On this page of StockholderLetter.com we present the latest annual shareholder letter from Coterra Energy Inc. — ticker symbol CTRA. Reading current and past CTRA letters to shareholders can bring important insights into the investment thesis.

 •  3/20/2025 Letter Continued (Full PDF)
 •  3/20/2023 CTRA Stockholder Letter
 •  3/20/2024 CTRA Stockholder Letter
 •  More "Oil & Gas Exploration & Production" Category Stockholder Letters
 •  CTRA Benford's Law Stock Score = 82

CTRA Shareholder/Stockholder Letter Transcript:

2024
Annual Report

Our Footprint
Permian Basin
NM
The Permian is the highest oil-producing basin in the United States, supplying nearly half
TX
of the country   s oil production in 2024. Coterra   s Permian acreage position is comprised
of 346,000 net acres across the Delaware Basin in Culberson and Reeves counties in
Texas, and Lea and Eddy counties in New Mexico. In November 2024, we announced two
acquisitions for a total consideration of $3.95 billion for 49,000 net acres primarily located
in Lea County, New Mexico. This acquisition closed in January 2025, creating a new focus
area consisting of more than 80,000 net acres in Lea County, New Mexico.
In Culberson County, Texas, our highly contiguous acreage position allows for sizable
and highly efficient projects such as    row developments   . In these row developments,
we focus on drilling and completing side-by-side projects spanning numerous sections
while targeting multiple formations at a time, all of which support lower costs, increased
hydrocarbon recovery and most importantly, enhanced project returns. The Company also
owns a significant infrastructure footprint across the basin, including three centralized
substations and more than 200 miles of electrical infrastructure, which powers our
operations using grid power. We also own and operate over 600 miles of gas gathering
pipeline and significant water transportation and disposal systems, all of which support
lower operational costs and enhanced full-cycle project economics.
OK
Anadarko Basin
In the Anadarko Basin, Coterra   s 181,000 net acres span across three development
windows, each with its own unique commodity mix. Our Updip and Lonerock areas tend to
be more oil and liquids-weighted whereas our Downdip area tends to be more natural gas
TX
and natural-gas-liquids weighted. In recent years, wider well spacing and more efficient
drilling and completion methods have increased well productivity and lowered costs,
which increased capital efficiency and bolstered project returns. Successful acreage
trades have also allowed for longer lateral projects and increased working interests across
our focus areas. The Anadarko is a key component of the Company   s diversified strategy
and continues to provide competitive returns and significant optionality.
NY
Marcellus Shale
The Marcellus Shale is one of the most prolific dry natural gas basins in the country.
PA
Coterra   s acreage position includes 186,000 net acres in the dry gas window of the
OH
MD
WV
VA
Appalachian Basin, concentrated in Susquehanna County of Northeast Pennsylvania.
The average lateral lengths of wells in our project inventory is expected to be over three
miles long. Moving to longer lateral lengths has contributed to Coterra lowering its per
foot costs by more than 20%, year-over-year, which is expected to structurally enhance
the economics of future developments in the region.

Dear Coterra
Shareholders,
We look forward to this annual letter. It provides an opportunity to zoom out from
Thomas E. Jorden
owners, about the state of our company, the opportunities and challenges we face,
and President
the details of quarterly and annual financial reporting and speak directly to you, our
our strategic priorities, and how changes in the macro environment may affect Coterra.
Chairman, Chief Executive Officer
Coterra is stronger than ever. Our recent acquisition of oil assets in the Northern
Delaware Basin significantly enhances our competitive position. In last year   s letter,
we laid out a simple test for judging potential acquisitions: Will our owners be better off
because of it? The assets we acquired pass this test with flying colors. The integration
is progressing well, allowing us to leverage economies of scale and improve capital
efficiency. We are focused on becoming better, not bigger. These bolt-on assets make
us better.
In the cyclic energy business, resilience to commodity swings is paramount.
Coterra   s diversified portfolio, combining oil and gas assets, uniquely positions us
to weather market downturns and capitalize on upswings. The 2024 declines in natural
Coterra is stronger
to oil investments. Our ability to pivot capital as commodity prices swing is a key
acquisition of oil assets in
gas prices highlighted this advantage, as we were able to slow gas activity and shift
differentiator relative to our competitors. Our balanced revenue stream, deep quality
inventory of future projects, and adaptive organization provide financial stability and
the luxury to allow capital to flow to its most productive use.
than ever. Our recent
the Northern Delaware Basin
significantly enhances our
competitive position.
Our success isn   t accidental. It stems from our long-term view of the business.
We think in terms of decades, not quarters. This mindset impacts every decision
we make     the assets in our portfolio, how we manage our balance sheet, the hiring
decisions we make and most importantly, the culture we seek to build and nurture.
We foster a culture of excellence, one that is collaborative, challenging, and nonhierarchical. We encourage employees to think independently, breaking down
organizational boundaries without hesitation or permission. We demand excellence
of ourselves and others. We perform rigorous lookbacks on our own results and force
ourselves to stand before objective analyses of the results of our decisions. This
feedback loop is critically important to improving our decision making. We need to
understand what is working and, more importantly, what is not. This is our culture.
2024 Annual Report | 1

Looking ahead, Coterra has tremendous challenges and opportunities. Commodity
prices will continue to be volatile. Our high-quality multi-basin asset portfolio provides
opportunities to invest in oil and natural gas focused areas, allowing us to profitably
navigate through volatility. Currently, oil prices are weakening while natural gas prices
are strengthening. Our current outlook projects that natural gas and natural gas liquids
will comprise more than 50% of our 2025 revenue. Our balanced commodity mix,
paired with our conservative balance sheet, strategically positions Coterra for longterm success. Coterra is built to last.
The growing U.S. and global electricity demand will have a profound impact on
our business, driving domestic natural gas and liquefied natural gas (LNG) export
demand. Depending upon supply response, increased demand for natural gas should
support robust natural gas pricing for some time to come. We are actively exploring
opportunities to further participate in this market, including power pricing and longterm supply contracts for power generation. We are analyzing our gas supply chain
broadly, seeking ways to increase our profitability. Our Delaware Basin gas gathering
and compression midstream assets provide a useful template, for these assets
enhance the profitability of our portfolio and provide us with greater operational
efficiencies. As before, the test for any strategic option is simple: Does it make us
Coterra and our industry
better and directly benefit our owners?
are proud of our contribution
The recent U.S. presidential election and other global elections are reshaping the
secure energy supply for our
and seek durable regulations that can survive changing political winds. We are pleased
to a strong, affordable, and
country, our allies, and an
energy-starved world.
energy landscape. Our approach is not political. We support sound energy policy
with the new energy team in Washington. Interior Secretary Burgum, Energy Secretary
Wright, and EPA Administrator Zeldin will facilitate infrastructure development, LNG
exports, and restore common sense to U.S. energy policy. We expect that they will
eliminate air quality regulations that fail to reduce emissions and streamline regulations
that are duplicative and burdensome.
Coterra   s commitment to emission reduction will proceed uninterrupted. It is part
of our organizational commitment to operational excellence. Our organization has
reduced our emissions more than we had ever thought possible. As our organization
has embraced our challenge to reduce emissions, we have improved in ways we did
not foresee: We engineered better facilities. We developed smarter inspection
routines. We used automation to illuminate real time operating conditions.
These are the fruits of an innovative organization. We will not stop.
U.S. energy is a precious asset for our country. It makes us stronger, safer, and cleaner,
and provides affordability. These are luxuries that most of the world only dreams about.
Coterra and our industry are proud of our contribution to a strong, affordable, and
secure energy supply for our country, our allies, and an energy-starved world.
Coterra thrives due to our dedicated and innovative employees, a strong culture that
supports and drives them, and a forward-thinking Board of Directors. We are grateful
for you, our owners, who share our long-term outlook. Thank you for your support of
Coterra. We never forget who we work for.
Thomas E. Jorden
Chairman, Chief Executive Officer
and President
2 | Coterra Energy

Differentiated and Compelling Investment Thesis
Committed to consistent, profitable
growth, and returning value to
shareholders through dividends and
share repurchases while maintaining
a conservative balance sheet
High-quality deep 15-year inventory
with low marginal cost of supply in each
of our three operating basins, which is
expected to drive strong returns and
consistent development
Uniquely diversified commodity mix
offers investment optionality and
provides ability to generate more
consistent cash flows through the
commodity cycles
Focused on operational excellence,
full-cycle returns, and maintaining
flexibility, allowing capital to flow
where it is most productive in order
to maximize shareholder return
2024 Annual Report | 3



 3/20/2025 Letter Continued (Full PDF)