Corporate Presentation TSX.V AUGUST 2014
TSXV.CAC
Consolidating Micro Caps, Exploiting Quality Assets
Certain statements contained in this Presentation constitute forward-looking statements or information (collectively "forward-looking statements") within the meaning of applicable securities legislation. All statements otherthan statements of historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "seek", "anticipate", “opinion", "continue", "estimate", "expect","may", "will", "project", "predict", "potential", "targeting", "intend", "could", "might", "should", "believe", “plans” and similar expressions. These statements involve known and unknown risks, uncertainties and other factorsfacing the Corporation. Risks, uncertainties and other factors may be beyond the Corporation's control and may cause actual results or events to differ materially from those anticipated in such forward-looking statements.Canamax believes that the expectations reflected in these forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statementsincluded in this Presentation should not be unduly relied upon by investors. These statements speak only as at the date of this Presentation and are expressly qualified, in their entirety, by this cautionary statement. Inparticular, this Presentation contains forward-looking statements pertaining to the following: future plans and operations; reserve estimates; expectations of initial and future production; cash flow; capital expenditures;production targets; drilling inventory; netbacks; development potential; production acquisition costs; and acquisitions.
With respect to forward-looking statements contained in this Presentation, Canamax has made assumptions regarding, among other things, results of future operations, the legislative and regulatory environments of thejurisdictions where Canamax carries on business or has operations, the impact of increasing competition and Canamax’s ability to obtain additional financing on satisfactory terms. Canamax’s actual results could differmaterially from those anticipated in these forward-looking statements as a result of the risk factors included in this Presentation such as: the impact of general economic conditions; industry conditions; volatility in the marketprices for natural gas and crude oil; currency fluctuations; uncertainties associated with estimating reserves; geological, technical, drilling and processing problems; liabilities and risks, including environmental liabilities andrisks inherent in natural gas and crude oil operations; stock market volatility; the ability to access sufficient capital; incorrect assessments of the value of acquisitions; and, competition for, among other things, capital,acquisition of reserves, undeveloped lands, equipment, services and skilled personnel.
This forward-looking information represents Canamax’s views as at the date of this Presentation and such information should not be relied upon as representing its views as of any date subsequent to the date of thisPresentation. Canamax has attempted to identify important factors that could cause actual results, performance or achievements to vary from those current expectations or estimates expressed or implied by the forward-looking information. However, there may be other factors that cause results, performance or achievements not to be as expected or estimated and that could cause actual results, performance or achievements to differmaterially from current expectations. There can be no assurance that forward-looking information will prove to be accurate, as results and future events could differ materially from those expected or estimated in suchstatements. Accordingly, readers should not place undue reliance on forward-looking information.
The forward-looking statements contained in this Presentation speak only as of the date of this Presentation. Canamax does not undertake any obligation to publicly update or revise any forward-looking statements, whetheras a result of new information, future events or otherwise, unless required by applicable securities laws.
Undue reliance should not be placed on management's assessment of reserve estimates, resource potential drilling locations and initial and potential production rates. All references to such information contained herein arebased upon internal targets as prepared by management of Canamax and are not an estimate of reserves, resources or of production rates that may actually be achieved. Such information has been provided to assist thereader in understanding certain principal factors upon which management has relied in making capital investment decisions and for internal budget preparation. Reserve potential information provided in this Presentationincludes both discovered and undiscovered resources and recoverable reserve characteristics, and there is no certainty that any portion of the undiscovered resources will be discovered and, if discovered, that any volumeswould be economically viable or technically feasible to recover or produce. Undue reliance should not be placed on estimates of reserve potential in terms of assuming Canamax's reserves or recoverable resources. Allestimates of reserve potential contained herein are based upon internal estimates of management of Canamax.
This Presentation contains references to Original Oil in Place ("OOIP") which is equivalent to estimates of oil and gas classified as Discovered Petroleum initially in Place ("DPIP") which are not, and should not be confused withoil and gas reserves. "Discovered Petroleum Initially in Place" is defined in the Canadian Oil and Gas Evaluation Handbook (the "COGE Handbook") as the quantity of hydrocarbons that are estimated, as of a given date, to becontained in known accumulations. DPIP is divided into recoverable and unrecoverable portions, with the estimated future recoverable portion classified as reserves and Contingent Resources, as defined in the COGEHandbook. There is no certainty that it will be economically viable or technically feasible to produce any portion of the DPIP except to the extent identified as proved or probable reserves. Resources do not constitute, andshould not be confused with, reserves. It should be noted that given the current early stage of development of Canamax's properties, estimates of DPIP potential might change significantly in the future with furtherdevelopment activity and the amount of Contingent Resources has yet to be estimated. The resource potential estimates provided herein are estimates only and the actual resources may be greater than or less than theestimates provided herein. A recovery project cannot be defined for these volumes of DPIP at this time. There is no certainty that it will be economically viable or technically feasible to produce any portion of these potentialresources.
The information contained in this Presentation does not purport to be all-inclusive or to contain all information that a prospective investor may require. Prospective investors are encouraged to conduct their own analysis andreviews of Canamax and of the information contained in this Presentation and the public record. Without limitation, prospective investors should consider the advice of their financial, legal, accounting, tax and other advisorsand such other factors they consider appropriate in investigating and analyzing Canamax. Additional information relating to Canamax is available on the Canadian System for Electronic Document and Analysis and Retrieval(“SEDAR”) at www.sedar.com
Any financial outlook or future-oriented financial information, as defined by applicable securities legislation, has been approved by management of Canamax. Such financial outlook or future-oriented financial information isprovided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that reliance on such information may not be appropriate for otherpurposes.
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Reader Advisory and Cautionary Statements
•Corporate and property acquisitions at accretive financial metrics
•Exploit low risk development opportunities
•Top tier technical and financial competence
The Opportunity
•Completed 4 accretive deals and 1 farm-in in last 11 months
• July exit production – 1200 boe/d (61% Oil & NGL’s)
•Closed 3 financings - $20mm gross proceeds since Sept 2013
•Strong balance sheet – No debt
Continuous Execution
•Focus on consolidation in core areas
•Targeting 2,000-3,000 boe/d in 12-24 months
•Combination of acquisition and exploitation
•Multi-year inventory of low risk drilling locations
Visible Growth
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Growing shareholder value
Fall 2013
• Brazeau River – Acquired 100% working interest in 2.25 sections – no up front investment, Recompleted 2 wells in Cardium and commingled 1 well
• Flood - Expand Energy acquisition for net $0.7mm, Large Montney Oil play 100% working interest, 37 sections, 3D Seismic, drilled water disposal well and upgraded battery for injection
• Wapiti - Completed farm-in - drilled horizontal Cardium well for gross $3.5mm – Stabilized current gross production rate of 115 boe/d
Q1 - 2014
• Acquisition of Ki Exploration for $6.2mm (3.0mm shares and assumed net debt)
• 330 boe/d production and 2P reserves of $16.6mm
• Metrics - $19,000 boe/d or 3.0x trailing cashflow
• Completed financing for $13.0mm to fund Ki acquisition and Capex
• Purchased additional Flood assets – 5.0 additional net sections, 50 boe/d and gas pipeline with sales point and compressor – cost of $1.1mm
Q2-Q3
2014
• Announced capital budget for remainder of 2014
• Develop Flood (8 wells, recomplete 3 wells & infrastructure)
• Drill 1 well (0.7 net) at Wapiti and recomplete 4 wells in Retlaw/Brazeau River
• Rounded out management and operations team capable for expansion to 3000 - 5000 boe/d
• Commenced drilling and recompletion program with better than expected results
4
Acquisition & Exploration to date
Targeted calendar 2014 exit production rate of 1,500-1,600 boe/d (65% Oil & NGL’s)
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Corporate Snapshot
Stock Exchange TSX.V – Symbol CAC
Current share price – at August 7, 2014 $1.57
Capital StructureCommon stock (basic)
(fully diluted)(Insider ownership – fully diluted)
Market Capitalization - BasicCash and working capital – May 31, 2014 Enterprise value – BasicBank lines
41.3mm57.6mm
15%$64.8mm$6.7mm
$58.1mm$6.0mm
(1) Lower netback due to one time maintanence costs on newly acquired Ki Exploration wells
Production and ReservesProduction – (as at July 25, 2014)
Oil & NGL’s %1P Value (as at Feb 28, 2014)
2P Value (as at Feb 28, 2014)
Undeveloped land (Net acres)Field Net Back (quarter ended May 31, 2014) (1)
1200 boe/d61%
$34mm$55mm53,000
$26/boe
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Experienced Management and Board
MANAGEMENT
Brad Gabel – President & CEO and Director• Involved in numerous acquisitions and divestitures (private and
public companies) - $360mm
• President of Pure Energy Services (TSX Listed sold for $280m),
• Founder & CEO of Canadian Sub-Surface (was TSX listed)
Jeremy Krukowski, P.Eng – Chief Operating Officer• VP Operations for Rimfire Energy Inc. start-up to 600 boe/d,
Manager of Operations at Onyx (2006) Inc. – start-up to 600 boe/d, Manager of Operations at Onyx O&G Ltd. – start-up to 1,600 boe/d
Chris Martin, C.A. – VP Finance and CFO• VP Finance and CFO of Pure Energy Services, Canadian Sub-
Surface Energy Services, Jet Energy and Calvalley Petroleum
• Involved in numerous acquisitions and divestitures
Karen Genoway – Landman• VP Land at Onyx O&G Ltd. and Rimfire Energy Inc., VP Land at
Enerplus Corp.
Nabil Khouri, P. Geol – Geologist • Over 45 years experience in WCSB. Worked with Pan Canadian,
Amerada Hess, Onyx, Ascot and Rimfire
BOARD OF DIRECTORS
Kevin Adair – Executive Chairman
Hugh Ross – Director
Mark Shilling – Director
Stuart McDowall – Director
Allan King – Director
Kevin Delaney - Director
OPERATIONAL & EXECUTIVE TEAM
Ian Buchanan – Internal legal counsel and corporate secretary
Jeremy Yee – Land Manager
Jeff Lane, P.Eng – Operations & Production Manager
Bonnie Lamming CA - Controller
Gary Sveinson – Production manager
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Canamax Core Areas
Alberta
Edmonton
Calgary
Grand Prairie
FLOOD
WAPITI
BRAZEAU RIVER
RETLAW
Brazeau River (100%)• Cardium and Belly river light oil• 4 producing vertical wells• Multi-zone development (2 sections)
NORTH WEST ALBERTA
WEST CENTRAL ALBERTA
SOUTHERN ALBERTA
Retlaw (Approx 75% WI)• Mannville medium gravity oil & shallow cretacious gas; 32 net
sections; good seismic coverage• Increased production from 170 boe/d to net 300 boe/d since
April 30, 2014 acquisition with minimal capital
Flood (100% WI)• Montney Oil; large land position (42 sections); • 28.5km 3D seismic, • 7,500 bbl battery, gas sales line; water disposal facilities• Large vertical well development property• 11 producing vertical wells
Wapiti (70% WI)• Cardium light oil• Farm-in earning well drilled• Horizontal well development property
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Flood – Large OOIP Montney oil development play
July 25, 2014 production 350 boe/d (85% liquids)
Total of 42 net sections with 28.5km2 of 3D seismic
7,500 Bbl/d oil battery, gas sales line and water disposal
Development potential continues to increase based on recent success
Low decline rates, Water floodable, vertical wells
Drill, complete and tie-in cost of less than $1.0mm
Similar economics to Saskatchewan “Viking oil play”
Acreage is on trend with Worsley, Dixonville
and GrimshawMontney oil fields
Major activity in the area with the majority
of the discoveries in mid-2000’s
3D Seismic Coverage
Oil Battery Injector WellLEGEND
Canamax 100% Lands
Recent Asset Purchase
Montney Production
Canamax Well
Montney Oil Offsetting ProductionPool Montney A Montney C Triassic D Montney F TBD
Operator CNRL Spyglass Storm Petrus Canamax
Founder Blue Mt Trigger Belamont Devon Expand
Strike Area Worseley Dixonville Grimshaw Tangent Flood
Discovered 2004 2004 2007 2006 2011
Producers 37 111 11 22 8
Injectors 9 81 1 0 1
Production (bbl/d) 576 2,687 241 215 150
Cumulative Oil (bbl) 1,751,657 8,305,576 460,155 936,457 186,000
Worlsey
Dixonville
Grimshaw
Information as of March 2014 (Accumap)
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Flood - Comparison to Viking play
Company Raging River Whitecap Beaumont Canamax
Asset Dodsland Lucky Hills Kerrobert Flood
Assumptions
Well Cost ($MM) $0.90 $0.93 $0.90 $0.85
IP 30 (boe/d) 60 120 85 50
Liquids (%) 95% 80% 96% 90%
Yr1 Decline (%) 60% 80% 80% 50%
Yr2 Decline (%) 10% 20% 8% 10%
Yr3 Decline (%) 5% 5% 3% 6%
Yr4 Decline (%) 5% 5% 3% 6%
EUR (mboe) 49.5 80.0 56.5 96.0
Liquids Content (%) 96% 80% 98% 90%
Economics 1 2 3 4
IRR (%) 85.0% 127.4% 121.9% 74.6%
NPV(10%) ($MM) $1.2 $1.8 $1.9 $1.6
Payout (years) 1.0 0.5 0.7 1.3
F+D ($/boe) $18.18 $11.63 $15.93 $8.85
Recycle (netback/F+D) 2.8x 3.9x 4.1x 5.0x
Investment Ratio (inv./NPV10) 129% 188% 210% 193%
0
20
40
60
80
100
120
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35
RRX - Dodsland WCP - Lucky HillsBeaumont - Kerrobert CAC - Flood
Key assumptions include:
• Commodity prices have been kept flat at $90/bbl Edmonton par with at $10 quality differential and $4.00/mcf AECO
• Canamax cash flows include $17.00/boevariable opex
• EUR of 96mboe is based on primary of 60mboe and secondary of 36mboe per well
• Secondary recovery is based on waterflood of similar formations
Months on production
Dai
ly P
rod
uct
ion
(b
oe
/d)
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Flood – Potential development plan
Phase 2 - 2015• Second phase drilling
commences Q1 of 2015• Drill and complete an additional
11 vertical wells• Capex spend $9.9mm
Phase 1 - 2014 Bring on water disposal facility
and reactivate 4 wells Recomplete acquired wellbores• Drill and complete 8 vertical wells• Complete infrastructure including
pipeline to injection facility, and tie in to gas sales line
• Capex spend $10.7mm
Reserve Parameters Unit Montney Oil
OOIP (* per section) MMbls 3.7
API Degree 29.5
Recovery Factor % 10.8
Recoverable Oil * MMbls 0.4
Recoverable Gas BCF Flared
Recoverable Boe * MMBOE 0.4
Single well economics NPV10 $1.6mm
Second Phase 2015
• 11 Vertical WellsFirst Phase 2014
• 8 Vertical Wells
LEGEND
Canamax Lands
Phase 1 Location
Phase 2 Location
Work-over Well
• Pool size and future development will likely increase based on delineation and operational success
• Phase 3 development will include more locations to the southwest and may begin waterflood process
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Management internal reserve estimates @ 100% WI
Wapiti – Cardium Oil
Newly Acquired Section
New 9-21 Hz Cardium Well on Production
Ki Acquisition
Reserve Parameters Unit Wapiti
OOIP (per section) MMbls 4.7
API Degree 42.0
Recovery Factor % 8.1
Recoverable Oil MMbls 0.5
Recoverable Gas BCF 1.5
Recoverable Boe MMBOE 0.8
Single well economics NPV10 $3.2mm
LEGEND
Producing Well
Horizontal Location
• Farm-in – net interest 70% in 2.25 sections• Earning well at 9-21-67-8W6 has been drilled & completed as Cardium
oil well – on production March 25 • IP 30 rate 405 BOE/d (net 284 boe/d - 86% Oil & NGL)• Stabilized production of gross 115 boe/d
• 7 additional development locations – all horizontal wells• Gross cost to drill, complete and equip - $3.5mm• 2014 Capex budget = 1 Hz well $2.5mm net
Canamax holds 100% WI in 2.25 sections
4 Producing wells
1,320 mmcf gas production (220 boe/d)
120 bbls per day oil production
Gas compressor installed to improve efficiency and remove third party fees
Canamax owns drilling pads and pipelines
Multi-zone potential
Proven Cardium Oil
Belly River – “G” & Basal Zones
8 potential locations
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Brazeau River – multi-zone potential
Management internal reserve estimates @ 100% WI
Multi-Zone Potential Reserve Parameters Unit
Middle Belly River (G
Zone) Basal Zone Cardium
OOIP (per section) MMbls 8.1 6.1 4.5
API Degree 42.0 42.0 45.0
Recovery Factor % 3.7% 4.9% 5.3%
Recoverable Oil MMbls 0.3 0.3 0.2
Recoverable Gas BCF 0.7 0.7 1.5
Recoverable Boe MMBOE 0.5 0.5 0.4
Canamax Lands
Deethree Lands
Belly River Production
Cardium Production
Mannville Production
Belly River G
Basal Belly River
Belly River Play
Vertical Well Locations
Cardium Play Upper Mannville (Wilrich) Play
Wilrich Recomplete
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Retlaw area
Producing net 300 boe/d (40% Liquids)
75% of Production is Operated
Large land position of 51.1 Gross Sections (31.9 Net)
Good Seismic coverage on Upside lands; 56km2 of 3D and 116 km of 2D
Pipelines with access to facilities
Year round access
Glauconite channel well with additional follow-up wells pending results
Multi-zone potential
Shallow low cost targets <1200 m depth
RETLAW FOCUS AREA MAP
Many acquisitions in the area, followed up by successful drilling
Horizontal Glauconite channels being targeted with results over 200 boe/d IP30 rates in the direct area
Good divestment candidate once developed, many active suitors
Area Activity Heating Up
Re-evaluate seismic data
Low cost recompletions to test concepts
Upcoming drilling location Q3-Q4 2014
Near Term Development PlanLEGEND
Canamax Lands
Canamax Wells
2014 Capital Budget - $14.0mm
Flood $10.7mm
Wapiti $2.5mm
Brazeau $0.5mm
Retlaw $0.3mm
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2014 Capital Budget
• Recomplete 3 wells
• Drill and complete 8 wells
• Tie-in’s and infrastructure
• Drill, complete and equip 1 well (0.7 net)
• Recomplete 1 Wilrich well
• Recomplete and equip 3 wells
Estimated incremental production range for 2014 Capital Budget 850-950 boe/d (IP 90)
Resulting flowing efficiency rate between $15,000 and $16,500 per boe
Canamax may make changes to its capital expenditure budget depending on a number of factors, including drilling and and completion results, business conditions, commodity
Prices and prospective acquisitions and divestitures.
400
600
800
1000
1200
1400
1600
1800
Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14
High Case
Low Case
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Production Summary – Actual & Forecast
Estimated production additions in second half of 2014 reflect capital budget
BO
E/D
June ProductionNote: Brazeau River production was
shut in due to plant turnaround
from June 15 to July 7
Target Exit Production Target 65% Oil
& NGL’s
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Exploitation program – Low risk development
(1) Management estimates
Total Development Potential (1)
Area Description ZoneWorkingInterest
Net CapitalRequiredLow Case
Net CapitalRequired High Case
Est NetProduction
IP (365) Low Case
Est Net Production
IP (365) High Case
% ($mm) ($mm) (Boe/d) (Boe/d)
Flood40 – 150 Vertical wells Montney
100$38.0 $140.0 1,480 5,550
Brazeau 2 – Hz wells Belly River G 100 $9.0 $9.0 300 375
2 – Hz wells Basal Belly River 100 $9.0 $9.0 300 375
2 – Vertical wells Cardium 100 $3.5 $3.5 170 265
2 – Hz wells Wilrich 100 $17.0 $17.0 1,000 1,790
Wapiti 7 – HZ wells Cardium 70 $14.7 $14.7 700 1,050
Hines Creek 1 – Hz well Montney 75 $1.5 $1.5 60 100
Retlaw 1 – Recompletion Glauconite 100 $0.3 $0.3 20 40
Retlaw 2 – Vertical wells Glauconite 100 $2.0 $2.0 150 200
Retlaw 1 – HZ well Glauconite 100 $2.0 $2.0 60 160
Totals 60-170 Wells $93.5 $195.5 4,240 9,905
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Investment highlights
•Little or no competition in microcap space.
•Management, top tier technical and financial competence –demonstrated by recent optimization and recompletion programs
•Low cost, no-nonsense decision making
How we are different
•Relationships with financial institutions to access potential acquisition targets
•Additional prospects identified
Acquisition Pipeline
•Focus on consolidation of quality assets in core areas
•Maintain strong balance sheet
•Acquisition, low risk exploitation, and asset optimization
•Multi year inventory of drilling locations
Disciplined & Focused
June 2014Appendix
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Dilutive Equity Instruments