Bank of America Merrill Lynch Global Energy Conference November 22, 2013
CORPORATE OVERVIEW Production (Q3 2013) 94,515 boe/d Reserves (2P Gross) 607 mmboe Reserve Life Index 17.5 years (1) Annual Dividend 1.20/share Annualized Total Return: Since Inception 18% (2) Since Jan 1, 2008 13% (3)…
VALUE PROPOSITION We believe that top performing companies all have the following attributes: Great assets Operational excellence Capital discipline Management that delivers results Strong balance sheet with financial flexibility…
STRATEGIC ADVANTAGE RISK MANAGED VALUE CREATION Strong Balance Sheet 200% Reserve Replacement with 1.1x Net Debt to Funds from Operations for the past 5 consecutive years Highly skilled One of the longestRLI compared to peers…
INCOME AND GROWTH ARC HAS DELIVERED BOTH Delivered 19% annualized total return since inception Paid out 4.8 billion in total dividends - 29.58/share Grown debt and dividend adjusted reserves & production by 10% annually The Montney…
PER SHARE GROWTH RESERVES AND PRODUCTION PER SHARE GROWTH Consistent growth in absolute and per share reserves and production over the past five years Production per thousand shares 2P Reserves per share Normalized per thousand…
SUSTAINABLE DIVIDEND 4.8 BILLION IN DIVIDENDS SINCE INCEPTION The dividend is a critical component of our business strategy Sustained dividend levels through commodity price cycles due to quality of assets, active hedging program and…
RISK MANAGED VALUE CREATION PRODUCTION GROWTH Forecast
2013 FORECAST 2013 PRODUCTION EXCEEDING EXPECTATIONS
2014 BUDGET
2014 CAPITAL BUDGET SETTING THE STAGE FOR 2015 PRODUCTION GROWTH 915 million capital program (196 gross operated wells) with significant spending on oil and liquids-rich gas and focused spending on low cost, high rate of return…
2014 CAPITAL BUDGET TARGETED 17% PRODUCTION GROWTH IN 2014 *** Risks to the plan: commodity prices, timing issues and cost pressures related to service sector demand for equipment and personnel, regulatory approvals and liquids…
FOCUS ON OIL AND LIQUIDS GROWING OIL AND LIQUIDS SINCE 2009 7% CAGR total Liquids production driven by 34% CAGR Montney liquids production 2009 2015 Forecast 5% CAGR in 2P Liquids reserves from 152 Mmbbls to 186 Mmbbls 2008-2012…
INVESTING IN NATURAL GAS GROWING OUR LOW COST GAS BUSINESS 15% CAGR total natural gas production driven by 33% CAGR Montney natural gas production 2009-2015 Forecast 26% CAGR in 2P Gas reserves from 1 Tcf to 2.5 Tcf 2008-2012…
ASSET OVERVIEW
ASSET OVERVIEW WESTERN CANADA Montney Growth Assets Base Assets Blueberry Attachie Tower Septimus Parkland Sunset/Sunrise Dawson Sundown Ante Creek Redwater Natural Gas Pembina Liquids-rich gas Hatton Crude…
MONTNEY LANDS WORLD CLASS RESOURCE NE BC Montney lands are a major growth engine. Significant opportunity to grow liquids production. Total BC Montney production of 237 mmcf/d natural gas and 3,100 bbls/d oil and liquids with…
ARC IN THE MONTNEY PACED DEVELOPMENT AND LONG-TERM VISION
NE BC MONTNEY GROWTH ASSETS RESERVES AND RESOURCES Corporate Reserves of 607 mmboe (186 mmbls liquids/ 2.5 Tcf gas) (1) Natural Gas Oil and Liquids Reserves Reserves Oil NGL 2.1 TCF 7.6 mmbbls 24.7mmbls Economic Contingent…
DAWSON World Class Asset
DAWSON ASSET DETAILS Net production (boe/d) Q3 2013 27,800 Liquids (bbls/d) 960 ARC 1-34 Compressor Gas (mmcf/d) 161 Station (45 mmcfd) Production split % (liquids/gas) 97% gas ARC 5-35 Gas Plant (120 mmcfd) Land (Montney net…
Dawson A Cash Flow Machine Grown production from approximately 50 mmcfe/d in 2009 to 165 mmcfe/d by mid 2012 Significant capital investment in 2009 - 2010, Dawson is now positioned to generate greater than 100 million of free cash…
DAWSON CONSISTENT TYPE CURVE GROWTH SINCE 2008 2014 type curve to remain the same as 2013. Expectations are to drill up core Dawson wells to keep plant full Using delineation data from pressure and rate performance the expectations…
DAWSON GAS MONTNEY DEVELOPMENT ECONOMICS Key Metrics DCET Capex per well (MM) 4.6 Reserves per well (Bcf) 7.1 IP (1 mo) (MMcf/d) 5.0 IP (12 mo) (MMcf/d) 4.8 Economics (85/bbl) 4/GJ 3/GJ IRR (% AT) 86% 55% Recycle Ratio 4.5…
PARKLAND/TOWER Liquids Rich Gas
PARKLAND/TOWER EVALUATING POTENTIAL AND DEVELOPING EXISTING LANDS Parkland Tower Tower Net production (boe/d) 8,600 1,600 - Q3 2013 Liquids (bbls/d) 920 1,180 Gas (mmcf/d) 46 2.5 Land (net sections) 23 57 ARC 3-09 Gas…
PARKLAND LAYERED WELL PERFORMANCE Drilled and completed 2 wells in upper sand of the Upper Montney and 1 well offset in the lower sand in 2011 All wells had similar IP, ranging from 4.7 5.1 MMcfd No pressure response between the upper…
TOWER/PARKLAND LAYERED DEVELOPMENT OPPORTUNITY Very thick Montney A 100 m
PARKLAND MONTNEY DEVELOPMENT ECONOMICS Key Metrics DCET Capex per well (MM) 5.0 Reserves per well (Bcfe) 5.8 IP (1 mo) (MMcf/d) 4.5 IP (12 mo) (MMcf/d) 3.3 Economics (85/bbl) 4/GJ 3/GJ IRR (% AT) 67% 48% Recycle Ratio 4.0…
TOWER NEW FACILITIES SETTING THE STAGE FOR GROWTH Production volumes limited due to liquid handling restrictions Two eight well development pads completed in 2013 4-3 pad average 30 day IP rate: 328 boe/d per well un- optimized;…
TOWER MONTNEY DEVELOPMENT ECONOMICS Key Metrics DCET Capex per well (MM) 5.9 Reserves per well (Mboe) 400 IP (1 mo) (boe/d) 440 IP (12 mo) (boe/d) 220 Economics (85/bbl) 4/GJ 3/GJ IRR (% AT) 30% 28% Recycle Ratio 3.6 3.5 All…
WEST MONTNEY Long-term Growth Opportunity
WEST MONTNEY ASSET DETAILS Blueberry Net production (boe/d) - Q3 2013 4,590 Liquids (bbls/d) 50 Gas (mmcf/d) 27.2 Land (net Montney sections) 275 Attachie Working Interest 90% Tower Reserves (2P mmboe) 131 Liquids (mmbbls)…
SUNRISE ENTERING THE DEVELOPMENT PHASE Net production (boe/d)- Q3 2013 3,470 Liquids (bbls/d) 0 Proposed ARC 13-36 Gas Plant Gas (mmcf/d) 20.8 (60 mmcfd) Land (net Montney sections) 24 Working Interest 86% Reserves (2P…
SUNRISE DEVELOPMENT PLANNING
SUNRISE OUTPERFORMING EXPECTATIONS Estimated Ultimate Recovery (EUR) is Cumulative Production + Forecast or GLJ 2P Reserves Sunrise production continues to provide confidence of higher gas recovery A 02-25 Hz MTYA Cum to Oct.31,…
SUNRISE SUNRISE DEVELOPMENT ECONOMICS Key Metrics DCET Capex per well (MM) 5.2 Reserves per well (Bcf) 11.0 IP (1 mo) (MMcf/d) 5.3 IP (12 mo) (MMcf/d) 4.8 Economics (85/bbl) 4/GJ 3/GJ IRR (% AT) 80% 50% Recycle Ratio 4.8 3.1…
ANTE CREEK A Montney Oil Success Story
ANTE CREEK ASSET DETAILS Net production (boe/d) Q3 2013 11,400 Liquids (bbls/d) 5,700 Gas (mmcf/d) 34 Production split % (liquids/gas) 50/50 ARC 10-07 Gas Plant (30 mmcfd) Land (Montney net sections) 332 Working Interest…
ANTE CREEK MONTNEY DEVELOPMENT ECONOMICS Key Metrics DCET Capex per well (MM) 3.9 Reserves per well (Mboe) 276 IP (1 mo) (boe/d) 357 IP (12 mo) (boe/d) 214 Economics (85/bbl) 4/GJ 3/GJ IRR (% AT) 55% 50% Recycle Ratio 3.0 2.8…
SUMMARY
WHY INVEST IN ARC Commitment to Deliver Income and Growth Exposure to well balanced portfolio of world class assets High rate of return liquids and natural gas assets Resource Plays and Conventional assets Growth and Cash Flow…
NE B.C. MONTNEY RESERVES AND RESOURCES The discussion in this presentation in respect of reserves and resources is subject to a number of cautionary statements, assumptions and risks as set forth below and elsewhere in this presentation.…
Definitions of Oil and Gas Reserves and Resources Reserves are estimated remaining quantities of oil and natural gas and related substances anticipated to be recoverable from known accumulations, as of a given date, based on the…
Definitions of Oil and Gas Reserves and Resources Economic Contingent Resources are those contingent resources which are currently economically recoverable. Undiscovered Petroleum Initially-In-Place (UPIIP) is that quantity of…
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