Corporate Profile ARC Is a Canadian Oil and Gas Producer in Its 23rd Year of Delivering on Its Disciplined, Returns-focused Value Proposition, Including over $6.5 Billion in Dividends Paid since Inception Corporate Summary Asset…
orporate Strategy ARC’s Strategy Is Focused on Long-term Profitability RISKMANAGED VALUE CREATION HIGH-QUALITY ASSETS & OPERATIONAL EXCELLENCE FINANCIAL SUSTAINABILITY & RETURN ON INVESTMENT HIGH PERFORMANCE PEOPLE &…
Long-term Corporate Profitability ARC Has Delivered a 10% ROACE since Inception (1) Non-GAAP measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other…
Current Capital Allocation Priorities ARC Expects to Generate Funds from Operations That Will Fully Fund Its Dividend and All Capital Requirements in 2020 2019 Forecasted Capital Allocation 2020 Forecasted Capital Allocation Net Debt…
Longer-term Capital Allocation Priorities & Principles ARC Has a Disciplined Approach to Capital Allocation to Maximize Shareholder Value Dividend $212 million per year Three-year Average Sustaining Capital (1) ~$400 million per…
Capital Expenditures and Production Profiles ARC Is Moving Towards a Larger Production Base with Lower Capital Requirements Capital Expenditures ($ millions) (1) Production (Mboe/day) (2) 123 133 139 158 2017 2018 2019F 2020F…
2020 Guidance Reducing Capital Expenditures by 29% and Delivering 14% Increase in Production $500 million Invest to keep facilities at or near gas capacity while maximizing liquids production and cash flow generation Allowing ARC…
2020 Budget of $500 Million Completion of Dawson Phase IV Will Grow Profitable Production and Help Deliver Annual Production of 155,000 to 161,000 boe per day BC AB Attachie $30MM 5,000 boe/day Optimize pad profitability with…
Maintaining Financial Strength ARC Has One of the Strongest Balance Sheets in the Sector with a Targeted Net Debt to Annualized Funds from Operations Ratio of 1.0 to 1.5x ARC ARC (1) Source: RBC Research. Consensus estimates as per…
Multiple Layers to Develop Up to 1,000 Feet Thick, ARC’s Montney Assets Have Significant Future Delineation Opportunities
Top-tier Montney Economics Strong Rates of Return across the Montney Portfolio Montney Liquids Break-evens (US$/bbl) (1) Montney Natural Gas Break-evens (Cdn$/Mcf) (1)(4) 2019 YTD Average Realized Natural Gas Price: $2.04/Mcf 120% 75%…
Cost Management & Decline Rate Low-cost Producers with a Low Decline Rate Deliver Superior Returns over Time Group Average ARC Dawson ARC ARC Group Average ARC Sunrise Gas ARC Dawson (4) ARC NE BC Oil & Gas ARC Sunrise Gas ARC…
Oil & Liquids Financial and Physical Price Management 61% of ARC’s 2019 YTD Commodity Sales from Production Was Derived from Crude Oil and Liquids 77% of ARC’s liquids production is made up of light oil and condensate Crude Oil &…
Natural Gas Financial and Physical Price Management Integrated Physical Marketing and Financial Risk Management Strategies Enable ARC to Effectively Execute on Its Long-term Plans Natural Gas Flows and Sales Points (2019 YTD in…
Environmental, Social, and Governance Excellence Responsible Development Is Engrained in ARC’s Long-term Strategy and Has Shaped the Company We Are Today (1) Source: BMO Capital Markets; Yale Environmental Performance Index (EPI);…
Responsible Environmental Practices • Consistent reductions in GHG emissions intensity due to facility and multi-well pad electrification projects • GHG emissions intensity reduced by 17 per cent and absolute GHG emissions reduced by…
Strong Safety Performance • Strong safety performance is the result of well-planned and executed operations and alignment with strong service providers Zero Lost-time Incidents (“LTI”) for Employees and Contractors in 2018; Nearly Six…
Owned-and-operated Infrastructure ARC Is Building Sustainable Businesses in the Montney and Is Increasing Its Liquids Processing Capacity Multi-year Investment Plan Existing Infrastructure 2018 to 2019 Q4 2019 Q2 2020 Q2 2020 Sunrise…
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) Dawson Phase IV (1) 7,500 3,000 90…
Dawson Phase IV Business Model Infrastructure Investment in Greater Dawson Area Is Supporting ARC’s Broad Shift to the Liquids-rich Lower Montney Dawson Phase IV (1) Non-GAAP measure that does not have any standardized meaning under…
Resource Potential and Scalability ARC has: • ~1,000 net Montney sections (~671,000 acres) • Over 3,500 future drilling locations identified across the Montney • Commodity, geographic, and multi-layer optionality Scalability Allows…
Greater Dawson Area Overview Lower Montney Focus with Dawson Phase IV and Infrastructure Enhancements at Dawson Phase I & II and Parkland Snapshot Development Plan 2020 Development Focus Infrastructure Build-out 2010 2011 2013 2015…
Lower Montney Production Success Strong Liquids Results to Produce into Integrated Infrastructure of Greater Dawson Area Parkland Dawson Free Condensate-to-gas Ratio (bbl/MMcf) • High free condensate-to-gas ratio (“CGR”) in Parkland…
Ante Creek Overview Strong Cash Flow Generating Asset with Facility’s Oil Expansion Project Planned for Q2 2020 Snapshot Ante Creek Phase I Montney Crude Oil & Liquids Processing Capacity Montney Natural Gas Processing Capacity…
Attachie Overview Four Wells Completed in Q3 2019 with Initial Production Expected in Q4 2019 Snapshot Attachie West Phase I $30 million (6%) 0 wells (0%) 5 Mboe/day (3%) Development Plan 2020 Development Focus Infrastructure…
Sunrise Overview Final 60 MMcf per Day in Service at Sunrise Phase II Expect Operating Area’s Operating Expense to Be Less Than $0.30 per Mcf Snapshot Sunrise Phase I Montney Natural Gas Processing Capacity Sunrise Phase II…
Pembina Overview High Working Interest Light Oil Production, Competitive Operating Netback and Strong Cash Flow Generation Snapshot $11 million (2%) 0 wells (0%) 10 Mboe/day (6%) Development Plan 2020 Development Focus • Manage…
2019 & 2020 Guidance Moving Towards a Larger Production Base with Lower Capital Requirements 2019 Guidance 2019 YTD Actuals 2020 Guidance Production Crude oil and condensate (bbl/day) 26,000 - 30,000 27,535 27,000 - 31,000…
2019 Budget of $700 Million Delivers Annual Production of 136,000 to 142,000 boe per day in 2019 While Investing in Infrastructure at Dawson Phase IV, Planned to Come on Stream in Q2 2020 BC AB Red Creek Attachie Septimus Tower…
Asset Details Dawson Parkland/Tower Ante Creek Attachie Sunrise Pembina Net production – Q3 2019 Crude oil & liquids (bbl/day) Natural gas (MMcf/day) Total (boe/day) 3,868 207.9 38,513 14,389 127.4 35,624 7,458 44.8 14,919…
Transformation of ARC’s Business Montney Transformation Has Allowed ARC to Manage a Profitable Business through Commodity Price Cycles Production Net Debt to Funds from Operations (1) Dividends (2) (1) 2019 YTD based on annualized…
Record Produced Reserves Replacement in 2018 • Strong 2018 development 2P reserve adds, with 245 per cent of produced reserves replaced • Finding and development costs of $5.76/boe for proved plus probable reserves and $6.02/boe for…
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…
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…
Risk Management Program Program Executed with a Long-term View; Fair Value of Risk Management Contracts Is a Net Asset of $73.7 Million (4) (1) 2019 Forecast values based on actuals for the nine months ended September 30, 2019 and…
Risk Management Contract Positions at Sept. 30, 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…
FINANCIAL AND OPERATIONAL HIGHLIGHTS (1) Refer to the \"Capital Management\" note in ARC’s financial statements and to the sections entitled, \"Funds from Operations\" and “Capitalization, Financial Resources and Liquidity” contained…
CAPITAL EXPENDITURES Geological and geophysical 2.7 1.3 11.9 1.3 3.4 2.1 4.0 2.5 Drilling and completions 98.6 107.0 129.2 60.5 114.2 102.6 139.1 154.8 Plant and facilities 60.0 65.5 72.3 69.6 51.2 58.8 70.0 87.2 Corporate assets 0.6…
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