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January 2016 Corporate Presentation – Pengrowth Energy Corp

Pengrowth Energy Corp · Jan 18, 2016 · 35 slides

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Slides

  1. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 1
    Corporate Presentation January 2016
  2. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 2
    Corporate Profile Corporate Summary Q3 2015 Avg. Daily Production 74,239 boe/d Production Mix1 60% liquids/40% gas Corporate Decline2 17% Undeveloped Land (net) 550,000 acres Reserves (2P YE 2014)3 557.4 million boe Reserve Life…
  3. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 3
    OUR STRATEGY IS TO BUILD A SUSTAINABLE ENTITY THROUGH SUSTAINABLE ENTITY THE DEVELOPMENT Large accumulations OF LARGE Long life assets Low declines ACCUMULATIONS OF Low cost structure OIL, BITUMEN AND CONVENTIONAL ASSETS Low sustaining…
  4. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 4
    Resource portfolio with increasing focus on oil and liquids development Corporate Presentation TSX : PGF NYSE : PGH 4
  5. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 5
    Dealing with the uncertainty in 2015 A significantly reduced capital program for 2015 of 200 million, representing a 78 percent reduction from 2014 Adjustment in dividend policy to a new level of 0.01/share per quarter and suspension…
  6. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 6
    Continuing actions in 2016 to reduce outstanding debt and strengthen balance sheet Corporate hedge book with market value of approximately 497 million as at December 31, 2015 providing cash flow stability* 2016 capital program to be…
  7. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 7
    Corporate hedging ensuring excess funds flow after capital program and dividends in 2016 Hedge positions as at December 31, 2015 Crude Oil1 Natural Gas Volume Percentage Average Volume Percentage Average Hedged2 Price Hedged2…
  8. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 8
    Stable funds flow despite significant declines in crude oil prices Quarterly Funds Flow Change in US WTI Oil Price 140 0% 120 -10% Funds flow from operations (Cdn mlns) % change in Crude oil price since Q3, 2014 100 -20%…
  9. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 9
    No debt maturities in 2016 DEBT COMPOSITION DEBT MATURITIES Long-term Notes () Convertible Debentures Credit Facilities Long-term Notes (Cdn) 7% 6% 138 Long-tern Notes (US) Convertible Debentures (Cdn) 15 400 265 25…
  10. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 10
    Pengrowths current debt metrics are well below covenant limits Actual December 31, 2015 Outstanding (Cdn Millions) Senior fixed term notes 1,614 Term Credit facilities/Bank debt 107 Senior Debt 1,721 Convertible debentures 137…
  11. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 11
    Third quarter 2015 highlights Continued growth in Lindbergh production as ramp-up proceeds Average production during third quarter was 14,564 bbl/d at an Instantaneous Steam Oil Ratio (ISOR) of 2.1x On track to reach 16,000 bbl/d…
  12. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 12
    Asset Overview
  13. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 13
    Lindbergh thermal oil Where and what is it Lindbergh Lindbergh Target formation Lloydminster 2P Reserves * 243 million bbls Best Estimate Contingent 101 million bbls Resources* 2P Reserves* NPV10 2,061 million Best Estimate…
  14. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 14
    Lindbergh characteristics 9o 11o API oil, 50,000 to 350,000 cP Clean continuous sands with no significant shales Reservoir characterized as nearshore marine sand Laterally extensive high quality cap rock Average depth of 540 m…
  15. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 15
    Lindbergh normalized average per meter production 1.2 30 ESP Conversions 28 1.1 25 1.0 23 Oil Rate per Screen Meter ((bbl/d)/m) 0.8 Pad D02 20 5 WPs 0.7 18 0.6 Pad D05 15 Well Count 8 WPs 13 0.5 10 0.4…
  16. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 16
    Lindbergh pilot well pair results point to higher recovery rates versus type curve expectations 1,400 Type Curve Lindbergh Actual* 1,200 1,000 Bitumen Production (bbl/d) 800 600 Type Curve based on 1.2 million bbl…
  17. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 17
    Lindbergh results demonstrate top quartile instantaneous steam-oil ratios and well productivity 2,000 1,800 1,600 1,400 Average well productivity (bbl/d) 1,200 Christina Lake (CVE) Firebag 1,000 800 Jackfish 1…
  18. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 18
    Lindbergh economics are top quartile within SAGD space Break even NPV10 = 0 US 43.07 WTI Cash flow =0 US 27.86 WTI 30% 70 Netback BT IRR 60 25% 50 Cash Netback (Cdn/bbl) 20% 40 IRR (%) 15% 30 10% 20 5%…
  19. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 19
    Lindbergh providing strong operating netbacks Three Months Ended ( Cdn/bbl unless otherwise noted) September 30, 2015 June 30, 2015 WTI price (US/bbl) 46.43 57.94 FX (USD/Cdn) 0.76 0.81 WTI Cdn 61.09 71.53 WCS 43.86 57.00 WCS…
  20. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 20
    Lindbergh competes with lowest cost production on world cost curve Average break even Oil Extra heavy oil Sands Ultra Deepwater Onshore rest of world Deepwater Onshore 72 Russia Cost (US per barrel) Offshore shelf…
  21. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 21
    Conventional Assets
  22. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 22
    Montney overview Significant development inventory Montney land holdings in excess of 50 sections Groundbirch (dry gas) Bernadet (liquids-rich) Pengrowth best estimate for total petroleum initially-in-place (PIIP) on company lands…
  23. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 23
    Multi-zone development opportunities SE FARRELL NW 1880m TVD 2174m TVD 2226m TVD 4 prospective and proven sub-zones are thought to exist within the Montney in the greater Bernadet and Groundbirch areas 2409m TVD Montney…
  24. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 24
    Pengrowth Montney play overview BERNADET GROUNDBIRCH 32.6 sections (100 percent working 21 gross sections (90 percent working interest) interest) Expected to provide a scalable, low risk stacked zone liquids-rich play on Pengrowths…
  25. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 25
    Bernadet - Development potential Four prospective and proven sub-zones thought to exist within the Montney in the greater Bernadet area U3 M1 L1 Upper L1 Lower Pengrowth Montney Lands Corporate Presentation TSX :…
  26. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 26
    Groundbirch - Development potential Four prospective and proven sub-zones exist within the Montney at Groundbirch 2014 program targeted the U1 Upper U1- Upper and U2 zones U1 Lower U2 U3 Pengrowth Montney Lands…
  27. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 27
    Montney economics provide strong returns that compete with oil plays BERNADET1 GROUNDBIRCH1 Per Well Unrisked Per Well Unrisked Case 1 Case 2 Case 3 Case 1 Case 2 Case 3 Metrics Metrics DCET ( millions/well) 5.5 5.5 5.5 DCET (…
  28. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 28
    Summary
  29. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 29
    Conclusion DESPITE THE VOLATILE MARKETS, PENGROWTH CONTINUES TO DELIVER SIGNIFICANT RESULTS Focused on preserving and improving financial strength Targeting debt reduction through organically generated free cash flow and proceeds…
  30. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 30
    APPENDIX
  31. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 31
    2015 guidance striking a balance Corporate Guidance Capital ( Millions) 190 to 210 Average daily production (boe/d) 70,000 to 72,000 Royalties (%) 11 to 14 Net operating costs (/boe) 15.50 to 16.50 Cash General &…
  32. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 32
    Third quarter 2015 Financial and operating highlights Three Months Ended September 30, June 30, (Cdn millions, except per share and per boe amounts) 2015 2015 Production (boe/d) 74,239 74,113 Gas 40% 42% Liquids 60% 58%…
  33. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 33
    Greater Olds/Garrington area Large, contiguous land base RED DEER with access to multi-tier development opportunities SYLVAN LAKE Focus has been on Cardium INNISFAIL development over past two years GARRINGTON Over 500 gross…
  34. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 34
    Pengrowth has a dominant position in the Garrington, Olds and Lochend areas Light oil (35o to 50o oil) and liquids-rich natural gas with stacked (deep basin type) horizons Large land foot print 377,000 net acres ( 16 townships)…
  35. January 2016 Corporate Presentation – Pengrowth Energy Corp – slide 35
    Swan Hills Trend - Low decline with strong cash flow Devil 100% WI House Mountain Conventional and unconventional asset with House significant original oil in place (OOIP) Unit No.1 Mountain 19.3% WI Unit No.2 7.1% WI Deer…

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