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EnerCom Oil & Gas Conference – Petroquest Energy Inc.

Petroquest Energy Inc. · Aug 13, 2013 · 40 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. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 1
    EnerComs Oil & Gas Conference August, 2013
  2. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 2
    Our Daily Focus Utilize Strong Gulf Coast Cash Flow to Develop High-Return Onshore Resource Assets 3
  3. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 3
    Gulf Coast Cash Flow Magnifies Growth Woodford Development Minimal Reinvestment Capex * Free Cash Flow Cotton Valley Expansion Gulf Coast Assets Mississippian Evaluation * Since 2007, Gulf Coast has generated 306 MM of…
  4. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 4
    Returns Focused Growth Long-lived asset base focused in industry leading basins Typical Returns by Play* 60% 55% 55% 52% 51% 49% 50% 42% 40% 40% 36% 35% 35% 34% 33% 30% 30% 28% 27% IRR 30% 26% 23% 21% 20% 20% 19%…
  5. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 5
    Our Properties Gulf Coast Gulf Coast Acquired Acquired Gulf Coast Gulf Coast Legacy Legacy RESERVES: 302.1 Bcfe (1) East Texas (75% Long Life) Mid-Con Legacy Gulf Coast Acquired Mid-Con PRODUCTION: 41.4 Bcfe (2)…
  6. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 6
    Gulf Coast Basin Acquisition Proven Track Fully Developed High Record in Exploiting Margin Cash Flow Gulf Coast Assets
  7. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 7
    GOM Assets Acquired La Cantera EC 65 D-1 EC 65 D-2 EC 160 A-7 SS 72/225 MP 72/74 EC 160 A-8 WC 401 VR 229 A-1 WD 89 D-1 WD 89 D-2 EC 222 WD 89 D-3 EI 246 J-1 WD 89 D-4 EI 246 J-2 SS 238 C-1 (6) WD 89 D-5 EI 246 J-3 SS…
  8. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 8
    Gulf Coast Acquisition Significant Cash Flow Accretion 23% production increase drives a 43% increase in cash flow Net Production Adjusted EBITDA per Share 3.00 200 2.50 150 2.00 132.5 2.00 MMcfe/d 114.2 /Share 30%…
  9. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 9
    Acquisition Overview Attractive Price for Cash Generating Assets 300 278 Proved 3P 250 192 Reserves 5.3 MMBoe 8.5 MMBoe 200 107 PV10(1) 171 MM 278 MM MM 150 171 F&D per BOE 36.41 22.66 100 Price/PV10 1.1x 0.7x 50…
  10. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 10
    History of Positive Reserve Revisions Main Pass 74 Example 1P Reserves 3P Reserves SEC Booked Reserves Lease Line Water Level at Discovery Original Booked Reserves (1P) 2003: 7.6 Bcfe (net) Positive Reserve Revisions…
  11. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 11
    Onshore Growth Assets Accelerate Development of Long-lived, Low-risk Woodford Shale and Cotton Valley Assets 12
  12. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 12
    Woodford Position Ramping Up Development 2013 Liquids Rich Leasing Activity 18,000 acres Legacy Liquids Rich Acreage Legacy Dry Gas Acreage 3,000 acres 60,000 acres Asset Highlights and Current Liquids Rich Focus: Average…
  13. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 13
    Woodford Liquids Rich Gas Horizontal Well Economics (With JV Promote) 120% Capital 110% 4MM 100% 90% Wet Marcellus(1) 80% 80% Dry Marcellus(1) 70% 60% IRR 50% 40% 30% 20% 10% 0% 3.00 3.25 3.50 3.75 4.00 /Mcf…
  14. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 14
    Continuous Improvement in the Woodford PetroQuest Operated Woodford Horizontal Wells 4500 PQ 1-24 4000 PQ 25-48 3500 PQ 49+ 3000 Gas Rate, MCFED 2500 2000 34% Improvement in Average Production 1500 1000 500…
  15. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 15
    PQ Woodford Performance Expect to Replicate 8 years of drilling over the next 2.5 years 60 120 Wells Cumulative Production 50 50 50 PDP Reserves 100 40 80 34 Wells 30 Bcfe 30 60 20 16 40 19 10 9 20 9 4 1 5 -…
  16. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 16
    Liquids Rich Cotton Valley Program 6 non-operated wells completed in 2011 Average IP rate of 3.9 Mmcf/d and 244 barrels of NGLs/d 9 operated wells completed in 2011 2013 Average IP rate of 5.5 Mmcf/d and 371 barrels of NGLs/d…
  17. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 17
    Liquids Rich Cotton Valley Program True Resource Play Improving Well Performance With Each New Well 12 6.3 Mmcf + 458 Bbls 10 of NGLs Average IP Rate (Mmcfe/d) 5.2 Mmcf + 359 Bbls 8 of NGLs 4.4 Mmcf + 312 Bbls of NGLs…
  18. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 18
    Liquids Rich Cotton Valley Horizontal Well Economics 55% 52% 50% 45% IRR 40% 40% 35% 30% 28% 25% 3.00 3.50 4.00 Gas* NGL IRR Payback 3.00 25 28.1 % 26 Months 3.50 30 39.7 % 20 Months Assumptions: 4.00 35 51.6 %…
  19. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 19
    Mississippian Lime Utilizing Science to Enhance Value PQ Phase I: Exploration 14 wells High Visibility / High Variability (market) Grant PQ Kay Phase II: 3-D Acquisition/Reservoir Modeling (2013) Phase III: Development 2014+ RRC SD…
  20. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 20
    Cash Flowing Gulf Coast Assets Attractive Development Prospects with Minimal Funding Requirements 21
  21. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 21
    Gulf Coast Assets: Free Cash Flow Funds Growth Capex as a % of Net Cash Flow(1) Cum Net CF 80% 350 70% 280.6 305.6 300 62% Capex as a % of Cash Flow 60% 54% 249.8 54% 250 50% 45% 220.2 45% MM 200 40% 171.8 150…
  22. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 22
    La Cantera High Impact Discovery 23
  23. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 23
    La Cantera Development Lower Cris R-1 200 feet of potential pay 30,000 MCF/D + 500 Bbls of oil Lower Cris R-2, Lobe A 2-3 Year Reserve Life (CURRENTLY PRODUCING) 30,000E MCF/D + 500 Bbls of oil 40,000E MCF/D + 800 Bbls of…
  24. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 24
    PQ Operated Gulf Coast Drilling Summary Recent Projects First Prospect NRI Production Feet of Pay I.P. Rate Thibodeaux 1(La Cantera Prospect) 17% March 12 248 Net TVD 36,000 Mcfe Broussard Estates 2 (La Cantera Prospect) 17% Sept 12 310…
  25. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 25
    Funding The Future Enhanced Liquids Profile Meaningfully Improves Returns and Margins 26
  26. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 26
    Product Diversification Gas to Liquids Liquids Production Will Drive Cash Margin Expansion 8,000 7,000 6,625 6,000 Barrels Per Day 5,000 4,479 4,000 3,550 2,953 2,871 3,000 2,639 2,673 2,474 2,517 2,150 2,000…
  27. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 27
    Debt Metrics Debt/EBITDA Comparison Debt Ratios 6.0x Pro forma(1) Target 4.9x Debt to EBITDA 3.0X 2.0X 5.0x 4.5x Interest Coverage 3.8X 5X 4.0x 3.6x Debt to Proved Mcfe 1.37 < 1.00 3.4x3.4x Debt to EBITDA 3.0x3.0x 3.0x…
  28. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 28
    Committed to Fund Drilling with Cash Flow PQ has balanced Capex and cash flow over the past 8 years Direct CapEx (excluding acq.) Cash Flow Other Proceeds (1) 1,400 1,200 189 1,000 MM 800 600 1,074 1,079 400 200…
  29. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 29
    The Opportunity Positioned for considerable growth of reserves, production and cash flow while maintaining capital discipline Value: Currently trading at 2.1x analyst 2014E cash flow estimate (1) Balanced, diversified asset…
  30. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 30
    Appendix 31
  31. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 31
    Capital Investment Program (Liquids Focused) 160 160 2013E 140 140 135 140 Miss Lime 120 8% 105 Texas 100 132.5 8% 120 MMCFE/D MM GOM.GC 80 38% Other 60 100 107.5 19% 40 87.4(2) 80 Woodford 20 27% 0 60 2012…
  32. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 32
    Appendix 1 Hedging Positions Target of hedging 40%-50% of annual production Daily Hedged Volumes Average Natural Gas (Mmbtu) Price Feb13 Dec13 10,000 3.71 Mar13 Dec13 5,000 3.50 Apr13 Dec13 10,000 3.90 July13 Dec13 5,000 4.00 -…
  33. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 33
    Appendix 2 ( in thousands) 2008 2009 2010 2011 2012 1H13 Net Income (Loss) (102,100) (95,330) 41,987 5,409 (137,218) 6,269 Income tax expense (benefit) (55,581) (14,635) 1,630 (1,810) 1,636 (491) Interest expense & dividends…
  34. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 34
    Appendix 3 ( in thousands) 2004 2005 2006 2007 2008 2009 2010 2011 2012 1H13 Net income (loss) 16,348 21,417 23,986 40,619 (96,960) (90,190) 47,126 10,548 (132,079) 8,836 Reconciling items: Deferred tax expense (benefit) 8,511…
  35. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 35
    Appendix 4 Woodford JV Transaction Summary Woodford JV closed May 2010 whereby partner received 29 Bcfe of PUD reserves and right to earn 50% of Woodford acreage Received cash payments totaling 88.0 million Through 6/30/13 have…
  36. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 36
    Appendix 5 PQ Woodford Performance Horizontal Woodford Shale Completions Max Monthly Gas Rate, Mcfd 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 - PQ A B C D E F G H I Source: compiled from public domain…
  37. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 37
    Appendix - 6 Panola County Cotton Valley Room to Run Legend Cotton Valley Wells PQ CV Vertical Wells PQ CV Horizontal Wells PQ Area Carthage Field of Mutual Area 4.4 TCF Interest 518 Bcfe CV/Bossier Potential 38
  38. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 38
    Appendix 7 Horizontal Cotton Valley 39
  39. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 39
    Appendix - 8 Positioned for Growth Total Production 60 50 Bcfe 40 48 30 39 34 30 20 2011 2012 2013E (1) 2014E (1) 82% (1) Based on mid-point of updated 2013/2014 production guidance range 40
  40. EnerCom Oil & Gas Conference – Petroquest Energy Inc. – slide 40
    400 East Kaliste Saloom Road, Suite 6000 Lafayette, Louisiana 70508 Phone: (337) 232-7028 Fax: (337) 232-0044 www.petroquest.com NYSE: PQ 41

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