Oil and Gas Advisory | Capex Cut Tracker General Overview

The Duff & Phelps Capex Cut Tracker Oil Prices (2020 YTD)

80 . Since the start of 2020, global economic sentiment has 60 increasingly been dominated by the impact of COVID-19 40 pandemic on GDP growth rates (global downward revision 20 WTI to -3.0%; U.S., China and Eurozone downward to -5.9%, 0 Brent +1.6% and -7.5% respectively), global equities, production -20 Dubai indices, interest rates and global oil demand. -40 . The global oil and gas industry has not only been hit -60 heavily due to the temporary contraction in global demand caused by COVID-19, but also by record output levels from OPEC and non-OPEC producers and their inability to react in a timely matter to a global oversupply of crude oil Select Global Equities Performance (2020 YTD) and lack of available storage capacity. . Even though production-cut agreements have been 20% 0% reached, they are far from required cutbacks, and prices S&P 500 -20% are still hovering around all-time lows. This has especially S&P E&P -40% affected Exploration and Production (E&P) companies, MSCI E. M. -60% that rushed to cut spending forecasts for 2020 and 2021 MSCI China on a record scale. -80% MSCI Eur. . The response to revise 2020 and 2021 spending guidance -100% DJI has led companies to focus on de-risking portfolios and -120% creating more cost-efficient structures. This has resulted in companies cutting capital expenditures by double digits and cancelling and delaying projects to center efforts on CAPEX Index highly profitable projects. . Many companies have repeatedly cut forecasts since 14% Consensus Estimate Forecast March 2020, reacting to record-level price volatility. To 12% provide a comprehensive and timely update on the 10% industry's actions, Duff & Phelps provides a bi-weekly 8% North America update to its Capex Cut Tracker which analyzes 6% announced spending cuts for North Amercia-focused, Majors & IOCs 4% international and national oil companies. 2%

0% 2018 2019 2020 2021 2022

Source: CapitalIQ, Bloomberg, company filings and press releases, and Duff & Phelps analysis Last Updated: May 18, 2020

DUFF & PHELPS 1 Capex Cut Tracker North America-Focused

North America (NA) Capital Expenditures Overall NA Capex Avg. Capex Revisions per (million USD) Cuts Company

-1,083 CANADIAN NATURAL RES. 3,050 2,720 -1,096 CONCHO RESOURCES 2,803 -48% 3,240 (2020 vs 2020 Announced Cash -1,702 Revised) CONTINENTAL RESOURCES 2,822 Distribution Cutbacks 2,861 Dividend Dividend Buyback -811 cuts suspensions on hold 1,820 2020R 2020 2019 1,959 -1,254 2 2 1 DIAMONDBACK ENERGY 2,924 3,667 -3,140 NA CAPEX Index EOG RESOURCES 6,812 6,423 14% -1,124 2,447 12% 2,619 -1,095 10% NOBLE ENERGY 2,015 2,524 8% -3,443 OXY 5,976 6% 6,355 -1,622 4% PIONEER NATURAL RES. 3,291 3,220 2% 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 0% 2020 Revised Change 2020 2019 2018 2019 2020 2021 2022

Source: CapitalIQ, Bloomberg, company filings and press releases, and Duff & Phelps analysis Last Updated: May 18, 2020

DUFF & PHELPS 2 Capex Cut Tracker International Oil Companies and Majors

International Oil Companies (IOC) and Majors Capital Expenditures Overall IOC and Avg. Capex Revisions per (million USD) Majors Capex Cuts Company

-1,023 APACHE 2,139 2,961 -4,380 BP 16,792 15,418 -27% (2020 vs 2020 -4,001 Announced Cash Revised) CHEVRON 14,416 Distribution Cutbacks 14,116 Dividend Dividend Buyback -2,230 cuts suspensions on hold CONOCOPHILLIPS 6,570 2020R 2020 2019 6,636 -2,198 3 - 7 8,599 9,032 -2,262 IOC CAPEX Index 11,424 10,203 9%

-9,930 8% EXXON MOBIL 28,626 24,361 7% -793 6% 3,552 3,600 5% -5,189 SHELL 25,771 4%

22,970 3% -4,015 TOTAL 15,695 2% 11,810 1% 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 0% 2020 Revised Change 2020 2019 2018 2019 2020 2021 2022

Source: CapitalIQ, Bloomberg, company filings and press releases, and Duff & Phelps analysis Last Updated: May 18, 2020

DUFF & PHELPS 3 Capex Cut Tracker National Oil Companies

National Oil Companies (NOC) Capital Expenditures Overall NOC Capex Avg. Capex Revisions per (million USD) Cuts Company

-10,000 37,500 32,760 -13,300 PETROCHINA 41,300 46,072 -23% -4,000 (2020 vs 2020 Announced Cash Revised) 5,250 Distribution Cutbacks 4,157 Dividend Dividend Buyback -0 cuts suspensions on hold 18,000 2020R 2020 2019 27,480 -1,600 - 2 - PEMEX 16,700 5,835 -3,500 NOC CAPEX Index 12,000 8,529 90%

-0 80% 6,210 10,923 70% -807 60% PTT E&P 4,613 4,776 50% Not sufficient and/or timely -2,111 information available 12,291 40%

13,204 30% -4,547 20,210 20% 20,305 10% 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 0% 2020 Revised Change 2020 2019 2018 2019 2020 2021 2022

Source: CapitalIQ, Bloomberg, company filings and press releases, and Duff & Phelps analysis Last Updated: May 18, 2020

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