Opportun rtunity ty overvi view ew February, 2020 Opport - PowerPoint PPT Presentation

Opportun rtunity ty overvi view ew February, 2020

Opport portunity unity Summary ry Opportunity Privately held company owned 90% by insiders ◼ Team members with previous experience and success ◼ with early stage Duvernay plays Unique opportunity to be an early stage investor in the ◼ most prolific, scalable light oil resource play in Canada Large contiguous 100% working interest land base in ◼ the heart of a significant new oil fairway extension. Premium reservoir characteristics, low cost early entry ◼ and proximity to infrastructure result in top tier full cycle economics that will compete favorably with leading shale plays in North America Land position being de-risked by offsetting oil ◼ production Financing Strategy In 2020 will raise capital to fund Duvernay development ◼ program Source: GLJ Petroleum Consultants Early – Stage Land Capture Opportunity Prior to Development 1

Investm stment ent high ghlight ghts • Analogous rock to the Kaybob oil window, significantly over-pressured and highly receptive to fracturing Prolific Light Oil • Thick reservoir and high TOC content with ideal thermal maturity Resource • Dense well control and quiet depositional environment creates high predictability and repeatability New offset oil well confirms high quality (~40 ° API) oil production • • Early entrant establishing a land base of 176 sections in the heart of play Large Contiguous • Drilling inventory of >400 two mile horizontals in upper zone on existing land at 300m inter-well spacing Land Base and • Expansion potential to >200 sections and 500 locations with additional upside through down-spacing Inventory • Produces North American leading operating netbacks of ~$50/boe at $60 WTI Best Netbacks and • Analogous Kaybob oil window results are industry leading, conservative half cycle IRR’s of >50% and payback Premium of <2 years Economics • Break-even at $35 WTI, 6 years of 5% Crown royalties (13% Avg Lifetime) • Close proximity to town of Valleyview and major highways, farmland with year-round access • 100% crown land and excellent tenure Strategic Location • Access to well-developed surface infrastructure, oil / gas egress and gas processing, and fresh water for unconstrained development and strong full cycle returns • Management has a proven track record of identifying and developing high quality resource plays and Experience and extensive Duvernay success Leadership • Management and board heavily invested with 90% insider ownership • Capturing new industry results and technical learnings at an exponential rate • Land position purchased at $42 / acre ($105 / ha), historical land prices in Kaybob at $10,000+/acre Outsized Return • Early entry, cheap land capture and strategic location translate into top tier full cycle returns Potential • 10 year plan to grow to $2.5 Billion+ valuation Opportunity to Invest in an Early Stage Top Tier North American Light Oil Resource Play 2

Management agement Tea eam Team has had significant management and operational Larry Evans, Executive Chairman experience in successfully prospecting and Engineer, business strategy ◼ developing resource plays, including the Duvernay ◼ 32 Degrees Capital, numerous operating companies Mitch Putnam, Executive Director Mapped and evaluated the prospect, internally Geologist, business strategy ◼ financed and captured an initial 176 section land 32 Degrees Capital, numerous operating companies ◼ position with opportunities to expand to 200+ sections Brad Culver, President Developed collaborative relationships with leading Geophysicist with extensive experience prospecting and developing ◼ Duvernay players resulting in free real time capture of resource plays including Duvernay information and best practices from >$1 billion of Teine Energy, Birchcliff Energy, Encana Corporation ◼ capital expenditures and R&D Melissa Fabreau, VP Engineering Engineer specializing in resource play development strategy, reservoir ◼ evaluation and project management 32 Degrees Capital, Enerplus Corporation ◼ Trent Baker, CFO Finance/Accountant focused on financial analysis and business strategy ◼ 32 Degrees Capital, KPMG ◼ Drilling/Completions (TBD) Operations (TBD) Geoscientist (TBD ) Value creation through proven technical expertise and prudent financial stewardship 3

Posi sitio tioning ning The B-32 32 Land d Base Land Base 176 sections (>110,000 acres) of 100% crown land ◼ 4 year license terms with an extension of a 5 year ◼ intermediate term 1 well continues 32 sections ◼ Offsetting Activity $20+ MM currently being spent on 3 offsetting ◼ Duvernay HZ wells by Hitic Energy, an early B-32 Exploration mover in the Kaybob oil window First well came on production fall 2019 and ◼ is a confirmed oil well Further production data from first well and ◼ production results from next two wells will further Producing Oil Well de-risk B- 32’s land base Hitic Energy Reservoir Characterization 3 Hitic Energy wells drilled, 8 cored wells and 11 ◼ 2 well Pad wells with oil shows within to define the sweet spot Drilled May/June 2019 Black oil window ◼ > 15 MMbbl OOIP ◼ Tmax of 443 ° C – 450 ° C ◼ Confirmed 38 ° - 40 ° API light oil ◼ Duvernay penetrations in Blue Hitic Wells in Blue 4-6% TOC ◼ Bounding depths 2500m to 2900m Confirmed 15 kPa/m (50% over-pressured) ◼ B-32 offers a unique opportunity to invest into a large contiguous land position currently being de-risked by offsetting activity 4

Strateg tegic ic locat ation ion & In & Infrastr astruct ucture ure Oil Egress Proximal to oil terminals for initial trucking and ◼ potential future connections for pipelines Pipeline options to underutilized existing ◼ infrastructure Pembina Phase VII expansion onstream in ◼ 2021 Gas Processing TCPL receipt points with available firm service ◼ Two under-utilized active gas plants reducing ◼ TCPL Receipt Point need to build out new infrastructure Sufficient capacity to meet 10-year plan Water Sourcing Scalable infrastructure in place for future expansion Numerous surface sources with no water ◼ restrictions in the area Ability to add storage and water recycling to ◼ support future growth Location/Access Multiple Trucking Options in Area • Pembina Valleyview Truck Terminal Proximal to Valleyview on well developed ◼ • Tervita Disposal Facility CNRL Sturgeon Lake Gas roads • Plains Midstream Facility Plant @10% utilization Farm land with year round access ◼ B-32 Basin is located around legacy infrastructure with excess gathering, egress and water supply for future development ➢ Result is <$10 operating costs, modest facility/pipeline capital spending, and manageable firm commitments 5

Reser ervoir voir Compara arativ tive Pressure Maturity Storage 20 460 8% Pressure Gradient (KPa/m) 18 7% 450 16 6% 14 440 12 5% TMax°C TOC (%) 10 430 4% 8 3% 420 6 2% 4 410 2 1% 0 400 0% B-32 Vesta Kaybob Oil Permian B-32 Vesta Kaybob Oil Permian B-32 Vesta Kaybob Oil Permian Window Wolfcamp Window Wolfcamp Window Wolfcamp "B" "B" "B" Thickness Depth Fracability 0.3 45 3,500 40 3,000 0.25 35 Drilling Depth (m) Possion's Ratio 2,500 0.2 Net Pay (m) 30 2,000 25 0.15 20 1,500 0.1 15 1,000 10 0.05 500 5 0 0 - B-32 Vesta Kaybob Oil Permian B-32 Vesta Kaybob Oil Permian B-32 Vesta Kaybob Oil Permian Window Wolfcamp Window Wolfcamp Window Wolfcamp "B" "B" "B" Reservoir Parameters in Line With Leading Duvernay and North American Oil Plays 6

Industry ustry develo elopments ents Kaybob Oil Window Development Analogous reservoir and geo-mechanical properties to B-32 ◼ Hundreds of millions of dollars spent on R&D throughout the ◼ basin Productivity has continued to increase with evolving ◼ B-32 Northern completion design and longer laterals as industry moves Extension towards the optimal frac recipe A number of cost savings initiatives including switching to ◼ slickwater (from hybrid fluids) and using lower cost domestic brown sand Oil window is moving from delineation into development, ◼ which will drive considerable further cost savings Murphy Oil Window Dataset Emerging As The Premier Scalable Light Oil Play In Canada “Two Creeks Outperforming East Shale Basin” 147 Duvernay Wells Drilled in 2019 ◼ (50% Drilled In Liquids Window) KAYBOB Two Creeks Source: Athabasca Oil Analogous to Murphy’s Kaybob Oil wells, the B -32 Type Curve has room for improvement 7

Analog og & T & Typ ype e Curve ve Compari pariso son Calendar Daily Oil Production ◼ The B-32 Type Curve of 570 bbl/d (89% Liquids) and an EUR of 400 B-32 Type Curve mbbl ◼ Type curve has been developed based on the Murphy oil window dataset Active 2019 drilling will lead to new ◼ wells brought on production in 2020 Cumulative Oil Production to Date 14 – 2019 Murphy Drills – 4 – 2019 Shell Drills 6 Month Cumulative Production – Murphy wells - 79 Mbbl B-32 Type Curve B-32 Type Curve 5 – 2019 Hitic Energy Drills – Type curve – 69 Mbbl B-32 will incorporate the learnings ◼ and advancements from industry activity into our first well Analogous to Murphy’s Kaybob Oil wells the B -32 Type Curve has room for improvement 8