Annual General Meeting · Rumba Field Capachos-2 Great country to build a profitable business. ......


HOW PAREX MANAGEMENT THINKS ABOUT OUR BUSINESS

1. Focus on consistent per share returns

2. Maintain a pristine balance sheet

3. Access under-explored proven oil-prone basins

4. Perform industry leading technical work

5. Be a hands-on Management Team – deliver on promises

6. Take appropriate risks

Don’t do anything stupid!


WHY ARE WE COLOMBIA FOCUSED?

• Abundant Resources

• Good Fiscal Regime

• Stable Politics

• Access To Tidewater

• Leverage our expertiseoTechnical

oOperational

oSocial

Rumba Field Capachos-2

Great country tobuild a profitable business


COLOMBIA HAS LOTS OF OIL-PRONE BASINS TO ACCESS

• Oil production ~850,000 bopdRank #2 LATAM onshore

• USGS conventional onshore oil assessed potential=o 15 billion bbls discovered-to-date

o 5.6 billion bbls undiscovered potential Ranks #2 LATAM onshore

• Our exploration focus:o Llanos and Magdalena basins

Major Producing BasinsExplored Portions

Colombian Sedimentary Basins

Llanos

Putumayo

UpperMag

MiddleMag

LowerMag

9.23.5

Legend (billion bbls)DiscoveredYet-to-Find

0.60.3

1.10.4

3.30.5

0.80.9

Significant remaining potential

Sources: USGS & IHS – May 2018


LIGHT & MEDIUM OIL RESOURCE PYRAMID (ONSHORE)

Poor

Good Immature

Mature

Colombia basins are similar to theWCSB 30 years ago

Conventional- Primary recovery, natural drive

- Secondary recovery, waterfloods

Tight OilVertical & Horizontal stimulations

Unconventional Horizontal multi-fracs


UNDEREXPLORED FOR CONVENTIONAL PLAYS

• Limited exploratory drilling Y-O-Y

• Above ground issues have historically limited exploration activities

• “Old” technology application o 3D seismic

o Directional drilling

• Basins are still yielding large discoveries(>20MMBOE)

o 29 discoveries since 2000

CostayacoQuifa

Tigana

Jacana

Tua

Acordionero

There’s more to find!0

1

2

3

4

5

6

0

20

40

60

80

100

120

140

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

Nu

mb

er

of

Dis

cove

rie

s >

20

MM

BO

E

Nu

mb

er

of

Exp

lora

tio

n W

ells

Exploration Drilling in Colombia

Annual Exploration Drills

Discoveries > 20 MMBO

CostayacoQuifa

Tigana

Jacana

Tua

Acordionero


• Gross production

• LLA-32, LLA-34 & Cabrestero net reserves last 5 years

0

50

100

150

200

250

2012 2013 2014 2015 2016 2017

RES

ERV

ES (

MM

BO

E)

1P 2P 3P

0

10

20

30

40

50

60

70

2012 2013 2014 2015 2016 2017 Q1 2018

MB

OE/

DSOUTHERN CASANARE – FOUNDATION FOR FUTURE GROWTH

As per the independent reserve report prepared by GLJ Petroleum Consultants Ltd. effective Dec. 31/17

LLA-32

LLA-34Chachalaca

Tilo

Tigana

Jacana

Akira

Tua

Tarotaro

Aruco

Kananaskis

Calona

Chiricoca

Herradura

Bacano

Curucucu

Jacamar

Cabrestero

3-5 years of production growth Faults GLJ 3P (2017YE) Exploration

Max


TIGHT OIL – NEXT GROWTH AREA?

Size of the Provincia Sub Basin

WCSB Unconventional& Tight Oil Plays

Provincia Sub-Basin

Existing oil wells

PXT appraisal

Coyote 1/2/3

Aguas Blancas

De Mares Block

Potentially material plays for Parex


COLOMBIA FISCAL REGIME

• Simple tax/royalty system

• Royalties fixed inside block contracts-law, never been changed

• Corporate tax rate declining

• Revenue paid offshore

• No currency controls

Attractive and stable terms

$0

$2

$4

$6

$8

$10

$12

VII

OB

E

KEL

BN

E

VET

PG

F

YGR

TVE

RR

X

SGY

PX

T

WC

P

CP

G CJ

SPE

TOG

ERF

BTE

GTE

Royalties (Q4/17, $/Boe)

0%

5%

10%

15%

20%

25%

30%

VII

OB

E

BN

E

VET KEL

RR

X

YGR

TVE

PG

F

PX

T

SGY

CP

G

WC

P CJ

SPE

GTE

TOG

BTE

ERF

Royalties (Q4/17, % of Revenue)

Source: Another Year In The Trenches, But Green Shoots Emerging - April 18, 2018, CIBC World Markets Inc.


VALUABLE OIL: PREMIUM PRICING & CASH NETBACKS

• Brent referenced pricing

• Parex 21o API blend has discount of $4.56/bbl (Q4 2017)

• Multiple egress routesoPipelines – under-utilized

oTrucking

oBargingSurplus take-away capacity

$25

$35

$45

$55

$65

$75

$85

PG

F

BTE

FRU

SGY

PSK C

J

OB

E

GTE

RR

X

WC

P

SPE

CP

G

TVE

TOG

KEL

BN

E

ERF

VII

YGR

PX

T

VET

Realized Oil Price (Q4/17, $/Bbl)

$5

$10

$15

$20

$25

$30

$35

$40

$45

PG

F

OB

E

KEL C

J

BTE V

II

SGY

BN

E

ERF

WC

P

VET

TVE

GTE

YGR

TOG

CP

G

SPE

PX

T

RR

X

Cash Netback (Q4/17, $/Boe)

Source: Another Year In The Trenches, But Green Shoots Emerging - April 18, 2018, CIBC World Markets Inc.

Conventional oil + world price +good fiscal terms = profitability


IMPROVING LANDSCAPE - POLITICAL UPDATE

• OECD accession process underway

• Peace Negotiations - ongoingo Peace reduces above-ground risks

oOpens up more accessible acreage

• Congressional Elections (March 11)o Generally strong pro-business mandate

• Presidential electiono Round 1 - May 27

o Round 2 – June 17 Leading candidate is Iván Duque, 41,

leader of the right-wing political party Centro Democrático

Election trending towards pro-industry candidate


23 CONSECUTIVE QUARTERS OF CONSISTENT GROWTH

-

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

-

0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

0.45

Jun

-12

Sep

-12

Dec

-12

Mar

-13

Jun

-13

Sep

-13

Dec

-13

Mar

-14

Jun

-14

Sep

-14

Dec

-14

Mar

-15

Jun

-15

Sep

-15

Dec

-15

Mar

-16

Jun

-16

Sep

-16

Dec

-16

Mar

-17

Jun

-17

Sep

-17

Dec

-17

Mar

-18

Jun

-18

PR

OD

UC

TIO

N (

BO

E/D

)

BO

E P

ER T

HO

USA

ND

SH

AR

ES Production Debt Adjusted Production Per Share

20

18

E

Our growth is the result of resources, execution & jurisdiction


-

50

100

150

200

250

300

2013 2014 2015 2016 2017

DA

PS

(BO

E/M

M B

ASI

C S

HA

RES

)

Production Per Share (Debt Adjusted)

-

200

400

600

800

1,000

1,200

2013 2014 2015 2016 2017

2P

RES

ERV

ES

(MB

OE/

MM

BA

SIC

SH

AR

ES)

2P Reserves (Debt Adjusted)

MANAGEMENT FOCUS IS ON GROWING SHAREHOLDER VALUE

15% 15%

34%

66%

7%15%

-16%-25%

40%

-11%

-30%

-15%

0%

15%

30%

45%

60%

75%

2013 2014 2015 2016 2017

TOTA

L R

ETU

RN

PXT vs. S&P/TSX Energy Index (TTEN))

PXT S&P/TSX Energy Index

Source: Scotiabank, The Valuation Book, 2018

PXT is ticking all the boxes

Top Metrics for Total Return – PXT 2017 Results

1. D/CF: Zero Debt, WC Surplus US$163mm2. Recycle Ratio: 3 year average 2P = 5x3. ROACE: 2017 = 20%4. CFPS Growth = 91%5. Production per Share (debt adjusted) = 15%


20% Production

growth DAPS

Big “E” –VIM-1 &

Capachos

Tight oil: Aguas

Blancas & De Mares

Deliver top quartile

per share growth

Surpass 50,000 bopd

Replenish & diversify portfolio

2018 2019 - 2021

WHERE DO WE GO FROM HERE?

Our focus is on profitable future growth


HOW WE OPERATE: VIM-1 PROJECT, APURE-3 DRILLING

We’re from Parex

and we arehere to help!Seriously…


THANK YOU FOR YOUR SUPPORT

On behalf of our Board of Directors

and the team at Parex, we thank all

our stakeholders for their continued

support.

Investor RelationsContact us:Mike KruchtenVP, Capital Markets & Corporate PlanningTel: +1 (403) 517-1733

Mike is the good looking guywho will now answer any questions!


ADVISORIES HOW TO REACH USThis presentation is provided for informational purposes only as of May 9, 2018 is not complete, andmay not contain certain material information about Parex Resources Inc. ("Parex" or the "Company"),including important disclosures and risk factors associated with an investment in Parex. Thispresentation does not take into account the particular investment objectives or financial circumstancesof any specific person who may receive it and does not constitute an offer to sell or a solicitation of anoffer to buy any security in Canada, the United States or any other jurisdiction. The contents of thispresentation have not been approved or disapproved by any securities commission or regulatoryauthority in Canada, the United Sates or any other jurisdiction, and Parex expressly disclaims any duty onParex to make disclosure or any filings with any securities commission or regulatory authority, beyondthat imposed by applicable laws.

Forward-Looking Statements and FOFI

Certain information regarding Parex set forth in this document contains forward-looking statements thatinvolve substantial known and unknown risks and uncertainties. The use of any of the words "plan","expect", “prospective”, "project", "intend", "believe", "should", "anticipate", "estimate" or other similarwords, or statements that certain events or conditions "may" or "will" occur are intended to identifyforward-looking statements. Such statements represent Parex' internal projections, estimates or beliefsconcerning, among other things, future growth, results of operations, production, future capital andother expenditures (including the amount, nature and sources of funding thereof), plans for and resultsof drilling activity, business prospects and opportunities. These statements are only predictions andactual events or results may differ materially. Although the Company’s management believes that theexpectations reflected in the forward-looking statements are reasonable, it cannot guarantee futureresults, levels of activity, performance or achievement since such expectations are inherently subject tosignificant business, economic, competitive, political and social uncertainties and contingencies. Manyfactors could cause Parex' actual results to differ materially from those expressed or implied in anyforward-looking statements made by, or on behalf of, Parex.

In particular, forward-looking statements contained in this document include, but are not limited to,statements with respect to the Company's vision, strategy, focus and values; benefits associated withoperating in Colombia; the discovered-to-date and undiscovered potential of assessed conventionalonshore oil in the Colombia sedimentary basins; the Company's expectation that the Colombiasedimentary basins are similar to the Western Canadian Sedimentary Basin 30 years ago; the 3-5 years ofproduction growth in Southern Casanare;

PAREX RESOURCES INC.

2700 Eighth Avenue Place, West Tower

585 8th Avenue SW Calgary

AB T2P 1G1 Canada

Tel: 403-265-4800

Fax: 403-265-8216

Email: [email protected]

Website: www.parexresources.com

MIKE KRUCHTEN

Vice President, Capital Markets & Corporate Planning


ADVISORIESthe attractiveness of Colombia's fiscal regime; expectations regarding the political landscape in Colombia and the potential benefits associated with the 2018 Colombian presidential election; and theCompany's future plans for its business, including production growth and operational plans in 2018 and its production growth, per share growth and plans with respect to portfolio diversification in 2019through to 2021.

Statements relating to "reserves" are forward-looking statements, as they involve the implied assessment, based on estimates and assumptions that the reserves and resources described exist in thequantities predicted or estimated and can be profitably produced in the future.

• These forward-looking statements are subject to numerous risks and uncertainties, including but not limited to, the impact of general economic conditions in Canada and Colombia; industry conditionsincluding changes in laws and regulations including adoption of new environmental laws and regulations, and changes in how they are interpreted and enforced, in Canada and Colombia; competition; lack ofavailability of qualified personnel; the results of exploration and development drilling and related activities; risks related to obtaining required approvals of regulatory authorities, in Canada and Colombia andpartner and community approvals in Colombia; risks associated with negotiating with foreign governments as well as country risk associated with conducting international activities; volatility in market pricesfor oil; fluctuations in foreign exchange or interest rates; environmental risks; changes in income tax laws, tax rates and/or incentive programs relating to the oil industry; changes to pipeline capacity; ability toaccess sufficient capital from internal and external sources; failure of counterparties to perform under the terms of their contracts; and other factors, many of which are beyond the control of the Company.Readers are cautioned that the foregoing list of factors is not exhaustive. Additional information on these and other factors that could effect Parex' operations and financial results are included in reports onfile with Canadian securities regulatory authorities and may be accessed through the SEDAR website (www.sedar.com).

• Although the forward-looking statements contained in this document are based upon assumptions which management believes to be reasonable, the Company cannot assure investors that actual results willbe consistent with these forward-looking statements. With respect to forward-looking statements contained in this document, Parex has made assumptions regarding, among other things: current commodityprices and royalty regimes; outcomes of the 2018 Columbian presidential election; availability of skilled labour; timing and amount of capital expenditures; future exchange rates; the price of oil, including theanticipated Brent oil price; the impact of increasing competition; conditions in general economic and financial markets; availability of drilling and related equipment; effects of regulation by governmentalagencies; receipt of partner, regulatory and community approvals; royalty rates; future operating costs; effects of regulation by governmental agencies; uninterrupted access to areas of Parex' operations andinfrastructure; recoverability of reserves and future production rates; timing of drilling and completion of wells; on-stream timing of production from successful exploration wells; operational performance ofnon-operated producing fields; pipeline capacity; that Parex will have sufficient cash flow, debt or equity sources or other financial resources required to fund its capital and operating expenditures andrequirements as needed; that Parex' conduct and results of operations will be consistent with its expectations; that Parex will have the ability to develop it's oil and gas properties in the manner currentlycontemplated; current or, where applicable, proposed industry conditions, laws and regulations will continue in effect or as anticipated as described herein; that the estimates of Parex' reserves volumes andthe assumptions related thereto (including commodity prices and development costs) are accurate in all material respects; that Parex will be able to obtain contract extensions or fulfill the contractualobligations required to retain its rights to explore, develop and exploit any of its undeveloped properties; and other matters.

• Management has included the above summary of assumptions and risks related to forward-looking information provided in this document in order to provide shareholders with a more complete perspectiveon Parex' current and future operations and such information may not be appropriate for other purposes. Parex' actual results, performance or achievement could differ materially from those expressed in, orimplied by, these forward-looking statements and, 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, whatbenefits Parex will derive. These forward-looking statements are made as of the date of this document and Parex disclaims any intent or obligation to update publicly any forward-looking statements, whether


ADVISORIESas a result of new information, future events or results or otherwise, other than as required by applicable securities laws. The forward-looking statements contained in this presentation are expressly qualifiedby this cautionary statement.

Oil and Gas Information

• The estimates of Parex' December 31, 2017 reserves set forth in this presentation have been prepared by GLJ Petroleum Consultants Ltd. ("GLJ") as of December 31, 2017 with a preparation date of February2, 2018 (the "GLJ 2017 Report") in accordance with National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities ("NI 51-101") and the Canadian Oil and Gas Evaluations Handbook (the"COGEH") and using GLJ's forecast prices and costs as at January 1, 2018. The estimates of Parex' December 31, 2016 reserves set forth in this presentation have been prepared by GLJ as of December 31, 2016with a preparation date of February 6, 2017 in accordance with NI 51-101 and the COGEH and using GLJ's forecast prices and costs as at January 1, 2017. The estimates of Parex' December 31, 2015 reservesset forth in this presentation have been prepared by GLJ as of December 31, 2015 with a preparation date of February 5, 2016 in accordance with NI 51-101 and the COGEH and using GLJ's forecast prices andcosts as at January 1, 2016. The estimates of Parex' December 31, 2014 reserves set forth in this presentation have been prepared by GLJ as of December 31, 2014 with a preparation date of February 13, 2015in accordance with NI 51-101 and the COGEH and using GLJ's forecast prices and costs as at January 1, 2015. The estimates of Parex' December 31, 2013 reserves set forth in this presentation have beenprepared by GLJ as of December 31, 2013 with a preparation date of February 20, 2014 in accordance with NI 51-101 and the COGEH and using GLJ's forecast prices and costs as at January 1, 2014. Theestimates of Parex' December 31, 2012 reserves set forth in this presentation have been prepared by GLJ as of December 31, 2012 with a preparation date of February 28, 2013 in accordance with NI 51-101and the COGEH and using GLJ's forecast prices and costs as at January 1, 2013.

• "Proved" or "1P" reserves are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely that the actual remaining quantities recovered will exceed the estimated provedreserves. "Probable" reserves are those additional reserves that are less certain to be recovered than proved reserves. It is equally likely that the actual remaining quantities recovered will be greater or lessthan the sum of the estimated proved plus probable reserves ("2P" reserves). "Possible" reserves are those additional reserves that are less certain to be recovered than probable reserves. There is a 10percent probability that the quantities actually recovered will equal or exceed the sum of proved plus probable plus possible reserves ("3P" reserves).

• This presentation contains certain oil and gas metrics, including cash netbacks and recycle ratios, which do not have standardized meanings or standard methods of calculation and therefore such measuresmay not be comparable to similar measures used by other companies and should not be used to make comparisons. Such metrics have been included herein to provide readers with additional measures toevaluate the Company's performance; however, such measures are not reliable indicators of the future performance of the Company and future performance may not compare to the performance in previousperiods and therefore such metrics should not be unduly relied upon. Management uses these oil and gas metrics for its own performance measurements and to provide investors with measures to comparethe Company's operations over time.

• Readers are cautioned that the information provided by these metrics, or that can be derived from the metrics presented herein, should not be relied upon for investment or other purposes. A summary of thecalculations of such metrics are as follows:

o Recycle ratio is calculated as cash netback per boe (or Funds Flow From Operations per boe) divided by F&D or FD&A, as applicable.o Cash netback per boe (or Funds Flow From Operations netback per boe) is calculated as Funds Flow From Operations divided by production for the period.o FD&A costs represent the costs of property acquisition, exploration, and development incurred. The aggregate of the exploration and development costs incurred in the most recent financial year and

the change during that year in estimated future development costs generally will not reflect total finding and development costs related to reserves additions for that year.o FD&A costs are calculated as capital expenditures plus change in F&D costs. FD&A per boe is calculated as FD&A costs divided by reserves additions for the applicable period.o Cash flow per share (“CFPS”) is determined by dividing cash flow from operations by weighted average shares outstanding.o Return on average capital employed (“ROACE”) is determined by dividing net income by average capital employed.


ADVISORIES• "BOEs" may be misleading, particularly if used in isolation. A BOE conversion ratio of six thousand cubic feet of natural gas to one barrel of oil equivalent (6 mcf: 1 bbl) is based on an energy equivalency

conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to naturalgas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.

• All of Parex’ crude oil reserves disclosed herein are located in Colombia. The Company does have light, medium and heavy crude oil and natural gas liquids. The recovery and reserve estimates of crude oilreserves provided in this document are estimates only, and there is no guarantee that the estimated reserves will be recovered. Actual crude oil reserves may eventually prove to be greater than, or less than,the estimates provided herein. All evaluations and reviews of future net revenue contained in GLJ's reports are stated prior to any provision for interest costs or general and administrative costs and after thededuction of royalties, development costs, production costs, well abandonment costs and estimated future capital expenditures for wells to which reserves have been assigned.

• Certain information in this document may constitute "analogous information" as defined in NI 51-101. Such information includes production estimates, reserves estimates and other information retrieved fromother publicly available sources. Management of Parex believes the information is relevant as it may help to define the reservoir characteristics and production profile of lands in which Parex may hold aninterest. Parex is unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor and is unable to confirm that the analogous information was prepared inaccordance with NI 51-101. Such information is not an estimate of the production, reserves or resources attributable to lands held or to be held by Parex and there is no certainty that the production, reservesor resources data and economic information for the lands held or to be held by Parex will be similar to the information presented herein. The reader is cautioned that the data relied upon by Parex may be inerror and/or may not be analogous to such lands held or to be held by Parex.

• Certain other information contained in this presentation has been prepared by third-party sources, which information has not been independently audited or verified by Parex. No representation or warranty,express or implied, is made by Parex as to the accuracy or completeness of the information contained in this document, and nothing contained in this presentation is, or shall be relied upon as, a promise orrepresentation by Parex.

Financial Matters

• The Company discloses several financial measures (“non-GAAP measures”) that do not have any standardized meaning prescribed under International Financial Reporting Standards ("IFRS"), including cashnetbacks. Management believes that this non-GAAP measure is useful supplemental information to analyze operating performance and provide an indication of the results generated by the Company’sprincipal business activities. Investors should be cautioned that this measure should not be construed as an alternative to net income or other measures of financial performance as determined in accordancewith IFRS. Parex’ method of calculating this measure may differ from other companies, and accordingly, it may not be comparable to similar measures used by other companies. Please see the Company’s mostrecent Management’s Discussion and Analysis, which is available at www.sedar.com for additional information about these financial measures

Annual General Meeting · Rumba Field Capachos-2 Great country to build a profitable business. ......

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