Corporate Presentation September 2016 2016 Energy Conference
Growth focused junior oil company with a low cost, low risk, diversified asset base, strong balance sheet and a deep inventory of economic future drilling opportunities Pro-forma estimates 6,000 boe/d Approximate June production 85%…
The new diversified Gear Energy Focus on low risk, low cost, heavy and light oil horizontal resource oriented plays Other GXE 200 boe/d Elk Point 225 boe/d Edmonton Celtic/Paradise 700 boe/d Morgan Drayton Valley Vermilion…
Gear development capital investment in 2016 is forecast to improve upon the exceptional results from 2015 2015 total capital efficiency of 13,500 was a 60% improvement over the previous four year average 5 year history of trailing 12…
Risk management program target of 50% protection WTI Risk Management (volumes net of royalties) 2016 H2 2,000 bbl/d 67.13 CAD Swap (Average) Target floors of 60.00/bbl CAD WTI and 2.00/mcf CAD 2017 H1 900 bbl/d 61.39 CAD Swap…
Current Oil Futures for 2017 WTI US 51/bbl WTI CAD 66/bbl Resulting in 2017 estimates of: 40.70/boe Revenue. Based on 60% heavy oil, 25% light oil and 15% gas 18.65/boe Cash Flow. Assuming 10% royalties and 18.00/boe of total…
Organic production growth is expected to resume in Q3 2016 with the 14 well oil drilling program The current strategy for 2017 is to reinvest cash flow, targeting approximately 10% production growth Detailed 2017 budget is expected…
Costs per unit have continued to improve despite production declining since 2014 2016 H2 Guidance 14.00 - 16.00/boe Record low costs Q2 2016 13.44/boe 2016 H2 Guidance 2.50/boe w/o transaction costs Q2 2016 3.28/boe…
Gear resumed drilling operations in June 2016 and increased the planned program from 12 to 14 wells in September Program Highlights Wildmere Three quad lateral unlined horizontals to follow up on the successful quad lateral well…
7% of Gear Q2 production Three quad-lateral unlined horizontal wells drilled in 2016 4% Royalty with initial rates averaging 160 bbl/d per well, 8.95/boe Op costs approximately 40% better than the first well drilled in 2015 (and the…
9% of Gear Q2 production The original 2016 six well program was expanded to 4% Royalty 6.30/boe Op costs eight wells due to drilling cost savings of 21% McLaren Sands Seven of the eight planned wells are now complete with three on…
McLaren A McLaren A & B McLaren B 6.5 Sections undeveloped land Two overlapped sandstones 3m per zone Current estimate of horizontal drilling inventory is limited to land with historical proven vertical production 2016…
Two successful half section producing horizontal wells in the regional Basal Belly River formation Basal Belly River average pay of 5m with 38 API light oil Future development to focus on full section Basal wells with larger stimulation…
560 boe/d June estimate Gear plans to follow up historical Belly River 77% light oil & Liquids 7.5% Royalties success with two Basal wells in Q4 2016. Four 16.80/boe Op costs potential Gear wells are being surveyed as full section…
Over 20 undeveloped sections of crown land were acquired through 2015 for approximately 1 million Another 5 sections of lands have been added to date in 2016 for 100k Gear is targeting material future potential horizontal drilling…
Gears four year history of successfully growing value per debt adjusted share was impacted by oil prices With recent cost compression and price stability, the strategy is to resume growth per DA share in 2017 Cash flow metric shown…
Executive Experience (prior) Ingram Gillmore VP Engineering - ARC Energy Trust, Talisman President & CEO, Director Yvan Chretien VP Land - ARC Energy Trust, CNRL VP Land Bryan Dozzi Engineering Manager - Gear Energy, Rock Energy VP…
Analysts Altacorp Thomas Matthews Cormark Garett Ursu Desjardins Jamie Kubik FirstEnergy Bob Fitzmartyn Haywood Darrell Bishop Peters and Co Dale Lewko 18
Price forecasts are US50 flat WTI with 0.80 CAD/US foreign exchange, or US45 flat WTI with 0.775 CAD/US exchange, a heavy oil differential of 30% off WTI with an additional heavy oil quality discount of CAD4.50, and a light oil realized…
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