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Company Presentation Q2 2014 – Consol Energy Inc.

Consol Energy Inc. · Jul 29, 2014 · 183 slides

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Slides

  1. Company Presentation Q2 2014 – Consol Energy Inc. – slide 1
    Company Presentation Q2 2014
  2. Company Presentation Q2 2014 – Consol Energy Inc. – slide 2
    Agenda Company Overview E&P Division Marcellus Shale Utica Shale Upper Devonian Stacked Pay Potential Other Gas Reserves and Resources Gas Marketing Coal Division Monetization of Non-Core Assets Financial Overview…
  3. Company Presentation Q2 2014 – Consol Energy Inc. – slide 3
    Company Overview Transformative Journey Ten years ago traditional coal producer, the largest underground producer in the world Eight years ago created CNX Gas Four years ago acquired Dominion Resources Appalachian E&P business…
  4. Company Presentation Q2 2014 – Consol Energy Inc. – slide 4
    Company Overview CONSOL Energy Core Values Unwavering focus on Core Values of safety, compliance, and continuous improvement 6
  5. Company Presentation Q2 2014 – Consol Energy Inc. – slide 5
    Company Overview Strategic Evolution CONSOLs E&P Division represents the greatest portion of EBITDA Natural gas is the de facto choice for new MWh demand as well as for backfilling market share ceded by nuclear and coal, which is a…
  6. Company Presentation Q2 2014 – Consol Energy Inc. – slide 6
    Company Overview Oil and Gas Acreage Ownership CONSOL % of Legacy Ownership by State and Horizon State Marcellus Utica Burkett Rhinestreet PA 50% 100% 50% 100% WV 50% 100% 50% 100% OH 100% 50% 100% 100% Note: CONSOLs…
  7. Company Presentation Q2 2014 – Consol Energy Inc. – slide 7
    Company Overview Summary We have tier-one assets across our entire Appalachian-centric portfolio, in both E&P and Coal: - Sweet spots in both the wet and dry portions of the Marcellus and Utica shales - Multiple stack pay…
  8. Company Presentation Q2 2014 – Consol Energy Inc. – slide 8
    Company Overview Second Quarter 2014 Results Net loss for the second quarter was (25) million - Includes four pre-tax items related to recent transactions completed by the company: 74.3 million expense related to early extinguishment…
  9. Company Presentation Q2 2014 – Consol Energy Inc. – slide 9
    Company Overview E&P Division: Summary Q-to-Q Q-to-Q E&P Division 2Q2014 2Q2013 Change 2Q2014 1Q2014 Change Average Sales Price ( / Mcfe) 4.44 4.46 (0.02) 4.44 5.52 (1.08) Average Costs ( / Mcfe) 3.44 3.77 (0.33) 3.44 3.63 (0.19)…
  10. Company Presentation Q2 2014 – Consol Energy Inc. – slide 10
    Company Overview Coal Division: Summary Q-to-Q Q-to-Q Coal Division 2Q2014 2Q2013 Change 2Q2014 1Q2014 Change Average Sales Price ( / ton) 62.43 69.93 (7.50) 62.43 66.20 (3.77) Average Costs ( / ton) 47.63 51.24 (3.61) 47.63 45.15…
  11. Company Presentation Q2 2014 – Consol Energy Inc. – slide 11
    Company Overview CONSOL Cost Metrics Gas: Operating Costs per Mcfe 6 5 / Mcfe 4 3 2 1Q2012 2Q2012 3Q2012 4Q2012 1Q2013 2Q2013 3Q2013 4Q2013 1Q2014 2Q2014 CBM Marcellus Shallow Oil & Gas Coal: Cost per Ton Sold 86 76…
  12. Company Presentation Q2 2014 – Consol Energy Inc. – slide 12
    Company Overview Strong Liquidity Position of 1.9 Billion Cash on hand of 147 million Accounts receivable securitization and revolving credit facility of 1.8 billion Amount/ Amount Letters Amount June 30, 2014 ( in million) Capacity…
  13. Company Presentation Q2 2014 – Consol Energy Inc. – slide 13
    Company Overview CONSOL Energy: Net (Decrease)/Increase in Cash Goal is to maintain our strong liquidity position Cash Flow Summary Q-to-Q Q-to-Q ( in millions) 2Q2014 2Q2013 Change 2Q2014 1Q2014 Change Net Cash Provided by…
  14. Company Presentation Q2 2014 – Consol Energy Inc. – slide 14
    Company Overview Q1 2014 to Q2 2014 Cash Reconciliation 600 221 (368) 500 ( in millions) 400 314 300 8 (10) (14) (4) 200 147 100 - (1) Cash Balance Net Cash Capital Proceeds Proceeds Dividends Other Cash Balance as of Q1…
  15. Company Presentation Q2 2014 – Consol Energy Inc. – slide 15
    Company Overview Marketing 3Q14 and 2014 Forecasts 2014 Coal Sales Facts and Goals Contracted tons for 2014: 98% Sales Tons by Product Year 2014 - Priced: 96% 5% Approximately 78% of the Low-Vol & High-Vol met 11% coal tons are…
  16. Company Presentation Q2 2014 – Consol Energy Inc. – slide 16
    Company Overview Our Domestic Coal Market Remains Solid PJM Coal Inventory Trailing 12 Months 5 Year Average 30 25 20 Tons (MM) 15 10 5 - May 13 Aug 13 Nov 13 Feb 14 Source: EIA, PIRA, and CONSOL analysis. 18
  17. Company Presentation Q2 2014 – Consol Energy Inc. – slide 17
    E&P Division 19
  18. Company Presentation Q2 2014 – Consol Energy Inc. – slide 18
    E&P Division Tim Dugan, COOE&P: Background and Vision Over 30 years of experience across the nations major natural gas fields including: - Marcellus, Utica, Upper Devonian, Barnett, and Haynesville Most recently served as Vice…
  19. Company Presentation Q2 2014 – Consol Energy Inc. – slide 19
    E&P Division Continuous Improvement in the Marcellus Shale Average Completed Lateral Length Average Max IP and Average 30-Day Rate 9,000 14,000 8,000 8,000 11,555 12,000 7,000 10,000 9,297 6,000 5,483 8,298 5,137 8,000…
  20. Company Presentation Q2 2014 – Consol Energy Inc. – slide 20
    E&P Division CONSOL Energy is a Low Cost Leader 2011-2013 All Sources Reserve Replacement: 3-Year Average vs. E&P Peers 2,000% 1,500% Average: 316% 1,000% 515% 500% 0% CONSOL Energy 2011-2013 All Sources F&D Cost: 3-Year…
  21. Company Presentation Q2 2014 – Consol Energy Inc. – slide 21
    E&P Division Large and Growing E&P Reserves YE 2013 Proved Reserves Proved Reserves Growth 6,000 172 105 (172) 1,633 5,731 6,000 5,731 5,000 5,000 3,993 4,000 3,993 4,000 3,732 3,480 3,000 44% increase in proved…
  22. Company Presentation Q2 2014 – Consol Energy Inc. – slide 22
    E&P Division Resource and Opportunity Rich Portfolio Proved Estimated Potential Locations (Gross) Tcfe Proved(2) Unproven Total Marcellus Shale 3.4 1,414 8,024 9,438 Utica Shale(1) 0.1 45 3,030 3,075 Upper Devonian 0.0 5…
  23. Company Presentation Q2 2014 – Consol Energy Inc. – slide 23
    E&P Division Summary Marcellus Shale Utica Shale Future Development / Potential Growth engine over next 3-5 Growing portion of Stacked pay potential years of development production mix over next 3 Pittsburgh Airport years Over 60%…
  24. Company Presentation Q2 2014 – Consol Energy Inc. – slide 24
    E&P Division 2014E Drill Schedule and Activity Overview Marcellus Shale Utica Shale Upper Devonian PA/W North South Ohio Ohio SWPA CPA WV Ohio(1) Total V Total SWPA WV Total Wet Wet Wet Dry Dry Drilled 46 12 25 1 68 30 182 32 1…
  25. Company Presentation Q2 2014 – Consol Energy Inc. – slide 25
    E&P Division Gas Division Production Growth Gas Production 400 +30% 300 +30% 225-235 Bcfe 200 172.4 153.5 156.3 127.9 +60% 94.4 100 76.6 56.1 58.2 +44% 44.5 48.6 48.4 +87% 0 2003 2004 2005 2006 2007 2008…
  26. Company Presentation Q2 2014 – Consol Energy Inc. – slide 26
    E&P Division 2014E E&P Capex: 1,110 million Land capex Other E&P Capex Coal 2014E E&P Capex Potential Marcellus JV Carry 26% 1,200 1,110 953 1,000 in millions 800 600 528 E&P 400 74% 200 0 2012 2013 2014E E&P…
  27. Company Presentation Q2 2014 – Consol Energy Inc. – slide 27
    E&P Division 2014E E&P Capex: 1,110 million Marcellus Wet 410 million Marcellus Dry 415 million Utica Wet 105 million Wet Dry Oil Wet Dry Utica Dry 10 million Source: Company filings. 29
  28. Company Presentation Q2 2014 – Consol Energy Inc. – slide 28
    E&P Division Joint Ventures Overview Summary of JV Carry Eligible Capital Description Marcellus / Noble Utica / Hess Ownership 50/50 50/50 Net acreage 345,151(1) 68,488(2) Zones PA and WV Marcellus, Burkett to Onondaga OH Utica…
  29. Company Presentation Q2 2014 – Consol Energy Inc. – slide 29
    E&P Division Declining E&P Unit Costs Driving Down Weighted Average Cost: Consolidated Cost per Mcfe Property & Other Taxes Direct Admin, Selling & Other Total operating cost per Mcfe expected to decline LOE Gathering and…
  30. Company Presentation Q2 2014 – Consol Energy Inc. – slide 30
    E&P Division Asset Teams: Overview Ensuring locations are drill-ready Build teams and alignment 4 Teams: Northern Marcellus: Pennsylvania Deliver on IRR and PVR Southern Marcellus: West Virginia Focused on capital efficiency Utica…
  31. Company Presentation Q2 2014 – Consol Energy Inc. – slide 31
    E&P Division Enhanced Production Techniques: Pure Upside Eliminating chokes and bottlenecks Pad production increases around 34% EUR could increase as much as 29% Kuhns 3B Actual Gas Production vs Projected Production w/o Annular…
  32. Company Presentation Q2 2014 – Consol Energy Inc. – slide 32
    E&P Division Marcellus Recompletions GH15 recomplete added production and reserves Original EUR: 3.9 Bcfe Recomplete EUR: 6.0 Bcfe Incremental EUR: 2.1 Bcfe 6 additional recompletes planned for 2014 GH 15 Production History and…
  33. Company Presentation Q2 2014 – Consol Energy Inc. – slide 33
    E&P Division Marcellus Completions: Line Pressure Reduction 120,000 1,400 10 MMcfd Increase 1,200 100,000 1,000 80,000 PSIG Mcfd 800 60,000 600 40,000 400 20,000 200 NV41 Pad N NV Field N NV Field…
  34. Company Presentation Q2 2014 – Consol Energy Inc. – slide 34
    Marcellus Shale 36
  35. Company Presentation Q2 2014 – Consol Energy Inc. – slide 35
    Marcellus Shale Overview 436,000 CONSOL net acres 88% NRI 87% HBP 21.9 Tcfe 3P Over 8,900 gross potential wells(1) 2014E drilled wells: 182(2) 87% Marcellus production growth expected in 2014E Liquids expected to grow from…
  36. Company Presentation Q2 2014 – Consol Energy Inc. – slide 36
    Marcellus Shale New Project Areas: Marcellus EUR/Ft 38
  37. Company Presentation Q2 2014 – Consol Energy Inc. – slide 37
    Marcellus Shale Growth Runway and Depth of Inventory Marcellus Shale Upside Potential Total Prospective Marcellus Acreage 790,000 - Acres within JV 690,000 - Acres outside JV 100% CONSOL 100,000 Acreage per well (assumed 750 ft…
  38. Company Presentation Q2 2014 – Consol Energy Inc. – slide 38
    Marcellus Shale Continuous Improvement Average Daily Well Production Grouped by TIL Year Focus on prioritization and optimization of assets Improved drilling and completions result in 10,000 better wells 2008-2011 Actuals…
  39. Company Presentation Q2 2014 – Consol Energy Inc. – slide 39
    Marcellus Shale Actual Well Costs vs. Lateral Length 2012 and 2013 Combined Well Costs RCS/SSL Well Costs 12,000,000 12,000,000 Actual RCS/SSL well costs 10,000,000 10,000,000 8,000,000 8,000,000 6,000,000 6,000,000…
  40. Company Presentation Q2 2014 – Consol Energy Inc. – slide 40
    Marcellus Shale Increasing Economics By Drilling Longer Laterals IRR w/Carry IRR w/Eff IRR Hist. CONSOL has consistently 160% 154% increased drilled lateral 145% lengths each year 136% 2011: 3,853 ft 126% 115% 2012: 5,514 ft 120%…
  41. Company Presentation Q2 2014 – Consol Energy Inc. – slide 41
    Marcellus Shale: Drilling 43
  42. Company Presentation Q2 2014 – Consol Energy Inc. – slide 42
    Marcellus Shale: Drilling CONSOL-Operated Summary Drilling Summary 2011 2012 2013 YTD 2014 Wells TDd 78 64 46 40 Lateral ft 300,466 328,428 366,615 301,367 Total MD ft 92,264 794,098 730,316 617,138 Average Lateral ft 3,853 5,514…
  43. Company Presentation Q2 2014 – Consol Energy Inc. – slide 43
    Marcellus Shale: Drilling Cost Efficiencies and Improvements Air Directional: Expect a two-day reduction in horizontal cycle times Technological Advances: One-run RSS tools; drilling optimization, and evaluating 7-7/8 production…
  44. Company Presentation Q2 2014 – Consol Energy Inc. – slide 44
    Marcellus Shale: Drilling Air Directional NV34B Without Air Directional Air Directional Top Hole Horizontal Comparison NV58E NV34B Air Directional Work Yes No Kick-Off Point ft 6,700 5,600 o o Starting Inclination 24 0 Total MD…
  45. Company Presentation Q2 2014 – Consol Energy Inc. – slide 45
    Marcellus Shale: Completions 47
  46. Company Presentation Q2 2014 – Consol Energy Inc. – slide 46
    Marcellus Shale: Completions CONSOL-Operated Summary Completions Summary 2011 2012 2013 YTD 2014 Wells Completed 57 51 59 29 Lateral Completed ft 188,800 270,256 333,895 223,825 Total Stages 684 940 1,527 1,474 Average Stage/Well…
  47. Company Presentation Q2 2014 – Consol Energy Inc. – slide 47
    Marcellus Shale: Completions Cost Efficiencies and Improvements Completions Pricing Reduction: Renegotiating contracts Efficiency Increases: Increases the number of stages per day Stimulation Design Optimization: Pump rates, sand…
  48. Company Presentation Q2 2014 – Consol Energy Inc. – slide 48
    Marcellus Shale: Completions Cost Efficiencies and Improvements Entire pad average stages per day Increasing from 4 to 8 stages per day equates to capital savings of 430,000 and reduces cycle time by 7 days Capital Savings vs.…
  49. Company Presentation Q2 2014 – Consol Energy Inc. – slide 49
    Marcellus Shale: Completions RCS/SSL Overview 30 30 30 30 30 30 30 30 30 60 60 60 60 Cluster Spacing reduced from 60 to 30 Stage Length Standard 300 Stage SSL 150 SSL 150 reduced from 300 to 150 Length Stage Stage RCS/SSL…
  50. Company Presentation Q2 2014 – Consol Energy Inc. – slide 50
    Marcellus Shale: Completions RCS/SSL Activity Overview 12 RCS/SSL wells to date 29 RCS/SSL wells to date 12 RCS/SSL wells to date Producing Pads Note: Townships are shown in yellow where CONSOL holds 3,000 or more…
  51. Company Presentation Q2 2014 – Consol Energy Inc. – slide 51
    Marcellus Shale: Sub-Regions 53
  52. Company Presentation Q2 2014 – Consol Energy Inc. – slide 52
    Marcellus Shale: Sub-Regions Summary Marcellus Shale North South SWPA CPA WV Ohio(1) Total Wet Wet Net Acres 45,000 110,000 105,000 11,000 60,000 105,000 436,000 Approximate Gross 700 2,000 2,300 100 1,600 2,200 8,900…
  53. Company Presentation Q2 2014 – Consol Energy Inc. – slide 53
    Marcellus Shale: Southwest PA Southwest PA Overview 45,000 CONSOL net acres NV56 Pad Over 700 gross locations(1) 2 Wells 7,171 Avg Lateral Length per well 9,365 Mcfe Avg 30-day IP per well 138 wells online, as of 7/1/2014 19…
  54. Company Presentation Q2 2014 – Consol Energy Inc. – slide 54
    Marcellus Shale: Southwest PA Southwest PA 5,000 ft Type Curve and Economics 1,000 100 MMcfe/Mo 10 1 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 160% 159% 131% Southwest PA Assumptions Type Curve 2014E…
  55. Company Presentation Q2 2014 – Consol Energy Inc. – slide 55
    Marcellus Shale: Southwest PA Southwest PA Production vs. 5,000 ft Type Curve 8.5 Bcfe Type Curve 7.2 Bcfe Type Curve Projecting 18% improvement in EURs utilizing RCS/SSL 57
  56. Company Presentation Q2 2014 – Consol Energy Inc. – slide 56
    Marcellus Shale: Southwest PA Southwest PA Production vs. 5,000 ft Type Curve 11.6 Bcfe Type Curve 9.6 Bcfe Type Curve We expect to drill 16, 53, and 19 horizontal wells in 2014, 2015, and 2016, respectively 58
  57. Company Presentation Q2 2014 – Consol Energy Inc. – slide 57
    Marcellus Shale: Northern WV Dry Northern WV Overview 105,000 CONSOL net acres Over 2,300 gross PHL13 Pad locations(1) ANDERSON (PDC Mountaineer) 6 Wells 3 Wells 7,949 Avg Lateral Length per well 25 wells online, as of 4,859 Avg…
  58. Company Presentation Q2 2014 – Consol Energy Inc. – slide 58
    Marcellus Shale: Northern WV Dry Northern WV 5,000 ft Type Curve and Economics 1,000 100 MMcfe/Mo 10 1 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 100% Northern WV Dry 85% Assumptions Type Curve 2014E…
  59. Company Presentation Q2 2014 – Consol Energy Inc. – slide 59
    Marcellus Shale: Northern WV Dry Northern WV Production vs. 5,000 ft Type Curve 7.9 Bcfe Type Curve 6.6 Bcfe Type Curve Early constraints masking results but expect improved production with RCS/SSL 61
  60. Company Presentation Q2 2014 – Consol Energy Inc. – slide 60
    Marcellus Shale: Northern WV Dry Northern WV - Dominion Transmission Storage Field Antero Activity(1) Within 2 miles of DTI northern border Average EURs: 1.7 Bcfe/1,000 lateral utilizing RCS/SSL AUD3 Pad 1 Well 8,691 Avg Lateral…
  61. Company Presentation Q2 2014 – Consol Energy Inc. – slide 61
    Marcellus Shale: Central PA Central PA Overview 110,000 CONSOL net acres Over 2,000 gross GAUT4 Pad locations(1) 4 Wells 7,941 Avg Lateral Length per well 51 wells online, as of 6,619 Mcfe Avg 30-day IP per well 759 MMcf/well 1st…
  62. Company Presentation Q2 2014 – Consol Energy Inc. – slide 62
    Marcellus Shale: Central PA Central PA 5,000 ft Type Curve and Economics 1,000 100 MMcfe/Mo 10 1 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 80% 78% 63% Central PA 60% 57% Assumptions Type Curve…
  63. Company Presentation Q2 2014 – Consol Energy Inc. – slide 63
    Marcellus Shale: Central PA Central PA Production vs. 5,000 ft Type Curve 8.0 Bcfe Type Curve 6.8 Bcfe Type Curve Flowback underway on first five RCS/SSL wells 65
  64. Company Presentation Q2 2014 – Consol Energy Inc. – slide 64
    Marcellus Shale: North Wet Gas New Project Areas Pittsburgh Airport 45 planned Marcellus laterals 45 potential Upper Devonian laterals 15 planned 30 potential 45 potential Utica Shale laterals 9,000 contiguous acres have…
  65. Company Presentation Q2 2014 – Consol Energy Inc. – slide 65
    Marcellus Shale: North Wet Gas North Wet Gas Overview 60,000 CONSOL net acres Over 1,600 gross locations(1) 70 wells online, as of 7/1/2014 IMPERIAL LAND (Range 63 wells online in Resources) 2014E 4 Wells BARE WARREN (Range…
  66. Company Presentation Q2 2014 – Consol Energy Inc. – slide 66
    Marcellus Shale: North Wet Gas North Wet Gas 5,000 ft Type Curve and Economics 1,000 5 Wellhead Sold Gas 4 100 Condensate MMcf/Mo MBbl/Mo NGL 3 2 10 1 1 0 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 100%…
  67. Company Presentation Q2 2014 – Consol Energy Inc. – slide 67
    Marcellus Shale: North Wet Gas North Wet Gas Production vs. 5,000 ft Non-RCS/SSL Type Curve Increasing productivity Limited use of RCS/SSL First 12 wells of 2014 2 of 12 wells utilized RCS/SSL in 2014 2014 IP rates significantly…
  68. Company Presentation Q2 2014 – Consol Energy Inc. – slide 68
    Marcellus Shale: North Wet Gas Liquids Production Growth Price Uplift from Wet Gas Increases Value 60% to Liquids Volume Growth Over 8 per Mcf of Wellhead Gas Gas NGL Condensate /Mcf 9 8.57 5 Bbl/MMcf 0.46 condensate at 85%…
  69. Company Presentation Q2 2014 – Consol Energy Inc. – slide 69
    Marcellus Shale: South Wet Gas South Wet Gas Overview SHR1 Pad 105,000 CONSOL net 6 Wells 8,741 Avg Lateral Length per well WEESE (Triad Hunter) 3 Wells acres PEN1 Pad Completions underway 9 Wells 3,711 Avg Lateral Length per…
  70. Company Presentation Q2 2014 – Consol Energy Inc. – slide 70
    Marcellus Shale: South Wet Gas South Wet Gas 5,000 ft Type Curve and Economics 1,000 5 Wellhead Sold Gas 4 100 Condensate MMcf/Mo MBbl/Mo NGL 3 2 10 1 1 0 0 50 100 150 200 Months IRR w/Carry IRR w/Eff IRR Hist. 60%…
  71. Company Presentation Q2 2014 – Consol Energy Inc. – slide 71
    Utica Shale 73
  72. Company Presentation Q2 2014 – Consol Energy Inc. – slide 72
    Utica Shale Overview: A Leading Position in the Utica Shale 581,000 CONSOL net acres(1) Over 3,000 gross locations 20 wells online, as of 7/1/2014 43 wells online in 2014E 7,000 ft average laterals in 2014E 4-5 wells per pad…
  73. Company Presentation Q2 2014 – Consol Energy Inc. – slide 73
    Utica Shale Growth Runway and Depth of Inventory Utica Shale Upside Potential Total Prospective Utica Acreage 650,000 - Acres within JV 137,000 - Acres outside JV 100% CONSOL 513,000 Acreage per well (assumed 750 ft spacing) 86…
  74. Company Presentation Q2 2014 – Consol Energy Inc. – slide 74
    Utica Shale Utica Production Growth Production 50 40.4 40 37.8 30 Bcfe 20 13.5 10 0.8 0 2013 2014E 2015E 2016E Utica Net Production Utica shale production expected to become greater part of mix 76
  75. Company Presentation Q2 2014 – Consol Energy Inc. – slide 75
    Utica Shale: Drilling 77
  76. Company Presentation Q2 2014 – Consol Energy Inc. – slide 76
    Utica Shale: Drilling CONSOL-Operated Summary Drilling Summary 2013 YTD 2014 Wells TDd 9 9 Lateral ft 63,167 47,972 Total MD ft 137,769 121,412 Average Lateral ft 7,019 5,330 Average TMD ft 15,308 13,490 Average Drill Cost/ft…
  77. Company Presentation Q2 2014 – Consol Energy Inc. – slide 77
    Utica Shale: Drilling Cost Efficiencies and Improvements Shortened Intermediate Casing: Potential to reduce cycle times by 8 days with revised casing program; could result in reduction in cost of 900k per well Technological Advances:…
  78. Company Presentation Q2 2014 – Consol Energy Inc. – slide 78
    Utica Shale: Completions 80
  79. Company Presentation Q2 2014 – Consol Energy Inc. – slide 79
    Utica Shale: Completions CONSOL-Operated Summary Completions Summary 2012 2013 YTD 2014 Wells Completed 4 10 6 Lateral Completed ft 18,160 50,916 42,923 Total Stages 63 200 290 Average Stg/Well 16 20 48 Average Stage Cost 310k 224k…
  80. Company Presentation Q2 2014 – Consol Energy Inc. – slide 80
    Utica Shale: Completions Cost Efficiencies and Improvements Completions Pricing Reduction: Renegotiating contracts Efficiency Increases: Increases the number of stages per day Stimulation Design Optimization: Pump rates, sand…
  81. Company Presentation Q2 2014 – Consol Energy Inc. – slide 81
    Utica Shale: Sub-Regions 83
  82. Company Presentation Q2 2014 – Consol Energy Inc. – slide 82
    Utica Shale: Sub-Regions 2014E Activity Overview Utica Shale Ohio Wet Ohio Dry PA/WV Dry Total Net Acres 84,000 25,000 472,000 581,000 Approximate Gross 500 300 2,200 3,000 Locations(1) Avg EURs/1,000 ft 1.9 2.4 1.8 --…
  83. Company Presentation Q2 2014 – Consol Energy Inc. – slide 83
    Utica Shale: Ohio Wet Gas The Utica Sweet Spot Evolves GPOR - Wagner 1-28H CHK - Buell 8H IP GAS: 14,000 Mcf/d IP GAS: 9,500 Mcf/d IP OIL: 432 Bbl/d IP OIL: 1,425 Bbl/d GPOR - Shugert 1-12H 36,000 net core wet acres IP GAS: 28,500…
  84. Company Presentation Q2 2014 – Consol Energy Inc. – slide 84
    Utica Shale: Ohio Wet Gas CONSOLs Historic Core: Noble, Harrison, Belmont, Guernsey, and Jefferson Counties 84,000 CONSOL net acres 36,000 CONSOL net acres in core Type curve reflects core area Over 500 gross core area…
  85. Company Presentation Q2 2014 – Consol Energy Inc. – slide 85
    Utica Shale: Ohio Dry Gas Recent IP Rates In and Around Monroe County, OH CVX Conner well (Utica): 25.0 MMcf/d Avg 24-hr rate GPOR Irons 1-4H (Utica): 30.3 MMcf/d Avg 24-hr rate MHR 3-UH (Utica): 32.5 MMcf/d Avg 24-hr…
  86. Company Presentation Q2 2014 – Consol Energy Inc. – slide 86
    Utica Shale: Ohio Dry Gas Ohio Dry Gas Area Production vs. 5,000 ft Type Curve 25,000 CONSOL net acres 11,000 net acres in Monroe County, OH 14,000 net acres in eastern portion of Jefferson, Belmont and Harrison counties Over…
  87. Company Presentation Q2 2014 – Consol Energy Inc. – slide 87
    Utica Shale: PA/WV Dry Gas Utica PA/WV Dry Gas Area Overview REXX Cheeseman 1 IP Gas: 9,200 mcfd RRC Zahn 1 IP Oil: 0 Bbld IP Gas: 4,500 mcfd IP Oil: 0 Bbld CHK Thompson 3H CHK Hubbard 3H IP Gas: 6,400 mcfd IP Gas: 11,00 mcfd IP…
  88. Company Presentation Q2 2014 – Consol Energy Inc. – slide 88
    Utica Shale: PA/WV Dry Gas Utica PA/WV Dry Gas Production vs. 5,000 ft Type Curve 472,000 CONSOL net acres 300,000 prospective net acres in PA (80,000 net acres located within Greene and Washington counties) 172,000…
  89. Company Presentation Q2 2014 – Consol Energy Inc. – slide 89
    Upper Devonian 91
  90. Company Presentation Q2 2014 – Consol Energy Inc. – slide 90
    Upper Devonian Burkett Shale Sweet Spot CONSOL is well situated in the best part of the Burkett fairway, with an estimated 345,000 net acres of potential across the entire Upper Devonian 92
  91. Company Presentation Q2 2014 – Consol Energy Inc. – slide 91
    Upper Devonian NV39F Upper Devonian Exploration Well Drilled in Southwest PA 5 underlying Marcellus wells on pad Washington County, PA Drilled lateral length of 4,889 ft Fracd 17 stages in Burkett Shale Tested 3.0 MMcf/d, TIL…
  92. Company Presentation Q2 2014 – Consol Energy Inc. – slide 92
    Upper Devonian Upper Devonian Production vs. 5,000 ft Type Curve First Upper Devonian well demonstrating very shallow decline compared to type curve Currently producing above type curve: Forecasted EUR 9 Bcfe Planning 6+ Burkett…
  93. Company Presentation Q2 2014 – Consol Energy Inc. – slide 93
    Stacked Pay Potential 95
  94. Company Presentation Q2 2014 – Consol Energy Inc. – slide 94
    Stacked Pay Potential Appalachian Shale Acreage P a y Formation Name Wet Dry Total Net Acres Net Acres Net Acres Rhinestreet Shale Upper Cashaqua Shale Devonian 190,000 155,000 345,000 Middlesex Shale West River…
  95. Company Presentation Q2 2014 – Consol Energy Inc. – slide 95
    Stacked Pay Potential CONSOLs Shale Fairway PIT Airport Rhinestreet = 5,340 Burkett = 5,460 Marcellus = 5,690 Utica = 10,760 Monroe County/Moundsville Rhinestreet = 5,930 Burkett = 6,110 Southwest PA Marcellus = 6,190…
  96. Company Presentation Q2 2014 – Consol Energy Inc. – slide 96
    Stacked Pay Potential Gas Factory Development Stacked laterals provide economies of scale to access up to 4 pays from 1 pad 98
  97. Company Presentation Q2 2014 – Consol Energy Inc. – slide 97
    Stacked Pay Potential Southwest PA Stack Pay Potential: 9.0 Tcfe Resource Potential Potential Lateral Spacing Well CapEx EUR Liquids Resource Pay Wells Length (ft) (acre) (MM) (Bcfe) (%) (Bcfe) Burkett 235 6,400 110 7.6 9.5 - 2,226…
  98. Company Presentation Q2 2014 – Consol Energy Inc. – slide 98
    Stacked Pay Potential Pittsburgh Airport Stack Pay Potential: 1.6 Tcfe Resource Potential Potential Lateral Spacing Well CapEx EUR Liquids Resource Pay Wells Length (ft) (acre) (MM) (Bcfe) (%) (Bcfe) Upper Devonian (Burkett) 45 8,000…
  99. Company Presentation Q2 2014 – Consol Energy Inc. – slide 99
    Other Gas Reserves and Resources 101
  100. Company Presentation Q2 2014 – Consol Energy Inc. – slide 100
    Other Gas Reserves and Resources Virginia Coalbed Methane (CBM) 350,000 net acres(1) Origin of CNX Gas Associated with mining at Buchanan mine Advantageous gas marketing location for basis Over 2,700 gross locations 3,000 wells…

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