May 2018 Investor Update Repositioning to Win Contact: Paige Penchas Vice President, Investor Relations paige_penchasswn.com Phone: (832) 796-4068 NYSE: SWN
Delivering Today, Building for Tomorrow 2018 Production(1) Expanding breadth and depth of high return Appalachia inventory in a lower commodity price environment 72% Pursuing strategic alternatives for Fayetteville Shale Further…
Our Formula Drives our Success Delivering robust value growth in core Appalachia areas Low decline, cash flow generating Fayetteville asset Premier quality, large scale assets High degree of operational control and flexibility…
Asset Overview Reserves & Production 2017 Production: 897 Bcfe 12/31/2017 Reserves: 14.8 Tcfe Northeast Appalachia 2017 Reserves 4.1 Tcf (28%) PA 2017 Production 395 Bcf (44%) Net acres 191,226 (12/31/17) Southwest Appalachia…
Strategy Delivering Results Recent Highlights Total net production of 226 Bcfe, up 11% vs 1Q 2017 Liquids production up 37% Appalachian production of 159 Bcfe, or 1.77 Bcfe/d, up 29% First Quarter Net cash flow of 358 million,…
RBL Credit Facility Simplifying Capital Structure Executed secured revolving credit facility, electing initial commitment of 2 billion Improvement of terms and manageable covenants Total Debt / EBITDAX < 4.5x stepping down to 4.0x…
Doing More with Less in 2018 Capital Efficiency = Value Generated per Dollar Invested Capital allocation Shift to Appalachia Higher Force ranking projects based on returns Returns Expanding well economics and Higher cash Lower…
Increasing Capital Efficiency Improving PD F&D Costs Deliberate capital allocation to Appalachia driving down PD F&D costs Optimizing drilling and completion designs increasing EURs throughout Appalachia Drilling longer laterals and…
Appalachia Growth Story Investment and operational flexibility between wet and dry gas Production projected to grow 18% (assuming midpoints1) over 2017 from only 770MM in drilling and completions capital 30% increase in Southwest…
Southwest Appalachia Core position in premier play targeting stacked pays Operational and technical excellence driving inventory and margin expansion 2018 plan focusing on wet gas window of the panhandle to capitalize on improving…
Southwest Appalachia Increasing NGL realizations driving economics in SW Appalachia SWN ethane take-away portfolio provides direct exposure to attractive Gulf Coast/Mont Belvieu pricing utilizing ATEX capacity 5% increase in NGL…
Southwest Appalachia Increasing Capital Efficiency Strategic leasing and pad utilization process extending the expected average drilled lateral length to over 8,500 feet in 2H 2018 In Q1 2018, drilled the Companys longest well with…
Well-Positioned in Core Utica Acreage 1 Progressing technical and economic understanding of 15+ Tcf Utica resource base Advancing delineation efforts to enhance drilling economics Permitting 200 sq mile 3-D seismic acquisition 1 7…
Northeast Appalachia Delivering value now and in the future SWN Acreage Gross operated production of approximately 1,421 MMcf/d (1,166 MMcf/d net) as of March 2018 Leading transportation portfolio with advantaged basis…
Northeast Appalachia Generating Free Cash Flow 2018 expected to be an inflection year in Northeast Appalachia Basis improvement of 0.25/Mcf without significant transportation cost increases Realized a 0.04/Mcf premium to NYMEX in 1Q…
Fayetteville Core position with material production, cash flows and low risk inventory SWN Acreage Pursuing strategic alternatives for the Fayetteville Shale E&P and related midstream gathering assets Gross operated production was…
Fayetteville Redevelopment Identified numerous redevelopment Enhanced completion design driving significant outperformance opportunities 1,000 Average Cumulative Production per Enhanced Completion Design Historical Completion…
Vertical integration provides competitive advantages Strategic and economic benefit that lowers net well costs Provides improved operating efficiency and flexibility Mitigates service cost inflation Drilling Services 7…
Repositioning to Win Vast Appalachia acreage, inventory, and Pursuing strategic alternatives for growing liquids exposure Fayetteville Shale Margin expansion through cost Rigorous financial discipline reductions, improved well…
Appendix 2020
Corporate Governance Snapshot Strong governance practices Independence Independent oversight to serve the long-term interests of Southwestern Energy and our shareholders 9 out of 10 directors determined by Board to be independent(1)…
Executing on our Strategy Stabilize Optimize and Increase Value Reposition to Compete and Win Strengthened the balance Expanded margins and Actively pursue strategic sheet improved capital efficiency alternatives for the…
Rigorous Financial Discipline Strengthen the balance sheet No significant near-term maturities Strong liquidity position of approximately 1.7B(1) Targeting long-term net debt to EBITDA of 2x Invest within cash flow Fully funded…
Southwest Appalachia Rich vs Lean Economics Liquids Rich Economics F&D (/Mcfe) 2018 program targeting rich gas acreage with best economics in portfolio EUR - 16 Bcfe 400 Marcellus rich gas locations economic at 1.75/50 NYMEX price…
Southwest Appalachia Incremental Value Creation Significant incremental value being created through operational enhancements and value chain expansion with large upside remaining Rich Gas Lean Gas 12 12 Incremental Single Well NPV…
Southwest Appalachia Increasing NGL realizations driving enhanced economics Growing cracker demand and export capacity expected to further strengthen ethane pricing NGL exposure provides optionality to maximize returns based on…
Southwest Appalachia Improving basis differentials as a result of pipeline infrastructure Over the next 4 years, executed transportation agreements will provide a pathway for 9 BCF/d of production to leave the Southwest Appalachian…
Southwest Appalachia Takeaway Increasing Gulf Coast market exposure 1.00 0.90 0.80 0.70 0.60 TransCanada MXP Columbia Gas Transmission MXP (project not in service) Bcf/d 0.50 0.40 0.30 ETC Rover ETC Rover 0.20…
Southwest Appalachia Rich Gas Horizontal well performance Well Results ExceedingSWN Expectations Drilled & Completed Rich Gas Condensate (Normalized to 7,500 ft lateral) Production Mix 15% Gas 37% NGL Oil 48% Average Avg…
Southwest Appalachia Lean Gas Horizontal well performance Well Results ExceedingSWN Drilled & Completed Lean Gas Condensate Expectations (Normalized to 7,500 ft lateral) Production Mix 1% Gas 47% NGL 52% Oil Average Avg…
Northeast Appalachia 3434
Northeast Appalachia Takeaway Low cost portfolio with extensive market reach 1.8 1.6 1.4 1.2 ConstitutionConstitution 1.0 BCF/d Transport Extension Options 0.8 Transport Extension Options 0.6 0.4 Firm Transportation…
Northeast Appalachia Improving basis differentials driving margin expansion SWN transportation portfolio structured to capture materiallyimproving Northeast basis differentials Over the next 4 years, executed transportation…
Northeast Appalachia Continued improvement Operating Statistics Average Average Avg Rate Avg Rate of Wells for 1st for 1st Completed Completed 12.9 Time Frame Placed to 30 Days 60 Days Lateral Well Cost Sales (Mcfe/d) (Mcfe/d) 7.0…
Northeast Appalachia Completions and flowback optimization enhancing economics Susquehanna County initial EUR increase of over 25% compared to previous operational design due to changes in completion intensity and flowback methods…
Northeast Appalachia Well performance by area 25,000 Normalized Normalizedto to6,500 6,500CLAT CLAT 20,000 Daily Rate (Mcf/d) 15,000 10,000 Impact of third-party gathering line issues, which were resolved in late…
Fayetteville 4040
Fayetteville Operating Statistics Time Frame Wells Average Placed on IP Rate 30th-Day Avg Rate 60th-Day Avg Rate Average Lateral Production (Mcf/d) ( of wells) ( of wells) Length (ft) (1) 11.7 (1) 4.2 1st Qtr 2015 99 4,424…
Fayetteville Takeaway High correlation to Henry Hub 2.0 1.8 1.6 1.4 1.2 Bcf/d 1.0 0.8 Firm Transportation Capacity 0.6 Volumetric Firm Transport 0.4 0.2 - Sales Locations SWN Firm Reservation Firm Sales Rate…
Fayetteville Historical well performance SWN has production history in 4,000 wells from the Fayetteville Shale in an expansive area with well- understood rock properties, homogenous subsurface Significant opportunity for…
Vertical Integration 4545
Midstream SWN Marketing 2017 Total volumes marketed (Bcfe) 1,067 Q1 2018 Total volumes marketed (Bcfe) 265 Fayetteville Shale Gathering Gathered volumes at Mar 31, 2018 (Bcf/d) 1.3 Gathering lines at Mar 31, 2018 (Miles) 2,045…
Southwest Appalachia Water Infrastructure Commenced water infrastructure project to capture additional value Expected to generate savings of 500,000 per well beginning in late 2018, an 8% improvement in F&D costs Reduces break-even…
Other 4848
An Industry Leader in Corporate Responsibility Freshwater neutral December 2016 Reviewed 100% of chemicals used Gold Certification by IES 3.2 billion gallons of water conservation for hydraulic fracturing since 2016 (Independent…
Appalachia Takeaway Capacity Improving basis differentials as a result of pipeline infrastructure 40.0 35.0 30.0 25.0 BCF/d Over the next 4 years, executed transportation agreements will provide a pathway for 12…
Financial and Operational Summary 3 Months Ended March 31, Year Ended Decem ber 31, 2018 2017 2017 2016 2015 ( in millions, except per share amounts) ( in millions, except per share amounts) Revenues 920 846 3,203 2,436 3,133…
Explanation and Reconciliation of Non-GAAP Financial Measures: Net Cash Flow We define net cash flow as cash flow from operating activities adjusted for changes in operating assets and liabilities and restructuring charges. Management…
Explanation and Reconciliation of Non-GAAP Financial Measures: Adjusted Net Income Attributable to Common Stock Additional non-GAAP financial measures we may present from time to time are adjusted net income attributable to common stock…
Explanation and Reconciliation of Non-GAAP Financial Measures: Adjusted EBITDA EBITDA is defined as net income plus interest, income tax expense, depreciation, depletion and amortization. Adjusted EBITDA is defined as EBITDA less gains…
Explanation and Reconciliation: Proved Developed Finding and Development Costs Proved developed (PD) finding and development (F&D) costs are computed here by dividing exploration and development capital costs incurred, excluding…
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