Creating value through efficient deployment of capital

Celebrating our 10th year of operations in 2016, Coachman currently manages and/or operates conventional and unconventional assets located throughout North Dakota, Colorado, Kansas, and Nebraska.

Our end goal is to build a great asset through the efficient deployment of capital regardless of price cycle phase.

We believe the key to creating value in the oilfield is understanding how to minimize the effect of down price cycles while enabling the efficient deployment of capital into attractive projects regardless of cycle phase. As such, Coachman follows a Hybrid Development Strategy (HDS) that allows us to proactively adjust our acquisition focus to take advantage of whatever market we find ourselves in.

How to profit from the Bakken oil boom?

Central to HDS is combining non-operated ownership positions in the “sweet spots” of big unconventional resource plays (BRP) with operated interests in smaller, Coachman-operated conventional plays (COP). Owning a combination of BRP and COP prospects that possess varying breakeven price points and different risk/reward characteristics helps enable Coachman to shift capital allocation between projects at any time based on price cycle phase. The continued, uninterrupted deployment of capital is the foundation for return potential even if prices remain depressed for an extended period of time.

HDS in Action – Allocating capital where it makes most sense… today

Big resource plays are highly consistent and highly predictable. Thus, while they may have a higher breakeven point than the typical conventional play, they possess the ability to deliver value gains through the development of proved resources in relatively short periods of time through the drill bit.

When oil prices are high, allocating a significant portion of capital to BRPs is the most powerful method of building value due to the BRP’s ability to rapidly increase proved reserve values and potentially boost returns per dollar of investing.

Conversely, when oil prices dip, capital is more heavily allocated into Coachman operated prospects (COPs) due to their lower breakeven point. Shallow wells can be drilled and completed in days, not weeks, with no or minimal frac’ing required. As a result, wells are relatively inexpensive to drill compared to BRPs and production and cash flows can occur more quickly.

In 1Q2016 Coachman completed a significant conventional, Coachman-operated acquisition in the Mid-Continent region, encompassing roughly 160,000 net mineral acres and ~400 barrels of oil per day in existing production.