Saturn Oil & Gas Inc. · TSX:SOIL
Saturn Oil & Gas — Investor Presentation (February 2022)
31 slides from Saturn Oil & Gas's investor presentation, February 2022
Slide 1: Corporate Presentation
February 2022 TSX-V: SOIL FSE: SMKA CORPORATE PRESENTATION
Slide 2: Saturn History
SATURN HISTORY 2017 Saturn Oil + Gas Capitalized to Develop Viking Formation in Saskatchewan, 3 Wells Successfully Drilled 2018 Increased Reserves 476% with Successful Drilling of 18 Net Wells 2019 Increased Reserves 64% with Successful Drilling of 17 Net Wells TSXV: SOIL I FSE: SMKA 2 2
Slide 3: Saturn Growth Opportunity
SATURN GROWTH OPPORTUNITY 2,890% Production Growth in 20211 Saturn has transformed itself with the Oxbow Acquisition, closed June 2021. 400+ Non-Producing Wells To We have assembled a platform for Workover & Put Into Production years of growth, funded by internally generated cash flow from a low dec
Slide 4: 2021: Oxbow Transformational Acquisition
2021: OXBOW TRANSFORMATIONAL ACQUISITION $79.5M 6,400 boe/d 1.2x Saturn Land Net Cash Price Net Production Added at Cash Flow Closing Date $119M Transaction Financing $87M Term debt with New York based family office partner ▪ Ideal financial partner for future acquisitions $32M Equity financing, ove
Slide 5: Optimization Opportunity
OPTIMIZATION OPPORTUNITY Immediate Strategy of Enhancing Current Oxbow Production Base Results To Date 1,100 producing wells and 400+ non- 20 inactive wells returned to production producing wells to optimize ▪ Capital efficiencies of $1,700/bbl/d ▪ 3,500 bbls/d of workover potential identified1 ▪ Ta
Slide 6: Drilling Opportunity
DRILLING OPPORTUNITY Vast Inventory of Drilling Opportunities for Growth 370 booked drilling locations with certified reserves1 ▪ Oxbow Asset o 6 horizontal wells drilled in Dec ’22 – Jan ’22: results in mid-February o 242 booked locations o 20,000 bbls/d+ of potential production additions o 100+ ad
Slide 7: Q3 2021 Financial Highlights
Q3 2021 FINANCIAL HIGHLIGHTS $78.38 Average Realized Oil Price (WTI averaged US$70.56) Average Production - Boe/d Production $48.5M Revenue Q3 2021 6,970 Increase 2,890% $17.2M EBITDA Q2 2021 1,875 $13.9M Adjusted Funds Flow ($0.55 per Basic Share) Q1 2021 233 $9.5M Free Funds Flow (Annualized 43% F
Slide 8: Q3 2021 Peer Comparison
Q3 2021 PEER COMPARISON Q3 2021 Oil & NGL % of Production Q3 2021 Operating Netback ($/boe)1 2022E EV/DACF2 Average 3.8x Saturn has High Oil Weighted Production and High Field Netbacks 1) Based on Q3 2021 Operating Field Netbacks prior to Hedging Adjustment, General and Administrative and Interest E
Slide 9: Corporate Profile – TSX.V: SOIL FSE: SMKA
CORPORATE PROFILE – TSX.V: SOIL FSE: SMKA FINANCIAL Conservative Balance Sheet Management Shares Outstanding 25.1M ▪ Modest debt levels of ~1.3x annualized Adjusted Funds Flow1 Options (avg. exercise $2.50) 2.0M SOIL.WT Warrants (exercise = 20 warrants +$3.20) 268.3M ▪ 45% of Cash Flow directed to d
Slide 10: Net Asset Value
NET ASSET VALUE Saturn Shares are Backed with Solid Asset Value1 Long Life Assets Generate Strong Cash Flows ▪ 20-year P+P Reserve Life Index (RLI)2 ▪ Full exercise of warrants and options provides $61.5M in proceeds (average exercise price $3.12 / share) ▪ Total Proved FD NAV = $7.10 / share Natura
Slide 11: The Saskatchewan Advantage
THE SASKATCHEWAN ADVANTAGE Saturn: 95% oil, 100% Saskatchewan Among the Best Jurisdictions in the World For Investment ▪ Stable government and attractive fiscal terms ▪ Strong industry fundamentals for jobs, exports, economic growth and prosperity ▪ Government and provincial stakeholder groups extre
Slide 12: Environmental Protection
ENVIRONMENTAL PROTECTION Saturn: Partners with Farmers We are committed to returning production sites back to pristine conditions after a well’s Partners with Nature production life has expired: ✓ $21.0M deposit made for future site reclamation ✓ $13.3M Accelerated Site Closure Program (ASCP) fundin
Slide 13: Saturn Summary
SATURN SUMMARY 95% Oil Weighted Production Base Pursuing Multiple Opportunities For Growth Optimization High Quality Proven Meaningful of Existing Drilling Growth Shareholder Production Inventory Strategy Value Creation Low-cost production adds Positioned in two of the Recent transformational Foreca
Slide 14: Operations Summary
OPERATIONS SUMMARY TSXV: SOIL I FSE: SMKA 14 14
Slide 15: Oxbow Asset – Southeast Saskatchewan
OXBOW ASSET – SOUTHEAST SASKATCHEWAN Oxbow North Operating Area – Recent Drilling Activity Spearfish/Frob-Alida/Tiston Reservoir Parameters Manor Queensdale Fertile-Antler Whitecap - Tilston Whitecap - Frobisher 101/13-25-007-31W1 T9 Parameter Units Spearfish Frob-Alida Tiston 101/05-12-006-06W2 IP
Slide 16: Oxbow Asset – Southeast Saskatchewan
OXBOW ASSET – SOUTHEAST SASKATCHEWAN Oxbow South Operating Area – Recent Drilling Activity Midale/Frobisher Reservoir Parameters Whitecap - Frobisher 101/13-17-004-01W2 IP 90 Oil: 109 bbl/d Adonai- Frobisher T5 Parameter Units Midale Frobisher RR: February 2020 101/06-08-003-33W1/00 IP 90 Oil: 156 b
Slide 17: Viking Asset – West-Central Saskatchewan
VIKING ASSET – WEST-CENTRAL SASKATCHEWAN High Netbacks With Modest Capex Generate Significant Cash Flow Parameter Units Viking Vertical Depth meters 700-750 Net Pay meters 4.5 Avg. Porosity % 20 Permeability mD 0.1 – 1.0 Est. Water Sat. % 20 OOIP per Section mmbbl 6.5 Oil Quality API 37 Viking Satur
Slide 18: Saturn Three Year Plan
SATURN THREE YEAR PLAN Flexible Capital Budget - Highly Scalable to Rise in Oil Prices Capital Maintenance Drilling Growth Program Workover 400 suspended wellbores over the next three years Development Drilling ▪ $15-20M annual maintenance budget replaces decline and ▪ 370 total booked drilling loca
Slide 19: Management
MANAGEMENT The Right Team To Translate Vision Into Reality • Former CFO and founding partner of Axiom Group John Jeffrey • Strong background in operations and finance with successful track record executing large international engineering and environmental Chief Executive projects Officer • MBA major
Slide 20: Directors
DIRECTORS Strong Governance Combined With Operational Expertise • For 40 years, worked in the communications tower construction and ownership industry, in field construction, design engineering and management Calvin J. Payne • Former Co-founder and CEO of WesTower Communications, which was founded i
Slide 21: Saturn: The Complete Picture
SATURN: THE COMPLETE PICTURE Prioritizing the Generation of Responsible Growth and Sustainable Free Cash Flow, Supported by Prudent Fiscal Management and Long-term Drilling Inventory Continued Acquisition of Quality Assets Strategic Fiscal Management ▪ The acquisition and development of ▪ Prudent ba
Slide 22: Saturn's Mission Statement
Saturn’s Mission Statement “Saturn aims to lead the oil industry in both executional excellence and corporate stewardship. Our focus will remain to maximize shareholder value in the context of Saturn being at the forefront of what it means to be a Corporate Citizen.” John Jeffrey, CEO
Slide 23: Appendix
APPENDIX TSXV: SOIL I FSE: SMKA 23 23
Slide 24: Marketing & Risk Management
MARKETING & RISK MANAGEMENT Locked-in Economics Provides Security for Debt Repayment WTI Hedged as % of Oil & NGL Production Hedging Summary as of February 1, 2021 Average % of Liquids Volume Period Derivative Reference Price Period Volume (b/d) Production1 2,364 bbl/d 2022 Swap WTI US$58.85 2022 5,
Slide 25: Oxbow Acquisition Economics
OXBOW ACQUISITION ECONOMICS Production Funds Strong Free Cash Flow After Debt Repayment and ARO Expenditures1 ▪ Total Proved Forecast Cash Flow (undiscounted) of $564.3M funds: Total Proved Future Cash Flow Allocation (undiscounted) • Term loan repayment and interest = $100.2M • Abandonment Retireme
Slide 26: Environmental, Social & Governance Priorities
ENVIRONMENTAL, SOCIAL & GOVERNANCE PRIORITIES E S G ▪ Follow industry best practices to ▪ Strong relationships with our ▪ Introduced new employee minimize adverse effects to the community and stakeholders handbook in 2021 environment ▪ Assisting women to enter industry • Outlines the expected ▪ Comm
Slide 27: Disclaimer - Cautionary Statements
DISCLAIMER - CAUTIONARY STATEMENTS This presentation is for informational purposes only and is not intended as a solicitation or offering of securities of Saturn Oil & Gas Inc. (“Saturn” or the Company") in any jurisdiction. The material presented is not intended to modify, qualify, supplement or am
Slide 28: Disclaimer - Oil and Gas Advisories
DISCLAIMER - OIL AND GAS ADVISORIES Information Regarding Disclosure on Oil and Gas Operational Information and Non-IFRS Measures This presentation contains metrics commonly used in the oil and natural gas industry, such as “Netback”, “Operating Netback“, “Incremental Netback”, “Run Rate Debt Adjust
Slide 29: Disclaimer - Oil and Gas Advisories
DISCLAIMER - OIL AND GAS ADVISORIES Unaudited Financial Information Certain financial and operating information included in this presentation estimated for September 30, 2021, exploration and development expenditures, acquisitions / dispositions, finding and development costs, recycle ratio and netb
Slide 30: Disclaimer - Oil and Gas Advisories
DISCLAIMER - OIL AND GAS ADVISORIES Reserve Assumptions – Reserve evaluation calculations are based on data and Supplemental Information Regarding Corporate Reserves 1 expected future production volumes as provided by third party independent Natural evaluators:, a reserve evaluation prepared by an i
Slide 31: Contact Us
CONTACT US Kevin Smith Corporate Headquarters VP Corporate Development Suite 1000 - 207 9 Ave SW +1 (587) 392-7900 Calgary, Alberta, T2P 1K3 info@saturnoil.com Canada Website www.saturnoil.com TSXV: SOIL I FSE: SMKA 31 31
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