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2Q 2014 Earnings Conference Call – Devon Energy Corp

Devon Energy Corp · Aug 6, 2014 · 26 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. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 1
    Second-Quarter 2014 Earnings Conference Call August 6, 2014
  2. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 2
    Second-Quarter 2014 Highlights Completed portfolio transformation announced late last year Contracted to sell U.S. non-core assets for 2.3 billion Delivered U.S. oil production growth of 79% year over year(1) Achieved excellent…
  3. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 3
    Delivering Strong Oil Growth Q2 2014 Results Total Oil Production (1) U.S. Oil Production (1) Q4 2014e Product Mix (1) (MBOD) (MBOD) 205 153 128 37% 43% 71 20% Q2 2013 Q2 2014 Q2 2013 Q2 2014 U.S. Canada Oil NGLs…
  4. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 4
    Higher Revenues & Expanding Margins Oil-Weighted Upstream Revenue Pre-Tax Cash Margin per BOE (1) Increased 42% Year over Year Q2 2014 Revenue Mix 30.47 12% 21.82 61% 27% Q2 2013 Q2 2014 Oil NGLs Natural Gas (1)…
  5. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 5
    Non-Core Asset Sales Sharpening The Focus Announced U.S. non-core assets sale for 2.3 billion (June 30, 2014) Accretive transaction: 7 times 2013 EBITDA Expected to close in the third quarter of 2014 Total U.S. & Canadian…
  6. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 6
    Devon Today Sharpening The Focus Devons Core & Emerging Assets Q2 2014 net production: 620 MBOED(1) Oil & NGLs 60% of production by year-end Heavy Oil Core Deep inventory of oil opportunities Emerging Top-tier Eagle Ford…
  7. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 7
    2014 Production Growth Targets Total Oil Production (1) U.S. Oil Production (1) BOE Production (1) (MBOD) (MBOD) (MBOED) 579 - 622 198 - 216 539 152 124 - 136 73 2013 2014e 2013 2014e 2013 2014e U.S. Canada 6:1…
  8. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 8
    2014 E&P Capital Program Delivering Strong Oil Growth 2014 E&P Capital Budget E&P Capital % of 5.0 - 5.4 Billion (1) Spent (B) (1) Budget 2% 5% Q1 2014 1.2 23% 5% Q2 2014 1.3 24% 7% 28% 1st Half Total 2.5 47% 11% 0.1…
  9. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 9
    Potential Drop Down Asset Access Pipeline (Heavy Oil Midstream) JACKFISH & PIKE Three 180 mile pipelines from Sturgeon Terminal to Devons thermal acreage 30 miles of dual pipeline from Sturgeon Terminal to Edmonton Devon…
  10. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 10
    Potential Drop Down Asset Victoria Express Pipeline (VEX) (Eagle Ford) 56 mile crude oil pipeline from Eagle Colorado Gonzales Ford core to Port of Victoria terminal Lavaca Wharton 50 MBOPD start-up capacity (expandable)…
  11. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 11
    Preliminary 2015 Outlook Total Oil Production(1) Key Highlights (MBOD) On track to deliver 2015e oil production growth 20% (1) Driven by Eagle Ford, Permian and Jackfish 3 198 - 216 Expect top-line production in the…
  12. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 12
    Delaware Basin Delivering Outstanding Well Results Activity focused on repeatable, high-impact Bone Spring Brought 22 wells online in Q2 30-day IP rate: 660 BOED Central Eddy Recent Delaware Sands success Two high-rate…
  13. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 13
    Disciplined Risking Methodology Multi-Variant Analysis Multi-disciplinary, multi-variant Geology Geophysics analysis Utilizes geologic, geophysical, completion and production data Allows us to characterize and predict future…
  14. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 14
    Disciplined Risking Methodology Delaware Basin Inventory Gross Net Risked Risked Prospective Risk Net Risked Wells Per Undrilled Formation Acres Factor(1) Acres Section Locations Delaware Sands 160,000 50% 80,000 4 700 Leonard…
  15. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 15
    Eagle Ford Production Results and Outlook 2014 Results to Date Multi-Year Production Outlook (MBOED) (MBOED) 100 73 70 80 (1) 65 49 March 2014 Q2 2014 June 2014 2014e 2015e (1) Represents Devons estimated net…
  16. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 16
    Lower Eagle Ford Upside Lavaca County Devons Lavaca County Pavlicek Un 2H Net acres: 32,000 24-Hr IP: 1,319 BOED Zebra Hunter 2H Significant upside potential 24-Hr IP: 1,511 BOED Early results exceeding Zebra Hunter 3H…
  17. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 17
    Upper Eagle Ford Potential OKLAHOMA Sustr 1H Targac 1H Encouraging industry results 24-Hr IP: 1,054 BOED 24-Hr IP: 1,398 BOED TEXAS Pay thickest in DeWitt County Fojtik 1H 24-Hr IP: 1,209 BOED Martinsen 2H 24-Hr IP: 1,360 BOED Spud…
  18. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 18
    SAGD Heavy Oil Developments Jackfish & Pike SAGD Characteristics: Jackfish 1 T76 Low F&D Jackfish 2 Low geologic risk Flat production profile Jackfish 3 T75 Long reserve life 20 years Jackfish 1 & 2: T74 Pike Project Area…
  19. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 19
    Jackfish SAGD Developments Significant Free Cash Flow Generation Free Cash Flow Outlook 1,200 1,000 800 in millions 600 400 200 0 2014e 2015e 2016e 2017e 2018e 2019e 2020e 2021e 2022e 2023e 2024e 2025e…
  20. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 20
    Cana-Woodford Completions Enhanced Old Design: 10 Frac Stages 40 Perf Clusters Sand: 3.5 MM lbs. Fluid: 130k Bbls. New Design: 20 Frac Stages 80 Perf Clusters Sand: 6.0 MM lbs. Fluid: 140k Bbls. NYSE: DVN…
  21. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 21
    Cana-Woodford Q2 Results Liquids-Rich Core 30-Day IP Rates (MBOED) EURs 1,250 (MMBOE) 920 1.7+ 1.4 2014 Type Curve Q2 Results Cost Per Well (MM) 8.0 8.0 2014 Type Curve Q2 Results 2014 Type Curve Q2 Results…
  22. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 22
    Cana-Woodford Production Revitalizing Base Production Gross Operated Production 440 420 400 Acid Treatments 380 MMCFD 360 340 320 300 Jan-14 Jun-14 Jan-15 Oct-13 Feb-14 Apr-14 Nov-13…
  23. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 23
    Cana-Woodford Acquisition Accelerating Activity Acquired 50,000 net acres (announced May 2014) Dewey Directly overlaps existing leasehold Increases Cana position to 280,000 net acres Blaine Kingfisher Improved completion design…
  24. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 24
    Rockies Oil Powder River Basin Net acreage: 150,000 MONTANA Stacked oil targets (Parkman, Turner, Frontier & others) WYOMING Activity focused on repeatable Parkman formation Two high-rate wells in Q2 Current Focus Area…
  25. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 25
    Q&A
  26. 2Q 2014 Earnings Conference Call – Devon Energy Corp – slide 26
    Non-GAAP Reconciliation Net Debt Devon defines net debt as debt less cash and cash equivalents. Devon believes that netting these sources of cash against debt provides a clearer picture of the future demands on cash to repay debt.…

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