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Q3 2018 Earnings Results – Advantage Oil & Gas Ltd.

Advantage Oil & Gas Ltd. · Nov 1, 2018 · 24 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. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 1
    Record Q3 2018 Production & Three Year Plan to Accelerate Pipestone Condensate Development Investor Presentation TSX: AAV November 2018
  2. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 2
    ADVANTAGE AT A GLANCE TSX 52-week trading range 2.85 - 7.44 Shares Outstanding (basic) 186 million Market Capitalization 0.6 billion Enterprise Value 0.8 billion Estimated Dec. 31, 2018 Advantage Montney Assets Bank Debt (68%…
  3. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 3
    DEVELOPMENT PLAN FURTHER STRENGTHENS BUSINESS MODEL Solid Today Solid Tomorrow Free Cash Generating Asset Reinvest to Diversify & Enhance Free Cash Generation Ultra-low Cash Cost Structure Maintain & Strengthen Netbacks…
  4. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 4
    2019-2021 DEVELOPMENT PLAN - INTERNALLY-FUNDED GROWTH Condensate & Light Oil Focused Fully funded through cash flow & 6 miles Progress credit facilities 690 million capital investment Drill 96 Montney wells: Glacier 42…
  5. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 5
    STRENGTHENING FOUNDATION 2021 HIGHLIGHTS 700% Increase in Liquids Production 14,000 Bbls/d 2021 Exit Liquids Rate 25% Increase in Total Annual Production to 52,330 Boe/d (8% CAGR) 82% Premium C5+/Light Oil content of liquids…
  6. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 6
    THREE YEAR PLAN STRENGTHENING FOUNDATION Total Production (boe/d)(1) Liquids Production and 14,000 Composition (bbls/d) (1) Exit 9% 52,300 11,370 6% 47,850 45,000 62% 22% 7% 15% 7,000 125% 81% C5+ 3,100 80% 75% 2019E 2020E…
  7. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 7
    THREE YEAR PLAN ADJUSTED FUNDS FLOW (FFO) FFO and Capital Expenditures(1) Return on Average FFO per Share(1) ( millions) Capital 34% 1.67 315 Employed 10% -15% 26% 1.25 225 235 225 240 185 0.99 2019E 2020E 2021E 2019E 2020E…
  8. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 8
    FINANCIALLY ROBUST AT LOW PRICES GAS PRICE SENSITIVITY (1) OIL PRICE SENSITIVITY (1)(2) AECO 1.50/mcf AECO 1.75/mcf AECO 2.00/mcf WTI US55.00/bbl WTI US65.00/bbl WTI US75.00/bbl 1.70 1.96 FFO per Share (1) 1.64 FFO per Share(1)…
  9. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 9
    CAPITAL EXPENDITURES FOCUSED ON DRILLING 2019 Capital By Area Three Year Total Capital By Area Other Other Progress 6% 7% 225 Progress 6% 690 million 4% million Glacier Wembley Glacier 32% 24% 49% Wembley 47% Valhalla…
  10. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 10
    REVENUE & MARKET DIVERSIFICATION, HEDGING AND TRANSPORTATION Revenue Diversification(1) Current Hedging Transactions (MMcf/d) 140 60% 3.45 120 2.87 50% 25% 100 2.87 40% Liquids 80 2.75 2.93 3.01 2.87 48% 60 30% 8% 58% 2.75…
  11. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 11
    OPERATIONS OVERVIEW SHIFTING TO MIDDLE MONTNEY LIQUIDS Deep Liquids-Rich Inventory(1)(2)(3) Booked Unbooked Upside Undeveloped TOTAL future Progress location inventory 1,200 to 1,400 Glacier 613 Valhalla 62 214 200 123…
  12. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 12
    PIPESTONE/WEMBLEY ULTRA-RICH LIQUIDS DEVELOPMENT The premium condensate play in Canada Pipestone 31 net sections BBI Recent M&A land values exceeding 4.5 Million per CNQ ECA section Kelt 42 wells planned by 2021 Inventory of 200…
  13. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 13
    VALHALLA LIQUIDS DEVELOPMENT ADVANCING Industry results in Middle Montney have proven ultra-rich condensate on offsetting lands AAV Liquids Handling Hub Advantage to target same interval Q1 2019 Competitor well IP30 1,400 Boe/d…
  14. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 14
    LIQUIDS-RICH MIDDLE MONTNEY AT GLACIER STEPPING UP Early development focussed on upper and lower Only 41 Middle Montney Montney drills to date Liquids range from 25-80 bbls/mmcf in Middle Montney 90 net sections 750 well…
  15. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 15
    STRATEGIC INFRASTRUCTURE CONTROL, FLEXIBLE PIPELINE ACCESS 100% Owned Glacier Gas Plant 400 mmcf/d Raw Gas + 6,800 bbls/d C3+ Liquids Extraction Advantage Gas Plant Alliance Sales Gas Line Liquids Handling Hub Pembina NGL…
  16. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 16
    Financial Discipline Operational Excellence Returns Focus
  17. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 17
    APPENDIX 17
  18. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 18
    THREE YEAR DEVELOPMENT PLAN DETAILS Guidance and Estimates 2019 Guidance (3) 2020 Estimate (4) 2021 Estimate (4) Average production (Boe/day) 43,500 - 46,500 47,850 52,300 Gas production (mmcf/d) 244 to 260 245 246 Liquids…
  19. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 19
    GLACIER LOCATED IN THE HEART OF THE MONTNEY RESOURCE PLAY Montney Siltstone Comparison: 700 times more permeability 4x more formation thickness Very low clay content Liquids & Improved well efficiencies strong economics Up…
  20. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 20
    CASH COSTS VS. OIL & NGLS WEIGHTING - 2019 2019E Benchmarking(1)(2) 25 100% Oil & NGLs Weighting 20 Oil & NGLs Weighting of 15% to 30% 80% Oil & NGLs Weighting (%) Average: 13.85/boe Cash Costs (/boe) 15 60% 10…
  21. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 21
    CONTINUOUS IMPROVEMENT HAS CREATED INDUSTRY LEADING EFFICIENCIES Production restrictions 21
  22. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 22
    MIDDLE MONTNEY PRODUCTION CONTINUES TO INCREASE 2018 6 wells Gen 6: Slickwater, OH Packers, Stage 2015+ Middle Montney wells with frac design changes completions Avg 34 frac stages including 20 frac stages & numerous mechanical…
  23. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 23
    GLACIER MONTNEY ASSIGNED 2P EUR PER WELL & INTERVAL Glacier - 2P Recoveries per Interval(1) of Gross HZ Wells 2P Recovery [bcf/well] Developed Undeveloped Total Developed Undeveloped Total Interval YE YE YE YE YE YE YE YE YE YE YE…
  24. Q3 2018 Earnings Results – Advantage Oil & Gas Ltd. – slide 24
    ADVANTAGE CONTACT INFORMATION Investor Relations 1.866.393.0393 iradvantageog.com www.advantageog.com Listed on TSX: AAV Advantage Oil & Gas Ltd. Suite 300, 440 2nd Avenue SW Calgary, Alberta T2P 5E9 Main: 403.718.8000…

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