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SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc.

Whitecap Resources Inc. · Jul 31, 2014 · 33 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. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 1
    SUCCESS FOCUS = + + MOTIVATED PEOPLE QUALITY ASSETS SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM July 2014
  2. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 2
    Whitecap Profile TSX: WCP Shares outstanding (MM) Basic 245.6 Fully diluted 251.0 Enterprise value (B) 4.8 Annual dividend (/share) 0.75 2014 average production (boe/d) 31,600 Netback (/boe) Operating 46.90 Cash flow 42.70…
  3. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 3
    Founding Principles Total Shareholder Return MOTIVATED PEOPLE + QUALITY ASSETS + FOCUS = SUCCESS Founding Principles Employees are shareholders Light oil focus (80 to 100 WTI platform) Per share growth (cash flow, production,…
  4. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 4
    WCP Employee Share Ownership Total Employee Ownership 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 2010 2011 2012 2013 2014 Since 2010 insiders increased common share…
  5. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 5
    Results and Track Record Annual Production Growth Annual 2P Reserves Growth 40,000 170 250,000 2013 F&D Costs 900 TP P+P 145 784 150 Incl. FDC 20.31 16.96 746 800 35,000 137 130 200,000 P+P Recycle Ratio = 2.3x 122 130 643 700…
  6. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 6
    Results and Track Record Annual Cash Flow Growth 700.0 3.00 2.51 600.0 2.50 2.14 500.0 1.84 2.00 (Cash Flow / share fd) 1.68 400.0 1.34 1.50 (MM) 632.1 300.0 492.5 1.00 200.0 0.48 278.8 0.50 100.0 193.9…
  7. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 7
    7 Key Attributes to WCP Dividend-Growth Strategy Focus on organic per share growth (5 - 6% per year), supplement with accretive acquisitions Provide sustainable dividend without DRIP, increase prudently Maintain predictable and…
  8. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 8
    Sustainable Asset Base 2014 Free Cash Flow by Area 250 200 225 108 150 155 80 100 118 36 117 71 100 50 75 64 47 0 Saskatchewan Garrington/Ferrier Pembina NW AB/BC Operating Income Development Capital Free Cash…
  9. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 9
    2014 Development Capital 2014 Capex by Area (%) 2014 Well Count (gross) Garrington/Ferrier Saskatchewan 130 108 120 38% 110 100 90 24% 80 2% 70 Other 60 50 21% 25 15% 40 18 30 11 20 10 NW AB/BC 0 Pembina Sask…
  10. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 10
    Predictable and Stable Production Base Base and new well production is predictable and repeatable High level of certainty of achieving forecasted volumes Key characteristics: Areally consistent reservoirs Large resource in place,…
  11. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 11
    Financial Prudence and Risk Management C99.22 C98.26 C96.53 17,500 105.00 15,000 100.00 Oil Hedges 12,500 95.00 C/bbl WTI 10,000 bbls/d 90.00 7,500 5,000 85.00 Objective: 2,500 80.00 1) Mitigate price…
  12. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 12
    Sensitivities 2014 Cash Flow Sensitivities and Assumptions Parameter Annual Base Sensitivity Impact (000s) Oil price (Edmonton Par C/bbl) 101.00 +/- 1.00 3,300 Exchange rate (CAD/USD) 0.92 +/- 0.01 3,400 Gas price (C/GJ AECO)…
  13. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 13
    2014 Whitecap Sustainability Total Payout Ratios EDMONTON PAR (C/bbl) 110 105 100 95 90 85 4.75 89% 92% 95% 98% 102% 105% 4.50 90% 92% 95% 99% 102% 106% AECO (C/GJ) 4.25 90% 93% 96% 99% 103% 106% 4.00 90% 93% 96% 99% 103%…
  14. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 14
    Core Areas of Operations Boundary Oil weighting 91% Light Oil Development Inventory 2,372 Drilling inventory 114 Oil New well netback (/boe) 58 BRITISH COLUMBIA Oil weighting 59% Montney Drilling inventory 53 Oil New well…
  15. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 15
    Boundary Lake Asset Characteristics Operated, 35o API light oil, focused land base Avg 54% WI with 3 operated units Unit 2 2,200 boe/d productivity Boundary Lake zone at 1,300m depth Triassic E 45/boe netback (91% oil + NGLs)…
  16. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 16
    Pembina Cardium Legacy Characteristics Pattern waterfloods, operated, 38o API light oil 6 Units (46 100% WI) Total production 1,400 boe/d (83% oil + NGLs) Average base decline of 5% CPOU1 1,700m depth 69.5% CPDU1 79.1% Primary…
  17. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 17
    Pembina Cardium Non-Unit Lands Significant land position offsetting mature waterfloods (87% avg WI) Acquired New Hz Wells Proximity to pressure support results in shallower decline than typical Cardium Hz type curve 52 wells…
  18. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 18
    Exceptional Type Curve Economics West Pembina Boundary Boundary Type Well Economics Cardium Vertical Horizontal DCE&T (MM) 2.95 1.20 1.80 Production, IP30 (boe/d) 265 32 80 Production, IP365 (boe/d) 140 30 74 P+PA Reserves (Mboe)…
  19. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 19
    PRA Valhalla Region Montney Oil Waterflood WCPs original asset low risk light oil (36 API) Primary asset: Montney Oil large oil in place Valhalla North Montney Oil Pool Shallow-base decline of 12% Ongoing optimization and…
  20. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 20
    Cardium Horizontal Resource Play Cardium oil resource play repeatable and expandable Edmonton Light sweet oil (40 API) West Pembina East Pembina Industry leading capital efficiencies (2011 to 2013) Low operating costs (< 9.00/boe)…
  21. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 21
    Western Saskatchewan Viking Oil Light oil (36 API) Viking resource play WC Sask Viking Type Curve True resource play, statistically quantified 140 Strong capital efficiencies 120 118 boe/d Decline mitigation via waterflood 100…
  22. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 22
    Exceptional Type Curve Economics Lucky Hills/ East Pembina Garrington Garrington Type Well Economics Whiteside Viking Cardium Cardium (Standard) Cardium (ERH) DCE&T (MM) 0.93 2.50 3.00 3.60 Production, IP30 (boe/d) 118 285 319 476…
  23. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 23
    PRA Deep Basin Dunvegan Oil New light oil Hz resource play Valhalla North Play characteristics Light oil (39 - 42 API) Thick pay section: 2 - 3x times Cardium DOIIP/section Grande Prairie Exceptional reservoir quality: more…
  24. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 24
    Exceptional Type Curve Economics Elmworth Karr Type Well Economics Dunvegan Dunvegan DCE&T (MM) 3.30 3.70 Production, IP30 (boe/d) 299 416 Production, IP365 (boe/d) 174 198 P+PA Reserves (Mboe) 430 500 Year 1 Oil + NGLs (%)…
  25. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 25
    Upside Potential WCP Oil Resource Plays Avg To Date 2P Booked Upside Locations WI DOOIP Cum Recovered Reserves Recovery Resource Recovery Total Booked Unbooked Formations % (Gross) (Gross) % (WI) % (WI) % (Gross) Viking 86.2 1,314.1…
  26. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 26
    2014 Outlook 2013 2014e % Increase Operational Average production (boe/d) 19,769 31,600 60% Development capital (MM) 190 307 62% Wells drilled (gross) 100 162 62% Financial Cash flow netback (/boe) 38.80 42.70 10% Cash flow (MM) 279 493…
  27. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 27
    The Whitecap Investment Opportunity Visible growth per share; CF, production, reserves, NAV Growth 10+ years high netback light oil development drilling locations Meaningful and consistent monthly dividends without DRIP Income…
  28. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 28
    Research Coverage Current Price Targets AltaCorp Capital 16.00 GMP Securities 17.00 BMO 17.00 Macquarie Equity Research 19.00 Canaccord Genuity 16.50 National Bank Financial 19.50 CIBC World Markets Inc. 19.00 Peters & Co. 17.25…
  29. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 29
    TSX:WCP www.wcap.ca July 21, 2014 29
  30. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 30
    Whitecap Acquisition Purchase Price - 692.7MM Boundary Lake Production Current 6,500 boe/d (83% oil + NGLs) Valhalla Capability 7,550 boe/d (83% oil + NGLs) 92,000 / boe/d 16% base decline 96% operated 60.5% average working…
  31. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 31
    Whitecap Acquisition Rationale Increases WCP sustainable growth + dividend model Reduce corporate decline rate by 3%: 27% base decline in 2014 and 24% in 2015 Increases light oil development drilling inventory by 13%: Total 2,372…
  32. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 32
    Growth + Free Cash Flow Increases Whitecap sustainability + Outstanding capital efficiency of 17,000/boe/d (930K DCE&T, 56 boe/d IP(365)) + Excellent netbacks - 58.00/boe (79% oil & liquids) = Payout of initial capital in 8 - 9…
  33. SUSTAINABLE LIGHT OIL GROWTH + INCOME PLATFORM – Whitecap Resources Inc. – slide 33
    Footnotes 2014 Price assumptions throughout this presentation are actual commodity prices for January to June and Edmonton Par C101.00/bbl, AECO C4.25/GJ for the balance of the year. Slide 2: (1) Whitecaps reserves based on McDaniel &…

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