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CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Feb 8, 2012 · 43 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. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 1
    Credit Suisse 2012 Energy Summit February 8, 2012
  2. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 2
    Highlights Q4 2011 adjusted income1 of 147 MM, or 1.19 per diluted share Excludes unrealized mark-to-market derivative losses of 22 MM after tax, or 0.18 per diluted share Excludes net loss from unusual items of 236 MM after tax, or…
  3. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 3
    Highlights (cont.) Forecasting annual production growth of 23% to 27% from 2011 to 2012 (excluding discontinued operations) Compares to previous forecast of 22+% High-grading liquids-rich drilling to optimize returns in response to…
  4. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 4
    Increasing 2012 Production Growth Target and Announcing 2012 2014 CAGR MBOEPD 140 MBOEPD including South Africa 148 - 153 137 124 114 107 49% 56% 65% Liquids Liquids Liquids Q1 Q2 Q3 Q4 2012E 2013E 2014E 2011 120…
  5. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 5
    2012E Capital Spending and Cash Flow1 Capital program of 2.5 B includes: 1,525 MM Spraberry Vertical Includes 100 MM for infrastructure Sensitivity to Commodity Prices ( MM) 6.00 275 MM Horizontal Wolfcamp Shale Includes 25 MM for…
  6. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 6
    Substantial Operating Cash Flow Growth1 Billions 3.3 2.8 2.2 1.5 80% Revenue 90% Revenue From Liquids From Liquids 2011 2012E 2013E 2014E 1) Based on commodity prices of 100/bbl oil and 3/mcf gas for 2012 and 100/bbl…
  7. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 7
    Strong 2011 Reserve Additions1 Added 148 MMBOE from the drillbit, or 313% of full- year production, at F&D cost of 13.83 per BOE Reflects significant drilling campaigns in Spraberry, Eagle Ford Shale and Barnett Shale Combo plays…
  8. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 8
    Industry Increasing Horizontal Wolfcamp Shale Activity Average Drilling Rigs 21 rigs currently Average Lateral Length (Feet) (All Companies) (EOG, Approach, El Paso, Pioneer) 7,400 13 6,500 11 5,900 10 4,700 3,600 5 1 Q3…
  9. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 9
    PXDs Second Successful Horizontal Wolfcamp Shale Well XBC Giddings Estate 2073H Jo Mill Second successful horizontal Wolfcamp Shale well in Lower Spraberry Upton County (similar design and completion to first well) Shale Dean…
  10. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 10
    First Two Successful Horizontal Wolfcamp Shale Wells Performing Above Expectations Peak 30-day average natural flow rates similar for first two Upton County wells 90-day cumulative production totaling 45 MBOE for first Upton County…
  11. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 11
    PXDs Acreage Has Significant Horizontal Wolfcamp Shale Potential 400,000 acres potentially prospective for horizontal Wolfcamp PXD Giddings Estate 2041H & 2073H Industry 700+ BOEPD IPs 800+ BOEPD IPs Shale (Upper/Middle Wolfcamp…
  12. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 12
    PXDs Horizontal Wolfcamp Shale Drilling Plan 2012 2013 Drilling Plan PXD currently focused on 200,000 acres in XBC Giddings Estate the southern part of the field (Upper/Middle First Two Wells Wolfcamp interval) Additional 200,000…
  13. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 13
    Spraberry Vertical Deeper Drilling Results 6,000 ft Upper Clear- Spraberry fork 2011 Strawn Results 246 vertical wells completed in the Strawn interval during 2011 25+% increase in cumulative production during first 12 months…
  14. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 14
    Spraberry Vertical Drilling Program 6,000 ft Upper Clear- Spraberry fork 2012 Vertical Drilling Program (750 Wells) Deepest Interval Current Blended Before Tax % of Program Completed Well Cost (MM) IRR1 Spraberry…
  15. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 15
    Continuing to Successfully Grow Spraberry Production Spraberry Net Production1 (MBOEPD) Assumes 41 vertical rigs in Q1 declining to 30 rigs by YE 96 103 and 3 horizontal rigs in Q1 increasing to 7 rigs by YE3 81 87 (750 vertical…
  16. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 16
    Eagle Ford Shale Operational Update Drilled 111 wells in 2011; 92 wells put on production Running 12 rigs Current gross well cost: 7 MM - 8 MM 2012 drilling program before-tax IRR1 70%; impacted by low gas prices 2012 drilling…
  17. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 17
    Successfully Growing Eagle Ford Shale Production Eagle Ford Net Production1 (MBOEPD) 47 53 37 41 25 29 20 14 8 5 2 2010 Q1 Q2 Q3 Q4 2012E 2013E 2014E 2011 12 MBOEPD (drilled 111 wells) Rigs 7 YE 12 Mid-Year 12 14…
  18. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 18
    Barnett Shale Combo Operational Update Drilled 43 wells in 2011; 42 wells put on production Running 2 rigs Target gross well cost for 5,000 lateral: 3.5 MM (increase from 2011 reflecting longer lateral length) Gross EUR: 460 MBOE…
  19. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 19
    Successfully Growing Barnett Shale Combo Production Barnett Shale Net Production1 (MBOEPD) 18 23 12 16 79 6 4 3 2 3 2010 Q1 Q2 Q3 Q4 2012E 2013E 2014E 2011 4 MBOEPD (drilled 43 wells) Rigs 1 YE 2 2 4 4 1) 2010…
  20. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 20
    Investment Highlights U.S. asset base 2012 drilling program focused in four liquids-rich plays with substantial resource potential Spraberry Vertical Wolfcamp Shale Horizontal Eagle Ford Shale Barnett Shale Combo Forecasting 20+%…
  21. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 21
    Appendix 22
  22. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 22
    Pioneer Operations North Slope Raton Hugoton Barnett Shale Combo West Panhandle Spraberry Vertical Horizontal Wolfcamp Shale Eagle Ford Shale Operating Areas 23
  23. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 23
    Early Results of Spraberry Waterflood Encouraging 600 Water injection 7,000-acre project in Spraberry begins 12 injectors and 110 producers Injecting 4,100 BWPD 6 - 7 MM capital cost 500 LOE savings from water handling 400…
  24. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 24
    Spraberry 20-Acre Vertical Well Update 20-Acre Drilling (13,000 locations) Drilled 18 wells in 2010 and 16 wells in 2011 Most wells drilled to the Lower Wolfcamp with a few drilled to the Strawn Results to date indicate…
  25. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 25
    140 MBOE Spraberry 40-Acre Vertical Well Type Curve 90 Deeper drilling in Spraberry increasing EURs 80 Gross Production Per Well (BOEPD) 70 60 50 140 MBOE Spraberry/Dean/Full Wolfcamp 40 (70% oil, 20% NGLs, 10% gas)…
  26. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 26
    Eagle Ford Shale: A Burgeoning Liquids-Rich Shale Play Gross resource potential of play: 25 BBOE (150 TCFE)1 Estimated Gross Production of 3.5 MMBOEPD by 20202 200 rigs currently running in the play Oil Window PXD Acreage…
  27. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 27
    Eagle Ford Shale Resource Breakdown Lean Condensate Rich Condensate Dry Gas 45% of Acreage 35% of Acreage 20% of Acreage (60 BBL/MMSCF) (200 BBL/MMSCF) 20% 20% 30% Condensate NGL* NGL* 50% 100% Condensate Gas 50% 30% Gas…
  28. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 28
    Alaska - Oooguruk PXD Acreage Initial 1-rig drilling program continues Development Area targeting Kuparuk and Nuiqsut Island Drill Site intervals Ivishak Area Second rig to test Torok zone and a Ivishak Drill Site deeper…
  29. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 29
    Pioneers Vertical Integration Improves Returns and Enhances Execution Spraberry Eagle Ford Shale Barnett Shale Combo 5 frac fleets (20,000 HP each) 2 frac fleets 1 frac fleet (adding 70,000 HP by mid-2012) 1 coiled tubing units 1…
  30. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 30
    Vertical Integration Significantly Reduces Well Costs Spraberry Eagle Ford Shale Barnett Shale Combo Frac Fleets Current (225,000 HP) 5 2 1 % of Total Wells Fraced 70% 65% 100% Fracs/Fleet/Year 115 55 60 Savings Per Frac1 0.35…
  31. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 31
    Production (MBOEPD)1 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Spraberry 38 40 41 47 53 Raton 28 27 27 27 26 Eagle Ford Shale 2 5 8 14 20 South Texas 9 8 8 8 7 2 2 Mid-Continent 20 18 21 19 19 Barnett 2 2 3 4 6 Alaska 6 5 5 4 4…
  32. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 32
    PXD Production By Commodity By Area1 1) All periods presented have been restated to exclude discontinued operations 33
  33. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 33
    Liquidity Position (12/31/11)1 Net debt (net of cash balance of 537 MM): 2.0 B Unsecured Senior Credit Facility availability: 1.2 B Net Debt-to-Book Capitalization: 26% Maturities and Balances2 2011 2012 2013 2016 2017 2018 2020…
  34. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 34
    Production Costs (per BOE)1 13.75 13.27 13.81 13.79 0.81 1.03 0.77 0.68 Q4 11 vs. Q3 11 essentially flat 11.60 Workovers 3.18 Third party transportation increased 0.77 3.46 3.38 3.46 0.46 primarily due to higher Eagle Ford…
  35. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 35
    VPP Adjusted Production Costs1 Pioneer presents VPP-Adjusted Production Costs (per BOE) to assist investors in considering the Companys costs in relation to the total BOEs (reported sales volumes plus VPP delivered volumes) in…
  36. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 36
    PXD Cash Costs vs. Peers For First 9 Months of 2011 9 Months 2011 Cash Costs ( / BOE)1 23.51 20.95 3.42 Interest 4.06 16.51 4.39 G&A 4.12 3.11 4.06 15.70 Prod Costs 12.77 9.34 2 3 PXD VPP-Adjusted ISI Gas-Focused ISI…
  37. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 37
    PXD Open Commodity Derivative Positions as of 2/3/2012 (includes PSE) Oil 2012 2013 2014 2015 Swaps WTI (BPD) 3,000 3,000 - - NYMEX WTI Price (/BBL) 79.32 81.02 - - Collars - (BPD) 2,000 - - - NYMEX Call Price (/BBL) 127.00 - - -…
  38. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 38
    PXD Open Commodity Derivative Positions as of 2/3/2012 (includes PSE) Gas 2012 2013 2014 2015 Swaps - (MMBTUPD) 200,000 112,500 50,000 - NYMEX Price (/MMBTU)1 5.17 5.62 6.05 - Collars - (MMBTUPD) 65,000 150,000 140,000 50,000 NYMEX…
  39. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 39
    PSE Derivative Position as of 2/3/2012 Oil 2012 2013 2014 Swaps (BPD) 3,000 3,000 - NYMEX Price (/BBL) 79.32 81.02 - Three-Way Collars (BPD)1 1,000 1,000 4,000 NYMEX Call Price (/BBL) 103.50 111.50 124.75 NYMEX Put Price (/BBL)…
  40. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 40
    Three-Way Collars (75 by 90 by 135 example) Unhedged realization Hedged realization 160.00 NYMEX Price 150.00 Potential 140.00 Opportunity Loss Realized Price 130.00 Realized Price (/BBL) Short put at 75/BBL Long put at…
  41. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 41
    VPP Expirations At the end of 2012, the VPP commitment will expire and provide 3.5 MBOPD increase in production MBOPD 3.5 VPP Oil Obligation 2012 2013 Schedule of Oil VPP Volumes (MMBBLS) Q1 Q2 Q3 Q4 Total 2012 0.3 0.3…
  42. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 42
    Oil/Gas Ratio Trending Up Since 2006 Oil/Gas ratio has increased from 5:1 in 2006 to 25:1 recently Oil Price Oil/Gas Ratio Gas Price 43
  43. CREDIT SUISSE 2012 ENERGY SUMMIT – Pioneer Natural Resources Co. – slide 43
    Certain Reserve Information Cautionary Note to U.S. Investors --The U.S. Securities and Exchange Commission (the SEC) prohibits oil and gas companies, in their filings with the SEC, from disclosing estimates of oil or gas resources other…

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