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IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc.

Denbury Resources Inc. · Apr 16, 2012 · 39 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. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 1
    Corporate Presentation April 2012 NYSE: DNR
  2. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 2
    A Different Kind of Oil Company Leading CO2 Enhanced Oil Recovery (EOR) Company in the U.S. with a Unique Profile 10 billion enterprise value Scale 71,532 BOE/d production (1Q12E) 8% Increase vs. 4Q11(1) Highest crude oil exposure…
  3. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 3
    Denbury at a Glance Total 3P Reserves (12/31/11) 1.3 BBOE % Oil Production (1Q12E) 93% Market Cap (3/31/12) 7.3 billion Total Net Debt (12/31/11) 2.7 billion Total Daily Production (1Q12E) 71,532 BOE/d Proved PV-10 (12/31/11)…
  4. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 4
    What is CO2 EOR & How Much Does It Recover Secure CO2 Supply Transport via Pipeline Inject into Oilfield EOR Delivers Almost as Much Production as Primary or Secondary Recovery(1) Tertiary Recovery Remaining (CO2 EOR) Oil…
  5. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 5
    Our Two EOR Target Areas: Up to 10 Billion Barrels Recoverable with EOR Denbury Rockies Region 233 Million 3P EOR Barrels Estimated 1.3 to 3.2 MT ND Billion Barrels Recoverable Greencore ID Pipeline SD Lost Cabin WY IL…
  6. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 6
    More than a Billion Barrels of Oil Potential 1,400 572 46 ...... 1,285 1,200 100% ...... 100% 86% Natural Oil Oil 1,000 Gas MMBOE 800 205 85% ...... 600 462 ...... Oil 400 77% Oil 200 0 12/31/11 +Bakken +EOR…
  7. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 7
    Gulf Coast Region: Control of CO2 Sources & Pipeline Infrastructure Provides a Strategic Advantage Summary(1) Tinsley Delhi 3 46 MMBbls Proved 148 5 36 MMBbls Tinsley Probable (2) 339 Jackson Dome Produced-to-Date 58 Delhi…
  8. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 8
    Rockies Region: Control of CO2 Sources & Pipeline Infrastructure Provides a Strategic Advantage CO2 Sources Cedar Creek Anticline 197 MMBbls(1) Existing Anthropogenic (Man-made) Proposed Coal to Gas or Liquids MONTANA DGC Beulah…
  9. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 9
    Proven Track Record Net Daily Oil Production Tertiary Operations (through 3/31/12E) Bbls/d Phase 1 Phase 2 Phase 3 Phase 4 Phase 5 Phase 7 Phase 8 36,000 32,000 28,000 24,000 20,000 30% CAGR (1999-2011) 16,000…
  10. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 10
    Oiliest Assets in the Peer Group 100% 110 90% 100 80% 90 70% 80 60% 70 50% 60 40% 50 30% 40 20% 30 10% 20 0% 10 DNR WLL CLR SD PXD CXO NBL NFX SM XEC FST RRC % Oil & NGL Revenue % Oil & NGL Production…
  11. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 11
    Compelling Economics(1) EOR Bakken 575,000 BOE / Well Gulf Coast 9.6 Million / Well Model Averages 20% Royalty NYMEX oil price 90.00 90.00 Finding & development cost: Field 9.00 21.00 Infrastructure 4.50 --- Total capital per…
  12. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 12
    Complementary Production Profiles Projected Production Profile with Same Capital Spending Capital Spending per Year Based on EOR Spending Pattern 12,000 Year MM Gulf Coast EOR Field 1 83 2 83 Bakken 3 60 10,000 4 60 5 68 6 52…
  13. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 13
    Secure CO2 Supply to Support Gulf Coast Growth 2,500 Possible 2,000 2 Tcf Probable 1,500 2.5 Tcf MMCFPD CO2 Recycle 1,000 3.3 Tcf (Proved Only) Jackson Dome Anthropogenic Supply 500 Proved 6.7 Tcf 165 MMCFPD (as…
  14. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 14
    Secure CO2 Supply to Support Rocky Mountain Growth LaBarge Field Estimated Field Size: 750 Square Miles Estimated 100 TCF of CO2 Recoverable Riley Ridge Denbury Operated 100% WI in 9,700 acre Riley Ridge Federal Unit 33% WI in…
  15. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 15
    Third Growth Platform (Bakken Area) Bakken Area 200,000 net acres Nesson 300 MMBOE of total potential Anticline 93.9 MMBOE Proved as of 12/31/2011 2011 Production 8,788 BOE/d 1Q12E Production 15,114 BOE/d 29% increase vs. 4Q11…
  16. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 16
    Strong Financial Position 1.2 billion availability under Debt to Capitalization credit facility on 12/31/11 (12/31/11) 36% Debt Unused Credit 100% Facility 1.6 billion borrowing base + (12/31/11) Cash 19 million Net debt…
  17. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 17
    2012 Summary Guidance 2012 Capital Budget 1.35 Billion(1) 2012 Production Estimate All Other 2011 1Q12E 2012E 2012E Operating area 110MM Tertiary Floods (BOEPD) (BOEPD) (BOEPD) growth 365MM 33,000- Tertiary Oil Fields 30,959…
  18. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 18
    Sources & Uses 2012E Sources of Cash (MM) (1) Estimated Cash flow from operations 90-95 NYMEX oil 1,200 - 1,400 (2) Estimated Asset sales 150 - 300 Total Estimated Sources 1,350 - 1,700 2012E Uses of Cash (MM) Capital budget…
  19. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 19
    Hedges Protect Against Downside in Near-Term(1) Crude Oil (2) 2012 2013 2nd 1st 2nd 3rd 4th 1st Quarter 2nd Half Quarter Quarter Quarter Quarter Quarter Approximate production hedged (3) 85% 85% 85% 85% 80% 70% 25% Principal…
  20. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 20
    Sustainable EOR Growth through 2020 (1) 140,000 1,400 Expected Peak EOR Cap-Ex Estimated EOR Production (Bbls/d) Estimated EOR Capital Budget (MM) 120,000 120,000 1,200 100,000 100,000 1,000 EOR 2012E Cap-Ex 80,000…
  21. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 21
    Estimated EOR Peak Production Rates (as of 12/31/11) Estimated Peak Production Rate Produced Proved 2P&3P First (Net MBOE/d) Expected Operating Area to date (1) Remaining Remaining(2) Production Peak…
  22. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 22
    IN SUMMARY: A Different Kind of Oil Company Leading CO2 Enhanced Oil Recovery (EOR) Company in the U.S. with a Unique Profile Significant strategic advantage in CO2 EOR Large additional crude oil growth platform in the Bakken CO2…
  23. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 23
    Corporate Information Corporate Headquarters Denbury Resources Inc. 5320 Legacy Drive Plano, Texas 75024 Ph: (972) 673-2000 denbury.com Contact Information Phil Rykhoek Chief Executive Officer (972) 673-2000 Mark Allen…
  24. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 24
    Appendix
  25. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 25
    CO2 Operations: Oil Recovery Process CO2 PIPELINE - from Jackson Dome INJECTION WELL - Injects CO2 in dense phase PRODUCTION WELLS Produce oil, water and CO2 Oil Formation (CO2 is recycled) CO2 moves through formation…
  26. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 26
    CO2 EOR Generalized Type Curve Plateau Production Rate Incline (Yrs) Plateau (Yrs) Decline (Yrs) Large Fields 6 6.5 30 Average Fields 4.5 5.5 25 Small Fields 4 5 20 27
  27. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 27
    Production by Area (BOE/d) Operating area 1Q11 2Q11 3Q11 4Q11 2011 1Q12E(1) 2012E(1) Tertiary Oil Fields 30,825 30,771 31,091 31,144 30,959 33,257 33,000 - 36,000 Mississippi Non-CO2 Floods 5,930 5,642 5,636 4,746 5,486 4,576…
  28. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 28
    Tertiary Production by Field Average Daily Production (BOE/d) Field 1Q11 2Q11 3Q11 4Q11 1Q12E Phase 1 Brookhaven 3,664 3,213 3,030 3,121 3,014 Little Creek Area 1,637 1,636 1,533 1,444 1,216 Mallalieu Area 2,925 2,646 2,620 2,587…
  29. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 29
    Analysis of Tertiary Operating Costs Correlation 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 w/Oil /BOE /BOE /BOE /BOE /BOE /BOE /BOE /BOE CO2 Costs Direct 4.50 4.73 4.52 5.38 5.39 5.43 4.87 4.53 Power & Fuel Partially 6.12 5.82 6.03…
  30. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 30
    Reclassified 2011 Quarterly Income Statement Income Statement (In thousands) Q1 2011 Q2 2011 Q3 2011 Q4 2011 2011 Revenues and other income: Oil, natural gas, and related product sales 506,192 591,099 565,523 606,337 2,269,151 CO2…
  31. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 31
    Potential Carbon Gasification Projects Denbury purchase contracts (contingent on plants being completed) Initial production expected +/- 4 years after construction begins (not before 2015) Gulf Coast Sources (0.29 to 0.44/Mcf 60 Oil)…
  32. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 32
    Rockies Anthropogenic CO2 Rocky Mountain Purchase Contracts MMCFD COP Lost Cabin (Central Wyoming) (Q1 2013) Currently Under +/- 50 Construction XOM LaBarge (SW Wyoming) (1) (Q3 2012) +/- 50 DKRW Medicine Bow (SE Wyoming) (2) (+/-…
  33. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 33
    Most Recent Operated Bakken Well Activity 30-Day 60-Day 90-Day Avg.(2) Avg.(2) Avg.(2) Unit Frac IP Completed Well Area Formation IP (1) Acres Stages W. I. Date (BOE/d) (BOE/d) (BOE/d) Charlson 34-12 Charlson Bakken 1,441 524 538…
  34. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 34
    Most Recent Operated Bakken Well Activity 30-Day 60-Day 90-Day Avg.(2) Avg.(2) Avg.(2) Unit Frac IP Completed Well Area Formation IP (1) Acres Stages W. I. Date (BOE/d) (BOE/d) (BOE/d) Satter 24-35 SEH Cherry Bakken 2,015 892 851…
  35. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 35
    Most Recent Operated Bakken Well Activity Frac Unit Frac Completing Area Formation Date 30-Day Avg. Acreage Stages W. I. Olson 34-19 NWH Cherry Bakken Flowing N/A 1,280 24 79% Olson 34-19 SWH Cherry Bakken Flowing N/A 1,280 22 63%…
  36. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 36
    Bakken Area Production Zones Approx. Net Productive Zone Estimated Acreage Area MB TFS Wells/DSU (1,000s) Charlson 6 15 Murphy Creek 6 18 Bear Creek 6 10 Cherry 6 66 Lone Butte 6 9 Camp/Indian Hills 6 16 NE Foothills 3…
  37. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 37
    Encore Acquisition was Highly Profitable Purchase price: (Billions) Equity 2.8 Debt assumed 1.0 (1) Total value 3.8 Value: (Estimated values at 79.43/Bbl 12/31/10 SEC Pricing) Proved reserves at 12/31/10 2.0 (2) Proceeds…
  38. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 38
    Crude Oil & Natural Gas Hedge Detail 2012 Crude Oil Hedges (BOPD) (1) 2013 Crude Oil Hedges (BOPD) (1) Average (2) Ceiling Average (2) Ceiling Instrument Volume Price Floor Ceiling Low High Instrument Volume Price Floor Ceiling Low…
  39. IPAA 2012 Oil and Gas Investment Symposium – Denbury Resources Inc. – slide 39
    Capital Structure (MM) 12/31/11 Cash 19 Bank credit facility (Borrowing base of 1.6 billion, matures May 2016) 385 9.750% Sr. Sub Notes due 2016 (Callable March 2013 at 104.875% of par) 408 9.500% Sr. Sub Notes due 2016 (Callable…

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