INTRODUCTION Started Sept 2010, fourth Storm since Nov 1998 history of per share growth in prodn & asset value Market cap 600 MM (5.00/sh), TSX-V symbol SRX 120 MM shares + 7 MM options officer + director ownership 13% (16% FD) Q3/16…
PRODUCTION maintained 13,000 boe/d in 2016 with 6 new hzs; Dec/16 was 14,700 boe/d after turning on 2 more hzs prodn per share +33% annually last 3 years (Q4/13 to Q4/16) 3
CASH COSTS PER BOE focused on reducing costs in all price environments Q1-Q3/16 costs -20% vs 2015; expect 10% - 15% improvement in 2017 with longer-term processing agreement at Umbach transportation is excluded from…
FUNDS FLOW 2017 funds flow per share increases 100% vs 2016 with prodn growth, lower costs, fwd strip prices (Jan 6 AECO 2.78/GJ, Chicago US3.26/mmbtu, WTI US57/bbl, FX 1.32) funds flow per share flat since Q1/15 as decrease in…
COST OF RESERVE ADDITIONS all-in reflects total capital investment significant improvement in 2015 2015 3 Year PDP 6.53/boe 14.18/boe 1P 3.38 9.70 2P 0.50 7.82 2015 1P & 2P reflects FDC changes 6
MAJOR AREAS large shale gas resource in HRB, Umbach Montney needs higher nat gas price 109,000 net acres 13,130 Boe/d* growth from Montney development at Umbach (liquids rich nat gas) Horn River Basin 78,000 net acres 141 Boe/d*…
UMBACH AREA (NE British Columbia) 1% H2S requires sour gas plant Montney liquids rich gas (McMahon or Stoddart GPs) 155 net sections 109,000 net acres McMahon GP connected 1,200 1,300 btu/scf to 3 sales pipelines Q3/16 13,130 Boe/d…
PROCESSING ARRANGEMENT AT UMBACH Reviewed other alternatives; investing capital in drilling & completions with lower fee provides highest ROR Reduces op cost 15% - 20% Accelerating 2017 growth with increase in cash flow Total commitment…
UMBACH ACTIVITY field compression capacity increases to 115 mmcf/d from 80 mmcf/d raw in Jan/17 with 3rd facility start-up (Q4/16 68 mmcf/d raw) increase capacity to 150 mmcf/d raw by expanding 3rd facility for 7 MM 3rd…
UMBACH HZ COSTS accounting system costs drill cost incl pad & roads 2016 avg drill & compl 3.9 MM (cost per frac -23% vs 2015) reductions from pad drilling, mud system, improved logistics, lower service costs DRILLING hzs fracs length…
UMBACH LANDS DELINEATED TO DATE 33% of lands delineated 20% with 2P 6% with prod hzs Montney productive across the area; encouraging results on adjacent lands 17
PROCESSING & TRANSPORTATION Processing & transport support growth thru 2018 Firm processing 75 mmcf/d raw in 2017 (68 mmcf/d sales) 15 mmcf/d raw Stoddart, 60 mmcf/d raw McMahon ROFR to add up to 35 mmcf/d raw at McMahon Firm transport…
CHICAGO AECO PRICE DIFF Storm has 51 mmcf/d on Alliance to Chicago in 2017 (60% f/c prodn) WCSB prodn growth causing wider price diff to US markets pipelines to US fully contracted capacity available to Eastern Canada but, no demand…
AECO - BC STATION 2 DIFF continued BC prodn growth increasing Stn 2 price volatility & risk 20% of TCPL receipts from NE BC (growing) 20
HEDGING (Jan 3/17) Hedging to support growth; growth volumes not hedged target: 50% of prodn hedged 1 to 12 months forward 25% of prodn hedged 13 to 24 months forward may increase to 65% on short term basis Fixed price hedges 50%…
GUIDANCE 2017 Montney hz drill & compl 4.1 MM (+5% from 2016) guidance contingent on nat gas price; can reduce 2017 capex to 50 MM to maintain 16,500 boe/d 22
SUMMARY Montney at Umbach is large, liquids rich, high quality asset low sustaining capex with 6 new hzs in 2016 to offset decline continuing to improve hz rates/reserves (length, sand, frac spacing) lots of running room with…
STORM RESOURCES LTD. CONTACT INFO For further information please contact: Brian Lavergne, President and Chief Executive Officer Donald McLean, Chief Financial Officer Carol Knudsen, Manager Corporate Affairs Address: 200, 640 5th…
APPENDIX
NAT GAS PRICING USING 2017 FWD STRIP 2017 FWD STRIP (Jan 6/17) Sell in Chicago (Alliance pipeline) NYMEX US3.27/mmbtu NYMEX US3.27/mmbtu NYMEX - Chicago diff - US0.05/mmbtu NYMEX - Chicago diff -US0.05/mmbtu Chicago price Cdn4.03/GJ FX…
HORN RIVER BASIN HRB (NE BC) Shale gas from Muskwa, Otter Park, Evie shales 78,000 net acres, 100% WI 119 net sections Drilled 2 hzs & 2 verticals to validate commerciality 1 producing hz, 1 standing hz
US NAT GAS PRICE US supply/demand deficit increasing (declining prodn + imports, rising LNG & Mexico exports) Oct/16 prodn -3.6 Bcf/d YOY 2017 LNG exports est 1.5 Bcf/d vs YTD Oct/16 0.3 Bcf/d (Cheniere T1 & T2 running, T3…
MARCELLUS/UTICA SUPPLY GROWTH Marcellus/Utica growth is challenged by low netback 2016 YTD funds flow (2016 YTD 6/boe or netback less than 1/mcfe 2.50/boe excl hedges) (hedging added 0.51/mcfe) 10 public companies with 15 Bcf/d (+5%…
Loading...
