Headwater Exploration Inc. · TSX:HWX
Headwater Exploration — Investor Presentation (March 2025)
26 slides from Headwater Exploration's investor presentation, March 2025
Slide 1: Corporate Presentation
Headwater Exploration Inc. CORPORATE PRESENTATION TSX:HWX March 2025
Slide 2: Capitalization, Guidance and Business Strategy
CAPITALIZATION, GUIDANCE AND BUSINESS STRATEGY Outlook Capitalization Average Daily Production 2025 Guidance(1) Headwater Exploration Inc. TSX HWX (2) Annual Daily Production (boe/d) 22,250 Share Price (March 13th, 2025) $/sh. $5.97 Financial Summary ($millions) Shares Outstanding (Basic) MM 237.8 A
Slide 3: Expanding Clearwater Resource Provides Flexibility in Future Capital Allocation
HEADWATER EXPLORATION Expanding Clearwater Resource Provides Flexibility in Future Capital Allocation (1) Significant Clearwater Region 2025 Free Cashflow Yield 25% 7,000 Resource Expansion 22,250 Boe/day 2,000 $US 60 $US 70 $US 80 Est. 6,000 20,310 Boe/day 20% Annual avg Free Cashflow Yield (%) 18,
Slide 4: Leading Maintenance Capital Requirements Provides Capital Optionality
HEADWATER EXPLORATION Leading Maintenance Capital Requirements Provides Capital Optionality Maintenance Capital % of FFO Free Cashflow Per Share 50% $70 US/bbl $70 US/bbl 1.20 Total Capital Maintenance Capital 1.00 Free Cashflow Per Share ($) 40% Maintenance Capital (%) 0.80 30% 0.60 20% 0.40 10% 0.
Slide 5: Year End 2024 Reserves Summary
YEAR END 2024 RESERVES SUMMARY Reserves Year Over Year F&D including Heavy Oil Gas Total Replacement Recycle Reserve Category Change FDC (1) Rate Ratio (2) Mbbl MMcf Mboe (%) (%) $/boe Proved Producing 25,119 24,383 29,183 32% 196% 15.32 3.0 Total Proved 37,949 30,755 43,075 33% 242% 15.93 2.9 Total
Slide 6: Regional Clearwater Area
REGIONAL CLEARWATER AREA Total Land Holdings over 600 net sections Greater Peavine (Seal, Peavine) • Multi-zone potential from Falher Cadotte and Bluesky horizons Evi PEACE RIVER OIL SANDS REGION Cadotte Greater Pelican • Captured 57.5 sections Nampa • New Clearwater and Wabiskaw exploration lands c
Slide 7: Marten Hills Core Secondary Recovery
MARTEN HILLS CORE SECONDARY RECOVERY Strong results continue with 90% of core area sections supported Multi-Layer Support Two Bench Pattern Yellow: Marten Hills Core Marten Hills Core Producer 14,000 1,400 Blue: Three Bench Pattern 10-12m Oil (bbl/d) Green: Two Bench Pattern Entire Marten Hills Core
Slide 8: Marten Hills West Sandstone Secondary Recovery
MARTEN HILLS WEST SANDSTONE SECONDARY RECOVERY Response continues to improve with two full sections under secondary recovery Marten Hills West – Utilizing Marten Hills Core Learnings Bottom-Up Support Section 07-076-02W5 Pattern 1,200 2,400 Section 7 Oil (bbl/d) Secondary Recovery Expansion Producer
Slide 9: Marten Hills West – Clearwater Sandstone
MARTEN HILLS WEST – CLEARWATER SANDSTONE Continued Step-out Success; Expanding Secondary Recovery Clearwater Sandstone • Two full sections under secondary recovery MHW Secondary Recovery Section 07-076-02W5 2024 Full section implementation • 2 – 3 additional sections under secondary recovery in 2025
Slide 10: Marten Hills West Exploration
MARTEN HILLS WEST EXPLORATION Clearwater E Pool Expansion - A new growth opportunity within Marten Hills West Clearwater E 00/04-35-076-02W5 • The regional extent of the Clearwater E is estimated to be Winter access drill up to 52 sections in size IP60: 135 bbl/day All weather road being • Un-risked
Slide 11: Greater Pelican
GREATER PELICAN New Exploration Area Targeting Multiple Horizons Pelican Greater Pelican Bigstone Cree Nation Farm-in Block: • 34.5 sections captured Bigstone Cree Nation • Initial Wabiskaw location planned for Q1 2025 Marten Hills Farm-in Block Additional lands purchased at crown land sales: Slave
Slide 12: SW Saskatchewan
SW SASKATCHEWAN W3/W4 Mannville – SAGD and Conventional Heavy Oil Exploration Handel Large contiguous land block accumulated: • 57.75 Sections Reford 3D Seismic Acquisition: • 39 sections of 3D seismic acquired – covering 29.6 sections of HWX lands Cardinal – Reford Waseca SAGD Project • Multiple Ma
Slide 13: Greater Nipisi / Peavine – Over 200 Sections
GREATER NIPISI / PEAVINE – OVER 200 SECTIONS Multiple Productive Zones in the Falher, Clearwater, and Bluesky Little Horse South - Bluesky 00/02-10-083-16W5 Bluesky Four well Bluesky & Falher development program planned for • Bluesky exploration test at 00/16-29-076-14W5 02/02-10-083-16W5 Falher B L
Slide 14: Why Headwater
WHY HEADWATER Add Incremental Prospects Through Strategic Land Acquisitions and M&A •Total Clearwater lands now totaling over 600 net sections •Total Non-Clearwater lands now exceeding 190 net sections Explore and Exploit •11,000 bbl/d production from the MHW CLWT SS with regional extent exceeding 5
Slide 15: Appendix
Headwater Exploration Inc. Appendix TSX:HWX
Slide 16: Clearwater Secondary Recovery – Expanding Duration and Resource Capture
HEADWATER EXPLORATION Clearwater Secondary Recovery – Expanding Duration and Resource Capture • Approximately 50% of Headwater’s Current corporate oil production will be OOIP with Sections 2024 P+P Year Sections Production supported under secondary recovery by Secondary Currently End Secondary Marte
Slide 17: McCully Producing Asset
MCCULLY PRODUCING ASSET Dry Gas with 100% owned infrastructure and limited liability McCully Asset Daily Production 25.0 20.0 New Brunswick MNP pipeline Production mmscf/d 15.0 10.0 Nova Scotia 5.0 0.0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 HWX Realized
Slide 18: Experienced Team – Management and Directors
EXPERIENCED TEAM – MANAGEMENT AND DIRECTORS Headwater Exploration Inc. Management Team Neil Roszell, P. Eng. ▪ Former President, CEO and/or Executive Chairman and founder of Raging River Exploration Inc., Wild Stream Exploration Inc. and Wild River Resources Ltd. Executive Chairman Jason Jaskela, P.
Slide 19: Slide Notes
SLIDE NOTES Slide 1 1. Assumptions used in the 2025 guidance released on December 5, 2024 include: annual average production of 22,250 boe/d, WTI of US$70.00/bbl, WCS of Cdn$79.40/bbl, AGT US$9.00/mmbtu, AECO of $2.20 CAD/GJ, foreign exchange rate of US$/Cdn$ of 0.72, blending expense of WCS less $1
Slide 20: Forward Looking Statements Advisory
ADVISORIES Forward Looking Statements Advisory This investor presentation of Headwater Exploration Inc. ("Headwater") contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of Canadian securities laws. All statements other
Slide 21: Development Strategy Advisory
ADVISORIES Development Strategy Advisory Advisory Relating to Development Strategy (Slide 2) The Company has presented herein a three-year development strategy which is based on a number of assumptions as presented in such slides including, without limitation: the required reinvestment rates require
Slide 22: Non-GAAP Advisory
ADVISORIES Non-GAAP Advisory NON-GAAP MEASURES AND RATIOS Non-GAAP Financial Measures This investor presentation contains the terms “adjusted funds flow from operations (“AFFO”) or Atax funds flow”, Capital expenditures or capital program “adjusted working capital”, “capital expenditures or capital
Slide 23: Non-GAAP Advisory
ADVISORIES Non-GAAP Advisory Non-GAAP Ratios Maintenance Capital Reinvestment Rate Management believes the reinvestment rate is a useful measure to analyze the ratio of funds generated by the Company and used for reinvestment and is calculated as total maintenance capital divided by AFFO. Total Capi
Slide 24: Certain Oil and Gas Advisories
ADVISORIES Certain Oil and Gas Advisories TYPE CURVE INFORMATION, WELL ECONOMICS AND WATERFLOOD PERFORMANCE Headwater has presented certain type curve information, well economics and waterflood performance for certain development, exploration and waterflood activities in Headwater's areas of operati
Slide 25: Certain Oil and Gas Advisories
ADVISORIES Certain Oil and Gas Advisories BARRELS OF OIL EQUIVALENT The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy
Slide 26: Certain Oil and Gas Advisories
ADVISORIES Certain Oil and Gas Advisories MARKET, INDEPENDENT THIRD PARTY AND INDUSTRY DATA ADVISORY Certain market, independent third party and industry data contained in this presentation is based upon information from government or other independent industry publications and reports or based on e
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