ZaZa Energy Corp. · OTC:ZAZA
ZaZa Energy — Investor Presentation (October 2013)
35 slides from ZaZa Energy's investor presentation, Oct 21, 2013
Slide 1: Investor Presentation
Investor Presentation October 21, 2013 Nasdaq: ZAZA
Slide 2: Forward Looking Statements
Forward Looking Statements Financial Information. This presentation contains certain projections concerning the anticipated future performance of the Company. Such projections reflect various assumptions. These assumptions may or may not prove to be correct. Actual results achieved by the Company in
Slide 3: ZaZa Energy Overview
ZaZa Energy Overview CONSOLIDATING A DOMINANT POSITION IN THE EAGLEBINE High concentration of liquid‐rich assets in the Eaglebine and Eagle Ford trends Contiguous ~110,000 acre presence within the Eaglebine and Lower Cretaceous window Completed amendment to joint venture agreement with large i
Slide 4: Capital & Ownership Structure
Capital & Ownership Structure MODEST LEVERAGE & CONCENTRATED OWNERSHIP Capitalization Table 1 Ownership Statistics 1 ($ in millions) Pro Forma 2 6/30/2013 Cash and Cash Equivalents $22.4 22.7% Restricted Cash ‐ Other 1.1 Restricted Cash ‐ Escrow 15.0 Senior Secured Notes $26.8 13.7% Convertible Seni
Slide 5: Recent Milestones
Recent Milestones POSITIONED FOR RAPID VALUE CREATION Secured a first mover advantage in the Eaglebine/Eagle Ford East play Consummated joint venture agreement with a large independent operator to develop Eaglebine/Eagle Ford East acreage Accelerated original joint venture agreement through an
Slide 6: Quality of Core Asset – Eaglebine Overview
Quality of Core Asset – Eaglebine Overview WORLD‐CLASS UNCONVENTIONAL ASSET Technical evaluation of Regional Cross Section (Flattened on Base of Austin Chalk) the juncture between the organic‐ and carbonate‐ rich Eagle Ford group and the silica‐rich Woodbine plays provided an operational thesis to
Slide 7: Eaglebine/Eagle Ford East Development Targets
Eaglebine/Eagle Ford East Development Targets EVALUATING MULTIPLE PRODUCTIVE FORMATIONS Key 0 GR [GAPI] (CTR) 300 0.2 RT90 [ohmm] 0.45 2000 0.45 NPHI [CFCF] DPHI [%] -0.15 -0.15 20 TOTAL_GASES 20000 Vertical Options Horizontal Options Targets 8300 8400 8500 Austin Chalk Eagle Ford 8600 W 8700 Woodbi
Slide 8: Non‐Core Asset: Eagle Ford Shale Properties
Non‐Core Asset EAGLE FORD SHALE PROPERTIES Sweet Home Overview ~23,000 net acres located in the liquids window of DeWitt and Lavaca County (as of 10/1/2013) +200’ thick Eagle Ford pay section with >8% porosity in thickest portion of organic shale ZaZa Energy Boening Well Adjacent to recent Eag
Slide 9: Vision to Deliver Extraordinary Results
Vision to Deliver Extraordinary Results PROVEN BUSINESS MODEL & EXPERIENCED TEAM Business Model Initial Appraisal • Regional geologic evaluation • Depositional model, subsurface analysis, 3D seismic • Hydrocarbon system, maturity, geochemistry • Begin building subsurface model • In‐depth data analys
Slide 10: Reservoir Evaluation
Reservoir Evaluation ACHIEVING FIRST MOVER ADVANTAGE ZaZa drilled and completed 28 proof‐of‐concept wells from 2011‐2012 Cut and analyzed over 2,000’ of conventional core Recovered over 800 rotary sidewall cores Tested a number of new logging tool technologies for advanced evaluation in unco
Slide 11: Appraisal to Proof‐of‐Concept Phase
Appraisal to Proof‐of‐Concept Phase TECHNICAL CAPABILITIES Depositional Model Thickness, Depth, and Pressure Maturity/TOC/XRD Core Calibrated Petrophysics Mineral Composition and “Fracability” Eaglebine/Eagle Ford Evaluation Process Integration ‐ Pilot to Lateral FRAC Design and Execution Microseism
Slide 12: 2013 ‐ 2014 Game Plan
2013 ‐ 2014 Game Plan ENTERING GROWTH PHASE NOW Demonstrate Value Proposition to the Investment Community Eaglebine Joint Venture: Continue to test and evaluate the play Increase acreage and production Obtain independent resource valuation Other Growth Opportunities: Acquire existing pro
Slide 13: Assets
Assets Yi. ZAZA ENERGY Consolidating a Dominant Position in the Eaglebine/Eagle Ford East Nasdaq: ZAZA 13
Slide 14: Core Asset – Eaglebine/Eagle Ford East
Core Asset – Eaglebine/Eagle Ford East Eaglebine represents the Woodbine Sand/Silt Play area of East Texas where the Higher sand content Eagle Ford Shale transitions into the Woodbine Sands Core Asset Eaglebine/Eagle Ford Play Higher silt content Eaglebine Low resistivity log signature Lower
Slide 15: Amended Eaglebine/Eagle Ford East JV Terms
Amended Eaglebine/Eagle Ford East JV Terms To satisfy obligation of the third well under Phase I from the original agreement, ZaZa receives $1.5 million cash and $1.5 million cash value carry on vertical well(s) Preliminary Partner operates and earns in 75%; ZaZa 25% pro forma Assumptions Tota
Slide 16: Eaglebine/Eagle Ford East JV Overview
Eaglebine/Eagle Ford East JV Overview ZaZa to Receive ~$17.8MM Net Cash plus Production Interests in 23 Wells (~$17MM PDP PV) Net Cash to ZaZa Production Interests to ZaZa Phase II Carry Value to ZaZa 1 PDP Present Phase I $1.5 Working Interest Phase II 16.3 Wells Value 100% 25.0% Total Net Cash to
Slide 17: JV Eaglebine/Eagle Ford East Acreage
JV Eaglebine/Eagle Ford East Acreage ~37,600 net acres to ZaZa (includes 100% remaining former Phase III acreage) ZaZa first Eaglebine test in February 2012 Recent well IPs of 600+ Boe/d support ZaZa’s technical view ZaZa maintains one of the most consolidated acreage holdings in the region
Slide 18: Why Invest in ZaZa?
Why Invest in ZaZa? Nasdaq: ZAZA 18
Slide 19: Investment Thesis
Investment Thesis COMMITTED TO MAXIMIZING SHAREHOLDER VALUE Poised for rapid production and reserve growth Attractive well economics Material position with first mover advantage in the Eaglebine/Eagle Ford East Strong management team Company Has Been Streamlined and is Strategically Position
Slide 20: Recent Eaglebine/Eagle Ford East Completions
Recent Eaglebine/Eagle Ford East Completions DRILLING PACE INCREASING RAPIDLY Active Drillers Anadarko EOG Resources Apache Geosouthern Burk Royalty Halcon Cabot Navidad Resources Centex Energy Sequitur Contango Oil & Gas SM Energy Crimson Energy Partners Treadstone Energy Source: Drilling-Info, inv
Slide 21: Eaglebine/Eagle Ford East is Now Emerging
Eaglebine/Eagle Ford East is Now Emerging SIGNIFICANT INVESTMENT ACTIVITY Small and large E&P companies are investing significant capital, technology and expertise in the Eaglebine/Eagle Ford East play Major Eaglebine Producers 1 (US$ in millions) 2 Company Market Capitalization EOG Resources $50,
Slide 22: Illustrative Lower Eaglebine & Lower Cretaceous Economics
Illustrative Lower Eaglebine & Lower Cretaceous (Buda‐Rose) Economics ATTRACTIVE WELL ECONOMICS Assumed Type Well Economics Lower Lower Eaglebine Cretaceous Wellhead Volumes Gas (MMcf) 3,339 856 Oil (MBbls) 432 107 Total (Mboe) 989 250 Sales Volumes Gas (MMcf) 2,437 514 Oil (MBbls) 432 80 NGL (MBbls
Slide 23: Illustrative Lower Eaglebine Economics
Illustrative Lower Eaglebine Economics ATTRACTIVE WELL ECONOMICS Lower Eaglebine Highlights Well Head Volumes – 989 Mboe Sales Volumes – 1,272 Mboe Drill & Complete – $10 million per well Lower Eaglebine Type Curve 100,000 Gas, MCF/Month Oil, BO/Month 10,000 Monthly Rate 1,000 100 10 0 60 120
Slide 24: Illustrative Lower Cretaceous (Buda‐Rose) Economics
Illustrative Lower Cretaceous (Buda‐Rose) Economics ATTRACTIVE WELL ECONOMICS Lower Cretaceous Highlights Vertical, comingled play Well Head Volumes – 250 Mboe Sales Volumes – 198 Mboe Drill & Complete – $4 million per well Lower Cretaceous Type Curve 100,000 Gas, MCF/Month Oil, BO/Month 10,
Slide 25: Eaglebine/Eagle Ford East Competitive Landscape
Eaglebine/Eagle Ford East Competitive Landscape MATERIAL POSITION Eaglebine Acreage by Operator Source: Company investor presentations and other publicly available information. 1st mover leasing strategy tied up large tracts early making it difficult for competitors to gain a foothold Acreage bl
Slide 26: Proven Management Team
Proven Management Team SIGNIFICANT EXPERIENCE Founded ZaZa Energy, LLC in 2009. Led company into multiple scaled drilling and development JVs in Todd Brooks the Eagle Ford and Eaglebine. Took ZaZa public via reverse merger in early 2012 (Founder, Executive Founder of Neuhaus Brooks Investments,
Slide 27: Appendix
Appendix Yi. ZAZA ENERGY Consolidating a Dominant Position in the Eaglebine/Eagle Ford East Nasdaq: ZAZA 27
Slide 28: Pro Forma Financial Summary
Pro Forma Financial Summary Capitalization Table 1 ($ in millions) Remaining Actual Moulton CEO Eaglebine Pro Forma 2 6/30/2013 Divestiture PIPE Joint Venture 6/30/2013 Cash and Cash Equivalents $3.2 $1.4 $17.8 $22.4 Restricted Cash ‐ Other 1.1 1.1 Restricted Cash ‐ Escrow 15.0 15.0 Senior Secured N
Slide 29: Marketing Advantage
Marketing Advantage Eaglebine Midstream Map Light Louisiana Sweet Atmos crude pricing offers premium relative to WTI (~$8.00 per Bbl) Gas prices benefit from favorable BTU/GPM content and proximity to Houston‐area markets Quality infrastructure in place with available takeaway capacity Nasdaq:
Slide 30: Eagle Ford – Eaglebine Trend
Eagle Ford – Eaglebine Trend Key Points Shale play trends across Texas from the Mexican border up into East Texas, roughly 50 miles wide and 400 miles long with an average thickness of 250’ It is Cretaceous in age resting between the Austin Chalk and the Buda Lime at a depth of approximately 4,0
Slide 31: Upper Cretaceous Shales ‐ Transition of Play Types
Upper Cretaceous Shales ‐ Transition of Play Types Woodbine Group Woodbine Group Eagle Ford Group Boquillas Tuscaloosa Group Tuscaloosa Eaglebine Marine 200 miles Eagle Ford 322 Kilometers Source: Drilling-Info, investor presentations and other publicly available information Lateral equivalents of U
Slide 32: Eagle Ford and Eaglebine Areas Offer Multiple Stacked Targets
Eagle Ford and Eaglebine Areas Offer Multiple Stacked Targets Eaglebine / Eagle Ford Regional Cross Section (Flattened on Base of Austin Chalk) East Area Woodbine sand/silt horizontal play kicked off activity in the Eaglebine in 2009 Lower Eaglebine target is a ~250’ thick “hot” shale across ZaZ
Slide 33: XRD Comparison of Shales
XRD Comparison of Shales Key Points Analysis of Eaglebine vertical sections in several historical wells Eaglebine / Good TOC concentrations Eagle Ford East throughout section: 2% ‐ 9% Tuscaloosa Good silica concentrations Marine Shale (Quartz): 30% ‐ 60% Low expanding clay concentrations mos
Slide 34: Geologic Comparison of Shales
Geologic Comparison of Shales Geologic Comparison Eagle Ford Lower Tuscaloosa Characteristic Shale Eaglebine Marine Shale Depth: 6,500' ‐ 14,500' 10,500' ‐ 12,500' 10,500' ‐ 14,500' Thickness: 75' ‐ 300' 200' ‐ 400' 100' ‐ 250' Porosity: 8% ‐ 12% 8% ‐ 12% 3% ‐ 8% Pressure (psi/ft): 0.50 0.56 0.56 NG
Slide 35: ZaZa Energy Corporation
ZaZa Energy Corporation Nasdaq: ZAZA 35