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JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd.

Gastar Exploration, Ltd. · Sep 10, 2014 · 42 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. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 1
    Johnson Rice Energy Conference September 2014 E XPANDING 2014 Gastar Exploration Inc. O UR H ORIZONS 1
  2. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 2
    Company Profile Asset Overview (06/30/2014) YTD 06/30 Net Prod. by Region Utica Dry Gas(1) Marcellus Shale Play Mid- Appalachia Continent 9,600 net acres leased 58,900 net acres 5.9 MBoe/d 3.7 MBoe/d 2,100 net acres pending 61%…
  3. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 3
    Key Investment Criteria Strong drilling results in the Hunton Limestone oil play High-Quality Resource Core development position in the liquids-rich Marcellus Shale Base Significant Utica potential under Marcellus Shale…
  4. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 4
    Proven Track Record of Growth Significant reserves and production growth through acquisitions and the drill bit Proved Reserves by Product 80.0 64.0 46% 48.0 MMBoe 45% 32.0 28% 54% 16.0 23% 55% 0.7% 72% 77% 99.3%…
  5. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 5
    Summary Target Economics 685 net locations for Hunton, Marcellus and Utica, additional 512 net locations in Stack Play Operated and Non- Operated Lower Operated WEHLU Operated WEHLU Hunton Upper Hunton Lower Hunton Marcellus Utica…
  6. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 6
    Capital Budget Focused on Liquids 93% of 2014 and 92% of 2015 D&C and infrastructure budget targets liquids-rich plays 2014 Capital Investment Area Capital (MM) % of Total Infrastructure Mid-Continent 107 48% 6MM Appalachia 71 31%…
  7. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 7
    HUNTON & STACK PLAYS 2014 Gastar Exploration Inc. 9
  8. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 8
    Hunton: First Mover Advantage Large, contiguous acreage position with multiple horizontal targets Asset Overview Hunton Asset Map 126,000 net acres CHK acquisition and subsequent non-core lease sale significantly lowered GST…
  9. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 9
    Oklahoma Hunton Play 3P Resource of 109MMBoe, primarily oil(1) Overview Hunton Activity Map Successful drilling results, leading to development Beckenridge 1-2H Anna Lee 1-30H OKLAHOMA Jam 1-4H Barry 1-6H Falcon 1-5H…
  10. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 10
    Non-Operated AMI Activity Encouraging results leading to development Overview Non-Operated Activity Map Anna Lee 1-30H AMI established in 2012 to focus on Beckenridge 1-2H Lower Hunton development Jam 1-4H Barry 1-6H AMI Operator…
  11. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 11
    Non-Operated AMI Average Well Performance Production and % oil averages better than current type curve 800 640 75% (Boe and % Oil) 480 63% 320 77% 80% 82% 68% 70% 63% 63% 63% 63% 160 63% 63% 67% 0…
  12. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 12
    Operated Hunton Development Development Plan Operated Activity Map Focus is on de-risked high-return WEHLU with one full time rig split between Upper and Lower Hunton OKLAHOMA Lower Hunton Development Burton 16-1H 5 horizontal…
  13. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 13
    Operated Hunton Potential Hunton offers a substantial source of high return projects Upper Hunton Overview Lower Hunton Overview 61 PUDs on northern WEHLU acreage Previous operator drilled no horizontal producing wells on WEHLU…
  14. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 14
    Woodford Activity Overview Woodford Activity Map(1) Offset operator IPs up to 1,000 Gastar Prospective Woodford Acreage Boe/d Devon Energy 191 Boe/d (54% Oil) Devon Energy 169 Boe/d (60% Oil) 2 Dorado wells Gastar acreage…
  15. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 15
    Meramec/Mississippi Lime Activity Overview Meramec / Miss Lime Activity Map(1) Offset operator IPs range up to 1,800+ Boe/d Longfellow 524 Boe/d (81% Oil) Longfellow 1,884 Boe/d Devon Energy 331 Boe/d (69% Oil) (80% Oil)…
  16. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 16
    Oklahoma Summary 2014 Capital Budget Activity 40.0 (20.1 net) gross wells anticipated to be spud 33.0 gross (13.2 net) non-operated AMI Hunton wells 7.0 gross (6.9 net) operated Hunton wells 2015 Capital Budget Activity 46.0 (28.6…
  17. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 17
    MARCELLUS AND UTICA 2014 Gastar Exploration Inc. 19
  18. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 18
    Premier Position in the Marcellus and Utica Acreage position lies near other leading players in the basin Appalachia Overview Marcellus and Utica Map Core acreage proven in both the Utica Marcellus wet gas and the Utica dry gas Dry…
  19. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 19
    Infrastructure Overview Operational Improved run-time No flow restrictions expected Processing Fort Beeler capacity 520 MMBtu/d Total system capacity growing to +1 Bcf/d Central receipt point capacity 140 MMBtu/d Adequate…
  20. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 20
    Marcellus Shale Activity concentrated in liquids-rich portion of the play Marshall & Wetzel Counties, W. Va. Gross Marcellus Production Atinum 50% JV Partner High Btu gas and condensate yields Last well completed 3040 Bbls/MMcf…
  21. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 21
    Marcellus Shale Development Development Plan Marcellus Drilling Locations Gastar has drilled 57 gross (27 net) Marshall Co. Marcellus Wells Producing 57 horizontal wells and one vertical Future Drilling Locations 114 2014 Drilling…
  22. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 22
    Utica Shale Acreage position lies in core of the Dry Gas Window Overview Utica Activity Map(2) Underlies core 11,700 acre Marcellus Rice GPOR Hess 2 wells 1 well position IP: 42 MMcfe/d (Bigfoot 9H) IP: 2945 MMcfe/d IP: 25…
  23. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 23
    Utica Shale Development Simms U-5H one of the most productive wells in the area Simms U-5H Utica Dry Gas Comparative Statistics(1) 48-hour sales rate of Lateral 29.4MMcf/d Operator / IP Rate Length IP / 1000' Well Name County…
  24. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 24
    Utica Acreage is the dry gas Core of the Core Point Pleasant Shale Point Pleasant Shale Porosity Cross-Section Porosity Cross-Section A A GASTAR SIMMS U-5H 4-6% Porosity Up to 17% Porosity VERY HIGH Landing point…
  25. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 25
    Appalachia Summary 2014 Capital Activity 16.0 gross (8.0 net) wells spud 14.0 gross (7.0 net) Marcellus 2.0 gross (1.0 net) Utica 2015 Capital Activity 8.0 gross (4.5 net) wells spud 6.0 gross (3.0 net) Marcellus 2.0 gross (1.5…
  26. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 26
    FINANCIAL OVERVIEW 2014 Gastar Exploration Inc. 28
  27. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 27
    Financial Strategy Goal: Grow NAV and reserves per share through exploitation of existing assets Target leverage of < 3.0x Leverage Ratios and Strong interest and dividend coverage (Interest coverage 3.0x) Liquidity Financial…
  28. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 28
    Production Growth Production growth is anticipated to increase cash flow, reserves and NAV Total Daily Production(1) 20.0 16.8 16.0 Proj. Dec14 Avg. Rate 13.5 44% to 12.0 48% MBoe/d 9.6 10.4 Liquids 45% to 8.0 21% 45%…
  29. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 29
    Capitalization and Liquidity Capitalization(1) ( in millions) 6/30/2014 Adjusted Cash 106.0 Long Term Debt Senior Secured Notes due 2018 314.1 Revolving Credit Facility 0.0 Total Debt 314.1 Total Stockholders Equity 312.2 Total…
  30. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 30
    PDP Hedging Program Liquids Hedging Strategy 3,500 91.77 86.91 83.97 2,800 80.98 80.00 2,100 (Bbl/d) 1,400 700 0 (1) (2) 2014 2015 2016 2017 2018 Volume Average Hedge Floor Price (/Bbl) Downside Hedged %(3) 95% 86%…
  31. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 31
    Key Investment Criteria Strong drilling results in the Hunton Limestone oil play High-Quality Resource Core development position in the liquids-rich Marcellus Shale Base Significant Utica potential under Marcellus Shale…
  32. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 32
    APPENDIX 2014 Gastar Exploration Inc. 34
  33. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 33
    Lower Hunton Non-Operated Drilling Overview Hunton Wells Cumulative Production Averages(2) Approx. Date Flowback Peak Current 5 Day NRI % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Average(3) % Oil(4) (Boe/d)…
  34. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 34
    AMI Drilling Results Lower Hunton Wells are currently outperforming type curve 300,000 20 Thrasher -1H Bledsoe 1-28H 17 Gritz 1-7H 16 Henley 1-11H 240,000 15 16 State School Land 1-36H 14 Stevens 1-36H 13 Jet 1-12H 12…
  35. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 35
    Lower/Upper Hunton Drilling Overview Hunton Wells Cumulative Production Averages(2) Approx. Date Flowback Peak Current 5 Day NRI % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Average(3) % Oil(4) (Boe/d) Lower…
  36. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 36
    Point Pleasant Paleography and SSTVD Structure East and West Appalachian Acreage on same shelf with similar features Point Pleasant Paleogeography Point Pleasant SSTVD Structure Higher porosities in Pleasant Point are Structure is…
  37. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 37
    Simms/Dangel Cross-Section Statoil USA Onshore Prop Inc Dangel 1-H Gastar Simms U-5H 5 Miles to west of Gastars acreage Target Depth: 11,350 TVD Porosity: 6 12% Porosity: Avg. 11% (up to 17%) Net pay of +/- 74 Net pay of 92…
  38. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 38
    Realized Prices - Historical Realized Oil Prices Realized Gas Prices 100.00 93% 90% 100% 6.00 120% 88.00 75% 80% 4.80 89% 100% 72% 81% 80% 81% 87.77 80% 85.12 4.32 76.00 60% 3.60 60% 64.00 70.91 40% 2.40 3.21 3.02 65.45 40%…
  39. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 39
    Production Costs Historical (/Boe) Lease Operating Expense Transportation 9.00 4.00 3.51 7.20 6.74 3.20 5.26 2.25 5.40 2.40 3.60 2.80 2.92 1.60 1.24 0.69 1.80 0.80 0.00 0.00 2011 2012 2013 YTD 06/14 2011 2012 2013 YTD…
  40. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 40
    Realized Prices by Area YTD 6/30/2014 Realized Oil Prices Realized Gas Prices 115.00 120% 6.00 120% 103% 99% 100.00 90% 100% 4.80 89% 100% 87% 80% 4.78 80% 100.11 4.32 85.00 3.60 4.19 54% 87.77 60% 60% 70.00 2.40 40% 40%…
  41. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 41
    Production Costs by Area YTD 6/30/2014 (/Boe) Lease Operating Expense Transportation 12.00 1.20 1.09 9.94 9.60 0.96 7.20 0.69 0.72 5.26 4.80 0.48 2.32 2.40 0.24 0.03 0.00 0.00 Marcellus Mid-Continent Total Company…
  42. JOHNSON RICE ENERGY CONFERENCE – Gastar Exploration, Ltd. – slide 42
    Hedge Detail Natural Gas Oil Period Contract Type Volume Hedged Price Period Contract Type Volume Hedged Price Sep - Dec 14 NYMEX Swap 8,992 MMBtu/d 4.06 Sep - Dec 14 NYMEX Swap 750 Bbl/d 90.35 Sep - Dec 14 NYMEX Swap 2,000 MMBtu/d…

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