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Corrib Acquisition and 2022 Budget – Vermilion Energy Inc.

Vermilion Energy Inc. · Nov 29, 2021 · 20 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. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 1
    NOVEMBER 29, 2021 VERMILION ENERGY CORRIB ACQUISITION & 2022 BUDGET CONFERENCE CALL INTERNATIONALLY DIVERSIFIED FREE CASH FLOW FOCUSED ESG LEADERSHIP
  2. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 2
    CORRIB ACQUISITION OVERVIEW Vermilion to acquire Equinor Energy Ireland Limited which owns a 36.5% interest in Corrib o 23 mmboe of 2P reserves and 7,700 boe/d of 2022 forecast production o 2022E FFO of 365 million* and FCF** of 361…
  3. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 3
    CORRIB ACQUISITION KEY ATTRIBUTES Consolidates ownership in an operated asset with high margin, low decline and low emissions at an attractive price o Increases Vermilions operated ownership in Corrib to 56.5% o Corrib has an…
  4. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 4
    CORRIB ACQUISITION KEY ATTRIBUTES Increases exposure to premium priced European natural gas o 22% of production and 42% of FFO, based on 2022 full-year pro forma estimate* Enhances and rebalances international weighting of…
  5. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 5
    EXPOSURE TO EUROPEAN GAS ENHANCES NETBACKS PRODUCTION FFO OIL (BRENT) OIL (BRENT) 18% EUROPEAN 23% GAS 15% EUROPEAN 2022E VET BASE* OIL / CONDENSATE / OIL / GAS 24% NORTH CONDENSATE / NGL NGL (WTI) AMERICAN GAS (WTI)…
  6. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 6
    ENHANCED OPERATING NETBACK 2022E OPERATING NETBACKS 60.00 100% 90% 2022E OPERATING NETBACK (/BOE)* 50.00 2022E LIQUIDS WEIGHTING (%)* 80% 70% 40.00 AVERAGE = 32.24 60% 30.00 50% 40% 20.00 30% 20% 10.00 10% 0.00…
  7. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 7
    PREMIUM EUROPEAN NATURAL GAS PRICING European natural gas forward prices currently trading GLOBAL NATURAL GAS PRICES C38/ at C23.00/mmbtu for 2022 and C15.00/mmbtu mmbtu for 2023, supported by: 25 o Declining European domestic…
  8. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 8
    STRONG MARKET FUNDAMENTALS FOR EUROPEAN GAS Declining European domestic production results in higher /ton EMISSION ALLOWANCES (EUA CARBON CREDITS) dependence on imports 80.00 PRICE HISTORY o Groningen field will cease production in…
  9. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 9
    REBALANCING INTERNATIONAL PORTFOLIO PRODUCTION FFO FCF INT 2022E VET 33% N.A. INT N.A. INT BASE* 47% 45% N.A. 53% 55% 67% INT N.A. N.A. 2022 FULL YEAR 39% 37% 40% INT PRO FORMA** N.A. INT 61% 60% 63% * Based on…
  10. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 10
    PRO FORMA FFO ACCRETION OF 33% FFO FORECAST* FFO PER SHARE FORECAST* 1,600 10.00 9.00 1,400 8.00 33% 1,200 7.00 1,000 6.00 /SHARE MM 800 5.00 4.00 600 3.00 400 2.00 200 1.00 0 - 2021E 2022E 2021E 2022E VET…
  11. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 11
    PRO FORMA FCF ACCRETION OF 53% FCF FORECAST* FCF PER SHARE FORECAST* 1,200 7.00 6.00 1,000 5.00 53% 800 4.00 /SHARE MM 600 3.00 400 2.00 200 1.00 0 - 2021E 2022E 2021E 2022E VET Base FY Pro Forma VET Base…
  12. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 12
    ENHANCED FREE CASH FLOW YIELD 2022E FCF YIELD* 60% 50% 40% 30% AVERAGE = 23% 20% 10% 0% VET** CPG ARX ERF NVA MEG PEY BTE WCP BIR CVE TOU AAV POU CNQ SU IMO 2022E FY Pro Forma Average *Source: Peters & Co.…
  13. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 13
    ENHANCED DEBT ADJUSTED FREE CASH FLOW YIELD 2022E DAFCF YIELD* 30% AVERAGE = 20% 20% 10% 0% VET** ERF NVA ARX CPG MEG WCP BTE PEY BIR TOU POU AAV CVE CNQ SU IMO 2022E Full-Year Pro Forma Average *Source: Peters &…
  14. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 14
    CORRIB HAS LOW EMISSION INTENSITY SCOPE 1 AND 2 EMISSIONS 70.0 60.0 50.0 kg CO2e/boe 40.0 28.6 30.0 25.0 20.0 10.0 4.2 0.0 Oil Weighted Peers Gas Weighted Peers Average * Scope 1 and 2 emissions before…
  15. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 15
    2022 BUDGET AND GUIDANCE E&D CAPITAL BUDGET GUIDANCE 2022 E&D capital budget of 425 million 500 o North America - 215 million (3% decrease vs 2021) 400 300 International - 210 million (36% increase vs 2021) MM o 200…
  16. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 16
    RETURN OF CAPITAL STRATEGY Plan to reinstate a 0.06 per share quarterly dividend commencing in Q1 2022 o Equates to an annual cash outlay of approximately 40 million o Less than 3% of 2022 full-year pro forma FFO* and approximately…
  17. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 17
    ACQUISITION ACCELERATES DELEVERAGING NET DEBT AND NET DEBT TO TRAILING FFO RATIO 1,800 2.0x 1,600 1.8x 1.6x 1,400 1.4x MM 1,200 1.2x 1,000 1.0x -11% 800 0.8x 600 0.6x 2021E 2022E NET DEBT NET DEBT / FFO NET DEBT…
  18. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 18
    COMMODITY HEDGE POSITION 2022 2023 60% 60% PERCENTAGE OF PRODUCTION HEDGED (%)** PERCENTAGE OF PRODUCTION HEDGED (%)** 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% Crude Oil European N.A. Corporate Crude Oil…
  19. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 19
    SUMMARY Corrib Acquisition is deleveraging and highly accretive on an FFO and FCF per share basis and enhances our ability to return additional capital to shareholders o Acquisition is self-funded with a quick 2-year payout and high…
  20. Corrib Acquisition and 2022 Budget – Vermilion Energy Inc. – slide 20
    SUMMARY Our plan to reinstate a 0.06 per share quarterly dividend provides a sustainable base dividend for shareholders while allowing for further debt reduction and capacity for future dividend increases o Return of capital…

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