Pioneer Natural Resources (PXD) at Howard Weil

Pioneer Natural Resources

About two years ago changed focus to onshore and things have worked out great since then.

14% production growth per share is projected.

Will generate significant free cash flow over next several years driven by production growth and roll off of legacy hedges.

Plays include downspacing in Sprayberry and Pierre shale.

Will be relatively unhedged in 2009-2012 period as legacy hedges roll off – if there is a superspike in gas prices, then might consider hedging again.

Pierre Shale – a shale play in Raton basin – drilled 2 wells 18 months ago and they have been working on it since - 15 wells in 2008, 30-40 next year. Zero percent entry cost in this play since they are already in area in different zones. Very economical wells similar to Raton Basin Coal bed methane play.

Raton Basin CBM – 160 wells in 2008.

Alaska – 2 projects underway – one will have first production this summer. Peak production in 2013 from the projects here.

Tunisia – have to get capacity installed to handle operations on their blocks – good leads and prospects here. Will be expanding the fairway.

Edwards Trend – 35 wells in 2008 – running six rigs here – 200 identified locations.

Barnett Shale – partnering with Devon – 20 wells planned in 2008.

Sprayberry – 5th largest oil field in the United States – company has 5300 wells and almost one million acres - drilled four successful wells on 20 acre downspacing in 2007 – will do 20-25 more in 2008 - 12-13% recovery on 40 acre spacing – 25-28% recovery ultimately is expected. One billion barrels is ultimate resource potential here. Will add 250 million barrels over the next few years. This will help with booking PUD’s and lower finding and development costs.