Firefly Value Partners Disappointed in Gulfport Energy Board’s Failure to Recognize Company’s Significant Opportunities

Firefly Value Partners, LP (together with its affiliates, “Firefly”), which manages funds that, together with affiliates, collectively beneficially own 13.1% of the outstanding common stock of Gulfport Energy Corporation (“Gulfport” or the “Company”) (Nasdaq:GPOR), today issued the following statement:

“We are large, long-term Gulfport shareholders because we believe Gulfport has great assets and significant opportunities for value creation. But, after years of bewildering capital allocation and governance decisions, Firefly advocated for the Board to be refreshed, in collaboration with shareholders, with directors who possess the expertise and focus on shareholder concerns needed to effectively steer Gulfport’s strategy and drive long-term value. Gulfport’s Board had a different plan: it has attempted to do a ‘self-refresh’ by adding directors hand-picked by the incumbents to try to stave-off the addition of new voices that would seek to effect meaningful change. Recent decisions by the newly constituted Board show yet again why direct shareholder representation and truly independent perspectives on the Gulfport Board are urgently needed.

Gulfport could be much more valuable than it is today, given its great assets and strong free cash flow. The Company had $693 million in liquidity as of February 26, 2020, and told shareholders it expects to be free cash flow positive in 2020. Since that February guidance, the fundamentals for the natural gas business have improved – the decline in oil prices has resulted in a significant curtailment of drilling and capital expenditures in the Permian basin by liquid-dominant drillers. With substantially less supply of natural gas from the Permian, we believe natural gas prices should increase in late 2020 and into 2021. For this reason, Gulfport’s low-cost dry gas peers (EQT, CNX and Cabot) have all seen their stock prices increase substantially in March, even as the capital markets have experienced significant dislocation. With leverage of less than 3x, no bond maturities until 2023, and improving fundamentals, Gulfport too is in a terrific position to create value for all stakeholders.

Despite its position and opportunities, and the performance of its peers, Gulfport stock has lost nearly 80% of its value in 2020, including nearly 25% in March. We believe that shareholders simply do not have confidence in the Board – with its tone-deaf ‘self-refreshment’ strategy – nor in the management team.