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3Q Company Presentation – Consol Energy Inc.

Consol Energy Inc. · Oct 28, 2014 · 155 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. 3Q Company Presentation – Consol Energy Inc. – slide 1
    Company Presentation Q3 2014
  2. 3Q Company Presentation – Consol Energy Inc. – slide 2
    Company Overview Transformative Journey Ten years ago traditional coal producer, the largest underground producer in the world Eight years ago IPO of CNX Gas Four years ago acquired Dominion Resources Appalachian E&P business and…
  3. 3Q Company Presentation – Consol Energy Inc. – slide 3
    Company Overview CONSOL Energy Core Values Unwavering focus on Core Values of safety, compliance, and continuous improvement 6
  4. 3Q Company Presentation – Consol Energy Inc. – slide 4
    Company Overview Strategic Evolution CONSOLs E&P Division represents the greatest portion of EBITDA Natural gas is the de facto choice for new MWh demand as well as for backfilling market share ceded by nuclear and coal, which is a…
  5. 3Q Company Presentation – Consol Energy Inc. – slide 5
    Company Overview Oil and Gas Acreage Ownership CONSOL % of Legacy Ownership by State and Horizon State Marcellus Utica Burkett Rhinestreet PA 50% 100% 50% 100% WV 50% 100% 50% 100% OH 100% 50% 100% 100% Note: CONSOLs…
  6. 3Q Company Presentation – Consol Energy Inc. – slide 6
    Company Overview Summary We have tier-one assets across our entire Appalachian-centric portfolio, in both E&P and Coal: - Sweet spots in both the wet and dry portions of the Marcellus and Utica shales - Multiple stack pay…
  7. 3Q Company Presentation – Consol Energy Inc. – slide 7
    Company Overview Third Quarter 2014 Results Net loss for the third quarter was (2) million - Includes four pre-tax items related to recent transactions completed by the company: 21.0 million expense related to early extinguishment of…
  8. 3Q Company Presentation – Consol Energy Inc. – slide 8
    Company Overview E&P Division: Summary Q-to-Q Q-to-Q E&P Division 3Q2014 3Q2013 Change 3Q2014 2Q2014 Change Average Sales Price ( / Mcfe) 3.97 4.20 (0.23) 3.97 4.44 (0.47) Average Costs ( / Mcfe) 3.12 3.23 (0.11) 3.12 3.44 (0.32)…
  9. 3Q Company Presentation – Consol Energy Inc. – slide 9
    Company Overview Coal Division: Summary Q-to-Q Q-to-Q Coal Division 3Q2014 3Q2013 Change 3Q2014 2Q2014 Change Average Sales Price ( / ton) 62.32 68.23 (5.91) 62.32 62.43 (0.11) Average Costs ( / ton) 49.93 50.70 (0.77) 49.93 47.63…
  10. 3Q Company Presentation – Consol Energy Inc. – slide 10
    Company Overview CONSOL Cost Metrics Gas: Operating Costs per Mcfe 6 5 / Mcfe 4 3 2 3Q2012 4Q2012 1Q2013 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 3Q2014 CBM Marcellus Shallow Oil & Gas Coal: Cost per Ton Sold 86 76 /…
  11. 3Q Company Presentation – Consol Energy Inc. – slide 11
    Company Overview Strong Liquidity Position of 2.0 Billion Cash on hand of 226 million, up from 147 million in 2Q 2014 Accounts receivable securitization and revolving credit facility of 1.8 billion Amount/ Amount Letters Amount…
  12. 3Q Company Presentation – Consol Energy Inc. – slide 12
    Company Overview CONSOL Energy: Net (Decrease)/Increase in Cash Goal is to maintain our strong liquidity position Cash Flow Summary Q-to-Q Q-to-Q ( in millions) 3Q2014 3Q2013 Change 3Q2014 2Q2014 Change Net Cash Provided by…
  13. 3Q Company Presentation – Consol Energy Inc. – slide 13
    Company Overview Marketing 4Q14 and 2014 Forecasts 2014 Coal Sales Facts and Goals Contracted tons for 2014: 100% Sales Tons by Product Year 2014 - Priced: 100% 4% Approximately 79% of the Low-Vol & High-Vol met 11% coal tons…
  14. 3Q Company Presentation – Consol Energy Inc. – slide 14
    E&P Division Q3 2014 Operations Summary Marcellus Shale Quarterly Summary Utica Shale Quarterly Summary Avg. TIL Avg. TIL Turned Turned Sub- Horizontal Lateral Sub- Horizontal Lateral Drilled Completed In Line Counties Drilled…
  15. 3Q Company Presentation – Consol Energy Inc. – slide 15
    E&P Division Continuous Improvement in the Marcellus Shale Average Completed Lateral Length Average Max IP and Average 30-Day Rate 9,000 14,000 8,000 8,000 11,555 12,000 7,000 10,000 9,297 6,000 5,483 8,298 5,137 8,000…
  16. 3Q Company Presentation – Consol Energy Inc. – slide 16
    E&P Division CONSOL Energy is a Low Cost Leader 2011-2013 All Sources Reserve Replacement: 3-Year Average vs. E&P Peers 2,000% 1,500% Average: 316% 1,000% 515% 500% 0% CONSOL Energy 2011-2013 All Sources F&D Cost: 3-Year…
  17. 3Q Company Presentation – Consol Energy Inc. – slide 17
    E&P Division Large and Growing E&P Reserves YE 2013 Proved Reserves Proved Reserves Growth 6,000 172 105 (172) 1,633 5,731 6,000 5,731 5,000 5,000 3,993 4,000 3,993 4,000 3,732 3,480 3,000 44% increase in proved…
  18. 3Q Company Presentation – Consol Energy Inc. – slide 18
    E&P Division Resource and Opportunity Rich Portfolio Proved Estimated Potential Locations (Gross) Tcfe Proved(2) Unproven Total Marcellus Shale 3.4 1,414 8,024 9,438 Utica Shale(1) 0.1 45 3,030 3,075 Upper Devonian 0.0 5…
  19. 3Q Company Presentation – Consol Energy Inc. – slide 19
    E&P Division Summary Marcellus Shale Utica Shale Future Development / Potential Growth engine over next 3-5 Growing portion of Stacked pay potential years of development production mix over next 3 Pittsburgh Airport years Over 60%…
  20. 3Q Company Presentation – Consol Energy Inc. – slide 20
    E&P Division 2014E Drill Schedule and Activity Overview Marcellus Shale Utica Shale Upper Devonian PA/W North South Ohio Ohio SWPA CPA WV Ohio(1) Total V Total SWPA WV Total Wet Wet Wet Dry Dry Drilled 46 12 25 1 68 30 182 32 1…
  21. 3Q Company Presentation – Consol Energy Inc. – slide 21
    E&P Division Gas Division Production Growth Gas Production 450 +30% 400 350 +30% 300 250 235-240 Bcfe 200 172.4 153.5 156.3 150 127.9 94.4 +49% 100 76.6 56.1 58.2 +47% 44.5 48.6 48.4 50 +94% 0 2003 2004…
  22. 3Q Company Presentation – Consol Energy Inc. – slide 22
    E&P Division 2014E E&P Capex: 1,110 million Land capex Other E&P Capex Coal 2014E E&P Capex Potential Marcellus JV Carry 26% 1,200 1,110 953 1,000 in millions 800 600 528 E&P 400 74% 200 0 2012 2013 2014E E&P…
  23. 3Q Company Presentation – Consol Energy Inc. – slide 23
    E&P Division 2014E E&P Capex: 1,110 million Marcellus Wet 410 million Marcellus Dry 415 million Utica Wet 105 million Wet Dry Oil Wet Dry Utica Dry 10 million Source: Company filings. 27
  24. 3Q Company Presentation – Consol Energy Inc. – slide 24
    E&P Division Joint Ventures Overview Summary of JV Carry Eligible Capital Description Marcellus / Noble Utica / Hess Ownership 50/50 50/50 Net acreage 345,151(1) 68,488(2) Zones PA and WV Marcellus, Burkett to Onondaga OH Utica…
  25. 3Q Company Presentation – Consol Energy Inc. – slide 25
    E&P Division Declining E&P Unit Costs Driving Down Weighted Average Cost: Consolidated Cost per Mcfe Property & Other Taxes Direct Admin, Selling & Other Total operating cost per Mcfe expected to decline LOE Gathering and…
  26. 3Q Company Presentation – Consol Energy Inc. – slide 26
    E&P Division Asset Teams: Overview Ensuring locations are drill-ready Build teams and alignment 4 Teams: Northern Marcellus: Pennsylvania Deliver on IRR and PVR Southern Marcellus: West Virginia Focused on capital efficiency Utica…
  27. 3Q Company Presentation – Consol Energy Inc. – slide 27
    E&P Division Marcellus Recompletions Update GH 15 Production History and Recomplete GH 10 Production History and Recomplete 3,000 5,000 Recomplete at Recomplete at 4,500 Recomplete at Recomplete at 2,500 time zero real-time time…
  28. 3Q Company Presentation – Consol Energy Inc. – slide 28
    Marcellus Shale Overview 436,000 CONSOL net acres 88% NRI 87% HBP 21.9 Tcfe 3P Over 8,900 gross potential wells(1) 2014E drilled wells: 182(2) 94% Marcellus production growth expected in 2014E Liquids growth from 2% in…
  29. 3Q Company Presentation – Consol Energy Inc. – slide 29
    Marcellus Shale Growth Runway and Depth of Inventory Marcellus Shale Upside Potential Total Prospective Marcellus Acreage 790,000 - Acres within JV 690,000 - Acres outside JV 100% CONSOL 100,000 Acreage per well (assumed 750 ft…
  30. 3Q Company Presentation – Consol Energy Inc. – slide 30
    Marcellus Shale Actual Well Costs vs. Lateral Length 2012 and 2013 Combined Well Costs RCS/SSL Well Costs 12,000,000 12,000,000 Actual RCS/SSL well costs 10,000,000 10,000,000 8,000,000 8,000,000 6,000,000 6,000,000…
  31. 3Q Company Presentation – Consol Energy Inc. – slide 31
    Marcellus Shale Increasing Economics By Drilling Longer Laterals IRR w/Carry IRR w/Eff IRR Hist. CONSOL has consistently 160% 154% increased drilled lateral 145% lengths each year 136% 2011: 3,853 ft 126% 115% 2012: 5,514 ft 120%…
  32. 3Q Company Presentation – Consol Energy Inc. – slide 32
    Marcellus Shale: Drilling CONSOL-Operated Summary Drilling Summary 2011 2012 2013 YTD 2014 Wells TDd 78 64 46 68 Lateral ft 300,466 328,428 366,615 513,235 Total MD ft 92,264 794,098 730,316 1,045,694 Average Lateral ft 3,853…
  33. 3Q Company Presentation – Consol Energy Inc. – slide 33
    Marcellus Shale: Drilling Cost Efficiencies and Improvements Air Directional: Expect a two-day reduction in horizontal cycle times Technological Advances: One-run RSS tools; drilling optimization, and evaluating 7-7/8 production…
  34. 3Q Company Presentation – Consol Energy Inc. – slide 34
    Marcellus Shale: Drilling Air Directional NV34B Without Air Directional Air Directional Top Hole Horizontal Comparison NV58E NV34B Air Directional Work Yes No Kick-Off Point ft 6,700 5,600 o o Starting Inclination 24 0 Total MD…
  35. 3Q Company Presentation – Consol Energy Inc. – slide 35
    Marcellus Shale: Completions CONSOL-Operated Summary Completions Summary 2011 2012 2013 YTD 2014 Wells Completed 57 51 59 41 Lateral Completed ft 188,800 270,256 333,895 374,523 Total Stages 684 940 1,527 2,319 Average Stage/Well…
  36. 3Q Company Presentation – Consol Energy Inc. – slide 36
    Marcellus Shale: Completions Cost Efficiencies and Improvements Completions Pricing Reduction: Renegotiating contracts Efficiency Increases: Increases the number of stages per day Stimulation Design Optimization: Pump rates, sand…
  37. 3Q Company Presentation – Consol Energy Inc. – slide 37
    Marcellus Shale: Completions Cost Efficiencies and Improvements Entire pad average stages per day Increasing from 4 to 8 stages per day equates to capital savings of 430,000 and reduces cycle time by 7 days Capital Savings vs.…
  38. 3Q Company Presentation – Consol Energy Inc. – slide 38
    Marcellus Shale: Completions RCS/SSL Overview 30 30 30 30 30 30 30 30 30 60 60 60 60 Cluster Spacing reduced from 60 to 30 Stage Length Standard 300 Stage SSL 150 SSL 150 reduced from 300 to 150 Length Stage Stage RCS/SSL…
  39. 3Q Company Presentation – Consol Energy Inc. – slide 39
    Marcellus Shale: Completions RCS/SSL Activity Overview 14 RCS/SSL wells to date 46 RCS/SSL wells to date 16 RCS/SSL wells to date Producing Pads Note: Townships are shown in yellow where CONSOL holds 3,000 or more…
  40. 3Q Company Presentation – Consol Energy Inc. – slide 40
    Marcellus Shale: Sub-Regions Summary Marcellus Shale North South SWPA CPA WV Ohio(1) Total Wet Wet Net Acres 45,000 110,000 105,000 11,000 60,000 105,000 436,000 Approximate Gross 700 2,000 2,300 100 1,600 2,200 8,900…
  41. 3Q Company Presentation – Consol Energy Inc. – slide 41
    Marcellus Shale: Southwest PA Southwest PA Overview 45,000 CONSOL net acres NV56 Pad Over 700 gross locations(1) 6 Wells 8,753 Avg Lateral Length per well 9,230 Mcfe Avg 30-day IP per well 144 wells online, as NV36 Pad NV57 Pad…
  42. 3Q Company Presentation – Consol Energy Inc. – slide 42
    Marcellus Shale: Southwest PA Southwest PA 5,000 ft Type Curve and Economics 1,000 100 MMcfe/Mo 10 1 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 160% 159% 131% Southwest PA Assumptions Type Curve 2014E…
  43. 3Q Company Presentation – Consol Energy Inc. – slide 43
    Marcellus Shale: Southwest PA Southwest PA Production vs. 5,000 ft Type Curve 8.5 Bcfe Type Curve 7.2 Bcfe Type Curve Projecting 18% improvement in EURs utilizing RCS/SSL 51
  44. 3Q Company Presentation – Consol Energy Inc. – slide 44
    Marcellus Shale: Southwest PA Southwest PA Production vs. 5,000 ft Type Curve 11.6 Bcfe Type Curve 9.6 Bcfe Type Curve We expect to drill 16, 53, and 19 horizontal wells in 2014, 2015, and 2016, respectively 52
  45. 3Q Company Presentation – Consol Energy Inc. – slide 45
    Marcellus Shale: Northern WV Dry Northern WV Overview 105,000 CONSOL net acres Over 2,300 gross ANDERSON (PDC Mountaineer) 3 Wells PHL10 Pad locations(1) 4,859 Avg Lateral Length per well 6 Wells 595 MMcf/well 1st 6-Month Cum 4,636…
  46. 3Q Company Presentation – Consol Energy Inc. – slide 46
    Marcellus Shale: Northern WV Dry Northern WV 5,000 ft Type Curve and Economics 1,000 100 MMcfe/Mo 10 1 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 100% Northern WV Dry 85% Assumptions Type Curve 2014E…
  47. 3Q Company Presentation – Consol Energy Inc. – slide 47
    Marcellus Shale: Northern WV Dry Northern WV Production vs. 5,000 ft Type Curve 7.9 Bcfe Type Curve 6.6 Bcfe Type Curve Early constraints and faulting may be masking results but expect improved production with continued…
  48. 3Q Company Presentation – Consol Energy Inc. – slide 48
    Marcellus Shale: Northern WV Dry Northern WV - Dominion Transmission Storage Field Antero Activity(1) Within 2 miles of DTI northern border AUD7 Pad Average EURs: 1.7 Bcfe/1,000 lateral 1 Well Delineation utilizing RCS/SSL 8,904Avg…
  49. 3Q Company Presentation – Consol Energy Inc. – slide 49
    Marcellus Shale: Central PA Central PA Overview 110,000 CONSOL net acres Over 2,000 gross GAUT4 Pad locations(1) 4 Wells 7,941 Avg Lateral Length per well 56 wells online, as of 6,619 Mcfe Avg 30-day IP per well 759 MMcf/well 1st…
  50. 3Q Company Presentation – Consol Energy Inc. – slide 50
    Marcellus Shale: Central PA Central PA 5,000 ft Type Curve and Economics 1,000 100 MMcfe/Mo 10 1 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 80% 78% 63% Central PA 60% 57% Assumptions Type Curve…
  51. 3Q Company Presentation – Consol Energy Inc. – slide 51
    Marcellus Shale: Central PA Central PA Production vs. 5,000 ft Type Curve 7.2 Bcfe Type Curve 6.0 Bcfe Type Curve Eleven RCS/SSL wells are included 59
  52. 3Q Company Presentation – Consol Energy Inc. – slide 52
    Marcellus Shale: North Wet Gas New Project Areas Pittsburgh Airport 45 planned Marcellus laterals 45 potential Upper Devonian laterals 15 planned 30 potential 45 potential Utica Shale laterals 9,000 contiguous acres have…
  53. 3Q Company Presentation – Consol Energy Inc. – slide 53
    Marcellus Shale: North Wet Gas North Wet Gas Overview 60,000 CONSOL net acres Over 1,600 gross locations(1) 83 wells online, as of 10/1/2014 IMPERIAL LAND (Range 63 wells online in Resources) 2014E 4 Wells BARE WARREN (Range…
  54. 3Q Company Presentation – Consol Energy Inc. – slide 54
    Marcellus Shale: North Wet Gas North Wet Gas Overview CONSOL to sell Noble rights to 3,000 Utica acres in Moundsville Field AMI only covers Moundsville Development and combines 1,000+ areas already jointly held Will utilize mix…
  55. 3Q Company Presentation – Consol Energy Inc. – slide 55
    Marcellus Shale: North Wet Gas North Wet Gas 5,000 ft Type Curve and Economics 1,000 5 Wellhead Sold Gas 4 100 Condensate MMcf/Mo MBbl/Mo NGL 3 2 10 1 1 0 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 100%…
  56. 3Q Company Presentation – Consol Energy Inc. – slide 56
    Marcellus Shale: North Wet Gas North Wet Gas Production vs. 5,000 ft Type Curve Increasing productivity Limited use of RCS/SSL First 12 wells of 2014 8 wells utilized RCS/SSL in 2014 2014 IP rates significantly above 2012 and…
  57. 3Q Company Presentation – Consol Energy Inc. – slide 57
    Marcellus Shale: North Wet Gas Liquids Production Growth Price Uplift from Wet Gas Increases Value over 60% to Liquids Volume Growth Almost 7 per Mcf of Wellhead Gas Gas NGL Condensate /Mcf 9 6.96 10 Bbl/MMcf condensate at…
  58. 3Q Company Presentation – Consol Energy Inc. – slide 58
    Marcellus Shale: South Wet Gas South Wet Gas Overview SHR1 Pad 105,000 CONSOL net 6 Wells 8,741 Avg Lateral Length per well WEESE (Triad Hunter) 3 Wells acres PENS1 Pad 10,143 Mcfe Avg 30-day IP per well 9 Wells 3,711 Avg Lateral…
  59. 3Q Company Presentation – Consol Energy Inc. – slide 59
    Marcellus Shale: South Wet Gas South Wet Gas 5,000 ft Type Curve and Economics 1,000 5 Wellhead Sold Gas 4 100 Condensate MMcf/Mo MBbl/Mo NGL 3 2 10 1 1 0 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 60%…
  60. 3Q Company Presentation – Consol Energy Inc. – slide 60
    Marcellus Shale: South Wet Gas South Wet Gas Production vs. 5,000 ft Type Curve Condensate yield: 5 Bbls/MMcf NGLs yield: 33 Bbls/MMcf 7.0 Bcfe Type Curve 5.0 Bcfe Type Curve 68
  61. 3Q Company Presentation – Consol Energy Inc. – slide 61
    Utica Shale Overview: A Leading Position in the Utica Shale 581,000 CONSOL net acres(1) Over 3,000 gross locations 41 wells online, as of 10/1/2014 43 wells online in 2014E 7,000 ft average laterals in 2014E 4-5 wells per pad…
  62. 3Q Company Presentation – Consol Energy Inc. – slide 62
    Utica Shale Growth Runway and Depth of Inventory Utica Shale Upside Potential Total Prospective Utica Acreage 650,000 - Acres within JV 137,000 - Acres outside JV 100% CONSOL 513,000 Acreage per well (assumed 750 ft spacing) 86…
  63. 3Q Company Presentation – Consol Energy Inc. – slide 63
    Utica Shale Utica Production Growth Production 50 40.4 40 37.8 30 Bcfe 20 16.4 10 0.8 0 2013 2014E 2015E 2016E Utica Net Production Utica shale 2014E production guidance raised from 13.5 Bcfe to 16.4…
  64. 3Q Company Presentation – Consol Energy Inc. – slide 64
    Utica Shale: Drilling CONSOL-Operated Summary Drilling Summary 2013 YTD 2014 Wells TDd 9 14 Lateral ft 63,167 79,079 Total MD ft 137,769 164,574 Average Lateral ft 7,019 5,649 Average TMD ft 15,308 11,755 Average Drill Cost/ft…
  65. 3Q Company Presentation – Consol Energy Inc. – slide 65
    Utica Shale: Drilling Cost Efficiencies and Improvements Shortened Intermediate Casing: Potential to reduce cycle times by 8 days with revised casing program; could result in reduction in cost of 900k per well Technological Advances:…
  66. 3Q Company Presentation – Consol Energy Inc. – slide 66
    Utica Shale: Completions CONSOL-Operated Summary Completions Summary 2012 2013 YTD 2014 Wells Completed 4 10 12 Lateral Completed ft 18,160 50,916 73,298 Total Stages 63 200 495 Average Stg/Well 16 20 41 Average Stage Cost 310k 224k…
  67. 3Q Company Presentation – Consol Energy Inc. – slide 67
    Utica Shale: Completions Cost Efficiencies and Improvements Completions Pricing Reduction: Renegotiating contracts Efficiency Increases: Increases the number of stages per day Stimulation Design Optimization: Pump rates, sand…
  68. 3Q Company Presentation – Consol Energy Inc. – slide 68
    Utica Shale: Sub-Regions 2014E Activity Overview Utica Shale Ohio Wet Ohio Dry PA/WV Dry Total Net Acres 84,000 25,000 472,000 581,000 Approximate Gross 500 300 2,200 3,000 Locations(1) Avg EURs/1,000 ft 1.9 2.4 1.8 --…
  69. 3Q Company Presentation – Consol Energy Inc. – slide 69
    Utica Shale: Ohio Wet Gas The Utica Sweet Spot Evolves HES Cadiz A HES Cadiz B IP GAS: 8,006 Mcf/d IP GAS: 12,000 Mcf/d CHK - Buell 8H IP OIL: 399 Bbl/d IP OIL: 218 Bbl/d IP GAS: 9,500 Mcf/d IP OIL: 1,425 Bbl/d HES Athens A GPOR - Boy…
  70. 3Q Company Presentation – Consol Energy Inc. – slide 70
    Utica Shale: Ohio Wet Gas CONSOLs Historic Core: Noble, Harrison, Belmont, Guernsey, and Jefferson Counties 84,000 CONSOL net acres 36,000 CONSOL net acres in core Type curve reflects core area Over 500 gross core area…
  71. 3Q Company Presentation – Consol Energy Inc. – slide 71
    Utica Shale: Ohio Dry Gas Recent IP Rates In and Around Monroe County, OH CVX Conner well (Utica): 25.0 MMcf/d Avg 24-hr rate GPOR Irons 1-4H (Utica): ECR Shroyer 2-well pad (Utica): 30.3 MMcf/d Avg 24-hr rate 7,819 Avg later…
  72. 3Q Company Presentation – Consol Energy Inc. – slide 72
    Utica Shale: Ohio Dry Gas Ohio Dry Gas Area Production vs. 5,000 ft Type Curve 25,000 CONSOL net acres 11,000 net acres in Monroe County, OH 14,000 net acres in eastern portion of Jefferson, Belmont and Harrison counties Over…
  73. 3Q Company Presentation – Consol Energy Inc. – slide 73
    Utica Shale: PA/WV Dry Gas Utica PA/WV Dry Gas Area Overview REXX Cheeseman 1 IP Gas: 9,200 Mcf/d RRC Zahn 1 IP Oil: 0 Bbl/d IP Gas: 4,500 Mcf/d IP Oil: 0 Bbl/d CHK Thompson 3H CHK Hubbard 3H IP Gas: 6,400 Mcf/d IP Gas: 11,00…
  74. 3Q Company Presentation – Consol Energy Inc. – slide 74
    Utica Shale: PA/WV Dry Gas Utica PA/WV Dry Gas Production vs. 5,000 ft Type Curve 472,000 CONSOL net acres 300,000 prospective net acres in PA (80,000 net acres located within Greene and Washington counties) 172,000…
  75. 3Q Company Presentation – Consol Energy Inc. – slide 75
    Upper Devonian Burkett Shale Sweet Spot CONSOL is well situated in the best part of the Burkett fairway, with an estimated 345,000 net acres of potential across the entire Upper Devonian 88
  76. 3Q Company Presentation – Consol Energy Inc. – slide 76
    Upper Devonian NV39F Upper Devonian Exploration Well Drilled in Southwest PA 5 underlying Marcellus wells on pad Washington County, PA Drilled lateral length of 4,889 ft Fracd 17 stages in Burkett Shale Tested 3.0 MMcf/d, TIL…
  77. 3Q Company Presentation – Consol Energy Inc. – slide 77
    Upper Devonian Upper Devonian Production vs. 5,000 ft Type Curve First Upper Devonian well demonstrating very shallow decline compared to type curve Currently producing above type curve: Forecasted EUR 9 Bcfe Planning 6+ Burkett…
  78. 3Q Company Presentation – Consol Energy Inc. – slide 78
    Stacked Pay Potential Appalachian Shale Acreage P a y Formation Name Wet Dry Total Net Acres Net Acres Net Acres Rhinestreet Shale Upper Cashaqua Shale Devonian 190,000 155,000 345,000 Middlesex Shale West River…
  79. 3Q Company Presentation – Consol Energy Inc. – slide 79
    Stacked Pay Potential CONSOLs Shale Fairway PIT Airport Rhinestreet = 5,340 Burkett = 5,460 Marcellus = 5,690 Utica = 10,760 Monroe County/Moundsville Rhinestreet = 5,930 Burkett = 6,110 Southwest PA Marcellus = 6,190…
  80. 3Q Company Presentation – Consol Energy Inc. – slide 80
    Stacked Pay Potential Gas Factory Development Stacked laterals provide economies of scale to access up to 4 pays from 1 pad 94
  81. 3Q Company Presentation – Consol Energy Inc. – slide 81
    Stacked Pay Potential Southwest PA Stack Pay Potential: 9.0 Tcfe Resource Potential Potential Lateral Spacing Well CapEx EUR Liquids Resource Pay Wells Length (ft) (acre) (MM) (Bcfe) (%) (Bcfe) Burkett 235 6,400 110 7.6 9.5 - 2,226…
  82. 3Q Company Presentation – Consol Energy Inc. – slide 82
    Stacked Pay Potential Pittsburgh Airport Stack Pay Potential: 1.6 Tcfe Resource Potential Potential Lateral Spacing Well CapEx EUR Liquids Resource Pay Wells Length (ft) (acre) (MM) (Bcfe) (%) (Bcfe) Upper Devonian (Burkett) 45 8,000…
  83. 3Q Company Presentation – Consol Energy Inc. – slide 83
    Other Gas Reserves and Resources Virginia Coalbed Methane (CBM) 350,000 net acres(1) Origin of CNX Gas Associated with mining at Buchanan mine Advantageous gas marketing location for basis Over 2,700 gross locations 3,000 wells…
  84. 3Q Company Presentation – Consol Energy Inc. – slide 84
    Other Gas Reserves and Resources Conventional Wells 2,294,000 net acres(1) HBP position creates substantial flexibility to explore and develop other pays Mostly acquired with Dominion E&P acquisition in 2010 70,000 gross…
  85. 3Q Company Presentation – Consol Energy Inc. – slide 85
    Other Gas Reserves and Resources Chattanooga Shale, Monteagle SOG, and Conasauga Shale 243,000 CONSOL net acres 2,170 gross locations 74 wells online as of 10/1/2014 5 wells online in 2014E Chattanooga: 1.5 million/Hz well 1.0…
  86. 3Q Company Presentation – Consol Energy Inc. – slide 86
    Other Gas Reserves and Resources Illinois Basin 277,000 net acres(1) 1,400 gross locations Stacked pay potential Mississippian and Devonian sandstones and carbonate New Albany shale Maquoketa shale Currently producing: 0.2…
  87. 3Q Company Presentation – Consol Energy Inc. – slide 87
    E&P Division Summary 30% gas production growth Implemented asset teams Driving costs down with efficiencies and lean manufacturing Stacked pay potential Solid production with conventional assets Joint ventures with established…
  88. 3Q Company Presentation – Consol Energy Inc. – slide 88
    Gas Marketing Appalachia Energy Basin - Stacked Reserves Upper Devonian Utica Shale Marcellus Shale Pittsburgh 8 Coalbed Methane Conventional SOG Reserves Pocahontas Coalbed Methane CONSOL Energy is located in…
  89. 3Q Company Presentation – Consol Energy Inc. – slide 89
    Gas Marketing CONSOL Energy Assets CNX Assets Marcellus Shale Utica Shale Upper Devonian Conventional SOG Upper Coalbed Methane Devonian Utica Coal Reserves Shale Marcellus Shale Bailey Complex Conventional SOG CNX…
  90. 3Q Company Presentation – Consol Energy Inc. – slide 90
    Gas Marketing Market Opportunities - Stacked Customers Power Plants Natural Gas Plants Coal Plants Our ability to produce both natural gas and coal allows us the flexibility to provide an energy solution to utilities that burn…
  91. 3Q Company Presentation – Consol Energy Inc. – slide 91
    Gas Marketing Shared Value Opportunities Land Thermal Coal Gathering NGL Sales Processing Export Ethane Met Coal Pipelines Domestic Ethane Power Purchases Export Coal Dry Gas Sales Export LNG Actively pursuing…
  92. 3Q Company Presentation – Consol Energy Inc. – slide 92
    Gas Marketing Summary Natural Gas Sales - Current NYMEX hedges cover 73% of total volumes for CY2014 - Sales portfolio of 80 customers in five index markets (29% basin exports) Firm Transportation - FT capacity supports the majority…
  93. 3Q Company Presentation – Consol Energy Inc. – slide 93
    Gas Marketing Firm Transportation Total company FT capacity supports the majority of plan production for the three-year growth plan Targeting pipeline projects that access favorable markets Will supplement direct FT with firm…
  94. 3Q Company Presentation – Consol Energy Inc. – slide 94
    Gas Marketing Firm Transportation - Current Portfolio ANR Pipeline Dominion (DTI) Columbia (TCO) East Tennessee Year-End Pipeline (MMcf/d) 2014 2017 Dominion (DTI) 255 354 East Tennessee 282 282 Texas Eastern (TETCO)…
  95. 3Q Company Presentation – Consol Energy Inc. – slide 95
    Gas Marketing Firm Transportation - Recent Projects ANR Capacity Nexus Capacity Volume: 47,000 Mcf/d Volume: PA Executed Start Date: November 2015 Start Date: November 2017 Market: MichCon/Chicago Market: MichCon MichCon…
  96. 3Q Company Presentation – Consol Energy Inc. – slide 96
    Gas Marketing Natural Gas Sales Gas Sales 2014 2016* Midwest In-Basin 71% 50% TETCO M3 Exports 29% 50% Dominion South 100% 100% * CY2016 Targets TCO Pool TETCO M2 East Tennessee Gas Sales Current Columbia (TCO) 25%…
  97. 3Q Company Presentation – Consol Energy Inc. – slide 97
    Gas Marketing Natural Gas Sales - Basis Risk Chicago MIchCon CY 2014: 0.86 CY 2014: 0.84 CY 2016: - 0.07 CY 2016: -0.03 TETCO M3 Dominion South CY 2014: 0.05 CY 2014: - 1.16 CY 2016: - 0.31 CY 2016: - 1.12 TCO Pool Basis…
  98. 3Q Company Presentation – Consol Energy Inc. – slide 98
    Gas Marketing Natural Gas Sales - Volatile Prices Natural gas prices and basis values are expected to remain volatile over time Manage price risk by adding program, supplemental, and basis hedges Manage basis risk by developing a…
  99. 3Q Company Presentation – Consol Energy Inc. – slide 99
    Gas Marketing Natural Gas Sales - Pipeline Projects MichCon CY 2014: 0.84 CY 2016: -0.03 Dominion South CY 2014: - 1.16 MichCon Pipeline Project CY 2016: - 1.12 TETCO M2 CY 2014: - 1.11 CY 2016: - 1.13 Southeast…
  100. 3Q Company Presentation – Consol Energy Inc. – slide 100
    Gas Marketing Natural Gas Processing Contracted capacity meets current requirements Options for additional volumes under our existing contracts Maximize realizations by taking advantage of the liquids value uplift Utilize the…

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