Corporate Snapshot & Select Guidance Q1 2019 average production 74,884 boe/d Q1 2019 adjusted funds flow (millions / per share) $116.6 / $0.44 per share Estimated 2019 annual average production 76,000 – 78,000 boe/d % oil and NGL 21%…
Quarterly average production of 74,884 boe/d, a 2% decrease from 76,323 boe/d in Q1 2018 • Record quarterly adjusted funds flow of $116.6 million ($0.44/basic common share), a 39% increase from $83.7 million ($0.31/basic common share)…
Focused assets in the Peace River Arch Area of Alberta on the Montney/Doig Resource Play • Essentially 100% working interest; 99% of production is operated • Large, contiguous undeveloped land base with an average 89% W.I. •…
STRATEGIC LAND ACQUISITION Key Strategic Attributes • 18 gross (15.1 net) Montney sections adjacent to existing BIR infrastructure • Potential for 4 Montney intervals (Montney D1, D2, C, Basal Doig/Upper Montney) • Strong…
STRATEGIC LAND ACQUISITION – CONT’D 8 • The acquisition provides a rare opportunity to acquire a large contiguous land block in proximity to BIR 3-22 plant as there is currently no open Crown available • Extends liquids production…
KEYS TO SUCCESS Management ? Executives with proven track record, continuity since inception and significant ownership ? Highly experienced Management Team with excellent technical knowledge and a long history with the company…
PROVEN TRACK RECORD AS A LOW COST PRODUCER Profitability Breakdown: 2014 2015 2016 2017 2018 5 Year Average Average AECO (CAD$/GJ) $4.27 $2.55 $2.05 $2.04 $1.42 $2.47 Average WTI (USD$/bbl) $92.99 $48.80 $43.32 $50.95 $64.77 $60.17…
PROVEN TRACK RECORD AS A LOW COST FINDER 15 Adjusted Funds Flow netback recycle ratios Corporate F&D Costs (incl. FDC) & Cash Flow Recycle Ratios 2014 2015 2016 2017 2018 5 Yr Wtd. Avg PDP F&D ($/boe) $13.40 $8.11 $6.42 $6.29…
PROVEN TRACK RECORD AS A LOW COST FINDER 15 Adjusted Funds Flow netback recycle ratios Corporate F&D Costs (incl. FDC) & Cash Flow Recycle Ratios 2014 2015 2016 2017 2018 5 Yr Wtd. Avg PDP F&D ($/boe) $13.40 $8.11 $6.42 $6.29…
2019 CAPITAL PROGRAM THEMES • In 2019, Birchcliff is targeting its total capital expenditures to be less than its adjusted funds flow. Free funds flow is estimated to be $126 MM in 2019(1)(2) • 2019 annual average production guidance…
2019 F&D CAPITAL PROGRAM Drilling & Development Gross Wells Net Wells Capital ($MM) Pouce Coupe(1)(2) Montney D1 Horizontal Natural Gas Wells 6 6.0 $34.8 Montney D2 Horizontal Natural Gas Wells 2 2.0 $11.4 Montney C Horizontal…
2019E NATURAL GAS MARKETING 19 Pricing Hub Forecasted Sales Price at Hub (C$/GJ)(2) Hedged Differential (C$/GJ)(2) Estimated Fuel Cost From Field to Sales Point (C$/GJ)(3) Estimated Transportation Cost From Field to Sales Point…
Q1/19 REALIZED NATURAL GAS PRICING – PHYSICAL SALES 20 (1) Birchcliff has sales agreements with a third party marketer to sell and deliver into the Alliance pipeline system for a contract price, net of transportation. Birchcliff…
RISK MANAGEMENT, HEDGING & DIVERSIFICATION(3) • In 2019, approximately 65% of Birchcliff’s natural gas production will effectively be sold at prices that are not based on AECO (based on 2019 production guidance of 76,000 - 78,000…
BORROWING BASE DETAILS • Subsequent to Q1/19, Birchcliff’s syndicate of lenders completed their semiannual review and have agreed to an extension of the maturity dates from May 10, 2021 to May 10, 2022 and to increasing the borrowing…
MONTNEY/DOIG - A WORLD CLASS RESOURCE PLAY Resource density. Stacked resource up to 300 metres thick. Large areal extent. Extends over 50,000 square miles. Exceptional “fracability”. Low clay content, low Poisson’s Ratio and high…
MONTNEY/DOIG MINEROLOGY LEADS TO EXCELLENT “FRACABILITY” 25 The Montney/Doig Resource Play rock type is composed of a high percentage of hard minerals, and a low percentage of clays and soft minerals. When fractured this results in…
• The Gordondale Acquisition added a fourth commercial development interval in the Montney D2 • Large contiguous land base with 367.4 sections prospective for the Montney/Doig as at December 31, 2018 • Birchcliff has contiguous land…
WATER STORAGE INFRASTRUCTURE • Birchcliff has extensive water storage infrastructure in place to support its completion operations • 920,000 m3 of water storage at 10 strategically located sites • This volume provides…
Montney/Doig Production Owned Infrastructure Pouce Coupe Gas Plant Nova Pipeline System North American Market LNG Export PROXIMAL TO INFRASTRUCTURE WITH LONG TERM EXPOSURE TO LNG EXPORT
POUCE COUPE OVERVIEW • Proven asset in development phase • Wells show high initial deliverability, low terminal decline and stable long term production • Predictable results with improving gas rates & liquids yields • 100% owned…
CONTINUED NATURAL GAS RATE IMPROVEMENT
CONTINUED CONDENSATE RATE IMPROVEMENT
CONTINUED COST AND DESIGN REFINEMENT Overall well costs have slightly increased due to increased frac intensity Both Pouce Coupe and Gordondale have moved to increased frac intensity to maximize oil and condensate rates
POUCE COUPE 2019 LIQUIDS TYPE CURVE 0 500 1000 1500 2000 2500 3000 3500 4000 4500 0 20 40 60 80 100 120 Sales Gas Rate (Mcf/d) Producing Time (Months) Rate of Return (%) WTI ($US/bbl) $55/bbl $60/bbl $65/bbl AECO…
SCIENCE & TECHNOLOGY PAD
GORDONDALE OVERVIEW • Acquired in 2016, Gordondale consolidated a sizeable and contiguous land base within Birchcliff’s existing core area • High oil & NGLs weighting • Strategic infrastructure • Low base decline production • High…
GORDONDALE KEY INFRASTRUCTURE Key Natural Gas Processing Infrastructure AltaGas Gordondale Sour Deep Cut Gas Plant 16-31-078-11W6 Licensed Capacity: ~135 MMcf/d Current BIR Rate: ~100 MMcf/d CNRL Progress Sour Shallow Cut Gas…
GORDONDALE BASE PRODUCTION HISTORY 41 Last well drilled in 2014 (on-stream 2015) with peak production of ~35,000 boe/d AltaGas Deep Cut Plant on stream October 2012 and Montney oil pool development commenced Horizontal gas…
GORDONDALE 2019 D1 & D2 OIL TYPE CURVES 0 50 100 150 200 250 300 350 400 450 0 20 40 60 80 100 120 Oil Rate (bbl/d) Producing Time (Months) D1 Tier 1 Type Curve D2 Tier 1 Type Curve D2 Tier 1 - Rate of Return (%) WTI…
2017 LIQUIDS SUMMARY BUILDING ON THE GORDONDALE ACQUISITION GORDONDALE: CRUDE OIL • Excellent Lower Montney oil inventory in D1 and D2 intervals • Engineered completions drive recovery factor improvements • EOR scheme under…
GORDONDALE: CRUDE OIL • Strong Montney D2 oil and total boe test rates • Strong Montney D1 oil and total boe test rates • Further refinements of engineered completions having positive results POUCE COUPE: CONDENSATE (C5+) • Strong…
GORDONDALE: CRUDE OIL • Successful delineation of the Montney D1 and D2 oil trends to the south • Significant Montney D1 and D2 results offsetting recent land acquisition • Lower GOR areas identified, which will yield higher oil…
ELMWORTH DEVELOPMENT • Received regulatory approval for an acid gas injection well in August 2016 • Preliminary planning underway for a 100% owned and operated 40 MMcf/d natural gas processing plant; currently expected to be…
CONCEPTUAL MONTNEY/DOIG FIELD DEVELOPMENT MODEL 47 STATUS OF MODEL CALIBRATION AND DERISKING FACIES & PETROPHYSICAL GEOLOGICAL, GEOPHYSICAL, GEOMECHANCAL HYDRAULIC FRAC & MICRO SEIS. RESERVOIR MODEL OPTIMIZED DCC & PRODUCTION
ENGINEERED COMPLETIONS FOR MONTNEY/DOIG FULL FIELD DEVELOPMENT 50 Industry Range Birchcliff Best Practices Oil Birchcliff Best Practices Gas Liner type Openhole or Cemented Openhole or Cemented Openhole or Cemented Inter-well spacing…
IQRE continued support for low terminal decline rates from Birchcliff’s existing wells and offsetting industry wells with significant production history. • Deloitte’s 2P Tier 0 type curve has remained at 8.2 Bcf raw gas EUR with the…
Production Processed through the PC Gas Plant 2014 2015 2016 2017 2018 Q1/19 Average daily production, net to Birchcliff: Natural gas (Mcf) 132,808 163,641 168,444 193,417 250,011 242,699 Oil, condensate & NGLs (bbls) 1,065 1,287…
5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 2011 2012 2013 2014 2015 2016 2017 2018 AECO/PC Op. Netback ($/Mcfe) PC Plant Production (boe/d) Average AECO Price vs. PC Gas Plant Operating Netback…
PC GAS PLANT HIGHLIGHTS • Following the successful condensate-rich drilling program, Birchcliff is initiating the engineering and planning of a 20,000 bbls/d liquids handling hub at the PC Plant (anticipated completion in Q3/2020).…
Birchcliff’s average daily production was 77,096 boe/d in 2018 compared to 2,793 boe/d in 2005, a compounded annual growth rate of 29% per year over that span. 1 July 6, 2004: Birchcliff incorporated as a private corporation. 2005: i)…
Birchcliff has increased production at a compound annual growth rate of 29% since 2005. Operating and cash costs have decreased by 66% and 41% since 2008 largely due to horizontal drilling success and benefits achieved from…
Birchcliff has added significant low cost reserves since commencing operations in 2005. On a per common share basis, PDP, 1P and 2P reserves grew 13% per year, 21% per year and 20% per year, respectively. Over 14 years of…
CANADA’S LNG ADVANTAGE Benefits • Massive untapped natural gas resources, Montney Play world class • Low supply cost from Montney play • Proximity to key LNG markets, less than half of the shipping distance to Asia • Low ambient…
ENOUGH RESOURCE TO FILL A 2.2 Bcf/d LNG TRAIN FOR OVER 20 YEARS! 62 5.1 Tcf + 11.2 Tcf / 20 Years = 2.2 Bcf/d BIR Remaining Reserves as at Dec 31, 2018 (gas only) BIR Contingent Resource as at Dec 31, 2018 (gas only) 1 Bcf/d LNG…
2018 MONTNEY/DOIG RESOURCE ASSESSMENT 63 Resource Class Reserves and Resource Volumes (Bcfe)(1)(2) Raw/Sales Low Estimate Case Best Estimate Case High Estimate Case Discovered Cumulative Production(3) Sales 995.4 995.4 995.4…
SERIES A PERPETUAL PREFERRED SHARES Preferred Share Details Series A Number of Shares 2 million Issue Date August 8, 2012 TSX Trading Symbol BIR.PR.A Issue / Par Price $25.00 per share Quarterly Dividend $0.523375 per share Yield…
SERIES C PREFERRED SHARES Preferred Share Details Series C Number of Shares 2 million Issue Date June 14, 2013 TSX Trading Symbol BIR.PR.C Issue / Par Price $25.00 per share Quarterly Dividend $0.4375 per share Yield at Issue 7.0%…
EXECUTIVE OFFICERS A. Jeffery Tonken President, CEO and Chairman of the Board Mr. Tonken is the President, Chief Executive Officer and Chairman of the Board of Birchcliff. He has more than 36 years of experience in the oil and…
EXECUTIVE OFFICERS Christopher A. Carlsen Vice-President, Engineering Mr. Carlsen is the Vice-President, Engineering of Birchcliff and is a Professional Engineer. He previously served as Asset Team Lead and Senior Exploitation…
BOARD OF DIRECTORS 70 A. Jeffery Tonken President, CEO and Chairman of the Board See Mr. Tonken’s biography under “Executive Officers”. James W. Surbey Director Mr. Surbey is a Director of Birchcliff and is a member of the…
BOARD OF DIRECTORS 71 Debbie Gerlach Independent Director Ms. Gerlach is a Director of Birchcliff and is a member of the Audit Committee, Compensation Committee, Nominating Committee and Reserves Evaluation Committee. Ms. Gerlach…
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