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October 2016 Corporate Presentation – Range Resources Corp

Range Resources Corp · Oct 3, 2016 · 69 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. October 2016 Corporate Presentation – Range Resources Corp – slide 1
    Company Presentation October 3, 2016 1
  2. October 2016 Corporate Presentation – Range Resources Corp – slide 2
    Ranges Keys for Success Low-cost Strong Low-cost takeaway hedge and structure Continual capacity liquidity with ability capital improves profile with to continue efficiency realizations no near-term to drive improvement and…
  3. October 2016 Corporate Presentation – Range Resources Corp – slide 3
    Gas In Place (GIP) Analysis Shows Greatest Potential in SW PA When GIP analysis from the Marcellus, Upper Devonian and Point Pleasant are combined, the largest stacked pay resource is located in SW PA where Range has concentrated…
  4. October 2016 Corporate Presentation – Range Resources Corp – slide 4
    SW/NE Pennsylvania Stacked Pays Wet Acreage Dry Acreage Total Net Acreage (1) Upper Devonian 335,000 180,000 515,000 Marcellus 335,000 280,000 615,000 Utica/Point Pleasant - 400,000 400,000 670,000 860,000 1,530,000…
  5. October 2016 Corporate Presentation – Range Resources Corp – slide 5
    Marcellus Wells An Industry Leader SW Super-Rich SW Wet SW Dry NE Dry 16.0 Bcfe 20.6 Bcfe EUR 17.6 Bcf 20.5 Bcf 1,450 Mbbls & 7.3 Bcf 1,756 Mbbls & 10.1 Bcf EUR/1,000 ft. lateral 2.4 Bcfe 3.0 Bcfe 2.5 Bcf 2.5 Bcf EUR/stage 485…
  6. October 2016 Corporate Presentation – Range Resources Corp – slide 6
    Existing Pads Enhance Future Development for Range Expansive inventory of over 200 pads 124 pads: 5 or fewer wells 59 pads: 6-9 wells New pads in progress Pads accommodate 20 wells Flexibility to drill Marcellus, Utica / Point…
  7. October 2016 Corporate Presentation – Range Resources Corp – slide 7
    Sustained Growth + Improving Capital Efficiency 1,500 30 Capex per Incremental mcfe Production 1,250 25 Production (Mmcfepd) 1,000 20 750 15 500 10 250 5 0 - 2011 2012 2013 2014 2015 2016E* Production…
  8. October 2016 Corporate Presentation – Range Resources Corp – slide 8
    Driving Down Unit Costs 4.50 4.00 3.50 /mcfe 3.00 2.50 2.00 1.50 1.00 0.50 0.00 - 2011 2012 2013 2014 2015 2016E DD&A 1.69 1.62 1.44 1.30 1.14 0.96 LOE(1) 0.60 0.41 0.36 0.35 0.26 0.20 Prod. Taxes 0.14 0.15 0.13 0.10 0.07…
  9. October 2016 Corporate Presentation – Range Resources Corp – slide 9
    Near-Term Price Enhancements RRC Marcellus NG Differential to NYMEX Natural Gas Differential - 0.00 (0.10) Ability to utilize full year of Spectras Uniontown (0.42) (0.20) to Gas City project, including 200 Mmcf/day of Midpoint…
  10. October 2016 Corporate Presentation – Range Resources Corp – slide 10
    Appalachia Gas Transportation Arrangements Regional Direction Projected Avg. 2016 Projected Avg. 2017 Transport Cost Transport Cost Mmbtu/day Mmbtu/day per Mmbtu per Mmbtu Firm Transportation Appalachia/Local 390,000 0.20 325,000…
  11. October 2016 Corporate Presentation – Range Resources Corp – slide 11
    Strong Unhedged Recycle Ratio Recycle Ratio: (Margin divided by F&D) Pre-Hedge Price (Assuming 2017 NYMEX 3.10/50) 2.70 All-In Cash Unit Costs (2016 Expected) 1.84 Adjusted Margin 0.86 Expected Future Development Cost for PUD…
  12. October 2016 Corporate Presentation – Range Resources Corp – slide 12
    Strong, Simple Balance Sheet YE YE Q1 Q2 Q3 Q4 Q1 Q2 2013 2014 2015 2015 2015 2015 2016 2016 ( in millions) Bank borrowings(1) 500 723 912 364 987 95 31 3 Sr. Notes(1) 750 750 750 750 750 Sr. Sub. Notes(1) 2,641 2,350 2,350 2,350…
  13. October 2016 Corporate Presentation – Range Resources Corp – slide 13
    Liquidity and Financial Capacity (June 30th Pro Forma) BEFORE EXCHANGE OFFER AND MERGER Lowest debt since 2012 3,000 Borrowing Base - 3 Billion 4B credit facility unanimously reaffirmed ( Millions ) 2,500 by bank group o 3B…
  14. October 2016 Corporate Presentation – Range Resources Corp – slide 14
    Ranges Keys for Success Assets, Team, Agreements & Strategy Low cost structure with Improving capital Better realizations from ability to continue driving efficiency additional takeaway costs lower Longer laterals; 2016 plan capacity…
  15. October 2016 Corporate Presentation – Range Resources Corp – slide 15
    Merger with Memorial Resource Development Announcement Date: May 16, 2016 Special Meeting Date: September 15, 2016 Closing Date: September 16, 2016 16
  16. October 2016 Corporate Presentation – Range Resources Corp – slide 16
    Highlights of Merger Core acreage positions in the two highest return, lowest cost natural gas plays Immediately cash flow accretive and credit enhancing Complementary assets positioned near expanding natural gas and NGL demand…
  17. October 2016 Corporate Presentation – Range Resources Corp – slide 17
    Combining Two High Quality Assets Terryville Acreage in Marcellus Acreage Northern Louisiana in Pennsylvania Low risk and high repeatability Low risk and high repeatability Near-term focus primarily on Near-term focus on Marcellus…
  18. October 2016 Corporate Presentation – Range Resources Corp – slide 18
    Immediately Accretive & Credit Enhancing Pro Forma Annual Consensus Metrics* Existing RRC % Change RRC 2016E Production 520 Bcfe 670 Bcfe +29% 2016E Production per day 1,420 Mmcfe 1,830 Mmcfe +29% 2016E Cash Flow 375 Million…
  19. October 2016 Corporate Presentation – Range Resources Corp – slide 19
    Marketing and Operational Efficiencies Marketing MRDs position gives Range a presence in the Gulf Coast in advance of additional Marcellus transportation availability out of Appalachia MRDs production receives near NYMEX pricing…
  20. October 2016 Corporate Presentation – Range Resources Corp – slide 20
    220,000 Acres of Lower Cotton Valley Potential (1) The position is anchored to the north by Terryville Field, to the south by Vernon Field, to the east by Choudrant Field and to the west by Driscoll Field Multiple vertical Lower…
  21. October 2016 Corporate Presentation – Range Resources Corp – slide 21
    2017 Growth Trajectory 2,500 2 Bcfepd 2,000 RRC Post Merger Mmcfepd 1,500 RRC (b) 1,000 500 0 2016E 2017E Current estimates and strip pricing indicate that Range (post-merger) can grow 10+% organically in…
  22. October 2016 Corporate Presentation – Range Resources Corp – slide 22
    Why Invest in Range Ability to allocate capital between the two highest return, lowest cost natural gas plays Unhedged recycle ratio of 2x near strip prices allows for efficient development of asset base 2017 growth of 30+%…
  23. October 2016 Corporate Presentation – Range Resources Corp – slide 23
    Appendix 24
  24. October 2016 Corporate Presentation – Range Resources Corp – slide 24
    Range: Low-Cost, Large Scale Range - Southwest Rich 5.50 EQT - Southwest Rich EQT - WV Rich 140 tcfe in the Southwest Southwestern - Rich Gas Core 5.00 Marcellus alone CONSOL - Southwest Rich Noble - Southwest Rich 4.50 Rice -…
  25. October 2016 Corporate Presentation – Range Resources Corp – slide 25
    Appalachian Peers Well Cost Comparison Average Well Cost* Average Lateral Length Cost (000s) (ft.) (per 1,000 ft.) Range 5,630 6,876 819 K Peer A 6,300 7,000 900 Peer B 8,100 9,000 900 Peer C 5,700 7,000 814 Peer D 7,350 7,500…
  26. October 2016 Corporate Presentation – Range Resources Corp – slide 26
    Appalachia Producers 2015 F & D Costs 2.50 2.25 N N N N e e e e 2.00 g g g g a a a a t t t t 1.75 2015 F & D per Mcfe i i i i v v v v 1.50 e e e e 1.25 A A A A d d d d 1.00 d d d d i i i i 0.75 t t t t i i i i…
  27. October 2016 Corporate Presentation – Range Resources Corp – slide 27
    Cost & Efficiency Improvements SW Pennsylvania Average Lateral Length Well Cost / Lateral Length 8,000 ' 2,500 7,000 ' 2,000 6,000 ' 5,000 ' 1,500 4,000 ' 3,000 ' 1,000 2,000 ' 500 1,000 ' - - 2012 2013 2014 2015 2016 E…
  28. October 2016 Corporate Presentation – Range Resources Corp – slide 28
    Cost & Efficiency Improvements Northern Marcellus Average Lateral Length Well Cost/Lateral Length 9,000 ' 2,500 8,000 ' 7,000' 2,000 6,000' 1,500 5,000' 4,000' 1,000 3,000' 2,000' 500 1,000' 0 0 2011 2012 2013 2014 2015…
  29. October 2016 Corporate Presentation – Range Resources Corp – slide 29
    Mariner East: Opening New Lanes First Shipments of Ethane & Propane Faster Propane Loading Combined with VLGC Ships Only producer with current capacity on Mariner East Historic first shipments of ethane from U.S. to Europe…
  30. October 2016 Corporate Presentation – Range Resources Corp – slide 30
    Track Record of Impressive Reserve Replacement at Low Cost 3-Year 5-Year 2011 2012 2013 2014 2015 Average Average Reserve Replacement All sources excluding PUD removals(1) 849% 680% 745% 793% 436% 638% 669% All sources (2)…
  31. October 2016 Corporate Presentation – Range Resources Corp – slide 31
    SW PA Super-Rich Area Marcellus Projected 2016 Well Economics Southwestern PA (High Btu case) NYMEX 110,000 Net Acres ROR EUR / 1,000 ft. 2.40 Bcfe Gas Price EUR 16.0 Bcfe Strip - 26% (226 Mbbls condensate, 1,224 Mbbls NGLs & 7.3…
  32. October 2016 Corporate Presentation – Range Resources Corp – slide 32
    Southwest PA - Super-Rich Area 2016 Turn in Line Forecast 3,000 Improvements Between Years EUR Well Costs Lateral (Bcfe) ( MM) Lengths (ft.) 2,500 2015 Type Curve - TIL 12.9 5.9 5,367 Normalized Mcfe/Day per 1,000 ft. 2016…
  33. October 2016 Corporate Presentation – Range Resources Corp – slide 33
    Southwest PA Super-Rich Marcellus Horizontal Length (TIL) Average Number of Stages 7,000 35 6,500 6,000 30 5,500 25 Stages Feet 5,000 4,500 20 4,000 3,500 15 3,000 10 2,500 2,000 5 2014 2015 2016 2014 2015 2016…
  34. October 2016 Corporate Presentation – Range Resources Corp – slide 34
    SW PA Wet Area Marcellus Projected 2016 Well Economics Southwestern PA (Wet Gas case) NYMEX 225,000 Net Acres ROR Gas Price EUR / 1,000 ft. 2.95 Bcfe EUR 20.6 Bcfe Strip - 25% (56 Mbbls condensate, 1,700 Mbbls NGLs & 10.1 Bcf gas)…
  35. October 2016 Corporate Presentation – Range Resources Corp – slide 35
    Southwest PA - Wet Area 2016 Turn in Line Forecast 3,000 Improvements Between Years EUR Well Costs Lateral (Bcfe) ( MM) Lengths (ft.) 2,500 2015 Type Curve - TIL 17.6 5.9 5,955 Normalized Mcfe/Day per 1,000 ft. 2016 Type Curve -…
  36. October 2016 Corporate Presentation – Range Resources Corp – slide 36
    Southwest PA Wet Marcellus Horizontal Length (TIL) Average Number of Stages 8,000 40 7,000 35 30 6,000 Stages Feet 25 5,000 20 4,000 15 3,000 10 2,000 5 2014 2015 2016 2014 2015 2016 EUR per 1,000 ft. EUR by…
  37. October 2016 Corporate Presentation – Range Resources Corp – slide 37
    SW PA Dry Area Marcellus Projected 2016 Well Economics Southwestern PA (Dry Gas case) 180,000 Net Acres NYMEX ROR EUR / 1,000 ft. 2.52 Bcf Gas Price EUR 17.6 Bcf Strip - 59% Drill and Complete Capital 5.2 MM 3.00 - 54% (743 K per…
  38. October 2016 Corporate Presentation – Range Resources Corp – slide 38
    SW PA Dry Area 2016 Turn in Line Forecast 3,500 Improvements Between Years EUR Well Costs Lateral (Bcf) ( MM) Lengths (ft.) 3,000 2015 Type Curve - TIL 17.1 6.0 6,798 Normalized Mcf/Day per 1,000 ft. 2,500 2016 Type Curve - TIL…
  39. October 2016 Corporate Presentation – Range Resources Corp – slide 39
    Southwest PA Dry Marcellus Horizontal Length (TIL) Average Number of Stages 8,000 40 7,000 35 30 6,000 Stages Feet 25 5,000 20 4,000 15 3,000 10 2,000 5 2014 2015 2016 2014 2015 2016 EUR per 1,000 ft. EUR by…
  40. October 2016 Corporate Presentation – Range Resources Corp – slide 40
    Normalized Production Results of Marcellus Tighter Spacing Projects Projects conducted in the Wet and Super Rich areas of the Marcellus 3,000 Tighter spaced wells turned to sales in 2009 and 2010 Average lateral length of these…
  41. October 2016 Corporate Presentation – Range Resources Corp – slide 41
    Targeting/Downspacing Test Results Encouraging Average Normalized Time Zero Decline Curves 3,500 3,000 Optimized targeting shows a 53% increase in cumulative production Average Mcfe/day per 1000 ft. after 600 days 2,500…
  42. October 2016 Corporate Presentation – Range Resources Corp – slide 42
    Returning to Existing Pads SW Wet 100,000 Drilled wells - 2015 10,000 Additional 5 wells Wellhead Gas (MCFD) Future Locations 1,000 100 10 Drilled wells - 2010 1 Oct-12 May-13 Nov-13 Jun-14 Dec-14 Jul-15 Jan-16…
  43. October 2016 Corporate Presentation – Range Resources Corp – slide 43
    Returning to Existing Pads SW Dry 100,000 Drilled wells - 2015 10,000 Wellhead Gas (MCFD) 1,000 Additional 3 wells Future Locations 100 10 Drilled wells - 2014 1 Mar-14 Jul-14 Dec-14 May-15 Oct-15 Mar-16 Aug-16…
  44. October 2016 Corporate Presentation – Range Resources Corp – slide 44
    Gas In Place (GIP) Marcellus Shale GIP is a function of pressure, temperature, thermal maturity, porosity, hydrocarbon saturation and net thickness Two core areas have been developed in the Marcellus Condensate and NGLs are…
  45. October 2016 Corporate Presentation – Range Resources Corp – slide 45
    Gas In Place (GIP) Point Pleasant Bold, outlined portion represents the area of the highest pressure gradients in the Point Pleasant Note: Townships where Range holds 2,000+ acres (as of January 2016) and estimated as prospective,…
  46. October 2016 Corporate Presentation – Range Resources Corp – slide 46
    Gas In Place (GIP) Upper Devonian Shale The greatest GIP in the Upper Devonian is found in SW PA A significant portion of the GIP in the Upper Devonian is located in the wet gas window Note: Townships where Range holds 2,000+…
  47. October 2016 Corporate Presentation – Range Resources Corp – slide 47
    Utica Wells Wellhead Pressure vs. Cumulative Production Early Time Production Data (Including Flowback/Test Data) 30 Mmcfd 10,000 25 Mmcfd 13,200 ft. TVD* 20 Mmcfd 8,000 13,400 ft. TVD* Wellhead Pressure (psi) 18 Mmcfd…
  48. October 2016 Corporate Presentation – Range Resources Corp – slide 48
    Utica/Point Pleasant Update Continued improvement in well performance for the 1st, 2nd and 3rd wells due to higher sand concentration and improved targeting 3rd well appears to be one of the best dry gas Utica wells in the…
  49. October 2016 Corporate Presentation – Range Resources Corp – slide 49
    Macro Section 50
  50. October 2016 Corporate Presentation – Range Resources Corp – slide 50
    Significant Natural Gas Demand Growth Projected Beginning in 2016 LONG TERM US NATURAL GAS DEMAND ROADMAP (BCF/D) Cumulative 2016 2017 2018 2019 2020 2016-2020 LNG Exports Sabine Pass 1.2 1.2 0.7 3.1 Freeport 0.5 1.0 1.5 Cove…
  51. October 2016 Corporate Presentation – Range Resources Corp – slide 51
    U.S. LNG Exports Expected to be 8 Bcf/day by 2020 per TPH Research report dated 10/08/2015 52
  52. October 2016 Corporate Presentation – Range Resources Corp – slide 52
    U.S. Natural Gas Exports to Mexico 4.00 3.50 3.00 2.50 Bcf/d 2.00 1.50 1.00 0.50 0.00 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Mexican exports have been…
  53. October 2016 Corporate Presentation – Range Resources Corp – slide 53
    U.S. Domestic Oil Production Appears to Have Peaked 7 major regions account for 95% of domestic oil production growth 6,000 Production appears to have peaked in 2nd Qtr. 2015 Significant reduction in capital spending in the 7 regions…
  54. October 2016 Corporate Presentation – Range Resources Corp – slide 54
    Year over Year % Growth -5.0% 10.0% 15.0% 20.0% -10.0% 0.0% 5.0% Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Source: Jefferies as of August 2016 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14…
  55. October 2016 Corporate Presentation – Range Resources Corp – slide 55
    Non-Appalachian Gas Basins Growth by Area 4.0% 2.0% 0.0% Year over Year % Growth -2.0% -4.0% -6.0% -8.0% Source: Bentek, EIA as of August 2016 56
  56. October 2016 Corporate Presentation – Range Resources Corp – slide 56
    Appalachian Pipeline Flow Data by Region (Mcf/d) 10,000,000 Production plateauing NE PA production limited by current rig 9,000,000 count in basin to maintain flat production DUC inventory declining 8,000,000 7,000,000…
  57. October 2016 Corporate Presentation – Range Resources Corp – slide 57
    Total U.S. Natural Gas Production Growth by Area 12.0% 8.0% Year over Year % Growth 4.0% 0.0% -4.0% December 2015 Marked the First Y/Y Supply Decrease Since February 2010 Source: Bentek, EIA as of August…
  58. October 2016 Corporate Presentation – Range Resources Corp – slide 58
    Appalachian Rig Counts Declining Utica / Point Pleasant Rig Count 60 50 Utica/Point Pleasant rig 40 count down 71% from the 30 peak in 2014 20 10 0 Marcellus Rig Count 150 120 Marcellus rig count down 90 80% from the…
  59. October 2016 Corporate Presentation – Range Resources Corp – slide 59
    Marcellus NGL Pricing Weighted Avg. Realized Marcellus NGL Prices Composite Barrel (1) 2015 2016 1Q 2Q 3Q 4Q 1Q 2Q NYMEX WTI 8% 48.62 57.88 46.61 42.22 33.56 45.31 7% (per bbl) 3% Mont Belvieu Weighted Priced 18.05 18.32 17.16…
  60. October 2016 Corporate Presentation – Range Resources Corp – slide 60
    Appalachian Production, Consumption & Takeaway - 2015-2018 50 LNG exports starting in early 2016 40 Appears to have sufficient takeaway capacity by 2017 30 Bcf/d 20 10 0 Jul-13 Nov-13 Jul-14 Nov-14…
  61. October 2016 Corporate Presentation – Range Resources Corp – slide 61
    Announced Appalachian Basin Takeaway Projects 1 of 2 Capacity Approved or Northeast PA Operator Main Line Market Start-up* Bcf/d Fully Committed with FERC 2015 Niagara Expansion Kinder Morgan TGP Canada Q4'15 0.2 Y Y Northern Access…
  62. October 2016 Corporate Presentation – Range Resources Corp – slide 62
    Announced Appalachian Basin Takeaway Projects 2 of 2 Capacity Approved or Southwest Operator Main Line Market Start-up* Bcf/d Fully Committed with FERC Midwest/Canada/ 2017 Rover Ph1 ETP Gulf Coast Q2'17 1.9 Y Y Rayne/Leach Xpress…
  63. October 2016 Corporate Presentation – Range Resources Corp – slide 63
    What Does the Futures Strip Price Indicate for Regional Basis Dawn 2015 +0.30 2020 -0.05 Algonquin 2015 +2.24 MichCon Leidy 2020 +1.20 Chicago CG 2015 +0.19 2015 -1.57 2015 +0.15 2020 -0.03 2020 -0.72 Transco Z6 (NY) 2020…
  64. October 2016 Corporate Presentation – Range Resources Corp – slide 64
    Appendix Financial Detail 65
  65. October 2016 Corporate Presentation – Range Resources Corp – slide 65
    Early, Continuous Action Taken to Prepare for Low Prices Called high cost 8% notes, reducing annual interest expense by 24 million or 0.06 mcfe June Redemption funded by an equal sized equity offering aimed at accelerating balance sheet…
  66. October 2016 Corporate Presentation – Range Resources Corp – slide 66
    Range Bonds Continue to Trade Well 14.0% 12.0% 10.0% Yield To Worst 8.0% 6.0% 4.0% 2.0% 0.0% 2/3/2016 3/2/2016 3/9/2016 4/6/2016 5/4/2016 6/1/2016 6/8/2016 7/6/2016 8/3/2016…
  67. October 2016 Corporate Presentation – Range Resources Corp – slide 67
    Gas and Oil Hedging Status Average Floor Volumes Hedged Period Price (Mmbtu/day) (/Mmbtu) 3Q 2016 Swaps 793,261 3.21 Gas Hedging 4Q 2016 Swaps 800,000 3.23 2017 Swaps 330,000 2.94 2018 Swaps 70,000 2.92 3Q 2016 Swaps…
  68. October 2016 Corporate Presentation – Range Resources Corp – slide 68
    Natural Gas Liquids Hedging Status Volumes Hedged Hedged Price(1) Period (bbls/day) (/gal) 2H 2016 Swaps 500 0.22 Ethane (C2) 2017 Swaps 3,000 0.27 2016 Swaps 5,500 0.60 Propane (C3) 2017 Swaps 3,960 0.53 Normal Butane…
  69. October 2016 Corporate Presentation – Range Resources Corp – slide 69
    Contact Information Range Resources Corporation 100 Throckmorton, Suite 1200 Fort Worth, Texas 76102 Laith Sando, Vice President Investor Relations (817) 869-4267 lsandorangeresources.com David Amend, Investor Relations Manager…

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