Scale Adds Strength and Flexibility

Financial Flexibility

  • Balanced midstream and downstream obligations allow for the opportunity to¬†dynamically manage assets to maximize returns
  • No near term debt maturities; $510 million of high yield notes mature in 2023
  • No long term service or rig contracts
  • Net debt to LTM EBITDAX of approximately 2.0x
  • Per unit G&A tops among Appalachian peers
  • Potential of free cash flow generation provides opportunity to reduce interest expense, lower debt outstanding, or return capital to shareholders¬†while maintaining moderate growth

Commodity Optionality

  • Approximately 104,000 acres or 46% of the companies acreage has liquids exposure providing the added benefit of commodity price diversification
  • Production growth drives compounding exposure to improving liquids pricing

Operational Adaptability

  • Minimal drilling commitments and production in excess of downstream commitments provides flexibility to ramp up or down in dependent upon the commodity price environment
  • Business plan with approximately 2 rigs achieves double digit YoY production growth in 2019
  • Reduced cycle times and optimized well pad capital spend provides attractive return on
    investment
  • Repeatable well designs limit need for additional contract labor and specialized tools

*based upon Montage internal forecasts and estimates