The Niobrara Region is emerging as a future growth play for U.S. oil production

Production, Mbbl/d Crude Oil Production Outlook CONTACT US John Best Managing Director jbest@criterionrsch.com James Bevan Editor jbevan@criterionrsch.com United States Crude Oil Production to Continue Growth in 2018 Criterion expects U.S. crude oil production to reach a fourth quarter 2018 average of 10.2 Mmbbl/d, rising 0.8 Mmbbl/d from fourth quarter 2017 volumes Permian Basin production will increase between December 2017 and December 2018 by 683 Mbbl/d (+25%) to a year-end average of 3,370 Mbbl/d The Eagle Ford will continue to be utilized as a cash flow engine to drive production growth in the Permian Basin and Oklahoma Resource Basins The Niobrara Region is emerging as a future growth play for U.S. oil production U.S. crude oil is on track to reach 9.7 Mmbbl/d by yearend 2017, equating to 0.9 Mmbbl/d (+9%) in growth between January and December 2017. As expected, a large portion of that growth came from the Permian Basin as companies continue to pour capital into the region. However, Criterion also noted that the Niobrara Basin emerged as the second largest growth region for U.S. crude production, adding 0.1 Mmbl/d and growing by 30% over the course of 2017. Heading into 2018, Criterion expects the Permian Basin to continue accelerating as it did in 2017 due to the activation of a large amount of midstream projects in the second half of 2018 and into 2019. Of the companies we are tracking with significant acreage in the Permian, nearly half intend to reach cash flow neutrality in 2018 and several others plan to fund budgets with cash on hand. One notable trend we are seeing is that companies who also have acreage in the Eagle Ford Shale are using that basin as a cash flow generation machine to fund development in the Permian and Oklahoma resource basins. With regards to the Niobrara, Criterion expects investment in the region to accelerate in 2018 as companies continue to delineate thier assets ahead of potential development programs in 2019 and beyond. Also, supermajor investment into shale formations is beginning to materialize with annual investments between 2018 and 2020 averaging $13.5 billion. Criterion anticipates that the momentum from 2017 will continue into 2018, equating to average U.S. production in 2018 of 10.0 Mmbl/d, equating to an 8% annual growth rate. Crude oil production will break the 10.0 Mmbbl/d mark in the second half of the year, with year-end 2018 volumes reaching 10.2 Mmbl/d. 1,000 800 600 400 846 2018 Crude Oil Production Growth by Basin December 2017 through December 2018 683 Source: Criterion Research 200 116 116 79 0 (200) (18) (130) TOTAL Permian Niobrara Bakken Anadarko Eagle Ford Other 1

Table of Contents 2018 U.S. Crude Oil Production Forecast... Pages 3-4 Permian Basin: Continued Growth in 2018... Pages 5-10 2018 Capital Spending & Cash Flows... Pages 5-6 Summary of Top Permian Basin Operators... Page 6 Scalable Development Programs in the Permian Basin... Page 7 Midstream Developments in the Permian... Pages 8-10 The Eagle Ford Shale: A Mixed View... Page 11 Niobrara & DJ Basin: An Emerging Growth Region... Pages 12-15 Companies Identifying the Region as an Emerging Growth Opportunity... Page 12 Current Development Programs in the Niobrara & DJ Basin... Pages 13-14 Table of Acreage Holders in the Niobrara & DJ Basin... Page 13 Major M&A Deals in the Niobrara & DJ Basin... Page 15 2018 Expectations in the Oklahoma SCOOP & STACK... Page 16 Materialization of Supermajor Spending on U.S. Shale Basins... Pages 17-18 Crude Oil Hedging Summary... Page 18 2017-2018 Capital Spending Outlook... Page 19 Appendix... Page 20 2

Production, Mbbl/d Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Crude Oil Production, MMbbl/d Crude Oil Production Outlook 2017-2018 U.S. Crude Oil Production In January 2017, U.S. crude oil production was averaging 8.8 Mmbbl/d after falling throughout 2016 as upstream companies cut back on spending amid the downturn in crude oil prices. With the subsequent recovery in the crude oil market, those companies began to ramp up capital spending programs for 2017, causing production to accelerate throughout the year. Currently, U.S. crude oil is on track to reach 9.7 Mmbbl/d in December 2017, equating 9% growth from January 2017 volumes U.S. Crude Oil Production v. Rig Count Source: Criteiron Research 10.0 9.8 9.6 9.4 9.2 9.0 8.8 8.6 9.0 CL Production 9.1 U.S. Rig Count 9.5 9.2 9.7 1,000 900 800 700 600 500 400 300 200 100 0 The Permian Basin was the primary engine behind resurgent U.S. crude oil supplies. Over the same period, the Permian is on track to add 0.54 Mmbbl/d, which translates to 25% growth over the 12-month period. Criterion has also noted increased volumes coming out of the Niobrara Basin, which grew 30% this year and contributed 0.12 Mmbbl/d, making it the second most prolific onshore oil basin. The Bakken formation also added to supply, growing by 0.11 Mmbbl/d. Meanwhile the Eagle Ford showed signs of growth early in 2017 but activity has fallen off in the second half of the year. The bulk of production growth has originated in the Permian Basin, which will add approximately 0.54 Mmbbl/d in 2017 600 500 400 300 200 100 2017 Crude Oil Production Growth by Basin January 2017 through December 2017 536 Source: Criterion Research 121 113 90 46 (Continued on page 4) - Permian Niobrara Bakken Anadarko Eagle Ford 3

Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18 Mar-18 May-18 Jul-18 Sep-18 Nov-18 Production in MMbbl/d Crude Oil Production Outlook Criterion anticipates that the momentum from 2017 will continue into 2018, equating to average U.S. production in 2018 of 10.0 Mmbl/d, equating to an 8% annual growth rate. Crude oil production will break the 10.0 Mmbbl/d mark in the second half of the year, with year-end 2018 volumes reaching 10.2 Mmbl/d. United States Crude Oil Production Forecast Base High Low 11.0 Criterion is expecting third quarter 2018 U.S. crude oil production to reach 10.5 10.0 9.5 9.0 9.1 9.1 9.6 10.1 10.4 10 Mmbbl/d 8.5 8.0 Source: Criterion Research Much like during 2017, the Permian Basin will account for the majority of this growth. Companies in the basin spent much of 2017 investing in infrastructure development in anticipation of future growth while securing contracts with oilfield service firms, sand providers and water handling companies to lower costs for scaled development programs. The capital flowing into the Permian Basin is being funded via cash flow growth in other regions, namely the Eagle Ford Shale. Several upstream companies are investing enough capital into the Eagle Ford to maintain current production levels with minimal costs so that they can utilize the region as cash flow engine. Meanwhile, the Niobrara & DJ Basin are showing signs of future growth potential in late-2018 and beyond. Large upstream companies currently hold significant acreage positions with decades of drilling inventories that are poised to bring online new volumes after growing by 30% in 2017. Companies in the basins are currently de-risking their assets by evaluating the geology to determine the potential of the formation for multi-layer development ahead of initiating full-field drilling programs. (Continued on page 5) Detailed U.S. Crude Oil Production Forecast (In Mbbl/d) 2017-2018 4Q17-4Q18 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Change Percent Change Percent Low Case 8,992 9,098 9,294 9,356 9,486 9,675 9,832 9,954 551 6.0% 597 6.4% Base Case 8,992 9,098 9,294 9,480 9,699 9,903 10,074 10,272 771 8.4% 792 8.4% High Case 8,992 9,098 9,294 9,584 9,845 10,051 10,245 10,467 910 9.8% 883 9.2% Sources: Criterion Research Data & EIA 4

Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18 Mar-18 May-18 Jul-18 Sep-18 Nov-18 Crude Oil Production, Mmbbl/d Permian Basin Rig Count Crude Oil Production Outlook Permian Basin Continued Growth in 2018 As mentioned before, the Permian Basin comprises the bulk of the new crude oil production which has come online over the last few years. Through 2017, the Permian has shown no indication of slowing down with the rig count rising to roughly 380 and production continuing to grow month-after-month. Between October and December 2017, the Permian Basin is on pace to increase by 180 Mbbl/d to end the year at a record 2,690 Mbbl/d. In 2018, production is set to grow at or beyond the current rate for several reasons. Permian focused producers spent much of 2017 preparing to further development through new infrastructure additions and the implementation of cost-cutting efforts for scalable drilling programs. As a result, Criterion believes Permian Basin production will increase between December 2017 and December 2018 by 680 Mbbl/d (+25%) to a year-end average of 3,370 Mbbl/d. Criterion believes Permian Basin production will increase by 680 Mbbl/d (+25%) between Dec-17 and Dec-18 3.5 3.3 3.1 2.9 2.7 2.5 2.3 2.1 1.9 1.7 1.5 Permian Basin Crude Oil Production v Rig Count Source: Criterion Research CL Production Rig Count 400 350 300 250 200 150 Capital Spending & Cash Flows With so much being invested into the Permian Basin, many have expressed concerns over the financial ability for upstream companies to maintain their current rate of development. Criterion dove into the financials of the top producers in the region to determine how they are funding capital programs heading into 2018. We identified 21 companies with a footprint in the region and cataloged their yearto-date 2017 operational cash flows versus capital spending programs and identified that only four of the twenty-one included are on track to spend within cash flows during 2017, EOG Resources, Diamondback Energy, Occidental Petroleum and Mid-Con Energy Partners. However, heading into 2018 that number is set to increase with ten total companies explicitly stating that they will achieve cash flow neutrality in 2018. The ten companies that are targeting cash flow neutrality in 2018 are currently forecast to grow their 2018 crude oil production by 245 Mbbl/d. That total accounts for 36% of growth in 2018 out of the Permian Basin. Notably, the ten companies who are on target to achieve cash flow neutrality in 2018 account for two-thirds of the capital spending among our entire sample set, resulting in a significant portion of capital being spent in the Permian Basin stemming directly from operational cash flows. (Continued on page 6) 5

Ten of twenty one Permian Basin focused companies are striving for cash flow neutrality in 2018, increasing from just four in 2017 Several Permian Basin operators are funding large capital programs with cash on hand when cash flows aren't adequate Permian Basin Focused Upstream Companies Source: Criterion Research Cash Flow Cash Flow Crude Oil 12-Month Nuetral in Nuetral in Production Net Company 2017 2018 2017 CapEx 2018 CapEx Dec-17 Dec-18 Change Occidental Petroleum Yes Yes $3,300 $3,750 207 235 28 Apache Corporation Yes $3,100 $3,720 97 135 39 EOG Resources, Inc. Yes Yes $3,175 $3,580 366 426 60 Pioneer Natural Resources $2,750 $2,905 172 192 20 Concho Resources, Inc. Yes $1,700 $1,900 128 164 37 Encana Corporation Yes $1,700 $1,785 81 84 3 Parsley Energy, Inc. $1,075 $1,450 57 72 15 Diamondback Energy, Inc. Yes Yes $875 $1,420 64 95 32 Energen Corp. $1,140 $1,300 54 76 22 Cimarex Energy Co. Yes $1,200 $1,250 61 77 15 WPX Energy, Inc. Yes $1,030 $1,150 66 94 28 RSP Permian, Inc. $663 $850 45 57 12 Laredo Petroleum, Inc. $630 $640 29 33 4 EP Energy Corporation $575 $570 47 57 10 Matador Resources Company $453 $430 23 28 5 Callon Petroleum Company Yes $404 $430 19 22 3 Resolute Energy Corporation $298 $392 16 24 7 Halcon Resources $300 $300 0 Approach Resources, Inc. $48 $49 3 3 0 Contango Oil & Gas Company $48 $41 1 1 (0) Mid-Con Energy Partners, LP Yes Yes $10 $8 3 3 0 Although the top companies in the Permian are aiming for cash flow neutrality, how are other producers planning to fund their development programs? Pioneer Natural Resources, who is investing a total of $2.35 billion into the Permian Basin during 2017, reported that they would support their capital program through a blend of operational cash flows and cash on hand, including liquid investments. Looking ahead, Pioneer intends to ramp up cash flow generation by 20% annually through 2020 when they are planning to achieve cash flow neutrality at $50/bbl oil prices. Parsley Energy, a pure-play Permian Basin operator, intends to spend between $1.35-$1.55 billion on capital expenditures in 2018, increasing from 2017 spending of $1.0 billion. However, they are not planning to be able to generate free cash flow from operations until the end of 2019 at the current development pace. In the interim, Parsley will fund capital programs with a mix of operating cash flow and cash on hand. As of September 30, 2017, Parsley had a liquidity of $1.9 billion, including an undrawn $1.0 billion credit facility and $0.9 billion in cash on hand. One additional note on Permian Basin cash flow is that several producers are utilizing their Eagle Ford shale assets to generate the cash flow needed to fund development costs in the Permian Basin. This will be detailed in a later section. (Continued on page 7) 6

Scaled Development Programs in the Permian Basin The scaled development approach to the Permian Basin was touched upon in the prior 2018 crude oil outlook with regards to Encana and Anadarko. Following that trend, several other producers are also initiating largescale development programs to propel them into 2018. In Concho Resources latest investor presentation, they detailed thier cumulative Northern Delaware Basin well completions between 2016 and 2017, highlighting which layers they have run development programs on. Over that period they have completed wells in seven different intervals on their Northern Delaware position with peak 30-day initial production (IP30) rates of every interval coming in above 1,060 boe/d. Looking ahead, Concho has already begun to identify the potential to split the Avalon Shale into three distinct zones for future development, allowing for even more advanced multi-zone completion programs. Meanwhile, in the Southern Delaware Basin, Concho stated that they might potentially add a third zone to their Wolfcamp B development program. As a result of this extensive development, Criterion believes Concho is on track to grow production in 2018 by another 25% as they bring online multi-zone well pads and continue to increase operational efficiencies. Concho s Northern Delaware Basin Completion Summary The Delaware Basin offers producers 5,000-ft of rock to develop, with increased efficiency and improved technology allowing it to be divided up even further than previously expected Source: Concho 3Q17 Investor Presentation According to Encana, the most significant expense with regards to drilling & completion costs is sand and water, which comprised 30-35% of total costs as of October 2017. To address this issue, they reported plans to begin self-sourcing frac sand and water to reduce costs while also locking in service rates for 2018. Similarly, Anadarko is securing local sand sourcing through the utilization of West Texas sand within its frac fleets and the development of 700 Mbbl/d in water disposal capacity. Diamondback Energy, a pure-play Permian company, has entered into deals to begin using local sand starting in early-2018. Diamondback stated that the move will reduce costs by an average of 5%. These strategies are being implemented across the entire region with operators such as EOG Resources, Pioneer and Apache implementing similar programs. For more details on those companies, visit the Criterion Research website. (Continued on page 8) 7

Permian Basin Midstream Development In response to production growth, midstream companies announced dozens of new projects to facilitate the flow of crude oil around the Permian Basin. Criterion is currently tracking 19 projects scheduled for completion between 2018 and 2019 that will enable crude to reach terminal facilities and outbound pipeline systems in West Texas. Of the projects being tracked, there have been 13 publicly announced gathering and transport systems that will carry crude oil from the wellhead to new and existing terminals. This set of projects will add at least 1,530 Mbbl/d in pipeline capacity (not all projects reported size) once fully operational, with 12 of them scheduled for service by year-end 2018. Notably, WPX has continued to secure commitments on new regional pipeline systems in the Permian Basin. In September 2017, WPX was selected as the firm shipper on the Oryx Pipeline System which will carry crude oil from every county in the Delaware Basin to a delivery point in Crane and Midland, Texas. WPX s commitment includes a 300,000- acre dedication to the 400 Mbbl/d pipeline system which will come online in late-2018. (Continued on page 9) Local Permian Basin Crude Oil Gathering & Processing Developments Source: Criterion Research Project Name Completion Date Project Status Capacity (Mbbl/d) Pipeline Developer Gathering & Transport Systems Blanco River Central Gathering Facility 3 3/31/2018 Under Construction 30 Blanco River DevCo San Andres Crude Gathering System Expansion 3/31/2018 Under Construction Stakeholder Midstream Wolf Permian Basin Crude Oil Gathering System 4/15/2018 Under Construction 55 Wolf Midstream, LLC Reeves-Odessa Origination (Rodeo) Pipeline 4/15/2018 Planned 130 Phillips 66 Santa Fe San Andres Crude OIl Gathering System 6/5/2018 Under Construction Santa Fe Midstream LLC Blanco River Central Gathering Facility 4 6/30/2018 Announced 30 Blanco River DevCo Blanco River Central Gathering Facility 1 Expansion 6/30/2018 Under Construction 20 Blanco River DevCo Conan Crude Oil Gathering Pipeline System 6/30/2018 Planned Western Refining Conan Gathering Stateline Crude Oil Gathering & Transport System 10/15/2018 Under Construction 125 Catalyst Midstream Partners, LLC Delaware Express Crude Oil Pipeline 12/31/2018 Announced 90 Medallion Delaware Express, LLC Oryx Delaware Basin Crude Oil Pipeline 12/31/2018 Under Construction 400 Oryx Midstream Services II, LLC DBMOS Crude Oil Gathering System 12/31/2018 Announced 400 Anadarko/DBM Oil Services Wink Pipeline 6/30/2019 Under Construction 250 Magellan Midstream Partners LP Total 1,315 Terminals & Handling Facilities Stateline Crude Oil Terminal 2/27/2018 Under Construction 50 Stateline Crude LLC Reeves-Odessa Origination (Rodeo) Odessa Terminal 4/15/2018 Planned Phillips 66 Wolf Colorado City Crude Terminal 4/15/2018 Under Construction 55 Wolf Midstream, LLC Reeves Oil Treating Facility 6/30/2018 Under Construction 60 Western Gas Partners, LP Conan Crude Oil Terminal 6/30/2018 Planned Western Refining Conan Gathering North Loving Oil Treating Facility 9/30/2018 Under Construction 60 Western Gas Partners, LP DBMOS Crude Oil Treating Facility - Phase 1 12/31/2018 Announced 120 Anadarko/DBM Oil Services Haley Oil Treating Facility 5/30/2019 Announced 60 Western Gas Partners, LP DBMOS Crude Oil Treating Facility - Phase 2 6/30/2019 Announced 50 Anadarko/DBM Oil Services Total 455 8

During the third quarter earnings cycle, Criterion added more than 2,170 Mbbl/d in new Permian Basin crude oil pipeline projects to our database The continued development of local infrastructure is vital so that crude oil can flow from the wellhead to terminals to connect with the extensive takeaway capacity currently being developed between the Permian Basin and markets along the Gulf Coast and into Cushing. In Criterion's prior crude oil outlook, we were tracking 1,400 Mbbl/d in crude oil pipeline projects which would bring supply out of the Permian Basin and to markets along the Gulf Coast and in Oklahoma. Since that update, six new projects have been announced, pushing the total takeaway capacity being tracked to 3,615 Mbbl/d. This massive boost in capacity is largely scheduled for completion in 2019, which would line up with the completion of additional gathering infrastructure and terminals in the second half of 2018. Details on the newly announced projects are as follows: BridgeTex Pipeline Expansion Phase 2 In early December, Magellan Midstream and Plains All American announced that their 50/50 owned BridgeTex Pipeline Company commenced a supplemental open season to secure commitments on the second expansion of their crude oil pipeline system. This new expansion will take the BridgeTex system's volumes from 400 Mbbl/d to 440 Mbbl/d in early 2019. The open season will end on December 30, 2017. BridgeTex, as it sits today, carries supply from Colorado City, Texas to Houston, Texas. Gray Oak Pipeline On December 11, 2017, Phillips 66 and Enbridge launched an open season on the newly proposed Gray Oak Pipeline which will have an initial capacity of 385 Mbbl/d between West Texas and markets in (Continued on page 10) Permian Basin Takeaway Crude Oil Pipelines Source: Criterion Research Project Name Completion Date Project Status Volumes (Mbbl/d) Downstream Market Pipeline Developer Midland to Sealy Pipeline Phase 1 12/30/2017 Under Construction 405 Houston Enterprise Products Partners Permian Express 3 Pipeline - Phase 1 12/31/2017 Announced 100 Port Arthur/Nederland Permian Express Partners LLC Midland to Sealy Pipeline Phase 2 2/15/2018 Under Construction 45 Houston Enterprise Products Partners EPIC Crude Pipeline 3/15/2019 Under Construction 550 Corpus Christi TexStar Midstream Logistics LP BridgeTex Pipeline Expansion Phase 2 3/31/2019 Announced 40 Houston BridgeTex Pipeline Company, LLC South Texas Gateway Crude Oil Pipeline 6/15/2019 Announced 400 Corpus Christi Buckeye Partners, L.P. Delaware Basin to Cushing Pipeline System Expansion 6/30/2019 Under Construction 120 Cushing Plains All American Pipeline Corpus Christi, Freeport Gray Oak Pipeline 9/30/2019 Announced 385 & Houston Phillips 66 Enbridge Inc. Permian Basin to Corpus Christi/Ingleside Pipeline 9/30/2019 Announced 570 Corpus Christi Plains All American Pipeline Jupiter Pipeline 12/31/2019 Announced Corpus Chrisit & Brownsville JupiterMLP LLC Magellan Permian & Eagle Ford to Gulf Coast Pipeline 12/31/2019 Announced 350 Three Rivers, Corpus Christi & Houston Magellan Midstream Partners LP Enterprise Permian to Gulf Coast Crude Oil Pipeline 3/31/2020 Announced 650 Houston Enterprise Products Partners Total: 3,615 9

Corpus Christi, Freeport and Houston, Texas. The project can expand beyond the initial capacity, depending on shipper interest and service is planned for the second quarter of 2019. Shippers will be able to select from origin stations in Reeves, Loving, Winkler and Crane Counties in West Texas. Jupiter Pipeline Several new projects have been announced to bring Permian Basin crude oil to multiple markets via one pipeline route The Jupiter Pipeline is a development proposed by JupiterMLP, LLC, a private firm with operations in Texas that focuses on bringing supply from its terminals in the Permian to markets along the Gulf Coast. To further this goal, they are developing the 670-mile Jupiter Pipeline to carry an unstated quantity of crude oil from origin points in Orla, Texas to offtake points in Pecos, Three Rivers, Corpus Christi and then Brownsville. Additionally, JupiterMLP is developing a crude oil upgrading, processing and export terminal in Brownsville that will have 10 million barrels of storage, deep water dock access and the ability to process and upgrade high gravity crude oil. The projects currently have completion dates in late-2019. Magellan s Pipeline Development On December 1, 2017, Magellan Midstream launched an open season to seek customer interest in a proposed pipeline that would carry 350 Mbbl/d in crude oil from points in the Permian and Eagle Ford Basins to destinations in Corpus Christi and Houston. The open season will close on February 1, 2018. If approved, the pipeline could be online by year-end 2019. Magellan s proposed pipeline would include a 375-mile segment from Crane to Three Rivers, Texas where it would then flow 200-miles from Three Rivers to the Houston area as well as a 70-mile segment to bring supply to Corpus Christi. Initial capacity is to be at least 350 Mbbl/d with the ability to expand to 600 Mbbl/d if needed. Additional segments are being considered for Midland and Orla, Texas in the Permian and Gardendale and Helena, Texas in the Eagle Ford. Enterprise Permian to Gulf Coast Pipeline Conversion In conjunction with Enterprise s development of the new Shin Oak NGL Pipeline in the Permian Basin, they announced plans to convert an old NGL pipeline into a crude system to enable more supply to come out of the basin and reach the Gulf Coast. The conversion will be completed in the first half of 2020 and will provide more than 650 Mbbl/d in transport capacity. Enterprise is currently operating three NGL pipelines which flow from the Permian Basin to the Gulf Coast: Seminole Blue, Seminole Red and Chaparral. They did not state which would be converted. Plains All American Permian to Corpus Christi Pipeline Plains All American reported that it has received sufficient interest to launch an open season on crude oil pipeline to carry supply from the Permian Basin to the Corpus Christi area. The project will include origin points in Orla, Wink South, Midland, Crane and McCamey, TX. The system could carry up to 570 Mbbl/d in capacity. Plains stated that the pipeline will include a combination of existing pipelines with two new pipelines, the first of which will run from Wink South to McCamey, TX and the second from McCamey to Corpus Christi. If approved, the project would be online in the third quarter of 2019. (Continued on page 11) 10

The Eagle Ford Shale A Mixed View While many companies classify the Permian Basin as a critical piece of their portfolio, views on the Eagle Ford Shale appear to be mixed. Criterion compiled data on the top ten Eagle Ford crude oil producers to determine what the regions biggest players are thinking heading into 2018. Several companies are utilizing the Eagle Ford as a cash flow engine to fund development of other regions in 2018 Criterion does not expect the Eagle Ford region to add any significant volumes during 2018. For companies with a position in the Permian Basin or STACK play, the Eagle Ford is serving as a source of free cash flow generation to fund growth across more profitable regions. For example, Devon stated that the Eagle Ford is contributing 30% of its $2.2 billion in cash flow generation for 2017 while it only accounts for 9% of the capital spending budget. Similarly, Marathon Oil classified the Eagle Ford as a cash flow generator to fund development across other parts of their portfolio. Marathon dedicated 30% of their 2017 spending to maintain current production levels in the Eagle Ford, and they have been focused on improving production per well to lower that capital requirement. Encana, with core operations in the Permian Basin and Canada, is also using the Eagle Ford to generate free cash flows. Meanwhile, several other companies are still targeting steady production growth from their Eagle Ford shale assets. Chesapeake spent the first three quarters of 2017 bringing 20-30 wells online each quarter in the Eagle Ford as they focused on achieving cash flow neutrality in 2018. For the fourth quarter of 2017, Chesapeake expects to bring online 73 Eagle Ford wells. In Chesapeake's latest investor presentation, they stated that the Eagle Ford shale was an oil production growth engine with break-evens of less than $40/bbl across their position in the basin. Carrizo has also exhibited steady growth in the Eagle Ford shale over the course of 2017, with third quarter volumes at 30 Mbbl/d. However, Carrizo entered into the Delaware Basin in the third quarter of 2017 with a $648 million acquisition, and they are currently redefining their company portfolio with a near-term goal of cash flow neutrality at year-end 2018. Notably, Carrizo entered into a deal in December 2017 to divest 24% of its Eagle Ford acreage for $245 million in cash. Meanwhile, Murphy Oil continues to develop new wells in the region with plans to boost production through year-end 2017. Similar to Carrizo, Murphy recently entered into the Permian Basin with a 31,000-acre acquisition which they have only recently begun to test. ConocoPhillips, with 210,000-acres in the Eagle Ford Shale, announced that it would be a critical piece of their investment program between 2017 and 2020 alongside the Delaware Basin. Conoco intends to invest $1.2 billion annually on short-cycle unconventional assets with a planned compound annual growth rate in the Eagle Ford of 25% over that period. Top Upstream Companies in the Eagle Ford Shale Source: Criterion Research Net Eagle Ford Crude Oil Production Company Acreage 3Q17 (Mbbl/d) EOG Resources 528,000 220* Chesapeake 270,000 52 ConocoPhillips 210,000 130* Murphy 151,000 45 Marathon Oil 145,000 58 EP Energy 104,122 20 Carrizo 78,500 30 EXCO 49,300 3 Devon 45,400 30 Encana 42,000 33 Total 1,623,322 620 *Total production, including NGL & NG With the mixed mentality of companies with a position in the Eagle Ford Shale Criterion does not expect the region to add significant volumes during 2018. (Continued on page 12) 11

Gas Production (Mmcf/d) Crude Oil Production Outlook Niobrara & DJ Basin An Emerging Growth Region The Niobrara & DJ Basin has begun to be classified by several top-tier U.S. producers as an emerging growth play, namely by Anadarko in their recent investor presentation. Before diving into the growth potential of the region, it's important to outline exactly what Criterion includes in its regional analysis of the Denver- Julesburg (DJ) Basin/Niobrara area. Horizontal Layers of the Wattenberg Field For analysis purposes, this will include all basins in Colorado and Wyoming that have been highlighted by E&P firms; including the DJ Basin, Wattenberg Field, Niobrara, Park Basin and the Powder River Basin. Much like the Permian Basin, this area has multi-zone development potential with drilling inventories broken up across many horizontal layers. The Petroleum Technology Transfer Council outlined an example of this breakdown in an old presentation on the Wattenberg Field which is within the DJ Basin. The Wattenberg includes multiple stacked Niobrara Layers (A, B and C) along with many other geological layers. Different sections of the Niobrara and DJ Basin include geologies not listed in the graphic, such as the DJ Basin Codell. In January 2017, crude oil production in the Niobrara was averaging 402 Mbbl/d. Since then, it has risen to a December 2017 average of 523 Mbbl/d, equating to 30% growth and marking it as the second highest growth region in the U.S. with regards to crude oil production. Looking into 2018, Criterion expects the region to grow by approximately the same volume as producers continue to delineate acreage across the basin in anticipation of future development. (Continued on page 13) Source: Petroleum Technology Transfer Council Niobrara Production in 2017 Source: Criterion Research, EIA The Niobrara has grown 30% in 2017, adding the second most crude volumes among U.S. shale basins 650 600 550 500 450 400 350 300 402 523 12

Companies Identifying the Niobrara & DJ Basin as an Emerging Growth Opportunity After analyzing the investor presentations of ten companies with a position in the Niobrara and DJ Basin, Criterion has begun to note that the region has rising growth potential through 2018 and beyond. U.S. Producers with significant positions in the Powder River Basin are delineating thier assets with an eye on future growth potential EOG, which holds 400,000 acres in the Powder River Basin and 81,000 net acres in the DJ Basin released some notable developments during the third quarter of 2017. On EOG s DJ Basin asset, they drilled seven gross (2 net) wells in the DJ Basin Codell Formation which exhibited IP30 rates of 790 boe/d, of which crude oil volumes totaled 665 bbl/d through a 9,400-ft lateral. Notably, EOG s VP of Exploration and Production identified the DJ Basin Codell as a premium play moving forward. Additionally, EOG is continuing to delineate its Powder River Basin with 35-planned completions in 2017 to test a 4,800-ft stacked play, in which the Powder River Basin Turner Sand has already been identified as a premium layer. EOG s statements on the region show that operators are beginning to look towards the Rockies as a potential growth play moving ahead. Similarly, Devon has identified more than ten different prospective intervals on their 400,000 net acre position in the Powder River Basin, and they classified the region as an emerging growth opportunity in their recent investor presentation. During 2017, Devon s Powder River Basin capital program was dedicated to de-risking this stacked-pay asset to position the company to accelerate drilling programs in future years. Year-to-date in 2017, Devon has brought online nine wells with IP30 s averaging more than 1,800 boe/d (95% oil). Those wells have targeted the Parkman and Teapot layers of the Powder River Basin. Current Development Programs in the Niobrara & DJ Basin Of the ten companies Criterion is tracking with a foothold in the region, four are currently running notable development programs: Anadarko, Whiting Petroleum, SRC Energy and Noble. These four companies hold over 880,000 acres and are producing 156 Mbbl/d in crude oil as of the third quarter of 2017. E&P Companies in the Niobrara & DJ Basin Source: Criterion Research Company Acreage Drilling Locations Region (Continued on page 14) 3Q17 Crude Oil Production (Mbbl/d) Anadarko 400,000 Not Stated DJ Basin 83 EOG Resources 400,000 Delineating Powder River Basin Not Stated Devon 400,000 Delineating Powder River Basin 13 Noble 321,800 2,620 DJ Basin 61 Whiting Petroleum 131,763 5,448 Niobrara 12 Sandridge 123,000 1,200 Niobrara (North Park B 16 SRC Energy 90,000 1,700 DJ Basin 27 Fifth Creek Energy 81,000 1,179 DJ Basin 2 EOG Resources 81,000 Delineating DJ Basin Not Stated Bill Barrett 70,100 1,686 DJ Basin 13 Bonanza Creek 67,000 970 DJ Basin 6 Total 2,165,663 14,803 233 13

Overview of the Niobrara & DJ Basin Several Companies, including Anadarko and Noble Energy, are already running development programs in the Niobrara Region Source: EIA Anadarko, the leading producer in the region, boosted their crude oil volumes in the third quarter of 2017 10% sequentially to 83 Mbbl/d. This occurred as their new well s begun to produce oil volumes which are 40% above published type curves. By year-end 2017, Anadarko expects its DJ Basin crude oil production to surpass 100 Mbbl/d. This bump was achieved thanks to 107 well spuds and 79 well completions in the third quarter of 2017, marking a 70% increase in well completions over the second quarter of 2017. Looking into 2018, Anadarko will be dedicating $950 million of their $2,100 million US Onshore budget to the DJ Basin. Comparatively, they are investing $900 million into the Delaware Basin for 2018. This investment will be used to grow DJ Basin crude oil volumes by 30% through the utilization of five drilling rigs and three completion crews. Noble Energy has spent 2017 driving up their crude oil production in the DJ Basin through the development of locations across their 352,000-acre position. In the third quarter of 2017, crude oil accounted for 54% of Noble s DJ Basin production, rising from 49% in the third quarter of 2016. They are currently running a development program on their Wells Ranch and East Pont acreage blocks in Weld County, Colorado which boosted crude production to 61 Mbbl/d in the third quarter thanks to a 10% sequential increase in volumes out of those regions. In November 2017, Noble entered into a deal with SRC Energy to divest 30,200 net acres of non-core DJ Basin acreage for $608 million. This asset sale was a strategic move by Noble to accelerate the value of the divested land due them not planning to develop it for several years. Noble stated that they would remain focused on their acreage in the Northern and Eastern portions of the basin which hold oilier drilling opportunities. With the acquisition of 30,200-acres from Noble, SRC Energy effectively increased their DJ Basin holdings by 50% to 90,000-acres while boosting their drilling inventory by 55% to 1,700 gross locations. In the press release announcing the deal, SRC Energy stated that the new acreage was adjacent and south of current holdings, allowing them to immediately begin planning, permitting and construction (Continued on page 15) 14

infrastructure to develop the land. However, SRC Energy stated that they intend to take a measured approach before deploying additional capital. Excluding the new acquisition, SRC is on track to increase production from a 2016 average of 12.2 Mboe/d to an estimated 2017 average between 33 and 35 Mboe/d. Whiting Petroleum holds a 131,763-acre position in the Niobrara region which they refer to as the Redtail Field Area. On this asset, they hold 5,448 potential drilling locations targeting the Niobrara A, B, C, and Codell/Fort Hays shale layers. During the third quarter of 2017, Whiting boosted Redtail net production to 11.8 Mboe/d, a sequential increase of 78%. This boost came as Whiting placed online 48 wells in the third quarter, with plans to exit 2017 with 39 drilled-but-uncompleted wells in the region. Major M&A Deals in the Niobrara & DJ Basin In the last two months, two significant mergers were announced in the Niobrara and DJ Basin. In November, SandRidge entered into a deal to acquire Bonanza Creek for $746 million through a blend of cash and stock. SandRidge stated in a recent letter to shareholders that their current assets, not including Bonanza's, are high risk and that their Mississippi Lime field is in decline with no meaningful opportunities for growth. Additionally, SandRidge stated that their positions in the Niobrara and are in the early phases of delineation and development with large amounts of capital needed to shift to full production. Thus, they decided to acquire Bonanza Creek to improve their risk profile by adding assets which allow for immediate returns while they progress their existing holdings out of the delineation phase and into the development phase. Several M&A deals have taken place in the Niobrara & DJ Basin, consolidating the positions of major players in the region In December 2017, Bill Barrett announced that they would be combining with Fifth Creek Energy in a deal valued at $649 million. Fifth Creek is a portfolio company of NGP, and they will receive 100 million shares of the new company while Bill Barrett will exchange their stock on a 1-for-1 basis. The deal is scheduled to close in the second quarter of 2018. The combined entity will hold 151,000 net acres and a drilling inventory of 2,865 well which are suitable for extended reach lateral development. Third quarter 2017 production of the two companies was 24 Mboe/d, and they hold 168 million barrels of proved reserves. The combined company will run three drilling rigs in 2018, with production estimated to total 33 Mboe/d and capital spending of $550 million. Source: Bill Barrett These two mergers, along with SRC Energy's acquisition from Noble, bring additional capital into the Niobrara Region while enabling producers to develop more extensive holdings at a lower cost. The cost of development is expected to drop primarily due to synergies achieved with contiguous acreage blocks that allow for longer laterals and integrated infrastructure development across the portfolio. (Continued on page 16) 15

Crude oil production growth in the Anadarko basin only accounted for 11% of growth across the entire United States during 2017, Criterion expects to region to grow marginally in 2018 2018 Expectations in the Oklahoma SCOOP & STACK Crude oil production growth in the Anadarko basin during 2017 only accounts for 11% of growth across the entire United States, with volumes between January and December 2017 rising 90 Mbbl/d (+23%) to a December average of 523 Mbbl/d. Heading into 2018, Criterion believes that the SCOOP/STACK will continue growing, but it will still only add marginal volumes in the grand scheme of U.S. crude oil supply growth. Much like the Niobrara, producers in the oil-rich sections of the SCOOP & STACK are still delineating their assets ahead of full field development. Continental Resources, for example, stated that they are still undergoing density testing on their oil-rich STACK acreage which targets the Meramec Shale. However, recent results are promising with Continental s 10-well Compton Unit in the Meramec producing at a per well rate of 2,200 boe/d (75% oil) in its initial 24-hours of production. Continental stated that its STACK wells are currently economic at $50 WTI with a well cost of $9 million and a 146% rate-of-return. Continental s SCOOP Springer wells are also performing above expectations, with further density testing now taking place. On Continental's SCOOP Springer asset, they intend to increase activity in 2018 following completion results from four wells during 2017 that showed IP24 s between 1,257 and 2,300 boe/d (79-89% oil). Similarly, Marathon Oil is continuing to grow its STACK Meramec production with volumes jumping 18% in the third quarter of 2017 to 58 Mboe/d. The growth came despite Marathon spending much of the third quarter focusing on capturing leasehold and delineating their position ahead of future growth. Marathon is also testing its Osage layer in Kingfisher County, Oklahoma with initial well results showing IP30 s of 850 boe/d (55% oil) through 4,700-ft laterals. While many companies like Marathon and Continental are still undergoing delineation work, Devon Energy has begun its full-field development program in the STACK Meramec formation. Through 2017, Devon is on track to increase its STACK production by 35% to an exit rate over 120 Mboe/d. Devon is accelerating this work with the spud of its 24-well, multi-zone Showboat Project which is its first such development. Showboat will target four landing-zones in the Meramec and Woodford and is scheduled for initial production volumes to come online in the second quarter of 2018. Devon will also be kicking off several other Meramec development projects similar to Showboat in 2018, with drilling already beginning on the seven-well Coyote Project. (Continued on page 17) Source: Devon Energy 16

Materialization of Supermajor Spending on U.S. Shale Basins Early in 2017 Criterion highlighted that Supermajors planned to shift capital away from large, capitalintensive projects and into short-cycle development programs. In 2018, this reality is starting to materialize with ExxonMobil, Shell, Chevron and ConocoPhillips all announce aggressive growth plans across U.S. onshore basins. Cumulatively, the four companies plan to invest $13.5 billion annually into short-cycle projects with plans to ramp up production from a 2017 average of 870 Mbbl/d to a 2020 average of 1,800 Mboe/d. Super-Major Operational Outlook for North American Shale Development Source: Criterion Research ExxonMobil Annual Capital Spending on Short-Cycle Regional Focus of Total Production in Compound Annual Growth Total Production in Company Developments ($B) Spending 2017 (Mboe/d) Rate (2018-2020) 2020 (Mboe/d) ExxonMobil $5.5 Bakken & Permian Basin 200 20% 500 Royal Dutch Shell $2.5 Permian Basin & Canada 250 21% 450 Chevron $4.3 Permian Basin 200 31% 450 ConocoPhillips $1.2 Eagle Ford & Permian Basin 220 22% 400 Total $13.5 870 1,800 Supermajors plan to grow shale production by 930 Mbbl/d between 2017 and 2020, with a focus on the Permian Basin ExxonMobil, with positions in the Bakken & Permian Basin, reported plans to dedicate a significant portion of their U.S. onshore capital budget to developing the Permian Basin. By year-end 2018, Exxon plans to increase their rig counts in the Permian to 30 drilling rigs, rising from the 20 currently deployed. This program is designed to ramp up Exxon s U.S. unconventional production from current levels of 200 Mboe/d to a 2025 level nearing 750 Mboe/d. Royal Dutch Shell At Shell s annual management day, they detailed plans to annually invest between $2 billion and $3 billion through 2020 into shale development programs. Utilizing this program, Shell intends to drive their shale production up by 200 Mboe/d through 2020 with a focus on developments in the Permian Basin and Fox Creek Duvernay. Shell s Permian production has already risen 75% in 2017 to 80 Mboe/d. Shell intends to achieve their production growth goals at an average break-even price of $40/bbl, and Shell is forecasting organic free cash flows of $1-2 billion by 2019-2020. Chevron Chevron outlined plans during the third quarter of 2017 to grow Permian Basin production from its current 200 Mboe/d level to more than 450 Mboe/d by year-end 2020. To accomplish this, they are currently running a 15 rig program and will be dedicating $3.3 billion to the Permian Basin during 2018, representing half of their U.S. upstream budget. (Continued on page 18) 17

Jan-10 Apr-10 Jul-10 Oct-10 Jan-11 Apr-11 Jul-11 Oct-11 Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 Oct-13 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 NYMEX WTI Crude Oil Continuation, in $/Bbl Commercial Short Open Interest, in contracts Crude Oil Production Outlook ConocoPhillips ConocoPhillips stated that between 2018 and 2020 intend to achieve a 20% compound annual growth rate (CAGR) on their unconventional assets (Eagle Ford, Delaware and Bakken) with the deployment of 6 additional rigs. This would bring production from 2017 levels of 220 Mboe/d to a 2020 average of more than 400 Mboe/d. While Bakken production will stay flat at 70 Mboe/d during that period, COP is projecting a CAGR of 25% in the Eagle Ford and 60% in the Delaware Basin. Crude Oil Hedging Positions Recent Activity With the recent run-up in prices, producers have increased their hedging positions as well. As of December 5, 2017, WTI short commercial positions set a new record high of 1.41 Billion barrels, an increase of 126 million barrels from last quarter. Criterion noted a significant amount of hedging took place as prices neared $50. As prices have neared $60, producers have further accelerated their hedging activity. This aggressive hedging continues to follow Criterion's mindset that producers are protecting additional production on every rally. $120.00 NYMEX WTI Commercial Short Position (Futures Only) Source: Criterion Research, CTFC NYMEX WTI Commercial Short Open Interest NYMEX WTI Continuation 1,500,000 $100.00 $80.00 1,400,000 1,300,000 1,200,000 $60.00 $40.00 1,100,000 1,000,000 900,000 $20.00 800,000 700,000 $- 600,000 Hedging Positions Heading into 2018 As of September 2017, Criterion is tracking crude oil hedges for 46 upstream companies, with cumulative hedges in place veering 1,638 Mbbl/d for the fourth quarter of 2017 and 1,292 Mbbl/d for 2018. When compared to company production forecasts, our sample set has hedges in place on 57% of fourth quarter production and 38% of 2018 production (details of these hedges can be seen in the appendix). Criterion will continue to update and this data set moving forward. (Continued on page 19) 18

Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Capital Spending, $B Crude Oil Production Outlook 2018 Upstream Capital Spending Forecast As of November 2017, Criterion is tracking capital spending for 59 U.S. focused upstream companies. Among that sample set, we are forecasting 2018 capital spending of $68.3 billion, rising 10% from 2017 spending of $62 billion. While this isn t an overly significant boost in spending, producers across the U.S. have continued to reduce well costs and improve operational efficiencies through scaled development programs. This led to a multitude of capital spending cuts during the second half of 2017 while producers maintained or even ramped up their drilling & completion programs. Notably, capital spending rose by $2.7 billion in the third quarter of 2017, increasing synonymously with the extensive completion programs which were executed in the second half of 2017. The higher spending led to a second-half bump in production as well, most evident in daily production for late- November and early-december. Looking into 2018, Criterion expects companies focused on natural gas regions such as the Marcellus & Utica Shale to continue at their current pace of development, with moderate boosts in capital spending versus 2018. Conversely, companies in the Permian Basin and SCOOP & STACK of Oklahoma will continue to increase the size of their scaled development programs throughout the year, leading to rising quarterly spending each quarter and headed into 2019. U.S. Capital Spending by Quarter Data Covering 59 Companies with U.S. Operations, Excluding Supermajors $30.0 $25.0 $20.0 $15.0 $10.0 $5.0 $10.8 $13.2 Capital Spending U.S. Natural Gas Production $15.8 $17.1 $16.1 $16.5 $16.9 $17.2 $17.8 80 75 70 65 60 55 $- 50 Source: Criterion Research 19

Appendix 4Q17-2018 Company Specific Hedging... Page 21-22 2018 Production Forecast by Company... Page 23-25 20

2017-2018 Crude Oil Hedging Analysis Fourth Quarter of 2017 2018 Company Name Hedges Production % Hedged Hedges Production % Hedged Amplify Energy Corporation 5 10 46% 5 10 51% Anadarko Petroleum Corporation 91 281 32% - 314 0% Antero Resources Corporation 3 5 56% - 8 0% Apache Corporation 92 97 95% 56 126 44% Approach Resources, Inc. 3 3 82% 1 3 42% Baytex Energy Corp. 18 44 41% 10 49 19% Bill Barrett Corp. 8 14 58% 7 14 49% Cabot Oil & Gas Corporation 5 14 36% - 16 0% Callon Petroleum Company 10 19 55% 15 21 69% Chesapeake Energy Corporation 61 92 66% 52 96 54% Cimarex Energy Co. 5 61 8% 10 70 14% Concho Resources, Inc. 111 128 87% 87 149 58% Crescent Point Energy 50 140 36% 10 150 7% Denbury Resources Inc. 28 60 47% 31 61 50% Devon Energy Corporation 162 260 62% 81 285 29% Diamondback Energy, Inc. 41 64 65% 33 82 40% Eclipse Resources Corporation 2 5 42% 4 5 86% Encana Corporation 88 81 108% 88 84 105% Energen Corp. 35 54 64% 37 69 54% EOG Resources, Inc. 0 366 0% - 412 0% EP Energy Corporation 27 47 58% 24 53 46% EV Energy Partners LP 1 4 18% - 4 0% Gulfport Energy Corp. 6 9 70% 5 9 48% Hess Corporation 80 106 75% 0 117 0% Laredo Petroleum, Inc. 19 29 65% 26 31 83% Marathon Oil Corporation 105 148 71% 69 162 42% Matador Resources Company 11 23 49% 10 27 36% Mid-Con Energy Partners, LP 3 3 93% 2 3 67% National Fuel Gas Company 0 8 0% 5 8 58% Newfield Exploration Co. 53 66 81% 44 72 61% Northern Oil and Gas, Inc. 8 13 60% 8 14 60% Oasis Petroleum Inc. 21 55 38% 39 62 63% Parsley Energy, Inc. 50 57 88% 70 67 104% PDC Energy, Inc. 27 40 67% 26 44 59% Pioneer Natural Resources Co. 161 172 94% 156 185 84% QEP Resources, Inc. 4 58 6% 43 71 61% Range Resources Corporation 10 15 62% 7 16 41% Resolute Energy Corporation 6 16 33% 7 20 36% RSP Permian, Inc. 35 45 77% 26 52 50% 21