2022 Capital Markets Day - February 8, 2022 - Lundin Group of ...
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Capital Markets Day
2022
February 8, 2022
NC00243 01.2022
1
International Petroleum Corp.
Agenda
Capital Markets Day
February 8, 2022
Presenting today
1. Introduction Mike Nicholson
2. 2022 Outlook William Lundin
3. Asset Overview
3a. Canada Chris Hogue
Mike William Chris
3b. Malaysia William Lundin Nicholson Lundin Hogue
CEO COO SVP Canada
3c. France
4. Financial Overview Christophe Nerguararian
5. Reserves Valuation Rebecca Gordon
6. Conclusion Mike Nicholson Christophe Rebecca
Nerguararian Gordon
Q&A All CFO VP IR and Planning
NCF00244 p02 01.22
IPC CMD 2022 2
International Petroleum Corp.
2021 Highlights
Balanced
Above Guidance Production (1)
Low Operating Costs (2)
Capital Expenditure
45.5 Mboepd 15.0 USD/boe 48 MUSD
Record Cash Flow (2) Strong Balance Sheet (2) Increased Resources (3) Sustainability Focus
337 MUSD OCF Net debt MUSD94 91%
reserves
replacement Carbon reduction
offsets
&
263 MUSD FCF EBITDA Leverage 0.3x +300 MMboe 2C material
26% FCF Yield No incidents
1)
See Reader Advisory, including “Supplemental Information regarding Product Types” in “Disclosure of Oil and Gas Information”.
NCF00244 p30 01.22
2)
See Reader Advisory and the management’s discussion and analysis for the year ended December 31, 2021 (MD&A) available on IPC's website at www.international-petroleum.com and filed under IPC’s profile
on SEDAR at www.sedar.com, including “Non-IFRS Measures”. Free cash flow yield is based on IPC’s market capitalization at close February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million).
3)
As at December 31, 2021. See Reader Advisory and the material change report dated February 8, 2022 (MCR) available on IPC's website at www.international-petroleum.com and filed under IPC’s profile
on SEDAR at www.sedar.com, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 3
International Petroleum Corp.
Strongly Positioned to Create Stakeholder Value
2022-2026
178% Stakeholder Returns
95
USD
36% p.a. Debt reduction, share buybacks & dividends
>1,800 MUSD FCF (1,2,3)
M&A
~47
Mboepd (1)
4 transactions in 4 years
65 89%
USD 18% p.a. Organic Growth
>1.4 Billion boe of contingent resources (4)
>900 MUSD FCF (1,2,3)
1)
See Reader Advisory, including “Forward-Looking Statements” and “Supplemental Information regarding Product Types” in “Disclosure of Oil and Gas Information”. 2)
See Reader Advisory and MD&A, including “Non-IFRS measures”.
NCF00244 p19 01.22
3)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans over the period of 2022 to 2026. Assumptions include average net production over that period
of approximately 47 Mboepd, average Brent oil prices of USD 65 to 95 per boe escalating by 2% per year, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials as estimated
by IPC’s independent reserves evaluator and as further described in the MCR. Free cash flow yield is based on IPC’s market capitalization at close February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million). IPC’s current business
plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
4)
As at December 31, 2021, best estimate, unrisked. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 4
International Petroleum Corp.
2P Reserves Growth(1)
Net 2P Reserves and Production
(MMboe)
Eleven times 2P reserves growth since inception Granite 270
300
272
2P reserves of 270 MMboe 288
Reserves life index (RLI) of 16 years 275
BlackPearl
Reserves Life Index
(years) 1x
>1
YE 2016 8 129
YE 2021 16 Suffield 65.0
48.5
29 33.0
16.3
3.8
YE 2016 YE 2017 YE 2018 YE 2019 YE 2020 YE 2021
NCF00244 p05 01.22
Net 2P Reserves
Cumulative Production
1)
As at December 31, 2021. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 5
International Petroleum Corp.
Contingent Resources (1) Net Contingent Resources
(MMboe) 1,410
128
Material increase in contingent resource base to 1.4 billion boe 1,089 1,102
+300 MMboe in Blackrod contingent resources 102 115
849
Potential to mature resources in all countries
105
Canada - Blackrod pilot ongoing, FEED study in 2022
- Ferguson field development 1,283
Malaysia - Further infill drilling 987 987
- PSC extension 744
France - Build on horizontal drilling success
63
0
YE 2016 YE 2017 YE 2018 YE 2019 YE 2020 YE 2021
NCF00244 p06 01.22
Other
Blackrod
1)
As at December 31, 2021, best estimate, unrisked. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 6
International Petroleum Corp.
2022 Production Guidance (1)
2022 production guidance of 46,000 – 48,000 boepd
Investment strategy targeting growth in all regions Production Growth Through Time
Production in excess of pre COVID levels
50 46-48
46 46
Canada 42
40
Ferguson field development
Onion Lake Thermal production Pad L and infill drilling 34
Suffield N2N EOR flood expansion 30
Mboepd
International x
20 >4
A15 sidetrack drilling and ESP upgrades at Bertam field, Malaysia
Villeperdue West development in France 10
10
0
2017 2018 2019 2020 2021 2022
NCF00244 p07 01.22
1)
See Reader Advisory, including “Forward-Looking Statements” and “Supplemental Information regarding Product Types” in “Disclosure of Oil and Gas Information”.
IPC CMD 2022 7
International Petroleum Corp. 600-635
100 USD/bbl
Operating Cash Flow (MUSD) (1)
485-505
85 USD/bbl
360-375
71 USD/bbl
70 USD/bbl
64 USD/bbl
337
71 USD/bbl
308
279
220-230
55 USD/bbl
55 USD/bbl
42 USD/bbl
138
119
2017 2018 2019 2020 2021 2022 (2)
Actual Actual Actual Actual Actual Forecast
NCF00244 p09 01.22
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
2)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans. Assumptions include average net production of between 46 and 48 Mboepd, average Brent oil prices of
USD 55 to 100 per boe, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials as estimated by IPC’s independent reserves evaluator and as further described in the MCR. IPC’s current
business plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
IPC CMD 2022 8
International Petroleum Corp.
2022 CMD Investment Strategy
Focused on free cash flow generation (1)
Forecast 2022
Measured capital expenditure of 127 MUSD (2)
Capital Expenditure
Investment strategy targeting growth across all regions
Malaysia 24%
2022 expenditure programme fully funded at
45-47% yield
International Petroleum Corp. 460-480
2022 Free Cash Flow Forecast (MUSD) (1,2)
33-34% yield
330-345
20-21% yield
205-210
6-7% yield
60-65
55 USD/bbl 70 USD/bbl 85 USD/bbl 100 USD/bbl
NCF00244 p11 01.22
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
2)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans. Assumptions include average net production of between 46 and 48 Mboepd, average
Brent oil prices of USD 55 to 100 per boe, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials as estimated by IPC’s independent reserves evaluator and as further
described in the MCR. Free cash flow yield is based on IPC’s market capitalization at close February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million). IPC’s current business plans and assumptions, and the business
environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
IPC CMD 2022 10International Petroleum Corp.
2022 Free Cash Flow Yield (1)
Global Integrated & E&P Industry Average FCF Yields % - 2022
40%
35%
~30%(2)
30%
25%
20%
20%
15% 13%
10%
6%
5%
0%
NA Senior NA NA Euro Canada USA
IPC Average All Colombia EP Intermediate Integrated Majors Royalty Royalty Aramco
EP
Source: RBC Capital Markets and company estimates
NCF00244 p26 01.22
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
2)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans. Assumptions include average net production of between 46 and 48 Mboepd, average
Brent oil prices of ~80 USD/boe, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials as estimated by IPC’s independent reserves evaluator and as further
described in the MCR. Free cash flow yield is based on IPC’s market capitalization at close February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million). IPC’s current business plans and assumptions, and the business
environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
IPC CMD 2022 11International Petroleum Corp.
Shareholder Distribution Framework(1)
40% of FCF above 55 USD/bbl Brent planned to be distributed to shareholders
Provided Net Debt / EBITDA(2)International Petroleum Corp.
Forecast 2P Reserves Capital Expenditure (1)
5 Year Business Plan CAPEX = ~400 MUSD / 4.65 USD/boe
Sustains production at approximately 5 Year Business Plan OPEX = 15-16 USD/boe(2)
47,000 boepd
Full discretion on forward plan
MUSD
Strongly positioned for significant
free cash flow generation(2)
2022 2023 2024 2025 2026
NCF00244 p13 01.22
1)
See Reader Advisory, including “Forward-Looking Statements”. Based on IPC’s current business plans and assumptions, which are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
2)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 13Western Canada oil supply vs pipeline Egress (Million bopd)
International Petroleum Corp.
6.5
Canadian Supply and Egress 6.0
TransMountain
expansion
5.5
e ment
c
3 repla
NB Line
5.0 E
ENB Mainline 2022+ optimizations
W. CDA total oil supply to market
ENB Express 2022+ optimizations
TC Energy Keystone expansion
4.5
Enbridge Line 3 370,000 bopd
Replacement in service 4.0
In service Q4 2021 3.5
AB & SK Refineries & industry demand + existing pipeline
3.0
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Trans Mountain 590,000 bopd Source: Stifel FirstEnergy, CAPP, EIA, Alberta Energy Regulator, & Company disclosures
Expansion 2023
Canada - Storage Capacity
As of Jan 2022, 45% complete,
50
expected completion 2023
40
30 Diluent
MMbbls
20
Crude
60% of Canadian oil production hedged 10
at ~13 USD/bbl WTI/WCS differential
NCF00244 p15 01.22
0
for remainder of 2022 Jan
2021
Feb
2021
Apr
2021
May
2021
Jul
2021
Aug
2021
Sep
2021
Nov
2021
Dec
2021
Jan
2022
Source: woodmac.com, North American Crude Oil Fundamentals, February 2, 2022
IPC CMD 2022 14International Petroleum Corp.
Resilience of Free Cash Flow Generation(1,2)
CMD2022–2026
IPC 2017–2021
95
CMD2017–2021
IPC 2017–2021 USD
>1,800 MUSD FCF
~36% p.a.
FCF
>660
MUSD
~47 75
USD
Mboepd
35.5 61 >1,200 MUSD FCF
Mboepd USD ~24% p.a.
55
USD
>600 MUSD FCF
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
~12% p.a.
NCF00244 p04 01.22
2)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans over the period of 2022 to 2026. Assumptions include average net production over that
period of approximately 47 Mboepd, average Brent oil prices of USD 55 to 95 per boe escalating by 2% per year, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials
as estimated by IPC’s independent reserves evaluator and as further described in the MCR. Free cash flow yield is based on IPC’s market capitalization at close February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million).
IPC’s current business plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
IPC CMD 2022 15International Petroleum Corp.
Enterprise Value Liquidation (1,2) >1,800 MUSD
95
1,108 MUSD
>900 MUSD
65
Market Cap
1,014
MUSD
February 3, 2022
Net Debt
December 31, 2021 94 MUSD
Enterprise value 5 year forecast FCF
NCF00244 p17 01.22
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
2)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans over the period of 2022 to 2026. Assumptions include average net production over that
period of approximately 47 Mboepd, average Brent oil prices of USD 65 to 95 per boe escalating by 2% per year, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials
as estimated by IPC’s independent reserves evaluator and as further described in the MCR. IPC’s current business plans and assumptions, and the business environment, are subject to change. Actual results may differ materially
from forward-looking estimates and forecasts.
IPC CMD 2022 16International Petroleum Corp.
Value Created from Acquisition(1,2)
~1.7 billion USD in value added from 4 acquisitions
Suffield - Jan 2018 BlackPearl - Dec 2018 Granite - Mar 2020 Bertam 25% WI - Apr 2021
1,549 48
793 168
+ 374 MUSD 38
value added + 1,147 MUSD + 113 MUSD
value added value added + 48 MUSD
value added
593
1,445
36
160
MUSD
MUSD
MUSD
MUSD
419
55
402
200
12
105 8 0
Acquisition FCF to NPV8 Acquisition FCF to NPV8 Acquisition FCF to NPV8 Acquisition FCF to NPV8
Price End 2021 @ 01/01/22 Price End 2021 @ 01/01/22 Price End 2021 @ 01/01/22 Price End 2021 @ 01/01/22
(Nil)
NCF00244 p24 01.22
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
2)
As at December 31, 2021. See Reader Advisory, MD&A and MCR, including “Disclosure of Oil and Gas Information”. NPV is after tax, discounted at 8% and based upon the forecast prices and other assumptions further
described in the MCR.
IPC CMD 2022 17International Petroleum Corp.
Net Asset Value (MUSD) (1)
2,522
2,428 (143 SEK/share)
-94
ed
58%
discount
add to NAV
lue
va
USD
lion 1,014 (60 SEK/share)
Bil
9
> 1.
543
2017 YE 2021 Net Debt(2) YE 2021 IPCO
Net Present Net Asset Market Cap(3)
Value Value
NCF00244 p18 01.22
1)
As at December 31, 2021. See Reader Advisory, MD&A and MCR, including “Disclosure of Oil and Gas Information”. NPV is after tax, discounted at 8% and based upon the forecast prices and other assumptions
further described in the MCR. NAV is calculated as NPV less net debt of USD 94 million as at December 31, 2021. NAV per share is based on 155,037,454 IPC common shares, being 155,198,105 IPC common shares
outstanding as at December 31, 2021 less 1,160,651 IPC common shares held in treasury for cancellation in early January 2022.
2)
See Reader Advisory and MD&A, including “Non-IFRS Measures”. 3) Based on IPC share price on February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million).
IPC CMD 2022 18International Petroleum Corp.
Canada - Blackrod Contingent Resources(1)
Capital
Resources Expenditure Knowledge
MMbbl Full field 7 years
1,283 development ~540 MUSD Successful pilot
Pre production
217 MMbbl Phase 1 Local expertise
development in SAGD operations
Production Profitability
80 Mbopd development
regulatory approved 860 MUSD NPV8
@ 01.01.22
USD/bbl WTI
20-30 Mbopd Phase 1 ~50 breakeven
NCF00246 p11 01.22
1)
As at December 31, 2021, best estimate, unrisked contingent resources and net present value. See Reader Advisory, MD&A and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 19International Petroleum Corp.
Sustainability & ESG
IPC Sustainability Priorities
Health and Safety
Ethics
No material safety incident in 2021
and Integrity
COVID-19 protocols remain in place across the organisation
Climate strategy Climate
On track to achieve 50% net emissions intensity reduction by 2025 (1)
Action
Second annual report released in 2021
Fully GRI(2) compliant Environmental
Stewardship
Net Emission Reduction Target (1) kg CO2e/boe
Health
Canadian and Safety
Industry IPC
Average emission
59
intensity 2019 IPC
net emission
Rewarding
intensity 2020 IPC workplace
2025
40 target
33 Community
20 Engagement &
Development
NCF00244 p21 01.22
Sources: National Inventory Report Canada and International Association of Oil & Gas Producers.
1)
See Reader Advisory, including “Forward-Looking Statements”. Target reduction is compared to IPC’s 2019 net emissions baseline. 2)
GRI = Global Reporting Initiative standard
IPC CMD 2022 202. 2022 Outlook
William Lundin, COO
21International Petroleum Corp.
Resource Maturation Strategy 300
Canada
250
200
+186%
MMboe
150
100
Focus on undeveloped reserves and contingent resources 50
0
2017 2020 2021
Proven track record of maximising resource base through organic
and inorganic growth Malaysia
25
20
+69%
Proved plus probable reserves: 270 MMboe (1) 15
MMboe
-
2P reserves replacement 91% 10
5
Contingent Resources: 1,410 MMboe (2) 0
2012 2020 2021
2C increase by 28%
France
Combined reserves and resources replacement ratio > 2,000 % 40
35
30 +55%
25
MMboe
20
15
Reserves
NCF00245 p01 01.22
10
Cumulative Production 5
1)
As at December 31, 2021. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
0
2)
As at December 31, 2021, best estimate, unrisked. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”. 2002 2020 2021
IPC CMD 2022 22International Petroleum Corp.
Reserves – Year End 2021 (1) Light & Medium Oil
Malaysia, 2%
France, 4%
Canada, 5%
Gas, 26%
2P Reserves life index (RLI) of 16 years
Total
270 MMboe(1)
Undeveloped
IPC YE 2021 Reserves Developed
350 Heavy Oil, 63%
300
250
MMboe
200
2P Reserves MMboe
150
End 2020 272
100 2021 Production - 16
50 Canada +11
0 Malaysia(2) +2
PDP 1P 2P 3P
NCF00245 p03 01.22
RLI France +1
6 11 16 19
End 2021 270(1)
1)
As at December 31, 2021. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”. 2)
Includes the acquisition of further 25% interest in the Bertam field, completed in April 2021.
IPC CMD 2022 23International Petroleum Corp.
2C Contingent Resources – Year End 2021 (1)
Contingent Resources History
1,410
Contingent resource position 5x reserves 1,089 1,102
128 MMboe of contingent resources excluding Blackrod 849
Light and medium oil, 30
Gas, 40 0 63
Heavy oil, 57 IPC YE17 YE18 YE19 YE20 YE21(1)
Inception
Total 2C Contingent Resources MMboe
1,410 MMboe(1) End 2020 1,102
Canada + 303
Malaysia +6
France -1
Blackrod 1,283 End 2021 1,410(1)
NCF00245 p04 01.22
1)
As at December 31, 2021, best estimate, unrisked. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 24International Petroleum Corp. 2022 Production Guidance
Production Guidance (1) International, 18%
sia
lay
Ma
Canada Gas, 33% ce
n
Suffield Fra
Canada Other
Gas
2022 production guidance: 46,000 to 48,000 boepd Ferguson
Investment strategy targeting growth in all regions
Onion Lake
Production in excess of pre COVID level Suffield
Oil Thermal
Canada Oil, 49%
Production (Mboepd)
50 High guidance 48
50
46 46 48
46
Low guidance 46 46
42 43
40 40 41
34 37
34
30 30
20
High Guidance
Low range
10
Gas 11
10 9
Oil WCS
Oil Brent
NCF00245 p05 01.22
0
2017 2018 2019 2020 2021 Q1 Q2 Q3 Q4
2022 Full Year
2022
1)
See Reader Advisory, including “Forward-Looking Statements” and “Supplemental Information regarding Product Types” in “Disclosure of Oil and Gas Information”.
IPC CMD 2022 25International Petroleum Corp.
2022 Operating Costs(1)
Stable operating costs in line with 2021
Includes provisions for maintenance and workovers 2022 Guidance
No major shutdowns in 2022 International, 30% Canada, 70%
Minor rig move and process shutdowns in Malaysia France
Canada Southern Assets
2022 Guidance - Operating Costs Malaysia
Canada Northern Assets
NCF00245 p06 01.22
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 26International Petroleum Corp.
2022 Budget
Capital Expenditure (1) Capital Allocation
France, 11%
127 MUSD budget targets growth in all regions
IPC controlled development budget Canada, 65%
Malaysia, 24%
127
MUSD
Canada – 82 MUSD
- Onion Lake Thermal Pad L
- OLT infill Phase 2
- Ferguson development
- Suffield drilling
- Blackrod pilot & FEED
- Optimisation projects France – 14 MUSD
- VPU West development
- Aquitaine well optimisations
Malaysia – 31 MUSD
- A15ST drilling
- ESP upgrades
NCF00245 p08 01.22
1)
Including forecast decommissioning expenditure of 6 MUSD.
IPC CMD 2022 27International Petroleum Corp.
Organic Growth
Mature opportunity set allows flexibility to accelerate projects
Future 2022
Opportunities Projects
Canada » Onion Lake Thermal expansion
» Conventional oil drilling
» Mooney EOR expansion » Ferguson field development
» Suffield N2N EOR Phase 2 » Onion Lake Thermal Pad L
» Suffield gas recompletions » Onion Lake Thermal infill wells
» Blackrod commercial development » Suffield oil and gas optimisation
» Ferguson Expansion
Malaysia » Phase 4 infills » A15st
» ESP upgrades
France » Rhaetian drilling » Villeperdue West
» Merisier infills
» Villeperdue North
NCF00245 p09 01.22
IPC CMD 2022 28International Petroleum Corp.
5 Year Outlook(1)
Production Outlook (1) (Mboepd)
~47 Mboepd
~47 Mboepd average net production over the next 5 years (1)
Full discretion on pace of development
More than 2/3 of 2P reserves remaining beyond 5 year outlook
Investment strategy 2022e 2023e 2024e 2025e 2026e
Growth capital spend on Onion Lake Thermal
Suffield and Ferguson drilling Capex Program (2) (MUSD)
Assumes no further projects in France and Malaysia beyond 2023
~4.65 USD/boe
Low sustaining capex provides platform for material
free cash flow generation
2022e 2023e 2024e 2025e 2026e
NCF00245 p10 01.22
1)
See Reader Advisory, including “Forward-Looking Statements”. Based on IPC’s current business plans and assumptions, which are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
2)
Excluding decommissioning expenditure.
IPC CMD 2022 293. Asset Overview
William Lundin, COO &
Chris Hogue, SVP Canada
303a. Asset Overview
Chris Hogue, SVP Canada
31IPC Canada
Strategy
Alberta Saskatchewan
Deliver organic growth projects
Blackrod
Heavy oil
Maintain optionality to increase capital investments
Onion Lake
Edmonton
Heavy oil
Progress Blackrod commercial development plan Calgary
Regina
Suffield
Medicine Hat
Gas & Heavy oil
Ferguson 0 KM 200
Light oil
NCF00246 p01 01.22
IPC Northern Assets
IPC Southern Assets
Major oil sands deposits
IPC CMD 2022 32IPC Canada Onion Lake Thermal - Net Pay
Onion Lake Thermal(1)
Pad L
Pad D’
Excellent facility and reservoir performance
Record production achieved in 2021
New sustaining Pad D’ and five infills successfully brought onstream
> 4 MMboe reserve additions(2)
Pad L
2022 Outlook Pad D’
Execute drilling and early works for Pad L
Deliver 2 infill well project
Install additional heat exchanger to capture waste heat
Onion Lake Thermal Production Actual
14,000
Low
pricing Planned
12,000 Maintenance
IPC acquisition
10,000
Production (bopd)
8,000
6,000
4,000
2,000
NCF00246 p02 01.22
- 0 KM 1
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
Mar
Mar
Mar
Mar
Mar
Mar
Jul
Jul
Jul
Jul
Jul
Jul
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
2016 2017 2018 2019 2020 2021 Sep
1)
See Reader Advisory, including “Forward-Looking Statements”. 2)
As at December 31, 2021. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 33IPC Canada
Suffield Assets(1)
Suffield/Alderson Assets
Suffield
Oil and gas production excels under IPC operatorship
Highest annual production average since 2015 at Suffield Oil
Natural gas decline rate offset through optimisation activity
30 MMboe production replaced since acquired(2)
Suffield Reserves and Production CFB Suffield
140 Alderson
0 KM 20
120
+30%
100 IPC Licences
Operated / Shallow Gas
Redcliff
MMboe
80 Hydrocarbon fields/discoveries
Oil pools
60
Medicine Hat
40
20 Reserves
Cumulative Production
NCF00246 p04 01.22
-
YE 2017 YE 2018 YE 2019 YE 2020 YE 2021
1)
See Reader Advisory, including “Forward-Looking Statements”. 2)
As at December 31, 2021. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 34IPC Canada
Suffield Assets(1) 14,000
Gas Swabs per Annum
12,000
Deliver strategic investment 10,000
8,000
Expand N2N EOR flood through infill drilling hi
p
s
rator
Single well battery tie-ins and well conversions 6,000
Op
e
IPC
Maximise natural gas swabbing activity 4,000
2,000
Potential to expand capital program 0
2014 2015 2016 2017 2018 2019 2020 2021 2022e
Significant inventory of drilling and recomplete candidates
Suffield Gas Production
Pre acquisition decline -9%
Suffield Oil Production Actual
9,000 Actual
Pre acquisition decline (-10%) IPC IPC
acquisition
acquisition Low 120,000 IPC acquisition
8,000
pricing
7,000 100,000
6,000
Production (boepd)
5,000 80,000
Production (Mscf/d)
4,000
Winter freeze-offs Winter freeze-offs
60,000
3,000
2,000
40,000
1,000
NCF00246 p05 01.22
- 20,000
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Mar
Jul
Jul
Jul
Jul
Jul
Jul
Jul
Jul
Jul
Jul
Jul
Jul
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021
1)
See Reader Advisory, including “Forward-Looking Statements”.
IPC CMD 2022 35Ferguson - 2022 Drilling Program
IPC Canada R18 R17 R16 R15W4
N
T4
Ferguson(1)
Acquired by IPC in 2020
T3
Deliver forecast production growth through
Ferguson
2022 development programme
2022 wells
Drill and complete 13 horizontal wells Oil wells
Gas injector
Milk River town
Convert 3 oil wells to gas injectors Net pay
T2
0 1 KM 4 Ferguson pool
Upgrade gas compression capacity
Ferguson Production Actual Forecast
3,500
3,000
2,500
Production (boepd)
2,000 IPC acquisition
2 x
1,500
>
1,000
500
NCF00246 p06 01.22
0
Jan
Mar
May
Jul
Sep
Nov
Jan
Mar
May
Jul
Sep
Nov
Jan
Mar
May
Jul
Sep
Nov
Jan
Mar
May
Jul
Sep
2019 2020 2021 2022 Nov 1)
See Reader Advisory, including “Forward-Looking Statements”.
IPC CMD 2022 36Major Oil pipeline
Major Gas pipeline
IPC – Canada
IPC asset
Mooney and Conventional Assets Overview Mooney
Mooney production ramped up to pre-curtailment rates
Successful optimisation of EOR scheme
Conventional
Mature phase 2 expansion investment decision in 2022 Assets
Conventional oil fields to provide >1,000 bopd in 2022(1) Edmonton Onion Lake
Mooney Production
Actual Forecast
Alberta
1,600
Low
pricing
1,400 Saskatchewan
1,200
IPC acquisition
1,000 Graindale
Production (bopd)
800
Calgary Office
600
British
400
Columbia
200 Redcliff Office
NCF00246 p07 01.22
-
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
May
Nov
Mar
Mar
Mar
Mar
Mar
Mar
Jul
Jul
Jul
Jul
Jul
Jul
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
Jan
Sep
2017 2018 2019 2020 2021 2022
1)
See Reader Advisory, including “Forward-Looking Statements”. USA 0
0
20
8
KM
Miles 40
80
IPC CMD 2022 37IPC Canada
Blackrod Asset Overview(1) Blackrod Net Pay
0 1 km 2 Athabasca
Blackrod
Peace River
Development Area
Cold Lake
Mooney
Edmonton Onion Lake
Calg
ary Calgary Canada Regina
Medecine Hat
Suffield
Material increase in 2C resources to 1.3 Billion bbls Blackrod pilot wells
>150 MUSD invested pre IPC acquisition
Phase 1 Development Area
Seismic and vertical well control
Three successful well pairs
Regulatory approval for next 80,000 bopd Well Pair Production
commercial operation WP2 WP3 WP3 Forecast
900
2020
Phased approach to development 800
2021 2022
Leverage in house thermal oil expertise 700
600
Production (bopd)
Front End Engineering Design underway for Phase 1 500
400
300
200
NCF00246 p09 01.22
100
0
1)
As at December 31, 2021, best estimate, unrisked contingent resources. See Reader Advisory, MD&A and MCR, 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35
including “Disclosure of Oil and Gas Information”. Month
IPC CMD 2022 38IPC Canada
Blackrod Contingent Resources(1)
Blackrod Net Pay Map
Substantial increase in contingent resources
R18
R17W4
across all reporting categories
RF factor improvement and extension of booked volumes to the south
Development Area
Results are reflective of WP3 pilot performance
1,400 m well pair length
T77
T77
Optimised phase 1 development concept
CPF designed to 20,000 bbl/d oil capacity expanding to 30,000 bbl/d
Phase 1 Development Area
Blackrod 2C Resources
1,283
MMbboe
1,066
T76
T76
171 217
NCF00246 p10 01.22
Original 2021 Future
R18
R17W4
Phase 1 Optimisation Phases 0 km 2
1)
As at December 31, 2021, best estimate, unrisked contingent resources. See Reader Advisory, MD&A and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 393b. Malaysia
William Lundin, COO
40IPC Malaysia
Strategy
Maintain high level of operational excellence
Deliver A15 sidetrack and pump upgrades
South China
Sea
Mature value growth opportunities
Malaysia
Bertam
Kuala Lumpur Natuna
Sea
NCF00247 p01 01.22
Singapore
Indonesia 0 KM 400
IPC CMD 2022 41IPC Malaysia
Bertam Performance
Bertam FPSO
Excellent operational and reservoir performance
Close to 100% facility uptime since project sanction
Significant ultimate recovery improvement through time
Bertam Field Production
Planned
12,000
maintenance
Base Phase 1+2+3 IPC Working Interest
Reserves and Resources Progression (1)
turnaround
30
10,000
Planned
8,000 maintenance
Production (bopd)
20
+69%
6,000
MMbo
4,000 10
2C Resources
2P Reserves
2,000
0
Production
NCF00247 p02 01.22
0 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov
2012 YE 2021
2017 2018 2019 2020 2021 2022
1)
As at December 31, 2021. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 42IPC Malaysia Bertam Structure
Bertam Development(1) A20
A15 sidetrack
A15 Sidetrack
Drilling on track for Q1 2022 first oil Bertam FPSO
A09
Rate potential >1,500 bopd
Pump upsizing A16
ESP Upgrades
To be completed post A15 using same drilling rig A13
Incremental production ~700 boepd
Infill Campaigns Gross EUR (MMboe)
Additional infill locations identified and being
matured in 2022
8.9
6.3
NCF00247 p03 01.22
Phase 1+2+3
1)
See Reader Advisory, including “Forward-Looking Statements”. Pre Drill Post Drill
IPC CMD 2022 433c. France
William Lundin, COO
44Paris Basin Licences
IPC France
0 KM 50
IPC licences
Production
Reims Exploration
Strategy ILE DE FRANCE
La Marne
La Motte Noire
Plivot
Oil field
Vert-la-Gravelle
Paris Fontaine-au-Bron W&S Soudron
La
Ma
rn
Villeperdue
e
Dommartin-Lettrée
Amaltheus
Courdemanges
Merisier
La
L’Aube
Se
in
e
eine Grandville
La S
La
Maintain efficient operations
Se
in
e
Execute Villeperdue West development Q4 2022(1)
Focus on undeveloped reserves and
contingent resources
Aquitaine Basin Licences
Paris Basin
IPC licences
Production
Oil field
France
Courbey
AQUITAINE
Les Mimosas Les Pins
Les Arbousiers Tamaris
0 KM 200
NCF00247 p10 01.22
0 KM 10
1)
See Reader Advisory, including “Forward-Looking Statements”.
IPC CMD 2022 45IPC France Villeperdue Facilities
France Operations
Long life low decline assets
Base decline offset by recent development and optimisation activity
11.5 MMboe of 2P ensures steady cash flow generation(1)
~85% in developed and producing category
Significant portfolio of growth opportunities in contingent resources(1)
2C:2P ratio ~170%
2P Reserves (1) Net Production
Paris Basin Aquitaine
3.5
Aquitaine Basin, 1.4 3.0
2.5
Production (Mbopd)
2.0
11.5 1.5
MMbbl
1.0
0.5
NCF00247 p11 01.22
Paris Basin, 10.1 0.0
2017 2018 2019 2020 2021
1)
As at December 31, 2021 including best estimate, unrisked contingent resources. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 46VGR-113H Production Performance
IPC France 1,600
1,400
Actuals
Investment Case
Paris Basin Development(1) 1,200
1,000
VGR5 conversion
bopd
800
600
400
200
2019 Vert-la-Gravelle horizontal drilling 0
Successfully executed 3 well program
Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan
2019 2019 2020 2020 2020 2020 2020 2020 2021 2021 2021 2021 2021 2021 2022
Exceptional performance from central well VGR113H
Villeperdue Development
2022 Villeperdue development
Targeting large unswept area to the West
3 horizontal wells utilising existing infrastructure
N19H
Planned Q4 execution with first oil in Q1 2023
Incremental production >500 bopd
Phase 1
Phase 2 K18H
North Pad
I16H
NCF00247 p12 01.22
Phase 2
South Pad
1)
See Reader Advisory, including “Forward-Looking Statements”.
IPC CMD 2022 47International Petroleum Corp. 2022
CMD Guidance
2022 Overview
Production
Production (1)
Record production expected in 2022
5 year business plan targets ~47 Mboepd (1) 46 to 48
Mboepd
Investments
Capital (2)
Organic growth in all countries
Further opportunities beyond 2022 firm program 127
MUSD
Reserves (3) Total
Resources (3)
91% reserve replacement
Strong position to grow reserve base ~1.7
Billion boe
NCF00245 p11 01.22
1)
See Reader Advisory, including “Forward-Looking Statements”. Based on IPC’s current business plans and assumptions, which are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
2)
Including forecast decommissioning expenditure. 3)
As at December 31, 2021, including best estimate, unrisked contingent resources See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 484. Financial Overview
Christophe Nerguararian, CFO
49International Petroleum Corp.
2022 CMD Economic Assumptions
Low Case Base Case High Case Very High Case 2021 Actual
Oil in USD/bbl
Brent 55 70 85 100 71
WTI 52 67 82 97 68
WCS 39 54 69 84 55
Gas in CAD/mcf
AECO 3.13 3.13 3.13 3.13 3.63
Sensitivities
WTI-WCS differential (USD/bbl) +/- 5 USD/bbl
AECO gas price (CAD/mcf) +/- 0.50 CAD/mcf
NC00248 p02 01.22
1)
See Reader Advisory, including “Forward-Looking Statements”.
IPC CMD 2022 50International Petroleum Corp.
2022 CMD Guidance
Main Assumptions Forecast Base Case Financials USD/boe
Production 46,000 to 48,000 boepd(1) Revenue 45.4
Capital Expenditure 121 MUSD(3) Operating Cash Flow (2) 21.5
Operating Costs (2) 15.2 USD/boe EBITDA (2) 21.1
Free Cash Flow (2) 12.1
NC00248 p01 01.22
1)
See Reader Advisory, including “Forward-Looking Statements”. Based on IPC’s current business plans and assumptions, which are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
2)
See Reader Advisory and MD&A, including “Non-IFRS Measures”. 3)
Excludes forecast decommissing expenditure of MUSD 6
IPC CMD 2022 51International Petroleum Corp.
Realised Oil Prices (USD/bbl)
Forecast Actual
2022 2021 2020 2019
Brent 70.0 70.9 41.8 64.2
Malaysia 73.0 (+3.0) 75.1 (+4.2) 44.5 (+2.7) 69.9 (+5.7)
France 69.9 (-0.1) 71.0 (+0.1) 35.8 (-6.0) 63.5 (-0.7)
WTI 67.0 68.1 39.6 57.0
WCS (calculated) 54.0 55.1 27.0 44.2
Suffield 52.7 (-1.3) 54.0 (-1.1) 27.5 (+0.5) 45.6 (+1.4)
Onion Lake 54.0 (–) 52.8 (-2.3) 22.6 (-4.4) 37.8 (-6.4)
NC00207 Q3 10.21
IPC CMD 2022 52International Petroleum Corp.
AECO, Empress and Realised Gas Prices
Forecast(1) Full Year Full Year Full Year
Henry Hub Price USD/MMbtu CAD/mcf 2022 2021 2020 2019
Realised Price CAD/Mcf AECO 3.13 3.63 2.23 1.80
Empress 3.24 3.90 2.22 2.49
Empress / AECO differential
Realised 3.24 (-) 3.70 (-0.20) 2.28 (+0.06) 2.77 (+0.28)
AECO Day Ahead Index
7 7
6 6
4.87
5 5
3.86
CAD/Mcf
3.72
4 3.11 3.05 4
2.73
USD/MMbtu
2.43 2.72
3
2.23 2.28 2.16 3
1.93
2 2
1 1
0 0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
NC00248 p04 01.22
2019 2020 2021 2022
1)
See Reader Advisory, including “Forward-Looking Statements”.
IPC CMD 2022 53International Petroleum Corp.
Margin Netback (1) (USD/boe)
2022 Forecast 2021
Low Base High Very High Actual
Brent/WTI/WCS (USD/bbl) (55/52/39) (70/67/54) (85/82/69) (100/97/84) (71/68/55)
Production Guidance 46,000–48,000 45,500
Revenue 35.2 45.4 54.7 64.1 40.1
Cost of operations -12.5 -12.5 -12.5 -12.5 -12.3
Tariff and transportation -2.1 -2.1 -2.1 -2.1 -2.0
Direct Production taxes -0.5 -0.6 -0.6 -0.7 -0.7
Operating costs (2) -15.2 -15.2 -15.2 -15.3 -15.0
Cost of blending -6.6 -8.3 -10.0 -11.7 -4.6
Inventory movements -0.1 -0.1 -0.1 -0.1 0.1
Cash Margin Netback 13.4 21.8 29.4 37.0 20.6
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 54International Petroleum Corp.
Hedging
2022 Canadian hedging in place
Oil hedging (~60% of Canadian oil Mar-Dec production): Historic WTI/WCS Diff (USD/bbl)
50
Mar-Jun 22: 11.9 Mbopd WTI/WCS diff. swap at 13.06 USD/bbl 45
44.73
40
Jul-Dec 22: 16.0 Mbopd WTI/WCS diff. swap at 13.04 USD/bbl
35
Gas hedging: 30
25
Q1 22: ~19 MMcfd of Canadian gas sales hedged at AECO 4.40 CAD/mcf 20
Q2-Q3 22: ~33 MMcfd of Canadian gas sales hedged at AECO 3.60 CAD/mcf 15 Hedge
10 13 USD/bbl
5
2022 Malaysian/French oil production 0
4.34
(Brent linked) unhedged
Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov
2018 2019 2020 2021 2022
No hedge covenants
NC00248 p13 01.22
IPC CMD 2022 55International Petroleum Corp.
Operating Costs Forecast (USD/boe) (1)
USD/boe Quarterly Operating Costs
20
Increasing Production
18
16
2022 Guidance
Average 15.2 USD/boe
Bertam Workover
14
12
10
8
Q1 2022 Q2 2022 Q3 2022 Q4 2022
NC00248 p06 01.22
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 56International Petroleum Corp.
Operating Cash Flow (1) and EBITDA Netback (1) (USD/boe)
2022 Forecast 2021
Low Base High Very High Actual
Brent/WTI/WCS (USD/bbl) (55/52/39) (70/67/54) (85/82/69) (100/97/84) (71/68/55)
Cash Margin Netback 13.4 21.8 29.4 37.0 20.6
Cash Taxes -0.1 -0.3 -0.5 -0.8 -0.3
Operating Cash Flow Netback 13.3 21.5 28.9 36.2 20.3
EBITDA Netback 12.6 21.1 28.7 36.3 19.9
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 57International Petroleum Corp.
Profit Netback (1) (USD/boe)
2022 Forecast 2021
Low Base High Very High Actual
Brent/WTI/WCS (USD/bbl) (55/52/39) (70/67/54) (85/82/69) (100/97/84) (71/68/55)
Cash Margin Netback 13.4 21.8 29.4 37.0 20.6
Depletion/depreciation -8.3 -8.3 -8.3 -8.3 -7.9
Business development and exploration costs -0.1 -0.1 -0.1 -0.1 -0.1
General and administration costs -0.8 -0.8 -0.8 -0.8 -0.7
Financial items, net -2.1 -2.1 -2.1 -2.1 -1.8
Profit Before Tax 2.1 10.5 18.1 25.7 10.1
Tax -0.8 -2.2 -3.3 -4.5 -1.3
Net Result 1.3 8.3 14.8 21.2 8.8
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 58International Petroleum Corp.
Oil Sensitivity to WTI/WCS Differential
2022 Forecast
Base Case
WTI oil price (USD/bbl) 67 67
WTI/WCS Differential (USD/bbl) 13 18 Difference
Total Revenue (USD/boe) 45.4 44.1 -1.3
Operating Cash Flow (1) (USD/boe) 21.5 20.2 -1.3
EBITDA (1) (USD/boe) 21.1 19.8 -1.3
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 59International Petroleum Corp.
Gas Sensitivity to Realised Canadian Gas Price
2022 Forecast
Base Case
Gas price (CAD/mcf) 3.13 3.63 Difference
Total Revenue (USD/boe) 45.4 45.9 +0.5
Operating Cash Flow (1) (USD/boe) 21.5 21.8 +0.4
EBITDA (1) (USD/boe) 21.1 21.4 +0.4
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”.
IPC CMD 2022 60International Petroleum Corp.
Free Cash Flow (1) (USD/boe)
2022 Forecast 2021
Low Base High Very High Actual
Brent/WTI/WCS (USD/bbl) (55/52/39) (70/67/54) (85/82/69) (100/97/84) (71/68/55)
Operating Cash Flow Netback(1) 13.3 21.5 28.9 36.2 20.3
Cash General and Administration Costs -0.7 -0.7 -0.7 -0.7 -0.6
Cash Financial Items -1.2 -1.2 -1.2 -1.2 -0.9
Cash Available for Investment 11.4 19.6 27.0 34.3 18.8
Capital expenditure (2) 7.7 7.5 7.3 7.0 3.0
Free Cash Flow(1) 3.7 12.1 19.7 27.3 15.8
1)
See Reader Advisory and MD&A, including “Non-IFRS Measures”. 2)
Includes E&A, farm-in and decommissioning expenditure.
IPC CMD 2022 61International Petroleum Corp.
Capital Structure
5 year unsecured 300 MUSD Bond @ 7.25% p.a. coupon
2 year revolving credit facility 75 MCAD
2 previous reserves-based lending facilities repaid and cancelled
NC00248 p03 01.22
IPC CMD 2022 625. Reserves Valuation
Rebecca Gordon, VP IR & Planning
63International Petroleum Corp.
Long-term Brent Price Forecast (1)
Realised Price Year End 2021 Price Deck
Brent USD/bbl (1) Year End 2020 Price Deck
100
93
Spot Price
90
80
75
73
71 71 72 71
70
70
64
60 57 58
55 56
50
50
42
40
30
NC00250 p01 02.22
2018 2019 2020 2021 2022 2023 2024 2025 2026
1)
See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”
IPC CMD 2022 64International Petroleum Corp.
Long-term Canadian Pricing Forecast (1)
Western Canadian Select (WCS) USD/bbl Empress Gas Price CAD/mcf
80 77.7 6.0
Spot Price
75 5.5 5.25
Spot Price
70
5.0
65
61 4.5 4.44
60
57 57
55 55 56 3.90
4.0 3.82
55
3.65
CAD/mcf
3.58
USD/bbl
3.51
50 3.5
3.48 3.55
3.36 3.42
45
44 3.07 3.35
43 3.0
42
41 41
40
39
2.5
2.49
36
35 2.22
2.0
30 27
1.5
25
20 1.0
2018 2019 2020 2021 2022 2023 2024 2025 2026 2018 2019 2020 2021 2022 2023 2024 2025 2026
Realised Price Year End 2021 Realised Price Year End 2021
NC00250 p02 02.22
Year End 2020 Year End 2020
1)
See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”
IPC CMD 2022 65International Petroleum Corp.
NAV (1) Changes (MUSD)
2,410 2,522
94
2,428
291
2,120
1,630
1,523
321 94
1,429
1,309
Net Debt (2)
NAV
2020 2021 2022 2022
@ 2021 price
NC00250 p04 02.22
1)
As at December 31, 2021. See Reader Advisory, MD&A and MCR, including “Disclosure of Oil and Gas Information”. NPV is after tax, discounted at 8% and based upon the forecast prices and other assumptions
further described in the MCR. NAV is calculated as NPV less net debt of USD 94 million as at December 31, 2021. NAV per share is based on 155,037,454 IPC common shares, being 155,198,105 IPC common shares
outstanding as at December 31, 2021 less 1,160,651 IPC common shares held in treasury for cancellation in early January 2022.
2)
See Reader Advisory and MD&A, including “Non-IFRS measure”.
IPC CMD 2022 66International Petroleum Corp.
Net Present Value per Share (1) (MUSD)
NPV8 2P
2,522
2P NPV8 (SEK/Share)
NPV8 1P Malaysia/France Onion Lake Thermal
1,752
19
60% Developed
NPV8 PDP Canada other incl. tax
1,159 19
Enterprise Value
1,108 MUSD 69
Ferguson 9
32
Suffield
68 103 148
SEK/share
NC00250 p03 02.22
1)
As at December 31, 2021. See Reader Advisory, MD&A and MCR, including “Disclosure of Oil and Gas Information” and “Non-IFRS Measures”. NPV is after tax, discounted at 8% and based upon the forecast prices
and other assumptions further described in the MCR. Enterprise value is calculated as IPC’s market capitalization at close February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million) plus net debt of USD 94 million
as at December 31, 2021. NPV per share is based on 155,037,454 IPC common shares, being 155,198,105 IPC common shares outstanding as at December 31, 2021 less 1,160,651 IPC common shares held in treasury for
cancellation in early January 2022. SEK per share amounts based on 9.1 SEK/USD.
IPC CMD 2022 67We are
an entrepreneurial
Respect
value-driven team
bringing energy
to the world in
a sustainable way
Excellence
6. Conclusion Resilience
Mike Nicholson, CEO
68International Petroleum Corp.
2022 Highlights
Low Operating Costs &
Production (1)
Balanced Capital Expenditure (2) Strong Cash Flow (3) Hedging
15.2 USD/boe 220-635 MUSD OCF Zero Brent/WTI
46-48 Mboepd 60% WCS/WTI differential
127 MUSD 60-480 MUSD FCF @ 13 USD/bbl
~30 MMcf per day
@ ~3.70 CAD
Strong Balance sheet (2) Increased Resources (4) Value (5) Sustainability Focus
reserves
94
Net debt MUSD 91% replacement reduction &
270 143 SEK/share Carbon offsets
EBITDA Leverage 0.3x
MMboe 2P 2P NAV
>1,400 MMboe 2C
1)
See Reader Advisory, including “Forward-Looking Statements” and “Supplemental Information regarding Product Types” in “Disclosure of Oil and Gas Information”. 2) See Reader Advisory and MD&A, including “Non-IFRS Measures”.
NCF00245 p13 01.22
3)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans. Assumptions include average net production of between 46 and 48 Mboepd, average Brent oil prices of USD 55 to 100 per boe,
average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials as estimated by IPC’s independent reserves evaluator and as further described in the MCR. Free cash flow yield is based on IPC’s market capitalization at close
February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million). IPC’s current business plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
4)
As at December 31, 2021, including best estimate, unrisked contingent resources See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
5)
As at December 31, 2021. See Reader Advisory, MD&A and MCR, including “Disclosure of Oil and Gas Information”. NPV is after tax, discounted at 8% and based upon the forecast prices and other assumptions further described in the MCR. NAV is calculated as NPV less
net debt of USD 94 million as at December 31, 2021. NAV per share is based on 155,037,454 IPC common shares, being 155,198,105 IPC common shares outstanding as at December 31, 2021 less 1,160,651 IPC common shares held in treasury for cancellation in early January 2022.
IPC CMD 2022 69International Petroleum Corp.
Strongly Positioned to Create Stakeholder Value
2022-2026
178% Stakeholder Returns
95
USD
36% p.a. Debt reduction, share buybacks & dividends
>1,800 MUSD FCF (1,2,3)
M&A
~47
Mboepd (1)
4 transactions in 4 years
65 89%
USD 18% p.a. Organic Growth
>1.4 Billion boe of contingent resources (4)
>900 MUSD FCF (1,2,3)
1)
See Reader Advisory, including “Forward-Looking Statements” and “Supplemental Information regarding Product Types” in “Disclosure of Oil and Gas Information”. 2)
See Reader Advisory and MD&A, including “Non-IFRS measures”.
NCF00244 p19 01.22
3)
See Reader Advisory, including “Forward-Looking Statements”. Estimated free cash flow generation is based on IPC’s current business plans over the period of 2022 to 2026. Assumptions include average net production over that period
of approximately 47 Mboepd, average Brent oil prices of USD 65 to 95 per boe escalating by 2% per year, average gas prices of CAD 3.00 per thousand cubic feet, and average Brent to Western Canadian Select differentials as estimated
by IPC’s independent reserves evaluator and as further described in the MCR. Free cash flow yield is based on IPC’s market capitalization at close February 3, 2022 (60.0 SEK/share, 9.1 SEK/USD, USD 1,014 million). IPC’s current business
plans and assumptions, and the business environment, are subject to change. Actual results may differ materially from forward-looking estimates and forecasts.
4)
As at December 31, 2021, best estimate, unrisked. See Reader Advisory and MCR, including “Disclosure of Oil and Gas Information”.
IPC CMD 2022 707. Q & A
71Reader Advisory
Forward-Looking Statements
This presentation contains statements and information which constitute “forward-looking statements” or “forward-looking information” (within the meaning of applicable securities legislation). Such statements and information (together, “forward-looking statements”) relate to future
events, including the Corporation’s future performance, business prospects or opportunities. Actual results may differ materially from those expressed or implied by forward-looking statements. The forward-looking statements contained in this presentation are expressly qualified by this
cautionary statement. Forward-looking statements speak only as of the date of this presentation, unless otherwise indicated. IPC does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws.
The Covid-19 virus and the restrictions and disruptions related to it had a material effect on the world demand for, and prices of, oil and gas as well as the market price of the shares of oil and gas companies generally, including the Corporation’s common shares. Although demand,
commodity prices and share prices have recovered, there can be no assurance that these effects will not resume or that commodity prices will not decrease or remain volatile in the future. These factors are beyond the control of the Corporation and it is difficult to assess how these, and
other factors, will continue to affect the Corporation and the market price of IPC’s common shares. In light of the current situation, as at the date of this presentation, the Corporation continues to review and assess its business plans and assumptions regarding the business environment,
as well as its estimates of future production, cash flows, operating costs and capital expenditures.
All statements other than statements of historical fact may be forward-looking statements. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, forecasts, guidance, budgets, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “forecast”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe”, “budget” and similar expressions)
are not statements of historical fact and may be “forward-looking statements”. Forward-looking statements include, but are not limited to, statements with respect to:
• IPC’s ability to maximize liquidity and financial flexibility in connection with the current and any future Covid-19 outbreaks;
• the potential for an improved future economic environment, including resulting from a lack of capital investment and drilling in the oil and gas industry;
• 2022 production range, operating costs and capital and decommissioning expenditure estimates;
• estimates of future production, cash flows, operating costs and capital expenditures that are based on IPC’s current business plans and assumptions regarding the business environment, which are subject to change;
• IPC’s financial and operational flexibility to continue to react to recent events and navigate the Corporation through periods of volatile commodity prices;
• IPC’s continued access to its existing credit facilities, including current financial headroom, on terms acceptable to the Corporation;
• the ability to fully fund 2022 expenditures from cash flows and current borrowing capacity;
• IPC’s ability to maintain operations, production and business in light of the current and any future Covid-19 outbreaks and the restrictions and disruptions related thereto, including risks related to production delays and interruptions, changes in laws and regulations and reliance on
third-party operators and infrastructure;
• IPC’s intention and ability to continue to implement our strategies to build long-term shareholder value;
• the ability of IPC’s portfolio of assets to provide a solid foundation for organic and inorganic growth;
• the continued facility uptime and reservoir performance in IPC’s areas of operation;
• future development potential of the Suffield and Ferguson operations in Canada, including the timing and success of future oil and gas drilling and optimization programs;
• development of the Blackrod project in Canada, including estimates of resource volumes, future production, timing, breakeven prices and net present value;
• current and future drilling pad production and timing and success of facility upgrades, tie-in work and infill drilling at Onion Lake Thermal;
• the potential improvement in the Canadian oil egress situation and IPC’s ability to benefit from any such improvements;
• the timing and success of the future development projects and other organic growth opportunities in France;
• the ability to maintain current and forecast production in France;
• the ability of IPC to achieve and maintain current and forecast production in Malaysia;
• the success of the drilling of the A15 sidetrack well and of the production well pump rate optimisation project in Malaysia;
• the ability of IPC to acquire further common shares under the share repurchase program, including the timing of any such purchases;
• the return of value to IPC’s shareholders as a result of the share repurchase program;
• the ability of IPC to implement further shareholder distributions in addition to the share repurchase program;
• IPC’s ability to implement its GHG emissions intensity and climate strategies and to achieve its net GHG emissions intensity reduction targets;
• estimates of reserves and contingent resources;
• the ability to generate free cash flows and use that cash to repay debt;
• IPC’s ability to identify and complete future acquisitions; and
• future drilling and other exploration and development activities.
Statements relating to “reserves” and “contingent resources” are also deemed to be forward-looking statements, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described exist in the quantities predicted or
estimated and that the reserves and resources can be profitably produced in the future. Ultimate recovery of reserves or resources is based on forecasts of future results, estimates of amounts not yet determinable and assumptions of management.
The forward-looking statements are based on certain key expectations and assumptions made by IPC, including expectations and assumptions concerning: prevailing commodity prices and currency exchange rates; applicable royalty rates and tax laws; interest rates; future well
production rates and reserve and contingent resource volumes; operating costs; the timing of receipt of regulatory approvals; the performance of existing wells; the success obtained in drilling new wells; anticipated timing and results of capital expenditures; the sufficiency of budgeted
capital expenditures in carrying out planned activities; the timing, location and extent of future drilling operations; the successful completion of acquisitions and dispositions; the benefits of acquisitions; the state of the economy and the exploration and production business in the
jurisdictions in which IPC operates and globally; the availability and cost of financing, labour and services; and the ability to market crude oil, natural gas and natural gas liquids successfully.
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