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Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp

Sanchez Energy Corp · Mar 25, 2014 · 31 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 42nd Annual Energy Conference – Sanchez Energy Corp – slide 1
    Corporate Presentation Howard Weil 42nd Annual Energy Conference
  2. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 2
    Sanchez Energy Overview Market Cap (1) 1,450 MM Enterprise Value 2,270 MM Eagle Ford Shale Net Acreage: 120,000 acres 1P Reserves: 59 MMBoe Production: 19,500+ Boe/d Significant Growth 4Q13 production grew 904% YOY Oil Weighted…
  3. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 3
    Strong Growth in Production and Proved Reserves Average Daily Net Production (Boe/d) Proved Reserve Growth (MMBoe) 70 30,000 PD PUD 60 59 23,000 - 25,000 20,000 21,000 - 50 18,000 43 20,000 58% 40 15,000 70% 30 10,607 21…
  4. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 4
    Oil Concentrated Reserves And High Cash Margins Crude oil represents 77% of reserves (88% crude oil and NGLs) Reserves by Product Mix Realized Price Vs. Unhedged Cash Margins (/Boe) (1) (2) 75.18 Taxes 3.69 LOE 8.42 Cash G&A 5.12…
  5. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 5
    Capital Expenditures Focused On Eagle Ford 2014 Capital Plan (MM) Gross % of % of Full Year Net Wells Net Wells Capital D&C Project Area Rig Count Spud Completed Capex Plan Capital Plan Marquis 3.0 35 32 270 - 285 44% 47% Palmetto…
  6. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 6
    Full Year 2014 and 1Q14 Guidance Full Year 2014 Guidance Metrics Range Production Guidance (Boe/d) Full Year 2014 Average 21,000 - 23,000 Full Year 2014 Operating Cost & Expense Guidance (/Boe) Oil & Natural Gas Production Expenses…
  7. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 7
    Eagle Ford Shale 8 2014 Sanchez Energy Corporation
  8. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 8
    The Eagle Ford Shale Core Focus Area SN Eagle Ford Position Summary Net Acres 120,000 Current Production (Boe/d) 19,500+ Gross Drilling Rigs 6 Gross Producing Wells 204 9 2014 Sanchez Energy Corporation
  9. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 9
    Cotulla Overview Wycross Alexander Ranch Cotulla Acreage & Inventory Wycross 2014 Capital Plan Other Cotulla 2014 Capital Plan Total Net Acres 42,000 2014 Capital Plan (MM) 140 - 150 2014 Capital Plan (MM) 50 - 60 Average…
  10. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 10
    Marquis & Palmetto Overview Marquis Palmetto Marquis Acreage & Inventory Marquis 2014 Capital Plan Palmetto 2014 Capital Plan Total Net Acres 69,000 2014 Capital Plan (MM) 270 - 285 2014 Capital Plan (MM) 45 - 55 Average…
  11. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 11
    Tuscaloosa Marine Shale 12 2014 Sanchez Energy Corporation
  12. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 12
    TMS Acreage Position and Activity 40,000 net acre position in the core of the TMS Contiguous blocky acreage with 3+ years of average remaining lease term SN anticipates spudding up to 4 gross (2 net) operated wells and participating in…
  13. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 13
    Operations and Financial Overview 14 2014 Sanchez Energy Corporation
  14. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 14
    Operational Focus on Efficiencies The move to pad drilling across our assets has reduced costs and increased efficiencies Multi-Well Pad Drilling Cash Operating Cost / Boe 100% 90% 45.06 80% 75% 4.78 36.74 9.37 60% 4.53 7.26…
  15. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 15
    Drilling Efficiency Example: La Salle County Average Feet / Day (Spud to TD) 2,500 Feet/Day Feet/Day 2,000 Feet/Day 1,903 1,909 Average Feet / Day Feet/Day 1,658 1,438 1,500 1,000 500 0 2Q13 3Q13 4Q13 1Q14…
  16. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 16
    Completions Efficiency Example: La Salle County Frac Stages Pumped / Day 8 7.6 7 Number of Pumped Stages 6.1 6 5 4.3 3.9 4 3 2 1 0 2Q13 3Q13 4Q13 1Q14 Number of Stages Frac Cost / Stage (M) 250 207.2 Frac…
  17. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 17
    Total Well Cost Reduction: La Salle County The last four wells in Alexander Ranch have hit SNs total well cost target of 5.5 million Total Well Cost (MM) Previous Operator 9.0 8.4 Average 8.0 7.0 5.9 6.0 6.0 Average Well…
  18. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 18
    Downspace Testing Across Portfolio Net PUD Reserve Current Locations Report Number of Development Booked Spacing 40 Acre Plan Spacing Utilizing 3D Seismic Area (12/31/13) (Acres) Test Wells (Acres) Microseismic Coverage Palmetto…
  19. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 19
    Top Quartile EBITDA Margins Oil Driven Production 73% of 4Q13 production was crude oil (86% including NGLs) Premium Pricing 93% of oil is sold on LLS pricing Low Transportation Costs - 50% of oil sold into pipelines; multiple sales…
  20. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 20
    Ample Liquidity To Fund Our 2014 Capital Plan Current liquidity of 479 million 4Q13 Capitalization Table & Liquidity (MM) 154 million in cash As of 12/31/2013 400 million borrowing base with an Cash and Equivalents 154 elected…
  21. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 21
    Summary Investment Considerations Rapidly growing base of production and proved reserves Focused on manufacturing efficiency and driving down costs 120,000 net acres in the Eagle Ford with 1,800+ net identified locations Eagle…
  22. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 22
    Appendix 23 2014 Sanchez Energy Corporation
  23. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 23
    Capitalization Summary Revolving credit facility (due 2018) 400 MM borrowing base with an elected commitment of 325 million and an interest rate of LIBOR + 1.50% - 2.50% 0 MM drawn at end of 4Q13 Consortium of 10 banks Restrictive…
  24. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 24
    Hedge Summary & Philosophy We maintain an active hedging program to help support capital spending, protect cash flow, and ensure strong financial coverage metrics Currently have 3.5 million barrels hedged for 2014 at an average…
  25. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 25
    NonGAAP Reconciliation and Measures Reconciliation of Net Income (Loss) To Adjusted EBITDA (M) 3 Months Ended 4Q13 Net Income (Loss) 14,202 Plus: Interest Expense 13,321 Depreciation, Depletion, Amortization, And Accretion…
  26. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 26
    Project Area Type Curves 27 2014 Sanchez Energy Corporation
  27. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 27
    Wycross Area Type Curves & Economics 1,200 550 MBoe EUR 7.5 MM Capex Oil Price ( / Bbl) 80.00 90.00 100.00 NPV-10 (MM) 5.9 7.8 9.8 1,000 Average Monthly Production (Boe/d) IRR 57% 81% 110% Payout (Years) 1.4 1.1 0.9 ROI 2.7x…
  28. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 28
    Alexander Ranch Area Type Curves & Economics 900 500 MBoe EUR 5.5 MM Capex Oil Price ( / Bbl) 80.00 90.00 100.00 NPV-10 (MM) 4.4 5.8 7.3 750 Average Monthly Production (Boe/d) IRR 55% 76% 101% Payout (Years) 1.5 1.2 1.0 ROI…
  29. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 29
    Marquis Area Type Curves & Economics 1,200 550 MBoe EUR 8.0 MM Capex Oil Price ( / Bbl) 80.00 90.00 100.00 NPV-10 (MM) 5.4 7.4 9.4 1,000 Average Monthly Production (Boe/d) IRR 48% 67% 90% Payout (Years) 1.7 1.3 1.1 ROI 2.5x…
  30. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 30
    Palmetto Area Type Curves & Economics 1,500 750 MBoe EUR 7.0 MM Capex Oil Price ( / Bbl) 80.00 90.00 100.00 NPV-10 (MM) 10.9 13.6 16.2 1,250 Average Monthly Production (Boe/d) IRR 149% 205% 273% Payout (Years) 0.8 0.7 0.6…
  31. Howard Weil 42nd Annual Energy Conference – Sanchez Energy Corp – slide 31
    TMS Area Type Curves & Economics TMS Area Single Well Economics TMS Area Development Well Economics 800 MBoe EUR 15.0 MM Capex 800 MBoe EUR 10.0 MM Capex Oil Price ( / Bbl) 80.00 90.00 100.00 Oil Price ( / Bbl) 80.00 90.00 100.00…

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