Eagle Ford Acquisition Opportunity Newfield Exploration

Transcription

1 Eagle Ford Acquisition Opportunity Newfield Exploration

2 Newfield Eagle Ford Investment Highlights Newfield Exploration ( Newfield or NFX ) is offering for sale its assets located in the Eagle Ford, including Maverick County. Newfield has retained Scotia Waterous and BMO Capital Markets as advisors to assist with the transaction. Core Eagle Ford Acreage Two contiguous Eagle Ford acreage positions comprising 22,800 net acres (~85% HBP) in Dimmit and Atascosa counties, Texas (1) Acreage predominantly lies along the high IRR volatile oil window of the Eagle Ford Volatile oil window comprises a significant portion of current Eagle Ford development Additional 18,500 net acres in Maverick County with current production predominately from the Georgetown Limestone Oil-Weighted Producing Assets with Substantial Remaining Inventory Expected August 2016 net production of 7.7 Mboe/d (~75% liquids) from 125 gross wells (2) Includes net production of 1.2 Mboe/d from 12 WOC wells (expected first production July 2016) (3) 2015 annual operating cash flow of $78 MM Over 300 gross remaining drilling opportunities with average IRR of ~60%, over half of which have IRRs >70% (4) Acreage geometry and in-place infrastructure ideal for efficient continued development 2 Significant Growth Potential Robust drilling inventory includes the Lower Eagle Ford (two zones) and the Upper Eagle Ford, supported by significant OOIP Lower Eagle Ford (66% of total location count) average IRR of >70% and Upper Eagle Ford average IRR >30% (4) Stacked-pay development off existing pads allows for high-pace future growth Recent completion up-sizing by major Eagle Ford operators has substantially increased single-well productivity and returns 1. HBP in this instance denotes both Held by Production and Held by Operations 2. Current net production of 6.5 Mboe/d (73% liquids) 3. Operator (XTO) expected to cap gross production from the 12 WOC wells at 3.0 Mbo/d 4. Based on 3-year NYMEX prices as of May 10, 2016 with $65.00/bbl and $3.25/Mcf held flat thereafter

3 Newfield Eagle Ford Offering Overview Newfield s Eagle Ford projects, West Asherton and Fashing, lie in the volatile oil and black oil windows of the Eagle Ford 3

4 Newfield Eagle Ford West Asherton Current net production of ~5,700 boe/d from 76 gross Eagle Ford wells Attractive Eagle Ford position with substantial remaining resource Thick Lower and Upper Eagle Ford sections with high OOIP, supportive of stacked development Offset operators including Chesapeake and Anadarko are highly active in co-developing multiple zones of the Lower Eagle Ford, as well as the Upper Eagle Ford Over 250 operated Eagle Ford drilling locations remain with >95% working interest: Average single-well IRRs >50% ~2 MM lateral feet of Eagle Ford development remaining (~7,700 foot average lateral length) ~40 infill locations remaining in the lower portion of the Lower Eagle Ford at current spacing Additional ~100 locations supported by nearby analogs of staggered development in upper / lower portions of the Lower Eagle Ford Offset activity and OOIP calculations suggest an additional ~110 locations in the Upper Eagle Ford Development of the Austin Chalk offers substantial attractive additional resource to be developed West Asherton Acreage Highlight Newfield & Offset Operator Wells 4

5 True Vertical Depth (ft.) Cumulative Production (Mboe) Newfield Eagle Ford West Asherton Upside Significant upside potential from: Stacked development of 2 to 4 zones within the Eagle Ford Proximal tests by Anadarko, Sanchez, Noble, and others support stacked development and downspacing Further downspacing below current projected spacing Upsizing of completions actively resulting in higher productivity and returns: Higher proppant concentrations and fluid volumes Tighter cluster and stage spacing Additional targets including the Austin Chalk Further capital and operating cost reductions Eagle Ford Development Plan (Shotgun View) Noble Dimmit Co. Upsized Completion Pilot (1) 0 BR 36 BR 32 NBL 400 Mboe Type Curve Completion Specifics Noble BR 36 Noble BR 32 IP-30 (boe/d) 3,525 2,236 First Production Jan-16 Jan-16 Lateral Length 5,044 4,780 % Oil / % NGL / % Gas 33% / 36% / 31% 30% / 38% / 32% Proppant (Lbs/ft) 2,000 2,000 Fluid Type Hybrid Gel Hybrid Gel Cluster Spacing (ft.) Days on Production + 350% Anadarko Dimmit County Spacing Pilots (Shotgun View) Lateral Placement (ft.) 2,000' 1,000' 0' 1,000' 2,000' 6,900' 7,100' 250' Avg. Well Spacing 250' Avg. Well Spacing 7,300' 50' 165' 7,500' 7,700' Lower Eagle Ford Test Upper Eagle Ford Test 1. Noble Energy Q Earnings Presentation (May 4, 2016) 5

6 Newfield Eagle Ford Fashing Field Expected August 2016 net production of 1.9 Mboe/d from 32 gross Eagle Ford wells Includes net production of 1.2 Mboe/d from 12 WOC wells (average WI of 48%; expected first production July 2016) (1) Acreage is operated by both Newfield and XTO, and is situated in the highly prolific southern extension of the Karnes Trough XTO and offset operators well results and returns among the highest in the Eagle Ford Significant upside remains: Over 50 remaining development opportunities Over 30 locations with IRRs >100% Substantial near-term increase in production from 12 drilled XTO wells (1 st production expected by July 2016) XTO has conducted several down-spacing pilots in Fashing and is expected to develop its remaining acreage at 460 foot spacing between laterals Lower Eagle Ford type curve EUR of over 700 Mboe (7,500 ft lateral, ~90% liquids) Austin Chalk potential supported by proximal development by Marathon and other operators Further capital and operating cost reductions Fashing Acreage Highlight Newfield & Offset Operator Wells 1. Operator (XTO) expected to cap gross production from the 12 WOC wells at 3.0 Mbo/d 6

7 Newfield Maverick County Primarily operated interest in 41,000 gross / 18,500 net acres in several projects in Maverick County Three key areas with potential future development: Burr Ranch (Georgetown), Chittim A (Pearsall Shale), and Mula Creek (San Miguel Tar Sands) ~90 boe/d of current oil-weighted net production Burr Ranch includes 13 producing Georgetown oil wells with identified drilling locations Horizontal development along well defined shear zones in the Georgetown Carbonate; four upside locations have been identified, with potential for several more Chittim A is a large acreage position along the Chittim Arch with potential for the liquids-rich Pearsall Shale Early stage play possessing key fundamental shale-gas elements fractures, overpressure, and encouraging producing wells (gas and condensate) Mula Creek includes a large acreage position targeting San Miguel Tar Sands 1 billion barrel (OOIP) heavy oil deposit with several historical pilot projects Southeast Maverick County Glass Ranch position includes 4 Eagle Ford producing wells Maverick Acreage Highlight Newfield & Offset Operator Wells 7

8 Process Timing May 2016 S M T W T F S June 2016 S M T W T F S July 2016 S M T W T F S Interested parties are required to execute a Confidentiality Agreement ( CA ) before accessing the Virtual Data Room or attending a Data Room Presentation. The executed CA should be sent to Wil Fischer via at wil.fischer@scotiabank.com Key Events May 25 Jun. 1 - Jul. 8 Mid-July Virtual Data Room Opens Physical Data Room Presentations (Scotia Houston Office) Targeted Bid Date *Holidays Doug Reynolds Managing Director & Head of U.S doug.reynolds@scotiabank.com Rene McKale Director, Engineering rene.mckale@scotiabank.com Cameron Todor Associate, Engineering cameron.todor@scotiabank.com Robert Urquhart Director robert.urquhart@scotiabank.com Max van Adrichem Associate Director, Corporate Finance max.vanadrichem@scotiabank.com Tim Pish Director, Geology tim.pish@scotiabank.com Scott Trackwell Associate, Corporate Finance scott.trackwell@scotiabank.com Wil Fischer Analyst, Corporate Finance wil.fischer@scotiabank.com Geoff Roberts Managing Director & Head of U.S. A&D geoff.roberts@bmo.com Howard Barnwell Director howard.barnwell@bmo.com Steve Hendrickson Senior Engineer steve.hendrickson@bmo.com Jason Martinez Managing Director jason.martinez@bmo.com Dan Schockling Director, Commercial dan.schockling@bmo.com Eric Monus Vice President, Engineer eric.monus@bmo.com 8

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