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HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co.

Cimarex Energy Co. · Mar 20, 2013 · 27 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 – Cimarex Energy Co. – slide 1
    Howard Weil Energy Conference March 20, 2013
  2. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 2
    Corporate Profile NYSE: XEC Shares outstanding 86.6 MM Proved reserves2.. 2.3 Tcfe Market cap1... 6.2 B % Natural gas 55% Long-term debt 2.. 0.8 B % Proved developed 80% Enterprise value 7.0 B R/P Ratio.. 9.9x Stockholders' equity2…
  3. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 3
    Cimarex Strategy Grow through drilling Generate our own drilling inventory Portfolio approach Keep a mix of opportunitiesgas/oil; low- medium-higher risk projects; seek geologic and geographic diversity Rate of return based…
  4. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 4
    2013 Planned Activity Invest 1.4-1.5 B Solid returns in oil and liquids-rich areas Production growth of 8-13% Permian Basin: Invest 900 MM Bone Spring 110 gross wells Wolfcamp shale 20 gross wells Other unconventional & shallow…
  5. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 5
    2013E Capital Investment Total Capital: 1.4-1.5 B Total Capital by Region: 1.4-1.5 B Permian Mid-Continent Gulf Coast/Other Invest 900 MM Invest 450 MM Invest 100 MM Drill approximately 150 Cana development: 350 MM Working new 3D…
  6. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 6
    Core Operating Areas YE 2012 Reserves 2.3 Tcfe Mid-Continent Permian Q4 2012 Prod. 677 MMcfe/d Gulf Coast 7
  7. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 7
    Proved Reserves 2.4 1.3 2.0 1.2 1.3 1.6 1.2 Tcfe 1.2 1.0 0.8 0.8 0.6 0.4 0.3 77% Gas 23% 33% 41% 45% Liquids 2009 2010 2011 2012 82% 77% 82% 80% % Proved Developed Oil & NGLs (Bcfe) Gas (Bcf) 8
  8. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 8
    Production Growth driven by PB/MC 800 80000% +813% 700 675705 70000% 2535 626 592 650670 600 40 60000% 105 586 500 50000% MMcfe/d 487 400 40000% 300 30000% 200 Yearoveryear % growth 20000% 100 10000%…
  9. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 9
    Permian Basin Summary Statistics Proved reserves (YE 12) 696.7 Bcfe 60% liquids; 99% proved developed Production (Q4 12) 292.1 MMcfe/d 71% liquids Net acres (YE 12) 438 000s Permian Capital Investment 2013E 2012A E&D Capital (MM)…
  10. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 10
    Permian Bone Spring In 2012 drilled 107 gross (60 2012 Bone Spring Drilling net) Bone Spring wells - 64 gross (34 net) in New Mexico - 43 gross (26 net) in Texas Strong New Mexico 2nd/3rd Bone Spring performance: 2012 30-day IPs…
  11. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 11
    Permian Horizontal Wolfcamp 31 32 33 34 35 36 31 32 33 35 36 Southern Eddy Cnty, NM /northern 2 RINGER FED 11 1 12 6 7 5 8 4 9 10 3 2 11 1 12 6 7 5 8 WHITE CITY 14 4 9…
  12. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 12
    Permian Horizontal Wolfcamp Net Operated Production* 50 New Pipeline In Place 40 Drilling and Completion 30 MMcfe/d Delays Due to Pipeline Constraints 20 10 0 1 2 3 4 1 2 3 4 1 2 3 4 2010 2011 2012 Dry Gas…
  13. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 13
    Horizontal Wolfcamp Type Curve 7 4.0 30day avg: 6.4 MMcfe/d EUR: DailyRate(Mmcfe/d) 4.55.5 Bcfe (47% gas, 30% NGL & 23% oil) CumulativeProd.(Bcfe) 3.5 6 3.0 5 Cumulative Production (Bcfe) 2.5 Daily Rate (MMcfe/day)…
  14. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 14
    Horizontal Wolfcamp Economics 50% Forward strip IRR : 34% ( 2-11-13 ) 39% 40% 33% 30% 28% 22% A-tax IRR 20% 17% 10% 0% 75.00/3.00 80.00/3.50 85.00/4.00 90.00/4.50 95.00/5.00 Realized Price - Oil (/Bbl) & Gas (/Mcf)…
  15. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 15
    Horizontal Wolfcamp Summary New key area in Culberson Cnty Improving economics - Seeing consistent and improving well results - Decreasing well cost Completed well costs: - 2011: 9 - 11 MM - 2012: 8 - 9.5 MM - Current estimate…
  16. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 16
    Mid-Continent Region Summary Statistics Proved reserves (YE 12) 1,528.3 Bcfe 35% liquids; 71% proved developed Production (Q4 12) 351.2 MMcfe/d 31% liquids Net acres (YE 12) 753 000s Mid-Continent Capital Investment 2013E 2012A…
  17. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 17
    Cana-Woodford Shale Drilled or participated in 492 wells through Q4-12 120,000 net acres - Avg. NRIs 81% Liquids Rich Liquids Rich Area - Net acres: 75,000 - Gross pay: 100 300 Gas Rich - High oil and NGL content - Essentially…
  18. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 18
    Cana-Woodford Infill Development Infill drilling in liquids- rich core 2013E: 125 gross wells 90 non-operated 2012 Infill Row 35 operated Currently 4 operated rigs Drilling off two well x4 pads with 9 wells/section Focus…
  19. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 19
    Cana-Woodford Net Production 250 Completion backlog increased as result of 215 commencing infill development 200 184 158 161 156 150 139 MMcfe/d 115 99 104 100 84 75 67 50 Q1A Q2A Q3A Q4A Q1A…
  20. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 20
    Cana-Woodford Summary Infill row looking east Q4-12 production: 215 MMcfe/d (36% increase over Q4-11) Gas (MMcf/d) 133 62% NGLs (b/d) 10,463 29% Oil (b/d) 3,168 9% Total (MMcfe/d) 215 100% Significant resource potential:…
  21. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 21
    Summary Recap Well positioned for 2013 and beyond - Primary focus on Permian projects - Continued production and reserve growth in Cana Solid base of proved reserves - 80% proved developed; 10-year reserve life Maintain strong…
  22. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 22
    Appendix 23
  23. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 23
    2013 Guidance 2013 Production, Unit Expense and Capital Guidance 2013E Q1 Full-Year Production Total Equivalent (Mmcfe/d) 642 - 667 675 - 705 % Liquids 50% 51% Expenses (/Mcfe): Production 1.05 - 1.17 Transportation 0.27 - 0.32…
  24. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 24
    Hedges Oil Average Price Daily (2) Period Index Type Volume(1) Floor Ceiling Swap Feb. - Dec. 2013 WTI Swap 6,000 NA NA 96.13 Feb. - Dec. 2013 WTI Collar 6,000 85.00 102.31 NA 12,000 (1) Oil volume = bbls/d (2) WTI = NYMEX…
  25. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 25
    Quarterly Dividend (cents/share) 0.00 0.02 0.04 0.06 0.08 0.10 0.12 Mar06 0.14 Jul06 Nov06 Mar07 Dividend Jul07 Nov07 Mar08 Jul08 Nov08 Mar09 Jul09 Nov09 Mar10 Quarterly Dividend Per Share Jul10 Nov10 Mar11…
  26. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 26
    Non-GAAP Reconciliation Reconciliation of Net Income to EBITDA and Adjusted EBITDA ( in Millions) 2008 2009 2010 2011 2012 Net income (loss) (902) (312) 575 530 354 Income tax expense (benefit) (529) (177) 339 312 207 Interest expense,…
  27. HOWARD WEIL ENERGY CONFERENCE – Cimarex Energy Co. – slide 27
    Non-GAAP Reconciliation Reconciliation of cash flow from operations Debt/Cap Calculation YE YE 2012 2012 (in millions) (in millions) Net cash provided by operating activities 1,193 Long-term debt 750 Change in operating assets…

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