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Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Feb 11, 2014 · 49 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 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 1
    Fourth Quarter 2013 Earnings February 11, 2014
  2. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 2
    Financial and Operating Highlights Q4 2013 adjusted income1 of 140 MM, or 1.00 per diluted share1 Q4 2013 production: 164 MBOEPD from continuing operations (excludes previously-announced sale of Alaska assets and plan to sell Barnett…
  3. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 3
    Financial and Operating Highlights (cont.) Forecasting 2014 annual production growth from continuing operations of 14% to 19% based on planned drilling capital expenditures of 3.0 B Increasing horizontal rig count from 5 rigs at YE…
  4. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 4
    Drilling Highlights Northern Spraberry/Wolfcamp horizontal oil drilling Production data from first 10 Wolfcamp A, B and D wells, which have been on production for an extended period of time, supports the following EURs and returns for…
  5. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 5
    Drilling Highlights (cont.) Northern Spraberry/Wolfcamp horizontal oil drilling (cont.) Placed first 5 Lower Spraberry Shale wells on production in Q4/early January in Andrews, Glasscock, Martin and Midland counties Early production…
  6. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 6
    Drilling Highlights (cont.) Eagle Ford Shale horizontal drilling Initial 300 downspaced and staggered Lower Eagle Ford Shale well performance on par with offset 500 spaced wells Initial Upper Eagle Ford Shale well continuing to…
  7. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 7
    2014E Capital Spending and Cash Flow1 Capital program of 3.3 B Drilling Capital: 3.0 B 2,165 MM northern Spraberry/Wolfcamp area o 1,225 MM for horizontal drilling program Sensitivity to Commodity Prices ( MM) 6.00 o 440 MM for…
  8. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 8
    Targeting 16% - 21% Compound Annual Production Growth for 2014 - 2016 MBOEPD 161 MBOEPD1 (+12% vs. 2012) Severe weather curtailed Q4 production by 6 MBOEPD 184 - 192 159 163 159 164 62% 62% 64% 65% 75% Liquids Liquids…
  9. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 9
    Pioneers Spraberry/Wolfcamp Net Recoverable Resource Potential Continues To Grow1 Capital Efficiency Driving Transition from Vertical to Horizontal Development 2013 2014 Spraberry/Wolfcamp Net Recoverable Spraberry/Wolfcamp Net…
  10. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 10
    Pioneers Significant Proved Reserves and Recoverable Resource Potential1 Proved Reserves + Estimated Net Recoverable Resource Potential of 11 BBOE 22,000 Horizontal Drilling Locations 12/31/13 Proved Reserves: 845 MMBOE2 Additional…
  11. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 11
    2013 Northern Spraberry/Wolfcamp Horizontal Drilling Appraisal Program 2013 drilling program focused on appraising 6 horizontal shale targets with substantial oil-in-place Wolfcamp Wolfcamp Wolfcamp M. Spraberry L. Spraberry D B A…
  12. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 12
    Recapping Pioneers 2013 Northern Spraberry/Wolfcamp Program Increased horizontal rig count from 1 rig to 5 rigs mid-2013 Placed 21 horizontal wells on production Pioneers Northern during 2013 Spraberry/Wolfcamp Acreage Avg. 24-hr…
  13. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 13
    Pioneers First 6 Northern Horizontal Wolfcamp B and Wolfcamp A Shale Wells1 E.T. O'Daniel 1H Wolfcamp B (Midland County); 9,229 lateral Cumulative production: 100 MBOE (75% oil) Scharbauer Ranch 202H Wolfcamp B (Martin County); 8,342…
  14. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 14
    Pioneers New Wolfcamp B Shale Well Results U. Spraberry M. Spraberry Scharbauer Ranch 203H (Q4) Shale 24-hr IP: 756 BOEPD 30-day IP: 571 BOEPD Jo Mill Shale 7,622 lateral length Jo Mill Silt L. Spraberry Shale Mabee K 4H…
  15. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 15
    Pioneers First 4 Northern Horizontal Wolfcamp D Shale Wells1 University 7-43 10H Wolfcamp D (Andrews County); 7,382 lateral Cumulative production: 50 MBOE (69% oil) E.T. ODaniel 2H Wolfcamp D (Midland County); 9,112 lateral…
  16. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 16
    Pioneers Northern Horizontal Lower Spraberry Shale Wells1 Flanagan 14 Lloyd A 21H (Glasscock County) 7,212 lateral; 24-hour peak IP rate of 1,010 BOEPD (82% oil) Hutt C 21H (Midland County) 6,662 lateral; 24-hour peak IP rate of 537…
  17. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 17
    Northern Horizontal Well Economics1,2 BTAX IRR 100+% 45% - 100% 100+% 45% - 95% Lower Spraberry Wolfcamp D Martin County Midland County Shale Wolfcamp B & Wolfcamp B Midland County Wolfcamp A EUR (MBOE) 575 800 650 - 800 800…
  18. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 18
    Northern Spraberry/Wolfcamp: Focused on Growing Production in 2014 Transitioning from a horizontal appraisal program to a horizontal development program during 2014 Increased horizontal rig count from 5 rigs at YE 2013 to 10 rigs at…
  19. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 19
    Southern Wolfcamp JV: Focused on Growing Production in 2014 2014 drilling plan calls for spudding 115 horizontal wells compared to 100 horizontal wells in 2013 Average lateral length will be increased by 13% from 8,300 feet in…
  20. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 20
    Downspacing Test Underway in Southern JV Area Joint Venture Area Began testing downspacing from 720 (116-acre spacing) (Wolfcamp and deeper intervals) to 480 (77-acre spacing) in the Giddings area during Q3 Tested 12 wells on 3-well…
  21. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 21
    Spraberry/Wolfcamp Production Outlook Spraberry/Wolfcamp Net Production1 (MBOEPD) Q4 production curtailed by 5 MBOEPD due to severe winter weather Despite severe winter weather, horizontal 95 100 MBOEPD Spraberry/Wolfcamp Shale…
  22. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 22
    Eagle Ford Shale Downspacing and Staggered Tests Continue Initially downspaced from 1,000 to 500 between wells across liquids- rich acreage position Added 300 locations Further downspacing and staggered laterals testing underway:…
  23. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 23
    Upper Eagle Ford Shale Test Update Results from initial test continue to be encouraging; production in line with Upper Eagle Ford Test offset Lower Eagle Ford Shale wells 25% of acreage prospective Planning to drill 45 Upper Eagle…
  24. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 24
    Eagle Ford Shale Completion Optimization Over the past 2 years, PXD has improved its Eagle Ford Shale completion design by: Reducing cluster spacing Increasing the pounds of proppant (white sand) pumped per foot Increasing the barrels…
  25. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 25
    Eagle Ford Shale Production Outlook Eagle Ford Shale Net Production1 (MBOEPD) Record Eagle Ford Shale net production of 40 MBOEPD in Q4 45 49 MBOEPD Placed 41 wells on production in Q4; predominately weighted 38 MBOEPD towards…
  26. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 26
    Q4 2013 Earnings Summary Millions Per Diluted (After Tax) Share Net loss attributable to common stockholders (1,367) (9.82) Noncash mark-to-market (MTM) derivative losses (42 MM before tax) 28 0.20 Adjusted income excluding noncash…
  27. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 27
    Price Realizations1 Realized Prices 101.70 90.35 90.88 87.67 83.65 31.13 30.86 30.76 30.71 28.54 3.76 3.44 3.21 3.17 3.35 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Oil…
  28. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 28
    Production Costs (per BOE)1 Q4 2013 production costs 14.04 14.08 14.17 Workovers 13.77 decreased compared to Q3 0.69 13.36 0.88 0.87 0.99 0.52 2013 Production & Ad Valorem LOE increased primarily due to Taxes 3.24 3.52 3.61…
  29. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 29
    Liquidity Position (12/31/13) Net debt (net of cash balance of 393 MM): 2.3 B Unsecured credit facility availability: 1.5 B Net debt-to-book capitalization: 25% Maturities and Balances1 2016 2017 2018 2020 2022 2028 455 MM 485…
  30. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 30
    Q1 2014 Guidance1 Guidance Daily Production (MBOEPD) 166 171 Production Costs (/BOE) 13.50 15.50 Exploration & Abandonment ( MM) 25 35 Drilling and Acreage 15 Personnel and Seismic 20 DD&A (/BOE) 13.50 15.50 G&A ( MM) 70…
  31. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 31
    Pioneers YE 2013 Proved Reserves1 Added 141 MMBOE from the drillbit, or 211% of full- year production, at a drillbit F&D cost of 19.70 per BOE2 Reflects significant drilling campaigns in horizontal Spraberry/Wolfcamp Shale and Eagle…
  32. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 32
    2013 Drilling Capital1 Millions 2,765 767 717 673 608 Q1 '13 Q2 '13 Q3 '13 Q4 '13 FY '13 1) Includes land capital and excludes asset retirement obligations, capitalized interest and G&G G&A 34
  33. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 33
    Production (MBOEPD) Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 1 2 Spraberry/Wolfcamp 69 75 80 79 80 Eagle Ford Shale 35 37 38 35 40 Raton 24 23 23 22 22 Mid-Continent 17 17 16 17 16 South Texas 6 5 5 6 5 Other 1 1 1 1 1 Total Cont.…
  34. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 34
    PXD Production By Commodity By Area Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 Spraberry/Wolfcamp Oil (BOPD) 46,540 52,694 52,595 51,903 52,957 NGL (BOEPD) 11,262 12,864 13,919 16,200 16,251 Gas (M CFD) 64,607 58,653 83,021 62,939 65,863…
  35. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 35
    Oil and Gas Revenue1 Millions 836 810 781 729 674 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Q4 '13 37 1) All periods presented have been restated to exclude discontinued operations
  36. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 36
    Open Commodity Derivative Positions as of 2/6/2014 Oil Q1 2014 Q2 2014 Q3 2014 Q4 2014 2015 2016 Swaps WTI (BPD) 10,000 10,000 10,000 10,000 - - NYMEX WTI Price (/BBL) 93.87 93.87 93.87 93.87 - - Three Way Collars (BPD)1 69,000…
  37. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 37
    Open Commodity Derivative Positions as of 2/6/2014 Natural Gasoline Q1 2014 Q2 2014 Q3 2014 Q4 2014 2015 Three Way Collars (BPD)1,2 1,000 1,000 1,000 1,000 - Mont Belvieu Call Price (/BBL) 109.50 109.50 109.50 109.50 - Mont…
  38. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 38
    Open Commodity Derivative Positions as of 2/6/2014 Gas Q1 2014 Q2 2014 Q3 2014 Q4 2014 2015 2016 Swaps - (MMBTUPD) 195,000 195,000 195,000 195,000 20,000 - NYMEX Price (/MMBTU)1 4.04 4.04 4.04 4.04 4.31 - Three Way Collars…
  39. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 39
    Oil Differentials (per BBL)1 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 NYMEX calendar month average 88.18 94.37 94.22 105.82 97.46 NYMEX differential (4.53) (6.70) (3.87) (4.12) (6.58) Realized prices 83.65 87.67 90.35 101.70 90.88 Derivatives not…
  40. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 40
    NGL Differentials (per BBL)1 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 NYMEX oil calendar month average 88.18 94.37 94.22 105.82 97.46 NYMEX differential (57.07) (63.51) (65.68) (75.06) (66.75) Realized prices 31.13 30.86 28.54 30.76 30.71…
  41. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 41
    Gas Differentials (per MCF)1 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 NYMEX bid week average 3.41 3.34 4.10 3.58 3.60 NYMEX differential (0.20) (0.17) (0.34) (0.23) (0.16) Realized prices 3.21 3.17 3.76 3.35 3.44 Derivatives not included in…
  42. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 42
    General & Administrative Costs1 Millions 96 72 14 Noncash 67 66 62 14 12 13 13 Q4 Q1 Q2 Q3 Q4 2012 2013 2013 2013 2013 44 1) All periods presented have been restated to exclude discontinued operations
  43. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 43
    Interest Costs Millions 54 51 9 5 45 45 43 4 4 Noncash 4 Q4 Q1 Q2 Q3 Q4 2012 2013 2013 2013 2013 45
  44. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 44
    Exploration & Abandonments1 Millions Drilling & Acreage: 11 Geological & Geophysical: Seismic 4 Personnel & Other 17 4th Quarter 2013 Total 32 46 1) Excludes discontinued operations
  45. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 45
    Income Taxes Attributable to Continuing Operations Quarter Ended December 31, 2013 ( Millions) Current tax provision (5) Deferred tax benefit 499 Income tax benefit 494 47
  46. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 46
    Supplemental Non-GAAP Financial Measures EBITDAX and discretionary cash flow (DCF) are disclosed by Pioneer, and reconciled to the generally accepted accounting principle (GAAP) measures of net loss and net cash provided by operating…
  47. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 47
    Supplemental Earnings Per Share Information The Company uses the two-class method of calculating basic and diluted earnings per share. Under the two-class method of calculating earnings per share, GAAP provides that share- and unit-based…
  48. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 48
    Supplemental Non-GAAP Financial Measures Adjusted income excluding noncash MTM derivative losses and adjusted income excluding noncash MTM derivative losses and unusual items, as presented in the Financial and Operating Highlights slide…
  49. Q4 2013 EARNINGS CALL – Pioneer Natural Resources Co. – slide 49
    Certain Reserve Information Cautionary Note to U.S. Investors --The SEC prohibits oil and gas companies, in their filings with the SEC, from disclosing estimates of oil or gas resources other than reserves, as that term is defined by the…

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