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JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc.

Diamondback Energy, Inc. · Jun 19, 2015 · 32 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 – Diamondback Energy, Inc. – slide 1
    Investor Presentation June 2015
  2. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 2
    Diamondback Energy Overview High Returns in Current WTI Environment At 60 WTI with recalibrated service costs and operating efficiencies the Diamondback Energy Acreage Company expects to generate comparable returns as when WTI was…
  3. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 3
    A Growth Story Average Daily Net Production (Mboe/d)1 Revenue Growth1 ( in MMs) 29.0-31.0 Guidance2 Increase from original guidance on February 17, 2015 19.5 7.3 3.8 Key Highlights Adjusted EBITDA Growth1 ( in MMs)…
  4. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 4
    2015: Capital Discipline Remains Key Responding to Market Conditions with 2015 Production and Capex Guidance Permian Rig Count2 At 60 WTI with recalibrated service costs and operating efficiencies, the Company expects to generate…
  5. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 5
    Diamondback Has Reduced Costs in Current Commodity Environment Cooperation with service cost Breakdown of Current Costs1 providers has led to further reductions in AFEs Leading-edge AFEs are down 20-30% from 2014 peak Company…
  6. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 6
    Peer Leading Capital Efficiency, Conservative Leverage & Attractive Valuation FY2014 Recycle Ratio1,2 Key Highlights Peer leading cash margins and F&D costs drive differential recycle ratio Peer Avg: 329% FANG has a strong balance…
  7. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 7
    Peer Leading Cash Margins Cash Margins Have Consistently Exceeded Peers1,2 FANG Operating Expenses Below Peers1 (/boe) LOE Prod. Taxes G&A 10% FANG Peer Average 18.12 18.27 Lower 75.00 /boe 16.88 16.18 66.66 15.37 63.50 14.17 65.00…
  8. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 8
    Resilient Lower Spraberry Economics in Spanish Trail Spanish Trail Lower Spraberry Economics At 60 WTI, Generating 85-200% ROR At 50 WTI, Generating 50-125% ROR (1) (1) Spanish Trail Lower Spraberry EUR increased by…
  9. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 9
    Lower Spraberry Performance Midland (1) Note: Daily production normalized for operational shut-ins. Type curves based on normalized 7,500 laterals; actual lateral lengths vary. 10
  10. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 10
    Lower Spraberry Performance Martin and Andrews Note: Daily production normalized for operational shut-ins. Type curves based on normalized 7,500 laterals; actual lateral lengths vary. 11
  11. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 11
    Significance of the Lower Spraberry New horizontal development target in formation considered marginally Acreage Map economic for decades Positive tests across acreage base 1 MMboe EUR in Midland County, 0.7 MMboe in Glasscock, and…
  12. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 12
    Spanish Trail Microseismic Recently completed microseismic and tracer survey of three simultaneously stimulated horizontal wells in the Lower Spraberry. Microseismic data is currently in final processing stage; results will be tied…
  13. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 13
    Horizontal Execution Peer Leading Performance Drives Lower Well Costs and Higher Returns Days vs Depth Hz1 Faster drilling times lead to lower well costs and higher rates Diamondback Peers of return Leading edge two-well pad in…
  14. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 14
    Adding Acreage in the Core of the Northern Midland Basin Recently acquired or signed agreements to acquire 11,948 net acres mostly in NW Howard County for 438MM Acquisition Acreage Map Production of 2.5 MBOEPD1 from 120 gross wells…
  15. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 15
    Compelling Acquisitions to Add Attractive Horizontal Inventory Accretive to stockholders Midland Basin Net Acreage Expected to be accretive on net asset value, production, acreage and on 2016 earnings valuation metrics Attractive…
  16. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 16
    Acquisition Acreage is Central to Some of the Best Well Results in the Midland Basin Gardner Unit 15-10 2H Element Wright 44-41 3H IP30: 724 Boepd (91% oil) Element EUR: 802 MBOE IP30: 929 Boepd (91% oil) Lateral Length: 7020 EUR :…
  17. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 17
    Comparison to Spanish Trail 1 2 Acquisition Acreage Map 2 Oil in Place Oil in Place Spanish 30 Trail Midland MMBO/ 35 SQMI Basin MMBO/ Eastern SQMI Shelf 1 40 41 MMBO/ MMBO/ SQMI SQMI 93 100 Central 30 MMBO/ 32…
  18. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 18
    Diamondback Energy Reserves Summary Total Reserves Growth1 (MMboe) Proved Reserves Represent Over a Decade of Reserve Life3 117.22 Pro forma 2014 total proved reserves increased 84% y/y to 117.2 MMboe IPO Diamondbacks pro forma…
  19. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 19
    Robust Multi-year Inventory Identified Net Potential Drilling Locations Announced Acquisitions 996 3,620 673 1,814 73 232 64 Horizontal Additional 40-Acre Additional 20-Acre Total PUDs Horizontal PUDs 40-Acre Spacing…
  20. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 20
    Financial Overview 21
  21. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 21
    Liquidity and Financial Profile FANGs Liquidity and Capitalization Pro forma net debt to annualized 1Q15 Adj. EBITDA of 1.6x1 FANG's Pro Forma Capitalization as of 3/31/15(2) Strong balance sheet with the ability to use its 88%…
  22. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 22
    Diamondback Energy Hedging Hedging1 Oil Swaps 2015 Average Bbls Per Day Average Price Per Bbl Oil Swaps 2015 Average Bbls Per Day Average Price Per Bbl First Quarter 15 LLS 6,344 95.57 Third Quarter 15 LLS 3,000 90.99 First…
  23. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 23
    Diamondback Energy Updated 2015 Guidance1 Diamondback Capex Budget ( - million) Diamondback Viper Energy Horizontal Drilling and Completion 285 315 Energy, Inc. Partners LP Net Production Mboe/d1 29.0 31.0 4.6 5.0 Infrastructure 20…
  24. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 24
    In Conclusion Diamondback Energy is a low-cost operator in one of the highest return basins. Complementary acreage additions Midland Basin focused Maintain operations excellence Efficient capital allocation Debt/Adjusted EBITDA…
  25. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 25
    Attractive Acquisition and Development Economics Announced Acquisitions Management believes acreage is in top quartile of FANGs existing acreage portfolio based on well results in immediate proximity Believe 3 horizontal zones are…
  26. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 26
    Lower Spraberry Type Curve & Economics at 60 Oil Midland County Type Curve Economics ROR Sensitivity EUR, 2 Stream Mboe 990 EUR Mboe Well Cost MM Peak 30 day IP, boe/d 1,030 650 810 990 1,200 Oil %, 2 stream basis 79% 5.5…
  27. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 27
    Midland County Wolfcamp B Type Curve & Economics at 60 Oil Type Curve Economics ROR Sensitivity EUR, 2 Stream Mboe 638 EUR Mboe Well Cost MM Peak 30 day IP, boe/d 808 600 638 700 750 Oil %, 2 stream basis 76% 5.5 34% 40%…
  28. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 28
    Downspacing and Stacked Pay Potential in Spanish Trail Upside Potential Increase from 6 to 8 per section Increase from 8 to 10 per section Increase from 4 to 8 per section Could see upside from downspacing and…
  29. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 29
    Superior Geosteering & Hydraulic Fracturing Offset Well Control Wolfcamp B Seismic Surface Hz Target Window (30) Well Path Frac Gradient - Blue Breakdown Pressure - Red Prop Weight - Red Fluid Volume - Blue Total Gas…
  30. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 30
    Viper Energy Partners Landmark IPO of Mineral Interests September 2013 - acquired 14,804 gross acres of minerals in the core of the Northern Midland Basin Non-traditional investment for an E&P company, unique opportunity with…
  31. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 31
    Development of Viper Energys Spanish Trail is Well Underway Operators Incentivized to Drill Two Dedicated Hz Drillers 21.4% average revenue interest in 15,460 gross acres in Midland County known as Spanish Trail Viper does not pay…
  32. JUNE 2015 INVESTOR PRESENTATION – Diamondback Energy, Inc. – slide 32
    EBITDA Reconciliation ( in thousands) 2013 2014 1Q15 Net income (loss) 54,587 195,971 6,439 Change in the fair value of open non-hedge derivative instruments, net (5,346) (117,109) 25,206 Interest expense 8,059 34,515 10,497…

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