Viper Energy Partners LP, a Subsidiary of Diamondback Energy, Inc., Provides Update on 2020 Production Guidance and Hedge Position

MIDLAND, Texas, March 19, 2020 (GLOBE NEWSWIRE) -- Viper Energy Partners LP (NASDAQ: VNOM) (“Viper” or the “Company”) today announced that it is updating its average daily production guidance for the full year 2020 to a range of 14,000 to 17,000 bo/d (22,500 to 27,000 boe/d). Given the current global headwinds and fluid commodity price environment, this guidance reflects the Company’s current estimated production given Diamondback’s updated development plans and contemplates only limited contribution from further development by third-party operators.

Additionally, given the dramatic decline in commodity prices and expected continued weakness, the Board of Directors of Viper’s general partner authorized the Company to hedge a majority of its 2020 and 2021 estimated oil production primarily through WTI collars to limit downside to the Company’s cash flow.

“Viper is reducing production expectations for the year due to significantly lower expected activity levels on third-party operated properties and slightly lower activity levels from Diamondback. Times like these emphasize the value of the Diamondback and Viper relationship, as Diamondback has focused its drilling on areas where Viper’s mineral ownership lowers consolidated breakeven economics. Viper has also now hedged the majority of its production, primarily through collars, to protect cash flow downside through an anticipated weak commodity price environment for an extended period of time,” stated Travis Stice, Chief Executive Officer of Viper’s general partner.

DERIVATIVES UPDATE

Below is Viper’s hedge position as of March 18, 2020. The Company continues to actively manage its hedge position by increasing downside protection and monitoring basis differentials.

As of March 18, 2020, the Company had the following outstanding derivative contracts. The Company’s derivative contracts are based upon reported settlement prices on commodity exchanges, with crude oil derivative settlements based on New York Mercantile Exchange West Texas Intermediate pricing. When aggregating multiple contracts, the weighted average contract price is disclosed.

	Crude Oil (Bbls/day, $/Bbl)
	Q2 2020				Q3 2020				Q4 2020				FY 2021
Costless Collars - WTI (Cushing)	11,000				11,000				11,000				10,000
Long Put Price ($/Bbl)	$	29.09			$	29.09			$	29.09			$	30.00
Ceiling Price ($/Bbl)	$	32.61			$	32.61			$	32.61			$	43.05
Swaps – WTI (Cushing)		1,000				1,000				1,000				—
	$	27.45			$	27.45			$	27.45			$	—