BAML Leveraged Finance Conference NOVEMBER 29, 2017 PREMIER OPERATOR OF TOP TIER ASSETS 1
SM Energy Focused 3-Year Plan Top tier oil in Midland Basin + top tier NGLs and gas in Eagle Ford Midland Basin 89,000 net acres 7 Rigs / 4 Frac Crews Eagle Ford 165,000 net acres 2 Rigs 3 3
SM Energy Premier Operator of Top Tier Assets Permian production growth translating Value into proposition significant margin expansion RockStar wells show high oil content and highest revenue per foot in the Midland Basin…
3Q17 Financial Highlights Outstanding execution 2017 plan on track or better EBITDAX ahead of plan despite notably lower commodity prices Permian production up 31% sequentially; up 118% since 4Q16 Total production mix 32% oil;…
Balance Sheet Financial Position Liquidity of 1.4B, including 441MM cash on hand(1) Balance Sheet offers financial flexibility(1) No bond maturities until 2021 Senior Secured Debt:TTM Adjusted EBITDAX at 0.0 times; max ratio allowed…
Well Hedged(1) 4Q17 percentage of expected production hedged Production Hedged 80% of expected 4Q17 production volumes hedged(2) 95% 31 MMBoe expected production hedged in 2018 (36% oil, 39% natural 4Q17 80% gas, 25% NGLs)…
Premier Operator of Top-Tier Assets 8
Outstanding Results Midland Basin Midland Basin 89,000 net acres Midland Basin Program Operating 7 horizontal rigs RockStar Operating 4 completions crews; 23 net operated completions during 3Q17 Production up 31% 3Q17/2Q17;…
Premier Operator Midland Basin Top Operator Well productivity SM ENERGY RANKS 1 BMO data 8/7/17 BMO research Phillip Jungwirth August 7, 2017 10
Outstanding Well Results Based on our in-depth analysis of historic well data we see Howard County as one of the most valuable parts of the Midland Basin given higher oil cuts that decline slower than other areas -Credit…
Premier Operator Midland Basin Applying seismic, core, and geo-chem data to optimize development Planned 3-D Seismic Acquisition Modern 3-D Seismic Grid 12
Premier Operator Midland Basin Top assets Howard County Highest oil content, flattest curve HOWARD COUNTY RANKS 1 BMO data 8/7/17 BMO research Phillip Jungwirth August 7, 2017 13
Howard County New Well Results(1) Additional Details Peak IP 24 Hour Clusters Lateral IP per Proppant Oil Well Name Interval Rate IP Days Peak IP Stages per Length 1,000 (lbs./ft) % (BOE/d) Rate Stage Griswold 3-46 A 1WA(2) WCA…
Outstanding Results Howard County Great results in multiple intervals across acreage position Iceman 0241WA(1)(4) Iceman 0243WA(1)(6) IP30: 1,468 BOE/d (89% oil) IP30: 1,699 BOE/d (90% oil) Sundown Pad Interval: Wolfcamp A Interval:…
Howard County Viper 14-09 1WA Viper results to date continuing to exceed expectations 10,000 Viper 14-09 1WA Production Rate (BOEPD) 1,000 Western Howard County Well Average 100 10 0 50 100 150 200 Days on…
Howard County Top Tier Well Performance Continues New wells continue outperformance trend 250,000 Gross Cumulative Production (BOE) 200,000 150,000 100,000 50,000 0 0 30 60 90 120 150 180 210 240 270 300 330…
Outstanding Results Eagle Ford Eagle Ford Operated 165,000 net acres Eagle Ford Program Dimmit County Webb County Currently operating 2 horizontal rigs North Area Initiated JV in portion of Eagle East Ford North to…
Premier Operator Eagle Ford Capital efficiency - better wells and lower costs Drilling Costs Completion Costs 500 9,000 1,000 2,500 Proppant Per Lateral Foot (lb/ft) Completion Cost Per Foot (/ft) 450 8,000 900 Average…
Building Value Eagle Ford North JV Accelerating application of technology to grow returns and inventory 10 Co-development UEF/LEF Normalized Gross Cumulative Production (BOE/ft)(1) 9 Dimmit County Webb County 8 7 North…
PRB Creating Value Through Successful JV Tests New completion technology driving 40% improvement in wells Powder River Basin Sussex 10,100 TVD Utilizing partner services and capital in current Shannon development activity(1)…
SM Energy Why Invest in SM Premier operator of top tier assets Value proposition Doubling cash flow over two years Liquidity Drilling cash on hand; catalysts zero bank debt Drilling catalysts Hedging Rapid, provides…
Appendix 23
3rd Quarter and YTD 2017 Performance Solid Execution Production 3Q17 2017 YTD(1) Total Production (MMBoe) 10.7 34.1 Average Daily Production (MBoe/d) 116.0 124.9 Pre-Hedge Realized Price (/Boe) 27.59 26.76 Post-Hedge Realized Price…
3Q17 Regional Realizations Benchmark Pricing NYMEX WTI Oil (/Bbl) 48.20 NYMEX LLS Oil (/Bbl) 50.42 NYMEX Henry Hub Gas (/MMBTU) 3.00 Hart Composite NGL (/Bbl) 27.55 Production Volumes Eagle Ford Op(1) Permian Rocky Mountain SM Total Oil…
2017 Activity Wells Drilled, Flowing Completions & DUC Count Wells Drilled Flowing Completions DUC Count 3rd Quarter 2017 2017 YTD 3rd Quarter 2017 2017 YTD As of 9/30/17 Region Gross Net Gross Net Gross Net Gross Net Gross Net…
Leasehold Summary As of September 30, 2017 Net Acres(1) Area 9/30/17 Midland Basin Sweetie Peck 17,255 RockStar(2) 65,435 Halff East (Upton County) 5,985 Midland Basin Total 88,675 Eagle Ford Operated 165,050 Rocky Mountain…
Adjusted EBITDAX Reconciliation Reconciliation of net loss (GAAP) to adjusted EBITDAX (non-GAAP) to Three Months Ended Nine Months Ended net cash provided by operating activities (GAAP): (in thousands) September 30, 2017 September 30,…
Adjusted Net Loss Reconciliation Reconciliation of net loss (GAAP) to adjusted net loss Three Months Ended Nine Months Ended (non-GAAP): (in thousands, except per share data) September 30, 2017 September 30, 2017 Net loss (GAAP)…
Total Capital Spend Reconciliation Reconciliation of costs incurred in oil and gas activities (GAAP) to Total capital spend Three Months Ended Nine Months Ended (Non-GAAP)(1)(3) (in millions) September 30, 2017 September 30, 2017…
Oil and Gas Derivative Positions By quarter through 2018 Fixed Swaps Oil Gas Volume Volume Period (MBbls) /Bbl(1) (BBTU) /MMBTU(1) 4Q17 1,510 47.11 22,001 3.98 1Q18 1,075 50.16 20,788 3.25 2Q18 1,534 49.57 15,712 2.85 3Q18 1,769…
NGL Derivative Position(1) By quarter through 2018 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…
Top-Tier Assets 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%…
NGL Realizations 35% increase in realized price (before hedges) from 3Q16 to 3Q17 SM NGL price realizations are predominately tied to Mont Belvieu, fee based contracts Differential reflects NGL barrel product mix and transportation…
Howard County Previously Reported Wells Details Peak IP 24 Hour Clusters Lateral IP per Proppant Oil Well Name Interval Rate IP Days Peak IP Stages per Length 1,000 (lbs./ft) % (BOE/d) Rate Stage Tackleberry 43-42 A 1LS LS 7,873…
Outstanding Results Eagle Ford North Outperformance: new generation completion includes tighter stage and cluster spacing with increased fluid per foot Operated Eagle Ford Recent Well Results 3Q17 Completions 2Q17 30 Normalized…
Howard County Operators SM Energy Callon Encana Surge/Yantai Xinchao Diamondback Oxy Energen Breitburn Sabalo 37
Sweetie Peck Operators SM Energy Apache Chevron Concho Devon Diamondback Discovery Endeavor Exxon Legacy Oxy Pioneer Summit Miscellaneous 38
Eagle Ford Operators Dimmit Maverick Dimmit Webb Area North Fasken Area East Area South 39
Divide County Operators Canada CPEG RE RE HES CPEG RE MV MV CLR MRX HNT NP Divide Williams KKN CLR HES CPEG 40
Powder River Basin Operators Johnson Campbell SM ENERGY (SME) Natrona Converse ANSCHUTZ (ANS) CHESAPEAKE (SHK) DENBURY (DEN) DEVON (DEV) EOG FLEUR DE LIS (FDL) HELIS (HEL) LIBERTY RESOURCES (LIB) SAMSON (SSN) WOLD (WLD)…
Contact Information Jennifer Martin Samuels Senior Director, Investor Relations 303-864-2507 jsamuelssm-energy.com 42
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