Patterson-uti Energy, Inc. · NASDAQ:PTEN
Patterson-uti Energy — Credit Suisse Energy Summit 2012
35 slides from Patterson-uti Energy's conference presentation, Feb 8, 2012
Slide 1: Credit Suisse Energy Summit
Credit Suisse Energy Summit Exhibit 99.1 Patterson-UTI Energy, Inc. Patterson-UTI Energy, Inc. Credit Suisse Energy Summit February 8-9, 2012 February 8-9, 2012
Slide 2: Forward Looking Statements
2 2 This material and any oral statements made in connection with this material include "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Statements made which provide the Company’s or management’s intentions, beliefs, expectations
Slide 3: A Transformation in the Energy Industry
3 The Energy Environment PTEN’s Land Drilling Business PTEN’s Well Stimulation Business PTEN’s Strategy PTEN Investment Highlights Conclusions A Transformation in the Energy Industry… Presentation • • The Energy Environment • • PTEN’s Land Drilling Business • • PTEN’s Well Stimulation Business • • P
Slide 4: Changing Energy Environment
4 Source: US Energy Information Administration, Short-Term Energy Outlook, January 10, 2012 Decades of Declining US Crude Oil Production… Reversed in 2009 4.0 4.5 5.0 5.5 6.0 6.5 7.0 7.5 Changing Energy Environment
Slide 5: Changing Energy Environment
5 Source: US Energy Information Administration, Short-Term Energy Outlook, January 10, 2012 Petroleum Imports as a Percent of Total Consumption… More Demand Being Satisfied With US Production 0% 10% 20% 30% 40% 50% 60% 70% Changing Energy Environment
Slide 6: North America Land-Based Energy
6 Unconventional drilling and well completion has evolved: A “manufacturing” approach to drilling and well completion Focus on oil & liquids rich plays Unconventional drilling and well completion techniques being applied to historically conventional plays North America Land-Based Energy Unconvention
Slide 7: PTEN is well positioned in the two gating areas
7 PTEN is well positioned in the two “gating” areas Land-based drilling Well stimulation Frac equipment well-suited to “new wells” Rigs well-suited to “new wells” Changing Energy Environment North America Land-Based Energy PTEN is well positioned in the two “gating” areas • • Land-based drilling • •
Slide 8: PTEN's Drilling Business
PTEN’s Drilling Business Land-Based Drilling Land-Based Drilling PTEN’s Drilling Business
Slide 9: A manufacturing approach to drilling
9 A “manufacturing” approach to drilling Repetitive, assembly line type drilling More plays with multi-well pads Laterals are getting longer Very rig intensive approach to drilling “Preferred” equipment for these “new wells” 1000 to 1500 HP drawworks High capacity mud pumps Top drives Automated dril
Slide 10: New and Well-Suited Rigs
APEX 1500 ™ TM APEX 1000 ™ TM APEX Walking ™ TM Other Electric Rigs 10 New and Well-Suited Rigs as of December 31, 2011 61 15 45 54 175 by the end of 2012 38 13 40 54 …and Expected as of December 31, 2012 APEX 1500 APEX 1000 APEX Walking Total New Rigs Total New Rigs Other Electric Rigs Class Class
Slide 11: New APEX Rigs Have Significantly Increased Fleet Quality
11 New APEX Rigs Have Significantly Increased Fleet Quality. 0 20 40 60 80 100 2008 2009 2010 2011 2012E 120 140 Land-Based Drilling 30 New Rigs expected to be added in 2012 30 New Rigs expected to be added in 2012
Slide 12: Increasing focus on oil & liquids rich plays
12 Increasing focus on oil & liquids rich plays Horizontal drilling techniques developed for shale gas have been a “game changer” for oil and liquids rich shales Approximately 60% of PTEN operating rigs are drilling for oil or liquids “Fit-for-purpose” rigs are very active in oil & liquids rich play
Slide 13: PTEN's Active Rigs in Unconventional Areas
13 PTEN’s Active Rigs in Unconventional Areas as of February 2012 Bakken 20 Rigs 5 Rigs Piceance 7 Rigs Marcellus 30 Rigs Barnett 16 Rigs Eagle Ford 29 Rigs Haynesville 23 Rigs Niobrara 1 Rig Utica 4 Rigs Pinedale Woodford 6 Rigs PTEN’s Active Rigs in Unconventional Areas as of February 2012 Land-Ba
Slide 14: Three types of land rigs for new wells
14 PTEN has designed three types of land rigs for these “new wells”: Each designed to meet customer demands in different markets Each has specific applications for which it is “most suitable” Significance: Drilling is an integral part of the well “manufacturing” business rig moves APEX Walking ™ rig
Slide 15: APEX 1000, APEX 1500, APEX Walking
15 APEX 1000™ APEX 1500™ APEX Walking™ •1000 hp AC drawworks •Small footprint, big rig capability •Fast move & rig- up •Walking system is an optional feature •1500 hp AC drawworks •Great all purpose rig •Fast move & rig- up •Ideal for Eagle Ford, Barnett, and Haynesville •1000 to 200 hp drawworks •A
Slide 16: Video of Walking Rig Moving
Land-Based Drilling Video of Walking Rig Moving Video of Walking Rig Moving
Slide 17: Other rigs in the fleet
17 PTEN has approximately 180 other rigs in the fleet Approximately 100 of these are active as of February 2012 As oil and “other liquids” plays emerge, these rigs should be in greater demand Land-Based Drilling • • PTEN has approximately 180 other rigs in the fleet • • Approximately 100 of these ar
Slide 18: Preferred provider for conventional drilling rigs
18 PTEN is a “preferred provider” for conventional drilling rigs Major upgrade program has provided: PTEN commitment to customers and service PTEN’s large fleet provides substantial “upside” if drilling continues to increase Improved mud systems Iron roughnecks and other automation Enhanced mobility
Slide 19: Long term contracts
19 Long term contracts PTEN expects to average 120 rigs under term contract in 2012 including 131 in the first quarter Approximately 60% of active rigs in the US are committed under term contracts Term contracts have an initial duration of at least 12 months Provides estimated future dayrate drillin
Slide 20: PTEN's Pressure Pumping Business
PTEN’s Pressure Pumping Business Well Stimulation Well Stimulation PTEN’s Pressure Pumping Business
Slide 21: Changing Significance of Well Stimulation
21 Changing Significance of Well Stimulation Shale and other unconventional plays changed the business Changing equipment (“quints”) and crew competencies Key to unlocking long laterals and greatly increased shale production Substantial increases in horizontal completions Increasing number of stages
Slide 22: Pressure pumping
22 Pressure pumping PTEN has been in the business for more than 30 years Well positioned for Eagle Ford, Marcellus, and Utica shales Strong regional management and infrastructure Consistent reputation for customer service and operational excellence Strong, long-term record of organic growth in reven
Slide 23: Service Areas
23 Service Areas Well Stimulation Service Areas Northeast Region Southwest Region
Slide 24: Fracturing Equipment
24 Fracturing Equipment Nitrogen / Cement / Acid 183 Quintiplex 91 Triplex 130 Pumpers 549,500 HP 81,570 HP As of December 31, 2011 …and Expected as of December 31, 2012 239 Quintiplex 91 Triplex 133 Pumpers 689,500 HP 84,600 HP Well Stimulation Fracturing Equipment Nitrogen / Cement / Acid Unit Uni
Slide 25: Long-term contracts in pressure pumping
25 Shortage of quality equipment & crews has encouraged long-term contracts in pressure pumping PTEN has 5 frac crews under term contract 1 in S. Texas 2 in Permian 2 in Marcellus Approximately 155,000 HP under term contract Currently in negotiations for additional commitments Well Stimulation • • S
Slide 26: PTEN's Strategic Approach
PTEN’s Strategic Approach PTEN’s Strategic Approach
Slide 27: PTEN's Strategic Approach
27 Concentrate on two core businesses Plan to continue to grow organically PTEN has the balance sheet and expected cash flow to support continued organic growth in both businesses Acquisitions and dispositions only when the price is right Customer demand in both businesses support term contracts PTE
Slide 28: PTEN Investment Highlights
PTEN Investment PTEN Investment Highlights Highlights
Slide 29: Components of Total Revenue and Operating Income
29 Components of Total Revenue Operating Income Contract Drilling 65% Pressure Pumping 33% Oil & Natural Gas 2% Contract Drilling $346,083 Pressure Pumping 193,440 Oil & Natural Gas 23,982 Corporate & Other (37,904) PTEN Investment Highlights Components of Total Revenue Operating Income Contract Dri
Slide 30: History of returning capital to investors
30 No equity sales in more than 11 years History of returning capital to investors Stock Buyback Total of $592 million in 2006 through 2008 Cash Dividend Initiated cash dividend in 2004 Quarterly dividend currently $0.05 per share PTEN Investment Highlights • • – • – • •
Slide 31: Leading market position
31 Leading market position One of the “Big 3” US land drillers One of the largest pressure pumping companies in the US Well positioned to grow organically and through opportunistic acquisition Diverse asset base Drilling rigs well-matched to customers’ needs Well stimulation assets that meet custome
Slide 32: Flexible operating model and financial strength
32 Flexible operating model Maximizes earnings growth during periods of increased activity Minimizes costs during periods of low activity Strong cash flow generation Strong management team Prudent financial management Operational management that is customer responsive Proven track record through num
Slide 33: Growth in Shareholder Equity
Growth in Shareholder Equity The Warren Buffet Standard 33 0 500 1,000 1,500 2,000 2,500 3,000 Thousands 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 PTEN Investment Highlights Growth in Shareholder Equity The Warren Buffet Standard 1,000 1,500 2,000 2,500 3,000 Thousands 1999 20
Slide 34: Conclusions
34 Favorable trends are likely to persist in North American oil and natural gas markets US Land Drilling and Pressure Pumping are major beneficiaries of the new trends Patterson-UTI has the right assets: Drilling rigs well-matched to the customers’ needs Well stimulation assets that meet customers’
Slide 35: Credit Suisse Energy Summit
Credit Suisse Energy Summit Patterson-UTI Energy, Inc. Patterson-UTI Energy, Inc. Credit Suisse Energy Summit February 8-9, 2012 February 8-9, 2012
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