Investment Highlights: Leading Small-Cap, Permian Focused Producer Top Investment Criteria Earthstones Qualifications Basin & Acreage High quality, Midland Basin acreage position enhanced by recent Position acquisition Low…
Proven Leadership and Track Record of Value Creation Operating team has extensive experience operating across various basins and in different operating environments Leadership Team Years of Experience Years Working Together Title…
2020: Managing Oil Price Collapse and Delivering Results Uncontrollable, Mitigated via Controllable via Proactive Response Results Hedging WTI Oil Production D/EBITDAX CAPEX(2) LOE(2) Cash G&A(2) (3) EBITDAX(4) (5) Price(1)…
Oil Price Volatility Requires Focused Business Strategy WTI trading in range of 40-70 per barrel vs. 80-110 per barrel since OPEC / Shale standoff commenced in 2H 2014, but with periods above and below trading range, including a…
Managing Through Oil Price Volatility December 2015 May 2017 October 2017 December 2017 May 2020 June 2016 Acquired 20,900 Net 40MM Divested Bakken Voluntarily Announces Acquisition of 45MM Common Acres from Bold Energy, Common…
Company Overview The Woodlands, Texas based E&P company focused on development and production of oil and natural gas with current operations in the Midland Basin Asset Overview Midland Basin (34,000 core net acres(1)) and the Eagle…
Independence Resources Acquisition 9
Independence Resources Acquisition Overview and Key Highlights 182 million acquisition(1) of Independence Resources Management, LLC underwritten on PDP value but provides attractive drilling inventory additions Increases ESTE…
IRM Acquisition Details Closed on 1/7/21 Earthstone acquired Independence Resources Management, LLC and certain related entities (IRM) on 1/7/2021 Cash and equity consideration of 182.0 million Cash consideration of 131.2 million…
Strategic Acquisition Bolsters Existing Midland Basin Position IRM Asset Overview Combined Midland Basin Map Complementary Midland Basin assets meaningfully increase ESTE size and scale 3Q20 production of 8,780 Boepd (66% oil)(1)…
IRM Spanish Pearl and Offset Operator Well Results IRM Spanish Pearl Area Activity IRM Spanish Pearl and Offset Well Results(1) 6 Month Oil Cum / Well Well Name Operator TLL (ft.) Comp. Date 1,000' (bo) 1 Whittenburg 9MS IRM 9,857…
IRM Acquisition Meets Key Earthstone Criteria Earthstone IRM Commentary Objectives Acquisition Increases ESTE size and scale by 50% with minimal impact to leverage and Increase Scale at shares outstanding Favorable Valuations…
Meaningful Improvement to Key Operational Metrics Transaction increases production and Adjusted EBITDAX by 50% with minimal impact to leverage and shares outstanding 3Q20 Net Production (Boe/d)(1) 9/30/20 LTM Adjusted EBITDAX…
Transaction Improves Key Metrics Without Impacting Balance Sheet Metrics ESTE expects to pick up an operated rig in late 1Q 2021 IRMs Spanish Pearl asset is expected to compete for capital with existing ESTE assets in a 1-rig…
Earthstone Overview 17
Midland Basin Growth Story Since entering the Midland Basin in 2016, Earthstone has substantially increased production and decreased operating expenses, which has resulted in increased Adjusted EBITDAX, while also maintaining low…
Continuous Focus on Operational Improvement A continued focus on driving down costs and increased efficiencies achieved by developing larger pads and driving down drilling and completion days Actual Drilling, Completions & Equip. Cost…
Highly Focused Environmental Stewardship Key Environmental Priorities Focus on Responsible Operatorship Installation of Vapor Recovery Units (VRUs) in conjunction with tank battery construction minimizes air emissions Target…
Areas of Operations (1) (1) Total Legacy Midland Basin Total Proved Developed (Mmboe) 56.0 Total Proved Developed (Mmboe) 36.0 Total PD PV-10 (mm) 653 Total PD PV-10 (mm) 399 (2) 4Q20 Net Production (Boe/d) 22,551 (2) 4Q20 Net…
Reserves Summary Year-End 2020 SEC Proved Reserves(1) Oil Gas NGL Total PV-10 Reserves Category (Mbbls) (MMcf) (Mbbls) (Mboe) ( in thousands) Proved Developed 18,878 55,764 10,125 38,298 329,395 Proved Undeveloped 21,212 55,450…
Substantial Economic Inventory in Midland Basin Midland Basin Overview Gross Locations by Lateral Length and Target(2) Long lateral development increases capital efficiency Gross Locations by Lateral Length 5,000' - 6,750' - Target…
Financial Overview 26
Capital Budget, Guidance and Liquidity ESTE 2021 Capital Budget 2021 FY Guidance 2021 Average Daily Production (Boepd) 19,500 - 21,000 Gross / Net Gross / Net Net Operated Operated Non-Op % Oil 52% - 54% ( in millions) Wells…
Oil and Gas Hedges Summary 100% Swaps Oil Production Hedges - 100% Swaps Gas Production Hedges - 100% Swaps Period Volume (Bbls) Volume (Bbls/d) /Bbl Period Volume (MMBtu) Volume (MMBtu/d) /MMBtu 1Q 2021 936,840 10,409 47.04 1Q 2021…
Analyst Coverage Firm Analyst Contact Info Alliance Global Partners Andrew Bond / 203-577-5427 / abondallianceg.com Johnson Rice Dun McIntosh / 504-584-1217 / dunjrco.com Northland Jeff Grampp / 949-600-4150 /…
Contact Information Mark Lumpkin, Jr. EVP, Chief Financial Officer Scott Thelander Vice President of Finance Corporate Offices Houston 1400 Woodloch Forest Drive Suite 300 The Woodlands, TX 77380 (281) 298-4246 Midland…
Appendix 31
Reserves Summary Alternative Pricing The information presented below includes the combination of the stand-alone reserve quantities and PV-10 for Earthstone and IRM as of December 31, 2020 prepared in accordance with Society of…
Reconciliation of Non-GAAP Financial Measure Adjusted EBITDAX Earthstone uses Adjusted EBITDAX, a financial measure that is not presented in accordance with accounting principles generally accepted in the United States (GAAP). Adjusted…
Reconciliation of Non-GAAP Financial Measure LTM Adjusted EBITDAX 9/30/20 LTM Adjusted EBITDAX ( in 000s) ESTE IRM Pro Forma Net (loss) income (16,693) (66,645) (83,338) Accretion of asset retirement obligations 191 1,254 1,445…
Reserves Summary and PV-10 (Non-GAAP Financial Measure) Earthstones proved reserves as of December 31, 2020 were independently estimated by Cawley, Gillespie & Associates, Inc. (CGA), independent petroleum engineers, utilizing SEC…
Non-GAAP Financial Measure Free Cash Flow Free Cash Flow is a non-GAAP financial measure that we use as an indicator of our ability to fund our development activities. We define Free Cash Flow as Adjusted EBITDAX (defined above), less…
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