Diamondback Energy : November 2023 Investor Presentation

Investor Presentation

November 2023

Forward-Looking Statements and Non-GAAP Financial Measures

Forward-Looking Statements

This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, which involve risks, uncertainties, and assumptions. All statements, other than statements of historical fact, that Diamondback Energy, Inc. ("Diamondback," the "Company" or we) makes, including statements regarding future performance; business strategy; future operations (including drilling plans and capital plans); estimates and projections of revenues, losses, costs, expenses, returns, cash flow, and financial position; reserve estimates and its ability to replace or increase reserves; anticipated benefits of strategic transactions (including acquisitions and divestitures); and plans and objectives of management (including plans for future cash flow from operations and for executing on environmental strategies and targets) are forward-looking statements. When used in this presentation, the words "aim," "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "future," "guidance," "intend," "may," "model," "outlook," "plan," "positioned," "potential," "predict," "project," "seek," "should," "target," "will," "would," and similar expressions (including the negative of such terms) as they relate to the Company are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Although The Company believes that the expectations and assumptions reflected in its forward-looking statements are reasonable as and when made, they involve risks and uncertainties that are difficult to predict and, in many cases, beyond the Company's control. Accordingly, forward-looking statements are not guarantees of future performance and the Company's actual outcomes could differ materially from what the Company has expressed in its forward-looking statements.

Factors that could cause the outcomes to differ materially include (but are not limited to) the following: changes in supply and demand levels for oil, natural gas, and natural gas liquids, and the resulting impact on the price for those commodities; the impact of public health crises, including epidemic or pandemic diseases, and any related company or government policies or actions; actions taken by the members of OPEC and Russia affecting the production and pricing of oil, as well as other domestic and global political, economic, or diplomatic developments, including any impact of the ongoing war in Ukraine on the global energy markets and geopolitical stability; concerns over a potential economic slowdown or recession; instability in the financial sector; inflationary pressures; rising interest rates and their impact on the cost of capital; regional supply and demand factors, including delays, curtailment delays or interruptions of production, or governmental orders, rules or regulations that impose production limits; federal and state legislative and regulatory initiatives relating to hydraulic fracturing, including the effect of existing and future laws and governmental regulations; physical and transition risks relating to climate change; and the risks and other factors disclosed in the Company's filings with the Securities and Exchange Commission, including its Forms 10-K,10-Q and 8-K, which can be obtained free of charge on the Securities and Exchange Commission's web site at http://www.sec.gov.

In light of these factors, the events anticipated by the Company's forward-looking statements may not occur at the time anticipated or at all. Moreover, the Company operates in a very competitive and rapidly changing environment and new risks emerge from time to time. The Company cannot predict all risks, nor can it assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those anticipated by any forward-looking statements it may make. Accordingly, you should not place undue reliance on any forward-looking statements made in this presentation. All forward-looking statements speak only as of the date of this presentation or, if earlier, as of the date they were made. The Company does not intend to, and disclaims any obligation to, update or revise any forward-looking statements unless required by applicable law.

The presentation also contains the Company's updated capital expenditure and production guidance, and certain forward-looking information, with respect to 2023. The actual levels of production, capital expenditures, expenses and other estimates may be higher or lower than these estimates due to, among other things, uncertainty in drilling schedules, changes in market demand and unanticipated delays in production. These estimates are based on numerous assumptions, including assumptions related to number of wells drilled, average spud to release times, rig count, and production rates for wells placed on production. All or any of these assumptions may not prove to be accurate, which could result in actual results differing materially from estimates. If any of the rigs currently being utilized or intended to be utilized becomes unavailable for any reason, and the Company is not able to secure a replacement on a timely basis, we may not be able to drill, complete and place on production the expected number of wells. Similarly, average spud to release times may not be maintained in 2023. No assurance can be made that new wells will produce in line with historic performance, or that existing wells will continue to produce in line with expectations. The Company's ability to fund its 2023 and future capital budgets is subject to numerous risks and uncertainties, including volatility in commodity prices and the potential for unanticipated increases in costs associated with drilling, production and transportation. In addition, its production estimate assumes there will not be any new federal, state or local regulation of portions of the energy industry in which the Company operates, or an interpretation of existing regulation, that will be materially adverse to its business. For additional discussion of the factors that may cause it not to achieve its production estimates, see the Company's filings with the SEC, including its forms 10-K,10-Q and 8-K and any amendments thereto. The Company does not undertake any obligation to release publicly the results of any future revisions it may make to this prospective data or to update this prospective data to reflect events or circumstances after the date of this presentation. Therefore, you are cautioned not to place undue reliance on this information.

Non-GAAP Financial Measures

Consolidated Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted EBITDA as net income (loss) attributable to Diamondback Energy, Inc., plus net income (loss) attributable to non-controlling interest ("net income (loss)") before non-cash (gain) loss on derivative instruments, net, interest expense, net, depreciation, depletion, amortization and accretion, depreciation and interest expense related to equity method investments, impairment and abandonments related to equity method investments, (gain) loss on extinguishment of debt, non-cashequity-based compensation expense, capitalized equity-based compensation expense, merger and integration expense, other non-cash transactions and provision for (benefit from) income taxes, if any. Consolidated Adjusted EBITDA is not a measure of net income as determined by United States' generally accepted accounting principles ("GAAP"). Management believes Consolidated Adjusted EBITDA is useful because the measure allows it to more effectively evaluate the Company's operating performance and compare the results of its operations from period to period without regard to its financing methods or capital structure. The Company adds the items listed above to net income (loss) to determine Consolidated Adjusted EBITDA because these amounts can vary substantially from company to company within its industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. Consolidated Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income as determined in accordance with GAAP or as an indicator of the Company's operating performance or liquidity. Certain items excluded from Consolidated Adjusted EBITDA are significant components in understanding and assessing a company's financial performance, such as a company's cost of capital and tax structure, as well as the historic costs of depreciable assets. The Company's computation of Consolidated Adjusted EBITDA may not be comparable to other similarly titled measures of other companies or to such measure in our credit facility or any of our other contracts. For a reconciliation of Consolidated Adjusted EBITDA to net income (loss), and other non-GAAP financial measures, please refer to our earnings release furnished to, and other filings we make with the SEC and the appendix attached to this presentation under "Non-GAAP Definitions and Reconciliations."

Operating cash flow before working capital changes, which is a non-GAAP financial measure representing net cash provided by operating activities as determined under GAAP without regard to changes in operating assets and liabilities. The Company believes operating cash flow before working capital changes is a useful measure of an oil and gas company's ability to generate cash used to fund exploration, development and acquisition activities and serve debt or pay dividends. The Company also uses this measure because adjusted operating cash flow relates to the timing of cash receipts and disbursements that the Company may not control and may not relate to the period in which the operating activities occurred.

Free Cash Flow, which is a non-GAAP financial measure, is cash flow from operating activities before changes in working capital in excess of cash capital expenditures. Adjusted Free Cash Flow, which is a non-GAAP financial measure, is Free Cash Flow adjusted for early termination of commodity derivative contracts. The Company believes that Free Cash Flow and Adjusted Free Cash Flow are useful to investors as it provides a measure to compare both cash flow from operating activities and additions to oil and natural gas properties across periods on a consistent basis. These measures should not be considered as an alternative to, or more meaningful than, net cash provided by operating activities as an indicator of operating performance. The Company's computation of operating cash flow before working capital changes, Free Cash Flow and Adjusted Free Cash Flow may not be comparable to other similarly titled measures of other companies. The Company uses Free Cash Flow to reduce debt, and increase the return of capital to stockholders as determined by the Board of Directors. For reconciliations of net cash provided by operating activities to operating cash flow before working capital changes and to Free Cash Flow and, after adjustments for early settlements of commodity derivative contracts, to Adjusted Free Cash Flow, please refer to our earnings release furnished to, and other filings we make with the SEC and the appendix attached to this presentation under "Non-GAAP Definitions and Reconciliations."

Net debt, which is a non-GAAP measure, is total debt less cash and cash equivalent. Net debt should not be considered an alternative to, or more meaningful than, total debt, the most directly comparable GAAP measure. Management uses net debt to determine the Company's outstanding debt obligations that would not be readily satisfied by its cash and cash equivalents on hand. The Company believes this metric is useful to analysts and investors in determining the Company's leverage position because the Company has the ability to, and may decide to, use a portion of its cash and cash equivalents to reduce debt. For a reconciliation of net debt to total debt, please refer to our earnings release furnished to, and other filings we make with the SEC and the appendix attached to this presentation under "Non-GAAP Definitions and Reconciliations."

Furthermore, this presentation includes or references certain forward‐looking, non‐GAAP financial measures, such as estimated free cash flow for 2023, and certain related estimates regarding future performance, results and financial position. Because the Company provides these measures on a forward‐looking basis, it cannot reliably or reasonably predict certain of the necessary components of the most directly comparable forward‐looking GAAP measures, such as future impairments and future changes in working capital. Accordingly, the Company is unable to present a quantitative reconciliation of such forward‐looking, non‐GAAP financial measures to the respective most directly comparable forward‐looking GAAP financial measures. The Company believes these forward‐looking, non‐GAAP measures may be a useful tool for the investment community in comparing the Company's forecasted financial performance to the forecasted financial performance of other companies in the industry.

Oil and Gas Reserves

The SEC generally permits oil and gas companies, in filings made with the SEC, to disclose proved reserves, which are reserve estimates that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions, and certain probable and possible reserves that meet the SEC's definitions for such terms. The Company discloses only estimated proved reserves in its filings with the SEC. The Company's estimated proved reserves (including those of its consolidated subsidiaries) as of December 31, 2022 referenced in this presentation were prepared by our internal reservoir engineers and audited by Ryder Scott Company, L.P., an independent petroleum engineering firm, and comply with definitions promulgated by the SEC. Additional information on the Company's estimated proved reserves is contained in the Company's filings with the SEC. This presentation also contains the Company's internal estimates of its potential drilling locations, which may prove to be incorrect in a number of material ways. Actual number of locations that may be drilled may differ substantially.

2

3

Disciplined Capital Allocator with Differentiated Returns

Durable Cash Flow Creation through the Cycle

Best-In-Class Execution

Long Life, Pure Play Permian Basin Inventory Base

Investment Grade Balance Sheet

Peer Leading ESG Profile

Disciplined Capital Allocator with Differentiated Returns

Continued Free Cash Flow Generation:

• $820 million of Free Cash Flow ("FCF") in Q3 2023 ($4.58 / share); $884 million of Adjusted FCF ($4.94 / share)(1)(2)
• Expect at least $2.9 billion of FCF in 2023 at current commodity prices(3)

Differentiated Return of Capital:

FANG Return of Capital Framework

Q3 2023 Return of Capital: $663 million ($3.68 / Share)

Primary:Additional:

 Return of ~81% of Q3 2023 FCF and 75% of Adjusted FCF,

resulting in a total return of capital of $663 million

 $4.0 billion authorized share buyback (~$2.3 billion spent to

date)

 Committed to returning at least 75% of FCF through a

combination of the base dividend, share repurchases and

Base Dividend

~$151 million

$0.84 / Share

Stock Repurchases

~$56 million

$0.31 / Share

Variable Dividends

~$456 million

$2.53 / Share

variable dividend

Q3 Dividend Declaration:

• Declared base cash dividend of $0.84 per share and variable cash dividend of $2.53 per share, both payable on November 24, 2023(4)
• Total Q3 2023 dividend payout of $3.37 per share implies an 8.3% annualized yield
• Industry-leadingbase dividend growth has resulted in a ~9% average quarterly CAGR since inaugural dividend in 2018

~81% of Q3 2023 Free Cash Flow Returned to Stockholders

Diamondback Market Snapshot

NASDAQ Symbol: FANG

Market Cap: $29,013 million

Net Debt: $5,550 million

Enterprise Value: $35,267 million

Share Count: 179 million

Annual Base Dividend: $3.36 (2.1% current yield)

Total Q3 Dividend: $3.37 (8.3% current yield)

Diamondback continues to return meaningful capital to its stockholders through a sustainable and

growing base dividend, opportunistic share repurchases and variable dividend

4	Source: Company data, public filings, and Bloomberg. Financial data as of 9/30/2023. Market data as of 11/3/2023.
(1)	Free Cash Flow defined as operating cash flow before changes in working capital and dividends, less cash CAPEX.
	(2)	During 3Q23, the Company paid $64 million related to taxable gains on midstream / Deep Blue divestitures. This amount

has been excluded from the FCF computation when determining the capital to be returned to stockholders.

1. Based on strip pricing as of 11/3/2023. We are unable to present a quantitative reconciliation because we cannot reliably predict certain of the necessary components of operating cash flow, such as changes in working capital. See "Forward- Looking Statements and Non-GAAP Financial Measures" on slide 2 for additional cautionary information.
2. Future dividends subject to the discretion and approval of the Board of Directors.

Third Quarter Highlights

Investment Framework and Q3 2023 Results

Maintain Oil Volumes

• Oil production of 266.1 Mbo/d (452.8 Mboe/d)
• Oil production per million shares of 1,488 Bo/d, up 16% year over year

Execute with Best-in-Class Cost Structure

• Unhedged realized cash margin of 79%(1)
• Cash CAPEX of $684 million, down 4% quarter over quarter
• Reinvestment rate of 45%, down 20% quarter over quarter

Q3 2023 Execution

	Q2 2023			Q3 2023
Oil Production per
Million Shares	1,459			1,488
Net Mbo/d

Realized Cash Margin
		79%
74%
% of Unhedged Price
Reinvestment Rate
57%
	45%
Cash CAPEX / Cash Flow (%)

Generate Significant Free Cash Flow

• Operating cash flow before working capital changes of $1.5 billion ($8.41 / share)
• Generated $820 million of FCF ($4.58 / share)(2)
• Generated $884 million of Adjusted FCF ($4.94 / share)(3)
• Returned ~81% of FCF back to stockholders
• Declared company record total dividend payout of $3.37 / share ($0.84 / share base dividend; $2.53 / share variable dividend)

Free Cash Flow			$4.58
$3.03
$ / Share

Adjusted Free Cash Flow			$4.94
$3.03
$ / Share

Strengthen Balance Sheet

• As previously announced, completed joint venture transaction with Five Point Energy LLC, consisting of certain Midland Basin water assets for gross proceeds of $516 million and 30% equity ownership in the new joint venture entity, Deep Blue Midland Basin LLC
• Since initiating our non-core asset sale program, have closed transactions with $1.7 billion of gross proceeds, exceeding our year-end 2023 target of $1.0 billion

Net Debt(4)	$6,676
	$5,550
$MM
Net Debt / LTM Adjusted
1.03x
	0.87x
EBITDA(5)

Source: Company data, filings and estimates.

5 (1) Unhedged cash margin calculated as the sum of unhedged realized price per boe less cash operating costs including interest per boe divided by the unhedged realized price per boe.

1. Free cash flow defined as operating cash flow before changes in working capital and dividends, less cash CAPEX.

1. During 3Q23, the Company paid $64 million related to taxable gains on midstream / Deep Blue divestitures. This amount has been excluded from the FCF computation when determining the capital to be returned to stockholders.
2. Consolidated total debt less cash and cash equivalents as of 9/30/2023.
3. Net debt / LTM Adjusted EBITDA calculated as consolidated net debt as of 9/30/2023 divided by LTM consolidated adjusted EBITDA.

Overview of 2023 Guidance

2023 Activity and Guidance Midpoints vs 2022

2023 Production and Activity Outlook

2022A		2023 YTD		2023
		Guidance

Oil Production
Net Mbo/d	224		260		263
Oil Production / Share(1)
Net Mbo/d per MM	1,267		1,443		1,461
Base Dividend

263

Mbo/d

16.5

19.0

Lario

Outperformance /

FireBird

(Feb. 23+)

Organic Growth

220

269 - 273

Mbo/d

Mbo/d

FANG

Q4

FY

Run-rate

2023 Guidance

Mbo/d

FY 2023 Activity

340 - 350

Gross operated wells drilled

325 - 335

Gross operated wells TIL

~85%

Midland Basin net lateral ft.

$ / Share - Annually	$3.00				$3.36
Capital Budget / TIL
Lateral Feet(2)(3)	$779				$786
$ / Ft.
TIL Lateral Feet(3)
Net Ft. (1,000's)	2,488		2,623		3,410
Drilled Lateral Feet
				3,416
Net Ft. (1,000's)	2,502		2,698

110

100

90

80

70

60

50

							2023 Capital Guidance
				Drilled Wells		TIL Wells		CAPEX ($MM)
								FY 2023 Capital Guidance
					98									$2.66 - $2.70B
87	89	86							FY 2023 Cash CAPEX
82									79 80			$610 - $650MM
							74
											Q4 2023 Cash CAPEX
$657		$711		$684	~$630			-8%
								Q4 CAPEX Guidance vs. Q3A
	Q1 2023	Q2 2023	Q3 2023	Q4 2023
										Guidance Midpoint

6	Source: Company data, filings and estimates.
(1)	Assumes FANG's current implied FY2023 weighted average share count of approximately 180 million shares.
	(2)	Capital budget includes spending for operated drill, complete and equip ("D,C&E"), non-operated properties and capital workovers, midstream and infrastructure; excludes equity method investments and acquisitions.
	(3)	Turned in line ("TIL") lateral feet.

Return of Capital Framework

• Diamondback's return of capital strategy is underpinned by a sustainable and growing base dividend, as well as additional return of capital from a combination of share repurchases and/or variable dividends
• Our strategy gives us the flexibility to pivot to share repurchases when share price weakens
• Current $3.36 / share base dividend protected down to ~$40 / Bbl WTI oil price with downside hedge protection at $55 oil(1)
• Base dividend viewed as a fixed obligation to stockholders, like interest expense to bondholders

Illustrative Base Dividend Breakeven

Upside

Exposure

			Oil Price(1)
Current Hedges			~$55 / Bbl
			~$43 / Bbl
Base Dividend
		~$40 / Bbl
$3.36 / share
	Current		~$32 / Bbl
Maintenance	Costs	Mid-Cycle
CAPEX(3)

Return of Capital Framework Execution and Priorities

1 Sustainable and Growing Base Dividend

Quarterly base dividend of $0.84 / share ($3.36 annual) Current base dividend protected down to ~$40 / Bbl WTI(1)

2	Opportunistic	Repurchases

$4.0 billion authorized program (~$2.3 billion repurchased to date)

Repurchased ~18.4 million shares since Q3 2021 (10.2% of starting share count)

Repurchased ~5.6 million shares YTD for $741 million

3	Variable Dividends

Make-whole provision for remaining quarter FCF after base dividend and stock repurchases (if less than 75%)

75%+ of Free Cash Flow Returned to Stockholders(2)

	Since its initiation in 2018, Diamondback's primary form of returning capital to stockholders remains its sustainable
		and growing base dividend, which it believes is protected down to ~$40/Bbl oil prices
	Source: Company data, filings and estimates.
7	(1)	Breakeven WTI oil price calculated as the per barrel price for oil needed to generate cash flow equivalent with the amount of capital required to keep its estimated Q4 2023 oil production flat in 2024. Assumes $3.00/Mcf Henry Hub gas prices and $20/Bbl
	NGL prices; excludes the impact of current commodity hedges.
	(2)	Free cash flow calculated as operating cash flow before changes in working capital and dividends, less cash CAPEX (defined below).
	(3)	Maintenance CAPEX defined as estimated capital required to keep estimated Q4 2023 oil production flat throughout the full year 2024.

Return of Capital History and Highlights

Declared Base Dividends Since 2018 ($ / Share)

+5.7x Base Dividend Growth ~9% average quarterly CAGR

					$3.0000	$3.2000	$3.3600
		$1.5250	$1.9500	$0.8000
	$0.9375	$0.6000	$0.7500
	$0.4000
$0.5000	$0.5000	$0.7500
$0.3750	$0.3750
	$0.3750	$0.4500
	$0.1875	$0.7000
	$0.1875	$0.3750	$0.4000
	$0.1875
2018	2019	2020	2021		2022	Q1 2023	Current
						Run-RateRun-Rate
		Q1	Q2	Q3	Q4

$4.0 Billion Authorized Stock Repurchase Program(1)

Stock Repurchases ($MM) Cumulative Shares Repurchased (MM)

18.4 $2,269

12.8$741

6.6$788

4.1	$309	Stock Repurchase Program:
	~18.4MM shares repurchased
$431		(10.2% of starting share count)
	~$1.7B of $4.0B remaining
2H 2021	1H 2022	2H 2022	YTD 2023	Cumulative

Cumulative Return of Capital Paid Since Inaugural Base Dividend

$7,000

$6,000

$5,000

$4,000

$3,000

$2,000

$1,000

$0

					Base Dividends ($MM)			Variable Dividend ($MM)			Stock Repurchases ($MM)	DPS - Paid					$6,683
														$1,550	$6,044
											$2,670
											$4.620								$21.264
																$17.894
						$334	$743	$1.750	$8.960
	$0.375	$710	$0.689	$1.500
$37
2018		2019			2020	2021		2022	YTD 2023		Paid to date(2)			Q4 2023(3)

$24

$21

$18

$15

$12

$9

$6

$3

$0

		Diamondback's Return of Capital strategy is focused on a sustainable growing base dividend, opportunistic share
		repurchases and variable dividends, through which it has returned over $6.0 billion to stockholders since 2018
	Source: Company data, filings and estimates.
8 (1)	Stock repurchases through 11/3/2023.
(2)	Paid Return of Capital through 9/30/2023.
(3)	Pro forma for declared Q3 2023 dividends and stock repurchases to date in Q4 2023.

Durable Cash Flow Creation through the Cycle

Illustrative 2023E Consolidated Free Cash Flow at Various WTI Oil Prices ($MM)(1)

YTD FCF		Base Dividend		Additional ROC		Remaining FCF	FCF Yield (EV)	FCF Yield (Market Cap)

FY 2023 Assumptions

~263 Mbo/d

Oil Production

$2.66 - $2.70 billion

Cash CAPEX(2)

>95%

% of WTI Realized ($/Bbl)

$20/Bbl / $3.00/Mcf

Unhedged NGL / Gas Prices

$3.36 / Share

Annual Base Dividend

75%+ of FCF

Total Return of Capital

	$4,000
	$3,000
($MM)	$2,000
Cash Flow
Free	$1,000
	$0

			$2,900+	$3,100+			25%
					20%
		$2,700+
								(3)
	$2,013							15%
							(%)
								Yield
								10%
								FCF
								5%
								0%
	2023 YTD	$70 / Bbl		$80 / Bbl	$90 / Bbl
			Consolidated 2023E Free Cash Flow
	FCF / Share(3)	$15.03	$16.14	$17.26
	2023E Return Yield	7.4%		7.9%	8.4%
	(Market Cap)(4)
	2023E Return Yield	6.0%		6.5%	6.9%
	(EV)(4)

At current commodity prices, Diamondback expects to generate at least $2.9 billion of Free Cash Flow and return over $2.2 billion to stockholders through a combination of our base-plus-variable dividend and share repurchases

Source: Company data, filings and estimates. Note: All 2023E scenarios incorporate identical activity levels, capital spending, production, respectively; assumes current cash operating costs, and well costs; and incorporate current hedges. See also "Forward-Looking Statements and Non-GAAP Financial Measures" slide above.

1. Free Cash Flow calculated as operating cash flow before changes in working capital and dividends, less cash CAPEX (defined below). Based on the same assumptions, illustrative 2023E consolidated operating cash flow would be over $5,380MM at $70/Bbl, over $5,580MM at $80/Bbl, and over $5,780MM at $90/Bbl. We are unable

9	to present a quantitative reconciliation because we cannot reliably predict certain of the necessary components of operating cash flow, such as changes in working capital. See "Forward-Looking Statements and Non-GAAP Financial Measures" on slide 2 for additional cautionary information.

1. FY 2023 Assumptions: Oil production of ~263 Mbo/d; $2.660 - $2.700 billion cash capex, defined as capital spending for operated D,C&E, non-operated properties and capital workovers, midstream and infrastructure; excludes equity method investments and acquisitions; Unhedged NGL realization equal to $20/Bbl; $3.00/Mcf.
2. Free Cash Flow per share assumes FANG's current implied FY2023 weighted average share count of approximately 180 million shares. Free cash flow yield calculated as free cash flow divided by FANG's enterprise value ("EV") and FANG's market capitalization ("Market Cap") as of 11/3/2023, respectively.
3. Return yield calculated as 2023E % of free cash flow to be returned divided by FANG's enterprise value ("EV") and FANG's market capitalization ("Market Cap") as of 11/3/2023, respectively.

Track Record of Cost Control and Consistent Execution

Midland Basin Avg. Drilling Days to Total Depth by Year

	24			2019		2020	2021		2022	2023
	20
Days	16
12
Avg.
8
	4
	0
	0	2	4	6	8	10	12	14	16	18	20	22	24	26

Depth (1,000's of Ft.)

Midland Basin SimulFRAC Completion Efficiency

		Avg. Ft. / Day	Avg. Proppant / Day (1,000's)

3,500'			~2,700'	~3,000'	7,500
3,000'		~2,500'
2,500'				~5,700 6,000
2,000'	~1,500'		~5,200
~4,700
1,500'				4,500
1,000'	~2,800				3,000
500'
0'					1,500

Zipper Frac

2019 - 2021 Avg.

SimulFRAC used on ~90% of wells

Historical Midland Basin Drilling and Completion Cost Components vs. Q4 2022

140%

Major Drilling Cost Components

8%
Directional	Cement	Rig
Directional	Cement	Rig

100%

Q1 2023 Q2 2023 Q3 2023 Q4 2023E

Casing	Drill-Out
Casing	Drill-Out

Major Completion Cost Components

Fuel	Water	Stimulation
Fuel	Water	Stimulation

										% Change from
		-5%		-2%			Q4 2022 Baseline				-20%	-12%
											-11%	-18%
									-20%
										% of Q3 2023
	3%		4%		6%			16%		5%		5%		6%		27%
						Average Well Cost

Diamondback continues to maximize efficiency by consistently drilling wells faster and completing

more lateral feet per day

Source: Company data and estimates as of 11/3/2023.

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