Touchstone Exploration Inc · TSX:TXP
Touchstone Exploration — Investor Presentation (October 2020)
30 slides from Touchstone Exploration's investor presentation, October 2020
Slide 1: Corporate Presentation
Corporate Presentation Driving growth, profitability and responsibility in the Trinidad oil and gas industry October 2020
Slide 2: Forward Looking Information
Forward Looking Information Unless otherwise stated, all financial amounts herein are presented in United States dollars ("$"). The Company may also reference Canadian dollars ("C$"), Trinidad and Tobago dollars ("TT$") and Pounds Sterling ("£") herein. Certain information regarding Touchstone Explo
Slide 3: Touchstone's Competitive Advantage
Touchstone’s ➢ Proven and experienced leadership team Competitive Advantage ➢ Focused strategy onshore Trinidad oil and gas ➢ Significant exploration opportunities ➢ Becoming a predominant natural gas producer ➢ Fiscal advantage of natural gas in Trinidad 3
Slide 4: Our Four Pillar Corporate Vision
Our Four Pillar Corporate Vision Operating Responsibly Exploration Upside Scalable Economic Growth Value Creation 4
Slide 5: Operating Responsibly
Operating Responsibly ➢ 85% of our workforce are from Trinidad ➢ 24% of our workforce are women ➢ 421 days since an environmental incident and 768 days TRIFF free ➢ Leading industry's initiative to eliminate surface release of produced water ➢ Aiming to capture all solution gas from our wells and sa
Slide 6: Our COVID-19 Response
Our COVID-19 Response ➢ Implementation of strict workplace health and safety procedures ➢ Maintaining business continuity with minimal disruption to our daily operations ➢ Decisive action taken around cost saving initiatives, such as lowering G&A and operating expenses ➢ Continue supporting our loca
Slide 7: Land Holdings
Land Holdings Developed Acreage Exploration Acreage Oil Pool 7,836 net working interest acres 35,785 net working interest acres Proved ("1P") reserves of 10,692 Mbbls(1) Coho – 1P reserves of 1,148 Mboe; 2P reserves of 3,348 Mboe(1) Gas Pool Proved plus probable ("2P") reserves of 18,708 Mbbls(1) Ca
Slide 8: Turbidite Deposition and Proto Orinoco Deltaics
Turbidite Deposition and Proto Orinoco Deltaics Gravity Anomaly Map EASTERN CONTINENTAL SHELF DEPOSITION VENEZUELA ExxonMobil Stabroek 3D BASIN Seismic survey Latin American (2016) Concession Map 8
Slide 9: Ortoire Syncline
NW SE Ortoire Syncline ➢ Accommodation space ➢ Large structures ➢ Repeated beds ➢ Numerous stratigraphic and structural traps ➢ Petroleum system: Within block boundary: ~7 km. long and ~30 km. wide Source, migration, (to Cedar Grove Fault) ~ 36 km reservoir, trap and seal 9
Slide 10: 3D Perspective and Geological Model
3D Perspective and Geological Model Cascadura-1 Cascadura Anticline Chinook-1 Cascadura Deep Chinook Anticline 10
Slide 11: 3D Perspective and Geological Model
3D Perspective and Geological Model Cascadura Anticline Ortoire Syncline Top Cruse Late Miocene gas charged deltaics Chinook Anticline Mid Miocene Herrera turbidites 11
Slide 12: Ortoire Prospectivity
Ortoire N Prospectivity Balata East ➢ Continuation of prolific Penal-Barrackpore Cascadura Herrera Penal / Barrackpore Cedar Grove Fault ➢ Numerous anticlinal trends identified Chinook Royston Coho ➢ Defined structural features: Overthrust, Baraka Intermediate and Subthrust (repeated beds) East Bara
Slide 13: The Ortoire Block - 80% working interest and 35,785 net working interest acres
The Ortoire Block - 80% working interest and 35,785 net working interest acres Balata East Oil 10 MMbbls Pool Pipeline N Gas Discovery W E Pool river Valve Station Pool S CASCADURA Pipeline Well CAS-1ST1 Facility Pipeline tie-in CHINOOK-1 ROYSTON ROYSTON-1 CHINOOK COHO COHO-1 Baraka Central Block Ga
Slide 14: Exploration – Ortoire Block
Balata East 10 MMbbls CASCADURA Exploration – Ortoire Block COHO COHO-1 CAS-1ST1 CHINOOK-1 CHINOOK ROYSTON ROYSTON-1 Baraka Central Block Gas Plant East c. 80 MMcf/d Capacity Baraka c. 40 MMcf/d Throughput Central Block Navette 500 Bcf natural gas, 25 MMboeCatshill Carapal Ridge NGLs 57 MMbbls 30 MM
Slide 15: Coho-1
Coho-1 Flowback testing exceeded expectations(3) 46.0 MMcf/d AOF 11.6 MMcf/d average Estimated gross future production rate(3) 10 – 12 MMcf/d (1,333 – 1,600 boe/d net) Reserves(1) 1P - 1,148 Mboe 2P - 3,348 Mboe 15
Slide 16: Cascadura-1ST1
Cascadura-1ST1 Upper test results(4) 390 MMcf/d AOF 5,472 boe/d average 86% natural gas Lower test results(4) 92 MMcf/d AOF 5,157 boe/d average 87% natural gas Reserves(2) 1P - 23,622 Mboe 2P - 45,030 Mboe 16
Slide 17: Chinook-1
Chinook-1 Drilled to a total depth of 10,039 feet Wireline logs indicate total net pay of 609 feet(5) 589 feet of net pay in the Herrera sands(5) 20 feet of net pay in the shallower Cruse(5) 17
Slide 18: Cascadura-Deep
Cascadura-Deep Anticipated target depth of 10,592 feet Expected spud date Late October / early November Primary target Herrera Gr7a at 7,525 feet Secondary target Herrera Gr7bc at 9,690 feet 18
Slide 19: Royston-1 – Natural Gas Prospect
Shell Trinidad Limited Royston-1 – Natural Gas Prospect Lizard Springs (OL-4) c. 1965 Original well was drilled in 1965. Logs indicated 700 feet of gas effect, but the well was never tested. Ortoire P10 Case Synclinal Basin P50 Case P90 Case ROYSTON-1 LOC 19
Slide 20: 2020 Goals
2020 Goals 2020 Corporate Goals ➢Negotiate and formalize a natural gas marketing contract for the Ortoire block. ➢Drill Chinook-1 and Cascadura-Deep. ➢Bring Coho-1 onto production. ➢Formulate a design for production from the Cascadura- 1ST1 well. 20
Slide 21: Ortoire Block – The Potential
Ortoire Block – The Potential Significant growth opportunity for Touchstone and the Trinidad oil and gas industry ➢ 10+ year drilling program ➢ Identified an additional 21 targets on the block(6) ➢ Partnership with Heritage Petroleum Company Limited and the National Gas Company of Trinidad and Tobag
Slide 22: Scalable Economic Growth
Scalable Economic Growth “A 20-year crude oil drilling program providing Touchstone with a strong organic growth platform.” YTD Q2 crude oil production of 10 Producing fields 208 Drilling locations(7) 1,493 bbls/d 22
Slide 23: Value Creation
Value Creation First Half 2020 Results Capital Structure at October 1, 2020 Petroleum Sales Operating Netback(8)(9) Term Credit Facility Market Capitalization(11) $10,453,000 $14.92/bbl $20,000,000 C$245,262,322 Average Crude Oil Production Common Shares Outstanding 1,493 bbls/d 184,407,761 Funds Fl
Slide 24: Investment Summary
Investment Summary Continuously improve our level of social and environmental responsibility Significant exploration opportunities Inventory of organic growth opportunities from a multi-year production program Strong capital discipline combined with positive cashflow Management and Board have a prov
Slide 25: Corporate Information Abbreviations
Corporate Information Abbreviations Head Office Year End: December 31 bbl(s) barrel(s) Suite 4100, 350 7th Ave SW bbls/d barrels per day Calgary, AB T2P 3N9 Engineers: GLJ Ltd. Mbbls thousand barrels Office: (403) 750-4400 Auditors: Ernst & Young LLP MMbbls million barrels Website: www.touchstoneexp
Slide 26: Endnotes
Endnotes 1) Based on December 31, 2019 GLJ Ltd. independent reserves evaluation. See "Advisories: Oil and Gas Reserves". 2) Based on June 30, 2020 GLJ Ltd. independent reserves evaluation. See "Advisories: Oil and Gas Reserves". 3) See "Advisories: Oil and Gas Test Results". Please refer to the Comp
Slide 27: Endnotes
Endnotes 9) Operating Netback Six months ended ($000’s unless otherwise indicated) June 30, 2020 Petroleum revenue 10,453 Royalties (2,914) Operating expenses (3,462) Operating netback 4,077 Crude oil production (bbls) 273,295 Operating netback ($/bbl) 14.92 10) . ($000’s) June 30, 2020 Current asse
Slide 28: Advisories
Advisories This presentation is for information purposes only and is not under any circumstances to be construed as a prospectus or an advertisement for a public offering of such securities. No securities commission or similar authority in Canada or elsewhere or the Toronto Stock Exchange has in any
Slide 29: Advisories
Advisories Oil and Gas Reserves The reserves information summarized in this presentation are from the Company’s December 31, 2019 and June 30, 2020 independent reserve reports prepared by Touchstone’s independent reserves evaluator, GLJ Ltd. ("GLJ"), dated March 4, 2020 and July 17, 2020, respective
Slide 30: Advisories
Advisories Non-GAAP Measures This presentation may contain terms commonly used in the oil and natural gas industry, such as funds flow from operations, working capital, and operating netback. These terms do not have a standardized meaning under Generally Accepted Accounting Principles ("GAAP") and m
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