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January 2016 Investor Presentation – Range Resources Corp

Range Resources Corp · Jan 6, 2016 · 57 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 – Range Resources Corp – slide 1
    January 6, 2016 Company Presentation 1
  2. January 2016 Investor Presentation – Range Resources Corp – slide 2
    Ranges Keys for Success in the Current Environment Low cost structure with ability to continue driving costs lower Improving capital efficiency Expandable markets for natural gas, NGLs and condensate with better realizations…
  3. January 2016 Investor Presentation – Range Resources Corp – slide 3
    Driving Down Unit Costs 3.00 2.50 2.00 /mcfe 1.50 1.00 0.50 0.00 - 2008 2009 2010 2011 2012 2013 2014 2015E LOE(1) 0.99 0.82 0.72 0.60 0.41 0.36 0.35 0.28 Prod. Taxes 0.39 0.20 0.19 0.14 0.15 0.13 0.10 0.07 G&A(1) 0.49 0.51 0.55…
  4. January 2016 Investor Presentation – Range Resources Corp – slide 4
    Range: Low-Cost, Large Scale Company Total Reserves Breakeven Positions (tcfe) (US/mcf) Range 30.00 2.62 Range has both highest net risked Rex 3.19 2.66 resource and lowest breakeven price in Cabot 18.18 2.71 EQT 15.84 2.74 the…
  5. January 2016 Investor Presentation – Range Resources Corp – slide 5
    Sustained Growth with Improving Capital Efficiency Range has one of the most capital efficient spending programs in the sector 1,500 30 Capex per Incremental mcfe Production 1,250 25 Production (Mmcfepd) 1,000 20 750…
  6. January 2016 Investor Presentation – Range Resources Corp – slide 6
    Cost & Efficiency Improvements SW Pennsylvania Average Lateral Length Well Cost/Lateral Length 2,500 6,500 2,200 5,500 1,900 4,500 1,600 3,500 1,300 2,500 1,000 700 1,500 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015…
  7. January 2016 Investor Presentation – Range Resources Corp – slide 7
    Near-Term Pricing Enhancements Spectra Uniontown to Gas City Pipeline Moves 200 Mmcf per day of Range gas production as anchor shipper from local Appalachia M2 to Midwest markets effective September 1 Added 5.7 million incremental…
  8. January 2016 Investor Presentation – Range Resources Corp – slide 8
    Appalachia Gas Transportation Arrangements A Key Cost Component in the Current Cycle Projected YE 2015 Projected YE 2016 Projected YE 2018 Transport Transport Transport Mmbtu/day Mmbtu/day Mmbtu/day Regional Direction Cost per Cost…
  9. January 2016 Investor Presentation – Range Resources Corp – slide 9
    Liquidity and Leverage Outlook Following Nora sale, Range has 1.7 billion liquidity under bank commitments Substantial cushion between borrowing base and bank commitment to absorb price fluctuations and preserve liquidity Oklahoma…
  10. January 2016 Investor Presentation – Range Resources Corp – slide 10
    Range Marcellus 2015 Well Economic Summary SW Super-Rich SW Wet SW Dry NE Dry 12.9 Bcfe 17.6 Bcfe EUR 17.1 Bcf 15.2 Bcf 1,169 Mbbls & 5.9 Bcf 1,501 Mbbls & 8.6 Bcf EUR/1,000 ft. lateral 2.40 Bcfe 2.95 Bcfe 2.52 Bcf 2.67 Bcf…
  11. January 2016 Investor Presentation – Range Resources Corp – slide 11
    Gas In Place (GIP) Analysis Shows Greatest Potential in SW PA When GIP analysis from the Marcellus, Upper Devonian and Point Pleasant are combined, the largest stacked pay resource is located in SW PA where Range has concentrated…
  12. January 2016 Investor Presentation – Range Resources Corp – slide 12
    SW/NE Pennsylvania Stacked Pays Total (1) Wet Dry Net Acreage Acreage Acreage Upper Devonian 330,000 195,000 525,000 Marcellus 330,000 310,000 640,000 Utica/Point Pleasant - 400,000 400,000 660,000 905,000 1,565,000…
  13. January 2016 Investor Presentation – Range Resources Corp – slide 13
    Current Outlook for 2016 Capital Budget The 2016 Capital Budget amount & details is expected to be announced in February. The budget will be correlated with available cash flow and asset sales success. 20% Growth* 20% % Y-O-Y…
  14. January 2016 Investor Presentation – Range Resources Corp – slide 14
    U.S. Natural Gas Production is Slowing Supply has now declined by 1.6 Bcf/d since the April 2015 peak 73.0 71.0 BCF per day 69.0 67.0 65.0 63.0 Total US Natural Gas Production Source Bentek, Jefferies as…
  15. January 2016 Investor Presentation – Range Resources Corp – slide 15
    U.S. Natural Gas Production Growth has Slowed Considerably This marks the first Y/Y supply decrease since February 2010 and the second sequential monthly decline 12.0% 10.0% Monthly Y/Y % Growth 8.0% 6.0% 4.0%…
  16. January 2016 Investor Presentation – Range Resources Corp – slide 16
    Why Buy Range One of the lowest cost structures, which is expected to improve with increasing Marcellus contribution Ample liquidity with additional high quality divestible assets which can improve leverage First mover, low cost,…
  17. January 2016 Investor Presentation – Range Resources Corp – slide 17
    Appendix Portfolio Detail 18
  18. January 2016 Investor Presentation – Range Resources Corp – slide 18
    Range is Focused on Per Share Growth, on a Debt-Adjusted Basis Production/share debt adjusted Reserves/share debt adjusted 3.00 70.00 2.50 60.00 Mcfe/share 50.00 Mcfe/share 2.00 40.00 1.50 30.00 1.00 20.00 0.50…
  19. January 2016 Investor Presentation – Range Resources Corp – slide 19
    Utica/Point Pleasant Update OH PA 1st well estimated to have 15 Bcf EUR, or 2.8 Bcf per 1,000 lateral foot 2nd well completed with higher sand concentration and brought online in Q3 with choke management at 13 Mmcf per day 2nd…
  20. January 2016 Investor Presentation – Range Resources Corp – slide 20
    Significant U.S. Natural Gas Demand Growth Projected Additional 20 Bcfd of demand by 2020, plus an additional 15 Bcfd by 2025 * Source: EIA, Bernstein estimates * Exports include LNG and exports to Mexico 21
  21. January 2016 Investor Presentation – Range Resources Corp – slide 21
    U.S. LNG Exports Expected to be 8 Bcf/day by 2020 per TPH Research report dated 10/8/2015 22
  22. January 2016 Investor Presentation – Range Resources Corp – slide 22
    SW PA Super-Rich Area Marcellus Projected 2015 Well Economics Southwestern PA (High Btu case) EUR / 1,000 ft. 2.40 Bcfe NYMEX 12.9 EUR 12.9 Bcfe Gas Price Bcfe (182 Mbbls condensate, 987 Mbbls NGLs, and 5.9 Bcf gas) 3.00 - 26% Drill…
  23. January 2016 Investor Presentation – Range Resources Corp – slide 23
    Southwest PA - Super-Rich Area 2015 Turn in Line Forecast 3,000 Improvements Between Years EUR Well Costs Lateral (Bcfe) ( MM) Lengths (ft.) 2,500 2014 Type Curve - Drilling 12.3 6.8 5,300 Normalized Mcfe/Day per 1,000 ft. 2015…
  24. January 2016 Investor Presentation – Range Resources Corp – slide 24
    Southwest PA Super-Rich Marcellus Horizontal Length (TIL) Average Number of Stages 6,000 30 5,500 5,000 25 Stages 4,500 Feet 20 4,000 3,500 15 3,000 2,500 10 2,000 2013 2014 2015 5 Actual Actual Forecast 2013 2014…
  25. January 2016 Investor Presentation – Range Resources Corp – slide 25
    SW PA Wet Area Marcellus Projected 2015 Well Economics Southwestern PA (Wet Gas case) NYMEX 17.6 EUR / 1,000 ft. 2.95 Bcfe Gas Price Bcfe EUR 17.6 Bcfe (48 Mbbls condensate, 1,453 Mbbls NGLs, and 8.6 Bcf gas) 3.00 - 26% Drill and…
  26. January 2016 Investor Presentation – Range Resources Corp – slide 26
    Southwest PA - Wet Area 2015 Turn in Line Forecast 3,500 Improvements Between Years EUR Well Costs Lateral (Bcfe) ( MM) Lengths (ft.) 3,000 2014 Type Curve - Drilling 12.3 6.1 4,200 Normalized Mcfe/Day per 1,000 ft. 2,500…
  27. January 2016 Investor Presentation – Range Resources Corp – slide 27
    Southwest PA Wet Marcellus Horizontal Length (TIL) Average Number of Stages 6,500 35 6,000 5,500 30 5,000 25 Stages Feet 4,500 4,000 20 3,500 15 3,000 2,500 10 2,000 2013 2014 2015 5 Actual Actual Forecast 2013…
  28. January 2016 Investor Presentation – Range Resources Corp – slide 28
    SW PA Dry Area Marcellus Projected 2015 Well Economics Southwestern PA (Dry Gas case) NYMEX 17.1 EUR / 1,000 ft. 2.52 Bcf Gas Price Bcf EUR 17.1 Bcf 3.00 - 46% Drill and Complete Capital 6.0 MM, 4.00 - 101% (883 K per 1,000…
  29. January 2016 Investor Presentation – Range Resources Corp – slide 29
    Southwest PA Dry Area 2015 Turn in Line Forecast 6,000 Improvements Between Years EUR Well Costs Lateral (Bcf) ( MM) Lengths (ft.) 5,000 2014 Type Curve - Drilling 13.4 6.6 5,200 Normalized Mcf/Day per 1,000 ft. 2015 Type…
  30. January 2016 Investor Presentation – Range Resources Corp – slide 30
    Southwest PA Dry Marcellus Horizontal Length (TIL) Average Number of Stages 8,000 40 7,000 35 6,000 30 Stages Feet 25 5,000 20 4,000 15 3,000 10 2,000 5 2013 2014 2015 2013 2014 2015 Actual Actual Forecast EUR…
  31. January 2016 Investor Presentation – Range Resources Corp – slide 31
    NE PA Dry Area Marcellus Projected 2015 Well Economics Northeastern PA (Dry Gas case) EUR / 1,000 ft. 2.67 Bcf NYMEX 15.2 EUR 15.2 Bcf Gas Price Bcf Drill and Complete Capital 4.9 MM, 3.00 - 42% (865 K per 1,000 ft.) 4.00 - 140%…
  32. January 2016 Investor Presentation – Range Resources Corp – slide 32
    Northeast PA Dry Area 2015 Turn in Line Forecast 4,500 Improvements Between Years EUR Well Costs Lateral 4,000 (Bcf) ( MM) Lengths (ft.) 2014 Type Curve - Drilling 13.1 4.7 4,800 Normalized Mcf/Day per 1,000 ft. 3,500 2015…
  33. January 2016 Investor Presentation – Range Resources Corp – slide 33
    Northeast PA Dry Marcellus Horizontal Length (TIL) Average Number of Stages 6,000 30 5,500 5,000 25 4,500 Feet Stages 4,000 20 3,500 15 3,000 2,500 10 2,000 2013 2014 2015 5 Actual Actual Forecast 2013 2014 2015…
  34. January 2016 Investor Presentation – Range Resources Corp – slide 34
    10 20 30 40 60 50 0 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 peak in 2014 Mar-13 May-13 Jul-13 Source RigData as of 12/21/2015 Sep-13 down 69% from the Marcellus rig count Nov-13 Jan-14…
  35. January 2016 Investor Presentation – Range Resources Corp – slide 35
    BCF/d 58 74 60 62 64 66 68 70 72 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Source - ITG IR, Ventyx & Bloomberg Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15…
  36. January 2016 Investor Presentation – Range Resources Corp – slide 36
    U.S. Domestic Oil Production Appears to Have Peaked 7 major regions account for 95% of domestic oil production growth 6,000 Production appears to have peaked in 2nd Qtr. 2015 Significant reduction in Capital spending in the 7 regions…
  37. January 2016 Investor Presentation – Range Resources Corp – slide 37
    Y/Y Associated Gas Growth Now Near Zero We expect gas production from oil plays to continue to decline in 2016 due to a lack of drilling within these plays 20.0% 18.0% Monthly Y/Y % Growth 16.0% 14.0% 12.0% 10.0%…
  38. January 2016 Investor Presentation – Range Resources Corp – slide 38
    Results of Marcellus Tighter Spacing Pilot Projects Projects conducted in the Wet and Super Rich areas of the Marcellus 3,000 500 foot spaced wells produced 79% of 1,000 foot spaced wells over a five-and-a-half-year period 2,500…
  39. January 2016 Investor Presentation – Range Resources Corp – slide 39
    Targeting/Down Spacing Test Results Encouraging Average Normalized Time Zero Decline Curves 3500 Optimized targeting 700 ft. shows a 50% increase in 3000 spacing cumulative production after 500 days Average Mcfe/day per 1000…
  40. January 2016 Investor Presentation – Range Resources Corp – slide 40
    Ranges Natural Gas Liquids Provide Revenue Uplift 4.00 /Wellhead Gas 3.70 - 3.80 Range is one of the largest NGL 3.50 producers in 3.00 Appalachia, with the 1.70 - 1.80 highest Btu inlet gas 2.50 NGLs (C2+) Higher Btu gas…
  41. January 2016 Investor Presentation – Range Resources Corp – slide 41
    Marcellus NGL Pricing Weighted Avg. Realized Marcellus NGL Prices Composite Barrel (1) 2014 2015 1Q 2Q 3Q 4Q 1Q 2Q 3Q NYMEX WTI 11% 98.61 102.97 96.99 73.11 48.62 57.88 46.61 (per bbl) 11% Mont Belvieu 40% Weighted Priced 37.22…
  42. January 2016 Investor Presentation – Range Resources Corp – slide 42
    Range NGLs Add Cash Flow Range has the highest Btu gas and a large liquids resource base Range has size and scale Range has a competitive advantage in pricing as most large projects require/benefit from Ranges participation Ranges…
  43. January 2016 Investor Presentation – Range Resources Corp – slide 43
    Takeaway Largely Overbuilt by 2016-2017 50 LNG exports starting in late 2015 40 Appears to have sufficient takeaway capacity by 2016 30 Bcf/d 20 10 0 Appalcahia Consumption Regional Storage Injections Announced…
  44. January 2016 Investor Presentation – Range Resources Corp – slide 44
    Announced Appalachian Basin Takeaway Projects 1 of 2 Capacity Approved or Northeast PA Operator Main Line Market Start-up Bcf/d Fully Committed with FERC 2014 Northeast Connector Williams Transco NE Q4'14 0.1 Y Y Iroquois Access…
  45. January 2016 Investor Presentation – Range Resources Corp – slide 45
    Announced Appalachian Basin Takeaway Projects 2 of 2 Capacity Approved or Southwest Operator Main Line Market Start-up Bcf/d Fully Committed with FERC 2016 Gulf Expansion Ph1 Spectra TETCO Gulf Coast Q4'16 0.3 Y Y Clarington West…
  46. January 2016 Investor Presentation – Range Resources Corp – slide 46
    What Does the Futures Strip Price Indicate for Regional Basis Dawn 2015 +0.25 2020 -0.11 Algonquin 2015 +2.34 MichCon Transco Z6 2020 +1.27 Chicago CG 2015 +0.15 (NNY) 2015 +0.13 2020 -0.19 2015 +0.46 2020 -0.15 2020 +0.33…
  47. January 2016 Investor Presentation – Range Resources Corp – slide 47
    Gas In Place (GIP) Marcellus Shale GIP is a function of pressure, temperature, thermal maturity, porosity, hydrocarbon saturation and net thickness Two core areas have been developed in the Marcellus Condensate and NGLs are…
  48. January 2016 Investor Presentation – Range Resources Corp – slide 48
    Gas In Place (GIP) Point Pleasant Outlined portion represents the area of the highest pressure gradients in the Point Pleasant Note: Townships where Range holds 3,000 or more acres (as of 12/31/2014), and estimated as prospective, are…
  49. January 2016 Investor Presentation – Range Resources Corp – slide 49
    Gas In Place (GIP) Upper Devonian Shale The greatest GIP in the Upper Devonian is found in SW PA A significant portion of the GIP in the Upper Devonian is located in the wet gas window Note: Townships where Range holds 3,000…
  50. January 2016 Investor Presentation – Range Resources Corp – slide 50
    Appendix Financial and Reserve Detail 51
  51. January 2016 Investor Presentation – Range Resources Corp – slide 51
    Long Life Reserves Enhances Credit Profile Proved Developed Reserves / Production With a best-in-class reserve life 18.0x index, Ranges low production 16.0x Range well above the average decline provides more stable 14.0x 12.0x…
  52. January 2016 Investor Presentation – Range Resources Corp – slide 52
    Debt Maturities Range maintains an orderly debt maturity ladder 900 800 750 750 700 600 600 ( Millions ) 500 500 400 300 200 122 100 0 Interest Rate 1.8% 5.75% 5.0% 5.0% 4.875% Proforma Nora Sale: Senior…
  53. January 2016 Investor Presentation – Range Resources Corp – slide 53
    Strong, Simple Balance Sheet 3Q 2015 YE 2012 YE 2013 YE 2014 Q1 2015 Q2 2015 Q3 2015 Proforma Nora Sale ( in millions) Bank borrowings 739 500 723 912 364 987 122 Sr. Notes 750 750 750 Sr. Sub. Notes 2,139 2,641 2,350 2,350 2,350…
  54. January 2016 Investor Presentation – Range Resources Corp – slide 54
    Gas and Oil Hedging Status Volumes Hedged Average Floor Price Average Cap Price Period ( / Mmbtu) (Mmbtu/day) ( / Mmbtu) Gas Hedging 4Q 2015 Swaps 727,500 3.63 4Q 2015 Collars 145,000 4.07 4.56 2016 Swaps 745,874 3.24…
  55. January 2016 Investor Presentation – Range Resources Corp – slide 55
    Natural Gas Liquids Hedging Status Volumes Hedged Hedged (1) Period (bbls/day) Price (/gal) 4Q 2015 Swaps 12,000 0.55 Propane (C3) 2016 Swaps 5,500 0.60 Normal Butane 4Q 2015 Swaps 3,500 0.72 (NC4) 2016 Swaps 2,500…
  56. January 2016 Investor Presentation – Range Resources Corp – slide 56
    Track Record of Building Reserves at Low Costs YE 2009 YE 2010 YE 2011 YE 2012 YE 2013 YE 2014 Track Proved Record of 3.1Building 4.4 Reserves 5.1 at6.5 Low Costs 8.2 10.3 Reserves (Tcfe) Drill Bit Finding 0.69 0.59 0.76…
  57. January 2016 Investor Presentation – Range Resources Corp – slide 57
    Contact Information Range Resources Corporation 100 Throckmorton, Suite 1200 Fort Worth, Texas 76102 Main: 817.870.2601 Fax: 817.870.2316 Rodney Waller, Senior Vice President rwallerrangeresources.com David Amend, Investor…

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