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OGIS New York Presentation – Linn Energy, Llc

Linn Energy, Llc · Apr 16, 2012 · 35 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. OGIS New York Presentation – Linn Energy, Llc – slide 1
  2. OGIS New York Presentation – Linn Energy, Llc – slide 2
    OGIS New York Presentation April 16, 2012
  3. OGIS New York Presentation – Linn Energy, Llc – slide 3
    LINN Energys mission is to acquire, develop and maximize cash flow from a growing portfolio Embrace & Drive Change of long-life oil and natural gas Pursue Growth assets. Take Action Respect Others Be Passionate Connect
  4. OGIS New York Presentation – Linn Energy, Llc – slide 4
    LINN Overview 8th largest public MLP/LLC and 11th largest domestic independent oil & natural gas company(1) IPO in 2006 (NASDAQ: LINE) Equity market cap 7.7 billion Salt Creek Field ND Total net debt 4.7 billion Enterprise value…
  5. OGIS New York Presentation – Linn Energy, Llc – slide 5
    Recent Highlights Announced 4 acquisitions totaling 2.3 billion since November 2011(1) 1.8 billion of assets consisting of single-digit decline rates April 2012 - 400 million joint venture with Anadarko (APC) in the Salt Creek oil…
  6. OGIS New York Presentation – Linn Energy, Llc – slide 6
    Proven Growth Strategy 73% increase in quarterly distribution since IPO Generated total return of 221% LINE Historical Enterprise Value(1)(2) +24% increase since Q411 10,000 Enterprise Value (MM) 7,500 5,000…
  7. OGIS New York Presentation – Linn Energy, Llc – slide 7
    MLP and Independent E&P Rankings LINN is quickly becoming one of the largest MLP and independent E&P companies 8th largest public MLP/LLC 11th largest domestic independent oil & natural gas company Rank Master Limited Partnership…
  8. OGIS New York Presentation – Linn Energy, Llc – slide 8
    Strategic Rationale APC Salt Creek JV 100% oil, high margin asset Excellent MLP Low decline rate…
  9. OGIS New York Presentation – Linn Energy, Llc – slide 9
    Salt Creek Field 1900s Horse-drawn team hauling 60 barrels of oil from Salt Creek to refinery in Casper. Transporting equipment to Salt Creek. 10
  10. OGIS New York Presentation – Linn Energy, Llc – slide 10
    Overview APC Salt Creek JV Acquisition Overview Sheridan Park Received 23% of Anadarkos interest in the Salt Creek Big Horn Campbell Crook field, located in Wyomings Powder River Basin Wyoming Salt Creek Washakie Weston Expect to…
  11. OGIS New York Presentation – Linn Energy, Llc – slide 11
    Hugoton Acquisition Fits The MLP Model On March 30, 2012, LINN closed a 1.2 billion acquisition in the liquids-rich Kansas Hugoton Field from BP America. Finney Liquids-Rich Hamilton Liquids-rich production of 110 MMcfe/d Kansas…
  12. OGIS New York Presentation – Linn Energy, Llc – slide 12
    Granite Wash Operated Horizontal Drilling Activity (Greater Stiles Ranch) 7TH STEP MENDOTA TWIN CHANNELS Roger Mills County Over 600 horizontal locations 29 operated wells drilled in 2011 Hemphill County Hemphill BUFFALO…
  13. OGIS New York Presentation – Linn Energy, Llc – slide 13
    Granite Wash Horizontal Production Growth 600 horizontal locations; or 10+ year inventory at current pace Increased net production 34% in Q411 compared to Q311 Significantly increased LINNs Granite Wash position through PXP…
  14. OGIS New York Presentation – Linn Energy, Llc – slide 14
    Granite Wash / Atoka Wash Stratigraphy Horizontal drilling has significantly changed well results and returns in the Granite Wash PRODUCING LATERAL BOREHOLES ZONES VIR- 9,400 Tonkawa Operational Update GILIAN Lansing LINN has…
  15. OGIS New York Presentation – Linn Energy, Llc – slide 15
    LINN Provides Both Organic & Acquisition Growth LINN is unique in that it provides investors with the potential for significant organic and acquisition growth Horizontal Granite Wash Permian Basin (Wolfberry) o 10 year drilling…
  16. OGIS New York Presentation – Linn Energy, Llc – slide 16
    Financial Overview
  17. OGIS New York Presentation – Linn Energy, Llc – slide 17
    Financial Highlights Distribution growth of 10% in the last 19 months Excellent acquisition track record 1.4 billion(1) in 2010 1.5 billion(1) in 2011 1.8 billion(2) in 2012 Significant 2012 growth Year-over-year organic growth of…
  18. OGIS New York Presentation – Linn Energy, Llc – slide 18
    Strong Performance and Growth Reserves (Bcfe) Production (MMcfe/d) 5,000 600 (1) (2) 4,322 520 500 4,000 3,370 400 369 3,000 2,597 300 265 1,712 212 218 2,000 1,660 1,419 200 1,000 87 100 255 8 0 0 2006 2007 2008 2009…
  19. OGIS New York Presentation – Linn Energy, Llc – slide 19
    Continued Success in Acquisition Activity Record amount of Record amount of Record amount of negotiations in 2010 transactions closed in 2011 transactional value YTD(3) Screened 189 opportunities Screened 122 opportunities Screened…
  20. OGIS New York Presentation – Linn Energy, Llc – slide 20
    Significant Hedge Position LINN is hedged 100% on expected natural gas production through 2015; and 100% on expected oil production through 2014 and 90% in 2015 Puts provide price upside opportunity Natural Gas Positions Oil…
  21. OGIS New York Presentation – Linn Energy, Llc – slide 21
    Significant Hedge Position (Equivalent Basis) LINNs cash flow is notably more protected from oil and natural gas price uncertainty than its C-corp. peers C-corp. peer group has only hedged on average 44% and 22% of their expected…
  22. OGIS New York Presentation – Linn Energy, Llc – slide 22
    Distribution Stability and Growth 73% increase in quarterly distribution since IPO Distribution stability maintained throughout the credit crisis (i.e. 2008 2009) 16 out of 74 MLPs (or 23%) were forced to reduce or suspend…
  23. OGIS New York Presentation – Linn Energy, Llc – slide 23
    Distribution History Consistently paid the distribution for 24 quarters Consistent yield generates long-term returns Distribution History 14.39 13.70 13.01 0.69 14.00 12.32 0.69 0.69 11.66 0.66 11.00 12.00 10.34 0.66 9.71…
  24. OGIS New York Presentation – Linn Energy, Llc – slide 24
    Size Advantage in E&P MLP/LLC Market LINN has a significant size advantage in the E&P market presents significantly more E&P MLP/LLC market acquisition opportunities than rest of MLP Greater access to capital markets market Ability…
  25. OGIS New York Presentation – Linn Energy, Llc – slide 25
    LINN Historical Return LINN Total Return and Stock Price Appreciation (LINE IPO Present of 221%) 250% 225% 221% 200% 175% 150% 141% 125% 100% 84% 75% 50% 33% 25% 24% 0% -25% -50% 2006 2007 2008 2009 2010 2011…
  26. OGIS New York Presentation – Linn Energy, Llc – slide 26
    Why Invest in LINN High quality asset base Stable Multi-year inventory of liquids-rich development opportunities 48% liquids Distributions Long-life reserves (21 years) Diversified asset base (6 core areas / 15,000 producing…
  27. OGIS New York Presentation – Linn Energy, Llc – slide 27
    LINN Energys mission is to acquire, develop and maximize cash flow from a growing portfolio Embrace & Drive Change of long-life oil and natural gas Pursue Growth assets. Take Action Respect Others Be Passionate Connect
  28. OGIS New York Presentation – Linn Energy, Llc – slide 28
    Appendix
  29. OGIS New York Presentation – Linn Energy, Llc – slide 29
    LINN Overview Salt Creek Field ND WY MI Hugoton Field CA IL KS TX Panhandle Oklahoma Shallow TX Panhandle OK Granite Wash East Texas NM TX LINN Operations Corporate Headquarters LA Recent and Pending (Houston)…
  30. OGIS New York Presentation – Linn Energy, Llc – slide 30
    As used herein, Pro Forma Proved Reserves represents the sum of (i) the Companys estimated proved reserves as of December 31, 2011, and (ii) the estimated proved reserves acquired in the Hugoton acquisition. The following table sets…
  31. OGIS New York Presentation – Linn Energy, Llc – slide 31
    Historical Financial Statements Reconciliation of Non-GAAP Measures The Company defines adjusted EBITDA as net income (loss) plus the following adjustments: Net operating cash flow from acquisitions and divestitures, effective date…
  32. OGIS New York Presentation – Linn Energy, Llc – slide 32
    Historical Financial Statements Adjusted EBITDA The following presents a reconciliation of net income (loss) to adjusted EBITDA: Three Months Ended Year Ended December 31, December 31, 2011 2010 2011 2010 (in thousands) Net…
  33. OGIS New York Presentation – Linn Energy, Llc – slide 33
    Historical Financial Statements Adjusted Net Income The following presents a reconciliation of net income (loss) to adjusted net income: Three Months Ended Year Ended December 31, December 31, 2011 2010 2011 2010 (in thousands,…
  34. OGIS New York Presentation – Linn Energy, Llc – slide 34
    Reserve Replacement / F&D Calculations Reconciliation of Non-GAAP Measures Year Ended December 31, 2011 2010 Costs incurred (in thousands): Costs incurred in oil and natural gas property acquisition, exploration and development…
  35. OGIS New York Presentation – Linn Energy, Llc – slide 35
    The U.S. Securities and Exchange Commission (SEC) permits oil and gas companies, in their filings with the SEC, to disclose only resources that qualify as reserves as defined by SEC rules. We use terms describing hydrocarbon quantities in…

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