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August 2015 Investor Presentation – Cimarex Energy Co.

Cimarex Energy Co. · Aug 10, 2015 · 36 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 2015 Investor Presentation – Cimarex Energy Co. – slide 1
    August 2015 1
  2. August 2015 Investor Presentation – Cimarex Energy Co. – slide 2
    Who is Cimarex Market cap......... permian midcontinent 9.9B Debt/Adj. EBITDA1........ 1.2x Production (2Q15)..... 1.0 Bcfe/d Proved reserves..... 3.1 Tcfe % Natural gas..... 53% % Proved developed..... 77% R/P Ratio.....…
  3. August 2015 Investor Presentation – Cimarex Energy Co. – slide 3
    Whats Important Our balanced portfolio of assets Premier position in the Delaware Basin and MidCon region Provides flexibility through commodity cycles Idea generation and track record of strong execution Strong financial…
  4. August 2015 Investor Presentation – Cimarex Energy Co. – slide 4
    Sound Decisions = Solid Growth Proved Reserves Daily Production (Bcfe) (MMcfe) +1013% 3,500 1,000 960980 3,132 869 3,000 425 2,497 750 2,500 693 2,259 343 2,000 500 1,500 444 1,000 350 0.7x 0.6x 0.6x 250 500 0 0 2012…
  5. August 2015 Investor Presentation – Cimarex Energy Co. – slide 5
    Regional Diversity Provides Flexibility Second Quarter 2015 Production Mix Permian Basin MidContinent 6
  6. August 2015 Investor Presentation – Cimarex Energy Co. – slide 6
    2015 E&D Investment Plan Post Equity Offering Drilling & Completion Capital Total: 1.0 billion 790mm Drilling & completion capital increased 100mm Spud Culberson Wolfcamp A downspacing pilot in 4Q Bone Spring & Meramec see more…
  7. August 2015 Investor Presentation – Cimarex Energy Co. – slide 7
    2016 How it looks today Capital Allocation* Sixteen rigs in Sixteen Drilling & Completion Multiple projects/multiple zones Delaware Basin Begin Wolfcamp C/D development in Culberson County Continue Wolfcamp A pilot Bone Spring…
  8. August 2015 Investor Presentation – Cimarex Energy Co. – slide 8
    ApplestoApples Well Design Total Well Cost Reduction Culberson Wolfcamp D Woodford Infill Well 10,000foot lateral 5,000foot lateral 20% 30% *2014 peak well cost calculated using current well design 9
  9. August 2015 Investor Presentation – Cimarex Energy Co. – slide 9
    Biggest Opportunity Delaware Basin Wolfcamp 235,000 net acres in the fairway Multiple Wolfcamp Targets Culberson/White City Area 100,000+ net acres Wolfcamp A, C & D JDA with Chevron Reeves County 80,000 net acres Wolfcamp A &…
  10. August 2015 Investor Presentation – Cimarex Energy Co. – slide 10
    Culberson Area Details 100,000 net 100,000+ netacres; acresJDA with Chevron 2013 main objectives 11 Wolfcamp D long laterals Drilling to hold acreage Avg. 30day peak IP of 2,255 Wolfcamp BOE/d (25% C oil; & D45% gas; 30% Two…
  11. August 2015 Investor Presentation – Cimarex Energy Co. – slide 11
    Long Lateral Performance Culberson Wolfcamp D Eleven 10,000foot laterals 350 Cumulative Production Average 30day peak IP of 2,255 (MBOE) 300 BOE/d (25% oil; 45% gas; 30% NGL) 250 52% Increase 200 150 100 50 0 0…
  12. August 2015 Investor Presentation – Cimarex Energy Co. – slide 12
    Long Laterals provide Upsized Returns Culberson County Wolfcamp D 3000 5,000 ft. 10,000 ft. BOE/day lateral lateral 2500 Well Cost (MM) 7.1 11.5 BTAX IRR 48% 78% NPV10 (MM) 5.2 14.1 2000 Assumptions: Oil 50/Bbl; Gas 3.00/Mcf; NGL…
  13. August 2015 Investor Presentation – Cimarex Energy Co. – slide 13
    Sensitivity to Crude Oil Prices Culberson County Wolfcamp D BTax IRR Strip dated: 7/20/15 139% 106% 90% 78% 68% 57% 37% 48% 32% 19% 10,000 ft. lateral; 43 stages 5,000 ft. lateral; 20 stages 30 40 50 60 70…
  14. August 2015 Investor Presentation – Cimarex Energy Co. – slide 14
    Culberson County Downspacing Pilot Results Two fourwell pilots; 5,000ft laterals Barbaro Pilot 80acre spacing (8 wells/section) 20stage completion; 1,200 lbs/foot PrewitOmaha Pilot 107acre spacing (6 wells/section) 16stage…
  15. August 2015 Investor Presentation – Cimarex Energy Co. – slide 15
    Culberson County Wolfcamp C/D Development Foursection infill development Sunday Silver Silence Charm 1.5 mile sections (7,500foot laterals) Stacked/staggered well pattern Southern sections spud in January Three miles Four rigs…
  16. August 2015 Investor Presentation – Cimarex Energy Co. – slide 16
    Upsized Frac Improves Second Bone Spring Results White City Area 180 Cumulative Production (MBOE) Focus Area 160 140 120 64% Increase 100 80 60 15 wells with average 30day peak IP of 1,344 BOE/d* (910 bo/d) 40 15…
  17. August 2015 Investor Presentation – Cimarex Energy Co. – slide 17
    2015 Activity in Reeves & Ward Counties Reeves County 7 Wolfcamp A 10kft. laterals Average 30day peak IP of 1,646 BOE/d (50% oil; 28% gas; 22% NGL) Best well in Upper A zone Big Timber well has avg. 30day peak IP of 3,309 BOE/d…
  18. August 2015 Investor Presentation – Cimarex Energy Co. – slide 18
    Delaware Basin Avalon Shale: Spacing Pilots Four spacing pilots; 18 total wells Testing 6 & 8 wells/section Average 30day peak rate of 1,012 BOE/d (70% oil; 17% gas; 13% NGL) 250 locations Includes Avalon and Leonard Assumes…
  19. August 2015 Investor Presentation – Cimarex Energy Co. – slide 19
    MidContinent Woodford Shale Opportunity CanaWoodford Activity Map 2015 capex of 190mm Strong results at Haley infill Avg. 30day peak IP of 10.3 Operated Well Nonoperated Well MMcfe/d (55% gas; 18% oil; 27% NGL) Row 4 completions…
  20. August 2015 Investor Presentation – Cimarex Energy Co. – slide 20
    Performance of Upsized Fracs in CanaWoodford Core (MMcfe/d) Golden Section 12 10 Haley Section 10.2 8.7 10.3 8.8 8.2 9.2 Hartz Section 8 30day IP 6 Days 3060 Days 6090 4 90 day average 2 0 Golden Hartz Haley Oil…
  21. August 2015 Investor Presentation – Cimarex Energy Co. – slide 21
    Meramec: The Big Picture Ten Meramec wells to date w/ avg. 30day peak IP of 9.3 MMcfe/d Oil yield ranges from15 Bbl/MMcf Updip to 332 Bbl/MMcf Downdip Next Steps Test long laterals Highgrade frac design Spacing pilots 115,000…
  22. August 2015 Investor Presentation – Cimarex Energy Co. – slide 22
    Wellpositioned for 2015 and Beyond Strong financial position Diverse asset portfolio with good returns Flexibility to adapt to any commodity environment Emphasis on improved productivity 23 23
  23. August 2015 Investor Presentation – Cimarex Energy Co. – slide 23
    2015 Guidance 2015 Production, Unit Expense and Capital Guidance Third Quarter FullYear Production* Total Equivalent (Mmcfe/d) 920940 960980 % Liquids 53% 53% Expenses (/Mcfe): Production 0.90 1.05 Transportation, processing &…
  24. August 2015 Investor Presentation – Cimarex Energy Co. – slide 24
    Hedges Gas Weighted Average Price (1) Period Index Type MMBTU/d Floor Ceiling Jan. - Dec. '16 PEPL Collar 10,000 2.70 2.85 (1) PEPL refers to Panhandle Eastern Pipe Line Tex/OK Mid-Continent index, as quoted in Platts Inside…
  25. August 2015 Investor Presentation – Cimarex Energy Co. – slide 25
    Cana Area Production MMcfe/day 450 406 400 384 350 350 333 310 300 255 250 229 226 215 216 217 200 184 161 156 150 100 50 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Gas NGL…
  26. August 2015 Investor Presentation – Cimarex Energy Co. – slide 26
    Permian Basin Production MBOE/day 100 99 90 81 80 74 70 68 65 60 59 58 55 53 50 49 46 46 40 41 40 30 20 10 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Oil NGL Gas 28…
  27. August 2015 Investor Presentation – Cimarex Energy Co. – slide 27
    Strong Performance from Key Culberson Wolfcamp Wells Shallow Decline of Upsized Fracs (BOE/d) Wolfcamp D Wolfcamp A 3,000 1,600 30day IP Days 3060 2,450 2,500 Days 6090 2,500 1,200 1,250 1,095 90 day average 2,000 1,365 1,500…
  28. August 2015 Investor Presentation – Cimarex Energy Co. – slide 28
    Permian Region Provides Multiple Opportunities Multiple projects/multiple zones Wolfcamp shale (oil & gas) Bone Spring sands (oil) Avalon Shale (oil window) 2015 Focus Wolfcamp Long Laterals Meeting acreage obligations White City…
  29. August 2015 Investor Presentation – Cimarex Energy Co. – slide 29
    Thick, Multipay Wolfcamp Section Culberson Area Reeves County Ward County 100,000 net acres 80,000 net acres 38,000 net acres IIndicates producing zone. 31 31
  30. August 2015 Investor Presentation – Cimarex Energy Co. – slide 30
    Culberson County Wolfcamp Pilots Stacked Lateral Test 80acre Spacing Pilot Wolfcamp C & D Wolfcamp D Two wells Four wells Producing/Evaluating Producing/Evaluating 32 32
  31. August 2015 Investor Presentation – Cimarex Energy Co. – slide 31
    Reeves County Wolfcamp Pilots 80acre Spacing Pilot Stacked/Staggered Spacing Pilot Wolfcamp A Wolfcamp A Four wells Six wells Producing/Evaluating Flowing Back 33 33
  32. August 2015 Investor Presentation – Cimarex Energy Co. – slide 32
    Upsized Wolfcamp Frac Old Frac Design: 5,000foot lateral; 12 stages; 4mm lbs of sand New Frac Design: 5,000foot lateral; 20 stages; 6mm lbs of sand 34
  33. August 2015 Investor Presentation – Cimarex Energy Co. – slide 33
    Reeves County Stacked/Staggered Spacing Pilot Six infill wells plus parent well Upper A infill wells Produce at higher rates Avg. IP of 1,068 BOE/d Lower A infill wells Avg. IP of 761 BOE/d Carbonate in landing zone made wells…
  34. August 2015 Investor Presentation – Cimarex Energy Co. – slide 34
    Stacked/Staggered Pilot Reeves County Wolfcamp A BOE/day 1,200 Upper Wells Lower Wells 1,000 800 30day IP Days 3060 600 Days 6090 Days 90120 400 200 0 % Oil 59% 58% 59% 57% 56% 49% 50% 43% 36 36
  35. August 2015 Investor Presentation – Cimarex Energy Co. – slide 35
    NonGAAP Reconciliation Reconciliation of Net Income to EBITDA and Adjusted EBITDA ( in Millions) 2012 2013 2014 LTM Net income (loss) 354 565 507 (795) Income tax expense (benefit) 207 329 299 (442) Interest expense, net of…
  36. August 2015 Investor Presentation – Cimarex Energy Co. – slide 36
    NonGAAP Reconciliation Reconciliation of cash flow from operations Debt/Cap Calculation Three months June 30, Ended June 30 2015 2015 2014 (in millions) (in millions) Long-term debt 1,500 Net cash provided by operating activities…

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