Exhibit 99.2
8-K Robert L.G. Watson will be presenting at the IPAA Small Cap Oil & Gas
Investment Symposium in Hollywood, Florida on February 8, 2006
Slide 1: Abraxas Petroleum Corporation
IPAA Small Cap Oil & Gas Investment Symposium
February 8, 2006
The information presented herein may contain predictions, estimates and other
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although the
Company believes that its expectations are based on reasonable assumptions, it
can give no assurance that its goals will be achieved. Important factors that
could cause actual results to differ materially from those included in the
forward-looking statements include the timing and extent of changes in commodity
prices for oil and gas, the need to develop and replace reserves, environmental
risks, competition, government regulation and the ability of the Company to meet
its stated business goals.
Picture: Collage of oil field pictures & outline of the U.S.
Slide 2: Back to the Basics...
Abraxas Petroleum Corporation
o AMEX: ABP
o Market capitalization - $300 million
o Enterprise value - $430 million
o Options: CBOE and PCX
o Fully diluted shares outstanding - 45.1 million
o Average trading volume (2005) - 489,000 shares per day
o Traded 123 million shares (2005) - 273% of FD shares
o Share price appreciation (2005) - 128%
o Operations in Texas and Wyoming
o > 10 year inventory of projects on existing leasehold
Natural gas
o Approximately 80%
Quality assets
o High ownership interests (79% WI)
o Operations (95%)
o High producing rates per well
o Large acreage positions
o Substantial upside
Slide 3: Debt to Enterprise Value...
Current Debt / Total Enterprise Value = 30%
Area chart of total enterprise value and market cap from Dec 95 to current with
significant corporate events notated
Slide 4: Growth...
....through the drill bit
2005 Success Rate = 92% (13 major projects)
Cash Flow 400%
Revenue 80%
Production 58%
Bar chart of cash flow, revenue and production by quarter
Slide 5: Operations...
Proved Reserves - 93.7 Bcfe (1)
Net Production - 22.4 MMcfepd (2)
Net Undeveloped Acres ~ 64,600 (3)
227 Identified Projects (PUDs and Incrementals)
Map of the United States highlighting Wyoming and Texas
Wyoming 0.8 Bcfe - 1%
0.3 MMcfepd - 1%
46,000 acres - 71%
28 projects
West Texas 65.1 Bcfe - 69%
14.9 MMcfepd - 67%
17,900 acres - 27%
172 projects
South Texas 27.8 Bcfe - 30%
7.2 MMcfepd - 32%
1,100 acres - 2%
27 projects
(1) as of 12/31/04
(2) 2005 exit rate
(3) as of Dec-05
Slide 6: Goals 2006...
Back to Basics...
Operations
- ----------
Drill Bit Growth
Emerging Gas & Oil Resource Plays
& Conventional Reservoirs
Shareholders
- ------------
Continue to Maximize Value
Slide 7: 2006 Projects...
$40 million budget from $70 million of projects approved by Board
South Texas
-----------
Edwards
Portilla
Wilcox
West Texas
----------
Cherry Canyon
Delaware
Oates SW
IRA
Wyoming
-------
Brooks Draw
Slide 8: West Texas...
Map of Texas highlighting certain counties in West Texas
166 wells (74% WI) (1)
65.1 Bcfe - 69%
14.9 MMcfepd - 67%
17,600 NUA - 27%
172 identified projects
(80 conventional / 92 resource)
Average depth: >14,000'
2006 Project Areas & Target Zones:
- ---------------------------------
IRA
Clearfork / Strawn Reef
Delaware
Atoka / Mississippian / Woodford /
Devonian / Montoya / Ellenburger
Cherry Canyon
Cherry & Bell Canyon
Oates SW
Wolfcamp / Woodford / Atoka / Devonian
(1) as of 12/31/04
Slide 9: Delaware Basin Activity...
Map of Texas highlighting certain counties in West Texas
Resource Gas Plays
Loving / Reeves / Ward Counties
Primary Target - ATOKA
Culberson / Reeves / Pecos Counties
Primary Target - WEST TEXAS SHALES
Conventional
Ward / Pecos Counties
Multiple Targets
Slide 10: Atoka...
Map of Texas highlighting Reeves, Loving and Ward counties in West Texas
CHK & APC: Large fracs
ABP offset acreage: CHK recently leased ~10,000 acres for $200 - $2,000 per acre
ABP: ROC, Block 16 & Howe Fields
6,210 net acres HBP
Numerous producers (never fraced)
8 resource projects
ABP: Nine Mile Draw Field
1
2,350 net acres HBP
Shows behind pipe
Slide 11: West Texas Shale...
Map of Texas highlighting Culberson, Reeves and Pecos counties in West Texas,
highlighting the following companies which are active in the area:
EOG, ECA, Petro-Hunt, SWN, RRC, BR, KWK, PPP, K2X, CWEI (ECA), Reliance,
XTO
ABP: Nine Mile Draw Field
2,350 net acres HBP
Shows behind pipe
ABP: Oates SW Field
13,000 acres
(fee mineral/leasehold/executive)
First Woodford well on production
84 resource projects
Slide 12: Conventional...
Map of Texas highlighting Ward and Pecos counties in West Texas
ABP: ROC, Block 16 & Howe Fields
6,210 net acres HBP
36 conventional projects
ABP: Oates SW Field
13,000 acres
(fee mineral/leasehold/executive)
2 Devonian wells: > 7 MMcfepd
6 conventional projects
Slide 13: South Texas...
Map of Texas highlighting certain counties in South Texas
45 wells (93% WI(1)
27.8 Bcfe - 30%
7.2 MMcfepd - 32%
1,200 NUA - 2%
27 identified projects
Average depth: > 11,000'
2006 Project Areas & Target Zones:
- ---------------------------------
Edwards
Edwards / Wilcox
Wilcox
Wilcox / Reklaw / Mackhank
Portilla
Frio / Vicksburg
(1) as of 12/31/04
2
Slide 14: Wyoming...
Map of Wyoming highlighting certain counties in east central Wyoming
Resource Oil Play
10 wells (100% WI) (1)
0.8 Bcfe - 1%
0.3 MMcfepd - 1%
45,800 NUA - 71%
28 identified projects
Average depth: 9,000'
2006 Project Area & Target Zones:
- --------------------------------
Brooks Draw
Teapot / Niobrara /
Turner / Mowry / Muddy
(1) as of 12/31/05
Slide 15: 2006 Guidance...
Production
Annual (Bcfe) 7.5 - 8.5
Exit Rate (MMcfe/d) 22 - 24
Price Differentials off NYMEX
Gas (%/Mcf) 5%
Oil ($/Bbl) 1.00
Production Taxes (% of Revenue) 10%
Direct Lease Operating Expenses ($/Mcfe) 1.10
G&A ($/Mcfe) 0.55
Interest ($/Mcfe) 2.00
D/D/A ($/Mcfe) 1.30
Capital Expenditures ($MM) 40.0
Guidance does not include non-cash and extraordinary
items Hedge position: 10,000 Mcf/d through August 2006 with $5.00-$8.00 floor
Slide 16: Maximize Shareholder Value...
Continue to improve balance sheet
o current debt to total enterprise value = 30%
Maintain financial flexibility and liquidity
Prioritize large opportunity set of projects
Slide 17: Summary...
Niche exploitation and production company
High quality assets with substantial upside
Goals:
o Drill Bit Growth targeting Emerging Gas & Oil Resource Plays &
Conventional Projects in Texas and Wyoming
o Maximize Shareholder Value
Slide 18: www.abraxaspetroleum.com
Picture: Delaware Basin, West Texas