Athabasca Oil Corporation · TSX:ATH
Athabasca Oil — Corporate Update (January 2015)
27 slides from Athabasca Oil's corporate update, January 2015
Slide 1: Athabasca Oil Corporation January 2015 Corporate Update
ATHABASCA OIL CORPORATION FOCUSED | EXECUTING | DELIVERING JANUARY 2015 CORPORATE UPDATE
Slide 2: Forward Looking Statement
1 FORWARD LOOKING STATEMENT This presentation contains forward-looking information that involves various risks, uncertainties and other factors. All information other than statements of historical fact is forward-looking information. The use of any of the words “anticipate,” “plan,” “continue,” “est
Slide 3: Refined Strategy for Value Creation
2 REFINED STRATEGY FOR VALUE CREATION Material Core Assets o 1,000+ well inventory in the Duvernay shale play at Kaybob o 80,000 bbl/d project potential at the Hangingstone thermal asset WORLD CLASS ASSETS Diverse portfolio provides long term optionality o Montney exposure at Placid o 9 billion bbl
Slide 4: Corporate Overview
3 CORPORATE OVERVIEW CAPITALIZATION OVERVIEW (Q3 2014) Stock exchange listing TSX Trading symbol ATH Share Price (January 7th, 2015) $2.25 $/sh 52-week trading range $2.02 - $8.84 $/sh Basic shares outstanding 402.0 MM Fully diluted shares 426.0 MM Insider ownership 4.1 % Market capitalization $905
Slide 5: Well Positioned for Growth
4 WELL POSITIONED FOR GROWTH 2015 HIGHLIGHTS o Building a business that is self funded in the medium-term o Exit volumes expected to grow by >75% in 2015 o Conservative approach to capital allocation and spending CAPEX/ FUNDING IN PLACE* PRODUCTION (boe/d) $1,400 Thermal Oil Capex ~$1.3bln 14,000 Ga
Slide 6: Focused on Our Core Assets
5 FOCUSED ON OUR CORE ASSETS LIGHT OIL: GREATER KAYBOB 2014/15 winter program o $167 million initial 2015 budget1 o 11 Duvernay and 2 Montney wells Go forward flexibility Hangingstone o Near-term Duvernay land retention requirements met by the spring o Ownership and operatorship in strategic regiona
Slide 7: Duvernay Overview
DUVERNAY OVERVIEW
Slide 8: The Duvernay Is a World Class Resource
7 THE DUVERNAY IS A WORLD CLASS RESOURCE SELECT UNCONVENTIONAL PLAYS IN o Large in place resource NORTH AMERICA WORLD o High liquids yield: 100 -1,000 bbl/MMcf liquids CLASS o Initial results compare favorably to the Eagle Ford RESOURCE o Major E&Ps active in the play o Proactive fiscal and regulato
Slide 9: Material Exposure Across the Kaybob Duvernay Fairway
MATERIAL EXPOSURE ACROSS THE KAYBOB 8 DUVERNAY FAIRWAY Volatile Oil Sections: >150,000 acres Locations: 1,300+ 2 2 Condensate Rich Gas Sections: >35,000 acres Locations: 200+ AOC Duvernay Land AOC 2014/15 Winter Program (11) AOC Drilled Duvernay (9)
Slide 10: Kaybob Duvernay Activity Update
9 KAYBOB DUVERNAY ACTIVITY UPDATE 4-29 S/C/Hz. On stream: June 16, 2014 30 day IP (restricted) – 615 boe/d CTD – 47 mboe, 71% liquids 8-29 Hz. On stream: June 21, 2014 30 day IP (restricted) – 784 boe/d CTD – 67 mboe, 77% liquids 13-23 Vert./C 16-36 S/C/Hz. Completion: Q4 2014 2 8-18 S/Hz. Planned o
Slide 11: Liquids and Overpressure Drives Economics
LIQUIDS AND OVERPRESSURE DRIVES 10 ECONOMICS o Industry drilling has confirmed the overpressured nature of the basin o High quality product (API low 40s to mid 50s) o Material exposure across all thermal maturity windows Pressure (1,000 psi) 0 5 10 15 AOC 0 Industry 2 5 Depth (1,000 ft) 08-18 2 4-32
Slide 12: Condensate Rich Gas
11 CONDENSATE RICH GAS KAYBOB WEST SAXON SOUTH Capital (Cur./Dev.) $MM $17/$10 $15/$8 Restricted IP30 boe/d 1,000 - 1,400 700 - 1,400 1 Initial Liquids Yields bbl/MMcf 50 - 400 50 - 400 EUR mboe 700 - 1000 600 - 900 Regional Players ECA, CVX, APA ECA, CVX, RDSA, TET 2 Royalties Eligible for shale ga
Slide 13: Value from Condensate Rich Gas and Volatile Oil
VALUE FROM CONDENSATE RICH GAS AND 12 VOLATILE OIL 2-34-62-20W5 WELL ECONOMICS WELL NPV SENSITIVITY TO LIQUIDS YIELDS1 Current Development 15 8-29-064-20W5 Capital $MM $15.0 $10.0 12 NPV 10% ($MM) IP30 boe/d 1,350 1,350 2-34-62-20W5 EUR mboe 970 970 9 01-07-64-20W5 ROR % 42% 96% 6 NPV 10 $MM $10.3 $
Slide 14: Unlocking the Volatile Oil Window
13 UNLOCKING THE VOLATILE OIL WINDOW WHAT WE KNOW VOLATILE OIL WINDOW o Encouraged by initial success from AOC and others Capital (Cur./Dev.) $MM $12 - $17 / $7 - $12 (restricted IPs >300 bbl/d, over-pressured, high quality Restricted IP30 boe/d 400 - 800+ product) 1 Initial Liquids Yields bbl/MMcf
Slide 15: Control of Strategic Infrastructure
14 CONTROL OF STRATEGIC INFRASTRUCTURE Total Battery Capacity Gas Pipeline Oil Capacity 36,000 bbl/d Up to Gas Capacity 84 MMcf/d, 180 MMcf/d Gas Capacity expandable to >130 MMcf/d Kaybob East AOC 91 km Pipeline Fort McMurray Kaybob West Saxon Keyera Simonette SemCAMS KA Placid EDMONTON o Operatorsh
Slide 16: Duvernay Growth Scenario
15 DUVERNAY GROWTH SCENARIO SCENARIO OVERVIEW PROJECTED DAILY PRODUCTION o Potential for significant annual production growth 70,000 Oil (bbl/d) 6 Condensate o Cost learnings with the transition to development 60,000 NGL's 5 Production (boe/d) Gas o Self funding in the mid-term1 50,000 Rig Count 4 R
Slide 17: Montney Appraisal at Placid
16 MONTNEY APPRAISAL AT PLACID PLACID MONTNEY WELL ECONOMICS1 o 2 well winter appraisal program aimed at Current Development demonstrating well performance similar to offsetting Capital $MM $12.2 $8.1 operators IP30 boe/d 1,520 1,520 o 100+ potential inventory (2 separate Montney cycles) EUR mboe 71
Slide 18: Hangingstone Overview
HANGINGSTONE OVERVIEW
Slide 19: Hangingstone Development
18 HANGINGSTONE DEVELOPMENT HANGINGSTONE PROJECT 1 (12,000 BBL/D) Fort McMurray o $63 million forecasted remaining spend in 2015 o Targeting first steam at the end of Q1 2015 o $708 million project capital – on time/budget o US$55/bbl cash flow break-even CPF WHAT HS1 MEANS FOR ATHABASCA o Stable pr
Slide 20: AOC Learnings Lead to Success
19 AOC LEARNINGS LEAD TO SUCCESS POTENTIAL LEARNINGS APPLIED ~ 5m of separation as per design ISSUE Drilled more delineation wells than industry KNOW THE average RESERVOIR High definition 3D Seismic Engineering and construction best practices ENGINEERING Drilling path and separation survey (on budge
Slide 21: Supplemental Information
SUPPLEMENTAL INFORMATION
Slide 22: Activity Levels Remain Robust
21 ACTIVITY LEVELS REMAIN ROBUST INDUSTRY TRANSITIONING TO DEVELOPMENT PLAY DEVELOPMENT o Majors are accelerating activity from the appraisal to development stage Eagle Ford Play Maturity / Valuation o 6 - 8 multi-well pads (Apache, Chevron, Encana, Shell); companies remain active o $1.5 billion Che
Slide 23: Debt and Credit Facility Overview
22 DEBT AND CREDIT FACILITY OVERVIEW UNDRAWN CREDIT FACILITIES Q3 2014 INTEREST RATE PRE-PAYMENT TERMS Cdn $125 million senior secured revolving credit facility due 2017 $125 ~ 5% Pre-payable without penalty 05/2015 – 102% US $50 million senior secured term loan LIBOR + 7.25% 05/2016 – 101% delayed
Slide 24: Other Long Term Assets
23 OTHER LONG TERM ASSETS GROSMONT o 418 MMbbl contingent resource1 (best estimate, AOC interest) Slave Point BIRCH SLAVE POINT o > 675,000 acre land position o 2.1 Bbbl contingent resource1 (best estimate) o Validated oil production with 2013 pilot program Birch Grosmont Dover DOVER WEST SANDS West
Slide 25: Management Team and Board
24 MANAGEMENT TEAM AND BOARD MANAGEMENT TEAM BOARD OF DIRECTORS Thomas Buchanan, FCA Thomas Buchanan, FCA Chief Executive Officer Chairman & Chief Executive Officer o Over 30 years experience in the oil and natural gas sector, and currently Chairman of Spyglass Resources Corp. Ronald Eckhardt o Form
Slide 26: Endnotes
25 ENDNOTES Slide Endnotes 2 (1) Best estimate contingent resource adjusted for the Dover disposition (2) Estimated funding in place as of December 31, 2014; includes cash and cash equivalents, available credit facility and promissory notes (3) Corporate production guidance based on a $167 million i
Slide 27: Corporate Office
Corporate Office 1200, 215 - 9 Ave SW, Calgary, Alberta Telephone: 403-237-8227 Fax: 403-264-4640 www.atha.com