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2Q 2021 Earnings Presentation – Silverbow Resources

Silverbow Resources · Aug 9, 2021 · 36 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 2021 Earnings Presentation – Silverbow Resources – slide 1
    SilverBow Resources Corporate Presentation August 2021
  2. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 2
    SilverBow Investment Highlights Pure Play Eagle Established operator with deep technical Ford E&P experience and in-basin knowledge Balanced Inventory provides optionality in capital allocation Commodity Mix based on prevailing…
  3. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 3
    Company Overview Mc Mullen Dimmit La Salle Live Oak Strategic Aim Targeted Results Webb SilverBow is an independent oil and gas company with operations across 130,000 net acres spanning all commodity phase windows of the…
  4. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 4
    2Q21: Strong Operations Driving Performance 2Q21 HIGHLIGHTS Reduced total debt by 72MM YoY, with 2Q21 Balance Sheet leverage ratio(1) of 1.93x vs 2.50x at YE20 2Q21 FCF of 7MM; Increased FY21 guidance by Free Cash Flow(2) 25%…
  5. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 5
    Deliberate and Patient Approach to A&D Since inception, SBOW has maintained a successful, consistent track record of both strategic A&D and organic growth within the Eagle Ford Lake Washington Gas Expansion Gas Expansion La Mesa…
  6. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 6
    2021: Key Objectives & Looking Ahead Key Objectives Grow Expand Drive De-lever production and high-return inventory peer-leading balance sheet through EBITDA while living through Austin Chalk capital efficiency debt reduction…
  7. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 7
    2021: Operational & Financial Summary Operations Capital Budget Eagle Ford Drilling Program 2021 Capital Budget of 115-130 MM Focus on capital efficiencies delivers Plan retains flexibility to 2% on long-term strategy reallocate…
  8. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 8
    Financial Discipline is Integral to Strategy Maintain strong balance sheet De-Levering the Balance Sheet(1) Active hedging program to protect returns 3.50x and minimize downside exposure 3.00x 2.50x 2.51x Working capital management…
  9. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 9
    Balanced Portfolio Provides Optionality Commentary Diversified Asset Base Development strategy has pivoted between gas and oil 40,000 net liquids acres focus over last 18 months as prices fluctuate 30% of total acreage M cMullen…
  10. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 10
    Top-Tier Dry Gas Assets U.S. Onshore Gas Plays 15% Full-Cycle IRR Gas Breakeven Prices(1) (/Mcf) 6.00 SBOWs Webb County Dry Gas is among the highest quality across all U.S. gas basins 4.84 5.00 4.07 4.00 3.79 3.25 3.31 3.32…
  11. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 11
    SilverBow Leads Pack in Top 50 Gas Wells Top 50 Wells First 3 Mo Cum Gas Production Top 50 Eagle Ford Gas Locations (MMcf) SilverBow (25) Legend SilverBow La Mesa (11) SilverBow Other Operators (14) SilverBow La Mesa Benchmarks Other…
  12. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 12
    Accretive Acquisition: La Mesa Transaction Overview Map New Acreage Subsequent to 2Q21, SilverBow acquired: 6 LEF / 6 UEF / 4 AC Incremental interest in 12 La Mesa PDP wells (12.5% to 20% WI) Incremental interest in future AC…
  13. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 13
    Webb County Austin Chalk Commentary SM Dimmit Austin Chalk Activity Map(3) La Salle Successfully completed initial test at Rio Bravo Currently working further delineation options Single well delivered at 6.0 million, expect to…
  14. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 14
    Strong Well Results Across Acreage Position A A B C B La Mesa II DVO La Salle Condensate AWP Rio Bravo Austin Chalk 6 Well Pad (La Mesa) Single Well (Rio Bravo) 15,899 net acres 12,223 net acres 51,441 net acres 30-day rate: 84…
  15. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 15
    Eagle Ford Operational Execution Drilling Metrics Drilling Cost Efficiencies Cost per Lateral Ft. (1) 362 276 194 191 Decrease in Drill Costs (2021 / 2018) -47% 2018 2019 2020 2021 Drilling Faster Increase in Lateral Ft…
  16. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 16
    Eagle Ford Operational Execution Completion Metrics Completion Cost Efficiencies Completing Faster Completion Costs (MM) (1) Stages Completed per Day (2) 5.1 Decrease in 3.9 9.2 9.9 11.6 Completion Cost (2021 / 2018) -33%…
  17. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 17
    Track Record of Performance & Managing Cycles Revenue LOE (MM) (/Mcfe) (MM) (/Mcfe) 100 6.00 7.5 0.60 83 82 6.3 78 5.8 80 66 5.00 5.6 5.7 5.6 62 6.0 5.2 5.3 0.50 5.0 60 54 55 4.00 43 4.5 0.40 40 3.00 3.0 0.30 20 2.00 0 1.00…
  18. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 18
    Built to Deliver Strong Margins at Low Prices Corporate Cash Margin (/Mcfe) 5.50 5.05 5.00 4.50 4.00 3.79 3.62 3.51 3.50 3.30 3.34 3.19 3.19 3.18 3.00 2.44 2.50 2.29 1.94 1.82 2.00 1.71 1.73 1.48 1.50 1.00…
  19. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 19
    Top Quartile Metrics Compared to Gas E&Ps 2021 FCF Yield(1) 35% 30% 25% 20% Peer Group Avg. (Excl. SBOW): 16% 15% 10% 5% - Cash flow generation and capital discipline driving double digit FCF yield…
  20. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 20
    ESG: At the Core of Our Business Environmental Social SilverBow is committed to reducing environmental impact SilverBow is committed to its workforce through cultural through sustainable operations SBOWay values Focused on reducing…
  21. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 21
    Leading ESG in the Eagle Ford 2019 Eagle Ford Operator Emission Intensity (Kg CO2e per Boe) 90.0 Leader in equivalent emissions intensity 80.0 across all Eagle Ford operators 70.0 60.0 50.0 40.0 SBOW 60% below Eagle Ford…
  22. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 22
    Eagle Ford: Geographically Advantaged Regional Pricing Benefits Sources of Demand Growth 100% of oil and gas production receives favorable Gulf LNG exports have rebounded in 1H21 to average 10.5 Coast pricing Bcf/d vs 7.5 Bcf/d in…
  23. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 23
    SilverBow Realizes Favorable Pricing Realized Oil Prices 95% of WTI Average Over (/Bbl) Last 8 Quarters (% of WTI) 70.00 120% 101% 98% 98% 96% 96% 60.00 92% 91% 86% 100% 50.00 80% 40.00 60% 30.00 40% 20.00 10.00 20% - - 3Q19…
  24. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 24
    Active Hedging Program to Protects Returns Manage commodity price risk through a disciplined risk management program Maintain a simple hedge portfolio comprised primarily of fixed price swaps and two-way collars Manage potential…
  25. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 25
    SilverBows Navigation Framework Todays E&P Industry is Exposed to Uncertain Fragmented, Debt Capital Intensive Commodity Prices Burdened To Succeed, SBOW Focuses on the Following Characteristics Focus on Capital Single-Basin…
  26. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 26
    SilverBows Value Proposition Pure Play Eagle Balanced Focus on Costs & Ford E&P Commodity Mix Margins Established operator with deep Inventory provides optionality in Peer-leading cost structure with technical experience and capital…
  27. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 27
    Appendix Corporate Presentation 28 8/4/2021
  28. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 28
    2021 Guidance ACTUAL GUIDANCE 3Q20 4Q20 FY20 1Q21 2Q21 3Q21 FY21 Production Volumes: Oil (Bbls/d) 5,127 4,655 4,157 3,497 2,745 3,600 - 3,850 3,650 - 3,900 Gas (MMcf/d) 129 130 139 140 174 156 - 168 155 - 163 NGL (Bbls/d) 3,773…
  29. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 29
    Consistent Results Establish Credibility = GUIDANCE RANGE = CONSENSUS = ACTUAL RESULTS 2Q21 201 213 Production (MMcfe/d) 1Q21 168 179 4Q20 170 183 Operating Costs 2Q21 0.64 0.72 (/Mcfe) 1Q21 0.69 0.77 4Q20…
  30. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 30
    Capital Structure & Credit Profile Revolving Credit Facility (due Apr-24) Capitalization(1) (MM, except per unit amounts) 300 million borrowing base Share Price (7/30/21) 19.82 198 million outstanding Shares Outstanding (7/30/21)…
  31. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 31
    Hedging Summary Current Hedge Position(1) 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 4Q 2022 1Q 2023 2Q 2023 (3 Months) (3 Months) (3 Months) (3 Months) (3 Months) (3 Months) (3 Months) (3 Months) NYMEX HH GAS Swaps Gas (MMBtu) 940,000…
  32. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 32
    Calculation of Adjusted EBITDA & Free Cash Flow (000s, except per unit metrics) 2020 2021 3Q 4Q FY 1Q 2Q Net Income / (Loss) (6,896) 9,348 (309,382) 28,380 (19,951) Plus: DD&A 13,975 13,434 64,564 13,393 16,039 Accretion of ARO 90…
  33. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 33
    Calculation of Return on Capital Employed (ROCE) (000s, except per unit metrics) 6/30/21 6/30/20 LTM LTM Net Income / (Loss) 10,881 92,745 Plus: DD&A 56,841 97,550 Accretion of ARO 330 333 Interest Expense 29,251 36,209…
  34. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 34
    Calculation of Cash General & Administrative Expenses (000s, except per unit metrics) 2020 2021 3Q 4Q FY 1Q 2Q General and administrative, net 5,833 4,682 22,608 4,782 4,834 Less: Non-cash Equity Compensation (1,066) (1,054)…
  35. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 35
    Reconciliation of PV-10 to Standardized Measure Estimates of future net revenues from our proved reserves, Standardized Measure and PV-10 (PV-10 is a non-GAAP measure defined below), as of December 31, 2020, is made in accordance with…
  36. 2Q 2021 Earnings Presentation – Silverbow Resources – slide 36
    SBOWay Corporate Information CORPORATE HEADQUARTERS SilverBow Resources, Inc. 920 Memorial City Way, Suite 850 Houston, Texas 77024 (281) 874-2700 or (888) 991-SBOW www.sbow.com CONTACT INFORMATION Jeff Magids Director of…

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