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TPH Hotter N Hell Energy Coference – Jones Energy Inc.

Jones Energy Inc. · Jun 18, 2014 · 29 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. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 1
    TPH Hotter N Hell Energy Conference June 18, 2014
  2. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 2
    Key Statistics IPO Date: July 29, 2013 Ticker: JONE Exchange: NYSE IPO Shares: 12,500,000 Total Outstanding Shares: 49,362,913 (12,526,580 Class A, 36,836,333 Class B) Share Price as of June 9, 2014: 18.60 Market…
  3. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 3
    Company Summary Production (MBoe/d) Jones Energy Total 22.5 Proved Reserves: 89.0 MMBoe 17.0 Drilling Locations: 2,542 13.3 Canadian Net Acres: 115,000 (80% HBP) Daily Production: 21.5 MBoe/d McAlester Anadarko Basin Key…
  4. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 4
    Investment Highlights Basin-centric operator Geographic focus Anadarko and Arkoma focus Driven by well level returns with a growing liquids component Drilled 500 horizontal wells Low-cost leader Best in class Cleveland and Woodford…
  5. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 5
    2014 Is Off To A Great Start Compared to the fourth quarter of 2013: EBITDAX is up 38% Crude oil production is up 37% Liquids production is up 29% Total production is up 19% All 20 of the Cleveland frack trial wells have been…
  6. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 6
    90 Year Legacy of Success in the Oil & Gas Industry A.V. Jones, Jr. Jon Rex Jones A.V. Jones begins Jon Rex Jones joins Jones drills first Sells Hansford Co. Acquires Crusader Acquires Chalkers Acquires Sabines work for Marland…
  7. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 7
    25 Year Mid-Con Experts Jones has drilled 500 horizontal wells to date in 9 target formations Mid-con Strat Column System Series / Generalized 600 Epoch Stratigraphic Column Brown Dolomite (wells drilled each year) Hugoton /…
  8. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 8
    2014 Development Plan Projecting over 30% production growth in 2014 Gross Wells Net Wells Total Capex - 350mm 1% 1% 8% 2% 6% 13% 6% 18% 14% 85% 72% 74% Cleveland D&C - 250mm Cleveland Woodford Woodford D&C - 50mm…
  9. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 9
    How Jones Creates Unmatched Value in the Cleveland IRR 60% Emphasis on Cycle Time 60% Focus on efficiency from spud to first production These five elements Vendor Management 50% create nearly 1 million Competition from multiple…
  10. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 10
    Cleveland Play Evolution: 1997-2005 SCHULTZ BROS. 5H IP30: 2322 MCF/D 7 BOP/D LIPSCOMB WOODWARD ELLIS HANSFORD OCHILTREE WET WHEAT 341-2H IP30: 2730 MCF/D 14 BOP/D HUTCHINSON DEWEY ROBERTS HEMPHILL ROGER MILLS…
  11. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 11
    Cleveland Play Today JOHN B DOYLE 703-15H IP30: 2745 MCF/D 645 BOP/D LIPSCOMB WOODWARD ELLIS HANSFORD JONES TRUST 189-4H IP30: 1296 MCF/D 684 BOP/D OCHILTREE BIG LAKE 102-2H IP30: 5756 MCF/D 287 BOP/D KELLN 65-2H…
  12. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 12
    Cleveland Inventory Continues to Grow Opportunity set is large with play spanning 3,300 square miles 800 Sabine 700 Chalker 600 500 Crusader 400 Shattuck Exxon 300 200 100 - 2004 2005 2006 2007 2008 2009…
  13. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 13
    Historical Cleveland Operating Data Rate of Penetration (Ft per day) [1] Lateral Length (Feet) [1] 532 4,260 4,088 3,948 478 473 3,854 462 3,600 3,586 448 3,476 426 428 410 393 2,381 354 2,056 1,791 2004 2005 2006 2007…
  14. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 14
    Strong IP 30s and Low Costs Allow Us to Generate High Returns Cleveland IP 30 Historical Data (2011-2013) [1] 3-Year IP30 Average: 504 Boe/d 30 25 20 Well Count (106) 15 10 5 0 0-50 50-100 100-200 200-300 300-400…
  15. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 15
    Woodford Overview Solid returns with running room Highlights Active Operators Spud 50 horizontal wells in Hughes Vanguard AMI (6 Active Rigs) the Woodford Pittsburg Currently running a two rig (2) (1) program Pablo New wells…
  16. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 16
    Tonkawa Overview Provides incremental growth opportunity with 209 drilling locations Key Well Results in JONE 2014 Focus Area Apache IP30 930 BOPD + 1,546 MCFD Apache IP30 552 BOPD + 783 MCFD Apache IP30 364 BOPD +…
  17. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 17
    Why Investors Should be Bullish on Jones Mid-Con Focus A history of success in the region has lead to the reputation as a partner of choice Expertise creates opportunities to acquire at favorable prices Best-in-Class Operations…
  18. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 18
    APPENDIX
  19. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 19
    2014 Full Year Guidance and Q2 Production Guidance Full Year Total Production (MMBoe)[1] 8.0 - 8.4 Full Year Average Daily Production (MBoe/d)[1] 22.0 - 23.0 Second Quarter Total Production (MMBoe)[1] 2.00 - 2.05 Second Quarter…
  20. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 20
    2014 Blended Production Profiles Cleveland Single Well Profile[1] 1,000 1,000 Oil Wet Gas Total[2] % Liquids 67% IP Bbl/D Mcf/D Boe/D % Oil 35% 30 Day IP 285 947 501 90 Day IP 190 787 370 Gas Shrink 31% Cum. Production MBbl MMcf…
  21. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 21
    Cleveland Frack Trial Open Hole Completion System Cased + Perf Open Hole Completion System Cased + Perf Multiple Stages: 20 23 Clusters: N/A 69 (3/stage) 3.5x Spacing (ft): 210 60 Prop (MMlb): 1.5 6.9 4.6x Water (Mbbl): 42 117…
  22. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 22
    Trusted Partner for Numerous Large E&P Companies Jones controls drilling and completion in all deals Selected Active Partnerships Company Active Formation History Total Remaining Locations Partner since 2000, Cleveland 273 157…
  23. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 23
    Hedge Volumes 2014 2015 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Oil and Gas Swaps Crude Oil (Mbbl) 469 426 399 359 327 301 284 Natural Gas (MMcf) 3,890 4,020 3,530 3,152 2,945 2,750 2,556 Conway NGLs (Mbbl) Ethane 128 109 106 60 55 51 46 Propane…
  24. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 24
    Hedge Pricing 2014 2015 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Oil and Gas Swaps Crude Oil ( / Bbl) 91.04 91.10 91.14 88.82 88.84 89.76 89.81 Natural Gas ( / Mcf) 4.84 4.88 4.89 4.84 4.84 4.87 4.89 Conway NGLs ( / Gal) Ethane 0.18 0.18 0.18 0.20…
  25. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 25
    Corporate Structure Metalmark, Management Public & Other Investors Shareholders Class B Common Stock Class A Common Stock 74.7% of voting power in 25.3% of voting power in Jones Energy, Inc. Jones Energy, Inc. 74.7% of total…
  26. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 26
    Up-C Structure Overview JONE went public using an Up-C structure Other recent energy IPOs with Up-C structure include: Athlon Energy Inc. Franks International N.V. Parsley Energy, Inc. Due to the Up-C structure, on its financial…
  27. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 27
    Forecasting JONE EPS The simplest way to forecast JONE EPS is on a 100% basis: Income before income tax - Income tax provision (36.5% of pre-tax income*) Net income Total Class A and B shares outstanding of 49,362,913 Net…
  28. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 28
    Forecasting JONE EPS Alternatively, EPS can be calculated using net income attributable to controlling interests and Class A shares outstanding: Income before income tax on 100% basis - Pre-tax income attributable to non-controlling…
  29. TPH Hotter N Hell Energy Coference – Jones Energy Inc. – slide 29
    Understanding JONE EPS Calculation on Reported Financial Statements Breakdown of JONE Income Tax Calculation ( in millions, except per share data) JONE Q1 2014 Income Statement Income before income tax ( in thousands, except per share…

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