 2015 36 locations in prospect…
  25. September 2015 Investor Presentation – Bonavista Energy Corp – slide 25
    SPIRIT RIVER FALHER Prolific production performance at Morningside: 4,500 4,000 Current Production of 4,200 boe/d Quarterly Production (boe/d) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1…
  26. September 2015 Investor Presentation – Bonavista Energy Corp – slide 26
    SPIRIT RIVER MORNINGSIDE FALHER Sensitivity to commodity pricing: 90% Efficient capital structure generates strong returns 80% (2.75 to 3.00 per gj AECO) 70% Internal Rate of Return 60% 50% 40% 30% US55/bbl WTI 20%…
  27. September 2015 Investor Presentation – Bonavista Energy Corp – slide 27
    LOOKING FORWARD
  28. September 2015 Investor Presentation – Bonavista Energy Corp – slide 28
    LOOKING FORWARD 2015 guidance: Actual Forecast % 2014 2015 Change Capital expenditures ( millions): Exploration and development 640 315 335 (49) Divestitures, net of acquisitions (107) (15) (86) Total 533 300 320 (42) Production…
  29. September 2015 Investor Presentation – Bonavista Energy Corp – slide 29
    LOOKING FORWARD - SENSITIVITIES Funds from operations with production maintained at 80,000 boe per day in 2016 600 550 74% natural gas weighting and Funds from Operations* ( millions) 500 450 hedge position minimize…
  30. September 2015 Investor Presentation – Bonavista Energy Corp – slide 30
    LOOKING FORWARD - SENSITIVITIES Capital required to maintain production at 80,000 boe/d for 2016 Continued improvements in capital efficiency, 350 106% * will lead to production maintenance with 300 between 200-250 million E&D…
  31. September 2015 Investor Presentation – Bonavista Energy Corp – slide 31
    STRENGTHS OF BONAVISTA SUSTAINABLE BUSINESS PLAN Optimizing total return with 100% total payout FOCUSED Maximizing efficiency with a concentrated asset base EFFICIENT Finding better ways to compete A DECADE OF INVENTORY…
  32. September 2015 Investor Presentation – Bonavista Energy Corp – slide 32
    APPENDIX
  33. September 2015 Investor Presentation – Bonavista Energy Corp – slide 33
    FINANCIAL STRATEGY Natural gas hedging: 300 4.00 3.80 Hedged Volumes (thousands gjs/d) 250 3.60 3.40 200 3.20 CDN/gj 150 3.00 2.80 100 2.60 2.40 50 2.20 85% 71% 0 2.00 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16…
  34. September 2015 Investor Presentation – Bonavista Energy Corp – slide 34
    FINANCIAL STRATEGY Oil hedging: 8 120.00 110.00 Hedged Volumes (mbbls/d) 6 100.00 90.00 CDN/bbl 4 80.00 70.00 2 60.00 50.00 66% 75% 0 40.00 Q3-15 Q4-15 Q1-16 Q2-16 Q3-16 Q4-16 Collars (mbbls/d) Swap…
  35. September 2015 Investor Presentation – Bonavista Energy Corp – slide 35
    TOTAL & SENIOR DEBT (as at June 30, 2015): ( millions) Senior notes (CAD) 70 Unutilized bank capacity 350 Bank credit facility - 600 million 11 banks in Bonavista bank credit facility Unsecured, financial covenants Credit…
  36. September 2015 Investor Presentation – Bonavista Energy Corp – slide 36
    LOOKING FORWARD Total and Senior Debt / EBITDA: Year ended December 31, Forecast * 2015 ( millions) Revenue, net of royalties 698 Realized losses on financial instrument commodity contracts - 698 Expenses: Operating 203…
  37. September 2015 Investor Presentation – Bonavista Energy Corp – slide 37
    2015 REVENUE EXPOSURE By volume By value 6% 2% 1% 6% 7% 4% 11% 5% 7% 59% 21% 71% Ethane Propane Butane Pentane Oil Gas 39
  38. September 2015 Investor Presentation – Bonavista Energy Corp – slide 38
    VALUE CREATION Key play metrics at 2.75/gj AECO and US45.00/bbl WTI*: Recycle Ratio** (x:1) Payout (months) Glauconite Glauconite Falher Falher Spirit River Wilrich Wilrich 0 1 2 3 4 0 24 48 Internal Rate of Return (%)…
  39. September 2015 Investor Presentation – Bonavista Energy Corp – slide 39
    GLAUCONITE Type curve: Type Curve Capex ( millions) 2.7 700 IP12 (boe/d) 270 /boed 9,840 600 EUR (mboe) 501 500 IRR (%) 25 Production (boe/d) F&D (/boe) 5.29 400 P/I 0.4 Recycle Ratio 2.8 300 Payout (years) 3.2…
  40. September 2015 Investor Presentation – Bonavista Energy Corp – slide 40
    SPIRIT RIVER - WILRICH Ansell Wilrich type curve: Type Curve Capex ( millions) 4.5 900 IP12 (boe/d) 360 800 /boed 12,470 EUR (mboe) 733 700 IRR (%) 25 Production (boe/d) 600 F&D (/boe) 6.14 P/I 0.5 500 Recycle Ratio 2.8…
  41. September 2015 Investor Presentation – Bonavista Energy Corp – slide 41
    SPIRIT RIVER - FALHER Morningside Falher type curve: Type Curve Capex ( millions) 2.4 1,000 IP12 (boe/d) 320 900 /boed 7,480 800 EUR (mboe) 510 IRR (%) 38 700 Production (boe/d) F&D (/boe) 4.69 600 P/I 0.7 500 Recycle…
  42. September 2015 Investor Presentation – Bonavista Energy Corp – slide 42
    2014 RESERVES SUMMARY Replaced 2014 annual production by 200%, adding 56 mmboe of 2P reserves Natural Gas Total Natural Gas Oil Liquids Reserves(2) Reserves:(1)(4) (mmcf) (mbbls) (mbbls) (mboe) Proved: Proved producing 661,960…
  43. September 2015 Investor Presentation – Bonavista Energy Corp – slide 43
    ESTIMATED TAX POOLS as at June 30, 2015 Category millions % of Total Canadian Oil & Gas Property Expense 732 28% Canadian Development Expense 851 32% Canadian Exploration Expense 314 12% Undepreciated Capital Cost 414 15%…

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