JANUARY 2019 NYSE American: NOG 1 This presentation contains - PowerPoint PPT Presentation

JANUARY 2019 NYSE American: NOG 1

This presentation contains forward-looking statements regarding future events and future results that are subject to the safe harbors created under the Securities Act of 1933 (the “Securities Act”) and the Securities Exchange Act of 1934 (the “Exchange Act”). All statements other than statements of historical facts included in this presentation regarding Northern’s financial position, business strategy, plans and objectives of management for future operations, industry conditions, and indebtedness covenant compliance are forward-looking statements. When used in this presentation, forward-looking statements are generally accompanied by terms or phrases such as “estimate,” “project,” “predict,” “believe,” “expect,” “continue,” “anticipate,” “target,” “could,” “plan,” “ int end,” “seek,” “goal,” “will,” “should,” “may” or other words and similar expressions that convey the uncertainty of future events or outcom es. Items contemplating or making assumptions about actual or potential future sales, market size, collaborations, and trends or operating results also constitute such forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond our company’s control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following: changes in crude oil and natural gas prices, the pace of drilling and completions activity on Northern’s current properties and properties pending acquisition, Northern’s ability to acquire additional development opportunities, changes in Northern’s reserves estimates or the value thereof, general economic or industry conditions, nationally and/or in the communities in which Northern conducts business, changes in the interest rate environment, legislation or regulatory requirements, conditions of the securities markets, Northern’s ability to consummate any pending acquisition transactions, other risks and uncertainties related to the closing of pending acquisition transactions, Northern’s ability to raise or access capital, changes in accounting principles, policies or guidelines, financial or political instability, acts of war or terrorism, and other economic, competitive, governmental, regulatory and technical factors affecting our company’s operations, products and prices . Northern has based these forward-looking statements on its current expectations and assumptions about future events. While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond Northern’s control. Northern does not undertake any duty to update or revise any forward-looking statements, except as may be required by the federal securities laws. 2

NORTHERN – REPOSITIONED AHEAD OF PLAN 1) STRATEGY REVIEW & YTD 2018 HIGHLIGHTS 2) FINANCIAL RESULTS & GUIDANCE 3) ACQUISITIONS 4) KEY TAKEAWAYS 3

Position:  151,978 net acres (1)  Large highly economic net well inventory  95% held, 97% held in North Dakota (1) Production:  3Q 2018 averaged 26,708 BOE/d, 84% crude  4Q 2018 guidance mid-pt. 35,500 BOE/d Hedges Protecting Liquidity:  Swaps (3)  4Q18 – 1,855,300 Bbls hedged @ $63.66  2019 – 6,851,730 Bbls hedged @ $63.32  2020 – 5,284,080 Bbls hedged@ $59.75  2021 – 1,857,600 Bbls hedged@ $59.36  Crude Oil Derivative Basis Swaps (3)  2019 – 3,650,000 Bbls @ -$2.41  $285.0 million of liquidity (4) Enterprise Value $1.920 (2) billion:  $1.080 billion Market Cap (2)  $700 million 8.5% Senior Secured 2L Notes due 2023 NOG Leasehold 2019 Acquired Leasehold  $140 million drawn on new credit facility (4) (1) As of 9/30/18 – Pro Forma for W Energy Acqusisition. 4 (2) As of 1/21/19 (3) Open crude oil derivative contracts scheduled to settle after September 30, 2018, Basis swaps are settled using the TMX UHC 1a index, as published by NGX. (4) Remaining availability on $425 million reserved based lending facility less $140 million drawn as of December 31, 2018.

Organic Activity Market Conditions Acquisitions Capital Allocation A Returns Focused Refinance Debt Strategy for All Cycles Return Capital to Stakeholders 5

GROWTH – Organic and Acquisitions Ahead of Plan Driving – Production Growth = 70%+ year-over-year Driving – 3Q18 Adjusted EBITDA up 174% year-over-year Driving – Cash Flow and Reactivated stock buy-back plan Balance Sheet Transactions & Debt Metrics Improvements Capital Allocation Moving to Returning Capital to Shareholders 6

Committing Capital to the Highest Return Wells Well costs stable over the last 7 quarters Weighted Average AFE Costs Weighted Average IRR 70% $10.0 $9.0 58% 55% $8.1 60% $8.1 $8.1 $7.9 $7.9 55% $7.8 $7.6 $7.6 $8.0 $6.8 50% $6.6 $7.0 43% $6.0 37% 37% 40% 36% 37% 35% $MM 32% $5.0 30% $4.0 $3.0 20% $2.0 10% $1.0 0% $0.0 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 Q4 '17 Q1 '18 Q2 '18 Q3 '18 Q4 '18 Q3 '16 Q4 '16 Q1 '17 Q2 '17 Q3 '17 Q4 '17 Q1 '18 Q2 '18 Q3 '18 Q4 '18 Consented Wells Non-Consent Wells Consented Wells 7 Source: All company wells as of December 31, 2018. IRRs based on management’s internal estimate at time each well is evaluated for consent/non -consent.

Consistently Funding Attractive AFEs… …Generates Consistent Production Growth 35.0 75% CAGR (Est) 35,500 30.0 Quarterly Activity Net Organic Wells Added to PDP 7.7 59% CAGR 25.0 26,708 9.3 7.1 5.8 8.1 20.0 21,046 3.6 4.3 16,742 17,995 2.0 15.0 13,299 13,794 15,321 22.8 10.0 19.2 19.0 18.3 16.4 16.1 18.0 15.1 5.0 0.0 1Q '17 2Q '17 3Q '17 4Q '17 1Q '18 2Q '18 3Q '18 4Q '18 1Q '17 2Q '17 3Q '17 4Q '17 1Q '18 2Q '18 3Q '18 4Q '18 Est. Production (Boe/d) Wells In Process @ Period End Organic Net Wells added to PDP 8

Increasing Well Productivity Economics by EUR & Commodity Price (2) (1) 2015 Cum (1) 2016 Cum 200% 280,000 1,100 Mboe: $7.5MM CWC (1) 2017 Cum (1) 2018 Cum 1,000 Mboe: $7.5MM CWC 181% 700 Mboe Type Curve 180% 240,000 800 Mboe Type Curve 900 Mboe: $7.5MM CWC ~25% 900 Mboe Type Curve 800 Mboe: $7.5MM CWC 1,000 Mboe Type Curve 160% Cum Production (Boe) 200,000 700 Mboe: $7.5MM CWC 140% 146% 160,000 110% 120% 120,000 115% IRR 100% 91% 80,000 80% 40,000 81% 61% 71% 60% - 65% 50% - 30 60 90 120 150 180 210 240 270 300 330 360 52% Days Online 40% 40% 40%  2018 vintage wells better than ever 29% 22% 20% 2018 wells tracking over a 1,000 MBoe EUR Type Curve  0% $50 WTI $60 WTI $70 WTI  Combined with stable costs and high realized prices is generating $3.00 HH $3.00 HH $3.00 HH strong capital efficiency and returns (1) Wells assigned to years based on year in which they started producing. Cumulative type curves comprised of the following numbers of gross wells: 2015 – 296; 2016 – 162; 2017 – 297; 2018 – 473. 9 Includes producing wells as of November 30, 2018. (2) Includes $4.00/bbl differential.

Liberty 45-1311H Gabriel 1-36-25H Wold Federal 44-7-4XH Shorty 4-9F 3H Wiley 8-25H 1 2 3 4 5 EOG (IP: August 2018) Slawson (IP: July 2018) Whiting (IP: August 2018) Equinor (IP: April 2018) Continental (IP: June 2018) Peak 30: 2,036 Boepd Peak 30: 1,132 Boepd Peak 30: 1,568 Boepd Peak 30: 1,376 Boepd Peak 30: 2,289 Boepd EN-Sorenson B-LE-155-94-3526H-1 Liberty 114-1311H Hess (IP: August 2018) EOG (IP: August 2018) 6 1 Peak 30: 1,448 Boepd Peak 30: 1,476 Boepd 4 6 Lars 14-8H Gabriel 5-36-25TFH 7 Marathon (IP: August 2018) Slawson (IP: July 2018) 2 Peak 30: 1,648 Boepd Peak 30: 1,355 Boepd 3 3 6 5 10 Orvis State 150-99-21-16-5H Wold Federal 44-7-1TFH 1 1 2 2 9 8 Newfield (IP: July 2018) Whiting (IP: August 2018) 3 4 9 Peak 30: 2,278 Boepd Peak 30: 1,745 Boepd 8 8 5 Sibyl USA 44-19TFH Faye 1C MBH 4 Burlington (IP: July 2018) Marathon (IP: September 2018) 9 Peak 30: 1,421 Boepd Peak 30: 3,746 Boepd 10 7 7 Burr Federal 8-26H2 Crane Federal 5300 34-24-12B 5 Continental (IP: August 2018) 10 Oasis (IP: July 2018) Peak 30: 1,013 Boepd Peak 30: 1,327 Boepd NOG Leasehold Acquired Leasehold Three Forks Wells Middle Bakken Wells USA 153-95-23D-14-1H Hartvig 14-8TFH Miles 6-6H2 Thorvald 4-6H1 Gobbler Federal 6-35-26TFH 7 8 Continental (IP: September 2018) 10 Petro-Hunt (IP: July 2018) 6 Marathon (IP: August 2018) Continental (IP: July 2018) Slawson (IP: September 2018) 9 Peak 30: 1,412 Boepd Peak 30: 1,767 Boepd Peak 30: 1,270 Boepd Peak 30: 1,400 Boepd Peak 30: 1,704 Boepd 10 Sources: Company info, North Dakota Industrial Comission, and DrillingInfo.

Percentage of Producing Wells – By Operator Top 10 Operators 1 Slawson 11.9% 2 Continental 14.2% 3 Whiting 8.0% 4 Hess 5 ConocoPhillips 6 Oasis 7.4% 15.1% 7 XTO Energy 8 Equinor (Statoil) Less Than 2% 5.0% 9 Petro-Hunt Dakota 4.7% 10 Marathon 4.9% 13.3% 3.7% 2.9% 2.6% 6.5% Between 2% and 2.5% Petro-Hunt Dakota, LLC 11 Source: Company info as of December 31, 2018