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Corporate Presentation – Penn West Petroleum Ltd.

Penn West Petroleum Ltd. · Mar 31, 2014 · 37 slides

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Slides

  1. Corporate Presentation – Penn West Petroleum Ltd. – slide 1
    Corporate Presentation March 2014
  2. Corporate Presentation – Penn West Petroleum Ltd. – slide 2
    Corporate Summary Listing TSX: PWT NYSE: PWE Market Capitalization(1) 4.3 billion Big Hill Shares Outstanding(2) 490 million Liquidity(3) TSX: 2.5 million NYSE: 2.3 million 2014 Production Forecast(4) 101 - 106 mboe/d (66% liquids)…
  3. Corporate Presentation – Penn West Petroleum Ltd. – slide 3
    Penn West Value Proposition Maximize return to shareholders through efficient development and production of established light oil resources Focused Portfolio Target Best-in-Basin Operator Status Reliable Production Performance…
  4. Corporate Presentation – Penn West Petroleum Ltd. – slide 4
    2013 Financial & Operational Highlights Funds flow for Q4 was 216MM (0.44/sh) and 1.1B (2.17/sh) for the full year 2013 2013 netback improved 12% to 29.69/boe year-over-year Non-cash impairment charges of 790MM in the quarter…
  5. Corporate Presentation – Penn West Petroleum Ltd. – slide 5
    2013 Financial & Operational Highlights Sustainability ratio for 2013 was 112% and compares to 172% in 2012 Q4 capital was 208MM and 816MM for the full year 2013 which was below guidance of 900MM primarily due to cost reductions…
  6. Corporate Presentation – Penn West Petroleum Ltd. – slide 6
    Q4 Financial & Operating Highlights Funds Flow Bridge Production Bridge 350 150,000 310 133,712 293 Funds flow (MM) Production (boe/d) 130,000 2,716 123,995 270 (7,400) (2,201) (920) (1,912) 110,000 (44) 230 25 216 9…
  7. Corporate Presentation – Penn West Petroleum Ltd. – slide 7
    Q3 Q4 2013 Net Debt Bridge 3,500 62 208 16 3,250 3,223 219 3,000 (216) 54 2,860 Net Debt (MM) (18) 2,750 (473) 402 2,500 1,009 2,250 401 2,000 1,995 2,057 1,750 Q3 Unrealized Funds Capital Enviro Net…
  8. Corporate Presentation – Penn West Petroleum Ltd. – slide 8
    Quarterly Cash Costs 37.48/boe 33.48/boe 33.11/boe 34.57/boe 34.48/boe 600 500 Quarterly Cash Cost (000s) 400 G&A (net) Environmental Major R&M Workovers 300 Royalties 200 Transportation 100 Operating…
  9. Corporate Presentation – Penn West Petroleum Ltd. – slide 9
    2013 Reserves Highlights Proved(1): 415 MMboe High Quality Reserves Proved + Probable (2P)(1): 625 MMboe 72% Proved Developed Liquids account for approximately 70% of 2P reserves Producing Proved Reserves 415 MMboe Excluding impact…
  10. Corporate Presentation – Penn West Petroleum Ltd. – slide 10
    Light Oil Plan Resource Conversion Key Plays Light Oil Cardium 1,400 900 Prospective 800 Resources 1,200 Prospective Resources 700 Remaining Remaining 1,000 Resource 600 Resource (post long-term (post long-term Contingent 800…
  11. Corporate Presentation – Penn West Petroleum Ltd. – slide 11
    Play Performance Metrics Current Performance vs 2014 Budget and Long-Term Plan Targets Gross Well Count Over 95% of development capital is allocated in 500 these three core areas through the long-term plan 400 Slave Point Program…
  12. Corporate Presentation – Penn West Petroleum Ltd. – slide 12
    2014 Capital Budget Focused on Core Oil Resources & Balanced Across Quarters 2014 Capital Allocation(1) (MM) Corp / Other Focus of 2014 capital budget is on maximizing 47 Infrastructure / profitability and capital efficiency Major…
  13. Corporate Presentation – Penn West Petroleum Ltd. – slide 13
    Debt Capital Structure Senior Debt to EBITDA of 2.2 times at December 31, 2013 (1) Credit Syndicate Private Notes 3.0B capacity CAD2.1B private notes(2) 20 banks 4.5 years average remaining Expires June 30, 2016 6.1% coupon…
  14. Corporate Presentation – Penn West Petroleum Ltd. – slide 14
    Focus the Portfolio: A&D Strategy Timing Target Proceeds Initial non-core asset disposition Phase 1 - Debt repayment Completed 486MM - Focusing asset base Major portfolio repositioning and focus Completed 175MM - Debt…
  15. Corporate Presentation – Penn West Petroleum Ltd. – slide 15
    Focus the Portfolio: A&D Strategy Early Success Asset Divestitures Improve Penn Wests Portfolio s Phase 1: Closed December 20th, 2013 Proceeds of 486MM from non-core asset sales producing 10,800 boe/d (46% heavy oil, 35% natural gas,…
  16. Corporate Presentation – Penn West Petroleum Ltd. – slide 16
    Focus the Portfolio: A&D Strategy Divested Acreage Improves Focus on Core Light Oil Positions Phase 1: (Dec 20, 2013) Big Completed Hill Switchgrass 486MM; 10,800 boe/d Phase 2: (Mar 14, 2014) Completed 175MM; 6,700 boe/d…
  17. Corporate Presentation – Penn West Petroleum Ltd. – slide 17
    Assets Overview
  18. Corporate Presentation – Penn West Petroleum Ltd. – slide 18
    Cardium Development Profile Gaining Momentum in Canadas Largest Light Oil Resource Operated Development Net Production Adds & Capital(1) Gross Well Count(1) Cumulative Development Production 800 45 350 40 300 35 600…
  19. Corporate Presentation – Penn West Petroleum Ltd. – slide 19
    Cardium Trend Long-Term Development Plan T50 Cardium Capital Program (1) 800 Willesden Green Pembina 600 MM/year J Lease 400 Pembina 200 0 2014 2015 2016 2017 2018 Cardium Production(1) 60,000 Lodgepole…
  20. Corporate Presentation – Penn West Petroleum Ltd. – slide 20
    Cardium Key Attributes(1)(2)(3) Strategic Value & Potential(1)(2)(3) 600,000 net acres Working Interest (%) 65 650 MMboe contingent resources Booked Reserves (MMboe 2P YE 2013) 161 Dominant infrastructure position EUR Factor(1)…
  21. Corporate Presentation – Penn West Petroleum Ltd. – slide 21
    Cardium Crimson Lake & Unit 6 Long-Term Development Plan Crimson Lake Type Curve(1)(3) Penn West land 500 P10 PW drilled WGU 9 Penn West H2/13 program (4 wells) PW 2013 well 400 Penn West plan type curve PW 2014 well Industry T44…
  22. Corporate Presentation – Penn West Petroleum Ltd. – slide 22
    Cardium Lodgepole & PCU 9 Long-Term Development Plan Lodgepole Type Curve(1)(3) 300 T48 P10 Penn West H2/13 program (6 wells) PCU 9 Penn West plan type curve Industry 200 boe/d Penn West P50 100 P90 0 0 12 24 PCU 9…
  23. Corporate Presentation – Penn West Petroleum Ltd. – slide 23
    Cardium J Lease & Easyford Long-Term Development Plan J Lease Type Curve(1)(3) 300 P10 T50 250 Penn West plan type curve Industry Easyford 200 boe/d 150 100 P50 Penn West 50 P90 0 0 12 24 Months T49 J Lease Per…
  24. Corporate Presentation – Penn West Petroleum Ltd. – slide 24
    Viking Development Profile WCSB Leading Economic Returns Prioritized Operated Development Net Production Adds & Capital(1) Gross Well Count(1) Cumulative Development Production 160 10 120 140 9 8 100 120 Well…
  25. Corporate Presentation – Penn West Petroleum Ltd. – slide 25
    Viking Oil Long-Term Development Plan Viking Oil Hz Production 90 Comparison in Greater Dodsland(1)(3) R23 R20W3 80 Penn West H1/13 program (27 wells) 70 Penn West H2/13 program (32 wells) Penn West plan type curve 60 Industry…
  26. Corporate Presentation – Penn West Petroleum Ltd. – slide 26
    Viking Oil Key Attributes(1)(2)(3) 2014 Play Focus & Status(1)(2)(3) Working Interest (%) 92 Industry leader for production results Achieved competitive costs in early Q4 2013 Booked Reserves (MMboe 2P YE 2013) 31 Implement Avon…
  27. Corporate Presentation – Penn West Petroleum Ltd. – slide 27
    Slave Point Development Profile Extensive Light Oil Upside Potential Operated Development Net Production Adds & Capital(1) Gross Well Count(1) 450 16 80 Cumulative Development Production 400 14 70 350 12 60 Well…
  28. Corporate Presentation – Penn West Petroleum Ltd. – slide 28
    Slave Point Long-Term Development Plan Slave Point Capital Program (1) 450 400 Red Earth 350 Sawn Sawn R10W5 R7 300 Otter MM/year 250 200 Penn West land 150 100 PW 3D seismic 50 PW 2013 well 0 PW 2014 well 2014…
  29. Corporate Presentation – Penn West Petroleum Ltd. – slide 29
    Slave Point Key Attributes(1)(2)(3) 2014 Play Focus and Status(1)(2)(3) Low-Risk development drilling Working Interest (%) 95 - Otter 7 wells Booked Reserves (MMboe 2P YE 2013) 40 - Sawn 9 wells EUR Factor(1) (%) 14 26 - Red Earth…
  30. Corporate Presentation – Penn West Petroleum Ltd. – slide 30
    Slave Point Sawn Long-Term Development Plan R13W5 Sawn Type Curve(1) 3D seismic 400 Sawn type curve 3 kms 300 Penn West plan type curve Industry average 2 miles boe/d 200 100 0 0 6 12 18 24 30 Months Sawn Lake…
  31. Corporate Presentation – Penn West Petroleum Ltd. – slide 31
    Slave Point Otter Long-Term Development Plan Otter Type Curve(1) R10W5 250 200 150 boe/d 100 50 0 T88 0 12 24 Months Otter Wells Exceeding Budgeted Volumes(2)(3) 300 Water Flood expansion 250 Cumulative…
  32. Corporate Presentation – Penn West Petroleum Ltd. – slide 32
    Slave Point Red Earth Long-Term Development Plan R8W5 Red Earth Type Curve(1)(2) 3 kms 300 2 miles 200 boe/d 100 0 0 12 24 Months Red Earth is an under-developed reef facies analogous to Sawn 2 appraisal…
  33. Corporate Presentation – Penn West Petroleum Ltd. – slide 33
    Supplemental Information
  34. Corporate Presentation – Penn West Petroleum Ltd. – slide 34
    Price Realizations By Product Oil NGLs Natural Gas Q3 2013 Q4 2013 Q3 2013 Q4 2013 Q3 2013 Q4 2013 /bbl /bbl /bbl /bbl /mcf /mcf WTI or Henry Hub Benchmark US 105.80 97.50 105.80 97.50 3.55 3.85 Benchmark Differential US (4.80)…
  35. Corporate Presentation – Penn West Petroleum Ltd. – slide 35
    Hedging Position Current Balanced Financial Management Oil: H1/2014 - 20,000 bbls/d Swaps - US93.74/bbl H1/2014 - 10,000 bbls/d Collars - (US93.20/bbl x US101.00/bbl) Gas: 2014 - 90,000 mcf/d Swaps - 3.90/mcf 2014 - 50,000 mcf/d…
  36. Corporate Presentation – Penn West Petroleum Ltd. – slide 36
    2014 Budget Funds Flow Sensitivities Change Budget Change WTI Oil (US/bbl) - 10.00 + 10.00 92.50 Funds Flow Impact (CMM) - 123 + 135 Light Differential (US/bbl) - 10.00 + 10.00 - 5.55 Funds Flow Impact (CMM) - 195 + 193 AECO…
  37. Corporate Presentation – Penn West Petroleum Ltd. – slide 37
    Stock Exchange Investor Relations Toronto: PWT Clayton Paradis Manager, Investor Relations New York: PWE Telephone: (403) 539-6343 Email: clayton.paradispennwest.com Legal Counsel Burnet, Duckworth & Palmer LLP Toll Free: 1-888-770-2633…

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