Saturn Oil & Gas Inc. · TSX:SOIL
Saturn Oil & Gas — Investor Presentation (October 2021)
28 slides from Saturn Oil & Gas's investor presentation, October 2021
Slide 1: Corporate Presentation
October 2021 TSX-V: SOIL FSE: SMKA CORPORATE PRESENTATION
Slide 2: The Saturn Opportunity
THE SATURN OPPORTUNITY 95% Oil Weighted Production Base Pursuing Multiple Opportunities For Growth Optimization High Quality Proven Meaningful of Existing Drilling Growth Shareholder Production Inventory Strategy Value Creation Low-cost production adds Positioned in two of the Recent transformationa
Slide 3: Oxbow Transformational Acquisition
OXBOW TRANSFORMATIONAL ACQUISITION $76.8M 6,400 boe/d +2,000% 1.5x 1,300% Net Cash Price Net Production Added at Production Increase1 Proforma corporate PDP Reserves Increase1 Closing Date D/CF2 Acquisition Highlights $119M Transaction Financing High net back production - 95% crude oil & liquids: $8
Slide 4: Oxbow Optimization Opportunity
OXBOW OPTIMIZATION OPPORTUNITY Immediate Strategy of Enhancing Current Production Base ~1,100 producing wells and 400+ non-producing wells to optimize ▪ 3,500 bbls/d of workover potential identified1 ▪ Target capital efficiencies of $5,000/bbl/d2 ▪ Activities include: acidization, perforation, scab
Slide 5: Oxbow Drilling Opportunity
OXBOW DRILLING OPPORTUNITY Vast Inventory of Drilling Opportunities for Growth Saturn Land 242 booked drilling locations with certified reserves1 ▪ Over 20,000 bbls/d of production additions from booked locations ▪ Over 100+ additional drilling locations identified & un-booked ▪ 137,186 acres (214 s
Slide 6: Oxbow Acquisition Economics
OXBOW ACQUISITION ECONOMICS Production Funds Strong Free Cash Flow After Debt Repayment and ARO Expenditures1 ▪ Total Proved Forecast Cash Flow (undiscounted) of $564.3M funds: Total Proved Future Cash Flow Allocation (undiscounted) • Term loan repayment and interest = $100.2M • Abandonment Retireme
Slide 7: Corporate Profile – TSX.V: SOIL FSE: SMK
CORPORATE PROFILE – TSX.V: SOIL FSE: SMK FINANCIAL Conservative Balance Sheet Management Shares Outstanding 25.1M ▪ Modest debt levels of ~1.3x annualized cash flow1 Options (avg. exercise $2.50) 2.0M SOIL.WT Warrants (exercise = 20 warrants +$3.20) 268.3M ▪ Base production funds 100% debt repayment
Slide 8: Q2 2021 Highlights
Q2 2021 HIGHLIGHTS Oxbow Acquisition Closed June 7, 2021 – Contributed only 23 Days to the 2nd Quarter ▪ During last 23 days of the period: • Revenue of $520,000 per day • Operating Cash flow of $265,000 per day1 Q2 2021 Oil & NGL % of Production Q2 2021 Operating Netback ($/boe)1 2022E EV/DACF2 Ave
Slide 9: Net Asset Value
NET ASSET VALUE Saturn Shares are Backed with Solid Asset Value1 Long Life Assets Generate Strong Cash Flows ▪ 20-year P+P Reserve Life Index (RLI)2 ▪ Full exercise of warrants and options provides $61.5M in proceeds (average exercise price $3.12 / share) ▪ Total Proved FD NAV = $6.97 / share Natura
Slide 10: The Saskatchewan Advantage
THE SASKATCHEWAN ADVANTAGE Saturn: 95% oil, 100% Saskatchewan Among the Best Jurisdictions in the World For Investment ▪ Stable government and attractive fiscal terms ▪ Strong industry fundamentals for jobs, exports, economic growth and prosperity ▪ Government and provincial stakeholder groups extre
Slide 11: Environmental, Social & Governance Priorities
ENVIRONMENTAL, SOCIAL & GOVERNANCE PRIORITIES E S G ▪ Follow industry best practices to ▪ Strong relationships with our ▪ Introduced new employee minimize adverse effects to the community and stakeholders handbook in 2021 environment ▪ Assisting women to enter industry • Outlines the expected ▪ Comm
Slide 12: Operations Summary
OPERATIONS SUMMARY TSXV: SOIL I FSE: SMKA 12 12
Slide 13: Oxbow Asset – Southeast Saskatchewan
OXBOW ASSET – SOUTHEAST SASKATCHEWAN Oxbow North Operating Area – Recent Drilling Activity Spearfish/Frob-Alida/Tiston Reservoir Parameters Manor Queensdale Fertile-Antler Whitecap - Tilston Whitecap - Frobisher 101/13-25-007-31W1 T9 Parameter Units Spearfish Frob-Alida Tiston 101/05-12-006-06W2 IP
Slide 14: Oxbow Asset – Southeast Saskatchewan
OXBOW ASSET – SOUTHEAST SASKATCHEWAN Oxbow South Operating Area – Recent Drilling Activity Midale/Frobisher Reservoir Parameters Whitecap - Frobisher 101/13-17-004-01W2 IP 90 Oil: 109 bbl/d Adonai- Frobisher T5 Parameter Units Midale Frobisher RR: February 2020 101/06-08-003-33W1/00 IP 90 Oil: 156 b
Slide 15: Oxbow Asset – Southeast Saskatchewan
OXBOW ASSET – SOUTHEAST SASKATCHEWAN Frobisher Type Curve and Economics Midale Type Curve and Economics Top Quartile of Saturn Inventory – EUR 105 mbbl1 Top Quartile of Saturn Inventory – EUR 101 mbbl1 Industry Average – EUR 60 mbbl1 Industry Average – EUR 55 mbbl1 Frobisher Frobisher Midale Midale
Slide 16: Viking Asset – 59.5 Sections (Net)
VIKING ASSET – 59.5 SECTIONS (NET) Sustained Production Rates Provides Repeatable Development Opportunities Viking Light Oil Asset Base in West-Central Saskatchewan Saturn’s ERH Viking Type Curve1 140 T34 SATURN CORPORATE AVERAGE T33 120 Tier 2 - 20 Mbbls EUR Tier 4 - 32.5 Mbbls EUR T32 100 Tier 6 -
Slide 17: Viking Asset – West-Central Saskatchewan
VIKING ASSET – WEST-CENTRAL SASKATCHEWAN High Netbacks With Modest Capex Generate Significant Cash Flow Parameter Units Viking Vertical Depth meters 700-750 Net Pay meters 4.5 Avg. Porosity % 20 Permeability mD 0.1 – 1.0 Est. Water Sat. % 20 OOIP per Section mmbbl 6.5 Oil Quality API 37 Viking Satur
Slide 18: Saturn Three Year Plan
SATURN THREE YEAR PLAN Flexible Capital Budget - Highly Scalable to Rise in Oil Prices Capital Maintenance Drilling Growth Program Workover 400 suspended wellbores over the next three years Development Drilling ▪ $5M annual maintenance budget replaces decline and increases ▪ 370 total booked drillin
Slide 19: Management
MANAGEMENT The Right Team To Translate Vision Into Reality • Former CFO and founding partner of Axiom Group John Jeffrey • Strong background in operations and finance with successful track record executing large international engineering and environmental Chief Executive projects Officer • MBA major
Slide 20: Directors
DIRECTORS Strong Governance Combined With Operational Expertise • For 40 years, worked in the communications tower construction and ownership industry, in field construction, design engineering and management Calvin J. Payne • Former Co-founder and CEO of WesTower Communications, which was founded i
Slide 21: Saturn: The Complete Picture
SATURN: THE COMPLETE PICTURE Prioritizing the Generation of Responsible Growth and Sustainable Free Cash Flow, Supported by Prudent Fiscal Management and Long-term Drilling Inventory Continued Acquisition of Quality Assets Strategic Fiscal Management ▪ The acquisition and development of ▪ Prudent ba
Slide 22: Saturn's Mission Statement
Saturn’s Mission Statement “Saturn aims to lead the oil industry in both executional excellence and corporate stewardship. Our focus will remain to maximize shareholder value in the context of Saturn being at the forefront of what it means to be a Corporate Citizen.” John Jeffrey, CEO
Slide 23: Contact Us
CONTACT US Kevin Smith Corporate Headquarters VP Corporate Development Suite 1000 - 207 9 Ave SW +1 (587) 392-7900 Calgary, Alberta, T2P 1K3 info@saturnoil.com Canada Website www.saturnoil.com TSXV: SOIL I FSE: SMKA 23 23
Slide 24: Appendix
APPENDIX TSXV: SOIL I FSE: SMKA 24 24
Slide 25: Marketing & Risk Management
MARKETING & RISK MANAGEMENT Locked-in Economics Provides Security for Debt Repayment Hedging Summary as of July 1, 2021 WTI Hedged as Volume Period Derivative Reference Price % of Production: 2,585 bbl/d Jul – Dec 2021 Swap WTI US$63.78 ▪ H2 2021: ~ 79% 2,511 bbl/d Jul – Dec 2021 Collar WTI US$60.00
Slide 26: Disclaimer - Cautionary Statements
DISCLAIMER - CAUTIONARY STATEMENTS This presentation is for informational purposes only and is not intended as a solicitation or offering of securities of Saturn Oil & Gas Inc. (“Saturn” or the Company") in any jurisdiction. The material presented is not intended to modify, qualify, supplement or am
Slide 27: Disclaimer - Oil and Gas Advisories
DISCLAIMER - OIL AND GAS ADVISORIES Information Regarding Disclosure on Oil and Gas Operational Information and Non-IFRS Measures This presentation contains metrics commonly used in the oil and natural gas industry, such as “Netback”, “Operating Netback“, “Incremental Netback”, “Run Rate Debt Adjust
Slide 28: Disclaimer - Oil and Gas Advisories
DISCLAIMER - OIL AND GAS ADVISORIES Type Curve (continued) - “Frobisher Industry Average” and “Midale Industry Average” type wells are based on third party reserves evaluator expectations of the Oxbow asset as expectations of average production for booked locations based on industry wide past result
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