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MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd.

Gastar Exploration, Ltd. · Mar 13, 2015 · 47 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. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 1
    Investor Presentation March 2015 E XPANDING 2015 Gastar Exploration Inc. O UR H ORIZONS 1
  2. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 2
    Company Profile Asset Overview (12/31/2014) 2014 Net Prod. by Region Appalachia Mid- Utica Dry Gas(1) Marcellus Shale Play 5.8 MBoe/d 9,600 net acres leased 51,300 net acres Continent 57% 4.4 MBoe/d 1,900 net acres pending 43%…
  3. MARCH 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. MARCH 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 120.0 102.1 96.0 72.0 53% MMBoe 48.0 45% 24.0 23% 28% 47% 0.7% 72% 55% 99.3% 77%…
  5. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 5
    Summary Target Economics 778 net locations for Hunton, Marcellus and Utica, additional 345 net locations in Stack Play Operated and Non- Operated WEHLU Operated WEHLU Operated Hunton Upper Hunton Lower Hunton Marcellus Utica Number…
  6. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 6
    Strategic Plan Maintain financial flexibility and enhance liquidity Selective Capital Balance Sheet Capital Efficiency Deployment Preservation Focus on the projects Push capital to areas Protect and maintain that have the highest…
  7. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 7
    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%…
  8. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 8
    Production Growth Despite 40% decrease in capex, production growth is anticipated to grow 22% Total Daily Production(1) 15.0 12.5 12.0 10.2 8.9 54% to 9.0 2.2 58% 1.4 Liquids MBoe/d 31% 48% Liquids Liquids 1.4 2.7…
  9. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 9
    HUNTON & STACK PLAYS 2015 Gastar Exploration Inc. 11
  10. MARCH 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 117,800 net acres Low all-in acreage cost due to non-core lease sales. Average cash cost 326/acre.…
  11. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 11
    Acreage Location Hunton Sweet Spot Gastar Acreage focused on structurally updip Hunton pinchout Hunton Pinchout Map Pinchout Cross Section Miss. Lime Woodford Upper Hunton Middle & Lower Hunton 1. Note: Images are…
  12. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 12
    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…
  13. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 13
    Non-Operated AMI Activity Encouraging results leading to development 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…
  14. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 14
    Non-Operated AMI Average Well Performance Production and % oil averages better than current type curve 800 640 74% (Boe and % Oil) 480 75% 320 80% 77% 73% 69% 68% 68% 59% 72% 160 67% 66% 76% 82% 0…
  15. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 15
    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…
  16. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 16
    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…
  17. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 17
    Woodford Activity Overview Woodford Activity Map(1) Offset operator IPs up to 1,000 Boe/d Gastar acreage unexplored Other operator activity de-risking OKLAHOMA the play Non-operated participation Checkerboard farm out Three…
  18. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 18
    Meramec/Mississippi Lime Activity Overview Meramec / Miss Lime Activity Map(1) Offset operator IPs range up to 1,800+ Boe/d (80% oil) Meramec play naturally fractured carbonate similar to Hunton Other operator activity…
  19. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 19
    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…
  20. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 20
    MARCELLUS AND UTICA 2015 Gastar Exploration Inc. 22
  21. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 21
    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…
  22. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 22
    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…
  23. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 23
    NE Takeaway Capacity 15 Bcf/d of incremental takeaway capacity announced since YE 2013 1. Source: Tudor Pickering Holt & Co January 2015 Midstream Bulletin 2015 Gastar Exploration Inc. 25
  24. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 24
    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…
  25. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 25
    Marcellus Shale Development Development Plan Marcellus Drilling Locations Gastar has drilled and completed Marshall Co. - Marcellus Wells 70 gross (33.4 net) horizontal wells Producing - 70 Future Drilling Locations 96 Waiting on…
  26. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 26
    Utica Shale Acreage position lies in core of the Dry Gas Window Overview Utica Activity Map(2) Underlies core 11,500 acre Marcellus Rice GPOR Hess 2 wells 1 well position IP: 42 MMcfe/d (Bigfoot 9H) IP: 2945 MMcfe/d IP: 25 MMcfe/d…
  27. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 27
    Utica Shale Development Development Plan Utica Drilling Locations Blake U-7H to be completed and on production by May 2015 Blake U-7H Marshall Co. Utica Wells Producing 1 Future Drilling Locations - 77 Waiting on Completion -1…
  28. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 28
    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…
  29. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 29
    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 97 net Marcellus locations on existing acreage 59 net Utica locations on…
  30. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 30
    FINANCIAL OVERVIEW 2015 Gastar Exploration Inc. 32
  31. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 31
    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…
  32. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 32
    Capitalization and Liquidity Capitalization ( in millions) 12/31/2014 Cash 11.0 Long Term Debt Senior Secured Notes due 2018, net 315.3 Revolving Credit Facility 45.0 Total Debt 360.3 Total Stockholders Equity 350.3 Total…
  33. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 33
    PDP Hedging Program Liquids Hedging Strategy 3,000 2,500 80.00 77.15 77.71 77.55 2,000 (Bbl/d) 1,500 1,000 500 0 (1) 2015 2016 2017 2018 Volume Average Hedge Floor Price (/Bbl) Downside Hedged %(2) 63% 70% 56% 15%…
  34. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 34
    Production Costs Historical (/Boe) Lease Operating Expense Transportation 9.00 4.00 3.51 3.50 7.20 6.74 3.00 5.26 2.50 2.25 5.40 2.00 3.60 2.80 2.92 1.50 1.24 1.00 1.80 0.56 0.50 0.00 0.00 2011 2012 2013 2014 2011 2012…
  35. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 35
    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…
  36. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 36
    APPENDIX 2015 Gastar Exploration Inc. 38
  37. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 37
    Lower Hunton Non-Operated Drilling Overview Well Results Cumulative Production Averages(2) Approx. NRI Date Flowback Peak Current 5 Day % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Average(3) % Oil(4) (Boe/d)…
  38. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 38
    AMI Drilling Results Lower Hunton Wells are in line with current type curve Thrasher -1H 300,000 29 30 28 Bledsoe 1-28H 27 Gritz 1-7H 26 Henley 1-11H 25 State School Land 1-36H 24 25 Stevens 1-36H 240,000 23 Jet 1-12H 22 Jones…
  39. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 39
    Lower/Upper Hunton Drilling Overview Well Results Cumulative Production Averages(2) Approx. NRI Date Flowback Peak Current 5 Day % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Average(3) % Oil(4) (Boe/d) Non-AMI…
  40. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 40
    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…
  41. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 41
    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…
  42. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 42
    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…
  43. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 43
    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…
  44. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 44
    Realized Prices - Historical Realized Oil Prices Realized Gas Prices 100.00 93% 91% 100% 6.00 120% 88.00 75% 80% 4.80 100% 72% 81% 80% 81% 79% 85.12 80% 76.00 81.75 60% 3.60 3.41 60% 70.91 3.21 3.02 64.00 40% 2.40 65.45 40%…
  45. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 45
    Realized Prices by Area 2014 Realized Oil Prices Realized Gas Prices 112.00 120% 6.00 120% 99% 98% 100.00 91% 100% 4.80 96% 76% 79% 88.00 80% 88.84 3.60 4.24 72% 57% 76.00 81.75 60% 3.27 3.41 2.40 39% 48% 64.00 40% 50.96…
  46. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 46
    Production Costs by Area 2014 (/Boe) Lease Operating Expense Transportation 10.00 9.48 1.20 0.99 8.00 0.96 0.72 6.00 5.26 0.72 0.56 4.00 0.48 2.19 2.00 0.24 0.20 0.02 0.00 0.00 Marcellus Utica Mid-Continent Total Company…
  47. MARCH 2015 INVESTOR PRESENTATION – Gastar Exploration, Ltd. – slide 47
    Hedge Detail Natural Gas Oil Period Contract Type Volume Hedged Price Period Contract Type Volume Hedged Price Mar - Mar 15 Prot. Spread 10,000 MMBtu/d 4.46 / 3.70 Mar - Jun 15 Collar 400 Bbl/d 85.00 / 96.50 Mar - Mar 15 Call Spread…

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