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NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co.

Cimarex Energy Co. · Nov 5, 2014 · 30 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 CORPORATE UPDATE – Cimarex Energy Co. – slide 1
    Corporate Update November 2014 1
  2. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 2
    Corporate Profile 87.4 MM Proved reserves3.... 2.5 Tcfe Shares outstanding.. Market cap1......... 9.6 B % Natural gas.. 52% Long-term debt 2........ 1.5 B % Proved developed... 80% Enterprise value..... 11.1 B R/P…
  3. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 3
    Whats New +25% Daily Production 864870 Expect 2014 production to (MMcfe) grow 25% (midpoint) CanaWoodford production up 31% sequentially 2014 E&D Capex of 1.95bn up 25% yoy Closed 238mm Mid Continent acquisition 350 Announced…
  4. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 4
    Production Profile 3Q 2014 Production Mix Revenue Contribution Oil 27% Natural Gas 50% NGL 23% 942MMcfe per day; up 31% yearoveryear Gas grew 35%, oil up 10% and NGL increased 59% Production driving earnings & cash…
  5. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 5
    2014 Capital Investment Plan Total Capital: 1.95 billion By Region: Facilities & Land, Seismic Other & Cap. 6% Overhead 14% Drilling 80% Robust Permian opportunity set commands 74% of capex Oil production growth of 16%…
  6. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 6
    Permian Basin Region Delaware Basin focus 90+ industry rigs working 18 Cimarexoperated rigs Multiple projects targeting multiple zones Avalon Shale (oil window) Bone Spring sands (oil) Wolfcamp shale (oil & gas) 7
  7. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 7
    2014 Permian Drilling Capital Total Permian Wolfcamp 1.2 billion 650 million Other 25 Midland Avalon 160 6% Ward 14% Wolfcamp 650 Reeves 53% Bone Spring Culberson 360 27% Severe weather caused completion delays in…
  8. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 8
    Delaware Basin Bone Spring Activity Spend 360mm in 2014 to drill 86 gross (50 net) wells 60 gross (32 net) wells YTD Three areas New Mexico 2nd & 3rd Bone Spring (Eddy & Lea Counties) . 23 operated wells YTD 30day average peak…
  9. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 9
    Delaware Basin Avalon Shale Seven wells completed to date 30day average peak IP of 909 BOE/d (69% oil) Upsized frac design unlocks oil window in the Avalon 13,700 net acres identified as prospective in Lea County 200+ locations…
  10. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 10
    Delaware Basin Wolfcamp Fairway 235,000 net acres in the fairway Multiple Wolfcamp Targets Culberson/White City Area 100,000+ net acres Wolfcamp D, C & A producing JDA with Chevron Reeves County New focus area 80,000 net acres…
  11. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 11
    Thick, Multipay Wolfcamp Section Culberson Area Reeves County Ward County 100,000 net acres 80,000 net acres 42,000 net acres IIndicates producing zone. 12 12
  12. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 12
    Culberson Focus Area Wolfcamp 100,000 netnet 100,000+ acres acres Joint Development Area with CVX 2013 main objectives Long laterals in Wolfcamp D show Drilling to significant hold acreage uplift Wolfcamp C &peak 30day average…
  13. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 13
    Upsized Returns from Long Lateral with Upsized Frac Culberson County Wolfcamp D Wells BOE/day 3000 Old New Long 2500 Well Cost (MM) 8.0 9.0 13.5 BT IRR 30% 90% 161% NPV10 (MM) 4.0 12.2 31.6 2000 Assumptions: Oil 90/bbl; Gas…
  14. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 14
    Upsized Returns Oil Price Sensitivity Culberson County Wolfcamp D Wells Before Tax IRR 122% 113% 89% 74% 65% 60% 45% 37% 5,000 ft. lateral 10,000 ft. lateral 50 60 75 80 Realized Oil Price Assumes 3.50/Mcf gas;…
  15. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 15
    Reeves & Ward Counties Emerging Wolfcamp Reeves County Recent Wolfcamp A well has average 30day peak IP of 1,368 BOE/d; 899bo/d (66%) Upsized frac design +30% uplift to IP First Wolfcamp A downspacing pilots producing . 35mm…
  16. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 16
    Reeves County Wolfcamp A Pilot Fourwell,80acre test Wells producing 30day average peak IP of 1,029 BOE/d; (49% oil) Performing above predrill expectations Nearby acreage available for long laterals First long lateral completing…
  17. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 17
    MidContinent Highlights CanaWoodford Activity Map 128,000 net acres prospective for Woodford Shale (86%HBP) Operated Well Complimentary 238mm Nonoperated Well acquisition in May E&D capex of 480mm Woodford shale development capex…
  18. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 18
    Upsized Production from Upsized Frac CanaWoodford Shale Completion Comparison Average 30day Peak IP (MMcfe/d) 12 Golden Section 10.2 10 9.6 8% 12% 8 6.7 Hartz Section 5% 6 4 2 0 Old completion Golden…
  19. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 19
    MidContinent Regional Activity Map Redefinition of Woodford potential underway Glenda well has 30day Meramec test & peak IP of 12.4 MMcfe/d Woodford long 69% gas, 27% NGL, lateral (Bomhoff) Woodford test (Glenda) 4% oil Leota…
  20. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 20
    Summary Recap Well positioned for 2015 and beyond Focused on Permian projects & CanaWoodford upside Continue generating new ideas Solid base of proved reserves and production 80% proved developed; 10year reserve life Portfolio…
  21. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 21
    Appendix 22 22
  22. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 22
    Upsized Wolfcamp Frac Old Frac Design: 5,000foot lateral; 12 stages; 4mm lbs of sand New Frac Design: 5,000foot lateral; 20 stages; 6mm lbs of sand 23
  23. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 23
    CanaWoodford Production 450 MMcfe/day 406 400 350 310 300 255 250 229 226 215 216 217 200 184 161 156 150 100 50 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Gas NGL Oil 24 24
  24. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 24
    Permian Production Growth MBOE/day 70 68 66 60 59 58 55 53 50 49 46 46 41 40 40 36 34 30 30 29 20 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Oil NGL Gas 25…
  25. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 25
    Culberson County Wolfcamp Pilots Stacked Lateral Test 80acre Spacing Pilot Wolfcamp C & D Wolfcamp D Two wells Four wells Producing/Evaluating Producing/Evaluating 26 26
  26. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 26
    Reeves County Wolfcamp Pilots 80acre Spacing Pilot Stacked/Staggered Spacing Pilot Wolfcamp A Wolfcamp A Four wells Six wells Producing/Evaluating Flowing Back 27 27
  27. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 27
    2014 Guidance 2014 Production, Unit Expense and Capital Guidance Fourth Quarter FullYear Production* Total Equivalent (Mmcfe/d) 930955 864870 % Liquids 51% 51% Expenses (/Mcfe): Production 1.08 1.12 Transportation, processing &…
  28. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 28
    Hedges Cimarex Energy Co. Hedge Summary Oil Weighted Average Price (1) Period Index Type Bbl/d Floor Ceiling Oct. - Dec. '14 WTI Collar 12,000 85.00 103.47 Gas Weighted Average Price (1) Period Index Type MMBTU/d Floor…
  29. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 29
    NonGAAP Reconciliation Reconciliation of Net Income to EBITDA and Adjusted EBITDA ( in Millions) 2011 2012 2013 Net income (loss) 530 354 565 Income tax expense (benefit) 312 207 329 Interest expense, net of capitalized 7 14 23…
  30. NOVEMBER 2014 CORPORATE UPDATE – Cimarex Energy Co. – slide 30
    NonGAAP Reconciliation Reconciliation of cash flow from operations Debt/Cap Calculation Nine months September 30, Ended September 30, 2014 2014 2013 (in millions) (in millions) Long-term debt 1,500 Net cash provided by operating…

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