Obsidian Energy Corporate Presentation · PDF fileCorporate Presentation January 2018. ... This presentation should be read in conjunction with the Company's audited consolidated ...

Obsidian EnergyCorporate Presentation

January 2018

ObsidianEnergy.com | TSX/NYSE: OBE

Important Notices to the ReadersThis presentation should be read in conjunction with the Company's audited consolidated financial statements, management's discussion and analysis ("MD&A") for the three and nine months ended September 30, 2017. All dollar amounts contained in this presentation are expressed in millions of Canadian dollars unless otherwise indicated.

Certain financial measures included in this presentation do not have a standardized meaning prescribed by International Financial Reporting Standards (IFRS) and therefore are considered non-generally accepted accounting practice ("non-GAAP") measures; accordingly, they may not be comparable to similar measures provided by other issuers. This presentation also contains oil and gas disclosures, various industry terms, and forward-looking statements, including various assumptions on which such forward-looking statements are based and related risk factors. Please see the Company's disclosures located in the Appendix at the end of this presentation for further details regarding these matters.

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ObsidianEnergy.com | TSX/NYSE: OBE

Obsidian Energy Corporate Profile

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Production boe/d 30,166

% Liquids % 62%

Operating Costs $/boe $12.26

Netback $/boe $18.70

2017 Capital Budget $MM $160

Share PriceDec. 31st, 2017

$/share $1.56

OBE-TSX Daily Volume% of shares outstanding

MM 0.90.2%

OBE -NYSE Daily Volume% of shares outstanding

MM 1.00.2%

Market Capitalization $MM $787

Net Debt $MM $410

Enterprise Value $MM $1,197

Corporate Metrics

Q3 2017 Operating Metrics

AlbertaViking1,766 boe/d

Net Sections: 170

Cardium18,876 boe/dNet Sections: 450

Index Map

Peace River

4,823 boe/dNet Sections: 235

Deep BasinNew Wells on Q4 2017

Net Sections: 700

Legacy Asset Production of 4,701 boe/d Operating cost are net of carry and netbacks include hedging

See end notes

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A Balanced Portfolio with Significant Optionality

LOW DECLINE BASE PRODUCTION &

STABLE CASH FLOW

BALANCED SHORT & INTERMEDIATE CYCLE

DEVELOPMENT

LIQUIDS WEIGHTED, SUSTAINABLE

GROWTH

Cardium

Meaningful Free Cash Flow Generation

Waterflood Approach with Primary Optionality

Peace River

Manufactured Cold Flow, High Rate & Low Cost

Multiple Egress Options

Alberta Viking

Short Cycle Investment to Toggle Growth

Industry Leading Initial Production Rates

Deep Basin

Multi Horizon Potential

Focus Highly Economic Mannville Development

ObsidianEnergy.com | TSX/NYSE: OBE

On Track For High End of Guidance

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Total Capital On Track for Guidance

On Track to Meet all 2017 Guidance Metrics

Q4 A&D Adj. Production boe/d

FY 2017 Productionboe/d

TotalExpenditures$MM

Operating Expenses$/boe

20,000

23,500

27,000

30,500

34,000

Q4 2016 Q4 2017

Reiterating Double Digit

Growth

Operating Costs on track for Guidance

Total Expenditures

Guidance $160

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

Total Expenditures Guidance

Operating Cost Guidance

$13.00 - $13.50

$12.50

$13.00

$13.50

$14.00

Guidance*Net of Peace River Carry

Production Guidance

30,500 - 31,500

30,000

30,500

31,000

31,500

32,000

See end notes See end notes

ObsidianEnergy.com | TSX/NYSE: OBE 6

Low Decline Rate Underpins Growth

16% Corporate Base Production Decline RateCardium Asset Under Historical Waterflood

Capital Efficiencies of $6,500/boe/d on 2017 Optimization ProjectsOptimization of existing base wellbores

10,000

15,000

20,000

25,000

30,000

35,000

Q1 2018 Q2 2018 Q3 2018 Q4 2018

(bo

e/d

)

Base Production 2017 Development 2018 Development

2017 Base Production & 2017 Development Declines 16% in 2019

Corporate Base Productionboe/d

16% Base Decline Rate

22% Base + 2017 Development Decline Rate

See end notes

ObsidianEnergy.com | TSX/NYSE: OBE 7

Waterflood Performance is Impressive Cardium Decline Rate lowered from

approximately 20% to 5%

Waterflood and base optimization projects initiated in 2016

Cardium Base Production Declineboe/d

Pembina Waterflood Activity

Converted and reactivated 37 wells in PCU #9 since Q3 2016

Drilled 8 new injectors to support 2017 new drills

Actively managing more than 120 existing injectors

5 miles

10 kms

T48

R10 R9W5

T47

10,000

12,500

15,000

17,500

20,000

Jan-16 Jul-16 Jan-17 Jul-17

Base with No Waterflood SupportBase with Waterflood SupportActual Base Production with Waterflood and Optimization Support

OBE Operated Cardium unit

OBE Cardium land

Waterflood activity since Q3 2016

Actively managed inj.

2017 OBE well

Drilled 8 new injectors in 2017

Actual Decline 5%

Decline 20%

Optimized Waterflood

Decline 10%

Decline 20%

See end notes

ObsidianEnergy.com | TSX/NYSE: OBE 8

Early Cardium Rates Above Type Curve

INDEX MAP

10 miles

15 kms

WILLESDENGREEN

OBE land

OBE producing well

Industry HZ well

R10W5

T45

T40

T50

R5

3 miles

5 kms

T43

R8W5

11-03-43-8W5 CARDIUM4 well Hz pad

Expected on productionby YE 2017

WILLESDEN GREEN11-03-43-8W5 Pad PCU #9 Program is

>100 boe/d above type curve

Crimson (Willesden Green) wells on production by year end T48

3 miles

5 kms T47

R10W5

PEMBINA

100/15-02-48-9W5On Production: 10/8/2017

Initial Stabilized Rate: 195 boe/d

102/13-02-48-9W5On Production: 10/8/2017

Initial Stabilized Rate: 140 boe/d

103/14-02-48-9W5On Production: 10/8/2017

Initial Stabilized Rate: 205 boe/d

PCU#9 6-35-48-9W5 Pad

ObsidianEnergy.com | TSX/NYSE: OBE

100/04-18-32-1W4On Production: 10/11/2017

IP30: 188 boe/dPercent Liquids: 76%

100/14-06-33-2W4On Production: 9/15/2017

IP30: 118 boe/dPercent Liquids: 39%

100/03-18-32-1W4On Production: 10/13/2017

IP30: 212 boe/dPercent Liquids: 76%

Compeer GP

Esther GP

Misty GP

Monitor West GP

102/02-18-32-1W4On Production: 9/5/2017

IP30: 218 boe/dPercent Liquids: 57%

INDEX MAP

10 miles

15 kms

OBE gas plant

OBE land

R5 R1W4R10

T35

T30

102/03-18-32-1W4On Production: 10/3/2017

IP30: 237 boe/dPercent Liquids: 73%

T25102/04-18-32-1W4

On Production: 10/7/2017IP30: 179 boe/d

Percent Liquids: 66%

100/02-18-32-1W4On Production: 8/28/2017

IP30: 295 boe/dPercent Liquids: 50%

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AB Viking Program Continues to Exceed Expectations

102/01-30-32-2W4On Production: 8/30/2017

IP30: 248 boe/dPercent Liquids: 29%

103/02-23-32-2W4On Production: 9/27/2017

IP30: 296 boe/dPercent Liquids: 46%

Continuing to evolve development strategy to enhance economics and maximize capital efficiency

102/02-23-32-2W4On Production: 9/26/2017

IP30: 227 boe/dPercent Liquids: 46%

ObsidianEnergy.com | TSX/NYSE: OBE

Obsidian Energy 55% OwnershipIn the Peace River Oil Partnership

HarmonValley

HarmonValleySouth Seal

100/15-34-83-18W5On Production: 10/9/2017

IP25: 47 bopdDrill Cost: $74/m

INDEX MAP

10 miles

15 kms

R20W5

T80

R15

T85

OBE land

Acquired land in 2017

PROP

104/16-36-82-18W5On Production: 10/14/2017

IP22: 236 bopdDrill Cost: $79/m

1-5-83-17W5 Surface 2 Wells

TD Wells: 11/7/2017

100/10-36-82-18W5On Production: 10/29/2017

First Oil: 11/6/2017Drill Cost: $84/m

100/04-36-82-18W5On Production: 10/3/2017

Last 30 Days: 215 bopdDrill Cost: $120/m

102/15-26-82-18W5On Production: 9/20/2017Last 30 Days: 302 bopd

Drill Cost: $107/m

102/08-25-82-18W5On Production: 8/12/2017Last 30 Days: 216 bopd

Drill Cost: $120/m

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PROP Program Returned to the Heart of Harmon Valley South Economics still

attractive post carry

Well costs dropped 17% in H2 versus H1 due to optimized well length and cheaper cost per meter

100/15-34-82-18W5On Production: 8/31/2017

IP30: 288 bopdDrill Cost: $65/m

103/14-34-83-18W5On Production: 9/20/2017

IP30: 201 bopdDrill Cost: $69/m

102/14-34-83-18W5On Production: 9/21/2017

IP29: 79 bopdDrill Cost: $62/m

100/02-27-82-18W5On Production: 8/31/2017

IP30: 78 bopdDrill Cost: $51/m

See end notes

ObsidianEnergy.com | TSX/NYSE: OBE 11

INDEX MAP

5 miles

10 kms

OBE land

OBE operated Cardium unit

R8W5

T44

T41

WILLESDENGREEN

100/02-07-043-07W5 MNVLOn Production: 10/12/2017

Initial Rate: 3.4 MMCFD, 38 bbl/mmcf free condensate

24 bbl/mmcf other liquidsCurrently choked for liquids

100/14-30-043-07W5 MNVLOn Production: 8/30/2017

Initial Rate: 3.2 MMCFD, 8 bbl/mmcf free condensate

31 bbl/mmcf other liquids

Deep Basin Results are Liquids Rich

Obsidian Energy 80% Working Interest

Foray into Deep Basin executed on schedule and on budget

Tested different upper Mannville tar