nbl noble energy overview august 2014 © 2014 noble energy. all rights reserved. 1
TRANSCRIPT
NBL© 2014 Noble Energy. All rights reserved. 1
Noble Energy OverviewAugust 2014
© 2014 Noble Energy. All rights reserved. 2
Noble EnergyExecution delivering a unique future
Outstanding growth agenda
▪ Production expected to double
▪ Cash flow to increase
▪ Returns to reach record levels
Diversified portfolio provides exceptionaloptionality
▪ Inventory of ultra-high return opportunities
▪ U.S. unconventional, global deepwater andexploration all play material roles
Proved reserves and discovered unbooked resources fueling growth
© 2014 Noble Energy. All rights reserved. 3
Noble Energy snapshot
Independent oil and gas producer
▪ Headquarters: Houston, TX
▪ Employees: 1,761
▪ Fortune 500 company
▪ NYSE stock symbol: NBL
Five core operating areas all with significant, visible growth
▪ DJ Basin, Marcellus Shale, Deepwater GOM
▪ Eastern Mediterranean, West Africa
United States
International55% 45%
Reserves
© 2014 Noble Energy. All rights reserved. 4
Key operating areasSustaining and transforming NBL
Onshore United States
▪ Large inventory of low-risk projects
▪ Liquids-rich Niobrara andMarcellus shale gas
Gulf of Mexico – Deepwater
▪ Galapagos start-up
▪ Extensive exploration portfolio
West Africa
▪ Offshore EG and Cameroon
▪ Aseng and Alen online
Eastern Mediterranean
▪ Offshore Israel and Cyprus
▪ Tamar in progress
Core operating areasNew ventures
© 2014 Noble Energy. All rights reserved. 5
DJ Basin
© 2014 Noble Energy. All rights reserved. 6
DJ Basin operationsPremier acreage position
Production up 20%
Strong well performance and lower well costs
Basin-wide downspacing (24 - 32 wells per section)
▪ Over 30% of 2014 well count
Accelerating extended reach lateral program
▪ 20% of 2014 well count
IDPs Maximizing Value While Reducing Impacts
Greater Wattenberg Area (GWA)
Wells Ranch
East Pony
NebraskaWyoming
Colorado
DJ Basin
Colorado
© 2014 Noble Energy. All rights reserved. 7
DJ Basin downspacingIncreasing the wells per section
Niobrara A Bench
Niobrara B Bench
Niobrara C Bench
Codell
16 WellsLess than 8%
1 Mile 1 Mile
24 Wells +More than 12%
Niobrara A Bench
Niobrara B Bench
Niobrara C Bench
Codell
300feet
300feet
© 2014 Noble Energy. All rights reserved. 8
DJ Basin oil infrastructureOver 80 percent of NBL oil exports the basin
Growing oil takeaway capacity
▪ Wattenberg Oil Trunkline online
▪ Tampa Rail system online
▪ White Cliffs expanding
▪ N. CO. gathering pipeline
▪ Pony Express N. CO lateral
White Cliffs
Pipeline
Plains Rail Terminal
Briggsdale Facilities
Wattenberg Oil Trunkline
Tampa Pipeline
Multiple Market Outlets
NorthernColorado
WellsRanch
Wells Ranch Facilities
PlattevilleFacilities
CushingOklahoma
© 2014 Noble Energy. All rights reserved. 9
Deepwater Gulf of Mexico
© 2014 Noble Energy. All rights reserved. 10
Deepwater Gulf of MexicoSustained value creation, significant visible growth
Proven track record of exploration success
▪ Leading-edge technologywith discipline processes
Production and cash flow increasing
▪ Oil-dominated production delivers strong margins
Existing infrastructure contributingto significant value creation
Four recent discoveries
Louisiana
Gunflint
Dantzler Big Bend
Producing
Sanctioned
Discovery
NBL Interests
Galapagos
© 2014 Noble Energy. All rights reserved. 11
Eastern Mediterranean
© 2014 Noble Energy. All rights reserved. 12
Market export opportunities: Israel/CyprusAvailable for export
Government export decision upheld by Israel supreme court
Approximately 40% of Israel discovered resources exportable
▪ Leviathan export quota
▪ Tamar is allowed to export
Export volumes include regional and LNG markets
Resource(Tcf)
Export %Export
volume (Tcf)
Tamar 20 20% 1.0
Dalit 2.5 45% 0.6
Leviathan 16 30% 8.0
Dolphin 0.1 50% 0.6
Tanin 1.2 40% 1.4
Karish 1.8 25% 0.7
Tamar SW 0.7 35% 1.2
Cyprus 5 80% 4
Total 34.6 21.2
© 2014 Noble Energy. All rights reserved. 13
Regional market opportunitiesCost-effective pipeline export options
Regional pipeline exports
▪ Jordan power and industrial needs
▪ Egypt existing LNG facilities
▪ Cyprus domestic market
Regional agreements signed
▪ Customers in Jordan and the Palestinian Authority
▪ Egypt / Union Fenosa LOI for Tamar and Tamar SW
Expecting pricing above domestic average Israel price
Egypt
Turkey
Syria
Lebanon
JordanIsrael
Cyprus
PA
Vasilikos
Potential pipeline
Existing LNG facilities
NBL© 2014 Noble Energy. All rights reserved. 14
Appendix
© 2014 Noble Energy. All rights reserved. 15
Appendix
Term Definition
Debt-adjusted per Share Calculations
Normalizes growth funded through debt by converting the change in debt into an equivalent amount of equity shares using an average stock price. The equivalent shares are netted with total shares outstanding which impacts the per share calculations of reserves, production and cash flow
Cash Flow at Risk (CFAR)The difference between NBL's base plan Cash Flow from Operations and NBL's Cash Flow from Operations at the 95% worst case scenario based on a simulation of commodity prices using a mean reversion model
Discretionary Cash Flow Cash Flow from Operations excluding working capital changes plus cash exploration expense
Funds from Operations (FFO) Cash Flow from Operations excluding working capital changes
Liquidity Cash and unused revolver capacity
Net Risked Resources Estimated gross resources multiplied by the probability of geologic success and NBL’s net revenue interest
Operating Cash Flow Revenue less lease operating expenses, production taxes, transportation, and income taxes
Organic Cash Capital Capital less capitalized interest, capital lease payments and acquisitions
Peers – Investment Grade – Non-Investment Grade
APA, APC, CLR, DVN, EOG, HES, MRO, MUR, PXD, SWNCHK, COG, RRC
Return on Average Capital Employed (ROACE)
Earnings before interest and tax (EBIT) plus asset impairments and unrealized mark to market derivatives divided by average total assets plus impairments less current liabilities
NBL© 2014 Noble Energy. All rights reserved. 16
Noble EnergyDelivering a unique future
UNIQUEBY DESIGN.
Unique Purpose
Unique Strategy
Unique Assets
Unique Execution
Unique Growth
Unique Results
Unique Future