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1Q 2018 Earnings Presentation – Laredo Petroleum Inc.

Laredo Petroleum Inc. · May 2, 2018 · 29 slides

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Slides

  1. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 1
    Corporate Presentation May 2018
  2. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 2
    1Q-18 Highlights & FY-18 Expectations 21% Production growth YoY from 1Q-17 12% Increased anticipated FY-18E BOE production growth 25.91 1Q-18 cash margin per BOE 1.4x Net debt to Adjusted EBITDA1 58.5 MM utilized to…
  3. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 3
    Cash Margin Improved By Controlling Cash Costs 60 80% 75% 71% 70% 50 68% Cash Margin (% of realized) 60% 60% 40 51% 50% /BOE 30 40% 30% 20 20% 10 10% 0 0% 2014 2015 2016 2017 1Q-18 Unhedged Avg. Realized Price…
  4. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 4
    2018 Capital Program 2018 Capital Program 2018 Drilling & 700 Completions Plan 600 585 85 Completing 60 - 65 net wells 500 Capital ( MM) 10,600 avg. Hz lateral length 400 95% avg. working interest 300 Actively…
  5. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 5
    Operational Efficiencies Enable Us To Do More With Less 225,000 200,000 Gross Completed Lateral Feet per Rig 175,000 150,000 125,000 100,000 75,000 50,000 25,000 0 2013 2014 2015 2016 2017 2018E 35% YoY…
  6. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 6
    Consistent Production Growth Production 26 24 22 Total Production1 (MMBOE) 20 18 16 14 12 10 8 6 4 2 0 2011 2012 2013 2014 2015 2013 2017 2018E Oil Natural Gas NGL Expected Production 12% FY-18E YoY BOE…
  7. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 7
    Capitalizing On Our Contiguous Acreage Position 144,588 gross/124,382 net acres Longer laterals enhance returns 500 land-ready UWC/MWC locations of at least 15,000 Centralized infrastructure enables increased capital and…
  8. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 8
    Contiguous Acreage Facilitates Robust Infrastructure Investments Pipeline Infrastructure 60 miles crude gathering 100 miles water gathering/recycled distribution 190 miles natural gas gathering & distribution 50,000 1Q-18…
  9. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 9
    Crude Value Maximized Via Physical & Financial Contracts Physical Firm Transport LMS-owned gathering minimizes trucking Medallion contract provides intra-basin transport 30,000 BOPD gross firm transport provides access to…
  10. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 10
    Natural Gas Value Maximized Via Physical & Financial Contracts Operational Assurance Data from purchasers supports that they have sufficient firm transportation, and it is believed they can accommodate LPIs natural gas volumes LMS…
  11. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 11
    Significant Benefits Through Water Infrastructure Investments 10.3 MM LPI leasehold Water storage FY-18E LOE reduction generated by Water treatment facility Water lines (existing) Water lines (constructing) LMS water…
  12. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 12
    Infrastructure Investments Facilitate Lower Unit LOE 8 7 6 LOE/BOE (/BOE) 5 4 3 2 1 0 1Q-15 2Q-15 3Q-15 4Q-15 1Q-16 2Q-16 3Q-16 4Q-16 1Q-17 2Q-17 3Q-17 4Q-17 1Q-18 0.51 Per BOE savings on unit LOE in…
  13. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 13
    Advanced Subsurface Characterization Drives Optimized Development Physics-Based Workflows High-Resolution 3D Improved Analytics Reservoir Geomodels Bivariate analytics Acquire Production Subsurface Production data Variable…
  14. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 14
    Transitioning To Higher-Density Development 1 section 16 wells 1 section 32 wells Wolfcamp Upper Wolfcamp Middle Previous development Planned development using high-resolution 3D geomodels 32 locations Results of 2017…
  15. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 15
    Tighter Cluster Spacing Facilitates Higher-Density Development UWC/MWC NAV Per Spacing Unit 32 wells per spacing unit, 100% of type curve 16 wells per spacing unit, 120% of type curve 12 wells per spacing unit, 130% of…
  16. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 16
    Maintaining A Strong Balance Sheet 1.4x net debt to Adjusted EBITDA 1 Debt Maturity Summary 500 400 No debt due until 2022 5.625% and 6.250% notes both Debt ( MM) 300 currently callable 200 100 5.625% 6.250% 0 2017…
  17. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 17
    Stock Repurchase Program Approved by Board of Directors in 1Q-18 Allows stock repurchases of up to 200 MM Program authorized for two years 6,727,901 shares of common stock repurchased in 1Q-18 at a weighted-average price of…
  18. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 18
    Disciplined Risk Management Philosophy Protects Long-Term Value Hedge Settlements and Product Revenue vs. WTI Price 250 100 90 200 80 WTI Price (/Bbl) 150 70 MM 60 100 50 50 40 0 30 3Q-14 4Q-14 1Q-15 2Q-15…
  19. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 19
    Oil, Natural Gas & Natural Gas Liquids Hedges Hedge Product Summary 2Q-18 - 4Q-18 FY-19 FY-20 Oil total floor volume (Bbl) 7,168,750 6,606,500 1,061,400 Oil wtd-avg floor price (/Bbl) 47.42 48.82 49.70 Nat gas total floor volume…
  20. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 20
    2Q-18E Guidance 2Q-18E Production (MBOE/d)... 64.0 Crude oil production (MBbl/d)...... 27.4 Price Realizations (pre-hedge): Crude oil (% of WTI)..... 91% Natural gas liquids (% of WTI)......... 28% Natural gas (% of Henry Hub)....…
  21. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 21
    Positioned For The Future High-Density Operational Efficiencies facilitated by contiguous acreage Development enhancing shareholder value Production Corridors Consistent Growth reducing costs & enabling underpinned by strong…
  22. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 22
    APPENDIX
  23. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 23
    Low-Cost Proved Reserves Growth Total Proved Reserves 300 250 70 (0.2) (21) 216 200 167 MMBOE 150 100 PDP: 191 PDP: 141 50 0 YE-16 Revisions Divestitures Production YE-17 & Additions PUD Reserves 36% Organic…
  24. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 24
    UWC & MWC 1.3 MMBOE Cumulative Production Type Curve 1.3 MMBOE Cumulative Production Type Curve (42% Oil) 600 Cumulative Production 500 400 (MBOE) 300 200 100 0 12 Months 24 Months 36 Months 48 Months 60 Months…
  25. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 25
    2017 & 2018 Actuals 1Q-17 2Q-17 3Q-17 4Q-17 FY-17 1Q-18 Sales Volumes 3-Stream Sales Volumes MBOE 4,716 5,336 5,521 5,697 21,270 5,698 BOE/d 52,405 58,632 60,011 61,922 58,273 63,314 % oil 45% 47% 44% 43% 45% 43% 3-Stream…
  26. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 26
    2015 & 2016 Actuals 1Q-15 2Q-15 3Q-15 4Q-15 FY-15 1Q-16 2Q-16 3Q-16 4Q-16 FY-16 Sales Volumes 3-Stream Sales Volumes MBOE 4,274 4,234 4,124 3,714 16,346 4,204 4,338 4,718 4,889 18,149 BOE/d 47,487 46,532 44,820 40,368 44,782…
  27. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 27
    2014 Actuals: Two-Stream To Three-Stream Conversions 1Q-14 2Q-14 3Q-14 4Q-14 FY-14 2-Stream Sales Volumes MBOE 2,434 2,607 3,033 3,654 11,729 Sales Volumes BOE/d 27,041 28,653 32,970 39,722 32,134 % oil 58% 58% 59% 60% 59%…
  28. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 28
    Supplemental Non-GAAP Financial Measure Proved Developed Finding and Development Cost (Unaudited) Proved developed finding and development (F&D) cost per BOE is calculated by dividing (x) development costs for the period, by (y) proved…
  29. 1Q 2018 Earnings Presentation – Laredo Petroleum Inc. – slide 29
    Supplemental Non-GAAP Financial Measure Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net income or loss plus adjustments for depletion, depreciation and amortization, non-cash stock-based…

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