3Q18 Earnings Presentation & Penn Virginia Combination Update November 8, 2018 NYSE:DNR w w w. d e n b u r y. c o m
Agenda Introduction John Mayer, Director of Investor Relations Overview and Operational Update Chris Kendall, President & Chief Executive Officer Financial Review Mark Allen, Executive Vice President & Chief Financial Officer…
Overview & Operational Update Chris Kendall NYSE:DNR 5 w w w. d e n b u r y. c o m
Operating Margin Improvement 88% of oil price change contributed to higher Operating Margin 69.73 66.57 Revenue per BOE(1) 46.67 39.04 40.76 Operating Margin per BOE(2) 20.38 Marketing, Transportation and Taxes 6.47 5.07…
Mission Canyon Building on Recent Success Mission Canyon Exploitation Added 2nd rig in late 3Q Successful test at Cabin Creek with 24 hour rate 1000 BOPD Cedar Creek Anticline Potential to add up to 5 additional Cabin Creek…
Production by Area & 2018 Guidance Average Daily Production (BOE/d) 2018 Production Guidance (BOE/d) Field 3Q18 2Q18 3Q17 YTD 2018 Delhi 4,383 4,391 4,619 4,315 Hastings 5,486 5,716 4,867 5,634 Heidelberg 4,376 4,330 4,927 4,384…
Analysis of Total Operating Costs Total Operating Costs per BOE 3Q18 2Q18 3Q17 YTD 2018 (MM) (/BOE) (MM) (/BOE) (MM) (/BOE) (MM) (/BOE) CO2 Costs 14 2.63 16 2.92 18 3.22 48 2.88 Power & Fuel 34 6.31 35 6.19 34 6.18 106 6.39 Labor…
2018 Watch List 1H18 2H18 Development Oyster Bayou Facility Expansion Bell Creek Phase 5 Response West Yellow Creek Response CCA EOR Investment Decision Grieve Field Startup Delhi Tuscaloosa Infill Exploitation Cedar…
Financial Review Mark Allen NYSE:DNR 11 w w w. d e n b u r y. c o m
Recent Debt Transactions Further Improve Leverage Profile Net Debt Principal Reduction Since 12/31/14 9/30/18 Debt Maturity Profile (In millions) RECENT TRANSACTIONS (In millions) Over 1 Billion Net Debt Reduction Amended and Extended…
Significantly Improving Leverage Metrics TTM Leverage Ratio 3Q18 Annualized Leverage Ratio Trailing 12 months Trailing 12 months 3Q18 3Q18 in millions (incl. hedges) (excl. hedges) (incl. hedges) (excl. hedges) Adjusted EBITDAX(1)…
NYMEX Oil Differential Summary Another quarter of company-wide positive differential to NYMEX NYMEX Oil Differentials per barrel 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 Tertiary oil fields (1.07) (0.21) 2.27 1.61 0.54 2.37 Gulf Coast region…
Hedge Positions as of November 7, 2018 2018 2019 2020 Detail as of November 7, 2018 2H 1H 2H 1H 2H Volumes Hedged (Bbls/d) 15,500 Fixed Price Swaps (1) WTI Swap Price 50.13 NYMEX Volumes Hedged (Bbls/d) 5,000 3,500 Swap…
Selected Expense Line Items 3Q18 2Q18 YTD 2018 In millions, unless otherwise noted () (/BOE) () (/BOE) () (/BOE) Lease operating expenses(1) 123 22.50 120 21.34 361 21. 87 General and administrative expenses 22 3.96 19 3.44 61 3.71…
Denbury & Penn Virginia Combination Discussion Chris Kendall NYSE:DNR 17 w w w. d e n b u r y. c o m
The Combination of Denbury & Penn Virginia Rocky Mountain A Unique Energy Business Region Meaningful production growth while generating significant Combined Pro Forma free cash flow Highlights Balanced blend of enhanced oil…
Up to 140 MMBO EOR Potential on PVAC Acreage Significantly de-risked through more than 25 projects covering 200 wells Gonzales County EOR focus with 12 projects Successful peer projects immediately offsetting PVA acreage, focused on…
Applying Leading EOR Capabilities to the Eagle Ford Gonzales County Pilot Primary and EOR Oil Production 14,000 The EOR Process 12,000 EOR Production EOR Forecast Primary Production Rich hydrocarbon gas or CO2 is injected into a…
Eagle Ford is Ideally Suited for EOR Penn Virginias Drivers of EOR Niobrara Bakken Permian Eagle Ford Completion Complexity & Contact Area for Miscible Gas 2,500 lb/ft fracs 1,200 lb/ft fracs 1,500 lb/ft fracs 2,000 lb/ft…
Historic Eagle Ford EOR Project Performance Eagle Ford EOR Projects Gonzales County Oil Window Normalized to EOR Start Date 11,000 10,000 Pre EOR EOR 8 Gonzales County Projects with Long term 6000 BOPD 9,000 Performance 2.5X…
Penn Virginia Acreage EOR Timeline Estimate Eagle Ford stands out amongst other oily unconventional plays as the best EOR candidate Good containment of injected fluid Miscible across wide range of the oil window 1,000 wells expected…
Preliminary Combined Pro Forma Estimates Average Daily Production (BOE/d) Estimates thru 2020 assuming 60 70 WTI oil price 92,000 100,000 104,000 112,000 82,600 83,600 10% annual production growth 85% 90% oil production mix…
Uncommon Company, Extraordinary Potential Enhanced with Penn Virginia Combination Industry Leading Oil Weighting Extreme Oil Gearing Favorable Crude Quality & High Exposure to LLS Pricing Top Tier Operating Margin & Significant Free…
Q&A NYSE:DNR 26 w w w. d e n b u r y. c o m
Appendix NYSE:DNR 27 w w w. d e n b u r y. c o m
Reconciliation of Adjusted Net Income Reconciliation of Net Income (GAAP Measure) to Adjusted Net Income (Non-GAAP Measure)(1) 3Q18 2Q18 YTD 2018 Per Diluted Per Diluted Per Diluted In millions, except per-share data Amount Amount…
3Q18 Selected Financial Highlights In millions 3Q18 2Q18 YTD 2018 Reconciliation of Cash Flows from Operations (GAAP Measure) to Adjusted Cash Flows from Operations (Non-GAAP Measure)(1) Cash flows from operations (GAAP measure) 148…
Pro Forma Combined Capital Structure Financing Commitment Letter from JP Morgan Chase 1.2 billion new senior secured bank credit facility 0.4 billion senior secured 2nd lien bridge loan Est. Pro Forma for In millions, as of 9/30/18,…
Non-GAAP Measures Reconciliation of net income (GAAP measure) to adjusted EBITDAX (non-GAAP measure) 2017 2018 In millions Q4 FY Q1 Q2 Q3 TTM Net income (GAAP measure) 127 163 40 30 78 275 Adjustments to reconcile to Adjusted…
Non-GAAP Measures (Cont.) Reconciliation of net income (GAAP measure) to adjusted cash flows from operations (non-GAAP measure) to cash flows from operations (GAAP measure) 2017 2018 In millions Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Net income…
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