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JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp.

Magnum Hunter Resources Corp. · Jan 30, 2012 · 50 slides

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Slides

  1. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 1
    MAGNUM HUNTER RESOURCES CORPORATION Corporate Presentation January 2012
  2. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 2
    Corporate Overview Market Capitalization 800 MM Enterprise Value 1,170 MM Net Debt/Total Cap 20% YE 2011 Exit Rate 12,500 BOE/D YE 2012 Exit Rate (Est.) 15,000 BOE/D Proved Reserves 45 MMBOE Resource Potential 538 MMBOE…
  3. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 3
    Executive Summary Magnum Hunter Resources is focused exclusively on three of the most prolific unconventional resource plays in the United States: South Texas Eagle Ford Shale Appalachia Marcellus Shale / Utica / Huron / Weir North…
  4. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 4
    Current Portfolio Overview Focused exclusively on three unconventional resource plays 81,740 Net Acres 58,048 Net Marcellus Acres 16,000 Net Utica Shale Acres 273,000 Net Southern Appalachia Acres 24,369 Net Acres…
  5. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 5
    IRRs of Top U.S. Shale Plays MHR Active Resource Plays 60% 51% 50% 47% 40% 34% 34% 30% 25% 25% 23% 22% 20% 19% 20% 18% 16% 16% 14% 14% 13% 11% 10% 8% 7% 7% 5% 2% 0% Year: 1 2 3 4 5 6 7 8+ WTI Oil: 93.18 87.55…
  6. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 6
    2012 Capital Expenditure Budget 2012 Capital Budget - 200 Million Appalachia Williston Basin 50 mm 50 mm 25% 25% 50 mm 50 mm 25% 25% (i) Eagle Ford Eureka Hunter Note: Magnum Hunter currently operates over 80% of its…
  7. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 7
    Projected Production Growth Natural Gas Oil / Liquids Shut-in 16,000 15,000 14,000 12,500 12,000 10,000 9,166 Boe/d 8,000 6,020 6,000 5,747 (2) (1) 5,270 4,947 4,000 2,269 2,000 0 1Q11A 2Q11A 3Q11A…
  8. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 8
    Platform for Continued Growth December 31, 2011* December 31, 2011* Proved Reserves: 44.9 Mmboe Proved Reserves by Region 48% Oil / Liquids Eagle Ford PDP PUD 13.7% 46.1% 50.9% 66.6% 19.7% Appalachia Williston Basin 3%…
  9. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 9
    Williston Basin 10
  10. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 10
    Williston Hunter Overview (1) Total proved reserves of 8.9 MMBoe as of December 31, 2011 Proved Reserves Proved producing reserves of 3.8 MMBoe as of December 31, 2011 90% crude oil Production 90% from the Williston Basin Over…
  11. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 11
    Williston Hunter Areas of Operation 75% Avg. WI 35,240 net acres 10% Avg. WI 30% Avg. WI 28,350 net acres 11,700 net acres 50% Avg. WI 6,450 net acres Recently Acquired MHR Existing NuLoch Assets Assets 12
  12. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 12
    Williston Hunter Recent Well Results IP7 IP30 IP60 7 Day 30 Day 60 Day MHR Lateral Frac IP24hr Average Average Average Well County W.I.% Length Stages Zone boepd boepd boepd boepd North Dakota Thomte 8-5-163-99 Divide 10.0 2 Mile…
  13. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 13
    Williston Hunter Tableland, SK Bakken / TFS - Gross Production Data 1D16-16-1C13-16-1-10 2C12-2-1C12-3-1-11 3D1-10-3D1-11-1-10 1D1-15-3A1-14-1-10 2B13-11-2A16-11-1-10 3B4-28-3A1-28-1-10 2C13-2-2D16-2-1-10 4A8-16-3A5-16-1-10…
  14. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 14
    Williston Hunter North Dakota Bakken / TFS - Gross Production Data 7000 6000 5000 Oil Rate BOPD 4000 3000 2000 1000 0 15
  15. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 15
    Williston Basin Economics Sensitivity North Dakota (2 mile lateral) Saskatchewan (1 mile lateral) North Dakota (2 mile lateral) CAPEX: 6.9 Million CAPEX: 3.4 Million IP-24 Hour: 550 Bbl/D IP-24 Hour: 250 Bbl/D Saskatchewan (1 mile…
  16. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 16
    Eagle Ford Shale 17
  17. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 17
    Eagle Ford Hunter Overview (1) Total proved reserves of 6.2 MMBoe as of December 31, 2011 Proved Reserves Proved producing reserves of 1.5 MMBoe as of December 31, 2011 85% crude oil, with high btu gas (+1350) Production 15…
  18. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 18
    Eagle Ford Shale Oil Window MHR currently holds over 23,500 net acres in the Eagle Ford Shale core Majority of the acreage position is in the Gonzales County oil window Strong well results by offset operators MHR: Oryx Hunter 1H…
  19. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 19
    Eagle Ford Hunter - Operations MHR Lateral Stages IP Rate (Boe/d) First Well County Operator Interest Length Fraced 24-hour 7-day 30-day Production MHR Operated (Gonzales/Lavaca County): Gonzo Hunter 1H Gonzales MHR 50% 4,365 9 of 11 605…
  20. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 20
    Eagle Ford Hunter Gross Production Gonzo Hunter 1H Lagunillas 2H Lagunillas 1H Southern Hunter 1H Gonzo North 1H Cinco 2H Cinco 1H Furrh 1H Geo Hunter 1H Oryx Hunter 1H Sable Hunter 1H Furrh 2H Kudu Hunter 1H 4,000 3,500…
  21. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 21
    Economic Sensitivity of Eagle Ford Gonzales County High Case: Mid Case: Low Case: Capex: 8.0MM + .02MM PU Capex: 8.0MM + .02MM PU Capex: 8.0MM + .02MM PU IP-24 Hour: 1,280 bbl/d IP-24 Hour: 800 bbl/d IP-24 Hour: 613 bbl/d Initial…
  22. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 22
    Appalachia 23
  23. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 23
    Appalachia Overview Magnum Hunters Appalachia assets are a combination of multiple acquisitions Magnum Hunter has completed over the past year and a half including Triad, NGAS, PostRock, and Windsor. (1) Total proved reserves of…
  24. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 24
    Appalachia Areas of Operation Primary focus on liquids rich Marcellus gas in northwest West Virginia Triad Hunter NGAS Hunter The Marcellus is one of the most attractive shale plays in the United States Ohio The Marcellus has one…
  25. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 25
    Triad Hunter Liquids Rich Marcellus Shale Pennsylvania Ohio Marcellus Properties / Operations: 60,382 Net Marcellus/Utica Acres To-date thirteen wells have been drilled and completed Seven wells in Tyler County, WV Five wells in…
  26. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 26
    Marcellus Operations MHR Lateral Frac IP Rate (mcfe/d) First Well County Operator Interest Length Stages 24 Hour 7-day 30-day Production Weese 1H Tyler MHR 100% 3,550 12 7,210 4,559 4,205 12/31/2010 Weese 3H Tyler MHR 100% 3,030 12…
  27. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 27
    Triad Hunter Gross Marcellus Production Weese 1001 Weese 1003 Ormet 1-9H (1) Stone Unit 2 - 2H Stone Unit 3 - 5H WVDNR 1102 WVDNR 1103 WVDNR 1104 WEESE 1110 E WEESE 1107 E WEESE 1108 E WEESE 1109 60,000 50,000 40,000…
  28. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 28
    MHR / Stone Energy Joint Venture Joint Venture Overview: 1,925 acres located in Wetzel County, WV 19 horizontal wells to be drilled on JV acreage over the next two years Triad Hunter / Stone Energy JV Acreage Triad Hunter 50%…
  29. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 29
    Economic Sensitivity of Marcellus Economic Sensitivity of Marcellus Gas Price, /MMBtu High Middle Low Completed Well Cost - 5.0MM High Case: Middle Case: Low Case: IP-24 Hour: 7 Mmcf/D IP-24 Hour: 5 MMcf/D IP-24 Hour: 2.5MMcf/D…
  30. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 30
    Utica Shale Overview MHR has approximately 48,965 net acres that are prospective for the Utica Shale Wet MHR has Utica potential in: Gas Monroe County, OH Noble County, OH Washington County, OH Tyler County, WV Pleasants…
  31. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 31
    Southern Appalachia Overview NGAS Hunter Operations: Kentucky Since the close of the NGAS transaction, twenty-one wells (17.9 net) have been successfully drilled and completed Current Drilling/Completing Operations: Drilling one…
  32. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 32
    Weir Sand Monthly Production 38,000 PROSPECTIVE ACRES HORIZONTAL WELLS TO DATE 1 MD: 5660 VS: 2039 5645 of Production Casing Ran 10 Stage Slick Water Frac 2 MD: 6207 VS: 2510 6193 of Production Casing Ran 12 Stage 65 Quality Foam…
  33. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 33
    Appalachia Shale Has Best Economics Estimated Gas Price Required for 10% IRR 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 Source: Morgan Stanley Research Report (January 2011) 34
  34. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 34
    Eureka Hunter 35
  35. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 35
    Eureka Hunter Pipeline Background Acquired by Magnum Hunter from Triad Energy in February 2010 First Priority: Be there and ready for Triad Hunter equity gas Upsized pipe to 20 inches to capture 3rd party producers Local producers…
  36. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 36
    Eureka Hunter Pipeline - Overview Eureka Hunter Eureka Hunter 20 Pipeline(s) and Right of Ways and Connecting Gathering Systems MarkWest Ohio and West Virginia Mobley Plant Eureka Carbide Mobley to Site - Equitrans - TCO…
  37. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 37
    Eureka Hunter Pipeline Key Points 20 - 900 psi gathering system. Maximum allowable operating pressure 1,000 psi 200 300 Mmcf per day design capacity could be increased Strategically located in heart of Marcellus wet gas corridor of…
  38. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 38
    Eureka Filling Void in Northern WV MHR Acreage WI 100% or HBP MHR Acreage…
  39. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 39
    1/30/2012 Utica Shale Overview The Utica Shale: The Utica extent extends for 170,000 sq miles (Nearly twice the size of the Marcellus Shale extent) Big players are attracted to Utica including CHK, Range, Consol, Devon,…
  40. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 40
    Construction Photos 41
  41. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 41
    Financial Overview 42
  42. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 42
    Financing Highlights Senior Credit Facilities of 350 million provided by Amegy Bank, BMO, Capital One, Citibank, Credit Suisse, Deutsche Bank, Goldman Sachs, KeyBanc, SunTrust Bank, UBS and Union Bank Revolving Credit Facility of up to…
  43. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 43
    Additional Equity Issued NuLoch Acquisition (VWAP of 7.40/share) 314 Million NGAS Acquisition (VWAP of 7.99/share) 56 Million PostRock Acquisition (VWAP of 7.92/share) 8 Million Total Equity Capital Issued in Acquisitions of 378…
  44. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 44
    Capitalization December 31, December 31, March 31, June 30, September 30, 2009 2010 2011 2011 2011 Cash and Cash Equivalents 2,281 554 3,836 4,750 10,687 (1) Notes Payable, Less Current Portion 13,000 33,151 35,798 145,791…
  45. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 45
    Summary of Commodity Hedges in Place (As of December 2011) 2012 2013 NATURAL GAS HEDGES: Swaps Volume (mmbtu/d) 6,098 6,000 Price - /mmbtu 4.16 4.13 Collars Volume (mmbtu/d) 11,879 12,500 Floor Price - /mmbtu 4.58 4.50 High…
  46. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 46
    Historical Lifting Costs 30.00 27.67 25.00 22.32 20.00 15.69 15.00 10.00 5.00 - 3Q 2009 3Q 2010 3Q 2011 47
  47. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 47
    Financial Goals Continue to increase Senior Credit Facility borrowing base through reserve additions from organic growth through the drill bit Move allocated capital to higher IRR projects within the portfolio Continue to issue…
  48. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 48
    Summary Experienced and Seasoned Management Team and Board Significant Insider Ownership 15% Well Positioned in the Three Top Resources Plays in the US Demonstrating Tremendous Growth in Daily Production Diversified, Balanced…
  49. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 49
    Contact Information Magnum Hunter Resources (NYSE: MHR) Equity Research Analyst Coverage: BMO Capital Markets Pritchard Capital Canaccord Genuity Robert W. Baird & Co. Capital One Southcoast, Inc. Rodman & Renshaw. Caris & Company…
  50. JANUARY 2012 CORPORATE PRESENTATION – Magnum Hunter Resources Corp. – slide 50
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