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Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc.

Warren Resources Inc. · Mar 20, 2012 · 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. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 1
    Sidoti & Companys Sixteenth Annual New York Institutional Investor Forum March 20, 2012
  2. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 2
    March 2012 Corporate Presentation Reasons to Invest Oil-weighted producer: 80% by revenue 32% CAGR 5-year oil production growth rate High Potential Oil Assets in 3 U.S. Field 15 MMbo proved; 30-40 MMbo reserve potential 200+…
  3. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 3
    March 2012 Corporate Presentation Business Strategy Drill-Bit Production & Reserves Growth 8+ year oil drilling inventory Develop 30-40 mmbo reserve potential in California 20+ year gas drilling inventory in Wyoming Fund 2012+…
  4. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 4
    March 2012 Corporate Presentation Project Development Process Raw Data Quality Control Process Modeling 1500 Wells Modernization Geological Modeling Petrophysical Evaluation Geostatistical Evaluation Interpretation Internal Peer…
  5. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 5
    March 2012 Corporate Presentation 2011-2012 Review 2012 Capital Budget: 70 million California Midway Sunset Oil Trades at 5 to 15 premium to WTI 4% WY 2011 production (3MM) 1,748,000 boe total Average of 4,789 boe 96% CA…
  6. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 6
    February 2012 Corporate Presentation WTI-CMS Historical Prices WTI-CMS Historical Prices 120 CMS* WTI 115 California oil Price per Bbl (Rolling 30 Day Average) 110 105 100 95 90 WTI oil 85 80 75 70 *CMS…
  7. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 7
    March 2012 Corporate Presentation Areas of Operations Warren Resources, Inc. CASPER NEW Proved Reserves as of 12/31/11: YORK 22.3 MMBoe LONG BEACH Current Average Net Production: 5,000 Boe/d Reserves Offices Areas of…
  8. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 8
    March 2012 Corporate Presentation Operations Performance: 2006-2011 Historical Production (MBOE) Historical Lease Operating Expenses (/BOE) 25.00 22.20 20.64 20.70 20.00 16.92 16.54 17.53 15.00 10.00 5.00 CAGR =…
  9. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 9
    March 2012 Corporate Presentation Asset Overview California Assets are Operated Wyoming Assets are JV-operated by Anadarko As of December 31, 2011 Area Total Net Proved Net Producing Total Drilling Reserves (MMboe) Wells…
  10. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 10
    March 2012 Corporate Presentation California: Wilmington Townlot Unit NASDAQ: WRES 10
  11. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 11
    March 2012 Corporate Presentation California Oil: Environmentally Friendly WTU CENTRALIZED DRILLING AND PRODUCTION CELLARS NASDAQ: WRES 11
  12. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 12
    March 2012 Corporate Presentation 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…
  13. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 13
    March 2012 Corporate Presentation California Oil: Wilmington Field Producing Zones SW Tar NE Ranger Terminal - 3000' Union Pacific Ford - 6000' Schist Productive Limits Basement - 9000' One Mile NASDAQ: WRES 13
  14. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 14
    March 2012 Corporate Presentation California: Oil Operating Strategy Oil Production Growth 30-50% CAGR growth delivered historically Target Rates of Return per well of 50-80% 80 WTI oil price deck use for planning Use modern…
  15. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 15
    March 2012 Corporate Presentation California: Oil Operations Summary Wilmington Townlot Unit (WTU) North Wilmington Unit (NWU) 99% WI, 81% NRI 100% WI, 85% NRI Unitized for water flood in 1972 Unitized for water flood in 1977 by…
  16. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 16
    March 2012 Corporate Presentation California: Recent Oil Production Warren California Oil Oil Production Warren California Oil Production 4,000 Oil 3,500 3,000 2,500 Oil bpd 2,000 1,500 1,000 500 0…
  17. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 17
    March 2012 Corporate Presentation California: Development Strategy Continue horizontal / sinusoidal redevelopment plans Follows 3 vertical developments since the 1930s Drill Highly Targeted Horizontal Wells in 14 layers of…
  18. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 18
    March 2012 Corporate Presentation California Oil Development WTU Redevelopments since 1937 Tar Historical BOPD Description 37 horizontal wells drilled, 27 pending Warren succeeded in redeveloping the Tar interval with targeted…
  19. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 19
    March 2012 Corporate Presentation California Oil: Reservoir Modeling and Drilling Technology Well Placement Utilizing State-of-the-Art LWD Technology NASDAQ: WRES 19
  20. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 20
    March 2012 Corporate Presentation California Oil: Tar Reservoir Tar Reservoir Horizontal Development Cross-section showing saturations in NW area of Tar NASDAQ: WRES 20
  21. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 21
    March 2012 Corporate Presentation 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…
  22. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 22
    March 2012 Corporate Presentation California Oil: NWU Ranger Reservoir NASDAQ: WRES 22
  23. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 23
    March 2012 Corporate Presentation Targeted Sinusoidal Drilling Actual NWU Ranger well path shown Shale Sand Well path 180 amplitude Sinusoidal well shown above NASDAQ: WRES 23
  24. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 24
    March 2012 Corporate Presentation Wyoming Oil & Gas: Assets NASDAQ: WRES 24
  25. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 25
    March 2012 Corporate Presentation 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…
  26. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 26
    March 2012 Corporate Presentation 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 26
  27. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 27
    March 2012 Corporate Presentation Wyoming: Recent Gas Production Warren Production NASDAQ: WRES 27
  28. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 28
    March 2012 Corporate Presentation Wyoming CBM Strategy Gas: Optimize cash flow from Anadarko- Warren Joint Venture CBM asset at low current gas prices Optimize frac work to grow production Continue to reduce unit operating…
  29. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 29
    March 2012 Corporate Presentation Wyoming Niobrara Strategy Define Niobrara oil strategy Analyze Atlantic Rim Area regional Niobrara exploration study Rank prospective Niobrara focus areas within 77,000 net acre position…
  30. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 30
    March 2012 Corporate Presentation 2012 Milestones: What to Watch 6 California DOGGR injection well permits received in January & February 2012 Improved reservoir pressure maintenance will shallow production decline Successful…
  31. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 31
    March 2012 Corporate Presentation: Financial Highlights NASDAQ: WRES 31
  32. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 32
    March 2012 Corporate Presentation 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…
  33. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 33
    March 2012 Corporate Presentation Peer Valuations Enterprise Value per Proved Developed BOE Debt/Cap Ratio 33% 102% 19% 103% 64% 9% 58% 88% 23% 12% NASDAQ: WRES 33
  34. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 34
    March 2012 Corporate Presentation Peer Analysis: 2-Year F&D 100% /BOE 19.74 75% 9.30 50% 25% Warren Resources Peer Group Average Source: EnerCom, Inc. Five Factor Model * Costs incurred divided by the sum of…
  35. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 35
    March 2012 Corporate Presentation 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…
  36. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 36
    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…
  37. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 37
    March 2012 Corporate Presentation Peer Analysis: Debt / Total Cap 100% Concentrated effort to reduce debt 90% 100% 80% 70% 60% 50% 75% 41% 40% 34% 50% 30% 20% 25% 10% 0% Warren Resources Peer Group Average…
  38. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 38
    March 2012 Corporate Presentation Debt / Total Cap 60% 50% 50% 42% 40% 33% 34% 30% 20% 10% 0% 12/31/2008 12/31/2009 12/31/2010 12/31/2011 Source: Bloomberg NASDAQ: WRES 38
  39. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 39
    March 2012 Corporate Presentation Debt-Adjusted Production Growth Per Share 150% 98% 100% 53% 50% 42% 40% 0% -1% -9% -10% -19% -50% -52% -54% -75% -100% -150% -200% -250% -244% -300% A B WRES C D E F G H I J…
  40. Sidoti Company 16th Annual Institutional Investor Forum – Warren Resources Inc. – slide 40
    March 2012 Corporate Presentation: Closing Remarks Strong Assets & Significant Accomplishments World Class Assets 30-40 mmbo oil potential California 500-600 bcf gas potential in Wyoming Strong Growth Track Record 32% CAGR…

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