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SandRidge Energy First Quarter 2022 Results

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SandRidge Energy, Inc. announced financial and operational results for the three month period ended March 31, 2022.

Recent Highlights:

• Generated Adjusted EBITDA⁽¹⁾ of $39.4 million in the first quarter compared to $37.5 million in the prior quarter

• First quarter net income was $34.7 million, or $0.95 per share. Adjusted net income was $34.9 million, or $0.95 per share

• First quarter production of 17.8 MBoed compared to Mid-Continent production of 17.5 MBoed in the same period of 2021, despite no drilling or completion activity over the prior twelve months

• During the first quarter, the Company proactively procured approximately $4.7 million worth of materials related to its 2022 capital program, helping to mitigate the impacts of inflation for goods and services

• As of March 31, 2022, the Company returned 139 wells to production since the beginning of 2021 that were previously curtailed due to the 2020 commodity price downturn

• The Company had no open hedge positions as of March 31, 2022

• First quarter adjusted G&A⁽¹⁾ of $2.2 million, or $1.35 per Boe, compared to $2.5 million, or $1.46 per Boe in the prior quarter

Financial Results & Update

Profitability & Realized Pricing

For the three-months ended March 31, 2022, the Company reported net income of $34.7 million, or $0.95 per share, and net cash provided by operating activities of $32.2 million. After adjusting for certain items, the Company's adjusted net income⁽¹⁾ amounted to $34.9 million, or $0.95 per share, operating cash flow⁽²⁾ totaled $39.1 million and adjusted EBITDA⁽¹⁾ was $39.4 million for the quarter. The Company defines and reconciles adjusted net income, operating cash flow, adjusted EBITDA, and other non-GAAP financial measures to the most directly comparable Generally Accepted Accounting Principles in the United States ("GAAP") measure in supporting tables at the conclusion of this press release.

First quarter realized oil, natural gas, and natural gas liquids prices, before the impact of derivatives,⁽²⁾ were $92.35, $3.84 and $33.73, respectively, compared to $75.72, $3.94 and $28.39 in the prior quarter. The table below compares the Company's first quarter oil and gas realizations to the daily average spot prices for Henry Hub and West Texas Intermediate ("WTI"). Since the end of the first quarter, commodity prices have continued to rise, further boosting the Company's cash flow generation potential.

 Operating Costs

During the first quarter of 2022, lease operating expense ("LOE") was $10.9 million or $6.76 per Boe compared to $9.7 million, or $5.74 per Boe in the prior quarter. The increase is primarily due to a higher number of producing wells, higher workover expense associated with our well reactivation program, and higher service and materials costs due to recent inflation.

For the three months ended March 31, 2022, general and administrative expense ("G&A") was $2.5 million, or $1.57 per Boe compared to $2.8 million, or $1.67 per Boe for the three months ended December 31, 2021. Adjusted G&A⁽¹⁾ was $2.2 million, or $1.35 per Boe during the first quarter of 2022 compared to $2.5 million, or $1.46 per Boe during the fourth quarter of 2021.

Operational Results & Update

Production

Production totaled 1,606 MBoe (17.8 MBoed, 13.3% oil, 32.8% NGLs and 53.9% natural gas) for the three-months ended March 31, 2022 compared to 1,574 MBoe (17.5 MBoed, 14.0% oil, 33.1% NGLs, and 52.9% natural gas) of Mid-Continent production in the same period of 2021, representing an increase of approximately two percent despite no new drilling or completion activity over the prior twelve months.

2022 Development Program

During the first quarter, SandRidge proactively procured approximately $4.7 million worth of materials related to its 2022 capital program in order to secure favorable pricing in relationship to the current inflationary environment. Approximately $0.9 million of these costs were recorded as prepaid expenses. All of these expenditures are in line with the annual guidance figures published in conjunction with the announcement of the Company's 2022 capital development program on March 9, 2022.

Well Reactivation & Rod Pump Conversion Program

During the first quarter of 2022, the Company continued returning wells to production that were previously curtailed due to the commodity price downturn in the first half of 2020 and, in many cases, improving their production potential through modest capital improvements. Improved commodity pricing resulting in high rates of return, along with low execution risk, support the Company's belief that these projects represent an efficient use of capital. During the first three months of 2022, the Company brought 10 wells back online, bringing the total since the beginning of 2021 to 139. SandRidge currently expects to return approximately 30 wells to production and complete approximately 35 artificial lift conversions throughout 2022 and continues to evaluate its inventory of such projects.

Environmental, Social, and Governance ("ESG")

SandRidge maintains its Environmental, Social, and Governance ("ESG") commitment, to include no routine flaring of produced natural gas. The Company continues to explore the technical and commercial viability of Carbon Capture, Utilization, and Sequestration ("CCUS") across its owned and operated assets through its partnership with the University of Oklahoma.