boe/d production - DeeThree Exploration Ltd.

Shifting Focus
April 2011
March, 2011 | page 1
Corporate Summary
 Capitalized private E&P in Jan./07; reverse takeover of
Royal Capital Corp. (a public capital pool company) in Jun./09;
TSX-V ; moved to TSX in Oct./10
 Focused asset base
 Proven operating & financial strategy
 Experienced team with a track record of profitability &
value creation
 A platform for growth
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March, 2011 | page 2
Experienced Leadership
Directors
 Michael Kabanuk
Executive Chairman
 Brendan Carrigy
VP Exploration, DeeThree Exploration Ltd.
 Martin Cheyne
President & CEO, DeeThree Exploration Ltd.
 Henry Hamm
Independent Businessman
 Dennis Nerland
Partner, Shea Nerland Calnan LLP
 Brad Porter
Independent Businessman
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March, 2011 | page 3
Experienced Leadership
Management
 Martin Cheyne – President & CEO
 Over 25 years experience
 Dual Exploration, Devlan Exploration, Bredal Energy
 Gail Hannon – CFO
 Over 20 years experience
 Artek Exploration, White Fire Energy, Lightning Energy
 Brendan Carrigy – VP Exploration
 Over 25 years experience
 Cyries Energy, Cequel Energy, PrimeWest Energy
 Trevor Murray – VP Land
 Over 10 years experience
 Cyries Energy, PrimeWest Energy, Calpine Canada
 Clayton Thatcher – VP Geophysics
 Over 7 years experience
 Encana Corporation, Cenovus Energy
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March, 2011 | page 4
Market Facts – as at April 28, 2011
 Exchange: Symbol TSX :
DTX
 Common shares outstanding
 Basic
62.7 MM
 Fully diluted
64.6 MM
 Insider holdings
9%
 Market capitalization (@ $3.91/share)
$245 MM
 Credit facility (1)
$20.0 MM
(1) The Company’s lender approved a credit facility increase to $40 million; however
DeeThree elected an increase to $20 million in order to reduce standby fees on
unutilized balance.
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By The Numbers
 Current Production – 2,250 BOE/d
 Oil & NGL Production – 30%
 Gas Production – 70%
 Reserves (P+P) – 6.8 MMBOE
 Two Oil Resource Plays: Alberta Bakken & Belly River light oil play
 CAPEX: 42 MM
 14 Horizontal Oil Wells Planned:
 7 – Alberta Bakken Oil Wells (2 drilled to date)
 7 – Belly River/Montney Oil Wells
 Provide a balanced & diverse production base (2011 proforma exit: ~60%
crude oil & NGLs
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March, 2011 | page 6
Brazeau – West Pembina
 Light oil resource play
Belly River Light Oil Resource Play
 Operated, high W.I. (88%)
 60 producing wells
 940 boe/d net productive
capacity
 Production from Belly River
formation
 Large contiguous land block
(35 net sections)
 Ownership in oil facilities &
infrastructure
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March, 2011 | page 7
Brazeau – West Pembina
Belly River Light Oil Resource Play
 Predictable base production
with very little decline from
existing vertical wells
 Significant undeveloped oil in
place
 42o API oil with liquids-rich
(55 bbls/MMcf) associated
gas
Stable 400 bbls/d
from 2005 to 2011
Brazeau Unit #6
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Brazeau – West Pembina
Belly River Light Oil Resource Play
 Extensive vertical control with
Gamma
Neutron/Density Resistivity
Net Pay
net pay ranging from 20-40
metres
11.6 m
@ 15%
 6 distinct pay zones over 250
5.6 m
@ 12%
metres
9.2 m
@12%
 OOIP: 48 MMbbls/section
(extrapolation of wellbore)
5.4 m
@ 12%
 Typical 'tight rock 'production
profiles with high initial IPs &
long production tails; low
decline
4.8 m
@ 10%
7.0 m
@ 12%
8-19 Vertical Producer
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March, 2011 | page 9
Brazeau – West Pembina
 Proven horizontal success in
Belly River Light Oil Resource Play
pool with IP30 at 240 bbls/d
 Sproule reserves: 135 Mboe
IP30 – 240 bbls/d
Internal est.: 175 Mboe
 $2.5 MM net capital per well
 $5.0 MM NPV10
 Initial mapping has identified
>50 well locations
 Ultimately predict 100-150
horizontal locations to be drilled
Horizontal Well Performance
6-19 Horizontal Well
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March, 2011 | page 10
Lethbridge
 Principal asset acquired in Nov./08 (500
boe/d production)
 Predictable, stable production (capable
1,000 boe/d)
 Infrastructure ownership (200+ km gas
pipelines, 6 compressor stations,
processing facilities)
 New emerging light oil play
(Bakken/Three Forks/Wabamun)
 Large drilling inventory (>70 shallow
locations and >20 identified Bakken
locations)
 Multi-zone targets (Barons, Bow Island,
Sunburst, Bakken, Three Forks and
Wabamun formations)
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March, 2011 | page 11
Alberta Bakken Fairway
 280 sections of identified
prospective DeeThree
lands.
Bakken –
Migration
Play Fairway
 Recent land sales averaging
$500 - $1,300/acre with
most of the available land
now acquired.
 Several major oil and gas
companies are actively
licensing and drilling in
proximity to DeeThree
lands.
12
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March, 2011 | page 12
Alberta Bakken Fairway
Joint Venture Area
2
= Bakken
Reservoir focus
area
3
4
1
10
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March, 2011 | page 13
Why Invest in DeeThree?

Expansive land base within the emerging Alberta
Bakken light oil resource play

Large inventory of repeatable light oil drilling locations in
the Brazeau Belly River

Early stage oil & gas exploration company with a solid
platform for growth

Managed by senior oil patch players & experienced
technical team
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March, 2011 | page 14
Advisory
Certain information set forth in this presentation contains forward-looking statements including management’s
assessments of future plans, operations, expectations of future production and cash flow. By their nature,
forward-looking statements are subject to numerous risks & uncertainties, some of which are beyond DeeThree
Exploration Ltd.'s control, including the impact of general economic conditions, industry conditions, volatility of
commodity prices, currency fluctuations, imprecision of reserves estimates, environmental risks, competition
from other industry participants, the lack of availability of qualified personnel or management, stock market
volatility & ability to access sufficient capital from internal & external sources. Readers are cautioned that the
assumptions used in the preparation of such information, although considered reasonable at the time of
preparation, may prove to be imprecise, & as such, undue reliance should not be placed on forward-looking
statements. DeeThree's actual results, performance or achievement could differ materially from those
expressed in, or implied by, these forward-looking statements, & accordingly, no assurance can be given that
any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so,
what benefits that DeeThree will derive therefrom. DeeThree disclaims any intention or obligation to update or
revise any forward-looking statements, whether as a result of new information, future events or otherwise
except as required by law. This presentation uses "funds flow from operations“, which should not be
considered an alternative to or more meaningful than net earnings or cash flow from operating activities as
determined in accordance with Canadian generally accepted accounting principles ("GAAP") as an indicator of
the Company's performance. This term does not have any standardized meaning as prescribed by GAAP.
DeeThree's determination of funds from operations may not be comparable to that reported by other
companies. Management uses funds from operations to analyze operating performance & leverage, &
considers funds from operations to be a key measure as it demonstrates the Company's ability to generate
cash necessary to fund future capital investments & to repay debt.
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Corporate Information
Head Office
Suite 700
520 Fifth Avenue S.W.
Calgary, AB T2P 3R7
Tel:
(403) 767-3060
Fax:
(403) 263-9710
Website:
www.deethree.ca
Auditors
KPMG LLP
Banker
Canadian Imperial Bank of Commerce
Evaluation Engineers
Sproule Associates Limited
Legal Counsel
Davis LLP
Transfer Agent
Olympia Trust Company
TSX Listing
Trading Symbol: DTX
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March, 2011 | page 16
Shifting Focus
www.deethree.ca
TSX : DTX
March, 2011 | page 17