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1Q 2018 Earnings Presentation – Painted Pony Energy Ltd.

Painted Pony Energy Ltd. · May 9, 2018 · 30 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. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 1
    Investor Update May 9, 2018
  2. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 2
    Why we do what we do... Billion Toe (tonnes of oil equivalent) We believe: world demand for clean and reliable source of energy is rapidly growing technological advancements makes our energy cost competitive on a world scale in…
  3. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 3
    Canadian Natural Gas Market Future Growth 6.0 2 Bcf/d of high confidence demand growth in the next 5 years; potential for 5.0 8+ Bcf/d of growth if LNG potential is realized Potential Canadian LNG Projects Increases in Canadian…
  4. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 4
    Proposed West Coast LNG Projects Game Changer T-North Enbridge Mainline Proposed LNG Projects Capacity Exxon Imperial AltaGas Ridley WCC LNG '4.0 Bcf/d Island Propane Export Terminal Shell & Partners - LNG Canada (FID expected…
  5. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 5
    Corporate Profile TSX: PONY 38% forecasted annual average daily production volume growth (2018 vs. 2017) Our 46% forecasted annual average daily liquids production growth (2018 vs. 2017) Growth 24% forecasted cash flow per share…
  6. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 6
    World Class Resource Montney Pure Play Asset The Montney is the most economic natural gas liquids play in Canada 314 net sections (201,009 net acres) of Montney lands 6.9 Tcfe (1,148 MMboe) Proved Plus Probable Reserves(1) with a…
  7. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 7
    Montney Pure Play Location, Location, Location Drilled first well at liquids-rich Beg 38 PONYs Montney Sweet Spot is: sections during Q1 2018 36 4x thicker than the Marcellus at greater than 300 meters sections (approximately…
  8. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 8
    The Sweet Spot PONY has best well in North Top Decile Well Performance Montney with 6-month average daily production rate 2,250,000 of more than 11 MMcf/d 47 of top 2,000,000 100 wells Based on are PONY cumulative wells volumes,…
  9. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 9
    Beg Test Well Significant Untapped Value in Liquids-Rich Block Jedney Beg Test Well Results 3 km Black Swan - Beg 20-H 2 Upper Montney wells Black Swan - Beg 80-G 5.5 MMcf/d 6.6 day production test 3 Upper Montney wells 7…
  10. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 10
    Processing & Transportation Firm Transportation & Processing Capacity Supports Production Jedney (13 MMcf/d) All current processing requirements in-place while West Blair firm transportation supports (25 MMcf/d) Beg market…
  11. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 11
    Production Profile Impressive Growth 80 70 PONY is expecting 38% annual average daily 60 production growth from 348-360 MMcfe/d 2017 to 2018 (58,000-60,000 boe/d) 2018 Production Volumes (m boe/d) 50 Annual Average Daily…
  12. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 12
    Historical Costs Drilling & Completions Efficiency As capital well costs fell, production type curves dramatically improved Management Perf & Plug Systems Type Curve Continued type curve 21 wells increased 50% D&C cost 7.7 million…
  13. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 13
    Single Well Economics by Area 2018 Management Type Curves Management Type Curves Capital Costs Single Well Economics IRR NPV10 Daiber (dry) Drilling 1.9 million Daiber Blair (lean) 54% 4.7 mm (dry) Completions 2.1 million…
  14. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 14
    Single Well Development Economics Price Sensitivity (Half Cycle) Townsend (liquids-rich) Blair (lean) Daiber (dry) 120% Liquids-enhanced, Blair 100% wells provide exposure to stronger Condensate, NGL Rate of Return (BT) and…
  15. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 15
    Canadian Natural Gas Reserves Assuming Enterprise Value As at Dec 31, 2017 4.85/sh PONYs Proved plus Probable (2.67/sh equity + 2.17/sh debt) natural gas reserves of 6.5 Tcf on 6.9 Tcfe of 2P Reserves 12 (excludes liquids) positions…
  16. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 16
    Reserve Information As at Dec 31, 2017 6.9 Tcfe of Proved Plus Proved Plus Probable Probable reserves with an 8.0 6.9 7.0 PONY Reserve Growth Total Proved NPV10 of 3.3 billion* 6.0 4.9 (20.53/share) 5.0 4.6 Tcfe 4.0 2.9…
  17. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 17
    Recycle Ratios Low Cost Reserve Additions in 2017 1.6x Proved Developed Producing 2017 F&D 4.0x Recycle Ratio 3.2x 2017 Recycle Ratios 3.0x 2.0x 1.8x 1.9x 1.6x 1.6x 1.3x 1.1x 1.0x 0.0x Proved Developed Producing…
  18. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 18
    2018 Sustainable Capital Spending Cash Flow Budget Annual400 Average Daily Production(forecast) Annual Average Daily Production(actual) 2018 capital 350 Capital Development Program development program 400 Cash Flow(actuals) 348 360…
  19. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 19
    2018 Corporate Cash Flow Sensitivity Cash Flow Budget 1.50 Cash Flow (including hedges) Cash Flow (excluding hedges) 1.25 Cash Flow (/Mcfe) 1.00 Physical and financial fixed 0.75 price hedges provide significant…
  20. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 20
    Solid Margins Drive Earnings Cost Efficiencies Drive Higher Cash Flow per Mcfe Top Line Revenue (including Hedging) 1.50 Pre-Tax 3.50 3.32 /Mcfe Earnings Hedging Gain 0.21 1.00 0.20 3.00 PONY can deliver earnings 1.16/Mcfe Cash…
  21. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 21
    Return on Average Capital Employed (ROACE) Illustrates Operational Sustainability 25% 25% 20% 2017 US ROACE 20% 2017 Canadian ROACE 15% 15% 11% 10% 10% 5% 5% 0% 0% Average Canada -5% Average US -5% -10% 4.2% -10% 4.3%…
  22. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 22
    Market Diversification Natural Gas Sales Points BRITISH COLUMBIA AECO AECO Station 175 MMcf/d 2 2018 Average Medicine Sumas Hat SUMAS DAWN 30 MMcf/d Malin 43 MMcf/d (Current) 2018 Average Enbridge 73 MMcf/d (Nov…
  23. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 23
    2018 Production Revenue Managing Volatility 65% of PONYs Q2 Q4 2018 NYMEX production volumes are protected 9% NGL & through a combination of physical and nsate Condenst 5% financial contracts at a volume- weighted average…
  24. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 24
    69.60 SUMAS AECO FP 100% 71.88 bbl 71.22 300 3.27 8,000 bbl Basis 71.88 bbl NYMEX Basis 12% PercentageForecast ProductionHedged bbl 98% 17% 94% 93% 5% St 2 FP 2.7 15% 88% 250 Natural Gas Volume Hedged (Mcf)…
  25. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 25
    Pony Points Checking Off All of the Boxes Massive reserves base Top well performance with increasing liquids cut Low well costs Firm transportation to diverse pricing hubs Attractive relative valuation Well situated to…
  26. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 26
    Appendices and Advisories
  27. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 27
    Diversified Market Exposure 2018 / 2019 Sales Contracts Support Strong Netbacks Index pricing as of May 1, 2018; All currency CAD Painted Pony Painted Ponyactively activelym s markets the majority the majority of natura ofg…
  28. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 28
    Financial Strength Term Debt and Credit Facility Provide Flexibility 400 Million Syndicated Credit Facility Syndicated Credit Secured, Reserve Based Lending Facility 164 Matures May 2020 196 164 million drawn as at March 31, 2018…
  29. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 29
    Corporate Overview Auditor KPMG LLP Evaluation Engineers GLJ Petroleum Consultants Ltd. Banks The Toronto-Dominion Bank The Bank of Nova Scotia Alberta Treasury Branches Canadian Imperial Bank of Commerce Royal Bank of Canada…
  30. 1Q 2018 Earnings Presentation – Painted Pony Energy Ltd. – slide 30
    Advisory (b) Undeveloped reserves are those reserves expected to be recovered from known accumulations where a significant expenditure (for example, when compared to the cost of drilling a well) is required to render them capable of…

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