Coterra Energy Inc., First Quarter 2023 Results

First-Quarter 2023 Shareholder Return Highlights

Jorden noted, "Based on first quarter results, Coterra will return $420 million to shareholders, which equals 76% of the company's Free Cash Flow. The return will include $152 million from our recently increased base dividend ($0.20 per quarter, $0.80 annum) and $268 million via share buybacks. We reiterate our commitment to return 50%+ of Free Cash Flow to shareholders, with an emphasis on the base dividend and buybacks, in the near-term."

• On May 3, 2023, Coterra's Board of Directors (the "Board") approved a quarterly base dividend of $0.20 per share, which will be paid on June 9, 2023 to holders of record on May 26, 2023.
• During the quarter, the Company repurchased 11 million shares for $268 million, averaging $24.36 per share and leaving $1,732 million remaining on the $2.0 billion share repurchase authorization as of March 31, 2023.

Guidance Update and Activity Outlook:

2023 cash flow guidance updates include:

• Estimate full-year 2023 Discretionary Cash Flow of approximately $3.6 billion, at recent strip prices
• 2023 capital budget remains unchanged at $2.0-2.2 billion (accrued); see potential for 2H23 deflation
• Estimate 2023 Free Cash Flow of approximately $1.6 billion at recent strip prices
• 2023 oil production range increasing by 1.0 MBopd, to 87.0-93.0 MBopd

2023 cash unit cost mid-point remains unchanged at $7.35-$9.55/Boe, with a few updates listed below:

• LOE updated to $1.75-$2.25/Boe, with the high-end of the range up by $0.25/Boe, driven primarily by a reclassification of expenses from G&A to LOE
• Production tax expense updated to $1.20-$1.50/Boe, with both ends of the range shifting downward by $0.10/Boe
• Exploration expense updated to $0.05-$0.15/Boe, with the low-end of the range down by $0.05/Boe

Second-quarter 2023 production and capital guidance:

• Production volumes are expected to average between 620 and 650 MBoepd, with oil estimated between 88.5 and 91.5 MBopd and natural gas volumes estimated between 2,750 and 2,850 MMcfpd.
• Expect capital expenditures (accrued) during 2Q23 between $510 - $570 million.

Coterra is currently running six rigs and two completion crews in the Permian Basin, two rigs in the Anadarko Basin, and three rigs and two completion crew in the Marcellus. The Company plans to drop to 2 rigs and 1 crew in the Marcellus during 2Q23, as expected in our original plan.

See "Supplemental non-GAAP Financial Measures" below for descriptions of the above non-GAAP measures as well as reconciliations of these measures to the associated GAAP measures.

Strong Financial Position

Coterra maintains a strong financial position with an investment-grade credit rating and approximately $2.5 billion of liquidity. As of March 31, 2023, Coterra had total long-term debt of $2.2 billion with a principal amount of $2.1 billion. The Company exited the quarter with a cash balance of $973 million, no debt outstanding under its new $1.5 billion five-year revolving credit facility, and no near-term debt maturities. Coterra's net debt to Adjusted EBITDAX ratio (non-GAAP) at March 31, 2023 was 0.2x.

Committed to Sustainability and ESG Leadership

Coterra is committed to environmental stewardship, sustainable practices, and strong corporate governance. The Company's sustainability report can be found under "A Sustainable Future" on www.coterra.com. Coterra plans to publish its 2023 Sustainability Report in the fourth-quarter of 2023.