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March 2019 Corporate Presentation – Seven Generations Energy Ltd

Seven Generations Energy Ltd · Mar 4, 2019 · 29 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.

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  1. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 1
    TSX: VII CORPORATE PRESENTATION March 2019
  2. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 2
    SEVEN GENERATIONS ENERGY Serving our stakeholders through: Differentiated attention to selection, development & replenishment of the lowest supply cost resource Best in class execution through safe, responsible, innovative and…
  3. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 3
    7G CORPORATE PROFILE Corporate Highlights Premier Alberta Montney Pure-Play Canadas Largest Condensate Producer 76 Mbbl/d of condensate sales in 2018 156 bbls/MMcf condensate-gas-ratio in 2018 Diversity of Product Streams and…
  4. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 4
    THE CORNERSTONES OF OUR BUSINESS Return of Capital Return on Capital Free Cash Flow Financial Market Sustainability Resource Access Quality & Low Supply Cost Stakeholder Strong Service balance sheet Large,…
  5. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 5
    7GS LOW SUPPLY COST Montney Breakeven Henry Hub at Flat US60/bbl WTI, 10% IRR (/Mcf)1…
  6. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 6
    TRACK RECORD OF INDUSTRY LEADING RETURNS AND ADJUSTED FUNDS FLOW PER-SHARE GROWTH 7G Quarterly and Annual Adjusted Funds Flow per Diluted Share (/share) 5.00 2018 - 4.60/sh 4.00 2017 - 3.37/sh 3.00 2016 - 2.30/sh 2014 -…
  7. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 7
    MARKET ACCESS THAT DIFFERENTIATES 7G Gas Market Sales Points AECO 9% AECO 11% AECO 5% Dawn 13% Dawn 15% Dawn 15% Ventura 4% Malin 13% Gulf 18% Gulf 18% Gulf 17% Chicago 55% Chicago 55% Chicago 50% GTN: 90 MMcf/d…
  8. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 8
    CANADIAN CONDENSATE MARKET OVERVIEW Forecast Supply & Demand of WCSB Condensate (Mbbl/d)1 Edmonton Condensate vs. Crude Oil Prices (US/bbl)2 800 Supply grew faster than demand + Maintenance & curtailments impacts 70 60 50 600 Total…
  9. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 9
    A HIGH QUALITY RESOURCE Infrastructure Footprint 15+ years Natural Gas Processing: of core inventory 1 Bcf/d capacity Nest 1/2/3 510 MMcf/d owned & Upper & Middle Montney operated at Cutbank/Lator 250 MMcf/d owned & operated…
  10. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 10
    2019 BUDGET 2019 Guidance Sustaining Capital 1.1 billion Nest 2 Development Discretionary Capital 0.15 billion Value Total Capital Investment 1.25 billion Enhancing Average Production 200 - 205 Mboe/d H1/19 Production 195-200…
  11. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 11
    DEVELOPMENT ROADMAP Define Nest 2 Return to Nest 1 for development Core Integrate Nest 3 development sub-regions Step into Nest 2 East Areas Define Nest 1 perimeter Step into Nest 1 Grow Nest 3 to pipeline capacity Evaluate…
  12. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 12
    2019 CAPITAL ALLOCATION GUIDING PRINCIPLES Free cash flow upside from higher prices 2,000 1,800 70 WTI 1,600 1,400 55 WTI 1,200 50 WTI Delineation 1,000 800 600 2019 Free cash flow upside Sustaining from lower…
  13. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 13
    NEST 2 UPDATE Nest 2 2019 Activity Condensate gas ratios (bbl/MMcf) vs. time (normalized month) 500 0 0 12 24 2017 Nest 2 Type Curve North South East West Liquids Nov 2017 May 2018 2019 More geotechnical data supports…
  14. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 14
    NEST 1 UPDATE ENHANCED ECONOMICS IP60 (2 HZ) Cumulative condensate (Mbbl) vs. time (normalized month) 1,413 1,963 boe/d Nest 1 2019 Activity 64% Condensate 300 IP96 2,030 boe/d 250 55% Condensate 200 Flowtest IP20 (7 HZ) IP80…
  15. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 15
    LOWER MONTNEY UPDATE Triple-stack test Comingled vertical test (5d): 2MMcf gas; 162 bbls condensate 2,800-3,000 meters IP90: 1048 boe/d, 72% condensate Denotes approximate areas of delineation activity Latest test…
  16. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 16
    ROBUST RESERVE METRICS BACKSTOP VALUATION UPSIDE Risked 1.32 billion boe Development Risked Unclarified Contingent (2C) Resource Development (23 MMboe) Pending - Best estimate of economically recoverable resource (1,300 MMboe)…
  17. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 17
    SUMMARY OF PREMIUM SINGLE WELL ECONOMICS & OTHER INVENTORY Nest 2 Core Nest Weighted Nest 1 Nest 3 Development Inventory Average South East West North IP30 (boe/d) 1,500 1,950 - 2,350 2,000 1,900 15 years IP365 (boe/d) 775 1,150…
  18. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 18
    THE 7G INVESTMENT THESIS Expanding free cash flow Moderating declines reduce sustaining capital Major gas processing investments completed Delivering operating excellence Execution, optimization and cost control Consistent…
  19. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 19
    TSX: VII APPENDIX
  20. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 20
    7GS GUIDING PRINCIPLE STAKEHOLDER SERVICE Stakeholder Differentiation We believe that companies have only the rights given to them by society. While people have a natural entitlement to basic rights, corporations are an instrument…
  21. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 21
    2019 BUDGET: BALANCE SHEET MANAGEMENT Net debt to trailing 12 month adjusted EBITDA Comfortably levered in lower prices 2.4x < 2.0x Target 1.8x 1.8x Potentially under- 1.4x 1.2x levered with 1.2x higher prices 0.9x 2015…
  22. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 22
    HEDGING STRATEGY Quarterly Revenue (/boe) 60 Hedging program has 12.00 Realized Hedge Gain/(Loss) (b/oe) reduced revenue volatility by 25% Price Realization (/boe) 50 8.00 40 4.00 30 0.00 20 -4.00 Hedging…
  23. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 23
    CURRENT HEDGE POSITIONS AS AT DECEMBER 31, 2018 CAD WTI Collars CAD WTI Sold Puts USD WTI Collars USD WTI Sold Puts Crude Oil bbl/d C/bbl bbl/d C/bbl bbl/d US/bbl bbl/d US/bbl 2019 23,500 58.09 75.93 7,500 41.00 7,250 56.00 63.28…
  24. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 24
    SELECTED FINANCIAL AND OPERATIONAL INFORMATION VII - Recent Quarterly Results OPERATING RESULTS Q4 2018 Q3 2018 Q2 2018 Q1 2018 Q4 2017 Q3 2017 Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Q1 2016 YE 2018 YE 2017 Average daily production…
  25. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 25
    SWEET SPOT IN THE MONTNEY Over Pressured High Productivity Brittle Rock High Recovery Factor Thickness Large Resources in Place Lower Temperature High Liquids Content 1) Sources: Canadian Discovery Ltd. & Graham Davies…
  26. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 26
    RESPONSIBLE DEVELOPMENT HIGHLIGHTS Safety Environment Community Total Recordable Incident and Lost Time Injury Frequency Rates 1.5 0.20 0.15 1.0 0.10 0.5 0.05 0.0 0.00 2014 2015 2016 2017 2018 TRIF LTIF Safety first…
  27. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 27
    IMPORTANT NOTICE The Nest 1 type-curve that was referenced is the same type-curve that was are cautioned that the type-curves and forecast development area Note Regarding Potential Drilling Opportunities provided in the prospectus…
  28. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 28
    DEFINITIONS AND ABBREVIATIONS A annual m metres AECO physical storage and trading hub for natural gas on the TransCanada Alberta transmission Mbbl thousand of barrels system Mboe thousands of barrels of oil equivalent Alliance…
  29. March 2019 Corporate Presentation – Seven Generations Energy Ltd – slide 29
    For more information: Brian Newmarch Vice President Capital Markets 1.403.767.0752 bnewmarch7genergy.com Ryan Galloway Investor Relations Manager 1.403.718.0709 ryan.galloway7genergy.com www.7genergy.com TSX: VII

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