Prepared for Today and Focused on the Future Solid 3Q results financially and operationally Strong hedging protects 2015 & beyond 175% of 2015 PDP oil hedged (85/bbl) 95% of 2016 production from PDP hedged Scalable drilling program…
Significant Production and EBITDAX Growth in the Past Year Total Production Oil Production 28.0 8.0 25.0 7.0 22.0 6.0 MBoepd MBopd 19.0 5.0 16.0 4.0 13.0 10.0 3.0 7.0 2.0 3Q13 3Q14 3Q13 3Q14 Cleveland Production…
2014 YTD Capital Spending Summary 80% of increased 14 spending driven by positive factors: 1. Increased average working interest 9% Accounts for 60% of additional spending 2% Very efficient use of additional capital 15% 2. Better…
Hedging Program Among the Best of Peer Group Extensive hedging program provides security in an uncertain commodity price environment 100 2015 % oil hedged 75 50 25 0 100 2015 % gas hedged 75 50 25…
2015 EBITDAX Protected from Most Price Risk Jones strong hedge position mitigates the risk of continued commodity price declines 7% decline in 100% total EBITDAX with hedges 80% 55% decline in total EBITDAX Relative…
The Anadarko Basin Prolific History with Stacked Pay Potential Stacked pay zones within concentrated footprint provide significant development opportunities Current Target Formations Tonkawa Sandstone Lease Acreage: 35,000…
Anadarko Operations Focused on the Cleveland 10 rigs currently running in 4Q 9 Cleveland, 1 Tonkawa Represents nearly 30% of total Cleveland industry activity with 30 rigs running in play Perf and plug and sliding sleeve wells…
Cleveland Frack Trial Results Oil Uplift From Additional Frack Stages Comparison of Average Cumulative Oil Production & Oil Decline Curve 500 Sliding sleeve results tracking 20x3 oil uplift 20x3 incremental oil production…
Cleveland: Determining the Completion that Yields Top Returns 20 Stage Open-Hole 20x3 Perf and Plug Sliding Sleeves 33 Stage Open-Hole 2010 - 2013 2013/14 frack trial 2H14 method 2015 opportunity AFE: 3.3 million AFE: 4.5 million…
Significant Operational Flexibility Heading into 2015 Potential to grow production while still preserving liquidity Estimated Metrics(1) 6 Rig Program 8 Rig Program Production Growth 10% - 15% 20% 25% Debt/EBITDAX 3.1x 3.0x…
Consistent Inventory Growth in Core Cleveland over Multiple Years JONE continues to expand Cleveland inventory well ahead of the pace of drilling Growth achieved through multiple avenues including active leasing, JDAs, and…
Cleveland Leasing Update Nearly 21,000 net acres added year to date for 26.7 million (less then 1,300 per net acre) Total Cleveland net location additions YTD total 163 with an average WI of 77% Still working to acquire additional…
Expanding our Horizons via Geosciences Growing opportunities through geoscience focus Hired Jeff Tanner to head up Geosciences team Mid-Continent has shown stacked pay opportunities in previously unexploited formations Tonkawa,…
Tonkawa A More Oily Opportunity Drilling program underway Tonkawa 2.9 million acres Drilled 5 wells using 20-stage cemented sliding sleeve 6th well spud and progressing Average formation depth: On track to achieve target well…
Marmaton Shows Promise As Others Drill Ahead Marmaton lies just below the Marmaton Lime 1.0 million acres Cleveland formation Majority of Jones Anadarko Average formation depth: acreage lies within the Marmaton Tonkawa: 7,500 feet…
Jones Energy Prepared for the Future Mid-Continent Focus History of success through multiple commodity cycles for over 25 years Expertise creates opportunities to acquire at favorable prices Stacked Pay Zones Multiple horizons…
APPENDIX
2014 Full Year Guidance and 4Q Production Guidance Full Year Total Production (MMBoe)[1] 8.4 - 8.8 Full Year Average Daily Production (MBoe/d)[1] 23.0 - 24.0 Fourth Quarter Total Production (MMBoe)[1] 2.25 - 2.30 Fourth Quarter…
Lease Operating Expense Among the Lowest of Peer Group Jones lease operating expense remains low compared to peers Top quartile performer through first nine months of 2014 Further evidence of efficient operations and a direct benefit…
Jones Commodity Price Realizations - Steady and Predictable Steady, predictable differentials Ample midstream takeaway options in the Mid-Continent region Realizations compare favorably to infrastructure constrained regions Jones…
Oil Gathering System for Cleveland Production Recently signed 10 year oil gathering agreement with Monarch Oil Pipeline for capacity of up to 12,000 barrels per day on system expected to be in service 2Q15 Benefits include: Reduced…
Corporate Structure Metalmark, Management Public & Other Investors Shareholders Class B Common Stock Class A Common Stock 74.7% of voting power in Jones 25.3% of voting power in Jones Energy, Inc. Energy, Inc. 74.7% of total…
Up-C Structure Overview JONE went public using an Up-C structure Other recent energy IPOs with Up-C structure include: Athlon Energy Inc. Franks International N.V. Parsley Energy, Inc. Due to the Up-C structure, on its financial…
Forecasting JONE EPS The simplest way to forecast JONE EPS is on a 100% basis: Income before income tax - Income tax provision (36.5% of pre-tax income*) Net income Total Class A and B shares outstanding of 49,367,741 Net income…
Forecasting JONE EPS Alternatively, EPS can be calculated using net income attributable to controlling interests and Class A shares outstanding: Income before income tax on 100% basis - Pre-tax income attributable to non-controlling…
Understanding JONE EPS Calculation on Reported Financial Statements Breakdown of JONE Income Tax Calculation ( in millions, except per share data) JONE Q3 2014 Income Statement Income before income tax ( in thousands, except per…
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