Bringing Down Breakeven Costs

“How to Survive and Thrive?”

DUG Conference Mike Eberhard, P.E.Denver, CO VP of CompletionsMarch 10, 2016

About Synergy

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Key Statistics

Stock Price (03/04/16) $7.46

52 Week High/Low $13.25-$5.05

Shares Outstanding Diluted* ~125MM

Public Float ~111 MM

Avg. Daily Vol. (3 month) 2.4 MM

Market Capitalization ~$925 MM

Insider & Employee Holdings, est. ~8%

Fiscal Year End December 31

Cash & Equivalents (11/30/15 Pro-forma*) ~$92 MM

Outstanding Debt (11/30/15 Pro-forma*) $0 MM

Borrowing Base Availability (as of 1/28/16) $145 MM

This presentation contains forward-looking statements, within the meaning of thePrivate Securities Litigation Reform Act of 1995. The use of words such as "believes,""expects," "anticipates," "intends," "plans," "estimates," "should," "likely" or similarexpressions, indicates a forward-looking statement. These statements are subject torisks and uncertainties and are based on the beliefs and assumptions of management,and information currently available to management. The actual results could differmaterially from a conclusion, forecast or projection in the forward-looking information.Certain material factors or assumptions were applied in drawing a conclusion or makinga forecast or projection as reflected in the forward-looking information. Theidentification in this presentation of factors that may affect the company’s futureperformance and the accuracy of forward-looking statements is meant to be illustrativeand by no means exhaustive.

All forward-looking statements should be evaluated with the understanding of theirinherent uncertainty. Factors that could cause the company’s actual results to differmaterially from those expressed or implied by forward-looking statements include, butare not limited to: the success of the company’s exploration and development efforts;the price of oil and gas; the worldwide economic situation; changes in interest rates orinflation; the ability of the company to transport gas; willingness and ability of thirdparties to honor their contractual commitments; the company’s ability to raiseadditional capital, as it may be affected by current conditions in the stock market andcompetition in the oil and gas industry for risk capital; the company’s capital costs,which may be affected by delays or cost overruns; costs of production; environmentaland other regulations, as the same presently exist or may later be amended; thecompany’s ability to identify, finance and integrate any future acquisitions; and thevolatility of the company’s stock price; and other factors described in the company’sfilings with the SEC, which are incorporated herein by reference. The companyundertakes no obligation to update any forward‐looking statements in order to reflectany event or circumstance occurring after the date of this presentation or currentlyunknown facts or conditions. Resource estimates and estimates of non‐proved reservesinclude potentially recoverable quantities that are subject to substantially greater riskthan proved reserves.

*Pro-forma for Equity Offering closed 1/27/16

Sources: Company estimates. In USD

Wattenberg Focus

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Synergy’s Acreage Position in the Greater Wattenberg Area

Synergy Leasehold

Focus on Core Wattenberg Area

~ 41,000 Net Acres

NE Wattenberg Extension Area

~ 52,000 Net Acres

Note: Offset operator acreage positions reflect approximations, are not meant to depict entire leasehold, and may contain inaccuracies.

Core Wattenberg Operated HZ Wells

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• Focus is shifting to longer length laterals

• DUC inventory Weideman Pad – 4 LL wells and 4 SL wells Vista Pad – 10 SL wells

• Current 2016 drilling program Fagerberg Pad (14 ML wells) Evans Pad (22 LL wells) Williams Pad (9 ML wells)

4

Drilled Uncompleted

Weideman Pad

Vista Pad

10 - 15%

~50%

>60%

2014 - 2015 2016 Long Term Plan

Estimated % of Operated Longer Lateral Wells Synergy Land LegendLeaseholdOperated pads w/ producing wells

Future Drilling Sites

Evans Pad

Williams Pad

Fagerberg Pad

Rapidly Growing Reserves and Production

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4,290

8,725

10,540

BO

EPD

Daily Net Production

FY 2014 FY 2015 Q1 FY 16

0

10,000

20,000

30,000

40,000

50,000

60,000

Re

serv

es

MM

Bo

ePUD PDNP PDP

* Proved Reserves as of 8/31/2015 (Ryder Scott 3rd Party Reserve Engineers)

32 MMBoe

57 MMBoe *

8/31/2014 8/31/2015

Recent Changes at Synergy

“…to build a successful organization and team you must get the right people on the bus...” Jim Collins, Good to Great

• New management team

• Development of in-house technical expertise Communication across disciplines Aligned goals Better evaluation of prospects

• Relocate corporate headquarters to Denver

• Change fiscal year end from Aug 31 to Dec 31 Aligned with peers for better comparison

• Be the operator of choice in urban areas

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“We cannot drill our way to lower prices at the pump” US Senate Democratic newsletter; June 18, 2008

“…and you know we can’t just drill our way to lower gas prices.” Barack Obama Feb 23, 2012

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2/86

1/91 3/98 9/0110/08

1/82

$31.80 – 11.60 $50

$133.93

“We cannot drill our way to lower prices at the pump” US Senate Democratic newsletter; June 18, 2008

“…and you know we can’t just drill our way to lower gas prices.” Barack Obama Feb 23, 2012

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2/86

1/91 3/98 9/0110/08

1/82

$31.80 – 11.60 $50

$133.93

How Do We Survive?

• Maintain a strong balance sheet

• Look for opportunities that make sense

• Emphasis on base production

• Evaluate D&C costs vs. well performance

• High grade vendors

• Look across the fence to learn

• Access to higher cost technology

• Continue to Innovate

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Capital Preservation

• Maintain a strong balance sheet Evaluate all expenses for want vs. need

Detailed portfolio projects economicso Incorporate lease hold requirements, pipeline commitments, etc.

Continuous evaluation of vendor pricing

Do not get into big drilling commitments, lease hold commitments

• Growth through M&A Use equity instead of debt

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Growth Through M&A

• Core up acreage Allows for more medium to long laterals

o Better economics

o Fewer surface locations

Provides more surface location options

• Be realistic about well performance

• Don’t “fall in love with your deal” Be willing to walk away

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920’

SRL LRLMRL

Base Production

• Company pumpers for horizontal wells Compensation based on performance

• Track base production - KPI Communicate to field Analysis of downtime causes

• Evaluate cost of gas lift May cost more than the increased oil production

• Constant monitoring of plunger cycles for optimization Catch wells before problems occur (loading up and swabbing, fishing)

• 24hr monitoring for high production pads in high line pressure areas Can make 250 to 500 BOEPD difference in production

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Evaluate D&C Costs vs Well Performance

• What made sense at $100 oil may not work at $30 oil Need tangible results from spend

• Re-evaluate completion designs that may not be optimum Reduced cost may offset the lower production

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10% reduction in well performance is offset by lower completion costs

D&C 2,650$ 2,360$ 4,350$ 3,700$

Delta Prod 0% -10% 0% -10%

IRR 43% 43% 42% 46%

NPV ($M) 2,605$ 2,352$ 4,507$ 4,253$

MTP (mo) 26 26 27 25

Niobrara Wells - Current Strip

TC I - Short TC I - Long

High Grade Vendors

Relationships with past vendors are important

but…

Opportunity to improve where needed

Safety is still number oneo Vendors making cuts to keep margins

Improve on efficiency to reduce cycle times and costo Reduce NPT, upgrade equipment, experienced personnel

Sustainability of vendor base is important for long term o Can’t keep all vendors viable

Price

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Look Across the Fence

• Learn from other operators Available time to do a deep dive into offset well performance

• Time to go back and look at what you did Why is this well so good/bad

What can you learn from trouble job wells

• Continue development, training, and networking Opportunity to look up from what

you were doing

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Curtesy of “Home Improvement” - ABC

Access to Higher Cost Technology

• Service providers still want to prove up technology Shared risk/reward

• Fixed pricing for higher risk services

• Willingness to provide extra services for work Previously upsold services

• Easier access to technology groups

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Continue to Innovate

• Not all innovations result in reducing cost Improve EUR

• Process improvement Time to look at operations in more detail

Efficiency savings last even when prices increase

• Integrated project evaluation Integrating multiple disciplines

Well spacing, well placement based on geophysics

Engineered vs spreadsheet designs

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Issues

• Pipelines continue to be a problem Capacity, line pressure, oxygen

• Regulations continue to add cost Air – OOOO has added several layers to operations

Noise

• Price differential

• State and local regulatory changes Setbacks, MOU’s, Ballot Initiatives

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