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Corporate Presentation December 2020 – Vermilion Energy Inc.

Vermilion Energy Inc. · Dec 1, 2020 · 39 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. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 1
    DECEMBER 2020 VERMILION ENERGY INVESTOR PRESENTATION INTERNATIONALLY DIVERSIFIED FREE CASH FLOW FOCUSED ESG LEADERSHIP
  2. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 2
    VERMILIONS KEY ATTRIBUTES Unique portfolio of internationally diversified, highly efficient conventional oil and gas assets ideally suited to support a growth-and-income capital markets model o Paid out over 40 per share of dividends…
  3. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 3
    RE-FOCUSING ON VERMILIONS CORE BUSINESS PRINCIPLES Maintain a strong balance sheet with low financial leverage o Targeting a Debt-to-Cash Flow ratio of less than 1.5x Manage total payout ratio at less than 100% o Reduced cash…
  4. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 4
    ESG LEADERSHIP We are committed to Environmental, Social and Governance matters Environmental Social Governance We reduce environmental impacts of We are committed to the care of our We demonstrate strong corporate traditional…
  5. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 5
    ESG PERFORMANCE Vermilion demonstrates strong corporate governance, with leadership that sets an example of the highest standards of ethics and integrity and a commitment to the responsible development of our diverse resource…
  6. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 6
    INTERNATIONAL DIVERSIFICATION 6
  7. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 7
    CORE OPERATING AREAS 2020E PRODUCTION* EUR 27% N.A. AUS 68% 5% EUR 32% FFO* N.A. 56% AUS 12% VERMILION IS FOCUSED IN THREE STABLE REGIONS * Company estimates as at November 23, 2020. 2020 FFO estimate…
  8. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 8
    GLOBAL COMMODITY DIVERSIFICATION PRODUCTION (2020E)* ESTIMATED FFO CONTRIBUTION (2020E)* OIL (BRENT) OIL (BRENT) 15% EUROPEAN GAS 24% 17% OIL / OIL / EUROPEAN GAS CONDENSATE / CONDENSATE / 20% NGL NORTH AMERICAN NGL (WTI)…
  9. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 9
    GLOBAL CRUDE OIL PRICING ADVANTAGE OIL BENCHMARKS Vermilion has significant leverage to oil prices Q3 2020 VET Premium o An increase of US1/bbl generates approximately 2020E VET / (Discount) to WTI 20MM of incremental FCF Crude…
  10. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 10
    EUROPEAN NATURAL GAS PRICING Vermilion has significant leverage to improving European natural gas GLOBAL NATURAL GAS PRICES prices (+1/mmbtu = +30MM incremental FCF) 14 European natural gas forward prices are currently in the 6 to…
  11. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 11
    FOCUS ON PROFITABILITY 11
  12. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 12
    RETURN ON AVERAGE CAPITAL EMPLOYED RETURN ON AVERAGE CAPITAL EMPLOYED (ROACE) 40% 35% 30% 25% ROACE (%)* 20% 15% 10% 5% 0% -5% 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010…
  13. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 13
    RELATIVE PDP RECYCLE RATIO 3-YEAR PROVED DEVELOPED PRODUCING (PDP) FD&A RECYCLE RATIOS* 2.5x 2.0x 1.5x 1.0x 0.5x 0.0x VET YGR WCP BIR TOG CR ERF ARX NVA GXE CPG IPO BTE TOU PONY TVE VII KEL LXE HIGH NETBACKS AND…
  14. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 14
    COST REDUCTION OPERATING EFFICIENCY ORGANIC CAPITAL EFFICIENCY 14.00 35.00 8% Reduction 12.00 30.00 67% Reduction 10.00 25.00 8.00 20.00 / BOE 24% Reduction / BOE from 2014 Peak 6.00 15.00 52% Reduction 15%…
  15. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 15
    FREE CASH FLOW FREE CASH FLOW GENERATION 1,000 A 10% increase in global commodity prices would 900 generate approximately 800 100MM of incremental FCF** 700 600 MM* 500 FCF = 400 FFO less 300 CAPEX 200 100 0 2016…
  16. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 16
    RELATIVE VALUATION SHARE PRICE AS A PERCENTAGE OF BLOW-DOWN NET ASSET VALUE 150% SHARE PRICE / NAV PER SHARE (%)* 125% 100% 75% 50% 25% 0% PEY PXT POU VET VII TOU ARX CPG WCP BIR CNQ ERF SU IMO VERMILION TRADES…
  17. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 17
    SUMMARY Unique portfolio of internationally diversified, highly efficient conventional oil and gas assets ideally suited to support a growth-and-income capital markets model o Paid out over 40 per share of dividends since 2003 Long…
  18. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 18
    BALANCE SHEET 18
  19. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 19
    BALANCE SHEET COMPOSITION CURRENT CREDIT CAPACITY C2.5 BILLION No near-term maturities AS AT SEPTEMBER 30, 2020 o Covenant-based credit facility termed out to May 2024 o US Senior Notes termed out to March 2025 0.4 B Vermilions…
  20. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 20
    FINANCIAL LEVERAGE LEVERAGE RATIOS 4.0x 3.0x 2.0x VERMILION TARGETED LEVERAGE RANGE 1.0x 0.0x 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017…
  21. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 21
    ASSET OVERVIEW 21
  22. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 22
    VERMILION PRODUCTION 105,000 90,000 75,000 60,000 BOE/D 45,000 30,000 15,000 0 2003 2004 2005 2006 2007 2008 2009* 2010* 2011* 2012* 2013* 2014* 2015* 2016 2017 2018 2019 2020E E&D CAPEX AS % OF FFO** 50% 36% 40%…
  23. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 23
    EUROPEAN CORE AREA NETHERLANDS GERMANY 2 onshore gas producer Established production operations and IRELAND Large and growing inventory of drilling opportunities substantial exploratory land position in 20% operated interest in the…
  24. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 24
    CEE EXPLORATION POTENTIAL VERMILION HAS BUILT A HIGHLY PROSPECTIVE EXPLORATION PORTFOLIO ACROSS CEE Approximately 3.8 million acres of undeveloped land across four countries (Hungary, Croatia, Slovakia and Ukraine) Focused on…
  25. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 25
    NORTH AMERICA CANADA Targeting light oil and condensate-rich natural gas in West Central Alberta and light oil in SE Saskatchewan Over 400,000 net acres in West Pembina targeting the Mannville (2,400 2,700m depth) and Cardium…
  26. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 26
    ATAX IRR (%) 20% 40% 60% 80% 0% 100% Ellerslie Frobisher/Alida Marten Hills Montney Montney Montney Eagle Ford Eagle Ford Condy Marcellus Viking Montney Cantuar Mannville Ellerslie Charlie Lake Montney…
  27. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 27
    AUSTRALIA 100% operated interest in Wandoo, an offshore oil field approximately 80 km N.W. of Australia (55m water depth) Horizontal well development with 20 producing wellbores and five dual lateral sidetracks tied into two…
  28. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 28
    SUPPLEMENTAL INFORMATION 28
  29. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 29
    CAPITAL MARKETS SUMMARY Market Summary Trading Price (November 30, 2020) 5.21 (TSX), 4.01 (NYSE) Ticker Symbol (TSX & NYSE) VET Shares Outstanding (September 30, 2020) 158.3 million Average Daily Trading Volume (shares) 2.4 million…
  30. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 30
    2020 RESULTS TO-DATE 2020 Q3 2020 YTD 2020 Guidance Average Production boe/d 94,000 96,000 95,471 97,656 % Crude oil, condensate and NGLs % 55% 55% 55% % Natural gas % 45% 45% 45% Capital Expenditures MM 350 370 31 307…
  31. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 31
    FFO SENSITIVITY COMMODITY PRICES** ANNUAL 2020 UNHEDGED FFO SENSITIVITY (CMM)* 2020E Change FFO Impact (C) Brent (US/bbl) 41.13 WTI & Brent US1/bbl 20.1MM WTI (US/bbl) 38.96 LSB = WTI less (US/bbl) 5.27 LSB / WTI Differential…
  32. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 32
    COMMODITY HEDGE POSITION 2020 2021** 100% 100% PERCENTAGE OF PRODUCTION HEDGED (%) PERCENTAGE OF PRODUCTION HEDGED (%) 90% 90% 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% WTI Brent European…
  33. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 33
    EUROPEAN NATURAL GAS LONG TERM OUTLOOK Global Gas Trade to 2035: European Import Dependence Grows Declining European domestic production results in higher Net imports (bcf/d) As % share of demand dependence on imports 2018 2025 2030…
  34. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 34
    ENVIRONMENTAL SUSTAINABILITY We are playing a meaningful role in the energy transition by reducing the environmental impact of our traditional energy production and developing renewable energy projects o We deploy energy and…
  35. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 35
    ENVIRONMENTAL PERFORMANCE CDP (FORMERLY CARBON DISCLOSURE PROJECT) CDP is an international environmental organization that collects data about carbon emissions and energy use; its rankings are based on emissions disclosure and…
  36. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 36
    SOCIAL PERFORMANCE Committed to the care of our people and the enrichment of the communities where we live and work Give back through strategic community investment o In the past five years, Vermilion has invested more than 9.2…
  37. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 37
    PARENTIS SUSTAINABILITY PARTNERSHIP Vermilion was the recipient of Frances Circular Economy Award for our project to supply geothermal heat from our oil operation to local greenhouses The award recognizes economically successful…
  38. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 38
    LA TESTE ECO-NEIGHBOURHOOD Our operations in La Teste, France now support an eco-neighborhood of 550 homes that are heated the same way as the tomato greenhouses, using recycled geothermal energy from our oil operation 30-year…
  39. Corporate Presentation December 2020 – Vermilion Energy Inc. – slide 39
    ANALYST COVERAGE FIRM ANALYST PHONE EMAIL ATB Capital Markets Patrick J. ORourke, CFA 403-539-8615 porourkeatb.com Bank of America Merrill Lynch Asit Sen, CFA 646-855-2602 asit.senbaml.com BMO Nesbitt Burns Ray Kwan, P.Eng.…

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