ANALYST
CONFERENCE
December 17, 2013
Forward-looking Statements and Other Matters
This presentation contains certain “forward-looking statements” within the me...
Eastern Mediterranean
Keith Elliott
Senior Vice President
Eastern Mediterranean
World-class discoveries with world-class opportunities
 Approximately 40 Tcf Gross

Resources Disco...
Discovered Resources
Continuing the track record of success
 Leviathan 4 Appraisal Well


Increased mean resources to
19...
Tamar Southwest Discovery
Capturing additional resources to meet growing demand
 Tamar SW Well


New field discovery wit...
Tamar Field
Servicing a growing domestic market
 Outstanding Operational

Capacity and Sale Projection

Performance


On...
Israel Natural Gas Demand Growth
“The Fuel of Choice” supports expanding domestic markets
Contracted Customer
Potential IP...
Israel Natural Gas Demand Growth
17% CAGR for 2013 - 2018

Israel Natural Gas Consumption

MMcf/d, gross

Historic

2,000
...
Market Export Opportunities – Israel and Cyprus
Over 19 Tcf available for export
 Government Export Decision

Upheld by I...
Leviathan Field
Increasing security and reliability of supply
 Resource Estimate Increased to

19 Tcf Gross, 7.5 Tcf Net
...
Leviathan Development
Monetizing 19 Tcf of natural gas
 Phased Development Approach


Diversifies supply to Israel



N...
Regional Market Opportunities
Cost-effective pipeline export options
 Regional Pipeline Exports

up to 2.5 Bcf/d



FPS...
Well-positioned for LNG Export Markets
EMED LNG cost competitive to US, West Africa and Trinidad
MMt/y

Total LNG Cost ($ ...
Floating LNG
Integration of emerging technology
 Floating LNG Continues to Mature


Technical challenges are better unde...
Cyprus Development Options
Strategic location supports multiple development scenarios
TURKEY

 Onshore LNG Facility at Va...
Eastern Mediterranean
A decade of growth for NBL
NOW
Project

2012

2013

2014

2015

2016

2017

2018

2019

2020

AOT Co...
Production and Capital Outlook
Reinvesting for long-term growth

Net Production

MMcf/d

$ MM

Operating Cash Flow and Cap...
Eastern Mediterranean Exploration
Multiple plays with significant potential
 Mesozoic Oil Potential of 3 BBbl


Multiple...
Woodside Leviathan Status
Realizing additional value
 Closing Delayed Pending Resolution of Regulatory Issues


Export p...
Living Our Purpose
Bettering people’s lives where we live and work
 Growing Local Workforce in Israel

and Cyprus
 Inves...
Eastern Mediterranean
Monetizing resources for domestic and worldwide demand
 Israel Natural Gas Demand Grows at 17%

CAG...
Appendix
Price Assumptions

Period

Brent ($/Bbl)

Henry Hub ($/MMbtu)

2013

$90.00

$100.00

$3.50

2014

$95.00

$100.00

$3.75
...
Defined Terms

Term

Definition

Balance Sheet-adjusted

Debt-adjusted per Share Calculations

Normalizes growth funded th...
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East Med Noble.pdf

  1. 1. ANALYST CONFERENCE December 17, 2013
  2. 2. Forward-looking Statements and Other Matters This presentation contains certain “forward-looking statements” within the meaning of the federal securities law. Words such as “anticipates,” “believes,” “expects,” “intends,” “will,” “should,” “may,” and similar expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect Noble Energy’s current views about future events. They include estimates of oil and natural gas reserves and resources, estimates of future production, assumptions regarding future oil and natural gas pricing, planned drilling activity, future results of operations, projected cash flow and liquidity, business strategy and other plans and objectives for future operations. No assurances can be given that the forward-looking statements contained in this presentation will occur as projected, and actual results may differ materially from those projected. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks include, without limitation, the volatility in commodity prices for crude oil and natural gas, the presence or recoverability of estimated reserves, the ability to replace reserves, environmental risks, drilling and operating risks, exploration and development risks, competition, government regulation or other actions, the ability of management to execute its plans to meet its goals and other risks inherent in Noble Energy’s business that are discussed in its most recent Form 10-K and in other reports on file with the Securities and Exchange Commission. These reports are also available from Noble Energy’s offices or website, http://www.nobleenergyinc.com. Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. Noble Energy does not assume any obligation to update forward-looking statements should circumstances or management's estimates or opinions change. This presentation also contains certain historical and forward-looking non-GAAP measures of financial performance that management believes are good tools for internal use and the investment community in evaluating Noble Energy’s overall financial performance. These non-GAAP measures are broadly used to value and compare companies in the crude oil and natural gas industry. Please also see Noble Energy’s website at http://www.nobleenergyinc.com under “Investors” for reconciliations of the differences between any historical non-GAAP measures used in this presentation and the most directly comparable GAAP financial measures. The GAAP measures most comparable to the forward-looking non-GAAP financial measures are not accessible on a forward-looking basis and reconciling information is not available without unreasonable effort. The Securities and Exchange Commission requires oil and gas companies, in their filings with the SEC, to disclose proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. The SEC permits the optional disclosure of probable and possible reserves, however, we have not disclosed our probable and possible reserves in our filings with the SEC. We use certain terms in this presentation, such as “discovered unbooked resources”, “resources”, “risked resources”, “recoverable resources”, “unrisked resources”, “unrisked exploration prospectivity” and “estimated ultimate recovery” (EUR). These estimates are by their nature more speculative than estimates of proved, probable and possible reserves and accordingly are subject to substantially greater risk of being actually realized. The SEC guidelines strictly prohibit us from including these estimates in filings with the SEC. Investors are urged to consider closely the disclosures and risk factors in our most recent Form 10-K and in other reports on file with the SEC, available from Noble Energy’s offices or website, http://www.nobleenergyinc.com. 2
  3. 3. Eastern Mediterranean Keith Elliott Senior Vice President
  4. 4. Eastern Mediterranean World-class discoveries with world-class opportunities  Approximately 40 Tcf Gross Resources Discovered  Outstanding Operational Performance from Tamar  Record Natural Gas Sales in 2013  Averaging 750 MMcf/d since Tamar startup  Growing Domestic and Regional Markets  Israel demand growth expectation increased to 17%  Multiple regional markets emerging  Continuing Exploration and Appraisal Program  3 BBbl and 4 Tcf of remaining potential  Generating Strong Cash Flow  2 Supports next wave of exploration and development projects
  5. 5. Discovered Resources Continuing the track record of success  Leviathan 4 Appraisal Well  Increased mean resources to 19 Tcf gross  Karish Well  Discovered 1.8 Tcf gross resources  Gross Unrisked Mean Resources (Tcfe) 40 7-10 Bbl/MMcf condensate yield  Cyprus A-2 Appraisal Well  Refined gross resource range to 3.6 - 6 Tcf (P75 - P25), mean 5 Tcf  Confirmed reservoir with high-quality and continuity 5.00 18.90 30 20 Excellent deliverability, up to 250 MMcf/d   Tamar SW Discovery  3 Noble Operated Discoveries Mean resources of 700 Bcf gross 10.00 0.50 10 0 0.04 0.87 0.10 1.20 0.04 1.80 0.70
  6. 6. Tamar Southwest Discovery Capturing additional resources to meet growing demand  Tamar SW Well  New field discovery with 700 Bcf gross mean resources  Tamar Tamar SW Strong reservoir deliverability, 250 MMcf/d potential per well Tamar Platform  Supports Expansion Plans  8-mile tie-back to Tamar infrastructure  Provides 85 MMcf/d additional sales realized through downtime mitigation and capacity increase  Anticipated First Production in 2015 4 Mari-B Platform
  7. 7. Tamar Field Servicing a growing domestic market  Outstanding Operational Capacity and Sale Projection Performance  Online within 2.5 years from sanction  Near 100% facility uptime  Current capacity deliverability up to 1 Bcf/d Planned Further Expansion +25% 1.6 Production avg. 750 MMcf/d since startup  Bcf/d AOT Compression +22% 1.2  Quality Investment  $0.90/Mcf F&D, $0.40/Mcf LOE  Average price realization $5.75/Mcf 0.8  200 MMcf/d Onshore Compression Project Expansion Underway   Mid 2015 startup  Project underpinned by IEC expansion option  Additional Expansion to 1.5 Bcf/d Planned for 2016  5 0.4 $220 MM gross investment Supported by identified / executed contracts 2014 2015 2016 0.0 Capacity Expected Annual Avg. Sales
  8. 8. Israel Natural Gas Demand Growth “The Fuel of Choice” supports expanding domestic markets Contracted Customer Potential IPPs Israel Gas Infrastructure Potential Cogens Potential Coal Plant Conversion Haifa Northern Galil Distribution Network  Total Number of Customers More than Doubled in 2012 - 2013 to 15 Tiberias  Gas-fired Independent Southern Galil Distribution Network Power Producers   Tel-Aviv 330 MMcf/d under contract  Expanding Local Distribution Central Region Distribution Network Company Network AOT Jerusalem Jerusalem Region Distribution Network EMG Additional projects are expected to come online in 2014 and 2015 Southern Region Distribution Network  26 MMcf/d under contract  Conversion of Coal-fired Generation Leads to Greater Base Load  Hadera conversion underway, online 4Q 2016, consuming 250 MMcf/d  Additional conversions expected Negev Distribution Network Egypt 6 Dimona
  9. 9. Israel Natural Gas Demand Growth 17% CAGR for 2013 - 2018 Israel Natural Gas Consumption MMcf/d, gross Historic 2,000 Demand Forecast 1,500 Unmet Demand Extra Fuel Oil Burned 1,000 500 0 2004 2006 Power 2008 Other 2010 Industry 2012 2014 Coal Conversion [Hadera] 2016 2018 2020 2022 Potential Coal Conversion Source: Poten and Partners, Israel Electric Corporation, Ministry of Energy and Water Resources, Noble Energy  Additional Domestic Market Opportunities   New desalination plant  Conversion to electric railroad system  7 Compressed Natural Gas for transportation Methanol production
  10. 10. Market Export Opportunities – Israel and Cyprus Over 19 Tcf available for export  Government Export Decision Upheld by Israel Supreme Court Karish Cyprus A Tamar Tanin  Approximately 40% of Israel Discovered Resources Exportable    Leviathan export quota on the order of 9.5 Tcf Dalit Leviathan Tamar is allowed to export 50% of remaining uncontracted quantities ~ 2 Tcf Tamar SW Dolphin Approximately 3 Tcf exportable from smaller fields  19 Tcf is Reserved for Israel Sales  Export Volumes Include Regional and LNG Markets Tamar Dalit Leviathan Dolphin Tanin Karish Tamar SW Cyprus Total Resource (Tcf) Export % Export Volume (Tcf) 10 50% 2.0* 0.5 75%** 0.4 18.9 50% 9.5 0.1 75%** 0.1 1.2 75% 0.9 1.8 75% 1.4 0.7 75%** 0.5 5 100% 5.0 38.2 19.8 * 50% of uncontracted volumes ** Up to 100% at discretion of MEWR 8
  11. 11. Leviathan Field Increasing security and reliability of supply  Resource Estimate Increased to 19 Tcf Gross, 7.5 Tcf Net  High-quality Reservoir  Potential for wells to produce 250 - 350 MMcf/d  Condensate yield 1.8 - 2.0 Bbl/MMcf  Multiple phases of development  Multiple Planned Projects  Domestic and export options being progressed  Sanction Driven by Market and Regulatory Maturity  Focus on Partnering with Governments and Customers 9 #3 Drilled and Evaluated #1 Drilled and Evaluated #4 Drilled and Evaluated
  12. 12. Leviathan Development Monetizing 19 Tcf of natural gas  Phased Development Approach  Diversifies supply to Israel  New regional and LNG markets  Development Options Progressing   800 MMcf/d fixed / floating facility • 5 Tcf targeting domestic and regional markets • $2.9 B gross investment 500 - 800 MMcf/d (3.2 - 4.8 MTPA) floating LNG • 5 Tcf export • $1 B upstream gross investment • Assumes third-party FLNG vessel tolling arrangement  1,600 MMcf/d FPSO • 9 Tcf expanding domestic and regional markets • $4.6 B gross investment  Targeting Initial Production in 2017 10 Leviathan FPSO Leviathan FLNG Fixed Platform
  13. 13. Regional Market Opportunities Cost-effective pipeline export options  Regional Pipeline Exports up to 2.5 Bcf/d   FPSO LEBANON 11 Cyprus LNG plant approx. 500 MMcf/d Turkey up to 1 Bcf/d market upside by 2020 Domestic Average Israel Price ISRAEL JORDAN Existing LNG Facilities Proposed Pipeline   Expecting Pricing Above PA EGYPT Cyprus domestic market of 60 - 100 MMcf/d  Vasilikos SEGAS Egypt existing LNG facilities with 2.1 Bcf/d demand capacity, only 25% utilized SYRIA CYPRUS ELNG Jordan power and industrial needs of 300 - 400 MMcf/d  TURKEY
  14. 14. Well-positioned for LNG Export Markets EMED LNG cost competitive to US, West Africa and Trinidad MMt/y Total LNG Cost ($ / MMbtu) Global LNG Demand & Supply 550 500 West Australia 450 East Africa 400 Remaining market opportunity 350 300 Oceania* 250 Others 200 Sabine Pass T5 Freeport Cove Point Cameron Western Canada Mozambique Tangguh T3 Sakhalin II Expansion Eastern Med USEC* (via Suez Canal) West Africa USGC* (via Suez Canal) E. Med. (via Suez Canal) East Australia 150 West Canada 100 End 2012 demand Existing production decline *Oceania = Australia and PNG Ramp-ups of new projects Under construction Planned Source: Poten and Partners Planned (less likely) 2022 demand USEC (via Panama Canal) USGC (via Panama Canal) * USGC = US Gulf Coast * USEC = US East Coast 0 2 4 6 8 10 12 14 Source: Poten and Partners  Demand for LNG Projected to Remain Strong Through end of the Decade  Markets Generally Expected to Yield Higher Netbacks to Eastern Mediterranean  Favorable Balance of CAPEX and Shipping Costs Position the Basin Competitively for LNG Markets 12
  15. 15. Floating LNG Integration of emerging technology  Floating LNG Continues to Mature  Technical challenges are better understood and robust solutions being developed  Industry experience with complex FPSOs reduces execution risk  Robust Economics Exist  Strong LNG markets with favorable netback prices  Relatively small upstream investment  Leviathan FLNG  Pre-FEED studies confirmed technical and commercial viability  Developed designs for 3.25 MTPA and 4.8 MTPA capacity units  FEED tendering and evaluation process progressing with strong market interest  Commercial Structure Being Developed  Gas Marketing Commenced 13
  16. 16. Cyprus Development Options Strategic location supports multiple development scenarios TURKEY  Onshore LNG Facility at Vasilikos with Domestic To Europe Vasilikos Supply Component  Requires additional discovered resources ISRAEL  Pre-FEED completed as part of overall concepts selection study  Individual trains sized at 4 - 7 MTPA for maximum efficiency  4 years from FID to first gas  Site has capacity for up to three trains in facility To Asia EGYPT TURKEY Vasilikos To Europe  Floating LNG  Discovered resources support 4 MTPA development  ISRAEL To Asia Target 3 - 4 years from FID to first gas EGYPT Vasilikos  Pipeline to Egypt Onshore LNG Facilities  Provides connection to under-utilized infrastructure  3 - 4 years from FID to first gas completion ISRAEL EGYPT Domestic Pipeline Potential LNG Plant Potential Export Route 14 Deepwater Host LNG Cargos 3rd Party LNG Plant
  17. 17. Eastern Mediterranean A decade of growth for NBL NOW Project 2012 2013 2014 2015 2016 2017 2018 2019 2020 AOT Compression First Gas Tamar SW Drill & Complete Planned Tamar SS Expansion Leviathan Initial Phase 1,600 MMcf/d FPSO FLNG Cyprus LNG Gross Production Bcf/d, gross 5  Eastern Mediterranean Gas 4 Sales 10-year CAGR of 21%  Exports Grow Production 3 by >150% by Next Decade 2  Regional Pipelines May 1 0 2013 2015 Israel Domestic 15 2017 2019 2021 Israel and Cyprus Export 2023 Permit Accelerated Exports
  18. 18. Production and Capital Outlook Reinvesting for long-term growth Net Production MMcf/d $ MM Operating Cash Flow and Capital 1,200 600 1,000 23% CAGR 800 400 600 400 200 200 0 2013 0 2014 Other 2015 Tamar 2016 Tamar SW 2017 2014 2018 Leviathan (200) 2015 BT Operating Cash Flow* Free Cash Flow* 16 * Term defined in appendix 2016 2017 2018 Organic Cash Capital*
  19. 19. Eastern Mediterranean Exploration Multiple plays with significant potential  Mesozoic Oil Potential of 3 BBbl  Multiple opportunities in Israel and Cyprus  Cretaceous targets in structural and stratigraphic traps  Ongoing maturation with 3D reprocessing  Strong evidence of a deeper, thermogenic petroleum system  Miocene Gas Play in Cyprus  Recently acquired 3D seismic Tcfe Gross Unrisked Mean Resources 160 Natural Gas 120 Crude Oil 80 Cyprus Mesozoic Oil Leads & Prospects; 1,496 MMBoe 40 Israel Mesozoic Oil Leads & Prospects; 1,538 MMBoe 0 Noble Operated Discoveries 17 Noble Operated Prospects Noble Operated Prospects * Source: USGS, includes gas, oil, and natural gas liquids Remaining Levant Basin Potential * Prospective NBL Oil Resources
  20. 20. Woodside Leviathan Status Realizing additional value  Closing Delayed Pending Resolution of Regulatory Issues  Export policy  Anti-trust  All Parties Engaged in Negotiations  Targeting Structure that Recognizes Increased Optionality in the Region 18
  21. 21. Living Our Purpose Bettering people’s lives where we live and work  Growing Local Workforce in Israel and Cyprus  Investing in Projects to Promote Education and Technology  Positive Social and Environmental Impacts in Israel   Clean natural gas displacing costly imports of coal and liquid fuels  19 $145 B in energy savings and government revenue over the life of Tamar Greenhouse gas emissions expected to be reduced by 215 MM metric tons of CO2 versus fuel oil, equivalent to taking all the cars off of the road in Israel for 16 years
  22. 22. Eastern Mediterranean Monetizing resources for domestic and worldwide demand  Israel Natural Gas Demand Grows at 17% CAGR 2013 - 2018  Exceeds 1.5 Bcf/d by 2018  Leviathan Multiple Development Options Under Consideration  Domestic and regional export project with 800 MMcf/d capacity targeted to commence for 2017  Over 19 Tcf Available for Export Markets  Regional opportunities exceed 2 Bcf/d  Gross Unrisked Exploration Prospectivity of 3 BBbl of Oil and 4 Tcf Natural Gas  A Decade of Growth Ahead  20 Net production growing to 0.6 Bcf/d in 2018 and 1.1 Bcf/d in 2023
  23. 23. Appendix
  24. 24. Price Assumptions Period Brent ($/Bbl) Henry Hub ($/MMbtu) 2013 $90.00 $100.00 $3.50 2014 $95.00 $100.00 $3.75 2015 $90.00 $95.00 $4.25 2016 $90.00 $95.00 $4.50 2017 $90.00 $95.00 $4.75 2018 + 2 WTI ($/Bbl) $90 through 2020 then + 2% / yr $95 through 2020 then + 2% / yr + $0.25 / yr through 2023 then + 2% / yr
  25. 25. Defined Terms Term Definition Balance Sheet-adjusted Debt-adjusted per Share Calculations Normalizes growth funded through debt by converting the change in debt into an equivalent amount of equity shares using an average stock price. The equivalent shares are netted with total shares outstanding which impacts the per share calculations of reserves, production and cash flow Cash Flow at Risk (CFAR) The difference between NBL's base plan Cash Flow from Operations and NBL's Cash Flow from Operations at the 95% worst case scenario based on a simulation of commodity prices using a mean reversion model Discretionary Cash Flow Cash Flow from Operations excluding working capital changes plus cash exploration expense Free Cash Flow Operating Cash Flow less Organic Cash Capital Funds from Operations (FFO) Cash Flow from Operations excluding working capital changes Liquidity Cash and unused revolver capacity Net Risked Resources Estimated gross resources multiplied by the probability of geologic success and NBL’s net revenue interest Operating Cash Flow Revenue less lease operating expenses, production taxes, transportation, and income taxes Organic Cash Capital Capital less capitalized interest, capital lease payments and acquisitions Peers – Investment Grade – Non-Investment Grade APA, APC, DVN, EOG, MRO, MUR, PXD, SWN CHK, CLR, COG, NFX, PXP, RRC Return on Average Capital Employed (ROACE) Earnings before interest and tax (EBIT) plus asset impairments and unrealized mark to market derivatives divided by average total assets plus impairments less current liabilities Total Debt 3 The comparison of production or cash flow growth to enterprise value growth. The numerator is the result of dividing the year-two underlying metric (production or cash flow) by the respective year-one value. The denominator is the yeartwo enterprise value divided by year-one enterprise value, both using the year-one stock price to eliminate distortion of changing stock market prices Long-term debt including current maturities, FPSO lease and JV installment payments

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