Extraction Oil & Gas — Merger or Acquisition (September 2021)
30 slides from Extraction Oil & Gas's merger presentation, Sep 28, 2021
Slide 1: Corporate Presentation September 28, 2021
Corporate Presentation September 28, 2021
Slide 2: Important Disclosures
Important Disclosures 1 No Offer or Solicitation This communication relates to proposed business combination transactions between Bonanza Creek Energy, Inc. (“BCEI”) and Extraction Oil & Gas, Inc. (“XOG”) (the “XOG Merger”) and between BCEI, Crestone Peak Resources LP (“CPR”), CPPIB Crestone Peak Re
Slide 3: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements 2 Forward-Looking Statements and Cautionary Statements Certain statements in this document concerning the Mergers, including any statements regarding the combined company's expected credit facility, the expected timetable for completing the M
Slide 4: Senior Management
Senior Management Marianella Foschi, CFO 3 Eric Greager, President and CEO • Mr. Greager joined BCEI’s board and was named President & CEO effective April 11, 2018 • Previously, Mr. Greager worked at Encana from 2006 to April 2018 and served in various management and executive positions, including a
Slide 5: Civitas – DJ Pure Play, Built to Be Uniquely Disciplined
Civitas – DJ Pure Play, Built to Be Uniquely Disciplined 4 • After the closing of multiple strategic combinations in the DJ Basin, Civitas will be uniquely positioned amongst E&P peers with class leading resource quality, low cost structure, free cash flow generation and minimal leverage to deliver
Slide 6: Civitas Will Result from Strategic DJ Consolidation
5/10/21: BCEI and XOG announce merger of equals Capital Structure Impacts from XOG: $94MM of credit facility borrowings (and $38MM in cash)(1) Civitas Will Result from Strategic DJ Consolidation 5 + = + + November 2020 April 2021 May 2021 June 2021 Fall 2021 11/9/20: BCEI announces combination with
Slide 7: Transformative DJ Basin Consolidation
Transformative DJ Basin Consolidation 6 Expanded Merger of Peers Leadership & Governance Approvals & Timing Current DJ Basin Operations • All-stock transactions • Pro forma company ownership: 37% BCEI, 37% XOG and 26% CPR stakeholders • Pro forma enterprise value ~$4.3Bn(1) • Ben Dell – Chair of the
Slide 8: Pro Forma Capital Structure Overview
($ in millions) Pro Forma Capitalization PF as of 6/30/21 Cash and Cash Equivalents $79 Revolving Credit Facility (Expected)($1bn BB; $800MM ECA)(1) 444 Total First Lien Debt $444 BCEI Legacy Senior Unsecured Notes due 2026 100 Total Debt(2) $544 Financial Statistics PDP PV-10(3) $3,939 Pro Forma 1H
Slide 9: Pro Forma Civitas Organizational Structure
Pro Forma Civitas Organizational Structure 8 Civitas Resources (NYSE: CIVI) Guarantor Subsidiaries $100MM BCEI Legacy Senior Unsecured Notes $800MM RBL Revolver(2) ($444MM Drawn(3)) Bonanza Creek Energy (NYSE: BCEI) Extraction Oil & Gas (NASDAQ: XOG) Crestone Peak Resources (“CPR”) 37% CIVI Ownershi
Slide 10: Expected Civitas Governance Structure
Expected Civitas Governance Structure Experience Technical -- -- -- Financial -- -- -- -- -- Colorado -- -- -- -- -- Industry Diversity -- -- -- -- -- -- -- Ben Dell Chair of the Board Morris Clark Chair, Audit Committee Carrie Fox Howard Willard Chair, Comp. Committee • Board brings together divers
Slide 11: Civitas Overview
Civitas Overview
Slide 12: High Quality Asset Base
High Quality Asset Base Ability to maintain production with ~50% reinvestment Delivering on the New E&P Business Model Front End of Cost Curve ~$4.00 / Boe 2Q21 LOE + Cash G&A(1) Fortress Balance Sheet ~0.3x Pro Forma Net Debt / Pro Forma 1H’21 annualized Adjusted EBITDAX(2), target of ~0.5x through
Slide 13: Key Civitas Strengths and Priorities
Key Civitas Strengths and Priorities 12 Leading Cost Structure + Scale + Top Tier Resource Fortress Balance Sheet ESG Leadership Stable, Long-Term Cash Flow Profile Disciplined Capital Program • Distinctive competencies in operations, consolidation, sustainability and regulation • Highly energized m
Slide 14: Preeminent Pure-play DJ Basin Operator
Net DJ Basin Acres PDP PV10(3) 1H’21 PF Annualized Adj. EBITDAX(2) 1H’21 PF Production Enterprise Value(1) Expected Annual Synergies Gross Locations(4) Preeminent Pure-play DJ Basin Operator 13 (1) Based on the equity pro forma capitalization of BCEI as of September 22, 2021. Combined balance sheet
Slide 15: Integration Synergies
Integration Synergies 14 • Field optimization ; Lease operations Remote monitoring • Purchasing power LOE Millions $ / Year • Basin-wide optimization opportunities across supply agreements and volume and drilling commitments Midstream Millions to Tens of Millions $ / Year One-Time • Sale of duplicat
Slide 16: Intense Focus on Cost Structure
~$4.00 $3.95 $5.91 $6.35 $6.48 $6.97 $7.33 $7.37 $7.99 $8.50 $10.08 0.0 3.0 6.0 9.0 12.0 CIVI Peer A Peer B Peer C Peer D Peer E Peer F Peer G Peer H Peer I Peer J Intense Focus on Cost Structure 15 2Q21 LOE + Cash G&A ($/Boe) Median: $7.15 (1) Source: Company disclosures. Note: Peers include BRY, C
Slide 17: Civitas' Disciplined Approach to Further DJ Consolidation
Civitas’ Disciplined Approach to Further DJ Consolidation 16 •Civitas will continue to be a disciplined transaction partner – Disciplined transaction partner with a focus on value creation and accretion – Opportunity to increase efficiencies with economies of scale – Operating expertise across the b
Slide 18: Operations Overview
Operations Overview
Slide 19: DJ Basin Flexibility
DJ Basin Flexibility Development Area Approximate DJ Basin Net Acres(1) Geography Western 135,000 Suburban / Rural Eastern 115,000 Rural Southern 125,000 Suburban / Rural Northern 150,000 Rural 18 Combined Position Will Facilitate Asset Development Optimization Denver Jefferson Adams Arapahoe Elbert
Slide 20: Relative Inventory Contribution by Area
Relative Inventory Contribution by Area 19 Note: Single well economics valued at flat $55 WTI / $2.75 HH / 40% NGL differential. Average lateral length of ~9,700’. (1) Inventory as of August 31, 2021. Includes Northern locations. (2) OA is Operator Agreement. B-TAX Single Well IRRs at $55 WTI 0% 10%
Slide 21: Colorado's Regulatory Framework
Colorado’s Regulatory Framework 20 •Mission Change Rulemaking effective January 2021 •New process streamlines permitting life-cycle •Coordination between State and Local permitting •Oil & Gas Development Plan addresses spacing and siting •Subsurface permitting is the last step •Focused on community
Slide 22: Midstream Assets Overview
Midstream Assets Overview 21 315 MMcf/d of gas gathering capacity 280 miles of gas gathering, gas-lift, and sales lines 26 pipeline interconnects to 5 midstream gas processors 22 centralized compressor sites, 67,000 total centralized hp Civitas Infrastructure Gas Oil H 20 Bronco • Total book value o
Slide 23: ESG Initiatives
ESG Initiatives
Slide 24: Sustainability Leadership in Action
15.9 13.9 10.6 5.7 2017 2018 2019 2020 5.2 11.6 13.4 14.7 15.8 18.9 22.1 24.2 25.4 26.2 26.3 XOG CIVI CPR Peer 6 Peer 5 Peer 4 HPR Peer 3 BCEI Peer 2 Peer 1 Sustainability Leadership in Action • High-grade emissions practices • Electrification of operations • Tankless development • Retrofit legacy f
Slide 25: Colorado's First Carbon Neutral Operator
• Colorado’s First Carbon Neutral Operator – Aggressive operational emissions-reduction program coupled with a multi-year investment in certified emissions offsets • Project Canary & Payne Institute Partnership – Partnership providing certified, third-party real-time air monitoring – Forward-thinkin
Slide 26: Appendix
Appendix
Slide 27: Consolidated Proved Developed Reserves Summary
Consolidated Proved Developed Reserves Summary 26 (1) Based on independent year-end reports and a July 1, 2021 effective date. (2) 9/17 NYMEX Price deck: WTI: $72.16, $67.80, $62.27, $58.14, and $55.08 (2021, 2022, 2023, 2024, and 2025+). HH: $4.56, $4.05, $3.25, $2.94, and $2.91 (2021, 2022, 2023,
Slide 28: Hedge Positions Enhance Financial Strength
$2.83 $2.83 $2.51 $2.57 $2.25 - $2.52 $2.57 - $3.63 $2.00 - $3.25 $2.13 $2.13 $2.15 - $2.75 $2.15 - $2.75 208,785 145,148 45,784 22,309 – – 50,000 100,000 150,000 200,000 250,000 4Q21 2022 2023 2024 2025 NYMEX Gas Swaps NYMEX Gas Collars CIG Gas Swaps CIG Gas Collars $51.39 $43.97 $43.85 $44.98 $44.
Slide 29: Reconciliation for Adjusted EBITDAX
Reconciliation for Adjusted EBITDAX 28 Source: Company disclosure. Net income (loss) $ 677,270 Exploration Depreciation, depletion, and amortization Abandonment and impairment of unproved properties Unused commitments Stock-based compensation Non-recurring general and administrative expense Other op
Slide 30: Reconciliation for Net Debt
Reconciliation for Net Debt 29 Source: Company disclosure. Senior notes $ 100,000 Credit facility Cash and cash equivalents Net debt $ 465,145 As of June 30, 2021 Pro Forma Civitas 444,000 (78,855)
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