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INVESTOR PRESENTATION – Magnum Hunter Resources Corp.

Magnum Hunter Resources Corp. · May 5, 2014 · 56 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 1
    MAGNUM HUNTER RESOURCES CORPORATION Investor Presentation May 2014
  2. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 2
    Who We Are Magnum Hunter Resources is an exploration and production company focused in three of the most prolific unconventional resource shale plays in North America; the Marcellus, Utica and Williston/Bakken Shale Current management…
  3. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 3
    Where We Operate A well-balanced and concentrated asset base in large shale plays Secure footholds in West Virginia, Ohio, Kentucky, and North Dakota 152,000 Net Acres Williston Basin 79,000 Net Bakken / Three Forks Sanish…
  4. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 4
    Production Growth 2013 Production increased 92% to 14,831 Boepd(1) compared to 7,739 Boepd in 2012 Year-end 2014 exit rate guidance of 35,000 Boepd(2) (2) 35,000 14,831 7,739 4,895 1,276 (1) (2) 2010 2011 2012 2013…
  5. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 5
    Proved Reserve Growth Consistency Track record of proved reserve growth since inception Approximately 75.9 MMBoe of proved reserves at December 31, 2013 (45.8% oil/liquids) Anticipate continuing to consistently add proven reserves with…
  6. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 6
    Proved Reserves Summary Proved Reserves Summary(1) Net Proved Reserves as of December 31, 2013 (SEC PRICING) Liquids Gas Total Category (MMBbls) (Bcf) (MMBoe) % PDP 16.8 136.7 39.6 52.2% PDNP 2.2 39.9 8.9 11.7% PUD 15.7 70.2 27.4…
  7. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 7
    3P Reserves & Contingent Resources Summary 3P reserves and contingent resource potential of 848 MMBoe Extensive inventory of low-risk development drilling locations in the Williston Basin and Marcellus Shale Significant exploration…
  8. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 8
    Growth Plan Continues(1) EBITDAX Revenue 300 280.4 250 200 ( MM) 150 140.4 112.4 100 76.2 66.5 50.4 50 28.6 5.4 6.8 4.2 0 2009 2010 2011 2012 2013 * See Appendix of this presentation for a non-GAAP…
  9. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 9
    Breakdown of Capital Expenditure Budgets 2013 Drilling and Completion Capital Expenditures 2014 Capital Budget Appalachia Williston Eureka Hunter Eagle Ford/Other Appalachia Williston Eureka Hunter 10% 23% 34% 22% 13%…
  10. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 10
    Substantial Leasehold Inventory Developed Undeveloped (1) (2) As of January 31, 2014 Acreage Acreage Total Acreage Gross Net Gross Net Gross Net (3) Appalachian Basin Marcellus Shale 60,363 59,710 23,620 18,999 83,984 78,709 Utica…
  11. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 11
    Future Growth and Profitability Drivers To achieve consistent growth, we are committed to the following: Focus on developing and growing core assets in areas with the highest rate of return using our proven development expertise…
  12. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 12
    Williston Basin Division 12
  13. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 13
    Williston Basin Overview Areas of Operation Overview Proved Reserves Total proved reserves of 20.8 MMBoe as of 12/31/13 Proved producing reserves of 9.1 MMBoe as of 12/31/13 Acreage 152,000 net acres in the Williston Basin…
  14. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 14
    Ambrose/Divide County 2014 Activity Areas of Operation Overview 2014 Ambrose Field Drilling Program 15-20 gross (6-8 net) wells Targeting Three Forks Sanish and Middle Bakken Prolific Two-mile Lateral Wells IP 24-hour rates - 800…
  15. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 15
    Williston Basin Recent North Dakota Well Results Williston (North Dakota) MHR results 1,800 24-Hour IP Rates 30-Day IP Rates of Frac Stages 1,582 1,600 1,400 1,200 1,001 968 1,000 947 BOE 906 845 893 874 825 809…
  16. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 16
    Williston Basin Economics Sensitivity North Dakota West (High Case) North Dakota West (Base Case) CAPEX: 6.4 million per well CAPEX: 6.4 million per well EUR: 550 MBOE EUR: 350 MBOE Differential: (8) Differential: (8) North Dakota -…
  17. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 17
    Appalachian Division 17
  18. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 18
    Appalachian Division Overview Overview Areas of Operation Proved Reserves MHR areas of operations Total proved reserves of 53.4 MMBoe as of 12/31/13 Proved producing reserves of 30.2 MMBoe as of 12/31/13 Acreage Position…
  19. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 19
    Marcellus Shale Recent Well Results Marcellus Operated Well Results 24-Hour IP Rates 30-Day IP Rates of Frac Stages 14,000 12,854 12,832 12,670 12,421 12,000 10,340 10,013 10,000 9,543 8,842 8,560 8,412 8,000 6,000…
  20. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 20
    NGL Uplift in Appalachia Following the startup of the Mobley Processing Plant in December 2012, Magnum Hunter has realized an uplift in NGLs on a per wellhead Mcf basis between 0.75 - 1.25 The Company has 200 MMcf/d of dedicated…
  21. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 21
    Economic Sensitivity of Marcellus Magnum Rich High Case: Base Case: CAPEX: 6.5 million per well CAPEX: 6.5 million per well EUR: 11.7 Bcfe (includes NGL) EUR: 7.8 Bcfe (includes NGLs) High Case Base Case 18 IRR: 105% 16 IRR:…
  22. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 22
    Marcellus Shale Note: MHR owns approximately 79,000 net acres in the Marcellus Shale. 22
  23. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 23
    Utica Shale Overview The Utica Shale extends approximately 170,000 square miles throughout the Appalachia Total Organic Carbon Basin in the United States and Canada Ordovician-aged organic rich black shale with interbedded limestone…
  24. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 24
    Potentially Best Shale Play in US Shale Play Comparison Chart Ohio / West Va. / Penn. Wyoming/Colorado Texas N. Dakota Utica Shale / Parameter Point Pleasant DJ Basin Niobrara Eagle Ford Bakken Lithology Calcareous Shale Chalk/marl…
  25. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 25
    Major Players in the Utica: Who They Are Company Ticker Net Acres EV (MM) Acres/EV Chesapeake Energy CHK 1,000,000 34,063 29 Chevron CVX 600,000 233,468 3 Anadarko Petroleum APC 267,000 57,360 5 Devon Energy DVN 195,000 30,153 6…
  26. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 26
    Most Leveraged to the Utica 70 64 60 50 40 37 30 29 29 29 19 Average: 15 20 15 12 10 7 7 6 6 6 5 3 1 0 Net Utica Acres / Enterprise Value Source: Company presentations, Bloomberg, state data, Baird 26
  27. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 27
    Utica Asset Transactions Announced Total Transaction Implied Date Buyer(s) Seller(s) Value (MM) Acreage / Acre Feb-14 GPOR Rhino 185 8,200 22,561 Jan-14 American Energy Partners, LP Paloma Partners 442 26,000 17,000 Jan-14 American…
  28. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 28
    Farley Pad Drilling Locations First Utica horizontal well in Washington County spud April 10, 2013 Farley Pad is designed to handle 10 horizontal wells A vertical pilot, and subsequent horizontal well was drilled, logged, cored,…
  29. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 29
    Stalder Pad Drilling Locations Magnum Hunter announced the initial production results from the first Utica horizontal well on the MHR - Stalder 3UH 32.5 MMCF 97% Methane Stalder Pad on 2/14/14 Tested at a peak rate of 32.5 MMCF of…
  30. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 30
    Steward-Winland Pad Drilling Locations The Stewart-Winland Pad has Tyler County, West Virginia seven planned laterals Magnum Hunter Acreage Four wells will be drilled on MHR / JV Partner Acreage the North Unit (3 Marcellus Marcellus…
  31. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 31
    Utica Shale Recent Well Results Antero Myron 3H MUSKINGUM Antero Wayne 2H Antero Wayne 3HA Antero Wayne 4H Frac In Progress 1331 bbls/d + 1503 bbls NGL/d 1905 bbls/d + 2018 bbls NGL/d 1922 bbls/d + 1907 bbls NGL/d Waiting On…
  32. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 32
    New Marcellus/Utica Production Driving Exit- Rate Production (2) (2) MHR Working MHR Net Estimated Gross Production Estimated Net Production Anticipated (1) Well Name Location Interest Revenue Interest Boe/d (3) Mcfe/d Boe/d (3)…
  33. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 33
    Eureka Hunter Midstream 33
  34. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 34
    Eureka Hunter Midstream Overview Strategically Positioned Assets In the heart of Wet Marcellus WV and Dry Utica of eastern Ohio 100 miles of primarily 20 1135 MAOP gathering system currently in the ground Assets and Business 350+ MMcf…
  35. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 35
    Contracted vs. Gathered Volumes Eureka Hunter Pipeline 2012 Avg. Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 High Pressure Reservation Volume (MMBtu/d) Magnum Hunter 40,000 87,950 87,950 87,950…
  36. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 36
    Near-term Estimated Incremental Volumes Producer / Area State Rich/Dry Line Segment Jan '14 Feb '14 Mar '14 Apr '14 Q3 Triad Hunter - Collins WV Rich Pursley Lateral 15,000 12,000 12,000 10,000 8,000 Triad Hunter / Stone Pad 3 & 6 WV…
  37. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 37
    Eureka Projected Throughput Mmbtu/day 1,400,000 1,200,000 1,000,000 1 BCF / DAY Producer 7 800,000 Producer 6 Producer 5 600,000 Producer 4 Producer 3 500,000 Producer 2 400,000 Producer 1 200,000 0…
  38. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 38
    Eureka Hunter Utica Exposure MARSHALL Clairington MarkWest Hub Seneca Blue Racer Berne Blue Racer Natrium Ormet Wells NOBLE MONROE PENN W.V. Farley Units Stalder Units WETZEL MORGAN MarkWest Dominion Mobley Eureka…
  39. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 39
    Eureka Hunter Pipeline - Construction Challenging Terrain Welding Up Pipeline Strung Pipe Before Connection Being Lowered 39
  40. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 40
    TransTex Hunter Amine Plants TransTex Hunter, LLC (TransTex) founded in 2006; acquired by Eureka Hunter in April 2012 Design and fabricate gas treating plants for natural gas production Assets for gas treating, processing,…
  41. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 41
    TransTex Hunter Amine Plants 41
  42. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 42
    Alpha Hunter Drilling 42
  43. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 43
    Drilling Company Overview Wholly-owned subsidiary of Magnum Hunter Resources Corporation Current fleet of six (6) drilling rigs consisting of: One (1) Schramm TXD 500 Rig 7 o Spud first well (Stalder Pad) on July 1, 2013 o Contract…
  44. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 44
    Alpha Hunter T500XD Rig The Schramm T500XD is a new state of the art robotic drilling rig Took initial delivery in May 2013 Working exclusively for Triad Hunter Currently drilling the Stewart- Winland pad first horizontal Utica well…
  45. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 45
    Alpha Hunter Growth Continues 20 18 16 Revenues ( in millions) 14 12 10 8 6 4 2 0 2010 2011 2012 2013 Revenues 45
  46. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 46
    Alpha Hunter Experience Company of Wells Drilled Bretagne 1 CNX Gas 8 Consol 3 Central WV Oil & Gas 1 Dominion 34 Eagle Ford Hunter 15 Eclipse 9 EQT 165 EXCO Resources 57 Green Hunter Water 4 Hildreth 7 PetroEdge 1 Rex…
  47. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 47
    Financial Overview 47
  48. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 48
    Financial Strategy Capital spending driven by rates of return across all operating areas Focus on development of existing acreage in our core areas 2014 capital budget will focus predominately on high return areas in the Appalachian…
  49. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 49
    Capitalization Capitalization ( in millions) 2013 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter Cash and Cash Equivalents 91.2 32.7 55.3 41.7 Revolving Credit Facility due 2016 325.0 0.0 90.0 218.0 Senior Unsecured Notes due…
  50. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 50
    Adjusted EBITDAX Reconciliation Adjusted EBITDAX Reconciliation ( in Millions) FYE 2009 FYE 2010 FYE 2010 FYE 2012 FYE 2013 Net income (loss) from continuing operations ( 15.1) ( 22.3) ( 76.7) ( 119.7) ( 204.1) Unrealized (gain) loss…
  51. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 51
    Non-Core Divestiture Summary Aggressively pursuing additional non-core asset sales to enhance our financial flexibility to focus capital on higher return projects Non-Core Asset Sales Value (MM) Completed in 2013 Eagle Ford Sale…
  52. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 52
    Crude Oil and Natural Gas Hedges Crude Oil 2014 2015 2016 NYMEX Average (1) 97.30 90.66 85.46 Weighted-Average Hedge Price With Ceilings 100.90 115.93 - Weighted-Average Hedge Price With Floors 85.00 85.00 - Weighted-Average…
  53. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 53
    MHR Net Asset Value* Assumptions Valuation ( in thousands) Low High Low High (1) Total Proved Reserves PV-10 (12/31/2013) 922,100 922,100 /acre (2) Undeveloped Acreage Low High Williston Basin U.S. 50,100 3,000 5,000 150,300…
  54. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 54
    A Focused Company on the Right Path Proven management and technical team in place committed to proper capital allocation for future growth Geographically diversified asset base in three of the most prolific shale plays in the US…
  55. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 55
    Equity Research Coverage / Contact Information Magnum Hunter Resources (NYSE: MHR) Equity Research Analyst Coverage: BMO Capital Markets RBC Capital Markets Canaccord Genuity Robert W. Baird & Co. Capital One Southcoast Stephens…
  56. INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 56
    Appendix Net Asset Value Although Magnum Hunter does not consider Net Asset Value and Net Asset Value Per Share to be non-GAAP financial measures, as defined in SEC rules, Magnum Hunter uses Net Asset Value as an estimate of fair value.…

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