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APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc.

Bonanza Creek Energy, Inc. · Apr 16, 2013 · 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. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 1
    Investor Presentation Expanding the Runway April 2013
  2. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 2
    Bonanza Creek Overview Wattenberg Field (1) Market Cap : 1.5 billion North Park Basin (Niobrara & Codell) Enterprise Value(1): 1.7 billion (Niobrara) 31.9 MMBoe 1P(3) Public Float(2): 73% (3) 0.5 MMBoe 1P 59% Oil 100% Oil…
  3. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 3
    Impressive Growth Track Record Proved Reserves(1) (MBoe) Production(1) (Boe/d) +62%(2) 60,000 16,000 +21% 14,000 50,000 12,000 40,000 10,000 30,000 8,000 6,000 20,000 4,000 10,000 2,000 0 - 2007 2008 2009 2010 2011…
  4. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 4
    Dramatic Year-Over-Year Increases 4Q12 as compared to 4Q11 107% Increase in Production (1) 11,994 Boe/d 136% Increase in Adj. Net Income (2) 15.7 million (0.39/sh) 138% Increase in EBITDAX (2) 54.1 million (1.35/sh)…
  5. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 5
    Oil Weighted Assets Drive Strong Margins 4Q 2012 Revenue Unhedged Cash Margin / Boe(1) (3) (2) 74.0 Million 66.84 11% Nat. Gas 73% Cash Margin (48.66) 89% Oil & Liquids 10% Cash G&A 6% Prod. Taxes 11% LOE (1)…
  6. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 6
    Oil Weighted Reserves & Production Reserve Mix By Commodity (MMBoe)(1) Reserve Mix By Category (MMBoe)(1) Wet Gas GPM: 4.0 6.5 23.8 12% Crude Oil 45% Mid-Con Dry Gas PD 13.2 25% 30.2 PUD 57% Rockies Wet Gas Mid-Con NGLs 29.2…
  7. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 7
    Strong Organic Growth Inventory 350 MMBoe of resource potential(1) 9 primary opportunities in various stages of development and evaluation Wattenberg Wattenberg Niobrara B Arkansas Cotton Valley Wattenberg Niobrara C Arkansas…
  8. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 8
    2013 Capex Plan(1) Wattenberg Activity Doubles Wattenberg Field: 324 million 2013 Capex: 394 million Niobrara B (4,000): 56 wells Niobrara B (9,000): 2 wells Niobrara B (40-acre test): 6 wells Niobrara C: 4 wells Codell: 4 wells…
  9. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 9
    Wattenberg Niobrara a Premier Oil Resource Play Basin IRRs Futures Strip as of 1/31/2013 60% 56% 54% 53% 51% 50% 44% 43% 40% 37% 36% 36% 35% 34% 31% 31% 30% 28% 26% 23% 22% 22% 21% 19% 18% 18% 20% 17% 16% 16% 13% 12%…
  10. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 10
    Wattenberg Horizontal Niobrara Oil Focused Wells Ranch 40-acre downspacing pilots A bench / C bench / Codell pilots Extended reach laterals NBL cites OOIP / section of 74 MMBoe at Wells Ranch Niobrara B: 36 wells Avg.…
  11. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 11
    Niobrara B Bench Production Profiles BCEI Niobrara B Bench wells at time zero 12
  12. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 12
    Performance Improvement 510 BCEI Reported Average IP30 Rates 40 Technical Improvements 500 35 Increased frac stages from 16 to 18 490 30 Increases reservoir wellbore communication 480 25 Wellcount Controlled flowback…
  13. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 13
    Wattenberg Expanding Resource Recovery Niobrara C Bench Horizontal C Bench present on all Wattenberg acreage BCEI completed its first C Bench well in December 2012 IP30 rate: 444 Boe/d (79% crude oil) Codell Horizontal…
  14. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 14
    2012 Catalyst Well Performance Tested Codell, C Bench and Extended Reach Lateral Wells with Positive Results(1) 10,000 1,000 Boe/d 100 10 0 20 40 60 80 100 120 140 160 180 200 220 240 Days (2) 313 MBOE B Target Curve…
  15. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 15
    Drilling Improvements Time (Days) 2011 2012 2013 Spud to Spud 15.4 15.2 13.5 Spud to Rig Release 13.9 12.4 6,000,000 16 Stages 18 Stages 2013 Guidance 5,000,000 4.2 MM 4,000,000 3,000,000 2,000,000 1,000,000 0 1 2 3 4…
  16. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 16
    Wattenberg Hz Niobrara B Target Type Well EUR 313,000 Boe; 62% crude oil(1) Initial 30-day Rate 458 Boe/d Cost per Well 4.2 MM NPV-10 at 80/BO 4.2 MM Payout (Years) 1.5 ROR Sensitivity to Oil Price(2) (1) EUR based on…
  17. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 17
    Wattenberg 3P Reserves & Location Inventory 247 MMBoe Net 3P Reserves Proved Reserves 32 60% crude oil / 40% wet gas MMBoe 32 MMBoe booked at YE2012 13 MMBoe PD 19 MMBoe PUD 107 MMBoe 108 MMBoe 215 MMBoe unbooked at…
  18. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 18
    Mid-Continent Operations (Arkansas) Provides free cash flow; reallocated to Wattenberg Niobrara ERA SYSTEM SERIES GROUP FORMATION CENOZOIC EOCENE Claiborne PALEOCENE Wilcox Cotton Valley: 6,500 8,800 feet TERTIARY CRETACEOUS…
  19. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 19
    Dorcheat-Macedonia Economics Type Well Economics 10-acre 5-acre EUR 148,000 Boe(1) 118,000 Boe % Oil & Liquids 65% 65% Cost per Well 1.8MM 1.8MM NPV-10 1.8MM 1.3MM Payout (Years) 1.6 1.8 Risked Locations 120 gross(2) 219 gross…
  20. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 20
    Cotton Valley Lenticular Oil Sands Pin-Point Fracture Technology Focused completion technology Improved recovery of OOIP Highly repeatable Dorcheat Unit 37 25-30 sand/shale sequences Each zone individually pressured Potential…
  21. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 21
    Financial Overview 22
  22. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 22
    Improving Operating Cost Structure High Margins Unit Cash Operating Costs (/Boe) Unit Revenue & Cash Margins (/Boe) 30 80 70 25 5.71 60 76.68 3.49 66.93 20 3.43 50 65.70 67.43 8.19 3.90 15 40 9.12 7.76 6.75 30 10 50.74…
  23. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 23
    Current Hedge Positions 6,000 Bbl/d hedged at a minimum price of 88.45/Bbl in 2013 4,200 Bbl/d hedged at a minimum prices of 87.34/Bbl in 2014 Less than 2% gas production hedged in 2013 Oil Swaps Oil Collars Gas Swaps (Bbls/d) (/Bbl)…
  24. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 24
    Balance Sheet Structure 25 Recent high yield offering(1) Inaugural issue for BCEI 8 year term Yield of 6.75% sets new record for single B, first-time E&P issuers Upsized from 250 million to 300 million Borrowing base Reduced to…
  25. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 25
    Financial Summary Simplicity & Transparency = Successful Outcomes 26 Balanced approach to capital allocation Fund oily growth with oily cash flow and prudent balance sheet use Maintain block & tackle growth in the Mid-Continent with…
  26. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 26
    Expanding the Runway Total Resource Potential of 350 MMBoe Total assessed 3P reserves of 283 MMBoe in Wattenberg & Mid-Continent Other resource estimated at 60-90 MMBoe Oil weighted Maintain peer leading production growth rates Top…
  27. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 27
    Corporate Information Company Headquarters Investor Relations 410 17th Street, Suite 1400 James Masters Investor Relations Manager Denver, Colorado 80202 (720) 440-6121 (720) 440-6100 Main jmastersbonanzacrk.com (720) 305-0804…
  28. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 28
    Appendix 29
  29. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 29
    Experienced Management Team Founder of predecessor companies Mike Starzer Prior: Executive and Engineering roles at Unocal and Berry Petroleum President & CEO B.S. in Petroleum Engineering, Colorado School of Mines; M.S. in…
  30. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 30
    Experienced Management Team Joined in 2011 bringing expertise in corporate law, administration, M&A, federal Chris Humber securities laws and stock exchange rules SVP & General Counsel Prior: Kendall, Koenig and Oelsner; Hogan &…
  31. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 31
    Wattenberg Horizontal Niobrara Economics(1) Target 313 MBoe Type Curve 600 30-day Avg: 458 boepd 550 60-day Avg: 400 boepd 90-day Avg: 355 boepd 500 450 400 350 Boe/d 300 250 200 150 100 50 0 0 12 24 36 48 60…
  32. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 32
    DJ Basin Midstream Infrastructure Capacity Crude Pipelines and Rail Projects Operator Origination Termination Hub Timing (Bbl/d) White Cliffs Pipeline SemGroup 70,000 Platteville, CO Cushing, OK Existing White Cliffs Expansion SemGroup…
  33. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 33
    Easing High Line Pressures in Wattenberg BCEI Considerations High line pressures caused by constrained gas processing capacity Legacy vertical wells impacted more than newer horizontal wells 60% of BCEI production comes from…
  34. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 34
    North Park Basin Niobrara(1) EUR 211,000 Boe Initial 30-day Rate 304 Boe/d % Oil 90% Cost per Well 5.1 MM NPV-10 at 80/BO 2.1 MM NPV-10 at 100/BO 3.9 MM 2014-2015 development opportunity EVALUATING No natural gas takeaway…
  35. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 35
    Dorcheat-Macedonia Type Curve(1) 140 Recompletions opening additional 120 Cotton Valley oil pay zones up hole Boe/d 100 80 60 40 20 0 0 12 24 36 48 60 Months (1) The type curve shows the relevant curve…
  36. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 36
    Mid-Continent Gas Processing Facilities General Overview Approximately 150 miles of gathering lines Nevada Processes minor quantities of third party natural gas Facilities interconnect into the CenterPoint Energy pipeline system…
  37. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 37
    Reconciliation to Adjusted Net Income Adjusted net income and adjusted net income per diluted share exclude (1) unrealized gain or loss in fair value of commodity derivatives, (2) stock-based compensation expense, (3) impairment of proved…
  38. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 38
    Reconciliation to EBITDAX We define EBITDAX as net income, plus (1) exploration expense, (2) depletion, depreciation and amortization expense, (3) stock-based compensation expense, (4) interest expense, (5) unrealized loss (gain) on…
  39. APRIL 2013 INVESTOR PRESENTATION – Bonanza Creek Energy, Inc. – slide 39
    Reconciliation to Discontinued Operations Three Months Ended Twelve Months Ended 4Q 2012 Sales Volumes December 31, December 31, 2012 2011 2012 2011 Continuing Operations 11,950 Boe/d NET REVENUES Oil and gas sales 73,592 35,115…

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