Corporate Profile ARC Is a Canadian Oil and Gas Producer in Its 23rd Year of Delivering on Its Disciplined, Returns-focused Value Proposition Corporate Summary Founded July 11, 1996 Production (Q1 2019) 139,054 boe/day Reserves (2P…
2019 Guidance 2019 Capital Program Focused on Investing in Multi-year Development Projects to Grow Liquids Production 2019 Guidance 2019 YTD Actuals Production Crude oil (bbl/day) 18,000 - 22,000 18,251 Condensate (bbl/day) 7,500 -…
Financial and Operational Highlights Three Months Ended (Cdn$ millions, except per share and per boe amounts) December 31, 2018 March 31, 2019 March 31, 2018 Production Crude oil (bbl/day) Condensate (bbl/day) Crude oil and…
ARC Has Delivered on Its Commitments ARC’s Plan Remains Focused on Profitability, Sustainability, and Creating Optionality for the Long Term 2017 Monthly dividend of $0.05 per share Divested Saskatchewan assets Eliminated DRIP and…
ARC’s Three-year Plan Three-year Capital Investment Program Will Result in Meaningful Liquids Production and Funds from Operations per Share Growth 2020 2021 Maintain Share Count Bring on Dawson Phase IV in Q2 Bring on Ante Creek…
Infrastructure Investment in Greater Dawson Area Is Supporting ARC’s Broad Shift to Liquids-rich Lower Montney Facility and Infrastructure Pre-drill 14 Wells Drill 8 to 10 Wells per Year 40% of Field Netback Required to Sustain…
Creating a Sustainable Dividend-paying E&P Company ARC’s continued focus on maintaining a strong balance sheet, targeting a 25 per cent payout ratio, improving capital efficiencies to preserve operating netbacks, targeting decline…
ARC’s current funding model includes the reinvestment of proceeds from 2016 and 2018 non-core dispositions, allowing ARC to fund infrastructure and profitably grow the business • Once the productive capacity at Dawson Phase IV is…
uids Dry Gas Red Creek Attachie Septimus Tower Parkland Sunset Sunrise Sundown Dawson Pouce Coupe Ante Creek 1,000m 2,000m 3,000m 1,000m 2,000m Montney Erosional Edge Lower Montney 10 kPa/m Line Condensate-rich…
Physical Marketing Activities Crude Oil & Liquids ARC Natural Gas Diversification (5)(6) Hedged Midwest US Floating Dawn Floating AECO Floating Station 2 Floating Henry Hub Floating Malin Floating ARC’s Crude Oil & Liquids Sales…
Natural Gas Integrated physical marketing and financial risk management strategies enable ARC to effectively execute on its long-term plans • Market Access – Firm transportation pipeline agreements to support existing production and…
Multiple Layers to Develop Up to 1,000 Feet Thick, ARC’s Montney Assets Have Significant Future Delineation Opportunities Attachie Septimus Sunrise Tower Parkland Dawson Pouce Coupe Montney A Montney B Montney C Montney D…
Large-scale Montney Resource Extensive Development Potential from Montney Assets with TPIIP of 14.3 Billion Barrels of Oil and 101.8 Tcf of Shale Gas (1) Oil 17 MMbbl Condensate & NGLs 157 MMbbl 2.8 Tcf ECONOMIC CONTINGENT…
Large Inventory of Economic Development Opportunities • Pembina area has ~600 future drilling opportunities in the Cardium based on ARC’s internal evaluation GLJ Has Recognized over 3,500 Future Drilling Locations across ARC’s Montney…
Current Activity across ARC’s Asset Base ARC Is Advancing Multiple Liquids-rich Projects BC AB Sunrise Phase II Dawson Phase I & II Upgrade Dawson Phase IV Ante Creek Expansion Attachie West Phase I 3rd largest Montney…
2019 Budget of $775 Million Delivers Annual Production of 135,000 to 142,000 boe per day in 2019 While Investing in 25,500 boe per day Addition at Dawson Phase IV, Sanctioned to Come on Stream in Q2 2020 BC AB Red Creek Attachie…
Multi-year Infrastructure Investment Plan Projects Processing Capacity 2017 2018 2019 2020 2021 2022 Oil and Condensate (bbl/day) NGLs (bbl/day) Natural Gas (MMcf/day) Total (boe/day) Parkland-Dawson Interconnect Sunrise…
ARC Is Adding Value by Generating Strong Cash Flows and Sustaining Production at Low Reinvestment Rates 2009 Non-core Dispositions 2010 2011 2012 2013 2015 2015 2017 2018 2019 Q4 2019 Q2 2020 Q2 2020 2021 Montney Businesses ~$575…
Montney Development Economics Strong Rates of Return across the Montney Portfolio (1) IRR (half-cycle after-tax rate of return) run at US$60/bbl WTI and Cdn$2.00/GJ AECO flat pricing. (2) Breakeven prices are US$ per barrel WTI or Cdn$…
Operating Cost Management • Focused assets, characterized by high working interest, and ARC owned-and-operated facilities, provides ARC with control over costs and operations Low-cost Producers Deliver Superior Returns over Time Group…
Strong Safety Performance • ARC’s strong safety performance and capital efficiencies are the result of well-planned and executed operations • Improvements in safety performance are the result of ARC employees being focused on safety and…
Environmental, Social & Governance Performance View ARC’s 2018 Sustainability Report at www.arcresources.com/responsibility • Superior financial returns achieved through: • Risk management • Good governance practices • Maintenance…
ARC’s ESG Excellence Responsible Development Has Shaped the Company We Are Today and Underpins Our Sustainable Future Growth (1) Source: BMO Capital Markets; Yale Environmental Performance Index (EPI); Social Progress Imperative;…
Why Invest in ARC? A Differentiated Investment with Tremendous Opportunity Montney and Cardium Project Potential (boe/day) 2018 Asset Quality & Operational Excellence Total Return: Dividend & FFO per Share Profitable…
Dawson – Asset Details Focus Is on Lower Montney Liquids with Infrastructure Enhancements at Dawson Phase I & II and Dawson Phase IV (1) Reserve Life Index based on 2019 guided production. ARC 13-7 Phase III Gas Plant (90 MMcf/day &…
Lower Montney Production Success Lower Montney CGRs Range from 10 to 225 bbl/MMcf (1) Strong Liquids Results to Produce into Integrated Infrastructure of Greater Dawson Area Parkland F11-4 (12 month cum) • 124 Mbbl condensate • 1.3…
Dawson – Development Potential Liquids-rich Development Layer Below Core Acreage Lower Montney Booked Reserves Upper Montney A ARC Montney Lands with 2P Reserves Booked as of YE 2018 ARC Montney Lands Booked Reserves Phase I…
Parkland/Tower – Asset Details Greater Focus on Lower Montney Development; Profitable with Commodity Optionality Year 2017 2018 2019 Budget Parkland # Hz Wells Drilled 6 8 5 Tower # Hz Wells Drilled 29 15 8 ARC Gas Plants ARC…
Parkland/Tower – Development Potential Incremental Reserves Potential With Multi-layer Development Upper Montney A Booked Reserves Upper Montney A+ Booked Reserves Lower Montney Booked Reserves ey ves Drilling Inventory 0 200…
Sunrise/Sunset – Asset Details Sunrise Phase II: First 60 MMcf per Day of Processing Capacity in Use, Balance Expected to Be in Service in June 2019 (1) The first 60 MMcf/day of gas processing capacity is in use, and the remaining 120…
Sunrise – Development Potential Suited for Multi-layer Development Sunrise Phase I (2015) Sunrise Phase II (2018 to 2019) Drilling Inventory 0 100 200 300 400 500 Wells Drilled to YE 2018 Drilling Opportunities at YE…
Attachie Regulatory Approval Obtained for Phase I Attachie West is a leading development opportunity within ARC’s portfolio due to its: • Condensate-rich production profile • Significantly over-pressured reservoir • Extensive,…
Multi-layer Development Potential Asset Details Net Production (boe/day) – Q1 2019 3,272 Liquids (bbl/day) 1,795 Gas (MMcf/day) 8.9 Land (Montney Net Sections) 308 Working Interest ~99% 2P Reserves (MMboe) 31 Liquids (MMbbl) 14.8…
Ante Creek – Asset Details Strong Cash Flow Generating Asset with Facility Expansion Project Planned for Q2 2020 Net Production (boe/day) – Q1 2019 14,817 Liquids (bbl/day) 6,996 Gas (MMcf/day) 46.9 Production Split % (Liquids / Gas)…
Ante Creek – Development Potential Large Land Base Presents Significant Drilling Inventory Ante Creek Phase I (2012) Ante Creek Expansion (Estimated Q2 2020) Drilling Inventory 0 200 400 600 800 Wells Drilled to YE 2018…
Pembina – Asset Details High Working Interest Light Oil Production, Competitive Operating Netback and Strong Cash Flow Generation Net Production (boe/day) – Q1 2019 10,550 Liquids (bbl/day) 8,703 Gas (MMcf/day) 11.1 Land (Cardium Net…
ARC’s History and Future In the past 23 years, ARC has successfully achieved the following: Strong Foundation for Continued Success $6.4 Billion of Distributions / Dividends Stayed within Target of 1.0 to 1.5x Net Debt to Funds…
Consistent and Sustainable Strategy Delivering on Our Strategy of Risk-managed Value Creation Montney Growth Assets ARC holds ~1,100 net Montney sections (~714,000 net acres) Oil and Liquids Dry Gas Condensate-rich Gas Net Debt…
Transformation of Our Business Montney Transformation Has Allowed ARC to Manage a Profitable Business through Commodity Price Cycles 2019 YTD Payout Ratio of 29% Return on Average Capital Employed (1) Cumulative Dividends and…
ecord Produced Reserves Replacement in 2018 • Strong 2018 development 2P reserve adds, with 245 per cent of produced reserves replaced • Montney assets have been the centrepiece of ARC’s strategy of organic reserves and resource growth…
Key Reserve Information • Proved Producing 244 MMboe • Total Proved 551 MMboe • Proved plus Probable 879 MMboe • Crude and Tight Oil 98 MMbbl • NGLs 107 MMbbl • Natural Gas 4.0 Tcf • 2P Reserve Life Index (1) 17.4 years Year-end…
Risk Management Program • The fair value of ARC’s risk management contracts at March 31, 2019 was a net asset of $119.7 million Program Executed with a Long-term View (1) 2019 Forecast values based on actuals for the three months ended…
Risk Management Contract Positions March 31, 2019 (1) The prices and volumes in this table represent averages for several contracts representing different periods. The average price for the portfolio of options listed above does not have…
FINANCIAL AND OPERATIONAL HIGHLIGHTS ($ millions, except per share amounts) 2019 2018 2017 FINANCIAL Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Commodity sales from production 327.8 302.5 375.1 344.4 340.2 337.3 276.5 295.0 Per share, basic 0.93 0.86…
CAPITAL EXPENDITURES Geological and geophysical 11.9 1.3 3.4 2.1 4.0 2.5 1.8 2.0 Drilling and completions 129.2 60.5 114.2 102.6 139.1 154.8 119.3 105.9 Plant and facilities 72.3 69.6 51.2 58.8 70.0 87.2 55.5 41.6 Administrative…
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