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3Q 2022 Earnings Presentation – California Resources Corp.

California Resources Corp. · Nov 4, 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. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 1
    Low Carbon Intensity Fuel for Today and Net Zero Fuel for The Future Third Quarter 2022 Results November 3, 2022
  2. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 2
    Presenters Mac McFarland President & Chief Executive Officer Francisco Leon EVP & Chief Financial Officer 2
  3. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 3
    Continuing to Define CRCs Transition to a Different Kind of Energy Company Delivering Consistent & Predictable Free Cash Flow Generated 644MM of Adj. EBITDAX1 and 272MM of Free Cash Flow1 in 2022 Monetized 79MM in divestitures YTD…
  4. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 4
    Third Quarter 2022 Operational & Financial Results
  5. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 5
    3Q22 Highlights 92 MBOE/D 235MM 286MM 3Q22 NET PRODUCTION 3Q22 OPERATING CASH FLOW TOTAL SHAREHOLDER RETURN 2 60% 13% 27% 107 128 39 247 1 Oil NGLs Gas Capex Free Cash Flow Dividend SRP Increased the RBL Commitment by 50MM in…
  6. 3Q 2022 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 3Q22 physical crude realizations moved lower Q/Q in (amounts shown as % of U.S. domestic GDP)…
  7. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 7
    Focus on Maintaining Margin to Offset Rising Energy Costs and Inflation 4Q21 1Q22 2Q22 3Q22 Natural gas markets drove cost increases primarily in electricity generation and, to a lesser extent, steamflood operations, which Energy…
  8. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 8
    Quickly Adjusting Asset Portfolio to Address California Dynamics OPERATIONAL UPDATE: 65 CRC IS MAINTAINING OIL PRODUCTION CRC Net Oil Production (MBO/D) In 3Q22, ran 5 out of 7 active drilling rigs1 in California and 33 maintenance…
  9. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 9
    Reaffirmed 2022E Corporate Adj. EBITDAX1 and FCF1 Guidance Based on Commodity Outlook 4Q 2022 FY 2022 CRC GUIDANCE2 E&P, Corp. & Other CMB 4Q 22E E&P, Corp. & Other CMB FY22E Total Production3 (MBOE/D) 93 91 93 91 94 91 94 91 Oil…
  10. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 10
    Trends We See for 2023 Preliminary 2023 Details Forecasting a higher facilities/CMB capital deployment to meet regulatory requirements in order to prepare reservoirs for Carbon TerraVault / CO2 Injection As legacy hedges1 roll…
  11. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 11
    Disciplined Capital Allocation Underpins Shareholder Returns Strategy
  12. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 12
    Disciplined Capital Allocation Underpins Robust Shareholder Return Strategy 2022 FREE CASH FLOW1 GENERATION 150 Free Cash Flow1 (MM) 100 50% Reinvestment or Less 128 Large base of low decline assets provides stable base 50…
  13. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 13
    Prioritizing Shareholder Returns REPURCHASED 13% OF THE SHARES THAT CRC ISSUED AT EMERGENCE FROM BANKRUPTCY2 Previous SRP Program 31% Increase in SRP Updated SRP Program 148 276 426 Increasing Share Repurchase Program to 850MM…
  14. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 14
    Advancing & Accelerating Carbon Management Business
  15. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 15
    Evolving with the Energy Transition Increased Incentives Driving Energy Transition Commercial CCS Facilities Worldwide Technology Operation Suspended Indications of further tightening of LCFS market. 1 CARB is expected to release…
  16. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 16
    Expanding the Pie With the New Energy Economy Future Evolution of CAs Emissions2 Carbon TerraVault 150 - 210 Positioned to Be Californias Premier Carbon Management Provider MMTPA or more DAC and Others Californias Potential…
  17. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 17
    Ongoing Discussions With Multiple Emitter Types Project Type1 Tech Greenfield Existing Sources Refiners, Cement, Steam Renewable Generators and Natural Gas Existing Emissions Type of Emitter DAC Ammonia Hydrogen Ethanol Sources2…
  18. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 18
    CTV JV Presenting Three Additional Assets JV Carbon TerraVault JV (CTV JV) 26R1 Initial Payment Milestone 2 Milestone 3 Brookfield 49% Capital Call For Brookfield 46MM Brookfield 46MM Brookfield 46MM Project Development…
  19. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 19
    Summary Delivering Consistent & Predictable Free Cash Flow Disciplined Capital Allocation Underpins Robust Shareholder Return Strategy Advancing & Accelerating Carbon Management Business Leading Strategic CCS…
  20. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 20
    Supplemental Materials
  21. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 21
    Exploring Technologies to Further Advance Net Zero Energy Pathways Est. 6MW of Geothermal Opportunities in SJB Partnering with ICE Thermal Harvesting (ICE), who was awarded a 2MM Wells of Opportunity grant from the DOE Provides an…
  22. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 22
    Expected Quarterly Pricing and Timing in 23 Should Remain Consistent with 22 Cashflow Trends Cash Inflow Drivers: Natural gas basis differential and power prices/NGLs Merchant Electricity Cash Flow Sensitivity (% of 2022E) seasonality…
  23. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 23
    Strategic Partnership Strategic Partnership Carbon TerraVault Joint Venture (CTV JV) Details Global Transition Fund (BGTF) Initial Commitment1 Wholly Owned by CRC 500MM (With Potential for Follow-on Contribution of 10/MT on…
  24. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 24
    Strategic Partnership A Structural Capital Advantage Illustrative 2027 CO2 Storage/Injection Goal Capital Funding Needs1 JV (5MMTPA of CO2 Injection by 2027) Improves & Increases Flexibility of CRCs Est. Capital Required Est.…
  25. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 25
    CTV Project Economic Type Curve Potential Economic Incentives1 Example Strategic Partnership Project Cash Flow Profile3 FEDERAL 45Q TAX CREDIT Terminal 85 (2026) Value (per MT of CO2) for Carbon Storage Target Year 1 Year 2 Year 3…
  26. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 26
    Large Opportunity Set With a Variety of Potential Emitters STORAGE ONLY PROJECTS CTV JV is the off-taker of CO2 at storage site through Storage Co. Illustrative EBITDA1 vs CAPEX Requirements for Various Lower expected capital…
  27. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 27
    CTV JV Creates Value & De-risks Project Funding Requirements Illustrative Strategic Partnership Transaction Bridge Illustrative Assumptions: GROSS PROJECT VALUATION CRC PROJECT VALUATION 100% Ownership 51% Ownership (Mid-High…
  28. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 28
    Potential CTV JV Valuation Upside Targeting 465MM of EBITDA1 by 2028 CTV JV EBITDA1 Potential Assuming midpoint of the CTV Project Economic Type Curve on page 10 2026E 2028E Est. CO2 Injection Rate per Year 1MMTPA 5MMTPA 600 Est.…
  29. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 29
    Hedging Program OIL HEDGES1 Date as of September 30, 2022 4Q22 1Q23 2Q23 3Q23 4Q23 2024 Barrels per Day 25,167 18,322 17,837 17,363 5,747 STRATEGY SOLD CALLS Weighted- CRCs hedging strategy is focused on supporting capital…
  30. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 30
    Maintaining Balance Sheet Strength, Liquidity, and Financial Flexibility ESTIMATED LIQUIDITY ROLL FORWARD1 9/30/22 NET DEBT SNAPSHOT 1,200 70+ MM (80+) MM (MM) 809+ MM 819 MM 900 Revolving Credit Facility (RCF)1 0 7.125% Senior…
  31. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 31
    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…
  32. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 32
    Adjusted EBITDAX Reconciliation (Cont.) 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…
  33. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 33
    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…
  34. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 34
    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…
  35. 3Q 2022 Earnings Presentation – California Resources Corp. – slide 35
    Free Cash Flow & Adjusted General & Administrative Expenses Reconciliations (Cont.) 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,…
  36. 3Q 2022 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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