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January 2015 Investor Update – Long Run Exploration Ltd.

Long Run Exploration Ltd. · Jan 14, 2015 · 28 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. January 2015 Investor Update – Long Run Exploration Ltd. – slide 1
    INVESTOR UPDATE JANUARY 2015 1
  2. January 2015 Investor Update – Long Run Exploration Ltd. – slide 2
    LONG RUN PROFILE Long Run Exploration is a Northern Gas Calgarybased intermediate oil 2,900 Boe/d and natural gas company focused on light oil ALBERTA development and exploration Peace River Area in western Canada.…
  3. January 2015 Investor Update – Long Run Exploration Ltd. – slide 3
    CORPORATE STRATEGY Provide longterm value to shareholders through a sustainable dividend model Focus on operational efficiency and capital discipline Balance production between natural gas and oil Maintain balanced portfolio…
  4. January 2015 Investor Update – Long Run Exploration Ltd. – slide 4
    BUSINESS PLAN Key inputs to a sustainable business model Longterm focus Extensive drilling inventory 1,000 booked locations Target total payout ratio Enhanced oil recovery of 100% or less Initiated in both Peace River and…
  5. January 2015 Investor Update – Long Run Exploration Ltd. – slide 5
    PRODUCTION PROFILE Completed Deep Completed Crocotta Basin property 40,000 acquisition Energy Inc. acquisition (August 2014) (May 2014) 35,000 30,000 Production (Boe/d) 25,000 20,000 15,000 10,000 5,000 0…
  6. January 2015 Investor Update – Long Run Exploration Ltd. – slide 6
    2015 CORPORATE GUIDANCE 2015 Guidance(1) Based on WTI US70/Bbl average for 2015, with an average of 60/Bbl in Q1 Production average (Boe/d) 35,000 36,000 % oil and NGLs 44 Funds flow includes average operating costs of 13.00/Boe…
  7. January 2015 Investor Update – Long Run Exploration Ltd. – slide 7
    DEVELOPMENT PLAN FOR 2015 Capital Expenditures (by area) Capital Expenditures Millions 15 Well Capital 115 wells Plant & Facilities 20 25 wells G&G, Land, HS&E 30 TOTAL 165 Deep Basin Cardium Property Peace River…
  8. January 2015 Investor Update – Long Run Exploration Ltd. – slide 8
    DEVELOPMENT PLAN FOR 2015 Property Overview Peace River Deep Basin Deep Basin Redwater Montney Pine Creek Cardium Kakwa Cardium Viking Onstream cost 2.1 3.0 3.4 1.2 (MM)(1) 12month capital 20,000 17,200 12,800 34,300…
  9. January 2015 Investor Update – Long Run Exploration Ltd. – slide 9
    DEVELOPMENT PLAN FOR 2015 By Property 100 Capital Expenditures Net operating income(1) 75 Million 50 25 wells 25 15 wells 0 Peace River Montney Deep Basin Cardium Redwater Viking Northern Gas Minor Properties…
  10. January 2015 Investor Update – Long Run Exploration Ltd. – slide 10
    RISK MANAGEMENT 2015 Oil Hedges 2015 Natural Gas Hedges 60% 100 60% 4.00 50% 50% 3.80 90 40% 40% 3.60 /Bbl /GJ 30% 80 30% 3.40 20% 20% 70 10% 10% 3.20 0% 60 0% 3.00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 % of Production Hedged…
  11. January 2015 Investor Update – Long Run Exploration Ltd. – slide 11
    2015 FORECAST SENSITIVITIES Annual Base +/ Impact ( Million) Assumption Sensitivity on 2015 Forecast WTI (USD/Bbl) 70.00 +/ 1.00 = 3.6 AECO (CAD/GJ) 3.50 +/ 0.10 = 3.0 Edmonton par (CAD) 71.25 +/ 1.00 = 3.6 USD/CDN FX 1.145…
  12. January 2015 Investor Update – Long Run Exploration Ltd. – slide 12
    CAPITAL STRUCTURE Share Capital: Debt Structure 193.5 million common shares outstanding (at September 30, 2014) Credit Facilities: Long Runs lending facilities total 695 million Credit Financial requirements under the credit…
  13. January 2015 Investor Update – Long Run Exploration Ltd. – slide 13
    DIVIDEND REINVESTMENT PLAN Long Run is implementing a Dividend Reinvestment Plan (DRIP) Proceeds from the DRIP will be used to support the capital program No DRIP participation is currently included in our 2015 guidance…
  14. January 2015 Investor Update – Long Run Exploration Ltd. – slide 14
    PEACE RIVER MONTNEY Normandville/Girouxville Montney horizontal oil development 950m vertical depth October 2014 estimated production of 11,100 Boe/d (60% oil and NGLs) Normandville Medium gravity oil (28o API) Normandville Oil…
  15. January 2015 Investor Update – Long Run Exploration Ltd. – slide 15
    ENHANCED OIL RECOVERY (EOR) Peace River Montney Property Good waterflood candidate for pressure support: Normandville Large oil in place reservoir Good rock permeability of 10 20 md EOR project at Normandville currently…
  16. January 2015 Investor Update – Long Run Exploration Ltd. – slide 16
    DEEP BASIN CARDIUM Pine Creek/Edson Cardium horizontal light oil development 1,800m 1,900m vertical depth 1309 LRE Bluesky horizontal liquidsrich natural gas Battery/Compressor development Station 6,500 boe/d (100%) Pine Creek…
  17. January 2015 Investor Update – Long Run Exploration Ltd. – slide 17
    DEEP BASIN CARDIUM Kakwa/Wapiti Cardium horizontal liquidsrich natural gas 1,000m 1,600m vertical depth October 2014 estimated production of 3,950 Boe/d (30% liquids) NGL content of 4050 Bbl/Mmcf First four wells have been…
  18. January 2015 Investor Update – Long Run Exploration Ltd. – slide 18
    REDWATER VIKING 0721 Redwater North Viking horizontal oil development Oil Battery 5,000 bbls/d 700m vertical depth 4.0 mmcf/d T58 October 2014 estimated production of Redwater 0517 Redwater North 4,700 Boe/d (85% liquids)…
  19. January 2015 Investor Update – Long Run Exploration Ltd. – slide 19
    ENHANCED OIL RECOVERY Redwater Viking Property Good waterflood candidate for pressure support: Large oil in place reservoir Good rock permeability of 10 20 md Relatively uniform vertical and lateral rock properties Redwater…
  20. January 2015 Investor Update – Long Run Exploration Ltd. – slide 20
    NORTHERN GAS Boyer Bluesky natural gas 200m 500m vertical depth October 2014 estimated production of 2,900 Boe/d (100% natural gas) Shallow decline (8%/year) 690,000 net acres Current drilling density less than 1.5 wells per…
  21. January 2015 Investor Update – Long Run Exploration Ltd. – slide 21
    LONG RUN KEY VALUE DRIVERS Deliver a focused capital program targeting total corporate sustainability ratio of 100% or less Continue to exploit our balanced portfolio of properties through development, enhanced recovery and…
  22. January 2015 Investor Update – Long Run Exploration Ltd. – slide 22
    SUPPLEMENTAL INFORMATION 22
  23. January 2015 Investor Update – Long Run Exploration Ltd. – slide 23
    ENHANCED OIL RECOVERY (EOR) Waterflood Current Waterflood Pilots Major oil projects under early stage waterflood Pilot Expansion of Area Formation Comments Start Date Start Date Injectors Cost effective reserve additions This…
  24. January 2015 Investor Update – Long Run Exploration Ltd. – slide 24
    RISK MANAGEMENT Costless Collars Volume Pricing Financial hedges mitigate risk January 1, 2015 December 31, 2015 2,500 Bbl/day WTI US 95.00 97.50/ Bbl associated with commodity price volatility Crude Oil Fixed Price Volume…
  25. January 2015 Investor Update – Long Run Exploration Ltd. – slide 25
    NETBACKS BY AREA Peace River Deep Basin Redwater Northern Area Area Area Gas Total October 2014 13,850 11,150 8,200 2,900 38,250 Estimated Production (Boe/d) % Liquids 55% 30% 60% 45% Oil Quality 28 API 42 API 38 API 32…
  26. January 2015 Investor Update – Long Run Exploration Ltd. – slide 26
    TAX POOLS Tax Pools Annual Deduction Millions Undepreciated Capital Cost (UCC) Up to approximately 25% 370 Canadian Oil & Gas Property Expense (COGPE) Up to 10% 440 Canadian Development Expense (CDE) Up to 30% 630 Canadian…
  27. January 2015 Investor Update – Long Run Exploration Ltd. – slide 27
    BANK SYNDICATE Bank of Nova Scotia National Bank of Canada The TorontoDominion Bank HSBC Bank Canada Wells Fargo Bank, N.A., Canadian Branch Canadian Imperial Bank of Commerce Alberta Treasury Branches Union Bank, Canada…
  28. January 2015 Investor Update – Long Run Exploration Ltd. – slide 28
    CORPORATE INFORMATION TSX:LRE Contacts Bill Andrew Chair & CEO (403) 2616012 Dale Miller President & COO (403) 2616012 Corine Bushfield Senior Vice President & CFO (403) 2616012 Dale Orton Senior Vice President, Development (403)…

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