Groundbirch Lands – Strategically Positioned at the Crossroads of West Coast LNG Supply Network

Directly offsets Shell’s, CNRL’s Groundbirch Montney and Crew’s West Septimus development.

Optimal land position in Montney infrastructure crossroads – egress to LNG Canada Project & Coastal GasLink LNG pipeline, currently under construction, and to western and eastern energy markets. TC Energy North Montney Mainline extension intersects Aduro lands.

Opportunity for direct access to North American gas markets (AECO) prior to LNG export at lower transportation cost than current fee structure.

Ownership of facilities and infrastructure between Peace and Pine Rivers provides competitive advantage.

 

Existing Production and Reserve Base

100% current production is operated; 99% average WI in pipeline and facility infrastructure.

21 wells owned and operated with current production of 2.1 MMcf/d; majority of production contribution from the Montney Formation.

Booked 2P reserves of 5.8 MMBOE net to Company.

Majority of 2P reserves attributed to the Montney Formation.

 

Strategic Gas Gathering Infrastructure in Place

Company owns and operates two gas facilities with total capacity of 35 MMcf/d and over 100 Km of an associated gas gathering system.

Facilities consist of compression, dehydration and liquids separation.

Ability to bring additional Montney wells on immediately and determine longer term production performance in a shorter cycle time.

Gas facility currently generating additional third party gas processing revenue.

 

Montney Formation Delineated by One Horizontal and Six Vertical Wells on Company Lands, Four Montney Horizontal Wells on Adjacent Land, and Offset Well Control

Montney horizontal wells from adjacent land are tied into the Aduro gas facility that generates third party revenue for the Company. These Montney wells further validate gas & liquid potential on Aduro assets.

Porosity ranges from 3.5% to 6.5%.

Montney on Company land base is 21% to 31% over pressured.

 

Two horizons of Upper Montney development plus Middle and Lower Montney.

Proposed current development scheme of 2 mile lateral horizontal wells in the Upper Montney.

Prospective Upper Montney section up to 155 metres thick.

 

Montney Horizontal Well Performance Determined by Industry Well Performance, Company Well Performance, and Large Database of Offset Montney Wells

Significant upside sensitivity to increased well IP rates and gas price.

Wells qualify for Deep Gas Royalty Credit.