CanOils Canadian Energy Producers Benchmarking Study. May 9, 2016

Transcription

1 CanOils Canadian Energy Producers Benchmarking Study May 9, 016

2 About Us JWN is the most trusted provider of information, intelligence and insight about Canada s energy industry. JWN s CanOils database provides its clients with fast, accurate and complete annual and quarterly data and analysis to give business leaders an edge in discovering actionable opportunities in Canadian oil and gas. Inform Connect Grow

3 0 Introduction 0 Methodology 06 Peer Groups 07 Metrics 08 Data Formulae 11 Caveats 1 Comparison Charts 1 Intermediate Producers 1 Junior Producers 9 International Producers 8 Canadian and U.S. Gas Producers Data Tables Table of Contents

4 Introduction JWN is excited to showcase the breadth and depth of its CanOils database through this comprehensive benchmarking study on the 01-1 costs associated with Canadian energy production, including a comparison of Canadian and U.S. gas producers (Montney and Marcellus plays). All data in this report have been retrieved from the CanOils database, which provides complete, timely and accurate coverage of 9 exploration and production (E&P) companies, the vast majority of which are listed on the TSX and TSX-V. The data have been normalized to ensure comparability. CanOils financial and operating performance data, which goes back as far as 00, easily integrates with Excel and enables users to analyze, compare, benchmark and evaluate opportunities. Disclaimer Underlying data comes from company disclosures. JWN and CanOils provide the comparison to demonstrate the costs of energy production. This report does not constitute a solicitation or recommendation for the purchase or sale of any security. It is provided for information only and is not intended to serve as investment advice. JWN and CanOils cannot be held responsible for accuracy and all readers are encouraged to conduct their own research. This report is provided by JWN and CanOils as a service to the reader without responsibility for accuracy. JWN and CanOils must be credited with developing this report if any part of it is reproduced. CanOils also offers: Company holdings, wells and land data; Oilsands project cost, production and capacity forecast data; Broker forecasted performance data; Daily Canadian M&A deal coverage; and Executive compensation data. We hope you find the insights valuable and thought-provoking. Bemal Mehta Senior vice-president, energy intelligence JWN

5 Methodology

6 6 Peer Groups The producers in this study were divided into five peer groups. Intermediate Producers Companies that are not international producers and produced between,000 and 100,000 boe/d on average in 01 (full year). Junior Producers Companies that are not international producers and produced less than,000 boe/d on average in 01 (full year). International Producers Companies that had more than 0 per cent of its 01 average production (full year) outside of Canada, regardless of its annual production level. Analysis was also conducted on Canadian and U.S. gas producers. The Montney and Marcellus plays, respectively, were chosen as they are both gasproducing shale plays in North America. Montney Play Companies that operate almost exclusively in the Montney play in Canada and report a sufficient amount of cost-related data to perform the required analysis. Marcellus Play Companies that operate almost exclusively in the Marcellus play in the U.S. and report a sufficient amount of cost-related data to perform the required analysis.

7 7 Metrics The following cost metrics per boe were chosen: 1) Finding and Development Costs ( ) of Proved Reserves ) Operating and Transportation ( Opex & Transport. ) ) Royalty ) General and Administrative ( General & Admin. ) ) 6) s The metrics were chosen by experienced industry analysts as the key components of reporting a full supply cost measure in an accurate and comparable fashion, from publicly available data. Quintiles for intermediate, junior and international producer comparison charts, are based on the 01 full supply cost metric. Notes: Royalty Given that U.S. companies do not report royalties per boe separate from their revenues per boe (report on a net of royalties basis), royalties per boe were excluded from the Canadian and U.S. gas producers. Exchange Rate Some of the companies included in this report use U.S. dollars as their functional currency. For the purposes of this report, all data that was originally reported in U.S. dollars in both 01 and 01 have been converted into Canadian dollars at a rate of U.S.$1 to CDN$1.86, the annual average rate for 01. The same rate has been used for both 01 and 01, so that costs can be compared on a like-forlike basis.

8 8 Data Formulae The following section includes the data formulae used to calculate the cost metrics per boe. All measures relate to annual 01 data unless otherwise stated. 1) Three-year Average Finding and Development Costs of Proved Reserves ( Develop. Costs ) per boe Notes: Canoils has the data to support more complex methodologies that may be required for in-depth analysis. The formula for the Canadian and U.S. gas producer comparison is as follows: Sum of all exploration costs between 01 and 01 + Sum of all development costs of proved reserves between 01 and 01 Sum of all exploration costs between 01 and 01 + Sum of all development costs of proved reserves between 01 and 01 Sum of all technical revisions between 01 and 01 (positive figures only) Sum of all Sum of all extensions + improved + and discoveries recovery between between 01 and and 01 Sum of all revisions between 01 and 01 (positive figures only) Sum of all Sum of all extensions + improved + and discoveries recovery between between 01 and and 01 All reserve-related items are taken from the annual reserve reconciliations of proved reserves. The formula excludes the following items for the purposes of simplicity and comparability: The formula uses total revisions in place of technical revisions, as US companies do not typically split between technical revisions and economic revisions. Negative revisions Economic revisions Future development costs

9 9 Data Formulae ) Operating and Transportation ( ) per boe The two measures below have been combined to allow comparability between companies that do not report a split between the two cost metrics and those that do..a) Operating per boe E&P operating expenses Total production All operating expenses have been broken down to show purely E&P and oilsands segment expenses for companies that have multiple segments. This data may include transportation expenses if the company does not separate it out..b) Transportation per boe E&P transportation expenses Total production For multi-segment companies, all non-e&p related measures are excluded from this calculation where possible. For companies that do not report transportation expenses separately from their operating expenses, a null value represents their transportation expenses. ) Royalty per boe Royalty expenses Total production This is a pure E&P measure calculated using royalty expenses as reported on income statements. There are a handful of companies that only report data on a net of royalties basis, so these companies full supply costs will be lower than the actual amounts.

10 10 Data Formulae ) General and Administrative ( ) per boe G&A expenses excluding stock-based compensation Total production This formula is for the full general and administrative expense amount for each company, and is not a pure E&P measure, as most companies do not report a clear split between segments. If stock-based compensation is reported, it is excluded from the full general and administrative amount for that company. ) per boe expenses Total production 6) s per boe The sum of: Three-year Average Finding and Development Costs ( ) per boe Operating and Transportation ( Opex & Transport. ) per boe Royalty per boe General and Administrative ( General & Admin. ) per boe per boe Notes: The full supply costs calculation for the Canadian and U.S. gas producers excludes royalty expenses. This formula is for the full interest expense amount for each company, and is not a pure E&P measure, as most companies do not report a clear split between segments.

11 11 Caveats The following caveats apply to this study: Companies with a significant amount of diluent expenses have been excluded to aid comparability between the various peer groups in the report. Not every company in each peer group reported all of the required data items. In these cases, the quintile and mean were calculated as a weighted average using only those companies that reported the related data items, to avoid null value impact. As a result of this calculation method, the full supply costs for both junior and international peer groups is not equal to the sum of the its component costs. Some companies in both groups did not report transportation expenses separately from their operating expenses and were excluded from the transportation expenses per boe calculation..

12 Comparison Charts

13 Intermediate Producers

14 1 1 Royalty 6 Intermediate Producers Figure 1. Average Total Costs per boe s Royalty $.91 $7.7 $.09 $.1 $1.79 $1.0 $.0 $1.9 Finding and development costs and operating expenses are the two largest costs facing intermediate producers. There appears to be limited room for savings for gasweighted operators in the lowest quintile. This is due to their development drilling focus in deep plays like the Montney. Operators focused on oil plays have plenty of room to manoeuver with finding and development costs reaching almost $/boe in 01. General & Admin. $.08 $.7 s -1% Transportation Operating $.08 $1.7 $9. $11.6 Royalty -60% 17% -% Costs -1% Transportation 0% Operating -17%

15 1 1 Royalty 6 High Qtl nd Qtl Intermediate Producers Figure. Finding and Development (F&D) Costs per boe rd Qtl $1.71 $1.1 $1.9 $1.6 $7.81 $1.9 Intermediate producers saw minimal declines in finding and development costs in 01. This is partially due to gas-weighted companies focused on development drilling in the Montney and Deep Basin. Day rates from rigs capable of pad drilling remained strong throughout the year. It is also partially due to more intensive fracture stimulation programs pulling forward production without necessarily adding comparable increases in reserves. th Qtl $10.7 $11.7 High Qtl 1% nd Qtl 6% Low Qtl $8.10 $7.60 rd Qtl -10% th Qtl -% Low Qtl 6% Mean $1.79 $1.0 Mean -%

16 16 1 Royalty 6 Intermediate Producers Figure. Opex and Transportation per boe Mean Low Qtl th Qtl rd Qtl nd Qtl High Qtl $.6 $.1 $16.06 $17.0 $1.01 $1.11 $10.00 $1.76 $11.0 $6.6 $1.98 $8.6 $8.1 $1.7 $10.0 $1.8 $.09 $1.68 $.09 $9. $.08 $11. $11.6 $1.7 $1.10 $1. $17.9 $1.1 $18.18 $. $1. $1.9 $16.0 $11.76 $. $1.7 Operating expenses declined on average by $.07/boe for the intermediate group in 01. Highly efficient gas producers in the lowest quintile saw costs stay flat. High Qtl -% nd Qtl -% rd Qtl -1% th Qtl -1% Low Qtl 0% Mean -1% Opex Transport

17 17 1 Royalty 6 Intermediate Producers Figure. Royalty per boe High Qtl nd Qtl rd Qtl $. $.69 $6.11 $6.8 $9.8 $11.60 Royalty savings represented the largest percentage of supply cost savings in 01. Alberta s new royalty framework will be based on average supply costs for given areas, favouring those companies that have the lowest supply costs excluding royalties. th Qtl $1.6 $.97 High Qtl -61% nd Qtl -66% rd Qtl -7% Low Qtl $1. $.91 th Qtl -67% Low Qtl -1% Mean -60% Mean $.91 $

18 18 1 Royalty 6 Intermediate Producers Figure. General and Administrative (G&A) per boe High Qtl nd Qtl rd Qtl $1.71 $1.67 $.98 $.1 $. $.6 General and administrative expenses were down $0.9/boe for intermediate operators. These savings should grow as severance packages work their way out of the system. However, with a high-weighting of gas producers in this group, many companies were already running lean due to longer-term lower gas prices, so savings may be less. th Qtl $1. $1.9 High Qtl -10% Low Qtl $0.80 $0.9 nd Qtl -% rd Qtl % th Qtl -17% Mean $.08 $.7 Low Qtl -1% Mean -1%

19 19 1 Royalty 6 Intermediate Producers Figure 6. per boe High Qtl nd Qtl rd Qtl $.88 $.6 $. $.70 $.8 $.9 payments grew substantially in the intermediate category, averaging $0.8/boe higher in 01 than the previous year. This is largely being driven by having fewer barrels of production to spread payments over and an inability to raise money in capital markets to lower debt. th Qtl $.6 $.6 High Qtl % nd Qtl 6% Low Qtl $. $.6 rd Qtl 1% th Qtl 7% Low Qtl % Mean $.1 $.09 Mean 17%

20 0 1 Royalty 6 Intermediate Producers Figure 7. s per boe High Qtl nd Qtl rd Qtl $0.10 $.6 $.0 $. $61.7 $6.9 There is a $.96/boe difference in average supply costs between the highest-cost quintile of producers and the lowest-cost quintile for 01. The lowest-cost producers are the gas-focused operators that have survived six years of pricing pressure and are already lean operators. th Qtl $.66 $0.1 High Qtl -% nd Qtl -8% Low Qtl $17.76 $18.81 rd Qtl -0% th Qtl -16% Low Qtl -6% Mean $.0 $1.9 Mean -1%

21 Junior Producers

22 1 Royalty 6 Junior Producers Figure 8. Average Total Costs per boe s Royalty $1.89 $1.79 $.18 $8. $.76 $1.1 On average, junior companies made great strides in cutting supply costs in 01, cutting costs excluding royalties by $./boe. Higher prices, however, will be needed for this group to grow their way to lower costs. $1.01 $1.7 s -0% General & Admin. Transportation $.8 $.9 $1.86 $1.8 Royalty -61% 6% -1% Costs -19% Transportation 1% Operating -9% Operating $11.87 $ s in this chart are not the sum of the component part as shown in this chart. Please refer to slide 11 for explanation.

23 1 Royalty 6 High Qtl nd Qtl Junior Producers Figure 9. Finding and Development (F&D) Costs per boe rd Qtl $1.90 $1.0 $16.9 $19.6 $0.8 $7.8 Junior producers in the highest quintile, mostly reflecting oilweighted companies targeting resource plays, saw a significant drop in finding and development costs as a huge over supply in rigs targeting shallow formations resulted in day rates on the spot market cratering to below $10,000 per day. th Qtl $9.91 $10.7 High Qtl -% nd Qtl -17% rd Qtl -11% Low Qtl $.9 $6.8 th Qtl 8% Low Qtl -9% Mean $1.01 $1.7 Mean -1%

24 1 Royalty 6 Junior Producers Figure 10. Opex and Transportation per boe Mean Low Qtl th Qtl rd Qtl nd Qtl High Qtl $16.9 $16.01 $17.8 $18. $1.1 $1. $10.9 $11.69 $7.1 $1.8 $1.90 $18.9 $1.68 $17.69 $1.0 $18.77 $1.6 $19.80 $1.89 $1.0 $1. $1.99 $.09 $1.7 $. $1.91 $9.0 $8.67 $1.9 $10.61 $11.87 $1.86 $1.7 $1.08 $1.8 $1.9 Operational costs for gasweighted juniors in the lowest quintile are higher than in other categories due partially to their reliance on third-party processing and partially to their being in the exploratory and early development phase of production. High Qtl % nd Qtl -% rd Qtl -1% th Qtl -10% Low Qtl -1% Mean -8% Opex Transport

25 1 Royalty 6 High Qtl nd Qtl Junior Producers Figure 11. Royalty per boe rd Qtl $.0 $.0 $.80 $11. $11.60 $11. Like in all other categories, royalties reductions represent the greatest savings in supply costs in 01. Changes to Alberta s royalty regime could have a significant impact on smaller companies starting out as supply costs will be higher than average until they gain sufficient size and move further into the development phase. th Qtl $.86 $.91 High Qtl -0% nd Qtl -6% rd Qtl -61% Low Qtl $0.97 $.9 th Qtl -% Low Qtl -80% Mean -61% Mean $.18 $

26 6 1 Royalty 6 Junior Producers Figure 1. General and Administrative (G&A) per boe High Qtl nd Qtl rd Qtl $.0 $.6 $.88 $. $.6 $6. Oil-weighted junior companies in the highest quintile reported significant savings in general and administrative expenses in 01. This is likely related to stock-option incentives being common with junior operators, along with cuts in consultant fees. th Qtl $1.6 $.0 High Qtl -9% nd Qtl -6% rd Qtl -1% Low Qtl $1.8 $. th Qtl -0% Low Qtl -19% Mean -19% Mean $.8 $

27 7 1 Royalty 6 Junior Producers Figure 1. per boe High Qtl nd Qtl rd Qtl $1.0 $1. $1.60 $1.6 $.66 $.66 Many junior companies managed to cut interest payments per boe in 01 as cash flow went to debt repayment rather than into drillbit growth. This is likely not sustainable due to high decline rates in resource-play focused companies. However on average, interest expenses actually increased for the peer group between 01 and 01. th Qtl $1.97 $.8 High Qtl 8% Low Qtl $1. $1.6 nd Qtl -% rd Qtl -1% th Qtl 16% Mean $1.89 $1.79 Low Qtl -18% Mean 6%

28 8 1 Royalty 6 High Qtl nd Qtl Junior Producers Figure 1. s per boe rd Qtl th Qtl $9.68 $. $. $.96 $6.1 $.1 $.7 $6.1 High supply costs in the exploration and early development phase of production put junior companies in a tough spot with current low commodity prices. They need to grow to leverage pad drilling and other technologies and to take advantage of economies of scale by owning their own infrastructure to cut finding and development costs and operational costs. However, with access to capital constrained due to low commodity prices, this will be a difficult task. Low Qtl $18.9 $. High Qtl -19% nd Qtl -% rd Qtl -% Mean $.76 $ th Qtl -11% Low Qtl -7% Mean -0%

29 International Producers

30 1 Royalty 6 International Producers Figure 1. Average Total Costs per boe s Royalty $.0 $. $7.9 $19.9 $0.18 $71.10 The good news is many companies that made major overseas discoveries are beginning to advance to the development stage. Total supply costs dropped by an average of over $0/boe in 01, driven largely by cuts in finding and development costs and operating expenses. $16.8 $.98 s -9% General & Admin. Transportation $.6 $7.7 $9. $11.18 Royalty -9% -6% -9% Costs -7% Transportation -1% Operating -1% Operating $1. $ s in this chart are not the sum of the component part as shown in this chart. Please refer to slide 11 for explanation. 0

31 1 1 Royalty 6 International Producers Figure 16. Finding and Development (F&D) Costs per boe High Qtl nd Qtl rd Qtl $1.1 $0.1 $. $6.1 $7.9 $0. International companies had much higher finding and development costs than all other categories, reflecting the early stages of development of many projects and the remoteness of some projects. A number of companies are exploration focused, adding to the cost. th Qtl $1.76 $19. High Qtl -1% nd Qtl 0% rd Qtl 7% Low Qtl $.6 $. th Qtl -% Low Qtl -81% Mean -9% Mean $16.8 $

32 1 Royalty 6 International Producers Figure 17. Opex and Transportation per boe Mean Low Qtl th Qtl rd Qtl nd Qtl High Qtl $1.9 $1.0 $1.6 $1.97 $1. $1.9 $9. $1.77 $1.17 $19.7 $1. $1.61 $6.9 $0. $0.18 $1.66 $1.66 $0.8 $16.6 $6.8 $19.0 $6. $19.81 $19.89 $.9 $1.17 $19.7 $9. $.86 $11.18 $7.8 $6.78 $9.10 $7.16 Operating expenses were also higher on average compared to Canadian production, again reflecting the remoteness and early stages of development of international operators. Transportation costs are significantly higher with many countries not having a developed pipeline network. High Qtl 6% nd Qtl -11% rd Qtl -% th Qtl -% Low Qtl -% Mean -1% Opex Transport

33 1 Royalty 6 International Producers Figure 18. Royalty per boe High Qtl nd Qtl rd Qtl $7. $17.89 $0.0 $1.6 $.1 $.70 International royalty rates vary greatly from country to country, but as in Canada they came down significantly in 01. Royalties, however, were as much as three times higher in some jurisdictions in 01 when compared to Canada. th Qtl $.11 $1.1 High Qtl -9% nd Qtl -% rd Qtl -1% Low Qtl $.7 $7.6 th Qtl -6% Low Qtl -8% Mean -9% Mean $7.9 $

34 1 Royalty 6 International Producers Figure 19. General and Administrative (G&A) per boe High Qtl nd Qtl $6.01 $6.78 $16.7 $1.7 General and administrative expenses are higher for international operators that often need multiple local offices and employees. rd Qtl $.1 $6.8 High Qtl 8% nd Qtl -11% th Qtl $.6 $6.7 rd Qtl -18% th Qtl -17% Low Qtl -% Low Qtl $.6 $10.6 Mean -7% Mean $.6 $

35 1 Royalty 6 International Producers Figure 0. per boe High Qtl nd Qtl $1.1 $1. $6.11 $1.06 With many companies in the early stages of exploration and development, interest expenses will decrease on a per boe basis as production grows. rd Qtl $1. $0.8 High Qtl 11% nd Qtl -8% th Qtl $0.79 $1.1 rd Qtl 7% th Qtl -% Low Qtl -60% Low Qtl $6.1 $1.1 Mean -6% Mean $.0 $

36 6 1 Royalty 6 High Qtl nd Qtl International Producers Figure 1. s per boe rd Qtl $.88 $8.7 $7.6 $8.11 $89. $90.11 Supply costs for internationally focused companies are much higher than those focused on the Canadian market. This is due to the early stages of development of oil and gas exploration in many countries, the lack of processing and transportation infrastructure, and high royalties in countries with under developed economies that rely on resource revenues to fund governments services. th Qtl $1.60 $77.10 High Qtl % nd Qtl -19% Low Qtl $.7 $7. rd Qtl -% th Qtl -% Mean $0.18 $71.10 Low Qtl -% Mean -9%

37 7 1 Royalty 6 Summary Figure. Average per boe Intermediate Producers Junior Producers $.0 $1.9 $.76 $1.1 Junior producers managed to cut supply costs 0 per cent in 01 as they were able to take advantage of lower service and supply costs on the spot market and benefited from lower royalties. International producers saw even greater supply costs declines but they are still above current oil prices. Intermediate Producers -1% International Producers $0.18 $71.10 Junior Producers -0% International Producers -9%

38 Canadian and U.S. Gas Producers (Montney and Marcellus Plays)

39 9 1 Canadian and U.S. Gas Producers Figure. Finding and Development (F&D) Costs per boe Marcellus $.97 $.0 High-deliverability Marcellus wells spread the drilling, completion and equipment costs over more reserves, giving it an advantage over the Montney. Marcellus -10% Montney 18% $6. Montney $

40 0 1 Canadian and U.S. Gas Producers Figure. Opex and Transportation per boe Montney Marcellus $1.91 $.6 $.7 $.09 $.81 $6.8 $.76 $.1 $7.7 $8.7 $7. $8.1 Opex: The Marcellus has a significant advantage in operating costs due to it being more of a dry gas play, and the extreme high productivity of its wells spread infrastructure costs over more boe/d of production. Transportation: A lack of transportation capacity in the Marcellus gives the wellconnected Montney a major advantage. But capacity is coming in the Marcellus, meaning this advantage may erode in the near future. When transport costs are taken into account, the Montney and Marcellus have similar netbacks excluding royalties. Marcellus -1% Montney -11% 0 10 Opex Transport

41 1 1 Canadian and U.S. Gas Producers Figure. General and Administrative (G&A) per boe $1.6 Marcellus $1.89 With natural gas prices depressed for the last seven years, both Montney and Marcellus operators run lean organizations. $1.1 Marcellus -% Montney -% Montney $

42 1 Canadian and U.S. Gas Producers Figure 6. per boe Marcellus $1. $1. Marcellus operators were more successful raising capital and paying down debt in 01, allowing them to cut interest payments by $0./boe. Montney operators saw interest rates climb in 01 as Canadian operators faced difficulty accessing new capital. $.0 Marcellus -1% Montney % Montney $

43 1 Canadian and U.S. Gas Producers Figure 7. s per boe Marcellus $1.10 $16. Both the Montney and Marcellus are low-cost plays. Higher liquids content in the Montney means higher supply costs, but Montney producers also receive the benefit of condensate sales in Alberta s high value market. Montney $17.6 $17.1 Marcellus -7% Montney 1%

44 Data Tables

45 Intermediate Producers Production (boe) s ($/boe) Company Name Location Baytex Energy Corp. Canada 78,9.00 8,68.00 $7. $7.16 Bellatrix Exploration Ltd. Canada 8, ,1.00 $9. $.19 Birchcliff Energy Ltd. Canada,7.00 8,90.00 $1. $16.1 Bonavista Energy Corp. Canada 77, ,88.00 $9.96 $. Lightstream Resources Ltd. Canada 0,0.00 1,9.00 $7.7 $8.8 Long Run Exploration Ltd. Canada 1,168.00,86.00 $6.1 $8.8 MEG Energy Corp. Canada 71, ,0.00 $6.08 $0.9 Paramount Resources Ltd. Canada,.00,10.00 $.9 $8.1 Pengrowth Energy Corp. Canada 7, ,09.00 $6. $9.1 Penn West Petroleum Ltd. Canada 10, ,7.00 $9.89 $7.78 Peyto Exploration & Development Corp. Canada 76,7.00 8,67.00 $1.68 $1.1 Seven Generations Energy Ltd. Canada 1, ,0.00 $.8 $.6 Trilogy Energy Corp. Canada, ,77.00 $7. $0.6 Vermilion Energy Inc. Canada 9,7.00,9.00 $0. $0.71 Whitecap Resources Inc. Canada,8.00 0,9.00 $0. $.71 Total 796, ,7.00 $608.6 $6.0 Average, ,16.87 $0.8 $6.0 Median 0,0.00,9.00 $7. $.71

46 6 Junior Producers Production (boe) s ($/boe) Company Name Location Advantage Oil & Gas Ltd. Canada 1,90.00,7.00 $11.7 $11. Anderson Energy Inc. Canada,11.00,90.00 $6.1 $8.88 Arsenal Energy Inc. Canada,00.00, $7.1 $9.1 Athabasca Oil Corp. Canada 6, ,60.00 $8.61 $70.08 BlackPearl Resources Inc. Canada 9, ,0.00 $8.9 $.7 Bonterra Energy Corp. Canada 1, ,66.00 $8. $.01 Cardinal Energy Ltd. Canada 7, ,88.00 $8.9 $0.68 Cequence Energy Ltd. Canada 10,9.00 9,8.00 $.6 $.6 Chinook Energy Inc. Canada 8,81.0,67.00 $9.8 $0.90 Crew Energy Inc. Canada, ,.00 $1.7 $.6 Delphi Energy Corp. Canada 10,9.00 9,69.00 $1.0 $6.9 Dundee Energy Ltd. Canada,8.00,06.00 $1. $8.18 DXI Energy Inc. Canada $9.9 $6. Gear Energy Ltd. Canada 6,00.00, $60. $7. Journey Energy Inc. Canada 10, ,09.00 $.97 $.87 Kelt Exploration Ltd. Canada 1, ,77.00 $.8 $.6 NuVista Energy Ltd. Canada 18,91.00,08.00 $6.00 $. Painted Pony Petroleum Ltd. Canada 1, ,60.00 $18.87 $11.89

47 7 Junior Producers Production (boe) s ($/boe) Company Name Location Perpetual Energy Inc. Canada 0,.00 19, $7. $.78 Questerre Energy Corp. Canada 1, ,8.00 $9. $8.0 Raging River Exploration Inc. Canada 10,7.00 1,71.00 $.68 $1.1 RMP Energy Inc. Canada 11, ,06.00 $.88 $.18 Rock Energy Inc. Canada,991.00,10.00 $8.9 $.07 Surge Energy Inc. Canada 18, ,6.00 $.01 $.6 Tamarack Valley Energy Ltd. Canada, ,8.00 $6.87 $.17 TORC Oil & Gas Ltd. Canada 11,6.00 1,88.00 $.0 $.9 Toscana Energy Income Corp. Canada,8.00,9.00 $1.18 $.1 Twin Butte Energy Ltd. Canada 1, ,0.00 $7.18 $. Yangarra Resources Ltd. Canada,870.00,9.00 $.06 $.1 Zargon Oil & Gas Ltd. Canada 6,119.,6.6 $66.19 $60. Total 00, ,6.6 $1,8.96 $1,101.9 Average 10,09. 10,0.79 $6.0 $6.7 Median 9, ,77.00 $8.9 $6.1

48 8 International Producers Production (boe) s ($/boe) Company Name Location Bankers Petroleum Ltd. International 1,0.00 1,1.00 $8. $0.9 BNK Petroleum Inc. International,78.00,8.00 $9.89 $7.6 Caza Oil & Gas Inc. International,6.00 7,.00 $77. $.17 Eagle Energy Inc. International 17,.00 1,7.00 $ $81.06 Gran Tierra Energy Inc. International,6.00, $79.7 $.68 Jura Energy Corp. International 6.6 1,89.8 $1.6 $0.6 Oando Energy Resources Inc. International 1, $9.89 $9.01 Oryx Petroleum Corporation Ltd. International 0, ,.00 $61.11 $.8 Parex Resources Inc. International,7.,660. $86.71 $6.7 Tethys Petroleum Ltd. International 10, ,.00 $8.0 $0. Touchstone Exploration Inc. International , $7.77 $10.77 TransAtlantic Petroleum Ltd. International 16, ,10.96 $91.8 $7. TransGlobe Energy Corp. International $67.01 $76. Valeura Energy Inc. International 6,760.,01.1 $0.68 $.77 Total 7, , $1,0. $8.0 Average 6, ,77.01 $7.10 $60. Median 10, ,08.70 $76.0 $6.1

49 9 Canadian and U.S. Gas Producers Production (boe) s ($/boe) Company Name Location Advantage Oil & Gas Ltd. Canada 1,90.00,7.00 $10.7 $10.8 Antero Resources Corp. International 167, ,7.1 $1.19 $1.0 Cabot Oil & Gas Corp. International,81. 7,18.86 $1.9 $1.97 Delphi Energy Corp. Canada 10,9.00 9,69.00 $.8 $.81 Painted Pony Petroleum Ltd. Canada 1, ,60.00 $17.0 $11. Range Resources Corp. International 19,79.0,69. $18.7 $16.1 Rex Energy Corp. International,71.00,67. $9. $7.19 Rice Energy Inc. International, ,99. $1.8 $16. Seven Generations Energy Ltd. Canada 1, ,0.00 $19.8 $0.0 Total 71, ,988.6 $16.6 $1.9 Average 8, , $18.9 $17.1 Median 1, ,0.00 $17.0 $16.1

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