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July 2013 Corporate Presentation – Laredo Petroleum Inc.

Laredo Petroleum Inc. · Jul 24, 2013 · 34 slides

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Slides

  1. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 1
    July 2013 July Corporate Presentation NYSE: LPI www.laredopetro.com
  2. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 2
    Company Overview NYSE: LPI Market Cap: 2.7 Billion Total Enterprise Value: 4.0 Billion Total Company Pure-play Permian oil following divestiture Low-risk drilling inventory 10 years Proved reserves: 188.6 MMBOE 1 Average daily…
  3. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 3
    Concentrated Asset Portfolio Focused in Permian Basin Permian - China Grove Tulsa Headquarters Midland Basin Permian - Delaware Garden City Basin Permian Basin 200,600 net acres1 85% of total company reserves 72% of…
  4. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 4
    Consistent Growth in Reserves and Production Permian oil is driving repeatable growth Reserves Production 34.5-35.9 200 188.6 35 180 30.9 30 156.5 160 136.6 48% 25 23.7 19.0 140 120 64% 17.3 20 MBOE/D MMBOE 67%…
  5. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 5
    Permian Basin: Core Area in Garden City 142,600 net acres1 in Glasscock, Reagan, Howard and Sterling counties 92% average working interest 25% average royalty Multiple targets with proven economic production: Vt Wolfberry Laredo…
  6. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 6
    Permian-Garden City: Vertical Wolfberry Entire 142,600 net acreage1 Howard block effectively de-risked for Mitchell Clearfork vertical development Martin Upper Sprayberry Provides a technical and economic Lower foundation for…
  7. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 7
    Permian-Garden City: Proven Multi-zone Horizontal Performance Howard Commercial horizontal development Mitchell has been proven for all four zones Martin from 68 wells Horizontal Total of Average 30-Day Zone Completions1…
  8. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 8
    Permian-Garden City: Four Proven Horizontal Zones Laredos top 10 horizontal wells Howard in portfolio1 continue to improve Mitchell Martin 30-Day Avg Initial Production Well Completion Rank/Zone Well Name BOE/D % Oil Date…
  9. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 9
    Permian-Garden City: Significant De-Risked Acreage in Four Zones Confirmed the equivalent of 360,000 net Howard Mitchell acres for horizontal development to date Martin Remaining acreage still prospective for all four…
  10. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 10
    Identified Resource Potential De-risked Acreage Additional De-Risked Resource Potential1 1800 1,415 + 1,600 + 142,600 acres Vt Wolfberry 1600 80,000 acres Hz Upper Wolfcamp 80,000 acres Hz Middle Wolfcamp 1400 73,000 acres Hz…
  11. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 11
    Permian-Garden City: Side-by-Side Program 1 mile 3 miles LPI Acreage Multiple Goals Optimize spacing and minimize interference Lateral lengths: 7,000 7,500 feet Spacing: 660 feet Frac design and monitoring Frac…
  12. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 12
    Permian-Garden City: Stacked Lateral Program LPI Acreage Objectives Evaluate multi-well stacked laterals Optimize vertical distance between laterals and communication Optimize frac design and monitoring Test pad layout and…
  13. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 13
    Permian-Garden City: Wolfcamp Estimated Type Curves All graphs presented in two-stream BOE per day 1000 Upper Wolfcamp 1000 Lower Wolfcamp 21 wells presented 2 wells presented 100 100 758 MBOE 668 MBOE 10 10 Months Months…
  14. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 14
    Permian-Garden City: Cline Estimated Type Curves All graphs presented in two-stream BOE per day 1000 100 Cline Per Stage Cline Long Laterals 35 wells presented 26 Stages 620 MBOE BOE/D/Stage BOE/D 10 100 1 10 Months…
  15. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 15
    Pad Drilling: Gaining Efficiencies, Increasing ROR D+C Cost ROR% EUR ( Millions) (MBOE) Upper Wolfcamp 7.8 43% - 53% 715 800 Middle Wolfcamp 7.8 30% - 40% 600 700 Lower Wolfcamp 8.5 26% - 38% 605 730 Cline 9.0 18% - 30% 550 - 690…
  16. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 16
    Permian Focused 2013 Capital Program Initial 2013 Capital Program Post-Divestment 2013 Capital Program Effective April 1, 2013, Company divested Granite Wash and Other properties. Capital for remainder of 2013 has 88% been…
  17. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 17
    Strong Liquidity & Financial Profile Liquidity 5/31/13 Financial Debt Ratios1 3/31/13 Cash and marketable securities 45 MM Debt / Adj. EBITDA-LTM 2.9x Current Borrowing Base2 1,000 Borrowings (375) EBITDA / Interest 4.7x Total…
  18. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 18
    Permian Oil Take-away Capacity Planned Completion Capacity Date MBOPD Existing Take-away Cushing Total Refineries 410 Wichita Falls Total Oil Pipelines 880 Longview Total Existing Capacity 1,290 Expansion Capacity 1…
  19. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 19
    Permian NGL and Gas Take-away Capacity Capacity NGL Existing Take-away1 MBPD NGL Pipelines 600 Permian Fractionation 135 Total Existing Capacity 735 Planned Capacity Expansion Capacity Completion MBPD Lone Star2 1Q-13 100…
  20. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 20
    LPI Addressing Take-away Capacity Issues Laredo Permian Oil Take-away Capacity 10,000 BOPD committed to Longhorn, increasing annually to 23,000 BOPD over 5 years Firm transportation out of the Permian Eliminates Mid/Cush basis…
  21. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 21
    Summary of Granite Wash Divestiture Laredo entered into a Purchase and Sales Agreement (PSA) with certain EnerVest affiliates covering virtually all of the Companys assets in the Anadarko Basin, including associated gas gathering…
  22. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 22
    Guidance 2Q-2013 FY 2013 Production (MMBOE): 2.9 3.2 12.6 13.1 Price Realizations (pre-hedge, two-stream basis, % of NYMEX): Crude oil 90% - 95% 90% - 95% Natural gas, including natural gas liquids 130% - 140% 130% - 140%…
  23. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 23
    2012 Year-End Reserves1 By Product 48% 52% By Category By Location 4% 11% Oil Natural Gas 43% 57% 189 MMBOE 85% 12/31/12 PUD Reserves PD Reserves Permian Granite Wash Other 1 Reserve volumes presented on a two-stream…
  24. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 24
    Permian-Garden City Shale Characteristics Laredos acreage contains up to 1,825 feet of pay from four defined stacked shale zones with proven horizontal development potential Wolfcamp Upper Middle Lower Cline Shale Combined Basin…
  25. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 25
    Permian-Garden City: Regional Wolfcamp Cross Section Wolfcamp shale intervals underlie LPIs Martin Permian-Garden City acreage position GLASSCOCK Co. REAGAN Co. N S 85+ miles Upper Wolfcamp Middle Wolfcamp 20+ miles…
  26. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 26
    Permian Basin-Garden City: Regional Cline Cross Section Cline shale across LPIs acreage position GLASSCOCK Co. REAGAN Co. N S 85+ miles CLINE HIGH-QUALITY RESOURCE PLAY 20+ miles LPI acreage Cross section line 87…
  27. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 27
    Permian: Vertical Wolfberry Presented in two-stream BOE per day 1000 100 BOE/D Deep Vertical Wolfberry Vertical Wolfberry type curve shown 10 in red Normalized production data for 1 275+ deep vertical Wolfberry wells…
  28. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 28
    Permian-China Grove: Prospective for Cline Shale Leveraging Permian knowledge and Borden Scurry database with China Grove acreage; Treadaway potential for Cline Shale Hz Cline test Howard Approximately 58,020 net acres1 Mitchell…
  29. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 29
    Anadarko Granite Wash: Multiple Porosity Trends Well Economics Stacked, liquids-rich porosity trends D+C Cost 8.0-9.5 MM extend across Laredos acreage EUR 735 MBOE Texas Oklahoma 30-Day IP 1,690 BOE/D % Oil 6% - 8% (IP Life) ROR1…
  30. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 30
    Two-Stream vs. Three-Stream Laredo reports on a two-stream basis to match its ownership in production Two-Stream Three-Stream Q1-2013 Production NGL Oil 25% Gas Gas 45% 20% Increase 37% 55% Oil 38% Two-Stream Two-Stream…
  31. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 31
    Oil Hedging: Protect and Stabilize Cash Flows Oil Positions As of June 30, 2013 Current Hedge Position 2013 2014 2015 2016 Total OIL1 Remainder of year Puts: Hedged Volume (Bbls) 540,000 540,000 456,000 - 1,536,000 Average price…
  32. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 32
    Gas Hedging: Protect and Stabilize Cash Flows Natural Gas Positions As of June 30, 2013 Current Hedge Position 2013 2014 2015 2016 Total NATURAL GAS1 Remainder of year Puts: Hedged Volume (MMBtu) 3,300,000 - - - 3,300,000 Average…
  33. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 33
    Historical Financial & Operating Data millions, except per unit data 2010 2011 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Key data: Realized oil price (/Bbl) 1 77.26 88.62 86.69 85.45 86.58 81.00 83.03 Realized natural gas price (/Mcf) 1…
  34. July 2013 Corporate Presentation – Laredo Petroleum Inc. – slide 34
    Adjusted EBITDA Reconciliation ( thousands, unaudited) 2010 2011 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Net income (loss) 86,248 105,554 61,654 30,975 (7,384) 11,828 1,409 Plus: Interest expense 18,482 50,580 85,572 21,674 24,423…

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