Highlights Gear Energy (GXE.TO) is an 88% liquids weighted junior oil company with: Competitive Financials 24.34/boe 2019 Funds From Operations (FFO) Third best 2019 FFO/boe within public peer group 32.26/boe in Q2 2020 (boosted by…
Top Tier Benchmarking GXE 24.34 GXE 1.1X (1) All peer data calculated internally from published 2019 financial reports. Peer group includes 25 publicly listed Canadian energy companies; AAV, ATH, BIR, BNE, BNP, CJ, CR, DEE, IPO,…
Core Areas Lloydminster Lloydminster 62% of corporate production Heavy/Medium Oil low cost horizontal cold-flow 3,800 boe/d heavy and medium oil from multiple Mannville formations Central Alberta Central Alberta 26% of corporate…
Financial Strength Reduced outstanding net debt by 24% through Forecast 2019 while maintaining stable production Exited 2019 with net debt of 69.8MM and an annual net debt to FFO ratio of 1.1x, second best result in the peer group…
2020 Plan The Original 50 MM budget was reduced to 14 MM to better reflect current oil prices The primary goal for the foreseeable future is to protect and continue to improve the strength of the balance sheet With recent price weakness,…
Production Summary Second quarter production was materially curtailed to minimize operating losses and maximize the long-term value of reserves Production is forecast to resume in August Annualized 2020 base production…
Pricing Sensitivity The 2020 budget is estimated to deliver the following results if WTI oil prices average the displayed flat prices from Aug to Dec 2020 (using actual prices Jan 1 to July 31 and the impacts of current risk management…
Drilling Inventory Future growth potential across the three core areas Lloydminster MLU Lloydminster SLL Core Areas SE Saskatchewan Central Alberta Multi-lateral unlined Single leg lined Wildmere, Lindbergh, Paradise, Frenchmans…
Lloydminster Future inventory of 306 heavy and medium oil multi-lateral unlined (MLU) horizontal Paradise wells and single-leg lined (SLL) horizontal wells Lindbergh Successfully drilled 9 wells in Q1 2020; 2 MLU Lindbergh wells, 5…
SE Saskatchewan GXE Drills to date Torquay two-mile 2019/20 Peer drills Capital 3,350k IP365 130 bbl/d EUR 120 mbbls Future inventory of 60 horizontal light oil locations in the Torquay 2019 drilling program included 5 wells; 4…
Central Alberta Central Well Capital 2,265k IP365 170 boe/d EUR 155 mboe Wilson Creek Future inventory of 34 horizontal light oil wells in Wilson Creek Belly River and Ferrier Cardium Waterfloods continue to be expanded and…
Low Costs Forecasting over 35%% reduction in estimated 2020 total costs per unit (Compared to 2014) Accomplished by continuing to lower debt balances, utilizing a low compensation structure and focusing production operations on…
Oil Marketing Oil prices have partially recovered from the unprecedented lows of April 2020, however future estimated differentials remain wider than the current spot market Having three core areas with distinct pricing…
Hedging Gear traditionally pursues regular methodical contracts targeting the protection of approximately 50% of budgeted corporate production, net of royalties For 2020, Gear has 3,200 bb/d of oil hedged at competitive prices. This…
History Gear has all the ingredients for future value growth: Strong balance sheet, Deep inventory of opportunities, low costs and a proven history of execution Charts compiled using forward strip pricing as at September 1, 2020 and…
Gear Team Management Role Prior Experience Ingram Gillmore President & CEO, Director VP Engineering ARC Resources, Talisman Yvan Chretien VP Land VP Land ARC Resources, CNRL Bryan Dozzi VP Engineering VP Business Development Rock Energy…
Research Coverage Firm Analyst ATB Capital Markets Patrick ORourke Beacon Securities Limited Kirk Wilson Cormark Securities Inc. Garett Ursu Stifel FirstEnergy Bob Fitzmartyn Peters & Co. Ltd. Dan Grager 18
APPENDIX: Economic Assumptions Economics using flat WTI oil prices at US40, 50 and 60 per barrel, fx of 0.735 /, WCS differential of 30%, MSW differential of 13% and LSB differential of 16%, all in relation to WTI. Price discounts to…
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