Corporate Presentation December, 2015
Advisory Regarding Oil and Gas Information Throughout this presentation the terms Boe (barrels of oil equivalent ) & MBoe (thousands of barrels of oil equivalent) are used. Such terms may be misleading, particularly if used in isolation. The conversion ratio of six thousand cubic feet per barrel (6 Mcf: 1 Bbl) of natural gas to barrels of oil equivalent and the conversion ratio of 1 barrel per six thousand cubic feet (1 Bbl: 6 Mcf) of barrels of oil to natural gas equivalent is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value. Any references in this presentation to initial production rates (IP30) and production rates at the end of the first year (IP365) are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will continue production and decline thereafter. Readers are cautioned not to place reliance on such rates in calculating the aggregate production for Mosaic. Mosaic has presented certain type curves and well economics which are based on historical production in the Kakwa/Resthaven development area. Such type curves and well economics are useful in understanding management's assumptions of well performance in making investment decisions in relation to development drilling in the Kakwa/Resthaven area and for determining the success of the performance of development wells; however, such type curves and well economics are not necessarily determinative of the production rates and performance of existing and future wells. In this presentation, estimated ultimate recovery represents the estimated ultimate recovery associated with the type curves presented; however, there is no certainty that Mosaic will ultimately recover such volumes from the wells it drills. This presentation discloses drilling locations related to proved and/or probable reserves locations. These locations are derived from Mosaic’s most recent independent reserves and resources evaluation as prepared by Sproule & Associates as of July 1, 2015 (the “Sproule Report”) and account for drilling locations that have associated proved and/or probable reserves as applicable. There is no certainty that Mosaic will drill all drilling locations and if drilled there is no certainty that such locations will result in additional production. References to the future development of the Kakwa/Resthaven area are intended to provide the reader with a demonstration of the potential scale of future development. Actual drilling locations and the timing of development will ultimately depend upon the availability of capital, regulatory, oil and natural gas prices, costs, actual drilling results and other factors. Mosaic Energy Ltd. • 2
Forward-Looking Statements Certain statements contained in this Corporate Presentation constitute forward looking statements or information (collectively "forward looking statements") within the meaning of applicable securities legislation. All statements other than statements of historical fact are forward looking statements. This Corporate Presentation contains forward looking statements pertaining, but not limited to, the "full development plan" of Mosaic and the timing and method of financing thereof; the use of proceeds from the proposed offering; the Corporation’s exploration and development activities; drilling inventory, drilling plans and timing of drilling and completion of wells; the timing of completion of the Corporation’s new gas plant and anticipated benefits related thereto; the performance and characteristics of Mosaic’s oil and natural gas properties; future operating costs and future cash flow; commodity prices and costs; industry conditions pertaining to the oil and gas industry and treatment under government regulation and taxation regimes. No assurance can be given that these assessments and other forward-looking statements will prove to be correct and such forward looking statements in this investor summary should not be unduly relied upon. Forward looking statements are typically identified by words such as "anticipate", "continue", "estimate", "expect", "forecast", "may", "will", "project", "could", "plan", "intend", "should", "believe", "outlook", "potential", "target" and similar words suggesting future events or future performance or may be identified by reference to a future date. Mosaic has made assumptions regarding, among other things: the timing and completion of the proposed offering; the timing and amount of future capital expenditures; future sources of funding for the Corporation’s "full development plan"; future operating costs and future cash flow; future crude oil, natural gas and NGL prices and commodity prices generally; government regulation in the areas of taxation, royalty rates and environmental protection; the performance characteristics of oil and natural gas properties; the size of Mosaic’s oil, natural gas and NGL reserves and the recoverability of its reserves; the ability to raise capital; the impact of competition; labour availability; and general economic business and market conditions. Although the Corporation believes that the expectations reflected in the forward looking statements contained in this Corporate Presentation, and the assumptions on which such forward looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward looking statements included in this Corporate Presentation, as there can be no assurance that the plans, intentions or expectations upon which the forward looking statements are based will occur. By their nature, forward looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward looking statements will not occur, which may cause the Corporation's actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward looking statements. These risks and uncertainties include, among other things: general economic conditions in Canada, the United States and globally, including reduced availability of debt and equity financing generally; industry conditions, including fluctuations in the price of oil, NGLs and natural gas; liabilities inherent in oil and natural gas operations; governmental regulation of the oil and gas industry, including environmental regulation; fluctuation in foreign exchange or interest rates; geological, technical, drilling and processing problems and other difficulties in producing reserves; unanticipated operating events which can reduce production or cause production to be shut in or delayed;; the ability of management to execute its business plan; the possibility that government policies or laws may change or governmental approvals may be delayed or withheld and uncertainties as to the availability and cost of financing. Readers are cautioned that the foregoing list is not exhaustive of all possible risks and uncertainties. These factors should not be considered as exhaustive. Statements relating to "reserves" are by their nature forward- looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described can be profitably produced in the future. The forward looking statements contained in this Corporate Presentation speak only as of the date of this Corporate Presentation. The Corporation does not undertake any obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise, except as required by applicable securities legislation. The information contained in this investor summary does not purport to be all inclusive or to contain all information that a prospective investor may require. Prospective investors are encouraged to conduct their own analysis and to consider the advice of their financial, legal, accounting, tax and other advisors. Mosaic Energy Ltd. • 3
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