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FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc

Perpetual Energy Inc · Nov 14, 2017 · 42 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. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 1
    ENERGY GROWTH CONFERENCE NOVEMBER 2017 BOLD IDEAS FOR ENERGY 1
  2. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 2
    Financial Profile Financial Profile Common Shares o/s (1) 59.3 million Management ownership 47% Share price (1) 1.20 Market capitalization 71 million Net bank debt (2) 39 million TOU share-based loan (3) 19 million Term Loan…
  3. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 3
    Operating Profile Edson Wilrich Deep Basin Multi-zone liquids-rich gas Tight oil & gas exploration Mannville heavy oil Eastern Alberta Conventional shallow gas Viking shallow shale gas Bitumen Asset Summary Production…
  4. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 4
    High Graded Asset Base 100% 100% Building a foundation 90% of resource-style plays 90% Robust multi-zone inventory 80% for profitable exploration 80% and development Proved and Probable Reserves (% of Total) 70% High working…
  5. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 5
    Diversified Portfolio for Value Creation Edson Wilrich Mannville & Panny Greater Edson secondary conventional shallow gas zones Mannville Viking shallow Columbia/Brazeau shale gas Tight conventional Deep Basin & Wilrich…
  6. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 6
    2018 Strategic Priorities Grow Value of Greater Edson Liquids-Rich Gas Grow Value of Eastern Alberta Portfolio Advance High Impact Opportunities Optimize Balance Sheet For Growth Positioned to pursue profitable growth…
  7. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 7
    2017 Capital Spending 2017 2017 Q4 2017E H1 2018 H2 2018 2018E Q3 YTD Forecast Total Forecast Forecast Total ( millions) West Central 46 18 64 8 21 29 11 gross 4 gross 15 gross 0 drills 4 gross (4.0 net) 4 gross (4.0 net)…
  8. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 8
    Line of Sight Growth Plan 16,000 Forecast Production 2018 Avg 13,000 boepd Average Daily Production (Boe/d) 14,000 12,000 2017 Avg 9,900 boepd 10,000 8,000 6,000 4,000 2,000 - Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4…
  9. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 9
    Increasing Margins 35.00 35.0 30.00 30.0 Margins despite Increasing lower forward strip 25.00 25.0 commodity prices in 2018 20.00 20.0 /Boe /Boe 15.00 15.0 10.00 10.0 5.00 5.0 - - 2012 2013 2014 2015 2016 2017E…
  10. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 10
    STRATEGIC PRIORITY 1 GROW VALUE OF GREATER EDSON LIQUIDS-RICH GAS
  11. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 11
    Greater Edson Liquids-Rich Gas Wilrich Play Performance 14,000 25,000 2014: East Edson JV Royalty deal Sold 5.6 MMcf/d plus associated liquids for 120 MM investment 2015: Growth driven by JV Royalty sale commitments 12,000…
  12. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 12
    Edson Activity Installing additional 15MMcf/d capacity at West Wolf 10-3 plant to bring area capacity to 78 MMcf/d in Q1 2018 Currently drilling 2-5, target 3,400m horizontal length Pre 2017 2017 (Drilled to Date) 2017…
  13. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 13
    Edson Type Curves Well defined type curve provides reliable forecasts with 2017 average results to date slightly above type curve ERH expected to increase rate & reserves per well Projected Economics per 1,700 m Lateral…
  14. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 14
    East Edson Wilrich Capital Efficiency 10.0 Capital Costs 6,000 Capital Efficiency 20,000 Average Total Drilling/Completion/E&T Cost (Millions) Average Well Capital Cost Per Horizontal Length 9.0 18,000 Capital…
  15. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 15
    Top Quartile Operating Cost Structure East Edson Operating Costs 2,500 14.00 12.00 2,000 10.00 Operating Cost (/Boe) Operating Cost (M) 1,500 8.00 6.00 1,000 4.00 500 2.00 0 0.00 Operating Costs…
  16. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 16
    Greater Edson Production Growth East Edson JV East Edson New Greater Edson Daily Production 90,000 spending ramp up Plant start-up TCPL firm West Edson Decision to defer Additional compression transportation Swap for capital…
  17. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 17
    STRATEGIC PRIORITY 2 GROW VALUE OF EASTERN ALBERTA PORTFOLIO
  18. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 18
    Eastern Alberta Mannville 8 Producing Mannville pools 6 Lloyd, 2 Sparky Current production 1,000 boe/d New Drill Injector Conversion New Pipeline Facility Upgrade/Set up Disposal Well Access to Large Resource 2017…
  19. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 19
    Mannville Heavy Oil Drilling Inventory Well Economics Assumptions Capital (D,C & T) 0.8 MM 2017 Pricing CA44.70/bbl wellhead heavy price (McDaniel July 2017 WTI US50.00/bbl, WCS CA48.70/bbl, Offset CA-4.00/bbl forecast) NPV 10 %…
  20. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 20
    Mannville Heavy Oil Pools Waterflood Response 800 Upper Mannville I2I Pool 600 Waterflood Wedge Volumes F&D Recycle Ratio from Capital Spent To-Date Oil Rate, bbl/d; 400 McDaniel PPDP and TPP To-date To-date Capital…
  21. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 21
    Waterflood and Enhanced Oil Recovery Scope Select Pools OOIP Cumulative P+P Implied Internal Potential Remaining Currently Under production Reserves Recovery Remaining with Improved Waterflood to YE 2016 booked at Factor Recoverable…
  22. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 22
    STRATEGIC PRIORITY 3 ADVANCE HIGH IMPACT OPPORTUNITIES
  23. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 23
    Bitumen Panny Bluesky Low rate cold flow possible 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…
  24. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 24
    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…
  25. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 25
    Viking Shallow Shale Gas Resource in Place OGIP estimated average 4 Bcf/section Horizontal Viking Gas 300 BCF Resource In Place Inventory Perpetual Viking Hz Well 165 BCF potential recoverable resource Type curves developed from…
  26. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 26
    STRATEGIC PRIORITY 4 OPTIMIZE BALANCE SHEET FOR GROWTH
  27. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 27
    Balance Sheet Net bank debt: 39 million(1) Credit facility borrowing limit expanded by 62.5% to 65 million; Term extended until May 2019 Strong growth in funds flow and PDP value at current strip pricing to support expanding credit…
  28. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 28
    Debt Repayment & Liquidity Profile Forecast Debt Repayment Profile 12/31/2017 50% 80 45% 42% 45% 70 62.9 MM 40% 60 35% 50 41.2 MM 30% 25% 40 20% 30 13% 15% 20 18.7 MM 10% 10 5% 0% 0 < 1…
  29. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 29
    Improving Balance Sheet 450 10 400 9 8 350 Debt to Adjust Funds Flow (X) 7 300 6 Debt (MM) 250 5 200 4 150 3 100 2 50 1 0 - 2012 2013 2014 2015 2016 2017E 2018E Debt Total Net Debt to Adjusted Funds…
  30. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 30
    Natural Gas Market Diversification Strategy 2018 Price Exposure Net of Royalties Crude Oil NGL - Other 9% Market shift to diversify portfolio NGL - 2% Condensate AECO Locked in term spreads and swapped back to Daily Index at each…
  31. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 31
    INVESTMENT THESIS POTENTIAL FOR MULTIPLE EXPANSION RELATIVE TO PEER GROUP COMPELLING DISCOUNT TO NET ASSET VALUE TORQUE TO GAS PRICE RECOVERY
  32. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 32
    Share Price Performance Last Year of Trading (Post Shallow Gas Disposition) 130.00 120.00 110.00 100.00 90.00 80.00 70.00 60.00 50.00 PMT TOU Peer Group 2017 EV/Debt 2018 EV/Debt 2018 Adjusted Funds Adjusted…
  33. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 33
    Sum of the Parts (1) Year-end 2016 reserves based on McDaniel reserves and pricing, adjusted for 1.67 MM TOU shares 28/share and Q1 equity issuance (2) Undeveloped land replaced with risk-discounted prospect inventory; Includes…
  34. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 34
    Torque to Gas Price Recovery 0.50/GJ in 2018 gas price 12 million increase in adjusted funds flow (incremental 0.20 per share) 30% increase in 2018 funds flow (1) 10% reduction in year end 2018 debt Combines to drive TTM Net…
  35. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 35
    Key Investment Highlights High Quality Assets Asset base repositioning for resource-style and diversification successful Edson Wilrich liquids-rich gas inventory well-defined providing high capital efficiency growth Mannville heavy…
  36. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 36
    ADDITIONAL INFORMATION Sue Riddell Rose President & CEO Mark Schweitzer VP Finance and CFO Lorenzo Chiarastella Investor Relations infoperpetualenergy.com EMAIL 800.811.5522 TOLL FREE 403.269.4400 PHONE 403.269.4444 FAX 3200,…
  37. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 37
    APPENDIX
  38. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 38
    2018 Projected Funds Flow Projected 2018 2018 AECO (Cdn/GJ) Funds Flow (1) ( millions) 1.75 2.00 2.25 2.50 2.75 3.00 47.50 26 32 37 43 49 55 WTI (US/Bbl) 50.00 28 33 39 45 51 56 52.50 29 35 41 47 52 58 55.00 31 37 43 48…
  39. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 39
    Transformational Transactions Warwick Gas Storage Sale: (May 2016) Sold remaining 30% partnership interest (23 million) Senior Notes Swap: (May 2016) Positive Impact: Retired Senior Notes via swap for 4.4 MM TOU shares (214 million)…
  40. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 40
    Shallow Gas Disposition October 1, 2016 Nominal proceeds + 2 year call option Deferred Purchase Price through 2 year call on AECO gas price 2.81/GJ for 33,611 GJ/d Metrics Impact Production: (35.5 MMcfe/d) Funds Flow: 5 - 10…
  41. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 41
    Conventional Shallow Gas Belly River Conventional shallow gas asset base characteristics Primarily Mannville Area remaining post shallow gas disposition Viking Cretaceous sweet shallow…
  42. FirstEnergy 2017 Energy Growth Conference – Perpetual Energy Inc – slide 42
    Bitumen R9 R5 R1W5 R21 R17 R13W4 T98 Perpetual OS Leases Overriding Royalty Lands Perpetual Panny Pilot T95 Experimental Primary Projects Thermal Projects 301 net sections (192,416 net acres) of oil sand leases…

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