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ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp.

Magnum Hunter Resources Corp. · Feb 11, 2013 · 50 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. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 1
    MAGNUM HUNTER RESOURCES CORPORATION EnerComs Oil & Services Conference 11 February, 2013 San Francisco, California
  2. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 2
    Overview of Magnum Hunter Overview Production Growth (Boe/d) Magnum Hunter Resources is an exploration and Oil / Liquids Natural Gas 18.5 20.0 Mboe production company focused on the most prolific (1) 14,145 unconventional resource…
  3. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 3
    Concentrated Asset Base in Largest Shale Plays 180,000 Net Acres 85,500 Net Marcellus Acres 81,800 Net Utica Shale Acres 300,000 Net Southern Appalachia Acres Year-End 2012 Proved Reserves % Oil/ 26,000 Net Acres…
  4. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 4
    Highest IRR North American Shale Plays MHR Active Resource Plays 60% 56% 54% 53% 51% 50% 44% 43% 40% 37% 36% 36% 35% 34% 31% 31% IRR 30% 28% 26% 23% 22% 22% 21% 19% 18% 18% 20% 17% 16% 16% 13% 12% 12% 9% 9% 10%…
  5. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 5
    Highest IRRs NGL Pricing Scenarios IRR's with NGLs at 40% of WTI IRR's with NGLs at 30% of WTI MHR Active Resource Plays 60% 50% 40% IRR 30% 20% 10% 0% Source: Credit Suisse research, February 2013 Note:…
  6. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 6
    Proved Reserves Summary Proved Reserves up 63% in One Year Proved Reserves Summary Net Proved Reserves as of Year-End 2012 (SEC PRICING) Liquids Gas Total Category (MMBbls) (Bcf) (MMBoe) % PDP 20.8 102.9 38.0 52.0% PDNP 1.8 22.7…
  7. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 7
    Proved Reserve Growth Consistency Robust track record of proved reserve growth since inception Approximately 73.1 MMBoe at December 31, 2012 Anticipate continuing to consistently add proven reserves with an equal mix of oil/liquids…
  8. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 8
    Capital Investment Summary 446 450 350 400 350 300 239 250 MM 200 150 100 12 30 50 0 2009 2010 2011 2012(*) 2013 Williston Appalachia Eagle Ford Eureka Hunter Year-over-Year Capital Efficiency Improvement Wells…
  9. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 9
    Operational Efficiency Improvements (/Boe) 61.18 4.85 34.43 30.54 3.72 20.52 13.36 3.37 6.83 21.90 13.46 10.32 2010 2011 Nine Months 2012 LOE Recurring Cash G&A Production Taxes 8
  10. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 10
    Growth Plan Continues EBITDAX Revenue 300 250.0 250 200 ( MM) 150 134.0 129.2 100 50.4 50 32.7 5.4 6.8 4.2 0 2009 2010 2011 2012(*) Note: New management team took over in May 2009 (*) Calculated as of LTM…
  11. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 11
    Projected Cash Flow and Margin Growth Unhedged Debt Adjusted Cash Flow Growth (2011 -2015e CAGR) Unhedged Cash Margin Growth (2011 -2015e CAGR) MHR, 50% MHR, 21% OAS, 22% DVN, 13% CXO, 17% CHK, 12% GDP, 15% GDP, 11% NBL, 13% ECA,…
  12. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 12
    Eagle Ford 11
  13. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 13
    Eagle Ford Hunter Overview Total proved reserves of 12.6 MMBoe as of December 31, 2012 Proved Reserves Proved producing reserves of 4.0 MMBoe as of December 31, 2012 90% crude oil, with high BTU gas (+1350) Production 43 gross…
  14. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 14
    Eagle Ford Map MHR EOG Hilcorp/Marathon Weber Conoco Phillips Hess / ZaZa Magnum Hunter Penn Virginia Wells GeoSouthern Leopard Hunter 1H Southern Bay 24hr IP 1,333 Boe/d Bertha 1H Penn Virginia 24hr IP 1,591 Boe/d…
  15. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 15
    Eagle Ford Flares From Space The Eagle Ford Shale Garners More Capital than any Other Play Throughout the World Picture Source: Scientific American on December 27, 2012 14
  16. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 16
    Eagle Ford Well Results 2,289 2,218 Average 20+ Stage 24-hour IP = 1,609 Boepd 2,145 2,044 2,033 1,798 1,819 Average 20+ Stage 30-day IP = 868 Boepd 1,590 1,545 1,651 1,591 1,677 1,491 1,321 1,333 1,336 1,275 1,250* 1,039…
  17. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 17
    Eagle Ford Historical Production vs. Type Curve GONZO NORTH 1H SABLE HUNTER 1H FURRH 1H FURRH 2H ORYX HUNTER 1H KUDU HUNTER 1H SNIPE HUNTER 1H LEOPARD HUNTER 1H GONZO NORTH 2H ORYX HUNTER 2H HAWG HUNTER 1H SOUTHERN HUNTER 1H GEO HUNTER…
  18. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 18
    Economic Sensitivity of Eagle Ford Gonzales County CAPEX: 8.5MM + 0.3MM (ESP) + .2MM PU EUR: 500 MBoe 11.0 10.0 IRR: 73% 9.0 IRR: 66% 8.0 Single Well NPV-10 ( MM) IRR: 59% 7.0 IRR: 53% 6.0 IRR: 47% IRR: 41% 5.0 IRR:…
  19. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 19
    Pearsall Shale Pearsall Shale Located about 2500 beneath the Eagle Ford at depths of 7,000-12,000 and is approximately 500-600 in thickness Similar composition to the Eagle Ford Shale, composed of interbedded organic shale, silica and…
  20. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 20
    Williston Basin 19
  21. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 21
    Williston Hunter Overview Areas of Operation Overview Proved Reserves Total proved reserves of 24.0 MMBoe as of 12/31/12 Proved producing reserves of 9.9 100% Avg. WI MMBoe as of 12/31/12 Acreage 48% Avg. WI (Samson operated)…
  22. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 22
    Recent ND Average Results vs. Type Curve 700 Type Curve - 335 Mbo Average 600 500 400 Bopd 300 200 100 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Month * Type curve and historical…
  23. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 23
    Recent Tableland Average Results vs. Type Curve Average Type Curve - 150 Mbo 300 250 200 Bopd 150 100 50 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36…
  24. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 24
    Williston Basin Economics Sensitivity North Dakota West (High Case) North Dakota West (Base Case) Saskatchewan (1 mile lateral) CAPEX: 7.1 Million CAPEX: 7.1 Million CAPEX: 3.5 Million EUR: 730 MBO EUR: 550 MBO EUR: 175 MBO…
  25. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 25
    Williston Basin Acquisition Overview On December 27, 2012, Magnum Hunter closed on the agreement to acquire approximately 20,000 net Williston Basin lease acres from Samson Resources Company for 30 million Consideration for the…
  26. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 26
    Appalachia 25
  27. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 27
    Appalachia Overview Overview Areas of Operation Proved Reserves MHR areas of operations Total proved reserves of 36.5 MMBoe as of 12/31/12 Proved producing reserves of 24.1 MMBoe as of 12/31/12 Acreage 467,000 net acres in the…
  28. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 28
    Economic Sensitivity of Marcellus CAPEX: 6.5MM EUR: 7.8 Bcfe (includes natural gas liquids) 14.0 IRR: 108% 12.0 IRR: 98% 10.0 IRR: 87% Single Well NPV-10 ( MM) IRR: 77% 8.0 IRR: 67% 6.0 IRR: 57% 4.0 IRR: 47% 2.0…
  29. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 29
    Utica Shale Overview Extends approximately 170,000 square miles Utica Shale Permit and Rig Activity throughout the Appalachia Basin in the United States and Canada Ordovician-aged organic rich black shale with interbedded limestone…
  30. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 30
    Utica/Point Pleasant Stratigraphic Overview Stratigraphic Column Appalachian Basin West-East Cross-Section Schematic Source: Enervest 2012 29
  31. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 31
    Type Log and General Parameters Type Log for Utica & Point Pleasant Formations Utica Shale and underlying Point Pleasant Formation are members of the Ordovician Trenton Group and are older than the Marcellus Shale Organic-rich dark…
  32. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 32
    Gross Thickness Utica + Point Pleasant Isopach Map of Point Pleasant + Utica Formations MHR has created a proprietary isopach map of the Utica/Point Pleasant interval The MHR interpretation confirms that the shales exhibit good…
  33. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 33
    Total Organic Carbon (TOC) Map of Maximum TOC (%) in Utica-Logana Interval TOC is a measure of organic content and is indicative of the quantity of kerogen in the rock, which is the source material for oil and gas TOC is typically…
  34. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 34
    Utica Shale Recent Well Results CHESAPEAKE Oil Window Neider 3H* 3.8 MMcf/d; 980 Bbls/d Wet Gas Window (Peak rate) CHESAPEAKE Dry Gas Window Harvey 8H REX 3.8 MMcf/d; 603 Bbls/d Cheeseman 1H (Peak rate) 9.2 MMcf/d CHESAPEAKE…
  35. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 35
    Risked Acreage Value by Operator 34
  36. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 36
    Eureka Hunter Midstream 35
  37. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 37
    Eureka Hunter Midstream Overview Strategically Positioned Assets Pipeline in strategic geographical location in heart of Marcellus wet gas corridor of WV 70 miles of 20 1135 MAOP gathering system in the ground to-date 350+ MMcf per…
  38. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 38
    Eureka Hunter Pipeline Geographical Map Constructed Line Proposed Ohio River Crossing Under Construction 37
  39. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 39
    Mobley Processing Plant Processing complex initially consist of two trains: 200 Mmcf/d + 120 Mmcf/d April 2013 200 Mmcf/d plant came online during November 2012 Equitrans feed Eureka Hunter began deliveries December 20, 2012 38
  40. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 40
    NGL Uplift in Appalachia Following the startup of the Mobley Processing Plant, Magnum Hunter realized an average of .735 / Wellhead Produced Mcf uplift from NGLs December 2012 settlement 120 MMcf/d of additional processing capacity…
  41. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 41
    Eureka Hunter Carbide Facility Large facility (233 acres) Broadening Services Offered by Eureka Hunter Low pressure gathering and centralized compression just outside Louis Wetzel Wildlife Refuge Gathering system for wellhead…
  42. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 42
    Eureka Hunter Pipeline Three pipe solution at Carbide Challenging West Virginia Terrain Ohio River Bore into Ohio (McCormick & Evans) 41
  43. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 43
    TransTex Hunter On April 2, 2012, Magnum Hunters wholly owned unrestricted subsidiary, Eureka Hunter, acquired the assets of TransTex Gas Services, LLC (TransTex) for 58.5 million The 58.5 million purchase price consisted of 46.8…
  44. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 44
    Financial Overview 43
  45. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 45
    Financial Strategy Capital spending driven by rates of return across all operating areas Focused on development of existing acreage 2013 capital budget will focus on high return oil/liquids areas Margins and EBITDA projected to…
  46. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 46
    Capitalization March 31, June 30, September 30, ( in millions) 2012 2012 2012 Cash 31.5 24.8 22.0 Debt: Revolving Credit Facility due 2016 205.0 100.0 175.0 Term Loan 100.0 0.0 0.0 Senior Unsecured Notes due 2020 0.0 444.0 444.1…
  47. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 47
    Adjusted EBITDAX Reconciliation (MMs) Full Year Full Year Full Year LTM 2009 2010 2011 9/30/2012 Net income (loss) (15.1) (22.3) (76.7) (116.8) Unrealized (gain) loss on derivatives, net 7.7 3.1 4.2 20.3 Interest expense, net 2.7…
  48. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 48
    Crude Oil and Natural Gas Hedges Crude Oil 2013 2014 2015 (1) NYMEX Average 97.24 95.03 91.18 Weighted-Average Hedge Price With Ceilings 95.33 100.90 91.25 (2) Weighted-Average Hedge Price With Floors 90.91 85.00 85.00 (3)(4)…
  49. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 49
    Summary of Key Investment Highlights Focused, Liquids-Driven Drilling Factory to Generate Strong Cash Flow Large, Diversified Asset Base in Highest Return Resource Plays Increased Operational Efficiency and Net Margins…
  50. ENERCOMS OIL & SERVICES CONFERENCE – Magnum Hunter Resources Corp. – slide 50
    Equity Research Coverage / Contact Information Magnum Hunter Resources (NYSE: MHR) Equity Research Analyst Coverage: BMO Capital Markets KLR Group Canaccord Genuity MLV Partners Capital One Southcoast, Inc. RBC Capital Markets…

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