March 23, 2015 - Amazon Web Services · 2015-03-20 · March 23, 2015 . Building the Premier Western Energy Producer PICEANCE BASIN SAN JUAN BASIN ... RBC Capital Markets Bakken heat

Scotia Howard Weil 43rd Annual Energy Conference

Rick Muncrief, President and Chief Executive Officer

March 23, 2015

Building the Premier Western Energy Producer

PICEANCE BASIN

SAN JUAN BASIN

WILLISTON BASIN

Natural Gas

Oil

Natural Gas and Natural Gas Liquids

High-Quality Rocks (Rocks matter)

Established Infrastructure (Infrastructure matters)

Access to Advantaged Markets (Markets matter)

Commodity Optionality (Flexibility matters)

2 Howard Weil Energy Conference | WPX Energy, Inc. | March 2015

Strong oil growth ► Domestic oil production of 32.3 Mbbl/d, which grew 25% 4Q ’14 vs. 3Q ’14

► Normalized oil production grew 71% quarter over quarter

► San Juan Gallup 395% oil production Y/Y

66% increase in CFFO 2014 vs. 2013 Strong hedge position in 2015

► 78% of natural gas hedged at an average price of $4.09 per MMBtu1

► 68% of oil production hedged at an average price of $94.88 per barrel1

Recently completed two asset sales totaling ~$600MM in proceeds

► Northeast Pennsylvania acreage and transportation

► Sold 69% interest in Apco Oil and Gas

Highlights

1 Based on the midpoint of guidance


2014 Highlights

Record oil production of 25.3 Mbo/d

► YOY oil growth of 56%

► Williston oil grew 48% YOY

► San Juan Gallup grew 388% YOY

Proved oil replacement rate of more than 400%

$0

$2

$4

$6

$8

$10

$12

$14

$16

2012 2013 2014

$/b

oe

Cash Margin per BOE

-

5

10

15

20

25

30

2012 2013 2014

Mb

oe

/d

Williston San Juan

2012-14 Production (oil focused areas)

Cash margins from continuing operations increased 74% versus 2013, $15.11 versus $8.68 per BOE Cash margin CAGR of 19% 2012 to 2014


1st Quarter 2015 Trend Exceeding Expectations

5

Expect positive update to full-year guidance2

WELL COST

► Williston well cost below $9MM

► San Juan Gallup well cost approaching $4MM

CAPITAL

► Shifting capital from the Piceance Mancos/Niobrara program to San Juan Gallup

1Q PRODUCTION

► Equivalent production exceeding guidance1

► Oil production above high-end of range

OPERATIONS

► Significant improvement in LOE

► G&A cost trending below 2015 guidance

2 Guidance update May 6, 2015

Howard Weil Energy Conference | WPX Energy, Inc. | March 2015


Williston – Contiguous Acreage Position in Core of Play

Strong production growth in 2014

► Averaged 27 Mboe/d in 4Q ’14

► Mboe/d up 59% 4Q ’14 vs. 4Q ’13

2014 activity

► Completed 53 gross operated wells

► Average spud-to-rig release time decreased 11% to 25 days

► Infill density project added ~200 gross drilling locations

New basin leadership team

2015 outlook

► Pursuing optimal stimulations

► Running 1 rig for balance of year

► Relentless focus on cost reductions

► Optionality to reach all coastal markets

WPX’s Acreage

Window

Source: RBC Capital Markets Bakken heat map, December 2014


San Juan – Basin Leader in Efficiency and Resource Assessment

Execution drives strong production growth

► Gallup averaged 10.6 Mboe/d in 4Q ’14

► Oil production up 388% 4Q ’14 vs. 4Q ’13

2014 activity

► Completed 47 gross wells averaging 2.25 rigs

► Average spud-to-rig release time decreased 40% to 13.5 days

► Moved to multi-pad drilling and zipper fracs

Constructed 95 miles of gathering lines in 2014

2015 outlook

► Averaging 1.5 rigs in the oil window and 0.8 rigs in the gas window

► Expand gathering system

► Expect improving differentials as additional takeaway capacity goes into service in 2015


DRY GAS

WET GAS

OIL

San Juan Gallup Improving Cycle Times Driving Growth

2015 Wells

2013 Wells

improvement in avg. wells drilled

per year per rig

Compare 30-Day Spud-to-Spud vs. 14-Day Spud-to-Spud MBO/Day vs. Months

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 56 58 60

Pro

du

ctio

n R

ate

Mb

o/d

ay

Months

14 Day 30 Day

5,700 BOPD

12,170 BOPD

100%


Williston and San Juan Gallup Quarterly Production (2012-14)

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5

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15

20

25

30

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40

1Q 2012 2Q 2012 3Q 2012 4Q 2012 1Q 2013 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014 4Q 2014

MB

OE/

D


San Juan Gallup Williston

Takeaway Optionality to Premier Markets

10

Bakken ► Optionality in all directions for crude sales depending on best market

► 675,000 bbl/d of additional long-haul pipeline capacity expected out of the Bakken by late 2016 and early 2017 further improving netbacks

► Energy Transfer/Phillips 66 JV – 450,000 bbl/d

► Enbridge Sandpiper – 225,000 bbl/d

San Juan ► Pipeline outlets to Western’s Gallup

(25,000 bbl/d) and El Paso (128,000 bbl/d) refineries along with rail options to the West and Gulf Coasts

Brent/ANS

LLS

Brent Guernsey

Clearbrook

WTI RAIL

PIPE

2016-17 PIPE ADDS

Brent/ANS

Bakken

San Juan


Piceance – Proven Low-Cost Operator with Large Resource Base

#1 gas producer in Colorado ► Multi-decade inventory

► Lowest-cost operator

► Unbooked resource potential ‒ Niobrara/Mancos

2014 activity

► Increased focus in Ryan Gulch

► Reduced lifting costs to $0.23/Mcfe

Uniquely positioned for value-creating activity

► Agreed to multi-year carry of ~400 gross wells in Trail Ridge, $210MM value

► Production sale to MLP for $355MM

Assessing deep potential ► Multi-zone targets proven

2015 outlook

► Averaging 2.5 rigs running in the Valley, Ryan Gulch and Trial Ridge

► Averaging 1 rig ‒ Niobrara/Mancos

► Mature infrastructure


Hedging Overview

2015 2016

Volume/Day Average Price Volume/Day Average Price

Natural Gas (MMBtu)

Fixed Price Swaps1 442,055 $4.10 280,000 3.81

Costless Collars 50,000 $4.00 - $4.50 – –

Natural Gas Basis (MMBtu)

MidCon Basis Swaps 17,075 ($0.18) – –

Rockies Basis Swaps 214,055 ($0.16) – –

San Juan Basis Swaps 98,726 ($0.11) – –

SoCal Basis Swaps 20,000 $0.18 – –

Crude Oil (bbl)

Fixed Price Swaps1 20,236 $94.88 – –

1 In connection with several natural gas and crude oil swaps, we entered into swaptions with the swap counterparties granting the counterparty the right, but not the

obligation, to enter into an underlying swap with us in the future.

As of 2/23/2015


WPX is Well Hedged for 2015 in Relation to Peers

Fixed Price Swaps (Mbbl/d) Volume 20.24 Price $94.88

Production Estimate: 29.7 1 % Protected: 68% 1

Wgt Avg Floor Price: $94.88

WPX 2015 Oil Hedges (Mbbl/d)

$80.00

$82.00

$84.00

$86.00

$88.00

$90.00

$92.00

$94.00

$96.00

$98.00

$100.00

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

PXD RRC NFX NBL WPX EGN CXO DVN SM CHK QEP WLL CLR COG CRC EQT SWN UPL XEC

% Protected Avg % Protected Wgt Avg Floor Price

As of 3/9/2015

2015 Equivalent Oil (Mbbl/d)

13



WPX is Well Hedged for 2015 in Relation to Peers

Fixed Price Swaps (MMBtu/d) Volume 442.1 Price $4.10

Basis Swaps Volume 349.9 Price (0.13)

Collars (MMBtu/d) Volume 50.00 Floor Price $4.00 Ceiling Price $4.50

Production Est. 548.46 1 % Protected 78% 1 Wgt Avg Floor Price $4.09

$3.50

$3.60

$3.70

$3.80

$3.90

$4.00

$4.10

$4.20

$4.30

$4.40

$4.50

0%

20%

40%

60%

80%

100%

120%

140%

EGN PXD WPX NFX RRC QEP UPL EQT SM CHK DVN COG NBL SWN CXO CLR CRC WLL XEC

% Protected Avg % Protected Wgt Avg Floor Price

2015 Equivalent Gas (MMBtu/d)

As of 3/9/2015

WPX 2015 Gas Hedges (MMBtu/d)

14



Positioned for Success in 2015 and Beyond

15

Execution

Focus

Discipline

Opportunistic


Disclaimer

The information contained in this summary has been prepared to assist you in making your own evaluation of the Company and does not purport to contain all of the information you may consider important in deciding whether to invest in shares of the Company’s common stock. In all cases, it is your obligation to conduct your own due diligence. All information contained herein, including any estimates or projections, is based upon information provided by the Company. Any estimates or projections with respect to future performance have been provided to assist you in your evaluation but should not be relied upon as an accurate representation of future results. No persons have been authorized to make any representations other than those contained in this summary, and if given or made, such representations should not be considered as authorized.

Certain statements, estimates and financial information contained in this summary constitute forward-looking statements or information. Such forward-looking statements or information involve known and unknown risks and uncertainties that could cause actual events or results to differ materially from the results implied or expressed in such forward-looking statements or information. While presented with numerical specificity, certain forward-looking statements or information are based (1) upon assumptions that are inherently subject to significant business, economic, regulatory, environmental, seasonal, competitive uncertainties, contingencies and risks including, without limitation, the ability to obtain debt and equity financings, capital costs, construction costs, well production performance, operating costs, commodity pricing, differentials, royalty structures, field upgrading technology, and other known and unknown risks, all of which are difficult to predict and many of which are beyond the Company's control, and (2) upon assumptions with respect to future business decisions that are subject to change.

There can be no assurance that the results implied or expressed in such forward-looking statements or information or the underlying assumptions will be realized and that actual results of operations or future events will not be materially different from the results implied or expressed in such forward-looking statements or information. Under no circumstances should the inclusion of the forward-looking statements or information be regarded as a representation, undertaking, warranty or prediction by the Company or any other person with respect to the accuracy thereof or the accuracy of the underlying assumptions, or that the Company will achieve or is likely to achieve any particular results. The forward-looking statements or information are made as of the date hereof and the Company disclaims any intent or obligation to update publicly or to revise any of the forward-looking statements or information, whether as a result of new information, future events or otherwise. Recipients are cautioned that forward-looking statements or information are not guarantees of future performance and, accordingly, recipients are expressly cautioned not to put undue reliance on forward-looking statements or information due to the inherent uncertainty therein.


Reserves Disclaimer

The SEC requires oil and gas companies, in filings made with the SEC, to disclose proved reserves, which are those quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible – from a given date forward, from known reservoirs, under existing economic conditions, operating methods, and governmental regulations. The SEC permits the optional disclosure of probable and possible reserves. We have elected to use in this presentation “probable” reserves and “possible” reserves, excluding their valuation. The SEC defines “probable” reserves as “those additional reserves that are less certain to be recovered than proved reserves but which, together with proved reserves, are as likely as not to be recovered.” The SEC defines “possible” reserves as “those additional reserves that are less certain to be recovered than probable reserves.” The Company has applied these definitions in estimating probable and possible reserves. Statements of reserves are only estimates and may not correspond to the ultimate quantities of oil and gas recovered. Any reserve estimates provided in this presentation that are not specifically designated as being estimates of proved reserves may include estimated reserves not necessarily calculated in accordance with, or contemplated by, the SEC’s reserves reporting guidelines. Investors are urged to consider closely the disclosure regarding our business that may be accessed through the SEC’s website at www.sec.gov.

The SEC’s rules prohibit us from filing resource estimates. Our resource estimations include estimates of hydrocarbon quantities for (i) new areas for which we do not have sufficient information to date to classify as proved, probable or even possible reserves, (ii) other areas to take into account the low level of certainty of recovery of the resources and (iii) uneconomic proved, probable or possible reserves. Resource estimates do not take into account the certainty of resource recovery and are therefore not indicative of the expected future recovery and should not be relied upon. Resource estimates might never be recovered and are contingent on exploration success, technical improvements in drilling access, commerciality and other factors.


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March 23, 2015 - Amazon Web Services · 2015-03-20 · March 23, 2015 . Building the Premier Western Energy Producer PICEANCE BASIN SAN JUAN BASIN ... RBC Capital Markets Bakken heat