![]() Barclay’s CEO Energy-Power Conference September 11-12, 2013 Drilling the Permian Basin Drilling the Permian Basin 3 Bone Spring • Wolfberry • Wolfcamp • Cline rd Exhibit 99.1 |
![]() Forward-Looking Statements This presentation (including associated oral commentary) contains statements expressing expectations of future plans, objectives, and performance that constitute forward-looking statements made pursuant to the Safe Harbor Provision of the Private Securities Litigation Reform Act of 1995. Unless noted, these statements do not reflect possible or pending acquisitions, divestitures, or restructurings. Statements based on expectations are forward-looking statements that are dependent on certain events, risks, and uncertainties that could cause actual results to differ materially from those anticipated. A discussion of risks and uncertainties may be found in the Company’s periodic reports filed with the Securities and Exchange Commission (SEC). You should not place undue reliance on any of the Company’s forward-looking statements. All forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by applicable law. 1 |
![]() Oil & Gas Quantities: Cautionary Statement The SEC permits oil and gas companies to disclose in SEC filings only proved, probable, and possible reserves that meet the SEC’s definitions for such terms, and price and cost sensitivities for such reserves, and prohibits disclosure of resources that do not constitute such reserves. Outside SEC filings, the Company uses the terms “estimated ultimate recovery” or “EUR,” reserve or resource “potential,” and other descriptions of volumes of reserves potentially recoverable through additional drilling or recovery techniques. These estimates are inherently more speculative than estimates of proved, probable, and possible reserves and are subject to substantially greater risk of actually being realized by the Company. EUR estimates, potential drilling locations, and resource potential estimates have not been risked by the Company. Actual locations drilled and quantities that may be ultimately recovered from the Company’s interest may differ substantially from the Company’s estimates. There is no commitment by the Company to drill all of the drilling locations that have been attributed these quantities. Factors affecting ultimate recovery include the scope of the Company’s ongoing drilling program, which will be directly affected by the availability of capital, drilling, and production costs, availability of drilling and completion services and equipment, drilling results, lease expirations, regulatory approval, and actual drilling results, as well as geological and mechanical factors. Estimates of unproved reserves, type/decline curves, per-well EUR, and resource potential may change significantly as development of the Company’s oil and gas assets provides additional data. 2 |
![]() Energen Investment Highlights 3 Domestic asset base High exposure to oil and NGL from 3P reserves Large resource potential in Midland and Delaware basins Permian Basin exploration Permian Basin development Double-digit oil and NGL production growth Excellent hedges help protect cash flows Strong balance sheet and financial capacity Wolfcamp (horizontal) Cline (horizontal) Wolfberry (vertical) 3rd Bone Spring (horizontal) |
![]() Energen Profile 4 TX Other: 7 MMBOE (1%) San Juan Basin: 339 MMBOE (46%) Permian Basin: 389 MMBOE (53%) Farmington Arcadia CO Birmingham 3P Reserves at YE12 by Area (excluding BWB assets) Midland LA NOTE: All data is as of YE12, (unless otherwise noted); YE12 and YE13e data have been restated to exclude Black Warrior Basin assets NYSE: EGN Shares Outstanding (6.30.13) 72.2 MM Market Cap (9.5.13) 4.9 B Adjusted EBITDA (Non-GAAP) 801.8 MM 2013e Total Debt 1.8 B Enterprise Value (9.5.13) 6.7 B PV10 Pre-tax 4.4 B 2013e Debt-to-Total Cap 39% Reserves at YE12 (excluding BWB assets): Proved Reserves 330.2 MMBOE Probable Reserves 113.9 MMBOE Possible Reserves 290.9 MMBOE Total 3P Reserves 735.0 MMBOE % Oil & NGL 57% Production from continuing operations: $ $ $ $ $ 2012 2013e MMBOE MMBOE 22.0 24.3-24.7 |
![]() Double-Digit Liquids Production Growth 5 16.6 18.4 22.0 24.5 Liquids production expected to double from 2010 to 2013 Wolfberry, 3 rd Bone Spring drive 2013 production growth (MMBOE) (MMBOE ) * Includes 0.1 MMBOE and 0.5 MMBOE in Midland and Delaware basins, respectively, for Wolfcamp production NOTE: Production from continuing operations 1.9 2.2 2.6 3.5 10.6 8.8 6.3 5.1 9.6 9.9 10.6 10.4 2010 2011 2012 2013e Midpoint Gas Oil NGL Midland Basin* Delaware Basin* Central Basin San Juan Basin Other 2011 2012 2013e Midpoint 2.3 3.5 5.4 0.6 2.9 4.9 4.9 4.8 4.3 9.6 9.9 9.3 1.0 0.9 0.6 |
![]() 2013e E&P Capital, Drilling Plans 6 Permian Basin Wolfcamp 9 net wells Wolfcamp 10 net wells * Includes 2 net injector wells Midland Basin Wolfberry Delaware Basin 3 Bone Spring 30 net wells 124 net wells Other Permian 80 net wells* 9% 3% 46% 42% Midland Basin - $460 MM Delaware Basin - $425 MM Central Basin - $85 MM San Juan/Other - $30 MM Capital Investment: $1,000 MM Permian Development : $775 MM Permian Exploration: $195 MM San Juan /Other: $ 30 MM rd |
![]() $740 $760 $802 $907- $937 Energen After-Tax Cash Flows 7 ($MM) E&P estimated development capital of $805 MM approximates 2013e after- tax cash flows from all operations Approximately $160 million in proceeds from sale of Black Warrior Basin assets will help offset estimated exploration capital of $195 MM NOTE: From all operations $30 Utility BWB E&P E&P Range $62 $49 $30 $20 $110 $119 $103 $101 $568 $592 $669 $786 2010 2011 2012 2013e |
![]() 2013 Guidance 8 Exploration & Production Sensitivity to Commodity Prices NOTE: From continuing operations Assumed prices unhedged volumes: $4.00 gas • $90 oil • 86¢ NGL Est. E&P expenses/BOE: LOE: $ 11.45 - $ 11.65 Prod. Taxes $ 2.70 - $ 2.80 DD&A: $ 19.15 - $ 19.55 G&A: $ 4.10 - $ 4.30 Interest : $ 2.15 - $ 2.25 Assumed unhedged basis differentials, July-December WTI Mid-Cushing $ 0.50 WTS Mid-Cushing $ 1.00 Gas basis $ 0.20 $400,000 for every $1 change from $90/barrel OIL NGL GAS $450,000 for every 1¢ change from 86¢ /gallon $200,000 for every 10¢ change from $4.00/Mcf |
![]() CY2013e cash cost (continuing operations): CY2013e net income break-even (continuing ops): $19.00/barrel $38.50/barrel Hedges Minimize Price Risk 9 WTS Midland to WTI Cushing: 1.8 MMBO @ $3.00 WTI Midland to WTI Cushing: 2.1 MMBO @ $1.00 2H2013e CY2014e * Basin-specific hedges converted to NYMEXe price by adding to them assumed San Juan and Permian basis differentials of 20¢/Mcf in 2013 and 2014. Unhedged Gas Unhedged Oil Unhedged NGL Hedged Gas Hedged Oil Hedged NGL 27% NGL Hedged at $1.02 85% Gas Hedged at NYMEXe $4.64 84% Oil Hedged at NYMEXe $91.47 2H2013e Hedged Volumes Hedge % (based on estimated production midpoint from continuing operations) Average Price* Oil NGL Gas 4.8 MMBO 23.4 MMgal 27.3 Bcf 84% 27% 85% $ $ $ 91.47 1.02 4.64 Hedge Volumes Average Price* $ $ 92.64 4.60* MMBO Bcf 9.8 51.8 Oil Gas 73% of 2H2013e production hedged |
![]() 3P Reserves Total 735 MMBOE (Adjusted) 10 Proved Reserves by Product (Excludes Black Warrior Basin assets) 232 277 320 330 3P Reserves by Area @ YE12 (Excludes Black Warrior Basin assets) Midland Basin Delaware Basin San Juan Basin Other Resource Potential Not Included Midland Basin Delaware Basin Wolfberry downspacing Wolfcamp Shale Cline Shale Avalon Shale Wolfcamp shale* * 100 net locations based on 160-acre spacing and 4,400’ lateral lengths included in YE12 possible reserves 56 54 41 30 78 103 130 155 119 136 133 124 2009 2010 2011 2012 Gas Oil NGL ($MM) 1% 26% 6% 21% 46% Central Basin |
![]() 11 Permian Overview Legacy Assets Major Acquisitions, 2009-12 Gaines Dawson Borden Mitchell Irion Sterling Glasscock Reagan Upton Midland Martin Howard Andrews Yoakum Northwest Shelf Northwest Shelf Eastern Eastern Shelf Shelf Diablo Platform Diablo Platform Marathon Ouachita Fad Belt Marathon Ouachita Fad Belt Winkler Ward Loving Reeves Eddy Lea NEW MEXICO TEXAS Ozona Arch Ozona Arch Total net acres: 300,000 $1B in acquisitions, 2009-12 Midland Basin Wolfberry (V) Wolfcamp shale (H) Cline (H) Delaware Basin 3 Bone Spring (H) Wolfcamp shale (H) Avalon shale (H) Central Basin Platform: San Andres (V) Waterfloods (V) Cline Play Wolfberry Play Wolfcamp Play Wolfcamp Play 3 Bone Spring Focus Area rd rd Central Central Basin Basin Platform Platform Delaware Basin Delaware Basin Midland Basin Midland Basin |
![]() 12 Gaines Borden Andrews Martin Howard Midland Upton Reagan Sterling Coke Tom Green Glasscock Dawson Mitchell Irion Coke Scurry Tom Green Midland Basin Slick water stimulations Northern wells drilled to Mississippian Atoka Barnett Mississippi Lime Horizontal potential 63,000 net acres 27,000 net undeveloped acres 670 potential locations (40-acre spacing) 670 potential locations (20-acre infill) NOTE: Energen acreage in yellow 2Q13 2-Stream Results (62 net wells tested) Avg. Peak 24-hr. IP : Peak 30-day Avg.: 114 boepd (78% oil) 96 boepd (78% oil) WOLFBERRY (VERTICAL) Vertical Wolfberry: Rust Outline |
![]() Average Wolfberry Type Curve 13 NOTE: Based on slick water type curves and mix of 670 net well inventory EUR: 190 MBOE Working Interest: 100% Net Revenue Interest: 75% Drill & complete cost: Post-plant product mix: 31% ROR (pre-tax) $100/barrel $4/MMBtu 40% realizations (NGL) 40-acre spacing 6-8 frac stages 160 140 120 100 80 60 40 20 0 0 6 12 18 24 30 36 42 48 54 60 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 $2.5 MM 60% oil/24% NGL/16% gas Months |
![]() Midland Basin 14 Gaines Dawson Borden Andrews Martin Howard Midland Upton Reagan Mitchell Irion Sterling Scurry Glasscock NOTE: Energen acreage in yellow Lavaca 38 #101H – 3-Stream Results Peak 24-hour IP: 861 boepd (60% oil) Peak 20-day Avg: 709 boepd (65% oil) Lateral length: 4,250’ Stimulation: Slick water Vertical Wolfberry: Rust Outline Cline Play: Red Outline Wolfcamp Play: Blue Outline Lavaca 38 #101H – On production Two additional Glasscock County wells completing/flowing back Progressively longer lateral lengths up to 7,500’ 100 net wells/36 MMBOE booked as possible reserves at YE12 (EUR: 460 MBOE, 4,400’ lateral length, 160- acre spacing) CLINE HORIZONTAL 87,000 net acres 1,085 potential locations (80-acre spacing) 70,000 net acres 2,005 potential locations (80-acre spacing) 9 net Wolfcamp test wells in 2013 WOLFCAMP HORIZONTAL |
![]() Midland Basin Wolfcamp, Cline Potential 15 870 70,000 800 64,000 335 27,000 1,085 87,000 Potential Wells* Net Acres 3,090 Potential Locations* * Based on 80-acre spacing 7,700’ 8,050’ 8,600’ 9,050’ 9,450’ 9,800’ Wolfcamp A Wolfcamp B Wolfcamp C Cline |
![]() 3 rd Bone Spring Type Curve EUR: 475 MBOE Working interest: 100% Net Revenue Interest: 75% Drill & complete: $6.9 MM Post-plant product mix: 66% oil/18% NGL/16% gas 66% ROR (pre-tax) $100/barrel $4/MMBtu 40% realizations (NGL) 4,400’ lateral lengths 10-11 frac stages 16 NOTE: Based on reserve type curves and remaining mix of wells in program 700 600 500 400 300 200 100 0 350 300 250 200 150 100 50 0 0 6 12 18 24 30 36 42 48 54 60 Months |
![]() Delaware Basin 17 3 BONE SPRING 2Q13 2-stream Results Avg. Peak 24-Hr. IP (10 net): 1,035 boepd (70% oil) Peak 30-day Avg.: (7 net): 695 boepd (68% oil) NOTE: Energen acreage in yellow Wolfcamp Play Rust Outline 3 Bone Spring Focus Area – Red Outline 114,000 net acres – 3,371 potential locations 10 net Wolfcamp test wells in 2013 E. J. Brady 56-1 #1H on production in Reeves Co. University 28-21 #1H on production in Winkler Co. Five wells currently in various stages of drilling/completion/flow back 30,000 net acres 7,500 net undeveloped acres 46 potential locations (160-acre spacing) WOLFCAMP rd rd Loving Reeves Ward Winkler New Mexico Texas |
![]() Loving Reeves Ward Winkler NOTE: Energen acreage in yellow Delaware Basin Wolfcamp Results 18 University 28-21 #1H University 39-17 #1H E.J. Brady 56-1 #1H Peak 24-hour IP (3 stream): 969 boepd (74% oil) Peak 30-day Avg (3 stream): 653 boepd (74% oil) Lateral length: 4,200’ Stimulation: Slick water Peak 24-hour IP (3 stream): 1,798 boepd (27% oil) 1,585 boepd (27% oil) Lateral length: 3,800’ Stimulation: Slick water Peak 24-hour IP (3 stream): Peak 20-day Avg (3 stream) 1,187 boepd (61% oil) Peak 30-day Avg (3 stream) 950 boepd (60% oil) Lateral length: 4,000’ Stimulation: Hybrid Wolfcamp Play Rust Outline |
![]() Delaware Wolfcamp Potential 7,550’ 8,450’ 9,1 00’ 9,600’ 10,600’ 11,900’ Wolfcamp A Wolfcamp B Wolfcamp C Top of Pennsylvanian Top of Delaware Mtn. Group Avalon 19 1,427 114,127 1,364 109,114 580 46,379 Potential Wells* Net Acres 3,371 Potential Locations* * Based on 80-acre spacing |
![]() Oil Price ROR Impact 20 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Bone Spring Wolfberry 40% 50% 66% 80% 19% 24% 31% 39% $80/Bbl; $4/MMBtu $90/Bbl; $4/MMBtu $100/Bbl; $4/MMBtu $110/Bbl; $4/MMBtu |
![]() San Juan Basin: Long-term Optionality HBP Oil phase 72,900 net undeveloped acres Wet gas phase 8,550 net undeveloped acres Gas phase 58,300 net undeveloped acres WPX, Encana deem “commercial” play Niobrara Shale Farmington Encana Colorado New Mexico Oil Phase Wet Gas Phase Dry Gas Phase Encana wells WPX wells 21 NOTE: Energen acreage in yellow |
![]() Annual Dividend Rate 31 Years of Dividend Growth 22 2008 2009 2010 2011 2012 2013 $0.48 $0.50 $0.52 $0.54 $0.56 $0.58 2013 dividend raised 3.6% Alagasco funds dividend at utility payout 65% ERC may make small payout contribution |
![]() Reasons to Invest in EGN 23 Liquids Focus Substantial Potential Drilling Inventory Double-digit Liquids Growth Significant Hedge Position Strong Cash Flows |
![]() ENERGEN Years Ended 12/31 ($ in millions) 2010 2011 2012 2013e Net income (GAAP) $ 291 $ 260 $ 254 $ 228 - $ 258 DD&A (including asset impairment) $ 248 $ 284 $ 441 $ 536 - $ 536 Deferred income taxes, net $ 134 $ 129 $ 124 $ 121 - $ 121 Other $ 67 $ 87 $ (17) 22 - 22 Consolidated after-tax cash flows (Non-GAAP) $ 740 $ 760 $ 802 $ 907 - $ 937 Less: AGC cash flows from operations $(110) $ (119) $ (103) $ (101) - $ (101) Adj. cash flows from ops excl. AGC (Non-GAAP) $ 630 $ 641 $ 699 $ 806 - $ 836 Note: 2013e data constitute forward-looking statements The U.S. Securities and Exchange Commission (SEC) requires public companies to reconcile Non-GAAP financial measures to related GAAP measures. GAAP refers to generally accepted accounting principles. After-tax Cash Flow (ATCF) is a Non-GAAP financial measure. Energen believes ATCF is relevant as a measure of cash available to fund its capital expenditures, dividends, debt reduction, and other investments. After-tax Cash Flow Reconciliation to GAAP 24 |
![]() ENERGEN ($MM) Year Ended 12/31/12 Net income (GAAP) $ 253.6 Interest expense $ 65.6 Income tax expense $ 143.8 Depreciation, depletion and amortization $ 419.6 EBITDA (Non-GAAP) $ 882.5 Adjustment for asset impairment $ 21.5 Adjustment for mark-to-market (gains)/losses $ (58.8) Consolidated adjusted EBITDA (Non-GAAP) $ 845.3 Black Warrior Basin EBITDA (Non-GAAP) $ 43.5 Consolidated adjusted EBITDA excluding BWB (Non-GAAP) $ 801.8 The U.S. Securities and Exchange Commission (SEC) requires public companies to reconcile Non-GAAP financial measures to related GAAP measures. GAAP refers to generally accepted accounting principles. After-tax Cash Flow (ATCF) is a Non-GAAP financial measure. Energen believes ATCF is relevant as a measure of cash available to fund its capital expenditures, dividends, debt reduction, and other investments. Adjusted EBITDA Reconciliation to GAAP 25 |
![]() Wolfcamp Potential by County 26 * Up to 12.5% of Midland Basin wells may be contingent on regulatory approval NOTE: Unrisked, 80-acre spacing, 4,400’ laterals Midland Basin* Wolfcamp A Wolfcamp B Wolfcamp C Locations Net Acres Locations Net Acres Locations Net Acres Glasscock 347 27,727 296 23,657 291 23,271 Howard 84 6,722 84 6,722 Martin 227 18,198 227 18,188 Midland 112 8,986 104 8,341 Reagan 89 7,084 80 6,377 47 3,750 Upton 11 889 8 649 Total Midland 870 69,606 799 63,934 338 27,021 Texas Delaware Basin Wolfcamp A Wolfcamp B Wolfcamp C Locations Net Acres Locations Net Acres Locations Net Acres Loving 145 11,569 145 10,913 Ward 336 26,852 336 23,747 Winkler 251 20,109 251 18,868 Total East 732 58,530 732 53,528 Reeves 695 55,597 632 46,379 580 46,379 Total TX Delaware 1,427 114,127 1,364 109,114 580 46,379 Total Permian Wolfcamp 2,297 183,733 2,163 173,048 918 73,400 |
![]() Julie S. Ryland Vice President – Investor Relations 205-326-8421 jryland@energen.com www.energen.com For More Information 27 |