Careers in Investments - Dallas TexasKnowledge-Based Economy Adjusted R2 from regression of companies’ market value on their sales, cost of sales, SG&A, earnings, assets, and liabilities,

Careers in Investments

Portfolio Manager (PM)

Which valuation approach do you use?

Valuation approach Yes

If yes,

% of

cases

Market Multiples 93% 69%

DCF 79% 60%

Asset Based 61% 37%

Real Options 5% 21%

Knowledge-Based Economy

Components of S&P 500 Market Value100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

1975 1985 1995 2005 2015

Tangible assetsIntangible assets

Knowledge-Based Economy

Adjusted R2 from regression of companies’ market value on their sales,

cost of sales, SG&A, earnings, assets, and liabilities, 1950–2015

100%

90%

80%

70%

60%

50%

40%

1950 1960 1970 1980 1990 2000 2010

Year

Importance of Industry in Valuation

Does your selection of valuation methods

depend on the industry or economic sector in

which the company operates?

Yes – 68%

No – 32%

Energy is Different!

ESG Data Is Increasingly Available

).

Cumulative ESG data points available from Bloomberg for 453 select metrics

7,000,000

6,000,000

5,000,000

4,000,000

3,000,000

2,000,000

1,000,000

0

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016*

But Is the Data Decision-Useful?

E&S data availability by metric type, MSCI ACWI constituents

350,000

300,000

250,000

200,000

150,000

100,000

50,000

75%

68%

120%

Num

be

r o

f d

ata

po

ints

Total metrics Policy Numeric

2007 2015

0

What Works in the Energy Sector?

Overweighting Top ESG Ratings?

Increase in Return = 0%

Increase in Sharpe Ratio = 0.01

Decrease in Max Drawdown = -2.5%

What Works in the Energy Sector?

Overweighting Top ESG Ratings?

Increase in Return = 0%



Avoiding Bottom ESG Ratings? Increase in Return = 0.7%



February 12, 2020

The Environmental Partnership

ENERCOM DALLAS


MissionContinuously improve the industry’s environmental performance by taking action,

learning about best practices and technologies, and fostering collaboration in order to responsibly develop our nation’s essential oil and natural gas resources.

Three Program Principles

• Companies implement environmental performance programs that are cost-effective, commercially proven, and achieve significant emissions reductions

Take Action

• Host industry workshops to foster operator-to-operator information sharing about best practices and new technologies

Learn

• Host conferences to promote dialogue with stakeholder groups to share information on new academic research, program learnings, and new technological developments

Collaborate

Building Broad & Diverse Participation

Continued Focus on Recruitment

The Partnership has more than doubled to 70 companies

…and growing

Participating Companies 1. Aera Energy

2. Aethon Energy

3. Alta Resources

4. American Petroleum Partners

5. Antero Resources

6. Apache

7. Ascent Resources

8. BHP

9. BP

10. Cabot Oil and Gas

11. California Resources Corporation

12. Callon Petroleum

13. Chesapeake

14. Chevron

15. Cimarex

16. ConocoPhillips

35. JKLM Energy

36. Lime Rock Resources

37. Marathon Oil

38. Murphy Oil

39. Noble Energy

40. Oasis Petroleum

41. Occidental Petroleum

42. Olympus Energy

43. Ovintiv

44. Parsley Energy

45. PDC Energy

46. Penn General Energy

47. PennEnergy Resources

48. Pioneer Natural Resources

49. QEP Resources

50. Range Resources

51. Red Bluff Resources

52. Repsol

17. Continental Resources

18. CrownQuest

19. Denbury Resources

20. Devon

21. Enerplus

22. EOG Resources

23. EQT

24. Equinor

25. Equitrans Midstream

26. Extraction Oil & Gas

27. ExxonMobil

28. Fieldwood Energy

29. Flywheel Energy

30. Gulfport Energy

31. Hess

32. HighPoint Resources

33. Hunt Oil Company

34. Inidgo Resources

53. Riviera Resources

54. Sable Permian Resources

55. Seneca Resources

56. Sequitur Energy

57. Shell

58. SM Energy

59. Southwestern

60. Summit Discovery Resources

61. Surge Energy

62. Tallgrass Energy

63. Total

64. Trinity Operating

65. Warwick Energy

66. Western Gas

67. Whiting Petroleum

68. Williams Energy

69. WPX Energy

70. XTO Energy

70 Participating Companies Currently


Taking Action

Emission Sources of Interest

Initial focus is the further reduction of air emissions, both methane and volatile organic compounds, from oil and natural gas sector.

Focus on highest emitting sources:

• Equipment Leaks

• High-Bleed Pneumatic Controllers

• Liquids Unloading

Environmental Performance Programs

To address top-emitting sources, participating companies will implement the following Environmental Performance Programs in a manner that best suits their unique operations:

1. Detection and timely repair of leaking equipment using optical gas imaging cameras, portable analyzers, or equivalent technology

2. Replacement or retrofitting of high-bleed pneumatic controllers with lower-emitting or zero-bleed controllers

3. Implementation of a best practice to minimize emissions by monitoring manual liquids unloading events

Leak Detection and Repair Program

2018 Highlights

Controller and Liquids Unloading Programs

2018 Highlights


Learning

Industry-Focused Workshops

• As part of the program’s “Learning” principle, The Partnership provides opportunities for companies to come together to share operational knowledge and best practices.

• The Partnership hosted two workshops in 2018:

• Canonsburg, PA for Appalachian operators (July 26th)

• Odessa, TX for Permian Basin operators (April 4th)

• The Partnership hosted three workshops in 2019:

• Midland, TX (April 9th)

• Oklahoma City, OK (April 11th)

• Dickinson, ND (July 25th)

• The Partnership will host multiple workshops across the country in 2020, starting with Midland Texas in March.


Collaborating

2019 Annual Conference – “The Field of the Future”

• Each year, The Partnership hosts an annual conference to foster collaboration between industry operators and the organizations developing, testing, and implementing cutting-edge technology and techniques that are further reducing our environmental footprint.

• The 2019 Annual Conference was held in Houston, Texas and we will return to Houston for the 2020 Annual Conference.

Annual Conference Presenters

Program Collaboration since 2018 – CSU Energy Institute

• As part of the program’s goal to advance the development of new technologies, funding was approved to support a study at Colorado State University’s METEC site.

• METEC is a testing site that models natural gas facilities for researchers to test low-cost methane sensing technologies.

• Funding allowed participating companies to send their optical gas imaging camera operators to the site and advance the use of new detection technologies in the field.

2019 Annual Report

• The Environmental Partnership’s First Annual Report was released July 30th.

• Please visit www.TheEnvironmentalPartnership.organd click on “Annual Report” to find out more!

For additional information, please contact:

Matthew Todd, Director [email protected]

Cole Ramsey, Program Coordinator [email protected]

http://www.theenvironmentalpartnerhsip.org/

mailto:[email protected]

mailto:[email protected]

Reporting Requirements

• Participating companies agree to annual reporting to track progress.

• Annual reporting due April 30th.

• The Partnership’s programs are purposefully designed to evolve in response to new information that will come from its implementation.

• All reported data is aggregated, and an annual report is developed to document The Partnership’s efforts and made available to the public on our website.

NYSE: HPR

February 12, 2020

ENERCOM ESG PANELKen Wonstolen – SVP & General Counsel

NYSE: HPR 30

All statements in this press release, other than statements of historical fact, are forward-looking statements within the meaning of Section 27A

of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Words such as expects, forecast, guidance, anticipates,

intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking

statements herein; however, these are not the exclusive means of identifying forward-looking statements. Forward-looking statements in this

release relate to, among other things, future production, projects and opportunities.

These and other forward-looking statements in this press release are based on management's judgment as of the date of this release and are

subject to numerous risks and uncertainties. Actual results may vary significantly from those indicated in the forward-looking statements. Please

refer to HighPoint Resources' Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC, and other filings,

including our Current Reports on Form 8-K and Quarterly Reports on Form 10-Q, all of which are incorporated by reference herein, for further

discussion of risk factors that may affect the forward-looking statements. The Company encourages you to consider the risks and uncertainties

associated with projections and other forward-looking statements and to not place undue reliance on any such statements. In addition, the

Company assumes no obligation to publicly revise or update any forward-looking statements based on future events or circumstances. Results

presented for the third quarter of 2019 are preliminary and subject to change as the Company finalizes its financial statements for the quarter.

FORWARD-LOOKING & OTHER CAUTIONARY STATEMENTS

NYSE: HPRNYSE: HPR 31


NYSE: HPR

NYSE: HPR

NYSE: HPR

NYSE: HPR

NYSE: HPR

NYSE: HPR

NYSE: HPR

NYSE: HPRNYSE: HPR

Normalized EHS Performance Statistics 2013 to 2019

0.00

1.00

2.00

3.00

4.00

5.00

6.00

2013 2014 2015 2016 2017 2018 2019

Injuries per 200,000 hrs worked Spills/MMBoe Fires/MMBoe MVI / 200,000 hrs worked

Note: 2017 and prior data is BBC only


Corporate Governance Documents Available on the Company’s Website

NYSE: HPRNYSE: HPR

Proxy Peer Comparison

Company NameEnvironmental Overall

ScoreSocial Overall Score

Industry Group (4-Digit GICS)

PDC Energy, Inc. 6 5 Energy

HighPoint Resources Corp. 7 6 Energy

Contango Oil & Gas Company 7 7 Energy

Callon Petroleum Company 7 8 Energy

Matador Resources Company 7 9 Energy

Abraxas Petroleum Corporation 9 10 Energy

Extraction Oil & Gas, Inc. 10 7 Energy


ISS Climate Awareness Scorecard


New Emphasis on ESG

Source: Wall Street Journal

• Asking companies to publish disclosures aligned with TCFD- and SASB-guidelines by the end 2020

• Will double the number of ESG ETFs it offers and offer sustainable versions of all of its largest index portfolios

• Align engagement goals with the UN Sustainable Development Goals, and will move to quarterly voting disclosure

• Will begin publicly disclosing the topics that it engages with each company on annually

• Will begin voting against the boards of big companies that lag behind on ESG standards

• Will focus on a smaller group of companies that are performing particularly poorly, but beginning in 2022 it will also start voting against the board members of all companies that have consistently underperformed their peers

• Introduced an “R-Factor”, or responsibility score, last year measuring various ESG Metrics

BlackRock

State Street Global Advisors


Pushback is coming…

“…we see labeling based on incomplete information, public shaming and shunning wrapped in moral rhetoric preached with cold-hearted, self-righteous oblivion to the consequences…”

“After all, naming and shaming corporate villains is fun, trendy and profitable”

“In our modern corporate ESG world, there is a group of people who take the lead in instigating their fellow citizens into a frenzy of moral rectitude.”

Source: Pierce, Hester. “Scarlet Letters”


SEC proposed rule would have blocked 614 ESG resolutions since 2010

Source: S&P Global Market Intelligence


NYSE: HPR

555 17th Street, Suite 3700

Denver, Colorado 80202303.293.9100

Website: www.hpres.com

Investor Relations Contact:

Larry C. Busnardo(303) 312.8514 | [email protected]