Southern Energy Corp. · TSXV:SOU
Southern Energy — Investor Presentation (April 2023)
23 slides from Southern Energy's investor presentation, April 2023
Slide 1: Uniquely Positioned to Deliver Sustainable Growth
Uniquely Positioned to Deliver Sustainable Growth Corporate Presentation April 2023 TSXV : SOU
Slide 2: Well Positioned for Significant Corporate Growth
Well Positioned for Significant Corporate Growth High quality assets receiving premium North American pricing SOUC, SOU.V, SOUTF • Premium natural gas pricing above NYMEX (Henry Hub), oil receives LLS pricing Trading Symbols AIM, TSXV, OTCQX • Low risk, high return drilling inventory across existing
Slide 3: Focused on Value Creation through Accretive Growth
Focused on Value Creation through Accretive Growth Acquisition Opportunities Organic Development Growth Focus Area Strong Base Production ✓ Disciplined consolidation strategy ✓ Large scale, under-developed assets & Asset Optimization with low historic recovery from utilizing management’s proprietary
Slide 4: Q1 2023 Activity Update
Q1 2023 Activity Update 2023 Gwinville Development Program re-start based on gas prices Balance Sheet Strength Seven wells have been successfully Three well pad drilled & completed Methodically paying down debt while drilled in the current program Four drilled & uncompleted “DUCs” expanding availabl
Slide 5: Year-End 2022 Reserve Summary
Year-End 2022 Reserve Summary 2022 marked another year of material organic reserves growth for Southern in all categories Net Present Company Reserves (1) 30,000.0 Value Before Income Total Oil Equivalent % Gas Taxes, Discounted > 60% Increase in 2P NPV10 (Mboe) at 10%/year 25,000.0 Reserves Categor
Slide 6: Gwinville Horizontal Redevelopment Appraisal Program
Gwinville Horizontal Redevelopment Appraisal Program Appraisal Program Results • Successfully drilled 10 horizontal laterals in three separate reservoirs to delineate resource Selma Chalk Structure • Achieving pacesetter wells and associated cost efficiencies with larger program • Gathering key rese
Slide 7: Gwinville 2023 Development Program
Gwinville 2023 Development Program 1 mile 18-10 Pad Upper Selma Chalk Lower Selma Chalk • 18-10 #2 Upper Selma Chalk: City Bank ‒ Complex faulting resulted in only ~ 50% of the lateral drilled in high-grade porosity 2023 Pad ‒ 4,699’ lateral (2,538’ effective) fractured with 43 stages ‒ Well achieve
Slide 8: Selma Chalk Well Updates
Selma Chalk Well Updates Selma Chalk Production Update (1) Preliminary 2023 Program Results 0.40 Gen II Type Well 0.35 Gen 1 Avg. BCF / 1000’ Effective Lateral 1 Successfully drilled 5 HZ Selma Chalk wells 0.30 SOU AVG NORM. GH 19-3 2 0.25 Executed on or under budget GH 19-3 3 0.20 GH 19-3 4 0.15 GH
Slide 9: 2023 Uncompleted Well Expectations
2023 Uncompleted Well Expectations Technical Improvements Utilizing technology to increase in-zone lateral length Q1 2022 4 95% 5,400 DUC Wells Avg. In-Zone Lateral Avg. Lateral length Q1 2023 Longer Laterals Results Longer in-zone laterals are • Average effective length is 20% longer than type expe
Slide 10: Organic Development Activity Driving Growth
Organic Development Activity Driving Growth Significant Gwinville Growth Model – Selma Chalk Only Significant Growth Opportunities Based on Generation 2 type curve results Conservative single rig program < 8 months/year (15 wells) Multiple Development Opportunities 25,000 Across Mississippi Asset Ba
Slide 11: Eight Years of Operating History Has Formed Strategic Advantage
Eight Years of Operating History Has Formed Strategic Advantage Strategic Advantage Consolidation & Development Focus Area • Self-generated opportunities utilizing proprietary database • Digital workflow has proven management successful in previous companies Oklahoma • Significant amount of work com
Slide 12: Tightening of the U.S. Gas Supply / Demand Balance
Tightening of the U.S. Gas Supply / Demand Balance Positioning Southern for the Future of Natural Gas Southern Proximity to Expanding LNG Export Markets The Short Term: 2023 price volatility • Lack of winter weather, Freeport LNG delays and Q4 ‘22 supply growth • 2023 major gas producer capital budg
Slide 13: Investment Thesis
Investment Thesis Why Invest in Southern Energy? Experience TEAM HAS 8 YEARS OPERATING HISTORY IN THE U.S. GULF COAST AREA • Highly experienced management team with proven track record • Extensive operations experience in southeastern U.S. core area SOUTHERN IS 7% INSIDER OWNED (NON-DILUTIVE BASIS)
Slide 14: Appendix
Appendix TSXV: SOU, AIM: SOUC, OTCQX: SOUTF www.southernenergycorp.com 13
Slide 15: Mississippi Oil & Gas History – Home of Core Assets
Mississippi Oil & Gas History – Home of Core Assets Mississippi Oil & Gas Highlights > 2.0 > 10 > 34,000 Billion bbl cumulative oil Tcf cumulative gas Wells drilled to date • Significant hydrocarbon recovery – Superior production on a per well basis than Texas or Louisiana • First commercial oil wel
Slide 16: Core Southern Energy Mississippi Asset Base
Core Southern Energy Mississippi Asset Base > 29,000 Acres ~ 2,900 boe/d $142.5 MM < $5.00/boe (> 97% HBP) Current Production (1) 2P PV10 (2) All-In Lifting/Processing Cost Mechanicsburg Magee Mississippi • Liquids rich (> 25 bbl/MMcf oil & NGL) 350 35 • Field production > 10 MMbbl • Field covered b
Slide 17: Gwinville – Large Scale Natural Gas Redevelopment
Gwinville – Large Scale Natural Gas Redevelopment Significant Underdeveloped Gas Resource Gwinville Field – Jefferson Davis County, MS • 1+ Tcf OGIP in Selma Chalk, current recovery ~ 15% Multi Tcf Gas in Place Bcf MMbbl • Multi-zone production of 1.5 Tcf, 12 MMbbl, historical decline Wilcox 1 0.0 <
Slide 18: Leadership Team
Leadership Team Experienced and successful management team with a history of creating shareholder value together Strong technical expertise combined with a modern approach to data and workflow creates proven early mover advantage Ian Atkinson Calvin Yau Gary McMurren Erin Buschert Jim McFadyen Jeff
Slide 19: Board of Directors
Board of Directors Experienced and talented leadership to guide the Execution of Southern Energy’s Business Plan Board of Directors Special Advisor Ian Atkinson, P. Eng., ICD.D Bruce Beynon, P. Geol. (Chairman) Jay D. Haber Former founder and EVP of Athabasca Oil Former EVP, Exploration and Corporat
Slide 20: Modern Energy Company - Environment, Social & Governance
Modern Energy Company - Environment, Social & Governance Southern’s near term mission is to support the U.S. transition to cleaner sources of electricity generation by delivering low cost, conventional natural gas Central Mississippi Operations Team Core Values at Southern – Not Buzz Words Environme
Slide 21: Disclaimers
Disclaimers General The information contained herein has been provided solely for information purposes and does not purport to be comprehensive or contain all the information that may be required by recipients to evaluate Southern Energy Corp. ("Southern" or the "Company"). This Presentation and the
Slide 22: Disclaimers
Disclaimers FOFI This Presentation contains future-oriented financial information and financial outlook information (collectively, "FOFI") about Southern's prospective results of operations, production, investor yields, working capital, capital expenditures, enterprise value, share price, investment
Slide 23: Disclaimers
Disclaimers Specified Financial Measures In this Presentation, certain key metrics, performance indicators, and industry benchmarks are used to analyze financial and operating performance. These performance indicators and benchmarks are used by Southern as key measures of profitability, and provide