Filed by Helmerich & Payne Exploration and Production Co.
Pursuant to Rule 425 under the Securities Act of 1933
and deemed filed pursuant to Rule 14a-12
of the Securities Exchange Act of 1934
Subject Company: Helmerich & Payne Exploration and Production Co.
Commission File No.: 132-02238
#1
[H&P LOGO
OMITTED]
Howard Weil
Energy Conference
April 9, 2002
Hans C. Helmerich
President and Chief Executive Officer
George S. Dotson
President, Helmerich & Payne IDC
#2
[H&P LOGO Helmerich & Payne Inc.
OMITTED]
The information contained within this presentation is forward looking and
involves risks and uncertainties that could significantly impact expected
results. A discussion of these risks and uncertainties is contained in the
Company's Form 10-K filed with the Securities and Exchange Commission on
December 27, 2001.
#3
[H&P LOGO
OMITTED]
A New Look For An 82 Year Old Company
>> H&P to Become a "Pure Play" [PIE CHART GRAPHIC OMITTED]
>> H&P's Total Rig Fleet to Increase by 33%
from 2001 & 2003
[BAR CHART GRAPHIC OMITTED]
#4
[H&P LOGO HELMERICH & PAYNE, INC.
OMITTED] (pre-transaction)
[PIE CHART GRAPHIC OMITTED]
Contract Drilling E&P Portfolio
----------------- --------- ---------
101 rigs 245 Bcfe $310MM
> ~ $2.0 billion market cap
> ~ 50 million shares outstanding
#5
[H&P LOGO Exploration & Production Division
OMITTED] Spun Off As Cimarex Energy Co.
[PIE CHART GRAPHIC OMITTED]
H&P Cimarex
----------------- ---------------------------
Contract Drilling Cimarex to H&P Shareholders
Portfolio
#6
[H&P LOGO
OMITTED]
HELMERICH & PAYNE, INC.
E&P
---
> Implied value of E&P division
$475 million, ($9.50 per
[PIE CHART GRAPHIC OMITTED] H&P share) based on recent
KP stock price ($18)
> Portfolio market value at
4-1-02 of $310 million
($6.22 per H&P share)
#7
[H&P LOGO SPIN/MERGE GOALS
OMITTED]
> Increase focus and visibility
> Use financial strength to enhance shareholder value
> Strengthen E&P division's position
> Capture tax efficiency
#8
[H&P LOGO
OMITTED] WHY KEY PRODUCTION?
> Impressive people and organization
> Complementary and overlapping asset base
> Strong balance sheet
> Similar philosophies and cultures
#9
[H&P LOGO KEY PRODUCTION RECORD OF GROWTH
OMITTED]
($ in millions) 1992 2001
---- ----
Market Cap $ 25 $ 240
Debt $ 3 $ 34
Stock price ($/share) $ 3 $ 17
Reserves (Bcfe) 38 147
Reserves (Mcfe/share) 3.6 10.5
Production (Bcfe) 8.3 26.0
#10
[H&P LOGO COMBINED PROPERTIES
OMITTED]
___________________________________
Helmerich & Payne, Inc.
-----------------------------------
Proved reserves (Bcfe) 245
% Natural gas 87%
Production (MMcfe/d) 116
[MAP GRAPHIC OMITTED] Net undeveloped acres 150,401
___________________________________
Key Production Company
Denver -----------------------------------
Tulsa
District Operating Offices Proved reserves (Bcfe) 147
% Natural gas 62%
Production (MMcfe/d) 74
Net undeveloped acres 119,251
#11
[H&P LOGO
OMITTED] CIMAREX ENERGY
Key H&P Combined
YE01 Proved reserves (Bcfe) 147 245 392
2002E Production, MMcfe/d 74 116 190
% Gas Production 65% 90% 80%
2001 EBITDAX $80 $146 $226
Employees 95 150 245
#12
[H&P LOGO
OMITTED]
EQUITY MARKET CAP
[BAR GRAPH graphic omitted
($ in millions)
KP NEV MHR PRZ KWK DNR ROIL EAC POG MARY Cimarex COG EVG WRC TMBR PRS
-- --- --- --- --- --- ---- --- --- ---- ------- --- --- --- ---- ---
222 242 257 271 336 355 359 396 559 566 600 631 679 896 965 996
#13
[H&P LOGO CIMAREX ENERGY RECAP
OMITTED]
> New independent with critical mass of people and assets
> $700MM equity market cap
> Limited debt and substantial financial capacity
> Predominantly Mid-Continent production base
> Gulf Coast and Mid-Continent oriented exploration programs
> Strong management team with proven track record
#14
[H&P LOGO Helmerich & Payne, Inc.
OMITTED]
Balance Sheet as of 12/31/01
------------------------------------------------
Consolidated H&P E&P H&P, Inc.
------------ ------- ---------
Current Assets $ 268.1 $ 39.2 $ 228.9
Investments 230.1 0 230.1
PP&E (net) 860.7 162.1 698.6
Other 13.4 .2 13.2
--------- ------- --------
Total Assets $1,372.3 $ 201.5 $1,170.8
======== ======= ========
Current Liabilities $ 79.8 $ 40.2 $ 39.6
Long-Term Debt 50.0 0 50.0
Deferred Taxes / Other 186.4 21.8 164.6
Shareholders' Equity 1,056.1 139.5 916.6
--------- ------- -------
Total Liabilities and
Shareholders' Equity $1,372.3 $ 201.5 $1,170.8
======== ======= ========
#15
[H&P LOGO Helmerich & Payne, Inc.
OMITTED]
What makes H&P attractive as a "pure play" contract drilling company?
> Unique Strategy
> Expanding Rig Fleet
> Strong balance sheet
> Additional analyst coverage and ownership interest
#16
[H&P LOGO Helmerich & Payne, Inc.
OMITTED]
[BAR GRAPH GRAPHIC OMITTED]
Total Rigs
----------
1998 1999 2000 2001 2002E 2003E
---- ---- ---- ---- ----- -----
90 90 88 96 113 128
#17
[H&P LOGO Helmerich & Payne, Inc.
OMITTED]
H&P RIG LOCATIONS
-----------------
[NORTH AMERICA/SOUTH AMERICA MAP GRAPHICS OMITTED}
> 70 U.S. rigs
U.S. 58
Gulf of Mexico 12
> 33 International rigs
Offshore Colombia 3
Ecuador 8
Venezuela 14
Bolivia 6
Argentina 2
---
> 103 Total rigs 103
4 Management Contracts
#18
[H&P LOGO Helmerich & Payne, Inc.
OMITTED]
Rigs
Available Working / Contracted
--------- --------------------
U.S. Land, Mobile & FlexRigs(TM) 29 100%
U.S. Land, Conventional 29 69%
U.S. Platform 12 83%
International Land 33 48%
--- ---
Total 103 73%
FlexRig(TM) hereinafter referred to as FlexRig
#19
[H&P LOGO U.S. Land Rigs
OMITTED]
Rig Utilization
This slide contains a chart that indicates rig utilization for US land
rigs of Helmerich & Payne compared with the industry during the period from
July 2001 until April 2002. Helmerich & Payne had greater percentage of rig
utilization in that period. As of April 2002, Helmerich & Payne's rig
utilization is 84% compared to the industry rig utilization of 53%.
#20
[H&P LOGO Safety
OMITTED]
Total H&P vs. IADC safety performance 2001*
Incidence Rate H&P IADC Difference
Total recordable 1.83 4.72 61% lower
Lost Time Incident (LTI) 0.12 1.26 90% lower
Sustained LTI-free Operations
Shell U.S. PdVSA BP Conoco
Man-hours (MM) 5.0 2.9 2.5 1.5
Rig years 39 24 20 25
Consecutive 8.0 3.7 1.5 3.7
#21
[H&P LOGO Helmerich & Payne, Inc.
OMITTED]
#22
[H&P LOGO Helmerich & Payne, Inc.
OMITTED]
[Pictures omitted]
#23
[H&P LOGO
OMITTED]
FlexRig
The BEST VALUE rig for a wide range of wells
25 new FlexRigs delivered May 2002 - June 2003
#24
[H&P LOGO U.S. Rigs Drilling 1982
OMITTED]
This slide contains a graphic depicting the total percentage of Helmerich
& Payne's U.S. rigs drilling at various well depths from 1982-2001. In 1982,
1%were drilling at greater than 20,000 feet, 3% at 17,501 feet to 20,000 feet,
5% at 15,001 feet to 17,500 feet, 29% at 10,001 to 15,000 feet and 62% at 0 to
10,000 feet. In 2001, 2% were drilling at greater than 20,000 feet, 4% at
17,501 feet to 20,000 feet, 7% at 15,001 feet to 17,500 feet, 43% at 10,001 to
15,000 feet and 44% at 0 to 10,000 feet.
#25
[H&P LOGO Strengths of FlexRigs
OMITTED]
1. Safety: During 1998-2001, 36% fewer injuries (TRIR) vs
H&P conventional rigs
2. Activity: 96% activity for all Mobile & FlexRigs since July 1994
#26
[H&P LOGO Strengths of FlexRigs
OMITTED]
3. Fast move times - 1500 HP Rigs
Average days per 40 mile move
FlexRigs (257 moves) 2.4 days
Conventional Rigs (49 moves) 6.7 days
#27
[H&P LOGO Strengths of FlexRigs
OMITTED]
4. Flexible Depth Range Wells
R168 Nov '99 - March '02
Depth # of Wells
8-9,000 5
9-11,000 2
11-14,000 6
14-18,000 6
#28
[H&P LOGO Total Rigs
OMITTED]
This slide graphically depics the number of total rigs for years 1998 -
2003 (estimated), as well as the number of mobile and flex rigs in each year.
In 1998, the total number of rigs was 90, 16 of which were mobile and flex
rigs. In 1999, the total number of rigs was 89, 17 of which were mobile and
flex rigs. In 2000, the total number of rigs was 88, 17 of which were mobile
and flex rigs. In 2001, the total number of rigs was 96, 25 of which were
mobile and flex rigs. In 2002, it is estimated that the total number of rigs
will be 113, 39 of which are estimated to be mobile and flex rigs. In 2003, it
is estimated that the total number of rigs will be 128, 54 of which are
estimated to be mobile and flex rigs.
[Pictures omitted]
#29
[H&P LOGO EBITDA ($MM)
OMITTED]
EBITDA is represented graphically for the years 1992, in which it was
under $50 million, through 2001, in which it was approximately $190 million.
It is estimated that EBITDA for 2002 will be approximately $150 million. The
peak run rate for 2003 would result in EBITDA of over $350 million.
#30
[H&P LOGO
OMITTED]
Invitation to visit a FlexRig duting OTC, May 7 & 8
Tour new FlexRig 210
Visit the H&P fabrication & training facilities
View new platform Rig 206 (self-moving)
#31
[H&P LOGO
OMITTED]