Niobrara Has Not Yet Proven to be a Resource Play

Transcription

1 21 March 211 Sven Del Pozzo, CFA Has Not Yet Proven to be a Resource Play Key Implications Successful horizontal development of oil limited to handful of E&Ps and fields Early entry and development of the introduces risks, as time is needed to delineate the play Established producers with access to pre-existing seismic and well data, will have an advantage Well performance to date is variable, and has yet to demonstrate resource play predictability Despite this variability, some are citing the play s best wells as indicative of future results E&Ps anticipate experience will enhance both well performance and predictability Acreage should be heavily risked, and low-cost entry into large acreage plots is the key to success E&Ps and investors are growing more optimistic about unlocking the emerging horizontal oil play s resource potential with the aid of experience and technology. The shale formation s vast expanse from Wyoming and Colorado into Nebraska and Kansas makes it possible for even small E&Ps to assemble large, contiguous leaseholds. The is situated at various depths and has diverse rock properties as it spans multiple basins, making it very risky to generalize about prospectivity at this early stage. Acreage Holders Unrisked* Unrisked (') Acres per Value, as % of Net Acres Shares MM Shares $/Share Share Price Share Price Basin DBLE 7, 11,178 6, $ % Washakie WRES 8, 71,348 1, $ % Washakie REXX 45, 44,312 1, $ % Denver Julesburg (DJ) PETD 74, 23,465 3, $ % Denver Julesburg (DJ) KWK 14, 17, $ % Greater Green River CRZO 61, 35, 1, $ % Denver Julesburg (DJ) BBG 9,8 46,876 1, $ % Wind River VOG 14,2 52, $5.4 25% DJ, Weld Cty. SSN 14, 83, $ % DJ, Goshen Cty. 63, 175,75 3, $ % Denver Julesburg (DJ) APC 1,26, 496, 2, $ % DJ & Powder CHK 536, 658, $34. 12% DJ & Powder QEP 139, 176, $ % Denver Julesburg (DJ) GPOR 24,5 44, $31.3 9% NW Colorado MDU 65, 188, $ % Denver Julesburg (DJ) 3, 254,25 1, $ % Denver Julesburg (DJ) SGY 1, 49, $ % Hanna CLR 72, 17, $ % Denver Julesburg (DJ) MRO 17, 71, $ % Denver Julesburg (DJ) WLL 73, 236, $ % DJ, Carbon Cty. CNOOC 264, 44,669,2 6.3 $2.19 1% DJ & Powder 4, 736, $ % Denver Julesburg (DJ) *Valued at $5,/acre, essentially representing CNOOC-CHK /Frontier Deal Value or NPV@1% & $9 oil of well with 6 b/d 24HR IP tracking 's "Jake" well production profile (see bottom of p. 8). Does not Discount for Geological Risk or Pace of Development. Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 1

2 JAKE (24-Oct-9) ELMER (23-Mar-1) POLL RED (25-Mar-1) GARDEN CREEK 6-11H (3-Jun-1) CRITTER CREEK 4-9H (7-Jul-1) Longhorn B 3-36H (2-Sep-1 Critter Creek 6-12H (8-Sep-1) Critter Creek 8-14H (1-Oct-1) Critter Creek 13-7H (24-Oct-1) Garden Creek 9-16H (25-Oct-1) Critter Creek 9-15H (28-Oct-1) Critter Creek 1-2H (13-Nov-1) Elsie 7-34H* (6-Dec-1) Critter Creek 17-21H (26-Dec-1) bbls oil/d Bbl of Oil Per Day Oil resource play optimism is likely driven by repeated success in discovering new, US gas resource plays. Extrapolating success with oil resource plays from gas resource plays may prove an improper assumption. Oil flows with greater difficulty than gas, and often needs artificial lift to produce, raising operating costs. Resources () has recently alluded to this, citing higher downtime in oil wells than in gas wells. Neither do we have long-term production histories for oilier, liquids-rich plays, so the larger the estimated ultimate recovery (EUR) per well, the riskier the estimate, since it likely depends on lengthy well-life. For our analysis, we have limited our investment return analysis to a 2-year well life, which may seem short compared with some E&P estimates, but captures the lion s share of a well s present value. Some of the s positive outlook may also be tied to the success of the Bakken/Three Forks play. We stress that definitive conclusions can t be made at this early stage, as fewer than 2 modern horizontal wells (D-J & North Park Basin) have 365 days of IHS production history, of which less than 1 have a meaningful oil cut. Initial 18 and 365 day production rates for a select handful of the s best horizontal, oil-weighted wells averaged about 95% and 7% (respectively) of the median Bakken well in the core of the play highlighting faster decline rates in the (see page 11 for production profiles). 6 5 Horizontal Oil Declines Faster (Outside of Silo) Than Core Bakken CORE BAKKEN SINCE 29 ALL NIOBRARA Since 28 Top 5 6 Day Avg. 18 Day Avg. 365 Day Avg. Avg. in Month 6 Avg. in Month 12 The median Bakken horizontal well completed since 29 in the core of the play averaged about 23 b/d of oil in its sixth month online. Two modern horizontal wells matched or bested that, with the remaining 1 wells ranging between 1 and 19 b/d of oil. In their sixth month, five of these wells produced 7 b/d or less of oil; three produced between b/d, and the remaining two produced about 185 b/d. The Bakken s production is also predictable over a wide area, compared with well performance that still varies considerably, even in the same field Hereford Ranch-First 3 Days vs. Latest Month Oldest to Newest Completions (Oct-9 to Dec-1) Note: () denotes completion date Critter Creek 2-3H confidential status *Elsie may be confidential status Latest 3 days First 3 days Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 2

3 bbl of oil The s strong, early-month IPs that decline relatively rapidly, beg the questions of whether it is mainly induced fractures that contribute to IP rates, and whether the horizontal oil play can evolve into a resource play like the Bakken. In the large, horizontally developed Silo field, notice that early-month IP rates have little if any correlation to EUR (see page 12, Silo chart). The answer to the resource play debate depends upon the potential contribution of matrix porosity to production, which if present would increase production and reserves, slow decline rates, and enhance the possibility of down-spacing from a typical 64 acres. E&Ps are confident early on, but if matrix contribution is not material, then successful development will continue to be limited to fractured and faulted fields. Most E&Ps are in the early stages of shooting and analyzing 3D seismic to better identify faulting and fracturing. When establishing leaseholds, E&Ps have consulted existing vertical well data, formation thickness, and resistivity, among other factors, and may target anticlinal structures in the hope of encountering natural fractures. We believe patience is a virtue for investors seeking profit as this early-stage play evolves. Operators with the most experience and data to consult will have a leg up on the competition and produce more consistent results earlier in the play s evolution. DJ Basin: To date, successful horizontal development of oil has mainly been limited to the DJ Basin in several naturally fractured fields east and north of Denver, Colorado. These include Wattenberg, just north of Denver in southern Weld County, Colorado; Silo (see page 4, yellow well spots with second-month average oil production enumerated) in Laramie County, southeastern Wyoming; and Hereford Ranch (see page 4, lime green well spots), about 3 miles south of Silo in northern Weld County, on Wyoming s southeastern border. The is situated at 7,5-8,8 feet of depth at Silo, compared with 7,-7,5 feet deep at Hereford Ranch, where the Jake and the Critter Creek 4-9H and 9-15H wells were drilled. These are some of the best wells in the field with a reliable production history. Silo was horizontally developed in the early- to mid-199s, mainly by Union Pacific Resources (acquired by Anadarko) before the advent of multistage hydraulic fracturing. Many Silo wells were noteworthy for sustained production rates over several years. SM Energy and Rex Energy (REXX) are in the early stages of drilling modern wells at Silo. A few modern Silo wells have been reported thus far with mixed results, and time will tell how modern completion technique can affect a partially depleted field. E&Ps have also mentioned geological similarities between Silo and southeastern Wyoming / northeastern Colorado, but at this early stage, we would exercise caution in drawing parallels with Silo to more recently developed fields, as it seems somewhat unique. About one-third of Silo s horizontal wells sustained 1-3 bo/d production rates for over two years, compared with 1-2 bo/d rates sustained for six months to a year for the best oil-weighted modern horizontal wells in the play, most of which are s at Hereford Ranch. 1, 9, 8, First Year Cumulative Oil Production: Silo Field Seems Unique 7, 6, 5, 4, 3, 2, 1, Silo (Ex-Silo) CHK (Spillman Draw Deep) Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 3

4 Southern DJ & North Park Basin Completions with 2 nd Month Average Oil Production Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 4

5 s early success at Hereford Ranch late in 29 likely spurred a nearby land grab by E&Ps, including Carrizo Oil and Gas (CRZO), REXX, Continental Resources (CLR), Whiting Petroleum (WLL) and QEP Resources (QEP). Continental already has experience developing the at the Silo field, and will be drilling the play s first long lateral on 1,28-acre spacing as it transfers its knowledge as one of the Bakken s most efficient operators to the in northeast Colorado. Notwithstanding what appears to be a lengthening trend of variability in well performance at Hereford Ranch based on recent one-month average IP rates (see page 2, chart), recently expressed increasing confidence about the possibility of matrix porosity contributing to production. is experimenting with restricted choke sizes to enhance EUR (Elsie 7-34H and Critter Creek 13-17H), which could make early-month IP rates even less meaningful, and future decline rates and EUR more relevant, to valuation. Noble, another premier Rockies operator, is focusing on its Wattenberg leasehold (see page 5, sky blue well spots), and suggested possible matrix contributions based on the few modern wells it has drilled north of Wattenberg. Potential contribution from matrix porosity would increase reserves per well and expand the play beyond naturally fractured fields and convert it into a true resource play. However, widespread matrix contribution is far from proven, despite some early optimism in the industry. is also responsible for the only horizontally developed oil field to date west of the Front Range, developed in 27-28, in the North Park Basin in northwestern Colorado, where the is also naturally fractured and situated at approximately 7, feet. We would imagine such fields to be somewhat unique, considering the geological complexity of the region. About 12 miles to the southeast of Chugwater, Wyoming, is s next region of exploration, dubbed Silvertip. This is in the northern DJ Basin (north of Silo), where the northern border of Laramie County meets the southern border of Wyoming s Platte and Goshen counties. Results of s first well, Silvertip 5-34H in Goshen County, are highly anticipated, as has been actively permitting and drilling in the area. In this region, logs indicate the s depth is similar to that at Silo. Wattenberg Field, Southern Weld County, CO: Noble Wattenberg Field Acreage The is a shallower secondary target of vertical gas wells in the field that primarily targeted the deeper J-sand and Codell pay zones. Based only on publicly stated IP rates, Noble Energy () seems to benefit greatly from having extensive vertical well and seismic data to consult when horizontally exploring and developing the at Wattenberg, which may help explain reportedly more consistent results. has indicated minimal interference between vertical and horizontal wells, which bodes well for down-spacing. Given the variability in well performance witnessed to date in different parts of the play, s development approach resonates with us. The company states that it will first focus on exploring the within the existing Wattenberg field area, which it understands best and where it has infrastructure, before focusing on delineating its extensive leaseholdin northeastern Weld County, Colorado, and in Laramie and Goshen County, Wyoming (see acreage, page 7). s announced onemonth average IP rates seem to be the most consistent thus far in the play, with 2 horizontal wells averaging over 5 boe/d. It also says its liquids cut rises from 45%-75% when moving from the central core of the field to its oiler, cooler, periphery. Source: Noble This higher gas cut may help to lift the oil, lowering operating costs, versus a9% oil cut at Silo and Hereford Ranch. is in the early stages of developing acreage to the north (Grover area) and northeast of Wattenberg, where it has had mixed results on several wells. estimates 1.7 billion Boe of unrisked resource potential on its 83, net acres in the play. That Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 5

6 appears more conservative than Chesapeake Energy s (CHK) estimates on its acreage, which is more heavily weighted to the earlier stage Powder River Basin. Anadarko (APC) also has a large position at Wattenberg. Chesapeake Acreage Noble Acreage Source: Noble Southern Powder River Basin: In addition to DJ Basin, where CHK has not yet publicly announced results, and moving north from Silo, CHK is developing the Southern Powder River Basin, which is an even earlier-stage play that is Source: Chesapeake geologically distinct, much deeper (12,5 feet), less porous, and under greater pressure than in the DJ. CHK has publicized one definitive success thus far, Spillman Draw Deep (87% oil), completed in mid-october 29 in Converse County, Wyoming. It is one of the best wells in the play and of great interest because it suggests a northern extension of the play, but we await a number of follow-up wells. It averaged about 47 b/d of oil production in its first month of substantial oil production, and after a year declined about 75% to roughly 12 b/d. In nearly its first year online, production averaged about 195 b/d of oil. CHK has also reported some results of the Spillman Draw Deep Unit State 16-1H, drilled to 12,6-foot vertical depth with nearly a 5,-foot lateral, with a publicly stated IP of about 65 bbl of oil over an undetermined period. CHK has reported 3 billion boe of resource potential on its 535, net acres in the after selling down its interest to CNOOC, which appears to be a more aggressive estimate than s. CHK has publicly stated that it operates over 16 producing wells in the DJ and Powder River Basins that have tested at IP rates of up to 1, bbl of oil and 3. MMcf of natural gas per day, but we can t specify the testing parameters. Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 6

7 Northern DJ Completions with 2 nd Month Average Oil Production Wind River Basin: Bill Barret Corp. (BBG) has a large legacy acreage position in the middle of Wyoming with no well data to report thus far, and did mention some geological similarities between the Wind River and southern Powder River Basin, with depths varying from 4, to 14, feet. BBG has 3D seismic to consult and its first well will be completed in the summer of 211. Washakie Basin: Located in the middle of Wyoming s southern border with Colorado, due south of the Wind River Basin, Anadarko Petroleum (APC), and minnows Warren Resources (WRES) and Double Eagle Petroleum (DBLE) all develop Atlantic Rim coalbed methane, which may help secure development rights to the deep. Valuation: IHS data suggests publicized industry -type curves and EURs mimic s Jake 2-1H well completed in late October 29 at Hereford Ranch, whose early success incited the region s land grab. The Jake well is one of the field s best oil wells to date, along with Critter Creek 4-9H and 9-15H (see page 2). We caution against using the Jake well as a type-well, because it is one of the best wells, not an average well. Results are highly variable even within the Hereford Ranch field, where the Jake well was drilled. We ran an oil price scenario analysis around the Jake well, purposely selected to reflect a best-case outcome ( see results tabulated on page 8). We conclude that NPV-based acreage values can conceivably attain non-core Bakken-like metrics on a one-off basis, but until the play can demonstrate the predictability of a resource play, the industry and investors alike must risk acreage heavily, ensuring cheap entry into large leaseholds, relative to unrisked NPV-based values. Similarly, if an E&P s leasehold is relatively small, and it is a newcomer to the area, the chance of discovering new fields is more remote, based on the data we have analyzed to date. Our modeling applies Jake well percentage declines to initial 24-hour production rates, concluding that at $9 oil, a minimum 24-hour initial flow rate of 375 bo/d is needed to have NPVat a 1% break-even. In its first calendar month online, the Jake well averaged 68 bo/d. Note that for investment performance to be attractive, even at $8 oil, the 24-hour IP rate needs to be at least 5 bo/d. Inputs: Completed Well Cost (CWC): $4.2MM (top of the industry guidance range) Lifting Costs per BOE: $13./boe (water disposal $3-$4/bbl) Severance tax: 13% Royalty: 18% Oil/Gas Split: 9% oil / 1% gas Differentials: Oil ($1); Gas ($1.5) or $3.1 flat at well-head Gross EUR: 3, Boe at $9/bbl oil reference price ($8 at well-head) with 24HR 8 boe/d IP, 2 Year life Decline Rates: Shown Beneath Table Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 7

8 Shale: Jake Well (Horizontal Well, Weld County, CO, Hereford Ranch Field) IRR $5 Oil $6 Oil $7 Oil $8 Oil $9 Oil $1 Oil $11 Oil $12 Oil $13 Oil 24 Hour IP Rate, b/d oil 8 24% 39% 55% 71% 88% 16% 124% 142% 16% 7 15% 27% 4% 54% 69% 84% 99% 114% 13% 6 6% 16% 27% 38% 5% 62% 75% 87% 11% 5-9% 3% 12% 22% 31% 41% 51% 62% 72% 4 NM -12% -2% 6% 14% 21% 29% 37% 45% NPV@1%, $ 's 8 1,188 2,378 3,569 4,759 5,95 7,14 8,331 9,521 1, ,45 2,491 3,533 4,575 5,617 6,658 7,7 8,742 6 (368) 521 1,414 2,37 3,2 4,93 4,986 5,879 6,772 5 (1,295) (565) ,67 2,422 3,175 3,927 4,68 4 (2,4) (1,473) (893) (35) ,484 2,86 2,688 Payout Period, Quarters NPV, $/Acre (64s) 8 $1,856 $3,716 $5,576 $7,436 $9,297 $11,157 $13,17 $14,877 $16,738 7 $638 $2,265 $3,893 $5,521 $7,148 $8,776 $1,44 $12,31 $13, $575 $815 $2,21 $3,65 $5, $6,395 $7,79 $9,186 $1, $2,23 -$883 $273 $1,438 $2,69 $3,785 $4,961 $6,136 $7, $3,187 -$2,32 -$1,396 -$477 $45 $1,383 $2,319 $3,259 $4,2 Sum of 2 Yrs of Cash Flow / Completed Well Cost 8.9x 1.1x 1.3x 1.5x 1.7x 1.9x 2.1x 2.3x 2.5x 7.8x 1.x 1.1x 1.3x 1.5x 1.6x 1.8x 2.x 2.1x 6.7x.8x 1.x 1.1x 1.3x 1.4x 1.5x 1.7x 1.8x 5.6x.7x.8x.9x 1.x 1.2x 1.3x 1.4x 1.5x 4.4x.5x.6x.7x.8x.9x 1.x 1.1x 1.2x YR 1 YR 2 YR 3 YR 4 YR 5 YR 6 YR 7 YR 8 YR 9 Decline Rate from 24 HR IP 81% 37% 37% 27% 18% 14% 1% 8% 8% Comparing our best case investment metrics with M&A deal values, CNOOC s acquisition of CHK s acreage in both the Powder River Basin and the D-J Basin looks like it was overly aggressive, as does CHK s acquisition of acreage from Samson Oil (albeit a much smaller deal), both seen in the table on the next page. CNOOC s near- $4,75/acre deal value closely corresponds to the NPV of a well drilled on 64-acre spacing, with a 7 boe/d, 24-hour IP rate at $9 oil, without even considering further deductions to NPV for lead times to full development of acquired acreage, geological or execution risk. CNOOC entered the play early, but could have paid up later, for better delineated acreage tracts. But we would note similarly aggressive investment decisions generally being made by other Asian buyers. ITOCHU Corp. acquired 22, net DJ acres from MDU Resources for an undisclosed price late in 21. Based on results to date, and without the advent of down-spacing that the industry thinks likely, CNOOC did not add value for shareholders in this deal, while CHK did. Sven Del Pozzo, CFA sven.delpozzo@ihsherold.com Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 8

9 Shale Transactions ANNC'D DATE BUYERS SELLERS 1-Mar-11 Recovery Wapiti Oil & Energy Gas 31-Jan-11 CNOOC Limited 26-Jan-11 Halliburton 3-Jun-1 Rex Energy Corp Total Transact. ACREAGE Net DEAL Value KEY VALUE Undevel. LEVEL US$MM CHARACTER US$MM Acreage US$/Acre Asset $12.3 Oil Shale $12.3 8,6 $1,526.5 Chesapeake Asset $1,267. Oil Shale $1, ,4 $4, , ,4 net acres in shale focused project Samson Oil Undiscl. private co. Undiscl. private co. Asset $9.2 Oil Shale $9.2 2,819 $3, % stake in farm-in area (2,819 net acres) Asset $18.7 Oil Shale $ ,7 $1, Shale acreage Undevel. Acreage Asset Value KEY ASSETS PRIMARY LOCATIONS U.S.-Rcky Mtns Denver-Julesburg (U.S.) Wyoming U.S.-Rcky Mtns Denver-Julesburg (U.S.) Laramie County (WY) Wyoming U.S.-Rcky Mtns PRIMARY BASINS Denver- Julesburg (U.S.) Denver- Julesburg (U.S.) DEAL TYPE WTI SPOT DAY PRIOR ANNC'D US$ NYMEX OIL 12 MO. STRIP DAY PRIOR ANNC'D US$ HENRY HUB GAS SPOT DAY PRIOR ANNC'D US$ NYMEX GAS 12 MO. STRIP DAY PRIOR ANNC'D US$ Acquis. $89.34 $ $4.29 $4.611 Farm In $85.14 $ $4.45 $4.691 Acquis. $75.94 $78.17 $4.68 $ Jun-1 Voyager Oil & Gas Slawson Exploration Asset $7.5 Oil Shale $7.5 24, $ % working interest in 48,-acre block Denver-Julesburg (U.S.) Weld County (CO) Colorado U.S.-Rcky Mtns Denver- Julesburg (U.S.) Acquis. $78.61 $ $4.84 $ Jun-1 Chesapeake Samson Oil & Gas Ltd 13-May-1 Gulfport Energy Undisclosed private 26-Feb-1 Chesapeake American O&G North Finn Asset $73.7 Oil Shale $ ,766 $3, ,766 acres in Goshen County Project Asset $7.8 Oil Shale $7.8 24,468 $ Shale assets Asset $49.4 Oil Shale $ , $ Fetter and Krejci projects Wyoming U.S.-Rcky Mtns Colorado U.S.- Rcky Mtns Powder River (U.S.) Wyoming U.S.-Rcky Mtns Powder River (U.S.) Acquis. $76.16 $ $4.9 $5.213 Acquis. $75.65 $ $4.17 $5.79 Acquis. $77.92 $8.19 $4.84 $5.363 Totals $1, ,213 $3,791.7 Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 9

10 CHK APC (KMG) APC (HWL) Rosewood EP EP bbl/d CHK APC (KMG) East Res. North Finn APC (HWL) bbl/d CHK APC (KMG) EAST Res. North Finn WLL APC (HWL) bbl/d First 6 Day Daily Avg. Oil Production All Horizontals Since '7 w/6 Days of History Outside of Silo 5 4 First 18 Days Average Oil Production Daily Average All Horizontals Since '7 w/18 Days History Outside of Silo First 365 Days Oil Production Daily Average All Horizontals Since '7 w/365 Days of History Outside of Silo Field Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 1

11 bbl/day online 4 Year Cumulative Production, bbl of Oil 35, 3, Silo Field-8 Horizontals - Early IP Rates Mean Little to Reserves 25, 2, 15, 1, 5, Monthly Average IP Rate, bbl of Oil 6 Daily Oil Production: Only a Handful of Outstanding Modern Oil Wells Mo. 3 Mo. 4 Mo. 5 Mo. 6 Mo. 7 Mo. 8 Mo. 9 Mo. 1 Mo. 11 Mo. 12 Mo. 13 Mo. 14 Mo. 15 Mo. 16 Mo. 17 Mo. Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 11

12 Cumulative boe 7, 6, Horiz. Wells-Cumulative BOE vs. % Oil 5, 4, 3, 2, 1, % 2% 4% 6% 8% 1% 12% % Oil The analyst that prepared this report has a long position in the securities of Stone Energy Corporation mentioned in this report. This analyst is contractually prohibited from purchasing or selling the securities of this company during the blackout period implemented by IHS Herold for this type of report. The research analysts who prepared this report certify that the views expressed herein accurately reflect their professional opinions, are consistent with established Herold methodologies and standards and that no part of their compensation was, is or will be directly or indirectly related to specific views contained in this report. Copyright 211 IHS Herold Inc. All rights reserved. Herold Regional Play Assessment is published by IHS Herold Inc., 2 Connecticut Avenue, Suite 3A, Norwalk, CT 6854, USA for the exclusive use of IHS Herold clients. Reproduction of this report, even for internal distribution, is strictly prohibited. The information contained herein has been obtained from sources believed to be reliable, but IHS Herold does not guarantee their accuracy or completeness. No information or opinions contained herein constitutes a representation or solicitation for the purchase of any securities of the companies mentioned herein. From time to time, IHS Herold and/or its officers and employees may have long or short positions in the securities mentioned herein or during the past year may have transacted in securities of the companies mentioned. Copyright 211 IHS Herold Inc. Herold Regional Play Assessment 12