May 8, 2023

Chart Watch
16 AB oil production is being impacted by fires

17 US crude stocks drew against the seasonal trend

ARC Energy Charts 24 Natural gas curve in a steep contango

Visit www.arcenergyinstitute.com for more 31 Canadian gas production down due to fires
information on this publication and the Institute
35 Canadian gas drilling increased last week

Spot WTI Crude Spot Henry Hub Spot AESO Electricity EUA Emissions (ICE) Bloomberg Commodity Currency
$ US/ B $ US/ MMBtu $C/MWh EUR/Tonne Index $US/$ Cdn
78.52 á
á
103.70 á 0.7478 á
á á
73.16 2.12 83.71

1 Broad Equity Markets 2 Clean Energy Indices

Daily Index Values; January 2020 to Present Daily Index Values; January 2020 to Present

Indexed to MSCI Global ESG Index Indexed to W ilderh ill Clea n E nergy
Jan 2020 S&P/TSX Composite Jan 2020 Index
150 Dow Jones
400
140 S&P /TSX Renewabl e
Ene rgy & Clean
130 Technolog y In dex
300
120
110
200
100
90
100
80
70
60 0
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23

Broad market indices are one the many vital signs measuring the health of The performance of global and Canadian clean energy indices are compared
the economy. Energy demand is a function of economic health. against each other.
Source: Bloomberg, ARC Financial Corp. Source: Bloomberg, ARC Financial Corp.

3 Oil & Gas Service and Midstream Indices 4 Oil and Gas E&P Indices
Daily Index Values; January 2020 to Present Daily Index Values; January 2020 to Present

Indexed to Philadelphia Service I ndex Indexed to S&P 500 E&P

Jan 2020 Jan 2020
S&P/TSX Oil & Gas Storage & Transport ation In dex S&P/TSX E& P Index
140 220
200
120
180
100 160
140
80 120
100
60
80
40 60
40
20
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 20
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23

The performance of Canadian And US oilfield equities and Canadian The performance of Canadian and US oil & gas equities are compared
midstream equities are compared against each other. against each other.
Source: Bloomberg, Petroleum Services Association of Canada Source: Bloomberg, ARC Financial Corp.

Please see Advisories and Disclaimers at the end of the publication for important cautionary advisory and disclaimer language

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Energy Transition

5 Bloomberg Commodity Index 6 5-Yr, 5-Yr Forward Inflation Expectation Rate

Daily Index Values; January 2020 to Present Daily; Rolling 24 Month History

Index Value Percent July 3, 2006

160 3.0

140
2.5

120
2.0
100
1.5
80

60 1.0

40 0.5
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Feb-21 Jun-21 Oct-21 Feb-22 Jun-22 Oct-22 Feb-23

BCOM is a widely tracked benchmark for the commodities market. It is This series is a measure of expected inflation (on average) over the five-year
composed of 23 exchange-traded contracts on physical commodities. period that begins five years from today.
Source: Bloomberg Source: Federal Reserve Bank of St. Louis, (FRED) Economic Data

7 CO2e Emissions: ICE EUA Futures Contract 8 Trends in Atmospheric CO2

Daily; January 2020 to Present Mauna Loa Weekly Average: January 2020 to Present

EUR/Tonne Parts per Million (ppm)

120 430

100 425

80 420

60 415

40 410

20 405

0 400
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23

EU Allowances (EUA) are carbon credits equivalent to one tonne of CO2 The carbon dioxide data on Mauna Loa constitutes the longest record of
used in the European Union Emissions Trading Scheme (EU ETS). direct measurements of CO2 in the atmosphere.
Source: Bloomberg Source: NOAA

9 Texas Electricity: ERCOT North Hub Price 10 Alberta Electricity: AESO Average Pool Price
Daily and 30-Day Average; January 2020 to Present Daily and 30-Day Average; January 2020 to Present

$US/MWh ERCOT North 345KV Month 1 $C/MWh AES O Ave rage Daily Po ol
300 400 Price
30 per. Mo v. A vg . (ERCOT 30 per. Mo v. A vg . (AES O
350
250 North 3 45KV Month 1) Averag e Daily Pool Price)
300
200
250

150 200

150
100
100
50
50

0 0
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23

ERCOT is the grid operator for 90% of the electricity sold in Texas. The price The Alberta Electric System Operator (AESO) manages and operates the
shown is for the North Hub and is the wholesale price. provincial power grid.
Source: Bloomberg Source: Bloomberg

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 May 8, 2023

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Crude Oil

11 WTI Crude Oil Price and Differential to Brent 12 US Crude Oil Futures
Near-Month WTI and Brent Differential; Rolling 12-Month History West Texas Intermediate (WTI), Next 36 Months

WTI D iff WTI $US/B July 3, 2006

5/8/2023
WTI ($US/B) WTI Dif f to Brent ($US/B)
WTI
140 20 4/7/2023
90
120
16
100
80
80 12

60 8 70
40
4
20
60
0 0 1 6 11 16 21 26 31 36
May-22 Jul-22 Sep -22 Nov-22 Jan-23 Mar-23
Months

North American crude oil prices can sometimes disconnect from global Forward prices for WTI are plotted for the next 36 contracts, and compared
prices depending on regional supply and demand dynamics. against the same contracts one month prior.
Source: Bloomberg Source: Bloomberg

13 CDN Heavy Oil Price Differential to WTI 14 CDN Light Crude Oil Price Differential to WTI
Western Canadian Select (WCS) Differential; Rolling 12-Month History WTI and Edmonton Light differential; Rolling 12-Month History

WCS ($US/B) WCS Diff. WCS Dif f to WTI ($US/B) Edm. Light ($US/B) Edm. Light Dif f to WTI ($US/B)
WCS 140 Spot WT I 20
120 30
Spot Edmonton Light
120
100 25 16
100
80 20
80 12

60 15
60 8
40 10 40
4
20 5 20

0 0
0 0 May-22 Aug -22 Nov-22 Feb-23 May-23
May-22 Jul-22 Sep-22 Nov-22 Jan-23 Mar-23 May-23

The differential should reflect quality differences and transportation costs. The differential should reflect the transportation cost from Alberta to Cushing.
Greater discounts can result from infrastructure or refinery outages. Greater discounts can result from infrastructure or refinery outages.
Source: Bloomberg Source: Bloomberg

15 Daily NGL Prices as a % of Edmonton Light 16 Alberta Oil Production

NGL Prices at Edmonton, AB, 10 Day Rolling Average Shown Monthly; Conventional and Oil Sands
% of Edm. Cond ensate MMB/d Upgrad ed Oil Sands
Light Butane ( Spot) 4.5 Non-Upgra ded Oil Sand s
Millions

160 % Propa ne (Spot)

4.0 Conventional
140 % 3.5
120 % 3.0
100 % 2.5

80% 2.0

60% 1.5
1.0
40%
0.5
20%
0.0
0% Jan-18 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23
Mar-21 Jul-21 Nov-21 Mar-22 Jul-22 Nov-22 Mar-23
Natural gas liquids have become critical contributors to producer’s cash flow. Most of Canada’s oil production comes from Alberta; split between oil sands
Prices are influenced by the price of oil as well as local supply and demand. and conventional production.
Source: Bloomberg, ARC Financial Corp. Source: Alberta Energy Regulator

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 May 8, 2023

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Crude Oil

17 US Crude Oil Stocks 18 US Petroleum Product Consumption

Historical Range and Current Year Levels Top Three Product Categories; Jan 2020 to Present

MMB
MMB/d July 3, 2006
600 11 Gasoline
10
5-Year
550 9
Max
8
500
7

450 6
Diesel
5
400 4
2023 5-Year 5-Year
3
350 Average Min Jet
2
1
300
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 0
Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23

US crude oil stock levels can affect crude oil prices. Stock levels for the Gasoline, diesel and jet fuel consumption represent the majority of oil use in
current year are represented by the blue line. the US.
Source: U.S. Energy Information Administration Source: U.S. Energy Information Administration

19 US Weekly Crude Oil Production 20 US Crude Oil Imports

US Field Production of Crude Oil; 2019 to Present Weekly Data; 2018 to Present
MMB/d MMB/d Other Imp orts
10
14 Imp orts fro m Canada
9
8
13
7
6
12
5

11 4
3

10 2
1
9 0
Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Jan-18 Jul-18 Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22

Weekly production is modelled by the EIA. It is less accurate then monthly Crude oil imports from Canada are taking market share from overseas
reported numbers, but is instructive of up to date changes. imports.
Source: U.S. Energy Information Administration Source: U.S. Energy Information Administration

21 OECD Total Industry Oil Stocks 22 OPEC and Russian Oil Production
Monthly; 2012 to Present Monthly; Rolling 60-Month History
Saudi and Other OPEC
MMB
Russia (MMB/d)
3,500 12 (MMB/d) 24

3,250 11
Russia 22

3,000 10 20

2,750
Saudi
9 18

2,500
Other
8 16
OPEC
2,250 7 14
Jan-12 Jan-14 Jan-16 Jan-18 Jan-20 Jan-22 Apr -18 Apr -19 Apr -20 Apr -21 Apr -22 Apr -23

OECD stock levels can affect crude oil prices. OPEC’s production levels relative to its sustainable and spare capacity
influences global crude prices. Note: scale has been expanded.
Source: International Energy Agency
Source: Bloomberg, OPEC, US Department of Energy

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Natural Gas

23 Near-Month North American Natural Gas Prices 24 US Natural Gas Futures

Daily Prices; Rolling 12-Month History Nymex (Henry Hub) Next 36 Months

$US/MMBtu July 3, 2006

5/8/2023
10.00
Henry Hub 4/7/2023
7.00
$US/MMBtu
8.00
6.00

6.00 5.00

AECO 4.00
4.00 Differential $C/GJ
$US/MMBtu 3.00
2.00
2.00
1 6 11 16 21 26 31 36
0.00
May 13 Aug 11 Nov 9 Feb 7 May 8 Months

Near-month prices at AECO track Henry Hub prices, the exchange rate and Forward contract prices are plotted for the next 36 months, and compared
the cost of transportation. Local factors can also affect price. against the curve one month prior.
Source: Bloomberg Source: Bloomberg

25 Global Natural Gas Prices 26 CDN Natural Gas Futures

Japan/Korea, UK NBP, Henry Hub; 10-Day Moving Average Price AECO Hub (Bloomberg Estimate) Next 36 Months
$US/MMBtu 5/8/2023
$C/GJ
70
Japan/Korea 4/7/2023
6.00
60 LNG
5.00
50

40 4.00

30 3.00
UK NBP
20 2.00
Henry
10 Hub
1.00
1 6 11 16 21 26 31 36
0
May 20 Sep 20 Jan 21 May 21 Sep 21 Jan 22 May 22 Sep 22 Jan 23 May 23 Months

International natural gas prices strongly impact the economics of proposed AECO forward prices mimic Henry Hub futures minus a differential.
LNG projects.
Source: Bloomberg Source: Bloomberg

27 Pipeline Flows Out of Western Canada 28 US Natural Gas Exports – Excluding Canada
Daily; Historical Tracks and Current Year Levels Daily; Jan 2018 to Present
Bcf /d Bcf /d
24
12 5-Year
Max
20
11 2023 5-Year
Average
16
Mexico
10
12
9
8
LNG
8
4
5-Year
7
Min
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan-18 Jan-19 Jan-20 Jan-21 Jan-22 Jan-23

The ability of gas producers to move gas out of the WCSB to eastern markets Between exports to Mexico and LNG shipments, the US is growing as a
and the US is a major factor in local natural gas prices. natural gas exporter. Robust US supply growth has driven this trend.
Source: Various Pipeline Companies Source: Bloomberg

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ARC Energy Charts

Natural Gas

29 Alberta Natural Gas Demand 30 US Domestic Natural Gas Demand

TransCanada Intra-AB Deliveries; Current Year and Historical Tracks Daily; Historical Tracks and Current Year Levels

Bcf /d Bcf /d July 3, 2006

8.0 2023 130

Millions
7.5
120
7.0
6.5 110
6.0 2022 100
5.5 90
5.0
80
4.5 2022
70
4.0 2023
3.5 60
3.0 50
2.5 40
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Alberta natural gas demand has grown steadily in recent years, largely Domestic US demand fluctuates in the summer and during the winter as
driven by new oil sands demand and power generation projects. weather is an important driver of consumption.
Source: TransCanada Pipelines Source: Bloomberg

31 Daily Western CDN Production 32 Total US Dry Natural Gas Production

Estimated Using Major Pipeline Receipts Daily; Jan 2020 to Present

Bcf /d Bcf /d
105
19 2023 2022
Millions

18 100

17 95

16 90

15 85

14 80

13 75

12 70
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23

This includes receipts on the TCPL, Alliance, WestCoast and TransGas US production started ramping up in late 2007 and continues to grow year
pipelines. over year.
Source: Various Pipeline Companies Source: Bloomberg

33 Western CDN Natural Gas Storage Levels 34 Total Working Natural Gas in US Storage
Weekly; Current Year and Historic Tracks Historical Range and Current Year Levels
Bcf Tcf
5-Year
600 5-Year 4.5 5-Year Max
5-Year
Max Average
Average 4.0
500
3.5
2023
400
3.0

300 2.5 5-Year

5-Year Min
2.0
200 Min
2023 1.5
100
1.0
0 0.5
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Canada’s natural gas storage level provides a good metric if the country is The EIA reports changes in US natural gas inventories held in underground
well stocked. Abnormally high or low storage can affect the basis. storage facilities on a weekly basis.
Source: Bloomberg Source: U.S. Energy Information Administration

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Oilfield Activity

35 Canada: Weekly Gas Drilling Activity 36 United States: Weekly Gas Drilling Activity
Baker Hughes Drilling Rig Count; Current Year and Historical Range Baker Hughes Gas Rig Counts; 2020 to Present
# of Rigs
# of Gas Rigs - Play Lev el Marcellus (Ho rizo nta l) July 3, 2006
125 180 Haynesvill e (Hori zon tal)
160 Other

100 5-Year 140

5-Year Average
120
Max
75 100
2023 80
50
60

5-Year 40
25
Min 20

0 0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23

Unlike US drilling activity, Canadian rigs are dispatched seasonally. Capital Tracking US gas drilling by major play provides insight into the composition
allocation by operators is driven by views of future oil and gas prices. of US gas supply and growth trends.
Source: Baker Hughes Source: Baker Hughes

37 Canada: Weekly Oil Drilling Activity 38 United States: Oil Drilling Activity
Baker Hughes Drilling Rig Count; Current Year and Historical Range Baker Hughes Oil Rig Counts; 2020 to Present
# of Rigs # of Oil Rigs - Play Lev el
800 Per mia n (Hor izon tal)
250
Other
700

200 600
2023
500
150 5-Year 400
Max
100 300

5-Year 200
50 5-Year Average
100
Min
0
0 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Unlike US drilling activity, Canadian rigs are dispatched seasonally. Capital Tracking US oil drilling by major play provides insight into the composition of
allocation by operators is driven by views of future oil and gas prices. US oil supply and growth trends.
Source: Baker Hughes Source: Baker Hughes

39 Canada: Monthly Wells Drilled 40 United States: Monthly Wells Drilled

Current Year vs Years Prior Current Year vs Years Prior
Wells Drilled Wells Drilled
800 202 0 202 1 202 2 202 3 202 0 202 1 202 2 202 3
120 0
700
100 0
600

500 800

400 600

300
400
200
200
100

0 0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Total rig-releases for exploratory and development wells are highlighted in Total wells drilled in US Drilling Productivity Report regions are shown.
this chart. Rig releases for the current year are shown in red. These are the most active onshore US plays.
Source: Daily Oil Bulletin/JWN Source: EIA

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ARC Energy Charts

Canadian Industry Metrics

Estimated Capital Flow in the Canadian Oil and Gas Economy for 2023
Industry Revenue, Cash Flow, Reinvestment, Drilling Activity and Production
July 3, 2006
Foreign Investment
G&A and Capital Outflow
$C 190.1 Royalties
$C 62.28 per BOE Billion & Taxes Dividends and
Distributions

Oil & Gas E&P Cash

Revenue Debt,
Prices Flow Equity
$C 82.3
Billion

Operating CAPEX $C 38.1

8.4 Million
Capital Flow Expenditures Billion
BOE/day
Production in the
Volume
Canadian
Oil and Gas Exploration &
Development
Economy
6,004
Reserve Wells Land,
Service Sector Acquisitions
Additions Drilling
Revenue
Activity

41 Canadian Industry Statistics: Historical Data and Forecast

Canadian Industry Metrics

P ric e P ro duc t io n V o lum e C a pit a l Inf lo w R e inv e s t m e nt D rilling We ll S plit
Wells
Average Edmonton Conv. Bitumen + Natural Total Total After-tax Conv. Oil Reinvest Rig Avg Rig Oil Gas
Price Par AECO Liquids Synthetic Gas Volume Revenue Cash Flow and Gas Oilsands Ratio Releas. Utiliz. Wells Wells

Average Average M BOE/d M BOE/d $C $C $C $C #/

$/BOE $C/B $C/GJ M BOE/d M BOE/d (@ 6:1) (@ 6:1) millions millions millions millions x:1 Year % % %

2 0 14 60.69 95.07 4.23 2,085 1,964 2,480 6,530 144,660 66,972 46,872 33,868 1.21 11,222 45% 78% 22%
2 0 15 37.34 57.63 2.56 1,995 2,381 2,531 6,907 94,127 29,985 31,609 22,929 1.82 5,382 24% 69% 31%
2 0 16 32.61 53.09 2.06 2,013 2,421 2,564 6,998 83,298 23,701 23,040 15,426 1.62 4,060 17% 73% 27%
2 0 17 39.18 62.42 2.10 2,119 2,674 2,605 7,398 105,788 45,031 28,712 13,803 0.94 7,076 30% 73% 27%
2 0 18 39.57 69.24 1.46 2,292 2,913 2,737 7,942 114,705 49,708 27,374 11,661 0.79 6,927 32% 79% 21%
2 0 19 42.34 69.02 1.70 2,409 2,950 2,673 8,032 124,115 55,343 25,847 9,306 0.64 4,886 26% 81% 19%
2020 30.29 46.10 2.12 2,248 2,843 2,566 7,657 84,647 29,807 14,158 7,254 0.72 2,970 18% 65% 35%
2021 51.76 80.83 3.45 2,239 3,103 2,662 8,004 151,222 71,041 16,819 8,957 0.36 4,638 24% 71% 29%
2022e 77.29 119.95 5.09 2,169 3,176 2,701 8,046 227,006 120,526 23,378 10,749 0.28 5,723 24% 70% 30%
2023e 62.28 103.93 2.78 2,145 3,449 2,768 8,361 190,071 82,287 25,748 12,361 0.46 6,004 24% 70% 30%

Advisories and Disclaimers: This document is provided for informational purposes only and none of the information contained herein is intended to provide, nor should be
construed as, investment, financial, legal or other advice and should not be relied upon as such. Certain of the information and data contained herein has been obtained or
prepared from publicly available documents and other sources prepared by third parties, and ARC has relied upon such information and data. ARC does not audit or
independently verify such information and data and ARC makes no representations or warranties as to the accuracy or completeness of such information and data nor the
conclusions derived therefrom. This document has been published on the basis that ARC shall not be responsible for, and ARC hereby expressly disclaims any responsibility
or liability for, any financial or other losses or damages of any nature whatsoever arising from or otherwise relating to any use of this document.

Certain information contained herein may constitute forward-looking information and forward-looking statements" (collectively, "forward-looking statements") under the
meaning of applicable Canadian securities laws. Forward-looking statements include estimates, plans, expectations, intentions, opinions, forecasts, projections, guidance or
other statements that are not statements of fact, including but not limited to global and industry economic conditions and policies, production, demand and commodity prices.
Although ARC believes that the assumptions underlying and expectations reflected in such forward-looking statements are reasonable, it can give no (and does not give any)
assurance that such assumptions and expectations will prove to have been correct. Such forward-looking statements involve known and unknown risks, uncertainties and
other factors outside of ARC's control that may cause actual results to differ materially from those expressed herein. Neither ARC nor any of its affiliates undertakes any
obligation to publicly revise such forward-looking statements to reflect subsequent events or circumstances, except as required by law.

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