Southwestern Energy — Merger or Acquisition (January 2024)
15 slides from Southwestern Energy's merger presentation, Jan 11, 2024
Slide 1: Accelerating America's Energy Reach
Accelerating America’s Energy Reach Fueling a More Affordable, Reliable and Lower Carbon Future JANUARY 11, 2024
Slide 2: Additional Information and Where to Find It
Accelerating America’s Energy Reach 2 ADDITIONAL INFORMATION AND WHERE TO FIND IT In connection with the proposed transaction between Chesapeake Energy Corporation (“Chesapeake”) and Southwestern Energy Comp any (“Southwestern”), Chesapeake intends to file with the U.S. Securities and Exchange Commi
Slide 3: Forward-Looking Statements
Accelerating America’s Energy Reach 3 This communication contains “forward - looking statements” within the meaning of the federal securities laws. Forward - looking stat ements may be identified by words such as “anticipates,” “believes,” “cause,” “continue,” “could,” “depend,” “develop,” “estimate
Slide 4: Transaction Overview
Accelerating America’s Energy Reach 4 Accelerating America’s Energy Reach Pro Forma Ownership ~60% / ~40% Chesapeake / Southwestern Stock - for - Stock Exchange 0.0867 shares of CHK common stock for each share of SWN common stock Combined Enterprise Value ~$24 billion TRANSACTION OVERVIEW Expanding
Slide 5: Combination Advances Strategic Pillars
STRATEGIC PILLARS Superior Capital Returns Deep, Attractive Inventory Premier Balance Sheet Sustainability Leadership Most efficient operator, returning more cash to shareholders than domestic gas peers Premium rock, returns, runway with best - in - class execution Investment Grade quality balance s
Slide 6: Premier Natural Gas Portfolio
LA TX OH WV PA PA NY Clear Industrial Logic with Complementary Positions in Premium Basins Accelerating America’s Energy Reach 6 Premier Natural Gas Portfolio PREMIER PORTFOLIO REACHING MORE MARKETS SYNERGIES + ACCRETION CAPITAL STRUCTURE SUSTAINABILITY LEADERSHIP Note: 3 Q23 actual production for C
Slide 7: Creates a Globally Relevant Natural Gas Producer
Creates a Globally Relevant Natural Gas Producer 3Q23 Actual Gas Production (bcf/d) 7.9 7.7 7.1 7.0 5.7 5.0 4.9 3.1 2.9 2.3 2.3 2.1 1.8 1.7 1.6 1.4 1.4 1.4 1.1 CVX XOM CHK + SWN SHEL BP EQT EQNR TTE COP CTRA TOU AR WDS OXY EOG OVV RRC CNX ARX DVN Accelerating America’s Energy Reach 7 Scale Enhances
Slide 8: Together We Are LNG Ready
Accelerating America’s Energy Reach 8 ▪ Diversified portfolio with >25 sales points ▪ Scaled assets in proximity to Gulf Coast / LNG corridor ▪ Link up to 20% of production to international markets ▪ Establishes global platform to enhance marketing and trading business based in Houston Together We A
Slide 9: Identified Synergies Enhance Shareholder Value
Accelerating America’s Energy Reach 9 Identified Synergies Enhance Shareholder Value Complementary Operations Lead to Significant Pro Forma Synergies Annual Synergies ($ millions) (1) Capital P&L ~$400/yr PREMIER PORTFOLIO REACHING MORE MARKETS SYNERGIES + ACCRETION CAPITAL STRUCTURE SUSTAINABILITY
Slide 10: Delivering Increased Shareholder Returns
$1,900 $1,600 $800 $700 $400 $400 $300 $300 COP EOG DVN FANG CHK + SWN OXY CTRA APA OVV MRO EQT Delivering Increased Shareholder Returns Accelerating America’s Energy Reach 10 ▪ ~20% more dividends per share projected over next five years ▪ Flexibility for additional returns through debt paydown and
Slide 11: Investment Grade Quality Capital Structure
Investment Grade Quality Capital Structure Accelerating America’s Energy Reach 11 ▪ Expected to reach <1.0x net debt / EBITDAX within one year of closing (2) ▪ Commitment to utilize cash - on - hand to repay debt • Targeting ~$1.1B of debt retirement by YE25 ▪ “Hedge - the - wedge” strategy continue
Slide 12: Sustainability Leadership
Accelerating America’s Energy Reach 12 ▪ 100% RSG certified across all basins and production ▪ Low - emissions intensity leader focused on continuous improvement ▪ Committed to achieving net zero Scope 1 and 2 GHG emissions by 2035 Sustainability Leadership Deliver energy to accelerate economic prog
Slide 13: Combination Benefits All Stakeholders
Accelerating America’s Energy Reach • Positioned to grow production and deliver lower - cost gas for domestic and international consumers • Diversified asset base provides confidence for longer - term supply agreements • Ability to return more cash with lower volatility through price cycles • Invest
Slide 14: Meeting Our Non-Negotiables
Don’t overpay. • Attractive relative valuation and balanced contribution from both companies • ~$400 million in annual synergies, with upside Protects balance sheet. • Expects to achieve pro forma net debt / EBITDAX under 1.0x within one year from closing (1) • Accelerates path to Investment Grade A
Slide 15: Premier Natural Gas Portfolio
Accelerating America’s Energy Reach 15 PREMIER PORTFOLIO REACHING MORE MARKETS SYNERGIES + ACCRETION CAPITAL STRUCTURE SUSTAINABILITY LEADERSHIP Accelerating America’s Energy Reach Fueling a More Affordable, Reliable and Lower Carbon Future Premier Natural Gas Portfolio Combination of three premier
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