Noble Energy Inc.
NOBLE ENERGY INC (Form: 8-K, Received: 08/03/2017 07:29:11)


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): August 3, 2017

  NBLLOGOUPDATED9302014A23.JPG

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 August 3, 2017 Noble Energy, Inc. (the “Company”) issued a press release announcing results for the fiscal quarter ended June 30, 2017 . 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 June 30, 2017 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. Other Events.
On August 3, 2017, we will present certain information in connection with our call with stockholders, 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 August 3, 3017 announcing results for the fiscal quarter ended June 30, 2017.
 
99.2
Second Quarter 2017 Supplement 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:
August 3, 2017
 
 
By: 
 
/s/ Kenneth M. Fisher
 
 
 
 
 
 
Kenneth M. Fisher
 
 
 
 
 
 
Executive Vice President, Chief Financial Officer





INDEX TO EXHIBITS
 
 
 
 
Exhibit No.
  
Description
 
 
99.1
  
Press Release dated August 3, 3017 announcing results for the fiscal quarter ended June 30, 2017.
99.2
 
Second Quarter 2017 Supplement slide presentation.




 

NBLLOGOUPDATED9302014A22.JPG
  
 
NEWS RELEASE
 
 
 
 
 
 
 

NOBLE ENERGY ANNOUNCES SECOND QUARTER 2017 RESULTS, INCLUDING STRONG EXECUTION AND STRATEGIC PORTFOLIO ACCOMPLISHMENTS

Delivered quarterly sales volumes of 408 MBoe/d, up 7 percent from the first quarter of 2017 and in the upper half of the Company’s increased guidance range when adjusted for the timing impact of the Marcellus sale closing.
Established a record for second quarter gross sales volumes in Israel at 962 MMcfe/d.
Increased U.S. onshore liquids volumes by 26 MBbl/d from the first quarter of 2017, or 21 percent, nearly half of which was oil.
Achieved record quarterly sales volumes in the Eagle Ford of 69 MBoe/d, up 60 percent from the prior quarter, driven by the development of the highly prolific South Gates Ranch area.
Increased Wells Ranch and East Pony volumes in the DJ Basin to 70 MBoe/d, a quarterly record and up 13 percent from the first quarter of 2017. This drove significant throughput outperformance by Noble Midstream Partners for the second quarter.
Reduced unit operating expenses 14 percent per BOE from the first quarter of 2017.
Completed the inaugural drop down transaction to Noble Midstream Partners for total consideration of $270 million.
Closed the acquisition of Clayton Williams Energy in late April, materially expanding the Company’s Delaware Basin position.
Accelerated value through an exit of the Company’s Marcellus assets.



1




HOUSTON (August 3, 2017) -- Noble Energy, Inc. (NYSE: NBL) (“Noble Energy” or “the Company”) today announced results for the second quarter of 2017, including a net loss attributable to Noble Energy of $1.5 billion , or $3.20 per diluted share, driven by the impact of the Marcellus upstream asset exit. The Company reported adjusted income(1) and adjusted income per share(1) attributable to Noble Energy for the quarter of $24 million , or $0.05 per diluted share, which excludes the impact of certain items typically not considered by analysts in formulating estimates. Adjusted EBITDAX(1) of $658 million offset organic capital expenditures for the quarter of $656 million , which was towards the lower end of the Company's guidance range.

David L. Stover, Noble Energy’s Chairman, President and CEO, commented, “During the second quarter, we again delivered industry-leading well results across our onshore basins, demonstrated continued strong performance at our high-quality offshore operations, and reported volumes and costs that were in-line with or better than our expectations. In addition, the completion of several transformative portfolio actions during the quarter reflect our continued focus on enhancing margins and corporate returns. The quality of our asset base, our superior execution capabilities, and our robust financial strength position us to create differential long-term value.”

Total Company sales volumes for the second quarter of 2017 were 408 thousand barrels of oil equivalent per day (MBoe/d). Adjusting for the early timing of the Marcellus divestiture closing (June 28), which resulted in lower volumes for the quarter on average by 3 MBoe/d, sales volumes were in the upper half of the Company’s increased guidance range. Crude oil and condensate sales volumes were 134 thousand barrels per day (MBbl/d). Natural gas liquids (NGLs) totaled 67 MBbl/d and natural gas contributed 1.2 billion cubic feet per day. U.S. onshore sales volumes averaged 269 MBoe/d and offshore sales volumes were 139 MBoe/d.


(1) A Non-GAAP measure, see attached Reconciliation Schedules
2



Approximately 76 percent of the Company’s organic capital expenditures were allocated to U.S. onshore plays and 22 percent was spent in Israel primarily for the development of Leviathan. The Company also consolidated $46 million of capital funded by Noble Midstream Partners LP (NYSE: NBLX) ("Noble Midstream Partners"), representing third-party customer system development costs in the DJ Basin and spending associated with the build-out of the first central gathering facility in the Delaware Basin.

U.S. onshore crude oil differentials were approximately $2 per barrel less than WTI, NGL pricing represented nearly 40 percent of WTI, and U.S. onshore natural gas pricing averaged equivalent to Henry Hub. Operating expenses for the second quarter, including lease operating expenses (LOE), production taxes, and gathering, transportation and processing expenses, were below expectations at $7.63 per barrel of oil equivalent (BOE), representing a decrease of approximately 14 percent from the first quarter of 2017. A major contributor to the lower operating expenses was the Company’s election to reduce workover activity, primarily on older vertical wells in the DJ Basin. Depreciation, depletion, and amortization was significantly below guidance at $13.56 per BOE, reflecting lower depletion from the Marcellus asset as it was classified as held for sale in April.

Adjustments to the second quarter net loss attributable to Noble Energy include the impact of the Marcellus upstream asset exit as well as closing costs related to the Clayton Williams Energy acquisition. The Company also had unrealized commodity derivative gains, resulting from the value change of existing crude oil and natural gas hedge positions .

The Company exited the quarter with over $4.5 billion in liquidity, including an undrawn $4 billion credit facility. Proceeds received from the Marcellus upstream asset exit and the Noble Midstream Partners drop down transaction were utilized for the cash component of the Clayton Williams Energy acquisition and the elimination of assumed debt from the transaction.

Robust U . S . Onshore Liquids Growth

3



Total sales volumes across the Company’s U.S. onshore assets were 269 MBoe/d (33 percent oil, 23 percent NGL, and 44 percent natural gas), including record quarterly oil and NGL production. U.S onshore oil volumes of 88 MBbl/d and NGL volumes of 61 MBbl/d, were up 16 and 30 percent, respectively, from the first quarter of 2017. The DJ Basin averaged 107 MBoe/d, the Eagle Ford averaged 69 MBoe/d, and the Delaware averaged 23 MBoe/d. Marcellus sales volumes were reported through closing of the sale on June 28, 2017 and averaged 393 million cubic feet of natural gas equivalent per day (MMcfe/d). Other U.S. onshore assets contributed the remaining 4 MBoe/d.

The Company initiated production on 6 operated wells during the second quarter in the Company’s legacy Delaware Basin acreage, including 5 Wolfcamp A wells and 1 Wolfcamp B well. Included in the wells is the Company’s first 10,000 foot lateral well, completed in the Wolfcamp A Upper zone with 3,000 pounds of proppant per lateral foot. Under managed flowback procedures, the well has averaged approximately 1,500 Boe/d over the first 60 days of production and is exhibiting flatter than expected decline. The remaining 4 Wolfcamp A wells, which also utilized 3,000 pounds of proppant per lateral foot, averaged an IP-30 of approximately 330 Boe/d per 1,000 lateral feet, materially above the Company’s 1.2 million barrels of oil equivalent (MMBoe) type curve (normalized to a 7,500 foot lateral). Also included in the wells is the Company’s first operated Wolfcamp A Lower well, which was simultaneously completed with a Wolfcamp A Upper well. The average oil mix of the wells is nearly 75 percent.

The Company also began production on its second operated well within the Wolfcamp B zone. The well was completed using 3 ,000 pounds of proppant per lateral foot and is significantly outperforming expectations after approximately 60 days on production.

The first Delaware central gathering facility, operated by Noble Midstream Partners, began operation at the end of July . In conjunction with the start-up, the Company is commencing production of the three-well Monroe pad with 10,000 foot laterals, including one well each targeting the Wolfcamp A Upper, Wolfcamp A Lower and the 3rd Bone Spring zones.


4



In the DJ Basin, horizontal volumes in the DJ Basin were up 7 percent from the first quarter to 96 MBoe/d, led by continued growth in Wells Ranch and East Pony. Oil as a mix of production in the DJ Basin grew to a record 53 percent. Vertical well production in the quarter of 11 MBoe/d was lower than originally projected and down 6 MBoe/d from the first quarter of 2017, primarily as a result of the Company’s election to defer workover activity and higher line pressure impacts on older vertical wells.

During the second quarter, 33 wells commenced production in the DJ Basin, including 11 in Wells Ranch and 22 in East Pony. In Wells Ranch, the 11 wells had an average lateral length of 10,500 feet and a proppant concentration of 1,800 pounds per lateral foot. The final seven wells of the 13 well Shadow A-26 pad commenced production in the quarter. The per-well production average for the pad is more than 1,100 Boe/d for 100 days, substantially above the Company’s 1.0 MMBoe type curve (9,500 foot lateral length) .

Of the East Pony wells commencing production, 14 were enhanced completions averaging a proppant concentration of 1,900 pounds per lateral foot. Enhanced completions in the East Pony area continue to outperform the 570 thousand barrels of oil equivalent type curve (normalized to a 7,500 foot lateral length) by more than 75 percent . The remaining 8 wells that were turned into production during the quarter were located on federal acreage with an average 900 pounds of proppant per lateral foot. New wells in East Pony are delivering more than 80 percent oil production.

In the Eagle Ford , 14 Lower Eagle Ford wells in South Gates Ranch began production during the second quarter of 2017. This drove average Eagle Ford net production to 69 MBoe/d, representing a 60 percent increase from the first quarter average daily sales volume. South Gates Ranch wells turned online during the quarter are performing at expectations.

The Company maintained an average of eight operated rigs onshore during the second quarter (2 in the DJ, 1.5 in the Eagle Ford, and 4.5 in the Delaware), and as planned, is currently operating seven rigs (2 in the DJ and 5 in the Delaware).

5




Natural Gas Demand Driving Record 2Q Gross Sales Volumes in Israel
The Company averaged 275 MMcfe/d in sales volumes from its Israel assets within the second quarter, up slightly from the first quarter of 2017. Pricing remained stable, with a quarterly realization of $5.34 per thousand cubic feet of natural gas . Gross field sales of 962 MMcfe/d was a record second quarter period and reflected an increase of over 9 percent from the second quarter of 2016.

The Company continued to progress the Leviathan project within budget towards first gas by the end of 2019. Drilling of a Leviathan production well concluded in July. In conjunction with the recent Leviathan sanction, the Company booked initial proved reserves associated with the first phase of development of 550 MMBoe net, representing an increase of over 35 percent to total company reserves at the end of 2016 .

Continued Reliable Performance from Other Global Offshore Assets
Sales volumes in the Gulf of Mexico were in-line with expectations at 27 MBoe/d, with 81 percent oil contribution, reflecting continued strong performance from the Company's Big Bend, Dantzler and Gunflint fields. Noble Energy received approval from the United States Coast Guard for the Neptune facility life extension, the first Gulf of Mexico spar life extension granted in the industry. The Neptune facility hosts production for the Company’s Swordfish field.

Sales volumes for West Africa were 66 MBoe/d (36 percent oil, 6 percent NGL, and 58 percent natural gas), consistent with produced volumes. In April, the Company executed a unitization agreement with the partners of Block D over the Alba Production Sharing Contract in Equatorial Guinea. Noble Energy’s working interest in the Alba field has been modified slightly from 35 percent to 33 percent going forward .

UPDATED GUIDANCE
Total sales volumes for the third quarter and fourth quarter of 2017 are currently expected to be 340 - 350 MBoe/d and 380 - 390 MBoe/d, respectively. Excluding approximately 75 MBoe/d of full year 2017

6



volumes related to the Marcellus and other asset divestments, the Company’s original annual volume guidance was 340 - 350 MBoe/d. When considering the impact of these divestments, the Company is in-line with the midpoint or upper half of its full year 2017 guidance ranges for U.S. onshore oil, total oil and total volumes.

U.S. onshore volumes reflect outperformance from enhanced completions offsetting the impact of reduced vertical production in the DJ Basin. Offshore, Gulf of Mexico and Israel outperformance offsets lower volumes in West Africa. Volumes from West Africa will be significantly impacted in the third quarter as a result of the absence of any Alba field liftings in the period.

For the full year 2017, Noble Energy expects organic capital expenditures to be towards the upper end of the Company’s $2.3 billion to $2.6 billion guided range, due to accelerated spending for both Leviathan and central gathering facilities in the Delaware Basin.

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

(1) A Non-GAAP measure, see attached Reconciliation Schedules

WEBCAST AND CONFERENCE CALL INFORMATION
Noble Energy, Inc. will host a live audio webcast and conference call at 11:00 a.m. Central Time today, August 3, 2017. 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: 888-539-3613
Int’l Toll call: 719-325-2291
Conference ID: 1516342


7



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 spanning three continents. Founded more than 80 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 Repine
(832) 639-7380
Megan.Repine@nblenergy.com

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

Media Contacts
Reba Reid
(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

8



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 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 use certain terms in this news release, such as “type curve”, “MBoe type curve”, or “MMBoe type curve”, which are by their nature 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 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 the 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.




9



Schedule 1
Noble Energy, Inc.
Summary Statement of Operations
(in millions, except per share amounts, unaudited)  
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Revenues
 
 
 
 
 
 
 
Crude Oil and Condensate
$
557

 
$
465

 
$
1,084

 
$
829

Natural Gas Liquids  
108

 
76

 
213

 
130

Natural Gas
352

 
282

 
714

 
569

Income from Equity Method Investees and Other
42

 
24

 
84

 
43

Total Revenues
1,059

 
847

 
2,095

 
1,571

Operating Expenses
 
 
 
 
 
 
 
Lease Operating Expense
124

 
119

 
263

 
281

Production and Ad Valorem Taxes
38

 
40

 
83

 
43

Gathering, Transportation and Processing Expense (1)
121

 
121

 
240

 
232

Marketing Expense
14

 
9

 
33

 
27

Exploration Expense
30

 
89

 
72

 
252

Depreciation, Depletion and Amortization
503

 
622

 
1,031

 
1,239

General and Administrative
103

 
107

 
202

 
198

Loss on Marcellus Shale Upstream Divestiture
2,322

 

 
2,322

 

Other Operating Expense, Net
104

 
2

 
114

 
(17
)
Total Operating Expenses
3,359

 
1,109

 
4,360

 
2,255

Operating Loss
(2,300
)
 
(262
)
 
(2,265
)
 
(684
)
Other (Income) Expense
 
 
 
 
 
 
 
(Gain) Loss on Commodity Derivative Instruments
(57
)
 
151

 
(167
)
 
107

Interest, Net of Amount Capitalized
96

 
78

 
183

 
157

Other Non-Operating (Income) Expense, Net
(5
)
 
7

 
(6
)
 
3

Total Other Expense
34

 
236

 
10

 
267

Loss Before Income Taxes
(2,334
)
 
(498
)
 
(2,275
)
 
(951
)
Income Tax Benefit
(836
)
 
(183
)
 
(824
)
 
(349
)
Net Loss Including Noncontrolling Interests
(1,498
)
 
(315
)
 
(1,451
)
 
(602
)
Less: Net Income Attributable to Noncontrolling Interests (2)
14

 

 
25

 

Net Loss Attributable to Noble Energy
$
(1,512
)
 
$
(315
)
 
$
(1,476
)
 
$
(602
)
 
 
 
 
 
 
 
 
Net Loss Attributable to Noble Energy Per Share of Common Stock
 
 
 
 
 
 
 
Loss Per Share, Basic and Diluted
$
(3.20
)
 
$
(0.73
)
 
$
(3.27
)
 
$
(1.40
)
 
 
 
 
 
 
 
 
Weighted Average Number of Shares Outstanding
 
 
 
 
 
 
 
Basic and Diluted
472

 
430

 
452

 
429

(1) Certain of our processing expense was historically presented as a component of other operating expense, net, in our consolidated statements of operations. Beginning in 2017, we have changed our presentation to reflect processing expense as a component of production expense. These costs are now included within gathering, transportation and processing expense. For the three and six months ended June 30, 2017, these costs totaled $2 million and $5 million respectively. For the three and six months ended June 30, 2016, these costs totaled $6 million and $10 million respectively, and have been reclassified from marketing expense to conform to the current presentation.
(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.

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 August 3, 2017.

10



Schedule 2
Noble Energy, Inc.
Condensed Balance Sheets
(in millions, unaudited)
 
 
June 30, 2017
 
December 31, 2016
ASSETS
 
 
 
Current Assets
 
 
 
Cash and Cash Equivalents
$
540

 
$
1,180

Accounts Receivable, Net
699

 
615

Other Current Assets
338

 
160

Total Current Assets
1,577

 
1,955

Net Property, Plant and Equipment
18,276

 
18,548

Goodwill
1,289

 

Other Noncurrent Assets
432

 
508

Total Assets
$
21,574

 
$
21,011

LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
Current Liabilities
 
 
 
Accounts Payable - Trade
$
1,086

 
$
736

Other Current Liabilities
509

 
742

Total Current Liabilities
1,595

 
1,478

Long-Term Debt
7,133

 
7,011

Deferred Income Taxes
1,469

 
1,819

Other Noncurrent Liabilities
1,279

 
1,103

Total Liabilities
11,476

 
11,411

Total Shareholders' Equity
9,635

 
9,288

Noncontrolling Interests (1)
463

 
312

Total Equity
10,098

 
9,600

Total Liabilities and Equity
$
21,574

 
$
21,011

(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 August 3, 2017.

















11



Schedule 3
Noble Energy, Inc.
Condensed Statement of Cash Flows
(in millions, unaudited)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
 
 
 
 
 
 
 
 
Cash Flows From Operating Activities
 
 
 
 
 
 
 
Net Loss Including Noncontrolling Interests (1)
$
(1,498
)
 
$
(315
)
 
$
(1,451
)
 
$
(602
)
Adjustments to Reconcile Net Loss to Net Cash Provided by Operating Activities
 
 
 
 
 
 
 
Depreciation, Depletion and Amortization
503

 
622

 
1,031

 
1,239

Loss on Marcellus Shale Upstream Divestiture
2,322

 

 
2,322

 

Deferred Income Tax Benefit
(873
)
 
(228
)
 
(873
)
 
(414
)
Dry Hole Cost

 
27

 

 
114

Gain on Extinguishment of Debt

 

 

 
(80
)
(Gain) Loss on Commodity Derivative Instruments
(57
)
 
151

 
(167
)
 
107

Net Cash Received in Settlement of Commodity Derivative Instruments
11

 
144

 
14

 
322

Stock Based Compensation
53

 
20

 
67

 
40

Other Adjustments for Noncash Items Included in Income
27

 
13

 
33

 
95

Net Changes in Working Capital
(147
)
 
(245
)
 
(99
)
 
(381
)
Net Cash Provided by Operating Activities
341

 
189

 
877

 
440

Cash Flows From Investing Activities
 
 
 
 
 
 
 
Additions to Property, Plant and Equipment
(628
)
 
(316
)
 
(1,215
)
 
(812
)
Clayton Williams Energy Acquisition
(616
)
 

 
(616
)
 

Additions to Equity Method Investments
(68
)
 

 
(68
)
 
(6
)
Proceeds from Marcellus Shale Upstream Divestiture
1,028

 

 
1,028

 

Other Acquisitions
(5
)
 

 
(321
)
 

Proceeds from Divestitures and Other
61

 
529

 
101

 
767

Net Cash Used in Investing Activities
(228
)
 
213

 
(1,091
)
 
(51
)
Cash Flows From Financing Activities
 
 
 
 
 
 
 
Dividends Paid, Common Stock
(48
)
 
(45
)
 
(92
)
 
(86
)
Proceeds from Noble Midstream Services Revolving Credit Facility
195

 

 
195

 

Repayment of Noble Midstream Services Revolving Credit Facility
(5
)
 

 
(5
)
 

Issuance of Noble Midstream Partners Common Units, Net of Offering Costs
138

 

 
138

 

Proceeds from Revolving Credit Facility
1,310

 

 
1,310

 

Repayment of Revolving Credit Facility
(1,310
)
 

 
(1,310
)
 

Repayment of Clayton Williams Energy Long-term Debt
(595
)
 

 
(595
)
 

Proceeds from Long-Term Debt, Net

 

 

 
17

Other
(45
)
 
(10
)
 
(67
)
 
(48
)
Net Cash Used in Financing Activities
(360
)
 
(55
)
 
(426
)
 
(117
)
(Decrease) Increase in Cash and Cash Equivalents
(247
)
 
347

 
(640
)
 
272

Cash and Cash Equivalents at Beginning of Period
787

 
953

 
1,180

 
1,028

Cash and Cash Equivalents at End of Period
$
540

 
$
1,300

 
$
540

 
$
1,300

(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 and six months ended June 30, 2017, Net Loss includes Net Income Attributable to Noncontrolling Interests in NBLX.

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 August 3, 2017.

12



Schedule 4
Noble Energy, Inc.
Volume and Price Statistics
(unaudited)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
Sales Volumes
2017
 
2016
 
2017
 
2016
Crude Oil and Condensate (MBbl/d)
 
 
 
 
 
 
 
United States Onshore
88

 
73

 
82

 
75

United States Gulf of Mexico
22

 
23

 
23

 
24

Equatorial Guinea
22

 
27

 
20

 
27

Equity Method Investee - Equatorial Guinea
2

 
1

 
2

 
1

Total
134

 
124

 
127

 
127

Natural Gas Liquids (MBbl/d)
 
 
 
 
 
 
 
United States Onshore
61

 
58

 
54

 
54

United States Gulf of Mexico
2

 
1

 
2

 
2

Equity Method Investee - Equatorial Guinea
4

 
5

 
5

 
4

Total
67

 
64

 
61

 
60

Natural Gas (MMcf/d)
 
 
 
 
 
 
 
United States Onshore
720

 
907

 
713

 
900

United States Gulf of Mexico
16

 
17

 
20

 
17

Israel
272

 
276

 
272

 
271

Equatorial Guinea
231

 
233

 
237

 
214

Total
1,239

 
1,433

 
1,242

 
1,402

Total Sales Volumes (MBoe/d)
 
 
 
 
 
 
 
United States Onshore
269

 
282

 
255

 
280

United States Gulf of Mexico
27

 
27

 
28

 
28

Israel
46

 
46

 
46

 
45

Equatorial Guinea
60

 
66

 
59

 
63

Equity Method Investee - Equatorial Guinea
6

 
6

 
7

 
6

Total Sales Volumes (MBoe/d)
408

 
427

 
395

 
422

 
 
 
 
 
 
 
 
Total Sales Volumes (MBoe)
37,103

 
38,867

 
71,470

 
76,721

 
 
 
 
 
 
 
 
Price Statistics - Realized Prices (1)
 
 
 
 
 
 
 
Crude Oil and Condensate ($/Bbl)
 
 
 
 
 
 
 
United States Onshore
$
45.63

 
$
40.06

 
$
47.13

 
$
35.02

United States Gulf of Mexico
46.34

 
42.51

 
47.96

 
35.86

Equatorial Guinea
49.53

 
44.55

 
51.28

 
39.53

Natural Gas Liquids ($/Bbl)
 
 
 
 
 
 
 
United States Onshore
$
18.77

 
$
14.02

 
$
20.96

 
$
12.66

United States Gulf of Mexico
19.99

 
17.18

 
23.78

 
15.06

Natural Gas ($/Mcf)
 
 
 
 
 
 
 
United States Onshore
$
3.19

 
$
1.75

 
$
3.32

 
$
1.82

United States Gulf of Mexico
3.86

 
1.83

 
3.44

 
2.11

Israel
5.34

 
5.15

 
5.33

 
5.17

Equatorial Guinea
0.27

 
0.27

 
0.27

 
0.27

(1) Average realized prices do not include gains or losses on commodity derivative instruments.

13



Schedule 5
Noble Energy, Inc.
Reconciliation of Net Loss 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 loss 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 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 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, may not be comparable to similar measures of other companies in our industry.
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Net Loss Attributable to Noble Energy (GAAP)
$
(1,512
)
 
$
(315
)
 
$
(1,476
)
 
$
(602
)
Adjustments to Net Loss
 
 
 
 
 
 
 
Loss on Marcellus Shale Upstream Divestiture
2,322

 

 
2,322

 

(Gain) Loss on Commodity Derivative Instruments, Net of Cash Settlements
(46
)
 
295

 
(153
)
 
429

Clayton Williams Energy Acquisition Expenses
90

 

 
94

 

Other Adjustments (1)
11

 
38

 
27

 
15

Total Adjustments Before Tax
2,377

 
333

 
2,290

 
444

Current Income Tax Effect of Adjustments (2)
3

 
(13
)
 
1

 

Deferred Income Tax Effect of Adjustments (2)
(844
)
 
(108
)
 
(814
)
 
(173
)
Adjustments to Net Loss, After Tax
$
1,536

 
$
212

 
$
1,477

 
$
271

Adjusted Income (Loss) Attributable to Noble Energy (Non-GAAP)
$
24

 
$
(103
)
 
$
1

 
$
(331
)
 
 
 
 
 
 
 
 
Net Loss Attributable to Noble Energy Per Share, Basic and Diluted (GAAP)
$
(3.20
)
 
$
(0.73
)
 
$
(3.27
)
 
$
(1.40
)
Loss on Marcellus Shale Upstream Divestiture
4.90

 

 
5.11

 

(Gain) Loss on Commodity Derivative Instruments, Net of Cash Settlements
(0.10
)
 
0.69

 
(0.34
)
 
1.00

Clayton Williams Energy Acquisition Expenses
0.19

 

 
0.21

 

Other Adjustments (1)
0.04

 
0.08

 
0.09

 
0.03

Current Income Tax Effect of Adjustments (2)
0.01

 
(0.03
)
 

 

Deferred Income Tax Effect of Adjustments (2)
(1.79
)
 
(0.25
)
 
(1.80
)
 
(0.40
)
Adjusted Income (Loss) Attributable to Noble Energy Per Share, Diluted (Non-GAAP) (3)
$
0.05

 
$
(0.24
)
 
$

 
$
(0.77
)
 
 
 
 
 
 
 
 
Weighted Average Number of Shares Outstanding, Basic
472

 
430

 
452

 
429

Incremental Dilutive Shares
2

 

 
2

 

Weighted Average Number of Shares Outstanding, Diluted
474

 
430

 
454

 
429

(1) Amounts for the three and six months ended June 30, 2017 primarily relate to a non-cash legal accrual in second quarter 2017 and impairment of certain leases in Gulf of Mexico recorded in first half of 2017. Amounts for the three and six months ended June 30, 2016 primarily relate to the expiration of a license in Eastern Mediterranean and a loss on divestiture, partially offset by an adjustment to the Rosetta purchase price allocation in second quarter 2016, as well as a gain on debt extinguishment recorded in first half of 2016.
(2) 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 and the change in the indefinite reinvestment assertion related to accumulated undistributed earnings of foreign subsidiaries.
(3) In periods where adjusted income attributable to Noble Energy (Non-GAAP) is presented, dilutive earnings per share is computed by using the adjusted income attributable to Noble Energy (Non- GAAP) divided by the weighted average number of shares outstanding, diluted.

14



Schedule 6
Noble Energy, Inc.
Reconciliation of Net Loss Attributable to Noble Energy (GAAP) to Adjusted Income (Loss) Attributable to Noble Energy (Non-GAAP) and 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 loss attributable to Noble Energy (GAAP) or any other measure as reported in accordance with GAAP. Our management believes, and certain investors may find, that Adjusted EBITDAX 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 may be useful for comparison to forecasts prepared by analysts and other third parties. However, our presentation of Adjusted EBITDAX may not be comparable to similar measures of other companies in our industry.
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Net Loss Attributable to Noble Energy (GAAP)
$
(1,512
)
 
$
(315
)
 
$
(1,476
)
 
$
(602
)
Adjustments to Net Loss, After Tax   (1)
1,536

 
212

 
1,477

 
271

Adjusted Income (Loss) Attributable to Noble Energy (Non-GAAP)
24

 
(103
)
 
1

 
(331
)
 
 
 
 
 
 
 
 
Adjustments to Adjusted Income (Loss) Attributable to Noble Energy
 
 
 
 
 
 
 
Depreciation, Depletion, and Amortization
503

 
622

 
1,031

 
1,239

Exploration Expense (2)
30

 
62

 
54

 
225

Interest, Net of Amount Capitalized
96

 
78

 
183

 
157

Current Income Tax Expense (3)
34

 
58

 
48

 
65

Deferred Income Tax Benefit (3)
(29
)
 
(120
)
 
(59
)
 
(241
)
Adjusted EBITDAX (Non-GAAP)
$
658

 
$
597

 
$
1,258

 
$
1,114

(1) See Schedule 5: Reconciliation of Net 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 Loss, After Tax, above .
(3) Represents remaining Income Tax Expense (Benefit) after reversal of Adjustments to Net Loss, After Tax, above .

Capital Expenditures
(in millions, unaudited)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2017
 
2016
 
2017
 
2016
Organic Capital Expenditures, Attributable to Noble Energy (Accrual Based)
$
656


$
262


$
1,272

 
$
638

Acquisition Capital
2,495

 

 
2,818

 

NBLX Funded Capital Expenditures
46

 

 
106

 

Total Reported Capital Expenditures (Accrual Based)
$
3,197

 
$
262

 
$
4,196

 
$
638




15
NBL Second Quarter 2017 Supplement August 2017


 
2NBL 2Q17 KEY HIGHLIGHTS Executing to plan while delivering significant strategic objectives Volumes and Costs In-line or Better than Guidance Continued to Deliver Strong Well Performance Achieved Substantial Drilling Efficiencies Across USO Accomplished Strategic Objectives • Volumes of 408 MBoe/d, in the upper half of guidance after adjusting for Marcellus close timing • Record U.S. onshore oil volumes, including 12 MBbl/d increase over 1Q17 • Established record for second quarter gross sales volumes in Israel of 962 MMcfe/d • Exited the Marcellus upstream and sold Marcellus midstream business • Clayton Williams Energy acquisition expanded top-tier U.S. onshore oil portfolio • Completed the inaugural drop down transaction to NBLX for total consideration of $270 million • Progressed Leviathan within budget and on track for start-up by the end of 2019 • Delaware Basin wells delivering above expectations, exhibiting longer plateau and flatter decline • DJ Basin horizontal volumes up 7% vs. 1Q17 on strong new well performance; record oil mix of 53% • 14 S. Gates Eagle Ford wells with avg. cum. production of 235 MBoe after 60 days (normalized to 7,000 ft) • Reduced drilling costs per lateral foot in 1H17 vs. 2016 by 20% - 30% • Set record individual well drilling time in Delaware Basin • Achieved lowest individual well drilling cost to date in Eagle Ford


 
3NBL 2Q17 ACTUALS VS. GUIDANCE In line and exceeding guidance for majority of items Financial and Operating Metrics 2Q Guidance 2Q Actuals Total Sales Volumes (MBoe/d) Original: 395 - 415 Increased: 405 - 415 408* Oil Sales Volumes (MBbl/d) 132 - 138 134* Natural Gas Liquids (MBbl/d) 67 - 72 67* Natural Gas (MMcf/d) 1,220 - 1,245 1,239* Organic Capital ($MM) 650 - 750 656** Equity Investment Income ($MM) 30 - 40 42 Lease Operating ($/BOE) 3.65 - 3.90 3.34 Gathering, Transportation & Processing ($/BOE) 3.65 - 3.90 3.26 DD&A ($/BOE) 15.00 - 15.90 13.56*** Production Taxes (% Oil, NGL, Gas Revenues) 3.8 - 4.2 3.7 Marketing ($MM) 10 - 20 14 Exploration ($MM) 40 - 60 30 G&A ($MM) 95 - 110 103 Interest, net ($MM) 85 - 95 96 Earnings Reconciliation 2Q ($MM) GAAP Net Loss attributable to NBL (1,512) GAAP Net Loss attributable to NBL Before Tax (2,348) Adjustments to Net Loss, Before Tax 2,377 Adjusted Net Income attributable to NBL, Before Tax 29 Current Tax Expense, Adjusted (34) Deferred Tax Benefit, Adjusted 29 Adjusted Income Attributable to NBL**** (Non-GAAP) 24 Adjusted EBITDAX 2Q ($MM) Adjusted Income Attributable to NBL**** (Non-GAAP) 24 Interest, net 96 Current Tax Expense, Adjusted 34 Deferred Tax Benefit, Adjusted (29) DD&A 503 Exploration 30 Adjusted EBITDAX**** (Non-GAAP) 658 *Early close of Marcellus impacted 2Q17 production by 3 MBoe/d **Excludes acquisition and NBLX funded capital ***Marcellus DD&A included for partial quarter until asset classified as held for sale in April.**** Non-GAAP reconciliation to GAAP measure available in 2Q17 earnings release


 
4NBL U.S. ONSHORE Robust U.S. onshore liquids growth 2Q17 Activity DJ Basin Delaware Eagle Ford Marcellus* Other Total Oil (MBbl/d) 57 15 12 2 2 88 NGL (MBbl/d) 20 4 28 9 .5 61 Gas (MMcf/d) 182 22 177 331 8 720 Total Sales (MBoe/d) 107 23 69 66 4 269 Organic Capital** ($MM) 210 141 113 32 496 Avg. Operated Rigs 2 4.5 1.5 8 Wells Drilled 29 13 11 53 Avg. Lateral Length (ft) 9,220 7,965 6,315 8,310 Wells Completed 30 11 14 55 Wells Brought Online 33 6*** 21 8 68 Avg. Lateral Length (ft) 6,530 5,318 6,665 7,750 6,610 DJ Basin Delaware Basin Marcellus* Eagle Ford 2Q17 Key Highlights • 12 MBbl/d Increase in U.S. Onshore Oil Over 1Q17, up 16% • Record U.S. Onshore Oil and NGL Volumes of 149 MBbl/d • Eagle Ford Production Ramp 60% in 2Q17 vs. 1Q17, with Further Growth Anticipated in 3Q17 • Encouraging Early Results From First Delaware Basin Simultaneous WCA Upper and Lower Completion • Expanded Confidence and Dataset in Enhanced Completions Across Wider Area of DJ Basin and Delaware Basin Acreage • Inaugural Drop Down to NBLX Completed • Currently Operating 7 Rigs (5 Delaware and 2 DJ Basin) * Upstream Marcellus divestiture closed June 28, 2017 ** Excludes NBLX funded capital expenditures *** Excludes 2 CWEI wells brought online prior to transaction close


 
5NBL DELAWARE BASIN Accelerating value in top-tier Southern Delaware position Delaware Basin Activity* 1Q17 2Q17 Total Sales Volume (MBoe/d) 14 23 Organic Capital** ($MM) 100 141 Operated Rigs 3 4.5 Wells Drilled 10 13 Average Lateral Length (ft) 7,600 7,965 Wells Completed 6 11 Wells Brought Online 3 6 Average Lateral Length (ft) 4,760 5,318 118,000 Net acres 4,225 Gross locations 7,800 ft Average lateral Length 2 BBoe Net unrisked resources Successful Integration of CWEI • CWEI transaction closed late April 2017 • 7 MBoe/d average production contribution in 2Q17 First 10,000 Ft Laterals, Multi-Zone Test Commencing Production • 3-well multi-horizon pad targeting the Wolfcamp A Upper, Wolfcamp A Lower and 3rd Bone Spring • Timed with the 1st gathering facility coming online ~10-15 ~20-25 1Q17 2Q17 3Q17 4Q17 Expected Wells Turned to Sales* * Includes CWEI activity as of April 25, 2017 forward. ** Excludes NBLX funded capital expenditures 64% Quarterly Increase Over 1Q17 Volumes • NBL and CWEI results trending above type curve TX NBL Acreage Ward Reeves Pecos


 
6NBL 0 50 100 150 0 30 60 90 120 Days on Production Wolfcamp B and C Well Results* Trigger 40 6H (WCB) Longoria 11 #2H (WCC) WCB 1.1 MMBoe Type Curve WCC 0.9 MMBoe Type Curve DELAWARE BASIN Unlocking value across multiple stacked zones 2Q17 Highlights • 1st Simultaneous Wolfcamp A Upper and Lower Completions Showing Consistent Performance  Additional simultaneous Upper and Lower Wolfcamp A completions test in CWEI acreage planned in 2H17 • 2Q NBL Wolfcamp A Wells Avg. ~330 Boe/d per 1,000 Lateral Feet (4 well avg.)  2 CWEI wells online in 2Q, in-line with type curve • Under Managed Flowback, 1st 10,000 ft. Wolfcamp A Producing ~1,500 Boe/d Over Initial 60 Days with Flatter Decline • Second Operated Wolfcamp B Well Significantly Outperforming Expectations • Wolfcamp C Well on Track to Exceed 1.0 MMBoe Wolfcamp A Acquisition Type Curve  Brought online by CWEI late in 1Q • 2017 Technical Initiatives  Optimizing stage and cluster spacing  Laboratory core work for produced water test Cum. MBoe Cum. MBoe *Reflects Gross 3 Stream. Normalized to 7,500 ft. 0 50 100 150 200 250 0 30 60 90 120 Day on Production Wolfcamp A Well Results* 2017 NBL AVERAGE 2017 CWEI AVERAGE NBL WCA 1.2 MMBoe Type Curve CWEI WCA 1.0 MMBoe Type Curve


 
7NBL Ward NBL AcreageReeves Pecos Monroe Pad  3-well pad with 10,000 ft laterals  3rd Bone Spring, Wolfcamp A Upper and Wolfcamp A Lower  Commencing production Wolfcamp C- Longoria 11 2H  First slickwater Wolfcamp C Wolfcamp A- Man O War 26 Unit C 8H & Man O War 26 1HA  1st simultaneous WCA Upper and WCA Lower  Consistent performance across both zones Calamity Jane Spacing Pilot  7-well pad with 7,500 ft laterals - 3rd Bone Spring: 2 - Wolfcamp A Upper: 3 - Wolfcamp A Lower: 2  Online end of 2017 DELAWARE BASIN Strong 2Q17 results across top-tier quality acreage position Wolfcamp A- City of Pecos 2HB & Sheriff Woody 5H  2Q legacy NBL wells Wolfcamp A- Collier APA 8 & Trust State 242 1H  2Q CWEI wells Wolfcamp A- Will Rogers 1H  First 10,000 ft. lateral Wolfcamp B- Trigger 40 6H  2nd Wolfcamp B


 
8NBL DELAWARE BASIN Midstream integration a competitive advantage NBLX Supporting Growth Objectives • Expanding Capacity and Accelerating Build-Out of Central Gathering Facilities • 1st Gathering Facility (CGF) Online in Late July  2nd facility online YE2017, planning for two in 2018 • 3-Well Pad Targeting Upper and Lower WCA and 3rd Bone Spring with 10,000 ft. Laterals Tying Into 1st Facility • Initial Facility Connected to NBLX and Plains All American 50/50 JV Advantage Pipeline, Accessing Multiple Crude Oil Outlets • Water Strategy Designed to Optimize LOE  NBL owned/operated frac ponds  Operated and 3rd party disposal options  Recycling incorporated into facility design Pecos Ward Reeves NBL Acreage 2017 CGFs Advantage Pipeline Daily Capacity Current 1H18 Oil (MBl/d) 10 90 Gas (MMcf/d) 20 160 Produced Water (MBw/d) 15 210 First 4 CGFs Materially Expand Capacity Billy Miner – First CGF Facility 1H18 CGFs


 
9NBL DJ BASIN Value optimization continues with focus on oil rich areas and enhanced completions CO 352,000 Net acres 3,220 Gross locations 8,400 ft Average lateral Length 2 BBoe Net unrisked resources DJ Basin Activity 1Q17 2Q17 Total Sales Volume (MBoe/d) 107 107 Organic Capital* ($MM) 205 210 Operated Rigs 2 2 Wells Drilled 27 29 Average Lateral Length (ft) 8,840 9,220 Wells Completed 36 30 Wells Brought Online 14 33 Average Lateral Length (ft) 9,970 6,530 Strong Enhanced Completions Drive 7% Horizontal Volume Increase • New well wedge outperforming expectations • Vertical volumes of 11 MBoe/d impacted by reduced workover activity and higher line pressures outside of Wells Ranch and East Pony Leading Edge Completion Designs • Continuation of 1,800 lb/ft standard slickwater design • Optimizing stage and cluster spacing Activity in Low GOR Areas Increasing Oil Percentage • Combined Wells Ranch and East Pony volumes up 13% from 1Q17 to 70 MBoe/d 46% 49% 50% 52% 53% 2Q16 3Q16 4Q16 1Q17 2Q17 Oil Mix Continues to Increase * Excludes NBLX funded capital expenditures Weld Wells Ranch East Pony NBL Acreage


 
10NBL 40 50 60 70 2Q16 3Q16 4Q16 1Q17 2Q17 Wells Ranch and East Pony Volumes 0 20 40 60 80 100 120 1Q17 2Q17 3Q17E 4Q17E DJ Basin Production Volumes 2017 Wedge Horizontal Base Vertical Base DJ BASIN 2017 horizontal volume outlook exceeds expectations Affirmed 2017 Volume Outlook • 2017 Horizontal Outlook Raised with Fewer Wells on Strong New Well Performance  4Q17 horizontal volumes anticipated up ~8% YoY • Robust New Horizontal Wedge Performance Supports NBLX’s Strong Outlook • Record Wells Ranch and East Pony Combined Volumes in 2Q • 2Q17 Total Basin Liquids Volumes Up 6%, Natural Gas Down 11% from 1Q17 • NBL Vertical Production Expected to Continue to Decline Due Primarily to Economic Decisions  Deferred workover activity  No material cash flow impact as verticals have higher gas mix (65-75%) and significantly higher LOE MBoe/d MBoe/d


 
11NBL 0 50 100 150 200 250 0 30 60 90 120 150 Days on Production 2017 Wells Ranch Performance* 2017 Well Ranch (21 Wells w/ avg 1,900 lb/ft) Wells Ranch 1.0 MMBoe Type Curve (1,400 lb/ft) 0 20 40 60 80 100 120 140 0 30 60 90 Days on Production 2017 East Pony Performance* 2017 East Pony Wells (26 wells w/ avg 1,500 lb/ft) East Pony 570 MBoe Type Curve (1,400 lb/ft) DJ BASIN Enhanced completions continue to highlight value-focused capital program 2Q17 Highlights • 11 Wells Ranch and 22 East Pony Wells Commenced Production in 2Q • Shadow Pad (13 wells in Wells Ranch) Tested Standard 1,800 lbs/ft Proppant  Avg. 10,500 ft lateral and over 1,100 Boe/d per well for more than 100 days • 3 Additional Pads Utilizing 1,800 lbs/ft in Wells Ranch Online Before YE17 • Continued Strong Performance at East Pony with Enhanced Completions  Balance of 2017 activity focused on federal leases with lower proppant concentration • Utilizing Advanced Analytics to Optimize Completions  Integrating complex technical reservoir modeling with actual results  Model expected future outcomes:  Drives real-time enhanced completions variations given subsurface changes across acreage position Cum. MBoe *Reflects Gross 3 Stream Wells Ranch Normalized to 9,500 ft., East Pony Normalized to 7,500 ft. Cum. MBoe


 
12NBL 1,500 ft. NBL mapping coordinates, inspection and integrity-testing radius exceeded 1,000 ft. requirement 7,500 flowline integrity tests field wide YTD 30 GPS surveyors added to expedite flowline mapping process 45,000 man hours on timely execution DJ BASIN COGCC Notice to Operators – ensuring safety of people, protection of the environment and integrity of operations • Assembled a multi-disciplinary team to implement the Notice to Operators (NTO) issued by the Colorado Oil and Gas Conservation Commission (COGCC) on May 2, 2017  Inspections and GPS of off-pad flowline locations within 1,500 ft. complete May 30  Flowline integrity testing and permanent abandonment of inactive off-pad lines complete June 30 Noble Actions in Colorado


 
13NBL 0 100 200 300 400 500 600 0 20 40 60 80 100 Days on Production South Gates Cumulative Production 3,500 MBoe Type Curve 2017 Wells EAGLE FORD SHALE Achieving targeted value and production ramp on strong execution TX Eagle Ford Activity 1Q17 2Q17 Total Sales Volume (MBoe/d) 43 69 Organic Capital ($MM) 166 113 Operated Rigs 2 1.5 Wells Drilled 13 11 Average Lateral Length (ft) 6,940 6,315 Wells Completed 17 14 Wells Brought Online 6 21 Average Lateral Length (ft) 5,740 6,665 33,000 Net acres 360 Gross locations 7,600 ft Average lateral Length 460 MMBoe Net unrisked resources Activity Focused in Highly-prolific South Gates Ranch Row 4 • Wells demonstrating flatter declines versus type curve • 18 South Gates wells to commence production in 2H17 Record Quarterly Sales Volume of 69 MBoe/d $50 Million Divestiture of Non-core Klotzman Acreage Accelerates Value • 60% increase over 1Q17 • 1,900 net acres, fully developed • ~500 net Boe/d NBL Acreage Dimmit Webb Cum. MBoe Reflects Gross 3 Stream, Normalized to 7,000 Gates Ranch L&E Briscoe Ranch


 
14NBL 0 25 50 75 100 2017E 2018E 2019E 2020E IDR Distributions LP Distributions $MM (1) Includes distributions, IPO and drop down proceeds. Invested capital includes proportionate contribution through IPO and drop down of additional interests. (2) Represents NBL’s 50.1% ownership of NBLX LP unit at market value as of 7/31/17 closing price. (3) Estimates average 2018-2020 EBITDA of retained assets and development company interest. Applies potential future drop down multiple of 7.5x and 10x to EBITDA. EBITDA is a Non-GAAP metric that cannot be easily reconciled to GAAP metric at this asset level. See appendix for definition of this non-GAAP measure. (4) Estimates 100% NBL ownership of NBLX GP IDR average cash flows 2018-2020 at 25x to 35x multiple. (5) NBL owns 100% of the GP Holdings of NBLX. Assumes 20% NBLX distribution growth and units outstanding remain flat. Substantial Growth in Cash Flow Distributions(5) to NBL $556 MM received to date IPO proceeds, distributions and drop down proceeds $817 MM NBL ownership of LP units(2) > $1.5 B combined retained EBITDA(3) and GP value(4) ~2.4x Payout on NBL invested capital contributed to NBLX(1) MATERIAL EMBEDDED MIDSTREAM VALUE NBLX offers significant operating and financial efficiencies • First Initial Drop Down Transaction Valued at $270 MM, Generated $245 MM Cash to NBL; Attractive Future Drop Down Potential Remains  Anticipate significant growth in Delaware and DJ Basin throughput and volumes  Substantial existing opportunities with sponsor retained East Pony gas gathering and processing Key Highlights


 
15NBL EASTERN MEDITERRANEAN Fueling over 60% of Israel power generation and growing Israel 1Q17 2Q17 Net Gas Sales (MMcfe/d) 274 275 Gross Gas Sales (MMcfe/d) 956 962 Organic Capital ($MM) 115 143 2Q17 Key Highlights • Record Second Quarter Gross Sales Volumes 962 MMcfe/d  Achieved several daily records in June and July • Resilient 2Q17 Price Realizations of $5.34/Mcf • Continued Exceptional Reliability with 99.9% Uptime Since Start-up • Tamar 8 Development Well Brought Online in April, Flowed at ~270 MMcf/d  Resource implications higher than 10 Tcfe gross recoverable • Booked Initial Leviathan Proved Reserves of 550 MMBoe, Net 500 600 700 800 900 1,000 1,100 1Q 2Q 3Q 4Q 2014 2015 2016 2017 MMcfe/d 1.1 Bcfe/d Gross Peak Capacity Historical Tamar Gross Sales Volumes AOT 47% WI Tamar 32.5% WI Tamar SW 32.5% WI Tel Aviv Ashdod Israel Egypt Cyprus 35% WI Leviathan 39.7% WI Dor Discovery Existing Pipeline Planned Pipeline Sanctioned NBL Interests Producing


 
16NBL LEVIATHAN MAJOR PROJECT Progressing towards first gas sales by end of 2019 15% complete with Phase I development 100% of building permits submitted Drilled L5 well to total depth of 17,200 ft 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 Drilling, Manufacturing, and Onshore Construction Underway


 
17NBL OTHER GLOBAL OFFSHORE Exceptional operational and safety performance 2Q17 Key Highlights • Strong Well Performance at Big Bend, Dantzler and Gunflint Fields in the Gulf of Mexico Led to Average Sales Volumes of 27 MBoe/d  81% oil contribution • Neptune Spar Life Extension Granted Through YE2019 by U.S. Coast Guard  First GOM spar extension in the industry • Maintained 99% Uptime at Aseng and Alen in West Africa and at Neptune in the Gulf of Mexico  Operatorship at Gunflint drove uptime to 87% up from 73% in 1Q17 • Executed Unitization Agreement Over the Alba Field with Partners of Block D, Reducing NBL Working Interest from 35% to 33%  Zero liftings at Alba field in 3Q17 (10 MBoe/d impact) Gulf of Mexico Equatorial Guinea 1Q17 2Q17 1Q17 2Q17 Oil (MBbl/d) 24 22 18 22 Equity Method (MBbl/d) 2 2 NGL (MBbl/d) 2 2 Equity Method (MBbl/d) 6 4 Gas (MMcf/d) 23 16 244 231 Total Sales (MBoe/d) 30 27 66* 66* Organic Capital ($MM) 9 0 1 16 * Produced volumes differ from sales in Equatorial Guinea due to the timing of liftings. Produced volumes were 70 MBoe/d in 1Q17 and 66 MBoe/d in 2Q17.


 
18NBL SURINAME EXPLORATION PROSPECT Testing high potential prospect in late 2017 Guyana Suriname Block 54 Araku Oil Prospect in Cretaceous Rock • Significant Recent Discoveries Offshore Guyana Prove Working Hydrocarbon System  Onshore Suriname Tambaredjo field producing oil • Block 54 Offshore Suriname  NBL 20% WI, non op.  Proprietary 3D survey completed  Multiple play types • Araku Prospect Targeted for 4Q17  500+ MMBoe gross potential  3,200 ft water depth  ~8,000 ft target depth  ~$10 MM net well cost  Primary risk: hydrocarbon phase Tambaredjo Liza & Payara Oil Discovery NBL Interests Oil Prospect


 
19NBL 0 75 150 225 300 375 450 Original FY17E Divested Original FY17E Excluding Divested Updated 3Q17E Updated 4Q17E (~75) UPDATED 2017 GUIDANCE U.S. onshore oil, total oil and total company full year volumes at midpoint or upper half of original guidance* * Pro-forma for divestments ** Excludes NBLX funded capital expenditures • FY17 Sales Volumes on Track with Original Guidance After Adjusting for Marcellus and Other Non-Core Divestitures  Original assumed 72 MBoe/d in 3Q and 80 MBoe/d in 4Q for Marcellus (82% gas, 14% NGL, 4% oil) • 25 - 30 MBbl/d Increase in Oil Volume 4Q17 vs. 3Q17 Driven By: • Resumption of Alba field liftings • ~115 2H17 U.S. onshore wells online • Marcellus Divestment Drives Margin Expansion  U.S. Onshore oil mix grows to over 40% from ~30%  Lowers FY17 unit operating expenses • Organic Capital Expenditures** Expected at the Upper End of $2.3 B to $2.6 B Guidance for FY17  Accelerated midstream and Leviathan spend  75% allocated to U.S. Onshore, 20% to EMED Total Company Sales Volume GuidanceKey Highlights MBoe/d 415-425 340-350 380-390 340-350 25 75 125 1Q 2Q 3QE 4QE 2017 USO Oil Trajectory* MBbl/d


 
20NBL Third quarter and fourth quarter guidance SALES VOLUME GUIDANCE 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 Third Quarter 2017 United States Onshore 86 91 58 61 390 405 209 219 United States Gulf of Mexico 18 20 1 2 10 20 21 25 Israel - - - - 285 305 47 50 Equatorial Guinea 12 14 - - 215 235 48 53 Equatorial Guinea - Equity method investment 2 3 6 6 - - 8 9 Total Company 120 126 65 70 910 950 340 350 Fourth Quarter 2017 United States Onshore 102 108 68 71 465 480 248 258 United States Gulf of Mexico 20 23 1 2 15 25 24 28 Israel - - - - 235 265 40 43 Equatorial Guinea 20 23 - - 210 235 56 61 Equatorial Guinea - Equity method investment 1 2 6 6 - - 7 8 Total Company 147 152 75 80 945 985 380 390


 
21NBL * Excludes NBLX funded capital expenditures Capital & Cost Metrics 3Q 2017 4Q 2017 Low High Low High Capital Expenditures* ($MM) Total Company Organic Capital 625 725 600 700 Cost Metrics Lease Operating Expense ($/BOE) 4.50 4.75 4.25 4.50 Gathering, Transportation & Processing ($/BOE) 3.00 3.25 3.00 3.25 Production Taxes (% Oil, Gas, NGL Revenues) 4.3 4.7 4.3 4.7 Marketing ($MM) 10 20 10 20 DD&A ($/BOE) 15.00 16.00 15.00 16.00 Exploration ($MM) 30 50 40 60 G&A ($MM) 95 110 95 110 Interest, net ($MM) 85 95 85 95 Other Items Guidance Equity Investment Income 30 40 30 40 Average outstanding shares – diluted 480 490 480 490 CAPITAL AND COST GUIDANCE Third quarter and fourth quarter guidance


 
22NBL 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 use certain terms in this presentation, such as “net unrisked resources”, “type curve”, “MMBoe type curve”, or “MMBoe gross potential” which are by their nature 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 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 the Noble Energy’s respective earnings release for reconciliations of the differences between any historical non-GAAP measures used in this presentation and the most directly comparable GAAP financial measures. This presentation also contains a forward-looking non-GAAP financial measure, EBITDA (earnings before interest, taxes, depreciation and amortization). Due to the forward- looking nature of the aforementioned non-GAAP financial measure, management cannot reliably or reasonably predict certain of the necessary components of the most directly comparable forward-looking GAAP measures at this asset level. Accordingly, we are unable to present a quantitative reconciliation of such forward-looking non-GAAP financial measure to its most directly comparable forward-looking GAAP financial measure. Amounts excluded from this non-GAAP measure in future periods could be significant. Management believes the aforementioned non-GAAP financial measure is a good tools for internal use and the investment community in evaluating Noble Energy’s overall financial performance. This non-GAAP measure is broadly used to value and compare companies in the crude oil and natural gas industry.