Cardinal Energy Ltd. · TSX:CJ
Cardinal Energy — Investor Presentation (November 2015)
26 slides from Cardinal Energy's investor presentation, November 2015
Slide 1: Built to Last
BUILT TO LAST NOVEMBER 2015
Slide 2: Built to Last
Built to Last Low Debt Low Decline Strong Capital Efficiencies 2
Slide 3: Cardinal Energy Profile
Cardinal Energy Profile Shares Outstanding(1): TSX: CJ nergy Ltd. Basic 64,961,946 Fully Diluted 67,476,387 Annual Dividend ($/share) $0.84 2015 forecast average production (boe/d): 11,200 Q3 2015 average production (boe/d) 11,220 2015 forecast exit production (boe/d) 14,500 2016 forecast average pr
Slide 4: ARO
ARO Millions $200 $180 $160 $140 $120 $100 $80 $11,000,000 $60 $40 $20 $0 0‐9 years 10‐20 years 21‐35 years 36‐50 years Facilities Wells NPV 10 = $42 MM 4
Slide 5: Cardinal Asset Base
Cardinal Asset Base Solid Base of Oil Production from 3 Core Areas WAINWRIGHT Appr. 5,400 boe/d production for Q3 2015 BANTRY Appr. 5,800 boe/d production for Q3 2015 SLAVE LAKE Appr. 3,300 boe/d production net to Cardinal at closing on October 30, 2015. All areas have extensive development drilling
Slide 6: Wainwright
Wainwright Dominant land position with over 55 sections of land Oil production under waterflood with less than 10% decline 98% operated, average 95% working interest Multiyear drilling inventory in excess of 40 unbooked locations 5,400 boe/d Control key infrastructure By pass uphole oil
Slide 7: Bantry
Bantry Dominant land position The majority of base production is currently under waterflood with less than a 12% decline 97% operated, average 94% working interest oil production Control key infrastructure resulting in ½ cycle drilling program 5,800 boe/d Solid Glauc drilling results to da
Slide 8: Bantry Drilling Efficiency
Bantry Drilling Efficiency Type Drilled Curve results SAL* to date* D&C ($MM) $1.7 $1.7 Production, IP30 (boepd) 240 350 Production IP365 (boepd) 140 210 estimate Total P&P Reserves (Mboe) * 150 200 Year 1 Oil & NGLs (%) 92% 92% NPV BT10(1) ($MM) 2.6 3.7 Rate of Return (%) 120% 295% Payout (Years) 1
Slide 9: Ellerslie Waterflood
Ellerslie Waterflood Zero capital invested to-date Water redirection only Estimate ~ 50 bopd uplift More upside with source well reactivation & proper WF geometry realignment Further opportunities exist within Bantry 9
Slide 10: Slave Lake
Slave Lake New Core Area 3,300 boe/d 78% liquid production, 41 API light crude oil Large OOIP Oil production under waterflood with less than a 10% decline 10
Slide 11: Mitsue Transaction Summary
Mitsue Transaction Summary Private Co. Operated Assets Split: 75% Cardinal, 25% Private Co. Net Purchase Price: $129,000,000 Working Interest production: 3,300 BOEPD Cash Flow multiple at $50 WTI: 5X ROFR on core private company assets Cardinal Operated Net Reserves: RLI BOE PDP mboe 12.8 m 10.
Slide 12: Mitsue Gilwood Units
Mitsue Gilwood Units Large OOIP, current estimates between 800 million and 1 billion barrels in place Opportunity to significantly expand the reserves and recovery factors Consolidation opportunities 4 initial concepts for growth Reactivations Overall volume increase Water flood optimi
Slide 13: Mitsue vs Nipisi
Mitsue vs Nipisi 37,300 Area (ha) 61,500 140 Producing Wells 160 2,800 bbl/day Production 3,070 bbl/day 15% Porosity 13.2% 35% Water Saturation 36% 41 Oil API Gravity 43 385,000,000 CUM Production (bbls) 400,000,000 2,310,000,000 Water Injected (bbls) 1,305,000,000 1. The above information is from t
Slide 14: Mitsue vs Nipisi Gilwood Units
Mitsue vs Nipisi Gilwood Units Nipisi Mitsue Nipisi Mitsue Nipisi Mitsue Production Production AUG AUG # of Wells # of Wells BOPD BOPD WCT WCT Less than 50% WCT 12 53 140 1,100 20% 10% 50% - 90% WCT 31 28 440 500 77% 81% 90% - 95% WCT 17 15 220 200 93% 93% 55% - 98% WCT 6 34 600 820 97% 97% Greater
Slide 15: 2015 Capital Efficiency
2015 Capital Efficiency 3,300 boed 4,825 boed 4,825 boed(1) 1,525 1,525boed boed(1) 1,085/boed(1) 1,525 boed(1) 1,525 boed(1) 1. Based on IP365 average not on actual production per year 15
Slide 16: Hedging
Hedging 7,000 $100.00 C$ WTI - Average Floor Price 6,000 $86.67 $90.00 5,000 BBL/D Hedged $78.60 $80.00 $74.70 $75.80 $75.09 $73.74 $78.60 4,000 $75.09 $73.74 $70.00 3,000 $60.00 2,000 $50.00 1,000 ‐ $40.00 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2015 2016 2016 2016 2016 2017 2017 2017 2017 1. 1,000 boe/d of WCS
Slide 17: 2015 Q3 Results
2015 Q3 Results Q3 2015 Q3 2014 % change OPERATIONAL Average production (boe/d) 11,220 7,587 48% Percentage of liquids 92% 90% 2% Development capital ($MM)(1) $11.7 $9.2 28% FINANCIAL Cash flow from operations ($MM) $24.8 $25.9 (4%) -per share (basic) $0.43 $0.60 (28%) Total dividend ($MM) $12.1 $8.
Slide 18: 2015 and 2016 Guidance
2015 and 2016 Guidance Operational 2016e 2015e 2014 Average Oil Price $ 50 WTI $ 55 WTI $93 WTI Average production (boe/d) 14,600 11,200 7,815 Development capital ($MM)(1) $ 35 $ 30 $ 36 Wells Drilled 12 8 7 Financial Cash flow from operations ($MM) $92(3) $95(2) $95 - per share (basic) $1.41 $1.67
Slide 19: Per Share Growth
Per Share Growth boe/d 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 Production Growth Since IPO 221 Q1 2014 Q2 201403 2014 24 20141 2015Q2 2015Q3 2015 2015 2016 Forecast Forecast mmm Total (boe/d) Production / MM shares basic 225 215 205 195 185 175 165 155 Production / MM shares - basic 14%
Slide 20: Operating Costs
Operating Costs oe ENERGY LTD. OPERATING COSTS ($/BOE) $34.00 @ Bantry Acquisition (2) Wainwright Acquisition #1 C3 ) Wainwright Acquisition #2 » = int a a $32.00 (4) Mitsue Acquisition $30.00 $28.00 $26.00 $24.00 o N a n 4 N a $22.00 | ° oe oS x yw $20.00 im 3Q15 1Q13 2Q13 3Q13 4013 1Q14 2014 3Q14
Slide 21: Sensitivities
Sensitivities Oil (USD WTI) $ 45.00 $ 50.00 $ 55.00 $ 60.00 $ 65.00 $ 70.00 $ 75.00 $ 80.00 WCS (CAD) $ 45.75 $ 49.67 $ 53.25 $ 56.50 $ 59.75 $ 62.75 $ 65.74 $ 68.50 FX (USD/CAD) 0.75 0.75 0.77 0.79 0.81 0.83 0.85 0.87 Aeco (CAD) $ 2.75 $ 2.75 $ 2.75 $ 2.75 $ 2.75 $ 2.75 $ 2.75 $ 2.75 Netback ($/boe
Slide 22: Corporate Information
Corporate Information Corporate Headquarters Cardinal Energy Ltd. 600, 400 – 3rd Avenue S.W. Calgary, AB T2P 4H2 Bankers ATB Financial CIBC World Markets Inc. RBC Dominion Securities Inc. Scotia Capital Inc. National Bank of Canada Auditors KPMG LLP Legal Burnet Duckworth & Palmer LLP Reserves Sprou
Slide 23: Analyst Coverage
Analyst Coverage Firm Analyst Phone Email BMO Nesbitt Burns 403-515-1500 CIBC Adam Gill 403-216-3405 adam.gill@cibc.com Clarus Securities Inc. Josie Ho 403-767-0823 jho@clarussecurities.com Dundee Securities Chad Ellison 403-509-2663 cellison@dundeesecurities.com FirstEnergy Capital Corp. Cody Kwong
Slide 24: Advisory
Advisory Forward-looking Statements This presentation contains forward-looking statements and forward-looking information (collectively "forward-looking information") within the meaning of applicable securities laws relating to the Cardinal's plans and other aspects of Cardinal's anticipated future
Slide 25: Advisory
Advisory This presentation contains future-oriented financial information and financial outlook information (collectively, "FOFI") about our prospective results of operations, cash flows, payout ratio and components thereof, all of which are subject to the same assumptions, risk factors, limitations
Slide 26: Advisory
Advisory Advisory Regarding Oil and Gas Information The crude oil, natural gas and natural gas liquid reserves and related future net revenue of Cardinal presented herein were evaluated by Sproule Associates Limited ("Sproule") and GLJ Petroleum Consultants (“GLJ“), Cardinal's independent reserves e
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