Skip to main content 3Q 2017 Fiscal Update – National Fuel Gas Co. Investor Presentation | Shale Experts
Loading...
Pm

3Q 2017 Fiscal Update – National Fuel Gas Co.

National Fuel Gas Co. · Aug 3, 2017 · 54 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. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 1
    Investor Presentation Q3 Fiscal 2017 Update August 3, 2017 1
  2. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 2
    NFG: A Diversified, Integrated Natural Gas Company Developing our large, high quality acreage position in Marcellus & Upstream Utica shales with a focus on returns E&P 785,000 Net acres in Appalachia Expanding and modernizing…
  3. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 3
    Balanced Earnings and Cash Flows Adjusted EBITDA by Segment ( millions)(1) 1,500 Exploration & Production Segment Gathering Segment Pipeline & Storage Segment Utility Segment Energy Marketing & Other 1,000 953 852 843 789…
  4. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 4
    Disciplined, Flexible Capital Allocation Capital Expenditures by Segment ( millions)(1) (2) Exploration & Production Segment CapEx Reconciliation for JDA Proceeds Gathering Segment (millions) 1,250 E&P Total NFG Pipeline & Storage…
  5. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 5
    Near-term Growth Strategy National Fuel Will Continue to Grow Integrated Businesses While We Sort Through Northern Access Delay Grow Marcellus and Utica production at a 10%+ CAGR over next 3 years WDA Development (1-rig program)…
  6. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 6
    Strong Balance Sheet & Liquidity Debt/Adjusted EBITDA Capitalization 2.66 x 2.61 x 2.27 x 1.89 x 1.77 x Total Equity Total Debt 45% 55% 3.7 Billion Total Capitalization 2013 2014 2015 2016 TTM Fiscal Year End 06/30/17 as of…
  7. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 7
    Committed to the Dividend Annual Dividend Rate ( /share) NFGs Dividend Consistency 2.00 Consecutive 115 Years Payments 1.50 Consecutive 47 Years Increases 1.00 Current Dividend 1.66 per Share Rate 0.50 Current Dividend…
  8. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 8
    Upstream Overview Exploration & Production 9
  9. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 9
    Upstream Growing Production within Disciplined Capital Program E&P Net Capital Expenditures(1) ( millions) Senecas Near-term Operational Plan 600 557 Appalachia West Coast (California) Appalachia Natural Gas 2-rig development…
  10. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 10
    Upstream Proved Reserves Total Proved Reserves (Bcfe) 3,000 Natural Gas (Bcf) Fiscal 2016 Proved Reserves Reconciliation (Bcfe) Crude Oil (MMbbl) 2,500 2,344 Proved Reserves - FYE '15 2,344 FY '16 Production (161) (1)…
  11. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 11
    Upstream Significant Appalachian Acreage Position Western Development Area (WDA) Fee Acreage Lease Acreage Current gross production: 340 MMcf/d EDA - 70,000 Acres WDA - 715,000 Acres Large inventory of high quality Marcellus…
  12. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 12
    Upstream Western Development Area Significant multi-zone drilling inventory economic under 2.00 /Mcf WDA Marcellus Tier 1 Acreage 200,000 Acres Marcellus Shale : 1,000+ well locations Utica Shale: 125 to 500+ well locations (2)…
  13. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 13
    Upstream WDA Marcellus: Clermont/Rich Valley Development CRV Development Summary Gross daily production: 315 MMcf/d 1-rig / daylight only frac crew Developing 75 Marcellus wells with joint development partner (IOG) 75 wells…
  14. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 14
    Upstream WDA Utica: Early Results and Economic Impact 300 Utica Early Test Results: WDA Utica vs Drawdown management is critical 250 Marcellus Restricted drawdown improves well EURs Higher pressure significantly enhances well…
  15. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 15
    Upstream WDA Utica: Transition to Development Seneca and NFG Midstream can leverage existing upstream and midstream infrastructure to drive capital, operational, and marketing efficiencies NEXT STEPS: WDA Marcellus WDA Utica…
  16. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 16
    Upstream Eastern Development Area EDA Highlights EDA Acreage 70,000 Acres 1 DCNR Tract 007 (Tioga Co., Pa) 1 Utica and 1 Marcellus producing well 1 Utica 30-day IP = 15.8 MMcf/d Utica development expected to begin in fiscal…
  17. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 17
    Upstream EDA Marcellus: Lycoming County Development Marcellus Development in Lycoming County has Resumed in Anticipation of Atlantic Sunrise Prolific Marcellus acreage with peer leading well results 60 Marcellus wells producing w/…
  18. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 18
    Upstream EDA Utica: Tioga County Development Utica Development in Tioga County Tract 007 Expected to Begin in FY18 Inventory: 59 locations economic under 1.95 /Mcf SRC EDA Tract 007 Targeting to grow production by 100 to 150…
  19. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 19
    Upstream Marcellus: Drilling & Completions Efficiencies Operational Efficiencies and Investment in Water Infrastructure Have Resulted in Peer Leading Well Costs Marcellus Drilling Marcellus Completions Average Daily Footage…
  20. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 20
    Upstream Appalachia Drilling Program Economics 1,300 Locations Economic Below 2.00/MMBtu(1) (2) Internal Rate of Return % Realized (1) Locations Completed Price Anticipated Remaining Lateral Average 2.50 2.25 2.00 Required for…
  21. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 21
    Upstream Long-term Contracts Supporting Appalachian Production Seneca will continue to layer-in firm sales contracts with attractive realizations at regional pricing points to lock-in drilling economics and minimize spot exposure…
  22. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 22
    Upstream Firm Transportation Commitments Volume Delivery Demand Charges Production Source Gas Marketing Strategy (Dth/d) Market (/Dth) Firm Sales Contracts Currently In-Service Northeast Supply EDA -Tioga County Canada…
  23. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 23
    Upstream Firm Sales Provide Market for Appalachian Production Net Contracted Firm Sales Volumes (Dth per day) Contracted Index Price Differentials ( per Dth)(1) Fixed Price Dawn In-Basin NYMEX 449,000 395,200 94,200 383,200…
  24. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 24
    Upstream California Oil Stable Oil Production Minimal Capital Investment Steady Free Cash Flow FY16 Gross Production Daily 1 Location Formation Method Production (Boe/d) East 1 Temblor Primary 770 Coalinga 2 North Lost…
  25. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 25
    Upstream California Average Daily Net Production Less than 40 Million Annual Capital Spending Needed to Keep CA Production Flat California Annual Capital Expenditures (MM) California Average Net Daily Production (BOE/D) 9,699…
  26. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 26
    Upstream Future Development Focused on Midway Sunset North Midway Sunset Economics North MWSS MWSS Project IRRs at 50/Bbl(1) Sec. 17N Acreage 60% 30% 35% Pioneer NMWSS & Sec. 17N Pioneer SMWSS South Modest near-term…
  27. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 27
    Upstream Seneca Production Net Production (Bcfe) 250 Appalachia West Coast (California) 200 185 - 200 170-180 160.5 157.8 161.1 150 120.7 100 165 - 180 139.3 140.6 150 - 160 136.6 100.7 50 20.0 21.2 21.2 20.5 20 20 0…
  28. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 28
    Upstream Strong Hedge Book in FY 2018 Natural Gas Swap & Fixed Physical Sales Contracts (Millions MMBtu) (1) 125.0 NYMEX Dominion Dawn Fixed Price Physical Sales 100.0 94.1 75.0 66.6 62.3 44.1 50.0 35.2 31.2 25.0 - FY…
  29. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 29
    Upstream Fiscal 2017 Production and Price Certainty 200 5 Bcf 5 Bcfe 170 180 Bcfe 4.2 Bcf (2) 55% of Remaining spot 150 remaining oil 133.2 Bcfe 28 Bcf production production assumed to be hedged at sold at 60.21 /Bbl…
  30. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 30
    Upstream Fiscal 2018 Production and Price Certainty FINANCIAL HEDGE + FIRM SALE = PRICE CERTAINTY 250 136.5 Bcf Protected by Firm Sales Next Year 185 200 Bcfe 200 90 Bcf locked-in realizing net 2.61/Mcf (1) 20 Bcfe 46.5 Bcf…
  31. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 31
    Upstream Seneca Operating Costs Appalachia LOE & Gathering California LOE Seneca Resources Consolidated /Mcfe /Boe /Mcfe 1.52 1.45 0.74 17.40 16.86 1.43 0.73 0.71 0.17 14.83 0.15 0.15 0.14 0.11 0.11 (1) (1) 0.39 0.35 0.33…
  32. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 32
    Midstream Businesses 33
  33. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 33
    Midstream Midstream Businesses Midstream Businesses System Map Midstream Businesses Adjusted EBITDA (MM) Pipeline & Storage Segment Gathering Segment 278 282 Empire Pipeline, Inc. 250 257 FERC-Regulated NFG Supply Corp.…
  34. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 34
    Midstream Integrated Development WDA Gathering System Gathering System Build-Out Tailored to Accommodate Senecas WDA Development Clermont Gathering System Map Current System In-Service 70 miles of pipe / 31,220 HP of compression…
  35. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 35
    Midstream Integrated Development EDA Gathering Systems Gathering Segment Supporting Senecas EDA Production & Future Development Wellsboro Gathering System Total Investment (to date): 7 million FY 2018 Capital Expenditures: 15…
  36. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 36
    Midstream Infrastructure Expansions Bolster Supply Diversity Expanding Our Pipelines to Assure Supply Security for New York Markets Integration of Senecas WDA Production Into Broader Interstate System Northern Access 2015…
  37. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 37
    Midstream Northern Access Project Status National Fuel Remains Committed to Building the Northern Access Pipeline Project Project in-service not expected before 2019 due to regulatory delays February 3, 2017 NFG received FERC 7(c)…
  38. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 38
    Midstream Empire System Expansion Foundation Shipper Agreement Provides Major Commitment Needed for the Empire North Project Target In-Service: November 2019 System: Empire Pipeline Estimated Cost: 135 million Receipt Point:…
  39. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 39
    Midstream Continued Expansion of the NFG Supply System Future NFG Supply System Expansions Line D Expansion Project Target In-Service: November 2017 Contracted Capacity: 77,500 Dth/d from an interconnect with TGP 300 at Lamont,…
  40. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 40
    Midstream Pipeline & Storage Customer Mix Customer Transportation by Shipper Type(1) Affiliated Customer Mix (Contracted Capacity) 4.1 MMDth/d Affiliated Non-Affiliated Outside End User Pipeline 2% 6% 40% Marketer 54% 10%…
  41. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 41
    Downstream Overview Utility Energy Marketing 42
  42. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 42
    Downstream New York & Pennsylvania Service Territories New York Total Customers(1): 528,312 ROE: 8.7% (NY PSC Rate Case Order, April 2017) Rate Mechanisms: o Revenue Decoupling o Weather Normalization o Low Income Rates o…
  43. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 43
    Downstream New York Rate Case Outcome On April 20, 2017, the New York Public Service Commission issued a Rate Order relating to NFG Distributions rate case (No. 16-G-0257) filed in April 2016. Rate Order Summary: Revenue…
  44. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 44
    Downstream Utility: Shifting Trends in Customer Usage Usage Per Account (1) Residential (Mcf) Industrial (MMcf) 150 40 125 35 100 30 75 25 50 20 12-Months Ended June 30 45 (1) Weighted Average of New York and…
  45. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 45
    Downstream Utility: Strong Commitment to Safety Capital Expenditures ( millions)(1) 125.0 Capital Expenditures for Safety Total Capital Expenditures 98.0 90 - 100 90 - 100 100.0 94.4 88.8 72.0 75.0 61.8 54.4 48.1 49.8…
  46. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 46
    Downstream Accelerating Pipeline Replacement & Modernization Utility Mains by Material Miles of Utility Main Pipeline Replaced(1) Wrought 145 Bare Iron 138 Coated Cast Iron NY 113 118 120 9,700 miles Plastic Bare…
  47. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 47
    Downstream A Proven History of Controlling Costs O&M Expense ( millions) 250 All Other O&M Expenses O&M Pension Expense O&M Uncollectible Expense 200 196 200 193 189 9 9 178 10 7 6 28 23 21 20 33 150 100 163 160 166 152…
  48. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 48
    Appendix 49
  49. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 49
    Appendix Earnings Guidance Decline in FY18 Earnings Guidance Predominantly Due to Lower Commodity Price Realizations Fiscal 2017 EPS Guidance Fiscal 2018 EPS Guidance Key Guidance Drivers 3.25/sh to 3.35/sh 2.70/sh to 3.05/sh…
  50. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 50
    Appendix Marcellus Operated Well Results WDA Development Wells: Producing Well Average IP Rate Average Average Treatable Area Count (MMcfd) 30-Day (MMcf/d) Lateral Length Clermont/Rich Valley (CRV) & Hemlock 135(1) 6.7 5.1 7,131…
  51. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 51
    Appendix Hedge Positions Natural Gas Volumes in thousand MMBtu; Prices in /MMBtu Fiscal 2017 (last 3 mos.) Fiscal 2018 Fiscal 2019 Fiscal 2020 Fiscal 2021 Avg. Avg. Avg. Avg. Avg. Volume Price Volume Price Volume Price Volume…
  52. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 52
    Appendix Non-GAAP Reconciliations Adjusted EBITDA Reconciliation of Adjusted EBITDA to Consolidated Net Income ( Thousands) 12-Months FY 2013 FY 2014 FY 2015 FY 2016 Ended 06/30/17 Total Adjusted EBITDA Exploration & Production…
  53. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 53
    Appendix Non-GAAP Reconciliations Capital Expenditures Reconciliation of Segment Capital Expenditures to Consolidated Capital Expenditures ( Thousands) FY 2017 FY 2018 FY 2013 FY 2014 FY 2015 FY 2016 Forecast Forecast Capital…
  54. 3Q 2017 Fiscal Update – National Fuel Gas Co. – slide 54
    Appendix Non-GAAP Reconciliations E&P Operating Expenses Reconciliation of Exploration & Production Segment Operating Expenses by Division (000s unless noted otherwise) Twelve Months Ended Twelve Months Ended September 30, 2016…

From the store

Browse maps, data & reports in the Shale Experts store