GROWING WITH MEXICO IN A NEW ERA OF ENERGY REFORM

Transcription

1 GROWING WITH MEXICO IN A NEW ERA OF ENERGY REFORM, ROE.WT January 2016

2 Forward Looking Statements Certain information in this Presentation may constitute "forward looking" information or "forward-looking" statements within the meaning of Canadian securities legislation, including, but not limited to, statements with respect to Renaissance Oil Corp. ( Renaissance or the Company ) becoming a major operator in Mexico with the three blocks awarded to the Company forming a solid foundation to grow the Company. Forward-looking statements are statements that are not historical facts; they are generally, but not always, identified by the words expects, plans, anticipates, believes, intends, estimates, projects, aims, potential, goal, objective, prospective, and similar expressions, or that events or conditions will, would, may, can, could or should occur. Forward-looking statements are based on the beliefs, estimates and opinions of the Company s management on the date the statements are made and they involve a number of risks and uncertainties. Consequently, there can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Except as required by the securities disclosure laws and regulations applicable to the Company, the Company undertakes no obligation to update these forward-looking statements if management s beliefs, estimates or opinions, or other factors, should change. Factors that could cause future results to differ materially from those anticipated in these forward-looking statements include, but are not limited to, the failure to receive regulatory approval for the issuance of the shares, the risks associated with the bidding process and satisfaction of any prequalifying criteria, and such other risks as disclosed in the Company s management discussion and analysis and other continuous disclosure filings. Although the forward looking information and statements contained in this Presentation are based upon what management of Renaissance believes are reasonable assumptions, Renaissance cannot assure readers that actual results will be consistent with the forward looking information and statements. In particular, this Presentation contains forward looking information and statements pertaining to the following: the treatment of Renaissance under the regulatory regimes and laws of the jurisdictions in which Renaissance conducts its business; drilling and completion of wells; operating and capital costs and the timing and method of funding thereof; timing of development of undeveloped reserves; Renaissance's future oil and natural gas production levels; the future performance and characteristics of Renaissance's oil and natural gas properties; the estimated size of Renaissance's potential oil and natural gas reserves; projections of market prices and costs; supply and demand for oil and natural gas; expectations regarding the ability to raise capital and to continually add to reserves through acquisitions, exploration and development activities; future capital expenditure programs and the timing and method of financing thereof. With respect to forward looking information contained in this Presentation, Renaissance has made assumptions regarding, among other things: future prices for oil and natural gas; future currency and interest rates; Renaissance's ability to generate sufficient cash flow from operations; access to debt and/or equity financing to meet its operating costs and future obligations; and Renaissance's ability to obtain qualified staff and equipment in a timely and cost-efficient manner to meet Renaissance's demand. The actual results could differ materially from those anticipated in these forward looking statements and information as a result of the risk factors set forth below and elsewhere in this Presentation: volatility in market prices for oil and natural gas; the potential for the return of conditions persisting during the recent global crisis and economic downturn; liabilities inherent in oil and gas operations; uncertainties associated with estimating oil and natural gas reserves; competition for, among other things, capital, acquisitions, undeveloped lands and skilled personnel; incorrect assessments of the value of acquisitions; geological, technical, drilling and processing problems; fluctuations in foreign exchange or interest rates and stock market volatility; changes in the laws or application thereof by the Governments of the jurisdictions in which Renaissance conducts its business; business plans and strategies; capital expenditure programs and the timing and method of financing thereof; the ability of Renaissance to achieve drilling success consistent with management's expectations; net present values of future net revenues from reserves; future production levels of Renaissance's assets; timing of bringing on production; expected plans and costs of drilling; drilling inventory and presence of oil pools or gas accumulations; supply and demand for oil and natural gas; ability and costs of increasing plant capacity; expected levels of royalty rates, operating costs, general and administrative costs, costs of services and other costs and expenses; and expectations regarding the ability to raise capital and to continually add to reserves through acquisitions, exploration and development. The forward-looking information contained in this Presentation is expressly qualified by this cautionary statement. 2

3 Why Mexico? rare opportunity and a new era Mexico holds some of the world s largest oil and gas resources 77 years of PEMEX monopoly now ended: Lack of capital reinvestment and slow adoption of modern drilling & completion technology has led to an underdeveloped resource Mexico is undergoing sweeping reform to liberalize its oil & gas industry: Considerable acquisition and growth opportunities Renaissance is the only publicly listed pure oil & gas play in Mexico 3

4 Why Now? the opening of a world class hydrocarbon provenance in a low oil price environment is an exceptional opportunity PEMEX s lower revenues increases need for partners Talented executives & highly technical staff available Most juniors and mid-tier oil companies are preoccupied Mexico Government has favorably revised terms 4

5 Renaissance Story 2014 Pure Play on Mexican Energy Privatization Raised $5 million Engaged Halliburton extensive experience in Mexico 2015 Advised by Marcos & Associates Established Key Industry Connections Hired Strong Technical Team Raised $10mm equity & USD $20mm, loan facility Awarded 3 top oil fields in onshore block auction 5

6 Auction Results Round 1 - Call 3 Mature Field Auction, Dec. 15, 2015 Renaissance awarded its top 3 targeted blocks Renaissance s winning bids within 2.5% of 2 nd place for each block Renaissance's awarded blocks represent 44% of Original Oil in Place available for Type 1 blocks in the auction (Type 1: <100 million Bbls oil in place)

7 Awarded Blocks Mundo Nuevo, Topén & Malva Currently 650 bbls/d gross oil production 140 million bbls original oil in place* 46 million bbls recovered to date Significant additional production growth opportunities through work-overs and horizontal drilling. 12 drilling locations identified 25 year licence contracts, with two possible five year extensions Minimum work program within the USD$16mm performance bond required * Volume estimates were publically disclosed by the Mexican government as part of the auction and were not prepared by a qualified reserves evaluator in accordance with the Canadian Oil and Gas Evaluation Handbook ("COGEH") or National Instrument Standards of Disclosure for Oil and Gas Activities ("NI "). Renaissance will have a third party evaluation conducted on each block this year by a qualified reserves evaluator and will provide the results publically when available.

8 Mundo Nuevo Multiple work-over opportunities and new drilling locations identified to significantly increase current production levels Discovered in wells drilled Produces natural gas and 56 API condensate & natural gas liquids (NGLs) Peak production of over 15,000 bbls/d of NGL and over 100 mmcf/d natural gas in early 1980s Currently gross production: 130 bbls/d NGLs 2.5 mmcf/day natural gas 86 million bbls original oil in place* 35 million bbls oil recovered 3D seismic coverage across the block = existing well * Volume estimates were publically disclosed by the Mexican government and were not prepared by a qualified reserves evaluator in accordance with the COGEH or NI

9 Topén Work-over candidates and infill development drilling opportunities, potential major untested reserves in the south Discovered in wells drilled Produces medium 29 API oil Peak production of over 1,500 bbls/d of oil and 3 mmcf/d natural gas in mid 1980s Currently gross production: 280 bbls/d oil 1.7 mmcf/day natural gas 40 million bbls original oil in place 8 million bbls oil recovered 3D seismic coverage across the block = existing well * Volume estimates were publically disclosed by the Mexican government and were not prepared by a qualified reserves evaluator in accordance with the COGEH or NI

10 Malva Infill development well opportunities with and work-overs to existing wells, 2 potential untested new areas Discovered in wells drilled on the license Produces light 36 API oil Peak production of over 2,000 bbls/d of oil and 15 mmcf/d natural gas in late 2000s Currently gross production: 270 bbls/d oil 1.7 mmcf/day natural gas 13 million barrels original oil in place 3 million barrels oil recovered 3D seismic coverage across the block = existing well * Volume estimates were publically disclosed by the Mexican government and were not prepared by a qualified reserves evaluator in accordance with the COGEH or NI

11 Significantly Under Developed Relative to the Rest of North America Extensive undeveloped opportunities in Mexico create an ideal environment for the growth of a significant oil and gas company Renaissance will soon be one of the first independent oil field operators in Mexico Successful bidding in December licensing round has significantly increased access to further business development opportunities 11

12 MEXICO S 5 YEAR PLAN 900+ blocks are designated for auction 600+ located onshore 107 Billion BOE remaining in place offshore + onshore* 178,554 KM 2 (44 million acres) Multi-Zone Opportunities Undeveloped Shale Potential Vast Field Reactivation and Expansion Opportunities Renaissance Areas of Interest Tampico-Misantla Basin Sureste Basin Tampico Misantla Basin holds over 50% of Mexico`s oil resources - with less than 1% recovery to date Sureste Basin contains numerous mature fields that have received virtually no reinvestment * Source: Comisión Nacional de Hidrocarburos 12

13 Renaissance Next Steps 2016 Finalize License Contracts for 3 Awarded Blocks Leverage our new role as a Mexico operator to further business development opportunities Prepare for Call 5 Chicontepec & Shales Commence minimum work program and field development 13

14 Technical Team DANIEL JARVIE, CHIEF GEOCHEMIST Globally recognized as a leading analytical and interpretive organic geochemist, having evaluated conventional and unconventional petroleum systems around the World Former Chief Geochemist of EOG Resources, Inc., largest shale oil producer in North America Most notably, completed the independent geochemical analysis for Mitchell Energy, in their development of the Barnett Shale of the Fort Worth Basin, in Texas Mr. Jarvie has been the author of many award winning industry papers and in 2010, Mr. Jarvie was awarded Hart Energy s Most Influential People for the Petroleum Industry in the Next Decade Adjunct professor at Texas Christian University (TCU) and a member of the Energy Institute and Affiliate professor at the University of Oklahoma Bachelor of Science from the University of Notre Dame and mentored in geochemistry by Wallace Dow and Don Baker of Rice University NICK STEINSBERGER, DIRECTOR OF ENGINEERING 22 years experience in petroleum engineering, drilling, production, and surface facilities Completions Manager for Mitchell Energy and responsible for drilling of first 25 wells in the Barnett Shale, Nick was Integral to the growth of the company until its sale to Devon Energy for $3.1 Billion First to recommend and implement slick water fracs in the Barnett Shale, transforming it from a marginal play to one of the largest gas fields in the USA reaching peak production of 5.75 Billion Cubic Feet per day in 2012 As horizontal team leader for Devon Energy, he designed the first horizontal completions in shales that are now used industry wide Completed over 900 wells in the Barnett Shale and 300+ in other petroleum plays across North America Bachelor of Science, Petroleum Engineering, registered Professional Petroleum Engineer, Texas 14

15 Technical Team DAN STEWARD, SENIOR GEOLOGIST With 48 years experience in the petroleum industry, has spent over 20 years evaluating the Barnett Shale and widely considered an expert in conventional and unconventional reservoir evaluation Leading member of Mitchell Energy s Barnett Shale team and important contributor to the success of the shale play, as well as the $3.1 billion sale of the Company to Devon in 2002 Thereafter, applied his in-depth understanding of source rocks to evaluating resource plays within the U.S., such as the Marcellus & Mount Pleasant shales, as well as Canada, South America, China & the U.K Selected by the American Association of Petroleum Geologists (AAPG) for their 2007 Explorer of the Year award for role in establishing the Barnett as one of the largest producing gas fields in the United States and the model for shale resource plays worldwide In 2012, honoured as one of the Legends of Unconventional Wildcatters by the Houston Geological Society, and received the Monroe G. Cheney Science Award for his work in the Barnett Shale (AAPG) in 2013 KENT BOWKER, SENIOR GEOLOGIST With over 35 years experience in the oil & gas industry Kent is widely recognized as a global industry expert in the geology and engineering of unconventional oil & gas reservoirs In 1998, while with Chevron Kent was recruited by Mitchell Energy management to join Barnett Shale Team, where he ultimately played an integral role in the successful development of the resource play and Mitchell Energy His technical analysis directly led to the realization that the Barnett Shale held nearly four times more gas than previously determined, ultimately increasing Mitchell s proven reserves from 500 Billion Cubic Feet to 2.5 Trillion Cubic Feet of natural gas between 1999 & 2002 Since 2002 sale of Mitchell Energy, Kent has had continued success in discovering hydrocarbons in several more U.S. sedimentary basins, and is further engaged in evaluating petroleum systems globally 15

16 Technical Team CAROL A. LAW, SENIOR GEOLOGIST Over 30 years experience in the petroleum industry; leadership, strategic decision making, exploration geology, research, and consulting in a variety of geological settings worldwide Recent four years dedicated to leadership roles in early stage, high growth focused oil and gas companies Experience in exploration activities in more than 40 countries and has been a team member responsible for discoveries in Mozambique (Rovuma Gas), Ghana (Jubilee), Brazil (multiple Campos Basin discoveries), Alaska (Nikaitchuq), China (Bohai Bay), Gulf of Mexico and others Former roles include Exploration Manager East Africa and Caribbean for Anadarko Petroleum Corporation and a number of senior exploration positions with Kerr McGee and BP/Amoco JAY PARK, INTERNATIONAL PETROLEUM LEGAL ADVISOR 27 years of legal advisory experience and widely considered a leading authority on global petroleum regimes Managing Partner at Park Energy Law providing legal expertise on a wide array of global energy projects Managing Partner at Petroleum Regimes Advisory Past Partner and Chair of the Global Resources Practice Group with Norton Rose Canada. Extensive experience in Mexico, having previously advised PEMEX on the development of innovative services contracts Specialty includes oil & gas asset acquisitions & divestments, share acquisitions & divestments, advising on production sharing agreements, concession agreements, product marketing, gas sales & purchase contracts, pipeline transportation matters, oil and gas pipeline asset dispositions and drafting legislation in over 40 other countries 16

17 Technical Team ANDREW FOULDS, SENIOR PETROPHYSICIST Petrophysicist, with over 35 years international experience, in reservoir evaluation both in the service sector and within global oil companies Senior Petrophysicist for ExxonMobil, evaluating shale, carbonate and clastic formations globally including North Africa, East Africa, South America, Ukraine, Mediterranean, North Sea, UK, Indonesia, Canada, India and Poland Expertise in planning cost effective integrated petrophysical analysis programmes for all types of reservoirs, including unconventional resources, tight oil & gas, shale oil & gas, oil shale, and CBM, as well as difficult reservoirs such as low contrast plays, thin bed analysis and complex lithology/fluid reservoirs STEPHEN P. CUMELLA, SENIOR GEOLOGICAL ADVISOR Extensive geological and geophysical experience with major producers and, most recently, with small entrepreneurial companies in North America, Latin America and Off-shore Africa Former Senior Geologist with Endeavour International, Bill Barrett Corporation / Barrett Resources and Exploration Geologist for Chevron / Chevron International 35 years of experience with established record of materially increasing production over various basins Directed all geological operations for Bill Barrett Corporation s Piceance Basin development program, production increased from 30 MMcf/d when the property was acquired in 2004 to 180 MMcf/d in 2010 Directed budget of several hundred million and all geological operations for Barrett Resources/Williams Production RMT in the Piceance Basin, increasing production of 100 MMcf/d in 2000 to 300 MMcf/d by 2004 Worked with team to develop geologic model for Lake Maracaibo Blocks VI and VIII reservoir characterization projects, recommendations to PDVSA resulted in over 40,000 BOPD increased production 17

18 Technical Team RANDALL L. MILLER, GEOLOGY AND COMPLETIONS ADVISOR Over 35 years experience specializing in integrating geology, petrophysics, fracture stimulation and production analysis for optimizing the exploitation of unconventional reservoirs Division Vice President of Integrated Reservoir Solutions of Core Laboratories, a World leader for providing proprietary and patented production enhancement and reservoir management services Globally renowned industry speaker, instructor and conducted and directed over 50 large joint industry projects 18

19 Key Personnel IAN TELFER, Lead Director Co-founder and major shareholder of Renaissance Oil. Corp. Chairman of the Board, Founder & Past President of Goldcorp. Inc. Ernst & Young Entrepreneur of the Year, former Chair of the World Gold Counsel and recently inducted to the Canadian Mining Hall of Fame CRAIG STEINKE, President & Chief Executive Officer Co-founder and major shareholder of Renaissance Oil. Corp. Former Chief Executive Officer of Realm Energy International Corporation Over 20 years of extensive experience in the global oil & gas industry KEVIN SMITH, Vice President Business Development 20 years of experience in the financial services industry and oil & gas investment banking raising capital for junior energy companies Professional roles with Paradigm Capital, Macquarie Capital Markets Canada Ltd., HSBC Securities (Canada) Inc., and Nesbitt Burns Inc. JEREMY CRICHTON, Chief Financial Officer Extensive experience in senior financial capacities with natural resource companies Vice President of Fiore Management & Advisory Corp. Previously in the audit practice of Deloitte and Touche LLP. 19

20 Advisors The only Mexican financial and business development consultant specializing in the Mexican energy industry ERNESTO MARCOS Former Chief Financial Officer of PEMEX Former President of Nacional Financiera, Mexico's development Bank Former Undersecretary for the Secretary of Energy Former Adjunct Governor of the World Bank, the International Financial Corporation LUIS LABARDINI Former Senior Advisor to the CFO of PEMEX, Former Deputy Director for Trade Financing, Mexican Ministry of Finance Former Deputy Director for Foreign Investment, Mexican Ministry of Finance M.A. from Yale University, and an M.S. in Management from MIT ANTONIO PRINCE 25 years with Schlumberger, working internationally in sixteen countries Expertise in business development, bidding, negotiation and contract management Excellent reputation and extensive contacts within the Mexican oil and gas industry Chemical Engineer with 28 years of experience in the global oil and gas industry 20

21 Share Structure SHARE STRUCTURE WARRANTS ROE.WT - TSX-V ROE - TSX-V: $0.215 (January 8, 2016) Basic Shares Outstanding: million Basic Market Capitalization: $34.4 million Options (avg. strike $0.27): 15.0 million Tranche 1: ROE.WT - TSX-V Outstanding: 19.2 million Strike price $0.50 per share, expiry July 2019 Tranche 2: Outstanding: million Strike price $0.20 per share, expiry October 2020 Application for listing of Tranche 2 warrants expected to be submitted at end of hold period, February 2016 FD SHARES million CASH BALANCE $37 million cash and restricted cash DEBT $28 million loan facility 21

22 Goldcorp Experience in Mexico 2002 No Reserves, No Revenue $10 Million Market Capitalization No Mexican Employees Invested $3 Billion in Mexico $10 Billion Market Capitalization Largest Gold Producer in Mexico Over 6,000 Mexican Employees 22

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