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Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp

Cabot Oil & Gas Corp · Mar 18, 2013 · 29 slides

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Slides

  1. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 1
    Investor Presentation Howard Weil Energy Conference New Orleans, LA March 18, 2013
  2. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 2
    KEY INVESTMENT HIGHLIGHTS Over 33,000 000 identified drilling locations in the sweet spot of the Marcellus Shale Extensive Inventory of with rates of return that rival or exceed all of the top U.S. liquids plays at current commodity…
  3. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 3
    ASSET OVERVIEW 2012 Production: 267.7 Bcfe 2012 Year-End Proved Reserves: 3.8 Tcfe Marcellus Shale 200,000 net acres 2012 Drilling Activity: 69.7 net wells Current Rig Count: 5 Marmaton Penn Lime 70,000 net acres 2012…
  4. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 4
    PROVEN TRACK RECORD OF PRODUCTION GROWTH 400 350 300 267.7 2013 Bcfe 250 Guidance: 35% - 50% 200 187.5 Li id (Net) Liquids (N t) 42.8% Gas (Net) 150 130.6 43.5% 100 50 0 2010 2011 2012 2013E
  5. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 5
    AND RESERVE GROWTH 4.5 4.0 3.8 3.5 30 3.0 3.0 2.7 26.7% 2.5 12.3% Tccfe 2.1 Liquids (Net) 2.0 31.1% Gas (Net) 1.5 1.0 0.5 0.0 2009 2010 2011 2012 2013E
  6. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 6
    POSITIVE RESERVE REVISIONS DESPITE LOW NATURAL GAS PRICES 370 927 (115) (67) (38) 3,842 (268) 3,033 Bccfe Year-End 2011 Additions Performance Pricing Deletions Sales Production Year-End 2012 Proved Revisions Revisions…
  7. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 7
    SUPERIOR RESERVE REPLACEMENT AND FINDING COSTS Reserve Replacement Ratio 700% 603% 600% 500% 443% 417% 390% 400% 300% 255% 200% 100% 0% 2008 2009 2010 2011 2012 All-Sources F&D Costs 4.00 3.42 3.00 2.26 /Mcfe…
  8. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 8
    PEER LEADING PRODUCTION AND RESERVE GROWTH Production Per Debt-Adjusted Share CAGR (2010 2012) 42% 30% 26% 24% 22% 17% 16% 15% Peer median: 11% 8% 8% 2% (0%) (2%) (3%) (9%) COG Peer A Peer B Peer C Peer D Peer E Peer F Peer G…
  9. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 9
    DISCIPLINED CAPITAL SPENDING FOCUSED ON THE DRILL-BIT 2012 Capital Program: 979 million 2013 Capital Program: (809 million net of JV and asset sales) 950 million - 1.025 billion Other Other 10% 5% Eagle Ford / Marmaton / Eagle…
  10. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 10
    INDUSTRY LEADING COST STRUCTURE Operating Transportation Taxes O/T Income G&A Financing 2.47 2.50 0.57 2.12 2.00 0.52 1.76 1 67 1.67 0.42 0.38 0.26 1.30 - 1.70 1.50 / Mcfe 0.40 0.20 0.25 0 43 0.43 0.25 0 27…
  11. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 11
    USE OF PROCEEDS FOR POTENTIAL FREE CASH FLOW IN 2014 Broker 75mm Estimate 17mm Range: Broker Implied 1,361mm Estimate Free Cash Range: Flow 1,894mm 900mm Median: 1,250mm 376mm Median: Median: 1 579mm 1,579mm 1,111mm…
  12. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 12
  13. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 13
    CABOT MARCELLUS SUMMARY Wells Producing: 197 H H, 39 V WOPL: 14 wells (235 Stages) Completing: 8 wells (179 Stages) WOC: 11 wells (204 Stages) Horizontal Rigs: 5 Cumulative Production 7+ BCF Reilly Pad 6-7 BCF Zick Pad…
  14. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 14
    EVOLUTION OF CABOTS MARCELLUS PROGRAM 2013 and 2010 2011 2012 beyond 13% HBP 29% HBP 43% HBP Expected to be 60% HBP Reduced stage spacing from Drilling days reduced Implemented 200 ft. stage by year-end 2013 300 ft. to 250 ft.…
  15. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 15
    CONTINUED PERFORMANCE IMPROVEMENTS IN THE MARCELLUS Horizontal Length Average IP and 30 30-Day Day Rate 4.5 4.1 20.0 3.8 16.8 17.4 4.0 3.4 15.1 14.5 3.5 15.0 14.0 d Ft. 30 3.0 2.7 11 9 11.9 Mmcfpd d Thousand 2.5…
  16. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 16
    MARCELLUS OPERATING EFFICIENCIES Drilling Days to TD 40 32 30 26 Days 20 20 16 10 Record of 10 days 0 2009 2010 2011 2012 Completion Cost Per Stage 200 180 165 150 ge 150 000s Per Stag 105 100 50 0…
  17. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 17
    EVOLUTION OF MARCELLUS FRAC STAGE SPACING 125 ft. 50 ft. ft Composite Bridge Plug Avg. Lateral Length 3,500 ft. Avg. Number Stages 10 2 ft. perf cluster 6 SPF Avg. EUR 8.0 Bcf (Shots per foot) 350 ft. Spacing 75 ft. 50 ft.…
  18. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 18
    CABOT HAD 15 OF THE TOP 20 PA MARCELLUS HORIZONTAL WELLS IN 2012 8.0 Cabot is the only publicly-traded company in the top 20 7.0 6.0 n (Bcf) 50 5.0 Cumulativve Production 4.0 3.0 2.00 1.0 0.0 PEER PEER COG…
  19. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 19
    MARCELLUS PROGRAM OVERVIEW AND ECONOMICS 2012 Program Highlights 2013 Planned Activities 69.7 net wells drilled Operate 5 rigs for the majority of the year 6 wells turned in line with an EUR over 20 Bcf Expect to spud 85 wells Fastest…
  20. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 20
    HYPOTHETICAL 10-WELL PAD WITH 160+ POTENTIAL STAGES Current Hypothetical 2 well pad 10-well 2-well 10 well pad Location & road costs / well 200,000 40,000 Rig mobilization / well 175,000 35,000 Frac mobilization / well 110,000…
  21. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 21
    GROWING CAPACITY IN THE MARCELLUS 2013 program: Right-of-ways Ri ht f and d permits it essentially ti ll complete l t Compression 2014 program: Right-of-ways essentially complete and permitting on schedule Exit rate gathering /…
  22. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 22
  23. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 23
    EAGLE FORD AND PEARSALL Austin Chalk S Antonio San A t i target Eagle Ford Powderhorn Presidio Buda Del Rio Shale Buckhorn Georgetown Edwards Glen Rose Rodessa Upper Bexar Lower Bexar target Pearsall target Cow…
  24. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 24
    EAGLE FORD - BUCKHORN All Wells W ll D Down-spacing i R Results lt Average 30- EUR / Lateral Wells Drilled: 44 Day Rate Foot Stages (Boepd) (Boe) Current Drilling: 1 Spacing Well A 23 766 79 g Wells Producing: 41 1 200 1,200…
  25. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 25
    PEARSALL SHALE 4 Pearsall wells with 30+ days of production Wells Drilled: 9 30-day average production rate: 631 Boepd Current Drilling: 3 56% oil Wells Producing / Flowing Back 5 Drilling days: 40-45 days spud to spud Average…
  26. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 26
    PENN LIME MARMATON Extended Reach Laterals 4 extended reach lateral wells drilled to date with 3 wells currently producing Average lateral length: 9,300 N Beaver Average frac stages per well: 30 Average g EUR: 230 Mboe Texas…
  27. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 27
    U.S. NATURAL GAS DEMAND DRIVERS CONTINUE TO LOOK FAVORABLE O 45 gigawatts Over i tt off coal-fired l fi d generating ti capacity it is i estimated ti t d to t be b retired ti d between b t 2012 andd 2016... 2016 25.0 22.4…
  28. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 28
    RESULTING IN A POSITIVE OUTLOOK FOR LONG-TERM DEMAND N pipeline New i li systems t in i Mexico M i could ld potentially t ti ll add dd 5.1 51B Bcf/d f/d off incremental i t l exportt capacity it bby 2016 6.0 5.1 3.7 4.0…
  29. Howard Weils 41st Annual Energy Conference – Cabot Oil & Gas Corp – slide 29
    INVESTMENT SUMMARY Simple Growth Story 3,000+ Remaining Locations in the Sweet Spot of the Marcellus Shale Transitioning from Acreage Capture to Efficient Pad Development p byy 2014 Cash Flow Positive Investment Program in…

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