2013 Analyst Day Presentation December 12, 2013 NYSE: MTDR
Welcome and Opening Remarks
Company Overview Completed IPO of 14,883,334 shares (12,209,167 primary) including overallotment at 12.00/share in March 2012 and Follow-on Offering of 9,775,000 shares including overallotment at 15.25/share in September 2013…
Keys to Matadors Success People We have a strong, committed technical and financial team in place and we continue to make additions and improvements to our staff and our capabilities Board and Special Advisor additions have…
Matador Execution History IPO (February 7, 2012) vs. Today What we said at IPO Metric At IPO(1) What weve done Today(7) 7.1 MBOE/d 13.5 MBOE/d 16x growth in Production 414 Bbl/d of oil 6,700 Bbl/d of oil oil production 6% oil 50%…
Matadors Continued Growth TOTAL OIL AND (1) (1) (1)(2) TOTAL OIL PRODUCTION NATURAL GAS REVENUES ADJUSTED EBITDA 2,050 260.0 185.0 115.9 Thousand Bbl 1,214 156.0 in millions in millions 67.0 49.9 30.6 34.0…
2013 Has Been an Excellent Year for Matador Technical improvements in all aspects of our Eagle Ford operations resulting in better wells for less money Drilling times and costs per well decreased significantly Improved hydraulic…
Matadors Continued Growth Average Daily Production(1) Oil Production Mix(1) (MBOE/d) (% of Average Daily Production) 11.7 48% 9.0 37% 7.0 3.9 2.3 1.5 7% 6% 4% 2% 2008 2009 2010 2011 2012 First 9 mo. 2008 2009 2010…
Todays Agenda Welcome and Opening Remarks Joseph Wm. Foran, Chairman and CEO Matthew V. Hairford, President 2014 Capital Investment Plan David E. Lancaster, Executive Vice President, COO and CFO Eagle Ford Operations and…
2014 Capital Investment Plan
Matador Resources Company Overview Market Capitalization(1) 1.4 billion Average Daily Production(2) 11,663 BOE/d Oil (% total) 5,584 Bbl/d (48%) Natural Gas (% total) 36.5 MMcf/d (52%) Proved Reserves 9/30/2013 44.2 million BOE %…
2014 Capital Investment Plan Summary Continue 3-rig program in 2014 2 rigs in Eagle Ford and 1 rig in Permian 2014 estimated capital expenditures of 440 million Increase of 19% from 2013 estimated capital expenditures of 370 million…
Oil/Liquids Focus Continues to Drive 2014 Growth 2014 Anticipated Drilling 2014 Anticipated First Sales(1) 2014E CapEx Gross Wells(2) Net Wells(2) Gross Wells(2) Net Wells(2) (in millions) Total Total % Total Total % Total % South…
2014 Oil and Natural Gas Production Estimates 2014E Oil Production Oil Production Midpoint(1) (Bbl/d) 10,000 Estimated oil production of 2.8 to 3.1 million barrels Increase of 40 to 50% from 2013, despite an average 8,000 of 5 to…
2014 Financial Estimates 2014E Revenues and Adjusted EBITDA(1)(2) Oil and Natural Gas Revenues(2) (millions) 350.0 340.0 Revenues and Adjusted EBITDA(1)(2) growth impacted by lower 2014 realized oil price estimate 300.0 260.0 2014…
Funding for 2014 Capital Investment Plan Anticipate funding 2014 capital expenditures through operating cash flows and borrowings under revolving credit facility 2.4 million barrels of oil (80 to 85% of estimated oil production)…
2014 Hedging Profile 2.4 million barrels of oil hedged for Oil Hedges (Costless Collars) 2014 at weighted average floor and 2014 Total Volume Hedged by Ceiling 2,414,000 Bbl ceiling of 88/Bbl(1) and 99/Bbl(1), Weighted Average Price…
Credit Agreement Status Strong, supportive bank group led by RBC Borrowing base at 350 million, based on June 30, 2013 reserves Current borrowings at 175 million; estimated borrowings outstanding of 200 million at YE 2013 Ability to…
2014 South Texas Plan Details 2014 projected capital expenditures of 318 million or 72% of total 2-rig program with almost all of the 2014 South Texas capital budget directed to the Eagle Ford shale Drill and/or complete or…
2014 South Texas Drilling Plan 2-Rig Program EAGLE FORD ACREAGE TOTALS Nickel EAGLE FORD CENTRAL/EAST Ranch 38,756 gross / 26,981 net acres Bexar 7,570 gross / 6,360 net acres Hennig 50 gross (47.0 net) wells planned in 2014; all…
2014 Permian Basin Plan Details 2014 projected capital expenditures of 109 million or 25% of total 1-rig program working in Lea and Eddy Counties, NM and Loving County, TX Drill and/or complete or participate in 12 gross (9.8 net)…
Permian Basin Acreage Position Permian Basin Total Twin Lakes 28,765 gross / 19,093 net acres Gross Acres(1) 65,185 acres Net Acres(1) 40,824 acres Acreage position in good neighborhoods, surrounded Indian Draw/Rustler Breaks by…
2014 Permian Basin Drilling Plan Twin Lakes 2014 Drilling Plan Highlights 28,765 gross / 19,093 net acres Estimated capital expenditures of 109 million, 1 including 30 million for land/seismic and facilities 12 gross (9.8 net)…
2014 Tier 1 Haynesville Shale Plan 2014 projected capital expenditures of 12 million or about 3% of total Estimated participation in 26 gross (1.5 net) non-operated wells, some already drilling in late 2013 2014 capital plan includes…
Tier 1 Haynesville and Elm Grove Cotton Valley Acreage Positions TIER 3: 2 4 Bcf BOSSIER CADDO TIER 2: 4 6 Bcf BIENVILLE TIER 1: 6 10+ Bcf MTDR CV Horizontal T. Walker 1H Elm Grove Cotton Valley: 49 Net Locations Tier 1…
Summary and 2014 Guidance Continue 3-rig program in 2014 2 rigs in Eagle Ford and 1 rig in Permian Eagle Ford development will continue to be the major driver of our growth in 2014 Permian drilling program designed to further evaluate…
Eagle Ford Development and Operations
Eagle Ford Overview Operations Summary 57 gross (50 net) wells(1) currently producing from the Eagle Ford Proved Reserves 9/30/2013 17.9 million BOE An increase in oil production from 330 Bbl/d(2) % Proved Developed 55% to 6,700…
Eagle Ford Well Costs and Estimated Ultimate Recovery (EUR) Nickel EAGLE FORD ACREAGE TOTALS Ranch 38,756 gross / 26,981 net acres EAGLE FORD EAST Hennig Well Costs: 8-10 million EUR: 600-1,000 MBOE Uvalde Medina Gonzales San…
Operational Improvements Overview Eagle Ford Drilling Days(1) West Central East Experience in the Eagle Ford has led to significant 19.2 20.1 24.7 reductions in drilling days and well costs 18.8 18.9 Drilling from four-well batch…
Pad Drilling
Batch Drilling Approx. 300,000 cost reduction per well when going from single well pad to a four-well batch drilled pad
Progression of Drilling Rig Technology from 2010 to 2014 Advancing Rig Technology HYDRAULIC CATWALK AC DRIVE ROUND 1600 HP INTEGRATED APEX RIG BOP WALKING RIG ELECTRIC SYSTEM BOTTOM MUD PUMPS TOP DRIVE (FAST MOVE) HANDLER…
Improvement in Drilling Efficiency Moving Towards Batch Drilling Single Well Drilling PAD Drilling BATCH Drilling EXPLORATION 2010 1/3 RIG 60-70% increase in 2011 2/3 RIG Rig Efficiency from 2012 - 2014 2012 2 RIGS 2013 1 1/2…
Artificial Lift Flowing Rod Pumping Gas Lifting Benefits of Gas Lift Accelerates production Accelerated Production Reduces LOE 300 Bbl/d Lower maintenance Helps wells recover faster from offset fracs 100 Bbl/d Time 39
Evolution of Matador Frac Design Gen 2 Gen 3 Gen 4 Gen 5 Gen 6 650 Mlbs 515 Mlbs Proppant 500 Mlbs 405 Mlbs 375 Mlbs Pumped(1) Fluid Volume 11,750 Bbl 11,750 Bbl Pumped 7,825 Bbl 9,550 Bbl 5,770 Bbl 300 ft. 0 ft.…
Frac Generation Comparison (all wells normalized to 5,000 horizontal) 120,000 120,000 110,000 GEN 2 (80 Acre) 110,000 GEN 2 (80 Acre) 100,000 100,000 GEN 4 (80 Acre) GEN 4 (80 Acre) 90,000 90,000 GEN 5 (80 Acre) GEN 5 (80…
Downspacing Program 40 80 Acre Spacing Development 1st Well on Lease 330 40 acre Test Wells 42
Downspacing Program Cumulative Production vs. Time 80,000 80,000 GEN 2 (80 Acre) GEN 2 (80 Acre) 70,000 70,000 GEN 4 (80 Acre) GEN 3 (80 Acre) 60,000 60,000 GEN 5 (80 Acre) Cumulative Production (Bbl) Cumulative Production…
Buda Wells Activity Since January 1, 2010 Blackbrush O&G Blackbrush O&G 8 Buda Completions Oppenheimer-101H May 2011 May 2013 Comp May 2013 Cum: 220 MBbl 6 mo avg:: 672 MMcf 251 Bbl/d 562 Mcf/d Cum: 45,759 Bbl Texas American Res…
Glasscock Ranch Seismic Mapping of Natural Fracture Trends Glasscock Ranch - Frio South Survey Amplitude at Time Slice Near Top Buda Fracture trends from MTDR Glasscock 2H Texas American Res Buchanan-1H consistent with seismic…
Permian Exploration and Operations
Permian Basin Matadors Next Major Growth Area Why the Permian The Permian Basin is a world class, stacked petroleum system that has been explored and developed for over 100 years with a solid base of infrastructure Over 30 billion…
Matadors Criteria for Screening and High-Grading Opportunities Basin Scale: Large basins, supercharged, stacked, petroleum systems Stratigraphically and structurally predictable Significant drilling and conventional production…
Wolf-Bone Geological Setting, Predicting Where the Better Rocks Are 265 mya End of Bone Springs Warmer Delaware Basin Delaware Mountain Group San Andres 1st, 2nd, 3rd Bone Spring Sands Yeso Abo Sands confined to channels…
Permian Basin Stratigraphy and Lower Permian Petroleum Systems GR RE S Bone Spring Lime Upper Avalon Shale Lower Avalon Shale First Bone Spring Low permeability sand Sand and carbonates Second Bone Spring Carbonate…
Permian Basin Petroleum Systems and The Wolfcamp Kitchens West East DELAWARE BASIN CENTRAL BASIN MIDLAND BASIN PLATFORM 23,000 Wolfcamp Sediment Fill Simpson Source Kitchens Now Unconventional Resource Plays 70,000 square…
Permian Basin Acreage Position Offsetting multi-billion barrels in TWIN LAKES basin flanking conventional fields Hydrocarbon migration route-ways Stacked conventional and RANGER- QUERECHO PLAINS unconventional reservoir…
Twin Lakes Area Cross Section A A Wolfcamp D/Cline 400ft TEST VOLUMES: 268 Bbl/d TEST VOLUMES: 350 Mcf/d 118 Bbl/d 0 WATER 625 Mcf/d 1155 WATER 54
Ranger-Querecho Plains Prospect Area Location of Matador 2013 test wells 11,655 gross (8,893 net) acres Concho 82 gross (58.6 net) locations AirCobra 12 2H 3rd Bone Spring 25 mo.cum: Primary Targets 296 MBbl; 201 MMcf 2nd…
Ranger 33 State Com 1H Frac Overview Proppant 18 total stages 525 Mlbs Pumped(1) 450,000 lbs per stage 400,000 lbs 30/50 white sand per stage Fluid Volume 11,250 Bbl 50,000 lbs resin-coated sand tail-in per stage Pumped 50-ft…
Ranger 33 State Com 1H Production History Flowing Pressure Oil Gas Choke 2000 1000 30 Choke Size (x/64) 1800 900 25 1600 800 20 12-9-13 24-hr IP: 23/64 Choke 1400 575 Bbl/d oil, 263 Mcf/d gas, 543 Bbl/d water 700 15 Flowing…
Wolf Prospect Area Location of Matador 2013 test wells Dorothy White 1H Loving Wolfcamp A 5,273 gross (3,311 net) acres Well Drilled Now Completing 50 gross (33.6 net) locations OXY Reagan-McElvain 1H Wolfcamp A IP: 570…
Dorothy White 1H Horizontal Well Profile VS Wolfcamp Large increase in gas units when we entered the X sand TVD Y Sand MD Gas Units 100% in target zone Managed pressure drilling techniques flaring while…
Indian Draw-Rustler Breaks Prospect Area Location of Matador 2013 test wells 10,028 gross (7,177 net) acres Rustler Breaks Riddle 31 1H Wolfcamp B Horizontal Test TVD 10,185 (15,255 MD) Mewbourne Oil Co. Layla 35 MD Fee 1H 103…
Haynesville Well Economics Tier 1 Area 300 8 Bcf - 8.0 MM D&C Cost 275 9 Bcf - 8.0 MM D&C Cost 250 10 Bcf - 8.0 MM D&C Cost Estimated Rate of Return, % 8 Bcf - 9.0 MM D&C Cost 225 9 Bcf - 9.0 MM D&C Cost 200 10 Bcf - 9.0 MM…
Matador Gracie Prospect Meade Peak Gas Shale WYOMING IDAHO UTAH WYOMING IDAHO UTAH Crawford Federal 1H Summary 76,500 gross (36,000 net) acres WYOMING Drilled Crawford Fed 1H in late 2012 Recently completed…
Summary and Closing Remarks/Q&A
Summary and 2014 Guidance Continue 3-rig program in 2014 2 rigs in Eagle Ford and 1 rig in Permian Eagle Ford development will continue to be the major driver of our growth in 2014 Permian drilling program designed to further evaluate…
2013 Analyst Day Presentation December 12, 2013 NYSE: MTDR
Appendix
Adjusted EBITDA Reconciliation The following table presents our calculation of Adjusted EBITDA and reconciliation of Adjusted EBITDA to the GAAP financial measures of net income (loss) and net cash provided by operating activities,…
PV-10 Reconciliation PV-10 is a non-GAAP financial measure and generally differs from Standardized Measure, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future net…
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