Laramie Energy, LLC EnerCom Conference August 18, 2016
Laramie Energy LLC - Introduction Laramie Energy, LLC is a Denver-based natural gas and oil development company funded by management, public, and private equity. Introduction Public Equity: Par Pacific Holdings Private Equity:…
Colorados Piceance Basin One of North Americas largest accumulations of natural gas 5 of the top 50 gas fields in the USA Peaked at over 1.6 Bcf/d of production 20% of all Rockies gas production 84% gas, 16% NGLs and condensate…
Laramie Energy Brief History Laramie I (2004 to 2007) Invested 210 million of equity and 180 million of bank debt in the Piceance Basin Drilled over 200 wells by ramping up to a 5-rig program Built-out the areas midstream system…
Piceance Basin Keys for Success Land / Contracts High lease Net Revenue Interests (NRIs) Favorable Surface Use Agreements (surface ownership is valuable) Optionality in Gathering & Processing Contracts Operations Manufacturing…
Advantaged Interstate Pipeline Takeaway Capacity & Markets Unlike the Eastern U.S., the Piceance Basin has completely unconstrained pipeline takeaway capacity due to the construction of REX and Ruby pipelines and expansions of Kern…
Rockies Differentials to NYMEX vs. Eastern U.S. Attractive Rockies basis differentials due to regional demand and ample pipeline capacity Northwest Rockies Index Dominion South Index Rockies Basis Strengthening Eastern Basis…
Laramie Overview Summary Information 100% focused in Piceance Basin +1,200 operated producing wells, +400 non-operated All vertical/directional except for 2 horizontal wells Production (June 2016): Net (w/ OBO) Gas: 109 MMcfd…
Primary Producing Formations Williams Fork Rollins Structure Map Mancos/Niobrara BH PSI Basin centered gas Fluvial deposition 3000 feet of stacked sand bars averaging 6 acres in size Sourced by Cameo Coals & Mancos Gas column…
Piceance Basin Development - Pad Drilling of Directional Wells Williams Fork Formation Laramies current drilling pattern: Stacked, tight-sand gas reservoir 3-columns of 21-wells Developed on 10-acre density using directional pad…
Drilling Demonstrating Repeatable Performance Significant Drill Cost & Time Reductions Achieved on Williams Fork Wells 12
Completions Update Cost Savings Through Sand-less Completions Sandless Completions 700 Savings from propantless fracs allows for increased job size without increasing AFE. Completion Cost (M) 600 Upcoming Completions 120 150…
Completions - Frac Size Vs Reserves (WF) Frac size (water volume) generally correlates to reserves EUR vs Completion Volume 2.4 2.2 2.0 Sand Fracs Upcoming Pads 1.8 120 150 MBBL/Well EUR (BCF) 1.6 1.4 28-11 Pad…
Owned Facilities Compression & Dehydration Assets 2 Major sites & 5 Minor sites 270 MMscfd / 45,000 HP in Compression Capacity Maintenance profile is excellent (high % runtime) Compression sites integrated to new drilling areas…
Owned Facilities Water Storage & SWD Infrastructure Cascade Creek 7 Ponds with 450k bbls of fresh & flowback storage Fully integrated pond, facility, SWD, & pipeline system 3 SWDs w/ 2000 bwpd capacity Collbran Valley 2x 500k bbls…
May Snapshot Lease Operating Expenses Operations May 2016 LOE Breakdown May LOE - Gross Operated /Month % Cumulative 8% 1 Labor 511,000 29% 29% 1% 2% 2 Salt Water Disposal 326,000 19% 48% 3% 29% 3 Compression 201,000 12% 60% 4% 4 Storm…
Drilling Program - Current D&C Cost Structure Cost/Well Collbran Valley Cascade Creek Road & Pad (1/20th) 20,000 13,400 Rig Mob (1/20th) 11,500 7,700 Drill & Case 375,000 585,000 Complete 415,000 474,000 Equip 65,000 58,000…
Collbran Valley - Williams Fork 1.9 Bcf Gross EUR/Well 100% WI 87% NRI 0.886 MM Gross Drill and Complete Cost Nymex Oil CIG Gas Price NGL Price NPV10 Price ROR (%) (/MMBtu) (/gal) (M/Well) (/bbl) 2.00 50.00 - 12 10% 2.25 50.00 -…
Well Count By Net Revenue Interest 2000 Well Count 1800 1600 1400 1200 1000 800 600 400 200 0 75% and 80% 80% and 82.5% 82.5% and 85% 85% and 87.5% 87.5% and 90% 90% and 92.5% 92.5% and 95% 95% BDU BRUSH CREEK…
Well Count Internal Rate of Return at Current Strip prices ROR Count by Field Williams Fork Only 1400 1200 1000 800 600 400 200 0 0% 0-5% 5-10% 10-15% 15-20% 20-25% 25-30% 30-35% 35-40% 40-45% 45-50%…
Mancos Shale 2nd Largest Shale Gas Resource Base in U.S. Mancos / Niobrara Structure Map Deep structure is similar to shallower structure (Rollins) except the base of the syncline moves North Collbran Valley is situated at…
Regional Mancos Stratigraphic Cross Section Regional section shows consistency of Mancos Stratigraphy across basin A A 47.2 Miles Twn-Rge-Sec : T7S R96W S34 Twn-Rge-Sec : T9S R95W S24 Twn-Rge-Sec : T9S R94W Twn-Rge-Sec S11 : T9S…
Mancos Resource Play with Stacked Horizontal Potential Laramie Laramie Energy Offset in Mancos/Niobrara Bywith Fairway High IP/EUR 8-14 H-Wells MM/d IP30s LE_OXY H- Well WPX Beast H-Wells Encana Hi IP Wells LE…
Mancos/Niobrara Horizontal Economics Art of the Possible Goal is to reduce drill and complete costs using latest lessons learned in the DJ Basin Niobrara Program Laramie Energy, LLC 1 Mile Niobrara Horizontal 1 Mile Niobrara Horizontal…
Laramie Energy Production Growth Strategy Summary Premier position in a prolific gas resource basin with the following attributes: Repeatable Competitive returns Long life Consistent results Significant running room Operating…
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