October 5-6, 2015 2 NYSE MKT: EPM Forward-Looking Statement The data contained in this presentation that are not historical facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act and Section 21E of the Exchange Act. Such statements may relate to capital expenditures, drilling and exploitation activities, production efforts and sales volumes, Proved, Probable, and Possible reserves, operating and administrative costs, future operating or financial results, cash flow and anticipated liquidity, business strategy, property acquisitions, and the availability of drilling rigs and other oil field equipment and services. These forward-looking statements are generally accompanied by words such as “estimated”, “projected”, “potential”, “anticipated”, “forecasted” or other words that convey the uncertainty of future events or outcomes. Although we believe the expectations and forecasts reflected in these and other forward-looking statements are reasonable, we can give no assurance they will prove to have been correct. These statements are based on our current plans and assumptions and are subject to a number of risks and uncertainties such as potential litigation as further outlined in our most recent 10-K and 10-Q. Therefore, the actual results may differ materially from the expectations, estimates or assumptions expressed in or implied by any forward-looking statement made by or on behalf of the Company. Cautionary Note to U.S. Investors – The SEC modified its rules regarding oil and gas reserve information that may be included in filings with the SEC. The current rules allow oil and gas companies to disclose not only Proved reserves, but also Probable and Possible reserves that meet the SEC’s definitions of such terms. We disclose Proved, Probable and Possible reserves in our filings with the SEC. Our reserves as of June 30, 2015 were estimated by DeGolyer & MacNaughton (“D&M”), and reserves in prior years include work by D&M, W. D. Von Gonten & Co., and Pinnacle Energy Services, LLC, all independent petroleum engineering firms. In this presentation, we make reference to Probable and Possible reserves, and “2P” and “3P” reserves that aggregate categories of reserves. These estimates are by their nature more speculative than estimates of Proved reserves and are subject to greater uncertainties, and accordingly the likelihood of recovering those reserves is subject to substantially greater risk. 3 Company Profile NYSE MKT: EPM Vital Statistics Texas/Gulf Coast Focus Overview (FiscalYear End June 30) Shares Outstanding (6/30/2015) (a) 32.8 MM Dilutive Securities (6/30/2015) 0.1 MM Fully Diluted Shares 33.0 MM Share Price Delhi Field Houston Headquarters Evolution Petroleum Founded 2003 Delhi Field Acquired in 2003, Operated By Denbury Resources (6/30/2015) (10/2/2015) $5.84 Market Capitalization (8/7/2015) $192 MM Common Dividend (Annualized) $0.20 Per Share Debt (6/30/2015) None Proved Reserves – 6/30/2015 12.4 MMBOE Proved PV-10 – 6/30/2015 $219 MM % Oil 80% (0% gas) % PDP 59% Avg Production (Gross/Net) 6/30/15 6,328 / 1,677 BOPD Net Working Capital (6/30/2015) $14.4 MM Borrowing Capacity (b) $5 MM (a) Does not reflect shares repurchased by company post 6/30/2015. (b) Unsecured revolver, undrawn. 4 RECOVERING MORE OIL NYSE MKT: EPM Generating Returns for Shareholders How We Allocate Capital Applying Innovative Engineering To Generate Cash Flow to Fund Growth and Dividends Recovering More By People Aligned with Shareholders • The engineering must be understandable and economics make sense Into Known Oil & Gas Assets • The financial risk must be reasonable and conservative • The investment/deal must be accretive in value and cash flow • The investment/deal must support cash returns to shareholders 5 Investment Considerations NYSE MKT: EPM Financially Strong and Shareholder Friendly High Quality Asset Base Extremely Long-Lived Production (~40 Years for Delhi) Solid, Debt-Free Balance Sheet Competitive Dividend Yield (3.4%, as of 10/2/2015) Every Employee Aligned with Shareholders through Significant Stock Ownership Well-Positioned for Opportunities in the Cycle Near-Term Growth Catalysts Long-Lived Foundation Oil Resource 7 Delhi Field NYSE MKT: EPM CO2 Enhanced Oil Recovery Asset Huge Resource 418 MMBO of Gross Original Oil In Place 192 MMBO Production Prior to EOR Project, 5+ MMBO Since Current Production 1,677 Net (6,328 gross) BOPD Growth Catalysts NGL Recovery Plant Expected Online ~Summer of 2016, Targeting 2,000+ BLPD of Higher Valued NGLs and Improved Oil Rate Planned Expansion of CO2 Flood To Remaining Eastern Area Expected To Materially Increase Oil Rate Expected Expansion of CO2 Flood To Thinner Reservoirs Other Delhi Field EOR Project Development No LA Severance Tax (12.5%) Into Next Decade Delhi Crude Sells at LLS Price With Low Transportation Cost (Typically at a Premium to WTI) 24.7 MMBOE Net 3P to Recover 100 10-Mar 10-Jul 10-Nov 11-Mar 11-Jul 11-Nov 12-Mar 12-Jul 12-Nov 13-Mar 13-Jul 13-Nov 14-Mar 14-Jul 14-Nov 15-Mar 15-Jul 15-Nov 15-Mar 7/15/206 15-Nov 3/15/2017 7/15/2017 11/15/2017 3/15/2018 7/15/2018 11/15/2018 3/15/2019 7/15/2019 11/15/2019 3/15/2020 7/15/2020 11/15/2020 Barrels Per Day 8 Delhi EOR Production Profile NYSE MKT: EPM Reversionary WI Effective Nov-2014 Delhi Field Oil and NGL Production 10,000 1,000 Reversion of Working Interest (Nov-2014) Gross Barrels EPM Net Peak Proved Pdn in 2020 Peak 2P Pdn in 2026 10 9 High Value Interests NYSE MKT: EPM 7.4% Royalty Interest Delhi Field Interest Profile • 7.4% of gross revenues • No CapEx or OpEx…ever 26.4% Net Revenue Interest 23.9% Working Interest & 19% NRI • Reversion occurred Nov-2014 • Bears 23.9% of CapEx and OpEx 10 Delhi Reserves Profile At June 30, 2015 12.4 MMBOE Proved Reserves 24.7 MMBOE 3P Reserves Poss. 12% NGL 20% Oil 80% Prob. 38% Proved 50% 11 High-Quality Reserves NYSE MKT: EPM High Developed Content & Low Cost Development $7.07 Per BOE Remaining 2P Development Cost Developed Reserves as Percent of Total by Classification 100% 90% 80% 70% 60% 50% 40% 30% 59% 43% 20% 55% 10% 0% Proved Probable Developed Undeveloped Possible 12 NGL Recovery Plant NYSE MKT: EPM Major Growth Catalyst Captures C3+ NGL Production By Projected 2,000+ BLPD Improve CO2 Flood Efficiency and Expected Oil Rate Methane Gas Recovery to Power Plant and Existing Facilities, Replacing Much or All of Currently Purchased Power & Natural Gas $24.6 MM Net CapEx Commitment $14-15 MM in Calendar Year 2015 $10-11 MM in Calendar Year 2016 Expected Startup in Summer 2016 13 Building Momentum NYSE MKT: EPM Delhi Field Development Plan Multiple Projects To Build Long-Term Value Install NGL Recovery Plant, Increase Production ~2,000 BLPD Expand CO2 Flood to Eastern Half of Delhi Field (Price Dependent) Expand CO2 Flood to Additional Thinner Intervals Patented Technology for Recovering More 15 GARP® Recovers More Oil NYSE MKT: EPM Patented Solution PROBLEM: Industry losing economic value and large quantities of reserves and production as horizontal and vertical wells are impacted by liquid loading and increased down hole gas/liquid separation problems SOLUTION: GARP® installation to accelerate production and recover tail reserves HOW IT WORKS: Supplements and enhances the existing rod pump while protecting from solids and reducing gas locking Mobilizes remaining fluid to rod pump inlet to unload liquids and insulate rod pump from gas locking PROOF OF CONCEPT: Five commercial installations currently producing Recently installed on 4 wells in Giddings Field and 1 well in Permian Three newly signed MSA’s to install for major and two large independent oil companies in Barnett and Permian 16 GARP® Recovers More NYSE MKT: EPM Development Path Path to Commercialization Established Analyze Results Pilot Patent Secured Programs Established & Adapt to Meet Industry Needs in Small Casing and Deviated Holes Early Adoption Industry Accepted Solution Well-Positioned to Endure and Capitalize 18 Liquidity and Investment NYSE MKT: EPM $19.4 MM Liquidity (June 30, 2015) Shareholder Friendly Common Dividends • $0.20 Per Common Share Preferred Dividends Unsecured Revolver, $5.0 3/31/15 Working Capital, $14.4 Flexible Share Repurchase Plan CapEx 2015/2016 • $674K per Year $23.4 MM Returned to Shareholders Since FY 2013(a) • Up to $5 MM Total • Est $14-15 MM in Cal 2015 for NGL Plant Investing in Growth NGL Recycle Plant to Capture 2,000+ BLPD (a) (1) Includes dividends on Common Stock of $9.8 MM in FY 2014, $9.8 MM in FY 2015 and $1.6 MM in FY 2016 and (2) dividends on Preferred Stock of $0.674 MM in each of FY 2013, 2014 and 2015 7.0x 1.0x 0.0x ZERO 8.0x XCO WTI EXXI SFY SN HK LGCY REN WRES TPLM MHR PVA CWEI CRK REXX SGY SM GST EPE OAS EOX CRZO RRC BBEP BCEI APC JONE LPI BBG WLL NFX NFG CPE RICE DNR AR ERN CXO AXAS PHX QEP APA DVN EQT MTDR WPX PDCE UNT EOG XEC EGN RSPP MUR PXD FANG ECR AREX SYRG MCF EGY USEG EPM 19 Strong Balance Sheet NYSE MKT: EPM Ability to Withstand the Cycle Debt to Equity (as of June 30, 2015) 9.0x Debt-Free At June 30, 2015 6.0x 5.0x 4.0x 3.0x 2.0x 20 Hedging Program NYSE MKT: EPM Capital Budget Protection Two-Thirds Estimated Production Covered Volume (BOPD) Floor ($/BBL) Ceiling ($/BBL) July – Dec 2015 550 $54.00 $66.50 July – Dec 2015 550 $56.00 $61.60 Time Period Total 1,100 Note: 1. Over 500 BOPD unhedged. 2. Hedges are for WTI exposure only; LLS spread to WTI remains unhedged. 3. No hedges in place for sales after Dec 2015. 22 Summary NYSE MKT: EPM Recovering More, Generating Returns Accretive Growth Delhi Field Production Increasing From Ongoing CO2 Flood Development Low-Cost Reserves Additions and Upgrades Installation of NGL Recovery Plant at Delhi Field – Summer 2016 Underlying Value Long-Lived (40+ Years) Cash Flow from Huge Delhi Field Resource GARP® Patented Technology Enviable Balance Sheet Ability to Weather the Cycle & Fund Growth Capital Expenditures Potential to Capitalize on Cyclical Opportunities Returning Cash to Shareholders Competitive Common Dividend - Potential For Increases Flexible $5 MM Share Repurchase Program
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