Chord Energy Corp Q4 FY2025 earnings call

• 2025 was a remarkable year with continuous business improvement, including evolving the development program, driving efficiencies, and enhancing free cash flow. • Exceeded expectations in results, improving inventory quality/depth and profit margins. • Since 2021, returned a significant amount to shareholders. • Fourth quarter 2025 had solid operating performance with loyal volumes and capital within guidance ranges and strong cost control. • Achieved converting 80% of inventory to long laterals by year-end 2025 earlier than expected. • Operational improvements and longer laterals lowered cost of supply. • 2026 plan aligns with previous outlook, expecting specific oil volumes, capital, and free cash flow at benchmark prices.

In 2025, Cord saw exceptional results. Oil volumes exceeded original guidance by over 1,000 barrels per day, and capital was around $60 million lower. Since combining with Interplus in 2024, capital spending dropped nearly $100 million while oil production increased by 6,000 barrels per day in 2026. In 2025, Cord achieved a $160 million improvement in free cash flow from controllable items like higher production, lower capital, etc. For the fourth quarter, loyal volumes were at the high end of guidance, capital was below the low end of guidance, and adjusted free cash flow was $175 million. Since 2021, Cord has returned $6.7 billion to shareholders.

• 2026 plan follows November preliminary outlook, expecting average oil volumes of 157,000 - 161,000 barrels per day and capital expenditure of $1.4 billion. • At benchmark prices of $64 per barrel of oil and $3.75 per MMBTU of natural gas, Cord anticipates generating approximately $700 million of free cash flow in 2026. • Currently, five rigs, one full-time frack crew, and one spot crew are in operation, with the spot crew scheduled to be phased out around the end of summer. Approximately 80% of TILs are expected to be longer laterals, evenly split between three- and four-mile wells.

• Forward - looking statements are subject to risks and uncertainties that could cause actual results to differ materially from disclosed ones. • Risks are detailed in earnings releases and SEC filings like Form 10 - K and Form 10 - Q. • No obligation to update forward - looking statements.

Q: Neil Dingman of William Blair inquired about the long - term plan and potential changes.

A: Danny stated the company is resilient and can withstand commodity price cycles. If oil prices dropped significantly, the plan might be re - evaluated, but currently, the company is satisfied with the plan.

Q: Neil also asked about fixed costs and reducing break - evens.

A: There's an organization - wide effort to lower the cost structure, including capital efficiency, operating expense improvements, and marketing/midstream efforts. The move to longer laterals improved F&D, and there was a $160 million free cash flow improvement in 2025 from multiple initiatives.

Q: Oliver Huang of TPH asked about organic inventory and GOR trends.

A: Organic inventory has improved across the basin. The 2026 program has more focus on the western side with lower GOR. GORs in the core basin are expected to increase, but new production will have a lower GOR.

Q: Derek Whitfield of Texas Capital asked about business improvement leverage and surfactant use.

A: There are opportunities across all buckets on slide eight. The COO mentioned 19 chemical and surfactant treatments have been pumped, results are being evaluated, and adding to completions is being studied.

Q: Paul Diamond of Citi asked about marketing/midstream savings and 2026 locations.

A: The marketing/midstream team did well with new contracts at lower costs. M&A is done in a disciplined manner, picking appropriate spots.

Q: Noah Hungness of Bank of America asked about 2026 decline rate and winter storm impact.

A: The 2026 decline rate is similar to 2025 on an annual basis. Winter storm impacted 1Q activity but the overall capital spend pattern remains similar to expectations.

Q: Carlos Escalante of Wolf Research asked about longer laterals' impact on 2027 and basin optionality.

A: Longer laterals provide tailwinds for 2027. The basin has great inventory with conservative spacing and repeatable development.

Q: Nicholas Pope of Roth Capital asked about water disposal optimization.

A: Midstream deals and moving to areas with lower gas lead to slightly higher water, so some capital is spent on the water side to boost E&P returns.

Q: Noel Parks of Tuohy Brothers asked about lateral length extensions in reserves and infill drilling.

A: 2025 reserves captured three - mile well results, and four - mile wells are in the early stage. Longer laterals and alternative shape wells have implications for infill drilling, a potential incremental opportunity.