High Yield Energy: Energy Weekly

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High Yield Energy

Energy Weekly

NBR outlook strong despite war in Iran

02 August 2026

Despite regional geopolitical tensions, Saudi Arabia NBR operations have continued

without interruption, 2026 International outlook was tempered modestly but see over 40

opportunities in 2027 driven by the Middle East and Argentina. The outlook in Venezuela

has improved as several large operators have expressed interest in restarting drilling

programs. See a strong 2H26 in North America driven by contracts. We continue to see

NBR slowly deleveraging. We reiterate our MW recommendation based on RV.

High Yield Credit

United States

Energy

Appalachian gas demand materializing at AM

Table of Contents

Sector Performance

2

Commodity Prices

3

AM highlighted Appalachia demand is starting to materialize. The company increased its

estimates for natural gas demand in the basin from 10 Bcf/d to 12 Bcf/d. 6 Bcf/d of

projects have already reached final investment decision or are under construction.

During the quarter, Antero Midstream began building the East Side Express, its first

regional pipeline which will cost $200-$300mn over the next 2 to 3 years. However, it is

evaluating several billion worth of infrastructure investment and plans to be selective

with projects over the near-term. Reiterate our MW on AM as we continue to see AM

migrating to IG over the long-term, which supports its rich relative valuation.

Relative Value & Comparable Company Information

4

E&P Downside Sensitivity Analysis

9

Western Haynesville costs creep as CRK derisks

CRK reported ~$65mn greater FCF burn than expected and raised 2026 capex by $50mn.

Western Haynesville drilling and completion costs increase by ~9% q/q due to

operational issues and change in completion design. Management sees a path to

improving drilling economics while they continue to derisk the play. They plan to

continue to test these concepts in 2H26. Reiterate OW as we believe investors are

getting paid to be patient.

High Yield Energy underperformed the market this week

Midstream & Distribution Downside Sensitivity

Analysis

Oilfield Services Downside Sensitivity Analysis

11

Company News

12

Midstream Overview

18

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