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ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc.

PDC Energy, Inc. · Apr 9, 2013 · 101 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. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 1
    ANALYST DAY: NEW YORK APRIL 4, 2013 April 9, 2013 Correction to Slide 22 NASDAQ:PDCE
  2. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 2
    James Trimble Chief Executive Officer and President 4/4/2013 3
  3. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 3
    Company Overview NASDAQ: PDCE Market cap 1.5 Billion(1) Strategic Core Areas Enterprise value 2.2 Billion(1) Colorado and Appalachian Basin Proved reserves 193 MMBoe (1.2 Tcfe)(2) WATTENBERG Liquid- UTICA 48% liquids, 42% proved…
  4. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 4
    Barton Brookman Senior Vice President Exploration and Production 4/4/2013 6
  5. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 5
    Operational Overview Wattenberg UTICA - APPALACHIAN BASIN Liquid-Rich 2013E Production: 5,489 MBoe 2013E Production: 392 MBoe Basins 70-80% Liquids 50-80% Liquids 99,000 Net Acres(1) 95% HBP 45,700 Net Acres 57% HBP PDC…
  6. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 6
    2012 Operational Accomplishments Company transition to 50% liquids commodity mix Current inventory of 4,700 highly economic projects Full delineation on PDCs horizontal Niobrara Wattenberg position Niobrara A,B,C benches…
  7. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 7
    Reallocated Capital to Liquid-Rich Projects Average Daily Net Oil & NGLs Average Daily Net Gas 12,000 100,000 90,000 10,000 80,000 70,000 8,000 Assumes 60,000 non-core Colorado Bopd Mcfd 6,000 50,000 asset…
  8. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 8
    Gross Margin Growth Gross Margin (/Boe) 40 35 30 25 /Boe 20 15 10 5 0 2009 2010 2011 2012 2013E * Gross Margin = Sales less Production Costs excluding gain/loss on derivatives * 2013E assumes closing…
  9. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 9
    Organic Investment Opportunities WATTENBERG UTICA - APPALACHIAN BASIN 2,000 HZ Projects 200 HZ Projects (1,000 spacing) 6.3 Billion Estimated Capital (Net) 1.6 Billion Estimated Capital (Net) 387 Proved HZ locations 30% - 80% IRR(1)…
  10. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 10
    Focused on HZ Drilling Gross Horizontal Wells Gross Vertical Wells Frac Stages 100 95 250 1400 1236 90 206 1200 80 200 1031 171 963 70 1000 60 54 150 800 50 40 100 600 400 30 24 400 20 50 7 200 10 9 0 0 0 0 2010 2011 2012…
  11. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 11
    Production Highlights Net Production (MBoe) 2,500 LaSalle gas plant in Wattenberg startup fall of 2013 Oil / Liquids Gas Substantial contribution from horizontal Codell 2,000 Production contribution from Wattenberg 3rd rig in…
  12. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 12
    Production by Area MBoe 2012 Commodity Mix 2011 2012 2013E Wattenberg 3,880 4,458 5,489 Oil 25% Utica - - 392 Appalachia 737 1,032 1,381 Gas 65% NGLs Piceance 2,258 2,242 - 10% NECO/ Other 626 537 - Total 7,501 8,269…
  13. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 13
    Capex Update MM PDC Energy 2012 2013E D&C Capital 184 349 Wattenberg 180 272 Utica - 77 Other 4 - Leasehold, Exploration 113 37 & Miscellaneous Wattenberg Acquisition 304 - Total PDC Energy Capex 602 386 PDCM (PDCE…
  14. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 14
    Lease Operating Expenses /Boe 2012 2013E Wattenberg 4.49 4.40 Utica - 5.36 PDCM (PDCE Share) 7.38 6.60 Piceance/ NECO 5.33 - Lifting Cost 5.11 4.88 Lease Operating Expense (MM) 42.2 35.4 Horizontal vs. Vertical LOE…
  15. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 15
    Scott Reasoner Vice President Western Operations 4/4/2013 17
  16. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 16
    Core Horizontal Wattenberg Third largest leaseholder and producer in the Wattenberg Field 99,000 net acres(1) 70% - 80% liquids Typical EURs from 300 to 500 MBoe Excellent returns IRR of 40% - 140%(2) 2,000 gross horizontal…
  17. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 17
    3rd Party Midstream Expansion - Wattenberg PDC Acreage Plants and compression strategically placed 2013 Compressor Site Sullivan CS around PDC acreage 2014 Compressor Site Lucerne 2 Plant LaSalle plant start-up late Q313 Processing…
  18. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 18
    Wattenberg 2013E Production Net Net Production Production (MBoe) 1,800 Oil / Liquids Gas 1,600 1,400 1,200 1,000 800 600 400 200 0 Q1'13 E Q2'13 E Q3'13 E Q4'13 E Total Wattenberg 2013E Production…
  19. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 19
    DJ Basin Stratigraphic Column Multiple Target Zones Current PDC Horizontal Program Data Drilling 3 to 5 well pads 4,000 average lateral length 16 frac stages per well Drill time of 12-15 days spud to spud Sliding sleeves, swell /…
  20. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 20
    Horizontal Production: Niobrara and Codell (2) EUR: 500 MBoe Capex: 4.2MM IRR(1): 140+% PV10: 7.5 MM EUR: 300 MBoe (2) Capex: 4.2MM IRR(1): 57% PV10: 3.2 MM (1) Flat Pricing: 90 NYMEX Oil, 3.50 NYMEX Gas. Excludes lease…
  21. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 21
    Horizontal Production: Codell Total Horizontal Codell Production 1,000 Boepd 100 8 Codell Wells 4 Codell Wells 1 Codell Well 10 0 30 60 90 120 150 180 210 240 270 300 330 Days 500 MBOE 300 MBOE Single Well Codell…
  22. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 22
    Horizontal Codell Development Strong Well Performance Shows Potential for Development Across Wattenberg 4/4/2013 24
  23. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 23
    Wattenberg Project Inventory Proved HZ Inventory 2P HZ Inventory* 3P HZ Inventory* 4 Gross wells per 640 Ac. 10 Gross wells per 640 Ac. 16 Gross wells per 640 Ac. Gross HZ Inventory: 384 (8 Niobrara, 2 Codell) (12 Niobrara, 4…
  24. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 24
    PDC Wattenberg Horizontal Program Schaefer SchaeferPad Pad 6N-63W-10 6N-63W-10 4-well 4-wellpad pad Riteaway Pad 5N-67-32 Wells Ranch Pad 4-well pad 6N-63W-34 4-well pad Waste Management Pad 2N-64W-2 16-wells…
  25. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 25
    Riteaway Pad 5N-67W-32 Map View Production (Boepd) 10,000 32 1,000 Vertical Well HZ Niobrara Stacked HZ Niobrara/ Codell 100 Side View Riteaway Pad Codell Riteaway Pad Niobrara Avg. 500 MBOE 300 MBOE 10 0 30 60…
  26. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 26
    Riteaway Pad: Niobrara A & C Bench 5N-67W-32 5N-67W-32 Map View Production (Boepd) 10,000 32 1,000 Vertical Well HZ Niobrara Stacked HZ Niobrara/ Codell 100 Side View HZ Niobrara - C Bench HZ Niobrara - A Bench 500…
  27. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 27
    PDC Wattenberg Horizontal Program Schaefer SchaeferPad Pad 6N-63W-10 6N-63W-10 4-well 4-wellpad pad Riteaway Pad 5N-67-32 Wells Ranch Pad 4-well pad 6N-63W-34 4-well pad Waste Management Pad 2N-64W-2 16-wells…
  28. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 28
    Wells Ranch Pad vs. Horizontal Well 6N-63W-34 Map View Production (Boepd) Wells Ranch Pad 10,000 34 1,000 Wells Ranch 43-34H Vertical Well HZ Niobrara Stacked HZ Niobrara/ Codell 100 Side View Wells Ranch Pad Avg.…
  29. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 29
    PDC Wattenberg Horizontal Program Schaefer Pad 6N-63W-10 4-well pad Riteaway Pad 5N-67-32 Wells Ranch Pad 4-well pad 6N-63W-34 4-well pad Waste Management Pad 2N-64W-2 16-wells Fall 2013 4/4/2013 31
  30. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 30
    Schaefer Pad 6N-63W-10 Map View Production (Boepd) 10,000 10 1,000 Vertical Well HZ Niobrara Stacked HZ Niobrara/ Codell 100 Side View Schaefer Pad Avg. 500 MBOE 300 MBOE 10 0 20 40 60 80 100 120 140 160 180 200…
  31. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 31
    Schaefer Pad 90 Day Cleanup 6N-63W-10 Map View 2 Phase Production (not total liquids) 10,000 10 1,000 Vertical Well HZ Niobrara Stacked HZ Niobrara/ Codell 100 Side View Schaefer Pad Average Wet Gas (Mcfd) Schaefer…
  32. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 32
    PDC Wattenberg Horizontal Program Schaefer SchaeferPad Pad 6N-63W-10 6N-63W-10 4-well 4-wellpad pad Riteaway Pad 5N-67-32 Wells Ranch Pad 4-well pad 6N-63W-34 4-well pad Waste Management Pad 2N-64W-2 16-wells…
  33. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 33
    Analysis of Tighter Well Spacing Detailed Reservoir Engineering Points Towards 40-Acre Horizontal Well Density Engineering team using reservoir modeling to understand drainage areas Comparing model data to actual production and…
  34. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 34
    Waste Management Pad Fall 2013 2N-64W-2 Map View Side View 4/4/2013 36
  35. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 35
    Wattenberg Future Wattenberg Net Production Wattenberg Spuds 8,000 140 Oil NGLs Gas 120 6,000 100 MBoe 80 4,000 60 2,000 40 20 0 0 2011 2012 2013E 2014E 2011 2012 2013E 2014E Development CAPEX 2011 175 MM 2012…
  36. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 36
    Utica Leasehold and Asset Summary Southeast Ohio Leasehold and asset summary Oil Wet Gas Condensate Dry Gas 45,700 net acres Average 95% WI, 16% royalty, 57% HBP PDCE 200 gross horizontal drilling locations 7 Planned 2013 PDCE…
  37. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 37
    Utica Development Timeline IP Rate on Detweiler well Expected completions on Palmer 44-20 vertical well announced at 2,197 Garvin & Neill wells in drilled (provided core and south boepd Washington County acreage validity)…
  38. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 38
    Utica Acreage Characteristics Northern Washington County - Well Log Utica Range of Point Pleasant rock property values for all of PDCEs 45,700 acres Point Pleasant Attributes PDCE Acreage Depth (ft.) 6,200 9,500 Thickness…
  39. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 39
    Utica Cross Section A Hickenbottom Onega Commisioners Palmer A Belmont County Guernsey County Morgan County Oil Wet Gas Condensate Dry Gas A Resistivity 1,000 2,000+ 1,000 2,000+ 800 2,000 (Ohms) A Porosity 6 - 13%…
  40. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 40
    Utica Operator Data Oil Wet Gas Condensate Dry Gas Boy Scout 1-33H Onega-Commissioners IP: 3,456 boepd Wagner 1-28H IP: 4,650 boepd Detweiler 42-3H 14-25H Ryser 1-25H IP: 2,197 boepd IP: 1,796 boepd IP: 2,914 boepd BK Stephens…
  41. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 41
    Stiers 3-Well Pad PDCs first Utica multi-well pad 2D seismic lines through acreage Testing different reservoir entry points 5,000 ft. laterals 1,000 ft. spacing between wells Different completion designs Evaluating 18 24 frac…
  42. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 42
    Utica Target Economics: Liquid-Rich Window Cross Section Utica Type Curves 10,000 EUR: 750 MBoe Capex: 8.5MM IRR: 80% PV10: 9.3 MM 1,000 Boepd EUR: 500 Mboe 100 Capex: 8.5MM IRR: 30% PV10: 3.4 MM 10 0 30 60 90…
  43. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 43
    Utica Utica 2013 2013 Objectives Obtain production data to support continued drilling in 2nd half of 2013 Deliver midstream solution for Northern acreage Establish Utica production in Guernsey & Northern Washington Counties…
  44. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 44
    Utica Future Utica Net Production Utica Spuds 1,400 14 Oil NGLs Gas 1,200 12 1,000 10 MBoe 800 8 600 6 400 4 200 2 0 0 2011 2012 2013E 2014E 2011 2012 2013E 2014E Development CAPEX 2013E 77 MM 2014E 105MM…
  45. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 45
    Dewey Gerdom Chief Executive Officer PDC Mountaineer, LLC 4/4/2013 47
  46. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 46
    Appalachian Basin - Marcellus Marcellus Overview 3 O.E.S 3-well pad Gross Productive Wells 47 Horizontal 32 Vertical 15 Net Acreage (Full JV) 125,250 West Virginia 116,250 4 Armstrong/Reynolds Pennsylvania 9,000 4-well…
  47. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 47
    Marcellus Horizontal Marcellus Well Production Normalized to 5,000' Lateral 10,000 MCFD 1,000 CAPEX: 7 MM 3.50/MCF (Year 1) EUR: 9 BCF Type Curve F&D: 0.72/MCFE IRR: 32% EUR: 7 BCF Type Curve F&D: 0.93/MCFE IRR: 20% EUR:…
  48. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 48
    Marcellus Future Marcellus Net PDC Marcellus Spuds 2,500 18 Gas 16 2,000 14 12 MBoe 1,500 10 1,000 8 6 500 4 2 0 0 2011 2012 2013E 2014E 2011 2012 2013E 2014E PDCM Development CAPEX 2011 49 MM 2012 25 MM 2013E…
  49. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 49
    PDCM Cost Initiatives Standardize footprints for well location No more winter construction Construction, Wetland delineation first, instead of last Locations, Land part of process Move from 2 and 3 well pads to 5 and 6 well pad…
  50. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 50
    James Lillo Vice President Engineering and Technology 4/4/2013 52
  51. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 51
    YE2012 Reserves Summary Solid Growth Despite Price Declines and Divestitures 4/4/2013 53
  52. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 52
    YE2012 Reserves Walk-Through (MMBoe) Large Additions in Wattenberg Offset Write-Downs in Piceance Significant reserves additions in the horizontal Niobrara helped to minimize effects of PUD write-downs in Piceance and other…
  53. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 53
    10 Years of Consistent Proved Reserve Growth Completed Transition to Balanced Reserves Mix Long-term reserve growth driven by entry into resource plays with successful exploitation Recent reserves growth primarily driven by…
  54. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 54
    Horizontal Niobrara Performance Continued Delineation of Core Wattenberg Continued horizontal development of the Niobrara has delineated three core areas across the Wattenberg Field The core areas represent the different areas…
  55. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 55
    Horizontal Niobrara Delineation Significant Inventory of Wells Across All Areas Within Core Wattenberg Significant exposure to the middle core, which has the best economics in the play Development of core Wattenberg has…
  56. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 56
    Horizontal Niobrara Long-Term Profiles Long-Term Production Results from Industry Wells Show Consistent Liquids Mix Across the Field OUTER CORE Stable GOR: 3.6 Mcf/Bbl MIDDLE CORE Stable GOR: 9.0 Mcf/Bbl INNER CORE Stable…
  57. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 57
    Horizontal Codell Development Strong Well Performance Shows Potential for Development Across Wattenberg Large exposure with nearly all acreage having horizontal Codell potential Eight producing Codell horizontals showing results…
  58. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 58
    Marcellus Reserves Summary Continued Delineation Shows Hot Spots Developing Industry activity showing development of hotspots in Harrison County Goff wells continue to out-perform type curves Modeling data and well results…
  59. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 59
    Significant 3P Reserves Growth (MMBoe) Large Gains in 3P Reserves Excluding Utica Potential Development of Wattenberg continues to add significant 3P reserves to PDCs portfolio Continued delineation of the horizontal Codell…
  60. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 60
    George Courcier Vice President Marketing and Midstream 4/4/2013 62
  61. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 61
    Recent Midstream Focus/Activity Wattenberg Long-term midstream infrastructure capacity and takeaway options Diversify crude oil marketing options Utica Implementing short-term gas gathering and processing along with condensate…
  62. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 62
    Wattenberg Midstream Infrastructure Expansion DCP Expansions Will Relieve Gathering System Bottlenecks and Provide Processing Capacity for Expanded Development Plants and compression built within PDCs acreage area Temporary by-pass on…
  63. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 63
    Wattenberg Marketing Netbacks Calculated After Gathering, Processing, POP Contracts, and Other Fees 4/4/2013 65
  64. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 64
    Utica Midstream/Marketing Objectives Finalize Long-Term Midstream Agreements to Facilitate Development Plans Recently implemented short-term solution for Guernsey County Recently signed midstream agreement with MarkWest for Guernsey…
  65. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 65
    Utica Marketing Netbacks Calculated After Gathering, Processing, POP Contracts, and Other Fees Current natural gas and NGL sales coming from refrigeration processing skid at location Long-term midstream services in Guernsey Co. via…
  66. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 66
    PDCM Marcellus Netbacks & Midstream Continuing Building Large Diameter, High Pressure Midstream Solutions for Marcellus Acreage Existing pipeline 18 miles of 812 diameter 2013 Construction 3.5 miles of 16 diameter 2014…
  67. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 67
    Long-Term Midstream & Marketing Goals UTICA Finalize long-term gathering and processing agreements Maximize product realizations through continued marketing efforts WATTENBERG PDCM MARCELLUS Continue to work with midstream…
  68. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 68
    Gysle Shellum Chief Financial Officer 4/4/2013 70
  69. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 69
    Financial Guidance Update Capital investment emphasis on oil and liquid-rich projects, with proceeds from Piceance and NECO divestiture allocated to Wattenberg and Utica 27% - 36% projected increase in production from continuing…
  70. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 70
    2013 Consolidated Financial Guidance In Millions, Except for Per Share Data YE 2012 2013 Guidance Actual Low High Production (MMBoe) 5.5 (1) 7.0 7.5 Natural gas, NGL and crude oil sales 238 297 377 Realized gain on derivatives 49 38 4…
  71. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 71
    2013 Debt & Liquidity Analysis 2012 Actual 2013 Estimate 2013 Estimate 2013 Estimate Consolidated PDC Only PDCM Consolidated Beginning Debt (MM) (Credit Facility) 209 49 26 75 - Adjusted Cash Flow From Ops (164) (175) - (193) (11) -…
  72. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 72
    2013 Guidance, Contd Continued weak gas prices Hedges and strip pricing at 02/28/2013 2013 projected realized hedge gain 4 - 38 million vs. 49 million in 2012 Measure (/Boe) 2012 2013 Guidance Wellhead Price 43.30 42.43 - 50.27…
  73. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 73
    Debt Maturity Schedule in Millions 450 million revolver matures in Debt Maturity Schedule(1) November 2015 600 115 million 3.25% convertible 500 500 debentures mature in May 2016 450 Drawn 03/01/2013 Undrawn Revolver ( in…
  74. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 74
    Crude Oil and Natural Gas Hedges Hedges in Place as of March 26, 2013 Pro-forma for Non-core Colorado assets divestiture Crude Oil (includes NGL) FY 2013 FY 2014 FY 2015 NYMEX Average(1) 92.97 90.67 87.72 Weighted-Average Hedge…
  75. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 75
    Weighted Average Cost of Capital (WACC) Analysis As of As of 12/31/2011 12/31/2012 Cost of Equity 15.2% 14.8% Equity % 61.0% 60.0% After Tax Cost of Debt 5.5% 4.7% Debt % 39.0% 40.0% WACC 11.4% 10.7% (1) PDC Energy 7.75%…
  76. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 76
    Lance Lauck Senior Vice President Corporate Development 4/4/2013 78
  77. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 77
    Key Accomplishments Strategic Positioning Grows Value for PDC Shareholders Positioned Company for long-term growth from three Premier Horizontal Plays Inventory of over 2,200 liquid-rich, high-value horizontal locations in Core…
  78. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 78
    Recent Strategic Transactions Focus on Liquids Through Business Development Key Transactions Completed PDCs Transition to Liquids Core Wattenberg Acquisition Utica Leasehold Acquisition Colorado Dry Gas Divestiture - Pending…
  79. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 79
    Non-Core Colorado Asset Divestiture Enables PDC to Accelerate LiquidRich Horizontal Drilling Colorado Natural Gas Assets: Piceance, NECO, Krieger, SECO Offer Amount: 200 million1 cash Includes certain PDC hedges for 2013-2015…
  80. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 80
    Positioned for Value Creation 2013 Initiatives Solution 1 Fully Fund 2013 Capital program 2 Improve Margins; Revenues, Cash, Earnings Non-Core Colorado Asset Divestiture and Accelerated Liquid-Rich Horizontal Drilling 3…
  81. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 81
    2013-2015 Business Strategy Focus on Creating Shareholder Value through Organic Growth Three Premier Horizontal Basins: Core Wattenberg, Utica, Marcellus Grow production and reserves Objectives Grow cash flow and earnings Grow…
  82. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 82
    Production Growth Outlook 2013E to 2015E Strong Production Growth Forecasts with Significant Liquids Mix Production Growth Outlook Range (MMBoe) 3-Year Average Production Mix 18 16 53% 14 47% Liquids Gas 12 10 8 6…
  83. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 83
    Cash Flow Per Share Outlook 2013E to 2015E Adjusted Cash Flow / Share Outlook Range Cash Margin / Boe(1) Trailing 3 Yr. 16 40 2010-2012 Weighted 30 Average 14 20 12 10 - 10 T3YR 2013 E 2014 E 2015E 8 Earnings / Share…
  84. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 84
    Capital Outlook 2013E to 2015E Accelerating Value Creation Through Expanding Organic Drilling Corporate Capital Outlook Range Horizontal Wells Drilled 800 180 160 140 700 120 100 80 600 60 40 20 500 0 2013E 2014E 2015E 400…
  85. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 85
    PDCE Share Count Leverage to Core Wattenberg Acreage PDCE Most Leveraged To High Return/Low Risk Wattenberg Asset Amongst Acreage Holders Core Wattenberg Acreage (Thousands of Acres) IRRs of U.S. Onshore Basins(1) 450 410 0% 10% 20%…
  86. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 86
    Long Term Vision Accelerate growth of production, reserves and cash flow per share Demonstrate value of our low-risk, high-return horizontal inventory Increase cash margins and earnings per share Maintain liquids mix above 50%…
  87. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 87
    Question & Answer Period 4/4/2013 89
  88. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 88
    Investor Relations Ron Wirth, Vice President Finance and Treasurer ron.wirthpdce.com Mike Edwards, Senior Director Investor Relations michael.edwardspdce.com Marti Dowling, Investor Relations Manager marti.dowlingpdce.com Corporate…
  89. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 89
    Appendix 4/4/2013 91
  90. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 90
    PDCE + PDCM = PDC Consolidated In Millions Except For Per Share and BOE Data PDC Year Ended 12/31/2012 PDCE Net PDCM Consolidated Statement of Operations (1) Natural gas, NGL and Crude oil sales 222 16 238 Commodity price risk…
  91. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 91
    2012 Discontinued Operations Piceance and NECO basins have been 2012 Production reclassified and reflected as discontinued Production from continuing operations 5.5 MMBoe operations in 2012 Production from discontinued operations…
  92. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 92
    PDC Energys Cost of Capital as of 12/31/2012 Cost of Equity Cost of Debt Capital asset pricing model (CAPM) 4.7% = 7.2% x (10.35) 14.8% = 1.8% + (1.63 x 8.0%) Risk-Free Equity Risk After-Tax Cost Pre-Tax Cost Marginal Tax…
  93. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 93
    PDC Energys cost of capital as of 12/31/2011 Cost of Equity Cost of Debt Capital asset pricing model (CAPM) 5.5% = 8.5% x (10.35) 15.2% = 1.9% + (1.56 x 8.5%) Risk-Free Equity Risk After-Tax Cost Pre-Tax Cost Marginal Tax…
  94. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 94
    2012 Metrics Capital Spending (MM) Average Sale Price excludes gain/loss on derivative (/Boe) (1) 700 627 40.00 36.90 35.00 33.78 32.70 600 480 30.00 500 25.14 25.00 400 321 20.00 300 15.00 200 143 10.00 100 5.00 - 0.00 2009…
  95. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 95
    2012 Credit Ratios PDC has Maintained Relatively Low Leverage and Strong Liquidity Conservative Leverage Strong Liquidity (1) (MM) 4.0x 60% 500 50% 45% 50% 400 384 357 3.0x 34% 3.1x 40% 33% 2.8x 300 238 2.0x 30% 1.9x 200 180…
  96. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 96
    Adjusted Net Loss Reconciliation From Net Income (Loss) in millions, except share and per share data Year Ended December 31, 2012 2011 Net income (loss) (130.7) 13.4 Unrealized (gain) loss on derivatives, net (1) 17.1…
  97. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 97
    Adjusted Cash Flows From Operations Reconciliation From Net Cash From Operating Activities in millions, except share and per share data Year Ended December 31, 2012 2011 Net cash from operating activities 174.7 166.8 Changes…
  98. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 98
    Adjusted EBITDA Reconciliation From Net Income (Loss) in millions, except share and per share data Year Ended December 31, 2012 2011 Net income (loss) (130.7) 13.4 Unrealized (gain) loss on derivatives, net (1) 17.1 (28.6)…
  99. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 99
    Adjusted EBITDA Reconciliation From Net Cash From Operating Activities in millions, except share and per share data Year Ended December 31, 2012 2011 Net cash from operating activities 174.7 166.8 Interest expense, net 48.3…
  100. ANALYST DAY: NEW YORK CORRECTION TO SLIDE 22 – PDC Energy, Inc. – slide 100
    PV-10% Reconciliation 2010 2011 2012 PV-10% 693.1 1,350.3 1,708.9 Present value of estimated future income tax (204.7) (409.1) (540.4) discounted at 10% Standardized measure of discounted future net 488.4 941.2 1,168.5 cash…

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