IPAA Oil & Gas Investment Symposium April 18, 2012 New York City
Areas of Operations Warren Resources, Inc. Proved Net Reserves as of 12/31/11: CASPER NEW 22.3 mmboe (15 oil, 7.3 natural gas) YORK 46% oil reserve growth in 2011 LONG BEACH Current Average Net Production: 5,000 boepd (3000 bopd…
California: Wilmington Oil Field Overview Los Angeles Warren Property Highlights Within the 3rd largest U.S. oilfield Shallow waterfloods in the Tar, Ranger and Upper Terminal formations 9- 17 gravity oil Deeper Ford…
Wyoming: Atlantic Rim CBM Gas Warren Property Highlights Spyglass Hill Mega Unit: 113,000 gross acres held by production 25-well per year Unit drilling commitment for 10 years Spyglass Hill 1 Bcf estimated EUR per 80 acre Mega…
Atlantic Rim Producing Zones Atlantic Rim Spyglass Hill Mega Unit W Mesaverde Outcrop E - 2,000' - 6,000' - 10,000' CBM Down Dip Productive Limits Ten Miles NASDAQ: WRES 5
Reasons to Invest Oil-weighted producer: 80% by revenue 22% CAGR 6-year oil production growth Top quartile Total Shareholder Return vs Peers over past 3 years 60% rate of return targeted for 2012 new wells Attractive Oil Assets in…
Business Strategy Production & Reserves Growth 6-8 year oil drilling inventory in CA with 25-30 mmbo net reserve additions potential 46% oil reserve growth in 2011 20+ year gas drilling inventory in Wyoming Fund 2012 capex of…
Wyoming: Recent Gas Production Warren Production 16,000 14,000 12,000 10,000 MCFD 8,000 6,000 4,000 2,000 0 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 NASDAQ: WRES 10
California Oil Development WTU Redevelopments since 1937 Tar Historical BOPD Description 45 horizontal wells drilled, 30-40 pending Warren succeeded in redeveloping 2000 bopd the Tar interval with targeted Oil Cut horizontal…
Project Development Process Raw Data: Quality Control Process Modeling 1500 Wells Modernization Geological Modeling Petrophysical Evaluation Geostatistical Evaluation Seismic Interpretation Internal Peer Review (available late…
California: Wilmington Townlot Unit NASDAQ: WRES 13
California Oil: Environmentally Friendly WTU CENTRALIZED DRILLING AND PRODUCTION CELLARS * Warrens drilling cellars received the IOGCC 2011 Environmental Stewardship Award for independent oil companies. NASDAQ: WRES 14
California Oil: Environmentally Friendly Integration into the community. NASDAQ: WRES 15
California Oil: Environmentally Friendly Warren Rig 1 is sound proofed completely enclosed. NASDAQ: WRES 16
California Oil: Wilmington Field Producing Zones SW Tar NE Ranger Terminal - 3000' Union Pacific Ford/237 - 6000' Schist Productive Basement - 9000' Limits One Mile NASDAQ: WRES 17
California Oil: Reservoir Modeling and Drilling Technology Well Placement Utilizing State-of-the-Art LWD Technology NASDAQ: WRES 18
California Oil: Tar Reservoir Tar Reservoir Horizontal Development Cross-section showing saturations in NW area of Tar NASDAQ: WRES 19
Targeted Sinusoidal Drilling Actual NWU Ranger well path shown Shale Sand Well path 180 amplitude Sinusoidal well shown above NASDAQ: WRES 20
California Oil: Tar Type Well Illustrative Economics (1) IRR 80 NYMEX = 100+% NYMEX Oil Price 80 NYMEX Price Required for 45 10% ROR Sales adjustment 10% Realized Price (Boe) 72 LOE, Gathering & Transportation (17.50 )…
2012 Milestones: What to Watch 6 California DOGGR injection well permits received in 1Q12 Improved reservoir pressure maintenance will shallow production decline 20 California oil wells to be drilled in 2012, plus 9 water injections…
Strong Assets & Significant Accomplishments World Class Assets 25-30 mmbo oil reserves potential California 250-300 bcf gas potential in Wyoming Strong Growth Track Record 22% CAGR 6-year oil growth rate 60-100% rate of return…
April 2012 Corporate Presentation Financial Highlights
Historical Financial Performance Year Ended Year Ended Year Ended Year Ended 2011 2010 2009 2008 Total production (MBOE) 1,748 1,744 1,600 1,499 Adjusted EBITDAX 50,511 52,061 25,581 66,363 Balance Sheet Information Cash…
Peer Valuations Enterprise Value per Proved Developed BOE 600.00 / Proved Developed BOE 518.69 500.00 400.00 300.00 200.00 171.61 109.15 100.00 91.72 39.31 42.18 47.74 48.67 22.38 24.54 31.74 0.00 WRES33%…
Peer Analysis: 2-Year F&D 100% /BOE 19.74 75% 50% 9.30 25% Warren Resources Peer Group Average Source: EnerCom, Inc. Five Factor Model * Costs incurred divided by the sum of extension, discoveries, revisions and…
Peer Analysis: TTM OPEX/G&A 70.00 60.00 100% 50.00 40.00 /BOE 30.00 26.86 75% 26.15 50% 20.00 25% 10.00 0.00 Warren Resources Peer Group Average Source: EnerCom, Inc. Five Factor Model * (OPEX + G&A) divided…
Peer Analysis: TTM Capital Efficiency 400% 350% 100% 300% 75% 275% 250% 50% 200% 202% 150% 100% 25% 50% 0% Warren Resources Peer Group Average Source: EnerCom, Inc. Five Factor Model * (TTM EBITDA divided by TTM…
Peer Analysis: Debt / Total Cap 100% Concentrated effort to reduce debt 90% 100% 80% 70% 60% 50% 75% 40% 41% 50% 30% 34% 20% 25% 10% 0% Warren Resources Peer Group Average Source: Bloomberg NASDAQ: WRES 30
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