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AUGUST 2014 INVESTOR PRESENTATION – CIBC

CIBC · Aug 19, 2014 · 25 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. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 1
    Outlook For Energy Markets August 19th, 2014 Katherine Spector Commodities Strategy katherine.spectorcibc.com
  2. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 2
    Outlook For Energy Markets Last Decades Themes: The 2000s 1. Demand ruled the energy balances Emerging market oil demand growth was a key market driver, punctuated by acutely bearish demand events (Sep. 11, bird flu). Then, of…
  3. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 3
    Outlook For Energy Markets US Crude Supply Forecasts Were Low By Half EIAs Forecast Of US Crude Supply, Then & Now million b/d 10 EIAs Forecast in 2014 9 8 7 EIAs Forecast in 2004 6 5 4 EIAs Forecast in 2014 Ex-Tight Oil…
  4. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 4
    Outlook For Energy Markets US Energy Trade Balance Shifts Dramatically Crude Oil Refined Products kbd kbd 12,000 5,000 Net Imports 10,000 4,000 Imports 3,000 Exports 8,000 2,000 6,000 1,000 4,000 Net Imports 0 Imports…
  5. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 5
    Outlook For Energy Markets The Infrastructure We Need Is Not the Infrastructure We Thought We Would Need... Instead of moving imported crude barrels north from the US Gulf to the Midcontinent (the way US pipelines were designed),…
  6. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 6
    Outlook For Energy Markets Themes (& Questions) For This Decade 1. Supply rules the energy balances How much for how long in North America And at what cost What can we reasonably expect from the rest of the world Are there more…
  7. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 7
    Outlook For Energy Markets US + Gulf-3 Bail Market Out Supply Chg, 2013 vs 2010 mbd 3.0 2.5 2.0 1.5 US Saudi + 1.0 Kuwait + 0.5 UAE 0.0 Rest of Non-OPEC -0.5 Rest of OPEC -1.0 -1.5 -2.0 Non-OPEC OPEC CIBC Commodities…
  8. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 8
    Outlook For Energy Markets A New Type of Supply Curve % of Peak Production 100 80 Tight / Shale Oil Conventional Oil 60 40 20 0 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 CIBC Commodities…
  9. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 9
    Outlook For Energy Markets Crude Growth Not From the Majors* In the US kbd 9000 38% 36% 8000 34% 32% 7000 30% Liquids Production By Non-Majors (left) 28% 6000 % US Production By Majors (right) 26% 5000 24% 22% 4000 20%…
  10. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 10
    Outlook For Energy Markets Long-dated WTI Spreads Outpace Flat Price Prompt WTI vs M6-M24 Spread /bbl 160 15 140 10 120 5 100 - 80 (5) 60 40 Mth 1 WTI (left) (10) Mth 6 - Mth 24 Spread (right) 20 (15) '09 '10 '11 '12 '13…
  11. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 11
    Outlook For Energy Markets Producers Procrastinate In Face Of Backwardation % US Oil Production Hedged By End Q1 80% Current Year 70% Current Year + 1 60% Current Year + 2 50% 40% 30% 20% 10% 0% 2010 2011 2012 2013 2014…
  12. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 12
    Outlook For Energy Markets US Crude Production / Import Quality Shift Production Gets Lighter, Imports Heavier Production Gets Sweeter, Imports More Sour Volume Weighted Average API Gravity Volume Weighted Average Sulphur Content 37…
  13. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 13
    Outlook For Energy Markets How Much Imported Light Crude To Back Out 3 Month Average (Through May) kbd 250 Light Sweet From Canada Light Sweet From Far Abroad 200 150 71 50 100 186 4 99 50 84 103 21 0 1 PADD 1 PADD…
  14. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 14
    Outlook For Energy Markets Refined Products Trending In Opposite Directions US Total Oil Demand US Gasoline Demand US Diesel Demand mbd mbd mbd 22 10 4.5 21 4.0 20 9 3.5 19 3.0 18 8 2.5 17 Post Recession Trend 2.0 Post…
  15. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 15
    Outlook For Energy Markets Gross PADD 3 Imports + Exports kbd 9000 Total Oil 8000 Crude 7000 Non-Crude Liquids 6000 5000 4000 3000 2000 1000 0 '82 '84 '86 '88 '90 '92 '94 '96 '98 '00 '02 '04 '06 '08 '10 '12 14 CIBC…
  16. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 16
    Outlook For Energy Markets Corpus Christi Crude Flows: More Is More kbd 900 800 Inbound Crude Outbound Crude 700 600 500 400 300 200 100 0 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 CIBC Commodities Strategy, Port Of Corpus…
  17. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 17
    Outlook For Energy Markets Natural Gas: Weighing the Drivers For the Bulls...* ...For the Bears Yes, ok, it was a severe winter. (Plus summer Supply, supply, supply. drought out West). Mild summer Regulatory risks: fracking…
  18. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 18
    Outlook For Energy Markets Gas Storage Recovering Nicely This Summer End Of Injection Season Storage Scenarios Bcf 4000 3500 3000 2500 2000 5 Yr Range 1500 5 yr Avg Max Hist Inj 1000 Min His Inj 500 J F M A M J J A S O N D…
  19. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 19
    Outlook For Energy Markets Pennsylvania Dominates US Gas Supply Growth YoY Chg in Dry Gas Production Bcf/d 4.0 3.0 2.0 1.0 0.0 -1.0 -2.0 Pennsylvania Rest of US -3.0 Q109 Q309 Q110 Q310 Q111 Q311 Q112 Q312 Q113 Q313 Q114…
  20. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 20
    Outlook For Energy Markets NE Supply Reflects Increased Takeaway Capacity Bcf/d 17.0 16.0 New pipeline capacity comes online 15.0 14.0 13.0 12.0 Weather induced freeze offs 11.0 Aug'13 Sep'13 Nov'13 Dec'13 Feb'14 Apr'14…
  21. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 21
    Outlook For Energy Markets Gas Producers Catch Up On Hedging % US/Canadian Gas Production Hedged By End Q1 70% Current Calendar Year Current Calendar Year + 1 60% 50% 40% 30% 20% 10% 0% 2009 2010 2011 2012 2013 2014 *…
  22. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 22
    Outlook For Energy Markets Winter Spike Aside, Gas Bound By CAPP Pricing Avg Gas/Coal Competition Economics /mmbtu NYMEX Henry Hub 6.0 Most Relevant Marginal Price 5.5 5.0 4.5 Range of prices where Central Appalachian coal…
  23. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 23
    Outlook For Energy Markets Gas, Renewables Dominate Power Gen Additions Net Capacity Chg In Power Gen By Fuel Source Gigawatts 2012 450 2020 400 350 300 250 200 150 100 50 0 Coal Gas Solar Wind Other CIBC Commodities…
  24. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 24
    Outlook For Energy Markets US Export Policy No Longer Obstacle For LNG Cumulative Capacity of Approved LNG Facilities By Scheduled Start Up Date Bcf/d 20 US 18 Canada 16 14 12 10 8 6 4 2 0 2015 2016 2017 2018 2019 2020…
  25. AUGUST 2014 INVESTOR PRESENTATION – CIBC – slide 25
    Outlook For Energy Markets CIBC MACRO STRATEGY RESEARCH Credit Foreign Exchange Commodities Joanna Zapior, CFA Jeremy Stretch Katherine Spector +1 (416) 594-8498 +44 (0) 207 234-7232 +1 (212) 885-4339 joanna.zapiorcibc.com…

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