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October 2018 Corporate Presentation – Bellatrix Exploration Ltd.

Bellatrix Exploration Ltd. · Oct 5, 2018 · 39 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. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 1
    Corporate Presentation OCTOBER 2018 1
  2. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 2
    Bellatrix Investment Highlights Dominant core acreage position in west central Alberta Top tier capital efficiencies and cost Spirit River represents one of North profile deliver full cycle profitability Americas lowest supply cost…
  3. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 3
    Corporate Profile MARKET SUMMARY Ticker Symbol TSX / NYSE: BXE Average Daily Volume1 Canada: 450,000/ U.S.: 85,000 Shares Outstanding2 61.8 million basic / 63.4 million diluted Market Capitalization3 94 million Bank Debt4 71 million…
  4. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 4
    2018 Outlook & Guidance 2018 CAPITAL GUIDANCE REDUCED BY 5MM NO CHANGE IN VOLUME GUIDANCE GIVEN STRONG RESULTS TO DATE CURRENT PREVIOUSLY SET 2018 BUDGET 2018 ANNUAL 2018 ANNUAL STRATEGIC OBJECTIVES GUIDANCE GUIDANCE (AUGUST 2,…
  5. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 5
    Strategic Objectives & Outlook Improving financial strength and value preservation in low commodity price environment 2017 2018 2019 New management team Manage capital Sustain operational levels established investment levels within…
  6. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 6
    Diversified Balance Sheet & Financial Flexibility Actively exploring refinancing opportunities and additional sources of liquidity BANK DEBT 71MM CREDIT FACILITY LONG TERM DEBT AT JUNE 30, 20181 FINANCIAL COVENANT1 MATURITIES1 3.5…
  7. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 7
    Debt Refinancing Transaction Closed STRENGTHENS LIQUIDITY AND INCREASES FINANCIAL FLEXIBILITY EXCHANGE NEW MONEY ADDITIONAL 2ND COMMITMENT LIEN CAPACITY Exchanged US80 million of Existing New money commitment of Senior Unsecured…
  8. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 8
    Commodity Price Risk Management NATURAL GAS FIXED PRICE SWAPS OIL FIXED PRICE SWAPS 60% 50% 2.89 % of total forecast 2018 oil & condi volumes 2.98 70.14 70.14 % of total forecast 2018 gas volumes 50% 40% 40% 30% 30%…
  9. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 9
    Hedging & Market Diversification Market Diversification Contracts Market Start Date End Date Volume Chicago 01-Feb-18 31-Oct-20 15,000 MMBtu/d Chicago 01-Nov-18 31-Oct-20 15,000 MMBtu/d Dawn 01-Feb-18 31-Oct-20 15,000 MMBtu/d Dawn…
  10. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 10
    AECO Natural Gas Demand Growth Drivers INTRA-ALBERTA DEMAND GROWTH External forecasts see intra-Alberta demand growth of: 500 MMcf/d YoY in 2018 to 5.3 Bcf/d 245 MMcf/d YoY in 2019 to 5.5 Bcf/d 190 MMcf/d YoY in 2020 to 5.7…
  11. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 11
    AECO Natural Gas Expansion Projects Underway ADDITIONAL EXPORT CAPACITY BEING DEVELOPED OUT OF THE CANADIAN BASIN Effective Capacity (MMcf/d) 2017A 2018E 2019E 2020E 2021E 2022E In Service Forecasts anticipate the basin will become…
  12. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 12
    Growing High Value Liquids Growing NGL Volumes & High Value Condensate 70 100% Product % of Total Crude Oil & 65 Condensate Volumes (bbl/d) Light oil 80% Corporate NGL yield 60 (bbl/MMcf) 55 60% 50 45 40% 40…
  13. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 13
    Torque to Both Oil & Natural Gas Prices H1/18 Production (boe/d) Sensitivity Analysis Adjusted Funds Oil, Based on Q2/18 Financial Flow condensate Oil & liquids Results (Annualized) & NGL account for 27% 27% of Change of US1/bbl…
  14. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 14
    Highly Concentrated Land Base DOMINANT ACREAGE POSITION WEST CENTRAL ALBERTA CORE AREA Highly focused land base in the prolific Deep Basin of FERRIER Alberta WILLESDEN GREEN 99% of total corporate GREATER PEMBINA production and…
  15. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 15
    North American Supply Cost Comparison 4.00 3.50 3.00 Henry Hub (US/MMbtu) 2.50 2.00 1.50 1.00 0.50 0.00 Economics assume 15% Before tax IRR, assumes US0.83 = CDN1.00, US0.75/MMbtu AECO basis, and a 20:1…
  16. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 16
    Bellatrixs Spirit River Play BXE Land Sections1 GREATER FERRIER AREA CORE SPIRIT RIVER PLAY 180 Gross 104 Net BXE Net Drilling Inventory2 102 proved 27 probable 225 unbooked 354 total True vertical formation depth 2,250 meters…
  17. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 17
    Spirit River Geology Summary Broad, thick, extensive sand rich valleys in SPIRIT RIVER STACKED SANDS Notikewin, Falher and Wilrich members One square Tight sandstone: long life reserves with mile section long term hyperbolic decline…
  18. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 18
    Comparing Premier Resource Plays Spirit River Montney Duvernay Tight Conventional Siltstone Shale Sandstone Porosity 6 to 18%; Porosity 0.6 to 8%; Porosity 2 to 8%; Permeability 1 to 3 mD Permeability 0.0001 to Permeability…
  19. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 19
    Low Cost Competitive Advantage BXE Spirit River Versus Canadian Plays STAGE COUNT PROPPANT PLACED 40 8,000 35 7,000 Average proppant (tonnes) Average stage count 30 6,000 25 5,000 20 4,000 15 3,000 TOTAL WELL COST…
  20. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 20
    Play Profitability Comparisons BXE Spirit River Montney Duvernay All-in Well Costs 3.4 6.4 9.4 (DCE&T, MM) Average IP365 1,070 608 459 (boe/d) IP365 Capital Efficiency 3,180 10,500 20,560 (/boe/d) Average Implied EUR 7.1…
  21. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 21
    Spirit River Type Curves Bellatrix Spirit River Economics SPIRIT RIVER 5.2 & 6.0 BCF TYPE CURVES 9 Economic Assumptions 5.2 Bcf 6.0 Bcf Gross CAPEX (DCE&T, MM) 3.4 3.4 Liquids (bbl/MMcf) Gross Natural Gas IP30 (MMcf/d) 6.6 6.3 8…
  22. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 22
    Spirit River All-In Profitability 5.2 Bcf Type Curve Full Cycle F&D costs C1.50/GJ C2.50/GJ Drill 1.5MM Complete 1.4MM Full cycle F&D costs /Mcfe (0.71) (0.71) Equip & tie in 0.5MM Half cycle costs 3.4MM Land/seismic/facilities…
  23. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 23
    Delivering on our Objectives 2018 RESULTS OUTPERFORMING EXPECTATIONS 14 12 Producing Day Volumes (MMCF/d) 10 8 6 4 2 0 0 30 60 90 120 150 180 210 240 270 300 330 360 390 420 450 480 510 540 570 600 630 660 690…
  24. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 24
    Enduring Efficiency Gains on Drill Times AVERAGE SPIRIT RIVER DRILLING CURVES DAYS SPUD TO RIG RELEASE BY YEAR 20 0 Days (Spud to Rig Release) 2014 Spirit River Average 500 15 2015 Spirit River Average 1,000 10 2016 Spirit…
  25. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 25
    Spirit River Well Costs & Capital Efficiencies FOCUSED CAPITAL COST REDUCTIONS 6.0 Long Reach Long Reach 5.0 4.0 Long Reach Costs (millions) Equip & Tie-in 3.0 Complete 2.0 Drill 1.0 0.0 2015 - 24 wells…
  26. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 26
    Bellatrix Focused Spirit River Growth SPIRIT RIVER PRODUCTION GROWTH 2010 2018 New Drill 80% Techniques Spirit 32,000 River 70% 28,000 Other Spirit River % of Total Company Volumes 60% Average Monthly Production…
  27. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 27
    Cost Reductions Achieved 29% REDUCTION IN PRODUCTION EXPENSES (/BOE) 11.00 Production expense 10.00 9.00 (/boe) 8.00 7.00 6.00 5.00 Q4/16 Q1/17 Q2/17 Q3/17 Q4/17 Q1/18 Q2/18 17% REDUCTION IN PRODUCTION EXPENSES…
  28. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 28
    Representative Spirit River Inventory Required to Maintain Production Volumes Approximately 15 net (5.2 Bcf type curve) Spirit River wells1 per year maintains production in the high 30 mboe/d range through 2022 Alternatively, 12 net…
  29. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 29
    Bellatrix Alder Flats Phase 2 PHASE 2 ON-STREAM MARCH 2018 Phase 2 brought on-stream safely, ahead of schedule, and approximately 5% under budget More than doubles throughput capacity at the plant to 230 MMcf/d (from 110 MMcf/d)…
  30. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 30
    Greater Ferrier Area Infrastructure Overview GREATER FERRIER EXISTING GREATER FERRIER AREA STRATEGIC INFRASTRUCTURE INFRASTRUCTURE ACCESS: Infrastructure gives Bellatrix control of production and growth Working interest or operatorship…
  31. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 31
    Material Facilities & Infrastructure Value MAJOR FACILITIES & INFRASTRUCTURE VALUE 190MM NET TO BXE 200 11MM 180 9MM 29MM 160 140 87MM 120 Estimated Value (MM) 100 80 60 40 55MM 20 0 BXE Alder Flats Plant Major…
  32. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 32
    Drill Bit Focused PLANT INVESTMENT PLANT PHASE & CONSTRUCTION 2 CONSTRUCTION COMPLETE COMPLETE MARCH 2018 Q2/18 Major compressor stations, pipelines and Bellatrix Alder Flats Plant capital investment nearing completion Proportion…
  33. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 33
    Ample Takeaway Capacity & Market Egress AMPLE FIRM TRANSPORTATION IN PLACE FOR ALBERTA NATURAL GAS MARKET EGRESS CURRENT & GROWTH VOLUMES Firm Transportation (FT) agreements in place for gross ALBERTA operated volumes at multiple…
  34. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 34
    Supplemental Information 35
  35. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 35
    Concentrated Multi-Zone Acreage DEEP BASIN MULTI-ZONE ACREAGE Deep Basin is highly coveted for: Sweet, liquids rich natural gas 4,600 ft TVD Belly River 6,200 ft TVD Sweet, light gravity crude oil Cardium Multi-zone hydrocarbon…
  36. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 36
    Cardium Light Oil Resource Play BXE Land Sections1 144 Gross BELLATRIX Activity Since Jan 2017 84 Net 3 Wells Drilled BXE Net Drilling Inventory2 97 proved 21 probable 95 unbooked 213 total Cardium Resource Play Summary…
  37. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 37
    Strategic Land Position GREATER FERRIER/BRAZEAU/WILLESDEN GREEN AREAS OF WEST CENTRAL ALBERTA Pembina Brazeau Ferrier Willesden Green Bellatrix Peyto TAQA Cenovus Tourmaline Westbrick Source: Accumap, company…
  38. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 38
    Last 18 Months in Review Debt reduction and maturity extension Over 1/3 of 2020 note maturities extended to 2023 Capital cost reductions 20% reduction in all-in well costs to under 3.4 million (drill, complete, equip and tie-in) from…
  39. October 2018 Corporate Presentation – Bellatrix Exploration Ltd. – slide 39
    Corporate Information BOARD OF DIRECTORS SENIOR OFFICERS BANKERS W.C. (Mickey) Dunn Brent A. Eshleman, P.Eng. National Bank of Canada Chairman President & CEO Alberta Treasury Branches The Bank of Nova Scotia Murray L. Cobbe Max Lof,…

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