Spot AECO $Cdn/GJ. 1 2 Daily Index Values; Rolling 12-Month History. 90 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17. $US/$Cdn $0.90 $0.85 $0.

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1 July, 17 Chart Watch ARC Energy Charts Visit for more information on this publication and the Institute The CAD hit over $US.77 US crude oil production fell MB/d in April Crude oil inventories rose slightly last week The US oil rig count fell by last week The US gas storage injection was below average Spot WTI Crude $US/B. Edmonton Light $US/B Spot Henry Hub Spot AECO $Cdn/GJ Spot AECO Basis Currency $US/$Cdn á 3.1 á.9 á.9 1. á.7715 á á Indexed to Months Ago Broad Equity Markets Year-to-Date 1 Daily Index Values; Rolling -Month History Shanghai Composite S&P/TSX Composite Dow Jones US stocks have outpaced Canadian stocks this year as......energy has underperformed. The DJIA is up by % on......the year, while the S&P/TSX Composite has been flat. Indexed to Months Ago Performance of Oil and Equities Year-to-Date Daily Index Values; Rolling -Month History 9 US and Cdn E&Ps gained.1% and.3% on the week. ARC Junior E&P Index S&P 5 E&P This was significantly less than the 7.5% gain in WTI. S&P/TSX E& P Index 9 Jun-1 Aug-1 Oct-1 Dec-1 Feb-17 Apr-17 Jun-17 Broad market indices are one the many vital signs measuring the health of the economy. Energy demand is a function of economic health., ARC Financial Corp. Jun-1 Aug-1 Oct-1 Dec-1 Feb-17 Apr-17 Jun-17 Performance of Canadian and US oil & gas equities are compared against each other., ARC Financial Corp. Oil & Service Equities Year-to-Date 3 Daily Index Values; Rolling -Month History Canadian Currency Exchange Daily Close Values; Rolling -Month History Indexed to Months Ago 1 1 Philadelphia Service I ndex PSAC Cana dian In dex $US/$Cdn $.9 $.5 The CAD is over $US.77 for the first time since Sept. On July th the Bank of Canada will announce its latest decision......on its benchmark interest rate. The expectation is that they will raise interest rates. $. 1 $.75 $.7 Jun-1 Aug-1 Oct-1 Dec-1 Feb-17 Apr-17 Jun-17 The performance of Canadian oil and gas service equities are plotted in tandem with the corresponding US index., Petroleum Services Association of Canada $.5 Jul-15 Nov-15 Mar-1 Jun-1 Oct-1 Feb-17 Jun-17 Much of Canada s oil and gas production is sold in US dollars. As such, the exchange rate significantly impacts corporate revenues and profits. Please see Advisories and Disclaimers at the end of the publication for important cautionary advisory and disclaimer language 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts 1

2 July, 17 Crude Oil 5 WTI Crude Oil Price and Differential to Brent Near-Month WTI and Brent Differential; Rolling -Month History WTI ($US/B) 5 WTI Diff WTI WTI Dif f to Brent ($US/B) 5 5 US Crude Oil Futures West Texas Intermediate (WTI) 17 to 19 Since the OPEC WTI $US/B meeting in May...contango in the 17 there has been a oil market. 5 steepening... 1 July 3, WTI gained more than $3/B last week, coming off of......a 1-month low. 1 1 Jun-1 Aug-1 Oct-1 Dec-1 Feb-17 Apr-17 Jun-17 North American crude oil prices can sometimes disconnect from global prices depending on regional supply and demand dynamics. Forward prices for WTI are plotted against months in the calendar year. Years are distinguished by color and symbol coding. Canadian Heavy Oil Price Differential to WTI Western Canadian Select (WCS) Differential; Rolling -Month History 7 Canadian Light Crude Oil Price Differential to WTI WTI and Edmonton Light differential; Rolling -Month History WCS ($US/B) 5 3 WCS Diff. WCS WCS rose 11% last wk as WTI gained and the diff tightened. WCS Dif f to WTI ($US/B) Edm. Light ($US/B) Edm. Light Diff. Edmonton L ight 5 3 Edm. Light Dif f to WTI ($US/B) Jun-1 Aug-1 Oct-1 Dec-1 Feb-17 Apr-17 Jun-17 Canadian heavy crude oil differentials are becoming less volatile with growing access to new markets via pipeline and rail. Jun-1 Aug-1 Oct-1 Dec-1 Feb-17 Apr-17 The differential should reflect the transportation cost from Alberta to Cushing. Greater discounts can result from infrastructure or refinery outages. Ratio of Long to Short Contracts - WTI Managed Money - Futures and Options 9 1 Total US Oil Production Monthly; 1 to Present Long:Short 1 1 Net WTI longs held by managed money fell last week. Short positions rose by 7% to a 1 month high. 1 EIA data for April came out on Friday, showing a... Offshore Oil Production Onshore Oil Production...reduction in US oil production of MB/d. This was driven by offshore reductions, as...production onshore... rose by 77 MB/ d. Jul-15 Oct-15 Jan-1 Apr-1 Jul-1 Oct-1 Jan-17 Apr-17 This represents the relative bullishness of money managers on the price of oil in the United States., U.S. Commodity Futures Trading Commission The advancement of drilling and completion methods boosted US crude oil production, prior to the downturn in prices., U.S. Energy Information Administration 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts

3 July, 17 Crude Oil Alberta Oil Production Monthly; Conventional and Oil Sands Upgraded Oil Sands Non-Upgraded Oil Sands Conventional 3 33 Early reports are that Libyan crude oil production has... OPEC Oil Production Monthly; Rolling -Month History...risen to almost 9, B/d, nearly three times the......production level of a year ago. July 3, According to the IEA, Canadian total oil production fell......by 3 MB/d in March. MB/d of this drop was the......result of a drop in Alberta oil sands output Libya is exempt from the OPEC cut agreement.. Feb- Feb-13 Feb-1 Feb-15 Feb-1 Feb-17 Most of Canada s oil production comes from Alberta; split between oil sands and conventional production. Source: Alberta Energy Regulator May- May-13 May-1 May-15 May-1 May-17 OPEC s production levels relative to its sustainable and spare capacity influences global crude prices. Source: Petroleum Intelligence Weekly Global Oil Supply-Demand Balance Quarterly; 1 to Present 13 1 Official Q data from the IEA is not out yet, but they are......indicating that the implied deficit is.5. Shortfall Oversupply Negative numbers indicate a global crude shortfall, while positive numbers indicate an oversupply. Source: International Energy Agency US Crude Oil Imports Prior to the downturn, growing domestic supply was displacing crude oil imports. Crude oil imports for the current year are in blue. 15 US Weekly Crude Oil Imports from Canada Pipeline, Tanker and Barge Crude Imports; Rolling -Month History 1 US Exports of Crude Oil and Refined Products Weekly Data; 13 to Present Crude oil imports from Canada have risen by 9 MB/d so Jun-15 Oct-15 Feb-1 Jun-1 Oct-1 Feb-17...far this year. Cdn imports now make up % of total imports. Crude oil imports from Canada are taking market share from overseas imports Crude Oil Refined Products. Jan-13 Jul-13 Jan-1 Jul-1 Jan-15 Jul-15 Jan-1 Jul-1 Jan-17 The US exports more refined products than crude oil. If/when tight oil growth resumes, most export growth should come from crude oil exports. 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts 3

4 July, 17 Crude Oil 17 US Crude Oil Stocks 1 MMB MMB 1,75 OECD Total Industry Oil Stocks Americas and Rest of OECD; to Present This chart is still showing April IEA storage data. When May/June data is released it is expected to show draws July 3, OECD Americas* 5 1,5 35 US crude oil inventories grew by. MMB on the week. Stocks are now 13 MMB over last year, and 17 MMB over......the 5-year average. 1,5 Other OECD 3 US crude oil stock levels can affect crude oil prices. Stock levels for the current year are represented by the blue line. 1, Jan- Jan-13 Jan-1 Jan-15 Jan-1 Jan-17 Global oil stock levels can affect crude oil prices *Includes U.S. (~9%), Canada, Mexico and Chile. Source: International Energy Agency 19 % 1 95 US Weekly Refinery Utilization Rates (%) US Motor oline Consumption 9 5 US refinery utilization has pulled back to typical levels. Utilization in Q averaged 93.3% versus the 5- year average......for Q of 9.5%. 75 Refinery utilization rates change the supply of refined products, impacting price. Utilization for the current year is blue oline consumption in the last two months has been 17 MB/d......below last year, but well above the 5- year average. 7.5 oline consumption accounts for almost half of all oil use in the US. oline consumption for the current year is represented by the blue line. US Oil Drilling Activity Baker Hughes Horizontal Oil Rig Counts; 1 to Present 1 Daily NGL Prices as a % of Edmonton Light Propane & Butane Spot Prices at Edmonton, AB # of Oil Rigs - Play Lev el Total US (Right-Axis) Permian Eagle Ford Bakken Cana Woodford # of Oil Rigs - Total The US oil rig 1 count fell after 3 straight 1 weeks of gains. There are still 75 rigs drilling. 1 Up from the low of Jan-1 Jul-1 Jan-15 Jul-15 Jan-1 Jul-1 Jan-17 Tracking US oil drilling by major play provides insight into the composition of US oil supply and growth trends. Source: Baker Hughes % of Edm. Light 1 % 1% % 1 % % % % % % Cond ensate Butane (Spot) Propa ne (Spot) -% Jun-15 Oct-15 Feb-1 Jun-1 Oct-1 Feb-17 Jun-17 Natural gas liquids have become critical contributors to producer s cash flow. Prices are influenced by the price of oil as well as local supply and demand., ARC Financial Corp. 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts

5 July, 17 Natural 3 Near-Month North American Natural Prices Daily Prices; Rolling -Month History $. $ $3. $ $. $ $1. $.5 AECO $C/GJ prices rose last week driven by a warmer Henry Hub weather outlook. closed the week at $.9/ MMBtu. Henry Hub Differential $. Jul Sep 3 Dec 9 Mar 9 Jun 7 Near-month prices at AECO track Henry Hub prices, the exchange rate and the cost of transportation. Local factors can also affect price US Natural Futures Nymex (Henry Hub) 17 to 19 July 3, Forward contract prices are plotted against months in the calendar year. Years are distinguished by color and symbol coding. 5 Ratio of Long to Short Contracts Henry Hub Managed Money Futures and Options Canadian Natural Futures AECO Hub (Bloomberg Estimate) 17 to 19 Long:Short The long:short ratio among Managed Money rose after......five straight weeks of decreases. $C/GJ Jul-15 Oct-15 Jan-1 Apr-1 Jul-1 Oct-1 Jan-17 Apr This represents the relative bullishness of money managers on the price of natural gas in the United States. Source: U.S. Commodity Futures Trading Commission AECO forward prices mimic Henry Hub futures plus a differential Global Natural Prices Japanese LNG, UK NBP, Henry Hub; Average Monthly Prices Japanese LNG UK NBP Henry Hub Jun- Jun-13 Jun-1 Jun-15 Jun-1 $5 $ $3 $ $1 US Coal and Natural Power Generation Cost Converted to a $/MWh Equivalent $US/MWh Henry Hub Appalachian Coal $ International natural gas prices strongly impact the economics of proposed LNG projects., Japanese Ministry of Economy, Trade and Industry This graph illustrates when it may be economic to begin coal-gas switching in power generation. Average power plant efficiencies are assumed. 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts 5

6 July, 17 Natural 9 Closing Closing Spot Spot Prices Prices at at North North American American Natural Natural Hubs Hubs Superimposed on Relative Pipeline Flows Superimposed on Relative Physical Volumes Traded July 3, AECO US$1.7 Kingsgate US$.1 Stanfield US$.1 Malin US$.3 Socal US$3. All prices in Opal US$. San Juan US$.3 Permian US$. Ventura US$.1 \ Chicago US$.7 The Rover Pipeline has been delayed due to environmental... Henry Hub US$.9 Dawn US$.7 Waddington US$.91 TGP Zone - Marcellus US$1.9...issues during construction, and likely won t meet the......original timeline of November 17. The pipe is proposed to transport Appalachian gas. Boston US$ North America has an integrated natural gas market. Prices are determined by regional supply and demand, and pipeline flows Pipeline Flows Out of Western Canada Daily; US Natural Exports Excluding Canada Daily; 17 Overall US exports have averaged.1 Bcf/d Most of this gain (1. Bcf/d) over last year. has come from LNG exports. 7 The ability of gas producers to move gas out of the WCSB to eastern markets and the US is a major factor in local natural gas prices. Source: Various Pipeline Companies 1.. Between exports to Mexico and LNG shipments, the US is growing as a natural gas exporter. Robust US supply growth has driven this trend. Source: Bentek 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts

7 July, 17 Natural 3 33 CDDs 1 Temperatures cooled down in much of the US last week, but US Weekly Cooling Degree Days Source: NOAA...the near term outlook is for a return to hot weather Week US Total Natural Demand Daily; July 3, Weekly natural gas demand is directly tied to the weather. The current year is in dark blue. Source: National Oceanic and Atmospheric Administration Total US demand fluctuates between Bcf/d in the summer and over 1 Bcf/d in the winter. Weather is the most important driver of consumption. Source: Bentek Total US Dry Natural Production 3 35 Daily Western Canadian Production Estimated Using Major Pipeline Receipts US natural gas production hit a 17 high on Thursday US production started ramping up in late 7 and continues to grow year over year. Source: Bentek WCSB receipts have recovered in the last two weeks following.....reduced flows on the TransCanada system. This includes receipts on the TCPL, Alliance, WestCoast and Trans pipelines. Source: Various Pipeline Companies 3 37 Bcf (5) (1) (15) () (5) (3) Weekly US Natural Storage Net Change Weekly Injection or (Withdrawals); 9 to Current 17 US gas storage grew by Bcf last week; below typical levels. (35) Tcf Total Working Natural in US Storage With a below typical injection last week, total storage is now Bcf below last year and 11 Bcf above the 5- yr avg..5 Weekly gas storage reports provide a snapshot of supply and demand. Current year changes are represented by the blue line. The EIA reports changes in US natural gas inventories held in underground storage facilities on a weekly basis. 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts 7

8 July, 17 Natural and Other Indicators Alberta Natural Demand 3 39 TransCanada Intra-AB Deliveries; Current Year and Historical Tracks Alberta gas 7. demand so far...5 Bcf/d.5 17 this year has above last year. averaged.... Much of this has 5.5 been driven by increased oil 5. sands production Alberta natural gas demand has grown steadily in recent years, largely driven by new oil sands projects coming on line. Source: TransCanada Pipelines Bcf Western Canadian Natural Storage Levels Weekly; Current Year and Historic Tracks 17 July 3, Canada s natural gas storage level provides a good metric if the country is well stocked. Abnormally high or low storage can affect the basis. Weekly Canadian Oil and Drilling Activity Baker Hughes Average Rig Counts; Rolling -Month History 1 US Drilling Activity Baker Hughes Horizontal Rig Counts; 1 to Present # of Rigs The total Canadian rig count rose, as we exit spring breakup. According to the CAODC, in the week ending June there... Rigs...were 17 rigs drilling, with a utilization rate of 7%. Oil Rigs # of Rigs - Play Lev el 1 1 Marcellus Haynesville Eagle Ford The US gas rig count rose by 1 rig last week; up to 1. # of Rigs - Total Total US (Right Axis) Jul-15 Nov-15 Mar-1 Jul-1 Nov-1 Mar-17 Unlike US drilling activity, Canadian rigs are dispatched seasonally. Capital allocation by operators is driven by views of future oil and gas prices. Source: Baker Hughes Jan-1 Jul-1 Jan-15 Jul-15 Jan-1 Jul-1 Jan-17 Tracking US gas drilling by major play provides insight into the composition of US gas supply and growth trends. Source: Baker Hughes Alberta Crown Land Sales Excluding Oil Sands Year-over-Year; Cumulative 3 $ Billions Land prices are an important component of F&D costs. In Alberta, sales of petroleum and natural gas rights are held every two weeks. Source: Alberta Department of Energy Well Completions (s) Canadian Cumulative Well Completions Current Year vs Years Prior Well completions so far this year have been tracking % above last year; an increase of 93 wells so far Week Relative year-over-year drilling activity is highlighted in this chart. Cumulative well completions for the current year are shown in blue. Source: Daily Oil Bulletin/JWN ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts

9 July, 17 Canadian Industry Metrics The B.C Liberal Government was defeated in a confidence......vote in the legislature late Thursday afternoon. NDP leader John Horgan will become the next premier of B.C. Estimated Capital Flow in the Canadian Oil and Economy for 17 Industry Revenue, Cash Flow, Reinvestment, Drilling Activity and Production $C 1.35 per BOE Oil & Prices 7.1 Million BOE/day Production Volume $C 1.7 Billion E&P Revenue Capital Flow in the Canadian Oil and Economy G&A Royalties & Taxes Operating Expenditures Cash Flow $C 3. Billion CAPEX Exploration & Development Foreign Investment and Capital Outflow Dividends and Distributions Debt, Equity $C. Billion July 3, Reserve Additions 5,5 Wells Drilling Activity Service Sector Revenue Land, Acquisitions Canadian Industry Statistics: Historical Data and Forecast Canadian Industry Metrics P rice P ro ductio n Vo lume C apital Inflo w R einvestment D rilling Well Split Average Price Edmonton Par AECO Conv. Liquids Bitumen + Synthetic Natural Total Volume Total Revenue After-tax Cash Flow Conv. Oil and Oilsands Reinvest Ratio Wells Compl. Avg Rig Utiliz. Oil Wells Wells $/BOE $C/B $C/GJ Average M BOE/d Average M BOE/d M BOE/d M BOE/d (@ :1) (@ :1) $C millions $C millions $C millions $C millions x:1 #/ Year % % % ,99 1,7,7 5, 15,5 3,55 3,93 1, ,77 1% 3% 5% , 1,331,51 5,3 9,57 3,,335 11,7.91,3 5% 1% 51% ,3 1,3,3 5, 11,5 3,59 35, 17, ,119 % 5% % ,73 1,,3 5,7 115,9 53,,139,91 1.1,7 5% 9% 31% ,95 1,73,37 5, ,39,9 39,733 7, ,7 % 3% 17% ,3 1,9,33,3,77 5,711 3,15 3, ,71 % % 1% ,,13,5,9 19,53 71,,7 33, 1. 11, 5% 7% % ,93,373,79,35,17,19 3,551,9. 5,3 % 9% 31% e ,91,393,95,9 7,7,,53 1,9 1.7, 17% 7% 3% 17e ,,55,5 7,7 1,73 3,79 9,131 13,.97 5,5 % 7% 3% Advisories and Disclaimers: This document is provided for informational purposes only and none of the information contained herein is intended to provide, nor should be construed as, investment, financial, legal or other advice and should not be relied upon as such. Certain of the information and data contained herein has been obtained or prepared from publicly available documents and other sources prepared by third parties, and ARC has relied upon such information and data. ARC does not audit or independently verify such information and data and ARC makes no representations or warranties as to the accuracy or completeness of such information and data nor the conclusions derived therefrom. This document has been published on the basis that ARC shall not be responsible for, and ARC hereby expressly disclaims any responsibility or liability for, any financial or other losses or damages of any nature whatsoever arising from or otherwise relating to any use of this document. Certain information contained herein may constitute forward-looking information and forward-looking statements" (collectively, "forward-looking statements") under the meaning of applicable Canadian securities laws. Forward-looking statements include estimates, plans, expectations, intentions, opinions, forecasts, projections, guidance or other statements that are not statements of fact, including but not limited to global and industry economic conditions and policies, production, demand and commodity prices. Although ARC believes that the assumptions underlying and expectations reflected in such forward-looking statements are reasonable, it can give no (and does not give any) assurance that such assumptions and expectations will prove to have been correct. Such forward-looking statements involve known and unknown risks, uncertainties and other factors outside of ARC's control that may cause actual results to differ materially from those expressed herein. Neither ARC nor any of its affiliates undertakes any obligation to publicly revise such forward-looking statements to reflect subsequent events or circumstances, except as required by law. 17 ARC Energy Research Institute. All Rights Reserved. ARC Energy Charts 9