SUSTAINABLE CONVENTIONAL RESOURCE COMPANY TSX: SGY FEBRUARY, 2020
REASONS TO OWN SURGE TSX: SGY Value based with a strong focus on shareholder returns High quality conventional, large OOIP(1), light/medium gravity crude oil asset base; 86% oil & NGLs; low corporate decline of 23%; Deep 2020 value…
2020 BUDGET HIGHLIGHTS Improving sustainability and reducing debt Deliver production of 21,000 boepd in 2020 (86% light / medium oil and NGLs); Top tier production efficiencies(1)…
2020 GUIDANCE AND KEY CORPORATE ATTRIBUTES Cost effective, sustainable, low decline, crude oil production base Key Operational and Financial Attributes Large Net OOIP: 2.5 Billion barrels (6.2% cum to date recovery factor)(1)(2)…
OPERATIONS FOCUSED IN 4 CORE AREAS Large OOIP pools in established conventional reservoir trends Greater Sawn: Total: 5,000 boe/d (93% Oil & NGLs) Average Area Production Total: 21,000 boe/d (86% Oil & NGLs) Valhalla:…
TARGETING CONVENTIONAL OIL RESERVOIRS Surge focuses on high quality reservoirs at the conventional end of the permeability spectrum Recovery factors, internal rates of return (IRR)(1), decline rate, and profit to investment ratio…
NET OOIP OF 2.5 BILLION BARRELS Large OOIP, with low recovery factors - focused in conventional reservoirs SGY Net CTD(2) Total Booked Net Total Net drilling Estimated Net Oil Independent Recovery Core Area Formations Locations…
SURGES ECONOMIC INVENTORY 20% IRR 13 years of drilling US60 WTI - Average Risked IRR: 96% & PIR10: 1.22 SGY Economic Locations 20% Risked IRR 900 13 yrs 13 yrs * Risked weighted average 13 yrs 800 700 10 yrs Years of…
SPARKY A DOMINANT POSITION Applying modern technology to a prolific Western Canadian formation AB SK The Sparky is a large, well established, prolific oil producing formation in Western Canada. Surge holds a dominant land position in…
SPARKY - A DIVERSIFIED LOW RISK ASSET BASE Over 900 MMbbls of net OOIP, and 450 drilling locations 900 MMbbls of net OOIP Wainwright 450 net drilling locations (136 net booked) 160MMbbls OOIP 10 year drilling inventory Silver Lake…
EXPLOSIVE SPARKY PRODUCTION GROWTH Dominant conventional oil play provides consistent growth engine Surge Sparky Production Growth 12,000 12,000 11,000 11,000 Production (boe/d) 10,000 10,000 9,000 9,000 Top Tier Production…
2019 SPARKY DRILLING RESULTS Production results continue to outperform Managements expectations Wainwright Betty Lake Silver Macklin Lakeview Provost 24 horizontal Sparky wells drilled and on production in 2019:…
EYEHILL A CASE STUDY Increased production and cashflow over 380% in 3 years Waterflood maintains lower production decline as per Surges Divco Model YE 2015 1st Water Injection Surge Eyehill: 170 MMbbl net OOIP 65 net…
GREATER SAWN - CONCENTRATED LIGHT OIL 600 million barrels net OOIP in concentrated Slave Point reservoirs Sawn OOIP of 600 million bbls net of light oil OOIP: 200 MMbbl net (35-42 API). Development inventory of 100 net locations…
VALHALLA STACKED MULTI-ZONE POTENTIAL Multiple large OOIP light oil reservoirs provide a sustainable drilling inventory and production base 200 MMbbls of net combined OOIP on Surges Valhalla lands. Doig wells continue to be among the…
SHAUNAVON 400 MMbbl net OOIP on Surge lands in the Upper and Lower Shaunavon Average Shaunavon production for 2020 (Upper & Lower) is expected to be 2,000 bopd. Shaunavon produces 100% high netback, low decline oil. Upper…
CORPORATE SUSTAINABILITY Surge is committed to a strong Environmental, Social, and Governance program (ESG) During the last 5 years Surge has spent over 21 million for the abandonment and reclamation of wells; Surge is committed to…
CORPORATE SUSTAINABILITY Surges goal is to be a leader in Environmental, Social, and Governance (ESG) In addition to Surge's extensive annual abandonment and reclamation program, Surge also pays annually into the industry wide…
HIGH QUALITY CRUDE OIL ASSET BASE Positioned for long term sustainability Large OOIP conventional crude oil reservoirs with a current combined recovery factor of 6.2%; Average production of 21,000 boepd in 2020 (86% oil & NGLs);…
APPENDIX 21 FOOTNOTES INCLUDED IN THE BACK AS ENDNOTES
OIL HEDGING 22 All USD-denominated FOOTNOTES INCLUDED INWTI THE hedges BACK AShave been converted to CAD at a rate of 0.76 USD/CAD for the purposes of this graph. ENDNOTES
RISK MANAGEMENT / HEDGING STRATEGY The Company has an on-going, risk management / hedging program designed to lock in future cash flows to protect the Companys capital program and fund dividends. Below is a list of Surges current WTI…
RISK MANAGEMENT / HEDGING STRATEGY The Company has an on-going, risk management / hedging program designed to lock in future cash flows to protect the Companys capital program and fund dividends. Below is a list of Surges current hedging…
INTEREST RATE HEDGING & CONVERTIBLE DEBENTURE INTEREST RATE HEDGE Notional Amount Surge Type Term Surge Pays Fixed Rate Surge Pays (CAD) Receives Semi-Annual Step Up Beginning at 1.786% Fixed-to-Floating Rate Swap Feb 2018 to Feb…
2018 YEAR END RESERVES 2 Billion of Total Proved plus Probable Reserves Value (NPVBT10) 2018 Year End Reserves(1)(2) Total Proved Plus Probable reserves of 122.6 Mmboe, an Oil & NGLs Gas Total NPVBT10 Reserve Category increase of 29%…
NET ASSET VALUE High quality conventional reservoirs continue to deliver value Surges 2018 NAV TP TPP Reserve Value NPV10 BT (MM)(1) 1,318 2,054 Undeveloped Land and Seismic (MM)(2) 134 134 Net Debt (MM) (461) (461)…
ANALYST COVERAGE Financial Institution Analyst Email Address Acumen Capital Partners Trevor Reynolds treynoldsacumencapital.com BMO Capital Markets Ray Kwan ray.kwanbmo.com Canaccord Genuity Anthony Petrucci…
CORPORATE PARTNERS Advisors National Bank of Canada Bank of Nova Scotia Bank of Montreal ATB Financial Canadian Imperial Bank of Commerce Bankers Syndicate: Toronto-Dominion Bank Bank of Montreal ATB Financial HSBC Bank Canada…
NON-GAAP FINANCIAL MEASURES Certain secondary measures in this presentation namely, adjusted funds flow, net debt, all-in payout ratio, and net operating expenses are disclosed for the purpose of providing investors with additional…
NON-GAAP FINANCIAL MEASURES CONTD All-in Payout Ratio All-in payout ratio is calculated using the sum of total exploration and development capital, plus dividends paid, divided by cash flow from operating activities less payments on…
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