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8-K - FORM 8-K - ABRAXAS PETROLEUM CORPaxas8k111312.htm
November 2012
Stephens
Exhibit 99.1
 
 

 
2
Forward-Looking Statements
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.
 
 

 
3
Corporate Profile
 Shares outstanding(1)……....... 93.3
 mm
 Institutional……………….. ~59%
 Insider……………………….. ~13%
 Market cap(2) ……………………... $188
 mm
 Bank debt net of cash(1)………. $131
 mm
 PV-10(3)………………………………..
 $276mm
 EV/BOE(1,2,3)………………………….
 $11.13
(1) As of 9/30/12; production inclusive of Blue Eagle interest
(2) As of 10/31/12
(3) As of 6/30/12 inclusive of Blue Eagle interest and CANAXAS reserves. Uses 6/29/12 strip
(4) Based on mid year reserves and 3Q12 production annualized; inclusive of Blue Eagle
 Proved Reserves(3).…………..... 30.8
 mmboe
 % Oil/Liquids……………… ~54%
 % Proved developed….. ~49%
 % Operated PV-10……… ~94%
 Production(1).………………………
 ~4,172boepd
 R/P Ratio(4)………………………….
 20.2x
 2012E CAPEX………………………
 $70mm
 NASDAQ: AXAS
 
 

 
4
Investment Thesis
 Ø Exposure to “core” acreage in top U.S. oil resource plays
 Ø Significant exposure to emerging NAM oil resource plays
Premier
Acreage
Value +
Growth
 Ø Low decline legacy production
 Ø “Manufacturing” model in repeatable resource plays leads to visible growth
 Ø Recent neighboring transactions recognize significant unbooked upside
Proven
Operator
 Ø Company owned rig in Bakken = pad drilling = efficiency gains
 Ø Deep technical and G&G staff
Oil
Weighted
 Ø 53% crude oil and liquids weighted(1)
 Ø Percentage likely to grow meaningfully given capital focus
(1) As of 06/30/12; production inclusive of Blue Eagle interest
 
 

 
5
Business Plan - 2012 & Beyond
 § FOCUS + DELEVER + GROW
 § ReFOCUS Portfolio and CAPEX on Highest Returning Basins
 § Currently: Williston, Eagle Ford, PRB, Permian
 § DELEVER: Actively Pursue Divestitures
 § Properties trading above internal assessment of fair value
 § Lack of scale/high margin production
 § Reduce leverage and maintain that profile
 § Target Debt/EBITDA < 2.0x by YE13 (1)
 § GROW: The Outcome of Sound Investment Decisions
 § Bakken/TFS:
 § Accelerate with company owned drilling rig
 § Eagle Ford:
 § Mobilize rig to commence 10 well program
(1) Excluding building mortgage and rig loan which are secured by the building and rig, respectively. EBITDA definition per bank loan agreement
 
 

 
6
Low Risk Development
Focus On Four Core Positions in Premier Oil Resource Plays Predominately HBP
 § Williston: 23,000+ net acres; Bakken, Three Forks
 § Eagle Ford: 7,300+ net acres: Eagle Ford, Buda
 § PRB: 17,000+ net acres; stacked potential
 § Permian: 40,000+ net acres: conventional & stacked pay opportunities
Premier Positions in Emerging Oil Resource Plays
 § Permian: 40,000+ net acres; exposure to numerous emerging plays
 § Canada: 20,000+ net acres; stealth oil play
Low Risk Conventional Development
 § Williston Basin: Red River/Duperow
 § Permian Basin: Spires Ranch - hz Strawn
 § Permian Basin: Delaware Basin - dry gas
 
 

 
7
ND
MT
WY
CO
UT
OK
Proved Reserves (MMBoe)(1):  30.8
 Proved Developed:  49%
 Liquids:  54%
 Operated (by PV10):  94%
Abraxas Petroleum Corporation
Williston:
Bakken / Three Forks
Permian Basin: Midland/Eastern Shelf
Emerging Cline, Wolfcamp
Permian Basin: CBP Conventional
Rocky Mountain
Mid-Continent
Permian Basin
Gulf Coast
Eagle Ford Shale
High Quality Assets
Alberta
PRB:
Niobrara, Turner
Alberta
Permian Basin: Delaware
Emerging Bone Spring, Wolfcamp
(1) Net proved reserves as of June 30, 2012, including AXAS’ share of
Blue Eagle’s proved reserves per the September 2012 dissolution
 
 

 
8
Reserve / Production Summary
Proved Reserves(1) - 30.8 MMBoe
Production(2) - 4,172 Boepd
Production Mix
Revenue By Production Stream
 
 

 
9
AXAS Production
(1) Includes AXAS’ share of Blue Eagle’s production (50% in Q1 and Q2 2011, 41% in Q3 2011 and 35% in Q4 2011, Q1 2012 and Q2 2012)
Oil/NGL % 34% 35% 36% 39% 43% 44% 48% 48% 52% 53% 53%
Production Net to AXAS(1)
61% Liquids
Growth
Since 1Q10
 
 

 
10
2012 Capital Budget
 § Large inventory of drilling locations in unconventional and conventional oil plays
 § Additional inventory of gas projects await higher gas prices (all HBP)
(1) Unrisked locations based on eight wells (four Bakken and four Three Forks) per 1,280 acre units; 80 acre spacing assumptions in the Eagle Ford Shale; 3-D identified locations in the
 Niobrara Shale play;
(2) Inclusive of 298 net acre pending acquisition at WyCross
Project Area
 
Net Acres
 
Net Unrisked
Locations(1)
 
2012 Drilling
Program
 
2012 Net Capital
($MM)
 
 
 
 
 
 
Gross
Net
 
 
Bakken / Three Forks
 
23,320
 
146
 
32.0
4.8
 
$34.0
Eagle Ford Shale (2)
 
7,306
 
91
 
3.0
0.75
 
$6.1
PRB
 
17,800
 
54
 
1.0
1.0
 
$9.0
Permian Basin
 
41,131
 
NA
 
3.0
3.0
 
$6.3
Pekisko Fairway
 
5,760
 
6
 
1.0
1.0
 
$8.9
Other
 
20,000+
 
-
 
-
-
 
$5.8
Total:
 
123,764+
 
297+
 
37.0
10.6
 
$70.1
 
 

 
11
AXAS Hedges
 
2012
2013
2014
2015
2016
 
OIL - weighted average price
 
$76.00
 
$86.70
 
$94.05
 
$85.00
 
$84.00
 % of 3Q Oil Production
~66%
~71%
~59%
~50%
~47%
 $MM Revenue Protected
$34mm
$42mm
$37mm
$29mm
$27mm
 
 
 
 
 
 
NYMEX-based fixed price swaps:
 
 

 
12
(1) PV10 calculated using strip pricing as of 4/18/12
(2) PV10 calculated using strip pricing as of 6/29/12
Acquisition/Dissolution Reserve Adds
 
 

 
13
Bakken / Three Forks
County
McKenzie
Richland
Burke
Sheridan
Billings
Divide
Roosevelt
Williams
Stark
Dunn
Net Acres
5,535
5,551
3,255
2,261
1,879
1,442
1,367
1,239
563
123
Percent Operated
 55%
30%
 0%
 0%
  0%
 0%
47%
0%
0%
0%
Net Bakken Locations (1)
 17
17
 10
7
 6
 5
4
4
0
1
Net TFS Locations(1)
 17
17
 10
7
 6
 5
4
4
2
1
(1) Unrisked locations based on eight wells (four Bakken and four Three Forks) per 1,280 acre units;
§ 109,658 Gross/23,320 Net Acres
§ ~100% held by production
§ Drilling Inventory:
 § D&M Risked/Identified
 § 409 gross / 64 net
§ $34.0 MM budget
§ Operated
 § Pad-drilling
 § Company owned rig
 § 7 gross (3.62 net)
§ Non-operated wells
 § 2012 to-date
 § 25 gross (1.1 net)
 
 

 
14
Recent QEP/Helis Transaction
§ Approximately 5 Miles East of North Fork
§ Transaction metrics
 § $1.38 bn for 27.6k net acres
 § 10,500 boepd
 § @ $80k/mboepd = $19,600/acre
 § Assumed EUR: 1mmboe
§ Abraxas North Fork
 § 3,314 net acres
 § 1,280 acre units: 8 B/TF wells
 § Locations: 64 gross (19.7 net)
 § Drilled: 4 gross (1.5 net)
 § Remaining: 60 gross (18.2 net)
 § Assumed EUR: 462mboe
 
 

 
15
Bakken / Three Forks
§North Fork
 § 3,314 Net Acres
 § D&M Risked Operated Locations:
 § Drilled: 2 Gross / 1.4 Net
 § Completing: 3 Gross / 1.7 Net
 § Remaining: 26 Gross / 12 Net
§Recent Operated Activity:
 § Ravin 26-35 1H:
 § Cum. production (22 mos): 122 Mboe
§Stenehjem 27-34 1H:
 § Cum. production (14 mos): 120 MBoe
§Ravin 26-35 2H:
 § COMPLETING
§Ravin 26-35 3H:
 § COMPLETING
§Jore Federal 2-11 3H:
 § COMPLETING
 
 

 
16
Bakken / Three Forks
Significant Long Term Investments:
§Raven Drilling:
 § 2000 HP walking rig
 § Dedicated AXAS crew
 § Company owned man camp
 § Allows for significant efficiency gains
§North Fork Water System
 § Will service all North Fork wells
 § Enables AXAS to achieve cost savings via
 centrally located frac pond & disposal well
  
 
 

 
17
Economics:
§~462 mboe recovery
§80% oil; 8% NGLs; 11% gas
§$8.7mm D&C
Parameters
di 99.0
b 1.5
dm 7.0
GOR 1150
Bakken / Three Forks
 
 

 
18
Eagle Ford Shale
§ Blue Eagle Joint Venture:
 § Dissolved as of September 1, 2012
 § WyCross McMullen County:
 § ~25% working interest
 § 6,139 gross / 999 net(1)
 § Eagle Ford: Volatile Oil
§ Jourdantan: Atascosa County
 § 100% working interest
 § ~4,467 gross / 4,399 net
 § Eagle Ford/Buda: Oil
§ Yoakum: DeWitt county
 § 100% working interest
 § 2,097 gross / 1,908 net
 § Eagle Ford: Dry Gas
§ Planned Activity:
 § 10 well program
 § Cobra B1H: Completing
 § Mustang 1H: Currently Drilling
§ Economics (WyCross):
 § EUR 575mmboe
 § $8.0mm D&C
(1) 298 acres pending acquisition
 
 

 
19
Eagle Ford Shale - Core Area
WyCross
§Core of the volatile oil window
§6,139 Gross/999 Net(1)
§Locations (assuming 80s)
 § 77 Gross / 19 net
§Cobra 1H
 § Cum. production (7 mos): 120 MBoe
 § 95% Oil / NGLs
§Cobra B 1H
 § Completion Scheduled 11/12
§Mustang 1H
 § Drilling
§Corvette C 1H
 § Permitted
(1) 298 acres pending acquisition
 
 

 
20
Eagle Ford - WyCross
Economics:
§~575 mboe recovery
§70% oil; 11% NGLs; 20% gas
§$8mm D&C
Parameters
di 99.11
b 1.3
dm 7.0
GOR 1000
 
 

 
21
PRB - Stacked Pay Opportunities
Converse / Niobrara Counties, Wyoming
§ Gross / Net Acres:
 § 20,720 / 17,800
 § Primarily in Converse and Niobrara
 Counties
 § ~2,100 net acres in Campbell County
 § ~90% held by production
§ Drilling Inventory:
 § 54 net locations (3-D identified)
§ Historical Activity:
 § 13 wells (2000 - 2011)
  (8 horizontal / 5 vertical)
§ Recent Activity:
 § Hedgehog State 16-2H (Crossbow)
 § Restricted rate - 400 Boepd
 § > $5.00 per Mcf w/ NGLs
 § 100% working interest
 § Cum (6 months): 79 MBoe
 § 54% Oil / NGLs
 
Brooks Draw:
Sage Grouse 3H:
(Cum Oil 25 MBbl / 50 MBbl EUR)
Prairie Falcon 3H (Niobrara)
Recent Industry Activity:
74 Permits
8 Completions
Porcupine Field:
Hedgehog State 16-2H (Turner)
 
 

 
22
PRB - Hedgehog State 16 - 2H
 
 

 
23
Permian Basin - Ward County Acq.
 
§ Purchase Price… $6.7mm(1)
§ PDP PV -15……… $6.7mm(2)
 § Assumes 5/1/12 Strip
 § 5/1/12 2012 Strip = $2.29
§ Production……... 1,440 mcfepd
§ Reserves……....... 7.613 bcfe
§ Transaction Metrics
 § Production: $4,650/mcfe/day
 § Reserves: $.88/mcfe
§ Upside Potential
 § Producing into low pressure line
 § Emerging Horizontal Plays
 § Previously > 20 bcfe booked PUD reserves
 (net to Abraxas’ interest)
(1) Net of purchase price adjustments
(2) PV10 calculated using strip pricing as of 5/1/12
 
 

 
24
Permian Basin - Spires Ranch
 
§ 5,600 Gross/Net Acres
§ 2012 Activity:
 § 3 gross / net wells
§ Current Activity:
 § Spires 89-1H
 § Cum. Prod (1 mos): 7.8 mboe
 § 86% oil; 9% NGLs
§ Economics:
 § D&C Cost: $1.8 MM
 § EUR: 145 MBoe
 § 54% Oil / NGLs
AXAS owns 100% working interest in Spires Ranch leasehold
5,600 net acres
Nolan
County
Spires 89-1H
 
 

 
25
Permian Basin - Emerging Hz
Spires Ranch (Nolan County)
§Monitoring industry activity
§Geologic evaluation
§Logged shales through Spires 89 1H
Millican Reef (Coke County)
§Monitoring industry activity
§Geologic evaluation
 
 

 
26
Canada - Pekisko + Stealth Play
§ Pekisko Gross / Net Acres:
 § 5,760 (100% WI)
§ Pekisko :
 § D&C Cost: $3.5 MM
 § EUR: 150 MBoe
 § 6 wells on production
§ Planned Activity:
 § Continue to expand acreage position in
 emerging shale play in central Alberta
 § Post accumulation, actively market for
 JV/sale as a commingled package
Tomahawk
Twining
 Pekisko Trend
Alberta, Canada
?
Stealth Oil Play
Recently Drilled
Neighboring Well in
Stealth Oil Play
 
 

 
27
Near-Term Drilling Catalysts
(1) Significant downtime during 30 day IP month
(2) Restricted rate
 
 

 
28
NASDAQ: AXAS