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IPAA Oil & Gas Investment Symposium April 19 – 21, 2004

IPAA Oil & Gas Investment Symposium April 19 – 21, 2004. Corporate Information. Corporate Headquarters Denbury Resources Inc. 5100 Tennyson Pkwy., Ste. 3000 Plano, Texas 75024 Ph: (972) 673-2000 Fax: (972) 673-2150 Web Site: www.denbury.com.

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IPAA Oil & Gas Investment Symposium April 19 – 21, 2004

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  1. IPAA Oil & Gas Investment SymposiumApril 19 – 21, 2004

  2. Corporate Information Corporate HeadquartersDenbury Resources Inc.5100 Tennyson Pkwy., Ste. 3000Plano, Texas 75024Ph: (972) 673-2000 Fax: (972) 673-2150 Web Site: www.denbury.com About Forward-Looking StatementsThe data contained in this presentation that are not historical facts are forward-looking statements that involve a number of risks and uncertainties. Such statements may relate to, among other things, capital expenditures, drilling activity, development activities, production efforts and volumes, asset values, proved reserves, potential reserves and anticipated growth rates in our CO2 models, 2003 production and expenditure estimates, 2004 capital budget, Genesis projected distributions, and other enumerated reserve potential. These forward-looking statements are generally accompanied by words such as “estimated”, “projected”, “potential”, “anticipated”, “forecasted” or other words that convey the uncertainty of future events or outcomes. These statements are based on management’s current plans and assumptions and are subject to a number of risks and uncertainties as further outlined in our most recent 10-K and 10-Q. Therefore, the actual results may differ materially from the expectations, estimates or assumptions expressed in or implied by any forward-looking statement made by or on behalf of the Company. 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 probable and potential reserves, that the SEC’s guidelines strictly prohibit us from including in filings with the SEC. Contact UsGareth Roberts – President & CEO(972) 673-2030gareth@denbury.comPhil Rykhoek – Senior VP & CFO(972) 673-2050phil@denbury.comLaurie Burkes – Investor Relations Mgr.(972) 673-2166laurie@denbury.com Note: GEOMAP COMPANY has given its permission for us to use their data to create the oil and gas field outlines on the operational maps and to include this material as part of this presentation. GEOMAP COMPANY reserves all rights to this field data.

  3. Corporate Overview • Enterprise Value (3/31/04): - Approximately $1.1 Billion • Total Proved Reserves (12/31/03): - 128.2 Million BOE (91.3 MMBbls Oil / 221.9 Bcf Gas) • Production(4Q03): - 34,590 BOE per Day • Production Profile (4Q03): - Approx. 55% Oil / 45% Gas • Total Debt (3/31/04): - $305 Million • Bank Credit Availability (3/31/04): - $140 Million Reduced Debt by $50 MM in 2003

  4. Average Daily Production (1) (BOE/d) 35,573 34,704 31,185 45% 47% 21,399 45% 16,748 29% 28% 33% 31% 39% 58% 65% 20% 24% 16% 13% 7% (1) Defined as less than $2.00 NYMEX variance Increasing Volumes of Light Sweet Oil from Tertiary CO2 Flooding

  5. 109.5 130.7* 60.2 36.4 87.4 Net Proved SEC Reserve Growth (MMBOE) 128.2 • Reserve life: 10.1 Years (based on 2003 production) • Proved developed reserve life: 6.1 Years (based on 2003 production) • 2003 F&D cost: $8.58 • 3 Year F&D cost: $7.36 Note: Denbury’s Reserves prepared by DeGolyer & MacNaughton*Includes 8.3 MMBOE of reserves sold in 2003 Steady Growth – Low Average Finding Cost

  6. Relative Asset Value Growth per Share 12% CAGR (1) Using constant $27.50 per Bbl and $4.50 per MMBtu price and cost scenarios. (2) Estimate excluding any value for potential or probable reserves, acreage, etc. (3) PV10 of industrial contracts to end of their contractual term; includes 12/31/03 market value of Genesis units received as part of 2003 VPP transaction. Superior Economics

  7. The Denbury Difference • Low-Risk Asset Base • Blend of long-term, lower risk exploitation projects and higher-risk/reward investment opportunities • Low-risk upside through CO2 and Barnett Shale plays • Gulf Coast Region Focus • Largest producer in Mississippi • Operate all significant properties • Strong Balance Sheet to Fund Growth • Conservative spending policy • Consistent hedging strategy • Experienced and Motivated Personnel • 50 technical employees with over 22 years average experience • Team approach to compensation (Top 5 received less than 10% of option grants in 2003) But Denbury’s Unique Advantage is….

  8. Brookhaven Little Creek Lockhart Crossing …Carbon Dioxide (CO2) • Denbury Owns Strategic CO2 Reserves and 183-Mile Pipeline in Mississippi • 12/31/03 Proved Reserves of CO2: 1.6 Tcf (1) • CO2 Can be Used to Recover Additional Oil from Depleted Fields • No CO2 is Sold to Other Oil Operators • Low Cost “Pipeline” of Future Oil Field Acquisitions JacksonDome Jackson Meridian CO2 Pipeline Mallalieu Lazy Creek McComb McComb BatonRouge New Orleans (1) Includes +/- 160 Bcf of reserves dedicated to VPP with Genesis CO2 Play Gives Denbury Predictable, Low-Risk Future Reserve Adds

  9. Current CO2 Sources & Pipelines Permian Basin Permian Basin 42 Fields 155,000 Gross Bbls/d Operator: Multiple (16) CO2 Source: Natural Eastern Gulf Coast Eastern Gulf Coast 3 Fields 8,000 Gross Bbls/d Operator: Denbury CO2 Source: Natural Rockies Great Plains Coal Gasification Plant Rockies 5 Fields – Additional 2 Proposed (Anadarko) 19,520 Gross Bbls/d Operators: Exxon/Chevron/Merit CO2 Source: Natural/Manufacturing CO2 to Canada LeBarge Mid-Continent Mid-Continent 4 Fields 9,800 Gross Bbls/d Operators: Exxon/Anadarko/Chaparral CO2 Source: Manufacturing Sheep Mountain McElmo Dome Bravo Dome Ammonia Plant Ridgeway CO2 Discovery Jackson Dome Gas Plants Prolific Natural Sources of CO2 are Associated with Volcanic Activity and are Very Rare

  10. Denbury’s CO2 Operations • Demonstrated Success in CO2 Flooding • 36% CAGR in tertiary oil production (1) • Little Creek, Mallalieu & McComb Fields • 35.3 MMBOE proved reserves at 12/31/03 • Southwest Mississippi Fields Along Existing 183-mile Pipeline • 40-55 MMBOE of potential reserves • Scheduled for development over 9 yrs • Majority of fields already owned by DNR • Same reservoir as Little Creek and Mallalieu • CO2 capacity: 450 MM/D at current operating pressures • CO2 current deliverability: 250 MM/D • Currently producing: 225 MM/D • Sweet Crude • 40° API Gravity; approximately equal to NYMEX • Finding and Development Costs • $4.00 to $5.00 per Bbl • Operating costs of +/- $10.00/Bbl • CO2 Requirement 10-12.5 Mcf/Bbl • Significant 3rd Party Income • Approximately $5-6 MM/yr of net operating income from industrial sales (1) 1999 to 2003 Demonstrated Success with CO2 Flooding

  11. INJECTION WELL - Injects CO2 in dense phase PRODUCTION WELLS - Produce oil, water and CO2(CO2 is later recycled) CO2 moves through formation mixing with oil droplets, expanding them and moving them to producing wells. Oil Recovery Using CO2 is +/- 17% of Original Oil in Place (Based on Little Creek) Primary recovery = +/- 20% Secondary recovery (waterfloods) = +/- 18% Tertiary (CO2) = +/- 17% CO2 Operations – Oil Recovery Process CO2 PIPELINE - from Jackson Dome CO2 Injection is One of the Most Efficient Tertiary Recovery Methods for Crude Oil

  12. Little Creek Area Net Daily Production vs. CO2 Purchases 2 LCU Net Daily Production by Phase Net Daily Production 2 Production Follows CO2 Injection

  13. 4,000 Total Phase 1 3,000 Phase 2 Net BOPD 2,000 1,000 0 Jan-02 May-02 Sep-02 Jan-03 May-03 Sep-03 Jan-04 Mallalieu, West Field Net Oil Production vs. CO2 Purchases Net Daily Production WMU Net Daily Production by Phase Production Follows CO2 Injection

  14. Summary of Tertiary Economics (1) (2) (3) (1) Includes West Little Creek and Lazy Creek (2) Includes East Mallalieu (3) PV10 of industrial contracts Superior Economics

  15. CO2 Model Assumptions – Phase I Southwest Mississippi Phase I Represents Fields Along Our CO2 Pipeline

  16. 28% Annual Production Growth (2002 – 2008) CO2 Business Model – Phase I Projected Net Oil Production Strong, Steady Predictable Growth in Core Assets

  17. CO2 Business Model – Phase II Cumulative Gross Production to Date: 880 MMBO Denbury Interest Oil and Natural Gas Pipelines in Place Jackson Dome Fields with at Least 5 MMBO of Cumulative Production DenburyCO2 Pipeline EAST MISSISSIPPI Significant Additional Potential Oil Reserves in East Mississippi

  18. CO2 Model Assumptions – Phase II East Mississippi Represents First Phase of East MS Fields

  19. CO2 Business Model – Phase II Projected Net Oil Production Similar Production Profile as Phase I

  20. 21% Annual Production Growth (2002 – 2013) CO2 Business Model – Phases I & II Projected Net Oil Production Combined Phases Yield Predictable Growth Thru 2013

  21. CO2 Business Model – Phases I & II CO2 Requires Less Than 50% of Total Corporate Budget

  22. Possible Future CO2 Projects JacksonDome Jackson Meridian Phase I – W. Mississippi • 75-90 MMBOE Total Net Potential(35.3 MMBOE Proved as of 12/31/03) CO2 Pipeline Potential 80 Mile Pipeline 100-200 MMBblsAdd’lPotentialBeyond Phase II McComb Phase II – E. Mississippi • 80 MMBOE Net Potential BatonRouge New Orleans Potential 120 Mile Pipeline 100-500 MMBblsPotential Significant Potential Beyond Phase I and II

  23. Solid Asset Base • Proved Reserves (MMBOE): 35.3 • Q4 ’03 Prod. (BOE/d): 5,579 • 2004 Est. CAPEX ($MM): $80.7 CO2OPERATIONS Meridian Jackson Dallas • BARNETT SHALE • Approx. 22,000 Undeveloped Acres • Proved Reserves (MMBOE): 3.0 • Q4 ’03 Prod. (BOE/d): 268 • 2004 Est. CAPEX ($MM): $7.5 BARNETT SHALE CO2 Pipeline • EAST MISSISSIPPI • Proved Reserves (MMBOE): 62.5 • Q4 ’03 Prod. (BOE/d): 13,066 • 2004 Est. CAPEX ($MM): $32.4 EAST MISSISSIPPI McComb Baton Rouge Lafayette • ONSHORE LOUISIANA • Proved Reserves (MMBOE): 11.4 • Q4 ’03 Prod. (BOE/d): 8,320 • 2004 Est. CAPEX ($MM): $22.7 ONSHORE LOUISIANA Lake Charles New Orleans Houma • OFFSHORE GULF OF MEXICO • Proved Reserves (MMBOE): 16.0 • Q4 ’03 Prod. (BOE/d): 7,357 • 2004 Est. CAPEX ($MM): $28.7 OFFSHORE GULF OF MEXICO G U L F O F M E X I C O Proved Reserves as of 12/31/03 Several Conventional Plays in Other Areas Add Additional Growth Potential

  24. Capital Budget (1) Projected 2004 2003 Other $7.5 Other $9.1 OffshoreGulf of Mexico $28.7 OffshoreGulf of Mexico $54.0 Jackson Dome (CO2) $31.5 JacksonDome (CO2) $19.7 OnshoreLouisiana $22.7 SW Mississippi (CO2) $25.8 OnshoreLouisiana $33.1 SW Mississippi (CO2) $49.2 E. Mississippi $32.4 E. Mississippi $24.6 $172.0 Million $166.3 Million (1) Excludes acquisitions; includes allocated capitalized overhead Increased Emphasis in 2004 on Core Assets

  25. Financial Data per BOE (1) NYMEX prices based on average of daily closing prices of near month contracts. (2) Cash flow from operations, excluding the change in assets and liabilities. See our website for a reconciliation of Adjusted Cash Flow to Cash Flow from Operations. We Monitor All Revenue & Expenses on a Gross and per BOE Basis

  26. Hedge Position 2004E 2005E 6% of Total Volume 55% of Total Volume Note: For further detail see 10-K Hedging Less as Balance Sheet Becomes Stronger

  27. $676 $736 $748 $415 $225 Debt to Capital Analysis (2) (1) ($ in millions) $350 $341 $300 $225 $193 $199 $153 (1) Excludes accumulated other comprehensive income (loss). (2) Principal amounts; excludes discount on subordinated debt. Balance Sheet Has Become Stronger Over Time

  28. Genesis • Public MLP engaged in Crude Oil Gathering, Marketing and Transportation • Denbury Owns General Partner Interest; Total of Approximately 9.25% • Genesis’ Mississippi Pipeline Runs Near Several of our Key Fields • Genesis May Function as a Financer and Operator of New Pipelines and Gathering Systems Requested by Denbury • Anticipated Distributions of $0.60 per Unit in 2004; $0.80 in 2005 • Denbury Expects Between $2.5 and $3.0 Million of Cash from Genesis in 2004 for Distributions and Service Fees Relating to VPP Genesis Has Enhanced Our Marketing Position in Our Core Areas

  29. Growth Strategy • Low-Risk, Low Cost Reserve Potential for Several Years Through CO2 • Maintain a Strong Balance Sheet • Use Price Floors and Collars to Protect Against Downside Volatility • Shifting More of Our Focus and Spending to CO2 Play • One of Few Companies with Years of Inventory for Future Growth • Core Assets are Growing, Even Though Our Total Production is Currently Flat We Are Growing Our Core Assets

  30. Denbury Stock Performance 2000-2003 Liquidity Continues to Improve, Which Also Helps Stock Price

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