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January 2020 Corporate Presentation – Whitecap Resources Inc.

Whitecap Resources Inc. · Jan 29, 2020 · 41 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 1
    CORPORATE PRESENTATION / JANUARY 2020 SUSTAINABLE GROWTH AND FREE FUNDS FLOW
  2. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 2
    Whitecap Profile TSX: WCP Shares outstanding (MM) Basic 409.6 Fully diluted (1.8% dilutives) 417.1 Market capitalization (B) 2.3 Enterprise value (B) 3.5 2020 production guidance (boe/d) 71,000 72,000 % oil + NGLs 85% 2020…
  3. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 3
    Sustainable Business Focused on Shareholder Returns Top Tier Light Oil Asset Base Sustainability High funds flow netbacks Safety is a core to our culture Long life and lower declines Leaders in ESG performance Strong capital…
  4. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 4
    Disciplined Capital Allocation 2020 Objectives Continue to strengthen balance sheet Reduced net debt 100 million in 2019 and target 100 million in 2020 Grow debt-adjusted production per share 5% or greater Expand core operating…
  5. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 5
    Focused on Free Funds Flow 2019 Forecast 2020 Budget % Change Average production (boe/d) 71,000 71,500 1% - per debt adjusted share 178 186 5% Funds flow netback (/boe) 25.80 26.00 1% Funds flow (MM) 669 680 2% Capital…
  6. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 6
    2020 WTI Price Sensitivities Oil (USWTI) 55.00 60.00 65.00 FX (C/US) 0.76 0.77 0.78 Oil (Cdn/WTI) 72.37 77.92 83.33 AECO (C/GJ) 1.75 1.75 1.75 Funds flow netback (/boe) 23.00 26.00 28.80 Funds flow (MM) 602 680 754 Development…
  7. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 7
    Strong Balance Sheet Total Debt Capacity 1.77B Net Debt 1.10B Average Cost of Debt 3.6% Attractive long-term debt with no near-term maturities Amount Type 1 Rate Maturity date 200 MM Bank - Fixed 3.25% 2024 200 MM Sr. Notes -…
  8. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 8
    Commodity Price Risk Mitigation Objectives: Mitigate price volatility and protect economic returns Target 40 to 60% of net royalty volumes hedged 12 months forward Target 20 to 40% of net royalty volumes hedged 12 24 months…
  9. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 9
    Core Areas of Operations Light Oil Drilling Inventory 2,827 8 - 10 years of inventory BRITISH COLUMBIA ALBERTA Drilling Wells SASKATCHEWAN Inventory 2019 2020 West Central Sask 813 95 75 Northwest Alberta & BC Southwest Sask…
  10. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 10
    Capital Allocation Business Unit Target (MM) % Southeast Sask CO2 Flood 65 18 Southwest Sask Atlas/Shaunavon 65 18 West Central Sask Viking 85 23 Northwest Alberta & BC Cardium 100 27 West Central Alberta Cardium 48 13…
  11. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 11
    Sustainable Growth Assets: Capital + Dividend < Funds Flow Self Funded Business Units 220 200 173 180 166 160 160 152 140 52 118 Millions 120 108 75 101 100 80 70 60 100 40 85 65 65 20 48 0 Southeast Sask…
  12. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 12
    Internally Funded Income and Growth Model NO DRIP 98 Total Payout Ratio 125% 93 100 90 100% 80 65 70 60 57 Total Payout Ratio 75% 60 WTI (US/bbl) 51 49 43 50 50% 40 30 25% 20 10 0% - 2013 2014 2015…
  13. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 13
    Per Share Growth Focus 80,000 Production 600,000 2P Reserves 72,000 64,000 500,000 71,500 56,000 489,451 400,000 48,000 boe/d Mboe 40,000 300,000 32,000 24,000 200,000 16,000 100,000 8,000 - 0 2010 2011 2012…
  14. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 14
    Returning Value to Shareholders 6% 0.0285 73 million 968 million Q2/19 dividend Monthly dividend Share repurchases completed Total dividends paid increase (as at Dec 31, 2019) (3.37/share) Total Dividends Total Share Buybacks…
  15. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 15
    Karr Montney JV Oil Rich Resource Opportunity Montney Inventory Expansion Pay 100% on 2 drills and 1 completion to earn 34 (21.5 net) Montney sections Potential for 144 (84.2 net) drilling locations (30,000 boe/d) upside 65%…
  16. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 16
    Opportunistic Acquisition SW Saskatchewan (2016) 180,000 Free Funds Flow (FFF) 160,000 140,000 120,000 100,000 50 Years FFF Thousands Totalling 2.4B 80,000 60,000 40,000 20,000 - 1 2 3 4 5 6 7 8 9 10 11 12 13…
  17. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 17
    Opportunistic Acquisition SE Saskatchewan (2017) 200,000 Free Funds Flow (FFF) 150,000 42 Years FFF Totalling 3.9B Thousands 100,000 50,000 - 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27…
  18. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 18
    Environmental Sustainability Weyburn Carbon Capture Internationally Recognized Project: Largest Carbon Capture & Utilization Storage (CCUS) project in the world CO2 injection commenced in October 2000 Have safely captured and stored…
  19. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 19
    Environmental Sustainability 2018 CO2 Emission & Sequestration 2,000,000 1,500,000 Indirect Emissions Weyburn asset is the largest 534,000 1,000,000 CO2 capture and sequesterer Direct for oil and gas sector in the 500,000…
  20. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 20
    IRR 50% 0% 100% 150% 200% 250% Atlas Hz 1.0 (Unconvent'l) Viking ERH 1.5 Refer to slide Notes and Advisories. Wapiti Cardium Standard 1.0 W. Pembina ERH 1.5 Rate of Return Viking Standard 1.0 W.…
  21. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 21
    Depth and Quality of Inventory for Organic Growth Profit to Investment Ratio 2.5 2.0 Historically, inventory expanded through high quality acquisitions Profit to Investment Ratio Average Average == 1.4 1.4 1.5 Focus…
  22. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 22
    Crude Oil Marketing Active seller and shipper on 6 oil feeder PL connected to Enbridge mainline 33% of production is protected from Enbridge apportionment rail and Midale - Light Oil direct sales to refineries Price…
  23. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 23
    Research Coverage BMO Capital Markets National Bank Financial Canaccord Genuity Peters & Co. CIBC World Markets Raymond James Cormark Securities RBC Capital Markets Desjardins Capital Markets Scotiabank Global Eight Capital STIFEL…
  24. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 24
    TSX:WCP www.wcap.ca January 14, 2020 24
  25. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 25
    Appendix Asset Overview 25
  26. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 26
    Northwest Alberta (Deep Basin) Core Growth Asset Asset Summary Depth 1,400 2,700 m Large defined oil-in-place Oil Quality / Benchmark 32o - 39o API / MSW High-quality, short cycle projects Multiple expansion and growth DOIIP…
  27. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 27
    Wapiti Cardium Standard Length 3,500 Net operating income (NOI) 3,000 2,500 2,000 Capital payout < 1 Year Thousands 1,500 1,000 35 Years NOI 500 Totalling 14.4MM 0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35…
  28. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 28
    Dunvegan Standard Length Net operating income (NOI) 2,500 2,000 1,500 Capital payout < 1 .5 Years Thousands 1,000 32 Years NOI Totalling 8.3MM 500 0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 Year MM US50 US55…
  29. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 29
    West Central Saskatchewan Core Growth Asset Asset Summary Depth 700 m High ROR and short capital payout projects Oil Quality / Benchmark 36o API / MSW Industry leading capital efficiencies DOIIP (Bbbls) 1.3 (1.1 net) Reduced…
  30. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 30
    Viking Standard Length 800 Net operating income (NOI) 700 600 500 Capital payout < 1 Year Thousands 400 300 16 Years NOI 200 Totalling 1.6MM 100 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Year MM US50 US55 US60…
  31. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 31
    West Central Alberta Stable and Predictable Asset Summary Depth 1,300 2,300 m Large oil-in-place and low risk development Oil Quality / Benchmark 39o API / MSW Underdeveloped enhanced oil recovery projects DOIIP (Bbbls) 1.6…
  32. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 32
    West Pembina Cardium Standard Length Net operating income (NOI) 2,500 2,000 1,500 Capital payout < 1.5 Years Thousands 1,000 39 Years NOI 500 Totalling 12.4MM 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36…
  33. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 33
    Southwest Saskatchewan Sustainable Free Funds Flow Asset Summary Depth 900 1,200 m Large defined oil-in-place in multiple horizons Oil Quality / Benchmark 22o API / FOS Enhanced oil recovery opportunities DOIIP (Bbbls) 3.3 (1.9…
  34. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 34
    SW Saskatchewan Atlas Net operating income (NOI) 1,600 1,400 1,200 1,000 Capital payout < 1 Year Thousands 800 600 37 Years NOI 400 Totalling 5.9MM 200 0 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37…
  35. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 35
    SW Saskatchewan Upper Shaunavon Net operating income (NOI) 1,400 1,200 1,000 800 Capital payout < 1.5 Years Thousands 600 400 37 Years NOI 200 Totalling 5.1MM 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36…
  36. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 36
    Southeast Saskatchewan Free Funds Flow Engine Asset Summary Depth 1,400 m Opportunities to optimize and expand CO2 flood Oil Quality / Benchmark 36o API / Midale Reserve life 40 years Generates 100MM excess cash flow DOIIP…
  37. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 37
    Southeast Saskatchewan Net operating income (NOI) 900 800 700 Capital payout < 4.5 Years 600 500 Thousands 400 37 Years NOI 300 Totalling 13.1MM 200 100 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22…
  38. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 38
    Slide Notes (contd) Slide 17 1. Free funds flow is calculated as net operating income less capital expenditures. 2. Free funds flow to December 2019 is based on actuals from the date of acquisition to December 31, 2018 and estimates for…
  39. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 39
    Slide Notes (contd) Slide 30 1. Net operating income is based on: WTI US50.00/bbl, US55.00/bbl or US60.00/bbl; C/US0.75 and AECO C1.75/GJ all escalated by 2%/annum; MSW Differential US- 8.00/bbl; and WCS Differential US-17.00/bbl. 2.…
  40. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 40
    Advisories (contd) The assumptions used for the 2019 forecast and 2020 budget funds flow netbacks (/boe) used on slides 2 and 6 of this presentation are as follows: 2019 Forecast 2020 Budget Petroleum and natural gas revenues 54.82…
  41. January 2020 Corporate Presentation – Whitecap Resources Inc. – slide 41
    Advisories (contd) Drilling Locations This presentation also discloses drilling inventory in three categories: (i) proved locations; (ii) probable locations and (iii) unbooked locations. Proved locations and probable locations are…

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