Evolution Petroleum Corporation, Inc. · AMEX:EPM
Evolution Petroleum — Investor Presentation (August 2017)
25 slides from Evolution Petroleum's investor presentation, August 2017
Slide 1: Evolution Petroleum Corporation Corporate Presentation – August 2017
Evolution Petroleum Corporation Corporate Presentation – August 2017 Corporate Presentation – August 2017 1
Slide 2: Forward Looking Statements
Corporate Presentation – August 2017 Forward Looking Statements This presentation contains “forward-looking statements.” Such statements may relate to capital expenditures, drilling and exploitation activities, production efforts and sales volumes, Proved, Probable, and Possible reserves, operating
Slide 3: Texas / Gulf Coast Focus Overview
Corporate Presentation – August 2017 Texas / Gulf Coast Focus Overview (Quarter Ended March 31, 2017) New York Stock Exchange EPM Shares Outstanding 33.1 MM Fully Diluted Shares 33.2 MM Delhi Field Share Price (8/7/2017) $7.85 Total Equity Value (8/7/2017) $260 MM Common Stock Dividend (Annual Rate)
Slide 4: Summary Financial Statements March 31, 2017
Corporate Presentation – August 2017 Summary Financial Statements March 31, 2017 Amounts in $000’s, except EPS Balance Sheet Income Statement Cash $ 20,220 Delhi field revenues $ 9,525 Other current assets 4,117 Lease operating expenses 2,811 Property and equipment 62,817 DD&A and accretion 1,537 Ot
Slide 5: Recent Developments
Corporate Presentation – August 2017 Recent Developments Dividend Increased to $0.30 per Year § Rate up 50% Since September 2016 NGL Plant Complete and Online $27.5MM Litigation Settlement Proceeds § Greatly Improves Financial Strength § Removes Uncertainty and Continuing Legal Costs Redemption of a
Slide 6: Investment Considerations
Corporate Presentation – August 2017 Investment Considerations § High Quality Asset Base w/ Near-Term Growth Catalysts § Extremely Long-Lived Production (25 Year Life; Much Longer with Higher Oil Prices) § Debt-Free Balance Sheet with Solid Working Capital Position § Positive Net Income reported in
Slide 7: Delhi Field Recycle Facility and NGL Plant
Corporate Presentation – August 2017 Delhi Field Recycle Facility and NGL Plant Foundation Cash Flow Asset for Evolution Petroleum 7
Slide 8: Delhi Field EOR Project Development
Corporate Presentation – August 2017 Delhi Field EOR Project Development Exceptional resource: Other advantages: § 418 MMBO of gross original oil in place § No LA oil severance taxes (12.5%) § 323 MMBO OOIP in proved flood area until financial payout of the project § 195 MMBO production prior to EOR
Slide 9: Delhi Field Daily Oil Production
Corporate Presentation – August 2017 Delhi Field Daily Oil Production Gross Net BOPD Gross and Net BOPD BOPD 10,000 4,000 9,000 3,500 8,000 3,000 7,000 2,500 6,000 5,000 2,000 4,000 1,500 3,000 Reversion of Working 1,000 2,000 Interest – Nov 2014 500 1,000 - - Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-
Slide 10: Delhi Field - Net Daily Oil Production
Corporate Presentation – August 2017 Delhi Field - Net Daily Oil Production 2,200 2,042 25% Production Increase 2,000 since reversion 1,800 1,640 1,600 1,400 1,200 1,000 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Average Net Delhi Production by Quarter (BOPD) 10
Slide 11: EPM Interests in the Delhi Field
Corporate Presentation – August 2017 EPM Interests in the Delhi Field Costs Revenues Working Interest (a) 23.9% 19.0% Royalty Interests None 7.2% Combined Interests 23.9% 26.2% (a) Field Payout and Reversion of Working Interest to EPM Occurred Effective November 1, 2014 (Working Interest in the Meng
Slide 12: Delhi Operating Costs per BOE
Corporate Presentation – August 2017 Delhi Operating Costs per BOE $24.00 NGL Opex 140 CO2 Purchases & Transp $20.00 Electricity 120 $18.15 R&M/Labor/Chemicals $16.41 Purchased CO2 MMcf/d $16.00 100 $13.53 $13.82 $13.13 $13.14 $12.54 $11.72 $12.00 80 $8.00 60 $4.00 40 $0.00 20 Jun-15 Sep-15 Dec-15 M
Slide 13: EPM Delhi Reserves – Three Cases
Corporate Presentation – August 2017 EPM Delhi Reserves – Three Cases § Proved Reserves assume 13.8% (MBOE – 6/30/16) Incremental CO2 Recovery (Up from 13.0% in 2015) 20,000 § (a) 2P Combined Proved plus 18,034 Incremental Probable assumes 15,320 18.0% incremental CO2 recovery 15,000 § (b) 3P Combin
Slide 14: Oil Price and Discount Rate Sensitivities
Corporate Presentation – August 2017 Oil Price and Discount Rate Sensitivities Combined Values as of June 30, 2016 ($MM) $450 Three Important Variables: Net present value, $400 discounted at: 1) Oil Price Expectations $350 10% 8% 6% 2) Ultimate Reserve Recovery $300 3) Appropriate Discount Rate $250
Slide 15: Delhi NGL Plant
Corporate Presentation – August 2017 Delhi NGL Plant Photo Taken in October 2016 15
Slide 16: Delhi NGL Storage Tanks
Corporate Presentation – August 2017 Delhi NGL Storage Tanks 2,000 Bbl+ Capacity Each 16
Slide 17: Inside General Electric LM-2500 Turbine
Corporate Presentation – August 2017 Inside General Electric LM-2500 Turbine Approx 25 Megawatt Max Capacity 17
Slide 18: Multiple Projects To Build Long-Term Value
Corporate Presentation – August 2017 Multiple Projects To Build Long-Term Expand CO2 Flood to Mengel Sand and Value Infill Drilling program; Expand Additional Thinner Intervals CO2 Flood to (Price Dependent) Eastern Part of Delhi Field (Price Dependent) Increase Production & Improve EOR Efficiency t
Slide 19: Key Financial Matters
Corporate Presentation – August 2017 Key Financial Matters 19
Slide 20: Delhi Capital Spending by Quarter
Corporate Presentation – August 2017 Delhi Capital Spending by Quarter $7,500 Cum Capex – Mar 2017 NGL Plant - $26.3 MM Conformance - $5.6 MM (Post Mar 2015) $5,000 $2,500 Forecast $0 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17e Sep-17e Dec-17e NGL Plant Conformance and Other Fore
Slide 21: Credit Agreement Strengthens Financial Flexibility
Corporate Presentation – August 2017 Credit Agreement Strengthens Financial Flexibility $50MM Reserve-Based Credit Agreement with MidFirst Bank – Financially Strong Private Bank § Initially Elected Borrowing Base of $10MM § Attractive Rate Structure: Mid-3% Range All-in § 25 Basis Points on Undrawn
Slide 22: Defensive Hedging Strategy
Corporate Presentation – August 2017 Defensive Hedging Strategy § Goals for Hedging Program: Protect Dividends and Cap Ex Obligations Retain Long-term Commodity Price Upside § Policy allows Hedging of Maximum 70% of Estimated Production not to exceed one year forward Started Program in 2H 2015 – Rea
Slide 23: EPM Dividend History vs WTI Oil Prices
Corporate Presentation – August 2017 EPM Dividend History vs WTI Oil Prices $0.12 $120 $0.11 Cumulative Payout Dec 2013 thru Jun 2017: $0.10 $100 $34.6 MM ($1.06 per share) $0.09 $0.08 Sept-17 Dividend set at $0.075 $80 $0.07 Quarterly WTI Avg $0.06 $60 Dividend Oil Prices Rate per $0.05 (Bloomberg)
Slide 24: Opportunities for EPM
Corporate Presentation – August 2017 Opportunities for EPM § We see an Improving Market for Acquisitions Price and Value Expectations more Reasonable Excess Capital Available; Competition Still a Factor § Over time, we expect to see a continuing rationalization of mature conventional cash flow prope
Slide 25: Value Proposition Summary
Corporate Presentation – August 2017 Value Proposition Summary § Accretive Growth § Delhi Field Production Increasing from CO2 Flood Enhancements § Low-Cost Reserves Additions and Upgrades § Start up of the NGL Plant at Delhi Field § Underlying Value § Long-Lived Cash Flow from Very Large Delhi Fiel
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