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Q4 2011 Earnings Call – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Feb 7, 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. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 1
    Fourth Quarter 2011 Earnings February 7, 2012
  2. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 4
    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…
  5. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 5
    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…
  6. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 7
    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…
  8. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 8
    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+%…
  9. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – 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. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 20
    Q4 2011 Earnings Summary Millions Per Diluted (After Tax) Share Net loss attributable to common stockholders (111) (0.93) Unrealized mark-to-market (MTM) derivative losses (34 MM before tax) 22 0.18 Adjusted loss excluding…
  21. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 21
    Price Realizations1 Realized Prices (excludes VPPs and derivatives) 98.39 91.51 89.17 86.96 79.90 48.16 48.36 45.70 41.03 42.17 3.88 4.11 4.04 3.57 3.37 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q4 10…
  22. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 22
    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…
  23. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 23
    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…
  24. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 24
    Q1 2012 Guidance1 Guidance Daily Production (MBOEPD) 141 - 146 Production Costs (/BOE) 13.00 15.00 Exploration & Abandonment ( MM) 35 - 60 Drilling and Acreage 35 Personnel and Seismic 25 DD&A (/BOE) 13.00 15.00 G&A ( MM) 49…
  25. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 25
    2011 Drilling Capital1 Millions 613 551 459 328 Q1 2011 Q2 2011 Q3 2011 Q4 2011 1) Excludes acquisitions (132 MM), asset retirement obligations (19 MM), capitalized interest (13 MM), G&G G&A (47 MM) and discontinued…
  26. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 26
    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…
  27. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 27
    Oil and Gas Revenue1 Millions 665 11 VPP Deferred 591 Revenue 562 10 10 476 454 10 22 654 552 581 432 466 Q4 '10 Q1 '11 Q2 '11 Q3 '11 Q4 '11 1) All periods presented have been restated to exclude discontinued…
  28. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 28
    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 - - -…
  29. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 29
    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…
  30. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 30
    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)…
  31. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 31
    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…
  32. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 32
    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 /…
  33. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 33
    Oil Differentials (per BBL)1 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 NYMEX calendar month average 85.18 94.10 102.56 89.76 94.06 NYMEX differential excluding VPPs and derivatives (5.28) (4.93) (4.17) (2.80) (2.55) Realized prices excluding…
  34. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 34
    NGL Differentials (per BBL)1 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 NYMEX oil calendar month average 85.18 94.10 102.56 89.76 94.06 NYMEX differential excluding derivatives (44.15) (51.93) (54.40) (41.40) (48.36) Realized prices excluding…
  35. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 35
    Gas Differentials (per MCF)1 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 NYMEX bid week average 3.80 4.11 4.32 4.20 3.55 NYMEX differential excluding derivatives (0.23) (0.23) (0.21) (0.16) (0.18) Realized prices excluding derivatives 3.57…
  36. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 36
    Other Costs1 General & Administrative Costs Interest Costs Millions Millions 55 50 45 45 45 46 46 Noncash 10 43 44 44 9 8 8 10 Q4 Q1 Q2 Q3 Q4 Q4 Q1 Q2 Q3 Q4 2010 2011 2011 2011 2011 2010 2011 2011 2011 2011 1) All periods…
  37. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 37
    Exploration & Abandonments Millions Drilling & Acreage Dry Gas Acreage 31 Other Acreage 8 Drilling 2 41 Geological & Geophysical Seismic 12 Personnel & Other 11 23 4th Quarter 2011 Total 64 39
  38. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 38
    Income Taxes Attributable to Continuing Operations Quarter Ended December 31, 2011 ( Millions) U. S. Current tax provision (1) Deferred tax benefit 76 Tax benefit 75 40
  39. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 39
    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…
  40. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 40
    Supplemental Non-GAAP Financial Measures Adjusted loss excluding unrealized MTM derivative losses and adjusted income excluding MTM derivative losses and unusual items, as presented in the Q4 2011 Earnings Summary slide, is presented…
  41. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 41
    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…
  42. Q4 2011 Earnings Call – Pioneer Natural Resources Co. – slide 42
    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…
  43. Q4 2011 Earnings Call – 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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