State of the IndustryBen Broussard

Director of MarketingLouisiana Oil & Gas Association

Global MarketIndustry in LouisianaState

Government

Renew

able

Refinery

Gain

s

Natural

Gas

Liquids

Crude Oil

0 3 5 8 10

1.1

1.1

3.3

9.3

Million Barrels

What Makes Up U.S. Supply?

USCHIN

A

EUROPE

S. AMERIC

A

REST OF W

ORLD0

12.5

25

37.5

50

19

1115

7

42

Category Axis

Mill

ion

Bar

rels

/ D

ayWorld Demand 94 Million

Barrels Per Day

Breakeven Price for OPEC & Russia

Qatar

Kuwait

Ango

la UAE

Saud

ia Ar... Ira

q

Venezu

elaLib

yaAlge

riaNige

ria

Ecuad

or Iran

Russia

$0

$35

$70

$105

$140

$175

$60$70

$95 $98 $98

$120$112 $116

$124 $124 $121$140

$104

OPEC Production 38 Million bpd $31 barrel $1.2 Billion/d

OPEC Production 36 Million bpd $70 barrel $2.5 Billion/d

Cut 2 Million bpd

Saudis Economics Doesn’t Make Sense

2/1/70

6/1/71

10/1/

722/1

/746/1

/75

10/1/

762/1

/786/1

/79

10/1/

802/1

/826/1

/83

10/1/

842/1

/866/1

/87

10/1/

882/1

/906/1

/91

10/1/

922/1

/946/1

/95

10/1/

962/1

/986/1

/99

10/1/

002/1

/026/1

/03

10/1/

042/1

/066/1

/07

10/1/

082/1

/106/1

/11

10/1/

122/1

/146/1

/15$0

$40

$80

$120

$160

We Have Been Here BeforeCrude Oil Annual Average Price 1970-2015 (Adjusted for Inflation)

OilEmbargo

IranianRevolution

Crash of 86

Iraq Invaded Kuwait

Southeast AsiaEconomic Downturn

Invasionof Iraq

Peak Oil Mania

Saudis War forMarket Share

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Current

27 23 23 2838

5058

64

147

54

70

98 99 96

82

35 384 4

3

56

9

76

13

4 43 3 3

4

1.91.71

Oil & Gas PricesNo Longer Dependent on Each Other

OilNatural Gas

1949

1950

1951

1952

1953

1954

1955

1956

1957

1958

1959

1960

1961

1962

1963

1964

1965

1966

1967

1968

1969

1970

1971

1972

1973

1974

1975

1976

1977

1978

1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Today

489

1862

1980

964

Annual U.S. Average Rig Count1949 - 2015

Louisiana Average Rigs1968 - 2016

68

69

70

71

72

73

74

75

76

77

78

79

80

81

82

83

84

85

86

87

88

89

90

91

92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

10

11

12

13

14

15

Feb

0

125

250

375

500

625 487

12688

192

46

Lowest month ever recorded

9/1992 76 rigs

Louisiana Rig CountSept 1992

(Lowest Recorded Week) Current

North La 10 17

South La Land 22 5

Inland Water 9 2

Offshore 35 22

TOTAL 76 46Baker Hughes

Monthly Louisiana Permits

2007 - 2014High

402Record Low

30Jan 2016

Average

142

Job Losses are REAL• 2500 jobs lost in Acadiana alone in 2015

•Estimated that another 4,000 will be lost in 2016

• 10,000 jobs lost in Louisiana

• 60,000 jobs lost in Texas

• 250,000 jobs lost in U.S.

Governor

John Bel Edwards

Richard Ieyoub

Commissioner of Conservation

Thomas HarrisSec. Department of Natural Resources

Taylor Barras

House SpeakerJohn Alario

Senate President

State Budget in Turmoil

FY 2016July 1, 2015 - June 30, 2016

FY 2017July 1, 2016 - June 30, 2017

$940 Million$2.0 Billion*

SPECIAL SESSION: FINAL RESULTS

HB 62: Adds one clean penny to the existing 4 cent state sales tax-No exemptions apply to that new penny-Lasts until 2018; LOGA fought for sunset*Cant be renewed; Legis would require new

legislation

HB 61: Cleans exemptions from the four existing pennies•Until June 30th, 2016: Exemptions gone.•After June 30th: .02 exemptions apply until 2018

Legal Climate Continues to Plague Industry

• Cameron Parish Files 11 Suites against 113 Companies and 195 defendants

• Jefferson Parish suits remain

• Nearly 400 plus Legacy Lawsuits

It hasn't been all bad

Plaquemines Parish Coastal lawsuits tossed out

Supreme Court victory in the Hayes Fund Case

Ban of oil exports lifted by Congress

Don Briggs

The Price of Oil Will Go UP

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