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CORPORATE PRESENTATION – Arcan Resources Ltd.

Arcan Resources Ltd. · Jun 6, 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. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 1
    Long-Life Light Sweet Oil with Enhanced Waterflood Recovery Swan Hills Beaverhill Lake AGM June 6th, 2013 www.arcanresources.com
  2. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 2
    Agenda 1) Introduction 2) Company budget 3) Reserves 4) Operations 5) Waterflood 6) Debt structure and moving forward 7) Outlook 2014 and beyond www.arcanresources.com 2
  3. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 3
    Beaverhill Lake Light Oil Play Swan Hills Complex Swan Hills Complex Discovered in 1957 7 billion barrels OOIP Swan Hills Platform Complex (Original Oil in Place) Up to 40% recovery under waterflood 2.4 billion barrels…
  4. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 4
    Swan Hills Legacy Pools Historical Waterflood Recoveries Map highlights total cumulative water injected R12 R11 R10 R9 R8 R7W5 T71 G 12 7 G 8 9 10 G G G 11 12 7 8 9 10 11 12 7 8 G 9 G 10 11 12 G 7 G U…
  5. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 5
    Beaverhill Lake Light Oil Play Swan Hills Platform Arcan Lands R10 R9 R8 R7W5 3 2 1 6 J 5 4 3 2 V E1 6 5 U 4 3 2 1 6 5 4 T69 A A E E T69 J I E I V A E I C E V E E V E S M U E S G U E E E S E U EE I EC Reef Margin E U J V…
  6. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 6
    Arcan Historical Drilling Activity R10 V R9 R8 R7W5 2012 Activity E E E V I J IV E E C EU G I V J M V J G I V E1 E F J C E I D M T69 3 2 A 1 6 5 4 3 2 A 6 E 5 E 4 3 2 1 6 5 4 T69 E I V A E I C E E E V…
  7. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 7
    Arcan 2013 Remaining Drilling Activity Ethel (1) R10 R9 R8 R7W5 3 2 1 6 J 5 4 3 2 V E1 6 5 U 4 3 2 1 6 5 4 T69 A A E E T69 J I E I V A E I C E V E E V E S M U E S G U E E E S E U EE I J V E E M G E EC U EJ E 31 E VE…
  8. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 8
    2013 Capital Budget & Guidance 2013 capital estimate = 52 million (MM) Production Estimated 2013 annual average 4,300 to 4,700 boe/d 2013 cash flow estimated at 52 MM* Q1 2013 4,098 boe/d Q2 2013 4,000 to 4,200 boe/d (estimated)…
  9. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 9
    Reserves Adjusted Year End Reserves (Mboe)* Year End NPV10 (MM) 45 900 829 * 2011 is net of dispositions 38.7 40 800 35.3 35 700 612 30 600 490 Boe (MM) Boe (MM) 25 23.4 500 18.6 399 20 400 294 278 15 11.4 300…
  10. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 10
    Production Arcan Corporate Production 7,000 70% of current Arcan production added during 2011 & 2012 Current corporate base decline moderated to 30 35% 6,000 5,000 4,000 BOE/day 3,000 2,000 1,000 0 1-Jan-11…
  11. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 11
    Capital Efficiency Production vs. Capital 120.0 6,000 100.0 5,000 Production (boe/d) 80.0 4,000 Capital (MM) 60.0 3,000 40.0 2,000 20.0 1,000 0.0 - Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1…
  12. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 12
    Recent Results Arcan Horizontal Type Well & Actual Performance (Calendar Day Rates) 400 350 300 New well average 250 Oil Production bbls/d Arcan average 200 horizontal well 150 100 50 0 1 2 3 4 5 6 7 8 9 10 11…
  13. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 13
    Operating Expenses Operating Expenses/BOE 24.00 23.00 22.00 22.35 21.00 OpEx/BOE 20.00 20.08 19.00 18.00 17.00 17.52 16.00 15.00 14.00 2011 2012 2013 Operating Expenses Target Budget Reduction in operating expenses…
  14. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 14
    General and Administrative Expense G&A Expenses/BOE 9.00 8.00 0.67 2.18 7.00 7.66 6.00 6.15 5.00 1.95 4.00 3.00 3.74 2.00 1.00 - 2011 2012 Q1 2013 Arcan G&A/BOE Stimsol G&A/BOE Efforts being taken to reduce G&A…
  15. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 15
    Operating Netbacks Operating Netback/BOE 90.00 80.00 16.32 13.65 Realized Price / BOE 12.60 70.00 60.00 22.35 17.52 20.08 50.00 53.43 40.00 49.12 48.36 30.00 20.00 10.00 - 2011 2012 Q1 2013 Operating Netback/BOE…
  16. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 16
    Waterflood Enhanced Recovery What do you need for a successful waterflood Reservoir continuity Favorable reservoir characteristics Contiguous land Large volumes of oil in place Water source Infrastructure Patience What do you…
  17. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 17
    Waterflood Enhanced Recovery Deer Mountain and Ethel Floods R9 U R8 R7W5 Deer Mountain Enhanced Recovery E E S E E C UU E E E E VV E S E 36 31 32 UU 33 34 35 36 31 G E E G J C E C E 5,920 acres (9.25 sections) 81% WI G…
  18. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 18
    Deer Mountain Waterflood R9 R8W5 V T69 E 1 E F J C E 6 DI M E C 5 EU 4 3 2 T69 30 producers (15 horizontal & 15 vertical) A E E E S E M S G E 18 injectors (3 horizontal & 15 vertical) E E E E C U E E U E E…
  19. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 19
    Waterflood Enhanced Recovery Deer Mountain and Ethel Floods R9 U R8 R7W5 Ethel Enhanced Recovery E E S E E C UU E E E E VV E S E 36 31 32 UU 33 34 35 36 31 G E E G J C E C E 5,920 acres (9.25 sections) 100% WI G G S VE…
  20. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 20
    Ethel ER Scheme Wells & Waterflood Activity V V R9 R8 R7W5 E V G 14 13 18 17 16 15 14 13 18 A E VV E E E E VUU I 19 horizontal producers J G G A 11 12 7 8 9 10 11 12 7 C E A T68 T68 6 injectors (four…
  21. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 21
    Future Waterflood Lands Beyond Deer Mountain Unit 2 and Ethel floods R10 R9 R8 R7W5 3 2 1 6 J 5 4 3 2 V E1 6 5 U 4 3 2 1 6 5 4 A A E E Deer Mountain Unit 2 and Ethel T69 T69 J I E I V A E I C E V E E V E S M U E S G 34 J…
  22. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 22
    Debt Structure and Mitigation Two components to Arcans debt: 1. 169 MM currently drawn on a credit facility of 190 MM 2. Two convertible debentures: 86 MM maturing February 2016 85 MM maturing October 2018 How does Arcan plan to…
  23. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 23
    Strategic Initiatives What we said we would do: Results to date: Increase Capital Efficiency 20% drop in drilling costs Lower Operating Costs 27% drop in operating costs since Q3 2012 Stay within Cash Flow On track to deliver…
  24. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 24
    2014 and Beyond Activity and capital requirements scheduled to match cash flow Flexible 2014 program, capital requirements may range from 35 to 95 MM Realize benefits of waterflood supported production growth Continued…
  25. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 25
    Arcan Resources Ltd. Long Life, Light Oil Producer 96% light sweet crude Significant upside in waterflood enhanced recovery proven by offsetting analogs Improved operating efficiencies and increased corporate netbacks Lower cost…
  26. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 26
    Appendix www.arcanresources.com
  27. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 27
    Corporate Information BOARD OF DIRECTORS BANKING SYNDICATE Alberta Treasury Branch Michael J. Laffin Bank of Nova Scotia Chairman CIBC National Bank of Canada Douglas Penner Royal Bank of Canada President, Arcan Resources Ltd. J.…
  28. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 28
    Capitalization Shares Basic 97,860,013 Stock Options (Avg. 3.76) 2,206,501 Fully Diluted 100,066,514 3% Basic Inside Ownership 4% Fully Diluted Syndicated Credit Facility 190 million 2016 6.25% - 86 million Convertible…
  29. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 29
    Management J. Terry McCoy, P. Geol Chief Executive Officer Director Mr. McCoy is the chief executive officer, providing executive leadership, direction and support for the management of Arcan. He draws on more than 40 years of experience…
  30. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 30
    Management Andy Fisher, B.Comm. PLM Executive Vice President Mr. Fisher is a founder of Arcan. As the vice president, he plays an active role in monitoring operations and coordinating the activities of various departments within the…
  31. CORPORATE PRESENTATION – Arcan Resources Ltd. – slide 31
    Board of Directors Michael J. Laffin, MPA, LL.B. Chairman Mr. Laffin has over 30 years of experience in the oil & gas industry, primarily as a lawyer, but also in the business economics, reservoir engineering and land departments of a…

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