Download - Layne Energy Exec summary
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Layne Energy Project Overview
Phil Winner
Project Overview
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• Agenda – Operations/Overview
• Production • Cost Structure • Business Intelligence “Dashboards”
– Geoscience/Upside Inventory • PDP Reserve “Write-Up” • Resource Mapping • Burgess Sand Reserve additions • Cattleman Sand Discovery and Waterflood • Weiser Shallow Oil Sand Redevelopment • Miss Lime Exploration and Discovery
Operations/Overview
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• Wells – Gas/Oil: 620/31 – Spacing: 160 acres – Disposal: 33 – Potential 160’s: 244
• Reserves (1/31/12) – Gas (Bcf): 22.1 – Oil (Mbo): 66.4 – PV10 ($MM): $31.3
• Net Daily Production – Gas (MMcf): 12.0 – Oil (Bbls): 50.0
• Pipeline – Miles: 750 – Compression HP: 8,000
• Acres – Total: 223,454 – Kansas: 184,191 – Indiana: 39,263
• Headcount – Total: 32 – Denver 6 – Independence 26
6 Miles
Cherryvale
Sycamore
Operations/Overview
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$1,310
$967
$761
$609 $497
$-
$200
$400
$600
$800
$1,000
$1,200
$1,400
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
$/w
ell/
mon
th
Lease Operating Expense
50.1
16.6 16.5 18.5 22.1
0.59 0.40
0
10
20
30
40
50
60
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
Reserve Volumes
Gas (Bcf)
Oil (Bcfe @ 6:1)
Bcfe
$86.5
$40.2 $22.4 $28.1 $28.9
$3.3 $2.4
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
$8.00
$0$10$20$30$40$50$60$70$80$90
$100
FY 2008 FY 2009 FY 2010 FY 2011 FY 2012
Reserve Value (PV10)
GasOil
$MM Gas Price ($/Mcf)
P & L
Production (Bcfe) 4.6 $/Mcfe
Revenue $ 20,388 $ 4.40
EBITDA $ 7,630 $ 1.65
IBT $ 501 $ 0.11
Reduction due to cost controls on compression and chemical
treatments
• LOE reduction • Upward adjustment on PDP • Conventional targets
0
5
10
15
20
25
0
5,000
10,000
15,000
20,000
Jan-08 Jan-09 Jan-10 Jan-11 Jan-12
Pres
sure
(psi
g)
Rate
(mcf
/d)
Time
Kansas Production by Year Connected
Oil as MCFEColt Gas2011 - 12 Wells2010 - 14 Wells2009 - 18 Wells2008 - 116 Wells2007 - 104 Wells2006 - 154 Wells2005 - 72 Wells2004 - 54 Wells2003 and beforeAverage Line Pressure (psig)
Operations/Overview
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Increase Line Pressure to
Curtail Production During Low Gas Prices
Multi-stage fracs
Single-stage fracs
Multi-stage fracs
Operations/Overview
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$(1,000)
$(500)
$-
$500
$1,000
$1,500
$0.00 $1.00 $2.00 $3.00 $4.00 $5.00
EBITDA
IBT
EBIDA and IBT Gas Price Sensitivity (last 14 months)
EBIT
DA, I
BT
$M
Gas Price ($/Mcf)
Break-even cash flow $2.20/Mcf
Detailed knowledge of cost structure leads to good understanding of profitability
Break-even IBT $3.75/Mcf
Operations/Overview
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• All of Layne’s wells and compressor stations are self reporting on radio-based SCADA system, greatly enhancing operational efficiency
• Data captured on central server • Allows management by exceptions
SCADA remote data collection system
Operations/Overview
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By well
By month
By year
By Pumper
• Layne’s accounting system (Bolo) is interfaced with Tableau to identify areas for improvement or enhancement
Developed custom business intelligence dashboards: • Reduced costs • Streamline decision making
Operations/Overview
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Sort for most profitable wells
Developed custom business intelligence dashboards: • Reduced costs • Streamline decision making
Geoscience/Upside Inventory
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• PDP – Performance shows CGA decline is too steep.
• Probable – CBM: 244 locations on 160 acre spacing (40-60 “A” quality locations). – Miss “Chat” – Mississippian Lime
• Possible – Weiser oil sand, Burgess
Geoscience/Upside Inventory: PDP
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Well Count
Field performance has consistently outperformed
reserve forecasts
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Resource Mapping: Gas in Place
Geoscience/Upside Inventory
Geoscience/Upside Inventory: Burgess Sand Before
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Top of Burgess sand 750 Mcfd 125 Mcfd Top of Burgess
sand
1 Mile
Previously, Burgess Sand wells were completed “topset” so extent of reservoir and reserve potential was unknow
? ?
Geoscience/Upside Inventory Burgess Sand: After
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Top of Burgess sand 750 Mcfd 125 Mcfd
Top Mississippian
72’ of neutron/density x-over in Burgess
26’ of neutron/density x-over in Mississippian
Complete penetration and core in Burgess sand revealed significant reservoir potential and supported significant reserve additions
Geoscience/Upside Inventory: Waterflood
15 0
50
100
150
200
250
300
40 50 60 70 80 90 100
Btax
IRR
Oil Price ($/bbl)
Oil Well Price Sensitivity, Primary Recovery Only
SINGLE WELL ECONOMICS • NPV10 ($M): $87.7 • ROI (disc./undisc.): 1.2/1.6 • CapEx: ($M): $72.0 • Net Reserves (Mbo): 3.4 • F&D ($/Bbl): $22.00 Wells
• Producers: 18 • Injectors: 9
020406080
100120140160180200220240
Daily Oil Volume
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0
20
40
60
80
100
Primary EUR = 100 Mbo
Secondary + Primary EUR = 270 Mbo (27% Recovery Factor)
170 Mbo incremental
La Fontaine Unit Cattleman Waterflood Av
erag
e an
nual
Bop
d
Forecast Actual
Waterflood Economics • Oil in Place (Mbo): 1.0 • CapEx (M$): $533.7 • Btax IRR: 577% • Disc. ROI: 10.1 • F&D cost($/Bbl): $3.15/Bbl
Geoscience/Upside Inventory: Waterflood
Geoscience/Upside Inventory: Weiser shallow oil sand
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Areas with reported Weiser Production
(stats below are fieldwide, from KGS) Elk City Northeast • Cum 2.2 Mbo / 17.6 MMcf • 15 wells (146 Bo/well) • Lansing / Marmaton
Elk City Field • 178 Mbo / 2,660 MMcf • 79 wells (2,253 Bo/well) • Marmaton / Bartlesville
Sorghum Hollow Field • 1,050 Mbo / 101 MMcf • 144 wells (7,292 Bo/well) • Marmaton / Arbuckle
Wayside-Havana Field • 8,471 Mbo / 5,484 MMcf • 1,311 wells (6,461 Bo/well) • Lansing / Marmaton / Bartlesville /
CBM / Mississippian / Arbuckle
Frasier North & Frasier Fields • 381 Mbo / 3,378 MMcf • 191 wells (1,995 Bo/well) • Lansing / Peru / Marmaton / CBM /
Mississippian
Jefferson-Sycamore Field • 10,034 Mbo / 25,753 MMcf • 1,185 wells (8,468/well) • Marmaton / Bartlesville / CBM /
Arbuckle
Geoscience/Upside Inventory: Weiser shallow oil sand
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Oliver 14G 20 Weiser development and water flood
reactivation
24’ of sand with 25-28% porosity. Average SW for this interval is 46%.
Geoscience/Upside Inventory: Miss Lime
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Approximate relative position of Layne leasehold
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Geoscience/Upside Inventory: Miss Lime
Upside Inventory: Mississippian Lime
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Geoscience: Miss Lime Regional Work to Thin Sections
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Geoscience/Upside Inventory: Miss Lime
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Geoscience/Upside Inventory: Miss Lime
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Geoscience/Upside Inventory: Miss Lime
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Geoscience/Upside Inventory: Miss Lime
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170’ of Oil Shows (fluorescence and free oil)
Geoscience/Upside Inventory: Miss Lime
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Miss “Chat” Fluorescence and 10’ oil
saturated core
Miss Lime Fluorescence and 40’ oil
saturated core
Mudlog Microlog
Miss Lime 30’ of Microlog perm in
zone of core and mudlog shows
Miss”Chat” 5’ of Microlog perm in
zone of core and mudlog shows
Miss Lime • Completed in perm zones • IP 45 Bopd, 80% WOR • $250,000 CWC
Geoscience/Upside Inventory: Miss Lime
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White Light UV Light
Geoscience/Upside Inventory: Miss Lime
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White Light UV Light
2393.15’
2393.15’
2393.70’
2393.70’
Geoscience/Upside Inventory: Miss Lime
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Woodford shale • Strong odor, • Strong hotwire show • Excellent RockEval data
Mudlog Microlog
Geoscience/Upside Inventory: Miss Lime
2,550
2,555
2,560
2,565
2,570
2,575
2,580
2,585
2,590
2,595
2,6000 5 10 15 20
Good - Excellent Po Fair 2,550
2,555
2,560
2,565
2,570
2,575
2,580
2,585
2,590
2,595
2,6000 200 400 600 800 1000
Oil (Type II) Gas Mix Oil (Type 0 20 40 60 80 100
2,550
2,555
2,560
2,565
2,570
2,575
2,580
2,585
2,590
2,595
2,6000 2 4 6 8 10 12Total Organic Carbon (wt% HC)
TOC% Carbonate
Upside: Woodford Shale Rock Eval Data
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Hydrogen Index (S2/TOC) Oil Potential S2 (mg HC/g) Total Organic Carbon (wt% HC)
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End