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2Q22 Earnings Presentation – California Resources Corp.

California Resources Corp. · Aug 2, 2022 · 36 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. 2Q22 Earnings Presentation – California Resources Corp. – slide 1
    Low Carbon Intensity Fuel for Today and Net Zero Fuel for The Future Second Quarter 2022 Results August 3, 2022
  2. 2Q22 Earnings Presentation – California Resources Corp. – slide 2
    Presenters Mac McFarland President & Chief Executive Officer Francisco Leon EVP & Chief Financial Officer
  3. 2Q22 Earnings Presentation – California Resources Corp. – slide 3
    2Q22 Highlights 91 MBOE/D 59% 13% 28% 2Q22 NET PRODUCTION Oil NGLs Gas Global Transition Fund (BGTF) 181MM 98 83 2Q22 OPERATING CASH FLOW Capex Free Cash Flow 1 Initial commitment6 of 96MM 2Q22 SRP 148 2021 212 2022YTD…
  4. 2Q22 Earnings Presentation – California Resources Corp. – slide 4
    Second Quarter 2022 Results
  5. 2Q22 Earnings Presentation – California Resources Corp. – slide 5
    Second Quarter 2022 Corporate Earnings FREE CASH FLOW1 GENERATION 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 150 Adjusted Net Income1 102 78 151 175 91 89 (MM) Free Cash Flow1 (MM) 100 Adjusted Net Income1 per Share Diluted 1.22 0.94…
  6. 2Q22 Earnings Presentation – California Resources Corp. – slide 6
    Strong Price Realizations in CAs Unique Market Dynamics CALIFORNIA IS AN ENERGY ISLAND AND THE LARGEST U.S. GDP CONTRIBUTOR Crude: CRCs 2Q22 physical crude realizations w/o hedges were the highest (amounts shown as % of U.S. domestic…
  7. 2Q22 Earnings Presentation – California Resources Corp. – slide 7
    Focus on Maintaining Margin to Offset Rising Energy Costs and Inflation Natural gas markets continued to drive cost increases primarily in CRC 2Q22 MARGIN electricity generation and, to a lesser extent, steamflood operations, which…
  8. 2Q22 Earnings Presentation – California Resources Corp. – slide 8
    Growing Net Oil Production Amidst a Challenging Macro Environment Running 5 out of 7 active drilling rigs1 in California and continuing to deliver strong operational results Delay in Kern County EIR litigation and the subsequent…
  9. 2Q22 Earnings Presentation – California Resources Corp. – slide 9
    Raising 2022E Corporate Adj. EBITDAX1 and FCF1 Guidance REVISED CRC GUIDANCE2 Prior E&P, Corp. & Other Revised E&P, Corp. & Other Prior CMB Revised CMB Prior FY22E Revised FY22E Total Production3 (MBOE/D) 94 91 94 91 94 - 91 94 - 91 Oil…
  10. 2Q22 Earnings Presentation – California Resources Corp. – slide 10
    California Carbon Management Partnership
  11. 2Q22 Earnings Presentation – California Resources Corp. – slide 11
    Defining the Energy Transition From the E&P Perspective California CCS Market Today CRC Evolution EPA Permitted (Class VI) pore space is a scarce Multi-basin portfolio with 1 BMT of identified CO2 storage1 resource in the value chain…
  12. 2Q22 Earnings Presentation – California Resources Corp. – slide 12
    Creating a California Carbon Management Partnership to Advance the Energy Transition Solid Progress Initial commitment1 of On Our Carbon Management Strategy 500MM August Formation 2022 of Strategic Partnership Global…
  13. 2Q22 Earnings Presentation – California Resources Corp. – slide 13
    Strategic Partnership and Carbon TerraVault Joint Venture Details Global Transition Fund (BGTF) Joint Venture Initial commitment1 Wholly owned by CRC 500MM (with potential for follow-on Contribution of 10/MT on permitted…
  14. 2Q22 Earnings Presentation – California Resources Corp. – slide 14
    Strategic Partnership Provides a Structural Capital Advantage to CRCs Net Zero Strategy Assuming partnership is successful and partner funds its share of the 5MMTPA storage target, CRC can fund its portion of capital calls from the…
  15. 2Q22 Earnings Presentation – California Resources Corp. – slide 15
    Strategic Partnership - Rationale Secures CMB Level Investment From the Largest Global Transition Fund Aligns CRCs 2045 Net Zero Goal, Paris-Aligned Business Plan, and Our Carbon Management Strategy Highlights Value of Our…
  16. 2Q22 Earnings Presentation – California Resources Corp. – slide 16
    Strategic Partnership - A Strong Combination Global Transition Fund (BGTF) CRC is dedicated to being a significant part of the solution for reaching and With 725B AUM and over 200B of AUM in energy and infrastructure maintaining…
  17. 2Q22 Earnings Presentation – California Resources Corp. – slide 17
    Strategic Partnership Leverages CRCs Unique Asset Position in California CTV has a multi-basin portfolio of storage opportunities that are in close proximity to more than 45MMTPA1 of addressable emissions sources CA wide subsurface…
  18. 2Q22 Earnings Presentation – California Resources Corp. – slide 18
    Strategic Partnership Creates Strong Development Capabilities Built on First Mover Advantage Most CO2 Storage Permits Filed on the Record in the U.S. EPA CLASS VI PERMIT CALIFORNIA APPLICATIONS BY STATE1 CLASS VI PERMIT…
  19. 2Q22 Earnings Presentation – California Resources Corp. – slide 19
    California Air Resources Board (CARB) 2022 Climate Change Scoping Plan Governor Newsoms Response to CARB CCS Plays an Increasing Role in Californias Carbon Neutrality Goals as Part of CARB 2022 Simply put, it will not be possible to…
  20. 2Q22 Earnings Presentation – California Resources Corp. – slide 20
    Proposed Inflation Reduction Act Significantly Enhances the Value of 45Q Credits Inflation Reduction Act of 2022 includes 369B in climate and Project developers will have the option energy spending to provide policy The deadline…
  21. 2Q22 Earnings Presentation – California Resources Corp. – slide 21
    Strategic Partnership Develops Economic Carbon Management Opportunities in California Assumed Potential Economic Incentives1 Example Strategic Partnership Project Cash Flow Profile3 FEDERAL 45Q TAX CREDIT Terminal 50 (2026) Est.…
  22. 2Q22 Earnings Presentation – California Resources Corp. – slide 22
    Strategic Partnership Aligned with CRCs CMB Goals - On Track for 5MMTPA Target by YE2027 Aligned with CRCs 2027 goal: The Strategic Partnership is targeting the injection of 5MMTPA and 200MMT of CO2 storage development As partnership…
  23. 2Q22 Earnings Presentation – California Resources Corp. – slide 23
    CRC / Carbon TerraVault Supporting our Local Communities and Investing in the Energy Transition Kern County Energy Transition 2.5MM Pledge CRC Carbon Management Institute at Kern Community College District Research and Development…
  24. 2Q22 Earnings Presentation – California Resources Corp. – slide 24
    Revised Capital Allocation Framework
  25. 2Q22 Earnings Presentation – California Resources Corp. – slide 25
    Consistently Delivering Value to Shareholders CRCs Total Shareholder Returns to Date1 700 66% SRP Dividend of total generated FCF2 since 4Q20 returned to shareholders 600 500 290MM 400MM Repurchased 360MM since the…
  26. 2Q22 Earnings Presentation – California Resources Corp. – slide 26
    Leading Total Shareholder Returns Strategy & Reserves Valuation CRC Screens Robustly Against Its Peers Enterprise Value4 and PV-10 of Proved Reserves Value3 25% HIGH YIELD LOW MULTIPLE HIGH YIELD HIGH MULTIPLE 7,896 MM6 20%…
  27. 2Q22 Earnings Presentation – California Resources Corp. – slide 27
    Revising Capital Allocation Framework to Deliver Further Growth & Increase Returns Targeting 2.7B Of Cumulative After-Tax FCF1,2 through 2026 from E&P, Corporate and Other After Reinvesting E&P, Corporate and Other FCF1 Available…
  28. 2Q22 Earnings Presentation – California Resources Corp. – slide 28
    Summary Decarbonization Focused Strategic Partnership With The Largest Global Transition Fund Aligns With CRCs Strategy & Low Carbon Intensity Operations Dedicated Capital to Significantly Advance Energy Transition in California…
  29. 2Q22 Earnings Presentation – California Resources Corp. – slide 29
    Supplemental Materials
  30. 2Q22 Earnings Presentation – California Resources Corp. – slide 30
    Wilmington Production Sharing Contracts (PSC) At Higher Commodity Prices EFFECT OF OIL PRICE ON NET PRODUCTION2 For every 1/BBL increase/decrease in Brent price, we expect a 75 BO/D decrease/increase in our Gross Production net oil…
  31. 2Q22 Earnings Presentation – California Resources Corp. – slide 31
    Hedging Program OIL HEDGES1 Date as of June 30, 2022 3Q22 4Q22 1Q23 2Q23 2H23 2024 Barrels per Day 34,380 25,167 18,322 17,837 11,555 STRATEGY SOLD CALLS Weighted- CRCs commodity hedging approach is expected to look Average…
  32. 2Q22 Earnings Presentation – California Resources Corp. – slide 32
    Maintaining Balance Sheet Strength, Liquidity, and Financial Flexibility ESTIMATED LIQUIDITY ROLL FORWARD1 6/30/22 DEBT SNAPSHOT 1,200 250+ MM (200+) MM (MM) 800+ MM 900 Revolving Credit Facility (RCF) 0 740 MM 7.125% Senior…
  33. 2Q22 Earnings Presentation – California Resources Corp. – slide 33
    Adjusted EBITDAX Reconciliation We define adjusted EBITDAX as earnings before interest expense; income taxes; depreciation, depletion and amortization; exploration expense; other unusual, infrequent and out-of-period items; and other…
  34. 2Q22 Earnings Presentation – California Resources Corp. – slide 34
    Leverage Ratio & Net Debt Reconciliations Leverage Ratio and Net Debt FY 2022E (MM) Low High We calculate the leverage ratio by dividing net debt by adjusted EBITDAX for the applicable period. We define net debt as the face value of…
  35. 2Q22 Earnings Presentation – California Resources Corp. – slide 35
    Free Cash Flow & Adjusted General & Administrative Expenses Reconciliations Free Cash Flow Management uses free cash flow, which is defined by us as net cash provided by operating activities after our internal capital investment, as a…
  36. 2Q22 Earnings Presentation – California Resources Corp. – slide 36
    Joanna Park (Investor Relations) Richard Venn (Media) 818-661-3731 818-661-6014 Joanna.Parkcrc.com Richard.Venncrc.com

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