California Resources Corporation. (NYSE:CRC) Q3 2023 Earnings Conference Call November 2, 2023 12:00 PM ET Company Participants Joanna Park - Vice President of Investor Relations, Treasurer Francisco Leon - President & Chief Executive Officer Manuela Molina - Executive Vice President & Chief Financial Officer Chris Gould - Executive Vice President & Chief Sustainability Officer, & Managing Director, CTV Holdings Jay Bys - Executive Vice President and Chief Commercial Officer Omar Hayat - Executive Vice Pres ...

As of September 30, 2023 NOTE 12 CONDENSED CONSOLIDATING FINANCIAL INFORMATION We have designated certain of our subsidiaries as Unrestricted Subsidiaries under the indenture governing our Senior Notes (Senior Notes Indenture). Unrestricted Subsidiaries (as defined in the Senior Notes Indenture) are subject to fewer restrictions under the Senior Notes Indenture. We are required under the Senior Notes indenture to present the financial condition and results of operations of CRC and its Restricted Subsidiarie ...

California Resources Corporation (OTCPK:CRCQW) Q2 2023 Earnings Conference Call August 1, 2023 1:00 PM ET Company Participants Joanna Park - Vice President, Investor Relations and Treasurer Francisco Leon - President and Chief Executive Officer Manuela Molina - Executive Vice President and Chief Financial Officer Chris Gould - Executive Vice President and Chief Sustainability Officer, and Managing Director, CTV Holdings Conference Call Participants Scott Hanold - RBC Capital Markets Kalei Akamine - Bank of ...

Financial Performance & Guidance - CRC delivered $108 million in operating cash flow and $69 million in free cash flow in 2Q23[21] - The company returned $84 million to shareholders through SRP and fixed dividend payments[21] - CRC is on track to achieve over $50 million in year-end 2023 run rate reduction for non-energy operating costs and adjusted E&P Corp & Other G&A[12] - 2023E Free Cash Flow is guided at $380 million to $460 million[86] Carbon Management Business (CMB) & Carbon TerraVault (CTV) - CTV is targeting 5 MMTPA of injection by YE27 and has a designed capacity for 200 MMT for long-term success[22,66] - CTV has submitted Class VI permits to the EPA for 191 MMT of CO2 storage[12,67] - CTV JV is targeting $250 million - $675 million in EBITDA by YE28[66] - CTV signed a storage-only CDMA with Verde Clean Fuels Inc for a minimum volume commitment of 100 KMTPA of CO2 injection from a new renewable gasoline facility at CRC's Net Zero Industrial Park at Elk Hills Field[12] - The Lone Cypress blue hydrogen project was expanded by 105 KMTPA of CO2 injection for a total expected injection rate of 205 KMTPA[21] Operational Highlights - 2Q23 net production was 86 MBOE/D, with net oil production at 53 MBO/D[14] - The company bought back approximately 17% of CRC's common stock since the beginning of the SRP[32,54] - The company drilled 6 wells in 2Q23 and performed 679 well maintenance jobs[45]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to ___________ Commission file number 001-36478 California Resources Corporation (Exact name of registrant as specified in its charter) (State or other jurisd ...

California Resources Corporation (NYSE:CRC) Q1 2023 Earnings Conference Call May 2, 2023 1:00 PM ET Company Participants Francisco Leon - President, Chief Executive Officer Jay Bys - Executive Vice President, Chief Commercial Officer Joanna Park - Vice President of Investor Relations, Treasurer Conference Call Participants Scott Hanold - RBC Capital Markets Kalei Akamine - Bank of America Leo Mariani - ROTH MKM Nate Pendleton - Stifel Noel Park - Tuohy Brothers Investment Research Eric Seeve - GoldenTree Op ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to ___________ Commission file number 001-36478 California Resources Corporation (Exact name of registrant as specified in its charter) (State or other juris ...

"A Different Kind of Energy Company" • our ability to claim and utilize tax credits or other incentives in connection with our CCS projects, • general economic conditions and trends, including conditions in the worldwide financial, trade and credit markets; Fourth Quarter & Year End 2022 Results Strategic Realignment to Maximize Cash Flow Per Share February 24, 2023 Forward Looking / Cautionary Statements – Certain Terms • reorganization or restructuring of our operations; • government policy, war and polit ...

Part I [Business and Properties](index=8&type=section&id=Items%201%20%26%202%20Business%20and%20Properties) CRC is a California-focused independent oil and gas E&P company, also developing a carbon management business, holding 1.9 million net acres and 417 MMBoe proved reserves - CRC is an independent oil and natural gas E&P company focused exclusively on California, with a significant mineral acreage position of approximately **1.9 million net acres**[6](index=6&type=chunk)[217](index=217&type=chunk) - The company is actively developing a carbon management business named Carbon TerraVault, which includes a joint venture with Brookfield to pursue carbon capture and storage (CCS) projects[6](index=6&type=chunk)[77](index=77&type=chunk) - Following its emergence from Chapter 11 bankruptcy on October 27, 2020, the company adopted fresh start accounting, which may affect the comparability of financial statements before and after this date[7](index=7&type=chunk)[237](index=237&type=chunk) Key Operational and Financial Metrics (as of Dec 31, 2022) | Metric | Value | | :--- | :--- | | Net Mineral Acres | 1.9 million | | Operated Wells | ~10,000 | | Average Net Production (2022) | 91 MBoe/d | | Proved Reserves | 417 MMBoe | [Business Strategy](index=8&type=section&id=Business%20Strategy) The company's strategy focuses on advancing carbon management, optimizing E&P, improving financial flexibility, and increasing shareholder returns - Advance the carbon management business through Carbon TerraVault, focusing on signing up emitter projects and submitting Class VI permit applications for permanent carbon sequestration[266](index=266&type=chunk) - Execute a core E&P development plan by reducing the average rig count to **1.5 in 2023**, focusing on permitted projects, and increasing workover activity to minimize production decline[9](index=9&type=chunk) - Improve financial flexibility by pursuing options to amend, extend, or replace its Revolving Credit Facility and refinance its Senior Notes, while also seeking separate financing for the carbon management business[219](index=219&type=chunk) - Focus on increasing shareholder returns through capital allocation optimization, cost reductions, and a share repurchase program, which was increased to a total of **$1.1 billion**[239](index=239&type=chunk) - Maintain a commitment to safety and sustainability, with a Full-Scope Net Zero goal by **2045**. For **2023**, **30%** of management's annual incentive is tied to safety and ESG-related metrics[10](index=10&type=chunk) [Oil and Natural Gas Operations](index=9&type=section&id=Oil%20and%20Natural%20Gas%20Operations) CRC's oil and gas operations are concentrated in California's San Joaquin, Los Angeles, Sacramento, and Ventura basins, with San Joaquin as the largest Operations Summary by Basin (Year Ended Dec 31, 2022) | Basin | Net Mineral Acreage (thousands) | Proved Reserves (MMBoe) | Avg. Daily Net Production (MBoe/d) | | :--- | :--- | :--- | :--- | | San Joaquin | 1,248 | 295 | 70 | | Los Angeles | 29 | 113 | 18 | | Sacramento | 466 | 9 | 3 | | Ventura | 6 | — | — | | **Total** | **1,867** | **417** | **91** | - The San Joaquin Basin is the company's largest operational area, featuring the Elk Hills field, benefiting from extensive 3D seismic data and integrated infrastructure[13](index=13&type=chunk)[242](index=242&type=chunk)[270](index=270&type=chunk) - The Los Angeles Basin contains high-concentration oil fields like Wilmington and Huntington Beach, with a significant portion of Wilmington production subject to production-sharing contracts (PSCs)[244](index=244&type=chunk) - The company has divested the vast majority of its assets in the Ventura basin, with the remaining non-operated asset expected to be sold in the first half of 2023[273](index=273&type=chunk) [Production, Price and Cost History](index=14&type=section&id=Production%2C%20Price%20and%20Cost%20History) This section details the company's historical production volumes, realized commodity prices, and operating costs from 2020 to 2022 Production and Price Summary (2020-2022) | Metric | 2022 | 2021 | 2020 | | :--- | :--- | :--- | :--- | | **Avg. Daily Net Production (MBoe/d)** | 91 | 100 | 112 | | Oil (MBbl/d) | 55 | 60 | 70 | | NGLs (MBbl/d) | 11 | 13 | 13 | | Natural Gas (MMcf/d) | 147 | 159 | 174 | | **Avg. Realized Oil Price (w/o hedge, $/Bbl)** | $98.26 | $70.43 | $41.21 (Predecessor) | | **Avg. Realized Oil Price (with hedge, $/Bbl)** | $61.80 | $56.05 | $43.19 (Predecessor) | | **Operating Costs per Boe** | $23.75 | $19.39 | $14.95 (Predecessor) | - Production-sharing contracts (PSCs) in the Wilmington field represented **16%** of total production in **2022**, inflating reported revenue and operating costs per barrel without affecting net results[21](index=21&type=chunk)[279](index=279&type=chunk) [Estimated Proved Reserves and Future Net Cash Flows](index=16&type=section&id=Estimated%20Proved%20Reserves%20and%20Future%20Net%20Cash%20Flows) This section details the company's proved oil and gas reserves and associated future net cash flows as of December 31, 2022 Proved Reserves as of Dec 31, 2022 | Reserve Type | Oil (MMBbl) | NGLs (MMBbl) | Natural Gas (Bcf) | Total (MMBoe) | | :--- | :--- | :--- | :--- | :--- | | Proved Developed | 251 | 36 | 458 | 363 | | Proved Undeveloped | 43 | 2 | 53 | 54 | | **Total Proved** | **294** | **38** | **511** | **417** | - Total proved reserves decreased from **480 MMBoe** at year-end **2021** to **417 MMBoe** at year-end **2022**, primarily due to **33 MMBoe** production, **34 MMBoe** negative revisions from California regulatory changes, and **16 MMBoe** negative performance revisions[34](index=34&type=chunk)[35](index=35&type=chunk)[282](index=282&type=chunk) - California regulatory changes and court challenges led to a **34 MMBoe** negative revision to proved reserves, including **20 MMBoe** from Senate Bill No. 1137 uncertainty and **14 MMBoe** from Kern County permitting challenges[35](index=35&type=chunk) - Proved undeveloped (PUD) reserves decreased from **75 MMBoe** to **54 MMBoe** during **2022**, primarily due to a **23 MMBoe** negative revision related to regulatory changes affecting development plans beyond **5 years**[27](index=27&type=chunk)[28](index=28&type=chunk) PV-10 and Standardized Measure (as of Dec 31, 2022) | Metric | Value (in millions) | | :--- | :--- | | PV-10 of cash flows (Non-GAAP) | $9,219 | | Standardized measure of discounted future net cash flows (GAAP) | $6,726 | - The company's internal reserve estimates are audited by independent firms, with Ryder Scott and NSAI collectively auditing **85%** of total proved reserves in **2022**[31](index=31&type=chunk) [Carbon Management Business](index=25&type=section&id=Carbon%20Management%20Business) The company is developing Carbon TerraVault, a carbon management business, through a joint venture with Brookfield for Carbon Capture and Storage (CCS) projects - The company has formed a carbon management business, Carbon TerraVault, to pursue Carbon Capture and Storage (CCS) projects, intending to manage it as a stand-alone business over time[74](index=74&type=chunk) - In August **2022**, CRC entered into a joint venture (Carbon TerraVault JV) with Brookfield, where CRC holds a **51%** interest, and Brookfield committed an initial **$500 million** for jointly approved CCS projects[77](index=77&type=chunk)[98](index=98&type=chunk) - The company has submitted Class VI permit applications to the EPA for four permanent sequestration projects: two at the Elk Hills field and two in the Sacramento Basin[74](index=74&type=chunk) - In **2022**, CRC executed two carbon dioxide management agreements (CDMAs) with emitters to provide permanent carbon storage, framing the material economics and terms for future projects[75](index=75&type=chunk) [Human Capital Management](index=26&type=section&id=Human%20Capital%20Management) This section outlines the company's workforce demographics, diversity initiatives, and commitment to health and safety as of December 31, 2022 - As of December 31, **2022**, the company had approximately **1,060 employees**, with **45** full-time equivalents focused on the carbon management business[100](index=100&type=chunk) Workforce Diversity as of Dec 31, 2022 | Group | Gender Diverse | Ethnically and Racially Diverse | | :--- | :--- | :--- | | All Employees | 20% | 40% | | Managers | 21% | 23% | | Executives | 22% | 26% | | Board of Directors | 33% | 33% | - The company has established a **2030** diversity, equity, and inclusion (DE&I) goal to maintain >**20%** ethnic/racial diversity and increase gender diversity to **30%** in leadership positions[82](index=82&type=chunk)[83](index=83&type=chunk) - The company achieved a workforce Total Recordable Incident Rate (TRIR) of **0.62** in **2022**, demonstrating a strong focus on health and safety[10](index=10&type=chunk) [Regulation of the Industries in Which We Operate](index=27&type=section&id=Regulation%20of%20the%20Industries%20in%20Which%20We%20Operate) The company faces significant regulatory uncertainty in California, impacting well permitting, new well setbacks, and the developing framework for carbon capture and storage - The company faces significant regulatory uncertainty in California, particularly regarding well permitting, with CalGEM not issuing new production well permits since December **2022**, and ongoing litigation suspending local permitting[87](index=87&type=chunk)[88](index=88&type=chunk)[140](index=140&type=chunk) - Senate Bill No. 1137, establishing a **3,200-foot** setback for new wells, is stayed pending a November **2024** voter referendum, and its uncertainty led to a **4%** reduction in total proved reserves at year-end **2022**[110](index=110&type=chunk)[91](index=91&type=chunk) - The company's carbon capture and storage (CCS) business is subject to developing regulations, with Senate Bill No. 905 establishing a new regulatory framework in California that could affect project timing and feasibility[151](index=151&type=chunk)[152](index=152&type=chunk) - California has stringent laws to reduce GHG emissions, including a 'cap-and-trade' program and a Low Carbon Fuel Standard (LCFS), which impact operating costs and create opportunities for CCS-related credits[124](index=124&type=chunk)[154](index=154&type=chunk) [Risk Factors](index=36&type=section&id=Item%201A%20Risk%20Factors) The company faces diverse risks including commodity price volatility, California-specific regulatory challenges, indebtedness, stock price volatility, and general ESG and cybersecurity concerns [Risks Related to Our Business](index=37&type=section&id=Risks%20Related%20to%20Our%20Business) The company's business faces risks from volatile commodity prices, exclusive California operations, early-stage carbon management ventures, joint venture uncertainties, and inflationary cost pressures - Financial performance is highly dependent on volatile oil, natural gas, and NGL prices, which are influenced by global supply/demand, geopolitical events, and OPEC actions[164](index=164&type=chunk)[136](index=136&type=chunk) - Operations are exclusively in California, making the company vulnerable to regional risks such as state-specific regulations, local price fluctuations, natural disasters, and permitting delays[167](index=167&type=chunk)[194](index=194&type=chunk) - The Carbon TerraVault (CCS) business faces significant operational, technological, and regulatory risks as an early-stage venture, with success depending on securing long-term agreements, sufficient capital, and favorable financial/tax incentives like 45Q credits and LCFS[172](index=172&type=chunk)[175](index=175&type=chunk)[201](index=201&type=chunk) - The joint venture with Brookfield is subject to uncertainties, as future project funding requires joint approval, and a failure to agree could delay or cancel CCS projects, forcing the company to seek alternative capital[176](index=176&type=chunk)[178](index=178&type=chunk) - The company has been negatively impacted by inflation, experiencing high single-digit cost increases for materials and services in **2022**, which could continue to adversely affect financial results[214](index=214&type=chunk)[210](index=210&type=chunk) [Risks Related to Regulation and Government Action](index=45&type=section&id=Risks%20Related%20to%20Regulation%20and%20Government%20Action) The company faces significant regulatory risks from drilling permit delays, Senate Bill No. 1137's setback requirements, evolving CCS regulations, and broader climate change policies - The company faces material delays in obtaining drilling permits due to state-level actions by CalGEM and local litigation in Kern County, which has suspended permitting and could adversely affect future development plans and reserves[459](index=459&type=chunk)[461](index=461&type=chunk) - Senate Bill No. 1137, establishing a **3,200-foot** setback for new wells, creates significant uncertainty, and if implemented after the **2024** referendum, it could materially impact the ability to develop proved undeveloped reserves[433](index=433&type=chunk)[463](index=463&type=chunk) - The CCS business is subject to extensive and developing regulations, including obtaining EPA Class VI permits, and new California laws like Senate Bill No. 905 could create delays or render projects uneconomical[467](index=467&type=chunk)[469](index=469&type=chunk) - Concerns about climate change may lead to governmental actions that increase operating costs, reduce demand for products, and restrict access to capital, potentially lowering the value of reserves and assets[471](index=471&type=chunk)[502](index=502&type=chunk) [Risks Related to our Indebtedness](index=51&type=section&id=Risks%20Related%20to%20our%20Indebtedness) The company's indebtedness may limit financial flexibility, with risks including potential reductions in its Revolving Credit Facility borrowing base and restrictive debt covenants - Existing and future debt may limit financial flexibility, requiring a portion of cash flow for debt service and restricting the ability to make investments, pay dividends, or repurchase shares[479](index=479&type=chunk)[510](index=510&type=chunk) - The Revolving Credit Facility has a borrowing base that is redetermined semi-annually, and a reduction could negatively affect liquidity and require repayment of outstanding borrowings[513](index=513&type=chunk)[514](index=514&type=chunk) - Restrictive covenants in the Revolving Credit Facility and Senior Notes indenture limit operational and financial flexibility, where a breach could result in a default and acceleration of debt[515](index=515&type=chunk)[485](index=485&type=chunk) [Risks Related to Our Common Stock](index=53&type=section&id=Risks%20Related%20to%20Our%20Common%20Stock) Risks related to common stock include board discretion over dividends and repurchases, potential price volatility, and significant influence from a concentrated shareholder base - The ability to pay dividends and repurchase shares is subject to board discretion, financial condition, and restrictions in debt agreements[547](index=547&type=chunk)[519](index=519&type=chunk) - The trading price of the common stock may be volatile and could decline due to factors like changes in commodity prices, financial results, or future issuances of stock which could dilute ownership[488](index=488&type=chunk)[489](index=489&type=chunk) - As of December 31, **2022**, five shareholders collectively owned approximately **40%** of the common stock, giving them significant influence over corporate matters[522](index=522&type=chunk) [Unresolved Staff Comments](index=56&type=section&id=Item%201B%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the SEC - There are no unresolved staff comments[561](index=561&type=chunk)[531](index=531&type=chunk) [Legal Proceedings](index=56&type=section&id=Item%203%20Legal%20Proceedings) Information regarding legal proceedings is referenced in Management's Discussion and Analysis and the Notes to Financial Statements - For information regarding legal proceedings, refer to Part II, Item 7 – Management's Discussion and Analysis and Part II, Item 8 – Financial Statements, Note 6[532](index=532&type=chunk) [Mine Safety Disclosures](index=57&type=section&id=Item%204%20Mine%20Safety%20Disclosures) This section is not applicable to the company - Not applicable[563](index=563&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=58&type=section&id=Item%205%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on the NYSE under 'CRC', with a targeted annual dividend of $1.13 per share and an authorized share repurchase program of up to $1.1 billion through June 2024 - The Board of Directors has approved a cash dividend policy targeting a total annual dividend of **$1.13 per share**, payable in quarterly increments of **$0.2825 per share**, subject to quarterly board approval[566](index=566&type=chunk) - The Board authorized a Share Repurchase Program of up to **$1.1 billion** through June 30, **2024**, including a **$250 million** increase and an extension approved on February 23, **2023**[567](index=567&type=chunk)[618](index=618&type=chunk) Share Repurchase Activity for 2022 | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | **Total 2022** | **7,366,272** | **$42.47** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=62&type=section&id=Item%207%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion highlights 2022 financial performance driven by higher commodity prices, offset by lower production and inflation, resulting in increased total operating revenues to $2.7 billion but decreased net income to $524 million due to tax provisions - The company experienced high single-digit inflation in **2022** for materials and services such as OCTG, fluid hauling, and labor, and has entered into multi-year contracts to mitigate these effects[607](index=607&type=chunk)[608](index=608&type=chunk) - Average daily net production decreased by **9%** from **100 MBoe/d** in **2021** to **91 MBoe/d** in **2022**, primarily due to divestitures and natural decline[610](index=610&type=chunk) - The **2023** capital program is projected to be between **$200 million** and **$245 million**, with a focus on executing projects with existing permits and advancing carbon management activities[744](index=744&type=chunk) - As of December 31, **2022**, the company had total liquidity of **$765 million**, consisting of **$307 million** in cash and **$458 million** available under its Revolving Credit Facility[743](index=743&type=chunk) [Statement of Operations Analysis](index=69&type=section&id=Statement%20of%20Operations%20Analysis) This section analyzes the company's consolidated revenues and expenses, highlighting the impact of commodity prices, production volumes, and tax provisions on financial results Consolidated Revenue Comparison (2021 vs. 2022) | Revenue Item (in millions) | 2022 | 2021 | | :--- | :--- | :--- | | Oil, natural gas and NGL sales | $2,643 | $2,048 | | Net loss from commodity derivatives | ($551) | ($676) | | Electricity sales | $261 | $172 | | **Total operating revenues** | **$2,707** | **$1,889** | Consolidated Expense Comparison (2021 vs. 2022) | Expense Item (in millions) | 2022 | 2021 | | :--- | :--- | :--- | | Operating costs | $785 | $705 | | General and administrative expenses | $222 | $200 | | Depreciation, depletion and amortization | $198 | $213 | | **Total operating expenses** | **$1,954** | **$1,720** | - Oil, natural gas, and NGL sales increased by **$595 million** year-over-year due to an **$865 million** positive impact from higher realized prices, partially offset by a **$270 million** negative impact from lower production volumes[596](index=596&type=chunk) - Energy operating costs increased by **27%** to **$323 million** in **2022**, primarily due to higher prices for purchased natural gas and electricity used in operations[659](index=659&type=chunk) - The company recorded an income tax provision of **$237 million** in **2022**, compared to an income tax benefit of **$396 million** in **2021**, which included the release of a valuation allowance[635](index=635&type=chunk) [Liquidity and Capital Resources](index=74&type=section&id=Liquidity%20and%20Capital%20Resources) This section details the company's liquidity position, cash flow activities, and capital expenditure plans, highlighting strong liquidity and strategic investments Liquidity Summary (as of Dec 31, 2022) | Component (in millions) | Amount | | :--- | :--- | | Cash and cash equivalents | $307 | | Revolving Credit Facility Availability | $458 | | **Total Liquidity** | **$765** | - Net cash provided by operating activities increased by **5%** to **$690 million** in **2022**, up from **$660 million** in **2021**, driven by higher realized prices partially offset by lower production and higher costs[704](index=704&type=chunk) - Net cash used in investing activities increased to **$317 million** in **2022** from **$161 million** in **2021**, primarily due to a larger capital program[646](index=646&type=chunk) - Net cash used in financing activities was **$371 million** in **2022**, mainly for common stock repurchases (**$313 million**) and dividends (**$59 million**)[677](index=677&type=chunk)[745](index=745&type=chunk) [Financial Statements and Supplementary Data](index=82&type=section&id=Item%208%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for 2022, including the independent auditor's unqualified opinion and key notes on accounting policies and critical audit matters - The independent auditor, KPMG LLP, issued an unqualified opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting as of December 31, **2022**[692](index=692&type=chunk)[719](index=719&type=chunk) - Critical audit matters identified by the auditor include the assessment of estimated proved oil and gas reserves used for calculating depletion expense and the evaluation of control over the Carbon TerraVault JV under the variable interest entity model[698](index=698&type=chunk)[700](index=700&type=chunk) Consolidated Balance Sheet Summary (in millions) | Account | Dec 31, 2022 | Dec 31, 2021 | | :--- | :--- | :--- | | Total Assets | $3,967 | $3,846 | | Total Liabilities | $2,103 | $2,158 | | Total Stockholders' Equity | $1,864 | $1,688 | Consolidated Statement of Operations Summary (in millions) | Account | Year Ended Dec 31, 2022 | Year Ended Dec 31, 2021 | | :--- | :--- | :--- | | Total Operating Revenues | $2,707 | $1,889 | | Operating Income | $812 | $293 | | Net Income | $524 | $625 |

January 2023 Investor Presentation "A Different Kind of Energy Company" • fluctuations in commodity prices and the potential for sustained low oil, natural gas and natural gas liquids prices; • availability or timing of, or conditions imposed on, permits and approvals necessary for drilling or development activities and carbon management projects; • incorrect estimates of reserves and related future cashflows and the inability to replace reserves; • our ability to successfully execute on the construction an ...