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MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd.

Gastar Exploration, Ltd. · May 7, 2015 · 46 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. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 1
    Investor Presentation May 2015 E XPANDING 2015 Gastar Exploration Inc. O UR H ORIZONS 1
  2. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 2
    Company Profile Asset Overview (03/31/2015) Q115 Net Prod. by Region Appalachia 6.76 Utica Dry Gas(1) Marcellus Shale Play Mid- MBoe/d 9,200 net acres leased 50,500 net acres Continent 54% 1,900 net acres pending 5.85 MBoe/d…
  3. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 3
    Key Investment Criteria Strong drilling results in the Hunton Limestone oil play High-Quality Resource Offset Stack Play wells (Meramec and Woodford) successful Base Core development position in the liquids-rich Marcellus Shale…
  4. MAY 2015 INVESTOR PRESENTATION – 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(1) 120.0 102.1 96.0 72.0 53% MMBoe 48.0 45% 24.0 23% 28% 47% 0.7% 72% 55% 99.3%…
  5. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 5
    Summary Target Economics 755 net locations for Hunton, Marcellus and Utica, additional 361 net locations in Stack Play Operated and Non- Operated WEHLU Operated WEHLU Operated Hunton Upper Hunton Lower Hunton Marcellus Utica Number…
  6. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 6
    2015 Capital Budget 92% of drilling budget operated, provides financial flexibility Current 2015 Budget Area Capital (MM) % of Total Mid-Continent Operated 54 52% Land Mid-Continent Non-Operated 6 6% 17 16% Marcellus 16 16%…
  7. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 7
    Production Growth Production is anticipated to grow 22% Total Daily Production(1) 15.0 12.5 12.0 10.2 8.9 51% to 9.0 2.2 55% 1.4 Liquids MBoe/d 31% 48% Liquids Liquids 1.4 2.7 6.0 3.0 6.1 5.3 0.0 2013…
  8. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 8
    Divestiture Overview - Oklahoma 19,000 non-core net acres in Oklahoma OKLAHOMA 46.2MM purchase price 4/1/2015 effective date 170 Boe/d average for Q115 57% gas 38.0 gross (16.7 net) wells Estimated lease renewal costs…
  9. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 9
    HUNTON & STACK PLAYS 2015 Gastar Exploration Inc. 11
  10. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 10
    Hunton: First Mover Advantage Large, contiguous acreage position with multiple horizontal targets Asset Overview Hunton Asset Map 122,700 net acres Low all-in acreage cost due to non-core lease sales OKLAHOMA WEHLU acquisition…
  11. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 11
    Oklahoma Hunton Play Overview Hunton Activity Map Successful drilling results, leading to development OKLAHOMA De-risking by industry activity and historic vertical production in the area Oklahoma Hunton Statistics 1P…
  12. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 12
    Operated Hunton Development 2015 Development Plan Operated Activity Map Focus is on WEHLU Two rigs currently drilling Lower Hunton Development OKLAHOMA 7 horizontal operated wells drilled over large geographic area to date…
  13. MAY 2015 INVESTOR PRESENTATION – 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. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 14
    Non-Operated AMI Activity Overview Non-Operated Activity Map AMI established in 2012 to focus on Lower Hunton development Have drilled 37 wells in the Lower Hunton and 2 wells in the Upper Hunton One well waiting on completion…
  15. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 15
    Non-Operated AMI Average Well Performance Production averages better than current type curve 800 640 74% (Boe and % Oil) 480 72% 320 76% 76% 73% 68% 68% 68% 72% 160 67% 64% 66% 76% 82% 0 Peak Rate…
  16. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 16
    Meramec/Mississippi Lime Activity Overview Meramec / Miss Lime Activity Map(1) Offset operator IPs range up to 1,600 Boe/d (98% oil) OKLAHOMA Meramec play naturally fractured carbonate similar to Hunton Other operator activity…
  17. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 17
    Woodford Activity Overview Woodford Activity Map(1) Offset operator IPs up to 1,000 Boe/d (84%+ oil) OKLAHOMA Gastar acreage unexplored Other operator activity de-risking the play Non-operated participation Checkerboard farm…
  18. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 18
    Oklahoma Summary 2015 Capital Budget Activity Wells spud - 14.0 gross (12.2 net) wells 11.0 gross (10.8 net) operated Hunton wells 3.0 gross (1.4 net) non-operated AMI Hunton wells Wells completed 21.0 gross (16.2 net) wells 13…
  19. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 19
    MARCELLUS AND UTICA 2015 Gastar Exploration Inc. 21
  20. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 20
    Core 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…
  21. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 21
    Infrastructure Overview Operational Improved run-time No flow restrictions expected Processing Total system capacity to 720 MMcf/d Central receipt point capacity 155 MMcf/d Adequate takeaway capacity Firm transport 50…
  22. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 22
    NE Takeaway Capacity 15 Bcf/d of incremental takeaway capacity announced since YE 2013 Source: Tudor Pickering Holt & Co January 2015 Midstream Bulletin 2015 Gastar Exploration Inc. 24
  23. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 23
    Marcellus Shale Activity concentrated in liquids-rich portion of the play Marshall & Wetzel Counties, W. Va. Gross Appalachia Production Atinum 50% JV Partner High Btu gas and condensate yields 3040 Bbls/MMcf condensate 4050…
  24. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 24
    Marcellus Shale Development Development Plan Marcellus Drilling Locations Gastar has drilled and completed Marshall Co. - Marcellus Wells 72 gross (34.4 net) horizontal wells Producing - 72 Future Locations 59 Waiting on Completion…
  25. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 25
    Utica Shale Acreage position lies in core of the Dry Gas Window Overview Utica Activity Map(2) Underlies core 11,100 acre Marcellus Rice GPOR Hess 2 wells 1 well position IP: 42 MMcfe/d (Bigfoot 9H) IP: 2945 MMcfe/d IP: 25 MMcfe/d…
  26. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 26
    Utica Shale Development Development Plan Utica Drilling Locations Blake well completed and is Blake U-7H 6600 Lateral Length Marshall Co. - Utica Wells soaking Waiting On Completion Producing - 1 Waiting on Completion 1 Future…
  27. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 27
    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…
  28. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 28
    Appalachia Summary 2015 Capital Activity Complete 7.0 gross (3.5 net) Marcellus wells Complete 1.0 gross (0.5 net) Utica wells Net Drilling Locations 62 net Marcellus locations on existing acreage 55 net Utica locations on…
  29. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 29
    FINANCIAL OVERVIEW 2015 Gastar Exploration Inc. 31
  30. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 30
    Financial Strategy Goal: Grow NAV and reserves per share through exploitation of existing assets Maintain acceptable leverage and coverage ratios given commodity price environment Leverage Ratios and Financial flexibility through…
  31. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 31
    Capitalization and Liquidity Capitalization ( in millions) 03/31/2015 Cash 12.1 Long Term Debt Senior Secured Notes due 2018, net 315.9 Revolving Credit Facility 65.0 Total Debt 380.9 Total Stockholders Equity 347.4 Total…
  32. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 32
    PDP Hedging Program Liquids Hedging Strategy 3,500 2,800 77.71 80.00 74.78 74.73 (Bbl/d) 2,100 1,400 700 0 (1) 2015 2016 2017 2018 Volume Average Hedge Floor Price (/Bbl) Downside Hedged %(2) 73% 70% 65% 15% Gas…
  33. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 33
    Production Costs Historical (/Boe) Lease Operating Expense Transportation 9.00 4.00 3.51 7.20 6.74 3.20 5.26 5.30 2.25 5.40 2.40 3.60 1.60 1.24 2.80 2.92 1.80 0.80 0.56 0.44 0.00 0.00 2011 2012 2013 2014 Q1'15 2011…
  34. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 34
    Key Investment Criteria Strong drilling results in the Hunton Limestone oil play High-Quality Resource Offset Stack Play wells (Meramec and Woodford) successful Base Core development position in the liquids-rich Marcellus Shale…
  35. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 35
    APPENDIX 2015 Gastar Exploration Inc. 37
  36. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 36
    Lower Hunton Non-Operated Drilling Overview Well Results Cumulative Production Averages(2) Date Flowback Peak Current 5 Day Approx. NRI % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Average(3) % Oil(4) (Boe/d)…
  37. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 37
    AMI Drilling Results Lower Hunton Wells are in line with current type curve Thrasher -1H 300,000 40 Bledsoe 1-28H Gritz 1-7H Henley 1-11H 35 State School Land 1-36H 34 Stevens 1-36H 33 32 Jet 1-12H 31 Jones 1-21H 240,000 32…
  38. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 38
    Lower/Upper Hunton Drilling Overview Well Results Cumulative Production Averages(2) Date Flowback Peak Current 5 Day Approx. NRI % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Average(3) % Oil(4) (Boe/d)…
  39. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 39
    Utica Shale Development Well results continue to improve as operators gain knowledge Simms U-5H Utica Dry Gas Results(1) 48-hour sales rate of Lateral Announced Operator / IP Rate Length IP / 1000' 29.4MMcf/d (9/4/2014) Order Well…
  40. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 40
    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…
  41. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 41
    Point Pleasant Gross Isopach Thickness Low thickness variations in the Point Pleasant across Gastars acreage CVX Conner 6H GPOR IP: 25 MMcf/d Irons 4H IP: 30.3 MMcf/d Eclipse Shroyer 2H & 4H GST Combined IP: 42.5 MMcf/d…
  42. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 42
    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…
  43. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 43
    Realized Prices - Historical Realized Oil Prices Realized Gas Prices 100.00 93% 91% 92% 100% 6.00 120% 86.00 75% 80% 4.80 100% 72% 81% 80% 81% 79% 85.12 71% 80% 81.75 72.00 60% 3.60 70.91 3.41 60% 65.45 3.21 3.02 58.00 40%…
  44. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 44
    Realized Prices by Area Q115 Realized Oil Prices Realized Gas Prices 60.00 120% 6.00 111% 120% 103% 92% 4.80 96% 50.00 96% 71% 40.00 46.87 72% 3.60 59% 72% 41.82 53% 45% 2.40 3.18 48% 30.00 48% 20.27 1.20 2.03 24% 20.00 24%…
  45. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 45
    Production Costs by Area Q115 (/Boe) Lease Operating Expense Transportation 12.00 0.96 0.83 10.00 9.54 0.72 0.61 8.00 6.00 5.30 0.48 0.44 4.00 0.24 1.79 2.00 0.09 0.01 0.00 0.00 Marcellus Utica Mid-Continent Total…
  46. MAY 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 46
    Hedge Detail Natural Gas Oil Period Contract Type Volume Hedged Price Period Contract Type Volume Hedged Price Apr - Dec 15 NYMEX Swap 400 MMBtu/d 4.00 Apr - Jun 15 Collar 400 Bbl/d 85.00 / 96.50 Apr - Dec 15 NYMEX Swap 2,500 MMBtu/d…

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