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TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited

Canadian Oil Sands Limited · Jan 12, 2015 · 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. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 1
    TD Securities London Energy Conference January 12-13, 2015 Ryan Kubik President & Chief Executive Officer
  2. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 2
    Overview 1. Syncrude resource base 2. 2015 outlook 3. Debt and liquidity 4. Approach to dividends 5. 2015 focus areas at Syncrude 6. Market access and SCO pricing 7. Relative valuation
  3. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 3
    Syncrude: A High Quality Resource Established production base Fully upgraded light, sweet crude oil Proven operator and proven technology Predictable reservoir recovery over 90% Non-declining production profile 40+ year 2P…
  4. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 4
    2015 Outlook 1 millions /barrel /share Sales 3,074 81.23 Operating expenses 1,729 45.69 Crown royalties 176 4.65 Other expenses 2 319 8.43 Current taxes 120 3.17 Cash flow from operations 730 19.29 1.51 Capital expenditures…
  5. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 5
    Oil Price Sensitivity 1 Cash flow from operations (per share) Current 2015 Outlook 1 2.06 1.51 0.95 2015F 2015F 2015F USD 65/bbl WTI USD 75/bbl WTI USD 85/bbl WTI 1. Based on assumptions contained in 2015 Guidance issued…
  6. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 6
    Break-even cost CAD /barrel Operating expenses 1 46 Capital expenditures 2 10-13 Crown royalties 3 2-3 Development expenses4 and reclamation 3-4 Syncrude break-even cost 61-66 US51 - US56/bbl 5 COS interest, administration, insurance…
  7. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 7
    Significantly Lower Capex Requirements millions, net to Canadian Oil Sands 1400 Major Projects 1200 Regular Maintenance 1000 800 600 400 200 0 2011 2012 2013 2014E 2015E 2016 F Capital costs only; excludes capitalized…
  8. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 8
    Dividends Reflect Free Cash Flow Over Time (1,2) millions Annual Total Dividends Cumulative Dividends/FCF 1. Includes distributions on trust units prior to Dec. 31/10 2. Free cash flow (FCF) is cash flow from operations less…
  9. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 9
    Strong Liquidity Position Net debt target of 1 2 billion - net debt is expected to be 1.9 billion at the end of 2014 Bond portfolio of USD 1.5 billion - next maturity in 2019 - maintain debt-to-total capitalization of less than…
  10. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 10
    Focused on Operational Performance 2013-14 accomplishments: Replacing/rebuilding mine train equipment completed in Q4 2014 Retrofitting and reconfiguring centrifuges to improve bitumen feed to upgrader completed in Q1 2014…
  11. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 11
    2015 Focus Areas Fully commission new Mildred Lake Mine trains and demonstrate design rates Upgrading implement design improvements to CO boilers and modifications to Flue Gas Desulphurizer Progress scoping and design of new…
  12. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 12
    High Value Syncrude Barrel 2 3 2 29 28 16 Syncrude barrel has larger cuts 37 37 48 of the premium priced 25 26 33 fractions 8 6 1 WTI Bakken Syncrude SCO LPG Naptha Distillate VGO Resid Value (as % of crude price) 65%…
  13. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 13
    Markets for COS Syncrude Production Kitimat Syncrude Edmonton Burnaby Hardisty Quebec City Montreal Sarnia Chicago Patoka Cushing Current synthetic crude oil markets Houston Potential new markets
  14. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 14
    Crude Oil to Remain a Key Component of World Energy Demand Global energy needs expected to increase by 30% Oil use is expected to increase 13% to 101 million barrels per day Source: International Energy Agency, World Energy Outlook…
  15. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 15
    COS Demonstrates Compelling Valuation Per flowing bbl of capacity 140,000 COS enterprise value 120,000 reflects mine infrastructure PLUS: 100,000 Upgrader producing light, 80,000 sweet crude oil 60,000 All of our reserves and…
  16. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 16
    Appendix Follow us: Twitter cdnoilsands www.blog.cdnoilsands.com
  17. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 17
    COS: A Premier Pure-play Oil Sands Investment Ticker: COS on Toronto Stock Exchange Shares outstanding: 484.6 million1 52 week high / low / close1: 24.69/ 7.74 / 7.94 Market cap: 3.8 billion1 Enterprise value: 5.6 billion2…
  18. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 18
    Syncrude Joint Venture Structure Canadian Oil Sands Imperial Oil 25% (COS) 36.74% Suncor 12% 5% 7.23% Murphy Oil Sinopec Nexen Mocal (CNOOC) (JX Nippon) ExxonMobil and Imperial provide global best practices,…
  19. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 19
    Demonstrating Strong Return on Shareholders Equity Canadian Oil Sands' ROE 45% 45.00 40% 40.00 35% 35.00 Percentage Return 30% 30.00 Return on Equity 25% 25.00 Average ROE of 24% 20% 20.00 15% 15.00 Average Share Price…
  20. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 20
    Mildred Lake Extension (MLX)
  21. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 21
    Syncrude Crown Royalty Terms* All figures gross to Syncrude Greater of 25% net bitumen revenue less capital and operating costs, or 1% of gross bitumen revenue* Previously based on Synthetic Crude Oil (upgraded from bitumen) revenues…
  22. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 22
    2015 Crown Royalty Calculation Based on 2015 Outlook provided December 3/14 SCO % Mining Bitumen Revenue1 3,074 2,277 Operating expenses (1,729) 85% (1,469) Development expense (169) 70% (118) Capital expenditures3 (529) 60% (318)…
  23. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 23
    Quality and Location Differentials Cdn /bbl Trailing 3-Month Average 130 120 110 100 Brent 90 SCO WTI 80 WCS Bitumen 70 60 50 40 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13…
  24. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 24
    Canadian & US Crude Oil Pipeline Proposals Source: CAPP
  25. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 25
    Canadian Pipeline Capacity vs 2014 Supply Forecast Enbridge Mainline PADD IV Trans Mountain Express Source: CAPP
  26. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 26
    Syncrude: A Leader in Responsible Oil Sands Development Reflects industry best practices Aboriginal relations Mining Association Toward Sustainable Mining Recognized with Gold Level accreditation by the Canadian Council of Aboriginal…
  27. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 27
    Wells-to-Wheels CO2 Emissions Average oil sands is only 9% more GHG intensive than average U.S. barrel Source: IHS CERA Special Report Oil Sands Dialogue: Oil Sands, Greenhouse Gases, and US Oil Supply: Getting the Numbers…
  28. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 28
    International Comparison of Leading Oil and Gas Producing Regions1 An independent study compared Alberta, Canada with other world-class oil producing regions around the world in terms of their environmental policies, laws and regulatory…
  29. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 29
    Stringency How Comprehensive are the Environmental Laws Stringency Factors: Requirements, time and costs for project approvals Number of regulators reviewing applications Opportunities for public to review and comment…
  30. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 30
    Transparency How Easily Can the Public Get Information Transparency Factors: Public access to project and/or facility information Monitoring reports and closure plans Stakeholder engagement processes and requirements Government…
  31. TD SECURITIES LONDON ENERGY CONFERENCE – Canadian Oil Sands Limited – slide 31
    Compliance Which Country Has Rules to Ensure Compliance Compliance Factors: Mechanisms to monitor compliance Consequences for non-compliance or non-performance Enforcement of regulations, penalties, default rates, approval…

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