Antero Family at a Glance 50/50 JV Exploration & Gathering & Natural Gas C3+ NGL Production Compression Processing Fractionation Water Delivery & Blending 4
Antero Resources at a Glance Denver, CO Antero Resources Acreage Map HEADQUARTERS Antero Marcellus Rig Industry Marcellus Rig S&P 400 Industry Utica Rig Antero Acreage CONSTITUENT SW Marcellus Core Ohio Utica Core 3rd Largest…
Asset Sale, Refinancing and Debt Repurchase Progress Antero has closed 751 MM in asset sales and 250 MM in refinancing to date to address debt maturities and deleverage Announced Asset Sale Program with Hedge Monetization (July 2020)…
Pro Forma Liquidity Post VPP, Convert and Debt Tenders Through a combination of asset sales, discounted senior note repurchases and the recent unsecured convertible note offering, Antero has plenty of liquidity to repay the November…
Much Improved Senior Note Term Structure Unsecured Debt Maturity Summary: Repurchased 1.3 B of senior notes including the 367 MM tender offer, resulting in 985 MM of senior note par value due through December 2022 1.1 B of pro forma…
Impressive Operational Momentum Lowered 2020 Capital Budget to 750 MM Revised D&C capital budget to 750 MM in 2020, a 35% decrease from initial 2020 guidance and a 41% decrease from 2019 spending 2020 production growth guidance of 8%…
2H 2020 Free Cash Flow The improvement in NGL pricing, combined with a significant reduction in capital and operating costs, is expected to result in 175 MM in Free Cash Flow in 2H 2020 2H 2020 Pricing & Production 2H 2020…
Significant Commodity Price Leverage As one of the largest natural gas and NGL producers in the U.S., Antero has significant cash flow upside in a rising commodity price environment Top 5 U.S. Natural Gas Producers (MMcf/d) Top 5 U.S.…
Leading Sustainability and ESG Metrics GHG Emissions Water Management Antero has zero flaring of produced gas, one of the lowest GHG Fresh water pipeline network intensity metrics in the industry (upstream independents and majors)…
Natural Gas and NGL Macro Momentum Natural gas and NGL prices expected to strengthen over the coming quarters as global demand remains resilient while supply declines materially (assuming current oil price strip) U.S. Natural Gas U.S.…
Significant Reduction in Drilling Rigs Since March 6th, the total U.S. rig count has declined by 528 rigs, or 69%, and oil focused rig count has declined by 74% NGL production associated with shale oil activity represents 65% of total…
Significant Reduction in Completion Crews Since March 6th, U.S. completion crew count has declined by 233 crews, or 74%, and oil focused completion crew count has declined by 78% U.S. Oil & Gas Drilling Completion Crew Count Since…
Material Impact to NGL Production in the U.S. The oil price decline is expected to have a pronounced impact on U.S. NGL supply, 65% of which comes from shale oil plays U.S. NGL Production Forecast (MBbl/d) LPG Export Capacity Gulf…
NGL Price Recovery Domestic and international LPG prices are improving on a relative basis to crude oil, driven by resilient global demand for LPG from petrochemicals and res/comm C3+ NGL Prices & % of WTI (1) Far East Index (FEI)…
NGL Pricing Outlook Limited liquidity in the futures market for C3+ NGL products often does not capture anticipated value further out in the curve A bottoms-up analysis of supply/demand fundamentals suggests NGL prices have…
Northeast LPG Supply & Demand Northeast LPG markets became oversupplied in 2015 and were forced to transport via rail, which was relieved by Mariner East 2 coming online in early 2019 The Northeast is now long LPG pipeline takeaway…
Strategy Aligned with Industry Risks & Reality Energy Industry Realities Commodity Price Risk Opportunistically Hedge Commodities 93% hedged on natural gas through 2021 Utilize Firm Transport - substantially reduces basis risk in an…
AR Business Strategy Antero Resources Principles Priorities 1 Build Scale with Balance capital spending Natural Gas & with cash flow Liquids Diversification 2 Maintain liquidity & strengthen balance sheet with medium term…
1 Balance Capex with Cash Flow - Cost Structure Reset Drilling and completion efficiencies and midstream cost savings are expected to result in approximately 616 million of savings in 2020 compared to ARs 2019 initial budget Cost…
1 Balance Capex with Cash Flow - Momentum Leads to Lower Capital Through drilling and completion efficiencies, midstream cost savings, service cost deflation and deferral of completions Antero has reduced its D&C capex budget by 41%…
1 Balance Capex with Cash Flow Low Maintenance Capital Antero Average Development Well 3,600 Avg. Lateral Length per Well 13,000 Net Production Rate: 3.45 Bcfe/d 3,400 Bcfe/1,000 2.71 Replacement Volume 213 Bcfe Wellhead Gas BTU…
1 Balance Capex with Cash Flow Drilling & Completion Efficiencies Average Lateral Length per Well Lateral Drilling Feet per Day 12,000 11,253 18,000 16,320 16,000 10,000 New 14,000 12,897 U.S. 8,000 Record 12,000 11,062 6,126…
1 Balance Capex with Cash Flow - Marcellus Well Cost Reductions Significant Reduction in Well Costs already in-hand Reduced well costs by 30% (3.5 million per well) Marcellus Well Cost Reductions (January 2019 AFE to Current 2020)…
1 Balance Capex with Cash Flow LOE Reductions Materially Reducing LOE Reducing LOE by 45% in 2020 (90 MM+) Antero Lease Operating Expense Reductions (2020 Target) (MM) 225 200 42.0 175 32.0 150 125 42 MM (0.03/Mcfe) 16.0…
2 Significant Steps Taken to Strengthen Balance Sheet The execution of 751 MM in asset sales, discounted senior note repurchases and the convertible notes offering has positioned AR to address upcoming bond maturities YE 2020…
3 Develop Highest ROR Locations AR Resource Overview AR Marcellus Asset Map Large Delineated Drilling Inventory Diverse set of locations AR holds 1,400 liquids-rich locations, or 40% of the core undrilled liquids-rich locations in…
3 Develop Highest ROR Locations - Premium NGL Price Realizations Diversified exposure to both international and domestic markets results in Antero realizing a premium to Mont Belvieu on its C3+ NGL pricing Domestic Markets…
3 Develop Highest ROR Locations - Premium NGL Price Realizations Producer Disadvantaged: Producer Advantaged & Unconstrained: E&Ps in Permian, Rockies, Mid-Con & Bakken Antero Resources in Appalachia AR is the largest C3+ producer…
3 Develop Highest ROR Locations - NGL Price Recovery NGL prices have risen on an absolute basis and relative to WTI since March/April lows AR Monthly Realized C3+ NGL Price /Bbl AR C3+ Realized Price (/Bbl) WTI Price % of WTI 70…
3 Develop Highest ROR Locations Attractive Well Economics Anteros average unhedged half cycle rate of return for its near-term development program areas is 52% Antero Half Cycle Well Economics by BTU Regime 70% Marcellus Utica…
4 Hedge Commodities - Natural Gas Price Exposure Mitigated Through 2021 AR monetized 100 BBtu/d of its 2021 hedges for proceeds of 29 million, attributable to the volumes included in the recently announced ORRI transaction In…
4 Firm Transport is a Competitive Advantage FT Destination Atlantic Seaboard 8% TCO Pool 9% Regional 13% Gulf Coast 51% Midwest 19% 37
4 Firm Transport Protects Basis Hedges + Firm Transportation + Liquids-Rich focus provides price stability and supports sustainable long-term development Strategy: Pair Hedges & FT Result: Low Natural Gas Pricing Volatility (2)…
2020 Credit Enhancement Momentum Reduced capital budget and operating cost structure improves Free Cash Flow profile while asset sales, hedge position and scale support debt profile Potential Credit 2019A 2020E Enhancement D&C…
Key Investment Attributes Antero is well positioned for both the commodity price outlook and energy transition as a large, low cost natural gas and NGL producer with strong ESG metrics Scale / 3rd Largest natural gas producer and…
Corporate Presentation Antero Resources Executive Summary Natural Gas & NGL Macro Detailed Asset Overview Appendix 41
Strategic Updates in 2020 Convertible Note Issuance (8/18/2020) 250 MM convertible senior note issuance due 2026 Coupon rate of 4.25% with 4.34 per share strike price Demonstrates access to unsecured debt financing Closed VPP…
As Adjusted Capitalization Table VPP / Bond Adjustments for As Further As Reported on Repurchases / As Adjusted Convertible Adjusted June 30, AR Capitalization (in millions) June 30, 2020 Tender Offer (1) June 30, 2020 Senior Notes…
Convertible Issuance Results in Minimal Share Dilution Antero intends to net share settle the convertible notes but will have the option upon conversion to settle in cash, shares, or any combination Non-callable for 3.5 years…
4 Hedge Commodities - Significant Oil Hedge Position AR has hedged 100% of expected oil and oil-equivalent pentane production in 2020 at 55.63/Bbl and 10% of oil and oil equivalent production in 2021 at 55.16/Bbl Antero Oil and…
Antero Resources Net Debt & LTM EBITDAX Reconciliation December 31, June 30, (in thousands) 2019 2020 AR bank credit facility 552,000 926,000 5.375% AR senior notes due 2021 952,500 516,202 5.125% AR senior notes due 2022 923,041…
Antero Resources 2019 LTM EBITDAX Reconciliation Twelve months ended (in thousands) December 31, 2019 Net loss and comprehensive loss attributable to Antero Resources Corporation (340,129) Net income and comprehensive income…
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