1 / 13

IPAA Private Capital Conference Quantum Resources an Oil and Gas Acquisition Company

IPAA Private Capital Conference Quantum Resources an Oil and Gas Acquisition Company Don Wolf - CEO August 10, 2006. Quantum Resources Structure. Aspect Energy Alex Cranberg / Don Wolf. General Partnership. Quantum Energy Partners Wil VanLoh / Toby Neugebauer.

zada
Download Presentation

IPAA Private Capital Conference Quantum Resources an Oil and Gas Acquisition Company

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. IPAA Private Capital Conference Quantum Resources an Oil and Gas Acquisition Company Don Wolf - CEO August 10, 2006

  2. Quantum ResourcesStructure Aspect Energy Alex Cranberg / Don Wolf General Partnership Quantum Energy Partners Wil VanLoh / Toby Neugebauer $2 Billion $1 Billion equity closed through July, 2006 Acquisition plus ability to lever up another $1 billion debt Fund Officers Don Wolf, CEO; formerly Westport, UMC, General Atlantic Logan Magruder, Pres & COO; formerly Berry, Barrett Resources Bob Howard, CFO; formerly Bill Barrett Corp, Barrett Resources Russell des Cognets, VP Engr & Ops; formerly Burlington Resources Lance Lauck, VP Acq & Bus Dev; formerly Anadarko Petroleum Corp Business Model Acquire and develop legacy assets Corporate office Quantum Resources Denver Financial Center, Tower 1 1775 Sherman Street, Suite 1525 Denver Colorado 80203 Main Office: 303-861-1170

  3. Employee Of The Month “multi-tasking as usual”

  4. Quantum ResourcesStrategy • Seek large transactions with long-life properties • Hedge production for 4 to 7 years to insure base return assumptions • Enhance base return through leverage, exploitation, operational improvements and selective dispositions • Distribute dividends to partners • Create size and scale for appropriate exit ideally within 5 to 10 years • Repeat above

  5. Quantum ResourcesWhy Now? • Confluence of higher commodity prices and technology improvements • Creates new opportunities within mature fields • Yields lower cost structure due to greater execution efficiency and improved reservoir performance • High transaction volume creates consolidation opportunities • Dispose non-core areas • Build and flip models • Financing strategy • Ability to minimize pricing volatility through hedging • Liquidity of long-term hedges • Option on technology improvements • Better base economics generates new technology

  6. Quantum ResourcesMotivated Buyer Deal Asset Acquisitions, Corporate Acquisitions, Joint Ventures Structures Geographical Onshore North America (up to 20% International); opportunity driven Areas Niche Size $250 million to $1 billion Acquisitions Legacy assets in less favorable areas >60% PDP reserves; long-life reserves Moderate upside potential Operated assets Strengths Motivated buyer Well funded Competitive cost of capital Short valuation and turn-around time Quick closing without financial contingencies

  7. Capital Access Drivers Strategy Opportunity Timing People Track Records Taxes

  8. Marginal Income Tax Rate Tax Rates: 70-90% 1981 36-50% Income Tax Rate (%) High Risk Tolerance Low Risk

  9. Tax Effects • Pre-1981 • Marginal rates of 70-90% • High risk tolerance • Individual high income investors were common • Year-end “rush” with pre-payments • Tax laws motivated investors to shelter income • Post 1981 • Marginal rates of 36-50% • Low risk tolerance • Rigorous economic analysis • Sophisticated institutional and corporate investors • Complex documentation addressing taxes, exits and governance

  10. Has progress made us better? General Partner Leverage Non-leverage Taxable Non-taxable Terra Marine Energy Employees Assets Investment 1 Investment 2 Investment 3 Limited Partner Limited Partner Limited Partner Quantum Resources General Atlantic & Westport

  11. Capital Partners / Lessons Learned • People • Your team is critical to you and your investors • Primary investor consideration • Don’t forget the accountants • Easy to get behind • Accurate and timely reporting is crucial • Tax expertise is essential • Risk tolerance is lower than you think • Positive returns essential to continuity • Communication • Often, full disclosure and accurate

  12. Lessons Learned (continued…) • Reputation • Hard to build and easy to destroy • All references checked which generally excluding the ones you list • Momentum and urgency • Be sure your lead investors are with you • Close with urgency • Stickiness • Success breeds confidence • Partners stay with winners and drop losers • Little things matter • Indicators of personal values • Don’t win a battle and lose a war

  13. Quantum Resources “An exceptionally well capitalized private oil & gas acquisition company comprised of world class partners and a first class management and operating team, focused on longer life oil and gas reservoirs primarily in North America.”

More Related