This presentation may include certain forward looking statements. All statements other than

Transcription

1 Bogota

2 This presentation may include certain forward looking statements. All statements other than statements of historical fact, included herein, including, without limitation, statements regarding future plans and objectives of Canacol Energy Ltd. Canacol or the Corporation, are forwardlooking statements that involve various risks, assumptions, estimates, and uncertainties. These statements reflect the current internal projections, expectations or beliefs of Canacol and are based on information currently available to the Corporation. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. All of the forward looking statements contained in this presentation are qualified by these cautionary statements and the risk factors described above. Furthermore, all such statements are made as of the date this presentation is given and Canacol assumes no obligation to update or revise these statements. Barrels of Oil Equivalent Barrels of oil equivalent (boe) is calculated using the conversion factor of 5.7 Mcf (thousand cubic feet) of natural gas being equivalent to one barrel of oil. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 5.7 Mcf:1 bbl (barrel) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. 2

3 Proven oil & gas finders in Colombia and Ecuador Exploration 15-for-24 wells (63%) Paid Value created ~$230 MM >$1 B Discovered >50 MMboe in 2P reserves Development 50-for-53 wells (94%) OIL GAS Gas focus until oil rebounds +54% CAGR in 2P gas reserves CY guidance(1) 2P reserves 10-12,000 avg. boepd (60% WTI insensitive) $84 MM E&D capex Gas 345 BCF (61 MMboe) / $852 MM(2) Oil 23 MMbls / $556 MM(3) Gas 61 EV $586 MM Oil 23 '09 '10 '11 '12 '13 '14 _ (1) Based on $60/bbl WT) average price for calendar (2) As of Feb reserve reports. Represents pre-tax NPV-10. (3) As of Jun reserve reports. Represents pre-tax NPV-10. 3

4 $8 MM E&D budget for ~63% development $32 MM spent YTD / $52 MM remaining Light oil Oriente $8 MM Llanos $33 MM Dry gas Lower Magdalena $43 MM 49% 4x production starting in Dec production from MMcf/d gas ebitda from $30 $150 MM(1) 2 wells and 1 workover left in Dry gas Starting CY Q, wells at Clarinete Pipeline to Jobo Light oil Up to 4 workovers Flow line and facilities New 3D; firm-up exploration leads (1) Annualized 4

5 Projected >10x in gas revs & ebitda Each gas contract is locked-in, take-or-pay contracts: Customers (yrs.) 5-15 Volumes (MMcf/d) 118 Gas sales price range (MMbtu) $5-$8 Price escalation (/yr.) 2-3% $500 $400 $300 $200 $100 e 20e gas activities Spend ~$300 MM to generate $1.6 B ebitda $ MM $- / yr. '15e '16e '17e '18e '19e '20e Growth from a diverse portfolio Base 2P reserves and deemed volumes Dry gas 345 BCF (61 MMboe)(1) Light oil 23 MMbls(2) Net acres Resource potential 23 contracts / 2.6 MM >280MMboe(3) Avg. boepd 0 '15e '16e '17e '18e '19e '20e (1) As of Feb reserve reports. Represents pre-tax NPV-10. (3) Mgmt. estimate (2) As of Jun reserve reports. Represents pre-tax NPV-10. 5

6 Colombia s gas demand is set to increase 9x faster than world demand Demand for gas in Canacol s target market (Caribbean coast) is set to accelerate 1.7x faster than country demand MMcf/d Thermoelectric Transport +15% +0% +10% 800 Ecopetrol -3% +3% Petrochemical Industrial +2% Bogota +3% 200 Commercial Residential 0 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15e '16e '17e '18e Source UPME 6

7 3 Guajira fields -20% y/y Chuchupa Riohacha Ballena Caribbean coast Demand 14 e CAGR + % ~575 MMcf/d in 8e 7 gas fired power plants Caribbean Sea Barranquilla Supply ~501 MMcf/d in 3 Guajira fields declined ~20% y/y (blow-down) Supply options were limited in the Lower Mag < gas fields only % of Colombia s production Cartagena Lower Mag Basin Canacol is the new supply source Late performance 2 discoveries tripled 2P reserves y/y to 345 BCF Signed gas contracts to boost production by 6x to 118 MMcf/d over the next 3 yrs. Clarinete La Creciente +58 MMcf/d Upside ~785k gross acres, ~15% of basin >2 TCF gross unrisked prospective resources Palmer Cerro Matoso Nelson Gas field Compressor TGI pipeline Promigas pipeline 7

8 La Creciente Geography: Fastest growing gas market in Colombia World >> Colombia >> Caribbean Coast (Canacol s market) +1% +9% +15% per yr. Geology: Repeatability from Cienaga de Oro reservoir Nelson Palmer Clarinete 3 key discoveries from same reservoir Booked 2P reserves 345 BCF(1) VIM 5 100% VIM % 345 BCF(1) + >2 TCF upside(2) 15 prospects/leads Gas: Growth platform Blocks 4 Gross acres Locked-in growth starting in Dec ~785k, ~15% of basin 4x production MMcf/d Expand ebitda $30 $150 MM(3) (1) Reserve reports as of Feb (2) Represents gross unrisked prospective gas resources (3) Annualized VIM % Palmer Clarinete Tie in Jobo Nelson km ESPERANZA 100% Gas pipeline Prospects and leads Fields and discoveries Lower Magdalena 8

9 VIM 5 Upper Zone -6,410 ft subsea ~3,000 acres Oboe-1 appraisal well program in Oboe-1 + Clarinete-2 Opportunity ahead 80 MMcf/d for 10 yrs. (1) Reserve report as of Feb, pre-tax NPV-10 (2) Resource report as of Feb, pre-tax NPV-10 Clarinete-2 appraisal Clarinete-1 Subcrop edge 9

10 Cartagena 7 gas fired power plants capacity Upgrade Jobo facilities MMcf/d Finish 15 km flow line to tie Clarinete to Jobo Quadruple production MMcf/d From 120 to 185 MMcf/d Filadelphia Expand ebitda $30 $150 MM(1) Sincelejo La Creciente +58 MMcf/d Design, construct and execute ~ km pipeline Between Jobo and Sincelejo Upgrade from 10 pipe From 15 to 75 MMcf/d Jobo Clarinete Between Sincelejo and Cartagena: Pipeline loop Gas field Compressor Promigas pipeline Palmer Nelson New compression at Filadelphia Bypass around Sincelejo Shipping 20 MMcf/d south (1) Annualized 10

11 26 MMbls oil trend(1) 08 present Blocks RH (100%) and LLA 23 (90%) Net acres / oil fields 112k / 6 Success 89% (32/36 wells) Remaining 2P reserves 10 MMbls(2) CY Q Production 4,953 bopd Realized price / netback $58.62 / $30.78 LLA 23 Las Maracas ~12 MMbls Cravo S ~9 MMbls Tigro Cravo E ~8 MMbls L P New 3D Trends that may rhyme Potential for ~40 MMbls of remaining prospective resources(3) activities Complete acquisition of 3D seismic (in yellow) and firm-up future exploration leads Macarenas ~6 MMbls Lab M 3D Flow line from Tigro to Labrador + injection facilities, ~$5/bbl improvement in opex by Jul R H 26 MMbls oil trend(1) (1) Gross barrels produced from Aug to Jan (2) Reserve reports for Labrador, Leono, Pantro, Tigro as of Jun Reserve report for Rancho Hermoso as of Jun (3) Management s estimate of net unrisked recoverable prospective resources Fault Oil fields Leads 11

12 714k net acres 2 nd largest shale land position in Colombia Santa Isabel N Ecopetrol 2 Shell Shell VMM VMM 3 Drilling VIM 37 CNOOC New D&M Report reveals large upside present for Canacol(1) Covers only 3 of 7 prospective shale oil blocks COR 39 Exxon S 4 5 COR 4 Exxon N 6 COR 11 7 COR 12 S (1) Represents DeGolyer & MacNaugton resource report mean estimate for Canacol s gross working prospective oil resources and potential NPV- respectively, effective Jun 12

13 Gas focus until oil rebounds CY guidance(1) 10-12,000 boepd (60% WTI insensitive) e 10-12,000 boepd 100% from base 2P reserves Base 2P reserves Dry gas Light oil 345 BCF (61 MMboe)(1) 23 MMbls(2) e 20e, exploit a diverse portfolio Base 2P reserves production +20% CAGR, 11k 32k boepd e Prove up >280 MMboe(3) Exploration resource upside from >280 MMboe(3) 33k boepd (1) Reserve reports effective Feb. Represents pre-tax NPV-10. (2) Reserve reports effective Jun. Represents pre-tax NPV-10. (3) Management s estimate of net risked prospective resources 13

14 TSX (CNE), BVC (CNEC), OTCQX (CNNEF) In mm Shares outstanding (1) USD in mm Market capitalization $387.7 Bank debt Convertible bond Working capital (78.8) Net debt $198.4 Enterprise value $586.1 Apr new long-term credit agreement $200 MM (2) (3) (3) (3) $8 $6 $5 $3 $2 Equity markets begin to take notice 3.90 Replaces existing senior credit agreement $- CDN $/share Matures Sep No principal payments until Dec Amortizes thereafter in 8 equal quarterly payments Interest payable quarterly at LIBOR % Relaxed financial covenants (1) As of December 31, 2014, after effect of subsequent property acquisition with shares, and includes dilutive securities (2) Converted using CDN USD exchange rate (0.82) as of 5/2/15 (3) As of December 31,