SM Energy : Acquisition of Uinta Basin Assets

Driving Differential Value Creation with Uinta Acquisition

JUNE 27, 2024

NYSE: SM

WEB: sm-energy.com

Legal Disclosures

Forward-looking Statements

This presentation contains forward-looking statements within the meaning of securities laws. The words "believes," "demonstrate," "estimate," "expect," "intends," "plan," "project," "target," and similar expressions are intended to identify forward-looking statements. Forward-looking statements in this release include, among other things: the anticipated impact of the acquisition by SM Energy of an undivided 80% interest of the Unita Basin oil and gas assets owned by certain entities affiliated with XCL Resources, LLC (the "XCL Acquisition"), including the consummation, timing and expected benefits of the XCL Acquisition; the quality of the acquired assets; the sources of financing for the transaction; post-closing pro forma financial metrics; the impact of the XCL Acquisition on the Company's financial condition and results of operations, including the potential for growth in Adjusted free cash flows(1) and Adjusted EBITDAX(1), and certain financial and operational projections. Operational projections include the number of acres to be acquired and growth in future locations and inventory, projected production metrics and oil mix, expected proved reserves to be acquired and the increase in total Company net proved reserves, expectations regarding break-even price and inventory life, the Company's expectation to serve as operator of the acquired assets, cash production margins(1), projected operating costs associated with the assets to be acquired, the number of benches of productive drilling opportunities, expectations regarding post-closing leverage and net debt(1), and the Company's expected reinvestment rate.

These statements involve known and unknown risks, which may cause SM Energy's actual results to differ materially from results expressed or implied by the forward-looking statements. Future results may be impacted by the risks discussed in the Risk Factors section of SM Energy's most recent Annual Report on Form 10-K, and such risk factors may be updated from time to time in the Company's other periodic reports filed with the Securities and Exchange Commission. The forward-looking statements contained herein speak as of the date of this release. Although SM Energy may from time to time voluntarily update its prior forward-looking statements, it disclaims any commitment to do so, except as required by securities laws.

Information on our website is not incorporated by reference into this presentation and should not be considered part of this document.

(1) Indicates a non-GAAP measure or metric. Please refer to the "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" slide in the Appendix.

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SM Energy Uinta Basin XCL Acquisition

$2.04B All Cash Acquisition (Net to SM Energy's 80% Undivided Interest)

Transaction Structure

• SM Energy has entered into an agreement to acquire the Uinta Basin oil and gas assets owned by certain entities affiliated with XCL Resources, LLC ("XCL") for an unadjusted purchase price of $2.55B
• Concurrently, Northern Oil and Gas, Inc. (NYSE: NOG) will acquire an undivided twenty percent (20%) of the oil and gas assets of XCL for $510 million
• All cash acquisition of $2.04B purchase price net to SM Energy's 80% undivided interest of the assets

UT

TX

Uinta		Midland Basin		South Texas

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Strategic Acquisition of XCL Resources

Value-Driven Acquisition Meets SM Energy's Strategic Objectives

More

Top-Tier Assets

Oil Production(1)

Increases ~45%(2)

Cash Production Margin(1,4)

Increases consolidated margin by ~11%(2)

Inventory(3)

~390 net locations

More Adjusted

Free Cash Flow(4) &

Return of Capital

Adj. EBITDAX (1,4)

Increases ~35%(2)

Adj. Free Cash Flow(1,4)

Increases ~45%(2)

Quarterly Dividend

Increasing 11% to

$0.20 / share

New Share Buyback

Authorization

$500MM

Maintaining

Strong Balance Sheet

All Cash Acquisition

$2.04B

Acquired at

2.9x NTM

Adj. EBITDAX multiple(4) $1.4MM per location(4,5) ~$14,250 per net acre(4,5)

Net Leverage Ratio(1,4)

< 1.0x by mid-2025

1. Metrics as of 2025E and based on $78.00/Bbl and $3.25/MMBtu flat pricing.
2. Percent change compared to SM Energy standalone case.

(3)	Locations normalized for 10K foot lateral length. ~550+ gross locations.	4
(4)	Indicates a non-GAAP measure or metric. Please refer to the "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" slide in the Appendix.
(5)	Assumes $35,000/Boed for PDP production.

Strategic Acquisition of XCL Resources

Value-Driven Acquisition Meets SM Energy's Strategic Objectives

EXPANDING TOP-TIER ASSET PORTFOLIO

SIGNIFICANT RESOURCE UPSIDE DRIVEN BY SM ENERGY TECHNICAL EXPERTISE

INCREASING ADJUSTED FREE CASH FLOW(4) AND RETURN OF CAPITAL TO STOCKHOLDERS

ALL CASH CONSIDERATION WHILE MAINTAINING STRONG BALANCE SHEET

1. Figures are net to SM Energy's 80% interest in the XCL acquisition.
2. Based on estimated production in September 2024E.
3. Next twelve months Adjusted EBITDAX based on $78.00/Bbl and $3.25/MMBtu flat pricing.
4. Indicates a non-GAAP measure or metric. Please refer to the "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" slide in the Appendix.

Transaction Highlights(1)

All Cash Acquisition

$2.04B

Net to SM Energy's 80%

Net Acres	~37,200
Current Production	43 MBoed(2)
Percent Oil	88%(2)
NTM Adj. EBITDAX	~$710 million(3,4)
'25E Adj. EBITDAX	~$685 million(3,4)
'25E FCF	~$255 million(3,4)
Net Locations	~390(5)
Proved Reserves	107 MMBoe(6)

(5)	Locations normalized for 10K foot lateral length. ~550+ gross locations.	5
(6)	XCL preliminary unaudited estimated proved reserves (88% oil) are as of

May 2024 at $75/Bbl and $2.75/MMBtu flat.

Expanding Top-Tier Portfolio

Significant Oil Increase, Margin Expansion and Lower Reinvestment Ratio

Net Daily Production(1)	Capital Budget(1)
21%	37%	25%	39%
~195	Net Daily Production	~$1.4B	Reinvestment Ratio
MBoed	↑ ~20%(2)		~63%, ↓ ~5%(2)
42%		36%
Consolidated Commodity Mix(1)	Cash Production Margin ($/Boe)(1,3)

NGL 15%

Oil Production ↑ ~45%(2)

$47.90

$50.45

Oil Mix↑ ~8%(2)

Gas

33%

Oil

52%

Midland Basin

Uinta

Uinta

Midland Basin

South Texas

~$37.90/Boe

Consolidated

Cash Production Margin

• ~11%(2)

(1) Pro forma metrics for combined assets are as of 2025E and are based on $78.00/Bbl and $3.25/MMBtu flat pricing.

(2) Percent change compared to SM Energy standalone case.6

(3) Indicates a non-GAAP measure or metric. Please refer to the "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" slide in the Appendix.

Expanding Top-Tier Portfolio

Returns Competitive with the Best

Compared to SM Energy(1):

Oil production from Uinta Upper and Lower Cubes is competitive with Midland and Austin Chalk

Compared to Industry in Other Basins(2):

Oil production from Uinta Upper and Lower Cubes is competitive with Midland, Delaware and Austin Chalk / Eagle Ford industry averages

1. XCL Lower Cube and XCL Upper Cube curves: Enverus data as of June 19, 2024. Wells post 2019.
   SM Midland Basin curve: Enverus data as of April 11, 2024 | Horizontal wells completed in Howard County, January 2021 through December 2023 | Peers include Bayswater, Birch Operations, CPE, CrownQuest Operating, CVX, Endeavor Energy Resources, FANG, HighPeak Energy, HOG Resources, Murchison Oil & Gas, OVV, OXY, Paladin Petroleum, PXD, SGY, Spirit O&G Operating, SOGC and VTLE. SM Austin Chalk curve: Enverus data as of April 15, 2024 | Oil production in the West Condensate area of the Austin Chalk | Horizontal wells completed January 2019 through December 2023 | Peers include CRGY, Endeavor Natural Gas, Grit Oil & Gas and SBOW/CHK.
2. Enverus data as of June 19, 2024 | Horizontal wells completed post 2010 for XCL Lower Cube and XCL Upper Cube wells, and for the Midland, Delaware and Western Gulf of Mexico Basins.

Cumulative Oil Production	(MBbl/10,000 ft)
Avg

Cumulative Oil Production	(MBbl/10,000 ft)
Avg

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Expanding Top-Tier Portfolio

+ More Than 75,000 Net Acres Added ~Past Year: High Quality Scale

High

Quality

PRO FORMA ESTIMATED

AVERAGE RETURN(1)

~70%

TOTAL COMPANY

INVENTORY

(+5% INCREASE(2))

Long

Duration

~12+ YEARS

PRO FORMA

MIDLAND BASIN,

SOUTH TEXAS & UINTA(1)

(+2 YEARS)

More

Upside

• Uinta Stacked Pay
• Klondike
• Sweetie Peck "Stealth"
• Austin Chalk

The technical team has had significant success in the past, including successfully pushing the boundaries of the Midland Basin further east in Howard County in the early days of the Permian and being able to drive the consistent results in the South TX Austin Chalk."(3)

(1)	SM Energy's inventory assessment as of 1/1/2024 plus XCL preliminary estimated inventory for XCL assets as estimated by SM Energy.	8
(2)	Percentage change compared to SM Energy standalone case.
(3)	J.P.Morgan | Zach Parham | Inside the Corner Suite: 10 Key Takeaways from Fireside Chat with CEO Herb Vogel and CFO Wade Pursell | 6/13/24.

Significant Resource Upside Driven By SM Energy Technical Expertise

Track Record in Full Stack Co-Development to Optimize Value

• Core-of-the-corein Uinta with stacked pay potential with leading productivity and oil content
• Nearly ~4,000' of stacked pay | over-pressuredsource rocks
• SM Energy's track record in Howard County and Maverick Basin delivers peer leading results via optimized co-development; we expect to repeat that to drive differential value to XCL assets
• As a premier operator of top-tier assets, we are well positioned to optimize drilling, completions, and development spacing in the proven Lower Cube
• SM Energy applied Lower Cube learnings to see the full potential of tremendous, delineated, oily resource-in-place in the Upper Cube
• Produced oil from Upper and Lower Cubes verify development independence
• SM Energy is poised to de-riskunquantified horizontal potential in deeper targets demonstrated by historical vertical production with test wells in progress

Reservoir Pressure Heat Map of XCL Acreage

UPPER CUBE

5 BENCHES 1,000'

LOWER CUBE

6 BENCHES 1,025'

LOWER GARDEN GULCH

UPPER DOUGLAS CREEK

MIDDLE DOUGLAS CREEK

LOWER DOUGLAS CREEK BLACK SHALE

CASTLE PEAK CASTLE PEAK LIME UTELAND BUTTE WASATCH 5 UPPER

WASATCH 5 LOWER

WASATCH 4

WASATCH 3

WASATCH 2

DEEP TARGETS

6 BENCHES 1,675'

WASATCH 1

UPPER FLAGSTAFF

MIDDLE FLAGSTAFF

LOWER FLAGSTAFF

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Significant Resource Upside Driven By SM Energy Technical Expertise

Stacked Pay Potential Proven and Emerging across as many as 17 Benches

 Over 900 MMBbls oil produced from 8,500+ Wasatch and Green River wells to date

 800+ horizontal producers in the proven Lower Cube

 More than 15 horizontals from multiple operators in the high-confidence but emerging Upper Cube

 Significant opportunity from deeper intervals proven vertically with horizontal results forthcoming

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