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UBS Global Oil and Gas Conference – Denbury Resources Inc.

Denbury Resources Inc. · May 26, 2016 · 30 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. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 1
    UBS Global Oil and Gas Conference May 26, 2016 NYSE:DNR NYSE:DNR
  2. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 2
    A Different Kind of Oil Company 6.7 Tcf Gross proved Over CO2 reserves 1,100 As of 12/31/2015 miles of CO2 pipelines Operating Areas 1Q16 Tertiary Production Produced over Denburys Profile: 40,464 135 Million CO2 enhanced oil…
  3. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 3
    Responding to Oil Price Volatility REDUCE COSTS Accomplishments Nine consecutive quarterly reductions in recurring LOE 20% reduction in headcount in 1Q16; 30% reduction since YE14 OPTIMIZE BUSINESS Shut-in 2,800 BOE/d of production…
  4. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 4
    CO2 EOR Process CO2 EOR delivers almost as much production as primary or secondary recovery(1) Recovery of Original Oil in Place (OOIP) Primary 20% Secondary 18% (Waterfloods) CO2 EOR 17% (Tertiary) CO2 Oil Bank Remaining…
  5. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 5
    U.S. Lower-48 CO2 EOR Potential Up to 83 Billion Barrels of Technically Recoverable Oil(1)(2) 33-83 Billion of Technically Recoverable Oil(1,2) (amounts in billions of barrels) Permian 9-21 East & Central Texas 6-15 Mid-Continent…
  6. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 6
    Up to 16 Billion Gross Barrels Recoverable(1) in Our Two CO2 EOR Target Areas MT ND 2.8 to 6.6 Billion Barrels WY Estimated Recoverable in Rocky Mountain Region(2) Denbury-operated fields represent 10% of total potential(3)…
  7. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 7
    CO2 EOR in Gulf Coast Region Control of CO2 Sources & Pipeline Infrastructure Provides a Strategic Advantage Delhi(3) Tinsley(3) 45 MMBOEs 46 MMBbls Summary(1) Tinsley Jackson Dome Proved 144 Potential 396 Delhi Free State…
  8. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 8
    CO2 EOR in Rocky Mountain Region Control of CO2 Sources & Pipeline Infrastructure Provides a Strategic Advantage Cedar Creek Anticline Area(3) Summary(1) DGC Beulah MONTANA 260 - 290 MMBbls Proved 21 Potential 329 NORTH DAKOTA…
  9. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 9
    Ample CO2 Supply & No Significant Capital Required for Several Years Gulf Coast CO2 Supply Rocky Mountain CO2 Supply Jackson Dome LaBarge Area Proved CO2 reserves as of 12/31/15: 5.5 Tcf(1) Estimated field size: 750 square miles…
  10. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 10
    2016 Capital Budget & Production Guidance 2016 Capital Budget:200 Million 2016 Production Guidance (BOE/d) Capitalized 74,432 72,861 69,351 64,000 68,000 Items(1) 55 MM 145 MM Development Capital 2014 2015 1Q16 2016E…
  11. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 11
    Analysis of Shut-in Production 2,800 BOE/d of Shut-in Production Economic Scenarios for Shut-in Production(1) Reason for Shut-in Economic at Economic at 60+ 50 or below 40% Uneconomic 32% to produce 2,800 48% BOE/d 60%…
  12. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 12
    Update on Delhi Field NGL Plant Benefits Benefitsof ofthe Focus NGL the for NGL Plant 2016 Plant Will extract NGLs from our gas stream to be sold separately Will improve the Delhi flood with a purer CO2 recycle stream…
  13. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 13
    Significant Reductions in LOE WTI Price /BBL Optimizing our business to counter lower oil prices 9th consecutive quarterly reduction in recurring LOE per BOE - lowest level in 6 years 98.42 Recurring LOE(1) 53.27 /BOE 25.68…
  14. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 14
    CO2 Efficiencies = Significant Savings 979 35% REDUCTION SINCE 1Q15 762 705 678 634 Total Company Injected Volumes (MMcf/d) 1Q15 2Q15 3Q15 4Q15 1Q16 Change in Total Company CO2 Costs (/BOE) 0.31 (0.64) Increased 3.03…
  15. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 15
    1Q16 Peer Operating Margins /BOE 40 Highest Revenue per BOE in the Peer Group 35 29.76 30 25.62 23.99 25 22.57 22.34 21.69 21.33 21.00 20.28 19.91 19.27 19.04 18.62 20 15.78 Operating 15 13.23 Margin Avg. 9.70/BOE 9.99…
  16. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 16
    Liquidity & Debt Maturity Schedule AMPLE LIQUIDITY & NO NEAR-TERM MATURITIES(1) BANK CREDIT FACILITY: Borrowing Base In millions 1,050 681 million in liquidity Undrawn & Available 797 as of 3/31/16 681 615 622 Basket for 1 billion…
  17. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 17
    Oil Hedge Detail as of May 19, 2016 2Q16 3Q16 4Q16 1Q17 2Q17 WTI NYMEX Volumes Hedged (Bbls/d) 11,500 18,500 26,000 22,000 22,000 Fixed-Price Swaps Swap Price(1) 61.84 38.96 38.70 42.67 43.99 WTI NYMEX Volumes Hedged (Bbls/d) 2,000…
  18. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 18
    Key Takeaways Reduce costs Near-Term Focus Optimize business Reduce debt Preserve cash and liquidity Long-Term Visibility Our Advantages CO2 EOR is a proven process Long-lived and lower-risk assets Tremendous resource…
  19. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 19
    Appendix NYSE:DNR NYSE:DNR
  20. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 20
    CO2 EOR is a Proven Process Significant CO2 EOR Operators by Region Significant CO2 Suppliers by Region Gulf Coast Region Gulf Coast Region Denbury Resources Jackson Dome, MS (Denbury Resources) Permian Basin Region Permian Basin…
  21. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 21
    Actual Industry Recovery Curves Range of Recovery 10%-18% An auditors view, Mike Stell, Ryder Scott, Permian Basin Study Group, April 4, 2011 Reserve booking guidelines, Mike Stell, Ryder Scott, CO2 Conference, Midland…
  22. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 22
    Actual Curves Denbury Mature Fields Range of Recovery 11%-20+% NYSE:DNR 23
  23. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 23
    Pro Forma Capital Structure 1Q16 Activity Open-Market Debt Debt (in thousands) 12/31/2015 Repurchases Other 3/31/2016 Exchanges(1) Pro Forma Senior Secured Bank credit facility 175,000 55,521 79,479 310,000 310,000 9% Senior…
  24. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 24
    Senior Secured Bank Credit Facility Info Commitments & borrowing base 1.05 billion Redetermination Semi-annually May 1st and November 1st Maturity date December 9, 2019 Permitted bond repurchases Up to 225 million of bond…
  25. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 25
    Quarterly Change in Bank Credit Facility (In millions) 350 300 (14) 310 275 - 300 Capital Lease (64) Payments 250 Balanced Cash Flow and CapEx & Other Changes in 200 (56) Working & Accrued 175 Note Capital 150 57 (58)…
  26. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 26
    Production by Area Average Daily Production (BOE/d) Field 2013 2014 1Q15 2Q15 3Q15 4Q15 2015 1Q16 Mature area(1) 13,803 11,817 10,801 11,170 10,946 10,403 10,830 9,666 Delhi(2) 5,149 4,340 3,551 3,623 3,676 3,898 3,688 3,971…
  27. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 27
    NYMEX Oil Differential Summary Crude Oil Differentials per barrel 2013 2014 1Q15 2Q15 3Q15 4Q15 2015 1Q16 Tertiary Oil Fields Gulf Coast Region 7.86 2.11 (0.22) 2.04 0.98 (0.97) 0.60 (1.95) Rocky Mountain Region (14.24) (11.10)…
  28. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 28
    Analysis of Total Operating Costs Total Operating Costs /BOE 2013 2014 1Q15 2Q15 3Q15 4Q15 2015 1Q16 CO2 Costs 3.73 3.79 3.03 2.71 2.17 2.70(1) 2.66 1.97 Power & Fuel 5.36 5.93 5.88 5.28 5.77 5.43 5.59 5.26 Labor & Overhead 5.59…
  29. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 29
    Analysis of Tertiary Operating Costs Tertiary Operating Costs /BOE 2013 2014 1Q15 2Q15 3Q15 4Q15 2015 1Q16 CO2 Costs 6.82 6.87 5.39 4.69 3.79 4.72(1) 4.65 3.38 Power & Fuel 6.64 7.46 7.30 6.27 6.81 6.53 6.72 5.98 Labor & Overhead…
  30. UBS Global Oil and Gas Conference – Denbury Resources Inc. – slide 30
    CO2 Cost & NYMEX Oil Price 0.45 100 0.40 0.35 80 NYMEX Crude Oil Price / Bbl 0.30 CO2 Costs / Mcf 0.25 60 0.20 40 0.15 0.10 20 0.05 0.00 0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1…

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