Jupiter Resources | 1 Jupiter Resources | 1 Corporate Presentation March 2020 The largest Canadian energy producer that nobody has heard of…
Jupiter DNA Jupiter Resources | 2 Striving to be one of Canada’s premier natural gas producers Returns Focused Technology Leader Set the bar higher Faster – efficiency boost returns Challenge the status quo Higher – lower costs drive profits Invest in innovation Stronger – reduced risk strengthens capital Invest In Progress – The Returns Are Worth It We are committed to providing strong returns through disciplined, focused investment of the shareholder capital entrusted to us. We measure our success by all-in cash-on-cash returns targeting corporate level returns in excess of 20%. 2
Why you should care Jupiter Resources | 3 • Canada’s 5 th largest gas-weighted producer • 2 nd largest Deep Basin pure play • Consistently drill some of Canada’s highest productivity gas wells • Scalable platform with deep inventory of low-risk resource • Targeting all-in corporate returns on capital investment > 20% JUPITER PROPERTIES WESTERN CANADA SEDIMENTARY BASIN DEEP BASIN FAIRWAY MAJOR GAS PIPELINES
Why we operate in the deep basin Jupiter Resources | 4 Technology matters High productivity wells - Leverage strong, integrated technical - Deeper, over-pressured reservoirs team to differentiate our results - Higher relative permeability - Employ risked innovation and challenge the status quo Large multi-zone Strong economic returns resource potential - Prolific natural gas wells supported - Multiple, high quality stacked targets by significant liquids content - Vast database from historical vertical - Low operating costs and good wells & existing 3D seismic infrastructure
Significant resource across ~330k net acres Jupiter Resources | 5 Over 6 Tcfe WOLF CREEK RED ROCK KAKWA RESTHAVEN of recoverable resource identified in proven PEMBINA MUSREAU horizontal target formations Deepcut 150 MMcf/d alone (Cardium, Dunvegan, Falher C, Falher F, Wilrich) CUTBANK JUPITER C5+ RESTHAVEN 40 MMcf/d C5+ 100 MMcf/d STRATIGRAPHIC LEGEND JUPITER KAKWA C5+ PEMBINA FUTURE HORIZONTAL TARGET FORMATION 60 MMcf/d RESTHAVEN Deepcut PROVEN HORIZONTAL TARGET FORMATION 120 MMcf/d TARGET FORMATION COMPANY LAND GAS PROCESSING PLANTS MAJOR GAS PIPELINES
Our diversified, high quality resource* Jupiter Resources | 6 >6 TCFE total resource From proven formations FALHER F 36% PROVED 20% DUNVEGAN E 10% PROBABLE 14% WILRICH 29% CARDIUM 6% ADDITIONAL RESOURCE 66% FALHER C 13% OTHER 6% Creating value in everything we do 710 derisked future locations (net) Resource split by area DUNVEGAN E 13% FALHER F 27% RESTHAVEN 20% WOLF CREEK 43% FALHER C 11% WILRICH 24% KAKWA 30% RED ROCK 7% CARDIUM 16% OTHER 9% Total Resource includes remaining reserves from all wells drilled; Other locations based on preliminary analysis of additional spirit river formations. *As at year-end 2019
Securing market access Jupiter Resources | 7 Natural Gas transportation capacity secured through long term agreements ~ 600 MMcf/d firm sales gas transportation Primarily exposed to AECO (NIT) pricing Very liquid market with growing Intra-AB demand 50,000 GJ/d optionality to Malin JUPITER MARKET EXPOSURE KEY MARKET POINTS MAJOR GAS PIPELINES
What we have done since 2014 Jupiter Resources | 8 We have spent $1.0 billion in capital, generated $1.3 billion in EBITDA (including hedging) and averaged 11% annual production growth. Wells Drilled by Production Area (gross) (mmcfe/d) RESTHAVEN KAKWA REDROCK WOLF CREEK Capital by Unit Operating Cost Type Costs ($/mcfe) ($MILLIONS) DRILLING PROCESSING FEES - CAPITAL COMPLETIONS PROCESSING FEES - OPERATING EQUIP & TIE JUPITER OPEX FACILITIES UNUTILIZED PROCESSING OTHER
What we’ve learnt to date (2014 – 2019) Jupiter Resources | 9 Team Geology - Built and fostered a highly integrated - Fuller understanding of petrophysics operations & technical team and reservoir analysis - Established strong platform for growth - Matching predictive models to results Results Operations - Improved economics - Process, cost & efficiency improvements - Larger recoverable resource - Drilling longer laterals with - Higher quality inventory optimized spacing 9
Corporate update Jupiter Resources | 10 Refinancing Summary Board of Directors comprised of: New $225 million senior secured reserve-based Simon Bregazzi (Jupiter CEO) revolving credit facility. Olivia Wassenaar (Apollo) Four largest shareholders injected ~$100 million Wilson Handler (Apollo) - Chairman of capital through second-priority senior secured Robert Pearce (Designated Party) cash/PIK notes: Notes bear interest at a rate of 13% per annum payable Eugene Davis (Designated Party) semi-annually 10% per annum payable entirely in cash 3% per annum payable in kind by increasing the principal amount Notes due February 5, 2024 Total of 100 million common shares outstanding, excluding management incentive plan. Company leverage less than 2x forecast 2020 EBITDA
Positive Energy for Canadians Jupiter Resources | 11 Natural gas is an important contributor to the North American energy portfolio “We are in the early stages of a global energy transition and Canada is better positioned than any country in the world to play a meaningful and very constructive role in shaping the future of global energy supply and to ensure the world’s energy needs are met in an environmentally responsible and socially conscientious way. We at Jupiter are committed to doing our part and excited to pursue the opportunities that lie ahead.” Simon Bregazzi , Jupiter CEO Positive energy isn’t just what we make — it’s what we’re made of.
Supplemental Materials
At Jupiter, we… Jupiter Resources | 13 Strive to be extraordinary Are committed to conducting Treat our communities with respect business in a responsible manner and dignity Are responsible stewards of the Create value in everything we do Are proud to be a Canadian shareholder capital entrusted to us energy provider 13
Minimizing our environmental footprint Jupiter Resources | 14 Jupiter Resources | 14 Innovative solutions Utilize solar power to Use wooden mats to reduce emissions minimize disturbance Leverage existing road network to reduce Capture rainwater additional tree clearing for use in operations and surface impact
Creative emissions reduction initiatives Jupiter Resources | 15 Jupiter Resources | 15 Typical Dual Wet Metered Site Methane Emissions Old - Pneumatic Site Emissions New – Electric Site Emissions Pneumatic Chemical Pumps Cactus Filters (Fuel Gas) Electric Chemical Pumps EFOY Power Units Pneumatic Choke Valves Pneumatic Valve Controller Electro/Hydraulic Choke Valve Solar Power 180 m 3 Methane Emissions per day 0 m 3 Methane Emissions per day
Jupiter liability management ratio Jupiter Resources | 16 Jupiter Resources | 16 14.2 733 34 th Frequency Jupiter Jupiter’s Licensees Overall Resources LMR* in Alberta Jupiter ranking 14.2 (704 non-zero (above the LMRs) P10 LMR) Security Adjusted LMR * LMR as at February 1, 2020
Executive team Jupiter Resources | 17 Simon Bregazzi Patrick Elliott Marian Kanik Basilis Brad Wakefield Shyla Stinson CEO EVP SVP Planning SVP Operations CFO Simon brings over 20 years Patrick brings over 20 years Marian brings over 30 years Brad brings over 20 years Shyla brings over 15 years of experience in the energy of experience in the oil and of experience in the energy of energy industry of oil and gas experience industry in corporate gas industry in North industry in economic experience in a wide range to the Company in a finance and mergers & America, in both evaluations, business of operational and broad range of corporate acquisitions. Simon holds a unconventional and development, investor technical roles. Brad holds finance and accounting BSc (Hons) in Actuarial conventional resources. relations and marketing. a Mechanical Engineering activities. Shyla is a CPA, Science from the University Patrick holds a BSc (Hons) Marian holds a BComm Technology Diploma from CA and holds a Bachelor of Western Ontario. in Geology from the from the University of the Saskatchewan Institute of Commerce degree University of Western Calgary. of Applied Sciences and from the University of Ontario. Technology. Saskatchewan. Prior or Comp ompanies: s: Prior or Comp ompanies: s: Prior or Comp ompanies: s: Prior or Comp ompanies: s: Prior or Comp ompanies: s: Canbriam Energy Canbriam Energy Canbriam Energy Centrica Energy BOS Solutions Ltd. Goldman Sachs Capitol Energy Northwest Upgrading Talisman Energy Welton Energy CIBC World Markets Encana Esprit Exploration Esprit Exploration PanCanadian Energy Canadian Hunter
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