Perdure PetroleumMidland CO2 Conference December 2018
Perdure Corporate - Overview
Shidler Area
Panhandle Area
EOR with CO2
45Q – High Level Comments
Agenda
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Perdure Overview
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Perdure Petroleum was formed to acquire Chaparral Energy’s EOR assets November 17, 2017 Business Model Acquire properties where production can be maintained with
development activities funded with cash flow Long term distribution model vs typical PE
Equity Partners Long view on investments
Unique 45Q opportunities
Perdure Petroleum - Overview
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Shidler Area Assets
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Current Development Area
Current Net Production - ~3,000 Bbls/d
North Burbank is the Prized asset OOIP 820 Million
CO2 supply from Coffeyville gasifier/fertilizer (max rate ~50 MMCF/D) ~65 Mile CO2 pipeline 45Q opportunity for large CO2 source
With current CO2 supply, NBU has 20 plus years of development
South Burbank has CO2 flooding potential but NBU first
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Shidler Area
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North Burbank
2018 CO2 Patterns Added
Panhandle Area Assets
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Panhandle Area CO2 Supply
Perdure Active CO2 Flood
Perdure CO2 Pipelines
Perdure CO2 Sources
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Panhandle Area
Solid asset base with CO2 upside - ~2,500 Bbls/d Net Production
CO2 supply is currently limited - ~13,000 Mcf/d
Investigating natural CO2 source options
45Q opportunity to reconfigure small CO2 source
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EOR with CO2 has unique challenges
Investors OK with moderate IRR’s (15% - 30% unlevered) Willing to weather downturn in oil prices
— This is almost inevitable with the long term nature of CO2 flooding Have staying power with capital
— Grass root development projects early years have negative cash flow
CO2 Reliable supply Price
— Variable with oil (We are living in a very volatile oil price environment – To state the obvious)— CO2 Price Floors are a BIG issue
Need the right technical staff Expensive to learn from mistakes It has to be watched almost everyday
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EOR and Anthropogenic CO2 Sources
Need confidence in CO2 source for 10+ Years Supports very large oil field investment
Can have CO2 price advantage Upfront investment but CO2 cost long term can be lower than West TX purchases
There are not many large anthropogenic CO2 sources
But it can and is working economically
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45Q – High Level Comments
Will regulators and regulations be reasonable What sources will qualify MRV – Reasonable / Economic
Post economic oil production monitoring
45Q alone will most likely not support an EOR project without the other standard economic support Good reservoir Reasonably priced CO2 supply
Questions
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