Civitas Closes Bison Acquisition

DENVER–(BUSINESS WIRE)–Civitas Resources, Inc. (NYSE: CIVI) (“Civitas” or the “Company”), a Colorado energy leader and the state’s first carbon neutral oil & gas producer, today announced that it has closed its previously announced acquisition of privately held Denver-Julesburg Basin (“DJ Basin”) operator Bison Oil & Gas II, LLC (“Bison”). Consideration for the Bison acquisition was modified to reflect an all-cash transaction (no Civitas shares issued), with a total cash outlay by the Company of approximately $300 million, which was funded with cash on hand. The transaction demonstrates Civitas’ disciplined approach to consolidation with a focus on value creation and accretion.

Transaction Highlights

• Strengthens Civitas’ portfolio by adding 102 gross high-quality rural locations, of which 38 are already fully permitted

• Attractive valuation with total consideration at a discount to PDP PV-12 and below 1.6x 2022E EBITDA⁽¹⁾

• Enhances Civitas margins with pro forma 2022E production increase of approximately 9,000 Boed composed of 75% oil and 90% liquids, without incremental G&A expense

• Accretive to Civitas’ Net Asset Value, 2022E production, EBITDA and Free Cash Flow

• Preserves Civitas’ fortress balance sheet, with pro forma net leverage of 0.2x

• Civitas will integrate the Bison properties under its net zero policy, further reducing basin emissions

(1) Based on strip pricing as of February 25^th, 2022

Ben Dell, Civitas’ Chairman and interim CEO, commented: “Civitas continues to demonstrate its commitment to delivering unprecedented value to all of its stakeholders. We firmly believe that the Company is well positioned to continue successfully executing its business plan, with a clear objective of identifying and executing on the highest value-accretive consolidation opportunities.”

Petrie Partners, LLC and RBC Capital Markets, LLC served as financial advisors and Kirkland & Ellis LLP served as legal advisor to Civitas. CIBC Capital Markets served as financial advisor and Bracewell LLP served as legal advisor to Bison.

About Civitas Resources, Inc.

Civitas Resources, Inc. is Colorado’s first carbon neutral oil & gas producer and is focused on developing and producing crude oil, natural gas and natural gas liquids in Colorado’s Denver-Julesburg Basin. The Company is committed to pursuing compelling economic returns and cash flow while delivering best-in-class cost leadership and capital efficiency. Civitas is dedicated to safety, environmental responsibility, and implementing industry leading practices to create a positive local impact. For more information about Civitas, please visit www.civitasresources.com.

Forward-Looking Statements and Cautionary Statements

Certain statements in this press release concerning the credit facility, the results, effects, benefits and synergies of the acquisition of Bison, future opportunities for Civitas, future financial performance and condition, guidance and any other statements regarding Civitas’ future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts are “forward-looking” statements based on assumptions currently believed to be valid. Forward-looking statements are all statements other than statements of historical facts. The words “anticipate,” “believe,” “ensure,” “expect,” “if,” “intend,” “estimate,” “probable,” “project,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “would,” “potential,” “may,” “might,” “anticipate,” “likely” “plan,” “positioned,” “strategy,” and similar expressions or other words of similar meaning, and the negatives thereof, are intended to identify forward-looking statements. Specific forward-looking statements include statements regarding Civitas’ plans and expectations with respect to the merger with Extraction Oil & Gas, Inc., (“Extraction”) and the acquisition of CPPIB Crestone Peak Resources America Inc. (“Crestone Peak”) (the “Transactions”) and the anticipated impact of the Transactions on Civitas’ results of operations, financial position, growth opportunities and competitive position. The forward-looking statements are intended to be subject to the safe harbor provided by Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995.

These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those anticipated, including, but not limited to, potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the acquisition of Bison; the diversion of management time on Transaction-related issues; the ultimate timing, outcome and results of integrating the legacy operations of Civitas; changes in capital markets and the ability of Civitas to finance operations in the manner expected; the effects of commodity prices; the risks of oil and gas activities; and the fact that operating costs and business disruption may be greater than expected following the public announcement or consummation of the Transactions. Additionally, risks and uncertainties that could cause actual results to differ materially from those anticipated also include general economic conditions, whether internationally, nationally or in the regional and local market areas in which we do business; the effects of disruption of our operations or excess supply of oil and natural gas due to the COVID-19 pandemic and the actions by certain oil and natural gas producing countries; the scope, duration and severity of the COVID-19 pandemic, including any recurrence, as well as the timing of the economic recovery following the pandemic; ability of our customers to meet their obligations to us; our ability to generate sufficient cash flow from operations, borrowings, or other sources to enable us to fully develop our undeveloped acreage positions; the presence or recoverability of estimated oil and natural gas reserves and the actual future sales volume rates and associated costs; uncertainties associated with estimates of proved oil and gas reserves; the assumptions underlying forecasts, including forecasts of production, well costs, capital expenditures, rates of return, expenses, cash flow and cash flow from purchases and sales of oil and gas; the possibility that the industry may be subject to future local, state, and federal regulatory or legislative actions (including additional taxes and changes in environmental regulation); environmental risks; seasonal weather conditions; drilling and operating risks, including the risks associated with the employment of horizontal drilling and completion techniques; our ability to acquire adequate supplies of water for drilling and completion operations; availability of oilfield equipment, services, and personnel; exploration and development risks; competition in the oil and natural gas industry; our ability to secure adequate processing capacity for natural gas we produce, to secure adequate transportation for oil, natural gas, and natural gas liquids we produce, and to sell the oil, natural gas, and natural gas liquids at market prices; continued hostilities in the Middle East, South America, and other sustained military campaigns or acts of terrorism or sabotage; and other economic, competitive, governmental, legislative, regulatory, geopolitical, and technological factors that may negatively impact our businesses, operations, or pricing. Expectations regarding business outlook, including changes in revenue, pricing, capital expenditures, cash flow generation, strategies for our operations, oil and natural gas market conditions, legal, economic and regulatory conditions, and environmental matters are only forecasts regarding these matters.

Additional information concerning other risk factors is also contained in Civitas’ most recently filed Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other Securities and Exchange Commission (“SEC”) filings. Additional information concerning Civitas, Extraction and Crestone Peak, the Transactions, and risks relating to the Transactions can be found in the registration statement on Form S-4 filed by Bonanza Creek, Registration No. 333-257882, which was declared effective by the SEC on September 28, 2021. Civitas undertakes no duty to publicly update these statements except as required by law.

Contacts

Investor Relations:

John Wren, ir@civiresources.com

Media:

Brian Cain, info@civiresources.com