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May 2021 Presentation – Peyto Exploration & Development Corp

Peyto Exploration & Development Corp · May 1, 2021 · 56 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. May 2021 Presentation – Peyto Exploration & Development Corp – slide 1
  2. May 2021 Presentation – Peyto Exploration & Development Corp – slide 2
    PEY.TO Who We Are PEYTO Exploration & Development Corp. N Pure Play Alberta Deep Basin - 465 mmcf/d Gas, 12,500 bbl/d NGLs N Returns Focused Strategy - Avg ROCE 15%, ROE 26% over last 22 yrs, among highest in the industry N…
  3. May 2021 Presentation – Peyto Exploration & Development Corp – slide 3
    PEY.TO 20 Year Growth Per Share PEYTO Exploration & Development Corp. Historical Per Share (or unit) and Shares (units) Outstanding numbers have been adjusted to reflect the May 27, 2005 2:1 stock split 4 BOE factor - 6 mcf = 1…
  4. May 2021 Presentation – Peyto Exploration & Development Corp – slide 4
    PEY.TO Total Shareholder Return Model PEYTO Exploration & Development Corp. Future Prospects Past Profits 5 BOE factor - 6 mcf = 1 bbl of oil equivalent 5/11/2021
  5. May 2021 Presentation – Peyto Exploration & Development Corp – slide 5
    Environmental Leadership Canada Leads in Reducing Natural Gas Flaring PEYTO Exploration & Development Corp. Over the last 5 years, Canada has been one of the leaders in the reduction of gas flaring. Thats the Canadian energy…
  6. May 2021 Presentation – Peyto Exploration & Development Corp – slide 6
    Environmental Leadership Industry Improving Peyto Leading the Way PEYTO Exploration & Development Corp. Emission Intensity by Source Type for Canadian Oil and Gas (1990, 2005, 2016) 140 140 121.4 Emmission Intensity per Barrel…
  7. May 2021 Presentation – Peyto Exploration & Development Corp – slide 7
    Environmental Leadership Continuously Improving Environmental Performance PEYTO Exploration & Development Corp. Peyto GHG Emissions Intensity 29.0 26.0 24.7 23.9 22.3 21.1 19.8 19.6 2013 2014 2015 2016 2017 2018 2019 2020…
  8. May 2021 Presentation – Peyto Exploration & Development Corp – slide 8
    The Peyto Strategy PEYTO Exploration & Development Corp. 9 5/11/2021
  9. May 2021 Presentation – Peyto Exploration & Development Corp – slide 9
    Peytos Strategy What We Continue To Believe PEYTO Exploration & Development Corp. N Natures gas is the fuel for the future. N Our gas and NGLs have some of the lowest emissions of any hydrocarbons produced in Canada. N Our business…
  10. May 2021 Presentation – Peyto Exploration & Development Corp – slide 10
    Peytos Strategy Growing North American Gas Market PEYTO Exploration & Development Corp. North America Gas Consumption (BCF/d) (BP Statistical Review of World Energy 2019) 140 140 120 120 100 100 32% growth 80 2008-2018 80…
  11. May 2021 Presentation – Peyto Exploration & Development Corp – slide 11
    Peytos Strategy Canadian Gas Egress Is Expanding PEYTO Exploration & Development Corp. Dry Natural Gas Production - Canada 25 (EIA) 9 LNG Export 8 2.0 Bcf/d 7 LNG Canada 20 6 NGTL Expansion 5+40% BCF/D 4 15 15.35…
  12. May 2021 Presentation – Peyto Exploration & Development Corp – slide 12
    Peyto FFO CTD Q4/20 CTD Q4/20 Peyto Capital Fund Growth From Cashflow The Peyto Strategy 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 Q4 1999 Q2 2000 Q4 2000 Q2 2001 Q4 2001 Q2 2002 Q4 2002 Q2 2003 Q4…
  13. May 2021 Presentation – Peyto Exploration & Development Corp – slide 13
    The Peyto Strategy Invest For Profit Not Growth PEYTO Exploration & Development Corp. 800 700 600 500 400 Peyto Capital 300 CTD Q4/20 200 100 - 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 (100) CAPEX (MM)…
  14. May 2021 Presentation – Peyto Exploration & Development Corp – slide 14
    The Peyto Strategy Dividend Sustainability PEYTO Exploration & Development Corp. 3,000 2,500 2,000 Peyto Ctd. Earnings (MM) 1,500 Q4/20 1,000 500 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009…
  15. May 2021 Presentation – Peyto Exploration & Development Corp – slide 15
    The Peyto Strategy 22 Year Cycle of Value Creation PEYTO Exploration & Development Corp. 6.40B Capital Investment 55% retained FFO YE 2020 26% equity 18% debt 2P NPV5 2.55B 8.65B Value Earnings 6.992B 2.46B in div/dist 0.38B to…
  16. May 2021 Presentation – Peyto Exploration & Development Corp – slide 16
    Peytos Profitable Business PEYTO Exploration & Development Corp. 17 5/11/2021
  17. May 2021 Presentation – Peyto Exploration & Development Corp – slide 17
    Peytos Profitable Business Build it for less than we sell it PEYTO Exploration & Development Corp. 2014 2015 2016 2017 2018 2019 2020F 2020 Land/Acq/Disp Seismic Drilling PDP FD&A /mcfe (2.25) (1.64) (1.44) (1.36) (1.18) (1.55)…
  18. May 2021 Presentation – Peyto Exploration & Development Corp – slide 18
    Peytos Profitable Business The Price Bar Is Now Very Low, We Must Go Lower PEYTO Exploration & Development Corp. AECO 10 Monthly /GJ Peyto Realized Gas Price (/mcfe) 8 35% Avg. 6 Profit CTD Bonus 4 PDP FD&A 7% 2…
  19. May 2021 Presentation – Peyto Exploration & Development Corp – slide 19
    Peytos Profitable Business Peytos Moat is a Low-Cost Advantage PEYTO Exploration & Development Corp. 2.98 4.54 (0.14) 1.02 20 BOE factor - 6 mcf = 1 bbl of oil equivalent Data from Peters & Co. 5/11/2021 Gas…
  20. May 2021 Presentation – Peyto Exploration & Development Corp – slide 20
    Peytos Profitable Business High Operating Margins PEYTO Exploration & Development Corp. 90% 9.00 80% 8.00 70% 7.00 60% 6.00 50% 5.00 40% 4.00 30% 3.00 20% 2.00 10% 1.00 Peyto Operating Margin 0% 0.00 20 Year Avg.…
  21. May 2021 Presentation – Peyto Exploration & Development Corp – slide 21
    Peytos Unique Assets PEYTO Exploration & Development Corp.
  22. May 2021 Presentation – Peyto Exploration & Development Corp – slide 22
    Peytos Assets Geographically Focused Core Areas PEYTO Exploration & Development Corp. 566,400 net acres 10 operated gas plants Cutbank ---(875 mmcf/d net capacity) 2,000+ km pipelines 1,442+ producing zones Kakwa 90,000 boe/d…
  23. May 2021 Presentation – Peyto Exploration & Development Corp – slide 23
    Peytos Assets PEYTO Deep Basin Permeability Segregation Exploration & Development Corp. FOOTHILLS STRUCTURES GAS AS ING INCRE BILITY EA PERM WATER TRANSITION ZONE WATER GAS ASE INCRE AREA OF GAS DEPTH…
  24. May 2021 Presentation – Peyto Exploration & Development Corp – slide 24
    Peytos Assets Multi Zone Stacked Sandstone Reservoirs PEYTO Exploration & Development Corp. Detailed Petrophysical work on the Spirit River sands revealed 30% more reserves per section Up to per section* 25 *NGL…
  25. May 2021 Presentation – Peyto Exploration & Development Corp – slide 25
    Peytos Assets Cecilia Acquisitions 35MM Effective Jan 1/21 PEYTO Exploration & Development Corp. Cecilia Gas Plant 12-34-56-22W5 Ownership: 100% WI NGTL Nosehill Ck North Meter Current Throughput: 15mmcf/d sales 5.6bbl/mmcf…
  26. May 2021 Presentation – Peyto Exploration & Development Corp – slide 26
    Peytos Assets Cecilia Acquisitions Ultra-low Decline PEYTO Exploration & Development Corp. 114 gross producers CTD 165 BCF 27 5/11/2021
  27. May 2021 Presentation – Peyto Exploration & Development Corp – slide 27
    Peytos Assets 1 Horizontal Deep Basin Driller PEYTO Exploration & Development Corp. Alberta Deep Basin Hz Spuds 1,200 Peyto spud its 1,000 th Hz w ell on Sept. 25, 2020 1,000 800 600 400 200 Peyto Deep Basin 0 Horizontal…
  28. May 2021 Presentation – Peyto Exploration & Development Corp – slide 28
    Peytos Assets PEYTO Large Hz MSF Inventory Exploration & Development Corp. Done1 To Do Total Total Total Total Hz(Vt) Hz Locations Vertical Hz Locations Unbooked3 Wells Wells Booked2 2 (2) 440 200 459(9) 424 5 1 1 4 1 2…
  29. May 2021 Presentation – Peyto Exploration & Development Corp – slide 29
    Peytos Assets Deep Basin Lands Go A Long Way PEYTO Exploration & Development Corp. 1,000 Peyto Lands 900 800 700 Net Sections 600 Net Peyto Sections 500 400 300 200 100 - Net Sections of Cardium, Dunvegan,…
  30. May 2021 Presentation – Peyto Exploration & Development Corp – slide 30
    Peytos Assets Facility Ownership And Control PEYTO Exploration & Development Corp. Cutbank Kakwa Oldman (with Deep Cut) & Oldman North Cecilia W Peyto Gas Plants Wildhay Nosehill Swanson YE 2020 WI 1 Oldman 125 mmcf/d…
  31. May 2021 Presentation – Peyto Exploration & Development Corp – slide 31
    Peytos Assets Valuable Midstream Processing Capacity PEYTO Exploration & Development Corp. Peyto Processing Capacity is currently limited to 715 MMCF/d* 700,000 2P Reserves 815 MMBoes Go Forward Processing Capacity Forecast…
  32. May 2021 Presentation – Peyto Exploration & Development Corp – slide 32
    Peytos Assets Big Sunny Natural Gas Storage Scheme PEYTO Exploration & Development Corp. R.25 R.24 R.23 R.22 R.21 R.20 R.19 R.18 Nosehill Creek North Cecilia Meter Station 139 mmcfd Capacity T.56 T.56 Obed North Oldman…
  33. May 2021 Presentation – Peyto Exploration & Development Corp – slide 33
    Peytos Assets Unique Infrastructure Location PEYTO Exploration & Development Corp. Alliance Cecilia Oldman & Oldman North Nosehill Wildhay Big Sunny Galloway Swanson 240 kV Power Lines Highway 16 Cascade Power…
  34. May 2021 Presentation – Peyto Exploration & Development Corp – slide 34
    Peytos Assets First Cardium Hzs Have Reached Terminal Decline PEYTO Exploration & Development Corp. 6 Years There is nothing sexy about a 200 mcf/d gas well, except when it doesnt decline. Then it becomes an incredible…
  35. May 2021 Presentation – Peyto Exploration & Development Corp – slide 35
    Peytos Assets Long Reserve Life Asset PEYTO Exploration & Development Corp. RESERVE LIFE INDEX 30 25 YEARS AT Q4 PRODUCTION 27.4 20 15 17.6 10 Years PDP 5 9.0 0 2001 2002 2003 2004 2005 2006 2007 2008…
  36. May 2021 Presentation – Peyto Exploration & Development Corp – slide 36
    Peytos Assets Organic Reserves Growth PEYTO Exploration & Development Corp. 8,000 7,000 6,000 1,787 5,000 27% 15% CAGR 1,572 4,000 CAGR 3,000 1,647 2,000 1,000 2,034 TCFe of Discovered Reserves 0 Cum Production…
  37. May 2021 Presentation – Peyto Exploration & Development Corp – slide 37
    Peytos Assets What Shareholders Currently Own PEYTO Exploration & Development Corp. Tangible Infrastructure (Replacement Value as at Dec 31, 2020) 80 Compressors (3.25MM each) 259 MM 17 Inlets (1.8MM each) 31 MM 20 Refrigeration…
  38. May 2021 Presentation – Peyto Exploration & Development Corp – slide 38
    Peytos Incredible Returns PEYTO Exploration & Development Corp. 39 5/11/2021
  39. May 2021 Presentation – Peyto Exploration & Development Corp – slide 39
    Peytos Returns Updated Template Economics At Strip PEYTO Exploration & Development Corp. Gross IP3 Gross EUR Gross DCET Half Cycle Type Entity (boe/d) (mboe) % Liquids (M) IRR (%) 2020 Brazeau Cardium 965 610 25% 3,060 262% 2020…
  40. May 2021 Presentation – Peyto Exploration & Development Corp – slide 40
    Peytos Returns 2020 Post-Mortem Returns Analysis Insight Deck PEYTO Exploration & Development Corp. 41 Full cycle IRR is determined using actual capital spent on each well, including a 825k provision for land, seismic, and…
  41. May 2021 Presentation – Peyto Exploration & Development Corp – slide 41
    Peytos Returns High Returns On Your Capital And Equity PEYTO Exploration & Development Corp. 60% 12 50% 10 40% 8 22 yr Avg ROE to 2020 30% 6 20% 4 10% 2 0% 0 Return On Capital Employed (%) Return On Equity…
  42. May 2021 Presentation – Peyto Exploration & Development Corp – slide 42
    Peytos Future PEYTO Exploration & Development Corp.
  43. May 2021 Presentation – Peyto Exploration & Development Corp – slide 43
    Peytos Future 2021 Outlook PEYTO Exploration & Development Corp. Drill 80Hz Wells (Liquids Rich Natural Gas) vs 65 in 2020 Market 3rd Party Capacity Offer Excess Capacity to Other Operators Increase Opportunities Undeveloped…
  44. May 2021 Presentation – Peyto Exploration & Development Corp – slide 44
    Peytos Future Gas Price Stability Before Returning to Growth PEYTO Exploration & Development Corp. 14 bbl/mmcf 14 bbl/mmcf 17 bbl/mmcf 20 bbl/mmcf 26 bbl/mmcf 28 bbl/mmcf 26 bbl/mmcf 25 bbl/mmcf 24 bbl/mmcf 5 4.19 Uses 90% of…
  45. May 2021 Presentation – Peyto Exploration & Development Corp – slide 45
    Peytos Future Lower Costs to Preserve Profit PEYTO Exploration & Development Corp. PEY 2018 PEY 2019 PEY 2020 2021 PEY Goals 86% Gas 2.11/GJ*1.15 86% Gas 2.50/GJ*1.15 14% NGLs31/bbl=(60%of 52oil) 3.27 2.78 2.23 3.32 14%…
  46. May 2021 Presentation – Peyto Exploration & Development Corp – slide 46
    Peytos Future Blue Hydrogen We Have All the Right Ingredients PEYTO Exploration & Development Corp. Cecilia Cascade Power Station H2 4 TCF of 2P Interconnected gas Big Sunny Rail, Hwy, and natural gas pipeline and…
  47. May 2021 Presentation – Peyto Exploration & Development Corp – slide 47
    Gas Marketing Future Market Diversification and Gas Price Protection PEYTO Exploration & Development Corp. We have virtually no exposure to AECO until 2023 Approx. 70% of 2021 is fixed price 48 *Average Heating Value…
  48. May 2021 Presentation – Peyto Exploration & Development Corp – slide 48
    Gas Marketing Fixed Price Swaps For Gas and Liquids PEYTO Exploration & Development Corp. Peyto Marketing Summary 1.15 Heating Value GJ/mcf AECO 7A Fixed Price Swaps (CAD/GJ) 1.255 cad/usd TOTAL TOTAL TOTAL TOTAL TOTAL Q4 2019 2019…
  49. May 2021 Presentation – Peyto Exploration & Development Corp – slide 49
    Gas Marketing Successful Hedging Strategy Smoothes Volatility PEYTO Exploration & Development Corp. Gas Price (/mcf) 10.00 10.00 9.00 Peyto has beat the AECO 9.00 8.00 monthly price in 12 of the 8.00 last 15 years using a 7.00…
  50. May 2021 Presentation – Peyto Exploration & Development Corp – slide 50
    Gas Marketing Balanced Revenue Stream PEYTO Exploration & Development Corp. 2020 ACTUALS Condy & C5+ - Fixed Gas - AECO 9% (5a/7a) 11% Condy & C5+ 19% Gas - AECO Fixed 23% LPG Gas - 5% Malin Gas- Henry Gas - 2.0% Hub…
  51. May 2021 Presentation – Peyto Exploration & Development Corp – slide 51
    Gas Marketing LNG Consortium and Export Potential PEYTO Exploration & Development Corp. 52 5/11/2021
  52. May 2021 Presentation – Peyto Exploration & Development Corp – slide 52
    Appendix PEYTO Exploration & Development Corp. N Quarterly Track Record N Tax Pools N Leverage N Reserves Growth 53 5/11/2021
  53. May 2021 Presentation – Peyto Exploration & Development Corp – slide 53
    Quarterly Track Record PEYTO Exploration & Development Corp. 2021 2020 2019 2018 Q1 Total Q4 Q3 Q2 Q1 Total Q4 Q3 Q2 Q1 Total Q4 Q3 Operations Production Oil & NGLs (bbl/d) 12,138 11,308 11,256 11,263 11,126 11,585 10,922 11,221…
  54. May 2021 Presentation – Peyto Exploration & Development Corp – slide 54
    Organic Business Model Peytos Tax Pools PEYTO Exploration & Development Corp. 1,800 1,600 1,400 1,200 1,000 800 Federal Tax Pools Millions 600 400 Q4/20 200 - 1999 2000 2001 2002 2003 2004 2005 2006 2007…
  55. May 2021 Presentation – Peyto Exploration & Development Corp – slide 55
    Peytos Debt Blend of fixed term and revolving debt PEYTO Exploration & Development Corp. 50 4.88% End of 0.95B Revolver Oct 22 65 4.26% 100 3.70% 100 3.95% 100 4.39% 56 Interest rates are in CND 5/11/2021
  56. May 2021 Presentation – Peyto Exploration & Development Corp – slide 56
    PEY.TO COVID19 Preparedness PEYTO Exploration & Development Corp. 1. Office Preparations All staff set up with remote desktop working capabilities (multiple communication tools: email, text, phone, conference, Webex, etc) Small,…

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