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SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Aug 1, 2012 · 41 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. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 1
    Second Quarter 2012 Earnings August 1, 2012
  2. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 2
    Highlights Q2 2012 adjusted income1 of 98 MM, or 0.78 per adjusted share1 Q2 2012 production: 150,506 BOEPD2 Spraberry production negatively impacted by 4,800 BOEPD due to unplanned third-party NGL fractionation capacity shortfalls at…
  3. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 3
    Highlights Contd Deeper vertical well drilling to the Strawn, Atoka and Mississippian intervals in the Spraberry field driving production outperformance Maintaining 2012 drilling capital at 2.4 B by reducing second half activity in…
  4. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 4
    Wolfcamp Shale JV Opportunity Offering 33% to 50% of Pioneers working interest in 200,000 acres in southern portion of Midland Basin (8% to 12% of total acreage position) Large, contiguous acreage position located in Upton, Reagan,…
  5. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 5
    Increasing 2012 Production Growth Target1 MBOEPD 150 - 155 Increasing 2012 production growth 148 153 target from 23% - 27% to 25% - 29% FY Guidance Strong drilling and well 147 151 performance outweighs continuing third-party NGL…
  6. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 6
    2012E Capital Spending and Cash Flow1 B Capital program includes: Drilling capital 2.4 Vertical integration 0.5 Sensitivity to Commodity Prices ( MM) Includes 100 MM for field facilities 6.00 accelerated into 2012 5.00 2.9…
  7. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 7
    2012 Drilling Capital1 Millions 2H Drilling Program 27 30 Spraberry vertical rigs 4 horizontal Wolfcamp Shale rigs drilling development wells (7 rigs late in Q4) 12 Eagle Ford Shale rigs 1 Barnett Shale Combo rig 1 Alaska rig…
  8. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 8
    Investment Highlights U.S. asset base Oil exposure from proved reserves + estimated net resource potential of 7 BBOE 2012 drilling program focused in four liquids and resource rich plays in Texas Spraberry Vertical Horizontal…
  9. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 9
    Horizontal Wolfcamp Shale Results Exceeding Expectations Gross cumulative production of 2 Giddings wells First two wells in XBC Giddings Estate in northern Upton county from B interval: Stimulated lateral lengths: 5,300 107 MBOE in…
  10. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 10
    Horizontal Wolfcamp Shale Drilling Activity Currently focused on holding 50,000 acres in southern part of play during 2012 and 2013 Expect to drill 90 wells by YE 2013 to hold acreage 4 rigs running; increasing to 7 rigs late Q4 9…
  11. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 11
    Spraberry Vertical Deeper Drilling Driving Production Outperformance 6,000 ft Upper Clear- Spraberry fork Deeper drilling increased from 50% to 65% of 2012 vertical drilling program Commingled Potential Spraberry…
  12. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 12
    Continuing to Successfully Grow Spraberry Production Spraberry Net Production1 (MBOEPD) 63 - 67 Q2 production negatively impacted by 61 65 MBOEPD 4,800 BOEPD due to unplanned third- FY Guidance party fractionation capacity…
  13. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 13
    Eagle Ford Shale Operational Update Drilled 34 wells in Q2 2012; 37 wells placed on production Running 12 rigs Current gross well cost: 7 MM - 8 MM 2012 drilling program: 125 wells Continues to focus on liquids-rich drilling with…
  14. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 14
    Successfully Growing Eagle Ford Shale Production Eagle Ford Shale Net Production1 (MBOEPD) 25 29 MBOEPD FY Guidance 24 23 12 2011 Q1 Q2 2H E 2012 1) Reflects Pioneers 35% share of total gross production 15
  15. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 15
    Barnett Shale Combo Operational Update Drilled 12 wells in Q2; 10 wells placed on production Reducing rig count from 2 rigs to 1 rig in August in response to low gas and NGL prices Target gross well cost for 5,000 lateral: 3.3 MM…
  16. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 16
    Successfully Growing Barnett Shale Combo Production Barnett Shale Net Production (MBOEPD) 7 9 MBOEPD FY Guidance 7 6 4 2011 Q1 Q2 2H E 2012 17
  17. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 17
    Alaska - Oooguruk Q2 production of 5 MBOPD Up 1 MBOPD vs. Q1; primarily related to PXD Acreage Initial Development first successful mechanically diverted Area frac on Nuiqsut well 1-rig development program continues Island Drill…
  18. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 18
    Q2 2012 Earnings Summary Millions (After Tax) Per Share Net loss attributable to common stockholders (70) (0.57) Unrealized mark-to-market (MTM) derivative gain (96 MM before tax) (61) (0.49) Adjusted loss excluding unrealized MTM…
  19. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 19
    Price Realizations1 Realized Prices (excludes VPPs and derivatives) 98.39 99.15 91.51 86.96 86.87 48.16 48.36 45.70 41.81 32.62 4.11 4.04 3.37 2.51 2.00 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q2…
  20. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 20
    Production Costs (per BOE)1 14.70 13.81 13.79 13.79 Workovers 13.27 0.96 7% increase in Q2 compared to Q1 1.03 0.77 0.68 0.69 primarily attributable to: Production & 3.25 Ad Valorem Taxes 3.38 3.18 3.43 Increased workover…
  21. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 21
    Q3 2012 Guidance1 Guidance Daily Production (MBOEPD) 155 159 Production Costs (/BOE) 13.50 15.50 Exploration & Abandonment ( MM) 25 40 Drilling and Acreage 20 Personnel and Seismic 20 DD&A (/BOE) 13.00 15.00 G&A ( MM) 55 60…
  22. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 22
    Liquidity Position (6/30/12)1 Net debt (net of cash balance of 318 MM): 3.0 B Unsecured Credit Facility availability: 1.1 B Net Debt-to-Book Capitalization: 34% Maturities and Balances2 2011 2012 2013 2016 2017 2018 2020 2022…
  23. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 23
    Production (MBOEPD)1 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 3 Spraberry 41 47 53 62 64 Raton 27 27 26 26 25 Eagle Ford Shale 8 14 20 23 24 South Texas 8 8 7 7 6 2 Mid-Continent 21 19 19 18 18 Barnett 3 4 6 6 7 Alaska 5 4 4 4 5…
  24. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 24
    Oil and Gas Revenue1 Millions 719 665 9 642 11 VPP Deferred 591 10 Revenue 562 10 10 710 654 632 552 581 Q2 '11 Q3 '11 Q4 '11 Q1 '12 Q2 '12 1) All periods presented have been restated to exclude discontinued operations…
  25. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 25
    PXD Open Commodity Derivative Positions as of 7/30/2012 (includes PSE) Oil Q3 2012 Q4 2012 2013 2014 2015 Swaps WTI (BPD) 8,304 11,000 3,000 - - NYMEX WTI Price (/BBL) 88.12 89.34 81.02 - - Collars - (BPD) 2,000 2,000 - - - NYMEX…
  26. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 26
    PXD Open Commodity Derivative Positions as of 7/30/2012 (includes PSE) Gas Q3 2012 Q4 2012 2013 2014 2015 Swaps - (MMBTUPD) 275,000 275,000 112,500 - - NYMEX Price (/MMBTU)1 4.97 4.97 5.62 - - Collars - (MMBTUPD) 65,000 65,000…
  27. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 27
    PSE Derivative Position as of 7/30/2012 Oil Q3 2012 Q4 2012 2013 2014 2015 Swaps (BPD) 3,000 3,000 3,000 - - NYMEX Price (/BBL) 79.32 79.32 81.02 - - Three-Way Collars (BPD)1 1,500 1,500 1,750 5,000 - NYMEX Call Price (/BBL) 109.00…
  28. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 28
    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 0.3…
  29. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 29
    Impact of Volumetric Production Payments (VPP) Amortization of VPP Deferred Revenue & Other Comprehensive Income1 ( Million) Q1 Q2 Q3 Q4 Total Gas / Oil Gas / Oil Gas / Oil Gas / Oil Gas / Oil 2005 11 / - 19 / - 21 / - 20 / - 71 /…
  30. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 30
    Oil Differentials (per BBL)1 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 NYMEX calendar month average 102.56 89.76 94.06 102.93 93.49 NYMEX differential (4.17) (2.80) (2.55) (3.78) (6.62) Realized prices excluding VPPs and derivatives 98.39…
  31. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 31
    NGL Differentials (per BBL)1 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 NYMEX oil calendar month average 102.56 89.76 94.06 102.93 93.49 NYMEX differential (54.40) (41.40) (48.36) (61.12) (60.87) Realized prices excluding derivatives 48.16 48.36…
  32. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 32
    Gas Differentials (per MCF)1 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 NYMEX bid week average 4.32 4.20 3.55 2.72 2.21 NYMEX differential (0.21) (0.16) (0.18) (0.21) (0.21) Realized prices excluding derivatives 4.11 4.04 3.37 2.51 2.00…
  33. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 33
    General & Administrative Costs1 Millions 63 55 12 55 50 10 13 Noncash 44 9 10 Q2 Q3 Q4 Q1 Q2 2011 2011 2011 2012 2012 1) All periods presented have been restated to exclude discontinued operations 35
  34. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 34
    Interest Costs1 Millions 49 45 46 46 47 Q2 Q3 Q4 Q1 Q2 2011 2011 2011 2012 2012 1) All periods presented have been restated to exclude discontinued operations 36
  35. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 35
    Exploration & Abandonments Millions Drilling & Acreage Alaska 1 Acreage & Other 12 13 Geological & Geophysical Seismic 11 Personnel & Other 13 24 2nd Quarter 2012 Total 37 37
  36. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 36
    Income Taxes Attributable to Continuing Operations Quarter Ended June 30, 2012 ( Millions) Current tax provision (3) Deferred tax benefit 48 45 38
  37. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 37
    Supplemental Non-GAAP Financial Measures EBITDAX and discretionary cash flow (DCF) are disclosed by Pioneer, and reconciled to the generally accepted accounting principle (GAAP) measures of net loss and net cash provided by operating…
  38. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 38
    Supplemental Earnings Per Share Information The Company uses the two-class method of calculating basic and diluted earnings per share. Under the two-class method of calculating earnings per share, GAAP provides that share- and unit-based…
  39. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 39
    Supplemental Non-GAAP Financial Measures Adjusted income excluding unrealized MTM derivative gains and adjusted income excluding unrealized MTM derivative gains, unusual items and the incremental share dilution attributable to convertible…
  40. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 40
    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…
  41. SECOND QUARTER 2012 EARNINGS – Pioneer Natural Resources Co. – slide 41
    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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