A SUSTAINABLE CASH FLOW BUSINESS INVESTOR UPDATE NOVEMBER 2019 TSX: PNE
CORPORATE PROFILE A UNIQUE SUSTAINABLE CASH FLOW MODEL 2019 Production Guidance 19,000 19,250 Boe/d Listing TSX: PNE (4) - % natural gas 92% Market Capitalization(1)(3) 49.2 MM 2019 Capital Guidance 9.5 MM Average Daily Volume(2) 0.3…
FOCUS ON PER SHARE VALUE Predictable Cash Flow Model Low decline, low cost and low capital efficiencies form the foundation for a sustainable cash flow model EXPERIENCED MANAGEMENT Significant Insider Ownership TEAM Interests…
A UNIQUE, COUNTER-CYCLICAL STRATEGY BUILDING A CASH FLOW MODEL IN A VOLATILE COMMODITY PRICE ENVIRONMENT PNE has been uniquely focused on a low-risk, low decline, primarily natural gas asset consolidation strategy in Western Canada with…
WHAT WE HAVE BUILT THREE MAJOR OPERATED CORE AREAS 2019 Production Guidance of 19,000 19,250 Boe/d Weighted 92% towards natural gas PNE has one of the Lowest Decline Rates in the Entire Oil and Gas Sector Corporate decline rate…
LIGHT OIL POTENTIAL BOLSTERED BY MAY 2019 ACQUISITION PEKISKO AND BASAL QUARTZ LOCATIONS PROVIDE ATTRACTIVE OIL DRILLING POTENTIAL PNE currently owns approximately 283,000 gross (227,978 net) acres of land in Central Alberta that…
PEKISKO SUBCROP PRODUCTION Twining Pekisko oil field is located 135 km northeast of Calgary, AB. Pool was originally discovered in 1952 through vertical well development. The first horizontal ( 2300 m measured depth) well drilled in…
PEKISKO DEVELOPMENT Pay is associated with three zones, the lower two containing oil. Porosity is post depositional and highly complex Vertical well development and extensive coring in the area has been advantageous in defining the…
INITIAL WELL SUCCESS The 13-33 well is outperforming the estimated Cumulative Oil, Gas & NGL's: PNE Type Well and 13 PNE type well to date 333224W4 compared with Area Horizontals 100,000 Initial well had a drill, complete and…
FUTURE DRILLING OPPORTUNITIES EXTENSIVE INVENTORY OF OIL AND GAS LOCATIONS TO SUPPLY LONG TERM MODEL Summary of Undrilled Locations Total Locations (1) Booked Locations (1) Gross Net Gross Net Tier Recompletions (Viking, Mannville,…
DIVERSIFIED NATURAL GAS PRICE EXPOSURE Flexible Exposure to Multiple Pricing Points Commenced deliveries to Dawn market in November 2017 2019 Price Exposure Commenced deliveries downstream of Empress delivery point in January…
LOW CORPORATE BREAK EVEN KEY TO PNE CASH FLOW BUILT FOR SUSTAINABILITY IN A VOLATILE COMMODITY PRICE ENVIRONMENT AECO Price (/Mcf) 1.42 1.75 2.00 2.50 3.00 Realized Gas Price (/Mcf) 1.83 2.14 2.34 2.71 3.16 Oil and Gas Sales…
NATURAL GAS OUTLOOK NORTH AMERICAN SUPPLY Western Canada Natural Gas Storage U.S. & Canada Natural Gas Rig Count 2019 Operating Bcf Western 500 1000 natural gas Canadian drilling rigs in 900 CANADA gas the U.S. and storage 800 Canada…
NATURAL GAS OUTLOOK NORTH AMERICAN DEMAND Alberta Natural Gas Demand U.S. Annual LNG Export Capacity (Year End) Bcf/d Bcf/d 8 12 Committed 7 Freeport T3 LNG export Alberta 10 6 Corpus Christi T12 capacity natural gas forecast to…
NATURAL GAS OUTLOOK GLOBAL SUPPLY AND DEMAND Global Changing Dynamics of Supply and Demand for Natural Gas Tcf Global Natural Gas Demand Bcf/d Global LNG Demand Natural gas Demand for consumption LNG continues to continues to…
WHY INVEST IN PINE CLIFF Long life predictable natural gas assets with low operating costs and an industry leading decline rate creates one of the lowest cash flow break even points in the industry Demonstrated ability to generate…
APPENDIX -19-
BUILDING A FAMILIAR MODEL A CLEAR VISION FOR LONG-TERM GROWTH WITH PROVEN EXPERIENCE Pine Cliff management has a long-term view of value creation, with a counter-cyclical focus to acquire natural gas assets that are non-core to their…
AN ACTIVE EIGHT YEARS OF ACQUISITIONS TRANSACTION RECORD SINCE JANUARY 2012 500,000,000 Market Cap 11 450,000,000 Share Price 2.50 10 9 12 400,000,000 13 14 2.00 350,000,000 300,000,000 8 4 7 15 1.50 250,000,000 6 5 3…
HISTORY OF ACCRETIVE ACQUISITIONS ACQUISITION METRICS REFLECT DISCIPLINED VALUE FOCUSED STRATEGY Transaction Metrics PNE Price at Announcement Announcement Transaction Value Production P+P Reserves Flowing Barrel P+P Reserves P+P…
CENTRAL ASSETS AREA OVERVIEW PINE CLIFFS LARGEST CORE AREA Gas weighted, low decline assets in the Ghost Pine and Viking areas of Central Alberta Extensive land position of 1.3 MM gross (0.95 MM net) acres Q3 - 2019 production of…
SOUTHERN ASSETS AREA OVERVIEW LOW DECLINE, LOW COST PRODUCTION Q3 - 2019 production of 7,589 Boe/d (mostly natural gas), 40% of Pine Cliffs production 100% ownership of three CER regulated pipelines delivering gas to Montana and…
EDSON AREA OVERVIEW HIGH IMPACT INVENTORY Q3 - 2019 production of 1,699 Boe/d (71% natural gas), 9% of Pine Cliffs production Approximately 60 gross (15.1 net), high quality locations targeting the Wilrich, Bluesky, Ellerslie,…
HIGH QUALITY EDSON AREA LOCATIONS MULTI ZONE, LIQUIDS RICH LOCATIONS (1) Attractive and predictable high liquids yield production 60 gross (15.1 net) multi-zone undrilled locations of which 25 gross (6.7 net) are booked locations…
EAST SHALE BASIN DUVERNAY EMERGING LIGHT OIL RESOURCE PLAY Light Oil resource play still in the early stages of development with 22 wells drilled in 2016, 50 wells drilled in 2017, and 121 wells drilled in 2018 East Shale Basin…
RECOMPLETION PROGRAMS UPDATE Recompletion Uplift 1,600 Cumulative Production 845,000 boe/day (5.0 bcfe) 1,400 Net Raw PNE Production* 1,200 1,000 boe/day 800 600 400 200 Ghost Pine Reactivations Ghost Pine…
ACTIVELY MANAGING ENVIRONMENTAL FOOTPRINT PNE has spent 1.1 MM on abandonment and reclamation in 2019 year to date as at September 30, 2019 PNE has been an early leader in methane emissions reductions and has replaced 438 pneumatic…
RESERVE REPORT (1) Summary of Remaining Oil and Gas Reserves as of December 31, 2018 Light and Medium and Natural Gas and Natural Gas Total Oil Heavy Oil CBM Liquids Equivalent NPV 10% Gross Gross Gross Gross Reserve Category:…
ANALYST COVERAGE The following analysts provide research report coverage on Pine Cliff: COMPANY ANALYST Canaccord Genuity Anthony Petrucci Cormark Securities Inc. Amir Arif Desjardins Capital Markets Chris MacCulloch GMP/FirstEnergy…
CORPORATE INFORMATION BOARD OF DIRECTORS HEAD OFFICE WEBSITE Gary J. Drummond 850, 1015 4th Street SW www.pinecliffenergy.com George F. Fink (Chairman) Calgary, Alberta T2R 1J4 Philip B. Hodge Phone: (403) 269-2289 INVESTOR CONTACT Randy…
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