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INVESTOR PRESENTATION – Baytex Energy Corp.

Baytex Energy Corp. · Apr 18, 2013 · 48 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 PRESENTATION – Baytex Energy Corp. – slide 1
    April Presentation
  2. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 2
    Investment Highlights Focus on per-share growth in production and reserves Organic Oil Growth Long-term, Low-Cost Inventory Sector-leading capital efficiency Operational excellence Meaningful Dividend Focus on dividend growth…
  3. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 3
    Corporate Profile Summary of Securities Trading Symbol TSX / NYSE: BTE Average Daily Volume (1) TSX: 711,500 / NYSE: 173,700 Shares Outstanding (Current) 122.7 million Market Capitalization / Enterprise Value 5.2 billion / 5.8…
  4. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 4
    Operating Areas 7
  5. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 5
    Corporate Growth Strategy Exploit existing oil assets at Peace River (multi-lateral wells), Lloydminster (growing use of horizontal wells) and North Dakota (Bakken-Three Forks development) Near Term (1-2 years) Cold Development…
  6. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 6
    Oil-Equivalent Production Growth (1) Percent Oil 73% 71% 73% 76% 77% 76% 79% 84% 87% 89% (1) Based on mid-point of guidance range of 56,000 58,000 boe/d. Gas converted to oil-equivalent at 6 mcf: 1 boe. 9
  7. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 7
    Reserve Growth / Contingent Resources 292 229 252 187 197 168 141 146 107 123 2P RLI (years) 8.0 9.5 10.1 11.5 11.7 12.2 12.6 13.9 13.0 14.5 Oil Weighting 83% 78% 79% 83% 85% 84% 89% 91% 92% 93% Low (C1) 622 MMboe…
  8. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 8
    Balance Sheet Strength ( millions) Q4 2012 Credit Facilities Bank Loan (1) 117 Long-Term Debt (2) 449 Working Capital Deficiency 34 Total Monetary Debt 600 Debt to EBITDA (3) 0.8x Debt to FFO (3) 1.1x Balance Sheet…
  9. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 9
    2013 Oil Marketing Portfolio Heavy Oil Sales Portfolio WTI Hedging Q1 / 2013 % Hedged 47% Fixed Price US98.46/bbl FY 2013 % Hedged 44% Fixed Price US98.12/bbl Percentage of hedged volumes are based on Heavy oil sales…
  10. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 10
    Marketing Transportation Options Trucking Flexibility Rail a Key Component of Market Access - Optimizes value of production - Initially expected rail to comprise 10% of our sales portfolio - Helps mitigate downstream upsets - Has…
  11. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 11
    Key Projects Overview 14
  12. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 12
    Peace River Oil Sands 306 net sections of oil sands leases; 551 million barrels of contingent resource * Primary Development Production (Q4/12) 20,600 bbl/d 2P Reserves (YE12) 64 mmbbls Project Inventory(1) 238 net…
  13. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 13
    Peace River Multi-Lateral Cold Horizontal Primary (Cold) Development (1) Well Design 8-10 laterals Completed Well Cost 2.6-3.4 MM Production (30-day IP) 300-700 bbl/d EUR 275-550 mbbl Capital Efficiency 5,000-9,000 per bbl/d…
  14. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 14
    Peace River Production Performance Production Performance (1) (1) Production performance and well count represents Baytex drilling at Harmon Valley and West Harmon Valley (excluding infill wells). 17
  15. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 15
    Peace River Cliffdale Thermal EOR Development Recovery per 15-well Module (Baytex estimates based on Cliffdale pilot) - CAPEX = 55 million - Recovery factor 30% based on numerical reservoir simulation - Oil rate = 2,000 bbl/d…
  16. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 16
    Peace River - Cliffdale Development Operation of first commercial 10-well module commenced in December 2011 Construction of 15-well module to commence in Q1/13 with drilling in Q3/13 10-Well Module Q4/12 Update Average…
  17. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 17
    Cliffdale 1 Cycle Progression 30,000 Cumulative Oil Production for Each 25,000 Steam Volume = 61,100 BW Cycle SOR = 2.4 Peak Weekly Rate = 336 bbl/d 20,000 Steam Volume = 26,100 BW Cycle SOR = 1.8 Cycle (bbls) Peak…
  18. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 18
    Peace River Oil Sands Low Environmental Impact Baytex Cliffdale Thermal Project Non-Mining Oil Sands Development 21
  19. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 19
    Lloydminster Lloydminster Heavy Oil Heavy Oil 730 net sections; 217 million barrels of contingent resource * Area Statistics Production (Q4/12) 19,300 bbl/d 2P Reserves (YE12) 116 mmbbls Oil Gravity 11 to 18 API Drilling Inventory 6…
  20. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 20
    Lloydminster Development Vertical Wells Completed Well Cost 450,000 Production (30-day IP) 30-50 bbl/d EUR 30-50 mbbl Project Inventory (1) 200 net locations Capital Efficiency 11,250 per bbl/day Development Cost 11.25/bbl…
  21. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 21
    Bakken / Three Forks Development 126 net sections; 27 million barrels of contingent resource * SASKATCHEWAN Bakken-Three Forks Baytex Lands Production (Q4/12) 2,600 bbl/d 2P Reserves (YE12) 34 mmbbl NORTH DAKOTA Sheridan North…
  22. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 22
    Bakken / Three Forks Development Current development predominantly in the Three Forks formation Additional potential to develop Middle Bakken Evolution of frac staging: initially 6 stages/well 20 stages/well in 2011 30+…
  23. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 23
    North America Resource Play Comparables Half Cycle Payouts The above chart represents the Top North American Resource Plays as ranked by Peters & Co., as at January 2013. Commodity assumptions: 2013: WTI oil US97.11/bbl, NYMEX gas…
  24. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 24
    North America Resource Play Comparables Rate of Return The above chart represents the Top North American Resource Plays as ranked by Peters & Co., as at January 2013. Commodity assumptions: 2013: WTI oil US97.11/bbl, NYMEX gas…
  25. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 25
    Corporate Growth Strategy
  26. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 26
    2013 Operating Plans Targeting 8% Oil Growth Conventional Development 2013 Capital Budget and Wells Drilled - 430 million for conventional development Target production of 56,000 to 58,000 boe/d. Amount Wells Drilled ( millions)…
  27. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 27
    Corporate Growth Strategy Long Range Plan Production (boe/d) Drilling Plan: 2013 - 2017 (total of net wells) Peace River Region: 8% CAGR - Oil Multi-lateral wells (8-10 laterals) 238 6% CAGR Boe Thermal (CSS) 110 Lloydminster…
  28. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 28
    Why Invest in Baytex Superior Asset Base Income Payout Proven Track Record - Low cost development - Committed to paying a - Best-in-class balance sheet inventory oil focus meaningful dividend - Sophisticated risk - Sector leading…
  29. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 29
    Supplementary Information - Oil Projects 32
  30. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 30
    Cold Lake SAGD Acquisition 120 million purchase closed COLD LAKE / ARDMORE October 2, 2012 SUGDEN 100% W.I. in approximately 46 sections of oil sands leases Regulatory approval received for a LINDBERGH commercial SAGD…
  31. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 31
    Cold Lake SAGD Reservoir Characteristics GP Channel - Viscosity: 40,000 - 120,000 c.p. - Porosity: 36% - Depth: 375 metres - Permeability: 3 darcies - Channel Thickness: 30 metres - Bitumen Saturation: 80% - Average Clean Net…
  32. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 32
    Supplementary Information - Financial 35
  33. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 33
    Share Ownership Breakdown Ownership Breakdown Institutional 77% Retail 21% Europe/Asia - Institutional 5% Insiders 2% Insiders 2% US - Retail 5% 100% Canada 74% US - Institutional 14% Canada - Institutional 58% U.S. 19%…
  34. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 34
    2013E Funds From Operations (C mm) and Debt to FFO Heavy Oil Differential (% of WTI) 18% 23% 28% WTI (US/bbl) 80 531 (1.4x) 498 (1.6x) 465 (1.8x) 90 591 (1.2x) 552 (1.4x) 514 (1.5x) 100 646 (1.0x) 605 (1.2x) 563 (1.3x)…
  35. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 35
    2013E Funds From Operations Sensitivities Funds From Operations Impact (C Millions) With Current Without Hedges Hedges WTI +/- US1.00/bbl 11.9 14.8 Natural Gas +/- C0.25/mcf 3.0 3.3 Heavy Oil Differential +/- 1% 10.6 15.2…
  36. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 36
    Distribution / Dividend History Payout Ratio - Net of DRIP (% ) Monthly Dividend (C) Payout Ratio - Before DRIP (% ) 120% 0.30 100% 0.25 Payout Ratio (Percent of FFO) Monthly Dividend (C) 80% 0.20 60% 0.15 40% 0.10…
  37. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 37
    Capital Program Efficiency 3-Year 5-Year Average Average 2010 2011 2012 2010-12 2008-12 FD&A Cost (P + P) (1) Excluding FDC (C/boe) 5.90 12.46 4.19 7.05 8.60 Including FDC (C/boe) 13.17 18.57 11.61 14.06 15.22 Recycle Ratio (P…
  38. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 38
    Per Share Metrics For Comparison to Non-Dividend Paying Companies Debt and Dividend Adjusted CAGR 1-Year 3-Year 5-Year Long-Term Oil Reserves (bbl/share) 14% 17% 15% 15% Total Reserves (boe/share) 12% 16% 13% 13% Oil Production…
  39. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 39
    Other Commodities / FOREX Hedge Coverage 42
  40. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 40
    Appendix: Heavy Oil Pricing 43
  41. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 41
    Heavy Oil Differential Summer (high demand) season (Apr Sep) Winter (low demand) season (Oct Mar) 60 50 Lloyd Blend Differential (% of WTI Price) 40 2013 Hedges 30 20 10 0 2006 2007 2008 2009 2010 2011 2012…
  42. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 42
    Midstream Heavy Oil Fundamentals Infrastructure Development Source: Canadian Association of Petroleum Producers Crude Oil Forecast, Markets and Pipelines Report, June 2012. 45
  43. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 43
    Midstream Heavy Oil Fundamentals Near-Term Pipeline Projects: Enbridge Mainline 1. Toledo (Line 17) Partial Twin: 80,000 bbl/d Early-2013 2. Line 9 Reversal: 240,000 bbl/d Early-2014 3. Line 5 Expansion: 50,000 bbl/d Early-2013 4.…
  44. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 44
    Midstream Heavy Oil Fundamentals Near-Term Pipeline Projects: Seaway and Flanagan South Source: Enbridge 47
  45. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 45
    Midstream Heavy Oil Fundamentals Crude Oil Rail Exports North Dakota Western Canada 600 J.P. Morgan YE13 Estimate 500 (400 mbbl/d load capacity) 400 YE13 Estimate based Mbbl/d on North Dakota experience (300 mbbl/d load…
  46. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 46
    WCSB Heavy Oil Production / Potential Midstream Capacity 4,000 3,500 Heavy Oil to Market (mbbls/day) TransMtn Expansion (mid-2017) - 450kbd 3,000 Blended Heavy Production Forecasts Keystone XL (mid-2015) - 400kbd (PIRA /…
  47. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 47
    US Gulf Coast Heavy US Gulf Coast Heavy Oil Demand Oil Demand U.S. imports of Canadian heavy oil Total U.S. heavy oil imports were averaged 1.44 million bbl/d in 2012 4.0 million barrels per day in 2012. (increase of 94,000 bbl/d…
  48. INVESTOR PRESENTATION – Baytex Energy Corp. – slide 48
    Portfolio Management of Differentials Canadian heavy oil differentials: market developments and outlook WCS volatility has been caused by a combination of factors: 250,000 +/- bbl/d drop in US Midwest refinery runs in Oct-Nov 2012…

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