Quarterly Commodity Price Update: Global Equity Research

Canadian & LatAm Energy
Quarterly Commodity Price Update

Global Equity Research
OUR TAKE: Positive. We have updated our commodity price forecasts, along with our
Daily Edge | Pre-market company estimates, valuations, target prices, ratings, and risk rankings.
Thursday, January 13, 2022
KEY POINTS
Analyst Team Link to ScotiaView

Global Oil Benchmarks. Our Brent and WTI price assumptions are relatively unchanged
Jason Bouvier, CFA | Analyst
Scotia Capital Inc. - Canada | 403-213-7345
through 2026 as we maintain our positive bias on the medium-term outlook. In the near term,

we see global oil supply exceeding demand in H1/22. It is our view that the OPEC plus alliance
Cameron Bean | Analyst
Scotia Capital Inc. - Canada | 403-218-6786
will need to revisit their current production agreement of increasing supply by 400 mbbl/d a

month through 2022. Looking at the Canadian oil market, differentials narrowed in the last
Kevin Fisk, CPA, CBV | Senior Associate
Scotia Capital Inc. - Canada | 403-213-7768 half of Q4/21 as new pipeline egress came online. Additional pipeline egress is expected to
enter service in H1/23, which will provide several years of runway depending on the pace of

Jessica Fu, CA, CFA | Senior Associate

Scotia Capital Inc. - Canada | 403-213-7349 production growth.

Austin Glenn | Associate

Scotia Capital Inc. - Canada | 403-605-0871 North American Natural Gas. We are revising down our 2022 Henry Hub estimate to US$3.75/
mmBtu, while maintaining our medium and long-term forecasts. We expect the dynamics of
Rating Changes
New Old an under-supplied international market to keep US feedgas flows running at or near all-time
This report is intended for replaceme@bluematrix.com. Unauthorized distribution of this report is prohibited.
CPG-T SP SO highs but are concerned about growing production. We made modest changes to our near-
ERF-T SP SO term AECO differential forecasts (Q1/22: US$0.60/mmBtu; Q2/22: US$0.85/mmBtu) while
OVV-N SO SP keeping our 2H/22 through 2025 estimates unchanged. We remain cautiously optimistic that
Target Changes the tumultuous times on the NGTL system are in the past and expect the AECO differential to
New Old
approximate the marginal cost of out-of-basin transportation for the next few years – though
VET-T C$20.00 C$16.00
we continue to caution that NGTL system dynamics are always an adventure.
BTE-T C$4.50 C$4.25
CNQ-T C$64.00 C$60.00
CVE-T C$20.00 C$19.00
Equity Forecasts. For oil-weighted names, CFPS estimates increased by an average of 5% in
CPG-T C$8.50 C$7.50 2022 and 3% in 2023. Meanwhile, gas-weighted names saw CFPS estimates decrease by an
ERF-T C$16.00 C$15.00 average of 10% in 2022, and increase by 2% in 2023.
IMO-T C$56.00 C$52.00
MEG-T C$16.00 C$14.00 IMPORTANT REVISIONS
OVV-N US$46.00 US$44.00
SU-T C$38.00 C$37.00 • Ratings. OVV upgraded to Sector Outperform, CPG and ERF downgraded to Sector
WCP-T C$9.25 C$9.00 Perform.
AAV-T C$10.50 C$9.50
CR-T C$4.50 C$4.25
NVA-T C$10.00 C$8.50
• Risk rankings. No risk ranking changes.
PEY-T C$18.00 C$17.00
SDE-T C$14.00 C$13.00
• Target prices. On average, target prices increased by 5%. Notable outliers include VET
TOU-T C$77.00 C$76.00 (+25%), and MEG (+14%).
TOP PICKS
• Large-cap oil-weighted: CVE-T and IMO-T
• SMid-cap oil-weighted: MEG-T
• Large-cap Montney / natural gas: TOU-T
• SMid-cap Montney / natural gas: SDE-T
• Royalty and income stream: TPZ-T
Production: January 12, 2022, 20:59 ET. Dissemination: January 13, 2022, 06:32 ET.
For Reg AC Certification and important disclosures see Appendix A of this report. Analysts
employed by non-U.S. affiliates are not registered/qualified as research analysts with FINRA in
the U.S. unless otherwise noted within this report.
Daily Edge | Pre-market

Exhibit
1 - Revised Commodity Price Forecasts (USD, unless otherwise indicated)
Source: Bloomberg; NYMEX; Scotiabank GBM estimates.

Crude Oil. We have increased our WTI forecast by 3% in 2022 and no changes were made in 2023 onwards. Our 2022 Western Canadian
Heavy Crude (WCS) spread of US$14.64/bbl is largely unchanged while we have narrowed the differential for 2023 onwards by 3%. For our
Canadian light sweet estimates, we increased our forecast for 2022 by 3% and no changes were made to our estimates in 2023 onwards.
Further, our NYH 321 crack spread forecast increased by 23%/5%/7%/5% between 2022 and 2025, while we increased the long-term crack
spread by 4%.
Natural Gas. We decreased our 2022 NYMEX Henry Hub estimate to US$3.75/mmbtu (-20%). Our estimates for 2023 and beyond remain
unchanged. We narrowed our 2022 AECO basis forecast to $US0.80/mmbtu (-6%) No changes were made to the AECO basis in 2023 and
beyond.
Rationale for Rating Changes
Ovintiv (OVV-N). The company now boasts one of the highest DAFCF yields in our coverage universe (and versus its US peer group). In
addition, OVV has made meaningful strides in increasing its sustainability. Decline rates and cost structure are lower and debt repayment
remains a priority. We believe as the company continues to improve its balance sheet, legacy costs continue to roll off its cost structure and
shareholder returns are enhanced the stock will outperform its peer group.
Crescent Point (CPG-T). We are largely downgrading on the strong share price performance. The stock has outperformed many companies
in our universe over the past 3 and 6 months and now its valuation is more in line with an SP-rated company. We continue to like the
company’s recent Duvernay acquisition and believe it will continue to bear fruit for the company.
Enerplus (ERF-T). We are largely downgrading on the strong share price performance. The stock has outperformed many companies in our
universe over the past 3 and 6 months and now its valuation is more in line with an SP-rated company. We continue to like the company’s
recent transactions as they enhanced both current FCF as well as strengthened the company’s overall inventory.

Global Equity Research 2

Exhibit
2 - Changes to Scotiabank GBM Estimates, Ratings, and Target Prices
Note: Figures in CAD unless otherwise noted.
Source: Company reports; Scotiabank GBM estimates.


D
ebt Statistics
Exhibit 3 shows current bank debt (less cash on the balance sheet) as a percentage of each company’s credit facility, while Exhibit 4 shows
the ratio of estimated year-end net debt to cash flow (2022E).
Exhibit 3 - Current Bank Debt (Less Cash) as a Percentage of Bank Line

Exhibit 4 - Net Debt to Cash Flow (2022E)


C
ash Flow Sensitivity Statistics
Exhibit 5 shows company sensitivities to a +US$5/bbl increase to WTI prices including the effects of hedging, while Exhibit 6 shows the same
sensitivity excluding the effects of hedging. Similarly, Exhibit 7 shows company sensitivities to a +US$0.25/mmBtu increase to Henry Hub
prices including the effects of hedging, while Exhibit 8 shows the same sensitivity excluding the effects of hedging.
Exhibit 5 - 2022E CF Sensitivity to a +US$5/bbl change in WTI including the impact of hedges
Exhibit 6 - 2022E CF Sensitivity to a +US$5/bbl change in WTI excluding the impact of hedges


Exhibit
7 - 2022E CF Sensitivity to a +US$0.25/mmBtu change in HH including the impact of hedges
Source: Company reports; Scotiabank GBM estimates
Exhibit 8 - 2022E CF Sensitivity to a +US$0.25/mmBtu change in HH excluding the impact of hedges


Exhibit
9 - Scotiabank GBM Comparative Valuation Analysis
Source: Bloomberg; FactSet; Company reports; Scotiabank GBM estimates.


Exhibit
10 - Scotiabank GBM Comparative Valuation Analysis (Continued)
Source: Bloomberg; FactSet; Company reports; Scotiabank GBM estimates.


Pertinent Data and Revisions

Price Rating 1-Yr. Target 1-Yr. Return
AAV-T C$7.74 SO C$10.50 36.9%
AOI-T* C$1.97 SP C$2.50 34.4%
ARX-T C$13.49 SO C$23.00 80.5%
BIR-T C$7.31 SO C$11.00 57.7%
BTE-T* C$4.48 SP C$4.50 0.9%
CNQ-T C$61.71 SO C$64.00 9.3%
CPG-T C$8.45 SP C$8.50 7.7%
CR-T* C$3.42 SP C$4.50 34.3%
CVE-T C$18.08 SO C$20.00 12.9%
ERF-T C$14.64 SP C$16.00 13.5%
FRU-T C$12.58 SP C$14.00 17.5%
IMO-T C$49.43 SO C$56.00 16.6%

IPCO-T C$8.03 SO C$10.00 26.1%
KEL-T C$5.63 SO C$8.00 50.9%
MEG-T* C$13.60 SO C$16.00 18.3%
NVA-T* C$8.27 SP C$10.00 21.4%
OVV-N US$39.34 SO US$46.00 18.3%
PEY-T C$11.10 SO C$18.00 78.5%
POU-T C$27.04 SP C$25.00 -2.7%
PSK-T C$14.63 SP C$17.00 22.0%
PXT-T C$24.40 SO C$35.00 44.9%
SDE-T C$7.03 SO C$14.00 105.9%
SU-T C$35.19 SO C$38.00 12.8%
TOU-T C$45.75 SO C$77.00 73.9%
TPZ-T C$18.50 SO C$27.00 52.7%
VET-T C$18.66 SP C$20.00 8.1%
WCP-T C$8.60 SP C$9.25 13.5%
*Speculative risk ranking.
Advantage Energy Ltd. (AAV-T; C$7.74)

New Old
1-Yr. Target C$10.50 C$9.50
Key Data CFPS21E: C$1.25 CFPS21E: C$1.32
CFPS22E: C$1.83 CFPS22E: C$2.26
CFPS23E: C$1.86 CFPS23E: C$1.77
NAVPS: C$13.70 NAVPS: C$12.38
Africa Oil Corp. (AOI-T; C$1.97)

New Old
Key Data CFPS22E: US$0.76 CFPS22E: US$0.73
Valuation 1.0x NAV + RU Based on our risked NAV Based on our risked NAV (C$2.47/share)
(C$2.52/share). that also equates to 1.7x 2022E debt-
adjusted CF and 0.88x our 2P NAV.



ARC Resources Ltd. (ARX-T; C$13.49)
New Old
CFPS22E: C$4.27 CFPS22E: C$4.58
CFPS23E: C$4.65 CFPS23E: C$4.55
Baytex Energy Corporation (BTE-T; C$4.48)

New Old
1-Yr. Target C$4.50 C$4.25
CFPS22E: C$1.50 CFPS22E: C$1.49
CFPS23E: C$1.77 CFPS23E: C$1.72
Valuation 14.2% 2022E DAFCF Yield 16% 2022E DAFCF Yield
Birchcliff Energy Ltd. (BIR-T; C$7.31)

New Old
CFPS22E: C$2.13 CFPS22E: C$2.62
CFPS23E: C$2.00 CFPS23E: C$2.04
Canadian Natural Resources Limited (CNQ-T; C$61.71)

New Old
1-Yr. Target C$64.00 C$60.00
CFPS22E: C$11.71 CFPS22E: C$11.53
CFPS23E: C$11.72 CFPS23E: C$11.63
Valuation 11% 2022E DAFCF Yield 12% 2022E DAFCF Yield
Cenovus Energy Inc. (CVE-T; C$18.08)

Key Risks: Commodity prices, crack spreads, timing of projects, and project execution.
New Old
1-Yr. Target C$20.00 C$19.00
CFPS22E: C$4.24 CFPS22E: C$3.64
CFPS23E: C$4.83 CFPS23E: C$4.27



Crescent Point Energy Corp. (CPG-T; C$8.45)
Key Risks: Crude oil and natural gas prices; CAD/USD exchange rate; drilling program success.
New Old
Rating SP SO
1-Yr. Target C$8.50 C$7.50
CFPS22E: C$3.17 CFPS22E: C$3.12
CFPS23E: C$3.47 CFPS23E: C$3.44
Crew Energy Inc. (CR-T; C$3.42)

New Old
1-Yr. Target C$4.50 C$4.25

CFPS22E: C$1.28 CFPS22E: C$1.51
CFPS23E: C$1.48 CFPS23E: C$1.55
Enerplus Corporation (ERF-T; C$14.64)
Key Risks: Crude oil and natural gas prices; CAD/USD exchange rate; drilling program success
New Old
Rating SP SO
1-Yr. Target C$16.00 C$15.00
CFPS22E: C$4.48 CFPS22E: C$4.73
CFPS23E: C$5.67 CFPS23E: C$5.72
Freehold Royalties Ltd. (FRU-T; C$12.58)

New Old
CFPS22E: C$1.47 CFPS22E: C$1.49
Valuation 10% 2022E DAFCF Yield 12% 2022E DAFCF Yield
Imperial Oil Limited (IMO-T; C$49.43)

Key Risks: Commodity prices, crack spreads, timing of projects, and project execution.
New Old
1-Yr. Target C$56.00 C$52.00
CFPS22E: C$9.25 CFPS22E: C$7.98
CFPS23E: C$10.33 CFPS23E: C$9.72



International Petroleum Corporation (IPCO-T; C$8.03)
New Old
CFPS22E: US$2.26 CFPS22E: US$2.27
Kelt Exploration Ltd. (KEL-T; C$5.63)

New Old
CFPS22E: C$1.34 CFPS22E: C$1.47
MEG Energy Corp. (MEG-T; C$13.60)

Key Risks: Commodity prices, timing of projects, and project execution
New Old
1-Yr. Target C$16.00 C$14.00
CFPS22E: C$4.24 CFPS22E: C$4.14
NuVista Energy Ltd. (NVA-T; C$8.27)

New Old
1-Yr. Target C$10.00 C$8.50
CFPS22E: C$2.48 CFPS22E: C$2.63
CFPS23E: C$2.70 CFPS23E: C$2.63
Ovintiv Inc (OVV-N; US$39.34)
Key Risks: Commodity prices, timing of projects, and project execution.
New Old
Rating SO SP
1-Yr. Target US$46.00 US$44.00
NAVPS: US$49.80 NAVPS: US$51.05
Paramount Resources Ltd. (POU-T; C$27.04)

New Old
CFPS22E: C$6.52 CFPS22E: C$6.79
CFPS23E: C$6.53 CFPS23E: C$6.40



Parex Resources Inc. (PXT-T; C$24.40)
New Old
Key Data CFPS21E A: US$4.73 CFPS21E A: US$4.64
CFPS22E A: US$5.70 CFPS22E A: US$5.57
Peyto Exploration & Development Corp. (PEY-T; C$11.10)

New Old
1-Yr. Target C$18.00 C$17.00
CFPS22E: C$4.20 CFPS22E: C$4.52
CFPS23E: C$4.38 CFPS23E: C$4.36
PrairieSky Royalty Ltd. (PSK-T; C$14.63)

New Old
CFPS23E: C$1.31 CFPS23E: C$1.29
Spartan Delta Corp. (SDE-T; C$7.03)

Valuation: 30/20/50 weighting of: 5.0x our blended '22E/'23E DACF, 8% blended '22E/'23E FCFf yield,
and our Scenario Sum of the Assets NAV.
Key Risks: Drilling and completion risk, commodity price risk, acquisition risk, market liquidity risk, ARO
risk, and regulatory risk.
New Old
1-Yr. Target C$14.00 C$13.00
CFPS22E: C$3.34 CFPS22E: C$3.46
CFPS23E: C$4.00 CFPS23E: C$3.89
Suncor Energy Inc. (SU-T; C$35.19)

New Old
1-Yr. Target C$38.00 C$37.00
CFPS22E: C$8.98 CFPS22E: C$8.03
CFPS23E: C$9.90 CFPS23E: C$9.55



Topaz Energy Corp. (TPZ-T; C$18.50)
Valuation: 50/50 Weighting of: 16.0x our blended '22E/'23E FCFf and our Scenario Upstream SOA NAV
plus Midstream DCF (based on our moderate growth scenario).
Key Risks: Acquisition risk, counterparty risk, governance and market liquidity risk, drilling and completion
risk, commodity price risk, and regulatory risk.
New Old
Key Data EBITDA (M)22E: C$251 EBITDA (M)22E: C$271
EBITDA (M)23E: C$241 EBITDA (M)23E: C$238
Tourmaline Oil Corp. (TOU-T; C$45.75)

Valuation: 30/20/50 weighting of: 6.0x our blended '22E/'23E DACF, 8% blended '22E/'23E FCFf yield,
and our Scenario Sum of the Assets NAV.
Key Risks: Oil and natural gas prices; Drilling program success; Gas processing facility constraints.
New Old
1-Yr. Target C$77.00 C$76.00

CFPS22E: C$11.23 CFPS22E: C$12.77
CFPS23E: C$10.36 CFPS23E: C$9.32
Vermilion Energy Inc. (VET-T; C$18.66)

Key Risks: Crude oil and natural gas prices; foreign exchange rates; drilling program success; political/
regulatory.
New Old
1-Yr. Target C$20.00 C$16.00
CFPS22E: C$8.24 CFPS22E: C$6.86
CFPS23E: C$8.53 CFPS23E: C$6.71
Whitecap Resources Inc. (WCP-T; C$8.60)

New Old
1-Yr. Target C$9.25 C$9.00
CFPS22E: C$2.60 CFPS22E: C$2.58
CFPS23E: C$3.02 CFPS23E: C$3.00


Appendix A: Important Disclosures
Company Disclosures (see legend below)*

Advantage Energy Ltd. J, V0177
ARC Resources Ltd. G, HH, I, U
Canadian Natural Resources Limited O1, O3
Cenovus Energy Inc. G, J, N1, U, V0181
Crescent Point Energy Corp. I, V0151, V0168
Enerplus Corporation G, I, U
Freehold Royalties Ltd. G, I, U
Imperial Oil Limited VS0589
Kelt Exploration Ltd. HH
NuVista Energy Ltd. G, I, U
Ovintiv Inc N2
Parex Resources Inc. VS0683

PrairieSky Royalty Ltd. G, I, J, U
Spartan Delta Corp. G, I, U
Suncor Energy Inc. G, H20, I, N1, O1, O3, U
Topaz Energy Corp. I, J
Tourmaline Oil Corp. G, I, O3, U, V0173
Vermilion Energy Inc. HH, I, O1, U, V0179
We, Jason Bouvier, Kevin Fisk and Cameron Bean, certify that (1) the views expressed in this report in connection with securities or issuers
that we analyze accurately reflect our personal views and (2) no part of our compensation was, is, or will be directly or indirectly, related to
the specific recommendations or views expressed by us in this report.
This document has been prepared by Research Analysts employed by The Bank of Nova Scotia and/or its affiliates. The Bank of Nova Scotia,
its subsidiaries, branches and affiliates are referred to herein as "Scotiabank." "Scotiabank" together with "Global Banking and Markets" is the
marketing name of the global corporate and investment banking and capital markets business of The Bank of Nova Scotia and its affiliates.
Scotiabank, Global Banking and Markets produces research reports under a single marketing identity referred to as "globally branded
research" under U.S. rules. This research is produced on a single global research platform with one set of rules which meet the most stringent
standards set by regulators in the various jurisdictions in which the research reports are produced. In addition, the Research Analysts who
produce the research reports, regardless of location, are subject to one set of policies designed to meet the most stringent rules established
by regulators in the various jurisdictions where the research reports are produced.
Scotiabank relies on information barriers to control the flow of non-public or proprietary information contained in one or more areas within
Scotiabank into other areas, units, groups or affiliates of Scotiabank. In addition, Scotiabank has implemented procedures to prevent
research independence being compromised by any interactions they may have with other business areas of The Bank of Nova Scotia. The
compensation of the Research Analyst who prepared this document is determined exclusively by Scotiabank Research Management and
senior management (not including investment or corporate banking).
Research Analyst compensation is not based on investment or corporate banking revenues; however, compensation may relate to the
revenues of Scotiabank as a whole, of which investment banking, corporate banking, sales and trading are a part. Scotiabank Research will
initiate, update and cease coverage solely at the discretion of Scotiabank Research Management. Scotiabank Research has independent
supervisory oversight and does not report to the corporate or investment banking functions of Scotiabank.
For Scotiabank, Global Banking and Markets Research Analyst Standards and Disclosure Policies, please visit www.gbm.scotiabank.com/
disclosures.
For additional questions, please contact Scotiabank, Global Banking and Markets Research, 4 King St W, 12th Flr, Toronto, Ontario, M5H 1A1.
Time of dissemination: January 13, 2022, 06:32 ET. Time of production: January 12, 2022, 20:59 ET. Note: Time of dissemination is defined
as the time at which the document was disseminated to clients. Time of production is defined as the time at which the Supervisory Analyst
approved the document.


Legend
*
G Scotia Capital (USA) Inc. or its affiliates has managed or co-managed a public offering in the past 12 months.
H20 Austin Glenn, a member of Austin Glenn's household and/or an account related to Austin Glenn own securities of this issuer.
HH The Head of Equity Research or a Supervisory Analyst owns securities of this issuer in his or her own account or in a related
account.
I Scotia Capital (USA) Inc. or its affiliates has received compensation for investment banking services in the past 12 months.
J Scotia Capital (USA) Inc. or its affiliates expects to receive or intends to seek compensation for investment banking services in the
next 3 months.
N1 Scotia Capital (USA) Inc. had an investment banking services client relationship during the past 12 months.
N2 Scotia Capital (USA) Inc. had a non-investment banking securities-related services client relationship during the past 12 months.
O1 Scotia Capital Inc. and its affiliates collectively beneficially own in excess of 1% of one or more classes of the issued and outstanding
equity securities of this issuer.
O3 The Bank of Nova Scotia and its affiliates collectively have a net long position in excess of 0.5% of the total issued share capital of
the issuer.
U Within the last 12 months, Scotia Capital Inc. and/or its affiliates have undertaken an underwriting liability with respect to equity or
debt securities of, or have provided advice for a fee with respect to, this issuer.
V0151 Scotia Capital Inc. is acting as financial advisor to Crescent Point Energy Corp in connection with the announced sale of its
southeast Saskatchewan non-core assets.
V0168 Scotia Capital Inc. is acting as financial advisor to Crescent Point Energy Corp. in relation to the announced acquisition of the
Kaybob Duverney Assets from Shell Canada Energy, an affiliate of Royal Dutch Shell plc.
V0173 Scotia Capital Inc. is acting as financial advisor to Tourmaline Oil Corp. in the announced agreement to acquire privately owned
Black Swan Energy Ltd.
V0177 Scotia Capital Inc. is acting as agent to Entropy Inc., a subsidiary of Advantage Energy Ltd., for financing in relation to the
announced initiation of a formal process to explore alternatives for raising external capital, including a private placement of equity
securities for Entropy Inc.
V0179 Scotia Capital Inc. acted as financial advisor to Vermilion Energy Inc. on the Corrib Acquisition.
V0181 Scotia Capital Inc. is acting as financial advisor to Cenovus Energy Inc. on the announced sale of its Tucker oil sands asset to
Strathcona Resources Ltd.
VS0589 Research Associate Kevin Fisk visited the Kearl oil sands project, in Wood Buffalo, Alberta, on March 19, 2019. Full payment was
received from the issuer for the travel-related expenses incurred by the Research Associate to visit this site.
VS0683 Research Analyst Gavin Wylie visited Parex's LLA-34 operations in Colombia on June 6, 2019. The issuer paid for a portion of the
travel-related expenses incurred by the Research Analyst to visit the site.


Rating and Price Target History
Cenovus Energy Inc. (CVE-T) as of January 12, 2022 (in CAD)

12-20-2018 03-21-2019 06-27-2019 01-14-2020 04-07-2020 06-11-2020 07-13-2020 01-14-2021 04-15-2021 06-09-2021 07-15-2021
Price: 9.15 Price: 12.30 Price: 11.59 Price: 12.48 Price: 3.85 Price: 6.12 Price: 5.78 Price: 8.24 Price: 10.15 Price: 12.01 Price: 10.68
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SP Rating: SP Rating: SP Rating: SO Rating: SO Rating: SO
Target: 15.00 Target: 16.00 Target: 15.00 Target: 14.50 Target: 5.00 Target: 6.50 Target: 7.00 Target: 9.25 Target: 12.00 Target: 13.00 Target: 14.00
25
20
Price (CAD)
15
10
0
Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22
10-14-2021 11-19-2021
Price: 14.55 Price: 15.34
Rating: SO Rating: SO
Target: 16.50 Target: 19.00
*Represents the value(s) that changed.

Ratings Legend: FS=Focus Stock; SO=Sector Outperform; SP=Sector Perform; SU=Sector Underperform; T=Tender; UR=Under Review; CS=Coverage Suspended; DC=Discontinued Coverage
Source: Scotiabank GBM estimates; FactSet.
Crescent Point Energy Corp. (CPG-T) as of January 12, 2022 (in CAD)
12-20-2018 01-16-2019 06-27-2019 10-08-2019 11-01-2019 01-14-2020 03-17-2020 04-07-2020 05-07-2020 06-15-2020 01-14-2021
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SP Rating: SP
20
15
Price (CAD)
10
0
02-18-2021 02-23-2021 06-09-2021 10-14-2021

Price: 4.62 Price: 4.99 Price: 5.53 Price: 6.34
Rating: SP Rating: SO Rating: SO Rating: SO
Target: 6.00 Target: 6.00 Target: 6.75 Target: 7.50



Enerplus Corporation (ERF-T) as of January 12, 2022 (in CAD)

11-12-2018 01-28-2019 08-12-2019 01-14-2020 03-17-2020 04-07-2020 06-15-2020 07-13-2020 01-14-2021 04-08-2021 04-15-2021
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO
20
15
Price (CAD)
10
0
06-09-2021 07-15-2021 08-25-2021 10-14-2021 11-19-2021

Price: 8.51 Price: 8.04 Price: 7.00 Price: 11.48 Price: 12.08
Rating: SP Rating: SP Rating: SO Rating: SO Rating: SO
Target: 9.25 Target: 10.00 Target: 10.00 Target: 13.50 Target: 15.00

Imperial Oil Limited (IMO-T) as of January 12, 2022 (in CAD)

12-20-2018 03-21-2019 06-27-2019 10-08-2019 01-14-2020 04-07-2020 10-13-2020 01-14-2021 04-15-2021 05-03-2021
Price: 34.44 Price: 37.18 Price: 35.87 Price: 32.04 Price: 35.04 Price: 17.12 Price: 16.28 Price: 27.88 Price: 32.05 Price: 37.37
Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP
Target: 43.00 Target: 46.00 Target: 40.00 Target: 37.00 Target: 36.00 Target: 23.00 Target: 22.00 Target: 32.00 Target: 35.00 Target: 39.00
50
45
40
Price (CAD)
35
30
25
20
15
10
06-09-2021 07-15-2021 10-14-2021 11-19-2021

Price: 41.25 Price: 35.09 Price: 42.33 Price: 42.76
Rating: SP Rating: SP Rating: SP Rating: SO
Target: 42.00 Target: 43.00 Target: 48.00 Target: 52.00



MEG Energy Corp. (MEG-T) as of January 12, 2022 (in CAD)

12-20-2018 01-17-2019 06-27-2019 01-14-2020 04-07-2020 07-13-2020 01-14-2021 04-15-2021 06-09-2021 07-15-2021 10-14-2021
Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SO
14
12
10
Price (CAD)
8
6
4
2
0
11-19-2021
Price: 10.57
Rating: SO
Target: 14.00

Ovintiv Inc (OVV-N) as of January 12, 2022 (in USD)

07-09-2018 02-13-2019 06-27-2019 11-22-2019 01-27-2020 04-07-2020 07-13-2020 10-13-2020 01-14-2021 04-15-2021 06-09-2021
Rating: SO Rating: SO Rating: SO Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP
80
70
60
Price (USD)
50
40
30
20
10
0
07-15-2021 10-14-2021
Price: 27.70 Price: 39.47
Rating: SP Rating: SP
Target: 35.00 Target: 44.00

Spartan Delta Corp. (SDE-T) as of January 12, 2022 (in CAD)

10-19-2020 01-14-2021 04-15-2021 05-31-2021 07-15-2021 07-29-2021 10-14-2021
Price: 2.55 Price: 3.95 Price: 4.05 Price: 4.91 Price: 5.27 Price: 4.89 Price: 5.93
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO
Target: 5.00 Target: 7.00 Target: 7.50 Target: 8.00 Target: 10.00 Target: 10.50 Target: 13.00
20
15
Price (CAD)
10
0



Topaz Energy Corp. (TPZ-T) as of January 12, 2022 (in CAD)

11-13-2020 04-15-2021 06-09-2021 07-15-2021 07-16-2021 10-26-2021
Price: 14.00 Price: 15.00 Price: 15.97 Price: 16.16 Price: 16.37 Price: 17.84
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO
Target: 19.00 Target: 20.00 Target: 21.00 Target: 23.00 Target: 24.00 Target: 27.00
19
18
17
Price (CAD)
16
15
14
13
12
Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20 Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22

Tourmaline Oil Corp. (TOU-T) as of January 12, 2022 (in CAD)

12-20-2018 06-27-2019 01-14-2020 04-07-2020 06-15-2020 07-13-2020 10-20-2020 11-05-2020 01-14-2021 03-11-2021
Price: 16.24 Price: 16.69 Price: 15.25 Price: 9.49 Price: 12.14 Price: 12.55 Price: 17.80 Price: 18.89 Price: 20.98 Price: 26.24
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO
Target: 27.00 Target: 23.00 Target: 21.00 Target: 16.00 Target: 23.00 Target: 24.00 Target: 30.00 Target: 32.00 Target: 35.00 Target: 38.00
50
40
Price (CAD)
30
20
10
0
04-15-2021 05-06-2021 05-19-2021 05-31-2021 06-14-2021 07-15-2021 07-16-2021 10-14-2021

Price: 24.04 Price: 28.64 Price: 29.39 Price: 29.45 Price: 32.63 Price: 33.96 Price: 33.57 Price: 44.68
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO
Target: 40.00 Target: 41.00 Target: 42.00 Target: 43.00 Target: 47.00 Target: 57.00 Target: 59.00 Target: 76.00

Vermilion Energy Inc. (VET-T) as of January 12, 2022 (in CAD)

12-20-2018 04-26-2019 06-27-2019 07-30-2019 10-08-2019 11-01-2019 01-14-2020 03-09-2020 03-17-2020 04-07-2020 06-15-2020
Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SO Rating: SP Rating: SP Rating: SP Rating: SP
60
50
40
Price (CAD)
30
20
10
0
01-14-2021 03-09-2021 03-22-2021 07-15-2021 10-14-2021 11-30-2021

Price: 6.88 Price: 9.19 Price: 9.91 Price: 9.26 Price: 13.59 Price: 12.76
Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP Rating: SP
Target: 8.50 Target: 9.25 Target: 11.50 Target: 12.50 Target: 15.00 Target: 16.00



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Analyst assigns a rating that is relative to his or her coverage universe or an index identified by the Research Analyst that includes, but is not
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The stock is expected to outperform the average 12-month total
return of the analyst’s coverage universe or an index identified by Under Review – The rating has been temporarily placed under
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analyst. by the analyst.
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The stock is expected to perform approximately in line with the
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an index identified by the analyst that includes, but is not limited to,
The Speculative risk ranking reflects exceptionally high financial
stocks covered by the analyst.
and/or operational risk, exceptionally low predictability of financial
Sector Underperform (SU) results, and exceptionally high stock volatility. The Director of
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The stock is expected to underperform the average 12-month total
determination of the Speculative risk ranking.
return of the analyst’s coverage universe or an index identified by
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Ratings Distribution
As of December 31, 2021
Companies Rated Investment Banking Service Provided
in Each Category in the Last 12 Months
Rating Count Percentage Count Percentage
Sector Outperform 287 51% 100 35%
Sector Perform 245 44% 64 26%
Sector Underperform 29 5% 1 3%
For the purposes of the ratings distribution disclosure FINRA requires members who use a ratings system with terms different than
“buy,” “hold/neutral” and “sell,” to equate their own ratings into these categories. Our Sector Outperform, Sector Perform, and Sector
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Quarterly Commodity Price Update: Global Equity Research

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Canadian & LatAm Energy

Quarterly Commodity Price Update

Jessica Fu, CA, CFA | Senior Associate

Austin Glenn | Associate

• Large-cap oil-weighted: CVE-T and IMO-T

• SMid-cap oil-weighted: MEG-T

• Large-cap Montney / natural gas: TOU-T

• SMid-cap Montney / natural gas: SDE-T

• Royalty and income stream: TPZ-T

Source: Bloomberg; NYMEX; Scotiabank GBM estimates.

Rationale for Rating Changes

Note: Figures in CAD unless otherwise noted.

Source: Company reports; Scotiabank GBM estimates.

Exhibit 3 - Current Bank Debt (Less Cash) as a Percentage of Bank Line

Source: Company reports; Scotiabank GBM estimates.

Exhibit 4 - Net Debt to Cash Flow (2022E)

Source: Company reports; Scotiabank GBM estimates.

Source: Company reports; Scotiabank GBM estimates.

Source: Company reports; Scotiabank GBM estimates.

Source: Company reports; Scotiabank GBM estimates

Exhibit 8 - 2022E CF Sensitivity to a +US$0.25/mmBtu change in HH excluding the impact of hedges

Source: Company reports; Scotiabank GBM estimates.

Source: Bloomberg; FactSet; Company reports; Scotiabank GBM estimates.

Source: Bloomberg; FactSet; Company reports; Scotiabank GBM estimates.

Pertinent Data and Revisions

IMO-T C$49.43 SO C$56.00 16.6%

Advantage Energy Ltd. (AAV-T; C$7.74)

Africa Oil Corp. (AOI-T; C$1.97)

Baytex Energy Corporation (BTE-T; C$4.48)

Birchcliff Energy Ltd. (BIR-T; C$7.31)

Canadian Natural Resources Limited (CNQ-T; C$61.71)

Cenovus Energy Inc. (CVE-T; C$18.08)

Crew Energy Inc. (CR-T; C$3.42)

Key Data CFPS21E: C$0.88 CFPS21E: C$0.89

Freehold Royalties Ltd. (FRU-T; C$12.58)

Imperial Oil Limited (IMO-T; C$49.43)

Kelt Exploration Ltd. (KEL-T; C$5.63)

MEG Energy Corp. (MEG-T; C$13.60)

NuVista Energy Ltd. (NVA-T; C$8.27)

Paramount Resources Ltd. (POU-T; C$27.04)

Peyto Exploration & Development Corp. (PEY-T; C$11.10)

NAVPS: C$20.09 NAVPS: C$18.50

PrairieSky Royalty Ltd. (PSK-T; C$14.63)

Spartan Delta Corp. (SDE-T; C$7.03)

Suncor Energy Inc. (SU-T; C$35.19)

Tourmaline Oil Corp. (TOU-T; C$45.75)

1-Yr. Target C$77.00 C$76.00

Vermilion Energy Inc. (VET-T; C$18.66)

Whitecap Resources Inc. (WCP-T; C$8.60)

Appendix A: Important Disclosures

Company Disclosures (see legend below)*

Parex Resources Inc. VS0683

Rating and Price Target History

Cenovus Energy Inc. (CVE-T) as of January 12, 2022 (in CAD)

Target: 16.50 Target: 19.00

*Represents the value(s) that changed.

02-18-2021 02-23-2021 06-09-2021 10-14-2021

*Represents the value(s) that changed.

Enerplus Corporation (ERF-T) as of January 12, 2022 (in CAD)

06-09-2021 07-15-2021 08-25-2021 10-14-2021 11-19-2021

*Represents the value(s) that changed.

Imperial Oil Limited (IMO-T) as of January 12, 2022 (in CAD)

06-09-2021 07-15-2021 10-14-2021 11-19-2021