Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 1, 2018

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NOBLE ENERGY, INC.
(Exact name of Registrant as specified in its charter)
 
 
 
 
 
 
Delaware
 
001-07964
 
73-0785597
(State or other jurisdiction of
incorporation or organization)
 
Commission
File Number
 
(I.R.S. Employer
Identification No.)
 
 
1001 Noble Energy Way,
Houston, Texas
 
 
 
77070
(Address of principal executive offices)
 
 
 
(Zip Code)
Registrant’s telephone number, including area code: (281) 872-3100
(Former name, former address and former fiscal year, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o





Item 2.02. Results of Operations and Financial Condition.
On May 1, 2018 Noble Energy, Inc. (the “Company”) issued a press release announcing results for the fiscal quarter ended March 31, 2018. A copy of the press release issued by the Company is furnished as Exhibit 99.1 to this Current Report and will be published on the Company’s website at www.nblenergy.com.
The Company’s press release announcing its financial results for its fiscal quarter ended March 31, 2018 contains non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with United States generally accepted accounting principles, or GAAP. The Company has provided quantitative reconciliations within the press release of the non-GAAP financial measures to the most directly comparable GAAP financial measures.
In accordance with General Instruction B.2. of Form 8-K, the information set forth herein and in the press release is deemed to be “furnished” and shall not be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
Item 7.01. Regulation FD Disclosure.
On May 1, 2018, we will present certain information in connection with our call with shareholders, analysts and others relating to our results of operations discussed above.  Attached hereto as Exhibit 99.2 are slides that will be presented at that time.
The information included in this Current Report under Item 7.01, including Exhibit 99.2, is deemed to be “furnished” and shall not be “filed” for purposes of Section 18 of the Exchange Act.
Item 9.01. Financial Statements and Exhibits.
(d)
Exhibits. The following exhibit is furnished as part of this Current Report on Form 8-K:
 
99.1
Press release dated May 1, 2018 announcing results for the fiscal quarter ended March 31, 2018.
 
99.2
First quarter 2018 supplemental slide presentation.





SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
 
 
 
 
 
 
 
 
 
 
 
NOBLE ENERGY, INC.
 
 
 
 
Date:
May 1, 2018
 
 
By: 
 
/s/ Kenneth M. Fisher
 
 
 
 
 
 
Kenneth M. Fisher
 
 
 
 
 
 
Executive Vice President, Chief Financial Officer





INDEX TO EXHIBITS
 
 
 
 
Exhibit No.
  
Description
 
 
99.1
  
99.2
 


Exhibit


 
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NEWS RELEASE
 
 
 
 
 
 
 

NOBLE ENERGY ANNOUNCES FIRST QUARTER 2018 RESULTS

HOUSTON (May 1, 2018) -- Noble Energy, Inc. (NYSE: NBL) (“Noble Energy” or the "Company”) today announced first quarter 2018 financial and operating results. Highlights include:

Delivered quarterly sales volumes of 361 MBoe/d(1) up 18 percent(2) from first quarter 2017 on organic capital expenditures of $781 million.
Increased U.S. onshore oil production over 30 percent(2) compared to the first quarter of 2017 driven by Delaware Basin growth.
Completed the Company’s third central gathering facility in the Delaware Basin.
Established a record for first quarter gross sales volumes in Israel of 959 MMcfe/d.
Secured contracts totaling up to an additional 740 MMcf/d of natural gas sales to customers in Egypt and Israel from Tamar and Leviathan.
Closed the divestments of the General Partner of CONE Gathering and a 7.5 percent working interest in the Tamar field, and announced the sale of the Gulf of Mexico business.
Reduced Noble Energy debt by $230 million and increased total financial liquidity to more than $5 billion at the end of the first quarter.
Announced $750 million share repurchase program and repurchased approximately $67.5 million of Noble Energy stock during late February and March.

David L. Stover, Noble Energy’s Chairman, President and CEO, commented, “Noble Energy is off to a fast start in 2018, building on our successes in 2017. In the first quarter, we accomplished numerous strategic objectives. Our portfolio transformation and superior execution capabilities have positioned us to continue driving improved capital efficiency and corporate returns. Our core positions in the U.S. onshore business provide a great foundation for high-return, high-margin growth. Offshore, we are maximizing cash flow from our assets, while progressing our world-class Leviathan development. Growing our cash flows enables us to accelerate direct return to shareholders through our buyback program and our recent dividend increase."



1



Accounting Standard Implementation

Beginning January 1, 2018, the Company modified the presentation of revenue and certain gathering and transportation expenses based on the timing of transfer of ownership of produced commodities in accordance with the implementation of FASB Accounting Standards Codification Standard 606 ("ASC 606"). In addition, the new standard impacted the presentation of natural gas and natural gas liquids (NGL) volumes sold under certain contracts, primarily in the DJ Basin. There was no impact on the Company's operating cash flows or net income.

First Quarter 2018 Results

First quarter net income attributable to Noble Energy totaled $554 million, or $1.14 per diluted share. The Company reported adjusted net income(3) and adjusted net income per share(3) attributable to Noble Energy for the quarter of $172 million, or $0.35 per diluted share, which excludes the impact of certain items typically not considered by analysts in formulating estimates. Adjusted EBITDAX(3) was $797 million.

During the first quarter, the Company invested $671 million in its upstream operations, with approximately 75 percent deployed to the Company's U.S. onshore plays and 22 percent spent in Israel primarily for Leviathan development. The Company also funded $110 million for U.S. onshore midstream assets. Consolidated capital included $139 million organic expenditures and $206 million for a pipeline acquisition, related to Noble Midstream Partners LP ("Noble Midstream").

Prior to the implementation of ASC 606, total company sales volumes for the first quarter 2018 were 361 thousand barrels of oil equivalent per day(1) (MBoe/d). Compared to the first quarter of 2017, sales volume increased by approximately 18 percent(2) driven by growth from the Company's U.S. onshore assets. Reflecting the implementation of ASC 606, first quarter 2018 sales volumes totaled 370 MBoe/d.

Unit operating expenses for the first quarter 2018 totaled $10.06 per barrel of oil equivalent (BOE)(1), including lease operating expenses (LOE), production and ad valorem taxes, gathering and transportation expenses, other royalty expense and marketing costs. In the U.S. onshore, slightly higher LOE was more than offset by lower gathering and transportation expenses.

Income from equity method investees for the quarter of $47 million was greater than expected, primarily due to the strength of liquids prices at the methanol and LPG plants in Equatorial Guinea. Midstream services revenue totaled $13 million for the quarter, primarily comprised of consolidated Noble Midstream third-party gathering revenue.



2



Further Strengthened the Balance Sheet

As part of the Company's long-term strategic plan and multi-year outlook, Noble Energy has prioritized the direct return of capital to shareholders. During the first quarter, Noble Energy repurchased nine percent of its announced $750 million share repurchase program. On April 23, 2018, Noble Energy increased its quarterly dividend 10 percent to $0.11 per share.

During the first quarter, the Company completed an amendment to its $4 billion revolving credit facility which extended the maturity date by two years to March 2023. Noble Midstream also completed a credit facility amendment, extending the maturity date of its revolver to March 2023 and increasing the facility size to $800 million.

The Company paid down $230 million of Noble Energy debt during the first quarter. Total financial liquidity increased to more than $5 billion, comprised of cash and Noble Energy's undrawn credit facility borrowing capacity. Subsequent to quarter-end, the Company issued an early call for $379 million of legacy Rosetta Resources Inc. notes, set to mature in May 2021 with a settlement date of May 1, 2018. Noble Midstream's outstanding debt at the end of the first quarter increased by $350 million, primarily as a result of the acquisition of the Saddle Butte pipeline.

Noble Energy's Investment Grade credit rating was reaffirmed during the first quarter. In addition, S&P revised its outlook for Noble Energy to stable from negative, while Fitch revised its outlook to positive from stable.

Solid U.S. Onshore Operations

Total sales volumes across the Company’s U.S. onshore assets averaged 237 MBoe/d(1) in the first quarter 2018, up approximately 40 percent(2) from the first quarter 2017. U.S. onshore oil volumes totaled 103 thousand barrels of oil per day (MBbl/d), up over 30 percent(2) from the first quarter of 2017, with the increase primarily driven by the Company’s Delaware Basin assets. Reflecting the implementation of ASC 606, first quarter 2018 U.S. onshore sales volumes totaled 246 MBoe/d.

The DJ Basin averaged 111 MBoe/d(1), up seven percent(2) from the first quarter of last year, with the oil mix increased to a record of 56 percent(1). Reflecting the implementation of ASC 606, first quarter 2018 DJ Basin sales volumes totaled 120 MBoe/d, with an oil mix of 52 percent. DJ Basin sales volumes were driven by continued strong well performance in the Company’s Wells Ranch and East Pony areas. The Company brought online 31 wells within the first quarter, consisting of 15 wells in Wells Ranch and 16 wells in East Pony. Late in the quarter, completion activity moved to the Mustang IDP area.

3




Sales volumes from the Company's Delaware Basin assets totaled 45 MBoe/d, with an oil mix of 69 percent. Compared to the first quarter of last year, sales volumes increased by over 85 percent(2). The Company brought online 13 wells in the first quarter, all of which were located on multi-well pads. The majority were landed within the Wolfcamp A Upper and Lower zones as well as one well in the Third Bone Spring and one well in the Wolfcamp C. Within the quarter, the Company expanded its produced water management program, with nearly 10 percent of water used in completions being recycled produced water.

In late March, the Company completed its third central gathering facility ("CGF") in the Delaware Basin operated by Noble Midstream. The facility represents the Company's first CGF in the southern portion of the Company's acreage. The Company commenced operations from its fourth CGF in late April, and expects one additional CGF online by the end of the second quarter.

Sales volumes from the Eagle Ford totaled 81 MBoe/d, and were impacted approximately 3 MBoe/d in the first quarter due to facility downtime impacts. Activity in the Eagle Ford focused on completions for wells expected online in the second quarter of 2018.

During the first quarter, Noble Energy averaged nine operated drilling rigs (one DJ, six Delaware and two Eagle Ford). The Company improved drilled footage per day in the first quarter compared to the 2017 average by three percent, 10 percent and seven percent in the DJ, Delaware and Eagle Ford, respectively.

Significant Milestones in the Eastern Mediterranean

March 2018 marked the five-year anniversary of first production from Tamar, offshore Israel. During the quarter, the field reached cumulative production of 1.5 Tcf since start-up. A record was established for first quarter gross sales volumes of 959 million cubic feet of natural gas equivalent per day (MMcfe/d). Net sales volumes totaled 263 MMcfe/d during the first quarter of 2018. On March 14, 2018, the Company closed the divestment of a 7.5 percent working interest in the Tamar field. Also during the first quarter, the Company exceeded more than three million man hours and one year of performance without a recordable safety incident.

Currently, development of the Leviathan project is approximately 45 percent complete and construction of the production platform continues to progress. A drilling rig arrived in March and commenced operations of the Leviathan-3 well in early April. The pipe lay vessel is on-site, installing infield flowlines and gas gathering pipelines which will connect to the platform. The project remains on budget and on schedule with first gas sales anticipated by the end of 2019.


4



Since year-end 2017, the Company has executed several natural gas contracts with customers in Egypt and Israel bringing total volumes under contract for Leviathan to over 900 MMcf/d. Included in this amount is a new agreement with an existing customer to provide approximately 40 MMcf/d beginning in the second quarter 2018 from Tamar, which will then transfer to Leviathan upon field start-up.

Continued Reliable Offshore Performance

Sales volumes for West Africa in the first quarter 2018 were 56 MBoe/d (30 percent oil), which were less than produced volumes by 2 MBoe/d.  The difference in sales and produced volumes was due to the lifting schedule for the Aseng and Alen fields. Also during the first quarter, the Company achieved more than two years without a recordable safety incident at Aseng and almost four years without a recordable safety incident at Alen.

Quarterly sales volumes in the Gulf of Mexico averaged 24 MBoe/d. The Company closed the sale of the U.S. Gulf of Mexico business on April 12, 2018.

Updated Guidance for ASC 606 and Timing of Portfolio Transactions

The Company's guidance has been updated to reflect the adoption of ASC 606 and the timing of the closing of the Gulf of Mexico transaction. The close of the Gulf of Mexico transaction, which occurred one month earlier than anticipated, impacted prior second quarter expectations by an estimated 7 MBoe/d and full year expectations by nearly 2 MBoe/d. The implementation of ASC 606 resulted in an uplift to second quarter and full year volumes of approximately 9 MBoe/d compared to prior estimates. Accounting for only these specific items, full year 2018 sales volumes have been increased to range between 350 and 360 MBoe/d.

The Company's unit operating expense guidance has been updated to reflect the increase in sales volumes. Compared to the Company's previously issued guidance, LOE per BOE and gathering and transportation expenses per BOE have each been reduced by ten cents.

Sales volumes for the second quarter of 2018 are expected to range between 340 and 350 MBoe/d (post ASC 606). The divestitures of the Gulf of Mexico and the 7.5 percent Tamar interest in Israel account for nearly 30 MBoe/d reduction (20 MBoe/d Gulf of Mexico and 10 MBoe/d Israel) from the first quarter 2018 to the second quarter. Gulf of Mexico sales volumes are included through the April 12, 2018 closing date. West Africa sales volumes are expected to be slightly higher than the first quarter as a result of lifting schedules. U.S. onshore oil volumes are expected to be higher than the first quarter, driven by the Delaware Basin.


5



The Company's full year capital expenditure range of $2.7 to $2.9 billion remains unchanged. For the second quarter, Noble Energy expects organic capital expenditures between $750 million and $850 million, with the majority to be spent in the DJ and Delaware basins and to progress Leviathan development. Second half of 2018 capital expenditures are expected to be lower than the first half reflecting front-end loaded infrastructure spend in the Mustang IDP and the Delaware Basin.

Additional details for first quarter results and guidance can be found in the quarterly supplement on the Company’s website, www.nblenergy.com.


(1)
Reflects historical presentation of sales volume, pre-implementation of ASC 606 accounting standard.
(2)
Pro forma for asset acquisitions and divestitures.
(3)
A Non-GAAP measure, please see the respective earnings release schedules included herein for reconciliations.


Webcast and Conference Call Information

Noble Energy, Inc. will host a live audio webcast and conference call at 8:00 a.m. Central Time on May 1, 2018. The webcast link is accessible on the 'Investors' page at www.nblenergy.com. A replay will be available on the website. Conference call numbers for participation during the question and answer session are:

Toll Free Dial in: 888-882-4478
International Dial in: 323-794-2149
Conference ID: 4898384

Noble Energy (NYSE: NBL) is an independent oil and natural gas exploration and production company with a diversified high-quality portfolio of both U.S. unconventional and global offshore conventional assets. Founded more than 85 years ago, the Company is committed to safely and responsibly delivering our purpose: Energizing the World, Bettering People’s Lives®. For more information, visit www.nblenergy.com.

Investor Contacts
Brad Whitmarsh
(281) 943-1670
Brad.Whitmarsh@nblenergy.com

Megan Dolezal
(281) 943-1861
Megan.Dolezal@nblenergy.com

Lauren Brown
(281) 872-3208
Lauren.Brown@nblenergy.com

Media Contacts
Reba Reid

6



(713) 412-8441
media@nblenergy.com
 
Paula Beasley
(281) 876-6133
media@nblenergy.com

This news release contains certain "forward-looking statements" within the meaning of federal securities laws. Words such as "anticipates", "believes", "expects", "intends", "will", "should", "may", and similar expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect Noble Energy's current views about future events. Such forward-looking statements may include, but are not limited to, future financial and operating results, and other statements that are not historical facts, including estimates of oil and natural gas reserves and resources, estimates of future production, assumptions regarding future oil and natural gas pricing, planned drilling activity, future results of operations, projected cash flow and liquidity, business strategy and other plans and objectives for future operations.  No assurances can be given that the forward-looking statements contained in this news release will occur as projected and actual results may differ materially from those projected. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, without limitation, the volatility in commodity prices for crude oil and natural gas, the presence or recoverability of estimated reserves, the ability to replace reserves, environmental risks, drilling and operating risks, exploration and development risks, competition, government regulation or other actions, the ability of management to execute its plans to meet its goals and other risks inherent in Noble Energy's businesses that are discussed in Noble Energy's most recent annual report on Form 10-K, and in other Noble Energy reports on file with the Securities and Exchange Commission (the "SEC"). These reports are also available from the sources described above. Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. Noble Energy does not assume any obligation to update any forward-looking statements should circumstances or management’s estimates or opinions change.

This news release also contains certain historical non-GAAP measures of financial performance that management believes are good tools for internal use and the investment community in evaluating Noble Energy’s overall financial performance. These non-GAAP measures are broadly used to value and compare companies in the crude oil and natural gas industry. Please see Noble Energy’s respective earnings release for reconciliations of the differences between any historical non-GAAP measures used in this news release and the most directly comparable GAAP financial measures.

7




Schedule 1
Noble Energy, Inc.
Summary Statement of Operations
(in millions, except per share amounts, unaudited) 
 
Three Months Ended March 31,
 
2018 (1)
 
2017
Revenues
 
 
 
Oil, NGL and Gas Sales
$
1,173

 
$
994

Sale of Purchased Oil and Gas
53

 

Income from Equity Method Investees
47

 
42

Midstream Services Revenues – Third Party
13

 

Total Revenues
1,286

 
1,036

Operating Expenses
 
 
 
Lease Operating Expense
155

 
139

Production and Ad Valorem Taxes
54

 
41

Gathering, Transportation and Processing Expense
95

 
119

Other Royalty Expense
17

 
4

Marketing Expense
5

 
19

Exploration Expense
35

 
42

Depreciation, Depletion and Amortization
468

 
528

Purchased Oil and Gas
57

 

General and Administrative
104

 
99

(Gain) on Divestitures
(588
)
 

Asset Impairments
168

 

Other Operating Expense, Net
8

 
10

Total Operating Expenses
578

 
1,001

Operating Income
708

 
35

Other Income
 
 
 
Loss (Gain) on Commodity Derivative Instruments
79

 
(110
)
Interest, Net of Amount Capitalized
73

 
87

Other Non-Operating Expense (Income), Net
13

 
(1
)
Total Other Expense (Income)
165

 
(24
)
Income Before Income Taxes
543

 
59

Income Tax (Benefit) Expense
(31
)
 
12

Net Income and Comprehensive Income Including Noncontrolling Interests
574

 
47

Less: Net Income & Comprehensive Income Attributable to Noncontrolling Interests (2)
20

 
11

Net Income & Comprehensive Income Attributable to Noble Energy
$
554

 
$
36

 
 
 
 
Net Income Attributable to Noble Energy Per Share of Common Stock
 
 
 
Income Per Share, Basic
$
1.14

 
$
0.08

Income Per Share, Diluted
$
1.14

 
$
0.08

 
 
 
 
Weighted Average Number of Shares Outstanding
 
 
 
Basic
487

 
431

Diluted
488

 
434


(1) On January 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers, using the modified retrospective method. As a result of adoption, we have changed the 2018 presentation of certain sales volumes, revenues and expenses related to sales of natural gas and NGLs based on the control model under ASC 606. 2017 information has not been recast to reflect this impact. See Schedule 4.
(2) The Company consolidates Noble Midstream Partners LP (NBLX), a publicly traded subsidiary of Noble Energy, as a variable interest entity for financial reporting purposes. The public's ownership interest in NBLX is reflected as a noncontrolling interest in the financial statements.

8




These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in Noble Energy's Quarterly Report on Form 10-Q to be filed with the Securities and Exchange Commission on May 1, 2018.

9



Schedule 2
Noble Energy, Inc.
Condensed Balance Sheets
(in millions, unaudited)
 
 
March 31, 2018
 
December 31, 2017
Assets
 
 
 
Current Assets
 
 
 
Cash and Cash Equivalents
$
992

 
$
675

Accounts Receivable, Net
707

 
748

Other Current Assets
895

 
780

Total Current Assets
2,594

 
2,203

Net Property, Plant and Equipment
17,431

 
17,502

Other Noncurrent Assets
1,021

 
461

Goodwill
1,402

 
1,310

Total Assets
$
22,448

 
$
21,476

Liabilities and Shareholders' Equity
 
 
 
Current Liabilities
 
 
 
Accounts Payable - Trade
$
1,423

 
$
1,161

Other Current Liabilities
791

 
578

Total Current Liabilities
2,214

 
1,739

Long-Term Debt
6,858

 
6,746

Deferred Income Taxes
976

 
1,127

Other Noncurrent Liabilities
1,013

 
1,245

Total Liabilities
11,061

 
10,857

Total Shareholders' Equity
10,362

 
9,936

Noncontrolling Interests (1)
1,025

 
683

Total Equity
11,387

 
10,619

Total Liabilities and Equity
$
22,448

 
$
21,476


(1) The Company consolidates Noble Midstream Partners LP (NBLX), a publicly traded subsidiary of Noble Energy, as a variable interest entity for financial reporting purposes. The public's ownership interest in NBLX is reflected as a noncontrolling interest in the financial statements.

These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in Noble Energy's Quarterly Report on Form 10-Q to be filed with the Securities and Exchange Commission on May 1, 2018.















10



Schedule 3
Noble Energy, Inc.
Condensed Statement of Cash Flows
(in millions, unaudited)
 
Three Months Ended March 31,
 
2018
 
2017
Cash Flows From Operating Activities
 
 
 
Net Income Including Noncontrolling Interests (1)
$
574

 
$
47

Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities
 
 
 
Depreciation, Depletion and Amortization
468

 
528

Asset Impairments
168

 

Deferred Income Tax Benefit
(157
)
 

Loss (Gain) on Commodity Derivative Instruments
79

 
(110
)
Net Cash Received in Settlement of Commodity Derivative Instruments
(28
)
 
3

Gain on Divestitures
(588
)
 

Other Adjustments for Noncash Items Included in Income
(2
)
 
20

Net Changes in Working Capital
69

 
48

Net Cash Provided by Operating Activities
583

 
536

Cash Flows From Investing Activities
 
 
 
Additions to Property, Plant and Equipment
(787
)
 
(587
)
Acquisitions, Net of Cash Acquired(2)
(650
)
 
(346
)
Proceeds from Sale of 7.5% Interest in Tamar and Dalit Fields
487

 

Proceeds from Sale of CONE Gathering LLC
308

 

Proceeds from Divestitures and Other
70

 
40

Net Cash Used in Investing Activities
(572
)
 
(893
)
Cash Flows From Financing Activities
 
 
 
Dividends Paid, Common Stock
(48
)
 
(44
)
Purchase and Retirement of Common Stock
(67
)
 

Proceeds from Noble Midstream Services Revolving Credit Facility
350

 

Contributions from Noncontrolling Interest and Other
333

 

Repayment of Revolving Credit Facility
(230
)
 

Other
(40
)
 
(22
)
Net Cash Provided by (Used in) Financing Activities
298

 
(66
)
Increase (Decrease) in Cash, Cash Equivalents, and Restricted Cash
309

 
(423
)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period(3)
713

 
1,210

Cash, Cash Equivalents, and Restricted Cash at End of Period(4)
$
1,022

 
$
787


(1) The Company consolidates Noble Midstream Partners LP (NBLX), a publicly traded subsidiary of Noble Energy, as a variable interest entity for financial reporting purposes. For the three months ended March 31, 2018 and 2017, Net Income includes Net Income Attributable to Noncontrolling Interests in NBLX.
(2) For the three months ended March 31, 2018, acquisitions, net of cash acquired relates to 100 percent of the acquisition of Saddle Butte Rockies Midstream, LLC.
(3) As of the beginning of the periods presented, includes $38 million and $30 million of restricted cash, respectively.
(4) Includes $30 million of restricted cash as of March 31, 2018.


These financial statements should be read in conjunction with the financial statements and the accompanying notes and other information included in Noble Energy's Quarterly Report on Form 10-Q to be filed with the Securities and Exchange Commission on May 1, 2018.

11



Schedule 4
Noble Energy, Inc.
Volume and Price Statistics
(unaudited)
 
 
Three Months Ended
 
 
March 31,
Sales Volumes
 
2018 (1)
Post ASC 606 Adoption
 
2018 (1)
Pre ASC 606 Adoption
 
2017
As Reported
Crude Oil and Condensate (MBbl/d)
 
 
 
 
 
 
United States Onshore
 
103

 
103

 
75

United States Gulf of Mexico
 
19

 
19

 
24

Equatorial Guinea
 
15

 
15

 
18

Equity Method Investee - Equatorial Guinea
 
2

 
2

 
2

Total
 
139


139

 
119

Natural Gas Liquids (MBbl/d)
 
 
 
 
 
 
United States Onshore(1)
 
63

 
59

 
47

United States Gulf of Mexico
 
1

 
1

 
2

Equity Method Investee - Equatorial Guinea
 
5

 
5

 
6

Total
 
69

 
65

 
55

Natural Gas (MMcf/d)
 
 
 
 
 
 
United States Onshore(1)
 
482

 
451

 
707

United States Gulf of Mexico
 
22

 
22

 
23

Israel
 
261

 
261

 
271

Equatorial Guinea
 
206

 
206

 
244

Total
 
971

 
940

 
1,245

Total Sales Volumes (MBoe/d)
 
 
 
 
 
 
United States Onshore
 
246

 
237

 
240

United States Gulf of Mexico
 
24

 
24

 
30

Israel
 
44

 
44

 
46

Equatorial Guinea
 
49

 
49

 
58

Equity Method Investee - Equatorial Guinea
 
7

 
7

 
8

Total Sales Volumes (MBoe/d)
 
370

 
361

 
382

 
 
 
 
 
 
 
Total Sales Volumes (MBoe)
 
33,252

 
32,413

 
34,334

 
 
 
 
 
 
 
Price Statistics - Realized Prices (2)
 
 
 
 
 
 
Crude Oil and Condensate ($/Bbl)
 
 
 
 
 
 
United States Onshore
 
$
61.50

 
$
61.50

 
$
48.88

United States Gulf of Mexico
 
64.55

 
64.55

 
49.49

Equatorial Guinea
 
68.14

 
68.14

 
53.42

Natural Gas Liquids ($/Bbl)
 
 
 
 
 
 
United States Onshore(1)
 
$
25.47

 
$
26.33

 
$
23.85

United States Gulf of Mexico
 
28.41

 
29.51

 
27.05

Natural Gas ($/Mcf)
 
 
 
 
 
 
United States Onshore(1)
 
$
2.60

 
$
2.77

 
$
3.45

United States Gulf of Mexico
 
3.54

 
3.54

 
3.14

Israel
 
5.48

 
5.48

 
5.32

Equatorial Guinea
 
0.27

 
0.27

 
0.27


(1) On January 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers, using the modified retrospective method. As a result of adoption, and effective first quarter 2018, we have changed the presentation of certain sales volumes, revenues and expenses related to sales of

12



natural gas and NGLs based on the control model under ASC 606. For comparability purposes, we have presented revenues, expenses and volumes under the new guidance per ASC 606 as well as under the pre ASC 606 for first quarter 2018. 2017 information has not been recast to reflect this impact.
(2) Average realized prices do not include gains or losses on commodity derivative instruments.

13



Schedule 5
Noble Energy, Inc.
Reconciliation of Net Income Attributable to Noble Energy and Per Share (GAAP) to
Adjusted Income (Loss) Attributable to Noble Energy and Per Share (Non-GAAP)
(in millions, except per share amounts, unaudited)

Adjusted income (loss) attributable to Noble Energy and per share (Non-GAAP) should not be considered an alternative to, or more meaningful than, net income attributable to Noble Energy and per share (GAAP) or any other measure as reported in accordance with GAAP. Our management believes, and certain investors may find, that adjusted income (loss) attributable to Noble Energy and per share (Non-GAAP) is beneficial in evaluating our operating and financial performance because it eliminates the impact of certain noncash and/or nonrecurring items that management does not consider to be indicative of our performance from period to period. We believe this Non-GAAP measure is used by analysts and investors to evaluate and compare our operating and financial performance across periods. As a performance measure, adjusted income (loss) attributable to Noble Energy and per share (Non-GAAP) may be useful for comparison of earnings and per share to forecasts prepared by analysts and other third parties. However, our presentation of adjusted income (loss) attributable to Noble Energy and per share (Non-GAAP), may not be comparable to similar measures of other companies in our industry.
 
Three Months Ended March 31,
 
2018
 
2017
Net Income Attributable to Noble Energy (GAAP)
$
554

 
$
36

Adjustments to Net Income
 
 
 
Gain on Divestitures
(588
)
 

Loss (Gain) on Commodity Derivative Instruments, Net of Cash Settlements
51

 
(107
)
Undeveloped Leasehold Impairment

 
18

Loss on Investment in Tamar Petroleum Ltd., Net 
29

 

Asset Impairments
168

 

Other Adjustments
18

 
2

Total Adjustments Before Tax
(322
)
 
(87
)
Current Income Tax Effect of Adjustments (1)
113

 
(2
)
Deferred Income Tax Effect of Adjustments (1)
(173
)
 
30

Adjustments to Net Income, After Tax
$
(382
)
 
$
(59
)
Adjusted Net Income (Loss) Attributable to Noble Energy (Non-GAAP)
$
172

 
$
(23
)
 
 
 
 
Net Income Attributable to Noble Energy Per Share, Basic and Diluted (GAAP)
$
1.14

 
$
0.08

Gain on Divestitures
(1.21
)
 

Loss (Gain) on Commodity Derivative Instruments, Net of Cash Settlements
0.10

 
(0.25
)
Undeveloped Leasehold Impairment

 
0.04

Loss on Investment in Tamar Petroleum Ltd., Net
0.06

 

Asset Impairments
0.34

 

Other Adjustments
0.05

 
0.01

Current Income Tax Effect of Adjustments (1)
0.23

 

Deferred Income Tax Effect of Adjustments (1)
(0.36
)
 
0.07

Adjusted Net Income (Loss) Attributable to Noble Energy Per Share, Diluted (Non-GAAP)
$
0.35

 
$
(0.05
)
 
 
 
 
Weighted Average Number of Shares Outstanding, Basic
487

 
431

Weighted Average Number of Shares Outstanding, Diluted
488

 
434


(1) Amount represents the income tax effect of adjustments, determined for each major tax jurisdiction for each adjusting item, including the impact of timing and magnitude of divestiture activities.

14



Schedule 6
Noble Energy, Inc.
Reconciliation of Net Income Including Noncontrolling Interest (GAAP) to Adjusted EBITDAX (Non-GAAP)
(in millions, unaudited)

Adjusted Earnings Before Interest Expense, Income Taxes, Depreciation, Depletion and Amortization, and Exploration Expenses (Adjusted EBITDAX) (Non-GAAP) should not be considered an alternative to, or more meaningful than, net income including noncontrolling interest (GAAP) or any other measure as reported in accordance with GAAP. Our management believes, and certain investors may find, that Adjusted EBITDAX (Non-GAAP) is beneficial in evaluating our operating and financial performance because it eliminates the impact of certain noncash and/or nonrecurring items that management does not consider to be indicative of our performance from period to period. We believe these Non-GAAP measures are used by analysts and investors to evaluate and compare our operating and financial performance across periods. As a performance measure, Adjusted EBITDAX (Non-GAAP) may be useful for comparison to forecasts prepared by analysts and other third parties. However, our presentation of Adjusted EBITDAX (Non-GAAP) may not be comparable to similar measures of other companies in our industry.
 
Three Months Ended March 31,
 
2018
 
2017
Net Income Including Noncontrolling Interest (GAAP)
$
574

 
$
47

Adjustments to Net Income, After Tax(1)
(382
)
 
(59
)
Depreciation, Depletion, and Amortization
468

 
528

Exploration Expense(2)
35

 
24

Interest, Net of Amount Capitalized
73

 
87

Current Income Tax Expense(3)
13

 
14

Deferred Income Tax Expense (Benefit)(3)
16

 
(30
)
Adjusted EBITDAX (Non-GAAP)
$
797

 
$
611


(1) See Schedule 5: Reconciliation of Net Income (Loss) Attributable to Noble Energy (GAAP) to Adjusted Income (Loss) Attributable to Noble Energy (Non-GAAP).
(2) Represents remaining Exploration Expense after reversal of Adjustments to Net Income, After Tax, above.
(3) Represents remaining Income Tax Expense (Benefit) after reversal of Adjustments to Net Income, After Tax, above.

Capital Expenditures
(in millions, unaudited)
 
Three Months Ended March 31,
 
2018
 
2017
Organic Capital Expenditures, Attributable to Noble Energy (Accrual Based)
$
781

 
$
616

Acquisition Capital Attributable to Noble Energy

 
323

NBLX Capital Expenditures (4)
345

 
60

Total Reported Capital Expenditures (Accrual Based)
$
1,126

 
$
999


(4) NBLX Capital Expenditures for the three months ended March 31, 2018 includes $206 million related to the acquisition of Saddle Butte Rockies Midstream, LLC.








15
ex9921q18supplementalfin
First Quarter Supplement May 2018


 
www.nblenergy.com NYSE: NBL 1Q18 Key Highlights Positioned for long-term value creation 2 Strengthened Financial Position and Prioritized Shareholder Returns Executed Several Strategic Accomplishments Midstream Integration Providing Operational Advantages Strong Operational Execution and Cost Control • Repurchased 9% of $750 million share repurchase program; increased quarterly dividend 10% in April • Repaid $230 MM of NBL debt • Exited 1Q18 with over $5 B in liquidity, including cash and undrawn NBL credit facility • Executed sales agreements for Tamar and Leviathan gas to customers in Egypt; > 900 MMcf/d now under contract for Leviathan Phase I • Closed the sale of 7.5% WI of Tamar and the Marcellus midstream assets • Continued the portfolio transformation with the sale of the Gulf of Mexico assets • Delivered 361 MBoe/d(1), 18%(2) increase from 1Q17, on organic capital expenditures of $781 MM • Strong U.S. onshore oil volumes, up over 30%(2) from 1Q17 • Record 1Q gross sales volumes in Israel of 959 MMcfe/d • Third central gathering facility (operated by NBLX) online in Delaware Basin in March, first facility on legacy CWEI acreage • Record 162 MBoe/d oil and gas gathering volumes from NBLX operated systems (1) Reflects the historical presentation of sales volumes pre-implementation of ASC 606 accounting standard. 1Q18 sales volumes totaled 370 MBoe/d post ASC 606 implementation. (2) Adjusted for acquisitions and divestitures.


 
www.nblenergy.com NYSE: NBL 1Q18 Actuals vs. Guidance Strong earnings and cash flow start to 2018 3 Financial & Operating Metrics 1Q Guidance 1Q Actuals(1) Total Sales Volumes (MBoe/d) 358 – 368 361 Oil (MBbl/d) 137 – 144 139 Natural Gas Liquids (MBbl/d) 64 – 68 65 Natural Gas (MMcf/d) 925 – 950 940 Organic Capital(2) ($MM) 750 – 850 781 Lease Operating ($/BOE) 4.40 – 4.70 4.78 Gathering, Transportation & Processing ($/BOE) 3.20 – 3.50 2.93 Production Taxes (% Oil, NGL, Gas Revenues) 4.4 – 4.8 4.6 DD&A ($/BOE) 14.00 – 14.75 14.44 Marketing ($MM) 8 – 12 5 Exploration ($MM) 40 – 60 35 G&A ($MM) 100 – 110 104 Interest, net ($MM) 70 – 85 73 Equity Investment Income ($MM) 35 – 50 47 Midstream Services Revenue – Third Party 10 – 20 13 Noncontrolling Interest – NBLX Public Unitholders 25 – 35 20 Adjusted Earnings 1Q ($MM) Net Income attributable to NBL (GAAP) 554 Adjustments to Net Income, Before Tax (322) Adjusted Net Income attributable to NBL, Before Tax 232 Current Income Tax Effect of Adjustments 113 Deferred Income Tax Effect of Adjustments (173) Adjusted Net Income Attributable to NBL(3) (Non-GAAP) 172 Adjusted EBITDAX 1Q ($MM) Net Income Including Noncontrolling Interest (GAAP) 574 Adjustments to Net Income, After Tax (382) DD&A 468 Exploration 35 Interest, net 73 Current Income Tax Expense, Adjusted 13 Deferred Income Tax Expense, Adjusted 16 Adjusted EBITDAX(3) (Non-GAAP) 797 (1) Reflects the historical presentation of sales volumes pre-implementation of ASC 606 accounting standard for more accurate comparison to guidance. 1Q18 sales volumes totaled 370 MBoe/d post ASC 606 implementation. (2) Includes only NBL-funded portion of midstream capital expenditures. (3) Non-GAAP reconciliation to GAAP measure available in 1Q18 earnings release.


 
www.nblenergy.com NYSE: NBL 4 Strengthened Financial Position Prudent financial management: a pillar of NBL’s business success Progressing Shareholder Return • Repurchased $67.5 MM outstanding shares, 9% of $750 MM share repurchase program • 10% dividend increase with 1Q18 raise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Accomplished Over $600 MM NBL Debt Reduction Objective • Repaid $230 MM of NBL debt in 1Q18 • Additional $379 MM reduction in 2Q18 removes legacy ROSE debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Investment Grade Credit Rating Reaffirmed • Fitch revised outlook to positive from stable • S&P revised outlook to stable from negative 0.0 2.0 4.0 6.0 1Q17 4Q17 1Q18 Available NBL Revolver Cash Increased Liquidity to Over $5 B $ B > $2.5 B NBL debt reduction since beginning of 2016 > $600 MM NBL debt reduction YTD in 2018


 
www.nblenergy.com NYSE: NBL U.S. Onshore Delivering increasing oil volume growth through 2018 5 (1) Adjusted for acquisitions and divestitures. (2) Reflects the historical presentation of sales volumes, pre-implementation of ASC 606 accounting standard. 1Q18 Total U.S. Onshore sales volumes totaled 246 MBoe/d and 1Q18 DJ Basin sales volumes totaled 120 MBoe/d post ASC 606 implementation. 1Q18 Key Highlights U.S. Onshore Oil Volumes of 103 MBbl/d • Up over 30%(1) from 1Q17 • Delaware oil up 19% from 4Q17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Continued Advancing Drilling Efficiencies • Increased drilled footage per day in 1Q18 by 3% in DJ, 10% in Delaware and 7% in Eagle Ford vs. 2017 average . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Progressed Midstream Build-out in Support of Upstream Development • Completed 3rd CGF in the Delaware Basin • Building econode facilities, gathering and transport infrastructure in Mustang IDP (DJ Basin) 0 wells online 2 avg. operated rigs; 14 wells drilled 5 wells completed Eagle Ford 13 wells online; 8,430 avg. lateral length 6 avg. operated rigs; 20 wells drilled 18 wells completed Delaware, Permian Basin 31 wells online; 7,400 avg. lateral length 1 avg. operated rig; 11 wells drilled 18 wells completed DJ Basin 1Q18 Sales Volumes DJ Basin(1) Delaware Eagle Ford Total(1) Oil (MBbl/d) 62 31 10 103 NGL (MBbl/d) 18 7 34 59 Gas (MMcf/d) 187 42 222 451 Total Sales (MBoe/d) 111 45 81 237 Note: Represents NBL operated activity.


 
www.nblenergy.com NYSE: NBL 6 U.S. Onshore Marketing Diversification provides price optionality and flow assurance Multiple Options for Crude Oil End-markets • All DJ Basin crude priced at Cushing • Growing portion of Permian oil connected through central gathering facilities (CGFs) and transported via Advantage Pipeline (NBLX operated) • Permian oil sold in basin to buyers with firm takeaway • Securing firm transport for Permian oil takeaway on EPIC crude pipeline to Corpus Christi (2H19 startup) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Less than 20% of 2018 U.S. Onshore Oil Currently Subject to Midland Basis Pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Long-term Firm Processing Agreement for Permian Natural Gas and NGL Extraction • Products sold in basin to party with extensive midstream and downstream assets Diversified Crude Pricing Exposure(1) Permian Eagle Ford DJ Basin Cushing Houston Corpus Christi Cushing Midland Mid/Cush Hedges Gulf Coast 2018E USO Pricing 2020E USO Pricing (1) As of 4/30/2018. Cushing Midland Gulf Coast


 
www.nblenergy.com NYSE: NBL 117,000 Net acres 3,800 Gross locations(1) 7,800 ft Average lateral Length 2 BBoe Net unrisked resources(1) 1Q17 2Q17 3Q17 4Q17 1Q18 0 10 20 30 40 50 Total Oil (MBbl/d) Delaware Basin Progressing full-field development 7 Solid Execution Start to 2018 • 19% oil growth from 4Q17 • 13 wells online in 1Q, all multi-well pads and multi-zone development with 9 wells flowing through CGFs • Operating 6 rigs and 3 frac crews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Progressing Midstream Infrastructure Build-out • 3rd CGF completed in 1Q18, 1st servicing legacy CWEI acreage • 2 additional CGFs online by end of 2Q18, expanding oil takeaway capacity to 90 MBbl/d • All CGFs connected and flowing through Advantage pipeline . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Driving Operating Efficiencies from Multi-well Pads and Longer Laterals • 26% reduction in completion cycle time from multi-well pads in 1Q18 vs. single well development in 2017 • Increased wells online lateral length by 24% vs. 2017 average Delaware Basin Net Production Delivering High Margin Growth MBoe/d Ward Pecos Reeves NBL Acreage (1) Locations and resources estimate effective as of beginning of 2018. TX


 
www.nblenergy.com NYSE: NBL 8 Delaware Basin 1Q18 Activity Multi-well pad development across multiple zones Reeves NBL Acreage CGFs Online 2Q18 CGF Calamity Jane 7-well Pad  2 3rd Bone Spring, avg. IP-90 ~2,000 Boe/d  3 Wolfcamp A Upper, avg. IP-90 ~1,620 Boe/d  2 Wolfcamp A Lower, avg. IP-90 ~730 Boe/d  Online late 4Q17, 7,000 ft avg. lateral length, 70% oil 1Q18 Multi-Well Pads  6 wells in North and 7 wells in South  5 Wolfcamp A Upper, 6 Wolfcamp A Lower, 1 3rd Bone Spring and 1 Wolfcamp C  8,440 ft total avg. laterals Extended Calamity Jane Results Exhibiting Flatter Declines • Wolfcamp A Upper and 3rd Bone Spring continue to outperform expectations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Continued Strong Well Results Across Acreage • 9 of 11 Wolfcamp A wells ranged from 1,000 – 2,400 Boe/d IP-30 with 78% average oil mix • Managing flowback (IPs) on longer laterals • Certain wells drilled to hold acreage • Continue to be encouraged by initial results from other zones . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Extending Long Lateral and Multi-well Pad Development into Legacy CWEI Acreage • Pace of development aligned with infrastructure buildout • First 3-well pad tied into 3rd NBLX operated CGF, 1st CGF servicing legacy CWEI acreage • First 10,000+ ft laterals showing flatter declines 1Q18 pads


 
www.nblenergy.com NYSE: NBL Delaware Basin Produced Water Management Increasing operational flexibility and value 9 < [VALUE] 9% > 30% 0% 10% 20% 30% 40% 50% 2017 Avg. 1Q18 YE18 Target Substantially Increasing Use of Recycled Water for Completions Kingfisher Water Facility Infrastructure Strategically Designed with Produced Water Recycling and Disposal Options for Flow Assurance • NBL recycle facilities and pond storage • Increasing NBL operated vs. 3rd party SWD capacity • Reduces footprint and removes truck usage for water hauling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Establishing Water Pipeline Network Across Acreage Position • Increasing ability to utilize recycled water in completions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Expanding Recycling Efforts in 2018 • Over 1 MMBbl produced water recycled since late 2017 • Initial wells using recycled water performing in-line with expectations • Reduces need for disposal and use of fresh water in completions


 
www.nblenergy.com NYSE: NBL 335,000 Net acres 2,350 Gross locations(3) 9,800 ft Average lateral Length 1.7 BBoe Net unrisked resources(3) 10 DJ Basin Strong execution and cash flow generation 0 25 50 75 100 1Q17 2Q17 3Q17 4Q17 1Q18 MBoe/d (1) Before tax operating cash flow (not including corporate burden) less capital investments (excluding NBLX capital). (2) Reflects the historical presentation of sales volumes, pre-implementation of ASC 606 accounting standard. 1Q18 DJ Basin oil mix totaled 52% post ASC 606 implementation. (3) Locations and resources estimate effective as of beginning of 2018. CO Weld Wells Ranch East Pony Mustang NBL Acreage Municipalities Low GOR: Mid High Wells Ranch and East Pony Sales Volumes(2) > 40% growth vs. 1Q17 Solid Operational Execution in 1Q18 • Over $100 MM asset level free cash flow(1) • Record oil mix of 56%(2) • Record combined volumes(2) of 88 MBoe/d from Wells Ranch and East Pony . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Volumes Return to Growth in 2H18 • 2Q18 volumes expected slightly lower than 1Q18 with planned third party processing turn-around • Adding 2nd rig and 3rd frac crew in 2Q18 • Timing Mustang wells online in coordination with infrastructure expansion • Developing Wells Ranch to maximize CGF throughput


 
www.nblenergy.com NYSE: NBL 11 DJ Basin Continued outstanding well results Wells Ranch Mustang Kona Wells 3 4 9 + wells with 3,600 lbs/ft proppant, 10,500+ ft. lateral wells with 2,800 lbs/ft proppant, 10,500+ ft. lateral MBoe/d gross current rate total at 70% oil after 65 days, still inclining 30 Mustang IDP 1.3 MMBoe type curve for 9,500 ft lateral, 1,800 lbs/ft proppant standard design wells planned to be online by year-end 2018 in lower GOR area Wells Ranch High Proppant Concentration Wells Showing Exceptional Productivity • Wells utilized controlled flowback and are maintaining higher pressure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Currently Completing First Pads in Southern Mustang • Utilizing learnings from Wells Ranch • NBLX laying backbone gathering infrastructure (75% NBL owned, 25% NBLX) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Secured Multiple Outlets for Gas Processing in Mustang • Diversified processing capacity and various offload points for flexibility of takeaway • Protected through compression, applying Wells Ranch learnings


 
www.nblenergy.com NYSE: NBL 12 Noble Midstream (NBLX) Peer-leading distribution growth and growing third-party services DJ Basin Highlights Delaware Basin Highlights 24% increase in 1Q18 fresh water delivery compared to 4Q17 20% targeted annual distribution growth 2.3x distribution coverage with a strong balance sheet 162 MBoe/d record quarterly oil and gas volumes gathered in 1Q • Delivering CGF Construction to Plan in Support of NBL Delaware Volume Growth  Coronado (3rd CGF in basin) online in 2Q18  Billy Miner II (4th CGF in basin) online in late April  Collier (5th CGF in basin) expected online by end of 2Q18 • All CGFs Connecting through Advantage System by Mid-year • Grew Advantage Pipeline Oil Throughput to 88 MBbl/d; 47% increase from 4Q17 • Expanding Advantage Pipeline Capacity to 200 MBbl/d by End of 3Q18 • Record Wells Ranch and East Pony Volumes Gathered • Construction Underway on Mustang IDP Gathering Infrastructure, Online by Mid-2018  Began fresh water delivery in March  Spec oil, gas and water system expected online by mid-year • Closed Acquisition of Saddle Butte and Successfully Integrated Operations  Planned connection for Mustang volumes • Planning for Significant 2H18 Activity and Throughput Ramp


 
www.nblenergy.com NYSE: NBL 33,000 Net acres 320 Gross locations(1) 6,400 ft Average lateral Length 400 MMBoe Net unrisked resources(1) 13 Eagle Ford Maximizing cash flows Eagle Ford Net Production Volumes Trending as Expected 0 25 50 75 100 1Q17 2Q17 3Q17 4Q17 1Q18 MBoe/d TX Dimmit Gates Ranch NBL Acreage Webb (1) Locations and resources estimate effective as of beginning of 2018. Cash Flow Generation from Significant 2017 Volume Ramp • 1Q18 sales volumes of 81 MBoe/d, up nearly 2x vs. 1Q17 • ~3 MBoe/d facility down-time impacts to 1Q18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2018 Wells Online in North Gates Ranch • 5-well pad co-development of Upper and Lower Eagle Ford wells online in 2Q18 • 4-well pad targeting Lower Eagle Ford expected online in 2Q18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Strong Safety Performance • 185 days no lost time or recordable incidents


 
www.nblenergy.com NYSE: NBL 14 Eastern Mediterranean Growing natural gas demand with stable long-term cash flows Tamar 25% WI Tamar SW 25% WI Tel Aviv Ashdod Israel Egypt Aphrodite 35% WI Leviathan 39.7% WI Dor Discovery Existing Pipeline Planned Pipeline Field Development NBL Interests Producing 0 250 500 750 1,000 Tamar Gross Production MMcfe/d 1Q 2Q 3Q 4Q 2014 1Q 2Q 3Q 4Q 2015 1Q 2Q 3Q 4Q 2016 1Q 2Q 3Q 4Q 2017 1Q 2QE 2018 1Q 2Q 3Q 4Q 2013 Record 1Q Gross Sales Volumes of 959 MMcfe/d; Net Sales Volumes at 263 MMcfe/d • Strong price realizations of $5.48/Mcf • Zero recordable incidents in the first quarter • Tamar gross cumulative production of 1.5 Tcf • Closed sale of 7.5% Tamar working interest in March 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Over 900 MMcf/d Total Volume Under Contract for Leviathan • Signed 350 MMcf/d firm contract to Dolphinus (Egypt) for 10 years supplying industrial and power generation customers • ~40 MMcf/d agreement for gas from Tamar and then Leviathan (upon field start-up) supplying existing power generation in Israel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Executed Interruptible Contract for up to 350 MMcf/d to Dolphinus (Egypt) from Tamar


 
www.nblenergy.com NYSE: NBL 15 Leviathan Development Major project progressing towards first gas sales by year-end 2019 Leviathan Development On Track; ~45% complete • Construction of the platform is progressing • Drilling rig arrived on-site in March and drilled Leviathan-3 well to TD in early April • Pipe lay vessel is on-site, completed installation of 14” infield flowlines and installing 18” takeaway pipelines • Project remains on schedule and on budget Construction of Leviathan Platform Project Phase 2017 2018 2019 Sanction Order Critical Path Equipment Detail Design and Engineering Pipeline Manufacturing Equipment Manufacturing Commissioning and First Gas Drilling and Completions Offshore Platform Installation Pipe Lay Vessel Ensco DS-7 Drill Ship


 
www.nblenergy.com NYSE: NBL Other Global Offshore Continued exceptional operational and safety performance Reliable Performance at West Africa • West Africa sales volumes of 56 MBoe/d (30% oil) • Exceeded 2 years at Aseng and almost 4 years at Alen without a recordable safety incident • Strong West Africa volumes in 2Q expected from multiple liftings, anticipated to be underlifted in 3Q . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Progressing Negotiations with all Stakeholders to Monetize Significant Discovered Gas in EG and Cameroon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Closed Sale of Gulf of Mexico Business on April 12th • Earlier than anticipated closing due to Fieldwood’s successful restructuring • Volumes included in 2Q guidance through closing date 16 Equatorial Guinea Cameroon Aseng 40% WI Methanol Plant 45% WI LPG Plant 28% WI Bioko Island Alen 45% WI Alba Field 33% WI Producing NBL Interests Yoyo Yolanda Discoveries Alen Platform, West Africa


 
www.nblenergy.com NYSE: NBL 17 Appendix


 
www.nblenergy.com NYSE: NBL 18 Forward-Looking Statements and Other Matters This presentation contains certain "forward-looking statements" within the meaning of federal securities laws. Words such as "anticipates", "believes“, "expects", "intends", "will", "should", "may", and similar expressions may be used to identify forward-looking statements. Forward-looking statements are not statements of historical fact and reflect Noble Energy's current views about future events. Such forward-looking statements may include, but are not limited to, future financial and operating results, and other statements that are not historical facts, including estimates of oil and natural gas reserves and resources, estimates of future production, assumptions regarding future oil and natural gas pricing, planned drilling activity, future results of operations, projected cash flow and liquidity, business strategy and other plans and objectives for future operations. No assurances can be given that the forward-looking statements contained in this presentation will occur as projected and actual results may differ materially from those projected. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks and uncertainties that could cause actual results to differ materially from those projected. These risks and uncertainties include, without limitation, the volatility in commodity prices for crude oil and natural gas, the presence or recoverability of estimated reserves, the ability to replace reserves, environmental risks, drilling and operating risks, exploration and development risks, competition, government regulation or other actions, the ability of management to execute its plans to meet its goals and other risks inherent in Noble Energy's businesses that are discussed in Noble Energy's most recent annual reports on Form 10-K, respectively, and in other Noble Energy reports on file with the Securities and Exchange Commission (the "SEC"). These reports are also available from the sources described above. Forward-looking statements are based on the estimates and opinions of management at the time the statements are made. Noble Energy does not assume any obligation to update any forward-looking statements should circumstances or management’s estimates or opinions change. The SEC requires oil and gas companies, in their filings with the SEC, to disclose proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. The SEC permits the optional disclosure of probable and possible reserves, however, we have not disclosed our probable and possible reserves in our filings with the SEC. We may use certain terms in this presentation, such as “net unrisked resources”, which by their nature are more speculative than estimates of proved, probable and possible reserves and accordingly are subject to substantially greater risk of being actually realized. The SEC guidelines strictly prohibit us from including these estimates in filings with the SEC. Investors are urged to consider closely the disclosures and risk factors in our most recent Form 10-K and in other reports on file with the SEC, available from Noble Energy’s offices or website, http://www.nblenergy.com. This presentation also contains certain non-GAAP measures of financial performance that management believes are good tools for internal use and the investment community in evaluating Noble Energy’s overall financial performance. These non-GAAP measures are broadly used to value and compare companies in the crude oil and natural gas industry. Please see the attached schedules for reconciliations of the differences between any historical non-GAAP measures used in this presentation and the most directly comparable GAAP financial measures.


 
www.nblenergy.com NYSE: NBL 19 Second Quarter 2018 Guidance Capital & Cost Metrics Capital Expenditures(2) ($MM) Total Company Organic Capital $750 - $850 Cost Metrics LOW HIGH Lease Operating Expense ($/BOE) 3.70 4.00 Gathering, Transportation & Processing ($/BOE) 3.30 3.60 Production Taxes (% Oil, Gas, NGL Revenues) 4.5 4.9 Marketing ($MM) 8 12 DD&A ($/BOE) 14.00 14.75 Exploration ($MM) 30 50 G&A ($MM) 100 110 Interest, net ($MM) 70 80 Other Guidance Items ($MM) Equity Investment Income 35 50 Midstream Services Revenue – Third Party 10 20 Non-Controlling Interest – NBLX Public Unitholders 10 20 2Q 2018 Sales Volume Crude Oil and Condensate (MBbl/d) Natural Gas Liquids (MBbl/d) Natural Gas (MMcf/d) Total Equivalent (MBoe/d) Low High Low High Low High Low High United States Onshore 103 108 60 64 460 485 240 250 United States Gulf of Mexico(1) 4 4 - - 4 4 4 5 Israel - - - - 200 220 33 37 Equatorial Guinea 15 19 - - 205 225 51 56 Equatorial Guinea - Equity method investment 1 2 5 6 - - 6 7 Total Company 124 132 65 70 885 910 340 350 (1) U.S. Gulf of Mexico volumes are included in sales guidance through closing April 12, 2018. (2) Includes only NBL-funded portion of midstream capital expenditures.


 
www.nblenergy.com NYSE: NBL 20 Full-Year 2018 Guidance Capital & Cost Metrics Capital Expenditures(2) ($MM) Total Company Organic Capital $2,700 - $2,900 Cost Metrics LOW HIGH Lease Operating Expense ($/BOE) 3.80 4.20 Gathering, Transportation & Processing ($/BOE) 3.15 3.50 Production Taxes (% Oil, Gas, NGL Revenues) 4.7 5.1 Marketing ($MM) 35 50 DD&A ($/BOE) 14.50 15.25 Exploration ($MM) 125 150 G&A ($MM) 400 430 Interest, net ($MM) 260 300 Other Guidance Items ($MM) Equity Investment Income 160 200 Midstream Services Revenue – Third Party 60 80 Non-Controlling Interest – NBLX Public Unitholders 80 105 Full-Year 2018 Sales Volume Crude Oil and Condensate (MBbl/d) Natural Gas Liquids (MBbl/d) Natural Gas (MMcf/d) Total Equivalent (MBoe/d) Low High Low High Low High Low High United States Onshore 111 117 61 66 460 490 252 262 United States Gulf of Mexico(1) 5 6 - 1 6 7 6 7 Israel(1) - - - - 215 240 36 40 Equatorial Guinea 13 17 - - 185 210 45 50 Equatorial Guinea - Equity method investment 1 2 5 5 - - 6 7 Total Company 133 139 68 72 895 920 350 360 (1) U.S. Gulf of Mexico volumes are included in sales guidance through closing April 12, 2018. Israel sales volumes reflect divestment of 7.5% interest in Tamar on March 11, 2018. (2) Includes only NBL-funded portion of midstream capital expenditures.


 
Investor Relations Contacts Brad Whitmarsh Megan Dolezal Lauren Brown 281.943.1670 281.943.1861 281.872.3208 brad.whitmarsh@nblenergy.com megan.dolezal@nblenergy.com lauren.brown@nblenergy.com Visit us on the Investor Relations Homepage at www.nblenergy.com