Corporate Presentation November 2011

Transcription

1 Corporate Presentation November 2011 Forward-Looking Statements This presentation contains "forward-looking statements" including estimates of future production, cash flows, reserve life, debt position, net debt to cash flow, business plans for drilling and exploration, and estimated amounts of capital expenditures, the assumptions upon which estimates are based and related sensitivity analyses, and other expectations, beliefs, plans, objectives, assumptions or statements about future events or performance (often, but not always, using words or phrases such as "expects", "budgets", "anticipates", guidance, "plans", "estimates" or "forecasts", or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved). Forward-looking statements are based on current expectations, estimates and projections that involve a number of risks and uncertainties, which could cause actual results to differ materially from those reflected in the statements. Forward-looking statements are based on the estimates and opinions of the corporation's management at the time the statements are made. Bellamont assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change. Page 2 1

2 Snapshot Summary Reserves/Production Q2 Production (46% oil & liquids) 2,549 boe/d Q Operating Netback ($/Boe) $30.28 P+P Reserves 11.5 MMboe Capitalization Class A Shares BMX.A (TSXV) 140,997,699 Class B Shares BMX.B 1,012,000 Options (Average price $0.64) 12,875,000 Market Capitalization* $52.2 MM Avg. Daily Liquidity** 164,581 Financial Net Debt (Sept. 30, 2011 estimate) Credit Facility $35.2 MM $57.0 MM *As of November ; BMX.A = $0.37, BMX.B = $3.75 ** Class A shares only, past 90 days to Oct. 14, 2011 Page 3 Core Areas - Oil and Liquids Focus Focus on Quality Assets Maintain High Working Interest and Operatorship Large Oil and Gas in Place Reservoirs High netbacks, low operating costs Low decline rate, base production is less than 20% Deep Inventory of Oil Opportunities Montney oil has been the key focus Baldonnel oil - resource play concept ~150 locations, 129 target oil Over $300 million of capital projects Page 4 2

3 Montney Oil Focus Three Montney oil pools at Grimshaw, Grande Prairie and Rycroft BMX is the 6th largest Montney oil producer in Western Canada ~1300 Boe/d* BMX has 5 of the top 50 Montney initial rate oil wells 85 Montney oil drilling locations * As per CIBC World Markets Research Report dated October 31, 2011 BMX Land Montney Oil Recent Montney Activity Whitecap Valhalla 83MM bbls OOIP 16-40% Recovery BMX Rycroft OOIP 10 MM bbls/sec BMX Grand Prairie 1900m deep 90 Bcf & 30MM bbls DPIIP Pace Dixonville 150 mmbbl OOIP 17-23% R.F. BMX Grimshaw 900m deep OOIP 15MM bbls/sec Devon Normanville Recent 150 bbls/d IP Galleon Girouxville ARC Ante Creek Trilogy Kabob 3,000 bbls bopd 1.9 mmcf/d test 50m Montney Isopach 40 km RMP Waskahigan 1,800 bpod test PennWest Kaybob 50m Page 5 Grimshaw: BMX Montney Oil Discovery Large Oil in Place Bellamont vertical well oil (30 API) discovery Shallow depth 900 metres T84 R24 Recent vertical well tests R23W5 T84 10 horizontal wells drilled to date,100% owned battery constructed ~530 boe/d (net) with two new horizontal wells recently added 3D seismic covers most of BMX s land T83 T83 Q2 netback - $44/boe 2 vertical test wells recently drilled to push play to the west 3D Seismic Horizontals wells recently placed on production in October R24 BMX Land Option Lands HZ Producer R23W5 Montney Sand Fairway Vertical Test Wells Page 6 3

4 Grimshaw Development Plan Delineating Upside of Large OOIP* Management estimates there is over 100 million barrels OOIP at Grimshaw 52 million barrels OOIP* in Established Area alone Only 10.7 million barrels of OOIP* recognized in 2010 Y/E reserves T84 R24 Recent vertical test wells R23W5 Established Area T84 Significant additional reserve bookings expected 2011 Y/E 15 (14.25 net) more horizontal locations in Established Area T83 T83 Another 46 (35.5 net) horizontal locations outside of Established Area 3D Seismic Potential for over 2500 boe/d *OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. **Management estimate based on well control, core analysis and 3 dimensional seismic R24 BMX Land Farmin Lands Vertical Test Wells HZ Producer 2012 program R23W5 Montney Sand Fairway Infill Locations Contingent Locations Established Area Page 7 Grimshaw Analog Pool - Dixonville DIXONVILLE Current production ~3,000 bbl/d oil from 103 producing wells, 60 water injectors 150 million bbls OOIP at Dixonville R1W6 R26 R25 R24 R23 R22W5 Dixonville T86 Booked at 18.7% recovery factor GRIMSHAW Current Production ~ 530 boe/d from 11 producing wells, 0 water injectors Potential for 100 mmbbl OOIP* Booked at less than 1.0% of management s OOIP** estimate Grimshaw Potential *OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. **Management estimate based on well control, core analysis and 3 dimensional seismic T84 Montney Edge T83 T82 Page 8 4

5 Grimshaw Advantages Gross pay is twice as thick at Grimshaw than Dixonville; more OOIP* per section No bottom water means Grimshaw wells can be fraced Fracing leads to double the production rate and higher sustained rates Grimshaw can be developed with 8 wells per section vs. 16 wells per section at Dixonville Daily Oil Production (bbl/pd) Grimshaw versus Dixonville Type Well Months on Production Grimshaw Av Hz Well Dixonville Avg Hz Well Grimshaw wells ~double the production rate *OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. Page 9 Grimshaw Superior Economics Grimshaw Type Well Per well 8 wells/section # Locations (net) 61 (50 net) Capital per well ($mm) $2.1 Reserves, mboe 215 NPV10*, k$ $4,626 ROR 89.2% Payout (yrs) 1.3 PIR@10% 2.23 F&D Cost ($ per Boe) $9.73 $ per Boe/d $21,000 Recycle Ratio (Q2) 4.5 Recycle Ratio in excess of 4.5X based on Q2 netback Based on 10.5% recovery factor Does not include any water flood reserves * Based on GLJ October pricing forecast, estimated values do not represent fair market values Page 10 5

6 Grimshaw Waterflood Upside Potential 3500 Pace Dixonville Montney C Pool Production Oil Rate (bbl/d), GOR (scf/bbl) Water inj rate (bbl/d) Dixonville seeing significant water flood response Pace touting a 23% recovery factor under waterflood Reservoir modeling at Grimshaw indicating a 19% recovery factor Bellamont to initiate a water flood pilot at Grimshaw in 2012 Page 11 Grande Prairie: BMX Montney I Oil Pool Large Pool; > 30 million bbl OOIP and 90 BCF OGIP natural gas (gross)* ~1000 boe/d (284 bbl/d oil and NGL s and 5.2 mmcf/d gas) from 6 wells Five of the top fifty Montney oil wells drilled in Western Canada** Avg. IP rate 485 boe/d*** per well (27% Oil & NGL s) 8 additional locations at 4 wells per section Royalty incentives enhances netbacks new wells >$30/boe (2012e) 3 wells being licensed Potential for > 3000 boe/d by 2014 *OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. *As per CIBC World Markets Research Report dated October 31, 2011 *** Per producing day (first three months) Page 12 6

7 Grande Prairie Montney Economics Per well 4 wells/section # Locations (net) 8 (8 net) Capital per well ($mm) $4.3 Reserves, mboe 640 NPV10*, ($mm) $6.8 ROR 52.0% Payout (yrs) 1.4 PIR@10% 1.6 F&D Cost ($ per Boe) $6.77 $ per Boe/d $11,111 Recycle Ratio (Q2) locations possible at 8 wells/section (only 4 booked) 8 wells/section increases RF and project NPV Oil Prices Production History Grande Prairie Montney I Pool Well Production rate (boe/pd) Netback Sensitivity * Based on GLJ October pricing forecast, estimated values do not represent fair market values 0 Average of existing producers ~485 Boe/d GLJ reserves type 4 wells/section Months on Production Natural Gas Prices ($/mcf) $ $ 3.00 $ 3.25 $ 3.50 $ 3.75 $ 4.00 $ 4.25 $ 5.00 $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ Page 13 New Core Areas: Birch and Stoddart, B.C. 54 sections (43 net) in multizonal area 94-G-1 94-G-1 94-H-4 94-H-3 94-H-2 Baldonnel - Light Oil Oil saturated fairway between Birch and Stoddard BMX sections (31.5 net) Resource Play type potential with horizontal wells and multi fracs Montney - Liquids rich gas Up to 60 bcf OGIP per section Current horizontal wells drilling near Birch Area Storm/Paramount/Yoho BMX 28 sections (23 net) 94-B B-9 94-B-8 94-B-8 R25 R24 BMX Land R23 Baldonnel Oil Tests Birch R22 Baldonnel Oil Fairway Stoddard R21 Baldonnel Oil Production R20W6 Page A A-10 T88 T87 T86 7

8 Birch Area Baldonnel Light Oil BMX lands offsetting light oil (38º API) pool Pool developed via short radius open hole ( OH ) horizontal wells (i.e. no fracs) Historical average OH well: 125 bbl/d oil initial rate 139 mboe reserves average per well (to date) BMX to drill longer (1600 metre) wells with multi-staged fracs Potential for >300 bbl/d oil initial rate (3X increase of OH wells) 12 locations directly offsetting pool 16 additional contingent locations Potential to extend pool farther, 4-6 million barrels OOIP*/Section *OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. Page 15 Stoddart Area Baldonnel Light Oil Baldonnel formation exhibits similar reservoir attributes as the Birch pool Three vertical wells have produced similar production profile as Birch area verticals Not yet developed with horizontal wells BMX to drill a multi-staged fraced horizontal well between vertical producers. 5 firm locations directly offsetting pool, 1 planned for Q1, additional contingent locations Potential for a pool size similar to Birch and to extend it farther *OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. Page 16 8

9 Stoddart: Another Birch Pool? Birch Pool Pre 1993 Peak Production 200 bbl/d oil from 8 vertical wells Average IP rate ~30 bbl/d per well Peak production > 2280 boe/d (~1800 bbl/d oil) after 20 horizontal wells drilled Cumulative production to date 3.6 mmbbl oil and 7 BCF of gas BIRCH AREA STODDART AREA Stoddart peak production 75 bbl/d from 4 vertical wells Average IP rate ~30-40 bbl/d. i.e. as good or better than Birch Cumulative production to date 84 mbbl oil and 0.7 BCF of gas Potential for 17 horizontal wells Cumulative oil production per well Page 17 Baldonnel Oil Economics Per well Horizontal Wells with Open hole and acid (OH) Horizontal Wells with Multistaged Sand Frac # Locations 43 (43 net) 43 (43 net) (net) Capital per $2.2 $2.7 well ($mm) Reserves, mboe NPV10*, k$ 2.8 $8.8 ROR 46% 452% Years PIR@10% F&D Cost ($ $14.44 $7.16 per Boe) $ per Boe/d $13,750 $6,000 Recycle Ratio Oil rate (bbl/d) Baldonnel Type Curves BMX believes a 3X multiple (i.e >400 boe/d 75% oil) is possible with longer reach horizontals and multi staged fracs Months on production Actual Birch Area Vertical Wells Actual Stoddart Area Vertical Wells Actual Birch Area Horizontal Wells with Acid Wash Type Curve: Horizontal wells with Acid Wash Type Curve: Horizontal wells with Multi stage Sand Frac Potential to add over 8,000 boe/d if fracs increase productivity or 2,000 boe/d using conventional OH technology * Based on GLJ October pricing forecast, estimated values do not represent fair market values Page 18 9

10 Drilling Inventory Unbooked Oil Upside Oil Targets Included in BMX Formation Total Net Locations 2010 Reserve Report Net Unbooked Locations Montney Doe Creek/Dunvegan Baldonnel Total Gas Targets Included in BMX Formation Total Net Locations 2010 Reserve Report Net Unbooked Locations Fahler Other Total Page 19 Board and Management Track Record of Success Board of Directors Scott Saxberg, BSc., P.Eng., Chairman President and CEO, Crescent Point Resources Ltd. Rob Peters, BEcon President of Black Diamond Land & Cattle Co. Keith MacDonald, BSc, P. Geol Executive Chairman, Venturion Natural Resources Ltd. Greg Bay, BComm, CFA President and CEO, Cypress Capital Management Ltd. Stuart Clark, BComm Independent Businessman Ian Fergusson, BComm, C.A., C.F.A. Senior Vice President Camcor Capital Inc. Steve Moran, BBA President and CEO, Bellamont Exploration Ltd. Management Steve Moran, BBA President and CEO Trevor Murphy, Bsc, P.Eng Vice President, Corporate Development Brian Ritchie, BSc, P.Eng Vice President, Exploitation Peter O Leary, BSc, P. Geol Vice President, Exploration Craig Thomas, B.Comm Vice President, Land Tavis Carlson, B.Comm, C.A. Vice President, Finance and CFO Collectively own approximately 9% of Class A shares > $10 million invested Page 20 10

11 Net Asset Value Value basic share (2,3) Value per diluted share (4) Asset Category Total Before tax value (M$) (1) Proved Producing Reserves 4,960 Mboe (5) $99,518,000 $0.66 $0.61 Total Proved Reserves 6,405 Mboe (5) $107,518,000 $0.71 $0.66 Probable Reserves 5,118 Mboe (5) $48,310,000 $0.32 $0.30 Total Proved + Probable Reserves (@NPV10%) 11,523 Mboe (5) $155,828,000 $1.03 $0.96 Undeveloped land (acres) (6) 79,530 $7,950,000 $0.05 $0.05 Net Debt (June 30/11) $38.6 million ($38,600,000) ($0.26) ($0.24) Proceeds from stock options (4) $7.4million n/a $0.05 Total Net Asset Value $125,178,000 $0.83 $0.81 $0.81 NAV per fully diluted share on July1, 2011 GLJ price deck Majority of value ($0.61) is proved developed producing reserves (1) Utilizing GLJ Petroleum Consultants July 1, 2011 price forecast; estimated values do not represent fair market value. (2) 140,997,699 Class A shares issued and outstanding as at December 31, 2010 (3) Assumes conversion of the 1,012,000 Class B shares to Class A shares on a 10:1 basis (4) Assumes the issuance of an additional 12,070,000 Class A shares issued pursuant to the Corporation s stock option plan at an average price of $0.61 resulting in total proceeds of $7,353,000. (5) December 31, 2010 reserve report as evaluated by GLJ (6) Internal estimate equivalent to $100 per net corporate undeveloped acre Page 21 Why Invest in Bellamont Oil Focus to Drive Growth Low risk Oil/NGL weighted growth properties Deep drilling inventory of ~150 locations, only 20 of which are booked Delineation program at Grimshaw could further prove substantial oil resource Exciting Resource Potential new opportunities in new B.C. core area Track record of profitable per share growth Value Recycle ratio of 2.4X for the past three years CAGR of 60% on production per share CAGR of 37% on reserves per share Current corporate netback of ~$30.00/Boe driving solid cash flow Conservatively booked reserves, 61.0% of the value are proved, developed and producing vs. industry average of 46.0% (1) Attractive entry point for value investors looking for leverage to oil upside (1) Based on 63 reporting issuers as of April 5, 2011; Data provided by Canoils database Page 22 11

12 Corporate Information Reserves Evaluator: GLJ Petroleum Consultants Bank: National Bank Legal Advisors: Heenan Blaikie LLP Auditors: KPMG Research: FirstEnergy Capital Cody Kwong RBC Capital Markets Mike Harvey GMP Stacey McDonald Haywood Securities Geoff Ready National Bank - Dan Payne Page 23 Definitions 1. Original Oil In Place (OOIP) and Original Gas In Place (OGIP) are equivalent to Discovered Petroleum Initially-In-Place (DPIIP). DPIIP, as defined in the Canadian Oil and Gas Evaluations Handbook (COGEH), is that quantity of petroleum that is estimated, as of a given date, to be contained in known accumulations prior to production. The recoverable portion of discovered petroleum initially in place includes production, reserves, and contingent resources; the remainder is unrecoverable. There is no certainty that it will be economically viable or technically feasible to produce any portion of this OOIP and/or OGIP except for those identified as proved or probable reserves. 2. OOIP and OGIP (DPIIP) estimates are based on current accepted technology and prepared internally by Bellamont Exploration by a qualified Professional Engineer. Page 24 12

13 Appendix Intentionally Left Blank Page 25 Proven Track Record of Per Share Growth 3,000 2,500 2,000 1,500 1, Production Growth Oil + NGLs (bbls/d) Gas (boe/d) Per thousand shares Getting more oily in ,343 1, CAGR of 60% production per share since ,500 1,300 1, Aug 2011 (est) $25,000 $20,000 $15,000 $10,000 $5,000 $0 Cash Flow Growth Funds Generated from Operations (000s) Per share $3,782 $2,674 $15,799 $21, (est) 51% cash flow per share growth projected for 2011 CAGR of 19% CFPS share per share since 2008 $0.16 $0.12 $0.08 $0.04 $ Page 26 13

14 Reserves: Growth on Conservative Bookings CAGR of reserves per share of 37% per share since 2007 PDP reserves comprise 61% of total P+P vs. industry average of 46.0% (1) 64% of future revenues are from Oil and NGL s Only 20 net drilling locations included ($48 mm of FDC) RLI is 10.7 years (1) Based on 63 reporting issuers as of April 5, 2011; Data provided by Canoils database 14,000 12,000 10,000 8,000 6,000 4,000 2,000 1,320 YEARLY GROWTH 2,655 5,173 11, Gas (mboe) Oil + NGLs (mbbl) Reserves/thousand shares Proved Undevelo ped 6% VALUE ALLOCATION Probable 33% Proved Dev. Producing 61% 61% proved, developed and producing BT NPV 10 % Category Oil Gas NGL Boe % Oil and NGL s (GLJ Jul 1 Pricing)* mbbl MMcf mbbl Mboe Boe $MM Proved Developed Producing 2,040 15, , % $99,518 Total Proved 2,222 22, , % $107,518 Probable 1,585 18, , % $48,300 Total Proved + Probable 3,807 41, , % $155,818 Page 27 * Estimated values do not represent fair market value FD & A and Recycle Ratios 2010 Three year average* Proved Plus Proved Plus Total Proved Probable Total Proved Probable Reserve Additions (Mboe) Exploration & Development 1,648 2,323 3,423 5,237 Acquisitions 2,655 4,886 3,670 6,293 Finding and Development Costs ($/boe) Excluding FDC $ $ $ $ Including FDC $ $ $ $ Acquisition Costs ($/boe) Excluding FDC $ $ $ $ Finding, Development & Acquisition Costs ($/boe) Excluding FDC $ $ $ $ Including FDC $ $ $ $ FD&A (including changes in FDC) of $12.45/Boe Three year FD&A (excluding changes in FDC) of $12.49/Boe Based on current estimated netback of ~$30.00/Boe 2.4X recycle ratio on 2010 FD&A (incl. changes in FDC) 2.4X recycle ratio on three year FD&A (excl. changes in FDC) Page 28 14

15 Rycroft Another Montney pool to develop Bellamont s vertical discovery well produced initially at 75 bbl/d (40 API) and still producing approximately 15 bbl/d after 30 months Large OOIP* - 6 million bbl/section Horizontal wells in analog Saddle Hills D Pool (6 miles south) producing at ~140 Bbl/d first year average Oil Rate (bbl/d) Rycroft Montney : Horizontal versus Vertical ~4 X Months on Production Bellamont Vertical Avg Saddle Hills D Hz Avg Saddle Hills D Vt *OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. 4X multiple for horizontal wells vs. verticals 12 potential horizontal locations, Page 29 Doe Creek and Dunvegan: High Quality Light Oil Shallow Cretaceous Sands - generally less than 1000 metres High quality API oil Net OOIP* of 35 MMbbl over numerous pools Multiple exploitation opportunities including water flood. Average waterflood recovery factor is 35%. Stable production and cash flow Current operating data (est.): 600 boe/d (83% oil) $45/boe netback 12 horizontal locations, 7 booked * OOIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. Page 30 15

16 Valhalla Large Gas Resource Large Gas Pool - 56 BCF (Net) OGIP* Only 11.6 BCF (21%) of OGIP booked to date Well defined pool with seven producing wells >95% average working interest No tenure issues Great option value to improving gas prices Profit to investment ratio of 0.5 (10% Discount) at $5.00 flat gas pricing 20 locations, 8 booked * OGIP is equivalent to Discovered Petroleum Initially-In-Place (DPIIP) as defined in this presentation. Page 31 16