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IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Apr 10, 2018 · 44 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. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 1
    I PA A O i l & G a s Investment Symposium APRIL 10, 2018
  2. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 2
    PIONEER AT A GLANCE Permian pure play (post divestitures) Largest Midland Basin acreage position with Midland Basin decades of oil drilling inventory 750,000 gross acres Oil 20,000 drilling locations 66% 252 Gas Low-cost,…
  3. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 3
    2018 PLAN AND CAPITAL PROGRAM Plan to divest Eagle Ford, South Texas, Raton and West Panhandle assets during 2018, making Pioneer a Permian Basin pure play Data rooms opened in Q1 After the divestitures are completed, reported…
  4. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 4
    2018 PLAN AND CAPITAL PROGRAM (CONT.) The 2018 drilling program is expected to deliver Permian Basin oil production growth ranging from 19% to 24% compared to 2017 Total BOE production is forecasted to grow by 19% to 24% compared to…
  5. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 5
    2018 PLAN AND CAPITAL PROGRAM (CONT.) Expect to repay May 2018 debt maturity of 450 MM from cash on hand Net debt to 2018 operating cash flow forecasted to remain below 0.5x Based on Pioneers strong balance sheet, expected proceeds…
  6. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 6
    2018 CAPITAL PROGRAM 1 AND CASH FLOW 2018 capital program of 2.9 B Drilling and Completion Capital: 2.65 B 2018 Cash Flow Sensitivity to Forward Commodity Prices ( MM) 2.63 B Permian Basin (99% of total) (Permian Basin) 5.00 o…
  7. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 7
    LIQUIDITY POSITION Net debt at the end of Q4 2017 (reflects cash on hand, including liquid 0.6 B investments, of 2.2 B) Unsecured credit facility availability 1.5 B Net debt-to-book capitalization at the end of Q4 5% Expected to…
  8. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 8
    PERMIAN BASIN PRODUCTION GROWTH FORECAST Permian Basin Net Production 1 MMBOEPD Prolonged freezing temperatures in 176 184 MBOPD early January resulted in production 266 278 MBOEPD 700 losses of 6 MBOEPD for Q1 (includes impact of…
  9. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 9
    LOW-COST, HIGH-RETURN PERMIAN BASIN HORIZONTAL WELLS UNDERPIN PIONEERS 10-YEAR PLAN Pioneers 2017 Permian Basin Horizontal Low-Cost, High-Return Permian Basin Cost Structure (/BOE) Horizontal Wells 1.54 3.28 19 Grow Cash…
  10. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 10
    1 0 - Y E A R P L A N : S I G N I F I C A N T LY I M P R O V I N G F I N A N C I A L M E T R I C S 1 , 2 , 3 Cash Flow (B) Cash Flow Breakeven Oil Price 11 58 50 40 2.8 2018 2019 2020 2021 2022 2023 2024 2025 2026 2018…
  11. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 11
    2018 PERMIAN BASIN DRILLING PROGRAM Operating 20 horizontal rigs in the Permian Pioneers Acreage Position and 2018 Drilling Areas Basin Testing 45 wells in 1H with Version 3.0+ completions Northern Area Remaining wells for 2018…
  12. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 12
    E A R LY R E S U LT S F R O M 1 5 V E R S I O N 3 . 0 + C O M P L E T I O N S ENCOURAGING ( E X C L U D E S 5 W E L L S T H AT P O P D I N D E C E M B E R A N D A R E S T I L L C L E A N I N G U P ) North University Area: LSS Updated…
  13. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 13
    JO MILL PERFORMANCE ENCOURAGING Updated Jo Mill wells since Q3 2014 Early February 250 Jo Mill POP Locations Cumulative Production (MBOE)1 4 POPs during Q2 2017: 225 8,250 avg. lateral length Q4 Jo Mill POPs 2 POPs during Q3…
  14. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 14
    LATEST WOLFCAMP D WELL PERFORMANCE IMPRESSIVE Wolfcamp D Wells Updated Early February Q4 Wolfcamp D POP Location 200 Cumulative Production (MBOE)1 Shackelford well 175 9,700 lateral length 33 POPs between 2013 and 2015: 7,900…
  15. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 15
    UNLOCKING ACREAGE VALUE Midland Basin 2018 Appraisal Activity Prospective Horizontal Intervals Clearfork 1 Appraisal in 2018 Middle Spraberry Shale Jo Mill 19 Appraisals in 2018 Lower Spraberry Shale Wolfcamp A Full…
  16. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 16
    C O N T I N U I N G TO B U I L D O U T P E R M I A N B A S I N I N F R A S T R U C T U R E A N D V E RT I C A L I N T E G R AT I O N Tank Battery/Saltwater Disposal (SWD) Facilities/Below-Grade Cellars Tank Battery/SWD Expect to spend…
  17. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 17
    I N C R E A S I N G O I L TA K E AWAY TO T H E G U L F C O A S T A N D E X P O RT C A PA B I L I T Y P R O V I D E S L L S A N D B R E N T - R E L AT E D P R I C I N G Sales Volumes to Gulf Coast (MBOPD)1 115 Gulf Coast Midland 89…
  18. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 18
    PXD INVESTMENT HIGHLIGHTS Pioneer will be a Permian Basin pure play with 750,000 gross acres in the Midland Basin (post divestitures) High oil exposure from substantial resource potential in the Midland Basin: 20,000 drilling…
  19. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 19
    APPENDIX SLIDES 20
  20. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 20
    PRODUCTION BY COMMODITY Q4 '16 Q1 '17 Q2 '17 Q3 '17 Q4 '17 Midland Basin Oil (BOPD) 99,416 104,703 110,028 126,771 140,260 Horizontal NGL (BOEPD) 22,232 26,709 32,546 37,923 40,895 Gas (MCFPD) 105,826 128,130 150,061 149,286 174,613…
  21. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 21
    PRODUCTION COSTS (PER BOE) Q4 2017 compared to Q3 2017: 8.42 8.38 8.20 8.11 Workovers 0.59 7.60 LOE declined due to increasing 0.46 0.76 1.02 Production & 0.78 production attributable to lower cost Ad Valorem 1.78 2.11 Taxes…
  22. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 22
    CASH MARGINS BY ASSET Q4 2017 Cash Margin by Asset ( per BOE) Permian Permian Other Total Horizontals Verticals Eagle Ford Assets Company Realized price (ex-hedges) 41.27 39.81 31.86 23.46 38.68 Production costs1 (1.87) (16.02)…
  23. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 23
    PIONEERS YEAR-END 2017 PROVED RESERVES 1 Added 314 MMBOE from the drillbit, or 309% of full-year production, at a drillbit F&D cost of 8.46 per BOE2 Reflects successful Permian Basin and Eagle Ford horizontal drilling program Permian…
  24. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 24
    DERIVATIVE PHILOSOPHY Continue to use derivatives to mitigate commodity price exposure in order to support funding for development programs and to maintain strong financial position Continue to use a variety of derivative…
  25. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 25
    OPEN COMMODITY DERIVATIVE POSITIONS AS OF 2/5/18 Oil Q1 2018 Q2 2018 Q3 2018 Q4 2018 2019 Collars (BPD) 3,000 3,000 3,000 3,000 - NYMEX Short Call Price (/BBL) 58.05 58.05 58.05 58.05 - NYMEX Put Price (/BBL) 45.00 45.00 45.00…
  26. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 26
    OPEN COMMODITY DERIVATIVE POSITIONS AS OF 2/5/18 Ethane Q1 2018 Q2 2018 Q3 2018 Q4 2018 2019 Frac Spread (BPD) 1 2,500 2,500 2,500 2,500 2,500 MMBTUPD Equivalent 6,920 6,920 6,920 6,920 6,920 Price differential to NYMEX (/MMBTU)…
  27. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 27
    OPEN COMMODITY DERIVATIVE POSITIONS AS OF 2/5/18 Gas Q1 2018 Q2 2018 Q3 2018 Q4 2018 2019 Swaps (MMBTUPD) 1 61,111 100,000 100,000 100,000 - NYMEX Price (/MMBTU) 3.41 3.00 3.00 3.00 - Three Way Collars (MMBTUPD)1,2 100,000 50,000…
  28. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 28
    THREE-WAY COLLARS (40 BY 50 BY 65 EXAMPLE) NYMEX Oil Three-Way Collar Realization 80 Short-Put at Long-Put at Short-Call at 75 40/BBL 50/BBL 65/BBL 70 Potential Opportunity Loss Realized Price (/BBL) 65 Realize NYMEX plus…
  29. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 29
    MIDLAND BASIN MIDSTREAM INFRASTRUCTURE Gas Processing Pipeline NGL Takeaway Targa System to Mont Belvieu PXD has 27% interest Chaparral & West Texas Sale Ranch / Current capacity: 855 MMCFPD1 Martin County Pipelines PXD production…
  30. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 30
    INNOVATION WILL BE A KEY CONTRIBUTOR TO ACHIEVING PIONEERS 10 -YEAR VISION New technology initiatives are focused on 4-D fracture propagation modeling improving productivity Machine learning and artificial intelligence Predictive…
  31. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 31
    BENEFITS OF WATER REUSE VS. DISPOSAL Treatment & Blending SWD Existing Tank Battery Water Disposal Facility Tank Battery Water Reuse Storage Pond Produced Water Produced Water for Water Disposal Water Completion…
  32. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 32
    CASING DESIGN COMPARISON 3-String 4-String 13 3/8 Surface Casing 13 3/8 Surface Casing Water Disposal Zone 9 5/8 Intermediate Casing 9 5/8 Intermediate Casing (Higher Pressures) Clearfork - Spraberry (Lower Pressures) 7 5/8…
  33. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 33
    PERMIAN BASIN TAKES GLOBAL STAGE Total Recoverable Resource (BBOE)1 0 20 40 60 80 100 120 140 160 Ghawar, Saudi Arabia Permian Basin, USA Produced To Date Midland Basin Delaware Basin Burgan, Kuwait Safaniyah, Saudi Arabia…
  34. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 34
    PERMIAN BASIN REGIONAL OVERVIEW Outline of Central Basin Uplift Outline of Tatum Central Basin Platform Basin Grisham Fault Big Lake Fault Ozona Uplift Top Woodford structure (from Geomap) Kerr Devils River…
  35. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 35
    MIDLAND BASIN: STACKED PLAY POTENTIAL Midland Basin Clear Fork Delta log R (excess electrical resistance) Red intervals indicate hydrocarbons U. Spraberry M. Spraberry Petrophysical analysis indicates significantly more oil in…
  36. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 36
    REGIONAL CROSS SECTION D-D 13 horizontal play intervals identified (so far) Successful Horizontal Wells in the Play 10 intervals have been tested successfully Future Horizontal Play 3 additional intervals remain to be tested North D…
  37. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 37
    IMPACT OF HORIZONTAL TECHNOLOGY IN THE MIDLAND BASIN Midland Basin Production Midland Basin production has increased 1,300,000 BOEPD since 2009 From 2009 to 2012, production growth primarily attributable to increased…
  38. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 38
    PERMIAN BASIN HORIZONTALS ARE A GAME CHANGER The Permian Basin has produced 35 BBOE in the past 90 years with an estimated 150 BBOE recoverable resource remaining 2.5 160 Permian Basin Tight 140 Oil Production Daily Oil…
  39. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 39
    PERMIAN BASIN CONTINUES TO GROW Permian Basin is the only continuously growing major U.S. oil shale since downturn began 3.0 Permian Nov. 2014 Basin OPEC Decision 2.5 Million Barrels Oil Per Day 2.0 1.5 Eagle Ford…
  40. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 40
    OIL BREAKEVENS BY SHALE PLAY IN NORTH AMERICA 50 Breakeven Oil Price (/BBL) 40 30 20 10 - Midland Basin considered the top oil shale play in North America with a breakeven oil price of 24/BBL Source: Citi Research…
  41. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 41
    Horizontal Oil Rig Count 1,200 Peak: 1,115 1,000 800 U.S. 1/26/18: 662 +168% vs. bottom 600 1/26/18: 385 Previous +232% vs. bottom 400 Peak: 349 Bottom: 247 200 Permian Bottom: 116 0 Jun-11 Dec-11 Jun-12 Dec-12…
  42. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 42
    SUPPLEMENTAL INFORMATION Return on Capital Employed (ROCE) equals net income adjusted for tax-effected interest expense, net noncash MTM derivative gains and losses and other unusual items1 divided by the summation of average equity…
  43. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 43
    RESERVES AUDIT, F&D COSTS AND RESERVE REPLACEMENT An audit of proved reserves follows the general principles set forth in the standards pertaining to the estimating and auditing of oil and gas reserve information promulgated by the…
  44. IPAA Oil and Gas Investment Symposium – Pioneer Natural Resources Co. – slide 44
    COMMON SHARE REPURCHASES The stock purchase program allows for up to 100 million of stock to be repurchased during 2018. Pioneer may repurchase shares from time to time at managements discretion in accordance with applicable securities…

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