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Johnson Rice 2017 Energy Conference – Unit Corp.

Unit Corp. · Sep 26, 2017 · 36 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. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 1
    Unit Corporation Corporate Presentation September 26, 2017
  2. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 2
    Unit Corporation: A Diversified Energy Company 10 Tulsa based, incorporated in 1963 10 Casper Marcellus Pittsburgh Integrated approach to business allows Unit to capture margin from each business segment Anadarko Tulsa…
  3. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 3
    Company Highlights Highly economic Midstream segment opportunities for our E&P EBITDA poised for growth segment Fiscally conservative Contract drilling segment Capital spending in line growing with industry with cash flow…
  4. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 4
    Core Upstream Producing Areas Key focus areas include: Mid Continent Region Gulf Coast: Wilcox (Southeast Texas) Hoxbar/STACK MidContinent: Granite Wash Granite Wash (Texas Panhandle) Upper Gulf Coast Region Hoxbar (Western…
  5. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 5
    Units STACK and STACK Extension Positions STACK STACK Extension 10,000+ acres 100% HBP 80% in Over Pressured Window Upper, Middle and Lower Meramec also Woodford and Oil Osage targets Condensate Operators are testing 1520…
  6. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 6
    STACK Acreage Proven Across Multiple Targets ML 614N9W 1H (DVN) Angus Trust 1433XH (CLR) Privott 17_2016N9W 1H (CLR) 12 Wehmuller 1307 219MH (MRO) Bone 32126 1H (Jones) 11 13 14 IP30: 1,766 Boepd (48% Oil) 10 IP30: 4,642 Boepd (45% Oil)…
  7. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 7
    STACK Extension Pushing Boundary of STACK Ward 211H (Commanche) McConnell 191H (Comanche) Moss 301H (Corlena) Schoeppel 162012 (CHK) Medrill 2015 127H (SD) 10 12 13 14 IP30: 627 Boepd (75% Oil) IP30: 532 Boepd (46% Oil) 11 IP30: 491…
  8. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 8
    Wilcox (Southeast Texas) Wilcox Strategy for Future Growth POLK TYLER Over 100 stacked pay recompletion and workover opportunities in existing wells (e.g. Gilly Field) Drill exploratory prospects with large upside (e.g. Cherry…
  9. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 9
    Wilcox Activity Map for 2017 TYLER SEGNO NE POLK GILLY VILLAGE MILLS WING CHERRY CREEK HARDIN LIBERTY Drilled and completed 10 Scheduled for 2017
  10. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 10
    2016 Wilcox Recompletions & Workover Results Composite Gross Production from Recompletions and Workovers 20 Recompletions & 7 Workovers Total Cost: 10MM Start of Year End of Year 3,360 mcfd 40,000 mcfd 80 bopd 1,100 bopd 11
  11. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 11
    2017 (YTD) Wilcox Recompletions & Workover Results Composite Gross Production from Recompletions and Workovers 13 Recompletions & 10 Workovers Total Cost: 6.6MM Start of Year End of Q2 6,230 mcfd 14,520 mcfd 220 bopd 370…
  12. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 12
    Wilcox Horizontal Upper Dempsey Test Village Mills Field West Univ. 1H 5,800 Lateral 1.03 BCFG IP60: 8 MMCF/D, 180 BO/D 2.6 MMCF/D IP 2,000 Flowing Pressure 214,000 Frac 22 Stage, 5,300,000 Frac 1.45 BCFG 1.8 MMCF/D IP…
  13. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 13
    Wilcox Horizontal Targets Village Mills Field Potential for 30 horizontal wells OUTPOST SERIES Target in West University 2H 812 Laterals Possible (contingent upon reservoir and frac analysis) 10600 Sd 46 Laterals Possible…
  14. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 14
    Buffalo Wallow Field Economic Advantages Geology 11 Granite Wash lenses Sands present across acreage Land 9,000 net acres Operated and 90% HBP Average working interest 90% 220 270 potential XL locations Working to expand…
  15. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 15
    Granite Wash Extended Lateral (7,500) Potential Reserve Range 2,000 1,800 ROR assumes well cost of 6.3MM 1st C1 1,600 Cumulative Production (MMCFE) 11 BCFE 1,400 ROR: 104% 1,200 8 BCFE 1,000 ROR: 47% 800 2nd C1 4th…
  16. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 16
    Hoxbar (Marchand Sand) Hoxbar Marchand Core Area EUR 540 MBoe Well cost 5.2 MM 80% liquids (63% oil) 24,000 net acres (64% HBP) 50 60 locations H O X B A R 3 , 0 0 0 Working interest of 5060% ROR1 79% Running one rig…
  17. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 17
    Rig Fleet Presence in Key Regions 95 rig fleet 20 800 HP: 21% 10 71 1,0001,700 HP: 75% 4 2,000 HP: 4% 69% electric 10 54% 1,500 HP or greater 34 equipped with skidding or walking systems 27 additional can be skidded 35%…
  18. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 18
    SCR Rigs Continue to Make an Important Contribution 40 At industry trough 13 35 drilling rigs operating 30 23 Currently, 33 drilling rigs 25 operating 20 12 All BOSS rigs operating 15 9 7 10 23 SCR rigs operating 10 9…
  19. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 19
    Average Dayrates and Margins (1) 20,000 100% 15,000 75% Average Rig Utilization Margins and Dayrates 10,000 50% 5,000 25% 0 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 6 mos. '17 Margins Dayrates Average…
  20. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 20
    The BOSS Drilling Rig Optimized for Pad Drilling Multidirection walking system Faster Between Locations Quick assembly substructure 3234 truck loads More Hydraulic Horsepower (2) 2,200 horsepower mud pumps 1,500 gpm…
  21. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 21
    Midstream Core Operations Brook Field Pittsburgh Mills Snow Shoe Texas Panhandle Northern Oklahoma and Kansas 52,000 dedicated acres 2,064,000+ dedicated acres Pittsburgh 135 MMcf/d processing capacity 193 MMcf/d processing…
  22. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 22
    Midstream Segment Contract Mix 2010 Q2 2017 Contract Mix Based on Volume 28% 49% 51% 72% Fee Based Commodity Based Contract Mix Based on Margin 15% 35% 85% Fee Based 65% Commodity Based Unit vs. 3rd Party Margin…
  23. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 23
    Midstream Historical Volumes 200,000,000 180,000,000 160,000,000 Gathered & Processed 140,000,000 120,000,000 MMBtu 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 2009 2010 2011 2012 2013 2014…
  24. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 24
    Midstream Segment Commodity Price Sensitivity (1) 70,000,000 Segment EBITDA Before Intercompany Eliminations 2016 Adjustments 60,000,000 Utilized 2016 volumes 50,000,000 Assumed 40,000,000 55.00/Bbl oil price 30,000,000…
  25. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 25
    Debt Structure No NearTerm Maturities Senior Subordinated Notes Ratings S&P Moodys Fitch Corporate B+ B2 B+ 650 million, 6.625% Senior Subordinated Notes BB B3 BB 10year, NC5; maturity 2021 6/30/2017 Key Covenants Interest…
  26. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 26
    Segment Contribution Revenues ( millions) Adjusted EBITDA ( millions)(1) 1,573 800 1,600 787 1,352 1,400 667 1,200 600 1,000 854 410 800 400 602 600 252 346 200 400 145 200 0 0 2013 2014 2015 2016 6 mos. '17 2013 2014…
  27. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 27
    Operating Segment Capital Expenditures (In Millions) 1,500 1,000 500 0 2013 2014 2015 2016 2017 Forecast Oil and Natural Gas Contract Drilling Midstream 28
  28. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 28
    Investment Considerations E&P segment three core areas provide compelling economics Contract drilling segment resuming pattern of growth Midstream segment positioned to benefit from increased activity levels and liquids price…
  29. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 29
    APPENDIX 30
  30. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 30
    NonGAAP Financial Measures Corporate Adjusted EBITDA Six months ended Years ended June 30, December 31, ( In Millions) 2016 2017 2013 2014 2015 2016 Net Income (Loss) (113) 25 185 136 (1,037) (136) Income Taxes (59) 20 117 87…
  31. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 31
    NonGAAP Financial Measures Segments Adjusted EBITDA Six months ended Years ended June 30, December 31, ( In Millions) 2016 2017 2013 2014 2015 2016 Unit Petroleum Income (Loss) Before Income Taxes (1) (113) 64 239 199 (1,631)…
  32. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 32
    NonGAAP Financial Measures Reconciliation of Average Daily Operating Margin Before Elimination of Intercompany Rig Profit and Bad Debt Expense Six months ended Years ended (In thousands except for operating days June 30, December 31,…
  33. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 33
    NonGAAP Financial Measures Reconciliation of Average Daily Operating Margin Before Elimination of Intercompany Rig Profit and Bad Debt Expense Years ended December 31, (In thousands except for operating days and operating margins) 2008…
  34. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 34
    Midstream Reconciliation of EBITDA (Before Intercompany Eliminations) Segment EBITDA Before Intercompany Eliminations Years ended December 31, ( In Millions) 2009 2010 2011 2012 2013 2014 2015 2016 Total Midstream Income (Loss)…
  35. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 35
    Derivative Summary Crude 2017 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Collars Volume (Bbl) Weighted Avg Floor Weighted Avg Ceiling 3Way Collars Volume (Bbl) 337,500 341,250 345,000 345,000 180,000 182,000 184,000 184,000 Weighted Avg…
  36. Johnson Rice 2017 Energy Conference – Unit Corp. – slide 36
    Q3 2017 Economic Prices Strip Case* Natural BBL MB Crude Gas MB C2 MB C3 C3 MB NC4 MB iC4 MB C5+ CW C2 CW C3 CW NC4 CW iC4 CW C5+ 2017 49.816 3.168 0.277 0.878 27.168 1.013 1.008 1.155 0.191 0.851 1.026 1.044 1.123 2018 50.980…

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