Skip to main content DUG Permian Conference – Seaport Global Securities LLC Investor Presentation | Shale Experts
Loading...
Pm

DUG Permian Conference – Seaport Global Securities LLC

Seaport Global Securities LLC · May 25, 2016 · 22 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. DUG Permian Conference – Seaport Global Securities LLC – slide 1
    May 24, 2016 The Stampede to West Texas DUG Permian Basin May 25th, 2016 Mike Kelly, CFA Managing Director, Head of E&P Research (713) 658-6302 mkellyseaportglobal.com Seaport Global Securities LLC Equity Sales & Trading Toll Free:…
  2. DUG Permian Conference – Seaport Global Securities LLC – slide 2
    Todays Agenda: Permian Deal Metrics, Powder, Distress & Outlook for Further Transactions Wall Streets Permian love fest and the A&D implications Q1 developments big trends across the Permian Whats an acre really worth in the Permian…
  3. DUG Permian Conference – Seaport Global Securities LLC – slide 3
    Our Research Well Watcher Quarterly Macro Reports Published every Tuesday Quarterly macro report focus on a specific basin or macro Commentary on incremental data points (by basin) from topic operators To date, 3 Permian, 1 Utica,…
  4. DUG Permian Conference – Seaport Global Securities LLC – slide 4
    Equity Performance of Permian Pure-Plays WTI Permian E&Ps are up 26% YTD vs. XOP up 14% Peak Bottom Ticker QTD YTD 1-Year 3-Year 6/20/14 2/11/16 Since WTI peaked in June 2014, Permian E&Ps have CPE 26% 34% 34% 205% (2%) 82%…
  5. DUG Permian Conference – Seaport Global Securities LLC – slide 5
    Historical Valuations by Basin 20.0x Basin Current Median Minimum Maximum Permian 16.4x 5.8x 3.1x 16.4x Eagle Ford 12.3x 6.0x 3.2x 12.3x 18.0x Midcontinent 13.9x 5.3x 2.9x 13.9x Bakken 10.0x 5.5x 3.0x 16.8x Niobrara 10.7x 6.3x 2.8x…
  6. DUG Permian Conference – Seaport Global Securities LLC – slide 6
    5% 0% 10% 15% 20% 25% 30% 0% 100% 120% 20% 40% 60% 80% (5%) (10%) CPE REI PE GST REI COG RSPP FANG FANG CRZO COG PE GST CPE PXD RSPP CLR RICE XEC CLR DVN CXO CRZO PXD JONE SYRG NFX RRC WPX PDCE CXO…
  7. DUG Permian Conference – Seaport Global Securities LLC – slide 7
    Where Are We Today Core public Permian E&Ps reflect 27.2K/acre Equals 50% arbitrage opportunity Recent A&D transactions have averaged 19.7K/acre Current Enterprise Value (/Acre) Recent A&D Transactions (/Acre) 70,000 70,000…
  8. DUG Permian Conference – Seaport Global Securities LLC – slide 8
    Big Picture Permian Themes: Q1:16 Takeaways & M&A Implications 1) Delaware Basin 2) Efficiency Gains & Improving Recoveries 3) Stacked Pay & Downspacing 4) Exploration Page 8
  9. DUG Permian Conference – Seaport Global Securities LLC – slide 9
    Delaware Basin: Most Improved Basin in Q1:16 Cimarexs Culberson County Returns Q1 Data Points APA has costs down to 3.5MM/well, down 60% vs. FY14 OXY's 90-day rates doubled on its enhanced completion wells in the Northern…
  10. DUG Permian Conference – Seaport Global Securities LLC – slide 10
    M&A Transactions Since 2014: Acreage Multiples By Year By Sub-Basin 2016 Transactions YTD: Midland Basin: Median: 15.9K/acre Median: 27.0K/acre Average: 14.8K/acre Average: 27.2K/acre 2015 Transactions: Delaware Basin: Median:…
  11. DUG Permian Conference – Seaport Global Securities LLC – slide 11
    Efficiency Gains & Improving Recoveries: Pushing Breakeven Prices Lower RSPPs AFEs for 7,500 Lateral (MM) Q1 Data Points APC: Well costs fell 14% QoQ in the Delaware; D&C costs are now projected at 5.2MM/well with BTAX…
  12. DUG Permian Conference – Seaport Global Securities LLC – slide 12
    Acreage Price Case Study: Increased EURs Type Curve Assumptions Assumptions: Initial Clean-Up Commodity Mix % qi Discount 0% Initial Near-Term Long-Term 10,000 net surface acres Months to Peak 0 Year 2 4 1 rig running Exponential Phase…
  13. DUG Permian Conference – Seaport Global Securities LLC – slide 13
    Stacked Pay & Downspacing: No One-Trick Permian Ponies EOGs Delaware Basin Stacked Pay Q1 Data Points XEC: Wolfcamp A wells now pegged as better than Wolfcamp D in Culberson Co.; Avalon Shale could also be as good as Bone Spring in…
  14. DUG Permian Conference – Seaport Global Securities LLC – slide 14
    Acreage Price Case Study: Multiple Zones Inputs Net Acreage 10,000 Current Long-term: 2 yrs Assumptions: Zones 1.0 D&C (MM) 5.00 5.00 Effective Acreage 10,000 % Drilling 33% 33% 10,000 net surface acres Risked 100% % Completion 67% 67%…
  15. DUG Permian Conference – Seaport Global Securities LLC – slide 15
    Exploration: Southern Delaware, Northern Delaware, and CBP a Q1:16 Focus Recent Rig Activity Q1 Data Points APA: Doing significant science work despite low current prices. Recent Drilling Info data showed that APA had three rigs…
  16. DUG Permian Conference – Seaport Global Securities LLC – slide 16
    Who Are the Insider Buyers: Balance Sheet Strength Is Key Credit Facility Net Debt / EBITDA Those with Net Debt / FY17 EBITDA below 2.0x: Cash Availability Liquidity Com pany Ticker 2016E 2017E (MM) (MM) % Draw n (MM) CPE, XEC, CXO,…
  17. DUG Permian Conference – Seaport Global Securities LLC – slide 17
    Potential Strategic Combinations Rationale: XOM gains 60+ years worth of drilling + inventory, providing short-cycle stability. Rationale: Immediately accretive given valuation + disconnect. Gives FANG entry into Delaware Basin.…
  18. DUG Permian Conference – Seaport Global Securities LLC – slide 18
    Permian Basin: Private Operators Private Permitting Activity Private Permitting since July 2015 Large private operator presence Permits filed from 89 privates vs. 36 publics Delaware Basin coming into focus 57% of private Permian…
  19. DUG Permian Conference – Seaport Global Securities LLC – slide 19
    Conclusions/Predictions Permian is dominant and is continuing to get better (costs, EURs, inventory), which provides Upside exists to current A&D valuation metrics Arbitrage exists between public and A&D markets keeps demand high…
  20. DUG Permian Conference – Seaport Global Securities LLC – slide 20
    M&A Transactions Since 2014 (1 of 2) Date Transaction Production Undeveloped Implied Announced Buyer(s) Seller(s) Value (MM) (boepd) Acreage /Acre (1) 2/14/2014 Diamondback Henry; Various Others 288 2,155 4,683 43,156 4/8/2014 Athlon…
  21. DUG Permian Conference – Seaport Global Securities LLC – slide 21
    M&A Transactions Since 2014 (2 of 2) Date Transaction Production Undeveloped Implied Announced Buyer(s) Seller(s) Value (MM) (boepd) Acreage /Acre (1) 1/19/2015 Matador Heyco 137 530 18,200 6,352 5/6/2015 Diamondback Cobra; Sundown;…
  22. DUG Permian Conference – Seaport Global Securities LLC – slide 22
    Contact Us Mike Kelly, CFA Stephane Aka John Aschenbeck Senior Analyst Analyst Analyst mkellyseaportglobal.com sakaseaportglobal.com jaschenbeckseaportglobal.com (713) 658-6302 (713) 658-6329 (713) 658-6343 Matt Sorenson Patrick…

From the store

Browse maps, data & reports in the Shale Experts store