2006 Southwestern Showcase
Dallas, Texas
November 15, 2006
Exploiting Unconventional Gas Reservoirs in
the Antrim and New Albany Shales
Disclaimer
In this slide presentation, statements regarding our goals and objectives, our expected
methods of operation and development strategies, our expected and potential production
volumes, the amount of potential reserves and drilling locations, the timing of drilling
activities, when wells will begin producing, how many wells will be drilled, potential new
development theatres, the spacing of wells, drilling and operating costs, and other
statements that are not historical facts, contain predictions, estimates and other Forward-
Looking Statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. Although we believe that our
expectations are based on reasonable assumptions, we can give no assurance that our
goals will be achieved. Important factors that could cause our actual results to differ
materially from those included in the Forward-Looking Statements include the timing and
extent of changes in commodity prices for oil and gas, changes in market demand, drilling
and operating risks, the availability of drilling rigs, uncertainties about the estimates of
reserves, the availability of transportation pipelines, changes in laws or government
regulations, unforeseen engineering and mechanical or technological difficulties in drilling
and operating the wells, operating hazards, weather related delays, the loss of existing
credit facilities, availability of capital, and other risks more fully described in our filings with
the Securities and Exchange Commission, including Form 10-KSB filed March 31, 2006. We
may also change our business focus as new opportunities arise. All Forward-Looking
Statements contained in this presentation, including any forecasts and estimates, are based
on management’s outlook only as of the date of this presentation and we undertake no
obligation to update or revise these Forward-Looking Statements, whether as a result of
subsequent developments or otherwise.
Key Investment Highlights
Focused on two unconventional “Resource Plays”
Extensive multi-year development drilling inventory in two project areas – Antrim and New
Albany Shale plays
Low-risk, repeatable drilling opportunities with large amounts of resources in place
Over 621,000 net acres assembled, ~ 93%(1) undeveloped as of 6/30/06
~2.3 Tcfe of reserve potential on 2,951 identified drilling locations
Accelerating transition from an acreage builder to a gas “harvester”
301 net wells budgeted to be drilled over 18-months (06/30/06 – 12/31/2007) with 181
Bcfe of potential
Extensive operating experience in Antrim and New Albany Shale plays
Application of leading edge technologies increases recoveries and drives returns
Strong Management / Shareholder alignment
Officers and Directors own ~12%(2) of which ~73% is locked-up through 11/01/08
(2) As of August 15th 2006
(1) 93% refers to undeveloped shale acreage
Aurora Overview
Total Proved Reserves (6/30/06): 105 Bcfe
% Proved Developed: 69%
Est. Net Average Daily Prod. (9/06): 8,074 mcfe/d
Net Shale Acreage (6/30/06): 575,453
% Undeveloped: ~93%
Budgeted Net Wells:
Second half of 2006E: 73
18 month plan: 301
Identified Locations: 2,951
Drilling inventory(1): 10+ years
Portfolio Highlights
168 net wells drilled over the past 30 months
96% success rate
170 net wells producing
38 net wells awaiting hook-up
Historical Drilling Success
(1) Based on 2007 budgeted wells to be drilled.
As of 6/30/06.
Net Acreage by Area
Other
8%
Antrim Shale
20%
New Albany Shale
72%
Map of Operations
The Antrim Shale is an established play that provides significant upside to Aurora’s reserve base
Similar characteristics to other shale plays
Extensively drilled (over 8,000 wells) with a historical success rate of over 95%
Shallow blanket shale formation
Characterized by low development risk and high returns
Current acreage has over 600 Bcfe of potential
The New Albany Shale, though less developed, appears to have similar characteristics to the Antrim
Current acreage has over 1.5 Tcfe of potential
Resource Potential
Over 2.3 Tcfe of reserve potential based on conservative spacing and per well reserve
estimates
Provides over 10 years of drilling inventory at current drilling pace
Aurora’s 18-Month Drilling Plan
18-month drilling plan includes over 301 net identified drilling locations
Estimated reserve potential of over 181 Bcfe on planned drilling capital of over $136 million
Excludes potential PUD locations that can be booked with success
Future activity will come with increased working interest and a higher percentage of operated wells
Experienced Leadership
Operational Team
William Deneau
C.E.O. & President
22 Years
Ronald Huff
C.F.O.
27 Years
John Miller
V.P. Science and
Strategic Planning
18 Years
Thomas Tucker
V.P. Operations
25 Years
2 senior geologists, 1 staff geologist, 1 senior petroleum engineer, 1 drilling superintendent, 1
production supervisor, 1 completion engineer
3 senior land professionals
Operational managers have an average of 24 years of experience in the oil and gas business
Shareholder / Management / Employee alignment
Officers and Directors own ~15% of common stock(1)
(1) As of August 15th 2006
Antrim Shale Project – Development Stage
Portfolio Highlights
Unconventional Shale Play
Net Acreage: 125,993
Net Undeveloped Acreage 90,483
As of 6/30/06:
Total Reserves 101 Bcfe
Estimated Sept. 2006 Production 7,438 Mcfe/d
Net Budgeted Drilling Locations:
Second half of 2006E 60
2007E 168
Historic w.i.: 48%
Anticipated w.i.: 56%
Pricing: NYMEX:+/-$.05
Hedges:
5,000 MMBtu/day @ $8.59 through March 2007
5,000 MMBtu/day @ $9.00 from April 2007 through
December 2008
Antrim Shale
Note: Acreage as of 6/30/06.
Antrim Shale Project Economics
Established, low-risk “Resource Play”
Over 8,000 wells drilled to date in the play w/ ~95% historical drilling success rate
Focus of 2005 / 2006 / 2007 drilling program to provide low-risk source of reserve, production
and cash flow growth
At $6.00 gas we generate an IRR of 35 – 40% (excludes hedging impact)
5,000 MMBtu/day @ $8.59 through March 2007
5,000 MMBtu/day @ $9.00 from April 2007 through December 2008
Antrim Shale Type Curve
Unique Low Pressure Production Technology
Aurora’s Skid-mounted compressor and
water separator
Reduces development costs
Increases production rates
Extends the commercial life of the wells
Facility capacity maximized over life of the wells
Electrical fired
Traditional Large Central Compressor Unit
High production costs
Lower production rates
Shortens commercial life of the well
Less efficient use of facility capacity
Gas fired
Patent Pending Electric Submersible Pumps
(ESP’s) / Tubing Connection
Patent pending on ESP/composite tubing
connection
Allows for “rig-less” installation and
maintenance of ESP’s using coiled tubing
spread
Leads to significant cost savings and
operational advantages especially for
ongoing maintenance
New Albany Shale Project: Early Stage
Development
Portfolio Highlights
Unconventional Shale Play
Net Acreage: 449,460
Net Undeveloped Acreage: 444,494
As of 6/30/06:
Total Reserves: 2 Bcfe
Estimated Sept. 2006 Production: 123 Mcfe / day
Net Budgeted Drilling Locations:
Second Half of 2006E: 9
2007E: 43
Historic w.i.: 17%
Anticipated w.i.: 42%
Pricing: NYMEX: - $0.30
Lease Terms: 5 yr. primary w/
5 year option
New Albany Shale
Note: Acreage as of 3/31/06.
New Albany Shale Project Economics
AOG has participated in the drilling of 123 vertical and 28 horizontal wells since 1995
Provided data -- defining extent and location of shale
Horizontal drilling - key to unlocking potential of New Albany Shale
14 horizontal wells currently producing and validating economic assumptions
Independent review performed by Schlumberger Data and Consulting Services
Schlumberger reservoir engineering indicates 0.9 – 1.3 bcfe horizontal wells on 320-acre
spacing
At $6.00 gas we generate an IRR of 28 – 35%
New Albany Shale Type Curve
The “Fractured Fairway” of the NAS
1)
El Paso NAS Pilot (14 wells)
2)
Horizontal Test (3.5 bcfg-single well)
3)
1950’s Loogootee Field (3 verticals @750 mcfg/d)
4)
Baker Well Blowout (3,000 mcfg/d)
5)
Horizontal (3 big gas shows)
6)
Horizontal Well (strong gas flow)
7)
Diversified Pilot Wells (announced 100 well program)
8)
Highly Fractured NAS Cores
9)
Highly Fractured NAS Test
10)
1970’s Linton NAS Field
11)
Gas Well (vertical @ 700 mcfg/d)
12)
Aurora Pilot Well (Cardinal Unit)
13)
Aurora Pilot Well (Eagle Unit)
14)
1980’s Coalmont NAS Gas Field (vertical wells)
15)
Test Wells (strong gas flows)
16)
Yankeetown Test Well (1,200 mcfg/d)
17)
Dickeyville Test Well (4,400 mcfg/d)
18)
Fritz Well (strong gas shows)
19)
Russellville Field (vertical wells)
Kentucky
Indiana
Fractured Fairway
Early Stage Development Project Reserve
Add Potential
Early stage development projects benefit
from PUD offset booking potential
Leads to rapid reserve growth
13 wells have added 25 PUD locations at
6/30/2006
18-month drilling budget in New Albany
shale
52 net wells with 57.2 Bcfe of net potential
Provides opportunity to add a multiple of
reserve totals with PUD offset bookings
In time, the mix will shift to a more
balanced reserve-production growth profile
Note: Represents a 1,600 acre section
PDP Location
PUD Offset
Historical Operating Results
EBITDA and LOE
Aurora Summary
Two compelling shale plays at different stages of development:
(1) Antrim: Development Stage Project
1,260 locations with 630 Bcfe of net potential
228 net wells to be drilled over 18-months
~$74.2 million in drilling capital expenditures
114 Bcfe of net reserve potential
(2) New Albany: Early Stage Development Project
Encountering encouraging results from first 14 wells
Validating assumptions about the New Albany Shale
1,405 locations with 1.5 Tcfe of net potential
52 net wells to be drilled over 18-months
~$44.5 million in drilling capital expenditures
57 Bcfe of net reserve potential
(3) Other
21 net wells to be drilled over 18 months
+181 Bcfe
18-month Plan - Reserve Impact
Questions?
Contact:
Jeffrey W. Deneau - Investor Relations
Aurora Oil & Gas Corp.
4110 Copper Ridge Drive, Suite 100
Traverse City, MI 49684
www.auroraogc.com
T: 231-941-0073
E: jdeneau@auroraogc.com
Share Price: $3.38
Shares Outstanding: 82.025M
Market Cap: $277M
*Figures based on close 11/03/06
