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BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co.

Cimarex Energy Co. · Mar 1, 2012 · 26 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. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 1
    Brean Murray 2012 Global Resources Conference March 1, 2012
  2. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 2
    Corporate Profile NYSE: XEC 2 Shares outstanding.. 85.8 MM Proved reserves .... 2.05 Tcfe 1 Market cap 7.1 ......... B % Natural gas.. 59% 2 Long-term debt 0.4 B ........ % Proved developed... 82% Enterprise value..... 7.5 B…
  3. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 3
    2011 Highlights Earnings and Cash Flow Net income of 530 MM or 6.15 per diluted share Cash flow from operating activities of 1.3 B vs. 1.1 B in 10 O&G Sales of 1.7 B vs. 1.6 B in 10 Higher oil prices (+21%) partially offset by lower…
  4. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 4
    Proved Reserves by Region 2,400 2,045 2,000 1,884 1,600 1,535 620 Bcfe 1,200 561 800 487 400 730 1,029 1,376 - 2009 2010 2011 Mid-Continent Permain Gulf Coast Other 5
  5. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 5
    Proved Reserves 2.4 2.05 2.0 1.88 1.6 1.53 Tcfe 1.2 0.8 0.4 77% Gas 67% Gas 59% Gas - 2009 2010 2011 77% PD 77% PD 82% PD Gas (Bcf) Oil & NGLs (Bcfe) 6
  6. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 6
    2011 Accomplishments Record 2011 PB/MC production of 487 MMcfe/d 16% production growth over 2010 Invested 1.6 B in exploration & development Largely funded with cash flow and property sales Significant expansion and solid returns in…
  7. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 7
    Cimarex Strategy Grow through the drill-bit Portfolio approach Keep a mix of opportunitiesgas/oil; low- medium-higher risk projects; seek geologic and geographic diversity Rate of return based decisions Underpin with low/moderate…
  8. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 8
    2012 Plan E&D capital of 1.4-1.6 B Essentially all investment in oil and liquids rich plays in the Permian and Mid-Continent Fund investment in excess of cash flow with debt (300-500 MM) Credit stats stay strong Production growth 19-25%…
  9. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 9
    Core Operating Areas YE 2011 Reserves 2.05 Tcfe Gulf Mid- Coast Continent 98% 2% 67% Mid-Continent Permian 31% Permian Q4 2011 Prod. 601 MMcfe/d Gulf Coast Mid- Continent 53% 89% Gulf Coast 11% Permian 36% 10
  10. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 10
    2012 Capital Investment 2011 E&D Capital 2012E E&D Capital 1.58 B 1.4-1.6 B Mid- Mid- Continent Continent 42% 47% Permian 46% Permian 52% E&D Well Count E&D Well Count Capital Gross Net Capital Gross Net ( MM) (Drilled…
  11. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 11
    Production Growth 700 +4-10% 25% 615-650 596 592 35-40 600 175 105 20% 580-610 500 487 15% MMcfe/d 400 421 300 10% 200 Year-over-year % growth 5% 100 11% 16% 19-25% - 0% 2010A 2011A 2012E * PB/MC GC/Other…
  12. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 12
    Permian Oil Production (Mbbl/d) 25.0 30% 25% 20.0 21-22 20% 16.8 15.0 Mbbl/d 14.0 15% 10.0 10% Year-over-year % growth 5.0 5% 2% 20% 26-32% - 0% 2010A 2011A 2012E * *Compound annual growth rate (CAGR) to…
  13. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 13
    Permian Basin Summary Statistics Proved reserves (YE 11) 620.4 (Bcfe) 60% liquids; 99% proved developed Production (Q4 11) 215.0 (MMcfe/d) 60% liquids Net acres (YE 11) 438 (000s) Permian Capital Investment 2012E 2011A E&D…
  14. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 14
    Permian Bone Spring/Avalon In 2011 drilled 80 gross (54 net) Bone Spring wells - 63 gross (40 net) in New Mexico 17 gross (14 net) in Texas Strong New Mexico 2nd/3rd Bone Spring fourth-quarter 2011 performance: 30-day IPs…
  15. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 15
    Permian Bone Spring/Avalon Solid returns and strong well performance in 2nd/3rd Bone Spring - EURs: 400-600 MBoe Active 2012 Bone Spring drilling programs: - New Mexico 4-7 rigs - Texas Bone Spring 2-4 rigs - Avalon 1-2 rig…
  16. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 16
    Permian Basin Horizontal Wolfcamp White City/northern Culberson Cty. Strong and improving results White City Over 80,000 net acres Significant resource potential 2012 expect to drill 18-20 wells; 2-3 rigs Fourth-quarter 2011…
  17. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 17
    Mid-Continent Region Summary Statistics Proved reserves (YE 11) 1,375.7 (Bcfe) 32% liquids; 72% proved developed Production (Q4 11) 316.1 (MMcfe/d) 31% liquids Net acres (YE 11) 729 (000s) Mid-Continent Capital Investment 2012E…
  18. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 18
    Cana-Woodford Shale 120,000+ net acres 64,000 Core: < 15,000 deep and 150 shale thickness Drilled or participated in over 330 wells through YE 2011 2012 focus: 10 rig program Infill development in the core 110 gross (49)…
  19. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 19
    Cana-Woodford Core 64,000 net acres (93% Core HBP) High NRIs (81%) and liquids (35%) content contribute to solid economics 2012: beginning infill drilling program with 10 operated rigs on three sections Two well pads Nine…
  20. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 20
    Cana-Woodford Summary Q4-11 production 158 MMcfe/d, 59% increase over Q4 2010 Significant un-booked potential in the Core - 730 net locations (2,200 gross wells) - 4 - 5 Tcfe, net resource potential - YE 2011 proved reserves:…
  21. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 21
    Gulf Coast Summary Statistics Proved reserves (YE 11) 49.0 (Bcfe) Production (Q4 11) 70.3 (MMcfe/d) Net acres (YE 11) 81 (000s) Capital Investment 2012E 2011E Gulf Coast E&D Capital ( MM) 80 95 Wells drilled - gross 8 11 net 6…
  22. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 22
    Key Investment Considerations Diversified drilling program - Well positioned in multi-pay Permian Basin and Mid-Continent; areas which underpin long-term growth and value - Rate of return focused - Quickly adaptable to economic…
  23. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 23
    Appendix 24
  24. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 24
    Hedges Oil Average Price Daily Period Index(2) Type Volume(1) Floor Ceiling Mar - Dec 2012 WTI Collar 14,000 80.00 119.35 (1) Oil volume = bbls/d (2) WTI = NYMEX West Texas Intermediate price. 25
  25. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 25
    Non-GAAP Reconciliation Reconciliation of Net Income to EBITDA ( in Millions) 2007 2008 2009 2010 2011 Net income 346 (902) (312) 575 530 Income tax expense 198 (529) (177) 339 312 Interest expense 18 10 11 1 0 Amortization of…
  26. BREAN MURRAY 2012 GLOBAL RESOURCES CONFERENCE – Cimarex Energy Co. – slide 26
    Non-GAAP Reconciliation Reconciliation of cash flow from operations Debt/Cap Calculation YE YE 2011 2011 (in millions) (in millions) Long-term debt 405 Net cash provided by operating activities 1,292 Change in operating…

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