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March 2016 Investor Presentation – Matador Resources Company

Matador Resources Company · Mar 21, 2016 · 70 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. March 2016 Investor Presentation – Matador Resources Company – slide 1
    Investor Presentation March 2016 NYSE: MTDR
  2. March 2016 Investor Presentation – Matador Resources Company – slide 2
    Company Summary
  3. March 2016 Investor Presentation – Matador Resources Company – slide 3
    Matador History Predecessor Entities Foran Oil & Matador Petroleum Founded by Joe Foran in 1983 most participants are still shareholders today Foran Oil funded with 270,000 in contributed capital from 17 friends and family members;…
  4. March 2016 Investor Presentation – Matador Resources Company – slide 4
    Company Overview Exchange: Ticker NYSE: MTDR Shares Outstanding(1) 93.3 million common shares Share Price(1) 20.43/share Market Capitalization(1) 1.9 billion Actual Actual % YoY 2014 Results 2015 Results 2016 Guidance…
  5. March 2016 Investor Presentation – Matador Resources Company – slide 5
    Matador Resources Company Operations Overview Market Capitalization(1) 1.9 billion Avg Daily Production YE 2015(2) 24,955 BOE/d 55%* 33% of total production Almost no oil Oil (% total) 12,306 Bbl/d (49%) 64% of total natural gas…
  6. March 2016 Investor Presentation – Matador Resources Company – slide 6
    Matador Has Made Tremendous Progress Since its IPO At IPO(1): Today(2) Difference February 7, 2012 414 Bbl/d 11,547 Bbl/d Oil Production (6% oil) (49% oil) +28-fold 27 MMBOE 85 MMBOE Proved Reserves (4% oil) (54% oil)…
  7. March 2016 Investor Presentation – Matador Resources Company – slide 7
    Record Oil, Natural Gas and Total Production in 2015 Average Daily Oil Production Average Daily Natural Gas Production (Bbl/d) (MMcf/d) 12,306 75.9 Oil production up 35% YOY. Gas production up 81% YOY. 9,095 39.8 41.9 5,843…
  8. March 2016 Investor Presentation – Matador Resources Company – slide 8
    Matadors Proved Reserves and PV-10(1): 2013 2015 Haynesville/CV Delaware Basin 82.9 million, 13% 31.9 million, 5% Delaware Basin 246.2 million, 24% Haynesville/CV 51.9 million, 10% Haynesville/CV 193.4 million, 18% Delaware…
  9. March 2016 Investor Presentation – Matador Resources Company – slide 9
    Committed to Maintaining Strong Balance Sheet Preserved and enhanced liquidity through April 2015 equity and Senior Notes offerings, sale of certain Loving County midstream assets for 143 million(1) in October 2015 and May 2016 equity…
  10. March 2016 Investor Presentation – Matador Resources Company – slide 10
    Delaware Basin Southeast New Mexico and West Texas
  11. March 2016 Investor Presentation – Matador Resources Company – slide 11
    Delaware Basin Acreage Position and Recent Test Results TWIN LAKES 42,300 gross / 29,900 net acres Twin Lakes vertical pilot hole ARROWHEAD 47,400 gross / 16,900 net acres Hibiscus 08-19S-35E RN 124H 2nd BS Cleaning up…
  12. March 2016 Investor Presentation – Matador Resources Company – slide 12
    Delaware Basin Brushy Cyn. Understanding the Opportunities U. Avalon L. Avalon Most current unconventional plays target one or two zones across a trend area. 1st Bone Spring The Delaware Basin has over a dozen unique targets 2nd…
  13. March 2016 Investor Presentation – Matador Resources Company – slide 13
    Delaware Basin Inventory Continues to Increase Matador has identified up to 3,543 gross (1,417 net) potential locations(1) for future drilling on its Delaware Basin acreage Only 118 gross (71.1 net) locations are PUD locations at…
  14. March 2016 Investor Presentation – Matador Resources Company – slide 14
    Improved Wolfcamp Drilling Times Significantly in 2015 50 2014 Average 45 43 2015 Planned 40 35 2015 Best Well 35 32 Drilling Days 30 26 25 20 18 15 15 10 5 0 Loving County Wolfcamp Eddy County Wolfcamp Note:…
  15. March 2016 Investor Presentation – Matador Resources Company – slide 15
    2015 Wolf Area Drilling Cost Improvements 8.0 19% 7.4 Rigs Labor/ 7.0 20% Supply 9% 24% 6.0 Rentals 8% 22% Directional Drilling Costs, millions 5.0 6% 12% Fluids Casing/ 3% 12% Cement 4.0 10% 3.6 17% 3.0…
  16. March 2016 Investor Presentation – Matador Resources Company – slide 16
    2016 Anticipated Wolf Area Drilling Cost Improvements 8.0 7.4 Efficiencies 7.0 59% 6.0 Service Costs Drilling Costs, millions 5.0 41% 4.0 3.6 Efficiencies 50% Service Costs 50% 3.0 3.0 2.0 51% Savings 17%…
  17. March 2016 Investor Presentation – Matador Resources Company – slide 17
    2015 Wolf Area Completion Cost Improvements 5.0 4.6 Stimulation 4.0 52% Completion Costs, millions Location Surface 15% Rentals 3.0 12% CTU Drillout 12% Wireline 9% 2.4 2.0 1.0 0.0 H2 2014 Stimulation…
  18. March 2016 Investor Presentation – Matador Resources Company – slide 18
    2016 Anticipated Wolf Area Completion Cost Improvements 5.0 4.6 Efficiencies 17% Service Costs 4.0 83% 83% Completion Costs, millions 3.0 2.4 Efficiencies 25% Service Costs 75% More to 2.0 75% 1.8 come 1.0…
  19. March 2016 Investor Presentation – Matador Resources Company – slide 19
    2016 Anticipated Wolf Area Total Drilling and Completion Cost Improvements 12.0 Efficiencies 12.0 100,000 Cost Reduction ROR Increase 2% 44% 10.0 Drilling and Completion Costs, millions Service Costs 8.0 56% 6.0…
  20. March 2016 Investor Presentation – Matador Resources Company – slide 20
    Evolution of Permian Basin Frac Design Reservoir Specific Bone Spring 375 ft. Gen 1 Gen 2 75 ft. 2,000 lbs/ft 1,333 lbs/ft Coupled 500 Mlbs 40 Bbl/ft 20 Bbl/ft 75 cluster 7,500 bbl 50 cluster spacing spacing 4 wells 6…
  21. March 2016 Investor Presentation – Matador Resources Company – slide 21
    Wolf Prospect Area Continued Focus on Wolfcamp Development in 2016 2015 Accomplishments Reduced drilling times by 58% Reduced drilling and completion costs by 50% Generating repeatable results Norton Schaub ESP test a success First…
  22. March 2016 Investor Presentation – Matador Resources Company – slide 22
    Wolf Inventory Multi-Pay Development Potential Formation Development Well Costs(1)(2) (millions) EUR(3) (MBOE) % Oil 2nd Bone Spring 4.0 5.0 400 500 50 65% Wolfcamp A-X/Y 5.5 6.5 650 1,100 65 80% Total Est. Full Development…
  23. March 2016 Investor Presentation – Matador Resources Company – slide 23
    Drilling Wells in Batch Mode / Central Production Facilities Dick Jay / Barnett Development (Cross-Section View) Dick Jay / Barnett Development (Top-Down View) Dick Jay Pad Barnett Pad Barnett 2nd Bone Dick Jay 124H Spring…
  24. March 2016 Investor Presentation – Matador Resources Company – slide 24
    Wolf Area Wolfcamp A-X/Y Wells Continue Strong Performance Across Acreage 10,000 Dorothy White 1H has produced 480 MBOE (69% oil) in 24 months Norton Schaub 84TTTB33 WF 201H has produced 360 MBOE (68% oil) in 18 months Billy Burt…
  25. March 2016 Investor Presentation – Matador Resources Company – slide 25
    Wolf Estimated Returns by Formation Formation Development Well Cost(1)(2) (millions) EUR(3) (MBOE) % Oil 2nd Bone Spring 4.0 - 5.0 400 500 50 65% Wolfcamp A-X/Y 5.5 - 6.5 650 1,100 65 80% Wolfcamp AX/Y 2nd Bone Spring 200…
  26. March 2016 Investor Presentation – Matador Resources Company – slide 26
    Stacked Horizon Test at Jackson Trust Multi-Well Pad Delaware Basin Jackson Trust C12-TTT-C24 021H Brushy Cyn. Preparing to install ESP(1) Jackson Trust C12-TTT-C24 101H Avalon Improved significantly on ESP Currently(1) at…
  27. March 2016 Investor Presentation – Matador Resources Company – slide 27
    Rustler Breaks Focus on Wolfcamp Development in 2016 2015 Accomplishments Identified multiple new horizons, particularly in the Wolcamp A-X/Y and Wolfcamp B Scott Walker 204H Reduced drilling times and well costs significantly 24…
  28. March 2016 Investor Presentation – Matador Resources Company – slide 28
    Rustler Breaks Inventory Multi-Pay Development Potential Formation Development Well Costs(1)(2) (millions) EUR(3) (MBOE) % Oil Bone Spring 3.0 4.0 300 600 80 85% Wolfcamp A-X/Y 5.0 6.0 600 800 80 85% Wolfcamp B 5.5 6.5 800 1,000 40…
  29. March 2016 Investor Presentation – Matador Resources Company – slide 29
    Rustler Breaks 5 Wells Producing From 3 Zones on Multi-Well Pad West (Section 14) East (Section 13) INTER-Formational Stacked Pay Gamma Ray 3 producing wells Multi-Well Pad 2 producing wells Resistivity Bone Spring Lime Upper…
  30. March 2016 Investor Presentation – Matador Resources Company – slide 30
    Rustler Breaks Well Cost Achievements Wolfcamp A Wolfcamp B 2nd Bone Spring Tiger 3 well stack costs: 19.5 million Combined Gross EUR: 2 MMBOE 2016 could result in 13.00/BOE net(1) 13.5 million total costs 9.00/BOE net(1) 10…
  31. March 2016 Investor Presentation – Matador Resources Company – slide 31
    Rustler Breaks Wolfcamp B Wells Performing Above Expectations 10,000 Rustler Breaks 1224S27E 224H has produced 233 MBOE (41% oil) in 20 months Tiger 1424S28E RB 224H has produced 218 MBOE (43% oil) in 9 months Janie Conner 1324S28E…
  32. March 2016 Investor Presentation – Matador Resources Company – slide 32
    Rustler Breaks Wolfcamp A-X/Y Wells Performing Above Expectations 10,000 Guitar 1024S28E RB 202H has produced 164 MBOE (78% oil) in 10 months Tiger 1424S28E RB 204H has produced 132 MBOE (81% oil) in 6 months Scott Walker 3622S27E RB…
  33. March 2016 Investor Presentation – Matador Resources Company – slide 33
    Rustler Breaks Estimated Returns by Formation Formation Development Well Cost(1)(2) (millions) EUR(3) (MBOE) % Oil Wolfcamp A-X/Y 5.0 6.0 600 800 80 85% Wolfcamp B 5.5 6.5 800 1,000 40 50% Rustler Breaks - Wolfcamp A-X/Y (85%…
  34. March 2016 Investor Presentation – Matador Resources Company – slide 34
    Single Wolfcamp B Well at Rustler Breaks Holds Up To 15 Potential Locations One producing Wolfcamp B well holds 320 surface acres and up to 15 additional potential locations for future development 320 - Acre Development Spacing…
  35. March 2016 Investor Presentation – Matador Resources Company – slide 35
    Ranger/Arrowhead Bone Spring and Wolfcamp Development in 2016 Iggles 21 State Com 1H - Tested 1,300 BOE/d (90% oil) CTA State Com 3H, 4H, 5H, 6H - Tested avg. 956 BOE/d (85% oil) Pickard State RN 124H Gobbler 5 B2PM 1H - On flowback…
  36. March 2016 Investor Presentation – Matador Resources Company – slide 36
    Ranger Inventory Multi-Well Development Potential Formation Development Well Costs(1)(2) (millions) EUR(3) (MBOE) % Oil Bone Spring 4.5 6.0 400 700 90 95% Wolfcamp 6.5 8.0 200 800* 80 85% * Based on Volumetrics and 4-8% Recovery…
  37. March 2016 Investor Presentation – Matador Resources Company – slide 37
    Arrowhead Inventory Multi-Well Development Potential Formation Development Well Costs(1)(2) (millions) EUR(3) (MBOE) % Oil Bone Spring 4.5 6.0 400 700 80 90% Wolfcamp 6.5 8.0 200 800* 80 85% * Based on Volumetrics and 4-8% Recovery…
  38. March 2016 Investor Presentation – Matador Resources Company – slide 38
    Ranger Area Bone Spring Wells Continued Strong Performance 10,000 Bone Spring Horizontals in Ranger Area Lea County, NM Ranger State 3320S35E RN 121H has produced 238 MBOE (91% oil) in 26 months (2nd Bone Spring) Ranger State…
  39. March 2016 Investor Presentation – Matador Resources Company – slide 39
    Testing New Oil Shale Play in Twin Lakes Prospect Pennsylvanian-Lower Wolfcamp D Oil Shale Porous Intervals 8% One of the primary source rocks for Twin Lakes prospect area (42,300 gross and 29,900 net acres) Super-charged area…
  40. March 2016 Investor Presentation – Matador Resources Company – slide 40
    Midstream
  41. March 2016 Investor Presentation – Matador Resources Company – slide 41
    Longwood Gathering and Disposal Systems(1) in Delaware Basin Loving County, TX Gas gathering Water gathering Salt water disposal Oil gathering Cryogenic gas processing plant Sold to EnLink Eddy County, NM Gas gathering and…
  42. March 2016 Investor Presentation – Matador Resources Company – slide 42
    Wolf - Loving County, TX Significant Midstream Footprint Gas Gathering Water Gathering Salt Water Disposal Oil Gathering Matador Acreage Note: All acreage at February 24, 2016. 43
  43. March 2016 Investor Presentation – Matador Resources Company – slide 43
    Rustler Breaks - Eddy County, NM Repeating the Proven Wolf Model Gas gathering and compression Cryogenic gas processing plant Water gathering (under evaluation) Salt water disposal (under evaluation) Matador Acreage Note: All…
  44. March 2016 Investor Presentation – Matador Resources Company – slide 44
    2016 Capital Investment Plan
  45. March 2016 Investor Presentation – Matador Resources Company – slide 45
    2016 Capital Investment Plan Summary We will keep the focus on our Delaware Basin assets and opportunities with the intent of creating and preserving long-term shareholder value Plan to run 3 rigs in 2016, but will consider dropping…
  46. March 2016 Investor Presentation – Matador Resources Company – slide 46
    2016 Capital Investment Plan Summary We will keep the focus on our Delaware Basin assets and opportunities with the intent of creating and preserving long-term shareholder value Plan to run 3 rigs in 2016, but will consider dropping…
  47. March 2016 Investor Presentation – Matador Resources Company – slide 47
    2016 Capital Investment Plan Summary We estimate our capital budget in 2016 to be approximately 325 million for the 3-rig case (down 33% from 2015(1)), declining to 277 million for the 2-rig case (down 43% from 2015(1)) We expect to…
  48. March 2016 Investor Presentation – Matador Resources Company – slide 48
    2016 Capital Investment Plan Summary We expect to grow oil production by about 11% and keep natural gas production close to flat; total BOE production growth of about 4% in the 3-rig program as compared to 2015 We expect to outspend…
  49. March 2016 Investor Presentation – Matador Resources Company – slide 49
    Matadors 2016 Delaware Basin Operated Drilling Plan: 3-Rig Case TWIN LAKES 42,300 gross / 29,900 net acres Wolf/Loving Area 21 gross (18.4 net) wells planned for 2016 ARROWHEAD 17 gross (15.2 net) wells on production, including…
  50. March 2016 Investor Presentation – Matador Resources Company – slide 50
    Delaware Basin Sensitivities to Oil Price(1) and Cost Savings Ranger/Arrowhead - 2nd Bone Spring (90% oil) Wolf - Wolfcamp A-X/Y (70% oil) 300 300 700 MBOE, 4.5 MM 1,000 MBOE, 5.5 MM 250 700 MBOE, 6.0 MM 250 1,000 MBOE, 6.5 MM 200…
  51. March 2016 Investor Presentation – Matador Resources Company – slide 51
    2016 Capital Investment Plan Summary 3 Delaware Basin Rigs 2016E CapEx 3-Rig Case 2016E CapEx of 325 million (3 rigs in the Delaware Basin throughout 2016) Decrease of 33% from 2015 capital expenditures of 482 million(1) 325 million…
  52. March 2016 Investor Presentation – Matador Resources Company – slide 52
    2016 Capital Investment Plan Summary 3-Rig and 2-Rig Cases 2016E CapEx 3-Rig Case 2016E CapEx 2-Rig Case (3 rigs in the Delaware Basin throughout 2016) (3 rigs in the Delaware Basin in Q1 2016; 2 rigs in Q2-Q4 2016) 325 million 277…
  53. March 2016 Investor Presentation – Matador Resources Company – slide 53
    2016 Oil and Natural Gas Production Estimates Oil and Natural Gas Production 3-Rig Case 2016E Oil Production 3-Rig Case (3 rigs in the Delaware Basin throughout 2016) 2016E CapEx: Estimated oil production of 4.9 to 5.1 million…
  54. March 2016 Investor Presentation – Matador Resources Company – slide 54
    2016 Oil and Natural Gas Revenue Estimates(1) Oil and Natural Gas Revenues 3-Rig Case 2016E Oil and Natural Gas Revenues (3 rigs in the Delaware Basin throughout 2016) 400 368 37% Revenues impacted by lower estimated 2016 realized…
  55. March 2016 Investor Presentation – Matador Resources Company – slide 55
    2016 Adjusted EBITDA Estimates Adjusted EBITDA(1)(2) 3-Rig Case (3 rigs in the Delaware Basin throughout 2016) 2016E Adjusted EBITDA(1)(2) 400 Shows impact of EnLink transaction in 2015 Estimated Adjusted EBITDA(1)(2) of 120 to 130…
  56. March 2016 Investor Presentation – Matador Resources Company – slide 56
    Commodity Price and CapEx Estimates Significantly Impact Forecasts Sensitivity of 2016E Adjusted EBITDA(1) to Oil Price 196 Relatively small improvements in oil price and service 200 cost reductions can significantly improve…
  57. March 2016 Investor Presentation – Matador Resources Company – slide 57
    Hedging Profile Remainder of 2016 Hedges(1) Oil: 2.3 million barrels of oil hedged for remainder of 2016 at weighted average floor and ceiling prices of 42/Bbl and 61/Bbl, respectively Over 50% of oil hedged for remainder of 2016…
  58. March 2016 Investor Presentation – Matador Resources Company – slide 58
    Credit Agreement Status Strong, supportive bank group led by Royal Bank of Canada Borrowing base reaffirmed on October 16, 2015 at 375 million based on June 30, 2015 reserves Maturity of credit facility extended from December 2016 to…
  59. March 2016 Investor Presentation – Matador Resources Company – slide 59
    Summary and Initial 2016 Guidance (As Provided February 3, 2016) Plan to run 3 rigs in the Delaware Basin throughout 2016, but will reduce to 2 rigs as early as Q2 2016 if oil prices drop and remain below 30 per barrel Delaware Basin…
  60. March 2016 Investor Presentation – Matador Resources Company – slide 60
    Eagle Ford Oil Bank EAGLE FORD EAST EAGLE FORD ACREAGE TOTALS Measured Depth: 17,000 18,000 Nickel Ranch 39,000 gross / 29,300 net acres 80-acre spacing Hennig Uvalde Medina Gonzales Lewton San Antonio Love EAGLE FORD…
  61. March 2016 Investor Presentation – Matador Resources Company – slide 61
    Haynesville Operations Elm Grove Development Chesapeake Operated 2015 Haynesville Non-Op Program Producing Wells 22 gross (1.9 net) wells turned to sales throughout Tier 1 Haynesville in 2015 Currently Drilling or Completing…
  62. March 2016 Investor Presentation – Matador Resources Company – slide 62
    Delaware Basin A World Class Hydrocarbon System West East DELAWARE BASIN CENTRAL BASIN MIDLAND BASIN PLATFORM 23,000 Wolfcamp Sediment Fill Simpson Source Kitchens Now Unconventional Resource Plays 70,000 square mile…
  63. March 2016 Investor Presentation – Matador Resources Company – slide 63
    Spectrum of Unconventional Play Types In general there is no consensus on the what an unconventional reservoir is At Matador, we think of an unconventional reservoir as a spectrum of play types. The distribution and quality of these play…
  64. March 2016 Investor Presentation – Matador Resources Company – slide 64
    New Rig Technology for Horizontal Drilling Saving Time and Money 7,500 psi Pressure Rating Estimated reduction in drilling time of 20 to 25% in the lateral on Wolfcamp wells Telescoping Flex-joint Estimated reduction in drilling…
  65. March 2016 Investor Presentation – Matador Resources Company – slide 65
    Optimizing Artificial Lift Operations Across the Permian Basin Optimizing Gas Lift Operations Numerous 2nd Bone Spring wells on gas lift Accelerates production while reducing LOE Lower maintenance costs than beam pump Helps wells…
  66. March 2016 Investor Presentation – Matador Resources Company – slide 66
    Delaware Basin: ROR Relationship to Well Cost(1) Savings and Improved EUR(2) Increasing Year Oil Price Model 30 1st 6 mo. 2016 40 2nd 6 mo. 2016 50 2017 60 2018 for life Rustler Breaks Assumes 2.50/Mcf natural gas Wolfcamp A-X/Y…
  67. March 2016 Investor Presentation – Matador Resources Company – slide 67
    Proven Management Team Experienced Leadership Industry Matador Management Team Background and Prior Affiliations Experience Experience Joseph Wm. Foran - Matador Petroleum Corporation, Foran Oil Company, 35 years Since Inception…
  68. March 2016 Investor Presentation – Matador Resources Company – slide 68
    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,…
  69. March 2016 Investor Presentation – Matador Resources Company – slide 69
    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,…
  70. March 2016 Investor Presentation – Matador Resources Company – slide 70
    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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