Diversified Closes East Texas Asset Acquisition

Diversified Energy Company PLC (LSE: DEC, NYSE:DEC) ("Diversified" or the "Company") announces the closing of its previously announced acquisition of operated natural gas properties located within eastern Texas (the "Assets") from a regional operator (the "Seller") (the "Acquisition").

Acquisition Highlights

• Total gross purchase price of $69 million before customary purchase price adjustments

◦ $68 million for high working-interest PDP asset package

◦ $1 million for residual (5%) interest of retained undeveloped acreage

• Acquisition net purchase price of $49 million after customary purchase price adjustments
• PDP reserves of ~70 Bcfe (~12 MMBoe) and a PDP PV10 of ~$89 million(a)
• Current net production of 21 MMcfepd (~4 MBoepd)(b)
• Estimated NTM Adjusted EBITDA of ~$19 million million(c)
• Purchase price multiple of ~3.5x(c) (gross)

As previously announced, the net consideration for the Acquisition consists of a combination of the issuance of 2,342,445 new US-dollar denominated ordinary shares to the Seller (the "New Shares"), and cash consideration of $22 million, drawing from a senior secured bank facility supported by the acquired assets and existing liquidity. The New Shares represent approximately 4.57% of the Company's existing issued share capital. The shares conveyed to the seller are subject to standard regulatory restrictions for a period of six months.

CEO Rusty Hutson, Jr. commented:

"We are excited to announce the completion of another acquisition of high-quality, bolt-on assets within our Central Region, which are immediately accretive to operations, further increase operating scale and provide the opportunity for cost synergies. We look forward to welcoming our new employees as Diversified leverages their experience for efficient integration, and the deployment of our Smarter Asset Management and sustainability initiatives across these assets."

Admission of Shares and Total Issued Share Capital

The Company has applied for the New Shares to be admitted to the Equity Shares (Commercial Companies) Category of the Official List of the Financial Conduct Authority and to trading on the Main Market of the London Stock Exchange PLC, and expects admission to occur on or around 31 October 2024. The New Shares will rank pari passu in all respects with the Company's existing ordinary shares of 20 pence each ("Ordinary Shares"), and will be eligible for trading on the New York Stock Exchange.

Following the allotment and issue of the New Shares, the Company will have 51,295,645 Ordinary Shares in issue and holds no Ordinary Shares are held in treasury. Shareholders may use the figure of 51,295,645 as the denominator in calculations to determine if they are required to notify the Company of their interest in, or a change to their interest in the Company under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules.

Footnotes:

For Company-specific items, refer also to the Glossary of Terms and/or Alternative Performance Measures found in the Company's Interim Report for the six months ended June 30, 2024.

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Use of Non-IFRS Measures

Adjusted EBITDA

PV10

PV10 is a non-IFRS financial measure and generally differs from Standardized Measure, the most directly comparable IFRS measure, because it does not include the effects of income taxes on future net cash flows. While the Standardized Measure is free cash dependent on the unique tax situation of each company, PV10 is based on a pricing methodology and discount factors that are consistent for all companies. In this announcement, PV10 is calculated using NYMEX pricing. It is not practicable to reconcile PV10 using NYMEX pricing to standardized measure in accordance with IFRS at this time. Investors should be cautioned that neither PV10 nor the Standardized Measure represents an estimate of the fair market value of proved reserves.