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Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp.

Bill Barrett Corp. · Dec 10, 2014 · 37 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. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 1
    WELLS FARGO ENERGY SYMPOSIUM December 2014
  2. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 2
    Company Overview (NYSE:BBG) BBG is a Rocky Mountain based oil development company 1 billion enterprise value 500 million market cap 2 areas of operation DJ Basin, Colorado & Wyoming Uinta Oil Program, Utah 3Q14 pro forma…
  3. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 3
    Value Creation 2014 2014 Accomplished key objectives Completed transition from natural gas exploration company to oil development company Simplified portfolio to two core oil development programs Focused portfolio in DJ and Uinta…
  4. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 4
    Exceptionally Well Positioned for 2015 Low exposure to risk in challenging commodity price environment Fully hedged 2014 exit rate oil production for 2015 11,000 b/d hedged at 90 Minimal sensitivity to oil prices, estimated at less…
  5. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 5
    Hedging Provides Price Predictability Hedge on a 12-month forward basis to reduce risk and support capital expenditure program 4Q14: 1.3 MMBoe; Oil: 10,600 Bbls/d at 93.88/Bbl; natural gas: 19,158 MMBtu/d at 3.55/MMBtu 2015: 5.2…
  6. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 6
    2015 Outlook: Operating Plan in Progress Typically provide full year guidance late January Current process and considerations in a challenging environment: Reviewing range of scenarios/rig activity at multiple commodity prices…
  7. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 7
    Preliminary Look at Returns Sensitivity to commodity prices: returns hold up pre-hedge, favor XRLs Investment decisions based on merits of investment pre-hedge Northeast Wattenberg XRLs exceed 20% hurdle rate at 65 oil XRL…
  8. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 8
    Summary of September Transactions Totaling 757 million 1. Simplified portfolio 2. Focused on highest return assets 3. Strengthened balance sheet, materially reduced debt 4. Increased Northeast Wattenberg position Simplified…
  9. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 9
    Net Debt Cut by More Than 50% ( millions) 3Q14 Outstanding Balance Revolving Credit Facility - 7.625% Senior Notes due 2019 400.0 7.000% Senior Notes due 2022 400.0 5.000% Convertible Senior Notes 25.3 Lease Financing Obligation…
  10. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 10
    Delivering High Growth from Core Oil Programs Production (MMBoe) Operating Cash Flow* (MM) 8 300 6 200 4 100 2 0 0 2010 2011 2012 2013 2014e 2010 2011 2012 2013 2014e DJ UOP DJ UOP Focused capital program on Uinta and…
  11. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 11
    DJ BASIN
  12. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 12
    DJ Basin: Lots of Running Room Added 7,856 net acres September 2014 to total 84,450 Niobrara and Codell Formations Northeast Wattenberg: 49,365 net acres, up 20% Chalk Bluffs: 22,680 net acres Wattenberg interior: 12,405 net acres…
  13. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 13
    DJ Basin: Production Growth DJ Basin Net Production and Gross Operated Horizontal Wells Spud 9,000 8,270 6,000 Boe/d 3,000 1,564 0 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 Operated 13 7 2 10 21 27 20 13 14…
  14. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 14
    Northeast Wattenberg: Prime Position Among Peers Excellent position yet to be fully valued Located between BCEI positions Niobrara Formation Adjacent to NBL Wells Ranch East Pony/ BCEI Redtail Successful extended reach SYRG…
  15. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 15
    Northeast Wattenberg Driving Growth and Returns with XRLs Extended Reach Lateral Program on Track 27 drilled and completed: 15 northern (all Niobrara B), 12 southern blocks (5 Niobrara B and 7 Niobrara C) 13 have reached peak…
  16. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 16
    XRL Type Curve Performance Peer wells prove type curve over two year time period 6 peer wells in close proximity continue to follow 825 MBoe type curve (2-stream) 1,000 Average Daily Oil Production (BOPD) 100 10 Long…
  17. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 17
    Northeast Wattenberg Seeking Optimization Controlled flowbacks on all XRLs Downspacing test on four pads to mimic 40-acre spacing Increased sand volumes on 4 wells to 12 mm lbs. v. 9 mm lbs. Plug-and-perf completions on 5 wells v.…
  18. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 18
    UINTA OIL PROGRAM
  19. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 19
    Uinta Oil Program Large, Scalable Program: 150,000 net acres Wasatch, Green River Formations East Bluebell: 23,675 net acres Blacktail Ridge/Lake Canyon: 108,255* net acres South Altamont: 20,200 net acres Driving Steady Growth…
  20. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 20
    Uinta Basin: Well Positioned Among Peers Wasatch, Green River Formations DVN EPE CPG CPG QEP NFX UPL NFX LINN 10 Miles BBG Acreage 21
  21. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 21
    UOP: East Bluebell Execution East Bluebell Program Offers Substantial Upside 36,895 gross/23,675 net acres Lower Green River Development on 80-acre spacing with further downspacing planned Vertical wells targeting Lower Green River…
  22. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 22
    UOP: East Bluebell Production Growth East Bluebell Net Production and Gross Operated Wells Spud 4,000 3,100 3,000 Boe/d 2,000 1,435 1,000 0 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 Operated Wells spud 4 3 6…
  23. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 23
    Solid Foundation for Our Future 2014 accomplished what we set out to do Completed transition to oil development company with simplified two asset portfolio Increased Northeast Wattenberg position by 20% Strengthened balance sheet:…
  24. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 24
    APPENDIX
  25. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 25
    Natural Gas and Oil Hedges As of December 5, 2014 Swaps Period Oil Natural Gas Volume WTI Price Volume NWPL Price (Bbls/d) (/Bbl) (MMBtu/d) (MMBtu) 4Q14 10,600 93.88 19,158 3.55 1Q15 11,800 90.46 20,000 4.13 2Q15 11,300 90.39…
  26. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 26
    Northeast Wattenberg Driving Value Through Downspacing 5,280 Actively evaluating four downspacing pilots Two 9,300 lateral B Bench wells Two 9,300 lateral C Bench wells staggered beneath B Bench locations All testing areas on…
  27. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 27
    DJ Basin Operating Efficiencies Average 4,000 Lateral Drilling Average Drilling Cost per Foot Days 18 17.1 200 173 11.8 150 12 10.1 108 97 100 6 50 0 2012 2013 2014 YTD 0 2012 2013 2014 YTD Standard reach…
  28. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 28
    DJ Basin: 20% Increase in Northeast Wattenberg Position 7,900 net acres acquired increasing NE Wattenberg 20% to 49,365 net acres Southern Acreage Block Northeast Wattenberg Post- Post- YE2013 Transaction YE2013 Transaction Gross…
  29. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 29
    DJ Basin Infrastructure Existing local oil refining capacity and rail infrastructure 350mbbls/d Capacity Capacity Expansion Projects Timing (MBbls/d) Pony Express Pipeline 230 In Service White Cliffs Expansion 75 In Service Pony…
  30. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 30
    DJ Basin Infrastructure Expected Capacities Cheyenne Crude Terminal 52mbbls/d Pony Express Conversion In Service: 230-320mbbls/d Pony Express NE CO Lateral 1Q15: 90mbbls/d Suncor Refinery: 96MBbls/d White Cliffs…
  31. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 31
    East Bluebell Production Efficiencies Average Drilling Days Average Drilling Cost per Foot 20.0 200 18.1 184 15.0 14.3 150 113 10.0 10.0 100 93 5.0 50 0.0 0 2012 2013 2014 YTD 2012 2013 2014 YTD Operating…
  32. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 32
    Uinta Oil Program Operator Current Black/Yellow Black/Yellow Capacity Capacity (MBbls/d) Expansions (MBbls/d) Chevron 15,000 5,000 Tesoro 15,000-20,000 20,000 Holly Frontier 10,000 14,000 Big West 15,000 - Silver Eagle 12,000 -…
  33. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 33
    Low-risk, Long-term Growth Profile Year-end 2013 88% growth in proved reserves at three active oil programs 80% growth in risked resources at three active oil programs 350 million increase in Pretax PV10 8.30/Boe 2013 F&D cost…
  34. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 34
    UOP: Undeveloped Location Inventory Risked Resources (171 MMBoe) 785 Net Drilling Locations (Gross 1,795) 124 42 137 92 37 524 Blacktail Ridge/Lake Canyon Blacktail Ridge/Lake Canyon East Bluebell East Bluebell South…
  35. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 35
    DJ Basin Year-end 2013 Undeveloped Location Inventory 844 Net Undeveloped Locations Total Gross: 1,697 94 130 Core Wattenberg 43 NE Wattenberg (North) NE Wattenberg (South) 228 NE Wattenberg 349 (Western) Chalk Bluffs…
  36. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 36
    Capital Program 100% Directed at Oil Growth 2014 Adjusted Guidance Total capital of 560-570 MM 2014 Capital % by Area Total Production of 9.0 9.4 MMBoe Fourth quarter guidance 1.3 1.7 MMBoe Uinta Oil Program Lease Operating…
  37. Wells Fargo Securities Research Economics and Strategy 2014 Energy Symposium – Bill Barrett Corp. – slide 37
    Land Summary As of September 30, 2014 Average Gross Project Average BBG Working Area Gross Acreage Net Acreage NRI Interest Active Oil Properties Uinta Basin Uinta Oil Program Blacktail Ridge/Lake Canyon 126,710 58,160 82% 51% Minimum…

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