PrairieSky Royalty Snapshot 5.9 Positive TSX Working capital PSK Billion Enterprise Value(1) No Debt Annual Dividend 235.2 50 0.78 Million Million Per Common Share Shares Outstanding NCIB 7.8 NW NE 7.6 4 Million SW SE…
Introduction to PrairieSky Royalty NW NE 7.8 million acres of Fee Lands(1) Business model supports dividend payments SW SE 7.6 million acres of GORR lands(1) Operating margin(2) of 98% Lands located throughout the heart of the…
A Unique and Diversified Approach to Investing in Oil & Gas Third Party Operators 340 lessees paying royalties on PrairieSky Royalty lands Operators on PrairieSky Royalty Fee Lands include Majors, Independents, Mid Cap and…
Royalty Advantage Ownership in PrairieSky provides a long duration cash flow stream and the optionality associated with perpetual land title ownership. Exposure to: No exposure to: High margin cash flow streams Capital costs New…
Higher Margin, Lower Risk Margin Summary (/boe) Illustrative Working Interest Operator PrairieSky Royalty Revenue (50% Liquids Production)(1) 33.57/boe PrairieSky Royalty offers higher margins Production & Mineral Tax than…
Recycling the Land Base The perpetual nature of Fee Lands allows PrairieSky Royalty to continually recycle lands and grow its revenue base. PrairieSky leases At the end of the primary lease lands by zone same term, any lands/rights…
Production History on our Fee Lands Cumulative production of Historical Gross Production on PSK Fee Lands 4.3 billion boe 300,000 250,000 200,000 150,000 100,000 50,000 - CD Avg. Oil (bbl/d) CD Avg. Gas…
PrairieSky Royalty Per Share Metrics Production per Million Shares Acres per Million Shares(1) 140 80,000 120 60,000 100 80 40,000 60 20,000 40 20 - IPO Today 0 (1)Acres per share based on number of common shares…
Revenues Generated from Royalty Properties PrairieSky generates revenues through Royalty Compliance analysis focuses on leasing its Fee Lands and its GORR capturing mispaid royalties through Interests, which includes Royalty…
Revenues Generated from Royalty Properties Oil and NGL royalty production revenue Liquids revenue CAGR of has continued to grow from 2015 with 40% from 2015 to 2017. production additions (organic and acquisitions) and…
Total Shareholder Return Since IPO From IPO to June 30, 2018, PrairieSky has Total shareholder return from IPO returned 758 million in dividends and 92 to July 20, 2018 is 4%. million in share buybacks to shareholders WTI down…
Underlying Commodity Exposure without Liabilities PrairieSky provides unlevered, unhedged exposure to the underlying commodity without operational risk and working interest liabilities Pure royalty company, Franco Nevada, aligned…
Capital-Free Returns and Diversification PrairieSky Royalty E&Ps Midstream Capital-Free Returns No capital investment required x Requires significant capital x Requires significant capital or acquisitions for growth for growth…
Shareholder Alignment Board & Management invested 80 million in PSK Shares Shareholder All staff are shareholders Pay for performance long-term incentives Alignment and maximize participation in Employee Stock Purchase…
HIGH QUALITY ROYALTIES = OPTIONALITY
Future Potential Optionality Crown Royalties Optionality Beyond Current Valuation Expansion of productive trends Material new pool discoveries Improvements in drilling and completions technologies: incremental recovery via…
Multi-Zone Potential Exploration and development has taken place since the 1950s in the form of new pool discoveries as well as through redevelopment with evolving technology 1950s Future Homeglen Rimbey Duvernay, Banff Leduc Oil…
Saskatchewan Viking Continues to Attract Capital Saskatchewan Viking remains a key play for many producers based on superior economics, short cycle times and low capital requirements < 1 million to bring well on-stream and…
Development of an Economic Resource Play Saskatchewan Viking Wells Drilled Before 2010 2,650 vertical wells drilled (in this map area) 36 horizontal wells drilled Horizontal lateral length 1 mile or 0.5 mile PrairieSky Drilling…
Alberta Viking Growth in Activity Production on PrairieSky Lands 12,000 10,000 8,000 Gross bbl/d 6,000 4,000 2,000 0 2014 2015 2016 2017 2018 pre-2014 Oil (bbl/day) 2014 Oil (bbl/day) 2015 Oil (bbl/day) 2016 Oil…
Central Alberta Duvernay Over 1 million acres of royalty lands in an emerging shale resource play. Pembina / Thorsby Crown land sales totaled Potential for 180 miles 309.9 million in 2017 and significant royalty…
Investing in Future Growth Opportunities PrairieSky has re-invested its cash lease bonus consideration into new emerging oil NW NE 720,000 resource play opportunities to provide SW SE acres of 15 year oil sands leases liquids…
Upper Montney Light Oil Exposure GORR on 70 sections of prospective Upper Montney light oil lands in Two Rivers region of British Columbia PrairieSky will benefit from future development of play without capital expenditures,…
Enhanced Oil Recovery Unit on single section of land first started producing in 1979 Production has increased dramatically with EOR scheme, delivering over 60,000 per month in royalty revenue in 2018 0 1 Mile 1,600 Gross…
Multi-Zoned, Prolific Spirit River Exposure Gross HZ Spirit River Royalty Production on GORR Lands 35,000 30,000 Gross Production (boe/d) 25,000 20,000 15,000 10,000 5,000 0 2010 2011 2012 2013 2014 2015 2016…
Legacy Production Unit was discovered in 1956 and developed vertically until 1965 Placed under a partial waterflood in 2003 Operator has an inventory of 166 net wells, 93 are booked locations First horizontal well drilled in…
Technology NW NE Unit started producing in the 1950s. SW SE Horizontal, multi-stage fracture development started in 2012 increasing production to levels not seen since the 1960s. Increased horizontal drilling activity on a…
New Pool Discovery and Development The pool encompasses 32 sections of Fee Land, currently under natural gas flood Production began in early 2012 and reached peak production of over 4,000 bbls/d 100 million in royalty…
10 Year Free Cash Flow Generation 2018 YTD free cash flow 2018 YTD royalty production 114.2 million 23,232 boe/d 10 Year Average Annual Production (boe/d) FX AECO WTI (US / 22,000 26,000 28,000 30,000 32,000 (/Mcf) (/bbl)…
Why PrairieSky 7.8 million acres of Fee Simple lands Vast Land Base 7.6 million acres of GORRs Management and directors with an unparalleled understanding of the Experienced Team royalty business and are invested alongside…
APPENDICES
UNDERSTANDING ROYALTIES
History of PrairieSkys Fee Lands 1676 1887 1958 2002 2014 Present King Charles II of Dominion of CPR creates Encana created PrairieSky completes PrairieSky is the largest England granted Canada stops Canadian Pacific through merger…
Types of Royalties Crown Royalties The following figure Fee Simple Mineral Title - outlines the royalty PrairieSky owns 7.8 million acres hierarchy. As you Gross Overriding Royalties - PrairieSky owns 7.6 million acres move down…
Dominant Land Position Over 1 million acres of Heritage Royalty lands in the Lloydminster area are under a perpetual royalty-free lease to a third-party producer. 38
Active Management of Land Base License to 13,000 km2 of PrairieSky actively 3D seismic & 45,000 km manages its Fee of 2D seismic Lands: PrairieSkys Seismic Coverage Meeting with operators and providing updates on available…
Recycling the Land Base The perpetual nature of Fee Lands allows PrairieSky Royalty to continually recycle lands and grow its revenue base. PrairieSky leases At the end of the primary lease lands by zone same term, any lands/rights…
Diversity in Top Payers Top 10 payers represent 49% Exposure to various operators with of product revenue, while the diverse expertise ranging from top 25 payers represent 71% private companies to Majors of product revenue 12…
Leadership Team Executive Team Board of Directors Andrew M. Phillips, President & CEO / Director James M. Estey, Chair of the Board Previously, President, CEO & Director of Home Quarter Resources Retired Chairman of UBS Securities…
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