Q1 2017 Earnings Call PREMIER OPERATOR OF TOP TIER ASSETS 1
2017 Off to a Great Start Highlights On track or ahead of expectations to date driven by experienced SM team Ramping up quickly Well performance exceeding expectations Closed 800 MM non-operated Eagle Ford asset sale 3 3
1st Quarter 2017 Results Highlights Outstanding first quarter execution Production, Adjusted EBITDAX, & Adjusted EPS - Beat consensus estimates - Strong well performance Balance sheet strengthening Production guidance…
1st Quarter 2017 Performance Production 1Q17 Total Production (MMBoe) 12.1 Average Daily Production (MBoe/d) 134.4 Pre-Hedge Realized Price (/Boe) 27.55 Post-Hedge Realized Price (/Boe) 27.55 Costs LOE (/Boe) 3.82 Ad Valorem…
Financial Discipline Strengthening the Balance Sheet On track with 2017 financial strategy Liquidity of 1.6 billion (as of March 31, 2017) 747 million net cash proceeds from non-operated Eagle Ford sale March 2017 Net debt reduced to…
Financial Discipline Hedging Provides Cash Flow Stability 80% of expected 2017 production volumes hedged (at the midpoint of guidance) 70% of oil, 85% of natural gas and 80% of NGLs Approximately 1/2 of expected 2018 volumes hedged…
2017 Guidance(1) Capital & Production FY 2017 Total Capital Spend (MM)(2) (before acquisitions) 875 Total Production (MMBoe) 41.5 44.5 Costs LOE, including Ad Valorem (/Boe) 4.00 Transportation (/Boe) 5.50 - 5.75 Operated Eagle…
Premier Operator Applying technology to optimize development Example: Venkman wells in RockStar Area Acquiring core and log data 140,000 120,000 Cumulative Production (BOE) Steering to best zones 100,000 Improved…
Howard County Significant Increase in Activity Industry confidence drives increased drilling activity across the county January 2017: 18 Rigs April 2017: 28 Rigs 10
RockStar Top Tier Well Performance Continues Initial production rates on SM completed wells soundly beating acquisition assumptions 240,000 220,000 Gross Cumulative Production (BOE) 200,000 180,000 160,000 140,000…
Howard County Recent Well Results Recent wells targeting three intervals: Wolfcamp A, Wolfcamp B, and Lower Spraberry 1Q17 Wells Lateral IP Rate IP Well Name Interval Length (BOE/d) Days Guitar North 2722LS(1) LS 9,692 1,093+ 20…
Eagle Ford Increasing Value With More Wells Per Section All three areas support UEF/LEF co-development East Operated Eagle Ford Recent Well Results 4Q16 Completions 50 Continued Outperformance at 312 plan view spacing Gross…
SM Energy A Premier Operator of Top Tier Assets 3 Year Plan Expected Outcomes: Big growth in Big growth in Debt:EBITDAX Top Tier high-margin cash flow 2x in 2019 portfolio production 2017 Priorities: Midland Basin Focus…
Appendix 15
1Q17 Regional Realizations Pricing NYMEX WTI Oil (/Bbl) 51.91 NYMEX LLS Oil (/Bbl) 53.39 NYMEX Henry Hub Gas (/MMBTU) 3.32 Hart Composite NGL (/Bbl) 26.74 Eagle Ford SM Retained Production Volumes Eagle Ford Op(1) Rocky Mountain…
2017 Activity Wells Drilled, Flowing Completions & DUC Count Wells Drilled Flowing Completions DUC Count 1st Quarter 2017 1st Quarter 2017 1st Quarter 2017 Region Gross Net Gross Net Gross Net Permian Sweetie Peck 7 7 11 11 7 7…
Leasehold Summary Pro-forma for planned transactions Net Acres(1) Pro-forma 3/31/17 Planned Sales Net Acres Midland Basin Sweetie Peck(2) 15,880 - 15,880 Halff East (Upton County) 5,985 - 5,985 RockStar 66,195 - 66,195 Eagle Ford…
Regional Well Projected Economics 2017 capital program focusing on areas with top tier returns RockStar Wolfcamp A Sweetie Peck Lower Spraberry 120% 120% 100% 100% 80% 80% IRR 60% 60% IRR 40% 40% 20% 20% 0% 0% 40…
Adjusted EBITDAX Reconciliation Reconciliation of net income (GAAP) to Adjusted EBITDAX (non-GAAP) to Three Months Ended net cash provided by operating activities (GAAP): (in thousands) March 31, 2017 Net income (GAAP) 74,434…
Adjusted Net Loss Reconciliation Reconciliation of net income (GAAP) to adjusted net loss (non-GAAP): Three Months Ended (in thousands, except per share data) March 31, 2017 Net income (GAAP) 74,434 Net derivative gain (114,774)…
Total Capital Spend Reconciliation Three Months Reconciliation of Costs Incurred in Oil and Gas Activities (GAAP) Ended to Total Capital Spend (Non-GAAP)(1) (in millions) March 31, 2017 Costs incurred in oil and gas activities…
Derivative Positions Summary By Quarter Through 2018 As of April 26, 2017 Fixed Swaps Oil Gas NGL(3) Volume Volume Volume (2) Period (MBbls) /Bbl(1) (BBTU) /MMBTU(1) (MBbls) /Bbl 2Q17 1,444 46.44 26,205 3.98 2,114 21.40 3Q17 1,340…
NGL Derivative Position Detail(1) NGL Swaps OPIS Eth Purity Mt Belv NGL Swaps OPIS Propane Mt Belv Non-TET NGL Swaps Natural Gasoline Mt Belv Non TET Volume Volume Volume (2) (2) (2) Period (MBbls) /Bbl Period (MBbls) /Bbl Period…
NGL Realizations Nearly 90% increase in realized price (before hedges) from 1Q16 to 1Q17 SM NGL price realizations are predominately tied to Mont Belvieu, fee based contracts Differential reflects NGL barrel product mix and…
Contact Information Jennifer Martin Samuels Senior Director, Investor Relations 303-864-2507 jsamuelssm-energy.com 26
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