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W HITTIER E NERGY C ORPORATION. ACQUIRE, EXPLORE, EXPLOIT Pritchard Energy Conference January, 2007. Forward-Looking Statement.

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Presentation Transcript

WHITTIER ENERGY CORPORATION

ACQUIRE, EXPLORE, EXPLOIT

Pritchard Energy Conference

January, 2007


Forward-Looking Statement

This presentation includes forward-looking statements made in reliance on the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on Whittier's current expectations and beliefs and are subject to a number of risks, uncertainties and assumptions that could cause actual results to differ materially from those described in the forward-looking statements. Risks, uncertainties and assumptions include (i) risks inherent in the exploration for and development and production of oil and gas and in estimating reserves, (ii) the presence or recoverability of estimated reserves, (iii) the ability to replace reserves, (iv) unexpected future capital expenditures, (v) general economic conditions, (vi) oil and gas price volatility, (vii) the success of our risk management activities, (viii) competition, (ix) regulatory changes, (x) the ability of management to execute its plans to meet its goals and (xi) other factors discussed in Whittier's filings with the United States Securities and Exchange Commission. Whittier assumes no obligation to publicly update or revise any forward-looking statements contained in this presentation, whether as a result of new information, future events, or otherwise.

Cautionary Note to U.S. Investors

The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation, such as “Proved + Probable” or “3-D Supported,” that the SEC's guidelines strictly prohibit us from including in filings with the SEC. U.S. Investors are urged to consider closely the disclosure in our Form 10-KSB, File No. 000-30598, as amended, available from us at Whittier Energy Corporation - Investor Relations and Company Information, 333 Clay Street, Suite 700, Houston, Texas, 77002. You also may obtain this information at the SEC's public reference room, located at 450 Fifth Street NW, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. This filing is also available at the internet website maintained by SEC at http://www.sec.gov.


Corporate Highlights

  • NASDAQ:WHIT

  • Acquires and explores for conventional resources in onshore Texas and Louisiana

  • Current reserves estimated at 50 Bcfe*

  • 70% natural gas; 50% operated; R/P ratio 7 years

  • Current net production: >19 Mmcfed

  • Legacy – 100 year history of growing companies and monetizing

    *includes 2006 mid-year acquisitions estimated additions from 2006 drilling program


Business Strategy

  • Build Well Capitalized Base of Producing Properties

    • Pursue Acquisitions in Core Areas

      • South Texas, Gulf Coast, Permian Basin

      • Significant reserve and production growth potential

      • Negotiated Transactions

    • Generate Drilling Prospects

      • Working Interest dependent on risk and cost

      • Operated and Non-operated

    • Disciplined Investment Approach

      • Continuously review property portfolio

      • Divest of non-core assets


Whittier Core Areas

50 Bcfe est. proved reserves*

Current production over 19 Mmcfed

Net Production (9/06)

Reserves (9/06)

* Includes Westhoff Ranch & Imperial Acquisitions and estimated adds from 2006 drilling program


Oil

Creating Value 2001 to Present

Proved Reserves

  • Growth via Acquisitions

    12 Operated properties

    • $56 million RIMCO acquisition in 2005

    • $28.1 million for two transactions in 2006

  • Growth via Drill Bit

    • 38 New wells scheduled for 2007

    • Approximately 85% success rate in 2006

      Demonstrated Results

    • Net Reserves grew by over 5,000%

    • Net Production grew by over 900%

Daily Average Production

* Includes Westhoff Ranch & Imperial Acquisitions

Gas


Growth Drivers - Acquisitions

Two Acquisitions Completed in 2006

  • 15.9 Bcfe of proved reserves*

  • 6.8 Bcfe of identified 2P resource

  • Net production approximately 3.0 Mmcfed

  • Total purchase price $28.1 million*

    Westhoff Ranch, Jackson County, Texas

    • 75% Operated working interest

    • Current net production of approximately 2.7 Mmcfed

    • Cap Ex budget for 2006 of $2 million

    • Closed June 1, 2006

      Imperial Petroleum

    • Purchased three fields in Texas and Mississippi

    • 50% Average working interest

    • 15 proved undeveloped locations

    • Potential to add approx. 3.0 Mmcfed of net production in 2007

    • Closed August 9, 2006

      * Net of closing adjustments; third party and internal estimates for reserves


Organic Growth

Potential for significant organic growth over next 2 years

  • >90 Probable, possible and 3D supported locations

  • 75 Bcfe of non-proved resources

  • Undeveloped land: > 17,000 net acres

  • 3-D Seismic database: > 2,900 square miles

  • Generating multiple new prospects

    • 4,000 acre S. Texas Olmos prospect

    • Leasing 7 prospects in Crowley area 43 Sq mi 3D

    • Leasing 5 prospects at East Lake Arthur, LA.

    • Reviewing and leasing S TX 3D prospects


2007 Preliminary Capital Budget

  • $39 million budget

  • Drill 38 new wells; 16 operated

  • Continued emphasis on non-proved resources

Capex by Type

Capex by Region


2007 Current Projects

SOUTHEAST TEXAS

2 Yegua wells completing

SOUTH LOUISIANA – 2 Wells

5-15 Bcfe Marg Tex test in East Lake Arthur

1 well in Rayne currently drilling

So. Bosco waiting on pipeline

SOUTH TEXAS – 1 Wells

1 Wilcox non-operated well


2007 Capital Budget 38 Wells to be Drilled

PERMIAN BASIN

2 Wells

SOUTH TEXAS

12 Wells

GULF COAST

24 Wells


2007 Projects

Southeast Texas

SE TEXAS 3D PROJECT

60 sq. mile proprietary survey

Six Nodosaria wells drilled in 2006

Three Yegua wells drilled in 2006

Fourth Yegua well off-structure;may be re-drilled in 2007; Fifth well dry

8-10 Yegua wells planned for 2007

18% working interest, >3 Mmcfed net


2007 Projects

S. Louisiana

EAST LAKE ARTHUR AREA

Retained 50% avg. working interest

Five prospects leased;

5 Bcfe to 30 Bcfe per target

12,000’-16,000’ targets

Rig scheduled 1/07

New 43 Sq. Mile 3D Survey

Five prospects leased

3 Bcfe to 20 Bcfe per prospect

Reviewing three additional prospects

27% working interest


2007 Projects

S. Louisiana

RAYNE PROSPECT

Whittier operated field 19% working interest

offset to 500 MBO well

Currently drilling

SOUTH BOSCO

10,500’ target; updip to production 40% working interest

Waiting on pipeline


Delivering ResultsSouth Texas – Developing Acquired Properties

TOM LYNE FIELD

Drilled 1 well; 1 recompletion

600 Mcfed to 2 Mmcfed

(1 Mmcfed net)

55% avg. working interest

SCOTT & HOPPER FIELD

Drilled 2 wells; 1 recompletion

500 Mcfed to 5 Mmcfed

(1.8 Mmcfed net)

45% avg. working interest

Increased net production from 500 Mcfed to 2.8 Mmcfed


Delivering ResultsGrass Roots Projects

SE Texas 3D Project

Producing >20 Mmcfed (3 Mmcfed net)

9 successful wells drilled

18% working interest

`

DUSON FIELD

Producing 7.3 Mmcfed (500 Mcfed net)

10% working interest

2 internally generated projects added over 3.5 Mmcfed net



Revenue growth mm s
Revenue Growth($MM’s)

*Operating Cash Flow is a Non-GAAP measure. Reconciliation shown on slide 27


Per Share Growth($’s)

Operating Cash Flow is a Non-GAAP measure. Reconciliation shown on slide 27



Production Growth (Average Mmcfed)

*Daily production as of Sept. 01, 2006


Reserve Growth (Bcfe)

Includes Westhoff Ranch & Imperial Acquisitions



Acquisition Margins

$5.86

$3.20


W

Operating Statistics



Reconciliation of Non-GAAP Financial Measures

Operating cash flow represents net income, as determined under generally accepted accounting principles

(“GAAP“), with certain non-cash items added back. Although a non-GAAP measure, operating cash flow is widely

accepted as a financial indicator of an oil and gas company’s ability to generate cash that can be used to internally

fund exploration and development activities and to service debt. This measure may also be used in the valuation,

comparison, rating and investment recommendations for companies in the oil and gas exploration and production

industry. Operating cash flow is not a measure of financial performance under GAAP and should not be considered

as an alternative to cash flows from operating, investing, or financing activities or as an indicator of cash flows or

measure of liquidity.

The following table reconciles Operating Cash Flow for the periods indicated:


Trading Metrics

  • Stock Price as of 12/31/2006: $9.27

  • Number shares outstanding: 12,595,426

  • Market Cap: $116,759,590

  • First 9 months of 2006:

    • Earnings per Share: $0.49

    • Cash Flow per Share: $1.63

    • EBITDA per Share: $1.75

    • P/E: 19:1

    • P/CF: 5.7:1


Summary

  • Track record of growth and value creation

  • Coherent strategy for creating and realizing value

  • Experienced management team executing business plan

  • Diversified base of producing properties

  • Multi-year inventory of drilling projects

  • Strong balance sheet to support business strategy




Management TeamExperience & Diversity

Bryce W. Rhodes

President & Chief Executive Officer

  • Over 25 years of energy industry experience

  • Former V.P. Whittier Energy

  • Director of PYR Energy Corp. since 1999

  • Education: MBA, Stanford Univ.; BA Geology, BA Biology, UC Santa Cruz

Daniel H. Silverman

Executive V.P. & Chief Operating

Officer

  • Over 19 years of energy industry experience

  • Former Managing Director of Acquisition and Divestitures and Director for Torch Energy Advisors

  • Former Manager of Acquisitions and Divestitures for Apache Corp.

  • Education: MS Mineral Economics, Colorado School of Mines; BS Petroleum Engineer, UT Austin

  • Over 13 years of financial experience

  • Former tax director

  • Significant public company experience

  • Education: MPA, UT Austin

Geoffrey M. Stone, CPA

V.P. Finance & Chief Accounting Officer


Oil Hedges

Nymex Contract Price

Total

Ceiling/Swap

Contract

Period &

Type

Volume

Floor

Price

Crude Oil Contracts (barrels)

Swap Contracts:

November 2006 – December 2006 6,000 $58.00

November 2006 – December 2006 6,000 $74.05

January 2007 – June 2007 15,000 $73.85

July 2007 – December 2007 9,000 $73.00

January 2008 – December 2008 48,000 $71.35

Collar Contracts:

November 2006 – December 2006 16,000 $30.00 $34.25

November 2006 – December 2006 3,600 $49.50 $68.60

January 2007 – June 2007 54,000 $47.50 $69.00

January 2007 – December 2007 78,000 $47.50 $69.25

January 2008 – December 2008 48,000 $60.00 $83.00


Natural Gas Contracts

Swap Contracts (mmbtu)

November 2006 – March 2007 151,000 N/A $10.75

April 2007 – October 2007 210,000 N/A 6.97

April 2007 – October 2007 214,000 N/A 9.25

April 2007 – October 2007* 490,000 N/A (0.37)

November 2006 – March 2007 150,000 N/A 8.16

November 2007 – March 2008 152,000 N/A 10.98

April 2008 – October 2008 214,000 N/A 8.65

Collar Contracts (mmbtu)

November 2006 – December 2006 80,000 $7.00 9.51

November 2006 – December 2006 20,000 5.00 6.45

December 2006 – March 2007 300,000 7.50 11.20

November 2006 – March 2007 151,000 9.00 14.50

April 2007 – October 2007 280,000 6.25 7.95

April 2007 – October 2007 214,000 7.50 12.65

November 2006 – March 2007 200,000 7.25 9.75

November 2007 – March 2008 152,000 9.00 16.25

April 2008 – October 2008 214,000 7.50 10.90

November 2006 – November 2006 120,000 6.00 6.90

December 2006 – December 2006 35,000 7.00 9.30

November 2007 – March 2008 150,000 7.75 12.00

April 2008 – October 2008 140,000 6.50 10.25

*these contracts require the Company to pay Houston Ship Channel price and counterparty to pay NY Mercantile Exchange price less $0.37


Source eia and bhi rig count
Source: EIA and BHI Rig Count

U.S. Gas Rig Count vs Production


Source eia and bhi rig count1
Source: EIA and BHI Rig Count

U.S. Oil Rig Count vs Production


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