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4Q 2010 Financial and Operating Results – Whiting Petroleum Corp.

Whiting Petroleum Corp. · Feb 24, 2011 · 59 slides

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Slides

  1. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 1
    Whiting Petroleum Corporation Drilling the Rohde 14-6XH Cross-Unit Well in Sanish Field, Mountrail County, ND IP: 3,293 BOE/D Fourth Quarter 2010 Financial and Operating Results Res lts February 24, 2011 Drilling operations…
  2. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 2
    Reserve and Resource Information Whiting uses in this presentation the terms proved, probable and possible reserves. Proved reserves are reserves which, by analysis of geoscience and engineering data, can be estimated with reasonable…
  3. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 3
    Company Overview Market Capitalization1 7.4 B Long-term Debt2 800.0 MM Shares Outstanding 117.1 MM Debt/Total Cap2 24.0% Proved reserves3 304.9 MMBOE % Oil 83% RP ratio4 12.9 years Drilling the Hutchins Stock Association 1096…
  4. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 4
    Consistently Strong Margins Consistently Delivering Strong EBITDA Margins (1) 69.19/Bbl 69.06 4.90/Mcf 65.00 61.48/BOE 53 57 53.57 55.00 50.52 Whiting Realizzed Prices(1) 44.70 45.01 45.10/65% 45.00 41.58/68% 35.23…
  5. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 5
    Platform for Continued Growth Average Daily Production Proved Reserves (12/31/2010) 3% 75.0 14% 70.0 3% n (MBOE/d) 64.7 40% 65.0 60.0 Average Daily Production 55.5 55.0 40% 47.9 50.0 Rocky Mountains Permian Basin…
  6. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 6
    Map of Operations Q4 2010 67.9 MBOE/d ROCKY MOUNTAINS 4% 4% 40.8 MBOE/D 14% MICHIGAN 2.9 MBOE/D 60% 18% Michigan Gulf Coast MID-CONTINENT 9.3 MBOE/D Mid-Continent Permian Basin Rocky Mountains PERMIAN 12.2 MBOE/D…
  7. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 7
    Whiting Total Reserves and Resources at Dec. 31, 2010 Oil & NGL % of Total 3P MMBO MMBNGL MMBO BCF MMBOE MMBOE PDP 134 13 147 204 181 29% PBP 2 1 3 13 5 1% PNP 24 4 28 3 29 5% PUD 64 12 76 83 90 14% Total Proved (1) (2) 224 30…
  8. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 8
    Major Fields with Probable and Possible Reserves at December 31, 2010 (1) (2) Capex p Region Field MMBOE MM Per BOE Permian North Ward Estes 130 1,199 9.22 (Additional phases and larger CO2 slug sizes) Rockies Various Fields and…
  9. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 9
    Whiting Total Resource Potential at Dec. 31, 2010 (1)(2)(3) Using SEC Prices of 79.43/Bbl and 4.38/Mcf Held Flat Oil & NGL Nat. Gas MMBO MMBNGL MMBO BCF MMBOE PV10, MM Williston Basin Bakken & Three Forks 127 11 138 70 149 1 1,670…
  10. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 10
    Whiting Total Reserves at December 31, 2010 with Breakout of % Bakken / Three Forks and EOR BAK & BAK & 3FKS 3FKS EOR EOR MMBOE (MMBOE) % (MMBOE) % PDP 181 49 27% 65 36% PBP 5 0 2% 0 0% PNP 29 0 0% 27 93% PUD 90 25 28% 41 46%…
  11. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 11
    Whiting Pre-Tax PV10 Values at December 31, 2010 (1) Using 79.43/Bbl and 4.38/Mcf Held Flat Oil & NGL Nat. Gas MMBO MMBNGL MMBO BCF MMBOE PV10, MM PDP 134 13 147 204 181 3,718 PBP 2 1 3 13 5 42 PNP 24 4 28 3 29 423 PUD 64 12 76 83 90…
  12. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 12
    Finding Costs (in Thousands) Seven-Year 2004 2005 2006 2007 2008 2009 2010 Total/Avg (2004 2010) Proved Acquisitions 525,563 906,208 29,778 8,128 294,056 78,800 22,763 1,865,296 Unproved Acquisitions 4,401 16,124 38,628 13,598…
  13. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 13
    Reserve & Production Profiles Avg. Production By Proved Reserves Core Area A off D As Dec. 31 31, 2010 Q4 2010 305 MMBOE 67.9 MBOE/d 4% 4% 29% 14% 60% 18% 71% Developed Michigan Gulf Coast Undeveloped Mid-Continent…
  14. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 14
    2010 vs. 2011 Capital Expenditures By Reserve Category 2010 978 MM Actual 2011 1,350 MM Budget 20% 16% 8% 37% 23% 25% 49% 22% Proved CO2 Recovery Projects (Proved) Non-Proved Land 14
  15. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 15
    Whiting Developed & Undeveloped Acreage by Core Area 15
  16. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 16
    Key Development Areas for 2011 ( in millions) Sanish Field Northern Rockies Existing Properties Net Wells Capex 54 352 Sanish 2011 Capital Projects Parshall Lewis & Clark Lewis & Clark Net Wells 30 Capex 278 2011 Exploration…
  17. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 17
    2011 Exploration and Development Budget Estimated Gross and Net Wells in 2011 EST. 2011 CAPEX PLANNED WELLS (In MM) Gross Net NORTHERN ROCKIES Sanish Field 352 95 54 Parshall Field 12 11 2 Lewis & Clark Area 278 51 30 Other (Hidden…
  18. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 18
    Whiting Prospect Areas in Bakken/Three Forks Hydrocarbon System at February 1, 2011 (1) Sanish S i h / Parshall P h ll Gross Net Net Undev Undev. Acres Acres Acreage - Bakken and Three Forks Objectives - 182M Gross, 85M Net Acres…
  19. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 19
    Sanish and Parshall Fields - Recent and Notable Wells 17-mile 6 Residue Units in which WLL Owns an Gas/NGL Line to WBI- 17-mile 8 Crude Oil Line To Enbridge Initial oil sales PARSHALL FIELD Gas sales to Midwest markets To Midwest…
  20. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 20
    Robinson Lake Field Office and Gas Plant Mountrail County, North Dakota On right, current 60 MMcfd Inlet Capacity Robinson Lake Gas Plant (with expansion to 90 MMcfd in the third quarter of 2011 underway). On left, adjoining newly…
  21. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 21
    New Robinson Lake Field Office Mountrail County, North Dakota 21
  22. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 22
    Expansion of Robinson Lake Field Gas Plant January 2011 22
  23. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 23
    Improving IP, 30-, 60- and 90-day Average Production Rates for Whiting Operated Bakken Wells in Sanish Field 65 850 2007 1,034 858 871 2,478 980 811 757 741 2008 2,302 950 2009 839 700 631 1,963 2010 16 1 1,651 34 25 1…
  24. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 24
    Improving IP, 30-, 60- and 90-day Average Production Rates for Whiting Operated Three Forks Wells in Sanish Field 1,302 558 453 442 2009 7 2010 1,012 431 368 334 3 Average 60 Day Rate BOEPD Average 90 Day Rate BOEPD 1 2 3…
  25. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 25
    Six Month Cumulative Production by Operator For Bakken Wells Drilled Since January 2009 Source: IHS Energy, Inc. January, 2011 25
  26. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 26
    Bakken Drainage Area Micro Seismic recorded during fracture stimulation of the Holmberg 44-24H 24-Stage Frac / IP: 2,558 BOE/D on April 13, 2010 Toe of Lateral 1280 Acres Heel of Well developed NE-trending natural fractures…
  27. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 27
    Sanish Field Development Pattern Bakken Cross-Unit Bakken Wing Well Configuration Well Configuration Three Forks Well Configuration Combined Bakken (Wing Well) & Three Forks Configuration Bakken Three Forks 27
  28. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 28
    Fully Developed Bakken and Three Forks Horizontal Wells in Sanish Field Area (1)Represents an increase of 153 gross wells from the previous estimate of 382. Well counts and well plans will vary based upon continued…
  29. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 29
    Typical Bakken Production Profiles Sanish Field (1) (2) Production Profiles in Oil Equivalents Bakken - Sanish EUR - 950 MBOE, CAPEX 5.5MM Nymex oil price/Bbl 70 80 90 10,000 ROI 6.1:1 7.3:1 8.4:1 IRR (%) 395% 676% 1,138%…
  30. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 30
    Typical Three Forks Production Profile Sanish Field (1) (2) Production Profile in Oil Equivalents Three Forks - Sanish 1,000 EUR - 400 MBOE , CAPEX 5.5 MM Nymex oil price/Bbl 70 80 90 on ROI 2.2:1 2.7:1 3.2:1 quivalent…
  31. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 31
    Finding Cost Comparison (oil = good) Eagle Ford Marcellus Bakken (1) (1) (2) (3) Hawkville Field Black Hawk SW Pennsylvania (700 MBOE) Estimated EUR's MMCF 2500 1800 3600 280 MBO / Cond 195 550 239 605 MB NGL 249 220 48 Using a…
  32. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 32
    Williston Basin Off-take Expansion Existing Pipelines Proposed Pipelines All Volumes Existing 2011 2012 2013 Total Barrels per Day Capacity Additions Additions Additions Enbridge 160,000 25,000 Q1 145,000 Q1 330,000 Bridger /…
  33. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 33
    Lewis & Clark Area 250 Units / 500 Potential Locations OBJECTIVE pp Three Forks along Upper g pinch-out p of the General Outline overlying Bakken Shale Bicentennial Field Wolski 44-23 TFH Upper Bakken Shale ACREAGE Completing…
  34. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 34
    Production History of Federal 32-4H Well at Lewis & Clark (1) (2) (3) Gross Production Federal 324H Production 2/15/11: 7,686 Lateral / 15Stage Frac 187 BOE/D 1,200 1,000 800 BOE / d 600 400 200 0 11/15/09…
  35. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 35
    IP, 30-, 60- and 90-day Average Production Rates for Whiting Operated Three Forks Wells at Lewis & Clark Average Average Average 1st 1st 60 1st 90 IP (BOE/d) 24-hr. 30 Days Days Days Well Name WI NRI Test Date Test (BOE/d) (BOE/d)…
  36. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 36
    Redtail Niobrara Prospect Weld County, Colorado OBJECTIVE Niobrara Shale ACREAGE Whiting g has assembled 102,424 , gross (73,115 net) acres in our Redtail prospect in the northeastern portion of the DJ Basin This acreage…
  37. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 37
    Big Tex Prospect Pecos, Reeves and Ward Counties, Texas OBJECTIVE Wolfcamp and Bone Spring ACREAGE Whiting has assembled 84,304 gross (71,736 net) acres in our Big Tex prospect in the Delaware Basin: Average WI of 85% Average…
  38. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 38
    Flat Rock Field Uintah County, Utah 22,029 gross acres (11,454 net) 25.2 MMcfe of daily net production as of February 15, 2011, up from 20.9 MMcf/d in December 2010 13 3 wells e s in tthe e Entrada t ada formation o at o…
  39. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 39
    EOR Projects - Postle and North Ward Estes Fields % Postle Postle Total N. Ward Whiting N. Ward Estes Whiting Estes 12/31/10 Proved Reserves Oil MMBbl 130 124 254 49% Gas Bcf 276 27 304 9% (1) (1) Total MMBOE 177 128 305 42% %…
  40. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 40
    EOR Projects Net Production Forecasts (1) Postle Field 3P Unrisked Net Production Forecast (2) 12 130 - 140 MMcf/d Current Mboe/d CO2 Injection 10 8 Production Rate M P1 + P2 (no P3) 6 4 Proved 2 0 Jun Dec 05 10…
  41. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 41
    Total Postle, N. Ward Estes and Ancillary Properties Fully Developed Costs Per BOE Reserves or Acq. and Net Production Dev. Cost (MM) (Net MMBOE) (/BOE) Acquisition Purchase Price (effective 7/1/05) 802 Remaining Proved at…
  42. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 42
    Development Plans Postle Field Texas County, Oklahoma Total 2011 - 2015 Remaining Capital Expenditures (in millions, net) CapEx Drilling, Completion, Workovers & Dry Trail Gas Plant 285 CO2 Purchases 11 T t l Total: 296…
  43. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 43
    Postle Quarterly Average Net BOE/D Production Postle Field Q4 10 CO2 Injection 140 MMcfd Q4 10 Net Prod: 8,905 BOE/D 10600 9600 Net boe//d 8600 7600 6600 N 5600 4600 Mar-07 Mar-08 Mar-09 Mar-10…
  44. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 44
    Development Plans North Ward Estes Field Ward and Winkler Counties, Texas Project Timing and Net Reserves (1) Injection Other CO2 Project Start Date PVPD Proved P2 P3 Total Base: P B Primary, i 33 12 1 64 110 WF & CO2 Phase 1…
  45. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 45
    Development Plans North Ward Estes Field Ward and Winkler Counties, Texas Injection CO2 Project Start Date Phase 1 2007 - 2008 Total 2011 - 2040 Remaining Capital Expenditures (1) Phase 2 2009 - 2010 (In Millions) CapEx (2)…
  46. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 46
    North Ward Estes Quarterly Average Net BOE/D Production North Ward Estes Field Q4 10 CO2 Injection: Q4 10 Net Prod: 240 MMcf/d 7,570 BOE/D 8800 Commencement of CO2 injection in Pilot in May 8200 2007 at 2 MMcf/d CO2 injection…
  47. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 47
    Whiting Estimated Oil Recovery Type Curve from CO2 Flood North Ward Estes (1) (1) Whiting currently estimates a 15% recovery factor in arriving at its total for proved, probable and possible reserve 47 potential. The Company is…
  48. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 48
    Whiting Estimated Oil Recovery Type Curve from CO2 Flood North Ward Estes (1) P1 + P2 P1 (P3) (P2) (P1) (1) Whiting currently estimates a 15% recovery factor in arriving at its total for proved, probable and possible…
  49. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 49
    Production Growth (in BOE/D) Net Production from Bakken, Postle and N. Ward Estes 30,000 25,000 20,000 15,000 10,000 5,000 0 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Bakken 18 630 18,630 21 690 21,690 25 890 25,890 27 385…
  50. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 50
    Adjusted Net Income and Discretionary Cash Flow for the Three Months Ended Dec. 31, 2010 and 2009 (1)(2)(3) Three Months Ended 12/31/10 12/31/09 (In millions, except per share data) Net Income 65.9 (11.2) Adjusted Net Income 99.0…
  51. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 51
    Adjusted Net Income and Discretionary Cash Flow for the Twelve Months Ended Dec. 31, 2010 and 2009 (1)(2)(3) Twelve Months Ended 12/31/10 12/31/09 (In millions, except per share data) Net Income 272.7 (117.2) Adjusted Net Income…
  52. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 52
    Outstanding Bonds and Credit Agreement Amount Ratings Current Coupon / Description Maturity Outstanding Moodys / S&P Price 7.00% / Sr. Sub. NC 02/01/2014 250.0 mil. Ba3 / BB 106.375 6.50% / Sr. Sub. NC4 10/01/2018 350.0 mil. Ba3 /…
  53. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 53
    Total Capitalization ( in thousands) Dec. 31, Dec. 31, 2010 2009 Cash and Cash Equivalents 18,952 11,960 Long-Term Debt: Credit Agreement 200,000 160,000 Senior Subordinated Notes 600,000 , 620,000 , Total Long-Term Debt…
  54. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 54
    Guidance for Q1 and Full-Year 2011 Guidance First Quarter Full-Year 2011 2011 Production (MMBOE). 5.70 - 5.90 25.80 - 26.20 Lease operating expense per BOE. BOE 12 20- 12.40 12.20- 12 40 11 20- 11.40 11.20- 11 40 General and…
  55. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 55
    Disciplined Hedging Strategy (1) Utilize hedges to manage exposure against potential commodity price declines while maintaining pricing upside Employ mix of contracts weighted toward the short-term Existing Crude Oil Hedge Positions…
  56. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 56
    Fixed-Price Marketing Contracts Existing Natural Gas Marketing Contracts (1) Contracted Volumes Weighted Average Contracted Price As a Percentage of Period (Mcf per Month) (/Mcf) Dec. 2010 Gas Production Q1 2011 777,960 5.30 31.4%…
  57. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 57
    In Summary Geographically diversified, long- Five core regions; 12.9 (1) year R/P lived reserve base Grown proved reserves 325% from 71.7 MMBOE at Nov. 2003 IPO to 304.9 MMBOE at 12/31/10 Multi-year inventory of Grown production…
  58. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 58
    Adjusted Net Income (1) (In Thousands) Reconciliation of Net Income (Loss) Available to Common Shareholders to Adjusted Net Income (Loss) Available to Common Shareholders Three Months Ended Twelve Months Ended D Dec. 31 31, D…
  59. 4Q 2010 Financial and Operating Results – Whiting Petroleum Corp. – slide 59
    Discretionary Cash Flow (1) Reconciliation of Net Cash Provided by Operating Activities to Discretionary Cash Flow (In Thousands) Three Months Ended D Dec. 31 31, 2010 2009 Net cash provided by operating activities..... 277,022…

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