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CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp.

Ultra Petroleum Corp. · Dec 4, 2012 · 38 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. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 1
    Ultra Petroleum Corp. Michael D. Watford Chairman, President and CEO CapitalOne Southcoast Energy Conference December 4, 2012 Ultra Petroleum Corp. is an independent exploration and production company focused on developing its…
  2. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 2
    A Unique Energy Company Exploration & Production company uniquely focused on profitable growth 31% return on equity for 2011 15% production growth for 2011 Growing scale of our assets Early development of Wyoming legacy asset…
  3. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 3
    2011 Results Produced 245.3 Bcfe; 15% growth 1.5B capital budget 4.98 Tcfe proved reserves; 13% growth 339% Organic reserve replacement ratio Drill-bit F&D cost of 1.60/Mcfe Ultra Petroleum Corp. NYSE: UPL 3
  4. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 4
    The Ultra Petroleum Story High asset quality Robust investment portfolio Profitable growth strategy Ultra Petroleum Corp. NYSE: UPL 4
  5. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 5
    Long-Life, Low-Cost, Lance Tight Gas Ultra-Interest Wells Pinedale Field 90 sq. miles 2,000+ wells 1.5 Bcfd Field OGIP = 58.7 Tcf Recoverable = 38.2 Tcf Jonah Field 36 sq. miles 1,760+ wells 0.8 Bcfd Field OGIP = 15.0…
  6. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 6
    Wyoming Asset Overview Key Metrics Inventory Production* Reserves 2,000+ producing 716 Mmcfe/d 4.3 Tcfe proved wells YE2011 gross operated 9.7 Tcfe proved + 5,000+ future production probable locations 489 Mmcfe/d 10.2 Tcfe proved + <…
  7. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 7
    Pinedales Profitable Well Economics 300% 4.00 6.00 Bcfe Bcfe 250% Vertical Depth 13,500 13,500 Well Cost (MM): 4.6 4.6 200% IRR*: 37% 90% F&D Cost/Mcfe: 1.44 0.96 150% Payout, months: 35 17 IRR Reserve Life, yrs: 32 38 100%…
  8. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 8
    Abundant Marcellus Shale Play Ultra-Interest Lands Potter-Tioga Area 170,000 net acres 130 producing horizontal wells Year-end 2011 Clinton-Lycoming Area 90,000 net acres 74 producing horizontal wells Year-end 2011…
  9. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 9
    Pennsylvania Asset Overview Key Metrics Inventory Production* Reserves 204 producing 527Mmcfe/d 0.7 Tcfe proved wells YE2011 gross production 1.7 Tcfe proved + 4,500 future 196 Mmcfe/d probable locations net production 5.8 Tcfe proved…
  10. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 10
    Strong Marcellus Well Economics 200% 180% 5.0 7.0 9.0 160% Bcfe Bcfe Bcfe 140% Vertical Depth 5,600 8,400' 8,400' Well Cost: 7.8MM 6.2MM 6.2MM 120% IRR*: 20% 76% 132% 100% IRR F&D Cost/Mcfe: 1.84 1.01 0.79 80% Payout, months: 66…
  11. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 11
    Conservative Type Curve Estimates 8.0 7.0 Clinton-Lycoming Area Potter-Tioga Area 6.0 5.0 Gross Production (MMcfe/D) 4.0 7 Bcfe 3.0 2.0 5 Bcfe 1.0 0.0 1 91 181 271 361 451 541 631 Days Ultra Petroleum…
  12. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 12
    Net Risked Resource Potential Wyoming Pennsylvania Total Lance Marcellus Resource 10.2 Tcfe 9.5 Tcfe 19.7 Tcfe 2,900 future 2,500 future 5,400 future net wells net wells net wells 13,600MM 17,800MM 31,400MM future capital future…
  13. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 13
    Improving Operating Efficiencies 40 100% Pinedale Field 35 80% 30 25 Spud to TD 60% Spud to TD % Wells Drilled (Days) 20 Reduced by 66% < 15 Days 15 40% 10 Spud to TD 20% 5 % Wells Drilled < 15 days 0 0% 2007 2008 2009…
  14. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 14
    Leads to Further Cost Reductions 7.0 Pinedale Field Completed Well Costs 6.0 Reduced by 23% 5.0 4.0 Completed Well Cost (MM) 3.0 2.0 1.0 0.0 2007 2008 2009 2010 2011 Ultra Petroleum Corp. NYSE: UPL 14
  15. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 15
    Industrys Low-Cost Operator 12.00 2011 All-In Costs 10.00 Ultra - 2.88 vs. Mean - 6.46 8.00 All-in Costs 6.00 (Mcfe) 4.00 2.00 - Source: Wells Fargo 9.00 2011 All-In F&D Costs 8.00 7.00 6.00 Ultra - 1.82 F&D Costs…
  16. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 16
    Focused on Creating Long-Term Value UPL CROCI - 23% Production per share CAGR - 23% 20% High Returns SWN Low Growth (50%, 21%) 17% QEP High Returns OXY BBG High Growth MUR 14% NBL NFX CXO BRY 2009 - 2011 APA EOG CROCI…
  17. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 17
    The Ultra Petroleum Story High asset quality Robust investment portfolio Profitable growth strategy Ultra Petroleum Corp. NYSE: UPL 17
  18. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 18
    2011 Proved Reserves SEC Proved Reserves 4.98 Tcfe PDP increase of 17% Drillbit F&D - 1.60 per Mcfe 339% reserve replacement PUD to 1P location ratio of 1.9 0.80:1 PDP PDNP PUD 2.93 0.15 5.3B PV-10 value 4.04/Mcf Ultra…
  19. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 19
    2011 Real Reserve Value Net 6/Mcf 5/Mcf Reserves PV-10 PV-10 Reserve Category (Bcfe) MM MM Proved* 7,260 11,786 8,913 Probable 4,115 3,255 1,996 2P: (Proved + Probable) 11,375 15,041 10,909 Possible 4,675 3,702 2,288 3P: (Proved +…
  20. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 20
    The Ultra Petroleum Story High asset quality Robust investment portfolio Profitable growth strategy Ultra Petroleum Corp. NYSE: UPL 20
  21. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 21
    Impressive Performance Record Net Income Cashflow ROCE ROE Breakeven Breakeven (last 5 years) (last 5 years) (last 5 years) (last 5 years) 2.60 1.13 21% 36% per Mcfe per Mcfe Average Average Average Average Year - to -…
  22. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 22
    Strong & Stable Margins Cash Flow Margin Net Income Margin 100% 50% 90% 45% 80% 40% 70% 35% 60% 30% 50% 25% 40% 20% 42% 72% 75% 73% 37% 70% 70% 30% 15% 31% 31% 30% 20% 10% 10% 5% 0% 0% 2007 2008 2009 2010 2011 2007 2008…
  23. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 23
    Consistent Absolute Growth Proved Reserve Growth Production Growth 5,000 300 14% CAGR 4,500 21% CAGR 250 4,000 3,500 200 3,000 Bcfe 2,500 Bcfe 150 2,000 100 1,500 1,000 50 500 0 0 2007 2008 2009 2010 2011 2007 2008…
  24. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 24
    And Leaders in Per-Share Growth Proved Reserves per Share Production per Debt-Adjusted Growth Share Growth 20% 18% 17% 18% 16% 16% 14% 13% 14% 12% 12% 10% 2006 - 2011 9% 2006- 2011 9% 10% CAGR CAGR 8% 8% 6% 6% 4%…
  25. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 25
    Outlook for 2012 2012 Capital Investment Program 800MM Target drilling program 4% 4% 25% 133 gross (54 net) Wyoming wells 20% 76 gross (32 net) Pennsylvania wells Production goal 250 260 Bcfe 4% 109 gross (47 net) producing…
  26. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 26
    Where Are We Going 2010A 2011A 2012E Operations Realized price (/Mcf) 4.88 5.05 4.05 Capex (MM) 1,576 1,514 600* Production (Bcfe) 214 245 255 Income Statement (MM) EBITDA 818 1,034 840 Balance Sheet (MM) Ending debt balance…
  27. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 27
    The Ultra Petroleum Story High Highly concentrated asset Domestic, onshore natural gas asset quality Lowest all-in unit costs Robust 5,400 future net drilling locations 20+ years inventory investment portfolio High rate-of-return…
  28. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 28
    Appendix Ultra Petroleum Corp. NYSE: UPL 28
  29. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 29
    New Ventures Activity 140,000 net acres in the DJ Basin Targeting liquids-prone Niobrara Formation Resource exposure 200,000 400,000 Bbls of oil per well 150,000 MBbls oil net resource upside Play attractiveness Available acreage…
  30. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 30
    Consistent Marcellus Performance Wellsboro Area 45 wells starts YTD Krause Area Avg. IP = 7.1 MMcf/d Krause 4 wells starts YTD Wellsboro Avg. IP = 8.3 MMcf/d Marshlands Potter Tioga Texas Creek Grugan Clinton Lycoming…
  31. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 31
    Marcellus Technical Reviews: What We are Learning High-grading acreage to optimize returns Utilizing seismic attributes to delineate resource sweet spots Sweet spot EURs 2.5 times better than non-sweet 3D coverage expanded to 455…
  32. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 32
    Northern Pennsylvania Pipeline Capacity Additions Incremental Projects* Capacity Total Date Current Capacity 4.1 Bcf/d Q4 2012 Marc 1 0.50 Bcf/d Total - 2012 4.6 Bcf/d Year-end 2012 Tennessee 300** 0.85 Bcf/d Total - 2013 5.5 Bcf/d…
  33. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 33
    Financial Strength Total Debt Capacity 3,165MM Maturity Profile 1,000 900 September 30, 2012 800 700 600 millions 500 400 Debt/EBITDA 300 Short-term 2.38X Net Debt 200 Liquidity 2,101MM 100 600MM EBITDA/Interest 10.2X…
  34. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 34
    Providing Certainty to Cash Flow: Hedging Summary Total Volume Average Price Time Period (Bcf) (/MMbtu) Q4 2012 48.8 4.27 Ultra Petroleum Corp. NYSE: UPL 34
  35. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 35
    Profitable Reinvestment Opportunities Reserve Size - Pinedale Wells 4 Bcfe 5 Bcfe 6 Bcfe 7 Bcfe 8 Bcfe 3/Mcf 12% 21% 33% 46% 62% Gas Price 4/Mcf 23% 38% 57% 81% 110% 5/Mcf 37% 60% 90% 129% 178% 6/Mcf 54% 88% 134% 194%…
  36. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 36
    Production and Financial Guidance 2012 (E) Production 250 260 Bcfe Q4 2012 realized pricing Natural gas: 2 - 4% discount to NYMEX Condensate: 6.00 discount to NYMEX Q4 2012 expense guidance Assumes 3.48 per Mmbtu and 87.75 per…
  37. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 37
    Narrowing Basis Differentials Basis Differential as a Percentage (%) of Henry Hub Balance 2007 2008 2009 2010 2011 2012 2012 2013 2014 NW Rockies 58 69 77 90 94 94 100 97 97 Dominion South 105 105 107 104 104 101 101 99 98…
  38. CAPITAL ONE SOUTHCOAST ENERGY CONFERENCE – Ultra Petroleum Corp. – slide 38
    Expanding Rockies Capacity 12.0 Excess takeaway 10.0 capacity 4.5 Bcf/d 8.0 Average Daily Volume 6.0 (Bcf/D) 4.0 2.0 0.0 Source: Bentek Energy Actual Forecast Pipeline Capacity Ultra Petroleum Corp. NYSE:…

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