April 25, 2012 HK to Acquire GEOI Exhibit 99.2 |
NYSE: HK Forward-Looking Statements 2 This presentation contains forward-looking information regarding Halcón Resources and GeoResources that is intended to be covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. Forward- looking statements are based on Halcón Resources’ and GeoResources’ current expectations beliefs, plans, objectives, assumptions and strategies. Forward-looking statements often, but not always, can be identified by using words such as "expects", "anticipates", "plans", "estimates", "potential", "possible", "probable", or "intends", or where Halcón Resources or GeoResources states that certain actions, events or results "may", "will", "should", or "could" be taken, occur or be achieved. Forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those reflected in the statements. These risks include, but are not limited to: anticipated timing for closing the proposed merger, the possibility that the companies may be unable to obtain stockholder or other approvals required for the acquisition or will not be able to satisfy the other conditions to closing; that problems will arise in the integration of the businesses of the two companies; that the acquisition may involve unexpected costs; operational risks in exploring for, developing and producing crude oil and natural gas; uncertainties involving geology of oil and natural gas deposits; the timing of and potential proceeds from planned divestitures; uncertainty of reserve estimates; uncertainty of estimates and projections relating to future production, costs and expenses; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; health, safety and environmental risks and risks related to weather such as hurricanes and other natural disasters; uncertainties as to the availability and cost of financing; fluctuations in oil and natural gas prices; risks associated with derivative positions; inability to timely integrate and realize expected value from acquisitions, inability of our management team to execute plans to meet our goals; shortages of drilling equipment, oil field personnel and services; unavailability of gathering systems, pipelines and processing facilities; and the possibility that laws, regulations or government policies may change or governmental approvals may be delayed or withheld. Additional information on these and other factors which could affect operations or financial results are included in Halcón Resources’ and GeoResources’ reports on file with the SEC. Investors are cautioned that any forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from the projections in the forward-looking statements. Forward-looking statements are based on assumptions, estimates and opinions of management at the time the statements are made. We do not assume any obligation to update forward-looking statements should circumstances or such estimates or opinions change. |
NYSE: HK Additional Information 3 PROPOSED TRANSACTION. Investors and security holders may obtain these documents free of charge at the SEC’s website at www.sec.gov. In addition, the documents filed with the SEC by Halcón Resources can be obtained free of charge from Halcón Resources’ website at www.halconresources.com. The documents filed by GeoResources can be obtained free of charge from GeoResources’ website at www.georesourcesinc.com. Halcón Resources and GeoResources intend to file materials relating to the transaction with the SEC, including a registration statement of Halcón Resources, which will include a prospectus of Halcón Resources and a joint proxy statement of Halcón Resources and GeoResources. The definitive joint proxy statement/prospectus will be mailed to stockholders of Halcón Resources and GeoResources. INVESTORS AND SECURITY HOLDERS ARE URGED TO CAREFULLY READ THE REGISTRATION STATEMENT AND THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT HALCÓN RESOURCES, GEORESOURCES AND THE Halcón Resources, GeoResources and their respective executive officers and directors may be deemed to be participants in the solicitation of proxies from the stockholders of Halcón Resources and GeoResources in respect of the proposed transaction. Information regarding Halcón Resources' directors and executive officers is available in its annual report on Form 10-K for the year ended December 31, 2011, which was filed with the SEC on March 5, 2012, and its proxy statement for its 2012 annual meeting of stockholders, which was filed with the SEC on April 12, 2012, and information regarding GeoResources' directors and executive officers is available in its proxy statement for its 2011 annual meeting of stockholders, which was filed with the SEC on April 29, 2011. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint proxy statement/prospectus and other relevant materials to be filed with the SEC when they become available. We use the terms “resource potential” and “EURs” per well in this presentation to describe estimates of potentially recoverable hydrocarbons that the SEC rules prohibit from being included in filings with the SEC. These are based on the Company’s internal estimates of hydrocarbon quantities that may be potentially discovered through exploratory drilling or recovered with additional drilling or recovery techniques. These quantities do not constitute “reserves” within the meaning of the Society of Petroleum Engineer’s Petroleum Resource Management System or SEC rules. “EUR,” or Estimated Ultimate Recovery, refers to our management’s internal estimates based on per well hydrocarbon quantities that may be potentially recovered from a hypothetical future well completed as a producer in the area. Management estimated these EURs based on publicly available information relating to the operations of producers who are conducting operating in these areas. Factors affecting ultimate recovery include our ability to acquire the acreage we are targeting and the scope of our ongoing drilling program, which will be directly affected by the availability of capital, drilling and production costs, availability of drilling services and equipment, drilling results, lease expirations, transportation constraints, regulatory approvals and other factors; and actual drilling results, including geological and mechanical factors affecting recovery rates. Estimates of resource potential, per well EUR may change significantly as the Company pursues acquisitions. In addition, our production forecasts and expectations for future periods are dependent upon many assumptions, including estimates of production decline rates from existing wells and the undertaking and outcome of future drilling activity, which may be affected by significant commodity price declines or drilling cost increases. |
NYSE: HK Announcing the Acquisition of GEOI by HK Consideration ($37.97 per GEOI share ): $20.00 in cash 1.932 HK shares Total transaction value ~$1.0 Billion GEOI stockholders to own ~18% of HK at closing Expected to close in 3Q12, subject to customary approvals 4 (1) Based on the closing price of Halcón Resources’ common stock on April 24, 2012. (1) (1) |
NYSE: HK 5 Liquids-Rich Asset Base and Significant Drilling Inventory Utica/Point Pleasant Wilcox Woodbine Mississippian Lime Bakken Austin Chalk Eagle Ford 3 Exploratory Liquids-Rich Plays Not Shown Note: Estimated proved reserves and PV10 at 12.31.11 using SEC pricing including GeoResources’ management estimates of 12.31.11 proved reserves associated with Brookeland field acquisition using SEC pricing. PF Total Proved Reserves: 52.8 MMBoe PF % Developed: 68% PF % Oil/NGLs: 69% PF 4Q11 Avg. Net Daily Production: 11,070 Boe PF Total Proved PV10: $1,044.9 MM |
NYSE: HK 6 Numerous “oily” resource style high growth assets Multi-decade drilling inventory Improves commercial opportunity set Immediately accretive to discretionary cash flow, production and reserves on a per share basis More than doubles HK proved reserves and production Pro forma 52.8 MMBoe of estimated proved reserves Pro forma 11.1 MBoe/d of 4Q11 production More than doubles HK estimated 2012 cash flow Strong balance sheet Increases public float Increases debt capacity Scale Capital Access Resource Intensity Accretive To Shareholders Creating a Resource Powerhouse |
NYSE: HK Substantial Increase in Production and Reserves +151% +171% +151% (1) (1) (2) 69% Liquids (1) Includes GeoResources’ Brookeland field acquisition. (2) Proved reserves at 12.31.11 using SEC pricing including GeoResources’ management estimates of 12.31.11 proved reserves associated with Brookeland field acquisition using SEC pricing; proved reserve figures exclude approximately 1.2 MMBoe (96% gas) of proved reserves and $11 MM of PV10 associated with GP interest in partnerships with GE. 7 |
NYSE: HK 48% gas (6:1) Allows for added focus on growth areas Expect some sales in 2012 Source of additional liquidity 8 Pro Forma Non-Core Divestiture Candidates (1) Estimated proved reserves and PV10 at 12.31.11 using SEC pricing. 2011 Average Net Daily Production Proved Reserves (1) Boe/d Full Year 4Q11 Oil MBbls Gas MMcf NGL MBbls Equiv. Mboe % Oil/NGLs % PD % Total PF Reserves PV10 (1) ($MM) % Total PF PV10 Permian 322 322 1,205 2,087 44 1,597 78% 72% 3% $46.3 4% South Texas 865 732 317 21,246 1,280 5,139 31% 42% 10% $48.3 5% South Louisiana 1,146 1,235 3,725 14,499 0 6,141 61% 70% 12% $142.0 14% Other 1,364 1,371 3,581 19,765 365 7,240 55% 92% 14% $131.4 13% Total 3,697 3,660 8,828 57,597 1,690 20,117 52% 71% 38% $367.9 35% |
NYSE: HK 9 Increased Capitalization (1) As of 12.31.11 the borrowing base under the revolving credit facility was $150 MM; adjusted to $225 MM after the 2.8.12 recap and adjusted to estimated $475 MM post GeoResources acquisition; assumes all outstanding GeoResources borrowings paid off. (2) GeoResources balance sheet pro forma for Brookeland field ($40.4 MM) and Bakken ($12.7 MM) acquisitions funded on revolver. (3) Reflects $275 MM five-year convertible Note issued 2.8.12 to HALRES LLC (formerly Halcón Resources LLC); Note is reflected at fair value. (4) Includes 73.3 MM common shares, 4,444 preferred shares automatically converted into 44.4 MM common shares, issuance costs and change in control payments. (5) Reflects equity consideration (51.4 million shares) for GeoResources acquisition at Halcón’s closing price of $9.30/share on 4.24.12. HK Recap GEOI Merger HK + GEOI ($000s) 12.31.11 Adjustments 12.31.11 Adjustments PF 12.31.11 Debt Revolving Credit Facility (1)(2) 127,000 (127,000) 53,100 (53,100) - Term Loan 75,000 (75,000) - - - 8.00% Sr. Conv. Note due 2017 (3) - 248,961 - - 248,961 Total Debt $202,000 $53,100 $248,961 Shareholders’ Equity (4) 5,948 669,736 368,311 - 1,043,995 New Equity (5) - - - 478,219 478,219 Total Capitalization $207,948 $421,411 $1,771,175 |
NYSE: HK 10 Solid Liquidity to Fund Growth (1) Includes cash consideration for acquisition, payoff of outstanding balance on GeoResources credit facility, change in control payments and estimated transaction fees/expenses. (2) Reflects new revolving credit facility with estimated $475 MM borrowing base post GeoResources acquisition. HK Recap GEOI Merger HK + GEOI ($000s) 12.31.11 Adjustments 12.31.11 Adjustments PF 12.31.11 Cash and Cash Equivalents 49 710,342 39,144 (611,391) (1) 138,144 Revolving Credit Facility 150,000 75,000 180,000 70,000 475,000 (2) Borrowings (127,000) 127,000 (53,100) 53,100 - Total Liquidity $23,049 $166,044 $613,144 |
NYSE: HK 11 Bakken Project Area Overview 55,000 net acres (37,000 operated) 50+ MMBoe of unbooked resource potential NW Williams County (operated) 2 rigs running 20-24 gross wells planned for 2012 (~30% - ~35% W.I.) Eastern Montana (operated) Rig to begin drilling in May 3-5 gross wells planned for 2012 (~45% W.I.) 2-3 conventional prospects to be drilled in 2012 Non-operated programs 3-4 rigs running in Mountrail County area with very strong economics (~8% W.I.) 1 rig running in McKenzie Line area (~11% W.I.) Diversified Footprint Across Bakken Trend (1) (1) Estimate is based on 320 acre spacing and excludes developed acreage on which proved reserves are already booked. Excludes Three Forks potential. See Additional Information on page 3. |
NYSE: HK 12 Bakken Operated Project Area Economics and Upside Potential for increased drilling density (i.e. 4-6 wells per 1280 acre unit) Three Forks formation potential Improved frac efficiency expected Multiple initiatives underway to lower D&C, operating costs and improve recoveries Pad development, walking rigs Company owned SWD wells Infrastructure being developed Base Case Returns (300 Mboe) (1)(2) (1) Dry gas price held constant at $4.50/Mcf. (2) EUR refers to GeoResources’ management internal estimates of reserves potentially recoverable from successful drilling of wells and may change as more data becomes available as well as our actual results of drilling and production. See Additional Information on page 3. |
NYSE: HK 13 Eagle Ford Project Overview 24,000 net acres (operated) 50+ MMBoe of unbooked resource potential 2 rigs running (3 to be added in 2H12) 20-24 gross operated wells planned for 2012 (~45% W.I.) Geology similar to area being developed by offset operators to the south Eagle Ford Acreage Position EOG PVA MHR (1) Estimate is based on 150 acre spacing and excludes developed acreage on which proved reserves are already booked. See Additional Information on page 3. (1) rd |
NYSE: HK 14 Eagle Ford Project Economics and Upside Continued refinement of optimal completion methodology Potential for increased drilling density (i.e. 80 or 120 acre spacing) Austin Chalk potential (unconventional/conventional) Potential to lower costs and improve recoveries Base Case Returns (325 Mboe) (1)(2) (1) Dry gas price held constant at $4.50/Mcf. (2) EUR refers to GeoResources’ management internal estimates of reserves potentially recoverable from successful drilling of wells and may change as more data becomes available as well as our actual results of drilling and production. See Additional Information on page 3. |
NYSE: HK 15 Eagle Ford Project Improvements First three well completions largely ineffective Laterals 3200’-5900’ with 10-16 frac stages 40/70 white sand (embedment issues) Slick water, linear gels and cross link frac fluids Recent six wells Targeting 5000’ laterals with 20 frac stages 20/40 and 30/50 resin coated and white sand Cross link gel All six still flowing up 5.5” frac string Performing significantly above 325 Mboe type curve |
NYSE: HK 16 2012 Pro Forma D&C, Seismic and Infrastructure Estimate Note: Capital budget subject to revision; property and leasehold acquisitions not budgeted. By Category By Area Drilling and Completions 78% Seismic 9% Infrastructure 13% Total ~$620 MM Utica/Point Pleasant 9% Woodbine 8% Wilcox 8% Mississippi Lime 9% Bakken 17% Eagle Ford 16% Austin Chalk 1% Exploratory Liquids Plays 11% Infrastructure 13% Other 8% Total ~$620 MM |
NYSE: HK 17 2012 Operating and Financial Guidance Summary Note: Pro forma combined guidance under review; guidance is forward-looking information that is subject to a number of risks and uncertainties, many of which are beyond the Company’s control. HK GEOI Production Total (Boe/d) 6,161- 6,270 7,300 – 8,300 Percent Oil & NGLs 70% 65-70% Operating costs and expenses ($ per Boe) UNDER REVIEW |
NYSE: HK 18 Building An Oil Company (1) Percentage leased, optioned or under contract compared to midpoint of target acreage range. Targeted Net Acres Progress First Spud Targeted Areas Utica / Point Pleasant 150,000 - 250,000 ~50% May Woodbine 150,000 - 250,000 ~35% May Wilcox 50,000 - 100,000 ~30% June Mississippian Lime 50,000 - 100,000 ~60% April Total Targeted Areas 400,000 - 700,000 ~42% 3 Exploratory Liquids Rich Plays 225,000 - 375,000 Not Disclosed Play 1 25,000 - 75,000 May Play 2 100,000 - 150,000 June Play 3 100,000 - 150,000 June (1) - |
NYSE: HK 19 Utica/Point Pleasant Overview PA OH KY NY Utica/Point Pleasant WV MD VA Utica/Point Pleasant HK Target Acreage Area Target Acreage: 150,000 – 250,000 Focus – volatile oil and liquids-rich window Access to cores, geochem and logs 3D seismic to optimize completions and reduce costs Wells could be as prolific as Eagle Ford wells Source: Industry research. |
NYSE: HK 20 Utica/Point Pleasant Thickness and Reservoir Quality Comparison Source: Citi and W.D. Von Gonten & Co. Point Pleasant Thins as Utica Thickens and Reservoir Parameters Improve - 100’ - 300’ - 200’ - 0’ N. Coast Energy C. Shaney #1 Harrison Co. (near Buell 8H Well) Newstar Energy Toalston #1 Carroll Co. (near Mangun 8H Well) D&M Lark #1 Mercer Co. 24 miles 48 miles A A’ Cross Section |
NYSE: HK 21 Utica/Point Pleasant Volatile Condensate Single Well Type Curve Oil: EUR 150-250MBO NGL: EUR 275-325MBNGL Gas: EUR 4-5BCF Play: Utica/Point Pleasant Estimated Avg. Well Cost: $6.5-$7.5 MM Estimated EUR: 1,250 MBoe Target Acreage: 150,000-250,000 acres Est. Spud-to-Production: 90 days Rig Count Estimate: 2Q12: 1 2H12: 2 Wells Planned: 2012: 8-10 Note: Internal estimates based on third party data. Company has not drilled in this play. Individual well results will differ. EUR estimate based upon available data and may change as more data becomes available as well as our actual results of drilling and production. See Additional Information on page 3. |
NYSE: HK 22 Woodbine Overview TX Woodbine HK Target Acreage Area Woodbine Target Acreage: 150,000 – 250,000 Upper Cretaceous section ~40% silica and clastics = deliverability Regional studies indicate: 10%+ porosity Current IP’s 3-4x higher vs. recent past Geologically analogous to the Eagle Ford in South Texas Horizontal drilling and completion techniques are a game changer Premium pricing for oil, NGLs and gas Source: Industry research. |
NYSE: HK 23 Woodbine Hydrocarbon System 23 Deltaic depositional system Woodbine sands charged with Eagle Ford sourced oil Multiple Woodbine sand lenses 6,500’- 11,500’ depth Play 1: High porosity, high storage capacity sands Play 2: Downdip, permeability trapped sands Eagle Ford Buda Woodbine Woodbine Isopach Source: Internal research. |
24 Woodbine Single Well Type Curve Oil: EUR 350-450MBO NGL: EUR 25-35MBNGL Gas: EUR 200-300MMCF NYSE: HK Play: Woodbine Estimated Avg. Well Cost: $5.5-$6.5 MM Estimated EUR: 467 MBoe Target Acreage: 150,000-250,000 acres Est. Spud-to-Production: 60-90 days Rig Count Estimate: 2Q12: 1 2H12: 2 Wells Planned: 2012: 10-15 Note: Internal estimates based on third party data. Company has not drilled in this play. Individual well results will differ. EUR estimate based upon available data and may change as more data becomes available as well as our actual results of drilling and production. See Additional Information on page 3. |
NYSE: HK 25 Wilcox Overview LA Southwest LA Wilcox HK 3D Shoot in Progress Source: Industry research. Oil-prone reservoir with significant associated gas and NGLs Production rate limits and commingling restrictions removed from Louisiana regulations 3D seismic essential to success 100 sq. mile 3D shoot in progress 36 sq. miles of existing 3D to be merged Responsive to multi-stage hydraulic fracturing Premium pricing LSS & high BTU gas Target Acreage: 50,000 – 100,000 |
NYSE: HK 26 Wilcox Log Section Source: Industry research. Eocene age tight sandstones Target depths range from 8,500’-15,000’ Focus - Middle and Lower Wilcox (11,000’-15,000’) Structurally controlled hydrocarbon accumulation Vertical wells Multi-stage fracs Upper Wilcox Middle Wilcox Lower Wilcox Bivens N. Bivens N. Bancroft 18.2 MMBO 6.4 BCFG Bearhead Creek S. Bearhead Creek Fields W. Gordon 7.7 MMBO 32 BCFG Neal Quicksand Creek Bon Weir 29 MMBO 37 BCFG |
NYSE: HK 27 Wilcox Single Well Type Curve Oil: EUR 150-250MBO NGL: EUR 100-200MBNGL Gas: EUR 1-2BCF Play: Wilcox Estimated Avg. Well Cost: $7.5-$8.5 MM Estimated EUR: 510 MBoe Target Acreage: 50,000-100,000 acres Est. Spud-to-Production: 60-90 days Rig Count Estimate: 2Q12: 1 2H12: 1 Wells Planned: 2012: 4-6 Note: Internal estimates based on third party data. Company has not drilled in this play. Individual well results will differ. EUR estimate based upon available data and may change as more data becomes available as well as our actual results of drilling and production. See Additional Information on page 3. |
NYSE: HK 28 Mississippian Lime Overview KS OK Mississippian Lime HK Acreage Mississippian Lime Target Acreage: 50,000 - 100,000 (1) Initially developed using vertical wells Carbonate reservoir (high permeability) Predominately oil production Shallow drilling depths (4,000’- 6,000’) 200’- 500’ gross thickness Technology reinvigorating the play Scalability and repeatability Commercial results from offset operators Recent internal technical evaluation reinforces enthusiasm for the play Source: Industry research. (1) HK currently holds a concession for 45,280 gross/net acres. |
29 Mississippian Lime Log Section Chat High porosity (20-30%) High permeability Associated with karsting High fluid volumes Dense limestone High porosity tripolitic chert lenses embedded within the low porosity/permeability dense Horizontal wells with multi- stage fracs connect high porosity lenses Source: W.D. Von Gonten & Co. NYSE: HK |
NYSE: HK 30 Mississippian Lime Single Well Type Curve Oil: EUR 100-150MBO NGL: EUR 20-30MBNGL Gas: EUR 300-350MMCF Play: Mississippian Lime Estimated Avg. Well Cost: $2.5-$3.5 MM Estimated EUR 175 MBoe Target Acreage: 50,000-100,000 acres Est. Spud-to-Production: 60-90 days Rig Count Estimate: 2Q12: 1 2H12: 2 Wells Planned: 2012: 8-10 Note: Internal estimates based on third party data. Company has not drilled in this play. Individual well results will differ. EUR estimate based upon available data and may change as more data becomes available as well as our actual results of drilling and production. See Additional Information on page 3. |
NYSE: HK Exploratory Liquids Rich Plays - undisclosed Targeting 225,000 – 375,000 acres in aggregate Two unconventional plays (100,000 – 150,000 acres each) One conventional play (25,000 – 75,000 acres) Will drill in all three plays in 2012 8-12 wells Oil and liquids-rich targets Prospect identification driven by technical analysis and experience Due to competitive concerns, not disclosing details at this time 31 |
NYSE: HK Investment Highlights Proven Management Team With Significant Ownership Stake Proven Management Team With Significant Ownership Stake Technical Bias With Extensive Resource Play Experience Technical Bias With Extensive Resource Play Experience Attractive Liquids-Rich Asset Portfolio With Compelling Economics Attractive Liquids-Rich Asset Portfolio With Compelling Economics Positioned For Significant Near-Term Reserve And Production Growth Positioned For Significant Near-Term Reserve And Production Growth Excellent Track Record For Managing Cash Margin – Excellent Track Record For Managing Cash Margin – The “Best Hedge” The “Best Hedge” Solid Balance Sheet And Liquidity To Fund Growth Solid Balance Sheet And Liquidity To Fund Growth 32 |
NYSE: HK “Oily” (69% Liquids) Strong growth profile (+25% in 2012) Adds two established liquids rich resource plays Austin Chalk potential Solid production base Immediately accretive New HK shareholders 33 HK to Acquire GEOI |
Appendix |
NYSE: HK 35 Pro Forma Production and Reserves (69% Liquids) 2011 Average Net Daily Production Proved Reserves (1) Boe/d Full Year 4Q Oil MBbls Gas MMcf NGL MBbls Equiv. Mboe % Oil/NGLs % PD % Total Reserves PV10 (1) ($MM) % Total PV10 Resource Style Bakken 1,560 1,998 6,264 3,040 273 7,044 93% 59% 13% $183.9 18% Eagle Ford 106 176 890 349 69 1,017 94% 17% 2% $16.4 2% Austin Chalk 2,412 2,581 1,279 34,987 1,293 8,403 31% 68% 16% $99.0 9% 4,078 4,755 8,433 38,376 1,635 16,464 61% 61% 31% $299.3 29% Conventional Electra/Burkburnett 1,329 1,325 5,889 - 328 6,217 100% 65% 12% $151.5 15% Fitts-Allen 826 822 4,916 1,437 79 5,235 95% 74% 10% $129.4 12% South Texas 865 732 317 21,246 1,280 5,139 31% 42% 10% $48.3 5% South Lousiana 1,146 1,235 3,725 14,499 - 6,141 61% 70% 12% $142.0 14% Permian 322 322 1,205 2,087 44 1,597 78% 72% 3% $46.3 4% Other 1,793 1,879 8,166 20,852 365 12,007 71% 85% 23% $228.0 22% 6,282 6,315 24,219 60,121 2,096 36,335 72% 71% 69% $745.5 71% Total 10,360 11,070 32,652 98,497 3,731 52,799 69% 68% 100% $1,044.9 100% % Increase vs. HK Stand-Alone 151% 171% 164% 146% 86% 151% 1% 6% 167% (1) Estimated proved reserves and PV10 at 12.31.11 using SEC pricing including GeoResources’ management estimates of 12.31.11 proved reserves and PV10 associated with Brookeland field acquisition using SEC pricing. Note: Production figures are pro forma to include GeoResources’ Brookeland field acquisition; proved reserve and PV10 figures exclude approximately 1.2 MMBoe (96% gas) of proved reserves and $11 MM of PV10 associated with GP interest in partnerships with GE. |
NYSE: HK 36 Pro Forma Derivative Summary *Weighted averaged price FY 2012 FY 2013 FY 2014 OIL OIL OIL Volume (Bbls) Ceiling / Swap Price* Floor Purchased* Floor Sold* Volume (Bbls) Ceiling / Swap Price* Floor Purchased* Floor Sold* Volume (Bbls) Ceiling / Swap Price* Floor Purchased* Floor Sold* Three-Way Collars 400,500 $104.89 $87.11 $70.00 251,075 $100.60 $95.18 $70.00 280,500 $99.59 $95.00 $70.00 Collars 419,300 $105.85 $84.42 350,875 $100.04 $95.00 - - - - Swaps 660,000 $98.62 - - 360,000 $102.18 - - - - - - Puts - - - - - - - - - - - - GAS GAS GAS Volume (MMBtu) Ceiling / Swap Price* Floor Purchased* Floor Sold* Volume (MMBtu) Ceiling / Swap Price* Floor Purchased* Floor Sold* Volume (MMBtu) Ceiling / Swap Price* Floor Purchased* Floor Sold* Three-Way Collars - - - - - - - - - - - - Collars 915,000 $6.00 $4.00 - - - - - - - - - Swaps 1,720,000 $5.15 - - 465,000 $4.18 - - - - - - Puts 609,700 - $4.35 - - - - - - - - - Total (Boe) 1,918,967 1,039,450 280,500 Total (Boe/d) 5,243 2,848 768 |
NYSE: HK $550 Million Recap (1) Halcón/RAM Transaction Summary 37 Ticker change to HK (effective 2.9.12) Reverse stock split (1:3) (effective 2.10.12) New credit facility with undrawn borrowing base of $225 million $275 million common equity $275 million convertible note 36.7 million warrants Why RAM Energy Resources? Solid platform Concentrated ownership Oil levered Simple balance sheet Attractive valuation New Senior Management and Board Stock Listing Modifications (1) Common equity issued at $3.75 per share; convertible note yields 8% with a 5 year term and is convertible at $4.50 per share after February 8, 2014; warrants exercisable at $4.50 per share; Investor group partnering with Halcón management includes EnCap Investments L.P., Liberty Energy Holdings LLC, and Mansefeldt Investment Corp. |
Contact: Scott Zuehlke, Director of Investor Relations 1000 Louisiana St., Suite 6700, Houston, TX 77002 832-538-0314 szuehlke@halconresources.com www.halconresources.com |