Goldman Sachs Global Energy Conference January 7, 2016
ANTERO THE BRIDGE TO BETTER OIL & GAS PRICES Highly Sustainable Business Model - Antero holds a leading position within the lowest cost U.S. basin, a large and growing production base, a substantial long-term hedge position, over 5.0…
HIGH RETURN LOCATIONS DRIVE VALUE CREATION 12/31/15 NYMEX Strip Pricing - Before Hedges At 12/31/2015 strip pricing, Antero has 2,450 locations with well economics that exceed 20% rate of 12/31/15 Strip Pricing - After Hedges return…
HEDGING INTEGRAL TO BUSINESS MODEL Hedging is a key component of Anteros business model which includes development of a large, repeatable drilling inventory Locks in higher returns in a low commodity price environment and reduces well…
HEDGE BOOK SUPPORTS FINANCIAL PROFILE 3,117 3,500 (12/31/15) Mark-to-Market Hedge Value (9/30/15) for BB / BBB E&P Credits (MM) 3,000 2,500 2,842 Antero exceeds closest credit peer by 2.3 billion BB Credit Peer 2,000 (9/30/15) 1,500…
STONEWALL PIPELINE IN SERVICE EBITDA IMPACT 2016 DOMS Strip: 1.54 2016 TETCO M2 Strip: 1.56 Variance to Nymex (0.95) Variance to Nymex (0.93) Pre Post Variance to TCO (0.77) Variance to TCO (0.75) In-Service In-Service Projected…
REALIZED PRICE ROAD MAP Anteros exposure to favorable gas price indices like Chicago, Gulf Coast, NYMEX and TCO is expected to increase to 95% by 2016 Improved 2016 realizations driven by Stonewall gathering pipeline which was placed…
NGL REALIZATIONS AND PROPANE HEDGES Realized NGL Prices as % of WTI(1) (/Bbl) Realized NGL C3+ Price WTI 120.00 100.00 98.01 93.03 Target 2016 NGL pricing of 37% of WTI based on 80.00 12/31/15 strip pricing 60.00 52.61 53.71 51.98…
ANTERO FIRM TRANSPORTATION APPROPRIATELY DESIGNED TO ACCOMMODATE GROWTH 2016 Firm Transport Antero projects firm transportation in excess of (BBtu/d) Total Firm Transport (4) equity gas production of approximately 1,550 3,600 3,525…
FIRM TRANSPORTATION PORTFOLIO PRESENTS MARKETING OPPORTUNITIES Illustrative Marketing Example: No Spread 2016 Projected Marketing Expenses: Unmarketable (EQT / M3) (/MMBtu) ( in millions, except per unit amounts) 2016E 2016E 2016E…
THE BRIDGE RESULTS IN OUTPERFORMANCE VS. PEERS Quarterly Appalachian Peer Group EBITDAX (MM)(1) For the second straight quarter, Antero has both the highest Y-O-Y AR: 1MM Peer Avg: 103MM EBITDAX and EBITDAX margin among Appalachian…
LEADING UNCONVENTIONAL BUSINESS MODEL Largest Core Liquids- Highest Growth Rich Position in Large Cap E&P Appalachia 2 3 Growth Liquids-Rich Most Active Operator High Return in Appalachia 1 4 Well Locations Drilling…
DRILLING MOST ACTIVE OPERATOR IN APPALACHIA COMBINED TOTAL 12/31/14 RESERVES Assumes Ethane Rejection Net Proved Reserves 12.7 Tcfe Net 3P Reserves 40.7 Tcfe Pre-Tax 3P PV-10 22.8 Bn Net 3P Reserves & Resource 53 to 57 Tcfe Net 3P…
GROWTH STRONG TRACK RECORD NET PROVED RESERVES (Bcfe) AVERAGE NET DAILY PRODUCTION (MMcfe/d) Marcellus Utica Marcellus Utica Guidance 1,785 15,000 1,800 12,683 12,000 1,400+ 1,200 9,000 1,007 7,632 6,000 4,283 600 522 2,844…
LIQUIDS-RICH LARGEST CORE POSITION Antero has over 3,000 undeveloped rich gas locations with an average lateral length of 6,800 in its 3P reserves as of 12/31/2014 Antero controls an estimated 37% of the NGLs in the liquids-rich…
WELL ECONOMICS WELL COST REDUCTIONS SUPPORT SUSTAINABLE BUSINESS MODEL Antero has reduced average well costs for a 9,000 lateral by 16% in the Marcellus and 18% in the Utica as compared to 2014 well costs At 12/31/2015 strip pricing,…
MIDSTREAM MLP (NYSE: AM) HIGHLIGHTS SUBSTANTIAL VALUE IN MIDSTREAM BUSINESS Corporate Structure Overview(1) Antero Resources Corporation (NYSE: AR) Public 9.9 Billion Enterprise Value(1) Ba2/BB Corporate Rating 33% LP Interest…
TAKEAWAY LARGEST FIRM TRANSPORTATION AND PROCESSING PORTFOLIO IN APPALACHIA Anteros natural gas firm transportation (FT) portfolio builds to 4.85 Bcf/d by YE 2018 with 87% serving favorable markets, with an average demand fee of…
HEDGING LARGEST GAS HEDGE POSITION IN U.S. E&P 3.1 billion mark-to-market unrealized gain based on 12/31/2015 prices 3.5 Tcfe hedged from January 1, 2016 through year-end 2022 COMMODITY HEDGE POSITION 2,500 Hedged Volume Average…
LIQUIDITY STRONG BALANCE SHEET AND FLEXIBILITY Antero Resources (NYSE:AR) Antero Midstream (NYSE:AM) 9/30/2015 Debt Liquid Non-E&P Assets 9/30/2015 Debt Liquid Assets Debt Type MM Asset Type MM Debt Type MM Asset Type MM Credit facility…
REALIZATIONS 3Q 2015 LEADING NATURAL GAS AND NGL REALIZATIONS NATURAL GAS PRICE REALIZATIONS(1) 3Q 2015 NYMEX: 2.77/MMbtu (/Mcf) Natural Gas Price Realization - Before Hedges Natural Gas Price Realization - After Hedges Median - After…
LEADERSHIP IN APPALACHIAN BASIN Antero has the largest proved reserve base, the largest core liquids-rich acreage position and is one of the largest producers in the Appalachian Basin Appalachian Producers by Proved Reserves (Bcfe) YE…
ASSET OVERVIEW 23
WORLD CLASS MARCELLUS SHALE DEVELOPMENT PROJECT 100% operated RJ SMITH PAD Operating 7 drilling rigs including BEE LEWIS PAD 30-Day Rate 1 intermediate rig 30-Day Rate 4-well combined 4-well combined 30-Day Rate of 422,000 net acres…
PROLIFIC PREDICTABLE RESULTS ACROSS ENTIRE MARCELLUS POSITION Anteros Marcellus well performance has continued to improve over time with a tight statistical range of results across its entire acreage position Marcellus PDP Locations…
WORLD CLASS OHIO UTICA SHALE DEVELOPMENT PROJECT 100% operated Operating 3 drilling rigs Cadiz Processing 147,000 net acres in the core rich gas/ Plant condensate window (73% includes processable rich gas assuming an 1100 Btu…
LARGE UTICA SHALE DRY GAS POSITION Utica Shale Dry Gas Acreage in OH/WV/PA(1) Antero has completed its first dry gas Utica well a 6,619 Chesapeake Rice Hess lateral in Tyler County, WV Bigfoot 9H Porterfield 1H-17 Hubbard BRK 3H…
ANTEROS FIRST UTICA DRY GAS WELL Antero recently drilled and completed its first dry gas Utica well in IP / 1,000 Lateral (MMcf/d) Range EQT CNX Tyler County, WV (Rymer 4HD) 5.0 10.0 Claysville SC 11H Scotts Run Gaut 4IH 5,420…
Antero Midstream (NYSE: AM) Asset Overview 29
ANTERO MIDSTREAM ASSET OVERVIEW Midstream Assets Utica Gathering and compression assets in core of rapidly Shale growing Marcellus and Utica Shale plays Acreage dedication of 434,000 net leasehold acres for gathering and…
ANTERO INTEGRATED WATER BUSINESS AM acquired ARs integrated water business for 1.05 billion plus earn out payments of 125 million at year-end in each of 2019 and 2020 The acquired business includes Anteros Marcellus and Utica…
ADVANCED WASTEWATER TREATMENT Antero has contracted with Veolia to integrate an advanced wastewater treatment complex into its water business Advanced Wastewater Treatment Illustrative Produced & Flowback Water Volumes Veolia will…
AMS FULL VALUE CHAIN BUSINESS MODEL Well Pad Condensate Gathering End Stabilization Users (Miles) YE 2014 YE 2015E Compression (Miles) YE 2014 YE 2015E Utica 16 19 Marcellus 62 76 Low Pressure Gathering Utica 35 36 Total 97…
KEY CATALYSTS 1 Large, low unit cost core Marcellus and Utica natural gas drilling Sustainability of inventory with associated liquids generates attractive returns supported Anteros Integrated by long-term natural gas hedges,…
APPENDIX 36
ANTERO CAPITALIZATION CONSOLIDATED ( in millions) 9/30/2015 Cash 27 Senior Secured Revolving Credit Facility 500 Midstream Bank Credit Facility 525 6.00% Senior Notes Due 2020 525 5.375% Senior Notes Due 2021 1,000 5.125% Senior…
FIRM TRANSPORTATION AND FIRM SALES PORTFOLIO Columbia Tennessee Momentum III EQT REX/MGT/ANR 7/26/2009 9/30/2025 11/1/2015 9/30/2030 9/1/2012 12/31/2023 8/1/2012 6/30/2025 7/1/2014 12/31/2034 ANR Local Distribution Firm Sales 1 Firm…
MARCELLUS SINGLE WELL ECONOMICS IN ETHANE REJECTION Assumptions Marcellus Well Economics and Total Gross Locations(1) Natural Gas 12/31/2015 strip Oil 12/31/2015 strip 80% 1,200 63% 1,010 1,000 Total 3P Locations NGLs 37% of…
UTICA SINGLE WELL ECONOMICS IN ETHANE REJECTION Assumptions Utica Well Economics and Gross Locations(1) Natural Gas 12/31/2015 strip 100% 300 83% 80% Oil 12/31/2015 strip 248 71% 250 Total 3P Locations 80% NGLs 37% of Oil Price…
NGL EXPORTS AND NETBACKS STEP-UP BY 4Q 2016 Upon in-service of Mariner East II, Antero will have the ability to market its propane and n-butane to international buyers, which we expect will provide uplifts of 0.16/Gal and 0.18/Gal,…
POSITIVE RATINGS MOMENTUM Moodys / S&P Historical Corporate Credit Ratings Moodys Upgrade Rationale S&P Upgrade Criteria The upgrade reflects Moody's expectation that Antero will continue to We could raise the ratings due to our…
ANTERO RESOURCES EBITDAX RECONCILIATION EBITDAX Reconciliation ( in millions) Quarter Ended LTM Ended 9/30/2015 9/30/2015 EBITDAX: Net income (loss) including noncontrolling interest 544.7 1,413.4 Commodity derivative fair value…
ANTERO MIDSTREAM EBITDA RECONCILIATION EBITDA Reconciliation Three months ended September 30, 2014 2015 Reconciliation of Net Income to Adjusted EBITDA and Distributable Cash Flow: Net income 34,290 42,648 Add: Interest expense 2,455…
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