Diversified oil value growth Corporate Presentation May 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…
Corporate Information TSX Listed GXE.TO Shares Outstanding (Q1 2019) Production Forecast (2019) 219 million 6,800 7,100 boe/d (90% Liquids) Average Daily Trading (Q1 2019) Net Debt to FFO Estimate (2019) 283k, GXE.CC Approximately 1.0…
Core Areas Lloydminster Lloydminster Heavy Oil 57% of corporate production Dominantly low cost horizontal cold-flow heavy oil wells Central Alberta Central Alberta 29% of corporate production Light/Medium Oil Horizontal light oil…
Financial Strength 2018 Exit Exited 2018 with net debt of 91.9MM 2019 Exited Q1 2019 with 7% reduction in net debt from 2018 Forecasting to exit 2019 with approximately 30% lower net debt and an annualized net debt to funds…
Low Costs Structural Reductions Total costs per unit in 2019 are estimated to be approximately 34% lower than in 2014 Accomplished by drilling low cost horizontal wells primarily on Crown lands, and by growing production and/or…
2019 Plan Provide a solid foundation for future growth Targeting a strategic balance between low-risk production stability, maximizing revenue, and continued improvement of the balance sheet, while preparing for future growth within a…
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 2019 37% base 35% base 32% base 28% base Forecast stable decline decline decline decline (ex-shut-ins)…
Growth History Resume Growing Value per Debt Adjusted Share Gear has recalibrated to the current pricing environment and has all the ingredients for future growth: Deep inventory, strong balance sheet, low costs and a proven history…
Pricing Sensitivity Funds from Operations (FFO) The 2019 budget is estimated to deliver the following results at various realized WTI oil prices (May to December 2019) WTI US/bbl 40 50 60 70 2019 FFO Estimate 39 MM 50 MM 67 MM 83 MM…
Drilling Inventory Competitive Economics Future development and growth will be balanced across the three core areas targeting strong returns on capital and price and egress stability Lloydminster MLU Lloydminster SLL Core Areas SE…
Lloydminster Lindbergh Future growth planned through economic drilling of multi-lateral unlined (MLU) Paradise horizontal wells and single-leg lined (SLL) horizontal heavy oil wells into multiple overlapping formations. 11 wells…
Central Alberta Central Well Capital 2,300k IP365 175 boe/d EUR 185 mboe Wilson Creek Killam Future growth planned through drilling economic light oil wells in Wilson Creek Basal Belly River, Lower Basal Belly River and Ferrier…
SE Saskatchewan GXE Drills to date Torquay two-mile Area Licenses Recent Peer drills Capital 3,350k IP365 170 bbl/d EUR 150 mbbls Future growth planned through drilling horizontal light oil wells in the Torquay 5 wells planned…
Oil Marketing Diversification Oil production sourced from three core areas with distinct pricing benchmarks and egress provides opportunity to balance future investments targeting maximum corporate revenue WCS Heavy oil prices…
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 TBD Cormark Securities Inc. Garett Ursu GMP FirstEnergy Bob Fitzmartyn Haywood Securities Inc. Christopher…
APPENDIX: Economic Assumptions Economics run on flat oil price decks at US50, 60 and 70 per barrel, fx of 0.75 /, WCS differential of 35%, MSW differential of 18.5% and LSB differential of 14%, all in relation to WTI. Price discounts to…
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