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Howard Weil Energy Conference – Laredo Petroleum Inc.

Laredo Petroleum Inc. · Mar 25, 2014 · 36 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 Energy Conference – Laredo Petroleum Inc. – slide 1
    Howard Weil Energy Conference March 25, 2014
  2. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 2
    Laredo Petroleum Today High-quality, contiguous acreage position in the heart of the Midland Basin Midland Basin Top-tier well results in multiple Delaware horizons Basin Significant resource potential: 10x existing reserves…
  3. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 3
    Concentrated Asset Portfolio Focused in Midland Basin Mitchell Howard 143,212 net acres1 Proven Hz development in four stacked zones (Upper, Middle & Sterling Glasscock Lower Wolfcamp and Cline) 85+ miles Testing…
  4. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 4
    Permian Reserves By Product 204 MMBOE as of 12/31/13 1 Permian Reserve Growth 45% 250 50 55% 45 204 200 40 160 35 Oil Natural Gas (1,300 btu) 150 30 MMBOE /BOE 25 By Category 100 101 20 15 35% 50 10 5…
  5. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 5
    Identified Path for Growth 3,400 3,200 3,000 2,800 2,600 2,400 2,200 MMBOE (2-Stream) 2,000 1,800 1,400 1,600 1,600 1,400 1,200 1,000 800 600 400 204 200 0 Total Proved Additional Identified Additional Total…
  6. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 6
    2014 Approved Capital Budget Total Capital - 2014 Drilling & Completion 1,000 MM 840 MM Number of Rigs / Wells 6-7 Horizontal Rigs Development Wells: 90% Delineation Wells: 10% 5 Vertical Rigs Development: 120 - 125…
  7. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 7
    Consistent Permian Production Growth 70 Crude oil represents 55-60% 60 of production volumes1 50 MBOE/D 1 40 33.4 - 34.8 30 25.0 20.7 20 14.8 10 0 2011 2012 2013 2014P 2015P 2016P 1 Two-stream production: Oil and…
  8. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 8
    Permian Basin: Present Day LPI acreage Cline deposition axis Wolfcamp deposition axis Present day axis Delaware Basin N 0 100 miles 9 NYSE: LPI www.laredopetro.com
  9. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 9
    Laredo Situated Over Thickest Column of Sediment: W-E West East A A Approx. 2,000 ft. of pay Cline Laredo Acreage 1 Modified from Core-Lab, 2013 10 NYSE: LPI www.laredopetro.com
  10. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 10
    Laredo Situated Over Thickest Column of Sediment: N-S North South B B Approx. 2,000 ft. of pay Cline Laredo Acreage 1 Modified from Core-Lab, 2013 11 NYSE: LPI www.laredopetro.com
  11. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 11
    Laredos Permian-Garden City Shales1 Significant oil in place in multiple stacked zones Spraberry Wolfcamp Cline A/B/W Combined Depth (ft) 5,000 7,000 7,000 8,500 9,000 9,500 9,500 10,500 5,000 10,500 Average Thickness (ft) 1,500…
  12. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 12
    Vertical Wolfberry: Confirms Quality of Acreage1 Mitchell Howard 800 vertical Wolfberry wells across acreage 300 deep vertical Wolfberry wells through the Atoka Sterling Glasscock Average vertical well density is 85+…
  13. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 13
    Vertical Program Data Collection Garden City Data Inventory 1 Howard Mitchell 3,400 of whole cores in objective section 13 whole cores 650 SWC samples 43 single-zone tests from objective Sterling section (Spraberry to…
  14. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 14
    Proven Multi-zone Horizontal Performance Commercial development has Mitchell been proven for initial four Howard zones from 96 horizontal wells Horizontal Total of Long Lateral Zone Completions1 30-Day Average IP2 Sterling…
  15. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 15
    Production History Supports Type Curves 150 150 Upper Wolfcamp Lower Wolfcamp 104% of Type Curve 111% of Type Curve 100 758 MBOE 100 Two-stream 668 MBOE MBOE Two-stream MBOE 50 50 - - 0 90 180 270 360 Days 0 90 180…
  16. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 16
    Northern Midland Basin Creaming Curve (Hz since 2008)1 Laredos well results continue to improve 400 350 LPI - Reagan LPI - Glasscock First 3 months cumulative production (MBOE) 300 250 Apache 200 150 3ROC 100 RSP…
  17. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 17
    Concentration of Resources Drives Efficiencies Not to scale Represents 5,000 ft 3 sections / 64 wells 4 Zones Reserves: 44 MMBOE One-rig program: 5+ years D&C 18 NYSE: LPI www.laredopetro.com
  18. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 18
    Transitioning to Muti-Zone Development in 2014 Stacked Lateral 4-Stacked 3-Stacked 2-Stacked Development 2014 program expected 60 wells total to drill 60 stacked lateral wells utilizing 20 multi-well pads Efficiency gains are…
  19. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 19
    Efficiency Gains from Pad Drilling Drill and Complete Days For Individual Well 1 2 5 15 30 52 0 20 Days 40 60 Efficiency Gain for 4-Well Pad vs 4-Well Individual Program 52 52 52 52 3 135 15 18 2 40-Day Efficiency…
  20. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 20
    Production Impact From Multi-Well Pads One Rig, 4-Well Stacked Pad Drilling Example 6,000 5,000 Production 2nd Pad Production Impact (Gross BOE/D) 4,000 Production 1st Pad 3,000 2,000 1,000 Wells Spud, Drill and…
  21. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 21
    Production Corridors Support Offset Pad Development Offset pad configuration provides the optimal geometry to fully drain a section 22 NYSE: LPI www.laredopetro.com
  22. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 22
    Fluid / Gas Management Plan Water well pit Water wells Well pad Multi- line corridor Oil gathering Off lease wtr disposal HP gas lift/HP Sale LP gas gathering Rig fuel gas Flowback water Treated water SR/ET…
  23. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 23
    Cost Savings Initiatives Pad drilling efficiencies Multi-well frac efficiencies Negotiated service cost reductions Coil Pumping services Wireline logging Frac tank Optimizing drilling and completions operations Proppant sourcing…
  24. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 24
    ROR vs Well Capital Costs Permian Well Costs Upper Middle Lower (MM) Cline Vertical Wolfcamp Wolfcamp Wolfcamp 2014 Budget 7.4 7.4 8.1 8.6 2.2 2014 YE Target 6.8 6.8 7.5 8.0 1.9 90/Bbl and 3.75/Mcf 70% 60% 50% ROR (%)…
  25. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 25
    Sales Price Diversification 1 Firm transportation out of the Permian 10,000 BOPD committed to Longhorn, increasing annually to 22,000 BOPD over 5 Cushing years; plus Wichita Falls 10,000 BOPD committed to BridgeTex (Mid- 2014)…
  26. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 26
    Processing Plant Capacity With LPI Direct Connectivity Rawhide Plt Conger Plt 75 MMcf/D 25 MMcf/D Bearkat Plt 60 MMcf/D Processor DCP Midstream High Plains Plt 200 MMcf/D Atlas Glasscock Sterling Plt 62 MMcf/D Ector Midland…
  27. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 27
    Preserving Financial Flexibility 1 1.4 billion of liquidity 1,200 1,000 Credit Facility - Borrowing Base Growing borrowing base 800 MM 600 No near-term maturities 400 200 Strong financial metrics - 1,500 Debt…
  28. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 28
    Oil Hedges Open Positions As of March 1, 2014 2014 2015 2016 2017 2018 Total OIL (1) Puts: Hedged volume (Bbls) 450,000 456,000 - - 906,000 Weighted average price (/Bbl) 75.00 75.00 - - - 75.00 Swaps: Hedged volume (Bbls)…
  29. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 29
    Natural Gas Hedges Open Positions As of March 1, 2014 2014 2015 2016 2017 2018 Total (1) NATURAL GAS Swaps: Hedged volume (MMBtu) 5,508,000 - - - - 5,508,000 Weighted average price (/MMBtu) 4.32 - - - - 4.32 Collars: Hedged…
  30. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 30
    Laredo Investment Opportunity High-quality acreage position in the fairway of the Midland Basin Significant resource potential: 10x existing reserves Top-tier well results in multiple horizons Stacked laterals optimizing…
  31. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 31
    Appendix
  32. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 32
    Expanding Cash Margin 80 70% 70 65% 60 60% 50 55% /BOE % Oil 40 50% 30 45% 49.67 46.39 43.08 20 39.97 40% 36.70 36.54 35.40 36.26 10 35% 0 30% 1Q-12 2Q-12 3Q-12 4Q-12 1Q-13 2Q-13 3Q-13 4Q-13 Cash…
  33. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 33
    2013 Reserve Update 1 487% Production Replacement 250 55 204 200 189 29 11 150 MMBOE 100 50 0 Total Proved Sales of Total Additions and Total Proved Reserves Reserves Production Revisions Reserves…
  34. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 34
    Horizontal Type Curves 1,000 1,000 Upper Wolfcamp Lower Wolfcamp BOE/D BOE/D 100 758 MBOE 100 668 MBOE Two-stream Two-stream 10 10 60 60 Months Months 1,000 1,000 Middle Wolfcamp Cline BOE/D BOE/D 100…
  35. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 35
    Sample Wolfcamp Hz 3-Stream Conversion 2-Stream - Wellhead Conversion 3-Stream Natural Gas 30-Day IP 740 Mcf/D Gas Shrinkage Factor: 25% % of Total Volume: 15% 986 Mcf/D Wellhead Gas % of Total Volume: 23% 30-Day IP 158 Bbl/D…
  36. Howard Weil Energy Conference – Laredo Petroleum Inc. – slide 36
    Sample Cline Hz 3-Stream Conversion 2-Stream - Wellhead Conversion 3-Stream Natural Gas 30-Day IP 906 Mcf/D Gas Shrinkage Factor: 25% % of Total Volume: 17% 1,208 Mcf/D Wellhead Gas % of Total Volume: 27% 30-Day IP 193 Bbl/D…

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