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Howard Weil 39th Annual Energy Conference – W&T Offshore Inc.

W&T Offshore Inc. · Mar 31, 2011 · 33 slides

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Slides

  1. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 1
    Howard Weil 39th Annual Energy Conference March 31, 2011
  2. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 2
    Company Highlights Key Financials ( in MMs) 2010 2009 2008 Reserve Data 2010 2009 Revenue 706 611 1,216 Proved Reserves (Bcfe) 485 371 Adjusted EBITDA 450 341 884 Proved Developed % 81 % 76 % CAPEX 416 276 775 Oil and Liquids % 47 %…
  3. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 3
    Proved Reserve Geographic Diversification Add Shell properties 2
  4. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 4
    2010 Recap Proved reserves grew 31% to 485 Bcfe. Proved reserve replacement of 231% Completed two significant acquisitions from Total E&P USA, Inc. and Shell Offshore, Inc., adding 145.7 Bcfe of proved reserves as of the closing…
  5. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 5
    Achieving 2011 Goals & Objectives: Focusing on Growth and Profitability Grow reserves Increase production Cost control Improve EBITDA margins High grade asset base Expand our onshore presence 4
  6. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 6
    2011 Capital Budget ( in millions) Category Drill & Evaluate 161 Completion 33 Recompletions 41 Facility Capital 48 Seismic, Leasehold & Other 27 Total Capital 310 The 2011 Capital Budget excludes pending acquisition of…
  7. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 7
    Company Strategy Focus on Growth Complete the pending acquisition of property under letter of intent with Shell Offshore, Inc. Exploit recently acquired Shell properties - Tahoe and S.E. Tahoe properties Continue evaluations of…
  8. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 8
    Acquisitions We are currently working on closing the acquisition of the fourth Shell property and anticipate finalizing the acquisition sometime in the second quarter We are evaluating other potential acquisitions, with a focus on:…
  9. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 9
    Offshore Properties Acquired from Shell Acquired interests in three producing fields in the deepwater Gulf of Mexico on November 3, 2010 Adjusted purchase price of 121.9 million, plus 18 million ARO, or per unit price of 1.75/Mcfe…
  10. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 10
    Proved Producing Property Acquisition from Shell Tahoe SE Tahoe Droshky (1) W&T's Interest 70% WI 100% WI 6.25% ORRI Operator W&T W&T Third Party Water depth 1,500' 1,770' 2,900' Block location VK 783 VK 784 GC 244 Net daily…
  11. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 11
    Compressor Project Opportunity Tahoe compressor project opportunity New compressor will accelerate Tahoe & SE Tahoe production and will produce unique volumes by reducing reservoir abandonment pressure Incremental volume for Tahoe…
  12. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 12
    Investment Highlights of Conventional Shelf Property Letter of intent to acquire a fourth field from Shell Offshore, Inc. which is located in water depth of 20 to 30 feet W&T will be operator and have a large ownership position…
  13. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 13
    Main Pass 108 Field Status Currently affects production at MP 98, MP 108 and MP 163 fields Pipeline has been down since June 2010 Chevron decided not to pursue repairs on its pipeline. They plan to abandon the line. Accounts for…
  14. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 14
    Newly Acquired Fields and Focus Areas 13
  15. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 15
    Drilling Program Since the first of the year Our Main Pass 180 A-2 well reached total measured depth of 13,950 and encountered 91 feet of net vertical pay of high quality gas sands in three separate zones. This well was completed…
  16. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 16
    Gulf of Mexico Attributes Great history of production and reserves Highly prolific with multiple pay zones Reserves at deeper but virtually untapped zones, significant upside potential Established infrastructure on shelf…
  17. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 17
    Our Historical Gulf of Mexico Focus Operating successfully in the Gulf of Mexico for 27 yrs 10 year exploration drilling success rate of 77% 10 year development drilling success rate of 91% Established infrastructure allows for…
  18. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 18
    Regulatory Drilling Activity U.S. Gulf of Mexico New Offshore Well Spuds Source: ODS-Petrodata WellsBase 60 50 40 30 20 10 0 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 17
  19. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 19
    Regulatory Developments -- Deepwater Six drilling permits recently approved No approved exploratory permits with updated regulations Interim final rule (October 14, 2010) Independent verification of BOP capabilities PE certification…
  20. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 20
    Offshore 2011 Drilling Program MP 108 8 & Tex W5 Development WI: 75% West Cameron 73 2 Shelf Exploration WI: 30% MP 180 A-2 Deep Shelf WI: 100% Shelf SS 349 B & C (Drilled and WI: 100% successful) Shelf Viosca Knoll Main W.…
  21. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 21
    Onshore 2011 Drilling Program Development Drilled and successful - one Exploration well in South Texas (50% W.I.) Drilling one well in East Texas (25% W.I.) 4+ Additional Exploration Wells Planned (est. 80% W.I.) East Texas WI:…
  22. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 22
    II Lay Z Prospect WI: 50% Discovery Completed Feb. 26, 2011 21
  23. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 23
    Proved Reserves by Year Natural Gas (Bcf) Oil & NGLs (Bcfe) Total CapEx Acquisitions, drilling and pricing contributed to 2010 800 2,000 increases 735 1,800 639 Reserves & production 1,600 600 growth typically track 1,651…
  24. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 24
    Production Profile Oil & NGLs (Bcfe) Natural Gas (Bcf) 140.0 126.5 Since second half of 2008 focused on preserving 120.0 capital and lower cost projects with favorable 99.2 97.9 impact such as workovers 100.0 49.8 94.8 87.0…
  25. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 25
    Adjusted EBITDA Margins 14.00 100% Cost of goods & services have historically tracked with 12.00 80% commodity prices in the 74% 73% 80% GOM Adjusted EBITDA Margin % 10.00 64% From 2000 thru 2007, Adj. EBITDA margins…
  26. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 26
    W&Ts Strong Liquidity Cash balance at February 28, 2011 73 million Revolver availability of 405.2 million with no amounts outstanding No debt maturities until 2014 Net cash provided by operating activities 464.8 million for…
  27. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 27
    Key Investment Considerations Focused on safety, growth and profitability with environmentally responsible operations Large acreage position in the Gulf of Mexico Operating in the Gulf of Mexico for 27 years Strong cash flow &…
  28. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 28
    Reconciliation of Net Income to EBITDA The following table presents a reconciliation of our consolidated net income to consolidated EBITDA to Adjusted EBITDA: Year Ended December 31, 2005 2006 2007 2008 2009 2010 ( in thousands) Net…
  29. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 29
    W&T Offshore, Inc. (NYSE: WTI) Nine Greenway Plaza Suite 300 Houston, TX 77046 Main line - 713-626-8525 Fax - 713-626-8527 Investor Relations - 713-297-8024 www.wtoffshore.com www.investorrelationswtoffshore.com 29
  30. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 30
    Appendix 30
  31. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 31
    2011 Guidance (1) Estimated Production 1Q 2011 Full-Year 2011 Crude oil (MMBbls) 1.5 - 1.6 5.5 - 6.3 Natural gas (Bcf) 12.0 - 12.6 50.2 - 58.9 Total (Bcfe) 20.8 - 21.9 83.2 - 96.7 Operating Expenses ( in millions) 1Q 2011 Full-Year…
  32. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 32
    Hedging Strategy & Schedule The Company has hedged approximately 1.8 Bcf of its remaining 2010 natural gas production, 0.63 MMBbls of its remaining 2010 oil production, 1.91 MMBbls of its 2011 oil production and 1.10 MMBbls of its…
  33. Howard Weil 39th Annual Energy Conference – W&T Offshore Inc. – slide 33
    % Oil Production and Proved Reserves Profile Total Company 60% 50% 40% 30% 20% 10% 0% 2005 2006 2007 2008 2009 2010 Reserves % Oil and Liquids Production % Oil and Liquids 33

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