Step Changes in Production Building Shareholder Value in the - - PowerPoint PPT Presentation

November 2016

Step Changes in Production

Building Shareholder Value in the Mannville Trend

PLX:TSXV 1

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Forward Looking Statement

Certain information regarding Point Loma Resources Ltd. (“the Corporation” or “PLX”) in this presentation including without limitation management's assessment of future plans and operations, the benefits to be derived from the proposed transactions, future acquisitions, timing of drilling and tie-in of wells, cash flow projections, pricing assumptions, productive capacity of the new wells and productive capacity from different wells, expected production rates, drilling success rates, expected operating rates, expected LLR ratings, dates of commencement of production, may constitute forward looking statements under applicable securities laws and necessarily involve risks including, without limitation, risks associated with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services, unexpected decline rates in wells, wells not performing as expected, delays resulting from or inability to obtain required regulatory approvals and ability to access sufficient capital from internal and external sources. As a consequence, actual results may differ materially from those anticipated in the forward-looking statements. Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could effect the Corporation's

• perations and financial results will be included in financial reports. Furthermore, the forward looking

statements contained in this presentation are made as at the date of this presentation and the Corporation does not undertake any obligation to update publicly or to revise any of the included forward looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

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Forward Looking Statement

Barrel of oil equivalents or BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different than the energy equivalency of the 6:1 conversion ratio, utilizing the 6:1 conversion ratio may be misleading as an indication of value. References in this document to production test rates, initial test production rates, and other short-term production rates are useful in confirming the presence of hydrocarbons, however such rates are not determinative of the rates at which such wells will commence production and decline thereafter and are not indicative of long term performance or of ultimate recovery. Additionally, such rates may also include recovered "load oil" fluids used in well completion stimulation. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for Point Loma. A pressure transient analysis or well-test interpretation has not been carried out in respect of all wells. Accordingly, the Corporation cautions that the test results should be considered to be preliminary.

PLX:TSXV

Snapshot

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Point Loma

• Production has increased from 135 – 500 boe/d since July
• Additional tie-ins of tested production will boost production

beyond 800 boepd this winter

• Large acreage position captured on core multi-zone light oil &

gas fairway

• Mannville horizontal wells….. “Strip pricing” IRR’s of 50-70% and

less than two year payouts on drill ready horizontal inventory

• No bank debt
• Experienced and skilled team that is focused on creating

shareholder value

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Strategy

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Point Loma

• Point Loma has captured a significant

position on the highly prospective multi-zone Mannville and Mississippian fairway of West Central Alberta.

• Modest drill depth and technological

advancements leads to strong economics with low costs per well

• With over 125,000 net acres with

significant shallow to medium depth horizontal drilling inventory (> 300 potential locations)

• Potential to drill and acquire to grow

50 -100% year over year

• Market has lessened competition for

deals and land

• Build value for successful exit strategy

and shareholder return PLX:TSXV

With a Track Record of Unlocking Value in West-Central Alberta

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An Experienced & Energized Team

Terry Meek, P.Eng., President, CEO

• Mr. Meek has 31 years of experience in the conventional and unconventional oil & gas industry. Former founder,

Executive VP and COO of the coal bed methane focused company Ember Resources Inc. (2005-2011). Former founder, VP Engineering and COO of Thunder Energy (1995-2005), growing market capital to over $600 million from inception.

Kevin Angus, P.Geoph., ICD.D, Executive Vice President Business Development

• Mr. Angus has 33 years of geotechnical experience and is also a director of Painted Pony Petroleum. Former co-founder
• f three public oil and gas companies, Mustang Resources Inc., Pegasus Oil and Gas Inc. and Surge Energy Inc. Mr.

Angus has also held positions with Husky Energy Inc., Ulster Petroleum Ltd. and Archean Energy Ltd.

Randall Boyd, CPA, CGA, Vice President Finance and CFO

• Mr. Boyd is an experienced public CFO with 35 years in the oil and gas industry. His experience includes positions as

CFO at Deventa Energy Inc., Masters Energy Inc. and other listed companies. Prior experience includes Flagstone Energy Inc., Norwich Resources and Archean Energy.

Dan Boyko, P. Eng., Vice President, Engineering

• Mr. Boyko has 33 years of experience in the petroleum industry. Former VP Business Development for Open Range

Energy Corp. and has acted as a Petroleum Engineering consultant for companies including NAL Resources, Devon Energy Canada and Lone Pine Resources. Mr. Boyko also served as a Team Lead and Senior Engineer at Poco Petroleums Ltd.

Brad Johnston , B.Comm – Vice President Land

• Mr. Johnston has 16 years of experience in the oil and gas industry, both internationally and in Western Canada, with a

focus on negotiating transactions for joint ventures, acquisitions and divestitures. Mr. Johnston previously held positions at Galleon Energy Inc., Nexen Energy Inc. and was VP Land for Carnaby Energy Ltd.

Gordon Cameron – Corporate Secretary

• Mr. Cameron is a partner at McCarthy Tétrault LLP. He has been a practicing corporate lawyer for over 8 years and

specializes in the areas of corporate finance, capital markets, corporate governance and mergers and acquisitions.

Experienced Board of Directors, Four Independent

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Strong Governance

Steve Dabner, P. Geol., - Chairman

• Mr. Dabner is currently Vice President Exploration and New Ventures at Madalena. Mr. Dabner has 32 years of industry

experience, including founding roles as President and Chief Executive Officer of Online Energy Inc., Trimox Energy Inc. and Moxie Exploration Ltd.

Doug Dafoe, CA

• Mr. Dafoe is currently the Chief Executive Officer and President of Ember Resources Inc. and Chairman of the Board of

Xtreme Drilling and Coil Services Corp. Mr. Dafoe has 35 years industry experience with public and private oil and gas companies in Western Canada, including acting as Chief Executive Officer and President to Sword Energy Inc.

Jay Reid, B.Comm, LLB

• Mr. Reid is currently a partner at Burnet Duckworth and Palmer LLP and has a practice focused on securities laws in the

area of capital markets, mergers and acquisitions and corporate governance. Mr. Reid has over 26 years of industry

• experience. During the course of his career Mr. Reid has acted as a Director or Officer of 19 public companies.

Don Brown

• Mr. Brown is an independent businessman with over 30 years of industry experience and formerly the President and

Chief Executive Officer of Elkwater Resources Ltd. until July 2014.

Terry Meek – President, CEO

• Bio in Management Section

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Capital Structure

Basic Shares Outstanding 27,268,682 Fully Diluted Shares Outstanding 29,038,368 Insider Ownership (Basic / Fully Diluted) 35% / 39% Management Ownership (Basic / Fully Diluted) 10.6% / 13.3% Market Capitalization (Basic)(1) $9,544,000 Working Capital (Oct. 31, 2016) $1,000,000 Convertible Debenture – Matures on June 28, 2021(2) $3,000,000 Convertible Debenture – Matures on June 28, 2018(3) $650,000 Enterprise Value (Basic) $11,694,000 Management Average Cost – per share $0.55-0.59

Notes: (1) Based on November 14, 2016 closing price of $0.35 per share (2) The convertible debenture was issued pursuant to the Madalena asset acquisition, bearing 3.0% interest with conversion price of $0.50 per share (3) The convertible debenture was issued upon closing the reverse takeover of First Mountain Exploration, bearing 7.0% interest with conversion price of $0.40 per share

TSXV – PLX Share Price (Nov. 14, 2016) $0.35

Clean Balance sheet

Current Production – boe/d 500 2016 Exit rate – boe/d (est.) 800 Oil/Gas weighting 40%/60%

Executing plan to unlock value

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Quick Start

Nov 2016

• Optimize wells
• Tie-in Hz Nordegg well
• Pipeline licensed
• Increases base

production to >700 boe/d Winter 2016/17

• License Thorsby tie-in
• Tie-in Thorsby Glauconite

well increases base production to >800 boe/d 2017

• Drill new Mannville Hz

wells

• New pool and

development

5 10 15 20 25 200 400 600 800 1000 1200 boe/d

• p cost

2017 Historical Projected 2016 $/boe Production boe/d

PLX:TSXV

Valuation lags our production and cash flow growth

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Point Loma Valuation – Attractive Entry Point

EV / DACF EV / Production

Notes: (1) Point Loma production is based on 800 Boe/d 2016 exit rate, DACF is based on S&P Capital IQ and management estimated netback (2) Peer group values are based on consensus estimates as of November 14, 2016

• 2017 estimates include additional tie-

ins and drilling of 2 Hz wells (subject to budget approval and funding)

• Trading at significant discount to

peer group

Peer Average Peer Average

• Potential for multiple expansion as

growth continues

Upper Mannville

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Multiple Zone Oil and Liquids Rich Gas Fairway

Blackspur Bonavista Tourmaline Cenovus Cardinal Vermillion Petrus Manitok

Industry Success Significant Horizontal Opportunity Base Zone Bypass Opportunities Follow up Locations Glauconite 17 104 Other Upper Mannville 15 90

• Over 5,500 well penetrations in

the area have identified our lead locations Assumptions Drill - $900k Complete - $500k Tie-in - $350k 15 stage frac IP 30 Oil 140 bpd IP 30 Gas 700mcfd IP 30 Boe 260 boe/d EUR 280 Mboe Economics @ Nov 2016 strip WTI $45US/bbl, Nymex gas $2.80US/mcf Payout 1.5 years IRR 63% NPV @ 10% $2.0M

Sensitivities in appendix

Lower Mannville

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Multiple Zone Oil and Liquids Rich Gas Fairway

Industry Success Zone Bypass Opportunities Follow up Locations Ostracod 19 121 Ellerslie 5 30

• Over 5,500 well penetrations in

the area have identified our lead locations

Blackspur Bonavista Tourmaline Cenovus Cardinal Vermillion Petrus Manitok

Assumptions Drill - $900k Complete - $500k Tie-in - $350k 15 stage frac IP 30 Oil 110 bpd IP 30 Gas 700mcfd IP 30 Boe 230 boe/d EUR 260 Mboe Economics @ Nov 2016 strip WTI $45US/bbl, Nymex gas $2.80US/mcf Payout 1.8 years IRR 52% NPV @ 10% $1.8M

Sensitivities in appendix

Significant Horizontal Opportunity Base

Existing production with development drilling

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Lower Mannville Oil Pool

12-5 8-5 1-5 12-31 1-32 8-31 5-31 4-31

LOWER MANNVILLE SS NET PAY MAP

Cutoff: 6% SSØ C.I. = 1.0m

• Currently optimizing

well production

• 400 Boe/d
• Cum oil 500 mstb
• Cum gas 2.7 Bcf
• 7 Drill-ready (5.4

net) Locations

• Waterflood potential
• Future cost

reductions with central facilities

Jurrasic

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Multiple Zone Oil and Liquids Rich Gas Fairway

Sinopec Surge New Star Long Run

Industry Success Zone Bypass Opportunities Follow up Locations Rock Creek 3 18 Nordegg 8 58

• Over 5,500 well penetrations in

the area have identified our lead locations

Significant Horizontal Opportunity Base

Assumptions Drill - $900k Complete - $500k Tie-in - $350k 15 stage frac IP 30 Oil 130 bpd IP 30 Gas 850 mcfd IP 30 Boe 290 boe/d EUR 250 Mboe Economics @ Nov 2016 strip WTI $45US/bbl, Nymex gas $2.80US/mcf Payout 1.8 years IRR 52% NPV @ 10% $1.7M

Sensitivities in appendix

Horizontal Development

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West Cove Nordegg Oil Pool

NORDEGG LS NET PAY MAP

Cutoff: 6% LSØ C.I. = 5m

Flow Test:

• Nov. 2016

Average Rate Over Final 6 Days: 230 Boe/d (65% Oil) Seismic Control 5-31 4-31

Large New Nordegg Discovery

• Discovery well 5-31 projected
• n stream in December 2016
• 10 (9.6 Net)

Nordegg Horizontal Development locations

• 110 MMbbls OOIP

Development location

Significant Upside Potential

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Leaman B Nordegg Gas and Liquids Pool

• Not included in current

forecasts

• 120 boe/d behind pipe

production

• Produced to date > 40Bcf
• Over 30 Bcf remaining in

undrained compartments

Remaining Reserves per compartment

PLX:TSXV

Identified Growth Steps, No Bank Debt, Strong Team

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Why Invest in Point Loma?

• Trading at low multiples of cash flow and production
• Identified growth, 500 boe/d targeting increases to 800

boe/d in next steps

• Large drilling inventory, development and new pools
• Additional add-on acquisitions available in the region
• Experienced team aligned with shareholders
• A clean starting point, with no bank debt

PLX:TSXV

Contact Information

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Head Office

500, 633 – Sixth Avenue SW Calgary, Alberta T2P 2Y5 403-705-5051

Contacts

Terry Meek, President, CEO 403-705-5051, e101 tmeek@pointloma.ca Kevin Angus, Executive Vice President Business Development 403-705-5051, e103 kangus@pointloma.ca Randall Boyd, Vice President Finance, Chief Financial Officer 403-705-5051, e105 rboyd@pointloma.ca

Corporate Services

Legal Counsel McCarthy Tétrault Reserve Engineers McDaniel & Associates Consultants Ltd. Auditors KPMG LLP Transfer Agent Computershare Investor Services

Costs have reduced significantly resulting in compelling economics

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Solid Type Curves, Economic Success

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Type curve sensitivities

IRR %

IRR %

40 50 60 70 2.50 37% 54% 75% 99% 3.00 45% 64% 86% 111% 3.50 55% 75% 98% 124% 4.00 64% 85% 110% 137% Oil - $US/bbl WTI Gas - Scdn/mcf AECO 40 50 60 70 2.50 44% 68% 97% 131% 3.00 54% 79% 110% 146% 3.50 64% 91% 123% 161% 4.00 75% 103% 137% 177% Gas - Scdn/mcf AECO

IRR %

40 50 60 70 2.50 45% 65% 89% 118% 3.00 45% 65% 89% 118% 3.50 53% 75% 101% 131% 4.00 62% 86% 113% 145% Oil - $US/bbl WTI Gas - Scdn/mcf AECO