Investor Update May 4, 2017
Cautionary Statement Regarding Forward-Looking Statements This presentation includes certain forward-looking statements and projections of EP Energy. EP Energy has made every reasonable effort to ensure that the information and assumptions on which these statements and projections are based are current, reasonable, and complete. However, a variety of factors could cause actual results to differ materially from the projections, anticipated results or other expectations expressed, including, without limitation, the volatility of, and sustained low oil, natural gas, and NGL prices; the supply and demand for oil, natural gas and NGLs; changes in commodity prices and basis differentials for oil and natural gas; EP Energy s ability to meet production volume targets; the uncertainty of estimating proved reserves and unproved resources; the future level of service and capital costs; the availability and cost of financing to fund future exploration and production operations; the success of drilling programs with regard to proved undeveloped reserves and unproved resources; EP Energy s ability to comply with the covenants in various financing documents; EP Energy s ability to obtain necessary governmental approvals for proposed E&P projects and to successfully construct and operate such projects; actions by the credit rating agencies; credit and performance risks of EP Energy s lenders, trading counterparties, customers, vendors, suppliers, and third party operators; general economic and weather conditions in geographic regions or markets served by EP Energy, or where operations of EP Energy are located, including the risk of a global recession and negative impact on oil and natural gas demand; the uncertainties associated with governmental regulation, including any potential changes in federal and state tax laws and regulation; competition; and other factors described in EP Energy s Securities and Exchange Commission filings. While EP Energy makes these statements and projections in good faith, neither EP Energy nor its management can guarantee that anticipated future results will be achieved. Reference must be made to those filings for additional important factors that may affect actual results. EP Energy assumes no obligation to publicly update or revise any forward-looking statements made herein or any other forward-looking statements made by EP Energy, whether as a result of new information, future events, or otherwise. This presentation presents certain production and reserves-related information on an "equivalency" basis. Equivalent volumes are computed with natural gas converted to barrels at a ratio of six Mcf to one Bbl. These conversions are based on energy equivalency conversion methods primarily applicable at the burner tip and do not represent value equivalencies at the wellhead. Although these conversion factors are industry accepted norms, they are not reflective of price or market value differentials between product types. This presentation refers to certain non-gaap financial measures such as Adjusted EBITDAX, Adjusted Cash Operating Costs, Adjusted EPS, and Adjusted General and Administrative Expenses. Definitions of these measures and reconciliation between U.S GAAP and non-gaap financial measures are included in the First Quarter 2017 Financial and Operational Reporting Package at epenergy.com. 2
Brent Smolik Chairman, President and CEO 3
Continued Execution Delivered results ahead of expectations Operational Continued oil production growth Improved well results in all areas Increased activities in all areas Improved operating efficiencies and LOE Completed Wolfcamp drilling JV Generated $172MM of Adjusted EBITDAX Financial Liquidity improved to $1.2B from 12/31/16 Extended debt maturities Reaffirmed borrowing base at current level and obtained covenant relief through 1Q 19 Added 2018 price support, >50% oil volumes floored @ $60 Off to a great start with continued improvement on all fronts Note: See the First Quarter 2017 Financial and Operational Reporting Package, available at epenergy.com, for the Company s non-gaap reconciliations and definitions. 4
1Q 17 Operations Summary Program Completed Wells Equivalent Production (MBoe/d) Oil (MBbls/d) NGLs (MBbls/d) Natural Gas (MMcf/d) $MM Eagle Ford 30 37.7 23.9 7.0 41 Eagle Ford $92 Wolfcamp $40 Wolfcamp 11 27.5 11.1 7.4 54 Altamont 3 17.3 11.9-32 Total Company 44 82.5 46.9 14.4 127 Altamont $20 1Q 17 Total Capital $152MM Increased Eagle Ford completions in 1Q 17 Expect to increase Wolfcamp completions throughout 17 5
Continued Oil Growth Oil Production (MBbls/d) 2017 activities 50.8 45.1 45.0 45.7 46.9 1H 17: Increased Eagle Ford, moderate Wolfcamp 32.4 27.3 24.0 22.2 23.9 2H 17: Increase Wolfcamp, moderate Eagle Ford Full Year 2017 7.0 6.8 9.3 11.4 11.1 Eagle Ford and Altamont at maintenance levels 11.4 11.0 11.7 12.1 11.9 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 Altamont Wolfcamp Eagle Ford Excess cash flow shifted to Wolfcamp growth 6
Execution Efficiency Altamont Eagle Ford Wolfcamp $6.2 $7.2 $5.8 $4.2 $4.0 FY'14 FY'15 FY'16 2017E $5.2 Gross Well Cost 1 ($MM) $5.3 $4.6 $4.9 FY'14 FY'15 FY'16 2017E $4.1 $4.1 $4.3 Longer laterals $16.35 Increased efficiencies Deeper wells Adjusted Cash Operating Costs ($/Boe) $2.78 $3.28 $4.20 $2.61 $3.19 $3.99 $6.10 $5.37 2017 Guidance Mid-point 1Q'17 LOE Transportation and commodity purchases Adjusted G&A Taxes, other than income taxes $15.16 FY'14 FY'15 FY'16 2017E Note: See the First Quarter 2017 Financial and Operational Reporting Package, available at epenergy.com, for the Company s non-gaap reconciliations and definitions. 1 Includes drilling, completing and well site facilities 7
Asset Programs Clay Carrell Executive VP and COO 8
Eagle Ford: Capital Efficient Program 40 30 Oil (MBbls/d) 20 10 0 Efficient Capital Drives Oil Growth 32.4 27.3 24.0 22.2 23.9 $92 $75 $32 $43 $25 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 250 225 200 Capex ($MM) 175 150 125 100 75 50 25 - Averaged 1 rig and 2 frac crews Resumed production growth Significant increase in well completions Accelerated DUC development Current cost advantage Most completions since 2Q 15 Base production beating expectations Increased completion efficiencies Favorable results from longer laterals and increased proppant loading 9
Altamont: Consistent Results Oil Production (MBbls/d) Averaged 1 JV rig and picked up 2 nd rig in late Feb. along with 1 frac crew 11.4 11.0 11.7 12.1 11.9 3 new well completions 16 recompletions 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 Strong program returns Completions 2 2 7 4 3 On-going drilling JV Successful recompletion program Significantly improved realized prices 10
Wolfcamp: Significant Performance Improvement 7.0 6.8 Oil Production (MBbls/d) 9.3 11.4 11.1 Averaged 2 JV rigs and 2 frac crews Results supported by: Latest generation wells beating 750 Mboe type curve Improved base production 1Q'16 2Q'16 3Q'16 4Q'16 1Q'17 Completions 5 5 13 21 11 Maintained production volumes despite: Half the number of completions (4Q 16 to 1Q 17) Initial JV wells on-line (50% WI) Lower NRI tied to sliding scale royalty agreement Well positioned for growth in 2H 17 Increasing completions each quarter throughout 2017 11
Wolfcamp: Improved Drilling Efficiencies Proven drilling performance 16 > 9,000 9,500 2017E capex per foot: $297 Best wells Spud to RR 4.1 days Most footage in 24 hrs. 7,483 Fastest drilling rate 284 ft./hr. Rig Days (Spud to Rig Release) 14 12 10 8 6 11.0 7,700 7,900 8.1 8,900 6.2 6.4 Average Lateral Length (Ft.) 9,000 8,500 8,000 7,500 7,000 How Real-time monitoring capability enables quick decisions at the wellsite 4 2014 2015 2016 2017E 6,500 Real-time geosteering means more lateral in target window Wellsite images enable deeper understanding of efficiency opportunities Performance measurement and tracking aids in understanding opportunities 12
Wolfcamp: Improved Frac Crew Efficiencies Improved efficiency Less time between stages 20.0 18.0 Frac Crew Performance 19.0 20.0 18.0 More stages per day More pumping hours per day 16.0 14.0 12.0 13.2 16.0 14.0 12.0 Key elements to improved efficiency Sand silos Hours 10.0 8.0 6.0 6.0 9.5 10.0 8.0 6.0 Stages/day Automatic fueling systems Frac pump reliability Real time monitoring 4.0 2.0 0.0 1.8 0.5 2.2 2.0 2016 2017 E Stage Pump Time Between Time 4.0 2.0 0.0 Pumping Hours/day STG/Day 13
Financial Results Kyle McCuen VP, Interim CFO and Treasurer 14
1Q 17 Financial Highlights $172MM Adjusted EBITDAX Adjusted cash operating costs down 3% from 1Q 16 Oil price realizations improved 10% from 1Q 16 Adjusted EPS of ($0.10) - in line with expectations Operating cash flow in line with capital spending Continued to improve financial position Note: See the First Quarter 2017 Financial and Operational Reporting Package, available at epenergy.com, for the Company s non-gaap reconciliations and definitions. 15
Increased Financial Flexibility Extended ~$940MM of 2019-2021 maturities to 2025 Refinanced higher interest secured and unsecured notes with 8% secured debt Successfully completed semi-annual borrowing base redetermination Reaffirmed RBL borrowing base of $1.44B Extended 1 st Lien debt to EBITDAX ratio covenant through 1Q 19, and lowered the ratio from 3.5x to 3.0x Increased liquidity to ~$1.2 billion at 3/31/17 16
Hedge Program Summary Hedge Summary 2017 2018 Oil volumes (MMBbls)¹ 7.7 8.9 Average floor price ($/Bbl) $ 60.52 $ 60.00 Natural Gas volumes (TBtu) 26.1 18.3 Average floor price ($/MMBtu) $ 3.28 $ 3.07 Added 2018 price support 2017: Oil: ~63%² estimated oil floored at $60.52 (retain additional upside) Natural Gas: ~76%² estimated natural gas floored at $3.28 2018: Oil: ~52%² estimated oil floored at $60.00 (retain additional upside) Natural Gas: ~44%² estimated natural gas floored at $3.07 Note: Hedge positions are as of May 2, 2017 (Contract months: April 2017 Forward). For further details on the Company s derivative program, see EP Energy Corporation s Form 10-Q for the quarter ended March 31, 2017 ¹ Includes 2017 WTI three way collars of 6.7 MMBbls and 2018 WTI three way collars of 8.9 MMBbls ² Percent hedged based on midpoint of 2017 guidance 17
Solid Execution Consistently meeting or beating expectations Low-cost efficient business, offsetting inflation Continued improvement in asset programs Increased financial flexibility Well positioned for continued success 18
Investor Update May 4, 2017
Appendix 20
Updated Type Well Economics Drilling locations with <$40/Bbl break-even prices Wolfcamp Eagle Ford Altamont Average lateral length 8,500 8,500 5,700 N/A Well spacing (acres) 150 150 40 60 80-160 Distance between wells (feet) 770 770 330 500 IP 30 (Boe/d) 722 639 1,068 408 IP 30 (Bo/d) 534 475 772 335 Gross EUR (MBoe) 750 550 505 500 % Liquids 80% 72% 78% 75% Gross well costs ($MM) $4.5 $4.4 $4.0 $4.2 Break-even pricing ($/Bbl) 1 $25.75 $38.00 $34.75 $35.00 Average WI % 100% 97% 85% 70% Average NRI 2 75% 73% 63% 59% Gross drilling locations 1,096 1,586 650 918 Assuming $55 (WTI) / $3.00 (HH) Pre-Tax IRR 57% 22% 58% 30% Pre-tax NPV ($MM) 4.9 1.5 $2.3 $2.0 Assuming $65 (WTI) / $3.50 (HH) Pre-Tax IRR 72% 29% 99% 44% Pre-tax NPV ($MM) 5.9 2.2 $3.6 $3.1 1 Break-even oil price (WTI) required to generate a 10 percent pre-tax IRR using latest well costs and $3.00 per MMBtu (HH). 2 Wolfcamp NRI does not include royalty relief according to sliding scale agreement; whereas economics do include royalty relief. 21
2017 Outlook Updated 2016 Outlook 2017 Oil production (MBbls/d) 45 49 Total production (MBoe/d) 75 82 Oil & gas capital ($MM) 1 Wolfcamp $245 325 Eagle Ford 260 270 Altamont 125 135 Total capital program ($MM) $630 $730 Oil production growth from 2H 16 Favorable cost performance below low end of guidance range Includes two Wolfcamp rigs FY 17 and a third rig mid-year Gross well completions Wolfcamp 2 90 105 Eagle Ford ~60 Altamont ~25 Total 175-190 Lease operating expense ($/Boe) $5.85 $6.35 Adjusted general and administration expenses ($/Boe) 3 $3.15 $3.40 Transportation and commodity purchases ($/Boe) $3.90 $4.50 Taxes, other than income ($/Boe) $2.70 $2.85 Multiple options available to fund Wolfcamp capital growth Expect to maintain Eagle Ford and Altamont production at 2H 16 levels Expect significant Wolfcamp oil volume growth DD&A ($/Boe) $16 $17 1 Includes 20 25 percent non-drill capital 2 Includes completions which are within the DrillCo joint venture with 40 percent of total well cost to EP Energy. 3 See the First Quarter 2017 Financial and Operational Reporting Package, available at epenergy.com, for the Company s non- GAAP reconciliations and definitions. 22
Current Financial Profile $2,000 Maturity Profile ($MM) As of 12/31/15 $4.9 billion Reduced total debt by ~$1billion since YE 2015 $1,500 $1,000 $2,000 Significantly extended maturities Retired or extended $2 billion of debt maturing before 2020 Multiple options to address 2020 maturity $500 $0 $2,000 $1,500 $497 $1,222 $350 Maturity Profile ($MM) As of 3/31/17 $3.9 billion $800 2017 2018 2019 2020 2021 2022 2023 2024 2025 ~$1.2 billion of liquidity at 3/31/17 $1,000 $500 $1,326 $1,000 $0 $551 $500 $21 $273 $250 2017 2018 2019 2020 2021 2022 2023 2024 2025 23