RSP Permian, Inc. Announces Fourth Quarter and Year-End 2016 Financial and Operating Results, Year-End 2016 Proved Reserves, 2017 Guidance and 2018 and 2019 Production Outlook

DALLAS, Feb. 27, 2017

Highlights for the Fourth Quarter and Full Year 2016:

• 4Q16 production increased 48% to 35.8 MBoe/d (71% oil, 88% liquids), compared to 4Q15
• Full year 2016 production increased 39% to 29.2 MBoe/d (73% oil, 89% liquids), compared to 2015
• 4Q16 net income of $1.4 million, or $0.01 per diluted share. Adjusted net income, which does not include certain items, was $13.4 million, or $0.10 per diluted share
• 4Q16 adjusted EBITDAX increased 22% to $90.5 million compared to 4Q15
• 4Q16 cash operating expenses of $9.11/Boe, 23% below 2015 average of $11.85
• 4Q16 development capital expenditures of $95.5 million
• Full year 2016 development capital expenditures of $294.2 million
• Entry into the Delaware Basin with previously announced $2.4 billion acquisition of Silver Hill Energy Partners, LLC ("SHEP I") and pending acquisition of Silver Hill E&P II, LLC ("SHEP II"), expected to close March 1, 2017
• Maintained strong year-end liquidity position and balance sheet, pro forma closing of SHEP II with $109 million of cash and no borrowings outstanding under revolving credit facility
  • Amended and restated credit facility, extending maturity date to December 2021, increasing borrowing base to $1.1 billion upon closing SHEP II, and increasing lender's commitments to $2.5 billion
• Pro forma proved reserves increased by 78% to 283 MMBoe⁽¹⁾ (70% oil, 88% liquids) over 2015
• Achieved low drill-bit finding and development cost of $4.05/Boe with an 848% reserve replacement ratio and a 684% organic reserve replacement ratio⁽²⁾

Recent Midland Basin Well Results

• Mask 1004/1005 two-well pad in Midland County: Two 9,500' lateral wells, targeting the Lower Spraberry and Wolfcamp B formations, flowed naturally producing almost 200,000 Boe before being put on electric submersible pump ("ESP") and establishing peak 30-day average rate of 2,932 Boe/d (73% oil)
• Spanish Trail 344 two-well pad and Spanish Trail 341 two-well pad: Four 6,500' lateral wells, with two wells each targeting the Wolfcamp A and Wolfcamp B formations, established a peak 30-day average rate of 6,212 Boe/d (79% oil) and produced in excess of 250,000 Boe in less than 60 days

2017 Guidance and 2018 and 2019 Production Outlook

• Average net daily production range of 53.0 - 57.0 MBoe/d in 2017, an 82% - 95% increase over 2016
• Development capital expenditure range of $625 - $700 million (drilling, completion, infrastructure and other) with drilling and completion of $575 - $625 million and infrastructure and other of $50 - $75 million
• 30%+ annual production growth profile in 2018 and 2019 with cash flow neutrality beginning in 2018 at $55 oil
• Expanded hedge profile covering 55% of 2017E oil production and 64% of 2017E natural gas volumes at the midpoint. Entered into basis swaps to protect Midland-Cushing differentials and began layering in 2018 oil hedges

Steve Gray, Chief Executive Officer, commented, "I am pleased to report our fourth quarter and full year results, highlighted by annual production growth of nearly 40% with 25% less in capital expenditures as compared to last year.  Importantly, we continued to operate efficiently with strong cash margins and record low drill-bit finding and development costs.  During the year, we reduced our activity levels in response to depressed oil prices early in the year and remained patient on M&A opportunities until we identified high quality properties that would compete for capital in our existing portfolio.  With our recent entry into the Delaware Basin through our $2.4 billion acquisition of Silver Hill, we believe we have assembled one of the most focused and highest returning asset bases in the Permian Basin, solidifying our ability to achieve outstanding growth and strong operating and capital efficiency for years to come."

Mr. Gray continued, "I am also pleased to announce that our shareholders have overwhelmingly approved our issuance of RSP common stock to partially fund the SHEP II transaction which we expect to close Wednesday.   We have already begun to integrate the Silver Hill assets into our inventory and are working towards achieving efficient, multi-zone horizontal development on the acquired properties.  In addition, we recently acquired the underlying water disposal infrastructure supporting our operations in the Delaware.  We are currently expanding these facilities and developing new facilities to support our growing operations and lower our operating costs.  We are also working diligently with our various midstream partners and expect to be in position to ramp our drilling program beginning in the second half of 2017.  Recent strong well results, which span five horizontal zones on the properties, highlight the attractive return profile in multiple stacked horizontal zones on our Delaware acreage position."

(1) Includes SHEP II.  Pro forma proved reserves prepared by Netherland Sewell & Associates, Inc. (NSAI).
(2) See "Drill-Bit F&D and Reserve Replacement Ratios" below for calculations.