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2Q 2017 Earnings Update – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Aug 2, 2017 · 38 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. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 1
    Q2 2017 Earnings AUGUST 2,2017
  2. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 2
    FINANCIAL AND OPERATING HIGHLIGHTS Q2 2017 adjusted income: 38 MM, or 0.21 per diluted share1 Q2 2017 production: 259 MBOEPD (57% oil) Top end of Pioneers guidance range of 254 MBOEPD to 259 MBOEPD Increase of 10 MBOEPD, or 4%, from…
  3. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 3
    FINANCIAL AND OPERATING HIGHLIGHTS (CONT.) Placed 61 horizontal wells on production in the Spraberry/Wolfcamp during Q2 9 wells were Version 3.0+ completions with encouraging early results 4 wells were completed in the Jo Mill…
  4. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 4
    2017 UPDATE Operating 18 horizontal rigs in the Spraberry/Wolfcamp 14 rigs in northern area and 4 rigs in southern Wolfcamp JV area (60% WI) Utilizing Version 3.0 completions o Testing a minimum of 15 wells with larger completions…
  5. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 5
    2017 UPDATE (CONT.) Higher gas-oil ratios (GORs) than forecasted on PDP wells are resulting in increased gas and NGL production compared to current type curves Increased gas and NGL production expected to result in higher EURs,…
  6. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 6
    DE FE R R ING 3 0 SP R A BE R RY/ WOLFC AMP C OMP LE T IONS IN 2 0 1 7 TO MA INTA IN E FFIC IE NT OP E R AT IONS 2017 plan assumed 260 horizontal wells would be POPd during the year, heavily weighted to 2H (150 wells in 2H) Due to…
  7. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 7
    H I G H E R G O R s O N P D P W E L L S I N C R E A S I N G S P R A B E R RY / W O L F C A M P G A S V O L U M E S W I T H N O D E G R A D AT I O N TO O I L P R O D U C T I O N Observing higher GORs than forecasted on horizontal PDP…
  8. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 8
    G R A D U A L LY I N C R E A S I N G G O R s O V E R T H E L I F E O F A W E L L H AV E B E E N O B S E RV E D I N T H E S P R A B E R RY / W O L F C A M P F O R D E C A D E S Normal for reservoirs driven by solution gas to experience…
  9. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 9
    2017 CAPITAL PROGRAM 1 AND CASH FLOW 2017 capital program reduced to 2.7 B Drilling and Completion Capital: 2.4 B 2017 Cash Flow Sensitivity to Forward Commodity Prices ( MM) 2.3 B Spraberry/Wolfcamp2 (95% of total) 5.00 o 1.8 B…
  10. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 10
    PRODUCTION GROWTH FORECAST Total Net Production (MBOEPD) 269 - 271 269 - 276 Expect production to be 274 - 279 closer to the low end of 2017 plan range 259 249 234 204 59% Oil 57% Oil 2015 2016 Q1 Q2 Q3 Q4 52% Oil…
  11. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 11
    E A R LY R E SU LT S FR OM V E R SIO N 3 .0 + C O M P LE T IO N S E NC O U R A G ING North University Area: LSS Updated Hutt Area: Wolfcamp B Updated End July End July 300 Version 3.0+: 3 wells in Q2 300 Version 3.0+: 3 wells in…
  12. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 12
    JO MILL PERFORMANCE ENCOURAGING Jo Mill wells since Q4 2014 Updated End July 200 Cumulative Production (MBOE)1 Jo Mill POP Locations 175 Remaining 2017 POPs 150 Q2 2017 POP: Pembrook 905H 125 9,500 avg. lateral 5 POPs…
  13. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 13
    2017 SPRABERRY/WOLFCAMP DRILLING PROGRAM Horizontal drilling program continuing to Pioneers Spraberry/Wolfcamp Acreage Position and 2017 Drilling Areas deliver strong returns Version 3.0 completions are the standard design…
  14. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 14
    SPRABERRY/WOLFCAMP PRODUCTION FORECAST Spraberry/Wolfcamp Net Production (MBOEPD)1 Q2 production: 213 MBOEPD 222 226 (+12 MBOEPD, or 6%, vs. Q1) Expect production to be closer to the low end of 61 wells placed on production in…
  15. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 15
    LIMITED 2017 EAGLE FORD SHALE DRILLING PROGRAM UNDERWAY Completing 20 horizontal wells in the Eagle Ford Shale Includes 9 DUCs that are testing higher intensity completions and 11 new drills that are testing longer laterals with…
  16. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 16
    EXPANDING OIL PIPELINE COMMITMENTS TO MEET EXPECTED SPRABERRY/WOLFCAMP VOLUME GROWTH Pioneer is currently delivering Cushing 60 MBOPD of Spraberry/Wolfcamp oil to the Gulf Coast under firm pipeline contracts Longer-term target is…
  17. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 17
    Q2 2017 EARNINGS SUMMARY Millions Per Diluted (After Tax) Share Net income attributable to common stockholders 233 1.36 Noncash mark-to-market (MTM) derivative gains (111 MM before tax) (71) (0.42) Adjusted income excluding noncash…
  18. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 18
    PRICE REALIZATIONS Realized Prices 49.05 46.13 45.00 41.43 41.44 19.33 16.76 16.91 14.21 12.46 2.59 2.79 2.62 2.43 1.67 Q216 Q316 Q416 Q1'17 Q2'17 Q216 Q316 Q416 Q1'17 Q2'17 Q216 Q316 Q416 Q1'17 Q2'17 Oil (/BBL)…
  19. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 19
    PRODUCTION COSTS (PER BOE) Q2 2017 compared to Q1 2017: 8.42 8.38 8.36 8.20 Workovers 7.85 0.59 LOE declined due to increasing 0.25 0.46 0.76 Production & 0.37 production attributable to lower cost Ad Valorem 1.70 1.78 2.11…
  20. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 20
    LIQUIDITY POSITION Net debt at the end of Q2 2017 (reflects cash on hand, including liquid 0.3 B investments, of 2.4 B) Unsecured credit facility availability 1.5 B Net debt-to-book capitalization at the end of Q2 3% Maturities…
  21. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 21
    Q3 2017 GUIDANCE Guidance Daily Production (MBOEPD) 274 279 Production Costs (/BOE) 7.75 9.75 Exploration & Abandonment ( MM) 20 30 Drilling and Acreage 5 - 10 Personnel and Seismic 15 - 20 DD&A (/BOE) 14.00 16.00 G&A ( MM) 80…
  22. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 22
    SUPPLEMENTAL INFORMATION Supplemental Information Slides Slide GOR/Oil Performance History 24 - 25 Production History 26 Cash Margins by Asset 27 2017 Drilling Capital 28 Oil and Gas Revenue 29 Derivative Positions 30 - 32 General…
  23. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 23
    GOR AND OIL CONTENT HISTORY ON PIONEERS EARLY HORIZONTAL WELLS Avg. Avg. June Avg. Avg. June Cumulative 2017 GOR Cumulative 2017 Oil % GOR (MCF/BBL) Oil % (MCF/BBL) 7 Initial Horizontal Wells in Upton & Reagan Counties 3,841…
  24. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 24
    GORs AND OIL PRODUCTION PERFORMANCE ON PIONEERS EARLY HORIZONTAL WELLS 7 Initial Horizontal Wells in 7 Initial Horizontal Wells in Upton & Reagan Counties Midland & Martin Counties 10,000 10,000 Oil Production 1,000 1,000 Oil…
  25. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 25
    PRODUCTION BY COMMODITY BY AREA Q2 '16 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Spraberry/Wolfcamp Oil (BOPD) 117,388 120,663 130,236 134,522 137,307 NGL (BOEPD) 27,829 34,631 31,637 36,529 42,176 Gas (MCFPD) 131,847 144,249 154,836 178,586…
  26. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 26
    CASH MARGINS BY ASSET Q2 2017 Cash Margin by Asset ( per BOE) Permian Permian Other Total Horizontals Verticals Eagle Ford Assets Company Realized price (ex-hedges) 34.92 33.39 26.66 20.86 32.56 Production costs 1 (2.23)…
  27. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 27
    2017 DRILLING AND COMPLETIONS CAPITAL 1 Millions 2,400 644 524 Q1 '17 Q2 '17 FY '17 1) Excludes acquisitions, asset retirement obligations, capitalized interest and geological and geophysical G&A expenditures 28
  28. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 28
    OIL AND GAS REVENUE Millions 809 753 768 643 613 Q2 '16 Q3 '16 Q4 '16 Q1 '17 Q2 '17 29
  29. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 29
    OPEN COMMODITY DERIVATIVE POSITIONS AS OF 7/28/17 Oil Q3 2017 Q4 2017 2018 Collars (BPD) 6,000 6,000 - NYMEX Short Call Price (/BBL) 70.40 70.40 - NYMEX Put Price (/BBL) 50.00 50.00 - Three Way Collars (BPD)1 147,000 155,000…
  30. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 30
    OPEN COMMODITY DERIVATIVE POSITIONS AS OF 7/28/17 Ethane Q3 2017 Q4 2017 2018 Collars (BPD)1 3,000 3,000 - Mont Belvieu Call Price (/BBL) 11.83 11.83 - Mont Belvieu Put Price (/BBL) 8.68 8.68 - Frac Spread (BPD) 2 2,500 2,500…
  31. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 31
    OPEN COMMODITY DERIVATIVE POSITIONS AS OF 7/28/17 Gas Q3 2017 Q4 2017 2018 Three Way Collars (MMBTUPD)1,2 290,000 300,000 62,329 NYMEX Call Price (/MMBTU) 3.57 3.60 3.56 NYMEX Put Price (/MMBTU) 2.95 2.96 2.91 NYMEX Short Put…
  32. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 32
    GENERAL AND ADMINISTRATIVE COSTS Millions 89 82 84 81 80 15 16 15 14 Noncash 17 Q2 Q3 Q4 Q1 Q2 2016 2016 2016 2017 2017 33
  33. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 33
    INTEREST COSTS Millions 56 5 50 2 46 46 1 1 35 1 Noncash Q2 Q3 Q4 Q1 Q2 2016 2016 2016 2017 2017 34
  34. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 34
    EXPLORATION & ABANDONMENTS ( Millions) Drilling, Acreage & Other Abandonments 8 Geological & Geophysical Seismic 2 Personnel & Other 16 2nd Quarter Total 26 35
  35. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 35
    INCOME TAXES ATTRIBUTABLE TO CONTINUING OPERATIONS Quarter Ended June 30, 2017 ( Millions) Current tax provision Deferred tax provision 121 Income tax provision 121 36
  36. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 36
    SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES EBITDAX and discretionary cash flow (DCF) are disclosed by Pioneer, and reconciled to the generally accepted accounting principle (GAAP) measures of net income and net cash provided by operating…
  37. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 37
    SUPPLEMENTAL EARNINGS PER SHARE INFORMATION The Company uses the two-class method of calculating basic and diluted earnings per share. Under the two-class method of calculating earnings per share, GAAP provides that share and unit-based…
  38. 2Q 2017 Earnings Update – Pioneer Natural Resources Co. – slide 38
    SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES Adjusted income excluding noncash MTM derivative gains and adjusted income excluding noncash MTM derivative gains and unusual items, as presented in the Financial and Operating Highlights slide…

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