J.P. Morgan Energy Equity Conference June 19, 2018
XEC Statistical Summary Market Cap1 8.3 billion Debt/Adj. EBITDA2 1.2x Daily Production (1Q 18) 206 MBOE Proved Reserves (YE 17) 559 MMBOE % Natural gas 48% % Proved Developed 83% R/P Ratio 8.0x Quarterly Dividend 0.16/share…
Who is Cimarex Returns driven E&P company Focused on full cycle returns Balanced portfolio of assets Premier position in the Delaware Basin and Mid-Continent region Flexibility through commodity cycles Continuous idea generation…
Recent Accomplishments Sale of Ward County assets announced 570 million Portfolio Optimization High-grading of investment opportunities Enhanced completion design continues to yield improved well performance Additional spacing…
Focused on Full-Cycle Economics D&C Capital as a % of Total E&D Cimarex culture built on Actual Project Results* maximizing fully burdened after-tax rate of return on investment Half Cycle IRR Rigorous technical evaluation of all…
Solid History of Returns and a Bright Future Ahead Cash Return on Capital Employed (CROCE) 50% Three-year outlook*: 40% Maintenance capital of 700mm per year projected 30% to keep production flat 1.2 billion of D&C capital 20% per…
Return driven production growth continues in 2018 Daily Production (MBOE) High return projects expected to 211-221 generate 2018 production growth of 1116% 190 Oil expected to grow 2126% 164 161 Oil growth estimated at 3035% 145…
2018 Capital Investment Program E&D Capital of 1.6 1.7 billion 29% increase from 2017 Other Within cash available Meramec D&C Capital 1.3 1.4 billion 82% of Total E&D capital Permian Basin 70% D&C Capital 1.3 1.4 billion…
2018 Delaware Basin Plans Total D&C Capital Economies of Scale Activity by Area Ward Bone Single Spring well Reeves Eddy Avalon 885 935mm 80 Net Wells Multi-well Lea Culberson Wolfcamp 10
Delaware Basin Wolfcamp Overview 216,000 net acres in the fairway Multiple Wolfcamp Targets Culberson/White City Area 100,000+ net acres Upper & Lower Wolfcamp JDA with Chevron 2017/18 wells Reeves County Lower Wolfcamp Upper…
Well Productivity Improvements Long Lateral Upper Wolfcamp Wells (Culberson, Reeves and Ward Counties) 52 10,000-ft. lateral Upper Completion Generation IP180 (BOE/d) Wolfcamp wells drilled in Permian Basin since 2013 2,000 Improvement…
Culberson / White City Wolfcamp Details Lower Wolfcamp Upper Wolfcamp Operated SWD 100,000+ net acres; JDA with Chevron in Culberson County 72 long lateral wells Owl Draw 12 Seattle Slew spacing pilot 2,521 BOE/d (1,393 b/d)…
Culberson County Tim Tam Development Lower Wolfcamp Cumulative Production Tim Tam infill wells generated (MBOE) 700 67%+ ATAX return Infills have surpassed parent wells 600 in both landing zones 500 Results lead to 14 wells per…
Reeves County Focus Area 34 long lateral wells Targeting Upper Wolfcamp 28 10,000-ft. laterals producing Average 30-day peak IP of 1,809 BOE/d (49% oil) Dixieland State 55-6 2,505 BOE/d Two downspacing pilots producing (1,464…
Reeves County Strong Infill Well Results Cumulative Production (MBOE) Upper Wolfcamp 600 10,000-ft. laterals 500 Wood State: 6 wells testing 12 wells per section 400 Surpassed Big Timber, previously best long lateral to date 300…
Lea County Thyme APY 2,059 BOE/d Exciting multi-pay area (1,416 b/d) 225 million capital spend in 2018 Coriander AOC 1-12 Two Avalon wells brought online in 3,333 BOE/d (2,248 b/d) 1Q 18 Coriander AOC 1-12 State 1H with average…
Permian Basin Residue Gas Takeaway Sales agreements in place 98% of forecasted production through October 2019 El Paso or Waha index pricing Own and operate two gas gathering systems Triple Crown Culberson/Eddy Counties Matterhorn…
Permian Basin Oil Takeaway Sales agreements in place for oil volumes through 2018 & 2019 Strategic partnerships in core areas Pipelines in place Purchase obligations Midland index pricing 70% oil production on pipe Gas Plains…
Permian Basin Water Management Saltwater Disposal System Own and operate salt water disposal (SWD) systems in Culberson, Eddy and Reeves Improves operating costs Recycling produced water for completion operations 40% of total…
Mid-Continent Basin 2018 Outlook Total D&C Capital Economies of Scale Activity by Area Other Meramec Woodford Meramec Woodford Single well 375 425 41 Net Wells million Multi-well Lone Rock 22
Mid-Continent Overview Meramec and Woodford Stacked Targets Meramec: 116,500 net prospective acres 100% HBP Woodford: 136,500 net undeveloped acres (88% HBP) Meramec play outline Woodford play outline Cana core 23
Meramec The Big Picture Dupree BIA 1H 2,877 BOE/d (1,597 b/d) Rocky 1-17H Improving well results driving 1,912 BOE/d Tillman BIA 1H (1,282 b/d) activity 2,389 BOE/d (1,069 b/d) Thirteen 10,000-ft. lateral wells Mike Com 1H 4,353…
Meramec Development Plans 2018 developments Steve O 6 wells with 8 wells/section spacing (currently completing) Lehman 4 wells with 6 wells/section spacing Lehman Miss Mary 3 wells with 8 wells/section spacing Steve O Future…
Woodford Activity Long history of activity Emerging Lone Rock play yielding best results to date Clyde Copeland high density 14N10W spacing pilot yielding good results Clyde Copeland Formulating development plans in the 14N-10W…
Lone Rock Activity Jimmie Com Best Woodford returns in portfolio 16,000 net contiguous acres 10.2 MMcfed (368 b/d) Meyers 1H 13.4 MMcfed (535 b/d) Multiple completion design factors enhance productivity Infill testing: JD…
Well-positioned for 2018 Solid returns from large portfolio Strong financial position 464 million of cash on the balance sheet at March 31, 2018 Emphasis on execution Preserve returns in inflationary environment Idea generation…
Appendix 29
2018 Guidance Second Quarter Full Year Daily Production (MBOE) 200 209 211 221 % Oil 33% Capital Expenditures (billion) E&D 1.6 1.7 D&C 1.3 1.4 Midstream/Other 0.08 0.09 Expenses (/BOE) Production 3.80 4.30 Transportation,…
Hedges as of May 25, 2018 2018 2019 Second Third Fourth First Second Third Quarter Quarter Quarter Quarter Quarter Quarter OIL WTI Oil Collars1 Volume (Bbl/d) 31,000 27,000 21,000 15,000 15,000 8,000 Weighted Average Floor…
2018 Production Growth Daily Production Net Wells Online (MBOE) 49 50 211-221 206 200-209 190 34 23 15 2017A 1QA 2QE 3QE 4QE 2018E 1QA 2QE 3QE 4QE Wells Drilling or WOC at Oil 12/31/18 Permian Mid-Continent 32
Non-GAAP Reconciliation Reconciliation of Net Income to EBITDA and Adjusted EBITDA1 LTM ( in Millions) 2015 2016 2017 3/31/18 Net income (loss) (2,580) (409) 494 550 Income tax expense (benefit) (1,472) (214) 188 166 Interest…
Non-GAAP Reconciliation Reconciliation of cash flow from operations1 Debt/Cap calculation Three months Mar 31, Ended Mar 31, ( in Millions) 2018 ( in Millions) 2017 2018 Long-term debt (principal) 1,500 Net cash provided by operating…
Non-GAAP Reconciliation Cash Return on Capital Employed (CROCE) Cash Flow from Operating Activities+ After-tax Interest Expense Average Book Equity + Average Debt 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Cash flow from…
Clyde Copeland Results Cumulative Production (MBOE) Increased density pilot 350 8 wells testing 16 and 20 wells 300 per section 250 Results positive for future 200 well spacing 150 Interference testing on-going 100 50 Clyde Copeland…
Permian Basin Pilot Details Culberson Lower Wolfcamp Animal Red Hills Upper Wolfcamp Hallertau Kingdom development development Eight wells testing 14 wells per Five wells testing 12 wells per section section Waiting on completion…
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