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March 2025 Investor Presentation
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Disclaimer FORWARD-LOOKING STATEMENTS This presentation relates to Sitio Royalties Corp. (the “Company”, “STR” or “Sitio”) and contains statements that may constitute “forward-looking statements” for purposes of federal securities laws. Forward-looking statements include, but are not limited to, statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “seeks,” “possible,” “potential,” “predict,” “project,” “prospects,” “guidance,” “outlook,” “should,” “would,” “will,” and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. These statements include, but are not limited to, statements about the Company's expected results of operations, cash flows, financial position and future dividends; as well as certain future plans, expectations and objectives for the Company’s operations, including statements about our return of capital framework, our share repurchase program and its intended benefits, financial and operational guidance, strategy, synergies, certain levels of production, future operations, financial position, prospects, and plans. While forward-looking statements are based on assumptions and analyses made by us that we believe to be reasonable under the circumstances, whether actual results and developments will meet our expectations and predictions depend on a number of risks and uncertainties that could cause our actual results, performance, and financial condition to differ materially from our expectations and predictions. Factors that could materially impact such forward-looking statements include, but are not limited to: commodity price volatility, the global economic uncertainty and market volatility related to changes in U.S. trade policy, including the imposition of tariffs, slowing growth and demand, especially from China, the conflict in Ukraine and associated economic sanctions on Russia, the conflict in the Israel-Gaza region and continued hostilities in the Middle East including heightened tensions and conflict with Iran, Lebanon and Yemen, voluntary production cuts by OPEC+ and others, including any additional extensions of such voluntary production cuts or the duration thereof, increased global oil, natural gas and natural gas liquids supply and those other factors discussed or referenced in the "Risk Factors" section of Sitio’s Annual Report on Form 10-K for the year ended December 31, 2024 and other publicly filed documents with the SEC. Any forward-looking statement made in this news release speaks only as of the date on which it is made. Factors or events that could cause actual results to differ may emerge from time to time, and it is not possible to predict all of them. Sitio undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future development, or otherwise, except as may be required by law. INDUSTRY AND MARKET DATA The information, data and statistics contained herein are derived from various internal (including data that Sitio has internally collected) and external third-party sources. While Sitio believes such third-party information is reliable, there can be no assurance as to the accuracy or completeness of the indicated information. Sitio has not independently verified the accuracy or completeness of the information provided by third party sources. No representation is made by Sitio’s management as to the reasonableness of the assumptions made within or the accuracy or completeness of any projections or modeling or any other information contained herein. Any information, data or statistics on past performance or modeling contained herein are not an indication as to the future performance. Sitio assumes no obligation to update the information in this presentation. BASIS OF PRESENTATION Unless otherwise noted, all net royalty acre “NRA,” gross and net well counts are as of December 31, 2024. All NRA metrics are shown on a 1/8ths royalty equivalent basis. Gross and net wells are presented on a 5,000’ basis unless noted otherwise. NON-GAAP MEASURES This presentation includes financial measures that are not presented in accordance with U.S. generally accepted accounting principles (“GAAP”). While Sitio believes such non-GAAP measures are useful for investors, they are not measures of financial performance under GAAP and should not be considered in isolation or as an alternative to any measure of such performance derived in accordance with GAAP . These non-GAAP measures have limitations as analytical tools and you should not consider them in isolation or as substitutes for analysis of results as reported under GAAP . These non-GAAP measures may not be comparable to similarly titled measures used by other companies in our industry or across different industries. This presentation also includes certain forward-looking non-GAAP measures. Due to the forward- looking nature of such measures, no reconciliations of these non-GAAP measures to their respective most directly comparable GAAP measure are available without unreasonable efforts. This is due to the inherent difficulty of forecasting the timing or amount of various reconciling items that would impact the most directly comparable forward-looking GAAP financial measure, that have not yet occurred, are out of the Company’s control and/or cannot be reasonably predicted. Accordingly, such reconciliations are excluded from this presentation. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures. See Appendix for definitions of the non-GAAP measures used in this presentation and reconciliations to the most comparable GAAP measures. 2
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Sitio’s Value Proposition 3 › Returns-Driven Acquisition Strategy (1) STR share price as of 2/25/25; share count as of 2/24/25; debt and cash balances as of 12/31/24 (2) See Appendix for non-GAAP reconciliations (3) Based on annualized 4Q24 return of capital per share of $0.49 (includes cash dividends and share repurchases) and STR closing share price as of 2/25/25. See Appendix for non-GAAP definitions Williston DJ Permian Eagle Ford › Active Asset Management Continually Enhances Business Model › High Margins, Strong Capital Structure, and Long-Term Financial Stability › Robust Return of Capital Program Enterprise Value(1) $4.1 B 4Q24 Annualized Adjusted EBITDA(2) $565 MM Total Yield(3) 10.1% 4Q24 Production 40.9 MBoe/d (47% Oil) Net Royalty Acres 273,103 74% Permian NEW MEXICO TEXAS Midland Basin Delaware Basin
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57% 31% 4% 21%1% 13% 10% 20% 57% >$10B Mkt. Cap. Sitio’s Minerals are Operated by Large, Well-Capitalized Companies Note: Market data per FactSet as of 2/25/25. CVX pro forma for HES (1) 4Q24 Gross Wells TIL inclusive of wells on STR acreage only >$100B >$50B >$20B >$5B <$5B Private 4Q24 Production by Operator Market Cap. STR’s top operators have become better capitalized, leading to increased resiliency through commodity cycles 4 Top 10 STR Operators by 4Q24 Production Operator (Ticker) % of 4Q24 Production 4Q24 Gross Wells TIL(1) 1 CVX 11.7% 271 2 XOM 9.7% 361 3 COP 9.5% 48 4 OXY 8.9% 68 5 APA 6.8% 37 6 CIVI 4.9% 49 7 FANG 4.9% 282 8 PR 4.7% 30 9 Tap Rock 4.4% - 10 DVN 4.2% 71 Total 69.8% 1,217 >$10B
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27.8 29.7 25.0 27.5 24.5 19.7 18.3 19.1 21.4 20.4 47.5 48.0 44.1 48.9 44.9 2023 Qtr Avg. 3/31/24 6/30/24 9/30/24 12/31/24 Net Spuds Net Permits Quarterly Average (1Q23 – 3Q24 ) Net Line-of-Sight (“LOS”) Wells Provide Insight into Near-Term Operator Activity 5 Net LOS Wells Note: CVX pro forma for HES (1) Excludes net LOS wells from DJ Basin Acquisition, which closed in April 2024 TEXAS NEW MEXICO Net Spuds Net Permits 12/31/24 Net LOS Wells – Top Operators (1) Permian Basin LOS Wells 12/31/24 Spuds Permian Basin LOS Wells 12/31/24 Permits STR NRAs STR AOI
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9.3 9.5 9.6 9.8 10.3 10.1 10.4 10.7 10.8 50 75 100 125 150 200 250 300 350 400 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Permian Frac Fleets Permian Rig Count 6 Macro Trend: Operators are Realizing Efficiency Improvements in the Oilfield Permian Basin production has grown steadily despite decreasing rigs and frac fleets Permian Production, Rigs and Frac Fleets Permian Rig Count Permian Frac Fleet Count Permian Production (MMboe/d) Source: Rigs per Baker Hughes, frac fleets per Kayrros, and production per EIA
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Minerals Consolidation is in the Early Innings 7 (1) See Appendix for definitions of Mineral and Royalty companies and E&P companies. Market cap calculated using 2/28/25 share price and most recent publicly available share counts (2) Total U.S. oil and gas royalty revenue is calculated using 2024 EIA monthly oil and gas production data, multiplying by average monthly WTI and HHUB spot prices according to the EIA. Royalty payments calculated assuming an average lease royalty of 18.75% and that 20% of oil and gas production occurs on federal acreage where all royalties go to the government. PHX royalty revenue annualized as of 9/30/2024 (3) Latest publicly reported data as of 2/28/25. Acquirable acreage defined as any acreage in which Sitio can purchase mineral rights or NPRIs that are not owned by CVX, TPL or VNOM. Non-acquirable acreage is comprised of federal and state-owned minerals and royalties where the government does not sell minerals or NPRIs and minerals owned by CVX, TPL and VNOM. CVX mineral ownership based on calculating the surface acreage of CVX minerals ownership in Culberson, Loving and Reeves counties and applying a 12.5% royalty interest. Assumes maximum royalty interest of 25% on all gross acres, adjusted to 1/8th royalty equivalent basis Total Permian NRAs: ~13mm Sitio: ~200,000 NRAs Non-acquirable: ~3mm NRAs Acquirable: ~10mm NRAs Estimated Permian Basin NRA Ownership(3) Sitio is well positioned to consolidate the fragmented minerals market Total Combined Market Capitalization ($bn)(1) Estimated Total Royalty Payments in the U.S.(2) $53 $535 Mineral and Royalty E&P Fewer than 10 public oil and gas royalty companies vs. 35+ public E&P operators ~96% ~4% Royalties paid to private mineral owners Public mineral company revenue ~$71 bn in 2024 2% 23% 75%
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2024 Key Takeaways 8 (1) See Appendix for non-GAAP reconciliations (2) Pro forma for the previously announced DJ Basin Acquisition that closed on 4/4/24, as if it was owned on 1/1/24 (3) Please refer to the Appendix for more details regarding Average IRR and NTM FCF (4) Includes dividends declared with respect to 4Q24 (payable 3/28/25) (5) STR share price as of 2/25/25. Share count as of 2/24/25 (6) Since 2Q22. Production per Debt-Adjusted Share = (average reported production during the quarter) / ((avg. share count of quarter) + (avg. net debt / avg. share price during the quarter)). See Appendix for definitions (7) Selected Mineral & E&P peers noted on page 14. 2024 Free Cash Flow is calculated as Cash Flow from Operations less Capex; Adjusted Net Debt is calculated as interest-bearing debt, plus preferred equity, less cash. See Appendix for definitions Topped consensus estimates for 4Q24 production (~41 MBoe/d) and Adjusted EBITDA(1) (~$141 MM) Full year 2024 pro forma production (>39 MBoe/d) exceeded high end of STR guidance(2) Solid Financial Performance1 Closed 16 transactions in 2024 for $350 MM, adding >20,000 NRAs Returns exceeded STR underwriting thresholds (avg. IRR > 15%, NTM FCF > 25%)(3) Accretive Acquisitions Enhance Outlook2 $843 MM(4) cumulative return of capital since becoming public in 2022 (~29% of market cap)(5), $334 MM attributable to 2024Strong Returns to Shareholders3 $19 MM of missing revenue captured in 2024 (offsetting ~2/3rds of 2024 Cash G&A)(1) Future unit cost savings in G&A per Boe due to proprietary data management systems Investments in People and Technology Create a More Scalable Enterprise4 High Adjusted EBITDA Margins(1) (>90%), consistent growth in Production per Debt-Adjusted Share (~20% CAGR)(6), Adjusted Net Debt / 2024 FCF ~half of peer average(7) De-risked exposure to premier oil and gas resource (no drilling capital or direct operations risk) Proven Business Model, Strong Capital Structure5
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$141 MM Adjusted EBITDA Net TIL wells increased 9% QoQ 44.9 Net Wells Line of Sight (LOS) Operator ActivityAverage Daily Production 4Q24 Highlights 9(1) See Appendix for non-GAAP reconciliations 40.9 MBoe/d Total Production 14% YoY increase Financials(1) 91% Adjusted EBITDA margin Return of Capital $0.49 Per Share Total shareholder return of capital $0.41 / share cash dividend and an equivalent $0.08 / share of stock repurchases Cost Structure $1.90 Per Boe Cash G&A Record low, down nearly 5% from 4Q23 Acquisitions $140 MM in cash Adds approximately 3,300 NRAs 4Q24 deals primarily in the Delaware Basin 8.3 Net Wells Turned-in-Line (TILs) $117 MM Discretionary Cash Flow 47% Oil 19.4 MBbls/d Oil Production
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1,289 2,677 3,986 13,687 2,325 615 16,626 19 14,995 17,320 20,612 20,612 1Q24 2Q24 3Q24 4Q24 2024 Full Year Permian DJ Sitio Made $350MM in Acquisitions in 2024 at Robust Returns 10Note: Please refer to the Appendix for more details regarding Average IRR and NTM FCF NRAs Acquired in 2024 # of Deals: 1 16357 › Consistent business development effort throughout 2024 yielded: − $350 million in acquisitions − ~20,612 NRAs acquired in the Permian and DJ Basins › Weighted average returns exceeded STR underwriting thresholds − Average IRR > 15% − NTM FCF Yield > 25%
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Maximizing Returns Through Balanced Capital Allocation Framework 11 Capital Allocation Priorities › Committed to returning at least 65% of DCF to shareholders through cash dividends and share repurchases − $200 MM buyback authorization; ~$82 MM remaining as of 12/31/24 › Up to 35% DCF retained to protect the balance sheet and opportunistically make cash acquisitions % of DCF $MM Per Share 4Q24 Discretionary Cash Flow (“DCF”)(3) $116.9 $0.77 4Q24 DCF Returned to Shareholders 65% $75.5 $0.49 Cash Dividend 54% $62.6 $0.41 Share Repurchases 11% $12.9 $0.08 Note: Numbers may not add due to rounding (1) Includes dividends declared with respect to 4Q24 (payable 3/28/25) (2) Market capitalization as of 2/25/25 (3) See Appendix for non-GAAP reconciliations Discretionary Cash Flow 35% ≥ 30% ≤ 35% Sitio’s Return of Capital Framework 4Q24 Return of Capital Summary $843 MM returned to shareholders(1) ~29% of current Market Cap(2) Cumulative Return of Capital Since 2Q22 Return Of Capital Retained Cash Flow Minimum Dividend Additional Dividend and/or Buybacks Retained Cash
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Division Order Automation Revenue Automation Reconciliation and Recovery Optimizing Asset Value and Cash Flow with Sitio Asset Management System 12 › Custom-built application processes and approves 300+ division orders a month › Utilizes proprietary AI models to interpret contracts that enable us to identify revenue payment discrepancies. › Custom-built application processes revenue across STR’s ~46,000 ownership interests › STR’s proprietary app distills revenue data from 20.8 MM rows to ~100,000 records for staff to process each year (>99% reduction) › Frees up human capital for higher order analytics › Comparing data from previous steps, identifies discrepancies in ownership, production volume or revenue › Discrepancies ranked by value for STR professionals to audit › $19 MM of missing revenue captured in 2024 (offsetting ~2/3rds of STR 2024 Cash G&A) (1) 27,621 HZ wells 290 operators 196 checks per month 8,835 rows of data per check 20.8 MM rows of data per year 0.1 MM records to review by STR staff per year (1) See Appendix for non-GAAP reconciliations
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Delivering Consistent Production Growth per Debt-Adjusted Share 13Note: Production per Debt-Adjusted Share = (average reported production during the quarter) / ((avg. share count of quarter) + (avg. net debt / avg. share price during the quarter)). See Appendix for non-GAAP definitions Since becoming public in 2Q22, Sitio delivered total production per debt-adjusted share growth of 59% (~20% CAGR) 0 10 20 30 40 50 0 5 10 15 20 25 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 Reported Production (MBoe/d) Production (Boe) per Thousand Debt-Adjusted Shares Reported Production (MBoe/d) Production (Boe) per Thousand Debt-Adjusted Shares
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0.3x 0.9x 0.9x 1.0x 1.0x 1.8x 1.9x 2.1x 2.4x 2.7x 2.8x 3.4x 3.5x 3.9x 4.3x 4.9x 5.4x 6.1x 7.1x 7.8x 9.6x 10.5x 18.7x Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 STR Peer 9 Peer 10 Peer 11 Peer 12 Peer 13 Peer 14 Peer 15 Peer 16 Peer 17 Peer 18 Peer 19 Peer 20 Peer 21 Peer 22 Average: 4.5x Net Debt to FCF Compares Well to E&P and Mineral Peers 14 Source: Latest available company filings and FactSet as of 2/25/25. Balance sheets pro forma for announced transactions (1) Represents Adjusted Net Debt over expected Free Cash Flow for 2024, based on consensus analyst estimates for each respective company. Free Cash Flow is calculated as Cash Flow from Operations less Capex for E&P peers. Cash Flow from Operations is used for Mineral peers. Adjusted Net Debt is calculated as total short-term and long-term debt (excluding any debt issuance costs, discounts and premiums), plus preferred or mezzanine equity, less cash. For Sitio, Adjusted Net Debt is equal to Net Debt, please see page 15. See Appendix for non-GAAP definitions (2) Peers include APA, AR, BSM, BTE, CHRD, CIVI, CNX, CRC, CRGY, FRU, GPOR, HPK, KRP, MGY, MNR, MTDR, MUR, NOG, RRC, SM, VNOM, VTLE Adjusted Net Debt to 2024E FCF(1)(2)
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$925 MM RBL $600 MM -50 50 150 250 350 450 550 650 750 850 950 2023 2024 2025 2026 2027 2028 2029 2030 Strong Balance Sheet and Financial Flexibility with No Near-Term Maturities 15 Debt Maturity Profile as of 12/31/24 ($MM) Note: Senior unsecured notes balance is principal only and is not net of unamortized issuance costs (1) See Appendix for non-GAAP definitions 7.875% senior unsecured notes due 2028 $437 MM undrawn availability $488 MM drawn Capitalization as of 12/31/24 ($MM) Cash $3 Revolving credit facility 488 Senior notes due 2028 600 Total debt $1,088 Net debt(1) 1,085 Revolver borrowing base 925 Liquidity $440 Revolver borrowing base increased to $925 MM from $850 MM in December 2024
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2025 Outlook 16 Assumptions › Guidance does not include the impact of potential acquisitions › Similar to prior years, expect to remain active on the M&A front supported by a robust deal pipeline (1) See appendix for non-GAAP definitions (2) Estimated cash tax guidance range is based on expectations at NYMEX forward strip pricing on 2/26/25 and for the assets owned on 2/26/25 2025 Full Year Guidance Production Average daily production (Boe/d) 38,250 – 41,250 Average daily oil production (Bbls/d) 17,750 – 19,250 Expenses & Taxes Cash G&A ($ in millions) (1) $36.5 – $39.5 (annual) Production taxes and other (% of royalty revenue) 7.0% – 9.0% Estimated cash taxes ($ in millions)(2) $26.0 – $30.0 (annual) Note: Represents Sitio’s 2025 Full Year Guidance issued on 2/26/25
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Appendix 17
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The Sitio Approach – A Commitment to Excellence & Innovation 18 • Dedicated multi-disciplinary team focused on capturing maximum value from existing minerals portfolio and acquisitions • Streamlined workflow to effectively evaluate 46,000+ interests across 27,000+ wells • ~21 million lines of revenue check data processed per year • Deep technical team with proven underwriting track record • Target mid to high teens risk adjusted unlevered IRRs • Strong preference for relationship- driven, privately negotiated deals • Basin and commodity agnostic; returns focused • Culture of continuous improvement and innovation boosts company-wide impact by sharing insights that elevate future decision-making and provide competitive advantages
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Minerals and Royalties are a Structurally Advantaged Asset Class 19 ProfitableSimple Efficient Scalable Mineral interests are perpetual real property interests; typically senior to all claims in capital structure No physical operations or associated regulatory risks No environmental liabilities or scope 1 emissions Highest margin component of the energy value chain Sector leading EBITDA to free cash flow conversion efficiency Ability to return majority of discretionary cash flow to shareholders while maintaining a conservative balance sheet 100% of capital expenditures are discretionary and tied to corporate investments and acquisitions No field staff or lease operating expenses Data management systems improve royalty management G&A expenses do not increase linearly with company scale Significant consolidation opportunities given fragmented market Incremental value extracted from each acquisition through efficient management of assets as the permanent owner
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Commitment to Corporate Responsibility Drives Long-Term Value 20 Learn more at www.sitio.com/corporate-responsibility/ Sitio’s inaugural Corporate Responsibility Report Key elements of corporate responsibility ˃ Leading governance model provides strong alignment with shareholders ˃ Management incentive compensation is 100% equity and the majority is linked to long-term absolute total shareholder returns ˃ No scope 1 emissions; minimal scope 2 emissions only from power consumption at Sitio office locations ˃ Diverse workforce and Board ˃ Responsibility goes beyond direct operations – strives to positively impact society Supportive of Diverse Workforce & Surrounding Communities High Standard of Ethics, Accountability & Transparency Environmentally Responsible Strong Corporate Governance
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E&P Companies Have Significant Remaining Drilling Inventory on Sitio’s Acreage 21 Gross Normalized Remaining Inventory 44,469 Total Net Normalized Remaining Inventory 390.0 Total Note: Inventory as of 12/31/24. Excludes spuds and permits on Sitio’s acreage - 1,000 2,000 3,000 4,000 5,000 6,000 Avalon / First Bone Spring Second Bone Spring Third Bone Spring Wolfcamp XY Wolfcamp A Wolfcamp B Wolfcamp C Wolfcamp D Wolfcamp C / Wolfcamp D Middle Spraberry Lower Spraberry Wolfcamp A Wolfcamp B DJ Eagle Ford Williston - 10 20 30 40 50 60 70 80 Avalon / First Bone Spring Second Bone Spring Third Bone Spring Wolfcamp XY Wolfcamp A Wolfcamp B Wolfcamp C Wolfcamp D Wolfcamp C / Wolfcamp D Middle Spraberry Lower Spraberry Wolfcamp A Wolfcamp B DJ Eagle Ford Williston Non-Permian Midland Basin Delaware Basin Non-Permian Midland Basin Delaware Basin Operators have drilled ~6,000 5k’ normalized wells per year on Sitio’s acreage over the past 3 years
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Large-Scale, Diverse Asset Base with Active Operators and ~10 Years of Remaining Development 22 Other 8,646 Gross LOS Wells 44.9 Net LOS Wells Delaware Basin Midland Basin DJ Basin Other(2) LOS Wells as of 12/31/24 Inventory Wells as of 12/31/24 Gross Wells TIL on STR’s Current Assets(1) Net Wells TIL on STR’s Current Assets(1) Other Exxon Chevron Diamondback Oxy ConocoEOGDVN Mewbourne Permian Resources Note: Historic gross and net wells pro forma for all acquisitions. CVX pro forma for HES. ~10 years of remaining development includes both LOS and inventory wells (1) Represents activity based on publicly reported data on all assets owned by Sitio on 12/31/24. 2H24 adjusted to match STR’s reporting methodology (2) Other consists of Williston and Eagle Ford Basins Exxon Diamondback Conoco Chevron Oxy EOGVitalAPA Mewbourne 44,469 Gross Inventory Wells 390 Net Inventory Wells 0 5 10 15 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 0 500 1,000 1,500 2,000 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24
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1H2025 1H2025 Oil Swaps Natural Gas Swaps Bbl per Day 1,100 MMBtu per Day – Weighted-Average Price ($/Bbl) $74.65 Weighted-Average Price ($/MMBtu) – Oil Collars Natural Gas Collars Bbl per Day 2,000 MMBtu per Day 11,600 Average Call ($/Bbl) $93.20 Average Call ($/MMBtu) $10.34 Average Put ($/Bbl) $60.00 Average Put ($/MMBtu) $3.31 Commodity Derivatives as of 12/31/24 23
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Non-GAAP Reconciliations 24 Adjusted EBITDA ($000s) Three Months Ended December 31, 2024 2023 Net income $ 19,329 $ (91,716) Interest expense, net 21,531 21,678 Income tax expense 6,202 (21,168) Depreciation, depletion and amortization 80,401 68,602 Loss on sale of oil and natural gas properties — 144,471 EBITDA $ 127,463 $ 121,867 Non-cash share-based compensation expense 6,278 4,393 Losses (gains) on unsettled derivative instruments 7,254 (12,194) Loss on debt extinguishment — 20,096 Merger-related transaction costs 254 875 Adjusted EBITDA $ 141,249 $ 135,037
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Non-GAAP Reconciliations 25 Discretionary Cash Flow ($000s) Three Months Ended December 31, 2024 2023 Cash flow from operations $ 105,698 $ 132,682 Interest expense, net 21,531 21,678 Income tax expense (benefit) 6,202 (21,168) Deferred tax (expense) benefit (5,282) 27,839 Changes in operating assets and liabilities 14,180 (25,610) Amortization of deferred financing costs and long-term debt discount (1,334) (1,259) Merger-related transaction costs 254 875 Adjusted EBITDA $ 141,249 $ 135,037 Less: Cash and accrued interest expense 20,196 19,628 Estimated cash taxes 4,181 8 Discretionary Cash Flow $ 116,872 $ 115,401
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Non-GAAP Reconciliations 26 Cash G&A ($000s) Three Months Ended December 31, Twelve Months Ended December 31, 2024 2023 2024 2023 General and administrative expense $ 13,876 $ 11,834 $ 54,725 $ 49,620 Less: Non-cash share-based compensation expense 6,278 4,393 23,836 18,867 Merger-related transaction costs 254 875 710 3,970 Rental income 185 135 680 512 Cash G&A $ 7,159 $ 6,431 $ 29,499 $ 26,271
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Non-GAAP Definitions and Other Definitions Adjusted EBITDA, Discretionary Cash Flow and Cash G&A are non-GAAP supplemental financial measures used by our management and by external users of our financial statements such as investors, research analysts and others to assess the financial performance of our assets and their ability to sustain dividends and/or share repurchases over the long term without regard to financing methods, capital structure or historical cost basis. Sitio believes that these non- GAAP financial measures provide useful information to Sitio's management and external users because they allow for a comparison of operating performance on a consistent basis across periods. We define Adjusted EBITDA as net income (loss) plus (a) interest expense, (b) provisions for income taxes, (c) depreciation, depletion and amortization, (d) non-cash share-based compensation expense, (e) impairment of oil and natural gas properties, (f) gains or losses on unsettled derivative instruments, (g) change in fair value of the warrant liability, (h) management fee to affiliates (i) loss on debt extinguishment, (j) merger-related transaction costs, (k) write off of financing costs and (l) loss on sale of oil and gas properties. We define Discretionary Cash Flow for the three months ended December 31, 2024 as Adjusted EBITDA, less cash and accrued interest expense and estimated cash taxes. We define Discretionary Cash Flow for the three months ended December 31, 2023 as Adjusted EBITDA, less cash and accrued interest expense and cash taxes. We revised our definition of Discretionary Cash Flow following this period to reflect our anticipated accrual of taxes period-to-period due to the runoff of tax credits associated with the Brigham merger. We define Cash G&A as general and administrative expense less (a) non-cash share-based compensation expense, (b) merger-related transaction costs and (c) rental income. Merger-related transaction costs for the three and twelve months ended December 31, 2023 have been recast to conform to the curr ent period presentation. We define Total Yield as the sum of return of capital made to shareholders in the form of dividends and share repurchases, expressed as a percentage of share price over a specified period. We define Adjusted EBITDA Margin as Adjusted EBITDA expressed as a percentage of total revenue. We define Production per Debt-Adjusted Share as average reported production within a specified period, divided by the sum of (a) average number of shares outstanding within that same period, and (b) average net debt divided by the average share price within that same period. We define Net Debt as the sum of total short-term and long-term debt (excluding any debt issuance costs, discounts and premiums), less cash and cash equivalents. We define Adjusted Net Debt as the sum of (a) total short-term debt and long-term debt (excluding any debt issuance costs, discounts and premiums), and (b) preferred or mezzanine equity, less cash and cash equivalents. These non-GAAP financial measures do not represent and should not be considered an alternative to, or more meaningful than, thei r most directly comparable GAAP financial measures or any other measure of financial performance presented in accordance with GAAP as measures of our financial performance. Non-GAAP financial measures have important limitations as analytical tools because they exclude some but not all items that affect the most directly comparable GAAP financial measure. Our computations of Adjusted EBITDA, Discretionary Cash Flow and Cash G&A may differ from computations of similarly titled measures of other companies. This presentation does not include a reconciliation for 2025E Cash G&A because certain elements of the comparable GAAP financial measures are not predictable in this situation, making it impractical for the Company to forecast. Average IRR and NTM FCF Yield are based on Company underwriting assumptions at the time of offer. Average IRR reflects the Company’s risk-adjusted estimates of the asset’s production volumes over a 30-year period and both Average IRR and NTM FCF statistics are based on NYMEX forward strip pricing at the time of STR’s underwriting; asset-level expenses assumed in the IRR calculations include gathering and transportation expenses and production, severance and ad valorem taxes but do not include borrowing or general and administrative costs; realized pricing is based on differentials to benchmark pricing based on geographic location; NTM FCF is the sum of STR’s internal calculations of 12-month forward FCF for each acquisition divided by total purchase-price for the 16 acquisitions which closed in 2024. Average IRR and NTM FCF Yield presented herein are based on final Company underwriting. Realized IRR and FCF Yield may vary from underwriting. Page 7: Mineral and Royalty companies include BSM, DMLP, KRP, PHX, STR, TPL and VNOM. E&P Companies include AMPY, APA, AR, BATL, BRY, CHRD, CIVI, CNX, COP, CRC, CRGY, CRK, CTRA, DVN, EOG, EPM, EQT, EXE, FANG, GPOR, HES, HPK, KOS, VTLE, MGY, MTDR, MUR, OVV, OXY, PR, REI, REPX, RRC, SD, SM, TALO, and WTI. 27
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28 Contact Information Alyssa Stephens VP of Investor Relations Phone: (281) 407-5204 Email: IR@sitio.com