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Raymond James Energy Conference – Ultra Petroleum Corp.

Ultra Petroleum Corp. · Mar 5, 2014 · 41 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. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 1
    Ultra Petroleum Corp. Michael D. Watford Chairman, President and CEO Raymond James Energy Conference March 5, 2014 Ultra Petroleum Corp. is an independent energy company engaged in domestic natural gas and crude oil exploration,…
  2. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 2
    The Ultra Petroleum Story: History 2001 - 2011 2012 2013 Focused on Profitable Growth Disciplined Capital Allocation Rebalancing for the Future Production growth: 1,911% Reduce capital investments Allocate project capital 20% 1P…
  3. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 3
    The Ultra Petroleum Story: Future 2014 Back to the Profitable Growth Plan 40% EBITDA growth Tripling oil production Invest within cash flow Grow reserves and production Expand margins Increase capital efficiency Ultra…
  4. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 4
    2013 Accomplishments Grew PV-10 value 83% to 4.1bn and proved reserves 18% to 3.6 Tcfe Reserve replacement ratio 307% and F&D costs of 0.53/Mcfe Executed 376MM capital investment program (excluding Uinta acquisition) generating…
  5. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 5
    2013 Proved Reserves Sensitivities Net PUD PV-10 Rem. Capital MM Bcfe MM YE13 Proved Reserves 3.51/Mcf 4,132 3,614 1,758 Sensitivity 1: YE13 Proved 4.50/Mcf 5,700 3,716 1,781 Sensitivity 2: YE13 Proved 4.50/Mcf & Increased Capital…
  6. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 6
    Strong Reserve Base Wyoming Pennsylvania Utah Total Lance Marcellus Uinta Reserves 9.6 Tcfe 9.1 Tcfe 91 MMBO 19.3Tcfe 2,600 future 2,000 future 550 future net 5,150 future net wells net wells wells net wells 10,500MM 14,900MM 800MM…
  7. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 7
    Long-Life, Low-Cost, Lance Tight Gas Pinedale Field 81,800 gross (47,600 net) 2,200 wells / 1.5 Bcfd UPL WI Wells in Red Field OGIP = 58.7 Tcf YE 2013 Total = 1,958 Recoverable = 38.2 Tcf HBP Status: 100% Jonah Field 2,200…
  8. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 8
    Pinedales Profitable Well Economics 250% 200% Robust Reinvestment Opportunities Reserve Size (Bcfe) 150% 4.0 5.0 6.0 7.0 Well Cost (/MM) IRR 4.0 42% 68% 102% 145% 100% 3.8 47% 77% 115% 164% 50% 3.6 53% 88% 130%…
  9. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 9
    Improving Operating Efficiencies 70 Pinedale Field 60 Spud to TD 50 Reduced by 40 67% Spud to TD (Days) 30 20 10 0 2006 2007 2008 2009 2010 2011 2012 2013 80 70 Pinedale Field RR-RR 60 Reduced by 71% Rig Release to…
  10. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 10
    Leads to Further Cost Reductions 8.0 Pinedale Field 7.0 6.0 5.0 Total Well Cost 4.0 (MM) 3.0 2.0 1.0 - 2006 2007 2008 2009 2010 2011 2012 2013 Ultra Petroleum Corp. NYSE: UPL 10
  11. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 11
    Extensive Future Wyoming Development
  12. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 12
    Uinta Basin Crude Oil Opportunity Three Rivers Producing wells: 54 Current production: 7,100 BOPD 3P reserves: 91 MMBO PD reserves: 10.1 MMBO Future locations: 550 Ultra Petroleum Corp. NYSE: UPL 12
  13. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 13
    Geologically Similar to Pinedale Pinedale Three Rivers Type Section Type Section Pinedale Three Rivers Reservoir Top (MD): 10,500 4,900 10,100 4,600 Reservoir Base (MD): 13,300 7,000 Upper Green River Average Porosity: 6% 7%…
  14. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 14
    Profitable Well Economics Single Well Returns 380 MBO 345 MBO 160 MBO 100 MBO 80/bbl 380% 345% 85% 40% Oil Price 100/bbl 610% 560% 140% 65% Acquisition Burdened Returns 80/bbl 60% 60% 50% 40% 100/bbl 95% 90% 85% 65% Upper Lower…
  15. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 15
    Rapid Production Growth 12,000 120 Production Growth Oil Prod 10,000 100 Oil Forecast Well Count 8,000 Future Wells 80 Producing Well Count Avg Gross Bo/d 6,000 60 4,000 40 2,000 20 - 0 2012 2012 2012 2012…
  16. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 16
    Decreasing Well Cycle Times Spud to TD 12 10 8 Spud to TD 6 (Days) 4 2 0 TR32-3333-720 TR16-11-820 TR16-12-820 TR16-31-820 TR10-42-820 TR10-32-820 TR10-31-820 RR to RR Days 16 14 12 Rig Release to 10 Rig Release 8…
  17. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 17
    Recent Well Tests Prior Oil Water Well Test Oil Cut Production Production Production Number 1: 15 months 305 bopd 29 bwpd 91% Number 2: 1 month 284 bopd 139 bwpd 67% Number 3a: 1 month 402 bopd 191 bwpd 68% Number 3b: 2 months 538 bopd…
  18. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 18
    Uinta Oil Market Infrastructure Rail Terminal Ogden Rail Terminal Refinery Highway Holly Big West Frontier Chevron Tesoro Salt Lake City Ultra Uinta Basin Provo Rail Terminal Three Rivers Field Helper Rail…
  19. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 19
    Utah Black Wax Refineries and Rail Capacities 2014 2016 Current Black Estimated Wax Refinery Capacity Wax Wax Crude Capacity (BPD) Capacity Capacity Additions Holly Frontier 31,000 10,000 14,000 34,000 Tesoro 58,000 21,000…
  20. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 20
    Marcellus Shale Natural Gas Ultra-Interest Lands Potter-Tioga Area 158,000 net acres HBP Status: 67% 215 producing horizontal wells Year-end 2013 Clinton-Lycoming Area 91,000 net acres HBP Status: 82% 133 producing horizontal…
  21. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 21
    Marcellus Well Economics 120% 100% Reinvestment Opportunities 80% Reserve Size (Bcfe) 5.0 6.0 7.0 8.0 Well Cost (/MM) IRR 60% 9.0 0% 4% 9% 14% 40% 8.0 1% 7% 13% 19% 20% 7.0 5% 11% 19% 27% 0% * Economics at 3.25/Mcf…
  22. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 22
    Geneseo Resource Assessment Geneseo Tully Hamilton Geneseo Area Ultra has dominant position 900 Geneseo Horizontal Activity UPL Participation Wells 3rd Party Wells Upper Possible Reserves 2013 = 2.2 Tcfe Marcellus Net…
  23. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 23
    Stacked Pay Potential UPL Leasehold 60% is prospective Geneseo Play for at least two plays Lake Erie Area Utica Play Area Marcellus Play Area Ultra Petroleum Corp. NYSE: UPL 23
  24. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 24
    Economic Fundamentals 2013 Reserve Cash flow F&D Full Cycle Replacement Per Mcfe Cost Returns Ratio 3.28 0.53 Per Per 411% 307% Mcfe Mcfe Ultra Petroleum Corp. NYSE: UPL 24
  25. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 25
    Industrys Low-Cost Producer 14.00 2012 All-In Costs per Mcfe 12.00 10.00 Mean - 7.31/Mcfe 8.00 All-in Costs per Mcfe 6.00 2013 Costs Per Mcfe LOE 0.38 Production Tax 0.31 4.00 Gathering Fees 0.22 Transportation 0.36 DD&A…
  26. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 26
    Strong & Stable Margins Cash Flow Margin Net Income Margin 100% 50% Cash Flow Breakeven (/Mcfe) Net Income Breakeven (/Mcfe) 90% 45% 1.20 1.18 1.15 1.35 1.62 80% 40% 2.54 2.53 2.82 3.07 2.82 70% 35% 60% 30% 50% 25% 40% 20% 70%…
  27. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 27
    Expanding Rockies Capacity 12.0 10.0 Excess takeaway capacity 4.8 Bcf/d 8.0 Average 6.0 Daily Volume (Bcf/D) 4.0 2.0 0.0 Source: Bentek Energy Actual Forecast Pipeline Capacity Ultra Petroleum Corp. NYSE:…
  28. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 28
    Shift in Basis Differentials 120% Basis Differentials as a Percentage of Henry Hub 100% 80% 60% 94% 94% 96% 96% 93% 90% 86% 40% 77% 81% 78% 77% 78% 69% 63% 60% 58% 53% 20% 0% NW Rockies Dominion South Transco…
  29. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 29
    Outlook for 2014 2014 Capital Investment Program 560MM Target drilling program 172 gross (104 net) Wyoming wells 38 5 2 63 gross (63 net) Utah wells 25 95 5 gross (2.5 net) Pennsylvania wells Production goal 243 253 Bcfe 155…
  30. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 30
    Early Look Ahead 2013A 2014E 2015E 2016E Total Operations Realized price (/Mcf) 3.57 4.00 4.15 4.45 Realized price (/Bbl) 90.98 77.00 68.00 65.00 Capex (MM) 376 560 590 625 1,775 Production (Bcfe) 232 248 270 280 Income Statement…
  31. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 31
    The Ultra Petroleum Story High Highly concentrated assets Large scale, domestic onshore, profitable operations quality assets Industry leading all-in and F&D costs Robust 5,150 future net drilling locations 26.2BN future…
  32. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 32
    Appendix Ultra Petroleum Corp. NYSE: UPL 33
  33. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 33
    Lower 48 Natural Gas Production Lower 48 Pipeline Data 70 68 66 64 62 Bcf/Day 60 58 56 54 52 Source: SpringRock Ultra Petroleum Corp. NYSE: UPL 34
  34. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 34
    Nuclear Retirements & License Reviews 2013 Actual Retirements Generation Capacity MWh Average Consumption Mcf/d San Onofre Unit 2 (CA) 1,070 218,280 San Onofre Unit 3 (CA) 1,080 220,320 Kewanee (WI) 511 104,244 Crystal River No.…
  35. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 35
    Production and Financial Guidance Q1 2014 estimated production 56 58 Bcfe Q1 2014 realized pricing Natural gas: 8 - 10% discount to NYMEX Crude oil & condensate: 18 20% discount to NYMEX Q1 2014 expense guidance Total operating…
  36. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 36
    Providing Certainty to Cash Flow Detailed Hedge Profile Total NYMEX Q1 2014 Q2 2014 Q3 2014 Q4 2014 2014 Volume (Bcf) 10.4 43.7 44.2 20.1 118.4 /Mmbtu 4.39 3.90 3.90 4.01 3.96 /Mcf 4.65 4.13 4.13 4.26 4.20 Total Crude Oil Swaps…
  37. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 37
    2013 3P Reserve Value Net 5/Mcf 4.5/Mcf Reserves PV-10 PV-10 Reserve Category (Bcfe) MM MM 1P: (Proved) 3,727 6,478 5,700 Tech PUD 3,675 3,357 2,799 Other PROB 3,397 2,467 1,917 Total Probable 7,072 5,825 4,717 2P: (Proved +…
  38. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 38
    New Ventures Strategy Objectives: Identify best geologic provinces and plays in North America Develop detailed in-house familiarity with attractive plays Identify entry points to plays of interest Focus on strategic /…
  39. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 39
    Benefits of Using Natural Gas Domestic: Greater use of this clean, abundant, madein- America energy source will create U.S. jobs and boost local economies, while advancing our national security Abundant: 2,543 Tcf of natural gas…
  40. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 40
    Innovative Employees We value the multi-faceted skills and performance our talented employees have to offer We have a unique, entrepreneurial, value-driven business culture We operate in a highly decentralized work environment…
  41. Raymond James Energy Conference – Ultra Petroleum Corp. – slide 41
    Safety and Environmental We are committed to safe operations, and maintain high standards of ethical conduct by employees, contractors and service providers We pursue our work with integrity and respect for the environment where we…

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