Cardinal Energy Ltd. · TSX:CJ

Cardinal Energy — Investor Presentation (May 2023)

28 slides from Cardinal Energy's investor presentation, May 2023

  1. Slide 1: Low Debt, Low Decline, Low Emissions – May 2023

    TSX: CJ LOW DEBT LOW DECLINE LOW EMISSIONS May 2023

  2. Slide 2: Our Business

    Our Business Cash Flow  Amount of capital required to maintain our assets and keep production flat Maintenance Capital  Amount of capital required to fulfill our commitment to operating our business in a responsible manner ARO/ESG  Capital available to our shareholders  Increase the value of the

  3. Slide 3: Annual Results and Budget 2023

    Annual Results and Budget 2023 2022 Annual Budget 2023 Q1 2023 Adjusted Funds Flow $363 MM $270 MM $52.3 MM Capital Expenditures $120 MM $97 MM $25.3 MM ARO Expenditures $20 MM $23 MM $4.8 MM Dividend Rate per month $0.05 - $0.06 $0.06 $0.06 NCIB purchases (3.7 MM shares) $26 MM - - Production (boe/

  4. Slide 4: 2022 Drilling Program – Summary Update

    2022 Drilling Program – Summary Update Success Across all Districts  26 (24.8 net) new wells. Currently producing 3,600 boe/d net, well above our forecast for this point of 3,000 boe/d.  North  Central  Clearwater  Wainwright Rex Hz multilateral  Nipisi – first 4 well pad producing discovery,

  5. Slide 5: 2022 Development Capital Summary

    2022 Development Capital Summary Quarterly Capital by Area Development Capital Expenditures ($MM) 2022 Avg. Prod. 2022 Netback AREA Q1 Q2 Q3 Q4 Total boepd ($MM) Midale, Sask. $2 $7 $5 $4 $18 3,238 $80 Northern Alberta $19 $3 $3 $4 $29 6,881 $111 Central Alberta $3 $4 $7 $5 $19 5,750 $99 Southern Al

  6. Slide 6: 2022 Year End Reserves

    2022 Year End Reserves  Top tier 2022 results  Performance driven by both strong base production NPVBT10 FD&A optimization and better than forecast drilling results Year End 2022 MMBOE (1) (2)(3) Recycle Ratio (4) (MM) ($/boe)  Cardinal 3 average year PDP FD&A $8.61/boe  Large inventory of unboo

  7. Slide 7: 2023 Plan - $97 MM Capital / $23 MM ARO

    2023 Plan - $97 MM Capital / $23 MM ARO Development $43 MM Drill, Complete, Equip and Tie In (17.6 net wells) Optimization $23 MM  Focused drilling program Well Optimization – workovers, pump optimization  Continue to optimize existing production to reduce Waterflood Optimization, reactivations de

  8. Slide 8: Corporate Production

    Corporate Production 25000  Current production ~22,000 boe/d 20000  Majority of production under established secondary or tertiary recovery schemes 15000  Base decline less than 10% Boe/d 10000  Large OOIP properties continue to outperform 5000  Successful optimization initiatives across asset

  9. Slide 9: 2023 Drilling Program

    2023 Drilling Program  Focused development, measured pace, reduce risk  Clearwater (North): 4-5 wells  Wainwright (Central) Rex: 6 wells  Ellerslie (South): 4 wells  EOR development (Midale): 6 wells  Expand core development drilling areas  Increase un-booked drilling inventory – further high

  10. Slide 10: North Area

    North Area  Combination of existing waterflood pools and new area drilling opportunities  Current 5-7 years inventory to keep area flat/slight growth 10 | Cardinal Energy Ltd. | TSX: CJ Please see "Advisory"

  11. Slide 11: Clearwater: Nipisi Optimizing Productivity

    Clearwater : Nipisi Optimizing Productivity 1,200 1,000 800 Boe/d 600 400 200 0 0 50 100 150 200 250 300 350 400 450 Production days 2022 wells 2023 Wells  Excellent 2022 and 2023 wells, 2024 ready  Increased overall reservoir exposure  Phase One Nipisi 2022 - 2024  2022 - 32.8km : 2023 – 41.2km

  12. Slide 12: Central Area

    Central Area  Several long-life oil pools under waterflood  Very low area decline ±5%  Current drilling inventory 10+ years 12 | Cardinal Energy Ltd. | TSX: CJ Please see "Advisory"

  13. Slide 13: Central – Wainwright Rex

    Central – Wainwright Rex  Estimated 200MM barrels original oil in place(1), ~20o API  Q1 23 consolidated land position (green) 2023 planned locations  Up to 90 multi-laterals (3 wells booked at year end)  Existing infrastructure in place  Gas takeaway expected to be in place in Q2 2023 10-7 Dis

  14. Slide 14: Southern Area

    Southern Area  Highest decline area in company ±18%  Combination of older pools under waterflood and new drilling  Current drilling inventory 5+ years 14 | Cardinal Energy Ltd. | TSX: CJ Please see "Advisory"

  15. Slide 15: Ellerslie – Southern Alberta

    Ellerslie – Southern Alberta 2023 planned locations  4 wells planned for summer 2023  Tide Lake (2 wells) objective is to extend multilateral development west and south  Alderson (2 wells) follow up 2021 success and extend 0% royalty production Tide Lake Average Results to Date Drill and Complete

  16. Slide 16: Midale, Saskatchewan – Long Term Development

    Midale, Saskatchewan – Long Term Development 2023 Focus at Midale Midale & Weyburn Background  ~29o API oil, discovered early 1950’s  Continue EOR development add 3 new producers, 3 new WAG injectors  Same zone similar reservoir properties  Test longer laterals  Increase CO2 sequestration Weybu

  17. Slide 17: Focusing on a Sustainable Future – ESG Focus

    Focusing on a Sustainable Future – ESG Focus Environment Social Governance  Indigenous Engagement &  Corporate Governance  CO2 injection exceeds Support  Diversity Scope 1 emissions  Sponsorships  Executive Compensation  Accelerating ARO activity  Standing with Ukraine tied to performance 

  18. Slide 18: Net Negative Carbon Emissions

    Net Negative Carbon Emissions 2022 Cardinal Energy Corporate Emissions 50 100 Thousands Thousands  Differentiated from our Peers Monthly Emissions (t CO2e) / Sequestration (t CO2) Cumulative Emissions (t CO2e) against 'Net Zero' 25 50  Negative Corporate Net Scope 1 CO2e Emissions  Midale, Sask C

  19. Slide 19: ARO Focus

    ARO Focus  A demonstrated financial 2020 2021 2022 2023 commitment Budget Total (million $'s)  Cardinal continues to exceed all regulatory mandated spend CJ ARO Spend $6 $8 $22 $25 $61 requirements & Ongoing Remediation Government Funded Programs $14 $9 $5 - $28  Successful execution of all gover

  20. Slide 20: 2022 ARO Work Completed

    2022 ARO Work Completed Operated Work Completed in 2022  150 Wells Cut and Capped  9 Facilities Abandoned and Decommissioned Spent 3.6 x required  116 wells/sites reclaimed (6 facilities) Regulatory  43 Well Reclamation Certificates Requirement  Abandoned 99 segments (250.76 km) of pipeline  2

  21. Slide 21: Overview

    Overview Drilling Inventories  Established significant 5-20+ year drilling inventories in each operating area. Reduce Business Risk  Less business risk by reducing debt to 0.2x cashflow. Focus on ARO  Significant focus on being good stewards of our land use, supporting sustainability with substan

  22. Slide 22: 2022 Total Recordable Injury Frequency (TRIF)

    2022 Total Recordable Injury Frequency (TRIF*) 12 Month Rolling TRIF 1.0 40,000 0.9 35,000  Annualized recordable injury frequency per 0.8 200,000 hours worked. 30,000 0.7 25,000  There were no lost time, or medical aid injuries to 0.6 Cardinal staff during 2022. 0.49 0.49 0.49 0.49 0.49 0.48 0.48

  23. Slide 23: Regulatory: 2022 Alberta Energy Regulator Cardinal Inspections

    Regulatory: 2022 Alberta Energy Regulator Cardinal Inspections Alberta Cardinal Industry 2022 AER Inspections 109 7,883 % Compliant/Satisfactory 90% 73% 23 | Cardinal Energy Ltd. | TSX: CJ

  24. Slide 24: Tax Pools

    Tax Pools Tax Pool Balance ($ MM) YE 2022 YE 2021 COGPE 454 492  Based on available tax pools, forecasted capital CEE and non capital losses 533 720 expenditures and forecasted commodity prices at December 31, 2022 from the average of three CDE 167 149 independent third party reserve evaluators, Ca

  25. Slide 25: 2023 Budget – Enhance Free Cash Flow

    2023 Budget – Enhance Free Cash Flow Budget  Continue to reduce debt $80 WTI 2023 Budget $3.50/mcf AECO  Increase production volumes ~22,000 boe/d Production (boe/d) ~22,000  Continue to optimize existing asset base Adjusted Funds Flow $270 MM  Execute focused drilling program (17.6 net wells) D

  26. Slide 26: Advisory

    Advisory Note Regarding Forward Looking Statements These forward-looking statements are subject to numerous risks and uncertainties, certain of which are This presentation contains forward-looking statements and forward-looking information (collectively beyond Cardinal's control. Such risks and unce

  27. Slide 27: Advisory

    Advisory to the basic outstanding shares. "Three year average PDP FD&A" is calculated using three-year total Production & Product Type Information capital costs including the change in FDC and reserve additions for the PDP reserves on a weighted References to petroleum, crude oil and natural gas liq

  28. Slide 28: Advisory

    Advisory Other Financial Measures" in the Company's MD&A as at and for the three months and year ended Netback per boe December 31, 2022 for an explanation of each measure noted below, as well as a detailed calculation and Cardinal utilizes netback per boe to assess Cardinal’s operating performance

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