Gulfport Energy (GPOR) 8-K Johnson Rice Energy Conference

th

th

Gulfport Energy Corporation

Johnson Rice Energy Conference

October

8

th

,

2009

Gulfport Energy Corporation

Gulfport Energy Corporation

Johnson Rice Energy Conference

Johnson Rice Energy Conference

October

October

8

8

th

th

,

,

2009

2009

Exhibit 99.1

This

presentation

includes

“forward-looking

statements”

within

the

meaning

of

Section

27A

of

the

Securities

Act

of

1933,

as

amended

(the

“Securities

Act”),

and

Section

21E

of

the

Securities

Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of

historical facts, included in this presentation that address activities, events or developments that

Gulfport

expects

or

anticipates

will

or

may

occur

in

the

future,

including

such

things

as

future

capital

expenditures

(including

the

amount

and

nature

thereof),

business

strategy

and

measures

to

implement strategy, competitive strength, goals, expansion and growth of Gulfport’s business and

operations, plans, market conditions, references to future success, reference to intentions as to

future matters and other such matters are forward-looking statements. These statements are based

on certain assumptions and analyses made by Gulfport in light of

its experience and its perception of

historical trends, current conditions and expected future developments as well as other factors it

believes are appropriate in the circumstances. However, whether actual results and developments

will conform with Gulfport’s expectations and predictions is subject to a number of risks and

uncertainties, general economic, market, business or weather conditions; the opportunities (or lack

thereof) that may be presented to and pursued by Gulfport; competitive actions by other oil and gas

companies; changes in laws or regulations; and other factors, many of which are beyond the control

of Gulfport. Information concerning these and other factors can be found in the company’s filings

with

the

Securities

and

Exchange

Commission,

including

its

Forms

10-K,

10-Q

and

8-K.

Consequently, all of the forward-looking statements made in this presentation are qualified by these

cautionary statements and there can be no assurances that the actual results or developments

anticipated by Gulfport will be realized, or even if realized, that they will have the expected

consequences to or effects on Gulfport, its business or operations. We have no intention, and

disclaim any obligation, to update or revise any forward-looking statements, whether as a result of

new information, future results or otherwise.

Forward-Looking Statement

Forward-Looking Statement

Forward-Looking Statement

1

Gulfport Today

Gulfport Today

Gulfport Today

Southern Louisiana

Acreage:     13,493 Net Acres

Reserves:    16.259 MMBoe

Permian Basin

Acreage:     6,724 Net Acres

Reserves:   8.395 MMBoe

Bakken

Shale

Acreage:     900 Net Acres

Canadian Oil Sands

Acreage:     127,941 Net Acres

Thailand

Acreage:     4,000,000 Gross Acres

Reserves:   3.5 Net Bcf

Gas                   

19,000 Net Bbls

Oil

Ticker:

Market Cap¹:

$342 MM

42.67 MM Shares x $8.01 Per Share

Enterprise

Value¹:

$400

MM

Map of Operations

Portfolio Highlights

•

25.5 MMBOE Net Proved Reserves at YE’08

–

Forecasted YE’09 Reserves of ~25.5 MMBOE²

–

15-Year Reserves to Production Ratio

•

2009 Forecasted Production of 1.65 to 1.75

MMBOE

–

Estimate 1.19 MMBOE produced through 9/20/09

–

Approximately 97% Oil & Liquids

Company Overview

¹

Calculated as of the close of the market on 10/2/09 at a price of $8.01 per share using 2Q’09 shares outstanding, short-term and long-term

debt, and cash and cash equivalents from the company’s second quarter 2009 financial statements

²

2009 internal reserve estimates based upon current strip pricing held constant and not new SEC pricing regulations

•

~250 Net Identified Drilling Locations²

•

Position in the Canadian Oil Sands Provides

Upside Beyond Proved Reserves

2

Key Investment Considerations

Key Investment Considerations

Key Investment Considerations

OIL

Growth

Gulfport has a diverse portfolio of oil-weighted assets

Active in Southern Louisiana and the Permian, two of America’s

most prolific oil producing basins

Long-term leases in the Canadian Oil Sands provide long-term

optionallity

in the largest oil play in the world outside Saudi Arabia

Approximately 97% oil and liquids weighted production profile

Gulfport’s large captured resource and high rate of return

opportunities drive visible growth for the foreseeable future

Multi-year drilling inventory exploitable from within cash flow

First oil sands project projected to come online in 2012, with each

subsequent project bringing the potential for significant reserve

and production growth

Track record of opportunistic acquisitions provides additional

upside

3

Balance Sheet

Balance Sheet

Balance Sheet

Declining Levels of Debt

42% reduction in debt since 9/30/08

$95.9

$70.7

$65.0

$64.8

$55.6

$0

$20

$40

$60

$80

$100

$120

09/30/08

12/31/08

3/31/09

6/30/2009

9/30/09E

ST & LT Debt

4

Not only have costs been reduced, but access to quality crews and labor has

also dramatically improved, reducing the risk for potential cost

overruns

Cost Environment

Cost Environment

Cost Environment

The combined effect of increased commodity pricing and reduced drilling and

completion costs has allowed Gulfport to resume drilling in earnest again

5

% Decrease

Mobilization/Demobilization

10,000

$    

per job

35,000

$  

per job

-71%

Drilling Costs-Daywork

19,000

$    

per day

34,000

$  

per day

-44%

Marine Services, Tugs

3,300

$      

per day

5,200

$    

per day

-37%

Directional Services

6,000

$      

per day

18,000

$  

per day

-67%

Cement & Cementing Services

60,000

$    

per job

100,000

$

per job

-40%

Completion Rig & Swab Unit

12,000

$    

per day

17,500

$  

per day

-31%

Surface Casing

19.50

$      

per foot

44.00

$    

per foot

-56%

5½

Production Casing

10.60

$      

per foot

23.00

$    

per foot

-54%

SL340 #989

SL340 #981

(June 2009)

(October 2008)

Valuing Gulfport

Valuing Gulfport

Valuing Gulfport

At year-end 2007

Gulfport’s PV-10

value was

$821 MM

based on a price

deck of $92.50 per

barrel WTI and

6.80 per MCF

Henry Hub

As of mid-year 

2009 Gulfport’s

estimates it’s    

PV-10 value to

have increased to

~$515 MM¹

based on the

current strip of

$75.00 per barrel

WTI and $5.35 per

MCF Henry Hub

$126 MM

Due to price

revisions at year-end

2008, Gulfport lost

3.0 MMBOE of

proved reserves

causing its PV-10

value to be reduced

to

$126

MM

based

on a price deck of

$41.00 per barrel

WTI and $5.71 per

MCF Henry Hub

Oil sands

provide

significant

upside

and are

completely

discounted

from

enterprise

valuation

Gulfport is highly leveraged to oil and is presently trading

at a discount to its current PV-10 value which assigns no

value to its position in the Canadian Oil Sands

Year-End 2007

Year-End 2008

Mid-Year 2009

Projected

First

Production

2012

6

Gulfport’s Oil

Sands Cost Basis

Totals ~$40 MM

¹

2009 internal reserve estimates based upon current strip pricing held constant and not new SEC pricing regulations

•

Gulfport holds an interest in

approximately 127,941 net

acres¹

of oil sands leases

•

The Canadian oil sands of

Alberta are the world’s

largest oil play outside of

Saudi Arabia with

approximately 173 billion²

barrels of oil proven to be

recoverable using today’s

technology

•

The Athabasca region of the

Canadian oil sands play

totals 10.4 MM acres and

Gulfport’s acreage¹

represents approximately

1% of the play

Gulfport in the Scope of Canada’s Oil Sands

Gulfport in the Scope of Canada’s Oil Sands

Gulfport in the Scope of Canada’s Oil Sands

7

¹

Gulfport’s position in the Canadian Oil Sands comes by way of its 24.9999% interest in Grizzly Oil Sands, ULC

²

http://oilsands.alberta.ca/519.cfm

AOSC –

PetroChina

Deal Provides Additional Valuation Metrics for Gulfport’s Acreage²

•

On August 31, 2009 Athabasca Oil Sands Crop (AOSC) and PetroChina

announced a deal

whereby PetroChina

will acquire 60% of AOSC’s

Dover and MacKay River oil sands projects

AOSC -

PetroChina

Deal

180,000 Net Acres

@

$9,650 Per Acre

=

$1.74 Billion

NO PRODUCTION

Canadian Oil Sands Acreage

Net to Gulfport’s Interest

127,941 Acres²

A large portion of Gulfport’s

acreage²

is located directly

adjacent or surrounding to the

acreage included in the       

AOSC –

PetroChina

deal

Unlocking Value in the Canadian Oil Sands

Unlocking Value in the Canadian Oil Sands

Unlocking Value in the Canadian Oil Sands

¹

AOSC –

PetroChina

acreage shown on map depicts only acreage included in the August 31, 2009 transaction and is only a portion of

AOSC’s

overall acreage in the Canadian oil sands.

²

Gulfport’s position in the Canadian Oil Sands comes by way of its 24.9999% interest in Grizzly Oil Sands, ULC

8

50 Kilometers

31.1 Miles

1

Unlocking Value in the Canadian Oil Sands (cont.)

Unlocking Value in the Canadian Oil Sands (cont.)

Unlocking Value in the Canadian Oil Sands (cont.)

AOSC - PetroChina

Acreage

Gulfport Acreage In

Direct Vicinity

Net Lease Bonuses²

~C$111 MM

~C$16 MM

Gross Core Holes Drilled by Operator

267 Core Holes

55 Core Holes

Gross Existing Well Control on Acreage

140 Wells

100 Wells

Internal Estimate of Net Original Oil In Place³

~ 3.90 Billion Bbls

~ 0.73 Billion Bbls

$/Acre from Precedent AOSC-PetroChina Trasnaction

Acreage Value

$1.7 Billion

$483 Million

$9,650

•

~50,000 acres net to 

Gulfport’s interest¹

are

located in the direct

vicinity of the        

AOSC –

PetroChina

acreage

•

This portion of

acreage has well

control from:

~278 wells on or

within 1 section of

the acreage

~578 wells on or

within 3 sections of

the acreage

•

Internal

estimates³

of

original oil in place on

its acreage in direct

vicinity of the   AOSC-

PetroChina

acreage

represents 19% of the

net original oil in place

sold in the AOSC-

Petrochina

deal

¹

Gulfport’s position in the Canadian Oil Sands comes by way of its 24.9999% interest in Grizzly Oil Sands, ULC

²

AOSC –

PetroChina

acreage shown on map depicts only acreage included in the August 31, 2009 transaction

³

Grizzly’s

internal

estimate

of

OOIP

net

to

the

AOSC-PetroChina

60%

joint

venture

and

Gulfport’s

24.9999%

proportionate

interest.

Isopach

map and OOIP estimates are the products of Grizzly’s internally generated estimates and assumptions

9

1,2,3

Canadian Oil Sands Historical M&A

Canadian Oil Sands Historical M&A

Canadian Oil Sands Historical M&A

10

Announcement

Transaction

Working Interest

Transaction

Acquiror

Seller

Target

Date

Value

Lease Size

Value

US$mm

Acres

$/acre

Pettrochina

Athabasca Oil Sands

60% of Company

8/31/2009

$1,737

180,000

$9,650

Nexen

OPTI Canada

15% Long Lake

12/17/2008

$735

38,880

$18,904

& Future Developments

Occidental Petroleum

Enerplus Resources

15% Joslyn Project

6/23/2008

$500

n/a

n/a

Total

Synenco

Synenco

4/28/2008

$381

50,100

$7,605

B.P.

Husky

Sunrise J.V.

12/5/2007

$1,163

42,000

$27,679

Petro Canada /

UTS Energy

10% of Ft. Hills

9/19/2007

$740

5,982

$123,709

Teck Cominco

Marathon

Western Oil Sands

Company

7/31/2007

$6,200

73,561

$84,284

MEG

Paramount

Surmont

5/31/2007

$281

7,680

$36,536

Petrobank

Minority Owner

16% Whitesands stake

5/14/2007

$108

6,349

$16,980

Statoil

NAOSC

Company

4/26/2007

$2,000

257,200

$7,776

Teck Cominco

UTS Energy

50% of Lease 14

4/19/2007

$177

3,574

$49,559

Enerplus

Kirby Oil Sands Partnership

90% of Company

3/22/2007

$158

39,024

$4,041

Conoco

Encana

Christina Lake/Foster

10/5/2006

$2,800

380,000

$7,368

Phillips

Creek J.V.

KNOC

Newmont

BlackGold

7/24/2006

$270

9,600

$28,125

Shell Canada

BlackRock Ventures

Company

5/8/2006

$2,205

128,120

$17,212

TeckCominco

UTS Energy

15% of Ft. Hills

9/6/2005

$358

6,926

$51,722

TotalFinaElf

Deer Creek

Company

8/2/2005

$1,256

46,771

$26,843

Sinopec

Synenco

40% interest in NLP

5/31/2005

$120

18,211

$6,573

CNOOC

MEG Energy

17% of Company

4/12/2005

$122

5,491

$22,145

Source: J.S. Herold, company reports and public disclosure

Algar

Lake Project

Algar

Lake is expected to be the site of Grizzly’s¹

first oil sands production facility

Grizzly¹

plans to develop Algar

Lake employing a

method of in-situ extraction called Steam Assisted

Gravity Drainage (SAGD) to produce the

leasehold

Expected capital requirements and timing:

•

Anticipated capital cost of approximately C$100

million, or C$25 net to Gulfport, spread over a

period of approximately 2 years

•

Expect to file regulatory application by year-end

2009 and first production by mid-to-late 2012

Production and resource potential for first phase:

Production potential of approximately  1.8

million barrels per year, with approximately 0.45

million barrels net to Gulfport²

Resource potential of approximately 50 to 100

million barrels per facility, with approximately

12.5 to 25 million barrels net to Gulfport²

attributable to equity investment

–

Expect third-party report to confirm       

estimates by year-end 2009

Why develop Algar

Lake first?

Low Geologic Risk –

Will be developing the same

type McMurray Channel sands as found in nearby

JACOS & Connacher

producing SAGD projects

(Ave. Porosity: 33%, Ave Oil Saturation: 80%)

Proximity to Infrastructure –

Nearby access to the

Highway 63 road and pipeline corridor.  Existing

natural gas and electric transmission lines within

one mile of initial project area.

Developing the Canadian Oil Sands

Developing the Canadian Oil Sands

Developing the Canadian Oil Sands

11

¹

Gulfport owns a 24.9999% interest in Grizzly Oil Sands, ULC

²

Gulfport’s position in the Canadian Oil Sands comes by way of its 24.9999% interest in Grizzly Oil Sands, ULC

³

Isopach

map is the products of Grizzly’s internally generated estimates and assumptions

Canadian Oil Sands Economics

Canadian Oil Sands Economics

Canadian Oil Sands Economics

Assumptions

WTI / NYMEX Gas Ratio

15-to-1

AECO Gas as % of Henry Hub

90%

Wellhead Bitumen Price as % of WTI

70%

Nameplate Production Capacity

5,000 Bbls/d

Total CAPEX

C$ 100 - 125 MM

Gas Consumption

1.6 Mcf/Bbl

Annual Non-Fuel Operating Cost

C$ 10 MM

Annual Maintenance CAPEX

C$ 4 MM

Total Estimated Recovery

50 - 100 MMBbls

Generic SAGD Facility Economics¹

Pre-Tax Internal Rate of Return Sensitivities to the Gross 100% Working Interest

for First Phase SAGD Project

27%

51%

40%

0%

10%

20%

30%

40%

50%

60%

$50

$75

$100

West Texas Intermediate (US$/BBL)

12

¹

Internal estimates

Pre-Tax Net Present Value Sensitivities to the Gross 100% Working Interest

for First Phase SAGD Project

$114

$286

$209

$-

$50

$100

$150

$200

$250

$300

$350

$50

$75

$100

West Texas Intermediate (US$/BBL)

Permian Basin

Permian Basin

Permian Basin

•

Currently hold 6,724 net acres

–

Acquired an 2,127 net acres during 2Q’09

–

Recently added an additional 287 net acres

•

Currently shooting seismic on much of

recently acquired acreage

•

Have identified approximately ten net wells

with up-hole opportunities that could

potentially add incremental production

•

Plan to drill approximately one net well in

the Permian during 2009

•

Net proved reserves of 8.40 MMBOE¹

–

100% third party engineered

•

6,724 net acres and 136 net identified future

drilling locations on 40-acre units

2009 Activity Update

•

Average net production of 619 BOEPD

•

Produces approximately 15% of Gulfport’s total

net production

•

82% oil and NGL weighted production mix

Inventory

Production²

¹

12/31/08

²

Three months ended 6/30/09

³CXO: 140-150 MBOE Gross (Q2’09 Earnings Call); PXD: 120-150 MBOE Gross (September 2009 Presentation, Pg. 22);

DVN: 150 MBOE Gross (Q2’09 Earnings Call)

GPOR

Leasehold

Concho

Leasehold

Pioneer

Leasehold

13

Devon

Leasehold

Gross Estimated

Ultimate Recovery

GPOR: 110-145 MBOE

Peers

CXO: 140-150 MBOE

PXD: 120-150 MBOE

DVN: 150 MBOE

3

Permian Basin

Permian Basin

Permian Basin

After Drill PV-10 Value Sensitivities

$3.3

$2.4

$1.5

$1.8

$4.0

$2.9

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

$4.0

$4.5

$50

$75

$100

West Texas Intermediate ($/BBL)

Generic Wolfberry Well Economics

Internal Rate of Return Sensitivities

20%

120%

60%

30%

85%

175%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

$50

$75

$100

West Texas Intermediate ($/BBL)

Reserves

Net Reserves¹

90,000 - 110,000 BOE

Oil

64%

Gas & NGLs

36%

Drill & Complete Cost

$    1.2 MM

WTI / NYMEX Gas Ratio

15-to-1

14

¹

Permian Peer Gross EUR’s: CXO: 140-150 MBOE; PXP: 120-130 MBOE; DVN: 150 MBOE

90 MBOE Net EUR

110,000 BOE Net EUR

90,000 BOE Net EUR

110,000 BOE Net EUR

West Cote Blanche Bay

West Cote Blanche Bay

West Cote Blanche Bay

•

Began

2009

drilling

program

on

June

5

•

Plan to drill approximately 8 to 10 wells at

West Cote during 2009

•

Net proved reserves of 13.40 MMBOE¹

–

100% third party engineered

•

Estimated YE’09 Reserves of 13.58

MMBOE³

2009 Activity Update

•

Average net production of 3,052 BOEPD

•

Produces approximately 72% of Gulfport’s

total net production

•

~100% oil weighted production mix

–

Priced as high quality HLS crude and sold

at a premium to WTI

Inventory

Production²

•

Capital cost of approximately $1.39 MM

•

Internal Rate of Return

–

55% ($65.00 Oil, $4.00 Gas)

–

78% ($75.00 Oil, $5.00 Gas)

–

>100% ($85.00 Oil, $6.00 Gas)

Well Economics

Deep prospective gas opportunities at West Cote Blanche Bay

West Cote Blanche Bay Production Facilities

¹

12/31/08

²

Three months ended 6/30/09

³

2009 internal reserve estimate

15

th

Hackberry

Hackberry

Hackberry

•

Entered into a joint exploration agreement

covering approximately 3,058 net acres

adjacent to the East Hackberry field

–

Represents a significant increase in

footprint at Hackberry, growing Gulfport’s

acreage position by approximately 39%

•

Plan to drill approximately 4 wells at

Hackberry during 2009

•

Proved reserves of 2.86 MMBOE¹

•

13 preliminarily permitted drilling locations

•

Proprietary 42 square mile 3-D seismic

survey shot in 2005

2009 Activity Update

•

Average net production of 539 BOEPD

•

Produces approximately 13% of Gulfport’s

total net production

•

94% oil weighted production mix

Inventory

Production²

•

Capital cost of approximately $1.45 MM per well

Well Cost

¹

12/31/08

²

Three months ended 6/30/09

16

Appendix

17

Hedged Production

Hedged Production

Hedged Production

Month

Weighted Average

Daily Price     

Barrels Per

Day

July-09

$55.17

3,000

August-09

$55.17

3,000

September-09

$54.81

3,000

October-09

$54.81

3,000

November-09

$54.81

3,000

December-09

$54.81

3,000

Gulfport Energy Corporation

Fixed Price Contracts¹

2009

Month

Weighted Average

Daily Price     

Barrels Per

Day

January-10

$54.81

3,000

February-10

$54.81

3,000

March-10

$58.24

2,300

April-10

$58.24

2,300

May-10

$58.24

2,300

June-10

$58.24

2,300

July-10

$58.24

2,300

August-10

$58.24

2,300

September-10

$58.24

2,300

October-10

$58.24

2,300

November-10

$58.24

2,300

December-10

$58.24

2,300

Gulfport Energy Corporation

Fixed Price Contracts¹

2010

¹

Hedges structured as physical contracts in place directly with Gulfport’s crude oil purchaser

²

Hedges marked-to-market based upon 9/25/09 strip pricing

Q1

Q2

Q3

Q4

Total

2010

Fixed Price Contracts

Volume (Bbl)

-

273,000

276,000

276,000

825,000

880,800

Weighted Average Price (Bbl)

-

$       

55.17

$       

55.05

$       

54.81

$       

55.01

$       

57.55

$   

2009

18

Hedges represent a potential mark-to-market hedging loss of approximately $14.7 million¹

Bakken Shale

Bakken Shale

Bakken Shale

•

Located in Montana, North Dakota, South

Dakota and Saskatchewan, the Bakken

formation covers over 200,000 square miles

of the subsurface of the Williston Basin

–

In April 2008, the USGS released a report

estimating there to be 3.0 to 4.3 billion barrels of

undiscovered, technically recoverable oil in the

Bakken

formation

•

Bakken

Shale

–

~900 net acres

19

•

Based upon the identified geologic trends,

Gulfport began actively pursuing acreage

early in the play’s development, effectively

achieving first mover advantages

•

New technology is key to field development

–

Extensive vertical faulting combined with the

application of horizontal drilling techniques and

advancements in fracturing technology have

helped drive development

•

In 1H’09, Gulfport monetized 12,270 net

acres of leases in the Bakken

for $13.0

million

–

~6,740 net acres remained, kept interests in 4

gross wells, and retained up to a 7.5% ORRI in

the acreage sold, proportionately reduced to

Gulfport’s ownership interest after delivering 

80% NRI to the purchaser

•

In 2H’09, Gulfport monetized 5,721 net

acres of leases in the Bakken

for $5.75

million

–

Retained ~900 net acres, interests in 4 gross

wells, and up to a 2.5% ORRI in the acreage

sold, proportionately reduced to Gulfport’s

ownership interest after delivering 81% NRI to

the purchaser

Thailand

Thailand

Thailand

Through an indirect equity investment in APICO,

Gulfport has gained exposure to a natural gas play in

northeast Thailand

–

Third party engineers Gaffney Cline credit wells producing in

the

Phu

Horm

gas

field

with

approximately

½

TCF¹

of

reserves

Net to Gulfport’s interest, total proved reserves are

estimated

to

be

3.5

Bcf

of

natural

gas

and

19,000

barrels of oil

Exploratory potential of four concession blocks

totaling approximately 4 MM acres provides

significant upside

–

APICO has identified several high-quality exploration targets

¹

Third party report issued on 12/31/07

Shoot a 3-D seismic survey of Blocks L27/43 and L16/50 (shown as the

lower brown and yellow blocks on the map)

Gross production in the Phu

Horm

gas field, of which

Gulfport indirectly owns 0.7%, averaged 83 MMcf

per

day of natural gas and 433 Bbls

per day of oil in 2008

Long-term gas sales contract in place with Thai

government in place, locking in favorable pricing

–

Pricing tied to Singapore Medium Sulfur Fuel Oil (MSFO

20