Helmerich & Payne, Inc. · NYSE:HP
Helmerich & Payne — Investor Presentation (March 2019)
28 slides from Helmerich & Payne's investor presentation, Mar 21, 2019
Slide 1: Forward-Looking Statements
Forward-Looking Statements Forward Looking Statements This presentation contains forward-looking statements within the meaning of the securities laws. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words or
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of the securities laws. ForwardJooking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words or variation of words such as
Slide 3: H&P Investment Thesis
H&P Investment Thesis Industry Leader in U.S. Land Drilling FlexRig® Fleet Poised for Continued Market Share Gains Most Capable and Uniform Fleet Outperformed OSX in 8 Out of Last 10* Years Consistent Operational Excellence (Safety, Customer Satisfaction, Reliability) Financial Position and Strength
Slide 4: H&P Today
H&P Today Founded in 1920, H&P is the industry’s most trusted drilling partner. Committed to operational excellence and conservative financial discipline, H&P is the recognized industry leader in drilling as well as technological innovation. We are a global drilling company based in Tulsa, OK with o
Slide 5: Why H&P?
Why H&P? U.S. Land industry leader with dominant position poised for future gains Important to be adaptable in volatile markets Rig release notifications from the beginning of the year have moderated supporting the activity outlook Expect rig count to trough late March/early April timeframe Stock pe
Slide 6: Wellbore Quality & Accuracy: Extracting Higher Value from Shale Assets
Wellbore Quality & Accuracy Extracting Higher Value from Shale Assets Motive and MagVAR acquisitions create a powerful platform and compelling value opportunity for E&P companies Offers flexibility for E&Ps to select best technology regardless of drilling contractor Brings new level of accuracy to d
Slide 7: Extracting Higher Value from Shale Assets
I lmmmm) Extracting Higher Value from Shale Assets > Motive and MagVAR acquisitions create a powerful platform and compelling value opportunity for E&P companies > Offers flexibility for E&Ps to select best technology regardless of drilling contractor > Brings new level of accuracy to directional dr
Slide 8: Motive Drilling Technologies
MOTIVE Drilling Technologies Motive is the industry leader in the use of cognitive computing software to guide the directional drilling process. The Motive Bit Guidance System™ is a directional drilling automation platform. It is a completely new method for steering the drillbit in horizontal and ex
Slide 9: Wellbore Quality Standardization and Repeatability
Wellbore Quality Standardization and Repeatability Which lumber would you use to build your house? Fixing tortuosity is expensive and time consuming . (A) Industry should strive to manufacture horizontal wellbores like the (A) wood pile, the highest quality and accurately placed. Why does it accept
Slide 10: Wellbore Quality = Higher E&P Returns
Wellbore Quality = Higher E&P Returns Source: Society of Petroleum Engineers “Tortuosity values for horizontal, curve and vertical sections are calculated from about 2400 publicly available directional surveys for a basin in the US. The study uses data from hundreds of these wells to reveal correlat
Slide 11: Traditional Directional Drilling Challenges
Planned Trajectory Actual Result Traditional Directional Drilling Challenges Status Quo: Well Design Difficult to Achieve Poor drilling accuracy Missed targets/pay zones Inconsistent Drilling Practices Increased tortuosity, poor hole quality, low rate of penetration and completion issues Downhole To
Slide 12: Science Based Decision Making
Science Based Decision Making Planned Trajectory MOTIVE Result Motive Results (Performance Focused): Improved Accuracy – Well Drilled to Plan Hitting target and more time in pay zone Consistent Drilling Practices Decreased tortuosity, better hole quality, less drilling time and smoother completion F
Slide 13: Bit Guidance System Key Components
Bit Guidance System Key Components Target Zone Convergence Planner Millions of potential options are considered by Bit Guidance System to find the optimal, most economic convergence back to the well plan Convergence considers costs associated with: Drilling speed Risk associated with tortuosity Lost
Slide 14: Motive Bit Guidance System
MOTIVE Bit Guidance System Motive has commercially drilled over 12 million feet on over 800 wells across all of the major U.S. shale plays and Canada Motive has been issued 19 U.S. Patents Today Motive operates on both H&P FlexRigs and competitor rigs The Bit Guidance System converts directional dri
Slide 15: Path Towards Automation
Path Towards Automation Source: Company Using the autonomous car analogy, H&P with its new AutoSlide functionality is entering level 4 out of the 5 levels, where there is still a driver but he is not required to touch the steering wheel except in rare occasions. Motive AutoSlideSM
Slide 16: AutoSlide: The Next Evolutionary Step in Drilling Automation
AutoSlide The Next Evolutionary Step in Drilling Automation Standardizes highest quality well paths by providing automated and optimized slide execution with no human dependency Searches for optimal parameters in real-time to increase ROP and accuracy Adapts to different downhole formations and tool
Slide 17: FlexRig Operating System with AutoSlide
Motive Bit Guidance tells the automation system where, when and how far to slide and controls the FlexRig through the slide. FlexRig Operating System with AutoSlide Source: Company video
Slide 18: H&P FlexRig AutoSlide
H&P FlexRig AutoSlide Currently outperforming very experienced directional drillers Less overall time to drill the curve Improved tool face precision While the Motive Bit Guidance System can be used on all rigs, AutoSlide is only available with FlexRigs today AutoSlide has been running on H&P FlexRi
Slide 19: H&P FlexRig AutoSlide
> Currently very experienced directional drillers > Less overall time to drill the curve > Improved tool face precision > While the can be used on all rigs, is only available with today > has been running on in the Midland Basin over the past year; beta testing complete > One button sliding function
Slide 20: Magnetic Variation Services
Magnetic Variation Services MagVAR is a leading software provider of measurement while drilling (“MWD”) geomagnetic referencing and survey quality management MagVAR’s services: Correct for MWD measurement errors Align drilling objectives to prevent well interference with asset objectives of placing
Slide 21: Wellbore Placement: Optimal Spacing Drives Life of Well Production
Wellbore Placement Optimal Spacing Drives Life of Well Production The path can be as important as the destination The industry is leaving hydrocarbons behind! Reported Actual MagVAR has developed a complete well placement solution that enables highly accurate wellbore placement
Slide 22: Wellbore Accuracy = Higher E&P Returns
Wellbore Accuracy = Higher E&P Returns Conclusion: E&P industry needs accurate wellbore placement to ensure optimal spacing and enhanced returns. Optimal Spacing Drives Life of Well Production “For wells spaced 375 feet apart, the interference could cause a 28% loss in production over the well’s lif
Slide 23: Optimized Wellbore Placement
Optimized Wellbore Placement Reservoir: Directly impacts well performance by increasing stimulate reservoir volume; optimal drainage, more frac wings Completions: improving hydraulic communication Geology: better mapping improves prospectivity Regulatory: greater confidence wells are within boundari
Slide 24: Positional Uncertainties
Positional Uncertainties 3D Ellipsoids given for 95% confidence = 2.79 sigma Error model: ISCWSA OWSG Rev-1 Well Orientation Lateral Length MWD MWD+IFR1 MWD+IFR1+MS (ft) (ft) (ft) (ft) Eastward 11000 345 289 (-16%) 145 (-58%)* Southeastward 11000 300 233 (-22%) 134 (-55%) Southward 11000 229 131 (-4
Slide 25: MagVAR Survey Correction
MagVAR Survey Correction MagVAR high accuracy modeling of the Earth’s crustal magnetic field significantly improves MWD accuracy Reduces the cost and risks associated with positional uncertainty, which include: Reduced oil recovery Well interference Frac hits Poor geological models Real-time center
Slide 26: Wellbore Quality & Accuracy
Wellbore Quality & Accuracy AutoSlideSM MagVAR software enables highly accurate wellbore placement that drives higher life of well production Reduces ellipse of uncertainty providing for optimal well spacing Increases reservoir economics while reducing risks The next evolutionary step in drilling au
Slide 27: H&P Value Creation
H&P Value Creation H&P is the industry leader in U.S. land drilling with the most capable, uniform rig fleet H&P’s uniform FlexRig fleet creates adaptive environment to reach maximum efficiency People – crew training, safety Equipment – standardized parts and supplies Technology – FlexRig operating
Slide 28: Thank you for your interest in H&P
Thank you for your interest in H&P. Our stock is traded on the NYSE, ticker symbol - HP For more information please visit our website at www.hpinc.com or contact: Dave Wilson, CFA, CPA Director of Investor Relations 918-588-5190, investor.relations@hpinc.com Helmerich & Payne, Inc.
Helmerich & Payne — Investor Presentation (March 2019) on 6ix