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February 2014 Update – Cequence Energy Ltd.

Cequence Energy Ltd. · Feb 26, 2014 · 31 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. February 2014 Update – Cequence Energy Ltd. – slide 1
    February 2014 Update cequence energy ltd
  2. February 2014 Update – Cequence Energy Ltd. – slide 2
    Focus in the Deep Basin of Alberta Cequence is positioned to become a significant natural gas producer in Canada BRITISH ALBERTA COLUMBIA Simonette Project is ready for CANADA USA accelerated development Ansell Project has…
  3. February 2014 Update – Cequence Energy Ltd. – slide 3
    Corporate Profile Trading Symbol TSX: CQE Current Production (Boe/d) 12,000 52week trading range 1.32 2.15 Shares outstanding 211 million Insider ownership 13% FD Market capitalization (1) 420 million September 30, 2013…
  4. February 2014 Update – Cequence Energy Ltd. – slide 4
    Recent Highlights Yearend 2P reserves grew 24% to 113 Mmboe 2P FD&A was 11.17 per boe, F&D was 10.10 per boe NPV of 2P reserves increased 30% to 1 billion Ansell Wilrich Project has emerged as an exciting new opportunity for…
  5. February 2014 Update – Cequence Energy Ltd. – slide 5
    Guidance 40% growth planned for 2014 Preliminary 2014 2013 Guidance Guidance Production (Boe/d) 10,000 (1) 13,50014,000 Exit production guidance (Boe/d) 12,000 15,000 Capital expenditures 110 MM 120 MM Wells drilled 16 (13.8) 16…
  6. February 2014 Update – Cequence Energy Ltd. – slide 6
    Production and Cash Costs Production (Boe/d) Total Cash Costs (/Boe) (1) 16,000 20 14,000 Simonette and 18 Ansell Projects will 16 12,000 Merger with drive 40% growth Temple Energy in 2014 14 10,000 Boe/d 12 /Boe…
  7. February 2014 Update – Cequence Energy Ltd. – slide 7
    5 Year Development Plan 80% of drilling is assumed to be Montney at Simonette Major Assumptions: NO ADDITIONAL EQUITY 143 wells drilled in next five years (80% Montney, 20% other zones) Base Case Montney production model and…
  8. February 2014 Update – Cequence Energy Ltd. – slide 8
    Simonette Project Infrastructure Expansion completed (1311 capacity increased to 70 mmcfd) R2 R1W6 R27 R26 R25 R24 R23W5 Large land position Cequence Alliance 3D Seismic 87 net sections of Coverage T64 Meter Station Montney…
  9. February 2014 Update – Cequence Energy Ltd. – slide 9
    Alberta Deep Basin Montney Competitor Lands R9 R8 R7 R6 R5 R4 R3 R2 R1W6 R26 R25 R24 R23 R22 R21W5 T69 WAPITI Cequence owns 87 net sections of T68 Montney land at Simonette in the ANTE CREEK liquids rich, overpressured T67…
  10. February 2014 Update – Cequence Energy Ltd. – slide 10
    Alberta Deep Basin Montney HZ First 6 month cumulative gas production 1.8 1.6 1.4 1.2 Average of CQE Wells 540 MMcf Cum Gas (BCF) 1 Average All Wells 0.8 390 MMcf 0.6 0.4 0.2 0 Cequence Wells Industry…
  11. February 2014 Update – Cequence Energy Ltd. – slide 11
    Simonette Montney 2014 Winter Drilling Plan Proven Large Scale Economic Resource Play R2 R1W6 R27 R26 R25W5 Current Focus: 1) Transition to development style pad drilling Drilling 15356227W5 2) Continue to expand the T62…
  12. February 2014 Update – Cequence Energy Ltd. – slide 12
    Simonette Montney Development Plan R2 R1W6 R27 R26 R25W5 170250 locations depending on optimum well length 5 year plan will drill approximately 50% T62 of current inventory Current planned interwell spacing 400 m. OI 2.5…
  13. February 2014 Update – Cequence Energy Ltd. – slide 13
    Cequence Montney gas producers 14 wells to date BASE CASE HALF CYCLE ECONOMICS HIGH CASE Budget model 12 IP (MMcf/d) 5.5 7.5 2013 Montney Wells IP 30 (MMcf/d) 4.6 6.9 11 092106126W5 EUR (MBoe) 925 1,290 10 033106126W5 Raw Gas…
  14. February 2014 Update – Cequence Energy Ltd. – slide 14
    Montney Half Cycle Economics Sensitivity to Flat Gas Price and Recoverable Gas in Place per Well 20,000 Assumptions: Net NGL Yield: 30 Bbl/MMcf C3+ Capital: 7.5 MM Oil Price: 90/Bbl WTI 15,000 NPV 10% BT (M) 10,000…
  15. February 2014 Update – Cequence Energy Ltd. – slide 15
    Montney Drilling and Completion Costs steady improvement in cost over time Montney Drilling Costs Montney Completion Costs 7 4500 6 450 6 Target = 4000 4.2MM 5 375 Drill & Completion Costs M Target = 5 3500 2.75MM 4…
  16. February 2014 Update – Cequence Energy Ltd. – slide 16
    Simonette Dunvegan Oil, and Gas/Condensate Play R3 R2 R1W6 R27 R26 R25W5 Area average: IP rate 4.5 MMcf/d Competitor Location 102 well 90 day IP was T62 Reserves 4.0 BCF and 13 MMcf/d 50150 Bbl/MM NGL 52 well currently…
  17. February 2014 Update – Cequence Energy Ltd. – slide 17
    Simonette Falher Play R2 R1W6 R27 R26 R25W5 HALF CYCLE ECONOMICS Model First two CQE wells Model: IP (MMcf/d) 6.5 IP rate 6.5 MMcf/d IP 30 (MMcf/d) 5.5 average 90 day IP of Reserves 5 BCF and EUR (MBoe) Raw Gas (BCF) 840…
  18. February 2014 Update – Cequence Energy Ltd. – slide 18
    Simonette Wilrich Play R2 R1W6 R27 R26 R25 R24W5 T63 HALF CYCLE ECONOMICS Model 20 net sections currently IP (MMcf/d) 4.5 mapped with 40 potential IP 30 (MMcf/d) 3.9 EUR (MBoe) 690 locations Raw Gas (BCF) 4.0 Condy (MBbl)…
  19. February 2014 Update – Cequence Energy Ltd. – slide 19
    Ansell/Edson Wilrich Project Expanding land position R20 R19 R18 R17 R16W5 Two new wells tested, three additional T52 wells to be tested in Q1 PEYTO Pipeline To Talisman Cequence now owns 46 sections of land Edson Gas Plant and…
  20. February 2014 Update – Cequence Energy Ltd. – slide 20
    Conclusions Simonette Project proven large economic resource play in multiple zones Ansell project exciting drilling program and facilities construction in this new core area Financial strength CQE has a strong balance sheet…
  21. February 2014 Update – Cequence Energy Ltd. – slide 21
    Appendix Cequence Simonette 1311 Compressor Station 22
  22. February 2014 Update – Cequence Energy Ltd. – slide 22
    Canada Pension Plan Investment Board Private Debt Placement 60 million, 5 year unsecured notes issued at par Closed on October 3rd, 2013 Coupon rate 9%, plus 3.0 million warrants at 2.03 Initially used to pay down outstanding…
  23. February 2014 Update – Cequence Energy Ltd. – slide 23
    Management and Board Management Team Board of Directors Paul Wanklyn President and CEO Don Archibald Chairman Howard Crone Executive VP and COO Peter Bannister Dave Gillis VP Finance and CFO Rob Cook Steve Stretch VP…
  24. February 2014 Update – Cequence Energy Ltd. – slide 24
    Financial Highlights Q3 2013 Q2 2013 % Change Average Daily Production (Boe/d) 10,292 11,205 (8) Funds flow from operations (M) (1) 10,973 14,831 (26) Per share, basic and diluted 0.05 0.07 (29) Operating costs per Boe 8.29…
  25. February 2014 Update – Cequence Energy Ltd. – slide 25
    Netback Table YTD Sept 2013 Corporate Simonette Total Average daily production (Boe/d) 6,634 10,112 Natural gas (MMcf/d) 33.5 52.5 Oil and liquids (Bbls/d) 1,045 1,368 Sales price (/Boe) 28.72 27.94 Royalties (/Boe) (2.29)…
  26. February 2014 Update – Cequence Energy Ltd. – slide 26
    Hedging Volume Contract Type CAD Price GJ/d Average Gas 3.15/GJ AECO or 2013 July 1, 2013 to December 31, 2013 24,500 Swap 3.65/Mcf 50% remaining 2013 natural gas Average Gas 3.44/GJ AECO or 2014 January 1, 2014 to…
  27. February 2014 Update – Cequence Energy Ltd. – slide 27
    Reserves and Finding Costs solid growth per share in reserves and value FD&A (/Boe) Reserves 2P Reserve Value 16.00 140 0.7 1200 6 3 year average Reserve value has 1,036 Reserves increased 14.00 11.61per Boe doubled since…
  28. February 2014 Update – Cequence Energy Ltd. – slide 28
    Simonette Deep Basin Stack Dunvegan Wilrich Montney 2950 Simonette Upper 2975 CURRENT HORIZONAL TARGET ZONE Falher Bluesky / Gething 3000 Simonette Lower 3025 POTENTIAL 3050 HORIZONAL TARGET ZONE 3075…
  29. February 2014 Update – Cequence Energy Ltd. – slide 29
    Multiple Zones with Significant Resource Potential at Simonette 6 miles Zone Total Resource CEQUENCE LAND Potential/Sec (1) 2,400m Dunvegan 525 BCF 2,500m Falher 524 BCF 2,700m Wilrich 524 BCF 2,800m Gething 525 BCF…
  30. February 2014 Update – Cequence Energy Ltd. – slide 30
    Alberta Deep Basin Montney HZ Drilling Analysis CQE among most efficient drillers 300 12000 300 12000 2012 and older 245 wells 2013 63 wells Measured Depth (m) Measured Depth (m) 250 10000 250 10000 CQE P50 All Wells P50 CQE…
  31. February 2014 Update – Cequence Energy Ltd. – slide 31
    www.cequence-energy.com Contacts: 3100, 525 - 8th Avenue SW Calgary AB T2P 1G1 Paul Wanklyn David Gillis President & CEO Vice President, Finance & CFO Phone: 403-229-3050 Fax: 403-229-0603 pwanklyncequenceenergy.com…

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