California Resources Corporation · NYSE:CRC
California Resources — Q1 2021 Earnings Presentation
20 slides from California Resources's earnings presentation, May 14, 2021
Slide 1: 1Q21 Earnings Presentation: Charting a new course
“Charting a new course” 1Q21 Earnings Presentation May 13, 2021
Slide 2: Presenters: Mac McFarland and Francisco Leon
Mac McFarland President & CEO Francisco Leon EVP & CFO
Slide 3: Forward Looking / Cautionary Statements – Certain Terms
Forward Looking / Cautionary Statements – Certain Terms The information included herein contains forward-looking statements that involve risks and uncertainties that could materially affect our expected results of operations, liquidity, cash flows and business prospects. Such statements include thos
Slide 4: Key Quarterly Highlights – Underlining Solid Business Fundamentals
Key Quarterly Highlights – Underlining Solid Business Fundamentals ADJ. EBITDAX1 FREE CASH FLOW1 NET DEBT1 $189MM $120MM $470MM 1st Quarter 2021 PRODUCTION OPERATIONS HSE 17 Drilled | 15 Online | 40 Workover 99 Mboe/d Wells 0.00 LTIR2 | 0.27 IIR3 61% Oil 1 Drilling | 30 Maintenance No Major Incident
Slide 5: Trending to High-End of 2021 FCF Guidance & Initiating Share Repurchase Program
Trending to High-End of 2021 FCF Guidance & Initiating Share Repurchase Program PRIOR REVISED IMPROVING GUIDANCE GUIDANCE G&A COST ~ $5/boe STRUCTURE FY 2021E1 FY 2021E1 E2021 G&A cost per boe2 is trending down toward low end of range Total Production Reaffirmed 96 – 99 (Mboepd) Trending to high end
Slide 6: CRC's Reserves Value at Current Prices Provides Equity Upside
CRC’s Reserves Value at Current Prices Provides Equity Upside CURRENT OIL PRICING OFFERS ROBUST UPSIDE RESERVES MULTIPLE COMPARED TO PEERS4 SHOWS STRONG INVESTMENT OPPORTUNITY 8.0x 7.0x $5,720 MM3 6.0x PV-10 Reserves EV/SMOG5 ~10% PUD 5.0x Value1 and Metrics 4.0x At SEC Price Deck and Today’s Prices
Slide 7: First Quarter 2021 Results Comparison
First Quarter 2021 Results Comparison 1Q21 SNAPSHOT 1 1 1 1Q20 4Q20 1Q21 Predecessor Non-GAAP Successor Sacramento Basin Net Oil Production (MBbl/d) 77 63 60 ~3,000 BOE per day Total Net Production (MBoe/d) 121 103 99 Realized Oil Price w/ Hedge ($/Bbl) $55.50 $44.39 $53.73 San Joaquin Basin ~73,000
Slide 8: First Quarter 2021 Cost Comparison
First Quarter 2021 Cost Comparison 1Q201 4Q201 1Q211 Predecessor Non-GAAP Successor INTEGRATED BUSINESS MODEL & OPERATIONAL PERFOMANCE Energy operating costs2 ($/Boe) $3.71 $4.39 $4.70 DRIVING CASH FLOWS $250 Gas processing costs ($/Boe) $0.67 $0.59 $0.53 Non-energy operating costs2 ($/Boe) $13.00 $
Slide 9: Hedging Program Protects Cash Flow
Hedging Program Protects Cash Flow STRATEGY OIL HEDGE PROTECTION1 as of April 30, 2021 ▪ CRC hedging strategy typically utilizes a mixture of Puts, Collars 2Q21 3Q21 4Q21 1H22 2H22 Jan-Oct 23 and Swaps to protect cash flow and to ensure CRC’s ability to live within cash flow, and is also aligned wit
Slide 10: Maintaining Balance Sheet Strength, Liquidity, and Financial Flexibility
Maintaining Balance Sheet Strength, Liquidity, and Financial Flexibility ESTIMATED LIQUIDITY ROLL FORWARD1 3/31/21 DEBT SNAPSHOT $800 ~$680 MM $700 ($ in millions) $600 $545 MM Revolving Credit Facility (RCF) $ 0 $500 7.125% Senior Notes 600 $ Millions $400 Face Value of Debt $ 600 $300 Less Availab
Slide 11: ESG Strategy Evolving to Reflect the Energy Transition to Net Zero
ESG Strategy Evolving to Reflect the Energy Transition to Net Zero CRC’S MANAGEMENT AND THE BOARD OF DIRECTORS ARE UNDERGOING A THOROUGH REVIEW OF CRC’S ESG STRATEGY TO ENHANCE ITS DECARBONIZATION INITIATIVES CONTINUE TO STRENGTHEN 2030 MAINTAIN REPORTING TRANSPARENCY FOCUS ON DECARBONIZATION & SUST
Slide 12: CRC's Strong Foundation Provides Quality Investment Opportunity
CRC’s Strong Foundation Provides Quality Investment Opportunity New Strategic Direction Strong Financial Position Cash-Advantaged Portfolio Integrated Model Committed to ESG Advancement California Resources Corporation 12 May 13, 2021
Slide 13: Supplemental Materials
AENTAL MATERIALS EME a ) SUPPLI ' =i pti id ddd Lr
Slide 14: Introducing a New Chair of the Board
Introducing a New Chair of the Board ▪ Appointed Chair of the Board in April 2021; Director since 2020 ▪ 26 years of energy experience in both financial and operational appointments Tiffany (TJ) Thom Cepak ▪ Serving as Director of Patterson-UTI since August 2014 and as a Director of Penn Virginia Ch
Slide 15: CRC: Focused on Decreasing GHG Emissions
CRC : Focused on Decreasing GHG Emissions TOTAL 2020 EMISSIONS CONTINUE TO FALL… California has the most stringent air quality laws and regulations Total GHG Emissions from Integrated Operations 4.0 governing oil and natural gas production, transportation, and other commercial and industrial develop
Slide 16: Shifting Capital to Improve Capital Efficiency
Shifting Capital to Improve Capital Efficiency STRONG FOCUS ON BEST OPPORTUNITIES INCREMENTAL 2021E REVISED CAPITAL PROGRAM OF $185MM - $210MM BARRELS THROUGH MAINTENANCE ▪ ~90% of CRC’s net active wells are on artificial lift. Due to a backlog of wells Infrastructure accumulated in 2020, CRC has th
Slide 17: CRC Price Realizations Remained Strong in CA's Improving Market Dynamics
CRC Price Realizations Remained Strong in CA’s Improving Market Dynamics OIL PRICE REALIZATION (WITH HEDGES) NATURAL GAS PRICE REALIZATION WTI Realizations Brent $80 $4.00 NYMEX Realizations $70 $61.10 $/MMBtu & $/Mcf $3.50 $3.29 $55.50 $3.03 $60 $57.84 $/Bbl $50.96 $43.37 $45.24 $3.00 $50 $42.15 $4
Slide 18: Integrated Assets and Ancillary Businesses Further Support Financials
Integrated Assets and Ancillary Businesses Further Support Financials STRATEGIC INTEGRATION AND OPERATIONAL STREAMLINING INCREMENTAL REVENUE CAPTURE ▪ Elk Hills Power Plant reduces OPEX ~$100MM/year, allows for more ▪ Additional liquids by processing off spec gas efficient operation of asset ▪ Sale
Slide 19: Leverage Reconciliation
Leverage Reconciliation Leverage and Net Debt We calculate the leverage ratio by dividing net debt by adjusted EBITDAX for (in millions) Low High the applicable period. We define net debt as the face value of our debt less Face value of debt $600 $600 available cash. We believe the leverage ratio is
Slide 20: Investor Relations and Media Contacts
Joanna Park (Investor Relations) Richard Venn (Media) 818-661-3731 818-661-6014 Joanna.Park@crc.com Richard.Venn@crc.com