Corporate Presentation August 2016
Future Oriented Information (See additional advisories at the end of this document) • In the interest of providing information regarding Paramount Resources Ltd. ("Paramount" or the "Company") and its future plans and operations, this presentation contains certain forward-looking information and forward-looking statements. • The projections, estimates and forecasts contained in such forward-looking information and statements necessarily involve a number of assumptions, and are subject to both known and unknown risks and uncertainties that may cause the Company's actual performance and financial results in future periods to differ materially from these projections, estimates or forecasts. The Advisories Appendix lists some of the material assumptions, risks and uncertainties that these projections, estimates and forecasts are based on and are subject to. • Accordingly, shareholders and potential investors are cautioned that events or circumstances could cause actual results to differ materially from those predicted. • Any use of information contained in this presentation is expressly forbidden. 2
Corporate Profile Corporate Profile Strategic Investments/Emerging Plays • Founded in 1976; IPO in 1978; TSX: POU • Emerging Montney plays at Valhalla and Birch • Emerging Duvernay play at Willesden Green • H1 2016 production: ~45,500 Boe/d (~ 48% Liquids) • Oil Sands • Pro-Forma July production: ~ 10,500 Boe/d (1)(2) • Liard Basin shale gas (~ 30% Liquids) • Frontier gas in northern Canada (MGM) • Market Cap: 106.2 MM shares @ $13.00/share • Equity investments portfolio ~ $1.4 Billion • ~ 50% insider ownership • Investment Portfolio: $1.3 Billion • Net Debt (June 30, 2016): $1.4 Billion (pro-forma: ~ $300 Million) (1) Estimated (2) Excluding Musreau/Kakwa assets sold in August 2016. 3
Summary of Musreau/Kakwa Sale Transaction $2.1 Billion • ~ $0.5 Billion Cash • Assumption of US$450 MM 2023 Notes • 33.5 MM shares of Seven Generations: ~ $1.0 Billion Sold • ~ 30,000 Boe/d Sales Volumes (1) • 295 MMBoe P+P Reserves (2) • $535 Million PDP NPV @10% (2) • $2.2 Billion FDC P+P (2) • 310 net sections, including 155 net Montney sections Full Cycle Value Capital spent from inception: ($2,220 MM) Netback $680 MM Sale of Midstream to Pembina (3) $575 MM Sale to Seven Generations $2,065 MM Full Cycle Value Realized $1,100 MM (1)(2)Please refer to the heading “Summary of Musreau/Kakwa Sale Transaction (Slide 4)” in the Advisories Appendix of this presentation for more information. (3) Also includes proceeds from other minor property dispositions. 4
Karr/Gold Creek Cretaceous and Montney targets • ~ 61 sections (~ 48 net) Cretaceous • ~ 95 sections (~ 80 net) Montney rights • July Sales: ~ 4,700 Boe/d (net) (1) • 40 MMcf/d plant capacity currently being expanded to 80+ MMcf/d (Q2 2017 completion) • Two rig drilling program currently underway (1) Estimated 5
Karr Economics: Montney Assumptions: Economics @ $2.50/GJ AECO Capital: $8.6 MM d/c/e/t US$/Bbl WTI $40 $45 $50 $55 $60 IP 30 (raw): 6.2 MMcf/d NPV 10% $MM 3.5 4.9 6.3 7.6 8.9 Raw Natural Gas EUR: 5.0 Bcf IRR (%) 29 39 51 64 78 Stabilized Condensate EUR: 360 MBbl Payout (Years) 2.7 2.2 1.8 1.5 1.4 Total Sales per Well: 1.2 MMBoe CGR(raw): 135 Bbl/MMcf (IP 30 ) P/I @ 10% 1.4 1.6 1.7 1.9 2.1 FX (USD/CAD): $0.75 EUR denotes estimated ultimate recovery. 6
Smoky/Resthaven Cretaceous and Montney targets • ~151 sections (~ 101 net) Cretaceous • ~76 sections (~ 74 net) Montney rights • Paramount owns 54 MMcf/d (~ 18%) of the Smoky Deep Cut facility and 10 MMcf/d (50%) of the Resthaven facility • July Sales: ~ 1,800 Boe/d (net) (1) (1) Estimated, July sales volumes were impacted by plant outages 7
Smoky/Resthaven Economics: Montney Assumptions: Economics @ $2.50/ GJ AECO Capital: $9.0 MM d/c/e/t US$/Bbl WTI $40 $45 $50 $55 $60 IP 30 (raw): 3.4 MMcf/d NPV 10% $MM 0.4 1.8 3.2 4.5 5.8 Raw Natural Gas EUR: 3.0 Bcf IRR (%) 12 19 27 37 47 Stabilized Condensate EUR: 317 MBbl Payout (Years) 5.2 3.6 2.7 2.2 1.8 Total Sales per Well: 894 MBoe CGR(raw): 178 Bbl/MMcf (IP 30 ) P/I @ 10% 1.0 1.2 1.4 1.5 1.7 FX (USD/CAD): $0.75 EUR denotes estimated ultimate recovery. 8
Valhalla • ~ 65 sections (~ 49 net) Montney rights • ~ 56 sections (~ 42 net) Doig rights • Three development horizons: • Upper Montney/Doig • Middle Montney • Lower Montney • 16 wells currently tied in • July Sales: ~ 740 Boe/d (net) (2) • Evaluating long term production/economics to determine future investment levels (1) Based on results from Paramount's wells and publicly disclosed results of competitor wells. (2) Estimated 9
Valhalla Economics: Montney Assumptions: Economics @ $2.50/GJ AECO Capital: $6.4 MM d/c/e/t US$/Bbl WTI $40 $45 $50 $55 $60 IP 30 (raw): 4.8 MMcf/d NPV 10% $MM 0.8 1.4 2.1 2.8 3.4 Raw Natural Gas EUR: 5.0 Bcf IRR (%) 14 18 23 27 32 Stabilized Condensate EUR: 150 MBbl Payout (Years) 4.6 3.8 3.3 2.9 2.5 Total Sales per Well: 961 MBoe P/I @ 10% 1.1 1.2 1.3 1.5 1.6 CGR(raw): 30 Bbl/MMcf (IP 30 ) FX (USD/CAD): $0.75 EUR denotes estimated ultimate recovery. 10
Willesden Green Duvernay Shale Play • 59,971 acres of land (100% WI) • Drilled and completed 3 Hz Duvernay wells to date: Cumulative production to June 30, 2016 Natural Gas Oil and NGLs MMcf MBbl 03/16-13-39-5W5 184.3 103 7-19-39-5W5 118.5 31 3-28-39-5W5 76.7 37 Total 379.5 171 • Currently re-entering 11-32 to drill the horizontal leg • 4-7 will be re-entered at a later date 11 11
Birch • Montney shale play (50% WI) • ~ 60 sections (~ 30 net) Montney rights • Seven Hz Montney wells drilled to date • NGL yields average 50 Bbl/MMcf • New 20 MMcf/d facility onstream December 2015 • July Sales: 1,300 Boe/d (net) (1) (1) Estimated 12
Birch Economics: Montney Assumptions: Economics @ $2.50/GJ AECO Capital: $7.2 MM d/c/e/t US$/Bbl WTI $40 $45 $50 $55 $60 IP 30 : 5.8 MMcf/d NPV 10% $MM 1.1 2.1 3.1 4.1 5.1 Raw Natural Gas EUR: 6.0 Bcf IRR (%) 17 25 33 42 52 Stabilized Condensate EUR: 200 MBbl Payout (Years) 3.7 2.9 2.4 2.0 1.8 Total Sales per Well: 1.2 MMBoe P/I @ 10% 1.2 1.3 1.4 1.6 1.7 CGR(raw): 70 Bbl/MMcf (IP 30 ) FX (USD/CAD): $0.75 EUR denotes estimated ultimate recovery. 13
Paramount Investments
15 Paramount Investments 15
Paramount 100% Subsidiary Investments (1) As publicly disclosed by a large U.S. public E&P company with significant landholdings in the Liard Basin. The resource evaluation disclosed by such E&P company was not noted as having been prepared independently or by a qualified reserves evaluator or auditor (as such terms are defined in NI 51-101) or in accordance with the COGE Handbook. This information is relevant to Paramount’s landholdings in the Liard Basin as the information is in respect of landholdings in the Liard Basin that are close to Paramount’s lands and are, accordingly, likely to have similar geology. (2) Based on publicly available information. 16 16
Quarterly Operating Results (1) Excluding Musreau/Kakwa Assets sold in August 2016 17 17
Reserves 1) Principal properties reserves, exclude bitumen reserves related to the Hoole oilsands development. Reserves evaluated by McDaniel &Associates Consultants Ltd. in accordance with National Instrument 51-101 definitions, standards and procedures. Columns may not add due to rounding. (2) December 31,2015 reserves volumes, excluding the Musrea/Kakwa assets sold in August 2016. These volumes were derived from the independent engineering evaluation prepared by McDaniel & Associates Consultants Ltd. attributable to Paramount's properties effective as of December 31, 2015 (the "McDaniel Report"). Estimated reserves volumes from the McDaniel Report have not been updated for subsequent changes occurring after December 31, 2015, including changes in forecast commodity prices, production, current year additions or other potential changes in variables. 18 18
Summary Exposure to significant reserve opportunities • Deep Basin: Montney, Cretaceous • Valhalla: Montney, Doig • Birch: Montney • Willesden Green: Duvernay Significant asset value • Trilogy • Seven Generations • MEG Energy • Cavalier Energy • Liard Shale Gas • Northern Frontier Resources • Investment Portfolio Paramount continues to provide long-term value creation for shareholders 19 19
ADVISORIES APPENDIX
Recommend
More recommend
