Chord Energy Corporation · NASDAQ:CHRD
Chord Energy — Q3 2023 Earnings Presentation
18 slides from Chord Energy's earnings presentation, Nov 2, 2023
Slide 1: Delivering Value over the Next Decade
November 1, 2023 Delivering Value over the Next Decade
Slide 2: Important Disclosures
Important Disclosures Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical
Slide 3: Who is Chord: Premier Williston Basin Company
Who is Chord: Premier Williston Basin Company High Quality • Largest acreage position in Williston Basin 1,028K 94% 73% • 3Q23 Production: 101.4 MBopd / 176.0 MBoepd Williston Basin Asset • Inventory: ~10 years sub-$60/Bbl at 2023 pace1 Net Acres Operated3 Working Interest3 Disciplined Capital • Fla
Slide 4: Compelling Investment Opportunity
Compelling Investment Opportunity EBITDA Multiple1 Highlights 5.0 • Asset continues to outperform expectations 4.1x • Better performance with wider spacing FY24E EV/EBITDA 4.0 3.3x • 3-mile laterals improving returns 3.0 • Extensive analogs across basin improve predictability • Minimal parent / chil
Slide 5: Chord's Return of Capital Program
Chord’s Return of Capital Program 2023E Capital Allocation Return of Capital (“RoC”) Since Merger Significant Cash Generation $2,500 2023E Adjusted EBITDA - $1.73B1 $2,287 $1,135 $2,000 $1,450MM Returned to Shareholders $1,500 $Millions $553 Special3 $850MM - $880MM $1,000 $1,152 ~$800MM 2023E FCF1,
Slide 6: Chord Development Evolution
Chord Development Evolution Highlights Former Current CHRD Wild CHRD Wild CHRD Painted • 2015 vintage Basin Basin Woods • Completed 10-14 wells across 100 feet of vertical section 14 wells 6 wells 4 wells 2015 Current Current • Conclusion: Well density suboptimal Middle Bakken • Current development
Slide 7: Continued Progress Drives Returns Even Higher
Continued Progress Drives Returns Even Higher Conservative Well Spacing1 Strong Well Performance2 1,000 140 120 ~45% 800 Oil Rate per Well 100 Well Count Cumulative Oil 600 80 ~50pt IRR Uplift 400 60 40 200 20 0 0 0 100 200 300 400 0 50 100 150 200 250 Producing Days Producing Days Offset Wells <700
Slide 8: Deep Inventory Supports Sustainable Free Cash Flow
Deep Inventory Supports Sustainable Free Cash Flow Decade of Low-Cost Inventory1 Inventory by Breakeven WTI Price1 • 1,085 locations economic sub $60/Bbl 1,600 • Minimum 20% IRR fully loaded with G&A 1,400 1,374 Gross Operated Locations • 10k foot equivalent locations • XTO acquisition added 123 net
Slide 9: 3-Mile Laterals Improving Returns
3-Mile Laterals Improving Returns 3-Mile Laterals Drive Better Economics Improving Drilling Time1 • ~55-60% of remaining inventory 3-mile laterals 18 • ~50% of FY23E TILs 16 Basin Avg. 15.2 17.0 Days - Spud to RR (3-mile • ~20% increase in well costs, +40-50% EUR, = ~25pt increase in IRR 14 14.2 • E
Slide 10: Tracer Test: Three Mile Laterals – Strong Contribution from 3rd Mile
Tracer Test: Three Mile Laterals – Strong Contribution from 3rd Mile Tracer Testing – Foreman Butte1,2 3-Mile Well Performance • Test results show strong contribution from 3rd mile after Foreman Butte Tracer Test3 effective cleanout • Production contribution from all stages post cleanout to TD • Upl
Slide 11: Committed to continuous improvement of ESG Performance
Committed to continuous improvement of ESG Performance Rooted in our core values, we maintain sustainable energy practices that exemplify our commitment to energy security and availability Environmental Scope 1 Intensity Methane Reduction Spill Management Biodiversity 53% 47% 54% <1% Decrease in ope
Slide 12: Chord Energy = Premier FCF Focused E&P
Chord Energy = Premier FCF Focused E&P Premier Williston Operator Significant and Resilient Capital Returns Program to with Top Tier Assets Free Cash Flow Generation Deliver Significant Value Enhances size and scale with high quality TTM FCF1 of $827MM with a reinvestment Peer leading return of capi
Slide 13: Appendix
SS SSS SSS LSS Appendix
Slide 14: Compelling Valuation and Returns Profile
Compelling Valuation and Returns Profile Free Cash Flow Outlook1,2 2023E Leverage3 Enterprise Value vs. PV-104 $860 12.0% 1.2x 11.4% 1.1x 10.9% $16 $840 11.0% 1.0x $14.5B 10.3% $14 FY23E Net Debt / EBITDA $820 10.0% 0.8x $12 $800 $11.5B $ Millions FCF Yield $10 $9.4B $ Billions $780 9.0% 0.6x $8 $76
Slide 15: Return of Capital
Return of Capital Aim for peer-leading return of capital 3Q23 Return of Capital 1 ($MM, except per share) — Below 0.5x leverage: 75%+ of FCF — Below 1.0x leverage: 50%+ of FCF $207 3Q23 Free Cash Flow2 — >1.0x leverage: Base dividend+ ($5.00/sh annual) x 75% Target 75%+ at Current Leverage Calculati
Slide 16: 2023 Guidance
2023 Guidance Highlights Guidance Ranges • Implied FY23 metrics at midpoint run at $80 WTI / $3 HH 4Q23 FY23 Oil volumes (MBopd) 102.0 - 105.0 98.7 - 99.5 • Adjusted EBITDA: $1.73B NGL volumes (MBblpd) 35.5 - 36.5 35.1 - 35.3 • Adjusted FCF1: ~$800MM Natural gas volumes (MMcfpd) 224.0 - 230.0 224.0
Slide 17: Chord Financial and Operational Results
Chord Financial and Operational Results Financial Highlights ($MM) Q4 2022 Q1 2023 Q2 2023 Q3 2023 Key Operating Statistics Q4 2022 Q1 2023 Q2 2023 Q3 2023 Oil Revenues $738.0 $650.9 $647.9 $776.0 Oil Production (MBopd) 95.8 95.1 96.4 101.4 NGL Revenues 78.1 62.2 28.5 41.0 NGL Production (MBoepd) 37
Slide 18: Chord Energy Hedge Book
Chord Energy Hedge Book1 NYMEX WTI 4Q23 1Q24 2Q24 3Q24 4Q24 FY25 Swap volume (MBopd) 14.0 Strike ($/Bbl) $50.00 Two-way collar volume (MBopd) – pre-2023 12.0 Ceiling ($/Bbl) $64.88 Floor ($/Bbl) $45.00 Two-way collar volume (MBopd) – added 11.5 14.0 14.0 8.0 7.0 3.2 2023 Ceiling ($/Bbl) $88.93 $87.3