Vermilion Energy Inc. · TSX:VET
Vermilion Energy — Investor Presentation (May 2025)
43 slides from Vermilion Energy's investor presentation, May 2025
Slide 1: Vermilion Energy Investor Presentation
VERMILION ENERGY GLOBAL GAS PRODUCER FREE CASH FLOW FOCUSED INVESTOR PRESENTATION ESG EXPERTISE MAY 2025
Slide 2: Vermilion at a Glance
VERMILION AT A GLANCE Market Summary VET Trading Price (May 9, 2025) $8.94 (TSX), US$6.41 (NYSE) Shares Outstanding (Apr. 30, 2025) 154.5 MM Average Daily Trading Volume (shares) 0.8 MM (TSX), 1.2 MM (NYSE) Quarterly Dividend $0.13/share Capital Structure Market Capitalization $1.4 B Enterprise Valu
Slide 3: Global Gas Advantage
GLOBAL GAS ADVANTAGE Global gas producer with 30 years operating in Europe and North America Diversified portfolio delivers outsized FCF(1) through direct exposure to global commodity prices and enhanced capital allocation optionality Robust asset base combining low-decline conventional assets with
Slide 4: Key Updates
KEY UPDATES Deep Basin (+$0.65/share) • Closed Westbrick acquisition in Q1/25, adds 50,000 boe/d of production and 0.8 million net acres o Identified $100MM NPV10(1) of incremental synergies post-acquisition, anticipate further synergies Montney (+$0.35/share) • DCET costs reduced from $9.6 million
Slide 5: Growth Assets
GROWTH ASSETS a) Se SERS SS
Slide 6: Advancing Our Global Gas Strategy
ADVANCING OUR GLOBAL GAS STRATEGY Deep Basin • 4th largest Alberta Deep Basin producer • Incremental Westbrick synergies post-close ~$100MM (NPV10)(1) (15+ years of inventory) • Inventory to grow production to 80,000 boe/d, maintain for 15+ years Montney • Infrastructure expansion nearly complete •
Slide 7: Dominant Alberta Deep Basin Position
DOMINANT ALBERTA DEEP BASIN POSITION Prominent Deep Basin producer, over 1.1 million net acres of land with 15+ years of inventory Source: Land information sourced from XI Technologies Asset Book. 7
Slide 8: Robust Deep Basin Economics
ROBUST DEEP BASIN ECONOMICS Upper Cretaceous Upper Spirit Lower Cretaceous River Mannville Lateral Length (m) 2,800 2,900 2,800 DCET Cost ($MM) $5.0 – 5.5 $6.0 – 6.5 $5.5 – 7.5 Spirit River IP365 (boe/d)(1) 450 750 475 EUR (mboe)(2) 770 1,050 610 Liquids % of Reserves(3) 32% 14% 47% Lwr Mnvl/ Jurass
Slide 9: Westbrick Synergies
WESTBRICK SYNERGIES • Closed Westbrick acquisition in February 2025, integration progressing ahead of plan • Identified incremental ~$100 million (NPV10)(1) of operational and development synergies to date o Anticipate additional synergies may be identified and realized • Synergies include: o Extend
Slide 10: Premium Montney Acreage
PREMIUM MONTNEY ACREAGE VET owns ~22% of CEI.V* Oil Wet Gas Dry Gas A significant and contiguous premium acreage block in the oil window of the Montney Source: Land information sourced from XI Technologies Asset Book * Vermilion has ownership of, or control and direction over, approximately 22% of t
Slide 11: Montney Well Economics
MONTNEY WELL ECONOMICS BC Middle Montney Lateral Length (m) 3,000 DCET Cost ($MM) $9.0 IP365 (boe/d)(1) 950 EUR (mboe)(2) 1,500 Liquids % of Reserves(3) 38% IRR(4) 85% Payout (years) 1.2 NPV10 ($MM) $9.6 (1) Production rates presented above are for a limited timeframe only and may not be indicative
Slide 12: Montney Development
MONTNEY DEVELOPMENT • Long-term development plans target production base of 28,000 boe/d with majority of future development occurring in BC • Infrastructure largely in place 4-3 Battery 8-33 Battery o Constructed 16,000 boe/d 8-33 battery in Q2/24 o Phase two expansion in Q1/25 added compression an
Slide 13: Montney Cost Optimization
MONTNEY COST OPTIMIZATION BC MONTNEY AVERAGE WELL COST • DCET(1) cost reduced to $9.0MM (from $14 $9.6MM), line of sight to further cost improvements $12 o Improves project economics, represents ~$50 $10 million (NPV10)(2) in future development costs Per Well Cost ($MM) • 8-4 BC pad, completed in Q1
Slide 14: Germany Exploration Potential
GERMANY EXPLORATION POTENTIAL Identified 9 structures to date and Deep Gas Exploration have drilled 3, potential for up to Type Well (1.0 Net) 30 total locations with success Vertical Depth (m) ~5,000 DCET Cost ($MM) $40 – 50 EUR (Bcf)(1) ~30 Gas % of Reserves(2) 100% IRR(3) 40% Payout (years)(4) 1.
Slide 15: Germany 2024 Exploration Success
GERMANY 2024 EXPLORATION SUCCESS PRODUCTION FROM CURRENT DISCOVERIES 2024 Exploration Program Results 6,000 • Three prospects drilled to date: 5,000 o Osterheide (100% WI) - tested at 17 mmcf/d(1), currently on BOE/D ( NET)(4) 4,000 production o Wisselshorst (64% WI) – tested at 3,000 41 mmcf/d(1) f
Slide 16: Osterheide Production
OSTERHEIDE PRODUCTION • Osterheide well was brought on stream at the end of Q1/25 • Produced at restricted rate of ~1,200 boe/d(1) since startup o Above original constrained expectations • Expect production to moderate through the summer months, increase with winter demand (1) Refer to Vermilion’s Q
Slide 17: Wisselshorst Development Upside
WISSELSHORST DEVELOPMENT UPSIDE • Wisselshort is the largest structure Vermilion has discovered in Europe o Estimated to contain 380 Bcf gas in place (240 Bcf net)(1) Discovery well • Multi-year development plan with 2P reserves 68 Bcf (44 Bcf net)(2) up to 6 follow-up locations offsetting discovery
Slide 18: Capital Allocation
CAPITAL ALLOCATION 18 18
Slide 19: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES Provide Target long-term Maintain Strong Maintain Robust Compounding value-add acquisition Balance Sheet Asset Base Shareholder Returns opportunities Rolling 10+ year Sustainable base dividend Focus on increased Targeting net debt to FFO development plan supplemented by
Slide 20: Financial Liquidity
FINANCIAL LIQUIDITY HISTORICAL NET DEBT TO FFO CURRENT CREDIT CAPACITY(2) 4.0x 3.5x $575MM 3.0x Available Liquidity NET DEBT TO FFO RATIO(1) of $1,021MM 2.5x Committed to returning to 1.0x leverage $575MM 2.0x 1.5x $329MM $445MM 1.0x 0.5x Undrawn Capacity on Revolving Credit Facility 0.0x Revolving
Slide 21: FFO Generation
FFO GENERATION NET DEBT VS FFO(1) 125 – 130 $2,000 mboe/d 150 125 PRODUCTION (‘000 BOE/D) $1,500 100 $MM $1,000 75 50 $500 25 $0 0 2023 2024 2025e Net Debt to Trailing FFO 0.9x 0.8x 1.8x FFO ($/basic share) $ 6.98 $ 7.63 ~$ 6.80 Unhedged FFO ($/basic share) $ 6.05 $ 5.61 ~$ 6.20 WTI (US$/bbl) $77.63
Slide 22: Strong Hedge Position
STRONG HEDGE POSITION 2025 2026 PERCENTAGE OF PRODUCTION HEDGED (%)(1) PERCENTAGE OF PRODUCTION HEDGED (%)(1) 100% 100% 90% 90% 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% Crude Oil European N.A. Corporate Crude Oil European N.A. Corporate Natural Gas Natural Gas Total Natu
Slide 23: Compounding Return of Capital
COMPOUNDING RETURN OF CAPITAL ANNUAL DIVIDEND PER SHARE VS. SHARE COUNT $0.80 165 SHARES OUTSTANDING (MM) DIVIDENDS PER SHARE $0.60 160 $0.40 155 $0.20 150 $0.00 145 2022 2023 2024 2025e Annualized Dividend per Share Share Count Decreasing share count contributes to ratable dividend increases and va
Slide 24: Global Gas Producer Advantage
GLOBAL GAS PRODUCER ADVANTAGE 24
Slide 25: Advantages of Global Gas
ADVANTAGES OF GLOBAL GAS Q4 2024 PF REALIZED NATURAL GAS PRICE(1) $6 TOP DECILE REALIZED PRICES REALIZED NAT. GAS PRICE ($/MCF) $5 $4 DIRECT EXPOSURE TO PREMIUM PRICING $3 AVERAGE (EXCL VET) = $2.18 $2 OPPORTUNITY TO ACQUIRE EURO GAS ASSETS $1 $0 VET Peer Peer Peer Peer Peer Peer Peer Peer Peer Peer
Slide 26: International Operating Netbacks
INTERNATIONAL OPERATING NETBACKS VERMILION 2025E OPERATING NETBACK $100 $80 $60 $/ BOE* $40 $20 $0 Ireland Netherlands Croatia Australia Germany France (100% Gas) (99% Gas) (100% Gas) (100% Oil) (69% Gas) (100% Oil) International assets generate strong netbacks on premium pricing * Source: Based on
Slide 27: European Gas Price Advantage
EUROPEAN GAS PRICE ADVANTAGE HISTORICAL AND FORWARD PRICING OF EUROPEAN GAS $60 $50 Euro Gas 2025 2026 TTF GAS PRICES (C$/MMBTU) % Hedged 56% 51% $40 Average Floor $17 $14 $30 $20 $10 $0 2017 2018 2019 2020 2021 2022 2023 2024 2025e* 2026e* European natural gas prices trade at a significant premium
Slide 28: European Gas Fundamentals
EUROPEAN GAS FUNDAMENTALS EUROPEAN SUPPLY/DEMAND BALANCE HISTORY** 80 Winter 2023 demand down ~10 Bcf/d • Europe* consumes ~40 Bcf/d per annum, with ~30 Bcf/d due to 2nd warmest winter, government policy, and extremely high prices swing between summer and winter 60 40 BCF/D • Russian supply has decr
Slide 29: Canadian Gas Fundamentals
CANADIAN GAS FUNDAMENTALS West Coast Canadian LNG(1) North American Power Demand • Natural gas demand for Canadian LNG is expected to • Increased power associated with datacenter development increase notably by end of decade (>6.0 bcf/d) is underpinning long-term natural gas demand o Strong momentum
Slide 30: Gas Marketing Summary
GAS MARKETING SUMMARY GAS PRODUCTION BY REGION* NATURAL GAS PRICE EXPOSURE** Europe Europe 22% 22% AECO 32% Alliance 7% North America 78% N.A. Hedges 35% N.A. HEDGES ALLIANCE SASK/WYOMING EUROPE (TTF/THE/NBP) Global gas diversification balances gas exposure and improves netbacks * Based on company 2
Slide 31: North American Liquids-Rich Gas Advantage
NORTH AMERICAN LIQUIDS-RICH GAS ADVANTAGE REALIZED PRICING (DEEP BASIN + MONTNEY) $60 • Vermilion’s liquids-rich gas assets offer Over the past decade, Vermilion’s Deep Basin and Montney assets significantly higher realized price and $50 have realized pricing more than double the average AECO price
Slide 32: Asset Overview
ASSET OVERVIEW 32
Slide 33: Europe
EUROPE NETHERLANDS • #2 onshore gas producer IRELAND • ~700,000 net acres of undeveloped land • 56.5% operated interest in the Corrib Natural Gas Project • Q1 2025 production = 4,020 boe/d (99% gas) • Corrib represents 100% of Ireland’s domestic gas production GERMANY • Q1 2025 production = 8,820 bo
Slide 34: Australia
AUSTRALIA • 100% operated interest in Wandoo, an offshore oil field approximately 80 km N.W. off the coast of Australia (55m water depth) • Horizontal well development with 23 producing wellbores and five dual lateral sidetracks tied into two platforms • New wells drilled every 2-4 years • Q1 2025 p
Slide 35: North America
NORTH AMERICA CANADA MONTNEY • Q1 2025 production = 69,721 boe/d (38% liquids) SOUTHEAST SASKATCHEWAN • Targeting liquids-rich gas in the • Q1 2025 PF production = 104,236 boe/d (33% liquids) • Targeting light oil in conventional Peace River Arch straddling the reservoirs AB and BC border • ~275,000
Slide 36: ESG & Sustainability
ESG & SUSTAINABILITY 36
Slide 37: Environment, Social and Governance
ENVIRONMENT, SOCIAL AND GOVERNANCE EMISSIONS INTENSITY TREND Vermilion’s Purpose: 0.030 Scope 1&2 tCO2e per BOE To responsibly produce essential energy 0.025 while delivering long-term value to our people, shareholders, customers, partners 0.020 and communities 0.015 2019 2020 2021 2022 2023 • Reduc
Slide 38: Sustainability Projects
SUSTAINABILITY PROJECTS Advancing environmental projects in communities where we live and work PARENTIS SUSTAINABILITY PARTNERSHIP LA TESTE ECO-NEIGHBOURHOOD • Our oil operations provide 40 GWh of • Our oil operations provide 1.2 GWh of geothermal energy annually to a tomato geothermal energy to an
Slide 39: Summary
SUMMARY Global gas producer with 30 years operating in Europe and North America Diversified portfolio delivers outsized FCF(1) through direct exposure to global commodity prices and enhanced capital allocation optionality Robust asset base combining low-decline conventional assets with long-life gro
Slide 40: Appendix
APPENDIX 40
Slide 41: Pricing and FFO Sensitivity
PRICING AND FFO SENSITIVITY COMMODITY PRICES(1) 2025e 2025 ANNUAL FFO SENSITIVITY (C$MM)(2) FFO Impact FFO Impact Change Brent (US$/bbl) $65.71 (Hedged) (Unhedged) WTI (US$/bbl) $61.94 WTI & Brent US$1/bbl $10MM $17MM LSB = WTI less (US$/bbl) $ 4.85 LSB / WTI Diff. US$1/bbl $9MM $9MM MSW = WTI less
Slide 42: Updated Budget and Guidance
UPDATED BUDGET AND GUIDANCE CATEGORY 2025 GUIDANCE(1) 2025 DRILLING PROGRAM WELL COUNT Production (boe/d) 125,000 - 130,000 Germany 5 gross (5.0 net) E&D capital expenditures ($MM) $730 - 760 Netherlands 2 gross (1.2 net) Royalty rate (% of sales) 9 - 11% Croatia 1 gross (1.0 net) Operating ($/boe)
Slide 43: Advisory
ADVISORY This presentation is for information purposes only and is not intended to, and should not be construed to constitute, an offer to sell or production and reserves through exploration and development activities; the possibility that government policies or laws may change or the solicitation o