# DEAR FELLOW SHAREHOLDERS

_Source: `DeepSeekOCR_Ardian_pruned_1k/energy-oil-gas-e-p/NYSE_RRC_2019/NYSE_RRC_2019.mmd` · pages 1-7_

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DEAR FELLOW SHAREHOLDERS

Although 2019 was another year of significant challenges for our Company due to the oversupply of natural gas and resulting commodity price environment, over the course of the year we made steady progress on key objectives that we believe will carry long-term benefits. Results for full-year 2019 reflect Range's focus and ability to deliver on financial and operating objectives that are within our control.

Operationally, the flagship asset and focus of the Company has been and will continue to be our large, high-quality, de-risked inventory in southwestern Pennsylvania. A year ago, we discussed our view that the industry has entered a new era of shale development, where companies that have captured the most prolific resources can generate compelling long-term returns for their shareholders. We believe the quality of Range's assets and our relentless focus on margins will allow us to improve corporate returns and reduce debt over time. Consistent with prior periods, Range's operating efficiency and close attention to capital discipline delivered planned production with capital investment lower than budget, while continuing to drive down unit costs.

During 2019, Range achieved its planned production level of 2.28 Bcfe per day with a capital investment of \(728 million for the year. As a result of thoughtful planning, efficient operations, and a laser focus on capital discipline, our team was able to deliver the 2019 operational plan for \)28 million less than originally budgeted. It marks the second consecutive year Range has achieved these types of operational savings, and reflects our commitment to disciplined capital investment as a core principle. As a result, we believe Range was the most efficient natural gas producer in the country as measured by total well costs per lateral foot and capital investment per unit of production during the year.

Range achieved the longest average lateral program in the Company's history in 2019 at 11,200 feet, and in the process realized new operational efficiency levels with average daily lateral footage drilled increasing significantly year-over-year. In addition to improving efficiencies, the Range team continued testing a natural-gas-fueled electric fracturing fleet which resulted in contracting that fleet starting in the fourth quarter. Utilizing this technology versus a conventional fleet results in a significant reduction in emissions while also reducing noise levels during the completion process. The availability of this environmentally friendly, cost-effective solution stems from the ability to fuel our operations with clean-burning natural gas from existing pads. We see this as a significant "win" on several fronts, and as great progress toward achieving our environmental objectives. Additionally, Range's water recycling program continues to reduce costs and care for water resources in Appalachia. In addition to recycling 100% of Range's water in Pennsylvania, we are also recycling other producers' water, which totaled almost 200 million gallons in 2019, reducing our completion costs by more than $10 million for the year and lowering our freshwater usage dramatically.

Since discovering the Marcellus, Range has thoughtfully created a diversified portfolio of sales points, including in-basin opportunities, which has been an important factor in managing our cost structure. While the production trajectory of the industry has changed, Range has maintained flexibility and managed costs by aligning our infrastructure arrangements with our production profile. For context, at the end of 2019, Range was producing gross natural gas volumes approximately 10% above our firm transportation commitments in Appalachia. The thoughtful planning from more than five years ago has given Range a differentiated ability to manage our cost structure and provide flexibility with changing commodity price environments.

We delivered on the forecasted trend of improving unit costs over the course of 2019, reducing these expenses by 12% by the end of the year. In the fourth quarter, Range achieved all-in cash costs of \(1.92 per unit of production, including lower direct operating expenses, gathering, processing & transportation (GP&T), G&A, and interest expense. The steady improvement throughout the year was primarily driven by a reduction in GP&T through the efficient use and full utilization of our infrastructure in southwestern Pennsylvania. Direct operating expenses continue to benefit from efficient water handling and the sale of non-core legacy properties. G&A has been reduced through both asset sales and staffing reductions, with full-time employee headcount reduced 18% this year. Annual cash interest expense was also reduced by \)19 million due to a lower debt balance. It's important to point out that these unit cost reductions drive lasting enhancements to margins and cash flow that do not require a change in the commodity price. Over time, we expect the downward trend in cash unit costs to continue, and we remain focused on becoming even more efficient in the years ahead.

On the strategic front, Range took significant strides to improve its financial foundation. We were decisive and early to monetize assets, as the first among public peers to sell royalty interests, and non-core acreage, for \(1.1 billion over the past 18 months. The asset sales that Range accomplished in 2019 not only improved our financial position by reducing absolute debt, but also reflect the significant value that Range has in its asset base – value that we believe is not reflected in the equity market today. Range's scale and cost-advantaged asset base supported a \)400 million increase in commitments under the bank credit facility during the fourth quarter; and in January of 2020 we were prepared and moved quickly to issue bonds, raising $550 million in capital to refinance nearer term maturities. In the aggregate, this totals over $2 billion in capital brought into the business over the last 18 months, reducing debt by 24%, expanding liquidity to $1.7 billion, and extending the debt maturity profile.

We believe Range's debt reduction, expanded liquidity, and recent refinancing creates a much improved runway for the business; however, it is not our strategy to passively wait for improved prices, though we do believe declining U.S. production and growing demand will improve fundamentals. Nevertheless, asset sales remain a high priority, and we are actively pursuing and marketing multiple asset packages to accelerate Range's debt reduction. In the meantime, our hedging program is designed to support near-term cash flow in a volatile market.

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As we look forward to 2020 and beyond, the framework through which we allocate capital is paramount in understanding the near- and long-term value that Range can generate. As described last year, borne out in our results, and reiterated this year, our focus is on creating economic value. While near-term demand is impacted by COVID-19 and commodity prices are under pressure, Range's resilience and its ability to adapt continue to be demonstrated. For 2020, Range developed a plan driven by internal cash flow, preserving and enhancing liquidity, maintaining capital efficiency, managing absolute debt, and efficiently utilizing existing infrastructure. Importantly, the capital plan is flexible such that we can and will adapt spending to changes in commodity prices. In balancing these objectives to maximize value from the capital program, we have reset our 2020 plans to a focused and efficient $430 million budget. The budget is approximately 40% lower than 2019 spending levels, and targets flat production throughout the year at approximately 2.3 Bcfe per day.

Range has been a leader in well costs among Appalachia producers since discovering the Marcellus. The operational plan that we laid out for 2020 shows that we are continuing to find ways to become even more efficient, with our well costs approaching $600 per lateral foot, which remains the best among our peer companies. In the fourth quarter of 2019, Range began self-sourcing frac sand directly for our completions. Based on the early savings observed, and coupled with the cost reduction associated with an electric fracturing fleet, completion costs are estimated to be reduced by approximately $30 million in 2020, producing another layer of durable cost reduction. These savings and efficiencies result in our expectation of remaining the most efficient natural gas operator in the country during 2020.

In summary, we strongly believe that Range has the best natural gas assets in North America, considering quality, quantity, infrastructure, liquids optionality, and stacked pay. During 2019, we delivered on operational plans under budget, reduced unit costs, led in well costs and capital efficiencies, and de-risked our go-forward plans with significant debt reductions. Range is focused on translating our incredible inventory into shareholder value through the application of a disciplined capital allocation framework, and we remain active in our efforts to monetize additional assets to position the Company for success through the challenge we face with current commodity prices.

We want to acknowledge our employees. They continue to find new creative ways to engineer and produce more efficient wells, while doing it safely. Our commitment to safety, environmental protection, and efficient operations all starts with the individuals we have on the Range team. In addition, Range continued to build upon strong local relationships and expanded on important community programs during the year. First, the Range Resources Good Neighbors Fund, which supports fire departments and emergency management services organizations, increased the funds to $100,000 last year due to the overwhelming amount of qualified grant applications. The other initiative was Range's $50,000 STEM scholarship program, which provides an opportunity for students to visit, collaborate with, and present to our employees. In 2019, the program added both a mentoring component and a new "Problem Solution Forum" during which we hosted more than 120 students and challenged them to solve real problems our employees face every day. We are also very proud to report that Range was recognized and awarded with the "Outstanding Neighbor" proclamation by the South Strabane Township Board of Supervisors for our "tremendous impact of philanthropy, volunteerism, and community service."

We want to thank our Board of Directors for their leadership, guidance, and commitment to long-term value creation for shareholders. Most importantly we thank you, our shareholders, for your continued feedback and support.

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GREG G. MAXWELL
Chairman

JEFFREY L. VENTURA
Chief Executive Officer
& President

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