Evercore Investment Banking Pitch Book
McMoRan Situation Analysis
Summary Financial Projections - Assumptions
■ The following financial projections summarize McMoRan's operating model (the "MMR Operating Model) as provided by
McMoRan management
■
The projections incorporate all activity associated with the Conventional Assets
■ In addition, the projections incorporate the development of MMR's Ultra-Deep Assets utilizing the following assumptions:
100% success rate on exploration wells (no dry hole costs)
Gross prospect size of 2 Tcfe
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Confidential
To develop a 2 Tcfe discovery requires 3 development wells drilled per year following an initial discovery well up to 10
total successful wells
200 Befe gross reserves per well (95% natural gas, 5% condensate)
Drilling cost per well of $100 million
Completion cost per well of $100 million
- Facilities cost of $43 million per well
1 year drilling duration per well and 6 months to complete per well
Wells commence 18 months following spud date
■
NYMEX strip pricing as of November 1, 2012 through 2016E and held flat thereafter
■ Assumed 35% U.S. Federal corporate tax rate
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