Investor Presentation July 2017 | Confidential Disclaimer
Confidentiality and Disclosures This presentation is strictly confidential, has not been independently verified and is being furnished to you solely for your information. It may not be reproduced or redistributed to any other person, and it may not be published, in whole or in part, for any purpose. By receiving this presentation, you become bound by the confidentiality obligation referred to above. Failure to comply with such confidentiality obligation may result in civil, administrative or criminal liability. The distribution of this presentation in other jurisdictions may also be restricted by law, and persons into whose possession this presentation comes should inform themselves about and observe any such restrictions. This presentation does not constitute or form part of any offer for sale or solicitation of any offer to buy any securities in the United States or elsewhere nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment to purchase shares, nor is it an invitation to carry out investment activities, nor does it constitute the basis, in whole or in part, for the execution of any agreement or commitment of any kind. Specifically, this presentation does not constitute a placement prospectus (prospecto de colocación) or equivalent document, and the information contained herein is general in nature and is distributed for information purposes only. Securities may not be offered or sold in the United States absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended (the “Act”). Vista Oil & Gas, S.A.B. de C.V., a sociedad anónima bursátil organized under the laws of Mexico (the “Company” or “Vista”), has not and does not intend to register any securities under the Act or offer any securities to the public in the United States. Any decision to purchase shares in any offering should be made solely on the basis of the information contained in the Mexican prospectus (prospecto de colocación) to be registered with the Mexican Banking and Securities Commission (Comisión Nacional Bancaria y de Valores) or any offering circular published in due course in relation to any such offering. No reliance may be placed for any purpose whatsoever on the information contained in this document or on its completeness. No representation or warranty, express or implied, is given or will be given by or on behalf of the Company, either of the Joint Global Coordinators and Bookrunners or any of their respective affiliates or agents, or any of such persons’ directors, officers, employees or advisors or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this document, and any reliance you place on them will be at your sole risk. In addition, no responsibility, obligation or liability (whether direct or indirect, in contract, tort or otherwise) is or will be accepted by the Company, any of the Joint Global Coordinators and Bookrunners, or any other person in relation to such information or opinions or any other matter in connection with this document or its contents or otherwise arising in connection therewith. By attending this presentation or by agreeing to view any of the materials presented, you agree to be bound by the foregoing limitations. Neither the Mexican Banking and Securities Commission (Comisión Nacional Bancaria y de Valores), the U.S. Securities and Exchange Comission nor any other authority has approved or disapproved the contents of this presentation, or the adequacy or truthfulness of the information contained herein. This presentation contains and related discussion may contain “forward-looking statements”. All statements contained in this presentation and related discussion other than statements of historical facts are forward- looking statements. Forward-looking statements include information concerning possible or assumed future results of operations, including descriptions of our business plans and strategies. You can identify forward- looking statements by the use of words such as “may,” “might,” “will,” “should,” “could,” “would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “project,” “predict,” “intend,” “future,” “potential,” “suggest,” “target,” “forecast,” “continue,” and other similar expressions. Forward-looking statements are not historical facts, and are based upon management’s current expectations, beliefs, estimates and projections, and various assumptions, many of which are inherently uncertain and beyond our control. Such expectations, beliefs, estimates and projections are expressed in good faith and management believes there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs, estimates and projections will be achieved and actual results may differ materially from what is expressed in or indicated by the forward-looking statements. Forward-looking statements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the forward-looking statements. Forward-looking statements speak only as of the date the statements are made. Riverstone assumes no obligation to update forward-looking statements to reflect actual results, subsequent events or circumstances or other changes affecting forward-looking information except to the extent required by applicable securities laws. Certain information in this presentation is based upon management forecasts and reflects prevailing conditions and management’s views as of this date, all of which are subject to change. Forward-looking statements in this presentation may include, for example, hypothetical statements about: our ability to select an appropriate target business or businesses; our ability to complete our initial business combination; our expectations around the performance of the prospective target business or businesses; our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they would then receive expense reimbursements; our potential ability to obtain additional financing to complete our initial business combination; our pool of prospective target businesses; the ability of our officers and directors to generate a number of potential acquisition opportunities; our public securities’ potential liquidity and trading; the availability of a market for our securities; the use of proceeds not held in the escrow account or available to us from interest income on the escrow account balance; or our financial performance following this offering. You should not take any statement regarding past trends or activities as a representation that the trends or activities will continue in the future. Accordingly, you should not put undue reliance on these statements. This presentation is not intended to constitute, and should not be construed as investment advice. Many statements and the case studies contained herein relate to Riverstone or certain of its affiliated funds. An investment in Vista Oil & Gas S.A.B. de C.V. is not an investment in Riverstone or any such fund. The historical results of Riverstone or its funds are not necessarily indicative of future performance of Vista Oil & Gas S.A.B. de C.V.
1 Vista Investment Platform A vehicle custom-built to seize LatAm E&P opportunities
Riverstone Miguel Galuccio ■ Leading global energy-focused private equity firm with ■ Tripled YPF S.A.’s (“YPF”) market cap under his one of the largest portfolio footprints in the world leadership, reaching US$15,000mm(1) − More than US$35,000mm of committed capital to ■ YPF raised over US$8bn from international and local more than 130 transactions capital markets under his leadership, with 30 new ■ Extensive investment and operating expertise in energy issuances below Argentina’s sovereign yield developed over multiple commodity price cycles ■ More than 17-year track record of optimizing high-quality ■ Executed over 20 M&A transactions at YPF with businesses and leading management teams industry leaders such as Apache, Chevron, Petronas, ■ One of the most active energy funds in Mexico since the and Dow, for total deal value over US$4,000mm Energy Reform ■ Led the creation of Schlumberger Production − Six operating companies in the portfolio Management (“SPM”), which is currently an important − CKD issuance of Ps$12,500mm to invest in growth segment for Schlumberger Limited (“SLB”) conventional energy globally, having reached production of 235 Mboe/d ■ One of the most experienced energy funds in US listed ■ Brings along seasoned management team, with proven acquisition companies (“SPAC”) track record working together − 2 issuances for a total of US$1,500mm
Vista – LatAm focused listed acquisition company A well-suited capital structure to execute the business plan with access to capital
Operating experience of a seasoned exploration and production (“E&P”) CEO combined with the investment expertise of one of the world’s largest energy-focused private equity firms to take advantage of a distinct window of opportunity to acquire and develop assets in the LatAm oil and gas sector with greater flexibility and access to capital than a traditional investment vehicle
(1) Bloomberg; reached on 7/30/2014
2 Creation of a Leading LatAm Oil and Gas Company Next generation independent oil and gas company
Vision Acquisition strategy Growth focus Operational approach
Establish a leading publically . Flexible structure, with a Assets where management People and community traded oil and gas company preference for a stock or has actual operating Identified leading local knowledge / operational that becomes the local partner asset purchase basin specialists of choice in the region experience Experienced in complex (1) . Full or partial ownership (Mboe/d) Geographically diversified with control (preference for a stakeholder management portfolio 2,870 operating role) Asset management 2,868 Target companies/assets that Fit-for-purpose, field-specific, 723 very lean operational model . Are fundamentally sound but 579 underperforming their Dynamic portfolio management and (2) potential agile decision making
75 . Are at an inflection point, requiring management Technology 70 expertise and/or capital Partnership with service providers to expedite access 30 . Can leverage extensive to state-of-the-art-technology
26 network and insight of sponsor group 22
Broad scope for initial acquisition to maximize risk-adjusted upside and build platform for future growth
Source: Company filings. (1) Pemex figures as of 4Q16 and all other figures as of 3Q16. (2) Target position in the market. For illustrative purposes only. 3 LatAm Investment Opportunity Key drivers and differentiation factors
Vista’s Management Team differentiation Opportunity drivers Extensive network and credibility across key industry players to facilitate proprietary deal access Government opening up oil and gas sector Massive underdeveloped resource base Capital availability and quick decision Mexico Pressing need for foreign investment and new players making to increase appeal to sellers
Proven track record in successfully Macroeconomic normalization with a need to substitute executing complex transactions across the expensive energy imports region Emergence of Vaca Muerta as world-class shale play with large capital requirements Deep operating experience in key assets
Argentina and access to leading basin-specific human Existing players looking for partnerships to attract growth capital and technical best practices talent to significantly reduce execution risk
Strategic relationships with service Government reforming regulatory framework to attract providers to leverage operational footprint investments independently from Petrobras and accelerate time to market
Brazil’s Agencia Nacional do Petroleo (“ANP”) launching new Brazil bidding rounds and Petrobras pushing divestment program Reputation and expertise to attract Undercapitalized small-caps in need for capital to grow international partners as “local partner of choice” in the region
Stable regulatory framework and relatively Hands-on experience dealing with complex investor-friendly environment stakeholder management Undercapitalized companies with high quality assets can serve as regional growth platform Colombia Market recognition from prior Fragmented market with potential for roll up play to gain scale experience in managing a high profile publicly-traded company
Market structures expected to change radically over next decade with less dependence of national oil companies (“NOCs”) and emergence of new players
4 LatAm Oil and Gas – Why Now? Distinct window of opportunity for acquisitions
Positive shift in fundamentals Significant resources available for investors
Governments are increasingly embracing economic and sector-policy Valuable assets available as price cycle is pushing companies to optimize reforms to strengthen fiscal revenues and incentivize foreign investments and sell non-core assets
Competition for assets still low compared to other geographies Strong need to boost domestic gas production to balance energy matrix and replace expensive imports across key countries Domestic gas prices will be supported by the high price of imported natural gas
Oil and natural gas production(1) Proved crude oil and natural gas reserves(1) (Mboe/d) (Bnboe) Oil Natural gas 15.9 4,711 3,550 2.9 13.0 2.2
1,910 2,941
1,297 13.0 4.6 1,664 10.8 3.2 647 2.2 1,207 0.9 2.4 2.3 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Mexico Argentina Colombia Brazil
Capital, technology and talent are the key to unlocking the region’s vast resource base
Vista intends to be a channel for international capital to the region
Ability to access state-of-the-art technology through strategic partnerships with service providers
Management and Riverstone have the network, reputation and leadership to attract world-class talent from and to the region
Regional dynamics, Vista’s expertise and listed acquisition company model support the investment thesis
(1) BP Statistical Review of World Energy June 2016.
5 Investment Highlights Strong combination of capabilities and market opportunity to create value for investor
Distinct window of opportunity to acquire world-class assets in a resource rich, historically 1 under-invested region, now increasingly open to investors
Attractive actionable opportunity set known by management through its operating 2 experience in the region
Highly experienced management team with strong track record of operation and 3 value-creation working together
Premier financial sponsor with extensive and specialized track record in the energy 4 sector, leading experience in listed acquisition companies and significant presence in the region
A listed acquisition company is a well-suited vehicle to create a leading publicly-traded 5 LatAm oil and gas company
6 Management Team Solid track record working together
25 years of energy experience across five continents (integrated oil and gas and oilfield services) Miguel Galuccio Former Chairman and CEO of YPF and President of Schlumberger SPM/IPM(1) Previously Schlumberger Geomarket Manager for Mexico and Central America Chairman and CEO Prior experience with YPF International and Maxus Energy in Argentina and Southeast Asia Petroleum Engineering degree from Instituto Tecnológico de Buenos Aires
More than 15 years of international business development, consulting and investment banking experience Previously Business Development Director at YPF in Argentina Pablo Vera Pinto Former member of the board of fertilizing company Profertil (Agrium-YPF), power generation company Central Dock Sud S.A. (Enel-YPF) and gas distributor Metrogas S.A. (YPF, acquired from British Gas) Chief Financial Officer Prior experience gained at private equity group in South America with finance and operations management responsibilities as Restructuring Manager, CFO and General Manager of portfolio companies, management consulting at McKinsey & Company in Europe and investment banking at Credit Suisse in New York MBA INSEAD; Economics degree from Universidad Torcuato Di Tella
More than 20 years of E&P and oilfield services experience Previously, Interim VP E&P, Head of Drilling and Completions, Head Unconventionals at YPF Juan Garoby Former President for YPF Servicios Petroleros S.A. (YPF owned drilling contractor) Chief Operating Officer Prior experience with Baker Hughes Inc. (Brazil, Peru, Ecuador) and Schlumberger Ltd. (Europe and Africa) Petroleum Engineering degree from Instituto Tecnológico de Buenos Aires
More than 10 years of LatAm E&P strategy, portfolio management and investor relations experience Alejandro Cherñacov Previously CFO of small-cap Canada-listed E&P company Prior experience as Investor Relations Officer and ran the Upstream Project Portfolio at YPF in Argentina Investor Relations Officer Masters in Finance from Universidad Di Tella, Strategic Decision and Risk Management professional certificate from Stanford University; Economics degree from Universidad de Buenos Aires
(1) Schlumberger Production Management and Schlumberger Integrated Project Management, business segments of Schlumberger Ltd.
7 Management Team’s Track Record at YPF Mr. Galuccio led remarkable turnaround in a complex scenario
Contributed to shaping key market reforms including gas pricing incentive scheme, domestic crude pricing support, amended federal hydrocarbons law, and reversed decade-long decline in production and reserves Strategic Laid foundations for economic development of Vaca Muerta: leadership with visible – 500 wells drilled (90% of Vaca Muerta activity) impact – 47% well cost reduction down to US$8mm per horizontal well – Reached 50,000 boe/d (largest economic shale development outside North America)
Tripled share price in first 24 months
Strong Grew production by more than 100 Mboe/d to reach more than 580 Mboe/d financial and Achieved 45% EBITDA growth to reach more than US$5bn operational
performance Ramped up activity from 25 to 74 drilling rigs at peak maintaining best-in-class safety record
Achieved reserves growth of 25% to reach more than 1.2 Bnboe
Closed 20+ transactions with deal value in excess of US$4bn; including company-shaping Apache Argentina acquisition (US$800mm) and landmark shale JVs with Chevron (US$1.4bn), Petronas (US$550mm) and Dow (US$180mm) Successful BD, M&A and Raised more than US$8bn from international and local capital markets with over 30 new issuances between 2012 and 2016 (with capital yields below Argentina’s sovereign benchmark); representing 90%+ of all Argentine international issuances markets effort Stock covered by more than 20 research analysts from top tier institutions; YPF Management voted top 2 Investor Relations Team for LatAm oil and gas sector by Institutional Investor
Led complex integrated oil and gas organization with more than 20,000 direct employees Ability to attract talent Promoted and recruited best-in-class managers for key positions; implemented world-class talent management initiatives and source transactions Mr. Galuccio voted Best CEO of Argentina (PwC survey 2014) and LatAm CEO of the Year (BRAVO Latin Trade business awards 2014)
Decades of oil and gas experience in leadership roles consistently delivering remarkable results
8 Miguel Galuccio’s Track Record at Schlumberger Led high growth “company-shaping” global businesses
More than 12 years in various senior leadership positions, including President of Schlumberger IPM and SPM and Geomarket Manager for Mexico and Central America Strategic thought Under his leadership, the company conceptualized and implemented novel strategic initiatives with lasting impact leader – Led the creation of SPM, which currently is a focus growth segment for SLB globally having reached 235 mboe/d
– Led Schlumberger’s re-positioning with PEMEX, which became one of the top Schlumberger clients globally
Led IPM to become a benchmark among oil field services for operational excellence
– Executed complex projects across five continents in extremely challenging conditions (e.g. Iraq re-entry, Russia, Algeria)
Developed new business models integrating services with E&P risk-returns under SPM
Execution – Burgos, Chicontepec, Alianza and Mesozoico projects with PEMEX (more than 2,000 wells drilled over 8 years) focused and – Casabe project with Ecopetrol; tripled production in 5 years results driven – Shushufindi contract with Petroamazonas (Ecuador): operated by SPM, co-funded by E&P company Tecpetrol (Techint Group) and US private equity firm KKR; doubled production in 4 years
– Barnett shale gas project (Texas) and Bakken shale oil project (North Dakota)
– Other projects in China, Romania and Malaysia
Managed fast-growing global organization with more than 6,300 employees in 55 projects across six regions
Ability to – Pushed out-of-the-box solutions with strong bottom-line impact by motivating teams and engraining a can-do attitude attract talent in the company’s engineers and geoscientists and generate network Developed vast global network across oil and gas industry – Strong relationships with CEOs of majors, independents and NOCs
9 (2) (1) Note: the of One Sponsor: Riverstone Large FundsI Power Energyand Today risk attractive generate Founded 2000: byDavid − − − − −
Energy Midstream E&P commodity of number bringsteam Investment and offices from New in 47professionals, investment operatingYork, professionals, Houston,London,including100 More than advantages critical information flow entireaccess providesfor chainsubstantial value sect and Scale to insight energyacross into the Committed transactions across >13011approximately countriesto US$35bn energyStrong Indicates Indicates I Funds II, Energy and co Renewable Funds, Power and Energy Global Includes data of as All March
Services teamexperiencedof “lifers” , energy : One of theOneofequity privatelargest tofirms solely industry dedicated the energy : number of investments, total of number total investments, capital. committed Sector - focused track record across the entire energy value chain and capital structure andchain track across valueentirerecordenergy the focused largest global global energy largest 2017, 2017, - g adjusted returnsinvestment LPs for cycles unless otherwise indicated. Past performance is not indicative of results. future Pastis not indicative performance indicated. otherwise unless Leuschen more more than - VI, RenewableEnergyFundsI VI, 600 and Pierre years of collective experience in the energy industrycomplementary aenergywithyears collective in of experience the 61 21 Investments 23 Investments US$18,200mm Investments US$4,100mm US$6,300mm Investments Lapeyre - to partner with energy industry management teams to invest in a dynamic and growing investment opportunity set set and growingopportunity dynamic ainvestment and in investteams partnermanagement with to to industry energy II, vehiclesRiverstoneCreditrelatedII, other and Partners I) - (2) focused private equity firms equityprivate focused - investments and REL. Excludes investments from new c frominvestmentsnew REL.Excludes and investments Holdings Equipment manufacturing and maintenance, service provisionservice andmaintenance, manufacturing Equipment Infrastructure world the gasaround naturaland oil of productionand Exploration closely aligned with production versus explorationversus productionalignedwithclosely is most market target whosecompanies services manufacturinguniquedeveloped effects:cycle mitigating on Focused baseclientservicingglobal people 20,000over employing platforms manufacturingand services21 275 approximatelyrepresenting assets operatedand Owned Morgan)(Kinder date to sector Midstreamthe in LBOs largest theof one (Magellan);IPOpublic via GPs MLP first the of one took and sixMLPs Formed pipeline systems of miles 100,000 approximatelyof networka operatedand expanded Built, threevia Mexicoentered Successfully Niobrara) Plains (Bakken, Great / Rockies theand Permian), Barnett, Ford, Mid Fayetteville),Bossier, (Haynesville, Southeast Utica), (Marcellus, Northeastthe regions: gas oil / tight orshale onshoreFive” “Big includingthe basinsUS major all thein presenceActive Mexico of Gulf the andCanada, America, Northin presence includingsignificantin E&P, investorsPE energylargest the of One (1) and logistics services to the energy industryenergythe to services logistics withUS$36bnapproximately portfolio companies after the constitutional energyconstitutionalthe after companies portfolio redit platform given dynamic nature of credit of credit nature dynamicredit given platform Description blend of investing and operating expertise developed overa expertisedevelopedoperatingand investing of blend raised since raised (Globalsince across inceptionfunds private 9 or MMbbl dynamics, dynamics, competitive sustainableresulting in Mex of storage capacity storage of - Con (Mississippian, Woodford, Antrim), Texas (Eagle Texas Antrim), Woodford, (Mississippian, Con ico ico City portfolio. reform 10 Early Participation Across Mexico’s Energy Sector Riverstone has been highly involved in the country’s emerging energy opportunities
Sector Portfolio company Description of main activities
Sierra Oil & Gas has positioned itself as one of the most active and successful local players since the energy reform, having been awarded five offshore blocks to date and become the third largest non-state owned E&P company in Mexico by net acreage, with approximately 560k net acres Talos Energy partnered with Sierra and Premier Oil as operator in the winning consortium that was awarded two shallow water exploratory blocks in Round 1.1., these being the first concessions awarded since 1938. The consortium members announced in July 2017 that the first well drilled in these blocks resulted in a large oil discovery, named “Zama” E&P Fieldwood Energy partnered with PetroBal (led by the former CEO of PEMEX E&P) and was awarded a shallow water development block during Round 1.2 Sierra oil and gas participated in two other winning consortiums for two offshore exploration blocks during Round 1.4., with partners Petronas, Murphy Oil Corp. and Ophir Energy
Avant Energy is a recently created company focused on the development, construction and operation of infrastructure for the country's oil, natural gas, refined products, and electricity sectors Sierra is jointly developing an US$800mm refined products import integrated project alongside g TransCanada (operator) and Grupo TMM, which includes a marine terminal, a pipeline and inland storage and distribution hub
Midstream TrailStone is a global commodities logistics and trading company engaged across the liquids, power and gas, metals and mining, and agriculture segments that is pursuing opportunities in northern Mexico
Pattern Energy formed a JV with Cemex Energia, one of Mexico’s most important renewable power developers in Mexico, to build a portfolio of at least 1GW of renewable projects over five
years
energy Renewable
Raised one of the first Mexican energy-focused private equity funds with Ps$12,500mm commitments from Mexico’s pension funds
Riverstone CKD ‘15
Local Fundraising
11 Board of Directors comprised by World Class Professionals Strong corporate governance, with majority independent composition
Miguel Galuccio Please refer to page 7 for Mr. Galuccio’s biographical information. Chairman of the Board
Partner at Riverstone based in the New York office and responsible for business development within the firm Kenneth Ryan Prior to joining Riverstone in 2011, Mr. Ryan worked for Gleacher & Company and Gleacher Partners in London and New York, more recently as Managing Director and Co-Head Member of the of Investment Banking Board by Currently he serves as member of the investment committee at Riverstone Credit Partners and as member of the board of Riverstone Energy Limited, HES International and Trailstone Riverstone Mr. Ryan graduated from the University of Dublin Law School, Trinity College
Ms. Segal was appointed President and General Director of Americas Society / Council of the Americas in 2003, after working in the private sector in Latin America and other Susan L. Segal emerging markets throughout more than 30 years Prior to her current appointment, she was a Partner at Chase Capital Partners / JPMorgan Partners with a focus on private equity in Latin America and pioneering venture capital Independent investments in the region member of the Ms. Segal is a member of the Board of Americas Society / Council of the Americas, the Tinker Foundation, Scotiabank and Mercado Libre, as well as President of the Board of Board Scotiabank USA Ms. Segal graduated from Sarah Lawrence University and received an MBA from Columbia University in the United States
Mr. Doehner has been Executive Vice President of Corporate Affairs and Enterprise Risk Management at Cemex since May 2014 Mauricio Mr. Doehner began work with Cemex in 1996 and has held various executive positions in areas such as Strategic Planning, Institutional Relationships and Communications and Doehner Cobián Business Risk Management for Europe, Asia, Middle East, South America and Mexico Further, he worked in Mexico’s Presidential administration leading the relationship with the Mexican public, including diverse issues such as government reforms and the national Independent budget member of the Mr. Doehner holds a Bachelor’s degree in Economics from Tecnológico de Monterrey, an MBA from IESE/IPADE, and a Professional Certificate in Competitive Intelligence by the Board FULD Academy of Competitive Intelligence in Boston, Massachusetts
Mr. Lim is an advisor at GIC Private Limited, a leading global investment firm, where he previously held the position of Managing Director and President (Americas) and prior to his appointment to the United States in 2009, he was President of GIC in London for 11 years Anthony Lim Prior to joining GIC, he was General Manager in Bankers Trust Company and held various positions of high level Independent Mr. Lim currently serves as a member of the Global Advisory Board of Teach for All, an organization dedicated to global education, and is a Founding Member of the Global Advisory Board of the Woodrow Wilson Center member of the Additionally, Mr. Lim serves in the Expert Advisory Board and the Surveillance of Asset Management of External Clients Committee of the World Bank Treasury and was a Board member of the Board for Hedge Fund Standards from 2007 to 2016 Mr. Lim graduated from Singapore National University and completed the Management Program at Harvard Business School.
Mr. Bly has more than 30 years of experience in the oil and gas industry, having occupied various executive positions at an international level at BP. His last role at BP was Mark Bly Executive Vice President of Safety and Operational Risk Mr. Bly was also a part of BP’s E&P Executive Group, responsible for monitoring an international portfolio with units in Angola, Trinidad, Egypt, Algeria, and the Gulf of Mexico Independent Mr. Bly led the internal investigation of the Deepwater Horizon incident in 2010, and is the author of “Bly Report” that defined the understanding of such event by the industry and member of the represented the founding of the new organization and global drilling practices program within BP Board Mr. Bly received a Master’s degree in Structural Engineering from the University of California at Berkeley and a Bachelor’s degree in Civil Engineering from the University of California at Davis
12 Mexico’s Large Resource Base Now Open to Investors Regulatory changes are increasingly unlocking the oil and gas sector to private investment
Multiple E&P plays across basins(1) Material untapped reserves with significant upside(1) (Bnboe) Reserves Geologic Cumulative Prospective basin production 1P 3P resources Proved reserves in Southeast 46.3 8.9 18.1 14.5 these basins are similar to Tampico Misantla 7.2 0.9 6.7 37.3 Chevron’s proved (2) Burgos 2.3 0.2 0.6 14.0 reserves globally
Veracruz 0.8 0.2 0.2 2.0 Pemex with a need for Sabinas 0.1 – 0.1 14.3 investment and Others (3) – – – 3.0 access to technology
Deepw ater – 0.1 0.5 27.8 and know-how
Total Mexico 56.8 10.2 26.1 112.8 Substantial underinvested Total Pemex 56.8 9.6 22.2 25.9 resource base due to few players in Rest of – 0.6 3.9 86.9 the sector Eagle Ford shale formation. opportunities Production and development Exploration Energy sector reform is a government priority
2014 2015 October 2017 Historic constitutional energy reform enacted Farm-out Ayín-Batsil Round zero Round one in 2014 opened up the sector to private Pemex direct allocation 39 blocks awarded 3P reserves: 297MMboe Start of Pemex contract migration investment for the first time in 78 years 2 blocks consisting of 22 contracts Reform seeks to maximize oil and gas production growth and fiscal revenues to October 2017 bolster government budget June 2017 Farm-outs Ogarrio and Cárdenas-Mora Additionally, the reform aims to transform Round 2.1 3P reserves: 148MMboe December 2016 10 out of 15 shallow water Pemex into a more efficient state-owned blocks awarded Trion farm-out deal productive enterprise BHP Billiton / PEMEX: 60% / 40% 3P reserves: 485 MMboe Need to speed up implementation is becoming evident Source: Pemex Hydrocarbon Reserves of Mexico as of January 1, 2015, Pemex Newest Opportunities, Pemex Investor Presentation February 1, 2017 and Plan Quinquenal de Licitaciones para la Exploración y Extracción de Hidrocarburos 2015-2019, 2017. (1) Secretaría de Energía (“SENER”), EIA and Comisión Nacional de Hidrocarburos (“CNH”). (2) Chevron 2016 Annual Report. (3) Includes Plataforma de Yucatán and Cinturón Plegado de Chiapas. 13 Mexico Onshore Oilfields Opportunity Significant potential to increase recovery factors
Typical oilfield life cycle(1)
Daily production A typical field life cycle has three phases: production growth, plateau and Peak Plateau production decline
Optimizing the decline phase requires an in depth understanding of the different recovery mechanisms involved Decline C A.A Production Optimization
B B.B Secondary Recovery
A C.C Enhanced Oil or Tertiary Recovery (EOR)
5 years 10 years Time Large oil volumes still to be recovered through secondary and tertiary recovery across basins
70% There is significant potential for reserves
Worldwide Worldwide reference indicative increase through improvement in recovery 60% factors 50% A 1 percentage point increase in recovery 40% factor is a volume of ~1.6 Bnbbl (equivalent to more than 2 years of total oil 30% production of Mexico)
20% Recovery Recovery factors 10%
0% Current MX Onshore (2) Aggressive Best in class Aggressive Best in class + performance performance + EOR advanced EOR
(3) (3) (3) Optimized Primary recovery Secondary recovery Tertiary recovery
Management experience in oilfield rejuvenation is particularly applicable to Mexico onshore opportunities
(1) Diagram is provided for illustrative purposes only. (2) Calculations based on data from Comisión Nacional de Hidrocarburos (Volumen original, reservas y producción acumulada de hidrocarburos al 1ro. de enero de 2016). (3) Asociación Regional de Empresas del Sector Petróleo, Gas y Biocombustibles en Latinoamérica y el Caribe. 14 Mexico Presents Several Actionable Opportunities Multiple paths to take advantage of the recent opening of the sector
1 Farm-outs: material opportunities to partner with Pemex(1) 2 Migration from service to E&P contracts(3) Critical element in Pemex growth strategy to attract investment and expertise, Different risk-return profile and higher capital requirements positions Vista as a strong potential partner should open up opportunities for acquisitions Cumulative Reserves 2015 Oil Gas Area Capex Project production MMboe production production Mision km2 US$bn MMboe 1P 2P 3P (Mbbl/d)(2) (MMcf/d) (2) Santuario, Magallanes and Arenque
Shallow block Panuco Water Ayatsil-Tekel-Utsil 142 0 403 750 855 8.3 5 1 Heavy oil Ebano and Miquetla Samaria, Ogarrio, Mature Cárdenas-Mora, 461 557 600 691 728 1.9 71 100 Altamira
Onshore migration Rodador
st Olmos 1 Shallow Bolontikú-Sinán 217 631 338 770 842 4.5 75 100 Nejo Water Ek-Balam Tierra Blanca, San Andres
Shallow Amatitlán Ayin-Batsil(8) 1,096 0 46 123 297 NA 0 0
Water Miahuapan block Deep Pitepec Water Kunah - Piklis 89 0 0 296 410 6.1 0 0 Gas Humapa Deep Soledad Maximino
Water 131 0 0 0 1,007 19.3 0 0 migration Trión-Exploratus Cuervito, Fronterizo
Oil nd
2 Pirineo (4) 3 Upcoming CNH bidding rounds Monclova Carrizo Significant growth potential from future bidding rounds 4 Bidding rounds awarded blocks 3 69 onshore and shallow water blocks, with over 12,276 MMboe of prospective resources
1 39 blocks awarded
and2 1 1 4 55 onshore blocks, with over 7,620 MMboe of prospective
resources 2 31 blocks awarded
Roundand4 3 Round
(1) PEMEX Investor Day New York presentation. (2) August 2015. (3) Pemex presentation “Mexico: Newest Opportunities & Opening the Gulf of Mexico”. (4) Plan Quinquenal de Licitaciones para la Exploración y Extracción de Hidrocarburos 2015-2019. (5) SENER convocatoria July 2016. (6) SENER convocatoria August 2016. 15 (7) SENER convocatoria November 2016. (8) CNH and SENER. Argentina’s Vaca Muerta Shale Formation A significant investment opportunity comparable in scale and quality to US shale basins
Vaca Muerta formation(1) Vaca Muerta characteristics(2) Vaca Muerta Wolfcamp Eagle Ford (Permian) Gross Area* (acres) ~9,724,000 ~8,617,000 ~13,390,000 Mendoza
Argentina Light Oil Avg. total organic content (%) 2.55 5.5 4.5
Black Oil Avg. Net Thickness (meters) 30 - 450 172 41 Wet Gas Neuquén Dry Gas Neuquén Wet Avg. Pressure Gradient (psi/ft) 0,82 0,48 0,96 Gas 2016 production (Mboe/d) 52 1,130 1,624 * Gross Area may include non prospective acreage 2014 Amended Hydrocarbon’s Law provides competitive shale specific fiscal terms (35 year concession term with 12% flat royalties)
Argentina is ranked globally in shale potential(3) #4 in shale oil #2 in shale gas (Bnbbl) (Tcf)
75 1,115
58 802 665 573 32 27
Rusia USA China Argentina China Argentina USA Canada
(1) Wood Mackenzie. (2) Wood Mackenzie. (3) Technically recoverable resources, EIA shale report. 16 Vaca Muerta Progress to Date Play has been substantially de-risked over the last four years
Switch to drilling horizontal wells was key to success(1) Gross shale O&G production(2) (Number of wells) (Mboe/d) More than 700 wells drilled to date 65.8 62.1 185 160 148 48.9 119 40.9
59
16 4.0 4 0.2
2010 2011 2012 2013 2014 2015 2016 Dec' 12 Dec' 13 Dec' 14 Dec' 15 Dec' 16 May' 17 Vertical Horizontal
Loma Campana horizontal wells cost(3) Vaca Muerta achieving US top basin productivity(4)
(In US$mm) (EUR (boe / ft lateral length)) Vaca Muerta Wolfcamp Eagle Ford Only sub-plays with 5-25% of gas content 13.7 Approx. Vaca Muerta oil window -40% 145 EUR (boe / foot of lateral) 125 110 104 8.2 94 85 84 78 47
2015 2016
Fairway
Southern
Platform
BlackOil
2012 2016
Northeast
Extension
Carbonate
DeepBasin
2013-2015
NortheastOil
VMwindow oil VMwindow oil VMwindow oil
(1) Argentine Ministerio de Energía. (2) Argentine Ministerio de Energía, shale oil and gas producing concessions (Loma Campana, El Orejano, La Amarga Chica). (3) YPF’s 2016 20F (4) Wood Mackenzie Vaca Muerta Development Study. 17 Vaca Muerta at an Inflection Point Time to invest
Development competitive at current oil prices(1) Acquisition cost is a fraction of US comparable(2) (In US$) (Average adjusted US$/net acre) Further efficiency gains being implemented with Attractive entry costs are still attainable in Vaca Muerta support from government and unions $39.0/boe $36.1/boe $3.1/mcf $27,779 $26,288 $25,075
$16,581
$6,633 $3,477 $3,277 $1,650
Oil Gas Condensate 2014 2015 2016 2017 Permian Vaca Muerta
Replacement of expensive energy imports(3) Operated and non-operated concessions in Vaca Muerta
3 (Number of concessions) (MMm /d) LNG import parity supports high domestic gas pricing Sizeable concession areas provide materiality for opportunities (currently at 5.0-7.5 US$/MMbtu) 26 160
140 11 120 10 8 100 6 6 5 5 5 4 15 5 3 80 2 1 1 3 2 1 6 2 3 1 5 3 4 3 4 3 2 60 2 1 –1 –1 2008 2009 2010 2011 2012 2013 2014 2015 2016
Production Imports Non operated Operated Total
Significant upside still achievable from longer horizontal wells/more fracs following US trend
(1) Wood Mackenzie. (2) Public filings and press releases. Permian adjusted for production value at $35,000 / boe/d. Vaca Muerta in 2017 YPF deals with Shell and Schlumberger. (3) Argentine Ministerio de Energía, Enargas and Enarsa. (4) Wood Mackenzie; Selected private VM acreage holders, does not include GyP of Neuquén. Data as of March 31, 2017. Reflects concesions and explorations permits that include acreage covered by the Vaca Muerta formation, may include acreage that is commercially unviable. 18 Colombian Market Highlights and Opportunities Attractive prospects for a well-capitalized player
(2) Highlights 1 Acquisition of an existing operating company 75 2015 average net production (Mboe/d) Investor friendly sector with appealing fiscal terms Public Private companies(3) Positive reputation for respecting contract sanctity companies 45 Energy sector reforms initiated in 2003 have made the country an 41 attractive investment destination for private players 26 22 21 21 18 14 13 8 8 4 3 1 1 Gas supply shortfall may boost profitable gas activity Increasing demand is encouraging investment in gas exploitation Gas prices were deregulated in 2014, supporting development activity 2 Asset purchases from established operators
Operators are actively optimizing their portfolios to concentrate on priority Activity and production dropped sharply with oil price decline production assets and projects (1) The country has seen investment cuts of nearly 60% since 2015 A number of assets may become available for purchase as operators Sheer quantity of smaller-sized discoveries made between 2006 and execute their divestment strategies 2015(2) Unconventional oil and gas plays are under-developed, presenting opportunities for new entrants Ecopetrol’s bidding processes(4) Various investment opportunities are available 3
Possible targets among stable companies that have been in operation In 2016, Ecopetrol initiated a public bid process to award 17 production for several years assets Large oil and gas companies looking to reshuffle their portfolio by Total opportunity size of approximately 1,594 MMboe of original oil in place selling their subsidiaries Ecopetrol is bidding out production assets − In November 2016, 6 projects representing a total of 640 MMboe were awarded: Iberoamericana (3 projects), Gran Tierra (2 projects) and Parex Companies with mature assets that require the necessary expertise in Resources (1 project) recovery techniques to create operational value 11 production assets with approximately 954 MMboe not yet awarded Colombian companies that do not have capital and/or an experienced management team are prime targets and can serve as a platform for regional growth
(1) Colombia’s Asociación Colombiana del Petróleo (“ACP”). (2) Wood Mackenzie. (3) Ownerships: Equion is owned by Ecopetrol (51.0%) and Repsol (49.0%), Mansarovar is owned by Sinopec (50.0%) and ONGC (50.0%), Hocol is owned by Ecopetrol (100%), CEPSA is owned by IPIC (100%), Perenco is owned by the Perrodo family, Petrosantander is owned by Metalmark Capital, Pluspetrol is owned by the Poli and Rey families and Nexen is owned by CNOOC (100%). (4) Ecopetrol. 19 Brazilian Market Highlights and Actionable Opportunities Significant resources in a sector open to private investment
(3) Highlights 1 Acquisition of an existing operating company 2015 average net production (Mboe/d) Government taking steps to improve the attractiveness of 43 * Denotes public companies Brazil’s oil and gas sector 38
Recent change to the pre-salt law, where Petrobras is no longer obliged to have a minimum 30% stake and be the operator. 19 19 New local content adjustment is a positive structural change that 16 significantly improves Brazil's oil and gas sector competitiveness. 13
4 Implemented new fuels pricing formula linked to changes in 3 3 1 1 – – – international prices and the Real’s appreciation/depreciation * * * * * * * Petrobras already directly negotiating farm-outs with IOCs
New “REATE” program reduces royalties for onshore developments to incentivize onshore production targeting 500,000 Boe/d in 2030 (doubling current onshore production)(1) 2 ANP licensing rounds
Three rounds expected for 2017: (2) Material untapped 3P reserves − Marginal fields round (Bnboe) 24.5 − Round for unlicensed areas containing extensions of discoveries in existing blocks − Exploration licensing round 4.9 Oil Gas 3 Petrobras divestment plan
As part of its 2017-2021 Business Plan, Petrobras is offering a variety of areas as part of a US$19.5bn divestment program for the 2017-18 period(4) Petrobras’ divestment plan is key to mobilizing the industry The upstream program includes mature onshore and shallow water fields, Divestment plan expected to facilitate access to production fields greenfield development projects and non-core producing assets
(1) Government of Brazil (http://www.brasil.gov.br/infraestrutura/2017/01/programa-de-incentivo-a-exploracao-e-producao-de-petroleo-e-gas-em-terra-e-lancado-nesta-sexta-27). (2) Brazil’s Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (“ANP”). (3) Wood Mackenzie. (4) Petrobras’ “Strategic Plan and Business and Management Plan 2017-2021”. 20 A Listed Acquisition Company is Well-suited to Execute Vista’s Business Plan
Publicly listed acquisition company Operating business / asset (shell company with cash in trust)
Strong management team and sponsor with a successful IPO candidate ‘in its own right,’ seeking a fast-track IPO track record, proprietary sourcing network, credible investment and upside potential through partnership with the listed thesis and operating expertise acquisition company
Entity merges into listed acquisition company creating a publicly listed operating company / asset
Advantages for investors Advantages for sellers Downside protection through reimbursement rights through funds Opportunity to participate in Vista’s long-term vision via an held in escrow account equity position in combined entity Public market liquidity with features similar to a private Accelerated IPO execution with less disruption to equity investment ongoing operations Required liquidation of escrow account if no acquisition completed Access to public markets for currency and growth within required time period Reputational benefit through partnership with a premier sponsor / Alignment with management objectives through common management team equity-based sponsor investment structure Flexibility in designing post-transaction structure No management fees associated with investment
Advantages for Vista’s business plan execution
Ability to deliver immediate liquidity to sellers while offering an opportunity to participate in a longer-term vehicle via a potentially liquid security
Cash in escrow provides the ability to act quickly and invest opportunistically, even in shallow domestic capital markets
Inherent structural flexibility is well-suited for building a platform for future acquisitions
Attractive solution for sellers and investors increases appeal by providing a natural exit strategy
21 Silver Run—Centennial One of the best performing US listed acquisition companies in history(1)
Transaction summary Investment highlights
One of the first energy dedicated listed acquisition companies pairing 1 Filed US$450mm Silver Run IPO on January 27, 2016 a world class operational focused CEO with a top tier industry focused sponsor Launched the Silver Run IPO in February 2016 despite oil 2 Experienced team with a strong record of value creation led by Mark trading below US$27 per barrel Papa, prior CEO of EOG from 1999 – 2013
3 Successfully upsized to US$500mm Premier sponsor with a leading track record in the energy sector Opportune time to take advantage of current dislocation in the Only 5 months later, Silver Run announced the acquisition of energy markets 4 Centennial for US$1.7bn Extensive deal sourcing network with global reach through Riverstone 5 Today, Centennial has a market cap of US$3.6bn Ability to act quickly on high quality, under-capitalized energy assets
SRAQ/CDEV performance since IPO
Silver Run Closes 150% Centennial Closes Centennial Acquisition Silverback Acquisition 125% (Oct 11) Silver Run to current Centennial (Dec 29) (2) 100% Silver Run Announces +58% since IPO market capitalization Centennial Acquisition 75% (July 22) 50% Silver Run Completes $500 million IPO 25% (February 23) Centennial Announces Silverback Acquisition $500mm 0% listed $3.6bn Centennial (Nov 28) Silver Run Files $450 million IPO acquisition (25%) company (January 27)
(50%)
Jul-16
Jan-16 Jan-17
Jun-16 Jun-17
Apr-16 Apr-17
Oct-16
Feb-16 Feb-17
Mar-16 Mar-17
Nov-16
Aug-16 Sep-16 Dec-16
May-16 May-17
Source: FactSet, Bloomberg. Market data as of 6/30/2017. (1) Includes listed acquisition companies >$200m. (2) Includes two non-dilutive PIPE transactions; 226.4 million shares outstanding as of 6/30/2017 22 Investment Highlights Strong combination of capabilities and market opportunity to create value for investor
Distinct window of opportunity to acquire world-class 1 assets in a resource rich, historically under-invested region, now increasingly open to investors
Attractive actionable opportunity set known by 2 management through its operating experience in the region
Highly experienced management team with strong track 3 record of operation and value-creation working together
Premier financial sponsor with extensive and specialized track record in the energy sector, leading experience in 4 listed acquisition companies and significant presence in the region
A listed acquisition company is a well-suited 5 vehicle to create a leading publicly-traded LatAm oil and gas company
23 Appendix Illustrative SPAC Structure Diagram
Sponsor Promote and Independent Director Shares (20% of Shares Outstanding) Sponsor and SPAC Investors Management Team
Unit (1 Common Share + 1 Warrant) Warrants USD Price (or Cash to fund Equivalent in Offering MXN) Expenses and SPAC Working Capital
Escrow Account Operating Account Funds in USD Working Capital
SPAC raises capital by selling Units (1 Common Share + 1 Warrant) to local and international investors.
Capital raised is held in a USD-denominated escrow account and invested in short-term government securities.
The SPAC has 24 months to complete a business combination (unless the SPAC stockholders elect to extend the time frame), but if one does not occur, then the SPAC will liquidate and return each shareholder their pro rata amount in the escrow account net of certain expenses.
Upon announcement of a business combination, shareholders will have time to evaluate the transaction. After evaluating, investors may sell in the open market, buy more shares in the open market, or receive reimbursement for their shares at the closing of the business combination for their pro rata amount in the escrow account.
25 SPAC Business Combination Process
A publicly listed SPAC is an acquisition vehicle whereby a sponsor team raises a blind pool of cash in an IPO to acquire a private operating business or asset, or, in certain instances, a public company seeking to de‐lever, through a reverse merger
Once the blind pool is raised in the initial IPO, the sponsor team has 24 months to identify an acquisition target that must be approved by a majority of SPAC shareholders (unless the SPAC stockholders elect to extend the time frame), at which point the SPAC merges with the target in a reverse merger and the acquisition target (if not already a public company) becomes a public operating company
1 IPO 4 Typical Shareholder Vote Process
100% of IPO gross proceeds held in escrow account until acquisition completed 5 Acquisition NOT approved 5 Acquisition IS approved Cash‐in‐escrow invested in short‐term government securities such as US Treasuries Proposed transaction rejected if we do not Simple majority of public investors in receive approval from a simple majority of the listed SPAC vote “yes” SPAC public investors
2 Acquisition announced SPAC may look for another target, time Management puts out an announcement of permitting, proposed acquisition otherwise it faces liquidation Company and seller prepare proxy materials for shareholder and regulatory approval
6 Escrow liquidation 6 Acquisition completed
3 Deal roadshow Escrow liquidated and all funds returned Target business or asset becomes a to public shareholders pro rata public operating company Management team and the seller meet investors to discuss investment case Sponsor does not have right to liquidation No shareholder is forced to be proceeds over funds held in the escrow dragged along and each shareholder Deal is marketed to current shareholders, account has the right to have their shares new investors and sector specialists reimbursed and canceled for a pro rata portion of cash‐in‐escrow
26