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Credit Suisse Annual Energy Summit – Chesapeake Energy Corp

Chesapeake Energy Corp · Feb 14, 2018 · 33 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. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 1
    CREDIT SUISSE 23RD ANNUAL ENERGY SUMMIT Vail, Colorado February 13, 2018 Nick DellOsso Executive Vice President and Chief Financial Officer
  2. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 2
    OUR STRATEGY AND GOALS Our strategy remains unchanged resilient to commodity price volatility Financial discipline STRATEGIC GOALS Profitable and efficient growth from captured resources 1 Debt reduction Exploration of 2 3…
  3. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 3
    2017 ACCOMPLISHMENTS 500 million 1.3 billion Reduced costs by 18%(1) Reduced term secured debt by 32% Improved cost structure by 0.58/boe Continued reduction 1.3 billion in legal complexity Of net proceeds collected from asset…
  4. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 4
    UPDATE ON RECENT PROGRESS Cash proceeds from divestitures 500 million in asset sales signed in late-2017 and 2018; expected to close in 1H 2018 Represents an EBITDA multiple of 7.1x 73 million in net proceeds from sale of FTSI…
  5. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 5
    WHATS THE IMPACT Sold 23,000 boe/d (25% oil) while maintaining flat 2018 adjusted production YOY Cost structure reduced by 0.14/boe(1) Interest expense may be reduced by up to 50 million Overhead reduction of 70 million through…
  6. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 6
    DEBT MATURITY PROFILE 2018 OUTLOOK (1) 9.2 billion 7.10% 533 million Senior Notes & Term Loan WACD Revolving Credit Facility 3,000 2,500 Revolving Credit Facility Secured 2,047 2,000 Unsecured 1,868 Convertibles 1,500…
  7. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 7
    Driving value across our portfolio Portfolio depth Growing capital efficiency Operational scale Advancing technology EH&S excellence Credit Suisse 23rd Annual Energy Summit 8
  8. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 8
    (1) PREMIER, DIVERSIFIED ASSET BASE APPALACHIA NORTH 1 rig ROCKIES 1.60 2.20/mcf Breakeven 3 rigs Acreage 577,000 (86% Held) 25 35/bbl Breakeven Acreage 369,000 (55% Held) APPALACHIA SOUTH 2 rigs 1.35 1.80/mcf Breakeven…
  9. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 9
    POWDER RIVER BASIN WY GROWING TO A CORE ASSET 15 20 40% oil, 58% liquids Stacked pay opportunities 275,000 net acres in PRB (72% held) 13+ prospective horizons Equivalent Net Volume (mboe/d) 15 10 2.6 bboe of resource…
  10. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 10
    POWDER RIVER BASIN TURNER WY BREAKEVEN: 25/BBL(1) Cumulative boe vs. Producing Months Industry Turner Offsets CHK Turner Producers 400,000 Cumulative boe 300,000 200,000 100,000 CHK TURNER PRODUCERS TURNER GAS…
  11. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 11
    POWDER RIVER BASIN NIOBRARA WY INCREASED PERFORMANCE THROUGH ENHANCED COMPLETIONS Cumulative boe/ft vs. Time First completion test CHK Niobrara CHK 2017 DUC Increased proppant concentrations Spacing to 1,320' from 660', 9,500'…
  12. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 12
    POWDER RIVER BASIN WY PLENTY OF RUNNING ROOM Parkman 205 mmboe resource base 425+ undrilled locations 1,980' spacing Sussex 67 mmboe resource base 72 undrilled locations 1,980' spacing Niobrara 538 mmboe resource base 650+…
  13. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 13
    SOUTH TEXAS TX CONTINUES TO DELIVER 60% oil, 78% liquids Large remaining inventory 100 120 3,100 undrilled locations after updated 100 development plan Equivalent Net Volume (mboe/d) 75 Stacked pay potential 80…
  14. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 14
    SOUTH TEXAS TX DRIVING FOR VALUE 16 N McMullen Fit-for-purpose completions and targeting Cumulative Oil/ft (bbl/ft) 14 12 +58% are improving well results 10 8 Right-sized spacing 6 4 2 Producing Days Longer laterals…
  15. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 15
    SOUTH TEXAS MULTI-ZONE POTENTIAL TX TESTING OF UPPER EAGLE FORD AND AUSTIN CHALK Blakeway 3 D DIM 2H Upper Eagle Ford 2,000 1,800 SERIES2 PRE-DRILL EXPECTATIONS Daily Production (boe/d) 1,600 BLAKEWAY 3 D DIM 2H 1,400…
  16. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 16
    MARCELLUS SHALE THE PREMIER DOMESTIC GAS BASIN PA Continue to improve 30 200 Technology expanding resource recovery, 25 driving greater value Equivalent Net Volume (mboe/d) 20 FCF generator, capital efficiency TIL…
  17. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 17
    LOWER MARCELLUS ENHANCED COMPLETIONS DRIVING MORE VALUE PA Enhanced vs. Modern Completions 7,000 Cumulative Production (MMCF) Industry Well 37 mmcf/d 6,000 5,000 4,000 3,000 2,000 1,000 0 0 50 100 150 200 250…
  18. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 18
    UPPER MARCELLUS STACKED POTENTIAL PA Maris Wells vs. Expectations 35,000 30,000 Gas Flowrate (MCFD) 25,000 20,000 15,000 10,000 5,000 0 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85…
  19. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 19
    (1) DIVERSE PORTFOLIO PROVIDES OPTIONALITY Remaining 4Q17 Undrilled Locations Production HIGH-MARGIN GROWTH ASSETS Rockies 2,780 Locations 18 mboe/d SIGNIFICANT CASH GENERATING ASSETS South Texas 3,100 Locations 112 mboe/d…
  20. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 20
    THE EVOLUTION OF CHESAPEAKE SIGNIFICANT PROGRESS HAS BEEN MADE WITH MORE TO COME Where We Have Been Where We Are Going GP&T commitments reduced Reducing leverage by 6.7 billion since 2014 2 3 billion of debt reduction targeted (42%…
  21. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 21
    Appendix Credit Suisse 23rd Annual Energy Summit 22
  22. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 22
    HEDGING POSITION AS OF 1/31/17 Natural Gas Oil NGL 2018 2018 2018 47 bcf 1.8 mmbbls Collars Collars 3.00/3.25/mcf 39.15/47/55/bbl NYMEX WTI 532 bcf Swaps 24 mmbbls Swaps 3.11/mcf 52.87/bbl NYMEX WTI 365 mbbls Propane…
  23. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 23
    GULF COAST EXCEPTIONAL DELIVERY LA Unleashing the Haynesville 20 180 160 Enhanced completions resulting in Equivalent Net Volume (mboe/d) meaningful NAV improvement 15 140 120 Unlocking the Bossier TIL Count 100…
  24. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 24
    HAYNESVILLE COMPETITIVE ADVANTAGE LA Average Cumulative Gas per Well 7.0 Average Cumulative Gas per Well (bcf) 6.0 17 5.0 16 4.0 14 15 3.0 2.0 10 13 08 09 1.0 0.0 0 2 4 6 8 10 12 14 Month Gulf Coast Acreage…
  25. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 25
    HAYNESVILLE PARADIGM SHIFT LA Strong across the field 26 wells with IP 30 greater than 30 mmcf/d Two pads, 134 mmcf/d BSNR 1H 37 mmcf/d w/ 9,800' LL BSNR 2H 32 mmcf/d w/ 9,800' LL BSNR 3H 35 mmcf/d, w/ 9,800' LL BSNR 4H 30…
  26. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 26
    BOSSIER UNLOCKED POTENTIAL LA Longest horizontal and largest completion First 10,000' lateral drilled and completed Reduced cluster spacing with 4,500 lb./ft. Exceptional reservoir quality and pressure Cumulative Production…
  27. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 27
    APPALACHIA SOUTH OH VALUE FOCUS 35 10% oil, 31% liquids140 Enhanced completions Improving cumulative production, while 30 120 continuing to optimize well spacing Equivalent Net Volume (mboe/d) 25 100 Two rig program in…
  28. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 28
    UTICA OH DRY GAS PERFORMANCE Optimizing design 20% improvement in 90-day cumulative production Continue to test economic bounds Acton 2 Well Pad Avg IP/well 13.8 mmcf/d Dec TIL High Yield Completion Performance Bozich…
  29. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 29
    UTICA OH WET GAS PERFORMANCE Enhanced completions 15 20% improvement in 180-day cumulative production ELLIE Continuing to optimize design and well spacing 8 Well Pad Avg IP/Well 1100 boe/d 65% liquids July TIL High Yield…
  30. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 30
    MID-CONTINENT 810,000 NET ACRES OF STACKED PAY POTENTIAL OK Oil growth potential Oswego provides low-cost, high-return oil, while commencing drilling in Chester, Hunton Plan forward in 2018 One rig dedicated to Oswego…
  31. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 31
    CHESTER PLAY THE NEXT STACKED PLAY OK Ragan 2820 3-22H 90 Day CUM = 61 mboe Transforming a vertical play with 64% liquids technology 2.2 bboe mean resource potential 8+ stacked reservoir targets Proven potential with 9,000+ CHK…
  32. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 32
    MID-CONTINENT OSWEGO LOW-COST, HIGH-RETURN OIL VOLUME Low cost Quick turnaround High return 3.7 per well D&C cost 40 50 day spud to TIL cycle time 60% rate of return core wells 650 boe/d avg IP30 Drill and TIL 25 30 wells in 2018…
  33. Credit Suisse Annual Energy Summit – Chesapeake Energy Corp – slide 33
    CORPORATE INFORMATION HEADQUARTERS PUBLICLY TRADED SECURITIES CUSIP TICKER 6100 N. Western Avenue 7.25% Senior Notes due 2018 165167CC9 CHK18A Oklahoma City, OK 73118 3mL + 3.25% Senior Notes due 2019 165167CM7 CHK19 WEBSITE: www.chk.com…

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