Americas/United States Equity Research Oil & Gas Exploration & Production Research Analysts Mark Lear, CFA 212 538 0239 mark.lear@credit-suisse.com Edward Westlake 212 325 6751 edward.westlake@credit-suisse.com Venkatesh Duvvuri 212 325 6994 venkatesh.duvvuri@credit-suisse.com Tom Hughes 212 538 8448 thomas.hughes@credit-suisse.com Veronica Liu 212 325 5334 qi.liu@credit-suisse.com Ben Combes, CFA 212 538 2383 ben.combes@credit-suisse.com Chandra Meenaga 212 538 2439 chandra.meenaga@credit-suisse.com U.S. Independent E&Ps WEEKLY ANALYSIS Weekly Upstream Monitor Beta On. The XOP was up 6% this week fueled by constructive comments out of OPEC and the inevitability of Winter driving appetite for oil beta (with the Bakken outperforming the Permian) and for gas equity. This week we got the first long term update from NBL in three years, and while US onshore oil growth was better than we expected, it gave back all its outperformance vs the XOP over the past month and then some, with some investors raising inventory concerns. We spent a couple of days with EGN management this week in NYC, and expect an increasing investor focus on the stock ahead of a growth inflection point starting in 2017, which we do not think is being properly reflected in the valuation. 3Q Production and Capex Revisions. We exit 3Q16 earnings with corporates providing a more constructive view on longer term oil and gas fundamentals despite the uncertainty surrounding upcoming OPEC deliberations. In terms of headline numbers specific to the quarter, we note that overall volumes were largely in-line to slightly ahead, coming in ~1.7% above consensus expectations, while volumetrically the beats were mainly driven by NGL and gas as oil production came in 1.0% above ours and 0.7% above consensus expectations, while gas volumes were a 1.4% beat relative to our estimates and 1.0% above consensus, and finally NGLs came in 5.9% above our estimates and 4.7% above consensus. Accounting for volumes associated with recent asset sales, our 2016 and 2017 production estimates remain largely unchanged, but given the lagged response time between activity picking up and production coming online, forecasted outspends have widened, especially in 2017. In 2016 at the strip, we expect our coverage universe to outspend cash flow by 19%, and by 15% in 2017. Wells of the Week A Closer Look at the Northern Powder River Basin Hotspot. Following our review of the Southern PRB Hotspot (Link: Wells of the Week Looking Into CHK's LT Oil Growth Driver), we wanted to take a closer look at the northern PRB hotspot, located near the Campbell Converse county line, as this play has been increasingly discussed by public operators such as EOG and DVN during 3Q earnings. DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, LEGAL ENTITY DISCLOSURE AND THE STATUS OF NON-US ANALYSTS. US Disclosure: Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.
Table of contents Equity Performance: E&P Rally Continues 6 Weekly Topics 9 3Q16 Earnings Review... 9 NBL US Onshore Long-Term Outlook Update... 21 Wells of the Week A Closer Look at the Northern Powder River Basin Hotspot 26 Valuation Snapshot 34 Implied Oil and Gas Prices... 34 Hedging... 43 Oil... 43 Gas... 44 Oil and NGL Macro... 45 Gas Macro... 46 Focus on Capex and Costs... 47 Appendix: Other Useful Statistics... 54 Rig Count... 65 U.S. Independent E&Ps 2
Table of Exhibits Figure 1: Equity Performance by Basin - Week up to 11/17/16... 6 Figure 2: Equity Performance by Market Capitalization CS E&P Universe Week up to 11/17/16... 6 Figure 3: Equity Performance YTD... 7 Figure 4: Equity Performance Week up to 11/17/16... 7 Figure 5: Short Interest (As of Last Settlement Date 11/09/16)... 8 Figure 6: 3Q16 Production Estimates - Actuals vs Estimates... 10 Figure 7: 3Q16 Oil Production Estimates - Actuals vs Estimates... 11 Figure 8: 3Q16 Gas Production Estimates - Actuals vs Estimates... 12 Figure 9: 3Q16 US Gas Production - Actuals vs Estimates... 13 Figure 10: 3Q16 NGL Production Estimates - Actuals vs Estimates... 14 Figure 11: CS Production Volume Estimate Changes (Mboe/d)... 15 Figure 12: CS US Oil Production Estimate Changes (Mbbl/d)... 16 Figure 13: CS US Gas Production Volume Estimate Changes (Mmcf/d)... 17 Figure 14: CS Capex Estimate Changes ($MM)... 18 Figure 15: CS Cash Flow Estimate Changes at the CS Deck ($MM)... 19 Figure 16: 2016 & 2017 Outspends at the Strip... 20 Figure 17: 3rd Bone Spring Production and Cume... 22 Figure 18: CXO 3Q16 3rd Bone Spring Results... 22 Figure 19: NBL Delaware Completions and CXO 3 rd Bone Spring Locations... 22 Figure 20: NBL Delaware Basin Type Curves (7,500 ft lateral)... 23 Figure 21: NBL vs. ROSE Well Result Evolution and Completion Design... 23 Figure 22: NBL vs. ROSE Well Performance... 24 Figure 23: NBL DJ Well Design Evolution and Production Results... 25 Figure 24: NBL East Pony Well Results by Vintage... 25 Figure 25: NBL Wells Ranch Well Results by Vintage... 25 Figure 26: DJ and PRB Hotspots... 26 Figure 27: Drillable Formations in the PRB... 26 Figure 28: IRR by Drilling Zones... 26 Figure 29: Historic Turner by Peak Oil (2013+)... 27 Figure 30: Significant GOR Shift Seen within A Few Miles... 27 Figure 31: Historical Turner Wells with Oil Cut Below 40%... 28 Figure 32: Historical Turner Wells with Oil Cut Between 40% and 60%... 28 Figure 33: Historical Turner Wells with Oil Cut Between 60% and 80%... 28 Figure 34: Historical Turner Wells with Oil Cut Above 80%... 28 Figure 35: DJ GOR Map... 29 Figure 36: Southern PRB Hotspot GOR Map... 29 U.S. Independent E&Ps 3
Figure 37: GOR Shift Over Life of Well for Turner Wells... 29 Figure 38: Turner Type Curves... 30 Figure 39: Estimated Heat Map Based on Historical Wells... 30 Figure 40: Modeled EOG PRB Type Curve... 31 Figure 41: PRB Wells Historical Cume Production... 31 Figure 42: Outperforming PRB Wells... 31 Figure 43: Sweet Spot of Northern Hotspot Acreage... 32 Figure 44: EOG PRB Acreage Post Yates Acquisition... 32 Figure 45: Vintage Type Curve By Year... 33 Figure 46: Equity Implied Gas Prices As of 11/18/16... 34 Figure 47: Equity Implied Oil Prices As of 11/18/16... 34 Figure 48: E&P Upside/Downside to NAV... 35 Figure 49: E&P Upside/Downside to NAV at CS Deck and Strip... 35 Figure 50: 2016 EV to EBITDA (unhedged at the strip, $45.57/bbl WTI, $2.76/MMbtu)... 36 Figure 51: 2016 EV to EBITDA (hedged at the CS Deck, $42.18/bbl WTI, $2.45/MMbtu gas)... 36 Figure 52: 2017 EV to EBITDA (unhedged at the strip, $48.69/bbl WTI, $3.00/MMbtu)... 37 Figure 53: 2017 EV to EBITDA (hedged at the CS Deck, $55.00/bbl WTI, $3.25/MMbtu gas)... 37 Figure 54: 2018 EV to EBITDA (unhedged at the strip, $50.83/bbl WTI, $2.94/MMbtu)... 38 Figure 55: 2018 EV to EBITDA (hedged at the CS Deck, $62.50/bbl WTI, $3.50/MMbtu gas)... 38 Figure 56: Debt Adjusted Cash Flow Per Share (2015 2018E)... 39 Figure 57: 2016 Net Debt to EBITDA... 39 Figure 58: 2017 Net Debt to EBITDA... 40 Figure 59: Net Debt (as a % of EV)... 41 Figure 60: 2016 Outspend at the CS Deck ($42.18 WTI/$2.45 NYMEX)... 42 Figure 61: 2017 Outspend at the CS Deck ($55.00 WTI/$3.25 NYMEX)... 42 Figure 62: 2016 Oil Volumes Hedged... 43 Figure 63: 2017 Oil Volumes Hedged... 43 Figure 64: 2016 Gas Volumes Hedged... 44 Figure 65: 2017 Gas Volumes Hedged... 44 Figure 66: Regional Oil Differentials to WTI - As of 11/18/16... 45 Figure 67: NGL Composite Prices (at Mt. Belvieu) - As of 11/18/16... 45 Figure 68: US Natural Gas Storage - As of 11/11/16... 46 U.S. Independent E&Ps 4
Figure 69: Select Northeast Gas Price Differential to Henry Hub - As of 11/18/1646 Figure 70: 2016 and 2017 Capex per boe... 47 Figure 71: 2015 2017 Cash Costs per boe... 47 Figure 72: Large Cap Oil Headline Cashflow Cash Margins - Hedged ($/boe, 2015-2018)... 48 Figure 73: SMID Cap Oil Headline Cashflow Cash Margins - Hedged ($/boe, 2015-2018)... 48 Figure 74: Gas Cash Margins ($/Mcfe, 2015-2018)... 49 Figure 75: Historical Lease Operating Expense ($/boe)... 50 Figure 76: Texas Well Completions (1 of 3) Week up to 11/18/2016... 51 Figure 77: Texas Well Completions (2 of 3) Week up to 11/18/2016... 52 Figure 78: Texas Well Completions (3 of 3) Week up to 11/18/2016... 53 Figure 79: CS Coverage Comp Sheet (As of 11/18/2016)... 54 Figure 80: 2016 and 2017 Revenue per boe... 55 Figure 81: 2016 and 2017 EBITDAX per boe... 55 Figure 82: 2017 EBITDAX/boe vs. % oil (at Credit Suisse deck)... 56 Figure 83: Total Oil Production (Mbbl/d)... 57 Figure 84: Oil Growth %... 58 Figure 85: 2015 2018E US Onshore Oil Volumes (Mbbl/d)... 59 Figure 86: Total Gas Production (MMcf/d)... 60 Figure 87: Total NGL Production (bbl/d)... 61 Figure 88: 2015 2018E Capex Estimates... 62 Figure 89: 2015 2018E Cash Flow Estimates... 63 Figure 90: Leading Edge Completion Tracker... 64 Figure 91: Total US Rig Count by Basin As of 11/18/16... 65 Figure 92: Weekly US Horizontal Rig Count (As of 11/18/2016)... 66 Figure 93: US Weekly Natural Gas v. Oil Rig Count... 66 Figure 94: US Crude Oil Storage Week of 11/11/16... 67 U.S. Independent E&Ps 5
-71% -37% -31% -31% -28% -9% -3% -4% -7% -9% -7% -1% 0% 4% 3% 6% 3% 1% 0% 15% 11% 8% 11% 8% 18% 14% 15% 10% 28% 26% -59% -48% -52% -52% -40% -37% -29% -28% -19% -16% -5% -8% -13% -2% -4% -4% -5% -7% -5% -5% -7% -1% 1% 7% 4% 3% 6% 3% 3% 1% 0% 7% 3% 8% 8% 3% 3% 9% 15% 17% 24% 14% 30% 27% 22% 21% 18% 15% 11% 15% 10% 30% 26% 39% 39% 34% 43% 51% 47% 59% 18 November 2016 Equity Performance: E&P Rally Continues Figure 1: Equity Performance by Basin - Week up to 11/17/16 2015 2016YTD 2016 1Q 2016 2Q 2016 3Q 2016 4QTD 80% 60% 40% 20% 0% -20% -40% -60% -80% Source: Thomson Reuters, Credit Suisse estimates Figure 2: Equity Performance by Market Capitalization CS E&P Universe Week up to 11/17/16 2015 2016YTD 2016 1Q 2016 2Q 2016 3Q 2016 4QTD 40% 20% 0% -20% -40% -60% -80% Source: Thomson Reuters, Credit Suisse estimates U.S. Independent E&Ps 6
-150% -100% -50% 0% 50% 100% 150% 200% 250% 300% -35% -30% -25% -20% -15% -10% -5% 0% 5% 10% 15% 20% 18 November 2016 Figure 3: Equity Performance YTD Figure 4: Equity Performance Week up to 11/17/16 CWEI CNX ECA WPX CLR RICE UPL PE LPI SM CPE BBG OAS RSPP AREX SN DNR ECR FANG SWN XEC CXO PXD RRC APA EGN MUR DVN CHK EOG QEP EQT APC PDCE MRO CRZO COG NFX AR NBL HES JONE OXY GPOR XOG. WLL SYRG EPE COP KOS CRK GST WTI NOG TPLM REXX CIE HK BCEI EXXI EOX SGY WRES -0.5% -2.4% -3.3% -4.2% -4.8% -6.6% -8.5% -10.5% -14.5% -33.8% -54.7% -66.9% -73.2% -76.7% -77.8% -81.0% -87.1% -89.3% -89.4% -96.9% 129.0% 122.2% 120.7% 116.0% 113.3% 100.8% 85.1% 75.6% 72.6% 72.4% 69.5% 63.4% 63.0% 60.9% 58.9% 48.5% 46.7% 46.4% 45.9% 40.7% 40.5% 40.3% 38.3% 38.1% 37.6% 35.0% 34.0% 30.9% 30.4% 29.9% 28.3% 26.5% 23.5% 22.8% 22.6% 22.3% 22.2% 12.8% 7.3% 4.2% 1.3% 0.3% 274.4% EPE JONE AREX HK MUR ECA CLR CHK GST CIE XCO WLL LPI SM BCEI RRC APA HES TPLM BBG SN SWN UPL NFX XOG. RICE RICE WPX DNR CWEI OXY PDCE ECR MRO CPE EGN OAS KOS CXO FANG DVN GPOR PXD EQT CRK QEP COG PE SYRG XEC APC RSPP CNX AR WRES CRZO COP WTI NBL NOG EXXI SGY REXX -28.1% -11.6% -0.4% -0.8% -1.3% -2.2% -2.8% -4.4% 15.2% 13.0% 13.0% 11.4% 10.5% 10.3% 9.3% 8.5% 7.7% 7.7% 7.6% 7.4% 6.9% 6.7% 6.6% 6.4% 6.4% 6.1% 5.9% 5.9% 5.9% 5.4% 5.2% 5.2% 5.1% 5.1% 5.1% 5.1% 4.9% 4.6% 4.4% 4.2% 3.9% 3.8% 3.7% 3.0% 3.0% 2.8% 2.8% 2.5% 2.4% 2.4% 2.2% 1.8% 1.7% 1.7% 1.4% 1.3% 1.1% 1.0% 0.7% 0.6% 0.5% 0.1% 0.0% Source: Thomson Reuters, Credit Suisse estimates Source: Thomson Reuters, Credit Suisse estimates U.S. Independent E&Ps 7
Figure 5: Short Interest (As of Last Settlement Date 11/09/16) % Short Interest Days to Cover 45% 40% 16 14 Percentage Short Interest 35% 30% 25% 20% 15% 10% 5% 0% 39% 27% 25% 24% 21% 20% 17% 16% 16% 16% 15% 14% 14% 12% 12% 10% 9% 8% EPE SYRG CLR WLL DNR SN OAS CHK CIE CRZO CPE MUR LPI PDCE SWN PE KOS GPOR HES XOG FANG MRO AR CXO APA EQT RRC EGN NFX PXD NBL OXY APC DVN EOG 8% 7% 6% 6% 6% 6% 5% 5% 4% 4% 4% 4% 3% 2% 2% 2% 2% 12 10 8 6 4 2 0 Days to Cover Source: the BLOOMBERG PROFESSIONAL service U.S. Independent E&Ps 8
Weekly Topics 3Q16 Earnings Review We exit 3Q16 earnings with corporates providing a more constructive view on longer term oil and gas fundamentals despite the uncertainty surrounding upcoming OPEC deliberations. Operationally, notable big cap names including NBL and EOG offered up Delaware type curve bumps to accommodate longer lateral drilling plans. Companies continue to highlight cash flow neutrality and long term double digit production CAGRs, which is underpinned by modest rig adds as efficiency gains on the drilling side help to offset the expected mild pricing pressure on completions. In terms of headline numbers specific to the quarter, we note that overall volumes were largely in-line to slightly ahead, coming in ~1.7% above consensus expectations (Figure 6), while volumetrically the beats were mainly driven by NGL and gas as oil production came in 1.0% above ours and 0.7% above consensus expectations (Figure 7), while gas volumes were a 1.4% beat relative to our estimates and 1.0% above consensus, and finally NGLs came in 5.9% above our estimates and 4.7% above consensus. Accounting for volumes associated with recent asset sales, our 2016 and 2017 production estimates remain largely unchanged (Figure 11), but given the lagged response time between activity picking up and production coming online, forecasted outspends have widened, especially in 2017. In 2016 at the strip, we expect our coverage universe to outspend cash flow by 19%, and by 15% in 2017. U.S. Independent E&Ps 9
Figure 6: 3Q16 Production Estimates - Actuals vs Estimates Total Production (Mboe/d) Ticker: Actual CS Estimate Diff (Mboe/d) % Diff Consensus Diff (Mboe/d) % Diff COP 1556.5 1540.8 15.7 1.0% 1528.0 28.5 1.9% APC 779.8 761.0 18.8 2.5% 753.6 26.2 3.5% CHK 638.0 610.7 27.3 4.5% 618.6 19.4 3.1% OXY 605.0 606.8-1.8-0.3% 590.3 14.7 2.5% DVN 575.7 573.2 2.4 0.4% 577.8-2.1-0.4% EOG 555.2 542.3 12.9 2.4% 542.6 12.5 2.3% APA 438.6 437.6 1.0 0.2% 508.6-70.0-13.8% NBL 425.8 417.8 8.0 1.9% 416.3 9.5 2.3% MRO 400.0 385.3 14.7 3.8% 390.2 9.8 2.5% SWN 381.6 385.7-4.2-1.1% 381.7-0.1 0.0% EQT 355.2 338.6 16.6 4.9% 338.4 16.9 5.0% HES 313.7 313.6 0.1 0.0% 313.3 0.4 0.1% AR 312.5 309.6 2.9 0.9% 303.9 8.5 2.8% RRC 251.4 250.7 0.7 0.3% 248.0 3.4 1.4% PXD 238.9 237.4 1.5 0.6% 236.8 2.1 0.9% CLR 207.8 202.7 5.1 2.5% 209.2-1.3-0.6% MUR 169.8 168.4 1.5 0.9% 169.7 0.2 0.1% NFX 165.6 156.6 9.0 5.7% 157.2 8.4 5.3% CXO 152.9 147.4 5.5 3.7% 148.3 4.6 3.1% GPOR 122.4 117.6 4.8 4.1% 122.1 0.3 0.2% WLL 119.9 117.4 2.5 2.1% 118.0 1.9 1.6% EPE 79.6 75.0 4.6 6.1% 76.2 3.4 4.5% PDCE 65.3 63.2 2.1 3.3% 61.5 3.8 6.2% EGN 56.6 55.5 1.1 1.9% 55.6 1.0 1.8% SN 51.5 53.6-2.1-3.9% 52.5-0.9-1.8% LPI 51.3 48.9 2.3 4.8% 48.8 2.5 5.0% OAS 48.5 49.2-0.7-1.4% 48.6-0.1-0.3% FANG 44.9 45.9-1.0-2.2% 44.5 0.4 0.9% PE 43.0 40.0 3.0 7.4% 40.5 2.5 6.3% CRZO 40.8 39.9 0.9 2.2% 40.1 0.7 1.7% XOG 28.9 28.1 0.8 3.0% 28.1 0.8 3.0% CPE 16.6 16.8-0.2-0.9% 16.6 0.0 0.2% SYRG 10.8 11.0-0.2-1.9% 10.8 0.0-0.2% Total (Mboe/d): 9304 9148 156 1.7% 9196 108 1.2% U.S. Independent E&Ps 10
Figure 7: 3Q16 Oil Production Estimates - Actuals vs Estimates Oil Production (Mbbl/d) Ticker: Actual CS Estimate Diff (Mbbl/d) % Diff Consensus Diff (Mbbl/d) % Diff COP 927.0 902.3 24.7 2.7% 871.9 55.1 6.3% OXY 371.0 384.0-13.0-3.4% 384.7-13.7-3.6% APC 317.0 304.6 12.4 4.1% 305.3 11.7 3.8% EOG 282.6 276.7 5.9 2.1% 281.2 1.4 0.5% MRO 266.0 255.0 11.0 4.3% 252.8 13.2 5.2% DVN 251.0 246.0 5.0 2.0% 248.0 3.0 1.2% APA 217.6 224.2-6.7-3.0% 271.1-53.6-19.8% HES 190.0 184.7 5.3 2.9% 184.6 5.4 2.9% PXD 134.2 139.4-5.2-3.7% 138.0-3.8-2.8% NBL 123.0 118.2 4.8 4.1% 117.5 5.5 4.7% CLR 116.3 124.2-7.9-6.4% 126.1-9.8-7.8% MUR 108.9 103.8 5.1 4.9% 97.4 11.5 11.8% CXO 91.1 91.7-0.5-0.6% 91.7-0.5-0.6% CHK 86.6 89.4-2.8-3.2% 89.3-2.7-3.1% WLL 84.3 83.1 1.2 1.5% 82.9 1.5 1.8% NFX 69.6 66.7 2.9 4.3% 67.6 1.9 2.9% EPE 45.0 43.7 1.3 2.9% 44.0 1.0 2.3% OAS 39.4 40.8-1.3-3.3% 39.8-0.3-0.8% EGN 35.8 35.9-0.1-0.3% 35.9 0.0-0.1% FANG 32.6 33.5-0.9-2.7% 32.5 0.1 0.3% PE 29.0 27.3 1.8 6.4% 27.3 1.7 6.4% PDCE 25.4 25.2 0.3 1.0% 24.1 1.3 5.6% CRZO 24.5 24.4 0.1 0.3% 24.5 0.0 0.0% LPI 23.4 23.1 0.2 1.1% 22.6 0.8 3.6% SN 17.0 17.4-0.4-2.6% 17.1-0.1-0.9% XOG 14.0 14.5-0.5-3.5% 14.5-0.5-3.5% CPE 12.5 12.9-0.3-2.6% 12.8-0.3-2.0% RRC 8.8 9.5-0.6-6.9% 9.5-0.7-7.4% SWN 5.8 6.1-0.2-3.8% 5.9-0.1-1.9% GPOR 5.7 5.8-0.1-1.5% 5.7-0.1-1.2% SYRG 5.6 5.5 0.1 2.2% 5.5 0.1 1.9% AR 4.6 5.0-0.4-7.9% 4.6 0.0-0.7% EQT 2.0 2.3-0.2-9.5% 2.3-0.3-11.7% Total (Mbbl/d): 3968 3927 41 1.0% 3939 29 0.7% U.S. Independent E&Ps 11
Figure 8: 3Q16 Gas Production Estimates - Actuals vs Estimates 10/13/2016 Total Gas (MMcf/d) Ticker: Actual CS Estimate Diff (MMcf/d) % Diff Consensus Diff (MMcf/d) % Diff COP 3777.0 3830.9-53.9-1.4% 3856.4-79.4-2.1% CHK 2914.0 2756.5 157.5 5.7% 2770.2 143.8 5.2% SWN 2054.3 2085.8-31.4-1.5% 2072.5-18.1-0.9% APC 2003.0 2008.6-5.6-0.3% 1946.4 56.6 2.9% EQT 1904.3 1841.0 63.3 3.4% 1834.7 69.5 3.8% NBL 1445.0 1437.7 7.3 0.5% 1441.3 3.7 0.3% AR 1386.0 1411.0-25.0-1.8% 1383.9 2.1 0.2% DVN 1324.0 1301.4 22.6 1.7% 1303.0 21.0 1.6% EOG 1144.0 1128.4 15.6 1.4% 1124.8 19.2 1.7% RRC 1015.9 976.8 39.1 4.0% 973.0 42.9 4.4% APA 934.8 925.2 9.6 1.0% 1075.7-140.9-13.1% OXY 888.0 862.8 25.2 2.9% 818.7 69.3 8.5% MRO 804.0 782.0 22.0 2.8% 792.5 11.5 1.5% GPOR 632.1 623.4 8.6 1.4% 632.3-0.2 0.0% CLR 549.4 471.3 78.1 16.6% 502.4 46.9 9.3% HES 472.0 515.8-43.8-8.5% 511.9-39.9-7.8% NFX 387.0 369.6 17.4 4.7% 366.0 20.9 5.7% MUR 382.0 387.1-5.2-1.3% 391.7-9.7-2.5% CXO 370.6 334.4 36.2 10.8% 338.4 32.2 9.5% PXD 332.4 340.5-8.1-2.4% 342.0-9.6-2.8% PDCE 145.8 150.4-4.6-3.0% 146.7-0.9-0.6% EPE 121.0 106.6 14.4 13.5% 116.5 4.5 3.9% SN 115.2 119.8-4.7-3.9% 120.4-5.3-4.4% WLL 107.7 105.7 2.0 1.9% 109.3-1.6-1.4% LPI 84.4 76.9 7.5 9.7% 80.2 4.2 5.3% CRZO 69.3 65.3 3.9 6.0% 66.3 3.0 4.5% EGN 62.0 62.1-0.2-0.3% 61.2 0.8 1.2% OAS 54.4 50.5 3.9 7.8% 53.1 1.4 2.6% XOG 52.1 47.4 4.7 9.9% 47.4 4.7 9.9% PE 38.6 37.1 1.5 4.1% 38.5 0.1 0.3% SYRG 31.0 33.0-2.0-6.0% 31.0 0.0 0.1% FANG 29.1 35.8-6.8-18.9% 33.6-4.5-13.5% CPE 24.4 23.3 1.1 4.6% 23.0 1.4 5.9% Total (MMcf/d): 25,655 25,305 350 1.4% 25,405 250 1.0% U.S. Independent E&Ps 12
Figure 9: 3Q16 US Gas Production - Actuals vs Estimates US Gas (MMcf/d) Ticker: Actual CS Estimate Diff (MMcf/d) % Diff CHK 2914.0 2756.5 157.5 5.7% SWN 2054.3 2085.8-31.4-1.5% APC 2003.0 2008.6-5.6-0.3% EQT 1904.3 1904.3 0.0 0.0% AR 1386.0 1411.0-25.0-1.8% DVN 1306.0 1285.4 20.6 1.6% COP 1242.0 1248.3-6.3-0.5% NBL 1204.0 1238.7-34.7-2.8% RRC 1015.9 1015.9 0.0 0.0% EOG 791.0 762.6 28.4 3.7% GPOR 632.1 623.4 8.6 1.4% CLR 549.4 471.3 78.1 16.6% APA 395.1 390.0 5.1 1.3% NFX 387.0 369.6 17.4 4.7% CXO 370.6 334.4 36.2 10.8% OXY 349.0 313.8 35.2 11.2% PXD 332.4 340.5-8.1-2.4% MRO 315.0 295.0 20.0 6.8% HES 270.0 252.1 17.9 7.1% PDCE 145.8 150.4-4.6-3.0% EPE 121.0 106.6 14.4 13.5% SN 115.2 119.8-4.7-3.9% WLL 107.7 105.7 2.0 1.9% LPI 84.4 76.9 7.5 9.7% CRZO 69.3 65.3 3.9 6.0% EGN 62.0 62.1-0.2-0.3% OAS 54.4 50.5 3.9 7.8% XOG 52.1 47.4 4.7 9.9% MUR 51.8 52.0-0.2-0.5% PE 38.6 37.1 1.5 4.1% SYRG 31.0 31.0 0.0 0.0% FANG 29.1 35.8-6.8-18.9% CPE 24.4 23.3 1.1 4.6% Total (MMcf/d): 20,408 20,071 336 1.7% U.S. Independent E&Ps 13
Figure 10: 3Q16 NGL Production Estimates - Actuals vs Estimates NGL Production (Mbbl/d) Ticker: Actual CS Estimate Diff (Mbbl/d) % Diff Consensus Diff (Mbbl/d) % Diff APC 129.0 121.6 7.4 6.1% 123.8 5.2 4.2% DVN 104.0 110.4-6.4-5.8% 110.2-6.2-5.6% OXY 86.0 79.0 7.0 8.9% 83.0 3.0 3.6% EOG 81.9 77.6 4.3 5.6% 78.8 3.1 3.9% AR 76.9 69.4 7.4 10.7% 69.9 6.9 9.9% RRC 73.3 78.4-5.2-6.6% 76.2-2.9-3.8% CHK 65.7 61.8 3.9 6.3% 67.0-1.3-1.9% APA 65.2 59.1 6.1 10.3% 59.5 5.7 9.6% NBL 62.0 60.0 2.0 3.3% 59.0 3.0 5.1% PXD 49.2 41.2 8.0 19.4% 41.3 7.9 19.2% HES 45.0 42.9 2.1 4.9% 42.4 2.6 6.1% EQT 35.8 29.5 6.3 21.3% 30.8 5.0 16.1% SWN 33.3 32.0 1.3 4.1% 30.7 2.6 8.5% NFX 31.5 28.3 3.2 11.4% 28.4 3.2 11.1% WLL 17.6 16.7 0.9 5.6% 17.0 0.6 3.5% PDCE 15.5 13.0 2.6 19.7% 12.8 2.8 21.7% SN 15.3 16.2-0.8-5.2% 15.3 0.0 0.1% EPE 14.4 13.5 0.9 6.8% 13.0 1.4 10.8% LPI 13.8 13.0 0.8 6.5% 12.9 0.9 7.2% GPOR 11.3 7.9 3.4 43.4% 10.8 0.5 5.1% EGN 10.4 9.2 1.2 13.1% 9.3 1.1 11.6% PE 7.6 6.6 1.0 14.6% 6.7 0.8 12.2% FANG 7.5 6.4 1.0 16.1% 6.4 1.1 17.6% XOG 6.2 5.7 0.6 9.8% 5.7 0.6 9.8% CRZO 4.7 4.6 0.1 3.0% 4.6 0.1 2.2% Total (Mbbl/d): 1063.3 1004.0 59.3 5.9% 1015.5 47.8 4.7% U.S. Independent E&Ps 14
Figure 11: CS Production Volume Estimate Changes (Mboe/d) 2016 2017 2018 Ticker: Current Previous Diff Current Previous Diff Current Previous Diff COP 1551.6 1558.1 (6.5) 1554.4 1572.7 (18.2) 1562.1 1615.3 (53.1) APC 776.1 794.8 (18.8) 839.4 854.3 (14.9) 886.9 893.5 (6.6) CHK 632.7 625.6 7.1 559.2 548.9 10.4 602.6 543.4 59.1 OXY 632.6 631.5 1.1 658.3 634.8 23.5 760.5 684.8 75.6 DVN 609.3 612.5 (3.1) 552.2 568.5 (16.4) 617.8 637.4 (19.7) EOG 559.2 551.6 7.6 624.9 604.7 20.3 724.4 684.5 39.9 APA 453.5 449.5 4.0 477.0 456.1 21.0 559.9 536.5 23.4 NBL 419.9 416.8 3.1 421.5 421.2 0.3 438.4 435.9 2.5 SWN 399.8 401.9 (2.1) 388.6 400.1 (11.6) 405.1 417.0 (11.9) MRO 386.2 381.6 4.6 404.6 390.0 14.6 440.7 421.5 19.3 EQT 343.2 335.6 7.6 375.9 368.6 7.3 452.5 453.7 (1.2) HES 320.3 325.2 (4.9) 322.4 332.6 (10.2) 349.3 350.4 (1.1) AR 302.7 301.3 1.5 374.0 370.6 3.4 452.4 448.5 3.8 RRC 256.6 257.9 (1.3) 346.3 344.6 1.7 415.6 405.8 9.8 PXD 233.7 233.7 (0.0) 278.9 276.7 2.2 337.2 336.2 1.0 CLR 217.4 214.5 2.9 231.1 226.7 4.3 260.4 258.8 1.6 MUR 174.5 175.2 (0.7) 171.9 171.4 0.5 189.4 183.9 5.6 NFX 162.0 157.3 4.7 156.4 147.4 9.0 179.9 171.8 8.1 CXO 150.9 148.0 2.9 180.0 178.4 1.6 216.3 205.9 10.3 WLL 129.3 128.4 0.9 123.4 118.7 4.7 135.0 130.2 4.8 GPOR 120.1 119.1 1.0 149.9 148.9 1.0 219.7 208.9 10.8 EPE 86.6 84.4 2.2 78.9 72.3 6.6 82.2 73.0 9.3 PDCE 60.4 60.9 (0.5) 85.4 80.5 5.0 109.5 106.2 3.3 EGN 54.8 54.5 0.3 64.6 64.4 0.2 81.0 81.3 (0.2) SN 53.8 54.2 (0.4) 53.9 56.5 (2.6) 59.6 62.4 (2.9) OAS 50.6 49.5 1.1 66.7 52.0 14.7 73.2 58.2 15.0 LPI 49.3 48.0 1.3 55.5 52.4 3.2 60.4 58.4 2.0 CRZO 42.1 41.2 0.9 48.4 44.8 3.6 54.4 50.2 4.2 FANG 41.9 42.1 (0.2) 55.0 54.9 0.1 70.9 70.8 0.1 PE 38.7 37.3 1.4 57.2 54.3 2.8 77.9 74.1 3.7 XOG 29.5 29.0 0.5 59.5 59.0 0.6 83.6 82.3 1.3 CPE 15.5 15.6 (0.1) 22.6 22.4 0.2 30.5 29.3 1.2 SYRG 11.2 11.2 (0.0) 20.2 19.7 0.5 32.9 31.8 1.0 Total: 9366.1 9348.2 17.9 9858.4 9768.9 89.5 11022.0 10801.8 220.2 % Change 0% 1% 2% U.S. Independent E&Ps 15
Figure 12: CS US Oil Production Estimate Changes (Mbbl/d) 2016 2017 2018 Ticker: Current Previous Diff Current Previous Diff Current Previous Diff COP 454.4 458.2 (3.9) 449.9 441.7 8.2 432.7 452.5 (19.8) EOG 275.5 272.3 3.2 322.5 314.8 7.7 395.2 373.8 21.4 APC 229.7 242.7 (13.0) 341.3 335.3 6.0 371.4 358.9 12.5 OXY 189.0 189.8 (0.8) 212.6 209.0 3.6 274.5 245.6 29.0 MRO 170.3 166.5 3.8 177.2 161.5 15.8 214.0 192.6 21.5 PXD 133.2 135.5 (2.3) 172.1 172.5 (0.4) 215.5 216.1 (0.6) CLR 131.4 132.8 (1.3) 151.1 147.6 3.5 173.3 171.9 1.4 DVN 128.7 129.1 (0.4) 108.9 109.5 (0.6) 138.8 141.3 (2.6) HES 122.4 125.9 (3.5) 120.3 126.1 (5.8) 125.7 124.7 1.0 APA 103.7 104.9 (1.1) 100.1 106.3 (6.2) 111.7 127.5 (15.9) NBL 99.7 97.7 2.1 106.9 95.3 11.6 118.0 98.0 20.0 WLL 92.8 92.5 0.3 86.3 83.8 2.5 94.5 92.0 2.5 CXO 92.4 92.8 (0.4) 111.4 115.3 (3.9) 136.2 135.5 0.7 CHK 91.4 91.9 (0.6) 98.6 92.8 5.8 115.3 94.0 21.3 NFX 57.1 57.1 0.0 61.7 63.7 (2.0) 79.4 81.9 (2.6) MUR 55.9 56.0 (0.1) 54.1 56.6 (2.5) 64.1 61.9 2.2 EPE 46.4 45.8 0.5 44.6 42.7 1.9 46.2 43.1 3.2 OAS 41.7 41.3 0.3 53.5 42.8 10.6 58.3 47.2 11.1 EGN 35.0 35.1 (0.1) 42.5 42.2 0.3 53.0 53.7 (0.8) FANG 30.6 30.9 (0.2) 39.9 39.8 0.1 51.4 51.3 0.1 PE 26.0 25.2 0.8 40.4 38.8 1.6 56.8 54.7 2.1 CRZO 25.5 25.3 0.2 31.0 30.0 1.0 35.7 33.9 1.7 PDCE 23.9 24.4 (0.5) 35.6 34.9 0.7 47.4 46.5 1.0 LPI 22.8 22.7 0.2 25.8 25.2 0.6 28.3 28.4 (0.2) SN 17.4 17.5 (0.1) 16.7 17.5 (0.9) 18.3 19.0 (0.6) XOG 14.9 14.5 0.4 31.6 32.8 (1.2) 42.0 43.5 (1.5) CPE 11.9 12.1 (0.2) 17.5 17.5 (0.1) 23.7 22.9 0.8 RRC 9.7 10.0 (0.4) 12.6 11.6 1.0 14.5 11.8 2.7 SWN 6.1 6.2 (0.1) 6.1 6.3 (0.2) 6.8 7.1 (0.3) GPOR 5.9 6.0 (0.1) 4.6 5.2 (0.6) 3.8 4.4 (0.7) SYRG 5.8 5.6 0.1 11.0 10.3 0.6 17.8 16.6 1.2 AR 4.9 5.0 (0.2) 5.0 5.4 (0.4) 5.9 6.4 (0.5) EQT 2.0 2.1 (0.1) 1.9 2.1 (0.2) 1.7 1.8 (0.2) Total: 2758.0 2775.4 (17.4) 3095.1 3037.0 58.1 3572.1 3460.6 111.5 % Change -1% 2% 3% U.S. Independent E&Ps 16
Figure 13: CS US Gas Production Volume Estimate Changes (Mmcf/d) 2016 2017 2018 Ticker: Current Previous Diff Current Previous Diff Current Previous Diff CHK 2845.5 2810.8 34.6 2414.6 2429.2 (14.6) 2556.6 2410.7 145.9 SWN 2157.2 2172.7 (15.5) 2098.8 2171.8 (73.0) 2184.2 2260.1 (75.9) APC 2049.6 2093.2 (43.5) 1739.6 1876.7 (137.1) 1788.5 1915.7 (127.2) EQT 1864.8 1831.6 33.2 2057.1 2015.9 41.2 2497.6 2497.5 0.1 DVN 1391.6 1393.4 (1.7) 1224.8 1260.6 (35.8) 1324.3 1348.8 (24.5) AR 1355.6 1368.0 (12.4) 1655.1 1684.8 (29.7) 2015.5 2051.8 (36.2) COP 1248.2 1250.8 (2.6) 1210.6 1212.9 (2.3) 1079.1 1176.8 (97.7) NBL 1214.4 1240.9 (26.5) 1192.9 1275.3 (82.5) 1245.7 1343.8 (98.1) RRC 1035.5 1023.5 12.0 1451.4 1457.1 (5.8) 1751.0 1767.8 (16.8) EOG 819.5 806.1 13.4 884.4 856.3 28.1 961.6 924.4 37.2 GPOR 623.3 626.5 (3.3) 804.3 813.8 (9.5) 1221.0 1173.1 48.0 CLR 515.6 490.5 25.1 479.9 474.7 5.2 522.5 521.5 1.1 APA 397.4 395.4 2.0 486.7 432.9 53.9 717.3 597.8 119.5 NFX 367.4 360.3 7.1 333.1 322.2 10.9 357.9 346.2 11.7 OXY 352.9 335.9 17.0 368.8 299.7 69.1 482.8 316.2 166.6 CXO 351.3 331.4 19.9 411.5 378.4 33.1 480.5 422.8 57.7 PXD 345.2 345.1 0.1 369.6 360.6 9.0 415.0 411.0 4.0 MRO 311.0 306.1 4.9 318.7 329.1 (10.4) 361.5 378.5 (17.0) HES 258.2 261.7 (3.5) 218.7 246.6 (27.9) 192.0 233.8 (41.8) EPE 156.1 148.2 7.9 121.6 98.8 22.8 128.1 99.8 28.3 PDCE 138.4 144.5 (6.1) 178.7 184.1 (5.4) 221.8 219.0 2.8 SN 119.4 119.5 (0.2) 125.0 123.8 1.1 137.8 135.9 1.9 WLL 111.9 111.0 0.9 112.0 107.2 4.8 122.6 117.6 5.0 LPI 80.4 76.3 4.1 89.0 78.2 10.8 95.2 84.0 11.2 CRZO 70.4 67.9 2.4 69.3 60.5 8.8 73.1 65.8 7.3 EGN 61.4 62.2 (0.8) 65.3 70.3 (5.0) 83.7 85.1 (1.4) OAS 53.7 49.4 4.3 79.4 54.8 24.6 89.3 65.6 23.8 MUR 52.8 57.2 (4.3) 49.7 53.8 (4.1) 50.4 54.5 (4.1) XOG 51.8 49.4 2.4 98.0 92.4 5.6 143.8 135.0 8.8 PE 36.8 36.0 0.8 48.5 46.4 2.1 62.7 60.0 2.7 SYRG 32.8 33.5 (0.8) 55.1 56.3 (1.2) 90.3 91.4 (1.0) FANG 28.7 31.9 (3.3) 37.0 44.2 (7.2) 47.7 57.1 (9.3) CPE 21.3 20.7 0.5 31.1 29.4 1.8 40.6 38.1 2.5 Total: 20520.1 20451.6 68.5 20880.1 20998.7 (118.6) 23542.0 23407.1 134.9 % Change 0% -1% 1% U.S. Independent E&Ps 17
Figure 14: CS Capex Estimate Changes ($MM) 2016 2017 2018 Ticker: Current Previous Diff Current Previous Diff Current Previous Diff COP $5,199 $5,431 ($232) $4,913 $4,864 $48 $5,084 $5,038 $47 APC $3,394 $3,294 $100 $4,129 $4,191 ($62) $4,597 $4,723 ($127) EOG $2,800 $2,600 $200 $4,500 $4,500 $0 $6,000 $6,000 $0 HES $2,339 $2,286 $53 $2,756 $2,738 $17 $3,342 $3,461 ($119) DVN $2,136 $2,037 $99 $2,892 $2,730 $163 $3,345 $3,172 $173 PXD $2,100 $2,100 $0 $2,750 $2,600 $150 $3,200 $3,200 $0 APA $2,030 $2,028 $3 $3,218 $3,208 $11 $3,998 $3,855 $142 AR $1,880 $1,880 $0 $1,900 $1,900 $0 $2,300 $2,300 $0 CHK $1,750 $1,700 $50 $2,200 $2,200 $0 $2,700 $2,400 $300 EQT $1,490 $1,490 $0 $2,200 $2,250 ($50) $2,615 $2,615 $0 NBL $1,450 $1,450 $0 $2,200 $1,700 $500 $2,700 $2,500 $200 MRO $1,432 $1,446 ($14) $2,217 $1,928 $289 $2,769 $2,479 $290 CXO $1,300 $1,200 $100 $1,525 $1,525 $0 $1,975 $1,800 $175 CLR $1,098 $1,098 $0 $2,074 $2,074 $0 $2,472 $2,472 $0 NFX $850 $850 $0 $1,000 $950 $50 $1,400 $1,350 $50 SWN $750 $750 $0 $1,050 $1,100 ($50) $1,300 $1,300 $0 MUR $626 $626 $0 $963 $963 $0 $1,297 $1,297 $0 RRC $569 $495 $74 $920 $840 $80 $1,300 $1,150 $150 WLL $550 $550 $0 $700 $700 $0 $1,050 $1,100 ($50) GPOR $525 $525 $0 $750 $750 $0 $950 $950 $0 EPE $490 $490 $0 $450 $450 $0 $550 $550 $0 EGN $485 $485 $0 $800 $650 $150 $850 $800 $50 PE $475 $475 $0 $650 $600 $50 $800 $800 $0 PDCE $450 $485 ($35) $700 $650 $50 $950 $950 $0 CRZO $435 $395 $40 $375 $375 $0 $450 $450 $0 FANG $425 $425 $0 $575 $575 $0 $800 $800 $0 LPI $420 $420 $0 $480 $400 $80 $470 $435 $35 OAS $400 $400 $0 $450 $375 $75 $550 $500 $50 XOG $380 $380 $0 $650 $650 $0 $750 $750 $0 SN $275 $275 $0 $300 $275 $25 $320 $295 $25 CPE $150 $140 $10 $280 $250 $30 $350 $325 $25 SYRG $145 $150 ($5) $325 $350 ($25) $400 $400 $0 Total: $38,799 $38,356 $442 $50,892 $49,311 $1,581 $61,634 $60,218 $1,416 % Change 1.2% 3.2% 2.4% U.S. Independent E&Ps 18
Figure 15: CS Cash Flow Estimate Changes at the CS Deck ($MM) 2016 2017 2018 Ticker: Current Previous Diff Current Previous Diff Current Previous Diff COP $4,270 $4,377 ($107) $7,675 $7,547 $127 $9,659 $9,879 ($220) APC $2,802 $2,659 $143 $5,495 $5,430 $65 $7,092 $6,922 $170 EOG $2,470 $2,485 ($15) $4,951 $4,782 $170 $7,288 $6,810 $478 APA $2,269 $2,055 $214 $3,463 $3,201 $261 $4,394 $4,520 ($126) NBL $1,753 $1,815 ($62) $2,196 $2,083 $113 $2,917 $2,684 $233 PXD $1,690 $1,721 ($31) $2,451 $2,510 ($59) $3,604 $3,732 ($128) DVN $1,483 $1,536 ($54) $2,895 $2,917 ($22) $4,223 $4,204 $19 CXO $1,426 $1,384 $42 $1,579 $1,578 $1 $2,214 $2,135 $78 CLR $1,238 $1,171 $67 $2,324 $2,222 $101 $3,143 $3,061 $83 AR $1,198 $1,169 $29 $1,265 $1,239 $26 $2,032 $1,986 $46 EQT $1,031 $1,052 ($22) $1,510 $1,510 $0 $2,219 $2,223 ($4) CHK $923 $975 ($52) $1,723 $1,811 ($88) $2,867 $2,315 $552 MRO $892 $835 $57 $2,220 $1,970 $250 $3,159 $2,792 $367 NFX $798 $806 ($9) $1,004 $944 $61 $1,544 $1,478 $66 EPE $749 $723 $26 $379 $349 $30 $409 $396 $13 MUR $730 $704 $26 $1,149 $1,250 ($101) $1,603 $1,649 ($46) HES $670 $574 $96 $1,888 $2,033 ($145) $2,884 $3,062 ($178) SWN $609 $649 ($40) $1,132 $1,254 ($122) $1,508 $1,726 ($218) RRC $541 $493 $48 $1,005 $967 $37 $1,552 $1,494 $57 WLL $527 $507 $20 $726 $703 $24 $1,070 $1,040 $30 PDCE $458 $465 ($7) $562 $561 $1 $891 $881 $10 GPOR $379 $353 $26 $505 $520 ($15) $912 $916 ($4) OAS $347 $350 ($2) $695 $569 $126 $752 $604 $148 LPI $327 $313 $14 $325 $289 $36 $426 $418 $8 FANG $317 $306 $11 $593 $579 $14 $931 $912 $18 CRZO $301 $291 $10 $375 $355 $20 $551 $495 $56 PE $283 $294 ($11) $564 $539 $25 $980 $941 $39 EGN $240 $257 ($17) $536 $517 $18 $851 $850 $1 SN $180 $186 ($7) $134 $159 ($25) $233 $267 ($34) CPE $141 $134 $7 $254 $239 $15 $422 $389 $33 XOG $140 $134 $5 $422 $430 ($8) $815 $785 $30 SYRG $45 $40 $5 $151 $154 ($2) $319 $314 $6 Total: $31,226 $30,817 $410 $52,147 $51,211 $936 $73,464 $71,880 $1,584 % Change 1.3% 1.8% 2.2% Capex ($MM): $38,799 $38,356 $442 $50,892 $49,311 $1,581 $61,634 $60,218 $1,416 Outspend (% of CF) -20% -20% 2% 4% 19% 19% U.S. Independent E&Ps 19
Figure 16: 2016 & 2017 Outspends at the Strip 2016 2017 Ticker: Capex Cash Flow Outspend Capex Cash Flow Outspend COP $5,199 $4,274 ($925) $4,913 $6,421 $1,508 APC $3,394 $2,902 ($492) $4,129 $4,456 $327 EOG $2,800 $2,469 ($331) $4,500 $4,085 ($415) HES $2,339 $688 ($1,651) $2,756 $1,459 ($1,297) DVN $2,136 $1,479 ($657) $2,892 $2,319 ($573) PXD $2,100 $1,696 ($404) $2,750 $1,959 ($791) APA $2,030 $2,257 $227 $3,218 $2,965 ($254) AR $1,880 $1,206 ($674) $1,900 $1,204 ($696) CHK $1,750 $918 ($832) $2,200 $1,479 ($721) EQT $1,490 $1,101 ($389) $2,200 $1,375 ($824) NBL $1,450 $1,749 $299 $2,200 $1,816 ($384) MRO $1,432 $901 ($531) $2,217 $1,677 ($540) CXO $1,300 $1,422 $122 $1,525 $1,456 ($69) CLR $1,098 $1,240 $143 $2,074 $1,966 ($108) NFX $850 $797 ($53) $1,000 $834 ($166) SWN $750 $586 ($164) $1,050 $1,001 ($49) MUR $626 $665 $39 $963 $981 $18 RRC $569 $540 ($29) $920 $877 ($43) WLL $550 $526 ($24) $700 $527 ($173) GPOR $525 $377 ($148) $750 $471 ($279) EPE $490 $750 $260 $450 $350 ($100) EGN $485 $242 ($243) $800 $460 ($340) PE $475 $284 ($191) $650 $471 ($179) PDCE $450 $458 $8 $700 $486 ($214) CRZO $435 $306 ($129) $375 $313 ($62) FANG $425 $318 ($107) $575 $501 ($74) LPI $420 $327 ($93) $480 $289 ($191) OAS $400 $365 ($35) $450 $482 $32 XOG $380 $138 ($242) $650 $361 ($289) SN $275 $187 ($88) $300 $91 ($209) CPE $150 $141 ($9) $280 $223 ($57) SYRG $145 $54 ($91) $325 $134 ($191) Total: $38,799 $31,364 ($7,435) $50,892 $43,490 ($7,402) Outspend (% of Cash Flow) -19.2% -14.5% U.S. Independent E&Ps 20
NBL US Onshore Long-Term Outlook Update Earlier this week, NBL hosted a US onshore outlook call which featured long term capital spending, cash flow, and production guideposts as well as bumps to type curves in both the DJ and the Delaware, where NBL expects to focus the majority of its capital. In tandem, we raised our target price to $46 (from $44 previously). NBL expects to deliver a 23-29% US onshore oil CAGR through 2020 driven by increased type curves and inventory in the Delaware and DJ Basins. While 2017 production guidance of 400-410 Mboe/d was below our prior 420.7 Mboe/d estimate, US onshore oil production is now expected to increase 13% in 2017 and 20% in 2018, which was higher than our prior estimates of 10% and 19%, respectively. Heading into the call, the main pushback on NBL had been the company s willingness to accelerate US onshore as the bulk of oil growth had come from the GoM over the past two years. The company took those concerns head on, having recently added a rig each to its Delaware and Eagle Ford programs, and announced a third going to the Delaware in a few weeks. NBL added substantially more inventory in the Delaware compared to when the asset was acquired in 1H15, and longer lateral development and increased completion intensity promise further upside given the performance of Generation 4 completions, and additional well catalysts expected throughout 2017. In the DJ, NBL increased EUR s per lateral foot by 20% in Wells Ranch and Mustang and 15% in East Pony. NBL plans to add a third operated rig in mid-2017, and anticipates running a 5-6 rig program longer term. Delaware Update Similar to Southern Delaware Basin peers, NBL added the 3rd Bone Spring as a development target. The company's initial spacing assumptions appear conservative relative to peers at four wells per section, which leaves location upside as NBL delineates its position. Scaling peer 3rd Bone Spring results to a 7,500 ft lateral, we present our production and cume estimates in Figure 17. We note that NBL assumes a 71% oil EUR (3-stream), which is slightly oilier than recent peer results, notably CXO, which released a pair of 3Q16 wells that peaked at 1,909 boe/d from 4,865 ft laterals, but exhibited a 64% oil cut (2-stream). U.S. Independent E&Ps 21
Production (boe/d) Cume (boe) 18 November 2016 Figure 17: 3rd Bone Spring Production and Cume Cume Production 1,600 300,000 1,400 250,000 1,200 1,000 200,000 800 150,000 600 100,000 400 200 50,000 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Months Online 0 Source: HPDI, Credit Suisse estimates Figure 18: CXO 3Q16 3rd Bone Spring Results Figure 19: NBL Delaware Completions and CXO 3 rd Bone Spring Locations Source: CXO 3Q16 Earnings Presentation Source: HPDI, Credit Suisse Estimates NBL also unveiled type curves for the the Wolfcamp B and C in addition to the 3rd Bone Spring in its updated slide, and expects the 3rd Bone Spring will be a near-term target for U.S. Independent E&Ps 22
Fluid Concentration (bbls/ft) Proppant Loading (lbs/ft) 18 November 2016 the company. We note that the Wolfcamp A type curve assumes similar productivity per lateral foot as the previous 700 Mboe, 4,500 ft EUR (Figure 20). Figure 20: NBL Delaware Basin Type Curves (7,500 ft lateral) Following the trend of offset operators, NBL highlighted that iterative generations of completion design have been driving type curve outperformance in the Delaware, with Generation 4 wells materially outperforming the company's revised longer lateral Wolfcamp A type curve. In an attempt to understand what could be causing the outperformance, below we note how slickwater completions appear to be the major driving factor from Gen 3 to Gen 4, as the Calamity Jane #2101H helps the Gen 4 average, having produced a massive 82 Mbbls oil and 137 Mboe total after only two months online (60% oil, two-stream see Figure 21). Figure 21: NBL vs. ROSE Well Result Evolution and Completion Design Source: NBL, Frac Focus, HPDI, Credit Suisse estimates Target EUR (Mboe) Mix (oil/ngl/gas) Well Cost ($MM) 3rd Bone Spring 920 70% / 15% / 15% $6.3 Wolfcamp A 1,200 70% / 15% / 15% $8.5 Wolfcamp B 1,135 70% / 15% / 15% $8.6 Wolfcamp C 900 70% / 15% / 15% $8.8 3,500 3,000 2,500 2,000 1,500 1,000 500 ROSE Completions 0 Nov-13 Jun-14 Dec-14 Jul-15 Jan-16 Aug-16 Mar-17 90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0 10.0 ROSE Completions Completion Date NBL Completions NBL Completions 0.0 Nov-13 Jun-14 Dec-14 Jul-15 Jan-16 Aug-16 Mar-17 Completion Date U.S. Independent E&Ps 23
Figure 22: NBL vs. ROSE Well Performance Cumulative Production (Mboe - 2 Stream) 450 400 350 300 250 200 150 100 50 0 ROSE NBL ROSE (7.5k ft) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 Months on Production Source: HPDI, Credit Suisse estimates The Calamity Jane #2101H was completed with an impressive 3,110 lbs/ft of proppant and utilized ~76 bbls/ft of fluid, relative to other NBL operated results averaging 2,253 lbs/ft and ~45 bbls/ft. Additionally, with a 2017 focus turned to longer lateral development, in Figure 22 we also show how one ROSE operated 7,500' well in the Delaware is materially outperforming ROSE shorter laterals and roughly in-line with NBL operated performance (on shorter laterals). Going forward, we see line of sight on further type curve improvements as NBL's completion design is coupled with longer laterals. DJ Update Similar to the Delaware above, we also reviewed the other major US onshore area for capital deployment, the DJ, with a special focus on the East Pony and Wells Ranch IDPs. Given the breadth of results to look at, we randomly sampled 10 wells per year from each operating area going back to the beginning of 2014 (Figure 23). Results would show that slickwater completion styles appear to be driving the majority of East Pony outperformance (Figure 24), while longer laterals are driving more efficient production from the Wells Ranch area (all 2016 wells sampled were longer than 9,000' Figure 25). While arguably a more mature and well understood play, we nevertheless remain encouraged as NBL tests further enhancements to drilling and completion designs. Early results from 2016 would suggest that while missing the step change in productivity seen from 2015 vintage wells relative to 2014 wells, 2016 is nevertheless on track to perform in-line or better than 2015 and far above 2014 vintage wells. U.S. Independent E&Ps 24
Lateral Length (Productive ft) Fluid Concentration (bbls/ft) 18 November 2016 Figure 23: NBL DJ Well Design Evolution and Production Results 50.0 East Pony 2014 2015 2016 40.0 30.0 20.0 10.0 0.0 Nov-13 Jun-14 Dec-14 Jul-15 Completion Date Jan-16 Aug-16 Wells Ranch 2014 2015 2016 12,000 10,000 8,000 6,000 4,000 2,000 0 Nov-13 Jun-14 Dec-14 Jul-15 Jan-16 Aug-16 Mar-17 Completion Date Source: NBL, Frac Focus, HPDI, Credit Suisse estimates Figure 24: NBL East Pony Well Results by Vintage Cumulative Production (Mboe - 2 Stream 2016 2015 2014 East Pony 9.5k ft Lateral (2015) 180 160 140 120 100 80 60 40 20 0 1 2 3 4 5 6 7 8 9 10111213141516171819202122232425262728293031 Months on Production Source: HPDI, Credit Suisse estimates (Non-9.5k ft laterals range from 4-5k ft) Figure 25: NBL Wells Ranch Well Results by Vintage Cumulative Production (Mboe - 2 Stream) 180 160 140 120 100 80 60 40 20 0 2015 (4,500' lateral) 2014 (9,000' lateral) 2016 (9,000' lateral) 2014 (4,500' lateral) 2015 (9,000' lateral) 2015 (7,000' lateral) 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 Months on Production Source: HPDI, Credit Suisse estimates U.S. Independent E&Ps 25
Wells of the Week A Closer Look at the Northern Powder River Basin Hotspot Following our review of the Southern PRB Hotspot (Wells of the Week Looking Into CHK's LT Oil Growth Driver), we want to take a closer look at the northern PRB hotspot, located near the Campbell Converse county line, as this play has been increasingly discussed by public operators such as EOG and DVN during 3Q earnings. Figure 26: DJ and PRB Hotspots Source: CHK Most of the wells near the northern hotspot drilled to date target the Parkman or the Turner, and of the two, the Turner is believed to have better economics despite the higher associated well costs from drilling a deeper target formation. As a result, we focus our analysis on the Turner Sandstone. Figure 27: Drillable Formations in the PRB Figure 28: IRR by Drilling Zones Source: DVN Source: DVN The most active players targeting Turner are EOG, DVN, and two private operators Peak Powder River Resources and Ballard Petroleum Holdings. DVN holds the biggest acreage U.S. Independent E&Ps 26
position in the basin (470k net acres), followed by EOG (who holds 200k net acres post Yates acquisition). Figure 29: Historic Turner by Peak Oil (2013+) Source: HPDI Rapid GOR Shift The first thing we noticed from historical production data is the significant differences in GOR from just moving a few miles within the Southern Campbell/Northern Converse areas. Among the 192 wells we looked at, all are located within ~30 miles of each other, but have oil cuts ranging from 11% to 96% (on cumulative production to date). Figure 30: Significant GOR Shift Seen within A Few Miles Converse Campbell 0% 20% 40% 60% 80% 100% Oil Cut (%) Source: HPDI We further analyzed the distribution of oil cuts across the county line acreage by breaking our well sample into four buckets: below 40%, 40% - 60%, 60% - 80% and over 80% and mapping where these wells are located. U.S. Independent E&Ps 27
Figure 31: Historical Turner Wells with Oil Cut Below 40% Figure 32: Historical Turner Wells with Oil Cut Between 40% and 60% Source: HPDI Source: HPDI Figure 33: Historical Turner Wells with Oil Cut Between 60% and 80% Figure 34: Historical Turner Wells with Oil Cut Above 80% The distribution of oil cuts across the county line acreage seems to suggest a similar pattern to what we see in the DJ basin (Figure 35) and southern PRB hotspot (Figure 36) some form of concentric elliptical boundaries, across which the hydrocarbon mix characteristics change. The drastic shift in GOR is likely due to a common phenomenon associated with hotspots the closer to the center of the hotspot, the more heated, cooked, and pressurized the reservoirs are, leading to higher gas cut. U.S. Independent E&Ps 28
Figure 35: DJ GOR Map Figure 36: Southern PRB Hotspot GOR Map Source: SYRG Source: CHK To that point, the southern hotspot in the PRB is believed to be hotter than the north, leading to higher pressure compared to the northern one. As seen in Figure 19, while the GOR gradually increases throughout the life of the well, southern hotspot wells have higher GORs compared to wells in both Converse and especially in Campbell. Further, and unsurprisingly, southern hotspot wells have higher IP rates compared to Converse and Campbell given the gassier mix. Figure 37: GOR Shift Over Life of Well for Turner Wells CHK Southern Hotspot GOR Campbell GOR Converse GOR 5,200 4,700 4,200 3,700 3,200 2,700 2,200 1,700 1,200 700 1 6 11 16 21 26 Source: Credit Suisse estimates, HPDI, CHK U.S. Independent E&Ps 29
Figure 38: Turner Type Curves 1,200 Turner-CHK Type Curve Turner-Converse Type Curve Turner-Campbell Type Curve 1,000 800 Daily Production (boe/d) 600 400 200 0 1 11 21 Source: HPDI Based on observations and historical well results, we estimate oil cut distributions for respective operators near the northern hotspot. Based on our work, legacy EOG acreage is mainly located in the high GOR area (oil cut below 60%), while the recently acquired Yates acreage sits in a lower GOR area (oil cut above 80%). DVN, Ballard and Peak's acreage also sit in areas where oil cut is above 60%. Figure 39: Estimated Heat Map Based on Historical Wells Source: Credit Suisse estimates, HPDI Core of County Line Acreage Additionally, we wanted to look at where the best performing wells are near the county line by comparing individual historical production data to our modeled EOG PRB type curve. U.S. Independent E&Ps 30
Figure 40: Modeled EOG PRB Type Curve % Oil 37% % NGL 17% % Gas 46% Production (boe/d) 1,000 100 10 IP-30: EUR: Well Cost: ATAX IRR: NPV/well: 1,240 boe/d 1,165 Mboe $4.9mm 27.4% $3.2mm 0 0 1 2 3 4 5 6 7 8 9 10 11 12 Years 900 800 700 600 500 400 300 200 100 Cumulative Production (Mboe) Source: EOG, Credit Suisse estimates We found 36 wells that are currently trending above our PRB type curve. It doesn't come as a surprise that a good proportion of these wells are located near the northern hotspot, as a result of the reservoir being more heated and pressurized. Figure 41: PRB Wells Historical Cume Production Figure 42: Outperforming PRB Wells 700 600 Cumulative Production (MBoe) 500 400 300 200 100 0 0 5 10 15 20 25 30 Source: Credit Suisse estimates, HPDI Source: Credit Suisse estimates, HPDI However, to the western portion of Campbell, there are a few wells that have oil cuts between 60% 80%. Therefore, taking into consideration GOR and well performance, we believe the sweet spot of the county line acreage is in southwest Campbell (Figure 43). EOG, Peak and Ballard Energy have been the most active players in that region historically. U.S. Independent E&Ps 31
Figure 43: Sweet Spot of Northern Hotspot Acreage Figure 44: EOG PRB Acreage Post Yates Acquisition Source: Company data Improving Well Performance over Time One additional thing to note is that most of wells trending above type curves are drilled recently (2015+). We can see in Figure 20 that well performances have been improving over time, which is most likely driven by longer lateral length. While there is no data to U.S. Independent E&Ps 32
verify trends in lateral length as it is not reported in WY, both DVN and EOG have commented about longer lateral driving improving well economics. Figure 45: Vintage Type Curve By Year Source: HPDI Last Six Wells of the Week: 10/28/2016: A Look at EQT Completion Designs 10/21/2016: Looking Into CHK's LT Oil Growth Driver 10/14/2016: Reviewing FANG's Completion Design 10/07/2016: PE's Completion Evolution, Monster-Fracs, and Delaware Read-through 09/30/2016: An Initial Read on EGN s Upsized Completions 09/23/2016: EOG's Longer Laterals in the Eagle Ford West U.S. Independent E&Ps 33
$51.27 $53.03 $2.85 $53.38 $53.60 $53.65 $3.04 3 $54.06 $54.24 $54.72 $3.07 $54.90 $55.19 $55.23 $55.39 $3.26 $55.41 $56.27 $57.17 $3.36 $57.34 $58.29 $58.57 $3.63 $59.51 $61.00 $61.38 $3.98 $61.39 $61.87 $62.23 $62.85 $4.36 $65.25 $70.91 18 November 2016 Valuation Snapshot Implied Oil and Gas Prices Figure 46: Equity Implied Gas Prices As of 11/18/16 $5.00 Gas Median $3.31 2016 Strip $2.76 2017 Strip $3.00 $4.50 $4.00 $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $0.00 Figure 47: Equity Implied Oil Prices As of 11/18/16 WTI Oil Median $56.27 2016 Strip $45.42 2017 Strip $48.80 $80.00 $70.00 $60.00 $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 U.S. Independent E&Ps 34
Figure 48: E&P Upside/Downside to NAV 75% E&P Median: 23% Upside 1% -4% -1% 4% 51% 50% 25% 8% 9% 10% 13% 17% 19% 20% Upside / Downside at the Strip 23% 23% 23% 23% 24% 25% 25% 25% 28% 29% 29% 29% 30% 31% 32% 33% 35% 41% 42% 0% -25% -50% -33% -29% Figure 49: E&P Upside/Downside to NAV at CS Deck and Strip 25% Mkt Cap Wtd. Avg. AR 0% (25%) OXY APC EQT FANG NBL DVN PE CPE PXD WLL CXO EGN HES NFX APA OAS PDCE MRO SYRG EOG CRZO RRC MUR XOG GPOR CLR (50%) LPI SWN (75%) SN (100%) DNR EPE CHK (40%) (30%) (20%) (10%) 0% 10% 20% 30% 40% 50% 60% Upside / Downside at the CS Deck U.S. Independent E&Ps 35
4.0x 4.6x 7.9x 8.2x 8.7x 8.9x 8.9x 9.4x 9.7x 10.3x 10.4x 10.5x 10.5x 10.6x 11.0x 11.6x 12.4x 12.8x 13.1x 13.2x 13.8x 14.2x 14.8x 16.8x 16.9x 16.9x 17.9x 18.0x 19.6x 21.3x 22.0x 23.6x 31.4x 4.8x 5.2x 8.3x 9.3x 9.3x 9.4x 9.6x 9.8x 10.0x 10.6x 10.8x 10.9x 11.0x 11.7x 11.7x 11.8x 12.6x 12.7x 12.9x 13.9x 14.3x 14.8x 15.0x 17.5x 17.7x 17.8x 19.0x 19.3x 20.9x 21.3x 22.7x 23.4x 30.5x 18 November 2016 Figure 50: 2016 EV to EBITDA (unhedged at the strip, $45.57/bbl WTI, $2.76/MMbtu) 32.0x 30.0x E&P Median: 12.6x 28.0x 26.0x Oil Focused: 12.8x 24.0x Gas Focused: 10.9x 22.0x 20.0x 18.0x 16.0x 14.0x 12.0x 10.0x 8.0x 6.0x 4.0x 2.0x 0.0x Figure 51: 2016 EV to EBITDA (hedged at the CS Deck, $42.18/bbl WTI, $2.45/MMbtu gas) 32.0x 30.0x E&P Median: 12.4x 28.0x 26.0x 24.0x Oil Focused: 13.0x Gas Focused: 10.5x 22.0x 20.0x 18.0x 16.0x 14.0x 12.0x 10.0x 8.0x 6.0x 4.0x 2.0x 0.0x U.S. Independent E&Ps 36
5.3x 6.0x 6.3x 6.5x 6.6x 6.6x 6.8x 6.9x 7.1x 7.3x 7.8x 7.8x 7.8x 7.9x 7.9x 8.0x 8.0x 8.0x 8.1x 8.4x 9.3x 9.4x 9.7x 10.0x 10.1x 10.1x 10.2x 11.2x 11.4x 12.1x 12.1x 12.4x 12.9x 5.9x 7.5x 7.6x 7.9x 8.2x 8.4x 8.6x 8.6x 8.8x 9.3x 9.4x 9.4x 9.4x 9.5x 9.6x 9.7x 10.0x 10.3x 11.0x 11.2x 11.4x 11.5x 11.5x 11.8x 12.4x 12.7x 12.8x 13.3x 13.9x 14.1x 14.4x 15.2x 15.9x 18 November 2016 Figure 52: 2017 EV to EBITDA (unhedged at the strip, $48.69/bbl WTI, $3.00/MMbtu) 16.0x E&P Median: 10.0x 14.0x 12.0x Oil Focused: 10.6x Gas Focused: 9.4x 10.0x 8.0x 6.0x 4.0x 2.0x 0.0x Figure 53: 2017 EV to EBITDA (hedged at the CS Deck, $55.00/bbl WTI, $3.25/MMbtu gas) 14.0x 12.0x 10.0x E&P Median: 8.0x Oil Focused: 8.2x Gas Focused: 7.9x 8.0x 6.0x 4.0x 2.0x 0.0x U.S. Independent E&Ps 37
3.5x 4.1x 4.1x 4.2x 4.6x 4.8x 5.0x 5.0x 5.1x 5.2x 5.3x 5.3x 5.5x 5.5x 5.6x 5.8x 5.9x 5.9x 6.0x 6.3x 6.3x 6.4x 6.5x 6.6x 6.7x 7.0x 7.1x 7.6x 8.0x 8.1x 8.1x 8.2x 8.8x 5.0x 5.7x 6.0x 6.6x 7.2x 7.2x 7.3x 7.4x 7.4x 7.5x 7.6x 7.7x 8.0x 8.2x 8.2x 8.5x 8.8x 9.1x 9.1x 9.4x 9.5x 9.6x 9.6x 9.8x 9.9x 10.1x 11.1x 10.4x 10.6x 10.8x 11.1x 11.1x 11.6x 18 November 2016 Figure 54: 2018 EV to EBITDA (unhedged at the strip, $50.83/bbl WTI, $2.94/MMbtu) 14.0x 12.0x 10.0x E&P Median: 8.8x Oil Focused: 8.8x Gas Focused: 8.8x 8.0x 6.0x 4.0x 2.0x 0.0x Figure 55: 2018 EV to EBITDA (hedged at the CS Deck, $62.50/bbl WTI, $3.50/MMbtu gas) 9.0x 8.0x 7.0x E&P Median: 5.9x Oil Focused: 5.9x Gas Focused: 5.9x 6.0x 5.0x 4.0x 3.0x 2.0x 1.0x 0.0x U.S. Independent E&Ps 38
Figure 56: Debt Adjusted Cash Flow Per Share (2015 2018E) 100% 75% E&P Median: 13.1% Gas-Focused: 11.9% Oil-Focused: 12.5% 61% 76% 83% 50% 25% 0% -25% -50% -37% -31% -16% -7% -5% -2% -1% 1% 2% 6% 7% 8% 8% 10% 11% 12% 13% 13% 17% 18% 19% 22% 23% 25% 26% 29% 30% 31% 33% 35% Figure 57: 2016 Net Debt to EBITDA 8.0x CS Deck Futures Strip Median at CS Deck Median at Strip Median at CS Deck: 2.7x Median at Strip: 2.7x 6.0x 4.0x 2.0x 0.0x 2016 Price Scenario CS Strip WTI Oil $42.18 $45.57 NYMEX Gas $2.45 $2.76 U.S. Independent E&Ps 39
Figure 58: 2017 Net Debt to EBITDA 8.0x 7.0x 6.0x CS Deck Futures Strip Median at CS Deck Median at Strip Median at CS Deck: 1.8x Median at Strip: 2.3x 5.0x 4.0x 3.0x 2.0x 1.0x 0.0x 2017 Price Scenario CS Strip WTI Oil $55.00 $48.69 NYMEX Gas $3.25 $3.00 U.S. Independent E&Ps 40
Figure 59: Net Debt (as a % of EV) Current Net Debt (% of EV) EXXI SGY REXX CRK CRC WTI XCO AREX EPE CIE SN DNR JONE CHK WLL BBG HK OAS CNX KOS SM SWN AR CRZO WPX ECA RRC ECR COP MUR MRO NBL DVN LPI CLR APC CWEI APA NFX HES QEP XOG GPOR RSPP EOG COG OXY EQT CXO XEC PE FANG PXD EGN RICE CPE SYRG PDCE UPL 20% 19% 19% 17% 16% 12% 10% 9% 9% 9% 8% 6% 5% 4% 2% 2% 1% 43% 42% 40% 39% 38% 38% 36% 32% 31% 31% 31% 31% 29% 29% 29% 29% 28% 27% 26% 24% 24% 66% 65% 61% 57% 53% 82% 80% 80% 78% 76% 75% 71% 90% 89% 98% 96% 0% 20% 40% 60% 80% 100% U.S. Independent E&Ps 41
Figure 60: 2016 Outspend at the CS Deck ($42.18 WTI/$2.45 NYMEX) 200% 2016 Outspend (% of CF) Group Outspend 150% 100% 50% 0% (50%) Figure 61: 2017 Outspend at the CS Deck ($55.00 WTI/$3.25 NYMEX) 2017 Outspend (% of CF) Group Outspend 140% 120% 100% 80% 60% 40% 20% 0% (20%) (40%) (60%) U.S. Independent E&Ps 42
Hedging Oil Figure 62: 2016 Oil Volumes Hedged $110.00-3% 4% 7% 22% 25% 27% -7% -21% -27% 30% 20% 19% 42% -12% -2% -35% -3% -11% -70% -54% -16% -13% -11% -36% -31% -4% -10% -26% 8% 2% 2% 7% 19% 20% 21% 26% 24% 33% 33% 36% 36% 45% 46% 50% 52% 57% 60% 49% 50% 40% 4% 79% 62% 74% 15% 11% 26% 140% % Volumes Hedged % Short Put (on 3-way Collars) % Short Call (on 3-way Collars) Average Floor Price ($/bbl) Average Ceiling Price ($/bbl) Average Put Price ($/bbl) Average Call Price ($/bbl) 120% 100% 80% 60% 40% 20% 0% -20% -40% -60% 48% -15% 57% 58% 58% -49% 61% 67% 69% 71% -20% 75% -42% 76% 80% -61% 83% 23% 63% 93% 25% 77% -15% 63% 40% 34% 84% -63% $100.00 $90.00 $80.00 $70.00 $60.00 $50.00-80% $40.00 Figure 63: 2017 Oil Volumes Hedged 100% % Volumes Hedged % Short Put (on 3-way Collars) % Short Call (on 3-way Collars) Average Floor Price ($/bbl) Average Ceiling Price ($/bbl) Average Put Price ($/bbl) Average Call Price ($/bbl) $100.00 80% 60% $90.00 40% $80.00 20% 0% $70.00-20% $60.00-40% -60% -80% $50.00 $40.00 U.S. Independent E&Ps 43
Gas Figure 64: 2016 Gas Volumes Hedged $6.00 $5.00 2% 2% -1% 14% 17% -6% 21% 21% -28% 23% -13% -13% -48% -32% -39% -11% -4% -3% -18% 2% 2% 8% 25% 27% 28% 29% 30% 32% 32% 13% 21% 39% 40% 40% 49% 53% 44% 54% 58% 44% 75% 66% 63% 12% 62% 65% 25% 70% 112% 5% % Volumes Hedged % Short Put (on 3-way Collars) % Short Call (on 3-way Collars) Average Floor Price ($/Mmbtu) Average Ceiling Price ($/Mmbtu) Average Put Price ($/Mmbtu) Average Call Price ($/Mmbtu) 140% 120% 100% 80% 60% 40% 20% 0% -20% -40% 25% 5% 21% -13% 26% 27% 31% 35% 38% -2% 41% 63% 67% 72% -52% 75% -17% 80% 5% 77% 85% 119% $4.00 $3.00 $2.00 $1.00-60% -80% $0.00 Figure 65: 2017 Gas Volumes Hedged % Volumes Hedged % Short Put (on 3-way Collars) % Short Call (on 3-way Collars) Average Floor Price ($/Mmbtu) Average Ceiling Price ($/Mmbtu) Average Put Price ($/Mmbtu) Average Call Price ($/Mmbtu) 140% 120% 100% 80% $10.00 $9.00 $8.00 $7.00 60% $6.00 40% $5.00 20% $4.00 0% $3.00-20% $2.00-40% $1.00-60% $0.00 U.S. Independent E&Ps 44
Oil and NGL Macro Figure 66: Regional Oil Differentials to WTI - As of 11/18/16 WTI-Brent Mid-Cush Bakken-WTI EF Light-WTI 10 5 0-5 -10-15 -20-25 -30-35 1/3/2012 3/3/2012 5/3/2012 7/3/2012 9/3/2012 11/3/2012 1/3/2013 3/3/2013 5/3/2013 7/3/2013 9/3/2013 11/3/2013 1/3/2014 3/3/2014 5/3/2014 7/3/2014 9/3/2014 11/3/2014 1/3/2015 3/3/2015 5/3/2015 7/3/2015 9/3/2015 11/3/2015 1/3/2016 3/3/2016 5/3/2016 7/3/2016 9/3/2016 11/3/2016 1/6/2012 3/6/2012 5/6/2012 7/6/2012 9/6/2012 11/6/2012 1/6/2013 3/6/2013 5/6/2013 7/6/2013 9/6/2013 Differential ($ per Bbl) 11/6/2013 1/6/2014 3/6/2014 5/6/2014 7/6/2014 9/6/2014 11/6/2014 1/6/2015 3/6/2015 5/6/2015 7/6/2015 9/6/2015 11/6/2015 1/6/2016 3/6/2016 5/6/2016 7/6/2016 9/6/2016 11/6/2016 Price ($ per Bbl) Percentage of WTI (%) Source: the BLOOMBERG PROFESSIONAL service, Credit Suisse estimates Figure 67: NGL Composite Prices (at Mt. Belvieu) - As of 11/18/16 NGL as a Percentage of WTI (%) Propane ($ per Bbl) Normal Butane ($ per Bbl) Isobutane ($ per Bbl) Ethane ($ per Bbl) Natural Gasoline ($ per Bbl) 120 50% 110 100 90 80 70 45% 40% 35% 30% 60 25% 50 40 30 20 10 20% 15% 10% 5% 0 0% Source: the BLOOMBERG PROFESSIONAL service, Credit Suisse estimates U.S. Independent E&Ps 45
1/6/2012 3/6/2012 5/6/2012 7/6/2012 9/6/2012 11/6/2012 1/6/2013 3/6/2013 5/6/2013 7/6/2013 9/6/2013 11/6/2013 1/6/2014 3/6/2014 5/6/2014 7/6/2014 9/6/2014 11/6/2014 1/6/2015 3/6/2015 5/6/2015 7/6/2015 9/6/2015 11/6/2015 1/6/2016 3/6/2016 5/6/2016 7/6/2016 9/6/2016 11/6/2016 Differential ($ per MMBtu) Gas Macro Figure 68: US Natural Gas Storage - As of 11/11/16 Change Change Differential 11/11/2016 Week Ago % Bcf Year Ago % Bcf 5-Year Avg % Bcf East 944 946 (0.2%) (2) 933 1.2% 11 926 1.9% 18 Midwest 1,155 1,148 0.6% 7 1,122 2.9% 33 1,093 5.7% 62 Mountain 257 253 1.6% 4 215 19.5% 42 209 23.0% 48 Pacific 328 327 0.3% 1 381 (13.9%) (53) 369 (11.1%) (41) South Central 1,363 1,343 1.5% 20 1,345 1.3% 18 1,234 10.5% 129 Total U.S. 4,047 4,017 0.7% 30 3,9963 1.3% 51 3,831 5.6% 216 Billion Cubic Feet 4,500 4,000 3,500 3,000 2,500 2,000 1,500 5-Yr Range 2016 5-Yr Avg. 2015 Total U.S. Working Gas In Storage 1,000 500 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 Calendar Week Source: EIA, Credit Suisse estimates Figure 69: Select Northeast Gas Price Differential to Henry Hub - As of 11/18/16 2.00 Columbia TCO to HH Leidy to HH Dominion South to HH M2 to HH 1.00 0.00-1.00-2.00-3.00-4.00 Source: the BLOOMBERG PROFESSIONAL service U.S. Independent E&Ps 46
Focus on Capex and Costs Figure 70: 2016 and 2017 Capex per boe 2016 Capex/boe 2017 Capex/boe 2016 Median 2017 Median $50 $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 Figure 71: 2015 2017 Cash Costs per boe $35 2015 Cash Costs/boe 2016 Cash Costs/boe 2017 Cash Costs/boe 2015 Median 2016 Median 2017 Median $30 $25 $20 $15 $10 $5 $0 U.S. Independent E&Ps 47
Figure 72: Large Cap Oil Headline Cashflow Cash Margins - Hedged ($/boe, 2015-2018) $40 HES MUR PXD CVX OXY COP CLR XOM APA CXO EOG NBL MRO APC DVN CHK $35 $30 $25 $20 $15 $10 $5 $0 -$5 2015 ($48.76/bbl) 2016 ($42.18/bbl) 2017 ($55.00/bbl) 2018 ($62.50/bbl) Figure 73: SMID Cap Oil Headline Cashflow Cash Margins - Hedged ($/boe, 2015-2018) $40 SYRG OAS CRZO EGN DNR EPE PDCE LPI FANG WLL PE CPE BCEI SN XOG $35 $30 $25 $20 $15 $10 $5 $0 2015 ($48.76/bbl) 2016 ($42.18/bbl) 2017 ($55.00/bbl) 2018 ($62.50/bbl) U.S. Independent E&Ps 48
Figure 74: Gas Cash Margins ($/Mcfe, 2015-2018) $2.5 AR RRC SWN EQT GPOR $2.0 $1.5 $1.0 $0.5 $0.0 2015 ($2.67/Mcf) 2016 ($2.45/Mcf) 2017 ($3.25/Mcf) 2018 ($3.50/Mcf) ' U.S. Independent E&Ps 49
Figure 75: Historical Lease Operating Expense ($/boe) 3Q16/2Q16 3Q16/3Q15 4Q15 1Q16 2Q16 3Q16 QoQ YoY Majors COP $12.5 $12.6 $12.4 $11.8 (5%) (6%) CVX $12.8 $12.4 $12.3 $11.2 (9%) (13%) XOM $10.8 $9.5 $9.5 $9.5 (1%) (17%) OXY $10.1 $10.3 $10.2 $10.8 6% (2%) Median $11.6 $11.3 $11.2 $11.0 (2%) (8%) Sequential Change (3%) (3%) (1%) (2%) Large Cap E&P APA $10.1 $8.7 $8.6 $9.5 11% 5% APC $3.2 $2.8 $2.8 $2.8 (2%) (24%) AR $0.5 $0.4 $0.5 $0.5 7% 3% CHK $3.6 $3.4 $3.0 $2.8 (8%) (32%) CLR $3.9 $3.7 $3.7 $3.5 (6%) (12%) CXO $10.2 $7.3 $5.8 $5.0 (15%) (50%) DVN $7.6 $7.1 $7.1 $6.7 (5%) (18%) EOG $4.7 $4.8 $4.4 $4.4 2% (18%) HES $14.1 $12.9 $15.4 $14.0 (9%) 4% MRO $5.7 $5.4 $5.3 $4.3 (18%) (27%) MUR $10.2 $8.9 $10.2 $7.7 (25%) (20%) NBL $3.8 $4.3 $3.1 $3.3 9% (12%) PXD $9.4 $7.8 $6.7 $6.4 (4%) (34%) Median $5.7 $5.4 $5.3 $4.4 (16%) (25%) Sequential Change (3%) (6%) (2%) (16%) SMID Cap E&P CPE $6.5 $6.2 $6.0 $6.5 9% (19%) CRZO $6.2 $6.3 $6.1 $6.5 6% (4%) DNR $19.3 $16.2 $17.0 $18.8 10% 9% EGN $8.8 $8.5 $7.3 $7.9 8% (15%) EPE $4.5 $4.4 $4.9 $5.1 2% 18% EQT $0.7 $0.5 $0.6 $0.5 (10%) (26%) FANG $5.1 $5.2 $5.6 $5.4 (4%) (24%) GPOR $5.7 $5.2 $5.4 $5.6 4% (7%) LPI $5.8 $4.9 $4.4 $3.9 (13%) (37%) NFX $8.4 $8.1 $8.4 $8.6 2% 0% OAS $6.9 $6.8 $7.0 $8.0 14% 4% PDCE $4.8 $5.1 $4.7 $5.0 7% (15%) PE $5.6 $5.3 $4.4 $4.1 (5%) (46%) RRC $1.3 $1.1 $0.9 $0.9 2% (39%) SN $8.7 $8.7 $8.8 $8.2 (7%) (1%) SWN $4.4 $4.2 $4.0 $4.0 (2%) (6%) SYRG $4.4 $4.1 $6.8 $3.8 (43%) (18%) WLL $8.4 $8.6 $8.6 $8.0 (7%) (6%) XOG $5.7 $5.3 $3.3 $5.8 76% 43% Median $5.7 $5.3 $5.6 $5.6 0% (19%) Sequential Change (17%) (8%) 6% 0% / Note: Companies report LOE differently. U.S. Independent E&Ps 50
Figure 76: Texas Well Completions (1 of 3) Week up to 11/18/2016 Operator 24 hr. IP Oil Test Completion Lateral IP - Boe/d % Oil Well Name County Test Date Field Basin / Sub-basin - bbl/d Date Length (ft). ANADARKO E&P 950.0 1408.8 67% DOSEY DOE 54-2-17 UNIT # 1H LOVING 10/25/2016 10/31/2016 PHANTOM (WOLFCAMP) Delaware - Permian 6373 ft ANADARKO E&P 2283.0 3356.8 68% SEVENGILLS 54-1-41 # 1H LOVING 10/12/2016 10/21/2016 PHANTOM (WOLFCAMP) Delaware - Permian 3751 ft ANADARKO E&P 582 759.7 77% NANCY COUCH UNIT 3-15 # 1H REEVES 7/29/2016 7/31/2016 PHANTOM (WOLFCAMP) Delaware - Permian 8875 ft APACHE CORPORATION 707 1095.3 65% MAGPIE UNIT #P111H LOVING 10/11/2016 10/31/2016 PHANTOM (WOLFCAMP) Delaware - Permian 5932 ft ATLAS EAGLE 726 753.7 96% HARRIS #A 4H ATASCOSA 9/22/2016 9/27/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6927 ft ATLAS EAGLE 722 779.7 93% MGS UNIT #B 1H ATASCOSA 10/10/2016 10/13/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6879 ft ATLAS EAGLE 925 993.7 93% MGS UNIT #B 2H ATASCOSA 10/10/2016 10/12/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 7040 ft BP AMERICA 350 447.3 78% HILL, PERCY E #4648H LIPSCOMB 5/26/2016 6/21/2016 KIOWA CREEK (MARMATON) Granite Wash 5144 ft BURLINGTON RESOURCES 2507 2804.2 89% LEO FRANK UNIT B #2 KARNES 9/7/2016 9/22/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 4705 ft CARRIZO (EAGLE 532 569.2 94% MILLETT A UNIT # 21H LA SALLE 9/7/2016 10/29/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5659 ft CARRIZO (EAGLE 612 671.8 91% MILLETT B UNIT # 22H LA SALLE 9/8/2016 10/21/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 4782 ft CARRIZO (EAGLE 731 794.5 92% PENA # 43H LA SALLE 8/19/2016 9/27/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5268 ft CHESAPEAKE OPERATING, 623 623.0 100% LAZY A COTULLA UNIT DIM #H 2H DIMMIT 9/17/2016 9/19/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 10554 ft CHESAPEAKE OPERATING, 759 849.8 89% LAZY A COTULLA UNIT DIM #H 4H DIMMIT 9/18/2016 9/29/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 10607 ft CHESAPEAKE OPERATING, 949 1035.2 92% LAZY A COTULLA UNIT DIM #H 3H DIMMIT 9/19/2016 9/25/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 10567 ft CHESAPEAKE OPERATING, 1309 1438.0 91% LAZY A COTULLA #G 4H DIMMIT 8/30/2016 9/9/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 10547 ft CHESAPEAKE OPERATING, 1007 1083.2 93% LAZY A COTULLA #H 1H DIMMIT 9/18/2016 10/2/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 4003 ft CHESAPEAKE OPERATING, 821 909.0 90% LAZY A COTULLA #H 5H DIMMIT 9/19/2016 10/2/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 10506 ft CHESAPEAKE OPERATING, 1071 1151.5 93% PEELER MCM #O 1H MCMULLEN 9/13/2016 9/14/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6241 ft CHESAPEAKE OPERATING, 1191 1278.0 93% PEELER MCM #O 2H MCMULLEN 9/13/2016 9/17/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6204 ft CHESAPEAKE OPERATING, 955 1023.2 93% PEELER MCM #O 4H MCMULLEN 9/13/2016 9/14/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6115 ft CHESAPEAKE OPERATING, 1038 1110.2 93% PEELER MCM #O 5H MCMULLEN 9/12/2016 9/15/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6165 ft CHESAPEAKE OPERATING, 845 929.8 91% PEELER MCM #O 6H MCMULLEN 9/12/2016 9/13/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6087 ft CHESAPEAKE OPERATING, 1171 1291.8 91% JJ HENRY UNIT VI #J 2H MCMULLEN 9/16/2016 9/22/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 7418 ft CHESAPEAKE OPERATING, 988 1081.7 91% JJ HENRY UNIT VI #J 3H MCMULLEN 9/16/2016 9/22/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 7376 ft CHESAPEAKE OPERATING, 1314 1432.7 92% JJ HENRY UNIT VI #J 4H MCMULLEN 9/18/2016 9/24/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 7147 ft DIAMONDBACK E&P 514 573.0 90% PHILLIPS-HODNETT UNIT # 1LS HOWARD 6/22/2016 8/28/2016 SPRABERRY (TREND AREA) Midland - Permian 7296 ft DIAMONDBACK E&P 1346 1501.5 90% PHILLIPS-HODNETT UNIT # 1WA HOWARD 6/15/2016 7/15/2016 SPRABERRY (TREND AREA) Midland - Permian 7430 ft DISCOVERY OPERATING, 1100 1214.5 91% GERONIMO (SA) C #2703LS MIDLAND 9/11/2016 10/28/2016 SPRABERRY (TREND AREA) Midland - Permian 7788 ft ELK RIVER 168 187.2 90% WAPITI 12-17 # 4H ANDREWS 7/15/2016 8/3/2016 THREE BAR (WICHITA) Central Basin - Permian 7097 ft Source: Texas RRC
Figure 77: Texas Well Completions (2 of 3) Week up to 11/18/2016 Operator 24 hr. IP Oil Test Completion Lateral IP - Boe/d % Oil Well Name County Test Date Field Basin / Sub-basin - bbl/d Date Length (ft). ENCANA OIL 759 869.5 87% HONS UNIT # 19H KARNES 8/17/2016 11/5/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 4367 ft ENCANA OIL 905 958.2 94% HOFFMANN UNIT # 17H KARNES 8/17/2016 11/5/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 4557 ft ENERGEN RESOURCES 765 824.3 93% JONES-HOLTON # 509H MARTIN 4/27/2016 5/15/2016 SPRABERRY (TREND AREA) Midland - Permian 6667 ft ENERGEN RESOURCES 727 802.3 91% JONES-HOLTON # 506H MARTIN 4/25/2016 6/10/2016 SPRABERRY (TREND AREA) Midland - Permian 7041 ft ENERGEN RESOURCES 1121 1130.8 99% JONES-HOLTON # 507H MARTIN 4/28/2016 5/1/2016 SPRABERRY (TREND AREA) Midland - Permian 7010 ft ENERGEN RESOURCES 531 601.5 88% JONES-HOLTON # 510H MARTIN 5/23/2016 7/17/2016 SPRABERRY (TREND AREA) Midland - Permian 7106 ft ENERGEN RESOURCES 860 1005.8 86% JONES-HOLTON # 210H MARTIN 5/9/2016 6/24/2016 SPRABERRY (TREND AREA) Midland - Permian 7120 ft ENERVEST OPERATING, 610 672.2 91% PAWLIK-RODRIGUEZ UNIT # 1H ATASCOSA 9/9/2016 9/15/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5309 ft ENERVEST OPERATING, 293 327.3 90% JANECKA # 1H FAYETTE 11/4/2014 11/7/2014 CANNON (NAVARRO) Eagle Ford 6006 ft EOG RESOURCES, 1547 2030.8 76% STATE PATHFINDER # 17H LOVING 3/7/2016 3/11/2016 SANDBAR (BONE SPRING) Delaware - Permian 4840 ft EOG RESOURCES, 1299 1355.0 96% JAVELINA UNIT # 2H ATASCOSA 10/13/2016 10/14/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 7532 ft EOG RESOURCES, 1008 1189.8 85% SPAHN FARMS UNIT # 8H GONZALES 10/27/2016 11/3/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5687 ft EOG RESOURCES, 623 728.2 86% SPAHN FARMS UNIT # 9H GONZALES 10/27/2016 10/31/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5822 ft EOG RESOURCES, 1033 1215.0 85% SPAHN FARMS UNIT # 10H GONZALES 10/27/2016 11/3/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5865 ft EOG RESOURCES, 2091 2230.7 94% SPRADLIN UNIT # 2H GONZALES 10/17/2016 10/18/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 4502 ft EOG RESOURCES, 1829 1948.8 94% SPRADLIN UNIT # 3H GONZALES 10/17/2016 10/18/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 4519 ft EOG RESOURCES, 1471 1558.0 94% SPRADLIN UNIT # 4H GONZALES 10/17/2016 10/18/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 4376 ft EOG RESOURCES, 5617 6853.8 82% FUJI UNIT # 101H KARNES 9/1/2016 9/7/2016 SUGARKANE (AUSTIN CHALK) Eagle Ford 6488 ft EOG RESOURCES, 609 690.2 88% URBANCZYK UNIT # 7H KARNES 10/25/2016 10/28/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 3954 ft EOG RESOURCES, 585 676.0 87% URBANCZYK UNIT # 9H KARNES 10/25/2016 10/27/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 4018 ft EOG RESOURCES, 105 125.0 84% NAYLOR JONES UNIT 87 # 101H LA SALLE 6/26/2016 7/5/2016 SUGARKANE (AUSTIN CHALK) Eagle Ford 6610 ft HUNT OIL 798 882.8 90% BOONE-COFFEE (PSA) # 7HA GLASSCOCK 10/4/2016 10/21/2016 SPRABERRY (TREND AREA) Midland - Permian 7517 ft KINDER MORGAN 212 300.2 71% YATES FIELD UNIT #275F41 PECOS 10/31/2016 11/8/2016 YATES Delaware - Permian 996 ft KINDER MORGAN 51 91.7 56% YATES FIELD UNIT # 13Z06 PECOS 10/30/2016 10/31/2016 YATES Delaware - Permian 1206 ft LAREDO PETROLEUM, 1666 1851.7 90% FRYSAK A 47-15 (ALLOC-D) # 4SU GLASSCOCK 6/25/2016 7/17/2016 SPRABERRY (TREND AREA) Midland - Permian 9757 ft LAREDO PETROLEUM, 1326 1755.3 76% HOLT C 132-133 (ALLOC-H) # 8SM REAGAN 4/20/2016 6/13/2016 SPRABERRY (TREND AREA) Midland - Permian 9937 ft LONE STAR 249 274.8 91% HAPGOOD RANCH # 6H CLAY 12/23/2015 3/18/2016 NEWARK, EAST (BARNETT SHALE) #N/A 4681 ft MANTI TARKA 1007 1244.5 81% ASSAULT 126 # 1HA WARD 7/6/2016 8/5/2016 PHANTOM (WOLFCAMP) Delaware - Permian 4804 ft Source: Texas RRC
Figure 78: Texas Well Completions (3 of 3) Week up to 11/18/2016 Operator 24 hr. IP Oil Test Completion Lateral IP - Boe/d % Oil Well Name County Test Date Field Basin / Sub-basin - bbl/d Date Length (ft). MARATHON OIL 1098 1508.8 73% TURNBULL UNIT D # 15H KARNES 8/15/2016 8/17/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 8358 ft MARATHON OIL 1093 1470.2 74% TURNBULL UNIT D # 16H KARNES 8/15/2016 8/18/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 5502 ft MARATHON OIL 732 1004.0 73% TURNBULL UNIT D # 502H KARNES 8/15/2016 8/18/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 5231 ft MARATHON OIL 700 1048.2 67% TURNBULL UNIT D # 501H KARNES 8/15/2016 8/17/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 5348 ft MARATHON OIL 1571 1762.1 89% RIPPSTEIN-GOTTHARDT UNIT # 502H KARNES 9/6/2016 9/9/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 5330 ft MARATHON OIL 1834 2061.3 89% RIPPSTEIN-GOTTHARDT UNIT # 504H KARNES 9/5/2016 9/9/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 4481 ft MATADOR PRODUCTION 733 1092.5 67% DICK JAY 92-TTT-B01 WF # 124H LOVING 3/16/2016 4/22/2016 TWO GEORGES (BONE SPRING) Delaware - Permian 4822 ft MATADOR PRODUCTION 677 1050.3 64% DICK JAY 92-TTT-B01 WF # 203H LOVING 4/5/2016 4/15/2016 PHANTOM (WOLFCAMP) Delaware - Permian 4798 ft MATADOR PRODUCTION 539 1008.7 53% DICK JAY 92-TTT-B01 WF # 212H LOVING 4/6/2016 4/22/2016 PHANTOM (WOLFCAMP) Delaware - Permian 4742 ft MURPHY EXPL. 199 267.0 75% JANYSEK UNIT A # 1H KARNES 9/17/2016 10/4/2016 SUGARKANE (AUSTIN CHALK) Eagle Ford 5577 ft MURPHY EXPL. 448 509.0 88% JANYSEK UNIT # 12H KARNES 9/2/2016 9/30/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 5492 ft PARSLEY ENERGY 563 657.0 86% PETTIT '8A-8' #4401H REAGAN 3/18/2016 4/1/2016 SPRABERRY (TREND AREA) Midland - Permian 5049 ft PARSLEY ENERGY 1012 1182.3 86% ZAIN 26 #4214H UPTON 7/20/2016 7/28/2016 SPRABERRY (TREND AREA) R 40 EXC Midland - Permian 5086 ft PARSLEY ENERGY 913 1068.2 85% ZAIN 26 #4415H UPTON 7/20/2016 7/30/2016 SPRABERRY (TREND AREA) R 40 EXC Midland - Permian 5104 ft PIONEER NATURAL 771 881.3 87% MCCLINTIC 10G # 7H MIDLAND 8/11/2016 8/18/2016 SPRABERRY (TREND AREA) Midland - Permian 5553 ft PIONEER NATURAL 1104 1247.2 89% TEXAS TEN Y PU #3901H MIDLAND 6/6/2016 7/12/2016 SPRABERRY (TREND AREA) Midland - Permian 9753 ft PIONEER NATURAL 1580 1812.3 87% SHACKELFORD #3403H MIDLAND 7/20/2016 7/25/2016 SPRABERRY (TREND AREA) R 40 EXC Midland - Permian 9902 ft PMO 500 600.3 83% BELMONT STAKES # 1H BURLESON 9/26/2016 10/4/2016 AGUILA VADO (EAGLEFORD) Woodbine/ Buda/ East TX - Eagle Ford 5831 ft RESOLUTE NATURAL 1811 2557.5 71% SOUTH MITRE 2 UNIT #2102H REEVES 10/3/2016 11/4/2016 PHANTOM (WOLFCAMP) Delaware - Permian 9155 ft SEA EAGLE 500 539.5 93% PEELER RANCH EFS # 10HA ATASCOSA 9/17/2016 10/27/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 6170 ft SEA EAGLE 200 233.2 86% HOSKINS EFS # 1H MCMULLEN 9/28/2016 11/6/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 4800 ft SEA EAGLE 149 184.8 81% HOSKINS EFS # 3H MCMULLEN 9/28/2016 11/6/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5680 ft SEA EAGLE 79 88.0 90% TEAL RANCH EFS # 2H MCMULLEN 10/6/2016 11/1/2016 EAGLEVILLE (EAGLE FORD-1) Eagle Ford 5407 ft SHELL WESTERN 1224 1506.8 81% UNIVERSITY 19 A #2303H LOVING 10/19/2016 10/29/2016 PHANTOM (WOLFCAMP) Delaware - Permian 6015 ft SHELL WESTERN 595 917.3 65% GALAPAGOS 53-2-43 LOV # 1H LOVING 10/2/2016 10/10/2016 PHANTOM (WOLFCAMP) Delaware - Permian 4048 ft SN OPERATING, 184 193.0 95% PETRO PARDS # 5H ZAVALA 4/25/2016 5/2/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 6497 ft SN OPERATING, 228 235.7 97% PETRO PARDS # 6H ZAVALA 4/25/2016 4/27/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 6465 ft THOMPSON, J. 413 627.2 66% BIG GEORGE 180 # 3H REEVES 6/4/2016 7/15/2016 WOLFBONE (TREND AREA) Delaware - Permian 7576 ft THOMPSON, J. 658 1007.3 65% AGATE 179NE # 1H REEVES 7/27/2016 9/9/2016 WOLFBONE (TREND AREA) Delaware - Permian 7976 ft TIDAL PETROLEUM, 864 1021.2 85% JANYSEK # 1H KARNES 11/2/2016 11/15/2016 EAGLEVILLE (EAGLE FORD-2) Eagle Ford 3055 ft U.S. ENERGY 284 294.3 96% IRONWOOD A2 UNIT #A 2EF FRIO 4/29/2016 5/26/2016 BRISCOE RANCH (EAGLEFORD) Eagle Ford 6160 ft WILLIAMS, CLAYTON 1131 1282.8 88% GELTEMEYER 297 # 1H REEVES 9/5/2016 9/22/2016 HOEFS T-K (WOLFCAMP) Delaware - Permian 4737 ft WILLIAMS, CLAYTON 1390 1625.7 86% COLLIER 34-51 # 1H REEVES 7/17/2016 7/25/2016 HOEFS T-K (WOLFCAMP) Delaware - Permian 6284 ft XTO ENERGY 612 697.7 88% LHS RANCH #1715AH UPTON 10/31/2016 11/9/2016 SPRABERRY (TREND AREA) R 40 EXC Midland - Permian 9604 ft Source: Texas RRC
U.S. Independent E&Ps 54 Appendix: Other Useful Statistics Figure 79: CS Coverage Comp Sheet (As of 11/18/2016) Summary Valuation Table P riced as o f % P rice P ro ven EV/ EB IT D A EV/ EV/ EV/ % o f P ro ved R eserves P / E P / C F P S 11/ 18/ 2016 Stock Target Upside P erformance Dividend M rkt Enterprise Reserves Reserve X Reserves Flowing P V-10 Name Ticker Rating P rice P rice to TP YTD YoY Yield Cap Value (M M Boe U.S. Gas PD Life 16E 17E 16E 17E 16E 17E ($ / boe) ($ / boe) (YE15) UN IVER SE Anadarko Petroleum Corp. APC OUTPERFORM $61.45 $77 25% 26% 1% 0.33% $31,217 $45,996 2,057 90% 49% 79% 6.7 NM NM 11.4x 6.2x 11.6x 6.5x $22.37 $54.97 4.7x Antero Resources AR OUTPERFORM $24.60 $38 54% 13% 6% NA $6,742 $11,427 2,202 100% 72% 44% 24.2 36.6x 59.6x 6.1x 6.1x 9.5x 9.3x $5.19 $45.94 3.5x Apache Corp. APA NEUTRAL $61.40 $77 25% 38% 24% 1.63% $23,194 $30,504 1,564 54% 37% 59% 7.8 NM 66.1x 10.3x 6.7x 10.1x 6.7x $19.51 $55.41 2.9x Carrizo Oil & Gas Inc. CRZO NEUTRAL $36.26 $41 13% 23% -7% NA $1,887 $3,100 171 100% 24% 45% 12.7 38.6x 26.9x 7.3x 6.4x 9.2x 8.1x $18.17 $84.45 2.3x Chesapeake Energy Corp. CHK NEUTRAL $5.89 $7 19% 31% 0% 0.00% $4,575 $20,104 1,504 100% 67% 84% 6.1 NM 13.7x 6.3x 3.4x 13.0x 8.5x $13.37 $29.62 4.3x Continental Resources Inc. CLR NEUTRAL $49.63 $50 1% 116% 44% NA $18,356 $25,462 1,226 100% 43% 43% 15.2 NM 63.8x 14.8x 7.9x 14.8x 9.4x $20.77 $114.88 3.9x Callon Petroleum Co. CPE OUTPERFORM $14.38 $19 32% 72% 58% NA $945 $1,232 54 100% 20% 53% 15.5 48.8x 23.1x 7.5x 9.4x 12.6x 9.5x $22.70 $128.30 2.2x Concho Resources Inc. CXO OUTPERFORM $130.44 $160 23% 40% 20% NA $15,740 $18,843 623 100% 41% 57% 11.9 311.8x NM 12.4x 12.1x 12.5x 12.2x $30.22 $131.58 5.0x ConocoPhillips COP NEUTRAL $43.61 $53 22% -7% -19% 2.29% $54,211 $76,723 8,180 39% 35% 63% 14.1 NM NM 12.7x 7.0x 12.6x 8.1x $9.38 $48.27 3.0x Denbury Resources Inc. DNR UNDERPERFORM $3.00 $2-33% 49% -17% 0.00% $1,049 $4,324 289 100% 2% 79% 10.9 NM 123.9x 4.9x 3.5x 12.0x 9.4x $14.98 $59.34 2.3x Devon Energy Corp. DVN OUTPERFORM $42.87 $55 28% 34% -7% 0.56% $17,737 $28,540 2,182 75% 44% 83% 8.8 NM 41.9x 7.3x 7.6x 12.5x 7.7x $13.08 $41.95 4.3x Diamondback Energy Inc. FANG OUTPERFORM $97.92 $120 23% 46% 23% NA $6,174 $6,649 157 100% 16% 59% 13.0 72.5x 34.5x 23.0x 12.9x 22.4x 12.4x $42.38 $201.02 4.7x Energen Corp. EGN OUTPERFORM $56.39 $70 24% 38% -3% 0.00% $4,283 $5,058 355 100% 20% 52% 14.8 NM 238.9x 22.3x 10.3x 19.2x 10.5x $14.26 $76.83 2.5x EOG Resources Inc. EOG NEUTRAL $92.34 $96 4% 30% 11% 0.73% $50,670 $56,612 2,118 97% 30% 51% 10.1 NM 133.6x 20.7x 10.7x 22.8x 11.5x $26.73 $98.92 5.9x EP Energy EPE NEUTRAL $4.17 $4-4% -5% -30% NA $1,019 $5,117 546 100% 29% 47% 13.6 5.8x NM 1.4x 2.7x 5.2x 7.9x $9.37 $46.68 2.6x EQT Corporation EQT OUTPERFORM $66.90 $86 29% 28% 10% 0.18% $10,234 $11,426 1,663 100% 91% 63% 16.5 NM 109.5x 15.8x 9.7x 10.0x 7.5x $6.87 $41.50 11.7x Gulfport Energy Corp. GPOR OUTPERFORM $24.45 $37 51% 0% -15% NA $2,443 $3,276 284 100% 91% 45% 8.5 35.8x 23.9x 7.9x 6.1x 8.7x 7.0x $11.53 $35.91 4.3x Hess Corp. HES NEUTRAL $50.50 $65 29% 4% -16% 1.98% $14,323 $18,237 1,086 46% 24% 73% 7.9 NM NM 24.9x 8.6x 14.8x 9.1x $16.79 $48.65 2.5x Laredo Petroleum Inc. LPI UNDERPERFORM $14.03 $10-29% 76% 15% NA $2,792 $4,177 126 100% 29% 80% 7.7 28.5x 44.3x 9.8x 10.6x 10.3x 11.4x $33.23 $93.23 5.0x Marathon Oil Corp. MRO NEUTRAL $15.46 $20 29% 23% -13% 1.29% $10,470 $16,526 2,163 44% 19% 72% 13.8 NM NM 14.2x 5.9x 12.5x 7.1x $7.64 $38.43 2.7x Murphy Oil Corp. MUR NEUTRAL $30.30 $33 9% 35% 1% 3.30% $5,322 $8,098 774 40% 36% 62% 10.2 NM 352.8x 7.1x 4.5x 8.2x 5.3x $10.46 $38.94 2.1x Newfield Exploration Co. NFX OUTPERFORM $39.80 $53 33% 22% -1% NA $6,318 $8,780 509 98% 43% 65% 9.1 35.3x 18.9x 9.7x 7.9x 10.3x 9.0x $17.27 $57.29 3.2x Noble Energy Inc. NBL OUTPERFORM $35.34 $46.00 30% 7% -3% 1.13% $14,233 $21,181 1,421 62% 65% 66% 11.0 NM NM 8.7x 6.9x 8.6x 7.8x $14.91 $59.79 3.2x Oasis Petroleum Inc. OAS NEUTRAL $12.04 $13.00 8% 63% 2% NA $1,566 $3,859 218 100% 15% 68% 11.8 NM NM 6.4x 4.0x 9.9x 7.6x $17.68 $76.46 2.0x Occidental Petroleum Corp. OXY NEUTRAL $67.81 $67-1% 0% -9% 4.48% $51,920 $55,859 2,200 58% 26% 79% 9.1 NM 107.7x 13.9x 10.0x 18.1x 10.0x $25.39 $83.95 4.9x PDC Energy Inc PDCE OUTPERFORM $65.94 $79 20% 24% 12% NA $2,611 $3,252 273 100% 40% 26% 17.8 NM NM 7.1x 7.7x 7.8x 8.1x $11.92 $77.36 3.0x Parsley Energy PE OUTPERFORM $34.16 $42 23% 85% 81% NA $4,619 $4,831 124 100% 21% 42% 15.4 369.2x 60.9x 23.5x 12.8x 21.5x 12.3x $39.02 $219.77 8.1x Pioneer Natural Resources PXD OUTPERFORM $175.86 $216 23% 40% 24% 0.05% $26,246 $28,062 664 100% 34% 89% 8.9 NM 134.8x 17.3x 12.2x 16.1x 12.1x $42.24 $137.57 8.7x Range Resources Corp. RRC OUTPERFORM $34.03 $46 35% 38% 3% 0.24% $5,664 $8,315 1,649 100% 63% 55% 19.4 NM 52.8x 11.9x 8.3x 14.6x 9.9x $5.04 $35.76 3.1x Sanchez Energy Corp SN NEUTRAL $6.85 $8.00 17% 59% 27% NA $392 $1,704 128 100% 31% 51% 6.7 37.2x NM 2.5x 3.4x 5.6x 7.2x $13.35 $32.44 2.9x Southwestern Energy Co. SWN NEUTRAL $10.37 $13 25% 46% -5% NA $3,946 $8,660 1,036 100% 95% 93% 6.4 NM 15.4x 9.0x 4.9x 12.1x 7.4x $8.36 $19.42 3.6x Synergy Resources SYRG OUTPERFORM $8.16 $9 10% -4% -29% NA $775 $719 57 100% 51% 27% 16.6 NM 36.6x 31.2x 10.8x 27.4x 11.6x $12.69 $77.07 1.6x Whiting Petroleum Corp. WLL OUTPERFORM $9.13 $12 31% -3% -46% NA $1,784 $6,965 821 100% 14% 49% 13.8 NM NM 4.3x 4.6x 9.1x 8.5x $8.49 $42.69 1.5x Extraction Oil & Gas XOG OUTPERFORM $21.33 $30 41% #N/A NA NA $5,915 $6,456 159 100% 31% 19% 22.4 NM 233.2x 24.4x 8.1x 18.2x 7.9x $40.69 $333.13 14.7x UNIVERSE M EDIAN 23% 31% 1% 0.64% 100% 35% 59% 11.8 37.2x 56.2x 9.8x 7.6x 12.1x 8.5x $ 14.91 #### 3.2x UNIVERSE M EAN 19% 33% 4% 1.14% 88% 40% 61% 12.0 92.7x 81.1x 11.9x 7.6x 12.9x 9.0x $ 17.74 #### 3.9x UNIVERSE WEIGHTED M EAN 18% 26% 4% 1.32% 77% 40% 66% 11.0 159.7x 98.5x ### 8.6x 14.0x 9.0x $ 19.06 $ 71.36 4.3x Source: Thomson Reuters Datastream, Company data, Credit Suisse estimates
Figure 80: 2016 and 2017 Revenue per boe 2016 Rev/boe 2017 Rev/boe 2016 Median 2017 Median $50 $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 Note: Estimates assume $42.18/bbl crude oil and $2.45/MMbtu gas in 2016 and $55.00/bbl crude and $3.25/MMbtu gas in 2017. Figure 81: 2016 and 2017 EBITDAX per boe $35 2016 EBITDAX/boe 2017 EBITDAX/boe 2016 Median 2017 Median $30 $25 $20 $15 $10 $5 $0 Note: Estimates assume $42.18/bbl crude oil and $2.45/MMbtu gas in 2016 and $55.00/bbl crude and $3.25/MMbtu gas in 2017. U.S. Independent E&Ps 55
Figure 82: 2017 EBITDAX/boe vs. % oil (at Credit Suisse deck) $35 EBITDAX/boe $30 $25 $20 $15 CHK NBL SN NFX LPI APA HES CVX PXD CXO CRZO EOG EPE MUR OXY EGN XOG DVN PDCE APC SYRG COP XOM CLR MRO CPE PE FANG WLL OAS DNR $10 AR GPOR RRC SWN EQT $5 $0 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% % Oil *Note MRO and OXY include international gas U.S. Independent E&Ps 56
Figure 83: Total Oil Production (Mbbl/d) 3Q16/2Q16 3Q16/3Q15 4Q15 1Q16 2Q16 3Q16 QoQ YoY FY15 FY16 YoY FY17 FY18 Majors COP 922.0 929.0 897.0 927.0 3.3% 4.2% 912.8 911.2 (0.2%) 925.7 908.1 CVX 1,775.0 1,781.0 1,689.0 1,661.0 (1.7%) (1.0%) 1,744.0 1,721.2 (1.3%) 1,785.7 1,844.1 XOM 2,481.0 2,538.0 2,330.0 2,211.0 (5.1%) (5.1%) 2,345.0 2,367.5 1.0% 2,458.5 2,537.4 OXY 420.0 417.0 392.0 371.0 (5.4%) (14.9%) 428.8 393.0 (8.3%) 414.3 474.8 Sub-Total 5,598.0 5,665.0 5,308.0 5,170.0 (2.6%) (3.1%) 5,430.5 5,392.8 (0.7%) 5,584.3 5,764.4 Sequential Change 4.9% 1.2% (6.3%) (2.6%) 6.7% (0.7%) 3.6% 3.2% Large Cap E&P APA 253.7 247.1 236.8 217.6 (8.1%) (23.6%) 291.3 230.3 (20.9%) 228.5 246.6 APC 316.0 315.0 296.0 317.0 7.1% 5.3% 317.5 310.1 (2.3%) 433.6 466.3 AR 5.8 5.2 5.2 4.6 (12.2%) (35.9%) 5.7 4.9 (14.3%) 5.0 5.9 CHK 97.8 95.7 90.5 86.6 (4.3%) (24.1%) 113.2 91.4 (19.3%) 98.6 115.3 CLR 145.6 146.5 133.0 116.3 (12.6%) (21.2%) 146.6 131.4 (10.3%) 151.1 173.3 CXO 91.5 89.0 89.4 91.1 1.9% (6.3%) 94.4 92.4 (2.1%) 111.4 136.2 DVN 278.0 285.0 259.0 251.0 (3.1%) (11.0%) 275.5 259.2 (5.9%) 249.9 283.8 EOG 281.0 267.9 267.7 282.6 5.6% 1.1% 284.4 280.3 (1.5%) 329.8 402.1 HES 233.0 208.0 179.0 190.0 6.1% (22.1%) 238.3 188.0 (21.1%) 189.4 208.6 MRO 292.0 267.0 257.0 266.0 3.5% (13.6%) 298.5 259.1 (13.2%) 272.2 305.5 MUR 129.4 132.8 109.4 108.9 (0.4%) (20.4%) 137.4 112.6 (18.0%) 106.2 120.4 NBL 138.0 130.0 124.0 123.0 (0.8%) 9.8% 112.8 126.3 12.0% 131.8 141.5 PXD 113.0 122.8 134.7 134.2 (0.4%) 23.0% 105.3 133.2 26.5% 172.1 215.5 Sub-Total 2,374.7 2,312.0 2,181.8 2,188.9 0.3% (9.7%) 2,420.7 2,219.0 (8.3%) 2,479.6 2,820.9 Sequential Change (2.0%) (2.6%) (5.6%) 0.3% 7.1% (8.3%) 11.7% 13.8% SMID Cap E&P CPE 8.4 9.8 10.4 12.5 20.3% 67.3% 7.6 11.9 56.4% 17.5 23.7 CRZO 24.9 25.8 23.9 24.5 2.3% 3.9% 23.0 25.5 10.6% 31.0 35.7 DNR 68.4 66.1 62.0 60.1 (3.0%) (11.5%) 69.2 61.6 (10.9%) 57.6 56.9 EGN 39.0 34.5 36.5 35.8 (1.8%) (8.7%) 38.4 35.0 (8.9%) 42.5 53.0 EPE 56.5 50.8 45.1 45.0 (0.2%) (27.5%) 60.5 46.4 (23.4%) 44.6 46.2 EQT 2.2 1.8 2.2 2.0 (6.1%) 2.2% 2.0 2.0 (1.0%) 1.9 1.7 FANG 28.7 29.0 26.6 32.6 22.7% 30.7% 24.9 30.6 23.2% 39.9 51.4 GPOR 7.3 6.6 6.1 5.7 (6.5%) (28.8%) 7.9 5.9 (25.8%) 4.6 3.8 LPI 18.0 22.0 22.1 23.4 5.7% 16.6% 20.9 22.8 9.3% 25.8 28.3 NFX 76.1 76.9 74.7 69.6 (6.9%) (4.5%) 73.4 71.1 (3.2%) 70.3 86.4 OAS 43.3 42.5 41.2 39.4 (4.2%) (11.0%) 44.1 41.7 (5.5%) 53.5 58.3 PDCE 22.7 21.0 21.9 25.4 16.2% 16.5% 19.1 23.9 25.4% 35.6 47.4 PE 15.9 19.0 23.7 29.0 22.4% 131.5% 13.2 26.0 97.2% 40.4 56.8 RRC 9.8 9.3 9.3 8.8 (5.6%) (15.4%) 11.2 9.7 (13.6%) 12.6 14.5 SN 19.5 18.0 18.0 17.0 (5.5%) (6.5%) 19.6 17.4 (11.3%) 16.7 18.3 SWN 6.2 6.7 6.4 5.8 (9.5%) (4.6%) 6.2 6.1 (1.2%) 6.1 6.8 SYRG 6.0 5.8 5.6 5.6 0.7% (19.5%) 5.6 5.8 2.8% 11.0 17.8 WLL 118.2 109.5 95.8 84.3 (12.0%) (33.7%) 129.3 92.8 (28.3%) 86.3 94.5 XOG 12.5 13.8 13.8 14.0 1.3% 27.1% 10.8 14.9 38.1% 31.6 42.0 Sub-Total 583.5 569.0 545.3 526.7 (3.4%) (10.2%) 587.0 551.0 (6.1%) 629.3 743.6 Sequential Change (0.5%) (2.5%) (4.2%) (3.4%) 27.9% (6.1%) 14.2% 18.2% Total E&P 8,556 8,546 8,035 7,886 (1.9%) (5.5%) 8,438 8,163 (3.3%) 8,693 9,329 Sequential Change 2.5% (0.1%) (6.0%) (1.9%) 8.0% (3.3%) 6.5% 7.3% U.S. Independent E&Ps 57
Figure 84: Oil Growth % 3Q16/3Q15 3Q15 4Q15 1Q16 2Q16 3Q16 YoY Majors COP (1.8%) 3.6% 0.8% (3.4%) 3.3% 4.2% CVX (2.6%) 5.8% 0.3% (5.2%) (1.7%) (1.0%) XOM 1.7% 6.4% 2.3% (8.2%) (5.1%) (5.1%) OXY 0.7% (3.7%) (0.7%) (6.0%) (5.4%) (14.9%) Median (0.5%) 4.7% 0.5% (5.6%) (3.4%) (3.1%) Large Cap E&P APA (5.6%) (10.9%) (2.6%) (4.2%) (8.1%) (23.6%) APC (5.3%) 5.0% (0.3%) (6.0%) 7.1% 5.3% AR 25.0% (19.9%) (9.8%) 1.1% (12.2%) (35.9%) CHK (3.8%) (14.3%) (2.2%) (5.4%) (4.3%) (24.1%) CLR (1.6%) (1.3%) 0.6% (9.2%) (12.6%) (21.2%) CXO (2.0%) (5.9%) (2.7%) 0.5% 1.9% (6.3%) DVN 4.4% (1.4%) 2.5% (9.1%) (3.1%) (11.0%) EOG 0.7% 0.5% (4.7%) (0.1%) 5.6% 1.1% HES (0.8%) (4.5%) (10.7%) (13.9%) 6.1% (22.1%) MRO 10.0% (5.2%) (8.6%) (3.7%) 3.5% (13.6%) MUR 4.0% (5.5%) 2.7% (17.7%) (0.4%) (20.4%) NBL 15.5% 23.2% (5.8%) (4.6%) (0.8%) 9.8% PXD 8.5% 3.5% 8.7% 9.7% (0.4%) 23.0% Median 0.7% (4.5%) (2.6%) (4.6%) (0.4%) (13.6%) SMID Cap E&P CPE (0.5%) 12.8% 16.1% 6.3% 20.3% 67.3% CRZO 5.8% 5.8% 3.5% (7.2%) 2.3% 3.9% DNR (2.8%) 0.7% (3.3%) (6.3%) (3.0%) (11.5%) EGN (0.6%) (0.7%) (11.5%) 5.8% (1.8%) (8.7%) EPE (2.1%) (9.0%) (10.1%) (11.2%) (0.2%) (27.5%) EQT (4.2%) 9.2% (15.5%) 17.9% (6.1%) 2.2% FANG 12.9% 15.0% 0.9% (8.2%) 22.7% 30.7% GPOR (0.4%) (7.9%) (9.8%) (8.5%) (6.5%) (28.8%) LPI (5.9%) (10.2%) 22.5% 0.3% 5.7% 16.6% NFX (8.0%) 4.5% 1.1% (2.9%) (6.9%) (4.5%) OAS 0.6% (2.3%) (1.8%) (3.2%) (4.2%) (11.0%) PDCE 25.6% 4.0% (7.6%) 4.4% 16.2% 16.5% PE (3.6%) 26.8% 19.7% 24.6% 22.4% 131.5% RRC (13.0%) (6.4%) (4.9%) 0.6% (5.6%) (15.4%) SN (13.8%) 7.3% (7.6%) (0.3%) (5.5%) (6.5%) SWN (5.6%) 1.2% 7.9% (3.5%) (9.5%) (4.6%) SYRG 43.0% (14.2%) (3.2%) (3.6%) 0.7% (19.5%) WLL (6.9%) (7.1%) (7.3%) (12.4%) (12.0%) (33.7%) XOG 12.3% 13.1% 10.9% 0.0% 1.3% 27.1% Median (2.4%) 1.0% (3.3%) (3.0%) (2.4%) (5.6%) U.S. Independent E&Ps 58
Figure 85: 2015 2018E US Onshore Oil Volumes (Mbbl/d) Full Year Volumes % Change Ticker: 2015 2016 2017 2018 16/15 17/16 17/15 18/15 CVX 501.0 510.0 538.8 569.5 1.8% 5.6% 7.5% 13.7% XOM 475.5 499.8 547.0 586.3 5.1% 9.4% 15.0% 23.3% COP 470.5 454.4 449.9 432.7 (3.4%) (1.0%) (4.4%) (8.0%) EOG 283.3 275.5 322.5 395.2 (2.8%) 17.1% 13.8% 39.5% MRO 210.3 170.3 177.2 214.0 (19.0%) 4.1% (15.7%) 1.8% OXY 199.3 189.0 212.6 274.5 (5.1%) 12.5% 6.7% 37.8% APC 179.5 167.4 179.0 204.7 (6.7%) 6.9% (0.3%) 14.1% DVN 164.5 128.7 108.9 138.8 (21.8%) (15.4%) (33.8%) (15.7%) HES 147.5 122.4 120.3 125.7 (17.0%) (1.8%) (18.5%) (14.7%) CLR 146.6 131.4 151.1 173.3 (10.3%) 14.9% 3.0% 18.2% WLL 129.3 92.8 86.3 94.5 (28.3%) (7.0%) (33.2%) (26.9%) APA 123.7 103.7 100.1 111.7 (16.1%) (3.5%) (19.1%) (9.7%) CHK 113.2 91.4 98.6 115.3 (19.3%) 7.9% (12.9%) 1.8% PXD 105.3 133.2 172.1 215.5 26.5% 29.2% 63.5% 104.7% CXO 94.4 92.4 111.4 136.2 (2.1%) 20.6% 18.1% 44.3% NBL 80.0 99.7 106.9 118.0 24.7% 7.2% 33.7% 47.5% MUR 71.4 55.9 54.1 64.1 (21.7%) (3.0%) (24.1%) (10.2%) DNR 69.2 61.6 57.6 56.9 (10.9%) (6.6%) (16.8%) (17.8%) EPE 60.5 46.4 44.6 46.2 (23.4%) (3.9%) (26.4%) (23.6%) NFX 58.6 57.1 61.7 79.4 (2.6%) 8.1% 5.2% 35.4% OAS 44.1 41.7 53.5 58.3 (5.5%) 28.4% 21.3% 32.3% EGN 38.4 35.0 42.5 53.0 (8.9%) 21.4% 10.6% 38.0% FANG 24.9 30.6 39.9 51.4 23.2% 30.1% 60.3% 106.7% CRZO 23.0 25.5 31.0 35.7 10.6% 21.8% 34.7% 54.9% LPI 20.9 22.8 25.8 28.3 9.3% 12.9% 23.4% 35.6% SN 19.6 17.4 16.7 18.3 (11.3%) (4.3%) (15.1%) (6.6%) PDCE 19.1 23.9 35.6 47.4 25.4% 48.8% 86.6% 148.3% PE 13.2 26.0 40.4 56.8 97.2% 55.8% 207.3% 331.6% RRC 11.2 9.7 12.6 14.5 (13.6%) 30.7% 12.9% 29.6% XOG 10.8 14.9 31.6 42.0 38.1% 111.7% 192.3% 289.5% GPOR 7.9 5.9 4.6 3.8 (25.8%) (21.3%) (41.6%) (52.4%) CPE 7.6 11.9 17.5 23.7 56.4% 46.1% 128.6% 210.5% SWN 6.2 6.1 6.1 6.8 (1.2%) (0.8%) (2.0%) 10.3% AR 5.7 4.9 5.0 5.9 (14.3%) 2.2% (12.4%) 3.9% SYRG 5.6 5.8 11.0 17.8 2.8% 90.4% 95.8% 218.1% EQT 2.0 2.0 1.9 1.7 (1.0%) (7.2%) (8.1%) (18.6%) Total (Mbbl/d): 3,943.8 3,767.1 4,076.1 4,618.0 (4.5%) 8.2% 3.4% 17.1% % Change YoY 11.0% (4.5%) 8.2% 13.3% U.S. Independent E&Ps 59
Figure 86: Total Gas Production (MMcf/d) 3Q16/2Q16 3Q16/3Q15 4Q15 1Q16 2Q16 3Q16 QoQ YoY FY15 FY16 YoY FY17 FY18 Majors COP 4,062.0 3,895.0 3,893.0 3,777.0 (3.0%) (5.2%) 4,060.0 3,842.5 (5.4%) 3,772.3 3,924.2 CVX 5,385.0 5,310.0 5,031.0 5,113.0 1.6% (1.0%) 5,269.0 5,269.2 0.0% 6,071.9 6,786.1 XOM 10,603.0 10,724.0 9,762.0 9,601.0 (1.6%) 0.8% 10,520.8 10,094.2 (4.1%) 9,818.8 9,616.8 OXY 1,013.0 984.0 1,073.0 888.0 (17.2%) (14.2%) 983.3 947.4 (3.6%) 916.0 1,050.6 Sub-Total 21,063.0 20,913.0 19,759.0 19,379.0 (1.9%) (1.7%) 20,833.0 20,153.2 (3.3%) 20,578.9 21,377.7 Sequential Change 6.9% (0.7%) (5.5%) (1.9%) (2.8%) (3.3%) 2.1% 3.9% Large Cap E&P APA 1,032.8 1,002.4 966.1 934.8 (3.2%) (19.6%) 1,188.8 957.7 (19.4%) 1,063.3 1,357.6 APC 2,068.0 2,303.0 2,188.0 2,003.0 (8.5%) (8.4%) 2,336.5 2,049.6 (12.3%) 1,739.6 1,788.5 AR 1,168.0 1,347.0 1,311.0 1,386.0 5.7% 16.3% 1,203.3 1,355.6 12.7% 1,655.1 2,015.5 CHK 2,913.0 3,036.0 2,960.0 2,914.0 (1.6%) 1.9% 2,932.3 2,845.5 (3.0%) 2,414.6 2,556.6 CLR 476.2 506.0 517.7 549.4 6.1% 13.3% 450.2 515.6 14.5% 479.9 522.5 CXO 314.9 302.8 334.4 370.6 10.8% 18.6% 292.9 351.3 19.9% 411.5 480.5 DVN 1,583.0 1,581.0 1,527.0 1,324.0 (13.3%) (16.5%) 1,610.3 1,410.1 (12.4%) 1,237.8 1,337.3 EOG 1,257.0 1,218.0 1,194.0 1,144.0 (4.2%) (10.2%) 1,265.3 1,183.2 (6.5%) 1,220.9 1,281.7 HES 571.0 571.0 539.0 472.0 (12.4%) (17.8%) 584.0 529.1 (9.4%) 566.3 616.3 MRO 812.0 697.0 767.0 804.0 4.8% 3.2% 789.5 762.6 (3.4%) 794.2 811.4 MUR 432.5 383.2 364.6 382.0 4.8% (10.7%) 427.6 377.9 (11.6%) 394.3 414.0 NBL 1,349.0 1,371.0 1,433.0 1,445.0 0.8% 13.3% 1,186.5 1,400.4 18.0% 1,336.5 1,347.5 PXD 366.8 358.7 340.5 332.4 (2.4%) (7.7%) 360.6 345.2 (4.3%) 369.6 415.0 Sub-Total 14,344.3 14,677.1 14,442.4 14,061.2 (2.6%) (2.8%) 14,627.7 14,083.7 (3.7%) 13,683.5 14,944.5 Sequential Change (0.9%) 2.3% (1.6%) (2.6%) (0.4%) (3.7%) (2.8%) 9.2% SMID Cap E&P CPE 12.9 15.9 18.2 24.4 33.9% 81.1% 11.8 21.3 80.2% 31.1 40.6 CRZO 67.1 70.0 74.2 69.3 (6.7%) 33.9% 59.8 70.4 17.8% 69.3 73.1 DNR 21.6 19.3 15.3 14.9 (3.0%) (29.4%) 22.2 15.9 (28.2%) 14.0 13.7 EGN 85.1 65.6 60.9 62.0 1.7% (22.6%) 97.8 61.4 (37.1%) 65.3 83.7 EPE 239.0 232.0 153.0 121.0 (20.9%) (44.0%) 206.7 156.1 (24.5%) 121.6 128.1 EQT 1,536.4 1,816.2 1,843.3 1,904.3 3.3% 23.9% 1,498.6 1,864.8 24.4% 2,057.1 2,497.6 FANG 26.2 25.5 28.2 29.1 3.0% 26.0% 21.7 28.7 32.1% 37.0 47.7 GPOR 532.0 585.8 579.9 632.1 9.0% 20.8% 426.9 623.3 46.0% 804.3 1,221.0 LPI 66.9 74.7 77.3 84.4 9.1% 14.6% 73.5 80.4 9.5% 89.0 95.2 NFX 354.3 378.0 371.4 387.0 4.2% 10.9% 339.6 367.4 8.2% 333.1 357.9 OAS 44.2 46.7 50.0 54.4 8.9% 45.6% 38.3 53.7 40.1% 79.4 89.3 PDCE 112.0 117.3 139.3 145.8 4.7% 46.7% 91.1 138.4 51.9% 178.7 221.8 PE 29.5 32.4 34.7 38.6 11.4% 35.2% 28.3 36.8 30.1% 48.5 62.7 RRC 1,056.3 932.6 912.1 1,015.9 11.4% (3.9%) 993.0 1,035.5 4.3% 1,451.4 1,751.0 SN 123.7 119.7 127.5 115.2 (9.7%) 5.0% 102.9 119.4 16.1% 125.0 137.8 SWN 2,456.5 2,340.7 2,230.8 2,054.3 (7.9%) (17.1%) 2,462.9 2,157.2 (12.4%) 2,098.8 2,184.2 SYRG 28.0 34.3 33.1 31.0 (6.3%) 31.0% 22.4 32.8 46.4% 55.1 90.3 WLL 115.3 115.5 118.8 107.7 (9.3%) 4.0% 112.7 111.9 (0.7%) 112.0 122.6 XOG 38.9 38.7 49.9 52.1 4.4% 74.1% 29.6 51.8 74.9% 98.0 143.8 Sub-Total 6,945.8 7,060.9 6,918.0 6,891.3 (0.4%) 0.5% 6,639.7 7,027.2 5.8% 7,868.6 9,362.2 Sequential Change 1.3% 1.7% (2.0%) (0.4%) 23.9% 5.8% 12.0% 19.0% Total E&P 42,353 42,651 41,119 40,332 (1.9%) (1.7%) 42,100 41,264 (2.0%) 42,131 45,684 Sequential Change 3.2% 0.7% (3.6%) (1.9%) 1.5% (2.0%) 2.1% 8.4% U.S. Independent E&Ps 60
Figure 87: Total NGL Production (bbl/d) 3Q16/2Q16 3Q16/3Q15 4Q15 1Q16 2Q16 3Q16 QoQ YoY FY15 FY16 YoY FY17 FY18 FY16 Large Cap E&P % Total Production APA 67.2 64.5 63.0 65.2 3.6% 2.2% 61.1 63.6 4.1% 71.3 87.0 14.0% APC 118.0 128.0 131.0 129.0 (1.5%) 5.7% 129.8 124.4 (4.1%) 115.9 122.6 16.0% AR 49.0 63.3 69.8 76.9 10.1% 70.5% 42.6 71.9 69.0% 93.2 110.5 23.8% CHK 76.1 70.7 73.2 65.7 (10.2%) (13.7%) 76.7 67.1 (12.5%) 58.2 61.2 10.6% DVN 139.0 137.0 131.0 104.0 (20.6%) (22.4%) 136.5 115.1 (15.7%) 96.0 111.2 18.9% EOG 79.1 79.4 84.3 81.9 (2.8%) 5.3% 77.0 81.7 6.1% 91.6 108.7 14.6% HES 40.0 47.0 44.0 45.0 2.3% 12.5% 39.2 44.1 12.3% 38.6 38.1 13.8% NBL 59.0 57.0 64.0 62.0 (3.1%) 12.7% 43.8 60.2 37.7% 66.9 72.3 14.3% PXD 40.6 39.2 41.2 49.2 19.4% 18.3% 38.6 43.0 11.5% 45.2 52.5 18.4% Sub-Total 668.0 686.1 701.5 678.9 (3.2%) 3.6% 645.1 671.1 4.0% 676.9 764.0 Sequential Change 1.9% 2.7% 2.2% (3.2%) 26.6% 4.0% 0.9% 12.9% SMID Cap E&P CRZO 4.0 4.5 5.2 4.7 (9.4%) 25.9% 3.7 4.9 32.1% 5.9 6.5 11.6% EGN 11.7 8.7 9.4 10.4 10.8% (9.3%) 11.1 9.5 (14.3%) 11.2 14.1 17.4% EPE 16.4 14.5 13.9 14.4 3.6% (11.7%) 14.7 14.2 (3.0%) 14.1 14.6 16.4% EQT 21.7 25.0 28.6 35.8 25.1% 43.0% 23.5 30.4 29.0% 31.2 34.6 8.8% FANG 4.5 5.1 5.5 7.5 34.6% 41.4% 4.6 6.5 40.8% 9.0 11.6 15.4% GPOR 11.3 11.1 8.1 11.3 40.5% (10.7%) 12.1 10.4 (14.6%) 11.3 12.5 8.6% LPI 11.2 11.7 12.7 13.8 9.1% 10.6% 11.7 13.0 11.6% 14.9 16.2 26.5% NFX 26.1 27.5 30.8 31.5 2.4% 26.1% 23.3 29.7 27.7% 30.5 33.8 18.3% PDCE 10.6 9.7 12.0 15.5 29.3% 80.1% 7.8 13.4 73.0% 20.0 25.1 22.2% PE 4.4 4.7 6.2 7.6 21.5% 76.8% 4.1 6.6 60.2% 8.7 10.6 17.0% RRC 53.3 65.7 75.4 73.3 (2.9%) 35.2% 55.8 74.4 33.3% 91.7 109.3 29.0% SN 18.0 18.6 16.7 15.3 (8.1%) (6.4%) 15.7 16.4 4.4% 16.4 18.3 30.6% SWN 36.2 37.1 34.5 33.3 (3.2%) 1.1% 29.3 34.1 16.7% 32.7 34.2 8.5% WLL 17.8 18.0 18.6 17.6 (5.3%) 11.2% 15.1 17.9 18.8% 18.4 20.1 13.8% XOG 5.2 4.5 5.5 6.2 14.2% 55.7% 3.7 6.0 64.4% 11.6 17.6 20.3% Sub-Total 252.5 266.4 283.1 298.4 5.4% 20.1% 236.1 287.5 21.8% 327.7 379.0 Sequential Change 1.7% 5.5% 6.3% 5.4% 56.5% 21.8% 14.0% 15.7% Total E&P 921 953 985 977 (0.7%) 8.1% 881 959 8.8% 1,005 1,143 Sequential Change 1.9% 3.5% 3.4% (0.7%) 33.5% 8.8% 4.8% 13.8% U.S. Independent E&Ps 61
Figure 88: 2015 2018E Capex Estimates Capex ($MM) % Change Ticker: 2015 2016 2017 2018 16/15 17/16 17/15 18/15 COP $10,050 $5,199 $4,913 $5,084 (48.3%) (5.5%) (51.1%) (49.4%) APC $6,067 $3,394 $4,129 $4,597 (44.1%) 21.7% (31.9%) (24.2%) DVN $5,308 $2,136 $2,892 $3,345 (59.8%) 35.4% (45.5%) (37.0%) EOG $5,013 $2,800 $4,500 $6,000 (44.1%) 60.7% (10.2%) 19.7% APA $4,811 $2,030 $3,218 $3,998 (57.8%) 58.5% (33.1%) (16.9%) OXY $4,522 $3,171 $3,681 $4,632 (29.9%) 16.1% (18.6%) 2.4% HES $4,321 $2,339 $2,756 $3,342 (45.9%) 17.8% (36.2%) (22.6%) MRO $3,476 $1,432 $2,217 $2,769 (58.8%) 54.8% (36.2%) (20.3%) CHK $3,238 $1,750 $2,200 $2,700 (46.0%) 25.7% (32.1%) (16.6%) CLR $3,043 $1,098 $2,074 $2,472 (63.9%) 88.9% (31.8%) (18.7%) NBL $2,979 $1,450 $2,200 $2,700 (51.3%) 51.7% (26.1%) (9.4%) MUR $2,550 $626 $963 $1,297 (75.4%) 53.8% (62.2%) (49.1%) WLL $2,455 $550 $700 $1,050 (77.6%) 27.3% (71.5%) (57.2%) EQT $2,434 $1,490 $2,200 $2,615 (38.8%) 47.6% (9.6%) 7.4% AR $2,348 $1,880 $1,900 $2,300 (19.9%) 1.1% (19.1%) (2.0%) PXD $2,110 $2,100 $2,750 $3,200 (0.5%) 31.0% 30.3% 51.7% CXO $1,900 $1,300 $1,525 $1,975 (31.6%) 17.3% (19.7%) 3.9% SWN $1,798 $750 $1,050 $1,300 (58.3%) 40.0% (41.6%) (27.7%) NFX $1,607 $850 $1,000 $1,400 (47.1%) 17.6% (37.8%) (12.9%) GPOR $1,593 $525 $750 $950 (67.0%) 42.9% (52.9%) (40.4%) EPE $1,433 $490 $450 $550 (65.8%) (8.2%) (68.6%) (61.6%) EGN $1,154 $485 $800 $850 (58.0%) 64.9% (30.7%) (26.4%) RRC $1,035 $569 $920 $1,300 (45.0%) 61.7% (11.1%) 25.6% OAS $820 $400 $450 $550 (51.2%) 12.5% (45.1%) (32.9%) CRZO $676 $435 $375 $450 (35.6%) (13.8%) (44.5%) (33.4%) SN $656 $275 $300 $320 (58.1%) 9.1% (54.3%) (51.2%) PDCE $605 $450 $700 $950 (25.6%) 55.6% 15.8% 57.1% LPI $588 $420 $480 $470 (28.6%) 14.3% (18.4%) (20.1%) FANG $420 $425 $575 $800 1.3% 35.3% 37.1% 90.7% XOG $414 $380 $650 $750 (8.3%) 71.1% 56.9% 81.0% PE $383 $475 $650 $800 24.2% 36.8% 69.9% 109.1% SYRG $276 $145 $325 $400 (47.4%) 124.1% 17.8% 45.0% CPE $227 $150 $280 $350 (34.0%) 86.7% 23.2% 54.0% Total ($MM) $80,309 $41,970 $54,573 $66,266 (47.7%) 30.0% (32.0%) (17.5%) U.S. Independent E&Ps 62
Figure 89: 2015 2018E Cash Flow Estimates Cash Flow ($MM) % Change Ticker: 2015 2016 2017 2018 16/15 17/16 17/15 18/15 COP $7,572 $4,270 $7,675 $9,659 (43.6%) 79.7% 1.4% 27.6% DVN $5,383 $3,028 $2,959 $4,231 (43.7%) (2.3%) (45.0%) (21.4%) EOG $3,741 $2,470 $4,951 $7,288 (34.0%) 100.5% 32.4% 94.8% OXY $3,351 $3,736 $5,194 $6,368 11.5% 39.0% 55.0% 90.0% APC $2,323 $2,802 $5,495 $7,092 20.6% 96.1% 136.6% 205.3% CHK $2,268 $923 $1,723 $2,867 (59.3%) 86.7% (24.0%) 26.4% NBL $2,168 $1,753 $2,196 $2,917 (19.2%) 25.3% 1.3% 34.5% HES $1,981 $670 $1,888 $2,884 (66.2%) 182.0% (4.7%) 45.6% CLR $1,857 $1,238 $2,324 $3,143 (33.3%) 87.7% 25.1% 69.3% MRO $1,565 $892 $2,220 $3,159 (43.0%) 148.8% 41.8% 101.9% SWN $1,468 $609 $1,132 $1,508 (58.5%) 85.8% (22.9%) 2.7% EPE $1,331 $749 $379 $409 (43.7%) (49.4%) (71.5%) (69.3%) PXD $1,270 $1,690 $2,451 $3,604 33.1% 45.0% 93.0% 183.8% EQT $1,217 $1,031 $1,510 $2,219 (15.3%) 46.5% 24.1% 82.4% NFX $1,171 $798 $1,004 $1,544 (31.9%) 25.9% (14.2%) 31.8% MUR $1,168 $730 $1,149 $1,603 (37.5%) 57.3% (1.7%) 37.2% WLL $1,020 $527 $726 $1,070 (48.3%) 37.8% (28.8%) 4.9% AR $976 $1,198 $1,265 $2,032 22.7% 5.6% 29.6% 108.1% CXO $862 $1,426 $1,579 $2,214 65.3% 10.7% 83.1% 156.7% APA $850 $2,269 $3,463 $4,394 166.9% 52.6% 307.4% 416.9% EGN $715 $240 $536 $851 (66.5%) 123.5% (25.0%) 19.1% RRC $701 $541 $1,005 $1,552 (22.8%) 85.8% 43.4% 121.5% PDCE $421 $458 $562 $891 8.9% 22.6% 33.6% 111.8% FANG $419 $317 $593 $931 (24.2%) 87.1% 41.7% 122.2% CRZO $377 $301 $375 $551 (20.3%) 24.5% (0.7%) 46.1% OAS $360 $347 $695 $752 (3.4%) 99.9% 93.0% 109.0% LPI $358 $327 $325 $426 (8.7%) (0.4%) (9.1%) 19.0% GPOR $339 $379 $505 $912 12.0% 33.1% 49.1% 169.4% SN $272 $180 $134 $233 (33.9%) (25.7%) (50.9%) (14.3%) PE $172 $283 $564 $980 64.2% 99.6% 227.7% 469.2% XOG $167 $140 $422 $815 (16.3%) 202.6% 153.4% 389.2% SYRG $125 $45 $151 $319 (63.8%) 233.3% 20.8% 155.3% CPE $87 $249 $254 $422 186.2% 2.3% 192.9% 385.8% Total ($MM) $48,054 $36,616 $57,405 $79,840 (23.8%) 56.8% 19.5% 66.1% U.S. Independent E&Ps 63
U.S. Independent E&Ps 64 Figure 90: Leading Edge Completion Tracker Proppant Fluid Basin / Play Sub-Play Operator Lbs/ft bbls/ft Stage Spacing Well Spacing Perf Cluster Spacing Lateral Length Style Well Cost: Bakken MB / TFS EOG na na na 650' na 8,400' High Density Frac $4.8 Bakken MB / TFS1 OAS 400 22 278' 704' na 10,000' Slickwater $6.1 Bakken MB / TFS1 OAS 900 15 200' 704' na 10,000' High Volume Proppant $6.1 Bakken MB / TFS WLL 880 ~20 na 880' na 10,000' Slickwater $6.8 Delaware Avalon CXO 2,000 na na 660' na 5,000' na $2.5 Delaware WC A/B EGN 1,800-2,400 40 200' 880' 33' 7,500' na $6.5 Delaware WC A/B EGN 1,800-2,400 40 200' 880' 33' 10,000' na $7.6 Delaware WC A/B EGN 1,600-1,700 39 260' 880' 65 7,500' na $5.9 Delaware WC A/B EGN 1,600-1,700 39 260' 880' 65 10,000' na $6.9 Delaware Wolfcamp Combo EOG na na na 660' na 7,000' High Density Frac $7.8 Delaware Wolfcamp Oil EOG na na na 880' na 8,300' High Density Frac $8.0 Delaware 2nd BS EOG na na na 850' na 7,000' High Density Frac $7.3 Delaware Leonard / Avalon EOG na na na 660' na 6,800' High Density Frac $6.3 Delaware WC FANG 1,500-2,000 na na 880' na 9,500' Slickwater $5.5 Delaware Wolfcamp A NBL 1,800 na na na 40'-60' 4,000' Slickwater/ Hypergel na Delaware WC A / B / C PDCE 2,000 na na 440'-1,320' 100' 5,300' Slickwater + Linear gel $6.5 Delaware WC A PE 1,800-1,900 na 160'-170' 660' na 7,000' Slickwater $5.7 Delaware Lower & Upper WC XEC 2,400 ~45 na 660' na 10,000' na $10.2-11.2 Delaware Lower & Upper WC XEC 1,640 na na 660' na 10,000' na $10.2-11.2 DJ Niobrara / Codell BCEI 1,500 na na na na 4,000' Plug n perf 2.4-2.5 DJ Niobrara / Codell CRZO na na na 300'-450' na 4,200' Slickwater $2.4 DJ Niobrara NBL 1,100-1,800 25 na na na 4,500' Slickwater $2.6 DJ Niobrara PDCE 1,100-1,800 25 na 660' na 4,200' Slickwater $2.5 Eagle Ford Lower EF CHK na na na na na 9,300' Switching to Slickwater $4.0 Eagle Ford Lower EF CRZO 1,500-1,600 na 233' 325'-500' na 6,250' Slickwater $4.2 Eagle Ford Lower EF EOG 2,500 45 na 320' na 5,300' na $4.5 Eagle Ford Lower EF EPE 2,000 na 200' 660' na 5,300' na $5.1 Eagle Ford Lower EF NBL 2,100 na na 500'-1,000' 20'-40' 5300' Slickwater na Eagle Ford Lower EF SN 1,600 na na 800' na 5,000' na $3.3 Haynesville CHK 3,000-5,000 na na na na 10,000' Switching to slickwater $9.1 Marcellus AR 1,500 45 200' 750' na 9,000' na $8.1 Marcellus NBL na na na na na 10,000' na na Marcellus Super Rich RRC 1,500 33 200' 1,000' na 6,500' na $5.9 Marcellus Wet RRC 1,500 35 200' 1,000' na 7,000' na $5.8 Marcellus Dry RRC 1,500 35 200' 1,000' na 7,000' na $5.2 Marcellus SWN 2,000 na na na na 6,500' na $6.5 Midland WC CPE 1,500-1,700 na 200' na na 7,500' Slickwater with a bit of gel $5.0 Midland Spraberry CPE 2,000 na 200' 406' na 7,500' Slickwater with a bit of gel $5.0 Midland WC CPE 1,959 na 209' na na 7,718' na na Midland WC / LSB CXO 1,800 na na 660' na 10,000' na na Midland WC / LSB CXO 2,300 na na 660' na 6,200' na na Midland WC / LSB / MSB / Jo Mill EGN 1,700-2,000 40-45 150' 660'-880' 30' 10,000' na $8.0 Midland WC EPE 2,000 na 185' 660' na 7,500' na $4.7 Midland LSB / WC FANG 1,600 na na 660' na 7,600' Slickwater $5.5 Midland Upper WC LPI 1,690 na na 660' na 10,000' Long reach slickwater $6.3 Midland Middle WC LPI 1,730 na na 660' na 10,000' Long reach slickwater $6.3 Midland Cline LPI 1,770 na na 660' na 10,000' Long reach slickwater $6.3 Midland WC / LSB PE 1,600-1,700 na na 660' na 7,000' Slickwater $4.8 Midland WC A / WC B / LSB PXD 1,700 50 100' 800'-1,120' 15' 9,000' Slickwater $7.0 STACK Meramec / Oswego CHK 2,300 na na na 20'-30' 8,000' Switching to slickwater $9.1 STACK DVN 2,000 na 150' na 20 10,000' Slickwater w/ diversion STACK Meramec NFX 2,400 na na 880'-1,050' 50' 10,000' na $6.8 Utica AR 1,500 50 175' 1,000' na 9,000' na $9.4 Utica CRZO na na na 800' na 8,000' Slickwater $8.6 Utica Dry GPOR 1,800 na na 1,000' na 8,000' na $9.0 Utica Condensate / Wet Gas PDCE na na 200' na na 8,000' Hybrid/slickwater $6.5
Rig Count Figure 91: Total US Rig Count by Basin As of 11/18/16 DJ-Niobrara (lhs) Eagle Ford (lhs) Haynesville (lhs) Marcellus (lhs) Permian (lhs) Utica (lhs) Williston (lhs) Total US (rhs) 11/18/2016: 18 38 23 34 229 19 34 588 10/21/2016: 17 33 17 34 212 15 30 553 11/20/2015: 27 75 28 43 225 20 63 757 YoY Change: -33% -49% -18% -21% 2% -5% -46% -22% MoM Change 6% 15% 35% 0% 8% 27% 13% 6% Peak: 64 259 161 143 568 50 224 2026 Trough: 12 29 12 21 134 8 22 404 Total US (rhs) Permian (lhs) Eagle Ford (lhs) Williston (lhs) Marcellus (lhs) Haynesville (lhs) DJ-Niobrara (lhs) Utica (lhs) 600 2,500 500 2,000 400 1,500 300 1,000 200 100 500 0 0 2/4/2011 4/4/2011 6/4/2011 8/4/2011 10/4/2011 12/4/2011 2/4/2012 4/4/2012 6/4/2012 8/4/2012 10/4/2012 12/4/2012 2/4/2013 4/4/2013 6/4/2013 8/4/2013 10/4/2013 12/4/2013 2/4/2014 4/4/2014 6/4/2014 8/4/2014 10/4/2014 12/4/2014 2/4/2015 4/4/2015 6/4/2015 8/4/2015 10/4/2015 12/4/2015 2/4/2016 4/4/2016 6/4/2016 8/4/2016 10/4/2016 Source: Baker Hughes, Credit Suisse estimates U.S. Independent E&Ps 65
Figure 92: Weekly US Horizontal Rig Count (As of 11/18/2016) 1,600 1,400 1,200 1,000 Horizontal Rig count is now 470 as of 11/18/16, 6% higher MoM, 19% lower YoY, and 66% below the peak. 800 600 400 200 0 Source: Baker Hughes, Credit Suisse estimates Figure 93: US Weekly Natural Gas v. Oil Rig Count Natural Gas Rigs Oil Rigs 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Gas Rig count is now 116 as of 11/18/16, 7% higher MoM, 40% lower YoY, and 93% off peak levels. Oil Rig count is now 471 as of 11/18/16, 6% higher MoM, 16% lower YoY, and 71% off peak levels. Source: Baker Hughes, Credit Suisse estimates U.S. Independent E&Ps 66