Eon Resources Inc. · AMEX:EONR
Eon Resources — HNR Acquisition — SPAC Merger (September 2023)
36 slides from Eon Resources's SPAC merger presentation, Sep 13, 2023
Slide 1: HNR Acquisition Corp Corporate Slide Presentation September 2023
HNR Acquisition Corp Corporate Slide Presentation September 2023
Slide 2: Disclaimer
Disclaimer • This presentation relates to the potential financing of a portion of a contemplated purchase (the “Purchase”) between HNR Acquisition Corp (“ HNRA ”) and Pogo Resources LLC (“ Pogo”) through a private placement of HNRA’s common stock by potential accredited investors. This presentation
Slide 3: Disclaimer
Disclaimer • The financial information and data contained in this Presentation is unaudited and does not conform to Regulation S - X promulgate d by the SEC. Accordingly, such information and date may not be included in, may be adjusted in, or may be presented differently in, any proxy statement, pr
Slide 4: Disclaimer
Disclaimer • Our ability to complete our purchase; • Our success in retaining or recruiting, or changes required in, our officers or directors following our purchase; • Our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our bu sin e
Slide 5: Executive Summary
Executive Summary
Slide 6: HNR Acquisition Corp (HNRA)
HNR Acquisition Corp (HNRA) Who is HNRA? – HNRA is focused on the acquisition of undervalued oil and gas producing properties with significant development potential at a low cost to realize this potential What are key dates? • Incorporated in Delaware on December 9, 2020 • The registration statement
Slide 7: Target Acquisition: Who is the Target?
Target Acquisition Who is the Target? • To acquire our target acquisition profile, an agreement has been entered into to purchase Pogo Resources, LLC for an aggregate consideration valued at $90 million which includes a net cash equivalent of $63 million. Except for infield drilling through reduced
Slide 8: Target Acquisition: Primary Assets of LH
Target Acquisition What are the Primary Assets of LH? • Proven reserves of $434 million and 550 wells producing oil and gas • Located on the Northwest Shelf of the Permian Basin among prolific legacy oil fields in Eddy County, New Mexico • The assets are on 20 federal and 3 state leases • The leases
Slide 9: Transaction Highlights
Transaction Highlights • Purchase Price and Consideration to the Seller • Net Aggregate : The purchase price is a net aggregate amount of $63 million in cash, which is net of a credit for four months of operating results, and 2 million shares of a new class of Class B Common Stock of the Company whi
Slide 10: HNRA's Reasons for Target Acquisition
HNRA’s Reasons for Target Acquisition • The PV - 10 of proved reserves are $434 million from the Cobb report. • Property is in the Permian Basin which is one of the premier crude and natural gas producing regions in the United States • Property specific attributes: x High certainty of success, as is
Slide 11: Highlights of the Target
Highlights of the Target
Slide 12: Asset Profile
Asset Profile Highlights of the Assets • 95 active waterflood patterns (PDP) with additional 158 patterns planned (PDNP + PUD) • 550 wells (342 producing wells, 207 water injectors, 1 WSW); 98% of wells are active • Current production is primarily from Seven Rivers (7R) • Production is approximately
Slide 13: Seven Rivers Full Waterflood Development
Seven Rivers Full Waterflood Development (Gross BOPD) Projections Seven Rivers Future Development • The projections are based on the Cobb report • 253 pattern total development x 95 PDP patterns x Plus 115 PDNP and 43 PUD patterns x Patterns are a combination of producing wells and water injectors t
Slide 14: Regulatory Production Pool: 7R-Q-GB-SA
Regulatory Production Pool: 7R - Q - GB - SA Period Epoch Approx. Regional Thickness (ft) 200-400 100 1,000 200 200 500 200-500 300 1,500 100 Paddock Blinebry Tubb Drinkard 1,000 Wolfcampian 0-1,500 Guadalupian Leonardian 1,500 Formation Grayburg San Andres Glorieta Yeso Abo Wolfcamp Permian Ochoan
Slide 15: Key Takeaways on the Property
Key Takeaways on the Property • 100% operated, 100% HBP, 74% Average NRI, and 98% of wells are active • Low lifting costs of ~$15/ bbl demonstrated for more than 18 months • Strong 7R waterflood response with over 2 ½ years of performance • Full development plan in the Cobb report triples oil reserv
Slide 16: Key Aspects of the Execution Plan
Key Aspects of the Execution Plan • The Target has had a successful waterflooding approach to increase production. We will continue to follow the development plan from the independent external engineering firm’s report • With HNRA’s planned expansion, production will increase by 2 - 1/2 times over n
Slide 17: Land and Regulatory Overview
Land and Regulatory Overview
Slide 18: Land and Ownership Overview
Land and Ownership Overview • ~13,700 gross acres • 23 Leases (20 BLM and 3 State leases) • 100% WI with 74% average NRI • 100% Operated • 100% HBP • Title opinion coverage on 97% of PDP PV10 value BLM Leases NM State Leases LH Leases with Title Opinion LH Leasehold <75% NRI 75% - 79% NRI 85% - 87.5
Slide 19: Regulatory Overview
Regulatory Overview Regulatory Environment • 7R - Q - GB - SA is considered a single, unitized pool (“pool”) for regulatory purposes and all current production and upside producti on are produced from this single pool • No regulatory approval required prior to performing well - work on an existing w
Slide 20: Field Operation - Employees
Field Operation - Employees
Slide 21: Field Personnel
Field Personnel Experienced Field Personnel (12 company field employees) • 3 Field Supervisors (field, production, and development) with extensive industry experience x Production and Development Supervisors: >15 years industry experience x Field Supervisor: >10 years industry experience • 7 Gaugers
Slide 22: Leadership and Management (after the Purchase)
Leadership and Management (after the Purchase)
Slide 23: Dean Rojas – Chief Executive Officer and Director
Dean Rojas – Chief Executive Officer and Director • Mr. Rojas has 40 years’ experience in the oil and gas industry with most of that experience in energy operations onshore, offshore and internationally • He began his career in 1975 with Exxon Company and grew his career to the District Engineering
Slide 24: Mitchell B. Trotter – Chief Financial Officer and Director
Mitchell B. Trotter – Chief Financial Officer and Director • Mr. Trotter joined the Company in October 2022 • Mr. Trotter has 40+ years of experience beginning his career in 1981 as an auditor with Coopers & Lybrand for seven years. • He then served as CFO of two private investor backed private comp
Slide 25: Jesse J. Allen – Vice President of Operations
Jesse J. Allen – Vice President of Operations • With over 42+ years experience operating and managing onshore and offshore oil and production in the US and internationally, Mr. Allen brings considerable knowledge to his role as VP of Operations. • His expertise includes artificial lift, completions,
Slide 26: David M. Smith, Esq. – VP, General Counsel and Secretary
David M. Smith, Esq. – Vice President, General Counsel and Secretary • Mr. Smith is a licensed attorney in Texas with over 40 years’ experience in the legal field of oil and gas exploration and production, manufacturing, purchase and sale agreements, exploration agreements, land and leaseholds, righ
Slide 27: Donald H. Gorée – Public Markets Consultant
Donald H. Gorée – Public Markets Consultant • Mr. Gorée founded our company and has served as our Chairman and Chief Executive Officer since our inception and will serve as our publics market consultant • Mr. Gorée in 2018 founded Houston Natural Resources, Inc., a global natural resource corporatio
Slide 28: Donald W. Orr – Geological Consultant
Donald W. Orr – Geological Consultant • Donald W. Orr has served as HNRA President and has been a member of our Board of Directors since January 2021 and will serve as our senior geological consultant • Mr. Orr is a geologist with over 42 years of experience in petroleum geology and production opera
Slide 29: Dante Caravaggio – Key Advisor and Consultant
Dante Caravaggio – Key Advisor and Consultant • Mr. Caravaggio has been a key member of the team in identifying the target, structuring the deal, structuring the capital raise and consulting with the management team and board of directors • He will continue in an advisory role after the IBC in devel
Slide 30: Joseph V. Salvucci, Sr – Board of Directors, Chairman (nominee)
Joseph V. Salvucci, Sr – Board of Directors, Chairman (nominee) • Joseph V. Salvucci, Sr. has served as a member of our board of directors since December 2021 • Mr. Salvucci acquired PEAK Technical Staffing USA (“PEAK”), peaktechnical.com in 1986 and has grown the business to be a premier provider o
Slide 31: Joseph V. Salvucci, Jr – Board of Directors
Joseph V. Salvucci, Jr – Board of Directors • Joseph V. Salvucci, Jr. has served as a member of our board of directors since December 2021, and is head of the compensation committee. • Mr. Salvucci began his career with PEAK Technical Staffing USA in November 2010 and is currently serving as the Chi
Slide 32: Byron Blount – Board of Directors (nominee)
Byron Blount – Board of Directors (nominee) • Mr. Blount joins the HNRA Board of Directors and will be the head of the audit committee • Mr. Blount has extensive experience in finance, investments and acquisitions. • He was Managing Director for the Blackstone Real Estate Group from 2011 to 2021 whe
Slide 33: Appendix Technical Backup and Information
Appendix Technical Backup and Information
Slide 34: Pilot Overview
Pilot Overview • LH Operating (“LH”) assets located on the Northwest Shelf of the Permian Basin among prolific legacy oil fields • ~13,700 contiguous acres in Eddy County, New Mexico; 100% HBP • 100% Operated; 100% WI and 74% average NRI Highlights • Significant current net operating cash flow • Cur
Slide 35: Seven Rivers (7R) – Development History
10 100 1,000 10,000 10 100 1,000 10,000 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Seven Rivers (7R) – Development History LH Operating Gross Historical Production (All Horizons) Depositional Setting LH Operating Regional Setting GYBG - JACKSON 120 MMBO Cum MALJA
Slide 36: Seven Rivers (7R) Waterflood Development
Seven Rivers (7R) Waterflood Development 7R PDP Response (95 Patterns) – Gross Oil (BOPD) 7R Waterflood Development Pilot Response Starts Early 2020 Current 7R Waterflood Response • LH Operating’s 7R WF work began late 2019 in the H E West B 4 - pattern pilot with initial production response in Febr