Diversified Energy : Report FY 2023

Our Core Values

We CARE for each other, our communities, our industry and our country!

COMMITMENT

• Seek opportunities for continuous learning and improvement.
• Serve and support our teams and communities with passion and enthusiasm.

ACCOUNTABILITY

• Act with personal and business integrity.

RESPECT

• Value the dignity and worth of all individuals.
• Respect environmental stewardship as we make business decisions.

EXCELLENCE

• Commit to excellence in our performance.
• Exhibit courage of convictions, challenge the status quo and strive to create value.

Strategic Report

• Chairman's and Chief Executive's Statement
  8 A Differentiated Business Model
  10 Geographic Operating Areas
  12 Strategy
  17 Key Performance Indicators
  20 Sustainability Review
  57 Financial Review
  75 Risk Management Framework
  80 Viability and Going Concern

Corporate Governance

1. The Chairman's Governance Statement

1. Board of Directors

1. Directors' Report

1. The Nomination &Governance Committee's Report

1. The Audit &Risk Committee's Report

1. The Remuneration Committee's Report

1. Remuneration at a Glance

130 The Sustainability &Safety Committee's Report

Group Financial Statements

134 Independent Auditors' Report to the Members of Diversified Energy Company PLC

1. Consolidated Statement of Comprehensive Income
2. Consolidated Statement of Financial Position

• Consolidated Statement of Changes in Equity
  146 Consolidated Statement of Cash Flows
  147 Notes to the Group Financial Statements

Company Financial Statements

1. Company Statement of Financial Position
2. Company Statement of Changes in Equity
3. Notes to the Company Financial Statements

Additional Information (Unaudited)

1. Payments to Governments Report 2023

1. Alternative Performance Measures

1. Officers and Professional Advisors
2. Glossary of Terms

Key Achievements

Accretive Growth Investment in the Tanos II Central Region acquisition totaled $262 million and bolstered average daily production by 8%.

Prioritizing Sustainability Realized 33% year-over-year reduction in Scope 1 methane intensity, achieving our 2030 goal of cumulative 50% reduction in Scope 1 methane intensity (from 2020 baseline) and driven largely by our focused and continual emissions detection, measurement and mitigation programs in both our Appalachia and Central regions.

Asset Monetization Unlocked value on non-core assets through the sale of undeveloped acreage and non-operated well interests for total consideration of $66 million.

Financing

Executed the sale of certain producing assets in Appalachia to a special purpose vehicle "SPV", generating proceeds of approximately $192 million through placement of an asset-backed securitization at the SPV, including the sale of an 80% equity interest in the SPV for $30 million.

U.S. Listing

Commenced trading on the New York Stock Exchange under the "DEC" ticker in December 2023, expanding access to U.S. investors and improving trading liquidity.

Delivering Shareholder Value Share buybacks and distributed dividends represent $179 million in return of capital to shareholders.

Key Facts

PRODUCTION MIXPRODUCTION

PV-10 VALUE OF RESERVES MIDSTREAM SYSTEM

$3.2 ~17,700

billion(a)miles

3,849,946

MMcfe

"Together with our resilient business model, we have been able to deliver strong results which have benefited all stakeholders.

On behalf of the Board of Directors, I am pleased to share our financial and operational results that reflect the hard work, dedication, and focus of the entire Diversified team. Their consistent execution of our strategy and management initiatives has driven another year of strong environmental, financial, and operational performance.

Throughout 2023, we continued to focus on cash flow generation, capital discipline, and balance sheet management. This, together with our resilient business model, means we have been able to deliver strong results which have benefited all stakeholders.

In addition, we are proud of the part we are playing in responsibly providing the energy needed for our communities and country, as well as meeting growing demand beyond the U.S.

Since 2017, Diversified's demonstrated track record has delivered more than $800 million in returns to the Group's stockholders including approximately $700 million in cash dividends paid and declared, along with approximately $110 million in share repurchases.

The Board's dedication to shareholder returns remains an absolute priority. We continuously refine the capital allocation framework in order to balance debt reduction, sustainable fixed dividends, strategic share repurchases and accretive acquisitions. We are proposing a final fourth quarter 2023 dividend of $0.29 which allows us to focus our cash flows on what we believe are the highest and best uses of capital. We are confident that this new level will be sustainable, and will also allow for continued debt reduction, more flexibility for alternative capital returns, and for funding future growth.

We believe that our share price has been significantly undervalued for some while and has been affected by the structural de- equitization of the UK share market. We have, therefore, also authorized a share buyback program, which we believe will be an effective use of our capital and will further increase total shareholder returns.

Part of our business model and strategy revolves around the continued addition of growth opportunities. We identified a listing on the New York Stock Exchange, in addition to the London listing, as an opportunity that could help to add significant value and were pleased to deliver on that key milestone this year. We view the NYSE listing as a great opportunity to expand access to U.S. investors and improve trading liquidity. We continue to evaluate opportunities to grow and to increasingly make Diversified the "Right Company at the Right Time."

Another important part of our focused strategy is to create value through sustainability and stewardship. Over the past year, we have made significant progress with our methane emissions program, reducing emissions by over 33% from 2022 and achieving our 2030 goal meaningfully ahead of schedule. We are proud that we received recognition from the United Nations' Oil & Gas Methane Partnership 2.0 (OGMP), being awarded the Gold rating for the second year. Our initiatives related to methane emission reductions are of paramount importance, and it gives us great confidence to see this recognized by international bodies.

Operationally, we conducted over 246,000 leak detection surveys using industry-leading and proven detection equipment, and attaining a zero emissions rate of approximately 98%, proving the positive impact of our actions to eliminate methane leaks. Next LVL Energy, our asset retirement business, has continued to grow and contribute significantly to safe and efficient well retirements, retiring a total of 404 wells. This achievement included retiring a total of 222 Diversified wells in 2023, significantly exceeding state agreements. Additionally, our partnership with states on their orphan well programs resulted in 148 retired wells. We are immensely proud of the material investments we have made to lower our methane intensity, and to safely retire wells, and we remain focused on delivering continuous improvement.

The Board and its Committees continue to operate effectively and are active in both supporting and challenging strategic discussions. There is an exceptional depth of knowledge and diversity of thinking. We again conducted a Board Performance Review during 2023 and will continue to ensure that we comply with all governance guidelines.

As we look ahead to 2024 and beyond, I would like to recognize the quality of the team we have at Diversified, across the entire Group. I am very grateful for their work and look forward to future successes as a company in the years to come. In particular, I would like to thank the Executive Team, led by Rusty Hutson, Jr., who navigated the team through a year that has seen its share of broader challenges, notably an unfavorable commodity price environment. I also wish to express gratitude to our shareholders, lenders, and other stakeholders for their trust in our commitment to deliver long-term sustainable value and their support whilst we provide essential energy security and continue to care for our communities.

David E. Johnson

Chairman of the Board

March 19, 2024

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 growth

I 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 acquisitions

We 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 Officer

March 19, 2024

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.

• ACQUIRE

We maintain a disciplined approach to evaluating opportunities to ensure that we only pursue those that possess a consistent asset profile. We target existing long-life, stable assets with synergistic opportunities that produce predictable and stable cash flows, are value accretive, margin enhancing and strategically complementary.

• OPTIMIZE

The primarily mature nature of the assets we acquire provides us with a portfolio of low-cost optimization opportunities. These optimization activities, applied through our internally developed SAM program, are strategically important as they aid in offsetting natural production declines, creating expense efficiency and reducing our emissions.

• PRODUCE

Our culture makes the difference as our team of industry veterans strive to efficiently produce as many units as possible in a safe and environmentally responsible manner, aligning both environmental and financial best interests.

4 TRANSPORT

We seek to acquire midstream systems into which we are a large producer and more fully integrate those assets into our upstream portfolio to provide immediate and long-term synergies.

• RETIRE

We embrace our commitment to be a responsible operator of existing assets. With safety and environmental stewardship as top priorities, we design our asset retirement program to permanently retire wells that have reached the end of their producing lives. During 2022, we made investments that allowed us to meaningfully expand our asset retirement capabilities through a series of acquisitions that we believe have provided us with the operational capacity to be a leader in asset retirement.

DAILY OPERATING PRIORITIES

Safety

No compromises. Ensuring the care and well-being of our employees, our families, our partners and communities is our top priority.

Production

Every unit counts. Ensuring that every unit we safely produce provides affordable and reliable energy to our communities and generates value for our shareholders.

Efficiency

Every dollar counts. Ensuring every dollar we spend protects our employees and communities and grows the investment of our shareholders.

Enjoyment

Have fun delivering great results. Ensuring our company is an attractive place to work, encouraging innovation and celebrating our employees' accomplishments.

STRATEGY

Acquire long-life stable assets

Operate our assets in a safe, efficient and responsible manner

Generate reliable free cash flow

Retire assets safely and responsibly