Results Driven. Manufacturing Focused.

Corporate
Presentation
February 2015

www.sanchezenergycorp.com

Legal Disclaimers
Forward Looking Statements This presentation contains, and our officers and representatives may from time to time make, forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. All statements, other than statements of historical facts, included in this presentation that address activities, events, conditions or developments that Sanchez Energy expects, estimates, believes or anticipates will or may
occur or exist in the future are forward-looking statements. These statements are based on certain assumptions made by the company based on managements experience, perception of historical trends and technical analyses, current
conditions, anticipated future developments and other factors believed to be appropriate and reasonable by management. When used in this presentation, words such as will, potential, believe, estimate, intend, expect, may,
should, anticipate, could, plan, predict, project, profile, model, strategy, future or their negatives or the statements that include these words, are intended to identify forward-looking statements, although not all forwardlooking statements contain such identifying words. In particular, statements, express or implied, concerning Sanchez Energys future operating results and returns or Sanchez Energys ability to replace or increase reserves, increase production,
generate income or cash flows are forward-looking statements. Forward-looking statements are not guarantees of performance. Although Sanchez Energy believes that the expectations reflected in its forward-looking statements are
reasonable and are based on reasonable assumptions, no assurance can be given that these assumptions are accurate or that any of these expectations will be achieved (in full or at all) or will prove to have been correct. Important factors that
could cause Sanchez Energys actual results to differ materially from the expectations reflected in its forward-looking statements include, among others:
Sanchez Energys ability to successfully execute its business and financial strategies;
Sanchez Energys ability to replace the reserves it produces through drilling and property acquisitions;
the realized benefits of Sanchez Energys various acquisitions including Sanchez Energys Catarina acquisition referred to herein and the liabilities assumed in connection with these acquisitions;
the extent to which Sanchez Energys drilling plans are successful in economically developing its acreage in, and to produce reserves and achieve anticipated production levels from, its existing and future projects;
the accuracy of reserve estimates, which by their nature involve the exercise of professional judgment and may therefore be imprecise;
the extent to which Sanchez Energy can optimize reserve recovery and economically develop its plays utilizing horizontal and vertical drilling, advanced completion technologies and hydraulic fracturing;
Sanchez Energys ability to successfully execute its hedging strategy and the resulting realized prices therefrom;
competition in the oil and gas exploration and production industry for employees and other personnel, equipment, materials and services and, related thereto, the availability and cost of employees and other personnel, equipment,
materials and services;
Sanchez Energys ability to access the credit and capital markets to obtain financing on terms it deems acceptable, if at all, and to otherwise satisfy its capital expenditure requirements;
the availability, proximity and capacity of, and costs associated with, gathering, processing, compression and transportation facilities;
the timing and extent of changes in prices for, and demand for, crude oil and condensate, natural gas liquids, natural gas and related commodities;
Sanchez Energys ability to compete with other companies in the oil and natural gas industry;
the impact of, and changes in, government policies, laws and regulations, including tax laws and regulations, environmental laws and regulations relating to air emissions, waste disposal, hydraulic fracturing and access to and use of water,
laws and regulations imposing conditions and restrictions on drilling and completion operations and laws and regulations with respect to derivatives and hedging activities;
developments in oil-producing and natural-gas producing countries;

Sanchez Energys ability to effectively integrate acquired crude oil and natural gas properties into its operations, fully identify existing and potential problems with respect to such properties and accurately estimate reserves, production and
costs with respect to such properties;
unexpected results of litigation filed against Sanchez Energy;
the extent to which Sanchez Energys crude oil and natural gas properties operated by others are operated successfully and economically;
the use of competing energy sources and the development of alternative energy sources;
the extent to which Sanchez Energy incurs uninsured losses and liabilities or losses and liabilities in excess of its insurance coverage; and
the other factors described under ITEM 1A, Risk Factors, in Sanchez Energys Annual Report on Form 10-K for the fiscal year ended December 31 and any updates to those factors set forth in its subsequent Quarterly Reports on Form 10Q or Current Reports on Form 8-K.

In light of these risks, uncertainties and assumptions, the events anticipated by Sanchez Energys forward-looking statements may not occur, and, if any of such events do, Sanchez Energy may not have correctly anticipated the timing of their
occurrence or the extent of their impact on its actual results. Accordingly, you should not place any undue reliance on any of Sanchez Energys forward-looking statements. Any forward-looking statement speaks only as of the date on which
such statement is made and Sanchez Energy undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.
Oil and Gas Reserves The Securities and Exchange Commission (SEC) requires oil and gas companies, in their filings with the SEC, to disclose proved oil and gas reserves (i.e., quantities of oil and gas that are estimated with reasonable
certainty to be economically producible) and permits oil and gas companies to disclose probable reserves (i.e., quantities of oil and gas that are as likely as not to be recovered) and possible reserves (i.e., additional quantities of oil and gas
that might be recovered, but with a lower probability than probable reserves). We may use certain terms in this presentation, such as resource potential that the SECs guidelines strictly prohibit us from including in filings with the SEC. The
calculation of resource potential, and any other estimates of reserves and resources that are not proved, probable or possible reserves are not necessarily calculated in accordance with SEC guidelines. Investors are urged to consider closely
the disclosure in Sanchez Energys Annual Report on Form 10-K for the fiscal year ended December 31.
Non-GAAP Measures Included in this presentation are certain non-GAAP financial measures as defined under Securities and Exchange Commission Regulation G. Investors are urged to consider closely the disclosure in Sanchez Energys Annual
Report on Form 10-K for the fiscal year ended December 31. Quarterly Reports on Form 10-Q and Current Reports on Form 8-K and the reconciliation to GAAP measures provided in this presentation.

2015 Sanchez Energy Corporation

Sanchez Energy Overview

Market Cap (1)
~$1,000 MM
(1)
Enterprise Value ~$2,150 MM

Positioned to thrive in a period of volatile

commodity prices

~226,000 acres
135 MMBoe
~43,000 Boe/d

Balanced reserve and production

weighting between liquids and natural gas
74% of reserves are liquids

Eagle Ford is Flagship Asset

Net Acreage:
1P Reserves:
Current Production:

Managing activity to maintain liquidity and

financial flexibility

Eagle Ford Shale

~3,300+ net drilling locations

Tuscaloosa Marine Shale Upside

Tuscaloosa Marine Shale

(TMS)
Net Acreage: ~69,000 acres

Strong Liquidity

1.
2.

$774 million with option to further enhance

liquidity to over $1.1 billion at 4Q14 (2)

Based on a closing stock price of $12.48 as of 2/2/15 and includes convertible preferred stock at book value (~$269 million)
$476 million cash balance as of 12/31/14 plus an elected commitment of $300 million. SN has the option to further enhance its liquidity if needed by electing the full $650 million borrowing base

2015 Sanchez Energy Corporation

Managing Through the Bottom of the Cycle

Eagle Ford Focus

Reduce Capital
Budget
Optimizing
Liquidity, Leverage,
and Production
Growth

2015 capital budget of $600 650 million will be at $400-450 million annualized run rate by third quarter

Capital budget will maintain 40,000 44,000 Boe/d of production

4Q14 liquidity of $774 million with option to further enhance liquidity to over $1.1 billion
3Q14 net debt to LTM EBITDA of 1.8x

Redoubled efforts on driving costs lower

Main focus on developing Catarina and Palmetto areas

Striking the right balance among liquidity, leverage, and growth

Focus on Efficient
Operations

High grading drilling program, reducing costs, and realizing higher well performance than initial estimates

Reduced initial 2015 capital budget by over 50%

Protect Cash Flows

with Hedges

Focused on high-quality, low-cost oil and condensate resource play

Successfully integrated the Catarina acquisition using SNs manufacturing process strategy
Increasing drilling efficiencies, optimizing completions, and realizing unit cost reductions from the service sector
Orderly rig reduction has already started

Ongoing hedging strategy to minimize price volatility and protect future cash flow

$125 million market to market value of hedges as 12/31/14

2015 Sanchez Energy Corporation

Transformational Growth
At IPO
(12/31/11)

Today
(12/31/14)

609 Boe/d

71x

~43,000 Boe/d

Proved Reserves

6.7 MMBoe
14% PD

20x

135 MMBoe
48% PD

PV-10

$152 million

14x

$2,082 million (1)

LTM Revenue

$15 million

59x

$885 million (2)

LTM Adj. EBITDA

$7 million

91x

$639 million (2)

92,000 Eagle Ford

2.5x

Production

Acreage (3)

Entered new basin

226,000 Eagle Ford

69,000 TMS

5
1.
2.
3.

Based on SNs internally estimated proved reserves at 9/30/14

As of 9/30/14. LTM Revenue and Adj. EBITDA are pro forma for 12 months of ownership of Catarina and Wycross
2.5x growth figure represents increase in Eagle Ford Shale acreage

2015 Sanchez Energy Corporation

Delivering Strong Results

Production (Boe/d)

Reserves by Product Mix (12/31/14)

150
125

PD

135

PUD

50,000

100

52%

MMBoe

30,000

75

59

50
25
0

40,000

58%

21

7
86%

82%

12/31/11

12/31/12

30
%

20,000

48%

10,000
0

42%
12/31/13

Reserves by Product Mix (12/31/14)

1Q

2Q

3Q

4Q

1Q

2Q

2012

12/31/14

3Q

4Q

1Q

2Q

2013

3Q

4Q

2014

Revenue and Adjusted EBITDA ($MM)

$250

Revenue

Adj. EBITDA

$200

NGL 26%
$150

Oil 48%
$100

Gas 26%
$50

135 MMBoe (48% PD)

2015 Sanchez Energy Corporation

$0
1Q

2Q

3Q

2012

4Q

1Q

2Q

3Q

2013

4Q

1Q

2Q

2014

3Q

Revised 2015 Capital Plan: Focus On Liquidity

SN has reduced its 2015 capital plan to $600 - $650 million from $1.1 - $1.2 billion in order to preserve liquidity and financial
flexibility
Focus will be on high rate of return projects while maximizing future potential
Land position mostly held by production, preserving optionality
2015 drilling plan based on 4 gross (3.5 net) rigs to focus on Catarina and Palmetto in the Eagle Ford and .25 gross and net rigs
in the TMS
Excluding carryover capital from 2014, annualized run-rate of $400 - $450 million based on 3.5 gross (3 net) rigs
focused on Catarina and Palmetto in the Eagle Ford
A 2016 capital plan reflecting this annualized run-rate will allow SN to maintain its production levels over 2015
Capital plan to be fully funded from cash and operating cash flows with a significant cash balance remaining at year-end 2015
SNs revolving credit facility ($650 million borrowing base with an elected commitment of $300 million) is expected to
remain undrawn (1)
2015 Capital Plan ($MM)
Net Wells
Project Area
Spud
Catarina
58
Palmetto
11
Cotulla / Wycross
3
Marquis
1
TMS
2
Total D&C Capital Plan
75
Midstream, Leasing, and Other
Total Capital Plan

1.

Assumes average oil prices of $60 / Bbl and natural gas prices of $3.75 / MMBtu

2015 Sanchez Energy Corporation

Net Wells
Completed
65
11
7
3
2
88

Capex
$400 - $410
80
85
30
40
15
20
35
45
$560 - $600
40
50
$600 - $650

% of
% of
Operating
D&C
Capital Plan Capital Plan
65%
70%
13%
14%
6%
6%
3%
3%
6%
7%
93%
100%
7%
100%

Full Year 2015 & 1Q15 Guidance

Expected 2015 production to range between 40,000 and 44,000 Boe/d, an increase of ~40% over 2014 production at the
mid-point of guidance, with expected 1Q15 production to also range between 40,000 and 44,000 Boe/d
Subsequent quarterly production will fluctuate due to the effects of pad drilling (typical pad size in 2015 will vary
between 5 and 10 wells per pad)
Guidance
Metrics
Production Guidance (BOE/D)
Period Average

1Q15

2015

40,000 - 44,000

40,000 - 44,000

Production Mix
% Oil / NGLs / Gas

46% / 27% / 27%

42% / 29% / 29%

$9.00 - $10.00
$2.00 - $3.00
$3.00 - $3.50
$8.40 - $9.25

$9.00 - $10.00
$2.00 - $3.00
$3.00 - $3.50
$8.30 - $9.10

Operating Cost & Expense Guidance ($/BOE)

Oil & Natural Gas Production Expenses
Production & Ad Valorem Taxes
Cash G&A
Preferred Stock Dividends & Interest Expense
Effective Corporate Tax Rate
~35% (100% Deferred)

2015 Sanchez Energy Corporation

Operations

A Manufacturing Transformation

2014 Sanchez Energy Corporation

Eagle Ford Shale Position

SN Position Summary
Net Acres

~226,000

Current Production (Boe/d)

~43,000

Operated Rigs
Non-Operated Rigs
Gross Producing Wells

490

Hausser

Wycross
Alexander
Ranch

10

2015 Sanchez Energy Corporation

Catarina

Cotulla
Wycross
Cotulla
La Salle

Palmetto

Marquis

Stacked Lateral Potential

Upper
Eagle Ford

Lower Eagle
Ford Target 1

Lower Eagle
Ford Target 2

Buda
11
Development

2015 Sanchez Energy Corporation

Appraisal

Low Cost Operator With Sustained Cost Reductions

Total Cash Operating Cost Including Interest & Preferred Dividends ($/Boe)
Interest & Preferred Dividends

$45.06
$4.78
$9.37

2011

LOE

Cash G&A

$41.46
$4.72
$4.53
$7.26

$30.91

Taxes

$24.95

2012

$31.40

$30.83

$27.25

$10.99

$9.72

$4.47

$6.15

$9.21

$4.21

$9.41

$7.48

$6.73

$5.55

$6.47

2013 (1)

1Q14

2Q14 (1)

$9.09

$24.51
$8.41
$3.07
$9.68
$3.35
3Q14 (1)

12
1.

2013, 2Q14, and 3Q14 cash G&A per Boe excludes $1.07/Boe, $0.48/Boe, and $0.26/Boe in non-recurring acquisition expenses, respectively.

2015 Sanchez Energy Corporation

Catarina Overview

Western Catarina (~43,000 net acres)

Eastern
Catarina

~300 Lower Eagle Ford drilling locations

~300 Upper Eagle Ford drilling locations

Partially developed; excellent offset operator results

Increasing Upper Eagle Ford/Lower Eagle Ford
stacked pay opportunity
~400 Potential Lower Eagle Ford drilling locations
with additional upside locations in the Upper Eagle
Ford

Similar characteristics to Alexander Ranch but

significantly larger

Largely underexplored; excellent Lower Eagle Ford

core & log rock quality in the Lower Eagle Ford

Central Catarina (~26,000 net acres)

1.

~600 Potential drilling locations

Western
Catarina

Central
Catarina

Eastern Catarina (~37,000 net acres)

PUD Locations only in Western Catarina

~350 Potential Upper Eagle Ford drilling locations

Additional potential locations in the Lower Eagle Ford

based on results of future appraisal evaluation

Exploration area; full 3D seismic coverage; inversion

processing in progress

Well status as of 2/2/15

2015 Sanchez Energy Corporation

Acreage, Inventory & Operational Update

Total Net Acres
Average Working Interest
Average Net Revenue Interest
Planned Well Spacing (Acres)
Net Identified Drilling Locations
Gross Wells On Production (1)
Awaiting / Undergoing Completions (1)

~106,000
100%
75%
75 100
1,250 - 1,650
195
24

LEF Well Economics

EURs (MBoe)
D&C Costs ($MM)
F&D Cost ($ / Boe)
IRR @ $60 / Bbl & $3.75 / Mcf

600 700
$5.0
$7.14 $8.33
35%+

13

Driving Cost Reductions in Catarina

Operational Efficiencies Realized

Drilling durations (spud to TD) reduced from 15

days to a 9 day average on the last 3 pads drilled
Completion operations have increased efficiency
~15% from first 2 pads stimulated compared to
the most recent 3 pads
Previous Operator

$10.0
$9.0
$8.0
$7.0
$6.0
$5.0
$4.0
$3.0
$2.0
$1.0
$0.0

$MM

Driving Further Competitive Advantage

$8.8

Initial Well Costs

$7.4

Optimized fluids & wellbore design

Direct sourcing of chemicals and proppant

Demand planning and staggered dedication of

services

Process & Efficiencies Driving

Further Reductions

Current Well Costs

$5.0

14

2015 Sanchez Energy Corporation

Western Catarina Well Results

Initial Upper Eagle Ford wells in Catarina have continued to exhibit strong rates and have sustained rates
above the Lower Eagle Ford Type Curve
First four Lower Eagle Ford wells in Catarina have further cleaned up with 30 day average rates of nearly
1,600 Boe/d
Previous Operator

SN Avg (LEF & UEF)

SN Type Curve (LEF)

80,000
70,000
600-700
MBoe EUR

60,000

Cumulative Boe/d

50,000
40,000
30,000
20,000
10,000
0
0

20

40

60

Producing Days
2015 Sanchez Energy Corporation

80

100

120

15

Palmetto Overview
Acreage & Inventory
Total Net Acres
Average Working Interest
Average Net Revenue Interest
Planned Well Spacing (Acres)
Net Identified Drilling Locations (1)

~9,000
50%
37%
40
170+

Palmetto Area Acreage

Operational Update (2)

64
5

Gross Wells On Production

Awaiting Completion / Flowing Back

Well Economics
EURs (MBoe)
D&C Costs ($MM)
F&D Cost ($ / Boe)
IRR @ $60 / Bbl & $3.75 / MMBtu
% Oil / Liquids

450 - 750
$7.0 - $7.5
$9.33 - $16.67
60%+
75% / 89%

40 Acre Wells

16
1.
2.

Assumes 90% of net undeveloped acres are drillable and spaced on 40 acres
Well status as of 2/2/15

2015 Sanchez Energy Corporation

TMS Acreage Position and Activity

~69,000 net acre position in the core of the TMS

Contiguous blocky acreage with 3+ years of average remaining lease term
St. Davis Unit #1H in Amite County, Mississippi came online with a 24 hour production rate of 1,143 Boe/d and a 30 day
production rate of 920 Boe/d (91% oil); currently completing the Morris Unit #2 in Wilkinson County, Mississippi

Halcn
Fassmann 9H-1
24 HR IP: 1,006 Boe/d
30 Day IP: 461 Boe/d

Goodrich
Crosby 12-1H
24 HR IP: 1,300 Boe/d
30 Day IP: 1,137 Boe/d

Halcn
Shuckrow 10H-1
24 HR IP: 1,201 Boe/d

Goodrich
CMR / Foster Creek 2413H-1
24 HR IP: 1,215 Boe/d
30 Day IP: 947 Boe/d

Goodrich
CMR/Foster Creek 3122H-1
24 HR IP: 1,144 Boe/d
30 Day IP: 1,223 Boe/d
Encana
Sabine 12H-1
24 HR IP: 1,331 Boe/d
30 Day IP: 1,121 Boe/d

SN
Dry Fork East #2H
24 HR IP: 712 Boe/d
30 Day IP: 489 Boe/d

Encana
Sabine 12H-2
24 HR IP: 1,286 Boe/d
30 Day IP: 1,062 Boe/d

Goodrich
CH Lewis 30-19H-1
24 HR IP: 1,450 Boe/d
30 Day IP: 1,074 Boe/d

Goodrich
Nunnery 12-1H-1
24 HR IP: 815 Boe/d
30 Day IP: 533 Boe/d
Goodrich
Smith 5-29H-1
24 HR IP: 1,045 Boe/d
30 Day IP: 925 Boe/d
Encana
Anderson 17H-2
24 HR IP: 1,540 Boe/d

SN
Morris Unit #2H
Completing

Encana
Pintard 28H #2
24 HR IP: 546 Boe/d
30 Day IP: 974 Boe/d

SN
St. Davis #1H
24 HR IP: 1,143 Boe/d
30 Day IP: 920 Boe/d
Encana
Lewis 7-18H-1
24 HR IP: 1,500 Boe/d
30 Day IP: 955 Boe/d
Encana
Lyons 35H #2
24 HR IP: 1,516 Boe/d
30 Day IP: 1,145 Boe/d

2015 Sanchez Energy Corporation

Encana
Anderson 18H-1
24 HR IP: 1,178 Boe/d
30 Day IP: 1,072 Boe/d

SNs acreage position is highlighted in yellow

Encana
Mathis 29-32H-1
24 HR IP: 1,300 Boe/d
30 Day IP: 799 Boe/d

Encana
Lawson 25H-1
24 HR IP: 498 Boe/d
30 Day IP: 516 Boe/d

Goodrich
Blades 33H #1
24 HR IP: 1,270 Boe/d

17

Financial Highlights

18

2014 Sanchez Energy Corporation

Conservative Financial Strategy

Solid Financial Position and Liquidity to fund future development

Net Debt-to-EBITDA of ~1.8x as of 9/30/14
$774 million liquidity through cash and undrawn revolver facility at 4Q14
No debt maturities until 2019
Continue to maintain a balanced capital structure
Accessed the equity market four times since SNs IPO, raising over $830 million in
total proceeds
Active hedge program to protect cash flows
14,000 Bbl/d of 2015 oil production and 5,000 Bbl/d of 2016 oil production hedged
~67,000 MMBtu of 2015 gas production, 40,000 MMBtu of 2016 gas production, and
10,000 MMBtu of 2017 gas production hedged
$125 million market to market value of hedges as 12/31/14
Continue to focus on improving drilling efficiency and costs
19

2015 Sanchez Energy Corporation

Capitalization, Credit Facility, and Debt Maturity

4Q14 liquidity of $774 million

$474 million in cash

$650 million borrowing base with an

elected commitment of $300 million and
$0 million drawn

Option to further enhance liquidity to

over $1.1 billion by electing the full $650
million borrowing base

Credit Facility Details ($MM)

$700

$650

Borrowing Base

$600

Elected Commitment
Amount

$500

$400

$400

$300

$300
$200
$100

$325

$175

$300

$95

$0

Feb-2013

No debt maturities until 2019

Revolver currently 2019

Senior notes 2021 and 2023

Common shares outstanding as of

12/31/14:

May-2013

Nov-2013

Feb-2014

Nov-2014

High Yield Maturity Schedule ($MM) (1)

$1,400

$1,150

$1,200
$1,000

Basic: 58.6 million

$800

Diluted: 71.1 million

$600

$600

$400

20

$200
1.
2.

2012 high yield notes mature June 2021; 2023 high yield notes mature January 2023
Yields as of 1/29/15

2015 Sanchez Energy Corporation

$0

2015

2016-2020

2021

2022

2023

Hedge Strategy

Hedging program protects cash flow, development and capital spend

~60% of anticipated total 2015 production hedged at the mid-point of production guidance range
$125 million market to market value of hedges as 12/31/14

Use a variety of derivatives (swaps, costless collars, 3-way collars, and enhanced swaps)

Only enter into derivative agreements with counterparties that are A rated or better

Actively manage credit exposure per counterparty

Oil Hedges
80,000

$96.00

14,000

$92.00

70,000

$88.00

60,000

$4.40

$84.00

50,000

$4.20

40,000

$4.00

10,000

$80.00

8,000

$76.00

6,000

$72.00

4,000

$68.00

2,000

$64.00
$60.00

Hedged Oil (Bbls)

Oil Cap ($/Bbls)

2015 Sanchez Energy Corporation

Oil Floor ($/Bbls)

MCF per day

16,000

12,000
Bbls per day

Gas Hedges
$4.80
$4.60

$3.80

30,000

$3.60

20,000

$3.40

10,000

$3.20
$3.00

Gas (Mcf)

Gas Cap ($/Mcf)

Gas Floor ($/Mcf)

21

Hedge Positions
Commodity
Oil

Instrument
Enhanced Swaps

Period
January 1 - December 31, 2015

Daily Volume
(Bbls / MMBtu)
7,500

Oil

Swaps

January 1 - December 31, 2015

1,500

Oil

3-Way Costless Collar

January 1 - December 31, 2015

1,000

Oil

3-Way Costless Collar

January 1 - December 31, 2015

2,000

Oil

3-Way Costless Collar

January 1 - December 31, 2015

1,000

Oil

3-Way Costless Collar

January 1 - December 31, 2015

1,000

Oil

Swaps

January 1 - December 31, 2016

5,000

Gas

3-Way Costless Collar

August 1, 2014 - December 31, 2015

10,000

Gas

Enhanced Swaps

January 1 - December 31, 2015

31,000

Gas

Swaps

January 1 - December 31, 2015

25,863

Short $4.90 HHub Call / Long $4.00 HHub Put /

Short $3.50 HHub Put
$4.31 HHUB Swap
Short $3.75 HHUB Put
$3.86 HHUB Swap

Gas

Swaps

January 1 - December 31, 2016

40,000

$3.87 HHUB Swap

Gas

Swaps

January 1 - December 31, 2017

10,000

$3.65 HHUB Swap

Oil
Oil
Oil

Total Oil Hedged

Total Oil Hedged
Total Oil Hedged

Calendar Year 2015

Calendar Year 2016
Calendar Year 2017

14,000
5,000
0

Gas
Gas
Gas

Total Gas Hedged

Total Gas Hedged
Total Gas Hedged

Calendar Year 2015

Calendar Year 2016
Calendar Year 2017

66,863
40,000
10,000

% of 2015 Production Guidance At The Mid-Point Hedged

2015 Sanchez Energy Corporation

60%

Average Price
$91.99 WTI Swap
Short $74.00 WTI Put
$87.40 WTI Swap
Short $94.75 WTI Call / Long $85 WTI Put /
Short $70 WTI Put
Short $95 WTI Call / Long $85 WTI Put /
Short $70 WTI Put
Short $97 WTI Call / Long $90 WTI Put /
Short $75 WTI Put
Short $97.25 WTI Call / Long $90 WTI Put /
Short $75 WTI Put
$72.86 WTI Swap

22

Summary Investment Highlights

Operational and financial flexibility to thrive in an uncertain commodity price environment

Manufacturing process strategy delivering cost and operating efficiencies

3,300+ net drilling locations across ~226,000 net acres in the Eagle Ford

Reserve and production growth drivers

Cost savings and higher well performance leading to higher rates of return despite the lower
commodity price environment

High quality, long-term inventory of drilling locations

2015 capital plan fully funded without need to drawn on unused credit facility
Ability to preserve SNs strong liquidity position while satisfying all drilling commitments and
growing production

Successfully integrated our Catarina acquisition

Stacked pay potential across Eagle Ford trend
TMS upside potential

Management experienced with Gulf Coast trends and with resource play development

2015 Sanchez Energy Corporation

23

Appendix

24

2014 Sanchez Energy Corporation

Capitalization Summary

Revolving credit facility (due 2019)

$600 MM of 7.75% senior unsecured notes (due 2021)

No liquidity or performance based covenants

$92 MM of 4.875% cumulative perpetual convertible preferred stock, series A

Convertible into 4.3 million shares of common stock ($21.51/share)

Mandatorily convertible after 10/5/17 if common stock trades above $27.96 for at least 20 out of 30
trading days
No liquidity or performance based covenants

$177 MM of 6.50% cumulative perpetual convertible preferred stock, series B

No liquidity or performance based covenants

$1,150 MM of 6.125% senior unsecured notes (due 2023)

$650 MM borrowing base with an elected commitment of $300 million and an interest rate of LIBOR
+ 1.50% - 2.50%
Restrictive covenant: Net Debt < 4.0x TTM EBITDA

Convertible into 8.3 million shares of common stock ($21.40/share)

Mandatorily convertible after 4/6/18 if common stock trades above $27.82 for at least 20 out of 30
trading days
No liquidity or performance based covenants

Common shares outstanding as of 12/31/14:

Basic: 58.6 million

Fully diluted: 71.1 million (assuming full conversion of both series of preferred stock)

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NonGAAP Reconciliation and Measures

Reconciliation of Net Income (Loss) To
Adjusted EBITDA ($M)

Net Income (Loss)

Plus:
Interest Expense
Net Losses On Commodity Derivatives
Net Settlement On Commodity Derivatives
Premiums Paid On Commodity Derivatives Contracts
Depreciation, Depletion, Amortization, And Accretion
Stock-Based Compensation
Acquisition Costs Included in G&A
Income Tax Expense
Less:
Interest Income
Adjusted EBITDA

Reconciliation of PV-10 To
Standardized Measure ($MM)

Pro Forma
LTM Ended

Actual
LTM Ended

9/30/14

12/31/11

$98,114

$1,968

96,667
(3,274)
(10,318)
(1,325)
374,842
29,270
1,945
53,329

480
4,252
-

(100)
$639,151

(1)
$6,699

PV-10
Present Value of Future Income Taxes
Discounted at 10%
Standardized Measure

As of
9/30/14
$2,082
(248)
$1,834

As of
12/31/11
$152
(19)
$133

Explanation of Non-GAAP Measures

Adjusted EBITDA is defined by the Company as net income (loss) PLUS: (1) interest expense, including net losses (gains) on interest rate derivative contracts; (2) net losses (gains) on commodity derivatives; (3) net
settlements received (paid) on commodity derivatives; (4) premiums (paid) on commodity derivative contracts; (5) depletion, depreciation, amortization, and accretion; (6) stock-based compensation expense; (7) acquisition
costs included general and administrative; (8) income tax expense (benefit); (9) loss (gain) on sale of oil and natural gas properties; (10) impairment of oil and natural gas properties; and (11) other non-recurring items that
we deem appropriate; LESS: (1) interest income; and (2) other non-recurring items that we deem appropriate.
Adjusted EBITDA is used as a supplemental financial measure by our management and by external users of our financial statements, such as investors, commercial banks and others, to assess our operating performance as
compared to that of other companies in our industry, without regard to financing methods, capital structure, or historical cost basis. It is also used to assess our ability to incur and service debt and fund capital expenditures.
Our Adjusted EBITDA should not be considered an alternative to net income (loss), operating income (loss), cash flow provided by or used in operating activities or any other measure of financial performance or liquidity
presented in accordance with GAAP. Our Adjusted EBITDA may not be comparable to similarly titled measures of another company because all companies may not calculate Adjusted EBITDA in the same manner.
Standardized measure is calculated in accordance with Statement of Financial Accounting Standards No. 69, Disclosures About Oil and Gas Producing Activities, as codified in ASC Topic 932, Extractive ActivitiesOil and
Gas. For further information regarding the calculation of the standardized measure, see Unaudited Supplementary Information included in the financial statements included in our Annual Report for the fiscal year ended
December 31.

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