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Barclays CEO Energy Power Conference – Halcon Resources Corp

Halcon Resources Corp · Sep 3, 2014 · 54 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. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 1
    Barclays CEO Energy Power Conference September 3, 2014
  2. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 2
    Company Profile Significant Resource Opportunity Total Proved Reserves: (1) 119.6 MMBoe % Proved Developed: 41% Bakken/Three Forks 131,000 Net Acres % Oil: 84% 90.4 MMBoe Proved Reserves (1) % Operated: 92% Total Proved…
  3. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 3
    Consistent Production Growth Pro Forma Production Growth (MBoe/d) (1) Actual PF Production 140% Increase in Daily Production Guidance Midpoint 42.0 40.4 33.5 32.8 28.0 19.6 17.5 PF 1Q13 PF 2Q13 PF 3Q13 PF 4Q13 PF 1Q14 PF…
  4. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 4
    Significant Per Unit Cost Improvements Historical LOE (1)/Boe & G&A/Boe (2) 12.22 11.97 10.79 9.13 9.13 7.56 Q/Q Y/Y 5.86 5.86 2Q13 2Q14 1Q14 2Q14 LOE / Boe G&A / Boe Y/Y Q/Q LOE / Boe: (25%) (24%) G&A /…
  5. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 5
    Bakken / Three Forks Improvements Ongoing Highlights 2H14 Outlook Expect to spud 23 gross operated wells with 3 rigs Expect to participate in 135-140 gross non-op wells (Avg. WI 5%) Slickwater FBIR wells outperforming all wells…
  6. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 6
    Recent Downspacing Success South FBIR Sneffels Pad North Dunn County, ND HK 64.7% WI Recent Well Producing MB Well Producing TF Well Potential Infill Locations FB 35D-26-1H (MB)(1) IP: 2,088 Boe/d FB 35C-26-3H (MB) IP: 4,081…
  7. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 7
    More Recent Downspacing Success South FBIR Sneffels Pad South Dunn County, ND HK 40.5% WI Recent Sneffels Pad Completions (North & South) Recent Well Total IP (6 Wells): 19,700 Boe/d Producing MB Well Avg. IP: 3,283 Boe/d Producing…
  8. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 8
    More Recent Downspacing Success South FBIR Blanca Pad North Dunn County, ND HK 100% WI Recent Well Producing MB Well Producing TF Well Potential Infill Locations FB 19D-18-3H (MB) IP: 2,334 Boe/d FB 19C-18-4H (MB) IP: 2,515…
  9. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 9
    More Recent Downspacing Success South FBIR Blanca Pad South Dunn County, ND HK 71.3% WI Recent Blanca Pad Completions (North & South) Recent Well Total IP (4 Wells): 13,358 Boe/d Producing MB Well Avg. IP: 3,340 Boe/d Producing TF…
  10. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 10
    Field Optimization = Improved Economics Single Well Drill vs. 4 Well Batch Drill on Pad Site Average Spud to Total Depth Drilled Days FBIR (Bakken) (293) (390) 100% (143) (78) (30) (400) 35 73% 1.3 MM & 25 Days in 22 savings…
  11. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 11
    Significant Improvements Driven by Drilling & Completion Modifications Key Metrics 4Q12 1H14 % Avg. Avg. Spud to TD FBIR (Bakken) 33 17 (48%) (Days) Williams Co. (Bakken) 18 13(1) (28%) FBIR 1,572 2,583 +64% IP (Boe)…
  12. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 12
    FBIR Bakken Slickwater Wells Outperforming 250,000 225,000 200,000 175,000 Cumulative Oil Production (Bbl) 150,000 125,000 39% EUR 100,000 Uplift 75,000 50,000 25,000 Producing Days 0 - 20 40 60 80…
  13. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 13
    Williams Co. Bakken Slickwater Wells Outperforming 120,000 110,000 100,000 90,000 Cumulative Oil Production (Bbl) 80,000 70,000 43% EUR 60,000 Uplift 50,000 40,000 30,000 20,000 10,000 Producing Days…
  14. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 14
    El Halcn Geologic Setting Eagle Ford Shale - 100-300 organic rich shale target - 6,500-10,500 depth range - 7-10% GRI measured porosity - 2-4% TOC by weight - Pressure gradient: 0.55-0.65 psi/ft HK Lease Area Play…
  15. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 15
    El Halcn Eagle Ford Shale Again Highlights 101,000 net acres leased target achieved Acreage in SWEET SPOT of play 800 - 1,000+ future locations to drill depending on spacing assumptions 2H14 Outlook Expect to spud 22 gross…
  16. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 16
    El Halcn (East TX Eagle Ford Shale) Isopach HK Acreage Located in SWEET SPOT of Play 18
  17. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 17
    El Halcn Cross Section Offset to HK Reveille 1H IP: 1,066 Boe/d IP: 1,203 Boe/d HK Reveille 1H IP: 1,416 Boe/d IP: 1,054 Boe/d 19
  18. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 18
    Entire El Halcn Acreage Position De-Risked Sabalo Exploration Koontz Heirs 1H IP: 939 Boe/d Halcon Reveille 1H IP: 1,416 Boe/d Halcon Javelina 1H IP: 1,171 Boe/d Halcon Keystone 1H IP: 975 Boe/d Halcon Wombat 2H IP: 839 Boe/d…
  19. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 19
    Tremendous Success To-Date in El Halcn Additional Upside Potential to Unlock Activity has quickly accelerated since HKs entry ongoing improvements will continue to unlock into El Halcn in 2013 value in 2015+ 1 Shift from delineation…
  20. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 20
    2014 El Halcn Well Performance 100,000 75,000 Cumulative Production, Boe 50,000 25,000 0 0 50 100 150 Production Days Average 452 Mboe Type Curve 22 Note: Wells spaced a minimum of 750 feet apart and completed…
  21. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 21
    Reduction in Completed Well Costs Expected El Halcn Lease Capture vs. Development Plan Cost Savings Current (350) Land/Title (300) Initial pooled unit wells incur the majority of expense for title Completed Well Cost ( in 000s)…
  22. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 22
    TMS Geologic Setting El Halcn Closest Comp to TMS HK Lease Area Play Outline - Stratigraphic equivalent to Eagle Ford Shale play - 140-190 organic rich shale target - 11,500-14,500 depth range - 4.5-5.5% total porosity -…
  23. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 23
    Tuscaloosa Marine Shale (TMS) New Core Play Established - 316,000 Net Acre Position Emerging Shale Play with Significant Upside Potential Black oil reservoir in Mississippi and Louisiana (94% oil, 42 gravity) Proximity to Gulf Coast…
  24. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 24
    Eastern TMS Acreage HK Eastern TMS Acreage Position: 242,990 Net Acres 45% of HK Eastern TMS acreage located in Wilkinson Co. 5 miles HK Lease Area Other Operators Lease Area 26
  25. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 25
    TMS 2014 Activity Map HK GDP TMS Producing wells CMR 8-5H Shuckrow 10H-1 ECA IP: 950 Boe/d TMS WOC wells Drilling Pintard 28H-1 IP: 1,254 Boe/d ECA ELL: 5,300 TMS Drilling wells ELL: 5,800 Lyons 35H-1 HK TMS Drilling wells HK…
  26. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 26
    TMS Geology Lower TMS Resistivity (ILD) Response /= 4 ohmm TMS Producing wells MISSISSIPPI TMS WOC wells TMS Drilling wells HK TMS Drilling wells HK TMS Producing wells HK TMS WOC wells HK TMS Future wells Well control…
  27. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 27
    West to East Cross Section Wilkinson County, Mississippi Amoco Prod. Co. Halcn Resources W Artonish Pltn 2-8 Wagner & Brown Ventress LT SD Smith 1H Goodrich Crosby 12-1H Texaco Griffin W K 8 E Wilkinson Co., Mississippi…
  28. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 28
    HCPV (ft) Lower TMS TMS Producing wells TMS WOC wells MISSISSIPPI TMS Drilling wells HK TMS Drilling wells HK TMS Producing wells HK TMS WOC wells HK TMS Future wells Well control points TANGIPAHOA HK Lease Area 12…
  29. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 29
    OOIP in MMBO/Sec The Oil is There Lower TMS TMS Producing wells TMS WOC wells MISSISSIPPI TMS Drilling wells HK TMS Drilling wells HK TMS Producing wells HK TMS WOC wells HK TMS Future wells Well control points LOUISIANA…
  30. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 30
    TMS Performance Road Map Drilling Days to TD being reduced Continue to Better defined drilling targets improve Improved geosteering controls increased rate of penetration (ROP) performance Generating higher stimulated rock…
  31. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 31
    TMS Horizontal Wells WEYERHAUESER PILOT 0 2 0. 02 CROSBY PILOT 0 .2 02 2. 0 2 4 2 2 04 2 04 0 1 er 14H- Richland Sand Gauthi Lower Target Zone Horseshoe Hill 11-22H-1 Other TMS Horizontal Wells Fassman 9H-1 Black…
  32. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 32
    Strong Correlation Between Stimulated Rock Volume and Production 70,000 R = 0.7927 60,000 HK Type Curve Production (605 MBoe) 50,000 First 90 Days of Oil Production, BO 40,000 HK Type Curve Completion Design…
  33. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 33
    IP / 1,000 Lateral Supports HK Type Curve 300 ECA Lyons 35H-1 250 Peak 24 Hour Rate (BOEPD) Per 1,000' of Lateral HK Black Stone 4H-2 ECA Pintard 28H-1 200 ECA Mathis 29-32H-1 HK Horseshoe ECA Lewis 7-18H-1 Hill 11-22H-1…
  34. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 34
    TMS Infrastructure Opportunity Port of Natchez Oil Oil & Gas Gathering Gas Processing Terminal System HFS planning to develop a HFS plans to support TMS by HFS plans to install a processing scalable crude oil handling building a…
  35. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 35
    Financial Highlights 1 Maintain announced D&C budget & direct capital to highest return assets 2 Focus on liquidity Expect borrowing base to continue to increase as production and reserves grow Continue to monetize non-core…
  36. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 36
    No Near-term Debt Maturities Debt Maturity Schedule Senior 1,400 Notes Senior 8.875% Notes 1,200 Aggregate Principal Amount 9.75% 1,000 (MM) 800 600 Senior Senior Notes 400 Convertible Notes (1) 9.25% 200…
  37. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 37
    Hedging Program as of 8.22.14 Designed to support capital program and protect cash flow Target 80% of expected production over the next 18-24 months Average Floor Price: 89 in 2014; 87 in 2015 Hedged Oil Production (Bo/d) (1) Hedge…
  38. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 38
    Ample Liquidity to Fund Capital Program Capitalization ( in Millions) HK 6.30.2014 Ca s h a nd Ca s h Equi va l ents 177.3 Revol vi ng Credi t Fa ci l i ty 259.0 8.000% Seni or Convertibl e Notes due 2017 263.5 9.750% Seni or…
  39. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 39
    Appendix
  40. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 40
    2014 Operating and Financial Guidance Summary 3Q14E 2014E Production (Boe/d) Total Low 41,000 40,000 High 43,000 42,000 % Oil 85% % NGLs 5% % Gas 10% Operating Costs and Expenses (/Boe) Lease Operating & Workover Low 8.00 High…
  41. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 41
    2014 D&C Capex by Area 1.1 Billion (1) 10% Includes Apollo TMS Partnership Financing TMS 40% El Halcn Williston Basin 50% 2014 43 Note: D&C budget subject to revision; Excludes capital costs associated with…
  42. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 42
    Derivative Detail as of 8.22.14 Oil Hedge Summary 6 Mos 2014 FY 2015 FY 2016 Volume Ceiling / Floor Volume Ceiling / Floor Volume Ceiling / Floor (Bbls) Swap Price (1) Purchased (1) Floor Sold (1) (Bbls) Swap Price (1) Purchased (1)…
  43. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 43
    Oil Hedging Details as of 8.22.14 The following table details the expected impact to pretax income (in millions, except prices) from the settlement of our derivative contracts at various NYMEX oil prices Oil Prices (/Bbl) - in MM…
  44. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 44
    FBIR 801 MBoe Type Curve MB/TFS EUR Increases by 39% Investment Sensitivity to Completed Well Cost (1) Type Curve Details 120% 12.0 IRR PV-10 Oil (MBbl) 687 Gross EUR 100% 10.0 80% 8.0 Gas (MMcf) 687 PV-10 ( MM) IRR…
  45. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 45
    Fort Berthold (FBIR) Logs North FBIR Central FBIR South FBIR Upper Bakken Shale Middle Bakken Lower Bakken Shale Three Forks 1 Three Forks 2 47
  46. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 46
    Williams County 477 MBoe Type Curve EUR Increases by 43% Investment Sensitivity to Completed Well Cost (1) Type Curve Details 50% 5.0 IRR PV-10 Oil (MBbl) 415 Gross EUR 40% 4.0 Gas (MMcf) 373 PV-10 ( MM) 30% 3.0 IRR…
  47. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 47
    El Halcn 452 MBoe Type Curve EUR Increases by 22% Investment Sensitivity to Completed Well Cost (1) Type Curve Details 60% 6.0 IRR PV-10 Oil (MBbl) 420 Gross EUR 50% 5.0 40% 4.0 Gas (MMcf) 189 PV-10 ( MM) IRR %…
  48. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 48
    Eagle Ford Shale Log and Core Halcon Resources Red Stag 1H Brazos County, Texas Black Organic Rich Shale XRD Mineralogy Austin Chalk by % volume Upper Reservoir Kerogen, 3.9 Other, 6.6 Dolomite, Frac Barrier 2 Quartz,…
  49. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 49
    TMS 605 Mboe Type Curve Investment Sensitivity to Completed Well Cost (1) Type Curve Details IRR PV-10 Oil (MBbl) 566 Gross EUR 80% 7.0 60% 6.0 Gas (MMcf) 229 PV-10 ( MM) IRR % 40% 5.0 Total (MBoe) 605 Oil (% of…
  50. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 50
    TMS 792 MBoe Type Curve Investment Sensitivity to Completed Well Cost (1) Type Curve Details IRR PV-10 Oil (MBbl) 742 Gross EUR 120% 11.0 100% 10.0 Gas (MMcf) 300 PV-10 ( MM) IRR % Total (MBoe) 792 80% 9.0 Oil…
  51. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 51
    -100 400 0.2 20 0.6 0 160 40 T2N R1W S12 ft) Depth(ft) 0 -20 GOODRICH CROSBY 12-1H TMS Log and Core 1 GDP 12,210 Crosby Minerals 12-1H Wilkinson Co., Mississippi AT90 0 0.2 20 PASSEY METHOD 80 Black Organic Rich Shale…
  52. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 52
    Oil & Gas Marketing Avg. NYMEX 2014 Marketing Highlights 2Q14 HK Oil Differentials by Area (1) Oil Price 103.07 103% Williston Basin 99% 99% Oil Marketing 93% Expect 90%+ of production to be connected to 88% pipeline by…
  53. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 53
    Halcn Ownership (in thousands) Basic Dilutive Securities Fully Diluted Net Diluted (6) Owner Shares Percent Conv. Debt (1) Conv. Preferred (2) Warrants (3) RSAs (4) PSUs (5) Options Shares Percent Shares Percent (7) HALRES LLC - -…
  54. Barclays CEO Energy Power Conference – Halcon Resources Corp – slide 54
    Contact: Scott M. Zuehlke, VP Investor Relations 1000 Louisiana St., Suite 6700 Houston, TX 77002 832-538-0314 szuehlkehalconresources.com www.halconresources.com

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