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February 2014 Investor Presentation – Advantage Oil & Gas Ltd.

Advantage Oil & Gas Ltd. · Feb 6, 2014 · 32 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. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 1
    Investor Presentation February January 2014 2013
  2. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 2
    Advantage Pure Play Montney Producer Listed on TSX & NYSE AAV Shares Outstanding (basic) 168.4 million Enterprise Value January 31, 2014 4.53/share 1.1 billion Glacier Production January 2014 124 mmcfe/d Q2 2014 Phase VI Budget…
  3. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 3
    Strategic Alternatives Review Completed Advancing Organic Growth Board of Directors has completed an extensive & thorough review of our strategic alternatives Proposals did not adequately reflect the intrinsic value of the…
  4. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 4
    Three Year Glacier Development Plan & Glacier Phase VII Budget Approval Current Glacier Phase VI program achievements validate resource upside & drives robust drilling economics through improved well results Board of Directors has…
  5. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 5
    Three Year Growth Plan Reinforced by Solid Financial Strategy Advantage has mitigated financial risk in our development plan: Strengthened balance sheet - reduced bank debt 58% to 64 million (1) Sale of Longview shares Termination of…
  6. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 6
    Three Year Glacier Development Plan Summary Development Plan (3) Phase VI Phase VII Phase VIII Phase IX Q213 to Q214 to Q215 to Q216 to Q114 Q115 Q116 Q117 Current Approved Estimates Estimates Production (mmcfe/d) 12 month…
  7. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 7
    Glacier Phase VII Budget & Guidance Approved Phase VII Budget & Guidance (1) 12 Months ending March 31, 2015 Average Production (mmcfe/d) 134 to 139 End of Phase Production Rate Q2 2015 183 (mmcfe/d) Royalty Rate (%) 5% to 6%…
  8. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 8
    Industry Leading Cost Structure 2012 metrics AAV current operating costs 0.28/mcfe April 2013 Page 8
  9. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 9
    Industry Leading Operating Cost Performance at Glacier Advantage has consistently reduced operating costs through each development phase. Current operating costs 0.28/mcfe. Page 9
  10. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 10
    Glacier Netbacks & Recycle Ratio Contribute to Strong Drilling Economics Liquids Rich Gas(2) Netbacks & Recycle Ratios Dry Gas(2) (/mcfe) (/mcfe) 2012 2P Finding and Development Cost including FDC (1): 1 year 0.73 . 1.73 . 3 year…
  11. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 11
    Glacier Montney Well Economics (1) Dry Gas Liquids Rich Gas Upper and Lower Montney (2) Middle Montney Intervals (3) 12.7 million New completion techniques are supporting higher 10.9 million type curves Rate of Return…
  12. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 12
    Glacier Five Interval Development (Pentastack) 1,280 Locations Remain Beyond 2017 - Post Development Plan 1,400 current future locations Five 50 meter intervals are available for development based on 4 wells/section/layer…
  13. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 13
    Glacier Middle Montney Liquids Extraction Decision to install shallow cut liquids extraction Glacier process at existing 100% owned Glacier gas plant 1 Glacier Alliance Pipeline Initial Phase VII program targets 25 mmcf/d of Gas…
  14. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 14
    Current Phase VI Glacier Program Achievements Supports Development Plan Record Glacier production rate of 124 mmcfe/d (20,600 boe/d) entering 2014, driven by strong well results & operational execution exceeding expectations Total…
  15. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 15
    Upper Montney Phase VI Confirms Exceptional Well Performance Across Glacier 21 mmcf/d record well 15 mmcf/d 10 mmcf/d No Wells Drilled 14 mmcf/d Phase VI wells are proving up reserves in east Glacier at above well…
  16. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 16
    New Completion Techniques Upper Montney 2x - 3x Production Improvement at Glacier (graphs updated to January 4, 2014) Production Rate vs Time Recent Glacier Upper New 5-20 Phase VI well Montney wells show up to started production…
  17. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 17
    Lower Montney Phase VI Proves Up East Glacier Reserves 43.7 mmcf/d mmcf/d 7 6.8 mmcf/d mmcf/d Previous two LM wells 16 mmcf/d & 14 mmcf/d 3 3.6 mmcf/d mmcf/d Phase VI wells proving up reserves on east side of Glacier &…
  18. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 18
    New Completion Techniques Lower Montney 3x Production Improvement at Glacier (graphs updated to January 4, 2014) Production Rate vs Time Recent Glacier Lower New 10-31 & 15-31 Montney wells show up to Phase VI wells above 3x…
  19. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 19
    Middle Montney Phase VI Record 13 MMcf/d Well With Free Condensate Trend shows increasing liquid yield west to east Liquids are pervasive through entire Glacier land block 8 mmcf/d 26 bbl/mmcf 8 bbl/mmcf 8 mmcf/d 40 bbl/mmcf 57…
  20. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 20
    New Completion Techniques Middle Montney 3x Production Improvement at Glacier (graphs updated to January 4, 2014) Production Rate vs Time Glacier Middle Montney wells completed Q1 2013 show up to 3x improvement & significantly New…
  21. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 21
    New Montney Lands Prospective for Natural Gas Liquids (1) Phase VI drilling results confirm increasing liquids in east Glacier & extends liquids potential to new lands Technical work to date indicates thick Montney formation & multiple…
  22. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 22
    New Montney Lands Type Logs Show Thick Formation & Multiple Layer Potential Glacier Type Log Valhalla Type Log Wembley Type Log Valhalla Upper Upper (Upper Missing) Glacier Liquids Rich Layers Wembley Glacier Liquids…
  23. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 23
    Advantage Summary Focused on our world class 16 Tcf TPIIP Glacier Montney property and development of its 4.2 Tcfe contingent resources & 1.6 Tcfe 2P reserves(1): Three Year Glacier Development plan supported by solid financial…
  24. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 24
    Appendix Page 24
  25. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 25
    Montney Siltstone Supports High Reserve Recoveries Shale Silt Sand 84 gross (77 net) sections - Historic type curve based on 86 wells with an average of 11.5 fracs per well The Montney formation is a siltstone and sand…
  26. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 26
    2012 Core & Completion Studies Increased Resource & Improved Well Results Core study determined original density porosity logs have to be re-calibrated Re-calibration aligned log to actual IP30s on open hole core porosities evident…
  27. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 27
    Summary of Well Tests Referenced in Presentation Slides Final Gas Final Flow Normalized Estimated Test Rate Test Period Pressure Final Gas Test Rate (1) C3+ liquid yield Well Formation (mmcf/d) (hrs) (kpa) (mmcf/d) (bbls/mmcf) (2)…
  28. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 28
    Recent Glacier Upper & Lower Montney Slickwater Wells Recent Upper & Lower Montney wells completed with slickwater fracs are outperforming Phase VII Budget type curve which is based on an IP30 6.9 mmcf/d. Production from these…
  29. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 29
    Glacier Drilling Economics & 2P Recoveries per Interval ( millions unless otherwise indicated) Glacier Drilling Economics PVs 10% Discount(1) Dry Gas(3) Liquids Rich Gas(4) AECO C natural gas price (/mcf)(2) 3.00 4.00 5.00 3.00 4.00…
  30. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 30
    Appendix A Glacier Contingent & Prospective Resource Assessment Advantage engaged our independent qualified reserves evaluator Sproule Associates Ltd. (Sproule) to update the resource analysis and provide a 2C evaluation (Sproule 2C…
  31. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 31
    Appendix A Glacier Contingent & Prospective Resource Assessment Low Best High UPIIP (AAV Working Interest, Sales) (3) Estimate Estimate Estimate Natural Gas Prospective Resources (Tcf) 0.342 0.556 0.776 Unrecoverable UPIIP (Tcf)…
  32. February 2014 Investor Presentation – Advantage Oil & Gas Ltd. – slide 32
    Appendix A Glacier Contingent & Prospective Resource Assessment 2C (Best Estimate) Contingent Resources Net Present Values Before Income Taxes Gross 2C Recoverable ( millions) Gross Number of Hz Resources per Location Interval…

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