Diamondback Energy, Inc. · NASDAQ:FANG
Diamondback Energy — Merger or Acquisition (February 2024)
20 slides from Diamondback Energy's merger presentation, Feb 12, 2024
Slide 1: Creating the Must-Own Permian Pure Play
1 Creating the Must-Own Permian Pure Play February 12, 2024
Slide 2: Cautionary Statement: Forward-Looking Statements
Cautionary Statement Forward-Looking Statements This communication contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, which involve risks, uncertainties, and assumptions. All stat
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures 2 Non-GAAP Financial Measures This presentation includes financial information not prepared in conformity with generally accepted accounting principles (GAAP), including EBIDTA, free cash flow and PV-10. The non-GAAP information should be considered by the reader in addit
Slide 4: Creating the Must-Own Permian Pure Play
Creating the Must-Own Permian Pure Play Financial Strength 2 Driving Results Through Lowest Cost Operations World Class Assets in a World Class Basin Leading Permian Position
Slide 5: Purchase Price of $26bn
5 The Must-Own Permian Pure Play Purchase Price of $26bn $8 billion cash (subject to adjustment) and 117.3 million of Diamondback shares to be issued to Endeavor equity holders at closing Cash expected to be funded through a combination of cash on hand, borrowings under the Company’s credit facility
Slide 6: About Endeavor: A Leader in the Midland Basin
The Must-Own Permian Pure Play Expected 2024 oil production of 190–200 MBO/d (350–365 MBOE/d) Total 2024 capital budget of approximately $2.5-$2.6 billion Midland Basin Core 6 Glasscock Martin Howard Midland Reagan Upton Established in 1979 HQ: Midland, TX ~1,200 Employees Core Values:
Slide 7: Premier Permian Acreage Footprint
The Must-Own Permian Pure Play ~3,800 ~6,100 Combination creates peer leading inventory quality and duration Premier Permian Acreage Footprint Permian Leader Financial Strength World Class Resource Low Cost Operations Best in Class Core Inventory Quality and Depth (<$40 WTI Break Evens) + Diamondbac
Slide 8: Combination of Premier Assets and Operations
Source: Enverus as of 2/9/2024. 8 Note: Peer group includes CIVI, COP, OVV, OXY, PR, PXD, VTLE and XOM. All Midland Basin wells POP since January 2022. The Must-Own Permian Pure Play ~170 ~170 167 161 157 147 138 131 117 108 Combination of Premier Assets and Operations Combined size and scale create
Slide 9: Expected to Deliver Best in Class Execution
The Must-Own Permian Pure Play Diamondback has built a scalable, low cost operating model ready to deliver on the pro forma asset 24 20 16 12 8 4 0 0 2 4 6 8 10 12 14 16 18 20 22 24 26 Depth (1,000's of Ft.) Avg. Days 2019 2020 2021 2022 2023 ~40% Reduction from 2019 - 2023 Midland Basin Avg. Drilli
Slide 10: Leading Cost Structure Creates Meaningful Synergies
The Must-Own Permian Pure Play Leading Cost Structure Creates Meaningful Synergies Midland Basin DC&E Costs Source: Company data and filings. Combined portfolio developed by the low cost Permian operator offers meaningful pro forma capital cost reductions in 2025 World Class Resource Low Cost Operat
Slide 11: Industry Leading Cash Margins Enhance Cash Flow
Source: Company data, filings and estimates. 11 Note: Peer group includes CTRA, DVN, EOG, OVV, PR and PXD. Unhedged cash margin calculated as the sum of unhedged realized price per BOE less cash operating costs divided by the unhedged realized price per BOE. Cash operating costs calculated as the su
Slide 12: Industrial Logic Drives Significant, Tangible Synergies
12 The Must-Own Permian Pure Play Industrial Logic Drives Significant, Tangible Synergies Financial Strength Meaningful annual synergy potential of ~$550mm representing upwards of $3bn(1) of total value over the next decade Permian Leader Low Cost Operations Capital and Operating Costs Operation
Slide 13: Emergence of a World Class Independent
13 The Must-Own Permian Pure Play 1300 867 816 751 722 700 463 440 353 300 243 236 194 2200 960 910 850 838 695 494 426 400 400 344 307 180 Peer A Peer B + (1) Peer C Peer D Peer E (1) Peer F (1) Peer G Peer H Peer I Peer J Emergence of a World Class Independent Current Permian Net Production (MBOE/
Slide 14: Consistent, Long Term Value Creation
Source: Capital IQ, Bloomberg. As of 2/9/2024. 14 Note: Peer Group includes DVN, EOG, MRO, OXY, PR and PXD. Total stockholder return; represents dividends as reinvested. Cash Flow per Share calculated as operating cash flow before changes in working capital divided by weighted average diluted shares
Slide 15: Return of Capital Framework
15 The Must-Own Permian Pure Play Return of Capital Framework Cumulative Return of Capital Paid Since Inaugural Base Dividend Note: Breakeven WTI oil price calculated as the per barrel price for oil needed to generate cash flow equivalent with the amount of capital required to keep its estimated Q4
Slide 16: Transformational Value Proposition
16 The Must-Own Permian Pure Play Transformational Value Proposition Source: FactSet. Market data as of 2/9/2024. Pioneer shown at acquisition value. OXY shown pro forma for CrownRock acquisition. Long duration, best in class FCF conversion positioned to deliver upside value Financial Strength World
Slide 17: The Must-Own Minerals Portfolio Offers Significant Value Upside Potential
17 The Must-Own Minerals Portfolio Offers Significant Value Upside Potential Permian Pure Play Key Highlights High royalty interest enhances further upside value creation Transaction adds significant in basin scale Enhances combined reinvestment rate through increased cash flow without burden
Slide 18: Leading ESG Profile
The Must-Own Permian Pure Play Leading ESG Profile Environmental Strategy Highlights Key Environmental Targets Reduce Scope 1 + 2 GHG intensity by at least 50% from 2020 levels by 2030 Reduce Scope 1 GHG intensity by at least 50% from 2019 levels by 2024 Reduce methane intensity by at least 70% from
Slide 19: Key Governance Elements of the Combined Company
The Must-Own Key Governance Elements of the Combined Company Permian Pure Play Leadership Travis Stice will continue as Chief Executive Officer and Chairman of the Board Diamondback will remain headquartered in Midland, TX Board of Directors Diamondback’s Board will be expanded to 13 directors
Slide 20: Leading Permian Position
Financial Strength Driving Results Through Lowest Cost Operations World Class Assets in a World Class Basin Leading Permian Position Creating the Must-Own Permian Pure Play Midland Basin PF Acreage Midland Acres: 694k Permian Acres: 838k Delaware Basin 18
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