UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): December 9, 2013
LAREDO PETROLEUM HOLDINGS, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware | 001-35380 | 45-3007926 | ||
(State or Other Jurisdiction of Incorporation or Organization) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||
15 W. Sixth Street, Suite 1800, Tulsa, Oklahoma | 74119 | |
(Address of Principal Executive Offices) | (Zip Code) | |
Registrant’s telephone number, including area code: (918) 513-4570
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 7.01. Regulation FD Disclosure.
On December 9, 2013, Laredo Petroleum Holdings, Inc. (the "Company") issued a press release announcing its anticipated 2014 capital budget. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated into this Item 7.01 by reference.
Also on December 9, 2013, the Company posted to its website its Corporate Presentation for December 2013. The presentation is available on the Company's website, www.laredopetro.com, and is furnished as Exhibit 99.2 to this Current Report on Form 8-K and incorporated into this Item 7.01 by reference.
All statements in the press release and presentation other than historical financial information, may be deemed to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. See the Company's filings with the SEC for a discussion of other risks and uncertainties. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
In accordance with General Instruction B.2 of Form 8-K, the information in this report (including Exhibit 99.1 and Exhibit 99.2) is deemed to be “furnished” and shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall such information and Exhibits be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit Number | Description | |
99.1 | Press release. | |
99.2 | Corporate Presentation December 2013 | |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
LAREDO PETROLEUM HOLDINGS, INC. | ||
Dated: December 9, 2013 | By: | /s/ KENNETH E. DORNBLASER |
Kenneth E. Dornblaser | ||
Senior Vice President and General Counsel | ||
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EXHIBIT INDEX
Exhibit Number | Description | |
99.1 | Press release. | |
99.2 | Corporate Presentation December 2013 | |
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EXHIBIT 99.1
15 West 6th Street, Suite, 1800 · Tulsa, Oklahoma 74119 · (918) 513-4570 · Fax: (918) 513-4571
www.laredopetro.com
Laredo Petroleum Announces 2014 Capital Budget of $1 Billion
TULSA, OK - December 9, 2013 - Laredo Petroleum Holdings, Inc. (NYSE: LPI) (“Laredo” or “the Company”), today announced that its Board of Directors has approved a $1 billion capital budget for 2014, excluding acquisitions. Approximately 84% of the capital budget is focused on drilling and completion activities, approximately 13% for facilities and 3% for land, seismic and other capital. This development-focused capital program is expected to drive an approximate 30% annual growth in production volumes from the Company’s Permian Basin properties.
“We are now moving into full-scale development of our Permian-Garden City asset,” explained Randy A. Foutch, Laredo’s Chairman and Chief Executive Officer. “Laredo’s expected activities for 2014 represent the culmination of the process we put forward in 2012 to confirm a significant portion of our acreage for horizontal development from multiple zones and the optimal spacing, both vertically and horizontally, of the laterals. With the success of these programs, we are now beginning to implement our multi-zone development plan by building out several production corridors to support more efficient, multi-well pad development. Expected cost savings associated with this plan will serve us well as we begin the ramp-up of development drilling activities to accelerate the value recognition from our Permian-Garden City asset.”
The 2014 capital budget of $1 billion, which is expected to be funded from internally-generated cash flow and borrowings under the Company’s senior secured credit facility, is allocated as follows:
($ in millions) | |||
Horizontal Drilling | $ | 545 | |
Vertical Drilling | 240 | ||
Non-operated | 55 | ||
Drilling and Completion | 840 | ||
Facilities | 130 | ||
Land and Seismic | 20 | ||
Other | 10 | ||
Total | $ | 1,000 | |
The Company’s drilling capital in 2014 will be concentrated on horizontal development of the Upper, Middle and Lower Wolfcamp and Cline shale zones, primarily with two, three and four-stacked laterals from multi-well pads. Additionally, the Company will continue delineation efforts across its approximate 142,000 net acres of Permian-Garden City leasehold by horizontally testing additional zones and acreage. Laredo expects to operate six to seven horizontal rigs during 2014 and anticipates drilling approximately 70-75 gross horizontal wells, 85% of which will be development wells. The Company also expects to operate five vertical rigs to drill approximately 120-125 gross wells for development and data gathering purposes as well as meeting lease maintenance obligations.
To maximize efficiency, rigs drilling development wells will operate in concentrated geographic areas where the Company has started building out production corridors to maximize the cost savings from common facilities. The Company's facilities capital expenditures in 2014 are expected to focus on building out the core infrastructure that will enable the Company’s transition to full-scale hydrocarbon manufacturing. Laredo is building multiple production corridors that will support development drilling for hundreds of wells and are expected to benefit the future cost structure of the Company.
Total annual production for 2014 is expected to range from 12.2 million to 12.7 million barrels of oil equivalent (“BOE”), or approximately 33,400 to 34,800 BOE per day, on a two-stream basis. Production is expected to be comprised of approximately 58% oil and 42% high (>1,300) British thermal unit (“Btu”) natural gas.
The Company actively monitors commodity prices and service costs and may make adjustments to the capital budget and guidance as conditions warrant. Laredo has underpinned a portion of cash flow by hedging production with commodity derivative instruments, which currently cover approximately 45% of projected oil production and 30% of projected natural gas production for 2014 with weighted-average floor prices of $87.35 per barrel of oil and $3.00 per MMBtu of natural gas.
Laredo Petroleum Holdings, Inc. is an independent energy company with headquarters in Tulsa, Oklahoma. Laredo's business strategy is focused on the exploration, development and acquisition of oil and natural gas properties primarily in the Permian region of the United States.
Additional information about Laredo may be found on its website at www.laredopetro.com.
Forward-Looking Statements
This press release contains forward-looking statements as defined under Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical facts, that address activities that Laredo assumes, plans, expects, believes, intends, projects, estimates or anticipates (and other similar expressions) will, should
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or may occur in the future are forward-looking statements. The forward-looking statements are based on management's current belief, based on currently available information, as to the outcome and timing of future events.
General risks relating to Laredo include, but are not limited to the risks described in its Annual Report on Form 10-K for the year ended December 31, 2012, Quarterly Report on Form 10-Q for the quarter ended June 30, 2013, and those set forth from time to time in other filings with the Securities and Exchange Commission (“SEC”). These documents are available through Laredo’s website at www.laredopetro.com under the tab “Investor Relations” or through the SEC’s Electronic Data Gathering and Analysis Retrieval System ("EDGAR") at www.sec.gov. Any of these factors could cause Laredo's actual results and plans to differ materially from those in the forward-looking statements. Therefore, Laredo can give no assurance that its future results will be as estimated. Laredo does not intend to, and disclaims any obligation to, update or revise any forward-looking statement.
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Contacts:
Ron Hagood: (918) 858-5504 - RHagood@laredopetro.com
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EXHIBIT 99.2
