Eagle Ford Hilcorp Resources Acreage Acquisition June 1, 2011
Hilcorp Acreage Acquisition Summary 3.5 Billion cash, subject to closing adjustments and HSR approval 141,000 net acres (217,000 gross acres) Resource potential of 400 500 MMBOE (100 MMBOE proved by Y-E 2011) Potential additional…
MROs Overall Eagle Ford Position Premier U.S. Resource Play Strong operated position 285,000 net acres expected by year end 2011 Approximately 90% operated with a 80% average working interest Average cost < 15,000 per acre 600 MMBOE…
MROs Overall Strategic Direction Shift from few large projects to lower risk and scalable resource plays Focused on liquids Retain upside to natural gas Fund growth with internally generated cash Strong base business Continue to…
Growth Assets Liquids Rich Resource Plays In-situ Bakken Shale DJ Basin (Niobrara) Anadarko Woodford Shale Eagle Ford Shale 6
Growth Assets Liquids Rich Resource Plays Bakken Anadarko DJ Basin Eagle Ford Shale* Shale Woodford Shale* (Niobrara)* Net acres 375,000 110,000 285,000** 133,000 Potential net locations 450 450 1,850 400 Well Costs, MM 7.0…
Eagle Ford Trends Black Oil Oil Volatile Oil Condensate Marathon Oil Dry Gas Hilcorp Resources *Includes the Hilcorp acreage and other transactions expected to close by the end of 2011
Play Characteristics Uniform, continuous and predictable shale across the play 130 miles x 50 miles 230 million acres High success rate from wells drilled and completed Long life and high EUR wells Natural fractures, matrix…
Hilcorp Acreage Acquisition Average & Well Characteristics by Trend Condensate Volatile Oil Black Oil Dry Gas Total Gross Acres 56,000 102,000 33,000 26,000 217,000 Net Acres 41,000 51,000 26,000 23,000 141,000 Gross Wells 540 500…
Hilcorp Acreage Acquisition Single Well Economics Condensate Volatile Oil Black Oil IP 30 day 1,650 675 385 (BOEPD)* EUR (MBOE)* 965 645 445 % Liquids 72% 77% 95% Liquid Revenue % 83% 87% 97% Gross Cost M 7,900 7,700 8,100 7,900…
Hilcorp Acreage Acquisition Capex by Year 4,000 3,500 3,000 2,500 2,000 MM 1,500 1,000 500 - 2011 2012 2013 2014 2015 2016 12
Hilcorp Acreage Acquisition Production by Year 90 80 70 60 MBOEPD* 50 40 30 20 10 0 2011 2012 2013 2014 2015 2016 * Shown on Dry Gas + NGL basis 13
Crude Oil and Natural Gas Marketing Current Take Away Arrangements 28,000 Bpd liquids capacity to local refineries 100,000 Mcfpd gas take away capacity contracted or underway Contracts structured to capture NGL value Future…
Upside Potential Further 80 acre development Optimization of drilling program Longer laterals Multi-well pads Completion design Lower drilling, facilities, and service costs Cycle time reduction Development of gas acreage…
MRO Marathon Oil Corporation Key Strategies Maximize value from existing base assets Establish profitable-sustainable growth in reserves and production Create significant value through exploration Maintain strong balance sheet and…
What Distinguishes MRO Large and stable base assets provide significant earnings and free cash flow Leveraged to liquids with retained natural gas upside Disciplined and sustainable reserve/production growth (5-7% CAGR, excluding…
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