August Investor Presentation

  • View
    940

  • Download
    3

Embed Size (px)

Transcript

  1. 1. NYSE:DVN devonenergy.com InvestorPresentation August2015
  2. 2. InvestorContacts&Notices InvestorRelationsContacts HowardJ.Thill,SeniorVicePresident,Communications&InvestorRelations (405)5523693/howard.thill@dvn.com ScottCoody,Director,InvestorRelations (405)5524735/scott.coody@dvn.com SheaSnyder,Director,InvestorCommunications (405)5524782/shea.snyder@dvn.com SafeHarbor SomeoftheinformationprovidedinthispresentationincludesforwardlookingstatementsasdefinedbytheSecuritiesandExchange Commission.Wordssuchasforecasts,""projections,""estimates,""plans,""expectations,""targets,"andothercomparable terminologyoftenidentifyforwardlookingstatements.Suchstatementsconcerningfutureperformancearesubjecttoavarietyofrisks anduncertaintiesthatcouldcauseDevonsactualresultstodiffermateriallyfromtheforwardlookingstatementscontainedherein, includingasaresultoftheitemsdescribedunder"RiskFactors"inourmostrecentForm10K;andtheitemsdescribedunder "InformationRegardingForwardLookingEstimates"inourForm8KfurnishedAugust4,2015. CautionaryNotetoInvestors TheUnitedStatesSecuritiesandExchangeCommissionpermitsoilandgascompanies,intheirfilingswiththeSEC,todiscloseonly proved,probableandpossiblereservesthatmeettheSEC'sdefinitionsforsuchterms,andpriceandcostsensitivitiesforsuch reserves, andprohibitsdisclosureofresourcesthatdonotconstitutesuchreserves. Thispresentationmaycontaincertainterms,suchas resource potentialand explorationtargetsize. Theseestimatesarebytheirnaturemorespeculativethanestimatesofproved,probableand possiblereservesandaccordinglyaresubjecttosubstantiallygreaterriskofbeingactuallyrealized. TheSECguidelinesstrictlyprohibitus fromincludingtheseestimatesinfilingswiththeSEC.InvestorsareurgedtoconsidercloselythedisclosureinourForm10K, available fromusatDevonEnergyCorporation,Attn.InvestorRelations,333WestSheridan,OklahomaCity,OK731025015.Youcanalsoobtain thisformfromtheSECbycalling1800SEC0330orfromtheSECswebsiteatwww.sec.gov. 2
  3. 3. DevonToday ALeadingNorthAmericanE&P 3 Premierassetportfolio Platformforsustainablegrowth Deliveringsuperiorexecution Advantagedcapitalstructure Disciplinedcapitalallocation
  4. 4. PremierAssetPortfolio 4 Positionedintoptierbasins LeadingDelawareBasinoperator ProlificEagleFordassets HighqualityAnadarkoBasinposition Worldclassheavyoilprojects Significantoperationalmomentum Deliveringtoptierwellproductivity Achievingefficiencies Improvingcoststructure HeavyOil RockiesOil BarnettShale EagleFord DelawareBasin AnadarkoBasin OilAssets LiquidsRichGasAssets
  5. 5. DelawareBasin Overview 5 Industryleaderinbasin Netriskedacres:585,000 Q2netproduction:64MBOED(65%oil) Deliveringtoptierwellresults Deepinventoryoflowriskprojects >5,000riskedlocations Significantupsidefromdownspacing Mostactiveassetinportfolio 2015capital:$1.2billion ActivityfocusedinBoneSpringplay Eddy Lea DelawareSands LeonardShale BoneSpring Wolfcamp
  6. 6. DelawareBasin DeliveringProlificProductionGrowth 6 DelawareBasinProductionGrowth MBOED Oil NGL Gas Q22014 Q22015 40% Growth Perwellproductivitycontinuestoincrease Q2netproductionincreased40%YoY BoneSpringdrivinggrowth 46 64
  7. 7. Q2BoneSpringBasinWells 30DayIPRate,BOED DelawareBasin BoneSpringResultsContinuetoImprove 7 900 1,400 TypeWell Q22015 >50% Increase 1,500 2,000lbs./ft. Enhancedcompletiondesigndrives productivitygains 3xmoresandthanhistoricdesign 16BoneSpringbasinwellsinQ2 Avg.30dayIP:1,400BOED Results>50%abovetypecurve Significantreductioninwellcosts >30%declineinwellcostssinceQ42014 Substantialimprovementsindrillingefficiency Completionssizedtomaximizereturns 523 574 615 Q42014 Q12015 Q22015 18% ProductivityIncrease BoneSpringDrilling AverageFeetDrilledPerDay
  8. 8. DelawareBasin Significant&GrowingResourceOpportunity 8 Identified>5,000risked,undrilledlocations Downspacingpilotsexpectedtogrowinventory Testing8wellspersectioninlower2nd BoneSpringinterval(traditionallandingzone) Appraisingstandalonecommercialityofupperportionof2nd BoneSpring Wolfcamp providessignificantupsidepotential Formation NetRisked Acres RiskedWells PerSection GrossRisked Locations Gross Unrisked Locations Delaware Sands 80,000 4 700 LeonardShale 60,000 5 700 BoneSpring 285,000 4 5 3,500 Wolfcamp 140,000 N/A Evaluating Other 20,000 4 >200 Total 585,000 >5,000 >11,000
  9. 9. EagleFord Overview 9 Toptieracreageposition 75,000netacresfocusedinDeWittCo. Q2netproduction:114MBOED(60%oil) Highestreturningassetinportfolio Deliveringbestinclasswellresults Condensateexportsboostrealizations Lowcostasset:LOE$5perBOE Growingresourceopportunity 400MMBOEofriskedresource EncouragingUpperEagleFordMarlresults Staggeredlateralpilotsunderway Dewitt LavacaGonzales Karnes DevonAcreage Oil Condensate&NGLs DryGas
  10. 10. EagleFord BestInClassResults 10 AcreagelocatedinbestpartofEagleFord Consistentlydeliveringworldclassdevelopmentresults 90DayIPrates125%higherthanindustryaverage 0 250 500 750 1,000 EagleFord90DayWellheadIPs BOED,20:1 Source: IHS/Devon.Basedonwellheadratesforoperatedwellsonlinefor90daysfromJuly2014. 1,000 IndustryAverage:440BOED Peers
  11. 11. EagleFord 11 Perwellproductivityup74%... Whileachievingdrillingefficiencies... Drivingwellcostsdown. EagleFordProduction MBOED Drivingprolificproductiongrowth... 1,120 1,950 March2014 Q22015 74% Increase 30DayIPRates BOED 51 114 March Q22015 125% Growth 2014 15.7 23.9 Q12014 Q22015 50% Efficiency Improvement DeWittDrilling WellsPerRigPerYear $9.5 $7.5 Previous Revised D&CCost $Millions 20% Reduction DeWittCountyProductivityGainsEnhanceResults
  12. 12. AnadarkoBasin CanaWoodfordDevelopmentPlay 12 BestpositioninCanaWoodfordplay 280,000netriskedacres Identified3,600riskedlocations Q2netproduction:59MBOED Recordsettingpadbroughtonline 8wellHaleysection:30dayIP1,850BOED >50%abovetypecurve Drivenbyenhancedcompletiondesign Significantdrillingefficienciesachieved Drillingtimeimproved>30%sinceQ4 Offsettinglargercompletiondesign Totalwellcostsdeclinedby15% CanaWoodfordAcreage 280,000NetAcres CanaWoodfordCore WoodfordActivity HaleyPad 8Wells Avg.30DayIP:1,850BOED
  13. 13. AnadarkoBasin EmergingMeramecOpportunity 13 Appraisalactivityyieldshighratewells Initial14wells:30dayIP1,500BOED Deliveringcompetitivereturns Upsidewithimprovingcompletions Growingresourceopportunity Netriskedacres:60,000 Riskedinventory:>400locations MeramecpotentialacrossCanaacreage AcceleratingMeramecactivity Increasingactivityupto6rigs Spacingpilotsunderway 2015plans:40appraisalwells MeramecOil&LiquidsWindow 60,000NetRiskedAcres MeramecActivity MeramecAppraisal 2Wells(Q22015) Avg.30DayIP:1,500BOED
  14. 14. RockiesOil PowderRiverBasin 14 Parkman FocusArea Campbell Converse Johnson DevonAcreage RecentlyAcquired 42,000netacres Emergingassetwithsignificantpotential Recentlyadded42,000acres Totalnetsurfaceacres:225,000 Riskedlocations:800acrossParkman, TurnerandFrontierformations Deliveringsubstantialgrowthrates Q2netproduction:27MBOED Oilproductionincreased90%YoY StrongQ2developmentresults 8wells:30dayIP1,400BOED Drivenby9,600extendedreachlaterals 2xlengthofpreviousdesign
  15. 15. HeavyOil Overview 15 Locatedinbestpartofoilsands Lowgeologicrisk Thickandcontinuousreservoir Industryleadingoperatingresults Massiveriskedresource:1.4BBO FeaturesofeachJackfishproject: 300MMBOgrossEUR Longreservelife>20years Flatproductionprofile Deliveringtoptierresults Perwellproductivity>40%above industryaverage 650 450 Devon Jackfish Industry Average ProductionPerWell (Bbls/d) Source:FirstEnergy
  16. 16. HeavyOil DeliveringVisibleOilGrowth 16 Oilproductionup27%overpastyear DrivenbyworldclassJackfishcomplex Q2grossproduction:75MBOD Productionincreased41%YoY LOEdeclinedby>30%YTD Jackfish3rampupaheadofschedule Currentgrossproduction:27.5MBOD Expect35MBODbyendof2015 Q2marginsexpandedto$17perbarrel HeavyOilProduction MBOD Q22014 Q22015 Lloydminster Jackfish1 Jackfish2 Jackfish377 98 27% Growth 1.7 11.2 14.6 23.1 27.5 35.0 Q32014 Q42014 Q12015 Q22015 Current YE2015 Jackfish3GrossProductionRampUp MBOD
  17. 17. PlatformForSustainableGrowth Significant&GrowingResourceOpportunity 17 HeavyOil RockiesOil BarnettShale EagleFord AnadarkoBasin OilAssets LiquidsRichGasAssets DelawareBasin Asset RiskedOpportunity UpsidePotential Delaware Basin >5,000undrilled locations Spacing pilots underway EagleFord 400MMBoe of risked resource UpperEFdelineation andstaggeredlateral developmentof LowerEF Anadarko Basin >4,000undrilled locations Continued appraisal ofMeramec Heavy Oil 1.4billionbarrels ofriskedresource Technologyto improvefacility performanceand increasefuture recoveryrates Barnett Shale 5,000plus producing wells Significanthorizontal refrac potential Rockies Oil 800undrilled locations Furtherderisking of Parkmanoilfairway
  18. 18. 18 DeliveringSuperiorExecution Maximizebaseproduction Minimizecontrollabledowntime Enhancewellproductivity Leveragemidstreamoperations Reduceoperatingcosts OperatingStrategyForLongTermSuccess Optimizecapitalprogram Disciplinedprojectexecution Performpremiertechnicalwork Focusondevelopmentdrilling Reducecapitalcosts CaptureFull Value Improve Returns
  19. 19. DeliveringSuperiorExecution LeveragingTechnologyToEnhancePerformance 19 Decisionsupportcentersenhanceperformance Minimizedowntime Reducedrillingtimes Improvewellplacementandcompletiondesign OptimizeflowratesandNPVperwell Benefitsbeyondwellperformance Enhancedcollaborationwithtechnicalteams Fasterdecisionmaking Encouragesinnovation Targetingupto$250millionofvaluegainsannually
  20. 20. DeliveringSuperiorExecution ATrackRecordOfPerformance 20 176 270 Q12014 Q22015 OilProduction MBOD Focusedinvestmentdrivesstrongoil growth Whileshiftingtohighermarginproduct Andmaintainingalowcoststructure. 54% Growth Produ