24 slides from Paramount Resources Ltd. Class A's investor presentation, July 2016
Slide 1: Corporate Presentation July 2016
Corporate Presentation July 2016
Slide 2: Future Oriented Information
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 for
Slide 3: Corporate Profile
Corporate Profile Corporate Profile Strategic Investments/Emerging Plays • Founded in 1976; IPO in 1978; TSX: POU • Emerging Montney plays at Valhalla and Birch • Q1 2016 production: 50,161 Boe/d (~49% Liquids) • Emerging Duvernay play at Willesden Green • Market Cap: 106.2 MM shares @ $9.15/share ~
Slide 4: Deep Basin Resource
Deep Basin Resource Land Position Paramount Acreage (gross): • 486 Sections Cretaceous Rights • 362 Sections Montney Rights • 170 Sections Duvernay Rights Cretaceous Deep Basin liquids-rich gas resources in multiple stacked horizons • 40-160 Bcf/section DGIIP (1) • ~5+ Bcf EUR/Hz well (1) • >10 Tcf
Slide 5: Montney Gas Resource
Montney Gas Resource • Liquids-rich Montney gas play; Paramount holds ~313 net sections of Montney rights • Competitive well economics • High liquids content • Thick pay • High pore pressure (over pressured Deep Basin) PARAMOUNT MONTNEY WELLS – KAYBOB AND GRANDE PRAIRIE (1) Natural Wellhead CGR Tota
Slide 6: Montney "Rich" Well Economics
Montney "Rich" Well Economics Economics(4) @ $2.50 AECO Assumptions(1): US$/Bbl WTI $30 $40 $50 $60 Capital: $7.5 MM horizontal 1.5-mile lateral well (2) IP30: 5.4 MMcf/d (restricted) NPV 10% $MM -0.4 2.6 5.6 8.5 Natural Gas (raw): 5.0 Bcf IRR 8% 30% 55% 84% CGR(raw)(3): 171 Bbl/MMcf (IP30) Payout (
Slide 7: Montney "Ultra Rich" Well Economics
Montney "Ultra Rich" Well Economics Economics(4) @ $2.50 AECO Assumptions (1): US$/Bbl WTI $30 $40 $50 $60 Capital: $6.7 MM horizontal 1-mile lateral well (2) IP30: 2.2 MMcf/d (restricted) NPV 10% $MM -0.8 1.9 4.7 7.4 Natural Gas (raw): 2.0 Bcf IRR 4% 29% 59% 92% CGR(raw)(3): 452 Bbl/MMcf (IP30) Pay
Slide 8: Montney Drilling/Completion Cost Reductions
Montney Drilling/Completion Cost Reductions • Lower drilling costs due to: • reduced drilling days by improving penetration rates and efficiencies • lower day rates for rigs and lower equipment rental costs • Lower completion costs due to: • the switch to 125 T/stage foamed water frac from 60 T/stag
Slide 9: Montney 16-7 Pad Cumulative Raw Gas
Montney 16-7 Pad Cumulative Raw Gas 9
Slide 10: Sale of Musreau 8-13 Complex
Sale of Musreau 8-13 Complex • Closed sale of Musreau 8-13 processing facilites (Musreau Complex) and related midstream assets to Pembina • $565 MM cash (including adjustments) • $35 MM carried plant expenditures • Paramount retains priority access to full facility capacity(1) • Entered into a 20-ye
Slide 11: Deep Basin Gas Processing Capacity
Deep Basin Gas Processing Capacity Owned and Contracted Raw Gas Potential Processing Sales Capacity Volumes MMcf/d (1) Boe/d(1) Musreau Complex 250 70,000 Smoky Deep Cut Facility 50 12,000 Other Kaybob area 18 3,300 capacity Karr area capacity 40 9,700 Total 358 95,000 Future Capacity • Musreau 6-18
Slide 12: Illustrative Deep-Cut - Montney Wells
Illustrative Deep-Cut - Montney Wells 200 MMcf/d Raw Gas less 23% Shrinkage = 154 MMcf/d Sales Gas (25,667 Boe/d) + 22,000 Bbl/d condensate + 18,000 Bbl/d NGLs Price(1) Yield (Bbl/MMcf) Deep-Cut Sales Gas $2.65/Mcf 154 MMcf/d $408,100 Condensate $49.00/Bbl 110 22,000 Bbl/d $1,078,000 Butane $29.00/B
Slide 13: Willesden Green
Willesden Green Duvernay Shale Play • 61,252 acres of land (100% WI) • Drilled and completed 3 Hz Duvernay wells to date: Cumulative production to March 31, 2016 Natural Gas Oil and NGLs MMcf MBbl 03/16-13-39-5W5 171.2 96 7-19-39-5W5 118.5 31 3-28-39-5W5 55.8 29 Total 345.5 156 • Two standing wells
Slide 14: Montney
Montney Valhalla: ~65 sections (~49 net) Montney/~56 sections (~42 net) Doig rights • Montney/Doig Play • 16 wells currently tied in • Evaluating long term production/economics to determine future investment levels Birch: ~60 sections (~30 net) Montney rights • Montney shale play (50% WI) • Seven Hz
Slide 15: Paramount Investments
resources Itd, °- v) —_ c f<b) & —~ Vv”) oO My = — i= =) (2) € © _ © oO Pararmmournt
Slide 16: Paramount Investments
ji. Paramount Paramount Investments 19.1 MM shares resources Itd. _am__._itrilogy Energy (TSX:TET) TRILOGY Spun-out from Paramount in 2005 Market Cap: ~$687 Million 2015 production: 27,775 Boe/d Concentrated asset base, liquids-rich resource with multi-zone potential Key growth plays: Kaybob South M
Slide 17: Paramount 100% Subsidiary Investments
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 audit
Slide 18: Quarterly Operating Results
Quarterly Operating Results 18 18
Slide 19: Reserves
Reserves(1) 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 as at December 31, 2015. Columns may not a
Slide 20: Summary
Summary Exposure to significant reserve opportunities • Deep Basin: Montney, Cretaceous • Valhalla: Montney, Doig • Birch: Montney • Willesden Green: Duvernay Significant asset value • Trilogy • MEG Energy • Cavalier Energy • Liard Shale Gas • Northern Frontier Resources • Investment Portfolio Param
Slide 21: Advisories Appendix
resources Itd, °- ~2 a 2 uu QO. oO < ” =" & O L > a < Paramount
Slide 22: Advisories
Advisories Forward-Looking Information Certain statements in this presentation constitute forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as "anticipate", "believe", "estimate", "will", "expect", "plan", "
Slide 23: Advisories (con't)
Advisories (con't) Oil and Gas Measures and Definitions This presentation contains disclosure expressed as "Boe", "MBoe", "MMBoe" and "Boe/d". All natural gas equivalency volumes have been derived using the ratio of six thousand cubic feet of natural gas to one barrel of oil. Equivalency measures ma
Slide 24: te begs oh ae Se
te begs oh ae Se . ee Sl Paramount Resources Ltd. 4700 Bankers Hall West 888 Third Street S.W. Calgary, Alberta Canada, T2P 5C5 Telephone: 403.290.3600 Facsimile: 403.262.7994 WwWW.paramountres.com Parazarmrourrt * resources ltd: