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Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc.

PDC Energy, Inc. · Jun 5, 2019 · 30 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. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 1
    COMPANY UPDATE June 2019
  2. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 2
    PDC ENERGY Company Overview 2.0B Market Cap(1) 3.3B Enterprise Value(1) 545 Core Wattenberg Delaware Basin 96,000 net acres(2) 42,000 net acres(3) 425 MMBoe proved reserves 120 MMBoe proved reserves YE18 Proved…
  3. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 3
    PDC ENERGY Strong Balance Sheet, Low Leverage and Ample Liquidity As of March 31, 2019 Leverage and Liquidity Debt Maturity Schedule 1,500 TTM leverage ratio of 1.5x (millions) Total liquidity of 1.2 billion Revolver 1,250 125…
  4. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 4
    PDC ENERGY 2019 Plan Expected to Deliver Differentiating Results 55/Bbl WTI and 3/Mcf NYMEX Prices Adj. Cash Flow Capital 2019 Guidance Overview from Ops Investment(1) (880 - 930MM) (810 - 870MM) Full-year plan generates 65MM FCF at…
  5. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 5
    PDC ENERGY 2019 Full-Year Guidance 2019 Guidance LOE/Boe 4.00 Production: 46 50 MMBoe 2.85 - 3.15 Capital Investments: 810 870 million 3.00 2019e Price Realizations Commodity Mix 2.00 (% NYMEX) (ex. TGP) Oil: 90 95% 1.00 Gas:…
  6. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 6
    PDC ENERGY Returning Capital to Shareholders Key Considerations in Stock Repurchase Program Board approved program Up to 200 million program, dependent upon market conditions Near-term value-creation Execution of program with…
  7. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 7
    2019-2020 OUTLOOK Free Cash Flow & Debt-Adj. Per Share Growth Outlook Reflects 55/3 NYMEX 2019 Highlights Production and Leverage Ratio Outlook 80 2.0x Production Commitment to capital discipline 70 Leverage Ratio Capital…
  8. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 8
    ASSET OVERVIEW
  9. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 9
    CORE WATTENBERG Prolific Asset in Development Mode 1Q19 Results 96,000 Net Acres(1) 100,000 Boe/d Prairie Area 30% Y/Y Growth Kersey Area 38 Spuds 425 YE18 Proved Reserves (MMBoe) 32 TILs 2.63 LOE/Boe Plains Area…
  10. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 10
    CORE WATTENBERG Safely Developing Rural Acreage in Weld County PDC has operated in the Wattenberg Field of the DJ Basin for almost 20 years Field office of 250 employees located in Evans Eaton Consolidated acreage position…
  11. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 11
    Core Wattenberg 2019 Plan Significantly Enhances Efficiencies Capital investment of 500 MM TILs by Lateral Length 2018 2019 Three rigs and one completion crew SRL/MRL/XRL well costs of 3/4/5 MM with average spud to spud drill times…
  12. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 12
    CORE WATTENBERG Efficiency Gains & Commitment to Capital Discipline Operational Efficiencies Core Wattenberg benefiting from consolidated acreage position Track record as best-in-class operator Continue to meet drill time…
  13. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 13
    CORE WATTENBERG Expected to Benefit from 3rd Party Midstream Expansions Consistent run-time benefits core acreage line pressures and PDC volumes Plant 11 (OConner 2) 200 MMcf/d expected June Prairie Area 2019 start-up Additional…
  14. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 14
    DELAWARE BASIN Primary Focus in Two Oil-Rich Areas 1Q19 Results 42,000 25,000 Boe/d Net Acres(1) 20% Y/Y Growth 10 Spuds 120 YE18 Proved Reserves 9 TILs (MMBoe) 5.15 LOE/Boe (1) 2018 Year-End net acreage count of…
  15. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 15
    Delaware Basin Steady Progress Towards Development Mode Capital investment of 350 MM TILs by Lateral Length 2018 2019 Includes 40 MM of planned midstream investment (portion of which expected to be refunded with midstream…
  16. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 16
    DELAWARE Efficiency Gains & Commitment to Capital Discipline Operational Efficiencies Delaware Basin continued operational improvements Faster drill times More completion stages per day Improved well costs Strong well performance…
  17. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 17
    DELAWARE Systematic Improvements Quarter-Over-Quarter Drilling Completions Consistent improvements in average drill times over past Modified completion design over time delivers consistent two years improvements in completion costs…
  18. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 18
    DELAWARE Strong Results in Oily Areas of Block 4 Continue to Test Optimal Spacing Design Windy Mountains Block 4 Wolfcamp A 2-well XRL pad Lower WCB GOR and performance above Area 3 expectations Average 30-day peak IP 167 Boe/1,000…
  19. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 19
    DELAWARE MIDSTREAM Executes Definitive Monetization Agreements Agreements cover sale of all of PDCs gas, water and oil related midstream assets in the Delaware Basin Substantial Capital Avoidance in the Future Premier Midstream…
  20. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 20
    PDC ENERGY Delivering Strong Value in 2019 65MM 2019e Free Cash Flow (Assuming 55/3 NYMEX) Returns Results Responsibility Strong Returns on Core Wattenberg and Delaware basins projects generate solid debt- 350MM adjusted…
  21. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 21
    Investor Relations Mike Edwards, Senior Director Investor Relations michael.edwardspdce.com Kyle Sourk, Manager Investor Relations kyle.sourkpdce.com Corporate Headquarters Website PDC Energy, Inc. www.pdce.com 1775 Sherman…
  22. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 22
    APPENDIX
  23. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 23
    CORE STRATEGIC PRIORITIES Built to Deliver Sustainable, Long-Term Value PRIORITIZE HEALTH, SAFETY & THE PROVIDE TOP-TIER FINANCIAL ENVIRONMENT & PERFORMANCE METRICS Maintain top-tier Balance Sheet PDCs top priority. Be a good…
  24. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 24
    STRATEGIC PRIORITIES Adapting to the Changing Landscape Multi-Year Planning Focused to Achieve Specific Targets at 50 Oil & 3 Gas 1 Sustainable FCF Year-over-year growth in FCF of 50MM Consideration of opportunities to return…
  25. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 25
    EXECUTIVE COMP. New Metrics Demonstrate Commitment to Capital Efficiency 50% Qualitative & 50% Quantitative Free Cash Flow Margin 1 Percentage measurement of free cash flow divided by capital investments New 2 Metrics 0 Debt-Adj.…
  26. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 26
    FINANCIAL RESULTS Steady G&A Improvements 2019 G&A per Boe guidance in-line with peers G&A per Boe 2019 guidance includes cash and non-cash G&A 6.00 5.85 Successful effort accounting with minimal capitalized G&A 5.07 compared to…
  27. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 27
    OPERATIONS Wattenberg Performance Drives Steady Improvements Strong Wattenberg performance due to steady third- Declining LOE per Boe coincides with increased party processing throughput Wattenberg production associated with 3rd party…
  28. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 28
    PDC ENERGY Corporate Social Responsibility SAFE OPERATIONS EMPLOYEES MATTER COMMUNITY OUTREACH June 2019 29
  29. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 29
    Reconciliation of Non-U.S. GAAP Financial Measures Adjusted Net Income Three Months Ended March 31, 2019 2018 Adjusted net income: Net loss (120.2) (13.1) Loss on commodity derivative instruments 190.1 47.2 Net settlements on…
  30. Bank of America Merrill Lynch Energy Credit Conference – PDC Energy, Inc. – slide 30
    Reconciliation of Non-U.S. GAAP Financial Measures Adjusted EBITDAX Three Months Ended March 31, 2019 2018 Net loss to adjusted EBITDAX: Net loss (120.2) (13.1) Loss on commodity derivative instruments 190.1 47.2 Net settlements…

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