This Is

Velvet Energy

  • Velvet Energy has updated its corporate presentation. You can find the link at the bottom of our homepage at https://t.co/A1fMyQT09F. 11 months ago
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  • Velvet employees had the opportunity to participate in the  @CSPGeologists  "Sweat the Subsurface" 5km+10km run! Velv… https://t.co/CrVpgknSF7
    3 months ago

  • Velvet's Chairman of the Board is a great advocate for our men and women at sea in the Royal Canadian Navy. https://t.co/SiCuYEb9Op
    3 months ago

  • For the past school year, Velvet had the privilege of volunteering with  @PLougheedCBE  to promote learning outside t… https://t.co/a2959uKhE3
    4 months ago

  • We hosted a group of shareholders, directors, bankers and analysts for a tour of our Montney light oil operations i… https://t.co/3deyHXzMxq
    6 months ago

  • Shoutout to our CFO Chris Theal who proved work-life balance is possible by placing 1st in his age category in the… https://t.co/UNMSt9ZIZu
    6 months ago

Engagement

Velvet is an organic growth company. We apply best-in-class geoscience and commercial skill to build large and contiguous tracts of land in, and adjacent to, oil-window source rocks. State-of-the-art prospecting, drilling, completions, and production methods allow us to generate top decile economic returns.

CORPORATE PROFILE
MEET THE TEAM

Velvet Energy Operations

Velvet’s operations are focused in the light oil window of the Montney in Alberta and northeast B.C. and in the liquids rich window of the Deep Basin of Alberta. The Company produces 14,000 boe/d from the liquids rich Ellerslie formation which spans from West Pembina to Whitecourt. Velvet has over 15 years of Ellerslie and stack development inventory to continue to sustain or grow this high rate of return asset.

The Company has drilled 26 gross/net wells in the black oil window of the Montney in the Karr/Gold Creek area of northwest Alberta. With the acquisition of Iron Bridge Resources Inc. in 2018, Velvet now controls 230 net sections of land at Karr/Gold Creek, where it produces 17,000 boe/d.  The company also has a portfolio of early phase exploration lands, targeting Montney light oil at Pouce and Flatrock, B.C. Two wells were drilled at Pouce in 2018, with one well tied in during September last year.

EXPLORE OPERATIONS

Chronology of Growth

2019

• Divested non-core assets in the Pembina area and reallocated portion of proceeds to replace sold production with light oil weighted Montney volumes

•  Increased corporate liquids weighting to 47% and plan to exit 2019 at 50% with ongoing Montney light oil development

•  Achieved cumulative hedging gains of $100 million as at September 30, 2019, including $26 million in realized gains year-to-date 2019

ve_chronology-growth-2017-a

2018

• Successfully completed unsolicited takeover of Iron Bridge Resources, adding 49,600 net undeveloped acres of land at Gold Creek

•  The acquisition was fully funded with equity from existing shareholders and monetization of midstream facilities acquired in the transaction

• Expanded Montney light oil inventory with successful horizontal wells at Karr and Pouce Coupe

• Corporate production reached 30,000 boe/d and increased proved plus probable reserves to 170.2 million boes at year-end

• Established land position in fourth Montney light oil window property at Flatrock, B.C.

ve_chronology-growth-2017-a

2017

• Pivotal shift in capital allocation to our Montney light oil project at Gold Creek. Completed facilities installations and brought on first production at Gold Creek in June 2017

•  Achieved 20,000 boe/d milestone in mid-2017, all organic growth

•  Added US$50 million of term debt to our existing second lien notes

• CPPIB joined as a new equity investor with $150 million investment

ve_chronology-growth-2017-a

2016

• Drew a total of $65 million equity in the first half

• Completed the 15-7 Montney oil well at Gold Creek

• Doubled Gold Creek acreage to 195 net sections

• Closed US$125 million Senior Secured Second Lien financing and drew $30 million of equity in 3Q2016

• Accelerated development at Edson to two rigs and commenced 3-well winter program at Gold Creek

ve_chronology-growth-2016-a

2015

• Closed a new $100 million equity line with our New York investors in 1Q2015

• Completed construction of a 54mmcf/d fit-for-purpose gas and NGL plant at Zeta Creek in our Edson core in 3Q2015

• Drilling activity in 2015 supported filling our 40% equity interest in the plant at start-up

ve_chronology-growth-2015-a

2014

• Acquired Lightstream assets in West Pembina for $72.2 million in 1Q2014

• Drew $105.6 million of equity to fund the acquisition and expanded Ellerslie delineation program

• Achieved 10,000 boe/d milestone in May 2014

ve_chronology-growth-2014-a

2013

• Drew $50 million of equity in 2Q2013 to fund a multi-zone evaluation of the Deep Basin stack

• Brought our first liquids-rich Ellerslie horizontal well onstream at 1,250 boe/d in West Pembina

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2012

• Acquired Vero Deep Basin gas assets for $200 million in 1Q2012

• Drew $110 million of equity to fund the acquisition

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2011

• Velvet closed a C$355million equity line with three New York-based investors in 2Q2011

• Drew $70 million of equity at closing

ve_chronology-growth-2011-a

2019

2018

2017

2016

2015

2014

2013

2012

2011

2Q2011
1Q2012
4Q2012
2Q2013
4Q2013
1Q2014
3Q2014
4Q2014
1Q2015
3Q2015
4Q2015
Q12016
2Q2016
3Q2016
Q42016
Current

2Q2011

Closed C$355mm Equity Line at $10.00/sh. Drew $70MM of equity

1Q2012

Acquired Vero Deep Basin assets for $200.5MM. Drew $110MM of equity

4Q2012

Velvet Energy Ltd. Production Growth

2Q2013

Drew $50MM of equity. Concluded multi-zone evaluation of Deep Basin stack. Brought 16-14 Ellerslie hz onstream.

4Q2013

Velvet Energy Ltd. Production Growth

1Q2014

Acquired Lightstream Assets in Pembina for $72.2MM. Drew $75MM of equity.

3Q2014

Completed 1st Montney well and commenced Zeta Creek Plant design. Drew $30.6MM of equity.

4Q2014

Velvet Energy Ltd. Production Growth

1Q2015

Closed new $100MM equity line at $13.75/sh

3Q2015

Completed construction and filled equity interest in new 54mmcf/d fit-for-purpose gas and NGL plant at Zeta Creek. On time and on budget.

4Q2015

Velvet Energy Ltd. Production Growth

Q12016

Drew $15MM of equity.

2Q2016

Edson development accelerated with 2nd rig. Additional land acquisition opportunities in Gold Creek. Drew $50MM of equity.

3Q2016

Completed 15-7 oil well in the Montney at Gold Creek. Doubled Gold Creek landholdings to 195 net sections via asset & Crown land acquisitions.

Q42016

Closed US$125MM Senior Secured Second Lien Financing. Drew $30MM of equity.

Velvet Energy Ltd. Production Growth

Current

Velvet Energy Ltd. Production

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Investor Presentation

VIEW PRESENTATION
Investor Contacts

Chris Theal, Chief Financial Officer

Careers

We’re always looking for talented people to join our team. At Velvet, we value our employees and recognize them as the driving force behind our success.

LEARN MORE

Contact

We are located in the downtown core in Calgary, but you can keep up with what is happening at Velvet by following us on LinkedIn or Twitter.

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