C O R P O R AT E P R E S E N TAT I O N A U G U S T 2 0 1 6 BOLD IDEAS FOR ENERGY 1
Perpetual Energy Inc. Common shares o/s 52.5 million Management ownership 49% Share price(1) 2.08 Market capitalization 110 million Total net debt (2) 27.7 million Net bank debt (2) 9.9 million Financing arrangement (3)…
Diversified portfolio for value creation SHALLOW LIQUIDS- HEAVY OIL BITUMEN OTHER GAS RICH GAS Eastern Edson Wilrich Mannville Panny Warwick Gas Alberta Greater Edson Mannville EOR Bluesky Storage Conventional Multi-zone Heavy…
Operating profile Conventional shallow gas Mannville heavy oil Eastern Alberta Bitumen Viking/Colorado shallow shale gas Edson Wilrich Deep Basin Multi-zone liquids-rich gas Tight oil & gas exploration Production (1) 15,959…
Portfolio management strategy 2016 CASH FLOW GENERATORS Maximize Cash & Preserve Value Conventional shallow gas Mannville heavy oil PROVEN MEDIUM AND DIVERSIFYING LONG TERM GROWTH STRATEGIES VALUE STRATEGIES Re-invest to…
2016 Top four strategic priorities 1. Reduce debt & restore cash flow 2. Grow value & scope of Greater Edson liquids-rich gas 3. Maximize value potential of Eastern Alberta assets 4. Advance high impact opportunities Strategic…
KEY PRIORITY 1 REDUCE DEBT AND RESTORE CASH FLOW
Debt reduction 2015 Asset Transactions West Edson swap 258 million 6.75 million TOU shares Closed April 2015; MTM 38.50/share = 258 million Sold 0.5 million for 16 million proceeds in Q4 2015 & Q1 2016 Fee Simple land sale 21…
West Edson transaction summary Swap of West Edson property for 6.75 million Tourmaline Shares 24 MMboe of reserves 7.2 MMboe (29%) proved and probable developed producing 16.8 MMboe undeveloped reserves requiring 124.5 million of…
Recapitalization transactions April 2015 May 2016 Swap West Edson for TOU Shares - April 2015 6.75 million TOU shares 38.50/share = 258 million New Financing 1 million TOU shares pledged to secure 21.3 million loan due Arrangement -…
Post-Recapitalization balance sheet Cash net of working capital: 5 million 15 million in cash net of 10 million working capital deficiency Secured Debt: 31.6 million Reserves-based loan Undrawn on 6 million capacity Reduced from 20…
2015/2016 Capital spending 2015 2016 2016 2016 Activity Capital Q2 Q3 Q3-Q4 Total West Central 6 gross (4.5 net) wells 67.5 MM 5.3 MM 2.4 MM 7.7 MM Liquids-Rich Gas West Wolf Facility Waterflood Mannville Heavy Oil 1.4 MM…
KEY PRIORITY 2 GROW VALUE AND SCOPE OF GREATER EDSON LIQUIDS-RICH GAS
Edson Wilrich Liquidsrich gas PERPETUAL To Rosevear Plant (15% WI) Pipeline To Edson Deep Cut Plant 16-10 Compressor Capacity 30 MMcf/d West Wolf Lake 10-3 Gas Plant Capacity 45 MMcf/d Pre-2014 Drill 2014 Drill…
East Edson type curves Projected Economics per SW Drilling Location Capital (D,C & T) 4.8 MM NPV 10 % 2.4 MM McDaniel SW Type Curve McDaniel NE Type Curve ROR 33% BT F&D 8.50 / boe Capital Efficiency 9,000 boe/d Payout 2.6…
Greater Edson liquids-rich gas play performance 40% net production growth in 2014 14,000 16,000 Driven by West Edson expansion from 15 to 30 MMcf/d net Ramp up to fill existing East Edson facilities with JV drilling 12,000 14,000…
KEY PRIORITY 3 MAXIMIZE VALUE OF EASTERN ALBERTA ASSETS
Eastern Alberta Conventional heavy oil Mannville 8 Producing Mannville pools * 6 Lloyd, 1 Sparky, 1 Basal Quartz 136 MMbbl Original Oil in Place 6 MMbbl 5% recovery factor Current Production 1,100 bbl/d Low cost HZ development 1 -…
Mannville heavy oil value potential Projected Economics Per Well Assumptions Lloyd Sparky (McDaniel Year End 2013) Capital (D,C & T) 1.2 MM 1.2 MM 68.90/bbl Wellhead heavy price 2014 Pricing WTI US95/bbl, WCS US23.5/bbl, offset…
Waterflood and enhanced oil recovery Mannville I2I Waterflood Pool Working Interest 66.7% OOIP: 38 MMbbl Sparky Mid Type Log 100/09-32-050-08W4/00 Cum Prodn + McDaniel P+P: 1.5 MMbbl (4% recovery factor) technical recovery 19…
Early waterflood response NE portion Mannville B Pool - Lower Channel Sand 200 Oil Rate Water Injection Start Oil Base Forecast 160 McDaniel YE2015 Internal Forecast Oil Rate, bbl/d 120 Internal Forecast McDaniel YE 2015…
Waterflood and enhanced oil recovery scope Select Pools OOIP Cumulative P+P Implied Expected Potential with production Reserves Recovery Primary Secondary Recovery to YE 2015 booked at Factor Recovery and EOR YE 2015 (5-8%)…
Conventional shallow gas Legacy asset base characteristics Northeast and East Central Alberta Cretaceous and Devonian sweet shallow gas < 800m Current production 50 MMcf/d Base declines < 10-15% Belly River Multiple stacked zones…
Viking/Colorado shallow shale gas 130 TCF Resource In Place Belly River Play Fairway OGIP estimated average 16 Bcf/section Cardium/ Colorado Wells Perpetual Lands 200-300m gas saturated shale section Historical Viking Reserves 6…
KEY PRIORITY 4 ADVANCE HIGH IMPACT OPPORTUNITIES
Waskahigan Duvernay volatile oil play Richer/Volatile Oils 13-1 Cum to date 84 MSTB Oil (17 months) Leaner/Gas 16-36 Condensates AOC Farm-in: Drilled & completed 16-36-63-25W5 PMT retains 35% in 6 sections & 100% in 3.75…
Bitumen Panny Sunshine Brion 396 net sections Perpetual Harper Sunshine Dover Prosper (253,000 net acres) Panny Legend Lake Rigel of oil sand leases Sunshine LEAD Pilot Athabasca Oil West Ells Dover West Carb Pilot Ells…
Bitumen Panny Bluesky Low rate cold flow without solvent or thermal assistance Average pay thickness 11 m Low viscosity bitumen 15,000 cp at 25oC 50,000 cp at 11oC reservoir temp Highly mobile at 70oC Panny Bluesky Resource…
LEAD process technology pilot Low pressure electro-thermally assisted drive First stage of pilot single well Cyclic Heat Stimulation currently operating Electrical resistive heating and production in a single horizontal well to…
INVESTMENT THESIS EXTREME VALUE DISCOUNT TO ASSET VALUE LEVERAGED TO GAS PRICE RECOVERY AND BEST IN CLASS GAS E&P (TOU)
Sum of the parts (1) 1.89 million TOU shares 30.32/share (2)(3) Includes appreciation of TOU shares based on 12 month TOU consensus target price of 36.33/share Trading materially below reserve-based net asset value 33
Key investment highlights High Quality Assets Asset base repositioning for resource-style and diversification successful Edson Wilrich liquids-rich gas inventory well-defined Mannville heavy oil delivering diversified cash flow with…
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