Obsidian Energy Ltd · TSX:OBE
Obsidian Energy — Investor Presentation (September 2023)
27 slides from Obsidian Energy's investor presentation, Sep 21, 2023
Slide 1: Obsidian Energy Ltd. Three-Year Growth Plan
Obsidian Energy Ltd. Three-Year Growth Plan September 21, 2023 TSX:/NYSE American: OBE
Slide 2: Advisory
ADVISORY OVERVIEW This presentation should be read in conjunction with the Company’s unaudited consolidated interim financial statements and Management’s Discussion and Analysis (“MD&A”) for the three and six months ended June 30, 2023, and audited consolidated annual financial statements and MD&A f
Slide 3: Corporate Overview
CORPORATE OVERVIEW OVERVIEW World class assets and experienced team delivering value People, assets, discipline, return-focus and execution strength CORPORATE SUMMARY MARKET SUMMARY Q2 2023 Production 2023E 32,125 boe/d Shares outstanding 80.0 million 31,042 boe/d YoY production growth* 5% Market ca
Slide 4: Strategic Overview
STRATEGIC OVERVIEW OVERVIEW Reshaped the Company and ready to unlock the value of Obsidian Energy’s assets 2020 – 2022: RESHAPED COMPANY AND BUSINESS ‣ Refinanced reserve-based loan and completed successful high-yield debenture offering ‣ Renegotiated other liabilities including office lease ‣ Purch
Slide 5: Our Peace River Journey
OUR PEACE RIVER JOURNEY OVERVIEW 2021 – 2023 actions focused on improving asset potential for future growth Increased land position and production, delineated acreage, expanded infrastructure and discovered a new development area TSX:/NYSE American: OBE September 2023 | THREE-YEAR GROWTH PLAN PRESEN
Slide 6: Why Peace River Growth
WHY PEACE RIVER GROWTH OVERVIEW Underdeveloped land base supports increased capital investment, strong returns and value creation Peace River asset significantly under-exploited (only 34 sections developed of 500); recent technical work and PROVIDES SUBSTANTIAL UPSIDE drilling success led to creatio
Slide 7: Three-Year Growth Plan Financials
THREE-YEAR GROWTH PLAN FINANCIALS OVERVIEW Compelling value proposition with accelerated production, and both free cash and funds flow growth for strong per share metrics 2024F 2025F 2026F Peace River (heavy oil) 8,500 boe/d 15,500 boe/d 24,000 boe/d PRODUCTION GROWTH TO 50,000 BOE/D WG, Pembina, Vi
Slide 8: Peace River Multi-Zone Opportunities
PEACE RIVER MULTI-ZONE OPPORTUNITIES PEACE RIVER Creating value applying multi-zone development across our Peace River asset ‣ Bluesky: ‣ Multi-stacked drilling Apply learnings from ‣ 4 – 8 wells per section, Bluesky and Clearwater FORMATION depending on zone thickness COLORADO SHALE exploration/app
Slide 9: Depth of Inventory
DEPTH OF INVENTORY PEACE RIVER Internal technical analysis and delineation identified un-risked inventory, opening new plays for future production and reserves Bluesky Bluesky Updated location inventory supported by: Clearwater (Walrus South, (Walrus South, ‣ A rebuilt Peace River development team f
Slide 10: Bluesky Area Overview
BLUESKY AREA OVERVIEW PEACE RIVER Strong technical work provides foundation for increased development opportunities and future growth NAMPA WALRUS ‣ 36 inventory locations ‣ Recent appraisal/exploration ‣ 12 locations proposed in three-year success unlocked new field growth plan ‣ Stacked pay potent
Slide 11: Clearwater Area Overview
CLEARWATER AREA OVERVIEW PEACE RIVER Strong technical work provides foundation for increased development opportunities and future growth NAMPA SEAL MAIN ‣ Recent OSE drilling success (2023) ‣ 80 inventory locations identified ‣ Mapping indicates large ‣ 12 locations proposed in three- development po
Slide 12: Dominant Infrastructure and Capacity for Growth
DOMINANT INFRASTRUCTURE AND CAPACITY FOR GROWTH PEACE RIVER Owned infrastructure results in beneficial cost structure and capacity for additional production oil sales point major gas pipeline ‣ Access to many regional sales points for Peace River Oil battery major oil pipeline volumes Plains Nipisi
Slide 13: Peace River Summary
PEACE RIVER SUMMARY PEACE RIVER Considerable growth and upside potential for Bluesky and Clearwater development ‣ Three-year production growth to average 24,000 boe/d in PEACE RIVER PRODUCTION GROWTH 2026 25,000 boe/d ‣ Weighted towards de-risked Bluesky development with recent success/new core deve
Slide 14: Light Oil Asset Strategy
LIGHT OIL ASSETS LIGHT OIL ASSET STATEGY History of highly economic returns with years of low-risk inventory Cardium (Willesden Green/Pembina) ‣ One of North America’s most significant light oil fields with the dominant land position among peers ‣ Significant reserve-based inventory of compelling dr
Slide 15: Light Oil Asset Strategy
LIGHT OIL ASSET STRATEGY LIGHT OIL ASSET STATEGY Foundational assets with established track record of high IP rates, strong returns and quick payouts STRATEGY STABLE LIGHT OIL PRODUCTION ‣ Accelerate activity in Q4 2023 then maintain production levels throughout three-year plan to preserve long-term
Slide 16: Three-Year Growth Plan Summary
THREE-YEAR GROWTH PLAN SUMMARY GRWOTH PLAN SUMMARY Compelling value proposition with accelerated production, and both free cash and funds flow growth for strong per share metrics 2024F 2025F 2026F OBE PRODUCTION Average production 36,000 boe/d 42,000 boe/d 50,000 boe/d Capital expenditures $380 mill
Slide 17: Revised 2023 Guidance
REVISED 2023 GUIDANCE 2023 GUIDANCE Balancing production growth, debt reduction and return of capital to shareholders 2022 August 2023E Revised 2023E (Sept/23) ‣ Revised 2023E commodity price assumptions are forecasted from Average production 30,682 boe/d 31,500 – 32,500 boe/d 31,750 – 32,500 boe/d
Slide 18: Why Invest in Obsidian Energy
WHY INVEST IN OBSIDIAN ENERGY SUMMARY Peace River growth area combined with established light oil production offers upside potential for shareholders GROWTH STRATEGY ‣ Strategy focused on growing Peace River production and per share metrics, with option to return capital to shareholders and/or furth
Slide 19: Endnotes
Endnotes TSX:/NYSE American: OBE
Slide 20: Endnotes
ENDNOTES ENDNOTES Slide 3: Corporate Overview Slide 10, 11: Bluesky Area Overview / Clearwater Area Overview Market capitalization and enterprise value was determined with share price on the close of business on Individual play fairways are Obsidian Energy defined trends displaying similar reservoir
Slide 21: Endnotes, Cont.
ENDNOTES, CONT. ENDNOTES Slide 17: Revised 2023 Guidance Slide 17: Revised 2023 Guidance, cont. Revised 2023E guidance calculated on September 18, 2023. Revised 2023E guidance FFO and FCF include risk management (hedging) adjustments up to September 18, 2023, and includes approximately $5 million of
Slide 22: Definitions and Industry Terms
DEFINITIONS AND INDUSTRY TERMS ENDNOTES 2023E means the expected 2023 results, based on internal F&D means finding and development cost, and refers to costs NPV or NPV Btax 10% means net present value, before tax assumptions and estimates incurred when a company purchases, researches and develops di
Slide 23: Non-GAAP Measures Advisory
NON-GAAP MEASURES ADVISORY ENDNOTES Throughout this presentation and in other materials disclosed by the Company, we employ certain measures to analyze financial performance, financial position and cash flow. These non-GAAP and other financial measures do not have any standardized meaning prescribed
Slide 24: Oil and Gas Information Advisory
OIL AND GAS INFORMATION ADVISORY ENDNOTES Barrels of oil equivalent (“boe”) may be misleading, particularly if used in isolation. A boe conversion The Company has an aggregate of 284 (233 net) booked proved locations and 372 (311 net) booked ratio of six thousand cubic feet of natural gas to one bar
Slide 25: 2022 Reserves Disclosure and Definitions
2022 RESERVES DISCLOSURE AND DEFINITIONS ENDNOTES Unless otherwise noted, any reference to 2022 reserves in this presentation are based on the report (the “2022 Each of the reserves categories (proved and probable) may be divided into developed and undeveloped categories: Reserves Report”) prepared
Slide 26: Forward-Looking Information Advisory
FORWARD-LOOKING INFORMATION ADVISORY ENDNOTES Certain statements contained in this document constitute forward-looking statements or information (collectively The key metrics for the Company set forth in this presentation may be considered to be future-oriented financial "forward-looking statements"
Slide 27: Forward-Looking Information Advisory (Cont.)
FORWARD-LOOKING INFORMATION ADVISORY (CONT.) ENDNOTES natural gas production levels; future exchange rates and interest rates; future debt levels; our ability to execute our transition towards less reliance on fossil fuels and/or other factors; the risk that the financial capacity of the capital pro
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