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Q3 2016 Company Presentation – Consol Energy Inc.

Consol Energy Inc. · Nov 1, 2016 · 37 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. Q3 2016 Company Presentation – Consol Energy Inc. – slide 1
    Company Presentation Q3 2016
  2. Q3 2016 Company Presentation – Consol Energy Inc. – slide 2
    CONSOL Energy: Company Overview Journey Towards Becoming a Top Tier Appalachian E&P Company Complete December 5, 2013 Transaction with Murray Energy Corp. in which we sold half of coal assets and related assets April 19, 2014 CONSOL…
  3. Q3 2016 Company Presentation – Consol Energy Inc. – slide 3
    Marcellus Joint Venture (JV) Exchange Agreement 1. Exchange agreement of jointly owned Oil & Gas properties, Post-Exchange Acreage Map consisting of: Developed properties with associated current production of 1,070 MMcfe/d, net to the…
  4. Q3 2016 Company Presentation – Consol Energy Inc. – slide 4
    Post-Exchange Agreement: Pro Forma Analysis Impact on Marcellus Shale Operations Before After CONSOL Energy JV Exchange Agreement JV Exchange Agreement 2016E Production(1) (Bcfe) 380-385 390-395 2016E Average per Unit Operating…
  5. Q3 2016 Company Presentation – Consol Energy Inc. – slide 5
    Strategic Overview Agreement to Separate Marcellus Shale Joint Venture Full autonomy to develop, operate, or divest assets - Flexibility to operate these assets as we choose - Facilitates stacked pay development opportunities -…
  6. Q3 2016 Company Presentation – Consol Energy Inc. – slide 6
    Key Takeaways of the Exchange Agreement Joint Venture Separation Drives Long-Term Value Growth The exchange agreement provides CONSOL Energy the ability to drive NAV per share higher through: Greater flexibility in our capital…
  7. Q3 2016 Company Presentation – Consol Energy Inc. – slide 7
    E&P Operations 8
  8. Q3 2016 Company Presentation – Consol Energy Inc. – slide 8
    Marcellus Shale Footprint Before and After the Joint Venture Exchange Agreement with Noble Energy Marcellus Shale Marcellus Shale Before Exchange Agreement After Exchange Agreement WI (%) 50 WI (%) 100 Net Net Undeveloped 335,000…
  9. Q3 2016 Company Presentation – Consol Energy Inc. – slide 9
    E&P Operations E&P Division: Q3 2016 Operations Summary Marcellus Shale Quarterly Summary Utica Shale Quarterly Summary Avg. TIL Turned Turned Avg. TIL Sub- Horizontal Lateral Sub- Horizontal Drilled Completed In Line Counties…
  10. Q3 2016 Company Presentation – Consol Energy Inc. – slide 10
    E&P Operations: Pro Forma DUC Inventory 2016 Activity Overview and 2017 Drilled and Uncompleted Opportunity Set E&P Activity Summary 2016 Plan Expected New Drilled Drilled Implied 2016 Wells Drilled in Uncompleted Completed 2016…
  11. Q3 2016 Company Presentation – Consol Energy Inc. – slide 11
    E&P Operations: Capital Expenditures Efficiencies Driving Reduced E&P Capital Expenditures Without Sacrificing Growth Deferring activity, increasing capital efficiency 2016 E&P Capital Budget: improvements and identification of…
  12. Q3 2016 Company Presentation – Consol Energy Inc. – slide 12
    E&P Operations: Benchmarking vs Peers Full-cycle Breakeven Operating Metrics Declined from 3.51 to 1.92 per Mcfe, a 45% Projected Decline 4.00 3.51 3.50 3.27 3.00 1.17 1.11 2.56 2.50 0.82 1.92 2.00 Cash OpEx 0.84 0.59 (plus…
  13. Q3 2016 Company Presentation – Consol Energy Inc. – slide 13
    E&P Operations: Drilling Improvements Days vs. Utica Shale: Depth Days vs. Depth (Wells (Wells in orderof in order of Horizontal Horizontal TD Date) TD Date) 0.0 SWITZ6B SWITZ6D 5,000.0 SWITZ6F SWITZ6H Expect Additional…
  14. Q3 2016 Company Presentation – Consol Energy Inc. – slide 14
    Utica Shale: Drilling Cost Improvements Switz Drilling Cost (/lateral ft) (Wells in order of Tophole TD) 2,000 Drilling Cost (/lateral ft) 1,800 1,810 1,740 1,600 1,400 1,380 1,340 1,200 1,150 1,060 1,040 1,040 1,000…
  15. Q3 2016 Company Presentation – Consol Energy Inc. – slide 15
    Gas Marketing 16
  16. Q3 2016 Company Presentation – Consol Energy Inc. – slide 16
    Gas Marketing Q3 2016 Gas Realization and Marketing Highlights CONSOL basin exports are projected to increase approximately 73,000 Dth/day for FY 2016 over FY 2015 as TETCOs U2GC Q3 2016 Natural Gas Price Reconciliation and TEAM…
  17. Q3 2016 Company Presentation – Consol Energy Inc. – slide 17
    Gas Marketing Firm Transportation Expected Firm Capacity by Pipeline After FT Reallocation In addition to the upstream 1,800 deal, CNX and NBL have 1,600 agreed to work with the NEXUS 1,400 pipelines to reallocate firm 1000s…
  18. Q3 2016 Company Presentation – Consol Energy Inc. – slide 18
    Gas Marketing Natural Gas Sales: Expected Market Mix MIDWEST TETCO M3 DOMINION SOUTH TCO POOL TETCO M2 EAST TENNESEE Gas Sales 2016E 2017E Columbia (TCO) 17% 17% TETCO (M2) 29% 28% TETCO (M3) 16% 15% Dominion (DTI)…
  19. Q3 2016 Company Presentation – Consol Energy Inc. – slide 19
    Gas Marketing Natural Gas Processing and NGLs 600 CNX Expected Contracted Processing Capacity CNX and NBL have also agreed to work with processing 500 counterparties to realign processing capacity with the upstream assets 400…
  20. Q3 2016 Company Presentation – Consol Energy Inc. – slide 20
    Gas Marketing: Liquids Realizations Natural Gas Liquids, Oil, and Condensate Q3 2016 Avg. NGL Barrel Composition Q3 2016 liquids sold: 13.6 Bcfe, up 29% from Q2 2016 3Q16 Est NGL Sales Comp Total weighted average price of all liquids…
  21. Q3 2016 Company Presentation – Consol Energy Inc. – slide 21
    Gas Marketing Gas Hedges CNX Gas Volumes Hedged 2016-2020 E&P Hedge Program: 300 Program and actively Physical Sales With Fixed Basis Exposed to NYMEX Gas Volumes Hedged (Bcf) monitored hedges 250 NYMEX Only Hedges Exposed to…
  22. Q3 2016 Company Presentation – Consol Energy Inc. – slide 22
    Financial 23
  23. Q3 2016 Company Presentation – Consol Energy Inc. – slide 23
    Financial: Q3 2016 Review Third Quarter 2016 Results Net earnings attributable to continuing operations(1) in the 2016 third quarter of 62.6 million, or 0.26 per diluted share Adjusted net loss attributable to continuing operations(1)…
  24. Q3 2016 Company Presentation – Consol Energy Inc. – slide 24
    Financial: Q3 2016 Review (Contd) Net (Decrease)/Increase in Cash Generated positive free cash flow - Organic free cash flow from continuing operations in Q3 2016 of 103 million; first nine months 2016 total organic FCF of 188 million…
  25. Q3 2016 Company Presentation – Consol Energy Inc. – slide 25
    Financial: Q3 2016 Review (Contd) E&P Division: Results Summary Y/Y Q-to-Q Seq. Q-to-Q E&P Division 3Q2016 3Q2015 Change 3Q2016 2Q2016 Change (1) Average Sales Price ( / Mcfe) 2.54 2.35 0.19 2.54 2.50 0.04 (2) Average Costs ( / Mcfe)…
  26. Q3 2016 Company Presentation – Consol Energy Inc. – slide 26
    Financial: Liquidity Strong Liquidity Position of 1.4 Billion Amount/ Amount Letters Amount September 30, 2016 ( in million) Capacity Drawn of Credit Available Cash and Cash Equivalents(1) 74 - - 74 (2) Revolving Credit Facility 2,000…
  27. Q3 2016 Company Presentation – Consol Energy Inc. – slide 27
    Financial: Liquidity (Contd) Debt and Liquidity Profile CNX CNXC: CNX CNX Consolidated 100% Attributable Equity Value of Ownership in Unit Market Owned LP (5) Capitalization and Liquidity 9/30/2016 9/30/2016 9/30/2016 Affiliated…
  28. Q3 2016 Company Presentation – Consol Energy Inc. – slide 28
    Financial: Legacy Liabilities Significant Legacy Liability Reductions Over Past 3 Years 4,500 4,345 400 Annual Cash Servicing Costs ( in Millions) 4,000 350 370 Legacy Liabilities ( in millions) 3,500 Projected 100MM Annual…
  29. Q3 2016 Company Presentation – Consol Energy Inc. – slide 29
    Financial: CNX Coal Resources LP (CNXC:NYSE) Organizational Structure and CNX Ownership CONSOL Energy Inc. CNXC owns a 25% undivided interest(1) in, and (CONSOL Energy) operational control over, CONSOL Energys Pennsylvania NYSE: CNX…
  30. Q3 2016 Company Presentation – Consol Energy Inc. – slide 30
    Financial: CONEs Growing Cash Contribution CNNX: CNX Ownership and Cash Contribution CONSOL owns 32.1% of CONE Midstream Partners LPs CONE Midstream's and Gathering's Pro Rata Net Income Contribution to CNX (NYSE: CNNX) LP units and…
  31. Q3 2016 Company Presentation – Consol Energy Inc. – slide 31
    Guidance E&P Segment Guidance 2016E Production Volumes: Natural Gas (Bcf) 346 - 349 NGLs (MBbls) 6,500 - 6,750 Oil (MBbls) 62 - 68 Condensate (MBbls) 800 - 850 Total Production (Bcfe) 390 - 395 Natural Gas Basis Differential to…
  32. Q3 2016 Company Presentation – Consol Energy Inc. – slide 32
    Guidance Coal Segment Guidance 2016E Estimated Total PA Mining Operations Sales Volumes (in millions of tons) 23.6 - 24.4 Sales Volumes Attributed to Discontinued Operations (in millions of tons) 2.1 % PA Mining Operations Tonnage…
  33. Q3 2016 Company Presentation – Consol Energy Inc. – slide 33
    Key Takeaways Plans and Goals Aligned to Drive Increased Valuation Milestones: Improving E&P performance from high-grading activities, improving completion techniques, reducing cycle times, and service cost deflation Adding two…
  34. Q3 2016 Company Presentation – Consol Energy Inc. – slide 34
    Appendix 35
  35. Q3 2016 Company Presentation – Consol Energy Inc. – slide 35
    Appendix Non-GAAP Reconciliation: EBITDA and Adj. EBITDA Three Months Ended September 30, 2016 2016 2016 2016 2015 PA Mining E&P Total Total ( in thousands) Division Operations Other1 Company Company Division Net Income/(Loss)…
  36. Q3 2016 Company Presentation – Consol Energy Inc. – slide 36
    Appendix Non-GAAP Reconciliation: Trailing Twelve Months EBITDA and Adj. EBITDA Three Months Three Months Three Months Three Months Twelve Months Ended Ended Ended Ended Ended December 31, March 31, June 30, September 30, September…
  37. Q3 2016 Company Presentation – Consol Energy Inc. – slide 37
    Appendix Free Cash Flow Reconciliation Three Months Ended Nine Months Ended September 30, September 30, ( in thousands) 2016 2016 Net Cash provided by Continuing Operations 166,064 372,211 Capital Expenditures (64,132)…

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