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Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc.

Cenovus Energy Inc. · Mar 29, 2017 · 29 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. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 1
    Transforming an oil sands leader March 29, 2017
  2. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 2
    A strategic and transformative transaction + 298,000 BOE/d Acquired from ConocoPhillips for 17.7 billion 50% Working Interest in FCCL 50% Working Interest in FCCL 178,000 bbls/d of oil sands production (net) 368,000 bbls/d of…
  3. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 3
    Transforming an oil sands leader Immediately accretive to per share metrics 2017F production volumes expected to increase 2018F adjusted funds flow per share MBOE/d by 18%, net of planned asset sales 947 1,000 708 expected to…
  4. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 4
    Anchor position in two high quality plays Consolidates ownership of top-tier oil sands ConocoPhillips projects (Horn River) no incremental staff or integration required low-risk growth profile with emerging technology upside…
  5. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 5
    Detailed transaction overview 298,000 BOE/d (70% liquids) based on 2017F estimates ConocoPhillips 50% interest in the FCCL Partnership (178,000 bbls/d 2017F) Majority of ConocoPhillips Deep Basin assets (120,000 BOE/d 2017F; 26%…
  6. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 6
    Transaction is fully funded Committed to strong credit ratings Transaction Transactionisisfully fullyfinanced funded Launching concurrent 3.0 billion common equity bought billions deal to fund a portion of purchase price 18.0…
  7. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 7
    A compelling three-year outlook Highly accretive to key financial and operational metrics Cenovus Cenovus pro forma impact (%) 2017F Accretion/ 2018F Accretion/ 2019F Accretion/ FORECAST FINANCIAL MEASURES 2017F (before (post (post…
  8. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 8
    Consolidating our interest in top-tier oil sands Acquiring remaining 50% interest in two top-tier Foster Creek 81-5W4 producing thermal oil sands projects with current 2017F production: 158,000 bbls/d production capacity of 390,000…
  9. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 9
    Largest & most efficient thermal portfolio Reinforcing our position as a leader in SAGD Production Portfolio-Weighted (Mbbls/d) December 2016 Average Production Portfolio-Weighted SOR SOR 400 5.0 4.5 4.3 4.3 4.0 300 4.0 3.2…
  10. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 10
    A demonstrated track record of execution Cenovus is the largest thermal oil sands producer A track record of successful execution Successfully executed 14 major capacity expansions Production capacity 26% CAGR in representing 390,000…
  11. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 11
    Technology innovation enhances value Focused innovation drives technological advancement Emerging technology drives incremental oil sands value Targeting oil sands sustaining capital costs of 7/bbl Illustrative potential NPV uplift…
  12. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 12
    Deep Basin provides second growth platform One of the largest Deep Basin land positions in the WCSB Three core operating areas: Elmworth-Wapiti, Kaybob-Edson, and Clearwater Low decline production base coupled with significant…
  13. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 13
    Over a decade of future drilling opportunities 1,500 potential drilling opportunities identified Focused on the Spirit River and Montney formations Initial development focused on the Spirit River and Future drilling opportunities by…
  14. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 14
    Maximizing value in the Deep Basin Taking a disciplined approach to development Internally funded growth potential Expect to run a three rig program in 2017 and ramping Deep Basin capital expenditures and operating margin ( millions)…
  15. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 15
    The new Cenovus ConocoPhillips One of the largest Canadian energy (Horn River) companies A leader in SAGD development and innovation Substantial inventory of regulatory approved oil sands projects Pelican Lake (21,000 bbls/d)…
  16. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 16
    Significant cash generation capacity Capital allocation priorities Free funds flow provides capital flexibility Financial resilience and safe, reliable operations Pro forma 2018F free funds flow before dividends ( millions)…
  17. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 17
    A compelling three-year outlook Increased scale and depth of portfolio Second growth platform provides capital flexibility Clear line of sight to production growth through steady Total Cenovus capital expenditures ( millions) capital…
  18. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 18
    Low cost structure drives margin improvement Cost reductions improving sustainability Meaningful cost reductions drive future performance Oil sands netbacks remain competitive /BOE Cenovus 2014A Cenovus 2017F 48% 32% estimated field…
  19. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 19
    Downstream assets provide integration Downstream integration helps to mitigate differentials Sufficient near term takeaway capacity Approximately 25% of total blended bitumen price exposure can be mitigated with heavy oil processing…
  20. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 20
    A strategic and transformative transaction ConocoPhillips (Horn River) Provides accretion on key metrics Enhances scale and capital flexibility Pelican Lake (21,000 bbls/d) Maintains financial resilience Oil sands (356,000…
  21. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 21
    Appendix
  22. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 22
    Christina Lake asset overview Asset overview Christina Lake area asset map One of the highest quality thermal oil sands projects in the industry 79-4W4 High average production per well and industry leading steam-oil ratio Christina…
  23. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 23
    Foster Creek asset overview Asset overview Foster Creek area asset map The first commercial steam-assisted gravity drainage project in the 73-3W4 industry High quality reservoir with a December 2016 steam-oil ratio of 2.4 Foster…
  24. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 24
    Narrows Lake asset overview Asset overview Narrows Lake area asset map Expected to be the first commercial steam-assisted gravity drainage 79-4W4 project to utilize solvents in the industry Solvent aided process is expected to reduce…
  25. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 25
    Elmworth-Wapiti asset overview Asset overview Elmworth-Wapiti area asset map 1.2 million net acres of land developed largely with vertical wells; acreage held by production with minimal expiries Prolific hydrocarbon stack producing…
  26. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 26
    Kaybob-Edson asset overview Asset overview Kaybob-Edson area asset map Asset anchored by Spirit River development and production in Kakwa and Edson Meaningful Montney and Duvernay potential with continued delineation activity by…
  27. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 27
    Clearwater asset overview Asset overview Clearwater area asset map Significant horizontal development potential across Spirit River, Cardium, and Glauconitic Meaningful offsetting industry activity in recent years despite limited…
  28. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 28
    Deep Basin infrastructure overview Asset overview Deep Basin infrastructure map 1.4 BCF/d of net natural gas processing capacity and significant associated gathering infrastructure Infrastructure footprint spans the Deep Basin…
  29. Acquisition Western Canadian Assets Presentation – Cenovus Energy Inc. – slide 29
    Supplemental terms of the transaction Contingent payment terms Vendor take-back terms Based on a 5-year time horizon, with a threshold price of ConocoPhillips has agreed to receive 208 million common 52.00/bbl Western Canadian Select…

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