HIGH IMPACT EXPLORATION - In a Hot Eastern Australia Gas Market - PowerPoint PPT Presentation

HIGH IMPACT EXPLORATION - In a Hot Eastern Australia Gas Market TSX: BNG MAY 2017

CORPORATE PROFILE Financial Shares Outstanding (TSX:BNG) 102.3 MM Total Debt US $12.5 MM Market Capitalization @ $0.135/share (May. 1, 2017) $13.8MM Funds Flow from Operations (FFO) (Q3 FY 2017) $1.4M Corporate Reserves Values Btax PV 10 (Mar. 31 2016)* Proved + Probable (P+P) (1) $103.8MM Equivalent Value per Basic Share $1.03 / share Operational Results Average daily light oil production (Q3 FY 2017) 355 bopd Operating netback (2) including hedging (Q3 FY 2017) $69.01 / bbl Operating netback (2) excluding hedging (Q3 FY 2017) 38% $33.79 / bbl * Independent third party reserves Insider holdings (1) Details for all reference notes on this slide are located at the end of this presentation under “Endnotes”. See also "Cautionary Statements" in the Appendix and Notes to this document. 2

COOPER BASIN Australian Growth Platform  Fiscal stability and low government take  Attractive commodity pricing  High impact gas exploration - Barrolka (ATP 934)  High netback production - Cuisinier large Oil-in-Place pool with 27 of 28 wells successful  Significant oil & gas exploration acreage at Tookoonooka and BARTA ATP 934 Wompi BARROLKA Barta Cuisinier CUISINIER Tookoonooka Wompi TOOKOONOOKA Barrolka Operated WOMPI Non-operated HIGHLY PROSPECTIVE 1.1 MILLION GROSS ACRES (72% operated) Existing pipelines A STRONG PLATFORM FOR FUTURE GROWTH 3

EASTERN AUSTRALIA NATURAL GAS MARKET Australia, East Coast Gas Flows Rapid price increase driven by the expansion of LNG Facilities Eastern Australia’s LNG capacity Gladstone Queensland Curtis Australia Pacific  Eastern Australia disconnected from Northern Territory and Western Australia markets  Exports commenced from the first of three LNG projects in Queensland in early 2015 ATP 934  Expected to export over 1,400 Petajoules (PJ) (1) of gas a year  Projects will reach full production between 2018 PIPELINES and 2019 1. Moomba to Sydney PJs/y (1) 2. Queensland Gas 320 3. Roma to Brisbane 4. South West Queensland Local demand 700 5. Carpentaria 6. Moomba to Adelaide Contracted 7. Eastern Gas LNG 8. SEA Gas 1,135 9. Tasmanian Gas Additional LNG 10.Longford to Melbourne Gas capacity 11.NSW Victoria Interconnect Source: Grattan Institute Source: McKinsey & Company, Australia, March 2017 “Meeting East Australia’s Gas Supply Challenge ” (1) Details for all reference notes on this slide are located at the end of this presentation under “Endnotes”. ONSHORE/OFFSHORE BASINS IN WESTERN AUSTRALIA ~ 1,300 KMS 4 FROM KEY COOPER BASIN INFRASTRUCTURE

WHY GAS? WHY NOW? East Australia projected supply demand dynamics, 2017 – 2030, PJ PJ Spot Natural Gas Market (Sydney) Sydney Spot Gas Price 20 18 16 $AU/GJ 14 12 10 8 6 4 2 0 12/1/2016 1/1/2017 2/1/2017  Current spot pricing ex Sydney of greater than $12/GJ with an alarming upward trend.  “On the east coast, spot prices on the Brisbane Short Term Trading Market (STTM) more than doubled from an average of $3.13 1 Assumes capability to produce above nameplate capacity developed between 2020-25 SOURCE: CEDIGAZ; Wood Mackenzie — Upstream Data Tool Q3 2016 per gigajoule (GJ) in Q4 2015 to an average of  Coal Seam Gas assets require ~AUS $40 Billion to maintain $7.36/GJ in Q4 2016, and have since climbed flat production to 2030 sharply higher to $10/GJ or more .”  New investment of at least AUS $10 billion in new Source G. Bethune, EnerQuest Mar 7/17 developments required Source: McKinsey, Australia, March 2017“Meeting East Australia’s Gas Supply Challenge” (1) Details for all reference notes on this slide are located at the end of this presentation under “Endnotes”. TIGHTENING GAS MARKET DRIVING EASTERN AUSTRALIAN GAS 5 PRICE INCREASES

GAS PRODUCTION PROFILE – E. AUSTRALIA East Australia projected gas production, 2017 – 30, PJ Coal Seam Gas assets require AUS $40 billion to maintain flat production through 2030 With known development offshore & onshore production set to decline at 8.1% & 1.4% per year New gas exploration delayed by regulatory hurdles: average 12 years from Gazette of gas permit to first production Source: McKinsey & Company, Australia, March 2017“Meeting East Australia’s Gas Supply Challenge” DRILL READY GAS PERMITS POISED TO TAP INTO 6 UNDERSUPPLIED EASTERN AUSTRALIA MARKET

QUEENSLAND – World Class Gas Economics 2015 COMMERCIAL GAS EXPECTED WELLHEAD PRICES ECONOMICS 1. NWQ INDUSTRIAL ZONE SPOT PRICING: AUS $10-12/Mcf US $8.29/MCF 2. GLADSTONE INDUSTRIAL ZONE US$7.48/MCF WELLHEAD PRICING: AUS $7-10/Mcf 3. SEQ INDUSTRIAL ZONE US$7.38/MCF * Prices shown, do not include transportation NETBACK: AUS $4-8/Mcf (1) Source: The Gas Price Trends Review Report by Oakley ATP 934 situated near Greenwood Pty Ltd. Feb 2016. intersection of major pipelines (1) See "Fundamental Resource Definitions, Cautionary Statements“ and “Oil and Gas Advisories” in the Appendix and Notes to this docu ment. One commercial gas user has been quoted AUS $20/GJ for a two year contract 7 starting July 1, 2017 (Australian Financial Review, Mar 8, 2017)

NATURAL GAS EXPLORATION 8

COOPER BASIN, RECENT PERMIAN GAS ACTIVITY The basin hosts a range of gas play types within the Permian Pre-Permian Basement Depth Map , Source: Geoscience Australia, 2015 including basin-centred gas & tight gas accumulations. Barrolka Development In South Australia, the Permian 5 wells has produced over 7 Tcf of gas (2) Whanto from over 109 gas pools (since Development Silver Star 1969). 7 gas wells South Australia Queensland Senex/Origin In contrast to Queensland where only 1.6 Tcf of gas (2) has been ATP 934 recovered from over 48 gas pools (since 1988). ATP 934 is located in Queensland where Permian gas appears to be Mokami underexploited and still has great 100 kms Discovery - 8.6 potential for exploration MMCF/d (1) opportunities. (1) Beach Energy Monthly Drilling Report, March 2017 (2) Cumulative gas production from PEPSA government database up to March 31, 2016 (3) See "Fundamental Resource Definitions, Cautionary Statements“ and “Oil and Gas Advisories” in the Appendix and Notes to this document. South Australia and Queensland – similar geology 9 but vastly different pace of development

PERMIAN - WORLD CLASS SOURCE ROCK ATP 934 Total hydrocarbons generated : > 2 Trillion Barrels Oil and Gas Maturity Ro (%) Source: Geoscience Australia, 2015, Source Rocks of the Cooper Basin 10

TRANSFORMATIVE BASIN CENTERED GAS PLAY BARROLKA PERMIT (ATP 934) Top Permian Depth Map  The last Whanto well was declared part of a “basin centered gas” play. (1) Basin Centered Gas accumulations, are typically thick, continuous gas saturated reservoirs.  The targeted Permian section extends across the Windorah Trough and into ATP 934, contained within an average section of 75 to 100m (1) .  E. Australia gas market fundamentals very compelling with upward pressure on price.  Gas resources have high value in Australian market:  (i.e. Strike Energy Limited, 2C Contingent Gas Resource of 155.4 Bcf and market cap of $81.99 million) (2) Recently drilled wells 15 km (1) Based on Beach Energy Ltd. public disclosures. (2) Strike Energy Ltd. public disclosures, as of March 9, 2017 closing. 11

PERMIAN PROFILE - ACROSS THE COOPER BASIN B’ WHANTO B B B’ 12 Toolachee WINDORAH Patchawarra TROUGH Source: Geoscience Australia, 2015, Source Rocks of the Cooper Basin 75-100m thick (1) ATP 934 (1) See "Fundamental Resource Definitions and Cautionary Statements" in the Appendix and End Notes to this document. 12

ATP 934 BARROLKA PERMIT (BNG 71% AND OPERATOR) (3) PERMIT NEIGHBOURING PRODUCING GAS FIELDS & GAS PIPELINES FEEDING EASTERN AUSTRALIA  Large, undrilled 1,462 km 2 permit in gas jurisdiction Whanto Cum Prod  Active drilling around permit with 20 gas wells drilled in the last 2 years to June 2016 (1)  Producing gas fields offsetting with numerous gas pipelines crossing the permit  5 exi sti ng gas poo l s o ffse tti ng A TP 934 are p r oduci ng 17. 7 MM cf d Ramses Ramses Prospect Barrolka: ~ 36 km 2 with 396 bbls condensate per day (1) 20.2 BCF (1) Barrolka East Coonaberry ~ 12 km 2 Coonaberry  W han 6.4 BCF (1) t o w e ll s no w ti ed - i n w ith an ti c i pa t ed i n itia l ra t e o f ~ 28 - 30 Prospect ~42 km 2 MMcfd.  Management has mapped 5 prospects/leads on this permit, based on Ghina Wareena 2D seismic interpretation - covering a total area of ~107 km 2 ~ 11 km 2 7.7BCF (1) Coolah  Surrounding analog Permian T oolachee gas pools show an average Ghina ‘conventional’ pay zone thickness of approx. 9.6 m, (based on logs/tests/production data from 28 wells across a range of offsetting Ghina West pools) (2) ~ 6 km 2 (1) Production volumes cited are cum. to June 2016. Source: State of Queensland Department of Employment, Economic Development and Innovation (DEEDI). Tartulla (2) See "Fundamental Resource Definitions and Cautionary Statements" in the Appendix and End Notes to this document. 13.4BCF (1) Durham Downs/ Durham Downs Prospects North: 46 BCF (1) Gas Pools 13 15km