Skip to main content Howard Weil Energy Conference – Devon Energy Corp Investor Presentation | Shale Experts
Loading...
Pm

Howard Weil Energy Conference – Devon Energy Corp

Devon Energy Corp · Mar 26, 2012 · 46 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. Howard Weil Energy Conference – Devon Energy Corp – slide 1
    Howard Weil Energy Conference March 26, 2012
  2. Howard Weil Energy Conference – Devon Energy Corp – slide 2
    NYSE: DVN www.devonenergy.com Slide 3 Devon Today Proved reserves: ? 3.0 billion BOE (42% liquids) Current production: ? 680 MBOED (Q4 2011) Sales revenue mix: 45% oil 36% NGLs 19% natural gas (Q4 2011) Significant midstream…
  3. Howard Weil Energy Conference – Devon Energy Corp – slide 3
    NYSE: DVN www.devonenergy.com Slide 4 Devon?s Strengths Per share focus Emphasis on capital discipline Superior financial strength Strong full-cycle margins Deep inventory of oil and liquids-rich opportunities
  4. Howard Weil Energy Conference – Devon Energy Corp – slide 4
    NYSE: DVN www.devonenergy.com Slide 5 Organizational focus on per share results Capital Allocation Criteria Optimize per share returns on a debt-adjusted basis through: ? E&P capital projects ? Debt reduction ? Share repurchases ?…
  5. Howard Weil Energy Conference – Devon Energy Corp – slide 5
    NYSE: DVN www.devonenergy.com Slide 6 2011 - Completed $3.5 billion share buyback program Repurchased 116 million shares since 2004 ? Represents > 20% of outstanding common stock 2012 - Increased quarterly dividend 18% to $0.20 per…
  6. Howard Weil Energy Conference – Devon Energy Corp – slide 6
    NYSE: DVN www.devonenergy.com Slide 7 Financial Strength & Flexibility Cash and short-term investments: $7.1 billion Net debt-to-cap ratio: 11% Senior unsecured ratings: ? Fitch: BBB+ ? Moody?s: Baa1 ? S&P: BBB+ Note: Includes a…
  7. Howard Weil Energy Conference – Devon Energy Corp – slide 7
    NYSE: DVN www.devonenergy.com Slide 8 2012 E&P Capital Allocation Jackfish Other Canada $5.1 ? $5.5 Billion 10% 90% Development activity Exploration activity ($225 million for acreage) ?100% of capital allocated towards oil…
  8. Howard Weil Energy Conference – Devon Energy Corp – slide 8
    NYSE: DVN www.devonenergy.com Slide 9 2012 Capital Objectives Development of existing inventory Oil and natural gas liquids growth: 17% - 19% (Oil growth: >20%; NGL growth: teens) Top-line production growth: ?6% Accelerate testing…
  9. Howard Weil Energy Conference – Devon Energy Corp – slide 9
    NYSE: DVN www.devonenergy.com Slide 10 Devon?s Recycle Ratio North America Onshore $ Per BOE Revenue (excluding hedges) $ 36.90 Cash costs (1) (12.78) Midstream capital (1.39) Cash margin per BOE $ 22.73 3-yr drilling F&D…
  10. Howard Weil Energy Conference – Devon Energy Corp – slide 10
    NYSE: DVN www.devonenergy.com Slide 11 129% 124% 151% 162% 180% 177% 176% 65% Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Recycle Ratio Excluding Hedges Note: Peer group includes APA, APC, CHK, ECA, EOG, NBL and NFX Source:…
  11. Howard Weil Energy Conference – Devon Energy Corp – slide 11
    NYSE: DVN www.devonenergy.com Slide 12 Jackfish Projects Overview SAGD Development Jackfish acreage (100% WI) >15m (?50ft) continuous bitumen pay Ft. McMurray Edmonton Calgary ALBERTA BRITISH COLUMBIA Jackfish & Pike Each…
  12. Howard Weil Energy Conference – Devon Energy Corp – slide 12
    NYSE: DVN www.devonenergy.com Slide 13 Note: Industry average includes: Bolney-Celtic, Christina Lake, Firebag, Foster Creek, Great Divide, Hangingstone, Hilda Lake, Long Lake, MacKay River, Orion, Senlac, Surmont, Tangleflags, and…
  13. Howard Weil Energy Conference – Devon Energy Corp – slide 13
    NYSE: DVN www.devonenergy.com Slide 14 Pike SAGD Development Pike joint venture leasehold: ? 50% operated working interest ? Similar reservoir characteristics to Jackfish ? Up to five SAGD development phases Pike 1 development…
  14. Howard Weil Energy Conference – Devon Energy Corp – slide 14
    NYSE: DVN www.devonenergy.com Slide 15 SAGD Development Timeline Timing Range of Expected Plant Start-Up Jackfish 1 (35 MBOD) Jackfish 2 (35 MBOD) Jackfish 3 (35 MBOD) Jackfish East (20-25 MBOD) Pike 1A (35 MBOD) Pike 1B (35…
  15. Howard Weil Energy Conference – Devon Energy Corp – slide 15
    NYSE: DVN www.devonenergy.com Slide 16 Thermal Oil Production Growth Outlook Net Barrels Per Day 43,000 Q4 2011 2020 150,000 175,000 17% CAGR 19% CAGR Net risked resource: ? 1.4 BBO
  16. Howard Weil Energy Conference – Devon Energy Corp – slide 16
    NYSE: DVN www.devonenergy.com Slide 17 Devon?s Thermal Position Summary Top-tier oil sands position Approximately 1.4 billion net recoverable barrels Jackfish project: Industry-leading project performance Natural hedge to North…
  17. Howard Weil Energy Conference – Devon Energy Corp – slide 17
    NYSE: DVN www.devonenergy.com Slide 18 Permian Basin Overview Oil & Liquids-Rich Opportunities Eastern Shelf Midland Basin Northwestern Shelf Central Basin Platform Ozona Arch Diablo Platform Delaware Basin New Mexico…
  18. Howard Weil Energy Conference – Devon Energy Corp – slide 18
    NYSE: DVN www.devonenergy.com Slide 19 Permian Basin 2012 Activity Eastern Shelf Midland Basin Northwestern Shelf Central Basin Platform Ozona Arch Diablo Platform Delaware Basin New Mexico Texas Midland Balanced…
  19. Howard Weil Energy Conference – Devon Energy Corp – slide 19
    NYSE: DVN www.devonenergy.com Slide 20 Cana Woodford Shale Liquids-Rich Gas Development Risked locations: > 5,000 Net risked resource: ? 11 TCFE Net acreage: 244,000 Low cost of entry: ? $2,200/acre Low average royalty burden: 20%…
  20. Howard Weil Energy Conference – Devon Energy Corp – slide 20
    NYSE: DVN www.devonenergy.com Slide 21 Barnett Shale Liquids-Rich Gas Development Parker Palo Pinto Hood Tarrant Johnson Erath Hill Jack Wise Denton Ft. Worth Denton Net acreage: 625,000 Low average acreage cost: ?…
  21. Howard Weil Energy Conference – Devon Energy Corp – slide 21
    NYSE: DVN www.devonenergy.com Slide 22 Canadian Exploration Oil & Liquids-Rich Opportunities Deep Basin Lower Cretaceous zones (liquids-rich gas) Ferrier Area Cardium (light oil) Kindersly Area Viking (light oil) Exposure to…
  22. Howard Weil Energy Conference – Devon Energy Corp – slide 22
    NYSE: DVN www.devonenergy.com Slide 23 New Ventures Assembled 1.4 million net acres (Five high-impact plays) Targeting oil and liquids-rich opportunities Low acreage costs and low royalty rates Early stages of evaluation 2011/2012…
  23. Howard Weil Energy Conference – Devon Energy Corp – slide 23
    NYSE: DVN www.devonenergy.com Slide 24 New Ventures Plays Location Oil and gas in shale and carbonate zones Oil and gas in silica rich shale zone Oil in carbonate rich shale zone Oil in matrix and fractured carbonate zone…
  24. Howard Weil Energy Conference – Devon Energy Corp – slide 24
    NYSE: DVN www.devonenergy.com Slide 25 Sinopec Agreement Announced: 1/3/12 Sinopec acquires 33% of Devon?s interest in 1.4 million net acres across five new venture plays Transaction price: $2.5 billion ? $900 million cash payment…
  25. Howard Weil Energy Conference – Devon Energy Corp – slide 25
    NYSE: DVN www.devonenergy.com Slide 26 Sinopec Agreement Rationale Reduces capital requirements Improves capital efficiency Accelerates de-risking and commercialization Mitigates exploration risk Provides additional flexibility to…
  26. Howard Weil Energy Conference – Devon Energy Corp – slide 26
    NYSE: DVN www.devonenergy.com Slide 27 Why Own Devon? Per share focus Emphasis on capital discipline Superior financial strength Strong full-cycle margins Deep inventory of oil and liquids-rich opportunities
  27. Howard Weil Energy Conference – Devon Energy Corp – slide 27
    YSE: DVN www.devonenergy.com Slide 30 2012 Hedged Position Oil Hedges Full-Year 2012 54,000 BOD collared: $86 floor and $126 ceiling 22,000 BOD swapped at $107 19,500 BOD of call options sold at $95 Natural Gas Hedges Full-Year…
  28. Howard Weil Energy Conference – Devon Energy Corp – slide 28
    NYSE: DVN www.devonenergy.com Slide 31 Expected Proceeds BP - Brazil $3.2 Q2 2011 BP ? Deepwater GOM $1.8 Q2 2010 Apache ? GOM Shelf $1.1 Q2 2010 CNOOC, CVX, BP ? China $0.6 Q2 & Q3 2010 Maersk - Deepwater GOM $1.3 Q1 2010 BP -…
  29. Howard Weil Energy Conference – Devon Energy Corp – slide 29
    NYSE: DVN www.devonenergy.com Slide 32 Historical Performance North American Onshore 240 223 168 220 207 183 2006 2007 2008 2009 2010 2011 233% 198% 269% 223% 175% 160% 2006 2007 2008 2009 2010 2011 $13.57$13.30$13.05…
  30. Howard Weil Energy Conference – Devon Energy Corp – slide 30
    NYSE: DVN www.devonenergy.com Slide 33 Devon?s Thermal Oil Position SAGD Development Ft. McMurray Edmonton Calgary ALBERTA BRITISH COLUMBIA Jackfish & Pike Devon?s SAGD characteristics: ? Low F&D ? Low geologic risk ? High…
  31. Howard Weil Energy Conference – Devon Energy Corp – slide 31
    NYSE: DVN www.devonenergy.com Slide 34 Jackfish East Additional SAGD Potential Jackfish acreage (100% WI) >15m (?50ft) continuous bitumen pay Ft. McMurray Edmonton Calgary ALBERTA BRITISH COLUMBIA Jackfish & Pike 1 Mile…
  32. Howard Weil Energy Conference – Devon Energy Corp – slide 32
    NYSE: DVN www.devonenergy.com Slide 36 Iron River Manatokan End Lake Lloydminster Lloydminster Oil Development Low-risk development Strong operating margins Q4 2011 net production: ?39 MBOED 2012 plans: ?150 wells Risked…
  33. Howard Weil Energy Conference – Devon Energy Corp – slide 33
    NYSE: DVN www.devonenergy.com Slide 36 Iron River Manatokan End Lake Lloydminster Lloydminster Oil Development Low-risk development Strong operating margins Q4 2011 net production: ?39 MBOED 2012 plans: ?150 wells Risked…
  34. Howard Weil Energy Conference – Devon Energy Corp – slide 34
    NYSE: DVN www.devonenergy.com Slide 37 Granite Wash Oil & Liquids-Rich Development Net acreage: 63,000 Legacy land position held by production Low average royalty burden: 19% Q4 2011 net production: 19 MBOED Liquids drive superior…
  35. Howard Weil Energy Conference – Devon Energy Corp – slide 35
    NYSE: DVN www.devonenergy.com Slide 38 Devon?s North American Shale Position Low cost of entry and low royalty rates Minimal term acreage expirations High liquids content Economics enhanced by midstream business Multi-year growth…
  36. Howard Weil Energy Conference – Devon Energy Corp – slide 36
    NYSE: DVN www.devonenergy.com Slide 39 U.S. Shale Gas Production Major Shale Plays Sources: EIA, IHS
  37. Howard Weil Energy Conference – Devon Energy Corp – slide 37
    NYSE: DVN www.devonenergy.com Slide 40 Devon?s 30-Day IP Trend Barnett Shale Horizontal Wells 0 500 1,000 1,500 2,000 2005 2006 2007 2008 2009 2010 MCFED Year of 1st Production Note: Average daily rate for the best month in the…
  38. Howard Weil Energy Conference – Devon Energy Corp – slide 38
    NYSE: DVN www.devonenergy.com Slide 41 Barnett Shale Performance Reserve Revisions 2010 +154 2009 +288 2005 +378 2006 +24 2007 +234 2011 +30 2008 +132 2004 +186 Performance Reserve Year Revisions (BCFE)
  39. Howard Weil Energy Conference – Devon Energy Corp – slide 39
    NYSE: DVN www.devonenergy.com Slide 42 Barnett Drilling Density Johnson County Johnson county net acreage: 119,000 Drilled ? 700 horizontal wells to date Devon Acreage Devon Well Cities Lakes Industry Well Cleburne Alvarado…
  40. Howard Weil Energy Conference – Devon Energy Corp – slide 40
    NYSE: DVN www.devonenergy.com Slide 43 East Texas Unconventional Haynesville / Bossier Shale Net prospective acres: >100,000 Significant portion of acreage held by production or fee Low average royalty…
  41. Howard Weil Energy Conference – Devon Energy Corp – slide 41
    Horn River Basin Net acreage: 174,000 Natural gas shale play Thickest section of the basin Minimal drilling required to hold acreage Risked locations: 1,600 Net risked resource: 10 TCFE 94-O-7 94-O-9 94-O-15 94-O-16 94-O-10…
  42. Howard Weil Energy Conference – Devon Energy Corp – slide 42
    NYSE: DVN www.devonenergy.com Slide 45 Arkoma Woodford Shale Net acreage: 42,000 Low cost of entry: ? $400/acre Low average royalty burden: 19% Acreage held by production Q4 2011 net production: 68 MMCFED Strategic midstream…
  43. Howard Weil Energy Conference – Devon Energy Corp – slide 43
    NYSE: DVN www.devonenergy.com Slide 46 Carthage Field Waskom Bethany Angelina San Augustine Sabine Shelby Rusk Panola Gregg Harrison Marion Upshur Camp Cass Texas Appleby Net acreage: 199,000 Working interest: 86% Q4…
  44. Howard Weil Energy Conference – Devon Energy Corp – slide 44
    NYSE: DVN www.devonenergy.com Slide 47 Groesbeck Net acreage: 146,000 Working interest: 72% Q4 2011 net production: 83 MMCFED Nan-Su-Gail Dew Bald Prairie Personville Oaks Limestone Freestone Leon Robertson Texas OK TX…
  45. Howard Weil Energy Conference – Devon Energy Corp – slide 45
    NYSE: DVN www.devonenergy.com Slide 48 Washakie Net acreage: 157,000 Working interest: 76% Q4 2011 net production: 136 MMCFED Low-risk, tight sand gas WY UT CO Washakie
  46. Howard Weil Energy Conference – Devon Energy Corp – slide 46
    NYSE: DVN www.devonenergy.com Slide 49 Access Pipeline EDMONTON HARDISTY Enbridge P/L To Midwest Express P/L To U.S. Rockies Terasen P/L To Pacific NW ACCESS PIPELINE Athabasca Enbridge P/L IPF Cold Lake IPF Cold Lake…

From the store

Browse maps, data & reports in the Shale Experts store