Corporate
Sustainability
Report2023

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TABLE OF CONTENTS

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03

12

Introduction

Environment

28
Social41

51

GovernanceAppendix

1

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IN T R O D U C T I O N

04A Letter from Our CEO

06

About Civitas

08

Our Approach to Sustainability

09

ESG Materiality Assessment

102022 Report Highlights

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A Letter from Our CEO
Last year, in our inaugural sustainability report, we set ambitious aspirations for Civitas

Resources — this year, I am pleased to report that we’ve taken a number of actions to fulfill
our commitments. That is why I am pleased to present our second annual Sustainability
Report, which details the actions we’ve taken in the last year to help us meet our goals.

Over the past year, we made significant efforts to understand our current performance ineach of these pillars so that we can invest in the right areas.

M. CHRIS DOYLE
President and CEO

The publication of this report coincides with Civitas’ evolution from being Colorado’s largest
pure-play operator to extending our asset base into the Midland and Delaware Basins of
the Permian Basin. Civitas aspires to bring the same level of rigor in measurement anddisclosure to these new assets as we share now with this report of our 2022 performance.

UNDERSTANDING OUR FOOTPRINT
Given our status as Colorado’s first carbon neutral oil and gas producer withrespect to scopes 1 and 2 greenhouse gas (GHG) emissions, we understandthe importance of accounting for our greenhouse gas footprint in the mostaccurate and actionable manner possible. Over the past year, we haveinvested in creating continuity around data sourcing for our operations andin the solidification of our calculation methodology. Where processes havevaried, we have implemented uniform standards that exceed the EPA’s
most stringent regulatory interpretations, proactively setting Civitas up for
success in the face of an ever changing regulatory environment.
In addition to better data sourcing, we have also invested in better data
management capabilities. Civitas’ compliance tracking system integrates
into our environmental, social, and governance (ESG) metrics dashboard,
allowing for near-real-time accounting of our scopes 1 and 2 footprint. Inline with our ambition to continue to reduce our operating footprint, thistool allows us to better understand where to focus our emissions reduction
efforts on a more granular basis, and to set better, more meaningful targets.
During 2022, Civitas identified natural gas pneumatic devices as one of its
largest single-source contributors to company scope 1 GHG emissions.

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We have since implemented a company-wide retrofit to compressed air,scheduled for completion by the end of 2023. This action alone has the potential
to reduce the company’s absolute scope 1 CO2e emissions by approximately 33
percent relative to 2021, allowing Civitas to take an important step to reduce
scope 1 emissions by 50 percent by 2027 against a 2021 baseline.

SUPPORTING OUR PEOPLE & COMMUNITIESFoundational to Civitas’ success and ability to achieve our aspirations is oursocial license to operate, and this includes ensuring our team members andcontractors have a healthy and safe working environment. In 2022, we continued
to make progress on improving personal safety, including the consolidation ofhealth and safety practices to help achieve consistent application of Civitas’high standards.
We made the shift from aspirational to measurable, remaining active in ourcommunities throughout 2022, and officially launching our Civitas Community
Foundation that provides project grants and scholarships to communities where
we operate. The Foundation’s inaugural event partnered with Project Warm toprovide a warm winter coat to each of the 10,000 kids attending low-income
schools in our operating areas. We have continued our investment in local
emergency response training and preparedness for Front Range firefighters as
well, making sure that our focus on safety extends beyond our employees andcontractors. We are excited to expand on these partnerships in the years ahead
to continue supporting our surrounding neighbors and communities.

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M. CHRIS DOYLE
President and CEO

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STRENGTHENING OUR CORPORATE PRACTICES AND OVERSIGHTLOOKING AHEAD

Our leadership team embraces the belief that strong corporate governanceand continuous improvement in our practices are key to the long-term
health of our business and its people. Over the past year, we have published
Human Rights and Biodiversity policies, reinforcing our commitment toacting with integrity — both in our communities and for the ecosystems
where we work. Recognizing our commitment to diversity, we have
improved female and racial/ethnic representation on our Board with our
new 2023 cohort, in line with the objectives of our ESG framework. We
are building partnerships with minority-focused professional organizations
as a means for creating a quality pipeline of diverse talent throughout
the organization. During 2022, we initiated the Employee Engagement
Committee, with a Diversity, Equity, and Inclusion (DEI) subcommittee added
to engage our employees and learn from their varying perspectives. It’s
our goal to develop additional employee resource groups based on a firm
commitment to attract, retain, and develop top talent in a purpose-driven
work environment.

Building upon the success we have achieved over the past year, I’m
optimistic that 2023 will be another year of significant progress for Civitas.
We continue to drive meaningful change on our path to delivering on theaspirations set in our inaugural report and have already implemented anumber of changes to-date that we look forward to sharing in the months
ahead. I speak for all of Civitas’ team members when I say thank you foryour continued interest in this journey — our future is bright, and I lookforward to all that we will accomplish together.

CARRIE HUDAK
Chairman of the ESG Committee

Civitas differentiates itself in the oil and gas industry, not just in our drive to operate
in harmony with our communities or our desire to improve environmental protections
each year – these practices and aspirations are shared by many of our industry peers.
Civitas’ commitment to delivering its net-neutral commitment and investing capital tomeaningfully eliminate emissions from operations makes it truly unique. As an industry,
we are immersed in emerging technologies and operating in a time of great change, but
Civitas is not waiting on perfect solutions. We are tackling the challenges of the energy
transition head-on by offsetting our climate impacts and creating incentives within ourorganization to operate in a way that demonstrates leadership in the environmental,social and governance aspects of our business each day.
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ABOUT CIVITAS
Civitas Resources was founded in November 2021 with the consolidation of

Bonanza Creek Energy, Crestone Peak Resources, Extraction Oil and Gas, and
HighPoint Resources, which established Civitas as the largest pure-playenergy producer in Colorado’s Denver — Julesburg Basin (DJ Basin). In March
2022, the company acquired Bison Oil & Gas, further expanding its footprintin the region. Today, Civitas operates approximately 525,900 net acres with aproduction base of about 170,000 barrels of oil equivalent per day.1

The company pursues compelling economic returns and cash flow,
delivering best-in-class cost leadership and capital efficiency. The
company’s technical staff of geologists, petroleum engineers, andgeophysicists have decades of industry experience and are experts inhorizontal drilling and fracture stimulation in the DJ Basin.2¹ Civitas 2022 10-K
Civitas Resources announced the signing of two definitive agreements to acquire oil producing
assets in the Midland and Delaware Basins of west Texas and New Mexico in June of 2023. Bothtransactions are subject to customary terms and conditions and are expected to close in the third
quarter of 2023 with effective dates of July 1, 2023.

2

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Sustainable Value Creation
Civitas’ main pillars of focus are(1) generating free cash flow, (2)maintaining a premier balance sheet, (3)returning cash to shareholders, and (4)demonstrating ESG leadership within
the industry. Civitas’ key stakeholders— investors, regulators, neighbors, andemployees — demand excellence insustainability to ensure the company
successfully navigates the transition to a
low-carbon economy.
Civitas sold a portion of its natural gas at a premium price due to its
certification as third-party certified Responsibly Sourced Gas (RSG),
highlighting how sustainability can increase the value of revenue
streams. The world is expected to depend on oil and natural gas tomeet its energy needs through decades of energy transition. Civitas
anticipates that customers will increasingly seek out differentiatedoil and gas resources that have been responsibly produced in ademonstrable manner.

Civitas embraces that all key
stakeholders — investors, regulators,
neighbors, and employees — demand
excellence in sustainability.

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CIVITAS ESG FRAMEWORKENVIRONMENTSOCIAL

Emissions Intensity Reductions
Company aims to achieve a 2.5% fixed annual
scope 1 emissions intensity reduction against the2019 EPA reporting baseline.

TRIR
Company aims to maintaina Total Recordable Incident
Rate below 0.25 work related
injuries per 100 full-timeworkers inclusive of employees
and contractors in a one-year
period.

Absolute Scope 1 Emissions Reduction
Company aims to achieve a 50% reduction ofabsolute scope 1 GHG emissions by 2027 against
the 2021 EPA reporting baseline.
Carbon Neutrality
Company aims to maintain scope 1 and scope 2
carbon neutrality, offsetting residual scope 1 and 2
GHG emissions with certified carbon credits fromthe four largest and in the Company’s estimation,
most credible registries (VERRA, GS, ACR, CAR)
and for scope 2 emissions, Green-e® Certified
renewable energy certificates.

GOVERNANCE
Board Diversity
Company aims to maintaina Board of Directors gendercomposition of at least 30%
female.

Civitas’ ESG program is designed to help the company manage key risks related to health and safety,
reputation, regulatory, legal, social, or local impacts, which helps the company to avoid harm andresponsibly manage capital. This report seeks to align with Sustainability Accounting Standards Board(SASB), American Exploration and Production Council (AXPC), and Task on Climate-related Financial
Disclosures (TCFD) disclosure frameworks and standards to provide insights on how climate change
has the potential to impact the company’s business model and how corporate performance compares
to industry-specific peers and global climate change objectives.
The company believes robust ESG-focused operating practices provide a competitive advantage
as federal regulators nationalize certain environmental and disclosure obligations and as operatorsin other areas work to come into compliance. The Greenhouse Gas Protocol will aid Civitas inproactively preparing for climate disclosure requirements proposed by the U.S. Securities andExchange Commission. Civitas understands that all key stakeholders — investors, regulators,
neighbors, and employees — demand excellence in sustainability.

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OUR APPROACH TOSUSTAINABILITYABOUT THIS REPORT
Civitas’ 2023 report discloses the company’s 2022 performance. This
report is intended to update key stakeholders on the company’s vision,
mission, and values, as well as operational metrics central to ESG factors
and progress toward the company’s defined objectives. In the interest of
maximizing transparency as a best practice, this report references andbuilds on the different sustainability and climate disclosure standards
and frameworks: the Sustainability Accounting Standards Board (SASB),
the Task Force on Climate-related Financial Disclosures (TCFD), and theAmerican Exploration and Production Council (AXPC). In addition to thepoint-in-time disclosures provided in reference to these frameworks in the
appendix of this report, supplemental data that becomes available after
the date of publication of this report may, by Civitas’ discretion, from time
to time be made accessible on the Civitas website. However, Civitas takes
no duty to update this information on a go-forward basis. The company
plans to annually evaluate the evolving voluntary disclosure and regulatory
landscape, along with shareholder expectations, to determine futurereporting best practices. Unless explicitly stated otherwise, the informationin this report is current as of March 31, 2023.

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GOVERNANCE OF SUSTAINABILITY
The Board of Directors provides the highest level of oversight for Civitas Resources andits ESG program. The Board’s structure includes an ESG Committee, which oversees andsupports the Company’s environmental, health, safety, regulatory, and compliance policies,
programs, and initiatives, as well at the Company’s commitment to sustainability. The ESG
Committee meets at least quarterly and has the authority to raise business critical ESG issues
in the intervening time.
The Chief Sustainability Officer (CSO) leads the company’s ESG program within the executive
management team and is accountable for strategy and execution of ESG objectives. The CSO
reports on progress, risks, and opportunities to the executive management team on a weekly
basis and regularly interacts with the Board of Directors’ ESG Committee chair and otherboard members to ensure appropriate Board oversight and input on the company’s
ESG program.
Civitas uses established external assessment frameworks to help identify, understand, andprevent particular potential ESG-related risks. The Company’s commitment to rigorous
evaluation and mitigation of evolving issues have led Civitas to annually review certain
potential risks related to natural disasters, pandemics, legislation, social, political, andregulatory impacts, as well as competitive or technological displacements. Civitas works totrack and monitor ESG-related risks to assess potential impacts.

Board of Directors

Board-level Committees Composedof Non-employee Directors

Audit
Committee

Nominating &GovernanceCommittee

Compensation
Committee

ESG
Committee
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ESG MATERIALITYASSESSMENT

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3
The following provides an overview of the assessment’s findings:

Civitas believes that it derives business value from its focus on safely and responsibly developing
framework of sustainability leadership. This is the company’s DNA.

S USTAI N AB ILIT Y
L E ADE R SHIPSTAKEH OL DER
ALIGNM EN T

SA F EOP ER ATI ON S

Civitas performed a materiality assessment and published a consolidated ESG
scorecard in December 2021 to establish the foundation of its ESG program. An
ESG materiality assessment is a widely used process designed to identify risks
and opportunities that could have the most impact on a business; operationally,financially, reputationally, regulatorily, and otherwise. The initial assessment prioritizedinsights from executive leadership and cross-functional stakeholders throughout theorganization.
The assessment was conducted by an independent, third-party ESG consulting firm
to ensure confidentiality and impartiality throughout the process. The consulting
firm developed a list of topics relating to the oil and gas exploration and productionindustry and created a survey for cross-functional experts to complete.
3
In this report, Civitas is not using such terms “material” or “materiality” as they are used under the securities orother laws of the U.S. or any other jurisdiction, or as they are used in the context of financial statements and financial
reporting. Materiality, for the purposes of this document should not, therefore, be read as equating to any use of theword in other Civitas reporting or filings.

Importance to Cross-Functional Employees

critical energy resources in a way that is aligned with its shareholders and stakeholders and within a
GHG
Emissions

Business Ethics & Transparency
Talent Retention

Water Use

Executive Compensation
Mental Health

Biodiversity
Contractor Engagement
Energy Management

Human Rights

Waste

NEGLIGIBLE

Hazardous
Materials

MODERATE

Asset
Integrity

Air Emissions
Government Relations
Health & Safety

Capex
Board
Composition
Employee
WelfareCommunity Relations

Spill Prevention

Diversity & Inclusion

Emergency Response& Preparedness
Net-Zero

Cyber Security & Privacy

Landowners Relations
Social Giving / Investment

SIGNIFICANT

MAJOR

Importance to Executive Leadership
Environmental Topics

Social Topics

Governance Topics

Civitas intends to re-evaluate this assessment periodically to help ensure it remainsaligned to important market and stakeholder expectations.
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TARGET TO REDUCE ABSOLUTE SCOPE 1 GHG EMISSIONS 50% FROM 2021
BASELINE BY 2027, TOGETHER WITH AN ANNUAL 2.5% FIXED SCOPE 1 GHG
EMISSIONS INTENSITY REDUCTION AGAINST 2019 EPA REPORTED BASELINEON A 10-YR AVERAGE THROUGH 2030.

2022 Report Highlights

CIVITAS IS COLORADO’SFIRST CARBON NEUTRALOIL AND NATURAL GAS

Zero routine flaring,achieved January 2022

Electrified drilling andcompletions equipment,
used where feasible andappropriate

Comprehensive natural
gas pneumatic retrofit;
expected completionby end of 2023

PRODUCER ON A SCOPE 1
AND SCOPE 2 BASIS.

4

4
We believe Civitas is Colorado’s first carbon neutral operator on both a
Scope 1 and Scope 2 basis, meaning that Civitas is at a neutral balance
between emitting and removing carbon from the atmosphere.

Leak detection &repairCONTINUOUS
METHANE
MONITORING
AT MORE THAN
90 SITES

Audio/visual/olfactoryinspections

Pipeline transportation of
produced oil and water,where feasible

Emissions-controlled
first-production
equipment

TOTAL
RECORDABLEINCIDENT RATETARGET: LESS
THAN 0.25

NEW CROSS-SECTOR PARTNERSHIPSTO DEVELOP A ROBUST PIPELINE OF
DIVERSE TALENT.
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2022 Report
Highlights Continued

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Governance
»
»
»
»
»

Board compensation chiefly in stock
Named Executive Officer (NEO) compensation alignedwith absolute shareholder return targets
Dedicated ESG Board Committee
Annual Board Elections
Updated bylaws that create a majority voting standard
and proxy access for improved shareholder nominations

Civitas Community
Foundation
A 401(c)(3) providing grants
and scholarships in nearby
communities with special
dispensation to thoselocated closest to company
operations

Humanitarian Relief

Orphan Well Plugging

In addition to numerous local
giving campaigns, Civitas provided»$10 million for Ukrainian war
relief purposes in 2022»

51 Appendix

Biodiversity
Civitas’ Wildlife Program
includes a range of BestManagement Practices(BMPs) and new technologies
implemented as appropriate
and aimed at reducing
ecological impacts, including
environmental site assessments,
on-site third-party biologists,sound wall installations, andextended-reach horizontal
drilling

Civitas committed to voluntarily

plug 41 wells orphaned by previous operators
located in and around its operating areas on the
Denver Front Range
This commitment will eliminate 10% of Colorado’s
orphan wells known as of January 1, 2022

MORE THAN 90 LOCATIONS EQUIPPEDWITH MORE THAN 100 24-7 REAL-TIME
AIR MONITORING AND METHANE
DETECTION STATIONS

31 WELLS CERTIFIED BY A THIRD-PARTYAS PRODUCING RESPONSIBLY SOURCED
GAS WITH SIGNIFICANT PROGRAM EXPANSIONPLANNED FOR 2023
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29

E N V IR O N M E N T

13Managing Environmental Risks & Opportunities

16

Greenhouse Gas Emissions & Air Quality

19

Emissions Monitoring & Management

20

Energy Management & Renewables

22

Water Management

23

Spill Prevention & Asset Management

24

Biodiversity & Ecosystems

27

Waste Management

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42

52
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MANAGING ENVIRONMENTALRISKS & OPPORTUNITIESCivitas’ commitment to sustainability leadership in the oil and gas industry exists at the nexus of a

dedication to environmental stewardship and the company’s unique status as Colorado’s first carbon

neutral oil and gas producer with respect to scope 1 and 2 GHG emissions. Civitas was carbon neutral
upon company formation in 2021 and has maintained carbon neutrality through a two-fold approachto 1) reduce and eliminate operational emissions as a foremost priority, and only after that rigorous
effort has taken place, 2) offset residual scope 1 and 2 emissions annually.

In 2022, Civitas strengthened and improved its scopes 1 and 2 GHG emissions
intensity monitoring, developing detailed planning to meet impending GHG
intensity targets — especially methane intensity — required by Colorado andfederal regulations. These actions are informed by Civitas’ firm understanding of the
expectations set by regulating agencies and the company’s commitment to proactive
and continuous compliance.

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CARBON OFFSET PORTFOLIO
Civitas seeks to offset residual scope 1 emissions that have not yet been or
cannot be eliminated with certified credits validated and offered through thefour voluntary carbon credit project registries that Civitas considers mostcredible — American Carbon Registry (ACR), Gold Standard, Climate Action
Reserve (CAR), and Verra’s Verified Carbon Standard (VCS) program’s registry.
Civitas intends to continue offsetting scope 2 emissions with Green-e® certified
renewable energy certificates (RECs), providing assurance that the company’s
renewable energy certificates are legitimate, measurable, and only claimed by
one party.5
Civitas’ disciplined investment principles include a dynamic approach to carbon
credit selection over an array of offset project types. The company prioritizes
methane-eliminating projects, high-quality U.S.-centric nature-based offsets withclear additionality, energy efficiency, and international offset projects that haveco-benefits mitigating negative environmental or social impacts. Civitas stays
current with the evolving nature and availability of different offset project types
as it manages its portfolio.

CIVITAS HOLDS ~1.5MM MT-CO2E IN VOLUNTARY CARBON CREDITS[AND RENEWABLE ENERGY CERTIFICATES] AFTER 2022 RETIREMENTS,
HELPING TO ENSURE NEUTRALITY THROUGH AND BEYOND 2023
2%

Civitas persistently seeks out opportunities where engineering design, technology,
and operational procedures can be improved to reduce or permanently eliminate
emissions sources. A comprehensive effort was undertaken in 2022 to establish thefoundation of the corporate emissions profile, consolidating data collection andcalculation methods for consistent and repeatable analysis. This baseline exercise
identified the highest-impact emission reduction projects for technology selection,
workforce resourcing, and budget allocation.

9%

3%

7%

Landfill
Cookstoves

10%

Circulatory
Hydropower

14%

Preservation
54%

Sequestration

67% USAAND 33%
INTERNATIONAL

Energy Efficiency

5

www.green-e.org/long-rec-disclosure

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Civitas’ approach to carbon neutral
operations is guided by three primaryclimate goals:

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3

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Asset optimization
through infrastructure
consolidation

Compressed air
retrofit of natural gas
pneumatic devices

Facilities designed
to manage or control
maintenance emissions

Tankless or closed-loop
production facilities

Plugging of inactive
vertical wells

Monthly LDAR
and routine visualinspections for leakdetection

Continuous ambient
emissions monitoringat new facilities in preproduction and early
production operations

Pipeline transportationof oil where feasible,
reducing truck hauling

Flowback to tanklessfacilities and pipeline
infrastructure

Fuel gas measurement
on engines and engine
upgradesPressurized workover
operations equipment
to decrease venting

Enhanced gas vapor
extraction andemissions controls on
tanks

A 50% reduction of absolute scope 1 GHG
emissions by 2027 from a 2021 baseline
An annual 2.5% fixed reduction of scope 1
GHG emissions intensity from a 2019 baseline6
A commitment to offset all residual scope 1 andscope 2 emissions using certified carbon credits
and renewable energy certificates, respectively7

Civitas’ carbon neutral commitment creates a financial impetus to internallyreduce emissions to mitigate the long-term impact of purchasing voluntarycarbon credits and renewable energy certificates a methodology for
project cost analysis that incorporates value effects, supporting responsible
and impactful spending. Civitas continually assesses innovative emissions
mitigating strategies and technologies for implementation.
6

Time averaged over a 10-year period.

7

From company inception in November 2021.

At various locations
these include

Local sourcing of materials where feasible andappropriate, reducing transportation (e.g., fracsand contracted from a local mine, eliminating
the need for rail transportation)

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Civitas’ legacy companies paved the pathway as early
adopters of emissions management and mitigation
programs including pneumatic retrofits, methane
monitoring technologies, electrification of drilling, andsupplying third-party certified Responsibly Sourced Gas(RSG). Civitas has built upon these efforts to advance its
own emissions reduction program. Increased frequency
and accessibility to GHG data from Civitas’ proprietary
ESG metric dashboard, developed in 2022, has improved
corporate confidence and clarity around its ability to set
and meet operational GHG emissions targets.
Absolute Emissions Reduction Roadmap(mT-CO2e)28 Social

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COST OF CARBON
Cost of carbon calculations are inherently critical to Civitas’ commercial success and its ability to serve
stakeholders with value analyzed emissions reduction projects.
Civitas’ internal cost of carbon remains at $30 per mT-CO2e, calculated using actual project costs and values to
identify the implicit cost of carbon, and then applying a variety of economic, environmental, and social factors todevelop an internal cost of carbon. As the incremental metric ton of carbon emissions becomes more difficult toeliminate, the internal cost of carbon range will likely increase.
The company’s internal cost of carbon is used as part of a strategy to minimize climate-related risks, selectprojects with low-carbon emissions, and prioritize projects with high emissions reduction value. Projects withreturns that are near or below the internal cost of carbon receive priority in the budgeting process. Projects
where the cost of reducing emissions is significantly more per ton than the internal cost of carbon require
additional rigor in analysis, optimization in design, and justification in the duration of service before receiving
approval to proceed. This process helps ensure that climate risk continues to be mitigated as efficiently as
possible within Civitas.

50% 2021 EPA Subpart W CO2e Emissions

Case Study
New Compressor Station

Associated Gas Flaring

Comprehensive Pneumatic Retrofit

Frac Fleet Electrification

Compression Optimization

Venting from natural gas pneumatics is a major
contributor to Civitas’ emissions profile, and assuch the company continues to invest in provenand commercialized technologies to achieve
value-impact emissions reductions. Civitas has
committed $15 million to a comprehensive natural
gas pneumatic retrofit, as a high value emissions
reduction project at $33/mT-CO2e cost of carbon
with significant benefits in methane reduction.
Civitas expects that this project will be complete by
the end of 2023.

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GREENHOUSE GASEMISSIONS & AIR
QUALITY
Civitas made an extensive effort in 2022 to help ensure acomprehensive understanding of the company’s emissions profileand to position itself to achieve its emissions reduction goals

through its ESG Data Management Strategy. Civitas’ data collection
and calculation methods were baselined for continuity and tocreate access to the high-quality data necessary to understandand implement emissions reductions. Civitas’ emissions reduction
targets often help produce results exceeding federal regulatory
requirements, including U.S. EPA standards.

Civitas contracted a field audit to hand-count tens of
thousands of pneumatic devices, an improvement to thefield estimation method utilized by a majority of theirlegacy companies. At a calculated 41% of its absolute
CO2e emissions and 95% of its absolute scope 1 methane
emissions, natural gas pneumatic devices constitute asignificant portion of Civitas’s GHG emissions and area target for meaningful emissions reduction. Civitas’
accelerated plan for comprehensively retrofitting natural
gas-driven pneumatic devices has the potential to reduce

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41 Governancethe company’s annual absolute CO2e scope 1 emissions byapproximately 33% by the end of 2023 relative to 2021,
a significant step towards Civitas’ 50% scope 1 GHG
emissions reduction by 2027 target.

Civitas will remain relentless in its
commitment to reduce emissions.
Civitas’ consolidation of singular processes for data
management among legacy companies relied heavily on
the company’s Environmental Management Information
System (EMIS). This EMIS serves as the system of record
for GHG and air quality data. The EMIS compiles andstores digital forms, metered data streams, calculated
emissions, and physical inventory records. In combination
with environmental management policies and practices,
the EMIS allows Civitas to proactively manage its
environmental footprint at all facilities and supports
overall operational excellence. The EMIS calculatesemissions, monitors emission limits, and tracks permitting
requirements as applicable, sending out alerts andreminders when action is required.
Civitas’ ESG metrics dashboard integrates enterprisewide data from EMIS into a bespoke visualization
tool that provides near-real-time data and improved
information for operational decision making, allowing
the company to review aggregated data far aheadof the traditional annual greenhouse gas reporting
cycle. The ESG dashboard enables a granular progressassessment on emissions reduction projects, and is used
for optimization of the company’s project spend andresidual emissions offset management. This capability
also allows Civitas to proactively prepare for oncoming
regulatory requirements, empower decision making, andprioritize highest-return emissions reduction projects.

51 Appendix

The “boots-to-the-boardroom” accessibility to data
that’s otherwise been unavailable allows Civitas to set
better, more meaningful targets. In 2023, Civitas plans toenhance the ESG dashboard to aggregate monthly scope
2 GHG emissions data, develop dashboards for safetyand diversity metrics, and provide additional user training
for employees.
The company’s data systems and software combine toprovide a strong methodology to track and analyze data.
Data is fed into the system and applied to EPA-compliant
templates based on applicable Greenhouse Gas
Reporting Program forms. The EPA validates the annual
data to ensure appropriate methodologies are utilized.
Civitas’ software systems and data management
solutions, inclusive of those described in this report,
are designed in alignment with the security standards
necessary to meet financial reporting requirements.
As a publicly traded company on the New York Stock
Exchange (NYSE), Civitas Resources is bound by Sarbanes
Oxley Act (SOX) compliance. Through the company’s
compliance activities, Civitas collects, monitors,
protects, and tests data used throughout financial
reporting processes that would impact the company’s
key stakeholders, including Civitas’ investors, vendors,
owners, and communities. Civitas engages third-party
audit firms for annual audits to validate Sarbanes Oxley
compliance and ensure the Company’s security control
protocols are adhered to. Civitas Resources is committed
to continuous process enhancement to ensure its IT
security posture is maintained and sustained.

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Cost of carbon calculations are inherently critical to Civitas’ commercial success and its ability to serve stakeholders.
As an operator in a state with some of the most rigorous air emissions regulations in the nation, proactively
participating in the development of and preparing to meet new Colorado standards is a competitive advantage for
Civitas as the state and various stakeholders increasingly expect superior environmental performance. Civitas’ emissions
reduction targets often help produce results exceeding regulatory requirements. Natural gas pneumatic retrofit to
instrument air, optimizations of compressor systems, pipeline looping, and electrification are examples of projects that
help meet regulatory compliance obligations and support the accomplishment of emissions reduction goals.
Scope 1 GHG emissions from pneumatic devices decreased 4.4% in 2022 as compared to 2021 as Civitas
began implementation of the retrofit program in 2022 that will hit its stride in 2023.
Operational, procedural, and equipment upgrades resulted in a 95% reduction in scope 1 GHG emissions
from well unloading in 2022 as compared to 2021.
Civitas joined the Zero Routine Flaring by 2030 initiative with the World Bank. Associated Gas emissions fromroutine flaring were reduced by 99% with a complete phase out of the source type by year end 2022.

Beyond Civitas’ strategic investment incarbon emissions reductions projects,
Civitas annually spends about $9 million
on ongoing carbon emissions permitting,monitoring, and reduction.
At various locations
these projects include

Air monitors measure methane,
total VOCs, and other air
pollutants including Particulate
Matter (PM) and Hazardous Air
Pollutants (HAPs).

Emissions control
device stack testing

Ambient air quality
monitoring

FLIR leak detection &repair — FLIR cameras areused daily in the field

Compression optimization,
electrification, and replacement of outdated engines

Fuel gas measurement
on engines

Annual and semi-annual
leak prevention
maintenance programsContinuous methaneleak monitoring
technologies

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51 Appendix

Regulatory Preparedness
On a national regulatory level, Civitas is regularly evaluating and proactively
planning how it would comply with potential future regulations and policies.
Through direct engagement with regulators as well as through State and National
trade associations, Civitas collaborates with stakeholders and actively participatesin the development of responsible regulation. In 2022, Civitas participated in two
significant federal rulemakings directly related to methane reduction (OOOOb/cand the MERP). Taking part in these processes enables Civitas to both prepare forcompliance and proactively comply.
Civitas continuously engages in rulemaking with new air quality regulations in
the State of Colorado. As with federal rulemaking, Civitas’ participation in State
rulemaking allows regular evaluation and preparation for upcoming compliancerequirements. This active involvement with rulemaking at both the federal and statelevels encourages a partnership between regulators and Civitas and positions Civitas
in a thought leadership role for policy development.
In addition to GHG compliance requirements, Civitas tracks, permits, and works
to comply with all applicable state and federal air regulations. These rules regulate
additional air quality constituents — including but not limited to volatile organic
compounds (VOCs), HAPs, nitrogen oxides, sulfur oxides, and particulate matter.
Air quality reviews are conducted weekly, and the company regularly coordinateswith appropriate state regulators to participate in voluntary air pollution emissions
reduction activities, especially during the summer ozone season.

Case Study: Oil Trucking vs Pipeline

TOTAL CIVITAS

70% of the oil Civitas produces within Colorado is trans-

ported off-pad via pipeline infrastructure, with the remaining 30% trucked. Avoiding trucking decreases road miles
and thus, emissions. Less traffic on the roads also reduces
the potential for traffic-incident related spills and the burden on the communities in which the company operates.

Case Study: Orphan Well Plugging
In January 2022, Civitas Resources announced its commitment to voluntarily plug 42 wells that were orphaned by previous operators located in and around the company’s operatingareas. Civitas has begun the process of plugging these wells and anticipates completion in 2025.
“Orphaned” wells are wells unrelated to Civitas that were abandoned and whose cleanup would otherwise be the responsibility of the state of Colorado. When orphaned wells areleft unplugged, they can emit greenhouse gases such as methane and carbon dioxide, which amplify the effects of climate change. Plugging the 410 abandoned wells within the stateof Colorado is an important step for the state to meet its commitment to reducing statewide greenhouse gas pollution by 90% by 2050, relative to 2005 levels.
Business Wire article: https://tinyurl.com/3tt8cue8

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EMISSIONSMONITORING &MANAGEMENT
Monitoring Technology

The company’s efforts to detect and quantify emissions
throughout its operational footprint are foundational toits status as a carbon neutral operator.
To improve and validate the data across varying
operations, the company has partnered with two
external groups to conduct annual flyover assessmentsin the DJ Basin and analyze company assets using
top-tier technology.

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51 Appendix

Civitas installs 24/7 leak detection on newly constructed facilities. This technology enables
immediate leak detection and repair efficiency and high-grading monthly, quarterly, semiannual,and annual inspection frequencies. These technologies have far-reaching benefits beyond
leak detection, including tank level measurements, spill notifications, safety and fire response
notifications, equipment run-time, and leak quantification. Civitas has more than 100 air monitoring
systems at more than 90 locations equipped with 24-hour, real-time ambient air monitoring stations.
The company plans to expand its long-range laser detection program in early 2023, a technology
with the added benefit of detecting leaks at adjacent sites in the existing infrastructure.
Civitas performed over 9,000 optical gas imaging inspections in 2022. This technology allows thetechnician to survey all the equipment and piping at a facility and see very small methane leaks thatmight otherwise be undetectable. Civitas’ optical gas imaging (OGI) inspection program exceeds
standard practice at the state and federal compliance levels and will likely dovetail with future
regulatory requirements.

Of the 9011 OGI inspections performed, 3,338 very small leaks
were repaired at 608 locations

In 2022, 1,881 surface facilities and 1,419
miles of pipeline were inspected, with an
integrity finding in excess of 99.99%

CIVITAS | 2023 ESG REPORT 19

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12 Environment

THIRD-PARTYCERTIFIEDRESPONSIBLY
SOURCED GAS
Civitas has more than 30 wells that are third-party certified
to produce RSG, positioning itself to sell RSG to customers
with a certified promise that its gas has a lower scope 1
GHG emissions footprint than traditionally sourced gas. The
certification process requires an independent third-party review
with rigorous analysis of design, operations, and practices andvalidates Civitas’ production of affordable, reliable energy tosupport the energy transition.
In 2023, Civitas plans to obtain additional energy certificatesfor up to 9 existing sites, and 11 new locations, potentially
increasing available RSG deliveries by 50x.
The Oil and Gas Methane Partnership (OGMP 2.0) is an
United Nations Environmental Programme for comprehensive
measurement-based reporting of methane emissions for theoil and gas industry. Civitas became a partner in 2022 with thesubmittal of its OGMP 2.0 implementation plan. Civitas seeks
to fulfill Level 4 and Level 5 methane emissions disclosure
guidelines under the programme — the levels requiring thehighest granularity — as a foundation for its responsibly
sourced production.

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51 Appendix

ENERGY MANAGEMENT &RENEWABLES
Civitas is investigating opportunities to manage its scope 2 GHG emissions footprint by investing in renewable energy generation
to power a portion of its operations. Civitas has installed solar capabilities on certain pads to power low voltage systems and is
exploring opportunities to vertically integrate its electrical usage with solar production through programs with utilities.

Aligned with its commitment to reduce emissions first and then offset residual emissions second, Civitas
continues to evaluate strategies to operate with energy-efficient systems and lower energy requiring
technologies where feasible, recognizing that using less energy overall is a vital component of cutting
emissions.

ELECTRIFICATION OF ASSETSElectrified over
58% of drilling
activities in 2022

Piloted electrified
hydraulicfracturing fleets

Electrifying
compressors,
where feasible
and appropriate

Installing electricallypowered artificial
lift technologies,
where feasible andappropriate

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SUMMARY OF
CIVITAS’ EMISSIONSREDUCTION GOALS

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51 Appendix

Remain carbon neutral
across scope 1 and scope 2

Reduce scope 1 greenhouse gas emissions intensity
Emissions-controlled firstby a fixed 2.5% annually from theproduction2019 SubpartWequipment
reporting baseline, averaged over 10-years

Reduce absolute scope 1
GHG emissions 50% by
2027 from a 2021 baseline

Reduce scope 1 GHG
pneumatics emissions by>80% by 2025 from a2021 baseline

Zero routine flaring afterJanuary 2022

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51 Appendix

WATER MANAGEMENT
Colorado water is a precious commodity, supplying fresh water to sevenstates in the Western United States. Civitas understands the criticalrole it plays in driving environmental stewardship of this importantresource. In January 2021, the Colorado Oil and Gas Conservation
Commission8 (COGCC) implemented Rule 615, regulating groundwater
quality standards associated with new oil and gas development. Rule 615
requires monitoring wells within a 0.5-mile radius of the location to besampled prior to drilling to establish an analytical baseline. Subsequent
samples are collected 6-12 months post well completion,5-6 years postcompletion, and every five years thereafter during the life cycle of thewell. A final sample is required to be collected and analyzed 6-12 months
after the well has been permanently abandoned. Should the company
experience an event that impacts water quality, Civitas intends to follow
site specific COGCC recommendations.

The company works to reduce water use through numerous efforts, including the use of tanks andtemporary collapsible water pipelines to minimize unnecessary water evaporation. At sites wherewater collection infrastructure systems are available, Civitas reverses piped water disposal systems
to enable water reuse and recycling. The subsurface zones targeted in the DJ basin generally do
not produce water in sufficient volumes to supply other operations; therefore, opportunities torecycle water are more limited than in other geographies.
Civitas disposes of produced water at third-party saltwater disposal (SWD) wells and seeks to do
so in a responsible manner. For produced water management, Civitas evaluates the closest waterdisposal locations as part of the bidding process to optimize for drive times and distances.
Consistent with regulatory requirements and industry best practice, Civitas discloses the chemicals
it uses during the hydraulic fracturing process through FracFocus.org.

WATER RESOURCE MANAGEMENT IN PRODUCTION
Monitoring wells are sampled and tested on a prescribed cycle to help ensure local freshwater resources are protected. Groundwater samples are collected for laboratory analysis inaccordance with COGCC Rule 615 Part E Section 2, which includes total petroleum hydrocarbons (TPH), benzene, toluene, ethylbenzene, and xylenes (BTEX).
2022 Baseline Sample Data

38 initial water samples were collected in 2022 Subsequent Sample 1 (6-12 Months Post Completion)

Subsequent Sample 2 (60-72 Months
Post Completion)

Subsequent Sample 3+ (Every 5
Years Post Completion)

•

•

•

•
•

28 first subsequent water samples werecollected in 2022
5 samples indicating a reportable change
from baseline
0 samples indicating a change >5mg/l
from baseline••

2 water samples were collected in2022
1 sample indicating reportablechange between sampling periods9
0 samples indicating a change>5mg/l between sampling periods

8
Renamed the Colorado Energy and Carbon Management Commission (ECMC), formerly the Colorado Oil & Gas Conservation Commission in
2023. The result of SB23-285 – the ECMC reflects the ever-evolving nature of energy development and use in Colorado.
9

Change was investigated and not determined to be from oil and gas development.

0 samples taken in 2022

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SPILL PREVENTION &ASSET MANAGEMENT
Spill prevention is an essential part of Civitas’ license to operate, andthe company goes to significant lengths to proactively manage thisrisk. When spills do occur, the company’s Spill Response Notification
Program is designed to drive internal communications, and qualifying
spills are expected to be reported to regulators with immediacy. Civitas
leverages a root cause investigations to identify lessons learned andsystemic weaknesses, helping to proactively prevent future spills by
incorporating these insights into facility design, maintenance programs,
and procedures. Civitas recently formed a separate operations integrity
team that encompasses chemistry, maintenance, and equipment
integrity to help investigate spills and identify the root cause.

41 Governance

EMERGENCY/SPILL RESPONSE TRAININGS
Drills, Mock Simulations,
Coordination with Local
Responders (Annual)

SPCC Plan (Annual)

51 Appendix

Civitas has a company-widetarget to reduce reportablespills by 20% compared to2022 for the year 2023
2022 SPILL DATA

Reportable spills decreased in
the second half of the year.

Emergency Response Training
and Drills (Annual)

Desktop Drills (Annual)

Unannounced Drills (Annual)

Civitas’ sites are outfitted with technology designed to allow its operations team to remotely shut
down assets in case of an emergency or under elevated risk circumstances like extreme weather. If
a spill incident occurs, Civitas employees are expected to act immediately to assess the site, ensure
they can safely engage, and then rapidly respond to control the spill or release. Civitas collects
data regarding the release at the site of the incident, assessing the impact on the environment andresponding accordingly.
Civitas has consolidated the Spill Prevention, Control, and Countermeasure (SPCC) plans of its
legacy assets to develop a consistent set of practices and protocols across its operating sites.
Civitas employees are required to operate in accordance with these standards and trainings, which
are tailored to the nuances of each operational location.
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BIODIVERSITY &ECOSYSTEMS
Biodiversity impacts are a principal consideration given
Civitas’ geographic footprint and the unique environment
and ecosystems of Colorado. Civitas’ Wildlife Program
incorporates wildlife and nature resource protection
measures and Best Management Practices (BMPs) designed
to mitigate impacts on biodiversity and ecosystems.
For various sites these intended
measures and best practices include

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51 Appendix

Environmental site assessments
to survey for sensitive wildlife
prior to new operations

Wildlife protection andmitigation plans

On-site and third-party
qualified biologists

Collaborations with wildlife
agencies for wildlife protection/
mitigation guidance and data
provision (i.e., Colorado Parks
and Wildlife and U.S. Fish andWildlife Services)

Scheduling of operations
outside sensitive wildlife
seasons, when possible

Reporting of injured or orphaned
wildlife and transportation torehabilitation facilities

Wildlife education
sessions for staff

Sound wall installation

Limited daily working hours incertain seasons and habitats

Buffer establishment in line withspecies-specific buffer zone
guidance from wildlife agencies

Wetland delineations andassessments of other sensitive
wildlife habitats

Stormwater BMP installation

Strategic selection ofoperation locations where
there has already been an
environmental disturbance,
when possible

Restoration of disturbed areas
to their original self-sustaining
ecosystem upon completion ofoperations

Execution of multiple project
phases simultaneously
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BIODIVERSITY &ECOSYSTEMS

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Civitas leverages technologies to help minimize
the ecological impacts of its operations. For
example, increasingly extended-reach horizontal
drilling expands sub-surface operations fromthe same well pad as opposed to drilling acrosssurface geography.
Civitas’ Biodiversity Policy helps guide its selectionof new operating locations, often considering
the presence of preexisting environmental
disturbances. Prior to beginning any drilling
operation, the company conducts a desktop
survey, an environmental site assessment, a fieldsurvey, and an alternative site analysis to help
understand all biodiversity and ecosystem impacts.
Third-party vendors collect aerial survey data
to view disturbance areas and conduct change
analysis from initial buildout to disturbance, which
is used to design reclamation plans. Civitas has
a new priority habitat mapping process for all
operations and comprehensive area plans.
At times, the company may alter its development
plans to account for local wildlife and minimize
impact, as it deems necessary.
Civitas seeks to consider impact to wildlife
throughout all operational phases, including
development and construction, operations,workover operations as well as maintenance,
remediation, and decommissioning. In addition
to working to ensure compliance with all wildlife
protection requirements set by the COGCC,
Civitas voluntarily requests third-party due
diligence surveys prior to all new operations to
help ensure compliance with wildlife laws andto avoid unnecessary harm to wildlife. Civitas
contracts with wildlife biologists to review
the nuanced impacts of seasonality on the

41 Governanceecosystem throughout operations and help
ensure the company does not disturb breeding
grounds, nests, or other seasonal wildlife.
If active nests or other sensitive wildlife or
habitats are found, appropriate protection andmitigation measures are implemented, including
project delays.
All relevant field personnel are trained to ensure
they understand their obligations, responsibilities,
and tasks required under the company’s
Environmental Compliance Plan. Personnel arealso equipped to recognize migratory birds andmaintain awareness of surrounding wildlife during
the execution of their normal duties.
Civitas’ commitment continues through theend of the lifecycle with a robust reclamation
program that clearly defines the protocols
and processes around biodiversity and habitat
restoration. The company performs interim
reclamation — the middle phase between drilling
and the final reclamation element of plugging awell — partnering with biologists, well-planners,
reclamation experts, and other natural resource
specialists to return the land to a state that willappropriately benefit the ecosystem.
Civitas strives to operate responsibly and avoid
unnecessary harm to wildlife. The company intends
to continue to collaborate with wildlife agencies todevelop the best field-wide and site-specific BMPs
to protect wildlife resources and habitats.

51 Appendix

2022 STATISTICS:

Civitas conducted more than
400 environmental surveys

10 projects had biologists (withstop work authority) present onsite during operations to monitor
nearby active bird nests and birds’
responses to operations

12 projects were rescheduled
in order to protect seasonal
wildlife resources
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51 Appendix

Case Study
Civitas’ bird mitigation program is designed to limit impacts to birds
near operations. In one scenario, the identification of an active nest
resulted in delayed construction in order to allow the nestlings tofledge, even though the species was not protected by the Migratory
Bird Treaty Act (MBTA).

Case Study
In another scenario, for work adjacent to an active bald eagle nest site,
Civitas consulted with the CPW, COGCC, and a third-party wildlife
biologist to determine a mitigation plan. Time sensitive work was
performed, with agency and consultant monitoring to assess the eagles’
response to the activity. The remaining operations were put on hold until
it was confirmed that the eaglets had fledged the nest.
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WASTE MANAGEMENT

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51 Appendix

CIVITAS WASTE CATEGORIZATION PROCESS FLOW:Is the material an unused product?

Civitas has a process designed to ensure waste, both hazardous and non-hazardous, is classified, tracked, treated, handled, transported, stored, anddisposed of in conformance with regulatory requirements. Civitas is building
uniform waste management practices and procedures across operations, inNoIs the material known?

Yes
Adhere to storage practice or return.

addition to aggregating waste management data.

Civitas’ drilling operations reduce the potential waste stream
from drilling fluid by an estimated 50% by utilizing emissions
controlled multi-stage separation processes for re-use of drilling
fluid. This practice reduces the consumption of the highly
refined and odor stabilized base oil and extends its useful life
significantly. Solids removed from the product are treated tomitigate the remaining volatiles inherent to the reservoir rock tomeet the solid waste disposal guidelines. This process reduces
consumption, reduces waste, decreases truck traffic to and fromthe site for deliveries and disposal, and prolongs the life of thetechnical components, ultimately reducing the amount of timeon the location and the risk exposure of the project.
At each operational site, the company has established protocols
that define roles and responsibilities for overseeing waste
management. Job-specific training is provided to help ensure
employee safety and regulatory compliance.
The Colorado Department of Public Health and Environment(CDPHE) 6 CCR 1007-1 Part 20 — Registration and Licensingof Technologically Enhanced Naturally Occurring Radioactive
Material (TENORM) provides guidance to individuals who
generate, handle, process, transfer, receive, transport, disposeof, possess, distribute, and beneficially use these materials, aswell as training guidance for employee training.

Yes
Is it E&P waste?

No
Must be treated as Hazardous and asample taken to determine characteristics.
Hazardous Waste
Follow RCRA and state
regulations.

Yes
Can it be reused or
recycled?

Yes
Develop a procedure toreuse or recycle.

Yes
Perform feasibility
analysis to ensure
applicability oftreatment plan.

No
Can the E&P waste
stream be treated?

No
Dispose of all E&P waste inaccordance with all federal,state, and local regulations.

No
Is it a hazardous,
universal, used oil,or non-hazardous
waste?

Universal
Store and utilize approved
universal waste handler forrecycling.
Used Oil
Recycle used oil in accordancewith Civitas used oil SOP.
Non-Hazardous
Reuse or recycle where applicable.
If not, dispose of as a nonregulated solid waste.

CIVITAS | 2023 ESG REPORT 27

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SOCIAL28 Social

29

Managing Social Risks & Opportunities

30

Governance34

Human Capital Management

37

Community Engagement & Volunteering

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51 Appendix

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MANAGING SOCIAL RISKS& OPPORTUNITIESCivitas’ social license to operate is the cornerstone of its business, and thecompany strives to support the communities where it operates. Civitas takes aproactive approach to operating new sites, communicating with stakeholders,looking for opportunities to mitigate associated impacts — direct or indirect— and working to ensure all operations are conducted with the utmost respect
for surrounding communities. Civitas’ believes its operations are quieter, emit
fewer pollutants, require less traffic, and operate more reliably than traditional
operations.
The Company believes that forging strong relationships with local communities
is critical to Civitas’ strategy and is achieved by soliciting robust feedback fromfrequent stakeholder engagement. Civitas targets practical strategies that empower
the company to be more socially and environmentally responsive within its
communities and for its partners.

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51 Appendix

HSE PROGRAMS & TRAININGHEALTH & SAFETY

Civitas’ commitment to safety is important to the company’s operations model, andsupporting the wellbeing of team members is a fundamental tenet of company culture.
Civitas expects employees to operate in a safe and environmentally responsible manner,
whether at the corporate office or in field operations. Civitas is committed to abiding byboth the spirit and the letter of all applicable laws, regulations, industry best practices,
and internal policies and standards. Civitas understands that meeting and exceeding theseobjectives is essential to gaining the trust of employees, communities, and regulators.
In the past year, Civitas assessed its entire EH&S management system, consolidatingprocesses and procedures from legacy companies into a single system that conveys thesame expectations and communications across the company. It is believed that engaging
employees’ input in developing this system helps Civitas gain the trust of its employees,
and ultimately leads to improved health and safety outcomes. Civitas’ new EH&S
management system is expected to be fully executed and implemented in all parts of thebusiness in 2024 and audited annually thereafter.
Civitas has a zero-incident goal and a 100% reporting expectation. Safety is expected to
be prioritized in each planning conversation and decision made by management, officepersonnel, field employees, and contractors. Safety is not delegated to one organizational
department or to certain personnel; it is embedded across the company’s operating
policies and procedures, with no task exempt from scrutiny. Every employee, contractor,
and visitor on Civitas’ locations has the right and the obligation to “stop work” if theyobserve operations that are planned or executed without a complete risk assessment
or safety management, supporting Civitas’ commitment to safety accountability andcontinuous improvement. This commitment extends to ensuring Civitas employees are wellinformed on lessons learned and progress against identified targets through monthly safety
meetings.

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51 Appendix

GOVERNANCE

The governance of health and safety is overseen by the Board’s ESG Committee.
The Chief Operating Officer, who reports directly to the Chief Executive Officer,
is responsible for the oversight and ownership of Civitas’ organizational healthand safety programs and initiatives. This role tracks and manages safety data
and reports this data to the executive leadership team on a weekly basis tohelp ensure continuous oversight and accountability. Civitas reorganized andquintupled the management structure of its EHSR team in 2022, promoting
from within to add Vice President of EHS and Regulatory, Director of Air
Compliance and Engineering, and Director of Regulatory and Permitting roles,
and making experienced external hires to fill the Director of EHS and Directorof Process Safety Management (PSM) and Emergency Management. These newpositions have an essential management role in health, safety, and complianceoversight and reinforce Civitas’ commitment to its goals by bringing in theleaders necessary to help achieve them.

CONTRACTOR SAFETY
Civitas uses specialty contractor services for the labor and equipment required to execute intermittent and highly technical operational activities. Ensuring contractor safety is just as crucial as that of full-time employees. The Contractor Expectations Manual provides contractors
with a clear understanding of the environmental, health, and safety expectations that Civitas
sets for its third-party contractors and sub-contractors. The following contractor procedures
are implemented at Civitas to help ensure effective EHS management:•

All employees are required to abide by Civitas’ Environmental, Health, Safety& Regulatory (EHS&R) policy as stated in the EHS&R Manual. Civitas’ safety
management systems align with OSHA, API RP74, and API RP54 and target
continual improvement and industry best practices.
•

Weekly Data Reporting•

TOTAL RECORDABLE INCIDENT RATE (TRIR)SENIOR VP OFOPERATIONSDAYS AWAY, RESTRICTED OR TRANSFERRED (DART)•EXECUTIVE
LEADERSHIP TEAM•

 ontractors are identified, evaluated, and selected based upon an analysis of strong EHS
Cmanagement practices and performance criteria, including risk tiering and the evaluationof dollar spend in comparison to risk. Civitas uses a third-party supply chain management
software application to verify contractors’ safety, procurement, regulatory, and quality data,
facilitating a complete and equal assessment.
 ivitas has implemented a new MSA process for a review of subcontractors and isCtransitioning all legacy contractors to the Civitas MSA, helping to ensure that subcontractor
performance meets Civitas’ expectations.
 ontractor safety performance is monitored in the field and verified through audits. The
C
audit process involves field observations and a summary of the findings during a tabletop
review. The annual audit cycle is intensified, as necessary, when performance indicates that
additional oversight would benefit safe work practice adoption and engagement.
 ivitas aims to provide contractors with a workplace free of known unmitigated hazards
C
where any identified hazards or EHS issues are promptly addressed. Contractors are
empowered to identify and communicate new hazards to Civitas using Stop Work Authority.
 ontractors participate in frequent safety meetings alongside Civitas employees to stayC
informed, engaged, and compliant with company standards.
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Civitas is committed to maintaining an annual TRIR (inclusive of both employees
and contractors) below 0.25, a target below the industry average as reported by
the Bureau of Labor Statistics for the oil and gas extraction industry.*2021 TRIR

0.17(RATE PER HOURS)

2022 TRIR

0.26(RATE PER HOURS)* U.S> Bureau of Labor Statistics 2021 Total recordable cases rate of injury and illness in oil and gas subsector
https://www.bls.gov/iag/tgs/iag211.htm#fatalities_injuries_and_illnesses

41 Governance

INCIDENT MANAGEMENT
Civitas’ new EHSR management system allows the company to investigate incidents ingreater detail. By assigning risk rankings to near misses based on Serious Incident &Fatality (SIF) potential and considering near misses as if they had occurred, Civitas isbetter able to identify root causes and mitigate future risks through protections andcontrols.
When incidents do occur, they are expected to be reported to direct supervisors andthe Environmental Health, Safety & Regulatory (EHSR) department as soon as practicallypossible. Civitas has established a uniform system for capturing essential information
required to understand incident causation and develop improvement actions to prevent
reoccurrence. Civitas’ incident management procedures include:•

SAFETY TRAINING PROGRAM MANAGEMENT
A culture of safety excellence among employees and contractors is an
important component of corporate success. Civitas seeks to continuously
monitor change and adjusts accordingly, learns from incidents, and strives for
improvement. The company sets the expectation that safety is executed atevery decision point and that each employee and contractor is a safety leader.
Civitas sends out a monthly newsletter that is delivered to every employee
and contractor across the company, sharing safety stories that showcase
lessons learned, best practices, and employee engagement.

STOP WORK AUTHORITY
Employees and contractors have the right and responsibility to stop any
work when an unsafe condition has the potential to result in injury, createan adverse impact on the surrounding environment, or damage property.
Contractors are responsible for adhering to Civitas’ standards, training theiremployees on stop work requirements, and ensuring supervisors support thisculture. In policy and practice, individuals who use stop work authority areprotected from negative repercussions.

51 Appendix

•

•

•

 third-party medical case management service providing medical knowledgeAand advice customized to specific incident needs. This service creates weekly
reports for the executive team for oversight and awareness of health and safety
performance.
In the event of an injury incident or severe near miss, the company conducts a root
cause analysis to understand causal factors. The analysis is facilitated by EHSR andincludes supervisors and other parties contributing relevant information.
 ontinual proactive risk assessments to identify any associated risks to health andCsafety arising from work activities, helping to ensure that actions are taken to eliminate
or minimize those risks.
 ivitas hosts annual safety drills and mock simulations, as well as coordinatesCwith local agencies to prepare first responders for industry-related incident
management. This cooperation and coordination with emergency responders
familiarizes local response teams with operating locations and potential conditions.

Incident reporting is entered into a software application, automatically integrating data
into the EMIS system-of-record for reporting and the ESG dashboard, allowing Civitas tocontinually track and monitor relevant incident metrics. Leveraging this data helps thecompany apply a proactive, risk-managed approach to incident management to achieve
incident-related goals.
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Civitas’ unified incident investigation process facilitates
improvements in facility design, enabling the company todevelop a standardized design that mitigates the needfor costly retroactive facility updates and it is believed
ultimately decreases the potential for incidents.

EMERGENCY PREPAREDNESS
Civitas’ Emergency Response Plan establishes a consistentframework to follow in case of an emergency. Having ahigh-quality plan is essential to saving lives and minimizing
impacts, and Civitas continuously measures and works
to improve its emergency response to drive best-in-classprotocols. This continuous improvement is outlined in the‘Plan’ ‘Do’ ‘Check’ ‘Act’ cycle, which is incorporated by ISO
14001 and OHSAS 18001. Civitas’ leadership is involved
in all aspects of planning, performing, measuring, andimproving practices to respond to emergency conditions
adequately and appropriately.

CONTINUOUS IMPROVEMENT CYCLE

DO

CHECK

PLAN

ACT

41 Governance

51 Appendix

Being prepared to respond to potential incidents is essential forrisk mitigation. Civitas’ emergency management program follows
the Federal Emergency Management Agency’s (FEMA) National IncidentManagement System (NIMS), which provides a common structure tofacilitate cooperation with local, state, and federal agencies in managing
emergency response.
Civitas’ emergency management planning includes systems to train andprepare personnel. This encompasses risk assessments and plans to
mitigate and minimize impacts to the environment, implementing Incident
Command System Training, acquiring membership with the Marine
Preservation Association, or MPA, (provides support for response throughthe Marine Spill Response Organization, the largest oil spill removalorganization in the US), and a proactive network of systems to help ensurecompliance with regulatory requirements.
Civitas works with employees, local fire departments, and industry
partners to conduct table-top drills internally and externally to test
capabilities, tactics, systems, and response while improving coordinationand communications.
— Lisa David, Director, PSM & Emergency Management
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Case Study

Civitas’ Sustained
Investment in the
Colorado Preparedness& Response Network
In 2022, Civitas continued its investment inemergency response and preparedness training
for firefighters across the DJ Basin through the
Colorado Preparedness & Response Network.

200

FRONT RANGE FIREFIGHTERSPARTICIPATED IN EMERGENCY RESPONSE SCENARIOSTO TRAIN AND BUILD EXPERTISE IN HANDLING OIL
AND NATURAL GAS INCIDENTS IN 2022.

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41 Governance

TRAINING & PREPAREDNESS
Civitas continues to build a high-performance
culture by requiring employees to participate
in training courses that help ensure work iscompleted safely and efficiently. In some instances,contractors are required to participate in Civitas
training sessions to certify that they have been
informed of company expectations.
Civitas employees participate in online, classroom,and field training courses that are OHSA-requiredor job-specific. The course types vary by employee
group, job responsibilities, and manager discretion.
Hiring managers and supervisors work with the
EHS&R department to build training profiles andassign courses specific to job positions. Courses
are mandatory, with participation and completion
factored into the annual performance management
process.
The EHS&R department hosts industry-specificclassroom training courses throughout the year
to inform employees of relevant safety andenvironmental topics. Employees who performor supervise safety-critical tasks are trained andexpected to demonstrate competency before
executing their responsibilities.
In field locations, Civitas utilizes pre-job checklists,risk assessments, change management, tailgate
safety meetings, and a job safety analysis (JSA) toassess and control hazards at each site. Tailgate
safety meetings are held with all members of thecrew at the start of each workday, shift, or taskchange. During these meetings, personnel discuss
the planned work activities for the day as well as
any health, safety, and environmental concerns
before work commences.

51 Appendix

EXAMPLES OF EHS&RC TRAININGS:10
Civitas EHSR Manual and Policies

Pressure Testing

Confined Space Awareness

Rig Moves

Personal Protective Equipment (PPE)Working At Heights

Emergency and Spill Response

JHA and Hazard Identification

Hot Work

Hazardous Communication

Lockout Tagout

Safe Driving

Critical Lifts and Rigging

Colorado Air Quality Regulations

Electrical and Overhead Lines

100%

employees and contractors
are expected to complete
mandatory safety trainings

10
This list is for illustrative purposes
only —it is not comprehensive

100%

incidents are expected to bereported to direct supervisors
and the Environmental
Health, Safety & Regulatory(EHS&R) department
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HUMAN CAPITALMANAGEMENT
Civitas believes supporting a diverse and inclusive workforce

is valuable to success as a business, as it builds a culture thatwelcomes differences in perspective, encourages curiosity, andrewards innovative ideas that drive value creation and improve

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51 Appendix

DIVERSITY, EQUITY & INCLUSION ACROSS CIVITAS
Civitas mandates unconscious bias training for all employees to foster an inclusive environment where
everyone, regardless of background or demographic, feels comfortable and engaged in the workplace. This
training, along with the other trainings formally outlined in Civitas’ Human Rights Policy, is required annuallyfor all employees. These trainings are meant to inform employees on how to conduct themselves in a waythat is appropriate for all coworkers. These trainings make it clear that there is zero tolerance for any type of
discrimination or sexual harassment.
To embed these values in company culture, Civitas’ DE&I Subcommittee of the Employee Engagement
Committee is spearheading diversity, equity, and inclusion educational opportunities for employees.
Subject matter expert speaker events have been tailored to field, office, and executive audiences. Inclusion,
specifically creating curiosity around alternative perspectives, is a key objective in Civitas’ DE&I plan.

risk mitigation.

BOARD & EXECUTIVE LEADERSHIPAt Civitas, diversity starts at the top and continues
to be a focus for the Board of Directors. Civitas
has achieved its published ESG Framework targetof at least 30% female gender representation on
the board. Civitas recognizes that significant andsustainable diversity transitions take time, and along-term commitment is required to incorporate
diversity throughout the company.

In 2022, the board had

TRAININGS:[100% completion rate in 2022 on trainings]

30% +FEMALE DIRECTORS

Anti-Discrimination

Anti-Harassment

Diversity & Inclusion

Unconscious Bias
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51 Appendix

TALENT ATTRACTION & RETENTION
Civitas strives to support an efficient, talent-rich, and highly engaged team focused on creating value
for the company and shareholders. To accomplish this, it is essential that the company maintain a strong,collaborative workforce to attract and retain top talent. Diversity is an important factor in bringing the
Civitas team together and encouraging innovation and commitment. A diverse hiring pipeline is key toimproving Civitas talent pipeline, and it is a challenge that the company is committed to addressing.
To build a pipeline of diverse talent, Civitas is starting well before the hiring process itself. The company
collaborates with multiple organizations, such as the Hispanic Chamber of Commerce, the National Associationof Black Accountants, and the National Society of Black Engineers, to help build a robust pipeline of talent. In
building a protocol that creates a more diverse and equitable candidate search process, Civitas has leveragedthese organizations to promote opportunities to a more diverse pool of candidates. Civitas acknowledges themeaningful presence and participation of women and minorities in our business and industry.

2022 Workforce Demographics

77% Male

23% Female

Civitas continues to emphasize the importance of diversity and inclusion throughout the onboarding process.
The company is committed to providing equal opportunity for all candidates, employees, and consultants
regardless of race, religion, gender, sexual orientation, gender identity, age, ethnic or national origin, social
origin, disability, family status, or any other protected status or personal characteristics in all aspects of
employment. This commitment extends to training and professional development opportunities, internal
promotions, and employee benefits. Civitas mandates unconscious bias training for all employees, including
the recruitment team, to help ensure these practices are executed in recruitment strategies.
Civitas is committed to providing competitive pay to attract and retain the best talent in the industry. All
positions are publicly posted with a compensation range for the role. During 2022, the company rolled out
an annual compensation evaluation cycle to help ensure Civitas provides fair and equitable pay that aligns
with industry market rates.
All Civitas employees receive restricted stock awards on an annual basis, driving a culture of ownership andpay-for-performance rewards.

15%
Racial/EthnicMinorityIn the search for talent across geographic regions, Civitas prioritizes local hiring for both employees and contractors,
specifically in the area of field operations—to support employment opportunities in local communities.

Civitas aims to continue its trend of hiring more than
90% of talent from within its operating areas.

85% NonMinority

Data from Civitas’ 2022 EEO-1 report.

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EMPLOYEE ENGAGEMENT
Civitas strives to create a culture where employees can develop professional
skills and advance their careers by providing growth opportunities that include
training, professional education, and mentorship programs. The Employee
Engagement Committee is responsible for educational presentations,community service projects, and social events within Civitas.
In early 2023, Civitas created a Diversity, Equity, and Inclusion Subcommittee
under the Employee Engagement Committee with the goal of enhancing DEI
initiatives across the company, specifically by creating Employee Resource
Groups that enhance inclusion across the organization.

EMPLOYEE BENEFITS
To foster the health and wellbeing of Civitas employees and their families,
all full-time employees are offered access to financial, health, and wellness
programs, including:Compensation that is driven by
performance, achievements, and goals
A 401(k) plan and company match
Stock Awards
Paid Time Off (PTO)
Paid Sick Leave
Health insurance coverage for all full-time
employees − Includes medical, dental andvision − HSAs (when applicable to medical
coverage) − Life and AD&D Insurance− Short-term and Long-term Insurance −Accident & Critical Illness Insurance

Maternity and Paternity Leave
Paid and Unpaid Leave of Absences
Volunteer Time Off (VTO)

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51 Appendix

Civitas annually evaluates how it can enhance employees’ experiences, collecting direct input
from employee engagement surveys and identifying opportunities to implement improvements.
Specifically, improvements starting in 2023 include:• I mplementing tuition reimbursement of up to $5,520 on an annual basis, demonstrating Civitas’commitment to the professional development of its people.

• Providing two Volunteer Time Off (VTO) days per year, showcasing Civitas’ support of its employees’

contributions to the community.

• Changing designated holidays during peak busy season into floating holidays, so that employees canfully take advantage of their earned time off.

• Creating a charitable giving match of up to $1,000 per employee.

Civitas is proud of the wellness programs that it offers to its employees, including private personal
spaces for nursing mothers, an expansive fitness reimbursement that covers costs from gym
memberships to ski passes, and the Employee Assistance Program.

EMPLOYEE DEVELOPMENT
Civitas’ supervisors and managers proactively reach out to employees to discuss goals andprofessional development opportunities while providing constructive feedback to support
engagement, communication, and performance growth. Employees participate in annual employee
performance reviews, which are complemented by consistent communication between managers andemployees. Professional goals established in the performance management process are required toalign with environmental and safety elements to support the company’s ESG vision.

FSAs and Dependent Care Programs

As an entity that has grown significantly through mergers and acquisitions, professional development
is a key element Civitas is implementing to help ensure employees feel engaged, challenged, andsupported to grow among their peers and within their teams.

Employee Assistance Program

Civitas is committed to maintaining a variety of employee engagement forums, including:Fitness Reimbursement• Quarterly townhalls led
by the CEO

College Savings Plan
Tuition Reimbursement
Legal and Identity Theft Protection• Employee staff meetingsand one-on-one meetings• Employee newsletters tohighlight safety elements
across geographies• Company-sponsoredvolunteer activities• Employee
engagement surveys• Employee
Engagement
Committee• Reinvestment in education— providing employees withfunding for formal and advanced
education

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COMMUNITYENGAGEMENT &VOLUNTEERING

41 GovernanceAir-tight, closedloop systems
that capture
99.9% of scope
1 GHG emission
from oil flashing

Quiet fleet
completion
equipment that
reduces noise
impacts by 300%
compared to
traditional fleets

COMMUNITY STAKEHOLDER AND LANDOWNER ENGAGEMENT
Given the proximity of Civitas’ operations to local communities, maintaining

Tank-free facilities

engagement and trust with community stakeholders and landowners is critical.
Civitas manages an informational email account that is promoted at
local community meetings and on the corporate website to provide
stakeholders with the opportunity to easily voice concerns and ask
questions. Further, Civitas is developing an operations control center(OCC) with personnel available to field community calls and landownerconcerns, expected to be operational in 2023. These phone calls will
help to ensure that community concerns are acknowledged and acted
upon in an efficient manner. Civitas’ entire production operations teamis prepared and empowered to directly and promptly address or elevatethe concerns of landowners and neighbors.

COMMUNITY STEWARDSHIP
Civitas works closely with local and state safety officials as
appropriate to exceed applicable regulatory standards and helps
ensure neighboring communities have transparent, comprehensive
information about operations. Civitas has practices that are designed
to enhance the well-being and safety of these communities. Where
practicable, the company seeks to implement the following
innovative practices in operations:

Use of electric grid
power on sites(where feasible andappropriate) toeliminate exhaustemissions andengine noise

Plugging andreclaiming ofolder wells
to eliminate
emissions

State of the art
safety systems
that facilitate
automatic
shutdowns

Oil transportation through pipeline(70%), helping to reduce the oiltransported using heavy-haultrucking (30%)

51 Appendix

Civitas is fully committed to listening to its communities,
especially those in disadvantaged areas, to ensure
their voices are heard. The well drilling process
is one example of this behavior — before a new
well is drilled, a permit must be obtained throughapproval from the local government with land use
jurisdiction. Once that permit is obtained, a permit
application must be filed with the Colorado Oil and Gas
Conservation Commission (COGCC), which regulates
the development and production of oil and natural gas
in the state. Civitas works with the commission’s staff ofexperts for verification and approval of the proposed
operations, well location, integrity of the well design,
and accuracy of offset data.
The public is notified and invited to comment at
certain stages during these processes. It is crucial
to note that Colorado regulations for oil and gas
producers are among the strictest in the world, andCivitas often exceeds the performance mandated byregulations. Civitas aims for its operations to abideby the highest standards of environmental and social
integrity.
Civitas works to ensure all stakeholders have accessto appropriate information about the company.
Civitas’ communication efforts in connection withplanned or ongoing development are tailored toreach all audiences, including those without internet
access. Communications are made available in U.S.
Census-informed, locally predominant languages.
For new areas within Colorado that are designatedas disproportionately impacted or underserved
communities, Civitas communicates through virtualand in-person town halls, mailers, canvassing, phone
calls, and digital microsites to help ensure the proper
stakeholders are notified of planned operations andhave an opportunity to comment on future plans.
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42

52
51 Appendix

HUMAN RIGHTS
Civitas takes a proactive approach to human rights and indigenous rights, conducting
due diligence prior to developing projects and continuing community engagement
through the life of a well, as outlined in the Human Rights Policy. Community impact
assessments are conducted prior to planning development in new areas, and thecompany engages with community members closely. Civitas seeks to adhere to key
human rights principles, including those concerning freedom of association, collective
bargaining, and non-discrimination. Per Civitas’ Human Rights Policy, the company
is committed to providing fair wages; child and forced labor are never permitted;
and proper channels are in place to help identify and address any instances of
discrimination, including an anonymous ethics and compliance hotline. Civitas does
not currently operate on indigenous land; however, the company’s policy is to abide byFree Prior and Informed Consent (FPIC) due diligence.
Civitas believes it is prepared to respond and act in the event that any human rights
incidents surface. Team members and contractors have the authority and obligation
to raise relevant issues with management to help ensure fair labor practices via the
Civitas Compliance Hotline, an anonymous resource for any employee or stakeholder
to report unlawful or unethical behavior, as well as any instances of behavior that
may violate company policy. Civitas believes its commitment to human rights aligns
with the United Nations Universal Declaration of Human Rights, the United Nations
Guiding Principles on Business and Human Rights, and the International Labor
Organization Declaration on Fundamental Principles and Rights at Work.

The company had zero identified
human rights incidents in 2022.
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51 Appendix

CHARITABLE GIVING & SOCIAL INVESTMENT
WHY IT MATTERS FOR CIVITAS

A key aspect of Civitas’ enhanced focus on stakeholders is a commitment to sharing the value itcreates in the communities where Civitas employees live and work.
To facilitate meaningful partnerships with trustworthy organizations, Civitas established a new
giving framework to categorize contributions by the following pillars:
Agriculture

Humanitarian Relief

Community Infrastructure Improvement

Veterans and First Responders

Education
PROGRAMS & INITIATIVESIn November 2022, Civitas officially launched the Civitas Community Foundation, a 501(c)(3)organization providing project grants and scholarships in nearby communities with special
dispensation to those located closest to company operations. The foundation’s inaugural
event was a partnership with Operation Warm, in which Civitas contributed $250,000 toprovide new winter coats to kids attending federally designated low-income schools within
its operating areas. Civitas plans to continue this partnership in future years as well asaward additional community grants and scholarship opportunities. Civitas plans to commit$250,000 through the Civitas Community Foundation in 2023.
In addition to the Community Foundation, Civitas plans to continue its meaningful supportof local organizations that make up the fabric of its communities, including public schoolfoundations, volunteer organizations, and food banks.
Civitas’ aspiration to develop community solar gardens throughout the Front Range ofColorado is ongoing. Civitas’ community solar initiative is designed to reduce utility costs
by 10 percent or more for neighboring subscribers and help Colorado meet its renewableenergy goals. The company is hopeful to begin development in 2023.

Civitas is offering to install electric vehicle charging stations in the communities where
the company operates. In 2022, Civitas placed orders to begin converting its corporate
fleet of work trucks to electric and hybrid utility vehicles, with the goal of creating afully electric fleet as durable technology becomes available.
Outside of its surrounding communities, the humanitarian crisis in Ukraine weighedheavily on our state and our country in 2022. Civitas quickly engaged by contributing
more than $10 million between Project Cure, World Central Kitchen Inc, UNICEF, andSamaritan’s Purse. In future years, Civitas aims to balance its contributions more evenly
across its giving pillars.
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Case Study:

Community Foundationof Boulder County

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51 Appendix

IN 2022, CIVITAS CONTRIBUTED TO THE
FOLLOWING ORGANIZATIONS:COMMUNITY GIVING
2022 donations and ongoing partnerships*

Pillars:$111,000 $60,000$110,000

AGRICULTURE

HUMANITARIANRELIEFIn 2022, Civitas fulfilled its $1 million pledge

COMMUNITYINFRASTRUCTURE

to the Community Foundation of Boulder

County to aid in relief efforts following the$370,000 $70,000$75,000

disaster in Colorado history. The fire forced the

EDUCATION

VETERANS AND FIRSTRESPONDERSMarshall Wildfire, the most destructive wildfire
evacuation of 35,000 people and impacted

INDUSTRY CHARITABLEFUNDRAISER

1,000 homes and businesses throughout thecommunity. Specifically, the company provided$500,000 immediately to the Community

Foundation during the triage phase of the crisis
and an additional $500,000 throughout theyear to meet additional needs resulting fromthis disaster.

$1,000,000 $10,000,000
COLORADO DISASTER RELIEF

UKRAINIAN HUMANITARIAN AID

These one-time donations were made beyond the scope of Civitas’ planned giving
efforts, representing the company’s proactive support of communities in crisis.

* Dollar amounts include spend between January 2022 – December 2022.

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GOVERNANCE

42

Corporate Governance44

Our Executive Leadership45

Our Tools

46

Compliance, Business Ethics and Professional Conduct

48

Management of Third-Parties and Suppliers

49

Cyber Security

50

Political Engagement & Regulatory Planning

41 Governance

51 Appendix

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CORPORATE GOVERNANCE

Stakeholder engagement and ESG leadership are core tenets of Civitas’ operations and key to its longterm competitive advantage. The company’s governance structure reflects this commitment, and isdesigned to ensure the Board of Directors and Executive Team’s interests align with shareholders andother key stakeholders.

BOARD OVERSIGHT
The Board of Directors is elected by shareholders to set strategy and oversee
management and is legally required to put shareholders’ interests ahead of their own.
To ensure this alignment with shareholder interests, Civitas compensates its Board
primarily in stock. Civitas is committed to delivering on the promise of a new model forthe exploration and production sector focused on maximizing enduring and predictable
free cash flow (as opposed to short term growth alone), returning cash to shareholders,maintaining a fortress balance sheet, and leading on the environmental, social, andgovernance factors salient to the business.
Directors on the Board are annually elected by proxy from a pool of qualified candidates
and presented by the Nominating and Corporate Governance Committee and the full
Board of Directors. Company bylaws provide procedural rules and a timetable to allow
shareholders to nominate candidates. In 2022, Civitas made updates to its bylaws
to enhance shareholder voting rights and access. Notably, the company adopted amajority voting standard as well as “proxy access,” which allows certain stockholders tonominate directors.

Civitas places a high priority on attracting and retaining
the best talent from qualified, diverse backgrounds.

41 Governance

51 Appendix

CIVITAS BOARD OF
DIRECTORS COMPOSITION
8 INDEPENDENT
6 MALE
1 NON-INDEPENDENT 3 FEMALE

3 AGES 30-50 2 RACIAL/ETHNIC MINORITY
5 AGES 50 > 7 NON-MINORITYThe Civitas Board of Directors brings together a team of diverse and highly
qualified experts whose skills range from technical and financial expertise, oil and gas
and other relevant industry experience (e.g., familiarity with the Colorado politicallandscape, regulations, and operating procedures), sustainability as a means of
reducing long-term financial risk, and building an employee culture based on integrity.
Civitas places a high priority on attracting and retaining the best talent from
qualified, diverse backgrounds.
Civitas’ Board of Directors maintains a published target composition that includes
gender diversity of at least 30%. Civitas continues to advance its gender diversity
agenda, increasing the proportion of women Executives and Officers from 36% in
2021 to 43% in 2022.
The Board of Directors’ four committees — ESG, Audit, Compensation, andNominating and Corporate Governance — provide specialized oversight related to
specific matters within the company.

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ESG COMMITTEEThe ESG Committee oversees the company’s ESG strategy. The ESG
Committee is regularly updated on appropriate key performance
metrics, enabling the committee to effectively manage ongoing ESG
performance and monitor the progress of Civitas’ ESG goals and targets.
The ESG Committee works in concert with other Board committees
and acts as a critical resource to support Civitas’ executive team in thedevelopment and oversight of ESG processes, programs, policies, anddisclosures. The ESG Committee meets at least quarterly and has theauthority to raise business critical ESG issues in the interim.
The Chief Sustainability Officer (CSO), in coordination with the ESG
Committee Chair, leads Civitas’ sustainability strategy and is responsible
for setting the ESG agenda. The CSO reports out progress, risks, andopportunities to the management team on a weekly basis and meetsregularly with the ESG committee Chair to coordinate and prioritize
actions within the Committee’s jurisdiction.

The ESG Committee isalso responsible for:

Input on environment,
health, and safety topics

Oversight of charitableand philanthropic
activities

Oversight of practices
regarding diversity,
inclusion, and human andworkplace rights

Oversight of Public
policy advocacy efforts

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OUR EXECUTIVE LEADERSHIPEXECUTIVE OVERSIGHT
The executive management team brings deep technical, operational, financial,legal, government, regulatory, and community relations expertise, complementing
the contributions of Board committees that help ensure thoughtful, ethical, andprofessional governance. Civitas’ entire executive management team is committed
to ESG leadership in their respective elements of the business. The team consists of
the Chief Executive Officer, the Chief Operating Officer, the Chief Financial Officer,
the Chief Legal Officer and Secretary, the Chief Accounting Officer & Treasurer, theChief Sustainability Officer, the Senior Vice President of Asset Development, andthe Senior Vice President of Corporate Planning & Business Development.

41 Governance

51 Appendix

EXECUTIVE COMPENSATION
Consistent with Civitas’ commitment to ensure full alignment with shareholders,the executive leadership team’s compensation consists of annual salary andcompany stock (the majority in the form of performance stock units) anddoes not include cash bonuses. Equity awards are primarily tied to absoluteshareholder return, driving exceptional alignment and responsibility to investors.

PERCENTAGE OF COMPENSATION IN SHARES*
OF
79% BOARDDIRECTORS

100%

83% EXECUTIVETEAM

91% CEO

of Civitas employees receive
compensation in shares* Per Civitas’ latest proxy statement

ESG IN EMPLOYEE COMPENSATION

M. CHRIS DOYLE

HODGE WALKER

MARIANELLA FOSCHI

President and CEO

Chief Operating Officer

Chief Financial Officer

TRAVIS COUNTS
Chief Legal Officer &Secretary

Cash bonuses are awarded annually to non-executive employees and are basedon key performance indicators, including greenhouse gas intensity and safety,aligning employee incentives with certain of the company’s ESG goals. In
addition to the annual cash bonus, every Civitas employee is awarded equity in a
stock plan with a structured vesting schedule that aims to incentivize employee
retention and achieve further alignment with shareholders.

ESG-RELATED FINANCE MANAGEMENTSANDRA K. GARBISO
Chief Accounting Officer& Treasurer

BRIAN CAIN

BRAD JOHNSONBRIAN KUCK

Chief Sustainability
Officer

Senior Vice President,
Asset Management

Senior Vice President, Corporate
Planning & Business Development

Civitas seeks to incorporate critical ESG considerations into its financial
management, overseen by the Board. For example, the company calculates aninternal cost of carbon to evaluate capital and operational expenditures in termsof their relative potential to reduce carbon dioxide equivalent emissions per
dollar spent in the management of climate-related risks. The price incorporates
values such as the market cost of voluntary carbon credits, the cost of carbon
credits in global regulated markets, the published federal social cost of carbon,
and the intrinsic cost of carbon based on actual carbon-reduction projects
within Civitas.
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41 GovernanceThe company prioritizes the reduction of operational scopes 1 and 2 GHG emissions, with the purchase of voluntarycarbon credits or renewable energy certificates as a means of offsetting residual emissions. This creates a financial
incentive to invest in operational emissions reduction projects, and an internal culture focused on identifying
reduction opportunities. The cost of carbon serves as a hurdle rate, or an IRR lever, for evaluating projects for thegreatest emissions reduction impact. Projects with a lower cost of carbon emissions reduction per dollar spent areprioritized.
The TCFD framework informs how Civitas assesses climate risks. As part of Civitas’ financial carbon-related planning
efforts, the company developed multiple planning strategies based on various climate change scenarios, including
those based on actual end-of-year SEC pricing, the International Energy Administration’s (IEA’s) World Energy
Outlook (WEO) Stated Policies scenario, and Net Zero by 2050 (NZE). This exercise provides key data points basedon projected commodity costs to help inform the magnitude of risks in different climate scenarios.

RISK MANAGEMENT
Civitas’ Risk Management team is responsible for identifying, assessing, addressing, and monitoring risks.
Comprised of subject matter experts from across the company, this team reports to the Board and the Audit
Committee on a quarterly basis.
As underlined in the TCFD framework and related guidance, enterprise risks may include climate-related risks andopportunities, particularly those associated with legal, regulatory, environmental, and community implications. Proper
data measurement and analysis are crucial for mitigating these risks to the extent feasible while simultaneously
pursuing relevant opportunities across all climate scenarios.
The Risk Management Team:JOHN WREN

MARIANELLA FOSCHITRAVIS COUNTSJERRY VIGIL

SHEA KAUFFMAN

Director & Head of Planning,
Finance and Investor Relations

Chief Financial Officer

Chief Legal Officer
and Secretary

Director & Head ofInformation Technology

Deputy General Counsel

51 Appendix

OUR TOOLS
Civitas’ bespoke ESG dashboard
creates access and visibility
to important operational andenvironmental information thatprofessionals in the operations
and air quality departments
can respond to in real-time. The
ESG Metrics Dashboard allows
Civitas to be a considerably more
nimble company, facilitating
the identification of risks andopportunities in the nascentstages of their development.
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COMPLIANCE,
BUSINESSETHICS AND
PROFESSIONALCONDUCT
Civitas’ social license to operate is closely tied
to its ability to adhere to high standards inbusiness ethics and personal conduct, as well as
to maintain full compliance with all applicablelaws and regulations. Oversight of compliance,business ethics, and professional conduct

is managed at the Board level by the Audit

Committee and at the management level by thecompany’s executive team.

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51 Appendix

Civitas’ Code of Business Conduct and Ethics governs
the actions of employees and contractors. Agents,
suppliers, vendors, and contractors are expected toconform to standards set out in this code, as well as to
the Contractor Expectations Manual for Environmental,
Health, Safety, and Regulatory when working for oron behalf of the company. Additionally, violations ofdomestic or foreign laws, rules, and regulations may
subject an individual and the company to civil and/or
criminal penalties.
Civitas’ Chief Legal Officer and Secretary is responsible
for Code of Business Conduct and Ethics training anddistribution and updating the code with appropriate
approval from the Board to reflect changes in the law,company operations, and recognized best practices.
Upon employment and on an annual basis, all Civitas
employees receive training on Business Conduct
and Ethics as well as Insider Trading, after which
they certify that they have read and are familiar withthe corresponding policies. Civitas confirms a 100%
completion rate for these trainings in 2022.
Civitas published two additional policy disclosures in
2022, a Human Rights Policy and a Biodiversity Policy,
aligning with the company’s culture of ethics andcompliance.
Civitas’ Code of Business Conduct and Ethics, Insider
Trading Policy and Corporate Governance Guidelines
are subject to regular third-party audits. Sarbanes
Oxley audits are conducted annually and include
corruption and ethics assessments.

The company maintains a zero-tolerance policy for retaliation.

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51 Appendix

Transparency is central to Civitas’ internal culture of compliance. The company
maintains a Compliance Hotline, managed by an independent, third-party
vendor, to provide employees and contractors the ability to anonymously
communicate any concerns or issues with management.
The Chief Legal Officer and Secretary oversees this hotline and is the first toreview reports, which are provided directly to the Audit Committee Chair.
The Chief Legal Officer and Secretary identifies the appropriate first steps tomanage the issue and remains engaged through resolution to ensure a full,independent investigation is conducted.
Civitas contracted a third-party survey of all employees in March 2022, which
included questions evaluating their comfort level in expressing thoughts andconcerns with management. The results of this survey and every employee
survey are thoroughly analyzed and considered by leadership, with the goal of
implementing changes that improve employees’ experiences and ensure theirability to communicate important concerns to management.
External stakeholders and community members can report behavioral andethical violations. These reports are tracked to help ensure that they are
resolved on a timely basis and that the company is accountable to thecommunities in which it operates. Civitas’ commitment to ethical values entails
providing external contractors with access to an anonymous reporting systemthat allows them to report suspected misconduct or violations of the company’s
cultural values. Moreover, Civitas is committed to open communication with the
public at large and takes into consideration the perspectives of neighboring
communities as much as possible, beyond the public comment period andlandowner complaints.

CIVITAS | 2023 ESG REPORT 47

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29

MANAGEMENT OF
CONTRACTORS AND SUPPLIERS
Civitas works with a variety of contractors and subcontractors. The company requires

third-parties and suppliers to adopt Civitas’ Environmental, Health, and Safety (EH&S) standards

where company standards exceed those of the contractor to ensure alignment with the company’s

42 Governance

52
51 Appendix

The company requires contractors and suppliers
to adopt our standards:

Environmental

ESG objectives. Civitas uses an established supply chain management enterprise software forcontractor and supplier information management. Civitas evaluates contractors during the pre-qualification process by scoring contractor responses to a questionnaire and assessing compliancewith the company’s other pre-qualification requirements. The contractor’s resulting score enables
an evaluation of the contractor’s risk to Civitas.

HealthThe EH&S performance of contractors is field audited for conformance to Civitas’
requirements. The audit process begins with field observations and includes asummary presentation of the findings in a tabletop review. This is completed at aminimum annually and more frequently if needed or required.
Civitas’ service agreements require contractors and subcontractors to comply withstandards at least as stringent as the company’s Environmental, Safety and Regulatory
Compliance Manual or adopt the company’s standards. All contract employees who
work at a Civitas facility must complete training on the Contractor Expectations
Manual and maintain a record of completion for auditing and investigation
purposes. In the company’s Contractors Expectations Manual, Civitas conveys strict
expectations to meet or exceed compliance with all applicable federal, state, andlocal regulations. The information is meant to supplement contractors’ own policies
and protocols with expected requirements.

SafetyCIVITAS | 2023 ESG REPORT 48

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51 Appendix

CYBER SECURITY
Civitas’ remains committed to proactively managing the risks around IT and Cyber Security. Although
the company remains steadfast in its policies, programs, and trainings, Civitas knows that cybersecurity threats are always evolving. The Director and Head of Information Technology, in partnershipwith other senior IT department professionals, lead Civitas’ efforts to seek out best-in-classtechnology, talent, and cyber security practices that will proactively protect the organization. The IT
Department reports cyber security updates, perceived threats, potential risks, and opportunities tothe Board of Directors’ Audit Committee on a quarterly basis, or more frequently as required.

Civitas employees undergo IT and Cyber Security training, including internal
awareness engagements (such as phishing emails or click-bait) to reinforce behavior
that helps to minimize and mitigate potential risk. 97% of employees completed
assigned IT training in 2022. Civitas conducts a quarterly internal audit of its
policies and practices (including network penetration tests on company systems anddatabases) to help ensure the company is mitigating risk and driving improvement
where necessary. External auditors verify Incident Recovery Plans and internal
preparedness. These audits, evaluations of evolving current state systems, andfrequent trainings drive the effective application of security management.

Civitas maintains the following
policies to drive immediate,
effective responses to IT and
Cyber threats:

IT Security

Business
Continuity Plan

Disaster Recovery
PolicyIT Incident
Response andRecovery
CIVITAS | 2023 ESG REPORT 49

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POLITICAL ENGAGEMENT& REGULATORYPLANNING
Civitas maintains regular contact with appropriate local, state, andfederal regulators and applicable officeholders to help maintain a fullunderstanding of the regulatory landscape, and to lend expertise or
represent the company’s views in legislative and regulatory policy
formulation material to the business. Given the company’s sole focus
as a Colorado oil and gas producer, Civitas is proud to operate in ajurisdiction with among the most stringent oil and gas production
regulations in the country. These rules, enforced by agencies including
the Colorado Oil and Gas Conservation Commission (COGCC) andthe Colorado Department of Public Health and Environment (CDPHE),
ensure protection of public health, safety, welfare, the environment,
and wildlife resources, while also considering community input. Civitas
is committed to working with state regulators and local elected leaders
to help the state achieve its objectives, while maintaining an operable
environment for the company.

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51 Appendix

UPDATE ON COLORADO AIR QUALITY REGULATIONS

In late 2021, the Colorado Air
Quality Control Commission(AQCC) adopted new regulations
to reduce greenhouse gas
emissions and strengthen
methane monitoring from thestate’s oil and gas industry.

Operators must meet strict
emissions intensity targets, andsubmit plans by August 2023
on how they intend to reduce
emissions from operations.

Colorado methane intensity
targets for 2025 are roughly twice
as restrictive as those required by
the EPA for the rest of the nation.

MEMBERSHIPS AND ASSOCIATIONSEngaging with various trade associations as part of the company’s advocacy activities
allows Civitas to engage with peers and other companies to help develop unified
public policy agendas.

At Civitas, legislative and regulatory engagement is conducted inaccordance with all applicable laws and regulations. Disclosures offederal lobbying can be found at the website for the Office of the
Clerk for the U.S. House of Representatives, and state lobbying
disclosures are available at the Colorado Secretary of State website.
The government affairs and regulatory policy team reports directly
to the Chief Sustainability Officer to help ensure that political andgovernment affairs activities are fully aligned with the goals outlined in
the company’s ESG program.
CIVITAS | 2023 ESG REPORT 50

5

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29

APPENDIX

52

Governance

53

Strategy

55

Scenario Analysis

59

Risk Management

61

Oil & Gas Metrics tables

41 Governance
42

52 Appendix

As Colorado’s first carbon neutral oil and gas producer,
Civitas is dedicated to managing climate impact byreducing its scope 1 and 2 GHG emissions, as a firstpriority, and the offsetting residual emissions. Civitas
believes that having a strong sustainability platform
supports its efforts to properly manage climate risks
while meeting demand for oil and natural gas at a lower
carbon footprint than peers.
CIVITAS | 2023 ESG REPORT 51

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51 Appendix

GOVERNANCE

BOARD OF DIRECTORS’ ROLE IN ASSESSING& MANAGING CLIMATE RISKS
Civitas has established an ESG Committee within the company’s Board of Directors. This
governing body is tasked with generating internal metrics and overseeing compliance withcorporate climate objectives, commitments, and ongoing performance. The Committee
functions in concert with the other Board committees and relies on a specialized team oftechnical, policy, and compliance advisors to support them. The ESG Committee meets atleast quarterly with the Board and has the authority to raise business critical ESG issues in theintervening time. The ESG Committee is responsible for overseeing and mitigating climaterelated risks to the extent feasible, as well as pursuing relevant opportunities across all climate
scenarios. The identified climate-related risks and opportunities act as a starting point for
Civitas to evaluate and manage going forward.

MANAGEMENT’S ROLE IN ASSESSING& MANAGING CLIMATE RISKS
Climate-related responsibilities are overseen by the Chief Sustainability Officer,
who reports directly to the CEO. The Chief Sustainability Officer meets regularly
with the Chair of the Board’s ESG Committee. The Chief Sustainability Officer
is charged with reporting on climate issues weekly to the full management
team. As such, the Chief Sustainability Officer has oversight over the relevant
departments and personnel who report on climate risks. These include the
Director of Sustainability and Decarbonization, a role tasked with overseeing
progress on GHG goals and managing the carbon credit and renewable energy
certificate portfolio, as well as the Manager of Public Affairs, a role tasked withidentifying impending energy policy, legislation, and regulation affecting GHG
emissions and climate issues.
CIVITAS | 2023 ESG REPORT 52

STRATEGY
CLIMATE-RELATEDRISKS & OPPORTUNITIESCivitas works to integrate its responsibility to act
as an environmental steward is integrated across its
broader business strategy. As such, the company
monitors the potential impact of salient climaterelated risks on its operations, which helps it tomitigate transition risks, including those associatedwith stranded assets, over longer time horizons.
Civitas has identified the following relevant transition
risks — affecting policy, technology, market supply
and demand, and reputation — as well as physicalclimate-related risks,11 among others. The company isengaged in discussions around long-term and shortterm strategies to manage scope 1 and 2 emissions,emissions reduction targets, and performance against
those targets.

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TRANSITION RISKS

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PHYSICAL RISKS

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51 Appendix

Policy & Legal

Emerging Technology

Increasingly stringent regulations
could reduce profitability as
additional emissions reduction
requirements are adopted. If
a regulated price on carbon is
instituted, the additional cost
could be borne more or less by
exploration and production (E&P)
operators, depending on where in
the value chain the fee is collected.

As utilities continue to increase theproportion of renewable energy intheir fuel mix, system reliability could
be impacted. The effort to retrofit andoverhaul Civitas facilities with lowemission technology could be costly andtime-consuming. Operational reliabilityof new technologies is yet to be proven.

Market – Supply &Demand:An imbalance between
the supply and demand
dynamics of fossil fuels
could decrease the priceof oil and/or natural gas,potentially resulting inlower company revenue.

Acute

Chronic

Climate change has left the Western states vulnerable to prolonged
wildfire seasons and reduced air quality. A prolonged wildfire season
could lead to an increase in “voluntary emission reduction days” andcould also result in more restrictive federal nonattainment designations
throughout the Front Range.

More severe droughts could
lead to a decline in the amountof available water necessary to
perform these operations.

11
For more information on our approach to climate-related risk
identification, please see Civitas’ most recent 10-K filing.

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STRATEGYOPPORTUNITIESCLIMATE-RELATEDRISKS & OPPORTUNITIES

41 Governance

51 Appendix

Policy & Legal

Emerging Technology

With increasingly stringent
requirements, higher-emitting
companies may be forced tosell assets. A price on carbon
could make the costs of businesscomparatively more expensive forhigher-emitting companies thanfor lower-emitting ones. Civitas
believes it has a relatively low
operational GHG intensity within
our industry, and therefore may
have the opportunity to acquire
assets and implement emissionssaving measures to remain below
regulated emissions targets.

» Economics of the production of renewable energy will likely continue toimprove. Civitas strives to develop and deliver solar energy and help Colorado
meet its renewable energy goals.

Market Supply & Demand» Demand for fossil fuels is strong
and we expect will remain so overthe short-term. A transition to alower-carbon energy economy
will likely require continued useof oil and natural gas for utility
power generation and in thematerials supply chain. Civitas
believes it is prepared to safely andresponsibly produce oil and natural
gas resources to meet customer
demand for energy and chemical
feedstocks.
» Emerging renewable energy will
likely be more broadly available.
Low-cost renewable energy could
be used to power Civitas facilities
where feasible. The company
plans to continue exploring thedevelopment of renewables, suchas community solar.

» The electric vehicle market will likely create additional electricity demand for
utilities. Civitas plans to help to meet the additional demands of EV charging by
providing certified RSG to utilities.
» Equipment such as air-operated pneumatic devices, electric compressors, andpumps help reduce the company’s emission profile. New methane detection
equipment enables more effective leak detection and repair programs. Civitas
plans to pilot different emissions-reduction technologies to find the most effective
and cost-efficient solutions that enable the company to retain its social license tooperate in Colorado and leadership position among peers.
» Continued deployment of newer fracturing fleets, especially near line-power,
could result in lower scope 1 GHG emissions. Civitas is actively pursuingelectrification of drilling and fracturing fleets using line-power and highefficiency onsite generation.

Reputation

Acute Physical Conditions

Civitas has an opportunity to bea leader in sustainability amongindustry peers by proactively
addressing climate change andmitigating its effects. By beinga responsible operator withproactive emissions reduction
policies, Civitas could realize acompetitive advantage among
investors in a changing industry
landscape. By operating ESGaccretive assets, the company
is positioned to optimize
the value of its portfolio
and demonstrate a genuine
commitment to ESG leadership.

Grid-electrification of drilling rigs and production
facilities, tankless and closed-loop facility designs,
and other emissions-reduction measures canprovide a hedge against a more restrictive air
permitting and operational environment. Civitas
plans to explore the potential to certify highefficiency, lower emitting sites to assure stableproduction of responsibly sourced energy.

Chronic
Water re-use is an area of potential leadershipthat can demonstrate responsible use ofresources and establish Civitas as an advocate ofwater conservation among peers. Civitas plans
to look for partners that can support a water
re-use supply chain and other creative water
CIVITAS | 2023 ESG REPORT 54
conservation opportunities.

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SCENARIO ANALYSISTO INFORM THE
COMPANY’S
STRATEGIC
THINKING ON
CLIMATE-RELATEDRISKS ANDOPPORTUNITIES

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51 Appendix

Civitas’ strategy development is guided by a scenario analysis of long-term trends and developments
in energy markets, which helps the company assess its position relative to climate-related risks andopportunities. The company’s climate scenarios are based on publicly available scenarios developed by theInternational Energy Agency’s (IEA) World Energy Outlook (WEO) 2022. The WEO 2022 selected scenarios
consist of 1) the Stated Policies Scenario (STEPS) and 2) the Net Zero Energy by 2050 (NZE), which each
assume different sets of changes in policy, technology, market demand, and energy efficiency through 2050.
Population growth and economic growth are kept consistent between both scenarios.
The Colorado Department of Health and Environment has released several new rulemakings that impact
oil and gas operations. Recent updates include more stringent record-keeping and reporting requirements,
GHG intensity rulemakings, retrofit of natural gas pneumatic controllers at facilities, and a probable EPA redesignation of the Denver Metro North Front Range area from an ozone “serious” non-attainment area to“severe” in 2022. Federal regulations often lag Colorado but are becoming more stringent with a focus on
methane emissions reductions and GHG reductions.
In terms of emerging technology, all scenarios assume that methane-monitoring and emission-reduction
technologies continue to evolve and proliferate with a focus on continuous ambient air emissions
monitoring with immediate intervention. It is also accepted that newer hydraulic fracturing equipment andtechnology will continue to improve, becoming more efficient and lower-emitting.
For chronic physical risks, the Intergovernmental Panel on Climate Change’s (IPCC) latest report (2022)
states with “high confidence” that “climate extremes are causing economic and societal impacts
across national boundaries through supply-chains, markets, and natural resource flows, with increasingtransboundary risks projected across the water, energy, and food sectors.” Central North America will beaffected by severe droughts even if global warming stabilizes between 1.5-2°C. This is considered across all
scenarios as well. The potential for more intense and prevalent fire seasons is also increased, which carries
the risk of actual fire impacts on sites as well as the hazards associated with smoke exposure and impaired
air quality.

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The following climate scenarios are used to evaluate Civitas’ climate-related risks and opportunities that come withthe transition to a lower carbon economy:
The 2022 Actual Observations are the actual observations for Civitas. This information comports to reserve pricing and
SEC corporate filings as of year-end 2022. Civitas believes that 2022 represented a more typical year than in respect tosupply and demand 2021. This enabled Civitas to look at a greater disparity from what higher-priced oil would entail
versus the lower-priced scenarios that resembled the actuals from a couple years prior in 2020. Actual crude oil prices
were $78.07/Bbl (WTI), and natural gas prices were $5.53/MMBtu (HH) on December 31, 2021.

Policy & Legal

Emerging Technology

Market – Supply & Demand

In this scenario, the US Government’ssocial cost of carbon (SCC) in early2021 was set to an average central casevalue of $51/tonne CO² dependent
on the assumed discount rate per
Executive Order 13990. Multiple legal
cases regarding the ability of the EPA
to regulate carbon emissions are either
pending or have been resolved without
any overarching direct for any party,
outside the federal government, toutilize the SCC.

The levelized cost of energy for utility
scale solar and wind power continues tobe cost-competitive with conventionally
fueled power globally and in the U.S. In
addition, the 2022 global market sharefor EVs rose from 9% of sales to 14%.

2022 saw a significant increase in crude
oil prices in the first half of the year
before declining during the latter halfof the year. According to the EIA, crude
oil prices increased due to geopoliticaltensions between Russia and Ukraine.
With Russia’s invasion in early Marchcoupled with low global crude oilinventories, crude oil prices rose to thehighest inflation-adjusted price since2014. Beginning in June, crude oil
prices decreased as concerns about apossible economic recession dampened
consumer demand. Natural gas prices
trended upwards from February toAugust due to weather-related demand.
By the late third quarter, high natural gas
production had led natural gas prices toan annual low in November.

51 Appendix

CRUDE OIL & NATURALGAS PRICE 2022 ACTUALOBSERVATIONS

$7807

$0553

PER BARRELPER MMBTU

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The Stated Policies scenario (STEPS) [WEO-2022] reflects how energy systems evolve if current policy settings are
retained and completed. In this scenario, crude oil could cost $95 per barrel and natural gas in the U.S. could cost $4.70
per MMBtu by 2050 (in 2022 USD).

Policy & Legal

Emerging Technology

Market – Supply & DemandThis scenario assumes Canada, Chile,
China, the EU, Korea and South Africa
have some regulated carbon pricing
frameworks ranging from $13-$113/
tonne CO² by 2050. Actual observations
have shown the regulated cost ofcarbon in Europe crossing the $80/tonne
threshold for most of 2022, with thehighest carbon price at $106 in August.

It is estimated that there will beapproximately 3,492 TWh of solar
energy production globally by 2030, a
319% increase from 2020, and 9,667
TWh by 2050. EVs could account for
30% of all road vehicle sales, seventimes larger than today. The annual
average growth rate of EVs is expected
to be nearly 30% over the next decade,with Europe and China leading global
EV markets.

Economic growth to 2030 is moresluggish than previously projected,
leading to lower energy demand growth.
In this scenario, primary energy demandis expected to increase by 1% eachyear until 2030 and be resolved throughthe expansion of renewables. Demand
for fossil fuels remains steady through2030, then slightly decreases until 2050
as IEA crude oil costs reach $95/barrel
in 2050. Global renewables will accountfor 43% of electricity generation by
2030 and 65% by 2050, up from 28%
today. By 2050, natural gas production is
projected to increase by 5.0%, while oil
production will grow by 10.3%.

51 Appendix

OIL & NATURAL GASPRICES IEA WORLD ENERGYOUTLOOK STATED POLICIESSCENARIO — 2050 PROJECTION

$9500
$0470

PER BARRELPER MMBTU

CIVITAS | 2023 ESG REPORT 57

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The Net Zero Emissions by 2050 (NZE) scenario [WEO-2022] identifies desired future outcomes, including capping
global warming to 1.5 degrees Celsius, and then maps the steps needed to establish incremental goals. In order toreach these goals given the current trajectory of emissions, this scenario calls for a reduction in fossil fuel consumption and
U.S. prices of $24/barrel of crude oil and $1.80/MMBtu of natural gas by 2050.

Policy & Legal

Emerging Technology

Market – Supply & Demand

Under this scenario, it is assumed that alladvanced economies have establishedregulatory CO2 pricing frameworks, aswell as emerging economies with net
zero emissions pledges, with prices
increasing to an estimated $250/tonne &$200/tonne, respectively, by 2050. CO2
prices are projected to rise more slowly
in other emerging markets as theytransform energy systems.

This scenario requires a significant
investment in clean energy, increasingfrom 2% of GDP in 2021 to 4% in 2030.
Electricity generation from renewables
spending will increase by 233%, totaling
USD 1.3 trillion in this same timeframe.
Clean energy technology will facepressures to scale up to meet the levelof battery demand underpinning the
NZE scenario. By 2030, 60% of global
car sales will be electric and by 2035,
internal combustion engine (ICE) cars
will no longer be manufactured and sold.
Aviation will pursue decarbonization
technology quickly as the share ofsustainable aviation fuel rises from 10%
in 2030 to 70% in 2050.

Supply and Demand: The global energy
mix experiences a transformation as
unabated energy is supplanted by lowemission sources sector-wide. Between
2021 and 2050, oil will decline by 80%
and natural gas will decline by more than
70%. This is paralleled by patterns inenergy consumption, which decreases
10% from 2021 levels to 2030, even as
GDP increases. Hydrogen-based fuels
gain traction after 2030 and will accountfor 10% of energy consumption by 2050.

51 Appendix

OIL & NATURAL GAS PRICESIEA WEO NZE SCENARIO —2050 PROJECTIONS

$2400
$0180

PER BARRELPER MMBTU

CIVITAS | 2023 ESG REPORT 58

03 Introduction

12 EnvironmentRISK
MANAGEMENT

CLIMATE RISK ASSESSMENT
Civitas produces an annual Climate-Related Risk andOpportunity Report, which includes scenario analysis,climate related-risk and opportunity analysis, andcorresponding response measures. The climate-relatedrisks and opportunities identified act as a starting point
for Civitas to evaluate, identify, and manage our risks
and opportunities going forward. The ESG Committee
is responsible for actively identifying and overseeing
strategies to mitigate these risks to the extent feasible,
as well as pursuing relevant opportunities across all
climate scenarios.

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41 Governance

51 Appendix

CLIMATE RISK ASSESSMENT

and operational expenditures and consider potential climate
legislation. By working to proactively reduce emissions andsetting an internal price of carbon, Civitas is focused onstaying ahead of regulations.

Civitas’ commitment to rigorous evaluation andmitigation of evolving issues has led Civitas to annuallyreview certain potential risks related to natural disasters,
pandemics, legislation, social, political, and regulatory
impacts, as well as competitive or technologicaldisplacements. In response to this investigation, Civitas
has developed the following risk mitigation responses
as part of its comprehensive response strategy:

In terms of emerging technology, Civitas will strive toposition itself as a leader in providing lower carbon, certified
RSG to utilities as a baseload fuel source. Civitas plans to
explore new opportunities to third-party certified Responsibly
Sourced Gas and feedstocks for utility customers and end
users. Any new facilities built in Colorado from 2020 on are
required by Colorado regulations to operate with electricdriven or instrument air pneumatic controllers. Goingforward, all new Civitas facilities are required to be equippedwith ambient air monitoring technology during pre- and early
production activities. Civitas plans to continue to proactively
source more efficient fracturing fleets. New technologies
are thoroughly vetted on a small scale before committing tolarger financial commitments.

Civitas allocates budget to projects that are designed togenerate meaningful returns for shareholders in a mannerconsistent with a commitment to safe and responsible
operations within communities. This commitment extends to
the global community, with a focus on investing in proactive
emissions-reduction measures that, in some cases, exceed
current regulatory requirements and are believed to have thegreatest ability to mitigate future risks. By calculating costsof carbon and selecting cost-efficient emissions-reduction
projects, Civitas seeks to strategically identify technologies
and process improvements that build and maintain high value
operations under a variety of climate regulatory scenarios.
Civitas takes into consideration current climate regulations
with an eye toward anticipated climate legislation. Civitas
believes an emissions reduction strategy moderates theimpacts of expanding climate change regulation and createsa competitive advantage. For demand fluctuations associatedwith climate change regulations, an emissions reduction
strategy allows for moderation of impacts and potentiallyfor Civitas to leverage competitive advantages due to acarbon leadership position. Civitas maintains calculations
based on an internal price of carbon to inform both capital

In response to a potential imbalance between fossil fuelsupply and demand, contracts are structured to scale work
activity to match demand and potentially renegotiate vendor
costs in certain circumstances. Civitas is constantly analyzing
market conditions and periodically uses commodity pricehedging to cover a portion of production.
In response to acute physical risks, Civitas plans to continue
exploring facility design innovations and other emissionreduction technologies that enable continued operations ina more restrictive air permitting environment. As for chronic
physical risks, Civitas uses recycled produced water as asupplemental source for hydraulic fracturing operations,where feasible and appropriate. The company is also
committed to identifying opportunities to use gray water andother non-potable sources.
CIVITAS | 2023 ESG REPORT 59

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51 Appendix

INTEGRATION INTO OVERALLRISK MANAGEMENT
Acute and chronic climate risks such as the likelihood of
wildfire, increased heat, and drought all pose significant
risks to operations. These topics are integrated into
safety protocols for training and response and updated
based on the current understanding of the risks posed.

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OIL & GAS

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51 Appendix

Exploration and Production
The following table references the specific “Oil & Gas — Exploration and Production” SASB industry standard and AXPC standard for quantitativeand qualitative data. All information is presented for historical reference and is subject to future revisions and adjustments as appropriate. The
data presented here represents a point-in-time snapshot of Civitas’ performance for the 2022 calendar year. From time to time Civitas may at its
discretion provide additional and updated data on the Civitas website.

DESCRIPTIONUNIT OF MEASURE

SASB CODEC O N S O L I DAT E D C I V I TA SRESPONSE (2022)

AXPC

G R E E N H O U S E G A S E M I SS I O N S
Gross Global scope 1 GHG Emissions12

Metric tons CO2e

EM-EP-110a.1

AXPC

1,250,800

Percentage Methane

Percentage (%)

EM-EP-110a.1

--

43%

Percentage Covered Under Emissions-Limiting Regulation

Percentage (%)

EM-EP-110a.1

--

100%

Gross Global scope 1 Emissions

--

--

--

Flared Hydrocarbons

Metric tons CO2e

EM-EP-110a.2--

56,779Other Combustion

Metric tons CO2e

EM-EP-110a.2--

668,593

Process Emissions

Metric tons CO2e

EM-EP-110a.2

--

1,121

Other Vented Emissions

Metric tons CO2e

EM-EP-110a.2--

519,996

Fugitive Emissions

Metric tons CO2e

EM-EP-110a.2

--

4,312

Scope 1 GHG Intensity Rate

Metric tons CO2e / MBOE

--

--

14.5

Gross scope 2 GHG Emissions (market-based)13

Metric tons CO2e----

73,869Total scope 1 and 2 Emissions

Metric tons CO2e----

1,323,568

Total Electricity Consumed

MWh

N/A

--

143,080

Methane Emissions

Metric tons CH4

--

AXPC

21,530Methane Intensity

Metric tons CH4 / Gross Annual
Production (MBoe)

--

AXPC

0.228

Percentage of GHG Emissions Attributed to Boosting andGathering Segment

Percentage (%)

--

AXPC

7%

Percentage of Methane Emissions Attributed to Boosting andGathering Segment

Percentage (%)

--

AXPC

1%

Gross Annual Volume of Flared Gas

Mcf

--

AXPC

10,475Percentage of Gas Flared Per Mcf of Gas Produced%, Gross Annual Volume of Flared Gas (Mcf) / Gross Annual
Gas Production (Mcf)

--

AXPC

0.005%

Volume of Gas Flared Per Barrel of Oil Equivalent Produced

Gross Annual Volume of Flared Gas (Mcf)/ Gross Annual Production (Boe)

--

AXPC

0.0001

12
13

Scope 1 emissions match what was reported under subpart W for the EPA Greenhouse Gas Reporting Program.
Market-based emission factors for Xcel Energy only using published emission factors, other use location-based factors.

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DESCRIPTION

41 Governance

UNIT OF MEASURE

SASB CODE

51 Appendix
C O N S O L I DAT E D C I V I TA SRESPONSE (2022)

AXPC

AIR QUALITY2Air Emissions NOx (Excluding N2O)14

Tons

EM-EP-120a.1

--

5,117

Air Emissions SOx3

Tons

EM-EP-120a.1--

0

Air Emissions Volatile Organic Compounds14

Tons

EM-EP-120a.1

--

5,815

Air Emissions Particulate Matter

Tons

EM-EP-120a.1--

Not required for Colorado Emissions Inventory.
Comprehensive inventory not maintained.

AXPC

0.007

SPILLS
Produced Liquids Spilled(Bbl)/Total Produced Liquids (MBbl)

Spill intensity--

WAT E R M A N AG E M E N T
14Total Freshwater Withdrawn

3

Thousand cubic meters (m )EM-EP-140a.1--

10,745,400

Total Freshwater Consumed14

Thousand cubic meters (m3)

EM-EP-140a.1--

10,745,400

Percentage of Freshwater in Regions with High or ExtremelyHigh Baseline Water Stress

Percentage (%)

EM-EP-140a.1

--

100

Volume of Produced Water and Flowback generated12

Thousand cubic meters (m³)

EM-EP-140a.2

--

2,377

Percentage Discharged

Percentage (%)

EM-EP-140a.2--0Percentage Injected

Percentage (%)

EM-EP-140a.2

--

100

Percentage Recycled

Percentage (%)

EM-EP-140a.2--

0Hydrocarbon Content in Discharged Water

Metric tons (t)EM-EP-140a.2--

N/A (no discharge)

Percentage of Hydraulically Fractured Wells for Which There is
Public Disclosure of All Fracturing Fluid Chemicals Used

Percentage (%)

EM-EP-140a.3

--

100

Percentage of Hydraulic Fracturing Sites Where Ground or
Surface Water Quality Deteriorated Compared to a Baseline

Percentage (%)

EM-EP-140a.4--

There were no cases where the deterioration of
surface water quality was identified as having comefrom oil and gas development.

Freshwater Intensity

Freshwater consumed (Bbl) / Gross
Annual Production (Boe)

--

AXPC

0.8

Water Recycle Rate

Recycled Water (Bbl) / Total Water
Consumed (Bbl)

--

AXPC

0

Does your company use WRI Aqueduct, GEMI, Water Risk Filter,
Water Risk Monetizer, or other comparable tool or methodology
to determine the water stressed areas in your portfolio?

Description / Analysis

--

AXPC

YES

14

Colorado Emissions Inventory values will be reported in July 2023.

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DESCRIPTIONUNIT OF MEASURE

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51 Appendix

C O N S O L I DAT E D C I V I TA SRESPONSE (2022)

AXPC

BIODIVERSITY
Number of hydrocarbon spills

Number

EM-EP-160a.2--

24

Aggregate volume of hydrocarbon spills

Barrels (bbls)

EM-EP-160a.2

--

198

Hydrocarbon spill volume in Arctic

Barrels (bbls)

EM-EP-160a.2--

0Hydrocarbon spill volume impacting shorelines with ESI
rankings 8-10

Barrels (bbls)

EM-EP-160a.2--

0Hydrocarbon spill volume recovered

Barrels (bbls)

EM-EP-160a.2

--

5.5

Percentage of (1) proved and (2) probable reserves in or nearsites with protected conservation status or endangered species
habitatPercentage (%)

EM-EP-160a.3

--

100

SECURITY AND HUMAN RIGHTS
Percentage of (1) proved and (2) probable reserves in or nearareas of conflict15

Percentage (%)

EM-EP-210a.1--

0Percentage of (1) proved and (2) probable reserves in or near
indigenous land16

Percentage (%)

EM-EP-210a.2

--

0

--

0

C O M M U N I T Y R E L AT I O N S
Number and duration of non-technical delays15

15
16

Number, days

EM-EP-210b.2

Civitas does not disclose information on their probable reserves.
Civitas complies with the voluntary ozone reduction measures stipulated in operating agreements for designated high-ozone advisories, of which at least 30 such advisories (in some cases over multiple days) were complied with in 2022.

To see Civitas’ 2020 and 2021 performance indicators, please visit the 2022 Corporate Sustainability Report and 2020 ESG Scorecard.

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SASB CODEC O N S O L I DAT E D C I V I TA SRESPONSE (2022)

AXPC

W O R K F O R C E H E A LT H A N D S A F E T Y
Total Recordable Incident Rate (TRIR) for Full-Time Employees

Rate, Hours (h)EM-EP-320a.1

AXPC

0.31

Total Recordable Incident Rate (TRIR) for Contract Employees

Rate, Hours (h)EM-EP-320a.1

AXPC

0.25

Total Recordable Incident Rate (TRIR) for Both Full-Time andContract Employees

Rate, Hours (h)EM-EP-320a.1

AXPC

0.26

Fatality Rate

Rate, Hours (h)EM-EP-320a.1--

0

Near Miss Frequency Rate (NMFR)

Rate, Hours (h)EM-EP-320a.1--

Incomplete data set, tracking began 2H22

Average Hours of Health, Safety, and Emergency Response
Training for Full-Time Employees

Rate

EM-EP-320a.1--

22

Average Hours of Health, Safety, and Emergency Response
Training for Contract Employees

Rate

EM-EP-320a.1--

22

R E S E R V E S VA LU AT I O N A N D C A P I TA L E X P E N D I T U R E S
Sensitivity of hydrocarbon reserve levels to future priceprojection scenarios that account for a price on carbon
emissions18,19

Million barrels (MMbbls), Million standard
EM-EP-420a.1
cubic feet (MMscf)--

See Below Table“Net Proved Reserves”

Estimated carbon dioxide emissions embedded in provedhydrocarbon reserves18

Metric tons CO2e

EM-EP-420a.2--

40,173,448

Amount invested in renewable energy, revenue generated byrenewable energy sales

US dollar ($)

EM-EP-420a.3

--

0

--

0

--

N/A, PSE rates are not currently tracked

B U S I N E SS E T H I C S
Percentage of (1) Proved and (2) Probable Reserves in Countries
That Have the 20 Lowest Rankings in Transparency International’s
Corruption Perception Index19

Percentage (%)

EM-EP-510a.1

C R I T I C A L I N C I D E N T R I S K M A N AG E M E N T
Process Safety Event (PSE) rates for Loss of Primary Containment(LOPC) of greater consequence (Tier 1)

Rate

EM-EP-540a.1

NET PROVED RESERVES
Civitas complies with the voluntary ozone reduction measures stipulated in operating 			agreements for designated high-ozone advisories, of which at least 30 such advisories (in somecases over multiple days) were complied with in 2022.
18
Proved reserves under 2022 Actual scenarios are based on SEC respective year end reports.
19
Civitas does not disclose information on their probable reserves.
17

SCENARIOSOIL (MMBBLS)N AT U R A L G A S( M MS C F )NGL (MMBBLS)

2022 Actuals

153

868

119

Stated Policies

151

856

117

NZE by 2050

117

634

87

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UNIT OF MEASURE

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51 Appendix

C O N S O L I DAT E D C I V I TA SRESPONSE (2022)

AXPC

AC T I V I T Y M E T R I C S
Annual Employee Workhours

Number--AXPC

650,887

Annual Contractor Workhours20

Number--AXPC

11,112,242

Annual Combined Workhours

Number--AXPC

11,763,129

Gross Annual Oil production

Bbl

--

AXPC

56,648,096

Gross Annual Gas production

Mcf

--

AXPC

179,410,241

Gross Annual Production

As reported under Subpart W (Mboe)

--

AXPC

86,549,802

Total Produced Liquids

MBbl

--

AXPC

86,565

Produced Liquids Spilled

Bbl

--

AXPC

680

Freshwater Consumed

Bbl

--

AXPC

67,586,534

Recycled Water

Bbl

--

AXPC

0

Total Water Consumed

Bbl

--

AXPC

67,586,534

Employee OSHA Recordable Cases

Number

--

AXPC

1

Contractor OSHA Recordable Cases

Number

--

AXPC

10

Combined OSHA Recordable Cases

Number

--

AXPC

11

Production of Oil

Thousands of barrels per day (Mbbl/day)

EM-EP-000.A

--

15521

Production of Natural Gas

Million standard cubic feet per day

EM-EP-000.A

--

620

Production of Synthetic Oil

Thousands of barrels per day (Mbbl/day)

EM-EP-000.A--0

Production of Synthetic Gas

Million standard cubic feet per day

EM-EP-000.A--

0

Number of Offshore Sites

Number

EM-EP-000.B--

0

Number of Terrestrial Sites22

Number of active wells

EM-EP-000.C

--

3,261

20
21
22

Contractor workhours are estimated by the controller using API spend-based method.
110 Mbbl/day oil production, 45 MBOE/day NGL production.
Number of active wells as reported to the EPA under Subpart W.

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UNIT OF MEASURE

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51 AppendixAXPC

C O N S O L I DAT E D C I V I TA SRESPONSE (2022)

Q U A L I TAT I V E FAC T O R S
GHG Emissions
Discussion of long-term and short-term strategy or plan to
manage scope 1 emissions, emissions reduction targets, and ananalysis of performance against those targets

Qualitative

EM-EP-110a.3--

Managing Environmental Risks &Opportunities--

Spill Prevention & Asset Management
Biodiversity & Ecosystems
Waste Management

Biodiversity Impacts
Description of environmental management policies and practices
Qualitative
for active sites

EM-EP-160a.1

Security, Human Rights and Rights of Indigenous Peoples
Discussion of engagement processes and due diligencepractices with respect to human rights, indigenous rights, andoperation in areas of conflict

Qualitative

EM-EP-210a.3--

Human Rights--

Community Engagement & Volunteering--

HSE Programs & Training--

Climate Risk Management: TCFD Reporting--

Compliance, Business Ethics & Professional
Conduct--

Political Engagement & Regulatory Planning--

Risk Management

Community Relations
Discussion of process to manage risks and opportunities
associated with community rights and interests

Qualitative

EM-EP-210b.1
Workforce Health and Safety

Discussion of management systems used to integrate a culture of
Qualitative
safety throughout the exploration and production lifecycle

EM-EP-320a.2
Reserves Valuation and Capital Expenditures

Discussion of how price and demand for hydrocarbons and/or
climate regulation influence the capital expenditure strategy for
exploration, acquisition, and development of assets

Qualitative

EM-EP-420a.4
Business Ethics and Transparency

Description of the management
system for prevention of corruption
and bribery throughout the value chain

Qualitative

EM-EP-510a.2
Management of Legal and Regulatory Environment

Discussion of corporate positions related to government
regulations and/or policy proposals that address environmental
and social factors affecting the industry

Qualitative

EM-EP-530a.1
Critical Incident Risk Management

Description of management systems used to identify andmitigate catastrophic and tail-end risks

Qualitative

EM-EP-540a.2

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CIVITAS | 2023 ESG REPORT 67