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Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co.

Pioneer Natural Resources Co. · Nov 12, 2014 · 50 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 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 1
    Investor Presentation November 2014
  2. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 2
    Pioneer At A Glance 28 B 3.1 B 11 BBOE Top U.S. Fields By Rig Count2 Current 2014 Planned Proved 310 (Pioneer Operated Count in Green 38 rigs) Enterprise Drilling CapEx Reserves + Value Net Resource 220 218 192 Potential 84 78 62…
  3. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 3
    Capital Funding Rationale Current 1 B equity offering, combined with the expected sale of Pioneers Eagle Ford Shale Midstream business, is expected to allow Pioneer to prudently develop its assets in a 70 to 80 oil price environment…
  4. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 4
    Eagle Ford Shale Midstream Divestiture Pursuing divestment of Pioneers 50.1% share of Eagle Ford Shale Midstream business Joint divestiture process with Reliance Holding USA, Inc. (remaining 49.9%) Pioneer is the operator Data room…
  5. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 5
    Spraberry/Wolfcamp: World-Class Asset Over the 2011 2014 period, Pioneer has successfully transformed its Spraberry/Wolfcamp acreage from a vertical play into a world-class horizontal play Successfully appraised 6 highly prospective…
  6. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 6
    Pioneers Efforts Have Dramatically Increased Spraberry/Wolfcamp Resource Potential1 Capital Efficiency Driving Transition from Vertical to Horizontal Development 2011 2014 Spraberry/Wolfcamp Net Recoverable Spraberry/Wolfcamp Net…
  7. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 7
    Executing on the Growth Plan Q3 2014 production: 186 MBOEPD from continuing operations1 Top end of Q3 production guidance range of 181 MBOEPD 186 MBOEPD Up 10 MBOEPD, or 6%, compared to Q2 2014 (oil production up 9 MBOPD, or 12%)…
  8. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 8
    Executing on the Growth Plan (cont.) Northern Spraberry/Wolfcamp horizontal oil drilling Production data from 56 Wolfcamp A, B and D wells and 9 Lower Spraberry Shale wells placed on production in 2013 and during the first 9 months of…
  9. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 9
    Narrowed 2014 Production Growth Range from 16% - 19% to 18% - 19%1 FY Guidance MBOEPD1 Narrowed 182 - 183 guidance range 180 - 185 Mid-October Rate: 195 MBOEPD 200-205 186 176 166 155 137 59% 63% 66% 66% 69% 75%…
  10. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 10
    Pioneers 2013/9-Months 2014 Northern Spraberry/Wolfcamp Program Successfully placed 56 horizontal Wolfcamp and 9 horizontal Lower Spraberry Shale wells on production during 2013 and 9 months 2014 Pioneers Northern Well Count…
  11. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 11
    Production for Northern Wolfcamp B Horizontal Wells Drilled to Date1 Updated End September 2,000 Wolfcamp B: 33-well average in Midland, Martin, Glasscock and Andrews counties; 7,700 avg. lateral length 1,000 Daily Production…
  12. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 12
    Production for Northern Wolfcamp A Horizontal Wells Drilled to Date1,2 2,000 Updated End September Wolfcamp A: 12-well average in Midland and Glasscock counties; 6,940 avg. lateral length 1,000 Daily Production (BOEPD)…
  13. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 13
    Production for Northern Wolfcamp D Horizontal Wells Drilled to Date1 2,000 Updated End September Wolfcamp D: 11-well average in Midland, Martin, Glasscock and Andrews counties excludes two underperforming wells drilled in Tier 2 to…
  14. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 14
    Production for Northern Lower Spraberry Shale Horizontal Wells Drilled to Date1 2,000 Updated End September Lower Spraberry Shale: 9-well average in Midland, Martin, Glasscock and Andrews counties; 5,920 avg. lateral length 1,000…
  15. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 15
    Recent Middle Spraberry Shale and Jo Mill Shale Horizontal Results Recent Q3 Middle Spraberry Shale well (Pembrook 1402H) in Upton County; 4,982 lateral length Updated End September 2,000 Middle Spraberry Shale: PSU 1702H in Midland…
  16. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 16
    Continuing to Successfully Grow Spraberry/Wolfcamp Production Spraberry/Wolfcamp Net Production (MBOEPD)1 Narrowed 98 100 MBOEPD 73 horizontal wells placed on production in Q3 guidance to upper end of range 96 100 MBOEPD 33 in…
  17. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 17
    Pioneers 10-Year Plan for Spraberry/Wolfcamp Resource Development Optimized Marketing/ Procurement/ Development Plan Takeaway Gas Processing Services Cushing Keystone South Seaway Permian Basin Wink GC Market…
  18. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 18
    Meeting Long-Term Water Requirements Objective: Reduce reliance on fresh water used in drilling and fracture stimulation Frac Pond in Midland County operations, mitigate the need for disposal of produced water through recycling and…
  19. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 19
    Constructing Field-Wide System for Water Transport Field-wide system expected to include: 100 mile mainline 30 to 36 diameter o Includes fiber optic cable to support field communications Feeder lines from Odessa and Midland effluent…
  20. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 20
    Benefits of Water Project for Pioneer Ensures availability and improves deliverability of low-cost, long-term water supply across Pioneers Spraberry/Wolfcamp acreage position Provides a significant reduction in the cost of water for…
  21. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 21
    Field Infrastructure Tank Batteries & Gas Processing Tank Batteries / Saltwater Disposal New large-scale tank batteries and saltwater disposal New DL Hutt Tank Battery facilities being constructed to optimize future horizontal…
  22. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 22
    Brady Sand Mine Expansion Pioneers Brady, Texas sand mine is Brady Sand Mine strategically located within close proximity (190 miles) of the Spraberry/Wolfcamp Current capacity: 750 M tons per year Total proved reserves + probable…
  23. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 23
    Eagle Ford Shale Downspacing and Staggering Update Expect to place 50 wells on production in 25% of acreage prospective for Upper Eagle Ford Shale Upper targets during 2014 as part of the downspacing and staggering program in the…
  24. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 24
    Continuing to Successfully Grow Eagle Ford Shale Production Eagle Ford Shale Net Production (MBOEPD)1 Narrowed 46 47 MBOEPD Record Eagle Ford Shale net production of 47 MBOEPD guidance range 46 49 MBOEPD in Q3 Placed 35…
  25. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 25
    Optimizing Returns in a Lower Oil Price Environment Aggressively solicit cost reductions from service companies Focus Spraberry/Wolfcamp drilling activity on the best intervals Primarily drill Wolfcamp B, Wolfcamp A and Lower…
  26. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 26
    PXD Investment Highlights U.S. asset base High oil exposure from proved reserves + estimated net resource potential of 11 BBOE Drilling program focused in liquids and resource rich core assets in Texas Spraberry/Wolfcamp Shale…
  27. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 27
    Appendix 28
  28. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 28
    Pioneers Areas of Operations Current Total Enterprise Value (B) 28 Q2 2014 Production (MBOEPD) 186 2014E Total Capital Spend, Net (B) 3.4 Current Headcount 4,200 Raton West Panhandle Northern Spraberry/Wolfcamp Dallas…
  29. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 29
    Pioneers Significant Proved Reserves and Recoverable Resource Potential1 Proved Reserves + Estimated Net Recoverable Resource Potential of 11 BBOE 22,000 Horizontal Drilling Locations 12/31/13 Proved Reserves: 845 MMBOE2 Additional…
  30. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 30
    Pioneers YE 2013 Proved Reserves1 Added 141 MMBOE from the drillbit, or 211% of full- year production, at a drillbit F&D cost of 19.70 per BOE2 Reflects significant drilling campaigns in horizontal Spraberry/Wolfcamp Shale and Eagle…
  31. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 31
    Production Costs (per BOE)1 14.15 14.30 2014 production costs trending 13.90 13.39 13.17 down as additional lower-cost Workovers 0.72 0.76 0.59 0.55 0.63 horizontal Spraberry/Wolfcamp Production & 3.51 3.68 3.52 wells are placed…
  32. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 32
    Liquidity Position (9/30/14) Net debt (net of cash balance of 550 MM): 2.1 B Unsecured credit facility availability: 1.5 B Net debt-to-book capitalization: 23% Maturities and Balances1 2016 2017 2018 2020 2022 2028 455 MM 485…
  33. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 33
    Pioneers Production By Commodity By Area Q3 '13 Q4 '13 Q1 '14 Q2 '14 Q3 '14 Spraberry/Wolfcamp Oil (BOPD) 51,903 52,957 58,307 57,893 66,425 NGL (BOEPD) 16,200 16,251 16,693 19,754 21,734 Gas (MCFD) 62,939 65,863 66,770 83,368 86,412…
  34. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 34
    Derivative Philosophy Continue to use derivatives to mitigate commodity price exposure in order to ensure funding for development programs and to maintain strong financial position Target 50% on rolling 3 year basis Continue to use a…
  35. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 35
    Open Commodity Derivative Positions as of 10/30/2014 Oil Q4 2014 2015 2016 Swaps WTI (BPD) 15,000 - - NYMEX WTI Price (/BBL) 96.31 - - Three Way Collars (BPD)1,2 69,000 95,767 70,000 NYMEX Call Price (/BBL) 114.05 99.36 96.86…
  36. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 36
    Open Commodity Derivative Positions as of 10/30/2014 Natural Gasoline Q4 2014 2015 2016 Three Way Collars (BPD)1,2 3,500 - - Mont Belvieu Call Price (/BBL) 97.93 - - Mont Belvieu Put Price (/BBL) 90.14 - - Mont Belvieu Short…
  37. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 37
    Open Commodity Derivative Positions as of 10/30/2014 Gas Q4 2014 2015 2016 Swaps - (MMBTUPD) 195,000 20,000 70,000 NYMEX Price (/MMBTU)1 4.04 4.31 4.06 Three Way Collars (MMBTUPD)1,2 115,000 285,000 20,000 NYMEX Call Price…
  38. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 38
    Three-Way Collars (75 by 90 by 135 Example) Unhedged realization Hedged realization 160.00 NYMEX Price 150.00 Potential 140.00 Opportunity Loss Realized Price 130.00 Realized Price (/BBL) Short put at 75/BBL Long put at…
  39. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 39
    Geologic Provinces of the Permian Basin PEDERNAL UPLIFT & ROOSEVELT POSITIVE OZONA PLATFORM Basin DEVILS Basement RIVER Uplift UPLIFT Shelf Thrust Belt Permian Basin is composed of multiple uplifts and basins that…
  40. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 40
    Wolfcamp Depositional Model Midland Basin Platform Platform Carbonate Land Carbonate Shelf Edge Carbonate Pelagic Sediments Clastic Detrital Slope Sediments & Reef Talus Fluvial - Deltaic Silt Cloud in Suspension Midland…
  41. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 41
    Regional Cross Section D-D 13 horizontal play intervals identified (so far) Successful Horizontal Wells in the Play 10 intervals have been tested successfully Future Horizontal Play 3 additional intervals remain to be tested North…
  42. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 42
    Midland Basin: Stacked Play Potential Midland Basin Delta log R (excess electrical resistance) Clear Fork Red intervals indicate hydrocarbons Petrophysical analysis indicates significantly more oil in place U. Spraberry M.…
  43. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 43
    Spraberry/Wolfcamp Rig Count Counties: Andrews, Borden, Crockett, Dawson, Ector, Gaines, Glasscock, Howard, Irion, Martin, Midland, Mitchell, Reagan, Schleicher, Scurry, Sterling, Tom Green and Upton 350 53% Vertical Rigs 96%…
  44. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 44
    Production Growth Profiles For 3 Largest U.S. Oil Shale Plays 10,000,000 Includes Horizontal Wells Only Eagle Ford 200 Horizontal Rigs (down from 218 rigs in early 2013) 1,000,000 Gross Production (BOEPD) Bakken 175 Horizontal…
  45. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 45
    Spraberry/Wolfcamp Production History Includes Vertical and Horizontal Wells Spraberry/Wolfcamp production has increased 550,000 BOEPD since 2009 Monthly Production From 2009 to 2012, production growth primarily…
  46. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 46
    Drilling Results Confirming Pioneers Midland Basin Sweet Spot PXD Wolfcamp B Prospectivity Map (Early 2013) 2014 ITG Research Report Wolfcamp (All Zones) Test Rates Higher Tier 1 Tier 2 Pioneer Land Pioneer Wolfcamp B wells…
  47. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 47
    Crude Pipeline Capacity to Gulf Coast Permian Basin Crude Takeaway Capacity Operator Origin Destination Name Capacity Time Frame Plains Permian Cushing Basin 450,000 Cushing Oxy Permian Cushing Centurion 75,000 Sunoco Permian GC…
  48. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 48
    Growing Midstream Infrastructure to Support Production Growth Gas Processing Pipeline NGL Takeaway Atlas System to Mont Belvieu Current capacity: 655 MMCFD1 Chaparral & West Texas o Includes new Edward plant Pipelines online Q3…
  49. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 49
    PXDs Vertical Integration Reduces Costs and Enhances Execution Spraberry/Wolfcamp1 Eagle Ford Shale 6 horizontal frac fleets (250,000 HP total) 2 frac fleets (100,000 HP total) 4 coiled tubing units 2 coiled tubing units Well…
  50. Bank of America 2014 Global Energy Conference – Pioneer Natural Resources Co. – slide 50
    Certain Reserve Information Cautionary Note to U.S. Investors --The SEC prohibits oil and gas companies, in their filings with the SEC, from disclosing estimates of oil or gas resources other than reserves, as that term is defined by the…

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