SUSTAINABLE CONVENTIONAL RESOURCE COMPANY TSX: SGY JANUARY, 2019
REASONS TO OWN SURGE TSX: SGY Value based with a strong focus on shareholder returns High quality conventional, large OOIP(1), light/medium gravity crude oil asset base; 84% of production is oil + liquids; low decline of 23%;…
CONSISTENT PRODUCTION GROWTH Surge management continues to deliver quarterly production growth 80% Production Growth Since Q2 2016 23,000 21,000 Accretive light oil acquisition 19,000 Production (boepd) 17,000 15,000…
2019 CAPITAL BUDGET AND PRODUCTION GUIDANCE Cost effective, sustainable, low decline production base Capital Category 2019 Total Drilling and Completions 100 million Facilities, Equipment, and Pipelines 25 million Other (Land,…
SURGE ASSET BASE HIGHLIGHTS An operational platform to continue to execute a sustainable model Over 2.4 billion net barrels of conventional OOIP under management - with an estimated 6.9% recovery factor(1) to date; Proven plus…
OPERATIONS FOCUSED IN 4 CORE AREAS Large OOIP pools in established conventional reservoir trends Greater Sawn: Total: 5,700 boe/d (98% Oil & NGLs) Surge 2019 Average Production Total: 22,000 boe/d (84% Oil & NGLs) Valhalla:…
TARGETING CONVENTIONAL RESERVOIRS Surge focuses on reservoirs at the conventional end of the permeability spectrum Recovery factors, internal rates of return (IRR)(1), decline rate, and profit to investment ratio (PIR)(1) increases,…
NET OOIP OF 2.4 BILLION BARRELS Large OOIP, with low recovery factors - focused in conventional reservoirs SGY Net CTD(2) Total Booked Net Total Net drilling Estimated Net Avg. WI Oil Independent Recovery Core Area Formations…
SPARKY A DOMINANT POSITION Applying modern technology to a prolific Western Canadian formation AB SK The Sparky is a well established prolific oil producing formation in Western Canada. Surge holds a dominant land position in the…
SPARKY - A DIVERSIFIED LOW RISK ASSET BASE Over 800 MMbbls of net OOIP and 400 drilling locations 800 MMbbls of net OOIP Wainwright 160MMbbls OOIP 400 net drilling locations (97 booked) 11 year drilling inventory Lakeview (Lloyd)…
SPARKY TOP QUARTILE ECONOMICS Competing with the best light/medium oil plays in Western Canada 1.60 1.40 1.20 As per Scotiabanks Playbook 1.00 As per internal estimates(1) Profit to Investment Ratio (9%) ** Source:…
SPARKY EYEHILL SUSTAINABLE DEVELOPMENT 165MMbbl net OOIP estimated with 1.5MMbbls produced to date Eyehill - Sparky Type Log 06-14-037-03W4 Sparky Sands 06-14-37-3W4 Surge has now captured and controls over 85% of the total…
GREATER SAWN - CONCENTRATED LIGHT OIL 675 million barrels net OOIP in concentrated Slave Point reservoirs Sawn OOIP of 675 million bbls net of light oil OOIP: 200 MMbbl net (35-42 API). Development inventory of 119 net locations…
SLAVE POINT HZ AVERAGE IP180s (2011-2018) Well results on Surges land base indicates higher quality reservoir 180 **Data Source: GeoScout. Surge Assets Yielding Best Results In Area 160 bopd 160 145 bopd 140 All Wells Single…
VALHALLA STACKED MULTI-ZONE POTENTIAL Multiple large OOIP light oil reservoirs provide a sustainable drilling inventory and production base Doe Creek 250 MMbbls of net combined OOIP on Surges Valhalla lands. Montney Doig wells…
SHAUNAVON 425 MMbbl net OOIP on Surge lands in the Upper and Lower Shaunavon Total Shaunavon production (Upper & Lower) is 2,500 bopd. Upper Shaunavon net OOIP estimated to be 225 MMbbl. 100 net locations (48 net booked). 9…
HIGH QUALITY CRUDE OIL ASSET BASE Positioned for long term sustainability Low base production decline of 23%; high netbacks; excellent capital efficiencies; Dividend of 0.10 / share annually (dividend yield 6%) Surge reported a low…
APPENDIX 20 FOOTNOTES INCLUDED IN THE BACK AS ENDNOTES
RISK MANAGEMENT / HEDGING STRATEGY The Company has an on-going, risk management / hedging program designed to lock in future cash flows to protect the Companys capital program and fund dividends. Below is a list of Surges current hedging…
RISK MANAGEMENT / HEDGING STRATEGY The Company has an on-going, risk management / hedging program designed to lock in future cash flows to protect the Companys capital program and fund dividends. Below is a list of Surges current hedging…
INTEREST RATE HEDGING & CONVERTIBLE DEBENTURE INTEREST RATE HEDGE Notional Amount Surge Type Term Surge Pays Fixed Rate SGY Pays (CAD) Receives Semi-Annual Step Up Beginning at 1.786% Fixed-to-Floating Rate Swap Feb 2018 to Feb…
ANALYST COVERAGE Financial Institution Analyst Email Address Acumen Capital Partners Trevor Reynolds treynoldsacumencapital.com BMO Capital Markets Ray Kwan ray.kwanbmo.com Canaccord Genuity Anthony Petrucci…
CORPORATE PARTNERS Advisors National Bank of Canada Bank of Nova Scotia Canadian Imperial Bank of Commerce Toronto-Dominion Bank Bank of Montreal Bankers Syndicate: ATB Financial HSBC Bank Canada Wells Fargo Goldman Sachs BDC…
CAPITAL MANAGEMENT MEASURES Capital Management Measures Dividend Payout Ratio Dividend payout ratio is calculated as the dividends paid for the respective period divided by adjusted funds flow. This capital management measure is used…
NON-GAAP FINANCIAL MEASURES Non-GAAP Financial Measure Certain secondary financial measures in this presentation namely, adjusted funds flow are not prescribed by GAAP. This non-GAAP financial measure is included because management uses…
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