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November 2014 Investor Presentation – Matador Resources Company

Matador Resources Company · Nov 7, 2014 · 59 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. November 2014 Investor Presentation – Matador Resources Company – slide 1
    Investor Presentation November 2014 NYSE: MTDR
  2. November 2014 Investor Presentation – Matador Resources Company – slide 2
    Matador History Predecessor Entities Foran Oil & Matador Petroleum Founded by Joe Foran in 1983 most participants are still shareholders today Foran Oil funded with 270,000 in contributed capital from 17 friends and family members…
  3. November 2014 Investor Presentation – Matador Resources Company – slide 3
    Company Overview Exchange: Ticker NYSE: MTDR Shares Outstanding(1) 73.4 million common shares Share Price(2) 24.03/share Market Capitalization(1)(2) 1.8 billion 2012 Actual 2013 Actual 2014 Guidance(3) Capital Spending 335…
  4. November 2014 Investor Presentation – Matador Resources Company – slide 4
    Matadors Execution History Doing What We Say Matador continues to execute on its core strategy of acquiring great assets, retaining a best-in-class workforce, maintaining a strong balance sheet and generating significant shareholder…
  5. November 2014 Investor Presentation – Matador Resources Company – slide 5
    Delivering Strong Results Q3 2014 Achievements 2014 Capital Budget and Guidance Oil Production Company Record 570 million capital budget for 2014 9,123 Bbl/d; 36% growth versus Q3 2013 Adjusted EBITDA(1) of 270 to 290 million Oil &…
  6. November 2014 Investor Presentation – Matador Resources Company – slide 6
    Matador Resources Company Overview Market Capitalization(1) 1.8 billion Average Daily Production(2) 21,800 BOE/d Oil (% total) 12,100 Bbl/d (56%) Natural Gas (% total) 57.8 MMcf/d (44%) Proved Reserves 9/30/14 61.0 million BOE %…
  7. November 2014 Investor Presentation – Matador Resources Company – slide 7
    Asset Highlights Permian Basin Eagle Ford Shale Haynesville Shale Exploratory and Delineation Program Development Program Natural Gas Bank Currently running a two-rig drilling Currently running a two walking rig 25,000 net acres in…
  8. November 2014 Investor Presentation – Matador Resources Company – slide 8
    Keys to Matadors Success People We have a strong, committed technical and financial team in place, and we continue to make additions and improvements to our staff, our capabilities and our process Board and Special Advisor additions…
  9. November 2014 Investor Presentation – Matador Resources Company – slide 9
    2014 South Texas Plan Details 2014 projected capital expenditures of 318 million or 56% of total 2-rig program with almost all of the 2014 South Texas capital budget directed to the Eagle Ford shale Drill and/or complete or…
  10. November 2014 Investor Presentation – Matador Resources Company – slide 10
    Eagle Ford Overview Operations Summary 107 gross (89.1 net) wells(1) producing from the Eagle Ford Proved Reserves 9/30/14 22.5 million BOE An increase in oil production from 330 Bbl/d(2) in % Proved Developed 62% 2011 to 7,600…
  11. November 2014 Investor Presentation – Matador Resources Company – slide 11
    Eagle Ford Measured Depths and Well Costs EAGLE FORD ACREAGE TOTALS EAGLE FORD EAST Nickel Ranch 39,243 gross / 29,165 net acres Measured Depth: 17,000 18,000 Hennig Well Costs: 8-10 million 80-acre spacing Uvalde Medina Gonzales…
  12. November 2014 Investor Presentation – Matador Resources Company – slide 12
    Operational Improvements (Normalized) Overview Eagle Ford Drilling Costs / Drilled Foot(1) West Central East Over the past two years, made significant progress and increased 271 258 260 knowledge of how to drill, complete 242 and…
  13. November 2014 Investor Presentation – Matador Resources Company – slide 13
    Evolution of Matador Eagle Ford Frac Design Gen 2 Gen 3 Gen 4 Gen 5 Gen 6 650 Mlbs 515 Mlbs Proppant 500 Mlbs 405 Mlbs Pumped(1) 375 Mlbs Fluid Volume 11,750 Bbl 11,750 Bbl Pumped 7,825 Bbl 9,550 Bbl 5,770 Bbl 300 ft.…
  14. November 2014 Investor Presentation – Matador Resources Company – slide 14
    Frac Generation and Downspacing Comparison 120,000 120,000 GEN 2 (80 Acre) GEN 2 (80 Acre) GEN 35 (80 (40 Acre) GEN 53 (40 (80 Acre) 100,000 100,000 GEN 64 (40 (80 Acre) GEN 365 (80 (40 Acre) GEN 35 (80 (40 Acre) GEN 6 (40…
  15. November 2014 Investor Presentation – Matador Resources Company – slide 15
    Improvement in Drilling Efficiency Moving Towards Batch Drilling Single Well Drilling PAD Drilling BATCH Drilling EXPLORATION 2010 1/3 RIG 60 to 70% increase 2011 2/3 RIG in Rig Efficiency from 2012 to 2014E 2012 2 RIGS 2013 1…
  16. November 2014 Investor Presentation – Matador Resources Company – slide 16
    Compressing Drill Times Improving rig fleet High tech, fast moving, faster drilling, walking style rigs Improving Rate of Penetration (ROP) Bit selection and development Bottom Hole Assembly (BHA) selection Rotary steerable…
  17. November 2014 Investor Presentation – Matador Resources Company – slide 17
    Progression of Drilling Rig Technology from 2010 to 2014 Advancing Rig Technology HYDRAULIC CATWALK AC DRIVE ROUND 1600 HP INTEGRATED APEX RIG BOP WALKING RIG ELECTRIC SYSTEM BOTTOM MUD PUMPS TOP DRIVE (FAST MOVE) HANDLER…
  18. November 2014 Investor Presentation – Matador Resources Company – slide 18
    Artificial Lift Reducing Natural Production Declines Flowing Rod Pumping Gas Lifting Benefits of Gas Lift Accelerates production Accelerated Production Reduces LOE 300 Bbl/d Lower maintenance Helps wells recover faster from…
  19. November 2014 Investor Presentation – Matador Resources Company – slide 19
    Buda Wells Activity Since January 1, 2010 Potential Test TX American Blackbrush O&G Resources 10 Buda Completions Buchanan-1H May 2011 May 2014 5/3/2013 Cum: 250 MBbl Blackbrush O&G 14 mo avg: 1.4 Bcf Oppenheimer-101H 285 Bbl/d…
  20. November 2014 Investor Presentation – Matador Resources Company – slide 20
    2014 Permian Basin Plan Details 2014 projected capital expenditures of 190 million or 33% of total Continue 2-rig program working in Lea and Eddy Counties, NM and Loving County, TX Drill and/or complete or participate in 14 gross…
  21. November 2014 Investor Presentation – Matador Resources Company – slide 21
    Permian Basin TWIN LAKES Permian Basin Total 38,982 gross / 27,456 net acres Gross Acres 98,440 acres Net Acres 64,982 acres INDIAN DRAW / RUSTLER BREAKS 21,023 gross / 14,785 net acres Successful performance of initial horizontal…
  22. November 2014 Investor Presentation – Matador Resources Company – slide 22
    Technology Transfer and Application from Eagle Ford to Permian New rigs arriving in 2015 have even more advanced technology than current Eagle Ford rigs Walking packages, hydraulic catwalks, reconfiguration of rig layouts, high pressure…
  23. November 2014 Investor Presentation – Matador Resources Company – slide 23
    Permian Basin Petroleum Systems and the Wolfcamp Kitchens West East DELAWARE BASIN CENTRAL BASIN MIDLAND BASIN PLATFORM 23,000 Wolfcamp Sediment Fill Simpson Source Kitchens Now Unconventional Resource Plays 70,000…
  24. November 2014 Investor Presentation – Matador Resources Company – slide 24
    Wolf-Bone Geological Setting, Predicting Where the Better Rocks Are 265 mya End of Bone Springs Warmer Delaware Basin Delaware Mountain Group San Andres 1st, 2nd, 3rd Bone Spring Sands Yeso Abo Sands confined to channels…
  25. November 2014 Investor Presentation – Matador Resources Company – slide 25
    Targeting Multiple Benches in Permian Appraisal Program GR RES Brushy Canyon Sand Bone Spring Lime Matador has successfully Upper Avalon Shale drilled Lower Avalon Shale horizontal wells targeting five First Bone Spring Sand…
  26. November 2014 Investor Presentation – Matador Resources Company – slide 26
    Wolf / Loving Prospect Area Johnson 44-02S-B53 204H Location of Matador wells Wolfcamp A IP: 1,286 BOE/d Dorothy White 1H 793 Bbl/d; 3.0 MMcf/d Loving Wolfcamp A 11,183 gross (7,155 net) acres 10 mo.cum: 246,000 BOE (67% oil)…
  27. November 2014 Investor Presentation – Matador Resources Company – slide 27
    Ranger / Querecho Plains Prospect Area Jim Rolfe 22-18-34 RN State 131Y 3rd Bone Spring Sand Flowing back after completion Location of Matador wells Pickard State 20-18-34 2H Wolfcamp D 3 mo.cum: 21,000 BOE (88% oil) Pickard State…
  28. November 2014 Investor Presentation – Matador Resources Company – slide 28
    Rustler Breaks / Indian Draw Prospect Area Rustler Breaks 12-24-27 1H Location of Matador wells Wolfcamp B 7 mo.cum: 111,000 BOE (45% oil) 21,023 gross (14,785 net) acres Mewbourne Oil Co. Layla 35 MD Fee 1H 108 gross (82.8 net)…
  29. November 2014 Investor Presentation – Matador Resources Company – slide 29
    Twin Lakes Prospect Area Saunders Denton Location of Matador well Penn/Perm Caudill Wolfcamp/Devonian 43 MMBbl, 62 Bcf Penn/Perm 157 MMBbl, 78 Bcf 8.1 MMBbl, 6.0 Bcf Dean Penn/Perm 9.5 MMBbl, 6.0 Bcf 38,982 gross (27,456 net)…
  30. November 2014 Investor Presentation – Matador Resources Company – slide 30
    North Ranger-Twin Lakes Area Pennsylvanian/Wolfcamp D Production Distribution Townsend Field 166 wells A 25 MMBbl, 49 Bcf Kemnitz Field 94 wells 19 MMBbl, 78 Bcf Sanmal and Leamex Fields Wolfcamp/ Kemnitz & Lea Fields 39 wells…
  31. November 2014 Investor Presentation – Matador Resources Company – slide 31
    Pennsylvanian/Wolfcamp D Hybrid Production Target Interval 30025300490000 30025257790000 30025019240000 30025397370000 30025414070000 30025416140000 AVRA OIL COMPANY ELK OIL COMPANY UNION OIL CML EXPLORATION CML EXPLORATION Pickard 2H…
  32. November 2014 Investor Presentation – Matador Resources Company – slide 32
    Matador Permian Basin First Generation Frac Designs Bone Spring Wolfcamp 550 Mlbs 600 Mlbs Proppant Pumped(1) Fluid Volume 11,750 Bbl 11,750 Bbl Pumped 300 ft. Geometry of the Frac 0 ft. Note: Figure depicts…
  33. November 2014 Investor Presentation – Matador Resources Company – slide 33
    2014 Tier 1 Haynesville Shale Plan 2014 projected capital expenditures of 62 million or about 11% of total Estimated participation in up to 56 gross (7.8 net) non-operated wells Chesapeake in the process of drilling up to 45 gross…
  34. November 2014 Investor Presentation – Matador Resources Company – slide 34
    Significant Option Value on Natural Gas Elm Grove Area TIER 3: 2 4 Bcf NW Louisiana / East Texas(1) BOSSIER TIER 2: 4 6 Bcf Proved Reserves(2) 183.6 Bcfe CADDO 3,600 BOE/d BIENVILLE Daily Production(3) (99% natural gas) TIER 1: 6…
  35. November 2014 Investor Presentation – Matador Resources Company – slide 35
    Anticipated Chesapeake Elm Grove Haynesville Operations 2014 Through Early 2016 MTDR anticipates 45-well program through Currently early 2016 producing Three walking rigs actively drilling in third quarter 2014 MTDR in…
  36. November 2014 Investor Presentation – Matador Resources Company – slide 36
    Elm Grove Tier 1 Haynesville Chesapeake Operated 300 275 10 Bcf - 7.0mm D&C Cost 250 10 Bcf - 8.0mm D&C Cost 225 10 Bcf - 9.0mm D&C Cost Estimated Rate of Return, % 200 175 150 125 100 75 Matadors Advantaged…
  37. November 2014 Investor Presentation – Matador Resources Company – slide 37
    Summary and 2014 Guidance Continue 4-rig program full-time in Q4 2014 2 rigs in the Eagle Ford and 2 rigs in the Permian Eagle Ford development continues to be the major driver of our growth in 2014 Permian drilling program designed…
  38. November 2014 Investor Presentation – Matador Resources Company – slide 38
    2014 Capital Investment Plan Summary Continue 4-rig program full time in Q4 2014: 2 rigs in the Eagle Ford and 2 rigs in the Permian 2014E capital expenditures of 570 million Eagle Ford development continues to be the major driver…
  39. November 2014 Investor Presentation – Matador Resources Company – slide 39
    Funding for 2014 Capital Investment Plan Anticipate funding remaining 2014 capital expenditures through operating cash flows and borrowings under revolving credit facility 0.4 million barrels of oil hedged for remainder of 2014,…
  40. November 2014 Investor Presentation – Matador Resources Company – slide 40
    Investment Highlights Strong Growth Profile YE2011 to 2014E oil production CAGR of 178%(1) with expected year-over-year growth of 55%(1) in 2014 with Increasing Focus on Oil / Liquids 89% of 2014E CapEx program focused on oil /…
  41. November 2014 Investor Presentation – Matador Resources Company – slide 41
    Oil Production and Revenues Through Q3 2014 Average Daily Oil Production Average Daily Natural Gas Production (Bbl/d) (MMcf/d) 12,000 70.0 All-time high oil production in Q3 2014 CHK Haynesville wells starting to impact 60.0 10,000…
  42. November 2014 Investor Presentation – Matador Resources Company – slide 42
    Quarterly Performance Metrics Through Q3 2014 Average Daily Equivalent Production Oil and Natural Gas Revenues (BOE/d) ( in mm) 18,000 120.0 15-20% shut-in at times during Q3 2014 15,424 16,096 Q3 2014 slightly lower due to 16,000…
  43. November 2014 Investor Presentation – Matador Resources Company – slide 43
    Quarterly Expense Metrics Through Q3 2014 Production Taxes and Marketing Lease Operating (per BOE) (per BOE) 8.00 14.00 Reflects growth in oil production / revenues Mostly flat Q/Q 11.17 11.11 6.50 10.53 7.00 12.00…
  44. November 2014 Investor Presentation – Matador Resources Company – slide 44
    Matador Provides Growth on a Per Share(1) Basis PV-10(2) per Share Adjusted EBITDA(3)(4) per Share ( per share) ( per share) 11.15 3.99 7.84 3.26 5.82 2.15 2.92 1.17 1.75 0.58 0.38 2009 2010 2011 2012 2013 2009 2010…
  45. November 2014 Investor Presentation – Matador Resources Company – slide 45
    Matadors Continued Growth Average Daily Production Oil Production Mix (MBOE/d) (% of Average Daily Production) 11.7 50% 9.0 37% 7.0 3.9 2.3 1.5 7% 6% 4% 2% 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013…
  46. November 2014 Investor Presentation – Matador Resources Company – slide 46
    Semi-Annual Performance Metrics Through 2014 Oil Production Oil Equivalent Production (Bbl in thousands) (BOE in thousands) 1,837 3,525 1,463 1,225 2,475 2,341 1,944 908 1,768 729 1,525 1,277 485 84 (2) (3) 2H 2011…
  47. November 2014 Investor Presentation – Matador Resources Company – slide 47
    Semi-Annual Performance Metrics and Hypothetical 2015 Stress Case Scenario For 2015, assumes: Oil at 80 per Bbl; 570mm CapEx; Rigs: 1 Eagle Ford + 4 Permian + Non-Op Haynesvi lle Oil Production Total Oil and Natural Gas Production (Bbl…
  48. November 2014 Investor Presentation – Matador Resources Company – slide 48
    Hedging Profile Hedges in Place for Remainder of 2014 and 2015 At November 5, 2014, Matador had: Oil Hedges (Costless Collars) 2014 2015 0.4 million barrels of oil hedged for Total Volume Hedged by Ceiling 442,400 Bbl 1,680,000 Bbl…
  49. November 2014 Investor Presentation – Matador Resources Company – slide 49
    Credit Agreement Status Strong, supportive bank group led by Royal Bank of Canada Borrowing base at 450 million, based on July 31, 2014 reserves, increased from 385 million based on December 31, 2013 reserves, and increased from 125…
  50. November 2014 Investor Presentation – Matador Resources Company – slide 50
    SEC Proved Reserves Value Growth By Area Haynesville/CV Permian Haynesville/CV 168.7 million, 18% 168.6 million, 18% 82.9 million, 13% Permian 31.9 million, 5% Haynesville/CV Permian 55.2 million, 10% 4.1 million, 1% Eagle…
  51. November 2014 Investor Presentation – Matador Resources Company – slide 51
    Board of Directors and Special Advisors Expertise and Stewardship Board Members Professional Experience Business Expertise David M. Laney - Past Chairman, Amtrak Board of Directors Law and Investments Lead Director - Former Partner,…
  52. November 2014 Investor Presentation – Matador Resources Company – slide 52
    Proven Management Team Experienced Leadership Industry Matador Management Team Background and Prior Affiliations Experience Experience Joseph Wm. Foran - Matador Petroleum Corporation, Foran Oil Company and James Cleo 34 years Since…
  53. November 2014 Investor Presentation – Matador Resources Company – slide 53
    MTDR Trading versus BOE/d Production since IPO October 2014 averaged 21,800 BOE/d 32.00 22,000 20,000 28.00 18,000 24.00 Daily Oil Equivalent Production, BOE/d 16,000 20.00 14,000 MTDR Closing Price 12,000…
  54. November 2014 Investor Presentation – Matador Resources Company – slide 54
    MTDR Trading versus Growing Permian Acreage since IPO 32.00 70,000 28.00 60,000 24.00 Permian Acreage Position, Net Acres 50,000 20.00 MTDR Closing Price 40,000 16.00 30,000 12.00 20,000 8.00 10,000…
  55. November 2014 Investor Presentation – Matador Resources Company – slide 55
    MTDR Trading versus PV-10 Growth since IPO 32.00 1,000.0 900.0 28.00 800.0 24.00 700.0 20.00 MTDR Closing Price PV-10, in millions 600.0 16.00 500.0 400.0 12.00 300.0 8.00 200.0 4.00 100.0 0.00 0.0…
  56. November 2014 Investor Presentation – Matador Resources Company – slide 56
    PV-10 Reconciliation PV-10 is a non-GAAP financial measure and generally differs from Standardized Measure, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future net…
  57. November 2014 Investor Presentation – Matador Resources Company – slide 57
    Adjusted EBITDA Reconciliation The following table presents our calculation of Adjusted EBITDA and reconciliation of Adjusted EBITDA to the GAAP financial measures of net income (loss) and net cash provided by operating activities,…
  58. November 2014 Investor Presentation – Matador Resources Company – slide 58
    Adjusted EBITDA Reconciliation The following table presents our calculation of Adjusted EBITDA and reconciliation of Adjusted EBITDA to the GAAP financial measures of net income (loss) and net cash provided by operating activities,…
  59. November 2014 Investor Presentation – Matador Resources Company – slide 59
    Adjusted EBITDA Reconciliation The following table presents our calculation of Adjusted EBITDA and reconciliation of Adjusted EBITDA to the GAAP financial measures of net income (loss) and net cash provided by operating activities,…

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