Diversified oil value growth Corporate Presentation January 2019
Highlights Diversified oil growth opportunities Three core economic oil development areas with unique pricing streams; Lloydminster Heavy Oil, Central Alberta Light Oil and SE Saskatchewan Light Oil Deep inventory of future drill…
Strategy for Success Disciplined flexible operations Maximize revenues by managing capital, production and inventory to take advantage of pricing volatility. Focus on continuous improvement in execution and in lowering per unit costs…
Core Areas Lloydminster Lloydminster Heavy Oil 59% of corporate production Dominantly low cost horizontal conventional heavy oil wells Central Alberta Central Alberta 30% of corporate production Light/Medium Oil Horizontal light…
Financial Strength 2018 Exit Current forecast to exit 2018 with net debt of 90 - 95 million or approximately 70% drawn on combined credit instruments First half of 2019 Forecasting to invest approximately 40 to 50% of funds from…
Low Costs Structural Reductions Total costs per unit have been reduced by over 35% since 2014 Accomplished by drilling low cost horizontal wells almost exclusively on Crown lands, and by growing production and reducing debt while…
2019 H1 Plan Provide a solid foundation for future growth Targeting a strategic balance between production stability, maximizing revenue, and further improvement of the balance sheet, while preparing for future growth within a stable oil…
Production Summary 35,900/boe/d 13,500/boe/d 164MM capital 15MM capital 24,000/boe/d 72MM capital 16,500/boe/d 50MM capital 30,000/boe/d 110MM capital 2019 H1 37% base 35% base 32% base 28% base 30% base Forecast 7,300 to…
Growth History Resume Growing Value per Debt Adjusted Share Gear has survived and recalibrated to the current pricing environment and has all the ingredients for future growth; Low costs, deep inventory, strong balance sheet and a…
Pricing Sensitivity Funds from Operations (FFO) First half 2019 budget prepared using strip pricing on January 9, 2019 with an estimated WTI oil price of just over US50/bbl Balance sheet strength and optionality to increase investment is…
Drilling Inventory Competitive Economics Future development and growth will be balanced across the three core areas targeting strong total returns on capital Lloydminster MLU Lloydminster SLL SE Saskatchewan Core Areas Central…
Lloydminster Lindbergh Future growth planned through drilling of extensive inventory of multi-lateral unlined Paradise (MLU) horizontal wells and single-leg lined (SLL) horizontal heavy oil wells into multiple overlapping formations;…
Central Alberta Central Well Capital 2,300k IP365 175 boe/d EUR 185 mboe Wilson Creek Killam Future growth planned through drilling a combination of light oil wells in Wilson Creek Basal Belly River, Lower Basal Belly River and…
SE Saskatchewan Torquay 2-mile GXE Planned Drills Licences since 2018 Capital 3,350k IP365 170 bbl/d EUR 150 mbbls Future growth planned through drilling of extensive inventory of Torquay, Bakken and Ratcliffe locations 2019 H1…
Oil Marketing Diversification Oil production sourced from three core areas with unique individual pricing benchmarks provides opportunity to balance future investments targeting maximum corporate revenue Heavy oil pricing is…
Hedging Volume Sold Call Bought Put Sold Put Sold Swap Product Term (inclusive) Contract Currency bbl/d /bbl /bbl /bbl /bbl WTI Jan 19 Dec 19 3-way collar 600 USD/CAD U66.00 C62.00 C52.00 WTI Jan 19 Dec 19 3-way collar 600 USD/CAD…
Gear Team Management Role Prior Experience Ingram Gillmore President & CEO, Director VP Engineering ARC Resources, Talisman Yvan Chretien VP Land VP Land ARC Resource, CNRL Bryan Dozzi VP Engineering Engineering Manager Gear, Rock Energy…
Research Coverage Firm Analyst AltaCorp Capital Inc. Thomas Matthews Beacon Securities Limited Lyndon Dunkley Canaccord Genuity Brandon Friedt Cormark Securities Inc. Garett Ursu GMP FirstEnergy Bob Fitzmartyn Haywood Securities Inc.…
APPENDIX: Economic Assumptions Economics run on flat oil price decks at US50, 60 and 70 per barrel, fx of 0.75 /, WCS differential of 40%, MSW differential of 20% and LSB differential of 10%, all in relation to WTI. Price discounts to…
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