Cnx Resources Corporation · NYSE:CNX

Cnx Resources — CONSOL Energy — Bank of America/Merrill Lynch Leveraged Finance Conference (November 2011)

22 slides from Cnx Resources's conference presentation, November 2011

  1. Slide 1: Bank of America/Merrill Lynch – Leveraged Finance Conference

    Bank of America/Merrill Lynch – Leveraged Finance Conference CONSOL Energy Inc. – Bill Lyons, EVP and CFO

  2. Slide 2: Cautionary Language

    Cautionary Language This presentation contains statements, estimates and projections which are forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended). Such statements include estimates of reserves and resources, projections and estimates concerning

  3. Slide 3: CONSOL Energy Inc – Corporate Profile

    CONSOL Energy Inc – Corporate Profile The leading diversified fuel producer in the Eastern United States  Ticker: CNX  Headquartered in Pittsburgh, Pennsylvania  Founded in 1860  8,900 Employees  Market Cap = $9.3 Billion  EV = $12.5 Billion  2010 Revenue = $5.2 Billion 3

  4. Slide 4: The Investment Thesis

    The Investment Thesis • Long-lived, low-cost coal and natural gas assets with solid growth potential • Expanding our product mix and market reach to drive margin expansion • Highly contracted thermal position for 2012; natural gas approx. 50% hedged • Conservative balance sheet with $2.8 billion of

  5. Slide 5: CONSOL Energy - Overview

    CONSOL Energy - Overview CONSOL Energy Inc. Coal Natural Gas  Over 4.4 billion tons of proven and probable  Over 3.7 Tcfe of proved reserves (as of coal reserves (as of 12/31/10) 12/31/10)  2011 estimated coal exports of approximately  Approx. 737,000 gross Marcellus shale acres 10.0 - 10.5 MTs

  6. Slide 6: Product Diversity and Expanding Our Reach

    Product Diversity and Expanding Our Reach  COAL  Low-Vol Coal  High-Vol Coal  PCI Coal  Thermal Coal  Adding Mid-Vol  GAS  Marcellus Shale  Utica Shale  Coalbed Methane  Shallow Conventional  Adding Oil/Liquids 6

  7. Slide 7: Coal Division’s Growth Strategy

    Coal Division’s Growth Strategy Growth Projects Targeting Expanding Export Market • Growing Production Through 2015 • Amonate - 400,000 tons in 2012 - 800,000 tons in 2015 • BMX - 5 million tons annually beginning in 2014 • Growing Exports – Exports to Rise 50% in 2011 • 2010 Exports of 6.8 million

  8. Slide 8: Strength in Market Diversity

    Strength in Market Diversity • CONSOL Ships To Four Continents • Widening of The Panama Canal Should Improve Shipping Costs and Potential Coal Prices 8

  9. Slide 9: Expanding our Exports to 10 - 10.5 MTs in 2011

    Expanding our Exports to 10 - 10.5 MTs in 2011 2010 Coal Exports by Geography (million tons) 2011 Est. Coal Exports by Geography (million tons) 6.8 Million Tons 10 – 10.5 Million Tons Europe 2.2 32% Europe 30% Asia Asia 3.0 50% 44% S. America 1.6 S. America 24% 20% 9

  10. Slide 10: CONSOL’s Industry-Leading Coal Margins

    CONSOL’s Industry-Leading Coal Margins Low-Vol High-Vol Quarter Ended September 30, 2011 Met Met Thermal Total Coal Sales (millions of tons) 1.5 1.0 12.4 Average Realized Price Per Ton – Company Produced $208.51 $83.76 $59.97 Total Cost Per Ton, before DD&A $65.97 $54.93 $46.60 DD&A Per Ton $6.73 $7

  11. Slide 11: Coal Sales Guidance (as of October 27th, 2011)

    CONSOL Coal Sales Guidance (as of October 27th, 2011) 4Q 2011 2011 2012 2013 Estimated Coal Sales (millions of tons) 14.7-15.3 62.0-62.6 59.5-61.5 60.5-62.5 Met Coal Sales at Midpoint 2.6 10.5 10.15 10.35 Percentage Firm Pricing 100% 93% 23% 4% Thermal Coal Sales at Midpoint 12.4 52 50.5 51 Percenta

  12. Slide 12: Our Gas Division Strategy

    Our Gas Division Strategy Pulling Value Forward: CNX sold an interest in its Marcellus and Utica Shales • Economically Develop Our 3P Reserves • Marcellus Drilling – JV with Noble Energy • Coalbed Methane • Further Delineate Key Operational Areas • West Virginia Marcellus • Explore To Set Up Future

  13. Slide 13: Notable Achievements in Shale Formations

    Notable Achievements in Shale Formations Second to produce from a horizontal well in the Marcellus Shale (October 2008) First to announce a discovery in the Utica Shale (October 2010) First to use rotary steering tools in the Marcellus Shale First to use fully-lined sites First to use closed lo

  14. Slide 14: First to Drill a 10-Well Pad in the Marcellus Shale

    …….First to drill a 10-Well Pad in the Marcellus Shale Driving CONSOL’s goal to be a Low-Cost Leader in the Marcellus 14

  15. Slide 15: Capital Program De-Risked Through Joint Ventures and Asset Sales

    Capital Program De-Risked Through Joint Ventures and Asset Sales •Partnering with Noble Energy in the Marcellus Shale, for $3.3 billion •Partnering with Hess Corporation in the Utica Shale in Ohio, for $0.6 billion •Sold ORRI in 115,000 acres in the Marcellus Shale to Antero for $0.2 billion •Contin

  16. Slide 16: Pulling Value Forward: CNX sold an interest in Marcellus Shale to Noble Energy

    CONSOL Energy & Noble Energy JV Pulling Value Forward: CNX sold an interest in Marcellus Shale to Noble Energy  Total deal consideration of $3.3 billion or $9,650 per net acre  Sold 50% interest in Marcellus Shale (628,000 gross acres in PA & WV) for $3.10 billion  Cash: $1.0 Billion paid in 3 an

  17. Slide 17: Marcellus Shale JV Acreage

    CONSOL Energy & Noble Energy JV Marcellus Shale JV Acreage  CNX/NBL Operating Areas – 85% HBP  CONSOL – Dry Gas Areas  ~ 467K acres  ~ 3,100 horizontal locations (85%)  Noble Energy – Wet Gas Areas  ~ 161K acres  ~ 1,000 horizontal locations (15%)  High net revenue interest (88%)  Marcellus

  18. Slide 18: CONSOL Energy & Noble Energy JV Development Plan

    CONSOL Energy & Noble Energy JV Development Plan  Rig schedule ramps up to 16 by 2015  Accelerated development of acreage  Substantial cash generation throughout plan Note: The net proceeds can change with the carry moving in and out of suspension with three months of Henry Hub gas at $4/MMBTu 18

  19. Slide 19: Raising Exploration and Oil Exposure: CNX sold an interest in Utica Shale to Hess

    CONSOL Energy & Hess Corporation JV Raising Exploration and Oil Exposure: CNX sold an interest in Utica Shale to Hess Corporation  Total deal consideration of $594 million or $6,000 Per Acre  Sold 50% interest in Utica Shale position (200,000 gross acres in OH)  Cash: $60 million – received at cl

  20. Slide 20: Utica Shale JV Acreage

    CONSOL Energy & Hess Corporation JV Utica Shale JV Acreage 20

  21. Slide 21: Our Assets, Strategy and People Create An Investment Opportunity

    Our Assets, Strategy and People Create An Investment Opportunity • Coal and gas operations are long-lived, low-cost, and provide solid growth • Our well capitalized assets provide more consistent operational execution • Asset rich company that has an expanding products mix and market reach • New par

  22. Slide 22: CONSOL Energy Inc. – Questions?

    CONSOL Energy Inc. – Questions? 22

CONSOL Energy — Bank of America/Merrill Lynch Leveraged Finance Conference (November 2011) on 6ix