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E A E AGL E E NE R GL E E NE R GY INC. INC. Eagle Presentation | - PowerPoint PPT Presentation

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All Information Contained in this Presentation is Confidential and for Internal Purposes Only E A E AGL E E NE R GL E E NE R GY INC. INC. Eagle Presentation | May 2017 Why invest in Eagle? There are several paths to significantly increased

  1. All Information Contained in this Presentation is Confidential and for Internal Purposes Only E A E AGL E E NE R GL E E NE R GY INC. INC. Eagle Presentation | May 2017

  2. Why invest in Eagle? There are several paths to significantly increased shareholder value  Eagle is one of the best positioned to benefit from a rebound in oil prices  Significant liquids production, high netback and a stable asset base with low decline  Trading at a discount to Net Asset Value  Eagle trades at approximately 15 % of its Total Proved year ‐ end 2016 reserves net asset value per share Total Proved Net Asset Value Per Share  Potential to unlock significant value in our assets  We have identified 218 potential horizontal drilling opportunities on existing Eagle lands in North Texas and over 1,500 additional opportunities in the area where we will continue to actively lease.  Production growth in the Project could double Eagle’s corporate production in less than 4 years  Eagle Management ‘s core competencies are directly aligned with maximizing the probability of success in North Texas  Capital provider that has the financial capability to help Eagle grow to achieve greater cash flow faster and without having to sell properties at the bottom of the market Eagle’s experienced Board and management team have guided Eagle through one of the worst oil price downturns in memory. While many others have failed, their stewardship has put Eagle into a position to grow and succeed. 2

  3. Eagle Summary  Eagle operates 352 active wells (1) in Alberta, Texas and Oklahoma  Current production approximately 3,900 boepd (88 % liquids)  Corporate decline rate of 18 %  Total Proved (“1P”) Reserves of 14.2 million boe and Total Proved plus Probable (“2P”) Reserves of 20.9 million boe (2)  Q1 2017 Field Netback of $20.81/boe  2017 Guidance  Production: 3,800 to 4,000 Boepd  Operating Costs: $2.1 to $2.3 million per month  Capital Budget: $22.8 million  Symbol: TSX:EGL  Long Term Debt: $US 57.5 million  Shares Outstanding (basic) : 42.9 million  Market Cap: $ 21.5 million (3) Notes: (1) Includes producing wells and injectors (2) Per McDaniel & Associates Consultants Ltd., and Netherland, Sewell & Associates, Inc., Eagle’s independent reserves evaluators, with an effective date of December 31, 2016 (3) Based on a share price of $0.50/ share 3

  4. Eagle’s Canadian Assets Current production 2100 boepd (1) – 80 % liquids • • 90 % operated Concentrated • Dixonville is a premier Montney light oil waterflood in High Quality Western Canada with discovered oil initially in place of Asset Base with 147 million bbls and 1P recovery factor of 16 % Operational • Twining is a large conventional Pekisko light oil pool with a Control Dixonville : low recovery factor where new Horizontal well technology • Current Production 1000 Boepd (WI) • Decline < 10 % has unlocked significant additional reserves. • Large discovered oil initially in place 147 Mmbbls (Recovery 6 % to date, 16 % 1P recovery) • Future waterflood enhancement and drilling • Decline rate 8 % (Ultimate recovery target of 25 to 30 % ) • PDP reserves 77 % of 1P and 52 % of 2P Low Decline Production, High • Significant waterflood enhancement and recovery factor PDP Reserves improvements at Dixonville to target a total recovery of Twining : with Significant 25 to 30 % • Current Production 750 Boepd (WI) Growth • Greater than 50 potential horizontal drilling • Low Decline of 8% Development • On ‐ going Conventional Horizontal Development opportunities at Twining in addition to the 12 horizontal • Greater than 50 horizontal drilling opportunities Opportunities wells that Eagle or its predecessors have drilled • IRR > 30 % at $50/bbl WTI • Current LMR is 3.2 Low Near –Term • Low inactive well count of 52 Abandonment • Low abandonment liability over the next 10 years Liability, • Our Canadian asset base therefore positions us favourably to High LMR weather any changes to the abandonment regulations in Alberta Notes: (1) – Includes working interest and royalty interest volumes 4

  5. Eagle’s US Assets North Texas : • Current production 1800 boepd ‐ 99 % liquids, 100 % operated • Current Production 400 Boepd (WI) • Decline 18 % • Salt Flat is a large light oil pool from the Edwards limestone Concentrated • Substantial core growth area with > 24,000 acres formation originally developed using vertical wells • 218 horizontal drilling opportunities on existing land High Quality • Applying new horizontal well technology in existing • Eagle has drilled over 58 horizontal wells and completed many Asset Base with conventional reservoir production enhancement and operating cost reduction projects • IRR > 40 % at $50/bbl WTI Operational • North Texas is a light oil asset and is the major growth area of Control Eagle where existing production, infrastructure and land holdings give Eagle a strategic advantage • Decline rate 20 % • Low differential to WTI and low operating costs, highest netback in the company • Greater than 12 additional horizontal development wells at Salt Flat and continued optimization projects • Significant geological and geophysical work over the High Netback Oil last two years has resulted in the accumulation of with Significant land and opportunities in North Texas Salt Flat : Growth • Current Production 1400 Boepd (WI) • Over 24,000 net acres Development • Decline of 25 % • On ‐ going Conventional horizontal Development • 218 potential horizontal drilling opportunities to be Opportunities • Greater than 12 horizontal development wells developed on existing acreage • IRR > 50 % at $50/bbl WTI • Horizontal wells with capital costs of $US 2.5 million • IRR > 40 % at $50/bbl WTI • Ability to double Eagle’s corporate production from the North Texas assets within the next 4 years 5

  6. 2016 Year ‐ End Reserves (1) Excellent year-over-year reserve performance • Total proved plus probable reserves of approximately 20.9 million boe (68% proved, 52% proved producing) • PV10 value on total proved plus probable reserves of approximately $270 million • Proved plus probable reserve life index of 15 years Reserves by Category PV10 Value ($MM) McDaniel & Associates Price forecast (as of Jan 1, 2017) $79 29% WTI Crude Oil Year $/bbl 2017 55.00 52% $153 2018 58.70 $29 13% 2019 62.40 2020 69.00 $10 2021 75.80 2% PDP PDNP PUD Probable PDP PDNP PUD Probable Notes: 1) Per McDaniel & Associates Consultants Ltd., and Netherland, Sewell & Associates, Inc., Eagle’s independent reserves evaluators, with an effective date of December 31, 2016. 6

  7. Eagle’s Strategy Horizontal Wells in Low Decline (Corporate Decline 18 %) Conventional Plays Liquids Production (75 % of Eagle Production from Horizontal Wells) 3,900 boepd (88 % Liquids) TOTAL SHAREHOLDER RETURN Build Inventory of Focus on Return to Low Risk Locations Low Leverage for Growth Balance Sheet ( 218 Drilling Opportunities in (5 Year Plan Reduces D/CF to < 1x North Texas) at $55/bbl WTI) 7

  8. Eagle’s History and the Pivot to Growth Discovery Growth Sustainability Twining ‐ Pekisko Eagle’s Proved Developed Assets Decreasing Risk Dixonville ‐ Montney Eagle’s existing North Texas opportunities on a risk and development continuum Salt Flat Edwards Benches Time and Capital  Historically, Eagle’s asset growth was through acquisitions (Salt Flat 2010, North Texas 2014, Dixonville 2014, Twining 2015 and Maple Leaf 2016).  Asset growth through acquisitions and sustaining production through capital investment provided for a dividend paying model.  With the fall in oil prices, access to additional capital for acquisitions became limited for juniors the size of Eagle.  Eagle looked within its existing asset base and identified organic opportunities to create sustainable growth that could ultimately lead to a return to the dividend model. 8

  9. Eagle’s Operational Core Competencies and Successes Proven success year over year in operational efficiency of conventional assets  Water disposal/injection optimization  Improved artificial lift LOE 18 %  Operating cost optimization projects  Skilled at operating waterfloods and fields with high water cuts  Top quartile capital efficiency and FD&A  Proven driller and operator of horizontal wells in conventional fields FD&A  Highly successful, focused and disciplined operating team 53 % Cap Eff  Strong geological and geophysical capability with proven track record 30% of developing successful plays  Effective and efficient operator in multi jurisdiction and regulatory environments  Strong reservoir management team  Detailed understanding of fields and reserve drivers RRR  Excellent reservoir management process and execution 272 % Notes: (1) LOE: Lease Operating Expenses, FD&A: Finding , Development & Acquisition Costs, Cap Eff: Capital Efficiency, RRR: Reserves replacement ratio 2P (2) The average decrease in our LOE , (field operating expenses ) is before the effects of foreign exchange 9

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