Baytex Energy Corp. · TSX:BTE
Baytex Energy — Investor Presentation (April 2020)
36 slides from Baytex Energy's investor presentation, April 2020
Slide 1: Investor Presentation April 2020
Investor Presentation April 2020
Slide 2: Advisory: Forward Looking Statements
Advisory Forward Looking Statements Any “financial outlook” or “future oriented financial information” in this presentation as defined by applicable securities laws, has been approved by management of Baytex. Such financial outlook or future oriented financial information is provided for the purpose
Slide 3: Advisory (Cont.)
Advisory (Cont.) Actual results achieved will vary from the information provided herein as a result of numerous known and unknown risks and uncertainties and other factors. Such factors include, but are not limited to: the volatility of oil and natural gas prices and price differentials (including t
Slide 4: Advisory Regarding Oil and Gas Information
Advisory (Cont.) Advisory Regarding Oil and Gas Information The reserves information contained in this presentation has been prepared in accordance with National Instrument 51-101 -Standards of Disclosure for Oil and Gas Activities of the Canadian Securities Administrators ("NI 51-101"). The determi
Slide 5: Investment Highlights
Investment Highlights High Quality and ▪ ~ 10 or more years of projected drilling inventory in each of our Diversified Oil Portfolio core areas (Viking, Eagle Ford and Canadian heavy oil) Across Multiple Plays ▪ Strong capital efficiencies and flexibility on discretionary capital Track Record of ▪ E
Slide 6: Corporate Profile
Corporate Profile Market Summary Ticker Symbol TSX / NYSE: BTE Average Daily Volume (1) CAN: 15.4 million / US: 2.6 million Shares Outstanding (2) 558 million Market Capitalization / Enterprise Value (2) $187 million / $2,074 million Operating Statistics Production (Gross W.I.) (3) 85,000 - 89,000 b
Slide 7: ESG Highlights
ESG Highlights GHG Emission Reduction Safety Established target to 55% reduction in lost reduce GHG emissions time incident frequency intensity by 30% by 2021 in 5 years Gas Conservation Indigenous Relations 99.1% routine gas $32 million in contracts conservation in Peace awarded in 2017-2018 River
Slide 8: 2019 Highlights
2019 Highlights ▪ Exploration and development expenditures of $552 million, Delivered on our which is the low end of original guidance Operating Plan ▪ Generated production of 97,680 boe/d, exceeding the high end of original guidance ▪ Free cash flow of $329 million generated in 2019 Generated Free
Slide 9: 2020 Outlook
2020 Outlook Revised capital program 2020 Guidance (1) designed to preserve financial liquidity E&D CapEx $260 - 290 million Production 85,000 - 89,000 boe/d • 50% reduction in capital spending Oil and NGLs 83% announced on March 18 Operating Area Net Wells CapEx ($MM) (2) • Drilling operations in C
Slide 10: Balance Sheet and Liquidity
Balance Sheet and Liquidity Balance Sheet (1) $ millions • Strong financial liquidity Bank loan (2) $692 • Credit facilities ~ one-third Long-term notes (3) $1,167 undrawn Long-term debt $1,859 • ~ $300 million of liquidity Working Capital deficiency $28 Net Debt $1,887 • Enhanced maturity profile w
Slide 11: Crude Oil Hedge Portfolio
Crude Oil Hedge Portfolio Q1/2020 Q2/2020 Q3/2020 Q4/2020 2020 WTI Fixed Hedges Volumes (bbl/d) 8,000 2,000 2,000 2,000 3,500 Fixed Price (US$/bbl) $56.95 $58.00 $58.00 $58.00 $57.40 WTI 3-Way Option Volumes (bbl/d) 24,500 24,500 24,500 24,500 24,500 Average Sold Put / Put / Sold Call (US$/bbl) (1)
Slide 12: 2020E Adjusted Funds Flow Sensitivities
2020E Adjusted Funds Flow Sensitivities Estimated Effect on Annual Adjusted Funds Flow ($MM) (1) Sensitivities Excluding Hedges Including Hedges (2) Change of US$1.00/bbl WTI crude oil $27.3 $26.0 Change of US$1.00/bbl WCS heavy oil differential $11.2 $8.1 Change of US$1.00/bbl MSW light oil differe
Slide 13: Diversified Crude Oil Marketing Portfolio
Diversified Crude Oil Marketing Portfolio Viking Light Oil Crude Oil and NGL Sales Portfolio (1) • 36° API light oil contributes to top quartile field netbacks • Priced off Canadian Mixed Sweet NGLs 11% (“MSW”) blend WTI / MSW 27% Crude by Rail 16% LLS / Brent Exposure • Eagle Ford is proximal to Gu
Slide 14: Top Quartile Capital Efficiencies
Top Quartile Capital Efficiencies $45,000 $40,000 2018 All-In Capital Efficiencies, excl. A&D ($/boe/d) Weighted Average ($/boe/d) Oil $25,000 $35,000 Gas $12,800 $30,000 Mixed $21,600 All $19,500 $25,000 $20,000 $15,000 $10,000 $5,000 $0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 BTE 22 23
Slide 15: Asset Overview
= SSS a me cy BAYTEX ENERGY CORP.
Slide 16: Asset Highlights
Asset Highlights Geographic and play diversification with ~ 10 or more years drilling inventory in each core area Eagle Ford Viking Heavy Oil East Duvernay Production 39,055 boe/d 22,546 boe/d 29,377 boe/d 1,688 boe/d (Gross; FY 2019) Oil and NGLs 77% 92% 91% 84% (Gross; FY 2019) 2P Reserves (1) 229
Slide 17: Eagle Ford: Core of Karnes County
Eagle Ford: Core of Karnes County • 19,900 net acres in the core of the Eagle Ford shale in south Texas Wilson • Four AMI’s (Longhorn, Sugarloaf, Ipanema and Excelsior) with average 25% W.I. Karnes • 2019 production of 39,100 LONGHORN boe/d (77% liquids) Atascosa • Achieved record production rates f
Slide 18: Eagle Ford: Strong Free Cash Flow and Deep Drilling Inventory
Eagle Ford: Strong Free Cash Flow and Deep Drilling Inventory Production Asset Level Free Cash Drilling Inventory (2) (mboe/d) Flow (1) (C$ millions) (net locations) Stable production and ~ $703MM cumulative free > 10 year inventory at deep inventory drives free cash flow since 2016 current pace cas
Slide 19: Enhanced Completions Drive Step Change in Well Performance
Enhanced Completions Drive Step Change in Well Performance 180 Day Cumulative Well Production Completion Activity 175 Stage Hz Length Proppant # of 17% increase 2019 over 2017 2019 Spacing (ft) (lbs/ft) Stages 150 5% increase 2019 over 2018 2018 (ft) 2019 6,300 2,300 225 28 Cumulative Production (mb
Slide 20: Viking Light Oil: Highly Prospective Sections
Viking Light Oil: 460 Highly Prospective Sections • Shallow (700 m), light oil (36° API) resource play with strong netbacks • Produced 22,500 boe/d (92% oil) in 2019 • Added 229 net unbooked drilling opportunities in 2019 through multiple Kerrobert deals and asset swaps Plenty Esther/Hoosier Greater
Slide 21: Technical Advancements Drive Productivity Improvement
Technical Advancements Drive Productivity Improvement Shift to ERH(1) Wells Drives Productivity 95%+ of Viking Development now Improvements ERH Wells 400 100% Viking Wells by Vintage 350 90% 80 80% 300 70% 70 250 60% 60 200 50% 40% Oil Rate (bbl/d) 150 50 30% 100 40 20% 50 10% 30 0 0% 2012 2013 2014
Slide 22: Peace River: Driving Production Growth and Cost Reductions
Peace River: Driving Production Growth and Cost Reductions North Seal Development • 2018/2019 program (10 multi- lateral horizontal wells) generated 30-day IP rates of ~ 700 boe/d per well Harmon Valley Performance Drivers Seal • Produced 16,800 boe/d in 2019 (86% oil) • Dominant 738 net sections •
Slide 23: Lloydminster: Significant Land Position and Drilling Inventory
Lloydminster: Significant Land Position and Drilling Inventory Performance Drivers • Produced 12,600 boe/d in 2019 (98% oil) Ardmore/Cold Lake • Strong capital efficiencies • Applying multi-lateral horizontal drilling and Lindbergh production techniques Lloydminster Tangleflags • Ramp-up of Kerrober
Slide 24: Heavy Oil Innovation
Heavy Oil Innovation Lloydminster Peace River Horizontal Multi-Lateral Horizontal 24
Slide 25: East Duvernay Shale Light Oil: Emerging Resource Play
East Duvernay Shale Light Oil: Emerging Resource Play Pembina Region • 275 sections of 100% WI lands • Seven wells drilled to date have delineated a minimum of 100- 125 sections • Produced 1,700 boe/d (84% liquids) in 2019 • Two wells on-stream in 2019 generated average 30-day IP Pembina rate of ~ 1
Slide 26: High Quality Oil Development
High Quality Oil Development Eagle Ford Viking Peace River (1) Lloydminster (1) East Duvernay Formation Lower Eagle Ford Viking Bluesky Mannville Group Duvernay Upper Eagle Ford Austin Chalk Depth (metres) 3,300-3,900 700 600 350-800 2,200-2,400 Oil API Oil: 40-45° 36° 11° 10-16° 42-44° Condensate:
Slide 27: Corporate Sustainability
Corporate Sustainability
Slide 28: Corporate Sustainability
Corporate Sustainability At Baytex, we believe that commitment to corporate responsibility is just as important as delivering financial and operational targets. We publish a biennial Corporate Sustainability Report which provides transparent reporting and clear goals on the topics that matter: Safet
Slide 29: GHG Emissions Reduction
GHG Emissions Reduction Target to reduce GHG emission intensity (tonnes of CO2 per boe) by 30% by 2021. Our emissions reduction strategy includes: • Increasing gas conservation • Reusing associated gas as fuel for field activities • Reducing emissions from storage tanks • Monitoring and preventing f
Slide 30: A Culture of Commitment
A Culture of Commitment How it contributes to Objective What we’ve done Result value creation Ensure our employees and 76% reduction in corporate spill ENVIRONMENT Reduces costs and maintains Responsibly develop contractors uphold our procedures volumes, over 5 years social license our assets for sp
Slide 31: Supplementary Information
Supplementary Information BAYTEX ENERGY CORP.
Slide 32: Summary of Operating and Financial Metrics
Summary of Operating and Financial Metrics Q1 2018 Q2 2018 Q3 2018 Q4 2018 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 2019 Benchmark Prices WTI crude oil (US$/bbl) $62.87 $67.88 $69.50 $58.81 $64.77 $54.90 $59.81 $56.45 $56.96 $57.03 NYMEX natural gas (US$/mcf) $3.00 $2.80 $2.90 $3.64 $3.09 $3.15 $2.64 $2
Slide 33: Reserves Summary (Gross)
Reserves Summary (Gross) 2P Reserves Breakdown 2P Reserves by Asset 2P Reserves by Commodity East Other Duvernay Natural Gas PDP Heavy Eagle Probable Ford Oil Light Oil Heavy + NGL Oil PDNP + PUD Viking Category (1) Eagle Ford Viking Heavy Oil East Duvernay Other Total Proved Developed Producing 71
Slide 34: 2020 Guidance and Cost Assumptions
2020 Guidance and Cost Assumptions Exploration and development expenditures ($ millions) $260 - $290 Production (boe/d) 85,000 - 89,000 Expenses: Royalty rate (%) 19.0% - 19.5% Operating ($/boe) $11.75 - $12.50 Transportation ($/boe) $1.10 - $1.20 General and administrative ($ millions) $45 ($1.42/b
Slide 35: Notes
Notes BAYTEX ENERGY CORP. TSX | Nyse 35
Slide 36: Contact Information
Contact Information Baytex Energy Corp. Edward D. LaFehr President and Chief Executive Officer Suite 2800, Centennial Place 587.952.3000 520 – 3rd Avenue S.W. Calgary, Alberta T2P 0R3 Rodney D. Gray T 587.952.3000 Executive Vice President and Chief Financial Officer Toll Free 1.800.524.5521 587.952.