(Exact name of Registrant as specified in its charter) | ||||
Not Applicable | ||||
(Translation of Registrant’s name into English) | (Jurisdiction of incorporation or organization) | |||
Diversified Energy Company PLC Tel: +1 | ||||
(Address of principal executive offices) | (Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
London Stock Exchange |
¨ Large accelerated filer | ¨ Accelerated filer | þ |
¨ U.S. GAAP | þ | ¨ Other |
Our Core Values We CARE for each other, our communities, our industry and our country! |
COMMITMENT —Seek opportunities for continuous learning and improvement. —Serve and support our teams and communities with passion and enthusiasm. ACCOUNTABILITY —Act with personal and business integrity. RESPECT —Value the dignity and worth of all individuals. —Respect environmental stewardship as we make business decisions. EXCELLENCE —Commit to excellence in our performance. —Exhibit courage of convictions, challenge the status quo and strive to create value. |
Report of Independent Registered Public Accounting Firm | ||
Additional Information (Unaudited) | ||
Accretive Growth Investment in the Tanos II Central Region acquisition totaled $262 million and bolstered average daily production by 8%. | Asset Monetization Unlocked value on non-core assets through the sale of undeveloped acreage and non-operated well interests for total consideration of $66 million. | U.S. Listing Commenced trading on the New York Stock Exchange under the “DEC” ticker in December 2023, expanding access to U.S. investors and improving trading liquidity. | ||
Prioritizing Sustainability Realized 33% year-over-year reduction in Scope 1 methane intensity, achieving our 2030 goal of cumulative 50% reduction in Scope 1 methane intensity (from 2020 baseline) and driven largely by our focused and continual emissions detection, measurement and mitigation programs in both our Appalachia and Central regions. | Financing Executed the sale of certain producing assets in Appalachia to a special purpose vehicle “SPV”, generating proceeds of approximately $192 million through placement of an asset-backed securitization at the SPV, including the sale of an 80% equity interest in the SPV for $30 million. | Delivering Shareholder Value Share buybacks and distributed dividends represent $179 million in return of capital to shareholders. | ||
Pages | ||||
Part I | ||||
Item 1. | Identity of Directors, Senior Management and Advisers | N/A | ||
Item 2. | Offer Statistics and Expected Timetable | N/A | ||
Item 3. | Key Information | |||
A. | [Reserved] | |||
B. | Capitalization and indebtedness | N/A | ||
C. | Reasons for the offer and use of proceeds | N/A | ||
D. | Risk factors | |||
Item 4. | Information on the Group | |||
A. | History and development of the Group | |||
B. | Business overview | |||
C. | Organizational structure | 181, Exhibit 8.1 | ||
D. | Property, plants and equipment | |||
Item 4A. | Unresolved Staff Comments | N/A | ||
Item 5. | Operating and Financial Review and Prospects | |||
A. | Operating results | |||
B. | Liquidity and capital resources | |||
C. | Research and development, patents and licenses, etc. | N/A | ||
D. | Trend information | |||
E. | Critical accounting estimates | |||
Item 6. | Directors, Senior Management and Employees | |||
A. | Directors and senior management | |||
B. | Compensation | |||
C. | Board practices | |||
D. | Employees | |||
E. | Share ownership | |||
F. | Disclosure of a registrant’s action to recover erroneously awarded compensation | N/A | ||
Item 7. | Major Shareholders and Related Party Transactions | |||
A. | Major shareholders | |||
B. | Related party transactions | |||
C. | Interests of experts and counsel | N/A | ||
Item 8. | Financial Information | |||
A. | Consolidated Statements and Other Financial Information | |||
B. | Significant Changes | N/A | ||
Item 9. | The Offer and Listing | |||
A. | Offer and listing details | |||
B. | Plan of distribution | N/A | ||
C. | Markets | |||
D. | Selling shareholders | N/A | ||
E. | Dilution | N/A | ||
F. | Expenses of the issue | N/A |
Pages | ||||
Item 10. | Additional Information | |||
A. | Share capital | N/A | ||
B. | Memorandum and articles of association | |||
C. | Material contracts | |||
D. | Exchange controls | |||
E. | Taxation | |||
F. | Dividends and paying agents | N/A | ||
G. | Statement by experts | N/A | ||
H. | Documents on display | |||
I. | Subsidiary information | N/A | ||
J. | Annual report to security holders | N/A | ||
Item 11. | Quantitative and Qualitative Disclosures About Market Risk | |||
Item 12. | Description of Securities Other than Equity Securities | |||
A. | Debt securities | N/A | ||
B. | Warrants and rights | N/A | ||
C. | Other securities | N/A | ||
D. | American depositary shares | N/A | ||
Part II | ||||
Item 13. | Defaults, Dividend Arrearages and Delinquencies | N/A | ||
Item 14. | Material Modifications to the Rights of Security Holders and Use of Proceeds | N/A | ||
Item 15. | Controls and Procedures | |||
Item 16. | [Reserved] | N/A | ||
Item 16A. | Audit Committee Financial Expert | |||
Item 16B. | Code of Ethics | |||
Item 16C. | Principal Accountant Fees and Services | |||
Item 16D. | Exemptions from the Listing Standards for Audit Committees | N/A | ||
Item 16E. | Purchases of Equity Securities by the Issuer and Affiliated Purchasers | N/A | ||
Item 16F. | Change in Registrant’s Certifying Accountant | N/A | ||
Item 16G. | Corporate Governance | N/A | ||
Item 16H. | Mine Safety Disclosure | N/A | ||
Item 16I. | Disclosure Regarding Foreign Jurisdictions that Prevent Inspections | N/A | ||
Item 16J. | Insider Trading Policies | N/A | ||
Item 16K. | Cybersecurity | |||
Part III | ||||
Item 17. | Financial Statements | N/A | ||
Item 18. | Financial Statements | |||
Item 19. | Exhibits |
PRODUCTION MIX 86% natural gas 12% NGLs 2% oil | PRODUCTION 256,378 natural gas (MMcf) 5,832 NGLs (MBbls) 1,377 oil (MBbls) | PV-10 VALUE OF RESERVES $2.1 billion(a) 3,849,946 MMcfe | MIDSTREAM SYSTEM ~17,700 miles |
SCOPE 1 METHANE EMISSIONS INTENSITY 0.8 MT CO2e/MMcfe | NO LEAK RATE ON SURVEYED WELLS ~98% Group-wide | AERIALLY SURVEYED MIDSTREAM MILES ~10,000 miles | REPORTABLE SPILL INTENSITY 0.08 oil & water per MBbl |
NET INCOME $760 million | TOTAL REVENUE $868 million | ADJUSTED EBITDA MARGIN(b) 52% | ADJUSTED EBITDA(b) $543 million |
(a)Based on SEC pricing. (b)Please refer to the APMs section in Additional Information within this Annual Report & Form 20-F for information on how these metrics are calculated and reconciled to IFRS measures. |
On behalf of the Board of Directors, I am pleased to share our financial and operational results that reflect the hard work, dedication, and focus of the entire Diversified team. Their consistent execution of our strategy and management initiatives has driven another year of strong environmental, financial, and operational performance. Throughout 2023, we continued to focus on cash flow generation, capital discipline, and balance sheet management. This, together with our resilient business model, means we have been able to deliver strong results which have benefited all stakeholders. In addition, we are proud of the part we are playing in responsibly providing the energy needed for our communities and country, as well as meeting growing demand beyond the U.S. Since 2017, Diversified’s demonstrated track record has delivered more than $800 million in returns to the Group’s stockholders including approximately $700 million in cash dividends paid and declared, along with approximately $110 million in share repurchases. The Board’s dedication to shareholder returns remains an absolute priority. We continuously refine the capital allocation framework in order to balance debt reduction, sustainable fixed dividends, strategic share repurchases and accretive acquisitions. We are proposing a final fourth quarter 2023 dividend of $0.29 which allows us to focus our cash flows on what we believe are the highest and best uses of capital. We are confident that this new level will be sustainable, and will also allow for continued debt reduction, more flexibility for alternative capital returns, and for funding future growth. We believe that our share price has been significantly undervalued for some while and has been affected by the structural de- equitization of the UK share market. We have, therefore, also authorized a share buyback program, which we believe will be an effective use of our capital and will further increase total shareholder returns. Part of our business model and strategy revolves around the continued addition of growth opportunities. We identified a listing on the New York Stock Exchange, in addition to the London listing, as an opportunity that could help to add significant value and were pleased to deliver on that key milestone this year. We view the NYSE listing as a great opportunity to expand access to U.S. investors and improve trading liquidity. We continue to evaluate opportunities to grow and to increasingly make Diversified the “Right Company at the Right Time.” | Another important part of our focused strategy is to create value through sustainability and stewardship. Over the past year, we have made significant progress with our methane emissions program, reducing emissions by over 33% from 2022 and achieving our 2030 goal meaningfully ahead of schedule. We are proud that we received recognition from the United Nations’ Oil & Gas Methane Partnership 2.0 (OGMP), being awarded the Gold rating for the second year. Our initiatives related to methane emission reductions are of paramount importance, and it gives us great confidence to see this recognized by international bodies. Operationally, we conducted over 246,000 leak detection surveys using industry-leading and proven detection equipment, and attaining a zero emissions rate of approximately 98%, proving the positive impact of our actions to eliminate methane leaks. Next LVL Energy, our asset retirement business, has continued to grow and contribute significantly to safe and efficient well retirements, retiring a total of 404 wells. This achievement included retiring a total of 222 Diversified wells in 2023, significantly exceeding state agreements. Additionally, our partnership with states on their orphan well programs resulted in 148 retired wells. We are immensely proud of the material investments we have made to lower our methane intensity, and to safely retire wells, and we remain focused on delivering continuous improvement. The Board and its Committees continue to operate effectively and are active in both supporting and challenging strategic discussions. There is an exceptional depth of knowledge and diversity of thinking. We again conducted a Board Performance Review during 2023 and will continue to ensure that we comply with all governance guidelines. As we look ahead to 2024 and beyond, I would like to recognize the quality of the team we have at Diversified, across the entire Group. I am very grateful for their work and look forward to future successes as a company in the years to come. In particular, I would like to thank the Executive Team, led by Rusty Hutson, Jr., who navigated the team through a year that has seen its share of broader challenges, notably an unfavorable commodity price environment. I also wish to express gratitude to our shareholders, lenders, and other stakeholders for their trust in our commitment to deliver long-term sustainable value and their support whilst we provide essential energy security and continue to care for our communities. ![]() David E. Johnson Chairman of the Board March 19, 2024 |
The fundamental need for natural gas is well- cemented in our domestic and global energy outlooks. Natural gas is the essential fuel to tackling global challenges – from enhancing energy security of the United States and allies around the world to addressing the universally shared need for reliable, affordable, and sustainable power, natural gas demand remains strong. It’s against this backdrop of rising global energy demand, consolidation in the U.S. energy markets, and enhanced expectations for sustainably produced energy that the case for Diversified’s stewardship business model sharpens. Thanks to our approach – focused on acquiring, improving, and retiring existing, long-life U.S. energy assets and honed through two decades of field experience – Diversified is the “Right Company at the Right Time” to responsibly manage existing domestic natural gas and oil production in a manner that’s consistent with environmental stewardship and a lower-carbon energy future. We continue to aggressively pursue this mission each and every day, and 2023 was no different. From closing the Tanos II acquisition – which increased our footprint in the Central Region and aligned with our stewardship and sustainability commitments – to ending the year with dual-listing on the New York Stock Exchange, 2023 was a year focused on execution against our core business objectives. Through our focused commitment to responsible asset management, we continue to drive methane intensities downward, while returning wells to production and gaining operational efficiencies. Compared to a 2020 baseline, upstream methane intensity has fallen over 50%, achieving our 2030 goal meaningfully ahead of schedule, and we are continuing to take aggressive steps to optimize environmental performance across our operating areas. By viewing asset retirement as a business opportunity, Diversified’s Next LVL Energy subsidiary is the largest well retirement company in Appalachia. Our focus on asset retirement stands out, with our dedicated teams responsibly retiring 404 wells in 2023 alone, as no other company is addressing state orphaned and end-of-life wells head-on like we are. This focus on sustainability principles has been validated on the domestic and global stage, with sustained Gold standard designations from the United Nation’s Oil and Gas Methane Partnership 2.0 (second year), attainment of the second- highest MSCI ESG “AA” rating, and multiple sustainability awards, to name a few. Last year’s sustainability report detailing our proactive approach took home the ESG Report of the Year by the international ESG Awards 2023 for speaking to “both head and heart,” while also receiving the top category nomination from IR Magazine. I am proud to see the hard work of our employees recognized as industry leaders time and again. We also continue to expand Diversified’s community-giving culture in the communities where we live and work, and we’re privileged to strengthen our corporate commitments to employees. We fully recognize none of this progress would be possible without our 1,600+ diligent team who work every day to ensure families across the United States have safe, clean, and reliable energy resources. | In the year ahead, we are taking a renewed focus on the values on which Diversified was founded: investing in strategic, aligned acquisitions that scale our model and deliver greater operational efficiencies, taking proactive steps to ensure the sustainability of assets, keeping costs low and de- leveraging the balance sheet – all while returning value to shareholders. Diversified has set in motion its “Focus Five” in order to demonstrate meaningful expansion of free cash flow generation while growing the company in a disciplined manner. That plan consists of the following core objectives: —Optimized cash flow generation —Cost structure optimization —Financial and operational flexibility —Sustainability innovation —Scale through accretive growth I believe these principles will help differentiate the Company among its peers in unlocking corporate value throughout 2024 and into the future. The Company has undertaken a reassessment of its capital allocation strategy to weigh the intrinsic value of the current share price level against the historical practice of returning capital through dividends. The Board and executive management team have jointly evaluated a number of potential scenarios to align the dividend level with expected future capital allocation needs, peer trends, current commodity prices and current equity market dynamics. The result of this assessment is the Board’s realignment of capital allocation and is designed to best position the Company to create long-term shareholder value through the proper combination of: —Systematic debt reduction —Fixed per-share dividend —Strategic share repurchases —Accretive strategic acquisitions We are proud to be part of the solution to the broader challenge of existing energy infrastructure and to do our part in driving our country’s energy, climate, and economic security – and we couldn’t do it without our OneDEC team. ![]() Robert R. (“Rusty”) Hutson, Jr. Chief Executive Officer March 19, 2024 |
1 | ![]() | ACQUIRE | |
We maintain a disciplined approach to evaluating opportunities to ensure that we only pursue those that possess a consistent asset profile. We target existing long-life, stable assets with synergistic opportunities that produce predictable and stable cash flows, are value accretive, margin enhancing and strategically complementary. | |||
2 | ![]() | OPTIMIZE | |
The primarily mature nature of the assets we acquire provides us with a portfolio of low-cost optimization opportunities. These optimization activities, applied through our internally developed SAM program, are strategically important as they aid in offsetting natural production declines, creating expense efficiency and reducing our emissions. | |||
3 | ![]() | PRODUCE | |
Our culture makes the difference as our team of industry veterans strive to efficiently produce as many units as possible in a safe and environmentally responsible manner, aligning both environmental and financial best interests. | |||
4 | ![]() | TRANSPORT | |
We seek to acquire midstream systems into which we are a large producer and more fully integrate those assets into our upstream portfolio to provide immediate and long-term synergies. | |||
5 | ![]() | RETIRE | |
We embrace our commitment to be a responsible operator of existing assets. With safety and environmental stewardship as top priorities, we design our asset retirement program to permanently retire wells that have reached the end of their producing lives. During 2022, we made investments that allowed us to meaningfully expand our asset retirement capabilities through a series of acquisitions that we believe have provided us with the operational capacity to be a leader in asset retirement. |
DAILY OPERATING PRIORITIES | |
Safety | |
No compromises. Ensuring the care and well-being of our employees, our families, our partners and communities is our top priority. | ![]() |
Production | |
Every unit counts. Ensuring that every unit we safely produce provides affordable and reliable energy to our communities and generates value for our shareholders. | ![]() |
Efficiency | |
Every dollar counts. Ensuring every dollar we spend protects our employees and communities and grows the investment of our shareholders. | ![]() |
Enjoyment | |
Have fun delivering great results. Ensuring our company is an attractive place to work, encouraging innovation and celebrating our employees’ accomplishments. | ![]() |
STRATEGY | |
Acquire long-life stable assets | ![]() |
Operate our assets in a safe, efficient and responsible manner | ![]() |
Generate reliable free cash flow | ![]() |
Retire assets safely and responsibly | ![]() |
![]() | ![]() | ||
Priorities | Strategy | Sustainability | Risk |
see page 7 | see page 11 | see page 33 | see page 79 |
Our business model and the corporate culture we cultivate is unique among the natural gas and oil industry in that we do not engage in capital-intensive drilling and development. Rather, our stewardship model focuses on acquiring existing long-life, low-decline producing wells and, at times, their associated midstream assets, and then efficiently managing the assets to improve or restore production, reduce unit operating costs, reduce emissions and generate consistent free cash flow before safely and permanently retiring those assets at the end of their useful lives. | |||
![]() |
Execute Commodity Hedges to Secure Healthy Margins |
Protect our ability to provide durable shareholder returns |
Generate Reliable Free Cash Flow |
Maintain adjusted EBITDA margins, low capital intensity and low LOE per unit |
Provide Durable Shareholder Returns |
Create value for our shareholders via debt reduction, fixed dividends, strategic share repurchases and accretive acquisitions |
Maintain A Healthy Balance Sheet |
Maintain low leverage, ample liquidity and access to additional capital for opportunistic growth |
U.S. DRY SHALE GAS PRODUCTION billion cubic feet per day | |
![]() | |
Sources: Graph by the U.S. Energy Information Administration (“EIA”) based on state administrative data collected by Enverus. Data are through December 2023. The EIA updated the factors it uses to convert gross natural gas to dry natural gas based on the latest data. The update affected historical production volumes from some formations. State abbreviations indicate primary state(s). | ![]() |
![]() | Current play - oldest play | |
![]() | Current play - intermedia depth/age play | |
![]() | Current play - shallowest/youngest play | |
![]() | Prospective play | |
![]() | Basin | |
Strategy Our rapid growth and ability to generate consistent shareholder return stems from our unique business model and successful execution of straight-forward, low-risk, disciplined and proven operating techniques. | ![]() |
![]() | ACQUIRE Acquire long-life stable assets We practice a disciplined approach to acquire long-life stable assets by targeting low-decline producing assets that are value accretive, high margin and strategically complementary, while also applying extensive environmental, social, land and legal due diligence. | ![]() | OPERATE Operate our assets in a safe, efficient and responsible manner Our operational strategy and success is closely aligned with the culture we created through our four guiding operational priorities: Safety, Production, Efficiency and Enjoyment. These four daily priorities are brought to life as part of our SAM program which our team lives and breathes every day as they work to safely deliver clean, affordable and reliable energy. | ||
![]() | GENERATE Generate reliable free cash flow Our unique business model, coupled with the successful execution of the Acquire and Operate pillars of our corporate strategy, naturally lends itself to generating free cash flow. We aspire to make cash flows predictable and reliable so we can consistently generate shareholder return, pay down debt, fund acquisitive growth, and accomplish our sustainability goals and ambitions. | ![]() | RETIRE Retire assets safely and responsibly At the appropriate time, through our safe and systematic asset retirement program, we safely and permanently retire wells and responsibly restore the well sites as close as possible to their original and natural condition. Our asset retirement program reflects our solid commitment to a healthy environment, the surrounding community and its citizens and state regulatory authorities. |
![]() | Acquire Long-Life Stable Assets | ||
ONE DEC Foster a culture of operational excellence through the integration of People, Process and Systems | 2023 ACHIEVEMENTS —Completed the Tanos II Central Region acquisition for $262 million, contributing approximately 69 MMcfepd to 2023 production. —Realized first full year of operations for Next LVL Energy. — Utilized environmental and climate screening of ![]() target assets to inform acquisition considerations. TARGETS FOR 2024 — We will persist in our disciplined approach to ![]() acquisitions, focusing on producing assets that align with our stringent investment criteria. —We will maintain liquidity discipline, ensuring we remain well-positioned in the market to seize opportunities as they arise. —Our growth strategy will continue to emphasize complementary and synergistic expansion in the Appalachian and Central regions. We will foster strong relationships with development-oriented producers in our operating areas. —We will actively screen and execute on new basin opportunities, staying agile and responsive to emerging prospects. | ||
![]() | |||
ACQUIRE Target low-decline, producing assets that complement our returns-focused strategy | |||
INTEGRATE Onboard employees, integrate processes and systems to drive efficiencies and standardization | |||
OPTIMIZE Empower retained personnel to apply our SAM techniques on acquired assets | |||
CONSOLIDATE Enhance operating, marketing relationships with increasing scale | |||
PRINCIPAL RISKS —Corporate Strategy and Acquisition Risk —Financial Strength and Flexibility Risk —Climate Risk | KEY PERFORMANCE INDICATORS —Maintain net debt-to-adjusted EBITDA at or below 2.5x —Emissions intensity —Adjusted operating cost per Mcfe |
![]() | Operate our Assets in a Safe, Efficient and Responsible Manner | ||
GOAL Improve safety, optimize production, increase expense efficiency and improve emissions profile | 2023 ACHIEVEMENTS —Annual production of 299,632 MMcfe. —Adjusted EBITDA margin of 52%. — Achieved 2023 goal to conduct fugitive emission ![]() surveys on 100% of Central Region upstream assets. — Collectively, conducted ~246,000 voluntary ![]() fugitive emission detection surveys within our upstream portfolio, confirming an average ~98% no- leak rate on surveyed sites and allowing us to take meaningful steps towards reducing our emissions profile. — Completed aerial light detection and ranging ![]() (“LiDAR”) surveys covering~10,000 miles of midstream systems which also included ~9,000 sites (wells, compressor stations and other facilities). — Zero non-compliance issues cited after ![]() participating in 16 state and federal regulatory agency audits of our operational assets and compliance programs which were completed as part of routine monitoring programs. — Our safety-no compromises culture contributed to ![]() our preventable motor vehicle accident rate (“MVA”) declining 20% year-over-year to 0.55 (accidents to million miles driven). — Expanding continuous remote monitoring ![]() capabilities through our Gas Control and Integrated Operations Centers promotes safety and efficiency through enhanced visibility of operations. TARGETS FOR 2024 —We will continue to execute our guiding priorities: Safety, Production, Efficiency, and Enjoyment. — Our commitment to responsible stewardship ![]() remains unwavering. We will intensely focus on continuous improvement across all sustainability aspects, aiming to exceed our stakeholders’ expectations. —We will maintain our focus on the SAM program to uphold margins, offset natural declines, and capitalize on expense efficiency opportunities. | ||
PROCESS “Data + Human Interaction” coupled with production technology systems, drive activities, process enhancements, refine best practice techniques | |||
RESULT Practical, profit-focused SOLUTIONS developed by our experienced teams | |||
ONGOING INITIATIVES | |||
![]() | |||
PRINCIPAL RISKS —Corporate Strategy and Acquisition Risk —Climate Risk —Cybersecurity Risk —Health and Safety Risk —Regulatory and Political Risk —Financial Strength and Flexibility Risk | KEY PERFORMANCE INDICATORS —Safety Performance —Emissions intensity —Consistent adjusted EBITDA margin —Adjusted operating cost per Mcfe —Net cash provided by operating activities |
![]() | Generate Reliable Free Cash Flow | |||
PRUDENT ALLOCATION OF CASH FLOW | 2023 ACHIEVEMENTS —Raised our weighted average hedge floor on natural gas production to $3.87 per Mcf at December 31, 2023 from $3.63 per Mcf at December 31, 2022. —Repaid $277 million in asset backed securitizations illustrating the substantial cash flow generated by our assets. —Repurchased 646,762 shares through our Share Buyback Program, representing $11 million in shareholder value above and beyond the $168 million in dividend distributions. — Delivered on our sustainability investment ![]() commitment to convert additional natural gas pneumatic devices to compressed air, converting 58 well pads exceeding our goal to convert 30 well pads. We also had significant success with our upstream emissions detection surveys, completed year two of aerial surveillance activities for our midstream assets, and contributed to tree planting and land preservation initiatives primarily with West Virginia State University. TARGETS FOR 2024 —We will maintain our effective hedging strategy to insulate cash flows. Additionally, we’ll make the most of accretive market opportunities to raise our hedge book floor. — Our focus remains on securing low-cost ![]() sustainability-linked financing. This will support our acquisitive growth while ensuring low leverage and ample liquidity. — We will continue to invest in sustainability ![]() initiatives, reinforcing our commitment to responsible practices. | |||
Allocating Cash Flow | ||||
![]() | ||||
![]() | Debt Repayment Reduce outstanding debt & create liquidity | |||
![]() | Reinvestment & Growth Reinvest for organic growth & reduce reliance on equity and debt markets | |||
![]() | Sustainability Invest in broad spectrum of sustainability initiatives | |||
![]() | Dividend Distributions Pay sustainable dividends | |||
![]() | Share Buyback Program Reduce outstanding shares & increase shareholder value | |||
PRINCIPAL RISKS —Corporate Strategy and Acquisition Risk —Commodity Price Volatility Risk —Financial Strength and Flexibility Risk | KEY PERFORMANCE INDICATORS —Maintain net debt-to-adjusted EBITDA at or below 2.5x —Consistent adjusted EBITDA margin —Emissions intensity —Adjusted operating cost per Mcfe —Net cash provided by operating activities |
![]() | Retire Assets Safely and Responsibly and Restore the Environment to its Natural State | |||
![]() | STEP 1 DEACTIVATION Remove product from production equipment. | 2023 ACHIEVEMENTS — We expanded our asset retirement operations from 15 to ![]() 17 rigs. — We successfully retired 222 DEC wells, including 21 Central ![]() Region wells. This achievement surpasses our goal of retiring 200 wells by 2023 and also exceeds our collective state commitments in Appalachia to retire 80 wells in our primary states of operation. — We further retired 182 third-party wells, including 148 ![]() state and federal orphan wells and 34 for other third party operators, bringing the total wells retired in Appalachia by the Next LVL team to 383 wells. — We permanently retired 18 wells on lands managed by the ![]() Pennsylvania Game Commission. We then restored well sites to their natural condition by planting native trees to the region. This dual effort not only reduced noise pollution but also contributed to the restoration of bird habitats. TARGETS FOR 2024 — Continue to safely retire wells and aim to exceed state ![]() asset retirement programme commitments by identifying and retiring wells at the end of their productive lives. — Continue to optimize the vertical integration benefits ![]() we can realize with our expanded internal asset retirement capacity. — Continue constructive and collaborative dialogue with ![]() states and industry associations to innovate and ensure best practices in the well retirement arena. | ||
![]() | STEP 2 WELL DECOMMISSIONING Permanently plug and cap wellbore. | |||
![]() | STEP 3 SITE DECOMMISSIONING Remove and salvage/dispose of equipment. | |||
![]() | STEP 4 RECLAMATION Redistribute soil and revegetate for return to original state. | |||
PRINCIPAL RISKS —Health and Safety Risk —Regulatory and Political Risk —Climate Risk —Financial Strength and Flexibility Risk | KEY PERFORMANCE INDICATORS —Net cash provided by operating activities —Meet or exceed state asset retirement goals —Emissions intensity |
MAINTAIN NET DEBT-TO-ADJUSTED EBITDA AT OR BELOW 2.5x During 2023 our leverage ratio remained consistent at 2.3x and within our preferred goal of 2.0x to 2.5x. LINK TO STRATEGY —Acquire long-life stable assets —Generate reliable free cash flow (a)2023 is pro forma for the Tanos II acquisition completed in March 2023. 2022 is pro forma for the East Texas Assets and ConocoPhillips acquisitions. 2021 is pro forma for the Indigo, Blackbeard, Tanos and Tapstone acquisitions as well as Oaktree’s subsequent participation in the Indigo transaction. | NET DEBT-TO-PRO FORMA ADJUSTED EBITDA(a) ![]() | ||
CONSISTENT ADJUSTED EBITDA MARGIN Total revenue, inclusive of settled hedges for 2023 was $1,046 million, an increase of 2% compared to 2022. Adjusted EBITDA for 2023 was $543 million, an increase of 8% compared to 2022. LINK TO STRATEGY —Generate reliable free cash flow —Operate our assets in a safe, efficient and responsible manner | ADJUSTED EBITDA MARGIN ![]() | ||
ADJUSTED OPERATING COST PER MCFE Adjusted operating cost per Mcfe for 2023 was $1.76, a decrease of 1% compared with 2022. LINK TO STRATEGY —Operate our assets in a safe, efficient and responsible manner —Generate reliable free cash flow | ADJUSTED OPERATING COST PER MCFE ![]() | ||
NET CASH PROVIDED BY OPERATING ACTIVITIES Net cash provided by operating activities for 2023 was $410 million an increase of 6% compared with 2022. LINK TO STRATEGY —Operate our assets in a safe, efficient and responsible manner —Generate reliable free cash flow —Retire assets safely and responsibly and restore the environment to its natural state | NET CASH PROVIDED BY OPERATING ACTIVITIES ![]() | ||
EMISSIONS INTENSITY Significant improvement in our Scope 1 methane emissions intensity is primarily a result of our team’s steadfast focus on leak detection and mitigation across our portfolio, including meeting current year objectives to survey 100% of Central Region upstream assets while continuing like surveys in Appalachia to maintain no leak rates. Conversion of natural gas-driven pneumatic devices to compressed air also supported this tremendous achievement of a 33% year- over-year reduction. LINK TO STRATEGY —Acquire long-life stable assets —Operate our assets in a safe, efficient and responsible manner —Generate reliable free cash flow —Retire assets safely and responsibly and restore the environment to its natural state | METHANE EMISSIONS INTENSITY (MT CO2e/MMcfe) ![]() | ||
MEET OR EXCEED STATE ASSET RETIREMENT GOALS During 2023, we meaningfully expanded our asset retirement operations and permanently retired 222 wells, inclusive of our Central Regions operations. This achievement allowed us to more than double our Appalachian state requirements of 80 wells and exceed our goal to retire 200 wells by the end of 2023. Additionally, with our Next LVL Energy assets, we plugged 182 wells for third parties, including other operators and for the states of Ohio, Pennsylvania and West Virginia. LINK TO STRATEGY —Retire assets safely and responsibly and restore the environment to its natural state (a)DEC wells inclusive of 14 and 21 Central Region wells retired during 2022 and 2023, respectively. | ACTUAL WELLS RETIRED(a) ![]() | ||
SAFETY PERFORMANCE Our 2023 MVA rate is 0.55 incidents per million miles driven, a 20% improvement from 2022. Though five of nine operating areas incurred zero incidents in 2023, including two states who have not recorded an incident in more than four years, TRIR increased to 1.28, primarily driven by an increase in reported incidents in the remaining areas, in part a function of short-service employees with less than one year experience under the Group’s safety expectations. A new Safety Strategy Committee has been created to identify and advance specific areas for improvement and accountability. LINK TO STRATEGY —Operate our assets in a safe, efficient and responsible manner | MOTOR VEHICLE ACCIDENTS & TOTAL RECORDABLE INCIDENT RATE ![]() | ||
Safety No compromises Ensuring the care and wellbeing of our employees, our families and our communities is our top priority | ||
Production Every unit counts Ensuring every unit we safely produce provides affordable, reliable energy to our communities and generates value for our shareholders | ||
Efficiency Every dollar counts Ensuring every dollar we spend protects our employees, our communities and the investment of our shareholders | ||
Enjoyment Have fun delivering great results Ensuring our company is a great place to work, encouraging innovation and celebrating our employees’ accomplishments |
December 31, 2023 | |
SEC Pricing(a) | |
Proved developed reserves | |
Natural gas (MMcf) | 3,184,499 |
NGLs (MBbls) | 94,391 |
Oil (MBbls) | 12,380 |
Total proved developed reserves (MMcfe) | 3,825,125 |
Proved undeveloped reserves | |
Natural gas (MMcf) | 15,545 |
NGLs (MBbls) | 1,310 |
Oil (MBbls) | 236 |
Total proved undeveloped reserves (MMcfe) | 24,821 |
Total proved reserves | |
Natural gas (MMcf) | 3,200,044 |
NGLs (MBbls) | 95,701 |
Oil (MBbls) | 12,616 |
Total proved reserves (MMcfe) | 3,849,946 |
Prices used | |
Natural gas (Mmbtu) | $2.64 |
Oil and NGLs (Bbls) | $78.21 |
PV-10 (thousands) | |
Pre-tax (Non-GAAP)(b) | $2,139,690 |
PV of Taxes | (394,154) |
Standardized Measure | $1,745,536 |
Percent of estimated total proved reserves that are: | |
Natural gas | 83% |
Proved developed | 99% |
Proved undeveloped | 1% |
Total (MMcfe) | |
Total proved reserves as of December 31, 2020 | 3,250,588 |
Extensions and discoveries | — |
Revisions to previous estimates | 541,509 |
Purchase of reserves in place | 1,260,514 |
Sales of reserves in place | (164,039) |
Production | (259,543) |
Total proved reserves as of December 31, 2021 | 4,629,029 |
Extensions and discoveries | 13,326 |
Revisions to previous estimates | 379,812 |
Purchase of reserves in place | 331,043 |
Sales of reserves in place | (6,912) |
Production | (296,121) |
Total proved reserves as of December 31, 2022 | 5,050,177 |
Extensions and discoveries | 1,012 |
Revisions to previous estimates | (659,379) |
Purchase of reserves in place | 126,803 |
Sales of reserves in place | (369,035) |
Production | (299,632) |
Total proved reserves as of December 31, 2023 | 3,849,946 |
Total (MMcfe) | |
Proved undeveloped reserves as of December 31, 2020 | — |
Extensions and discoveries | — |
Revisions to previous estimates | — |
Purchase of reserves in place | 3,505 |
Sales of reserves in place | — |
Converted to proved developed reserves | — |
Proved undeveloped reserves as of December 31, 2021 | 3,505 |
Extensions and discoveries | 8,832 |
Revisions to previous estimates | — |
Purchase of reserves in place | — |
Sales of reserves in place | — |
Converted to proved developed reserves | (3,505) |
Proved undeveloped reserves as of December 31, 2022 | 8,832 |
Extensions and discoveries | — |
Revisions to previous estimates | — |
Purchase of reserves in place | 24,821 |
Sales of reserves in place | (8,832) |
Converted to proved developed reserves | — |
Proved undeveloped reserves as of December 31, 2023 | 24,821 |
Developed Acreage | Undeveloped Acreage | Total Acreage | ||||
Gross(a) | Net(b) | Gross(a) | Net(b) | Gross(a) | Net(b) | |
As of December 31, 2023 | 5,600,383 | 3,039,447 | 8,005,314 | 5,519,159 | 13,605,697 | 8,558,606 |
Gross | Net | |
2024 | 5,404 | 663 |
2025 | 24,906 | 2,876 |
2026 | 2,869 | 87 |
As of December 31, 2023 | |
Natural gas wells | 71,471 |
Oil wells | 3,044 |
Total gross productive wells | 74,515 |
Natural gas wells | 59,226 |
Oil wells | 1,413 |
Total net productive wells | 60,639 |
As of December 31, 2023(a) | |
Total gross in progress wells | 4.0 |
Total net in progress wells | 3.8 |
Development | ||||||
Productive Wells | Dry Wells | Total | ||||
Year | Gross | Net | Gross | Net | Gross | Net |
2023 | 4 | 4 | — | — | 4 | 4 |
2022 | 5 | 2 | — | — | 5 | 2 |
2021 | — | — | — | — | — | — |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Production | |||
Natural Gas (MMcf) | 256,378 | 255,597 | 234,643 |
NGLs (MBbls) | 5,832 | 5,200 | 3,558 |
Oil (MBbls) | 1,377 | 1,554 | 592 |
Total production (MMcfe) | 299,632 | 296,121 | 259,543 |
Average realized sales price | |||
(excluding impact of derivatives settled in cash) | |||
Natural gas (Mcf) | $2.17 | $6.04 | $3.49 |
NGLs (Bbls) | 24.23 | 36.29 | 32.53 |
Oil (Bbls) | 75.46 | 89.85 | 65.26 |
Total (Mcfe) | $2.68 | $6.33 | $3.75 |
Average realized sales price | |||
(including impact of derivatives settled in cash) | |||
Natural gas (Mcf) | $2.86 | $2.98 | $2.36 |
NGLs (Bbls) | 26.05 | 19.84 | 15.52 |
Oil (Bbls) | 68.44 | 72.00 | 71.68 |
Total (Mcfe) | $3.27 | $3.30 | $2.51 |
Operating costs per Mcfe | |||
LOE(a) | $0.71 | $0.62 | $3.31 |
Production taxes(b) | 0.21 | 0.25 | 0.53 |
Midstream operating expense(c) | 0.23 | 0.24 | 1.42 |
Transportation expense(d) | 0.32 | 0.40 | 1.28 |
Total operating expense per Mcfe | $1.47 | $1.51 | $6.54 |
Year Ended | |||
APPALACHIA | December 31, 2023 | December 31, 2022 | December 31, 2021 |
Production | |||
Natural Gas (MMcf) | 167,930 | 180,194 | 201,635 |
NGLs (MBbls) | 3,018 | 2,810 | 2,690 |
Oil (MBbls) | 394 | 423 | 446 |
Total production (MMcfe) | 188,402 | 199,592 | 220,451 |
Natural gas (MMcf) | |
2024 | 70,769 |
2025 | 16,658 |
2026 | — |
Thereafter | 360,114 |
“ | |||
We remain focused on environmental stewardship as well as meaningful and effective employee and community engagement, delivered with an intentional adherence to a strong foundation of good governance.” |
Our sustainability strategy is centered around prudent risk management, asset integrity, employee safety, environmental protection, and emissions reduction. From the wellhead to the boardroom, we are committed to our role as responsible stewards of the natural resources we manage, the people we employ and the environment in which we operate. We strive to adhere to quality operating standards with a strong focus on the environment, the health and safety of employees and positive engagement with our local communities. We believe our efforts to connect the meaningful and differentiated attributes associated with our natural gas will increasingly be recognized by the market as value is progressively placed on highly responsible operators of natural gas assets. We are committed to addressing key climate and environmental issues for our PLANET and likewise relevant social issues for the PEOPLE across our operations, and doing so with a constant focus on the values and PRINCIPLES under which we were founded and continue to operate. | ![]() |
![]() | ![]() | ![]() |
![]() | ![]() | ![]() |
![]() | GOVERNANCE EMBEDDING SUSTAINABILITY ACROSS THE ORGANIZATION |
![]() | STRATEGY UNDERPINNED BY DE-METHANIZATION OF OUR GAS PRODUCTION |
Risk | Potential Impact | Timeframe(a) | Risk Management Actions | ||
S | M | L | |||
MARKET | |||||
Changing global market sentiment as consumers transition away from fossil fuels will result in reduced natural gas & oil demand and impact the price outlook | —Negative impact on revenues and portfolio value —Reduced opportunities for acquiring commercially viable assets | • | • | —We conduct scenario analysis of portfolio impacts under a range of commodity price and demand outlooks to assess portfolio resiliency. —Our portfolio is heavily weighted towards gas, which is expected to remain more resilient than oil through the energy transition, particularly in North America. —Our low-cost production provides considerable resilience to lower commodity price environments. —Our robust hedging strategy provides financial assurance and protection against commodity price volatility in the short-, medium- and long-term. —Our compliance with OGMP Gold Standard Pathway will ensure we remain differentiated as a responsible gas producer, helping us sustain our competitive advantage through the decarbonization of our Scope 1 and 2 emissions. —We are pursuing other differentiated gas initiatives like TrustWell and other quantification-based efforts to market our lower gas intensity. | |
Increased cost of and more challenging or conditional access to capital | —Investors/lenders look to decrease their portfolio exposure to hydrocarbon assets —Capital available to Diversified may become more difficult to access, more costly, or come with additional climate-specific obligations | • | • | • | —We have committed to achieving Net Zero by 2040 from our Scope 1 and 2 emissions, aligning with mainstream lenders and investors in Western capital markets. —Our existing levels of fixed-rate debt and amortizing payments provide significant protection in the short/medium term. —We continue to pursue ESG-aligned asset-backed securitization (“ABS”) financing structures, where our achievement or out-performance of commitments to ambitious ESG KPIs attached to these ABS financings can improve borrowing rates and financing capacity. —Our hedging strategy provides short- to medium-term certainty and protection for cash flows available for reinvestment. —Our strategy of incremental M&A enables adaptation to changing market or financing conditions. |
Risk | Potential Impact | Timeframe(a) | Risk Management Actions | ||
S | M | L | |||
POLICY & LEGAL | |||||
Cost of carbon | —Implementation of some form of carbon cost or regulation in states where we operate could increase operating costs and make our natural gas less competitive vs. other forms of energy —Such policies could also accelerate pressure from investors and stakeholders to reduce emissions or improve energy efficiency, increasing our decarbonization costs | • | • | —Ongoing engagement in proactive, voluntary measurement of our Scope 1 emissions to ensure we fully understand potential portfolio liability. —We continue to engage in efforts to reduce emissions across our portfolio, such as leak detection and repair, pneumatics replacements, and compressor optimization. —We engage in cost-efficient operations and deploy SAM initiatives across our upstream and midstream portfolio. —We are engaging with third-party consultants to more fully develop our internal price of carbon metrics and strategy. —We include the evaluation of acquisition targets’ carbon footprints in our M&A process and final investment decisions. —Our evolving internal MACC analysis aided by field testing and/or small-scale pilot projects allows us to optimize the prioritization of identified emissions reduction projects. | |
Well retirement | —Acceleration of existing state well retirement commitments could significantly increase annual capital and operating costs —Underestimation of well retirement costs could significantly increase asset retirement obligation and future cash outlay for well retirement activities | • | • | —We actively engage with regulators regarding well retirement policies and activities. —We are committed to retiring wells ahead of state requirements (2023: 80 wells), including 201 Diversified-operated wells retired in 2023. —Our low-cost retirement capacity enables us to increase our own well-retirement targets, participate in state orphan well programs and carry out asset retirement for third parties. —Our extensive experience of well retirement, particularly in Appalachia, and our expanded retirement capabilities puts us in the best position to accurately forecast the future capital requirements for these activities. —Revenue streams from third-party asset retirements help to offset the cost of retiring our own wells. In addition, Diversified is exploring potential opportunities in alternative energy uses for wellbores (e.g. hydrogen production, carbon storage, mechanical battery storage). | |
Risk | Potential Impact | Timeframe(a) | Risk Management Actions | ||
S | M | L | |||
Litigation | —Potential litigation tied specifically to Diversified’s climate-related reporting (e.g. for misrepresentation) or actions could bring additional legal and reputational costs —Potential litigation around leaks or other sources of emissions (now or historical) | • | • | • | —We have focused, near-term efforts to achieve Scope 1 methane intensity reductions with a goal of net zero Scope 1 and 2 GHG emissions by 2040. —We expect continued development, funding, and execution of formal plans and projects will enable the achievement of emissions targets. —We continue to transparently report and communicate climate and emission reduction initiatives, keeping stakeholders abreast of such actions. —We actively engage with federal and U.S. state regulators, and consistently demonstrate our commitment to meet or exceed their requirements. —We maintain strong community support in our operating areas. —We are transitioning to an emissions intelligence software, Iconic Air, to track, report, and manage emissions, which will enable us to increase transparency, improve the integrity of our emissions measurements and therefore minimize potential litigation risk around leaks. —We work with independent consultants to verify our GHG accounting. —We engage an independent, third-party consultant to provide moderate Level II assurance for Scope 1 & 2 GHG emissions. |
Current & emerging climate- related regulation and policy | —Increasing costs of doing business as a fossil fuel-focused company; regulatory fines for emission levels; regulatory constraints on hydrocarbon commerce —Mandates on and regulation of existing products and services | • | • | • | —We actively monitor U.S. and international climate- related regulations and frameworks and engage as applicable, including: IFRS S1 & S2, Transition Plan Taskforce, SEC Climate Disclosures and TNFD. —We have multiple emissions reduction activities in place aimed at reducing methane emissions and achieving our 2040 net zero goal. —We actively engage with industry associations to ensure we are using best practices in operating procedures and emissions reductions. —Our experience from the many voluntary efforts made to date to reduce our methane emissions positions us to manage any impact arising from the U.S. EPA OOOOb and OOOOc regulations and U.S. Inflation Reduction Act’s Methane Emissions Reduction Program. |
Risk | Potential Impact | Timeframe(a) | Risk Management Actions | ||
S | M | L | |||
TECHNOLOGY | |||||
Cost of GHG emissions detection and reduction technology | —Increased costs of required technology; possible cost upside if more mitigation than expected is required | • | • | —Our emissions detection and reduction plans are already well-advanced with short- and medium-term costs factored into budgets. —We continue to benefit from the successful use of aerial and handheld leak detection equipment and from continuous investment in our low-cost SAM program to repair and eliminate fugitive emissions. —We continue to invest in leading-edge emissions reduction technologies and to monitor new technology developments, including aerial LiDAR, compressor conversions, handheld emissions detection, and pneumatic conversions. —We piloted two emerging emission detection and quantification technologies in 2023. Both technologies are expected to substantially reduce the cost of emissions detection while providing emissions quantification and a digital twin. —To date, we’ve experienced lower-than-expected costs of compressed air applications for pneumatic controllers. Our internally developed solutions for pneumatics and level controllers are well below market prices. —We continue to demonstrate innovative actions to reduce emissions, including retrofitting/elimination of existing emitting equipment (e.g. pneumatic devices and compressors). —Throughout 2023, we have continued to build and maintain our emissions intelligence using Iconic Air carbon accounting software to track, report and manage emissions. Using Iconic Air will allow us to streamline emissions accounting and reporting and manage our emissions sources at the asset-level. | |
Substitution of natural gas and oil with lower-carbon forms of energy | —Faster acceleration and adoption/ substitution of alternative energy/ lower carbon solutions (i.e., electric vehicles, more efficient appliances) drives lower demand for natural gas and oil | • | • | —The scenario analysis shows that gas plays an important role throughout the Energy Transition even in the Net Zero scenario (accounting for 22% of global energy demand in 2040). —Our scenario analysis shows that even under low- carbon scenarios our portfolio is relatively resilient. Due to our low cost of production, we are able to maintain profitable operations across our portfolio even under low commodity price environments (see Portfolio Resilience section). | |
Risk | Potential Impact | Timeframe(a) | Risk Management Actions | ||
S | M | L | |||
REPUTATIONAL | |||||
Overall perception of fossil fuels/ energy sector | —Increased stakeholder pressure to accelerate emissions reduction projects could increase short-term costs and challenge profit margins —Changes in stakeholder/society expectations of Diversified’s role in the energy transition could impact company valuation or brand —Increasing challenge to attract and/or retain talent | • | • | • | —We are committed to transparency in emissions and climate risk reporting, and to our plan of achieving our climate-related targets. —We engage regularly with shareholders, regulators and other key stakeholders to ensure understanding of our climate strategy. —We include climate metrics in short- and long-term remuneration policies to incentivize ongoing improvement in climate actions. —We are continuing to explore longer-term opportunities in new revenue-generating low-carbon energy projects, for example through waste heat recovery. —Broad leadership engagement through multiple communication channels keeps our current employees abreast of business strategy and emissions reduction actions and results. —Our community engagement initiatives and talent acquisition programs, including scholarship and internship programs, facilitate broader awareness of the Company and its climate-related actions among potential employee candidates. —Our community tree planting programs, such as Diversified’s 10,000 tree replanting effort with West Virginia State University in 2023, support communities, provide carbon sequestration, and increase the company’s visibility and engagement with our future talent. |
PHYSICAL | |||||
Acute – Changing weather patterns, including increased frequency and severity of extreme weather events such as extreme rainfall and hurricanes | —Increased risk of compromised infrastructure or forced abandonment of operations could cause loss of revenue and decrease portfolio value | • | • | • | —We have robust business continuity and crisis management plans in place, which were tested during the central Appalachia floods of 2022 and resulted in minimal business disruption. —We use 24-hour monitoring centers, enabling a more rapid response to weather-related disruptions. |
Chronic – Persistent or constantly recurring weather patterns, including water stress and heat stress | —Increasingly challenging and potentially dangerous environmental and climate conditions could increase operating costs and risks | • | • | —Our business model inherently requires minimal water consumption in our operations. —We maintain appropriate levels of insurance to mitigate losses. —The geographic spread of our asset portfolio mitigates any large-scale disruption to production from individual weather events e.g., flooding. —Further details on our exposure to physical risks and our qualitative assessment of our portfolio’s vulnerability to identified hazards are described in a separate section below. | |
Timeframe(a) | |||||
Opportunity | Potential Impact | S | M | L | Steps and Progress |
RESOURCE EFFICIENCY | |||||
Emissions monitoring and replacement of inefficient equipment | —Early detection of methane leaks reduces the loss of sales gas and associated revenues across the portfolio | • | • | • | —To reduce our GHG footprint, we continue to invest in remote leak detection, aerial surveillance, replacement of pneumatic devices, and inefficient compressors. —We actively track advances in emissions monitoring technologies and plan to take advantage of any suitable applications and technology cost reductions that evolve. —We continue to work on emissions intelligence digitalization and automation plans, supporting the connection of reported emissions data in the Iconic Air software to our MACC tool, to enhance the process of evaluating a broad scope of emissions reduction projects. |
Lowering vehicle- derived carbon emissions through optimization and more efficient vehicles; waste management recycling | —Fuel and operating cost savings by using vehicles that are more efficient and have lower carbon emissions | • | • | —We utilize lighter weight, more fuel-efficient vehicles in our fleet replacement program, which could further expand in the future to include the use of longer-range electric vehicles. —We are exploring new technologies to allow remote operations at well sites thus reducing vehicle use and associated emissions. —We utilize optimized route mapping to create the most efficient well tender routes thereby reducing vehicle run time, maintenance, fuel consumption and vehicle emissions. —We work internally to identify opportunities to reduce our carbon footprint within our office environment, for example paper consumption and waste recycling. | |
ENERGY SOURCE | |||||
Increase use of renewable energy sources | —Replace natural gas with renewable energy sources to support operational power needs | • | • | —Diversified uses solar equipment and small wind turbines to provide auxiliary power at certain smaller or remote well sites and has been increasing the use of solar equipment in its pneumatic conversion projects. —38% of our sources for Scope 2 electrical usage in 2023 were zero carbon (including nuclear and renewables). An additional 33% results from lower-carbon energy sources (including natural gas) versus coal or petroleum products. —We are exploring new technologies to expand the use of renewable and alternative energy in operations, including waste heat recovery and solid oxide fuel cells. Additionally, we are exploring the use of wellbores for mechanical battery energy storage to aid in the energy transition by providing off-peak energy storage. | |
Timeframe(a) | |||||
Opportunity | Potential Impact | S | M | L | Steps and Progress |
PRODUCTS & SERVICES | |||||
Asset retirement capabilities for third parties | —Providing third-party asset retirement services as an additional revenue stream and advancing states’ resolution of orphan wells —Support regional well retirement compliance —Continue to build internal asset retirement capabilities | • | • | • | —Our expanded well retirement capability supports our regional leadership position in responsible asset retirement. —We see an opportunity to grow our retirement capacity further via our subsidiary Next LVL Energy, positioning Diversified to further support states’ efforts to eliminate orphan wells. —Potential for expanded services including the generation of voluntary and regulated carbon credits related to well retirement of orphan wells held by state governments. —Expanded plugging commitments increase return of well pads to original, natural conditions thus supporting natural reforestation and biodiversity initiatives in those areas. |
Fuel cells and hydrogen applications | —Explore potential long-term revenue opportunities in blue hydrogen and/ or emissions reductions using fuel cells | • | • | —We continue to explore new opportunities in low- carbon technologies. —We are currently in the early stages of pursuing partnerships to evaluate potential of using existing midstream infrastructure for future hydrogen applications. | |
Carbon capture utilization and storage (CCUS) | —Explore the potential to provide carbon storage services to neighboring emitters —Potential to offset our Scope 1 & 2 emissions | • | • | —We are working with external partners to explore the potential of using our gas storage capacity for CCUS. | |
Solar | —Opportunities to lease land surface rights to third parties | • | • | • | —We are evaluating opportunities to expand surface rights leases to third parties for their development of solar power farms. |
MARKETS | |||||
OGMP Gold Standard Recognition | —Recognition of our commitment to deliver responsibly produced gas to the market —Enables further differentiation of our produced natural gas versus competitors | • | • | • | —Achieving Gold Standard Pathway in both 2022 and 2023 positions us to offer responsibly produced gas in the marketplace to differentiate it from other natural gas production. —As a member of OGMP, Diversified is committed to disclosing actual methane emissions data aligned with the OGMP 2.0 framework, thus further increasing our level of transparency for the market’s consideration when seeking differentiated gas. |
Acute |
Extreme Rainfall | Hurricanes |
Potential impacts: | Potential impacts: | ||
—Disruptions of operations due to flooding —Infrastructure damage | —Supply chain disruption —Increased operating costs —Impact on revenue | —Infrastructure damage due to extreme winds —Operational disruption from hurricanes | —Inland flooding —Increased operating costs —Impact on revenue |
Chronic |
Water Stress | Heat Stress |
Potential impacts: | Potential impacts: | ||
—Reduced community access to water —Infrastructure cost of fresh water supply | —Impact on supply chain —Increased operating costs —Impact on revenue | —Increased heat exposure is a health and safety risk for people —Decrease in work productivity —Infrastructure failure due to excess heat exceeding the design criteria (gas leaks) | —Additional energy needed for cooling —Increased operating costs —Impact on revenue |
Physical Risk | % of Diversified’s Projected 2040 Production in High or Extreme Risk Areas | |
Acute Risk | Extreme Rainfall | 84% |
Hurricanes | 4% | |
Chronic Risk | Water Stress | 22% |
Heat Stress | 41% |
AET -1.5 | IEA APS(a)(c) | IEA STEPS(b)(c) | |||||
Total Primary Energy Supply (1018 J) | CO2 Emissions (GT) | Total Primary Energy Supply (1018 J) | CO2 Emissions (GT) | Total Primary Energy Supply (1018 J) | CO2 Emissions (GT) | ||
![]() | ![]() | ![]() |
(a)Based on IEA data from the Announced Pledges Scenario of the IEA (2023) World Energy Outlook, www.iea.org/weo (b)Based on IEA data from the Stated Policies Scenario of the IEA (2023) World Energy Outlook, www.iea.org/ (c)Further detail on the IEA’s pricing methodology for the APS and STEPS scenarios can be found in the 2023 World Energy Outlook. |
Scenario | Portfolio Value Impact (NPV10) |
STEPS | 18% ![]() |
APS | -24% ![]() |
AET -1.5 | 7% ![]() |
Carbon Prices ($/MT) | |||
Scenario | 2026 | 2030 | 2040 |
IEA STEPS | N/A | N/A | N/A |
IEA APS | N/A | 135 | 175 |
WM AET 1.5 | 96 | 136 | 173 |
![]() | RISK MANAGEMENT IDENTIFYING, ASSESSING AND MANAGING CLIMATE-RELATED RISKS AND OPPORTUNITIES |
![]() | METRICS & TARGETS Beating Our Emissions Targets on Our Path Towards Net Zero |
GHG Emissions(a) | Unit | 2023 | 2022 | 2021 |
Scope 1 Emissions: | thousand MT CO2e | 1,561 | 1,820 | 1,631 |
Carbon Dioxide | thousand MT CO2 | 1,140 | 1,130 | 841 |
Methane(b) | thousand MT CO2e | 420 | 686 | 790 |
Nitrous Oxide | thousand MT CO2e | 1 | 4 | 1 |
% Methane | % | 27 | 38 | 48 |
Scope 1 Methane Intensity | MT CO2e/MMcfe | 0.8 | 1.2 | 1.5 |
Scope 1 Methane Intensity - NGSI(c) | % | 0.11 | 0.21 | 0.28 |
Scope 1 Emissions Attributable to:(b)(d) | ||||
Flared Hydrocarbons | thousand MT CO2e | — | 0 | 0 |
Other Combustion | thousand MT CO2e | 1,178 | 1,173 | 870 |
Process Emissions | thousand MT CO2e | 92 | 67 | 65 |
Other Vented Emissions | thousand MT CO2e | 63 | 182 | 295 |
Fugitive Emissions | thousand MT CO2e | 228 | 399 | 402 |
Scope 2 Emissions - Total Company(b) | thousand MT CO2e | 61 | 59 | 3 |
Energy consumption | million kWh | 134 | 128 | 7 |
Total Scope 1 and Scope 2(b) | thousand MT CO2e | 1,622 | 1,879 | 1,634 |
Scope 1 and Scope 2 GHG Emissions Intensity(b) | MT CO2e/MMcfe | 3.1 | 3.4 | 3.1 |
Air Quality(a)(e) | Unit | 2023 | 2022 | 2021 |
Nitrogen Oxide (NOx, excluding N2O) | metric tons | 21,520 | 21,546 | 16,126 |
Carbon Monoxide (CO) | metric tons | 18,448 | 18,530 | 13,842 |
Sulfur Oxide (SOx) | metric tons | 61 | 108 | 81 |
Volatile Organic Compounds (VOC) | metric tons | 3,108 | 4,421 | 6,632 |
Particulate Matter (PM Total) | metric tons | 137 | 140 | 105 |
2020 | 2021 | 2022 | 2023 | 2024 | |
STIP | 10% | 25% | 30% | 30% | 30% |
LTIP | N/A | N/A | 20% | 20% | 20% |
![]() | DEC wells(a) | ![]() | Total wells, including 3rd party(a) |
![]() | ![]() | MVA | — | Miles Driven |
2023 PRODUCTION EMPLOYEES | 2023 PRODUCTION SUPPORT EMPLOYEES |
![]() | ![]() |
2022 PRODUCTION EMPLOYEES | 2022 PRODUCTION SUPPORT EMPLOYEES |
![]() | ![]() |
![]() | Employees | Action and Engagement Our CEO and other executive management periodically conduct town hall meetings and field visits to personally and directly engage employees and to provide opportunities for employees to have direct management engagement. Our Board’s Non-Executive Director Employee Representative, Sandra M. Stash, also periodically engages with the workforce to receive employee feedback on our business strategy, corporate culture and remuneration policies, and shares this feedback with the Board. The valuable feedback from these meetings, along with that resulting from our updated corporate-wide Employee Experience Survey, is used to strengthen future employee engagement and initiatives. We also regularly conduct new hire surveys regarding the onboarding process and exit interviews, both important tools to further improve employee experiences. |
We know our employees are our greatest asset and therefore essential to our success and growth. We recognize the need for a skilled and committed workforce, with a diverse range of experience and perspectives, and we value that diversity and the contribution it affords. Key Areas of Focus —Incident management —Employee, driver and process safety —Diversity and equal opportunity —Employee development —Workplace culture | ||
![]() | Communities | Action and Engagement Through our formalized Community Giving and Engagement Program and other corporate initiatives, we provided approximately $2.1 million in financial support to numerous organizations, including adult and children’s health and well-being programs, local food banks, secondary and higher educational programs and initiatives, and municipal services throughout our 10-state footprint. We were especially pleased to support children’s initiatives which included purchasing and distributing, for the third consecutive year, more than 1,200 winter coats in the Central Region through Operation Warm, and participating in the U.S. Marine Corp Reserve Toys-for-Tots Christmas gift program. We also supported the purchase of back-to-school supplies for elementary classrooms across our footprint and separately collected and donated more than 4,200 books to local schools and libraries. Further, we supported U.S. veteran-focused programs that seek to promote mental health healing and wellness among combat-wounded veterans or those suffering with post-traumatic stress disorder. |
We actively seek to support sustainable socio-economic development in the communities in which we live and work and aim to minimize any potential negative impacts from our operations. From personal and socio-economic investment to strategic academic and educational support, our employees engage and serve their local communities through effective partnerships that make a real difference. Key Areas of Focus —Incident management —Effective grievance mechanisms —Environmental protection —Socio-economic investment and outreach —Local hiring |
![]() | Land and Mineral Owners | Action and Engagement During the year, our employees responded to nearly 34 thousand inquiries from our land and mineral owners through our in-house call center and recorded ~800 personal visits with landowners. We also distributed approximately $237 million in royalty payments during 2023. |
We seek to develop and maintain trusted relationships with our land and mineral owners with the recognition that these relationships are key to our business philosophy and ability to achieve our operational goals. Key Areas of Focus —Royalty payments —Incident management —Effective grievance mechanisms —Environmental protection | ||
![]() | Equity and Debt Investors | Action and Engagement We regularly provide financial, operational and other sustainability performance updates to our equity and debt investors. These updates may be in the form of investor relations presentations, press releases, website updates, or direct calls and meetings, inclusive of the CEO, CFO, COO, SVP-Investor Relations, SVP-Sustainability, SVP- EHS and/or Board Chairman, as applicable. The Annual General Meeting (“AGM”) also provides an opportunity for all shareholders to engage with the Board and Executive Management. Our increasing participation in energy conferences, industry events and non-deal roadshows has provided added opportunities for discussions with current and potential Credit Facility lenders and ABS investors particularly interested in our sustainability and emissions reductions strategies, activities and results. Reflective of that interest by ABS investors and our commitment to climate and operating targets, our recent ABS transactions, inclusive of our sustainability-linked Credit Facility, have included interest rate impacts tied to certain of these sustainability targets. |
We actively engage with our capital market partners, financial institutions and rating agencies to support a full understanding of our business and progress against our strategic priorities. Key Areas of Focus —Emissions reductions —Climate risk and energy transition —Incident management —Risk management —Corporate Governance —Financial stability —Access to funding | ||
![]() | Governments and Regulators | Action and Engagement Executive and operational management engage with federal, state and local regulators to address legislative, regulatory and operational matters important to our business and our industry. With risk identification and protection of the local environment and biodiversity in mind, we proactively and fully engage all applicable regulatory agencies before commencing a project to ensure transparent dialogue during the completion and approval of applicable environmental assessments and related actions. We also proactively and transparently engage with regulatory agencies throughout the year to keep them appraised of our operational and well retirement activities and to provide objective and measurable progress indicators. Our Next LVL well retirement subsidiary supports company efforts to exceed annual state plugging requirements while also supporting the well retirement needs of other oil and gas operators in the Appalachia Basin as well as the states in their respective federal orphan well retirement programs. |
We seek to develop and maintain positive relationships and regular dialogue with various stakeholder groups within our federal, state and local governments. Key Areas of Focus —Legal compliance —Tax payments to governments —Safe and efficient asset retirement —Emissions reductions —Risk management —Environmental protection |
![]() | Suppliers and Customers | Action and Engagement We use local suppliers and vendors in each of the states in which we conduct our operations. We engage the expertise and capability of a leading supply chain risk management firm to continuously screen and monitor contractor safety performance and compliance through stringent operating guidelines. With a network of approximately 700 suppliers, this real-time monitoring helps to ensure our suppliers are providing us with the necessary product and service quality to meet the expectations of our stakeholders and support ongoing agreements with those suppliers who satisfy our safety thresholds. We delivered 821 MMcfepd in 2023 with no cited process and pipeline safety events or associated civil penalties. We continue to use our pipeline awareness programs to provide relevant information and education to those who interact with our assets or employees. |
Our production is essential to supporting modern life. We work hard to deliver environmentally-focused, responsibly produced natural gas, NGLs and oil that satisfy regulatory requirements and meet the energy demands of our local communities and customers while supporting our climate goals. We strive to develop strong relationships with our suppliers that are built on trust, transparency and quality products and services. Key Areas of Focus —Incident management —Process safety —Procurement management —Access to funding | ||
![]() | Joint Operating Partners | Action and Engagement We fulfill our responsibility as operator by responsibly managing the wells, ensuring payment of related expenses, and distributing applicable revenues and royalties from the wells’ commodity sales. |
As operator, we work on behalf of our joint operating partners to safely and efficiently manage the assets and deliver our products. Key Areas of Focus —Access to funding —Risk management —Employee and process safety —Accident prevention | ||
![]() | Industry Associations | Action and Engagement Through our active participation and the sharing of operating best practices, technical knowledge and legislation updates, we believe that these associations add value to our business, support our industry at large and protect the interests of our stakeholders. Collaborative engagements in these associations provide us with a platform to help collectively advance the sector and industry as a whole. Our leadership’s participation in industry associations includes participation in national, regional and state associations in West Virginia, Virginia, Kentucky, Pennsylvania, Ohio, Oklahoma, Texas, and Louisiana. We are especially proud of employees’ involvement and leadership roles in organizations like the Women’s Energy Network of West Virginia which seeks to empower women across the energy value chain and the recognition of our efforts in receiving both the Industry Innovation award (for use of innovative technologies in emissions detection) and Individual Excellence award (for long- standing, proven leadership in the industry) as conveyed by the Virginia Department of Energy. |
Recognizing the benefit of collective and collaborative efforts among industry peers, we are actively involved in leadership and other roles in industry associations within the states in which we operate. Key Areas of Focus —Incident management —Environmental protection —Risk management —Industry advocacy and leadership —Accident prevention —Employee and driver safety —Landowner engagement |
Reporting Requirement | Policies | Reference within this Annual Report & Form 20-F | Page |
Environmental Matters | Code of Business Conduct & Ethics | ||
EHS | |||
Climate | |||
Business Partners | |||
Biodiversity | |||
Employees | Employee Relations | ||
Anti-Bribery & Corruption | |||
Compliance Hotline & Whistleblowing | |||
Code of Business Conduct & Ethics | |||
Human Rights | |||
Securities Dealing | |||
Human Rights | Code of Business Conduct & Ethics | ||
Human Rights | |||
Modern Slavery | |||
Business Partners | |||
Social Matters | Code of Business Conduct & Ethics | ||
EHS | |||
Human Rights | |||
Tax | |||
Anti-Corruption & Anti-Bribery | Anti-Bribery & Corruption | ||
Compliance Hotline & Whistleblowing | |||
Business Model | Code of Business Conduct & Ethics | ||
Principal Risks and Uncertainties | Compliance Hotline & Whistleblowing | ||
Non-Financial KPIs | Code of Business Conduct & Ethics | ||
EHS | |||
Climate | |||
Reporting Requirement | Reference within this Annual Report & Form 20-F | Page |
Board oversight of climate-related risks and opportunities. | ||
Identifying, assessing and managing climate-related risks and opportunities. | ||
How processes for identifying, assessing and managing climate-related risks are integrated into the overall risk management process. | ||
Principal climate-related risk and opportunities arising in connection with operations. | ||
Time periods by reference to which risks and opportunities are assessed. | ||
Actual and potential impacts of the principal climate- related risks and opportunities on the business model and strategy. | ||
Analysis of the resilience of the business model and strategy, taking into consideration different climate- related scenarios. | ||
Targets used by the organization to manage climate- related risks and to realize climate-related opportunities and of performance against those targets. | ||
KPIs used to assess progress against targets used to manage climate-related risks and realize climate-related opportunities and of the calculations on which those KPIs are based. |
“ | |||
I am very pleased to report that 2023 was an outstanding year for Diversified, with record financial results and solid operational performance from our assets. |
Year Ended | ||||
December 31, 2023 | December 31, 2022 | Change | % Change | |
Net production | ||||
Natural gas (MMcf) | 256,378 | 255,597 | 781 | —% |
NGLs (MBbls) | 5,832 | 5,200 | 632 | 12% |
Oil (MBbls) | 1,377 | 1,554 | (177) | (11%) |
Total production (MMcfe) | 299,632 | 296,121 | 3,511 | 1% |
Average daily production (MMcfepd) | 821 | 811 | 10 | 1% |
% Natural gas (Mcfe basis) | 86% | 86% | ||
Average realized sales price (excluding impact of derivatives settled in cash) | ||||
Natural gas (Mcf) | $2.17 | $6.04 | $(3.87) | (64%) |
NGLs (Bbls) | 24.23 | 36.29 | (12.06) | (33%) |
Oil (Bbls) | 75.46 | 89.85 | (14.39) | (16%) |
Total (Mcfe) | $2.68 | $6.33 | $(3.65) | (58%) |
Average realized sales price (including impact of derivatives settled in cash) | ||||
Natural gas (Mcf) | $2.86 | $2.98 | $(0.12) | (4%) |
NGLs (Bbls) | 26.05 | 19.84 | 6.21 | 31% |
Oil (Bbls) | 68.44 | 72.00 | (3.56) | (5%) |
Total (Mcfe) | $3.27 | $3.30 | $(0.03) | (1%) |
Revenue (in thousands) | ||||
Natural gas | $557,167 | $1,544,658 | $(987,491) | (64%) |
NGLs | 141,321 | 188,733 | (47,412) | (25%) |
Oil | 103,911 | 139,620 | (35,709) | (26%) |
Total commodity revenue | $802,399 | $1,873,011 | $(1,070,612) | (57%) |
Midstream revenue | 30,565 | 32,798 | (2,233) | (7%) |
Other revenue | 35,299 | 13,540 | 21,759 | 161% |
Total revenue | $868,263 | $1,919,349 | $(1,051,086) | (55%) |
Gain (loss) on derivative settlements (in thousands) | ||||
Natural gas | $177,139 | $(782,525) | $959,664 | (123%) |
NGLs | 10,594 | (85,549) | 96,143 | (112%) |
Oil | (9,669) | (27,728) | 18,059 | (65%) |
Net gain (loss) on commodity derivative settlements(a) | $178,064 | $(895,802) | $1,073,866 | (120%) |
Total revenue, inclusive of settled hedges | $1,046,327 | $1,023,547 | $22,780 | 2% |
Year Ended | ||||
December 31, 2023 | December 31, 2022 | Change | % Change | |
Per Mcfe Metrics | ||||
Average realized sales price | ||||
(including impact of derivatives settled in cash) | $3.27 | $3.30 | $(0.03) | (1%) |
Midstream and other revenue | 0.22 | 0.16 | 0.06 | 38% |
LOE | (0.71) | (0.62) | (0.09) | 15% |
Midstream operating expense | (0.23) | (0.24) | 0.01 | (4%) |
Employees, administrative costs and professional services | (0.26) | (0.26) | — | —% |
Recurring allowance for credit losses | (0.03) | — | (0.03) | (100%) |
Production taxes | (0.21) | (0.25) | 0.04 | (16%) |
Transportation expense | (0.32) | (0.40) | 0.08 | (20%) |
Proceeds received from leasehold sales | 0.08 | 0.01 | 0.07 | 700% |
Adjusted EBITDA per Mcfe | $1.81 | $1.70 | $0.11 | 6% |
Adjusted EBITDA Margin | 52% | 49% | ||
Other financial metrics (in thousands) | ||||
Adjusted EBITDA | $542,794 | $502,954 | $39,840 | 8% |
Operating profit (loss) | $1,161,051 | $(671,403) | $1,832,454 | (273%) |
Net income (loss) | $759,701 | $(620,598) | $1,380,299 | (222%) |
Year Ended | ||||
December 31, 2022 | December 31, 2021 | Change | % Change | |
Net production | ||||
Natural gas (MMcf) | 255,597 | 234,643 | 20,954 | 9% |
NGLs (MBbls) | 5,200 | 3,558 | 1,642 | 46% |
Oil (MBbls) | 1,554 | 592 | 962 | 163% |
Total production (MMcfe) | 296,121 | 259,543 | 36,578 | 14% |
Average daily production (MMcfepd) | 811 | 711 | 100 | 14% |
% Natural gas (Mcfe basis) | 86% | 90% | ||
Average realized sales price (excluding impact of derivatives settled in cash) | ||||
Natural gas (Mcf) | $6.04 | $3.49 | $2.55 | 73% |
NGLs (Bbls) | 36.29 | 32.53 | 3.76 | 12% |
Oil (Bbls) | 89.85 | 65.26 | 24.59 | 38% |
Total (Mcfe) | $6.33 | $3.75 | $2.58 | 69% |
Average realized sales price (including impact of derivatives settled in cash) | ||||
Natural gas (Mcf) | $2.98 | $2.36 | $0.62 | 26% |
NGLs (Bbls) | 19.84 | 15.52 | 4.32 | 28% |
Oil (Bbls) | 72.00 | 71.68 | 0.32 | —% |
Total (Mcfe) | $3.30 | $2.51 | $0.79 | 31% |
Revenue (in thousands) | ||||
Natural gas | $1,544,658 | $818,726 | $725,932 | 89% |
NGLs | 188,733 | 115,747 | 72,986 | 63% |
Oil | 139,620 | 38,634 | 100,986 | 261% |
Total commodity revenue | $1,873,011 | $973,107 | $899,904 | 92% |
Midstream revenue | 32,798 | 31,988 | 810 | 3% |
Other revenue | 13,540 | 2,466 | 11,074 | 449% |
Total revenue | $1,919,349 | $1,007,561 | $911,788 | 90% |
Year Ended | ||||
December 31, 2022 | December 31, 2021 | Change | % Change | |
Gain (loss) on derivative settlements (in thousands) | ||||
Natural gas | $(782,525) | $(263,929) | $(518,596) | 196% |
NGLs | (85,549) | (60,530) | (25,019) | 41% |
Oil | (27,728) | 3,803 | (31,531) | (829%) |
Net gain (loss) on commodity derivative settlements(a) | $(895,802) | $(320,656) | $(575,146) | 179% |
Total revenue, inclusive of settled hedges | $1,023,547 | $686,905 | $336,642 | 49% |
Per Mcfe Metrics | ||||
Average realized sales price | ||||
(including impact of derivatives settled in cash) | $3.30 | $2.51 | $0.79 | 31% |
Midstream and other revenue | 0.16 | 0.13 | 0.03 | 23% |
LOE | (0.62) | (0.46) | (0.16) | 35% |
Midstream operating expense | (0.24) | (0.23) | (0.01) | 4% |
Employees, administrative costs and professional services | (0.26) | (0.22) | (0.04) | 18% |
Recurring allowance for credit losses | — | 0.02 | (0.02) | (100%) |
Production taxes | (0.25) | (0.12) | (0.13) | 108% |
Transportation expense | (0.40) | (0.31) | (0.09) | 29% |
Proceeds received from leasehold sales | 0.01 | — | 0.01 | 100% |
Adjusted EBITDA per Mcfe | $1.70 | $1.32 | $0.38 | 29% |
Adjusted EBITDA Margin | 49% | 50% | ||
Other financial metrics (in thousands) | ||||
Adjusted EBITDA | $502,954 | $343,145 | $159,809 | 47% |
Operating profit (loss) | $(671,403) | $(467,064) | $(204,339) | 44% |
Net income (loss) | $(620,598) | $(325,206) | $(295,392) | 91% |
Year Ended | ||||
December 31, 2023 | December 31, 2022 | $ Change | % Change | |
Henry Hub | $2.74 | $6.62 | $(3.88) | (59%) |
Mont Belvieu | 34.11 | 51.04 | (16.93) | (33%) |
WTI | 77.62 | 93.53 | (15.91) | (17%) |
Year Ended | ||||
December 31, 2022 | December 31, 2021 | $ Change | % Change | |
Henry Hub | $6.62 | $3.84 | $2.78 | 72% |
Mont Belvieu | 51.04 | 47.49 | 3.55 | 7% |
WTI | 93.53 | 68.26 | 25.27 | 37% |
(In thousands) | Natural Gas | NGLs | Oil | Total |
Commodity revenue for the year ended December 31, 2021 | $818,726 | $115,747 | $38,634 | $973,107 |
Volume increase (decrease) | 73,129 | 53,414 | 62,780 | 189,323 |
Price increase (decrease) | 652,803 | 19,572 | 38,206 | 710,581 |
Net increase (decrease) | 725,932 | 72,986 | 100,986 | 899,904 |
Commodity revenue for the year ended December 31, 2022 | $1,544,658 | $188,733 | $139,620 | $1,873,011 |
Volume increase (decrease) | 4,717 | 22,935 | (15,903) | 11,749 |
Price increase (decrease) | (992,208) | (70,347) | (19,806) | (1,082,361) |
Net increase (decrease) | (987,491) | (47,412) | (35,709) | (1,070,612) |
Commodity revenue for the year ended December 31, 2023 | $557,167 | $141,321 | $103,911 | $802,399 |
(In thousands, except per unit data) | Year Ended December 31, 2023 | |||||||
Natural Gas | NGLs | Oil | Total Commodity | |||||
Revenue | Realized $ | Revenue | Realized $ | Revenue | Realized $ | Revenue | Realized $ | |
per Mcf | per Bbl | per Bbl | per Mcfe | |||||
Excluding hedge impact | $557,167 | $2.17 | $141,321 | $24.23 | $103,911 | $75.46 | $802,399 | $2.68 |
Commodity hedge impact | 177,139 | 0.69 | 10,594 | 1.82 | (9,669) | (7.02) | 178,064 | 0.59 |
Including hedge impact | $734,306 | $2.86 | $151,915 | $26.05 | $94,242 | $68.44 | $980,463 | $3.27 |
(In thousands, except per unit data) | Year Ended December 31, 2022 | |||||||
Natural Gas | NGLs | Oil | Total Commodity | |||||
Revenue | Realized $ | Revenue | Realized $ | Revenue | Realized $ | Revenue | Realized $ | |
per Mcf | per Bbl | per Bbl | per Mcfe | |||||
Excluding hedge impact | $1,544,658 | $6.04 | $188,733 | $36.29 | $139,620 | $89.85 | $1,873,011 | $6.33 |
Commodity hedge impact | (782,525) | (3.06) | (85,549) | (16.45) | (27,728) | (17.85) | (895,802) | (3.03) |
Including hedge impact | $762,133 | $2.98 | $103,184 | $19.84 | $111,892 | $72.00 | $977,209 | $3.30 |
(In thousands, except per unit data) | Year Ended December 31, 2021 | |||||||
Natural Gas | NGLs | Oil | Total Commodity | |||||
Revenue | Realized $ | Revenue | Realized $ | Revenue | Realized $ | Revenue | Realized $ | |
per Mcf | per Bbl | per Bbl | per Mcfe | |||||
Excluding hedge impact | $818,726 | $3.49 | $115,747 | $32.53 | $38,634 | $65.26 | $973,107 | $3.75 |
Commodity hedge impact | (263,929) | (1.13) | (60,530) | (17.01) | 3,803 | 6.42 | (320,656) | (1.24) |
Including hedge impact | $554,797 | $2.36 | $55,217 | $15.52 | $42,437 | $71.68 | $652,451 | $2.51 |
(In thousands, except per unit data) | Year Ended | |||||||
December 31, 2023 | Per | December 31, 2022 | Per | Total Change | Per Mcfe Change | |||
Per Mcfe | Per Mcfe | $ | % | $ | % | |||
LOE(a) | $213,078 | $0.71 | $182,817 | $0.62 | $30,261 | 17% | $0.09 | 15% |
Production taxes(b) | 61,474 | 0.21 | 73,849 | 0.25 | (12,375) | (17%) | (0.04) | (16%) |
Midstream operating expenses(c) | 69,792 | 0.23 | 71,154 | 0.24 | (1,362) | (2%) | (0.01) | (4%) |
Transportation expenses(d) | 96,218 | 0.32 | 118,073 | 0.40 | (21,855) | (19%) | (0.08) | (20%) |
Total operating expenses | $440,562 | $1.47 | $445,893 | $1.51 | $(5,331) | (1%) | $(0.04) | (3%) |
Employees, administrative costs and professional services(e) | 78,659 | 0.26 | 77,172 | 0.26 | 1,487 | 2% | — | —% |
Costs associated with acquisitions(f) | 16,775 | 0.06 | 15,545 | 0.05 | 1,230 | 8% | 0.01 | 20% |
Other adjusting costs(g) | 17,794 | 0.06 | 69,967 | 0.24 | (52,173) | (75%) | (0.18) | (75%) |
Non-cash equity compensation(h) | 6,494 | 0.02 | 8,051 | 0.03 | (1,557) | (19%) | (0.01) | (33%) |
Total operating and G&A expenses | $560,284 | $1.87 | $616,628 | $2.09 | $(56,344) | (9%) | $(0.22) | (11%) |
Depreciation, depletion and amortization | 224,546 | 0.75 | 222,257 | 0.75 | 2,289 | 1% | — | —% |
Allowance for credit losses(i) | 8,478 | 0.03 | — | — | 8,478 | 100% | 0.03 | 100% |
Total expenses | $793,308 | $2.65 | $838,885 | $2.84 | $(45,577) | (5%) | $(0.19) | (7%) |
(In thousands, except per unit data) | Year Ended | |||||||
December 31, 2022 | Per | December 31, 2021 | Per | Total Change | Per Mcfe Change | |||
Per Mcfe | Per Mcfe | $ | % | $ | % | |||
LOE(a) | $182,817 | $0.62 | $119,594 | $0.46 | $63,223 | 53% | $0.16 | 35% |
Production taxes(b) | 73,849 | 0.25 | 30,518 | 0.12 | 43,331 | 142% | 0.13 | 108% |
Midstream operating expenses(c) | 71,154 | 0.24 | 60,481 | 0.23 | 10,673 | 18% | 0.01 | 4% |
Transportation expenses(d) | 118,073 | 0.40 | 80,620 | 0.31 | 37,453 | 46% | 0.09 | 29% |
Total operating expenses | $445,893 | $1.51 | $291,213 | $1.12 | $154,680 | 53% | $0.39 | 35% |
Employees, administrative costs and professional services(e) | 77,172 | 0.26 | 56,812 | 0.22 | 20,360 | 36% | 0.04 | 18% |
Costs associated with acquisitions(f) | 15,545 | 0.05 | 27,743 | 0.11 | (12,198) | (44%) | (0.06) | (55%) |
Other adjusting costs(g) | 69,967 | 0.24 | 10,371 | 0.04 | 59,596 | 575% | 0.20 | 500% |
Non-cash equity compensation(h) | 8,051 | 0.03 | 7,400 | 0.03 | 651 | 9% | — | —% |
Total operating and G&A expenses | $616,628 | $2.09 | $393,539 | $1.52 | $223,089 | 57% | $0.57 | 38% |
Depreciation, depletion and amortization | 222,257 | 0.75 | 167,644 | 0.65 | 54,613 | 33% | 0.10 | 15% |
Allowance for credit losses(i) | — | — | (4,265) | (0.02) | 4,265 | (100%) | 0.02 | (100%) |
Total expenses | $838,885 | $2.84 | $556,918 | $2.15 | $281,967 | 51% | $0.69 | 32% |
(In thousands) | Year Ended | |||
December 31, 2023 | December 31, 2022 | $ Change | % Change | |
Net gain (loss) on commodity derivatives settlements(a) | $178,064 | $(895,802) | $1,073,866 | (120%) |
Net gain (loss) on interest rate swap(a) | (2,722) | (1,434) | (1,288) | 90% |
Gain (loss) on foreign currency hedges(a) | (521) | — | (521) | (100%) |
Total gain (loss) on settled derivative instruments | $174,821 | $(897,236) | $1,072,057 | (119%) |
Gain (loss) on fair value adjustments of unsettled financial instruments(b) | 905,695 | (861,457) | 1,767,152 | (205%) |
Total gain (loss) on derivative financial instruments | $1,080,516 | $(1,758,693) | $2,839,209 | (161%) |
(In thousands) | Year Ended | |||
December 31, 2022 | December 31, 2021 | $ Change | % Change | |
Net gain (loss) on commodity derivatives settlements(a) | $(895,802) | $(320,656) | $(575,146) | 179% |
Net gain (loss) on interest rate swaps(a) | (1,434) | (530) | (904) | 171% |
Gain (loss) on foreign currency hedges(a) | — | (1,227) | 1,227 | (100%) |
Total gain (loss) on settled derivative instruments | $(897,236) | $(322,413) | $(574,823) | 178% |
Gain (loss) on fair value adjustments of unsettled financial instruments(b) | (861,457) | (652,465) | (208,992) | 32% |
Total gain (loss) on derivative financial instruments | $(1,758,693) | $(974,878) | $(783,815) | 80% |
(In thousands) | Year Ended | |||
December 31, 2023 | December 31, 2022 | $ Change | % Change | |
Gain on bargain purchases | $— | $4,447 | $(4,447) | (100%) |
(In thousands) | Year Ended | |||
December 31, 2022 | December 31, 2021 | $ Change | % Change | |
Gain on bargain purchases | $4,447 | $58,072 | $(53,625) | (92%) |
(In thousands) | Year Ended | |||
December 31, 2023 | December 31, 2022 | $ Change | % Change | |
Interest expense, net of capitalized and income amounts(a) | $117,808 | $86,840 | $30,968 | 36% |
Amortization of discount and deferred finance costs | 16,358 | 13,903 | 2,455 | 18% |
Other | — | 56 | (56) | (100%) |
Total finance costs | $134,166 | $100,799 | $33,367 | 33% |
(In thousands) | Year Ended | |||
December 31, 2022 | December 31, 2021 | $ Change | % Change | |
Interest expense, net of capitalized and income amounts(a) | $86,840 | $42,370 | $44,470 | 105% |
Amortization of discount and deferred finance costs | 13,903 | 8,191 | 5,712 | 70% |
Other | 56 | 67 | (11) | (16%) |
Total finance costs | $100,799 | $50,628 | $50,171 | 99% |
(In thousands) | Year Ended | |||
December 31, 2023 | December 31, 2022 | $ Change | % Change | |
Income (loss) before taxation | $1,000,344 | $(799,502) | $1,799,846 | (225%) |
Income tax benefit (expenses) | (240,643) | 178,904 | (419,547) | (235%) |
Effective tax rate | 24.1% | 22.4% |
(In thousands) | Year Ended | |||
December 31, 2022 | December 31, 2021 | $ Change | % Change | |
Income (loss) before taxation | $(799,502) | $(550,900) | $(248,602) | 45% |
Income tax benefit (expenses) | 178,904 | 225,694 | (46,790) | (21%) |
Effective tax rate | 22.4% | 41.0% |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Expected tax at statutory U.S. federal income tax rate | 21.0% | 21.0% | 21.0% |
State income taxes, net of federal tax benefit | 3.1% | 1.2% | 4.4% |
Federal credits | —% | —% | 15.4% |
Other, net | —% | 0.2% | 0.2% |
Effective tax rate | 24.1% | 22.4% | 41.0% |
(In thousands, except per unit data) | Year Ended | |||
December 31, 2023 | December 31, 2022 | $ Change | % Change | |
Operating profit (loss) | $1,161,051 | $(671,403) | $1,832,454 | (273%) |
Net income (loss) | 759,701 | (620,598) | 1,380,299 | (222%) |
Adjusted EBITDA | 542,794 | 502,954 | 39,840 | 8% |
Earnings (loss) per share - basic | $16.07 | $(14.82) | $30.89 | (208%) |
Earnings (loss) per share - diluted | $15.95 | $(14.82) | $30.77 | (208%) |
(In thousands, except per unit data) | Year Ended | |||
December 31, 2022 | December 31, 2021 | $ Change | % Change | |
Operating profit (loss) | $(671,403) | $(467,064) | $(204,339) | 44% |
Net income (loss) | (620,598) | (325,206) | (295,392) | 91% |
Adjusted EBITDA | 502,954 | 343,145 | 159,809 | 47% |
Earnings (loss) per share - basic | $(14.82) | $(8.20) | $(6.62) | 81% |
Earnings (loss) per share - diluted | $(14.82) | $(8.20) | $(6.62) | 81% |
As of | |||
(In thousands) | December 31, 2023 | December 31, 2022 | December 31, 2021 |
LESS: Cash | $3,753 | $7,329 | $12,558 |
Available borrowings under the Credit Facility(a) | 134,817 | 183,332 | 222,263 |
Liquidity | $138,570 | $190,661 | $234,821 |
As of | ||
(In thousands) | December 31, 2023 | December 31, 2022 |
Credit Facility | $159,000 | $56,000 |
ABS I Notes | 100,898 | 125,864 |
ABS II Notes | 125,922 | 147,458 |
ABS III Notes | 274,710 | 319,856 |
ABS IV Notes | 99,951 | 130,144 |
ABS V Notes | 290,913 | 378,796 |
ABS VI Notes | 159,357 | 212,446 |
Term Loan I | 106,470 | 120,518 |
Other | 7,627 | 7,084 |
Total debt | $1,324,848 | $1,498,166 |
LESS: Cash | 3,753 | 7,329 |
LESS: Restricted cash | 36,252 | 55,388 |
Net debt | $1,284,843 | $1,435,449 |
Year Ended | |||
(In thousands) | December 31, 2023 | December 31, 2022 | December 31, 2021 |
Balance at beginning of period | $457,083 | $525,589 | $346,124 |
Additions(a) | 3,250 | 24,395 | 96,292 |
Accretion | 26,926 | 27,569 | 24,396 |
Asset retirement costs | (5,961) | (4,889) | (2,879) |
Disposals(b) | (17,300) | (16,779) | (16,500) |
Revisions to estimate(c) | 42,650 | (98,802) | 78,156 |
Balance at end of period | $506,648 | $457,083 | $525,589 |
Less: Current asset retirement obligations | 5,402 | 4,529 | 3,399 |
Non-current asset retirement obligations | $501,246 | $452,554 | $522,190 |
(In thousands) | Not Later Than One Year | Later Than One Year and Not Later Than Five Years | Later Than Five Years | |
Total | ||||
Undiscounted | $5,402 | $20,365 | $1,778,876 | $1,804,643 |
Discounted | 5,402 | 17,975 | 483,271 | 506,648 |
(In thousands) | Not Later Than One Year | Later Than One Year and Not Later Than Five Years | Later Than Five Years | |
Total | ||||
Undiscounted | $4,529 | $19,671 | $1,673,905 | $1,698,105 |
Discounted | 4,529 | 17,314 | 435,240 | 457,083 |
(In thousands) | Not Later Than One Year | Later Than One Year and Not Later Than Five Years | Later Than Five Years | |
Total | ||||
Undiscounted | $3,399 | $17,210 | $1,594,853 | $1,615,462 |
Discounted | 3,399 | 13,675 | 508,515 | 525,589 |
(In thousands) | Year Ended | |||
December 31, 2023 | December 31, 2022 | $ Change | % Change | |
Net cash provided by operating activities | $410,132 | $387,764 | $22,368 | 6% |
Net cash used in investing activities | (239,369) | (386,457) | 147,088 | (38%) |
Net cash provided by (used in) financing activities | (174,339) | (6,536) | (167,803) | 2,567% |
Net change in cash and cash equivalents | $(3,576) | $(5,229) | $1,653 | (32%) |
(In thousands) | Year Ended | |||
December 31, 2022 | December 31, 2021 | $ Change | % Change | |
Net cash provided by operating activities | $387,764 | $320,182 | $67,582 | 21% |
Net cash used in investing activities | (386,457) | (627,712) | 241,255 | (38%) |
Net cash provided by (used in) financing activities | (6,536) | 318,709 | (325,245) | (102%) |
Net change in cash and cash equivalents | $(5,229) | $11,179 | $(16,408) | (147%) |
(In thousands) | Not Later Than One Year | Later Than One Year and Not Later Than Five Years | Later Than Five Years | |
Total | ||||
Recorded contractual obligations | ||||
Trade and other payables | $53,490 | $— | $— | $53,490 |
Borrowings | 200,822 | 864,264 | 259,762 | 1,324,848 |
Leases | 10,563 | 20,559 | — | 31,122 |
Asset retirement obligation(a) | 5,402 | 20,365 | 1,778,876 | 1,804,643 |
Other liabilities(b) | 178,779 | 2,224 | — | 181,003 |
Off-Balance Sheet contractual obligations | ||||
Firm Transportation(c) | 28,242 | 29,919 | 183,209 | 241,370 |
Total | $477,298 | $937,331 | $2,221,847 | $3,636,476 |
ENTERPRISE RISK MANAGEMENT PROGRAM (Oversight and approval by the Audit & Risk Committee) |
RISK UNIVERSE Categories of risk | |||
![]() | ![]() | ||
STRATEGIC RISKS | LEGAL, REGULATORY & REPUTATIONAL RISKS | ||
![]() | ![]() | ||
OPERATIONAL RISKS | FINANCIAL RISKS | ||
ENTERPRISE RISK ASSESSMENT REVIEW (Senior Management Team led with business unit leader support) |
PRINCIPAL RISKS | |
—Corporate Strategy and Acquisition Risk —Cybersecurity Risk —Health and Safety Risk —Regulatory and Political Risk | —Climate Risk —Commodity Price Volatility Risk —Financial Strength and Flexibility Risk |
![]() | Strategic Risks |
![]() | Financial Risks |
![]() | Legal, Regulatory and Reputational Risks |
![]() | Operational Risk |
Our ERM program is based on risk identification, assessment, prioritization, monitoring and mitigation processes, which are continually evaluated and enhanced with experience and industry best practices. | |||
![]() |
The Chairman’s Governance Statement | |||||
Dear Shareholder, As a Board we have been driving our governance standards towards meeting best practice, and it has been my privilege to work with this Board which is committed to maintaining high standards of corporate governance. As Chairman of the Group, my role is to provide leadership, ensuring that the Board performs its role effectively and has the capacity, ability, structure, corporate governance systems and support to enable it to continue to do so. This Governance section of this Annual Report & Form 20-F provides an update on our Board and Corporate Governance Policy. It includes our Corporate Governance Code compliance statements and the reports of the Board committees, namely the Audit & Risk, Nomination & Governance, Remuneration, and Sustainability & Safety Committees. In these reports, we set out our governance structures and explain how we have applied the UK Corporate Governance Code and additional changes implemented due to the Group’s recent NYSE-listing. | ![]() | ||||
![]() David E. Johnson Chairman of the Board March 19, 2024 | |||||
“ | |||||
As a Board we have been driving our governance standards towards meeting or exceeding best practice. |
BOARD OF DIRECTORS Defines business strategy, assesses risks and monitors performance | ||||||
Remuneration Committee Responsible for the Group’s remuneration policy, and for setting pay levels and bonuses for senior management in line with individual performance. Ensures safety and sustainability KPIs are included in remuneration packages. | Sustainability & Safety Committee Monitors the Group’s social, ethical, environmental and safety performance, and oversees all sustainable development issues on behalf of the Board. | Nomination & Governance Committee Ensures a balance of skills, knowledge, independence, experience and diversity on the Board and its committees. Monitors the Group’s governance structure. | Audit & Risk Committee Supports the Board in monitoring the integrity of the Group’s financial statements and reviews the effectiveness of the Group’s system of internal controls and risk management systems. | |||
CEO Takes ultimate responsibility for delivering on strategy, financial and operating performance. | ||||||||
Executive Vice President of Operations Description of role Coordinates operating activities and sustainability initiatives to ensure transparency and long-term value for DEC’s stakeholders. | President & Chief Financial Officer Description of role Manages the finance and accounting activities of the Group and ensures that its financial reports are accurate and completed in a timely manner. Oversees the Group’s information technology function to ensure safety and soundness of internal controls and systems. | Chief Legal & Risk Officer Description of role Responsible for legal and compliance, government, policy engagement, community engagement and land and mineral owner engagement. | Executive Vice President & Investment Officer Description of role Responsible for identifying and valuing acquisition targets and for developing and implementing a commodity marketing strategy to maximize commodity revenues. | Chief Human Resources Officer Description of role Responsible for HR function and employee relations, policies, practices and operations. | ||||
Responsibility —Operations —EHS —Sustainability —Regulatory | Responsibility —Treasury —Accounting & Financial Reporting —Investor Relations —Information Technology —Sustainability Reporting | Responsibility —Legal & Compliance —Land —Policy Engagement —Community Relations | Responsibility —Acquisitions —Marketing | Responsibility —Human Resource | ||||
Risk Management Guidelines —Employee Handbook and Code of Business Conduct & Ethics —EHS Policy & Field Operating Guidelines —Socio-Economic Policy | Risk Management Guidelines —Employee Handbook and Code of Business Conduct & Ethics —Tax Policy —Anti-Bribery & Corruption Policies | Risk Management Guidelines —Employee Handbook and Code of Business Conduct & Ethics —Anti-Bribery & Corruption Policies —Compliance Hotline & Whistleblowing Policy —Securities Dealing Policy | Risk Management Guidelines —Employee Handbook and Code of Business Conduct & Ethics —Anti-Bribery & Corruption Policies | Risk Management Guidelines —Employee Handbook and Code of Business Conduct & Ethics —Anti-Bribery & Corruption Policies —Compliance Hotline & Whistleblowing Policy | ||||
Stakeholder Engagement Responsibility —Communities —Employees —Joint Operating Partners —Suppliers | Stakeholder Engagement Responsibility —Employees —Rating Agencies —Financial Institutions —Debt & Equity Investors | Stakeholder Engagement Responsibility —Employees —Industry Associations —Communities —Land & Mineral Owners —Government & Regulators | Stakeholder Engagement Responsibility —Customers | Stakeholder Engagement Responsibility —Employees —Communities |
GENDER DIVERSITY | TENURE | |
3 of 7 Directors are Female | 2 of 7 0-3 years | |
![]() | ||
![]() | ||
2 of 7 4-6 years | ||
![]() | ||
3 of 7 7+ years | ||
![]() |
Target | Progress |
The Board aspires to meet and ultimately exceed the target for at least 40% of Board positions to be held by females. | We are pleased to report that as at December 31, 2023, 43% of our Board identified as female. |
That at least one of the positions of Chair, CEO, CFO or Senior Independent Director is held by a female. | As of December 31, 2023, our Senior Independent Director position is held by a female. |
That at least one member of the Board is from a minority ethnic background. | While we have not achieved this target yet, we continually aspire to increase diverse representation on our Board. |
Number of Board members | Percentage of the Board | Number of senior positions on the Board (CEO, CFO, SID and Chair)(a) | Number in executive management | Percentage of executive management | |
Male | 4 | 57% | 3 | 6 | 67% |
Female | 3 | 43% | 1 | 3 | 33% |
Other categories | 0 | 0% | 0 | 0 | 0% |
Not specified/prefer not to say | 0 | 0% | 0 | 0 | 0% |
Number of Board members | Percentage of the Board | Number of senior positions on the Board (CEO, CFO, SID and Chair)(a) | Number in executive management | Percentage of executive management | |
White British or other White (including minority-white groups) | 7 | 100% | 4 | 9 | 100% |
Mixed/Multiple Ethnic Groups | 0 | 0% | 0 | 0 | 0% |
Asian/Asian British | 0 | 0% | 0 | 0 | 0% |
Black/African/Caribbean/ Black British | 0 | 0% | 0 | 0 | 0% |
Other ethnic group, including Arab | 0 | 0% | 0 | 0 | 0% |
Not specific/prefer not to say | 0 | 0% | 0 | 0 | 0% |
Board of Directors The Group has a commitment to strong governance, reporting and operating standards. At the date of this report, the current Board consists of seven Directors: including a Non-Executive Chair (who was independent upon appointment and whom the Group continues to consider independent), a Non-Executive Vice-Chair, an Executive Director, the Senior Independent Director, three additional independent Non-Executive Directors. | ||||
COMMITTEE MEMBERSHIPS | ||||
![]() | Audit & Risk | |||
![]() | Nomination | |||
![]() | Remuneration | |||
![]() | Sustainability & Safety | |||
![]() ![]() ![]() ![]() | Chair | |||
![]() | Committee Membership: Remuneration Committee, Sustainability & Safety Committee Experience: Mr. Johnson has served on our board of directors since February 2017 and as our Non-Executive Chairman of the Board since April 2019. He has worked at a number of leading investment firms, as both an investment analyst and a manager, and more recently in equity sales and investment management. Mr. Johnson currently serves on the board of Chelverton Equity Partners, an AIM-listed holding company, where he serves as a member of the Remuneration, Audit & Nomination committees. Previously, Mr. Johnson was a consultant at Chelverton Asset Management from August 2016 to February 2019. Prior to that, he worked as a fund manager for the investment department of a large insurance company and then as Head of Sales and Head of Equities at a London investment bank. Mr. Johnson earned a Bachelor of Arts in Economics from the University of Reading. Key Strengths: Investment sector knowledge; providing strong leadership to the Board in connection with the Board’s role of overseeing strategy and developing stakeholder relations. Current External Roles: Chelverton Equity Partners (Director), an AIM-listed holding company. |
David E. Johnson Non-Executive Chairman, Independent upon Appointment Age 63 Appointed February 3, 2017 and as Chair of the Board on April 30, 2019 |
![]() | Committee Membership: None Experience: Mr. Hutson is our co-founder and has served as our Chief Executive Officer since the founding of our predecessor entity in 2001. Mr. Hutson also serves on our board of directors. Mr. Hutson is the fourth generation in his family to immerse himself in the natural gas and oil industry, with family roots dating back to the early 1900s. Mr. Hutson spent many summers of his youth working with his father and grandfather in the oilfields of West Virginia. He graduated from Fairmont State College (WV) with a degree in accounting. After college, Mr. Hutson spent 13 years steadily progressing into multiple leadership roles at well-known banking institutions such as Bank One and Compass Bank. His final years in the banking industry were spent as CFO of Compass Financial Services. Building upon his experiences in the natural gas and oil industry, as well as the financial sector, Mr. Hutson established Diversified Energy Company in 2001. After years of refining his strategy, Mr. Hutson and his team took the Company public in 2017. He continues to lead his team and expand the Group’s footprint. With a rapidly growing portfolio, Mr. Hutson remains focused on operational excellence and creating shareholder value. Key Strengths: Deep understanding and leadership in the natural gas and oil sector; strong track record in developing and delivering results in line with strategy. Current External Roles: Vice Chairman of Board of Governors of Fairmont State University |
Rusty Hutson, Jr. Co-Founder and Chief Executive Officer Age 54 Appointed July 31, 2014 |
![]() | Committee Membership: Nomination & Governance Committee Experience: Mr. Thomas has served on our board of directors since January 2015. He is a consultant in the corporate team of the law firm Wedlake Bell LLP in London. During a legal career of over 35 years, Mr. Thomas specialises in advising on IPOs and secondary offerings of equity and debt on the London capital markets, corporate governance requirements for UK listed companies, corporate finance and M&A work (including cross-border transactions). Previously named one of The Lawyer’s “UK Hot 100 Lawyers” and ranked by both Chambers and Partners and Legal 500, Mr. Thomas has advised clients operating in a variety of sectors, including natural gas and oil, renewable energy, natural resources and mining, climate change, financial services and early stage technology. Mr. Thomas has also held senior management positions including seven years as the European Managing Partner of a global law firm headquartered in the United States. Key Strengths: Corporate law; advising on mergers and acquisitions; public offerings. Current External Roles: Wedlake Bell LLP (Consultant) and Jasper Consultants Limited (Director). |
Martin K. Thomas Non-Executive Vice Chair Age 59 (independent through 12/31/23) Appointed January 1, 2015 |
![]() | Committee Membership: Sustainability & Safety Committee (Chair), Remuneration Committee, Audit & Risk Committee Experience: Ms. Stash has served on our board of directors since October 2019. Ms. Stash accumulated more than 35 years of international experience in the natural gas and oil and hard rock and coal mining industries, beginning her career as one of the first female drilling engineers in North America and most recently served as Executive Vice President for Tullow Oil until her retirement on 1 April 2020. During her time in these industries, Ms. Stash developed deep business and operations experience across six continents and is recognized for her unique capabilities in bridging the extractive sector to external stakeholders – in government, civil society and at the community level. Her distinguished professional career also included roles at ARCO, TNK-BP, BP, Anaconda and Talisman Energy, and spanned top leadership positions in general management, commercial negotiations, operations and engineering, supply chain management, government and public affairs, sustainability and HSE. Ms. Stash holds a Directorship Certification through the National Association of Corporate Directors and also serves on the boards of Trans Mountain Company and Chaarat Gold. Key Strengths: Risk management and sustainability; operations and engineering; employee engagement Current External Roles: Colorado School of Mines (Board of Governors member), Trans Mountain Corporation, a Canadian Crown Corporation (Director) and Chaarat Gold Holdings Limited (Director), an AIM-listed gold mining company. |
Sandra M. Stash Independent Non-Executive Director and Non-Executive Director Employee Representative Age 64 Appointed October 21, 2019 |
![]() | Committee Membership: Audit & Risk Committee (Chair), Remuneration Committee Experience: Mr. Turner has served on our board of directors since May 2019. Mr. Turner serves as Chief Financial Officer of Regions Financial Corporation (“Regions”) and is a member of the Regions Executive Leadership Team. Regions is an NYSE-listed S&P 500 banking group. Mr. Turner leads all of Regions’ finance operations, including financial systems, investor relations, corporate treasury, corporate tax, management planning and reporting, and accounting. Mr. Turner joined Regions in 2005 and led the Internal Audit Division before being named Chief Financial Officer in 2010. His responsibilities included overseeing various audits of the overall corporation, reporting to the Audit and Risk Committee of the Board of Directors. Prior to joining Regions, Mr. Turner served as an Audit Partner of KPMG LLP and previously served Arthur Andersen LLP in a number of positions, culminating in Audit Partner. His primary focus was auditing financial institutions. Mr. Turner earned a BS degree in accounting from the University of Alabama and attended Tulane University in Louisiana. Key Strengths: Financial expert with recent and relevant experience; capital markets; financial operations; audit experience. Current External Roles: Regions Financial Corporation (CFO) and Junior Achievement of Alabama, Inc. (Board and Executive Committee). |
David J. Turner, Jr. Independent Non-Executive Director Age 60 Appointed May 27, 2019 |
![]() | Committee Membership: Nomination & Governance Committee (Chair), Audit & Risk Committee, Sustainability & Safety Committee Experience: Ms. Klaber has served on our board of directors since January 2023. Ms. Klaber has more than 30 years of experience with a focus on energy development and EHS compliance complements the Board’s collective experience. Ms. Klaber currently serves as the Managing Director of The Klaber Group, which provides strategic consulting services to businesses and organizations with a focus on energy development in the United States and abroad. Prior to founding The Klaber Group, Ms. Klaber launched and led the Marcellus Shale Coalition as its first CEO, growing the organization to be the premier regional trade association for the natural gas and oil industry in the Northeastern Unites States. As CEO from 2009 to 2013 of the Marcellus Shale Coalition, Ms. Klaber worked closely with elected leaders, regulators and member companies to advance the responsible development of the Appalachian Basin. Ms. Klaber's other experience also includes serving as the Executive Vice President for Competitiveness at the Allegheny Conference on Community Development and Executive Director of the Pennsylvania Economy League where her work focused on advancing key policy and regulatory matters. Earlier in her career, Ms. Klaber accumulated significant experience in EHS strategy and compliance with the international consulting firm Environmental Resource Management. Ms. Klaber holds an undergraduate degree in environmental science from Bucknell University and a Masters in Business Administration from Carnegie Mellon University. Key Strengths: Regulatory compliance, energy specific sustainability programs; EHS processes industry knowledge, risk management; governance Current External Roles: The Klaber Group (Managing Director); RLG International (Director) processes, industry knowledge, risk management; governance |
Kathryn Z. Klaber Independent Non-Executive Director Age 58 Appointed January 1, 2023 |
![]() | Committee Membership: Remuneration Committee (Chair), Nomination & Governance Committee Experience: Ms. Kerrigan has served on our board of directors since October 2021. Ms. Kerrigan provides a wealth of experience in the energy, industrial and transportation sectors where she has engaged in corporate responsibility and sustainability, merger and acquisition, regulatory, risk management, cybersecurity and information privacy matters. Ms. Kerrigan currently serves as the Chief Legal Officer for Occidental Petroleum (NYSE: OXY). Prior to working at Occidental, Ms. Kerrigan served as the Executive Director of the Kay Bailey Hutchinson Energy Center for Business, Law and Policy at the University of Texas where she also earned a Doctor of Jurisprudence degree and served in a number of roles with Marathon Oil Corporation over the course of more than 20 years. In her time with Marathon Oil Corporation, she held a number of roles overseeing public policy, legal and compliance, corporate positioning and external communications before retiring in 2017 after eight years as the Executive Vice President, General Counsel and Corporate Secretary. Prior to working at Marathon, Ms. Kerrigan served in various domestic and international corporate, government and legal roles, including an appointment to the United Nations Security Council in Geneva, Switzerland. Ms. Kerrigan holds a NACD Directorship Certification through the National Association of Corporate Directors. Key Strengths: Corporate law, governance, merger and acquisition, regulatory, risk management, cybersecurity and information privacy matters, corporate responsibility and sustainability. Current External Roles: Occidental Petroleum (Chief Legal Officer) and Team Industrial Services (Lead Director). |
Sylvia Kerrigan Senior Independent Non-Executive Director Age 58 Appointed October 11, 2021 |
![]() | Mr. Gray has served as our President and Chief Financial Officer since September 2023, and prior to that served as Executive Vice President, Chief Operating Officer since October 2016. Prior to joining us, Mr. Gray served as the Senior Vice President and Chief Financial Officer for Royal Cup, Inc. from August 2014 to October 2016. Prior to that, from 2006 to 2014, Mr. Gray served in various roles at The McPherson Companies, Inc., most recently as Executive Vice President and Chief Financial Officer from September 2006 to December 2013. Mr. Gray previously worked in various financial and operational roles at Saks Incorporated from 1997 to 2006. Mr. Gray has a B.S. degree in Accounting from the University of Alabama and earned his CPA license (Alabama). Key Strengths: Corporate structure; operational processes and management; acquisition integration; finance; strategic support to the CEO. Current External Roles: None |
Bradley G. Gray President and Chief Financial Officer Age 55 |
![]() | Mr. Sullivan has served as our Senior Executive Vice President, Chief Legal & Risk Officer, and Corporate Secretary since September 2023, and prior to that served as Executive Vice President, General Counsel and Corporate Secretary since 2019. Prior to joining us, Mr. Sullivan worked with Greylock Energy, LLC (an ArcLight Capital Partners portfolio company) and its predecessor, Energy Corporation of America, from 2012 to 2017, most recently as Executive Vice President, General Counsel and Corporate Secretary from 2017 to 2019. Prior to that, Mr. Sullivan served as counsel for EQT Corporation from 2006 to 2012. He is a member of the leadership and board of directors of several commerce, legal and industry groups, and has considerable experience in corporate governance and reporting, corporate responsibility and sustainability matters, complex commercial transactions, land/real estate, acquisitions & divestitures, financing, government investigations and corporate workouts and restructurings. Mr. Sullivan received a B.A. from the University of Kentucky and a J.D. degree from the West Virginia University College of Law. He holds licenses to practice law in several states, including Pennsylvania and West Virginia. Key Strengths: Legal expert, mergers and acquisitions, land/real estate, regulatory compliance and governance, risk management and strategic support to the CEO Current External Roles: None |
Ben Sullivan Senior Executive Vice President, Chief Legal & Risk Officer, and Corporate Secretary Age 45 |
Section | Topic | Location |
(1) | Interest capitalized | Director’s Report, starting on page 133 |
(2) | Publication of unaudited financial information | Not applicable |
(4) | Details of long-term incentive schemes | Directors’ Remuneration Report, starting on page 148 |
(5) | Waiver of emoluments by a Director | Not applicable |
(6) | Waiver of future emoluments by a Director | Not applicable |
(7) | Non pre-emptive issues of equity for cash | Share Capital, starting on page 134 |
(8) | As item (7), in relation to major subsidiary undertakings | Not applicable |
(9) | Parent participation in a placing by a listed subsidiary | Not applicable |
(10) | Contracts of significance | Material Contracts, starting on page 238 |
(11) | Provision of services by a controlling shareholder | Not applicable |
(12) | Shareholder waivers of dividends | Not applicable |
(13) | Shareholder waivers of future dividends | Not applicable |
(14) | Agreements with controlling shareholders | Not applicable |
Director | Appointed | Shares of £0.20 | % of Issued Share Capital |
Rusty Hutson, Jr. | July 31, 2014 | 1,207,645 | 2.54% |
Bradley G. Gray(a) | October 24, 2016 | 146,947 | 0.31% |
Martin K. Thomas | January 1, 2015 | 112,250 | 0.24% |
David E. Johnson | February 3, 2017 | 23,750 | 0.05% |
David J. Turner, Jr. | May 27, 2019 | 26,923 | 0.06% |
Sandra M. Stash | October 21, 2019 | 2,234 | 0.00% |
Kathryn Klaber | January 1, 2023 | 1,050 | 0.00% |
Sylvia Kerrigan | October 11, 2021 | 1,341 | 0.00% |
1,522,140 | 3.20% |
Type of Meeting | Number of Meetings Required to be Held | Number of Meetings Held |
Board of Directors | 0 | 11 |
Audit & Risk Committee | 3 | 6 |
Nomination & Governance Committee | 2 | 2 |
Remuneration Committee | 2 | 7 |
Sustainability & Safety Committee | 2 | 5 |
Director | Committee Seats (during 2023) | Board | Audit & Risk Committee | Nomination & Governance Committee | Safety & Sustainability Committee | Remuneration Committee |
Rusty Hutson, Jr. | None | 11 | 0 | 0 | 0 | 0 |
Bradley G. Gray(a) | None | 11 | 0 | 0 | 3 | 0 |
David E. Johnson | ![]() | 11 | 0 | 2 | 5 | 7 |
Martin K. Thomas(b) | ![]() | 11 | 4 | 2 | 0 | 0 |
Kathryn Z. Klaber(c) | ![]() | 11 | 2 | 2 | 5 | 0 |
Sandra M. Stash | ![]() | 11 | 6 | 0 | 5 | 7 |
David J. Turner, Jr. | ![]() | 11 | 6 | - | 0 | 7 |
Sylvia Kerrigan | ![]() | 9 | 0 | 2 | 0 | 7 |
Shareholders(a) | Number of Shares | % of Issued Share Capital |
NYSE Control Account | 3,160,498 | 6.64% |
Hargreaves Landsdown | 2,842,924 | 5.98% |
Interactive Investor | 2,480,602 | 5.21% |
Columbia Management Investment Advisers | 2,394,439 | 5.03% |
Vanguard Group | 2,326,236 | 4.89% |
JO Hambro Capital Management | 2,281,524 | 4.80% |
GLG Partners | 2,230,257 | 4.69% |
BlackRock | 2,054,151 | 4.32% |
M&G Investments | 1,998,712 | 4.20% |
abrdn | 1,929,927 | 4.06% |
![]() | ||||||
![]() | ![]() | ![]() | ![]() | ![]() | ||
Kathryn Z. Klaber (58) Independent Non-Executive Director (Chair as of 9/15/23) Strength: Regulatory, Sustainability Independence from: Management & Other interests | Martin K. Thomas (59) Non-Executive Director (Chair until 9/15/23; independent from 1/1/23 to 12/31/23) Strength: Legal Independence from: Other interests | Sylvia Kerrigan (58) Senior Independent Non-Executive Director Strength: Industry, Governance Independence from: Management & Other interests | David E. Johnson (63) Non-Executive Director, Independent upon appointment (until 9/15/23) Strength: Finance Independence from: Management & Other interests | David J. Turner, Jr. (60) Independent Non-Executive Director (committee member until 1/1/23) Strength: Finance Independence from: Management & Other interests |
![]() | |||||
![]() | ![]() | ![]() | ![]() | ||
David J. Turner, Jr. (60) Independent Non-Executive Director (Chair) Strength: Finance Independence from: Management & Other interests | Sandra M. Stash (64) Independent Non-Executive Director Strength: Industry Independence from: Management & Other interests | Kathryn Z. Klaber (58) Independent Non-Executive Director (as of 9/15/23) Strength: Regulatory, Sustainability Independence from: Management & Other interests | Martin K. Thomas (59) Non-Executive Director (until 9/15/23; Independent from 1/1/23 to 12/31/23) Strength: Legal Independence from: Other interests |
“ | |||
The committee reviewed the presentation of the Group’s audited results for the year ended December 31, 2023 and the unaudited results for the six months ended June 30, 2023 to ensure they were fair, balanced and understandable, when taken as a whole. |
![]() | |||||
![]() | ![]() | ![]() | ![]() | ||
Sylvia Kerrigan (58) Independent Non-Executive Director (Chair) Strength: Industry, Governance Independence from: Management & Other interests | David E. Johnson (63) Non-Executive Director, Independent upon Appointment Strength: Finance Independence from: Management & Other interests | Sandra M. Stash (64) Independent Non-Executive Director Strength: Industry Independence from: Management & Other interests | David J. Turner, Jr. (60) Independent Non- Executive Director (as of 1/1/23) Strength: Finance Independence from: Management & Other interests |
Stated Objective | Overview of Policy | Implementation for 2024 | |||||
Base salary | —Reviewed annually. —Consideration given to the performance of the Group, the individual’s performance, the individual responsibilities or scope of the role, and pay practices in relevant comparator companies in both the UK and U.S. | Executive Director(a): —CEO: Rusty Hutson, Jr.: $779,834 | |||||
Pension and benefits | —The current Executive Director does not receive a pension contribution and any future provision will be aligned to the wider workforce. | —The current Executive Director does not receive a pension contribution. —In line with the approach taken for all employees, the Group offers a retirement plan in accordance with subsection 401(k) of the Internal Revenue Code in which the Executive Director may make voluntary pre-tax contributions towards his own retirement. The Group matches the Executive Director’s contributions up to $26 thousand per annum. —Benefits consist of standard car and health/ insurance related benefits. | |||||
Annual bonus | —Maximum of 175% of salary for Rusty Hutson, Jr. —Paid in cash up to 100% of base salary; Outcomes above this level deferred as either shares or cash (at the individual’s discretion) for one year provided continued service. —Subject to the achievement of relevant performance conditions, both qualitative and quantitative. —Subject to malus and clawback provisions. | Potential awards for 2024 performance period: —Rusty Hutson, Jr.: 175% of salary —Performance conditions, which will have defined Threshold, Target, and Stretch payout criteria: | |||||
![]() | 50% adjusted EBITDA per share | ||||||
![]() | 20% cash cost per Mcfe | ![]() | 30% ESG/EHS | ||||
Long-term incentives | —Performance Share Awards, subject to service and performance over a three-year period, and eligible for payment of applicable Dividend Equivalent Rights during the vesting period. —Maximum award of 325% of salary for Rusty Hutson, Jr. —Subject to malus and clawback provisions. | Potential awards for 2024: —Rusty Hutson, Jr.: 325% of salary —Performance conditions: | |||||
![]() | 40% return on equity | ![]() | 10% relative TSR | ||||
![]() | 30% absolute TSR | ![]() | 20% emissions | ||||
Share ownership requirements | —Rusty Hutson, Jr.: 300% of salary —Continues to apply for first year post- employment, reducing to 200% of salary for the second year. | —Rusty Hutson, Jr. meets the requirement. |
Element and Purpose | Policy and Operation | Maximum | Performance Measures | |||
Base salary This is the core element of pay and reflects the individual’s role and position within the Group with some adjustment to reflect their capability and contribution. | —Base salaries will typically be reviewed annually, with consideration given to the performance of the Group and the individual, any changes in responsibilities or scope of the role and pay practices in relevant U.S. and UK comparator companies of a broadly similar size and complexity, with due account taken of both market capitalization and turnover. —The committee does not strictly follow benchmark pay data, but instead uses it as one of a number of reference points when considering, in its judgment, the appropriate level of salary. Base salary is paid monthly in cash. | —It is anticipated that salary increases will generally be in line with those awarded to the general workforce. That said, in certain circumstances (including, but not limited to, changes in role and responsibilities, market levels, individual and Group performance), the committee may make larger salary increases to ensure they are market competitive. The rationale for any such increase will be disclosed in the relevant Annual Report. | n/a | |||
Benefits To provide benefits valued by recipients. | —The Executive Director currently receives standard car and health/ insurance related benefits. —Where appropriate, the Group will meet certain costs relating to Executive Director relocations. —In line with the approach taken for all employees, the Group offers a retirement plan in accordance with subsection 401(k) of the Internal Revenue Code in which the Executive Director may make voluntary pre-tax contributions towards his own retirement. The Group matches the Executive Director’s contributions up to $26 thousand per annum. —The committee reserves the discretion to introduce new benefits where it concludes that it is appropriate to do so, having regard to the particular circumstances and to market practice. | —It is not possible to prescribe the likely change in the cost of insured benefits or the cost of some of the other reported benefits year to year. —Relocation expenses are subject to a maximum limit of 100% of base salary, provided that such expenses may be paid only in the year of appointment and for a further two financial years. —With limited exceptions, the U.S. Section 401(k) defined contribution plan currently provides company matching contributions up to a maximum of $26 thousand per annum. —The committee will monitor the costs of benefits in practice and will ensure that the overall costs do not increase by more than what the committee considers appropriate in all the circumstances. | n/a |
Element and Purpose | Policy and Operation | Maximum | Performance Measures | ||||
Pension To provide retirement benefits. | —Currently, no element of the Directors’ remuneration is pensionable, and the Group does not operate any pension scheme or other scheme providing retirement or similar benefits. —The committee reserves the discretion to introduce new benefits where it concludes that it is appropriate to do so, having regard to the particular circumstances and to market practice. | —The current Executive Director does not receive a pension contribution. —Any future pension provision will be limited to levels aligned to the contribution levels for the majority of the workforce. | n/a | ||||
Annual bonus plan To motivate the Executive Director and incentivize the delivery of performance over a one-year operating cycle, focusing on the short- to medium-term elements of our strategic aims. | —Annual bonus plan levels and the appropriateness of measures are reviewed annually at the commencement of each financial year to ensure they continue to support our strategy. —Once set, performance measures and targets will generally remain unchanged for the year, except to reflect events such as corporate acquisitions or other major transactions where the committee considers it to be necessary in its opinion to make appropriate adjustments. —Annual bonus plan outcomes can be paid in cash up to 100% of base salary. Outcomes above this level will be deferred as either cash or shares (at the individual’s discretion) for one year provided continued service. During the deferral period, the value of any dividends (if deferred as shares) will be paid in cash or shares. —Clawback provisions apply to the annual bonus plan, and malus and clawback will apply to deferred shares in accordance with the Group’s clawback and malus policies. | —The maximum level of annual bonus plan outcomes is 175% of base salary for the CEO. | —The performance measures applied may be financial or non-financial; quantitative and qualitative; and corporate, divisional or individual and with such weightings as the committee considers appropriate. The metrics and weightings applicable in 2024 are as follows: | ||||
![]() | 50% adjusted EBITDA per share | ||||||
![]() | 20% cash cost per Mcfe | ||||||
![]() | 30% ESG/EHS | ||||||
—Where a sliding scale of targets is used, attaining the threshold level of performance for any measure will not typically produce a payout of more than 25% of the maximum portion of the overall annual bonus attributable to that measure, with a sliding scale to full payout for maximum performance. —However, the annual bonus plan remains a discretionary arrangement and the committee retains a standard power to apply its discretion to adjust the outcome of the annual bonus plan for any performance measure (from zero to any cap), should it consider that to be appropriate. | |||||||
Element and Purpose | Policy and Operation | Maximum | Performance Measures | ||||
Long-term incentives To motivate and incentivize the delivery of sustained performance over the long- term, and to promote alignment with shareholders’ interests, the Group grants Performance Share Awards. | —Performance Share Awards vest over a period of three years, with awards vesting to the extent that performance conditions are satisfied. —Vested awards for the Executive Director will be subject to a further two-year holding period during which time awards may not normally be exercised or released but are no longer contingent on performance conditions or future employment. —After the vesting period, the value of any dividends accrued during the vesting period on Performance Share Awards will be paid in shares and will be subject to a further two-year holding period, or paid in cash at the end of a further two-year holding period. —Clawback and malus provisions apply to Performance Share Awards. | —Performance Share Awards may be granted with a maximum value of 325% of base salary per financial year to the CEO. —In determining the number of shares subject to an award, the market value of a share shall, unless the committee determines otherwise, be assumed to be the average share price for the five days following the announcement of the Group’s results for the previous financial year. | —The committee may set such performance conditions on Performance Share Awards as it considers appropriate, whether financial or non- financial and whether corporate, divisional or individual. Performance periods may be over such periods as the committee selects at grant, which will not be less than, but may be longer than, three years. —The metrics and weightings applicable in 2024 are as follows: | ||||
![]() | 40% Return on Equity | ||||||
![]() | 30% Absolute TSR | ||||||
![]() | 10% Relative TSR | ||||||
![]() | 20% Emissions | ||||||
—No more than 15% of awards vest for attaining the threshold level of performance conditions. The committee also has a standard power to apply its judgment to adjust the formulaic outcome of all performance measures to take account of any circumstances (including the performance of the Group, any individual or business) should it consider that to be appropriate. | |||||||
Element and Purpose | Policy and Operation | Maximum | Performance Measures | |||
Share ownership guidelines To further align the interests of the Executive Director with those of shareholders. | —The Executive Director is expected to build up a prescribed level of shareholding. —Minimum shareholding is 300% of base salary for the CEO. The committee reserves the power to amend, but not reduce, these levels in future years. —To the extent that the prescribed level has not been reached, the Executive Director will be expected to retain a proportion of the shares vesting under the Group’s share plans until the guideline is met. —Any vested Performance Share Award shares subject to a holding period and any shares awarded in connection with annual bonus deferral will be included for the purpose of the guidelines (discounted for anticipated tax liabilities). —A post-employment shareholding requirement normally applies to Performance Share Award shares vesting after the effective date of the Directors’ Remuneration Policy for 2022. The policy requires the Executive Director to hold the shares equivalent to his share ownership guideline at that date, for a period of one year post-employment and reducing to 200% of salary for the second year post-employment. | n/a | n/a | |||
Chairman’s and Non-Executive Directors’ fees To enable the Group to recruit and retain a Chairman of the Board and Non- Executive Directors of the highest caliber. | —The fees paid to the Chairman and Non- Executive Directors aim to be competitive with other U.S. and UK listed peers of equivalent size and complexity. —The fees payable are determined by the Board, and will include incremental committee Chair and additional responsibility fees (as applicable). Directors do not participate in decisions regarding their own fees. —Non-Executive Directors are reimbursed all necessary and reasonable expenses incurred in connection with the performance of their duties and any tax thereon in accordance with the Group’s Non-Executive Director Expense Reimbursement Policy. —No other benefits are envisaged for the Chairman and Non-Executive Directors, but the Group reserves the right to provide benefits, including company related travel and office support. | —Fees are paid monthly in cash. —A proportion of each Non- Executive Directors’ fees may be required to be used for the acquisition of Group shares which must then be held until they cease to be a Director. —The aggregate fees and any benefits of the Chairman and Non-Executive Directors will not exceed the limit from time to time prescribed within the Group’s Articles of Association for such fees. —Any increases actually made will be appropriately disclosed. | n/a |
Name | Date of Service Contract | Duration |
Rusty Hutson, Jr. | January 30, 2017 | Each Executive Director’s service agreement should be of indefinite duration, subject to termination by the Group or the individual on six months’ notice. The service agreements of all current Executive Directors comply with that policy. |
Bradley G. Gray(a) | January 30, 2017 | |
Name | Date of Letter of Appointment | Duration |
David E. Johnson | February 3, 2017 | |
Martin K. Thomas | January 1, 2015 | Initial period of 12 months, subject to re-election at each AGM of the Group and are terminable on three months’ notice given by either party. |
David J. Turner, Jr. | May 27, 2019 | |
Sandra M. Stash | October 21, 2019 | |
Kathryn Klaber | January 1, 2023 | |
Sylvia Kerrigan | October 11, 2021 |
Minimum | —Consists of base salary, benefits and pension. —Base salary is the salary to be paid in 2024. —Benefits are the value received in 2023. —No pension is provided, only 401(k) match to the extent applicable. |
Target | Based on what the Executive Director would receive if performance was on-target (excluding share price appreciation and dividends): —Annual bonus: Consists of the target bonus (50% of maximum opportunity used for illustrative purposes). —Long-Term Incentives (“LTI”): Consists of the target level of vesting (50% vesting) of Performance Share Awards (at 325% of salary for Rusty Hutson, Jr.). |
Maximum | Based on the maximum remuneration receivable (excluding share price appreciation and dividends): —Annual bonus: Consists of maximum bonus of 175% of base salary for Rusty Hutson, Jr. —LTI: Consists of full vesting of Performance Share Awards (at 325% of salary for Rusty Hutson, Jr.). |
Maximum with share price growth | Based on the Maximum scenario set out above but with a 50% share price increase applied to the value of Long-Term Incentive Plan (“LTIP”) awards. |
($ thousands) | Base Salary | Benefits | Benefit Plan(a) | Total Fixed |
Rusty Hutson, Jr. | $780 | $12 | $31 | $823 |
Executive Directors | Rusty Hutson, Jr. | Bradley G. Gray(a) | |||
(In thousands) | December 31, 2023 | December 31, 2022 | December 31, 2023 | December 31, 2022 | |
Salary/Fees | $750 | $720 | $323 | $437 | |
Taxable Benefits(b) | 12 | 12 | 8 | 12 | |
Benefit Plan(c) | 31 | 37 | 15 | 36 | |
Pension(d) | — | — | — | — | |
Total Fixed Pay | 793 | 769 | 346 | 485 | |
Bonus(e) | 825 | 1,072 | 305 | 558 | |
Long-Term Incentives(f) | 442 | 4,030 | 272 | 2,378 | |
Total Variable Pay | 1,267 | 5,102 | 577 | 2,936 | |
Total Remuneration | $2,060 | $5,871 | $923 | $3,421 | |
Non-Executive Directors - Total Remuneration (In thousands) | December 31, 2023 | December 31, 2022 | |||
David E. Johnson | $216 | $200 | |||
Martin K. Thomas | 155 | 145 | |||
David J. Turner, Jr. | 168 | 156 | |||
Sandra M. Stash | 156 | 145 | |||
Kathryn Z. Klaber(g) | 139 | — | |||
Sylvia Kerrigan | 160 | 120 |
Measure | Threshold | Target(a) | Maximum (100% Payout) | Actual | % of Total Bonus | Payout % |
Adjusted EBITDA per share(b) | $10.60 | $11.64 | $12.60 | $11.57 | 50% | 35.9% |
Cash cost per Mcfe(c) | $1.27 | $1.21 | $1.18 | $1.26 | 20% | 7.0% |
ESG and EHS | (See below) | 30% | 20.0% | |||
Total % of maximum | 62.9% | |||||
Total % of salary - Rusty Hutson, Jr. | 110.1% | |||||
Total % of salary - Bradley G. Gray | 94.4% |
% of Total Bonus | Payout % | ||
ESG - ENVIRONMENTAL | |||
Target | Performance | 15.00% | 15.00% |
Reduce methane intensity Threshold: 6% Target: 8% Stretch: 10% | Achieved: 10% | 10.00% | 10.00% |
Central emissions surveys Threshold: N/A Target: N/A Stretch: 100% | Achieved: 100% | 5.00% | 5.00% |
ESG - SOCIAL | |||
Target | Performance | 10.00% | 5.00% |
Reduce TRIR Rate: Threshold: 1.12 Target: 1.03 Stretch: 0.97 | Achieved: 1.28 | 5.00% | 0.00% |
Reduce MVA: Threshold: 0.85 Target: 0.80 Stretch: 0.75 | Achieved: 0.55 | 5.00% | 5.00% |
ESG - GOVERNANCE | |||
Target | Performance | 5.00% | 0.00% |
Diversity advisory team/Diversity training | Achieved: 0% | 5.00% | 0.00% |
% of Total Award | Threshold | Maximum | Achieved | Vesting % of Component | Payout %(a) | |
Three-Year Average ROE(b) | 40% | 15% | 25% | 25% | 100% | 40% |
Absolute TSR (per annum) | 40% | 10% | 20% | (7%) | 0% | 0% |
Three-Year TSR v FTSE 250 | 20% | Median | Upper Quartile | Below Median | 0% | 0% |
Maximum number of shares(a) | Number of shares to lapse(b) | Number of Shares to vest(c) | Estimated value at vesting(d) | Face value of awards vesting(e) | Impact of share price on vesting(f) | |
Rusty Hutson, Jr. | 65,359 | 39,213 | 26,146 | $441,606 | $870,662 | $(429,056) |
Bradley G. Gray | 40,183 | 24,108 | 16,075 | 271,507 | 535,298 | (263,791) |
Threshold | Maximum | Achieved | Vesting % of Component | |
Adjusted EPS | £3.80 | £4.40 | £2.20 | 0% |
Annualized TSR | 10% | 20% | 3% | 0% |
Exercise Price | Number of Shares in Tranche | Vesting % | Number of Shares Vesting | |
Rusty Hutson, Jr. | £24.00 | 40,000 | 0% | 0 |
Bradley G. Gray | £24.00 | 18,333 | 0% | 0 |
Value of Award as a % of Base Salary | Face Value of Award ($) | Number of Shares | |
Rusty Hutson, Jr. | 300% | $2,250,000 | 98,045 |
Bradley G. Gray | 250% | 1,137,500 | 49,567 |
RETURN ON EQUITY (40% OF TOTAL AWARD) | ABSOLUTE TSR (30% OF TOTAL AWARD) | |||
Three-Year Average ROE(a) | % of that Part of the Award that Vests | Three-Year TSR | % of that Part of the Award that Vests | |
Below 15% per annum | 0% | Below 10% per annum | 0% | |
15% per annum | 15% | 10% per annum | 15% | |
25% per annum or above | 100% | 20% per annum or above | 100% | |
15% to 25% per annum | Pro rata straight-line between 15% and 100% | 10% to 20% per annum | Pro rata straight-line between 15% and 100% | |
RELATIVE TSR (10% OF TOTAL AWARD) | EMISSIONS (20% OF TOTAL AWARD) | |||
Three-Year TSR v FTSE 250 | % of that Part of the Award that Vests | Emissions over Three Years | % of that Part of the Award that Vests | |
Below median | 0% | Below 8% Methane Intensity Reduction | 0% | |
Median | 15% | 8% Methane Intensity Reduction | 15% | |
Upper quartile or above | 100% | 20% Methane Intensity Reduction | 100% | |
Median to upper quartile | Pro rata straight-line between 15% and 100% | 8% to 20% Methane Intensity Reduction | Pro rata straight-line between 15% and 100% |
Rusty Hutson, Jr. | ||||||||||
Award Type | Exercise Price (£) | Grant Date | Interest at January 1, 2023 | Awards Granted in the Year | Accrued Dividend Equivalents | Awards Exercised in the Year | Awards Lapsed in the Year | Interest at December 31, 2023(a) | Exercise/Vesting Period | |
PSU | March 21, 2023 | — | 98,045 | 26,006 | — | — | 124,051 | March 2026 | (b) | |
PSU | March 15, 2022 | 81,275 | — | 17,994 | — | — | 99,269 | March 2025 | (c) | |
PSU | March 15, 2021 | 53,512 | — | 11,847 | — | 39,213 | 26,146 | March 2024 | (d) | |
Options | £24.00 | May 9, 2019 | 46,600 | — | — | — | 40,000 | 6,600 | May 2022 - May 2029 | (f) |
Options | £16.80 | April 14, 2018 | 64,333 | — | — | — | — | 64,333 | May 2021 - May 2028 | (g) |
Bradley G. Gray | ||||||||||
Award Type | Exercise Price (£) | Grant Date | Interest at January 1, 2023 | Awards Granted in the Year | Accrued Dividend Equivalents | Awards Exercised in the Year | Awards Lapsed in the Year | Interest at December 31, 2023(a) | Exercise/Vesting Period | |
PSU | March 21, 2023 | — | 49,567 | 13,146 | — | — | 62,713 | March 2026 | (b) | |
PSU | March 15, 2022 | 41,640 | — | 9,218 | — | — | 50,858 | March 2025 | (c) | |
PSU | March 15, 2021 | 32,899 | — | 7,284 | — | 24,108 | 16,075 | March 2024 | (d) | |
Options | £24.00 | May 9, 2019 | 21,358 | — | — | — | 18,333 | 3,025 | May 2022 - May 2029 | (e) |
Options | £16.80 | April 14, 2018 | 29,485 | — | — | — | — | 29,485 | May 2021 - May 2028 | (f) |
Shareholding | Shareholding Required (% of Salary) | Compliance With Share Ownership Guidelines | Share Interests | ||
Rusty Hutson, Jr. | 1,207,645 | 300% | ü | 320,399 | (a) |
Bradley G. Gray | 146,947 | – | N/A | 162,156 | (b) |
David E. Johnson | 23,750 | – | (c) | — | |
Martin K. Thomas | 112,250 | – | (c) | — | |
David J. Turner, Jr. | 26,923 | – | (c) | — | |
Sandra M. Stash | 2,234 | – | (c) | — | |
Kathryn Z. Klaber | 1,050 | – | (c) | — | |
Sylvia Kerrigan | 1,341 | – | (c) | — |
(In Thousands) | ||||
Year | CEO | Single Figure of Total Remuneration | Annual Bonus Pay-Out Against Maximum % | Long-Term Incentive Vesting Rates Against Maximum Opportunity % |
2023 | Rusty Hutson, Jr. | $2,060 | 63% | 40% |
2022 | Rusty Hutson, Jr. | $5,871 | 85% | 71% |
2021 | Rusty Hutson, Jr. | $2,195 | 85% | 45% |
2020 | Rusty Hutson, Jr. | $2,307 | 94% | 100% |
% Change from 2022 to 2023 | % Change from 2021 to 2022 | % Change from 2020 to 2021 | % Change from 2019 to 2020 | ||||||||||||
Name | Salary/ Fee | Annual Bonus | Taxable Benefits | Salary/ Fee | Annual Bonus | Taxable Benefits | Salary/ Fee | Annual Bonus | Taxable Benefits | Salary/ Fee | Annual Bonus | Taxable Benefits | |||
Rusty Hutson, Jr. | 4% | (23%) | —% | 4% | 21% | 20% | 3% | (7%) | 400% | 59% | 55% | —% | |||
Bradley G. Gray(a) | 4% | (45%) | (8%) | 3% | 3% | —% | 3% | (7%) | (14%) | 19% | 15% | 56% | |||
David E. Johnson | 8% | —% | —% | 19% | —% | —% | 3% | —% | —% | 66% | —% | —% | |||
Martin K. Thomas | 7% | —% | —% | 14% | —% | —% | 2% | —% | —% | 27% | —% | —% | |||
David J. Turner, Jr.(b) | 8% | —% | —% | 16% | —% | —% | 3% | —% | —% | 132% | —% | —% | |||
Sandra M. Stash(c) | 8% | —% | —% | 14% | —% | —% | 2% | —% | —% | 520% | —% | —% | |||
Kathryn Z. Klaber(d) | 100% | —% | —% | —% | —% | —% | 2% | —% | —% | —% | —% | —% | |||
Sylvia Kerrigan(e) | 33% | —% | —% | 445% | —% | —% | 100% | —% | —% | —% | —% | —% | |||
All employees, excluding Directors | 4% | 4% | —% | 5% | 5% | —% | 11% | (2%) | —% | 4% | 4% | —% |
Year | Method | 25th Percentile Pay Ratio | Average Pay Ratio | 75th Percentile Pay Ratio |
2023 | Option A | 25:1 | 17:1 | 16:1 |
2022 | Option A | 28:1 | 19:1 | 17:1 |
2021 | Option A | 44:1 | 30:1 | 28:1 |
(In thousands) | 2023 | 2022 | % Change |
Total gross employee pay | $124,834 | $113,267 | 10% |
Dividends/share buybacks | 179,089 | 178,146 | 1% |
(Binding Vote) | (Advisory Vote) | ||||
Approval of the Directors’ Remuneration Policy | Director Remuneration Report | ||||
Total number of votes | % of votes cast | Total number of votes | % of votes cast | ||
For | 27,783,031 | 83% | 21,839,879 | 62% | |
Against | 5,793,079 | 17% | 13,566,740 | 38% | |
Votes withheld | 1,164,541 | 910,347 |
RETURN ON EQUITY (40% OF TOTAL AWARD) | ABSOLUTE TSR (30% OF TOTAL AWARD) | |||
Three-Year Average ROE | % of that Part of the Award that Vests | Three-Year Absolute TSR | % of that Part of the Award that Vests | |
Below 15% per annum | —% | Below 10% per annum | —% | |
15% per annum | 15% | 10% per annum | 15% | |
25% per annum or above | 100% | 20% per annum or above | 100% | |
15% to 25% per annum | Pro rata straight-line between 15% and 100% | 10% to 20% per annum | Pro rata straight-line between 15% and 100% | |
RELATIVE TSR (10% OF TOTAL AWARD) | EMISSIONS (20% OF TOTAL AWARD) | |||
Three-Year TSR v FTSE 250 | % of that Part of the Award that Vests | Emissions over Three Years | % of that Part of the Award that Vests | |
Below median | —% | Below 5% Methane Intensity Reduction | —% | |
Median | 15% | 5% Methane Intensity Reduction | 15% | |
Upper quartile or above | 100% | 15% Methane Intensity Reduction | 100% | |
Median to upper quartile | Pro rata straight-line between 15% and 100% | 5% to 15% Methane Intensity Reduction | Pro rata straight-line between 15% and 100% |
GBP | Exchange Rate | USD | |
David J. Turner, Jr.(a) | £135 | 1.24 | $167 |
Sandra M. Stash(b) | 125 | 1.24 | 155 |
Sylvia Kerrigan(c) | 135 | 1.24 | 167 |
David E. Johnson | 174 | 1.24 | 216 |
Martin K. Thomas(d) | 125 | 1.24 | 155 |
Kathryn Z. Klaber(e) | 125 | 1.24 | 155 |
Total | £819 | $1,015 |
“ | |||
The Remuneration Committee is focused on ensuring that remuneration is designed to emphasize "pay for performance” | |||
![]() | ||||||
![]() | ![]() | ![]() | ![]() | |||
Sandra M. Stash (64) Independent Non-Executive Director (Chair) Strength: Industry Independence from: Management & Other interests | David E. Johnson (63) Non-Executive Chairman, Independent upon Appointment Strength: Finance Independence from: Management & Other interests | Kathryn Z. Klaber (58) Independent Non- Executive Director (as of 1/1/23) Strength: Regulatory, Sustainability Independence from: Management & Other Interests | Bradley G. Gray (55) President & Chief Financial Officer (Executive Director and committee member until 9/15/23) Strength: Industry, Finance Independence from: Other Interests |
“ | |||
The committee has extensive and relevant experience in EHS matters through their other business activities. | |||
Year Ended | ||||
Notes | December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Revenue | 6 | $ | $ | $ |
Operating expenses | 7 | ( | ( | ( |
Depreciation, depletion and amortization | 7 | ( | ( | ( |
Gross profit | $ | $ | $ | |
General and administrative expenses | 7 | ( | ( | ( |
Allowance for expected credit losses | ( | |||
Gain (loss) on natural gas and oil properties and equipment | 10,11 | ( | ||
Gain (loss) on sale of equity interest | 5 | |||
Unrealized gain (loss) on investment | 5 | |||
Gain (loss) on derivative financial instruments | 13 | ( | ( | |
Gain on bargain purchases | 5 | |||
Impairment of proved properties | 10 | ( | ||
Operating profit (loss) | $ | $( | $( | |
Finance costs | 21 | ( | ( | ( |
Accretion of asset retirement obligation | 19 | ( | ( | ( |
Other income (expense) | ( | |||
Income (loss) before taxation | $ | $( | $( | |
Income tax benefit (expenses) | 8 | ( | ||
Net income (loss) | $ | $( | $( | |
Other comprehensive income (loss) | ( | |||
Total comprehensive income (loss) | $ | $( | $( | |
Net income (loss) attributable to: | ||||
Diversified Energy Company PLC | $ | $( | $( | |
Non-controlling interest | ||||
Net income (loss) | $ | $( | $( | |
Earnings (loss) per share attributable to Diversified Energy Company PLC | ||||
Weighted average shares outstanding - basic | 9 | |||
Weighted average shares outstanding - diluted | 9 | |||
Earnings (loss) per share - basic | 9 | $ | $( | $( |
Earnings (loss) per share - diluted | 9 | $ | $( | $( |
Notes | December 31, 2023 | December 31, 2022 | |
ASSETS | |||
Non-current assets: | |||
Natural gas and oil properties, net | 10 | $ | $ |
Property, plant and equipment, net | 11 | ||
Intangible assets | 12 | ||
Restricted cash | 3 | ||
Derivative financial instruments | 13 | ||
Deferred tax assets | 8 | ||
Other non-current assets | 15 | ||
Total non-current assets | $ | $ | |
Current assets: | |||
Trade receivables, net | 14 | ||
Cash and cash equivalents | 3 | ||
Restricted cash | 3 | ||
Derivative financial instruments | 13 | ||
Other current assets | 15 | ||
Total current assets | $ | $ | |
Total assets | $ | $ | |
EQUITY AND LIABILITIES | |||
Shareholders' equity: | |||
Share capital | 16 | $ | $ |
Share premium | 16 | ||
Treasury reserve | ( | ( | |
Share based payment and other reserves | |||
Retained earnings (accumulated deficit) | ( | ( | |
Equity attributable to owners of the parent: | ( | ||
Non-controlling interests | 5 | ||
Total equity | $ | $( | |
Non-current liabilities: | |||
Asset retirement obligations | 19 | $ | $ |
Leases | 20 | ||
Borrowings | 21 | ||
Deferred tax liability | 8 | ||
Derivative financial instruments | 13 | ||
Other non-current liabilities | 23 | ||
Total non-current liabilities | $ | $ | |
Current liabilities: | |||
Trade and other payables | 22 | $ | $ |
Taxes payable | |||
Leases | 20 | ||
Borrowings | 21 | ||
Derivative financial instruments | 13 | ||
Other current liabilities | 23 | ||
Total current liabilities | $ | $ | |
Total liabilities | $ | $ | |
Total equity and liabilities | $ | $ |
Notes | Share Capital | Share Premium | Treasury Reserve | Share Based Payment and Other Reserves | Retained Earnings (Accumulated Deficit) | Equity Attributable to Owners of the Parent | Non- Controlling Interest | Total Equity | |
Balance as of January 1, 2021 | $ | $ | $( | $ | $ | $ | $ | $ | |
Net income (loss) | — | — | — | — | ( | ( | ( | ||
Other comprehensive income (loss) | — | — | — | — | — | ||||
Total comprehensive income (loss) | $— | $— | $— | $— | $( | $( | $ | $( | |
Non-controlling interest in acquired assets | 5 | — | — | — | — | — | — | ||
Issuance of share capital (equity placement) | 16 | — | — | — | — | ||||
Issuance of share capital (equity compensation) | — | — | ( | — | |||||
Dividends | 18 | — | — | — | — | ( | ( | — | ( |
Cancellation of warrants | 16 | — | — | — | ( | — | ( | — | ( |
Transactions with shareholders | $ | $ | $— | $ | $( | $ | $ | $ | |
Balance as of December 31, 2021 | $ | $ | $( | $ | $( | $ | $ | $ | |
Net income (loss) | — | — | — | — | ( | ( | ( | ||
Other comprehensive income (loss) | — | — | — | — | — | ||||
Total comprehensive income (loss) | $— | $— | $— | $— | $( | $( | $ | $( | |
Issuance of share capital (settlement of warrants) | 16 | — | — | — | — | ||||
Issuance of share capital (equity compensation) | — | — | ( | — | |||||
Issuance of EBT shares (equity compensation) | 16 | — | — | ( | — | — | — | ||
Repurchase of shares (EBT) | 16 | — | — | ( | — | — | ( | — | ( |
Repurchase of shares (share buyback program) | 16 | ( | — | ( | — | ( | — | ( | |
Dividends | 18 | — | — | — | — | ( | ( | — | ( |
Distributions to non- controlling interest owners | — | — | — | — | — | — | ( | ( | |
Cancellation of warrants | 16 | — | — | — | ( | — | ( | — | ( |
Transactions with shareholders | $( | $— | $( | $ | $( | $( | $( | $( | |
Balance as of December 31, 2022 | $ | $ | $( | $ | $( | $( | $ | $( | |
Net Income (loss) | — | — | — | — | |||||
Other comprehensive income (loss) | — | — | — | — | ( | ( | — | ( | |
Total comprehensive income (loss) | $— | $— | $— | $— | $ | $ | $ | $ | |
Issuance of share capital (equity placement) | 16 | — | — | — | — | ||||
Issuance of share capital (equity compensation) | — | — | — | ( | — | ||||
Issuance of EBT shares (equity compensation) | 16 | — | — | ( | — | — | — | ||
Repurchase of shares (share buyback program) | 16 | ( | — | ( | — | ( | — | ( | |
Dividends | 18 | — | — | — | — | ( | ( | — | ( |
Distributions to non- controlling interest owners | — | — | — | — | — | — | ( | ( | |
Transactions with shareholders | $ | $ | $( | $( | $( | $( | $( | $( | |
Balance as of December 31, 2023 | $ | $ | $( | $ | $( | $ | $ | $ |
Year Ended | ||||
Notes | December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Cash flows from operating activities: | ||||
Income (loss) after taxation | $ | $( | $( | |
Cash flows from operations reconciliation: | ||||
Depreciation, depletion and amortization | 7 | |||
Accretion of asset retirement obligations | 19 | |||
Impairment of proved properties | 10 | |||
Income tax (benefit) expense | 8 | ( | ( | |
(Gain) loss on fair value adjustments of unsettled financial instruments | 13 | ( | ||
Asset retirement costs | 19 | ( | ( | ( |
(Gain) loss on natural gas and oil properties and equipment | 5,10,11 | ( | ( | |
(Gain) loss on sale of equity interest | 5 | ( | ||
Unrealized (gain) loss on investment | 5 | ( | ||
Gain on bargain purchases | 5 | ( | ( | |
Finance costs | 21 | |||
Revaluation of contingent consideration | 24 | |||
Hedge modifications | 13 | ( | ( | |
Non-cash equity compensation | 17 | |||
Working capital adjustments: | ||||
Change in trade receivables and other current assets | ( | |||
Change in other non-current assets | ( | ( | ||
Change in trade and other payables and other current liabilities | ( | |||
Change in other non-current liabilities | ( | ( | ||
Cash generated from operations | $ | $ | $ | |
Cash paid for income taxes | ( | ( | ( | |
Net cash provided by operating activities | $ | $ | $ | |
Cash flows from investing activities: | ||||
Consideration for business acquisitions, net of cash acquired | 5 | $ | $( | $( |
Consideration for asset acquisitions | 5 | ( | ( | ( |
Proceeds from divestitures | 5 | |||
Payments associated with potential acquisitions | 15 | ( | ||
Acquisition related debt and hedge extinguishments | 5, 13 | ( | ||
Expenditures on natural gas and oil properties and equipment | 10,11 | ( | ( | ( |
Proceeds on disposals of natural gas and oil properties and equipment | 10,11 | |||
Deferred consideration payments | ( | |||
Contingent consideration payments | 24 | ( | ( | |
Net cash used in investing activities | $( | $( | $( | |
Cash flows from financing activities: | ||||
Repayment of borrowings | 21 | $( | $( | $( |
Proceeds from borrowings | 21 | |||
Cash paid for interest | 21 | ( | ( | ( |
Debt issuance costs | 21 | ( | ( | ( |
Decrease (increase) in restricted cash | 3 | ( | ||
Hedge modifications associated with ABS Notes | 13, 21 | ( | ( | |
Proceeds from equity issuance, net | 16 | |||
Principal element of lease payments | 20 | ( | ( | ( |
Cancellation (settlement) of warrants, net | 16 | ( | ||
Dividends to shareholders | 18 | ( | ( | ( |
Distributions to non-controlling interest owners | ( | ( | ||
Repurchase of shares by the EBT | 16 | ( | ||
Repurchase of shares | 16 | ( | ( | |
Net cash provided by (used in) financing activities | $( | $( | $ | |
Net change in cash and cash equivalents | ( | ( | ||
Cash and cash equivalents, beginning of period | ||||
Cash and cash equivalents, end of period | $ | $ | $ |
December 31, 2023 | December 31, 2022 | |
Cash restricted by asset-backed securitizations | $ | $ |
Other restricted cash | ||
Total restricted cash | $ | $ |
Classified as: | ||
Current asset | $ | $ |
Non-current asset | ||
Total | $ | $ |
Range in Years | |
Software | |
Other acquired intangibles(a) |
Range in Years | |
Buildings and leasehold improvements | |
Equipment | |
Motor vehicles | |
Midstream assets | |
Other property and equipment |
Amendments to IFRS | Effective Date |
Classification of Liabilities as Current or Non-Current and Non-Current Liabilities with Covenants | Annual periods beginning on or after January 1, 2024 |
Impact from Pricing | Scenario 1(a) | Scenario 2(b) |
Headroom/(impairment) | $( | $ |
Impact from Discount Rate | Scenario 1(a) | Scenario 2(b) |
Headroom/(impairment) | $ | $ |
Consideration paid | |
Cash consideration | $ |
Total consideration | $ |
Net assets acquired | |
Natural gas and oil properties | $ |
Asset retirement obligations, asset portion | |
Property, plant and equipment | |
Derivative financial instruments, net | |
Other receivables | |
Asset retirement obligations, liability portion | ( |
Other current liabilities | ( |
Net assets acquired | $ |
Consideration received | |
Cash consideration | $( |
Total consideration | $( |
Net assets divested | |
Natural gas and oil properties | $( |
Restricted cash | ( |
Derivative financial instruments, net | ( |
Other assets | ( |
Borrowings | |
Other liabilities | |
Net assets divested | $( |
Cost basis of investment retained | |
Gain on sale of equity interest | $( |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Revenues | $ | $ | $ |
Net income (loss) | ( | ( |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Natural gas | $ | $ | $ |
NGLs | |||
Oil | |||
Total commodity revenue | $ | $ | $ |
Midstream | |||
Other(a) | |||
Total revenue | $ | $ | $ |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
LOE(a) | $ | $ | $ |
Production taxes(b) | |||
Midstream operating expenses(c) | |||
Transportation expenses(d) | |||
Total operating expenses | $ | $ | $ |
Depreciation and amortization | |||
Depletion | |||
Total depreciation, depletion and amortization | $ | $ | $ |
Employees, administrative costs and professional services(e) | |||
Costs associated with acquisitions(f) | |||
Other adjusting costs(g) | |||
Non-cash equity compensation(h) | |||
Total G&A | $ | $ | $ |
Recurring allowance for credit losses(i) | ( | ||
Total expenses | $ | $ | $ |
Aggregate remuneration (including Directors): | |||
Wages and salaries | $ | $ | $ |
Payroll taxes | |||
Benefits | |||
Total employees and benefits expense | $ | $ | $ |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Number of production support employees, including Directors | |||
Number of production employees | |||
Workforce |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Executive Directors | |||
Salary | $ | $ | $ |
Taxable benefits(a) | |||
Benefit plan(b) | |||
Bonus(c) | |||
Long-term incentives(c) | |||
Total Executive Directors' remuneration | $ | $ | $ |
Non-Executive Directors | |||
Fees | $ | $ | $ |
Total Non-Executive Directors' remuneration | $ | $ | $ |
Total remuneration | $ | $ | $ |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Auditors' remuneration | |||
Fees payable to the Group’s external auditors and their associates for the audit of the consolidated financial statements(a) | $ | $ | $ |
Fees payable for the audit of the financial statements of the Company's subsidiaries(b) | |||
Audit-related assurance services(c) | |||
Other assurance services | |||
Total auditors' remuneration | $ | $ | $ |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Current income tax (benefit) expense | |||
Federal (benefit) expense | $ | $( | $ |
State (benefit) expense | |||
Foreign - UK (benefit) expense | ( | ||
Total current income tax (benefit) expense | $ | $ | $ |
Deferred income tax (benefit) expense | |||
Federal (benefit) expense | $ | $( | $( |
State (benefit) expense | ( | ( | |
Foreign - UK (benefit) expense | ( | ( | |
Total deferred income tax (benefit) expense | $ | $( | $( |
Total income tax (benefit) expense | $ | $( | $( |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Income (loss) before taxation | $ | $( | $( |
Income tax benefit (expenses) | ( | ||
Effective tax rate |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Expected tax at statutory U.S. federal income tax rate | |||
State income taxes, net of federal tax benefit | |||
Federal credits | |||
Other, net | |||
Effective tax rate |
December 31, 2023 | December 31, 2022 | |
Deferred tax asset | ||
Asset retirement obligations | $ | $ |
Derivative financial instruments | ||
Allowance for doubtful accounts | ||
Net operating loss carryover | ||
Federal tax credits carryover | ||
163(j) interest expense limitation | ||
Other | ||
Total deferred tax asset | $ | $ |
Deferred tax liability | ||
Amortization and depreciation | $( | $( |
Investment in partnerships | ( | ( |
Total deferred tax liability | $( | $( |
Net deferred tax asset (liability) | $ | $ |
Balance sheet presentation | ||
Deferred tax asset | $ | $ |
Deferred tax liability | ( | ( |
Net deferred tax asset (liability) | $ | $ |
Opening Balance | Consolidated Statement of Comprehensive Income | Other(a) | Closing Balance | |
Asset retirement obligations | $ | $ | $ | $ |
Allowance for doubtful accounts | ||||
Net operating loss carryover | ( | |||
Federal tax credits carryover | ( | |||
Property, plant, and equipment and natural gas and oil properties | ( | ( | ||
Derivative financial instruments | ( | |||
Investment in partnerships | ( | ( | ||
163(j) interest expense limitation | ||||
Other | ( | ( | ||
Total deferred tax asset (liability) | $ | $( | $( | $ |
Opening Balance | Consolidated Statement of Comprehensive Income | Other(a) | Closing Balance | |
Asset retirement obligations | $ | $( | $ | $ |
Allowance for doubtful accounts | ||||
Net operating loss carryover | ( | |||
Federal tax credits carryover | ||||
Property, plant, and equipment and natural gas and oil properties | ( | ( | ||
Derivative financial instruments | ||||
Investment in partnerships | ( | ( | ( | |
163(j) interest expense limitation | ||||
Other | ||||
Total deferred tax asset (liability) | $ | $ | $ | $ |
Opening Balance | Consolidated Statement of Comprehensive Income | Other(a) | Closing Balance | |
Asset retirement obligations | $ | $ | $ | $ |
Allowance for doubtful accounts | ( | |||
Net operating loss carryover | ( | |||
Federal tax credits carryover | ||||
Property, plant, and equipment and natural gas and oil properties | ( | ( | ( | |
Derivative financial instruments | ||||
Investment in partnerships | ( | ( | ( | |
Other | ||||
Total deferred tax asset (liability) | $( | $ | $( | $ |
Year Ended | ||||
Calculation | December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Net income (loss) attributable to Diversified Energy Company PLC | A | $ | $( | $( |
Weighted average shares outstanding - basic | B | |||
Dilutive impact of potential shares | ||||
Weighted average shares outstanding - diluted | C | |||
Earnings (loss) per share - basic | = A/B | $ | $( | $( |
Earnings (loss) per share - diluted | = A/C | $ | $( | $( |
Potentially dilutive shares(a) |
Year Ended | ||||
December 31, 2023 | December 31, 2022 | December 31, 2021 | ||
Costs | ||||
Beginning balance | $ | $ | $ | |
Additions(a) | ||||
Disposals(b) | ( | ( | ( | |
Ending balance | $ | $ | $ | |
Depletion and impairment | ||||
Beginning balance | $( | $( | $( | |
Depletion expense | ( | ( | ( | |
Impairment | ( | |||
Ending balance | $( | $( | $( | |
Net book value | $ | $ | $ |
Year Ended December 31, 2023 | ||||||
Buildings and Leasehold Improvements | Equipment | Motor Vehicles | Midstream Assets | Other Property and Equipment | Total | |
Costs | ||||||
Beginning balance | $ | $ | $ | $ | $ | $ |
Additions(a) | ||||||
Disposals | ( | ( | ( | ( | ( | |
Ending balance(b) | $ | $ | $ | $ | $ | $ |
Accumulated depreciation | ||||||
Beginning balance | $( | $( | $( | $( | $( | $( |
Period changes | ( | ( | ( | ( | ( | ( |
Disposals | ||||||
Ending balance | $( | $( | $( | $( | $( | $( |
Net book value | $ | $ | $ | $ | $ | $ |
Year Ended December 31, 2022 | ||||||
Buildings and Leasehold Improvements | Equipment | Motor Vehicles | Midstream Assets | Other Property and Equipment | Total | |
Costs | ||||||
Beginning balance | $ | $ | $ | $ | $ | $ |
Additions(a) | ||||||
Disposals | ( | ( | ( | ( | ( | |
Ending balance(b) | $ | $ | $ | $ | $ | $ |
Accumulated depreciation | ||||||
Beginning balance | $( | $( | $( | $( | $( | $( |
Period changes | ( | ( | ( | ( | ( | ( |
Disposals | ||||||
Ending balance | $( | $( | $( | $( | $( | $( |
Net book value | $ | $ | $ | $ | $ | $ |
Year Ended December 31, 2021 | ||||||
Buildings and Leasehold Improvements | Equipment | Motor Vehicles | Midstream Assets | Other Property and Equipment | Total | |
Costs | ||||||
Beginning balance | $ | $ | $ | $ | $ | $ |
Additions(a) | ||||||
Disposals | ( | ( | ( | ( | ||
Ending balance(b) | $ | $ | $ | $ | $ | $ |
Accumulated depreciation | ||||||
Beginning balance | $( | $( | $( | $( | $( | $( |
Period changes | ( | ( | ( | ( | ( | ( |
Disposals | ||||||
Ending balance | $( | $( | $( | $( | $( | $( |
Net book value | $ | $ | $ | $ | $ | $ |
Year Ended December 31, 2023 | |||
Software | Other Acquired Intangibles | Total | |
Costs | |||
Beginning balance | $ | $ | $ |
Additions(a) | |||
Disposals | ( | ( | ( |
Ending balance | $ | $ | $ |
Accumulated amortization | |||
Beginning balance | $( | $( | $( |
Period changes | ( | ( | ( |
Disposals | |||
Ending balance | $( | $( | $( |
Net book value | $ | $ | $ |
Year Ended December 31, 2022 | |||
Software | Other Acquired Intangibles | Total | |
Costs | |||
Beginning balance | $ | $ | $ |
Additions(a) | |||
Ending balance | $ | $ | $ |
Accumulated amortization | |||
Beginning balance | $( | $( | $( |
Period changes | ( | ( | ( |
Ending balance | $( | $( | $( |
Net book value | $ | $ | $ |
Year Ended December 31, 2021 | |||
Software | Other Acquired Intangibles | Total | |
Costs | |||
Beginning balance | $ | $ | $ |
Additions(a) | |||
Ending balance | $ | $ | $ |
Accumulated amortization | |||
Beginning balance | $( | $( | $( |
Period changes | ( | ( | ( |
Ending balance | $( | $( | $( |
Net book value | $ | $ | $ |
Swaps: | If the Group sells a swap, it receives a fixed price for the contract and pays a floating market price to the counterparty; |
Collars: | Arrangements that contain a fixed floor price (purchased put option) and a fixed ceiling price (sold call option) based on an index price which, in aggregate, have no net costs. At the contract settlement date, (1) if the index price is higher than the ceiling price, the Group pays the counterparty the difference between the index price and ceiling price, (2) if the index price is between the floor and ceiling prices, no payments are due from either party, and (3) if the index price is below the floor price, the Group will receive the difference between the floor price and the index price. Certain collar arrangements may also include a sold put option with a strike price below the purchased put option. Referred to as a three-way collar, the structure works similar to the above description, except that when the index price settles below the sold put option, the Group pays the counterparty the difference between the index price and sold put option, effectively enhancing realized pricing by the difference between the price of the sold and purchased put option; |
Basis swaps: | Arrangements that guarantee a price differential for commodities from a specified delivery point. If the Group sells a basis swap, it receives a payment from the counterparty if the price differential is greater than the stated terms of the contract and pays the counterparty if the price differential is less than the stated terms of the contract; |
Put options: | The Group purchases and sells put options in exchange for a premium. If the Group purchases a put option, it receives from the counterparty the excess (if any) of the market price below the strike price of the put option at the time of settlement, but if the market price is above the put’s strike price, no payment is due from either party. If the Group sells a put option, the Group pays the counterparty the excess (if any) of the market price below the strike price of the put option at the time of settlement, but if the market price is above the put’s strike price, no payment is due from either party; |
Call options: | The Group purchases and sells call options in exchange for a premium. If the Group purchases a call option, it receives from the counterparty the excess (if any) of the market price over the strike price of the call option at the time of settlement, but if the market price is below the call’s strike price, no payment is due from either party. If the Group sells a call option, it pays the counterparty the excess (if any) of the market price over the strike price of the call option at the time of settlement, but if the market price is below the call’s strike price, no payment is due from either party; and |
Swaptions: | If the Group sells a swaption, the counterparty will receive the option to enter into a swap contract at a specified date and receives a fixed price for the contract and pays a floating market price to the counterparty. |
NATURAL GAS CONTRACTS | Weighted Average Price per Mcfe(a) | ||||||
Volume | Sold | Purchased | Sold | Basis | Fair Value at | ||
(Mmbtu) | Swaps | Puts | Puts | Calls | Differential | December 31, 2023 | |
2024 | |||||||
Swaps | $ | $— | $— | $— | $— | $ | |
Collars | — | — | — | ||||
Stand-Alone Calls, net(b) | — | — | — | — | — | ( | |
Basis Swaps | — | — | — | — | ( | ( | |
Total 2024 contracts | |||||||
2025 | |||||||
Swaps | $ | $— | $— | $— | $— | $( | |
Stand-Alone Calls, net(b) | — | — | — | — | — | ( | |
Basis Swaps | — | — | — | — | ( | ||
Total 2025 contracts | ( | ||||||
2026 | |||||||
Swaps | $ | $— | $— | $— | $— | $( | |
Stand-Alone Calls | — | — | — | — | ( | ||
Basis Swaps | — | — | — | — | ( | ( | |
Total 2026 contracts | ( | ||||||
2027 | |||||||
Swaps | $ | $— | $— | $— | $— | $( | |
Collars | — | — | — | ||||
Stand-Alone Calls | — | — | — | — | ( | ||
Purchased puts | — | — | — | — | |||
Sold puts | — | — | — | — | ( | ||
2028 | |||||||
Swaps | $ | $— | $— | $— | $— | $( | |
Collars | — | — | — | ||||
Purchased puts | — | — | — | — | |||
Sold puts | — | — | — | — | ( | ||
2029 | |||||||
Swaps | $ | $— | $— | $— | $— | $( | |
Collars | — | — | — | ||||
Purchased puts | — | — | — | — | |||
Sold puts | — | — | — | — | ( | ||
2030 | |||||||
Swaps | $ | $— | $— | $— | $— | $( | |
Purchased puts | — | — | — | — | |||
Sold puts | — | — | — | — | ( | ||
Swaptions | |||||||
10/1/2024-9/30/2028(c) | $ | $— | $— | $— | $— | $( | |
1/1/2025-12/31/2029(d) | — | — | — | — | ( | ||
4/1/2026-3/31/2030(e) | — | — | — | — | ( | ||
4/1/2030-3/31/2032(f) | — | — | — | — | ( | ||
Total 2027-2032 contracts | $( | ||||||
Total natural gas contracts | $( |
NGLs CONTRACTS | Weighted Average Price per Bbl | |||
Volume | Sold | Fair Value at | ||
(MBbls) | Swaps | Calls | December 31, 2023 | |
2024 | ||||
Swaps | $ | $— | $ | |
Stand-Alone Calls | — | ( | ||
2025 | ||||
Swaps | $ | $— | $( | |
2026 | ||||
Swaps | $ | $— | $( | |
Total NGLs contracts | $ |
OIL CONTRACTS | Weighted Average Price per Bbl | |||
Volume | Sold | Fair Value at | ||
(MBbls) | Swaps | Calls | December 31, 2023 | |
2024 | ||||
Swaps | $ | $— | $( | |
Sold Calls | — | ( | ||
2025 | ||||
Swaps | $ | $— | $( | |
2026 | ||||
Swaps | $ | $— | $( | |
2027 | ||||
Swaps | $ | $— | $( | |
Total oil contracts | $( |
INTEREST | Principal Hedged | Fair Value at | |
Fixed-Rate | December 31, 2023 | ||
2023 | |||
SOFR Interest Rate Swap | $ | ||
Net fair value of derivative financial instruments as of December 31, 2023 | $( |
Derivative Financial Instruments | Consolidated Statement of Financial Position | December 31, 2023 | December 31, 2022 |
Assets: | |||
Non-current assets | Derivative financial instruments | $ | $ |
Current assets | Derivative financial instruments | ||
Total assets | $ | $ | |
Liabilities | |||
Non-current liabilities | Derivative financial instruments | $( | $( |
Current liabilities | Derivative financial instruments | ( | ( |
Total liabilities | $( | $( | |
Net assets (liabilities): | |||
Net assets (liabilities) - non-current | Other non-current assets (liabilities) | $( | $( |
Net assets (liabilities) - current | Other current assets (liabilities) | ( | |
Total net assets (liabilities) | $( | $( |
December 31, 2023 | |||
Presented without Effects of Netting | Effects of Netting | As Presented with Effects of Netting | |
Non-current assets | $ | $( | $ |
Current assets | ( | ||
Total assets | $ | $( | $ |
Non-current liabilities | ( | ( | |
Current liabilities | ( | ( | |
Total liabilities | $( | $ | $( |
Total net assets (liabilities) | $( | $ | $( |
December 31, 2022 | |||
Presented without Effects of Netting | Effects of Netting | As Presented with Effects of Netting | |
Non-current assets | $ | $( | $ |
Current assets | ( | ||
Total assets | $ | $( | $ |
Non-current liabilities | ( | ( | |
Current liabilities | ( | ( | |
Total liabilities | $( | $ | $( |
Total net assets (liabilities) | $( | $ | $( |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Net gain (loss) on commodity derivatives settlements(a) | $ | $( | $( |
Net gain (loss) on interest rate swaps(a) | ( | ( | ( |
Gain (loss) on foreign currency hedges(a) | ( | ( | |
Total gain (loss) on settled derivative instruments | $ | $( | $( |
Gain (loss) on fair value adjustments of unsettled financial instruments(b) | ( | ( | |
Total gain (loss) on derivative financial instruments | $ | $( | $( |
December 31, 2023 | December 31, 2022 | |
Commodity receivables(a) | $ | $ |
Other receivables(b) | ||
Total trade receivables | $ | $ |
Allowance for credit losses(c) | ( | ( |
Total trade receivables, net | $ | $ |
December 31, 2023 | December 31, 2022 | |
Other non-current assets | ||
Other non-current assets(a) | $ | $ |
Total other non-current assets | $ | $ |
Other current assets | ||
Prepaid expenses | $ | $ |
Inventory | ||
Total other current assets | $ | $ |
Number of Shares | Total Share Capital | Total Share Premium | |
Balance as of December 31, 2020 | $ | $ | |
Issuance of share capital (equity placement) | |||
Issuance of share capital (equity compensation) | |||
Balance as of December 31, 2021 | $ | $ | |
Issuance of share capital (settlement of warrants) | |||
Issuance of share capital (equity compensation) | |||
Issuance of EBT shares (equity compensation) | |||
Repurchase of shares (EBT) | ( | ||
Repurchase of shares (share buyback program) | ( | ( | |
Balance as of December 31, 2022 | $ | $ | |
Issuance of share capital (equity placement) | |||
Issuance of EBT shares (equity compensation) | |||
Repurchase of shares (share buyback program) | ( | ( | |
Balance as of December 31, 2023 |
Number of Options(a) | Weighted Average Grant Date Fair Value per Share | |
Balance as of December 31, 2020 | $ | |
Granted | ||
Exercised(b) | ( | |
Forfeited | ( | |
Balance as of December 31, 2021 | $ | |
Granted | ||
Exercised(b) | ( | |
Forfeited | ( | |
Balance as of December 31, 2022 | $ | |
Granted | ||
Exercised(b) | ( | |
Forfeited | ( | |
Balance as of December 31, 2023 | $ |
Number of Shares | Weighted Average Grant Date Fair Value per Share | |
Balance as of December 31, 2020 | $ | |
Granted | ||
Vested | ( | |
Forfeited | ( | |
Balance as of December 31, 2021 | $ | |
Granted | ||
Vested | ( | |
Forfeited | ( | |
Balance as of December 31, 2022 | $ | |
Granted | ||
Vested | ( | |
Forfeited | ( | |
Balance as of December 31, 2023 | $ |
Number of Shares | Weighted Average Grant Date Fair Value per Share | |
Balance as of December 31, 2020 | $ | |
Granted | ||
Vested | ||
Forfeited | ( | |
Balance as of December 31, 2021 | $ | |
Granted | ||
Vested | ||
Forfeited | ( | |
Balance as of December 31, 2022 | $ | |
Granted | ||
Vested | ( | |
Forfeited | ( | |
Balance as of December 31, 2023 | $ |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Risk-free rate of interest | |||
Volatility(a) | |||
Correlation with comparator group range |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Options | $ | $( | $ |
RSUs | |||
PSUs | |||
ESPP | |||
Total share-based compensation expense | $ | $ | $ |
Dividend per Share | Record Date | Pay Date | Shares Outstanding | Gross Dividends Paid | ||
Date Dividends Declared | USD | GBP | ||||
November 14, 2022 | $ | £ | March 3, 2023 | March 28, 2023 | $ | |
March 21, 2023 | $ | £ | May 26, 2023 | June 30, 2023 | ||
May 9, 2023 | $ | £ | September 1, 2023 | September 29, 2023 | ||
September 1, 2023 | $ | £ | December 1, 2023 | December 29, 2023 | ||
Paid during the year ended December 31, 2023 | $ | |||||
October 28, 2021 | $ | £ | March 4, 2022 | March 28, 2022 | $ | |
March 22, 2022 | $ | £ | May 27, 2022 | June 30, 2022 | ||
May 16, 2022 | $ | £ | September 2, 2022 | September 26, 2022 | ||
August 8, 2022 | $ | £ | November 25, 2022 | December 28, 2022 | ||
Paid during the year ended December 31, 2022 | $ | |||||
October 29, 2020 | $ | £ | March 5, 2021 | March 26, 2021 | $ | |
March 8, 2021 | $ | £ | May 28, 2021 | June 24, 2021 | ||
April 30, 2021 | $ | £ | September 3, 2021 | September 24, 2021 | ||
August 5, 2021 | $ | £ | November 26, 2021 | December 17, 2021 | ||
Paid during the year ended December 31, 2021 | $ |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Balance at beginning of period | $ | $ | $ |
Additions(a) | |||
Accretion | |||
Asset retirement costs | ( | ( | ( |
Disposals(b) | ( | ( | ( |
Revisions to estimate(c) | ( | ||
Balance at end of period | $ | $ | $ |
Less: Current asset retirement obligations | |||
Non-current asset retirement obligations | $ | $ | $ |
ARO Sensitivity | Scenario 1(a) | Scenario 2(b) |
Discount rate | $( | $ |
Timing | ( | |
Cost | ( |
Present Value of Minimum Lease Payments | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Balance at beginning of period | $ | $ | $ |
Additions(a) | |||
Interest expense(b) | |||
Cash outflows | ( | ( | ( |
Balance at end of period | $ | $ | $ |
Classified as: | |||
Current liability | $ | $ | $ |
Non-current liability | |||
Total | $ | $ | $ |
Right-of-Use Assets | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Balance at beginning of period | $ | $ | $ |
Additions(a) | |||
Depreciation | ( | ( | ( |
Balance at end of period | $ | $ | $ |
Classified as: | |||
Motor vehicles | $ | $ | $ |
Midstream | |||
Buildings and leasehold improvements | |||
Total | $ | $ | $ |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Discount rates range |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Not Later Than One Year | $ | $ | $ |
Later Than One Year and Not Later Than Five Years | |||
Later Than Five Years | |||
Total | $ | $ | $ |
December 31, 2023 | December 31, 2022 | |
Credit Facility (Interest rate of | $ | $ |
ABS I Notes (Interest rate of | ||
ABS II Notes (Interest rate of | ||
ABS III Notes (Interest rate of | ||
ABS IV Notes (Interest rate of | ||
ABS V Notes (Interest rate of | ||
ABS VI Notes (Interest rate of | ||
Term Loan I (Interest rate of | ||
Miscellaneous, primarily for real estate, vehicles and equipment | ||
Total borrowings | $ | $ |
Less: Current portion of long-term debt | ( | ( |
Less: Deferred financing costs | ( | ( |
Less: Original issue discounts | ( | ( |
Total non-current borrowings, net | $ | $ |
December 31, 2023 | December 31, 2022 | |
Not later than one year | $ | $ |
Later than one year and not later than five years | ||
Later than five years | ||
Total borrowings | $ | $ |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Interest expense, net of capitalized and income amounts(a) | $ | $ | $ |
Amortization of discount and deferred finance costs | |||
Other | |||
Total finance costs | $ | $ | $ |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Balance at beginning of period | $ | $ | $ |
Acquired as part of a business combination | |||
Sale of equity interest | ( | ||
Proceeds from borrowings | |||
Repayments of borrowings | ( | ( | ( |
Costs incurred to secure financing | ( | ( | ( |
Amortization of discount and deferred financing costs | |||
Cash paid for interest | ( | ( | ( |
Finance costs and other | |||
Balance at end of period | $ | $ | $ |
December 31, 2023 | December 31, 2022 | |
Trade payables | $ | $ |
Other payables | ||
Total trade and other payables | $ | $ |
December 31, 2023 | December 31, 2022 | |
Other non-current liabilities | ||
Other non-current liabilities | $ | $ |
Total other non-current liabilities | $ | $ |
Other current liabilities | ||
Accrued expenses(a) | $ | $ |
Net revenue clearing(b) | ||
Asset retirement obligations - current | ||
Revenue to be distributed(c) | ||
Total other current liabilities | $ | $ |
Level 1: | Inputs are unadjusted, quoted prices in active markets for identical assets at the measurement date. | ||
Level 2: | Inputs (other than quoted prices included in Level 1) can include the following: |
Level 3: | Unobservable inputs which reflect the Directors’ best estimates of what market participants would use in pricing the asset at the measurement date. |
December 31, 2023 | December 31, 2022 | |
Cash and cash equivalents | $ | $ |
Trade receivables and accrued income | ||
Other non-current assets | ||
Other non-current liabilities(a) | ( | ( |
Other current liabilities(b) | ( | ( |
Derivative financial instruments at fair value | ( | ( |
Leases | ( | ( |
Borrowings | ( | ( |
Total | $( | $( |
December 31, 2023 | December 31, 2022 | |||
Borrowings | Interest Rate(a) | Borrowings | Interest Rate(a) | |
ABS Notes and Term Loan I | $ | $ | ||
Credit Facility | $ | $ |
Credit Facility Interest Rate Sensitivity | December 31, 2023 | December 31, 2022 |
+100 Basis Points | $ | $ |
-100 Basis Points | $( | $( |
Not Later Than One Year | Later Than One Year and Not Later Than Five Years | Later Than Five Years | ||
Total | ||||
For the year ended December 31, 2023 | ||||
Trade and other payables | $ | $ | $ | $ |
Borrowings | ||||
Leases | ||||
Other liabilities(a) | ||||
Total | $ | $ | $ | $ |
For the year ended December 31, 2022 | ||||
Trade and other payables | $ | $ | $ | $ |
Borrowings | ||||
Leases | ||||
Other liabilities(a) | ||||
Total | $ | $ | $ | $ |
Natural gas (MMcf) | |
2024 | |
2025 | |
2026 | |
Thereafter |
Description | Footnote |
Acquisitions and Divestitures | Note 5 |
Dividends | Note 18 |
Natural Gas | NGLs | Oil | Total | |
(MMcf) | (MBbls) | (MBbls) | (MMcfe) | |
December 31, 2020 | 2,860,792 | 60,206 | 4,760 | 3,250,588 |
Revisions of previous estimates(a) | 498,927 | 4,045 | 3,052 | 541,509 |
Extensions, discoveries and other additions | — | — | — | — |
Production | (234,643) | (3,558) | (592) | (259,543) |
Purchase of reserves in place(b) | 1,019,944 | 32,698 | 7,397 | 1,260,514 |
Sales of reserves in place(c) | (135,983) | (4,311) | (365) | (164,039) |
December 31, 2021 | 4,009,037 | 89,080 | 14,252 | 4,629,029 |
Revisions of previous estimates(a) | 306,696 | 11,694 | 492 | 379,812 |
Extensions, discoveries and other additions | 13,098 | 1 | 37 | 13,326 |
Production | (255,597) | (5,200) | (1,554) | (296,121) |
Purchase of reserves in place(b) | 281,345 | 6,356 | 1,927 | 331,043 |
Sales of reserves in place(c) | (4,968) | — | (324) | (6,912) |
December 31, 2022 | 4,349,611 | 101,931 | 14,830 | 5,050,177 |
Revisions of previous estimates(a) | (658,917) | 153 | (230) | (659,379) |
Extensions, discoveries and other additions | 712 | — | 50 | 1,012 |
Production | (256,378) | (5,832) | (1,377) | (299,632) |
Purchase of reserves in place(b) | 105,713 | 2,592 | 923 | 126,803 |
Sales of reserves in place(c) | (340,697) | (3,143) | (1,580) | (369,035) |
December 31, 2023 | 3,200,044 | 95,701 | 12,616 | 3,849,946 |
Natural Gas | NGLs | Oil | Total | |
(MMcf) | (MBbls) | (MBbls) | (MMcfe) | |
Total proved reserves as of: | ||||
December 31, 2021 | 4,009,037 | 89,080 | 14,252 | 4,629,029 |
December 31, 2022 | 4,349,611 | 101,931 | 14,830 | 5,050,177 |
December 31, 2023 | 3,200,044 | 95,701 | 12,616 | 3,849,946 |
Total proved developed reserves as of: | ||||
December 31, 2021 | 4,008,160 | 89,071 | 13,823 | 4,625,524 |
December 31, 2022 | 4,340,779 | 101,931 | 14,830 | 5,041,345 |
December 31, 2023 | 3,184,499 | 94,391 | 12,380 | 3,825,125 |
Total proved undeveloped reserves as of: | ||||
December 31, 2021 | 877 | 9 | 429 | 3,505 |
December 31, 2022 | 8,832 | — | — | 8,832 |
December 31, 2023 | 15,545 | 1,310 | 236 | 24,821 |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Proved properties | $3,206,739 | $3,062,463 | $2,866,353 |
Unproved properties | — | — | — |
Total capitalized costs | 3,206,739 | 3,062,463 | 2,866,353 |
Less: Accumulated depreciation, depletion and amortization | (716,364) | (506,655) | (336,275) |
Net capitalized costs | $2,490,375 | $2,555,808 | $2,530,078 |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Proved properties | $78,582 | $260,817 | $718,353 |
Unproved properties | — | — | — |
Total property acquisition costs | 78,582 | 260,817 | 718,353 |
Total exploration and development costs | 10,923 | 19,670 | 1,464 |
Capitalized interest | — | — | — |
Total costs | $89,505 | $280,487 | $719,817 |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Natural gas (Mcf) | $2.49 | $6.29 | $3.26 |
NGLs (Bbls) | 21.59 | 43.68 | 29.19 |
Oil (Bbls) | 71.89 | 94.01 | 62.55 |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Future cash inflows | $10,900,742 | $32,155,117 | $16,283,927 |
Future production costs | (5,345,117) | (8,923,660) | (5,773,240) |
Future development costs(a) | (1,937,293) | (1,902,297) | (1,818,190) |
Future income tax expense | (653,216) | (5,001,823) | (1,644,625) |
Future net cash flows | 2,965,116 | 16,327,337 | 7,047,872 |
10% annual discount for estimated timing of cash flows | (1,219,580) | (9,584,237) | (3,714,781) |
Standardized Measure | $1,745,536 | $6,743,100 | $3,333,091 |
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Standardized Measure, beginning of year | $6,743,100 | $3,333,091 | $1,005,307 |
Sales and transfers of natural gas and oil produced, net of production costs | (431,629) | (1,498,272) | (742,375) |
Net changes in prices and production costs | (5,850,625) | 5,137,373 | 2,411,163 |
Extensions, discoveries, and other additions, net of future production and development costs | (13,682) | 28,038 | — |
Acquisition of reserves in place | 122,613 | 555,773 | 980,837 |
Divestiture of reserves in place | (377,097) | (8,303) | (145,434) |
Revisions of previous quantity estimates | (1,224,544) | 702,585 | 609,100 |
Net change in income taxes | 1,688,208 | (1,378,438) | (622,314) |
Changes in estimated future development costs | — | 22,085 | (5,612) |
Previously estimated development costs incurred during the year | — | 7,711 | — |
Changes in production rates (timing) and other | 206,646 | (562,245) | (266,273) |
Accretion of discount | 882,546 | 403,702 | 108,692 |
Standardized Measure, end of year | $1,745,536 | $6,743,100 | $3,333,091 |
Countries | Taxes | Royalties | Total |
United Kingdom | $— | $— | $— |
United States | 88,665 | 4,022 | 92,687 |
Total | $88,665 | $4,022 | $92,687 |
Governments | Taxes | Royalties | Total |
Oil and Gas Authority | $— | $— | $— |
HM Revenue and Customs | — | — | — |
The Crown Estate Scotland | — | — | — |
Total | $— | $— | $— |
Governments | Taxes | Royalties | Total |
Commonwealth of Pennsylvania | $3,100 | $— | $3,100 |
Commonwealth of Virginia | 1,180 | — | 1,180 |
Internal Revenue Service | 14,639 | — | 14,639 |
Office of Natural Resources Revenue | — | 2,238 | 2,238 |
State of Alabama | 134 | — | 134 |
State of Kentucky | 8,090 | — | 8,090 |
State of Louisiana | 16,437 | — | 16,437 |
State of Ohio | 2,363 | — | 2,363 |
State of Oklahoma | 12,140 | 1,473 | 13,613 |
State of Tennessee | 285 | — | 285 |
State of Texas | 19,612 | 311 | 19,923 |
State of West Virginia | 10,685 | — | 10,685 |
Total | $88,665 | $4,022 | $92,687 |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Net income (loss) | $759,701 | $(620,598) | $(325,206) |
Finance costs | 134,166 | 100,799 | 50,628 |
Accretion of asset retirement obligations | 26,926 | 27,569 | 24,396 |
Other (income) expense | (385) | (269) | 8,812 |
Income tax (benefit) expense | 240,643 | (178,904) | (225,694) |
Depreciation, depletion and amortization | 224,546 | 222,257 | 167,644 |
(Gain) loss on bargain purchases | — | (4,447) | (58,072) |
(Gain) loss on fair value adjustments of unsettled financial instruments | (905,695) | 861,457 | 652,465 |
(Gain) loss on natural gas and oil properties and equipment(a) | 20 | 93 | 901 |
(Gain) loss on sale of equity interest | (18,440) | — | — |
Unrealized (gain) loss on investment | (4,610) | — | — |
Impairment of proved properties | 41,616 | — | — |
Costs associated with acquisitions | 16,775 | 15,545 | 27,743 |
Other adjusting costs(b) | 17,794 | 69,967 | 10,371 |
Non-cash equity compensation | 6,494 | 8,051 | 7,400 |
(Gain) loss on foreign currency hedge | 521 | — | 1,227 |
(Gain) loss on interest rate swap | 2,722 | 1,434 | 530 |
Total adjustments | $(216,907) | $1,123,552 | $668,351 |
Adjusted EBITDA | $542,794 | $502,954 | $343,145 |
As of | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Credit Facility | $159,000 | $56,000 | $570,600 |
ABS I Notes | 100,898 | 125,864 | 155,266 |
ABS II Notes | 125,922 | 147,458 | 169,320 |
ABS III Notes | 274,710 | 319,856 | — |
ABS IV Notes | 99,951 | 130,144 | — |
ABS V Notes | 290,913 | 378,796 | — |
ABS VI Notes | 159,357 | 212,446 | — |
Term Loan I | 106,470 | 120,518 | 137,099 |
Other | 7,627 | 7,084 | 9,380 |
Total debt | $1,324,848 | $1,498,166 | $1,041,665 |
LESS: Cash | 3,753 | 7,329 | 12,558 |
LESS: Restricted cash | 36,252 | 55,388 | 19,102 |
Net debt | $1,284,843 | $1,435,449 | $1,010,005 |
Adjusted EBITDA | $542,794 | $502,954 | $343,145 |
Pro forma adjusted EBITDA(a) | $549,258 | $574,414 | $490,978 |
Net debt-to-pro forma adjusted EBITDA(b) | 2.3x | 2.5x | 2.1x |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Total revenue | $868,263 | $1,919,349 | $1,007,561 |
Net gain (loss) on commodity derivative instruments(a) | 178,064 | (895,802) | (320,656) |
Total revenue, inclusive of settled hedges | $1,046,327 | $1,023,547 | $686,905 |
Adjusted EBITDA | $542,794 | $502,954 | $343,145 |
Adjusted EBITDA margin | 52% | 49% | 50% |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Net cash provided by operating activities | $410,132 | $387,764 | $320,182 |
LESS: Expenditures on natural gas and oil properties and equipment | (74,252) | (86,079) | (50,175) |
LESS: Cash paid for interest | (116,784) | (83,958) | (42,673) |
Free cash flow | $219,096 | $217,727 | $227,334 |
Year Ended | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
Total production (MMcfe) | 299,632 | 296,121 | 259,543 |
Total operating expense | $440,562 | $445,893 | $291,213 |
Employees, administrative costs and professional services | 78,659 | 77,172 | 56,812 |
Recurring allowance for credit losses | 8,478 | — | (4,265) |
Adjusted operating cost | $527,699 | $523,065 | $343,760 |
Adjusted operating cost per Mcfe | $1.76 | $1.77 | $1.32 |
As of | |||
December 31, 2023 | December 31, 2022 | December 31, 2021 | |
SEC Pricing(a) | |||
PV-10 | |||
Pre-tax (Non-GAAP)(b) | $2,139,690 | $8,825,462 | $4,037,016 |
PV of Taxes | (394,154) | (2,082,362) | (703,925) |
Standardized Measure | $1,745,536 | $6,743,100 | $3,333,091 |
Directors | David E. Johnson (Non-Executive Chairman (Independent upon appointment)) Martin K. Thomas (Non-Executive Vice Chairman) Rusty Hutson, Jr. (Chief Executive Officer) David J. Turner, Jr. (Independent Non-Executive Director) Sandra M. Stash (Independent Non-Executive Director) Kathryn Z. Klaber (Independent Non-Executive Director) Sylvia Kerrigan (Senior Independent Non-Executive Director) | |
Registered Number | 09156132 (England and Wales) | |
Registered Office | 4th floor Phoenix House 1 Station Hill Reading, Berkshire, RG1 1NB United Kingdom | |
Headquarters | 1600 Corporate Drive Birmingham, Alabama 35242 United States | |
Company Secretary | Apex Secretaries LLP 6th Floor 140 London Wall London EC2V 5DN United Kingdom | |
Independent Auditors, United Kingdom | PricewaterhouseCoopers LLP 1 Embankment Place London WC2N 6RH United Kingdom | |
Independent Registered Public Accounting Firm, United States | PricewaterhouseCoopers LLP 569 Brookwood Village #851 Birmingham, AL 35209 United States | |
Legal Advisor, United Kingdom | Latham & Watkins (London) LLP 99 Bishopsgate London ECM2 3XF United Kingdom | |
Legal Advisor, United States | Benjamin Sullivan, Senior Executive Vice President and Chief Legal & Risk Officer 414 Summers Street Charleston, WV 25301 United States | |
Competent Person | Netherland, Sewell & Associates, Inc. 2100 Ross Avenue, Suite 2200 Dallas, Texas 75201 United States | |
Share Registrar | ComputerShare Investor Services PLC The Pavilions, Bridgewater Road Bristol, BS13 8AE United Kingdom | |
Brokers | Tennyson Securities 23rd Floor, 20 Fenchurch Street London EC3M 3BY United Kingdom Stifel Nicolaus Europe Limited 150 Cheapside London, EC2V 6ET United Kingdom | Peel Hunt LLP 7th Floor, 100 Liverpool Street London EC2M 2AT United Kingdom |
Exhibit No. | Incorporated by reference (File No. 001-41870, unless otherwise indicated) | ||||
Description | Form | Exhibit | Filing Date | ||
1.1 | (c) | 20FR12B | 1.1 | 11/16/2023 | |
1.2 | (c) | 20FR12B | 1.2 | 11/16/2023 | |
2.1 | (c) | 20FR12B | 2.1 | 11/16/2023 | |
4.1 | (c)(f) | 20FR12B | 4.1 | 11/16/2023 | |
4.2 | (c)(f) | 20FR12B | 4.2 | 11/16/2023 | |
4.3 | (c)(f) | 20FR12B | 4.3 | 11/16/2023 | |
4.4 | (c)(f) | 20FR12B | 4.4 | 11/16/2023 | |
4.5 | (c)(f) | 20FR12B | 4.5 | 11/16/2023 | |
4.6 | (c)(f) | 20FR12B | 4.6 | 11/16/2023 | |
4.7 | (c)(f) | 20FR12B | 4.7 | 11/16/2023 | |
4.8 | (c)(f) | 20FR12B | 4.8 | 11/16/2023 | |
4.9 | (c)(f) | 20FR12B | 4.9 | 11/16/2023 | |
4.10 | (c)(f) | 20FR12B | 4.10 | 11/16/2023 | |
4.11 | (c)(f) | 20FR12B | 4.11 | 11/16/2023 | |
4.12 | (c)(f) | 20FR12B | 4.12 | 11/16/2023 | |
4.13 | (c)(f) | 20FR12B | 4.13 | 11/16/2023 | |
Exhibit No. | Incorporated by reference (File No. 001-41870, unless otherwise indicated) | ||||
Description | Form | Exhibit | Filing Date | ||
4.14 | (c)(f) | 20FR12B | 4.14 | 11/16/2023 | |
4.15 | (c)(f) | 20FR12B | 4.15 | 11/16/2023 | |
4.16 | (c)(f) | 20FR12B | 4.16 | 11/16/2023 | |
4.17 | (c)(f) | 20FR12B | 4.17 | 11/16/2023 | |
4.18 | (c)(f) | 20FR12B | 4.18 | 11/16/2023 | |
4.19 | (c)(f) | 20FR12B | 4.19 | 11/16/2023 | |
4.20 | (c)(f) | 20FR12B | 4.20 | 11/16/2023 | |
4.21 | (c)(f) | 20FR12B | 4.21 | 11/16/2023 | |
4.22 | (c)(f) | 20FR12B | 4.22 | 11/16/2023 | |
4.23 | (c)(f) | 20FR12B | 4.23 | 11/16/2023 | |
4.24 | (c)(e)(f) | 20FR12B | 4.24 | 11/16/2023 | |
4.25 | (c)(e)(f) | 20FR12B | 4.25 | 11/16/2023 | |
4.26 | (c)(e)(f) | 20FR12B | 4.26 | 11/16/2023 | |
4.27 | (c)(e)(f) | 20FR12B | 4.27 | 11/16/2023 | |
4.28 | (c)(e)(f) | 20FR12B | 4.28 | 11/16/2023 | |
4.29 | (c)(e)(f) | 20FR12B | 4.29 | 11/16/2023 | |
Exhibit No. | Incorporated by reference (File No. 001-41870, unless otherwise indicated) | ||||
Description | Form | Exhibit | Filing Date | ||
4.30 | (c)(e)(f) | 20FR12B | 4.30 | 11/16/2023 | |
4.31 | (c)(e)(f) | 20FR12B | 4.31 | 11/16/2023 | |
4.32 | (c)(d) | 20FR12B | 4.32 | 11/16/2023 | |
4.33 | (c)(d) | 20FR12B | 4.33 | 11/16/2023 | |
4.34 | (c) | 20FR12B | 4.34 | 11/16/2023 | |
4.35 | (c) | 20FR12B | 4.35 | 11/16/2023 | |
8.1 | (a) | ||||
12.1 | (a) | ||||
13.1 | (b) | ||||
15.1 | (a) | ||||
15.2 | (a) | ||||
15.3 | (a) | ||||
99.1 | (a) | ||||
101 | Inline XBRL data files. | ||||
104 | Cover page inline interactive data file (formatted as Inline XBRL and contained in Exhibit 101). |
/s/ Robert Russell (“Rusty”) Hutson, Jr. |