Sanchez Production Partners reports third quarter 2015 Results; 2016 forecast

Sanchez-Energy

HOUSTON, TX – Sanchez Production Partners LP has reported Q3 2015 results, announced plans to implement a unit repurchase program, and provided a base case forecast for 2016.

Highlights from the report include:

• An initial distribution declared on the Partnership’s common units of $0.40 per unit ($1.60 per unit annualized)

• Implementation of a unit repurchase program of up to $10 million beginning in the fourth quarter 2015

• A base case 2016 forecast that shows the Partnership’s Adjusted EBITDA ranging from $54 million to $60 million, with common unit distribution coverage of 2.2x at the midpoint of this range

• Total revenue of $13.3 million in the third quarter 2015, which includes $7.9 million of sales revenue, approximately 62% of which was from oil and liquids sales and 38% of which was from natural gas sales, $5.0 million from hedge settlements and $0.4 million from services provided to third parties, before $12.3 million in gains from mark-to-market activities, which is a non-cash item

• Operating costs, which include lease operating expenses, production taxes and general and administrative expenses, net of certain non-cash items and non-recurring items, of $24.10 per BOE for the first nine months of 2015, down approximately 5% when compared to the same nine month period of 201

OPERATING AND FINANCIAL RESULTS

The Partnership produced 367 MBOE during the third quarter 2015 for average net production of 3,991 BOE/D during the quarter. For the first nine months of 2015, the Partnership produced 1,093 MBOE for average net production of 4,002 BOE/D, a decrease of 4% when compared to the same nine month period of 2014. Net oil and liquids production for the first nine months of 2015 was 1,190 BBL/D, an increase of 13% when compared to the same nine month period of 2014.

Operating costs, which include lease operating expenses, production taxes and general and administrative expenses, net of certain non-cash items and out-of-period expenses totaling approximately $3.4 million, which are non-recurring items, averaged $25.96 per BOE in the third quarter 2015 as compared to $23.13 per BOE in the prior quarter and $25.76 per BOE in the third quarter 2014.

2016 FORECAST

Based on hedges in place and forward prices as of Sep. 30, 2015, the Partnership’s “base case forecast” estimates that 2016 Adjusted EBITDA will range from $54 million to $60 million, providing Distributable Cash Flow (“DCF”) of $14.4 million to $20.4 million in 2016. Based on these forecast results, the Partnership currently projects common unit distribution coverage will range from 1.8x to 2.6x, or 2.2x at the midpoint of the Partnership’s 2016 DCF forecast.