Corporate Presentation Corporate Presentation January 2017 ( updated - PowerPoint PPT Presentation

Corporate Presentation Corporate Presentation January 2017 ( updated January 18, 2017 ) David J. Wilson, President & Chief Executive Officer Sadiq H. Lalani, Vice President & Chief Financial Officer www.KeltExploration.com

Why Invest in Kelt? Why Invest in Kelt? 1 CREATING VALUE DURING DOWNTURNS  The Kelt management team has a track record of creating shareholder value during downturns, previously in the 2008- 2009 period with Celtic Exploration Ltd., sold in February 2013 for $3.2 billion.  Kelt focuses on long-term growth with emphasis on low-cost land accumulation on resource-style plays and rapid growth of its drilling inventory portfolio.  Kelt targets a 2.0 times or better recycle ratio over the long- term on a proved plus probable reserve basis.

Common Share Information Common Share Information 2 • Stock Exchange listing TSX • Trading symbol KEL • Market capitalization $ 1.2 billion • 52-week trading range $ 2.51 – $ 7.49 • Common shares issued ( @ Jan/17/2017 ) 175.7 million → D&O’s have participated in all nine equity offerings completed to date (for aggregate gross proceeds of $615 MM) investing a total of $101 MM Stock options ( 8.4 MM ) & RSUs ( 0.7 MM ) 9.1 million ( 5.2% ) • → average exercise price of stock options is $ 6.57 / share • Diluted common shares (before convertible debentures) 184.8 million • Diluted common shares (debs convert to 16.4 MM shares) 201.2 million Directors & Officers (D&O’s) ownership 18% ( 19% diluted ) •

Convertible Debentures Convertible Debentures 3 • TSX trading symbol KEL.DB • Principal amount outstanding $ 90.0 million • Coupon / Maturity date 5.0% / May 31, 2021 • 52-week trading range $ 105.50 – $ 150.02 → D&O’s purchased $15.0 million (17%) of the total Debenture offering. Conversion privilege: Each debenture will be convertible into common shares of Kelt at the option of the holder at any time prior to close of business on the earliest of: (a) the business day immediately preceding the maturity date; (b) if called for redemption (on or after May 31, 2019), on the business day immediately preceding the date specified by the Company for redemption of the debentures; or (c) if called for repurchase (pursuant to a “Change of Control”), on the business day immediately preceding the payment date; at a conversion price of $5.50 per common share, subject to adjustment in certain circumstances.

Capital Expenditures Capital Expenditures 4 2016 2017 2017/16 ( $ millions ) 2015 Forecast Forecast Change Drilling & Completions 100.9 46.5 104.6 + 125% Facilities, Equipment & 56.0 28.8 32.0 + 11% Pipeline Infrastructure Land, Seismic & Asset 26.1 21.7 8.0 - 63% Acquisitions E&P Capital Expenditures 183.0 97.0 144.6 + 49% Corporate Acquisitions 313.4 [1] - - - Property Dispositions - ( 102.6 ) [2] - Net Capital Expenditures 496.4 97.0 42.0 - 57% Notes: [1] Acquisition of Artek Exploration Ltd. (public company), including value of debt assumed. [2] Disposition relates to the sale of Karr assets on Jan/18/2017, after estimated closing adjustments.

Drilling Program Drilling Program 5 Notes: Gross Net Average 2017 Drills [1] Alberta drilling prospects include : WI % Wells Wells Grande Prairie : - Montney - Doig 9 6.8 76% Alberta [1] - Halfway - Charlie Lake 11 11.0 100% British Columbia [2] Grande Cache : - Cretaceous [2] B.C. drilling prospects include : 20 17.8 89% Total Inga/Fireweed/Stoddart : - Montney - Doig - Baldonnel [3] Six gross ( 6.0 net ) wells drilled in 2016 ( DUCs ) Gross Net Average 2017 Completions that will be completed in 2017 : WI % Wells Wells [ i ] Pouce Coupe 02/6-18 Montney ( D2 ) [ ii ] Pouce Coupe 04/7-18 Montney ( D2 ) [ iii ] Pouce Coupe 03/7-18 Montney ( D1 ) 14 11.8 84% Alberta [ iv ] Pouce Coupe 05/7-18 Montney ( D1 ) [ v ] Pouce Coupe 00/1-9 Montney ( D2 ) [ vi ] Fireweed C-31-I Upper Montney 12 12.0 100% British Columbia 26 23.8 92% Total [3]

Production Outlook Production Outlook 6 2016 2017 2017/16 2015 Forecast Forecast Change Oil ( bbls/d ) 5,091 5,130 6,700 31% NGLs ( bbls/d ) 1,607 2,700 2,500 -7% Gas ( mcf/d ) 71,272 79,020 82,800 5% Combined ( BOE/d ) 18,577 21,000 23,000 10% Per MM Shares ( BOE/d ) 120 121 131 8%

Production Growth ( since inception ) Production Growth ( since inception ) 7 PRODUCTION ( BOE / d ) PRODUCTION PER MM SHARES ( BOE / d ) 28,000 160 CAGR since CAGR since 25,000 2013 = 55% 2013 = 25% 23,000 24,000 131 21,000 121 120 120 20,000 18,577 105 14,000 16,000 13,800 78 13,170 12,756 76 77 80 11,879 12,000 69 53 8,419 8,000 40 11,000 3,961 9,200 42 4,000 7,830 53 6,698 45 43 3,148 4,337 36 813 0 11 13 14 15 16 [E] 17 [E] 17 Exit 0 [E] 13 14 15 16 [E] 17 [E] Oil / NGLs Gas

Commodity Prices Commodity Prices 8 2017/16 ( CA $, unless otherwise specified ) 2015 2016 (E) 2017 (E) Change WTI Crude Oil ( USD/bbl ) US $ 48.80 US $ 43.25 US $ 52.00 + 20% CLS Crude Oil ( CAD/bbl ) $ 57.45 $ 52.92 $ 65.24 + 23% NYMEX Natural Gas ( USD/mmBtu ) US $ 2.67 US $ 2.45 US $ 3.05 + 24% AECO 5A Natural Gas ( CAD/GJ ) $ 2.55 $ 2.04 $ 2.95 + 45% + 1% Exchange Rate ( CAD/USD ) $ 1.279 $ 1.325 $ 1.335 Exchange Rate ( USD/CAD ) US $ 0.782 US $ 0.755 US $ 0.749 Kelt realized Oil price ( $/bbl ) + 22% $ 50.83 $ 47.06 $ 57.47 Discount to CLS ( $ 6.62 ) ( $ 5.86 ) ( $ 7.77 ) Kelt realized NGLs price ( $/bbl ) $ 23.12 $ 17.08 $ 21.22 + 24% Kelt realized Gas price ( $/mcf ) + 34% $ 2.74 $ 2.70 $ 3.63 Premium to AECO/GJ 7.5% 32.4% 23.1% Kelt realized Combined price ( $/BOE ) $ 26.45 $ 23.85 $ 32.12 + 35% Notes: [1] WTI – West Texas Intermediate – light sweet crude oil (API 40˚) for settlement at Cushing, Oklahoma, priced in USD. [2] CLS – Canadian Light Sweet – light sweet crude oil (API 40˚) for settlement at Edmonton, Alberta, priced in CAD.

Forecast 2017 WTI & AECO Prices Forecast 2017 WTI & AECO Prices 9 WTI US$/bbl AECO CA$/GJ 60.00 5.00 53.00 53.00 53.00 53.00 53.00 53.00 52.00 52.00 51.00 51.00 50.00 4.00 50.00 49.80 3.53 3.32 3.22 3.14 3.05 40.00 3.00 2.84 2.84 2.84 2.80 2.71 2.60 2.53 30.00 2.00 J [E] F [E] M [E] A [E] M [E] J [E] J [E] A [E] S [E] O [E] N [E] D [E]

Gas Marketing / Transportation Contracts Gas Marketing / Transportation Contracts 10 Volume Market Term of Firm Service Market Index ( mmBtu/d ) Hub Nov/1/2016 – Mar/31/2018 43,600 NIT AECO 5A ( CAD/GJ ) Apr/1/2018 – Mar/31/2019 55,500 Nov/1/2016 – Mar/31/2017 24,300 Chicago Chicago City-Gate Gas Daily Apr/1/2017 – Aug/31/2017 21,300 City-Gate Index ( USD/mmBtu ) Sep/1/2017 – Oct/31/2017 15,800 Sumas Monthly Index Nov/1/2016 – Oct/31/2020 4,700 Station 2 less US$0.715/mmBtu Kelt November 2016 Gas Markets 0.0% 6% AECO Chicago 33% Sumas 61% Station 2

Hedging Hedging 11 Period Quantity Fixed Price ( CA $ unless otherwise specified ) Jan/1/17 to US $1 MM / USD Currency Swap [1] CAD 1.330 Dec/31/17 month Notes: [1] The USD currency swap was entered into pursuant to a Swaption from which Kelt previously received option proceeds of $255,000, making the effective swap rate CAD 1.351.

Netbacks Netbacks 12 2017/16 ( $ / BOE ) 2015 2016 (E) 2017 (E) Change Oil & gas revenue 26.45 23.85 32.12 + 35% Realized hedging gain ( loss ) ( 0.12 ) 0.02 0.00 - Royalties ( % of revenue ) ( 10.6% ) ( 9.2% ) ( 11.2% ) + 22% Transportation expense ( 2.09 ) ( 2.83 ) ( 2.71 ) - 4% Production expense ( 11.34 ) ( 9.36 ) ( 8.88 ) - 5% Operating netback [1] 10.09 9.53 16.98 + 78% G&A expense ( 0.77 ) ( 0.91 ) ( 0.91 ) 0% Interest expense ( 0.98 ) ( 1.33 ) ( 0.83 ) - 38% Other income ( costs ) - - - Funds from operations [1] 8.34 7.29 15.25 + 109% Note: [1] See “Financial Advisories”.

Financial Outlook Financial Outlook 13 2016 2017 2017/16 2015 Forecast Forecast Change Revenue, before royalties ( $ MM ) 179.3 183.3 270.0 + 47% Funds from operations ( $ MM ) [1] 56.5 56.0 128.0 + 129% Per share – diluted ( $/share ) 0.36 0.32 0.73 + 128% Capital expenditures, net ( $ MM ) [2] 497.3 97.0 42.0 - 57% Net bank debt, at year-end ( $ MM ) [1,3] 213.0 138.0 52.0 - 62% Net bank debt / FFO ratio 3.8 x 2.5 x 0.4 x Notes: [1] See “Financial Advisories”. [2] Capital expenditures are net of dispositions. [3a] Net bank debt includes amounts outstanding under the Company’s credit facility, net of working capital. The current borrowing base amount of Kelt’s credit facility is $185.0 million. [3b] In addition to net bank debt, the Company has $90.0 million principal amount of 5% convertible subordinated unsecured debentures outstanding, maturing on May 31, 2021 and convertible to common equity at a price of $5.50 per share, subject to certain conditions and subject to adjustment in certain events.

Product Mix Product Mix 14 2017 (E) 2017 (E) Product Income Production Operating Split Split BOE/d Income ($MM) Oil 6,700 29% 88.5 62% NGLs 2,500 11% 9.7 7% Gas 82,800 60% 44.4 31% Combined 23,000 100% 142.6 100% G&A and interest expense ( 14.6 ) Funds from operations 128.0 Note: [1] The 2017 forecasted NGLs production mix is as follows: pentane (25%), butane (25%), propane (30%) and ethane (20%).