5 Year Operational Strategy - 26th October 2020 - Maha Energy
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5 Year Operational Strategy 26th October 2020
Contents
I. Introduction to Maha Energy
II. Asset overview
III. Financial overview
IV. Supporting material
2
Disclaimer
Future Oriented Financial Information and Notes to the Presentation
This information has been made public in accordance with the Securities Market Act (SFS 2007:528} and/or the Financial Instruments Trading Act (SFS 1991:980}.
Forward-Looking Statements Certain statements made and information contained herein constitute "forward-looking information" (within the meaning of applicable securities legislation}.
Such statements and information (together, "forward-looking statements"} relate to future events, including the Company's future performance, business prospects or opportunities. Forward-
looking statements include, but are not limited to, statements with respect to estimates of reserves and/or resources, future production levels, future capital expenditures and their allocation
to exploration and development activities, future drilling and other exploration and development activities. Ultimate recovery of reserves or resources are based on forecasts of future results,
estimates of amounts not yet determinable and assumptions of management.
All statements other than statements of historical fact may be forward-looking statements. Statements concerning proven, probable and possible reserves and resource estimates may also be
deemed to constitute forward-looking statements and reflect conclusions that are based on certain assumptions that the reserves and resources can be economically exploited. Any
statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, 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", "predict", "potential", "targeting", "intend", "could", "might",
"should", "believe" and similar expressions} are not statements of historical fact and may be "forward-looking statements". Forward- looking statements involve known and unknown risks,
uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements. No assurance can be given that these
expectations and assumptions will prove to be correct and such forward-looking statements should not be relied upon. These statements speak only as on the date of the information and
the Company does not intend, and does not assume any obligation, to update these forward-looking statements, except as required by applicable laws. These forward-looking statements
involve risks and uncertainties relating to, among other things, operational risks (including exploration and development risks}, productions costs, availability of drilling equipment, reliance on
key personnel, reserve estimates, health, safety and environmental issues, legal risks and regulatory changes, competition, geopolitical risk, and financial risks. These risks and uncertainties
are described in more detail under the heading "Risks Factors" and elsewhere in the Company's Prospectus. Readers are cautioned that the foregoing list of risk factors should not be
construed as exhaustive. Actual results may differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements are expressly qualified by this
cautionary statement.
Glossary
k thousand Gas to oil 6,000 cubic feet = 1 barrel of oil equivalent
conversion
m million
All monetary values are in USD unless otherwise noted.
boe Barrels of oil equivalent
bbls Barrels
bopd Barrels of oil per day
boepd Barrels of oil equivalents per day
kscf Thousand standard cubic feet
3
Maha Energy is a production focused upstream O&G company
Introduction Maha at a glance – key figures2)
§ International upstream oil & gas producer with a diverse portfolio of Operational Cash flow / Costs
operated onshore oil producing assets (to June 30, 2020)
- Listed in Stockholm (Nasdaq First North) – market cap of USD ~130m1)
3.7 - 4.0 kboepd2) USD 29m
§ After adding two assets during the year, Maha is now focused on continuing
to optimize operations and further developing its portfolio Production 2020e EBITDA LTM
- Operator of all assets providing control and capex flexibility
- Proven track record, through the Tie field development, in unlocking
value and cash flow from acquired assets 25 years USD 7.10/boe
- Prudent growth strategy through development of low break-even 2P reserves life Opex H1 2020
producing or close to producing assets
Asset and organization locations Reserves overview
2P reserves2) 2P reserves development
Technical office Illinois Basin3) mboe 45
Calgary 35º API
LAK Ranch 3
Operations 7% 19º API
office Mafraq 20% 34 33 9
Wyoming Lak Ranch (100% WI)
(99% WI) 9
13 13
Illinois Basin
(95% WI) Tartaruga (75% WI) Tie Field 44.8
36-38º API 13 12
Tie (100% WI) 44% mboe 9
20
5 assets 30%
Tartaruga
13 12 12
4 offices Operations
office
41º API 31.12.2016 31.12.2017 31.12.2018 31.12.2019
Illinois Basin Tie
64 employees Rio de Janeiro
Oil = 95% Gas = 5% LAK Ranch Tartaruga
Notes: 1) Diluted market capitalization as of 22 October 2020; 2) Production values are 2020 guidance. Reserves life is 2P reserves divided by 2020e production where LAK Ranch is excluded
from the calculation; 3) Reserves certified by Chapman Petroleum Engineering Ltd. as of 31 December 2019, except Illinois Basin which are certified by PeTech Enterprises as of 31 December 4
2019
Maha has delivered consistent production growth
Strong production growth track record, which is expected to continue into 2021 Comments
Production rate by field, kboepd § Since acquiring the Tie field in 2017
Maha has delivered significant
Substantial increase production growth through drilling,
in Mafraq production
18,000 forecasted following
well reactivation, and waterflood
field development
16,000 § Tartaruga represents another
success with more than tripled
Potential production
14,000
increase from acquiring
Mafraq1) – key production since 2017 through
remaining 25% of Tartaruga contributor to horizontal drilling and workovers
12,000 medium term
growth
§ Further growth from Tie and
10,000
Tartaruga is expected in 2020-21
Illinois Basin – on back of recent completed
8,000 Significant production increase increasing processing capacity expansions
achieved for Tie and Tartaruga production from and drilling more wells
6,000 2021 onwards
3,700-4,000 Tartaruga – stable
4,000 3,445 production with § Illinois Basin and Mafraq expected
3,044
further potential to be important contributors to
1,804 production growth medium term,
2,000 916 following low risk, phased
Tie - core developments
0 contributor to
…
reserves and
e
e
e
e
e
20
17
18
19
20
21
22
23
24
25
20
20
20
20
20
production
20
20
20
20
20
1/
H
Tie Field Tartaruga Tartaruga (+25% WI) + additional drilling Illinois Basin Ma fraq
Source: Company estimates. Forward looking financials and production for Maha in this presentation assumes adequate funding sourced
Note: 1) Subject to final ratification of Sultani Decree 5
Maha’s organization is built to be a highly efficient operator
Experienced management and board A lean, solid operator organization
Jonas Lindvall (CEO & board member)
§ 30 years in international upstream and founder of Maha Administration • ~ 6 emp. (IT & compliance outsourced)
§ Experienced with emerging markets, notably as country manager for Tethys Oil in Oman
§ Petroleum Engineer with senior positions within technical and management Finance • ~10 emp.
§ B. Sc. in Petroleum Engineering, Master Degree in Energy Business
HR • ~ 4 emp.
Alan Johnson (VP Operations) HSE • ~ 4 emp.
§ >25 years in int. upstream oil & gas
D&C • ~ 11 emp. (2 consultants)
§ Experience includes varied technical, managerial and executive roles in drilling,
production, reservoir, reserves, corporate planning and asset management
Management
§ B.Eng (1st Class) (Hon) Operations • ~ 26 emp. (3 consultants)
E&P • ~ 3 emp.
Andres Modarelli (CFO) Brazil: ~ 49 emp. (32 field based) | North Am.: ~ 15 emp. (3 field based)
§ 20 years experience within finance and accounting from small cap E&P
companies
§ B. Commerce and BBA degrees, chartered public accountant (CPA)
Bench strength across all key disciplines backed with
international experience
Jamie McKeown (VP E&P) Access to well trained and experienced labor markets
§ >30 years experience from international E&P
§ Operational Geologist active in Africa, M.E., USA
All major service companies available in Brazil as well as
§ Petrophysics/geosteering/wellsite expert strong local providers
§ B.Sc. in Geology
Strong HSE focus - DuPont STOP safety program
implemented
Seasoned board with extensive background from the oil & gas industry and finance Core technical skills of asset management, business
development and corporate finance centralized in Calgary
§ Chaired by Harald Pousette, CEO of Kvalitena
Board
Board of directors
Industrier AB, has broad experience from finance and real § Harald Pousette § Anders Ehrenblad Top quartile operating expenses achieved in Brazil
estate § Jonas Lindvall § Seth Lieberman
§ Includes inter alia Nick Walker, current COO of Lundin § Nick Walker § Fredrik Cappelen
Energy and President and CEO from 1 January 2021
6
Conservative operational strategy centered around value and
stable production opportunities
Ensuring stable production and near term lower risk developments are key to Maha’s operational strategy
50% - Production base
40% - Low risk development
Core strategy to optimize and develop
existing production base
Move resources into reserves and
Geographical and asset diversification production
to mitigate political and operational risk
EOR expertise employed to increase
Current portfolio ensures stable production and exploit low hanging fruit
production base and predictable cash 10%
flow Appraisal and near field exploration
Ensure future cash flow generation with
short lead time and payback Limit to low risk near field exploration –
selective approach
Funded through free cash flow
Jurisdictional and asset concentration risks mitigated by establishing
geographical diversification and low risk, operated phased developments
7Corporate responsibility is core in Maha
A wide range of initiatives to ensure safe and efficient operations while minimizing pollution
E Tie Tartaruga LAK Ranch & Illinois Basin
ü Gas to wire project allows electricity generation ü Located on the coast – operations set up to ü Reduced discharge to zero (100% water
Environmental with gas that would otherwise be flared (aims to minimize disruption to local wildlife and habitat recycling)
reduce flaring to zero and increase oil recovery)
efforts to ü Instead of traditional rig, short mast rig was ü Zero gas flaring implemented
ü Zero water discharge. All water is recycled as used to minimize light pollution during turtle
minimize pollution part of water injection scheme nesting season
ü Special pump jacks to allow simultaneous
irrigation activities and oil production
ü Important source of gas to local community ü Impermeable mats protect against spills
S A year of safe operations
HSE committee
Focus on efficient
and safe
established in 2016
to review operations 3
and HSE lost time incidents recorded during
operations management 2019 - 80% complete on corporate
systems wide implementation DuPont™
STOP™ safety system
External Internal
G
Listing in Stockholm
Strict Internal governance
ensures transparency
governance in reporting – targeting
guidelines to guide
important decision making
move to OMX Main
processes
Market in Q4 2020
8Contents
I. Introduction to Maha Energy
II. Asset overview
III. Financial overview
IV. Supporting material
9Tie Tartaruga Mafraq Illinois
Material and diversified production and reserve base
Reserves Asset locations Production
mbbl kboepd
70
18
Tartaruga
60 16 upside2)
E
D
50 14
40 9 USA 12 Mafraq1) 3)
C
3
Oman 10
30
13 8
20 45 Illinois basin1)
Brazil B 6
3.7-4.0 Tartaruga1)
10 20 A
4 3.0 3.4
0 1.8 Tie1)
2 0.9
Tie Tartaruga Illinois LAK Total
Basin Ranch 0
’17 ’18 ’19 1H ’20e ’21e ’22e ’23e ’24e ’25e
’20
A Tie B Tartaruga C Mafraq3) D Illinois Basin E LAK Ranch
§ Bahia, Brazil § Aracaju, Brazil § Central Oman § Illinois, USA § Wyoming, USA
§ Onshore § Onshore development § Onshore § Onshore § Onshore
§ 100% working interest § 75% working interest, § 100% working interest § ~96% working interest § 99% working interest
§ Operator potential process to acquire § Operator § Operator § Operator
remaining 25% from partner
§ Core asset, proven Maha’s Petrobras § EPSA awarded in Q4 2020 § Acquired March 2020 § Legacy asset, cash neutral
operator capabilities § Familiar jurisdiction, low § Overlooked asset,
§ Operator
effort development plan w/ opportunity grow production
§ Strong asset, improved attractive entry point and value organically
economics from
contemplated acquisition
PRODUCTION BASE HIGHLY ECONOMIC DISCRETIONARY DEVELOPMENTS NON-CORE
Note: 1) As per Company estimates 2) Includes aquisition of additional 25% working interest and drilling of additional wells 3) Subject to final ratification of Sultani
Decree 10Tie Tartaruga Mafraq Illinois
Tie – Maha’s flagship asset
Material producer with strong cash flow generation and a low risk growth outlook
Introduction Key facts and location
§ Maha acquired 100% ownership from Gran Tierra in 2017 Ownership: 100%
§ Since the acquisition, production and 2P reserves are up 123% and 91% Acquisition: 2017
respectively as a result of: License expiry: 2039
1. Drilling the Tie-1 well – flow tested 2,932 boepd (best well ever for Discovered / 2009 /
onshore Brazil) production start 2010
2. Commenced waterflood in 2017, to halt natural decline API: 36-38°
3. Reactivated GTE-3 (dead well) as dual producer; tested a combined STOOIP: 37 mbbl (8% rec.)
rate of 1,166 boepd 2P reserves: 19.8 mboe1) (91% oil)
§ Current production of ~3,000 boepd with production plateau to reach 5,300 Opex 2020 / LoF : USD ~5 /Tie Tartaruga Mafraq Illinois
Development overview – production of ~5,300 boepd by Jan ’21
Capital and development plan
Objective: Revitalise field and grow production / reserves Optimise long term exploitation with 5,300 boepd plateau
2018 2019 2020 2021 2022
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 H1 H2
Recompletion Drilling Tie-1 well Comboata Oil DAX refinery GTE-4 well: Drill Tie-2 Drill water Drill Tie-4 (prod.) and Drill Tie-6 (prod.), Tie-7
of zones in Terminal starts increases offtake Conversion to (prod.) and Tie- supply well and Tie-5 (water inj.) and Tie-8 (both water inj.)
Increase in
GTE-3 well taking oil deliveries to 3,000 bopd dual artificial lift 3 (water inj.) continue
offtake contracts
system ramping up
Production facilities upgraded Complete gas
water injection
(H2’18 – 2019) reinjection
facilities
2010’s 3D Seismic re-processed
Capex USD 22m USD 27m USD 18m
(over 2018 – H1’20) (planned over H2’20 – 2021) (planned 2022)
2P reserves Corporate goal to move current 2P reserves into existing 1P category in
+91% to 19.8 mboe1) (per YE’19)
the next five years via development drilling and waterflood
Processing Completed gas reinjection facilities
+150% to 5,300 boepd to get full operational flexibility to overcome flaring / offtake restrictions
capacity
Production 5,300 boepd Maintain 5,300 boepd plateau for 5 years
+123% to 2,788 boepd (from 2017 to H1’20) (planned ramp-up)
Proven, low risk conventional development - Maha operated with 100% WI providing full control over largely discretionary capex program
Source: Company estimates
Notes: 1) Excluding 1.983 mboe produced since time of acquisition 12Tie Tartaruga Mafraq Illinois
Low cost production with attractive netbacks
Comments Netback: Illustration of main components at USD 45/bbl
USD/bbl
§ Estimated opex of USD ~5/bbl currently, expected to improve to USD 45 8Tie Tartaruga Mafraq Illinois
Tartaruga – significant reserve base and organic growth outlook
Producing asset with transformational growth potential
Introduction Key facts and location
§ Located in the Sergipe Alagoas Basin onshore Brazil Ownership:
75%, operator
25% Petrobras
§ Maha acquired 75% ownership and operatorship in early 20171)
Acquisition: 2017
- Remaining 25% currently for sale by Petrobras (partner) – Maha intends
to submit offer License expiry: Q3 20252)
Discovered / 1994 /
§ Since 2017 acquisition, production and 2P reserves are up +480% and
production start 1995
200% respectively, as a result of:
API: 41°
1. First application of horizontal technology in the Penedo formation
Gross STOOIP 108 mboe (1% rec.)
2. Successful hydraulic stimulations applied
Net 2P reserves: 13.2 mboe3)
3. Unique implementation of hydraulic jet pumps for artificial lift
Opex H1 2020 /
USD 19/12 per boe4)
§ Current production of ~700 boepd with a planned increase to 3,600 boepd5) LoF :
- Produces from 1 of the 27 zones in the Penedo stacked reservoir.
Net production4)
Another 3 zones have tested positive for oil
boepd
- To date four production wells including 1 sidetrack have been drilled. Two 4,000
wells currently producing and 1 well is awaiting completion Extension of license expected, subject to
3,600 submission of field development plan
3,200
- Fully covered by 3D seismic, which was reprocessed in 2018 Field shut in for
Oil & gas split
2,800 workover program
97% oil
- Three new production wells planned drilled through 2023, lifting 2,400
3% gas
production to ~3,600 boepd5) 2,000
1,600
1,200 H12020
574 boepd
800
400
0
'15 '16 '17 '18 '19 '20e '21e '22e '23e '24e '25e '26e '27e '28e '29e '30e '31e '32e '33e '34e
Additional 25% + WI drilling Production includes drilling TTG-4
Notes: 1) Acquired from PVEP, TDC & UPP; 2) Extension expected, subject to submission of full field development plan; 3) Chapman Petroleum Engineering Reserve Report, as of 31.12.2019
4) Source: Company estimates and six month 2020 report includes third party transportation and processing costs 5) On gross 100% basis assuming successful acquisition of additional working 14
interstTie Tartaruga Mafraq Illinois
Development overview – phased ramp up to 3,600 boepd2) by
‘23
Capital and development plan
Objective: Evaluate long term development potential and grow
Execute development plan
reserve base
2018 2019 2020 2021 2022 2023
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q1 Q1 H2 Q3-4
H2
Started drilling Workover of well 7TTG Spud Maha-1 Test of Test of Upgrading Bring Maha-1 Drill new Drill new Drill new
horizontal sidetrack completed, adding ~600 Maha-1 well at 107D horizontal Maha-1 Facilities to on production production production well production well
of well 107D boepd initial production. well target successfully 2,900 boepd Acquire remaining well – TTG-4 – TTG-5 – TTG-6
Horizontal sidetrack of depth completed, flowing 25% from Petrobras2) (horizontal) (horizontal) (horizontal)
996 boepd Gas-to-Wire project to
well 107D completed handle additional gas
production completed
Capex USD 28m USD 16m1) USD 22.5m
(over 2018 – H1’20) (planned over H2’20 – 2022) (planned 2023)
2P reserves
200% to 13.2 mbbl (per YE’19)
Processing +24% to 1,000 boepd oil currently Future expansion required to 3,600 boepd2) and possibly more depending on appraisal program
capacity
Production
+580% to 574 boepd (from 2017 to H1’20) 2021 up to ~2,000 boepd 2023 up to ~ 3,600 boepd2)
De-risked, phased development approach, where Maha as operator is in control
Source: Company estimates, numbers based on assumed 100% working interest
Notes: 1) Excludes acquisition cost for additional 25% working interest 2) On gross 100% basis assuming successful acquisition of additional working interest 15Tie Tartaruga Mafraq Illinois
Robust operating margins, with upside as production is
ramped up
Comments Netback: Illustration of main components at USD 45/bbl4)
§ Estimated opex of USD 12/bbl – includes 3rd party transport/handling/storage USD/bbl
45 3
and sales costs 45 11
40
§ USD 19/bbl operating netback at USD 45/bbl Brent (before capex and 35 12
corporate tax) 30
25
- Discount of USD 3/bbl due to periodic assessment of quality 19
20
- Oil is trucked 65 km to the Polo Atalaia oil terminal in Aracaju, and 15
thereafter shipped to market, with associated gas sold through GTW 10
project at a price of USD ~0.75/kscf 5
0
Brent Discount Royalty Opex Netback
§ Attractive fiscal terms
- 9.7% royalty to Brazilian State1), 1% to local landowners and overriding
royalty to Petrobras of 10% on gross production2)
Operating netback sensitivity to oil price
- Net income tax of 15.25% through 2029 due to extendable tax rate
USD/bbl
incentive3) 45
- Historic losses reduce taxable income by up to 30% in any given year 40
35 31
30 27
25 23
• If Company is successful in acquiring remaining 25% WI – The royalty will 19
20
decrease from 24% to 10.7%. 15
15 12
10 8
5
0
30 35 40 45 50 55 60
Brent price (USD/bbl)
Notes: 1) Measures have been introduced in Brazil to reduce royalties by up to 5 percentage points; 2) In effect the total royalty therefore is 24% (9.7% + 1% + 10% / 75%)
3) Incentive of 18.75%, reducing the applicable tax rate from 34% to 15.25% 4) Assumes total royalty of 24% to government and Petrobras 16Tie Tartaruga Mafraq Illinois
Mafraq1) – a well defined, phased and operated oil development
in Oman
Field introduction Key facts and location
§ Maha entered Block 70 in October 2020 as operator with 100% WI
Ownership: 100%
- The Maha team has significant experience from Oman through previous
Acquisition: October 20202)
work on Block 3, 4 and 15
License 2023: Exploration
§ Block 70 is located close to other major established oil fields, and contains the expiry: 2035: Production
Mafraq oil discovery made in 1988
Discovered 1988
- A lower risk oil development project with attractive economics
API: 13°
§ Mafraq is significantly de-risked through extensive seismic, a total of five wells
drilled, including a long-term production test flowing > 15,700 bbls of oil on a STOOIP 185-280 mbbls
22 day test
§ Planning a phased development approach
- Enabling full de-risking of the project with limited capital commitment, and Production forecast through phased development process3)
benefitting from cash flow from early production system
bopd
- Operatorship provides full control of scope and timing of investments 10,000
§ Production regime is a Production Sharing Agreement. Allows for up to 30% 8,000
Government back in before Declaration of Commerciality
6,000
4,000
2,000
-
'20e '21e '22e '23e '24e '25e '26e '27e '28e '29e '30e '31e '32e '33e '34e '35e '36e
1) Subject to final ratification of Sultani Decree 2)Signing of EPSA 3) Source: Company estimates
17Tie Tartaruga Mafraq Illinois
Low-cost development in a phased approach to de-risk project
and reduce funding requirement
Capital and development plan
2020 Phase 1 Phase 2 Phase 3 Phase 4 2025:
Plateau production phase
Q4 2020: Q2-Q4 2022:
H1 2021: Q3 2021: Q1 2023: Q2 2024:
EPSA signed1) Drill horizontal Q2 2024:
Establish office Drill 2 data wells to 1 exploration Start development
and organization establish oil water wells. Expected Declare
well
contact and test produce peak production commerciality
Q4 2020:
an expected 300 bopd 3,000 bopd (DoC) if applicable
Effective Date
of EPSA1)
Production
0 to 1,250 bopd (2021/22 peak) up to 3,000 bopd (2022 peak rate at testing) up to 9,000 bopd (2025)
Early production system Further production result of discretionary capex spend
Capex
USD 14.6m USD 31.8m USD 38.0m
(over 2021 – 2022) (planned over 2023 - 2024) (planned 2025)
Initial of committed capex to establish production of up to ~3,000 bopd. Later investments fully discretionary and dependent on production results
2P + 2C
Estimated 23.3 mbbl (subject to ratification by Sultani Decree)
Source: Company estimates, all figures on 100% working interest basis
Note: 1) Subject to final ratification of Sultani Decree. 18Tie Tartaruga Mafraq Illinois
Illinois – low-risk reserves acquired at an attractive entry-cost
with a clear plan to ramp-up production to 1,200 bopd
Field introduction Key facts and location
§ Conventional oil field acquired in March 2020 from Dome Energy, Ownership 96.2%1)
producing 160 bopd light oil net to Maha Acquisition: March 2020
§ Attractive entry-price of USD 4m (up-front cash consideration) vs. 2P License expiry: Varied2)
NPV10 at YE‘19 of USD 31m based on a USD 57 WTI flat price Production start: 2013
§ Development plan to increase production to 1,200 bopd at plateau Cumulative production: 409 kbbls
API: 35°
- Initial plan of drilling production wells annually for a period of 5 years
(annual capex of USD +/- 7.8m) 2P reserves: 2.9 mbbls3)
USD 10 / 10
- To be followed by drilling to maintain production Opex 2021 / LoF :
per boe
- Significant capex flexibility
Production forecast and key milestones
- Large drilling inventory with over 100 drill locations bopd
1,500 2022 2023 2024 2025
§ Realized prices at only USD 3/bbl discount to WTI 1,200
900
§ Netback (including capex) of around USD 18/bbl in USD 40/bbl (WTI) oil
600
environment
300
0
- Based on USD 3/bbl discount to WTI, USD 9.3/bbl royalty (25%) and
'20e '21e '22e '23e '24e '25e '26e '27e '28e '29e '30e '31e '32e '33e '34e '35e
opex of USD 10/bbl
2020 2021 2022 2023 2024
2020-21
Optimization
wells wells wells wells
Commence
Acquisition development
programme
1) 3.8% of land held has secondary partners, remainder is held 100%; 2) Majority held by production, some subject to continuous drilling clause 3) Illinois Basin acquired
March 31, 2020. Reserves as per competent person’s report delivered by PeTech Enterprises as of 31 December 2019 19Contents
I. Introduction to Maha Energy
II. Asset overview
III. Financial overview
IV. Supporting material
20Conservative profile with strong cash flow and quick payback
Focused on value-creation while maintaining a prudent financial strategy
§ Tie field underpins production with field plateau of ~5,300 boepd expected for five years
Producing fields
generate substantial § Low unit costs with opex of USD ~7/boe as of H1/20 across fields result in high netbacks
cash flow § Generates strong long term cashflows
§ Cash flow from producing fields is re-invested in accretive developments
Selective approach
§ Focus on short investment with short lead time to cash flow/payback
to developments
§ High degree of discretion over capex due to operatorship and phased development approach
Conservative § Solid balance sheet and a conservative capital structure
financial policy and § Diversification is key with multiple producers in several jurisdictions
risk profile § Planned capex of ~USD 100m2) over the 2021-2023 period funded by operating cash flow, debt proceeds and cash on hand1)
Notes: 1) Company estimates, based on 2P profile at USD 45/bbl 2) Excluding acquisition costs
21Strong historical cash flow generation and performance
Key historical financials Comments
§ Maha has delivered solid financials in recent years,
supported by growing production and low cost operations,
benefitting from economics of scale and increased
operational efficiency
- EBITDA in the range of USD 20-36m p.a. with strong
cash conversion
- Robustness of business underlined by still healthy
results and margins in a challenging macro environment
in H1’20 and Q2’20
§ Operating cash flow has funded material capex program
related to facilities upgrade in Brazil and drilling and
workovers in Brazil and US, significantly increasing Maha’s
long term production capacity
- With facilities upgrades largely done, going forward
Maha can increasingly focus capex on near term
production and cash flow growth initiatives with quick
payback
§ A strong balance sheet has been maintained with ow net
debt
§ In 2020, a further increase in production is expected, with
production of 3,700-4,000 boepd
Notes: 1) As stated in press release, 15 October 2020; 2) Excluding changes in working capital; 3) Excluding acquisition cost. USD 4.2m spent on Illinois Basin acquisition in H1 2020
22Contents
I. Introduction to Maha Energy
II. Asset overview
III. Financial overview
IV. Supporting material
23Proven track record of executing high value business
development opportunities
Historical milestones
2019: 7TTG workover
2013: Maha 2017: Completed the at Tartaruga completed
(Canada) and Maha acquisition of the 2018: Commenced major with dedicated jet pump
(US) were Tartaruga field, workover program on Tie and add ‘pay behind
2015: Maha drilled three onshore Brazil. 75% and Tartaruga fields pipe’ (900 bopd)
incorporated 2014: Maha new ‘horizontal’ wells and
acquired the 2016: Completed IPO WI and operatorship
Acquired 60% of the drilled two vertical wells at GTE-3 well recompleted Successfully drilled of
remaining part of the (Nasdaq OMX First Ran Jet Pump in 107D with jet pump at Tie –
working interest (WI) LAK Ranch 107D horizonal
interest in LAK North) in newly created well and doubled immediate 900 bopd
in the LAK Ranch Swedish Maha AB and sidetrack, tested > 600
Ranch, to 99% WI Maha located and tested a production of field to production increase bopd free flowing from
heavy oil field new alternate pumping raised SEK 108m (USD 310 bopd Maha previous pumped well.
systems to replace the 12.6m) listed on First Facility upgrade at Tie
PCP and beam pumps at North increases handling capacity Drilled TTG-3 new well.
Maha drills 3 LAK Ranch, yielding a 50% from 2,000 bopd to 5,000 Testing suspended due
‘horizontal wells’ higher pump efficiency bopd to COVID-19
and starts CSS
operations on LAK
2013 2014 2015 2016 2017 2018 2019 2020
2015: Company 2017: Issued SEK 2019: Attic well drilled and 2020: Acquisitions of Illinois Basin
2013: Equity issued with 2017: Entered into an
2014: Two equity issue booked its’ first 300m senior brought onto production at (160 bopd). 2P +/- 2.9 mbbls. Will
net proceeds of SEK Agreement with GTE to
of common shares Reserves. 2P secured bond Tie grow US presence
11.3m (USD 1.8m) acquire all GTE assets in
amounting to USD 19.2 reserves : 12.8 kbbls
Issue of units (common Brazil, incl. Tie field in Offtake contracts at Tie GTE-4 well recompleted with jet pump
Brazil increased to 4,850 bpod and at Tie
shares and warrants) of
SEK 16.7m (USD 2.6m) 2,850 kscf gas per day Signed EPSA for Block 70 in Oman.
Directed share issue of Estimated 23.3 mbbl (subject to
SEK 92m (completed in Maha recieves environmental
licenses to implement gas-to- ratification by Sultani Decree)
February 2017)
wire projects Finished Tie upgrade; gas reinjection.
Rights issue of SEK 92m
due in May 2017
24Board of directors with substantial industry experience
Board of directors
Harald Pousette Anders Ehrenblad
Chairman of the board Board member
§ Currently the Chief Executive Officer of Kvalitena Industrier AB and has § Works in investment, financial and management consulting
substantial experience from finance and real estate § Broad experience from various private companies including Investment
§ Chairman of Norrfordon Holding AB, Bil Dahl AB,Bil- och Traktorservice i Manager and partner of Graviton AB, Board Member of RF Coverage AB, AB
Stigtomta AB, Jitech AB, and Board member of Stig Svenssons PiaCare and Maven Wireless AB.
Motorverkstad AB and companies in the Kvalitena Group. § Masters of Science in Business Administration from University of Uppsala,
§ Bachelor of Arts (Economics) from the University of Uppsala, Sweden Sweden
Nicholas Walker Seth Lieberman
Board member Board member
§ Over 30 years of international experience in the upstream oil & gas industry § Member of EQT Real Estate Funds I & II investment committee and the
§ Senior executive/management positions across Europe, Africa, Asia and the Chairman of Kvalitena AB (publ) and a number of its’ subsidiaries, including
Americas including Bow Valley Energy Inc., Talisman Energy Inc., Africa Oil
Huski Chocolate and Svenskt Industrifly
Corp. and Lundin Petroleum AB
§ Has held senior roles at Advanced Capital’s Real Estate Fund, UBS
§ Current COO of Lundin Energy and President and CEO from 1 January 2021
Investment Bank, Hypo Real Estate, Lehman Brothers International, Credit
§ BSc in Mining Engineering from Imperial College London, MSc in Computer
Suisse and GE Capital
Science from the University College London as well as an MBA from the City
§ Holds a Bachelor of Arts in Economics from Tuft University, USA
University Business School in London
Jonas Lindvall Fredrik Cappelen
Board member Board member
§ Seasoned senior executive with 30 years of international experience in the § Currently the managing director and majority shareholder of M25 Industrier
upstream oil & gas industry across Europe, North America, Africa and Asia AS and Vinfos AS and Director of Sikri AS, Proxll AS and Proterm AS
§ Started his career with Lundin Oil during the early days of E&P growth § Prior work experience includes Head of Sales at Arctic Securities AS, before
§ After 6 years at Shell and Talisman Energy, Mr. Lindvall joined, and helped in
which he held several senior management positions at SEB, including Head
securing the success, of Tethys Oil AB.
of Sales and Head of Corporate Finance in Norway
§ Holds a B.Sc. in Petroleum Engineering and a Masters Degree in Energy
§ Bachelor of Arts in Business from Regents University in the United Kingdom
Business from the University of Tulsa.
25Shareholder overview
Largest shareholders as of 30 June 2020 Comments
% OF
NUMBER OF
OUTSTANDING
§ Swedish investment company Kvalitena AB a highly supportive investor, is
MAJOR SHAREHOLDER
SHARES HELD the largest shareholder with 21.0% of the shares
SHARES
KVALITENA AB 21,288,327 21.03% § Jonas Lindvall committed through 4.7% equity ownership
FÖRSÄKRINGSAKTIEBOLAGET, AVANZA PENSION 5,399,263 5.33% § High degree of free float ensures liquidity in the underlying shares
JONAS LINDVALL (Maha CEO) 4,761,147 4.70%
BNY MELLON NA (FORMER MELLON), W9 2,252,897 2.23%
ÅLANDSBANKEN I ÄGARES STÄLLE 2,151,053 2.12%
NORDNET PENSIONSFÖRSÄKRING AB 1,329,646 1.31%
IBKR FINANCIAL SERVICES AG, W8IMY 1,246,552 1.23%
SYDBANK I ÄGARES STÄLLE 1,116,284 1.10%
BNY MELLON SA/NV (FORMER BNY), W8IMY 985,301 0.97%
SAXO BANK A/S CLIENT ASSETS 982,407 0.97%
SUB TOTAL 41,512,877 41.00%
Remaining Shareholders 59,737,937 59.00%
TOTAL MAHA A AND MAHA B
101,250,814 100%
26Stockholm Calgary
Strandvägen 5A Suite 240, 23 Sunpark Drive SE
SE-114 51 Stockholm Calgary, Alberta T2X 3V1
SWEDEN CANADA
Phone: 08 611 05 11 Phone: 403 454 7560
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