Corporate Characteristics Historically, the Company has been successful in growing through the drill bit and strategic acquisitions 10-year(1) historical drilling success rate 91% Consummated reserve and leasehold acquisitions in…
Focused Effort to Fund Drilling with Cash Flow 350 Direct CapEx (excluding acq.) 300 Cash Flow (1) 250 MM (1) 2008 includes proceeds from sale of gathering system 200 (2) See reconcilation between cash flow from…
Ten(1) Years of Growth Reserves 30% CAGR Production 36% CAGR Cash Flow 103% CAGR Stockholders Equity 29% CAGR Stock price 24% CAGR (1) Begins in 1999 4
Resuming Operational Activity (Growth) Four Woodford wells completed during the 4Q09 Average IP rate of 6.4 MMcf/d Capital Expenditures budget expected to increase in 2010 Large operated position allows for control of timing of…
Our Properties PQ operated Non-operated Tulsa Arkoma Arkoma Basin Basin PQ Office Locations East East Texas Texas (1) As of December 31, 2008 68% Reserves (1) 68% Reserves (1) Lafayette 32% Reserves (1) 32% Reserves…
Our Portfolio UNCONVENTIONAL PLAYS Three separate Three separate basins all EAST TX ARKOMA basins all core poised for growth to PQ Gulf Coast South Offshore Louisiana GOM CONVENTIONAL PLAYS Unrisked Drilling Estimated 1P…
Arkoma Basin Approximately 46,000 net acres in the Woodford Shale Approximately 18,000 net acres in the Fayetteville Shale Current production in excess of 36,000 Mcf/day net 8
Woodford Shale Recent Activity Four Woodford wells completed in 4Q09; Continuous drilling activity expected during 2010 Estimated locations: 360+ on 80 acre spacing; 720+ on 40 acre spacing Continued improvement in IP rates and…
3D Seismic Based Drilling PQ 27 PQ 9 6000 ne Limesto ka anuc Wap 7000 e Shal dford Woo 8000 IP 12.5 MMcfe IP 2.9 MMcfe Section Section Section Line Line Line 9000 3D Seismic Profile 10
Gross Woodford Production (PQ Operated) Resumed Drilling 70,000 Operations Mcf/d Drilling Completed four Drilling Operations Operations 60,000 Suspended wells during Dec 09 Suspended 50,000 40,000 First Rig Second Rig…
Woodford Shale PQ Delivers Top Max Monthly Rate Horizontal Woodford Shale Completions PQ WOODFORD PROGRAM PQ delivered highest maximum monthly initial Max Monthly Gas Rate, Mcfd 4,500 production rate of any company 15%…
IRR Woodford Horizontal Well Economics /Mcf Capital (M) Assumptions: Price* 4,000 5,000 6,000 IP Rate 5.0 MMcfd 4 14.3% 7.3% 3.0% IRR % /Mcf EUR 4.6 Bcf 6 46.7% 31.4% 21.9% Well Cost - 4.0 to 6.0 MM 8 81.2% 58.4%…
Fayetteville Shale - Upside Leverage Ticker Fayetteville Acres Acres/EV (1) CHK HK SWN SWN 857,000 49.8 Stone PQ 18,000 32.7 XTO PQ HK 157,000 16.5 Van Buren Pope SWN CHK 415,000 15.0 HK Cleburne CHK XTO 380,000 10.3 (1)…
East Texas Haynesville/Bossier Upside CHK Haynesville Tests IPs 15 MMCFD EP (PQ 5% Override) Haynesville Test IP =10 MMCFD PQ Carthage 23,900 net acres LEGEND Bossier Tests IPs = 9 12 MMCFD Source: JPMorgan…
Near-Term Gulf Coast Drilling Inventory Focus near term capital on low cost recompletion opportunities, low risk development projects and select high impact drilling prospects 19
Consistent Approach Through Price Cycles Actively manage capital expenditures to align with cash flow Economic reserve and production growth Balanced portfolio of projects Focus on cost control 20
Capital Discipline Strengthens Balance Sheet Focused effort to keep capital expenditures below cash flow has generated substantial liquidity Note: In thousands of dollars 147% Increase (1) Repaid 30 million of bank debt in…
Growth in Production 40 35 30 3 6% 25 G R CA Guidance Bcfe 20 Arkoma 15 East Texas Gulf Coast 10 5 0 (1) 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 (1) Based upon the midpoint of production…
Cash Flow Growth in millions 250 225 200 175 03% 150 R 1 G 125 CA 100 75 50 25 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 CFFO(1) 0.9 4.4 22.8 40.9 29.2 34.2 70.3 73.2 119.4 223.7 169.1…
Capital Investment Program Diversification Reduces Risk 2002 2008 2009E GOM, 75% Gulf Coast Gulf Coast 12% Arkoma 21% Arkoma GOM 55% 52% Gulf Coast, 25% 18% GOM E. TX E. TX 15% 22% 5% 64 million 280 million 60 million…
Conservative Financial Philosophy Fund drilling expenditures with internal cash flow Target conservative leverage ratios Net debt / EBITDA < 2.0x (1x using 9/30/09 TTM) EBITDA / Interest 8.0x (8x using 9/30/09 TTM) No high yield…
Hedging Positions Target of hedging 40%-50% of annual production approximately 66% of the 2009 production is hedged (based on mid-point of production guidance) Estimated fair value of hedge positions at 11/30/09 was 13.4 MM Oil…
Summary and Outlook Consistently focused effort to drill within cash flow Actively manage Capex to stay aligned with cash flow Inventory and capability to continue production and reserve growth Operational and cost improvements in…
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