The 5-Minute Guide to Pioneer Natural Resources’ Stock

SOURCE: PIONEER NATURAL RESOURCES, SANDS WEEMS.

Pioneer Natural Resources 101Pioneer Natural Resources is a Texas-based independent

exploration and production company. At its core, the company is focused on drilling oil-rich horizontal wells in the state of

Texas, with dual focuses on the Permian Basin and the Eagle Ford shale.

SOURCE: PIONEER NATURAL RESOURCES, SANDS WEEMS.

Pioneer Natural Resources 101

Source: Pioneer Natural Resources Investor Presentation.

Pioneer Natural Resources 101Pioneer Natural Resources holds a premier position in Spraberry/Wolfcamp, which has world-class resource potential:

Source: Pioneer Natural Resources Investor Presentation.

Pioneer Natural Resources 101Pioneer Natural Resources differentiates itself from other E&P companies in three ways:1. It maintains an investment grade balance sheet, with very

little debt and ample cash• Pioneer will often issue equity instead of debt to fund

growth that’s in excess of cash flow2. It protects the bulk of its cash flow using oil and gas

hedges• For 2016, 85% of its oil production and 70% of natural

gas production is hedged3. It is vertically integrated

• Pioneer operates its own frac sand mine, oil-field services unit, and owns substantial midstream assets

Pioneer Natural Resources 101Pioneer Natural Resources has one of the cleanest balance sheets in the sector. Ample cash, minimal debt, and well staggered debt maturities:

Source: Pioneer Natural Resources Investor Presentation.

Pioneer Natural Resources 101Pioneer Natural Resources currently hedges 85% of its oil production, the bulk of which is hedged with three way collars:

Source: Pioneer Natural Resources Investor Presentation.

Pioneer Natural Resources 101Pioneer Natural Resources’ vertical integration includes investments in midstream assets like gas processing plants and water infrastructure:

Source: Pioneer Natural Resources Investor Presentation.

Pioneer Natural Resources 101Pioneer Natural Resources in a nutshell:• It’s the largest producer and acreage holder in the world-

class Spraberry/Wolfcamp section of the Permian Basin

• It’s cash rich and debt light, with enough cash to fund a growth-focused capital program in 2016

• Its vertical integration keeps its costs low, enabling the company to earn better margins, which is especially beneficial in the current low oil price environment

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