This document is confidential and for internal use only. Under no circumstances are its contents to be reproduced or distributed to the public or the press. The information contained herein, while obtained from sources that we believe to be reliable, is not guaranteed as to its accuracy or completeness. This confidential information summary is for information purposes only and does not constitute an offer to sell or a solicitation to buy securities.
CONIFER EXPLORATION LTD. CORPORATE DIVESTITURE MARCH 2009 Investment Highlights ♦ ♦ ♦ ♦ ♦ ♦ ♦
800-1,200 BOE/d oil volume upside on low risk development drilling locations at Redwater Current production of 209 BOE/d (113 bbls/d of oil and NGLs and 575 Mcf/d of natural gas (W.I.)) An additional estimated 30 BOE/d (W.I.) of tested production awaiting tie-in P+P reserves of 977 MBOE (37% natural gas) High working interest lands; approximately 35,000 gross acres (26,513 net) with an average W.I. of 75% 30+ (25 oil) drill ready development locations and 25 exploration locations with significant upside Strong balance sheet with working capital surplus of $3.3 million as at March 1, 2009
Table of Contents Section
Page
Investment Highlights
1
Property Overview
2
Property Maps
3
Reserves Summary
4
Production and Cash Flow
5
Production
6
Property Summaries
7-10
Upside and Exploration Prospects
11-14
Corporate Overview Capitalization Summary (in millions) Basic shares outstanding (MM) Stock options Performance warrants Fully diluted shares outstanding (MM) Exercise price of options Exercise price of warrants (1) Working Capital Surplus: (2) Current assets (MM) Current liabilities (MM) Working capital surplus (MM) (1) (2)
Operating Summary - Year Ended September 30 23.0 2.2 7.7 32.9 $1.00 $1.25-$2.75 $5.3 (1.2) $4.2
Warrants may be cancelled upon change of control. As at December 31, 2008; working capital surplus = current assets - current liabilities.
Officers and Directors Gerald Perry
President & CEO, Director
Gerry Elms
VP, Finance & CFO, Director
Darrell Osinchuk
Vice President, Engineering
Daryl Gilbert
Director
Paul McGarvey
Director
Gary Simpson
Director
PETERS & CO. LIMITED
2007 Production (BOE/d) Net revenue ($M) Cash flow ($M) Capex ($M) Operating costs ($/BOE) Operating netback ($/BOE)
2008
75 $1,137 $591 $5,622 $4.78 $21.77
169 $3,490 $3,041 $5,616 $6.96 $35.33
Tax Pools estimated as at Dec. 31, 2008 (000’s) COGPE CDE CEE UCC Share issue costs Non-capital losses Total
$2,246 2,832 5,074 1,169 4 4,252 $15,576
Corporate Information KPMG LLP
Auditor
Bank of Montreal
Banker
McDaniel & Associates Consultants Ltd.
Reserves Engineer
Burnet, Duckworth & Palmer LLP
Legal Counsel
3900 Bankers Hall West, 888 3rd Street SW Calgary, Alberta, Canada T2P 5C5 www.petersco.com
Conifer Exploration Ltd. March 2009
Property Overview Plains ♦ ♦ ♦ ♦ ♦ ♦
Current production of 76 BOE/d Assigned P+P reserves of 522 MBOE with B-tax 10% value of $11.9 million 15+ (net) unbooked Viking oil horizontal multi-stage frac locations at Redwater Attractive economics under current price environment Working interest varies from 40% to 80% Several early stage farmin opportunities, and one farmin commitment
Central ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦
Current production of 68 BOE/d Assigned P+P reserves of 285 MBOE with B-tax 10% value of $5.4 million 13-18-45-7W5 Belly River new pool discovery with offset drilling potential Behind pipe Ellerslie gas at Willesden Green Unstimulated Pekisko gas pay at Markerville (11-25 re-entry) 16-24 Pekisko development location directly offsets 11-25 at Markerville 12 medium depth farmin locations identified Three high impact gas plays identified on Conifer lands
North Central ♦ ♦ ♦ ♦ ♦ ♦
Current production of 65 BOE/d Assigned P+P reserves of 169.6 MBOE with B-tax 10% value of $2.1 million Development locations at Teepee and Leland Multi-zone downspacing, 13-18 location at Leland Uphole uncompleted Cadotte gas at Karr Two exploration oil plays at Kaybob East (Jurassic) and Calais (Montney)
2 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Property Maps R6
R4
R2
R26
R24
R22
R20
R18
R16W5
TEEPEE DUNVEGAN
T74
T74 CALA S N
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CALA S MONTNEY STURGEON FALHER
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KARR – MULT ZONE
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Conifer Properties
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North Central
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R23
R23
R22
R22
R21
R21
R20
R20
R19
R19
FL
L
R18W4
R18W4
3 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Reserves Summary Reserves Summary - Escalated Price Forecast (McDaniel & Associates Consultants Ltd. March 31, 2009 Reserves Report) Reserves Category
Crude Oil (Mbbls)
Proved – developed producing Proved – non-producing Proved – undeveloped Total Proved Probable Total Proved Plus Probable
($M) Reserves Category Proved – developed producing Proved – non-producing Proved – undeveloped Total Proved Probable Total Proved Plus Probable
Natural Gas (MMcf)
NGLs (Mbbls)
118 3 171 292 264 555
38 0 0 38 19 57
Total Equivalent (MBOE)
1,259 127 0 1,385 802 2,187
365 24 171 560 416 977
Summary of Oil and Natural Gas Reserves Estimated Net Present Values Before Income Taxes Discounted at 10% 15% $8,010 $6,827 196 141 2,934 2,385 $11,140 $9,353 8,212 6,293 $19,352 $15,645
Proved Plus Probable Reserves - by Property (McDaniel & Associates Consultants Ltd. March 31, 2009 Reserves Report) (1) Area
Crude Oil (Mbbls)
Redwater Markerville Karr Pembina Willesden Green Leland Gilby Teepee Total
NGLs (Mbbls)
522 28 6 555
15 30 10 1 57
Reserves Contribution by Area 8%
5%
Natural Gas (MMcf) 852 601 253 254 227 2,187
Estimated NPV B-Tax 10% B-Tax 15% (M)
522 157 130 80 48 39 977
$11,853 2,833 1,480 1,995 600 661 (21) (50) $19,352
10%
3%
Redwater
3%
Markerville 13%
53% 16%
$9,617 2,213 1,187 1,695 433 564 (19) (44) $15,645
B-Tax 10% NPV Contribution by Area Redwater
4%
Total Equivalent (MBOE)
Karr
Markerville 8% 15%
61%
Karr
Pembina
Pembina
Willesden Green
Willesden Green
Others
Others
(1) Utilizing McDaniel & Associates Consultants Ltd. Jan. 1, 2009 forecast prices.
4 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Production and Cash Flow Production (McDaniel & Associates Consultants Ltd. March 31, 2009 Reserves Report) 450 400
Production (BOE / d)
350 300 250
Current Production: 209 BOE / d
200 150 100 50 0 2009
2010
2011
2012
2013
2014
2015
PDP
2016
Proved
2017
2018
2019
2020
2021
2022
2023
2022
2023
P+P
Operating Cash Flow Before Future Capital (McDaniel & Associates Consultants Ltd. March 31, 2009 Reserves Report) $8,000.0 $7,000.0
Cash Flow (MM)
$6,000.0 $5,000.0 $4,000.0 $3,000.0 $2,000.0 $1,000.0 $0.0 2009
2010
2011
2012
2013
2014 PDP
2015
Proved
2016
2017 P+P
2018
2019
2020
2021
5 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Production Production Summary - Year Ended September 30 2007 Average
2008 Average
2009 Current
Exit
Natural gas (Mcf / d) Oil & NGLs (bbls / d) Total (BOE / d)
377 12 75
870 24 169
895 41 190
575 113 209
% Natural gas
84%
86%
78%
46%
Current Production by Area Total Equivalent (BOE/d)
Area Redwater Markerville Pembina Leland / Karr Total
31%
36% 19%
76 28 40 65 209
13%
Redwater
Markerville
Pembina
Leland / Karr
Historical and Forecast Production 250
(BOE/d)
200 150 100 50 Jan - Mar
Apr - Jun
Jul - Sep
Oct - Dec
Jan - Mar
Apr - Jun
2007
Jul - Sep 2008
Natural Gas
Oct - Dec
Current 2009
Oil & Liquids
6 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Plains — Redwater Property Summary Highlights ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦
♦ ♦
R21W4
R20W4
High quality 32 API long RLI lower Viking Oil Offsetting verticals have cumulative oil of 40 Mbbls Initial production at 75-85 bbls/d per horizontal frac well Analogous pool in 56-21W4 using multi-leg horizontals T56 OOIP on Conifer lands estimated at 25 MMbbls Estimated 3.75-5.0 MMbbls ROIP at 15-20% recovery with new technology 15+ net horizontals based on two wells per higraded quarter 800-1,200 BOE/d production upside on low risk drilling locations T55 Holdings approved for multi-well horizontals R21W4 R20W4 Well depth of 650 meters vertical with 600-800 meters horizontal section Redwater - Rate vs Time (3 Leg Hz Wells) Drill and case costs of ~$850,000, complete & tieWells from 56, 57-21W4 in costs of ~$475,000 1000 1,750 net undeveloped acres, including Conoco Conifer 11-4-56-20W4 Single Hz (Multi-Stage Frac) farmin lands Final Conoco farmin earning well deferred until 100 after break-up to capture drilling incentive credits available after April 1, 2009 Average W.I. of 58%, including farmin lands 3 Leg Hz Wells - No Multi-Stage Frac Additional farmin opportunities identified 10
T56
T55
Calendar Daily bbls/d
♦
Redwater (Viking) vertical and hz oil wells produce from lower shoreface/lag deposits. Hz drilling and Multi-Stage Fracs have revived drilling activity within the Redwater Viking Pool. Full development will involve 2-3 hz wells per 1/4 section and completed with Multi-Stage Fracs.
1 0
3
6
9 12 Producing Month
15
18
Redwater Summary Current Production (1) W.I. Oil & W.I. Gas W.I. Total NGLs (bbls/d)
(Mcf/d)
(BOE/d)
76
0
76
Total Proved
Reserves (2) Proved + Total Probable Proved
(MBOE)
272
Land Proved + Probable
Developed
(B-tax 10%)
522
$5,865
$11,853
Average Working Interest
Undeveloped
Developed
(Net acres)
168
Undeveloped (%)
1,750
53%
59%
(1) Volumes include the 1st farmin earning well on Conoco lands (2) Reserves include 2 farmin earning wells on Conoco lands; 1st well (14-16) is PPDP and 2nd well (4-21) is PPUD
7 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Central — Markerville Property Summary Highlights ♦ ♦
♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦
Pekisko sweet gas production close to infrastructure Well 11-25: ♦ producing at 370 Mcf/d with upside from unstimulated gas pay (40% W.I.) ♦ short directional re-entry would provide incremental daily volumes ♦ in pressure communication with Markerville Pekisko A, E, and G pools Well 16-24 has an estimated production potential of 800-1,000 Mcf/d Estimated 2-5 Bcf RGIP for each of the wells Well 11-25 on freehold land, 16-24 on crown land Updip development location at well 16-24 lies within periphery of the “A” pool Well depths of 2,350 meters TVD with 400-600 meters of directional drilling Costs: drill and case - ~$1,925,000, completion & tie-in - ~$600,000 256 net undeveloped acres Two farmins identified 60% W.I. partner owns proprietary 3D
R3
R2
R3
R1W5
R2
JUG EC JG E22 E EEE 23 E 21 F JF FD E E C E F E
G GV
G
24
A FC
F G 19
U
FG 20 JC
R1W5 A C
F
F
G D C
21
22
F F Harvest
Harvest 3D G J FE K FC F G G seismic
L3D Siesmic
23
G
F 24
F V FC A FG
V
20
FC U F G F F
21
R28W4 23
22
L JGG F CE E G IE 15E FE F E K JD 14 F J16 I KE I E JC G E J G I G W C 9 11 I S10 E G
15
T36
19
F
A
13
G 18 G
17
12
7
8
C
T34
Conifer Land
Shallow / Medium Rights (40%)
A
1
36
Drilling Location
R2
R3
R2
R1W5
6
5
31
32
G CG
25
30
24
19
13
18
C 12
7
29
G
20
T35 T35
G
1
6
35
36
36
W
C 26
25
F24GF
25
C G
23
C
14
C GG C G 12
11
G G C 12 G C
C 2
36
C35 G C C
25
26
T34
13
Lduc 1
T34
FC G
C 13
G
24
F
G 1
C
Deep Rights (100%)
R3
T36 T36
T35
A
20
C J
Markerville G Pekisko A, E and G Pools UG 200+ Bcf OGIP
Pksk
A
F
24
JF
V
V D FD C 13FD 16 14 17 15 13 18 17 C 18 F F AG14 FGUV JF G F J G F F T36 G F F F V FC A A G F F CF FG G F 11UF 9 10 G 11 12 9F 10 12 7 8 F 8F F 7 GF GU F FFC V F GF KF F F F F C F FLV F F V U LV G G F F F G F EF I JF J F F V G EF F 5 G FC F 3 K 3 2 6 5 3 2 2 G V CC 1 F FD6UF F F F F L F F I4 V4 F G E4 V F 1 F C F C G V F G F C C F CGFC C V FF V G F F V F G F VF F C FD F G I G G F G FV CF G F 31F F FG 32F F35 FC F 36FF 33 34 F 35 33 34 35 36 31 32 33 34 G F F AA G G V F F G GL V G G G J J UC F F U G G 11-25-35-3W5 F G F FC 29 F G27 GJ28 26 28 27 26 FU 30 28 27 F 26G 25 30 29 F F 25 C I GD G F J V U L G VV F D G F G J CU G F F LF F G F G20 JF I EF G22 G23 21 22 23 24 19 20 22G 24 19 V KC V V 21 G F FG23 G C21G U F J L F E G E FD F F V J J G FUG T35 FU GF JF FJ U G JC FI F F C FE M A J 16 G F 16 F C G17 I I 16 JF J 15JG E CG 14 A 15 14 13 18 13 18 G A14 J15 G C17 IE JI J IC I JK K F G JV EG FU G FC F G V C D C G J JG JE J EJGUI G C JE U U CE L J J J E E JL F F F C G 16-24-35-3W5 G E C E VV F J I9 J J 12F F 11 F G E10 E IC11 G G F 9 10 11 7 8 9 12 7 8 JI F 10 JG I J JF E UEG I E E IE F G U E C KE J JC E E V V F F JF E E EI G G G E I E J J JL G A JG C4 KE E3 GU 3 2 1 IC 6 2 5 F 4 F 3 2 1 6 5 J J4 J E E D A I J J E JE I FI J E JD W G J V J JG J J GV C JF C J IE JI G J GFDD U G J 33 E G34 F 33 35 35 34 32 J 36 31C 32 33 34 35 36 31 JE E J FG F F G CJ J E J E G C F J J JE C E J J J IE E E I JF E JF F V F E E I F J 28 V 26 FC 27 26 29 28 27 26 25 30 29 J E 28 C 27 E V E E E25 E 30 CK GV J J JC VD C JE E G U J J G C EJ LE GE J G G FI E G E E F F GF22 F V G 22 21 23 23 24 19 20 21 G 19 20 G 21 23 24 J E IE 22 E E E G G G EJ G T34 E E J G E E C CE GG E FE C C 15 G 16 14 15 18 17 16 18 17 16 15 14 13 GU 14 J 13 K E G IE E G E F C E G J G G FC FG F JE IE FE E C C G K C 9 10 11 11 9 10 12 8 7 8 9 10 12 7 G K 11 K E EE FE L G F JE G U E C F F C JE J 4J E JE G 3 2 1 4 G 3 2G 6 3 2 1 5 C 5 EU4 CU JEG G6 G G IC E JE JGU I J JG C I G C GG C V G G G U G C FD C G C E 33 EF JE G JE C35 G 34 34 34 35 33 36 31 32 35 36 31 32 G33 C C JU G EIEE C G F GV F C C GC T33 E G A C V G J G C GV G J G G F U 26 G 28 28 27 26 25 29 25 30 29 30 27 26 C V G J J 27 U28 C U VEF F D F F F C C C C G G V IE 16 G E C
F
FGV G
JE IC
C 19
C F
C
36
T33 G
25
C
R29W4
R1W5
11-25-35-3w5
Unstimulated perfs.
Markerville 11-25-35-3W5 (Pekisko) produces from ramp carbonates within the Pekisko A Pool (155 Bcf), a downdip gas water interface is defined in 16-35-35-3W5 at -1377m.
Markerville Summary Current Production W.I. Oil & W.I. Gas W.I. Total NGLs (bbls/d)
(Mcf/d)
(BOE/d)
5
138
28
Total Proved
Reserves Proved + Total Probable Proved
(MBOE)
100
Land Proved + Probable
Developed
(B-tax 10%)
157
$2,065
$2,833
Average Working Interest
Undeveloped
Developed
(Net acres)
256
Undeveloped (%)
256
40%
40%
8 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Central — Pembina / Willesden Green Property Summary Pembina Highlights ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦
R10
R9
13-18 (70% W.I.) new pool discovery in Lower Belly River One well currently producing 180 Mcf/d of gas and 20 T45 bbls/d of oil Cumulative production to date of 43 MMcf of gas and 6 Mbbls of oil Exhibits a production profile indicating proximity to a gas/ T44 oil interface Analogous X3X pool in 45-7w4 has produced 350 Mbbls of T43 oil and 2.5 Bcf of gas Several potential offsets exist within 13-45-8W5 (70% W.I.) and 18-45-7W5 (100% W.I. natural gas rights) Potential water flood candidate with further downdip R10 drilling Offset location licensed in 10-13 from 13-18 surface Well depth of 1,350 meters TVD at Belly River Costs: drill and case - ~$750,000, complete and tie-in ~$350,000 2,400 net undeveloped acres
R8
R7W5 T45
T44
T43
R9
R8
R7W5
13-18-045-07W5 New Pool Discovery
Willesden Green Highlights ♦
One well (90% W.I.), offsets 14-2 analog which has cumulative production to date of 0.2 Bcf ♦ Tested at 200 Mcf/d with a short tie-in ($400,000) ♦ Expected reserves of ~150-300 MMcf
High Impact Prospects ♦
Three 3D defined Devonian seismic stratigraphic plays using well re-entries (100% W.I.) ♦ 9-15-44-9W5 Banff (90% W.I.) The Conifer Pembina (Belly River) new pool oil & gas discovery at 13-18-45-7W5/02 is located within a Lower Belly River channel complex in close proximity to the analogous X3X Pool. The 13-18 discovery well has twice the pay (4.3m) versus the X3X Pool (2.0m). Pembina / Willesden Green Summary Current Production W.I. Total
Total Proved
(BOE/d)
40 (1) Shallow rights only
Reserves Proved + Total Probable Proved
(MBOE)
73
Land (1) Proved + Probable
Developed
(B-tax 10%)
128
$1,541
$2,595
Average Working Interest
Undeveloped
Developed
(Net acres)
688
3,472
Undeveloped (%)
86%
94%
9 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
North Central — Leland Property Summary Highlights ♦ ♦ ♦ ♦ ♦
R27
1-18-59-25W5 produces liquids rich gas from multiple zones Well depths of 3,100 meters Working interest of 9% Holdings submitted for multi-zones Operated by Milestone Exploration
R26
R24W5
R25
T60
T60
T59
T59
T58
T58
Upside ♦
Perf uphole Cadotte zone in 1-18-59-25w5 ♦ Down spacing 13-18-59-25W5 with Falher, Gething, and Cadotte potential ♦ Drill & case costs of ~$3,100,000, complete costs of ~$900,000 ♦ Offsetting operators using Multi-Stage Frac technology
R27
R26
R24W5
R25
North Central — Karr Property Summary R3
Highlights ♦ ♦ ♦ ♦ ♦
Four long life producing wells from multiple zones within Cretaceous sandstone reservoirs Working interest of 11-17% Operated by Canadian Natural Resources Ltd. Excellent infrastructure Farmin opportunities offsetting
R2
R1W6
T66
T66
T65
T65
T64
T64
T63
T63 R3
R2
R1W6
Leland and Karr Summary Current Production W.I. Total
Total Proved
(BOE/d)
65
Reserves Proved + Total Probable Proved
(MBOE)
116
Land Proved + Probable
Developed
(B-tax 10%)
170
$1,741
$2,141
Average Working Interest
Undeveloped
Developed
(Net acres)
424
Undeveloped (%)
0
9-14%
9-14%
10 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Upside and Exploration Prospects Exploration and Development Upside (1) Development Conifer Land 29 Plays
(Thousands of dollars) Minimum capital required Risked capital required Risked I.P. rate P50% reserves (MBOE) Risked capital efficiency ($/BOE/d) Risked F&D ($/BOE)
Conifer Land 6 Plays
$15,195 $19,063 879 1,577 $21,677 $12.09
Exploration Farmin / Crown 17 Plays
$1,682 $3,212 244 355 $13,152 $9.04
Total
High Impact 2 Plays
$7,329 $12,636 461 813 $27,406 $15.55
54 Plays
$1,850 $2,182 207 378 $10,541 $5.77
$26,056 $37,093 1,792 3,123 $20,703 $11.88
(1) All plays risked quantitatively, identifying chance of success, reservoir, source, seal / traps and hydrocarbons.
Central — O’Chiese Exploration Prospect Summary Highlights
♦ ♦ ♦ ♦ ♦
Curr Licensee: ENCANA CORP Orig Licensee: ENCANA CORP Status: Gas,Prod Prod Zone(s): BNFF
Unit Code: Pool Code: Field: On Prod:
NORTHROCK GULF FERRIER 16-3-4402/16-03-044-10W5/0 March 11, 2009
N/A 644001 FERRIER November 22, 1998 0.001 1.0E6
1.0E5
♦
R11
R10
R9
R8
R7W5
R10
R9
R8
R7W5
FG F G FC F UU C U G FU E F F F G FCE E CU G F UG F F FC F FC EUE FU U G K F F F F G F F U G I C GC F F G F FF F F G UC G G I I FD G IUI F U F F E F JL C G F U G U F F DU D VKF F U G F CUFF FG G F T45 T45 C W C E FE F VF GE F F G F F G K GU G FL G J G E U U A G G F U F F G C F G G F D K FD FGU G F G D C C F GA G 1G 6G G F6 F FU U 6 1 F L F G EU FCG F 6 1 FL C U FU F U 1 F UU F F F F G U GG L F F GU F C F F F FU GU F G G A UF F GG G G F C F F D C U G F36 F F31 C G F 31 C 36 FU 31 36 D 31GF FU 36 G C F G FU G G C GC F FU F F FU C F G C F F F F F F FD K G C F U K G VC FE C GF LC F F C G FU FTAQA C LG North F FC G G C FU G C F FG A UC F UFD 3DFSiesmic G FF F FC F F FG A F G FC U FC F U CU G G G F F F K C G A G F C G G D C G G F K F G A F F F G G I M T44 T44 F C F F F F U G F G GG G F C F V F F G A GF F A U G G F F G EF F G KE F F F C F G FU C F K F C F G F A E FC F GU FC K G F F C F F 90% FC F FC G EU F F FC F U F U K FU A E G F I F G FUC G KC F G E K E F DUF G F U G G C U A F F K FU F F G F FF G L E J D GG KUFU F E F U G UE E G C G FC A E G LU F U F G FC6 L JJ FLC G J 1 EU6 I S E 1G F IE G FUFC F 1 G 6 G F F FC 1G 6 FE G F G F F FC FC A F G GJ UF G FCG G FC E S E SUI D IU U E F F US FE36 E 31FE FU F F 31FF EE31I ICE EI G FLC FC S G 36 FC 36 31 F U GU F FV GE I C DU G C FG G C36 GK K F F UC JK K F F F G FD C FU G C CLC FF GF U G S E SJ SECEFII S G E E C U U S F G F C G F C SC C E GG JE G VE F UU C G CU GU FC FL F G G E SUE S EE G F E F L F I FL V L CU FF F G F E S IE E S GS JI E EE D S C F E E U G I F K G F FC FL G G JC JI FF F GGV E F C E F U E S E S EJFEI S G F G VF F EF E F GU E E EJE S JU I FC FC F F I F G I S ES E ESESG T43 T43 E U FCF E E G C F M F I G E AFI F E F F C FG U F FL F G I FCS ES EEES S E U KG G E E EEU JG U F GUC K KF F G U G FE S SAE FDJF D I FE E F U JIC G S I EFS G E G G U G GU S FDD D FU F G F F F C F G FE E E E G FIF F S E EFC FCU EC E UI EESE E G E F U JEU F G G F C F E S J G F J K F F E EI EG E EEC M E G EEEESE E DS E GGE I F E C F A F G FU U GU UE F C F1 FC6 FU KU ES SIUEE EF J FJS E1E F 6 C F 6D I 1 G 1 G6 A F I C E J J F F G G F E E E E ECE E IF IE G S G LL CU E G I FE S EA D E F G F31 G I UE E 31 FE E I FI FE I E E36E 31 G36 G 36 U G LD F FC GU36LFC F 31 G EG E U D S G I F F CE FC FC C E E E S E JM G D F U U E E ESE E EEE D E FSGJE JG F K GG UD G F G ES W G F J A G I I G G C U E M D S FC G FS E F FC F C E G E EG G F JG G J F E S EFI G FJE I E G CG G FJU GU E E E G U G CU E S SG E I C F G E S E S E SJSFE JEI S F F UFIG E E EC IUE S F F F C F G F EG F G E E C F EGI CE I GC G F U F FU FF F C C CE FL UF S E E E VFS I G T42 T42 E S E U F FD G F ES GE F G L K FL EC FC G GG F E LEE E EUEGE C F F G F F F FD EG UEJ E E FC FC FG G G C FC F GU U E FEUS E E SJG F U I FC G I D EG F F F F EEG FL GV G UF FF F IE SI S FM G G GG G F G F G E GU U FF E E F U S G I E F F F U U F U F F F F UE EFL C S E FS E C EEFS F F FE F G EE U6G F G E EU SF E CA SFC FE G F G1 1 6 1K U 6 1 6 G F CG F F EU CF EIEE CFU F E U FCG F LC F F SEF G E GG E G E EE E UES KU F UG C C E E E A K FFC EE F U U IG FG E G F F U J EU G G G U EFU J K 31 L S E S EEG S F 36F F 31 36 FC F 36 31 36 F 31G G U FG F G E FU Conifer Land EG FUG E EFE FE FFC G FJ FEEM FE FF G K FG EF SF E J S I J J F F FC FU F E ES EE C F G G F Shallow GCUC/ Medium F EV L G Rights G FC F E FE U S GG EF SG JFSS J FG G G E G D G FC J L F FC FC FDJ J SFU F S FEESSF G F EG F GG E EE E G E C WI)FEU KE U J J G F Deep Rights CU F G G G UG FG S EESFG JFEM F F C(90% G F JC F L LCFU FC U E D D JEU S J F SG GF FU F G G U G F F G FC FU T41 C G T41 F FI J J S EEDrilling FU FU CU G Location F F FUU SF E SF GE S U F F G F F FS E G FJ S J S JE D F G FF C G G C FC U F G SFDLFF FC F F F A UC FC F FC F G F FG GUF F U F EI LC G F G G F FC G FD G U EF EJ EFJG SFJ E F GS F F G F E S G F GG GV G FC FF FC F F F E G FLCFL E SG U FC F F F F G EFE G C FC FU F F FEF E UU F L F FJG E JF F FE U G G K F FC F U D C G G D F F S S E FE E VE U JF G F F C6 F EFV FE S GJ EL G F F F F F1 FU6 F F FC6F G 1 1 EE 6J 1 U I FF FC G G F L FC F
Taqa 3D
T44
A
Banff "A" 30 Bcf
9-15 Banff Location
T44
Banff "E" 6 Bcf
Banff "B" 5 Bcf Banff "A" 20 Bcf
T43
Banff "C" 18 Bcf
T43
T42
T42
Banff "B" 56 Bcf
Banff "C" 13 Bcf
T41
T41
A
R11
R11
R10 R10
R9 R9
R8 R8
R7W5 R7W5
1.0E-4 1.0E5
1.0E4
♦
1.0E-5 1.0E4
1000
♦
10 m m cf/d
1.0E-6 1000
100
♦
R11
High impact liquids rich Middle Banff gas (90% W.I.) Production from dolomitized grainstones within marine canyon cuts Analogous pools offsetting clearly identified on 3D Strong 9-15 Banff seismic character anomaly mapped on 3D RGIP of 6-20+ Bcf on similar Banff 3D anomalies Initial production rates between 5-20 MMcf/d Well depth of 2,700 meters Costs: drilling and casing - ~$1,650,000, completion $500,000, equip & tie-in - ~$1,600,000 Tie-in to TAQA 4-3-44-10W5 TAQA as farmor retains proprietary 3D
1.0E-7 100
10
♦
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Time Avg Dly Wtr (bbl/d)
Avg Dly Gas (mcf/d) GOR (scf/bbl) Cum Oil/Cnd (bbl): Cum Gas (mcf): Cum Wtr (bbl):
Created in AccuMap (TM), a product of IHS Datum: NAD27
2328 22114131 167505 Licence Data to: February 18, 2009 / Production Data to: December 31, 2008
11 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
North Central — Kaybob East Exploration Prospect Summary Highlights ♦
High quality 27 API middle Jurassic oil (100% W.I.) Well 9-14-65-18W5 produced 10 Mbbls of oil from 8.5 meters of net pay with average porosity of 14% Significant upside exists on Conifer land offsetting 914 which was severely damaged by multiple compleT66 tion operations Analogue Jurassic A and B pools in Twp 65 Rge 1516W5 Drill depth of 1,750 meters T65 Costs: drilling - $600,000, casing - $200,000, completion - $450,000 Initial production of 40 bbls/d of oil with P50% T64 reserves of 65 Mbbls per vertical well Full scale development, including horizontal drilling Potential water flood candidate Secondary Notikewin updip of prolific Kaybob Notikewin A and B pools
♦ ♦
♦ ♦ ♦ ♦ ♦ ♦ ♦
Curr Licensee: PETRO-CANADA Orig Licensee: PETRO-CANADA Status: Oil,Abd Zone Prod Zone(s): RCKK
Unit Code: Pool Code: Field: On Prod:
PCI KAYBOB 9-14-65-18 00/09-14-065-18W5/0 March 11, 2009
R18
R17
R16
R15W5
T66
T65
T64
R18
R17
R16
R15W5
N/A 432001 KAYBOB March 1, 1991
1.0E4 1000 1.0E4
1.0E4 1.0E4 1000
1000 100 1000
1000 1000 100
100 10 100
100 100 10 1 1 0.1
1 0.1 1
10 1 10
10 10 1
1991
1992
1993
1994
Time Cal Dly Wtr (bbl/d) Cal Dly Fluid (bbl/d) WCT (%)
Created in AccuMap (TM), a product of IHS Datum: NAD27
Cum Oil/Cnd (bbl): Cum Gas (mcf): Cum Wtr (bbl):
10738 9214 404
Cal Dly Gas (mcf/d) GOR (scf/bbl) Cal Dly Oil (bbl/d)
Licence Data to: February 18, 2009 / Production Data to: December 31, 2008
12 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
North Central — Calais Exploration Prospect Summary Highlights ♦
High quality 39 API long life Upper Montney oil Analogue Triassic F pool produces to the south Key well: 9-10-70-25W5 has produced 6 Mbbls of oil and 125 MMcf of gas to date Play concept extends Montney C pool (9-10) onto Conifer & crown lands Conifer drilled well 2-11 and encountered an interpreted oil / water contact Initial production of 50 bbls/d oil P50% reserves of 115 Mbbls of oil from vertical wells 3D seismic utilized for predicting structure adjacent to reef rim Drill depth of 1,800 meters Costs: drilling - $660,000, casing - $170,000, completion - $400,000 Full scale development may include horizontal drilling
♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦
R25
R24W5
T70
T70
Curr Licensee: NAL RESOURCES Orig Licensee: NAL RESOURCES Status: Oil,Pump Prod Zone(s): MNTN
Unit Code: Pool Code: Field: On Prod:
N/A 500006 STURGEON LK S March 1, 1996
T69
1000 1000 100
1000 100 1000
1.0E4 1.0E4 1000
1.0E4 1000 1.0E4
NAL CRESTAR STURLS 14-13-69-25 00/14-13-069-25W5/0 March 11, 2009
100 100 10
100 10 100
T69
1 1 0.1
1 0.1 1
10 10 1
10 1 10
100 bbls/d
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Time
R25
R24W5
Cal Dly Wtr (bbl/d) Cal Dly Fluid (bbl/d) WCT (%)
Created in AccuMap (TM), a product of IHS Datum: NAD27
Cum Oil/Cnd (bbl): Cum Gas (mcf): Cum Wtr (bbl):
184197 432392 53932
Cal Dly Gas (mcf/d) GOR (scf/bbl) Cal Dly Oil (bbl/d)
Licence Data to: February 18, 2009 / Production Data to: December 31, 2008
13 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
North Central — Teepee Exploration Prospect Summary Highlights ♦ ♦ ♦ ♦
♦ ♦ ♦ ♦ ♦
One well (15-12-73-3W6) with cumulative production to date of 150 MMcf Proven Dunvegan channel production trend Working interest of 60% The well has penetrated a highly permeable channel sand (10 meters), which extends N.W. to S.E. towards crown land on the west side of the Smoky River 3D seismic identifies Dunvegan amplitude anomalies at 4-7-73-2W6 location Formation depth of 700 meters Costs: drilling - $340,000, casing - $80,000, completion $100,000, Tie-in - $315,000 Initial production of 450 Mcf/d, P50% reserves of 300 MMcf Future activity of the Dunvegan trend to the Northwest and Southeast
R3 32
29
33
LC
36
27
26
25
32
33
34
35
30
29
28
27
26
19
20
21
22
23
18
17
16
15
14
7
8
9
10
11
31
28
L U G
Dnvg
G L
20
21
G
22
23
15
14
T73 T73
G
G
17
G
16
13
F
F G
G
G
24
L
C
T73
R2W6
R2W6
35
G
G M U
T73
R3
34
15-12-73-3W6
CF
U F
UF
C U
8
9
16-11-73-3W6
10
11
G
12
A
K
4-7-73-2W6
GG
C 5
4
3
2
G
G
1
6
5
4
3
2
36
31
32
33
34
35
25
30
G
FL G 32
33
34
35
U G
29
E
T72
28
27
20
26
D
J
E E
S
IC E21
28
27
U C
23
24
19
14
13
18
G
20
All Rights (60%) 21
22
26
T72 T72
C23
J
E E
E
Drilling Location
A
E I
16
ConiferG Land
Shallow Rights (60%)
JS 22
E
G 17
29
G
S
T72
H
15
E D
3-D Seismic 17
16
15
14
E U
R3
R2W6
R3
R2W6
16-11
15-12
4-7-73-2W6
DUNVEGAN AMPLITUDE Proxy for Net Pay
14 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Sale Process & Contacts Conifer Exploration Ltd. (“Conifer” or the “Company”) has retained Peters & Co. Limited (“Peters & Co.”) as its exclusive financial advisor to coordinate all aspects of this value maximization process and Peters & Co. will act as the sole contact for all parties who have expressed an interest in acquiring Conifer (“Interested Parties”). An online virtual data room has been established, as well as a physical data room in the offices of Conifer at 900, 521 - 3rd Avenue S.W., Calgary, Alberta. These data rooms provide a comprehensive technical description of Conifer’s core properties and exploration prospects, as well as detailed corporate, operational and financial information. To gain access to the data room, qualified Interested Parties must execute a confidentiality agreement and return it to one of the representatives listed below. Initial physical data room appointments will generally be a half day in length. Subsequent data room appointments will be scheduled on an “as-needed” basis. Conifer’s management will provide a corporate overview presentation, as well as technically-oriented property presentations, to all data room participants. Subsequent meetings with Conifer’s management may be scheduled through Peters & Co. The virtual data room can be accessed at any time. Conifer and Peters & Co. expressly reserve the right at any time to amend or terminate these sale procedures, to decline to permit an Interested Party to participate in the process, to terminate discussions with any or all Interested Parties, to reject any or all offers, or to negotiate with any party with respect to a possible transaction. The physical and online data rooms will be open the week of March 23, 2009. Management presentations will be available beginning the week of March 30, 2009. Non-binding transaction proposals will be due in early May, 2009.
Contacts Peters & Co. will act as the sole contact for all Interested Parties. The directors, officers and employees of Conifer should not be contacted directly. All communications and inquiries from Interested Parties should be directed to one of the representatives listed below: Peters & Co. Limited 3900 Bankers Hall West 888 Third Street S.W. Calgary, Alberta T2P 5C5 Facsimile: (403) 261-7570 www.petersco.com J.G. (Jeff) Lawson, Principal (403) 261-2298
[email protected] Michael R. Hayward, Associate (403) 261-2254
[email protected] Ian D. Bruce, C.E.O. (403) 261-2278
[email protected] Chad J. Royer, Analyst (403) 261-2228
[email protected] Dustin J. Besaw, Analyst (403) 261-2272
[email protected] 15 PETERS & CO. LIMITED
Conifer Exploration Ltd. March 2009
Disclaimer This Information Memorandum is based on information provided by Conifer from its own records and from other sources. The Information Memorandum is being distributed, on behalf of Conifer, by Peters & Co., the Company’s exclusive financial advisor, solely for the use by certain qualified Interested Parties. The sole purpose of the Information Memorandum is to assist Interested Parties in determining whether or not to proceed with further investigation of the potential purchase of the Company or a substantial equity investment by a private investment group (“Transaction”). The information contained herein (the “Information”) has been prepared in good faith to assist Interested Parties in completing their own independent evaluation of the Company, but does not purport to be all inclusive or to contain all of the information that an Interested Party may desire or that may be required by an Interested Party to properly evaluate the business, prospects or value of the Company. In all cases, the Interested Parties should conduct their own independent investigation and analysis of the Company and the data set forth in this Information Memorandum. Peters & Co. has not independently verified any of the Information contained herein. Neither Peters & Co., the Company nor their respective affiliates make any representation or warranty (expressed or implied) as to the accuracy or completeness of this Information Memorandum. Neither Peters & Co., the Company nor their respective affiliates will assume any liability for the Interested Parties’ use of this Information Memorandum or any other oral, written or other communication transmitted to the Interested Party during the course of its evaluation of the Company. Conifer and Peters & Co. expressly disclaim any and all liability and responsibility for and associated with the quality, accuracy, completeness or materiality of the Information. The Interested Party will conduct its own independent evaluation and analysis of the Information and satisfy itself as to the quality, accuracy, completeness and materiality of the same. The Interested Party will rely solely on its own independent evaluation and analysis of the Information when deciding whether or not to submit a bid, enter into a definitive purchase agreement and consummate a Transaction. This Information Memorandum may include certain statements, estimates, forecasts and projections provided by and with respect to the anticipated future performance of the Company. Such statements, estimates, forecasts and projections reflect various assumptions made by the Company and/or Peters & Co. concerning anticipated results, which may or may not prove to be correct. No representations or warranties are made as to the accuracy of such statements, estimates, forecasts or projections. The only Information that will have any legal effect will be that specifically represented or warranted in a definitive purchase agreement, when, as and if executed, with respect to a possible Transaction and executed on behalf of the Company and the purchaser or investor. NEITHER THIS INFORMATION MEMORANDUM NOR ITS DELIVERY TO AN INTERESTED PARTY SHALL CONSTITUTE OR BE CONSTRUED TO BE AN OFFER TO SELL ANY SECURITIES OF THE COMPANY. THIS INFORMATION MEMORANDUM SHALL NOT BE DEEMED AN INDICATION OF THE STATE OF AFFAIRS OF THE COMPANY NOR CONSTITUTE ANY INDICATION THAT THERE HAS BEEN NO CHANGE IN THE BUSINESS OR AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
16 PETERS & CO. LIMITED