The Fortify Strategy

A relentless focus on increasing value

The Fortify Energy strategy is to maximize returns through efficiency that creates value. The Fortify team has a track record of consistently improving operating margins by combining production enhancements and cost reductions.

Oilfield, pumpjack, Saskatchewan, Canada.
01

Acquire

We acquire proven properties at attractive prices where we see a “value gap” in which our technical and operational efficiencies can improve profitability.

Conventional, low-decline asset base

Focus on vertical wells with stable PDP decline rates that support consistency in value and cash flow.

Openness to complex valuation scenarios

As an affiliate of the special-situations asset manager Arena Investors, we are comfortable assessing potential acquisitions whose value may not be immediately obvious.

Multiple deal-flow sources

Beyond marketed deals, Fortify can access transactions through extensive relationships in the industry and direct absorption of assets from investment funds.

Oilfield, pumpjack, Saskatchewan, Canada.
02

Optimize

We optimize each acquired property with a relentless focus on value across all aspects: technical, commercial, and operational.

Production technique

Cost-efficient technical improvements may include exploiting shut-in wells, new zone completion, eliminating facility bottlenecks, right-sizing compression, and many others.

Personnel, equipment, facilities

The field team may be adjusted to represent an efficient mix of expertise; vehicles, field equipment, offices, etc. will be right-sized for the asset and asset plan.

Vendors and marketing

Contracts are assessed and renegotiated or replaced when advantageous and possible.

Oilfield, pumpjack, Saskatchewan, Canada.
03

Realize

Optimization is never finished and encompasses our central overhead and financial operations as well. We continually work to increase additive cash flow.

Lean “barbell” team structure

We use a centralized management team and local operators with significant knowledge of the assets—eliminating the need for middle management.

Commodity hedging and low leverage

Hedging reduces price-decline risk and increases cash-flow stability. Conservative debt levels preserve financial security and flexibility.

Opportunity re-analysis

Plans and performance for each asset are re-evaluated frequently. Activities are fine-tuned, and new opportunities are seized.

The Fortify Energy strategy is to maximize returns through efficiency that creates value. The Fortify team has a track record of consistently improving operating margins by combining production enhancements and cost reductions.

The 3-Phase Fortify Strategy:
Acquire, Optimize, Realize

01

Oilfield, pumpjack, Saskatchewan, Canada.
01

Acquire

We acquire proven properties at attractive prices where we see a “value gap” in which our technical and operational efficiencies can improve profitability.

02

Oilfield, pumpjack, Saskatchewan, Canada.
02

Optimize

We optimize each acquired property with a relentless focus on value across all aspects: technical, commercial, and operational.

03

Oilfield, pumpjack, Saskatchewan, Canada.
03

Realize

Optimization is never finished and encompasses our central overhead and financial operations as well. We continually work to increase additive cash flow.

01

Oilfield, pumpjack, Saskatchewan, Canada.
01

Acquire

We acquire proven properties at attractive prices where we see a “value gap” in which our technical and operational efficiencies can improve profitability.

02

Oilfield, pumpjack, Saskatchewan, Canada.
02

Optimize

We optimize each acquired property with a relentless focus on value across all aspects: technical, commercial, and operational.

03

Oilfield, pumpjack, Saskatchewan, Canada.
03

Realize

Optimization is never finished and encompasses our central overhead and financial operations as well. We continually work to increase additive cash flow.

Conventional, low-decline asset base

Focus on vertical wells with stable PDP decline rates that support consistency in value and cash flow.

Openness to complex valuation scenarios

As an affiliate of the special-situations asset manager Arena Investors, we are comfortable assessing potential acquisitions whose value may not be immediately obvious.

Multiple deal-flow sources

Beyond marketed deals, Fortify can access transactions through extensive relationships in the industry and direct absorption of assets from investment funds.

Production technique

Cost-efficient technical improvements may include exploiting shut-in wells, new zone completion, eliminating facility bottlenecks, right-sizing compression, and many others.

Personnel, equipment, facilities

The field team may be adjusted to represent an efficient mix of expertise; vehicles, field equipment, offices, etc. will be right-sized for the asset and asset plan.

Vendors and marketing

Contracts are assessed and renegotiated or replaced when advantageous and possible.

Lean “barbell” team structure

We use a centralized management team and local operators with significant knowledge of the assets—eliminating the need for middle management.

Commodity hedging and low leverage

Hedging reduces price-decline risk and increases cash-flow stability. Conservative debt levels preserve financial security and flexibility.

Opportunity re-analysis

Plans and performance for each asset are re-evaluated frequently. Activities are fine-tuned, and new opportunities are seized.

Our Approach Reduces Risk Oil & Gas Development Risk Spectrum

Our costs are consistently lower

15%

LOWER

General and Administrative cost per unit of energy produced*

14%

LOWER

Lease Operating Expense per unit of energy produced*

*Fortify costs vs. peer group average. Comparison group includes BATL, AMPY, REXP, REI, and EPM, based on recent investor presentations.

CASE STUDY

South Louisiana

24,000 net acres, 75 wells

Assumed management: October 2019

Production increase year one: 10%

Operating expense decrease to date: 20%

Cash flow change:

From initial $200K to $900K/mo.

Cash flow change: From initial $200K to $900K/mo.

CASE STUDY

Gulf Coast

18,000 net acres, 75 wells

Assumed management: January 2022

2,300 MCFE/D

Idle production brought back online via compressor and barge repair

Cash flow change:

From initial $100K to > $500K/mo.

Cash flow change: From initial $100K to > $500K/mo.