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Permian Investor Presentation October 2012. 2 Forward-Looking Statements Except for historical information contained herein, the statements, charts and.

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Presentation on theme: "Permian Investor Presentation October 2012. 2 Forward-Looking Statements Except for historical information contained herein, the statements, charts and."— Presentation transcript:

1 Permian Investor Presentation October 2012

2 2 Forward-Looking Statements Except for historical information contained herein, the statements, charts and graphs in this presentation are forward-looking statements that are made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of Forward-looking statements and the business prospects of Pioneer are subject to a number of risks and uncertainties that may cause Pioneer's actual results in future periods to differ materially from the forward-looking statements. These risks and uncertainties include, among other things, volatility of commodity prices, product supply and demand, competition, the ability to obtain environmental and other permits and the timing thereof, other government regulation or action, the ability to obtain approvals from third parties and negotiate agreements (including joint venture agreements) with third parties on mutually acceptable terms, litigation, the costs and results of drilling and operations, availability of equipment, services and personnel required to complete the Company's operating activities, access to and availability of transportation, processing and refining facilities, Pioneer's ability to replace reserves, implement its business plans (including its plan to complete certain asset divestments) or complete its development activities as scheduled, access to and cost of capital, the financial strength of counterparties to Pioneer's credit facility and derivative contracts and the purchasers of Pioneer's oil, NGL and gas production, uncertainties about estimates of reserves and resource potential and the ability to add proved reserves in the future, the assumptions underlying production forecasts, quality of technical data, environmental and weather risks, including the possible impacts of climate change, the risks associated with the ownership and operation of an industrial sand mining business, international operations and acts of war or terrorism. These and other risks are described in Pioneer's 10-K and 10-Q Reports and other filings with the Securities and Exchange Commission. In addition, Pioneer may be subject to currently unforeseen risks that may have a materially adverse impact on it. Pioneer undertakes no duty to publicly update these statements except as required by law. Please see the appendix slides included in this presentation for other important information.

3 Topics  PXD OverviewTim Dove  Spraberry Overview & GeologyChris Cheatwood  Spraberry OperationsDanny Kellum  Horizontal Wolfcamp ShaleChris Cheatwood 3

4 4 PXD Overview

5 5  U.S. asset base  Oil exposure from proved reserves + estimated net resource potential of >7 BBOE  2012 drilling program focused in three liquids and resource rich core assets in Texas – Spraberry Vertical – Horizontal Wolfcamp Shale Joint venture accelerates future development – Eagle Ford Shale  Barnett Shale divestiture allows reallocation of capital to three core Texas assets  Strong production growth profile  Vertical integration substantially improving returns  Attractive derivative positions protect margins  Strong investment grade financial position Investment Highlights

6 Production Growth Target 1 MBOEPD 25% - 29% 120 ~65% Liquids 147 1)Reflects Tunisia and South Africa as discontinued operations 39% Oil 34% Oil 2012 E – 153 FY Guidance 27% Oil % Oil  Increased 2012 production growth target from 23% - 27% to 25% - 29%  Strong drilling and well performance outweighs continuing third-party NGL fractionation capacity shortfalls and reduced 2H drilling activity  Production growth rate beyond 2012 dependent on commodity prices and service costs

7  Capital program includes: – Drilling capital 2.4 – Vertical integration0.5 Includes $100 MM for field facilities accelerated into  Capital program funded from: – Operating cash flow 1.8 – Equity offering proceeds 0.5 – Liquidated derivatives and inventory reduction0.3 – Credit facility borrowings 0.2 – South Africa divestiture and South Texas acreage sale NYMEX Oil Price ($/BBL) NYMEX Gas Price ($/MCF) $85/bbl oil and $3/mcf gas Sensitivity to Commodity Prices ($ MM) E Capital Spending and Cash Flow 1 1)Capital spending excludes acquisitions, asset retirement obligations, capitalized interest and G&G G&A $B

8 Horizontal Wolfcamp Shale 80% Oil / 10% NGLs / 10% Gas 400,000+ Gross Acres 3.5 BBOE Resource Potential ~8,000 Drilling Locations Horizontal Wolfcamp Shale 80% Oil / 10% NGLs / 10% Gas 400,000+ Gross Acres 3.5 BBOE Resource Potential ~8,000 Drilling Locations Pioneer’s Liquids-Rich Growth Areas 8 Spraberry Vertical 70% Oil / 20% NGLs / 10% Gas 900,000 Gross Acres 609 MMBOE Proved Reserves 2.1 BBOE Resource Potential ~23,000 Drilling Locations 64 MBOEPD Q2 Net Production Spraberry Vertical 70% Oil / 20% NGLs / 10% Gas 900,000 Gross Acres 609 MMBOE Proved Reserves 2.1 BBOE Resource Potential ~23,000 Drilling Locations 64 MBOEPD Q2 Net Production Eagle Ford Shale 40% Oil / 20% NGLs / 40% Gas 300,000 Gross Acres 70 MMBOE Proved Reserves 600 MMBOE Resource Potential ~1,800 Drilling Locations 24 MBOEPD Q2 Net Production

9 9 12/31/11 Proved Reserves: 1.1 BBOE 2 Additional Net Resource Potential: 6.7 BBOE 1)All drilling locations shown on a gross basis 2)SEC pricing of $96.13/BBL for oil and $4.12/MMBTU for gas (NYMEX) 3)Primarily reflects Alaska, Raton and South Texas 4)Includes vertical well potential from Wolfcamp and deeper intervals 5)Assumes average EUR of 575 MBOE per well, >8,000 locations, >400,000 acres, 140-acre spacing, laterals in all intervals (A, B, C & D) and 75% NRI Permian 5.6 BBOE Spraberry 609 MMBOE 4,700 PUD locations Raton 170 MMBOE 150 PUD locations Other 107 MMBOE 120 PUD locations Mid-Continent 107 MMBOE Spraberry 40-ac Drilling MMBOE 5,200 locations Spraberry 20-ac Drilling BBOE 13,500 high-graded locations Spraberry Waterflood 300 MMBOE 40% acreage Eagle Ford Shale 600 MMBOE 1,700 locations Other MMBOE 500 locations Barnett 300 MMBOE 1,300 locations Eagle Ford Shale 70 MMBOE 120 PUD locations Horizontal Wolfcamp BBOE 8,000 locations Proved Reserves + Estimated Net Resource Potential of >7 BBOE and 35,000 Drilling Locations 9 Significant Proved Reserves and Resource Potential 1

10 10 Spraberry Overview & Geology

11 Permian Basin Producing Fields 11 Source: Geomap, 2006 Spraberry Trend  Largest Field in Midland Basin (~5,000 sq miles)  >14,000 producing wells  >1 billion barrels produced  >180,000 BOPD current production Spraberry Trend  Largest Field in Midland Basin (~5,000 sq miles)  >14,000 producing wells  >1 billion barrels produced  >180,000 BOPD current production

12  Permian Basin is composed of multiple uplifts and basins that formed during the Pennsylvanian and early Permian  The Spraberry Trend, which includes the Wolfcamp interval, is located in the Midland Basin of the Permian Basin  It was discovered in 1948 and commenced production in 1949  It contains 40 BBO in-place in Spraberry-Dean interval −Much more oil in-place in deeper zones of Wolfcamp, Strawn, Atoka and Mississippian OZONA PLATFORM 12 Geologic Provinces of the Permian Basin PEDERNAL UPLIFT & ROOSEVELT POSITIVE DEVIL’S RIVER UPLIFT Basin Basement Uplift Shelf Thrust Belt CONFIDENTIAL Spraberry Trend

13 13 Midland Basin Depositional Setting and Source  Submarine fans of Dean and Spraberry were deposited during relative sea-level fall via submarine canyons cut mainly in Northern Shelf – Spilled into main depocentre to south forming distal fans – Saddles between atoll mounds acted as conduits for clastics  Spraberry formation was a mud-rich fan complex – High transport efficiencies allowed extensive network of muds, silts and very fine sands over 150 miles  Main productive interval in Spraberry Trend is the middle-upper Spraberry Formation – Subordinate production Dean and Wolfcamp – Sourced from Spraberry shales and basal shales Handford, 1981 Blakey, Early Leonardiian Representation ~6,000 ft ~10,000 ft Clear- fork Dean Upper Spraberry Wolfcamp Lower Spraberry Atoka or Miss. ~11,000 ft Strawn Limestone Pay Sandstone Pay Non-Organic Shale Non-Pay Organic Rich Shale Pay

14 Evolution of Spraberry Trend Area ,000 acres Present Day >1,700,000 acres and growing 14 PXD Acreage Spraberry Field Source: Bureau of Economic Geology Source: PXD

15 15 Spraberry Operations

16 Operations 16 Example of Spraberry Development, NW Martin County  Excellent operating environment  PXD has long history of development in the area

17 s – Early Development 1960s – Field extension Progression of Field Development 1 1) Source: IHS – Well location data prior to 1970 is limited Major Oil Company development; principally Texaco, Phillips and Mobil Continued development by Majors with a few minor Independents 1970s – Dramatic expansion Continued development by Majors with a few minor Independents 1980s – Expansion & Infill 1990s – Infill and efficiency 2000s – Infill and efficiency Independents including Parker & Parsley (Pioneer’s predecessor Company) become large players; less emphasis by Majors Independents continue to dominant the landscape driven by Pioneer Independents lead the charge going deeper; activity builds in the Horizontal Wolfcamp Shale in southern portion of the basin Independents become the dominant player 2010s – Deeper and horizontals

18 18 History of Spraberry Trend Completions s s s Limestone Pay Sandstone Pay Non-Organic Shale Non-Pay Organic Rich Shale Pay Average Casing Depth Testing deeper zones ~6,000 ft ~10,000 ft Clear- fork Dean Upper Spraberry Wolfcamp Lower Spraberry Atoka or Miss. ~11,000 ft Strawn Fracture Stimulation Stages Drilling deeper, adding fracture stimulation stages and capturing pay from non- traditional shale/silt intervals have added production and improved recoveries

19 Permian Basin Historical Oil Production 19 Source: BENTEK, HPDI

20 Permian Rig Count Increased 5X Since 2009 Source: Baker Hughes 20

21 PXD – Largest Spraberry Acreage Holder, Driller and Producer PXD Acreage (~900,000 Acres; ~75% HBP) 21 Spraberry Field  PXD leasehold represents ~50% of total Spraberry acreage  ~7,000 operated wells  Drilling locations : −>23,000 vertical (central and northern parts of the field) −>8,000 horizontal Wolfcamp (based on 400,000 acres primarily in the southern portion of the field)  540 total wells drilled YTD

22 22 Field Operations & Logistics  Currently operate ~7,000 wells – 1,600+ well batteries/facilities – Substantial expansion of field offices  Growth and expansion – Drilling ~650 vertical wells and ~35 horizontal wells in 2012 – Ongoing construction of new roads, tank batteries and gathering lines – Significant expansion of gas processing facilities in  Manage growth and increased workload – Hiring additional field personnel – Optimizing field personnel workloads by becoming more efficient – Providing housing solutions for employees Highway 80 Field Office Midkiff Field Office San Angelo Field Office

23  XSPOC SCADA 1 System currently contains over 5,600 wells  PXD’s Permian Asset Team operates the largest XSPOC System in the US  Adding advanced programmable logic controllers to disposal & injection wells  Added monitoring for waterflood injection system  Installing electronic gauging on tank batteries Automation Expansion Radio Transmitters 1) eXpert System Pump Off Controller – Supervisory Control And Data Aquisition 23

24 24 Production Optimization Pays Dividends 2,900 Operated Wells 1 Failure Every 10 Months ~7,000 Operated Wells 1 Failure Every 55 Months Mean Time Between Failures (Months) Failures per Month

25 Spraberry 5 vertical frac fleets (~20,000 HP each) 2 horizontal frac fleets (~35,000 HP each) 15 drilling rigs Well service equipment 1 Eagle Ford Shale 2 frac fleets (50,000 HP each) 2 coiled tubing units 25 PXD’s Vertical Integration Reduces Costs and Enhances Execution Current frac capacity: ~300,000 HP 13 th largest pressure pumping company in North America Current frac capacity: ~300,000 HP 13 th largest pressure pumping company in North America 1)Includes pulling units, frac tanks, hot oilers, water trucks, blowout preventers, construction equipment and fishing tools Barnett Shale Combo 1 frac fleet (30,000 HP) 1 coiled tubing unit Brady sand mine

26 Spraberry Vertical Deeper Drilling Driving Production Outperformance 26 ~6,000 ft ~10,000 ft Clear- fork Dean Upper Spraberry Wolfcamp Lower Spraberry Limestone Pay Sandstone Pay Non-Organic Shale Non-Pay Organic Rich Shale Pay Atoka or Miss. ~11,000 ft Strawn Current Spraberry 40-acre type curve EUR including Lower Wolfcamp: 140 MBOE Deeper drilling provides potential to add up to 100 MBOE Current Spraberry 40-acre type curve EUR including Lower Wolfcamp: 140 MBOE Deeper drilling provides potential to add up to 100 MBOE Deeper drilling increased from 50% to 65% of 2012 vertical drilling program Commingled Wells Placed on Production in Q2 Average 24-hour IP (BOEPD) 1 Potential Incremental EUR (MBOE) Prospective PXD Acreage Strawn ~70% Atoka – 7040% - 50% Mississippian – 40~20% 1)Compares to average 24-hour IP of 90 BOEPD for 140 MBOE EUR type curve well in the Lower Wolfcamp

27 Continuing to Successfully Grow Spraberry Production 27 Spraberry Net Production 1 (MBOEPD) 1) Includes production from Strawn, Atoka and Mississippian in vertical wells and horizontal Wolfcamp Shale wells 2) Production from horizontal Wolfcamp Shale forecast at ~2,000 BOEPD in 2012; ~1,000 BOEPD average in Q2; ~2,300 BOEPD as of July 1 st – 65 MBOEPD FY Guidance  Q2 production negatively impacted by ~4,800 BOEPD due to unplanned third- party fractionation capacity shortfall −Included 2,800 BOEPD associated with inventory build and 2,000 BOEPD from ethane rejection −Inventory build expected to be drawn down by year-end  Increased 2012 production growth target from 61 MBOEPD – 65 MBOEPD to 63 MBOEPD - 67 MBOEPD  Strong drilling and well performance expected to offset continuing ethane rejection (up to 2,000 BOEPD) and an earlier than anticipated reduction in the vertical rig count

28 Horizontal Wolfcamp Play

29 Industry Activity Focused in the Southern Area 29 PXD Acreage Spraberry Field Source: PXD Current Industry horizontal Wolfcamp Shale Focus Area

30 Southern Horizontal Wolfcamp Players PXD COP Devon El Paso EOG BHP Approach Laredo Apache Horizontal Wells Horizontal Permits

31 Horizontal Wolfcamp Rig Count Increasing 43 Wolfcamp Horizontal Rigs 31

32 32 U. Spraberry M. Spraberry L. Spraberry Jo Mill Sand L. Spraberry Shale Dean Wolfcamp A Lower Wolfcamp B Wolfcamp C1 Wolfcamp C2 Wolfcamp D Strawn Upper Wolfcamp B Horizontal Wolfcamp Shale Target Intervals  PXD has an extensive Midland Basin geologic database: −Over 70,000 logs of which 9,000 are digital, allow for excellent structural control and detailed petrophysics −Growing 3-D seismic database (currently at 1,400+ square miles) ensures appropriate well placement −Access to ~4,000 feet of whole core provides increased confidence in petrophysical models and supports repeatable results  Petrophysical analysis has identified multiple prospective horizontal Wolfcamp Shale intervals with substantial resource potential PXD Has Multiple Horizontal Wolfcamp Shale Target Intervals Miss/Atoka

33 33 Strawn Structure CI = 200’ Wolfcamp B1 Structure CI = 200’ Regional Structure Maps: Strawn and Wolfcamp B U. Spraberry M. Spraberry L. Spraberry Jo Mill Sand L. Spraberry Shale Dean Wolfcamp A Wolfcamp B1 Wolfcamp C1 Wolfcamp C2 Wolfcamp D Strawn Wolfcamp B2 Wolfcamp B3 13,820 Control Points 6,558 Control Points 10 Miles

34 34 Platform Carbonate Shelf Edge Carbonate Slope Sediments & Reef Talus Carbonate Debris Flows Carbonate Gravity Flows Land Clastic Detrital Clastic Slope Sediments Clastic Gravity Flows Delta Pelagic Sediments Silt Cloud in Suspension Anaerobic Zone (Organic-rich Sediments) Basinal Sediments Wolfcamp Facies Map Schematic Block Diagram of Wolfcamp Facies In Midland Basin San Simon Channel North Basin Platform Central Basin Platform Glasscock Nose Val Verde Basin Marathon Thrust Belt Fluvial- Deltaic Fluvial - Deltaic Platform Carbonate Clastic Slope Land Carbonate Slope Debris Flow Carb Gravity Flow Clastic Gravity Flow Organic-rich Basinal Sediments Pelagic Sed. Suspended Silt Platform Carbonate Land CBP Midland Basin Marathon Thrust Belt Block Diagram Outline Sea Level North Simultaneous deposition of organic-rich carbonate and clastic sediments in an anaerobic basin results in hydrocarbon-rich, interbedded, conventional and unconventional reservoirs Older Wolfcamp Clastics Wolfcamp Facies & Depositional Model View from NW

35 Wolfcamp Comparison to Other Plays 35 Wolfcamp compares favorably to other major oil shale plays Major Oil Shale Play Characteristics AttributeUnitsWolfcamp Shale 1 Eagle Ford 2 (Oil Window) Barnett Shale 3 (Combo Play) Niobrara 4 Bakken 5 Age PermianCretaceousMississippianCretaceousDevonian/Mississippian Basin MidlandSouth TexasFort WorthDenverWilliston TVD Depthft5, ,0007, ,0005, ,0004, ,0009, ,000 Thicknessft1,500 – 2, OOIP/SectionMMBO80 – Porosity%2 – Quartz%20 – Carbonate%10 – ~ Clay% Permeabilitynd10 - 3, , <10,00050, ,000 Pressure Gradientpsi/ft Recovery Factor% )Pioneer internal research (modified according to recent core and petrophysical data) 2)EOG Analyst Conference April )AAPG Bulletin April 2007, Hart Energy Databank December 2011, HIS, REPSI, EOG February 2010 Investor Presentation 4)Hart Energy Databank December 2011, Oil & Gas Investor June and August )Tudor, Pickering, Holt, “The Bakken Momentum Continues” November 2011, Hart Energy Bakken Playbooks 2008 and 2010, Jarvie – AAPG Section Meeting 2008

36 Horizontal Wolfcamp Shale Drilling Activity 36  Currently focused on holding 50,000 acres in southern part of play during 2012 and 2013 −Expect to drill 90 wells by YE 2013 to hold acreage  5 rigs currently running; increasing to 7 rigs late Q4 −4 rigs drilling in southern area −Recently added 5th rig focused on delineating northern acreage in Midland, Martin and Gaines counties Substantial portion of Pioneer’s acreage position in these counties could be prospective  Currently targeting ~7,000’ laterals; expect to test longer laterals up to 9,000’  Transitioning from “science” drilling to “development” drilling −Results from recent “development” wells suggest wells can be drilled for ~$7 MM −Increasing utilization of Brady Brown ® sand  Railroad Commission of Texas recently adopted new field rules to optimally develop horizontal Wolfcamp Shale and vertical Spraberry Current Drilling Focus Area

37 Horizontal Wolfcamp 960-Acre Development Block 37 5,280 ft Horizontal wells in same interval spaced at ~725’ 7,920 ft 960 acres 467’ from lease line  Up to 55 wells per 960-acre section (20-acre field rules) −41 vertical wells in Spraberry-Wolfcamp −Up to 14 horizontal Wolfcamp wellbores 7 horizontal wells in Wolfcamp A 7 horizontal wells in Wolfcamp B −Additional horizontal wellbores possible in B, C and D intervals  960-acre section metrics (55 wells) −Capital required: $ 180 MM −Resource potential: ~15 MMBOE −F&D cost: ~$15 / BOE  Spacing −Vertical wells 900’ from other vertical wells 360’ from horizontal wells −Horizontal wells 725’ from other horizontals in same interval Stacked horizontals within 300’ in map-view count as one location for spacing purposes 100’ from lease line Vertical Well Horizontal “A” Well Horizontal “B” Well 1 Mile ½ Mile

38 Horizontal Wolfcamp Shale Results Exceeding Expectations 38  Gross cumulative production of 2 Giddings wells in northern Upton county from B interval: −107 MBOE in 9.5 months (75% oil) −83 MBOE in 7 months (75% oil)  Placed 5 additional B interval wells on production during Q2 in southern Upton and Reagan counties  Wells delivered 30-day peak rates ranging from 332 BOEPD to 597 BOEPD (77% to 90% oil)  Continuing to bring new wells on production, including A and B intervals  Expect increasing production rates and EURs as stimulated lateral lengths increased to 7,000’+ PECOS PXD Acreage PXD Initial Drilling Areas Competitor Horizontal Acreage Spraberry Field First 5 wells in southern area First two wells in XBC Giddings Estate Stimulated lateral lengths: 5,300’ Frac stages: 30 EURs: 650 MBOE 1)Based on 7,000’ stimulated lateral with 30 – 35 frac stages; previous EUR range was 350 MBOE – 500 MBOE based on early offset operator data Based on strong production results and continuing petrophysical analysis, increased EURs in southern area to 575 MBOE 1

39 39 Average daily oil production from all 7 horizontal Wolfcamp wells (includes Giddings wells) Average daily oil production from 5 horizontal Wolfcamp wells on University Lands (excludes Giddings wells) Horizontal Wolfcamp Well Performance Above 575 MBOE Type Curve Actual production from horizontal Wolfcamp wells 575 MBOE Type Curve for 7,000’ lateral (oil portion only) Wells unloading fracture stimulation fluid

40 40 Horizontal Wolfcamp Well Performance Above 575 MBOE Type Curve Horizontal Wolfcamp production normalized to 7,000’ lateral 575 MBOE Type Curve for 7,000’ lateral (oil portion only) Wells unloading fracture stimulation fluid Average daily oil production from all 7 horizontal Wolfcamp wells (includes Giddings wells) Average daily oil production from 5 horizontal Wolfcamp wells on University Lands (excludes Giddings wells)

41 41 Wolfcamp Shale JV Opportunity  Offering 33% to 50% of Pioneer’s working interest in ~200,000 acres in southern portion of Midland Basin (8% to 12% of total acreage position) −Large, contiguous acreage position located in Upton, Reagan, Irion and Crockett counties −Includes all intervals (A, B, C & D)  >4,000 potential horizontal development locations excluding downspacing potential  >2.0 billion barrel gross resource potential  Oil content >70%; liquids > 90%  EUR: ~575 MBOE for 7,000’ lateral  ~45% before-tax IRR −$85 oil and $4 gas −$7 MM well cost Proposed JV Area Accelerated development enhances net asset value and project returns

42 1)All drilling locations shown on a gross basis 2)Includes vertical well potential from shalt/silt, Wolfcamp and deeper intervals 3)Assumes average EUR of 575 MBOE per well, >8,000 locations, >400,000 acres, 140 acre spacing, laterals in all intervals (A, B, C & D) and 75% NRI 4)Total PXD Proved Reserves + Estimated Net Resource Potential of >3 BBOE in 2010 and >7 BBOE in 2012 Spraberry 40-ac Drilling MMBOE Spraberry 20-ac Drilling BBOE Spraberry Waterflood 300 MMBOE Horizontal Wolfcamp BBOE Drilling deeper vertical wells, capturing non-traditional shale/silt intervals and drilling horizontally into the Wolfcamp Shale has increased Pioneer’s Permian resource potential by ~400% since Pioneer’s Permian Resource Potential Continues To Grow 1 Spraberry 20-ac Drilling 500 MMBOE Spraberry 40-ac Drilling 350 MMBOE Spraberry Waterflood 300 MMBOE 2010 Permian Resource Potential: 1.15 BBOE Permian Resource Potential: 5.6 BBOE %

43 43 Why Invest In PXD? Significant Upside Potential From:  Oil exposure from proved reserves + estimated resource potential of >7 BBOE and 35,000 drilling locations  Aggressive Spraberry & Eagle Ford Shale drilling program  Extensive horizontal Wolfcamp Shale potential −Joint Venture accelerates future development  Strong returns from vertical integration  Margin protection from attractive derivatives  Strong balance sheet Significant Upside Potential From:  Oil exposure from proved reserves + estimated resource potential of >7 BBOE and 35,000 drilling locations  Aggressive Spraberry & Eagle Ford Shale drilling program  Extensive horizontal Wolfcamp Shale potential −Joint Venture accelerates future development  Strong returns from vertical integration  Margin protection from attractive derivatives  Strong balance sheet

44 Appendix

45 140 MBOE Spraberry 40-Acre Type Curve 45 Gross Production Per Well (BOEPD) Month Strawn / Atoka / Mississippian Potential Not Included 140 MBOE Spraberry/Dean/Full Wolfcamp (70% oil, 20% NGLs, 10% gas) 140 MBOE Spraberry/Dean/Full Wolfcamp (70% oil, 20% NGLs, 10% gas) 110 MBOE Spraberry/Dean/Upper Wolfcamp (70% oil, 20% NGLs, 10% gas) 110 MBOE Spraberry/Dean/Upper Wolfcamp (70% oil, 20% NGLs, 10% gas) Deeper drilling in Spraberry increasing EURs

46 Spraberry 20-Acre Vertical Well Update Acre Drilling (~13,500 locations)  Drilled 39 wells to date – Most wells drilled to the Lower Wolfcamp with a few drilled to the Strawn  Results to date indicate production near type curve for a 40-acre Lower Wolfcamp well (EUR of 140 MBOE)  Targeting ~25 wells in 2012 Spraberry Drilling Rig

47 Spraberry Waterflood Continuing to Perform 47 BOPD Upper Spraberry Base Production (110 wells) Upper Spraberry Base Production Forecast Strong waterflood production wedge from flooded zone; number of responding wells continues to increase  7,000-acre project in Spraberry  12 injectors and 110 producers  Injecting 4,100 BWPD  $6 - $7 MM capital cost  LOE savings from water handling  7,000-acre project in Spraberry  12 injectors and 110 producers  Injecting 4,100 BWPD  $6 - $7 MM capital cost  LOE savings from water handling Water injection begins Continuing to see uptick in production; Upper Spraberry production increased ~25% during Q2 within project area compared to base production decline; further increase expected

48 Permian Oil Production Transport Options 48 Permian Basin Crude Takeaway CurrentOperatorDestinationNameCapacityTime Frame PlainsCushingBasin450,000 SunocoNederlandWest Texas Gulf400,000 Kinder MorganEl PasoWink100,000 Local RefinersLocal 200,000 Rail 20,000 TOTAL1,170,000 PlannedOperatorDestinationNameCapacityTime Frame MagellanHoustonLonghorn (phase I)135,000early-2013 MagellanHoustonLonghorn (phase II)90,000mid-2013 TOTAL225,000 PossibleOperatorDestinationNameCapacityTime Frame Magellan/OxyHoustonBridgeTex278,000mid-2014 SunocoNederlandPermian Express II200,000mid-2014 TOTAL478,000

49 Growing Midstream Infrastructure to Support Production Growth 49 Benedum Sale Ranch Gas Processing  Midkiff / Benedum −Current capacity: 260 MMCFD 1 −PXD production makes up ~40% of throughput  Sale Ranch −Current capacity: 25 MMCFD 1 −Q expansion: +100 MMCFD 1 −PXD production makes up ~40% of throughput  Planned Driver Plant −Online 1Q 2013 −Planned additional capacity: 200 MMCFD 1,2 Pipeline NGL Takeaway to Mont Belvieu  Chaparral & West Texas Pipelines −PXD production throughput of ~13 MBPD in Q −Recent West Texas pipeline debottlenecking providing an additional 4 MBPD to PXD  New Lone Star Pipeline −4 MBPD to PXD in late-2012 increasing to 16 MBPD by 2020 −Will connect to all PXD gas processing plants  Expect >425 MBPD, or ~50%, increase in fractionation capacity at Mont Belvieu in 2013 Expanding processing capacity and contracted takeaway to support Pioneer’s aggressive production growth PXD Acreage Spraberry Field West Texas Pipeline To Mont Belvieu Chaparral Pipeline To Mont Belvieu Midkiff 1) Wet gas stream with ~160 BBL/MMSCF NGL yield 2) Initial capacity of 100 MMCFD with expansion to 200 MMCFD by end of 2013 Planned Driver Plant Lone Star Pipeline (est.) To Mont Belvieu Existing NGL Pipeline Planned NGL Pipeline

50 50 Certain Reserve Information Cautionary Note to U.S. Investors --The U.S. Securities and Exchange Commission (the "SEC") prohibits oil and gas companies, in their filings with the SEC, from disclosing estimates of oil or gas resources other than “reserves,” as that term is defined by the SEC. In this presentation, Pioneer includes estimates of quantities of oil and gas using certain terms, such as “resource,” “resource potential,” “oil in place,” “EUR” or other descriptions of volumes of reserves, which terms include quantities of oil and gas that may not meet the SEC’s definitions of proved, probable and possible reserves, and which the SEC's guidelines strictly prohibit Pioneer from including in filings with the SEC. These estimates are by their nature more speculative than estimates of proved reserves and accordingly are subject to substantially greater risk of being recovered by Pioneer. U.S. investors are urged to consider closely the disclosures in the Company’s periodic filings with the SEC. Such filings are available from the Company at 5205 N. O'Connor Blvd., Suite 200, Irving, Texas 75039, Attention Investor Relations, and the Company’s website at These filings also can be obtained from the SEC by calling SEC-0330.


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