Eagle Ford Shale Study November 11, 2010 Eagle Ford Shale Study – Area Overview Overview Map Eagle Ford Shale Study – Area Overview Total Historical Production Stacked by Area 400,000 400 Area 1 (South Texas) Daily Equivalent (Mcfe/day) 350,000 Area 2 (Gulf Coast Texas) Daily Equivalent (Mcfe/day) 350 Area 3 (Greater East Texas) Daily Equivalent (Mcfe/day) 300 250,000 250 200,000 200 150,000 150 100,000 100 50,000 50 0 0 Total Wellcount 300,000 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Daily Equivalent (Mcfe/day) Total Wellcount Eagle Ford Shale Study – Area Overview Horizontal Well Production Stacked by Area 400,000 400 Area 1 (South Texas) Daily Equivalent (Mcfe/day) 350,000 350 Area 2 (Gulf Coast Texas) Daily Equivalent (Mcfe/day) Area 3 (Greater East Texas) Daily Equivalent (Mcfe/day) Total Wellcount 250 200,000 200 150,000 150 100,000 100 50,000 50 Jul 2010 May 2010 Mar 2010 Jan 2010 Nov 2009 Sep 2009 Jul 2009 May 2009 Mar 2009 Jan 2009 Nov 2008 Sep 2008 Jul 2008 May 2008 Mar 2008 Jan 2008 Nov 2007 Sep 2007 Jul 2007 May 2007 0 Mar 2007 0 Total Wellcount 300 250,000 Jan 2007 Daily Equivalent (Mcfe/day) 300,000 Eagle Ford Shale Study – Area Overview Area 1 (South Texas) Operator Ranking Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Operator ANADARKO PETROLEUM CORPORATION ROSETTA RESOURCES INC. SM ENERGY COMPANY PETROHAWK ENERGY CORPORATION XTO ENERGY, INC. CHESAPEAKE ENERGY CORPORATION EL PASO CORPORATION TALISMAN ENERGY USA INC. EOG RESOURCES INCORPORATED LEWIS PETRO PROPERTIES, INC. SWIFT ENERGY COMPANY ESCONDIDO RESOURCES II, LLC MURPHY OIL CORPORATION SAN ISIDRO DEVELOPMENT CO, L. C. REDEMPTION OIL & GAS, LLC CABOT OIL & GAS CORPORATION NEWFIELD EXPLORATION COMPANY MANTI EXPLORATION OPERATING LLC ESPADA OPERATING LLC EDDY A. STACHA Active Well Count 41 15 28 29 4 8 5 5 5 6 2 1 5 1 1 1 3 1 1 1 *Notes: Above based on gross, operated data Daily Oil (bbl/day) 5,619 2,953 1,474 1,216 502 1,514 990 126 798 6 308 0 0 249 165 87 28 31 6 1 Daily Gas (Mcf/day) Daily Equivalent (Mcfe/day) % of Total Cum % Average Rate per Well (Mcfe/day) 28,510 43,620 39,291 39,700 12,502 5,087 3,606 8,124 1,742 6,463 2,981 4,483 3,318 783 0 40 268 0 0 0 62,222 61,335 48,135 46,993 15,516 14,169 9,545 8,878 6,530 6,501 4,830 4,483 3,318 2,275 989 562 435 185 37 4 21% 21% 16% 16% 5% 5% 3% 3% 2% 2% 2% 2% 1% 1% 0% 0% 0% 0% 0% 0% 21% 42% 58% 74% 79% 84% 87% 90% 92% 94% 96% 97% 98% 99% 100% 100% 100% 100% 100% 100% 1,518 4,089 1,719 1,620 3,879 1,771 1,909 1,776 1,306 1,083 2,415 4,483 664 2,275 989 562 145 185 37 4 Eagle Ford Shale Study – Area Overview Area 2 (Gulf Coast Texas) Operator Ranking Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 Operator PIONEER NATURAL RESOURCES COMPANY GEOSOUTHERN ENERGY CORPORATION EOG RESOURCES INCORPORATED CONOCOPHILLIPS COMPANY ENDURING RESOURCES, LLC DAN A. HUGHES COMPANY, L.P. RILEY EXPLORATION, LLC APACHE CORPORATION MODERN EXPLORATION, INC. CLAYTON ENERGY WILLIAMS, INC. EXPLORATION TECHNIQUES, INC. TDC ENGINEERING, INC. XTO ENERGY, INC. Active Well Count Daily Oil (bbl/day) Daily Gas (Mcf/day) Daily Equivalent (Mcfe/day) % of Total Cum % Average Rate per Well (Mcfe/day) 9 5 13 1 2 3 2 26 1 2 1 1 1 1,055 1,671 2,384 689 298 678 676 207 168 155 5 2 1 14,749 7,706 2,395 3,417 4,264 939 722 204 0 0 0 0 0 21,079 17,729 16,701 7,549 6,051 5,005 4,778 1,443 1,007 931 28 11 7 26% 22% 20% 9% 7% 6% 6% 2% 1% 1% 0% 0% 0% 26% 47% 67% 77% 84% 90% 96% 98% 99% 100% 100% 100% 100% 2,342 3,546 1,285 7,549 3,025 1,668 2,389 56 1,007 465 28 11 7 *Notes: Above based on gross, operated data Eagle Ford Shale Study – Area Overview Area 1 (South Texas) Operators by Drill Type 70,000 60,000 Horizontal (Mcfe/day) Vertical (Mcfe/day) Daily Equivalent (Mcfe/day) 50,000 40,000 30,000 20,000 10,000 0 *Notes: Above based on gross, operated data Eagle Ford Shale Study – Area Overview Area 2 – Gulf Coast Texas Operators by Drill Type 45,000 40,000 Daily Equivalent (Mcfe/day) 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 *Notes: Above based on gross, operated data Vertical (Mcfe/day) Horizontal (Mcfe/day) Eagle Ford Shale Study – Area Overview Area 1 – South Texas Type Curve Comparison by Drill Type 10,000 Horizontal Wells - Drilled Since 2006 (Mcfe/day) Vertical Wells (Mcfe/day) 100 10 Year 9 Year 8 Year 7 Year 6 Year 5 Year 4 Year 3 Year 2 Year 1 1 Year 0 Daily Equivalent (Mcfe/day) 1,000 Eagle Ford Shale Study – Area Overview Area 2 – Gulf Coast Texas Type Curve Comparison by Drill Type 10,000 Horizontal Wells - Drilled Since 2006 (Mcfe/day) Vertical Wells (Mcfe/day) 100 10 Year 9 Year 8 Year 7 Year 6 Year 5 Year 4 Year 3 Year 2 Year 1 1 Year 0 Daily Equivalent (Mcfe/day) 1,000 Month 23 Month 22 Month 21 Month 20 Month 19 Month 18 Month 17 Month 16 Month 15 Month 14 Month 13 Month 12 Month 11 Month 10 Month 9 Month 8 Month 7 Month 6 Month 5 Month 4 Month 3 Month 2 Month 1 Month 0 Daily Rate and Wellcount Area 1 – South Texas Type Curve for Horizontal Wells Drilled Since 2006 Eagle Ford Shale Study – Area Overview 10,000 Daily Oil (bbl/day) Daily Gas (Mcf/day) Number of Wells Influencing the Curve 1,000 100 10 1 Eagle Ford Shale Study – Area Overview Area 2 – Gulf Coast Texas Type Curve for Horizontal Wells Drilled Since 2006 10,000 Daily Oil (bbl/day) Daily Gas (Mcf/day) Number of Wells Influencing the Curve 100 10 Month 23 Month 22 Month 21 Month 20 Month 19 Month 18 Month 17 Month 16 Month 15 Month 14 Month 13 Month 12 Month 11 Month 10 Month 9 Month 8 Month 7 Month 6 Month 5 Month 4 Month 3 Month 2 Month 1 1 Month 0 Daily Rate and Wellcount 1,000 Eagle Ford Shale Study – Area Overview Area 1 – South Texas Horizontal Production Stacked by Vintage 300,000 300 2010 - Daily Equivalent (Mcfe/day) 2009 - Daily Equivalent (Mcfe/day) 2008 - Daily Equivalent (Mcfe/day) 2007 - Daily Equivalent (Mcfe/day) 2000-2006 - Daily Equivalent (Mcfe/day) Total Wellcount 200 150,000 150 100,000 100 50,000 50 Jul 2010 May 2010 Mar 2010 Jan 2010 Nov 2009 Sep 2009 Jul 2009 May 2009 Mar 2009 Jan 2009 Nov 2008 Sep 2008 Jul 2008 May 2008 Mar 2008 Jan 2008 Nov 2007 Sep 2007 Jul 2007 May 2007 0 Mar 2007 0 Wellcount 250 200,000 Jan 2007 Daily Equivalent (Mcfe/day) 250,000 Eagle Ford Shale Study – Area Overview Area 2 – Gulf Coast Texas Horizontal Production Stacked by Vintage 300,000 300 2010 - Daily Equivalent (Mcfe/day) 2009 - Daily Equivalent (Mcfe/day) 2008 - Daily Equivalent (Mcfe/day) 2007 - Daily Equivalent (Mcfe/day) 2000-2006 - Daily Equivalent (Mcfe/day) Total Wellcount 200 150,000 150 100,000 100 50,000 50 Jul 2010 May 2010 Mar 2010 Jan 2010 Nov 2009 Sep 2009 Jul 2009 May 2009 Mar 2009 Jan 2009 Nov 2008 Sep 2008 Jul 2008 May 2008 Mar 2008 Jan 2008 Nov 2007 Sep 2007 Jul 2007 May 2007 0 Mar 2007 0 Wellcount 250 200,000 Jan 2007 Daily Equivalent (Mcfe/day) 250,000 Eagle Ford Shale Study – A Closer Look at South Texas Production Stacked by Operator 300,000 300 EL PASO CORPORATION CHESAPEAKE ENERGY CORPORATION 250,000 250 XTO ENERGY, INC. PETROHAWK ENERGY CORPORATION SM ENERGY COMPANY ROSETTA RESOURCES INC. 200 ANADARKO PETROLEUM CORPORATION All Other Operators - Daily Equivalent (Mcfe/day) Total Wellcount 150,000 150 100,000 100 50,000 50 *Notes: Above based on gross, operated data Jul 2010 Aug 2010 Jun 2010 Apr 2010 May 2010 Mar 2010 Jan 2010 Feb 2010 Dec 2009 Oct 2009 Nov 2009 Sep 2009 Jul 2009 Aug 2009 Jun 2009 May 2009 Apr 2009 Feb 2009 Mar 2009 Jan 2009 Dec 2008 Oct 2008 Nov 2008 Sep 2008 Jul 2008 Aug 2008 Jun 2008 Apr 2008 May 2008 Mar 2008 Jan 2008 0 Feb 2008 0 Total Wellcount Daily Equivalent (Mcfe/day) 200,000 Eagle Ford Shale Study – A Closer Look at South Texas Type Curve Comparison by Operator 10,000 Daily Equivalent (Mcfe/day) 1,000 100 ANADARKO PETROLEUM CORPORATION ROSETTA RESOURCES INC. SM ENERGY COMPANY PETROHAWK ENERGY CORPORATION XTO ENERGY, INC. 10 CHESAPEAKE ENERGY CORPORATION EL PASO CORPORATION INDUSTRY AVERAGE *Notes: Above based on gross, operated data Month 24 Month 23 Month 22 Month 21 Month 20 Month 19 Month 18 Month 17 Month 16 Month 15 Month 14 Month 13 Month 12 Month 11 Month 10 Month 9 Month 8 Month 7 Month 6 Month 5 Month 4 Month 3 Month 2 Month 1 1 Eagle Ford Shale Study – A Closer Look at South Texas Cumulative Production by Operator by Drill Type 25,000 Vertical Equivalent Cum (MMcfe) Cumulative Equivalent Production (MMcfe) 20,000 15,000 10,000 5,000 0 *Notes: Above based on gross, operated data Horizontal Equivalent Cum (MMcfe) Eagle Ford Shale Study – A Closer Look at South Texas Cumulative Production by Operator by Product 25,000 Cumulative Equivalent Production (MMcfe) 20,000 15,000 10,000 5,000 0 *Notes: Above based on gross, operated data Cumulative Oil (In Terms of Gas - MMcfe) Cumulative Gas (MMcf) Eagle Ford Shale Study – A Closer Look at South Texas IP Analysis 12,000 10,000 Equivalent IP (Mcfe/day) 8,000 6,000 4,000 2,000 0 Eagle Ford Shale Study – A Closer Look at South Texas IP Analysis - IP vs. Horizontal Length (feet) by Vintage 12,000 2000-2007 2008 10,000 2009 2010 (Equivalent IP (Mcfe/day) 8,000 6,000 4,000 2,000 0 0 1,000 2,000 3,000 4,000 5,000 Horizontal Length (feet) 6,000 7,000 8,000 9,000 Eagle Ford Shale Study – A Closer Look at South Texas IP Analysis by Product 12,000 10,000 Oil Wells (40% or more oil by Equivalent Cum) Gas Wells (60% or more gas by Equivalent Cum) (Equivalent IP (Mcfe/day) 8,000 6,000 4,000 2,000 0 Eagle Ford Shale Study – A Closer Look at South Texas IP Analysis by Operator 12,000 ANADARKO PETROLEUM CORPORATION CABOT OIL & GAS CORPORATION CHESAPEAKE ENERGY CORPORATION CORNERSTONE E & P COMPANY, LP 10,000 EL PASO CORPORATION EOG RESOURCES INCORPORATED ESCONDIDO RESOURCES II, LLC ESPADA OPERATING LLC (Equivalent IP (Mcfe/day) 8,000 LEWIS PETRO PROPERTIES, INC. MURPHY OIL CORPORATION NEWFIELD EXPLORATION COMPANY PETROHAWK ENERGY CORPORATION 6,000 REDEMPTION OIL & GAS, LLC ROSETTA RESOURCES INC. SAN ISIDRO DEVELOPMENT CO, L. C. 4,000 SM ENERGY COMPANY SWIFT ENERGY COMPANY TALISMAN ENERGY USA INC. XTO ENERGY, INC. 2,000 0 0 1,000 2,000 3,000 4,000 5,000 Horizontal Length (feet) *Notes: Above based on gross, operated data 6,000 7,000 8,000 9,000 4,500 4,000 Jan 2007 Feb 2007 Mar 2007 Apr 2007 May 2007 Jun 2007 Jul 2007 Aug 2007 Sep 2007 Oct 2007 Nov 2007 Dec 2007 Jan 2008 Feb 2008 Mar 2008 Apr 2008 May 2008 Jun 2008 Jul 2008 Aug 2008 Sep 2008 Oct 2008 Nov 2008 Dec 2008 Jan 2009 Feb 2009 Mar 2009 Apr 2009 May 2009 Jun 2009 Jul 2009 Aug 2009 Sep 2009 Oct 2009 Nov 2009 Dec 2009 Jan 2010 Feb 2010 Mar 2010 Apr 2010 May 2010 Jun 2010 Jul 2010 Aug 2010 Sep 2010 Oct 2010 Nov 2010 Gross Acreage (Thousands of Acres) Eagle Ford Shale Study – A Closer Look at South Texas Gross Acreage Leased by Year 5,000 2010 2009 2008 2007 3,500 3,000 2,500 2,000 1,500 1,000 500 0 Eagle Ford Shale Study – A Closer Look at South Texas Permits Issued by Drill Type Since 2000 600 500 Vertical Horizontal No. of Permits Issued 400 300 200 100 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 CASKIDS OPERATING CO. MCDAY ENERGY CORP. LMP PETROLEUM HUNT OIL CO. COMMON RESOURCES L.L.C. 70 TIDAL PETROLEUM EXXON MOBIL CORP. ESPADA OPERATING LLC COMSTOCK OIL & GAS, LP CHEYENNE PETROLEUM CO. CABOT OIL & GAS CORP. AURORA RESOURCES CORP. TALISMAN ENERGY USA INC. MATADOR PRODUCTION CO. GOODRICH PETROLEUM CO. ENDURING RESOURCES, LLC SHELL WESTERN E&P RILEY EXPLORATION, LLC LAREDO ENERGY SAN ISIDRO DEVELOPMENT CO. MURPHY EXPL. & PROD. CO. XTO ENERGY INC. TEXAS AMERICAN RESOURCES NEWFIELD EXPLORATION CO. CARRIZO OIL & GAS ESCONDIDO RESOURCES II EOG RESOURCES EL PASO E & P CO., L. P. SM ENERGY CO. SWIFT ENERGY OPERATING ROSETTA RESOURCES PETROHAWK OPERATING CO. LEWIS PETRO PROPERTIES ANADARKO E&P CO. LP CHESAPEAKE OPERATING No. of Permits Issued Eagle Ford Shale Study – A Closer Look at South Texas Active Permits by Operator by Drill Type Since 2008 80 Vertical Horizontal 60 50 40 30 20 10 0 Eagle Ford Shale Study Data sources: HPDI.Com DrillingInfo.Com Notes: 1. Production data as of August 31, 2010 2. Leasing data as of September 30, 2010 (Recording Date) 3. Permit data as of October 22, 2010 4. Production and permit data are specific to the Eagle Ford shale reservoir, while leasing data includes all reservoirs within the specified areas 5. Horizontal length estimated by distance between surface and permitted bottom hole lat/longs 6. IP’s calculated using maximum month of reported production, and converted to daily rate