Canadian Natural Resources Limited · TSX:CNQ
Canadian Natural Resources — Investor Presentation (March 2021)
36 slides from Canadian Natural Resources's investor presentation, March 2021
Slide 1: Corporate Presentation March 2021
Canadian Natural Corporate Presentation March 2021
Slide 2: Delivering Value & Growth
Delivering Value & Growth SNAPSHOT 2021F 2020 2019 Capital expenditures – net (C$ million)(1) $3,205 $2,701 $3,904 Annualized dividend (C$/share)(2) $1.88 $1.70 $1.50 Production (annual average, before royalties) Natural gas (MMcf/d) 1,620 - 1,680 1,477 1,491 Crude Oil (Mbbl/d) 920 - 980 918 850 BOE
Slide 3: Canadian Natural's Assets are Unique
Corporate Presentation March 2021 Canadian Natural Advantages Large, Long Life Low Decline Asset Base Diversified Asset Base & Product Mix Flexible Capital Allocation / Effective & Efficient Operations Low Maintenance Capital Leading Free Cash Flow Generation SUSTAINABLE RETURNS TO SHAREHOLDERS 2 Ca
Slide 4: 1P Reserves After Royalties
Corporate Presentation March 2021 1P Reserves After Royalties 2020 (MMBOE) 12,000 ~83% of reserves are Long Life Low Decline 10,000 Reserve Life Index ~30 plus years* 8,000 Oil Sands Mining Reserve Life Index ~44 plus years* 6,000 4,000 2,000 0 Integrated Peers Peers *Reserve Life Index based upon 2
Slide 5: Balanced, Diverse Portfolio
Corporate Presentation March 2021 Balanced, Diverse Portfolio • Balanced, diverse production mix North ‒ Long Life Low Decline production ~81% of liquids Sea North America • International Brent exposure • Vast, balanced resource base to develop • Light crude oil and SCO production ~48% of BOEs • Nat
Slide 6: 2020 Annual Operational Highlights
Corporate Presentation March 2021 Canadian Natural 2020 Annual Operational Highlights • Strong operations maximized value for shareholders ‒ Record production of ~1,164 MBOE/d Record liquids production of 917,958 bbl/d Thermal in situ produced record daily production of 248,971 bbl/d, an increas
Slide 7: Operational Excellence; Near- & Mid-Term Growth Potential
Corporate Presentation March 2021 Operational Excellence • Area knowledge, extensive infrastructure and operatorship • Top tier effectiveness and efficiency • Strong history of capturing margin growth opportunities • Process optimization and improvement • Technology and innovation • Economies of sca
Slide 8: Low Corporate Decline Rate
Corporate Presentation March 2021 Canadian Natural Advantages Large, Long Life Low Decline Asset Base Diversified Asset Base & Product Mix Flexible Capital Allocation / Effective & Efficient Operations Low Maintenance Capital Leading Free Cash Flow Generation SUSTAINABLE RETURNS TO SHAREHOLDERS 12 C
Slide 9: 2020 Free Cash Flow
Corporate Presentation March 2021 Canadian Natural Advantages Large, Long Life Low Decline Asset Base Diversified Asset Base & Product Mix Flexible Capital Allocation / Effective & Efficient Operations Low Maintenance Capital Leading Free Cash Flow Generation SUSTAINABLE RETURNS TO SHAREHOLDERS 14 2
Slide 10: Long Term Dividend Growth vs. Peers
Corporate Presentation March 2021 Long Term Dividend Growth vs. Peers 10 Year CAGR (% CAGR) CNQ increased dividend in 2020 20% 5 peers decreased their dividend 15% 4 peers maintained their dividend 3 peers increased their dividend 10% 5% 0% -5% -10% Peer Average -15% -20% Peers Integrated Peers (31.
Slide 11: Financial Strength: Balancing the Four Pillars
Corporate Presentation March 2021 Financial Strength Balancing the Four Pillars • Balance Sheet Strength ‒ Balance Sheet strengthens with free cash flow generation Maximizing Shareholder Value • Returns to Shareholders ‒ Growing, sustainable dividends ‒ Potential for share repurchases Balance Sheet
Slide 12: 2020 Annual Financial Highlights
Corporate Presentation March 2021 Canadian Natural 2020 Annual Financial Highlights • Significant adjusted funds flow of $5,340 million(1) ‒ Free cash flow of ~$690 million in 2020(2) • Disciplined capital budget ‒ ~$2.7 billion capital program(3) • Balance sheet is strong ‒ Significant liquidity of
Slide 13: 2021 Budget
Corporate Presentation March 2021 Canadian Natural 2021 Budget Capital Expenditures ($ million) 2020 2021B Total(1) $2,701 $3,205 Targeted Production 2020 2021B % Change(2) Natural Gas (MMcf/d) 1,477 1,620 - 1,680 ~12% Total Liquids (Mbbl/d)(3) 918 920 - 980 ~3% Total MBOE/d 1,164 1,190 - 1,260 ~5%
Slide 14: Balanced Credit Facility Profile
Corporate Presentation March 2021 Canadian Natural Balanced Credit Facility Profile Revolving Credit Facilities (C$ million) Fully Drawn Term Credit Facilities(1) (C$ million) June 2022(1) $2,425 February 2023(2) $1,000 June 2023(1) $2,425 June 2022(3) $2,725 Operating demand loan $100 February 2023
Slide 15: Returns to Shareholders – Dividends
Corporate Presentation March 2021 Canadian Natural Returns to Shareholders – Dividends ($ million) 2,250 2,000 21 years of dividend increases 1,750 ~20% CAGR since inception Horizon Phase 3 1,500 complete 1,250 1,000 750 500 Horizon Phase 1 build years 250 0 2006 2007 2008 2009 2010 2011 2012 2013 2
Slide 16: Asset Overview
Corporate Presentation March 2021 Canadian Natural Advantages Summary (cont’d) • Flexible capital allocation and effective and efficient operations ‒ Culture of innovation drives ever increasing effective and efficient operations ‒ Flexible capital allocation to maximize value ‒ Low maintenance capi
Slide 17: Natural Gas, Light Crude Oil & NGLs Core Area Summary
Corporate Presentation March 2021 Natural Gas, Light Crude Oil & NGLs Core Area Summary • Large, Canadian, natural gas producer ‒ 2020 1,477 MMcf/d ‒ 2020 operating costs $1.14/Mcf • Significant light crude oil and NGL production base in Canada ‒ 2020 84,658 bbl/d ‒ 2020 operating costs $14.61/bbl •
Slide 18: Thermal In Situ Oil Sands Asset Overview
Corporate Presentation March 2021 Thermal In Situ Oil Sands Asset Overview CNQ Thermal Producing Properties Birch Mtn. • Long Life Low Decline assets CNQ In Situ Project Inventory Peers ‒ ~122 billion barrels BIIP(1) Ells River • Facility capacity of ~340,000 bbl/d(2) Liege ‒ 2020 production 248,971
Slide 19: Oil Sands Mining & Upgrading
Corporate Presentation March 2021 Oil Sands Mining & Upgrading • Industry leading oil sands mine operator ‒ Net capacity ~475,000 bbl/d of SCO CNQ Operating Oil Sands Mines CNQ Lands ‒ December 2020 record of ~490,800 bbl/d of SCO • No decline, reservoir risk or reserve replacement cost ‒ 50+ year r
Slide 20: Long Term Sustainability
Corporate Presentation March 2021 Oil Sands Mining & Upgrading Summary • Long Life, no decline assets ‒ ~475,000 bbl/d net capacity • Capturing synergies through technology and innovation ‒ Reliability and capacity increases ‒ In-Pit Extraction Process Targeting • Effective and efficient operations
Slide 21: The World Needs More Canadian Energy
Corporate Presentation March 2021 The World Needs More Canadian Energy (Aggregate ESG Score) 300 Environment(1) Social(2) 250 Governance(3) 200 Average 150 100 50 0 (1) 2020 Yale Environment Protection Index (EPI). (2) 2020 Social Progress Index (SPI) prepared by Social Progress Imperative. (3) 2019
Slide 22: 2020 Environmental Achievements
Corporate Presentation March 2021 2020 Environmental Achievements • Canadian Natural's corporate GHG emissions intensity continues to improve ‒ Decreased by 18% from 2016 levels ‒ Decreased by 2% from 2019 levels • One of the largest owners of Carbon Capture and Storage and sequestration capacity gl
Slide 23: Governance and Risk Assessment
Corporate Presentation March 2021 Governance Risk Assessment & Mitigation • Strong track record of identifying, assessing, adapting, aligning and executing • Board of Directors as well as Board Governance and Risk Committees ‒ Review and hold management accountable to identify and mitigate risks • S
Slide 24: Canada's Crude Oil & Natural Gas Sector Has Delivered
Corporate Presentation March 2021 Canada’s Crude Oil & Natural Gas Sector Has Delivered Advancing Innovation • Recognize the need to reduce GHG emissions ~$3.9 Billion • Leverage technology and Canadian ingenuity INVESTED IN RESEARCH & DEVELOPMENT* • Opportunities to reduce emissions further ~$77.4
Slide 25: Leading Canadian Oil Sands Intensity
Corporate Presentation March 2021 Leading Canadian Oil Sands Intensity GHG Emissions Intensity (kgCO2/bbl) 80 70 60 50 ~35% 40 LOWER THAN TOTAL PEER UPSTREAM SCOPE 1 AVERAGE 30 20 10 0 Total Peer Oil Sands Note: Represents Oil Sands emissions intensity in Canada (mining & thermal in situ). Performan
Slide 26: Technology & Innovation: Journey to Net Zero
Corporate Presentation March 2021 Technology & Innovation Journey to Net Zero Near-Term Actions Medium-Term Actions Long-Term Actions • IPEP pilot • IPEP commercialization • Carbon capture and conversion (carbon fibers, asphalts, plastics) • Solvent EOR pilots • Solvent EOR commercialization • Molte
Slide 27: Notes
Notes
Slide 28: Notes
Notes
Slide 29: Advisory: Forward-Looking Statements
Advisory Special Note Regarding Forward-Looking Statements Certain statements relating to Canadian Natural Resources Limited (the "Company") in this document or documents incorporated herein by reference constitute forward-looking statements or information (collectively referred to herein as "forwar
Slide 30: Advisory: Non-GAAP Financial Measures
Advisory Special Note Regarding non-GAAP Financial Measures This presentation includes references to financial measures commonly used in the crude oil and natural gas industry, such as: adjusted net earnings (loss) from operations, adjusted funds flow and net capital expenditures. These financial me
Slide 31: Advisory: Cautionary Statement
Advisory Cautionary Statement Project progress and financial results are dependent upon economic and regulatory conditions, commodity prices, global economic factors, project sanction and capital allocation. Thermal In Situ Oil Sands Overview – Clearwater, McMurray, Bluesky, Grand Rapids and Grosmon
Slide 32: Advisory: Pricing Assumptions and Glossary
Advisory Pricing Assumptions 2021F* 2020 2019 Strip US$ WTI/bbl $ 57.28 $ 39.40 $ 57.04 C$ AECO/GJ $ 2.88 $ 2.12 $ 1.54 SCO Diff/(Prem) US$/bbl $ 2.34 $ 3.14 $ 0.69 WCS Differential US$/bbl $ 11.77 $ 12.57 $ 12.79 FX 1.00 US$ = X C$ $ 1.27 $ 1.34 $ 1.33 *Strip pricing as of February 16, 2021. Glossa
Slide 33: Advisory: Reserves Notes
Advisory Reserves Notes: 1. Company Gross reserves are working interest share before deduction of royalties and excluding any royalty interests. 2. Information in the reserves data tables may not add due to rounding. BOE values and oil and gas metrics may not calculate exactly due to rounding. 3. Fo
Slide 34: Hedging
Hedging At December 31, 2020, the Company had the following derivative financial instruments outstanding to manage its commodity price risk: Weighted average Weighted average Remaining term volume price Index Natural Gas Fixed price swap Jan 2021 - Dec 2021 37,337 GJ/d $2.03/GJ AECO Jan 2021 - Dec 2
Slide 35: Key Historic Data
Key Historic Data Operational & Financial Information 2020 2019 2018 2017 2016 Daily production, before royalties Crude oil and NGLs (Mbbl/d) 918 850 821 685 524 Natural gas (MMcf/d) 1,477 1,491 1,548 1,662 1,691 Barrels of oil equivalent (MBOE/d) 1,164 1,099 1,079 962 806 Daily production, after ro
Slide 36: Management and Investor Relations Contacts
Tim S. McKay Darren Fichter Scott G. Stauth Mark Stainthorpe President Chief Operating Officer, Chief Operating Officer, Chief Financial Officer and Exploration and Production Oil Sands Senior Vice-President, Finance Jason Popko Lance Casson Jason Fleury Manager, Analyst, Analyst, Investor Relations
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