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2Q 2018 Corporate Presentation – Cimarex Energy Co.

Cimarex Energy Co. · Aug 7, 2018 · 38 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. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 1
    CORPORATE PRESENTATION August 2018
  2. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 2
    XEC Statistical Summary Market Cap1 9.0 billion Debt/Adj. EBITDA2 1.1x Daily Production (2Q18) 211 MBOE/d Proved Reserves (YE 17) 559 MMBOE % Natural gas 48% % Proved Developed 83% R/P Ratio 8.0x Quarterly Dividend 0.16/share…
  3. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 3
    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…
  4. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 4
    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…
  5. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 5
    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…
  6. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 6
    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…
  7. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 7
    Return driven production growth continues in 2018 Daily Production (MBOE) 214-221 14-18% pro forma* year-over- 190 year growth Oil up 20-25% 164 161 145 31% 31% 30% 30% 28% 2014 2015 2016 2017 2018E *for the previously…
  8. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 8
    2018 Production Growth Daily Production Net Wells Online (MBOE) 49 214-221 211 206-215 206 190 38 37 23 15 2017A 1QA 2QA 3QE 4QE 2018E 1QA 2QA 3QE 4QE Wells Drilling or Oil Permian Mid-Continent WOC at 12/31/18 9
  9. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 9
    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…
  10. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 10
    2018 Delaware Basin Plans Total D&C Capital Economies of Scale Activity by Area Ward Single Bone well Eddy Spring Reeves Avalon 82 Net Wells 885 935mm Lea Multi-well Wolfcamp Culberson 11
  11. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 11
    Delaware Basin Wolfcamp Overview 2017/18 wells Lower Wolfcamp Upper Wolfcamp 196,000 net acres in the Bone Spring fairway Multiple Wolfcamp Targets Culberson/White City Area 100,000+ net acres Upper & Lower Wolfcamp JDA with…
  12. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 12
    Well Productivity Improvements Long Lateral Upper Wolfcamp Wells (Culberson and Reeves Counties) 49 10,000-ft. lateral Upper Completion Generation IP180 (BOE/d) Wolfcamp wells drilled in Permian Basin since 2013 2,000 Improvement in…
  13. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 13
    Resilient Long Lateral Returns Culberson Long Lateral Wolfcamp BTAX IRR* 400% 300% 200% 100% 0% 30 40 50 60 70 Realized Oil Price Upper Wolfcamp - 2/Mcf Lower Wolfcamp - 2/Mcf Upper Wolfcamp - 1/Mcf Lower Wolfcamp -…
  14. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 14
    Culberson / White City Wolfcamp Details Lower Wolfcamp Upper Wolfcamp Operated SWD 100,000+ net acres; JDA with Chevron in Culberson County 75 long lateral wells Animal Kingdom Lower Owl Draw 12 2,521 BOE/d Wolfcamp infill…
  15. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 15
    Culberson County Tim Tam Development Lower Wolfcamp Cumulative Production Tim Tam infill wells generated 67%+ (MBOE) ATAX return 700 Infills have surpassed parent wells in both landing zones 600 Tim Tam spacing 500 Lower…
  16. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 16
    Reeves County Focus Area 36 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…
  17. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 17
    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…
  18. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 18
    Lea County Thyme APY Coriander AOC 1-12 4,600 Lateral 9,500 Lateral 2,059 BOE/d 3,333 BOE/d (1,416 b/d) (2,248 b/d) Exciting multi-pay area Upper Wolfcamp Avalon 2018 Capex: 225 million Bone Spring Two Avalon wells brought online…
  19. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 19
    Permian Basin Residue Gas Takeaway Sales agreements in place 98% of forecasted production through December 2019 El Paso or Waha index pricing Own and operate two gas gathering systems Triple Crown Culberson/Eddy Counties Matterhorn…
  20. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 20
    Permian Basin Oil Takeaway Sales agreements in place for oil volumes through 2019 Strategic partnerships in core areas Pipelines in place Purchase obligations Midland index pricing 70% of oil production on pipe; increasing to 80%…
  21. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 21
    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…
  22. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 22
    Mid-Continent Basin 2018 Outlook Total D&C Capital Economies of Scale Activity by Area Other Woodford Meramec Woodford Meramec Single well 375 425 41 Net Wells million Multi-well Lone Rock 23
  23. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 23
    Mid-Continent Overview Meramec outline Woodford outline Meramec and Woodford Stacked Targets Meramec: 116,500 net prospective acres 100% HBP Woodford: 136,000 net undeveloped acres Cana Core 24
  24. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 24
    Meramec The Big Picture Dupree BIA 1H 1 Mile 2,877 BOE/d 116,00 net acres (1,597 b/d) Rocky 1-17H 100% HBP Improving well results driving activity 1 Mile Gresham Com 1H 1,912 BOE/d 2 Mile (1,282 b/d) 5,813 BOE/d Four…
  25. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 25
    Meramec Development Plans 2018 developments Steve O 6 wells (2 mile Lehman laterals) with 8 wells/section spacing (flowing back) Steve O Lehman 4 wells (1 mile) with 6 wells/section spacing Miss Mary Miss Mary 3 wells (1 mile)…
  26. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 26
    Woodford Activity Operated well Non-operated well Participated in 959 wells 14N 10W drilled since 2007 325 operated wells Emerging Lone Rock play Clyde Copeland yielding best results to date Formulating development plans in the…
  27. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 27
    Lone Rock Activity Jimmie Com Best Woodford returns in portfolio 6,700 Lateral 10.2 MMcfed Meyers 1H 16,000 net contiguous acres (368 b/d) Multiple completion design factors 8,000 Lateral 13.4 MMcfed Hines Federal 1H (535…
  28. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 28
    Well-positioned for 2018 Solid returns from large portfolio Strong financial position 411 million of cash on the balance sheet at June 30, 2018 Emphasis on execution Preserve returns in inflationary environment Idea generation…
  29. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 29
    Appendix 30
  30. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 30
    2018 Guidance 3Q18E FY18E Production (MBOE/d) 206 - 215 214-221 Oil Production (Bbls/d) 61,500 64,500 66,000 68,000 Capital Expenditures (billion) E&D 1.6 1.7 D&C 1.3 1.4 Midstream/Other 0.08 0.09 Expenses (/BOE) Production…
  31. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 31
    Hedges as of August 3, 2018 2018 2019 Third Fourth First Second Third Fourth Quarter Quarter Quarter Quarter Quarter Quarter OIL WTI Oil Collars1 Volume (Bbl/d) 35,000 29,000 23,000 23,000 16,000 8,000 Weighted Average Floor…
  32. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 32
    Permian Region Production Daily Production (MBOE) 125 122 112 114 107 105 99 100 96 94 87 85 86 85 81 80 75 50 25 0 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Oil NGL Natural…
  33. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 33
    Mid-Continent Region Production Daily Production (MBOE) 91 88 89 85 85 82 81 77 77 74 74 75 71 70 68 50 25 0 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 Oil NGL Natural Gas 34
  34. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 34
    Non-GAAP Reconciliation Reconciliation of Net Income to EBITDA and Adjusted EBITDA1 LTM ( in Millions) 2015 2016 2017 6/30/18 Net income (loss) (2,580) (409) 494 593 Income tax expense (benefit) (1,472) (214) 188 150 Interest…
  35. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 35
    Non-GAAP Reconciliation Reconciliation of cash flow from operations1 Debt/Cap calculation Six Months Ended Jun 30, June 30, ( in Millions) 2018 ( in Millions) 2017 2018 Long-term debt (principal) 1,500 Net cash provided by operating…
  36. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 36
    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…
  37. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 37
    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 Clyde Copeland…
  38. 2Q 2018 Corporate Presentation – Cimarex Energy Co. – slide 38
    Permian Basin Development Pilot Details Culberson Lower Wolfcamp - Animal Kingdom Animal Kingdom spacing Eight wells testing 14 wells per section Lower Wolfcamp 225 Waiting on completion 1,216 225 1,216 Red Hills (Lea)…

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