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January 2016 Investor Presentation – Diamondback Energy, Inc.

Diamondback Energy, Inc. · Jan 8, 2016 · 28 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. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 1
    Investor Presentation January 2016
  2. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 2
    Diamondback Energy Overview Quality Acreage in Northern Midland Basin 85,000 net acres containing 2,500+ gross total locations Gaines Dawson Borden 700 gross locations economic at 40 WTI1 3Q15 production of 34.1 mboe/d (73% oil) Best…
  3. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 3
    Recent Highlights Production of 34.1 Mboe/d (25.0 mbbl/d oil), up 14% q/q Cash flow positive for the second consecutive quarter (excl. acquisitions) 3Q15 Review Increased production guidance for third time this year while expecting…
  4. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 4
    Robust, Multi-year Inventory Scenario Analysis1 WTI of Gross Years of Drilling Gaines Dawson Borden (/bbl) Locations of Rigs (at Midpoint)2 35 - 45 700 23 14 45 - 55 1,250 34 18 Andrews Martin Howard Spanish 55 - 65 1,500 46 15…
  5. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 5
    Wolfcamp A De-risked in Midland and Martin De-risked Wolfcamp A Based on offset activity and Diamondbacks initial results, management believes the Wolfcamp A is de-risked in Midland and Martin Counties Diamondbacks first operated…
  6. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 6
    Middle Spraberry De-risked in Midland and Martin Middle Spraberry Potential Based on offset activity and Diamondbacks initial results, management believes the Middle Spraberry is de-risked in Midland and Martin Counties Diamondbacks…
  7. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 7
    Best in Class Execution & Cost Optimization Days vs Depth Hz1 Diamondback Peers Midland/Martin/Andrews County Days Glasscock County 0 5 10 15 20 25 30 35 0 5 10 15 20 25 30 35 40 0 0 2,000 2,000 4,000 4,000 6,000 6,000 8,000…
  8. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 8
    Diamondback Has Reduced Costs in Current Commodity Environment Cooperation with service cost Breakdown of Current Costs1 providers and efficiency gains have Directional Services Overhead / led to further reductions in drill,…
  9. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 9
    Conservative Financial Management Cash Margins Have Consistently Exceeded Peers1,2 FY2014 Recycle Ratio1,3 /boe 467% FANG Peer Average 424% 75.00 Peer Avg: 344% 63.50 329% 342% 323% 65.00 58.55 210% 55.00 47.19 45.00 47.61…
  10. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 10
    Liquidity Strength Creates Capital Flexibility FANGs Liquidity and Capitalization Net debt to annualized 3Q15 EBITDA of 1.0x3 FANG's Capitalization as of 9/30/15 (MM) Bank group approved increase of FANGs borrowing base to Cash and…
  11. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 11
    Reserves Summary Proved Reserves Represent Over a Decade of Total Reserves Growth1 (MMboe) Reserve Life3 Proved Developed Acquisitions Proved Undeveloped VNOM Proved Developed VNOM Proved Undeveloped 117.22 Pro forma 2014 total…
  12. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 12
    Vipers Organic Growth and Yield Current Market Capitalization of 1.2 BN1 WTI Pricing Changes 110.00 Co-Bid Strategy with Diamondback 90.00 As a result of increasing production 70% since 70.00 3Q14, distribution has remained…
  13. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 13
    Diamondback Energy 2015 Guidance1 Diamondback Capex Budget ( - million) Diamondback Viper Energy Horizontal Drilling and Completion 285 315 Energy, Inc. Partners LP Net Production Mboe/d1 31.0 32.0 5.0 5.2 Infrastructure 20 30…
  14. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 14
    In Conclusion Diamondback Energy is a low-cost operator in one of the highest return basins. Complementary acreage additions Midland Basin focused Maintain operations excellence Efficient capital allocation Debt/Adjusted EBITDA…
  15. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 15
    APPENDIX 16
  16. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 16
    Resilient Lower Spraberry Economics in Spanish Trail Spanish Trail Lower Spraberry Economics 360% At 60 WTI, Generating 85-200% ROR 300% 240% Rate of return At 50 WTI, Generating 50-125% ROR 180% At 40 WTI, Generating…
  17. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 17
    Lower Spraberry Performance Midland Note: Daily production normalized for operational shut-ins. Type curves based on normalized 7,500 laterals; actual lateral lengths vary. 18
  18. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 18
    Lower Spraberry Performance Martin, Andrews & Dawson Note: Daily production normalized for operational shut-ins. Type curves based on normalized 7,500 laterals; actual lateral lengths vary. 19
  19. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 19
    Robust Multi-year Inventory Identified Net Potential Drilling Locations 2015 Acquisitions 996 3,620 673 1,814 73 232 64 Horizontal Additional 40-Acre Additional 20-Acre Total PUDs Horizontal PUDs 40-Acre Spacing Drilling…
  20. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 20
    Diamondback Energy Hedging Hedging1 Oil Swaps 2015 Average Bbls Per Day Average Price Per Bbl Oil Swaps 2015 Average Bbls Per Day Average Price Per Bbl First Quarter 15 LLS 6,344 95.57 Third Quarter 15 LLS 3,000 90.99 First…
  21. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 21
    Howard County Acreage Acquired in 2015 is Central to Some of the Best Well Results in the Midland Basin Wright 44-41 3H Gardner Unit 15-10 2H Adams 4201WA Element Smith SN 48-37 501H Occidental Element Energen IP30: 724 Boepd (91%…
  22. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 22
    Comparison to Spanish Trail 1 2 2015 Howard County Acquisition Acreage Map Oil in Place Oil in Place 2 30 MMBO/ 35 SQMI MMBO/ Spanish SQMI Trail 1 40 41 MMBO/ MMBO/ SQMI SQMI 93 100 32 MMBO/ 30 MMBO/ MMBO/ SQMI…
  23. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 23
    Lower Spraberry Type Curve & Economics at 50 Oil Midland County Type Curve Economics ROR Sensitivity EUR, 2 Stream Mboe 990 EUR Mboe Well Cost MM Peak 30 day IP, boe/d 1,030 650 810 990 1,200 Oil %, 2 stream basis 79% 5.5…
  24. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 24
    Midland County Wolfcamp B Type Curve & Economics at 50 Oil Type Curve Economics ROR Sensitivity EUR, 2 Stream Mboe 638 EUR Mboe Well Cost MM Peak 30 day IP, boe/d 808 600 638 700 750 Oil %, 2 stream basis 76% 5.5 22% 25%…
  25. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 25
    Downspacing and Stacked Pay Potential in Spanish Trail Upside Potential Increase from 6 to 8 per section Increase from 8 to 10 per section Increase from 4 to 8 per section Could see upside from downspacing and…
  26. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 26
    Viper Energy Partners Landmark IPO of Mineral Interests Viper Overview Gross Net Viper Energy Partners LP (Viper or VNOM) was formed by Royalty Acres Diamondback, which now owns 88% Acres Cash distribution of 0.20 per unit…
  27. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 27
    Viper Energy Partners Landmark IPO of Mineral Interests September 2013 - acquired 14,804 gross acres of minerals in the core of the Northern Midland Basin Non-traditional investment for an E&P company, unique opportunity with…
  28. January 2016 Investor Presentation – Diamondback Energy, Inc. – slide 28
    Development of Viper Energys Spanish Trail is Well Underway Operators Incentivized to Drill Two Dedicated Hz Drillers 21.4% average revenue interest in 15,460 gross acres in Midland County known as Spanish Trail Viper does not pay…

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