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Scotia Howard Weil Energy Conference – SM Energy Company

SM Energy Company · Mar 23, 2015 · 30 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. Scotia Howard Weil Energy Conference – SM Energy Company – slide 1
    Scotia Howard Weil Energy Conference Jay Ottoson President and CEO March 23, 2015
  2. Scotia Howard Weil Energy Conference – SM Energy Company – slide 2
    Strategy and Asset Overview How SM Energy will differentially grow shareholder value Continue to increase the value and Significant existing development quantity of core program inventory inventory in each core program Leverage…
  3. Scotia Howard Weil Energy Conference – SM Energy Company – slide 3
    Debt to TTM adjusted EBITDAX Top quartile leverage vs. peers 4.5x 4.0x 3.5x 3.0x 2.5x Peer Median: 2.3x 2.0x 1.5x 1.0x 0.5x 0.0x SM SM Energys December 31, 2014 debt to trailing twelve-month adjusted EBITDAX is…
  4. Scotia Howard Weil Energy Conference – SM Energy Company – slide 4
    Financial Position DEBT MATURITIES AS OF December 31, 2014 (in millions) 2,500 Borrowing Base - 2.4 billion 2,000 Strong balance sheet with significant liquidity. 1,500 First maturity is in 2019. 1,000 Credit Facility:…
  5. Scotia Howard Weil Energy Conference – SM Energy Company – slide 5
    2015 Operated Activity Reducing rig activity and building WOC inventory 20 100 18 90 Wells Waiting on Completion 16 80 14 70 12 60 Rigs 10 50 8 40 6 30 4 20 2 10 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec…
  6. Scotia Howard Weil Energy Conference – SM Energy Company – slide 6
    2015 Capital Expenditures Significantly reduced CAPEX program that yields YoY production growth Drilling and Completion 185 Non-drilling and New Annual Production Ventures (MMBOE) 70 1,045 (in millions) 60.4 63.5 60 55.1 50 30%…
  7. Scotia Howard Weil Energy Conference – SM Energy Company – slide 7
    Financial Outlook Debt to TTM Adjusted 5.0 EBITDAX 2015 CAPEX is expected to be 4.5 150 million in excess of Total debt covenant 4.0 2015 adjusted EBITDAX.* 3.5 Expecting quarterly adjusted 3.0 2.5 EBITDAX to exceed…
  8. Scotia Howard Weil Energy Conference – SM Energy Company – slide 8
    Operated Eagle Ford Program 144,000 total net acres Dimmit 100 93.6 90 83.2 Webb 74.8 76.3 76.2 80 29.7 MBOE/d 70 27.2 24.2 23.3 26.1 60 9.7 50 8.2 7.9 7.8 7.1 40 30 54.2 20 42.8 44.8 48.1 43.0 10 0 Mexico 4Q13…
  9. Scotia Howard Weil Energy Conference – SM Energy Company – slide 9
    Operated Eagle Ford Type Log Austin Chalk SM Energy has some of the thickest total Eagle Ford Shale interval in the play. Upper EF Identified several targets within the Upper and Lower Eagle Ford based on facies work.…
  10. Scotia Howard Weil Energy Conference – SM Energy Company – slide 10
    Upper Eagle Ford East Testing Proving up the viability of the Upper Eagle Ford EAST UPPER EAGLE FORD WELLS CUMULATIVE BOE PRODUCTION 2-STREAM CUMULATIVE PRODUCTION 50 45 40 (MBOE/1000FT) 35 30 25 20 15 10 5 0 0 2…
  11. Scotia Howard Weil Energy Conference – SM Energy Company – slide 11
    Upper Eagle Ford North Testing Proving up the viability of the Upper Eagle Ford NORTH UPPER EAGLE FORD WELLS CUMULATIVE BOE PRODUCTION 2-STREAM CUMULATIVE PRODUCTION 45 40 35 (MBOE/1000FT) 30 25 20 15 10 5…
  12. Scotia Howard Weil Energy Conference – SM Energy Company – slide 12
    Eagle Ford Testing Road Map 12 well stacked/staggered 15 well LEF 3Q15 completion infill spacing test (625 & 450) 2Q15 completion 3 well stacked/staggered 3Q15 completion 2 well LEF W test 2Q15 completion 5 well…
  13. Scotia Howard Weil Energy Conference – SM Energy Company – slide 13
    Eagle Ford North Stack/Stagger Pilot Upper and Lower EF development well spacing in targeted facies Austin Chalk Upper Eagle Ford 120 200 ft 1 PAD 120 1 PAD 85 110 85 Lower Eagle Ford 175 ft 70 525 263 262 525…
  14. Scotia Howard Weil Energy Conference – SM Energy Company – slide 14
    Williston Basin Acreage Divide Sheridan Gooseneck: 120,000 net acres Raven/Bear Den: 25 40,000 net acres 20 MBOE/d Roosevelt Williams 15 23.4 10 Richland 16.1 16.0 16.5 17.5 5 0 4Q13 1Q14 2Q14 3Q14 4Q14…
  15. Scotia Howard Weil Energy Conference – SM Energy Company – slide 15
    Gooseneck Sweet Spot Sizeable acreage position in the sweet spot of Divide County, ND Divide Burke Sheridan, MT Decreasing Decreasing reservoir quality reservoir quality Williams The geology deteriorates as you move east…
  16. Scotia Howard Weil Energy Conference – SM Energy Company – slide 16
    Gooseneck Three Forks vs. Offset Divide Gooseneck Three Forks program outperforms offset operators 16 CUMULATIVE PRODUCTION 14 12 (MBOE/1000FT) 10 8 6 4 2 0 1 3 5 7 9 11 13 15 17 19 21 23 PRODUCING MONTHS Three…
  17. Scotia Howard Weil Energy Conference – SM Energy Company – slide 17
    Gooseneck Bakken Bakken wells in Gooseneck are outperforming the Three Forks type curve. 6 5 CUMULATIVE PRODUCTION 4 (MBOE/1000FT) 3 2 1 Middle Bakken Wells 0 2015 Planned Bakken Completions 0 1 2 3 4 5 6…
  18. Scotia Howard Weil Energy Conference – SM Energy Company – slide 18
    Takeaways SM Energy enters 2015 with a strong balance sheet, significant liquidity, and a robust inventory in core programs. Potential to add meaningful inventory in core programs in current pricing environment. 2015 program…
  19. Scotia Howard Weil Energy Conference – SM Energy Company – slide 19
    Appendix 20
  20. Scotia Howard Weil Energy Conference – SM Energy Company – slide 20
    4Q14 Regional Realizations NYMEX WTI OIL (Bbl) 73.16 Hart Composite NGL (Bbl) 29.53 NYMEX Henry Hub Gas (MMBTU) 3.77 Production Volumes STGC Rockies Mid-Con Permian SM Total Oil (MBbls) 2,164 2,326 27 582 5,099 Gas (MMcf) 34,961…
  21. Scotia Howard Weil Energy Conference – SM Energy Company – slide 21
    2015 Guidance FY 2015 Production (MMBOE) 60.4 63.5 Average daily production (MBOE/d) 165 174 LOE (/BOE) 4.40 4.65 Ad Valorem (/BOE) 0.50 0.55 Transportation (/BOE) 6.25 6.55 Production taxes (% of pre-derivative oil and gas…
  22. Scotia Howard Weil Energy Conference – SM Energy Company – slide 22
    Operated Eagle Ford East Strong asset continues to provide top-tier returns. Dimmit Webb IRR Sensitivity(1) 70% 60% 50% Mexico 40% 30% 100 20% 90 10% 80 0% CUMULATIVE PRODUCTION 70 50 60 70 NYMEX WTI (MBOE/1000FT)…
  23. Scotia Howard Weil Energy Conference – SM Energy Company – slide 23
    Operated Eagle Ford North Improved completions have enhanced this asset. Dimmit Webb IRR Sensitivity(1) 40% 35% 30% Mexico 25% 20% 15% 60 10% 50 5% 0% CUMULATIVE PRODUCTION 40 50 60 70 NYMEX WTI (MBOE/1000FT)…
  24. Scotia Howard Weil Energy Conference – SM Energy Company – slide 24
    Operated Eagle Ford South Wells in southern acreage provide an economic dry gas option. Dimmit Webb IRR Sensitivity(1) 60% 50% Mexico 40% 30% 20% 70 10% 60 0% CUMULATIVE PRODUCTION 50 3.00 3.50 4.00 NYMEX Henry Hub…
  25. Scotia Howard Weil Energy Conference – SM Energy Company – slide 25
    Gooseneck Three Forks Substantial remaining inventory in our most economic Williston program. Divide IRR Sensitivity(1) 50% 40% 30% Williams 20% 16 10% 14 CUMULATIVE PRODUCTION 12 0% 50 60 70 10 (MBOE/1000FT)…
  26. Scotia Howard Weil Energy Conference – SM Energy Company – slide 26
    Raven/Bear Den Bakken Williams IRR Sensitivity(1) 50% 40% McKenzie 30% 20% 25 10% 20 CUMULATIVE PRODUCTION 0% 50 60 70 (MBOE/1000FT) 15 NYMEX WTI 10 Economics(2) Under current assumptions, Well Cost (10,000…
  27. Scotia Howard Weil Energy Conference – SM Energy Company – slide 27
    Adjusted EBITDAX Reconciliation Adjusted EBITDAX (1) (in thousands) Reconciliation of net income (GAAP) to Adjusted EBITDAX (non-GAAP) to net cash For the Three Months Ended provided by operating activities (GAAP): December 31, 2014…
  28. Scotia Howard Weil Energy Conference – SM Energy Company – slide 28
    Oil Derivative Position* Oil Swaps - NYMEX Equivalent Oil Collars - NYMEX Equivalent Ceiling Floor Bbls /Bbl Bbls /Bbl /Bbl 2015 2015 Q1 1,711,000 91.96 Q1 882,000 99.53 85.00 Q2 1,639,000 91.26 Q2 709,000 94.06 85.00 Q3…
  29. Scotia Howard Weil Energy Conference – SM Energy Company – slide 29
    Gas Derivative Position* Natural Gas Swaps - NYMEX Equivalent Natural Gas Collars - NYMEX Equivalent Ceiling Floor MMBTU /MMBTU MMBTU /MMBTU /MMBTU 2015 2015 Q1 23,548,000 4.25 Q1 2,525,000 4.31 4.01 Q2 15,985,000 3.97 Q2 2,296,000…
  30. Scotia Howard Weil Energy Conference – SM Energy Company – slide 30
    NGL Derivative Position* Natural Gas Liquid Swaps - Mont. Belvieu Bbls /Bbl 2015 Q1 781,000 55.42 2015 Total 781,000 Grand Total 781,000 *Includes all commodity derivative contracts for settlement at any time during the first…

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