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Corporate Presentation – Peyto Exploration & Development Corp

Peyto Exploration & Development Corp · Jan 1, 2025 · 40 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 – Peyto Exploration & Development Corp – slide 1
    www.peyto.com Corporate Presentation January 2025
  2. Corporate Presentation – Peyto Exploration & Development Corp – slide 2
    WHO IS PEYTO CORPORATE OVERVIEW 26-year publicly traded company focused Focused Assets exclusively on the Alberta Deep Basin ALBERTA 5th Largest 135,000 boe/d (12% liquids) December 2024 Canadian Gas Long reserve life assets (10yr…
  3. Corporate Presentation – Peyto Exploration & Development Corp – slide 3
    REPSOL ACQUISITION 1-YEAR LATER Successful Development of Acquisition Lands 14,000 12,000 Outperforming our recent Develop and Optimize New Lands programs by 40% 10,000 Started drilling immediately and have 2 rigs MCF/D…
  4. Corporate Presentation – Peyto Exploration & Development Corp – slide 4
    REPSOL ACQUISITION REALIZING SYNERGIES Pipeline header modification to Peyto has set a goal to reduce Reactivate pipeline to integrate Cecilia and Wild send Dunvegan gas to Wild River operating costs to 0.50/mcfe by for better liquid…
  5. Corporate Presentation – Peyto Exploration & Development Corp – slide 5
    WHO IS PEYTO FOCUSED CORE AREAS 1.1MM net acres of Alberta Deep Cutbank Basin Lands Own and operate 17 gas processing facilities with over 1.5 bcf/d of gross production capacity Kakwa Proximal to major pipeline egress (NGTL,…
  6. Corporate Presentation – Peyto Exploration & Development Corp – slide 6
    WHY WE DO IT NATURAL GAS Demand for Natural Gas Continues World Energy Consumption by Source (1965-2023) 700 Fossil fuels represent over 80% of 600 the worlds energy consumption. 500 Exajoules 400 300 200 100 0 1965…
  7. Corporate Presentation – Peyto Exploration & Development Corp – slide 7
    WHY WE DO IT GROWING LNG CAPACITY LNG growth in North America in 2024 - 2028 Mexico 0.6 bcf/d Plaquemines 3.2 bcf/d Corpus Christi 1.5 bcf/d 12 bcf/d of LNG Canada 1.8 bcf/d Golden Pass 2.4 bcf/d new capacity Rio Grande 2.3…
  8. Corporate Presentation – Peyto Exploration & Development Corp – slide 8
    WHY WE DO IT NATURAL GAS North American Demand for Natural Gas Continues to Grow USA Electricity Generation from Gas Further coal to gas switching could add 5 3500 Coal to gas switching in the bcf/d of gas demand by 2030 or as much 70…
  9. Corporate Presentation – Peyto Exploration & Development Corp – slide 9
    HOW WE DO IT PROFITABLE GROWTH 2023 PEY acquires Repsol 180,000 Assets 8,000 Peyto returns profits to shareholders through dividends. 2022 160,000 Over time, Peyto expects to match PEY acquires assets in 7,000 Cumulative…
  10. Corporate Presentation – Peyto Exploration & Development Corp – slide 10
    HOW WE DO IT DEEP BASIN ADVANTAGE (1) (3) 2023 YE PDP FD&A (/mcfe) Average Injected Water per Well by Formation, 2023 6.00 500,000 5.00 Better reservoir quality than Fit-for-purpose, nimble rigs (telescopic other plays such as…
  11. Corporate Presentation – Peyto Exploration & Development Corp – slide 11
    HOW WE DO IT LOW COSTS DRIVE MARGINS At Peyto we focus on costs since they are sticky, and they drive superior margins. Peytos margins were even stronger than liquids-weighted producers in 2023. 2023 Cash Costs (/mcfe) 2023 YE…
  12. Corporate Presentation – Peyto Exploration & Development Corp – slide 12
    HOW WE DO IT OWN AND CONTROL Gross Gross Raw Net Capacity Gas Plants Capacity Throughput (MMcf/d) (MMcf/d) (MMcf/d)* 1 Edson (WI: 83%) 275 228 128 2 Swanson 130 130 84 3 Nosehill 125 125 72 4 Oldman (Deep Cut) 125 125 104 5…
  13. Corporate Presentation – Peyto Exploration & Development Corp – slide 13
    HOW WE DO IT CONTINUOUS IMPROVEMENT Average Well Production by Spud Year Unit Drill and Complete Costs 10,000 1,000 By Year By Quarter 9,000 In 2024, Peyto realized a 25% uplift 900 8,000 in productivity relative to previous 800…
  14. Corporate Presentation – Peyto Exploration & Development Corp – slide 14
    HOW WE DO IT GROWING OPPORTUNITIES Kakwa Falher - Competitor Offsets 100,000 10,000 1,000 MCF/D Kakwa GP 100 10 1 New Falher Drills 0 20 40 60 80 100 120 PEY Spirit River Land Spirit River Horizontals Months…
  15. Corporate Presentation – Peyto Exploration & Development Corp – slide 15
    PEYTOS RETURNS ROBUST RESULTS Wells On Stream to end-Oct: 2024 Drilling Program Year to Date 63 gross / 61.3 net Price Deck: Flat, CA3.00/GJ, US70/bbl WTI Full Cycle Economics - 1,215,000/well Entire 2024 Program Forecasted BTAX…
  16. Corporate Presentation – Peyto Exploration & Development Corp – slide 16
    PEYTOS RETURNS RETURN ON EQUITY Investors rarely get to participate 60% in the wells themselves, making 12 type well economics somewhat meaningless. ROE and ROCE are 25% 50% the returns investors get, after 10 deducting…
  17. Corporate Presentation – Peyto Exploration & Development Corp – slide 17
    PEYTOS FUTURE 2025 FOCUS Drill 70 80 Net Hz Wells Focused on acquired lands and legacy Peyto properties Add 43,000 48,000 boe/d (10,500/boed) to offset 26-28% base production decline 450M- Optimize Infrastructure Gathering and…
  18. Corporate Presentation – Peyto Exploration & Development Corp – slide 18
    PEYTOS FUTURE UNDRILLED INVENTORY(1) Booked Inventory (Volume weighted) Average IRR by Species (3-year plan) 3.00/GJ and US70/bbl WTI 6% 25% 120% 109% 105% Cardium 100% 24% Dunvegan 83% 80% Notikewin 60% 60% 52% Falher 9%…
  19. Corporate Presentation – Peyto Exploration & Development Corp – slide 19
    PEYTOS FUTURE SUPPLY COST GOALS 2024 /mcfe 2020 2021 2022 2023 Goals Great results from acquisition drilling PDP FD&A (1) 1.06 0.97 1.41 1.21(3) Royalties 0.32 1.10 means FD&A should OPEX 0.49 come down for 2024 Cash Costs(1) 1.01…
  20. Corporate Presentation – Peyto Exploration & Development Corp – slide 20
    PEYTOS PAST PEYTOS FUTURE 180,000 Timing production growth to meet future 8.00 160,000 LNG capacity expansion, generates free 7.00 cash flow to fund the capital program, pay 140,000 dividends and reduce debt. 6.00 120,000…
  21. Corporate Presentation – Peyto Exploration & Development Corp – slide 21
    PEYTOS FUTURE CASH COSTS Still a Leader in the Industry Despite being the lowest cost Total Cash Costs (excluding(1) Royalties and Taxes) producer, Peyto strives to reduce 2.50 controllable unit costs. Peyto expects to achieve this…
  22. Corporate Presentation – Peyto Exploration & Development Corp – slide 22
    PEYTOS MARKETING Gas Hedging and Diversification Strategy Moderates Volatility Gas Price(1) (/mcf) AECO 10.00 5% 9.00 8.00 Kineticor Edmonton Empress 7.00 Power Calgary Emerson Parkway 6.00 13% 13% 17% 5.00 20% 4.00 3.00…
  23. Corporate Presentation – Peyto Exploration & Development Corp – slide 23
    GAS MARKETING Future Market Diversification and Gas Price Protection Peyto has used financial basis and physical transportation agreements between AECO and other 436 MMcf/d fixed at 4.14/Mcf in Q4 2024 hubs to gain market…
  24. Corporate Presentation – Peyto Exploration & Development Corp – slide 24
    GAS MARKETING Peyto uses a dollar cost averaging approach to Fixed Price Gas Contracts smooth out the volatility in future prices by forward selling smaller blocks of production. Fixed price swaps give price certainty. Prices do…
  25. Corporate Presentation – Peyto Exploration & Development Corp – slide 25
    GAS MARKETING Peyto has exposure to natural gas price upside with its diversification to premium markets in Floating Price Gas Contracts California, Ontario and the US mid-west and its Cascade Power contract. Henry Hub, Malin,…
  26. Corporate Presentation – Peyto Exploration & Development Corp – slide 26
    NGL MARKETING Peyto uses swaps and costless collars to secure Fixed Price Contracts liquids revenue as well. USD contracts converted at 1.42 CAD/USD 26
  27. Corporate Presentation – Peyto Exploration & Development Corp – slide 27
    DIVERSIFICATION POWER Cascade Gas Supply Agreement Peyto gas market diversification includes exposure to Alberta power pool prices Power Transmission Lines A 15-year Gas Supply Agreement, which came into effect on August…
  28. Corporate Presentation – Peyto Exploration & Development Corp – slide 28
    GAS DIVERSIFICATION LNG OPPORTUNITY Peyto is part of the Rockies LNG Consortium whose goal is to Our Partners support the construction of another LNG project off the Rockies LNG is a partnership of Canadian natural gas producers working…
  29. Corporate Presentation – Peyto Exploration & Development Corp – slide 29
    PEYTOS DEBT In June 2024, Peyto extended its Revolving Credit Facility and Amortizing Term Loan to October 13, 2027, and October 13, 2026, respectively. Peyto plans to reduce debt over the next 3 years targeting leverage under 1.0…
  30. Corporate Presentation – Peyto Exploration & Development Corp – slide 30
    PEYTOS TAX POOLS 1.1B 1,800 1,600 1,400 1,200 1,000 Federal Tax Pools 800 Q4/23 Millions 600 8.4B 400 200 - 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014…
  31. Corporate Presentation – Peyto Exploration & Development Corp – slide 31
    Development Plan The Company has presented herein a three-year illustrative development plan that provides for developing both the acquired assets and Peyto's current assets. The development plan is based on a number of assumptions…
  32. Corporate Presentation – Peyto Exploration & Development Corp – slide 32
    Oil and Gas Metrics Peyto has used a number of oil and gas metrics herein which do not have standardized meanings and therefore may be calculated differently from the metrics presented by other oil and gas companies. Such metrics include…
  33. Corporate Presentation – Peyto Exploration & Development Corp – slide 33
    Netback is a non-GAAP measure that represents the profit margin associated with the production and sale of petroleum and natural gas. Peyto computes field netback per Mcfe as commodity sales from production, plus third-party sales net of…
  34. Corporate Presentation – Peyto Exploration & Development Corp – slide 34
    PEYTOS HISTORY The Ensign 401 rig has been drilling for Peyto since November 2009. 35
  35. Corporate Presentation – Peyto Exploration & Development Corp – slide 35
    PEYTOS HISTORY PER SHARE GROWTH Over time, the Peyto model is designed to deliver a superior total return with per share growth in value, income and assets. Production/share Reserves/share 1 FFO/share 2 2P NPV5/debt adj. share 3…
  36. Corporate Presentation – Peyto Exploration & Development Corp – slide 36
    PEYTOS HISTORY SHAREHOLDER RETURNS 70.00 180,000 160,000 60.00 Peyto has a 26-year history of growing value, income and assets while delivering strong returns to 140,000 50.00 shareholders Sept-30-2024 15.40/sh 120,000…
  37. Corporate Presentation – Peyto Exploration & Development Corp – slide 37
    PEYTOS HISTORY COST CONTROL Peyto has been successfully controlling supply costs to preserve margin 30% on average during last 10 years. /mcfe 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 PDP FD&A(1) 2.25 1.64 1.44 1.36 1.18…
  38. Corporate Presentation – Peyto Exploration & Development Corp – slide 38
    PEYTOS HISTORY PROFITABLE RESERVES GROWTH Annual Reserves Per Share Reserve Life Index (1) (by Category) 8.00 (Reserves/ Q4 Annualized Production) Reserves per Share (boe/sh) 7.00 6.73 30 35 6.00 Reserve Life Index 30…
  39. Corporate Presentation – Peyto Exploration & Development Corp – slide 39
    PEYTOS HISTORY RESERVE GROWTH Over the past 25 years, Peyto has discovered 10.5 TCFe of natural gas reserves. 12,000 10,000 2,837 10.5 (BCFe) 8,000 6,000 4,000 26% CAGR 2,322 2,661 10,511 TCFe of…
  40. Corporate Presentation – Peyto Exploration & Development Corp – slide 40
    PEYTOS HISTORY LAND GROWTH Peyto continues to expand its Alberta Deep Basin footprint with additional drilling inventory. Peyto Lands 1.1 2,000 1,800 1,600 Million Net Acres 1,400 1,200 Net Sections 1,747 1,000…

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