Corporate Presentation Driving growth, profitability and responsibility in the Trinidad oil and gas industry September 2020 1
Forward Looking Information Unle less oth therwise stated, all all fin finan ancial amou ounts ts herein in are presented in in Unit ited States doll ollars (“ $ ”) . The Compan any may al also reference Can anad adian an doll ollars (“C $ ”), Trin inid idad ad an and Tob obago doll llars (“TT $ ”) an and Pou ounds Sterlin ling (“ £ ”) he herein in. Certain information regarding Touchstone Exploration Inc. (“Touchstone” or the “Company”) set forth in this presentation, including assessments by the Company’s Management of the Company’s plans and future operations, contains forward-looking statements that involve substantial known and unknown risks and uncertainties. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and other similar expressions. Statements relating to “reserves” and “resources” are deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described exist in the quantities predicted or estimated and can be profitably produced in the future. The Company has a reasonable basis for disclosing such statements, which represent the Company’s internal projections, estimates or beliefs concerning future growth, and results of operations. With respect to forward-looking information contained in this presentation, the Company has made assumptions regarding: financial condition, outlook and results of operations, exploration, development and associated operational plans (including drilling, testing, facilities construction and recompletion programs) and the anticipated costs and timing thereof; estimated oil and gas reserves (including the magnitude, ability to recover, commerciality and net present value thereof); production rates and production decline rates; the success of exploration opportunities; plans for and results of production testing; the ability to secure necessary personnel, equipment, production licences and services; environmental matters; future commodity prices; changes to prevailing regulatory, royalty, tax and environmental laws and regulations; the impact of competition, future capital and other expenditures (including the amount, nature and sources of funding thereof); future financing sources; and business prospects and opportunities; and the impact the COVID-19 pandemic will have on the Company’s future operations and future petroleum pricing, among other things. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. New factors emerge from time to time, and it is not possible for Management to predict all of such factors and to assess in advance the impact of each such factor on Touchstone’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Although the Company believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. Some of the risks that could affect the Company's future results and could cause results to differ materially from those expressed in the forward-looking information are described under the heading “Advisories : Business Risks” in this presentation and are also set out in more detail in the Company's 2019 Annual Information Form dated March 25, 2020 which has been filed on SEDAR and can be accessed at www.sedar.com. Investors should not place undue reliance on any such forward-looking statements or information. Further, any forward-looking statement or information speaks only as of the date on which such statement is made, and Touchstone undertakes no obligation to update any forward-looking statements or information except as required by law, including securities laws. All forward-looking statements and information contained in this presentation are qualified by such cautionary statements. 2
Touchstone’s ➢ Pro roven an and experienced le lead adership ip Competitive Advantage ➢ Fo Focused str strategy on onsh shore Trin rinid idad oil oil an and gas as ➢ Pos ositiv ive op operatin ing cas cash flo flows ➢ Sig ignificant exploration op opportunitie ies 3
Our Five Pillar Corporate Vision Exploration Upside Scalable Economic Growth Value Creation Environmental Stewardship Community Leadership 4
Land Holdings Exploration Acreage Developed Acreage Oil Pool 35,785 net working interest acres 7,836 net working interest acres Coho – 1P reserves of 1,148 Mboe; 2P reserves of 3,348 Mboe (1) Proved (“1P”) reserves of 10,692 Mbbls (1) Gas Pool Cascadura – 1P reserves of 23,622 Mboe; 2P reserves of 45,030 Mboe (2) Proved plus probable (“2P”) reserves of 18,708 Mbbls (1) 5
Exploration Upside The hig ighly exciting exploration campaign at t th the Ort rtoire block re represents a sig ignificant opportunity for Touchstone and th the wid ider Tri rinidad oil il & gas in industry ry, , as seen by y th the success encountered at t th the fir first tw two dis iscoveries. 6
Exploration Upside – Ortoire Block Cascadura-1ST1 Chinook-1 Cascadura-Deep Royston Coho-1 Gas Discovery Gas Prospect Gas Prospect Gas Prospect Gas Discovery 28.1 MMcf/d 11.6 MMcf/d Constructing 783 bbls/d Constructing (1,925 boe/d) (3) Drilling Q1 2020 (5,472 boe/d) (4) Q3 2020 7
The Ortoire Block - 80% working interest and 35,785 net working interest acres Balata East Oil 10 MMbbls Pool Pipeline Gas Discovery Pool river Valve Station Pool CASCADURA Pipeline Well CAS-1ST1 Facility Pipeline tie-in CHINOOK-1 ROYSTON ROYSTON-1 CHINOOK COHO COHO-1 Baraka Central Block Gas Plant East c. 80 MMcf/d Capacity c. 40 MMcf/d Throughput Mora Drip Valve Station Baraka Navette Central Block 500 B cf natural gas, 25 MMboe NGLs 57 MMbbls Catshill Carapal Ridge 30 MMbbls OIL PIPELINE OIL GAS PIPELINE PIPELINE 8
Flowback testing exceeded expectations (3) COHO-1 46.0 MMcf/d AOF 11.6 MMcf/d average Estimated gross future production rate (3) 10 – 12 MMcf/d (1,333 – 1,600 boe/d net) Reserves (1) 1P - 1,148 Mboe 2P - 3,348 Mboe Natural Gas Fiscal Advantage Trinidad domestic price 12.5% crown royalty Not subject to SPT 9
Cascadura-1ST1 Upper Test Results (4) 390 MMcf/d AOF 5,472 boe/d average 86% natural gas Lower Test Results (4) 92 MMcf/d AOF 5,157 boe/d average 87% natural gas Reserves (2) 1P - 23,622 Mboe 2P - 45,030 Mboe 10
Chinook-1 and Cascadura-Deep Cascadura-Deep Chinook-1 ➢ Targeting to test two new ➢ The original well was drilled thrust sheets to understand in 1959 and encountered oil the true potential of the on core and oil while drilling. Herrera sands in the area. 11
Shell Trinidad Limited Royston-1 – Natural Gas Prospect Lizard Springs (OL-4) c. 1965 Original well was drilled in 1965. Logs indicated 700 feet of gas effect, but the well was never tested. Ortoire Synclinal P10 Case Basin P50 Case P90 Case ROYSTON-1 LOC 12
2020 Goals 2020 Corporate Goals ➢ Negotiate and formalize a natural gas marketing contract for the Ortoire block. ➢ Drill Chinook-1 and Cascadura-Deep prior to the end of 2020. ➢ Bring Coho-1 onto production to increase cash flows and decrease the Company’s sole reliance on volatile crude oil pricing. ➢ Formulate a design and plan for production from the Cascadura-1ST1 well. 13
Scalable Economic Growth Our developed properties have continued to be a key attribute to the Company’s success through the low base production decline rate and long- life production, that require minimal capital to maintain. 14
Developed Acreage and Production “A 20 - year drilling program providing Touchstone with a strong organic growth platform” 10 10 Produci cing fie ields YT YTD Q2 2 pr production of 1,49 1,493 208 Dr 208 Dril illi ling locations (9) bb bbls/d 15
Environmental Stewardship Value Creation “I am happy to report that the Company finished the second quarter with a healthy cash position with increased financial flexibility through a new term loan, monetizing our Trinidad government issued bonds for past due value added taxes, and reducing our operating and general and administrative costs.” Paul R. Baay – President and CEO 16
A Snapshot of Touchstone Capital Structure at August 31, 2020 First Half 2020 Results Petroleum Sales Operating Netback (5)(6) Term Credit Facility Market Capitalization (8) $10,453,000 $14.92/bbl $20,000,000 C$234,197,856 Average Crude Oil Production 1,493 bbls/d Capital Expenditures Funds Flow From Operations (5) Common Shares Outstanding $3,384,000 $807,000 184,407,761 Working Capital Surplus (5)(7) Cash $6,534,000 $6,891,000 17
Recommend
More recommend
