Cenovus 2011 UBS Global Oil and Gas Conference

- $1.8 B committed capital
- $0.1 B one-time costs
- Ability to utilize balance sheet to fund additional opportunities
- $700 MM of additional opportunity capital includes:
    - 440 strat wells drilled in Q1
    - scalable conventional oil & natural gas programs
- expand drilling program at Pelican Lake
- future oil sands expansions
- $600 MM of 2011F capital contributes to 2011F production
- $300 – 500 MM of potential divestiture proceeds not included in budget

http://docsearch.derrickpetroleum.com/files/12837/Cenovus%202011%20UBS%20Global%20Oil%20and%20Gas%20Conference.pdf

Goodrich Petroleum Corporation shifting towards Oil and Liquids development from Natural Gas; Allocated 70% of its 2011 Capital Program to Oil Exposure (62% Eagle Ford Shale Trend)!!

Goodrich Petroleum increased 2011 capital program to develop the company's new acreage in the Eagle Ford Shale, as the company joins the shift towards oil and liquids development. Goodrich Petroleum increased its total 2011 capital budget by $10 million, from $225 million to $235 million.  The company increased the allocation to the Eagle Ford Shale formation by $45 million, from $100 million to $145 million.

Eagle Ford Shale

Goodrich Petroleum has been focusing its attention and capital over the last few years for developing the company's natural gas assets, including the Haynesville Shale and Cotton Valley formations in East Texas and North Louisiana.

In April 2010, faced with low prices and weak fundamentals for natural gas, the company decided to diversify away from this commodity, and purchased 35,000 net acres in the Eagle Ford Shale in Texas. The acreage is located in La Salle and Frio County, which is considered the oil window of the play. During the fourth quarter of 2010, the company drilled 4 gross or 3 net wells into the Eagle Ford Shale. Goodrich Petroleum is operating two rigs on its Eagle Ford Shale acreage and expects to drill from 22 to 26 wells on its 40,000 net acres.

Recent M&A Deals in Eagle Ford Shale:

Source: Derrick Petroleum E&P Transactions Database

Haynesville Shale

Although Goodrich has been focusing in the Haynesville Shale, the company is deemphasizing development here in 2011 in favor of more oil focused properties in its portfolio. In 2010, the company spent approximately 56% of its total drilling budget, or $156 million, to drill 18 net wells into the Haynesville Shale. In 2011, the company plans to spend only $90 million to drill nine net wells on its Haynesville Shale properties. One area of focus for Goodrich Petroleum in 2011 will be in the Shelby Trough area of East Texas, where the company has 28,000 net acres under lease. The company drilled its first Haynesville Shale well here, and also plans development of the Bossier Shale in 2011. This formation lies just above the Haynesville Shale and produces natural gas.

Recent M&A Deals in Haynesville Shale:

Source: Derrick Petroleum E&P Transactions Database

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Abraxas Petroleum Built Around Solid Conventional Assets; Expanded Capital Program of $60 million for 2011; Most of its capex is going to producing more oil!!

Abraxas reported 2010 year-end reserves totaled 26.6 mmboe up 7% over 2009 despite selling 9% of proved reserves in our divesture program. The company operates wells in the Bakken, West Texas, South Texas, and Canada. Abraxas has outside operated wells in the Bakken. Most of its capex is going to producing more oil. Its goal this year 2011 is to try to get to a 50% oil/gas mix. In the Eagle Ford, it would like to accelerate its partnership with the JV. Last year it had asset sales of $34 million (non-core and non-operated). The money is used for this year's capex and to pay down debt. It would like to eventually get 90% of its assets operating.

Source: Derrick Petroleum E&P Transactions Database

Currently, Abraxas has south and West Texas conventional assets, Eagle Ford and northern Rockies and Canada conventional resource plays, including the Bakken and the Niobrara.

Abraxas has 8,333 acres in Eagle Ford. This location, part of a $25 million equity investment, is 43% oil, 35% gas/condensate, and 22% gas window. The company also has approximately 14,000 acres in the Niobrara shale, with 3,800 gross acres leased and 11 producing wells. Its holdings are in the same area with Chesapeake (CHK) and EOG Resources. In the Southern Alberta Bakken it has approximately 10,000 acres leased. Abraxas also has a small holding in the Pekisko Fairway in Canada.

Abraxas' Rocky Mountain assets has 7.2 MMBoe in proven reserves; 63% of this is proved developed, 82% is crude oil, with 1063 Boepd of production, 900 gross producing wells, and 90,362 gross acres. Primary locations here are the Willston Basin, Powder River Basin, Green River Basin, and Unita Basin.

The Permian Basin has 5.6 MMBoe of proved reserves; 66% proved developed; 70% is natural gas. There is also 1254 Boepd of production; 237 gross producing wells; 36,064 acres, The primary producing sub-basins are the Delaware Basin and Eastern Shelf.

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The Gulf Coast has 9 MMBoe of proved reserves; 38% is proved developed; 91% is natural gas; 1044 Boepd of production. This area has 74 gross producing wells, and Abraxas has 11,414 acres in the area. The primary sub-producing basin is the Onshore Gulf Coast.

This company looks to be another oil and gas exploration and production company with great assets that, in time, could turn into something great if everything works out. It is well positioned, especially if oil gets up to around a $100 a barrel and stays there for a while.

Petrohawk Energy reported 34% increase in 2010 hydrocarbon production over 2009; Announced $2,300 million Capital Program for 2011; Plan to double its liquid production in 2011

Petrohawk produced an average of 562 Mmcfepd during 2010. The midpoint of full year 2011 production guidance is 885 Mmcfepd, representing an estimated 31% year over year increase and a 57% year over year increase pro forma for 2010 divestitures. The midpoint of first quarter 2011 production guidance is 770 Mmcfepd.

Petrohawk announced $2,300 million capital program, of which $1,900 million (82%) is allotted to drilling and completion activities.

Eagle Ford Shale:

- Planned 12 rigs for 1H 2011 and 15 rigs for 2H 2011. ~347,600 risked net commercially productive acres

Black Hawk:

- Estimate of ~73,600 risked commercially productive net acres. Currently operating eight rigs ramping to 10 rigs by June 2011

Hawkville Field:

- Currently operating 5 rigs with plan to hold constant in 2011. Risked estimate of ~224,000 commercially productive net acres

Red Hawk:

- Five wells scheduled for 2011, two waiting on completion. 

Haynesville Shale:

- Estimated ~225,000 risked commercially productive net acres; 75% operated. Operated rig count currently 16 and will hold thru 1st half 2011, 7 in 2ndhalf of 2011; leasehold requirements primarily met by mid-year

Lower Bossier Shale:

- Estimate ~150,000 risked commercially productive net acres. The company anticipates initiating Bossier development once Haynesville lease capture complete in mid-2012

GMX RESOURCES INC. Announces Record First Quarter 2011 Production and Guidance for Second Quarter 2011; Plan to increase liquidity through asset sales and Joint Ventures

GMX RESOURCES INC., has reported hydrocarbon production of 6.0 Bcfe for the first quarter 2011, up 14% over the fourth quarter of 2010 and up 89% increase over the first quarter of 2010. The Company’s second quarter and full year 2011 guidance is 6.1 Bcfe with an expected range of 25.0-26.0 Bcfe, respectively, which represents an increase of 42% and 43%-49% in the second quarter and full year 2010.

GMX plan to deploy capital in high value opportunities. The company initiated Bakken and Niobrara acreage development plans by allocating capital across three basins to diversify commodity price and basin risk.

The company announced $168 million capital program, of which 24% is allocated for oil developments and projected 54% of its 2012 capital program for oil developments.

Recent JVs Increase Value of GMXR Acreage

The company announced JV between Marathon Oil & Marubeni Corp. values nearby acreage at ≈ $5,000/acre

JV between CHK and CNOOC values nearby acreage at over $4,750/acre

Source:Derrick Petroleum E&P Transactions Database

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ConocoPhillips increases 2011 capital budget by $2.5 billion to $16 billion!! ConocoPhillips to venture in to GoM, shale areas and Angola.

ConocoPhillips intends to target shale gas and deepwater acquisitions as part of the company's current asset management program. The company will increase planned capital spending of $13.5 billion by $2.5 billion for 2011 for favourable opportunities, the Gulf of Mexico in particular. Conoco is also looking at deep-water prospects off the coast of Angola. Shale assets are being sought in the US, Canada, eastern Europe (Poland) and China. ConocoPhillips’ chief executive Jim Mulva said, “The Company has its sights set on shale plays outside the key Marcellus and Eagle Ford regions”.

Source: Conocophillips - Howard Weil Conference- Mar 2011

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Why is ConocoPhillips on shopping spree?? May be these reasons-

• Steady increase in oil price which is reaching approximately $120/barrel, the highest since July 2008 when it had hit $147/barrel
• Unconventional fever is spreading across US, Canada, Europe and China. Recently, the Asians- in particular Chinese are striking back to back deals in US/Canada shale areas. Then, why not the US supermajor?? To make use of the robust oil price season, is ConocoPhillips looking at Bakken and Niobrara plays, if they are looking at the plays outside Marcellus and Eagle Ford.
• Angola- Possesses similar characteristics to the pre-salt play located offshore Brazil. Many companies are active in exploring this pre-salt play in Angolan waters including Cobalt International, which is the operator of three blocks. Other operators that were awarded blocks by the Angolan government include Statoil, Total and BP. So, even ConocoPhillips may like to step into Angola.

Below are the significant deals in Angola:

• Post Macondo oil spill, the companies like Shell, Noble Energy and BHP Billiton have been issued drilling permits in the GoM. This shows that the situation is slowly recovering in GoM. This may be one of the reasons why Conoco is interested towards GoM.

Following are the GoM packages which may be attractive to ConocoPhillips:

Source: Derrick Petroleum E&P Transactions Database

ConocoPhillips, currently being focused onshore US and Canada, wants to establish the company as a diversified player stepping into new areas like GoM, Angola, China, Poland, etc.,