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JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company

Matador Resources Company · Jun 11, 2015 · 60 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. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 1
    Investor Presentation June 2015 NYSE: MTDR
  2. JUNE 2015 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. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 3
    Company Overview Exchange: Ticker NYSE: MTDR Shares Outstanding(1) 85.4 million common shares Share Price(2) 27.85/share Market Capitalization(1)(2) 2.4 billion 2014 Actual 2015 Guidance % Change Capital Spending 610 million…
  4. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 4
    Matador Resources Company Operations Overview Market Capitalization(1) 2.4 billion Avg. Daily Production Q1 2015(2) 23,513 BOE/d +98%** 38% of total production Almost no oil Oil (% total) 11,206 Bbl/d (48%) 72% of total natural…
  5. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 5
    Matadors Execution History Doing What We Say Matador continues to execute on its core strategy of acquiring great assets, developing a highly professional, committed workforce, maintaining a strong balance sheet and generating…
  6. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 6
    Oil and Natural Gas Proved Reserves and PV-10(1) Growth By Area Permian Permian 377.7 million, 35% 246.2 million, 24% Permian 31.9 million, 5% Haynesville/CV 82.9 million, 13% Haynesville/CV Haynesville/CV 153.0 million,…
  7. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 7
    Financial Strategy Be prudent with our investors capital Reduced drilling program from 5 rigs at YE2014 to 2 rigs currently due to lower commodity prices, with primary focus on Permian (Delaware) Basin 2015E CapEx highest in Q1 2015…
  8. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 8
    Matadors Continued Production Growth Average Daily Oil Production Average Daily Natural Gas Production (Bbl/d) 11,206 (MMcf/d) 73.8 9,095 5,843 39.8 41.9 34.1 35.4 3,317 23.0 91 422 2010 2011 2012 2013 2014 Q1 2015 2010…
  9. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 9
    Matador Has Experienced Strong Reserves and Adjusted EBITDA(1) Growth in Recent Years Growth in PV-10(2) Over Last 5 Years PV-10(2) per Share 1,200 ( per share) 14.86 SEC Pricing 91.48 oil 1,100 4.35 gas Oil, /Bbl 1,000 Gas,…
  10. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 10
    Previous Oil Price Declines Have Created Opportunities for Matador(1) Comparison of Major Oil Corrections and Major Matador Turning Points Since 1980 Length of Oil Price % Increase in Oil % Change in Decline Price Date Event Oil…
  11. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 11
    Keys to Matadors Success Over Last 35 Years(1) 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 processes Board and…
  12. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 12
    Delaware Basin A World Class Hydrocarbon System West East DELAWARE BASIN CENTRAL BASIN MIDLAND BASIN PLATFORM 23,000 Wolfcamp Sediment Fill Simpson Source Kitchens Now Unconventional Resource Plays 70,000 square mile…
  13. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 13
    Permian Basin Acreage Position and Recent Test Results Successful performance of initial horizontal wells(1) Cumulative Production Recent Production TWIN LAKES Oil Eq. % Oil Natural Gas EUR(2) 42,858 gross / 30,035 net acres Well…
  14. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 14
    4,000 feet of Hydrocarbon Column Creates Opportunity Determining Good, Better, Best important as potential INTER-Formational Stacked Pay exceeds inter-formational stacked pay GR RES Bone Spring Lime 2015 program will expand on…
  15. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 15
    Matador is a Significant Delaware Basin Player Matadors 88,500 net acres place it among the largest operators in the Delaware Basin Matador holds largest Delaware Basin acreage position among small and mid-cap publicly traded energy…
  16. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 16
    Matadors Acreage Among Other Significant Delaware Basin Activity Northern Delaware (HEYCO and Ranger Prospect Areas) Lea/Eddy Counties, NM Other Operators Eddy Lea NW Shelf Concho EOG Chevron Concho Devon Mewbourne…
  17. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 17
    2015 Permian Basin Drilling Plan 36 gross (23.7 net) wells planned in 2015 - TWIN LAKES 42,858 gross / 30,035 net acres 2015 Permian Basin Program 33 gross (21.0 net) wells turned to sales Estimated capital expenditures of 245…
  18. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 18
    Wolf Inventory Multi-Pay Development Potential Development Well D&C(1) CapEx EUR(2) (MBOE) Bone Spring 7 8 million 450 600 Wolfcamp 8 9 million 650 1,100 Full Development Spacing Pattern (Cross-Section View) Gross Wells 1…
  19. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 19
    Wolf Area Wolfcamp A/X Wells Performing Above Expectations 10000 Dorothy White 1H has produced 358,000 BOE (67% oil) in 15.5 months X Norton Schaub 1H has produced 180,400 BOE (70% oil) in 9.5 months X Johnson 4402SB53 204H has…
  20. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 20
    Rustler Breaks Inventory Multi-Pay Development Inventory Development Well D&C(1) CapEx EUR(2) (MBOE) Bone Spring 5.25 6.25 million 350 650 Wolfcamp 7 8 million 600 1,000 Full Development Spacing Pattern (Cross-Section View) Gross…
  21. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 21
    Rustler Breaks Wolfcamp B Wells Performing Above Expectations 10000 Rustler Breaks 1224S27E RB 224H(1) has produced 170,000 BOE (42% oil) in 12 months Tiger 1424S28E RB 224H has produced 48,000 BOE (45% oil) in 1 month Wolfcamp B…
  22. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 22
    Rustler Breaks Wolfcamp A Well Off to Strong Start 10000 Guitar 1024S28E RB 202H has produced 38,300 BOE (78% oil) in 1.5 months Wolfcamp A/XY horizontal in Rustler Breaks Area Eddy County, NM Production Rate, BOE/day 1000…
  23. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 23
    Ranger Inventory Multi-Well Development Potential Development Well D&C(1) CapEx EUR(2) (MBOE) Bone Spring 5.5 6.5 million 400 600 Wolfcamp 8 9 million 200 800* * Based on Volumetrics and 4-8% Recovery Factor Full Development…
  24. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 24
    Ranger Area Second Bone Spring Wells Performing Above Expectations 10,000 Ranger State 3320S35E RN 121H(1) has produced 199,000 BOE (91% oil) in 18 months Pickard State 2018S34E RN 121H(2) has produced 106,000 BOE (93% oil) in 10…
  25. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 25
    Significant Delaware Basin Inventory Matador has identified 1,445 gross (960 net) locations(1) TWIN LAKES Chaves This inventory does not yet include the HEYCO properties or Twin Lakes locations RUSTLER BREAKS Formation Gross…
  26. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 26
    Permian Basin Economics Oil Price Sensitivities Ranger 33 400 700 MBOE ROR vs Oil Price Dorothy White 700 1,000 MBOE ROR vs Oil Price 300 120 700 MBOE, 7.5 MM D&C 1,000 MBOE, 9.6 MM D&C 110 700 MBOE, 6 MM D&C 1,000 MBOE, 8 MM D&C…
  27. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 27
    Latest Technology: Simultaneous Operations (Sim-Ops) Capable Rigs Conventional Drilling Configuration Sim-Ops Capable with V-door turned 90 Drilling rig must leave location Space available for frac prior to frac operations…
  28. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 28
    New Rig Improvements 7,500 psi Pressure Rating Estimated reduction in drilling time of 15 to 20% in the lateral on Wolfcamp wells Telescoping Flex-joint Estimated reduction in drilling time of 12 to 18 hours per well Integrated…
  29. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 29
    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…
  30. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 30
    Total Prospective Equivalent Oil Price Uplifts 80.00 H2O Equivalent Rig Recycle Realization Drilling Improvements 3.00 0.90 74.00 70.00 Midstream Spread Rate 3.00 SWD 4.50 Frac 60.00 Savings 5.10 7.50 50.00 50.00 WTI Oil…
  31. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 31
    Evolution of Permian Basin Frac Design Reservoir Specific Bone Spring 375 ft. Gen 1 Gen 2 75 ft. 2,000 lbs/ft 1,333 lbs/ft Coupled 500 Mlbs 40 Bbl/ft 20 Bbl/ft 7,500 Bbl 50 cluster spacing 75 cluster spacing Upper…
  32. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 32
    Longwood Gathering and Disposal Systems(1) in Delaware Basin Longwood Gathering and Disposal Systems Activities Loving County, Texas Natural gas gathering and compression Water gathering Salt water disposal Oil gathering Cryogenic…
  33. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 33
    Midstream Initiatives Growing into Respectable Stand-Alone Business Expect to spend 38 million on midstream initiatives in the Permian Basin in 2015 Matador expects Longwood to be able to support its own sources of financing…
  34. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 34
    Loving County, Texas Biggest Midstream Project to Date Natural gas gathering and compression Cryogenic natural gas processing plant Water gathering Salt water disposal Oil gathering SWD = Salt Water Disposal 38
  35. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 35
    Eagle Ford Overview EAGLE FORD EAST Nickel EAGLE FORD ACREAGE TOTALS 3,700 gross / 2,900 net acres Ranch 39,835 gross / 29,702 net acres Measured Depth: 17,000 18,000 Hennig Well Costs: 7.5-9.5 million 2015 CapEx 90 million…
  36. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 36
    Eagle Ford 2014 Accomplishments Increased net oil production rate by 44% from 6,400 Bbl/d in Q4 2013 to 9,100 Bbl/d in Q4 2014 Added 2,900 net acres, more than replacing 2014 Eagle Ford drilled inventory of 36 net wells (See chart…
  37. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 37
    Evolution of Matador Eagle Ford Frac Design Gen 2 Gen 3 Gen 4 Gen 5 Gen 6 Gen 7 Proppant 650 Mlbs 650 Mlbs Pumped(1) 515 Mlbs 500 Mlbs 375 Mlbs 405 Mlbs Fluid Volume Pumped 9,550 Bbl 11,750 Bbl 11,750 Bbl 11,750 Bbl 5,770 Bbl…
  38. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 38
    Haynesville Chesapeake Elm Grove Operations Successful 2014 non-op drilling program, primarily by Chesapeake at Elm Grove 17 gross (3.8 net) wells with estimated recoveries of 8 to 12 Bcf and well costs of 7 to 8 million (below…
  39. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 39
    Economics of Tier 1 Wells (10 Bcf) Haynesville at Elm Grove 500 Matadors Advantaged Economics NRIs of 85% to 90% on many properties due to ORRIs 450 Improved pricing/differentials of 0.70/MMBtu due to taking gas in kind Longer…
  40. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 40
    2015 Capital Investment Plan Reduced Drilling Program in 2015 Reduced drilling program from 5 rigs to 2 rigs due to lower commodity prices, with primary focus on Permian (Delaware) Basin Currently operating 2 rigs both in the…
  41. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 41
    2015 Capital Investment Plan Summary 2015E CapEx of 350 million 2015E CapEx by Expense Type Decrease of 43% from 2014 CapEx of 610 million Facilities, Infrastructure, Etc. Estimated service cost reductions of 15 to 20% as observed…
  42. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 42
    Commodity Price and CapEx Estimates Significantly Impact Forecasts Sensitivity of 2015E Adjusted EBITDA(1) to Oil Price Relatively small improvements in oil price and cost reductions can significantly improve financial forecasts and…
  43. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 43
    2015 Production Estimates Oil Equivalent Growth of 43% 2015E Oil Production Oil Production Growth (Bbl/d) 14,000 Estimated oil production of 4.1 to 4.3 million barrels 11,507 12,000 27% increase from 2014 despite decreased drilling…
  44. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 44
    2015 Financial Estimates Oil and Natural Gas Revenues(2) (millions) 2015E Revenues and Adjusted EBITDA(1)(2) Realized Oil and Natural Gas Prices, /Bbl and /Mcf Revenues and Adjusted EBITDA(1)(2) growth significantly impacted 76.39…
  45. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 45
    Summary and 2015 Guidance Moving from 5 rigs to 2 rigs in 2015; currently operating 2 rigs in Delaware Basin Possible addition of a third drilling rig in the Permian Basin as early as late summer 2015(1) Permian drilling focused on…
  46. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 46
    Hedging Profile 2015 Hedges(1) Oil Hedges: 1.9 million barrels of oil hedged for remainder of 2015 at weighted average floor and ceiling prices of 67/Bbl and 85/Bbl, respectively Approximately 80% of oil hedged for remainder of…
  47. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 47
    Credit Agreement Status Strong, supportive bank group led by Royal Bank of Canada Borrowing base at 375 million based on December 31, 2014 reserves Bank group affirmed 375 million conforming borrowing base in April 2015 Retained full…
  48. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 48
    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…
  49. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 49
    Understanding the Petroleum Systems for Maximum Oil Recovery Rock Mechanics and Completion Strategy Varies Conventional Unconventional Decoupled Coupled Micro-Coupled In-Situ Source Rock and Reservoir Bone Spring Bone Spring…
  50. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 50
    Delaware Basin Combination Attributes Concho CTA State Com 4H: 1,063 BOE per day 830 Bbl oil + 1.4 MMcf natural gas per day (first 30 days) TWIN LAKES Concho CTA State Com 3H: 992 BOE per day 830 Bbl oil + 1.0 MMcf natural gas per…
  51. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 51
    Combination Acreage a Strategic Fit CTA State Com 3H - IP(30): 992 BOE/d (84% Oil) - 37.6 MBO Cum to date (46 days) CTA State Com 1 Type Log CTA State Com 4H - IP(30): 1,063 BOE/d (78% Oil) - 26.3 MBO Cum to date (33…
  52. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 52
    North Ranger-Twin Lakes Area Pennsylvanian/Wolfcamp Production Distribution Townsend Field 166 wells A 25 million Bbl, 49 Bcf Kemnitz Field 94 wells 19 million Bbl, 78 Bcf Sanmal and Leamex Fields Wolfcamp/ 40 wells Upper…
  53. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 53
    Pennsylvanian/Wolfcamp Hybrid Production Target Interval 30025416140000 30025300490000 30025257790000 30025346940000 30025397370000 30025414070000 Pickard 2H MATADOR PRODUCTION A North AVRA OIL COMPANY ELK OIL COMPANY Legacy Reserves…
  54. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 54
    WTI Oil Price and Service Prices Frac Index Price reductions of 31% ...equivalent to a 7.50/Bbl uplift in oil prices /Bbl Drilling Spread Rate reductions of 18% ...equivalent to a 4.50/Bbl uplift in oil prices Note: Frac…
  55. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 55
    Infrastructure Development Saltwater disposal savings Oil pipeline fee reduction 1.30/Bbl of produced water ...equivalent to a 5.10/Bbl uplift in oil prices ...an uplift of 0.90/Bbl in oil prices 66
  56. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 56
    Potential Water Recycling Savings for Loving County Potential savings of up to 600,000 per well ...equivalent to a 3.00/Bbl uplift in oil prices Produced Purchase Water Frac Water Recycling Frac Additives Saltwater…
  57. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 57
    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…
  58. JUNE 2015 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. JUNE 2015 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,…
  60. JUNE 2015 INVESTOR PRESENTATION – Matador Resources Company – slide 60
    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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