June 2012 Investor Presentation JUNE 2012 INVESTOR PRESENTATION
June 2012 Investor Presentation ESCAPING GRAVITATIONAL PULL OF WEAK NG PRICES NOT EASY, BUT WE WILL DO IT 150 CHK NYMEX Natural Gas(1) NYMEX Oil (1) Dow Jones Index 120 DJIA Oil Normalized 90 60 CHK Source:…
June 2012 Investor Presentation LIQUIDS GROWTH WILL PROVIDE THE LIFTOFF CHK has 2nd best liquids production growth story in the U.S., and one of the best in the world 30,000 bbls/d in 4Q09 to 114,000 bbls/day in 1Q 12, increase of…
June 2012 Investor Presentation AGGRESSIVELY SHIFTING CAPITAL TO LIQUIDS-RICH PLAYS Total Dry Gas Capex Total Liquids Capex During 2011, CHK substantially reduced 100% 8% % of CHK Operated Drilling and Completion Capex…
June 2012 Investor Presentation 2013E E&P CAPEX FLEXIBILITY (1) E&P Capex by Play E&P Capex Allocation 4,500 4,000 3,500 3,000 ( in mm) 2,500 2,000 1,500 1,000 500 0 Estimated Operated Operated Non-Operated…
June 2012 Investor Presentation CHKS PROJECTED FUTURE GROWTH IS 100% LIQUIDS 800,000 40% NGL Oil 700,000 Associated natural gas from liquids plays 150,000 bbls/d average in 2013 Natural gas from shale plays 115,000 bbls/d…
June 2012 Investor Presentation CHK OWNS A PREMIER COLLECTION OF U.S. E&P ASSETS
June 2012 Investor Presentation marcellus utica haynesville eagle ford andarko basin powder river basin anadarko basin mississippi lime mississippian lime marcellus utica haynesville eagle ford andarko basin powder river basin anadarko…
June 2012 Investor Presentation PREMIER COLLECTION OF E&P ASSETS IN THE U.S. During past seven years of Unconventional Resource Revolution in the U.S., CHK captured Americas largest natural gas and liquids resource base 19.8 tcfe,…
June 2012 Investor Presentation EAGLE FORD SHALE OVERVIEW CHK is the second-largest leasehold owner in the play with 475,000 net acres CHK has allocated 30% and 40% of 2012 and 2013 drilling budgets, respectively YTD gross…
June 2012 Investor Presentation MISSISSIPPI LIME OVERVIEW CHK Leasehold Operated Rigs CHK is largest leasehold owner in the play with 2.0 Non-operated Rigs Industry Rigs mm net acres Production for 1Q12 averaged 12,800 boe/d,…
June 2012 Investor Presentation UTICA SHALE OVERVIEW CHK Leasehold Operated Rigs CHKU Outline CHK/TOT JV CHK is largest leasehold owner in the play with 1.3 Outline Non-operated Rigs Industry Rigs mm net acres Oil Window…
June 2012 Investor Presentation CLEVELAND AND TONKAWA OVERVIEW Tonkawa Cleveland CHK Leasehold Operated Rigs CHK owns 520,000 net acres of leasehold CHK C-T Non-operated Rigs Industry Rigs in the Cleveland play and 285,000…
June 2012 Investor Presentation FINANCIAL SUMMARY
June 2012 Investor Presentation CHK HAS DELIVERED STRONG OPERATIONAL AND FINANCIAL RESULTS FOR YEARS... (1) Production Proved Reserves 1,500 30,000 1,000 20,000 Bcfe Bcfe 500 10,000 0 0 Adjusted…
June 2012 Investor Presentation AND ALSO STRONG PER SHARE RESULTS WHILE ALSO DECREASING DEBT (1) Production/Weighted Average Fully Diluted Share Proved Reserves/Fully Diluted Share 2.0 40 mcfe/weighted avg. fully diluted…
June 2012 Investor Presentation 2012 AND 2013 OUTLOOK SUMMARY 2011 YE 2012E YE 2013E Production Liquids (mbbls) 31,676 41,000 - 43,000 55,000 - 59,000 Natural gas (bcf) 1,004 1,040 - 1,060 970 - 1,010 Natural gas equivalent…
June 2012 Investor Presentation 2012 FINANCIAL PROJECTIONS AT VARIOUS NATURAL GAS PRICES As of 05/01/12 Outlook ( in mm; oil at 100 NYMEX) 2.00 3.00 4.00 O/G revenue (unhedged) 1,302 bcfe (1) 4,180 4,800 5,410 (2) Hedging effect…
June 2012 Investor Presentation 2013 FINANCIAL PROJECTIONS AT VARIOUS NATURAL GAS PRICES As of 05/01/12 Outlook ( in mm; oil at 100 NYMEX) 3.00 4.00 5.00 O/G revenue (unhedged) 1,332 bcfe (1) 6,160 7,150 8,140 (2) Hedging effect…
June 2012 Investor Presentation 2012 FINANCIAL PLAN UPDATE CHK recently announced three monetizations in April 2012 for 2.6 billion VPP 10 on assets in Anadarko Basin Granite Wash play for proceeds of 745 million or 4.68/mcfe…
June 2012 Investor Presentation CASH IN AND OUT SUMMARY YE 2012E YE 2013E Operating cash flow (mm) (1)(2) 2,700 - 3,000 4,400 - 5,300 Well costs on proved properties (6,500 - 7,000) (5,500 - 6,000) Well costs on unproved…
June 2012 Investor Presentation CHK HEDGING PROGRAM BEST IN INDUSTRY Quarterly Realized Gains and Losses 1Q '06 - 1Q '12 800 4.00 Realized Gains/Losses ( in millions) 600 3.00 per mcfe of production 400 2.00 200…
June 2012 Investor Presentation HEDGING POSITION (1) Natural Gas Liquids % of % of NYMEX NYMEX Forecasted Forecasted Natural Gas Oil WTI Production Production 2Q - 4Q 2012 --- --- 60% 103.02 2013 --- --- 9% 102.86 In…
June 2012 Investor Presentation SENIOR NOTE MATURITY SCHEDULE (1) 2,500 Total Senior Notes: 10.6 billion 2,287(2) Average Maturity: 6.4 years 2,000 1,950 1,800 1,660(2) 1,489(2) 1,500 Bank credit facilities with…
June 2012 Investor Presentation STRONG HISTORICAL NAV PER SHARE GROWTH SHOULD CONTINUE IN 2012 (Based on constant pricing) ( in mm except per share data) 2006 2007 2008 2009 2010 2011 Proved reserves at PV10 (4.50/mcf & 100/bbl)…
June 2012 Investor Presentation REMARKABLE VALUE OPPORTUNITY FOR TODAYS INVESTORS ( in millions except share price) Price per share 15.00 20.00 25.00 30.00 (1) Fully diluted common shares 3/31/12 769 769 769 769 Market…
June 2012 Investor Presentation SUMMARY
June 2012 Investor Presentation SUMMARY 25/25 Plan for 2011 - 2012 Increase production by 25% (net of asset sales) and reduce long-term debt by 25% Inflection Point on Natural Gas to Liquids Transition Rapidly shifting from 90%…
June 2012 Investor Presentation APPENDIX: INCREASING NATURAL GAS DEMAND
June 2012 Investor Presentation TIME TO GET BULLISH ON OUT YEAR NATURAL GAS YES, WE ARE SERIOUS Yes, many reasons to be bullish on intermediate and long-term natural gas prices despite warm winter and overwhelmingly negative…
June 2012 Investor Presentation WHAT IS CHK DOING GENERALLY TO INCREASE NATURAL GAS DEMAND As a producer of 9% of America's gross natural gas supply, CHK is deeply engaged in the effort to increase natural gas demand. The general…
June 2012 Investor Presentation WHAT IS CHK DOING SPECIFICALLY TO INCREASE NATURAL GAS DEMAND With 160 mm commitment from CHK, led a total 400 mm investment in Clean Energy Fuels (NYSE: CLNE) to help build out Americas Natural Gas…
June 2012 Investor Presentation 4 CORNERSTONES OF INCREASED NATURAL GAS DEMAND Industrial Power Generation Transportation Exports Increased and diversified demand will help balance the U.S. natural gas market and create…
June 2012 Investor Presentation INDUSTRIAL DEMAND Rapidly increasing, domestic natural gas, natural gas liquids and oil production is a powerful lever for increasing American jobs An increased focus on natural gas liquids (NGL)…
June 2012 Investor Presentation POWER DEMAND: BIG OPPORTUNITY FOR FUEL SWITCHING Increase utilization of natural gas in the power generation sector 300,000 MWs of coal generation capacity 40,000 70,000 MWs likely retired by 2020…
June 2012 Investor Presentation TRANSPORTATION DEMAND: AMERICA MUST GET OFF THE OIL BOTTLE U.S. consumes 23% of the worlds oil, 19 mm bbls/day, of which 11 mm bbls/day is imported By 2020, the IEA predicts world oil consumption…
June 2012 Investor Presentation CAN AMERICA DEAL WITH 5/GALLON GASOLINE OR DIESEL Current domestic and international challenges will likely keep upward pressure on the price of diesel in 2012 and beyond Will Israel Attack Iran…
June 2012 Investor Presentation NATURAL GAS VEHICLES ARE AN ANSWER TO RISING FUEL PRICES Price of Oil vs. Natural Gas If NYMEX is 4.00/mcf Forward Spread CNG will be 1.50/dge Pre-2005 Historical Spread 2005-2010 Avg. Spread /bbl…
June 2012 Investor Presentation THE MARKET IS MOVING EVEN IF FEDERAL GOVERNMENT IS NOT New bi-fuel trucks and vans to be introduced by Ford, Chrysler (Dodge), and General Motors in 2012 New natural gas HD truck engines by…
June 2012 Investor Presentation TRANSPORTATION INFRASTRUCTURE IS GROWING Current and Potential CHK Partners Cody Bakken Gammon Mowry Baxter/Mancos Antrim Marcellus Utica Niobrara Mancos New Albany Mulky Granite Wash…
AMERICAS NATURAL GAS HIGHWAY June 2012 Investor Presentation COMPLETE IN 2013 LNG truck fueling coast-to-coast and border-to-border 41
June 2012 Investor Presentation CNG IN A BOX CHK working with GE to deploy more than 250 of GEs ecomagination- qualified CNG In A Box fueling systems across the U.S. through 2015 through CHKs affiliate, Peake Fuel Solutions…
June 2012 Investor Presentation TOP 10 REASONS WHY NATURAL GAS WILL COMPETE IN TRANSPORTATION SECTOR 1. Price of oil vs. price of natural gas is simply too huge to ignore 2. Pricing fundamentals for CNG and LNG in relation to a Mcf…
June 2012 Investor Presentation TRANSPORTATION: LOTS OF OPPORTUNITIES FOR NATURAL GAS ACROSS THE BOARD Transportation Market Daily Demand Market Size (Bcf) Market Opportunities LD Vehicles 45 General Motors, Chrysler, Honda, Ford…
June 2012 Investor Presentation EXPORTS: NORTH AMERICAN LNG REGAS FACILITIES CONSIDERING LIQUEFACTION Kitimat British Columbia, Canada Contemplated LNG export volumes are 10 bcf/day (Approved by Canadas National Energy Board) (does…
June 2012 Investor Presentation CORPORATE INFORMATION Corporate Contacts: Chesapeake Headquarters Jeffrey L. Mobley, CFA 6100 N. Western Avenue Senior Vice President Oklahoma City, OK 73118 Investor Relations and Research Web…
June 2012 Investor Presentation CERTAIN RESERVE & PRODUCTION INFORMATION The Securities and Exchange Commission requires natural gas and oil companies, in filings made with the SEC, to disclose proved reserves, which are those…
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