Diversified Energy Co PLC
For the period ended Dec 31, 2023. Filed Mar 19, 2024.
View on SEC.govAbout this filing
The yearly report of a company based outside the US. It covers much of what a 10-K does, and may follow accounting rules other than US ones.
FY2023 · Filed Mar 19, 2024
DEC$12.70-0.8%Stored close · as of Nov 6, 2026
Contents
Chief Executive’s Statement
| Strategic Report | Corporate Governance | Group Financial Statements | Additional Information | 9 |
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| The fundamental need for natural gas is well-cemented in our domestic and global energy outlooks. Natural gas is the essential fuel to tackling global challenges – from enhancing energy security of the United States and allies around the world to addressing the universally shared need for reliable, affordable, and sustainable power, natural gas demand remains strong.It’s against this backdrop of rising global energy demand, consolidation in the U.S. energy markets, and enhanced expectations for sustainably produced energy that the case for Diversified’s stewardship business model sharpens. Thanks to our approach – focused on acquiring, improving, and retiring existing, long-life U.S. energy assets and honed through two decades of field experience – Diversified is the “Right Company at the Right Time” to responsibly manage existing domestic natural gas and oil production in a manner that’s consistent with environmental stewardship and a lower-carbon energy future. We continue to aggressively pursue this mission each and every day, and 2023 was no different. From closing the Tanos II acquisition – which increased our footprint in the Central Region and aligned with our stewardship and sustainability commitments – to ending the year with dual-listing on the New York Stock Exchange, 2023 was a year focused on execution against our core business objectives. Through our focused commitment to responsible asset management, we continue to drive methane intensities downward, while returning wells to production and gaining operational efficiencies. Compared to a 2020 baseline, upstream methane intensity has fallen over 50%, achieving our 2030 goal meaningfully ahead of schedule, and we are continuing to take aggressive steps to optimize environmental performance across our operating areas. By viewing asset retirement as a business opportunity, Diversified’s Next LVL Energy subsidiary is the largest well retirement company in Appalachia. Our focus on asset retirement stands out, with our dedicated teams responsibly retiring 404 wells in 2023 alone, as no other company is addressing state orphaned and end-of-life wells head-on like we are. This focus on sustainability principles has been validated on the domestic and global stage, with sustained Gold standard designations from the United Nation’s Oil and Gas Methane Partnership 2.0 (second year), attainment of the second-highest MSCI ESG “AA” rating, and multiple sustainability awards, to name a few. Last year’s sustainability report detailing our proactive approach took home the ESG Report of the Year by the international ESG Awards 2023 for speaking to “both head and heart,” while also receiving the top category nomination from IR Magazine. I am proud to see the hard work of our employees recognized as industry leaders time and again. We also continue to expand Diversified’s community-giving culture in the communities where we live and work, and we’re privileged to strengthen our corporate commitments to employees. We fully recognize none of this progress would be possible without our 1,600+ diligent team who work every day to ensure families across the United States have safe, clean, and reliable energy resources. | In the year ahead, we are taking a renewed focus on the values on which Diversified was founded: investing in strategic, aligned acquisitions that scale our model and deliver greater operational efficiencies, taking proactive steps to ensure the sustainability of assets, keeping costs low and de-leveraging the balance sheet – all while returning value to shareholders.Diversified has set in motion its “Focus Five” in order to demonstrate meaningful expansion of free cash flow generation while growing the company in a disciplined manner. That plan consists of the following core objectives:—Optimized cash flow generation—Cost structure optimization—Financial and operational flexibility—Sustainability innovation —Scale through accretive growthI believe these principles will help differentiate the Company among its peers in unlocking corporate value throughout 2024 and into the future.The Company has undertaken a reassessment of its capital allocation strategy to weigh the intrinsic value of the current share price level against the historical practice of returning capital through dividends. The Board and executive management team have jointly evaluated a number of potential scenarios to align the dividend level with expected future capital allocation needs, peer trends, current commodity prices and current equity market dynamics.The result of this assessment is the Board’s realignment of capital allocation and is designed to best position the Company to create long-term shareholder value through the proper combination of:—Systematic debt reduction—Fixed per-share dividend —Strategic share repurchases —Accretive strategic acquisitionsWe are proud to be part of the solution to the broader challenge of existing energy infrastructure and to do our part in driving our country’s energy, climate, and economic security – and we couldn’t do it without our OneDEC team. Robert R. (“Rusty”) Hutson, Jr.Chief Executive OfficerMarch 19, 2024 |
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Diversified is the Right
Company at the Right
Time to responsibly
manage existing
domestic natural gas
and oil production in a
manner that’s
consistent with
environmental
stewardship and a
lower-carbon energy
future.
“
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