International Petroleum Corp. (british Columbia) · OMXSTO:IPCO
International Petroleum Corp. (british Columbia) — International Petroleum — Q3 2021 Earnings Presentation
41 slides from International Petroleum Corp. (british Columbia)'s earnings presentation, Nov 2, 2021
Slide 1: Operations & Financial Update Third Quarter 2021
Operations & Financial Update Third Quarter 2021 Q 3 Mike Nicholson, CEO Christophe Nerguararian, CFO November 2, 2021 21 NC00223 p01 10.21
Slide 2: Q3 2021 Highlights
International Petroleum Corp. Q3 2021 Highlights Q3 average net production of 46,800 boepd, above high end guidance Production Guidance (1) Revising full year guidance upward to >45,000 boepd (previously >44,000 boepd) Q3 below guidance at 14.7 USD/boe Operating costs (2) Full year forecast retained
Slide 3: 2021 Production
International Petroleum Corp. 2021 Production Q3 2021 production of ~46,800 boepd (1) IPC Production Onion Lake Thermal Bertam Field 100% WI Onion Lake Thermal Pad D’ first oil planned maintenance at Bertam Field planned maintenance 50 Canada Exceptional production performance across all assets Onio
Slide 4: 2021 Production Guidance
International Petroleum Corp. 2021 Production Guidance (1) 2021 Production Guidance International Malaysia 9.5% 16% France 2021 Production guidance raised to >45,000 boepd 6.5% Canada Gas (previously > 44,000 boepd) 37% Suffield Canada Other 5% Gas Ferguson 3 quarters in succession above original hi
Slide 5: 2021 Operating Cash Flow
International Petroleum Corp. 2021 Operating Cash Flow (1) 335 MUSD 85 USD/bbl (3/12) 315 MUSD 75 USD/bbl (3/12) 226 MUSD 220 MUSD 68 USD/bbl 65 USD/bbl (3/12.5) (4/17) 165 MUSD 55 USD/bbl (3/15) 107 MUSD 45 USD/bbl (2/13) CMD OCF 9 months Full year revised NC00223 p05 10.21 guidance OCF guidance (1
Slide 6: 2021 Capital Expenditure
International Petroleum Corp. 2021 Capital Expenditure (1) Reducing 2021 capital expenditure by 23 MUSD to 50 MUSD Rephased to 2022 Bertam Field drilling rephased into Q1 2022 73 MUSD 23 MUSD 50 MUSD Q2 Capital Full year NC00223 p06 10.21 Capex adjustment revised Capex guidance guidance (1) See Read
Slide 7: 2021 Free Cash Flow
International Petroleum Corp. 2021 Free Cash Flow (1) 260 MUSD 85 USD/bbl (3/12) 30% yield (2) 240 MUSD 75 USD/bbl (3/12) 28% yield (2) 176 MUSD 68 USD/bbl 155 MUSD (3/12.5) 65 USD/bbl (4/17) 100 MUSD 55 USD/bbl (3/15) 39 MUSD 45 USD/bbl (2/13) CMD FCF 9 months Full year revised NC00223 p07 10.21 gu
Slide 8: FCF Yield
International Petroleum Corp. FCF Yield Global Integrated & E&P Industry Average FCF Yields % - 2021 30% 30% 260 MUSD 28% 240 MUSD 25% 20% 16% 15% 12% 10% 8% 5% 0% NA Senior NA Euro NA Canada USA IPC Average All North Sea Colombia EP Integrated Majors Intermediate Royalty Royalty EP NC00223 p10 10.2
Slide 9: Strongly Positioned to Create Shareholder Value
International Petroleum Corp. Strongly Positioned to Create Shareholder Value 2021-2025 85% Stakeholder Returns 55 USD (3) 17% p.a. (4) Debt reduction, share buybacks & dividends >740 MUSD FCF (1,2,3) M&A ~45 Mboepd (1) 4 transactions in less than 4 years 75 138% USD (3) 28% p.a. (4) Organic Growth
Slide 10: Net Asset Value (MUSD)
International Petroleum Corp. Net Asset Value (MUSD) (1) 2,410 2,378 1,630 34% discount 321 1,309 to NAV 72.5 SEK (3) 868 48 SEK 543 2017 2020 2021 2021 Net Debt (1) NAV (1) IPCO YE 2019 YE 2020 Market Cap (2) PRICE PRICE NC00223 p09 10.21 (1) As at December 31, 2020, see AIF. (2) Based on IPC share
Slide 11: Share Repurchase
18 12 NLA NLA International Petroleum Corp. 16 Share Repurchase Blackrod R19 NLA R18 NLA NLA Two share repurchase programs executed since 2017 launch 34 million shares acquired and cancelled <33 SEK/share on average New repurchase program approved(1)(2) Production ~5% above original high end guidanc
Slide 12: IPC Canada Suffield Oil
IPC Canada 1,800 N2N Production Performance Suffield Oil (1) 1,500 Production (boepd) 1,200 900 Strong production performance 600 Production above early 2016 levels 300 0 N2N performance continues to outperform Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul S
Slide 13: Suffield Area Assets: Suffield Gas
Suffield Area Assets Suffield IPC Canada Suffield Gas (1) Strong Canadian gas prices Gas assets continue to generate strong cashflow CFB Suffield Alderson 0 KM 20 Offsetting natural declines with low cost optimisation activity IPC Licences Redcliff Operated / Shallow Gas Hydrocarbon fields/discoveri
Slide 14: Onion Lake Thermal
Onion Lake Thermal IPC Canada R1W4 R27W3 Onion Lake Thermal (1) D’ Pad Planned maintenance successfully completed in May D’ E L T56 A C T56 5 infill well drilling on track for Q4 completion B Wells drilled and to be completed and tied in F Pad D’ online ahead of schedule in Q3 F Pad Adds >1,500 bopd
Slide 15: IPC Canada Onion Lake Thermal
Athabasca IPC Canada Peace River Blackrod Cold Lake Onion Lake Thermal (1) Mooney Onion Lake Edmonton Calg ary Calgary Canada Regina Medecine Hat Suffield 5 infill well project sanctioned Facilities already in place Surface drilling locations from existing well pads Low risk project with excellent v
Slide 16: IPC Canada Ferguson
0 50 KM 200 Major Oil pipeline IPC Canada Major Gas pipeline 0 20 Miles 100 IPC asset Blackrod Ferguson (1) Mooney Saskatchewan Onion Lake Minimal activity set in 2021 Alberta Gas injection and repressurisation via cost British Columbia effective well conversions Calgary Office Potential to double p
Slide 17: IPC Canada Conventional
Major Oil pipeline Major Gas pipeline IPC Canada IPC asset Conventional (1) Mooney Conventional John Lake and Onion Lake Primary ramped up with improved WCS pricing John Lake Onion Lake Mooney Restarted in Q2 with improved WCS pricing Conventional and Mooney current production rates Alberta of ~1,80
Slide 18: IPC Canada Blackrod
IPC Canada Blackrod (1) Blackrod Athabasca Blackrod 4 Peace River Production results continue to exceed Mooney Cold Lake expectations Edmonton Onion Lake 4 asca River Calg ary Calgary Canada b Regina Successful WP3 means: a Medecine Hat Ath Suffield Improved overall project economics Less wells, pad
Slide 19: IPC Malaysia Operations Update
IPC Malaysia Operations Update (1) High facility uptime and strong base well performance Malaysia Planned maintenance shutdown complete Bertam Processing capacity increased from 17,000 to 24,000 barrels of water per day Bertam Field Production 14,000 Planned 12,000 maintenance turnaround 10,000 Phas
Slide 20: IPC Malaysia A15 Sidetrack
Bertam – North East Region IPC Malaysia A15 Sidetrack (1) A20 A15 Sidetrack well sanctioned Infill Potential Scheduled to commence drilling in Q4 First oil expected in early 2022 A15 sidetrack A15 Sidetrack Economics Reserves >1.5 MMbo Breakeven (Brent) <20 USD/bbl IRR (@ 55 USD/bbl (2)) Infill Camp
Slide 21: IPC Malaysia Pump Upsizing
IPC Malaysia Pump Upsizing (1) Well workovers execution ready To be completed post A15 sidetrack well using same drilling rig Malaysia – Bertam Incremental forecast production of ~800 bopd A20 Well Optimisation Economics Reserves 0.6 MMboe A15 sidetrack Breakeven (Brent) ~20 USD/bbl Bertam FPSO A09
Slide 22: IPC France Operations Update
IPC France VGR-113H Production Operations Update (1) 1,600 Actuals Investment Case 1,400 1,200 VGR5 conversion Production (bopd) 1,000 Strong production from all major producing fields 800 VGR113 continues to outperform 600 400 Original water breakthrough expected Q3 2020 200 No water breakthrough t
Slide 23: Sustainability & ESG
International Petroleum Corp. Offset Sustainability & ESG 100,000 t CO2 Carbon credits Annual publication of IPC’s Sustainability Report 35,000 t CO2 Materiality assessment concluded Severe injury 2020 report GRI compliant Zero Strategy to reduce net emissions intensity by 50% by 2025 (1) Employees
Slide 24: First Nine Months 2021 Financial Highlights
First Nine Months 2021 Financial Highlights 24
Slide 25: First Nine Months 2021 Financial Highlights
First Nine Months 2021 Financial Highlights Third Quarter First Nine Months 2021 2021 Production (boepd) 46,800 45,100 Average Dated Brent Oil Price (USD/boe) 73.5 67.9 Operating costs (USD/boe) (1) 14.7 14.9 Operating cash flow (MUSD) (1) 91.4 226.0 EBITDA (MUSD) (1) 89.2 220.7 Net result (MUSD) 30
Slide 26: Realised Oil Prices
First Nine Months 2021 Realised Oil Prices USD/bbl YTD Q3 2021 Q2 2021 Q1 2021 FY 2020 FY 2019 Brent 67.9 73.5 69.0 61.1 41.8 64.2 Malaysia 70.1 (+2.2) 73.4 (-0.1) 70.4 (+1.4) 64.8 (+3.7) 44.6 (+2.8) 69.9 (+5.7) France 68.5 (+0.6) 73.3 (-0.2) 69.6 (+0.6) 64.6 (+3.5) 35.8 (-6.0) 63.5 (-0.7) WTI 65.0
Slide 27: Realised Gas Prices
Third Quarter 2021 Realised Gas Prices YTD Q3 Q2 Q1 Full Year Full Year Henry Hub Price USD/MMbtu CAD/mcf 2021 2021 2021 2021 2020 2019 Realised Price CAD/Mcf AECO 3.29 3.60 3.09 3.13 2.23 1.80 Empress 3.53 4.24 3.09 3.20 2.22 2.49 Empress / AECO differential Realised 3.30 (-0.23) 3.72 (-0.52) 3.05
Slide 28: Financial Results – Operating Cash Flow & EBITDA
Third Quarter 2021 Financial Results – Operating Cash Flow & EBITDA (1) Operating Cash Flow EBITDA 240 240 220 226.0 220 220.7 200 200 180 180 160 160 140 140 Million USD Million USD 120 120 100 100 80 91.4 89.2 80 73.4 60 65.4 60 40 40 37.2 34.3 20 20 0 0 NC00223 fin p14 10.21 Q3 Q3 9M 9M Q3 Q3 9M
Slide 29: Operating Costs
First Nine Months 2021 Operating Costs (1) USD/boe operating costs USD/boe 20 20 18 OLT turnaround 18 16 16 2021 Operating Costs: 15.5 USD/boe guidance 14 14 12 12 10 10 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Actual Actual Actual Forecast Operating costs guidance for the year maintained at 15.5 USD/boe NC0
Slide 30: Netback (USD/boe)
First Nine Months 2021 Netback (1) (USD/boe) Third Quarter First Nine Months 2021 2021 Average Dated Brent oil price (73.5 USD/bbl) (67.9 USD/bbl) Revenue 40.1 36.7 Cost of operations -12.0 -12.1 Tariff and transportation -2.1 -2.2 Production taxes -0.6 -0.6 Operating costs (2) -14.7 -14.9 Cost of b
Slide 31: Cash Flows and Closing Net Debt
First Nine Months 2021 Cash Flows and Closing Net Debt (1) (MUSD) -60 -60 Operating Cash Flow Development capex -80 MUSD 226.0 MUSD -27.4 -80 Cash G&A -100 -100 MUSD -8.0 -120 -120 -140 Exploration & evaluation -140 MUSD 0.9 -160 Cash Financial items Closing Net Debt MUSD -12.3 30 Sep 2021 -180 Chan
Slide 32: G&A / Financial Items
First Nine Months 2021 G&A / Financial Items MUSD Third Quarter 2021 First Nine Months 2021 G&A 2.7 8.0 G&A – Depreciation 0.4 1.3 G&A Expense 3.1 9.3 Third Quarter 2021 First Nine Months 2021 Interest expense 2.7 11.0 Loan facility commitment fees 0.4 1.1 Amortisation of loan fees 0.5 1.6 Foreign e
Slide 33: First Nine Months 2021 Financial Results
First Nine Months 2021 Financial Results Revenue MUSD 451.1 500 45,100 boepd 500 Production costs Million USD 400 MUSD -222.5 400 Operating costs (1) 14.9 USD/boe Million USD 300 300 Cash Margin MUSD 228.6 200 Depletion 200 MUSD -96.2 Financial items MUSD -26.1 Gross profit 100 Exploration costs 100
Slide 34: Balance Sheet
30 September 2021 Balance Sheet MUSD 30 Sep 2021 31 Dec 2020 Assets Oil and gas properties 1,002.5 1,070.9 Other non-current assets 161.0 169.7 Current assets 143.7 92.5 1,307.2 1,333.1 Liabilities Financial liabilities 180.3 301.1 Provisions 217.1 197.0 Other non-current liabilities 23.7 29.4 Curre
Slide 35: Hedging – Status
30 September 2021 Hedging – Status Malaysian/French oil production (Brent linked) unhedged – Unchanged 2021 Canadian hedging in place – Unchanged Oil : 40% of Canadian 2H forecast oil production hedged (bank covenant met) – 5.0 Mbopd swap at WCS 44 USD/bbl Q4 21 hedges – 3.3 Mbopd collar at WCS 44-6
Slide 36: Q3 2021 Highlights
International Petroleum Corp. Q3 2021 Highlights Q3 average net production of 46,800 boepd, above high end guidance Production Guidance (1) Revising full year guidance upward to >45,000 boepd (previously >44,000 boepd) Q3 below guidance at 14.7 USD/boe Operating costs (2) Full year forecast retained
Slide 37: Reader Advisory
Reader Advisory Forward Looking Statements This presentation contains statements and information which constitute “forward-looking statements” or “forward-looking information” (within the meaning of applicable securities legislation). Such statements and information (together, “forward-looking state
Slide 38: Reader Advisory
Reader Advisory Although IPC believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because IPC can give no assurances that they will prove to be correct. Since forward- l
Slide 39: Reader Advisory
Reader Advisory Reserve estimates, contingent resource estimates and estimates of future net revenue in respect of IPC’s oil and gas assets in France and Malaysia are effective as of December 31, 2020, and are included in the report prepared by ERC Equipoise Ltd. (ERCE), an independent qualified res
Slide 40: Reader Advisory: Supplemental Information on Product Types
Reader Advisory Supplemental Information regarding Product Types The following table is intended to provide supplemental information about the product type composition of IPC’s net average daily production figures provided in this document: Heavy Crude Oil Light and Medium Crude Oil Conventional Nat
Slide 41: www.international-petroleum.com
www.international-petroleum.com Follow us on social media NC00223 p40 10.21 41
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