| Today’s Upstream Updates (details below)

• ConocoPhillips to Acquire Marathon Oil (Deal Overview Below)

• Oil prices gain on expectations of OPEC+ cuts

• Yesterday, Energy Transfer agreed to buy WTG

| Markets - Energy Prices

Note: pricing is as of time of publishing.

| ConocoPhillips to Acquire Marathon Oil

• All-stock transaction

• Total enterprise value of $22.5 billion

• COP to issue 0.2550 shares for each share of MRO

• 14.7% premium to the closing share price

• COP planning to increase base dividend by 34% to $0.78/share

• Repurchase $7 billion in shares in the first year

• Repurchase over $20 billion in shares in first three years

• Conference call today at 10am EDT (Link)

• Acquisition presentation (Link)

• Robust Implied Deal Multiples:

  • Implied production multiple ~$57,700/boe/d

  • Using MRO 2024E EBITDA guidance of $4.2 billion implies a cash flow multiple of 5.35x

Combined Key Asset Map

| Morning News - Energy

• Oil prices gains on expectations of OPEC+ cut extensions (Reuters)

• Energy Transfer to acquire WTG in $3.25 BN deal (Businesswire)

• Hess shareholders approve merger with Chevron (Hess Release)

• Vital Energy converts preferred equity into common shares (Release)

• Mexico’s demand for Permian gas likely here to stay (Hart Energy)

• Former Pioneer CEO urges FTC to withdraw ban (Reuters)

• JP Morgan looks worldwide at oil demand in May (Rigzone)

| Noteworthy from Energy X (Twitter)

• Not enough copper to meet global electrification (Link)

• Energy demand driven by hungry robots (Link)

• OPEC+ has tied itself in a knot (Link)

| Transactions - Monthly Upstream Deals

| Capital Markets - Energy Debt & Equity

• Debt 5/22/2024 - Cheniere Energy (LNG) completed a private placement of $1.2 BN senior secured notes. Notes carry an interest rate equal to 5.75% and mature in 2034 (Link).

• Debt 5/21/2024 - California Resources Corp (CRC) announced the pricing and upsized private offering of $600 MM in 8.25% senior unsecured notes due 2029. CRC estimates the net proceeds will be approximately $590 MM after purchaser’s discount and expenses indicating a 98% discount. New notes will be used to repay the existing indebtedness of Aera Energy, LLC in connection with the pending business combination (Link).

• Equity 5/15/24 - Civitas Resources (CIVI) announced a secondary public offering by an affiliate of Canada Pension Plan Investment Board (CPPIB). Offering is for 6,956,520 shares of common stock at a price to the public of $73.80 per share (~4% discount). CIVI will not receive any proceeds from the offering. Underwriters will offer the shares from time to time and have a 30-day option to purchase up to an additional 1,043,478 shares (Link).

• Equity 5/14/24 - Magnolia Oil & Gas (MGY) reported affiliates of EnerVest agreed to sell 12,000,000 shares of class A common stock in an unregistered secondary block trade. MGY did not sell any class A shares in the block trade nor received any proceeds. Additionally, MGY agreed to purchase from EnerVest 3,000,000 shares of class B common stock at a price per share equal to that received in the class A block trade. (Link)

• Equity 5/13/24 - Permian Resources (PR) announced the pricing of 51,765,000 shares of Class A common stock at a price of $16.47 per share for affiliates of EnCap, NGP, Pearl Energy and Riverstone. Offering is a secondary public offering with Permian Resources not receiving any proceed nor selling any shares. Concurrently with the closing, PR agreed to purchase from certain of the Selling Stockholders 1,800,000 common units representing limited liability company interests in Permian Resources Operating, LLC at the same prices as the secondary offering. (Link)

• Notes 4/16/24 - Sunoco LP (SUN) priced its private senior notes due 2029 offering at 100% or 7.00% for an aggregate principal amount of $750 million. Additionally, it priced senior notes due 2032 at 7.25% for an aggregate principal amount of $750 million. Notes were issued in part of the Sunoco and NuStar merger (Link)

• Notes 4/09/24 - Diamondback Energy, Inc (FANG) issues the following notes: (1) $850 MM senior note with a coupon of 5.20% due 2027 and priced at 99.956%, (2) $850 MM senior note with a coupon of 5.150% due 2030 and priced at 99.83%, (3) $1,300 MM senior note with a coupon of 5.40% due 2034 and priced at 99.679%, (4) $1,500 MM senior note with a coupon of 5.75% due 2054 and priced at 99.957%, (5) and $1,000 MM senior notes with a coupon of 5.90% due 2064 and priced at 99.954%. (Link)

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Disclaimer - The information provided in this newsletter is for informational purposes only and should not be construed as investment advice. The contents and references herein do not constitute a recommendation to buy, sell, or hold any securities. Readers are encouraged to conduct their own research and consult with a qualified financial advisor before making any investment decisions based on the information provided herein. The authors and publisher of this newsletter are not liable for any actions taken by readers based on the information contained here.