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IPAA Oil and Gas Investment Symposium – Devon Energy Corp

Devon Energy Corp · Apr 13, 2010 · 37 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. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 1
    April 13, 2010 IPAA Oil and Gas Investor Symposium
  2. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 2
    NYSE: DVN www.devonenergy.com Slide 3 Devon Today North America Onshore Proved reserves (12/31/09): ? 2.6 Billion BOE Current production (Q4 2009): ? 573 MBOED Reserve mix (12/31/09): 59% gas Production mix (Q3 2009): 41% liquids…
  3. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 3
    NYSE: DVN www.devonenergy.com Slide 4 Gas Gathering & Processing Profitable midstream enhances operational effectiveness Ownership in more than 13,000 miles of pipelines ? > 6,000 Domestic ? > 7,000 Canada Ownership in 64 plants ?…
  4. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 4
    NYSE: DVN www.devonenergy.com Slide 5 Recent Announcement November 16, 2009 Devon announces plan to strategically reposition company as high-growth, onshore North American exploration and production company.
  5. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 5
    NYSE: DVN www.devonenergy.com Slide 6 Strategic Rationale Extensive resource capture since 2000 Accelerate value realization through monetization and redeployment Compete where we are most competitive Focus on areas with highest…
  6. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 6
    NYSE: DVN www.devonenergy.com Slide 7 Production & Reserves Impact Reserves Liquids 43% Gas 57% Liquids 41% Gas 59% Production Liquids 37% Gas 63% Liquids 32% Gas 68% Devon Before Devon Repositioned Based on 12/31/09…
  7. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 7
    NYSE: DVN www.devonenergy.com Slide 8 Expected Proceeds Maersk transaction $1.3 $1.1 BP agreement $7.0 $5.4 - $5.8 Total estimated proceeds $9.6 - $10.3 $7.5 - $8.3 Remaining assets $1.3 - $2.0 $1.0 - $1.4 Pre-Tax Proceeds After-Tax…
  8. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 8
    NYSE: DVN www.devonenergy.com Slide 9 Allocation of Proceeds $ in Billions Balance $3.5 - $4.3 Retire outstanding commercial paper ($1.4) (12/31/09) Kirby oil sands transaction ($0.5) 2011 debt maturities ($2.1) Balance to be…
  9. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 9
    NYSE: DVN www.devonenergy.com Slide 10 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
  10. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 10
    NYSE: DVN www.devonenergy.com Slide 11 Historical Performance North American Onshore 168 220 207 183 2006 2007 2008 2009 233% 198% 269% 223% 2006 2007 2008 2009 $13.57 $13.30 $13.05 $6.59 2006 2007 2008 2009 $7.28 $8.01…
  11. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 11
    NYSE: DVN www.devonenergy.com Slide 12 Devon Repositioned Summary Deep inventory in premier North American growth plays Proven track record of performance in North America Significant financial strength Balanced product mix…
  12. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 12
    NYSE: DVN www.devonenergy.com Slide 13 2010 E&P Capital Forecast Jackfish Shale Plays Other Canada Other U.S. $4.4 ? 4.8 Billion(1) (1) 2010 capital forecast increased by $500 million to reflect Kirby oil sands purchase. 15%…
  13. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 13
    NYSE: DVN www.devonenergy.com Slide 14 2010 Hedged Position Protect prices on approximately 50 percent of forecasted oil and gas production for all periods ? 55% of estimated 2010 gas production hedged ? 1.4 Bcf/d with an average…
  14. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 14
    NYSE: DVN www.devonenergy.com Slide 15 Q4-2009a Q1-2010e Q2-2010e Q3-2010e Q4-2010e 2010 Production Growth North American Onshore MBOE Per Day Production Growth ? 8% 585 - 595 615 - 625 610 - 620 595 - 605 573
  15. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 15
    NYSE: DVN www.devonenergy.com Slide 16 Jackfish SAGD Projects Field characteristics: ? Low F&D ? Flat production profile ? Long reserve life > 20 years ? Working interest: 100% Each project: ? 300 MMBO EUR (?260 MMBO net) ? 35…
  16. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 16
    NYSE: DVN www.devonenergy.com Slide 17 Source: FirstEnergy Capital Corp. Jackfish Performance SAGD Production Per Well 0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17…
  17. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 17
    NYSE: DVN www.devonenergy.com Slide 18 Jackfish Performance Steam Oil Ratio (SOR) SAGD Project Comparison (Cumulative SOR) 9 8 7 6 5 4 3 2 1 0 10 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45…
  18. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 18
    NYSE: DVN www.devonenergy.com Slide 19 Kirby Oil Sands Joint Venture Jackfish Acreage Kirby Acreage Access Pipeline Jackfish Jackfish 2 Jackfish 3 Risked locations: 580 Net risked resource: 550 MMBO Purchased 50% of BP?s…
  19. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 19
    NYSE: DVN www.devonenergy.com Slide 20 Existing well control data and seismic Thick and continuous reservoir Good oil saturation and porosity levels Minimal depositional shale Good cap rock Minimal water issues Kirby Similarities…
  20. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 20
    NYSE: DVN www.devonenergy.com Slide 21 Iron River Manatokan End Lake Lloydminster Lloydminster Net acreage: 2.5 million Low-risk development Strong operating margins Q4 ?09 net production: ? 41 MBOED 2010 plans: Drill ? 150…
  21. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 21
    NYSE: DVN www.devonenergy.com Slide 22 SENM Program Wolfberry Low Risk Oil Development Net acreage: 144,000 Working interest: 97% Compelling economics Three operated rigs running 2009 activity: Drilled 44 wells 2010 plans: Drill ?…
  22. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 22
    NYSE: DVN www.devonenergy.com Slide 23 Barnett Shale Superior, First-Mover Advantage Parker Palo Pinto Hood Tarrant Johnson Erath Hill Jack Wise Denton Ft. Worth Highly Urbanized Denton Low average acreage cost: ?…
  23. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 23
    NYSE: DVN www.devonenergy.com Slide 24 Average Wellhead EUR Barnett Shale Average Wellhead Estimated Ultimate Recovery (EUR) (Horizontal Wells) 1.31 1.97 2.20 2.48 2.37 2.30 3 2 1 0 EOG Chesapeake XTO EnCana Quicksilver BCF…
  24. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 24
    NYSE: DVN www.devonenergy.com Slide 25 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…
  25. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 25
    NYSE: DVN www.devonenergy.com Slide 26 Cana Woodford Shale First-Mover Yields Superior Position Risked locations: 3,500 Net risked resource: 7.0 TCFE Net acreage: 118,000 Low cost of entry: ? $2,200/acre Low average royalty burden:…
  26. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 26
    NYSE: DVN www.devonenergy.com Slide 27 Haynesville Shale Significant portion of acreage held by production or fee Low average royalty burden: < 20% Low cost of entry Repeatable economic play in Carthage area Continue to evaluate…
  27. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 27
    NYSE: DVN www.devonenergy.com Slide 28 Horn River Basin Net acreage: 170,000 Thickest section of the basin Minimal drilling required to hold acreage Early stages of de-risking Firm transportation secured 27% working interest in…
  28. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 28
    NYSE: DVN www.devonenergy.com Slide 29 Other North American Onshore Properties Risked locations: ? 15,000 Net risked resources: ? 4.9 BBOE Groesbeck Washakie Peace River Carthage Conventional Granite Wash Deep Basin Powder…
  29. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 29
    NYSE: DVN www.devonenergy.com Slide 30 Resource Potential North America Onshore Kirby 800 550 580 Haynesville Shale 4,570 1,230 1,600 Other Canada 3,090 2,020 8,130 Other U.S. Onshore 4,730 2,890 7,140 Jackfish 990 800 420 Horn…
  30. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 30
    NYSE: DVN www.devonenergy.com Slide 31 Net Enterprise Value Per Flowing Barrel $49,100 $52,000 $65,000 $62,900 $73,600 $72,400 EOG Anadarko Chesapeake Apache EnCana Dvn As of April 2010 Notes: Production is based on full-year…
  31. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 31
    NYSE: DVN www.devonenergy.com Slide 32 Why Own Devon? Deep inventory in premier North American growth plays ? >32,000 risked undrilled locations ? >13 BBOE risked resource potential Balanced product mix Proven track record of…
  32. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 32
    NYSE: DVN www.devonenergy.com Slide 35 Arkoma Woodford Shale Net acreage: 58,000 Low cost of entry: ? $400/acre Low average royalty burden: 19% Acreage held by production Q4 ?09 net production: ? 71 MMCFED Strategic midstream…
  33. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 33
    NYSE: DVN www.devonenergy.com Slide 36 Carthage Field Waskom Bethany Angelina San Augustine Sabine Shelby Rusk Panola Gregg Harrison Marion Upshur Camp Cass Texas Appleby Net acreage: 218,000 Working interest: 86% Q4…
  34. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 34
    NYSE: DVN www.devonenergy.com Slide 37 Groesbeck Net acreage: 132,000 Working interest: 72% Q4 ?09 net production: ? 87 MMCFED 2009 activity: Drilled 13 wells 2010 plans: Drill ?10 wells Nan-Su-Gail Dew Bald Prairie Personville…
  35. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 35
    NYSE: DVN www.devonenergy.com Slide 38 Washakie Net acreage: 157,000 Working interest: 76% Q4 ?09 net production: ? 118 MMCFED Low-risk, tight sand gas 2009 plans: Drilled 94 wells 2010 plans: Drill ? 115 wells WY UT CO Washakie
  36. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 36
    NYSE: DVN www.devonenergy.com Slide 39 Net acreage: 255,000 Working interest: 75% Q4 ?09 net production: ? 127 MMCFED 2009 activity: Drilled 15 wells 2010 plans: Drill ? 35 wells Powder River Natrona Converse Johnson Sheridan…
  37. IPAA Oil and Gas Investment Symposium – Devon Energy Corp – slide 37
    NYSE: DVN www.devonenergy.com Slide 40 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…

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