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Wells Fargo Energy Symposium – Gastar Exploration, Ltd.

Gastar Exploration, Ltd. · Dec 20, 2015 · 49 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. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 1
    Wells Fargo Energy Symposium December 2015 E XPANDING 2015 Gastar Exploration Inc. O UR H ORIZONS 1
  2. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 2
    Company Profile Asset Overview (09/30/2015) Q315 Net Prod. by Region Mid-Continent 5.7 MBoe/d Utica Dry Gas(1) Marcellus Shale Play Appalachia 42% 10,200 net acres leased 37,400 net acres 7.9 MBoe/d 58% Hunton Limestone Oil Play…
  3. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 3
    Key Investment Criteria Strong drilling results in the Hunton Limestone oil play High-Quality Resource Offset STACK Play wells (Meramec-Osage-Oswego-Woodford) successful Base NE stack play of prolific high rate dry gas Utica under…
  4. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 4
    Proven Track Record of Growth Significant reserves and production growth through acquisitions and the drill bit Proved Reserves by Product(1) 120.0 Gas Liquids 96.0 91.4 72.0 53% MMBoe 54% 48.0 45% 24.0 23% 28% 47%…
  5. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 5
    Production Growth YTD Average Production has grown 31% over 2014 Average Total Daily Production(1) 15.0 13.4 12.0 3.1 10.2 53% 8.9 Liquids 9.0 2.2 1.4 3.9 MBoe/d 31% 48% Liquids Liquids 1.4 2.7 6.0 3.0 6.1…
  6. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 6
    Mid-Continent Acquisition Overview Take over operatorship and increase interest in core Mid-continent area Deal Overview Hunton Asset Map 43.3MM purchase price In addition to gross proceeds, conveyance of 11,000 net…
  7. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 7
    Summary Target Economics (As prepared by Wright & Co.) 635 net locations for Hunton, Marcellus and Utica, additional 279 net locations in STACK Play Operated and Non- Operated WEHLU Operated WEHLU Operated Hunton Upper Hunton Lower…
  8. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 8
    2015 Capital Budget 88% of drilling budget operated, provides financial flexibility Current 2015 Budget Area Capital (MM) % of Total Mid-Continent Operated 69 53% Drilling and Infrastructure Land Mid-Continent Non-Operated 12 9%…
  9. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 9
    HUNTON & STACK PLAYS 2015 Gastar Exploration Inc. 11
  10. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 10
    Hunton: First Mover Advantage Large, contiguous acreage position with multiple horizontal targets Asset Overview Hunton Asset Map 105,700 net acres Low all-in acreage cost due to non-core lease sales WEHLU acquisition increased oil…
  11. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 11
    Oklahoma Hunton Play Overview Hunton Activity Map Successful drilling results, leading to development De-risking by industry activity and historic vertical production in the area Oklahoma Hunton Statistics 1P Reserves: 38.1…
  12. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 12
    Operated Hunton Development 2015 Development Plan Operated Activity Map Focus is on WEHLU Recently finished drilling last well for this year Lower Hunton Development 12 horizontal operated wells drilled over large geographic area…
  13. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 13
    Operated Hunton Potential - WEHLU Hunton offers a substantial source of high return projects Upper Hunton Overview Lower Hunton Overview 45 PUDs on northern WEHLU acreage Previous operator drilled no horizontal producing wells on…
  14. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 14
    Non-Operated AMI Activity Overview Non-Operated Activity Map AMI established in 2012 to focus on Lower Hunton development Have drilled 37 wells in the Lower Hunton and 2 wells in the Upper Hunton 55 gross PUDs booked on AMI…
  15. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 15
    Non-Operated AMI Average Well Performance Production averages in line with current type curve 800 640 74% (Boe and % Oil) 480 67% 320 77% 74% 72% 70% 71% 67% 65% 66% 160 67% 66% 64% 76% 0 Peak Rate…
  16. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 16
    STACK Play Stratigraphic Column Overview 5 Prospective formations across acreage position Multiple formations may be stacked depending on specific area Multiple benches within perspective formations Offers large quantity of…
  17. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 17
    STACK Meramec/Osage Overview Meramec/Osage/Miss Lime Activity Map(1) Offset operator IPs range up to 1,600 Boe/d (98% oil) Meramec play naturally fractured carbonate similar to Hunton Other operator activity de-risking the play…
  18. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 18
    STACK - Oswego Overview Oswego Activity Map(1) Offset operator IPs up to 2,000 Boe/d (93%+ oil) Has become a growing horizontal target in the basin Two porosity-driven targets within the Oswego called the Oswego 2 & 3…
  19. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 19
    STACK - Woodford Overview Woodford Activity Map(1) Offset operator IPs up to 1,000 Boe/d (84%+ oil) Gastar acreage unexplored Other operator activity de-risking the play Non-operated participation Woodford Statistics Net…
  20. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 20
    Oklahoma Summary 2015 Capital Budget Activity Hunton Wells spud - 15.0 gross (13.2 net) wells 12.0 gross (11.8 net) operated Hunton wells 3.0 gross (1.4 net) non-operated AMI Hunton wells Hunton Wells completed - 23.0 gross (17.5…
  21. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 21
    MARCELLUS AND UTICA 2015 Gastar Exploration Inc. 23
  22. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 22
    Core Position in the Marcellus and Utica Acreage position lies near other leading players in the basin Appalachia Overview Marcellus and Utica Map Core acreage proven in both the Utica Marcellus wet gas and the Utica dry gas Dry…
  23. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 23
    Infrastructure Overview Operational Improved run-time No flow restrictions expected Processing Total system capacity to 720 MMcf/d Central receipt point capacity 155 MMcf/d Adequate takeaway capacity Firm transport 50…
  24. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 24
    NE Basis Gas and NGL basis differentials widened in 2015 Gas infrastructure buildout to alleviate REX reversal to west August 1, 2015 1.8 Bcf 15 Bcf/d of incremental takeaway capacity announced since YE 2013 Source: Tudor…
  25. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 25
    Marcellus Shale Activity concentrated in liquids-rich portion of the play Marshall & Wetzel Counties, W. Va. Gross Appalachia Production Atinum 50% JV Partner High Btu gas and condensate yields 3040 Bbls/MMcf condensate 4050…
  26. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 26
    Marcellus Shale Development Development Plan Marcellus Drilling Locations Gastar has drilled and completed Marshall Co. - Marcellus Wells 74 gross (35.4 net) horizontal wells Producing - 74 PUDS 51 and one vertical well to date…
  27. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 27
    Utica Shale Acreage position lies in core of the Dry Gas Window Overview Utica Activity Map(1) Underlies core 10,400 acre Marcellus Rice GPOR Hess 2 wells 1 well position IP: 42 MMcfe/d (Bigfoot 9H) IP: 2945 MMcfe/d IP: 25 MMcfe/d…
  28. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 28
    Utica Shale Development Development Plan Utica Drilling Locations Blake well completed, 6,600 lateral Marshall Co. - Utica Wells Blake U-7H with 34 stage frac 6600 Lateral Length Producing - 2 Future Locations - 77 15.9MM D&C…
  29. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 29
    Utica Shale Development Blake U-7H and Simms U-5H demonstrate the repeatability of dry gas Utica across Gastars Marshall County position Blake U-7H Simms U-5H Initial production date 05/18/15 08/29/14 Initial 48 hours sales rate…
  30. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 30
    Point Pleasant Paleography and SSTVD Structure East and West Appalachian Acreage on same shelf with similar features Point Pleasant Paleogeography Point Pleasant SSTVD Structure GST SIMMS IP: 29.4 MMCF/D BLAKE IP: 36.8…
  31. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 31
    Appalachia Summary 2015 Capital Activity Completed 7.0 gross (3.5 net) Marcellus wells Completed 1.0 gross (0.5 net) Utica wells Net Drilling Locations 57 net Marcellus locations on existing acreage 54 net Utica locations on…
  32. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 32
    FINANCIAL OVERVIEW 2015 Gastar Exploration Inc. 34
  33. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 33
    Financial Strategy Goal: Grow NAV and reserves per share through exploitation of existing assets Maintain acceptable leverage and coverage ratios given commodity price environment Leverage Ratios and Financial flexibility through…
  34. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 34
    Capitalization and Liquidity Capitalization ( in millions) 09/30/2015 Cash 10.4 Long Term Debt Senior Secured Notes due 2018, net (maturity value) 325 Revolving Credit Facility 80.0 Total Debt 405.0 Stockholders Equity Preferred…
  35. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 35
    PDP Hedging Program Oil and NGLs Hedging Strategy 5,000 4,000 80.00 77.71 74.73 3,000 (Bbl/d) 63.50 2,000 1,000 0 (1) (2) 2015 2016 2017 2018 Volume Average Hedge Floor Price (/Bbl) Downside Hedged % (3) 83% 62% 60%…
  36. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 36
    Realized Prices - Historical Realized Oil Prices Realized Gas Prices 90.00 93% 91% 90% 100% 6.00 100% 81% 80% 81% 79% 78.00 72% 75% 80% 4.80 80% 85.12 66.00 70.91 81.75 60% 3.60 60% 49% 65.45 54.00 40% 2.40 3.21 3.02 3.41 40%…
  37. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 37
    Production Costs Historical (/Boe) Lease Operating Expense Transportation 9.00 4.00 3.51 7.20 6.74 3.20 (1) 5.26 5.07 2.25 5.40 2.40 3.60 2.80 2.92 1.60 1.24 1.80 0.80 0.56 0.45 0.00 0.00 2011 2012 2013 2014 YTD'15 2011…
  38. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 38
    Realized Prices by Area YTD15 Realized Oil Prices Realized Gas Prices 60.00 120% 6.00 120% 102% 100% 50.00 90% 96% 4.80 96% 40.00 72% 3.60 72% 48.54 42.94 49% 30.00 36% 48% 2.40 2.76 48% 34% 29% 20.00 17.24 24% 1.20 24%…
  39. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 39
    Production Costs by Area YTD15 (/Boe) Lease Operating Expense Transportation 12.00 1.00 Workover expense 9.32 0.83 9.60 0.80 0.67 2.39 7.20 0.60 5.07 0.45 4.80 1.06 0.40 6.94 2.40 0.20 4.01 1.93 0.01 0.20 0.00 0.00…
  40. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 40
    Key Investment Criteria Strong drilling results in the Hunton Limestone oil play High-Quality Resource Offset STACK Play wells (Meramec-Osage-Oswego-Woodford) successful Base NE stack play of prolific high rate dry gas Utica under…
  41. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 41
    APPENDIX 2015 Gastar Exploration Inc. 43
  42. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 42
    Lower Hunton Non-Operated Drilling Overview Well Results Cumulative Production Averages(2) Date Flowback Peak Approx. NRI % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Current 5 Day Average(3) % Oil(4) (Boe/d)…
  43. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 43
    Lower/Upper Hunton Drilling Overview Well Results Cumulative Production Averages(2) Approx. NRI Date Flowback Peak % Commenced Rate(1) 30 Day 60 Day 90 Day 180 Day 270 Day 360 Day Current 5 Day Average(3) % Oil(4) (Boe/d) Operated…
  44. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 44
    Utica Acreage is the dry gas Core of the Core Point Pleasant Shale Point Pleasant Shale Porosity Cross-Section Porosity Cross-Section A A GASTAR SIMMS U-5H 4-6% Porosity Up to 17% Porosity VERY HIGH Landing point…
  45. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 45
    Utica Shale Development Utica Dry Gas Comparative Statistics(1) 1. Other operator data obtained from third-party company data, investor presentations, public filings and other sources that have not been independently verified by…
  46. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 46
    Point Pleasant Gross Isopach Thickness Low thickness variations in the Point Pleasant across Gastars acreage GPOR Irons 4H EQT IP: 30.3 MMcf/d CVX Scotts Run Pad Conner 6H IP: 72.9 MMcf/d IP: 25 MMcf/d Eclipse Shroyer 2H &…
  47. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 47
    Utica Activity around Marshall & Wetzel Counties (1) 1. Other operator data obtained from third-party company data, investor presentations, public filings and other sources that have not been independently verified by Gastar…
  48. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 48
    Simms/Dangel Cross-Section Statoil USA Onshore Prop Inc Dangel 1-H Gastar Simms U-5H 5 Miles to west of Gastars acreage Target Depth: 11,350 TVD Porosity: 6 12% Porosity: Avg. 11% (up to 17%) Net pay of +/- 74 Net pay of 92…
  49. Wells Fargo Energy Symposium – Gastar Exploration, Ltd. – slide 49
    Hedge Detail Natural Gas Oil Period Contract Type Volume Hedged Price Period Contract Type Volume Hedged Price Oct - Dec 15 NYMEX Swap 400 MMBtu/d 4.00 Oct - Dec 15 3-Way 400 Bbl/d 85.00 / 70.00 / 96.50 Oct - Dec 15 NYMEX Swap 2,500…

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