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Investor Update – Long Run Exploration Ltd.

Long Run Exploration Ltd. · Oct 1, 2014 · 38 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. Investor Update – Long Run Exploration Ltd. – slide 1
    INVESTOR UPDATE OCTOBER 2014 1
  2. Investor Update – Long Run Exploration Ltd. – slide 2
    LONG RUN PROFILE Lis3ng TSX:LRE Shares Outstanding 193.4 million Northern Gas ALBERTA Market Capitaliza3on 1.0 billion Liquidity Peace River Area 800,000 (shares/day; YTD) Q2 2014 Produc3on* 27,602 Boe/d Deep…
  3. Investor Update – Long Run Exploration Ltd. – slide 3
    CORPORATE STRATEGY Provide long-term value to shareholders with sustainable yield plus growth model where capital expenditures and dividends are funded through funds ow from operaGons Provide growth through controlled…
  4. Investor Update – Long Run Exploration Ltd. – slide 4
    STRATEGY - OPERATIONS Focus on strong capital eciencies within porRolio of properGes Improve recycle raGo through capital and operaGonal cost control Build and expand infrastructure to maximize operaGng eciencies and minimize…
  5. Investor Update – Long Run Exploration Ltd. – slide 5
    STRATEGY - FINANCE Ensure corporate sustainability by funding dividends and capital spending through funds ow from operaGons Execute nancial strategy without the aid of a dividend reinvestment program (DRIP) Target net debt…
  6. Investor Update – Long Run Exploration Ltd. – slide 6
    RESULTS AND TRACK RECORD Strong Reserve Growth 120 Reserve Growth 1 0.89 0.9 ConGnuous strong reserve 100 0.75 0.8 growth 0.7 80 Increased proved plus 0.6 0.52 probable reserves (P+P) 17% Boe/share…
  7. Investor Update – Long Run Exploration Ltd. – slide 7
    RESULTS AND TRACK RECORD Produc.on & Funds Flow Growth Produc3on Growth Funds Flow Growth 30,000 Implemented 0.08 80,000 0.60 New Management Dividend 0.074 0.56 Team New Management Implemented 0.069 Team Dividend 0.07…
  8. Investor Update – Long Run Exploration Ltd. – slide 8
    WHY A DIVIDEND Assets Long Runs proven and predictable assets support a sustainable total payout raGo People Highly experienced technical teams who are able to embrace new technologies, maximize resource recovery and take…
  9. Investor Update – Long Run Exploration Ltd. – slide 9
    PEER COMPARABLES 2014e Yield 2014e Total Payout Ra3o(1) 15% 125% 134 % 12% Total Payout Ra3o (%) 2014e Yield (%) 115% 116% 117% 11% Avg: 106% 113% 9% Avg: 6% 111% 9% 105% 108% 108% 105% 106% 106% 6%…
  10. Investor Update – Long Run Exploration Ltd. – slide 10
    RECENT ACTIVITIES 2014 Successful dividend implementaGon in January 2014 and 5% dividend increase in June 2014 Completed Deep Basin Cardium AcquisiGon on May 30, 2014 Sizeable entry point into an addiGonal core area in the Deep…
  11. Investor Update – Long Run Exploration Ltd. – slide 11
    ASSET BASE Peace River Area Montney 3ght oil 13,000 Boe/d Northern Gas (55%+ Oil & NGLs) (Bluesky) ALBERTA Edmonton Area Peace River Area Basal Viking 3ght oil (Montney) 7,800 Boe/d (75% Oil & NGLs) Deep Basin…
  12. Investor Update – Long Run Exploration Ltd. – slide 12
    ASSET BASE LOOKING FORWARD 2014 Upcoming Ac3vity Peace River Area 43 net Montney wells planned for 2014 EOR acGvity iniGated in 2013 with expansion planned for Q4 2014 Deep Basin Area Cardium property acquisiGons on May 30,…
  13. Investor Update – Long Run Exploration Ltd. – slide 13
    PEACE RIVER Normandville & Girouxville - Montney Plays ALBERTA Montney Gght oil development Normandville T79 950m verGcal well depth SubstanGal producGon growth in Normandville and Girouxville T77 Sept 2011 - 4,500…
  14. Investor Update – Long Run Exploration Ltd. – slide 14
    DEEP BASIN - PINE CREEK Cardium Play Cardium Gght oil development 1,800m - 1,900m verGcal well depth ALBERTA T56 High-quality, liquids-rich natural Pine Creek gas and light oil producGon (41o API) Bluesky…
  15. Investor Update – Long Run Exploration Ltd. – slide 15
    DEEP BASIN - WAPITI Cardium Play ALBERTA T70 Cardium Gght liquids-rich natural gas formaGon Elmworth Moderate depths T68 (1,000m - 1,600m verGcal well depth) Wapi3 Current producGon 4,100 Boe/d T66 (30%…
  16. Investor Update – Long Run Exploration Ltd. – slide 16
    EDMONTON AREA Redwater Viking Play ALBERTA T59 Basal Viking Gght oil development Redwater T58 700m verGcal well depth Current producGon 5,400 Boe/d T57 (85% liquids) Light oil (38o API) Strong netbacks, moderate…
  17. Investor Update – Long Run Exploration Ltd. – slide 17
    BOYER Natural Gas ALBERTA T110 Bluesky natural gas Current producGon - 17.5 MMcf/d T108 Shallow decline gas (8%/year) 690,000 net acres T106 Current drilling density less than 1.5 Boyer wells per secGon T104 70…
  18. Investor Update – Long Run Exploration Ltd. – slide 18
    CORE AREA OVERVIEW Peace River Redwater Long Run Deep Basin Deep Basin Northern Gas (Normandville (Redwater & Total - Pine Creek - Wapi3 (Boyer) & Girouxville) Bruderheim) (incl. minors) Current producGon 2,900 10,200…
  19. Investor Update – Long Run Exploration Ltd. – slide 19
    CORE AREA WELL ECONOMICS Peace River Deep Basin - Deep Basin - Redwater Montney Pine Creek Cardium Wapi3 Cardium Viking 250 350 410 72 IP 30 (Boe/d) (65% liquids) (56% liquids) (20% liquids) (91% liquids) 140 184 265 36…
  20. Investor Update – Long Run Exploration Ltd. – slide 20
    CORPORATE GUIDANCE Guidance(1) 2014 Post Acquisi3ons(2) ProducGon average (Boe/d) 32,100 Average producGon per share (Boe) 0.073 % oil and NGLs 50% Funds ow from operaGons ( million) 320 Funds ow from operaGons per…
  21. Investor Update – Long Run Exploration Ltd. – slide 21
    TYPE CURVES 250 80 Long Run Montney Hz Oil Long Run Viking Hz Oil 70 200 60 Total ProducGon (Boe/d) Total ProducGon (Bbl/d) 50 150 40 100 30 20 50 10 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18…
  22. Investor Update – Long Run Exploration Ltd. – slide 22
    ENHANCED OIL RECOVERY (EOR) Waterood Cost eecGve reserve Current Waterood Pilots addiGons Increases recovery of Area Forma3on Pilot Start Date Comments Injectors Lowers nding & development costs Proceeding with EOR…
  23. Investor Update – Long Run Exploration Ltd. – slide 23
    LONG RUN KEY VALUE DRIVERS Diversied asset base within the Western Canadian Sedimentary Basin; balanced between oil and natural gas producGon Asset base well posiGoned to support sustainable dividend model without dividend…
  24. Investor Update – Long Run Exploration Ltd. – slide 24
    APPENDIX 24
  25. Investor Update – Long Run Exploration Ltd. – slide 25
    2014 FORECAST NET CAPITAL SPENDING 2014 Post AcquisiGons* Capital Expenditures (MM) Well capital 170 Plants, FaciliGes, EOR 50 RecompleGons, G&G, Land, Abandonment 30 Capital Expenditures by Area Capital Expenditures 250…
  26. Investor Update – Long Run Exploration Ltd. – slide 26
    NETBACKS BY PLAY 2014 January to June Average Peace River Deep Basin - Deep Basin - Redwater Northern Montney Pine Creek(1) Wapi3(1) Viking Gas Average Produc3on (Boe/d) 10,730 930 4,350 6,350 2,890 17,337 26,613 % Liquids…
  27. Investor Update – Long Run Exploration Ltd. – slide 27
    RISK MANAGEMENT Costless Collars Volume Pricing July 1, 2014 December 31, 2014 2,000 Bbl/day WTI US 88.00 - 92.50/Bbl Financial hedges miGgate July 1, 2014 December 31, 2014 2,000 Bbl/day WTI US 88.00 - 92.60/Bbl risk…
  28. Investor Update – Long Run Exploration Ltd. – slide 28
    LONG RUN A&D TRANSACTIONS ACQUISITIONS DIVESTITURES Total Total Cost Produc3on Produc3on Date Area Date Area Proceeds (MM) (Boe/d) (Boe/d) (MM) West Central February 2013 Peace Area 7.5 100 December 2012 175.9 1,900…
  29. Investor Update – Long Run Exploration Ltd. – slide 29
    PEACE RIVER MONTNEY Normandville/Girouxville ALBERTA Current development focus areas Normandville T79 are Normandville and Girouxville Montney oil Normandville Oil Baqery IniGated water injecGon pilot in Q2 5,000…
  30. Investor Update – Long Run Exploration Ltd. – slide 30
    PEACE RIVER MONTNEY Have drilled 3 secGons at 8 wells per secGon Historical Type Curve spacing with no interference 250 200 Expanding water ood pilots in 2014. With success, full implementaGon will begin in 2015 &…
  31. Investor Update – Long Run Exploration Ltd. – slide 31
    DEEP BASIN PINE CREEK ALBERTA T56 Low risk oil development Pine Creek 13-09 LRE Baqery/ upside at Pine Creek Compressor Sta3on 6500 boe/d T55 13-19 LRE Mul3well Oil Baqery (100%) ExploraGon upside at North…
  32. Investor Update – Long Run Exploration Ltd. – slide 32
    DEEP BASIN - PINE CREEK CARDIUM Horizontal Type Curve Economics Historical Type Curve 500 80,500 net acres 400 50 booked locaGons Total ProducGon (Boe/d) 300 Average 81% working interest 200 100 0 1…
  33. Investor Update – Long Run Exploration Ltd. – slide 33
    DEEP BASIN - WAPITI CARDIUM Horizontal Type Curve Economics Historical Type Curve 500 Liquids-rich gas (40 bbl/mmcf) 400 Strong capital eciencies Total ProducGon (Boe/d) 75,000 net acres 300 96 booked…
  34. Investor Update – Long Run Exploration Ltd. – slide 34
    REDWATER VIKING 07-21 Redwater North Oil Baqery 5,000 bbls/d 4.0 mmcf/d T59 Viking oil horizontal mulG-frac play 05-17 Redwater North Compressor Sta3on Control of infrastructure to 4.5 mmcf/d Redwater T58 maximize…
  35. Investor Update – Long Run Exploration Ltd. – slide 35
    REDWATER VIKING Historical Type Curve Development drilling at 16 wells per secGon 80 for opGmal drainage 70 60 Implemented iniGal water injecGon scheme in Total ProducGon (bbl/d) 50 December 2013, expanding in 2014…
  36. Investor Update – Long Run Exploration Ltd. – slide 36
    CHERHILL Emerging Play ALBERTA Primarily targeGng Ban and Lower T60 Mannville formaGons T59 True verGcal depth of 1,000 - 1,500 meters T58 Current producGon of approximately 1,400 Boe/d (40% liquids) primarily…
  37. Investor Update – Long Run Exploration Ltd. – slide 37
    RESERVES SUMMARY Consensus Pricing WORKING INTEREST RESERVES (12/31/2013) Oil Gas NGL Total NPV00 NPV10 NPV15 FDC MBbls MMcf MBbls MBoe M M M M LRE PDP 12,997 130,593 2,310 37,073 923,929 691,192 620,982 - TP 24,676 207,633…
  38. Investor Update – Long Run Exploration Ltd. – slide 38
    CORPORATE INFORMATION TSX:LRE Contacts Bill Andrew Chair & CEO (403) 261-6012 Dale Miller President (403) 261-6012 Corine Busheld Vice President, Finance & CFO (403) 261-6012 Jason Fleury Vice President, Business…

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