TSX: BXE

Full Cycle Profitable Growth

CORPORATE PRESENTATION
MARCH 2016

NYSE: BXE

Advisories
FORWARD LOOKING STATEMENTS: In the interest of providing Bellatrixs shareholders and potential investors with information regarding Bellatrix, including managements assessment of Bellatrixs future plans and operations, certain statements made by the presenter and contained in these presentation
materials (collectively, this presentation) are forward looking statements or information within the meaning of applicable securities legislation, collectively referred to herein as forward looking statements. The forward-looking statements contained in this presentation speak only as of the date of this
presentation and are expressly qualified by this cautionary statement. Forward looking statements in this presentation include, but are not limited to: management's assessment of future plans, operations and strategy, including the Companys Spirit River play as a low cost natural gas supply source; the
sufficiency of Companys firm transportation capacity and ability to grow production to 60,000 boe/d; the Companys cost profile and capital efficiencies; the Companys first half 2016 capital, production and operating cost guidance; the Companys liquidity and compliance with the senior debt / EBITDA financial
covenant; future cost reductions associated with the Alder Flats Plant; managements expectations regarding the Mannville/Spirit River and Cardium areas; managements estimates of payouts and the internal rate of return (IRR) of its wells; the Companys future corporate decline rate; estimates of the
Companys future required maintenance capital the impact of strategic infrastructure on revenues, operating costs and netbacks, and forecasted liquid recoveries from the Alder Flats Plant; drilling plans and the timing thereof; commodity price risk management strategies; estimates of commodity prices and
exchange rates; and drilling inventory and costs and time to develop. Certain statements may constitute financial outlooks under applicable securities laws and were approved by management on March 15, 2016. Forward-looking statements necessarily involve risks, including, without limitation, risks associated
with oil and gas exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity prices, currency fluctuations, imprecision of reserve estimates, environmental risks, competition from other producers, inability to retain drilling rigs and other services,
incorrect assessment of the value of acquisitions, failure to realize the anticipated benefits of acquisitions, actual results from wells to be drilled may not be similar to the results from previous wells drilled or the expected type curves, and delays resulting from or inability to obtain required regulatory approvals
and ability to access sufficient capital from internal and external sources. Events or circumstances may cause actual results to differ materially from those predicted, as a result of the risk factors set out and other known and unknown risks, uncertainties, and other factors, many of which are beyond the control of
Bellatrix. In addition, forward-looking statements or information are based on a number of factors and assumptions which have been used to develop such statements and information but which may prove to be incorrect and which have been used to develop such statements and information in order to provide
shareholders with a more complete perspective on Bellatrix's future operations. Such information may prove to be incorrect and readers are cautioned that the information may not be appropriate for other purposes. Although Bellatrix believes that the expectations reflected in such forward-looking statements
or information are reasonable, undue reliance should not be placed on forward looking statements because Bellatrix can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among
other things: the impact of increasing competition; the general stability of the economic and political environment in which Bellatrix operates; the timely receipt of any required regulatory approvals; the ability of Bellatrix to obtain qualified staff, equipment and services in a timely and cost efficient manner;
drilling results; the ability of the operator of the projects which Bellatrix has an interest in to operate the field in a safe, efficient and effective manner; the ability of Bellatrix to obtain financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas
reserves through acquisition, development of exploration; the timing and costs of pipeline, storage and facility construction and expansion and the ability of Bellatrix to secure adequate product transportation; future commodity prices; currency, exchange and interest rates; the regulatory framework regarding
royalties, taxes and environmental matters in the jurisdictions in which Bellatrix operates; and the ability of Bellatrix to successfully market its oil and natural gas products. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used. As a consequence, actual
results may differ materially from those anticipated in the forward-looking statements. Additional information on these and other factors that could affect Bellatrix's operations and financial results are included in reports on file with Canadian securities regulatory authorities and the U.S. Securities Exchange
Commission ("SEC") and may be accessed through the SEDAR website (www.sedar.com), through the SEC website (www.sec.gov), and at Bellatrix's website (www.bellatrixexploration.com). Furthermore, the forward-looking statements contained herein are made as at the date hereof and Bellatrix does not
undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
NON-GAAP MEASURES: This presentation may contain certain non-GAAP measures, including the term cash flow which is a non-GAAP measure defined as cash from operating activities excluding net change in other assets and liabilities, net change in non-cash working capital and cash tax on sale of assets. This
and any other non-GAAP measures used in this presentation are intended to provide shareholders and potential investors with additional information regarding Bellatrixs liquidity and its ability to generate funds to finance its operations.
FD&A COSTS: This presentation includes calculations of FD&A costs for the year ended December 31, 2015. The calculations of FD&A in this presentation include the reserves additions associated with acquisitions and the costs of acquisitions as Bellatrix believes that including the effect of acquisitions provides
useful information to investors.
BOE PRESENTATION: The term barrels of oil equivalent (boe) 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 natural gas 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 boe
conversions in this presentation are derived from converting gas to oil in the ratio of six thousand cubic feet of gas to one barrel of oil.
INITIAL PRODUCTION RATES: Initial production rates disclosed herein may not be indicative of long-term performance or ultimate recovery. Such rates are not determinative of the future production rates of such wells and do not reflect how the production from such wells will decline thereafter. While
encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for Bellatrix. A pressure transient analysis or well test interpretation has not been carried out in respect of all wells. Accordingly, Bellatrix cautions that the test results should be considered to be
preliminary.
ESTIMATED ULTIMATE RECOVERY (EUR): In this presentation, estimated ultimate recovery represents the estimated ultimate recovery associated with the type curves presented which are based on the assumptions used by Sproule Associates Limited to estimate Bellatrix's proved plus probable reserves per well
as evaluated effective December 31, 2014 based on forecast prices and costs. There is no certainty that such Bellatrix will ultimately recover such volumes from the wells it drills.
ANALOGOUS INFORMATION: Certain information in this presentation may constitute "analogous information" as defined in National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (NI 51-101), including, but not limited to, the reservoir data, production rates of industry wells, cumulative
production information, and economics information relating to the areas in which Bellatrix has an interest. Such information has been obtained from government sources, regulatory agencies or other industry participants. Management of Bellatrix believes the information is relevant as it helps to define the
reservoir characteristics and the reserves and production potential in which Bellatrix holds an interest. Such information has not been prepared in accordance with NI 51-101. Bellatrix is also unable to confirm that the analogous information was prepared by a qualified reserves evaluator or auditor. Such
information is not an estimate of the resources attributable to lands held or to be held by Bellatrix and there is no certainty that the reservoir data, resource estimates, production and decline rates and economics information for the lands held by Bellatrix will be similar to the information presented herein. The
reader is cautioned that the data relied upon by Bellatrix may be in error and/or may prove not be analogous to the lands be held by Bellatrix.
CURRENCY: All dollar amounts in this presentation are Canadian dollars unless otherwise identified.
DRILLING LOCATIONS: This presentation discloses drilling locations in three categories: (i) proved locations; (ii) probable locations; and (iii) unbooked locations. Proved locations and probable locations are sometimes collectively referred to as booked locations, are derived from Bellatrixs most recent
independent reserves evaluation and account for drilling locations that have associated proved + probable reserves or probable-only reserves, as applicable. Unbooked locations as disclosed herein have been identified by management as an estimation of the Company's multi-year drilling activities using
information including evaluation of applicable geologic, seismic, engineering, production, pricing assumptions and reserves information. There is no certainty that Bellatrix will drill all unbooked drilling locations and if drilled there is no certainty that such locations will result in additional oil and gas reserves,
resources or production. The drilling locations on which Bellatrix actually drill wells will ultimately depend upon the availability of capital, regulatory approvals, seasonal restrictions, oil and natural gas prices, costs, actual drilling results, additional reservoir information that is obtained and other factors. While the
majority of Bellatrix's unbooked locations are extensions or infills of the drilling patterns already recognized by the Company's independent qualified reserves evaluator, other unbooked drilling locations are farther away from existing wells where management may have less information about the characteristics
of the reservoir and therefore there may be more uncertainty whether wells will be drilled in such locations and if drilled there may be more uncertainty that such wells will result in additional oil and gas reserves, resources or production.
RESERVES INFORMATION: Unless indicated otherwise, reserve estimates and related future net revenue and other reserves information is derived from Bellatrixs independent reserve report prepared by Sproule Associates Limited as at December 31, 2015 using forecast prices and costs. Land acreage
information is as available at December 31, 2015.
TYPE CURVE AND CAPITAL EFFICIENCY: In this presentation information relating to the type curve, half cycle economics and capital efficiency for Bellatrix's Spirit River wells have been presented. The type curve set forth herein is based on all Bellatrix operated, Notikewin and Falher B wells drilled between
October 2012 and September 2015, and represents the mean (P50) performance curve. Half cycle economics are based on Bellatrix's current expectations of drill, complete, equip and tie-in costs per well (and excluding land, seismic and related costs). Capital efficiency is a measure of expected capital
expenditures per well based on half cycle economics divided by average first year production results (IP365) based on the type curve presented. The type curve and capital efficiency numbers have been presented to provide readers with information on the assumptions used for management's budgeting process
and future planning. The half cycle economics and capital efficiencies may not be achieved on future wells as a result of a number of factors including the risks identified above under "Forward Looking Statements" and as such are not reliable indicators of future performance. In addition, there is no certainty that
future wells will generate results to match historic type curves presented herein. Half cycle economics and capital efficiencies are not terms that have standardized meanings and therefore such calculations may not be comparable with the calculation of similar measures for other entities.
FINANCIAL INFORMATION: Unless otherwise stated, financial information is based upon Bellatrixs 2015 audited consolidated financial statements for the years ended December 31, 2015 and 2014.

Corporate Profile
MARKET SUMMARY
Ticker Symbol

TSX / NYSE: BXE

Average Daily Volume1

Canada: 1.7 million / U.S.: 1.6 million

Shares Outstanding

192.0 million basic / 204.8 million diluted

Market Capitalization2

$315 million

Bank Debt (Q4/2015)

$341 million

Borrowing Base Liquidity

(Q4/2015)3

$200 million

Senior Notes due 2020

US$250 million

Enterprise Value2

$1.03 billion

H1 2016 Average Production

39,000 boe/d (+/- 500 boe/d)

Natural Gas Weighting

72%

Three month average at March 11, 2016

Calculated using March 11, 2016 share price (C$1.64/share). Includes $45 million working capital
deficiency and assumes conversion of US notes at Cdn/US $1.3840 as at December 31, 2015
3 Liquidity reflects undrawn capacity on $540 million credit facility excluding outstanding letters of credit
1
2

Bellatrix Differentiated Strategic Value

TOP TIER ACREAGE POSITION AND RESULTS IN THE SPIRIT RIVER
One of North Americas lowest supply cost natural gas plays
Leading well results deliver superior economic returns and industry leading capital efficiencies

INFRASTRUCTURE AND FIRM TAKEAWAY CAPACITY PROVIDE ABILITY TO GROW

Ownership and control of strategic infrastructure and processing capacity

Ample firm transportation capacity on Alberta NGTL system; ability to grow to 60 mboe/d

FOCUSED ON COST REDUCTIONS AND SHAREHOLDER RETURNS

Structural improvement in cost base: Q4/15 costs down 28% YoY with deep cut plant on-stream
Top tier capital efficiencies and cost profile drive full cycle sustainable profitability

SIGNIFICANT VALUE PROPOSITION & UPSIDE TO COMMODITY PRICE RECOVERY

Supported by material infrastructure assets

Focused on managing debt and further deleveraging at the appropriate time

Long term shareholder value creation

2015 Highlights
SUCCESSFULLY DELIVERED ON KEY STRATEGIC OBJECTIVES IN 2015

Completion and
Commissioning of the BXE
Alder Flats Gas Plant

Commissioned Plant in May 2015

Successful ramp-up of throughput through Q2/15
Achieved 101% utilization in second half 2015

Development Activity Focused

on Spirit River Resource Play

100% success through the drill bit in 2015

Utilized promoted capital on 79% of wells in 2015
Corporate PDP FD&A cost of $9.54/boe in 20151

Significant Cost Reductions

Achieved

Spirit River well costs under $4 million (DCE&T)

Record low operating costs of $6.87/boe in Q4/15
Record low net G&A costs of $1.18/boe in Q4/15

Proactive Financial
Management
5

Credit Facilities had two covenants removed

US$250MM notes offering diversified balance sheet
Significant downside commodity price protection in 2016 & 2017

2015 PDP FD&A excluding $36 million invested directly in BXE Alder Flats Plant. Including total capital investments, PDP FD&A costs averaged $12.37/boe in 2015

Doing More with Less

FIRMLY ACHIEVED GUIDANCE IN 2015 ON STRONG PERFORMANCE
Full year 2015 average production estimated near the high end of the Companys forecast guidance range
of 40,500 to 41,500 boe/d
Net capital spending of approximately $160 million in line with budget
Operating costs 5% below guidance
Net general and administrative expenses 6% below guidance

FIRST HALF 2016 BUDGET BALANCES SUSTAINED PRODUCTION & FINANCIAL FLEXIBILITY
FIRST HALF 2016 GUIDANCE
Production
Average production (boe/d)
Natural gas weighting (%)
Capital and Operating Guidance
Net capital budget ($ millions)1
Operating costs ($/boe)2

38,500 39,500
72%
$46
$7.25

Capital spending includes exploration and development capital projects and corporate assets, and excludes property acquisitions and dispositions.
Operating costs before net processing revenue/fees

Commodity Price Risk Management

NATURAL GAS HEDGES
$3.05

$3.18

60%

$3.02

50%

$3.35

$3.02

$3.35

$3.35

$3.35

40%
30%
20%
10%
0%
Q1/16

Q2/16

Q3/16

Q4/16

AECO Swap $C/Mcf

Q1/17

Q2/17

Q3/17

Q4/17

64.3 MMcf/d @ C$3.18/Mcf (Q1 2016)

87.0 MMcf/d @ C$3.02/Mcf (Q2 & Q3 2016)
81.7 MMcf/d @ C$3.05/Mcf (Q4 2016)
54.7 MMcf/d @ C$3.35/Mcf (2017)

AECO basis swaps

44.0 MMcf/d @ US$0.76/Mcf (Jan 1-Mar31 & Nov1-Dec31, 2016)
40.3 MMcf/d @ US$0.76/Mcf (2017)

OIL HEDGES

50%
40%
30%
20%
10%
0%
Q1/16

Q2/16

Q3/16

Q4/16

WTI MSW Basis Swap

AECO Basis Swap

AECO fixed price swap contract summary:

% of forecast H1/16 oil & condi volumes

% of total forecast H1/16 gas volumes

70%

60%

WTI MSW crude oil basis swap hedges:

2,000 bbl/d @ -US$4.05/bbl (Jan-Sept 2016)

1,500 bbl/d @ -US$4.05/bbl (Oct-Dec 2016)

CURRENCY HEDGES
USD foreign exchange forward contract:

$62.5MM @ 1.308 USD/CAD (value date May 2020)

Percent of total forecast volumes based on mid-point of H1/16 average production guidance (39 mboe/d)
Natural gas hedges converted from $/GJ to $/Mcf based on an assumed average corporate heat content of 40.4 Mj/m3.
All hedges denominated in Canadian dollars unless otherwise noted.

Concentrated Land Base

GREATER FERRIER /
WILLESDEN GREEN

WEST CENTRAL ALBERTA

STRACHAN
Production1 (% of total):

6%

Production1 (% of total):

80%

Land2 (net acres):

43,390

Land2 (net acres):

99,120

P+P net locations:

27

P+P net locations:

211

Unbooked net locations:

36

Unbooked net locations:

518

GREATER PEMBINA

HARMATTAN
Production1 (% of total):

8%

Production1 (% of total):

4%

Land2 (net acres):

85,393

Land2 (net acres):

40,446

P+P net locations:

47

P+P net locations:

29

Unbooked net locations:

155

Unbooked net locations:

122

Reflects % of December 2015 average corporate volumes

Net acreage as at December 31, 2015
Note: Proved, Probable and unbooked locations as at December 31, 2015

OTHER
Production1 (% of total):

2%

Land2 (net acres):

357,036

P+P net locations:

10

Unbooked net locations:

95

Spirit River is the Growth Engine

SPIRIT RIVER PRODUCTION GROWTH

Average monthly production (boe/d)

22,000

2010

20,000

Spirit
River

18,000
16,000

Other

14,000
12,000
10,000

Dec 2015

8,000
6,000
4,000

Other

2,000

Spirit
River

Oct 15

Jul 15

Apr 15

Jan 15

Oct 14

Jul 14

Apr 14

Jan 14

Oct 13

Jul 13

Apr 13

Jan 13

Oct 12

Jul 12

Apr 12

Jan 12

Oct 11

Jul 11

Apr 11

Jan 11

Oct 10

Jul 10

Apr 10

Jan 10

Low cost Spirit River volumes comprise a growing proportion of total corporate production (>50%)
Processing facilities and Firm Transportation (FT) capacity in place to facilitate growth
9

Spirit River Productivity Results

Consistently Rank Best in Class
2015 HIGHEST DELIVERABILITY WELLS IN ALBERTA

20.0

16.0
14.0
12.0
10.0
8.0

Spirit River wells claim 22 of the top 25 wells in Alberta in 2015

Bellatrix delivered four of the top 20 wells in 2015
10

Source: National Bank Financial Inc. research

Based on publicly available first month calendar daily average (first month cumulative / 30 days) production rates from January through December 2015

Spirit River

Spirit River

Spirit River

Spirit River

Montney

Spirit River

Spirit River

Spirit River

Spirit River

Cadomin

Spirit River

Spirit River

Spirit River

Spirit River

Spirit River

Spirit River

Spirit River

Spirit River

Spirit River

Spirit River

Spirit River

0.0

Nikanassin

2.0

Spirit River

4.0

Spirit River

6.0
Spirit River

First month calendar day rate (Mmcfe/d)

18.0

North American Supply Cost Comparison

$4.00
$3.50

Henry Hub (US$/MMbtu)

$3.00
$2.50
$2.00
$1.50
$1.00
$0.50
$0.00

11

Economics assume 15% Before tax IRR, assumes $US0.83 = $CDN1.00, US$0.75/MMbtu AECO basis, and a 20:1 oil-to-gas pricing ratio;
Note (*): Bellatrix economics assume to be free of GORR
Source: RBC Capital Markets Research

Bellatrix Spirit River Competitiveness

BXE SPIRIT RIVER COMPETITIVE WITH TOP TIER MARCELLUS OPERATOR F&D COSTS AND EFFICIENCIES
Marcellus Type Curves1

BXE
Spirit River
Type Curve

SW PA
Super rich

SW PA
Wet

SW PA
Dry

Blended SW PA
40% Wet
60% Dry

Total gross well costs (DCE&T)

US$/well2

$3.0

$5.9

$5.8

$5.2

$5.4

Year 1 production

MMcfe/d

4.7

4.4

7.0

8.3

7.8

3 Year expected recovery

Bcfe

3.0

2.7

5.6

5.9

5.7

5 Year expected recovery

Bcfe

3.7

5.2

7.7

7.6

7.6

EUR

Bcfe

6.0

16.0

20.6

17.6

18.8

Natural gas

% of EUR

76%

37%

42%

100%

77%

F&D costs (3 yr recovery)

US$/Mcfe

$1.00

$2.16

$1.04

$0.89

$0.95

F&D costs (5 yr recovery)

US$/Mcfe

$0.81

$1.13

$0.75

$0.68

$0.71

Year 1 capital efficiency

US$/boepd

$3,863

$8,001

$4,971

$3,747

$4,187

78%

50%

55%

59%

57%

EUR recovered in first 10 years

12

1 Marcellus
2 BXE

type curves and information based on Range Resources Corporation February 25, 2016 corporate presentation disclosure.
(drill, complete, equip & tie in) assumed well costs of $4.0MM CAD converted at $1.33 CAD/USD. Marcellus well costs based on Range Resources drill & complete costs.

Spirit River Geology Summary

Broad, thick, extensive sand rich valleys in Notikewin,
Falher and Wilrich members
Tight sandstone: long life reserves with long term
hyperbolic decline profile
Average thickness 25-40m
2 to 3 stacked channels per section
2-6 wells per pad
3-4 wells per zone to fully develop a section
Porosity 6-18%; permeability 1-3 mD
Peak IP rates at 4.0 to 25.0 MMcf/d
Open and closed fracture systems evident in rock
core and to a lesser degree in rock cuttings

13

Spirit River Liquids Rich Gas

BXE Land Sections
266 Gross1
157 Net1

BXE Net Drilling Inventory2

62 proved
28 probable
292 unbooked
382 total

Formation depth ~2,400 meters

Currently drilling 1 mile laterals

with average 17 frac stages / well

Spirit River
(Notikewin/Falher/Wilrich)
provides significant upside for
Bellatrix
14

1
2

Includes Ferrier, Willesden Green, Greater Pembina and Strachan

Proved, Probable and unbooked locations as at December 31, 2015

FERRIER CORE SPIRIT RIVER PLAY

Spirit River All-In Profitability

C$2 AECO

C$3 AECO

Full cycle F&D costs $/Mcfe

($0.85)

($0.85)

Cash costs

($1.62)

($1.69)

Sales price

$/Mcfe
$/Mcfe

$3.12

$4.01

Full Cycle F&D costs

Drill
Complete
Equip & tie in
Half cycle costs
Land/seismic/facilities
Full cycle costs
EUR (P50)
Full cycle F&D
Cash costs

Profit
Profit margin

$/Mcfe

$0.65

$1.47

21%

37%

Royalties (est @ 8%)

Operating costs 1
Transport2
G&A2
Interest & financing2
Total costs
Sales price

Operating costs assume $0.56/Mcf for natural gas through third party plants, $0.20/Mcf for gas processed
through BXE Alder plant and $8.00/bbl for oil/condensate. Assumed split is 60% 3rd party / 40% BXE plant
2 2015 representative transport, G&A and interest costs based on actual 2015 full year average corporate costs
3 Sales prices assume AECO at $2/Mcf ($1.76/GJ) or $3/Mcf ($2.64/GJ) as per scenario with NGL pricing: ethane @
$10/bbl, propane @ $12/bbl, butane @ $30/bbl and condensate @ $60/bbl incorporating liquids extraction
capabilities in H2/15 given mix of gas through third party and BXE Alder Flats Plant
1

15

Total sales price3

$1.7MM
$1.6MM
$0.7MM
$4.0MM
$1.1MM
$5.1MM
6.0 Bcfe
$0.85/Mcfe
C$2 AECO

C$3 AECO

$0.25/Mcfe
$0.48/Mcfe
$0.19/Mcfe
$0.26/Mcfe
$0.44/Mcfe
$1.62/Mcfe

$0.32/Mcfe
$0.48/Mcfe
$0.19/Mcfe
$0.26/Mcfe
$0.44/Mcfe
$1.69/Mcfe

C$2 AECO

C$3 AECO

$3.12/Mcfe

$4.01/Mcfe

Bellatrix Well Results Rank Top Decile

DISTRIBUTION OF THE TOP CANADIAN NATURAL GAS WELLS DRILLED IN 2015

10

150
135

9
Average Natural Gas Rate (MMcf/d)

Bellatrix well results rank top decile in the basin

16

Source: Peters & Co. Limited Research Report titled Well Update 2015 Year-in-Review Published February 12, 2016 (wells with peak rates greater than 1.0 MMcf/d)
Excludes companies with less than nine wells

DIRECT

BNP

XTO

PROGRESS

CHEVRON

SHELL

CR

BIR

VELVET

APA

HSE

Repsol

POU

CONOCO

PEY

0
PPY

15
MURPHY

1
CNQ

30

ARX

VII

45

UGR

ECA

60

SRX

CANBRIAM

75

TAQA

NVA

90

AAV

BXE

105

TOU

Number of wells

120

Number of Wells

JUPITER

MMcf/d

2015 Spirit River Well Costs &

Capital Efficiencies
SPIRIT RIVER WELL COSTS AVERAGED <$4.0 MILLION CONSISTENTLY IN SECOND HALF 2015
$6.0

Costs ($millions)

$5.0
Equip & Tie-in

$4.0

Complete

$3.0

Drill

$2.0

Average

$1.0
$0.0

2015 CAPITAL EFFICIENCY (IP365 ESTIMATE) AVERAGED UNDER $8,000/BOE/D

Capital Efficiency ($/boe/d)

$20,000
$15,000

Spirit River IP365

Capital Efficiency
($/boe/d)
Full Capital
Program Average

$10,000
$5,000
$0
17

Note: IP365 forecasts based on initial well productivity, reservoir characteristics, and full year well production modeling
Capital efficiency calculated as gross well costs (drill, complete, equip and tie-in) divided by gross IP365 production expectation of Falher B and Notikewin wells drilled
Analysis does not include promoted spend within JV development

Efficiency Gains
AVERAGE SPIRIT RIVER DRILLING CURVES

SPUD TO RIG RELEASE BY YEAR

Days (Spud to Rig Release)

0
2014 Spirit River Average

500

2015 Spirit River Average

2016 Spirit River Average

1,000

2016 Spirit River wells

2,000

15
10
5
0

2,500
3,000

$3.0

3,500

$2.5

4,000
4,500
5,000
0

10
Days Spud to Rig Release

18

2014

2015

2016

DRILL COST BY YEAR

Drill Cost ($MM)

Measured Depth (m)

1,500

20

15

20

$2.0
$1.5
$1.0
$0.5
$0.0

2014

Note: Comparative drilling curves based on Bellatrix hybrid drilling style which constitutes technique employed for majority of wells drilled since 2014
2016 drill costs based on actual results and field estimates

2015

2016

Spirit River Development Comparison

COMPARATIVE 2015 NOTIKEWIN & FALHER COST & EFFICIENCY METRICS

Days to complete

15
10
5

25
20
15
10
5
0

0
BXE

$5.0

BXE

Industry

Reported costs
Completion cost
Drill cost

8.0
IP90 (MMcf/d)

$6.0
Well costs ($ millions)

Number of completion days

$4.0
$3.0
$2.0
$1.0
$0.0

Industry

IP90 Gas rate

6.0
4.0
2.0
0.0

BXE

Industry

BXE

Industry

Average days per stage

2.0
1.5
1.0
0.5
0.0

BXE

Capital efficiency ($/boe/d)

Number of stages

30

Days per completion stage

Frac stages

20

$8,000

IP90 Capital efficiency

$6,000
$4,000
$2,000
$0
BXE

Bellatrix is an industry leader in the development of the Spirit River play

19

Source: Canadian Discovery Frac Database

Data sourced March 14, 2016. Wells completed between January 2015 and December 2015.

Industry

Industry

Greater Ferrier Area Infrastructure Overview

GREATER FERRIER EXISTING
INFRASTRUCTURE ACCESS:

Infrastructure gives Bellatrix control

of production and growth
Working interest or operatorship in
3 major gas processing facilities
11 compressor sites
5 oil batteries

BELLATRIX OCHIESE NEESOHPAWGANUCK DEEP-CUT

GAS PLANT (BXE ALDER FLATS):
Phase I - 110 MMcf/d sales capacity
(on-stream May 2015)
Phase II - 110 MMcf/d sales capacity
(in service 2018, cost +/- $97MM)

C2 Recovery 57%

C3 Recovery 99%

C4+ Recovery 100%

Strategic advantage from

owned infrastructure
lowered costs and
guaranteed access
20

GREATER FERRIER AREA STRATEGIC INFRASTRUCTURE

Significant Investment in Strategic

Infrastructure
OVER $300 MILLION INVESTED SINCE 2013 IN STRATEGIC INFRASTRUCTURE ASSETS

60% owner and operator of the BXE Alder Flats deepcut gas plant
Phase 1: 110 MMcf/d
Phase 2: incremental 110 MMcf/d (H1 2018)

Working interest owner in two other major gas

processing facilities

11 compressor sites with approximately 70,000

compression horse power and 392 MMcf/d gas
compression capacity

Five major oil batteries with over 12,000 bbl/d oil

processing capacity
Over 350 kilometers of gathering and product
transfer pipelines

+$300MM BREAKDOWN

Batteries

BXE Alder
Plant

Pipelines

Compressors

Strategic infrastructure investment results in improved reliability of operations and sales,

reduces operating costs, reduces royalty rates, and provides barriers to competition
21

BXE Alder Flats Superior Operational

Performance in Core West Central AB Area
SUPERIOR & CONSISTENT PLANT PERFORMANCE
120%

FUEL/DISPOSITION EFFICIENCY
Bellatrix Alder Flats

Highest utilization

3rd Party Plant

100%

Plant utilization (%)

Most efficient

3rd Party Plant

80%

3rd Party Plant

60%

3rd Party Plant

3rd Party Plant

40%

3rd Party Plant

20%

3rd Party Plant

3rd Party Plant

Bellatrix Alder Flats

Dec-15

Nov-15

Oct-15

Sep-15

Aug-15

Jul-15

Jun-15

May-15

Apr-15

Mar-15

Feb-15

Jan-15

0%

3rd Party Plants

BXE Alder averaged 100% utilization in Q3/15 & 103% in Q4/15

22

3rd Party Plant

0%
2%
4%
6%
2015 Disposition % of Receipts

BXE Alder Flats ranks lowest

and most efficient

Source: Bellatrix internal data and Alberta Energy Regulator (AER)

Note plant efficiency compares monthly receipts versus licensed gas capacity for third party plants. BXE Alder compares monthly gas receipts versus sales capacity
Note: Fuel disposition efficiency includes fuel, flared and vented dispositions as a % of input plant receipts
Third party plants include greater Ferrier area gas plants: Tidewater Brazeau River Complex, Conoco Sand Creek, Conoco Alder Flats, Keyera Minnehik Buck Lake, Keyera Nordegg, Keyera
Brazeau East, Keyera West Pembina, Keyera Brazeau North, Penn West Crimson Lake

Growing Firm Capacity Within Core Areas

TOTAL BELLATRIX GROSS PROCESSING CAPACITY GREATER FERRIER

300

Twin
Rivers
pipeline
expansion

13-05 booster
compression &
Twin Rivers
pipeline project

200
100
0

Q2 - 2018

Q1 - 2018

Q4 - 2017

Q3 - 2017

BXE Deepcut

Q2 - 2017

Q1 - 2017

Q4 - 2016

Q3 - 2016

BXE Non Op Capacity

Q2 - 2016

Q1 - 2016

Q4 - 2015

Q3 - 2015

23

Q2 - 2015

Third Party Total Capacity

Q1 - 2015

Q4 - 2014

Q3 - 2014

Q2 - 2014

Q1 - 2014

Total Gross Raw Gas Processing Capacity (MMcf/d)

BXE Phase 1 deep

cut 110 MMcf/d

500
400

Total
processing
capacity net to
Bellatrix
estimated at
~80,000 boe/d
in 2017

BXE Phase 2 deep

cut incremental
110 MMcf/d

600

Total Firm Capacity

Focus on Continued Cost Reductions

OPERATING COSTS

NET G&A COSTS

$3.50

$13.00
$12.00

$3.00
Net G&A expense ($/boe)

Operating cost ($/boe)

$11.00
$10.00
$9.00
$8.00

$2.50

$2.00

$1.50

$7.00
$1.00

$6.00
$5.00
2010

2011

2012

2013

2014

2015

Q4/2015

Deep-cut Plant contribution reduces operating

costs markedly
Note: Net G&A expenses after capitalized G&A and recoveries

24

$0.50
2010

2011

2012

2013

2014

2015

Achieved significant cost reductions

through 2015

Q4/2015

Track Record of Production and

Reserves Growth
HISTORICAL RESERVES

11,954
8,519

5,969

7,414

2010

2011

25,596

29,443

30
20

4,540

2,550
5,000

5,717
15,340
10,969

10

0
2012

2013

2014

2015

160

144

140
120

104

100
80

67

60
40

25

0.8

124

42

0.6
0.4

55

42

0.2

25

20
0

0.0

2010

37% CAGR total corporate production

19% CAGR production per share

1.0

161

2011

2012

2013

2014

2015

39% CAGR P+P reserves

22% CAGR P+P reserves per share

CAGR Compounded Annual Growth Rate 2010-2015

Production per share calculated using basic weighted average shares and reserves per share calculated using year end basic shares outstanding

Reserves per year end share (boe/share)

15,000

6,489

180

P+P

16,686

40

1.2

200

Proved

20,000

211

Proved

21,829

220

P+P

50

223

Proved

60

240

P+P

Production (boe/d)

30,000

1.4

250

Proved

12,469

70

Reserves per share (right side)

260

P+P

11,998

35,000

10,000

80

38,065

Oil and Liquids

Proved

40,000

90

P+P

41,441

Proved

45,000

25,000

Natural Gas

Production per share (right side)

Reserves (MMboe)

Oil and Liquids

Production per avg. share (boe/000's shares)

Natural Gas

P+P

HISTORICAL PRODUCTION

Balance Sheet & Financial Flexibility

Effective capital resource management, balancing liquidity and flexibility

Utilized

4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
Q4/15

Bank line utilization 63%

based on Q4/15 bank debt
Next semi-annual
redetermination scheduled
to occur on May 31, 2016

$300

$250

$250
$200
$150
$100
$50
$0

$0

$0

$0

$0

2016 2017 2018 2019 2020

August 2015 announced

two of the three bank
covenants eliminated

Simple balance sheet: bank

debt, unsecured notes, and
common stock

One financial covenant is

Senior Debt/EBITDA (3.5:1)

No near-term note
maturities: US$250 notes
mature in May 2020

Three year revolver

matures in May 2017
26

UNSECURED USD NOTES

MATURE IN 2020
Note maturities (USD$)

Undrawn

CREDIT FACILITY CONTAINS

ONE FINANCIAL COVENANT
Senior Debt/EBITDA

UNDRAWN BANK CAPACITY

OF ~$200 MILLION AT Q4/151

Liquidity reflects undrawn capacity on $540 million credit facility excluding outstanding letters of credit

Compelling Investment Opportunity

Experienced management team
Industry leading well results
Low cost operator and finder
A large inventory of high rate of return drilling locations
Infrastructure and firm take-away capacity provides
strategic advantage
Unfettered growth potential with firm processing capacity
Balance sheet capital management and liquidity
27

Supplemental Information

Peer Group Comparison

OPERATING & TRANSPORTATION COSTS/ BOE1
$16

$14

Costs ($/boe)

$12
$10
$8
$6
$4
$0

BXE

$2

NET G&A & STOCK BASED COMPENSATION EXPENSE/ BOE1

$5.00

$3.00
$2.00
$1.00
$0.00

BELLATRIX IS A LOW COST OPERATOR

29

Source: Public disclosure or calculated where unavailable

Note: Peer set includes AAV, ARX, BIR, BNP, BTE, CR, ERF, KEL, LRE, NVA, PPY, POU, PMT, PEY, PGF, SGY, TET, TOU, VET, VII, WCP.
1 Fourth quarter ended December 31, 2015 average costs

BXE

Expense ($/boe)

$4.00

Joint Ventures
JOINT VENTURES
Grafton JV (GJV)
$305 MM
Effective Date: July 1, 2013
Wells: 72 net wells
BXE / Partner Contribution:
$55 MM / $250 MM

Ferrier, Brazeau

CNOR JV - $500 MM
(Grafton managed co.)
Effective Date: September 29, 2014
Funds expected to be spent from
2016-2019

BXE / Partner Contribution: $250

MM / $250 MM

Development plans/areas to be
determined by management
committee

JV Partner earning terms:

JV Partner earning terms:

Pay 82% to earn 54% before

Pay 50% to earn 33% before payout

Payout: $250MM + 8% IRR
Convert to 10.67% gross overriding

payout

Reversion to 33% after payout

Payout: $250MM + 8% IRR
One time election to convert
33% WI to 17.5% gross
overriding royalty on pre-JV
BXE working interest

30

royalty on pre-JV BXE working

interest

Pro-rata terms match GJV

Bellatrixs differentiated JV strategy

provides significant benefits
Accelerates development potential of our multi-billion dollar
inventory of projects
Non-dilutive mechanism of capital cost funding
Improved capital efficiency of drilling program irrespective of
well productivity
Enhances internal rate of return (IRR) of drilling projects
given front end loaded promoted capital
Insulates against weakening commodity prices given higher
return expectations and improved efficiency metrics

Additional Long Term

Opportunities

Cardium Light Oil Resource Play

BXE Cardium Sections
412 Gross
277 Net

Edson

BXE Net Drilling Inventory1

141 proved
42 probable
273 unbooked
456 total

Pembina
Ferrier

Lease Operate Expense < $9.00/boe

Cardium Resource Play Summary

Largest accumulation of light oil in the WCSB

Approximately 20,000 square miles
Approximately 1.9 Billion bbls produced to date
Currently producing 140,000 bbl/d & 1.0 Bcf/d

Cardium remains a key focus

area for Bellatrix long-term
32

Proved , Probable and unbooked locations as at December 31, 2015

Strachan

Harmattan

Cardium Proven Innovative Development

Leading Cardium driller in 2013/2014

APPLYING CUTTING EDGE EXPLOITATION TECHNIQUES

Horizontal well placement and applying

cutting edge exploitation techniques
results in top-tier well results compared
to industry
DRIVES INDUSTRY LEADING RESULTS
IP90

330

well count

290
250
230
210
190
170

33

ARX

Baccalieu

PWT

Regent

BTE

JOY

WCP

TOG

TVE

BNE

VET

LTS

150

BXE

boe/d

270

Well count

100
90
80
70
60
50
40
30
20
10
0

310

Comparative chart of IP90 production rates for horizontal wells drilled 2013-2014 in greater Pembina/Ferrier/Willesden Green areas
Source: National Bank Financial Inc. Research

Lower Mannville: Liquids-rich Gas Play

Drill locations identified across three
play types

GR

Porosity

31 horizontal Ellerslie wells drilled by

Angle/BXE at Harmattan to date

Net Drilling Inventory:

16 proved
18 probable
89 unbooked
123 total

Liquids-rich gas plays

Liquids yields up to 205 bbl/MMcf
(sales) in the Harmattan area
Schematic Log

34

Second White Specks: Tight Oil Resource

Laterally continuous fairway: >6,000 sq miles
Thick: 75-225m
Over-pressured: 9-14KPA/m
Thermally mature for oil: Tmax 435-455C
High Organic Content (TOC): 1.5-4wt%
Existing vertical production
15 industry HZs drilled
12 with published oil/condensate production
On-going technical work

35

Belly River: Regional Oil & Gas Play

Significant oil production in the Basal Belly River from extensive marine shoreface
deposits
Gas & oil production from lower to upper Belly River fluvial channel deposits

36

Corporate Information
BOARD OF DIRECTORS
W.C. (Mickey) Dunn
Chairman
Doug N. Baker, FCA
Murray L. Cobbe
John H. Cuthbertson, QC
Melvin M. Hawkrigg,
BA, FCA, LLD (Hon.)
Robert A. Johnson, P.Geol.
Keith E. Macdonald, CA

OFFICERS
Raymond G. Smith, P.Eng.
President & CEO
Edward J. Brown, C.A.
Executive Vice President,
Finance & CFO
Brent A. Eshleman, P.Eng.
Executive Vice President & COO
Charles R. Kraus, Esq.
Vice President, General Counsel
& Corporate Secretary
Steve G. Toth, CFA
Vice President, Investor Relations

Steven J. Pully, CPA, CFA

Raymond G. Smith, P. Eng.

ADDRESS
1920, 800 5th Avenue SW
Calgary, Alberta Canada T2P 3T6

Murray B. Todd, B.Sc., P. Eng.

Keith S. Turnbull, B.Sc., CA

37

Tel: (403) 266-8670

Fax: (403) 264-8163
www.bellatrixexploration.com
investor.relations@bellatrixexp.com

BANKERS
National Bank of Canada
Alberta Treasury Branches
HSBC Bank Canada
Canadian Imperial Bank of Commerce
The Bank of Nova Scotia
Bank of Montreal
The Toronto Dominion Bank
Union Bank, Canada Branch
Wells Fargo Bank N.A., Canadian Branch
EVALUATION ENGINEERS
Sproule Associates Limited
REGISTRAR & TRANSFER AGENT
Computershare Trust Company of Canada
AUDITORS
KPMG LLP
EXCHANGE LISTING
The Toronto Stock Exchange - BXE
The New York Stock Exchange - BXE

1920, 800 5th Avenue SW

Calgary, Alberta Canada T2P 3T6
Tel: (403) 266-8670
Fax: (403) 264-8163
www.bellatrixexploration.com