Helmerich & Payne, Inc. Barclays 2016 CEO Energy-Power Conference September 7-8, 2016
About Helmerich & Payne (H&P) Very strong balance sheet Most capable land drilling fleet Market share leader in the U.S. Robust term contract backlog Operational strategy focused on continued innovation, safety, performance…
H&Ps Strong Balance Sheet (As of June 30, 2016) Total-Debt-to-Total-Capitalization Ratio1 1. Total Capitalization is defined as Total Debt plus Shareholders' Equity. Source: Company Filings.
Current Dividend Yields Source: Thomson Reuters. Yields calculated as of market close on September 2, 2016.
H&Ps Global Rig Fleet * Estimates include existing rigs and announced new build commitments.
H&P U.S. Land Fleet Family of Solutions Rig Power Type FlexRig Type Pad* AC Drive FlexRigs Drawworks Horsepower ** * Optimal for multiple-well pad drilling applications. ** Approximately 123 FlexRig3s and 6 FlexRig4s of…
U.S. Land Market Share Leader As of August 2016 (510 Active Rigs in U.S. Land) Note: The above estimates corresponding to market share are derived from Rig Data. Additionally, the drawworks capacity of each land rig included in…
H&P Global Fleet Under Term Contract * The above term contract coverage excludes long-term contracts for which the Company received early contract termination notifications as of 9/7/16. Given notifications as of 9/7/16, the Company…
H&P vs. Industry U.S. Land Customer Base Note: The above estimates corresponding to the active rig fleet in the U.S. are derived from multiple sources including Rig Data. The category Large Operators includes majors and large…
U.S. Land Drilling Market Conditions Over 1,400 rigs have been idled in the U.S. and tens-of-thousands of industry participants have been laid off. The impact has been pervasive. Nevertheless, as oil and gas prices recover, the…
Drilling Activity in the U.S.
U.S. Land Horizontal and Directional Activity (As of August 2016) Note: The above estimates corresponding to horizontal and directional rig activity by power type are derived from multiple sources including Rig Data and corporate…
Land Drilling Market Share Changes (From May 2016 Through August 2017) A larger proportion of small and private operators have put rigs back to work since the May 2016 trough. As a consequence: Lower horsepower, non-AC Drive rigs…
The Replacement Cycle: Customer Adoption U.S. Land Market (as of August 2016) Top 10 E&P Operators Next 75 E&P Operators Remaining E&P Operators (120 Active Rigs by Power Type) (235 Active Rigs by Power Type) (155 Active Rigs by Power…
Replacement Cycle Expected to Continue As of August 2016 (510 Active Rigs in U.S. Land By Power Type) As of October 2008 (Peak) As of October 2014 (Peak) (1,925 Active Rigs in U.S. Land By Power Type) (1,930 Active Rigs in U.S.…
H&Ps Lead in U.S. Land 1,500 hp AC Drive Rigs * The above estimates corresponding to U.S. lower 48 AC Drive fleets are derived from Rig Data and corporate filings. ** Estimated number of all other available AC Drive rigs not…
H&Ps U.S. Land Activity and Pricing Comments H&Ps U.S. Land segment has approximately 92 contracted rigs generating revenue, including 88 rigs generating revenue days as of September 7, 2016 (13% of the 88 rigs remained idle and…
H&P Very Well Positioned to Gain Share Note: The above estimates are derived from multiple sources including Rig Data and corporate filings.
H&Ps U.S. Land Fleet Activity (1) (2) (1) Includes rigs on standby dayrates. (2) Includes completed new builds pending delivery and not generating revenue days.
Leading U.S. Unconventional Driller (94 H&P Contracted Land Rigs as of 9/7/16*) * Includes 2 announced new FlexRigs with customer commitments scheduled for delivery in calendar 2016.
H&P U.S. Land Fleet (Contracted Rigs as of 9/7/16) Rig Power Type FlexRig Type Pad* AC Drive FlexRigs Drawworks Horsepower ** * Optimal for multiple-well pad drilling applications. ** Most of the Other FlexRigs can be…
Technology & Quality Service Make a Difference (1) H&Ps Margin Premium (2) (1) Does not include the impact of early contract termination revenue. (2) Represents weighted-average rig margin per day for PTEN, NBR, PDS, and…
Performance is Not Only About Better Rigs Our competitive advantage is also about: People Support Structure Safety Processes Experience Organizational Network Training Maintenance Culture Supply Chain
Ongoing U.S. Land Market Trends Unconventional plays continue to shape the landscape. Well designs are increasingly complex, including longer laterals and more challenging drilling requirements. Customers continue to focus on…
Increasing Focus on More Difficult Drilling
H&Ps Long Term Strategy Innovation Technology Safety, operational excellence and reliability Customer satisfaction Financial strength
Additional References
Fourth Fiscal Quarter H&P Outlook (As of July 28, 2016) Drilling Operations Outlook for 4Q of Fiscal 2016 Compared to 3Q of Fiscal 2016 U.S. Land Segment Revenue days expected to increase by roughly 3% to 7% Average rig revenue per…
Estimated H&P Activity as of September 7, 2016 Rigs Rigs Working/ % Available Contracted Contracted U.S. Land 348 92 26% (1) (2) AC Drive FlexRigs 346 92 27% SCR Fleet 2 0 0% Offshore 9 7 78% International Land 38 16 42% Total 395…
H&Ps Lead in U.S. Land AC Drive Rigs * The above estimates corresponding to U.S. lower 48 AC Drive fleets are derived from Rig Data and corporate filings. ** Estimated number of all other available AC Drive rigs not including those…
U.S. Activity by Well and Rig Type 510 Active U.S. Land Rigs (August 2016) Vertical All Rigs Horiz & Dir SCR & Mech Rigs Horiz & Dir AC Drive Rigs Note: The above estimates corresponding to rig activity and rig type are…
H&P U.S. Land Fleet (Idle Rigs as of 9/7/16) Rig Power Type FlexRig Type Pad* AC Drive FlexRigs Drawworks Horsepower ** * Optimal for multiple-well pad drilling applications. ** Most of the Other FlexRigs can be upgraded…
H&Ps International Land Operations Rig Fleet Status (as of September 7, 2016) Long-term Contracted Idle Total Contracts (1) (2) Argentina 11 8 19 10 Bahrain 1 2 3 1 Colombia 2 6 8 1 Ecuador 6 6 U.A.E. 2 2 2 (3) Total 16 22 38…
H&P Global Fleet Under Term Contract Number of Rigs Already Under Long-Term Contracts* (Estimated Quarterly Average, Including Announced New Builds - as of 9/7/16) Segment Q4 Q1 Q2 Q3 Q4 Q1 Q2 FY16 FY17 FY17 FY17 FY17 FY18 FY18…
H&Ps FlexRig Advantage The FlexRig Difference: Key Advantages Increased drilling productivity and reliability Variable frequency AC technology providing precise control and increased capability Computerized electronic driller more…
The Value Proposition: The Power of Efficiency Theoretical 20% Efficiency 40% Efficiency Base Case Improvement Improvement 1. Drilling days average 13.5 10.8 8.1 Other days average 5.0 4.0 3.0 Moving days average (several multi-well…
Ten-Year Relative Shareholder Return Source: Thomson Reuters as of September 2, 2016.
Land Drilling Market Valuations Source: Thomson Reuters as of September 2, 2016.
Oil vs. Natural Gas Directed Rig Count
Oil and Natural Gas Prices Oil Prices Natural Gas Prices Source: Energy Information Administration and Thomson Reuters.
Loading...
