061410 Investor Update

  • View
    160

  • Download
    0

Embed Size (px)

Transcript

  • Investor UpdateJune 2010

  • Thispresentationisforinformationpurposesonlyandisnotintendedto,andshouldnotbeconstruedto,constituteanoffertosellorthesolicitationofanoffertobuysecuritiesofPennWest.

    DiscoveredPetroleumInitiallyInPlace(DPIIP)isequivalenttoOriginalOilInPlace(OOIP).DPIIP,alsoknownasa"discoveredresource",isdefinedasthat quantityofpetroleumthatisestimated,asofagivendate,tobecontainedinknownaccumulationspriortoproduction.Therecoverableportionofdiscoveredpetroleuminitiallyinplaceincludesproduction,reservesandcontingentresources;theremainderisunrecoverable.Arecoveryprojectcannotbedefinedforthisvolumeofdiscoveredpetroleuminitiallyinplaceatthistime.Thereisnocertaintythatitwillbecommerciallyviabletoproduceanyportionoftheresources.

    CertaininformationregardingPennWestEnergyTrustandthetransactionsreviewedinthispresentationincludingmanagementsassessmentoffutureplansandoperations,mayconstituteforwardlookingstatementsunderapplicablesecuritieslawandnecessarilyinvolverisks,including,without limitation,risksassociatedwith oil and gas exploration, development, exploitation, production,marketing and transportation, loss of markets, volatility of commodity prices, currencyfluctuations,imprecisionofreserveestimates,environmentalrisks,competition,incorrectassessmentofthevalueofacquisitions,failuretorealizetheanticipatedbenefitsofacquisitionsandabilitytoaccesssufficientcapitalfrominternalandexternalsources;failuretoobtainrequired regulatoryapprovals.Asaconsequence,actual resultsmay differmaterially from those anticipated in the forwardlooking statements. Readers are cautioned that the foregoing list of factors is notexhaustive.Additional informationon theseandother factors thatcouldaffectPennWestsoperationsor financial resultsare included in reportson filewithCanadiansecuritiesregulatoryauthoritiesandmaybeaccessedthroughtheSEDARwebsite(www.sedar.com),oratPennWestswebsite(www.pennwest.com).

    Thispresentationand itscontentsshouldnotbeconstrued,underanycircumstances,as investment, taxor legaladvice. Anypersonacceptingdeliveryof thispresentationacknowledgestheneedtoconducttheirownthorough investigationintoPennWestbeforeconsideringanyinvestmentinitssecurities.Furthermore,theforwardlookingstatementscontainedinthispresentationaremadeasof thedateofthispresentation,PennWestdoesnotundertakeany obligationtoupdatepublicly or to revise anyof the included forwardlooking statements,whether as a result of new information, future eventsor otherwise, except asmay beexpresslyrequiredbyapplicablesecuritieslaw.

    Wherereservesorproductionarestatedonabarrelofoilequivalent(BOE)basis,naturalgasvolumeshavebeenconvertedtoabarrelofoilequivalent(BOE)ataratioofsixthousandcubicfeetofnaturalgastoonebarrelof oil.Thisconversionratioisbaseduponanenergyequivalentconversionmethodprimarilyapplicableattheburnertipanddoesnotrepresentvalueequivalenceatthewellhead.BOEs maybemisleading,particularlyifusedinisolation.

    ThispresentationmaycontainreferencestononGAAPterms.PennWestusesthesemeasurestohelpevaluatetheir respectiveperformance.ThesemeasuresaspresenteddonothaveanystandardizedmeaningprescribedbyCanadianGAAPandtherefore,theymaynotbecomparablewithcalculationsofsimilarmeasuresforothercompaniesortrusts.

    AllreferencesaretoCanadianDollarsunlessotherwisespecified.

    Advisory

    2

  • 3YieldGrowth

  • Setting the Course for the Future

    4

    Capital budget of $700 to $800 million necessary to maintain current production levels

    Focus funds to increase pace of development in key play areas anticipate $150 to $200 million for organic growth

    Timing for conversion at year-end 2010

    Set dividend with objective to remain within funds flow for sustaining capital, growth capital and dividend

    Fine tune model for 2011 and provide guidance for capital plans during Q4 2010

    Conversion

  • 5producer of light & medium oil in western Canada

    #

  • 6Significant Light Oil PotentialSignificant Light Oil Potentialmillion acres

  • 7AdvantageInfrastructure

  • Oil Gas BOEProved 341 mmbbls 938 bcf 497 mmboe

    Proved and Probable 472 mmbbls 1,292 bcf 687 mmboe

    8

    %Proved OilReserves

    VerticallyBooked

    95%

  • Strategic Portfolio Management

    9

    Peace RiverOil Sands

    Wildboy

    Eastern Alberta

    Penn West land position

    Cardium

    WaskadaDodsland

    North CentralCarbonates

  • Prospect Inventory

    10

    Light Oil

    Gas

    Oil Sands

    Cumulative Resource

    Production

    14%

    2%

    0%

    Discovered Petroleum Initially in Place (DPIIP), is defined in the COGEH handbook as the quantity of hydrocarbons that are estimated to be in place within a known accumulation. DPIIP is divided into recoverable and unrecoverable portions, with the estimated future recoverable portion classified as reserves and contingent resources. There is no certainty that it will be economically viable or technically feasible to produce any portion of this DPIIP except for those identified as proved or probable reserves. At this time all of the DPIIP not classified as reserves would be classified as Unrecoverable Resources.

    OOIP / OGIP

    8.5 B bbls

    18 Tcf

    2.75 B bbls

    Incremental

    Recovery

    85 million bbls

    180 Bcf

    27.5 million bbls

    1%

  • 11

    Unlocking Oil in Place

    CardiumWest Central Alberta

  • West Central AB - Cardium

    bbls OOIP10 billion

    wells (net)2,400

    current production~25,000 boe/d

    880 sections (net)

    1.6 billion bbls recovered to date

    2 5 billion bbls potentialOOIP additions

    12Penn West land

    Pembina

    WillesdenGreen

    WestPembina

    Leafland

    Garrington

    Strachan

    Ferrybank

    BuckLake

    Vertically definedpool boundary

    Cardium trend

    20 miles

    30 kms

    Program Summary

  • Cardium Land Holding Existing

    13

    Source: Company reports, Scotia Capital estimates.

    530

    0

    100

    NetSections

    200

    300

    400

    500

    204160150150150

    100 95 92 81 75 66 52 49 47 40 40 38 30 23 19 17 17 9 8

    600

    700

    800

    PennWest

    2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

    880

    + Halo

  • Penn West land position

    Light Oil Resource Plays

    14

    Cardium

    net sections880 wellinventory2,000 +

    50 2010 net wells

  • Penn West land position

    Light Oil Resource Plays

    15

    Cardium

    Waskada

    net sections125 wellinventory1,000

    60 2010 net wells

  • Penn West land position

    Light Oil Resource Plays

    16

    Dodsland

    Cardium

    Waskada

    net sections280 wellinventory1,000

    70 2010 net wells

  • Penn West land position

    Light Oil Resource Plays

    17

    DevonianCarbonates

    Cardium

    Dodsland Waskada

    net sections300 wellinventory200 +

    25 2010 net wells

  • Unlocking Oil in Place

    Peace RiverCentral Alberta

    18

  • Peace River Oil Partnership

    19

    Strategic Rationale

    Establish key technical and financial relationship

    Increase pace of development

    (primary and thermal)

    Operate Peace River as a stand alone project

    reflecting its uniqueness in Penn West

  • Peace River Oil Partnership

    20

    Penn West contributes: 106,650 acres (45% of 237,000 acres)

    1,215 boe/d (45% of 2,700 boe/d)

    $56 million go forward investment (10% of PWTs 55% interest)

    Partner contributes:

    $312 million cash (paid to PWT directly)

    $505 million go forward investment (90% of PWTs 55% interest)

    $459 million capital (45% interest)

    Key Points

  • 21

    * Pro Forma debt at March 31, 2010 net of equity private placement and funds received from the formation of the Peace River Oil Partnership announced May 13, 2010.** On April 30, 2010 Penn West Petroleum Ltd. Closed the renewal of its unsecured revolving syndicated bank facility.*** All debentures expire prior to December 31, 2011 and can be settled with equity.

    Credit Capacity

    $1.75 billionundrawn**

    $500 million drawn*

    Total Debt

    PrivateDebt$1.6

    billionConvertibleDebentures***$273 million

    Bank Debt$0.5 billion

    Setting the Course for the Future

  • Stock ExchangeToronto: PWT.UNNew York: PWE

    Legal CounselBurnet, Duckworth & Palmer LLP

    Independent Reserves EvaluatorsGLJ Petroleum Consultants Ltd.Sproule Associates Limited

    Transfer AgentCIBC Mellon Trust CompanyToll Free: 1-800-387-0825Email: inquiries@cibcmellon.caWebsite: www.cibcmellon.ca

    Investor RelationsJason Fleury, Manager, Investor RelationsTelephone: (403) 539-6343Email: jason.fleury@pennwest.com

    Toll Free: 1-888-770-2633Email: investor_relations@pennwest.comWebsite: www.pennwest.com

    Penn West EnergySuite 200, 207 9th Avenue SWCalgary, Alberta, Canada T2P 1K3Telephone: (403) 777-2707Toll Free: 1-866-693-2707Facsimile: (403) 777-2699Website: www.pennwest.com