P50 Resource Estimate 2.7 Billion Barrels

Transcription

1 NYSSA Energy Conference Kerry Sully President & CEO November 6, 2008 P50 Resource Estimate 2.7 Billion Barrels

2 CGX Energy Inc. Forward Looking Statements: This presentation contains certain forwardlooking statements. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding potential exploration results, hydrocarbons, resources and reserves, and the future plans and objectives of CGX Energy Inc. are forward-looking statements that involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from CGX's expectations are disclosed elsewhere in documents that are available to the public at 2

3 Who is CGX? Canadian listed company focused on Guyana exploration (OYL on TSX-V) Completed first solid state 2D seismic in basin in 1999 Forced off Eagle location in 2000, but drilled back-up Horseshoe Well to 13,000 feet in 30 days Thorough re-interpretation of all Guyana well, seismic and geological data Funded $10 million of Guyana legal costs to resolve maritime border with Suriname Currently shooting a 2,200 sq km 3D seismic program

4 Over the Next Year We are Well-Financed US$ 35 mm Working Capital June 2008 CGX Share $ millions 2,187 sq km 3D seismic Q4 08 $15 Interpretation H1 09 Environmental On-going $5 Well Planning On-going GeoPacific 4

5 Drilling Considerations Water depth Ultra HPHT Tier II Expandable Casing Design Gorilla Class Rig ~ 300 feet F k psi Deep well to 19,500 ft $85 mm - to 22,000 ft $90 + mm Jefferies Randall & Dewey have been retained as an advisor to market a joint venture farmout to drill a Deep Well on the Corentyne PPL Jackup Drilling Rig 5

6 A Major New Frontier In Latin America Guyana Suriname Basin

7 Oil 14% of Undiscovered Potential of Latin America 15.2 Billion Barrel Mean Undiscovered Resource Potential in Guyana Suriname Basin 7

8 Gas 8% of Undiscovered Potential of Latin America 42 TCF of Gas Mean Undiscovered Resource Potential in Guyana Suriname Basin 8

9 Proven Hydrocarbon System (but only 18 wells drilled beyond near-shore) Abary Shell 1975 In-well blow out 37 API oil in mud Tambaredjo and Calcutta have > 1.0 billion bbls OOIP 9

10 High Level of Exploration after Border Resolution Guyana CGX shooting 3D Repsol shooting 3D Exxon shooting 2D Suriname Repsol abandoned well CGX Acreage 9.5 mm Gross 7.2 mm Net WT 1 Murphy pending 3D Teikoku pending 3D Noble data review French Guiana Tullow pending drilling? 10

11 Guyana A Good Business Environment Democracy English speaking Production Sharing Petroleum Prospecting Licence Legal system based on English common law Company Act based on Canadian Business Corporations Act Strong associations with UK, USA and Canada 11

12 Currently Shooting 3D Seismic Seismic Grid Fugro R/V GeoPacific 8 streamers 6,000 m solid-state Corentyne 536 sq km Georgetown 1,651 sq km CGX share net 950 sq km $15.5 million 12

13 Reservoir Potential 3,200 m Lower Tertiary Turbidites Stratigraphic Traps Wishbone, Eagle, F1-F4 4,200 m Shelf Margin Deltas Structural Traps 5,400 m Cretaceous Basin Floor Fan Structural Traps Eagle Deep, Abary Deep 6,300 m 7,000 m Turonian Canje Source Kitchen Potoco Carbonates Structural Traps 13

14 Uphole Targets - Tertiary Turbidites Eagle & Wishbone Eagle Wishbone Area, acres 15,000 12,000 Net Pay, feet P50 Resource, MMbbls Independent Resource Assessment: Gustavson Associates 14

15 Primary Target - Cretaceous Basin Floor Fan Eagle Deep (West & East) Eagle Deep West Eagle Deep East Area, acres 3,600 4,200 Net Pay, feet 1,570 1,570 P50 Resource, MMbbls Independent Resource Assessment: Gustavson Associates 15

16 2.7 Billion Barrel P50 Resource Estimate For Four Prospects on Corentyne PPL Only Prospect Low Estimate P90 Prospective Oil Resource billions of barrels Best Estimate P50 High Estimate P10 Eagle Shallow Wishbone Shallow Eagle Deep West Eagle Deep East Sum of Prospects

17 Scoping Economics Two Prospects Tested by One Well Success Scenario Eagle Deep West + Eagle Turbidite Probability % NPV10 $ billion NPV20 $ billion Eagle Turbidite Eagle Deep West No Discovery Expected Value $4.8 billion $2.4 billion Expected Value $ per barrel Expected Value $ per share $3.17 $1.59 risked $35 $18 17

18 Robust Economics Even at Lower Oil Price Reference Price $83.66 per bbl 18

19 Successful Frontier Exploration Will Be Rewarded $/bbl Wellhead Price Operating Cost 5.37 Capital Cost 2.20 Government of Guyana Take Netback $35.38 Capex per barrel oil per day < $5,000 Breakeven with 10% ROI -minimum wellhead price, $/bbl $ minimum field size, mmbbl 29.9 Floating Production Storage and Offloading Vessel 19

20 What are the Analysts Saying? Cormark Securities Inc. David Beddis August 20, 2008 Recommendation: Speculative Buy Target Price: $8 International Sector Update Oct 8, 2008 New Target: $5 Jennings Capital Corp. - Initiating Coverage Greg Chornoboy - March 11, 2008 Recommendation: Speculative Buy 12 month target $12 Toll Cross Securities Inc. - Initiating Coverage Guy Gordon - February 13, 2008 Recommendation: Speculative Buy Target Price $12 Wellington West Capital Markets - 9 Stocks with Big Potential Catalysts for 2008 Malcolm Shaw - January 21, 2008 Recommendation: Blue Sky Potential Target Price: $25 John S. Herold Inc. - Seam Insights Michael Wang - January 17, 2008 We think the company is an attractive target to be acquired outright, and should have no trouble finding a joint venture partner to farm in on favorable terms 20

21 Supportive Shareholders CGX Energy Inc. - OYL - TSXV (as of October 31, 2008) ,000, Shares Outstanding mm 4,500,000 Canadian Dollars Fully Diluted mm Average Daily Volume * 144,000 Insider Holdings (diluted) 10% Working Capital June 08 $35 mm * Calculated based on last three months trading 4,000,000 3,500,000 3,000,000 2,500,000 2,000,000 1,500,000 Volume ,000, , Sep Border Decision 21

22 Experienced Team of Directors and Officers Kerry Sully Warren Workman James Fairbairn Denis Clement John Cullen Edris K. Dookie Adrian Jackson Oliver Lennox-King Charlotte May President, CEO and Director - 38 years experience; past CEO of Ranchmen s Resources Vice President, Exploration - 34 years experience, previously with Amoco, Unocal and Ranchmen s CFO Director Co-founder and Director Co-founder and President of ON Energy; Executive Vice President, CGX Resources Independent Director - Equity Analyst with Investec Asset Management based in London, UK Independent Director - Chairman of the Board of Fronteer Development and Aurora Energy Resources Investor Relations 22

23 Rely on Experienced Consultants GeoSeis Inc. geological and geophysical data interpretation and mapping Gustavson Associates global consultant focusing on independent resource evaluation Jefferies Randall & Dewey top-ranked global energy advisor Fraser Milner Casgrain LLP #1 Canadian natural resources law firm by The Best Lawyers in Canada in 2006 and 2008 Elang Energy and Portigal Consultancy HTHP offshore drilling management, risk analysis, procurement 23