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Q4 2012 Update – National Fuel Gas Co.

National Fuel Gas Co. · Nov 2, 2012 · 53 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. Q4 2012 Update – National Fuel Gas Co. – slide 1
    National Fuel Gas Company Investor Presentation November 2012
  2. Q4 2012 Update – National Fuel Gas Co. – slide 2
    National Fuel Gas Company November 2012 Our Business Mix Leads to Long-Term Value Creation Upstream Upstream Midstream Downstream Crude Oil Natural Gas Seneca Resources Seneca Resources National Fuel Gas National Fuel Gas…
  3. Q4 2012 Update – National Fuel Gas Co. – slide 3
    National Fuel Gas Company November 2012 Integrated Business Mix Provides Financial Balance 1,000 Utility Segment Pipeline & Storage Segment Exploration & Production Segment Midstream, Energy Marketing & Other 750 Adjusted…
  4. Q4 2012 Update – National Fuel Gas Co. – slide 4
    National Fuel Gas Company November 2012 Integrated Businesses with Significant Marcellus Exposure (1) Footnote 1 goes here (2) Footnote 2 goes here 5
  5. Q4 2012 Update – National Fuel Gas Co. – slide 5
    National Fuel Gas Company November 2012 And Exposure to Growth from the Utica Shale (1) Footnote 1 goes here (2) Footnote 2 goes here 6
  6. Q4 2012 Update – National Fuel Gas Co. – slide 6
    National Fuel Gas Company November 2012 Capital Spending Flexibility to Maintain Financial Strength Additional infrastructure expansions are being Utility aggressively pursued and as a result, additional 1,250 Pipeline & Storage…
  7. Q4 2012 Update – National Fuel Gas Co. – slide 7
    National Fuel Gas Company November 2012 Strong Balance Sheet and Liquidity Position Total Debt(1) 44% Capital Resources Total Short-Term Capacity: 1,085 Million Committed Credit Facility: 750 Million Syndicated facility extends…
  8. Q4 2012 Update – National Fuel Gas Co. – slide 8
    National Fuel Gas Company November 2012 Dividend Track Record 2.00 Dividend Consistency Consecutive Dividend Payments 110 Years Consecutive Dividend Increases 42 Years 1.50 Current Annualized Dividend Rate 1.46 per Share Annual…
  9. Q4 2012 Update – National Fuel Gas Co. – slide 9
    Midstream Businesses November 2012 Pipeline & Storage/NFG Midstream (1) Footnote 1 goes here (2) Footnote 2 goes here 10
  10. Q4 2012 Update – National Fuel Gas Co. – slide 10
    Midstream Businesses November 2012 Pipeline Expansions to Transport Appalachian Production Shipping Gas to Canada & Northeast Gathering Marcellus Production Line N Corridor Expansions (1) Footnote 1 goes here (2)…
  11. Q4 2012 Update – National Fuel Gas Co. – slide 11
    Midstream Businesses November 2012 A Closer Look at the Expansion Progress NORTHERN ACCESS EXPANSION (In-Service) TIOGA COUNTY EXTENSION (In-Service) CENTRAL TIOGA COUNTY EXTENSION (2015) MERCER EXPANSION PROJECT…
  12. Q4 2012 Update – National Fuel Gas Co. – slide 12
    Midstream Businesses November 2012 Pursuing Additional Opportunities Near the Line N Corridor Activity along the Pennsylvania/Ohio border continues to remain robust and is shifting north as the Utica begins to be delineated…
  13. Q4 2012 Update – National Fuel Gas Co. – slide 13
    NFG Midstream November 2012 Using a History of Excellence to Serve Appalachian Producers Midstreams gathering systems are critical to unlock remote, but highly productive Marcellus acreage History of operational success and…
  14. Q4 2012 Update – National Fuel Gas Co. – slide 14
    Utility November 2012 (1) Footnote 1 goes here (2) Footnote 2 goes here 15
  15. Q4 2012 Update – National Fuel Gas Co. – slide 15
    Utility November 2012 Providing Financial Stability Return on Equity 30.0% NY PA Allowed ROE - NY Approx. Settled ROE - PA 18.8% Return on Equity 20.0% 14.7% 13.2% 12.6% 12.5% 9.8% 10.6% 10.5% 10.0% 0.0% 2009…
  16. Q4 2012 Update – National Fuel Gas Co. – slide 16
    Utility November 2012 Continued Cost Control Helps Provide Earnings Stability Low natural gas prices, 250 combined with a focus on cost control, continue to 203 help reduce expenses 200 191 25 181 O&M Expense ( Millions)…
  17. Q4 2012 Update – National Fuel Gas Co. – slide 17
    Utility November 2012 Strong Commitment to Safety The anticipated increase in 2013 capital expenditures is largely due to the implementation of a new Customer Information System 80 Capital Expenditures for Safety Total Capital…
  18. Q4 2012 Update – National Fuel Gas Co. – slide 18
    Exploration & Production November 2012 19
  19. Q4 2012 Update – National Fuel Gas Co. – slide 19
    Seneca Resources November 2012 Remaining Strategically Opportunistic in Fiscal 2013 Marcellus Maintain two rigs drilling in the Eastern Development Area (EDA), largely in DCNR Tract 100 in Lycoming County, Pennsylvania Shale…
  20. Q4 2012 Update – National Fuel Gas Co. – slide 20
    Seneca Resources November 2012 Another Strong Year of Reserve Growth 1500 3-Year Natural Gas (Bcf) Fiscal F&D Cost(1) Crude Oil (MMbbl) Years (/Mcfe) 1,246 2006-2008 7.63 1200 2007-2009 5.35 Total Proved Reserves (Bcfe)…
  21. Q4 2012 Update – National Fuel Gas Co. – slide 21
    Seneca Resources November 2012 Increased Oil Spending and Tempered Marcellus Spending 1,000 Gulf of Mexico (Divested in 2011) East Division (Appalachia) West Division (California/Kansas) Capital Expenditures ( Millions) 750…
  22. Q4 2012 Update – National Fuel Gas Co. – slide 22
    Seneca Resources November 2012 Production Still Growing 120 Gulf of Mexico (Divested in 2011) East Division (Appalachia) 95-107 West Division (California/Kansas) 90 83.4 Annual Production (Bcfe) 67.6 5.2 60 75-85 49.6…
  23. Q4 2012 Update – National Fuel Gas Co. – slide 23
    Seneca Resources November 2012 Continuing to Focus on Improving Its Cost Structure 4.50 Property, Franchise & Other Taxes Other O&M Expense General & Administrative Expense Even after the new Pennsylvania Impact Lease Operating…
  24. Q4 2012 Update – National Fuel Gas Co. – slide 24
    California November 2012 Stable Production and Increasing Cash Flows California 2011 Rank Company BOEPD 1 Occidental 164,796 2 Chevron 163,153 3 Aera (Shell/Exxon) 149,974 4 Plains Exploration 36,775 5 Venoco Inc. 18,988 6…
  25. Q4 2012 Update – National Fuel Gas Co. – slide 25
    California November 2012 Stable Production Fields East Coalinga Temblor Formation Primary North Lost Hills South Lost Hills 1,200 BOEPD 1,600 BOEPD Tulare & Etchegoin Formation Monterey Shale Primary & Steamflood Primary…
  26. Q4 2012 Update – National Fuel Gas Co. – slide 26
    California November 2012 Strong Margins Support Significant Free Cash Flow Fiscal Year 2012 Adjusted EBITDA per BOE Non-Steam Fuel LOE 9.09 Steam Fuel 2.82 Average Revenue In Fiscal 2012 G&A 2.74 85.16 per BOE Production &…
  27. Q4 2012 Update – National Fuel Gas Co. – slide 27
    Seneca Resources November 2012 California Recent Initiatives Driving Near-Term Growth Key Areas of Focus in 2013 Actual 1. North Midway Sunset Steaming Average Daily Net Production (BOE per Day) 10,000 Forecast 2. South…
  28. Q4 2012 Update – National Fuel Gas Co. – slide 28
    Seneca Resources November 2012 Midway Sunset South Activity Update 2012 Drill Program: 21 Wells / 3 Injectors Seneca 251U Extended 251 Pool to the West 2013 Drill Program: 17 - 23 Wells / 5 - 9 Injectors Seneca 232M Extended…
  29. Q4 2012 Update – National Fuel Gas Co. – slide 29
    Seneca Resources November 2012 Sespe Field 2011 & 2012 Drilling Programs and Results 2011 Sespe Wells (5) 2012 Sespe Wells (6) 1 Mile TG 53-29 2013 Sespe Wells (6) Completing 1st Oil 12/12 TG 562-29 FA 502-33 Completing…
  30. Q4 2012 Update – National Fuel Gas Co. – slide 30
    Seneca Resources November 2012 Monterey Shale Play Drilling/Drilled Planned Monterey Shale Play Belridge Field 5 AMIs across the field Seneca WI: 12.5% AMI Outlines Seneca NRI: 11.4% Producing (Gross): 65 BOEPD 5…
  31. Q4 2012 Update – National Fuel Gas Co. – slide 31
    Seneca Resources November 2012 Expansive Pennsylvania Acreage Position SRC Fee Acreage SRC Lease Acreage NFG Storage Acreage Western Development Area Eastern Development Area Net acreage: 720,000 acres Net Acreage: 55,000…
  32. Q4 2012 Update – National Fuel Gas Co. – slide 32
    Seneca Resources November 2012 Net Rig Count (Working Interest) 10 Seneca Operated - Delineation Seneca Operated - Development EOG Operated 8 Seneca anticipates 7.5 minimal joint venture activity in fiscal 2013 Net…
  33. Q4 2012 Update – National Fuel Gas Co. – slide 33
    Seneca Resources November 2012 Eastern Development Area (EDA) Results & Plan Forward Covington Fully Developed 47 Wells Drilled and Producing Gross Production: 75 MMcf per Day DCNR Tract 595 Gross Production: 70 MMcf per…
  34. Q4 2012 Update – National Fuel Gas Co. – slide 34
    Seneca Resources November 2012 Lycoming and Tioga Counties Are Highly Productive Areas EUR per Average 1,000 Producing Average Average Average EUR Average of Development Well IP Rate 7-Day 30-Day per Well Lateral Lateral Area…
  35. Q4 2012 Update – National Fuel Gas Co. – slide 35
    Seneca Resources November 2012 Ramping Marcellus Shale Production 250 WDA/Other EOG JV Lycoming Forecast Average Daily Net Production (MMcf per Day) 200 DCNR 595 Covington 150 100 50 0 36
  36. Q4 2012 Update – National Fuel Gas Co. – slide 36
    Seneca Resources November 2012 BTU Delineating the Western Development Area Contours Rich Valley (1 Well) Peak IP: 6.3 MMcf per Day Estimated EUR: 6.4 Bcf Owls Nest (2 Wells) Ridgway (1 Well) Church Run (1 Well) Currently…
  37. Q4 2012 Update – National Fuel Gas Co. – slide 37
    Seneca Resources November 2012 Utica Shale Activity Summary Mt. Jewett Vertical: Tested Dry Gas Permitted Well Horizontal: Completing Fall 2012 Drilled Well Completed Well Owls Nest Horizontal: FY2013 Rex 9.2 MMcfd Tionesta…
  38. Q4 2012 Update – National Fuel Gas Co. – slide 38
    Seneca Resources November 2012 Initial Entry into the Mississippian Lime Play in Kansas Total Net Acres: 9,300 100% working interest in 4,600 gross acres 25% net working interest in 18,500 gross acres 2013: Participate in 4 to…
  39. Q4 2012 Update – National Fuel Gas Co. – slide 39
    National Fuel Gas Company November 2012 Appendix (1) Footnote 1 goes here (2) Footnote 2 goes here 40
  40. Q4 2012 Update – National Fuel Gas Co. – slide 40
    National Fuel Gas Company November 2012 Fiscal Year 2013 Earnings Guidance Drivers 2013 Forecast GAAP Earnings per Share 2.65 - 2.95 Exploration & Production Drivers Total Production (Bcfe) 95 - 107 DD&A Expense 2.10 - 2.25…
  41. Q4 2012 Update – National Fuel Gas Co. – slide 41
    National Fuel Gas Company November 2012 Manageable Debt Maturity Schedule 600 The Company is planning a new long-term debt issuance in fiscal 2013, likely totaling 350 million, to refinance maturing long- 500 500 term and…
  42. Q4 2012 Update – National Fuel Gas Co. – slide 42
    National Fuel Gas Company November 2012 Targeted Capital Structure Debt Equity Utility 50% 50% Equity P&S 50% 50% 55% - 65% Debt 35% - 45% E&P 30% 70% All Other 40% 60% Capital Structure Long-Term Consolidated Targets…
  43. Q4 2012 Update – National Fuel Gas Co. – slide 43
    Pipeline & Storage / Midstream November 2012 Appendix (1) Footnote 1 goes here (2) Footnote 2 goes here 44
  44. Q4 2012 Update – National Fuel Gas Co. – slide 44
    Pipeline & Storage November 2012 Expansion Initiatives Capacity Est. Project Name In-Service Market Status (Dth/D) CapEx Lamont Compressor Station 40,000 6 MM 6/2010 Fully Subscribed Completed Lamont Phase II Project 50,000 8…
  45. Q4 2012 Update – National Fuel Gas Co. – slide 45
    Midstream Corporation November 2012 Expansion Initiatives Capacity Est. In-Service Project Name Market Comments (Mcf/D) CapEx Date Capacity Completed Flowing into TGP Multiple Available 300 Line. This includes 10 Phases -…
  46. Q4 2012 Update – National Fuel Gas Co. – slide 46
    Exploration & Production November 2012 Appendix 47
  47. Q4 2012 Update – National Fuel Gas Co. – slide 47
    National Fuel Gas Company November 2012 Hedge Positions and Strategy Seneca has hedged approximately 60% of its forecasted production for Fiscal 2013 Natural Gas Volume Average Hedge Volume Average Swaps (Bcf) Price Oil Swaps…
  48. Q4 2012 Update – National Fuel Gas Co. – slide 48
    Marcellus Shale November 2012 Targeting Continued Cost Reductions Drilling Cost per Lateral Foot Completion Cost per Stage (000) WDA/DCNR 595 DCNR 100 WDA/DCNR 595 DCNR 100 800 400 700 350 600 300 500 250 674 650…
  49. Q4 2012 Update – National Fuel Gas Co. – slide 49
    Marcellus Shale November 2012 Water Management Program Water Sourcing: Coal mine runoff Permitted freshwater sources Recycled water Water Management: Instituted a Zero Surface Discharge policy Recycle Marcellus flowback and…
  50. Q4 2012 Update – National Fuel Gas Co. – slide 50
    National Fuel Gas Company November 2012 Comparable GAAP Financial Measure Slides and Reconciliations This presentation contains certain non-GAAP financial measures. For pages that contain non-GAAP financial measures, pages…
  51. Q4 2012 Update – National Fuel Gas Co. – slide 51
    November 2012 Reconciliation of Segment Capital Expenditures to Consolidated Capital Expenditures ( Thousands) FY 2013 FY 2009 FY 2010 FY 2011 FY 2012 Forecast Capital Expenditures from Continuing Operations Exploration &…
  52. Q4 2012 Update – National Fuel Gas Co. – slide 52
    November 2012 Reconciliation of Exploration & Production West Division Adjusted EBITDA to Exploration & Production Segment Net Income ( Thousands) 12 Months Ended September 30, 2012 Exploration & Production - West Division…
  53. Q4 2012 Update – National Fuel Gas Co. – slide 53
    November 2012 Reconciliation of Adjusted EBITDA to Consolidated Net Income ( Thousands) FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 Exploration & Production - West Division Adjusted EBITDA 188,008 170,611 187,838 187,603 226,897…

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