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May 2017 Corporate Presentation – Sanchez Energy Corp

Sanchez Energy Corp · May 4, 2017 · 40 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. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 1
    Results Driven. Manufacturing Focused. Corporate Presentation May 2017 January 23, 2017 www.sanchezenergycorp.com
  2. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 2
    Sanchez Energy Overview Market Cap(1) 680 MM Eagle Ford Shale (1) Enterprise Value 3,000 MM Net Acreage: 360,000 (2) Avg. 1Q 2017 Production: 51,800 Boe/d Dominant Western Eagle Ford Acreage Position Over 4,000 net drilling…
  3. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 3
    Sanchez Energy: Transformation in 2016 2.3 Billion Comanche Acquisition Acquired 300 MMBoe of proved reserves and 67,000 Boe/d in the Eagle Ford Along with Blackstone, agreed to acquire Anadarkos Eagle Ford acreage Factory…
  4. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 4
    Leads to Creation of Shareholder Value 3 yr. Projected Production CAGR Results in the ability to deliver Over 20% both free cash flow and production growth EBITDA Projected to More Than Double by 2018 Improves the balance sheet…
  5. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 5
    Sanchez Energy Building Asset Base in 2016 YE 2015: 200,000 Net Eagle Ford Acres Through a series of strategic initiatives, Sanchez Energy is now one of the largest operators in the basin, focused on multiple-bench development in…
  6. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 6
    Sanchez Energy Transformation Snapshot Proved Reserves SN Production 350 343 90,000 80,000 300 2017 Focus on 80,000 Converting PUDs & PDNP 70,000 250 to PDP 60,000 52,524 53,504 193 (MMBoe) 200 50,000 Boe/d 150 135…
  7. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 7
    Large Inventory of High Rate of Return Locations Inventory of over 4,000 High Rate of Return Net Drilling Locations Maverick Net Drilling Locations 1,000 3-Stream EUR (MBoe) 350 Est. Capital Cost (MM) 3.0 IRR (%)* 60-80%…
  8. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 8
    Strong Net Asset Value Location Summary Net Producing + Net Engineered Net Contingent Total Net Undrilled Total Net Area DUC Wells Locations(1) Locations(2) Wells Locations Comanche 392 832 162 994 1,386 Catarina 333 846 626 1,472…
  9. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 9
    Operations and Asset Development A Process Driven Manufacturing Approach 10 2017 Sanchez Energy Corporation
  10. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 10
    Multi-Bench Development Total Eagle Ford Thickness Eagle Ford Well Density Western Eagle Ford Western Eagle Ford Multi-Bench Development Across Western Eagle Ford Lower, Middle and Upper Eagle Ford Shale with upside in…
  11. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 11
    Multi-Bench Development Potential TARGET BENCH DEVELOPMENT ZONE FUTURE GROSS DEVELOPMENT LOCATIONS Brittleness AUSTIN CHALK E LOWER AUSTIN 1,000-1,500 CHALK UPPER EAGLE 2,000-3,000 UPPER EAGLE FORD A FORD UPPER EAGLE…
  12. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 12
    Completion Enhancements Increasing Type Curves Impact of Completion Design on Catarina Well Results(1) 2016 Completion 1,000 Mboe 2015 Completion Cumulative Boe 700 Mboe Pre-2014 Completion 450 Mboe Producing…
  13. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 13
    South Central Development E33 Pad Continues to Outperform South Central Type Curve E-33 step out pad continues to outperform and is tracking 20% above the current South Central Type Curve Fourteen new wells had a per well 30-day…
  14. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 14
    Cost Structure Compared to Eagle Ford Peers Average Lateral Length 9,000 9.0 Eagle Ford Company Disclosed Drilling and Completions Cost 8,000 8.0 7,000 7.0 6,000 6.0 Average Lateral Length (Ft) 5,000 5.0 (MM)…
  15. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 15
    Focus on Integration and Scalability Many Aspects Of The Comanche Acquisition Are Strategically Similar To The Acquisition Of Catarina Acquisition Comparison Catarina Acquisition Comanche Acquisition Acquisition Value Buildup PDP…
  16. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 16
    Comanche Activity Update Focused on Integration Sanchezs Comanche asset team has been meeting since January Began vendor negotiations in January to get in front of service cost inflation DUC Focused Operations Expect to complete…
  17. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 17
    2017 Capital Guidance 2017 Capital Budget Eagle Ford Operated Capital Catarina Maverick Rigs Net Wells (MM) Comanche Comanche DUC Catarina 1.5 53 160 - 170 Palmetto Land/Infrastructure/G&G Maverick 1 35 100 - 110 23% Comanche…
  18. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 18
    Sanchez Energy Positioned for Significant Growth Comanche Provides Significant Production Growth While Operating Within Cash Flow in the Next 12-18 Months 1,400 120 1,200 100 1,000 Capital Spending (Million) Production…
  19. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 19
    Extensive Field Infrastructure Extensive Field Gathering and Water Infrastructure Throughout Comanche 3rd Party Gathering System Comanche Water Infrastructure Comanche Acreage Identified for further Infrastructure Buildout Gas…
  20. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 20
    SPP Midstream Relationship Western Eagle Ford Focus Results in Synergies Through SPPs Midstream Asset Base 21 2017 Sanchez Energy Corporation
  21. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 21
    Financial Highlights 22 2017 Sanchez Energy Corporation
  22. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 22
    Financial Strategy Maintain Adequate Liquidity Monetized non-core assets to build liquidity No near term debt maturities Achieve Upside Through Balanced Commodity Mix Continue Active Hedge Program to De-Risk Cash Flows…
  23. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 23
    Maturity Profile No Bonds Maturing Until 2021 Robust Covenant Headroom High yield has no financial maintenance covenants Maintenance covenants under existing SN revolver are: 1.0x Current Ratio 2.0x Net First Lien Debt/LTM EBITDA…
  24. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 24
    Achieve Upside Through Blended Commodity Mix NGL Discount to WTI Expected to Shrink Multiple ethane crackers expected to come online starting in 2017 Growing propane exports Natural Gas Strategically located near export lines to…
  25. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 25
    Focus on Remaining a Low Cost Leader SNs Low Cost Leadership Improves Margins and Supports the Companys Capital Program 50 Cash G&A LOE Taxes Interest & Dividends 45.06 45 4.78 41.46 40 4.72 9.37 Total Cash Operating Cost…
  26. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 26
    Sanchez Energy: Summary Highlights Dominate Western Closed 2.3 billion acquisition in the Western Eagle Ford Eagle Ford Acreage Position Leased 110,000 net acres in Maverick and Javelina areas Relentless Focus on Well costs have…
  27. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 27
    Appendix 28 2017 Sanchez Energy Corporation
  28. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 28
    2017 Production and Cost Guidance Guidance (1) FY 2017 FY 2018 Production Volumes: Oil (Bbls/d) 29,250 - 30,750 39,200 - 41,160 NGLs (Bbls/d) 23,010 - 24,190 28,800 - 30,240 Natural Gas (Mcf/d) 154,440 - 162,360 192,000 - 201,600…
  29. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 29
    Comanche Acquisition Adjacent to SNs Core Acreage 33.5 MBoe/d Net to SN 36% oil / 34% NGLs Over 900 MM in NPV-10 Value from PDP and PDNP (DUCs), net to SN 132 Drilled Uncompleted Wells (DUCs) de-risk near-term development and cash…
  30. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 30
    Strategic JV Facilitated Comanche Acquisition Repeatable Structure Matches Cash Flow with Appropriate Financing Blackstone Sanchez Energy Corporation Energy Partners Non-Recourse Unrestricted Subsidiary Non-Recourse RBL Gavilan…
  31. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 31
    Drilling Inventory Breakeven Analysis 2,657 Total Net Engineered Locations Average Estimated Breakeven Price 35/Bbl 600 48 Net Locations Breakeven Oil Price 500 40 WTI Breakeven Oil Price 10% IRR Net Engineered Drilling…
  32. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 32
    Detailed SN Hedge Position Crude Oil Hedges Natural Gas Hedges Type of Daily Volume Daily Volume Quarter Contract Bbls/d Floor Price Ceiling Price Quarter Type of Contract MMBtus/d Swap Price Swaps 9,000 50.99 Swaps 104,000 3.05…
  33. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 33
    Detailed UnSub Hedge Position Crude Oil Hedges Natural Gas Hedges Type of Daily Volume Daily Volume Quarter Contract Bbls/d Floor Price Ceiling Price Quarter Type of Contract MMBtus/d Swap Price Swaps 7,396 55.85 Swaps 43,000 3.26…
  34. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 34
    Capitalization Summary Revolving credit facility for SN (due 2019) 350 million borrowing base with an elected commitment of 300 million and an interest rate of LIBOR + 2.00% - 3.00% Financial Maintenance Covenants: Maximum Net First…
  35. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 35
    2016 Catarina Appraisal Results Piloncillo E33 (Pilot + 4 MEF laterals) Highest IP rate pad brought online to date (1,500-1,800 Boe/d per well) Exceeds south central type curve Piloncillo A25 (Pilot + 3 UEF/MEF laterals)…
  36. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 36
    Leader in Existing Multi-Bench Development Multi-Bench Development of Existing Sanchez Assets Catarina Drilled Wells in Middle & Upper Eagle Ford 60 Number of Wells Drilled 50 40 30 20 10 0 2014 2015 2016 2017E…
  37. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 37
    Western Catarina Development Stacked development focused in the Lower and Middle Eagle Ford Significant amount of additional high rate of return drilling inventory remaining Successful infill and step-out drilling program to date…
  38. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 38
    Comanche: Area 3 Overview 2017 Activity In Area 3 Comanche Area 3 IP (Bbl/d) 520 Oil Net Capital 80MM Initial Decline (%) 78.0% Oil EUR (MBbl) 258 Drilling of 61 Gross Development Wells IP (Mcf/d) 2,487 Completions of 40…
  39. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 39
    Comanche: Area 5 Overview 2017 Activity In Area 5 Comanche Area 5 IP (Bbl/d) 740 Net Capital 55MM Oil Initial Decline (%) 77.0% Oil EUR (MBbl) 413 Drilling of 51 Gross Development Wells Completions of 20 Gross Development…
  40. May 2017 Corporate Presentation – Sanchez Energy Corp – slide 40
    Maverick Regional 2017 Maverick development activity 35 net wells at 750 ft in-zone spacing 2016 appraisal focused on double and triple stacking Eagle Ford target intervals 500+ well inventory for single zone LEF; nearly doubles…

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