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February 2020 Investor Presentation – Kelt Exploration Ltd.

Kelt Exploration Ltd. · Feb 20, 2020 · 49 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. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 1
    Corporate Presentation February 2020 KeltExploration.com David J. Wilson President & Chief Executive Officer Sadiq H. Lalani Vice President & Chief Financial Officer www.keltexploration.com 0
  2. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 2
    Why Invest in Kelt VALUE CREATION OPPORTUNISTICALLY TAKING ADVANTAGE OF INDUSTRY DOWNTURNS BY ACCUMULATING RESOURCE DEVELOPMENT POTENTIAL AT HISTORICALLY LOW COSTS Kelt focuses on value creation resulting in annual growth in…
  3. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 3
    Environment, Social and Governance ( ESG ) Environment Social Governance Kelt is committed to minimalizing impacts on the Health and safety are a high priority Kelt is committed to strong environment. and Kelt maintains a HS&E program…
  4. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 4
    Capital Structure Stock Exchange listing TSX Trading symbol KEL Market capitalization 700 million Enterprise value 1.1 billion 52-week stock trading range 2.45 6.14 Common shares issued 187.8 million Stock options ( 10.0 MM ) &…
  5. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 5
    Insider Commitment Insider Purchases Offering / Market Purchases Date Shares (MM) Amount (MM) Price/share 13.9 MM Equity Private Placement Feb-2013 3.7 8.7 2.32 94.4 MM Equity Private Placement Apr-2013 5.7 31.5 5.55 92.0 MM Equity…
  6. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 6
    Capital Expenditures 2019 2020 2020/19 ( millions ) 2018 Forecast Budget Change Drilling & Completions 168.7 185.0 145.0 22% Equipment, Facilities, & Pipeline 117.7 129.0 70.0 46% Infrastructure [1] Land, Seismic & Asset…
  7. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 7
    Drilling Program 2018 2019 Forecast 2020 Budget Drills Gross / Net Wells Gross / Net Wells Gross / Net Wells Alberta 16 15.1 8 8.0 4 4.0 British Columbia 17 17.0 24 24.0 21 21.0 Total [1, 2, 3] 33 32.1 32 32.0 25 25.0 2018 2019…
  8. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 8
    Production Outlook 2019 2020 2020/19 2018 Forecast Budget Change Oil ( bbls/d ) 8,403 9,360 12,600 13,400 35% - 43% NGLs ( bbls/d ) [1] 3,186 4,490 7,000 7,600 56% - 69% Gas ( Mcf/d ) 92,502 96,660 114,000 122,000 18% - 26%…
  9. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 9
    Product Mix Production Operating Income Operating Income 2019 Forecast Split ( MM ) Split Oil & NGLs 46% 177.0 86% Gas 54% 36.0 14% Total 100% 206.0 100% Production Operating Income Operating Income 2020 Budget Split ( MM ) Split…
  10. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 10
    Commodity Prices ( CA, unless otherwise specified ) 2018 2019 Forecast 2020 Budget 2020/19 Change WTI Crude Oil ( USD/bbl ) [1] US 64.94 US 57.00 US 52.00 9% MSW Crude Oil ( CAD/bbl ) [2] 69.29 69.20 61.50 11% WTI-MSW Basis…
  11. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 11
    Gas Market Risk Management GAS MARKET DIVERSIFICATION The Company has taken a diversified approach to selling its natural gas in order to reduce exposure to single market risk. Kelt has entered into several contracts that result in…
  12. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 12
    North American Natural Gas Hubs Kelt 2020 Forecast Gas Hub Netbacks Station 2 Natural Hub Price Netback Hub Price Netback Gas % US / US / CA / CA / AECO Hub MMBtu [1] Mcf [2] MMBtu [1,3] Mcf [2,3] Sumas Empress Emerson NYMEX 2.25…
  13. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 13
    Hedging Commodity Index Term Quantity Fixed Price NYMEX to Malin Jan/2020 to NYMEX plus US 0.31625/MMBtu Natural Gas 10,000 MMBtu/d [ equivalent to CA 0.42 at Kelts 2020 forecasted Basis Differential Feb/2020 CAD/USD exchange rate of…
  14. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 14
    2020 Forecast Commodity Price Sensitivities Kelt Kelt Kelt CAD / USD 2020 Oil Price NGLs Price Gas Price Exchange Rate Forecast minus 10% minus 10% minus 10% minus 5% Kelt Oil Price ( CAD/bbl ) 60.80 54.70 10% 60.80 60.80 57.80 5%…
  15. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 15
    Netbacks 2019 2020 2020/19 ( / BOE ) 2018 Forecast Budget Change Revenue/Price 37.30 34.50 31.20 10% Realized hedging gain ( loss ) ( 0.60 ) ( 0.10 ) 0.50 Royalties ( % of revenue/price ) ( 8.3% ) ( 4.9% ) ( 6.1% ) + 24% Transportation…
  16. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 16
    Financial Outlook 2019 2020 2020/19 2018 Forecast Budget Change Revenue ( MM ) 389.3 395.0 470.0 + 19% Operating income ( MM ) [1] 202.6 206.0 252.0 + 22% Adjusted funds from operations ( MM ) [1] 186.8 182.0 225.0 + 24% Per share…
  17. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 17
    Focused on per Share Growth PRODUCTION PER MILLION SHARES ( BOE / d ) FUNDS FROM OPERATIONS PER SHARE ( diluted ) 300 1.75 CAGR Since CAGR 2013 1.50 Since 250 = 22% 2013 213 = 21% 1.25 200 1.19 163 1.00 148 106 1.01 0.99 150…
  18. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 18
    Reserves December 31 December 31 NPV 10% BT NPV 10% BT Percent 2018 2019 Dec/31/2019 Dec/31/2019 Change ( MBOE ) ( MBOE ) ( MM ) ( / BOE ) Proved Developed 40,702 48,854 + 20% 514 10.53 Producing Total Proved 158,443 224,582 +…
  19. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 19
    P+P Reserves Future Development Capital December 31, 2018 December 31, 2019 FDC Net HZ FDC Net HZ ( MM ) Wells ( MM ) Wells Alberta Montney wells 332 59 582 101 B.C. Montney wells 744 140 1,463 270 TOTAL Montney wells 1,076 199…
  20. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 20
    Finding, Development & Acquisition Costs As at December 31, 2019 Proved Proved + Probable 2019 capital expenditures + change in FDC ( M ) 822,972 1,295,973 Reserve additions, net ( MBOE ) 77,053 169,217 FD&A cost ( /BOE ) 10.68 7.66…
  21. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 21
    Operating Divisions Inga/Fireweed Montney light oil/condensate-rich gas Doig condensate-rich gas Oak/Flatrock Montney light oil/condensate-rich gas Inga/ Fireweed Oak/ Flatrock Pouce Coupe/Progress Pouce Coupe/Progress…
  22. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 22
    Kelt Land Fairway R13 R11 R9 R7 R5 R3 R1W6 R24W5 94-A-13 94-A-14 94-A-15 94-A-16 Fireweed Corporate Land Holdings T90 94-A-12 94-A-11 94-A-10 94-A-9 T88 Inga T88 [ as at January 2020 ] Flatrock T86 T86 Developed + Gross Net…
  23. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 23
    Kelt Montney Framework 22
  24. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 24
    Reserves by Operating Divisions Inga/ Pouce Coupe/ Wembley/ Other Total Fireweed Progress Pipestone Properties Company Division Division Division [2] PDP Reserves ( MBOE ) 24,107 12,354 7,622 4,771 48,854 % Oil & NGLs 47% 35% 65%…
  25. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 25
    British Columbia Montney Lands MONTNEY LAND HOLDINGS Extrapolation of previous BC Crown Land Sale Prices to Gross: 368,618 acres ( 576 sections ) Kelts Inga / Fireweed Montney Lands (139,963 acres) Net: 363,852 acres ( 569 sections )…
  26. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 26
    British Columbia Montney Wells PRODUCTION RESERVES Kelt British Columbia Montney Drills Typical Well EURs Top 10 IP30 Wells ( gross sales, BOE/d ): Inga / Fireweed Upper Montney ( UM ) (1) Inga (B5-9) 05/16-33-087-23W6 UM 2,148 ( 80%…
  27. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 27
    Inga / Fireweed Division Delineation Drilling 94-A-13 94-A-14 MONTNEY LAND HOLDINGS F A-65-I MM G 02/A-65-I UM B-90-A UM H (sfc C-10-H) E F G Gross: 141,543 acres ( 221 sections ) 03/A-65-I UM Net: 139,963 acres ( 219 sections…
  28. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 28
    Inga / Fireweed - Montney CGR (Condensate to Gas Ratio) 94-A-13 94-A-14 94-A-13 94-A-14 F G H E F G H F G H E F G H 94-A-13 94-A-14 94-A-13 94-A-14 C B A D C B A C B A D C B A 02/14-24 02/15-33 IP30 1,609 BOE IP30…
  29. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 29
    Inga / Fireweed Division Development Drilling 94-A-13 94-A-14 THE MONTNEY CUBE F G H E F G MULTIPLE STACKED MONTNEY HORIZONS 94-A-13 94-A-14 C B A D C B Fireweed 5-well Montney pad Fireweed 5-well 4 UM & 1 MM 94-A-12…
  30. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 30
    Inga 6-Section / 3-Pad / 72-Well Montney Development Plan Kelts 2019 / 2020 capital expenditures included 24 drills at Inga on the Companys first 24-well multi-layer Montney cube pad that included eight Upper, seven IBZ, eight Middle…
  31. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 31
    Inga 24-well Montney Cube Pad Initial Results Aggregate combined sales volumes from the first six wells (5-9 Group 1) for initial production of 30 days (720 operating hours) was 6,569 BOE per day (77% oil and NGLs). Aggregate combined…
  32. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 32
    Inga Gas Processing & Liquids Handling KELT FACILITY ( Inga 2-10 Facility ): The Company constructed a 100 MMcf/d compression, dehydration, liquids handling and frac water facility located at Inga which is currently in operation. The…
  33. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 33
    Oak / Flatrock Division 00/1-9 UM 00/4-10 UM MONTNEY LAND HOLDINGS (sfc 5-33) 00/14-24 UM 00/16-6 UM 00/13-5 MM 02/13-13 UM (sfc 13-12) 00/12-2 MM Gross: 206,260 acres ( 322 sections ) (sfc 5-31) (sfc 10-27) T87 Net: 204,988…
  34. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 34
    Alberta Montney Lands MONTNEY LAND HOLDINGS T80 Gross: 193,600 acres ( 303 sections ) Net: 167,674 acres ( 262 sections ) OPERATIONS Pouce Coupe Kelt commenced development of the Montney oil play at T78 Pouce Coupe with its first…
  35. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 35
    Alberta Montney Wells PRODUCTION RESERVES Kelt Alberta Montney OIL Drills Typical Well EURs Top 10 IP30 Wells ( gross sales, BOE/d ): Wembley Montney GAS Sproule 2P (1) Pouce Coupe 03/07-18-078-11W6 LMM (D1) 2,045 ( 66% oil/ngls ) EUR =…
  36. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 36
    Wembley / Pipestone / La Glace Division Upper Middle Montney MONTNEY LAND HOLDINGS Gross: 110,880 acres ( 173 sections ) Sexsmith 00/1-35 UMM Gas Plant T75 Net: 107,155 acres ( 167 sections ) (sfc 12-19) (0.3% WI) 00/13-6 UMM…
  37. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 37
    Wembley / Pipestone / La Glace Division Middle Montney Kelt 14-29 MONTNEY LAND HOLDINGS La Glace Facility (100% WI) 1-5 MM Gross: 110,880 acres ( 173 sections ) 02/13-33 MM 15-33 UM Sexsmith T75 Net: 107,155 acres ( 167 sections )…
  38. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 38
    Net Asset Value Dec/31 Dec/31 NET ASSET VALUE PER SHARE ( diluted ) ( millions ) Change 22.50 2018 2019 CAGR Since 20.00 2013 = 22% P&NG reserves, NPV10% BT 3,119.6 3,988.5 + 28% 18.78 Undeveloped land 279.7 350.6 + 25% 17.50 Net…
  39. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 39
    Future Considerations The Company has numerous potential future drilling opportunities on its existing lands that will provide for continued growth in the years to come. The Company has amassed vast Montney acreage in new plays to…
  40. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 40
    Appendix Convertible Debentures Quarterly Oil & Gas Prices 2018/2019 Actual & 2020 Forecast Environment, Social and Governance ( ESG ) Board of Directors Management Abbreviations Disclaimers 39
  41. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 41
    Convertible Debentures TSX trading symbol KEL.DB Principal amount issued 90.00 million Principal amount outstanding 89.91 million Coupon / Maturity date 5.0% / May 31, 2021 52-week trading range 98.15 132.00 D&Os purchased 14.7…
  42. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 42
    Kelts 2020 Oil Price Forecast ( CA/bbl ) ( US/bbl ) 100.00 100.00 KELT Realized WTI ( 2019 Forecast = CA67.00 ) ( 2019 Forecast = US57.00 ) 90.00 ( 2020 Forecast = CA60.80 ) ( 2020 Forecast = US52.00 ) 90.00 80.56 80.62 80.00…
  43. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 43
    Kelts 2019 / 2020 Gas Price Forecast ( CA/Mcf ) ( US/MMBtu ) KELT Realized NYMEX Henry Hub 8.00 ( 2019 Forecast = CA3.25 ) ( 2019 Forecast = US2.62 ) 8.00 ( 2020 Forecast = CA2.50 ) ( 2020 Forecast = US2.25 ) 7.00 7.00 6.37 6.00…
  44. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 44
    Environment, Social & Governance ( ESG ) Health & Safety Safety is paramount in Kelts corporate culture. The Company is committed to safe and environmentally responsible operations for the benefit of its employees, contractors and the…
  45. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 45
    Environment, Social & Governance ( ESG ) Air Quality Kelts air emission roadmap is focused on continuous improvement to meet provincial and federal standards. Kelts emissions management framework includes air monitoring, utilizing…
  46. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 46
    Environment, Social & Governance ( ESG ) Corporate Governance The following documents relating to the Companys corporate governance matters are available on the internet at www.keltexploration.com: Advance Notice Policy Disclosure,…
  47. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 47
    Board of Directors Robert J. Dales [2, 3, 4, 7] Geri L. Greenall [2, 3, 6] William C. Guinan [1,5] President, Valhalla Ventures Inc. Chief Financial Officer, Partner, Borden Ladner Gervais LLP Chief Compliance Officer & Portfolio…
  48. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 48
    Management David David J. Wilson Sadiq H. Lalani Douglas J. Errico Alan G. Franks Bruce D. Gigg President & Chief Executive Officer Vice President & Chief Financial Officer Vice President, Land Vice President, Production Vice…
  49. February 2020 Investor Presentation – Kelt Exploration Ltd. – slide 49
    Corporate Presentation KeltExploration.com Kelt Exploration Ltd. Suite 300, East Tower 311 Sixth Avenue SW Calgary, Alberta Canada T2P 3H2 Phone: 403-294-0154 Fax: 403-291-0155 Website: www.KeltExploration.com 56

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