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Q1 2015 EARNINGS CALL – Petroquest Energy Inc.

Petroquest Energy Inc. · May 5, 2015 · 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. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 1
    May 2015
  2. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 2
    2014 Recap Proved reserves 34% (Company Record 397 Bcfe) PV-10 27% Production 14% (Company Record 43 Bcfe) Successful drilling programs: De-risked large acreage positions in Woodford and Cotton Valley with excellent drilling…
  3. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 3
    Navigating the Current Environment Flexibility to control capital expenditures Large operated position allows for control of timing of investments -2015E Capex down 67% from 2014 expect free cash flow generation during the second half…
  4. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 4
    Our Properties Gulf Coast Gulf Coast Mid-Con 1Q15 PRODUCTION: RESERVES: 115.3 Mmcfe/d (1) East Texas (69% Long Life) 397.1 Bcfe (1) Mid-Con (86% Long Life) East Texas Gulf Coast Mid-Con INVENTORY: 1.6 Tcfe (2) (91%…
  5. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 5
    Industry Activity - Cotton Valley Trend Relative Rock Quality Comparison PQ13: 12.3 MMcfe/d PQ Cotton Valley Gulf Coast PQ14: 13.5 MMcfe/d Porosity (5%) (10%) (28%) PQ15: 11.4 MMcfe/d PQ Cotton Valley Gulf Coast PQ16: 16.7 MMcfe/d…
  6. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 6
    Cotton Valley Horizontal Horizontal Uplift Horizontal Completions Realizing 11x EUR Uplift vs. Vertical Wells 10 8.6 9 8 7 6 Avg. Bcfe / Well 5 4 3 2 1 0.7 0 61 Vertical Wells 2014 Horizontal Wells (1)…
  7. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 7
    Cotton Valley Horizontal Moving Up the Curve Improving Well Performance 15.4 8.0 5,000 14 11.9 12 7.0 4,500 10 4,232 Average D&C Cost 9.1 4,106 4,147 Lateral Feet 8 7.4 6.0 4,000 6.3 Gas 6 Liquids 6.9 4 5.0…
  8. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 8
    Cotton Valley Horizontal Economics Sensitivity to Gas Prices Horizontal CV Well Economics 85 IRR 78.2% Payback 1.2 yr. 5.0MM D&C 75 IRR 58.2% 65 Payback 1.5 yr. IRR - % 55 IRR 40.1% Payback 2.0 yr. 45 35 3.00 3.25…
  9. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 9
    Cotton Valley Horizontal Planned Activity and Inventory 10
  10. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 10
    Cotton Valley Drilling to Unlock NAV 800 735 700 600 500 125% Growth in reserves since Jan 2014 BCFE 400 300 200 101.5 100 45.3 0 E. Texas Proved 12/31/13 E. Texas Proved 4/1/2015 Net Risked Potential* (8…
  11. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 11
    Gulf Coast Free Cash Flow Generator Fleetwood Project Area Lafayette Key Operating Metrics Houston Ten Year Drilling Success Rate: 70% La Cantera / PV-10 (MM) (12/31/14): 209 Thunder Bayou 1Q15 Production (Mmcfe/d) 35 % Gas:…
  12. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 12
    LaCantera/Thunder Bayou Deeper Pool Tests ERATH FIELD Composite Outline of Field Pay 1.4 TCFE SOUTH ERATH DISCOVERY MID CRIS R HILCORP TIGRE LAGOON/ SOUTH TIGRE LAGOON FIELDS Composite Oultine of Field Pays Cris I, Disc…
  13. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 13
    Fleetwood JV Overview Fleetwood JV Overview Announced a 24 million joint venture agreement to develop a conventional onshore oil play 10MM cash; 14MM carry to earn an average 50% w.i. in partners interest in Fleetwood project…
  14. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 14
    Woodford Position (1) PQ owns approximately 50% of net JV acres 15 arkoma basin
  15. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 15
    Liquidity Metrics and Leverage Liquidity Borrowing Base (MM) * 250 200 220 190 150 125 50 1Q12 3Q13 3Q14 1Q15 New Financial Covenants 1Q15 Senior Secured Debt to Adjusted EBITDA < 2.25x (1)(4) 0.7x Adjusted EBITDA to…
  16. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 16
    Strong Track Record of Funding Drilling with Cash Flow PQ has balanced Capex and cash flow over the past 10 years Direct CapEx (excluding acq.) Cash Flow Other Proceeds (1) 1,600 1,400 190 1,200 1,000 MM 800 600 1,228…
  17. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 17
    Operating Metrics Focus on Cost Reductions Lifting Cost/Mcfe (1) G&A/Mcfe 0.65 0.64 1.50 1.45 1.41 1.40 0.55 0.51 1.35 1.30 1.25 0.45 1.20 1.14 1.15 0.35 1.10 1.05 1.00 0.25 1Q14 1Q15 1Q14 1Q15 Capex MM Avg. Net Daily…
  18. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 18
    Summary Liquidity position (119 million3/31/15)* and control of operations provide flexibility to navigate current environment Capex trending down significantly in 2nd half of the year Redetermination in July moves Thunder Bayou to…
  19. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 19
    Appendix 20
  20. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 20
    Appendix 1 - Hedging Positions Natural Gas Daily Hedged Volumes (Mmbtu) Price 2015 10,000 4.16 2015 5,000 4.00 2015 5,000 3.57 2015 10,000 3.52 Feb15 Dec15 10,000 2.93 Mar15 - Dec15 10,000 3.00 Mar15 Dec15 5,000 2.97 Apr15 Sep15…
  21. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 21
    Appendix 2 Adjusted EBITDA Reconciliation ( in thousands) 2010 2011 2012 2013 2014 LTM 1Q15 Net Income (Loss) available to common 41,987 5,409 (137,218) 8,943 26,051 (106,232) stockholders Income tax expense (benefit) 1,630…
  22. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 22
    Appendix 3 - Discretionary Cash Flow Reconciliation ( in thousands) 2011 2012 2013 2014 Net income (loss) 10,548 (132,079) 14,082 31,190 Reconciling items: Income tax expense (benefit) (1,810) 1,636 320 (2,941) Depreciation,…
  23. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 23
    Appendix 4 Gulf Coast/GOM Free Cash Flow Reconciliation ( in thousands) 2007 2008 2009 2010 2011 2012 2013 2014 Revenues 197,453 198,949 86,880 100,618 86,371 61,788 100,049 121,859 Lease Operating Expense (18,483) ( 25,091)…
  24. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 24
    Appendix 5 Woodford Dry Gas Hoss Field Joint Venture Economic Assumptions Hoss Joint Venture Agreement 38 dry gas wells included in new joint venture JV Terms (1), (2) JV provides extremely beneficial cost sharing provisions for EUR…
  25. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 25
    Appendix 6 - La Cantera Development Lower Cris R-1 200 feet of potential pay Lower Cris R-2, Lobe A 34,000 MCF/D + 700 Bbls of oil (CURRENTLY PRODUCING) Lower Cris R-2, Lobe B 4,000 MCF/D + 100 Bbls of oil (CURRENTLY…
  26. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 26
    Appendix 7 - Panola County Cotton Valley Room to Run Legend Cotton Valley Wells PQ CV Vertical Wells PQ CV Horizontal Wells PQ Area Carthage Field Area of Mutual 4.4 TCF of Interest Unrisked Resource Potential 2.2 Tcfe…
  27. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 27
    Appendix 8 - PQ Operated Gulf Coast Drilling Summary Recent Projects First Prospect NRI Production Feet of Pay I.P. Rate Thibodeaux 1(La Cantera Prospect) 15% March 12 248 Net TVD 36,000 Mcfe Broussard Estates 2 (La Cantera Prospect)…
  28. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 28
    Appendix 9 - Cotton Valley Program Existing CV Vertical Wells PQ 2011 2013 CV Horizontal Wells PQ 2014 (6 Wells) CV Horizontals PQ Near-Term CV Horizontals 29 PETRA
  29. Q1 2015 EARNINGS CALL – Petroquest Energy Inc. – slide 29
    Appendix 10 -Woodford Liquids Rich Gas West Relay Field Economic Assumptions Sensitivity to Gas Prices 125% JV Terms (1), (2) EUR (Bcfe) 4.6 IRR: 97% 100% Gross Well Cost (MM) 4.0 IRR: 79% 75% IP Rate (Mmcfe/d) 7.1 IRR:…

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