Parex Resources Inc. · TSX:PXT
Parex Resources — Investor Presentation (October 2022)
21 slides from Parex Resources's investor presentation, October 2022
Slide 1: Investor Presentation: Unlocking Colombia
Investor Presentation Unlocking Colombia October 2022 1
Slide 2: Overview
Overview Largest independent oil & gas company in Colombia By land position and net production Production and reserves growth Growing on an absolute and per share basis Venezuela Top quartile netbacks Unhedged producer with exposure to Brent oil price Debt free and strong return of capital track rec
Slide 3: PXT Approach – Focused on Colombia
PXT Approach – Focused on Colombia Operational Consistent Return Top-Tier Strategy of Capital ESG Performance Unlock extensive land Track record of a focus on total Targeting GHG intensity reduction base using proven shareholder returns of 50% by 2030 and have 2050 technology net zero ambition(1) Di
Slide 4: Vision – Production of ~100,000 BOE/D
Vision – Production of ~100,000 BOE/D (boe/d)(1) 100,000 Ambition High-risk, high-reward exploration Exploration plus Magdalena exploitation upside that can Longer-term exploitation upside using proven 80,000 provide a possible step change in the production profile technology to unlock material orig
Slide 5: Long-Term Growth Portfolio
Long-Term Growth Portfolio Now the Largest Independent Acreage Holder in Colombia • Awarded 18 blocks in 2021 Colombia bid round (MM) 6 • 16 out of the 18 blocks were nominated by PXT in 2021 Colombia Bid Round Increased Position by ~4.3MM areas specifically targeted by the company 5 • Competitive 9
Slide 6: First-Mover Advantage
First-Mover Advantage • Most extensive land base in the company’s history • Secured rigs to have equipment in place to successfully execute capital investment programs • Increased critical organizational capabilities, adding staff in Canada and Colombia over the past 12 months • Acquired long-lead i
Slide 7: Colombia Provides Top Quartile Netbacks – 2023 Estimates
Colombia Provides Top Quartile Netbacks – 2023 Estimates PXT vs. TSX-Listed Oil & Gas Companies – 2023E Cash Flow Netback (C$/boe) $80 $70 $60 $50 $40 $30 $20 $10 $0 P1 P2 P3 P4 P5 P6 PXT P7 P8 P9 P10 P11 P12 P13 P14 P15 P16 P17 P18 P19 P20 P21 P22 P23 P24 P25 P26 P27 P28 P29 P30 P31 P32 P33 P34 P35
Slide 8: Return of Capital Track Record
Return of Capital Track Record Summary (C$ MM) Levers $1,350 ~$385 >$1,310 • Quarterly dividend $1,200 • Initiated in Q3 2021 of C$0.125 per share $1,050 • Increased to C$0.25 per share or C$1.00 per share on $334 an annualized basis $900 • Share buybacks: active normal course issuer bid $750 (NCIB)
Slide 9: Top-Tier ESG Performance
Top-Tier ESG Performance E Ratings(1) • Reduced scope 1 & 2 GHG emissions intensity by ~34% since 2019 • Invested in geothermal and solar power to lower carbon footprint ESG Score Rating: 75 Top 3 among TSX Capped Energy Index • Spending on biodiversity and land protection Scale: 0 to 100 top score
Slide 10: Production and Reserves Growth
Production and Reserves Growth Production Per Share(1) PDP Reserves Per Share(2) 16% CAGR (2017-2022F) 0.17 19% CAGR (2017-2021) 0.67 0.13 0.14 0.55 0.12 0.50 0.10 0.08 0.40 0.33 2017A 2018A 2019A 2020A 2021A 2022F (3) 2017A 2018A 2019A 2020A 2021A 36 mboe/d Absolute Production Growth CAGR: 8% 53 mb
Slide 11: Funds Flow and Free Funds Flow Growth
Funds Flow and Free Funds Flow Growth FFO [Cash Flow] Per Share(1) FFF [Free Cash Flow] Per Share(2) 32% CAGR (2017-2022F) 7.58 41% CAGR (2017-2022F) 2.75 2.47 2.40 4.61 3.90 2.58 1.13 1.87 2.15 0.63 0.50 2017A 2018A 2019A 2020A 2021A 2022F(3) 2017A 2018A 2019A 2020A 2021A 2022F (3) $289MM Absolute
Slide 12: One of Oil & Gas’ Most Compelling Investments
One of Oil & Gas’ Most Compelling Investments • Asset base can provide sustainable and profitable production growth 2023E EV/DACF(4) • 2022F YoY production growth of 12% (23% on per share basis)(1) 4.6x • Portfolio provides exposure to step change opportunities 2.9x 2.7x • Capital allocation framewo
Slide 13: Strong Free Cash Flow Yield
Strong Free Cash Flow Yield 2023E Debt-Adjusted Free Cash Flow Yield 50% 40% 30% 28% Median: 22% Median: 21% 20% Median: 15% 10% 0% P1 P2 P3 P4 P5 P6 P7 PXT P8 P9 P10 P11 P12 P13 P14 P15 P16 P17 P18 P19 P20 P21 P22 P23 P24 P25 P26 P27 P28 P29 P30 P31 P32 P33 P34 P35 P36 P37 Large/Integrateds Interme
Slide 14: Capital Allocation Framework and Delivery
Capital Allocation Framework and Delivery FFO(1) Capital Allocation • Quarterly dividend increased by 79% to C$0.25 per share >33% Dividends Return of Capital + • 2022 NCIB completed in Q3 2022 Share Buybacks • Return of capital supported by strong free cash flow and development projects that target
Slide 15: Key Takeaways
Key Takeaways Focused on efficient allocation of capital and maximizing Colombia portfolio First-mover advantage: acreage to explore, secured rigs and long-lead items, and strengthened team Forecast YoY production growth of 12% (23% on per share basis)(1) Repurchased over 56 million shares since 201
Slide 16: Appendix – 2022 Corporate Guidance
Appendix – 2022 Corporate Guidance 2020A 2021A 2022F(1) Brent (US$/bbl) $43 $71 $100 Production (boe/d) 46,518 46,998 52,500 Production Growth -12% 1% 12% Production Growth (per share)(2) -7% 12% 23% Shares Repurchased (MM) 14 13 12 Year-End Shares Outstanding (fully diluted; MM) 134 122 110 US$ Fun
Slide 17: Appendix – Attractive Valuation
Appendix – Attractive Valuation 2023E Enterprise Value/Debt-Adjusted Cash Flow Multiple 7.5x 6.0x Median: 4.6x 4.5x Median: 2.9x 3.0x Median: 2.7x 1.9x 1.5x 0.0x P1 P2 P3 P4 P5 P6 PXT P7 P8 P9 P10 P11 P12 P13 P14 P15 P16 P17 P18 P19 P20 P21 P22 P23 P24 P25 P26 P27 P28 P29 P30 P31 P32 P33 P34 P35 P36
Slide 18: Advisories
Advisories This presentation is provided for informational purposes only as of October 24, 2022, is not complete and may not contain certain material information about Parex Resources Inc. ("Parex" or the "Company"), including important disclosures and risk factors associated with an investment in P
Slide 19: Advisories
Advisories Forward-Looking Statements and Financial Outlook (Continued) These forward-looking statements are subject to numerous risks and uncertainties, including but not limited to, the impact of general economic conditions in Canada and Colombia; industry conditions including changes in laws and
Slide 20: Advisories
Advisories Non-GAAP and Other Financial Measures Advisory This presentation uses various "non-GAAP financial measures", "non-GAAP ratios", "supplementary financial measures" and "capital management measures" (as such terms are defined in National Instrument 52-112 – Non-GAAP and Other Financial Meas
Slide 21: Advisories
Advisories Oil & Gas Information and Reserve Advisory (Continued) This presentation contains a number of oil and gas metrics, including operating netbacks and FFO netbacks. These oil and gas metrics have been prepared by management and do not have standardized meanings or standard methods of calcula
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