Southwestern Energy — Investor Presentation (March 2023)
56 slides from Southwestern Energy's investor presentation, Mar 9, 2023
Slide 1: 2023 Company Outlook and Investor Presentation
Ey" SWI Southwestern Energy’ 2023 Company Outlook and Investor Presentation March 9, 2023
Slide 2: Cautionary Statements
Cautionary Statements SW/N Investor Relations Contacts Brittany Raiford 832.796.7906 Aaron Henslin 832.796.2838 southwestern Energy Forward-Looking Statements ‘This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securties Actof 1933, as amended, and Secti
Slide 3: Additional Information
Additional Information SWN southwestern Energy Cautionary Note to U.S. Investors ‘The SEC permts oil and gas companies, in their fings with the SEC, to disclose only proved, probable and possible reserves. We use the terms “resource” and“EUR" inthis presentation that the SECs guidelines prohibit us
Slide 4: Strategic Positioning
Strategic Positioning
Slide 5: Shareholder Value Proposition
Shareholder Value Proposition SWN aie UN southwestern Energy Constructive Long-term Macro Outlook 15 Years of Core Inventory in Two Premier Natural Gas Basins Proactively Responding to Lower Prices to Prioritize Free Cash Flow Enterprise Focus to Continue to Improve Capital Efficiency Lowered Enterp
Slide 6: Our Strategy
Our Strategy CREATE SUSTAINABLE VALUE SWI southwestern Energy Enhance corporate and shareholder economic returns Deliver sustainable free cash flow Deepen and upgrade the quality and capital efficiency of asset base and inventory Convert resources to reserves PROTECT FINANCIAL STRENGTH Target sustai
Slide 7: Company Transformation — Positioned for the Future
Company Transformation — Positioned for the Future SW/N soutwestan Enorayt Net Production (Bcfe/d) Core Inventory Free Cash Flow (SMM) cn eae depth by more than00 locations Generatingfreecash flow a7 2,050 soe 24 1.100 a LI (s237) 2020 2022 2020 2022 2020 2022 LNG Sales (Bcf/d) Gulf Coast Transporta
Slide 8: Largest Dual Basin Natural Gas Producer
Largest Dual Basin Natural Gas Producer sSWwN southwestern Energy Natural Gas Peer 2023E Net Production (Bcfe/d)?") ~ Appalachia 80% 20% @ Companies with multi-basin assets Net Acres:766,000 Gas Liquids 2023E Net Production: ~2.8 Befelday" 53 46 8 33 a1, 12 G Y Peer1 SWN Peer2 Peer3 Peer 4 Peer5 Pee
Slide 9: Portfolio Optionality Across Deep High Return Inventory
Portfolio Optionality Across Deep High Return Inventory swn southwestern Energy | Basin —J Commodity Liquids 13% Haynesville 40%, 4.6 Bcfeld net production" 4.6 Bcfe/d core inventory net production Gas 87% ‘Appalachia 60% Premium Sales Locations 4, , Other 3%, Ctrycate 6% ~113. gas sold to LNG marke
Slide 10: Today's Agenda
Today’s Agenda SW/N southwestern Energy * Operational update — Clay Carrell / Andy Huggins - Depth of quality inventory across both core assets - 2023 development program - Haynesville update and future value optimization - Marketing optionality and flow assurance + Marketing update — David Talley -
Slide 11: Operational Update
Operational Update
Slide 12: Deep Core Inventory Set Across Both Assets
Deep Core Inventory Set Across Both Assets sSWwN southwestern Energy Total Company Inventory Appalachia Inventory Detail Only 630 locations 2,050 core locations other _ included in $268, represents more than, Marcos PV-10 value" 15 years of ste development ~4,800 total us arcctus | locations ‘370 6,
Slide 13: Proactively Managing Through Commodity Volatility
Proactively Managing Through Commodity Volatility swn southwestern Energy Average Rigs") + Proactive response to gas pullback a 2 - Capital plan reflects moderated activity 40-11 pears with expected 2-3% production decline a | + ~2 fewer rigs, ~0.5 fewer frac fleets + Greater liquids-directed activi
Slide 14: Appalachia — Core Dry Gas and Liquids Position
Appalachia — Core Dry Gas and Liquids Position Operational Plan‘ 2023E Rigs 3 Frac fleets 2 Wells drilled 53-58 % Marcellus liquids rich 65% Wells completed 64-69 % Marcellus liquids rich 65% Wells to sales 68-73 ‘% Marcellus liquids rich 65% Average lateral length >15,500 Base decline <25% D&C capi
Slide 15: Appalachia Operating Areas
Appalachia Operating Areas SWN southwestern Energy y 73 West Virginia Inventory:225 Marcelus Super Rich 1110 Marcellus Rich | 695 Marcellus Dry | 4,075 Utica Dry Gas| 1,050 Upper Devonian 2023 Program: Op WITNRE ~79%6| ~66% Wels to sales:~40 (Super Rich / Rich) ‘Avg. CLAT: ~15,000" D&C Cost: $930 -
Slide 16: Highest Yield Liquids-rich Acreage in Appalachia
Highest Yield Liquids-rich Acreage in Appalachia Marcellus NGL Yield (Bbl/Mmcf) SWI southwestern Energy Marcellus Condensate Yield (Bbl/Mmcf) Im SWN acreage — 50 ‘Tuscarayas 5 Ueterson ‘iithon “Ohio Pennsylvania Greene ash Taylor > West Virginia mm SWN acreage = | aS Beaver, 120+ 0 ‘or Tuscan Bee’,
Slide 17: Haynesville — Core Stacked Pay Position
Haynesville — Core Stacked Pay Position Operati 2023E Rigs 7-8 Frac fleets 2-3 Wells drilled 60-65 % Haynesville / Middle Bossier 50% / 50% Wells completed 64-69 % Haynesville / Middle Bossier 50% /50% Wells to sales 70-75 % Haynesville / Middle Bossier 50% / 50% Average lateral length ~8,500 Base d
Slide 18: Successful Haynesville Integration and Early Wins
Successful Haynesville Integration and Early Wins SWN southwestern Energy * Technical achievements Improved well performance driven by flowback and completion optimization initiatives Best-in-basin well performance = Only operator of scale with production performance improvements!" Leveraged organiz
Slide 19: Haynesville Operating Areas
Haynesville Operating Areas Claiborne Lincoln Jackson SW)N southwestern Energy North Haynesville Inventory: 190 HNSV | 225 MB EURs: 1.8—2.2 Befi1,000" 2023 Program: ‘Op WI NRI: ~92% |~719% Wellsto sales: ~20 ‘Avg. CLAT: ~8,750' D&C Cost $1,775-$1,975it Desoto East Inventory: 195 HNSV | 155 MB EURs:
Slide 20: Core Stacked Haynesville and Middle Bossier Opportunity
Core Stacked Haynesville and Middle Bossier Opportunity sw) southwestern Energy 2022 Wells to Sales Desoto East Well Performance (Mcfift)) li SWN acreage 2 Haynesiile 21 Haynesiile SS haynesviie Core 22 iNae Bossier 21 niaae Bossier Nofth | hice Bossiercore Haynesville —= $001 2022 weistosaies j=, B
Slide 21: SWN Delivers Leading Well Performance
SWN Delivers Leading Well Performance SWN southwestern Energy Operator Well Performance (Mcfift)”) 2019 — 2022 Wells to Sales ww 2019 = 2020 m 2021 mi 2022 SWN consistently improving well performance Pesrl Peer2 Peer3 Peer Peer S Rak 6 to Cumulative Gas (Mef/1t) Type Curve Area Well Performance (all
Slide 22: Haynesville Operational Improvements
Haynesville Operational Improvements SWN ‘Southwestern Energy" Drilling Footage Per Day (ftiday)"”) Drilling Days on Location (days)\") “ 10%+ ° 10%+ oo ies ts wee 200 6 200 Pa 100 15 7 2021 2022 7 2021 2022 Average Drilled Lateral Length (ft) Completed Footage Per Day (lateral ftiday)(") 72000 fein
Slide 23: Haynesville Development Efficiencies
Haynesville Development Efficiencies sSWwN southwestern Energy Drilling (50 - 55% of total well costs) Focusedon controllable costareas + 85% of drilling costs are driven by durations ~ Targeting 2023 efficiency gains inline with 2022 of $50— $70m Further anticipated gains driven by + Improvedtechno
Slide 24: Superior Access to Premium Gulf Coast Markets
Superior Access to Premium Gulf Coast Markets SWN Gulf Coast Transportation Portfolio IG Con 2023E 2024E LEAP @ 4.2Belld 4.8 Belld Momentum NG3 - o3Betid Acadian 0.2Batid 0.2Betid Midcoast 0.2Betid 0.1 Beta Other ® 0.2Batid 0.2 Batid LNG Corridor ~1.8 Befld ~23 Befld Greater Gulf Coast Ne condor Gui
Slide 25: Marketing Update
Marketing Update
Slide 26: Global Gas Pricing Dynamics
Global Gas Pricing Dynamics U.S. and Global Natural Gas Prices 2007 — Current 19 Befld unutilized U.S. LNG import capacity by end of 2000's n Ramp in U.S. LNG exports driven by uunutilized import capacity, shale production, Fukushima earthquake, and Qatar limiting LNG growth Global and US oversupply
Slide 27: U.S. Positioned to Balance Global Gas Markets
U.S. Positioned to Balance Global Gas Markets SWN southwestern Energy + More than 20 Bcfid global LNG Global LNG Supply and Demand demand growth expected through Growth From 2022 to 2030°) 2030 25 US best positioned - Driven by Asia and Europe to help fill supply gap + U.S. best positioned to balanc
Slide 28: U.S. Projects In Progress to Fill Growing LNG Demand
U.S. Projects In Progress to Fill Growing LNG Demand swn southwestern Energy LNG exports projected to furtherincrease demand + Current 13 Bcf/d of capacity is currently in-service + Projected increase of 6 Bcfid for projects under construction; over 20 Bcfld of permitted next wave projects LNG provi
Slide 29: Haynesville Advantaged to Supply Gas to LNG
Haynesville Advantaged to Supply Gas to LNG SW/N Southwestern Energu* + Haynesville is the best positioned U.S. natural gas supply basin for LNG - Deep, proven resource base - Proximity to operational and planned export capacity growth - Supportive business environment - Developed infrastructure net
Slide 30: SWN LNG Supply Competitive Advantages
SWN LNG Supply Competitive Advantages SWN Advantaged Access to the LNG Corridor ‘southwestern Energy SWN Deliverability to Gulf Coast / LNG Corridor + Large-scale producer with ~3.4 Befid current Gulf : } Coast natural gas sales from Appalachia and —\ Haynesville basins ~0.7 Befid Appalachia access
Slide 31: Illustrative Global LNG Pricing Structure
Illustrative Global LNG Pricing Structure swn southwestern Energy + Recent strong performance of global-priced netbacks; relation between global and Henry Hub pricing can change materially over time + International netbacks are economically advantaged at current global gas price differentials and wo
Slide 32: LNG Process and Focus Areas
LNG Process and Focus Areas SWN southwestern Energy? TTF / JKM price Increase LNG exposure to up to 2.0 Befid Decision on international pricing exposure + Continue and + Risk adjusted ¥ Seta and + If pre-FID optimize 1.5 Bet/d review of See amore agreement, await $4 basetoasine =} international hehe
Slide 33: LNG Strategy Objectives
LNG Strategy Objectives SWN CAPTURE BENEFITS of PORTFOLIO DIVERSIFICATION southwestern Energy Dual-basin sourced gas supply benefits from supportive long-term natural gas fundamentals Diversify overall gas sales portfolio by contracting at multiple indices MAINTAIN and GROW Firm transportation to Gu
Slide 34: Intermediate Term Outlook
Intermediate Term Outlook
Slide 35: Pathway to Strategic Objectives
Pathway to Strategic Objectives Area Activity Capital Allocation Operations Flow Assurance LNG Hedging MaA thway Maintain production to progress free cash flow, economic returns and enterprise value on multi-year basis Prioritize debt repayment: $3.56 — $3.0B target range Complement with share repur
Slide 36: Durable Financial Strength
Durable Financial Strength SW/N southwestern Energy? Key Financial Objectives Approaching Investment Grade Ratings + Reduce debtto target range of $3.5— $3.0 ‘Agency CurrentRating Outlook | NotchestolG Ratings Date billion; maintain 1.5x — 1.0x leverage SEP co Positive 1 Jan 23 Moody's Bat Stable 1
Slide 37: Free Cash Flow Outlook
Free Cash Flow Outlook SWN ‘Southwestern Energy" 5 Year Cumulative FCF ('23 —'27) ($MM) FCF Sources and Uses (’23 -'27) ($MM) $9,000 $9,000 mStrip? m$4Gas = $5 Gas $8,000 $8,000 $7,000 ‘$7,000 ‘$6,000 $6,000 $5,000 $5,000 ‘$4,000 $4,000 $3,000 $3,000 $2,000 $2,000 $1,000 $1,000 $0 $0 |_| Strip? ‘$4
Slide 38: Shareholder Value Proposition
Shareholder Value Proposition SWN SS eee A southwestern Energy Constructive Long-term Macro Outlook Near-term supply response will only strengthen long-term outlook 15 Years of Core Inventory in Two Premier Natural Gas Basins Complementary inventory set across both Appalachia and Haynesville and com
Slide 39: Appendix
Slide 40: 2023 Guidance
2023 Guidance SW/N bevtla fh As of February 23, 2023 — PRODUCTION ai TOTAL YEAR ey) waa remesiad (Ee ca n35% aa Total Bc) 36a ast 17% CAPITAL (in millions) Fopaacha ame fyi ae ‘Total D&C capital (includes land) $1,970 - $2,230 ‘ee $00 850 a 200220 ‘Total capital investments ‘$2,200 - $2,500 PRICING
Slide 41: Responsibly Sourced Gas to Premium Markets
Responsibly Sourced Gas to Premium Markets 2023E Differential to NYMEX Average Differential Year perMef ‘Appalachia ($0.42) (60.40) (0.82) Haynesville ($0.04) ($0.31) ($0.35) TotalCompany ($0.24) ($0.36) ($0.60) 2023E Sales Point Exposure Appalachia Out of Basin NYMEX 54% NYMEX [Gulf Coast 28% Perry
Slide 42: Well Positioned to Supply Growing Natural Gas Demand
Well Positioned to Supply Growing Natural Gas Demand swn LNG exports projected to further increase demand Current 13 Befid of capacity is currently in-service Projected increase of ~6 Bcf/d for projects under construction; over 20 Bcfid of permitted next wave projects LNG provides US producers the o
Slide 43: Advantaged to Reliably Supply Expanding LNG Corridor
Advantaged to Reliably Supply Expanding LNG Corridor swn southwestern Energy Cove Point SWN’s differentiated positioning to supply growing LNG demand a @ Proximity and access — largest Haynesville producer with firm transport to LNG corridor @ Scale — >3 Befid gross gas currently sold in Gulf Coast
Slide 44: FERC Approved LNG Projects Awaiting FID
FERC Approved LNG Projects Awaiting FID >20 Bef/d of Potential Next Wave Projects SWI southwestern Energy Location FERC-Approved Capacity (Bcfid) Cameron T4/T5 Hackberry, LA 14 Freeport T4 Freeport, TX o7 Magnolia LNG Lake Charles, LA 12 Port Arthur LNG Port Arthur, TX 19 Gulf LNG Pascagoula, MS 15
Slide 45: TTF (Europe) vs Henry Hub (US)
TTF (Europe) vs Henry Hub (US) SWN Forward netbacks $5-$10 for US-sourced LNG sold in Europe Southwestern Energy" U.S. and European Gas Prices‘) $80 $70 $60 $50 $/Mmbtu $40 $30 $20 $10 Htarntiti i min ($10) H 2016 =«2017,-—S «2018 »=— 2019 2020» 2021 «2022 2028S 2024 «= 2025-2028 mmm TTF Netback —US
Slide 46: U.S. LNG / Gas Value Chain
U.S. LNG / Gas Value Chain SWN southwestern Energy Gathering Processing Pipeline Transportation _LNG Liquefaction Large Independents Value Chain Players (Integrated) Pure Midstream Operators LNG Developers U.S. LNG value chain is becoming disaggregated providing opportunities for independent E&Ps to
Slide 47: Global LNG Value Chain
Global LNG Value Chain SWI southwestern Energy Liquifaction Plant S g LNG Import Terminal d ~2 BCFid ~9,600 MW + B $2+ Billion $10+ Billion rs to b 3-5+ years to build 2-3+ years to build ~ > Large scale, long lead time projects take significant time from FID to in-service and involve a large array
Slide 48: Our Approach to ESG
Our Approach to ESG SW/N @ ) Ay) SUSTAINABLE SOCIAL MINIMIZING VALUE RESPONSIBILITY CARBON FOOTPRINT Creating sustainable value requires meaningful and Protecting the health and safety of our workforce, Sustainable and responsible natural gas lmpacttul actions that consider our stakeholders ‘recogni
Slide 49: ESG is a Core Value
ESG is a Core Value SW)N poral HY ENVIRONMENTAL GOVERNANCE AIR WATER 44%* jj 80% Scope 182 15.7B Sout nebo a ce Uy) 5020 LS oeceou coer eel ers oar eee eae: ‘setin 2022 Responsibilty Report $98 66% 6th of board members have iy) 26% 1 100% a eh cer eae Senn at israeyaroncen CA cimmemmeenniom | fein s
Slide 50: Haynesville Core Acreage — Haynesville
Haynesville Core Acreage — Haynesville sSWwN southwestern Energy? Haynesville Well Activity Haynesville Well Performance Densely drilled| SWN Acreage == Haynesvile Core EUR (Bofit,000" 7-22 Bcf 2-27 Bcf 72 8ct —Haynesvile wells SVN Acreage ==+ Haynesvile Core ‘Source: Enverus public data for wells t
Slide 51: Haynesville Core Acreage — Middle Bossier
Haynesville Core Acreage — Middle Bossier Middle Bossier Well Activity SWI southwestern Middle Bossier Well Performance” Energy" — Middle Bossier wels SWN Acreage 22 Bcf 2-27 Bcf m2 7+ Bet SW Acreage ==" Middle Bossier Core EUR (Bofit,000" ‘Source: Enverus public data for wells to sales prior to 202
Slide 52: Haynesville Resource and Deliverability
Haynesville Resource and Deliverability sSWwN southwestern Energy Hydrocarbon Pore Volume (V/V) Reservoir Pressure (Psi) we Harrison, Rusk MMISWN acreage MISWN acreage 00 053+ 5,000 10,000+ = a | | haracteristics driving enhanced economics across 1 1 acreage position
Slide 53: Explanation and Reconciliation of Non-GAAP Financial Measures: Net Cash Flow and Free Cash Flow
Explanation and Reconciliation of Non-GAAP SW/N Financial Measures: Net Cash Flow and Free Cash Flow ia Net cash flow is defined as cash flow from operating activities adjusted for changes in operating assets and liabilities, merger- related expenses and restructuring charges. The Company presents t
Slide 54: Explanation and Reconciliation of Non-GAAP Financial Measures: Adjusted EBITDA
Explanation and Reconciliation of Non-GAAP SW/N Financial Measures: Adjusted EBITDA ea EBITDA is defined as net income (loss) plus interest, income tax expense, depreciation, depletion and amortization. Adjusted EBITDA is defined as EBITDA less gains (losses) on sale of assets, gain on early extingu
Slide 55: Explanation and Reconciliation of Non-GAAP Financial Measures: Net debt / Adj. EBITDA
Explanation and Reconciliation of Non-GAAP SWN Financial Measures: Net debt / Adj. EBITDA oe Net debt is defined as short-term debt plus long-term debt, less cash and cash equivalents. Adjusted EBITDA is defined as net income (loss) plus interest, income tax expense, depreciation, depletion and amor
Slide 56: Explanation and Reconciliation of Non-GAAP Financial Measures: Pre-tax PV-10
Explanation and Reconciliation of Non-GAAP SW/N Financial Measures: Pre-tax PV-10 ea Another such non-GAAP financial measure is pre-tax PV-10. Management believes that the presentation of PV-10 is relevant and useful to our investors as supplemental disclosure to the standardized measure of discount
Southwestern Energy — Investor Presentation (March 2023) on 6ix