Baytex Energy Corp. · TSX:BTE
Baytex Energy — Investor Presentation (June 2017)
29 slides from Baytex Energy's investor presentation, June 2017
Slide 1: June Presentation
: BAYTEX June Presentation
Slide 2: Advisory
Advisory Forward-Looking Statements In the interest of providing Baytex's shareholders and potential investors with information regarding Baytex, including management's assessment of Baytex's future plans and operations, certain statements made by the presenter and contained in these presentation ma
Slide 3: Advisory (Cont.)
Advisory (Cont.) Readers are cautioned that the foregoing list of risk factors is not exhaustive. New risk factors emerge from time to time, and it is not possible for management to predict all of such factors and to assess in advance the impact of each such factor on our business or the extent to w
Slide 4: Advisory (Cont.) – Non-GAAP Financial Measures
Advisory (Cont.) Non-GAAP Financial Measures This presentation refers to funds from operations, net debt, free cash flow, sustaining capital, operating netback and Bank EBITDA, which do not have any standardized meaning prescribed by generally accepted accounting principles in Canada ("GAAP"). We de
Slide 5: Baytex Key Attributes
Baytex Key Attributes Strategy to Sustain and Position Baytex for Growth 2/3 undrawn on US$575 DC&E costs 45% in the million credit facility Eagle Ford First meaningful long-term Operating expenses per note maturity not until 2021 boe 21% Expect stable liquidity Transportation expense
Slide 6: Corporate Profile
Corporate Profile Market Summary Ticker Symbol TSX / NYSE: BTE Average Daily Volume (1) CAN: 5,500,000 / US: 1,600,000 Shares Outstanding 234.2 million Market Capitalization / Enterprise Value $0.9 billion / $2.8 billion Net Debt (2) $1.9 billion Corporate Summary Production (3) 68,000 – 70,000 boe/
Slide 7: Capital Deployment Opportunities
Capital Deployment Opportunities Texas 34% Eagle Ford Texas 34% Peace River Heavy Oil First call on capital Strategic Light Oil $65 51% million acquisition 22% adds 3,000 Represents ~ 70% of boe/d of production 2017 budgeted E&D spending Drilling program commenced in Q1/2017 Currently runn
Slide 8: Q1/2017 Results Demonstrate Ability to Sustain and Grow Production
Q1/2017 Results Demonstrate Ability to Sustain and Grow Production in Today’s Crude Oil Price Environment 6% Production Growth in Q1/2017 Production growth of 6% 80,000 o 8% Eagle Ford; 5% Canada 70,000 FFO of $81 million 60,000 50,000 Building Operational Momentum Boe/d 40,000 Canada 30,000 U
Slide 9: 2017 Sustaining Capital and Free Cash Flow Scenarios
2017 Sustaining Capital and Free Cash Flow Scenarios Strong Capital Efficiencies Drive Low Sustaining Capital Requirements Significant Free Cash Flow Potential Total Sustaining Capital ~ $300 million Conventional Flexibility to invest in ~ 34,000 boe/d Lloydminster Sustaining Capital $200 organic gr
Slide 10: Crude Oil Hedge Portfolio
Crude Oil Hedge Portfolio Q1/17 Q2/17 Q3/17 Q4/17 2017 2018 WTI Fixed Hedges Volumes (bbl/d) 3,500 3,500 3,500 3,500 3,500 1,000 Fixed Price (US$/bbl) $54.46 $54.46 $54.46 $54.46 $54.46 $54.00 WTI 3-Way Option Volumes (bbl/d) 14,500 14,500 14,500 14,500 14,500 2,000 Average Ceiling/Floor/Sold Floor
Slide 11: Balance Sheet / Debt Composition
Balance Sheet / Debt Composition Significant Liquidity, No Near-Term Maturities and Financial Covenant Flexibility 0.7x Senior Secured Debt (2) to Bank EBITDA (3) (maximum 5.0x through March 2018) 4.0x Interest Coverage (4) (minimum 1.25x through March 2018) Debt Composition(1) and Unutilized Capaci
Slide 12: Strong Rates of Return Across Portfolio
Strong Rates of Return Across Portfolio 175% 150% Internal Rate of Return (3) 125% Break-Even WTI (4) 100% 75% Eagle Ford - US$5.0M/well 50% Peace River - C$2.5M/well 25% Lloydminster - C$700K/well 0% $45 $50 $55 $60 $65 $70 WTI (US$/bbl) (1) Individual well economics are based on constant pricing a
Slide 13: Individual Well Economics – Sensitivity to WTI
Individual Well Economics – Sensitivity to WTI IRR (3) NPV (C$000s) – 10% discount rate Eagle Ford Peace River Lloydminster Eagle Ford Peace River Lloydminster US$45 58% 25% 35% US$45 $5,943 $716 $262 US$50 76% 50% 67% US$50 $7,502 $1,611 $581 US$55 96% 79% 105% US$55 $9,061 $2,459 $900 US$60 120% 1
Slide 14: The Eagle Ford
BAYTEX The Eagle Ford
Slide 15: Eagle Ford Development – Activity Shifts to Northern Oil Window
Eagle Ford Development – Activity Shifts to Northern Oil Window Premier Resource Play 30-day IP rates in 2016 of 1,300 boe/d (36 net wells), up 20% from 2015. Record low DC&E costs of US$4.5 million while increasing proppant intensity. 2017 Development Production up 8% in Q1/2017 to 36,000 boe
Slide 16: Eagle Ford Q1/2017 Well Performance
Eagle Ford Q1/2017 Well Performance Franke May A Medina Jonas A 3 well oil pad 3 well oil pad LEF (3) LEF (3) Avg 30 day IP: 1,107 BOED Avg 30 day IP: 1,448 boe/d Best Well: 1,362 BOED Best Well: 1,551 boe/d Direct Assets Culberson Patteson 4 well condensate pad 3 well condensate pad LEF (3) / AC (1
Slide 17: Eagle Ford Performance
Eagle Ford Performance Improved Performance and Efficiency Improvements in drilling and completion design have increased 30-day IP rates by approximately 105% since Q4/2011 with 180-day cumulative recovery increasing 63% over the same time period Drilling times have decreased by 63% since Q4/201
Slide 18: Completion Improvements
Completion Improvements Increased Lateral Length, Frac Stages and Proppant Lateral Length and Total Depth Per Well Frac Stages and Proppant Per Well 18
Slide 19: Heavy Oil Overview
BAYTEX ENERGY CORP.
Slide 20: Peace River Heavy Oil – Strategic Acquisition
Peace River Heavy Oil Strategic Acquisition More than Doubles Land Base and Increases Inventory by 75% Q1/2017 Drilling Program Initiated 4 wells (average 12 laterals per well) drilled in Q1/2017 First two wells generated 30-day IP’s of 614 bbl/d and 489 bbl/d Peace River Acquisition Integrati
Slide 21: Multi-Lateral Horizontal Wells
Multi-Lateral Horizontal Wells Reservoir Characteristics (1) Formation Bluesky Depth ~ 600 metres Completion Open Hole Oil Quality 11 °API Average Porosity 28% Permeability 1 - 5 darcies Oil Saturation 70% Recovery Factor 5 - 7% (1) Baytex internal estimates. Drilling Program Commenced in Q1/2017
Slide 22: Lloydminster Heavy Oil – Significant Land Position and Drilling Inventory
Lloydminster Heavy Oil Significant Land Position and Drilling Inventory Multi-Lateral Drilling Applying multi-lateral horizontal drilling and production techniques from Peace River 25% improvement in individual well capital efficiencies compared to single-lateral horizontal wells. Q1/2017 Dril
Slide 23: Lloydminster Development
Lloydminster Development Increased Multi-Lateral Drilling at Lloydminster is Leading to a 25% Improvement in Capital Efficiencies Reservoir Characteristics (1) Formation Mannville Group Depth 350 – 800 metres Completion Horizontal Slotted Liner / Vertical Stacked Pays Oil Quality 10 – 16 °API Aver
Slide 24: Summary
Summary 2017 Budget E&D capital: $325-$350 million; Production: 68,000-70,000 boe/d Organic growth rate of 5-6% based on expected exit production rates for 2016 and 2017. High Quality Assets with Strong Capital Efficiencies Capital efficiencies on an annual basis of $11,500 per boe/d ($13,
Slide 25: Supplementary Information
- Tat Supplementary Information enero
Slide 26: Funds from Operations Sensitivities
Funds from Operations Sensitivities Estimated Effect on Annual Funds from Operations ($ Millions) Sensitivities Excluding Hedges Including Hedges Change of US$1.00/bbl WTI crude oil $18.0 $18.0 Change of US$1.00/bbl WCS heavy oil differential $9.9 $9.2 Change of US$0.25/mcf NYMEX natural gas $4.0 $1
Slide 27: Natural Gas Hedge Portfolio
Natural Gas Hedge Portfolio Q1/17 Q2/17 Q3/17 Q4/17 2017 2018 AECO Fixed Hedges Volumes (GJl/day) 22,500 22,500 22,500 22,500 22,500 5,000 Price (C$/GJ) $2.85 $2.85 $2.85 $2.85 $2.85 $2.67 NYMEX Fixed Hedges Volumes (mmbtu/d) 22,500 22,500 22,500 22,500 22,500 7,500 Price (US$/mmbtu) $2.98 $2.98 $2.
Slide 28: Capital Program Efficiency
Capital Program Efficiency 3-Year 2014 2015 2016 Total / Average 2014-16 Capital Expenditures ($millions) Exploration and development 766.1 521.0 224.8 1511.9 Acquisitions (net of dispositions) 2,545.1 1.6 (63.6) 2483.1 Total 3,311.2 522.7 161.2 3995.0 Proved plus Probable Reserve Additions (mboe) E
Slide 29: Contact Information
Contact Information Edward D. LaFehr President and Chief Executive Officer (587) 952-3000 Suite 2800, Centennial Place Rodney D. Gray 520 – 3rd Avenue S.W. Chief Financial Officer Calgary, Alberta T2P 0R3 (587) 952-3160 T: (587) 952-3000 1-800-524-5521 www.baytexenergy.com Brian G. Ector Senior Vice