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MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp.

Magnum Hunter Resources Corp. · Mar 1, 2012 · 51 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. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 1
    MAGNUM HUNTER RESOURCES CORPORATION Corporate Presentation March 2012
  2. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 2
    Corporate Overview Market Capitalization 900 MM Enterprise Value 1,300 MM Net Debt/Total Cap 28% YE 2011 Exit Rate 12,500 BOE/D YE 2012 Exit Rate (Est.) 16,000 BOE/D Proved Reserves 45 MMBOE Resource Potential 538 MMBOE…
  3. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 3
    Executive Summary Magnum Hunter Resources is focused exclusively on three of the most prolific unconventional resource plays in the United States: South Texas Eagle Ford Shale Appalachia Marcellus Shale / Utica / Huron / Weir North…
  4. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 4
    Current Portfolio Overview Focused exclusively on three unconventional resource plays 69,299 Net Acres 58,426 Net Marcellus Acres 61,151 Net Utica Shale Acres 313,000 Net Southern Appalachia Acres 24,000 Net Acres…
  5. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 5
    IRRs of Top U.S. Shale Plays MHR Active Resource Plays 60% 51% 50% 47% 40% 34% 34% 30% 25% 25% 23% 22% 20% 19% 20% 18% 16% 16% 14% 14% 13% 11% 10% 8% 7% 7% 5% 2% 0% Year: 1 2 3 4 5 6 7 8+ WTI Oil: 93.18 87.55…
  6. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 6
    2012 Capital Expenditure Budget 2012 Capital Budget - 200 Million (Preliminary) Appalachia Williston Basin 50 mm 50 mm 25% 25% 50 mm 50 mm 25% 25% (i) Eagle Ford Eureka Hunter Note: Magnum Hunter currently operates over…
  7. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 7
    Projected Production Growth 18,000 Natural Gas Oil / Liquids Shut-in 16,000 16,000 14,000 12,500 12,000 10,000 Boe/d 9,124 8,000 5,747 6,020 6,000 (2) (1) 5,270 4,947 4,000 2,269 2,000 0 1Q11A…
  8. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 8
    Platform for Continued Growth December 31, 2011* December 31, 2011* Proved Reserves: 44.9 Mmboe Proved Reserves by Region 48% Oil / Liquids Eagle Ford PDP PUD 13.7% 46.1% 50.9% 66.6% 19.7% Appalachia Williston Basin 3%…
  9. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 9
    Proved Reserve Growth Proved Reserves Proved Reserves / Share (1) 50.0 0.45 44.9 0.40 0.40 Proved Reserves (Boe) / Share Proved Reserves (MMBoe) 40.0 0.35 0.30 30.0 0.25 0.21 0.20 0.16 20.0 13.4 0.15 0.10 0.08…
  10. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 10
    Williston Basin 11
  11. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 11
    Williston Hunter Overview (1) Total proved reserves of 8.9 MMBoe as of December 31, 2011 Proved Reserves Proved producing reserves of 3.8 MMBoe as of December 31, 2011 90% crude oil Production 90% from the Williston Basin Over…
  12. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 12
    Williston Hunter Areas of Operation 75% Avg. WI 10% Avg. WI 30% Avg. WI 50% Avg. WI Acquired NuLoch MHR Existing Assets Assets 13
  13. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 13
    Williston Hunter Recent Well Results IP7 IP30 IP60 7 Day 30 Day 60 Day MHR Lateral Frac IP24hr Average Average Average First Well County W.I.% Length Stages Zone boepd boepd boepd boepd Production North Dakota Mustang 7-6-163-98…
  14. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 14
    Williston Hunter North Dakota Bakken / TFS - Gross Production Data 7000 6000 5000 Oil Rate BOPD 4000 3000 2000 1000 0 15
  15. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 15
    Williston Hunter Tableland, SK Bakken / TFS - Gross Production Data 1D16-16-1C13-16-1-10 2C12-2-1C12-3-1-11 3D1-10-3D1-11-1-10 1D1-15-3A1-14-1-10 2B13-11-2A16-11-1-10 3B4-28-3A1-28-1-10 2C13-2-2D16-2-1-10 4A8-16-3A5-16-1-10…
  16. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 16
    Williston Basin Economics Sensitivity North Dakota (2 mile lateral) Saskatchewan (1 mile lateral) North Dakota (2 mile lateral) CAPEX: 6.9 Million CAPEX: 3.4 Million IP-24 Hour: 550 Bbl/D IP-24 Hour: 250 Bbl/D Saskatchewan (1 mile…
  17. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 17
    Eagle Ford Shale 18
  18. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 18
    Eagle Ford Hunter Overview (1) Total proved reserves of 6.2 MMBoe as of December 31, 2011 Proved Reserves Proved producing reserves of 1.5 MMBoe as of December 31, 2011 85% crude oil, with high btu gas (+1350) Production 16…
  19. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 19
    Eagle Ford Shale Oil Window MHR currently holds over 23,500 net acres in the Eagle Ford Shale core Majority of the acreage position is in the Gonzales County oil window Strong well results by offset operators MHR: Oryx Hunter 1H…
  20. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 20
    Eagle Ford Hunter - Operations MHR Lateral Stages IP Rate (Boe/d) First Well County Operator Interest Length Fraced 24-hour 7-day 30-day Production MHR Operated (Gonzales/Lavaca County): Gonzo Hunter 1H Gonzales MHR 50% 4,365 9 of 11 605…
  21. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 21
    Eagle Ford Hunter Gross Production Gonzo Hunter 1H Lagunillas 2H Lagunillas 1H Southern Hunter 1H Gonzo North 1H Cinco 2H Cinco 1H Furrh 1H Geo Hunter 1H Oryx Hunter 1H Sable Hunter 1H Furrh 2H Kudu Hunter 1H Snipe Hunter 1H Leopard…
  22. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 22
    Economic Sensitivity of Eagle Ford Gonzales County High Case: Mid Case: Low Case: Capex: 8.8MM + 0.3MM (ESP) + .02MM PU Capex: 8.5MM + 0.3MM (ESP) + .02MM PU Capex: 8.0MM + .03MM PU IP-24 Hour: 1,750 Boepd IP-24 Hour: 1,250 Boepd IP-24…
  23. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 23
    Appalachia 24
  24. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 24
    Appalachia Overview Magnum Hunters Appalachia assets are a combination of multiple acquisitions Magnum Hunter has completed over the past year and a half including Triad, NGAS, PostRock, and Windsor. (1) Total proved reserves of…
  25. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 25
    Appalachia Areas of Operation Primary focus on liquids rich Marcellus gas in northwest West Virginia Triad Hunter NGAS Hunter The Marcellus is one of the most attractive shale plays in the United States Ohio The Marcellus has one…
  26. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 26
    Triad Hunter Liquids Rich Marcellus Shale Pennsylvania Ohio Marcellus Properties / Operations: 58,426 Net Marcellus Acres To-date thirteen wells have been drilled and completed Seven wells in Tyler County, WV Five wells in Wetzel…
  27. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 27
    Marcellus Operations MHR Lateral Frac IP Rate (mcfe/d) First Well County Operator Interest Length Stages 24 Hour 7-day 30-day Production Weese 1H Tyler MHR 100% 3,550 12 7,210 4,559 4,205 12/31/2010 Weese 3H Tyler MHR 100% 3,030 12…
  28. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 28
    Triad Hunter Gross Marcellus Production Weese 1001 Weese 1003 Ormet 1-9H (1) Stone Unit 2 - 2H Stone Unit 3 - 5H WVDNR 1102 WVDNR 1103 WVDNR 1104 WEESE 1110 E WEESE 1107 E WEESE 1108 E WEESE 1109 60,000 50,000 40,000…
  29. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 29
    MHR / Stone Energy Joint Venture Joint Venture Overview: 1,925 acres located in Wetzel County, WV 19 horizontal wells to be drilled on JV acreage over the next two years Triad Hunter / Stone Energy JV Acreage Triad Hunter 50%…
  30. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 30
    Economic Sensitivity of Marcellus Economic Sensitivity of Marcellus Completed Well Cost - 6.5 MM High Case - Type Curve Middle Case -Type Curve Low Case - Type Curve IP: 7 Mmcf/D IP: 5 MMcf/D IP: 4 MMcf/D High Case Initial Decline:…
  31. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 31
    Utica Shale Overview On February 17, 2012, MHR closed on the acquisition of 12,186 net Utica Shale acres for approximately 25 million (2,037/acre) The acreage is predominantly located in Noble County, OH Wet The majority of the…
  32. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 32
    Southern Appalachia Overview Operations: Current Drilling/Completing Operations: Drilling one well in Harlan County, Arch Field, Kentucky targeting the Weir Sand Since Completion of the NGAS Acquisition MHR has: Restructured…
  33. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 33
    Weir Sand Kentucky Liquids Play 38,000 PROSPECTIVE ACRES HORIZONTAL WELLS TO DATE Well 1: 5645 of Production Casing Ran 10 Stage Slick Water Frac Well 2: 6193 of Production Casing Ran 12 Stage 65 Quality Foam Frac Well 3: 6035…
  34. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 34
    Appalachia Shale Has Best Gas Economics Estimated Gas Price Required for 10% IRR 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 Source: Morgan Stanley Research Report (January 2011) 35
  35. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 35
    Eureka Hunter 36
  36. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 36
    Eureka Hunter Pipeline Background Acquired by Magnum Hunter from Triad Energy in February 2010 First Priority: Be there and ready for Triad Hunter equity gas Upsized pipe to 20 inches to capture 3rd party producers Local producers…
  37. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 37
    Eureka Hunter Pipeline - Overview Eureka Hunter Eureka Hunter 20 Pipeline(s) and Right of Ways and Connecting Gathering Systems MarkWest Ohio and West Virginia Mobley Plant Eureka Carbide Mobley to Site - Equitrans - TCO…
  38. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 38
    Eureka Filling Void in Northern WV MHR Acreage WI 100% or HBP MHR Acreage…
  39. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 39
    Eureka Hunter Pipeline Key Points 20 - 900 psi gathering system. Maximum allowable operating pressure 1,000 psi 200 300 Mmcf per day design capacity could be increased Strategically located in heart of Marcellus wet gas corridor of…
  40. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 40
    3/7/2012 Utica Shale Overview The Utica Shale: The Utica extent extends for 170,000 sq miles (Nearly twice the size of the Marcellus Shale extent) Big players are attracted to Utica including CHK, Range, Consol, Devon, Anadarko,…
  41. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 41
    Construction Photos 42
  42. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 42
    Financial Overview 43
  43. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 43
    Financing Highlights Senior Credit Facilities of 350 million provided by Amegy Bank, BMO, Capital One, Citibank, Credit Suisse, Deutsche Bank, Goldman Sachs, KeyBanc, SunTrust Bank, UBS and Union Bank Revolving Credit Facility of up to…
  44. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 44
    Additional Equity Issued NuLoch Acquisition (VWAP of 7.40/share) 314 Million NGAS Acquisition (VWAP of 7.99/share) 56 Million PostRock Acquisition (VWAP of 7.92/share) 8 Million Total Equity Capital Issued in Acquisitions of 378…
  45. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 45
    Capitalization December 31, December 31, March 31, June 30, September 30, December 31, 2009 2010 2011 2011 2011 2011 Cash and Cash Equivalents 2,281 554 3,836 4,750 10,687 14,851 (1) Notes Payable, Less Current Portion 13,000…
  46. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 46
    Summary of Commodity Hedges in Place As of 2/17/2012 2012 2013 NATURAL GAS HEDGES: Swaps Volume (mmbtu/d) 14,459 15,500 Price - /mmbtu 3.57 3.52 Collars Volume (mmbtu/d) 11,879 12,500 Floor Price - /mmbtu 4.58 4.50 High Price -…
  47. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 47
    Historical Lifting Costs 40.00 35.00 30.00 26.48 25.00 21.90 /Boe 20.00 15.00 13.46 10.00 5.00 - 2009 2010 2011 48
  48. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 48
    Financial Goals Continue to increase Senior Credit Facility borrowing base through reserve additions from organic growth through the drill bit Move allocated capital to higher IRR liquids projects within the portfolio Continue to…
  49. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 49
    Summary Experienced and Seasoned Management Team and Board Significant Insider Ownership 15% Well Positioned in the Three Top Resources Plays in the US Ability to Shift Capital Away from Gas to Oil/Liquids Projects Demonstrating…
  50. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 50
    Contact Information Magnum Hunter Resources (NYSE: MHR) Equity Research Analyst Coverage: BMO Capital Markets Pritchard Capital Canaccord Genuity Robert W. Baird & Co. Capital One Southcoast, Inc. Rodman & Renshaw. Caris & Company…
  51. MARCH 2012 INVESTOR PRESENTATION – Magnum Hunter Resources Corp. – slide 51
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