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• It's like Newmont (the gold mining company) but for oil and natural gas.
• Think of it as Freeport-McMoRan (the copper mining giant) but focused on extracting oil and natural gas.

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• Crude Oil: A valuable liquid hydrocarbon produced and sold, which is refined into gasoline, diesel, and other petroleum products.
• Natural Gas: A gaseous hydrocarbon extracted and sold, primarily used as a fuel for electricity generation and heating.
• Natural Gas Liquids (NGLs): A group of valuable hydrocarbons, including ethane, propane, and butane, separated from natural gas and sold as feedstocks and fuels.

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Permian Resources (PR) is an independent oil and natural gas exploration and production company. As such, it sells crude oil, natural gas, and natural gas liquids (NGLs) primarily to other companies rather than directly to individuals.

According to its latest annual report (10-K filing), Permian Resources states that no single customer accounted for 10% or more of its total revenue for the years ended December 31, 2023, 2022, or 2021. Therefore, specific "major customers" by name are not disclosed, reflecting the diversified nature of its sales to multiple purchasers.

Permian Resources' customers are typically businesses involved in the downstream and midstream segments of the energy industry. These include:

• Refiners
• Integrated major oil companies
• Pipeline companies (midstream operators)
• Utilities
• Commodity marketers and traders

Due to the lack of disclosure of individual customers meeting the "major" threshold (10% or more of total revenue), specific names and symbols of customer companies cannot be provided.

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Key Risks to Permian Resources

• Commodity Price Volatility: Permian Resources' financial performance is heavily dependent on the highly volatile prices of oil, natural gas, and natural gas liquids (NGLs). A sustained period of low prices could severely affect the company's revenue, cash flows, and the carrying value of its properties. This is consistently identified as the largest risk, influenced by global factors such as OPEC+ decisions, geopolitical conflicts, and macroeconomic demand shifts.
• Regulatory and Environmental Risks: The company is exposed to potential changes in environmental laws, including those related to climate change, greenhouse gas emissions, and hydraulic fracturing. Compliance with new regulations could increase operational costs and limit growth opportunities. Furthermore, specific incidents, such as an alleged undisclosed major methane and hazardous chemical leak from its New Mexico facilities, highlight significant regulatory non-compliance, potential environmental liabilities, and heightened scrutiny that could lead to substantial fines, remediation costs, and prolonged legal battles, potentially impacting operational growth and profitability.
• Geographical Concentration: Permian Resources' operations are concentrated exclusively within the Permian Basin, primarily the Delaware Basin. This geographical concentration makes the company particularly vulnerable to region-specific factors such as localized supply and demand imbalances, adverse weather conditions, and regulatory changes unique to the Permian Basin, thereby limiting its diversification against such risks.

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Accelerated global transition to electric vehicles and renewable energy sources, posing a long-term threat to demand for crude oil and natural gas liquids.

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Permian Resources (NYSE: PR) is an independent oil and natural gas company. Its main products are crude oil and natural gas, with operations concentrated in the Permian Basin, specifically the Delaware Basin, in West Texas and New Mexico, United States.

The addressable market for Permian Resources' main products is the Permian Basin in the United States. For 2023, the crude oil production in the Permian Basin was 5,790 thousand barrels of oil per day (mbd), and natural gas production was 19,315 million cubic feet per day (mmcfd).

Looking ahead to 2025, crude oil output in the Permian Basin is projected to reach 6.6 million barrels per day (b/d), and marketed natural gas production is expected to grow to 25.8 billion cubic feet per day (Bcf/d).

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Permian Resources (PR) is expected to drive future revenue growth over the next 2-3 years through a combination of increased hydrocarbon production, strategic acquisitions, enhanced natural gas marketing, and improved capital efficiency.

1. Increased Hydrocarbon Production Volumes: Permian Resources has demonstrated consistent outperformance in its production, leading to raised full-year guidance for both oil and total equivalent barrels per day. For example, the company increased its original fiscal year 2025 oil guidance by approximately 5% while lowering its capital budget by about 2%, signifying more output from existing capital deployment. This growth in overall production volumes directly translates to higher revenue.
2. Strategic and Accretive Acquisitions: The company employs a disciplined "bolt-on" acquisition strategy, primarily in the Delaware Basin, to expand its high-quality acreage and inventory. These acquisitions, such as the approximately 250 transactions completed in Q3 2025 adding 5,500 net acres and 2,400 net royalty acres, integrate seamlessly into its existing portfolio, providing additional high-return drilling locations that contribute to increased future production and revenue.
3. Enhanced Natural Gas Marketing and Improved Realized Prices: Permian Resources has significantly improved its natural gas marketing portfolio by securing firm capacity on long-haul pipelines and entering into sales agreements that direct gas to higher-demand markets like the Gulf Coast and DFW regions. These agreements are anticipated to improve natural gas pricing by approximately $1 per Mcf relative to the Waha hub in 2026, leading to a projected uplift of over $100 million in free cash flow in 2026 and increasing realized prices on a larger portion of its natural gas production.
4. Capital Efficiency and Operational Excellence: The company's focus on operational efficiencies, including reduced drilling and completion (D&C) costs, shorter cycle times, and strong well performance, allows it to achieve higher production volumes without a proportional increase in capital expenditures. This improved capital efficiency enables the company to generate more revenue from its invested capital and raise production guidance while maintaining or even reducing its capital budget.

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Share Repurchases

• Permian Resources authorized a $1 billion stock repurchase program in September 2024.
• The company repurchased 5.0 million shares for $67 million in the fourth quarter of 2023.
• During 2025, Permian Resources executed $75 million in share buybacks, including 4.1 million shares for $43 million in Q1 and 2.3 million shares for $30 million in Q3.

Share Issuance

• In Q3 2025, 30.6 million Class A shares, valued at $430 million, were issued upon the conversion of 3.25% exchangeable senior notes due 2028.
• A secondary offering of 46.1 million Class A common shares by existing investors occurred in September 2025, with no proceeds received by Permian Resources.
• Permian Resources Operating, LLC originally issued 3.25% exchangeable senior notes due 2028 in March 2021, with potential for future Class A Common Stock issuance upon exchange.

Outbound Investments

• Permian Resources closed the $4.5 billion Earthstone acquisition on November 1, 2023, solidifying its position as a leading Delaware Basin independent.
• In Q2 2025, the company acquired approximately 13,320 net acres and 8,700 net royalty acres in the Northern Delaware Basin from APA Corporation for $608 million.
• During Q3 2025, roughly 250 bolt-on and grassroots transactions were executed for $180 million, adding 5,500 net leasehold acres and 2,400 net royalty acres, with 95% of this capital invested in New Mexico.

Capital Expenditures

• The projected total cash capital expenditure budget for 2025 is between $1.92 billion and $2.02 billion, with a strategic focus on maximizing free cash flow and increasing capital efficiency.
• In 2023, the estimated total capital budget ranged from approximately $1.25 billion to $1.45 billion.
• The 2024 capital budget prioritized an approximate 10% reduction in drilling and completion costs per foot compared to 2023, with an increasing portion allocated to high-returning inventory in New Mexico.