SM Energy Reports Third Quarter 2026 Results

¹ Adjusted net income and adjusted net income per diluted share; capital expenditures before changes in accruals; adjusted free cash flow; adjusted EBITDAX; and net debt are non-GAAP measures. Refer to "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" and the accompanying reconciliations later in this release.

Production

4Q 2026

Full Year 2026

Total Production (MMBoe)¹

40 – 41

153 – 154

Total Production (MBoe/d)¹

435 – 445

420 – 422

Oil Production (MBbl/d)¹

229 – 239

220 – 222

Capital Program ($MM)

Capital Expenditures²

~$610

~$2,750

DC&E

~$2,400

Facility, Land, and Other

~$280

One-Time Capital Costs³

~$70

Net Wells Drilled

~55

~245

Net Wells Turned-In-Line

~80

~295

Avg. Well Cost ($/lateral ft)⁴

~$710

Operating Expenses ($/Boe)

Lease Operating Expense

$6.60 – $6.80

Transportation

$3.55 – $3.65

Production Taxes (% of oil, gas and NGL revenue)

~6%

Ad Valorem Taxes

~$0.50

DD&A

~$14.50

General & Administrative ($MM)

Recurring G&A⁵

$230 – $250

One-Time Transaction & Integration — Cash⁶

~$160

One-Time Transaction & Integration — Non-Cash⁶

~$20

Other ($MM)

Exploration Expense

~$100

Cash Taxes

$100 – $120

Notes:

¹ Full-year 2026 production guidance includes 11 months of Civitas contribution following the January 30, 2026, Merger close, the conversion of certain acquired volumes to two-stream reporting, and four months of production from certain South Texas assets divested on April 30, 2026 (the "Galvan Divestiture"). Fourth quarter 2026 oil guidance includes the continued impact of Uinta takeaway constraints, which are expected to be resolved in early 2027.

² Indicates a non-GAAP measure or metric. Refer to "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" and the accompanying reconciliations later in this release. Full-year 2026 capital expenditures before changes in accruals include ~$50 million of expected synergies.

³ Includes one-time, non-recurring capital costs related to Merger integration and the Galvan Divestiture.

⁴ Company-wide average 2026 expected well cost, including well connection/equipment costs.

⁵ Full-year 2026 recurring G&A guidance includes ~$35 million of stock-based compensation. Recurring G&A in fourth quarter 2026 is expected to be higher quarter over quarter due to year-end items.

⁶ The majority of one-time transaction and integration costs (both cash and non-cash) were incurred in the first half of 2026.

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Production Data

For the Three Months Ended

Percent
Change

 Between

For the Nine Months Ended

Percent
Change
Between

September
30,

June

30,

September
30,

3Q26

& 2Q26

September
30,

September
30,

YTD 2026
& 2025

2026

2026

2025

2026

2025

Realized sales price (before the effect of net derivative settlements):

Oil (per Bbl)

$       85.76

$       96.85

$       63.83

(11) %

$       86.19

$       65.28

32 %

Gas (per Mcf)

$         2.48

$         0.17

$         2.19

1,359 %

$         1.43

$         2.54

(44) %

NGLs (per Bbl)

$       29.40

$       24.69

$       20.79

19 %

$       25.33

$       22.73

11 %

Equivalent (per Boe)

$       54.23

$       53.86

$       41.23

1 %

$       51.15

$       43.15

19 %

Realized sales price (including the effect of net derivative settlements):¹

Oil (per Bbl)

$       73.92

$       80.62

$       65.40

(8) %

$       75.03

$       66.61

13 %

Gas (per Mcf)

$         2.99

$         1.54

$         2.77

94 %

$         2.26

$         2.97

(24) %

NGLs (per Bbl)

$       29.45

$       24.83

$       20.79

19 %

$       25.44

$       22.42

13 %

Equivalent (per Boe)

$       49.02

$       48.36

$       43.21

1 %

$       47.11

$       44.68

5 %

Net production volumes:^2,3

Oil (MMBbl)

21.2

20.9

10.5

1 %

59.2

30.3

95 %

Gas (Bcf)

84.4

86.8

38.5

(3) %

243.5

111.1

119 %

NGLs (MMBbl)

4.6

4.6

2.8

(1) %

13.5

7.6

77 %

Equivalent (MMBoe)

39.8

40.0

19.7

— %

113.3

56.5

101 %

Average net daily production:^2,3

Oil (MBbl per day)

230.2

229.8

113.9

— %

216.9

111.2

95 %

Gas (MMcf per day)

917.0

953.7

418.2

(4) %

892.0

406.9

119 %

NGLs (MBbl per day)

50.1

51.0

30.2

(2) %

49.3

27.8

77 %

Equivalent (MBoe per day)

433.1

439.7

213.8

(2) %

414.9

206.8

101 %

Per Boe data:²

Lease operating expense

$         7.02

$         6.71

$         5.67

5 %

$         6.69

$         5.76

16 %

Transportation costs

$         3.53

$         3.57

$         3.77

(1) %

$         3.58

$         3.94

(9) %

Production taxes

$         3.47

$         3.25

$         1.69

7 %

$         3.09

$         1.78

74 %

Ad valorem tax expense

$         0.38

$         0.37

$         0.51

3 %

$         0.40

$         0.53

(25) %

General and administrative^4,5

$         1.40

$         1.98

$         2.00

(29) %

$         2.72

$         2.14

27 %

Net derivative settlement gain (loss)

$        (5.20)

$        (5.50)

$         1.98

5 %

$        (4.04)

$         1.53

(364) %

Depletion, depreciation, and amortization

$       14.81

$       14.81

$       16.54

— %

$       14.25

$       15.73

(9) %

¹ Indicates a non-GAAP metric calculated as the average realized price after the effects of net commodity derivative settlements. The Company believes this
metric is useful to management and the investment community to understand the effects of net commodity derivative settlements on average realized price.

² Amounts and percentage changes may not calculate due to rounding.

³ The results for the nine months ended September 30, 2026, include eight months of production from the Civitas assets acquired on January 30, 2026, and four
months of production from the Galvan Divestiture on April 30, 2026.

⁴ Includes recurring non-cash stock-based compensation expense of $0.26, $0.12, and $0.34 per Boe for the three months ended September 30, 2026, June 30,
2026, and September 30, 2025, respectively, and $0.21 and $0.30 per Boe for the nine months ended September 30, 2026, and 2025, respectively.

⁵ Includes one-time costs (consisting of both cash and non-cash items) of $0.11 per Boe and $0.92 per Boe for the three months ended September 30, 2026
and June 30, 2026, respectively, and $1.40 per Boe for the nine months ended September 30, 2026.

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Condensed Consolidated Balance Sheets

(in millions, except share data)

September 30,

December 31,

ASSETS

2026

2025

Current assets:

Cash and cash equivalents

$                   442

$                   368

Accounts receivable

1,175

331

Derivative assets

93

83

Prepaid expenses and other

107

29

Total current assets

1,817

811

Property and equipment (successful efforts method):

Proved oil and gas properties

23,924

16,012

Accumulated depletion, depreciation, and amortization

(9,040)

(8,793)

Unproved oil and gas properties, net of valuation allowance of $12 and $12, respectively

885

460

Wells in progress

848

458

Other property and equipment, net of accumulated depreciation of $68 and $63, respectively

138

65

Total property and equipment, net

16,755

8,202

Noncurrent assets:

Derivative assets

12

6

Other noncurrent assets

379

234

Total noncurrent assets

391

240

Total assets

$              18,963

$                9,253

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued expenses

$                2,505

$                   690

Senior Notes, net

—

419

Derivative liabilities

552

2

Other current liabilities

130

58

Total current liabilities

3,187

1,169

Noncurrent liabilities:

Revolving credit facility

—

—

Senior Notes, net

6,614

2,296

Asset retirement obligations

426

150

Deferred tax liabilities, net

609

724

Derivative liabilities

13

2

Other noncurrent liabilities

337

102

Total noncurrent liabilities

7,999

3,274

Stockholders' equity:

Common stock, $0.01 par value - authorized: 400,000,000 and 200,000,000 shares, respectively;
issued and outstanding: 235,615,045 and 114,630,905 shares, respectively

2

1

Additional paid-in capital

3,813

1,517

Retained earnings

3,961

3,291

Accumulated other comprehensive income

1

1

Total stockholders' equity

7,777

4,810

Total liabilities and stockholders' equity

$              18,963

$                9,253

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Condensed Consolidated Statements of Operations

(in millions, except per share data)

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

2026

2025

2026

2025

Operating revenues and other income:

Oil, gas, and NGL production revenue

$             2,160

$                811

$             5,793

$             2,436

Gain (loss) on divestiture activity

(2)

—

260

—

Other operating income

12

1

96

13

Total operating revenues and other income

2,170

812

6,149

2,449

Operating expenses:

Oil, gas, and NGL production expense

574

229

1,558

678

Depletion, depreciation, and amortization

590

325

1,614

888

Exploration¹

22

12

69

39

General and administrative^1,2

56

39

309

121

Net derivative (gain) loss³

684

(45)

1,109

(107)

Other operating expense²

8

5

56

12

Total operating expenses

1,934

565

4,715

1,631

Income from operations

236

246

1,434

818

Interest expense

(116)

(43)

(340)

(130)

Other non-operating income, net

3

1

8

1

Income before income taxes

123

204

1,102

689

Income tax expense

(30)

(49)

(273)

(150)

Net income

$                 93

$                155

$                829

$                539

Basic weighted-average common shares outstanding

237

115

225

115

Diluted weighted-average common shares outstanding

239

115

226

115

Basic net income per common share

$               0.39

$               1.35

$               3.67

$               4.70

Diluted net income per common share

$               0.39

$               1.35

$               3.66

$               4.69

¹ Recurring non-cash stock-based compensation included in:

Exploration expense

$                   2

$                   1

$                   7

$                   4

General and administrative expense

11

7

23

17

Total non-cash stock-based compensation

$                 13

$                   8

$                 30

$                 21

² Transaction and integration costs included in:

General and administrative⁴

$                   4

$                  —

$                159

$                  —

Other operating expense

1

—

18

—

Total transaction and integration costs

$                   5

$                  —

$                177

$                  —

³ The net derivative (gain) loss line item consists of the following:

Net derivative settlement (gain) loss

$                207

$                (39)

$                457

$                (86)

Net (gain) loss on fair value changes

477

(7)

652

(20)

Total net derivative (gain) loss

$                684

$                (45)

$             1,109

$              (107)

Note: Per common share amounts, and prior year amounts may not calculate due to rounding.

⁴ Includes less than $1 million and $20 million of non-cash stock-based compensation associated with the Merger for the three and nine months ended September 30, 2026, respectively.

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Condensed Consolidated Statements of Stockholders' Equity

(in millions, except share data and dividends per share)

Additional
Paid-in
Capital

Retained
Earnings

Accumulated
Other
Comprehensive
Income (Loss)

Total
Stockholders'
Equity

Common Stock

Shares

Balances, December 31, 2025

114,630,905

$           1

$       1,517

$       3,291

$               1

$        4,810

Net loss

—

—

—

(335)

—

(335)

Net cash dividends declared, $0.22 per
share

—

—

—

(53)

—

(53)

Issuance of common stock upon vesting
of RSUs and settlement of PSUs, net of
shares used for tax withholdings

235,422

—

(17)

—

—

(17)

Stock-based compensation expense

1,114,479

—

25

—

—

25

Replacement equity awards issued in
connection with the Merger

—

—

29

—

—

29

Issuance of common stock in connection
with the Merger

123,715,771

1

2,408

—

—

2,409

Balances, March 31, 2026

239,696,577

$           2

$       3,962

$       2,903

$               1

$        6,868

Net income

—

—

—

1,071

—

1,071

Other comprehensive income

—

—

—

—

1

1

Net cash dividends declared, $0.22 per
share

—

—

—

(53)

—

(53)

Issuance of common stock under
Employee Stock Purchase Plan

147,743

—

2

—

—

2

Issuance of common stock upon vesting
of RSUs and settlement of PSUs, net of
shares used for tax withholdings

216,257

—

(3)

—

—

(3)

Stock-based compensation expense

77,303

—

11

—

—

11

Purchase of shares under Stock
Repurchase Program

(2,643,506)

—

(84)

—

—

(84)

Balances, June 30, 2026

237,494,374

$           2

$       3,888

$       3,921

$               2

$        7,813

Net income

—

—

—

93

—

93

Other comprehensive loss

—

—

—

—

(1)

(1)

Net cash dividends declared, $0.22 per
share

—

—

—

(53)

—

(53)

Issuance of common stock upon vesting
of RSUs and settlement of PSUs, net of
shares used for tax withholdings

423,998

—

(6)

—

—

(6)

Stock-based compensation expense

—

—

14

—

—

14

Purchase of shares under Stock
Repurchase Program

(2,303,327)

—

(83)

—

—

(83)

Balances, September 30, 2026

235,615,045

$           2

$       3,813

$       3,961

$               1

$        7,777

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Condensed Consolidated Statements of Stockholders' Equity (Continued)

(in millions, except share data and dividends per share)

Additional
Paid-in
Capital

Accumulated
Other
Comprehensive
Loss

Total
Stockholders'
Equity

Common Stock

Retained
Earnings

Shares

Balances, December 31, 2024

114,461,934

$                1

$          1,502

$          2,735

$                    (1)

$            4,237

Net income

—

—

—

182

—

182

Net cash dividends declared, $0.20 per
share

—

—

—

(23)

—

(23)

Issuance of common stock upon vesting
of RSUs, net of shares used for tax
withholdings

284

—

—

—

—

—

Stock-based compensation expense

—

—

7

—

—

7

Balances, March 31, 2025

114,462,218

$                1

$          1,509

$          2,895

$                    (1)

$            4,404

Net income

—

—

—

202

—

202

Net cash dividends declared, $0.20 per
share

—

—

—

(23)

—

(23)

Issuance of common stock under
Employee Stock Purchase Plan

90,314

—

2

—

—

2

Stock-based compensation expense

82,193

—

6

—

—

6

Balances, June 30, 2025

114,634,725

$                1

$          1,517

$          3,074

$                    (1)

$            4,590

Net income

—

—

—

155

—

155

Net cash dividends declared, $0.20 per
share

—

—

—

(23)

—

(23)

Issuance of common stock upon vesting
of RSUs and settlement of PSUs, net of
shares used for tax withholdings

364,172

—

(5)

—

—

(5)

Stock-based compensation expense

—

—

8

—

—

8

Purchase of shares under Stock
Repurchase Program

(444,705)

—

(12)

—

—

(12)

Balances, September 30, 2025

114,554,192

$                1

$          1,508

$          3,205

$                    (1)

$            4,713

_____________________________

Note: Prior year amounts may not calculate due to rounding.

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Condensed Consolidated Statements of Cash Flows

(in millions)

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

2026

2025

2026

2025

Cash flows from operating activities:

Net income

$           93

$          155

$          829

$          539

Adjustments to reconcile net income to net cash provided by operating activities:

(Gain) loss on divestiture activity

2

—

(260)

—

Depletion, depreciation, and amortization

590

325

1,614

888

Stock-based compensation expense

14

8

50

21

Net derivative (gain) loss

684

(45)

1,109

(107)

Net derivative settlement gain (loss)

(207)

39

(457)

86

Amortization of deferred financing costs and debt premiums,
net

(6)

3

(16)

8

Deferred income tax (benefit) expense

(7)

76

224

145

Other, net

20

(3)

(18)

(7)

Net change in working capital

(61)

(53)

(210)

(15)

Net cash provided by operating activities

1,122

505

2,865

1,559

Cash flows from investing activities:

Net proceeds from the sale of oil and gas properties

(8)

—

889

—

Capital expenditures

(711)

(398)

(2,020)

(1,222)

Acquisition of business, net of cash acquired

—

—

(49)

—

Other

(27)

(7)

(51)

(22)

Net cash used in investing activities

(746)

(405)

(1,231)

(1,244)

Cash flows from financing activities:

Proceeds from revolving credit facility

379

185

720

1,570

Repayment of revolving credit facility

(379)

(185)

(720)

(1,638)

Net proceeds from Senior Notes

—

—

984

—

Cash paid to repurchase Senior Notes

(417)

—

(2,160)

—

Repurchase of common stock

(79)

(12)

(166)

(13)

Dividends paid

(52)

(23)

(187)

(69)

Other, net

(6)

(5)

(31)

(3)

Net cash used in financing activities

(554)

(40)

(1,560)

(153)

Net change in cash, cash equivalents, and restricted cash

(178)

60

74

162

Cash, cash equivalents, and restricted cash at beginning of period

620

102

368

—

Cash, cash equivalents, and restricted cash at end of period

$          442

$          162

$          442

$          162

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Condensed Consolidated Statements of Cash Flows (continued)

(in millions)

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

2026

2025

2026

2025

Supplemental schedule of additional cash flow information:

Operating activities: Cash paid for interest, net of capitalized
interest

$             (146)

$               (80)

$             (331)

$             (165)

Operating activities: Net cash (paid) received for income taxes

$                  2

$                 (1)

$               (30)

$                 (6)

Investing activities: Changes in capital expenditure accruals

$                36

$               (74)

$              116

$               (70)

_____________________________

Note: Prior year amounts may not calculate due to rounding.

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Adjusted EBITDAX Reconciliation¹

Reconciliation of net income (GAAP) and net cash
provided by operating activities (GAAP) to Adjusted
EBITDAX (non-GAAP):

For the Three Months Ended
September 30,

For the Nine Months Ended

September 30,

(in millions)

2026

2025

2026

2025

Net income (GAAP)

$                   93

$                 155

$                 829

$                 539

Interest expense

116

43

340

130

Income tax expense

30

49

273

150

Depletion, depreciation, and amortization

590

325

1,614

888

Exploration²

20

10

62

34

Stock-based compensation expense³

13

8

30

21

Net derivative (gain) loss

684

(45)

1,109

(107)

Net derivative settlement gain (loss)

(207)

39

(457)

86

(Gain) loss on divestiture activity

2

—

(260)

—

Transaction and integration costs⁴

5

—

177

—

Other, net

(5)

4

—

5

Adjusted EBITDAX (non-GAAP)

1,341

588

3,717

1,747

Interest expense

(116)

(43)

(340)

(130)

Income tax expense

(30)

(49)

(273)

(150)

Exploration²

(20)

(10)

(62)

(34)

Amortization of deferred financing costs and debt
premiums, net

(6)

3

(16)

8

Transaction and integration costs⁴

(5)

—

(157)

—

Deferred income tax expense (benefit)

(7)

76

224

145

Other, net

26

(7)

(18)

(12)

Net change in working capital

(61)

(53)

(210)

(15)

Net cash provided by operating activities (GAAP)

$              1,122

$                 505

$              2,865

$              1,559

Note: Prior year amounts may not calculate due to rounding.

¹ See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above.

² Stock-based compensation expense is a component of the exploration expense and general and administrative expense line items in the unaudited
condensed consolidated statements of operations. Therefore, the exploration line items shown in the reconciliation above will vary from the amounts
shown in the unaudited condensed consolidated statements of operations for the component of stock-based compensation expense recorded to
exploration expense.

³ For the three and nine months ended September 30, 2026, the stock-based compensation expense line item in the reconciliation above differs from
the amount shown in the unaudited condensed consolidated statements of cash flows because it excludes stock-based compensation expense
included within the transaction and integration costs line item above.

⁴ Transaction and integration costs include expenses associated with the Merger and post-Merger integration activities. For the three and nine
months ended September 30, 2026, these costs consisted of $4 million and $159 million, respectively, of one-time integration costs (including less
than $1 million and $20 million, respectively, of stock-based compensation), which were included in general and administrative expense in the
unaudited condensed consolidated statements of operations, and $1 million and $18 million, respectively, of one-time transaction costs included in
other operating expense in the unaudited condensed consolidated statements of operations.

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Reconciliation of Net Income to Adjusted Net Income¹

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

2026

2025

2026

2025

Net income (GAAP)

$                  93

$                155

$                829

$                539

Net derivative (gain) loss

684

(45)

1,109

(107)

Net derivative settlement gain (loss)

(207)

39

(457)

86

(Gain) loss on divestiture activity

2

—

(260)

—

Transaction and integration costs²

5

—

177

—

Other, net

(1)

5

12

6

Tax effect of adjustments³

(111)

—

(133)

3

Deferred tax remeasurement – corporate reorganization⁴

—

—

23

—

Adjusted net income (non-GAAP)

$                465

$                154

$             1,300

$                528

Diluted net income per common share (GAAP)

$               0.39

$               1.35

$               3.66

$               4.69

Net derivative (gain) loss

2.86

(0.39)

4.90

(0.93)

Net derivative settlement gain (loss)

(0.87)

0.34

(2.02)

0.75

(Gain) loss on divestiture activity

0.01

—

(1.15)

—

Transaction and integration costs²

0.02

—

0.78

—

Other, net

—

0.03

0.06

0.05

Tax effect of adjustments³

(0.46)

—

(0.59)

0.03

Deferred tax remeasurement – corporate reorganization⁴

—

—

0.10

—

Adjusted net income per diluted common share (non-GAAP)

$               1.95

$               1.33

$               5.74

$               4.59

Basic weighted-average common shares outstanding

237

115

225

115

Diluted weighted-average common shares outstanding

239

115

226

115

Note: Per common share amounts, and prior year amounts may not calculate due to rounding.

¹ See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above.

² Transaction and integration costs include expenses associated with the Merger and post-Merger integration activities. For the three and nine months ended
September 30, 2026, these costs consisted of $4 million and $159 million, respectively, of one-time integration costs (including less than $1 million and
$20 million, respectively, of stock-based compensation), which were included in general and administrative expense in the unaudited condensed consolidated
statements of operations, and $1 million and $18 million, respectively, of one-time transaction costs included in other operating expense in the unaudited
condensed consolidated statements of operations.

³ The tax effect of adjustments was calculated using a tax rate of 22.9% for the three and nine months ended September 30, 2026, and 22.1% for the three and
nine months ended September 30, 2025. These rates approximate the Company's statutory tax rates for the respective periods, as adjusted for ordinary
permanent differences.

⁴ Reflects a non-recurring remeasurement of net deferred tax balances resulting from a change in state income tax apportionment due to a corporate
reorganization and the Merger.

SM ENERGY COMPANY

FINANCIAL HIGHLIGHTS (UNAUDITED)

September 30, 2026

Reconciliation of Net Cash Provided by Operating Activities
and Capital Expenditures to Adjusted Free Cash Flow¹

(in millions)

For the Three Months Ended

September 30,

For the Nine Months Ended

September 30,

2026

2025

2026

2025

Net cash provided by operating activities (GAAP)

$            1,122

$               505

$            2,865

$            1,559

Net change in working capital, including change in certain long-
term items

22

53

155

15

Cash flow from operations before net change in working capital,
including change in certain long-term items (non-GAAP)

1,144

558

3,020

1,574

Capital expenditures (GAAP)

711

398

2,020

1,222

Changes in capital expenditure accruals

36

(74)

116

(70)

Capital expenditures before changes in accruals (non-GAAP)

747

323

2,136

1,152

Adjusted free cash flow (non-GAAP)

$               397

$               234

$               884

$               422

Note:  For the three months ended September 30, 2026, adjusted free cash flow includes approximately $5 million of one-time, non-recurring cash costs
associated with the Merger integration reported in net cash provided by operating activities. For the nine months ended September 30, 2026, adjusted free cash
flow includes approximately $227 million of one-time, non-recurring cash costs associated with the Merger integration and South Texas assets divested,
consisting of approximately $157 million reported in net cash provided by operating activities and approximately $70 million in capital expenditures.

¹ See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above.

Reconciliation of Total Principal Amount of Debt to Net Debt¹

(in millions)

September 30, 2026

Principal amount of Senior Notes²

$                                   6,456

Revolving credit facility²

—

Total principal amount of debt (GAAP)

6,456

Less: Cash and cash equivalents

442

Net Debt (non-GAAP)

$                                   6,014

¹ See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above.

² Amounts as of September 30, 2026, are from Note 6 - Long-Term Debt in Part I, Item 1 of the Company's Form 10-Q.