All right. Good morning, everybody. I'm Patrick O'Rourke from ATB Cormark Capital Markets. If you aren't familiar with us, we do have a number of colleagues floating around here. We are what we consider to be North America's premier middle market, resource-focused bank with a full suite of products including a broker-dealer, hedging products, lending, underwriting, and advisory. Very happy today. I'm very pleased to introduce Dave Wilson of Kelt Exploration. This is a stock I cover personally and I'm very positive on. Did just over 50,000 BOE per day in the second quarter. We have them doing 56 in 2027, and that might be a little conservative, and on a path to 80. It is a company that's focused in one of the premier North American resource plays at the Montney with three core assets, that being Wembley/Pipestone, Pouce Coupe, and Oak/Flatrock.
One of the other things that's unique about this company, which has about a CAD 2 billion market cap, is that management and insiders own over 18% of the company. And Dave, who's going to present to you today, personally owns about 14%. So I'll hand it over to you, Dave.
Yeah, I think I'm all mic'd up here. Yeah, thanks Patrick. My name's David Wilson, President and CEO of Kelt. Glad to be presenting today at the EnerCom Conference. Kelt Exploration, for those of you who aren't that familiar with the company, we were formed when we spun out a shell out of a previous company. Back in 2013, we sold Celtic to ExxonMobil for CAD 3.2 billion. Part of that deal, we spun out three small properties, non-core properties. One was a 16-section block in the Montney in Karr. There was a small 40% interest in Inga, and then a dry gas property in Grande Cache. The 16-section property we sold for CAD 100 million to a private company in 2017. And then in 2020, we sold the Inga property after we consolidated to 100%. We sold that to ConocoPhillips for a half a billion.
Right now, we've got 359,000 acres of Montney acreage all in the oily part of the Montney fairway. That was one of the things that we wanted to do was we wanted to get higher up into the Montney fairway where it was oilier and more liquids. We were able to do that. And then we also tied up 93,000 acres of Charlie Lake rights, and that's been a very good play for us as well. While doing this, while tying up all this land, we still ended up with a 1.7x recycle ratio. And part of that was due to the fact that we were able to tie these lands up at very inexpensive prices because we did it during a pretty good downturn in 2015 and 2016. So this gives you an idea where we're located.
Oak/Flatrock in B.C., and you just come across the border into Pouce Coupe/Progress, and then down into Wembley/Pipestone. Right now our market cap's about CAD 2 billion. We've got just over 200 million shares outstanding and, as Patrick O'Rourke said, insiders do own a big chunk, 18% basic, 20% fully diluted. The good thing about that was we didn't get this stock by getting it given to us when we started the company. We actually participated in every equity financing that we did. We did some financings right up until 2019. Then we have bought 48.7 million in the open market as well. Our CapEx this year, we've got a CAD 375 million CapEx, and the significance of our CapEx this year is how much is going into drilling and completions.
You could see that almost 75% of that CapEx goes into drilling and completions this year, which obviously goes directly into production. The reason for that is over the history of the company, we've spent a lot of money on land and infrastructure, but we're finally to the point where most of that money actually goes into the drill bit. Last year we did do a big 3D seismic program in Inga where we shot about 110 sections of 3D seismic. Our drilling completions program this year, we're drilling 32.5 net wells in Alberta and then four net wells in B.C. for a total of 36.5 wells. We are completing four additional wells, so two in B.C. and two in Alberta that were DUCs that we brought into the year. So we do a total of 40.7 this year.
Lots of production and most of that's coming on in this last half of the year. We are a growth company. We don't pay a dividend. We don't buy back stock, but we grow. We feel with our inventory, that's the best use of the money we can have is to actually put it back into the ground. In 2024, we grew 9%, 2025 grew 22%, and this year we're projecting we'll grow 26%. The question, I guess, is can you do that on a go-forward basis? This slide shows you our processing that we've got lined up over the next few years. We've went ahead and set up our plan to grow into the future. You can see right up to 2030, we continue to add processing capabilities.
With that sort of gas processing capability, we should be in that 80,000 - 85,000 BOE a day range in 2030. That's without adding more. We're actually looking at adding some more in 2027 and 2028 in our Wembley/Pipestone property. This slide's getting a little bit dated. It's a reserve slide back from the end of 2025. The one thing to take away from this is the Proved plus Probable number is CAD 3.3 billion. The reason that's significant, the last two M&A deals that were done right around us, Shell buying ARC Resources, and then Canadian Natural Resources buying the Charlie Lake assets off of Tamarack Valley Energy, they were both done at a valuation of Proved plus Probable. Where does that leave us?
Well, if you do a Net Asset Value per share calculation, you take your Proved plus Probable, add a little bit for land, take off your debt. It puts us at about CAD 15.62. Now, keep in mind, this was last year, and oil prices back then were being run at CAD 60 . That should be significantly higher here this year. Then we will have grown by 26%. I think suffice to say our Proved plus Probable number should be somewhat higher than what you are seeing here. I am not going to get too in the weeds on this slide. It just shows you the different hubs, different areas that we are receiving our commodity prices for. The one thing to take away from this is we are fairly diversified on the gas side.
We still have a fair amount of AECO and Station 2 in the portfolio, but we have Dawn, Chicago, Sumas and Marcellus. We have also hedged some gas so that we actually get a netback from TTF and JKM and only have to deliver to AECO on that. That is a hedge that is not on here. What we ran this year for our budget was CAD 79.50 for oil. Keep in mind, last year we or not last year, but the first half was averaged CAD 82.50 . We run at CAD 76.50 go forward for the rest of the year. We should be around CAD 80 for the first two months of that period. We ran quite a low gas price for AECO and Station 2.
Having said that, we do think that AECO and Station 2 will probably get a pretty good bump here come October and November. The one thing I should just mention, the one thing that we have seen here this year as a result of the war is we have seen some pretty significant sulfur pricing. We are getting somewhere between CAD 1,200 and CAD 1,300 Canadian netback for sulfur we produce. We are producing about 100 - 120 tons a day. That was something that was just pretty much given away before, and now we are seeing some big realized prices on sulfur. From this netback slide, I think the one thing to take away from it is royalties here are not what a lot of the U.S. guys are used to.
A lot of the U.S. players are in that 20%-25% range. We run at 10%-12% and should continue in that area. We get a really nice royalty holiday on our new production, and that helps bring that down. Transportation expense of about three and a quarter, that should be consistent go forward. Then about CAD 10 production expense. That should drop as we bring on a bunch of this new production. The other two areas that we have a bit of advantage on is G&A and interest. We keep G&A below a buck, and interest here this year is going to be CAD 0.64. This year we're going to end up with cash flow of about CAD 21.33 per BOE. From a financial summary standpoint here, about CAD 804 million of sales, and that turns into CAD 410 of cash flow, and just shy of CAD 2 per share.
Now, that's on a CapEx of CAD 375 million. We'll be paying back debt of about CAD 35 million, and brings us down to 0.4 x debt to cash flow. We are paying back debt even though we're growing 26% this year. Just jumping into the operations part of the presentation. You could see Oak over on the left-hand side. That's in B.C. Jump over the border into Alberta and you get into Pouce Coupe/Progress, and then down into Wembley/Pipestone. So those are the three divisions. Oak is in a wholly owned subsidiary called Kelt Exploration (LNG) Ltd., and then Pouce Coupe and Wembley are held in the parent company. The reason we do that is it just makes, in the future, if we want to sell a division, it makes it very tax effective.
We do have CAD 1 billion of PUC, Paid-Up Capital, which allows you to do a return of capital to a shareholder if you sell a full division. We've set this up so that we don't have to sell the whole company. We can sell pieces if we need to. The other thing here, as I'd mentioned previously, we own 561 sections of Montney lands, 146 sections of Charlie Lake, and a total of 940, including some Halfway and Baldonnel and Cretaceous zones. This slide gives you a real good idea why the Montney is a very coveted play by industry. Just like the Permian, it's very thick. That interval's over on the left-hand side is about over 1,000 feet thick, and you have all these different intervals within that Montney, and you're able to go in there and develop them separately.
In some cases, in Pouce Coupe, there's actually five zones that we've completed. In Wembley right now, we're completing three different zones, so it's a real multiplier on your land base and it makes for very efficient completion and production operations. Thus, the little table in the bottom, I think the main thing to take away from that is the Montney's quite over-pressured, and that's one of the reasons you get good productivity. Here's the production from our operating divisions. Keep in mind, this was last year in 2025. Pouce Coupe, we're doing 17,758 for the year, 14,885 for Wembley, and Oak, 6,378 BOEs. This year, not for the average for the year, but by year-end, we should be up to 20,000 BOEs at Pouce Coupe, and we should be bouncing off of 30,000 BOEs in Wembley/Pipestone.
Big adds there, and then we'll be up around 9,000 in Oak/Flatrock. Some real good production adds here coming, a lot of them in the last half of this year. Another reason the Montney's a very well-liked play in Canada, cost. You see some pretty high costs on a lot of these horizontal plays. Here we've ran CAD 7.4 million for a Wembley well. The wells we've drilled so far and completed have actually come in less than CAD 7 million. But even if you use CAD 7.4 million and compare that to a Permian, it's still about 40% less than what they're paying in the Permian.
Now, the last two pads that we just brought on, well, I guess the first two pads of the year in Wembley, they came on at 1,000 BOEs a day, or over 1,000 BOEs a day and 60%-70% oil and liquids. Very similar productivity to a Permian, and you can drill and complete them quite a bit cheaper. This is with our new completion formula. We've added sand and reduced spacing a bit. We're doing 2.75 tons per meter of sand and increased our water up to four cubes per meter. You can see we've got a big drilling inventory here, 854 wells. Then if you go over to the Montney well, that's actually a three-miler. We're drilling those for CAD 7.3 million, three miles, and completing them and having real good efficiencies there.
It just drills a little quicker over in B.C. on this play. You can see there, we've only got about 16% of our inventory booked. The other play that we've got is the Charlie Lake, and it's every bit as economic as the oily Montney. Cheaper inputs, CAD 4.8 million to drill and complete, and again, this is on a two-mile well. You can see at the bottom it's very oily, 55% on a EUR basis. Oh, I went backwards here. In this Oak division, this is our biggest acreage. We've got just under 300 net sections. We are only drilling four wells here this year, or we have drilled four wells this year and completed six. There were two DUCs here. The reason for that is just gas prices.
This is a little gasier than our other two plays, so we moved money out of Oak into Wembley and Pouce Coupe to take advantage of the oil pricing here this year. Next year we will drill 12-15 wells here. Like I said, this is where we're drilling three-mile horizontals. Alberta Montney lands. This is both divisions, Pouce Coupe in the top, Wembley at the bottom. We've got a total of 259 sections of Montney lands here. It's all in that oily window with the exception of there's one zone in that Pouce Coupe west block that is drier gas. This is just the Pouce Coupe/Progress division in the Montney. It doesn't look like a very contiguous block here, but when I show you in the next slide with the Charlie Lake play on it layers over this and makes it a contiguous block.
Here we drilled four wells this year, completed five in the Montney. We had one DUC we brought in from last year, and we also completed a Halfway well that we're just bringing on production here right now. This is the Charlie Lake slide. Like I say, if you layer this over the Montney, it becomes a much more contiguous block. What's good about that is we're able to produce and complete both zones into the same infrastructure. It's very efficient from that standpoint. There's lots of these areas where you're drilling actually three different plays from the same pad, a Montney, a Charlie Lake and say a Halfway. What we're doing here this year is we're drilling and completing eight wells, 6.5 net.
This was one of the areas we brought in some of the money from Oak and spent here just because this is a very oily play. Wembley/Pipestone is our flagship, or is our key play, flagship play. It is 190 net sections, and like I said before, we are completing three different intervals in this play. What we did here was we went in right from the start and did a full delineation of the block. You can see some single wells there, just so we understood what we had for productivity and were able to size our infrastructure accordingly. Right now, this year we are drilling 21 wells. We have got a DUC we have brought in, so we will complete 22. Big production add coming here in Wembley/Pipestone and this will continue to be a real growth engine for the company.
As far as the infrastructure, I said we delineated this really well, so we understood the infrastructure. We have went in, built the batteries. We have got four big batteries and compression facilities. We have got five water injectors, a big 1.2-million barrel water pit for completions, and all the pipe in the ground is big diameter. We have actually got three pipes in most of the ditches. So we are set for the next couple decades to go in here and develop this or somebody else if we end up selling it. With Kelt, we have got a big inventory. We are very long inventory, 30, 40 years of inventory here, and that is in the Montney and Charlie Lake. We are one of the last companies standing there as far as oily Montney that is not planning to be around 10 years from now.
We are planning to do a divestiture of at least one of the divisions, if not two or the company at some point. We have always said that we were building this company to sell and we want to bring some of that Net Asset Value forward that we have got 20 years out into the future. The balance sheet is in great shape, about 0.4x debt to cash flow. That sums up the presentation. Looks like I am getting close to the end here. I do not know if we have got time for questions or not.
Questions during the breakout.
Okay, perfect. Anybody want to ask questions, I will be in the breakout room. Thank you.