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Q2 2015 Earnings Call – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Aug 5, 2015 · 35 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. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 1
    Pioneer Proprietary Q2 2015 Earnings August 5, 2015
  2. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 2
    Financial and Operating Highlights Q2 2015 adjusted income: 15 MM, or 0.10 per diluted share1 Q2 2015 production of 197 MBOEPD (51% oil) reflected: Strong Spraberry/Wolfcamp production growth driven by successful horizontal drilling…
  3. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 3
    Financial and Operating Highlights (cont.) 28 horizontal wells placed on production during Q2 2015 in the northern Spraberry/Wolfcamp Early production results from 16 wells in the Wolfcamp B interval are on average tracking EURs…
  4. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 4
    Outlook Strong commodity derivatives positions continue to protect cash flow Derivative coverage for forecasted oil production of 90% for 2015 and 75% for 2016 o Most 2015 volumes protected by swaps at 71 per barrel o 3-way collars…
  5. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 5
    2015E Capital Spending and Cash Flow1 Capital program of 2.2 B (includes rig adds in 2H) Drilling Capital: 1.95 B 1,400 MM northern Spraberry/Wolfcamp (65% of total) o 1,035 MM for horizontal drilling program Sensitivity to Forward…
  6. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 6
    Targeting 15%+ Compound Annual Production Growth for 2016 - 20181 200+ MBOEPD2 205-210 194 197 182 Impacted by severe weather in Q1 and Q2 and FY ethane rejection2 2014 Q1 Q2 Q3E Q4E 2016E 2017E 2018E 48% Oil 51% Oil 51%…
  7. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 7
    Strong Performance from Q2 Northern Spraberry/Wolfcamp Wells Placed on Production 28 horizontal wells placed on production during Q2 Majority were Wolfcamp B and Lower Spraberry Shale wells o Early production results from 16 wells in…
  8. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 8
    Northern Wolfcamp Horizontal Production Data1 Wolfcamp A Average production from all Wolfcamp A and B Wolfcamp A wells (28) Updated End July 300 avg. lateral: 7,750 feet2 interval wells drilled since 2013 in northern Cumulative…
  9. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 9
    Northern Spraberry/Wolfcamp: Increasing 2015 Horizontal Drilling Activity Plan to add 2 horizontal rigs per month from July through Q1 2016 Pioneers Northern Spraberry/Wolfcamp 2015 Drilling Areas Currently running 10 rigs 2015 Plan…
  10. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 10
    Southern Wolfcamp JV: High-Grading Drilling Activity in 2015 Currently operating 4 horizontal rigs Pioneers Southern Wolfcamp JV Area Drilling program delivering strong EURs and 2015 Drilling Areas returns as a result of cost…
  11. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 11
    Horizontal Drilling Driving Spraberry/Wolfcamp Production Growth Spraberry/Wolfcamp Net Production (MBOEPD)1 Expect to deliver production growth trajectory similar to 2H 2014 in response to increasing horizontal rig count and…
  12. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 12
    Tank Battery/Salt Water Disposal (SWD) Facilities New larger-scale tank batteries and SWD facilities allow 75% of PXDs 1 Section optimized horizontal field development by utilizing pad acreage allows for drilling and centralized…
  13. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 13
    Southern Wolfcamp JV Benefiting from Centralized Tank Batteries Giddings tank battery/SWD constructed in early 2014 and designed to initially handle 6 wells (two 3-well pads) at a cost of 10 MM Horizontal Tank Battery/SWD Over the…
  14. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 14
    Economics Support Centralized Tank Battery/SWD Design Centralized tank batteries supporting 3-well pad drilling maximize NPV for horizontal development of Pioneers large 800,000 gross acreage position compared to other development…
  15. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 15
    Spraberry/Wolfcamp Water Distribution System Long-term plan calls for construction of a field-wide water distribution system to reduce the cost of water for drilling and completion activities and to ensure adequate supplies of…
  16. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 16
    Other Spraberry/Wolfcamp Infrastructure Gas Processing Pioneers 27% interest in Targas West Texas system and 30% interest in the WTG Sale Ranch plant improves contract terms, ensures timely hook-up of new wells Gas Processing Plant…
  17. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 17
    Continued Strong Drilling Results in Karnes and DeWitt Counties Eagle Ford Shale drilling activity focused in areas JV Acreage Central Gathering Plant Pipeline Infrastructure with highest EURs - Karnes and DeWitt counties 6 Month…
  18. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 18
    Eagle Ford Shale 2015 Production Outlook Eagle Ford Shale Net Production (MBOEPD)1 33 horizontal wells placed on production in Q2 47 MBOEPD 16 upper targets and 17 lower targets POPd 49 wells through end June 46 47 46 Q2 production…
  19. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 19
    Q2 2015 Earnings Summary Millions Per Diluted (After Tax) Share Net loss attributable to common stockholders (218) (1.46) Noncash mark-to-market (MTM) derivative losses (347 MM before tax) 222 1.48 Adjusted income excluding noncash MTM…
  20. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 20
    Price Realizations Realized Prices 95.87 90.82 66.64 51.64 43.02 30.24 28.44 4.33 3.79 3.60 18.50 15.00 14.03 2.70 2.37 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Q2 14 Q3 14 Q4 14 Q1 15 Q2 15 Oil…
  21. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 21
    Production Costs (per BOE) Q2 2015 production costs 13.90 13.17 13.61 decreased 11% compared to Q1 Workovers 0.59 0.63 0.65 12.56 2015 Production & 0.62 11.19 Ad Valorem 3.52 2.78 LOE decreased due to cost reduction Taxes 3.35…
  22. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 22
    Liquidity Position (06/30/15) Net debt (net of cash balance of 219 MM) 2.5 B Excludes EFS Midstream sale proceeds of 530 MM received in July 2015 (remaining 500 MM of proceeds to be received in July 2016) Unsecured credit facility…
  23. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 23
    Q3 2015 Guidance Guidance Daily Production (MBOEPD) 205 210 Production Costs (/BOE) 11.50 13.50 Exploration & Abandonment ( MM) 25 35 Drilling and Acreage 5 - 10 Personnel and Seismic 20 - 25 DD&A (/BOE) 18.00 20.00 G&A (…
  24. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 24
    2015 Drilling Capital1 Millions 1,950 489 416 Q1 '15 Q2 '15 FY '15E 1) Excludes acquisitions, asset retirement obligations, capitalized interest and geological and geophysical G&A expenditures 26
  25. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 25
    Pioneers Production By Commodity By Area Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 Spraberry/Wolfcamp Oil (BOPD) 57,893 66,425 76,894 74,538 77,735 NGL (BOEPD) 19,754 21,734 23,956 19,760 22,627 Gas (MCFPD) 83,368 86,412 87,630 104,519…
  26. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 26
    Oil and Gas Revenue Millions 938 967 804 596 517 Q2 '14 Q3 '14 Q4 '14 Q1 '15 Q2 '15 28
  27. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 27
    Open Commodity Derivative Positions as of 08/03/15 Oil Q3 2015 Q4 2015 2016 2017 Swaps - WTI (BPD) 82,000 82,000 - - NYMEX WTI Price (/BBL) 71.18 71.18 - - Three Way Collars (BPD)1,2 15,000 15,000 100,514 15,000 NYMEX Call…
  28. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 28
    Open Commodity Derivative Positions as of 08/03/15 Ethane Q3 2015 Q4 2015 2016 2017 Swaps (BPD)1 6,000 6,000 5,000 - Mont Belvieu Swap Price (/BBL) 7.80 7.80 11.61 - Propane Q3 2015 Q4 2015 2016 2017 Swaps (BPD)2 11,000…
  29. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 29
    Open Commodity Derivative Positions as of 08/03/15 Gas Q3 2015 Q4 2015 2016 2017 Swaps (MMBTUPD) 20,000 20,000 70,000 - NYMEX Price (/MMBTU)1 4.31 4.31 4.06 - Three Way Collars (MMBTUPD)1,2 285,000 285,000 180,000 - NYMEX Call…
  30. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 30
    General & Administrative Costs Millions 89 82 81 82 83 15 14 16 15 18 Noncash Q2 Q3 Q4 Q1 Q2 2014 2014 2014 2015 2015 32
  31. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 31
    Interest Costs Millions 47 46 46 46 46 5 4 4 5 4 Noncash Q2 Q3 Q4 Q1 Q2 2014 2014 2014 2015 2015 33
  32. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 32
    Exploration & Abandonments ( Millions) Drilling, Acreage & Other Abandonments 10 Geological & Geophysical Seismic 4 Personnel & Other 14 2nd Quarter Total 28 34
  33. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 33
    Income Taxes Attributable to Continuing Operations Quarter Ended June 30, 2015 ( Millions) Current tax provision (1) Deferred tax benefit 124 Income tax benefit 123 35
  34. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 34
    Supplemental Non-GAAP Financial Measures EBITDAX and discretionary cash flow (DCF) are disclosed by Pioneer, and reconciled to the generally accepted accounting principle (GAAP) measures of net loss and net cash provided by operating…
  35. Q2 2015 Earnings Call – Pioneer Natural Resources Co. – slide 35
    Supplemental Non-GAAP Financial Measures Adjusted income excluding noncash MTM derivative losses and adjusted net income excluding noncash MTM derivative losses and unusual items, as presented in the Financial and Operating Highlights…

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