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Invest in Oil Income Trust Fund - Petrocapita

Invest in Oil Income Trust Fund - Petrocapita



Petrocapita is an Oil Income Trust Fund. Investing in Oil properties in Lloyd minister area of Alberta. Ongoing Cash Flow investment. Contact for more details - bketcheson@raintreeEMD.com

Petrocapita is an Oil Income Trust Fund. Investing in Oil properties in Lloyd minister area of Alberta. Ongoing Cash Flow investment. Contact for more details - bketcheson@raintreeEMD.com



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    Invest in Oil Income Trust Fund - Petrocapita Invest in Oil Income Trust Fund - Petrocapita Document Transcript

    • Energy is a big part of your life ... is it a part of your investment portfolio?Invest In Energyn 10.25% annual incomen Profit sharing upside
    • E nergy use is growing every day with global demand for oil projected to increase up to 60% by 2030. The major drivers of this demand growth are the emerging economies, particularly China. China is undergoing a once in a life-time industrialization that is expected to increase its consumption from its current lows of around 2-3 barrels per person per year to developed nation levels of around 20 barrels per person per year. Despite the challenging supply/demand environment, oil is trading below its inflation-adjusted peak in the 1970s. Petrocapita allows investors to obtain direct exposure to oil production without taking the typical degree of exploration risk common in most oil investment vehicles combined with an ongoing income stream PLUS profit sharing upside potential.2
    • Petrocapita Income TrustWho Are We? Why Invest Directly In Oil?We are an income trust based in Calgary, Alberta Canada. We believe that well managed energy investments will beWe have created Petrocapita as a convenient way for profitable because global energy demand will continue toinvestors to add oil backed income and profit sharing to put upward pressure on prices.their investment portfolios.What Do We Do? Where Do We Invest?Petrocapita raises capital and deploys that capital in the We are focusing on western Canada as our target marketpurchase of cash-flow generating oil and gas assets. due to our market knowledge and an abundance of com- petitively priced energy assets combined with world-class infrastructure and low political risk. Investment Life Cycle Stage 1 Stage 2 – Funds used for acquisitions – Assets are actively managed and – Portfolio is constructed optimized according to cash-flow and return on capital criteria – Acquisitions continue until PORTFOLIO MANAGEMENT fully invested CAPITAL RAISING EXIT STRATEGIES Liquidity may be one of the following: – Asset sales: Production is sold in the market – Fund sale: For cash, or with investor consent, for securities in another fund – Listing on a public exchange – Redemption 3
    • Why Invest in Oil?J ust as oil and its by-products contribute to your way of life, direct energy investments have been shown to generate competitive returns, diversification and inflation hedging.Competitive Total Returns Non-renewable ResourceDirect oil investments offer the potential for competitive Oil is a non-renewable resource and we appear to havetotal returns. These returns are derived from income along reached the “end of cheap” oil if not the actual peak inwith appreciation in the value of the assets. In general, oil global conventional production.returns have been greater than those on stocks and bondsover the last 40 years. Tangible Real Asset Direct oil investments have intrinsic, real value as productiveInflation Hedge assets. Demand for energy continues to grow consistently.A direct investment in oil has shown that it can helppreserve capital during inflationary periods, because oil hashistorically performed better in times of higher inflation. Forexample, oil prices increased approximately 1,000% duringthe 1970s - the last high inflation period.4
    • Why Invest in Oil?I nvest in oil production to exploit the trend of increasing demand for energy driven by the rapid expansion in the emerging economies combined with peaking supply.China’s Demand China is at the very early stageThe emerging economies, particularly China will be the key of its oil demand growthfuture driver of incremental energy demand. To illustratepotential Chinese demand impact, if you assume Chinamoves from its current consumption level of around 2.5barrels per capita per year to South Korea’s level of 17 bar-rels per capita per year in 30 years, by 2020 we must:– Replace 26 million bbls/day to maintain supply - 30% of current production and almost 3 times Saudi Arabia’s current output– Add 18 million bbls/day to keep up with demand – China: 2 bbls South Korea: 17 bbls US: 24 bbls 22% of current production and almost 2 times Saudi Arabia’s current output. Peak Oil If China and India were to consume Research indicates that the average decline rate of post- resources at the current U.S. per-capita peak fields is at least 6.5% per year and the average decline level, it would require two planet Earths rate of all currently producing fields is at least 4% per year. just to sustain their economies Based on this: – Approximately 3 million bbls/day of capacity must be added each year just to maintain production levels – Approximately 1 million bbls/day must be added each year to meet demand growth – More than 2/3 of existing capacity must be replaced by 2030 just to prevent production declines – A peak in conventional oil production before 2030 appears likely with a significant risk of a peak before 2020 5
    • Why Invest in Oil?T he current oil markets are dramatically different from their 1980s and 1990s counterparts. Supply and demand are much more tightly balanced with a growing challenge to keep up with increasing decline rates. Increasing decline rates mean ever greater production must be found just to keep supply levels constant. Quick Oil Supply Demand Facts 1981 2009 – Global consumption was approximately 69 – Global consumption is approximately 84 million bopd million bopd – OPEC had approximately 10 million bopd of spare – OPEC is estimated to have less than 2-3 production capacity million bopd of spare capacity – China consumed less than 2 million bopd or less – China is the second largest consumer of oil in the than 1 barrel per person per year world – 8 million bopd but still only around 2-3 barrels per person per year – The US consumed 24 barrels per year per person – The US consumes 24 barrels per year per person6
    • Why Invest in Petrocapita?D irect, income generating investments in energy production and related assets are difficult for the average investor to obtain – usually you must invest via the public markets in operating companies which don’t yield income and which have a focus on increasing cash flow via a high degree of risky exploration. Petrocapita is focused on:Reducing Risk Enhancing Income– Acquiring Existing Production: acquisition of – Income: Preferred Trust Units yield a base return of producing assets to create sustainable income 10.25% per annum on invested capital, paid quarterly. distributions plus profit participation for investors; and – Profit Participation: Preferred Trust Units include 10%– Western Canada: a world class energy producing profit participation, as a class, in any other distributions region with excellent infrastructure, low political risk – up to a maximum total return of 12% per annum. and most importantly, competitive acquisition prices. 7
    • 120 Country Hills Landing NW Calgary, Alberta T3K 5P3 Tel: +1.403.218.6506 Fax: +1.403.648.2776 www.petrocapita.comInvestor Rights: If you purchase any securities of Petrocapita Income Trust, (such securities herein referred to as the “Securities”) you will have certain rights in the event of amisrepresentation. Reference should be made to the full text of the applicable provisions of the securities legislation in the Province in which you reside or consultation should beundertaken with professional advisors.If you are subject to the laws of Ontario or Saskatchewan those laws provide, in part, that if there is a misrepresentation in this document, which was a misrepresentation at the timethat you subscribed for Securities, then you will be deemed to have relied upon the misrepresentation and will, as provided below, have a right of action against the issuer of theSecurities (and, in certain instances, other persons) in respect of the Securities purchased by you for damages or, alternatively, while still the owner of any of the Securities purchased, forrescission, in which case, if you elect to exercise the right of rescission, you will have no right of action for damages against the issuer of the Securities, provided that: (1) no person orcompany will be liable if it proves that you purchased the Securities with knowledge of the misrepresentation; (2) in the case of an action for damages, the defendant will not be liablefor all or any portion of the damages that it proves do not represent the depreciation in value of the Securities as a result of the misrepresentation; and (3) in no case will the amountrecoverable in any action exceed the price at which the Securities were purchased by you. In the case of an action for rescission, no action may be commenced more than 180 daysafter the date of the transaction that gave rise to the cause of action. In the case of any action other than an action for rescission, (A) in Ontario no action may be commenced laterthan the earlier of (i) 180 days after you first had knowledge of the facts giving rise to the cause of action, or (ii) three years after the date of the transaction that gave rise to the causeof action, and (B) in Saskatchewan no action may be commenced later than the earlier of (i) one year after you first had knowledge of the facts giving rise to the cause of action; or (ii)six years after the date of the transaction that gave rise to the cause of action. The rights of action described herein are in addition to, and without derogation from, any other right orremedy that you may have at law. There are similar rights provided for in the securities legislation of the Provinces of British Columbia, Alberta and Manitoba and reference should bemade to the full text of the applicable provisions of the securities legislation in those Provinces or consultation should be undertaken with professional advisors.If you subscribe for Securities you have the right to cancel your agreement to purchase the Securities, but to do so you must send a notice to the issuer of the Securities before midnighton the second business day after you sign the subscription agreement to purchase the Securities.Disclaimer: The information, opinions, estimates, projections and other materials contained here in are provided as of December 31, 2009 and are subject to change withoutnotice. Some of the information, opinions, estimates, projections and other materials contained herein have been obtained from numerous sources and Petrocapita Income Trust(“PETROCAPITA”) and its affiliates make every effort to ensure that the contents hereof have been compiled or derived from sources believed to be reliable and to contain informationand opinions which are accurate and complete. However, neither PETROCAPITA nor its affiliates have independently verified or make any representation or warranty, express or implied,in respect thereof, take no responsibility for any errors and omissions which maybe contained herein or accept any liability whatsoever for any loss arising from any use of or relianceon the information, opinions, estimates, projections and other materials contained herein whether relied upon by the recipient or user or any other third party (including, withoutlimitation, any customer of the recipient or user). Information may be available to PETROCAPITA and/or its affiliates that is not reflected herein. The information, opinions, estimates,projections and other materials contained herein are not to be construed as an offer to sell, a solicitation for or an offer to buy, any products or services referenced herein (including,without limitation, any commodities, securities or other financial instruments), nor shall such information, opinions, estimates, projections and other materials be considered asinvestment advice or as a recommendation to enter into any transaction. Additional information is available by contacting PETROCAPITA or its relevant affiliate directly. Petrocapita