Reserve Information

2015 YEAR END RESERVES

Whitecap's 2015 year end reserves were evaluated by independent reserves evaluator McDaniel & Associates Consultants Ltd. ("McDaniels") in accordance with the definitions, standards and procedures contained in the Canadian Oil and Gas Evaluation Handbook (“COGE Handbook”) and National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities (“NI 51-101”) as of December 31, 2015. Additional reserve information as required under NI 51-101 is included in our Annual Information Form which has been filed on SEDAR.

The financial and operational information below is based on estimates and are unaudited. 

2015 Reserve Highlights

Proved Developed Producing (“PDP”)

  • Increased PDP reserves by 22% to 113.2 MMboe (75% oil and NGLs) and 4% per fully diluted share.
  • Added 14.0 MMboe of PDP reserves at an F&D cost of $12.57/boe which generated a recycle ratio of 2.9x.
  • Our 2015 drilling program resulted in PDP reserve additions replacing 93% of production and, when including PDP acquisition reserves, replaced 236% of production.
  • PDP reserves represent 57% of total proved reserves and 41% of total proved plus probable reserves on a reserve basis.
  • Positive PDP technical revisions of 12.0 MMboe of which 7.0 MMboe (58%) is related to well or pool performance being better than previously forecast in the prior year reserve report and 4.4 MMboe (37%) is related to the outperformance of our waterflood properties.
  • Increased the PDP net present value of the future net revenue discounted at 10% (“NPV10”) to $1.9 billion or $6.39 per fully diluted share.

Total Proved (“TP”)

  • Increased TP reserves by 29% to 200.0 MMboe (77% oil and NGLs) and 10% per fully diluted share.
  • Added 17.8 MMboe of TP reserves at an F&D cost of $8.86/boe, including changes in FDC, which generated  a recycle ratio of 4.1x.
  • Our 2015 drilling program resulted in TP reserve additions replacing 120% of production and, when including TP acquisition reserves, replaced 400% of production.
  • TP reserves comprise 72% of total proved plus probable reserves on a reserve basis and 72% on an NPV10 basis.
  • Increased the TP NPV10 by 7% to $3.0 billion or $9.86 per fully diluted share.

Total Proved Plus Probable (“TPP”)

  • Increased TPP reserves by 27% to 278.9 MMboe (77% oil and NGLs) and 8% per fully diluted share.
  • Added 18.2 MMboe of TPP reserves at an F&D cost of $6.97/boe, including changes in FDC, which generated a recycle ratio of 5.2x.
  • Achieved FD&A costs of $18.27 per TPP boe, including FDC, which results in a recycle ratio of 2.0x.
  • Our 2015 drilling program resulted in TPP reserve additions replacing 122% of production and, when including TPP acquisition reserves, replaced 499% of production.
  • Increased the TPP NPV10 by 10% to $4.1 billion or $13.61 per fully diluted share despite a 40% decrease in McDaniels’ US$ WTI forecast in 2016.

Summary of Reserves

(Forecast Pricing)

As at December 31, 2015 (1)

 Description Oil (Mbbl) Gas (MMcf) NGL (Mbbl) Total (Mboe)
 Proved producing 76,929 169,278 8,046 113,188
 Proved non-producing 228 3,488 52 862
 Proved undeveloped 63,646 99,886 5,609 85,902
 Total proved (3) 140,803 272,652 13,707 199,952
 Probable 52,979 117,819 6,287 78,902
 Total proved plus probable (3) 193,782 390,471 19,994 278,854

(1) Based on McDaniels’ January 1, 2016 forecast prices.
(2) Company share reserves are the Company’s total working interest reserves before the deduction of any royalties and including any royalty interests payable to the Company.
(3) Numbers may not add due to rounding.

Total FDC to develop TP reserves is $1.5 billion undiscounted ($1.2 billion discounted at 10%) and to develop TPP reserves is $1.6 billion undiscounted ($1.3 billion discounted at 10%).

Summary of Before Tax Net Present Values

(Forecast Pricing)

As at December 31, 2015 (1)

Discount Rate
 Description 0% 5% 10% 15% 20%
 Proved producing 3,691 2,566 1,947 1,569 1,319
 Proved non-producing 16 10 7 5 4
 Undeveloped 2,635 1,625 1,050 700 475
 Total proved (3) 6,342 4,201 3,004 2,275 1,798
 Probable 3,978 1,916 1,140 778 579
 Total proved plus probable (3) 10,319 6,117 4,143 3,053 2,377
 Per fully diluted share $33.89 $20.09 $13.61 $10.02 $7.81

(1) Based on McDaniels’ January 1, 2016 forecast prices.
(2) Includes abandonment and reclamation costs as defined in NI 51-101.
(3) Numbers may not add due to rounding.

Pricing Assumptions

The reserve evaluation was based on McDaniels’ forecast pricing and foreign exchange rates at January 1, 2016 as outlined below.

Forecast
2016 45.00 56.60 2.70 - 0.730
2017 53.60 66.40 3.20 2.00 0.750
2018 62.40 72.80 3.55 2.00 0.800
2019 69.00 80.90 3.85 2.00 0.800
2020 73.10 83.20 3.95 2.00 0.825
2021 77.30 88.20 4.20 2.00 0.825
2022 81.60 93.30 4.45 2.00 0.825
2023 86.20 98.70 4.70 2.00 0.825
Thereafter +2%/yr +2%/yr +2%/yr 2.00 0.825

(1)  Inflation rate for costs.
(2) Exchange rate used to generate the benchmark reference prices in this table.

Performance Measures

The following table highlights annual performance ratios based on the evaluation of our petroleum and natural gas reserves prepared by McDaniels.

Proved Developed Producing
F&D (1) $12.57 $21.84 $23.98 $18.19
F&D recycle ratio (2) 2.9 2.1 1.8 2.4
FD&A (3) $29.46 $29.62 $27.30 $29.06
FD&A recycle ratio (2) 1.2 1.5 1.6 1.4
Production replacement (4) 236% 437% 319% 323%
RLI (years) (5) 7.6 7.8 7.3 7.6
Total Proved
F&D (1) $8.86 $19.03 $18.63 $14.45
F&D recycle ratio (2) 4.1x 2.4x 2.3x 3.1x
FD&A (3) $23.11 $26.43 $23.36 $24.32
FD&A recycle ratio (2) 1.6x 1.7x 1.8x 1.7x
Production replacement (4) 400% 610% 566% 508%
RLI (years) (5) 13.4 13.1 13.1 13.2
Total Proved Plus Probable
F&D (1) $6.97 $13.80 $15.52 $11.14
F&D recycle ratio (2) 5.2x 3.3x 2.7x 4.0x
FD&A (3) $18.27 $19.56 $18.31 $18.73
FD&A recycle ratio (2) 2.0x 2.3x 2.3x 2.2x
Production replacement (4) 499% 833% 723% 662%
RLI (years) (5) 18.7 18.5 18.4 18.5

(1) F&D costs are calculated as the sum of development capital plus the change in FDC for the period divided by the change in reserves that are characterized as development for the period.
(2) Recycle ratio is calculated as operating netback divided by F&D or FD&A costs. Operating netback is calculated as revenue (including realized hedging gains and losses) minus royalties, operating expenses, and transportation expenses.  Our operating netback in 2015 was $36.11/boe.
(3) FD&A costs are calculated as the sum of development capital plus acquisition capital plus the change in FDC for the period divided by the change in total reserves for the period.
(4) Production replacement ratio is calculated as total reserve additions (including acquisitions net of dispositions) divided by annual production. Whitecap averaged 40,953 boe/d in 2015.
(5) Reserve life index (“RLI”) is calculated as total Company share reserves divided by annual production.