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HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp

Chesapeake Energy Corp · Mar 24, 2014 · 27 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. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 1
    HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE MARCH 24, 2014 NEW ORLEANS, LA Howard Weil 3-24-2014 1
  2. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 2
    KEY STRATEGIC TENETS Financial discipline Balance capital expenditures with cash flow from operations Divest noncore assets and noncore affiliates Reduce financial and operational risk and complexity Achieve investment grade…
  3. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 3
    OPERATING AREAS Utica Shale Marcellus Shale Powder River Basin: Niobrara Shale Mid-Continent: Mississippian Lime Haynesville Shale Mid-Continent: Cleveland Barnett Shale and Tonkawa Tight Sands Eagle Ford Shale…
  4. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 4
    ADJUSTED PRODUCTION GROWTH 2013 Asset Sale Adjustments (mmboe) 249 - 253 244 (1.2) (3.5) (3.6) (4.8) 231 2013 N. Eagle Ford Haynesville Miss. Lime JV Marcellus 2013 2014E Reported Adjusted Production Production…
  5. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 5
    PRODUCTION PROFILE NGL Oil Assoc. Natural Gas Dry Shale Gas Conventional Natural Gas Oil, NGL and associated natural gas from liquids plays continue to drive production growth; 25% CAGR in Liquids from 2010 - 2014…
  6. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 6
    CAPITAL DISCIPLINE (1) 2014 total capital expenditures expected to range from 5.2 5.6 billion; planned reduction of 20% YOY and 60% compared to 2010-12 average (1) Based on midpoint of company issued Outlook range provided…
  7. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 7
    CASH COST DISCIPLINE (1) (1) Excluding share-based compensation Howard Weil 3-24-2014 8
  8. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 8
    2014 CAPITAL ALLOCATION E&P Capex by Product(1) E&P Capex by…
  9. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 9
    EAGLE FORD GROSS OPERATED OIL PRODUCTION Chesapeake Peers Data Source: IHS Energy Howard Weil 3-24-2014 10
  10. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 10
    EAGLE FORD Avg. Well Cost ( in mm) Focused on continuous improvement Cycle time improvement of 20% in 2014 95% multi-well pad drilling utilization in 2014 Targeting further well cost improvement Plan to average 15 - 18 operated…
  11. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 11
    EAGLE FORD TRAJECTORY Maximizing investment efficiency Short-term rig reduction to develop inventory Future drilling approximately a 1:1 ratio of spuds to TIL Short-term reduction in oil volume growth during transition Operated…
  12. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 12
    MID-CONTINENT Program Efficiency vs. Rig Count Includes Mississippian Lime, Cleveland/Tonkawa and Granite Wash 2.5 mm net acre position, largely HBP Multiple stacked pay targets 7% decrease in D&C YOY 15% reduction in LOE YOY(1)…
  13. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 13
    UTICA Spud to Rig Release Cycle Times (days) Largest and most experienced operator Drilled more than 450 wells to date Improvement in EURs and PV through completion design optimization Growing processing capacity to drive…
  14. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 14
    MARCELLUS NORTH Continue to set production records Net Production (mmcf/d) Dec13 net production 845 mmcf/d 2014 development plan targeting EURs 10 Bcf and ROR 100% Plan to average 6 - 7 operated rigs in 2014 % Multi-well Pad…
  15. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 15
    HAYNESVILLE SHALE Avg. Well Cost ( in mm) 570,000 gross acres delineated and HBP Targeted Range: Industry-leading position in the core 700 operated producing wells More than 550 drill site pads constructed 4,500 well inventory on…
  16. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 16
    NEAR-TERM PRIORITIES Capital Efficiency Balance Sheet Improvement Cash Flow Growth Analyst Day: May 16th, 2014 - Oklahoma City, OK Howard Weil 3-24-2014 17
  17. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 17
    APPENDIX Howard Weil 3-24-2014 18
  18. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 18
    OPERATIONS 2014E Avg. Operated Rig Count 4Q13 Daily Avg. Net Production (mboe/d) 41 - 48 Liquids Focused Rigs 14 - 17 Natural Gas Focused Rigs 55 - 65 Total Operated Rigs (1) 2013 Year-End Drilled Well Inventory (Gross…
  19. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 19
    2013 FINANCIAL RESULTS ADJ. EARNINGS/FDS ADJ. EBITDA PROD. and G&A EXP. 146% YOY 34% YOY 15% YOY 1.50 5.0 billion 6.36/boe LIQUIDITY 2013 ASSET SALES TOTAL CAPEX 4.9 billion (1) 4.4 billion 49% YOY 6.7 billion(2) (1)…
  20. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 20
    2013 OPERATIONAL RESULTS TOTAL PRODUCTION LIQUIDS MIX OIL PRODUCTION 3% YOY to 25% of Total Production(1) 32% YOY 244 mmboe 20% in 2012 112.6 mbbls/d NGL PRODUCTION PROVED RESERVES PROVED DEVELOPED 19% YOY 2% YOY to 68% of…
  21. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 21
    BALANCE SHEET IMPROVEMENT (mm) 12/31/2012 12/31/2013 Unrestricted cash 287 837 +550 Working capital (1) (3,605) (2,696) +909 Other long-term liabilities (2) 1,176 984 +192 Long-term debt, net of disc. 12,157 12,886 -729 Total…
  22. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 22
    2014 HEDGES Natural Gas Oil 68% 58% 47% Swaps 4.18/mcf 93.92/bbl 21% NYMEX NYMEX Collars 4.09 - 4.38/mcf NYMEX (1) Hedged positions as of 1/31/2014 based on production estimates provided in 2/6/2014 Outlook; 21% of…
  23. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 23
    OUTLOOK SUMMARY 2014E Absolute production growth(1): Liquids 14 18% Oil 1 5% NGL(2) 40 45% Natural gas (2) 0% Total production 2 4% Daily rate (mboe) 680 695 % of production mix from liquids 29% % O/G revenues from liquids(3)…
  24. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 24
    SENIOR NOTE PROFILE 4,301 Sr. Debt and Average Average Term Loan Term Loan: Maturity: Interest Rate: Convertibles 12.8 Billion(1) 4.9 years 5.9% Other Sr. Notes ( in MM) 1,800 1,700 1,660 1,112 1,100 650 500 2014 2015…
  25. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 25
    RECONCILIATION ( in mm, except per share data) Twelve Months Ended: 12/31/2013 12/31/2012 Net income (loss) available to common stockholders 474 (940) Adjustments, net of tax: Unrealized gains on derivatives (100) (347)…
  26. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 26
    RECONCILIATION ( in mm) Twelve Months Ended: 12/31/2013 12/31/2012 Cash provided by operating activities 4,614 2,837 Changes in assets and liabilities 342 1,083 (1) Operating cash flow 4,956 3,920 Net income (loss) 894 (594)…
  27. HOWARD WEIL 42 ND ANNUAL ENERGY CONFERENCE – Chesapeake Energy Corp – slide 27
    CORPORATE INFORMATION CHESAPEAKE HEADQUARTERS PUBLICLY TRADED SECURITIES CUSIP TICKER 9.5% Senior Notes due 2015 165167CD7 CHK15K 6100 N. Western Avenue 3.25% Senior Notes due 2016 165167CJ4 CHK16 Oklahoma City, OK 73118 6.25%…

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