Headwater Exploration Inc. · TSX:HWX
Headwater Exploration — Investor Presentation (August 2024)
25 slides from Headwater Exploration's investor presentation, August 2024
Slide 1: Headwater Exploration Inc. Corporate Presentation
Headwater Exploration Inc. CORPORATE PRESENTATION TSX:HWX August 2024
Slide 2: Capitalization, Guidance and Business Strategy
CAPITALIZATION, GUIDANCE AND BUSINESS STRATEGY Outlook Capitalization 2024 Current Average Daily Production Guidance (1) (2) Headwater Exploration Inc. TSX HWX Annual Daily Production (boe/d) 20,000 Share Price (July 25th, 2024) $/sh. $7.24 Fourth Quarter Daily Production (boe/d) 21,500 Shares Outst
Slide 3: Regional Clearwater Area
REGIONAL CLEARWATER AREA Total Land Holdings 531 net sections with 66.8 net sections added YTD 2024 Cadotte Evi Greater Peavine (Seal, Peavine) 53.6 sections (Net) 6 Locations planned for 2024 Nampa Multi-zone potential from Falher and Bluesky horizons Walrus Slave Seal Greater Nipisi (Heart River,
Slide 4: Headwater Exploration & Development Strategy
HEADWATER EXPLORATION & DEVELOPMENT STRATEGY 1,381 Identified Clearwater Area Locations Clearwater Area OOIP of 4.9 Billion Barrels 5 129 636 539 605 1,271 493 2,133 345 149 Marten Hills Core Marten Hills West West Nipisi Greater Peavine Bluesky Marten Hills Core Marten Hills West West Nipisi Greate
Slide 5: Marten Hills Core Production
MARTEN HILLS CORE PRODUCTION Secondary Recovery Performance Mitigates Decline Multi-Layer Support • A plot of historical performance in Marten Hills Core shows the impact of secondary recovery on both producing benches • Well count has been flat since February of 2023 • We have ~ 3,200 bbl/day of oi
Slide 6: Marten Hills Core Secondary Recovery
MARTEN HILLS CORE SECONDARY RECOVERY Continued Secondary Recovery Performance Multi-Layer Support Pilot injector supporting Two Bench Design Blue: Three Bench Design 02/12-08-075-24W5, 5,000 1,500 Oil (bbl/d) Green: Two Bench Design strong injectivity indicates Injection (bbl/d) secondary recovery c
Slide 7: Marten Hills West Secondary Recovery
MARTEN HILLS WEST SECONDARY RECOVERY Marten Hills West Pilots – Utilizing Marten Hills Core Learnings Section 07-076-02W5 Pattern 1,200 2,400 Oil (bbl/d) Injection (bbl/d) 2024 Secondary Recovery Expansion GOR (scf/bbl) Completed in March 2024 1,000 2,000 800 1,600 Rate (bbl/d) GOR (scf/bbl) 600 1,2
Slide 8: Marten Hills West – Clearwater Sandstone
MARTEN HILLS WEST – CLEARWATER SANDSTONE Continued Step-out Success; Continuing Secondary Recovery Clearwater A Sandstone MHW Secondary Recovery Section 07-076-02W5 • Full section implementation • First Marten Hills West full section secondary recovery on injection • Step-out tests to the Northwest,
Slide 9: Marten Hills West Exploration
MARTEN HILLS WEST EXPLORATION Multi-Zone Clearwater Potential within Marten Hills West 00/14-19-076-02W5 CLWT F Strong inflow with high water cuts Multiple Clearwater Zones Up-dip winter access follow up 00/04-35-076-02W5 CLWT E CLWT G planned for Q1 2025 IP15: 155 bbl/d @ 24 API Shut in mid March f
Slide 10: Greater Peavine
GREATER PEAVINE Multiple Productive Falher Sands and Bluesky Prospect Test Seal FLHR B 03/08-08-083-15W5 00/08-08-083-15W5 FLHR B StingWray FLHR D StingWray IP30: 198 bbl/d IP30: 82 bbl/d FLHR C 02/07-07-083-15W5 FLHR B StingWray IP60: 146 bbl/d Land Acquisition 30% Net WI on 7 Sections FLHR D 04/13
Slide 11: Greater Nipisi – 130 Sections
GREATER NIPISI – 130 SECTIONS Clearwater Development & Multiple Clearwater Exploration Prospects Utikuma Heart River FLHR D follow-up Q4 2024 West Nipisi Little Horse CLWT C Strat Test 100/09-24-077-11W5 CLWT F Exploration CLWT G Exploration 100/05-18-077-11W5 102/05-15-077-12W5 IP5: 90 bbl/d @ 16.5
Slide 12: Handel – West Central Saskatchewan
HANDEL – WEST CENTRAL SASKATCHEWAN W3 Mannville Heavy Oil Exploration W3 Mannville Heavy Oil Large contiguous land block accumulated: • 57.75 Sections Lloyd test: 101/01-30-035-18W3: • Open-hole, single-leg horizontal • Encountered 1,000m of excellent quality reservoir across the lateral • Well plac
Slide 13: Clay
CLAY New Potential Growth Area – Exploration well planned for Q3 2024 Clay • McLaren Formation • 16 sections Marten Hills • Multi-lateral exploration well planned for Q3 2024 • Up to 23 mmbbl OOIP per section Perryvale HWX Land Clay 2024 Q3 HWX Drill See Slide Notes and Advisories 12
Slide 14: Why Headwater
WHY HEADWATER Add incremental prospects through strategic land acquisitions and M&A •Added 66.8 sections of Clearwater lands YTD 2024, total Clearwater lands now exceeding 531 net sections •Added 36.7 sections of non-Clearwater lands YTD 2024, total Non-Clearwater lands now exceeding 192 net section
Slide 15: Appendix
Headwater Exploration Inc. Appendix TSX:HWX
Slide 16: McCully Producing Asset
MCCULLY PRODUCING ASSET Dry Gas with 100% owned infrastructure and limited liability McCully Asset Daily Production 25.0 20.0 New Brunswick MNP pipeline Production mmscf/d 15.0 10.0 Nova Scotia 5.0 0.0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 HWX Realized
Slide 17: Experienced Team – Management and Directors
EXPERIENCED TEAM – MANAGEMENT AND DIRECTORS Headwater Exploration Inc. Neil Roszell, P. Eng. ▪ Former President, CEO and/or Executive Chairman and founder of Raging River Exploration Inc., Wild Stream Exploration Inc. and Executive Chairman Wild River Resources Ltd. Jason Jaskela, P. Eng. ▪ Former C
Slide 18: Slide Notes
SLIDE NOTES Slide 1 1. Assumptions used in the updated 2024 guidance as released on May 9, 2024 and reconfirmed on July 25, 2024 include: WTI of US$76.25, WCS of Cdn$83.88/bbl, AGT of US$5.11/mmbtu, AECO of Cdn$1.88/GJ, foreign exchange rate of Cdn$/US$ of 0.73, blending expense of WCS less $2.20, r
Slide 19: Forward Looking Statements Advisory
ADVISORIES Forward Looking Statements Advisory This investor presentation of Headwater Exploration Inc. ("Headwater") contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of Canadian securities laws. All statements other
Slide 20: Development Strategy Advisory
ADVISORIES Development Strategy Advisory Advisory Relating to Development Strategy (Slide 3) The Company has presented herein a two-year development strategy. The development strategy is based on a number of assumptions as presented in such slides including, without limitation: the required reinvest
Slide 21: Non-GAAP Advisory
ADVISORIES Non-GAAP Advisory NON-GAAP MEASURES AND RATIOS Non-GAAP Financial Measures This investor presentation contains the terms “adjusted funds flow from operations (“AFFO”) or Atax funds flow”, Capital expenditures or capital program “adjusted working capital”, “capital expenditures or capital
Slide 22: Non-GAAP Advisory
ADVISORIES Non-GAAP Advisory Non-GAAP Ratios Reinvestment Rate Management believes the reinvestment rate is a useful measure to analyze the ratio of funds generated by the Company and used for reinvestment and is calculated as total capital expenditures divided by AFFO. Post dividend free cash flow
Slide 23: Certain Oil and Gas Advisories
ADVISORIES Certain Oil and Gas Advisories TYPE CURVE INFORMATION AND WELL ECONOMICS Headwater has presented certain type curve information and well economics for certain development, exploration and waterflood wells in the Clearwater area. The type curve information and well economics presented are
Slide 24: Certain Oil and Gas Advisories
ADVISORIES Certain Oil and Gas Advisories BARRELS OF OIL EQUIVALENT The term "boe" or barrels of oil equivalent may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 Mcf: 1 bbl) is based on an energy
Slide 25: Certain Oil and Gas Advisories
ADVISORIES Certain Oil and Gas Advisories MARKET, INDEPENDENT THIRD PARTY AND INDUSTRY DATA ADVISORY Certain market, independent third party and industry data contained in this presentation is based upon information from government or other independent industry publications and reports or based on e
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