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Peters and Co Energy Conference – Zargon Oil & Gas Ltd

Zargon Oil & Gas Ltd · Sep 17, 2015 · 22 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. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 1
    Peters & Co. Energy Conference (Sept. 2015) Panel Topic: Maximizing Oil Netbacks zargon.ca
  2. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 2
    Investment Highlights Zargon High operatorship (89%) characteristics. Assets High light/medium oil and liquids weighting (81%). Low production decline (13% for oil and liquids). The current reserve report has 17 proved plus an…
  3. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 3
    Core Areas Williston Q2 2015 production of 1,741 bbl/d and 0.47 mmcf/d. Basin Proved and probable reserves of 7,930 mbbl and 1.23 bcf at Dec 31, 2014. Proved and probable producing reserves of 7,022 mbbl and 1.20 bcf at Dec 31,…
  4. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 4
    Zargon Overview (September 10, 2015) Capitalization Toronto Stock Exchange: Symbols: ZAR; ZAR.DB Common Shares Outstanding: 30.30 million (basic) Market Capitalization: 45 million (1.50 per share) (1) Net Debt at June 30, 2015: 112…
  5. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 5
    Key Developments Strategic August 13, 2015 Q2 Release and Announcement of Strategic Alternatives Review: Alternatives Board forms a Special Committee to identify and consider strategic and Review financial alternatives available to…
  6. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 6
    Waterflood/drive Well Inventory Drilling Inventory of 75+ net horizontal wells. Over the last couple of years, conventional oil exploitation drilling activities have been curtailed as the Company has been allocating available…
  7. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 7
    Williston Basin Locations Drilling Inventory In the last 20 months Zargon has drilled only eight Williston Basin wells, as essentially all discretionary capital has been redirected to the Little Bow ASP project. Zargon has more than…
  8. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 8
    Long-Life, Low-Decline Oil Volumes Average Annual Decline Rate (%) Zargon Corporate Decline Analysis - Total Oil Production Rate 6,000 0 10 20 30 40 50 Gross W.I. Oil Production Rate ( bbl/day ) 5,000 Zargon 4,000 3,000…
  9. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 9
    Little Bow ASP EOR in a mature Southern Alberta Waterflood Little Bow ASP: Phase 1&2 Development 15-18W4 Little Bow Mannville P Pool Little Bow Mannville I Pool Zargon Land Zargon Wells Phase 1 Area Phase 2 Area…
  10. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 10
    Phase 1 Q3 2015 Infill Drilling Results 02/11-32-014-18W4 04/13-32-014-18W4 04/16-31-014-18W4 Gamma Resistivity Gamma Resistivity Gamma Resistivity 0 50 100 150 1 10 100 1000 0 50 100 150 1 10 100 1000 0 50 100 150 1 10 100 1000…
  11. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 11
    Little Bow ASP: Phase 1 Production Oil cut trends continue to encourage. Q3 2015 remedial and optimization program (workovers and 3 new wells) has increased oil production. Reservoir models and reserve forecasts are being…
  12. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 12
    Phase 1 Response vs. Forecast Little Bow ASP Oil Production 1800 McDaniel TP+P 1600 2015 /16 increment = 132 / 797 bbl/d Ultimate: 2.45 million barrels 1400 June - August production was impacted by injection line 1200 outages…
  13. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 13
    Panel Topic: Maximizing Oil Netbacks (i.e. survival with extended low oil prices) zargon.ca
  14. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 14
    Survival with Extended Low Oil Prices Current Situation Zargon has low decline, long-life oil exploitation assets that are well suited for providing stable dividends at higher oil prices. Although delayed, the Little Bow ASP project…
  15. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 15
    Cost Reductions (Extended Low Oil Price Case) Conventional Oil Exploitation Capital (defer all non-discretionary costs): Capital 38 million (2014), 6 million (2015), 4 million (2016). Costs ASP Capital (defer Little Bow Phase 2;…
  16. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 16
    2016 Cash Flow Parameters (Extended Low Oil Price Case) Conv. Oil 3,150 bbl/d in 2016; 13% annl. decline from Q3 2015 (est.) rate of 3,525 bbl/d. Production ASP Oil 400 bbl/d increment (assumes polymer only injections); up from…
  17. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 17
    Commodity Hedges Hedging Zargon uses hedges to help fund dividends and capital programs during periods Strategy of lower commodity prices. Forward Oil July 2015: 1,000 bbl/d at 80.02 Cdn./bbl (WTI) Sales Aug Dec 2015: 1,500…
  18. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 18
    2016 Cash Flow Projections (Extended Low Oil Price Case) Reduce debt in preparation for June 2017 maturity of 57.5 million of convertible Objectives debentures. Maintain oil production at essentially stable levels. Seek and…
  19. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 19
    Key Takeaways Zargons unique low-decline asset provides stable volumes in this challenging low price Balance period. Due to these asset attributes, we project that Zargon can survive another year Sheet (OK (2016) of 50 US/bbl WTI oil…
  20. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 20
    McDaniel 2014 Yr. End Net Asset Value Waterflood & 2015/Q2 Production McDaniel Reserves McDaniel Waterdrive Oil Gas Oil Gas PV10 Asset Value Properties (bbl/d) (mmcf/d) (mmbbl) (bcf) (million) Williston Basin 1,741 0.47 7.93 1.23…
  21. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 21
    Estimated Tax Pools Category Dec. 31, 2014 Canadian Exploration Expense 58 million Non Capital Losses 102 million Canadian Development Expense 34 million Canadian Oil & Gas Property Expense nil million Canadian Undepreciated…
  22. Peters and Co Energy Conference – Zargon Oil & Gas Ltd – slide 22
    Directors and Officers Craig H. Hansen Jim Peplinski Board of Directors K. James Harrison Ron Wigham Kyle D. Kitagawa Grant A. Zawalsky Geoffrey C. Merritt Officers Craig H. Hansen President and Chief Executive Officer Leslie…

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