Annual Report • Mar 17, 2025
Annual Report
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Diversified Energy Company PLC 2024 Annual Report For the Year Ended December 31, 2024 Table of Contents Page Strategic Report 1 A Differentiated Business Model 1 Geographic Operating Areas 1 Key Facts 1 Strategy 2 Key Performance Indicators 3 Our Business 5 Sustainability Review 6 Financial Review 23 Risk Management Framework 32 Viability and Going Concern 35 Corporate Governance 37 The Chairman’s Governance Statement 37 Governance Framework 37 Our Approach to Governance 40 Board of Directors & Senior Management 42 Directors’ Report 45 The Nomination & Governance Committee’s Report 50 The Audit & Risk Committee’s Report 52 The Remuneration Committee’s Report 57 The Sustainability & Safety Committee’s Report 78 Group Financial Statements 81 Independent Auditors’ Report to the Members of Diversified Energy Company PLC 82 Consolidated Statement of Comprehensive Income 91 Consolidated Statement of Financial Position 92 Consolidated Statement of Changes in Equity 93 Consolidated Statement of Cash Flows 94 Notes to the Group Financial Statements 95 Company Financial Statements 137 Company Statement of Financial Position 137 Company Statement of Changes in Equity 138 Notes to the Company Financial Statements 139 Additional Information (Unaudited) 142 Payments to Governments Report 142 Alternative Performance Measures 144 Officers and Professional Advisors 147 Glossary of Terms 148 We have prepared our financial statements and the notes thereto in accordance with UK-adopted international accounting standards and IFRS as issued by the International Accounting Standards Board. To provide metrics that we believe enhance the comparability of our results to similar companies, throughout this Annual Report, we refer to Alternative Performance Measures (“APMs”). APMs are intended to be used in addition to, and not as an alternative for the financial information contained within the Group Financial Statements, nor as a substitute for IFRS. In APMs within this Annual Report , we define, provide calculations and reconcile each APM to its nearest IFRS measure. These APMs include “adjusted EBITDA,” “net debt,” “net debt-to-adjusted EBITDA,” “total revenue, inclusive of settled hedges,” “adjusted EBITDA margin,” “free cash flow,” “adjusted operating cost per Mcfe,” “employees, administrative costs and professional services,” and “PV-10.” 1 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Strategic Report Page A Differentiated Business Model 1 Geographic Operating Areas 1 Key Facts 1 Strategy 2 Key Performance Indicators 3 Sustainability Review 6 Financial Review 23 Risk Management Framework 32 Viability and Going Concern 35 Overview of Our Business Diversified Energy Company PLC (the “Parent” or “Company”) and its wholly owned subsidiaries (the “Group,” “DEC,” or “Diversified”) is an independent energy company engaged in the production, transportation and marketing of natural gas, natural gas liquids and crude oil. Our proven business model creates sustainable value in today's energy markets by investing in producing assets, reducing emissions and improving asset integrity while generating significant, hedge-protected cash flows. We acquire, optimize, produce and transport natural gas, natural gas liquids and oil from existing wells then retire our wells at the end of their life to optimally steward the resource previously developed by our peers, reducing the environmental footprint, while sustaining important jobs and tax revenues for many local communities. While most companies in our sector are built to explore and develop new reserves, we fully exploit existing reserves through our focus on safely and efficiently operating existing wells to maximize their productive lives and economic capabilities, which in turn reduces the industry’s footprint on our planet. A Differentiated Business Model Our business model is unique among the natural gas and oil industry in that we do not rely on capital-intensive drilling and development . Rather, our stewardship model focuses on acquiring existing long-life, low-decline producing wells and, at times, their associated midstream assets, and then efficiently managing the assets to improve or restore production, reduce unit operating costs, improve operational safety, reduce emissions and generate consistent free cash flow before safely and permanently retiring those assets at the end of their useful lives. Daily Operating Priorities Our guiding daily principles underline our commitment to value creation without compromising the safety of employees. These principles - Safety, Production, Efficiency and Enjoyment - drive the success of our business model. Our workforce gives precedence to these principles in their daily work. Geographic Operating Areas Appalachian Region The Appalachian Region spans Pennsylvania, Virginia, West Virginia, Kentucky, Tennessee and Ohio and consists of two productive unconventional shale formations, along with numerous conventional formations . We entered the Appalachian Region in 2001 and currently operate within the Marcellus Shale and the slightly deeper Utica Shale, as well as many conventional formations. Central Region Our Central Region includes parts of Texas, Louisiana and Oklahoma, and is home to a number of asset rich natural gas and oil formations. We entered the Central Region in 2021 and currently operate within the Haynesville, Bossier, Cotton Valley, Barnett and Mid Continent plays. Key Facts for 2024 Net Loss Total Revenue Adjusted EBITDA Margin(a) Adjusted EBITDA(a) $87 million $795 million 50% $472 million Production Mix Production PV-10 Value of Reserves Asset Acquisitions 84% natural gas 244,298 natural gas (MMcf) $3.3 billion(b) 3 acquisitions 12% NGLs 5,980 NGLs (MBbls) 4,483,836 MMcfe $585 million, gross 4% oil 1,568 oil (MBbls) $388 million, net Scope 1 Methane Emissions Intensity No-Leak Rate on Surveyed Assets Total Recordable Incident Rate Reportable Spill Intensity 0.7 MT CO2e/MMcfe 98% Group-wide 0.89 per 200,000 work hours 0.08 oil & water per MBbl (a) Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. (b) Based on NYMEX strip pricing. 2 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Strategy Our growth and ability to generate consistent shareholder returns stems from our unique business model and successful execution of low-risk, disciplined and proven operating techniques. 1 Acquire long-life stable assets We practice a disciplined approach to acquire long-life stable assets by targeting low-decline producing assets that are value accretive, high margin and strategically complementary, while also applying extensive environmental, social, land and legal due diligence. 2024 Achievements Targets for 2025 • Completed three acquisitions in our Central Region, including: • Oaktree working interest acquisition for gross consideration of $410 million and net consideration of $222 million , contributing approximately $66 million MMcfepd to 2024 revenue. • Crescent Pass acquisition for gross consideration of $106 million and net consideration of $98 million, contributing approximately $10 million MMcfepd to 2024 revenue. • East Texas II acquisition for gross consideration of $69 million and net consideration of $68 million, contributing approximately $5 million MMcfepd to 2024 revenue. • Successfully merge assets acquired in the recently completed acquisition of Maverick Natural Resources, LLC (“Maverick”) to build scale and achieve synergies. • Effectively integrate acquisitions into our existing operations, ensuring seamless transitions and alignment with our strategic objectives to drive growth and maximize synergies. • We will continue our disciplined acquisition strategy, targeting assets that meet our strict investment standards. • We will maintain liquidity rigor, ensuring we are well-positioned to capitalize on market opportunities as they emerge. • Our growth strategy will prioritize expanding in complementary and synergistic ways, while building strong partnerships with development-focused producers in our key operating regions. Link to Risks: 1 2 4 Link to KPIs: 1 5 2 Operate our assets in a safe, efficient and responsible manner Our operational strategy and success is closely aligned with the culture we created with our daily operational priorities. Our team embodies these priorities through our Smarter Asset Management (“SAM”) program, working tirelessly to ensure the safe delivery of clean, affordable and reliable energy. 2024 Achievements Targets for 2025 • Annual production of 791 MMcfepd. • Exit rate of 864 MMcfepd. • Adjusted EBITDA margin of 50%. • Achieved a 98% no-leak rate on surveyed assets. • LTIR of 0.38 per 200,000 work hours, a decline of 63% year-over- year. • We will remain committed to our daily operating priorities: Safety, Production, Efficiency, and Enjoyment. • Our dedication to responsible stewardship remains steadfast. We will focus intently on continuous improvement in all aspects of sustainability, striving to exceed our stakeholders’ expectations. • We will continue to prioritize the SAM program to sustain margins, mitigate natural declines, and leverage expense efficiency opportunities. Link to Risks: 1 2 4 5 6 7 Link to KPIs: 3 4 5 6 7 3 Generate Reliable Free Cash Flow Our business model is inherently designed to generate free cash flow. Furthermore, we aspire to make cash flows predictable and reliable so we can consistently generate shareholder return, pay down debt, fund acquisitive growth, and accomplish our sustainability goals and ambitions. 2024 Achievements Targets for 2025 • Repaid $206 million in asset-backed debt securitizations. • Repurchased 1,638,030 shares, representing $21 million in shareholder value above and beyond the $84 million in dividend distributions. • $151 million gain on settled derivative instruments. • Recorded $8 million in coal mine methane revenues. • Divested certain non-core undeveloped acreage across our footprint for a total of $59 million . • We will continue our effective hedging strategy to protect cash flows. Additionally, we will capitalize on accretive market opportunities to elevate our hedge book floor. • We will continue to apply our Smarter Asset Management program to maintain low decline rates across our producing assets and review opportunities to optimize both core and non-core assets. • We will remain dedicated to prudent cash flow growth through accretive acquisitions that complement our existing asset base. Link to Risks: 1 2 3 4 7 Link to KPIs: 1 2 3 4 5 3 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report 4 Retire assets safely and responsibly At the end of a well’s economic life, our safe and systematic asset retirement program ensures wells are permanently retired and well sites are responsibly restored to their natural condition. Our retirement program underscores our strong commitment to a healthy environment, the surrounding community, our neighbors , and state regulatory authorities. 2024 Achievements Targets for 2025 • Expanded our asset retirement operations to 18 teams and 18 rigs. • Retired 202 DEC-owned wells in the Appalachian Region and a further 13 DEC-owned wells in our Central Region, surpassing our goal to retire 200 wells in 2024 and exceeding our collective state commitments in Appalachia. • Additionally, we retired 85 third party-owned wells in the Appalachian Region, including 51 state and federal orphan wells and 34 for third party operators, bringing the total wells retired by the Next LVL team to 287 wells. • We will continue to safely retire wells, aiming to exceed state asset retirement program commitments by identifying and retiring wells at the end of their productive lives. • We will continue to leverage the benefits of vertical integration through our expanded internal asset retirement capacity. • We will maintain constructive and collaborative dialogue with states and industry associations to innovate and ensure best practices in well retirement. Link to Risks: 1 2 4 5 6 Link to KPIs: 2 4 5 6 Key Performance Indicators In assessing our performance, the Directors use key performance indicators (“KPIs”) to track our success against our stated strategy. The Directors assess our KPIs on an annual basis and modify them as needed, taking into account current business developments. The following KPIs focus on corporate and environmental responsibility, consistent cash flow generation underpinned by prudent cost management, low leverage and adequate liquidity to protect the sustainability of the business. Refer to APMs within this Annual Report for information on how these metrics are calculated and reconciled to IFRS measures. 1 Net Debt-to-Adjusted EBITDA 2024 2023 2022 Net debt-to-pro forma adjusted EBITDA 3.0x 2.2x 2.4x During 2024 our leverage ratio increased to 3.0x primarily due to financing the majority of our acquisitions with debt . We actively manage our balance sheet and seek to maintain a long-term leverage ratio of approximately 2.5x. Link to Strategy: 1 3 Link to Risks: 1 3 4 5 6 7 2 Adjusted EBITDA Margin 2024 2023 2022 Adjusted EBITDA Margin 50% 52% 49% T otal revenue, inclusive of settled hedges and adjusted EBITDA decreased 10% and 14%, respectively, in 2024 , while adjusted EBITDA margin remained relatively consistent at 50%. The decrease in total revenue, inclusive of settled hedges was primarily due to a decrease in the average realized sales price, lower production, a decline in hedge settlement gains, and normal declines. The decrease in adjusted EBITDA was driven by a decrease in commodity pricing and lower production. Link to Strategy: 3 4 Link to Risks: 1 2 3 4 5 6 7 3 Adjusted Operating Cost per Mcfe 2024 2023 2022 Adjusted Operating Cost per Mcfe $1.78 $1.76 $1.77 Adjusted operating cost per Mcfe for 2024 was $1.78 , an increase of 1% compared with 2023. This increase was primarily due to higher employees, administrative costs and professional services due to investments made in staff and systems and costs related to litigation expense. Link to Strategy: 2 3 Link to Risks 1 4 5 6 4 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report 4 Net Cash Provided by Operating Activities 2024 2023 2022 Net Cash Provided by Operating Activities (in millions) $346 $410 $388 Net cash provided by operating activities for 2024 was $346 million, a decrease of 16% compared with 2023. This decrease was due to the decrease in total revenue resulting from decreases in pricing and production. However, this was partially offset by changes in working capital, which generated $50 million less in cash outflows compared to 2023 . Link to Strategy: 2 3 4 Link to Risks: 1 2 3 5 6 7 5 Emissions Intensity 2024 2023 2022 Emissions Intensity (MT CO 2e/MMcfe) 0.7 0.8 1.2 Realized a 13% year-over-year reduction in Scope 1 methane emissions intensity, achieved through investments in leak detection technologies, replacing natural gas-driven pneumatics with instrument air or solar solutions, and enhanced aerial emissions surveillance in our Central Region. Link to Strategy: 1 2 3 4 Link to Risks: 2 5 6 Meet or Exceed State Asset Retirement Goals 2024 2023 2022 DEC-owned well retirements(a) 215 222 214 Wells retired by Next LVL 287 383 262 (a) DEC wells inclusive of 13, 21 and 14 Central Region wells retired during 2024, 2023 and 2022, respectively . A total of 215 DEC-owned wells, including 13 in the Central Region, were retired across our operating footprint, surpassing our goal to retire 200 wells and exceeding our collective state commitments in Appalachia. Additionally, Next LVL Energy plugged a total of 287 wells in Appalachia , including 202 DEC-owned wells and 85 third party-owned wells consisting of 51 state and federal orphan wells and 34 for third party operators. Link to Strategy: .4. Link to Risks: 2 4 5 7 Safety Performance 2024 2023 2022 TRIR (per 200,000 work hours) 0.89 1.28 0.73 LTIR (per 200,000 work hours) 0.38 1.04 0.66 MVA (incidents per million miles) 0.34 0.55 0.69 Our 2024 TRIR was 0.89, a 30% improvement from 2023, driven by a foreman-led safety approach, enhanced good catch/near miss reporting, and a new safety program for short-service field employees. Additionally, our 2024 LTIR was 0.38, reflecting a 63% improvement from 2023, attributable to the same initiatives. Moreover, our 2024 MVA rate was 0.34, a 38% improvement from 2023. This improvement was primarily due to specific actions taken to enhance performance and accountability, including the implementation of vehicle telemetric monitoring. Link to Strategy: .2 . Link to Risks: 5 6 5 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Our Business History & Development of the Business We are an independent energy company focused on natural gas and liquids production, transportation, marketing and well retirement, primarily located within the Appalachian and Central regions of the United States. We were incorporated in 2014 in the United Kingdom, and our predecessor business was co-founded in 2001 by our Chief Executive Officer, Robert Russell (“Rusty”) Hutson, Jr., with an initial focus on primarily natural gas and oil production in West Virginia. In recent years, we have grown rapidly by capitalizing on opportunities to acquire and enhance producing assets and by leveraging the operating efficiencies that result from economies of scale. As of December 31, 2024, we have completed 27 acquisitions since 2017 for a combined purchase price of approximately $3.1 billion. In addition, on March 14, 2025, we completed our previously announced acquisition of Maverick for a gross purchase price of approximately $1,275 million . Throughout our history, we have prioritized sustainability and efficiency in our operations. Recognizing the global reliance on natural gas, we emphasize the importance of responsible ownership and environmental stewardship in managing natural gas and crude oil wells and pipelines. Our proven track record of acquiring, integrating and responsibly operating assets reflects this commitment. With our focus on efficient and environmentally sound energy production, we are well-positioned to assist in meeting national and global energy demands. Other Information We were incorporated as a public limited company with the legal name Diversified Gas & Oil PLC under the laws of the United Kingdom on July 31, 2014 with the company number 09156132. On May 6, 2021, we changed our company name to Diversified Energy Company PLC. Our registered office is located at 4th Floor Phoenix House, 1 Station Hill, Reading, Berkshire United Kingdom, RG1 1NB. In February 2017, our shares were admitted to trading on the AIM Market of the London Stock Exchange (“AIM”) under the ticker “DGOC.” In May 2020, our shares were admitted to the premium listing of the Official List of the Financial Conduct Authority and to trading on the Main Market of the LSE. With the change in corporate name in 2021, our shares listed on the LSE began trading under the new ticker “DEC.” In December 2023, the Group’s shares were admitted to trading on the New York Stock Exchange (“NYSE”) under the ticker “DEC.” Following the changes to the UK Listing Rules on July 29, 2024, the Company continues to remain listed on the new equity shares (commercial companies) category of the Official List of the Financial Conduct Authority. As of December 31, 2024, the principal trading market for the Group’s ordinary shares was the LSE. Our principal executive offices are located at 1600 Corporate Drive, Birmingham, Alabama 35242, and our telephone number at that location is +1 205 408 0909. Our website address is www.div.energy. The information contained on, or that can be accessed from, our website does not form part of this Annual Report . We have included our website address solely as an inactive textual reference. Business Overview Our Business Model • Acquire - We maintain a disciplined approach to evaluating opportunities to ensure that we only pursue those properties that possess a consistent asset profile. We target existing long-life, stable assets with synergistic opportunities that produce predictable and stable cash flows, are value accretive, margin enhancing and strategically complementary. • Optimize - The primarily mature nature of the assets we acquire provides us with a portfolio of low-cost optimization opportunities. These optimization activities, applied through our internally developed SAM program, are strategically important as they aid in offsetting natural production declines, creating expense efficiency and reducing emissions. • Produce - Our culture makes the difference as our team of industry veterans strive to efficiently produce as many units as possible in a safe and environmentally responsible manner, aligning safety, environmental and financial best interests. • Transport - We seek to acquire midstream systems into which we are a large producer and more fully integrate those assets into our upstream portfolio to provide immediate and long-term synergies. • Retire - We embrace our commitment to be a responsible operator of existing assets. With safety and environmental stewardship as top priorities, we design our asset retirement program to permanently retire wells that have reached the end of their producing lives. Between 2022 and 2024, we made investments that allowed us to expand our asset retirement capabilities through a series of acquisitions. Our Strengths • Low-risk and low-cost portfolio of assets • Long-life and low-decline production • High margin assets that leverage significant scale, supported by owned midstream and asset retirement infrastructure, along with an internal product marketing team • A management and operational team with extensive experience • Proven history of successfully consolidating and integrating acquired assets Outlook Looking ahead, we will continue to prudently manage our long-life, low-decline asset portfolio and the consistent cash flows they generate. We plan to maintain our hedging strategy to safeguard cash flow. Our goal is to retain our strategic advantages through purposeful growth, employing a disciplined acquisition strategy that secures low-cost financing to support acquisitive growth while maintaining low leverage and prudent liquidity. Additionally, we intend to stay proactive in our sustainability efforts by continuing to allocate capital to future sustainability initiatives. 6 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Sustainability Review We are committed to addressing key environmental issues f rom our operations , as well as relevant social issues for the people across our operations, while upholding the values and principles upon which we were founded. We adhere to high operating standards with a strong focus on environmental protection, employee health and safety, and positive community engagement. We proudly accept the responsibility and privilege of being part of the solution to the significant challenges of our nation’s energy, environment, and economic security. By providing a reliable supply of abundant domestic energy from assets with a smaller environmental footprint than newly drilled wells, we support our nation’s energy security. We invest in and implement measures to reduce emissions at our facilities, produce differentiated natural gas through industry-recognized emissions detection, measurement, and mitigation processes, and retire orphan wells for several states, contributing to environmental best practices. Additionally, we provide affordable and sustainable domestic energy, direct and indirect employment, mineral royalties, and support tax revenues for the communities where we operate, contributing to economic prosperity, opportunity, and security. We invite you to explore our annual Sustainability Report, typically released in the second calendar quarter, to gain insights into our actions aimed at identifying, improving, and monitoring our sustainability efforts focused on planet, people, and principles. Our Sustainability Reports are available on our website at www.div.energy. Our Approach to Sustainability Our sustainability strategy is anchored on the pillars of prudent risk management, asset integrity, employee safety, environmental protection, and emissions reduction. We integrate sustainability and safety into our operational strategy across our upstream, midstream, and well retirement activities by implementing data-driven practices and programs to drive collaboration and innovation, inform decision-making, and optimize our daily actions. This approach is rooted in our differentiated stewardship model, which prioritizes a comprehensive, life-cycle approach to managing our assets, coupled with a commitment to sustainability leadership and transparent reporting of our actions. Our leadership and transparency have been recognized through various accolades, including: • OGMP 2.0: Achieved the Gold Standard Pathway designation for the third consecutive year. • ESG Awards: Received shortlist honors for our 2023 Sustainability Report in two categories - ESG Report of the Year and Carbon Footprint ESG Performance of the Year. • MSCI: Awarded a AA-rating for our actions and disclosures for the second consecutive year. An important aspect of our approach is consistent engagement with our stakeholders, seeking their input and keeping them apprised of progress against our sustainability ambitions. One key component of that engagement is our periodic stakeholder materiality assessment, last updated in 2023 and inclusive of input from a broad range of internal and external stakeholders. Through this assessment and ongoing engagement throughout the year, we gain a better understanding of the issues that matter most to our stakeholders and, therefore, where we should continue to direct our sustainability and stewardship strategies and efforts. Recognizing the relevance to stakeholders of our sustainability activities, we intentionally link certain environmental and safety commitments to our debt capital financings and executive compensation strategies, as described in Sustainability-Linked Borrowings and Remuneration Policy, respectively, within this Annual Report. Protecting Our Environment We carried the momentum of our previous years’ Scope 1 methane intensity reductions into 2024, where we further reduced methane emissions through several key initiatives: • Investing in Technology: We deployed fit-for-purpose leak detection and quantification technologies for ongoing voluntary leak detection and repair (“LDAR”) inspections. • Innovative and Collaborative Efforts: We replaced natural gas-driven pneumatics with site-specific instrument air or solar solutions. • Expanding Surveillance: We broadened aerial emissions surveillance across our Central Region asset locations. Additionally, we significantly expanded our application of the Xplorobot direct measurement quantification technology, focusing on obtaining attaining actual emission measurements to replace the use of theoretical emission factors. These collective actions resulted in a year-end Scope 1 methane intensity of 0.7 MT CO2e per MMcfe, representing a 13% reduction from the prior year end. We remain vigilant in monitoring the evolving regulatory landscape for emissions reporting, particularly in the U.S., where new and forthcoming federal and state regulations may alter emissions accounting methods and introduce new categories of reported emissions. These new categories could potentially increase our future reported emissions despite our ongoing reduction efforts. As we adapt to these regulatory updates, we continue to explore opportunities to expand our lower carbon projects, such as coal mine methane capture. The evolving landscape of lower carbon projects not only helps reduce emissions but also presents opportunities for generating and selling alternative energy credits. In 2024, our environmental stewardship efforts also focused on knowledge sharing, best practices, innovative solutions, and technological advancements in water consumption, waste management, spill prevention, and biodiversity initiatives. For more details on our emissions reduction activities and to explore the Group’s climate-related risks and opportunities, refer to the Climate Report within this Annual Report. Alternatively, you can review our standalone Sustainability Report on our website at www.div.energy (expected to be published in the second quarter of 2025). Supporting Our Employees Safety - No Compromises is our utmost daily priority . We increased our efforts in 2024 to advance several safety improvement initiatives. A key step was the creation of a multi-departmental and geographically diverse Safety Strategy Task Force. Through the actions of this task force, we: 1. Developed a monthly foreman-led safety approach focused on meaningful team interactions and improved the quality and quantity of good catch amnesty reporting. 2. Improved accountability through vehicle telemetric monitoring. 3. Enhanced recognition programs emphasizing strong safety leadership. 7 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report 4. Collaboratively created a new safety expectations program for short-service field employees. The success of these efforts is best measured by the improvements in our personal and driver safety KPIs. Our TRIR, LTIR, and MVA recorded across- the-board improvements compared to year-end 2023 and outperformed our current year’s compensation-based stretch targets. We are dedicated to creating a workplace that attracts and retains a talented staff by offering competitive salaries and meaningful benefits. We strive to foster a unified company culture, provide equitable growth and development opportunities, and create a collaborative and enjoyable work environment where all employees feel valued and supported. Our OneDEC approach drives a culture of operational excellence by integrating people and standardizing processes and systems. This approach supports and encourages company-wide initiatives by ensuring alignment of our corporate and sustainability goals with individual or collaborative actions, backed by financial investment and well-understood principles and policies. Workforce Composition As of December 31, 2024, the majority of our workforce consisted of production employees, including those in upstream, midstream, and asset retirement field roles. All other positions, such as back office, administrative, and executive roles, are classified as production support roles. Our entire workforce is based in the United States, in alignment with our U.S.-based assets. December 31, 2024 December 31, 2023 # % # % Female 19 2% 16 1% Male 1,168 98% 1,198 99% Production employees 1,187 1,214 Female 182 45% 167 43% Male 220 55% 222 57% Production support employees 402 389 Total employees 1,589 1,603 As of December 31, 2024, our Senior Management team, comprising the executive committee and their direct reports (excluding the Executive Director), consisted of 92 em ployees. This group included 36 females (39%) and 56 males ( 61%). Serving Our Communities We play a vital role in supporting communities across our 10-state operational footprint. By providing employment opportunities with competitive salaries and excellent benefits, as well as contributing state and local tax revenues, royalty payments, and other direct and indirect investments, we significantly impact the economies of these states and positively affect the communities where we operate. We believe that with the privilege and social license to operate comes the responsibility to support the communities in which we live and work. Central to our community engagement efforts is a focus on driving volunteerism and corporate philanthropy through our 1,589 employees, who intimately understand the challenges faced by their local communities. To facilitate these efforts, we have established a dedicated, employee-led Community Relations Committee aimed at fostering thriving environments in our communities. In 2024, through numerous community outreach efforts and other corporate initiatives, we directly contributed approximately $2.1 million to support community enrichment, STEM-based education, student athlete related ventures and opportunities, workforce development, and environmental initiatives. Additionally, in the last year alone, we have supported our communities and operational areas through the more than $1 billion in contributions to the U.S. GDP when considering both the direct and ancillary impacts of our operations. Climate Risk and Resilience Report (“Climate Report”) Climate Relevance at Diversified As a responsible steward of the environment, Diversified firmly believes that it is possible to simultaneously support both climate and energy security for our nation and the globe, via lower-carbon, reliable, and affordable energy that is inclusive of natural gas and oil production. To achieve this position and thus sustain an economy that can continue to thrive and compete on the global stage, we support a balanced mix of cleaner hydrocarbons and other energy sources which collectively advance a lower carbon footprint. Our ongoing Smarter Asset Management initiatives continue to evolve, intentionally prioritizing methane reduction due to its greater potential for atmospheric warming. In 2021, the Group launched several specific initiatives aimed at reducing methane emissions intensity. Since then, we have achieved a reduction of over 50% in our Scope 1 methane intensity (vs. 2020 baseline), and we continue to actively collaborate both internally and with technology partners to further decrease these emissions. We are seeing the intended results of our dedicated emission reduction efforts, driven by our long-standing business model that has valued optimizing the operational and environmental performance of our asset portfolio. We recognize, however, the longevity of this cleaner energy, climate-focused journey. Thus, while we have no current plans to amend our business model, we remain committed to reviewing and evolving, as may be warranted, our future climate strategies, supported by actions which advance our underlying climate objectives while continuing to deliver long-term value for our stakeholders. Disclosures and Assurance This Climate Report is consistent with the recommendations of the Task Force on Climate-related Financial Disclosures (“TCFD”) (former), with the exception of Scope 3 emissions, and in line with the Financial Conduct Authority’s Listing Rule 6.6.6. This report also reflects the guidance provided in the TCFD Annex, Section C, “Guidance for All Sectors” and Section E, “Supplemental Guidance for Non-Financial Groups”, related to the Energy sector. This Climate Report and Annual Report should be read in conjunction with our separately published 2024 Sustainability Report, where both such reports will be available on our website at www.div.energy. Together, these year-end reports provide a transparent, complementary review of Diversified’s strategy, business model and results on material ESG and broader sustainability issues. 8 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Scope 1 and 2 greenhouse gas (“GHG”) emissions data for calendar year 2024 as reported herein are being assured by ISOS Group Inc. (“ISOS”), who is providing moderate Level II (limited) assurance in accordance with the AccountAbility 1000 Assurance Standard v3. When completed, refer to ISOS’ independent assurance letter as presented in the Appendix of our 2024 Sustainability Report for more information on the scope and findings of the assurance. Governance - From the Wellhead to the Boardroom By employing both top-down and bottom-up strategies, our robust governance framework integrates a focus on sustainability and climate across the entire organization. This includes engagement, ownership and accountability at every level. Climate-related Governance Framework Board of Directors ( 10 meetings in 2024) Promotes value creation and long-term success of the Group through oversight of corporate strategy and business model, including climate and other ESG-related factors. Sustainability & Safety Committee (six meetings in 2024) Evaluates climate and energy transition-related issues to inform the Board’s climate decision-making and monitors climate public policy trends and related regulatory matters. Audit & Risk Committee ( five meetings in 2024) Ensures climate risk is properly identified, assessed and managed through enterprise risk management processes and potential climate impacts are appropriately considered in company financial models. Nomination & Governance Committee (three meetings in 2024) Oversees corporate governance structure of the Board, ensuring a balance of climate knowledge and other ESG-related factors are considered when seating a diverse Board and formulating succession plans. Remuneration Committee ( three meetings in 2024) Ensures Sustainability KPIs, including achievement of GHG emission reduction targets, are included in compensation programs, and reviews and approves annual progress of the same. Chief Executive Officer Assumes primary responsibility for delivering the Group’s climate and related energy strategy and communicating progress of the same to investors and other stakeholders. Executive Management Oversees development, execution, assessment and reporting or climate, environmental and sustainability initiatives, including related operational and financial impacts of these initiatives. Business Departments and Advisory Working Groups Actively collaborates and seeks to promote continuous improvement and best practice application in day-to-day operations in support of the Group’s climate and sustainability targets and goals. Progression of Oversight & Guidance Progression of Response & Reporting Board Oversight As a whole and through its independent committees, the Board oversees the long-term success, viability and value creation of our business through its oversight of our strategy, business model and risk profile, which includes, in part, climate-specific risk management and mitigation, climate goal setting and progress, and new climate-related commercial opportunities as they may arise. The Board recognizes that the world’s approach to climate and decarbonization can represent both operational and financial risks to the Group. Thus, climate-related topics are often addressed at Board meetings, and we have established corporate-level KPIs related to sustainability and climate. Further during 2024, the Board received targeted climate training from outside counsel that included updates on final, currently proposed and potentially forthcoming US and UK climate-related regulations with respect to GHG emissions reporting; environmental risks, financial impacts, and materiality; carbon credit generation and trading mechanisms; and general governance perspectives. During 2024, the Board convened 10 times where climate-related topics were brought before the Board by executive management and the chair of each Board committee, as applicable. Our current climate-related risk appetite and associated opportunity set directly impacted Board-level climate discussions during the year, including decisions on acquisitive growth and strategy, emissions reduction and management practices, technology innovation, executive compensation linked to climate objectives, risk management and mitigation, and regulatory and legislative risk. The Board’s knowledge of climate and its impact on business is informed, in part, by the following experiences of one or more of its members: • Chair of ESG or EHS board committees for third-party companies; • Advisor and/or assurance provider regarding climate risk management, emissions monitoring, sustainability strategies, leak detection and repair, and clean air and climate regulation; • Author of guiding principles on climate for a US independent federal government agency; • Annual climate and sustainability training through U.S. National Association of Corporate Directors; • Stakeholder engagement inclusive of investors, financial institutions, and legal and public relations experts; • Executive advisor and lead resource in production and publication of corporate ESG and sustainability reports; 9 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report • Lead resource to plan and deliver corporate seminars covering the energy transition, climate, ESG activism and related disclosure; • Legal advisor to corporates in oil & gas, renewable energy, natural resources and mining, and early-stage technology; • Corporate board- and management-level engagement regarding climate risk and mitigation in line with the company’s risk management framework; and • Service on the Disclosure Review Committee, including climate disclosures using the TCFD framework. For more information on Board composition and its members’ skills and qualifications, refer to Board of Directors within this Annual Report. All committees of the Board have a unique role to play in our sustainability and climate journey. The full Board takes the work of these fully independent committees into account in considering and providing guidance on sustainability and climate strategy and objectives for the short-, medium- and long- term. Each committee’s charter includes appropriate climate-related risk and opportunity responsibilities in its respective duties, as can be found in the committees’ respective charters on our website at www.div.energy. On an annual basis, the Board reviews each of these committee charters and approves our corporate sustainability and climate policy positions and commitments, all of which are posted on our website and in climate disclosures included within this Annual Report. The Sustainability & Safety Committee (“Sustainability Committee”) has an active oversight of the Group’s approach to evaluation of all issues relating to climate risk, including (i) operational climate mitigation and adaptation plans and actions, (ii) changes in policy and regulation, and (iii) other global, macro-level developments relating to the energy transition. Importantly, our Board chair serves as a member of this Sustainability Committee. For more information on the climate-related activities of the Sustainability Committee in 2024, refer to the Sustainability & Safety Committee’s Report within this Annual Report. Management Oversight Management remains abreast of climate-related issues through (i) its knowledge of our industry, business environment and ongoing operating activities, (ii) frequent interactions with both internal and external stakeholders, including senior leaders in the Group, state and national regulators and investors, and (iii) engagement with vendors, industry associations and benchmarking groups where current trends and best practice operating standards and emissions reductions solutions are shared. Climate-related responsibilities are assigned to management-level positions according to each individual’s area of responsibility and contribution to our overall corporate strategy. The Group has appointed a Senior Vice President of Sustainability who, alongside the Executive Vice President of Operations and the Senior Vice President of EHS, regularly attends the Committee’s meetings to address current and emerging risks and opportunities within the areas of sustainability and climate. Leadership employees and certain of their direct reports also have climate-linked objectives within their remuneration packages. For more information on executive remuneration linked to climate, refer to the Remuneration Committee’s Report within this Annual Report. The Chief Executive Officer assumes ultimate responsibility for the delivery of the Group’s climate and energy strategy, as approved by the Board and inclusive of addressing identified climate-related risks and opportunities. With the support of executive and senior management teams, this responsibility includes asset portfolio reviews (such as opportunities for expansion or alternative uses of the portfolio), capital investments and allocations, regulatory and policy considerations, and approach to a lower carbon climate including emission reduction targets and goals. Specific actions and outcomes related to these responsibilities were brought before the Board and its committees, accordingly, during the year. The President and Chief Financial Officer ensures our corporate approach and response to climate is integrated into respective capital and operating programs and stakeholder communications. This responsibility is addressed and undertaken through the relative actions of the remaining Executive Management team whose unique roles support our climate goals and performance. The Senior Vice President of Sustainability plays a key role in advising the Board and management on various climate-related matters such as climate regulation and disclosure, supporting corporate GHG emission reduction initiatives, and liaising with both internal and external stakeholder groups about climate-related commitments and actions. Collaborative Team Oversight Environmental management and energy transition topics are deeply embedded into our company’s culture and collaborative daily actions, as climate impact is recognized as a key strategic consideration across multiple business functions and departments. For example, we have trained and equipped 100% of our well tenders to become LDAR technicians. Since our company’s inception, finding and repairing leaks has been a priority for Diversified as we seek to support our customers’ energy needs while simultaneously positively impacting our climate in delivering a lower-carbon energy solution to the market. Furthermore, at an operational level, we seek to maintain optimized well tender routes to increase efficiency and reduce driving time, thus reducing vehicle emissions. See the Climate-Focused Sustainability table below for a broader view of the roles that individual departments play in ensuring climate considerations remain at the forefront of our daily actions, inclusive of transparent reporting of corporate climate risk and resilience. 10 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report CLIMATE-FOCUSED SUSTAINABILITY Executive Oversight Area of Operation Areas of Responsibility and Action President & Chief Financial Officer Accounting, Treasury & Finance Climate budget and impact modelling; climate risk and awareness in corporate ERM process; asset retirement obligation accounting and reporting; risk insurance and sustainability-linked financings Information Technology Accessible dashboards to monitor LDAR efforts; real-time monitoring of potential environmental/climate impacts Investor Relations Stakeholder transparency on climate targets and progress Internal Audit Oversight and tracking of climate risk mitigation actions Chief Legal & Risk Officer Land & Legal National, state and local climate public policy monitoring and engagement; land management opportunities for energy transition development Executive Vice President- Operations Upstream(a) Emissions detection, repair and reduction; wellhead optimization; equipment and efficiency upgrades Midstream(a) Emissions detection, repair and reduction; compression conversion or elimination; measurement and monitoring of production flows Asset Retirement(a) End of life (Group) and orphan/abandon (third-party) well plugging and site restoration Environmental, Health & Safety Marginal Abatement Cost Curve (“MACC”)-driven emission reduction project management; emerging technology field testing and trials; ESG- and climate-minded contractor selection and management; emissions tracking Gas Control 24/7 monitoring for early detection of potential climate impacting circumstances Chief Human Resource Officer Human Resources Sustainability-linked compensation Facilities Management Fleet management and efficiencies; waste management and recycling Executive Vice President- Marketing Marketing Sale of environmentally differentiated produced natural gas; delivery point sales management Executive Vice President- Business Development Business Development Climate and water consumption due diligence at time of acquisition consideration (a) Direct field operations; all other Areas of Operations reflected above represent back-office or administrative support. We do not have a single internal sub-committee or department dedicated to advancing sustainability and climate initiatives. Rather, these initiatives are driven by the collaborative daily efforts of our teams. We have also created unique, cross-functional advisory focus groups to address specific climate initiatives such as pneumatics conversions, business development due diligence, or spill prevention. These focus groups engage regularly and are comprised of geographically and departmentally diverse employees across the organization that support our sustainability and climate actions and drive daily progress against related targets and goals. The executive or senior level advisors of these focus groups are the same individuals who participate in Board and/or Sustainability & Safety Committee meetings, thus ensuring the work of these groups is progressed to the Board level. Strategy - Maintaining Progress In support of both climate and business resiliency, we remain focused on reducing near-term methane emissions while advancing other low carbon initiatives. Decarbonization strategies and programs Our climate strategy centers on reducing methane emissions as a key part of our practical approach to decarbonizing our operations. In 2023 and seven years ahead of schedule, we achieved our 2030 target to reduce Scope 1 methane intensity by 50% (versus a 2020 baseline). In 2024, we continued to progress our decarbonization strategy and methane reductions through multiple avenues, including but not limited to: • Ongoing voluntary leak detection and quantification programs; • Fit-for-purpose replacement, or ultimate retirement, of natural gas-driven pneumatic devices; • Expanded use of actual emission measurements as compared to default emission factors; • Field testing and adoption of new or emerging technologies and applications; and • Internally-developed, innovative methane reduction projects as part of our proven Smarter Asset Management program. Tackling methane slip and methane leak quantification remained key goals in 2024 as we advanced our efforts toward achieving Level 5 of OGMP 2.0 recognition. We partnered with several specialized technology companies as we continued to identify and apply new technologies that can help quantify and reduce methane slip. Equally, we expanded the use of Xplorobot, and other complementary technologies, for completing highly efficient leak surveys and quantification of emissions. We also continued to explore new opportunities that allow us to leverage our asset portfolio, skills, and expertise in ways that extend beyond our traditional business model, such as our expansion into the adjacent market of Coal Mine Methane capture. Capturing coal mine methane delivers multiple benefits for both the environment and shareholders, as we eliminate the release of methane into the atmosphere while generating cash flows through additional gas sales and the associated sale of Alternative Energy Credits generated through this capture program. In 2025 and beyond, continued advancement of these and other programs and opportunities could be significantly enhanced by securing federal grants, which the Group has actively sought. One such grant is a $5 million U.S. Department of Energy and U.S. Environmental Protection Agency award recently given to Pioneer Energy Partners (“Pioneer”) and Diversified to adapt Pioneer’s existing Emission Control Treater™ technology to eliminate inefficient venting at marginal conventional wells, which we expect to test in our East Texas operations. This work will allow us to demonstrate how 11 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report more efficient, high-performance solutions provide the opportunity for Diversified to continue as a leader with our stewardship approach to managing mature producing assets. While the recent U.S. presidential election and related changes in government administration may alter the expected timing or quantum of these funds, this project is just one example of how we are consistently pursuing new technology to reduce emissions while improving efficiencies per our Smarter Asset Management approach to operations. Climate-Related Risks & Opportunities We continue to evolve and refine our approach to climate-related risks and opportunities (“CRROs”). As in prior years, and with the support and input of an independent global consultancy, we identified these CRROs through workshops with Diversified executive and senior leadership and through research of both U.S. peer and international energy companies. We subsequently high-graded our CRROs based on the likelihood of their occurrence and the potential financial impact, as measured by net asset value (“NAV”) and free cash flow, they might have on our business in the short-, medium- and long-term. The tables below show our most significant transition risks, physical risks, and transition opportunities, as defined by the greatest likelihood of occurrence and/or highest financial impact. Refer also to Scenario Analysis below within this Climate Report for consideration of the Group’s portfolio resilience to multiple future climate scenarios. Timeframe: S Short-term (2025-2027) M Medium-term (2028-2031) L Long-term (2032 and beyond) KPIs: As defined in Key Performance Indicators within in this Annual Report. Transition Risks We have linked our highest-rated transition risks to our key performance indicators (“KPIs”) and assessed our business readiness for each CRRO. Additionally, we have conducted climate scenario modeling to test the resilience of our portfolio against climate-related transition risks. The results of this scenario analysis are presented in a subsequent section. RISK CATEGORY Ø MARKET TECHNOLOGY POLICY & LEGAL Risk Consumer Sentiment Capital Access Alternative Energies Regulation/Cost of Carbon Timeframe M .. L S .. M .. L M .. L M .. L Description The risk of a reduction in customer demand for fossil fuel products arises from changes in consumer preferences. Global transition actions or expectations drive US market actions at a faster rate or different path than the Group's expectation, impeding access to capital or increase the cost of capital to finance corporate growth. Faster than expected adoption or lower cost of alternative energies outside the Group's preferred opportunity set increase direct competition with fossil fuels. Evolving regulatory environment and associated carbon pricing or fee mechanisms lead to increased operational costs. KPI Relevance/ Impact 1 2 4 1 2 4 1 4 5 1 2 3 4 5 Potential Impact on Business and Strategy Reduced revenue resulting from lower demand or sustained decrease in price for products could create stressed assets. In turn, this could impact cash flows, the remaining producing lives and value of our portfolio, and our ability to deliver competitive shareholder returns. The Group may face increased cost of capital, and reduced or more conditional access to capital, if it is unable to meet evolving investor, societal and regulatory expectations. As a result, the Group may not have sufficient funds to reinvest in its existing assets or to fund growth through capital investments and M&A as outlined in our strategy. Rapid or low-cost advancements in renewable and other lower carbon substitutes can redirect stakeholder interest and reduce available capital, leading to faster-than- expected declines in the use of fossil fuels. The Group must remain diligent to explore and advance potential alternative energies or solutions that support the use, in some way, of fossil fuels. The Group may face more demanding regulatory requirements, increased cost of doing business as a fossil fuel- focused company, or reduced competitiveness versus other forms of energy. 12 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report RISK CATEGORY Ø MARKET TECHNOLOGY POLICY & LEGAL Current Mitigating Actions • Demonstrated methane intensity improvement delivered through effective emission reduction actions • Scenario analysis of portfolio resiliency provides strategic direction, and natural gas-weighted portfolio projected to remain resilient through the energy transition • Low-cost production offers resilience in lower commodity price environment • Consistent market engagement • Robust hedging strategy provides financial protection against commodity price volatility, thus offering cash flow availability for reinvestment • ~80% of portfolio currently in fixed rate debt with amortizing payments, offering significant protection in the short/mid- term • ABS financing mechanisms remain readily available, with certain borrowings offering improved rates and financing capacity when sustainability-aligned • Demonstrated investment in leading edge technologies for emissions reduction, equipment conversion • Active technology collaboration, partnerships and leadership • Scenario analysis shows that natural gas plays an important role throughout the energy transition, even in a net zero scenario • Proactively engage in multiple voluntary emissions measurement and reduction initiatives to reduce carbon footprint • Carbon footprint analysis undertaken in M&A process and investment decisions • Participate in field tests and small-scale pilot projects to optimize the prioritization of carbon reduction projects • Actively monitor global and domestic policy and legal developments Business Readiness Current corporate practices for planning and engagement support key tenet of business model in low-cost production Hedging and ABS financing are strategic pillars of business model Expanding track record of advancing leading edge solutions supported through scenario analysis Remain proactive in identifying, prioritizing and engaging in carbon reduction initiatives to minimize carbon-related fees Physical Risks Leveraging the analysis we completed in 2023 (which can be referenced in our 2023 Sustainability Report as found on our website at www.div.energy), we re-examined our exposure to four key physical risks with the most potential to impact our operations - extreme rainfall, hurricanes, water stress and heat stress. Our relative exposure to these physical risks was measured as a function of the percent of Diversified's projected 2040 operated production in high or extremely high-risk areas as identified in our analysis. Physical Risk % of Projected 2040 Operated Production in High or Extreme Risk Areas Acute Risk Extreme Rainfall 77% Hurricanes 8% Chronic Risk Water Stress 28% Heat Stress 42% Our 2024 assessment showed that extreme rainfall, water stress and heat stress continue to present a moderate to high impact risk potential to our operated portfolio. Given our understanding of the physical risks to which our assets are exposed, we do not expect any one individual risk identified below to be material to the business in the short, medium or long-term, largely as a function of the geographic dispersion of our asset base. We maintain a strong, proactive culture of emergency preparedness to support a prompt and effective response in the event of an emergency. This preparedness includes localized operational response plans as well as corporate business continuity and crisis communication plans that take effect, as and when warranted, based on the nature and severity of the climate event. Our emergency preparedness is a direct reflection of a corporate culture that supports prioritizing the safety and protection of both personnel and assets. RISK CATEGORY Ø ACUTE CHRONIC Risk Extreme Rainfall Water Stress Heat Stress Geography Potentially at Risk 79% of total operated proved reserves (risk applicable to asset portfolio, except in Oklahoma and Alabama where extreme rainfall was categorized as less than high) 28% of total operated proved reserves (risk applicable to asset portfolio, except in Virginia, West Virginia, Kentucky, Tennessee, Alabama, and Louisiana where water stress was categorized as less than high) 38% of total operated proved reserves (risk applicable to asset portfolio, except in Pennsylvania, Alabama, and Louisiana where heat stress was categorized as less than high) Timeframe S .. M .. L M .. L M .. L Description Excessive rainfall and the associated risk of flooding represent the highest risk to our assets in the Appalachia Basin in 2040, especially in Kentucky, Ohio and West Virginia, where our exposure is characterized as extreme. Water stress is a moderate chronic physical risk for our overall portfolio in 2040, though a high risk in particular for our assets in Texas and Oklahoma Heat stress, considered from the perspectives of personnel and infrastructure, is likely to have a moderate-to-high impact on our portfolio, with the highest exposure in Oklahoma, Kentucky, West Virginia and Virginia. KPI Relevance/ Impact 1 2 3 4 1 2 3 4 6 1 2 3 4 7 13 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report RISK CATEGORY Ø ACUTE CHRONIC Potential Impact on Business and Strategy • Decreased production or damaged infrastructure resulting in lost revenue • Inability of third parties (i.e., processing, gathering & transportation) to receive sales production • Increase in emergency response or capital costs • Supply chain and logistics disruptions and/or cost increases • Decreased portfolio value • Decreased workforce productivity • Increased operating costs and/or change in water-reliant maintenance procedures • Decreased production • Decreased ability to retire assets • Risks to the health and safety of personnel • Increased operating costs • Decreased workforce productivity Current Mitigating Actions • 24/7 monitoring centers, with faster response to weather-related disruptions • Equipment maintenance or redundancy • Production re-routing capabilities on expansive owned midstream system • Expansive and diverse supplier network • A business strategy focused on acquisitions rather than water-intensive drilling and development • Seek to minimize freshwater consumption while increasing produced water recycling programs • Maintain appropriate levels of insurance to mitigate losses • Effectuating operating procedures to protect against harsh environments • Inspection and maintenance of safety critical equipment and control systems • Dedicated programs through EHS and Human Resources to support physical well-being and safety • Effectuating operating procedures to protect against harsh environments • Inspection and maintenance of safety critical equipment and control systems Climate-Related Opportunities We believe that efforts to mitigate and adapt to climate change also produce opportunities for growth or changes in business strategies as we seek to improve our carbon footprint and achieve our climate-related goals. In a similar manner as to climate-related risks, we high-graded the identified climate-related opportunities based on their relevance to our climate strategy, the likelihood of our participation, and the greatest impact on our short- to medium-term business model. The table below outlines those high-graded climate-related opportunities. OPPORTUNITY CATEGORY Ø RESOURCE EFFICIENCY ENERGY USE/ PRODUCTS & SERVICES MARKETS Opportunity Emissions Detection Equipment Technology Differentiated Gas Sales Incentives Timeframe S .. M .. L S .. M .. L S .. M .. L S .. M .. L S .. M Description Advanced, proactive detection supports emission reduction goals while advancing environmental stewardship. Equipment upgrades may include replacements of natural gas-driven pneumatics with alternative energy sources and right-sizing or conversion of compression equipment. Pursuit of low-carbon technology collaboration and partnerships in coal mine methane, alternative energy credit generation, waste heat recovery, hydrogen generation, solid oxide fuel cells, and geothermal or other non-fossil methane pilot projects. Differentiated gas includes OGMP Gold Standard or other differentiated gas recognitions which support our efforts to market natural gas with demonstrably lower methane emissions. Use of public sector or government incentives provides additional capital resources to support actions focused on climate-related risks and opportunities. KPI Relevance 2 3 4 5 2 3 4 5 2 3 4 5 2 4 1 5 14 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report OPPORTUNITY CATEGORY Ø RESOURCE EFFICIENCY ENERGY USE/ PRODUCTS & SERVICES MARKETS Potential Impact on Business and Strategy Reduced emissions related to improved efficiencies contribute to increased products available for sales. When coupled with efficiency-driven reductions in fuel and operating costs, this would directly and positively impact revenues and cash flows and therefore opportunities for reinvestment to drive to additional shareholder value. Replacement or upgrades of inefficient, redundant or excess equipment supports financial position and corporate value through increased revenue and/ or decreased operating costs and satisfies increasing regulatory requirements for reduction of natural gas-driven devices. Application of new, diverse and more efficient technologies supports lower carbon energy pathways and provides enhanced revenue opportunities through the generation of voluntary and regulated carbon credits for own use or sales to third parties. Such technologies also provide opportunities for reduced operating costs and reduced exposure to carbon costs. Differentiated gas offerings to market can generate increased revenue from customers seeking increased levels of transparency on product and emissions actions while also supporting targeted risk management of those assets best suited for continuous monitoring. Public sector incentives provide ability to accelerate advancement of lower carbon opportunities, particularly in proven or evolving technologies such as fuel cells and waste heat recovery. Such funding carries with it increased levels of transparency on product and emission reduction actions and allows for better response to risks and increased business continuity. Contributory Actions • Continued investment in improved leak detection and aerial surveillance • Utilize asset management system to monitor equipment lifecycles and identify focus programs • Utilize emissions intelligence digitization and automation, supporting both emissions reporting and project prioritization • Expanded collaboration and innovation to drive solutions • Continued investment in equipment replacement • Utilize 24/7 Integrated Operations Centers (“IOC”) to identify and respond to potential abnormal events related to equipment • Consistent, proactive monitoring and application (as appropriate) of new, more efficient technologies • Revisiting capital allocation strategies as warranted • Active and expanding use of continuous monitoring devices • Dedicated marketing efforts to expand customer base and/or market engagements • Active monitoring of grant application processes, leveraging jurisdictional/ geographical diversity for access to funding • Sector engagement and industry collaboration promote awareness of funding opportunities Business Readiness Current practices coupled with ongoing evaluation for expanded applications IOC detection and response delivering results; consistently seeking innovative solutions Announced coal mine methane project and actively pursuing, including with collaborative partners, and prioritizing projects accordingly Achieved third consecutive year of OGMP Gold Standard Pathway and consistently evaluating additional differentiation opportunities Actively pursuing as standalone recipient or as part of a collaborative cohort Portfolio Resilience We used climate scenario modeling to test the resilience of our portfolio, in line with the TCFD / IFRS S2 guidance. These scenarios incorporate different assumptions regarding the progression of the global energy transition, including variations in commodity prices and demand. Scenario Analysis We selected three scenarios to test our portfolio climate resilience: (a) International Energy Agency’s (“IEA”) Stated Policies Scenario (“STEPS”) (b) IEA Announced Pledges Scenario (“APS”) (c) Wood Mackenzie’s (“WM”) Accelerated Energy Transition 1.5-degree pathway (“AET 1.5”), a global net zero by 2050 scenario We summarized key assumptions of each scenario in the table below. 15 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Key Scenario Assumptions(a) IEA STEPS IEA APS WM AET 1.5 Global temperature outcome in 2100 (°C) 2.4° 1.8° 1.5° 2030 Outcome 2025-2050 CAGR 2030 Outcome 2025-2050 CAGR 2030 Outcome 2025-2050 CAGR Oil demand (TJ(b) ) 195,141,000 0% 178,410,000 (2)% 176,796,071 (5)% Gas demand (TJ) 144,673,000 0% 130,208,000 (2)% 140,630,753 (2)% Coal demand (TJ) 151,602,000 (2)% 134,024,000 (5)% 149,421,127 (7)% Nuclear (TJ) 35,845,000 2% 38,587,000 3% 37,122,199 4% Renewables (TJ) 120,062,000 5% 139,519,000 6% 71,486,029 6% Bioenergy (TJ) 14,585,000 1% 6,425,000 2% 57,955,725 1% Oil price ($/Bbl) $81.05 0% $73.87 (1)% $53.00 (3)% Natural gas price ($/Mcf) $3.86 1% $3.16 0% $3.66 1% CO2 emissions (MT) 36,170 (1)% 32,056 (4)% 32,867 Net zero (a) IEA data for the Stated Policies and Announced Pledges scenarios based on the IEA (2024) World Energy Outlook, www.iea.org/weo, rebased to real 2024 pricing (b) Total Primary Energy Demand, in Terra Joules (TJ) Portfolio Impact We have assessed the potential impact of each scenario on our current portfolio, in terms of NAV change in percent versus our Base Case financial model. No account is taken of the impact that future acquisitions or divestitures may have on our forward business value and cashflows. The results of the modeling are shown in the table below, represented by a net change in portfolio value as measured by the net present value of cashflows discounted at a 10 percent rate (“NPV10”). Scenario Portfolio Value Impact (NPV10) IEA STEPS 13% IEA APS (15)% WM AET 1.5 (5)% The 2024 results showed a potential upside to our NAV under the IEA STEPS scenario. This upside is underpinned by robust U.S. gas prices out to 2050, including $4.31/MMBtu in 2050. We also continue to demonstrate a conservative approach to financial planning, with our Henry Hub price forecast assuming forward strip prices through 2030, while staying flat thereafter near $3.60/MMBtu post-2030. The higher positive NAV change under the STEPS scenario can be attributed to much higher Henry Hub prices than in our Base Case, which when coupled with Diversified's front-loaded production outlook, significantly increases the value of assets. A summary of the unlevered free cashflows under each pricing scenario is presented as follows (in millions): Production volumes between 2025 and 2034 account for over 55% of the total production during 2025-2049. During this timeframe, natural gas prices are higher in the STEPS scenario, averaging ~$3.75/MMBtu versus an average of ~$3.70/MMBtu under WM AET 1.5. Conversely, WTI prices between 2025 and 2034 average ~$81.50/bbl and ~$54.25/bbl in the STEPS and WM AET 1.5 scenarios, respectively. Wood Mackenzie's strong outlook for Henry Hub natural gas prices in the AET 1.5 scenario is underpinned by the dynamics of oil and gas fundamentals in the US, where lower oil prices support natural gas to the upside out to the middle of the next decade. 16 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Given the market dynamics and our status as a low-cost producer, we are well positioned to sustain profitable operations throughout our portfolio until 2050. Our analysis indicates that even in the most carbon-constrained AET 1.5 scenario, our portfolio would remain resilient and profitable, with free cash flow remaining positive in the short-, medium- and long term, as shown above. Unless there are significant changes in the regulatory environment in the near future, we do not expect to see a significant financial impact of climate- related risks on our near-term cash flows. Post-2030, our conservative commodity price assumptions, used for Diversified’s financial planning and opportunity screening, position us well to cope with the potential introduction of carbon taxes in the U.S. or falling commodity prices. Carbon Pricing Considerations We apply carbon pricing in our business primarily in relation to portfolio investments and project planning in our field-based emission reduction efforts and in our acquisition target screening. We maintain a database of current and proposed methane reduction projects as part of our MACC to help inform investments and next steps in our de-methanization efforts. Carbon pricing for acquisitions is most visible through the metric of carbon and methane intensity. Acquisition targets are pre-screened to determine if they are accretive or dilutive to Diversified’s current methane intensity. We consider known emission reduction methods as may be applied to the target assets through our Smarter Asset Management program to determine a pro-forma reduction profile. We then apply cost factors from recent reduction projects and current market data to attain the forecasted reductions and an expected emission reduction price in U.S. dollars per metric ton of carbon dioxide equivalent ($/MT CO2e). Risk Management - A Comprehensive Approach Effective risk identification and control is a key component to the successful execution of our business strategy and objectives. Our company-wide Enterprise Risk Management (“ERM”) program - developed to improve resilience to anticipated risks, minimize unexpected risks, support the achievement of strategic objectives, and create sustainable value for our stakeholders – incorporates climate risk, for which our Board- approved corporate Climate Policy addresses our commitment to lowering the carbon intensity of our produced energy through emission reductions and other actions. At the same time, we acknowledge that qualifying and quantifying risks is a difficult and evolving exercise due to the uncertainty surrounding climate impacts and the rapidly and frequently changing regulatory and policy environment. Risk Management Process Step 1 - Risk Identification Step 2 - Risk Assessment Step 3 - Risk Response Step 4 - Risk Reporting • Confirm risk appetite • Consider key business objectives • Affirm risk universe & identify principal risks • Assess likelihood, impact and velocity • Identify key controls • Consider legal, reputation and business exposure • Accept or remediate current risk & control environment • Determine corrective action, if needed • Senior leadership • Executive management • Board of Directors Risk Identification Our risk management framework is designed around our risk appetite, as determined by our Board, which seeks to determine the nature and extent of the risks that the Group is willing to take, or consciously accept, to achieve its strategic objectives. To identify both risks and opportunities, we rely on a number of avenues, foremost including discussions with business unit leaders and internal subject matter experts across our organization as well as the experience and expertise of our Board. We actively engage with peers, industry associations and third-party experts with knowledge of current and emerging industry- or company-specific risks or opportunities. We also have the opportunity to identify issues with the greatest impact on our business, whether risks or opportunities, through ongoing stakeholder engagement and our periodic corporate materiality assessment with both internal and external stakeholders. As part of our most recent formal materiality assessment conducted in 2023, climate and the management thereof was identified by our stakeholders as a top 25 issue for the Group. As a result of this stakeholder view, in 2024 we updated our register of unique climate-related risks and opportunities that could impact our business (across all business functions and operating regions) during a series of workshops hosted by the Sustainability group and inclusive of executive and senior management leadership representing business areas such as upstream and midstream operations, asset retirement, business development, emissions, policy and regulation, and risk management. Further, we continuously monitor sustainability performance tracking based on analyses from ESG rating agencies such as MSCI, where these agencies serve as valuable resources for identifying new risks and related opportunities for improvement in our current risk policies, controls or mitigation actions. We also consider engagement with and information provided by industry bodies such as the OGMP and the Natural Gas Sustainability Initiative to help ensure that our approach to climate risk, particularly the decarbonization of our operations, follows best practice. Risk Assessment In alignment with the stakeholder views in our 2023 materiality assessment and partially as a function of its potential to also influence several other Principal Risks, we have delineated Climate as a Strategic Risk within Diversified’s total risk universe. We recognize that the transition to a lower-carbon future, inclusive of both physical and transition risks, could have significant implications for our corporate strategy and could negatively impact our financial results due to lower demand and/or lower prices for natural gas and oil. As such, our corporate finance team provides an assessment of the financial impact of certain climate-related risks on the Group’s financial position and liquidity, as more fully discussed within the Notes to the Group Financial Statements within this Annual Report. The size and scope of market-related climate risks are also assessed, quantified and planned for through scenario analysis as detailed in the Strategy section of this Climate Report. Equally, we recognize that physical risks related to climate variability, such as extreme rainfall, water stress, and heat stress, could impact our operations. Therefore, the Strategy section also includes more information on the impact of specific acute and chronic physical risks on our portfolio, including mitigation and adaptation actions. 17 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Risk Response As described in part in the Governance section of this Climate Report and depicted below, Climate Risk management begins with the Board’s responsibility to ensure that Climate Risk is ultimately addressed and mitigated through the Group’s corporate strategy and business model and within the Board’s risk appetite. Assuming oversight responsibility of Climate Risk on behalf of the Board, the Sustainability & Safety Committee monitors company performance on operational climate mitigation activities and energy transition adaptation plans by actively engaging with executive and senior management on these topics. Under the direct oversight of an Executive Risk Owner, a designated Principal Risk Owner is primarily responsible for identifying and implementing mitigating controls and action plans for managed risks in order to remove or minimize the likelihood and impact of the risk before it occurs. Climate Risk Management As a company, we monitor emerging energy transition trends and shifting conditions in the energy industry – ranging from new climate-related regulatory requirements to global climate impacts – so that we are prepared to respond accordingly. Such a response may include policy or procedural changes, or additional resources or training to mitigate the emerging risks. Our risk management framework includes a system of internal control whereby our Internal Audit group is responsible for annually engaging all Principal Risk Owners to assess the effectiveness of the risk management and mitigation plans that were developed and deployed. Risk Reporting Each Principal Risk is assigned to a Principal Risk Owner, a member of senior management who identifies and develops mitigating controls and future opportunities for mitigation as part of the risk scorecard process. Throughout the year, the Principal Risk Owner responsible for actively monitoring and managing the risk is likewise responsible for periodically updating the risk scorecard. As part of our ERM program, the role of Principal Risk Owner for Climate Risk is assigned to the Senior Vice President-Sustainability. This Risk Owner, other senior management team members, the Executive Risk Owner, and the CEO regularly engage in risk discussions across all areas of our operations, ensuring climate-related risks are integrated into the Group’s overall and ongoing risk management considerations, processes and actions. This healthy dialogue regarding risk creates a culture that highly regards risk mitigation as a way to preserve and create value for our stakeholders. As a standing invited guest to the Sustainability & Safety Committee meetings of the Board, the Climate Risk Owner also regularly shares with the Committee the Group’s actions and mitigating activities regarding Climate Risk. Refer to Risk Management Framework within this Annual Report for additional information. Metrics & Targets - Identify, Monitor, Improve We utilize quantifiable measures as a roadmap to align our strategic objectives and decision-making with intentional actions that drive our success. We remain focused on near-term efforts to reduce the methane intensity of our operations. As shared in the Strategy section of this Climate Report, we are partnering our daily Smarter Asset Management operational actions with the adoption of technology and the ingenuity and creativity of our teams to foster cost-effective, innovative solutions to emissions measurement and reduction. While we remain steadfast in our daily operational and environmental improvement actions, we do so through the lens of an ever-evolving regulatory reporting environment which has the potential in future periods to increase reported emissions through the addition of new requirements and new source categories not previously reportable. As such, we continue to monitor those regulations alongside advancing other lower carbon initiatives and evolving technologies, which collectively serve as guideposts to next steps in our emissions reduction journey. Climate-Related Metrics and Targets As reflected below and in more detail within our annual Sustainability Report, we use a variety of metrics to assess the Group’s exposure to climate- related risks and opportunities as well as the impact of our activities on external stakeholders, society and the planet. In line with certain Sustainability Accounting Standards Board (“SASB”) reporting guidelines and with proposed disclosures under the IFRS S2 requirements subject to public consultation prior to potential adoption by the UK government, two primary areas we monitor for climate impacts include GHG emissions and water management. GHG Emissions A focus on reducing GHG emissions associated with our operations has long been a part of our Smarter Asset Management operating philosophy and is directly impacted by the climate-related market and technology transition risks and transition opportunities noted in the Strategy discussion within this Climate Report. Given their business impact and stakeholder relevance of our emissions profile, our reported Scope 1 and 2 emissions are being assured again this year (with expected completion in 2Q2025) by independent third-party ISOS Group Inc. The moderate Level II (limited) assurance utilizes the AccountAbility 1000 Assurance Standard (v3). Our GHG emissions calculations embed the following assumptions: • All calculations are as of December 31, 2024; • All emissions are presented as gross; • All emissions represent operational control (as if operated for the entire calendar year); 18 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report • Scope 1 emissions are reported as per the U.S. EPA Greenhouse Gas Reporting Program (“GHGRP”), excluding certain Scope 1 fuels which are not covered by 40 CFR Part 98 Subpart W (“Subpart W”) reporting; • Scope 2 emissions (location-based) are reported as per the IPCC Guidelines for National Greenhouse Gas Inventories (AR5) as GHGRP does not contemplate Scope 2 reporting; and • 2024 emissions include the impact of changes in calculation methodology for pneumatic devices, pneumatic pumps and storage tanks to align with Subpart W. These changes were not retroactively applied to prior years’ reported emissions. Excluding the impact of acquisitions during the year, we reduced our year-over-year Scope 1 methane emissions by 20% to 336 thousand metric tons (“MT”) of carbon dioxide equivalent (“CO2e”) and total Scope 1 GHG emissions by 7% to 1,454 thousand MT CO2e. These reductions were largely a function of the maturity and significance of our comprehensive voluntary LDAR programs, where we maintained a 98% no-leak rate, but were also influenced by changes in calculation methodology for fugitive emissions and storage tanks to align with Subpart W reporting requirements. Total Scope 1 GHG emissions increased 2% year over year to 1,593 thousand MT CO2e when including the impact of 2024 acquisitions. While total Scope 1 methane emissions experienced an incremental increase from 336 thousand MT CO2e to 364 thousand MT CO2e as a result of acquisitions, significant efforts toward methane reduction still drove a 13% annual decline in methane intensity to 0.7 MT CO2e/MMcfe natural gas. As compared to our original 2020 baseline Scope 1 methane intensity of 1.6 MT CO2e/MMcfe, the compounding effect of our actions to reduce our methane emissions has delivered a 56% decrease in methane intensity to year end 2024. During this four-year period of time, we’ve also strategically grown the Group through ten separate acquisitions that included our entry into a new operating region in Central, which drove a more than 30% increase in average daily net production and now represents 50% of year-end 2024 total production. In the last four years alone, we have cumulatively eliminated more methane emissions than we took on through acquisitions, demonstrating our commitment and actions toward environmental stewardship. Scope 2 emissions remained relatively flat year-over-year at 53 thousand MT CO2e. The strength of our emission reduction efforts helped offset the addition of emissions from acquisitions in the period where total Scope 1 and 2 GHG emissions increased just 1% year over year to 1,646 thousand MT CO2e. We are continuing to assess and adapt to the changing US regulatory emission reporting environment, which now also includes a recent change in US government administration that has created additional regulatory uncertainty. We will consider these emissions inventory reporting changes along with operational changes such as acquisitions and divestitures, the availability and applicability of new emissions detection and quantification technologies, and stakeholder priorities when determining any updated interim targets for emissions reductions. Unit 2024 2023 2022 GHG Emissions Scope 1 Emissions:(a) thousand MT CO2 e 1,593 1,561 1,820 Carbon Dioxide thousand MT CO2 1,228 1,140 1,130 Methane(a) thousand MT CO2 e 364 420 686 Nitrous Oxide thousand MT CO2 e 1 1 4 % Methane % 23 27 38 Scope 1 Methane Intensity MT CO2 e/MMcfe 0.7 0.8 1.2 Scope 1 Methane Intensity - NGSI(b) % 0.10 0.11 0.21 Scope 1 Emissions Attributable to:(c) Flared Hydrocarbons thousand MT CO2 e 0.8 0.0 0.0 Other Combustion thousand MT CO2 e 1,253 1,178 1,173 Process Emissions thousand MT CO2 e 76 92 67 Other Vented Emissions thousand MT CO2 e 140 63 182 Fugitive Emissions thousand MT CO2 e 123 228 399 Scope 2 Emissions(a) thousand MT CO2 e 53 61 59 Energy consumption million kWh 130 134 128 Total Scope 1 and Scope 2(a) thousand MT CO2 e 1,646 1,622 1,879 Scope 1 and Scope 2 GHG Emissions Intensity(a) MT CO2 e/MMcfe 3.2 3.1 3.4 Air Quality(d) Nitrogen Oxide (NOx, excluding N2 O) metric tons 22,736 21,520 21,546 Carbon Monoxide (CO) metric tons 19,457 18,448 18,530 Sulfur Oxide (SOx) metric tons 53 61 108 Volatile Organic Compounds (VOC) metric tons 2,366 3,108 4,421 Particulate Matter (PM Total) metric tons 145 137 140 Totals may not sum due to rounding. (a) Based on a 100-year global warming potential of 28 for methane, in line with IPCC’s Fifth Assessment Report (AR5). 19 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report (b) Using the Natural Gas Sustainability Initiative (“NGSI”) protocol, and to support direct comparability among the industry’s producers, represents methane intensity using methane emissions from production assets only (therefore, excluding gathering & boosting facilities) divided by gross natural gas production. (c) Reflects Sustainability Accounting Standards Board categories for reporting Scope 1 GHG emissions (EM-EP-110a.2) in line with the Oil & Gas – Exploration & Production Sustainability Accounting Standard (October 2018). (d) 2022 was recast from previous disclosures to mirror like computations in 2023 and 2024, inclusive of updated calculation assumptions and new approved reporting protocols, thus improving year-over-year comparability. Disclaimer: GHG emissions were calculated per IPCC/GHGRP reporting guidance, which permits best engineering estimates for certain emissions categories, and which may vary from the prescriptive measures applied under U.S. EPA reporting standards. The source data used in these calculations were accurate and complete, to the best of our knowledge, at the time they were gathered and compiled. If new data or corrections to existing data are discovered, the Group may update emissions calculations as permitted and in accordance with industry standards and expectations. Such updates will be included in future reporting and posted to our website where such posts may take place without notice. Water Management Water can be a significant input for many companies within the energy sector, particularly those companies engaged in significant drilling and hydraulic stimulation activities. In contrast, our strategic focus on acquisitions limits our overall water consumption. Beyond domestic use, we use water in well maintenance, asset retirement and, as noted below, limited hydraulic stimulation activities. We source this water from multiple outlets, including freshwater outlets, municipalities, or recycled produced water. We actively monitor our water consumption and management practices across our operational footprint. Similar to 2022, in 2024, we participated as contract operator on 14 new drilled natural gas wells, though we own an ~10% working interest in just five of those wells. As operator of record, we included all of the water consumed in the hydraulic stimulation of these 14 wells in our water consumption activities for the year. In addition to water consumption, our water management practices include the disposition of wastewater produced from the geologic reservoirs in which we are active. Diversified’s operated assets are dispersed across nine different states within the US. When considering water stress as a climate-related physical risk as noted above, it is relevant to note that 99% of our 2024 production is located in U.S. counties classified as Low Overall Water Risk areas, as per the World Resources Institute’s Aqueduct Water Risk Atlas (accessed in September 2024 and assuming the oil and gas industry-specific weighting scheme which is most relevant for our business). We track the following water management metrics as part of our sustainability and climate-related actions: Unit 2024 2023 2022 % of reserves in baseline water stress areas(a) % 0.6% 2.8% 4.7% Total water consumed MBbls 3,327 879 2,817 Volume of produced water and flowback generated and disposed MBbls 27,758 30,444 22,742 Quantity of produced water and flowback (i) discharged, (ii) injected, (iii) recycled % (i) 0.02 (ii) 98.56 (iii) 1.42 (i) 0.05 (ii) 98.74 (iii) 1.21 (i) 0.06 (ii) 97.65 (iii) 2.29 Total water consumed intensity Bbl per Boe gross production 0.039 0.010 0.031 Fresh water consumed intensity Bbl per Boe gross production 0.038 0.008 0.029 (a) Represents high or extremely high baseline water stress areas, as per the World Resource Institute’s Aqueduct Water Risk Atlas, as percent of year-end total proved reserves, measured at the county level. Incentivizing Performance Our commitment to climate and business resiliency is reflected, in part, in our compensation plans for executives and senior leaders. Depending on their respective roles in the Group, these leaders have a proportion of their variable pay each year tied to the delivery of sustainability and climate-related targets. The Board and its Remuneration Committee annually review the appropriateness of the measures incorporated into the Executive Director’s annual bonus plan and have consistently increased the non-financial sustainability-related component within the plan. For the year ended 2024, this component represented 30% of the total eligible bonus, including a 15% environmental component directly related to methane intensity reductions and pneumatic valve replacements. This plan and its results are audited annually. Since 2022, 20% of the Executive Director’s long-term incentive plan (“LTIP”) also has been tied to non-financial climate targets. Audited annually, the LTIP contains a three-year vesting period with 20% of the incentive specifically tied to tactical methods to achieve additional methane intensity reductions in our climate journey. For the Executive Director in the 2025 calendar year, the annual bonus and LTIP percentages tied to non-financial sustainability-related performance remain at 25% and 20%, respectively. Similar short- and long-term climate-related incentive compensation metrics are also applicable to members of senior leadership who play an active role in executing the Group’s tactical emission reduction plans as well as executing other operational and environmental stewardship initiatives. For more information on the performance conditions attached to executive remuneration incentive arrangements, refer to the Remuneration Committee's Report within this Annual Report. 20 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Section 172 Companies Act Statement In compliance with sections 172 (‘Section 172”) and 414CZA of the UK Companies Act, the Board makes the following statement in relation to the year ended December 31, 2024 : Our stakeholders are the many individuals and organizations that are affected by or interact with our operations and with whom we therefore seek to proactively and positively engage. We strive to maintain productive, mutually beneficial relationships with each stakeholder group by treating all stakeholders with fairness and respect and by providing timely and effective information and responses. We maintain several communication methods that afford two-way engagement with our stakeholder groups, including interactions via face-to-face, telephone, or email exchange; published company reports, press releases, and investor presentations; industry or conference participation; and other company engagement. As the owner and operator of long-life assets, we aim to make decisions that consider both the long-term success of Diversified and value creation for our stakeholders. Engaging with our stakeholders informs our decision-making, including consideration of our long-term strategic objectives and the activities that support these aims, such as merger and acquisition diligence and the management of climate risk. The following information provides a summary of stakeholder engagements from 2024. Employees We know our employees are essential to our success and growth. We recognize the need for a skilled and committed workforce, with a diverse range of experience and perspectives, and we value the contribution it affords. Key Areas of Focus • Incident management • Employee, driver and process safety • Employee development • Workplace culture Action and Engagement Our CEO and other executive management periodically conduct town hall meetings and field visits to personally and directly engage with employees and to provide opportunities for employees to have direct management engagement. Our Board’s Non-Executive Director Employee Representative, Sandra M. Stash, also periodically engages with the workforce to receive employee feedback on our business strategy, corporate culture and remuneration policies, and shares this feedback with the Board. The valuable feedback from these meetings, along with that resulting from a periodic corporate-wide Employee Experience Survey, when applicable, is used to strengthen future employee engagement and initiatives. We also regularly conduct new hire surveys regarding the onboarding process and exit interviews, both important tools to further improve employee experiences. In 2024 , our CEO, accompanied by members of the executive and senior management teams, visited several locations across our operating footprint, conducting town hall meetings with some 60% of total employees and presenting updates on strategic operational and financial company initiatives. To better support our employees, we expanded our family-focused programs to include an Employee Adoption Program, which provides financial assistance and maternal or paternal leave for the adoption process, and further continued our focus on mental and physical well-being through health and fitness challenges and educational webinars. Communities We actively support sustainable socio-economic development in the communities in which we live and work and aim to minimize any potential negative impacts from our operations. Community engagement includes developing and maintaining trusted relationships with our land and mineral owners with the recognition that these relationships are key to our acquisitive business strategy and ability to achieve our operational goals. From personal and socio-economic investment to strategic academic and educational support, our employees engage and serve their local communities through effective partnerships that make a real difference. Key Areas of Focus • Incident management • Effective grievance mechanisms • Environmental protection • Royalty payments • Socio-economic investment and outreach • Local hiring Action and Engagement Through our formalized Community Giving and Engagement Program and other corporate initiatives throughout our operating footprint, in 2024 we provided approximately $2.1 million in financial support to numerous organizations, including adult and children’s health and well-being programs, local food banks, secondary and higher educational programs and initiatives, student athlete-related ventures and engagements, and municipal services. We were especially pleased to support children’s initiatives which included, for the fourth consecutive year, distributing $205,000 worth of winter coats to more than 2,700 children in nine schools through Operation Warm. We also supported 12 different foster care organizations and provided meals for the associated families and workers within these organizations. Our employees responded to more than 33,000 inquiries from our royalty and surface owners through our corporate call center. We also distributed approximately $167 million in royalty payments to more than 84,000 royalty owners in 2024. Equity and Debt Investors We actively engage with our capital market partners, financial institutions and rating agencies to support a full understanding of our business and progress against our strategic priorities. 21 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Key Areas of Focus • Emissions reductions • Climate risk and energy transition • Incident management • Risk management • Corporate Governance • Financial stability • Access to funding Action and Engagement We regularly provide financial, operational and other sustainability performance updates to our equity and debt investors. These updates may be in the form of investor relations presentations, press releases, website updates, or direct calls and meetings, inclusive of the CEO, CFO, SVP-Investor Relations, SVP-Sustainability, SVP-EHS and/or Board Chairman, as applicable. The Annual General Meeting (“AGM”) also provides an opportunity for shareholders to engage with the Board and Executive Management. Our increasing participation in energy conferences, industry events and non-deal roadshows has provided added opportunities for discussions with current and potential Credit Facility lenders and ABS investors particularly interested in our sustainability and emissions reductions strategies, activities and results. Reflective of that interest by ABS investors and our commitment to climate and operating targets, certain of our ABS transactions, as well as our sustainability-linked Credit Facility, have included interest rate impacts tied to certain of these sustainability targets. Governments We seek to develop and maintain positive relationships and regular dialogue with various stakeholder groups within our federal, state and local governments. Key Areas of Focus • Legal compliance • Tax payments to governments • Safe and efficient asset retirement • Emissions reductions • Risk management • Environmental protection Action and Engagement Executive and operational management engage with federal, state and local regulators to address legislative, regulatory and operational matters important to our company and our industry. With risk identification and protection of the local environment and biodiversity in mind, we proactively engage applicable regulatory agencies before commencing a project to foster transparent dialogue during the completion and approval of applicable environmental assessments and related actions. We seek to keep regulatory agencies appraised of our operational and well retirement activities and to provide objective and measurable progress indicators. Our Next LVL Energy well retirement subsidiary supports company efforts to exceed annual state plugging requirements and well retirement needs of other oil and gas operators in the Appalachia Region as well as the individual states in their respective federal orphan well retirement programs. Customers We believe hydrocarbon production is, and will continue to be, essential to supporting modern human life. Therefore, we work hard to deliver environmentally-focused, responsibly produced natural gas, NGLs and oil that satisfy regulatory requirements and meet the energy demands of our local communities and customers while supporting our climate goals. Key Areas of Focus • Incident management • Process safety • Access to funding Action and Engagement We delivered 791 MMcfepd in 2024 with no cited process and pipeline safety events or associated civil penalties. We continue to use our pipeline awareness programs to provide relevant information and education to those who interact with our assets or employees. Business Partners We aim to establish mutually beneficial relationships with our business partners. As operator, we work on behalf of our joint operating partners to safely and efficiently manage the assets and deliver our products. Further, we strive to develop strong relationships with our contractors and suppliers that are built on trust, transparency and quality products and services. Key Areas of Focus • Access to funding • Risk management • Employee and process safety • Accident prevention • Procurement management 22 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Action and Engagement We fulfill our responsibility as operator by responsibly managing the wells, ensuring payment of related expenses, and distributing to our joint interest partners the applicable revenues and royalties from the wells’ commodity sales. We use local contractors and suppliers in each of the states in which we conduct our operations. We engage the expertise and capability of a leading supply chain risk management firm to continuously screen and monitor contractor safety performance and compliance through stringent operating guidelines. With a network of approximately 700 contractors, this real-time monitoring helps to ensure our contractors are providing us with the necessary product and service quality to meet the expectations of our stakeholders and supports ongoing agreements with those contractors who satisfy our safety thresholds. Non-Financial & Sustainability Information Statement This section of the Strategic Report constitutes our Non-Financial & Sustainability Information Statement, produced to comply with the Non-Financial & Sustainability Reporting Directive requirements from sections 414CA and 414CB of the UK Companies Act 2006. The table below sets out where relevant information can be found within this Annual Report. Additional information will be available in our Sustainability Reports or on our website at www.div.energy. Our policies can be found on our website at www.div.energy/about-us/corporate-governance. Reporting Requirement Policies Reference within this Annual Report Page Environmental Matters Code of Business Conduct & Ethics Retire 3 EHS Our Approach to Sustainability 6 Climate Protecting Our Environment 6 Business Partners Serving Our Communities 7 Biodiversity Climate Report 7 Corporate Governance Policies 46 Employees Employee Relations Supporting Our Employees 6 Anti-Bribery & Corruption Corporate Governance Policies 46 Whistleblowing Code of Business Conduct & Ethics Human Rights Securities Dealing Human Rights Code of Business Conduct & Ethics Supporting Our Employees 6 Human Rights Corporate Governance Policies 46 Modern Slavery Business Partners Social Matters Code of Business Conduct & Ethics Our Strategy Supports Sustainability 6 EHS Supporting Our Employees 6 Human Rights Serving Our Communities 7 Tax Climate Report 7 Socio-Economic Corporate Governance Policies 46 Anti-Corruption & Anti-Bribery Anti-Bribery & Corruption Corporate Governance Policies 46 Whistleblowing Business Model Code of Business Conduct & Ethics Business Model 2 Strategy 2 Corporate Governance Policies 46 Principal Risks and Uncertainties Whistleblowing Risk Management Framework 32 Corporate Governance Policies 46 Non-Financial KPIs Code of Business Conduct & Ethics Key Performance Indicators 3 EHS Corporate Governance Policies 46 Climate 23 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Reporting Requirement Reference within this Annual Report Page Board oversight of climate-related risks and opportunities. Climate Report: Governance 8 Identifying, assessing and managing climate-related risks and opportunities. Climate Report: Climate-Related Risks & Opportunities 8 How processes for identifying, assessing and managing climate- related risks are integrated into the overall risk management process. Climate Report: Climate-Related Risks & Opportunities 8 Principal climate-related risk and opportunities arising in connection with operations. Climate Report: Climate-Related Risks & Opportunities 8 Time periods by reference to which risks and opportunities are assessed. Climate Report: Climate-Related Risks and Opportunities 11 Actual and potential impacts of the principal climate-related risks and opportunities on the business model and strategy. Climate Report: Climate-Related Risks and Opportunities 11 Analysis of the resilience of the business model and strategy, taking into consideration different climate-related scenarios. Climate Report: Climate-Related Risks and Opportunities 11 Targets used by the organization to manage climate-related risks and to realize climate-related opportunities and of performance against those targets. Climate Report: Metrics & Targets 19 KPIs used to assess progress against targets used to manage climate- related risks and realize climate-related opportunities and of the calculations on which those KPIs are based. Climate Report: Metrics & Targets 19 Financial Review Results of Operations Refer to APMs within this Annual Report for information on how certain of the metrics below are calculated and reconciled to IFRS measures. Discussion related to prior period results can be found in the Results of Operations section of our 2023 Annual Report on our website at www.div.energy. Year Ended December 31, 2024 December 31, 2023 Change % Change Net production Natural gas (MMcf) 244,298 256,378 (12,080) (5%) NGLs (MBbls) 5,980 5,832 148 3% Oil (MBbls) 1,568 1,377 191 14% Total production (MMcfe) 289,586 299,632 (10,046) (3%) Average daily production (MMcfepd) 791 821 (30) (4%) % Natural gas (Mcfe basis) 84% 86% Average realized sales price (excluding impact of derivatives settled in cash) Natural gas (Mcf) $1.90 $2.17 $(0.27) (12%) NGLs (Bbls) 25.17 24.23 0.94 4% Oil (Bbls) 74.71 75.46 (0.75) (1%) Total (Mcfe) $2.53 $2.68 $(0.15) (6%) Average realized sales price (including impact of derivatives settled in cash) Natural gas (Mcf) $2.57 $2.86 $(0.29) (10%) NGLs (Bbls) 24.32 26.05 (1.73) (7%) Oil (Bbls) 69.54 68.44 1.10 2% Total (Mcfe) $3.05 $3.27 $(0.22) (7%) Revenue (in thousands) Natural gas $464,600 $557,167 $(92,567) (17%) NGLs 150,513 141,321 9,192 7% Oil 117,146 103,911 13,235 13% Total commodity revenue $732,259 $802,399 $(70,140) (9%) Midstream revenue 32,535 30,565 1,970 6% 24 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Year Ended December 31, 2024 December 31, 2023 Change % Change Other revenue 30,047 35,299 (5,252) (15%) Total revenue $794,841 $868,263 $(73,422) (8%) Gain (loss) on derivative settlements (in thousands) Natural gas $164,452 $177,139 $(12,687) (7%) NGLs (5,055) 10,594 (15,649) (148%) Oil (8,108) (9,669) 1,561 (16%) Net gain (loss) on commodity derivative settlements(a) $151,289 $178,064 $(26,775) (15%) Total revenue, inclusive of settled hedges $946,130 $1,046,327 $(100,197) (10%) Per Mcfe Metrics Average realized sales price (including impact of derivatives settled in cash) $3.05 $3.27 $(0.22) (7%) Midstream and other revenue 0.22 0.22 — —% LOE (0.80) (0.71) (0.09) 13% Midstream operating expense (0.24) (0.23) (0.01) 4% Employees, administrative costs and professional services (0.30) (0.26) (0.04) 15% Recurring allowance for credit losses — (0.03) 0.03 (100%) Production taxes (0.12) (0.21) 0.09 (43%) Transportation expense (0.31) (0.32) 0.01 (3%) Proceeds received from leasehold sales(b) 0.14 0.09 0.05 56% Adjusted EBITDA per Mcfe $1.64 $1.82 $(0.18) (10%) Adjusted EBITDA margin 50% 52% Other financial metrics (in thousands) Operating profit (loss) $(43,026) $1,161,051 $(1,204,077) (104%) Net income (loss) $(87,001) $759,701 $(846,702) (111%) Adjusted EBITDA $472,309 $546,788 $(74,479) (14%) (a) Net gain (loss) on commodity derivative settlements represents cash (paid) or received on commodity derivative contracts. This excludes settlements on foreign currency and interest rate derivatives as well as the gain (loss) on fair value adjustments for unsettled financial instruments for each of the periods presented. (b) Proceeds received from leasehold sales consists of $27 million, $24 million and $2 million in cash proceeds received for leasehold sales during the years ended December 31, 2024, 2023 and 2022, respectively, less $14 million and $4 million of basis in leasehold sales for the years ended December 31, 2024 and 2023, respectively. Forward-Looking Statements This Annual Report contains forward-looking statements that can be identified by the following terminology, including the terms “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible,” or the negative of these terms or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this Annual Report and include, but are not limited to, statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial positions, liquidity, prospects, growth, strategies and the natural gas and oil industry. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Forward-looking statements are not guarantees of future performance and the actual results of our operations, financial position and liquidity, and the development of the markets and the industry in which we operate, may differ materially from those described in, or suggested by, the forward-looking statements contained in this Annual Report. In addition, even if the results of operations, financial position and liquidity, and the development of the markets and the industry in which we operate are consistent with the forward-looking statements contained in this Annual Report, those results or developments may not be indicative of results or developments in subsequent periods. A number of factors could cause results and developments to differ materially from those expressed or implied by the forward-looking statements including, without limitation, general economic and business conditions, the behavior of other market participants, industry trends, competition, commodity prices, changes in regulation, currency fluctuations, our ability to recover our reserves, our ability to successfully integrate acquisitions, our ability to obtain financing to meet liquidity needs, changes in our business strategy, political and economic uncertainty. Forward-looking statements may, and often do, differ materially from actual results. Any forward-looking statements in this Annual Report speak only as of the date of this Annual Report, reflect our current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to our operations, results of operations, growth strategy and liquidity. Investors should specifically consider the factors identified in this Annual Report which could cause actual results to differ before making an investment decision. Subject to the requirements of 25 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report the Prospectus Rules, the Disclosure and Transparency Rules and the Listing Rules or applicable law, we explicitly disclaim any obligation or undertaking publicly to release the result of any revisions to any forward-looking statements in this Annual Report that may occur due to any change in our expectations or to reflect events or circumstances after the date of this Annual Report. Production, Revenue & Hedging Total revenue in the year ended December 31, 2024 of $795 million decreased 8% from $868 million reported for the year ended December 31, 2023 , primarily due to a 6% decrease in the average realized sales price, excluding the impact of derivatives settled in cash, and 3% lower production which was primarily related to the sale of equity interest in DP Lion Equity Holdco in December 2023 along with normal declines. This decrease was partially offset by increased production as a result of the Oaktree, Crescent Pass, and East Texas II acquisitions in 2024. Including commodity hedge settlement gains of $151 million and $178 million in 2024 and 2023, respectively, total revenue, inclusive of settled hedges, decreased by 10% to $946 million in 2024 from $1,046 million in 2023 . The following table summarizes average commodity prices for the periods presented with Henry Hub on a per Mcf basis and Mont Belvieu and WTI on a per Bbl basis: Year Ended December 31, 2024 December 31, 2023 $ Change % Change Henry Hub $2.27 $2.74 $(0.47) (17%) Mont Belvieu 38.16 34.11 4.05 12% WTI 75.72 77.62 (1.90) (2%) Commodity Revenue The following table reconciles the change in commodity revenue (excluding the impact of hedges settled in cash) by reflecting the effect of changes in volume and in the underlying prices: (In thousands) Natural Gas NGLs Oil Total Commodity revenue for the year ended December 31, 2022 $1,544,658 $188,733 $139,620 $1,873,011 Volume increase (decrease) 4,717 22,935 (15,903) 11,749 Price increase (decrease) (992,208) (70,347) (19,806) (1,082,361) Net increase (decrease) (987,491) (47,412) (35,709) (1,070,612) Commodity revenue for the year ended December 31, 2023 $557,167 $141,321 $103,911 $802,399 Volume increase (decrease) (26,214) 3,586 14,413 (8,215) Price increase (decrease) (66,353) 5,606 (1,178) (61,925) Net increase (decrease) (92,567) 9,192 13,235 (70,140) Commodity revenue for the year ended December 31, 2024 $464,600 $150,513 $117,146 $732,259 To manage our cash flows in a volatile commodity price environment and as required by our SPV-level asset-backed securities, we utilize derivative hedging contracts that allow us to fix the per unit sales prices for our production. As of December 31, 2024, approximately 86% of our production was fixed through derivative hedging contracts over the next twelve months. The tables below set forth the commodity hedge impact on commodity revenue, excluding and including cash received for commodity hedge settlements: (In thousands, except per unit data) Year Ended December 31, 2024 Natural Gas NGLs Oil Total Commodity Revenue Realized $ Revenue Realized $ Revenue Realized $ Revenue Realized $ per Mcf per Bbl per Bbl per Mcfe Excluding hedge impact $464,600 $1.90 $150,513 $25.17 $117,146 $74.71 $732,259 $2.53 Commodity hedge impact 164,452 0.67 (5,055) (0.85) (8,108) (5.17) 151,289 0.52 Including hedge impact $629,052 $2.57 $145,458 $24.32 $109,038 $69.54 $883,548 $3.05 (In thousands, except per unit data) Year Ended December 31, 2023 Natural Gas NGLs Oil Total Commodity Revenue Realized $ Revenue Realized $ Revenue Realized $ Revenue Realized $ per Mcf per Bbl per Bbl per Mcfe Excluding hedge impact $557,167 $2.17 $141,321 $24.23 $103,911 $75.46 $802,399 $2.68 Commodity hedge impact 177,139 0.69 10,594 1.82 (9,669) (7.02) 178,064 0.59 Including hedge impact $734,306 $2.86 $151,915 $26.05 $94,242 $68.44 $980,463 $3.27 26 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Refer to Note 13 in the Notes to the Group Financial Statements for additional information regarding derivative financial instruments. Expenses (In thousands, except per unit data) Year Ended December 31, 2024 December 31, 2023 Total Change Per Mcfe Change Per Mcfe Per Mcfe $ % $ % LOE(a) $231,651 $0.80 $213,078 $0.71 $18,573 9% $0.09 13% Production taxes(b) 36,043 0.12 61,474 0.21 (25,431) (41%) (0.09) (43%) Midstream operating expenses(c) 70,747 0.24 69,792 0.23 955 1% 0.01 4% Transportation expenses(d) 90,461 0.31 96,218 0.32 (5,757) (6%) (0.01) (3%) Total operating expenses $428,902 $1.47 $440,562 $1.47 $(11,660) (3%) $— —% Employees, administrative costs and professional services (e) 86,885 0.30 78,659 0.26 8,226 10% 0.04 15% Costs associated with acquisitions(f) 11,573 0.04 16,775 0.06 (5,202) (31%) (0.02) (33%) Other adjusting costs(g) 22,375 0.08 17,794 0.06 4,581 26% 0.02 33% Non-cash equity compensation(h) 8,286 0.03 6,494 0.02 1,792 28% 0.01 50% Total operating and G&A expenses $558,021 $1.92 $560,284 $1.87 $(2,263) —% $0.05 3% Depreciation, depletion and amortization 256,484 0.89 224,546 0.75 31,938 14% 0.14 19% Allowance for credit losses(i) 101 — 8,478 0.03 (8,377) (99%) (0.03) (100%) Total expenses $814,606 $2.81 $793,308 $2.65 $21,298 3% $0.16 6% (a) LOE encompasses costs incurred to maintain producing properties. These costs include direct and contract labor, repairs and maintenance, emissions reduction initiatives, water hauling, compression, automobile, insurance, and materials and supplies expenses. (b) Production taxes consist of severance and property taxes. Severance taxes are typically paid on produced natural gas, NGLs and oil at fixed rates set by federal, state or local taxing authorities. Property taxes are generally based on the valuation of the Group’s natural gas and oil properties and midstream assets by the taxing jurisdictions. (c) Midstream operating expenses are the daily costs of operating the Group’s owned midstream assets, including employee and benefit expenses. (d) Transportation expenses are the daily costs incurred from third-party systems to gather, process, and transport the Group’s natural gas, NGLs and oil. (e) Employees, administrative costs and professional services include payroll and benefits for our administrative and corporate staff, costs of maintaining administrative and corporate offices, managing our production operations, franchise taxes, public company costs, fees for audit and other professional services, and legal compliance. (f) Costs associated with acquisitions are related to the integration of acquisitions, which vary for each acquisition. For acquisitions classified as business combinations, these costs include transaction costs directly associated with a successful acquisition. They also encompass costs related to transition service arrangements, where the Group pays the seller of the acquired entity a fee to manage G&A functions until full integration of the assets. Additionally, these costs include costs to cover expenses for integrating IT systems, consulting, and internal workforce efforts directly related to incorporating acquisitions into the Group’s systems. (g) Other adjusting costs include items that affect the comparability of results or are not indicative of ongoing business trends. These costs consist of one-time projects, contemplated transactions or financing arrangements, contract terminations, deal breakage and/or sourcing costs for acquisitions, and unused firm transportation. (h) Non-cash equity compensation represents the expense recognition for share-based compensation provided to key members of the management team. Refer to Note 17 in the Notes to the Group Financial Statements for additional details on non-cash share-based compensation. (i) Allowance for credit losses consists of the recognition and reversal of credit losses. Refer to Note 14 in the Notes to the Group Financial Statements for additional information regarding credit losses. Operating Expenses Per unit operating expense remained flat year-over-year, resulting from: • Higher per unit LOE that increased 13%, or $0.09 per Mcfe, which is reflective of the Oaktree, Crescent Pass, and East Texas II acquisitions in 2024. • Lower per unit production taxes that declined 43%, or $0.09 per Mcfe were primarily attributable to a decrease in severance and property taxes as a result of a decrease in revenue due to lower production and commodity prices, as well as lower valuations for property taxes experienced during the year; • Higher per unit midstream operating expense that increased 4% , or $0.01 per Mcfe were primarily attributable to the growth in our midstream operations due to Central region expansion; and • Lower per unit transportation expenses that declined 3% , or $0.01 per Mcfe, were primarily related to decreases in commodity price-linked components of third-party midstream rates and costs. General and Administrative Expense G&A expense increased primarily due to: • Higher employees, administrative costs and professional services resulting in additional cost to support our ongoing growth through acquisitions. On a per Mcfe basis, these costs increased 15%, or $0.04 per Mcfe; • Lower costs associated with acquisitions primarily related to a reduction in legal and consulting services incurred in 2024 as compared to 2023. On a per Mcfe basis, these costs decreased 33% or $0.02 per Mcfe; 27 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report • Higher other adjusting costs primarily related to increased costs associated with litigation expense. These costs were partially offset by decreases in costs related to unused firm transportation and employee severance costs. On a per Mcfe basis, these costs increased 33% , or $0.02 per Mcfe; and • Higher non-cash equity compensation due to an increase in the number of participants in the long-term incentive plan in 2024. On a per Mcfe basis, these costs increased 50%, or $ 0.01 per Mcfe. Other Expenses Depreciation, depletion and amortization (“DD&A”) increased due to: • Higher depletion expense as a result of an increase in our DD&A rate, which was partially offset by a 3% decrease in production over the period. The increase in our DD&A rate was due to the decrease in our estimated proved reserves relative to our depreciable base, driven primarily by changes in commodity prices year-over-year as well as the sale of equity interest in DP Lion Equity Holdco LLC in December 2023. The proved reserves decrease was partially offset by the acquisition of the Oaktree, Crescent Pass, and East Texas II assets in 2024. Allowance for credit losses decreased due to: • The impact on anticipated credit losses on joint interest owner receivables has a direct relationship with pricing and distributions to individual owners. As the pricing environment declined in 2023, the underlying well economics did as well, and as a result, in 2023, we increased our reserve by $8 million . In 2024, with pricing more stable, no such adjustment to the reserve was deemed necessary. Refer to Notes 5, 10, 11 and 13 in the Notes to the Group Financial Statements for additional information regarding acquisitions, natural gas and oil properties, property, plant and equipment and derivative financial instruments, respectively. Derivative Financial Instruments We recorded the following gain (loss) on derivative financial instruments in the Consolidated Statement of Comprehensive Income for the periods presented: (In thousands) Year Ended December 31, 2024 December 31, 2023 $ Change % Change Net gain (loss) on commodity derivatives settlements (a) $151,289 $178,064 $(26,775) (15%) Net gain (loss) on interest rate swap(a) 190 (2,722) 2,912 (107%) Gain (loss) on foreign currency hedges(a) — (521) 521 (100%) Total gain (loss) on settled derivative instruments $151,479 $174,821 $(23,342) (13%) Gain (loss) on fair value adjustments of unsettled financial instruments(b) (189,030) 905,695 (1,094,725) (121%) Total gain (loss) on derivative financial instruments $(37,551) $1,080,516 $(1,118,067) (103%) (a) Represents the cash settlement of hedges that settled during the period. (b) Represents the change in fair value of financial instruments net of removing the carrying value of hedges that settled during the period. For the year ended December 31, 2024 , we recognized a loss on derivative financial instruments of $38 million compared to a gain of $1,081 million in 2023. Adjusting our unsettled derivative contracts to their fair values drove a loss of $189 million in 2024 , as compared to a gain of $906 million in 2023 , which is reflective of higher commodity prices on the forward curve. For the year ended December 31, 2024, we recognized a gain on settled derivative instruments of $151 million as compared to a gain of $175 million in 2023. The gain on settled derivative instruments relates to lower commodity market prices than those we secured through our derivative contracts. With consistent reliable cash flows central to our strategy, we routinely hedge at levels that, based on our operating and overhead costs, provide a significant adjusted EBITDA margin even if it means forgoing potential price upside. Refer to Note 13 in the Notes to the Group Financial Statements for additional information regarding derivative financial instruments. Finance Costs (In thousands) Year Ended December 31, 2024 December 31, 2023 $ Change % Change Interest expense, net of capitalized and income amounts (a) $120,773 $117,808 $2,965 3% Amortization of discount and deferred finance costs 16,870 16,358 512 3% Total finance costs $137,643 $134,166 $3,477 3% (a) Includes payments related to borrowings and leases. For the year ended December 31, 2024, interest expense of $121 million increased by $3 million compared to $118 million in 2023 , primarily related to interest on the new ABS IX Notes, Oaktree Seller’s Note, and Term Loan II. These increases were partially offset by lower outstanding balances on our existing ABS structures. 28 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report As of December 31, 2024 and 2023 , total borrowings were $1,736 million and $1,325 million, respectively. For the period ended December 31, 2024 , the weighted average interest rate on borrowings was 7.37% as compared to 6.03% as of December 31, 2023 . As of December 31, 2024, 83% of our borrowings reside in fixed-rate, hedge-protected, amortizing structures compared to 87% as of December 31, 2023. Refer to Notes 5, 20, and 21 in the Notes to the Group Financial Statements for additional information regarding acquisitions, leases and borrowings, respectively. Taxation The effective tax rate is calculated on the face of the Statement of Comprehensive Income by dividing the amount of recorded income tax benefit (expense) by the income (loss) before taxation as follows: (In thousands) Year Ended December 31, 2024 December 31, 2023 $ Change % Change Income (loss) before taxation $(223,952) $1,000,344 $(1,224,296) (122%) Income tax benefit (expenses) 136,951 (240,643) 377,594 (157%) Effective tax rate 61.2% 24.1% The differences between the statutory U.S. federal income tax rate and the effective tax rates are summarized as follows: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Expected tax at statutory U.S. federal income tax rate 21.0% 21.0% 21.0% State income taxes, net of federal tax benefit 3.7% 3.1% 1.2% Federal credits 41.3% —% —% Other, net (4.8%) —% 0.2% Effective tax rate 61.2% 24.1% 22.4% For the year ended December 31, 2024, we reported a tax benefit of $137 million , a change of $378 million, compared to expense of $241 million in 2023 which was a result of the change in the loss before taxation and a change in the amount of tax credits generated relative to the pre-tax loss. The resulting effective tax rates for the years ended December 31, 2024 and 2023 were 61.2% and 24.1%, respectively. The effective tax rate can be materially impacted by the recognition of the marginal well tax credit available to qualified producers as noted in our 2024 effective tax rate. A marginal well tax credit was not available for the 2023 tax year. The federal government provides these credits to encourage companies to continue operating lower-volume wells during periods of low prices to maintain production and the underlying jobs they create and the state and local tax revenues they generate for communities to support schools, social programs, law enforcement and other similar public services. Refer to Note 8 in the Notes to the Group Financial Statements for additional information regarding taxation. Operating Profit, Net Income, Adjusted EBITDA & EPS (In thousands, except per unit data) Year Ended December 31, 2024 December 31, 2023 $ Change % Change Operating profit (loss) $(43,026) $1,161,051 $(1,204,077) (104%) Net income (loss) attributable to Owners of Diversified Energy Company PLC (88,272) 758,018 (846,290) (112%) Adjusted EBITDA 472,309 546,788 (74,479) (14%) Earnings (loss) per share - basic $(1.84) $16.07 $(17.91) (111%) Earnings (loss) per share - diluted $(1.84) $15.95 $(17.79) (112%) For the year ended December 31, 2024 , we reported a net loss of $88 million and basic and diluted loss per share of $1.84 compared to net income of $758 million and basic EPS of $16.07 ($15.95 diluted EPS) in 2023, a decrease of 112% . We also reported an operating loss of $43 million compared with an operating profit of $1,161 million for the years ended December 31, 2024 and 2023, respectively. This year-over-year decrease in net income was primarily attributable to a $1,118 million decrease in gains on derivatives due to changes in commodity prices on the forward curve, a $24 million decrease in gains on sale of assets, a decrease in gross profit of $94 million, a $3 million increase in finance costs, partially offset by a $378 million swing in income tax expense to a benefit as compared to 2023 , as a result of marginal well credits. Excluding the mark-to-market loss on long-dated derivative valuations, as well as other customary adjustments, we reported adjusted EBITDA of $472 million for the year ended December 31, 2024 compared to $547 million for the year ended December 31, 2023 , representing a decrease of 14% driven by a decrease in commodity pricing and production from prior year, primarily as a result of our sale of equity interest in DP Lion Equity Holdco in December 2023, in addition to normal declines. These decreases were partially offset by adjusted EBITDA growth through the Oaktree, Crescent Pass, and East Texas II acquisitions in 2024. Liquidity & Capital Resources Overview 29 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Our principal sources of liquidity are cash generated from operations and available borrowings under our Credit Facility. To minimize interest expense, we use our excess cash flow to reduce borrowings on our Credit Facility. Consequently, we have historically maintained low cash balances on our Consolidated Statement of Financial Position, as evidenced by the $6 million and $4 million in cash and cash equivalents as of December 31, 2024 and 2023, respectively. When we acquire assets for growth, we complement our Credit Facility with long-term, fixed rate, fully-amortizing, asset-backed debt secured by certain natural gas and oil assets. This financing strategy aligns with the long-life nature of our assets, offering us lower borrowing rates and a clear path to reduce leverage through scheduled principal payments. For larger, value-adding acquisitions, and to maintain an appropriate leverage profile for the assets we acquire, we also periodically raise funds through secondary equity offerings. We closely monitor our working capital to ensure it remains sufficient for business operations, using any excess liquidity primarily to repay debt. Alongside managing working capital, we take a disciplined approach to controlling operating costs and allocating capital resources. This approach ensures that capital investments generate returns that support our strategic initiatives. Capital expenditures were $52 million for the year ended December 31, 2024, compared to $74 million for the year ended December 31, 2023. This decrease was primarily driven by the completion of wells in 2023 that were under development at the time of the March 2023 Tanos II acquisition. Although we completed additional wells in 2024, the capital expenditures required for their development were less significant than those in 2023. Additionally, we made improvements at our Black Bear facility in the Central Region in 2024, which contributed to the overall capital expenditure. We expect to meet our capital expenditure needs for the foreseeable future from our operating cash flows and our existing cash and cash equivalents. Our future capital requirements will depend on several factors, including our growth rate, commodity prices and future acquisitions. With respect to our other known current obligations, we believe that our sources of liquidity and capital resources will be sufficient to meet our existing business needs for at least the next 12 months. However, our ability to satisfy our working capital requirements, debt service obligations and planned capital expenditures will depend upon our future operating performance, which will be affected by prevailing economic conditions in the natural gas and oil industry and other financial and business factors, some of which are beyond our control. Refer to Note 21 in the Notes to the Group Financial Statements for additional information regarding our current debt obligations. Liquidity The table below represents our liquidity position as of December 31, 2024 and 2023. As of (In thousands) December 31, 2024 December 31, 2023 Cash and cash equivalents $5,990 $3,753 Available borrowings under the Credit Facility(a) 86,690 134,817 Liquidity $92,680 $138,570 (a) Represents available borrowings under the Credit Facility of $101 million as of December 31, 2024 less outstanding letters of credit of $14 million as of such date. Represents available borrowings under the Credit Facility of $146 million as of December 31, 2023 less outstanding letters of credit of $11 million as of such date. Debt Our net borrowings consisted of the following as of the reporting date: As of (In thousands) December 31, 2024 December 31, 2023 Total debt $1,693,242 $1,276,627 LESS: Cash 5,990 3,753 LESS: Restricted cash(a) 46,269 36,252 Net debt $1,640,983 $1,236,622 (a) The increase of restricted cash as of December 31, 2024, is due to the addition of $21 million and $3 million in restricted cash for the ABS VIII Notes and ABS IX Notes, respectively, offset by $7 million and $9 million for the retirement of the ABS III Notes and ABS V Notes, respectively. Asset Retirement Obligations We remain proactive and innovative in our approach to asset retirement. Following our LSE IPO in 2017, we initiated meetings with state officials to develop a long-term plan for retiring our expanding portfolio of long-life wells. By collaborating with state regulators, we have designed our retirement activities to be equitable for all stakeholders, with a strong emphasis on environmental responsibility. Asset retirements for the year ended December 31, 2024 were as follows: DEC-owned Appalachian well retirements 202 3rd party-owned Appalachian well retirements(a) 85 Total Appalachian wells retired by Next LVL 287 DEC-owned Central Region well retirements 13 Total wells retired 300 (a) Includes 51 state and federal orphan wells and 34 wells for other operators. 30 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report We expanded asset retirement operations from 17 rigs at December 31, 2023 to 18 rigs by December 31, 2024. Our continued growth in capacity enhances our ability to integrate asset retirement operations and achieve cost efficiencies across a broader footprint. Additionally, it enables us to generate third-party revenues by offering a suite of services to other production companies and state orphan well programs, which can help fund our own asset retirement program. Consequently, we aim to achieve a prudent mix of cost reduction and third-party revenues to maximize the benefits of our internal asset retirement program. Our asset retirement program demonstrates our strong commitment to a healthy environment and the surrounding communities. We anticipate continued investment and innovation in this area. In 2025, we will focus on realizing the benefits of vertical integration by expanding our internal asset retirement capacity. This will help us reduce reliance on third-party contractors, mitigate outsource risks, improve process quality and responsiveness, and enhance control over environmental remediation and costs. The composition of the provision for asset retirement obligations at the reporting date was as follows for the periods presented: Year Ended (In thousands) December 31, 2024 December 31, 2023 Balance at beginning of period $506,648 $457,083 Additions(a) 111,265 3,250 Accretion 30,868 26,926 Asset retirement costs (6,724) (5,961) Disposals(b) — (17,300) Revisions to estimate(c) 6,521 42,650 Balance at end of period $648,578 $506,648 Less: Current asset retirement obligations 6,436 5,402 Non-current asset retirement obligations $642,142 $501,246 (a) Refer to Note 5 in the Notes to the Group Financial Statements for additional information regarding acquisitions and divestitures. (b) Associated with the divestiture of natural gas and oil properties. Refer to Note 5 in the Notes to the Group Financial Statements for additional information. (c) As of December 31, 2024 , we performed normal revisions to our asset retirement obligations, which resulted in a $7 million million increase in the liability. This increase was comprised of increases of $95 million for cost revisions, which was partially offset by an $89 million decrease attributable to a higher discount rate as a result of an increase in bond yield volatility during the year. As of December 31, 2023, we performed normal revisions to our asset retirement obligations, which resulted in a $43 million increase in the liability. This increase was comprised of a $28 million increase attributable to a lower discount rate as a result of slightly decreased bond yields as compared to 2022 as inflation began to increase at a lower rate and $16 million in cost revisions. Partially offsetting these decreases was a $1 million change attributed to timing. The anticipated future cash outflows for our asset retirement obligations on an undiscounted and discounted basis are set forth in the tables below as of December 31, 2024 and 2023. When discounting the obligation, we apply annual inflationary cost increases to our current cost expectations and then discount the resulting cash flows using a credit adjusted risk free discount rate resulting in a net discount rate of 3.7% and 3.4% for the periods indicated, respectively. While the rate is comparatively small to the commonly utilized PV-10 metric in our industry, the impact is significant due to the long-life low-decline nature of our portfolio. Although productive life varies within our well portfolio, presently we expect all of our existing wells to have reached the end of their productive lives and be retired by approximately 2098. When evaluating our ability to meet our asset retirement obligations we review reserves models which utilize the income approach to determine the expected discounted future net cash flows from estimated reserve quantities. These models determine future revenues associated with production using forward pricing then consider the costs to produce and develop reserves, as well as the cost of asset retirement at the end of a well’s life. These future net cash flows are discounted using a weighted average cost of capital of 10% to produce the PV-10 of our reserves. After considering the asset retirement costs in these models, our PV-10 was approximately $3.3 billion , $3.2 billion and $6.1 billion as of December 31, 2024, 2023 and 2022, respectively, illustrating residual cash flows well beyond our retirement obligations. As of December 31, 2024: (In thousands) Not Later Than One Year Later Than One Year and Not Later Than Five Years Later Than Five Years Total Undiscounted $6,436 $27,913 $2,432,934 $2,467,283 Discounted 6,436 24,450 617,692 648,578 As of December 31, 2023 : (In thousands) Not Later Than One Year Later Than One Year and Not Later Than Five Years Later Than Five Years Total Undiscounted $5,402 $20,365 $1,778,876 $1,804,643 Discounted 5,402 17,975 483,271 506,648 31 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Cash Flows Our principal sources of liquidity have historically been cash generated from operating activities. To minimize financing costs, we apply our excess cash flow to reduce borrowings on our Credit Facility. We monitor our working capital to ensure that the levels remain adequate to operate the business with excess cash primarily being utilized for the repayment of debt or shareholder distributions. In addition to working capital management, we have a disciplined approach to managing operating costs and allocating capital resources, ensuring that we are generating returns on our capital investments to support the strategic initiatives in our business operations. (In thousands) Year Ended December 31, 2024 December 31, 2023 $ Change % Change Net cash provided by operating activities $345,663 $410,132 $(64,469) (16%) Net cash used in investing activities (272,916) (239,369) (33,547) 14% Net cash used in financing activities (70,510) (174,339) 103,829 (60%) Net change in cash and cash equivalents $2,237 $(3,576) $5,813 (163%) Net Cash Provided by Operating Activities For the year ended December 31, 2024, net cash provided by operating activities of $346 million decreased by $64 million, or 16%, when compared to $410 million in 2023. The change in net cash provided by operating activities was predominantly attributable to the following: • A decrease in net income of $847 million, driven by a decrease in the fair value adjustments of unsettled derivative financial instruments of $1,095 million , and a decrease of $378 million in income tax expense as a result of marginal well credits; and • Changes in working capital generated reduced cash outflows of $50 million compared to 2023. Production, realized prices, operating expenses, and G&A are discussed above. Net Cash Used in Investing Activities For the year ended December 31, 2024, net cash used in investing activities of $273 million increased by $34 million, or 14% , from outflows of $239 million in 2023. The change in net cash used in investing activities was primarily attributable to the following: • A net increase in cash outflows of $58 million for acquisition, divestiture and disposal activity. Net cash outflows associated with acquisitions, divestitures and disposals was $220 million during the year ended December 31, 2024 when compared to $162 million for the year ended December 31, 2023. Refer to Note 5 and Note 11 in the Notes to the Group Financial Statements for additional information regarding acquisitions, divestitures and disposals; and • A decrease in cash outflows of $22 million for capital expenditures. Capital expenditures were $52 million for the year ended December 31, 2024 compared to $74 million for the year ended December 31, 2023. This decrease was primarily driven by the completion of wells in 2023 that were under development at the time of the March 2023 Tanos II acquisition. Although we completed additional wells in 2024, the capital expenditures required for their development were less significant than those in 2023. Additionally, we made improvements at our Black Bear facility in the Central Region in 2024, which contributed to the overall capital expenditure. Net Cash Used in Financing Activities For the year ended December 31, 2024, net cash used in financing activities of $71 million decreased by $103 million, or 59%, as compared to $174 million in 2023. This change in net cash used in financing activities was primarily attributable to the following: • An increase in cash inflows of $202 million related to debt activity. Debt activity resulted in proceeds, or a net cash inflow of $191 million (including $805 million in repayments of amortizing debt, inclusive of the retirement of ABS III and V Notes and the ABS Warehouse Facility) in 2024 versus payments, or a net cash outflow, of $11 million in 2023, with much of the change attributable to the issuance of the ABS VIII and IX Notes and the Term Loan II during 2024, which was partially offset by the retirement of the ABS III and V Notes; • A decrease of $84 million due to a reduction in dividends paid in 2024 as compared to 2023; • A decrease of $6 million due to reduced hedge modifications associated with ABS notes in 2024 as compared to 2023; • An increase of $9 million due to proceeds received as a result of a lease modification for our fleet that was executed in 2024; • A decrease of $157 million in proceeds from the equity issuance in 2023 that did not occur in 2024; • An increase of $29 million due to increased finance costs and restricted cash requirements, primarily attributable to the ABS VIII and IX Notes, and the Oaktree Seller’s Note issued in 2024, partially offset by the retirement of the ABS III and V Notes; and • An increase of $10 million due to an increase in share repurchases in 2024. Refer to Notes 16, 18 and 21 in the Notes to the Group Financial Statements for additional information regarding share capital, dividends and borrowings, respectively. 32 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Contractual Obligations & Contingent Liabilities & Commitments We have various contractual obligations in the normal course of our operations and financing activities. Significant contractual obligations as of December 31, 2024 were as follows: (In thousands) Not Later Than One Year Later Than One Year and Not Later Than Five Years Later Than Five Years Total Recorded contractual obligations Trade and other payables $35,013 $— $— $35,013 Borrowings 209,463 940,780 585,330 1,735,573 Leases 13,776 30,733 91 44,600 Asset retirement obligation(a) 6,436 27,913 2,432,934 2,467,283 Other liabilities(b) 161,467 5,384 — 166,851 Off-Balance Sheet contractual obligations Firm Transportation(c) 51,795 106,324 — 158,119 Total $477,950 $1,111,134 $3,018,355 $4,607,439 (a) Represents our asset retirement obligation on an undiscounted basis. On a discounted basis the liability is $649 million as of December 31, 2024 as presented in the Consolidated Statement of Financial Position. (b) Represents accrued expenses and net revenue clearing. Excludes asset retirement obligations and revenue to be distributed. Refer to Note 23 in the Notes to the Group Financial Statements for information. (c) Represents reserved capacity to transport gas from production locations through pipelines to the ultimate sales meters. We believe that our operational cash flows and existing liquidity will be sufficient to meet our contractual obligations and commitments over the next twelve months, even in a stressed scenario, as demonstrated by our Viability and Going Concern assessment. Cash flows from operations were $346 million for the year ended December 31, 2024 , which includes partial-year contributions from the Oaktree, Crescent Pass and East Texas II acquisitions in 2024. Cash flows from operations were $410 million for th e year ended December 31, 2023, which similarly included partial-year contributions from the Tanos II acquisition in 2023. As of December 31, 2024 and 2023, we had current assets of $304 million and $305 million , respectively, and available borrowings on our Credit Facility of $101 million and $146 million , respectively, (excluding $14 million and $11 million in outstanding letters of credit, respectively), which could also be used to service our contractual obligations and commitments over the next twelve months. Risk Management Framework Our Enterprise Risk Management (“ERM”) program underscores the significance of risk awareness and mitigation throughout the organization. We proactively identify, assess, prioritize, monitor, and mitigate risks, enabling us to achieve the strategic objectives outlined in our business model. The Board conducts thorough assessments of our principal and emerging risks regularly. Principal risks are actively managed due to their potential to jeopardize our business model, future performance, or financial stability. Emerging risks are new, uncertain, or evolving threats that require ongoing monitoring, as they may escalate to principal risks over time. Our ERM program relies on systematic processes to continuously evaluate and enhance based on experience and industry best practices. As directed by the Audit & Risk Committee, our Senior Leadership Team regularly engages in risk discussions across all operational areas. This proactive dialogue fosters a culture that highly values risk mitigation, thereby preserving and creating value for our stakeholders. We consider risk management a collective responsibility and empower all employees to enhance our processes and procedures to mitigate risks effectively. Our ERM program offers reasonable assurance, not absolute certainty, that our risks are being effectively managed. Risk Identification In the risk identification phase of our ERM program, we capture potential and emerging risks arising from changes in circumstances or new developments. To strengthen our risk identification, we undertake the following activities: • Continuous monitoring of the risk universe for new or emerging risks; • Re-evaluating the risk universe at least annually; • Enhancing our risk awareness culture and identifying risk ownership; • Interviewing risk owners about current mitigation activities; and • Designing and implementing a risk mitigation control framework. Risk Assessment We assess business risks using a scorecard approach that evaluates (i) likelihood, (ii) potential impact, and (iii) speed of impact. Our assessment includes both financial and non-financial exposures. For each identified principal risk, we develop a list of mitigating activities and potential opportunities to offset or minimize the risk. Risk Response Risk management begins with the Board, responsible for ensuring that risks are addressed and mitigated through our corporate strategy, business model, and within the Board’s risk appetite. The Board actively monitors company performance on mitigation activities by engaging with executive and senior management. 33 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report Principal Risks and Uncertainties By leveraging our comprehensive risk management framework, we ensure a proactive approach to mitigating potential threats, which is crucial for maintaining our stability and achieving our strategic goals. Below, we outline our principal risks and corresponding risk responses. Strategic Risks 1 Corporate Strategy & Acquisition Risk Our future growth depends heavily on successfully completing acquisitions that align with our strategic goals. The process of executing and seamlessly integrating acquisitions could place significant demands on our managerial, operational, and financial resources. If we fail to properly assess, execute, and integrate acquisitions, it could negatively affect our business operations, financial performance, and overall prospects. Link to Strategy: .1 . .2 . . 3. .4 . Link to KPIs: .1. . 2. .3 . . 4. Response/Mitigation • Maintaining a disciplined commitment to our core strategy is essential. By focusing on acquiring low-cost, long-life, and relatively low-decline producing assets, along with complementary and synergistic midstream assets, we can ensure sustainable growth and stability. This approach helps us maximize value and efficiency while minimizing risks. • Our Commercial Development, Land, Reserves, Strategic Planning, and Financial Planning & Analysis teams collaborate closely to identify and evaluate potential acquisition opportunities that align with our strategic objectives. This teamwork ensures that all potential acquisitions are thoroughly vetted to meet our criteria. • Our organization leverages its extensive experience and knowledge to identify and recognize potential opportunities. • We conduct thorough risk assessments and a comprehensive due diligence process for all potential new acquisitions. This process ensures we understand the full scope of risks and opportunities associated with each acquisitions, aligning with our commitment to sustainability and strategic growth. • We incorporate feedback and evaluations from external experts during the due diligence process. This feedback ensures that we benefit from specialized knowledge and objective insights, enhancing the thoroughness and accuracy of our assessments. • We strive to maintain a strong balance sheet with significant liquidity, enabling us to fund growth through acquisitions effectively. This financial strength ensures we can seize opportunities as they arise, supporting our strategic objectives and long-term success. 2 Climate Risk Climate-related matters remain central to numerous global corporate discussions and decisions. While opportunities related to climate continue to arise in this swiftly changing landscape, we acknowledge that these issues may pose risks for DEC. Environmental regulations, climate change concerns, and investor-driven changes may lead to (i) increased business costs, (ii) challenges in executing our strategy, and (iii) restricted access to specific markets or investors. Link to Strategy: .1 . .2 . . 3. .4 . Link to KPIs: .2. . 5. .6 . Response/Mitigation • Our Board oversees the development of our climate risk strategy which aims to position us at the heart of the energy transition based on responsible stewardship of existing natural gas and oil assets. The Board’s decision-making is informed by regular climate subject matter updates from each of our key Board committees. • Through our annual TCFD reporting process, we identify and assess climate-related risks for consideration of appropriate risk mitigation actions. • Our core business strategy aligns with numerous sustainability initiatives. We acquire reliable, long-life, producing wells that often have not reached their full potential under their former owners. This stewardship model allows us to avoid the high cost and sometimes sizeable environmental impact often associated with exploration and drilling, which is the intended target of many sustainability initiatives. • Alongside our zero-tolerance operating principle for fugitive emissions, we invest capital funds towards emission reduction technologies and projects and regularly deploy SAM optimization techniques that allow us to eliminate or reduce our carbon footprint. • Our core KPI of methane intensity reduction is central to our corporate goals to reduce both methane and GHG emissions. • We again expanded our asset retirement capabilities, managed through our Next LVL subsidiary, that will permit us to exceed our long-term Appalachian asset retirement agreements, reflective of our core KPI to meet or exceed state asset retirement goals. Financial Risks 3 Commodity Price Volatility Risk Changes in commodity prices may affect the value of our natural gas and oil reserves, operating cash flows and adjusted EBITDA, regardless of our operating performance. Link to Strategy: .3 . Link to KPIs: .1. . 2. .4 . Response/Mitigation • Our Senior Leadership Team monitors commodity markets on a daily basis and internal models are routinely updated to evaluate market changes. This monitoring process includes reviewing realized pricing, forward pricing curves, and basis differentials. This active monitoring is critical to risk mitigation and the successful execution of our hedge strategy. • Our hedging policy continues to be guided by our goal to generate reliable free cash flow in any commodity pricing environment and secure our debt and dividend payments. Our hedge strategy of proactively layering on appropriately structured hedge contracts at advantageous prices and tenors allows us to capitalize on beneficial price movements in a constantly changing, forward natural gas price market. • External specialists are consulted on a regular basis to assist in the execution of our hedging strategy. 34 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report 4 Financial Strength & Flexibility Risk Liquidity and access to capital risks arise from our inability to generate cash flows from operations to fund our business requirements or our inability to access external sources of funding. These risks can result in difficulty in meeting our financial obligations as they become due. Link to Strategy: .1 . .2 . . 3. .4 . Link to KPIs: .1. . 2. .3 . . 6. Response/Mitigation • Our Senior Leadership Team actively monitors debt levels and available borrowing capacity on our Credit Facility. • Our Senior Leadership Team updates the Board at least quarterly on our debt and liquidity position. • Our business model of stable production contributes to predictable cash flows, which facilitates an efficient forecasting ability. • Strong access to bank capital as our borrowing base in the Fall 2024 redetermination was reaffirmed unanimously by our 12 -bank group syndicate. • Maintain access to multiple avenues of funding beyond our Credit Facility: equity issuance, asset-backed securitizations, and bond issuance. • Proactive hedge program to protect against commodity price volatility and stabilize operating cash flows. • Continuous management review of funding and financing alternatives. Legal, Regulatory and Reputational Risks 5 Regulatory & Political Risk Our operations are governed by regulations in every jurisdictions where we operate. We cannot predict the impact of potential future laws or regulations, including whether they could negatively affect our operations. We cannot guarantee that any new legislation, if enacted, will not require us to incur substantial costs, make significant investments, or reduce production. Link to Strategy: .2 . .4 . Link to KPIs: .1. . 2. .3 . . 4. . 5 . . 6 . . 7 . Response/Mitigation • Operate to the highest industry standards with regulators and monitor compliance with our contracts, asset retirement program and taxation requirements. • External specialists utilized on legal, regulatory, and tax issues as required. • Foster strong relationships with local, state, and federal authorities, as well as other government bodies and key stakeholders. • Continuous monitoring of the political and regulatory environments in which we operate. • Working responsibly and community/stakeholder engagement and outreach is an important factor in maintaining positive relationships in the communities in which we operate. • We encourage our employees to become actively involved in their communities through industry associations in their respective operating areas. By leading, participating in and championing a variety of these organizations, we believe that our support of the energy industry’s associations adds value to our business through the sharing of operating best practices, technical knowledge and legislation updates, ultimately to the benefit of all our stakeholders. 6 Health & Safety Risk Potential impacts from a lack of adherence to health and safety policies may result in fines and penalties, serious injury or death, environmental impacts, statutory liability for environmental redemption and other financial and reputational consequences that could be significant. Link to Strategy: .2 . .4 . Link to KPIs: .1. . 2. .3 . . 4. . 7 . Response/Mitigation • Effectively managing Health and Safety Risk exposure is the first priority for the Board and Senior Leadership Team. The Sustainability & Safety Committee of the Board regularly reviews health and safety programs and mitigations. • Health and safety training is included as part of all staff and contractor inductions. • Detailed training on our field manual procedures has been provided to key stakeholders to ensure processes and procedures are embedded throughout the organization and all operations. • Establishing processes for continually assessing our overall operating and EHS capabilities, including evaluations to determine the level of oversight required. • Effective execution of the field operating manual in operations. • Crisis and emergency response procedures and equipment are maintained and regularly tested to ensure we are able to respond to an emergency quickly, safely and effectively. • Leading and lagging indicators and targets developed in line with industry guidelines and benchmarks. • Findings from ‘lessons learned’ reviews are implemented on future operations. • All employees maintain work stoppage ability. Operational Risk 7 Cybersecurity Risk Cybersecurity risks for companies have increased significantly in recent years due to the mounting threat and sophistication of cybercrime. A cybersecurity breach, incident, or failure of our IT systems could disrupt our businesses, put employees at risk, result in the disclosure of confidential information, damage our reputation, and create significant financial and legal exposure for DEC. Our network is designed using a Zero Trust Approach (“ZTA”) and is segmented to provide additional layers of security. We have established several layers of security, including least privilege access, conditional access policies, and multi-factor authentication (“MFA”). Our ZTA extends beyond our 35 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report network to encompass identity, endpoints, infrastructure, data, and applications. This integrated ecosystem enables enhanced visibility, intelligence, and automation for our security team. Due to our 100% cloud environment, we focus on continuous testing of our security posture from both trusted and untrusted sources—both external and internal to our networks—rather than relying on a one-time penetration testing approach. Additionally, we collaborate with third-party managed security service providers and utilize internal resources for round-the-clock incident monitoring. Link to Strategy: .2 . .3 . Link to KPIs: .1. . 2. .4 . Response/Mitigation • Employees are our first line of defense against cyberattacks, and we promote secure behaviors to help mitigate this growing risk. We focus on practical rules through robust mandatory annual training and e-learning sessions delivered by our digital security team. One of these rules addresses phishing and reminds staff to ‘think before they click’. • We engage with key technology partners and suppliers to ensure potentially vulnerable systems are identified and secured. • We test our cybersecurity crisis management and business continuity plans, recognizing the evolving nature and pace of the threat landscape. • We continuously implement and monitor our IT Security Policy, which includes measures to protect against cyberattacks. • Advanced network security detection with regular threat testing. • Control and protection of confidential information. • Our Information Security Management Team, which includes certain members of the Senior Leadership Team including the Chief Financial Officer, Chief Information Officer, Chief Information Security Officer and General Counsel, meets at least once a quarter to discuss cybersecurity issues, risks and strategies. The Information Security Management Team regularly briefs the Board of Directors on information security matters, including assessing risks, efforts to improve our network security systems and enhanced employee trainings. The membership of this committee is adequately trained and educated to provide proper governance, risk management, and control of the cybersecurity program utilizing the National Institute of Standards and Technology framework. There were no cybersecurity incidents during the year ended December 31, 2024, that resulted in an interruption to our operations, known losses of any critical data, or otherwise had a material impact on our strategy, financial condition, or results of operations. However, the scope and impact of any future incident cannot be predicted. Viability and Going Concern In accordance with Provision 31 section 4 of the UK Corporate Governance Code, and taking into account our current financial position and principal risks for a period longer than the 12 months required by the going concern statement, the Senior Leadership Team prepared a viability analysis which was assessed by the Board for approval. Assessment Process and Key Assumptions Our financial outlook is assessed primarily through a detailed annual business planning process and a more general multi-year forecast. The Senior Leadership Team provides the Board with a detailed overview as part of its annual budget approval while providing regular updates at each Board meeting throughout the year. The Board uses this information, along with any other detail it requests, to assess our current performance and longer- term outlook. The outputs from the business planning process include a set of key performance objectives, an assessment of our primary risks, the anticipated operational outlook and a set of financial forecasts that consider the sources of funding available to DEC (the “Base Plan”). Key assumptions, which underpin the annual business planning process, include the forward price strip for each commodity (natural gas, NGLs and oil), forecasted operating cost and capital expenditure levels, production profiles, and the availability of liquidity or additional financing. We regularly produce cash flow projections, which we sensitize for different scenarios including, but not limited to, changes in commodity prices and production rates from our wells. The Directors and Senior Leadership Team closely monitor these forecast assumptions and projections and seek to mitigate our operating and liquidity risks. Based on our financial scenario planning process, the Directors and Senior Leadership Team believe that stress testing forecast results over the Base Plan for a two-year period through March 2027 forms a reasonable expectation of our viability. At least annually, we perform our two-year Base Plan forecast for our medium-term strategic planning period. The Directors and Senior Leadership Team are confident that they appropriately monitor and manage operational risks effectively within the two-year Base Plan, and our scenario planning is focused primarily on plausible changes in external factors, providing a reasonable degree of confidence. Viability The principal risks and uncertainties that affect the Directors’ assessment of our viability in this period are: • The effect of volatile natural gas prices on the business; • Operational production performance of the producing assets; and • Operating cost levels and our ability to control costs. The Base Plan incorporates key assumptions that reflect these principal risks as follows: • Projected operating cash flows are calculated using a production profile which is consistent with current operating results and decline rates; • Assumes commodity prices are in line with the current forward curve which considers basis differentials; • Operating cost levels stay consistent with historical trends which have been recently elevated due to the inflationary environment; • The financial impact of our current hedging contracts in place, being approximately 86% and 82%, of total production volumes hedged for the years ending December 31, 2025 and 2026, respectively; and • The scenario also includes the scheduled principal and interest payments on our current debt arrangements. 36 Table of Contents Diversified Energy Company PLC 2024 Annual Report Strategic Report To assess our viability, the Directors and Senior Leadership Team considered various scenarios around the Base Plan that primarily reflect a more severe, but plausible, downside impact of the principal risks, both individually and in the aggregate, as well as the additional capital requirements that downside scenarios could place on us. Conservatively, our viability statement considered the combined impact of all three listed scenarios in: Scenario 1: Cyclically low gas prices for a year (Henry Hub prices of $2.00 per MMbtu before returning to strip pricing), which have been historically observed in the market. Scenario 2: Considered the impact of climate change by assuming a two-week period of lost production in our East Texas/Louisiana region, which is susceptible to hurricanes, due to a natural disaster (assumed to occur once in each year of the assessment period). Scenario 3: Considered the impact of climate change by assuming a two -week period of lost production in our Appalachia region (assumption of lost production in 25% of the total region), which is susceptible to flooding, due to a natural disaster (assumed to occur once in each year of the assessment period). The Directors and Senior Leadership Team considered the impact that these principal risks could, in certain circumstances, have on our prospects within the assessment period, and accordingly appraised the opportunities to actively mitigate the risk of these severe, but plausible, downside scenarios. Based on their evaluation, the Directors and Senior Leadership Team have a reasonable expectation that we will be able to continue in operation and meet our liabilities as they fall due during the assessment period. Going Concern In assessing our going concern status, we have taken account of our financial position, anticipated future trading performance, borrowings and other available credit facilities, forecasted compliance with covenants on those borrowings, and capital expenditure commitments and plans. Our cash generation and liquidity remain adequate and we believe we will be able to operate within existing facilities. The Directors are satisfied that our forecasts and projections, that take into account reasonably possible changes in trading performance, show that we have adequate resources to continue in operational existence for at least 12 months from the date of this Annual Report and that it is appropriate to adopt the going concern basis in preparing our consolidated financial statements for the year ended December 31, 2024. The Strategic Report was approved by the Board of Directors and signed on its behalf by: David E. Johnson Chairman of the Board March 17, 2025 37 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Corporate Governance Page The Chairman’s Governance Statement 37 Governance Framework 37 Our Approach to Governance 40 Board of Directors 42 Senior Management 44 Directors’ Report 45 The Nomination & Governance Committee’s Report 50 The Audit & Risk Committee’s Report 52 The Remuneration Committee’s Report 57 The Sustainability & Safety Committee’s Report 78 The Chairman’s Governance Statement Dear Shareholder, As a Board, we have been driving our governance standards towards meeting best practice, and it has been my privilege to work with this Board which is committed to maintaining high standards of corporate governance. As Chairman of the Group, my role is to provide leadership, ensuring that the Board performs its role effectively and has the capacity, ability, structure, corporate governance systems and support to enable it to continue to do so. This Governance section of this Annual Report provides an update on our Board and Corporate Governance Policy. It includes our UK Corporate Governance Code compliance statements and the reports of the Board committees, namely the Audit & Risk, Nomination & Governance, Remuneration, and Sustainability & Safety Committees. In these reports, we set out our governance structures and explain how we have applied the UK Corporate Governance Code and applicable NYSE and SEC rules. David E. Johnson Chairman of the Board March 17, 2025 Governance Framework The Group’s success is directly linked to sound and effective governance and we remain committed to achieving high standards in all we do. The Directors recognize the importance of strong corporate governance and have developed a corporate governance framework and policies appropriate to the size of the Group. As the Group grows, the Directors and Senior Leadership Team continue to review and adjust our approach, make ongoing improvements to the Group’s corporate governance framework and policies and procedures as part of building a successful and sustainable company. Good governance creates the opportunity for appropriate decisions to be made by the right people at the right time to support the delivery of our strategy and manage any risks associated with delivery of that strategy. Board Agenda and Activities During the Year The Board is responsible for the direction and overall performance of the Group with an emphasis on policy and strategy, financial results and major operational issues. During the year, the matters reserved for the Board’s decision have been reviewed and re-affirmed. Specific matters for the Board’s consideration include: • Approval of the Group’s strategic plan; • Review of the performance of the Group’s strategy, objectives, business plans and budgets; • Review and assess the Group’s sustainability goals, including the Group’s GHG emission intensity reduction targets; • Review and assess the Group’s health and safety metrics and goals; • Approval of the Group’s operating and capital expenditure budgets and any material changes to them; • Review of material changes to the Group’s corporate structure and management and control structure; • Review of changes to governance and business policies; • Monitoring efforts related to community and stakeholder engagement; • Ensuring an effective system of internal control and risk management; • Ensure that appropriate succession planning procedures are in-place; • Approval of annual and interim reports and accounts, and preliminary announcements of year-end results; and • Review of the effectiveness of the Board and its committees. 38 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance The Board delegates matters not reserved for the Board to the Senior Leadership Team. Board of Directors Defines business strategy, assesses risks and monitors performance Remuneration Committee Sustainability & Safety Committee Nomination & Governance Committee Audit & Risk Committee Responsible for the Group’s remuneration policy, and for setting pay levels and bonuses for senior management in line with individual performance. Ensures safety and sustainability KPIs are included in remuneration packages. Monitors the Group’s social, ethical, environmental and safety performance, and oversees all sustainable development issues on behalf of the Board. Ensures a balance of skills, knowledge, independence and experience on the Board and its committees. Monitors the Group’s governance structure. Supports the Board in monitoring the integrity of the Group’s financial statements and reviews the effectiveness of the Group’s system of internal controls and risk management systems. CEO Takes ultimate responsibility for delivering on strategy, financial and operating performance. President & Chief Financial Officer Executive Vice President of Operations Chief Legal & Risk Officer Executive Vice President & Investment Officer Executive Vice President of Energy Marketing Chief Human Resources Officer Description of Role Manages the finance and accounting activities of the Group and ensures that its financial reports are accurate and completed in a timely manner. Oversees the Group’s information technology function to ensure safety and soundness of internal controls and systems. Coordinates operating activities and sustainability initiatives to ensure transparency and long-term value for DEC’s stakeholders. Responsible for legal and compliance, government, policy engagement, community engagement and land and mineral owner engagement. Responsible for identifying and valuing acquisition targets. Responsible for developing and implementing a commodity marketing strategy to maximize commodity revenues. Responsible for HR function and employee relations, policies, practices and operations. Responsibility Treasury, Accounting & Financial Reporting, Investor Relations, Information Technology & Sustainability Reporting Operations, EHS & Regulatory Legal & Compliance, Land, Policy Engagement & Community Relations Acquisitions Marketing Human Resource Risk Management Guidelines Employee Handbook, Code of Business Conduct & Ethics, Tax Policy & Anti-Bribery & Corruption Policy Employee Handbook, Code of Business Conduct & Ethics, EHS Policy, Climate Policy, Socio-Economic Policy & Field Operating Guidelines Employee Handbook, Code of Business Conduct & Ethics, Anti-Bribery & Corruption Policy, Whistleblowing Policy & Securities Dealing Policy Employee Handbook, Code of Business Conduct & Ethics & Anti- Bribery & Corruption Policies Employee Handbook, Code of Business Conduct & Ethics & Anti- Bribery & Corruption Policies Employee Handbook and Code of Business Conduct & Ethics, Employee Relations, Human Rights, Anti- Bribery & Corruption Policies & Whistleblowing Policy Stakeholder Engagement Responsibility Employees, Rating Agencies, Financial Institutions & Debt & Equity Investors Communities, Employees & Business Partners Employees, Industry Associations, Communities, Land & Mineral Owners & Government & Regulators Customers Customers Employees & Communities Board Effectiveness, Composition and Independence As of December 31, 2024, the Board was comprised of seven Directors being the Group’s CEO, the Non-Executive Chairman (who was independent upon appointment) and five other Non-Executive Directors, all of whom were deemed Independent Non-Executive Directors under the UK Corporate 39 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Governance Code, except one. As Mr. Thomas has served on the Board for ten years as of January 1, 2025, the Board no longer considers him independent. In January 2025, Ms. Kerrigan retired from the Board due to other commitments. As a foreign private issuer, under the listing requirements and rules of the NYSE, we are not required to have independent directors on our Board, except that our audit committee is required to consist fully of independent directors, subject to certain phase-in schedules. Our Board has determined that five of our six Directors do not have a relationship that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is “independent” as that term is defined under the rules of the NYSE. The skills and experience of the Non-Executive Directors are wide and varied and contribute to productive and challenging discussions in the boardroom ensuring the Board has appropriate independent oversight. For more details on the skills, knowledge and experience of our Board refer to the Directors’ biographies in Board of Directors within this Annual Report. With a Non-Executive Chairman, and, as of January 1, 2025, four other Independent Non-Executive Directors, over half of the Board is independent and the Audit & Risk and Remuneration Committees were completely independent. Female representation at the Board level increased from 29% in late-2019 to 43% as of December 31, 2024 (three out of seven Board members being female). Recognizing the importance of workforce engagement, Sandra M. Stash serves as the Director responsible for workforce engagement as required under the UK Corporate Governance Code. The Non-Executive Director Employee Representative directly engages with employees and provides a forum for feedback to management. These discussions cover a variety of topics including the Group’s culture, policies and actions. Ms. Stash has served as the Non-Executive Director Employee Representative since 2019. Further information on her role and the work undertaken can be found in the Directors’ Report within this Annual Report. The Board provides effective leadership and overall management of the Group’s affairs. It approves the Group’s strategy and investment plans and regularly reviews operational and financial performance and risk management matters. A schedule of matters reserved for the Board is included in the previous section. The Board and its committees hold regularly scheduled meetings each year. Additional meetings are held when necessary to consider matters of importance that cannot be held over until the next scheduled meeting. All Directors have access to the advice and services of the Group’s solicitors and the Group’s Corporate Secretary, who is responsible for ensuring that all Board procedures are followed. Any Director may take independent professional advice at the Group’s expense in the furtherance of their duties. In accordance with the UK Corporate Governance Code, the Directors must stand for re-election annually. The Group’s Articles of Association also require any new Director appointed by the Board during the year to retire at the next Annual General Meeting (“AGM”) and offer themselves for re- election. The Board delegates certain responsibilities to the Board committees, listed below, which have clearly defined terms of reference. These terms of reference are reviewed annually to ensure they remain fit for purpose and can be viewed on the Group’s website. Board Committees The Directors have established four Board committees: an Audit & Risk Committee, Remuneration Committee, Nomination & Governance Committee, and Sustainability & Safety Committee. The members of these committees were constituted in accordance with the requirements of the UK Corporate Governance Code, as applicable. The terms of reference of the committees have been prepared in line with prevailing best practice, including the provisions of the Code. A summary of the delegated duties and responsibilities, terms of reference of the committees and their activities for the year are presented in their committee reports set out below. Board Composition The Board’s composition prioritizes a broad range of perspectives, emphasizing professional experience, industry knowledge, and cognitive diversity. In recent years, the Board has strategically recruited members to enhance these attributes and is now focusing on a period of stability before considering further additions. Although the Board does not currently have any ethnically diverse members, it acknowledges the UK Listing Rules’ diversity targets, which the Group intends to continue to closely examine and evaluate in 2025. In 2024, the Board complied with the UK Listing Rules’ targets of (i) more than 40% female representation on the Board, with 43% of the Board being female and (ii) a female holding a senior Board position, with Ms. Kerrigan serving as the Senior Independent Director for the entirety through January 24, 2025 and Ms. Stash appointed to that role upon Ms. Kerrigan’s retirement from the Board. Board and Executive Management Composition As required to be presented in accordance with UK Listing Rule 6.6.6R(10) as of December 31, 2024: Gender Identity or Sex(a) Number of Board Members Percentage of the Board Number of Senior Positions on the Board (CEO, CFO, SID & Chair)(a) Number in Executive Management Percentage of Executive Management Male 4 57% 3 6 67% Female 3 43% 1 3 33% Other categories — —% — — —% Not specified/prefer not to say — —% — — —% 40 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Ethnic Background Number of Board Members Percentage of the Board Number of Senior Positions on the Board (CEO, CFO, SID & Chair)(a) Number in Executive Management Percentage of Executive Management White British or other White (including minority-white groups) 7 100% 4 9 100% Mixed/Multiple Ethnic Groups — —% — — —% Asian/Asian British — —% — — —% Black/African/Caribbean/Black British — —% — — —% Other ethnic group, including Arab — —% — — —% Not specific/prefer not to say — —% — — —% (a) The data reported on the basis of gender identity. The Board’s Directors are from the U.S. as well as the UK, bringing a range of domestic and international experience to the Board. The Board’s diverse range of experience and expertise covers not only a wealth of experience of operating in the natural gas and oil industry but also extensive technical, operational, financial, legal and environmental expertise. UK Corporate Governance Code Compliance Statement The Directors support high standards of corporate governance, and it is the policy of the Group to comply with current best practice in UK corporate governance. The UK Corporate Governance Code published in July 2018 by the Financial Reporting Council (“FRC”), as amended from time to time, (the “Corporate Governance Code”) recommends that: (i) the Chair of the Board of Directors should meet the independence criteria set out in the Corporate Governance Code on appointment; and (ii) the Board should appoint one of the Independent Non-Executive Directors to be the Senior Independent Director. The Chair of the Board is David E. Johnson, who was independent as of his appointment and whom the Group continues to consider independent, and the Senior Independent Director for the year ended December 31, 2024 was Sylvia Kerrigan. The Board also considers Sandra M. Stash, David J. Turner, Jr., Sylvia Kerrigan and Kathryn Z. Klaber to meet the independence criteria set out in the Corporate Governance Code. Following the resignation of Sylvia Kerrigan from the Board on January 24, 2025, Sandra Stash has been appointed as the Senior Independent Director. Since January 1, 2025, the Company has been subject to the UK Corporate Governance Code 2024 (the ”2024 Code”) and will report on its compliance with the principles and provisions of the 2024 Code in its 2025 Annual Report. Currently, the Board is of the opinion that as of the date of this report it fully complies with the requirements of the Corporate Governance Code. Additionally, the Directors acknowledge the requirement to implement a diversity policy that will be applicable to the Group’s administrative, management and supervisory bodies and the Remuneration, Audit & Risk and Nomination & Governance committees. For more details, refer to Board Composition and Workforce Composition within this Annual Report. Our Approach to Governance As of the date of this Annual Report, our Board is made up of six Directors: one Executive Director, chairman and four Non-Executive Directors (all of whom are independent, except one ). Alongside the continued focus on our business strategy, we achieved significant milestones in 2024 in strengthening core areas of the business. One such area of focus was corporate governance, where we engaged external consultants to advise on Board best practices, including independence, composition and expertise. Key Governance Improvements During 2024 The Board recognizes the benefits of good governance and is seeking to apply this in a meaningful way. DEC is a rapidly evolving company that is in an expansion and transition phase. Accordingly, the Board is acutely aware of the need to rapidly and effectively integrate new businesses into the reporting and governance framework of the Group, as determined by the Board. It is recognized that the Board has a key role in balancing the fundamental elements of good governance, namely to deliver business growth and build trust while maintaining a dynamic management framework. The Board appreciates the importance of good and effective communication and remains in close contact with its shareholders and other stakeholders. The Board is actively engaged in the process of solidifying its governance framework for its rapidly expanding business. The Board concluded that overall compliance with governance best practice has improved during the year under review, with the following having been achieved: • The Board re-affirmed several key governance policies including the following: Securities Dealing Policy, Whistleblowing Policy, Anti-Bribery & Corruption Policy, Socio-Economic Policy, Modern Slavery Policy, EHS Policy, Climate Policy, Employee Relations Policy, Human Rights Policy, Business Partners Policy, Biodiversity Policy, Code of Business Conduct & Ethics, and Tax Policy. • The Board achieved further progression of the Group’s overall corporate governance framework and practices, taking into account evolving market best practices and the Group’s NYSE-listing, including, among other things, a continued review and update of the Group’s committee charters and governance policies. • The Audit & Risk Committee is fully independent and continues to adopt best practice. • The Remuneration Committee is also independent with three Non-Executive Directors and the Non-Executive Chairman, and, together with a third- party consultant, conducted a thorough review of the remuneration policy and practices and undertook a consultation exercise with the Group’s largest shareholders. 41 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Each committee completed a thorough charter evaluation to identify gaps in coverage, relevance and applicability as well as potential areas of improvement. • Together with the executive management team, the Chairman and the Nomination & Governance Committee continued to formulate succession planning procedures and plans around key-roles in management. • The Board encouraged employee outreach and training regarding the Group’s Whistleblowing Policy and was satisfied by measures taken, including the placement of awareness posters with hotline details in all major offices. • Sylvia Kerrigan continued to serve as Senior Independent Director (for the entirety of 2024 and resigned as a director on January 24, 2025). Corporate Governance Practices and Foreign Private Issuer Status Companies listed on the NYSE must comply with the corporate governance standards provided under Section 303A of the NYSE Listed Company Manual. As a “foreign private issuer,” as defined by the SEC, we are permitted to follow home country corporate governance practices, instead of certain corporate governance practices required by the NYSE for U.S. domestic issuers, except that we are required to comply with Sections 303A.06, 303A.11 and 303A.12(b) and (c) of the Listed Company Manual. Under Section 303A.06, we must have an audit committee that meets the independence requirements of Rule 10A-3 under the Exchange Act. Under Section 303A.06, we must disclose any significant ways in which our corporate governance practices differ from those followed by domestic companies under NYSE listing standards. Finally, under Section 303A.12(b) and (c), we must promptly notify the NYSE in writing after becoming aware of any non-compliance with any applicable provisions of this Section 303A and must annually make a written affirmation to the NYSE. Further, an LSE listed company must disclose in its annual financial report a statement of how the listed company has applied the principles set out in the UK Corporate Governance Code, in a manner that would enable shareholders to evaluate how the principles have been applied, and a statement as to whether the listed company has (a) complied throughout the accounting period with all relevant provisions set out in the UK Corporate Governance Code; or (b) not complied throughout the accounting period with all relevant provisions set out in the UK Corporate Governance Code and if so, setting out: (i) those provisions, if any it has not complied with; (ii) in the case of provisions whose requirements are of a continuing nature, the period within which, if any, it did not comply with some or all of those provisions; and (iii) the company’s reasons for non-compliance. For the purposes of NYSE rules, so long as the Group qualifies as a foreign private issuer, we are eligible to take advantage of certain exemptions from NYSE corporate governance requirements provided in the NYSE rules. We are required to disclose the significant ways in which our corporate governance practices differ from those that apply to U.S. companies under NYSE listing standards. Section 312.03 of the NYSE Rules requires that a listed company obtain, in specified circumstances, (1) shareholder approval to adopt or materially revise equity compensation plans, as well as (2) shareholder approval prior to an issuance (a) of more than 1% of its ordinary shares (including derivative securities thereof) in either number or voting power to related parties, (b) of more than 20% of its outstanding ordinary shares (including derivative securities thereof) in either number or voting power or (c) that would result in a change of control. The Group intends to follow home country law in determining whether shareholder approval is required. Section 302 of the NYSE Rules also requires that a listed company hold an annual shareholders’ meeting for holders of securities during each fiscal year. We will follow home country law in determining whether and when such shareholders’ meetings are required. The Group may in the future decide to use other foreign private issuer exemptions with respect to some or all of the other requirements under the NYSE Rules. Following our home country governance practices may provide less protection than is accorded to investors under the NYSE listing requirements applicable to domestic issuers. We intend to take all actions necessary for us to maintain compliance as a foreign private issuer under the applicable corporate governance requirements of the Sarbanes-Oxley Act of 2002, the rules adopted by the SEC and NYSE listing standards. Because we are a foreign private issuer, our directors and senior management are not subject to short swing profit and insider trading reporting obligations under Section 16 of the Exchange Act. They will, however, be subject to the obligations to report changes in share ownership under Section 13 of the Exchange Act and related SEC rules. 42 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Board of Directors The Group has a commitment to strong governance, reporting and operating standards. During 2024, the Board comprised of seven Directors: including a Non-Executive Chair (who was independent upon appointment and whom the Group continues to consider independent), a Non-Executive Vice-Chair, an Executive Director, the Senior Independent Director, three additional independent Non-Executive Directors. David E. Johnson Rusty Hutson, Jr. Martin K. Thomas Non-Executive Chairman, independent upon appointment Co-Founder and Chief Executive Officer Non-Executive Vice Chair, independent through December 31, 2023 Age 64 55 60 Appointed February 3, 2017 and as Chair of the Board on April 30, 2019 July 31, 2014 January 1, 2015 Committee Membership Remuneration Committee, Sustainability & Safety Committee None Nomination & Governance Committee Experience Mr. Johnson has served on our Board of Directors since February 2017 and as the Independent Chairman since April 2019. He has worked at a number of leading investment firms, as both an investment analyst and a manager, and more recently in equity sales and investment management. Mr. Johnson currently serves on the board of Chelverton Equity Partners, an AIM-listed holding company, where he serves as a member of the Remuneration, Audit and Nomination committees. Previously, Mr. Johnson was a consultant at Chelverton Asset Management from August 2016 to February 2019. Prior to that, he worked as a fund manager for the investment department a large insurance company and then as Head of Sales and Head of Equities at a London investment bank. Mr. Johnson earned a Bachelor of Arts in Economics from the University of Reading. Mr. Hutson is our co-founder and has served as our Chief Executive Officer since the founding of our predecessor entity in 2001. Mr. Hutson also serves on our Board of Directors. Mr. Hutson is the fourth generation in his family to immerse himself in the natural gas and oil industry, with family roots dating back to the early 1900s. Mr. Hutson spent many summers of his youth working with his father and grandfather in the oilfields of West Virginia. He graduated from Fairmont State College (WV) with a degree in accounting. After college, Mr. Hutson spent 13 years steadily progressing into multiple leadership roles at well-known banking institutions such as Bank One and Compass Bank. His final years in the banking industry were spent as CFO of Compass Financial Services. Building upon his experiences in the natural gas and oil industry, as well as the financial sector, Mr. Hutson established Diversified Energy Company in 2001. After years of refining his strategy, Mr. Hutson and his team took Diversified public in 2017. He continues to lead his team and expand the Group’s footprint. With a rapidly growing portfolio, Mr. Hutson remains focused on operational excellence and creating shareholder value. Mr. Thomas has served on our Board of Directors since January 2015. Since January 2022, Mr. Thomas has served as a consultant at the law firm Wedlake Bell LLP, from where he was previously a Partner from January 2018 to December 2021. During his more than 30-year legal career, Mr. Thomas has also served as Partner of Watson Farley & Williams LLP from February 2015 to April 2017 and as consultant of the same firm from May 2017 to May 2018. Mr. Thomas earned a Bachelor of Laws from the University of Reading and completed his Law Society Final Examinations at The College of Law in the UK. Key Strengths Investment sector knowledge; finance; providing strong leadership to the Board in connection with the Board’s role of overseeing strategy and developing stakeholder relations. Deep understanding and leadership in the natural gas and oil sector; strong track record in developing and delivering results in line with strategy; finance; risk management. Corporate law; advising on mergers and acquisitions; public offerings. Current External Roles Chelverton Equity Partners (Director), an AIM-listed holding company Board of Governors of West Virginia University Wedlake Bell LLP (Consultant) and Jasper Consultants Limited (Director) 43 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Board of Directors (continued) Sandra M. Stash David J. Turner, Jr. Kathryn Z. Klaber Independent Non-Executive Director & Non-Executive Director Employee Representative Independent Non-Executive Director Independent Non-Executive Director Age 65 61 58 Appointed October 21, 2019 May 27, 2019 January 1, 2023 Committee Membership Sustainability & Safety Committee (Chair), Remuneration Committee, Audit & Risk Committee Audit & Risk Committee (Chair), Remuneration Committee (appointed Chair on January 24, 2025), Nomination & Governance Committee Nomination & Governance Committee (Chair), Audit & Risk Committee, Sustainability & Safety Committee Experience Ms. Stash has served on our Board of Directors since October 2019. Ms. Stash joined Tullow Oil in October 2013 serving as Executive Vice President of Safety, Operations and Engineering, and External Affairs where she served until March 2020. Ms. Stash is a Certified Director of the US National Association of Corporate Directors and a Fellow of the Canadian Academy of Engineering and currently serves on the boards of Medallion Midstream LLC, Trans Mountain Company, Warriors and Quiet Waters as Chair, the Colorado School of Mines Board of Governors, First Montana Bank, and the African Gifted Foundation. Ms. Stash earned a Bachelor of Science in Petroleum Engineering from the Colorado School of Mines and is a Registered Professional Engineer Mr. Turner has served on our Board of Directors since May 2019. Mr. Turner has served as Chief Financial Officer of Regions Financial Corporation (NYSE: RF) since 2010 where he leads all finance operations, including mergers and acquisitions, financial systems, investor relations, corporate treasury, corporate tax, management planning and reporting and accounting. Prior to his appointment as Chief Financial Officer, Mr. Turner oversaw the Internal Audit Division for AmSouth Bank (which merged with Regions Financial Corporation in 2006) from April 2005 to March 2010. Before beginning his banking career, Mr. Turner was a certified public accountant and an Audit Partner with Arthur Andersen and KPMG specializing in financial services clients. He earned a Bachelor of Science in Accounting from the University of Alabama. Ms. Klaber has served on our Board of Directors since January 2023. Since 2014, Ms. Klaber has served as the Managing Director of The Klaber Group, which provides strategic consulting services to businesses and organizations with a focus on energy development in the United States and abroad. Prior to founding The Klaber Group, Ms. Klaber launched the Marcellus Shale Coalition, serving as its first CEO from 2009 to 2013. Previously in her career, Ms. Klaber also served as the Executive Vice President for Competitiveness at the Allegheny Conference on Community Development, Executive Director of the Pennsylvania Economy League, and consultant at Environmental Resources Management, where she gained significant experience in EHS strategy and compliance. Ms. Klaber received her B.A. in Environmental Science from Bucknell University and her MBA from Carnegie Mellon University. Key Strengths Risk management & sustainability; operations & engineering; employee engagement. Financial expert with recent and relevant experience; capital markets; financial operations; audit experience; risk management. Regulatory compliance, energy specific sustainability programs; EHS processes industry knowledge, risk management; governance. Current External Roles Colorado School of Mines (Board of Governors member), Trans Mountain Company, Warriors and Quiet Waters, a Canadian Crown Corporation (Chair and Director), First Montana Bank (Director), and Medallion Midstream, LLC (Director) Regions Financial Corporation (CFO), Junior Achievement of Alabama, Inc. (Board and Executive Committee), Leadership Alabama (Director), a nonprofit organization, and Five Star Preserve (Director), a nonprofit organization RLG International (Director), Junior Achievement of Western Pennsylvania (Director and immediate past-Chair), and Beaver County Chamber of Commerce (Beaver County, Pennsylvania) (Chair) 44 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Board of Directors (continued) Senior Management Sylvia Kerrigan Bradley G. Gray Ben Sullivan Senior Independent Non-Executive Director (ceased to be a director on January 24, 2025) President and Chief Financial Officer Senior Executive Vice President, Chief Legal & Risk Officer, and Corporate Secretary Age 59 56 46 Appointed October 11, 2021 Committee Membership Remuneration Committee (Chair for entirety of 2024 through January 24, 2025), Nomination & Governance Committee Experience Ms. Kerrigan has served on our Board of Directors since October 2021. Currently, she is the Chief Legal Officer at Occidental Petroleum Corporation (NYSE: OXY). Prior to joining Occidental, Ms. Kerrigan served as the Executive Director of the Kay Bailey Hutchinson Center for Energy, Law and Business at the University of Texas, where she remains a member of the Executive Council. In Ms. Kerrigan’s more than 20 years with Marathon Oil Corporation, she served in a number of roles overseeing public policy, legal and compliance, corporate positioning and external communications before retiring in 2017 after eight years as the Executive Vice President, General Counsel and Corporate Secretary. Ms. Kerrigan has also served as a director for Hornbeck Offshore Services, Inc. since August 2022 and Board of Trustees for Southwestern University since March 2014. Ms. Kerrigan holds a Directorship Certification through the National Association of Corporate Directors. Ms. Kerrigan earned a Bachelor of Arts from Southwestern University and a Doctor of Jurisprudence from the University of Texas at Austin School of Law. Mr. Gray has served as our President and Chief Financial Officer since September 2023. Mr. Gray has also served as the Group’s Executive Vice President, Chief Operating Officer since October 2016 to September 2023. Mr. Gray has also served on the Board of Directors until September 2023. Prior to joining the Group, Mr. Gray served as the Senior Vice President and Chief Financial Officer for Royal Cup, Inc. from August 2014 to October 2016. Prior to that, from 2006 to 2014, Mr. Gray served in various roles at The McPherson Companies, Inc., most recently as Executive Vice President and Chief Financial Officer from September 2006 to December 2013. Mr. Gray previously worked in various financial and operational roles at Saks Incorporated from 1997 to 2006. Mr. Gray has a B.S. degree in Accounting from the University of Alabama and was formerly a licensed CPA (Alabama). Mr. Sullivan has served as our Senior Executive Vice President, Chief Legal & Risk Officer, and Corporate Secretary since September 2023, and prior to that served as Executive Vice President, General Counsel and Corporate Secretary since 2019. Prior to joining us, Mr. Sullivan worked with Greylock Energy, LLC (an ArcLight Capital Partners portfolio company) and its predecessor, Energy Corporation of America, from 2012 to 2017, most recently as Executive Vice President, General Counsel and Corporate Secretary from 2017 to 2019. Prior to that, Mr. Sullivan served as counsel for EQT Corporation from 2006 to 2012. He is a member of the leadership and board of directors of several commerce, legal and industry groups, and has considerable experience in corporate governance and reporting, corporate responsibility and sustainability matters, complex commercial transactions, land/real estate, acquisitions & divestitures, financing, government investigations and corporate workouts and restructurings. Mr. Sullivan received a B.A. from the University of Kentucky and a J.D. degree from the West Virginia University College of Law. He holds licenses to practice law in several states, including Pennsylvania and West Virginia. Key Strengths Corporate law; governance; merger and acquisition; regulatory; risk management; cybersecurity and information privacy matters; corporate responsibility and sustainability. Corporate structure; operational processes and management; finance; strategic support to the CEO; mergers and acquisitions; acquisition integration; information technology; personnel leadership. Legal expert, mergers and acquisitions, land/real estate, regulatory compliance and governance, risk management and strategic support to the CEO. Current External Roles Occidental Petroleum (Chief Legal Officer), Kay Bailey Hutchinson Center for Energy, Law and Business at the University of Texas (Director), and Hornbeck Offshore Services, Inc. (Director) None None 45 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Directors’ Report The Directors present their report on the Group, together with the audited Group Financial Statements , for the year ended December 31, 2024. Board of Directors The Directors of the Group who were in office during the year and up to the date of signing the financial statements were: • David E. Johnson - Non-Executive Chair (independent upon appointment) • Rusty Hutson, Jr. - Chief Executive Officer and Executive Director • Martin K. Thomas - Non-Executive Vice Chair • David J. Turner, Jr. - Independent Non-Executive Director • Sandra M. Stash - Independent Non-Executive Director • Sylvia Kerrigan - Senior Independent Non-Executive Director (for the entirety of 2024 through January 24, 2025) • Kathryn Z. Klaber - Independent Non-Executive Director Incorporation and Listing The Company was incorporated on July 31, 2014, and completed the transfer to the Official List of the Financial Conduct Authority (“FCA”) and admission to the Main Market of the LSE from AIM in May 2020. The Company commenced trading on the New York Stock Exchange (“NYSE”) on December 18, 2023. Following the changes to the UK Listing Rules on 29 July 2024, the Premium Listing Segment was replaced by the Equity Shares (Commercial Companies) category and the Company continues to remain listed on the new equity shares (commercial companies) category of the Official List of the Financial Conduct Authority. Review of Business, Outlook & Dividends The Group is a natural gas, NGLs and oil producer and midstream operator and is focused on acquiring and operating mature producing wells with long lives and low-decline profiles. The Group’s assets have historically been located within the Appalachian Region, but the Group has acquired assets expanding its footprint into the Central Region, consisting of the states of Louisiana, Texas and Oklahoma. The Group is headquartered in Birmingham, Alabama, U.S., and has field offices located throughout the states in which it operates. Details of the Group’s progress during the year and its future prospects are provided in the Strategic Report within this Annual Report . Results The Group’s reported statutory loss for 2024 was $87 million, or $1.84 per share, and when adjusted for certain non-cash items, it reported adjusted EBITDA of $472 million. The Group’s adjusted EBITDA for 2023 was $547 million. For more information on adjusted EBITDA refer to APMs within this Annual Report . Dividend Approach The Board’s target has been to return free cash flow to shareholders by way of dividend, on a quarterly basis, in line with the strength and consistency of the Group’s cash flows. For the three months ended March 31, 2024 , the Group paid a dividend of $0.290 per share on September 27, 2024. For the three months ended June 30, 2024, the Group paid a dividend of $0.290 per share on December 27, 2024. For the three months ended September 30, 2024, the Group expects to pay a dividend of $0.290 per share on March 31, 2025. For the three months ended December 31, 2024, the Group expects to pay a dividend of $0.29 per share. The Directors may further revise the Group’s approach to dividends from time to time in line with the Group’s actual results and financial position. The Board’s approach to its dividend reflects the Group’s current and expected future cash flow generation potential. Disclosure of Information under UKLR 6.6.1R The information that fulfills the reporting requirements under this rule can be found in the locations identified below. Section Topic Location (1) Interest capitalized Not applicable (2) Publication of unaudited financial information Not applicable (4) Details of long-term incentive schemes The Remuneration Committee's Report (5) Waiver of emoluments by a Director Not applicable (6) Waiver of future emoluments by a Director Not applicable (7) Non pre-emptive issues of equity for cash Share Capital (8) As item (7), in relation to major subsidiary undertakings Not applicable (9) Parent participation in a placing by a listed subsidiary Not applicable (10) Contracts of significance Not applicable (11) Provision of services by a controlling shareholder Not applicable (12) Shareholder waivers of dividends Not applicable (13) Shareholder waivers of future dividends Not applicable (14) Agreements with controlling shareholders Not applicable 46 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Directors’ Interest in Shares The Directors’ beneficial interests in the Group’s share capital, including family interests, on December 31, 2024 are shown below. These interests are based on the issued share capital at that time. As of February 28, 2025, there have been no changes to the Directors’ interests. The Non-Executive Directors will purchase shares after the release of this Annual Report pursuant to the Non-Executive Director Share Purchase Program implemented in 2022. Director Appointed Shares of £0.20 % of Issued Share Capital Rusty Hutson, Jr. July 31, 2014 1,234,134 2.41% Martin K. Thomas January 1, 2015 113,850 0.22% David E. Johnson February 3, 2017 23,750 0.05% David J. Turner, Jr. May 27, 2019 33,087 0.06% Sandra M. Stash October 21, 2019 4,092 0.01% Kathryn Klaber January 1, 2023 2,912 0.01% Sylvia Kerrigan October 11, 2021 3,181 0.01% 1,415,006 2.77% Future Developments The Directors continue to review and evaluate strategic acquisition opportunities recommended by the Senior Leadership Team, which align with the strategy and requirements of the Group. Additional details are disclosed in Strategy within this Annual Report. Share Capital As of December 31, 2024, the Group’s issued share capital consisted of 51,295,942 shares with a par value of £0.20 each, with ~45% of record holders in the U.S. and ~55% of record holders in the UK. The Group has only one class of share and each share carries the right to one vote at the Group’s AGM. No person has any special rights of control over the Group’s share capital and all issued shares are fully paid. There are no specific restrictions on the size of a holding nor on the transfer of shares, which are both governed by the general provisions of the Group’s Articles of Association and prevailing legislation. The Directors are not aware of any agreements between holders of the Group’s shares that may result in restrictions on the transfer of securities or on voting rights. The Group was authorized by shareholders at the 2024 AGM held on May 10, 2024 to purchase in the market up to 10% of its issued shares (excluding any treasury shares), subject to certain conditions laid out in the authorizing resolution. The standard authority is renewable annually; the Directors will seek to renew this authority at the upcoming AGM. Details of shares issued and repurchased by the Group during the period are set out in Note 16 in the Notes to the Group Financial Statements. In the second half of 2024, the Company issued 4,592,095 new ordinary shares at an average $12.13 per share (£9.41 ) for aggregate gross proceeds of $56 million to fund a portion of the East Texas II and Crescent Pass transactions, discussed in Note 5. The new shares issued represented 9% of the Company’s existing share capital as of December 31, 2024. Employee Benefit Trust An Employee Benefit Trust (“EBT”) was established in 2022 to purchase shares already in the market and is operated through a third-party trustee. The objective of the EBT is to benefit the Group’s employees and in particular, to provide a mechanism to satisfy rights to shares arising on the exercise or vesting of awards under the Group’s share-based incentive plans and reduce dilution for shareholders. As of February 28, 2025, the EBT holds 646,098 shares and has distributed 561,566 shares under the Group’s share-based incentive plans. Financial Instruments Details of the Group’s principal risks and uncertainties relating to financial instruments are detailed below and in Note 25 in the Notes to the Group Financial Statements. Risk Management Risk management is integral to all of the Group’s activities. Each member of executive management is responsible for continuously monitoring and managing risk within the relevant business areas. Every material decision is preceded by an evaluation of applicable business risks. Reports on the Group’s risk exposure and reviews of its risk management are regularly undertaken and presented to the Board. Additional details regarding the Group’s risk management can be found in Principal Risks and Uncertainties in the Strategic Report within this Annual Report. Securities Dealing Code The Group adopted a Securities Dealing Code for share dealings reasonably designed for a company listed on the equity shares (commercial companies) category of the Official List of the FCA and admitted to the Main Market of the LSE and NYSE-listed company to promote compliance with insider trading laws, rules, regulations and applicable listing standards. The code applies to the Directors, members of the Senior Leadership Team and other relevant employees of the Group and is monitored by the Group’s compliance-focused employees. Other Corporate Governance Policies The Board reviewed, updated, and reaffirmed several key governance policies in 2024, including the following: • Whistleblowing Policy - aims to provide guidance as to how individuals may raise their concerns and to ensure that they may do so confidently and confidentially. • Anti-Bribery & Corruption Policy - acknowledges the Group’s commitment to right and ethical practices and addresses bribery and corruption risk as a part of the Group’s overall risk management strategy. 47 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Socio-Economic Policy - affirms the Group’s commitment to being recognized as a leader in the field of corporate responsibility and recognizes the added value for our shareholders. • Modern Slavery Policy - recognizes that modern slavery is a significant global human rights issue and has many forms including human trafficking, forced labor, child labor, domestic servitude, people trafficking and workplace abuse. The Group is committed to respecting internationally recognized human rights, including ensuring that we are in no way involved or associated with the issue of forced or involuntary labor and that modern slavery and human trafficking are not taking place in any part of our business. • EHS Policy - guides activities to protect employees, contractors, the public and the environment. • Climate Policy - recognizes that climate change is a complex global issue that may have an impact of the Group’s operations, processes, equipment and capabilities. • Employee Relations Policy - acknowledges the value of the Group’s employees and highlights the Group’s commitments to promote employee safety, health and well-being. • Human Rights Policy - recognizes the Group’s commitment and responsibility to ensure that human rights are upheld in every of its business operations and to promote human rights where it can make a positive contribution. • Business Partners Policy - provides the standards the Group expects from its consultants, outsourced providers, subcontractors, vendors and suppliers to adhere to in their business activities with the Group. • Biodiversity Policy - outlines the Group’s commitment to promote a net positive impact on the environment and its natural biodiversity. • Code of Business Conduct & Ethics - provides the standards the Group expects from its Directors, officers and employees, including honest and ethical conduct, compliance with applicable laws and prompt internal reporting and accountability for adherence to the code. • Tax Policy - outlines the Group’s tax objections and the foundation of the Group’s tax approach. These corporate governance policies can be viewed on the Group’s website at www.div.energy/about-us/corporate-governance. Subsequent Events Refer to Note 28 in the Notes to the Group Financial Statements. Director Attendance at Board and Committee Meetings Directors are expected to attend and participate in all Board meetings and meetings of committees on which they serve and are expected to be available for consultation with management as requested from time to time. Regular Board and committee meetings are held at such times as the Board and committees, respectively, may determine. Special meetings may be called upon appropriate notice at any time. The following table shows the number of Board and committee meetings required to be held and actually held in 2024 : Type of Meeting Number of Meetings Required to be Held Number of Meetings Held Board of Directors — 10 Audit & Risk Committee 3 5 Nomination & Governance Committee 2 3 Remuneration Committee 2 3 Sustainability & Safety Committee 2 6 Members of the Board attended Board and committee meetings (to the extent they were members of such committee in 2024) as summarized in the following table. Director Committee Seats (during 2024 ) Board Audit & Risk Committee Nomination & Governance Committee Sustainability & Safety Committee Remuneration Committee Rusty Hutson, Jr. None 10 — — — — David E. Johnson R,S 10 — — 6 3 Martin K. Thomas N 10 — 3 — — Kathryn Z. Klaber N,A,S 10 5 3 6 — Sandra M. Stash S,A,R 10 5 — 6 3 David J. Turner, Jr. A,R 10 5 — — 3 Sylvia Kerrigan R,N 10 — 3 — 3 Directors’ Indemnities As permitted by the Group’s Articles of Association, the Directors have the benefit of an indemnity, which is a qualifying third-party indemnity provision as defined by Section 234 of the Companies Act 2006. The indemnity was in force during the financial year and remains in force at the date of this report. The Group also purchased and maintained throughout the financial period Directors’ and officers’ liability insurance in respect of itself and its Directors. This confirmation is given and should be interpreted in accordance with the provisions of Section 418 of the Companies Act 2006. 48 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Conflict of Interest There are no potential conflicts of interest between any duties owed by the Directors or members of the Senior Leadership Team to the Group and their private interests and/or other duties. In addition, there are no arrangements or understandings with any of the shareholders of the Group, customers, suppliers or others pursuant to which any Director or member of the Senior Leadership Team was selected to be a Director or Senior Manager. The Group tests regularly to ensure awareness of any future potential conflicts of interest and related party transactions. Directors are required to declare any additional or changed interests at the beginning of each Board meeting. In the event a conflict should arise, the pertinent Director would not take part in decision making related to the conflict. Additionally, there are no family relationships among any of our Directors or Senior Managers Substantial Shareholders As of February 26, 2025 , the following shareholders hold greater than 3% of the Group’s issued shares with voting rights: Shareholders(a) Number of Shares % of Issued Share Capital BlackRock 4,909,399 8.21% Columbia Management Investment Advisers 3,251,605 5.44% Jupiter Asset Management 2,792,978 4.67% Maverick Natural Resources 2,342,445 3.92% Hargreaves Landsdown 2,108,083 3.53% Interactive Investor 2,052,048 3.43% (a) The Group derives the information from TR1 notifications, its third-party performed annual shareholder analysis to support its Foreign Private Issuer status as a U.S. Corporation listed on the LSE, and from periodic third-party share register reports it receives. Independent Auditors The independent auditors, PricewaterhouseCoopers LLP (“PwC”), have expressed their willingness to continue in office as auditors and a resolution to reappoint PricewaterhouseCoopers LLP will be proposed at the forthcoming AGM. Corporate Governance Statement The Directors recognize the importance of sound corporate governance and their associated report is set out in the Chairman’s Governance Statement within this Annual Report . The Group reports against the UK Corporate Governance Code. As further described in the UK Corporate Governance Code Compliance Statement provided within this Annual Report, the Group is currently in compliance with the Corporate Governance Code other than as set out therein. Engagement with Employees’ Statement The Group is exempted from some reporting requirements, as it did not employ more than 250 employees in the UK during the year under review. As of December 31, 2024, the Group had 1,589 full-time employees, with 1,187 production employees and 402 production support employees across our ten - state operating footprint in the U.S. In line with industry standards in the country of employment, our employees maintain a range of relationships with union groups. The Group has not previously experienced labor-related work stoppages or strikes and believe that our relations with union groups and our employees are satisfactory. As per Section 54(1) of the Modern Slavery Act 2015, our Modern Slavery Policy is reviewed and approved by the Board annually and published on our website. The statement covers the activities of the Group and details policies, processes and actions we have taken to ensure that slavery and human trafficking are not taking place in our supply chains or any part of our business. More information on our Modern Slavery Policy can be found on our website. Pursuant to the Group’s Employee Handbook, the Group will endeavor to make reasonable accommodation to the known physical or mental limitations of qualified employees with disabilities. Engagement with Stakeholders’ Statement The Group adheres to best-in-class operating standards, with a strong focus on EHS to ensure the safety of its employees, local communities and the environment in which the Group operates. This element of reporting is discussed in the Section 172 Statement and Sustainability & Safety Committee’s Report within this Annual Report . Furthermore, the Director designated to engage with the workforce as required under the Corporate Governance Code is currently Sandra M. Stash. Relations with Shareholders The Group aims to maintain its committed approach to long-term sustainability, which, alongside its strict fiscal discipline and stewardship, maximizes returns to its shareholders. The Directors attach great importance to maintaining good relationships with shareholders. Extensive information about the Group’s activities is included in its annual and interim reports and accounts and related presentations. The Group also issues regular updates to shareholders. Persons possessing market sensitive information are notified in accordance with the Market Abuse Regulation. The Group is active in communicating with both its institutional and private shareholders. The AGM provides an opportunity for all shareholders to communicate with and to question the Board on any aspect of the Group’s activities. The Group maintains a corporate website at www.div.energy where information on the Group is regularly updated, including Annual and Interim Reports and all announcements. The Directors are available for communication with shareholders and all shareholders have the opportunity, and are encouraged, to attend and vote at the AGM of the Group during which the Board will be available to discuss issues affecting the Group. The Board stays informed of shareholders’ views via regular meetings and other communications they may have with shareholders. 49 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance At the 2024 AGM, while shareholders approved most of the resolutions with majorities in excess of 99%, Resolution 19 (Amendment to 2017 Equity Incentive Plan to increase the number of shares available under the Plan), while receiving 74% of the vote "FOR", did not meet the 75% threshold to pass. Following the AGM, the Group consulted and engaged with a number of shareholders who voted against the resolutions to better understand their concerns. The Directors are thankful to the shareholders for sharing their views. They understand that the negative vote was principally related to the disconnect between traditional equity compensation plans in the United States, the Group’s primary operating market, in relation to traditional compensation practices in the United Kingdom and the mechanics of recalibrating the Equity Incentive Plan after approximately seven years of existence. The dialogue with the shareholders has highlighted that there remains strong support for the Group’s equity incentive arrangements. The Board has discussed the feedback received in detail and continues to actively dialogue with shareholders on the equity incentive and compensation arrangements. Environmental Information The Group adheres to best-in-class operating standards, with a strong focus on EHS to ensure the safety of its employees. There is extensive coverage of these issues within the Group’s 2024 Sustainability Report which will be available on its website at www.div.energy and in the Sustainability & Safety Committee’s Report within this Annual Report. Workforce Composition We believe that a workforce with a broad range of skills, experiences, and perspectives contributes to a successful and sustainable business. We value the unique talents, expertise, and creativity that individuals bring to the Group. The Group is committed to fostering a work environment where employees are evaluated based on their contributions and abilities. Decisions related to recruitment, selection, development, and promotion are based on merit and qualifications, ensuring that individuals are considered fairly. The Group does not discriminate on the basis of race, color, religion, national origin, ancestry, citizenship, age, disability, sex, marital status, pregnancy, veteran status, sexual orientation, gender identity, genetic information, or any other characteristic protected by applicable law. All applicants receive full and fair consideration for employment opportunities, and career development, compensation, and advancement are based on objective criteria. Additionally, employees who experience changes in their abilities while working within the Group are supported through retraining and other resources to facilitate their continued success. Charitable & Political Donations The Group did not make any political donations or incur any political expenditures to candidates or political campaigns or candidates during the period. During the year, the Group contributed nearly $2.1 million to numerous community organizations. Refer to Serving Our Communities within this Annual Report. Going Concern The Directors have given careful consideration to the appropriateness of the going concern basis in the preparation of the financial statements. The validity of the going concern concept is dependent on funding being available for the working capital requirements of the Group in order to finance the continuing development of its existing projects for at least the next 12 months. Sufficient funds are available in the short-term to fund the working capital requirements of the Group. The Directors believe that this will enable the Group to continue in operational existence for the foreseeable future and to continue to meet obligations as they fall due. Refer to Viability and Going Concern within this Annual Report for a summary of the Directors’ assessment. Annual General Meeting The AGM of the Group will be held in London on April 9, 2025. Full details of these proposals will be set out in a separate Notice of AGM sent to all shareholders. Shareholders are invited to complete the proxy form/form of instruction received either by post or vote electronically in CREST in accordance with the Notes contained in the Notice of the AGM. The Notice of the AGM and Proxy Form/form of instruction are available on the Group’s website at www.div.energy. Additional Disclosures Supporting information that is relevant to the Directors’ report, which is incorporated by reference into this report, can be found throughout this Annual Report. For considerations of post balance sheet events refer to Note 28 in the Notes to the Group Financial Statements within this Annual Report. Statement of Directors’ Responsibilities in Respect of the Financial Statements The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulation. Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have prepared the Group Financial Statements in accordance with UK-adopted international accounting standards and the Company Financial Statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law). In preparing the group financial statements, the directors have also elected to comply with International Financial Reporting Standards issued by the International Accounting Standards Board (IFRSs as issued by IASB). Under company law, Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss of the Group for that period. In preparing the financial statements, the Directors are required to: • Select suitable accounting policies and then apply them consistently; • State whether applicable UK-adopted international accounting standards and IFRSs issued by IASB have been followed for the Group Financial Statements and United Kingdom Accounting Standards, comprising FRS 102 have been followed for the Company Financial Statements, subject to any material departures disclosed and explained in the financial statements; • Make judgments and accounting estimates that are reasonable and prudent; and 50 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and Company will continue in business. The Directors are responsible for safeguarding the assets of the Group and Company and, hence, for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors are also responsible for keeping adequate accounting records that are sufficient to show and explain the Group’s and Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and enable them to ensure that the financial statements and the Directors’ Remuneration Report comply with the Companies Act 2006. The Directors are responsible for the maintenance and integrity of the Company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Directors’ Confirmations The Directors consider that the Annual Report and accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group’s and Company’s position and performance, business model and strategy. Each of the Directors, whose names and functions are listed in Directors' Report confirm that, to the best of their knowledge: • The Group Financial Statements, which have been prepared in accordance with UK-adopted international accounting standards and IFRSs issued by IASB, give a true and fair view of the assets, liabilities, financial position and loss of the Group; • The Company Financial Statements, which have been prepared in accordance with United Kingdom Accounting Standards, comprising FRS 102, give a true and fair view of the assets, liabilities, and financial position of the Company; and • The Strategic Report includes a fair review of the development and performance of the business and the position of the Group and the Company, together with a description of the principal risks and uncertainties that it faces. In the case of each Director in office at the date the Directors’ Report is approved: • So far as that Director is aware, there is no relevant audit information of which the Group’s and the Company’s auditors are unaware; and • They have taken all the steps that they ought to have taken as a Director in order to make themselves aware of any relevant audit information and to establish that the Group’s and Company’s auditors are aware of that information. This Annual Report was approved by the Board of Directors and authorized to be issued on March 17, 2025. On behalf of the Board: David E. Johnson Chairman of the Board March 17, 2025 The Nomination & Governance Committee’s Report Committee Composition • Kathryn Z. Klaber, Chair • Martin K. Thomas • Sylvia Kerrigan (for the entirety of 2024 through January 24, 2025) • David J. Turner, Jr. (joined as of January 24, 2025) Key Objective The Nomination & Governance Committee assists the Board in (i) discharging its responsibilities related to reviewing its structure, size and composition, (ii) recommending to the Board any changes required for succession planning and monitoring governance trends and best practices, and (iii) identifying and nominating for approval Board candidates to fill vacancies as and when they arise. The Nomination & Governance Committee is responsible for leading the process for appointments, ensuring plans are in place for orderly succession for both the Board and senior management positions, and overseeing the development of a diverse pipeline for succession. The Nomination & Governance Committee is responsible for reviewing the results of the Board’s Performance Review process and for making recommendations to the Board concerning suitable candidates for the role of Senior Independent Director, the membership of the Board’s committees and the election or re-election of Directors at each AGM. The Nomination & Governance Committee also oversees the Group’s governance structure and monitors trends and compliance with governance best practices. Key Matters Discussed by the Committee During the past year the Nomination & Governance Committee: • Led the annual Board Performance Review process over the course of the year, which included (i) an evaluation of the structure, agendas and outcomes of Board and Board committee meetings and (ii) a comprehensive report and roundtable exercise with the entire Board; • Took steps with senior management to develop a training regime for the entire Board for the 2024 year and beyond, with training from internal personnel and external resources on topical subjects such as governance, oversight and Director responsibilities; • Assessed the member composition of each Board committee to ensure alignment with best practices for Board and committee independence. 51 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Conducted (together with senior management) a committee-by-committee assessment process to evaluate and provide feedback to each committee chair; • Worked with the Senior Independent Director and senior management to facilitate the Senior Independent Director’s review of the Chairman; • Worked with the Chairman and senior management to facilitate the review of the CEO; • Worked with the Chief Human Resources Officer and Chief Legal & Risk Officer to formulate succession planning procedures and plans around key- roles in management; • Worked with the Chief Legal & Risk Officer on an evaluation of trends in hiring and onboarding practices and legal risk mitigation related to the same; • Reviewed management’s stakeholder engagement efforts and advised on strategy and best practices; • Reviewed and updated the Nomination & Governance Committee’s Terms of Reference to reflect best practices; • Continued to work with external advisors and senior management to analyze, assess and implement an enhanced governance framework related to the Group’s NYSE and LSE listings, including, among other things, a review and update of the Group’s committee charters and governance policies; and • Encouraged and maintained oversight of employee outreach and training regarding the Group’s Whistleblowing Policy and was satisfied by measures taken, including the placement of awareness posters with hotline details in all major offices. Committee Effectiveness The Nomination & Governance Committee performed a critical analysis internal review and evaluation on itself, as part of its annual self-review process. No significant areas of concern were raised. Membership For 2024, the Nomination & Governance Committee comprised of three Non-Executive Directors, two of whom were considered independent: Ms. Klaber (independent), the Nomination & Governance Committee Chair, Mr. Thomas, and Ms. Kerrigan (independent). Ms. Kerrigan served on the Nomination & Governance Committee for the entirety of 2024 and resigned from the Board of Directors on January 24, 2025. Mr. Turner has been appointed to the Nomination & Governance Committee with effect from January 25, 2025. Benjamin Sullivan, Senior Executive Vice President, Chief Legal & Risk Officer and Corporate Secretary acts as Secretary to the Nomination & Governance Committee. Meetings and Attendance The Nomination & Governance Committee met three times in 2024 and has met once thus far in 2025. At the end of each Nomination & Governance Committee meeting, the committee typically meets in private executive session without management present to ensure that points of common concern are identified and that priorities for future attention by the committee are agreed upon. The Chair of the Nomination & Governance Committee keeps in close contact with the Chief Executive Officer and Chief Legal & Risk Officer between committee meetings. For Nomination & Governance Committee meeting attendance for each Director see the Directors’ Report within this Annual Report. Responsibilities and Terms of Reference The Nomination & Governance Committee’s main duties are: • Reviewing the structure, size and composition of the Board (including the skills, knowledge and experience of its members) and making recommendations to the Board with regard to any changes required; • Identifying and nominating, for Board approval, candidates to fill Board vacancies as and when they arise; • Succession planning for Directors and other senior managers; • Reviewing annually the time commitment required of Non-Executive Directors; and • Overseeing the Group’s governance structure as well as trends and compliance in governance best practices. The Nomination & Governance Committee has formal terms of reference which can be viewed on the Group’s website. Due to other commitments, Ms. Kerrigan resigned from the Group’s Board of Directors effective as of January 24, 2025. Ms. Kerrigan provided invaluable leadership, experience, insight, and steadfast support throughout her tenure on the Board, including on legal and industry related matters. As succession planning is one of the Nomination & Governance Committee’s main duties, it will be reviewing whether Ms. Kerrigan’s resignation would lend itself to a determination that the Group should identify and nominate of a new board member who embodies similar leadership and skills in 2025. It is noted that the Board already has experts with both legal and industry backgrounds. Corporate Responsibility in Hiring The Nomination & Governance Committee and Board are proud of the progress made to date on diversity within the Group, including achieving the UK Listing Rules’ targets for 2024 of (i) more than 40% female representation on the Board through the entirety of 2024, with 43% female Board members, and (ii) a female holding a senior Board position, with Ms. Kerrigan serving as the Senior Independent Director during 2024 and through her resignation on January 24, 2025, and Ms. Stash now serving as the Senior Independent Director. The Group continued its efforts in gender balance in 2024. Evidencing this improvement, the FTSE Women Leaders Review 2024 indicated Diversified ranks in 57th place among the FTSE 250. It also recognized 43% female representation at Board level and 39% in the executive committee and direct reports category (which is comprised of 36 females and 56 males). Within the energy sector, the Group is in 3rd place. The FTSE Women Leaders Review is an independent framework supported by the Government that builds on the excellent work of both the Hampton-Alexander and Davies Reviews which ensures that talented women at the top of business are recognized, promoted and rewarded. The Nomination & Governance Committee also acknowledges the UK Listing Rule ethnic diversity targets, which the Group intends to continue to closely examine and evaluate in 2025 in terms of Board membership, additions, recruitment and retention. The Group believes that a diverse and engaged workforce and Board is an important goal. In particular, the Group continues to focus on support for and communication with all groups in the communities in which it operates. It is the Nomination & Governance Committee’s hope that these efforts will increase interest in our industry and assist in the continued development of qualified candidates. 52 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Board Performance Review The Nomination & Governance Committee assisted the Chair with the Board Performance Review. The Board Performance Review focused on the following topics, among other things: • Strategy development and implementation; • Risk awareness, monitoring and reporting; • Cooperation with and evaluation process of the CEO and Senior Leadership Team; • Board composition and dynamics; • Onboarding and induction program; • Meeting structure and operation; • Meeting effectiveness; • Shareholder and stakeholder relations; • Committee, Senior Independent Director and Vice Chairman value contribution; and • Individual evaluation of the Chairman and all Board members. The Board Performance Review utilized an online questionnaire and thorough analysis of questionnaire results. The evaluation, analysis and reporting took place from September to November 2024 and confirmed that the Board and its Directors effectively perform their respective roles. The review highlighted certain areas for improvement such as restructuring meeting agendas to enhancing strategic discussions. Kathryn Z. Klaber Chair of the Nomination & Governance Committee March 17, 2025 The Audit & Risk Committee’s Report Committee Composition • David J. Turner, Jr., Chair • Sandra M. Stash • Kathryn Z. Klaber This report covers the activities of the Audit & Risk Committee in 2024 and in the period up to the approval of the Annual Report for the year ended December 31, 2024. Key Objective The Audit & Risk Committee acts on behalf of the Board and the shareholders to ensure the integrity of the Group’s financial reporting. The Audit & Risk Committee’s main functions include, among other things, reviewing and monitoring internal financial control systems and risk management systems on which the Group is reliant, reviewing annual and interim accounts and auditors’ reports; making recommendations to the Board in relation to the appointment and remuneration of the Group’s external auditors; and monitoring and reviewing annually the external auditors’ independence, objectivity, effectiveness and qualifications. Key Matters Discussed by the Committee During the past year the Audit & Risk Committee: • Reviewed and challenged interim and annual financial reporting; • Reviewed and approved the Group’s Hedging Policy; • Reviewed the Group’s system of internal controls and assessed its effectiveness; • Continued to engage with management on the post-U.S. listing integration of the applicable NYSE Rules and SEC Rules into the Group’s framework; • Reviewed and assessed the Group’s approach to its asset retirement obligations and overall liquidity; • Reviewed and updated the Audit & Risk Committee’s Terms of Reference to reflect best practices; • Reviewed the Enterprise Risk Management control strategy and function; • Reviewed the Group’s procedures for detecting fraud, prevention of bribery, and anti-money laundering systems and controls; • Reviewed the adequacy and security of processes for employees and contractors to raise concerns confidentially about possible wrongdoing in financial reporting or other matters; • Engaged with management regarding internal investigations and compliance reviews; • Continued to engage with Joyce Collins, Vice President of Internal Audit, to further enhance the Group’s internal audit function and consult with Ms. Collins during private executive sessions; • Approved the external audit plan presented by PwC, reviewed the effectiveness of the external audit and held independent discussions with the lead audit partner as well as private confirmatory meetings with members of the PwC audit team; • Implemented a formal written policy for non-audit services to preserve independence and objectivity of the external auditor in performing statutory audits; • Reviewed correspondence with the Financial Reporting Council (the “FRC”) related to financial reporting; and 53 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Enhanced our internal control procedures and financial reporting mechanisms to assist the Group’s ability to achieve compliance with Sarbanes- Oxley Act. Independence The Audit & Risk Committee regards independence of the external auditor as crucial in safeguarding the integrity of the audit process and takes responsibility for ensuring an effective three-way relationship between the committee, the external auditor and management. The Audit & Risk Committee confirmed that the external auditors, PwC, remain independent and that non-audit fees remain appropriate and reasonable. Committee Effectiveness The Audit & Risk Committee completed a critical review of its operations and effectiveness during 2024 as part of its annual self-review process. No significant areas of concern were raised. Areas of Focus in 2025 • Review the Group’s procedures in relation to maintaining high standards across all ethics and compliance matters; and • Ensure that all risks are appropriately identified, prioritized, addressed, and are managed by the respective risk owner. Membership In line with the recommendations set by the UK Corporate Governance Code, the Audit & Risk Committee is comprised of three Independent Non- Executive Directors members: David J. Turner, Jr., the Audit & Risk Committee Chair and Financial Expert, Sandra M. Stash and Kathryn Z. Klaber. Benjamin Sullivan, Senior Executive Vice President, Chief Legal & Risk Officer and Corporate Secretary acts as Secretary to the Audit & Risk Committee. The Audit & Risk Committee has recent and relevant financial experience through the leadership of Mr. Turner, who is presently the Chief Financial Officer at Regions Financial Corporation, a publicly traded U.S. bank that is a member of the S&P 500 Index. Each Audit & Risk Committee member has been selected to provide a wide range of financial and commercial expertise necessary to fulfil the committee’s responsibilities. No members of the Audit & Risk Committee have outside connections with the Group’s external auditors. Meetings and Attendance The Audit & Risk Committee met five times in 2024 and has met twice thus far in 2025. Before each meeting, the Audit & Risk Committee Chair met with the members of the finance team to ensure there was a shared understanding of the key issues to be discussed. Audit & Risk Committee meetings are held in advance of Board meetings to facilitate an effective and timely reporting process. The Audit & Risk Committee Chair provided a report to the Board following each meeting. For Audit & Risk Committee meeting attendance for each Director see the Directors’ Report within this Annual Report. The Audit & Risk Committee regularly meets in private executive sessions without management present, one with the Vice President of Internal Audit and one with committee members only, to ensure that points of common concern are identified and that priorities for future attention by the committee are agreed upon. It also conducts private discussions with PwC as appropriate to ensure that the Audit & Risk Committee has a clear and unobstructed line of communication with its external auditors. The Chair of the Audit & Risk Committee keeps in close contact with the Chief Legal & Risk Officer, the Vice President of Internal Audit, the President and Chief Financial Officer, Corporate Controller, the finance team and the external auditors between committee meetings. The list below details the members of the Senior Leadership Team who were invited to attend meetings as appropriate during the calendar year. In addition, PwC attended certain of the meetings by invitation as auditors to the Group. • Rusty Hutson, Jr. (Chief Executive Officer) • Bradley G. Gray (President and Chief Financial Officer) • Benjamin Sullivan (Senior Executive Vice President, Chief Legal & Risk Officer, and Corporate Secretary) • Michael Garrett (Senior Vice President of Accounting and Corporate Controller) • Joyce Collins (Vice President of Internal Audit) • Representatives from PwC UK and PwC U.S. Responsibilities and Terms of Reference The main responsibilities of the Audit & Risk Committee are: • Reviewing accounting policies and the integrity and content of the financial statements, including focusing on significant judgments and estimates used in the accounts; • Monitoring disclosure controls and procedures and the adequacy and effectiveness of the Group’s internal financial controls and risk management systems; • Oversee and advise the Board on various risk strategies, including cybersecurity, operational, and reputational risks; • Monitoring the integrity of the financial statements of the Group to assist the Board in ensuring that the Annual Report, when taken as a whole, are fair, balanced and understandable; • Considering the adequacy and scope of external audits and overseeing the relationship with the external auditors, including appraising the effectiveness of their work prior to considering their reappointment and considering whether to put the external audit contract out to tender; • Reviewing and approving the statements to be included in annual reports on internal control and risk management; and • Reviewing and reporting on the significant issues considered in relation to the financial statements and how they are addressed. In 2024, the Board undertook a formal assessment of the Group’s primary financial service vendors, including its external auditors’, PwC, independence and will continue to do so as part of the annual audit process and prior to making a recommendation to the Board for the auditors’ re-appointment. This assessment in 2024 included: • Reviewing PwC’s non-audit services provided to the Group, including Audit Related Assurance Services provided and the related fees; • Reviewing PwC’s procedures for ensuring the independence of the audit firm, and parties and staff involved in the audit; and 54 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Obtaining confirmation from the auditors that, in their professional judgment, they are independent. The Audit & Risk Committee has formal terms of reference which can be viewed on the Group’s website. Actions Undertaken During the Year The key activities for the Audit & Risk Committee for the period under review are set out below. Review of the Financial Statements The Audit & Risk Committee monitored the integrity of the annual financial statements and reviewed the significant financial reporting matters and accounting policies and disclosures in the financial reports. The external auditors attended an Audit & Risk Committee meeting as part of the full-year accounts approval process. The process included the consideration of reports from the external auditors in respect of the audit approach, and their findings in respect of the audit of the 2024 financial statements. Financial Statements & Presentation of Results The Audit & Risk Committee reviewed the presentation of the Group’s audited results for the year ended December 31, 2024 and the unaudited results for the six months ended June 30, 2024 to ensure they were fair, balanced and understandable, when taken as a whole. The results were assessed to ensure they provide sufficient information for shareholders and other users of the accounts to assess the Group’s position and performance, business model and strategy. In conducting this review, particular focus was given to the disclosures included in the basis of preparation in Note 2 in the Notes to the Group Financial Statements in relation to the Group’s funding position and the suitability of the going concern assumption. The Audit & Risk Committee reviewed the significant judgments associated with the 2024 financial statements, including “key audit matters”, and also reviewed the supporting evidence for the Group’s going concern assessment. The Board is required to provide its opinion on whether it considers that the Group’s 2024 Annual Report, taken as a whole, is fair, balanced and understandable, and provide the information necessary for shareholders to assess the Group’s position and performance, business model and strategy. The Audit & Risk Committee discussed the preparation of the Group’s 2024 Annual Report with the Board. To support the Board in providing its opinion, the Audit & Risk Committee considered the content and overall cohesion and clarity of the Annual Report and assessed the quality of reporting through discussion with management and the external auditors. This included ensuring that feedback from stakeholders and other individuals had been addressed and that examples of best practice had carefully been considered in the context of the Group. The process included considering each of the elements (fair, balanced and understandable) on an individual basis to ensure the Group’s reporting was comprehensive in a clear and consistent way, and in compliance with accounting standards and regulatory and legal requirements and guidelines. The reviews carried out by internal functions within the Group and independent reviewers were undertaken with a view to ensuring that all material matters have been correctly reflected in the Group’s 2024 Annual Report. In summary, the Audit & Risk Committee is comfortable that the overall disclosures in the 2024 Annual Report are fair, balanced and understandable, when taken as a whole. Attention continues to be paid to the presentation of the results and financial position in the Annual Report as well as APMs as indicators of performance. The Board considers current treatment, which retains reference to “adjusted EBITDA” and “EBITDA” to remain appropriate. The Board regards these measures as an appropriate way to present the underlying performance and development of the business since it reflects the continuing investment being made by the Group, particularly in relation to recent and future acquisition activity. Additionally, this is how the Board monitors the progress of the existing Group businesses. Accordingly, the Audit & Risk Committee believes that adjusted EBITDA provides useful information to investors and the market generally in understanding and evaluating the Group’s performance. Valuation of Natural Gas & Oil Properties & Related Assets The Audit & Risk Committee considered the carrying value of the Group’s assets and any potential impairment triggers. It reviewed management’s recommendations, which were also reviewed by the external auditors, including an evaluation of the appropriateness of the identification of cash- generating units. The Audit & Risk Committee was satisfied with the assumptions and judgments applied by management as well as the triggering event assessment, which concluded that no impairment triggers were present. Accordingly, there were no impairment charges recorded for the year ended December 31, 2024. Refer to Note 10 in the Notes to the Group Financial Statements. The Audit & Risk Committee also considered management’s determination of the fair values of the acquisitions made during 2024 and challenged management on such determination. It reviewed management’s assumptions and judgements, which were also reviewed by the external auditors. The Audit & Risk Committee was satisfied with the fair values calculated. Viability & Going Concern Management presented to the Audit & Risk Committee an assessment of the Group’s future cash flow forecasts and profit projections, available facilities, facility headroom, banking covenants and the results of its sensitivity analysis. Detailed discussions were held with management concerning the matters outlined in the Viability and Going Concern section and Note 2 in the Notes to the Group Financial Statements within this Annual Report. The Audit & Risk Committee discussed the assessment with management and was satisfied that the going concern basis of preparation, including the change in the viability period, continues to be appropriate for the Group and advised the Board accordingly. In addition, the Audit & Risk Committee reviewed the going concern assumptions with PwC, including PwC’s review of management’s assessment of the Group’s ability to continue as a going concern. The financial statements of Diversified Energy Company PLC have been prepared on a going concern basis. The Audit & Risk Committee reviewed and challenged management’s process and assessment of viability by considering various scenarios on forecasted cash flows, including a base case and downside scenario analysis which reflects the more severe impact of the principal risks and includes future climate change impacts. In reaching its view, the Audit & Risk Committee also considered: (i) financial forecasts and the appropriate period for the viability outlook; (ii) the Group’s financing facilities including covenant tests and future funding plans, and (iii) the external auditors’ findings and conclusions on this matter. The Audit & Risk Committee also considered the adequacy and accuracy of the disclosures in the 2024 Annual Report in respect of the Group’s future viability. Following this thorough assessment, the Audit & Risk Committee considered the extent of the assessment made by management to be appropriate and recommended the viability statement, including the change to the viability period, and related disclosures (for inclusion in the 2024 Annual Report) for approval by the Board. Risk Management Effective risk management and controls are key to executing the Group’s business strategy and objectives. Risk management and control processes are designed to identify, assess, mitigate and monitor significant risks, and can only provide reasonable and not absolute assurance that the Group will be 55 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance successful in delivering its objectives. The Board is responsible for the oversight of how the Group’s strategic, operational, cyber, financial, human and personnel, legal and regulatory risks are managed and for assessing the effectiveness of the risk management and internal control framework. Embedding the enterprise risk management framework and assessing management’s response to the Group’s material risks continues to be an area of focus with the Audit & Risk Committee providing challenge and direction as appropriate. During 2024, the Audit & Risk Committee continued to consider the process for identifying and managing risk within the business and assisted the Board in relation to compliance with the UK Corporate Governance Code and FRC guidance. Recognizing the evolving nature of the risk landscape, due to the increasing pace of change in the industry, the continued impact of the macroeconomic environment and global instability, more than ever, the Group needs to manage risks smartly to achieve its vision, deliver strategy and create sustainable shareholder value. The Group maintains a risk management program to identify principal risks and risk mitigation activities that includes reviewing the impact, likelihood, velocity, mitigation measures and residual risk. A description of the Group’s risk management program, principal risks, and risk mitigation activities is provided in Principal Risks and Uncertainties within this Annual Report. In addition to the risks that management identifies through the ongoing processes of reporting and performance analysis, the Audit & Risk Committee has additional risk identification processes, which include: • A risk and control process for identifying, evaluating and managing major business risks; • External experts, who comment on controls to manage identified risks; and • A confidential and externally managed whistleblowing hotline and a compliance reporting website for employees to contact the Chair of the Audit & Risk Committee, Chief Legal & Risk Officer and Head of Human Resources in confidence. Internal Audit The work performed by the Internal Audit team in 2024 and the results of testing the risk framework continue to support a favorable outcome on the adequacy and effectiveness of the Group’s internal controls. The Internal Audit team leveraged both audit work previously completed and knowledge of the Group to arrive at that conclusion. Internal testing was performed (and continues to take place) on the key controls identified throughout the business processes that impact the financial statements. There was additional focus around the completeness and accuracy element of support, updating process documentation, and completing walkthroughs of the processes with the Group’s external auditors. At each Audit & Risk Committee meeting, an update on Internal Audit is provided covering an overview of the work undertaken in the period, actions arising from audits conducted, the tracking of remedial actions, and progress against the internal audit plan. The team continues to be led by the Vice President of Internal Audit who has significant prior experience in leading natural gas and oil industry internal audits and has a straight line of communication available with the Audit & Risk Committee. The team also consists of a highly experienced audit manager as well as three additional staff auditors, all of whom have years of industry experience. Collectively, this team works under the oversight of the Corporate Controller and reports to the Chief Financial Officer who is responsible for the Group’s ERM and internal controls framework. The Group’s internal controls over financial reporting and the preparation of consolidated financial information include policies and procedures that provide reasonable assurance that transactions have been recorded and presented accurately. Management regularly conducts reviews of the internal controls in place in order to provide a sufficient level of assurance over the reliability of the financial statements. Internal Control Systems The Audit & Risk Committee is responsible for overseeing management’s establishment and maintenance of the Group’s system of internal control and reviewing its effectiveness. Internal control systems are designed to meet the particular needs of the Group and the particular risks to which it is exposed. The Board has reviewed the Group’s risk management and control systems noting they were in place for the year under review and up to the date of approval of the 2024 Annual Report and believes that the controls are satisfactory, given the nature and size of the Group. The internal controls, which provide assurance to the Audit & Risk Committee of effective and efficient operations, internal financial controls and compliance with laws and regulations include: • A formal authorization process for investments; • An organizational structure where authorities and responsibilities for financial management and the maintenance of financial controls are clearly defined; • Anti-bribery and corruption policies and procedures and a dedicated telephone number and website designed to address the specific areas of corruption risk faced by the Group; and • A comprehensive financial review cycle where annual budgets are formally approved by the Board and monthly variances are reviewed against detailed financial and operating plans. The Audit & Risk Committee considered the inherent risk of management override of internal controls as defined by Auditing Standards and performed the following actions during 2024: • Reviewed management’s report on the Group’s fraud prevention framework and the key controls in place in its operations designed to prevent and detect fraud, as well as future plans for enhancement of the relevant controls; • Identified the Group’s population of application fraud controls within the financial processes and conducted testing around those specific items to assure the Group’s risk control framework is whole and controls are working as anticipated to provide further confidence in the strength of fraud prevention; • Reviewed and assessed cybersecurity risk trends and other related matters with the Group’s Chief Information Technology Officer; • Discussed the steps management had taken, including designing a fraud detection process for the specific fraud risks identified; • Financial processes identified with critical fraud risk potential were reviewed at an elevated level and controls adjusted accordingly per discussion with management; • Assessed the measures in place, including segregation of duties ensuring independent review, to mitigate against the risk of management override of controls; 56 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Discussed PwC’s audit procedures, including the results of their conclusions relating to the fraud risk in revenue recognition with a particular focus on ensuring the existence of revenue transactions; • Challenged management on the robustness of the controls; and • Reviewed the overall robustness of the control environment, including consideration of the Group’s whistleblowing and compliance arrangements (including with respect to compliance with the Sarbanes-Oxley Act). The Audit & Risk Committee agreed with management’s assessment that the overall control framework remained effective and, with a focus on high-risk and material areas, additional controls introduced had mitigated risk. Safeguards & Effectiveness of the External Auditors The Audit & Risk Committee is responsible for oversight and for managing the relationship with our external auditors. The Audit & Risk Committee recognizes the importance of safeguarding the independence and objectivity of the external auditors. The following safeguards are in place to ensure that the independence of the auditors is not compromised. • The Audit & Risk Committee has a formal written policy on the provision of non-audit services by external auditors. • The Audit & Risk Committee carries out an annual review of the external auditors regarding their independence from the Group and that they are adequately resourced and technically capable to deliver an objective audit to shareholders. Based on this review, the Audit & Risk Committee recommends to the Board the continuation, or removal and replacement, of the external auditors; • The external auditors may only provide non-audit services permitted by the FRC’s Revised Ethical Standard 2019 (the “Ethical Standard”) which was issued in December 2019. These services include audit-related services such as regulatory and statutory reporting as well as other items relating to shareholder and other circulars; • The Audit & Risk Committee reviews all fees paid for audit and audit-related services on a regular basis to assess the reasonableness of fees, value of delivery and any independence issues that may have arisen or may potentially arise in the future; • The external auditors report to the Directors and the Audit & Risk Committee regarding their independence in accordance with relevant standards; • Non-audit services carried out by the external auditors are limited to work that is closely related to the annual audit or where the work is of such a nature that a detailed understanding of the business is beneficial, and utilizes subject matter experts not conducting audit services; • The Audit & Risk Committee monitors costs for non-audit services in absolute terms and in the context of the audit fee for the year to ensure that the potential to affect the independence and objectivity of the auditors does not arise. During 2024, non-audit services included work around the Group’s half-year review and acquisitions which did not affect the independence and objectivity of the auditors; and • Information related to audit fees for 2024 is detailed in Note 7 in the Notes to the Group Financial Statements. This is the external auditor’s fifth year as the Group’s external auditor following a formal tender process during 2020 and subsequent appointment at the 2020 AGM. The Audit & Risk Committee confirms that the Group has complied with the requirements of the Statutory Audit Services for Large Companies Market Investigation (Mandatory Use of Competitive Tender Processes and Audit Committee Responsibilities) Order 2014 for the financial year under review. The Audit & Risk Committee is cognizant of the fact that assessing external audit quality is a key responsibility within its remit which stakeholders look to the committee to discharge. The Audit & Risk Committee continually monitors the effectiveness of the external audit. To comply with this requirement, the Audit & Risk Committee reviewed and commented on PwC’s detailed audit plans and strategy, including the intended scope of the audit, identification of significant and elevated audit risks, the level of materiality proposed and the principles of PwC’s centrally directed audit approach. Many elements of the audit plan approach remained consistent with the 2023 audit, and the Audit & Risk Committee welcomed the plan to enhance the focus on utilizing data‑enabled auditing approaches to maximize efficiencies and insight from the auditors’ testing. Following discussion and challenge, the Audit & Risk Committee agreed on the methodology adopted for determining materiality and the scope of the audit. It then considered progress during the year by assessing the major findings of its work, the perceptiveness of observations, the implementation of recommendations and the management of feedback. At the request of the Board, the Audit & Risk Committee also monitors the integrity of the financial information in the Annual Report, half-year results statements, and the significant financial reporting judgments contained in them. Further details of the Audit & Risk Committee’s procedures to review the effectiveness of the Group’s systems of internal control during the year can be found in the section on effective risk management and internal control above. The Audit & Risk Committee recognizes that all financial statements include estimates and judgments by management. The key audit areas are agreed upon with management and the external auditors as part of the year-end audit planning process. This includes an assessment by management of the significant areas requiring management judgment and the Audit & Risk Committee challenging management’s judgments. These areas are reviewed with the auditors to ensure that appropriate levels of audit work are completed, and the Audit & Risk Committee reviews the results of this work. The numerous interactions with the auditor provided the Audit & Risk Committee with an insight into the quality of the audit process and the audit leadership team, and with the opportunity to assess the auditor’s challenge of management’s views. Assurance Measures On behalf of the Board, the Audit & Risk Committee examines the effectiveness of: • The systems of internal control, primarily through reviews of the financial controls for financial reporting of the annual, preliminary and half-yearly financial statements; • The management of risk by reviewing evidence of risk assessment and management; and • Any action taken to manage critical risks or to remedy any control failings or weaknesses identified, ensuring these are managed through to closure. Where appropriate, the Audit & Risk Committee ensures that necessary actions have or are being taken to remedy or mitigate significant failings or weaknesses identified during the year either from internal review or from recommendations raised by the external auditors. In 2024, the Audit & Risk Committee did not identify any significant failings or weaknesses in the system of risk management and internal control. The Group’s internal controls over the financial reporting and consolidation processes are designed under the supervision of the Group’s President and Chief Financial Officer to 57 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance provide reasonable assurance regarding the reliability of financial reporting and the preparation and fair presentation of the Group’s published financial statements for external reporting purposes, in accordance with UK-adopted International Accounting Standards and International Financial Reporting Standards as issued by the International Accounting Standards Board. Because of its inherent limitations, internal control over financial reporting cannot provide absolute assurance and may not prevent or detect all misstatements whether caused by error or fraud. The Group’s internal controls over financial reporting and the preparation of consolidated financial information include policies and procedures that provide reasonable assurance that transactions have been recorded and presented accurately. Management regularly conducts reviews of the internal controls in place in respect of the processes of preparing consolidated financial information and financial reporting. During the year, there has been a significant investment in resources, processes and personnel relating to the internal controls of these processes to reflect the growth of the Group. This is in order to provide a sufficient level of assurance over the reliability of the financial statements. Summary For the year under review, and beyond, the Audit & Risk Committee will continue its monitoring of financial reporting and of internal controls and risk management, as these evolve in response to the Group’s continuing growth and new opportunities as they arise. David J. Turner, Jr. Chair of the Audit & Risk Committee March 17, 2025 The Remuneration Committee’s Report Committee Composition • Sylvia Kerrigan, Chair (for the entirety of 2024 through January 24, 2025) • David J. Turner, Jr., Chair (appointed on January 24, 2025) • David E. Johnson • Sandra M. Stash Letter from Chair of the Remuneration Committee We are pleased to present our 2024 Directors’ Remuneration Report on behalf of the Board. Included within this report is the Annual Report on Remuneration, which sets out payments and awards made to the Directors for the year ended 2024, and the proposed new Directors’ Remuneration Policy, which, if approved at the Group’s 2025 Annual General Meeting (“AGM”), will operate for the year ended December 31, 2025 , and the subsequent years until the AGM in 2028. The Director’s Remuneration Report will be presented to shareholders for approval at the 2025 AGM. Key Objective The Remuneration Committee oversees the remuneration program of Executive Directors and the Senior Leadership Team (“Executives”) on behalf of the Board. The Remuneration Committee is focused on ensuring that remuneration is designed to emphasize "pay for performance” by: • Providing performance-driven remuneration opportunities that attract, retain and motivate executives to achieve optimal results for the Group and its shareholders; • Aligning remuneration with the Group’s short- and long-term business objectives while providing sufficient flexibility to address the unique dynamics of the Group’s business model; and • Emphasizing the use of equity-based remuneration to motivate the long-term retention of the Group’s executives and align their interests with those of shareholders. As an executive's seniority increases, and the scope, duties and responsibilities of the executive's position expand, the Remuneration Committee believes a greater portion of total remuneration should be performance driven and earned over a longer time horizon. Fixed remuneration should therefore be a relatively smaller portion of senior executive total remuneration with the majority of an executive’s realized remuneration linked to the performance of the Group and delivered in shares. DEC’s Performance in 2024 2024 was a year of continued execution and transition. The Group brought a focused execution on increased cash flow generation, capital discipline, and balance sheet management. The year also marked a transition as the Group closed the Oaktree, Crescent Pass and East Texas II acquisitions, which continued the Group’s expansion in the Central Region upstream and midstream assets, expanded access to U.S. investors and improved trading liquidity with dual listing on the LSE and NYSE, and completed its eighth and ninth asset-backed securitizations that further enhanced the Group’s liquidity. Through its continual, daily focus on SAM and its zero tolerance policy for fugitive emissions, the Group made significant progress in its emissions reduction goals, including through its handheld and aerial leak detection and repair programs and methane-driven pneumatic device co nversions to compressed air. Further, the Group expanded asset retirement operations, deploying 18 rigs across Appalachia to retire a combined 287 wells – including 85 third-party owned wells and 202 Diversified-owned wells. The Group’s formal Community Giving and Engagement Program also made meaningful contributions to surrounding communities, with more than $2 million contributed to various charitable, educational, student and youth athletic, and community and stakeholder engagement and outreach groups, and community organizations, including to food pantries, arts and educational programs, health and wellness organizations, and municipal services. These achievements combined with the year’s equity performance has impacted the performance-related pay outcomes for the Executive team. With respect to the 2024 annual bonus, as reported elsewhere in this Annual Report, DEC’s adjusted EBITDA for 2024 was $472 million. This equated to adjusted EBITDA per diluted share of $10.79, after making certain adjustments for acquisitions and share dilution as described in Annual Bonus for 58 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Executive Directors within this Annual Report. The threshold, target and stretch metric was $8.00, $8.21 and $8.42 per share, respectively. Metrics were established using the 2024 budget, with the stretch metric achievable from over-performing in production, management of costs, and/or executing on acquisitions. Due to adjusted EBITDA per share being above maximum performance target levels the Remuneration Committee awarded 50% for this metric out of a potential 50%. Under the cash cost metric the Group achieved $1.35 per Mcfe, which is similar to the Group’s KPI for adjusted operating cost per Mcfe, yet excludes certain adjustments for acquisitions and production taxes. The threshold, target and stretch metric was $1.35, $1.30 and $1.27 per Mcfe, respectively. As such, the Remuneration Committee awarded 5% for this metric out of a potential 20%. In relation to the non-financial elements which account for the remainder of the annual award, the Executive Director (CEO) was determined to have performed towards the top end of the objectives (30% of potential 30%). The Group’s overall performance resulted in awards of 148.8% of salary out of a maximum of 175% of salary being awarded to the CEO under the annual bonus plan. The 2024 financial year was the end of the three-year performance period for the Performance Share Award granted in 2022. The performance conditions are a mix of Return on Equity (“ROE”) (40%), Absolute TSR (30%), Relative TSR (10%), and Methane Intensity Reduction ( 20%) targets measured over three years. The overall payout for the award is 67% of maximum. The Remuneration Committee considers that the Remuneration Policy operated as intended during 2024 and that the remuneration outcomes described above reflect the overall performance by the Group. The Remuneration Committee determined that no discretion needed to be applied for the above remuneration outcomes. Key Matters Discussed by the Committee During the past year the Remuneration Committee: • Determined 2024 annual bonus outcomes for the Executive Director; • Determined base salary of the Executive Director for the period starting January 2024; • Reviewed the annual total remuneration of the Group’s executives; • Reviewed the Group’s Directors’ Remuneration Policy and consulted on proposed changes with the Group’s largest shareholders; • Reviewed the Group’s overall workforce remuneration and benefits plans, ensuring alignment of incentives and rewards with culture; • Reviewed and approving the 2025 Executive Director Bonus Plan and Performance Share Award targets; • Discussed the voting results of the 2024 AGM; • Determined that the remuneration policy for 2024 operated as intended; • Prepared the Directors’ Remuneration Report; and • Reviewed and updated the Remuneration Committee’s Terms of Reference to reflect best practices. Directors’ Remuneration Policy for 2025 Diversified is an energy company focused on solutions that optimize existing, long-life, and often undervalued U.S. energy assets. The Group’s unique modern field management philosophy leverages technology that integrates digital tools, scale, vertical integration, and human experience to responsibly manage mature existing assets, improve environmental performance, and unlock overlooked value. As the only public company executing this strategy, Diversified is differentiated by this focus that minimizes traditional exploration and production risks, delivers consistent free cash flow, and serves a fundamental role in U.S. energy markets. Ensuring that the Group has the right talent has enabled Diversified to deliver its strategic vision of building a portfolio of high-performing assets since the Group went public on the NYSE, and it has continued the track record of delivering on that vision with the closing of the Oaktree, the Crescent Pass, and East Texas acquisitions. The CEO recruited and developed this talent and is largely responsible for its success. The Group remains committed to a balanced capital allocations framework, with the diversity and strength of the asset base providing a solid foundation for accretive growth and value creation for our shareholders. The current policy was approved by shareholders in a binding vote at the 2022 AGM with just under 83% of votes cast in favor. This policy was traditionally aligned with the UK market and met the expectations of our shareholders when it was introduced. In preparation for the shareholder vote on a new Remuneration Policy at the 2025 AGM, the Remuneration Committee has engaged an independent subject matter expert to conduct a detailed review of the remuneration arrangements to ensure that they are appropriate in light of the performance of the business and our current strategy. Of particular focus for the Remuneration Committee was the need to ensure that going forward the policy is capable of delivering competitive compensation in the U.S., where all of Diversified’s executives, employees, and operations are based, whilst meeting the expectations of our UK investor base in terms of the design and structure of the arrangements and ensuring the interests of our shareholders and executives are aligned. The key conclusions of the review were that: • The current policy approved by the shareholders at the Group’s 2022 annual general shareholder meeting, whilst being traditionally aligned to the UK market, contains features not present in the U.S. market and is not well aligned with the U.S. in terms of quantum or structure, leading to concerns of the Remuneration Committee and the Group’s ability to replace and attract future Executive Directors as well as other members of the Group’s senior management team; • Current total direct compensation (base + on-target bonus + the expected value of LTIP) for the Executive Directors, specifically with respect to the CEO, is approximately 30% below the median of other North American gas producers of a similar size in terms of market capitalization; • Although almost all of our peers in the U.S. grant a mix of performance shares and restricted (i.e. service-based vesting) shares as part of the compensation for executives, our current policy does not offer restricted shares to the Executive Directors, which places the Group at a significant disadvantage, particularly should it need to recruit senior talent in the future; • The Group already grants a mix of performance shares and restricted shares to its employees and a move to include restricted shares in Executive Directors’ pay aligns with our existing internal reward structure ensuring consistency and alignment within our senior team; and 59 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • With Diversified’s unique U.S. focus and exposure to the U.S. market, there is a clear and compelling rationale to granting hybrid awards (i.e. a mix of performance and restricted shares), even though hybrid awards are a relatively new development for UK-listed companies (with the practice having been recently acknowledged by the Investment Association in its October 8, 2024, updated “Principles of Remuneration” as being an appropriate feature for consideration in certain circumstances). Shareholder consultation regarding proposed changes to remuneration The policy proposals were developed and consulted upon with a significant number of the Group’s largest shareholders and proxy advisors (the majority of whom were supportive). The Remuneration Committee would like to thank those who provided constructive feedback, which enabled it to re-assess and, in certain parts, reduce its proposals (including, in particular, the proposed restricted share award level) and make changes in response to that feedback where appropriate. Importantly, it should be noted that with the adoption of the proposed remuneration policy for 2025, the CEO’s total direct compensation in 2025 when all changes are implemented will be still positioned slightly below the median level of U.S. peers. See Part A: Directors’ Remuneration Policy for a list of the main changes from the previous policy. Summary of Main Changes to the Directors’ Remuneration Policy Annual Bonus - The maximum annual bonus opportunity of the CEO would increase from 175% to 200% of salary. For Executive Directors who have not yet achieved the required shareholding, 50% will be deferred as either shares or cash for two years provided continued service. Current Executive Directors who have met their shareholding guidelines will not be required to defer any of annual bonuses. Long-Term Incentive (“LTI”) The policy maximum for performance share awards would remain unchanged at 325% of salary for the CEO and a new restricted share award of 100% of salary will be introduced. Other non-CEO Executive Directors would be eligible for performance awards of up to 250% of salary and 75% of salary in restricted shares. Both the performance and restricted share awards will be subject to three-year performance and vesting period, and a two-year post-vesting holding period, resulting in a total five-year period from grant until rewards are realized. The restricted share awards will vest on a cliff-basis at the end of the three-year vesting period. Consistent with the UK Corporate Governance Code and investor guidelines, the Remuneration Committee will have discretion to override vesting outcomes in certain circumstances where the Remuneration Committee determines that vesting is not warranted. The Remuneration Committee acknowledges that shareholders would often expect a reduction in award face value when replacing performance shares with restricted shares. However, in addition to structuring the compensation program to be retentive and give future flexibility for attracting senior talent, the Remuneration Committee is also seeking to address an approximate 30% shortfall in the level of CEO remuneration compared to a peer group of U.S. listed oil & gas producers comprising: Amplify Energy Corp; Berry Corporation; CNX Resources Corp; Granite Ridge Resources; Highpeak Energy; Mach Natural Resources; Northern Oil and Gas; Riley Exploration Permian; Ring Energy; TXO Partners; Vital Energy; and W&T Offshore. This peer group was chosen upon considerable review and with assistance from the Remuneration Committee’s independent compensation expert. The group was selected from a long list of natural gas and oil companies headquartered in the U.S. that focus on natural gas extraction with wells and systems. The results were further filtered by similarity of operational footprint to Diversified and which are similar in terms of median market capitalization and revenue. Taken together, the proposed changes would result in the remuneration of the CEO being positioned slightly below the median of the U.S. peers and with a market aligned mix between performance shares and restricted shares. The proposed award limits also take account of feedback from shareholders consulted on our initial thinking as to the most appropriate mix between performance and non-performance based awards, as shown in the charts below. The metrics on which the LTI performance share awards are based have not yet been finalized but will be fully disclosed to shareholders in advance of the 2025 AGM. The Remuneration Committee’s current thinking is that the metrics will be as follows: • ROE (40%), • Absolute TSR (20%), • Relative TSR vs a bespoke peer group of primarily U.S. gas producers (20%), and • Emissions Reduction (20%) Share Ownership Guidelines In order that Executive Directors’ interests are further linked with those of shareholders, the shareholding that Directors are expected to build up and maintain in the Group are being increased to align with the market. The Remuneration Committee proposed to increase the shareholding requirements to 600% for the CEO and 300% for other Executive Directors. Also, a two-year post cessation shareholding guideline will continue. Notations Regarding Other Elements of the Remuneration Policy 60 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance The Remuneration Committee believes the remainder of the Remuneration Policy remains largely fit for purpose and we only have proposed minor changes to the Remuneration Policy in line evolving market best practice. The CEO’s salary increase for 2025 is in-line with the average increase awarded to the workforce at 3.5%. Proposed changes to the Equity Incentive Plan Rules Under our current Equity Incentive Plan (“EIP”) that governs equity-based awards, we are subject to two restrictions on dilution: a hard cap of 3,284,031 shares and, in alignment with UK best practices, a cap allocated under the plan over any ten-year period amounting to 10% of our issued share capital (equivalent to 5,979,594 shares as of February 28, 2025). The Remuneration Committee proposes to streamline these limits by removing the hard cap of 3,284,031 shares while and retaining the cap of 10% over ten years, in accordance with UK best practice. Additionally, shares held by the Employee Benefit Trust (the “EBT”) will occasionally be utilized to cover vested equity-based awards. The EBT will also periodically purchase shares in the open market. Consistent with best practices, shares purchased in the market issued by the EBT will not count towards the 10% cap because they are not dilutive to the share value. Format of the Report and Matters to be Approved at our Annual General Meeting At the 2025 AGM, shareholders will be asked to approve three resolutions related to Directors’ remuneration matters: • To approve the Directors’ Remuneration Policy as set out in Part A of this Directors’ Remuneration Report; • To approve the Directors' Remuneration Report other than Part A; and • To approve changes to the EIP dilution limits as outlined above. Our approach to executive pay is designed to address the challenge of balancing a U.S. based management team with the expectations of a UK and U.S. listed company. We hope that our shareholders will remain supportive of the approach and that you will vote in favor of the remuneration resolution at the 2025 AGM. David J. Turner, Jr. David E. Johnson Sandra M. Stash Chair of the Remuneration Committee Chair of the Board and Member of the Remuneration Committee Member of the Remuneration Committee March 17, 2025 March 17, 2025 March 17, 2025 Membership The Remuneration Committee is currently comprised of the Non-Executive Chairman and two Independent Non-Executive Directors: David J. Turner, Jr., the Remuneration Committee Chair, Sandra M. Stash, the Senior Independent Director as of January 24, 2025, and David E. Johnson. Sylvia Kerrigan served as Remuneration Committee Chair for the entirety of 2024 and resigned effective January 24, 2025. Benjamin Sullivan, Senior Executive Vice President, Chief Legal & Risk Officer and Corporate Secretary acts as Secretary to the Remuneration Committee. Meetings and Attendance The Remuneration Committee met formally three times during the year and has met twice thus far in 2025. The Remuneration Committee regularly meets in private executive session at the end of its committee meetings, without management present to ensure that points of common concern are identified and that priorities for future attention by the committee are agreed upon. The Chair of the Remuneration Committee keeps in close contact with the Chief Legal & Risk Officer and Human Resources team between committee meetings. For Remuneration Committee meeting attendance for each Director see the Directors’ Report within this Annual Report. Committee Effectiveness The Remuneration Committee performed a critical analysis internal review and evaluation on itself, as part of its annual self-review process. No significant areas of concern were raised. Responsibilities and Terms of Reference A key objective of the Remuneration Committee is to help attract, retain and motivate talented executives by ensuring competitive remuneration and motivating incentives. The incentives are linked to the overall performance of the Group and, in turn, to the interests of all shareholders. The Remuneration Committee is responsible for: • Discussing and determining the Group’s framework for executive remuneration; • Determining the remuneration for the Executive Director; • Reviewing remuneration for other members of the Senior Leadership Team; • Reviewing and recommending to the Board the remuneration of the Non-Executive Directors; and • Overseeing and reviewing the structure and operation of the remuneration policy. The Remuneration Committee has formal terms of reference which can be viewed on the Group’s website at www.div.energy. Role of Management The Group’s Human Resources Department assists the Remuneration Committee and its independent compensation consultant (as applicable) in gathering the information needed for their respective reviews of the Group’s compensation program with respect to the Senior Leadership Team. This assistance includes assembling requested compensation data. The CEO develops pay recommendations for members of the Senior Leadership Team for review and discussion by the Remuneration Committee. The Remuneration Committee, in private session and without executive officers present, approves the CEO’s pay levels. 61 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance External Advisors During the year, FIT Remuneration Consultants LLP (“FIT”) and Mercer Limited (“Mercer”) provided assistance to the Remuneration Committee. Both FIT and Mercer are signatories to the Remuneration Consultants Group’s Code of Conduct. FIT provided advice to the Remuneration Committee on all matters relating to remuneration, including best practice. Mercer provided specialist advice to support the review of the proposed Director’s Remuneration Policy and shareholder engagement. FIT provided no other services to the Group or its Directors and do not have any other connection with the Group or its Directors. Mercer provides pay benchmarking and survey data to the Group’s management but otherwise does not have any other connection with the Group or its Directors. Accordingly, the Remuneration Committee was satisfied that the advice provided by FIT and Mercer was objective and independent. The Remuneration Committee selected and appointed FIT based on the positive experience with FIT in prior years, among other factors. Mercer was appointed to advise both the Group and the Remuneration Committee on development of the new Remuneration Policy, based on the Group’s experience of working with its lead advisor on the development of the previous Remuneration Policy. FIT’s and Mercer’s fees in respect of 2024 were $37,507 (GBP: £29,302), and $126,080 (GBP: £98,500), respectively. Both FIT’s and Mercer’s fees are charged on the basis of time and materials. Remuneration at a Glance Proposed Remuneration Policy & Implementation Stated Objective Overview of Proposed Remuneration Policy Proposed Implementation for 2025 Base salary • Reviewed annually. • Consideration given to the performance of the Group, the individual’s performance, the individual responsibilities or scope of the role, and pay practices in relevant comparator companies in the U.S. Executive Director (Effective January 1, 2025 and represents a 3.5% increase for Rusty Hutson, Jr. over 2024 . This compares to increases across the Group ranging from 0% to 7% based on performance, with an average of 3.5%.) • CEO: Rusty Hutson, Jr.: $807,128 Pension & benefits • The current Executive Director does not receive a pension contribution and any future provision will be aligned to the wider workforce. • The current Executive Director does not receive a pension contribution. • Consistent with the approach taken for all employees, the Group offers a retirement plan in accordance with subsection 401(k) of the Internal Revenue Code in which the Executive Director may make voluntary pre-tax contributions towards his own retirement. The Group matches the Executive Director’s contributions up to $26 thousand per annum. • Benefits consist of standard car and health/insurance related benefits. Annual Bonus Short-Term Incentives • Maximum of 200% of salary for Rusty Hutson, Jr. and 125% of salary for other Executive Directors. • For Executive Directors who have not yet achieved the required shareholding, 50% will normally be paid in cash, with the remainder deferred as either shares or cash for two years provided continued service. • Deferral is not required for existing Executive Directors who, at the time this Remuneration Policy is approved, have achieved the required shareholding, i.e. 100% of their award will normally be paid in cash, with no deferral. • Subject to the achievement of relevant performance conditions, both qualitative and quantitative. • Subject to malus and clawback provisions. Potential awards for 2025 performance period: • Rusty Hutson, Jr.: 200% of salary • Other Executive Directors: 125% of salary • Performance conditions, which will have defined Threshold, Target, and Stretch payout criteria: • 50% adjusted EBITDA per share • 25% cash cost per Mcfe • 25% sustainability measures Long-Term Incentives • Performance Share Awards, subject to service and performance over a three-year period, and eligible for payment of applicable Dividend Equivalent Rights during the vesting period. Maximum award of 325% of salary for Rusty Hutson, Jr. and 250% of salary for other Executive Directors. • Restricted Share Awards, subject to service over a three-year period, and eligible for payment of applicable Dividend Equivalent Rights during the vesting period. Maximum award of 100% of salary for Rusty Hutson, Jr. and 75% of salary for other Executive Directors. • Subject to malus and clawback provisions. Potential awards for 2025 : • Rusty Hutson, Jr.: 325% of salary of performance share awards; 100% of salary of restricted share award • Other Executive Directors: 250% of salary of performance share awards; 75% of salary of restricted share awards • Performance conditions: • 40% return on equity • 20% relative TSR • 20% absolute TSR • 20% emissions Share Ownership Requirements • Rusty Hutson, Jr.: 600% of salary • Other Executive Directors: 300% of salary • Lower of shares acquired from LTIP awards held at termination or normal share ownership requirement continues to apply for first year following termination, reducing to 200% of salary for the second year. Rusty Hutson, Jr. meets the requirement. 62 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Introduction Part A: Represents the proposed policy which will take effect, subject to the approval of the shareholders, immediately after the 2025 AGM (the “Directors’ Remuneration Policy”). Part B: Constitutes the Annual Report on Remuneration sections of the Executive Directors’ Remuneration Report. Part A: Directors’ Remuneration Policy The Directors’ Remuneration Policy below sets out the information required by Part 4 of Schedule 8 to the Large and Medium-Sized Companies and Groups (Accounts and Reports) Regulations 2008 (as amended). If approved by Shareholders at the forthcoming AGM on April 9, 2025, the Directors’ Remuneration Policy set out below will replace the existing policy for which shareholder approval was obtained at the 2022 AGM, and will become binding immediately thereafter. The main changes from the previous policy are: • Annual Bonus maximum for the CEO is to be increased to 200% of salary and add an annual bonus maximum for other Executive Directors at 125% of salary with a deferral of 50% of any bonus earned compulsory to which existing Executive Directors who have met their shareholding requirement are not subject. No deferral will be applicable to any bonus for an existing Executive Director who has met their shareholding requirement; • Performance Share Awards maximum is to remain at 325% per annum for the CEO and a new Restricted Share Award of 100% of salary is introduced; and • New Performance Share Awards maximum for other Executive Directors at 250% per annum and Restricted Share Award of 75% of salary is introduced in order to future-proof the policy. The following table summarizes the Group’s policies in respect of the key elements of our Directors’ remuneration: Element and Purpose Remuneration Policy and Operation Maximum Performance Measures Base salary This is the core element of pay and reflects the individual’s role and position within the Group with some adjustment to reflect their capability and contribution. • Base salaries will typically be reviewed annually, with consideration given to the performance of the Group and the individual, any changes in responsibilities or scope of the role and pay practices in relevant U.S. comparator companies of a broadly similar size and complexity, with due account taken of both market capitalization and turnover. • The Remuneration Committee does not strictly follow benchmark pay data, but instead uses it as one of a number of reference points when considering, in its judgment, the appropriate level of salary. Base salary is paid monthly in cash. • It is anticipated that salary increases will generally be in line with those awarded to the general workforce. That said, in certain circumstances (including, but not limited to, changes in role and responsibilities, market levels, individual and Group performance), the Remuneration Committee may make larger salary increases to ensure they are market competitive. The rationale for any such increase will be disclosed in the relevant Annual Report. n/a Benefits To provide benefits valued by recipients. • The Executive Director currently receives standard car and health/ insurance related benefits. • Where appropriate, the Group will meet certain costs relating to Executive Director relocations. • In line with the approach taken for all employees, the Group offers a retirement plan in accordance with subsection 401(k) of the Internal Revenue Code in which the Executive Director may make voluntary pre-tax contributions towards his own retirement. The Group matches the Executive Director’s contributions up to $26 thousand per annum. • The Remuneration Committee reserves the discretion to introduce new benefits where it concludes that it is appropriate to do so, having regard to the particular circumstances and to market practice. • It is not possible to prescribe the likely change in the cost of insured benefits or the cost of some of the other reported benefits year to year. • Relocation expenses are subject to a maximum limit of 100% of base salary, provided that such expenses may be paid only in the year of appointment and for a further two financial years. • With limited exceptions, the U.S. Section 401(k) defined contribution plan currently provides company matching contributions up to a maximum of $26 thousand per annum. • The Remuneration Committee will monitor the costs of benefits in practice and will ensure that the overall costs do not increase by more than what the committee considers appropriate in all the circumstances. n/a 63 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Element and Purpose Remuneration Policy and Operation Maximum Performance Measures Pension To provide retirement benefits. • Currently, no element of the Directors’ remuneration is pensionable, and the Group does not operate any pension scheme or other scheme providing retirement or similar benefits. • The Remuneration Committee reserves the discretion to introduce new benefits where it concludes that it is appropriate to do so, having regard to the particular circumstances and to market practice. • The current Executive Director does not receive a pension contribution. • Any future pension provision will be limited to levels aligned to the contribution levels for the majority of the workforce. n/a Annual bonus plan To motivate the Executive Director and incentivize the delivery of performance over a one-year operating cycle, focusing on the short- to medium-term elements of our strategic aims. • Annual bonus plan levels and the appropriateness of measures are reviewed annually at the commencement of each financial year to ensure they continue to support our strategy. • Once set, performance measures and targets will generally remain unchanged for the year, except to reflect events such as corporate acquisitions or other major transactions where the Remuneration Committee considers it to be necessary in its opinion to make appropriate adjustments. • For Executive Directors who have not yet achieved the required shareholding, 50% will normally be paid in cash, with the remainder deferred as either shares or cash for two years provided continued service. • Deferral is not required for existing Executive Directors who at the time this Remuneration Policy is approved have achieved the required shareholding. • Clawback provisions apply to the annual bonus plan, and malus and clawback will apply to deferred shares in accordance with the Group’s clawback and malus policies. • The maximum level of annual bonus plan outcomes is 200% of base salary for the CEO and 125% of base salary for other Executive Directors. • The performance measures applied may be financial or non-financial; quantitative and qualitative; and corporate, divisional or individual and with such weightings as the Remuneration Committee considers appropriate. The metrics and weightings applicable for 2025 are intended to be as follows: • 50% adjusted EBITDA per share • 25% cash cost per Mcfe • 25% sustainability measures • Where a sliding scale of targets is used, attaining the threshold level of performance for any measure will not typically produce a payout of more than 25% of the maximum portion of the overall annual bonus attributable to that measure, with a sliding scale to full payout for maximum performance. • However, the annual bonus plan remains a discretionary arrangement and the Remuneration Committee retains a standard power to apply its discretion to adjust the outcome of the annual bonus plan for any performance measure (from zero to any cap), should it consider that to be appropriate. 64 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Element and Purpose Remuneration Policy and Operation Maximum Performance Measures Long-term incentives To motivate and incentivize the delivery of sustained performance over the long-term, and to promote alignment with shareholders’ interests, the Group grants Performance Share Awards. • Performance Share Awards vest over a period of three years, and are eligible for accrual of applicable Dividend Equivalent Rights during the vesting period. • Restricted Share Awards are subject to service over a three-year period, and are eligible for accrual of applicable Dividend Equivalent Rights during the vesting period. • Once vested the net of tax shares from both the Performance Share and Restricted Awards are subject to a holding period of two years. • Clawback and malus provisions apply to Performance Share Awards and Restricted Share Awards. • Performance Share Awards may be granted with a maximum value of 325% of salary for the CEO and 250% of salary for the other Executive Directors. • Restricted Share Awards may be granted with a maximum value of 100% of salary for the CEO and 75% of salary for other Executive Directors. • In determining the number of shares subject to an award, the market value of a share shall, unless the Remuneration Committee determines otherwise, be assumed to be the average share price for the five days following the announcement of the Group’s results for the previous financial year. • The Remuneration Committee may set such performance conditions on Performance Share Awards as it considers appropriate, whether financial or non-financial and whether corporate, divisional or individual. Performance periods may be over such periods as the Remuneration Committee selects at grant, which will not be less than, but may be longer than, three years. • It is intended that the metrics and weightings applicable in 2025 will be as follows: • 40% Return on Equity • 20% Absolute TSR • 20% Relative TSR • 20% Emissions • No more than 15% of awards vest for attaining the threshold level of performance conditions. The Remuneration Committee also has a standard power to apply its judgment to adjust the vesting outcome of Performance Share Awards and Restricted Share Awards to take account of any circumstances (including the performance of the Group, any individual or business) should it consider that to be appropriate. 65 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Element and Purpose Remuneration Policy and Operation Maximum Performance Measures Share ownership guidelines To further align the interests of the Executive Director with those of shareholders. • Each Executive Director is expected to build up a prescribed level of shareholding. • Minimum shareholding is 600% of base salary for the CEO and 300% of base salary for other Executive Officers. The Remuneration Committee reserves the power to amend, but not reduce, these levels in future years. • To the extent that the prescribed level has not been reached, the Executive Director will be expected to retain a proportion of the shares vesting under the Group’s share plans until the guideline is met. • Any vested shares from long-term incentives subject to a holding period and any shares awarded in connection with annual bonus deferral will be included for the purpose of the guidelines (discounted for anticipated tax liabilities). • A post-employment shareholding requirement normally applies to shares from long-term investments vesting after the effective date of the Directors’ Remuneration Policy for 2025. The policy requires the Executive Director to hold the shares equivalent to his share ownership guideline at that date, for a period of one year post- employment and reducing to 200% of salary for the second year post- employment. n/a n/a Chairman’s and Non-Executive Directors’ fees To enable the Group to recruit and retain a Chairman of the Board and Non- Executive Directors of the highest caliber. • The fees paid to the Chairman and Non-Executive Directors aim to be competitive with other U.S. and UK listed peers of equivalent size and complexity. • The fees payable are determined by the Board, and will include incremental committee Chair and additional responsibility fees (as applicable). Directors do not participate in decisions regarding their own fees. • Non-Executive Directors are reimbursed all necessary and reasonable expenses incurred in connection with the performance of their duties and any tax thereon in accordance with the Group’s Non- Executive Director Expense Reimbursement Policy. • No other benefits are envisaged for the Chairman and Non-Executive Directors, but the Group reserves the right to provide benefits, including company related travel and office support. • Fees are paid monthly in cash. • A proportion of each Non-Executive Directors’ fees may be required to be used for the acquisition of Group shares which must then be held until they cease to be a Director. • The aggregate fees and any benefits of the Chairman and Non-Executive Directors will not exceed the limit from time to time prescribed within the Group’s Articles of Association for such fees. • Any increases actually made will be appropriately disclosed. n/a Choice of Performance Metrics Diversified’s strategy is to focus on solutions that optimize existing, long-life, and often undervalued U.S. energy assets. This requires a unique modern field management philosophy that leverages digital tools, scale, vertical integration, and human experience to responsibly manage mature existing assets, improve environmental performance, and unlock overlooked value. This minimizes traditional exploration and production risks, delivers consistent free cash flow, and serves a fundamental role in U.S. energy markets. Targets are reviewed each year by the Remuneration Committee and set taking account of Diversified’s in-year and longer-term goals. 66 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance The proposed 2025 annual bonus metrics which comprise adjusted EBITDA per share ( 50%), cash cost per Mcfe (25%), and sustainability measures (25%) have been selected as these incentivize a disciplined and responsible approach to growth and delivery of returns to shareholders. The proposed scorecard of metrics selected for the grants of Performance Share Awards in 2025 comprises Return on Equity (40%), Absolute TSR (20% ), Relative TSR (20%), and Emissions ( 20%). These have been selected as they reward strong capital management, encourage value enhancing acquisitions, reward the generation of superior returns to shareholders across the cycle as well as a focus on sustainability. Service Contracts & Letters of Appointment The following table summarizes key dates for the service contracts of Rusty Hutson, Jr. effective as of December 31, 2024: Name Date of Service Contract Duration Rusty Hutson, Jr. January 30, 2017 Executive Director’s service agreement should be of indefinite duration, subject to termination by the Group or the individual on six months’ notice. The service agreements of all current Executive Directors comply with that policy. The contract of the current Executive Director, which is available for inspection at the Group’s registered office, contains a payment in lieu of notice clause which is limited to base salary only. In line with U.S. practice, depending on the circumstances of their severance from service, the Executive Director may be entitled to certain payments, including previously accrued salary plus 12 months salary. For each current Non-Executive Director, the effective date of their latest letter of appointment is: Name Date of Letter of Appointment Duration David E. Johnson February 3, 2017 Martin K. Thomas January 1, 2015 Initial period of 12 months, subject to re-election at each AGM of the Group and are terminable on three months’ notice given by either party. David J. Turner, Jr. May 27, 2019 Sandra M. Stash October 21, 2019 Kathryn Klaber January 1, 2023 Malus and Clawback The Remuneration Committee may apply malus and clawback to a Performance Share Award, Restricted Share Award, deferred shares under the Annual Bonus Plan and to cash amounts under the annual bonus plan (clawback only). The relevant circumstances where these powers of recovery may operate include: • Any accounting restatement required as a result of the financial statements of any member of the Group’s being materially misstated as a result of the relevant employee’s material non-compliance with the Group’s financial reporting requirements under all applicable laws and policies; • Any fraudulent act of the relevant employee (whether proven, admitted or otherwise); • Any material breach of any term of employment; • Any material failure in supervision and oversight by the relevant employee; • Any gross misconduct, material wrongdoing or any material breach of any term of employment by the relevant employee; • A material error in the calculation of the relevant employee’s performance conditions; or • Such other exceptional negative circumstances caused by the relevant employee as the Remuneration Committee may reasonably determine, which may include the Group suffering any serious reputational damage, financial downturn, failure of risk management or corporate failure as a result of the relevant employee’s action or inaction. Normally, clawback can operate for up to two years following the vesting of an award or bonus payment. Travel and Hospitality The Remuneration Committee has been advised that corporate hospitality, whether paid for by the Group or another, and travel for Directors (and in exceptional circumstances their families) and any tax thereon may technically come within the applicable rules. As a result, the Remuneration Committee expressly reserves the right for the committee to authorize such activities within its agreed policies. Note that the Remuneration Committee does not consider travel and hospitality or the reimbursement of these expenses to form part of benefits in the normal usage of that term. Differences Between the Policy on Remuneration for Directors from the Policy on Remuneration of Other Staff While the appropriate benchmarks vary by role, the Group seeks to apply the philosophy behind this policy across the Group as a whole. Where the Group’s pay policy for Directors differs from its pay policies for groups of staff, this reflects the appropriate market rate position and/or typical practice for the relevant roles. The Group takes into account pay levels, bonus opportunity and share awards applied across the Group as a whole when setting the Directors’ Remuneration Policy. Committee Discretions The Remuneration Committee will operate the annual bonus plan, Performance Share Awards and Restricted Share Awards according to their respective rules and the above policy table. The Remuneration Committee retains discretion, consistent with market practice, in a number of respects, in relation to the operation and administration of these plans. These discretions include, but are not limited to, the following: • The selection of participants; • The timing of grant of an award/bonus opportunity; • The size of an award/bonus opportunity subject to the maximum limits set out in the policy table; • Discretion required when dealing with a change of control or restructuring of the Group; 67 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Determination of the treatment of leavers based on the rules of the plan and the appropriate treatment chosen; • Adjustments required in certain circumstances (e.g. rights issues, corporate restructuring events and special dividends); and • The annual review of performance measures, weightings and targets from year to year and resulting vesting/bonus pay-outs. While performance measures and targets for annual bonus and Performance Share Awards will generally remain unchanged once set, the Remuneration Committee has the usual discretions to amend the measures, weightings and targets in exceptional circumstances (such as a major transaction) where the original conditions would cease to operate as intended. Any such changes would be explained in the subsequent Directors’ Remuneration Report and, if appropriate, be the subject of consultation with the Group’s major shareholders. Any use of these discretions would, where relevant, be explained in the Directors’ Remuneration Report. Recruitment Remuneration Policy The Group’s recruitment remuneration policy aims to give the Remuneration Committee sufficient flexibility to secure the appointment and promotion of high-caliber executives to strengthen the management team and secure the skill sets to deliver our strategic aims. In terms of the principles for setting a package for a new Executive Director, the starting point for the Remuneration Committee will be to apply the general policy for Executive Directors and structure a package in accordance with that policy, consistent with the relevant requirements. The annual bonus plan, Performance Share Awards, and Restricted Share Awards including the maximum award levels, will operate as detailed in the general policy in relation to any newly appointed Executive Director, although, depending on the circumstances, different metrics and or targets may be set in the first year of appointment. For an internal appointment, any variable pay element awarded in respect of the prior role may either continue on its original terms or be adjusted to reflect the new appointment as appropriate. For external and internal appointments, the Remuneration Committee may agree that the Group will meet certain relocation expenses in the year of appointment and for a further two financial years, as it considers appropriate. For external candidates, it may be necessary to make additional awards in connection with the recruitment to buy-out awards and entitlements forfeited by the individual on leaving a previous employer. For the avoidance of doubt, buy-out awards are not subject to a formal cap. Any awards to a newly recruited Executive Director which are not buy-outs will be subject to the limits for the annual bonus plan and Performance Share Awards as stated in the general policy. For any buy-outs the Group will not pay more than is necessary in the view of the Remuneration Committee, and will in all cases seek, in the first instance, to deliver any such awards under the terms of the existing annual bonus plan, Performance Share Awards and Restricted Share Awards. It may, however, be necessary in some cases to make buy-out awards on terms that are more bespoke than the existing annual bonus plan and Performance Share Awards and Restricted Share Awards (for example, specific arrangements under Listing Rule 9.4.2). All buy-outs, whether under the annual bonus plan, Performance Share Awards, Restricted Share Awards or otherwise, will take due account of the service obligations and performance requirements for any remuneration relinquished by the individual when leaving a previous employer. The Remuneration Committee will seek, where it is practicable to do so, to make buy-outs subject to what are, in its opinion, comparable requirements in respect of service and performance. A new Non-Executive Director would be recruited on the terms outlined in the Remuneration Policy. Termination Policy Summary The Remuneration Committee will consider treatments on a termination having regard to all of the relevant facts and circumstances available at that time. This policy applies both to any negotiations linked to notice periods on a termination and any treatments that the Remuneration Committee may choose to apply under the discretions available to it under the terms of the relevant plan. The potential treatments on termination under these plans are as follows: Annual Bonus Plan If an Executive Director resigns without “good reason” (e.g. demotion, material reduction in compensation, relocation of principal office location of more than 200 miles) or is dismissed for cause before the end of the bonus plan year, the right to receive any bonus normally lapses. If an Executive Director ceases employment before such date by reason of death, injury, ill health, disability, retirement, resignation for good reason, or termination without cause, or any other reason determined by the Remuneration Committee, the committee may determine that such bonus will be payable pro rata for the period of time during the year (performance period) that the Executive Director was employed. Similar treatment will apply in the event of a change in control of the Group, provided, however, that if the Executive Director is terminated without cause or resigns for good reason within 180 days prior to such change in control, the bonus will be payable without reduction. The rationale is to ensure that the Executive Directors remain with the Group through completion of the change in control, so as to affect an orderly transition for the Group. Deferred bonus awards may be accelerated if the Executive Director’s leaving was for reason of death, injury, ill health, disability, retirement, resignation for good reason, or termination without cause. Performance Share Awards and Restricted Share Awards If, during the performance or vesting period, a participant: • Resigns without good reason or is dismissed for cause, awards lapse in full; • Dies, awards will be pro-rated by reference to the proportion of the performance or vesting period for which the participant remained employed subject, in the case of Performance Share Awards to the Group’s performance; or • Ceases to be employed due to injury, ill health, disability, retirement, resignation for good reason, or termination without cause, or for any other reason the Remuneration Committee determines, awards are retained subject to the performance conditions, and continue to vest on the original schedule. In such instance, awards will be pro-rated by reference to the proportion of the performance or vesting period for which the participant remained employed. The Remuneration Committee has a standard ability to vary time pro-rating. The Remuneration Committee may exercise its discretion to allow awards to vest early on cessation in suitable cases. In the event the participant dies or suffers a disability during the holding period, the holding period may be accelerated. 68 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Performance share awards and Restricted share awards will normally vest in the event of a change of control and shall take into account, amongst other things, the extent to which any performance criteria have been met (over the shortened performance periods) and the time elapsed since grant (i.e. prorated). The Group has the power to enter into settlement agreements with Directors and to pay compensation to settle potential legal claims. In addition, and consistent with market practice, in the event of the termination of an Executive Director, the Group may make a contribution towards that individual’s legal fees and fees for outplacement services as part of a negotiated settlement. Any such fees will be disclosed as part of the detail of termination arrangements. For the avoidance of doubt, the policy does not include an explicit cap on the cost of termination payments. Consideration of Employment Conditions Elsewhere in the Group The Group’s general pay and employment conditions will be taken into account when setting Executive Directors’ remuneration. The same reward principles guide reward decisions for all Group employees, including Executive Directors, although remuneration packages differ to take into account appropriate factors in different areas of the business: Base Salary/Benefits/Pension The Remuneration Committee receives an annual report summarizing the base salaries, benefits and pension arrangements received by each category of Group staff. Annual Bonus The majority of salaried employees participate in an annual bonus plan, although the quantum and balance of group, business unit and individual objectives varies by level and nature of role. The Remuneration Committee receives an annual report summarizing the bonus potential and performance metrics used in each of the annual bonus schemes in operation across the Group. Long-Term Incentives Key Group employees may receive share incentive awards, both performance and restricted, and may receive awards based on the same or different performance conditions as those for Executive Directors (although the Remuneration Committee reserves the discretion to vary the performance conditions for awards made to employees below Board level). The Remuneration Committee is provided a summary of the long-term incentive plans. As highlighted in the Engagement with Employees Statement in the Directors’ Report within this Annual Report, the Group engages with employees on a range of matters. Employees are not directly consulted in the development of the Remuneration Policy, however, as part of this employee engagement process there is the opportunity for employees to ask questions and provide feedback on the strategy of the Group, including how this links to remuneration and how executive remuneration aligns with the wider company pay policy and the Group’s strategy and objectives. Consideration of Shareholder Views The Remuneration Committee considers shareholder views received during the year and at each AGM, as well as guidance from shareholder representative bodies more broadly, when determining the remuneration policy and its implementation. Specifically in connection with the proposed remuneration policy for 2025, the Remuneration Committee consulted with major shareholders in late-2024 and into 2025 to collect feedback and gauge shareholder response as a result of which changes have been made to the quantum of the proposals and also to performance metrics used for awards granted in the Remuneration Policy’s first year. The Remuneration Committee seeks to build an active and productive dialogue with investors on developments on the remuneration aspects of corporate governance generally and it will consult with major shareholders in advance of any material change to the structure and/or operation of the policy and will seek formal shareholder approval for any such change if required. External Appointments The Group’s policy is to permit an Executive Director to serve as a non-executive director elsewhere when this does not conflict with the individual’s duties to the Group, and where an Executive Director takes such a role they may be entitled to retain any fees which they earn from that appointment. Such appointments are subject to approval by the Chairman. 69 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Illustrations of Application of Executive Director Remuneration Policy The following charts show how the remuneration policy for the Executive Director will be applied in 2025 using the assumptions shown overleaf: Minimum • Consists of base salary, benefits and pension. • Base salary is the salary to be paid in 2025 . • Long-Term Incentives (“LTI”): Consists of full vesting ( 100%) of Restricted Share Awards (maximum of 100% of base salary). • No pension is provided, only 401(k) match to the extent applicable. Target Based on what the Executive Director would receive if performance was on-target (excluding share price appreciation and dividends): • Annual bonus: Consists of the target bonus ( 50% of maximum opportunity used for illustrative purposes). • LTI: Consists of the target level of vesting (50%) of Performance Share Awards (maximum of 325% of base salary) and full vesting (100%) of Restricted Share Awards (maximum of 100% of base salary). Maximum Based on the maximum remuneration receivable (excluding share price appreciation and dividends): • Annual bonus: Consists of maximum bonus of 200% of base salary. • LTI: Consists of full vesting (100%) of Performance Share Awards (maximum of 325% of base salary) and full vesting ( 100%) of Restricted Share Awards (maximum of 100% of base salary). Maximum with share price growth Based on the Maximum scenario set out above but with a 50% share price increase applied to the value of Performance Share Awards. ($ thousands) Base Salary RSU Award Benefits Benefit Plan(a) Total Fixed Rusty Hutson, Jr. $807 $807 $17 $42 $1,673 (a) Reflects amounts received under the Group’s 401(k) contribution plan and health insurance benefits. Robert R. (Rusty) Hutson, Jr. 70 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Part B: Annual Report on Remuneration The remuneration for the Executive and Non-Executive Directors of the Group who performed qualifying services during the year is detailed below. For the year ended December 31, 2024, the aggregate compensation paid to the members of our board of directors and our executive officers for services in all capacities was approximately $4 million. Executive officers are entitled to matching contributions from the Group of up to $26 thousand per annum into their 401(k) retirement plans. They also receive a range of core benefits such as life insurance, private medical coverage and annual health screens. The Non-Executive Directors received no remuneration other than their annual fee. The aggregate fees and any benefits of the Chairman of the Board and Non-Executive Directors will not exceed the limit from time-to-time prescribed within the Group’s Articles of Association for such fees which is currently £1,055,000 (approximately $1,350,400) per annum. In addition, non-executive directors are reimbursed all necessary and reasonable expenses incurred in connection with the performance of their duties and any tax thereon in accordance with the Group’s Non-Executive Director Expense Reimbursement Policy. Directors’ remuneration for the years ended December 31, 2024 and 2023 (audited): Executive Director Rusty Hutson, Jr. (In thousands) December 31, 2024 December 31, 2023 Salary/fees $780 $750 Taxable benefits(a) 17 12 Benefit plan(b) 42 31 Pension(c) — — Total fixed pay $839 $793 Bonus(d) 1,160 825 Long-term incentives(e) 1,008 303 Total variable pay $2,169 $1,128 Total remuneration $3,007 $1,921 Non-Executive Directors - Total Remuneration (In thousands) December 31, 2024 December 31, 2023 David E. Johnson $223 $216 Martin K. Thomas 160 155 David J. Turner, Jr. 173 168 Sandra M. Stash 160 156 Kathryn Z. Klaber 160 139 Sylvia Kerrigan 173 160 (a) Taxable benefits were comprised of Group paid life insurance premiums and automobile reimbursements. (b) Reflects matching contributions under the Group’s 401(k) plan and health insurance benefits. (c) The Executive Director does not receive a pension provision. (d) Further details of the bonus outcome for 2024 can be found in Annual Bonus for Executive Directors within this Annual Report. For 2024, the bonus total for Rusty Hutson, Jr. represents 148.8% of approved base salary. Subject to the Remuneration Policy, a mounts above 100% of salary will be deferred into cash for one year provided continued service, without additional performance conditions. For 2023, the bonus total for Rusty Hutson, Jr. represented 110.1% of base salary. Amounts above 100% of salary were deferred into cash for one year provided continued service, without additional performance conditions. (e) For 2024, the value of the Performance Share Award granted in 2022, including dividend equivalent units (“DEUs”) accrued to date, has been based on the number of shares and DEUs that will vest and the three-month average share price for the period to December 31, 2024 of $13.96 ( £10.87) per share. The overall payout for the Performance Share Award was 67% and the grant share price for the awards was $30.47 (£23.36) per share and, accordingly, the relevant figures are reflective of a decrease of 54% in the Group’s share price over the three year period. For 2023 , the value of the Performance Share Award granted in 2021 , including DEUs accrued to the vesting date, has been restated to reflect the actual share price on the vesting date of $11.60 per share. The values disclosed last year were estimated using the three-month average share price for the period to December 31, 2023 of £13.62 per share using an exchange rate of £1:$1.24055. 2024 Annual Bonus for Executive Director (Audited) For 2024 the overall bonus plan for the Executive Director was a maximum of 175% of base salary with an actual achieved formulaic bonus of 148.8%. The Group delivered a strong operational performance in 2024 . The following table summarizes the performance targets and outcomes which led to the Remuneration Committee’s decisions as to the payout percentages. 71 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance The targets were as follows: Measure Threshold(a) Target(a) Maximum (100% Payout) Actual Performance % of Total Bonus Payout % Adjusted EBITDA per share(b) $8.00 $8.21 $8.42 $10.79 100% 50% 50% Cash cost per Mcfe(c) $1.35 $1.30 $1.27 $1.35 25% 20% 5% Sustainability (see below) 30% 30% Total % of maximum 85% Total % of salary - Rusty Hutson, Jr. 148.8% (a) Threshold was 25% and Target was 75% for the adjusted EBITDA per share and cash cost per Mcfe measures and 0% to 50% and 0% to 75%, respectively, for the sustainability measures, but for all measures stretch allowed inclusion of acquisitions. (b) Actual results for the adjusted EBITDA per share measure utilized fully diluted weighted average shares outstanding. (c) Actual results for the cash cost per Mcfe measure excluded 2024 acquisitions and irregular G&A expense. In respect of the non-financial performance targets set for the Executive Director, these were set against a range of strategic targets at the start of the year. The targets set were aligned to the Group’s corporate objectives and strategy. Details of the measures, to the extent they are not commercially sensitive are shown below. SUSTAINABILITY - ENVIRONMENTAL Target Actual Performance % of Total Bonus Payout % Reduce methane intensity(a) Threshold: 0.80 / Target: 0.76 / Stretch: 0.70 0.70 Achieved: 100% 10.00% 10.00% Pneumatic valve replacement(b) Threshold: N/A / Target: N/A / Stretch: 100% 100% Achieved: 100% 5.00% 5.00% 15.00% 15.00% SUSTAINABILITY - SOCIAL Target Actual Performance % of Total Bonus Payout % Reduce TRIR(a) Threshold: 1.19 / Target: 1.07 / Stretch: 0.95 0.89 Achieved: 100% 2.50% 2.50% Reduce LTIR(a) Threshold: 0.88 / Target: 0.80 / Stretch: 0.71 0.38 Achieved: 100% 2.50% 2.50% Reduce MVA(a) Threshold: 0.65 / Target: 0.59 / Stretch: 0.52 0.34 Achieved: 100% 5.00% 5.00% 10.00% 10.00% SUSTAINABILITY - GOVERNANCE Target Actual Performance % of Total Bonus Payout % Development training(c) Threshold: 50% / Target: 60% / Stretch: 75% 86% Achieved: 100% 5.00% 5.00% 5.00% 5.00% (a) Refer to Key Performance Indicators within this Annual Report for additional information regarding these metrics. (b) Refer to Protecting Our Environment in the Sustainability Review within this Annual Report for additional information regarding this metric. (c) The actual result reflects the percentage of LinkedIn Learning development training courses that were completed during the year ended December 31, 2024. For additional information about the Group’s sustainability efforts, refer to the Sustainability Review. 72 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Long-Term Incentives Outcome (Audited) 2022 LTIP Awards The performance period in respect of the Performance Share Award granted in 2022 came to an end on December 31, 2024 . Performance conditions were Return on Equity (40%), Absolute TSR ( 30%), Relative TSR ( 10%) and Methane Intensity ( 20% ) targets measured over three years. The targets and outcomes are set out below: % of Total Award Threshold Maximum (15% of maximum) Achieved (100% of maximum) Vesting % of Component Payout %(a) Three-Year Average ROE(b) 40% 15% 25% 30% 100% 40% Absolute TSR (per annum) 30% 10% 20% 0% 0% 0% Three-Year TSR v FTSE 250 10% 50th percentile 75th percentile 65th percentile 65% 7% Three-Year Methane Intensity Reduction 20% 10% 20% 22% 100% 20% Performance factor 67% (a) Calculated as % of total award multiplied by vesting % of component. (b) Calculated as (adjusted EBITDA - recurring capital expenditures - interest expense) / invested equity. Based on the vesting percentages above, the number of shares expected to vest in March 2025 and their estimated value (based on the three-month average share price to December 31, 2024 of £10.870 per share ($13.96 per share based upon a GBP:USD exchange rate of £1:$1.2837) are as follows: Maximum number of shares (a) Number of shares to lapse (b) Number of Shares to vest (c) Estimated value at vesting (d) Grant date face value of awards vesting (e) Impact of share price on vesting (f) Rusty Hutson, Jr. 107,830 35,591 72,239 $1,008,456 $2,201,122 $(1,192,666) (a) Includes 37,729 dividend equivalent units accrued over the performance period to date in the maximum number of shares that will vest in March 2025 . (b) Includes 12,457 dividend equivalent units accrued over the performance period to date in the number of shares to lapse in March 2025. (c) Includes 25,272 dividend equivalent units accrued over the performance period to date in the number of shares to vest in March 2025. (d) Based on the three-month average share price to December 31, 2024 of $13.96 (£10.87) per share. (e) Based on the number of shares vesting multiplied by the share price used to calculate the award of $30.47 (£23.36), being the average share price over the five-day period commencing on March 22, 2022, the date the Group issued its final 2021 results. The award was based upon a GBP:USD exchange rate of £1:$1.3042. The date of grant was March 15, 2022. (f) The grant share price for the award was $30.47 (£23.36) and accordingly the relevant figures are reflective of a decrease of 54% in the Group’s share price over the three year period. Share Awards Granted in 2024 (Audited) 2024 LTIP Awards During the year, the Executive Director received a Performance Share Award (conditional shares), which may vest after a three-year performance period which will end on December 31, 2026 , based on the achievement of stretching performance conditions. Value of Award as a % of Base Salary Face Value of Award ($) Number of Shares Rusty Hutson, Jr. 325% $2,535,000 227,151 In accordance with the ongoing policy, the share price used to calculate the award was $11.16 (£8.83) , being the average share price over the five-day period commencing on March 19, 2024 , the date that the Group issued its final 2023 results. The awards are based upon a GBP:USD exchange rate of £1:$1.264 , which was the exchange rate at the date of grant. The date of grant was March 25, 2024. The 2024 LTIP Awards will vest following completion of the performance period (January 1, 2024 - December 31, 2026), and no later than March 31, 2027, and vested shares will also be subject to a further two-year holding period. Before approving the number of shares to be awarded the Committee engaged in fulsome discussion as to whether to apply its discretion to reduce the award value in light of the lower share price compared to the share price used for the prior year’s grant. The Remuneration Committee determined that using the average share price over the five day period prior to grant remained appropriate in the circumstances, as has been the Group’s policy for several years. The Remuneration Committee has certain discretion to review the outcome of the award upon vesting and may consider adjustments in certain circumstances if the share price used could result in an unintended result. In its deliberation, the Remuneration Committee considered the stretching and robust nature of the performance conditions used in the LTIP, and noted that the most recent LTIP vesting outcomes were significantly lower than maximum at 67% and 40% , respectively. As of the date of this report the share price in March 2025 is similar to the share price at the time the 2024 LTIP award was made, which indicates so far that a reduction in the value of the award was not necessary. The Remuneration Committee will keep this under review. The performance conditions are a weighted mix of Return on Equity (40%), Absolute TSR (30%), Relative TSR (10%) and Emissions (20%) targets measured over three years as described below. These measures encourage the generation of sustainable long-term returns to shareholders. In determining the level of vesting, the Remuneration Committee will consider that the outcome of the measurement reflects the underlying performance or financial health of the Group. 73 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Return on Equity (40% of Total Award) Absolute TSR (30% of Total Award) Three-Year Average ROE(a) % of that Part of the Award that Vests Three-Year TSR % of that Part of the Award that Vests Below 15% per annum 0% Below 10% per annum 0% 15% per annum 15% 10% per annum 15% 25% per annum or above 100% 20% per annum or above 100% 15% to 25% per annum Pro rata straight-line between 15% and 100% 10% to 20% per annum Pro rata straight-line between 15% and 100% Relative TSR (10% of Total Award) Emissions (20% of Total Award) Three-Year TSR v FTSE 250 % of that Part of the Award that Vests Emissions over Three Years % of that Part of the Award that Vests Below median 0% Below 8% Methane Intensity Reduction 0% Median 15% 8% Methane Intensity Reduction 15% Upper quartile or above 100% 15% Methane Intensity Reduction 100% Median to upper quartile Pro rata straight-line between 15% and 100% 8% to 15% Methane Intensity Reduction Pro rata straight-line between 15% and 100% (a) Calculated as adjusted EBITDA - recurring capital expenditures - interest expense) / invested equity. Outstanding Executive Director Share Plan Awards (Audited) Details of all outstanding share awards as of December 31, 2024 made to Executive Director are set out below: Rusty Hutson, Jr. Award Type Exercise Price (£) Grant Date Interest at January 1, 2024 Awards Granted in the Year Accrued Dividend Equivalents Awards Exercised in the Year Awards Lapsed in the Year Interest at December 31, 2024 (a) Exercise/Vesting Period PSU March 24, 2024 — 227,151 37,880 — — 265,031 March 2027 (b) PSU March 21, 2023 124,051 — 10,697 — — 134,748 March 2026 (c) PSU March 15, 2022 99,269 — 8,561 — 35,591 72,239 March 2025 (d) Options £24.00 May 9, 2019 6,600 — — — — 6,600 May 2022 - May 2029 (e) Options £16.80 April 14, 2018 64,333 — — — — 64,333 May 2021 - May 2028 (f) (a) A performance factor of 67% was applied to 70,101 of the awards granted to Mr. Hutson in March 2022, and 37,729 dividend equivalent units accrued over the performance period to date, resulting in remaining interest of 72,239 total units vesting in March 2025. (b) Refer to Share Awards Granted in 2024 above for details of performance conditions. (c) Refer to the Group's 2023 Annual Report for details of performance conditions. (d) Refer to the Group's 2022 Annual Report for details of performance conditions. (e) Options granted on May 9, 2019 with an exercise price of £24.00 per share. Consists entirely of vested but unexercised options. (f) Options granted on April 14, 2018 with an exercise price of £16.80 per share with a three-year ratable vesting period. Consists entirely of vested but unexercised options. During the year ended December 31, 2024, the highest closing price of the Group’s shares was $16.97 (£13.44 ) and the lowest closing price was $10.90 ( £8.20 ) . At December 31, 2024 the closing share price was $16.80 ( £13.44). 74 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Statement of Directors’ Shareholding & Share Interests (Audited) The table below details, for each Director, the total number of Directors’ interests in shares at December 31, 2024 , which has not changed as of the date of this report: Shareholding Shareholding Required (% of Salary) Compliance With Share Ownership Guidelines Share Interests Rusty Hutson, Jr. 1,234,134 300% ü 542,951 (a) David E. Johnson 23,750 – (b) — Martin K. Thomas 113,850 – (b) — David J. Turner, Jr. 33,087 – (b) — Sandra M. Stash 4,092 – (b) — Kathryn Z. Klaber 2,912 – (b) — Sylvia Kerrigan 3,181 – (b) — (a) A performance factor of 67% was applied to 70,101 of the awards granted to Mr. Hutson in March 2022 and 37,729 dividend equivalent units accrued over the performance period to date, resulting in remaining interest of 72,239 total units vesting in March 2025 . As of December 31, 2024, 70,933 vested options remained unexercised. All other awards were unvested as of December 31, 2024. (b) The Non-Executive Directors purchase shares twice annually pursuant to the Non-Executive Director Share Purchase Program implemented in 2022. Shares purchased under the Non-Executive Director Share Purchase Program must be held until retirement from the Board. While this is not part of the Share Ownership Guidelines, each Non-Executive Director is in compliance with the parameters of the Non-Executive Director Share Purchase Program. Payments to Past Directors (Audited) Robert Post retired as a Board member in April 2020. Mr. Post continued to provide advice to the Board post-retirement as a consultant, receiving fees in 2024 of $97,500 . Payments for Loss of Office (Audited) No payments for loss of office were made during the year. Executive Director Serving as Non-Executive Directors of Other Companies During the year, the Executive Director did not receive any Board-related remuneration for his service as a Non-Executive Director of any other company. Performance Graph & CEO Remuneration Table The Regulations require a line graph showing the TSR on a holding of shares in the Group since admission to the Premium Segment of the Main Market of the LSE to the most recent financial year end following such admission, as well as the TSR for a hypothetical holding of shares in a broad equity market index for the same period. The Group was admitted to the Main Market on May 18, 2020 and the graph below covers that period, comparing the Group’s TSR to that of the FTSE 250 (excluding Investment Trusts), an index of which the Group is a constituent. The Remuneration Committee is satisfied that the CEO’s remuneration is supported by the TSR performance data presented below. Total Shareholder Return Rebased at 100 on May 18, 2020 Source: Eikon by Refinitiv 75 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance The table below details certain elements of the CEO’s remuneration over the same period as presented in the TSR Index graph: (In thousands) Year CEO Single Figure of Total Remuneration (a) Annual Bonus Pay-Out Against Maximum % Long-Term Incentive Vesting Rates Against Maximum Opportunity % 2024 Rusty Hutson, Jr. $3,007 85% 67% 2023 Rusty Hutson, Jr. $1,921 63% 40% 2022 Rusty Hutson, Jr. $4,431 85% 71% 2021 Rusty Hutson, Jr. $2,795 85% 45% 2020 Rusty Hutson, Jr. $2,965 94% 100% (a) For 2024, the single figure of total remuneration includes an estimated value for the LTIP component . For the years 2023, 2022, 2021, and 2020, the single figure of total remuneration has been restated to reflect the actual value for the LTIP component. Refer to the Directors’ remuneration table in Part B: Annual Report on Remuneration within this Annual Report for additional information. Annual Change in Remuneration of Each Director Compared to Employees The table below presents the year-on-year ( 2020 - 2024 ) percentage change in remuneration for each Director and all employees of the Group and its subsidiaries. % Change from 2023 to 2024 % Change from 2022 to 2023 % Change from 2021 to 2022 % Change from 2020 to 2021 % Change from 2019 to 2020 Name Salary/ Fee Annual Bonus Taxable Benefits Salary/ Fee Annual Bonus Taxable Benefits Salary/ Fee Annual Bonus Taxable Benefits Salary/ Fee Annual Bonus Taxable Benefits Salary/ Fee Annual Bonus Taxable Benefits Rusty Hutson, Jr. 4% 41% 42% 4% (23%) —% 4% 21% 20% 3% (7%) 400% 59% 55% —% David E. Johnson 3% —% —% 8% —% —% 19% —% —% 3% —% —% 66% —% —% Martin K. Thomas 3% —% —% 7% —% —% 14% —% —% 2% —% —% 27% —% —% David J. Turner, Jr. 3% —% —% 8% —% —% 16% —% —% 3% —% —% 132% —% —% Sandra M. Stash 3% —% —% 8% —% —% 14% —% —% 2% —% —% 520% —% —% Kathryn Z. Klaber(a) 15% —% —% 100% —% —% —% —% —% 2% —% —% —% —% —% Sylvia Kerrigan(b) 8% —% —% 33% —% —% 445% —% —% 100% —% —% —% —% —% All employees, excluding Directors 4% 4% —% 4% 4% —% 5% 5% —% 11% (2%) —% 4% 4% —% (a) David J. Turner, Jr. was appointed to the Board on May 27, 2019 . (b) Sandra M. Stash was appointed to the Board on October 21, 2019. (c) Kathryn Z. Klaber was appointed to the Board on January 1, 2023. (d) Sylvia Kerrigan was appointed to the Board on October 11, 2021. CEO to Employee Pay Ratio Although the Group does not have 250 full time equivalent UK employees, the Group provides a CEO to employee pay ratio on a voluntary basis below. The Remuneration Committee is satisfied that the CEO to employee pay ratio is consistent with the Group’s overall aim to ensure its employees are rewarded fairly and competitively for their contributions. Year Method 25th Percentile Pay Ratio Mean Pay Ratio 75th Percentile Pay Ratio 2024 Option A 27:1 19:1 18:1 2023 Option A 25:1 17:1 16:1 2022 Option A 28:1 19:1 17:1 2021 Option A 44:1 30:1 28:1 2020 Option A 55:1 30:1 14:1 Notes to the CEO to employee pay ratio: (1) We have used Option A with figures as of December 31, 2024 , following guidance that this is the preferred approach of some proxy advisors and institutional shareholders. Option A captures all relevant pay and benefits for all employees. (2) The ratios shown are representative of the 25th percentile, mean and 75th percentile pay for all employees within the Group during the 2024 calendar year. (3) The CEO pay ratio is based on the taxable income for all employees employed for the duration of calendar year 2024 as reported on U.S. IRS Form W-2, Wage and Tax Statement. 76 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance Relative Importance of Spend on Pay The table below details the change in total employee pay between 2023 and 2024 , compared with distributions to shareholders by way of dividend or share buybacks. (In thousands) 2024 2023 % Change Total gross employee pay $133,024 $124,834 7% Dividends/share buybacks 104,994 179,089 (41%) The number of employees as of December 31, 2024 was 1,589 , as compared to 1,603 employees as of December 31, 2023. Statement of Voting at General Meeting The following table shows the results of the binding Remuneration Policy vote at the April 26, 2022 AGM and the advisory Directors’ Remuneration Report vote at the May 10, 2024 AGM. (Binding Vote) (Advisory Vote) Approval of the Directors’ Remuneration Policy Director Remuneration Report Total number of votes % of votes cast Total number of votes % of votes cast For 27,783,031 83% 25,389,754 92% Against 5,793,079 17% 2,133,133 8% Votes withheld 1,164,541 143,368 Shareholder Engagement At the 2024 AGM, while shareholders approved most of the resolutions with majorities in excess of 99%, Resolution 19 (Amendment to 2017 Equity Incentive Plan to increase the number of shares available under the Plan), while receiving 74% of the vote "FOR", did not meet the 75% threshold to pass. The UK Corporate Governance Code requires that companies provide an update to the market within six months of an AGM where more than 20% of shareholders have voted against a resolution. This statement provides an update on the actions that the Group has taken. Following the AGM, the Group consulted and engaged with a number of shareholders who voted against the resolutions to better understand their concerns. The Directors are thankful to the shareholders for sharing their views. They understand that the negative vote was principally related to the disconnect between traditional equity compensation plans in the United States, the Group’s primary operating market. In particular, UK shareholders were concerned that the proposed changes could have resulted in new issuances under the plan that would be in excess of the normal 10% in 10 years dilution limit. The dialogue with the shareholders has highlighted that there remains strong support for the Group’s equity incentive arrangements and at the upcoming AGM shareholders will be asked to approve changes to the dilution limits, in order to simplify them and to bring them into line with UK norms, including a 10% in 10 years limit on the use of new issue or treasury shares. The Board has discussed the feedback received in detail and continues to actively dialogue with shareholders on the equity incentive and compensation arrangements. Implementation of Remuneration Policy for 2025 Base Salary The Executive Director’s base salary for 2025 will be as follows: • Rusty Hutson, Jr: $807,128 For 2025, the Remuneration Committee approved an increase to the CEO’s salary by 3.5%. This compares to increases across the Group ranging from 0% to 7% based on performance, with an average of 3.5%. It is anticipated that increases for the remainder of the life of the policy will be in-line with the range of the workforce. Pension: The Executive Director does not receive a pension provision. Benefits: The Executive Director receives life insurance and automobile benefits, and matching contributions under the Group’s 401(k) plan. There is no current intention to introduce additional benefits in 2025. Annual Bonus: Subject to approval of the Policy, the overall 2025 bonus plan maximum will be 200% of base salary for Rusty Hutson, Jr. and will be based on a range of targets relating to adjusted EBITDA per share ( 50%), cash cost per Mcfe (25%), and sustainability measures (25% ). Due to issues of commercial sensitivity, we do not believe it is in shareholders’ interests to disclose any further details of these targets on a prospective basis. However, the Remuneration Committee is committed to adhering to principles of transparency in terms of retrospective annual bonus target disclosure and will, therefore, provide appropriate and relevant levels of disclosure for the bonus targets applied to the 2025 bonus (and performance against these targets) in next year’s Director’s Remuneration Report. Bonuses are payable in cash. For Executive Directors who have not yet achieved the required shareholding, 50% will be deferred as either shares or cash for two years provided continued service. Current Executive Directors who have met their shareholding guidelines will not be required to defer any of the annual bonus. Long-Term Incentives: Subject to approval of the Policy, Performance Share Awards will be made in 2025 to Rusty Hutson, Jr. with shares worth 325% of salary and Restricted Share Awards with shares worth 100% of salary. The share price used to calculate the number of shares subject to the award will be based on the average share price over the five-day period commencing on the date that the Group issues its final 2024 results. These awards will vest three years after grant, and will also be subject to a further two-year holding period after the initial three-year period to vesting. 77 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance The performance conditions for the Performance Share Award will be a mix of Return on Equity (40%), Absolute TSR (20%), Relative TSR (20%) and Emissions (20%) targets measured over three years as described below. These are measures which encourage the generation of sustainable long-term returns to shareholders. When determining the level of vesting the Remuneration Committee will also consider that the outcome of the measurement reflects the underlying performance or financial health of the Group. Return on Equity (40% of Total Award) Absolute TSR (20% of Total Award) Three-Year Average ROE % of that Part of the Award that Vests Three-Year Absolute TSR % of that Part of the Award that Vests Below 15% per annum —% Below 10% per annum —% 15% per annum 15% 10% per annum 15% 25% per annum or above 100% 20% per annum or above 100% 15% to 25% per annum Pro rata straight-line between 15% and 100% 10% to 20% per annum Pro rata straight-line between 15% and 100% Relative TSR (20% of Total Award) Emissions (20% of Total Award) Three-Year TSR v Bespoke Peer Group (a) % of that Part of the Award that Vests Emissions during 2026 - 2027 over Baseline(b) % of that Part of the Award that Vests Below median —% Below 5% emissions reduction —% Median 15% 5% emissions reduction 15% Upper quartile or above 100% 10% emissions reduction 100% Median to upper quartile Pro rata straight-line between 15% and 100% 5% to 10% emissions reduction Pro rata straight-line between 15% and 100% (a) Comprised of Amplify Energy Corp, Berry Corporation, CNX Resources Corp, Granite Ridge Resources, Highpeak Energy, Mach Natural Resources, Northern Oil and Gas, Riley Exploration Permian, Ring Energy, TXO Partners, Vital Energy, and W&T Offshore. (b) Baseline emissions number against which the reductions will be measured will be calculated over the course of 2025 and subject to final Remuneration Committee approval. Non-Executive Directors’ Fees David E. Johnson will receive an annual fee of £174,000 (or $222,720) as Chairman. Each Non-Executive Director receives a base annual fee of £105,000 (or $134,400 ), with additional fees as noted below (table in thousands, except rates). GBP Exchange Rate USD David J. Turner, Jr.(a) £135 1.28 $173 Sandra M. Stash(b) 125 1.28 160 Sylvia Kerrigan(c) 135 1.28 173 David E. Johnson 174 1.28 223 Martin K. Thomas(d) 125 1.28 160 Kathryn Z. Klaber(e) 125 1.28 160 Total £819 $1,049 (a) Includes Audit & Risk Committee Chair fee of £30,000 (or $38,400 ). (b) Includes Sustainability & Safety Committee Chair fee of £20,000 (or $25,600). (c) Includes Senior Independent Director fee of £10,000 (or $12,800) and Remuneration Committee Chair fee of £20,000 (or $25,600). (d) Includes Vice Chair fee of £20,000 (or $25,600). (e) Includes Nomination & Governance Committee Chair fee of £20,000 (or $25,600). David J. Turner, Jr. David E. Johnson Sandra M. Stash Chair of the Remuneration Committee Chair of the Board and Member of the Remuneration Committee Member of the Remuneration Committee March 17, 2025 March 17, 2025 March 17, 2025 78 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance The Sustainability & Safety Committee’s Report Committee Composition • Sandra M. Stash, Chair • David E. Johnson • Kathryn Z. Klaber Key Objective The Sustainability & Safety Committee acts on behalf of the Board and the shareholders to oversee the practices and performance of the Group with respect to health and safety, business ethics, conduct and responsibility, social affairs, the environment and broader sustainability issues. As part of the Group’s overall sustainability actions, the Sustainability & Safety Committee oversees the Group’s climate scenario analysis planning and performance against goals and ensures adherence to the recommended TCFD disclosures for use by investors, lenders, insurers and other stakeholders. Overview The Sustainability & Safety Committee assesses the Group’s overall sustainability performance and provides input into the Annual Report, the Sustainability Report and other disclosures on sustainability. It also advises the Remuneration Committee on metrics relating to sustainable development, GHG and other emissions, regulatory compliance, community engagement and other social goals, as well as health and safety that apply to executive remuneration. The Sustainability & Safety Committee reviews the Group’s Sustainability and Safety plans and reviews execution of the plan and audit outcomes. In addition, the Sustainability & Safety Committee reviews and considers external stakeholder perspectives in relation to the Group’s business, and reviews how the Group addresses issues of stakeholder concern that could affect its reputation and license to operate. The overall accountability for sustainability and safety is with the President and Chief Financial Officer and the Senior Leadership Team, including the Executive Vice President of Operations, Chief Human Resources Officer, the Senior Vice President of EHS and the Senior Vice President of Sustainability, who are assisted by the EHS team. Key Matters Discussed by the Committee During the past year the Sustainability & Safety Committee: • Established and reviewed the Group’s sustainability and safety strategies and assessed the Group’s performance; • Continued the review program to align executive management remuneration with key safety and sustainability performance indicators and metrics, including factoring GHG reductions into long-term incentives, that has been communicated to the Remuneration Committee; • Engaged with the leadership of the Group to understand the diversity profile of the Group’s workforce; • Engaged with a consortium of advisers, comprising leading global environmental consultancies and other strategic advisers, and continued to implement the recommendations set forth by the TCFD with the exception of reporting on Scope 3; and • Reviewed the Group’s sustainability related communications, including the composition and approval of the Group’s 2023 Sustainability Report and preparation for issuance of the 2024 Sustainability Report. Committee Activities by Focus Area During 2024, the Sustainability & Safety Committee met regularly to review and discuss a range of prioritized topics. These topics included (i) the safe and responsible operation of the Group’s upstream and midstream assets; (ii) environmental protection and conservation activities; (iii) the Group’s approach to managing climate risk, (iv) the Group’s emissions reduction capital programs; and (v) the Group’s plugging business. The Sustainability & Safety Committee also focused on the following: Process Safety The Executive Vice President of Operations presented an overview of the Group’s process safety approach and identification of high-risk facility performance, as well as comparable performance benchmarking against industry peers. Corporate Scorecard Metrics Oversight • The Sustainability & Safety Committee reviewed the quantitative and qualitative drivers impacting the Group’s personnel safety, emissions management, environmental performance, and asset retirement metrics that support performance analysis. • The Sustainability & Safety Committee reviewed and discussed the Group’s incident rate for the year. The Group created and empowered a new Safety Strategy Committee to address safety culture survey findings, including identifying and advancing specific areas for improvement and accountability. The Group also established monthly Foreman-Led safety meetings and regular Safety Task Force meetings, which have lead to meaning improvements and interactions. Sustainability Rating Agency Scorecard The Sustainability & Safety Committee reviewed the Group’s various third-party sustainability rating scores, including analysis of the process and review of scorecards to determine targeted areas of improvement. Climate Review The Sustainability & Safety Committee engaged the support of industry and internationally recognized consultants and advisers to help the Group update its climate scenario analysis and advance its work on governance, strategy, risk management and metrics as set forth under the TCFD. The Sustainability & Safety Committee oversaw the Group’s engagement with the GHG emissions inventory and associated scenario analyses and remains actively engaged in setting targets in accordance with the recommendations. The Sustainability & Safety Committee has considered the relevance of material climate-related matters when preparing this Annual Report. Climate topics reviewed at the Sustainability Committee meetings and/or effectuated during 2024 included: • Progress on 2024 emission reduction goals • Long-term strategy for asset retirement of Company-owned wells and third-party owned or abandoned wells 79 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • U.S. and UK climate regulations and reporting requirements and potential impact thereof • Capital budgets and expenditures for emission reduction and other climate initiatives • Environmental-related KPIs for executive remuneration • Environmental considerations in M&A screening and due diligence processes • OGMP 2.0 Gold Standard certification progress and actions • Emergency response readiness, including stakeholder communications and business continuity Further information can be found in the Climate Report within this Annual Report. Acquisition Due Diligence Adding emphasis to its oversight of the Group’s investment activities, the Sustainability & Safety Committee stayed apprised of the progress and assessment of the Group’s emissions screening efforts to aid in its assessment that proposed acquisitions and other capital investments have on its consolidated GHG emissions profile and associated publicly stated targets. Emission Reduction Initiative The Sustainability & Safety Committee engaged in strategic discussions with senior management regarding its capital program for emissions reductions, including regular updates on the deployment and success of handheld detection equipment and aerial LiDAR surveys, as well as the replacement of pneumatic valves. Oil & Gas Methane Partnership Recognition The Sustainability & Safety Committee supported the Group’s efforts in achieving the OGMP 2.0 Gold Standard Pathway designation in recognition of the Group’s demonstrated commitment to set aggressive and achievable multi-year plans designed to accurately measure and transparently report its efforts to reduce methane emissions. Committee Effectiveness The Sustainability & Safety Committee performed a critical analysis internal review and evaluation on itself, as part of its annual self-review process. No significant areas of concern were raised. Membership The formation of a Sustainability & Safety Committee is not a recommendation under the current UK Corporate Governance Code. The Group and the Board, however, consider such a committee to be an imperative given the operational footprint of the business and the evolving operational, regulatory, social and investment markets within which the Group operates. The Sustainability & Safety Committee is currently comprised of the Non-Executive Chairman and two Independent Non-Executive Directors: Sandra M. Stash, the Sustainability & Safety Committee Chair, David E. Johnson and Kathryn Z. Klaber. Benjamin Sullivan, Senior Executive Vice President, Chief Legal & Risk Officer and Corporate Secretary acts as Secretary to the committee. The Sustainability & Safety Committee has extensive and relevant experience in EHS and social matters through their other business activities. For one example, Ms. Stash formerly served as Executive Vice President — Safety, Operations, Engineering, and External Affairs for Tullow Oil until her retirement. Meetings and Attendance The Sustainability & Safety Committee met six times during 2024 and twice thus far in 2025. The Sustainability & Safety Committee also regularly meets in private executive session at the end of its committee meetings, without management present, to ensure that points of common concern are identified and that priorities for future attention by the committee are agreed upon. The Chair of the Sustainability & Safety Committee keeps in close contact with the Chief Legal & Risk Officer, the Senior Vice President of Sustainability, the Senior Vice President of EHS and the EHS team and external consultants between meetings of the committee. For Sustainability & Safety Committee meeting attendance for each Director refer to the Directors’ Report within this Annual Report. The list below details the members of the Senior Leadership Team who were invited to attend meetings as appropriate during the calendar year. • Bradley G. Gray (President and Chief Financial Officer) • Benjamin Sullivan (Senior Executive Vice President, Chief Legal & Risk Officer, and Corporate Secretary) • Maverick Bentley (Executive Vice President of Operations) • Paul Espenan (Senior Vice President of Environmental, Health and Safety) • Teresa Odom (Senior Vice President of Sustainability) • Mark Kirkendall (Executive Vice President, Chief Human Resources Officer) Responsibilities and Terms of Reference The Sustainability & Safety Committee’s main duties are: • Overseeing the development and implementation by management of policies, compliance systems, and monitoring processes to ensure compliance by the Group with applicable legislation, rules and regulations; • Establishing with management long-term emissions, climate and social sustainability and, EHS goals and evaluating the Group’s progress against those goals; • Advising management on implementing, maintaining and improving environmental and social sustainability and EHS strategies, implementation of which creates value consistent with long-term preservation and enhancement of shareholder value; • Considering and advising management of emerging environmental and social sustainability issues that may affect the business, performance or reputation of the Group and makes recommendations, as appropriate, on how management can address such issues; • Monitoring the Group’s risk management processes related to environmental and social sustainability and EHS with particular attention to managing and reducing environmental risks and impacts; and 80 Table of Contents Diversified Energy Company PLC 2024 Annual Report Corporate Governance • Reviewing handling of incident reports, results of investigations into material events, findings from environmental and social sustainability and EHS audits and the action plans proposed pursuant to those findings. The Sustainability & Safety Committee has formal terms of reference which can be viewed on the Group’s website. Sandra M. Stash Chair of the Sustainability & Safety Committee March 17, 2025 81 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Group Financial Statements Page Independent Auditors’ Report to the Members of Diversified Energy Company PLC 82 Group Financial Statements 91 Consolidated Statement of Comprehensive Income 91 Consolidated Statement of Financial Position 92 Consolidated Statement of Changes in Equity 93 Consolidated Statement of Cash Flows 94 Notes to the Group Financial Statements 95 Note 1 - General Information 95 Note 2 - Basis of Preparation 95 Note 3 - Material Accounting Policies 97 Note 4 - Significant Accounting Judgments & Estimates 101 Note 5 - Acquisitions & Divestitures 102 Note 6 - Revenue 105 Note 7 - Expenses by Nature 106 Note 8 - Taxation 108 Note 9 - Earnings (Loss) Per Share 111 Note 10 - Natural Gas & Oil Properties 112 Note 11 - Property, Plant & Equipment 112 Note 12 - Intangible Assets 114 Note 13 - Derivative Financial Instruments 114 Note 14 - Trade & Other Receivables 119 Note 15 - Other Assets 119 Note 16 - Share Capital 119 Note 17 - Non-Cash Share-Based Compensation 121 Note 18 - Dividends 123 Note 19 - Asset Retirement Obligations 123 Note 20 - Leases 125 Note 21 - Borrowings 126 Note 22 - Trade & Other Payables 132 Note 23 - Other Liabilities 132 Note 24 - Fair Value & Financial Instruments 133 Note 25 - Financial Risk Management 134 Note 26 - Commitments & Contingencies 136 Note 27 - Related Party Transactions 136 Note 28 - Subsequent Events 136 82 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Independent auditors’ report to the members of Diversified Energy Company PLC Report on the audit of the financial statements Opinion In our opinion: • Diversified Energy Company PLC’s group financial statements and company financial statements (the “financial statements”) give a true and fair view of the state of the group’s and of the company’s affairs as at 31 December 2024 and of the group’s loss and the group’s cash flows for the year then ended; • the group financial statements have been properly prepared in accordance with UK-adopted international accounting standards as applied in accordance with the provisions of the Companies Act 2006; • the company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, including FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland”, and applicable law); and • the financial statements have been prepared in accordance with the requirements of the Companies Act 2006. We have audited the financial statements, included within the 2024 Annual Report (the “Annual Report”), which comprise: the Consolidated and Company Statements of Financial Position as at 31 December 2024; the Consolidated Statement of Comprehensive Income, the Consolidated and Company Statements of Changes in Equity and the Consolidated Statement of Cash Flows for the year then ended; and the notes to the financial statements, comprising material accounting policy information and other explanatory information. Our opinion is consistent with our reporting to the Audit and Risk Committee. Separate opinion in relation to IFRSs as issued by the IASB As explained in note 2 to the group financial statements, the group, in addition to applying UK-adopted international accounting standards, has also applied international financial reporting standards (IFRSs) as issued by the International Accounting Standards Board (IASB). In our opinion, the group financial statements have been properly prepared in accordance with IFRSs as issued by the IASB. Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors’ responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We remained independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC’s Ethical Standard, as applicable to listed public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. To the best of our knowledge and belief, we declare that non-audit services prohibited by the FRC’s Ethical Standard were not provided. Other than those disclosed in note 7 to the group financial statements, we have provided no non-audit services to the company or its controlled undertakings in the period under audit. 83 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Our audit approach Overview Audit scope • The group’s assets and operations are based in the Appalachian and Central regions of the USA. Consistent with prior year, we conducted a full scope audit over the consolidated group, treating this as one component including the parent company, in line with how the group is managed and the organisation of the group’s financial reporting system. Financial reporting is undertaken for the consolidated group at the head office in Birmingham, Alabama. Key audit matters • Accounting for acquisitions of gas and oil properties (group) • Carrying value of investments in subsidiaries (company) Materiality • Overall group materiality: $11.0m (2023: $13.4m) based on approximately 2.5% of adjusted EBITDA. • Overall company materiality: £10.7m (2023: £9.5m) based on 1% of total assets. • Performance materiality: $8.25m (2023: $10.1m) (group) and £8.0m (2023: £7.1m) (company). The scope of our audit As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements. Key audit matters Key audit matters are those matters that, in the auditors’ professional judgement, were of most significance in the audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by the auditors, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters, and any comments we make on the results of our procedures thereon, were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. This is not a complete list of all risks identified by our audit. The key audit matters below are consistent with last year. 84 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Key audit matter How our audit addressed the key audit matter Accounting for acquisitions of gas and oil properties (group) Refer to note 3, note 4 and note 5 of the group financial statements. Accounting for significant acquisitions is complex and involves judgement to determine whether the acquisition is a business combination or not, and in the assessment of the fair value of assets acquired and liabilities assumed and as such this was an area of focus for us. During 2024, the group completed three significant acquisitions: • In the Oaktree acquisition, the company acquired the remaining proportionate interests of wells acquired alongside Oaktree Capital Management, L.P. in the East Texas, Tapstone, Tanos, and Indigo acquisitions. Total consideration was $221.7m inclusive of cash consideration and the acquired debt. • In the Crescent Pass acquisition, the company acquired certain upstream assets and related infrastructure in the Central region. Total consideration was $97.7m consisting of a combination of shares and cash. • In the East Texas II acquisition, the company acquired certain producing assets in the Central region. Total consideration was $67.8m consisting of a combination of shares and cash. IFRS 3 (amended), ‘Business Combinations’ permits an optional concentration test that, if met, allows an entity to account for the acquisition as an asset acquisition rather than as a business combination. In relation to the Crescent Pass acquisition, the initial value of the gross assets acquired is largely attributable to the proved developed wells which are considered similar in nature and therefore can be treated as a group of similar identifiable assets in the concentration test. Based on the terms of the concentration test, this has been determined as an asset acquisition. In relation to the East Texas II and Oaktree acquisitions, management assessed the qualitative factors in IFRS 3. As the assets acquired will be operated by the group’s existing operational and marketing team, management determined that no substantive process has been acquired, and as such the transactions have been determined to be asset acquisitions. As the three acquisitions have been accounted for as asset acquisitions, the consideration is attributed to the acquired assets and liabilities, respectively. Acquisition costs have also been capitalised as part of the cost of the respective assets. Our audit procedures in respect of the acquisitions comprised the following: • Reading the sale and purchase agreements to gain an understanding of the assets acquired, liabilities assumed and the overall nature of the transactions; • Considering whether the accounting for each acquisition is in accordance with IFRS 3, specifically that the Crescent Pass acquisition met the optional concentration test permitting the acquisition to be accounted for as an asset acquisition; and in the case of Oaktree and East Texas II, that a substantive process had not been acquired and therefore the acquisitions did not meet the definition of a business combination; • Agreeing cash consideration to bank statements and confirming the issuance of the consideration shares; and • Assessing the reasonableness of the allocation of the purchase consideration to the gas and oil properties and other assets acquired based on their relative fair value, and substantively testing the assets and liabilities acquired. Based on our procedures, we consider the accounting for the acquisitions and the related valuation of the gas and oil properties and other assets acquired, and liabilities assumed, to be reasonable. We also reviewed the related disclosures in the notes to the financial statements for compliance with accounting standards and consistency with the results of our work, with no matters arising. 85 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Carrying value of investments in subsidiaries (company) Refer to note 2, note 3 and note 4 of the company financial statements. The determination of whether indicators of impairment exist can involve significant judgement. Where an indicator of impairment is identified, an impairment assessment must be performed. Impairment assessments require significant judgement and estimation, therefore this was a key area of focus for our audit due to the size of the investments balance. The company has investments in subsidiaries of £1,077.2m. The directors determined the recoverable amount of the investments and compared this to the carrying value and concluded that no impairment was required. We obtained management’s impairment assessment of the investments in subsidiaries and: • Verified that the key inputs to the assessment were appropriate in the context of the underlying subsidiaries and the evidence obtained; and • Compared the carrying value of the investments to the recoverable amounts of the underlying assets. Based on our procedures, we concur that the carrying value of the investments in subsidiaries is supportable. We also consider the associated disclosures to be appropriate. How we tailored the audit scope We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements as a whole, taking into account the structure of the group and the company, the accounting processes and controls, and the industry in which they operate. The group’s assets and operations are based in the Appalachian and Central regions of the USA. Financial reporting is undertaken at the head office in Birmingham, Alabama. For our audit of the group financial statements, we identified one component being the consolidated group. In establishing the overall approach to the group audit, we determined the type of work that needed to be performed by us, as the group audit team, or by our PwC component audit team in the USA operating under our instruction. In determining our audit scope, we considered our overall assessment of risk and materiality, and the overall coverage obtained over each material line item in the group financial statements. We determined that the consolidated group component required an audit of its complete financial information. Audit work on the consolidated group was carried out by our US component audit team. As we identified only one component, the components where we performed our audit work accounted for 100% of the group's consolidated financial statements. Where the work was performed by the component audit team, we determined the level of involvement we needed to ensure sufficient appropriate audit evidence had been obtained as a basis for our opinion on the group financial statements as a whole. We spent time with our component team in Birmingham, Alabama during the planning, interim and execution phases of the audit. In addition to these site visits we conducted our oversight of our component audit team through regular dialogue via conference calls, video conferencing and other forms of communication as considered necessary. We performed remote and in-person working paper reviews to satisfy ourselves as to the appropriateness of audit work performed by our component audit team. We also attended key meetings virtually and in person with local management and our component audit team. This work, together with the additional procedures performed by us as the group team, including review of the Annual Report and financial statements and testing of disclosures, gave us the evidence we needed for our opinion on the group financial statements as a whole. The audit of the company's financial statements was conducted from the UK by the group audit team. The impact of climate risk on our audit As part of our audit, we made enquiries of management to understand their process to assess the extent of the potential impact of climate change risks on the group and its financial statements. We used our knowledge of the group to consider the completeness of the risk assessment performed by management, giving consideration to both physical and transition risks, and management’s own public reporting and announcements. Management has outlined in the Strategic Report their ESG and sustainability goals, continuing to highlight a focus on a reduction in methane intensity in the short-term and an ambition to further improve their net zero scope 1 and scope 2 carbon position over the longer term. These goals have been modelled in the current financial reporting, although management is continuing to develop its pathway to deliver on these goals and will model any further impact as the pathway is finalised. 86 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Whilst the impact is uncertain, we particularly considered the impact of both physical and transition risks arising due to climate change, as well as the climate targets announced by the group on the recoverable value of the group’s gas and oil properties. We concur with management’s assessment that there are no indications that the useful lives of those properties had been impacted by climate change. We also read the disclosures made in relation to climate change in the other information within the Annual Report, and considered their consistency with the financial statements and our knowledge from our audit. Materiality The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole. Based on our professional judgement, we determined materiality for the financial statements as a whole as follows: Financial statements - group Financial statements - company Overall materiality $11.0m (2023: $13.4m). £10.7m (2023: £9.5m). How we determined it Approximately 2.5% of adjusted EBITDA 1% of total assets Rationale for benchmark applied We have concluded that adjusted EBITDA is the most appropriate benchmark as it is a primary measure used by shareholders in assessing the performance of the group. The adjusted EBITDA measure removes the impact of significant items which do not recur from year to year or which otherwise significantly affect the underlying trend of performance from continuing operations. This is the metric against which the performance of the group is most commonly assessed by the directors and reported to shareholders. We have assessed that the most appropriate benchmark for the company, which is primarily a holding company, is total assets. We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope of our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example in determining sample sizes. Our performance materiality was 75% (2023: 75%) of overall materiality, amounting to $8.25m (2023: $10.1m) for the group financial statements and £8.0m (2023: £7.1m) for the company financial statements. In determining the performance materiality, we considered a number of factors - the history of misstatements, risk assessment and aggregation risk and the effectiveness of controls - and concluded that an amount at the upper end of our normal range was appropriate. We agreed with the Audit and Risk Committee that we would report to them misstatements identified during our audit above $0.55m (group audit) (2023: $0.67m) and £0.54m (company audit) (2023: £0.47m) as well as misstatements below those amounts that, in our view, warranted reporting for qualitative reasons. Conclusions relating to going concern Our evaluation of the directors’ assessment of the group's and the company’s ability to continue to adopt the going concern basis of accounting included: • Obtaining and examining management’s base case forecast and downside scenarios for the group (which includes the company as the company's ability to continue as a going concern is linked to the going concern of the group) and checking that the forecasts have been subject to board review and approval; • Considering the historical reliability of management forecasting by comparing budgeted results with actual performance; 87 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements • Understanding and assessing the reasonableness of the key assumptions used in the cash flow forecasts, including assessing whether we considered the downside sensitivities to be appropriately severe, the availability of committed finance and covenant compliance during the forecast period; • Corroborating key assumptions in the cash flow forecasts to other evidence including historical performance, and ensuring these are consistent with our audit work in these and other areas, and in doing so assessing whether management's conclusions were supportable; and • Reading and evaluating the adequacy of the disclosures made in the financial statements related to going concern. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and the company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements is appropriate. However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the group's and the company's ability to continue as a going concern. In relation to the directors’ reporting on how they have applied the UK Corporate Governance Code, we have nothing material to add or draw attention to in relation to the directors’ statement in the financial statements about whether the directors considered it appropriate to adopt the going concern basis of accounting. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. Reporting on other information The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities. With respect to the Strategic Report and Directors' Report, we also considered whether the disclosures required by the UK Companies Act 2006 have been included. Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below. Strategic Report and Directors' Report In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic Report and Directors' Report for the year ended 31 December 2024 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements. In light of the knowledge and understanding of the group and company and their environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic Report and Directors' Report. Directors' Remuneration In our opinion, the part of the Remuneration Committee's Report to be audited has been properly prepared in accordance with the Companies Act 2006. Corporate governance statement The Listing Rules require us to review the directors’ statements in relation to going concern, longer-term viability and that part of the corporate governance statement relating to the company’s compliance with the provisions of the UK Corporate Governance Code 88 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements specified for our review. Our additional responsibilities with respect to the corporate governance statement as other information are described in the Reporting on other information section of this report. Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate governance statement is materially consistent with the financial statements and our knowledge obtained during the audit, and we have nothing material to add or draw attention to in relation to: • The directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks; • The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify emerging risks and an explanation of how these are being managed or mitigated; • The directors’ statement in the financial statements about whether they considered it appropriate to adopt the going concern basis of accounting in preparing them, and their identification of any material uncertainties to the group’s and company’s ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements; • The directors’ explanation as to their assessment of the group's and company’s prospects, the period this assessment covers and why the period is appropriate; and • The directors’ statement as to whether they have a reasonable expectation that the company will be able to continue in operation and meet its liabilities as they fall due over the period of its assessment, including any related disclosures drawing attention to any necessary qualifications or assumptions. Our review of the directors’ statement regarding the longer-term viability of the group and company was substantially less in scope than an audit and only consisted of making inquiries and considering the directors’ process supporting their statement; checking that the statement is in alignment with the relevant provisions of the UK Corporate Governance Code; and considering whether the statement is consistent with the financial statements and our knowledge and understanding of the group and company and their environment obtained in the course of the audit. In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate governance statement is materially consistent with the financial statements and our knowledge obtained during the audit: • The directors’ statement that they consider the Annual Report, taken as a whole, is fair, balanced and understandable, and provides the information necessary for the members to assess the group’s and company's position, performance, business model and strategy; • The section of the Annual Report that describes the review of effectiveness of risk management and internal control systems; and • The section of the Annual Report describing the work of the Audit and Risk Committee. We have nothing to report in respect of our responsibility to report when the directors’ statement relating to the company’s compliance with the Code does not properly disclose a departure from a relevant provision of the Code specified under the Listing Rules for review by the auditors. Responsibilities for the financial statements and the audit Responsibilities of the directors for the financial statements As explained more fully in the Statement of Directors' Responsibilities in Respect of the Financial Statements, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the group’s and the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the company or to cease operations, or have no realistic alternative but to do so. Auditors’ responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. 89 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below. Based on our understanding of the group and industry, we identified that the principal risks of non-compliance with laws and regulations related to compliance with environmental legislation, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006 and UK and US federal and state tax legislation. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries to manipulate adjusted EBITDA and management bias in key accounting estimates. The group engagement team shared this risk assessment with the component auditors so that they could include appropriate audit procedures in response to such risks in their work. Audit procedures performed by the group engagement team and/or component auditors included: • Enquiries of directors, management, staff in the group’s tax function and the group's legal counsel, including consideration of known or suspected instances or non-compliance with laws and regulations and fraud; • Evaluation of controls designed to prevent and detect irregularities; • Challenging assumptions and judgements made by management in respect of significant accounting judgements and estimates, and assessing these judgements and estimates for management bias; • Reviewing significant and/or unusual transactions during the year; • Reviewing minutes of meetings of those charged with governance; • Reviewing internal audit reports; • Identifying and testing journal entries based on our risk assessment, in particular any journal entries posted with unusual account combinations. There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non- compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. Our audit testing might include testing complete populations of certain transactions and balances, possibly using data auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than testing complete populations. We will often seek to target particular items for testing based on their size or risk characteristics. In other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the sample is selected. A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors’ report. Use of this report This report, including the opinions, has been prepared for and only for the company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing. Other required reporting Companies Act 2006 exception reporting Under the Companies Act 2006 we are required to report to you if, in our opinion: •we have not obtained all the information and explanations we require for our audit; or •adequate accounting records have not been kept by the company, or returns adequate for our audit have not been received from branches not visited by us; or •certain disclosures of directors’ remuneration specified by law are not made; or •the company financial statements and the part of the Remuneration Committee's Report to be audited are not in agreement with the accounting records and returns. We have no exceptions to report arising from this responsibility. 90 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Appointment Following the recommendation of the Audit and Risk Committee, we were appointed by the members on 15 April 2020 to audit the financial statements for the year ended 31 December 2020 and subsequent financial periods. The period of total uninterrupted engagement is 5 years, covering the years ended 31 December 2020 to 31 December 2024. Other matter The company is required by the Financial Conduct Authority Disclosure Guidance and Transparency Rules to include these financial statements in an annual financial report prepared under the structured digital format required by DTR 4.1.15R - 4.1.18R and filed on the National Storage Mechanism of the Financial Conduct Authority. This auditors’ report provides no assurance over whether the structured digital format annual financial report has been prepared in accordance with those requirements. Kevin McGhee (Senior Statutory Auditor) for and on behalf of PricewaterhouseCoopers LLP Chartered Accountants and Statutory Auditors London 17 March 2025 91 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Consolidated Statement of Comprehensive Income (Amounts in thousands, except share, per share and per unit data) Year Ended Notes December 31, 2024 December 31, 2023 December 31, 2022 Revenue 6 $794,841 $868,263 $1,919,349 Operating expenses 7 (428,902) (440,562) (445,893) Depreciation, depletion and amortization 7 (256,484) (224,546) (222,257) Gross profit $109,455 $203,155 $1,251,199 General and administrative expenses 7 (129,119) (119,722) (170,735) Allowance for expected credit losses 7 (101) (8,478) — Gain (loss) on natural gas and oil properties and equipment 10, 11 25,678 24,146 2,379 Gain (loss) on sale of equity interest 5 (7,375) 18,440 — Unrealized gain (loss) on investment 5 (4,013) 4,610 — Gain (loss) on derivative financial instruments 13 (37,551) 1,080,516 (1,758,693) Gain on bargain purchases 5 — — 4,447 Impairment of proved properties 10 — (41,616) — Operating profit (loss) $(43,026) $1,161,051 $(671,403) Finance costs 21 (137,643) (134,166) (100,799) Accretion of asset retirement obligation 19 (30,868) (26,926) (27,569) Loss on early retirement of debt 21 (14,753) — — Other income (expense) 2,338 385 269 Income (loss) before taxation $(223,952) $1,000,344 $(799,502) Income tax benefit (expenses) 8 136,951 (240,643) 178,904 Net income (loss) $(87,001) $759,701 $(620,598) Other comprehensive income (loss) (1,822) (270) 940 Total comprehensive income (loss) $(88,823) $759,431 $(619,658) Net income (loss) attributable to: Owners of Diversified Energy Company PLC $(88,272) $758,018 $(625,410) Non-controlling interest 1,271 1,683 4,812 Net income (loss) $(87,001) $759,701 $(620,598) Earnings (loss) per share attributable to Owners of Diversified Energy Company PLC Weighted average shares outstanding - basic 9 48,031,916 47,165,380 42,203,974 Weighted average shares outstanding - diluted 9 48,031,916 47,514,521 42,203,974 Earnings (loss) per share - basic 9 $(1.84) $16.07 $(14.82) Earnings (loss) per share - diluted 9 $(1.84) $15.95 $(14.82) The notes on pages 95 to 136 are an integral part of the Group Financial Statements. 92 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Consolidated Statement of Financial Position (Amounts in thousands, except share, per share and per unit data) Notes December 31, 2024 December 31, 2023 ASSETS Non-current assets: Natural gas and oil properties, net 10 $2,905,702 $2,490,375 Property, plant and equipment, net 11 449,540 456,208 Intangible assets 12 15,180 19,351 Restricted cash 3 34,843 25,057 Derivative financial instruments 13 28,439 24,401 Deferred tax assets 8 259,287 144,860 Other non-current assets 15 6,270 9,172 Total non-current assets 3,699,261 3,169,424 Current assets: Trade receivables, net 14 $234,421 $190,207 Cash and cash equivalents 3 5,990 3,753 Restricted cash 3 11,426 11,195 Derivative financial instruments 13 33,759 87,659 Other current assets 15 18,668 11,784 Total current assets 304,264 304,598 Total assets $4,003,525 $3,474,022 EQUITY AND LIABILITIES Shareholders' equity: Share capital 16 $13,762 $12,897 Share premium 16 1,262,711 1,208,192 Treasury reserve (119,006) (102,470) Share based payment and other reserves 20,170 14,442 Retained earnings (accumulated deficit) (724,960) (547,255) Equity attributable to Owners of Diversified Energy Company PLC: 452,677 585,806 Non-controlling interests 3 11,879 12,604 Total equity 464,556 598,410 Non-current liabilities: Asset retirement obligations 19 $642,142 $501,246 Leases 20 30,824 20,559 Borrowings 21 1,483,779 1,075,805 Deferred tax liability 8 8,011 13,654 Derivative financial instruments 13 608,869 623,684 Other non-current liabilities 23 5,384 2,224 Total non-current liabilities 2,779,009 2,237,172 Current liabilities: Trade and other payables 22 $35,013 $53,490 Taxes payable 33,498 50,226 Leases 20 13,776 10,563 Borrowings 21 209,463 200,822 Derivative financial instruments 13 163,676 45,836 Other current liabilities 23 304,534 277,503 Total current liabilities 759,960 638,440 Total liabilities 3,538,969 2,875,612 Total equity and liabilities $4,003,525 $3,474,022 The notes on pages 95 to 136 are an integral part of the Group Financial Statements. The Group Financial Statements were approved and authorized for issue by the Board on March 17, 2025 and were signed on its behalf by: David E. Johnson Chairman of the Board March 17, 2025 93 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Consolidated Statement of Changes in Equity (Amounts in thousands, except share, per share and per unit data) Notes Share Capital Share Premium Treasury Reserve Share Based Payment and Other Reserves Retained Earnings (Accumulated Deficit) Equity Attributable to Owners of Diversified Energy Company PLC Non- Controlling Interest Total Equity Balance as of January 1, 2022 $11,571 $1,052,959 $(68,537) $14,156 $(362,740) $647,409 $16,541 $663,950 Net income (loss) — — — — (625,410) (625,410) 4,812 (620,598) Other comprehensive income (loss) — — — — 940 940 — 940 Total comprehensive income (loss) $— $— $— $— $(624,470) $(624,470) $4,812 $(619,658) Issuance of share capital (settlement of warrants) 16 5 — — 452 — 457 — 457 Issuance of share capital (equity compensation) 7 — — 5,682 (3,307) 2,382 — 2,382 Issuance of EBT shares (equity compensation) 16 — — 2,400 (2,400) — — — — Repurchase of shares (EBT) 16 — — (22,931) — — (22,931) — (22,931) Repurchase of shares (share buyback program) 16 (80) — (11,760) 80 — (11,760) — (11,760) Dividends 18 — — — — (143,455) (143,455) — (143,455) Distributions to non-controlling interest owners — — — — — — (6,389) (6,389) Cancellation of warrants 16 — — — (320) — (320) — (320) Transactions with shareholders $(68) $— $(32,291) $3,494 $(146,762) $(175,627) $(6,389) $(182,016) Balance as of December 31, 2022 $11,503 $1,052,959 $(100,828) $17,650 $(1,133,972) $(152,688) $14,964 $(137,724) Net income (loss) — — — — 758,018 758,018 1,683 759,701 Other comprehensive income (loss) — — — — (270) (270) — (270) Total comprehensive income (loss) $— $— $— $— $757,748 $757,748 $1,683 $759,431 Issuance of share capital (equity placement) 16 1,555 155,233 — — — 156,788 — 156,788 Issuance of share capital (equity compensation) — — — 6,037 (2,990) 3,047 — 3,047 Issuance of EBT shares (equity compensation) 16 — — 9,406 (9,406) — — — — Repurchase of shares (share buyback program) 16 (161) — (11,048) 161 — (11,048) — (11,048) Dividends 18 — — — — (168,041) (168,041) — (168,041) Distributions to non-controlling interest owners — — — — — — (4,043) (4,043) Transactions with shareholders $1,394 $155,233 $(1,642) $(3,208) $(171,031) $(19,254) $(4,043) $(23,297) Balance as of December 31, 2023 $12,897 $1,208,192 $(102,470) $14,442 $(547,255) $585,806 $12,604 $598,410 Net income (loss) — — — — (88,272) (88,272) 1,271 (87,001) Other comprehensive income (loss) — — — — (1,822) (1,822) — (1,822) Total comprehensive income (loss) $— $— $— $— $(90,094) $(90,094) $1,271 $(88,823) Issuance of share capital (acquisition consideration) 16 1,185 54,519 — — — 55,704 — 55,704 Issuance of share capital (equity compensation) — — — 10,002 (3,747) 6,255 — 6,255 Issuance of EBT shares (equity compensation) 16 — — 4,594 (4,594) — — — — Repurchase of shares (EBT) 16 — — (5,229) — — (5,229) — (5,229) Repurchase of shares (share buyback program) 16 (320) — (15,901) 320 — (15,901) — (15,901) Dividends 18 — — — — (83,864) (83,864) — (83,864) Distributions to non-controlling interest owners — — — — — — (1,996) (1,996) Transactions with shareholders $865 $54,519 $(16,536) $5,728 $(87,611) $(43,035) $(1,996) $(45,031) Balance as of December 31, 2024 $13,762 $1,262,711 $(119,006) $20,170 $(724,960) $452,677 $11,879 $464,556 The notes on pages 95 to 136 are an integral part of the Group Financial Statements . 94 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Consolidated Statement of Cash Flows (Amounts in thousands, except share, per share and per unit data) Year Ended Notes December 31, 2024 December 31, 2023 December 31, 2022 Cash flows from operating activities: Net income (loss) $(87,001) $759,701 $(620,598) Cash flows from operations reconciliation: Depreciation, depletion and amortization 7 256,484 224,546 222,257 Accretion of asset retirement obligations 19 30,868 26,926 27,569 Impairment of proved properties 10 — 41,616 — Income tax (benefit) expense 8 (136,951) 240,643 (178,904) (Gain) loss on fair value adjustments of unsettled financial instruments 13 189,030 (905,695) 861,457 Asset retirement costs 19 (8,375) (5,961) (4,889) (Gain) loss on natural gas and oil properties and equipment 5,10,11 (25,678) (24,146) (2,379) (Gain) loss on sale of equity interest 5 7,375 (18,440) — Unrealized (gain) loss on investment 5 4,013 (4,610) — Gain on bargain purchases 5 — — (4,447) Finance costs 21 137,643 134,166 100,799 Loss on early retirement of debt 21 14,753 — — Hedge modifications 13 — 26,686 (133,573) Non-cash equity compensation 17 8,286 6,494 8,051 Working capital adjustments: Change in trade receivables and other current assets (27,555) 104,571 13,760 Change in other non-current assets (923) 1,661 (580) Change in trade and other payables and other current liabilities (6,204) (183,530) 132,349 Change in other non-current liabilities 1,319 (6,236) (6,794) Cash generated from operations $357,084 $418,392 $414,078 Cash paid for income taxes (11,421) (8,260) (26,314) Net cash provided by operating activities $345,663 $410,132 $387,764 Cash flows from investing activities: Consideration for business acquisitions, net of cash acquired 5 $— $— $(24,088) Consideration for asset acquisitions 5 (288,489) (262,329) (264,672) Proceeds from divestitures 5 59,048 95,749 — Expenditures on natural gas and oil properties and equipment 10, 11 (52,100) (74,252) (86,079) Proceeds on disposals of natural gas and oil properties and equipment 10, 11 9,675 4,083 12,189 Deferred consideration payments 5 (1,050) (2,620) — Contingent consideration payments 24 — — (23,807) Net cash used in investing activities $(272,916) $(239,369) $(386,457) Cash flows from financing activities: Repayment of borrowings 21 $(1,653,489) $(1,547,912) $(2,139,686) Proceeds from borrowings 21 1,844,768 1,537,230 2,587,554 Prepayment charge on early retirement of debt 21 (1,752) — — Cash paid for interest 21 (123,141) (116,784) (83,958) Debt issuance costs 21 (20,267) (13,776) (34,234) Decrease (increase) in restricted cash 3 (3,864) 11,792 (36,287) Hedge modifications associated with ABS Notes 13, 21 — (6,376) (105,316) Proceeds from equity issuance, net 16 — 156,788 — Proceeds from lease modifications 20 8,568 — — Principal element of lease payments 20 (14,343) (12,169) (10,211) Cancellation (settlement) of warrants, net 16 — — 137 Dividends to shareholders 18 (83,864) (168,041) (143,455) Distributions to non-controlling interest owners 3 (1,996) (4,043) (6,389) Repurchase of shares by the EBT 16 (5,229) — (22,931) Repurchase of shares 16 (15,901) (11,048) (11,760) Net cash used in financing activities $(70,510) $(174,339) $(6,536) Net change in cash and cash equivalents 2,237 (3,576) (5,229) Cash and cash equivalents, beginning of period 3,753 7,329 12,558 Cash and cash equivalents, end of period $5,990 $3,753 $7,329 The notes on pages 95 to 136 are an integral part of the Group Financial Statements . 95 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Notes to the Group Financial Statements (Amounts in thousands, except share, per share and per unit data) Note 1 - General Information (Amounts in thousands, except share, per share and per unit data) Diversified Energy Company PLC (the “Parent” or “Company”), and its wholly owned subsidiaries (the “Group”) is an independent energy company engaged in the production, transportation and marketing of primarily natural gas related to its synergistic U.S. onshore upstream and midstream assets. The Group’s assets are located within the Appalachian Region and Central Region in the U.S . The Company was incorporated on July 31, 2014 in the United Kingdom and is registered in England and Wales under the Companies Act 2006 as a public limited company under company number 09156132. The Group‘s registered office is located at 4th floor Phoenix House, 1 Station Hill, Reading, Berkshire, RG1 1NB, UK. In May 2020, the Company’s shares were admitted to trading on the LSE’s Main Market for listed securities under the ticker “DEC”. In December 2023, the Company’s shares were admitted to trading on the New York Stock Exchange (“NYSE”) under the ticker “DEC.” As of December 31, 2024, the principal trading market for the Company’s ordinary shares was the LSE. Note 2 - Basis of Preparation (Amounts in thousands, except share, per share and per unit data) Basis of Preparation The Group's consolidated financial statements (the “ Group Financial Statements ”) have been prepared in accordance with United Kingdom adopted International Accounting Standards (“IAS”) and International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) and in accordance with the provisions of the UK Companies Act 2006 as applicable to companies reporting under those standards. IFRS as adopted by the UK as applied to the Group’s financial statements differs in certain respects from IFRS as issued by the IASB. The differences have no impact on the Group’s consolidated financial statements for the years presented. The principal accounting policies set out below have been applied consistently throughout the year and are consistent with prior year unless otherwise stated. Unless otherwise stated, the Group Financial Statements are presented in U.S. Dollars, which is the Group’s subsidiaries’ functional currency and the currency of the primary economic environment in which the Group operates, and all values are rounded to the nearest thousand dollars except share, per share and per unit amounts and where otherwise indicated. Transactions in foreign currencies are translated into U.S. Dollars at the rate of exchange on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate at the date of the Consolidated Statement of Financial Position. Where the Group’s subsidiaries have a different functional currency, their results and financial position are translated into the presentation currency as follows: • Assets and liabilities in the Consolidated Statement of Financial Position are translated at the closing rate at the date of that Consolidated Statement of Financial Position; • Income and expenses in the Consolidated Statement of Comprehensive Income are translated at average exchange rates (unless this is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and • All resulting exchange differences are reflected within other comprehensive income in the Consolidated Statement of Comprehensive Income. The Group Financial Statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets and liabilities (including derivative instruments) held at fair value through profit or loss or through other comprehensive income. Segment Reporting The Group is an independent owner and operator of producing natural gas and oil wells with properties located in the states of Tennessee, Kentucky, Virginia, West Virginia, Ohio, Pennsylvania, Oklahoma, Texas and Louisiana. The Group’s strategy is to acquire long-life producing assets, efficiently operate those assets to generate free cash flow for shareholders and then to retire assets safely and responsibly at the end of their useful life. The Group’s assets consist of natural gas and oil wells, pipelines and a network of gathering lines and compression facilities which are complementary to the Group’s assets. In accordance with IFRS the Group establishes segments on the basis on which those components of the Group are evaluated regularly by the chief executive officer, the Group’s chief operating decision maker (“CODM”), when deciding how to allocate resources and in assessing performance. When evaluating performance as well as when acquiring and managing assets the CODM does so in a consolidated and complementary fashion to vertically integrate and improve margins. Accordingly, when determining operating segments under IFRS 8, the Group has identified one reportable segment that produces and transports natural gas, NGLs and oil in the U.S. Going Concern The Group Financial Statements have been prepared on the going concern basis, assuming the continuation of normal business activities, the realization of assets, and the settlement of liabilities in the ordinary course of business. After reviewing the Group’s overall position and outlook, the Directors believe that the Group is adequately funded to continue operating as a going concern for at least the next twelve months from the date of approval of this Annual Report. The Directors diligently oversee and manage the Group’s liquidity risk. While our financial outlook is primarily evaluated through the annual business planning process, it is also closely monitored on a monthly basis. This involves regular Board discussions, led by senior leadership, to assess the Group’s current performance and future outlook. The business planning process produces key performance objectives, an assessment of the Group’s primary risks, the anticipated operational outlook, and a set of financial forecasts that consider the available funding sources (the “Base Plan”). The Base Plan was formed on key assumptions that support the business planning process. These assumptions include: • Projected operating cash flows are calculated based on a production profile that aligns with current operating results and observed decline rates; • Assumes commodity prices align with the current forward curve, taking into account basis differentials; 96 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements • Operating cost levels remain consistent with historical trends; • The financial impact of our current hedging contracts for the assessment period, covering approximately 86% and 82% of total production volumes for the years ending December 31, 2025 and 2026, respectively; and • The scenario also accounts for the scheduled principal and interest payments on our existing debt arrangements. The Directors and management also evaluate various scenarios around the Base Plan, focusing on more severe but plausible downside impacts of the principal risks, both individually and collectively. They also consider the additional capital requirements these downside scenarios might impose. These scenarios include: Scenario 1: Cyclically low gas prices for a year, with Henry Hub prices at $2.00 per MMbtu before returning to strip pricing, reflecting historically observed market conditions. Scenario 2: Considered the impact of climate change by assuming a two -week period of lost production in our East Texas/Louisiana region, which is prone to hurricanes, due to a natural disaster (assumed to occur once each year during the assessment period). Scenario 3: Considered the impact of climate change by assuming a two-week period of lost production in our Appalachian region (assumption of lost production affecting 25% of the region), which is prone to flooding, due to a natural disaster (assumed to occur once each year during the assessment period). Under these downside sensitivity scenarios, the Group continues to meet its working capital requirements, primarily consisting of derivative liabilities. These liabilities, when settled, will be funded using the higher commodity revenues from which they were derived. Additionally, the Group will continue to meet the covenant requirements under its Credit Facility and other existing borrowing instruments. The Directors and management assess the potential impact of these principal risks on the Group’s prospects within the assessment period and evaluate opportunities to actively mitigate the risk of these severe but plausible downside scenarios. In addition to modeling downside going concern scenarios, the Board has stress-tested the model to determine the extent of downturn that would result in a breach of covenants. Assuming similar levels of cash conversion as seen in 2024, a significant decline in production volume and pricing, well beyond historical experiences, would need to persist throughout the going concern period for a covenant breach to occur, which is considered very unlikely. In addition to the scenarios mentioned, the Directors also considered the current geopolitical environment and the inflationary pressures affecting the U.S., which the Group is closely monitoring. Despite modeling specific hypothetical scenarios, the Group believes that the impact of these events will largely continue to be reflected in commodity markets, extending the recent volatility. The Group views commodity price risk a principal risk and will continue to actively monitor and mitigate this risk through its hedging program. Based on this assessment, the Directors have reviewed the Group’s overall position and outlook and believe that the Group is sufficiently funded to operate as a going concern for the next twelve months from the date of approval of the Group Financial Statements. Basis of Consolidation Group companies included in the Group Financial Statements for the year ended December 31, 2024 are Parent and all subsidiary undertakings, which are those entities controlled by the Parent. Control exists when the Group has the power to direct the activities of an entity so as to affect the return on investment. The net assets and results of acquired businesses are included in the Group Financial Statements from their respective dates of acquisition, being the date on which the Group obtains control. The results of disposed businesses are included in the consolidated financial statements up to their date of disposal, being the date control ceases. Intra-Group transactions and balances are eliminated. The Group Financial Statements for the year ended December 31, 2024 reflect the following corporate structure of the Group, and its wholly owned subsidiaries: • Diversified Energy Company PLC (“DEC”) as well as its wholly owned subsidiaries • Diversified Gas & Oil Corporation • Diversified Production LLC • Diversified ABS Holdings LLC • Diversified ABS LLC • Diversified ABS Phase II Holdings LLC • Diversified ABS Phase II LLC • Diversified ABS Phase IV Holdings LLC • Diversified ABS Phase IV LLC • DP Bluegrass Holdings LLC • DP Bluegrass LLC • Chesapeake Granite Wash Trust(a) • BlueStone Natural Resources II, LLC • Sooner State Joint ABS Holdings LLC(b) • Diversified ABS Phase VI Holdings LLC • Diversified ABS Phase VI LLC • Diversified ABS VI Upstream LLC • Oaktree ABS VI Upstream LLC • DP Lion Equity Holdco LLC(c) • DP Lion Holdco LLC • Diversified ABS VIII Holdings LLC • Diversified ABS VIII LLC • Diversified ABS III Upstream LLC • Diversified ABS V Upstream LLC • DP Yellowjacket Equity Holdco LLC • DP Yellowjacket Holdco LLC • DM Yellowjacket Holdco LLC • Tanos TX Holdco LLC • Diversified ABS IX Holdings LLC • Diversified Mustang Holdco LLC • DP RBL Co LLC • DP Legacy Central LLC • Diversified Energy Marketing, LLC • OCM Denali Holdings, LLC • DP Tapstone Energy Holdings, LLC • DP Legacy Tapstone LLC • Giant Land, LLC (d) • Link Land, LLC(d) • Old Faithful Land, LLC(d) • Riverside Land, LLC(d) • Splendid Land, LLC(d) • Diversified Midstream LLC • Cranberry Pipeline Corporation • Coalfield Pipeline Company • DM Bluebonnet LLC • Black Bear Midstream Holdings LLC • Black Bear Midstream LLC • Black Bear Liquids LLC • Black Bear Liquids Marketing LLC • DM Pennsylvania Holdco LLC • Diversified Energy Group LLC • Diversified Energy Company LLC • Next LVL Energy, LLC • Diversified ABS IX Holdings LLC • Diversified ABS X Holdings LLC • Diversified ABS X LLC (a) Diversified Production, LLC holds 50.8% of the issued and outstanding common shares of Chesapeake Granite Wash Trust. (b) Owned 51.25% by Diversified Production LLC and 48.75% by OCM Denali Holdings LLC, both wholly owned subsidiaries of the Group. 97 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements (c) Diversified Production, LLC holds 20% of the issued and outstanding equity of DP Lion Equity Holdco LLC. This entity is not consolidated within the Group’s financial statements as of December 31, 2024. Refer to Note 5 for additional information. (d) Owned approximately 55% by Diversified Energy Company PLC. Note 3 - Material Accounting Policies (Amounts in thousands, except share, per share and per unit data) The preparation of the Group Financial Statements in compliance with UK-adopted IAS and IFRS as issued by the IASB requires management to make estimates and exercise judgment in applying the Group’s accounting policies. In preparing the Group Financial Statements , the significant judgments made by management in applying the Group’s accounting policies and the key sources of estimation uncertainty are disclosed in Note 4. Business Combinations and Asset Acquisitions The Group performs an assessment of each acquisition to determine whether the acquisition should be accounted for as an asset acquisition or a business combination. For each transaction, the Group may elect to apply the concentration test to determine if the fair value of assets acquired is substantially concentrated in a single asset (or a group of similar assets). If this concentration test is met, the acquisition qualifies as an acquisition of a group of assets and liabilities, not of a business. Accounting for business combinations under IFRS 3 is applied once it is determined that a business has been acquired. Under IFRS 3, a business is defined as an integrated set of activities and assets conducted and managed for the purpose of providing a return to investors. A business generally consists of inputs, processes applied to those inputs, and resulting outputs that are, or will be, used to generate revenues. In a business combination, assets acquired and liabilities assumed are recorded at fair value and any excess in the consideration paid over the fair value of the net assets acquired is recorded as goodwill, while any excess fair value of the net assets acquired over the consideration fair value is recognized as a gain on bargain purchase. When less than the entire interest of an entity is acquired, the choice of measurement of the non-controlling interest, either at fair value or at the proportionate share of the acquiree’s identifiable net assets, is determined on a transaction by transaction basis. More information regarding the judgments and conclusions reached with respect to business combinations and asset acquisitions is included in Notes 4 and 5. Oaktree Capital Management, L.P. (“Oaktree”) Participation Agreement In October 2020, the Group entered into a three-year definitive participation agreement with funds managed by Oaktree to jointly identify and fund future proved developed producing acquisition opportunities (“PDP acquisitions”) that the Group identified. The Oaktree Funding Commitment provided for up to $1,000,000 in aggregate over three years for mutually agreed upon PDP acquisitions with transaction valuations typically greater than $250,000. The Group and Oaktree each funded 50% of the net purchase price in exchange for proportionate working interests of 51.25% and 48.75% during Tranche I deals, or joint acquisitions made during the first 18 months of the agreement, and 52.5% and 47.5% during Tranche II deals, or joint acquisitions made during the second 18 months of the agreement, respectively. The Group's greater share reflected the upfront promote it received from Oaktree which was intended to compensate the Group for the increase in general and administrative expenses needed to operate an entity that increases with acquired growth. Additionally, upon Oaktree achieving a 10% unlevered internal rate of return, Oaktree would convey a back-end promote to the Group which would increase the Group’s working interest to 59.625% for both Tranche I and Tranche II deals. The Group also maintained the right of first offer to acquire Oaktree’s interest if and when Oaktree decided to divest. The Group and Oaktree each had the right to participate in a sale by the other party with a third-party upon comparable terms. The Group accounted for the Oaktree Participation Agreement as a joint operation under IFRS 11, Joint Arrangements (“IFRS 11”). Accordingly, the Group included its proportionate share of assets, liabilities, revenues and expenses within the consolidated financial statements. The Oaktree Participation Agreement ended in October 2023. On June 6, 2024 the Group acquired Oaktree’s proportionate working interest in all Tranche I and Tranche II deals. Details of the acquisition are disclosed in Note 5. Inventory Natural gas inventory is stated at the lower of cost and net realizable value, cost being determined on a weighted average cost basis. Inventory also consists of material and supplies used in connection with the Group’s maintenance, storage and handling. Inventory is stated at the lower of cost or net realizable value. Cash and Cash Equivalents Cash on the balance sheet comprises cash at banks. Balances held at banks, at times, exceed U.S. federally insured amounts. The Group has not experienced any losses in such accounts and the Directors believe the Group is not exposed to any significant credit risk on its cash. Trade Receivables Trade receivables are recorded at their historical carrying amount, net of any required provisions. These receivables are due from customers across the natural gas and oil industry. While they are spread among several customers, their collectability depends on each customer’s financial health and the overall economic conditions of the industry. Management evaluates customers’ financial conditions before extending credit and typically do not require collateral to secure the recoverability of the Group’s trade receivables. Any adjustments to the Group’s allowance for expected credit losses during the year are recognized in the Consolidated Statement of Comprehensive Income. Trade receivables also include amounts due from third-party working interest owners and hedge settlement receivables. The Group consistently assesses the collectability of these receivables. As of December 31, 2024 and 2023, the Group considered a portion of these working interest receivables uncollectable and recorded an allowance for credit losses in the amount of $15,959 and $16,529 , respectively. Refer to Note 14 for additional information. Impairment of Financial Assets IFRS 9 requires the application of an expected credit loss model in considering the impairment of financial assets. The expected credit loss model requires the Group to account for expected credit losses and changes in those expected credit losses at each reporting date to reflect changes in credit risk since initial recognition of the financial assets. The credit event does not have to occur before credit losses are recognized. IFRS 9 allows for a simplified approach for measuring the allowance at an amount equal to lifetime expected credit losses for trade receivables. 98 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The Group applies the simplified approach to the expected credit loss model to trade receivables arising from: • Sales of natural gas, NGLs and oil; • Sales of gathering and transportation of third-party natural gas; and • The provision of other services. Borrowings Borrowings are initially recognized at fair value, net of any transaction costs incurred. They are then carried at amortized cost. The difference between the net proceeds and the redemption value is recognized in the Consolidated Statement of Comprehensive Income over the period of the borrowings using the effective interest method. Interest on borrowings is accrued according to each class of borrowing. Derivative Financial Instruments Derivatives are utilized as part of the Group’s strategy to mitigate risks associated with the cash flow unpredictability due to commodity price volatility. Additional details on the Group’s exposure to these risks can be found in Note 25. The Group has entered into financial instruments which are considered derivative contracts, such as swaps and collars, which result in net cash settlements each month without physical deliveries. The derivative contracts are initially recognized at fair value on the contract date and remeasured to fair value at each balance sheet date. The resulting gain or loss is recognized in the Consolidated Statement of Comprehensive Income under the gain (loss) on derivative financial instruments line item for the year incurred. Restricted Cash Cash held on deposit for bonding purposes is classified as restricted cash and recorded within current and non-current assets. This cash is either (1) restricted by state governmental agencies for use if the operator abandons any wells, or (2) held as collateral by the Group’s surety bond providers. Additionally, the Group is required to maintain certain cash reserves for interest payments related to its asset-backed securitizations, as detailed in Note 21 . These reserves typically cover one to six months of interest and any associated fees. The Group classifies restricted cash as either current or non- current, depending on the classification of the related asset or liability. This reserve cash is managed by an independent indenture trustee, who monitors the reserves monthly to ensure the correct amount is maintained. The deposit conditions restrict the Group from accessing the reserve cash on demand, meaning it no longer qualifies as cash and cash equivalents. December 31, 2024 December 31, 2023 Cash restricted by asset-backed securitizations $45,880 $35,870 Other restricted cash 389 382 Total restricted cash $46,269 $36,252 Classified as: Current asset $11,426 $11,195 Non-current asset 34,843 25,057 Total $46,269 $36,252 Natural Gas and Oil Properties Natural gas and oil activities are accounted for using the principles of the successful efforts method of accounting as described below. Development & Acquisition Costs Costs incurred to purchase, lease, or otherwise acquire a property are capitalized when incurred. Expenditures related to the construction, installation or completion of infrastructure facilities, such as platforms, and the drilling of development wells, including delineation wells, are capitalized within natural gas and oil properties. The initial cost of an asset comprises its purchase price or construction cost, any costs directly attributable to bringing the asset into operation, and the initial estimate of the asset retirement obligation. Depletion Proved natural gas, oil and NGL reserve volumes are used as the basis to calculate unit-of-production depletion rates. Leasehold costs are depleted on the unit-of-production basis over the total proved reserves of the relevant area while production and development wells are depleted over proved producing reserves. Intangible Assets Software Development Development costs that are directly attributable to the design and testing of identifiable and unique software products developed by third parties and controlled by the Group are recognized as intangible assets where the following criteria are met: • It is technically feasible to complete the software so that it will be available for use; • The Directors intend to complete the software and use it; • There is an ability to use the software; • It can be demonstrated how the software will generate probable future economic benefits; • Adequate technical, financial and other resources to complete the development and to use the software are available; and • The expenditure attributable to the software during its development can be reliably measured. Directly attributable costs that are capitalized as part of the software include cost incurred by third parties, employee costs and an appropriate portion of relevant overheads. Capitalized development costs are recorded as intangible assets and amortized from the point at which the asset is ready for use. Costs associated with maintaining software programs are recognized as an expense as incurred. 99 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Impairment of Intangible Assets Intangible assets are tested for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. An impairment loss is recognized when the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and its value in use. For impairment assessment purposes, assets are grouped at the lowest levels for which there are separately identifiable cash inflows that are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Intangible assets that have suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period. Amortization The Group amortizes intangible assets with a limited useful life, using the straight-line method over the following periods: Range in Years Software 3 Other acquired intangibles(a) 3 (a) Represents intangible assets acquired in business combinations and asset acquisitions. Property, Plant and Equipment Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. The initial recognized cost includes the purchase price and any costs directly attributable to bringing the asset to the location and condition necessary for it to operate as intended by the Directors. Property, plant and equipment are generally depreciated on a straight-line basis over their estimated useful lives: Range in Years Buildings and leasehold improvements 40 Equipment 5 - 10 Motor vehicles 5 Midstream assets 10 - 15 Other property and equipment 5 - 10 Property, plant and equipment held under leases are depreciated over the shorter of the lease term or estimated useful life. Impairment of Non-Financial Assets At each reporting date, the Group assesses whether there are indications that an asset may be impaired. If such indications exist, or if annual impairment testing is required, the Group estimates the asset’s recoverable amount. The recoverable amount is the higher of an asset’s or cash generating unit’s fair value less disposal costs and its value-in-use. This is determined for an individual asset unless the asset does not generate largely independent cash inflows from other assets or groups of assets. If the carrying amount of an asset or cash-generating unit exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value-in-use, the Group discounts the estimated future cash flows to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. When determining fair value less disposal costs, the Group considers recent market transactions, if available. If no such transactions are identified, an appropriate valuation model is used. Non-Controlling Interests Non-controlling interests represent the equity in subsidiaries that is not attributable to the Group’s shareholders. The acquisition of a non-controlling interest in a subsidiary and the sale of an interest while retaining control are accounted for as transactions within equity and are reported within non- controlling interests in the consolidated financial statements. During the years ended December 31, 2024, 2023 and 2022 , the Group recorded net income of $1,271 , $1,683 and $4,812, respectively, attributable to non-controlling interests. As of December 31, 2024 and 2023, the Group had a non-controlling interests balance of $11,879 and $12,604, respectively. During the years ended December 31, 2024, 2023 and 2022, the Group paid $1,996, $4,043 and $6,389, respectively, in distributions to non-controlling interest owners. Leases The Group recognizes a right-of-use asset and a lease liability at the commencement date of contracts (or separate components of a contract) that convey the right to control the use of an identified asset for a period of time in exchange for consideration, when such contracts meet the definition of a lease as determined by IFRS 16, Leases (“IFRS 16”). The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at inception date. The Group initially measures the lease liability at the present value of the future lease payments, discounted using the interest rate implicit in the lease. If this rate cannot be readily determined, the Group uses its incremental borrowing rate. After the commencement date, the lease liability is reduced by payments made and increased by interest on the lease liability. Right-of-use assets are initially measured at cost, which comprises: • The amount of the initial measurement of the lease liability; • Any lease payments made at or before the commencement date, less any lease incentives received; • Any initial direct costs incurred by the lessee; and • An estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located, or restoring the underlying asset to the condition required by the lease terms, unless those costs are incurred to produce inventories. 100 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Subsequent to the measurement date, the right-of-use asset is depreciated on a straight line basis over the period that reflects the life of the underlying asset and is also adjusted for the remeasurement of any lease liability. Asset Retirement Obligations When a liability exists for the retirement of a well, removal of production equipment, and site restoration at the end of a well’s productive life, the Group recognizes an asset retirement liability. The amount recognized is the present value of estimated future net expenditures, determined in accordance with our anticipated retirement plans and local conditions and requirements. The unwinding of the discount on the decommissioning liability is included as accretion of the decommissioning provision. The cost of the relevant property, plant and equipment asset is increased by an amount equivalent to the liability and depreciated on a unit of production basis. The Group recognizes changes in estimates prospectively, with corresponding adjustments to the liability and the associated non-current asset. Taxation Deferred Taxation Deferred tax assets and liabilities arise from temporary differences between the tax bases of assets and liabilities and their carrying amounts in the Group Financial Statements. Deferred tax is determined using tax rates (and laws) that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realized or the deferred liability is settled. Deferred tax assets are recognized to the extent that it is probable that the future taxable profit will be available against which the temporary differences can be utilized. The Group offsets deferred tax assets and liabilities when it has a legally enforceable right to set off current tax assets against current tax liabilities, provided that the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority. Current Taxation Current income tax assets and liabilities for the years ended December 31, 2024 and 2023 were measured at the amounts to be recovered from, or paid to, the taxation authorities. The tax rates (and laws) used to compute these amounts are those enacted or substantively enacted at the reporting date in the jurisdictions where the Group operates and generates taxable income. Uncertain Tax Positions Management periodically evaluates positions taken in tax returns where applicable tax regulation is subject to interpretation and considers whether it is probable that a taxation authority will accept an uncertain tax treatment. The Group measures its tax balances based on either the most likely amount or the expected value, depending on which method better predicts the resolution of the uncertainty. Revenue Recognition Natural Gas, NGLs & Oil Revenue (“Commodity Revenue”) Commodity revenue is derived from sales of natural gas, NGLs and oil products and is recognized when the customer obtains control of the commodity. This transfer generally occurs when the product is physically transferred into a vessel, pipe, sales meter, or other delivery mechanism. This also represents the point at which the Group fulfills its single performance obligation to its customer under contracts for the sale of natural gas, NGLs and oil as per IFRS 15, Revenue from Contracts with Customers (“IFRS 15”). Commodity revenue in which the Group has an interest with other producers is recognized proportionately based on the Group’s working interest and the terms of the relevant production sharing contracts. Royalty payments or counterparty distributions, representing the portion of revenue due to minority working interests, are recorded as a liability, described in Note 23. Commodity revenue is recorded based on the volumes accepted each day by customers at the delivery point and is measured using the respective market price index for the applicable commodity, adjusted by the applicable basis differential based on the quality of the product. Third-Party Gathering Revenue Revenue from gathering and transporting third-party natural gas is recognized when the customer transfers its natural gas to the entry point in the Group’s midstream network and becomes entitled to withdraw an equivalent volume of natural gas from the exit point in the Group’s midstream network. This transfer generally occurs when product is physically transferred into the Group’s vessel, pipe, or sales meter. The customer’s entitlement to withdraw an equivalent volume of natural gas is broadly coterminous with the transfer of natural gas into the Group’s midstream network. Customers are invoiced, and revenue is recognized each month based on the volume of natural gas transported at a contractually agreed-upon price per unit. Third-Party Plugging Revenue Revenue from third-party asset retirement services is recognized as earned in the month the work is performed, in accordance with the Group’s contractual obligations. These contractual obligations are considered the Group’s performance obligations for purposes of IFRS 15. Other Revenue Revenue from the operation of third-party wells is recognized as earned in the month the work is performed, in accordance with the Group’s contractual obligations. These contractual obligations are considered the Group’s performance obligations for purposes of IFRS 15. Revenue from the sale of water disposal services to third parties into the Group’s disposal wells is recognized as earned in the month the water is physically disposed of at a contractually agreed-upon price per unit. The disposal of the water is considered the Group’s performance obligation under these contracts. Revenue is stated after deducting sales taxes, excise duties, and similar levies. Share-Based Payments The Group accounts for share-based payments under IFRS 2, Share-Based Payment (“IFRS 2”). All of the Group’s share-based awards are equity settled, with their fair value determined at the grant date. As of December 31, 2024 , 2023 and 2022, the Group had three types of share-based payment awards: RSUs, PSUs and Options. The fair value of the Group’s RSUs is measured using the stock price at the grant date. The fair value of the Group’s PSUs is measured using a Monte Carlo simulation model. The inputs to the Monte Carlo simulation model included: • The share price at the date of grant; • Expected volatility; • Expected dividends; • Risk free rate of interest; and 101 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements • Patterns of exercise by the plan participants. The fair value of the Group’s Options was calculated using the Black-Scholes model as of the grant date. The inputs to the Black-Scholes model included: • The share price at the grant date; • Exercise price; • Expected volatility; and • Risk-free rate of interest. The grant date fair value of share-based awards, adjusted for market-based performance conditions, is expensed uniformly over the vesting period. New or Amended Accounting Standards - Adopted The following accounting standards, amendments and interpretations became effective in the current year: Standard Amendment Effective Date IAS 1 Classification of Liabilities as Current or Non-Current and Non-Current Liabilities with Covenants Annual periods beginning on or after January 1, 2024 The application of this standard and interpretations effective for the first time in the current year has had no significant impact on the amounts reported in the Group Financial Statements. New or Amended Accounting Standards - Not Yet Adopted At the date of authorization of the Group Financial Statements , the following standards and interpretations, which have not been applied in the Group Financial Statements , were in issue but not yet effective. It is expected that where applicable, these standards and amendments will be adopted on each respective effective date. The Group is still assessing the effect of these standards, though they are not expected to have a material impact. Standard Amendment Effective Date IAS 21 The Effects of Changes in Foreign Exchange Rates - Lack of Exchangeability Annual periods beginning on or after January 1, 2025 IFRS 9 Financial Instruments - Lessee Derecognition of Lease Liabilities Annual periods beginning on or after January 1, 2026 IFRS 7 & IFRS 9 Financial Instruments and Disclosures - Amendments to the Classification and Measurement of Financial Instruments Annual periods beginning on or after January 1, 2026 IAS 7 Statement of Cash Flows - Cost Method Annual periods beginning on or after January 1, 2026 IFRS 18 Presentation and Disclosures in Financial Statements - Primary Financial Statements Annual periods beginning on or after January 1, 2027 IFRS 19 Subsidiaries without Public Accountability: Disclosures - Disclosure Initiative - Subsidiaries without Public Accountability: Disclosures Annual periods beginning on or after January 1, 2027 Note 4 - Significant Accounting Judgments & Estimates (Amounts in thousands, except share, per share and per unit data) In applying the Group's accounting policies described in Note 3, the Directors made the following judgments and estimates, which may significantly affect the amounts recognized in the Group Financial Statements. Significant Judgments Business Combinations & Asset Acquisitions The Group follows the guidance in IFRS 3, Business Combinations (“IFRS 3”) for determining the appropriate accounting treatment for acquisitions. IFRS 3 permits an initial fair value assessment to determine if substantially all of the fair value of the assets acquired is concentrated in a single asset or group of similar assets, known as the “concentration test”. If the initial screening test is not met, the asset may be considered a business based on whether there are inputs and substantive processes in place. The accounting treatment is derived based on the results of this analysis and the conclusion on an acquisition’s classification as a business combination or an asset acquisition. If the acquisition is deemed to be a business, the acquisition method of accounting is applied. Identifiable assets acquired and liabilities assumed at the acquisition date are recorded at fair value. When the fair value exceeds the consideration transferred, a bargain purchase gain is recognized. Conversely, when the consideration transferred exceeds the fair value, goodwill is recorded. If the transaction is deemed to be an asset purchase, the cost accumulation and allocation model is used whereby the assets and liabilities are recorded based on the purchase price and allocated to the individual assets and liabilities based on relative fair values. As a result, gains on bargain purchases are not recognized on asset acquisitions. Additionally, in instances when the acquisition of a group of assets contains contingent consideration, the Group records changes in the fair value of the contingent consideration through the basis of the asset acquired rather than through the Consolidated Statement of Comprehensive Income. More information regarding conclusions reached with respect to this judgment is included in Note 5. The determination and allocation of fair values to the identifiable assets acquired and liabilities assumed in a business combination are based on various market participant assumptions and valuation methodologies, requiring considerable judgment by management. The most significant variables in these valuations are discount rates and other assumptions and estimates used to determine the cash inflows and outflows. Management determines discount rates based on the risk inherent in the acquired assets, specific risks, industry beta, and the capital structure of guideline companies. The valuation of an acquired business is based on available information at the acquisition date and assumptions that are believed to be reasonable. However, a change in facts and circumstances as of the acquisition date can result in subsequent adjustments during the measurement period, but no later than one year from the acquisition date. 102 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Significant Estimates Estimating the Fair Value of Acquired Natural Gas & Oil Properties The Group determines the fair value of its natural gas and oil properties acquired through business combinations using the income approach. This approach is based on expected discounted future cash flows, which are derived from estimated reserve quantities, production and development costs, and forward prices for natural gas and oil. Future net cash flows are discounted using a weighted average cost of capital and additional risk factors. Proved reserves are estimated using available geological and engineering data and include only those volumes for which market access is reasonably certain. These estimates are inherently imprecise, requiring judgment and regular revisions. Revisions may be based on new information from additional drilling, long-term reservoir performance observations, and changes in economic factors such as product prices, contract terms, or operating expenses. Impairment of Natural Gas & Oil Properties When preparing the Group Financial Statements , the Group considers whether there is any evidence of impairment in the natural gas and oil properties. This assessment involves reviewing producing assets for impairment indicators at the balance sheet date. Indicators can include significant or prolonged decreases in commodity pricing, negative market changes, downward revisions of reserve estimates, or increases in operating costs. The Group reviews the carrying value of its natural gas and oil properties on a field basis annually or when an indicator of impairment is identified. The impairment test compares the carrying value of these properties to their recoverable amount, which is based on the present value of estimated future net cash flows from proved reserves. These future cash flows are calculated using estimated reserve quantities, production and development costs, and forward prices for natural gas and oil. If the carrying value exceeds fair value, the Group recognizes an impairment by writing down the value of the properties to their fair value. For the year ended December 31, 2024, no such impairments were recorded. For the year ended December 31, 2023, the Group determined that the carrying amounts of certain proved properties for two fields were not recoverable from future cash flows and recognized an impairment charge of $41,616. No such impairment was recorded during the year ended December 31, 2022. Refer to Note 10 for additional information regarding the Group’s impairment assessment. If there has been an impairment charge in a previous period, it will be reversed in a later period if circumstances change and the recoverable amount exceeds the net book value at the time. When reversing impairment losses, the asset’s carrying amount will be increased to the lower of its original carrying value or the carrying value that would have been determined (net of depletion) if no impairment loss had been recognized in prior years. No such recoveries were recorded during the years ended December 31, 2024 , 2023, and 2022. For more details, refer to Note 10. When applicable, the Group recognizes impairment losses in the Consolidated Statement of Comprehensive Income, categorizing them according to the function of the impaired asset. Reserve Volume Estimates Proved reserves are the estimated volumes of natural gas, oil and NGLs that can be economically produced with reasonable certainty from known reservoirs, given current economic conditions and operating methods. To estimate these reserves, we depend on the interpretation and judgment of engineering and production data, along with certain economic data such as commodity prices, operating expenses, capital expenditures, and taxes. Since many factors, assumptions, and variables involved in estimating proved reserves can change over time, the estimates of natural gas, oil and NGL reserve volumes are subject to revision. Taxation The Group makes certain estimates when calculating deferred tax assets and liabilities, as well as income tax expense. These estimates often require judgment regarding the timing and recognition of differences of revenue and expenses for tax and financial reporting purposes, as well as the tax basis of our assets and liabilities at the balance sheet date before tax returns are completed. Additionally, the Group must evaluate the likelihood of recovering or utilizing its deferred tax assets and may record a valuation allowance against these assets when it is not expected that they will be realized. In determining whether to apply a valuation allowance, the Group considers evidence such as future taxable income, among other factors. This process involves numerous judgments and assumptions, including estimates of commodity prices, production, and other operating conditions. If any of these factors, assumptions, or judgments change, the deferred tax asset could be adjusted, particularly decreasing if it is determined that the asset is unlikely to be realized. Conversely, a valuation allowance may be reversed if it is determined that the asset is likely to be realized. Asset Retirement Obligations The costs associated with asset retirement obligations are inherently uncertain and can fluctuate due to various factors, such as changes in legal requirements, the development of new restoration techniques, or experiences at other production sites. The expected timing and amount of these expenditures can also vary, for instance, due to changes in reserves or modifications in laws and regulations or their interpretation. Consequently, significant estimates and assumptions are necessary to determine the provision for asset retirement. These assumptions include the costs to retire the wells, the Group’s retirement plan, an assumed inflation rate, and the discount rate. Changes in these assumptions could lead to a substantial change in the carrying value of the asset retirement obligations within the next financial year. For more details and sensitivity analysis, refer to Note 19. Note 5 - Acquisitions & Divestitures (Amounts in thousands, except share, per share and per unit data) The assets acquired in all acquisitions include the necessary permits, rights to production, royalties, assignments, contracts and agreements that support the production from wells and operation of pipelines. The Group determines the accounting treatment of acquisitions using IFRS 3. 2024 Acquisitions East Texas II Asset Acquisition On October 29, 2024, the Group acquired certain developed producing assets in the East Texas area of the Central Region from a regional operator (the “Seller”) (altogether, the “East Texas II transaction”). The Group assessed the acquired assets and determined that this transaction was considered an asset acquisition rather than a business combination. When making this determination, management evaluated IFRS 3 and concluded that the acquired assets did not meet the definition of a business. The Group paid purchase consideration of $67,782 , inclusive of transaction costs of $744 and customary purchase price adjustments. The transaction was funded through a combination of cash consideration of $40,329, drawing from a senior secured bank facility supported by the acquired assets and existing liquidity, and the issuance of 2,342,445 new ordinary shares direct to the Seller. Refer to Notes 16 and 21 for additional information regarding share capital and debt, respectively. In the period from its acquisition to December 31, 2024 the East Texas II assets increased the Group’s revenue and operating expense by $4,889 and $1,598, respectively. 103 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The assets acquired and liabilities assumed were as follows: Consideration paid Cash consideration $40,329 Value of shares issued as consideration 27,453 Total consideration $67,782 Net assets acquired Natural gas and oil properties $78,087 Asset retirement obligations, asset portion 11,902 Property, plant and equipment 1,045 Asset retirement obligations, liability portion (11,902) Other current liabilities (11,350) Net assets acquired $67,782 Crescent Pass Energy (“Crescent Pass”) Asset Acquisition On August 15, 2024 , the Group acquired certain upstream assets and related infrastructure in the East Texas area of the Central Region from Crescent Pass. The Group assessed the acquired assets and determined that this transaction was considered an asset acquisition rather than a business combination. When making this determination, management evaluated IFRS 3 and concluded that the acquired assets did not meet the definition of a business. The Group paid purchase consideration of $97,678, inclusive of transaction costs of $846 and customary purchase price adjustments. The transaction was funded through a combination of the issuance of 2,249,650 new ordinary shares direct to Crescent Pass and cash consideration of $69,265 from the new Term Loan II supported by the acquired assets. Refer to Notes 16 and 21 for additional information regarding share capital and debt, respectively. In the period from its acquisition to December 31, 2024 the Crescent Pass assets increased the Group’s revenue and operating expense by $10,283 and $6,101, respectively. The assets acquired and liabilities assumed were as follows: Consideration paid Cash consideration $69,265 Value of shares issued as consideration 28,413 Total consideration $97,678 Net assets acquired Natural gas and oil properties $105,737 Asset retirement obligations, asset portion 34,247 Property, plant and equipment 534 Trade receivables, net 1,926 Asset retirement obligations, liability portion (34,247) Other current liabilities (10,519) Net assets acquired $97,678 Oaktree Capital Management, L.P. (“Oaktree”) Working Interest Asset Acquisition On June 6, 2024 the Group acquired Oaktree’s proportionate working interest in the East Texas, Tapstone, Tanos and Indigo acquisitions. The Group assessed the acquired assets and determined that this transaction was considered an asset acquisition rather than a business combination. When making this determination, management evaluated IFRS 3 and concluded that the acquired assets did not meet the definition of a business. The Group paid purchase consideration of $221,660, inclusive of transaction costs of $2,064 and customary purchase price adjustments. As part of this transaction, the Group assumed Oaktree’s proportionate debt of $132,576 associated with the ABS VI Notes. The Group funded the purchase through a combination of existing and expanded liquidity and issued approximately $83,348 in notes payable to Oaktree. Refer to Note 21 for additional information regarding debt. In the period from its acquisition to December 31, 2024 the Oaktree assets increased the Group’s revenue and operating expense by $65,708 and $31,626, respectively. 104 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The assets acquired and liabilities assumed were as follows: Consideration paid Cash consideration $177,550 Oaktree Seller's Note 83,348 Elimination of Oaktree liability (39,238) Total consideration $221,660 Net assets acquired Natural gas and oil properties $315,611 Asset retirement obligations, asset portion 63,770 Property, plant and equipment 457 Restricted cash 6,153 Derivative financial instruments, net 39,841 Asset retirement obligations, liability portion (63,770) Borrowings (132,576) Other current liabilities (7,826) Net assets acquired $221,660 Other Acquisitions On December 30, 2024 the Group acquired certain upstream assets in the Central Region that are contiguous to its existing East Texas assets. The Group paid purchase consideration of $1,181, inclusive of customary purchase price adjustments and transaction costs. Given the concentration of assets, this transaction was considered an asset acquisition rather than a business combination. 2024 Divestitures During the year ended December 31, 2024 , the Group divested certain other non-core undeveloped acreage across its operating footprint for consideration of approximately $59,048 . Th e consideration received exceeded the carrying value of the net assets divested resulting in a gain on natural gas and oil properties and equipment of $26,312 . 2023 Acquisitions Tanos Energy Holdings II LLC (“Tanos II”) Asset Acquisition On March 1, 2023 the Group acquired certain upstream assets and related infrastructure in the Central Region from Tanos II. Given the concentration of assets, this transaction was considered an asset acquisition rather than a business combination. When making this determination management performed an asset concentration test considering the fair value of the acquired assets. The Group paid purchase consideration of $262,329, inclusive of transaction costs of $936 and customary purchase price adjustments. The Group funded the purchase with proceeds from the February 2023 equity raise, cash on hand and existing availability on the Credit Facility for which the borrowing base was upsized concurrent to the closing of the Tanos II transaction. Refer to Notes 16 and 21 for additional information regarding the Group’s share capital and borrowings. In the period from its acquisition to December 31, 2023 the Tanos II assets increased the Group’s revenue by $45,589. 2023 Divestitures Sale of Equity Interest in DP Lion Equity HoldCo LLC In November 2023, the Group formed DP Lion Equity Holdco LLC, a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue Class A and Class B asset-backed securities (collectively “ABS VII”) which are secured by certain upstream producing assets in Appalachia. The Class A and B asset backed securities were issued in aggregate principal amounts of $142,000 and $20,000, respectively. In December 2023 , the Group divested 80% of the equity ownership in DP Lion Equity Holdco LLC to outside investors, generating cash proceeds of $30,000. The Group evaluated the remaining 20% interest in DP Lion Equity Holdco LLC and determined that the governance structure is such that th e Group does not have the ability to exercise control, joint control, or significant influence over the DP Lion Equity Holdco LLC entity. Accordingly, this entity is not consolidated within the Group’s financial statements as of December 31, 2023. The consideration exceeded the fair value of the Group’s portion of the assets and liabilities divested resulting in a gain on sale of the equity interest of $18,440. The Group’s remaining investment in the LLC is accounted for as an equity instrument at fair value in accordance with IFRS 9, Financial Instruments (“IFRS 9”) and was $7,500 at December 31, 2023, which generated an unrealized gain of $4,610. During 2024, the Group identified that the l iability for revenues to be distributed of $7,375 associated with the divested wells in the DP Lion Holdco LLC transaction was inappropriately relieved and should have remained consolidated within the Group Financial Statements. The Group assessed the error and determined that it is immaterial, quantitatively and qualitatively, to the 2023 and 2024 Group Financial Statements. Accordingly, the error has been corrected as an out of period adjustment in the current year within the “Gain (loss) on sale of equity interest” line item in the Group’s Statement of Comprehensive Income. Other 2023 Divestitures On July 17, 2023, the Group sold undeveloped acreage in Oklahoma, within the Group’s Central Region, for net consideration of approximately $16,060. The consideration received exceeded the fair value of the net assets divested resulting in a gain on natural gas and oil properties and equipment of $13,619. On June 27, 2023, the Group sold certain non-core, non-operated assets within its Central Region for gross consideration of approximately $37,589. The divested assets were located in Texas and Oklahoma and consisted of non-operated wells and the associated leasehold acreage that was acquired as 105 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements part of the ConocoPhillips Asset Acquisition in September 2022. This sale of non-operated and non-core assets aligns with the Group’s application of the Smarter Asset Management strategy and its strategic focus on operated proved developed producing assets. Additionally, during the year ended December 31, 2023, the Group divested certain other non-core undeveloped acreage across its operating footprint for consideration of approximately $12,100. The consideration received exceeded the fair value of the net assets divested resulting in a gain on natural gas and oil properties and equipment of $10,547. 2022 Acquisitions ConocoPhillips Asset Acquisition On September 27, 2022 the Group acquired certain upstream assets and related facilities within the Central Region from ConocoPhillips. Given the concentration of assets, this transaction was considered an asset acquisition rather than a business combination. When making this determination management performed an asset concentration test considering the fair value of the acquired assets. The Group paid purchase consideration of $209,766, including customary purchase price adjustments. Transaction costs associated with the acquisition were negligible. The Group funded the purchase with available cash on hand and a draw on the Credit Facility. In the period from its acquisition to December 31, 2022 the ConocoPhillips assets increased the Group’s revenue by $25,217. East Texas Asset Acquisition (“East Texas I”) On April 25, 2022 , the Group acquired a proportionate 52.5% working interest in certain upstream assets and related facilities within the Central Region from a private seller in conjunction with Oaktree, via the previously disclosed participation agreement between the two parties. Given the concentration of assets, this transaction was considered an asset acquisition rather than a business combination. When making this determination, the Group performed an asset concentration test considering the fair value of the acquired assets. The Group paid purchase consideration of $47,468, including customary purchase price adjustments. Transaction costs associated with the acquisition were $1,550. The Group funded the purchase with available cash on hand and a draw on the Credit Facility. Other 2022 Acquisitions During the period ended December 31, 2022 the Group acquired three asset retirement companies for an aggregate consideration of $13,949 , inclusive of customary purchase price adjustments. The Group also paid an additional $3,150 in deferred consideration through November 2024. During the year ended December 31, 2024 and 2023, the Group paid $1,050 and $2,100 , respectively, of the deferred consideration. When evaluating these transactions, the Group determined they did not have significant asset concentrations and as a result it had acquired identifiable sets of inputs, processes and outputs and concluded the transactions were business combinations. On April 1, 2022 the Group acquired certain midstream assets, inclusive of a processing facility, in the Central Region that are contiguous to its existing East Texas assets. The Group paid purchase consideration of $10,139, inclusive of customary purchase price adjustments and transaction costs. When evaluating the transaction, the Group determined it did not have significant asset concentration and as a result it had acquired an identifiable set of inputs, processes and outputs and accordingly concluded the transaction was a business combination. The fair value of the net assets acquired was $10,742 generating a bargain purchase gain of $603. On November 21, 2022 the Group acquired certain midstream assets in the Central Region that are contiguous to its existing East Texas assets. The Group paid purchase consideration of $7,438 , inclusive of customary purchase price adjustments and transaction costs. Given the concentration of assets, this transaction was considered an asset acquisition rather than a business combination. Transaction costs associated with the other acquisitions noted above were insignificant and the Group funded the aggregate cash consideration with existing cash on hand. Subsequent Events On February 27, 2025 , the Group announced the completion of its previously announced acquisition of certain upstream assets and related infrastructure within Virginia, West Virginia, and Alabama of the Appalachian Region from Summit for a gross purchase price of approximately $45,000 before customary purchase price adjustments. The transaction was funded through the new ABS X Notes collateralized, in part, by the acquired assets. Refer to Note 21 for additional information regarding debt. On March 14, 2025, the Group announced the completion of its previously announced Maverick acquisition for a gross purchase price of approximately $1,275,000 . The transaction was funded through the assumption of approximately $700,000 of Maverick debt outstanding, the issuance of 21,194,213 new ordinary shares direct to the unitholders of Maverick, and approximately $207,000 in cash on hand. Refer to Notes 16 and 21 for additional information regarding share capital and debt. Note 6 - Revenue (Amounts in thousands, except share, per share and per unit data) The Group extracts and sells natural gas, NGLs and oil to a variety of customers and operates most of the wells on behalf of customers and other working interest owners. Additionally, the Group offers gathering and transportation services, as well as asset retirement and other services to third parties. All revenue is generated within the U.S. 106 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The following table reconciles the Group's revenue for the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Natural gas $464,600 $557,167 $1,544,658 NGLs 150,513 141,321 188,733 Oil 117,146 103,911 139,620 Total commodity revenue $732,259 $802,399 $1,873,011 Midstream 32,535 30,565 32,798 Other(a) 30,047 35,299 13,540 Total revenue $794,841 $868,263 $1,919,349 (a) Includes $16,305, $28,360, and $9,246 in third party plugging revenue and $13,742 , $6,939, and $4,294 in other revenue for the years ended December 31, 2024, 2023 , and 2022, respectively. Refer to Note 3 for additional information. A significant portion of the Group’s trade receivables stem from sales of natural gas, NGLs and oil, as well as operational services. These receivables are uncollateralized and typically collected within 30 to 60 days. For the years ended December 31, 2024, 2023 and 2022, no single customer accounted for more than 10% of total revenues. Note 7 - Expenses by Nature (Amounts in thousands, except share, per share and per unit data) The table below details the Group's expenses for the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 LOE(a) $231,651 $213,078 $182,817 Production taxes(b) 36,043 61,474 73,849 Midstream operating expenses(c) 70,747 69,792 71,154 Transportation expenses(d) 90,461 96,218 118,073 Total operating expenses $428,902 $440,562 $445,893 Depreciation and amortization 59,358 56,453 51,877 Depletion 197,126 168,093 170,380 Total depreciation, depletion and amortization $256,484 $224,546 $222,257 Employees, administrative costs and professional services(e) 86,885 78,659 77,172 Costs associated with acquisitions(f) 11,573 16,775 15,545 Other adjusting costs(g) 22,375 17,794 69,967 Non-cash equity compensation(h) 8,286 6,494 8,051 Total G&A $129,119 $119,722 $170,735 Recurring allowance for credit losses(i) 101 8,478 — Total expenses $814,606 $793,308 $838,885 Aggregate remuneration (including Directors): Wages and salaries $133,024 $124,834 $113,267 Payroll taxes 10,380 10,163 9,516 Benefits 29,252 31,912 23,828 Total employees and benefits expense $172,656 $166,909 $146,611 (a) LOE encompasses costs incurred to maintain producing properties. These costs include direct and contract labor, repairs and maintenance, emissions reduction initiatives, water hauling, compression, automobile, insurance, and materials and supplies expenses. (b) Production taxes consist of severance and property taxes. Severance taxes are typically paid on produced natural gas, NGLs and oil at fixed rates set by federal, state or local taxing authorities. Property taxes are generally based on the valuation of the Group’s natural gas and oil properties and midstream assets by the taxing jurisdictions. (c) Midstream operating expenses are the daily costs of operating the Group’s owned midstream assets, including employee and benefit expenses. (d) Transportation expenses are the daily costs incurred from third-party systems to gather, process, and transport the Group’s natural gas, NGLs and oil. (e) Employees, administrative costs and professional services include payroll and benefits for our administrative and corporate staff, costs of maintaining administrative and corporate offices, managing our production operations, franchise taxes, public company costs, fees for audit and other professional services, and legal compliance. (f) Costs associated with acquisitions are related to the integration of acquisitions, which vary for each acquisition. For acquisitions classified as business combinations, 107 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements these costs include transaction costs directly associated with a successful acquisition. They also encompass costs related to transition service arrangements, where the Group pays the seller of the acquired entity a fee to manage G&A functions until full integration of the assets. Additionally, these costs include costs to cover expenses for integrating IT systems, consulting, and internal workforce efforts directly related to incorporating acquisitions into the Group’s systems. (g) Other adjusting costs for the year ended December 31, 2024, were primarily associated with legal and professional fees related to the U.S. listing, legal fees for certain litigation, and expenses associated with unused firm transportation agreements. For the year ended December 31, 2023, these costs were primarily related to legal and professional fees for the U.S. listing, legal fees for certain litigation, and expenses for unused firm transportation agreements. For the year ended December 31, 2022, these costs mainly included $28,345 in contract terminations, which enabled the Group to secure more favorable future pricing, and $31,099 in deal breakage and/or sourcing costs for acquisitions. (h) Non-cash equity compensation represents the expense recognition for share-based compensation provided to key members of the management team. Refer to Note 17 for additional details on non-cash share-based compensation. (i) Allowance for credit losses consists of the recognition and reversal of credit losses. Refer to Note 14 for additional information regarding credit losses. The following table presents the number of employees as of the dates presented (employee count not shown in thousands): As of December 31, 2024 December 31, 2023 December 31, 2022 Number of production support employees, including Executive Directors 402 389 362 Number of production employees 1,187 1,214 1,220 Workforce 1,589 1,603 1,582 The following table presents the average number of employees for the periods presented (employee count not shown in thousands): Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Average workforce, including Executive Directors 1,571 1,593 1,512 The Group defines key management personnel as the executive and non-executive Directors. Bradley G. Gray is excluded from the executive Director remuneration below for the year ended December 31, 2024 and is included for the years ended December 31, 2023 and 2022. Mr. Gray was a Director through September 15, 2023. The fixed pay figures included in the table represent Mr. Gray’s prorated compensation for the year ended December 31, 2023. The Directors’ remuneration was as follows for the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Executive Directors Salary $780 $1,073 $1,157 Taxable benefits(a) 17 20 24 Benefit plan(b) 42 46 73 Bonus(c) 1,160 1,130 1,631 Long-term incentives(c) 1,541 2,322 3,193 Total Executive Directors' remuneration 3,540 4,591 6,078 Non-Executive Directors Fees 1,050 994 911 Total Non-Executive Directors' remuneration 1,050 994 911 Total remuneration $4,590 $5,585 $6,989 (a) Taxable benefits were comprised of Group paid life insurance premiums and automobile reimbursements. (b) Reflects matching contributions under the Group’s 401(k) plan and health insurance benefits. (c) Further details of the bonus outcome for 2024 and long-term incentives can be found in the Remuneration Committee’s Report within this Annual Report . Details of the highest paid Director’s aggregate emoluments and amounts receivable under long-term incentive schemes are disclosed in the Remuneration Committee’s Report within this Annual Report. 108 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Auditors’ remuneration for the periods presented was as follows: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Auditors' remuneration Fees payable to the Group’s external auditors and their associates for the audit of the consolidated financial statements (a) $3,198 $2,140 $1,790 Fees payable for the audit of the financial statements of the Company's subsidiaries (b) 100 150 160 Audit-related assurance services(c) 756 1,078 874 Other assurance services 9 13 — Total auditors' remuneration $4,063 $3,381 $2,824 (a) The 2024 and 2023 fees include $348 and $249, respectively, for additional fees agreed upon and billed after signing the 2023 and 2022 consolidated accounts, respectively. (b) The 2022 fees were revised to reflect additional scope change for the audit of the subsidiary accounts. (c) Fees related to the Group’s interim review and capital market activities, which are outside the scope of the audit of the consolidated financial statements. The 2022 fees were revised to reflect additional work performed for the interim review. Note 8 - Taxation (Amounts in thousands, except share, per share and per unit data) The Group files a consolidated U.S. federal tax return, multiple state tax returns, and a separate UK tax return for the Parent entity. The consolidated taxable income includes an allocable portion of income from the Group’s previous co-investment with Oaktree and its investment in the Chesapeake Granite Wash Trust. Income taxes are provided for the tax effects of transactions reported in the Group Financial Statements and consist of taxes currently due, plus deferred taxes related to differences between the basis of assets and liabilities for financial and income tax reporting. For the taxable years ended December 31, 2024 , 2023 , and 2022, the Group had a tax benefit of $136,951, an expense of $240,643, and a benefit of $178,904, respectively. The effective tax rate used for the year ended December 31, 2024 was 61.2%, compared to 24.1% for the year ended December 31, 2023, and 22.4% for the year ended December 31, 2022. The effective tax rate for December 31, 2024 was primarily influenced by the recognition of the federal marginal well tax credit available to qualified producers. The effective tax rate for December 31, 2023 was mainly affected by changes in state taxes due to acquisitions and recurring permanent differences. The effective tax rate for December 31, 2022 was primarily impacted by changes in state taxes resulting from acquisitions. The federal government provides marginal well tax credits to encourage companies to continue operating lower-volume wells during periods of low prices, thereby maintaining the jobs they create and the state and local tax revenues they generate for communities to support schools, social programs, law enforcement, and other public services. These credits, prescribed by Internal Revenue Code Section 45I, are available for certain natural gas production from qualifying wells. These credits benefit wells producing less than 90 Mcfe per day when market prices for natural gas in the previous tax year are relatively low. The Group benefited from these credits due to its portfolio of long-life, low-decline conventional wells. These credits were not available for the tax years 2023 and 2022 due to improved commodity prices during 2022 and 2021. The provision for income taxes in the Consolidated Statement of Comprehensive Income is summarized below: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Current income tax (benefit) expense Federal (benefit) expense $(18,238) $7,289 $(513) State (benefit) expense 1,122 5,902 2,841 Foreign - UK (benefit) expense 234 — 107 Total current income tax (benefit) expense $(16,882) $13,191 $2,435 Deferred income tax (benefit) expense Federal (benefit) expense $(111,003) $202,133 $(169,531) State (benefit) expense (9,016) 25,460 (11,863) Foreign - UK (benefit) expense (50) (141) 55 Total deferred income tax (benefit) expense $(120,069) $227,452 $(181,339) Total income tax (benefit) expense $(136,951) $240,643 $(178,904) 109 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The effective tax rates and differences between the statutory U.S. federal income tax rate and the effective tax rates are summarized as follows: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Income (loss) before taxation $(223,952) $1,000,344 $(799,502) Income tax benefit (expenses) 136,951 (240,643) 178,904 Effective tax rate 61.2% 24.1% 22.4% Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Expected tax at statutory U.S. federal income tax rate 21.0% 21.0% 21.0% State income taxes, net of federal tax benefit 3.7% 3.1% 1.2% Federal credits 41.3% 0.0% 0.0% Other, net (4.8%) 0.0% 0.2% Effective tax rate 61.2% 24.1% 22.4% The Group had a net deferred tax asset of $251,276 at December 31, 2024, compared to a net deferred tax asset of $131,206 at December 31, 2023 . This change was primarily due to a poor commodity price environment generating unrealized gains for unsettled derivatives not recognized for tax purposes as well as the recognition on marginal well credits. The Group had a net deferred tax asset of $131,206 at December 31, 2023, compared to a net deferred tax asset of $358,666 at December 31, 2022. This change was primarily due to a poor commodity price environment generating unrealized gains for unsettled derivatives not recognized for tax purposes. The balance sheet presentation considers the offsetting of deferred tax assets and liabilities within the same tax jurisdiction, where permitted. The overall deferred tax position in a particular tax jurisdiction determines if a deferred tax balance related to that jurisdiction is presented within deferred tax assets or liabilities. The table below presents the components of the net deferred tax asset (liability) included in non-current assets (liabilities) as of the periods presented: December 31, 2024 December 31, 2023 Deferred tax asset Asset retirement obligations $157,035 $103,998 Derivative financial instruments 191,512 153,057 Allowance for doubtful accounts 4,099 4,235 Net operating loss carryover 4,425 686 Federal tax credits carryover 233,969 163,158 163(j) interest expense limitation 41,031 24,324 Total deferred tax asset $632,071 $449,458 Deferred tax liability Amortization and depreciation $(352,059) $(252,587) Investment in partnerships (5,233) (60,067) Other (23,503) (5,598) Total deferred tax liability $(380,795) $(318,252) Net deferred tax asset (liability) $251,276 $131,206 Balance sheet presentation Deferred tax asset $259,287 $144,860 Deferred tax liability (8,011) (13,654) Net deferred tax asset (liability) $251,276 $131,206 In assessing the realizability of deferred tax assets, the Group considers whether it is probable that some or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets depends on generating future taxable income during the periods in which those temporary differences become deductible or before credits expire. The Group evaluates the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. At this time, the Group has determined it will have sufficient future taxable income to recognize its deferred tax assets. 110 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The Group reported the effects of deferred tax expense as of and for the year ended December 31, 2024: Opening Balance Consolidated Statement of Comprehensive Income Other(a) Closing Balance Asset retirement obligations $103,998 $53,037 $— $157,035 Allowance for doubtful accounts 4,235 (136) — 4,099 Net operating loss carryover 686 3,739 — 4,425 Federal tax credits carryover 163,158 70,811 — 233,969 Property, plant, and equipment and natural gas and oil properties (252,587) (99,472) — (352,059) Derivative financial instruments 153,057 38,455 — 191,512 Investment in partnerships (60,067) 54,834 — (5,233) 163(j) interest expense limitation 24,324 16,707 41,031 Other (5,598) (17,906) 1 (23,503) Total deferred tax asset (liability) $131,206 $120,069 $1 $251,276 (a) Amounts primarily relate to deferred taxes acquired as part of acquisition purchase accounting. The Group reported the effects of deferred tax expense as of and for the year ended December 31, 2023: Opening Balance Consolidated Statement of Comprehensive Income Other(a) Closing Balance Asset retirement obligations $92,393 $11,605 $— $103,998 Allowance for doubtful accounts 2,378 1,857 — 4,235 Net operating loss carryover 3,865 (3,179) — 686 Federal tax credits carryover 184,975 (21,817) — 163,158 Property, plant, and equipment and natural gas and oil properties (255,440) 2,853 — (252,587) Derivative financial instruments 378,918 (225,861) — 153,057 Investment in partnerships (82,930) 8,570 14,293 (60,067) 163(j) interest expense limitation 15,573 8,751 24,324 Other 18,934 (10,231) (14,301) (5,598) Total deferred tax asset (liability) $358,666 $(227,452) $(8) $131,206 (a) Amounts primarily relate to a deferred taxes reclass for comparative purposes. The Group reported the effects of deferred tax expense as of and for the year ended December 31, 2022: Opening Balance Consolidated Statement of Comprehensive Income Other(a) Closing Balance Asset retirement obligations $114,182 $(21,789) $— $92,393 Allowance for doubtful accounts 1,734 644 — 2,378 Net operating loss carryover 562 3,360 (57) 3,865 Federal tax credits carryover 183,460 1,515 — 184,975 Property, plant, and equipment and natural gas and oil properties (266,987) 11,360 187 (255,440) Derivative financial instruments 202,802 176,116 — 378,918 Investment in partnerships (72,105) (11,068) 243 (82,930) 163(j) interest expense limitation — 15,573 — 15,573 Other 13,306 5,628 — 18,934 Total deferred tax asset (liability) $176,954 $181,339 $373 $358,666 (a) Amounts primarily relate to deferred taxes acquired as part of acquisition purchase accounting. The Group’s material deferred tax assets and liabilities all originate in the U.S. 111 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements For U.S. federal tax purposes, the Group is taxed as a single consolidated entity. The Group’s co-investments with Oaktree and its investment in the Chesapeake Granite Wash Trust are taxed as partnerships that pass through to the Group’s consolidated return. The Group is also subject to additional taxes in its domiciled jurisdiction of the UK. For the years ended December 31, 2024, 2023, and 2022, the Group incurred a expense of $234, no tax impact, and an expense of $107 in the UK, respectively. The Organization for Economic Cooperation and Development (“OECD”) has proposed model rules for a global minimum tax of 15% of reported profits (“Pillar Two”) that has been agreed upon in principle by over 140 countries. While the U.S. has not yet enacted rules implementing Pillar Two, the U.K. has. This is relevant to the Company as it is resident in the U.K. for corporation tax purposes. The Finance (No. 2) Act 2023 (the “UK Act”) was enacted on July 11, 2023, and implements the OECD’s Base Erosion & Profit Shifting (“BEPS”) Pillar Two Income Inclusion Rule and a ‘Qualifying Domestic Minimum Top-up Tax’ for accounting periods beginning on or after December 31, 2023. The UK Act also includes a transitional safe harbor election for accounting periods beginning on or before December 31, 2026. Although the Pillar Two rules can lead to additional taxes, including taxes on our profits in the U.S., the Group anticipates qualifying for a transitional safe harbor under the Pillar Two rules. We have undertaken an assessment and evaluated the impact of these rules based on the Group’s results for the year ended December 31, 2024 and the Group believes it will not have a material impact on its financial position, results of operations, or cash flows due to the availability of a transitional safe harbor for the year ended December 31, 2024. The Group will continue to evaluate the potential consequences of Pillar Two on its longer-term financial position. The Group has applied the exception to recognizing and disclosing information about deferred tax assets and liabilities related to Pillar Two income taxes. The Group had no uncertain tax position liabilities as of December 31, 2024 , 2023 or 2022. As of December 31, 2024, the Group had U.S. federal net operating loss carryforwards (“NOLs”) of approximately $1,570, of which $1,474 are subject to limitation. Additionally, the Group had $6,494 U.S. state NOLs. The Group had U.S. marginal well tax credit carryforwards of approximately $233,969 as of December 31, 2024, compared to $163,158 as of December 31, 2023, and $184,975 as of December 31, 2022. As discussed earlier, the federal tax credit is intended to benefit wells producing less than 90 Mcfe per day when market prices for natural gas are relatively low. Due to the low commodity price environment in 2023, the Group generated federal tax credits of $91,831 for the year ended December 31, 2024. These tax credits expire between 2040 and 2044. The Group had $14,203 U.S. federal capital loss carryforwards as of December 31, 2024, compared to none as of December 31, 2023, and $21,401 as of December 31, 2022. For the year ended December 31, 2024, no capital loss carryforwards expired. The Group utilized some existing capital loss carryforward in the amount of $10 in 2024, resulting in a capital loss carryforward going into 2025. The Group completed a Section 382 study through December 31, 2024 in accordance with the Internal Revenue Code of 1986, as amended. The study concluded that the Group has not experienced an ownership change since the last ownership change on January 31, 2018. If the Group experiences an ownership change, tax credit carryforwards can be utilized but are limited each year and could expire before being fully utilized. The Directors expect the tax credit carryforwards, limited by the January 31, 2018 ownership change, to be fully available for utilization by 2025. Note 9 - Earnings (Loss) Per Share (Amounts in thousands, except share, per share and per unit data) Basic earnings (loss) per share are calculated based on net income (loss) and the weighted average number of shares outstanding during the period. Diluted earnings per share is based on net income and the weighted average number of shares outstanding, plus the weighted average number of shares that would be issued if dilutive share-based compensation awards were converted into shares on the last day of the reporting period. For both basic and diluted earnings (loss) per share calculations, the weighted average number of shares outstanding excludes shares held as treasury shares in the Employee Benefit Trust (“EBT”), which are treated the same as shares held in the treasury reserve for accounting purposes. Refer to Note 16 for additional information regarding the EBT. Basic and diluted earnings (loss) per share were calculated as follows for the periods presented: Year Ended Calculation December 31, 2024 December 31, 2023 December 31, 2022 Net income (loss) attributable to Owners of Diversified Energy Company PLC A $(88,272) $758,018 $(625,410) Weighted average shares outstanding - basic B 48,031,916 47,165,380 42,203,974 Dilutive impact of potential shares — 349,141 — Weighted average shares outstanding - diluted C 48,031,916 47,514,521 42,203,974 Earnings (loss) per share - basic = A/B $(1.84) $16.07 $(14.82) Earnings (loss) per share - diluted = A/C $(1.84) $15.95 $(14.82) Potentially dilutive shares(a) 640,568 54,133 766,723 (a) Outstanding share-based compensation awards excluded from the diluted EPS calculation because their effect would have been anti-dilutive. 112 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Note 10 - Natural Gas & Oil Properties (Amounts in thousands, except share, per share and per unit data) The following table summarizes the Group's natural gas and oil properties for the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Costs Beginning balance $3,206,739 $3,062,463 $2,866,353 Additions(a) 655,080 353,888 219,490 Disposals(b) (42,627) (209,612) (23,380) Ending balance $3,819,192 $3,206,739 $3,062,463 Depletion and impairment Beginning balance $(716,364) $(506,655) $(336,275) Depletion expense (197,126) (168,093) (170,380) Impairment — (41,616) — Ending balance $(913,490) $(716,364) $(506,655) Net book value $2,905,702 $2,490,375 $2,555,808 (a) For the year ended December 31, 2024 , the Group added $613,401 from material acquisitions and $6,521 from normal revisions to the Group’s asset retirement obligations. The remaining changes were primarily due to recurring capital expenditures. In 2023, the Group added $266,306 from acquisitions and $42,650 from normal revisions to the Group’s asset retirement obligations. The remaining changes were primarily due to recurring capital expenditures. In 2022, the Group added $285,212 from acquisitions and $98,802 from normal revisions to the Group’s asset retirement obligations. The remaining additions were primarily due to capital expenditures for completing five Tapstone wells under development as of December 31, 2021, and seven additional wells in which the Group participated with a non- operating interest in Appalachia. The remaining changes were primarily due to recurring capital expenditures. (b) For the year ended December 31, 2024 , the Group divested $32,736 in undeveloped acreage. In 2023, the Group divested $202,886 in natural gas and oil properties related to the sale of equity interest in DP Lion Equity Holdco LLC, the divested assets previously acquired as part of the ConocoPhillips Asset Acquisition, and other proved properties and undeveloped acreage divestitures. Disposals for the year ended December 31, 2022 were associated with divestitures of natural gas and oil properties in the normal course of business, none of which were material. Impairment Assessment for Natural Gas and Oil Properties For the period ended December 31, 2024, the Directors assessed indicators of impairment, noting that commodity prices showed moderate strengthening. As a result of this assessment, no indicators of impairment were identified for the year ended December 31, 2024. For the year ended December 31, 2023, the Group determined that the carrying amounts of certain proved properties for two fields were not recoverable from future cash flows and recognized an impairment charge of $41,616. No such impairment was recorded during the year ended December 31, 2022. Note 11 - Property, Plant & Equipment (Amounts in thousands, except share, per share and per unit data) The following tables summarize the Group’s property, plant and equipment for the periods presented: Year Ended December 31, 2024 Buildings and Leasehold Improvements Equipment Motor Vehicles Midstream Assets Other Property and Equipment Total Costs Beginning balance $48,255 $32,236 $71,175 $455,128 $26,293 $633,087 Additions(a) 2,978 3,066 19,243 22,597 2,614 50,498 Disposals (1,391) (3,577) (7,473) (1,575) (658) (14,674) Ending balance(b) $49,842 $31,725 $82,945 $476,150 $28,249 $668,911 Accumulated depreciation Beginning balance $(4,161) $(8,722) $(36,142) $(123,458) $(4,396) $(176,879) Period changes (1,626) (3,400) (13,990) (31,054) (3,412) (53,482) Disposals 599 2,325 5,935 1,473 658 10,990 Ending balance $(5,188) $(9,797) $(44,197) $(153,039) $(7,150) $(219,371) Net book value $44,654 $21,928 $38,748 $323,111 $21,099 $449,540 113 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Year Ended December 31, 2023 Buildings and Leasehold Improvements Equipment Motor Vehicles Midstream Assets Other Property and Equipment Total Costs Beginning balance $47,682 $30,369 $66,389 $433,484 $23,743 $601,667 Additions(a) 1,134 3,964 11,715 21,644 4,039 42,496 Disposals (561) (2,097) (6,929) — (1,489) (11,076) Ending balance(b) $48,255 $32,236 $71,175 $455,128 $26,293 $633,087 Accumulated depreciation Beginning balance $(3,607) $(7,627) $(29,194) $(95,826) $(2,553) $(138,807) Period changes (581) (3,024) (12,887) (27,632) (2,720) (46,844) Disposals 27 1,929 5,939 — 877 8,772 Ending balance $(4,161) $(8,722) $(36,142) $(123,458) $(4,396) $(176,879) Net book value $44,094 $23,514 $35,033 $331,670 $21,897 $456,208 Year Ended December 31, 2022 Buildings and Leasehold Improvements Equipment Motor Vehicles Midstream Assets Other Property and Equipment Total Costs Beginning balance $41,684 $9,492 $45,562 $398,663 $16,039 $511,440 Additions(a) 9,421 20,886 22,399 34,835 7,704 95,245 Disposals (3,423) (9) (1,572) (14) — (5,018) Ending balance(b) $47,682 $30,369 $66,389 $433,484 $23,743 $601,667 Accumulated depreciation Beginning balance $(2,078) $(4,089) $(20,186) $(69,501) $(1,606) $(97,460) Period changes (1,819) (3,547) (10,270) (26,330) (947) (42,913) Disposals 290 9 1,262 5 — 1,566 Ending balance $(3,607) $(7,627) $(29,194) $(95,826) $(2,553) $(138,807) Net book value $44,075 $22,742 $37,195 $337,658 $21,190 $462,860 (a) Of the $50,498 in additions for 2024 , $2,036 was related to acquisitions and $19,007 was associated with right-of-use asset additions for new leases. Of the $42,496 in additions for 2023, $234 was related to acquisitions and $13,279 was associated with right-of-use asset additions for new leases. Of the $95,245 in additions for 2022 , $26,815 was related to acquisitions and $11,295 was associated with right-of-use asset additions for new leases. The remaining capital expenditures were due to recurring capital needs and enhanced sustainability efforts. Refer to Notes 5 and 20 for additional information regarding acquisitions and leases, respectively. The remaining additions were related to routine capital projects on the Group’s compressor and gathering systems, as well as vehicle and equipment additions. (b) Buildings and leasehold improvements and motor vehicles include right-of-use assets associated with the Group’s leases. Refer to Note 20 for additional information regarding leases. The Group continued to utilize certain fully depreciated assets during the years ended December 31, 2024, 2023 and 2022 with an original cost basis of $29,179, $6,546 and $9,222 , respectively. 114 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Note 12 - Intangible Assets (Amounts in thousands, except share, per share and per unit data) Intangible assets consisted of the following for the periods presented: Year Ended December 31, 2024 Software Other Acquired Intangibles Total Costs Beginning balance $44,449 $4,224 $48,673 Additions(a) 1,883 — 1,883 Disposals (3,990) (362) (4,352) Ending balance $42,342 $3,862 $46,204 Accumulated amortization Beginning balance $(28,500) $(822) $(29,322) Period changes (5,554) (500) (6,054) Disposals 3,990 362 4,352 Ending balance $(30,064) $(960) $(31,024) Net book value $12,278 $2,902 $15,180 Year Ended December 31, 2023 Software Other Acquired Intangibles Total Costs Beginning balance $39,306 $7,124 $46,430 Additions(a) 5,949 — 5,949 Disposals (806) (2,900) (3,706) Ending balance $44,449 $4,224 $48,673 Accumulated amortization Beginning balance $(22,517) $(2,815) $(25,332) Period changes (6,789) (907) (7,696) Disposals 806 2,900 3,706 Ending balance $(28,500) $(822) $(29,322) Net book value $15,949 $3,402 $19,351 Year Ended December 31, 2022 Software Other Acquired Intangibles Total Costs Beginning balance $28,095 $2,900 $30,995 Additions(a) 11,211 4,224 15,435 Disposals — — — Ending balance $39,306 $7,124 $46,430 Accumulated amortization Beginning balance $(15,192) $(1,669) $(16,861) Period changes (7,325) (1,146) (8,471) Disposals — — — Ending balance $(22,517) $(2,815) $(25,332) Net book value $16,789 $4,309 $21,098 (a) For the years ended December 31, 2024 , 2023 and 2022 additions were related to software enhancements and other acquired intangibles. Note 13 - Derivative Financial Instruments 115 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements (Amounts in thousands, except share, per share and per unit data) The Group faces volatility in market prices and basis differentials for natural gas, NGLs and oil, affecting the predictability of its cash flows from commodity sales. Additionally, the Group’s cash flows related to interest payments variable rate debt obligations can be impacted by fluctuations in interest rate markets, depending on its debt structure. To manage these risks, the Group utilizes various derivative financial instruments. As of December 31, 2024, these instruments included swaps, collars, basis swaps, stand-alone put and call options, and swaptions. Below is a description of these instruments: Swaps: When the Group sells a swap, it agrees to receive a fixed price for the contract while paying a floating market price to the counterparty; Collars: Arrangements that include a fixed floor price (purchased put option) and a fixed ceiling price (sold call option) based on an index price have no net costs overall. At the contract settlement date, (1) when the index price is higher than the ceiling price, the Group pays the counterparty the difference between the index price and ceiling price, (2) when the index price is between the floor and ceiling prices, no payments are due from either party, and (3) when the index price is below the floor price, the Group will receive the difference between the floor price and the index price. Some collar arrangements may also include a sold put option with a strike price below the purchased put option. Known as a three- way collar, the structure operates similarly to the standard collar. However, when the index price settles below the sold put option, the Group pays the counterparty the difference between the index price and sold put option, effectively enhancing realized pricing by the difference between the price of the sold and purchased put options; Basis swaps: Arrangements that guarantee a price differential for commodities from a specified delivery point. When the Group sells a basis swap, it receives a payment from the counterparty if the price differential exceeds the stated terms of the contract. Conversely, if the price differential is less than the stated terms, the Group pays the counterparty; Put options: The Group purchases and sells put options in exchange for a premium. When the Group purchases a put option, it receives from the counterparty the excess amount (if any) by which the market price falls below the strike price of the put option at the time of settlement. If the market price is above the put option’s strike price, no payment is required from either party. Conversely, when the Group sells a put option, it pays the counterparty the excess amount (if any) by which the market price falls below the strike price of the put option at the time of settlement. If the market price is above the put option’s strike price, no payment is required from either party; Call options: The Group purchases and sells call options in exchange for a premium. When the Group purchases a call option, it receives from the counterparty the excess amount (if any) by which the market price exceeds the strike price of the call option at the time of settlement. If the market price is below the call option’s strike price, no payment is required from either party. When the Group sells a call option, it pays the counterparty the excess amount (if any) by which the market price exceeds the strike price of the call option at the time of settlement. If the market price is below the call option’s strike price, no payment is required from either party; and Swaptions: When the Group sells a swaption, the counterparty receives the option to enter into a swap contract at a specified price to be paid on the exercise date. If the counterparty exercises the swaption, the Group pays a floating market price to the counterparty and receives the fixed swap price from the counterparty. The Group may elect to enter into offsetting transactions for the above instruments for the purpose of cancelling or terminating certain positions. The following tables summarize the Group's calculated net fair value of derivative financial instruments as of the reporting date as follows: Natural Gas Contracts Weighted Average Price per Mcfe(a) Volume Sold Purchased Sold Purchased Basis Fair Value at (Mmbtu) Swaps Puts Puts Calls Calls Differential December 31, 2024 2025 Swaps 213,686 $3.30 $— $— $— $— $— $(67,387) Two-way collars 3,650 — — — 3.83 3.63 — 171 Three-way collars 7,300 — 2.18 3.21 3.63 — — (1,635) Stand-alone calls, net(b) 9,464 — — — 3.59 — — (10,689) Basis swaps 232,542 — — — — — (0.62) (23,810) 2026 Swaps 171,222 3.25 — — — — — (124,800) Two-way collars 3,650 — — — 5.18 3.11 — (443) Stand-alone calls, net(b) 19,777 — — — 3.63 — — (36,803) Basis swaps 107,801 — — — — — (0.53) (7,508) 2027 Swaps 147,104 3.25 — — — — — (92,004) Two-way collars 6,409 — — 3.55 5.94 — — 929 Stand-alone calls, net(b) 10,950 — — — 3.63 — — (28,776) Basis swaps 23,301 — — — — — (0.46) (1,810) 116 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Natural Gas Contracts Weighted Average Price per Mcfe(a) Volume Sold Purchased Sold Purchased Basis Fair Value at (Mmbtu) Swaps Puts Puts Calls Calls Differential December 31, 2024 2028 Swaps 109,226 2.86 — — — — — (90,554) Two-way collars 10,502 — — 4.14 6.68 — — 6,578 Stand-alone calls, net(b) 3,660 — — — 3.83 — — (4,166) Purchased puts 7,978 — — 3.11 — — — 2,890 Sold puts 7,978 — 3.11 — — — — (2,890) Basis swaps 7,557 — — — — — (0.36) (662) 2029 Swaps 73,265 2.70 — — — — — (58,058) Two-way collars 28,251 — — 3.76 5.07 — — 7,948 Basis swaps 3,594 — — — — — (0.39) (449) 2030 Swaps 19,448 2.78 — — — — — (13,352) Two-way collars 30,099 — — 3.63 4.26 — — 5,934 Three-way collars 6,276 — 1.86 3.14 3.89 — — (1,306) 2031 Two-way collars 38,595 — — 3.63 4.24 — — 9,728 Three-way collars 5,909 — 1.86 3.14 3.89 — — (974) 2032 Two-way collars 9,190 — — 3.63 4.24 — — (327) Three-way collars 2,824 — 1.86 3.14 3.89 — — (428) Swaptions 4/1/2026-3/31/2030(c) 82,171 2.49 — — — — — (89,575) 4/1/2030-3/31/2032(d) 42,627 2.49 — — — — — (37,307) Total natural gas contracts 1,446,006 $(661,535) (a) Rates have been converted from Btu to Mcfe using a Btu conversion factor of 1.04. (b) Future cash settlements for deferred premiums. (c) Option expires on March 23, 2026 . (d) Option expires on March 22, 2030. NGLs Contracts Weighted Average Price per Bbl Volume Sold Fair Value at (MBbls) Swaps Calls December 31, 2024 2025 Swaps 3,692 $33.98 $— $(13,667) Stand-alone calls 913 — 30.07 (5,013) 2026 Swaps 3,195 32.38 — (6,626) Stand-alone calls 913 — 27.83 (6,757) 2027 Swaps 2,249 32.29 — (3,459) 2028 Swaps 267 28.91 — (623) Total NGLs contracts 11,229 $(36,145) 117 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Oil Contracts Weighted Average Price per Bbl Volume Purchased Sold Fair Value at (MBbls) Swaps Puts Calls December 31, 2024 2025 Swaps 1,409 $62.44 $— $— $(7,379) Sold calls 110 — — 70.50 (509) 2026 Swaps 779 62.44 — — (2,946) Sold calls 110 — — 67.50 (832) 2027 Swaps 623 62.67 — — (1,236) Total oil contracts 3,031 $(12,902) Interest Principal Hedged Fair Value at Fixed-Rate December 31, 2024 SOFR Interest Rate Swap $5,520 4.15% 235 Net fair value of derivative financial instruments as of December 31, 2024 $(710,347) When derivative assets and liabilities are with the same counterparty and a legal right of set-off exists under a master netting arrangement, netting their fair values for financial reporting purposes is permitted. The Directors have elected to present these derivative assets and liabilities on a net basis when these conditions are satisfied. The following table outlines the Group’s net derivatives as of the periods presented: Derivative Financial Instruments Consolidated Statement of Financial Position December 31, 2024 December 31, 2023 Assets: Non-current assets Derivative financial instruments $28,439 $24,401 Current assets Derivative financial instruments 33,759 87,659 Total assets $62,198 $112,060 Liabilities Non-current liabilities Derivative financial instruments $(608,869) $(623,684) Current liabilities Derivative financial instruments (163,676) (45,836) Total liabilities $(772,545) $(669,520) Net assets (liabilities): Net assets (liabilities) - non-current Other non-current assets (liabilities) $(580,430) $(599,283) Net assets (liabilities) - current Other current assets (liabilities) (129,917) 41,823 Total net assets (liabilities) $(710,347) $(557,460) The Group presents the fair value of derivative contracts on a net basis in the Consolidated Statement of Financial Position. Below is the impact of this presentation on the Group’s recognized assets and liabilities for the specified periods: December 31, 2024 Presented without Effects of Netting Effects of Netting As Presented with Effects of Netting Non-current assets $90,635 $(62,196) $28,439 Current assets 77,801 (44,042) 33,759 Total assets $168,436 $(106,238) $62,198 Non-current liabilities (671,300) 62,431 (608,869) Current liabilities (207,483) 43,807 (163,676) Total liabilities $(878,783) $106,238 $(772,545) Total net assets (liabilities) $(710,347) $— $(710,347) 118 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements December 31, 2023 Presented without Effects of Netting Effects of Netting As Presented with Effects of Netting Non-current assets $103,008 $(78,607) $24,401 Current assets 198,806 (111,147) 87,659 Total assets $301,814 $(189,754) $112,060 Non-current liabilities (678,053) 54,369 (623,684) Current liabilities (181,221) 135,385 (45,836) Total liabilities $(859,274) $189,754 $(669,520) Total net assets (liabilities) $(557,460) $— $(557,460) The Group recorded the following gains (losses) on derivative financial instruments in the Consolidated Statement of Comprehensive Income for the specified periods: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Net gain (loss) on commodity derivatives settlements(a) $151,289 $178,064 $(895,802) Net gain (loss) on interest rate swaps(a) 190 (2,722) (1,434) Gain (loss) on foreign currency hedges(a) — (521) — Total gain (loss) on settled derivative instruments $151,479 $174,821 $(897,236) Gain (loss) on fair value adjustments of unsettled financial instruments(b) (189,030) 905,695 (861,457) Total gain (loss) on derivative financial instruments $(37,551) $1,080,516 $(1,758,693) (a) Represents the cash settlement of hedges that were settled during the period. (b) Represents the change in fair value of financial instruments, net of the carrying value of hedges that were settled during the period. All derivatives are defined as Level 2 instruments because their valuation relies on inputs other than quoted prices, that are observable for the assets and liabilities. Commodity Derivative Contract Modifications and Extinguishments Occasionally, such as during the acquisition of producing assets, the completion of ABS financings, or in response to fluctuating price environments, the Group may strategically modify, offset, terminate, or expand certain existing hedge positions. These modifications can involve changes to the volume of production covered by contracts, the swap or strike price of specific derivative contracts, and other similar aspects of the derivative agreements. The Group manages distinct, long-dated derivative contract portfolios for its ABS financings and Term Loans. Additionally, the Group maintains a separate derivative contract portfolio for assets secured by the Credit Facility. These derivative contract portfolios associated with the Group’s ABS financings, Term Loans , and Credit Facility are presented in the Group’s Statement of Financial Position. The Group made no modifications in 2024. 2023 Modifications and Extinguishments In February 2023, the Group sold puts in ABS III for approximately $9,045 and replaced them with swaps to maintain the appropriate level and composition of derivatives at both the legal entity and full-company level. In August 2023, the Group monetized $9,240 in purchased puts associated with its ABS hedge books and transitioned the monetized positions into long-dated swap agreements. The Group also monetized an additional $8,401 in net modifications, primarily comprised of swap terminations. As these modifications were made in the normal course of business for the year ended December 31, 2023, they are presented as an operating activity in the Consolidated Statement of Cash Flows. In November 2023, the Group adjusted portions of its commodity derivative portfolio across its legal entities to ensure that it maintained the appropriate level and composition at both the legal entity and full-Group level for the completion of the ABS VII financing arrangement. These portfolio adjustments included novations of certain contracts to the legal entities holding the ABS VII Notes. The Group paid $6,376 for these portfolio adjustments. As these modifications were associated with a borrowing transaction, these amounts are presented as a financing activity in the Consolidated Statement of Cash Flows. Refer to Note 21 for additional information regarding ABS financing arrangements. 2022 Modifications and Extinguishments In February 2022, the Group adjusted portions of its commodity derivative portfolio across its legal entities to ensure that it maintained the appropriate level and composition at both the legal entity and full-Group level for the completion of the ABS III and ABS IV financing arrangements. The Group completed these adjustments by entering into new commodity derivative contracts and novating certain derivative contracts to the legal entities holding the ABS III and ABS IV notes. The Group paid $41,823 for these portfolio adjustments, driven primarily by the purchase of long-dated puts for ABS III and ABS IV that collectively increased the value of the Group’s derivative position by an equal amount, and were required under the respective ABS III and ABS IV indentures. The Group recorded payments for offsetting positions as new derivative financial instruments and applied extinguishment payments against the existing commodity contracts in its Consolidated Statement of Financial Position. In May 2022, and in October 2022 the Group completed the ABS V and ABS VI financing arrangements, respectively, and made similar commodity derivative portfolio adjustments to maintain the appropriate level and composition of derivatives at both the legal entity and full-Group level. The Group paid $31,250, driven primarily by the purchase of long-dated puts that increased the value of the Group’s derivative position by an equal amount, and 119 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements were required under the ABS V indenture. Under the ABS VI financing, the Group paid $32,242 from the proceeds of the financing to increase the value of certain pre-existing derivative contracts that were novated to the ABS VI legal entity at closing. The Group recorded the payments as new derivative financial instruments in its Consolidated Statement of Financial Position. Refer to Note 21 for additional information regarding ABS financing arrangements. Other commodity derivative contract modifications made during the normal course of business for the year ended December 31, 2022 totaled $133,573 which the Group recorded in its Consolidated Statement of Financial Position. As these modifications were made in the normal course, the Group has presented these as an operating activity in the Consolidated Statement of Cash Flows. These modifications were primarily associated with elevating the Group’s weighted average hedge floor to take advantage of the high price environment experienced in 2022 over a longer term. The trades were primarily comprised of swap enhancements and the extinguishment of standalone call options. Note 14 - Trade & Other Receivables (Amounts in thousands, except share, per share and per unit data) Trade receivables include amounts due from customers, entities that purchase the Group’s natural gas, NGLs and oil production, as well as amounts due from joint interest owners who hold a working interest in the properties operated by the Group. Most of these trade receivables are current, and the Group is confident in their collectibility. The table below provides a summary of the Group’s trade receivables. The fair value approximates the carrying value as of the periods presented: December 31, 2024 December 31, 2023 Commodity receivables(a) $175,058 $172,045 Other receivables(b) 75,322 34,691 Total trade receivables $250,380 $206,736 Allowance for credit losses(c) (15,959) (16,529) Total trade receivables, net $234,421 $190,207 (a) Commodity receivables include trade receivables and accrued revenues. (b) Other receivables are predominantly comprised of joint interest receivables. (c) The allowance for credit losses mainly pertains to amounts owed by joint interest owners. Note 15 - Other Assets (Amounts in thousands, except share, per share and per unit data) The following table includes details of other assets as of the periods presented: December 31, 2024 December 31, 2023 Other non-current assets Other non-current assets(a) $6,270 $9,172 Total other non-current assets $6,270 $9,172 Other current assets Prepaid expenses $9,077 $3,955 Inventory 9,591 7,829 Total other current assets $18,668 $11,784 (a) Includes the Group’s investment in DP Lion Equity Holdco LLC of $5,566 and $7,500 as of December 31, 2024 and 2023 , respectively. Refer to Notes 5 and 21 for additional information regarding the DP Lion Equity Holdco LLC equity sale. Note 16 - Share Capital (Amounts in thousands, except share, per share and per unit data) The Company has one class of common shares which carry the right to one vote at annual general meetings of the Group. As of December 31, 2024, the Company had unlimited shares authorized and all shares in issue were fully paid. Share capital represents the nominal (par) value of shares (£0.20) that have been issued. Share premium includes any premiums received on issue of share capital above par. Any transaction costs associated with the issuance of shares are deducted from share premium, net of any related income tax benefits. The components of share capital include: Issuance of Share Capital In October 2024 , the Company issued 2,342,445 new ordinary shares direct to the Seller to fund a portion of the of the East Texas II transaction. The total value of the stock consideration was $27,453 based on the Company’s NYSE stock price on the closing date of the East Texas II transaction. In August 2024 , the Company issued 2,249,650 new ordinary shares direct to Crescent Pass to fund a portion of the Crescent Pass transaction. The total value of the stock consideration was $28,413 based on the Company’s NYSE stock price on the closing date of the Crescent Pass transaction. In February 2023, the Company placed 6,422,200 new ordinary shares at $25.34 per share (£21.00) to raise gross proceeds of $162,757 (approximately £134,866). Associated costs of the placing were $5,969 . The Group used the proceeds to fund the Tanos II transaction. 120 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements In 2022 , there were no issuances of share capital for purposes other than share-based compensation awards issued at par which were insignificant for the period. For detailed information regarding the acquisitions mentioned above, refer to Note 5. Treasury Shares The Group’s holdings in its own equity instruments are classified as treasury shares. The consideration paid, along with any directly attributable incremental costs, is deducted from the Group’s stockholders’ equity until the shares are either cancelled or reissued. No gain or loss is recognized in the Consolidated Statement of Comprehensive Income upon the purchase, sale, issuance, or cancellation of treasury shares. Employee Benefit Trust (“EBT”) In March 2022, the Group established the EBT to benefit its employees. The Group provides funding to the EBT to facilitate the acquisition of shares. These shares are held in the EBT to fulfill awards and grants under the Group’s 2017 Equity Incentive Plan and the Employee Share Purchase Plan (the “ESPP”). Shares held in the EBT are treated in the same manner as treasury shares and are thus included in the Consolidated Financial Statements as treasury shares. During the year ended December 31, 2024 , the EBT purchased 418,151 shares at an average price of $12.51 per share (approximately £9.72 ) for a total consideration of $5,229 (approximately £4,065). Additionally, the EBT issued 139,317 shares during the year ended December 31, 2024 to settle vested share-based awards and ESPP purchases. During the year ended December 31, 2023 , the EBT did not purchase any shares. However, during the year ended December 31, 2023, the EBT issued 334,251 to settle vested share-based awards and ESPP purchases. As of December 31, 2024, the EBT held a total of 646,098 shares. For further details related to share-based compensation, refer to Note 17 . Repurchase of Shares During the year ended December 31, 2024 , the Group repurchased 1,219,879 treasury shares at an average price of $13.03 per share, amounting to a total of $15,901 and representing 2% of issued share capital as of December 31, 2024 . During the year ended December 31, 2023, the Group repurchased 646,762 treasury shares at an average price of $17.08 per share, amounting to a total of $11,048 and representing 1% of issued share capital as of December 31, 2023 . The Group has recorded the repurchase of these shares as a reduction in the treasury reserve. All repurchased treasury shares were cancelled upon repurchase. As of December 31, 2024 and 2023, the par value of the cancelled shares amounting to $320 and $161, respectively, was retired into the capital redemption reserve, which is included within share-based payments and other reserves in the Consolidated Statement of Financial Position . Settlement of Warrants In July 2022, the Group entered into an agreement to cancel 6,581 warrants (the "Warrants") held by certain former Mirabaud Securities Limited ("Mirabaud") employees for an aggregate principal amount of approximately $56 (approximately £46). The former employees surrendered the Warrants to the Group for cancellation. Concurrently, the Group entered into an agreement to exercise 11,176 Warrants held by certain former Mirabaud employees for an aggregate principal amount of approximately $201 (approximately £166). The former employees surrendered the Warrants to the Group for cancellation in exchange for an equivalent number of shares of common stock. Following this purchase and exercise, no warrants remain outstanding. In February 2022, the Group entered into an agreement to cancel 23,855 Warrants held by certain former Mirabaud Securities Limited ("Mirabaud") employees for an aggregate principal amount of approximately $265 (approximately £196 ). The former employees surrendered the Warrants to the Group for cancellation. Concurrently, the Group entered into an agreement to exercise 14,519 Warrants held by certain former Mirabaud employees for an aggregate principal amount of approximately $251 (approximately £187). The former employees surrendered the Warrants to the Group for cancellation in exchange for an equivalent number of shares of common stock. Following this purchase and exercise, 17,757 warrants remained outstanding. The following tables summarize the Group's share capital, net of customary transaction costs, for the periods presented: Number of Shares Total Share Capital Total Share Premium Balance as of December 31, 2021 42,482,733 $11,571 $1,052,959 Issuance of share capital (settlement of warrants) 25,695 5 — Issuance of share capital (equity compensation) 39,629 7 — Issuance of EBT shares (equity compensation) 87,998 — — Repurchase of shares (EBT) (789,513) — — Repurchase of shares (share buyback program) (399,769) (80) — Balance as of December 31, 2022 41,446,773 $11,503 $1,052,959 Issuance of share capital (equity placement) 6,422,200 1,555 155,233 Issuance of EBT shares (equity compensation) 334,251 — — Repurchase of shares (share buyback program) (646,762) (161) — Balance as of December 31, 2023 47,556,462 $12,897 $1,208,192 Issuance of share capital (acquisition consideration) 4,592,095 1,185 54,519 Issuance of EBT shares (equity compensation) 139,317 — — Repurchase of shares (EBT) (418,151) — — Repurchase of shares (share buyback program) (1,219,879) (320) — Balance as of December 31, 2024 50,649,844 13,762 1,262,711 121 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Subsequent Events O n March 14, 2025 , the Group announced the completion of its previously announced acquisition of Maverick. The transaction was funded in part through the issuance of 21,194,213 new ordinary shares direct to the unitholders of Maverick. Refer to Note 5 for additional information regarding acquisitions. In February 2025, the Company issued 8,500,000 new ordinary shares at $14.50 per share to raise gross proceeds of $123,250. In addition, the Company has granted the underwriters a 30-day option to purchase up to an additional 850,000 ordinary shares at the public offering price, less underwriting discount. The Group used the net proceeds to repay a portion of the debt incurred in connection with the Maverick acquisition. Note 17 - Non-Cash Share-Based Compensation (Amounts in thousands, except share, per share and per unit data) Equity Incentive Plan The 2017 Equity Incentive Plan (the “Plan”), as amended through April 27, 2021, authorized and reserved for issuance 3,284,031 shares of common stock, which may be issued upon exercise of vested Options or the vesting of RSUs, PSUs and dividend equivalent units (“DEUs”) that are granted under the Plan. As of December 31, 2024, 2,073,269 shares have vested and been issued to Plan participants, 2,095,156 shares have been granted but remain unvested and 461,435 DEUs have accrued and remain unvested. As of December 31, 2023, 1,648,410 shares had vested and been issued to Plan participants, 1,138,708 shares had been granted but remained unvested and 238,020 DEUs had accrued and remained unvested. Refer to the Remuneration Committee’s Report within this Annual Report for additional information regarding the terms of awards issued under the Plan. Options Awards The following table summarizes Options award activity for the respective periods presented: Number of Options(a) Weighted Average Grant Date Fair Value per Share Balance as of December 31, 2021 1,094,629 $8.53 Exercised(b) (398,666) 6.60 Forfeited (319,999) 11.30 Balance as of December 31, 2022 375,964 $8.21 Exercised(b) (2,144) 6.60 Forfeited (153,379) 8.25 Balance as of December 31, 2023 220,441 $8.20 Exercised(b) — — Forfeited (66,810) 11.14 Balance as of December 31, 2024 153,631 $6.93 (a) As of December 31, 2024 , 2023 and 2022, 153,631, 162,108 and 19,000 Options were exercisable, respectively. As of December 31, 2024 all remaining Options outstanding have an exercise price ranging from £16.80 to £24.00 and a weighted average remaining contractual life of 2.4 years. (b) No Options were exercised during 2024. The weighted average exercise date share price was $24.29 and $32.35 for Options exercised during 2023 and 2022, respectively. The Group’s Options ratably vested over a three -year period and contained both performance and service metrics. The performance metrics included Adjusted EPS as compared to pre-established benchmarks and a calculation that compared the Group’s TSR to pre-established benchmarks. The number of units that vested ranged between 0% and 100% of the award. The fair value of the Group’s Options was calculated using the Black-Scholes model as of the grant date and was uniformly expensed over the vesting periods. No Options were awarded during the years ended December 31, 2024, 2023 and 2022. 122 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements RSU Awards The following table summarizes RSU equity award activity for the respective periods presented: Number of Shares Weighted Average Grant Date Fair Value per Share Balance as of December 31, 2021 206,681 $26.76 Granted 198,504 27.70 Vested (63,735) 25.92 Forfeited (4,445) 27.24 Balance as of December 31, 2022 337,005 $27.47 Granted 252,869 22.35 Vested (181,275) 23.08 Forfeited (102,018) 27.54 Balance as of December 31, 2023 306,581 $25.82 Granted 764,411 12.40 Vested (65,293) 30.97 Forfeited (29,477) 20.08 Balance as of December 31, 2024 976,222 $15.14 RSUs can vest either on a cliff basis or ratably, depending on the service conditions set forth. The fair value of the Group’s RSUs is calculated using the stock price at the grant date. This value is then expensed uniformly over the vesting period. PSU Awards The following table summarizes PSU equity award activity for the respective periods presented: Number of Shares Weighted Average Grant Date Fair Value per Share Balance as of December 31, 2021 340,204 $23.90 Granted 231,980 28.04 Forfeited (3,695) 26.07 Balance as of December 31, 2022 568,489 $25.57 Granted 349,028 16.66 Vested (216,313) 23.85 Forfeited (89,518) 20.30 Balance as of December 31, 2023 611,686 $21.87 Granted 525,596 9.10 Vested (93,256) 18.90 Forfeited (78,723) 19.37 Balance as of December 31, 2024 965,303 $15.41 PSUs are subject to cliff vesting based on specific performance criteria evaluated over a three-year period. These criteria include the average adjusted return on equity over three years, measured against pre-established benchmarks. Additionally, the Group’s three-year TSR is compared to determined benchmarks and the TSR of a selected group of peer companies. Other performance metrics include the three-year average growth in free cash flow and the reduction in methane intensity over the same period. Depending on the achievement of these performance targets, the number of units that will vest can vary from 0% to 100% of the initial award. The fair value of the Group’s PSUs is determined using a Monte Carlo simulation model as of the grant date. This calculated fair value is then expensed uniformly over the vesting period. F or PSUs granted during the respective periods presented, the inputs to the Monte Carlo model included the following: December 31, 2024 December 31, 2023 December 31, 2022 Risk-free rate of interest 4.0% 3.3% 1.3% Volatility(a) 38% 31% 37% Correlation with comparator group range 0.02 - 0.32 0.01 - 0.30 0.01 - 0.36 (a) Volatility utilizes the historical volatility for the Group’s share price. 123 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Employee Stock Purchase Plan The Employee Stock Purchase Plan (the “ESPP”), implemented in February 2023, authorized and reserved for issuance 300,000 shares of common stock. During the year ended December 31, 2024, 41,330 shares were purchased by and issued to ESPP participants. During the year ended December 31, 2023 , 15,132 shares were purchased by and issued to ESPP participants. As of December 31, 2024 , 243,538 shares remain available to be purchased. Share-Based Compensation Expense The following table presents the share-based compensation expense for the respective periods presented: December 31, 2024 December 31, 2023 December 31, 2022 Options $49 $292 $(749) RSUs 4,359 2,833 4,210 PSUs 3,827 3,335 4,590 ESPP 51 34 — Total share-based compensation expense $8,286 $6,494 $8,051 Note 18 - Dividends (Amounts in thousands, except share, per share and per unit data) The following table summarizes the Group's dividends declared and paid on the dates indicated: Dividend per Share Record Date Pay Date Shares Outstanding Gross Dividends Paid Date Dividends Declared USD GBP November 15, 2023 $0.875 £0.6844 March 1, 2024 March 28, 2024 47,221,488 $41,319 April 10, 2024 $0.290 £0.2283 May 24, 2024 June 28, 2024 47,062,984 13,648 May 9, 2024 $0.290 £0.2211 August 30, 2024 September 27, 2024 49,005,036 14,211 August 15, 2024 $0.290 £0.2279 November 29, 2024 December 27, 2024 50,642,261 14,686 Paid during the year ended December 31, 2024 $83,864 November 14, 2022 $0.875 £0.7220 March 3, 2023 March 28, 2023 47,868,969 $41,885 March 21, 2023 $0.875 £0.6860 May 26, 2023 June 30, 2023 48,164,650 42,144 May 9, 2023 $0.875 £0.7040 September 1, 2023 September 29, 2023 48,157,129 42,137 September 1, 2023 $0.875 £0.6840 December 1, 2023 December 29, 2023 47,856,570 41,875 Paid during the year ended December 31, 2023 $168,041 October 28, 2021 $0.850 £0.6500 March 4, 2022 March 28, 2022 42,502,328 $36,127 March 22, 2022 $0.850 £0.6860 May 27, 2022 June 30, 2022 42,527,424 36,148 May 16, 2022 $0.850 £0.7320 September 2, 2022 September 26, 2022 42,294,025 35,950 August 8, 2022 $0.850 £0.6900 November 25, 2022 December 28, 2022 41,446,769 35,230 Paid during the year ended December 31, 2022 $143,455 On November 12, 2024 the Group proposed a dividend of $0.29 per share. The dividend will be paid on March 31, 2025 to shareholders on the register on February 28, 2025. This dividend was not approved by shareholders, thereby qualifying it as an “interim” dividend. No liability was recorded in the Group Financial Statements in respect of this interim dividend as of December 31, 2024. Dividends are waived on shares held in the EBT. Subsequent Events On March 17, 2025 the Directors recommended a dividend of $0.29 per share. The dividend will be subject to shareholder approval at the AGM. Provided this dividend was not approved by shareholders as of the reporting date, this represents an “interim” dividend. No liability has been recorded in the Group Financial Statements in respect of this dividend as of December 31, 2024 . Note 19 - Asset Retirement Obligations (Amounts in thousands, except share, per share and per unit data) The Group records a liability for the present value of the estimated future decommissioning costs associated with its natural gas and oil properties. Although productive life of wells varies within our portfolio, we currently anticipate that all existing wells will reach the end of their productive lives and be retired by approximately 2098, in alignment with our reserve calculations, which have been independently evaluated by independent reserves auditors. Additionally, the Group records a liability for the future decommissioning costs of its production facilities and pipelines when required by contract, statute, or constructive obligation. For the years ended December 31, 2024, 2023 and 2022 , no state contractual agreements or statutes related to production facilities and pipelines are expected to impose material obligations on the Group. In estimating the present value of future decommissioning costs for its natural gas and oil properties, the Group considers several factors, including the number and state jurisdictions of wells, current decommissioning costs by state and well type, and the Group’s retirement plan, which is based on state 124 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements requirements and the Group’s capacity to retire wells over their productive lives. The Directors’ assumptions are grounded in the current economic environment and are believed to provide a reasonable basis for estimating the future liability. However, actual decommissioning costs will ultimately depend on future market prices at the time the decommissioning services are performed. Additionally, the timing of decommissioning will vary based on when the fields cease to produce economically, which is influenced by future natural gas and oil prices, factors that are inherently uncertain. The Group incorporates annual inflationary cost increases into its current cost expectations and then discounts the resulting cash flows using a credit- adjusted risk-free discount rate. The inflationary adjustment is based on the U.S. long-term 10-year rate, sourced from consensus economics. In determining the discount rate of the liability, the Group considers treasury rates as well as the Bloomberg 15-year U.S. Energy BB and BBB bond index, which aligns economically with the underlying long-term and unsecured liability. Based on this evaluation, the net discount rates used in the calculation of the decommissioning liability were 3.7% for 2024, 3.4% for 2023, and 3.6% for 2022. The composition of the provision for asset retirement obligations as of the reporting date is detailed below for the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Balance at beginning of period $506,648 $457,083 $525,589 Additions(a) 111,265 3,250 24,395 Accretion 30,868 26,926 27,569 Asset retirement costs (6,724) (5,961) (4,889) Disposals(b) — (17,300) (16,779) Revisions to estimate(c) 6,521 42,650 (98,802) Balance at end of period $648,578 $506,648 $457,083 Less: Current asset retirement obligations 6,436 5,402 4,529 Non-current asset retirement obligations $642,142 $501,246 $452,554 (a) For further details regarding acquisitions and divestitures, refer to Note 5. (b) Disposals are related to the divestiture of natural gas and oil properties. For additional information, refer to Note 10. (c) As of December 31, 2024, the Group performed normal revisions to its asset retirement obligations, which resulted in a $6,521 increase in the liability. This increase was comprised of a $94,957 increase for cost revisions and a $382 increase attributed to retirement timing. Partially offsetting the increase was a $88,818 decrease attributable to a higher discount rate as a result of an increase in bond yield volatility during the year. As of December 31, 2023, the Group performed normal revisions to its asset retirement obligations, which resulted in a $42,650 increase in the liability. This increase was comprised of a $27,830 increase attributable to a lower discount rate as a result of slightly decreased bond yields as compared to 2022 as inflation began to increase at a lower rate and a $16,059 increase for cost revisions. Partially offsetting this increase was a $1,239 change attributed to retirement timing. As of December 31, 2022, the Group performed normal revisions to its asset retirement obligations, which resulted in a $98,802 decrease in the liability. This decrease was comprised of a $144,656 decrease attributable to a higher discount rate as a result of macroeconomic factors spurred by the increase in bond yields which have elevated with U.S. treasuries to combat the current inflationary environment. Partially offsetting this decrease was $29,357 in cost revisions and a $16,497 timing revision for the acceleration of the Group’s retirement plans made possible by asset retirement acquisitions that improved the Group’s asset retirement capacity through the growth of its operational capabilities. Changes to assumptions used in estimating the Group’s asset retirement obligations could significantly affect the carrying value of the liability. A reasonably possible adjustment in these assumptions could have the following impact on the Group’s asset retirement obligations as of December 31, 2024: ARO Sensitivity Scenario 1(a) Scenario 2(b) Discount rate $(159,039) $1,189,627 Timing 41,072 (44,722) Cost 64,956 (64,956) (a) Scenario 1 assumes an increase of the BBB 15-year discount rate to approximately 7% (which is one of the highest rates observed since 2020), a 10% increase in cost and a 10% increase in timing by assuming the addition of one plugging rig, which would accelerate retirement plans. All of these scenarios have been either historically observed or are considered reasonably possible. (b) Scenario 2 assumes a decrease of the BBB 15-year discount rate to approximately 3% (which is one of the lowest rates observed since 2020), a 10% decrease in cost and a 10% decrease in timing by assuming the loss of one plugging rig, which would delay retirement plans. All of these scenarios have been either historically observed or are considered reasonably possible. As of December 31, 2024 and 2023, the Group had no midstream asset retirement obligations. 125 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Note 20 - Leases (Amounts in thousands, except share, per share and per unit data) The Group leased automobiles, equipment and real estate for the periods indicated below. The following is a reconciliation of leases arising from financing activities, along with the balance sheet classification of future minimum lease payments as of the reporting periods presented: Present Value of Minimum Lease Payments December 31, 2024 December 31, 2023 December 31, 2022 Balance at beginning of period $31,122 $28,862 $27,804 Additions(a) 19,253 14,430 11,269 Interest expense(b) 2,649 1,661 1,022 Cash inflows(c) 8,568 — — Cash outflows(d) (16,992) (13,831) (11,233) Balance at end of period $44,600 $31,122 $28,862 Classified as: Current liability $13,776 $10,563 $9,293 Non-current liability 30,824 20,559 19,569 Total $44,600 $31,122 $28,862 (a) The lease additions of $19,253 , $14,430 and $11,269 for the years ended December 31, 2024, 2023 and 2022 , respectively, were primarily due to the expansion of the Group’s fleet, driven by ongoing growth. (b) Included as a component of finance cost. (c) Cash inflows consisted of proceeds from a lease modification for our fleet that was executed in 2024 . (d) Cash outflows consisted of $14,343, $12,169, and $10,211 in principal payments for the years ended December 31, 2024, 2023 and 2022 , respectively, and $2,649, $1,661, and $1,022 in interest payments for the same periods, respectively. Outlined below is the movement in the Group’s right-of-use assets, along with their balance sheet classification as of the reporting periods presented: Right-of-Use Assets December 31, 2024 December 31, 2023 December 31, 2022 Balance at beginning of period $30,014 $27,959 $26,908 Additions(a) 19,007 13,279 11,295 Depreciation (12,965) (11,224) (10,244) Balance at end of period $36,056 $30,014 $27,959 Classified as: Motor vehicles $32,843 $25,592 $23,782 Midstream 1,785 3,136 3,801 Buildings and leasehold improvements 1,428 1,286 376 Total $36,056 $30,014 $27,959 (a) The lease additions of $19,007 , $13,279 and $11,295 for the years ended December 31, 2024, 2023 and 2022, respectively, were attributable to the expansion of the Group’s fleet, driven by ongoing growth. The range of discount rates applied in calculating right-of-use assets and the corresponding lease liabilities, based on the lease term, is detailed below: December 31, 2024 December 31, 2023 December 31, 2022 Discount rates range 2.9% - 7.3% 1.8% - 7.1% 1.8% - 6.3% Expenses related to short-term and low-value lease exemptions applied under IFRS 16, primarily associated with short-term compressor rentals, amounted to $31,129, $30,024 and $25,153 for the years ended December 31, 2024, 2023 and 2022, respectively. These expenses have been included in the Group’s operating expenses, with a significant portion allocated to LOE. 126 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The table below illustrates the maturity schedule of leases as of the periods presented: December 31, 2024 December 31, 2023 December 31, 2022 Not Later Than One Year $13,776 $10,563 $9,293 Later Than One Year and Not Later Than Five Years 30,733 20,559 19,569 Later Than Five Years 91 — — Total $44,600 $31,122 $28,862 Note 21 - Borrowings (Amounts in thousands, except share, per share and per unit data) The Group’s borrowings consist of the following amounts as of the reporting periods presented: December 31, 2024 December 31, 2023 Credit Facility (interest rate of 8.63% and 8.66%, respectively) (a) $284,400 $159,000 Term Loan I (interest rate of 6.50% ) 88,948 106,470 Term Loan II (interest rate of 8.83% ) (a) 83,851 — ABS I Notes (interest rate of 5.00% ) 80,157 100,898 ABS II Notes (interest rate of 5.25% ) 102,431 125,922 ABS III Notes (interest rate of 4.875% ) — 274,710 ABS IV Notes (interest rate of 4.95% ) 79,653 99,951 ABS V Notes (interest rate of 5.78% ) — 290,913 ABS VI Notes (interest rate of 7.50% ) (b) 242,010 159,357 ABS VIII Notes (interest rate of 7.28% ) 585,747 — ABS IX Notes (interest rate of 6.891% ) 75,316 — Other miscellaneous borrowings(c) 113,060 7,627 Total borrowings $1,735,573 $1,324,848 Less: Current portion of long-term debt (209,463) (200,822) Less: Deferred financing costs (34,115) (41,123) Less: Original issue discounts (8,216) (7,098) Total non-current borrowings, net $1,483,779 $1,075,805 (a) Represents the variable interest rate as of period end. (b) Includes $132,576 for the assumption of Oaktree’s proportionate share of the ABS VI debt as part of the Oaktree transaction as of December 31, 2024. Refer to Note 5 for additional information regarding the Oaktree transaction. (c) Includes $76,100 in notes payable issued as part of the consideration in the Oaktree transaction, and $30,000 in notes payable issued by a third party financial institution in November 2024, collateralized by two natural gas processing plants and various natural gas compressors and related support equipment in the Central Region, as of December 31, 2024. Refer to Note 5 for additional information regarding the Oaktree transaction. Credit Facility The Group maintains a revolving loan facility (the “Credit Facility”) with a lending syndicate, where the borrowing base is redetermined semi-annually or as needed. The Group’s wholly-owned subsidiary, DP RBL Co LLC, serves as the borrower under its Credit Facility. The borrowing base is primarily determined by the value of the natural gas and oil properties that serve as collateral for the lending arrangement, and it may fluctuate due to changes in collateral, which can result from acquisitions or the establishment of ABS, term loans, or other lending structures. In August 2022 , the Group amended and restated the credit agreement governing its Credit Facility. This amendment aligned the agreement with the Group’s ESG initiatives by incorporating sustainability performance targets (“SPTs”) similar to those included in the ABS IV, VI and VIII notes, and extended the maturity of the Credit Facility to August 2026. During the semi-annual redetermination in October 2024, the borrowing base was reaffirmed at $385,000. The Credit Facility carries an interest rate of SOFR plus an additional spread ranging from 2.75% to 3.75%, depending on utilization, and is payable quarterly. As of December 31, 2024, available borrowings under the Credit Facility were $86,690, which includes the impact of $13,910 in letters of credit issued to certain vendors. The Credit Facility contains certain customary representations, warranties, and both affirmative and negative covenants. These covenants cover areas such as maintenance of books and records, financial reporting and notification, compliance with laws, maintenance of properties and insurance, and limitations on incurrence of indebtedness, liens, fundamental changes, international operations, asset sales, certain debt payments and amendments, restrictive agreements, investments, restricted payments, and hedging. The restricted payment provision governs the Group’s ability to make discretionary payments, such as dividends, share repurchases, or other discretionary payments. DP RBL Co LLC must meet the following criteria to make discretionary payments: (i) leverage is less than 1.5x and borrowing base availability is > 25%; (ii) leverage is between 1.5x and 2.0x, free cash flow must be positive, and borrowing base availability must be >15%; (iii) leverage is between 2.0x and 2.5x, free cash flow must be positive, and borrowing base availability must be >20%; (iv) when leverage exceeds 2.0x, restricted payments are prohibited. 127 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Additional covenants require DP RBL Co LLC to maintain a total debt to EBITDAX ratio of no more than 3.25 to 1.00 and a current assets (with certain adjustments) to current liabilities ratio of no less than 1.00 to 1.00 as of the last day of each fiscal quarter. As of December 31, 2024, the Group was in compliance with all covenants for its Credit Facility. Term Loan I In May 2020 , the Group acquired DP Bluegrass LLC, a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to facilitate a securitized financing agreement for $160,000 , structured as a secured term loan (the “Term Loan I”). The Group issued Term Loan I at a 1% discount, resulting in net proceeds of $158,400, which were used to fund the 2020 Carbon and EQT acquisitions. Term Loan I is secured by certain producing assets acquired in connection with these acquisitions. Term Loan I accrues interest at an annual rate of 6.50% and has a maturity date of May 2030 . Both interest and principal payments on Term Loan I are made on a monthly basis. Term Loan II In August 2024 , the Group formed DP Yellow Jacket Holdco LLC, a limited-purpose, bankruptcy-remote, wholly-owned subsidiary to enter into a securitized financing agreement for a $60,000 term loan and a $5,000 revolving loan for a total borrowing base of $65,000 (the “Term Loan II”). The proceeds from Term Loan II were used, in part, to fund the Crescent Pass acquisition. For additional information regarding acquisitions, refer to Note 5 . In October 2024, the Group amended the Term Loan II and expanded the term loan to $82,651 and the revolving loan to $12,349 for a total borrowing base of $95,000. This amendment was accounted for as an extinguishment, which resulted in a loss of $2,470 and which has been recorded in ‘loss on early retirement of debt’ in the Statement of Comprehensive Income. The expanded borrowing capacity was used to fund a portion of the East Texas II acquisition, and the acquired assets additionally collateralized the expanded Term Loan II. As of December 31, 2024 , available borrowings under the revolving loan were $11,149. The Term Loan II is secured by the Crescent Pass and East Texas II assets and carries an interest at SOFR plus an additional spread ranging from 3.75% to 4.75% and is payable quarterly. The term loan is subject to fixed amortization with monthly principal payments of $500 beginning in February 2025 and escalating to $1,000 beginning in July 2025 with the remaining unpaid principal balance due upon maturity in August 2027. The Term Loan II is to be prepaid if the Group receives cash in connection with an issuance of equity interest or ABS monetization. ABS I Notes In November 2019 , the Group formed Diversified ABS LLC (“ABS I”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue BBB- rated asset-backed securities with a total principal amount of $200,000 at par value (the “ABS I Notes”). These notes are secured by specific upstream producing assets in the Appalachian region owned by the Group. At the time of the agreement, 85% of the natural gas production from these assets was hedged through long-term derivative contracts. The ABS I Notes carry an annual interest rate of 5% and have a legal final maturity date of January 2037, with an amortizing maturity date of December 2029. Both interest and principal payments on the ABS I Notes are made on a monthly basis. If ABS I generates cash flow exceeding the required payments, it must allocate between 50% to 100% of this excess cash flow towards additional principal payments, depending on certain performance metrics, with any remaining excess cash flow retained by the Group. Specifically, (a) for any payment date before March 1, 2030, (i) if the debt service coverage ratio (the “DSCR”) on that date is at least 1.25 to 1.00, then 25% of the excess cash flow, (ii) if the DSCR is between 1.15 to 1.00 and 1.25 to 1.00, then 50%, and (iii) if the DSCR is below 1.15 to 1.00, the production tracking rate for ABS I is below 80%, or the loan to value ratio exceeds 85%, then 100% of the excess cash flow must be used for additional principal payments; and (b) for any payment date on or after March 1, 2030, 100% of the excess cash flow must be used for additional principal payments. ABS II Notes In April 2020 , the Group formed Diversified ABS Phase II LLC (“ABS II”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue BBB- rated asset-backed securities with a total principal amount of $200,000 (the “ABS II Notes”). These notes were issued at a 2.775% discount. The Group utilized the net proceeds of $183,617 , after accounting for the discount, capital reserve requirement, and debt issuance costs, to reduce its Credit Facility. The ABS II Notes are secured by specific upstream producing assets in the Appalachian region owned by the Group. at the time of the agreement, 85% of the natural gas production from these assets was hedged through long-term derivative contracts. The ABS II Notes carry an annual interest rate of 5.25% and have a legal final maturity date of July 2037, with an amortizing maturity date of September 2028 . Both interest and principal payments on the ABS II Notes are made on a monthly basis. If ABS II generates cash flow exceeding the required payments, it must allocate between 50% to 100% of this excess cash flow towards additional principal, depending on certain performance metrics, with any remaining excess cash flow retained by the Group. Specifically, (a) (i) if the DSCR on any payment date is below 1.15 to 1.00, then 100% of the excess cash flow must be used for additional principal payments, (ii) if the DSCR is between 1.15 to 1.00 and 1.25 to 1.00, then 50%, or (iii) if the DSCR is at least 1.25 to 1.00, then 0%; (b) if the production tracking rate for ABS II is below 80%, then 100%, otherwise 0%; (c) if the loan-to-value ratio (the “LTV”) exceeds 65.0%, then 100%, otherwise 0% ; (d) for any payment date after July 1, 2024 and before July 1, 2025, if the LTV exceeds 40% and ABS II has executed hedging agreements for a minimum period of 30 months starting July 2026 covering production volumes of at least 85% but no more than 95% (the “Extended Hedging Condition”), then 50%, otherwise 0% ; (e) for any payment date after July 1, 2025, and before October 1, 2025, if the LTV exceeds 40% or ABS II has not satisfied the Extended Hedging Condition, then 50%, otherwise 0%; and (f) for any payment date after October 1, 2025, if the LTV exceeds 40% or ABS II has not satisfied the Extended Hedging Condition, then 100%, otherwise 0%. ABS III Notes In February 2022 , the Group formed Diversified ABS III LLC (“ABS III”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue BBB rated asset-backed securities with a total principal amount of $365,000 at par value (the “ABS III Notes”). These notes were secured by certain upstream producing and midstream assets in the Appalachian region owned by the Group. The ABS III Notes carried an interest rate of 4.875% and had a legal final maturity date of April 2039, with an amortizing maturity date of November 2030 . Both interest and principal payments on the ABS III Notes were made on a monthly basis. If ABS III generated cash flow exceeding the required payments, it was obligated to allocate between 50% to 100% of this excess cash flow towards additional principal payments, depending on certain performance metrics, with any remaining excess cash flow retained by the Group. Specifically, (a) (i) if the DSCR on any payment date was at least 1.25 to 1.00, then 0% of the excess cash flow was used for additional principal payments , (ii) if the 128 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements DSCR was between 1.15 to 1.00 and 1.25 to 1.00, then 50% , and (iii) if the DSCR was below 1.15 to 1.00, then 100%; (b) if the production tracking rate for ABS III was below 80%, then 100%, otherwise 0%; and (c) if the LTV for ABS III exceeded 65%, then 100%, otherwise 0% . In May 2024, the Group utilized proceeds from the ABS VIII Notes to repay the outstanding principal of the ABS III & ABS V notes, thereby retiring these notes from the Group’s outstanding debt. The transaction resulted in a loss on the early retirement of debt amounting to $10,649. Concurrently, ABS III and ABS V were dissolved. The ABS VIII Notes are secured by the collateral that previously secured the ABS III & ABS V notes. ABS IV Notes In February 2022 , the Group formed Diversified ABS IV LLC (“ABS IV”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue BBB rated asset-backed securities with a total principal amount of $160,000 at par value (the “ABS IV Notes”). These notes are secured by a portion of the upstream producing assets acquired through the Blackbeard Acquisition. The ABS IV Notes carry an annual interest rate of 4.95% and have a legal final maturity date of February 2037 , with an amortizing maturity date of September 2030. Both i nterest and principal payments on the ABS IV Notes are made on a monthly basis. If ABS IV generates cash flow exceeding the required payments, it must allocate between 50% to 100% of this excess cash flow towards additional principal payments, depending on certain performance metrics, with any remaining excess cash flow retained by the Group. Specifically, (a) (i) if the DSCR on any payment date is at least 1.25 to 1.00, then 0% of the excess cash flow was used for additional principal payments, (ii) if the DSCR is between 1.15 to 1.00 and 1.25 to 1.00, then 50% , and (iii) if the DSCR is below 1.15 to 1.00, then 100%; (b) if the production tracking rate for ABS IV is below 80%, then 100%, otherwise 0%; and (c) if the LTV for ABS IV exceeds 65%, then 100% , otherwise 0%. ABS V Notes In May 2022 , the Group formed Diversified ABS V LLC (“ABS V”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue BBB rated asset-backed securities with a total principal amount of $445,000 at par value (the “ABS V Notes”). These notes are secured by a majority of the Group’s remaining upstream assets in the Appalachian region that were not included in previous ABS transactions. The ABS V Notes carry an annual interest rate of 5.78% and have a legal final maturity date of May 2039, with an amortizing maturity date of December 2030. Both interest and principal payments on the ABS V Notes are made on a monthly basis. If ABS V generates cash flow exceeding the required payments, it must allocate between 50% to 100% of this excess cash flow towards additional principal payments, depending on certain performance metrics, with any remaining excess cash flow retained by the Group. Specifically, (a) (i) if the DSCR on any payment date is at least 1.25 to 1.00, then 0% of the excess cash flow was used for additional principal payments, (ii) if the DSCR is between 1.15 to 1.00 and 1.25 to 1.00, then 50% , and (iii) if the DSCR is below 1.15 to 1.00, then 100% ; (b) if the production tracking rate for ABS V is below 80%, then 100%, otherwise 0%; and (c) if the LTV for ABS V exceeds 65% , then 100%, otherwise 0%. In May 2024, the Group utilized proceeds from the ABS VIII Notes to repay the outstanding principal of the ABS III & ABS V notes, thereby retiring these notes from the Group’s outstanding debt. The transaction resulted in a loss on the early retirement of debt amounting to $10,649. Concurrently, ABS III and ABS V were dissolved. The ABS VIII Notes are secured by the collateral that previously secured the ABS III & ABS V notes. ABS VI Notes In October 2022 , the Group formed Diversified ABS VI LLC (“ABS VI”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue, jointly with Oaktree, BBB+ rated asset-backed securities with a total principal amount of $460,000 . The Group’s share amounted to $235,750 before fees, reflecting its 51.25% ownership interest in the collateral assets (the “ABS VI Notes”). The ABS VI Notes were issued at a 2.63% discount and are primarily secured by the upstream assets jointly acquired with Oaktree in the Tapstone acquisition. The Group recorded its proportionate share of the ABS VI Notes in its Consolidated Statement of Financial Position. In June, 2024, as part of the Oaktree transaction, the Group assumed Oaktree’s proportionate debt of $132,576 associated with the ABS VI Notes. For additional details regarding the Oaktree transaction, refer to Note 5. These notes carry an annual interest rate of 7.50% and have a legal final maturity date of November 2039, with an amortizing maturity date of October 2031 . Both interest and principal payments on the ABS VI Notes are made on a monthly basis. If ABS VI achieves certain performance metrics, it is required to allocate 50% to 100% of any excess cash flow towards additional principal payments. Specifically, (a) (i) If the DSCR as of the applicable payment date is below 1.15 to 1.00, then 100% of the excess cash flow was used for additional principal payments, (ii) if the DSCR is between 1.15 to 1.00 and 1.25 to 1.00, then 50%, or (iii) if the DSCR is at least 1.25 to 1.00, then 0% ; (b) if the production tracking rate for ABS VI is below 80%, then 100%, otherwise 0%; and (c) if the LTV for ABS VI exceeds 75% , then 100%, else 0%. ABS VII Notes In November 2023, the Group formed DP Lion Equity Holdco LLC (“ABS VII”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue Class A and Class B asset-backed securities (the “Class A Notes,” Class B Notes,” and collectively the “ABS VII Notes”). These notes are secured by certain upstream producing assets in the Appalachia region. The ABS VII Class A Notes, rated BBB+, were issued with a total principal amount of $142,000 , while the ABS VII Class B Notes, rated BB- , were issued with a total principal amount of $20,000 . The Class A Notes carry an annual interest rate of 8.243% and have a legal final maturity date of November 2043, with an amortizing maturity date of February 2034. The Class B Notes carry an annual interest rate of 12.725% and have a legal final maturity date of November 2043 , with an amortizing maturity date of August 2032. Both interest and principal payments on the Class A and Class B Notes are made on a monthly basis. In December 2023, the Group divested 80% of the equity ownership in ABS VII to outside investors, generating cash proceeds of $30,000. Upon evaluating the remaining 20% interest in ABS VII, the Group determined that the governance structure does not allow it to exercise control, joint control, or significant influence over the entity. Consequently, ABS VII is not consolidated within the Group’s financial statements. The Group’s remaining investment in ABS VII, initially valued at $7,500 was accounted for at fair value in accordance with IFRS 9, Financial Instruments (“IFRS 9”). For additional information regarding the ABS VII equity sale, refer to Note 5. As of December 31, 2024, the Group’s investment in ABS VII was valued at $5,566. ABS VIII Notes In May 2024 , the Group formed Diversified ABS VIII LLC (“ABS VIII”), a limited-purpose, bankruptcy-remote, wholly-owned subsidiary, to issue Class A-1 and Class A-2 asset-backed securities (the “Class A-1 Notes,” “Class A-2 Notes,” and collectively the “ABS VIII Notes”). The Class A-1 Notes, rated A, were issued with a total principal amount of $400,000, while the Class A-2 Notes, rated BBB+, were issued with a total principal amount of $210,000. The proceeds from these issuances were used to repay the outstanding principal of the ABS III & ABS V notes, effectively retiring those notes from the Group’s outstanding debt. Consequently, ABS III and ABS V were dissolved. The ABS VIII Notes are secured by the collateral that previously secured the 129 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements ABS III and ABS V notes, which includes certain upstream producing and midstream assets in the Appalachian region owned by the Group, and the remaining upstream assets in the Appalachian region that were not securitized by previous ABS transactions. The Class A-1 Notes carry an annual interest rate of 7.076% and have a legal final maturity date of May 2044. The Class A-2 Notes carry an annual interest rate of 7.670% and have a legal final maturity date of May 2044. Both interest and principal payments on the ABS VIII Notes are made on a monthly basis. If ABS VIII achieves certain performance metrics, it is required to allocate 25% to 100% of any excess cash flow towards additional principal payments. Specifically, (a) (i) if the DSCR as of the applicable payment date is below 1.45 to 1.00, then 100%, (ii) if the DSCR is between 1.45 to 1.00 and 1.50 to 1.00, then 50%, or (iii) if the DSCR is at least 1.50 to 1.00, then 25%; (b) if the production tracking rate for ABS VIII is below 80%, then 100%, otherwise 25%; or (c) if the LTV for ABS VIII exceeds 75%, then 100%, otherwise 25%. ABS IX Notes I n June 2024 , the Group formed DP Mustang Holdco LLC, a limited-purpose, bankruptcy-remote, wholly-owned subsidiary (“ABS IX,” formerly “ABS Facility Warehouse”), to secure a bridge loan facility (the “ABS Facility Warehouse Notes”). The initial draw on the ABS Facility Warehouse Notes amounted to $71,000, which included $66,343 in net proceeds, $3,060 in restricted cash interest reserve, and $1,597 in debt issuance costs. The ABS Facility Warehouse Notes were secured by certain producing assets that previously collateralized the Credit Facility. It carried an interest rate of SOFR plus an additional 3.75% and had a legal final maturity date of May 2029. Both interest and principal payments on the ABS Facility Warehouse Notes were made on a monthly basis. In September 2024, the Group issued Class A and Class B asset-backed securities (the “Class A Notes,” “Class B Notes,” and collectively the “ABS IX Notes”) with a total principal amount of $76,500. The Class A Notes were issued with a total principal amount of $71,000, while the Class B Notes were issued with a total principal amount of $5,500. The proceeds from these issuances were used to repay the outstanding principal of the ABS Facility Warehouse Notes, effectively retiring it from the Group’s outstanding debt and resulting in a loss on the early retirement of debt amounting to $1,634. The Class A Notes carry an annual interest rate of 6.555% and have an amortizing maturity date of December 2034. The Class B Notes carry an annual interest rate of 11.235% and have an amortizing maturity date of September 2030. Both interest and principal payments on the ABS IX Notes are made on a monthly basis. Oaktree Seller’s Notes In June 2024, the Group partially funded the purchase price of the Oaktree transaction with deferred consideration in the form of an unsecured seller’s note from Oaktree (the “Oaktree Seller’s Note”). The Group issued $83,348 in notes at an annual interest rate of 8%, with a legal final maturity date of December 2025. Deferred interest and principal payments were scheduled in three installments: December 2024, June 2025, and December 2025. In October 2024, the Group modified the terms of the Oaktree Seller’s Note, increasing the rate to 9%, extending the maturity date to September 2026, and changing the payment schedule to monthly interest and principal payments. The Oaktree Seller’s Note contains certain customary representations and warranties, as well as affirmative and negative covenants. As of December 31, 2024, the Group was in compliance with all covenants associated with the Oaktree Seller’s Note. For additional information regarding the Oaktree transaction, refer to Note 5 . Debt Covenants ABS I, II, IV, VI, VIII and IX Notes (collectively, The “ABS Notes”) and Term Loan I and Term Loan II (collectively, the “Term Loans”) The ABS Notes and Term Loans are governed by a series of covenants and restrictions typical for such transactions, including (i) the requirement for the issuer to maintain specified reserve accounts to ensure the payment of interest on the ABS Notes and Term Loans, (ii) provisions for optional and mandatory prepayments, specified make-whole payments under certain conditions, (iii) indemnification payments in the event that the assets pledged as collateral for the ABS Notes and Term Loans are found to be defective or ineffective, (iv) covenants related to recordkeeping, access to information, and similar matters, and (v) compliance with all applicable laws and regulations, including the Employee Retirement Income Security Act (“ERISA”), environmental laws, and the USA Patriot Act (specific to ABS IV only). The ABS Notes and Term Loans are also subject to customary accelerated amortization events as outlined in the indenture. These events include failure to maintain specified debt service coverage ratios, failure to meet certain production metrics, certain change of control and management termination events, and the failure to repay or refinance the ABS Notes and Term Loans by the scheduled maturity date. Additionally, the ABS Notes and Term Loans are subject to customary events of default, which include non-payment of required interest, principal, or other amounts due, failure to comply with covenants within specified time frames, certain bankruptcy events, breaches of specified representations and warranties, failure of security interests to be effective, and certain judgments. As of December 31, 2024 the Group was in compliance with all financial covenants related to the ABS Notes and Term Loans. Sustainability-Linked Borrowings Credit Facility The Credit Facility contains three sustainability-linked performance targets (“SPTs”) that can influence the applicable margin on borrowings based on the Group’s performance. These targets are: • GHG Emissions Intensity: This target measures the Group’s consolidated Scope 1 emissions and Scope 2 emissions, expressed as MT CO2e per MMcfe; • Asset Retirement Performance: This target tracks the number of wells the Group successfully retires during any fiscal year; and • TRIR Performance: This target is based on the TRIR, calculated as the arithmetic average of the two preceding fiscal years and current period. The TRIR is computed by multiplying the total number of recordable cases (as defined by OSHA) by 200,000 and then dividing by the total hours worked by all employees during any fiscal year. The goals set by the Credit Facility for each of these categories are aspirational and represent higher thresholds than those the Group has publicly set for itself. The economic impact of meeting or failing to meet these thresholds is relatively minor, with adjustments to the applicable margin level ranging from a reduction of five basis points to an increase of five basis points in any given fiscal year. 130 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements An independent third-party assurance provider is required to certify the Group’s performance against the SPTs. ABS IV In connection with the issuance of the ABS IV Notes, the Group engaged an independent international provider of sustainability research and services to establish and maintain a “sustainability score” for the Group. If this score falls below a minimum threshold set at the time of issuance of the ABS IV Notes, the interest payable for the subsequent interest accrual period will increase by five basis points. This score is based on an overall assessment of the Group’s corporate sustainability profile and is not contingent upon the Group meeting or exceeding specific sustainability performance metrics. Additionally, the sustainability score is not influenced by the use of proceeds from the ABS IV Notes, and there are no restrictions on the use of these proceeds beyond the terms outlined in the Group’s Credit Facility. The Group provides updates to the ABS IV note holders through monthly note holder statements, informing them of any changes in the interest rate payable on the ABS IV Notes resulting from changes in the sustainability score. ABS VI & VIII A “second party opinion provider” has certified that the terms of the ABS VI and ABS VIII notes align with the International Capital Markets Association (“ICMA”) framework for sustainability-linked bonds. This framework applies to bond instruments whose financial and/or structural characteristics vary based on the achievement of predefined sustainability objectives, or SPTs. The framework comprises five key components (1) the selection of key performance indicators (“KPIs”), (2) the calibration of SPTs, (3) the variation of bond characteristics depending on whether the KPIs meet the SPTs, (4) regular reporting on the status of the KPIs and whether the SPTs have been met, and (5) independent verification of SPT performance by an external reviewer, such as an auditor or environmental consultant. Unlike the ICMA’s framework for green bonds, the framework for sustainability-linked bonds do not mandate a specific use of proceeds. The ABS VI & ABS VIII Notes contain two SPTs. The Group must achieve and have certified by May 28, 2027, for the ABS VI Notes, and by December 31, 2029, for the ABS VIII Notes, the following targets: (1) a reduction in Scope 1 and Scope 2 GHG emissions intensity to 2.85 MT CO2e/MMcfe for the ABS VI Notes and 2.73 MT CO2e/MMcfe or the ABS VIII Notes, and/or (2) a reduction in Scope 1 methane emissions intensity to 1.12 MT CO2e/MMcfe for the ABS VI Notes and 0.75 MT CO2 e/MMcfe for the ABS VIII Notes. If the Group fails to meet or have these SPTs certified by an external verifier by the respective deadlines, the interest rate payable on the ABS VI and ABS VIII notes will increase by 25 basis points for each unmet or uncertified SPT. An independent third-party assurance provider will be required to certify the Group’s performance against these SPTs by the applicable deadlines. Compliance As of December 31, 2024, the Group successfully met or was in compliance with all sustainability-linked debt metrics. Future Maturities The table below presents a reconciliation of the Group’s undiscounted future maturities of its total borrowings as of the reporting date: December 31, 2024 December 31, 2023 Not later than one year $209,463 $200,822 Later than one year and not later than five years 940,780 864,264 Later than five years 585,330 259,762 Total borrowings $1,735,573 $1,324,848 Finance Costs The table details the Group’s finance costs for each of the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Interest expense, net of capitalized and income amounts(a) $120,773 $117,808 $86,840 Amortization of discount and deferred finance costs 16,870 16,358 13,903 Other — — 56 Total finance costs $137,643 $134,166 $100,799 (a) Includes payments related to both borrowings and leases. 131 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Interest Incurred The table below represents the interest incurred related to the Group’s amortizing debt structures for each of the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Term Loan I $6,531 $7,573 8,643 ABS I Notes 4,571 5,660 $7,110 ABS II Notes 6,787 8,040 9,286 ABS III Notes 5,507 14,515 15,325 ABS IV Notes 4,440 5,703 6,235 ABS V Notes 6,792 19,332 14,319 ABS VI Notes 17,953 15,433 3,300 ABS VIII Notes 25,375 — — ABS IX Notes 1,460 — — Other miscellaneous borrowings(a) 4,106 — — Total interest incurred on amortizing debt $83,522 $76,256 $64,218 (a) Includes $3,947 and $159 of interest incurred on the Oaktree Seller’s Note and other notes payable, respectively. Fair Value The table below represents the fair value of the Group’s debt structures as of the periods presented: As of December 31, 2024 December 31, 2023 Credit Facility(a) $284,400 $159,000 Term Loan I 86,277 101,706 Term Loan II(a) 83,851 — ABS I Notes 76,821 94,517 ABS II Notes 98,273 119,519 ABS III Notes — 250,158 ABS IV Notes 74,064 92,345 ABS V Notes — 274,061 ABS VI Notes 240,150 158,284 ABS VIII Notes 593,653 — ABS IX Notes 73,897 — Other miscellaneous borrowings(a) 107,588 — Total fair value of outstanding debt $1,718,974 $1,249,590 (a) Carrying value approximates fair value. Excess Cash Flow Payments The table below represents excess cash flow payments based on the achievement of certain performance metrics related to the Group’s debt structures for each of the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 ABS I Notes $2,401 $7,892 $10,736 ABS VIII Notes 14,753 — — ABS IX Notes 884 — — Total excess cash flow payments $18,038 $7,892 $10,736 132 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Financing Activities The table below presents a r econciliation of borrowings arising from financing activities for each of the periods presented: Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Balance at beginning of period $1,276,627 $1,440,329 $1,010,355 Acquired as part of an acquisition 215,924 — 2,437 Sale of equity interest — (154,966) — Proceeds from borrowings 1,844,768 1,537,230 2,587,554 Repayments of borrowings (1,653,489) (1,547,912) (2,139,686) Costs incurred to secure financing (20,267) (13,776) (34,234) Amortization of discount and deferred financing costs 16,870 16,358 13,903 Cash paid for interest (123,141) (116,784) (83,958) Finance costs and other 135,950 116,148 83,958 Balance at end of period $1,693,242 $1,276,627 $1,440,329 Subsequent Event On February 27, 2025, the Group formed Diversified ABS Phase X LLC, a limited-purpose, bankruptcy-remote, wholly-owned subsidiary (“ABS X”), to issue asset-backed securities with a total principal amount of $530,000 at par value (“the ABS X Notes”). The Group utilized the proceeds from the ABS X Notes to refinance the ABS I Notes, ABS II Notes, and Term Loan I, and to fund the Summit transaction. Refer to Note 5 for additional information regarding acquisitions . On March 14, 2025, in connection with the close of the Maverick acquisition, the Group amended and restated the credit agreement governing its Credit Facility. The amendment extended the maturity of the Credit Facility to March 2029 and increased the borrowing base to $900,000 , primarily resulting from the additional collateral acquired from Maverick. There were no other material changes to pricing or terms. The Group utilized the proceeds from the upsized borrowing base to fund a portion of the Maverick acquisition and repay the outstanding principal on Term Loan II. Note 22 - Trade & Other Payables (Amounts in thousands, except share, per share and per unit data) The table below details the Group’s trade and other payables. The fair value approximates the carrying value as of the periods presented: December 31, 2024 December 31, 2023 Trade payables $31,896 $49,487 Other payables 3,117 4,003 Total trade and other payables $35,013 $53,490 Trade and other payables are unsecured, do not bear interest, and are settled as they become due. Note 23 - Other Liabilities (Amounts in thousands, except share, per share and per unit data) The table below details the Group’s other liabilities as of the periods presented: December 31, 2024 December 31, 2023 Other non-current liabilities Other non-current liabilities $5,384 $2,224 Total other non-current liabilities $5,384 $2,224 Other current liabilities Accrued expenses(a) $120,532 $99,723 Net revenue clearing(b) 40,935 79,056 Asset retirement obligations - current 6,436 5,402 Revenue to be distributed(c) 136,631 93,322 Total other current liabilities $304,534 $277,503 (a) As of December 31, 2024 accrued expenses increased primarily due to an $8,347 increase in accrued capital expenditures and a $6,890 increase in hedge settlement payables. As of December 31, 2023 accrued expenses decreased primarily due to a $50,541 decrease in hedge settlements payables, resulting from lower commodity prices during that year. For more detailed information on year-over-year changes in other liabilities and their fixed and variable nature, refer to the Financial Review . (b) Net revenue clearing represents the estimated revenue that is payable to third-party working interest owners. The year-over-year decrease in net revenue clearing was primarily due to the Oaktree acquisition in June 2024. 133 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements (c) Revenue to be distributed refers to revenue that is payable to third-party working interest owners but has not yet been paid due to unresolved title, legal, ownership, or other issues. The Group releases the underlying liability as these issues are resolved. Since the timing of resolution is uncertain, the Group records this balance as a current liability. The year-over-year increase in revenue to be distributed was attributed to the Group’s growth. Note 24 - Fair Value & Financial Instruments (Amounts in thousands, except share, per share and per unit data) Fair Value The fair value of an asset or liability is defined as the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction in the principal market (or most advantageous market if a principal market is not available) for that asset or liability. In estimating fair value, the Group employs valuation techniques that align with the market approach, income approach, and/or cost approach, ensuring consistent application of these techniques. The inputs to these valuation techniques include assumptions that market participants would use when pricing an asset or liability. IFRS 13, Fair Value Measurement (“IFRS 13”), establishes a fair value hierarchy for valuation inputs, prioritizing quoted prices in active markets for identical assets or liabilities as the highest level of input, and unobservable inputs as the lowest level. The fair value hierarchy is defined as follows: Level 1: Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2: Inputs (other than quoted prices included in Level 1) can include the following: (1) Observable prices in active markets for similar assets or liabilities; (2) Prices for identical assets or liabilities in markets that are not active; (3) Directly observable market inputs for substantially the full term of the asset or liability; and (4) Market inputs that are not directly observable but are derived from or corroborated by observable market data. Level 3: Unobservable inputs which reflect the Directors’ best estimates of what market participants would use in pricing the asset or liability at the measurement date. Financial Instruments Working Capital The carrying values of cash and cash equivalents, trade receivables, other current assets, accounts payable, and other current liabilities in the Consolidated Statement of Financial Position approximate their fair value due to their short-term nature. For trade receivables, the Group applies the simplified approach permitted by IFRS 9, Financial Instruments (“IFRS 9”), which requires the recognition of expected lifetime losses from the initial recognition of the receivables. Financial liabilities are initially measured at fair value and subsequently measured at amortized cost. For borrowings, derivative financial instruments, and leases, the following methods and assumptions were used to estimate fair value: Borrowings The fair values of the Group’s ABS Notes and Term Loans are considered to be Level 2 measurements within the fair value hierarchy. The carrying values of the borrowings under the Group’s Credit Facility (to the extent utilized) and Term Loan II approximate fair value because the interest rate is variable and reflective of market rates. The Group also considers the fair value of its Credit Facility to be a Level 2 measurement within the fair value hierarchy. Leases The Group initially measures the lease liability at the present value of the future lease payments. These lease payments are discounted using the interest rate implicit in the lease. If this rate cannot be readily determined, the Group uses its incremental borrowing rate to discount the lease payments. Derivative Financial Instruments The Group measures the fair value of its derivative financial instruments using a pricing model that incorporates market-based inputs. These inputs include, but are not limited to, the contractual price of the underlying position, current market prices, natural gas and liquids forward curves, discount rates such as the U.S. Treasury yields, the SOFR curve, and volatility factors. The Group classifies its derivative financial instruments into the fair value hierarchy based on the data used to determine their fair values. The Group’s fixed price swaps (Level 2) are estimated using third-party discounted cash flow calculations, utilizing the NYMEX futures index for natural gas and oil derivatives, and OPIS for NGLs derivatives. For valuing its interest rate derivatives (Level 2), the Group employs discounted cash flow models. The net derivative values attributable to the Group’s interest rate derivative contracts as of December 31, 2024 are based on (i) the contracted notional amounts, (ii) active market-quoted SOFR yield curves, and (iii) the applicable credit-adjusted risk-free rate yield curve. The Group’s call options, put options, collars and swaptions (Level 2) are valued using the Black-Scholes model, an industry-standard option valuation model. This model takes into account inputs such as contract terms, including maturity, and market parameters, including assumptions of NYMEX and OPIS futures, interest rates, volatility and creditworthiness. Inputs to the Black-Scholes model, including the volatility input, are obtained from a third- party pricing source, with independent verification of the most significant inputs on a monthly basis. A change in volatility would result in a corresponding change in fair value measurement. The Group’s basis swaps (Level 2) are estimated using third-party calculations based on forward commodity price curves. There were no transfers between fair value levels for the year ended December 31, 2024. 134 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements The following table includes the Group's financial instruments as of the periods presented: December 31, 2024 December 31, 2023 Cash and cash equivalents $5,990 $3,753 Trade receivables, net 234,421 190,207 Other non-current assets 6,270 9,172 Other non-current liabilities(a) (5,384) (1,946) Other current liabilities(b) (298,098) (272,101) Derivative financial instruments at fair value (710,347) (557,460) Leases (44,600) (31,122) Borrowings (1,718,974) (1,249,590) Total $(2,530,722) $(1,909,087) (a) Excludes $278 for the long-term portion of the value associated with the upfront promote received from Oaktree for the year ended December 31, 2023. (b) Includes accrued expenses, net revenue clearing, and revenue to be distributed. Excludes asset retirement obligations. Note 25 - Financial Risk Management (Amounts in thousands, except share, per share and per unit data) The Group is exposed to various financial risks, including market risk, credit risk, liquidity risk, capital risk, and collateral risk. To manage these risks, the Group continuously monitors the unpredictability of financial markets and seeks to minimize potential adverse effects on its financial performance. The Group’s principal financial liabilities consist of borrowings, leases, and trade and other payables, which are primarily used to finance and provide financial guarantees for its operations. The Group’s principal financial assets include cash and cash equivalents, as well as trade and other receivables derived from its operations. Additionally, the Group also enters into derivative financial instruments, which are recorded as assets or liabilities depending on market dynamics. The Group leverages its internal resources to design and manage its derivative-related risk management activities, but also engages with third party providers to assist with the execution of derivative transactions and provide commodity trading and risk management applications. Market Risk Market risk refers to the possibility that the fair value of future cash flows of a financial instrument will fluctuate due to changes in market prices. Market risk is comprised of two main types of risk: interest rate risk and commodity price risk. Financial instruments affected by market risk include borrowings and derivative financial instruments. To manage market price risks resulting from changes in commodity prices and foreign exchange rates, the Group uses both derivative and non- derivative financial instruments. These instruments help mitigate the potential negative effects on the Group’s assets, liabilities, or future expected cash flows. Interest Rate Risk The Group is subject to market risk exposure related to changes in interest rates. The Group’s borrowings primarily consist of fixed-rate amortizing notes and its variable rate Credit Facility and Term Loan II, as illustrated below. December 31, 2024 December 31, 2023 Borrowings Interest Rate(a) Borrowings Interest Rate(a) ABS Notes, Term Loan I, & other(b) $1,443,013 7.01% $1,158,221 5.67% Credit Facility & Term Loan II $368,251 8.68% $159,000 8.66% (a) The interest rate on the ABS Notes, Term Loan I and other notes payable represents the weighted average fixed rate of the notes, while the interest rate presented for the Credit Facility and Term Loan II represents the floating rate as of December 31, 2024 and 2023 , respectively. (b) Includes $76,100 in notes payable issued as part of the consideration in the Oaktree transaction, and $30,000 in notes payable issued by a third party financial institution in November 2024 collateralized by two natural gas processing plants and various natural gas compressors and related support equipment in the Central Region, as of December 31, 2024. Refer to Note 5 for additional information regarding the Oaktree transaction. For additional information regarding the ABS Notes, Term Loan I, Term Loan II, and Credit Facility, refer to Note 21. The table below illustrates the impact of a 100 basis point adjustment in the borrowing rate for the Credit Facility and Term Loan II and the corresponding effect on finance costs. This represents a reasonably possible change in interest rate risk. Credit Facility & Term Loan II Interest Rate Sensitivity December 31, 2024 December 31, 2023 +100 Basis Points $3,683 $1,590 -100 Basis Points $(3,683) $(1,590) The Group strives to maintain a prudent balance of floating and fixed-rate borrowing exposure, particularly during uncertain market conditions. As part of the Group’s risk mitigation strategy, the Group occasionally enters into swap arrangements to adjust its exposure to floating or fixed interest rates, depending on changes in the composition of borrowings in its portfolio. Consequently, the total principal hedged through the use of derivative financial instruments varies from period to period. 135 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements As of December 31, 2024 and 2023, the fair value of the Group’s interest rate swaps represents an asset of $235 and an asset of $315, respectively. For additional information regarding derivative financial instruments, refer to Note 13 . Commodity Price Risk The Group’s revenues are primarily derived from the sale of its natural gas, NGLs, and oil production, making the Group subject to commodity price risk. Commodity prices for natural gas, NGLs and oil can be volatile and may fluctuate due to relatively small changes in supply, weather conditions, economic conditions, and government actions. For the years ended December 31, 2024 , 2023 and 2022, the Group’s commodity revenue was $732,259 , $802,399, and $1,873,011, respectively. To mitigate the risk of fluctuations in commodity prices, the Group enters into derivative financial instruments. The total volumes hedged through the use of these instruments vary from period to period. Generally the Group’s objective is to hedge at least 65% of its anticipated production volumes for the next 12 months, at least 50% for months 13 to 24, and a minimum of 30% for months 25 to 36. For additional information regarding derivative financial instruments, refer to Note 13. By removing price volatility from a significant portion of the Group’s expected production through 2032, the Group has mitigated, but not eliminated, the potential effects of changing prices on its operating cash flow for those periods. While these derivative contracts help mitigate the negative effects of falling commodity prices, they also limit the benefits the Group would receive from increases in commodity prices. Credit and Counterparty Risk The Group is exposed to credit and counterparty risk from the sale of its natural gas, NGLs and oil. Trade receivables from customers represent amounts due for the purchase of these commodities, and their collectability depends on the financial condition of each customer. The Group reviews the financial condition of customers before extending credit and generally does not require collateral to support their trade receivables. As of December 31, 2024 and 2023, the Group had no customers that comprised over 10% of its total trade receivables. The Group’s trade receivables from customers, net of the applicable allowance for credit losses, were $199,788 and $168,913 , respectively, as of December 31, 2024 and 2023. The Group is also exposed to credit risk from joint interest owners, which are entities that own a working interest in the properties operated by the Group. Joint interest receivables are classified under trade receivables, net, in the Consolidated Statement of Financial Position. The Group has the ability to withhold future revenue payments to recover any non-payment of joint interest receivables. As of December 31, 2024 and 2023 , the Group’s joint interest receivables, net of the applicable allowance for credit losses, were $34,633 and $21,294 , respectively. Trade receivables are current, and the Group believes these net receivables are collectible. For additional information, refer to Note 3. Liquidity Risk Liquidity risk is the possibility that the Group will not be able to meet its financial obligations as they fall due. The Group manages this risk by maintaining adequate cash reserves through the use of cash from operations and borrowing capacity on the Credit Facility. Additionally, the Group continuously monitors its forecast and actual cash flows to ensure it maintains an appropriate level of liquidity. The amounts disclosed in the following table represent the Group’s contractual undiscounted cash flows. Not Later Than One Year Later Than One Year and Not Later Than Five Years Later Than Five Years Total For the year ended December 31, 2024 Trade and other payables $35,013 $— $— $35,013 Borrowings 209,463 940,780 585,330 1,735,573 Leases 16,080 33,215 139 49,434 Other liabilities(a) 161,467 5,384 — 166,851 Total $422,023 $979,379 $585,469 $1,986,871 For the year ended December 31, 2023 Trade and other payables $53,490 $— $— $53,490 Borrowings 200,822 864,264 259,762 1,324,848 Leases 12,358 22,531 — 34,889 Other liabilities(a) 178,779 2,224 — 181,003 Total $445,449 $889,019 $259,762 $1,594,230 (a) Includes accrued expenses and net revenue clearing. Excludes asset retirement obligations and revenue to be distributed. Capital Risk The Group defines capital as the total of equity shareholders’ funds and long-term borrowings net of available cash balances. The Group’s objectives when managing capital are to provide returns for shareholders, maintain appropriate leverage and safeguard the ability to continue as a going concern. Additionally, the Group aims to pursue opportunities for growth by identifying and evaluating potential acquisitions and constructing new infrastructure on existing proved leaseholds. The Directors do not establish a quantitative return on capital criteria, but instead promote year-over-year adjusted EBITDA growth. The Group actively manages its balance sheet and seeks to maintain a long-term leverage ratio approximately 2.5x. 136 Table of Contents Diversified Energy Company PLC 2024 Annual Report Group Financial Statements Collateral Risk As of December 31, 2024 , the Group has pledged 100% of its upstream natural gas and oil properties in the Appalachian and Central regions, along with certain midstream assets, to fulfill the collateral requirements for borrowings under its debt instruments. The fair value of the collateral is based on an independent petroleum engineering firm’s reserves calculation, which uses estimated cash flows discounted at 10% and a commodities futures price schedule. For additional information regarding acquisitions and borrowings, refer to Notes 5 and 21 , respectively. Note 26 - Commitments & Contingencies (Amounts in thousands, except share, per share and per unit data) Delivery Commitments We have contractually agreed to deliver firm quantities of natural gas to various customers, which we expect to fulfill with production from existing reserves. To ensure we meet these commitments, we regularly monitor our proved developed reserves. The following table summarizes our total gross commitments, compiled using best estimates based on our sales strategy, as of December 31, 2024. Natural gas (MMcf) 2025 77,187 2026 52,802 2027 130,911 Thereafter 242,276 Litigation and Regulatory Proceedings The Group is involved in various pending legal issues that have arisen in the ordinary course of business. The Group accrues for litigation, claims, and proceedings when a liability is both probable and the amount can be reasonably estimated. As of December 31, 2024 and 2023, the Group did not have any material amounts accrued related to litigation or regulatory matters. For any matters not accrued for, it is not possible to estimate the amount of any additional loss or range of loss that is reasonably possible. However, based on the nature of the claims, management believes that current litigation, claims, and proceedings are not, individually or in aggregate, after considering insurance coverage and indemnification, likely to have a material adverse impact on the Group’s financial position, results of operations, or cash flows. The Group has no other contingent liabilities that would have a material impact on the Group’s financial position, results of operations, or cash flows. Environmental Matters The Group’s operations are subject to environmental laws and regulations in all the jurisdictions where it operates, and it was in compliance as of December 31, 2024 and 2023 . However, the Group is unable to predict the impact of additional environmental laws and regulations that may be adopted in the future, including whether they would adversely affect its operations. The Group can offer no assurance regarding the significance or cost of compliance associated with any new environmental legislation or regulation once implemented. Note 27 - Related Party Transactions (Amounts in thousands, except share, per share and per unit data) The Group had no related party activity in 2024 , 2023 or 2022. Note 28 - Subsequent Events (Amounts in thousands, except share, per share and per unit data) The Group determined the need to disclose the following material transactions that occurred subsequent to December 31, 2024, which have been described within each relevant footnote as follows: Description Footnote Acquisitions & Divestitures Note 5 Share Capital Note 16 Dividends Note 18 Borrowings Note 21 137 Table of Contents Diversified Energy Company PLC 2024 Annual Report Company Financial Statements Company Financial Statements Page Company Financial Statements 137 Company Statement of Financial Position 137 Company Statement of Changes in Equity 138 Notes to the Company Financial Statements 139 Note 1 - General Information 139 Note 2 - Accounting Policies 139 Note 3 - Significant Accounting Judgments and Estimates 139 Note 4 - Investments 140 Note 5 - Share Capital 140 Note 6 - Dividends 141 Note 7 - Operating Expenses 141 Note 8 - Taxation 141 Company Statement of Financial Position (Amounts in thousands, except share, per share and per unit data) Note December 31, 2024 December 31, 2023 ASSETS Non-current assets: Investments in subsidiaries 4 £1,077,222 £1,055,908 Other non-current assets 138 102 Total non-current assets 1,077,360 1,056,010 Current assets: Cash and cash equivalents 17 562 Other current assets — 109 Total current assets 17 671 Total assets £1,077,377 £1,056,681 EQUITY AND LIABILITIES Shareholders' equity: Share capital 5 £10,254 £9,586 Share premium 5 973,407 931,102 Treasury reserve (95,656) (82,877) Share based payment and other reserves 15,795 11,346 Retained earnings (accumulated deficit) 171,487 183,009 Equity attributable to owners of the Parent 1,075,287 1,052,166 Total equity 1,075,287 1,052,166 Current liabilities: Trade and other payables 2,090 4,515 Total current liabilities 2,090 4,515 Total liabilities 2,090 4,515 TOTAL EQUITY & LIABILITIES £1,077,377 £1,056,681 The profit for the 2024 financial year of the Company was £56,864 ( 2023: £93,725 ). The notes on pages 139 to 141 are an integral part of the Company Financial Statements . The Company Financial Statements were approved by the Board of Directors and authorized for issuance on March 17, 2025 and were signed on its behalf by: David E. Johnson Chairman of the Board Registered in England and Wales, No. 9156132 138 Table of Contents Diversified Energy Company PLC 2024 Annual Report Company Financial Statements Company Statement of Changes in Equity (Amounts in thousands, except share, per share and per unit data) Note Share Capital Share Premium Treasury Reserve Share- Based Payment and Other Reserves Retained Earnings (Accumulated Deficit) Total Equity Balance as of January 1, 2022 £8,492 £802,889 £(54,017) £11,320 £127,215 £895,899 Income after taxation — — — — 217,698 217,698 Other comprehensive income (loss) — — — — — — Total comprehensive income (loss) £— £— £— £— £217,698 £217,698 Issuance of share capital (settlement of warrants) 5 4 — — 353 — 357 Issuance of share capital (equity compensation) 5 6 — — 4,713 (2,704) 2,015 Issuance of EBT shares (equity compensation) 5 — — 2,007 (2,007) — — Repurchase of shares (EBT) 5 — — (19,388) — — (19,388) Repurchase of shares (share buyback program) 5 (71) — (10,371) 71 — (10,371) Dividends 6 — — — — (116,285) (116,285) Cancellation of warrants — — — (242) — (242) Transactions with shareholders £(61) £— £(27,752) £2,888 £(118,989) £(143,914) Balance as of December 31, 2022 £8,431 £802,889 £(81,769) £14,208 £225,924 £969,683 Income after taxation — — — — 93,725 93,725 Other comprehensive income (loss) — — — — — — Total comprehensive income (loss) £— £— £— £— £93,725 £93,725 Issuance of share capital (equity placement) 5 1,284 128,213 — — — 129,497 Issuance of share capital (equity compensation) 5 — — — 4,739 (2,407) 2,332 Issuance of EBT shares (equity compensation) — — 7,730 (7,730) — — Repurchase of shares (share buyback program) 5 (129) — (8,838) 129 — (8,838) Dividends 6 — — — — (134,233) (134,233) Transactions with shareholders £1,155 £128,213 £(1,108) £(2,862) £(136,640) £(11,242) Balance as of December 31, 2023 £9,586 £931,102 £(82,877) £11,346 £183,009 £1,052,166 Income after taxation — — — — 56,864 56,864 Other comprehensive income (loss) — — — — — — Total comprehensive income (loss) £— £— £— £— £56,864 £56,864 Issuance of share capital (acquisition consideration) 5 918 42,305 — — — 43,223 Issuance of share capital (equity compensation) — — — 7,809 (2,948) 4,861 Issuance of EBT shares (equity compensation) 5 — — 3,610 (3,610) — — Repurchase of shares (EBT) 5 — — (4,065) — — (4,065) Repurchase of shares (share buyback program) 5 (250) — (12,324) 250 — (12,324) Dividends 6 — — — — (65,438) (65,438) Transactions with shareholders £668 £42,305 £(12,779) £4,449 £(68,386) £(33,743) Balance as of December 31, 2024 £10,254 £973,407 £(95,656) £15,795 £171,487 £1,075,287 The notes on pages 139 to 141 are an integral part of the Company Financial Statements. 139 Table of Contents Diversified Energy Company PLC 2024 Annual Report Company Financial Statements Notes to the Company Financial Statements (Amounts in thousands, except share, per share and per unit data) Note 1 - General Information (Amounts in thousands, except share, per share and per unit data) Diversified Energy Company PLC (the “Parent” or “Company”), and its wholly owned subsidiaries (the “Group”) is an independent energy company engaged in the production, transportation and marketing of primarily natural gas related to its synergistic U.S. onshore upstream and midstream assets. The Group’s assets are located within the Appalachian Region and Central Region in the U.S. The Company was incorporated on July 31, 2014 in the United Kingdom and is registered in England and Wales under the Companies Act 2006 as a public limited company under company number 09156132. The Group‘s registered office is located at 4th floor Phoenix House, 1 Station Hill, Reading, Berkshire, RG1 1NB, UK. In May 2020, the Company’s shares were admitted to trading on the LSE’s Main Market for listed securities under the ticker “DEC”. In December 2023, the Company’s shares were admitted to trading on NYSE under the ticker “DEC.” As of December 31, 2024, the principal trading market for the Company’s ordinary shares was the LSE. Note 2 - Accounting Policies (Amounts in thousands, except share, per share and per unit data) Basis of Preparation The Company Financial Statements have been prepared in accordance with Financial Reporting Standard 102 “FRS 102” and the Companies Act 2006 under the historical cost basis. The preparation of Company Financial Statements in compliance with FRS 102 requires the use of certain critical accounting estimates. It also requires the Directors to exercise judgment in applying the Company's accounting policies (refer to Note 3 ). The Company Financial Statements are presented in British pound sterling (“£”) and rounded to the nearest thousand, unless otherwise stated. The Company has taken advantage of the following disclosure exemptions: • As permitted by Section 408 of the Companies Act 2006 the Company has not included a Profit and Loss account in the Company Financial Statements. • As permitted by The Financial Reporting Standard applicable in the UK and Republic of Ireland (“FRS”) 102 Section 7 “Statement of Cash Flows” and Section 11 “Financial Instruments” the company has not included a Statement of Cash Flows as well as other limited disclosures. • As permitted by FRS 102 Section 33 “Related Party Disclosures” the financial statements do not disclose transactions with any wholly owned subsidiary undertakings. There were no other related party transactions to report Going Concern The Company Financial Statements have been prepared on the going concern basis, which contemplates the health of the Company, as well as the continuity of normal business activity and the realization of assets and the settlement of liabilities in the normal course of business. The Directors have reviewed the Company's overall position and outlook and are of the opinion that it is sufficiently well funded to be able to operate as a going concern for at least the next twelve months from the date of approval of the Company Financial Statements . Refer to Note 2 to the Group Financial Statements for additional information. New or Amended Accounting Standards - Not Yet Adopted At the date of authorization of the Company Financial Statements, the following standard, which has not been applied in the Company Financial Statements, was in issue but not yet effective. It is expected that where applicable, this standard will be adopted on the effective date. The Group is still assessing the effect of this standard, though it is not expected to have a material impact. Standard Amendment Effective Date FRS 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland Annual periods beginning on or after January 1, 2026 Significant Accounting Policies Cash & Cash Equivalents Cash is represented by cash in hand and deposits with financial institutions repayable without penalty on notice of not more than 24 hours. Cash equivalents are highly liquid investments that mature in no more than three months from the date of acquisition and that are readily convertible to known amounts of cash with insignificant risk of change in value. Investments Investments in subsidiaries represents contributions of capital to subsidiaries and are held at cost less accumulated impairment losses. Share-Based Payments The Company accounts for share-based payments under FRS 102. All of the Company's share-based awards are equity settled. The fair value of the awards are determined at the date of grant. As of December 31, 2024 , 2023 and 2022, the Company had three types of share-based payment awards, RSUs, PSUs and Options. The fair value of the Company’s RSUs is measured using the stock price at the grant date. The fair value of the Company's PSUs is measured using a Monte Carlo simulation model as of the grant date. The fair value of the Company's Options are calculated using the Black- Scholes model as of the grant date. The fair value of each award is expensed uniformly over the vesting period. Note 3 - Significant Accounting Judgments & Estimates (Amounts in thousands, except share, per share and per unit data) In preparing the Company Financial Statements, the Directors considered that the key judgment is the evaluation of the carrying value of the investments in subsidiaries for impairment. Investments in subsidiaries were £1,077,222 and £1,055,908 as of December 31, 2024 and 2023, respectively. When considering indicators for impairment of the Company's investments the Directors evaluate the impairment indicators for the Group’s 140 Table of Contents Diversified Energy Company PLC 2024 Annual Report Company Financial Statements financial statements on the basis that the Group’s subsidiaries hold the natural gas and oil properties which generate the Group’s cash flows. These cash flows are ultimately linked to the subsidiaries’ ability to pay dividends back to the Company. At each reporting date, the Directors assess whether indications exist that an asset may be impaired. If indications do exist, or when annual impairment testing for an asset is required, the Directors estimate the asset’s recoverable amount. The Directors undertook an impairment trigger assessment in line with their accounting policy. As a result of this evaluation, the Directors determined that the sustained decline in the Group’s market capitalization represented an impairment trigger for the year ended December 31, 2024 . Accordingly, the Directors performed an assessment of the recoverable amount of the investment in subsidiaries. As a result of this assessment, the Directors determined that the investment was fully recoverable and no impairment was recognized. The Directors also assessed the sensitivity of the impairment analysis and noted that no reasonable change in assumptions would cause an impairment. For the year ended December 31, 2023, the Group determined that the carrying amounts of certain proved properties for two fields were not recoverable from future cash flows and recognized an impairment charge of $41,616. No such impairment was recorded during the year ended December 31, 2022. Refer to Note 5 to the Group Financial Statements. In evaluating the outcome of this assessment, the Directors also reviewed the borrowing obligations of the subsidiaries and their capacity to generate cash flows that contribute to distributable reserves. Following this review, it was determined that the carrying value of natural gas and oil properties did not require impairment in any fields. Additionally, there were no signs that the subsidiaries would be unable to meet their obligations. Note 4 - Investments (Amounts in thousands, except per share and per unit data) The Company fully owns the issued share capital of Diversified Gas & Oil Corporation, which is incorporated in Delaware, U.S. As of December 31, 2024 and 2023, the carrying value as of the investments held was £1,077,222 and £1,055,908 , respectively. The year-over-year increase was primarily due to additional capital contributions to subsidiaries, resulting from the issuance and repurchase of share capital as well as dividend payments. A detailed list of the Company’s subsidiaries can be found in Note 2 of the Group Financial Statements. The registered office for Diversified Gas & Oil Corporation, along with all its subsidiaries, is located at 1600 Corporate Drive, Birmingham, Alabama, U.S. Note 5 - Share Capital (Amounts in thousands, except per share and per unit data) The table below provides a summary of the Company's share capital for the periods presented. For more detailed information on share capital and other reserves, refer to Notes 16 and 17 in the Group Financial Statements. Number of Shares Total Share Capital Total Share Premium Balance as of December 31, 2021 42,482,733 £8,492 £802,889 Issuance of share capital (settlement of warrants) 25,695 4 — Issuance of share capital (equity compensation) 39,629 6 — Issuance of EBT shares (equity compensation) 87,998 — — Repurchase of shares (EBT) (789,513) — — Repurchase of shares (share buyback program) (399,769) (71) — Balance as of December 31, 2022 41,446,773 £8,431 £802,889 Issuance of share capital (equity placement) 6,422,200 1,284 128,213 Issuance of EBT shares (equity compensation) 334,251 — — Repurchase of shares (share buyback program) (646,762) (129) — Balance as of December 31, 2023 47,556,462 £9,586 £931,102 Issuance of share capital (acquisition consideration) 4,592,095 918 42,305 Issuance of EBT shares (equity compensation) 139,317 — — Repurchase of shares (EBT) (418,151) — — Repurchase of shares (share buyback program) (1,219,879) (250) — Balance as of December 31, 2024 50,649,844 10,254 £973,407 Shares acquired and issued by the EBT do not impact share capital or share premium. For further details on the accounting treatment of EBT shares, refer to Note 16 in the Group Financial Statements. 141 Table of Contents Diversified Energy Company PLC 2024 Annual Report Company Financial Statements Note 6 - Dividends (Amounts in thousands, except per share and per unit data) The table below summarizes the Company's dividends that were paid and declared on the specified dates. Date Dividends Declared/Paid Dividend per Share (GBP) Record Date Pay Date Shares Outstanding Gross Dividends Paid November 15, 2023 £0.6844 March 1, 2024 March 28, 2024 47,221,488 £32,318 April 10, 2024 0.2283 May 24, 2024 June 28, 2024 47,062,984 10,744 May 9, 2024 0.2211 August 30, 2024 September 27, 2024 49,005,036 10,835 August 15, 2024 0.2279 November 29, 2024 December 27, 2024 50,642,261 11,541 Paid during the year ended December 31, 2024 £65,438 November 14, 2022 £0.7220 March 3, 2023 March 28, 2023 47,868,969 £34,601 March 21, 2023 0.6860 May 26, 2023 June 30, 2023 48,164,650 32,998 May 9, 2023 0.7040 September 1, 2023 September 29, 2023 48,157,129 33,893 September 1, 2023 0.6840 December 1, 2023 December 29, 2023 47,856,570 32,741 Paid during the year ended December 31, 2023 £134,233 October 28, 2021 £0.6500 March 4, 2022 March 28, 2022 42,502,328 £27,585 March 22, 2022 0.6860 May 27, 2022 June 30, 2022 42,527,424 29,143 May 16, 2022 0.7320 September 2, 2022 September 26, 2022 42,294,025 30,968 August 8, 2022 0.6900 November 25, 2022 December 28, 2022 41,446,769 28,589 Paid during the year ended December 31, 2022 £116,285 Dividends were proposed prior to the approval of the financial statements. For further details, refer to Note 18 in the Group Financial Statements . Note 7 - Operating Expenses (Amounts in thousands, except per share and per unit data) Information regarding Directors’ remuneration can be found in Remuneration at a Glance within this Annual Report. Details on Auditors’ remuneration are provided in Note 7 of the Group Financial Statements. Note 8 - Taxation (Amounts in thousands, except per share and per unit data) The tax assessed for the year aligns with the UK corporate tax rate, which was 25% for the year ended December 31, 2024, 23.0% for the year ending December 31, 2023, and 19% for the year ending December 31, 2022. Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Profit on ordinary activities before tax £57,014 £93,619 £217,825 Standard UK corporate tax on profits for the period 14,254 22,000 41,387 Non-taxable income (15,903) (23,331) (42,569) Permanent differences 1,618 1,229 1,264 Other 171 — 45 Total tax charge for the year £140 £(102) £127 Non-taxable income for the years ended December 31, 2024, 2023 and 2022 pertained to dividend income received from U.S. subsidiaries, amounting to £63,610, £99,283 and £224,047, respectively. The UK corporation tax rate increased from 19% to 23% effective April 1, 2023. This change did not have a material impact on the Company’s financial statements. Note 9 - Subsequent Events Refer to Note 28 in the Group Financial Statements for additional information regarding subsequent events. 142 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Additional Information (Unaudited) Page Payments to Governments Report 2024 142 Alternative Performance Measures 144 Officers and Professional Advisors 147 Glossary of Terms 148 Payments to Governments Report 2024 (Amounts in thousands) This report provides a consolidated overview of the payments made to governments by DEC for the year 2024 as required under Disclosure and Transparency Rule 4.3A issued by the UK's Financial Conduct Authority ("DTR 4.3A") and in accordance with The Reports on Payments to Governments Regulations 2014 (as amended in 2015) ("the UK Regulations"). DTR 4.3A mandates that companies listed on a UK stock exchange and operating in the extractive industry publicly disclose payments to governments in the countries where they engage in the exploration, prospection, discovery, development, and extraction of natural gas and oil deposits, or other materials. Basis of Preparation In accordance with the UK Regulations, DEC prepares a disclosure of payments made to governments for each financial year, covering relevant activities of both DEC and any of its subsidiary undertakings included in the Group Financial Statements. Activities within the Scope of the Disclosure This disclosure includes payments made to governments that pertain to DEC’s activities involving the exploration, development, and production of natural gas and oil reserves (“extractive activities”). Payments made to governments for activities other than extractive activities are not included in this disclosure as they fall outside the scope defined by the UK Regulations. Government The term “government” encompasses any national, regional, or local authority of a country as well as any department, agency, or entity that operates as a subsidiary of a government. Cash Basis Payments are reported on a cash basis, meaning they are reported in the period in which they are actually paid. This is in contrast to the accrual basis, where payments are reported in the period in which the liabilities are incurred. Project Definition The UK Regulations mandate that payments be reported by project, which is considered a subcategory within a country. A “project” is defined as the operational activities governed by a single contract, license, lease, concession, or similar legal agreement that form the basis for payment liabilities with a government. If these agreements are substantially interconnected, they can be treated as a single project. According to the UK Regulations, “substantially interconnected” refers to a set of operationally and geographically integrated contracts, licenses, leases, concessions, or related agreements with substantially similar terms, signed with a government, that give rise to payment liabilities. The number of projects will depend on the contractual arrangements within a country, rather than the scale of activities. Additionally, a project will only be included in this disclosure if relevant payments were made during the year for that project. The UK Regulations also recognize that some payments may not be attributable to a single project and may therefore be reported at the country level. Corporate income taxes, which are typically not levied at a project level, serve as an example of such payments. Materiality Level For each type of payment, any total payments to a government that are below £86 are excluded from this report. Exchange Rate Payments made in currencies other than USD are converted for this report using the relevant quarterly average foreign exchange rate. Payment Types According to the UK Regulations, a “payment” is defined as an amount paid whether in money or in kind, for relevant activities. The payment must fall into one of the following categories: Production Entitlements Under production-sharing agreements (“PSA”), the production is divided between the host government and the other parties to the PSA. The host government usually receives its share or entitlement in kind rather than in cash. For the year ended December 31, 2024, DEC had no reportable production entitlements to a government. Taxes This report includes taxes levied on income, personnel, production, or profits that are withheld from dividends, royalties, and interest received by DEC. However, taxes levied on consumption, sales, procurement (contractor’s withholding taxes), environmental, property, customs, and excise are not reportable under the UK Regulations. Royalties Payments for the rights to extract natural gas and oil resources are typically calculated as a set percentage of revenue, minus any allowable deductions. These payments can be made in cash or in kind (valued similarly to production entitlement). Dividends Dividend payments, except for those paid to a government as a shareholder of an entity, are not included unless they are paid in lieu of production entitlements or royalties. For the year ended December 31, 2024, DEC had no reportable dividend payments to a government. 143 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Bonuses This report includes signature, discovery, and production bonuses, as well as other bonuses payable under licenses or concession agreements. These bonuses are typically paid upon signing an agreement or a contract, declaring a commercial discovery, commencing production, or reaching a production milestone. For the year ended December 31, 2024, DEC had no reportable bonus payments to a government. Fees In preparing this report, DEC has included license fees, rental fees, entry fees, and all other payments made in consideration for new and existing licenses and or concessions. Fees paid to governments for administrative services are excluded. Infrastructure Improvements Payments related to the construction of infrastructure, such as roads, bridges, or railways, that are not substantially dedicated to extractive activities are included. However, payments that are of a social investment nature, such as building a school or hospital, are excluded. Payments Overview The tables below display the relevant payments to governments made by DEC for the year ended December 31, 2024, categorized by country and payment type. Of the seven payment types required by the UK Regulations, DEC did not make any payments for production entitlements, dividends, bonuses, fees, or infrastructure improvements; therefore, those categories are not shown. SUMMARY OF PAYMENTS TO GOVERNMENTS (Amounts in Thousands) Countries Taxes Royalties Total United Kingdom $— $— $— United States 86,049 2,735 88,784 Total $86,049 $2,735 $88,784 United Kingdom Governments Taxes Royalties Total Oil and Gas Authority $— $— $— HM Revenue and Customs — — — The Crown Estate Scotland — — — Total $— $— $— United States Governments Taxes Royalties Total Commonwealth of Pennsylvania $3,977 $— $3,977 Commonwealth of Virginia 1,661 — 1,661 Internal Revenue Service 18,799 — 18,799 Office of Natural Resources Revenue — 1,427 1,427 State of Alabama 114 — 114 State of Kentucky 10,585 — 10,585 State of Louisiana 8,520 — 8,520 State of Ohio 2,168 — 2,168 State of Oklahoma 8,906 1,089 9,995 State of Tennessee 185 — 185 State of Texas 17,920 219 18,139 State of West Virginia 13,214 — 13,214 Total $86,049 $2,735 $88,784 144 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Alternative Performance Measures (Amounts in thousands, except share, per share and per unit data) We utilize APMs to enhance the comparability of information across reporting periods and to more accurately assess cash flows. This is achieved by adjusting for uncontrollable or transactional factors that are not comparable period-over-period or by aggregating measures. This approach helps users of this Annual Report better understand the activity occurring across the Group. APMs are employed by the Directors for planning and reporting purposes and should not be viewed as a replacement for IFRS. Additionally, these measures are used in discussions with the investment analyst community and credit rating agencies. Adjusted EBITDA As used herein, EBITDA represents earnings before interest, taxes, depletion, depreciation, and amortization. Adjusted EBITDA further adjusts for items that are not comparable period-over-period, including accretion of asset retirement obligations, other (income) expense, loss on joint and working interest owners receivable, (gain) loss on bargain purchases, (gain) loss on fair value adjustments of unsettled financial instruments, (gain) loss on natural gas and oil property and equipment, costs associated with acquisitions, other adjusting costs, non-cash equity compensation, (gain) loss on foreign currency hedge, net (gain) loss on interest rate swaps and other similar items. Adjusted EBITDA should not be considered in isolation or as a substitute for operating profit (loss), net income (loss), or cash flows provided by (used in) operating, investing, and financing activities. However, we believe this measure is useful to investors in evaluating our financial performance because it (1) is widely used by investors in the natural gas and oil industry as an indicator of underlying business performance; (2) helps investors more meaningfully evaluate and compare the results of our operations from period to period by removing the often-volatile revenue impact of changes in the fair value of derivative instruments prior to settlement; (3) is used in the calculation of a key metric in one of our Credit Facility financial covenants; and (4) is used by us as a performance measure in determining executive compensation. When evaluating this measure, we believe investors also commonly find it useful to assess this metric as a percentage of our total revenue, inclusive of settled hedges, which we refer to as adjusted EBITDA margin. Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Net income (loss) $(87,001) $759,701 $(620,598) Finance costs 137,643 134,166 100,799 Accretion of asset retirement obligations 30,868 26,926 27,569 Other (income) expense(a) (1,257) (385) (269) Income tax (benefit) expense (136,951) 240,643 (178,904) Depreciation, depletion and amortization 256,484 224,546 222,257 (Gain) loss on bargain purchases — — (4,447) (Gain) loss on fair value adjustments of unsettled financial instruments 189,030 (905,695) 861,457 (Gain) loss on natural gas and oil properties and equipment(b) 15,308 4,014 93 (Gain) loss on sale of equity interest 7,375 (18,440) — Unrealized (gain) loss on investment 4,013 (4,610) — Impairment of proved properties(c) — 41,616 — Costs associated with acquisitions 11,573 16,775 15,545 Other adjusting costs(d) 22,375 17,794 69,967 Loss on early retirement of debt 14,753 — — Non-cash equity compensation 8,286 6,494 8,051 (Gain) loss on foreign currency hedge — 521 — (Gain) loss on interest rate swap (190) 2,722 1,434 Total adjustments $559,310 $(212,913) $1,123,552 Adjusted EBITDA $472,309 $546,788 $502,954 Pro forma adjusted EBITDA(e) $548,570 $553,252 $574,414 (a) Excludes $1 million in dividend distributions received for our investment in DP Lion Equity Holdco during the year ended December 31, 2024. (b) Excludes $27 million , $24 million and $2 million in cash proceeds received for leasehold sales during the years ended December 31, 2024, 2023 and 2022, respectively, less $14 million and $4 million of basis in leasehold sales for the years ended December 31, 2024 and 2023, respectively. (c) For the year ended December 31, 2023, the Group determined the carrying amounts of certain proved properties within two fields were not recoverable from future cash flows, and therefore, were impaired. (d) Other adjusting costs for the year ended December 31, 2024, were primarily associated with legal and professional fees related to the U.S. listing, legal fees for certain litigation, and expenses associated with unused firm transportation agreements. For the year ended December 31, 2023, these costs were primarily related to legal and professional fees for the U.S. listing, legal fees for certain litigation, and expenses for unused firm transportation agreements. For the year ended December 31, 2022, these costs mainly included $28 million in contract terminations, which enabled the Group to secure more favorable future pricing, and $31 million in deal breakage and/ or sourcing costs for acquisitions. (e) Includes adjustments for the year ended December 31, 2024 for the Oaktree, Crescent Pass, and East Texas II acquisitions to pro forma their results for the full twelve months of operations. Similar adjustments were made for the year ended December 31, 2023 for the Tanos II Acquisition, as well as for the year ended December 31, 2022 for the East Texas I and ConocoPhillips acquisitions. 145 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Net Debt As used herein, net debt represents total debt as recognized on the balance sheet, minus cash and restricted cash. Total debt includes borrowings under our Credit Facility and borrowings under, or issuances of, our subsidiaries’ securitization facilities. We believe net debt is a useful indicator of our leverage and capital structure. Net Debt-to-Adjusted EBITDA As used herein, net debt-to-adjusted EBITDA, also referred to as “leverage” or the “leverage ratio,” is calculated by dividing net debt by adjusted EBITDA. We believe this metric is a crucial measure of our financial liquidity and flexibility, and it is also used in the calculation of a key metric in one of our Credit Facility financial covenants. As of December 31, 2024 December 31, 2023 December 31, 2022 Total debt(a) $1,693,242 $1,276,627 $1,440,329 LESS: Cash 5,990 3,753 7,329 LESS: Restricted cash(b) 46,269 36,252 55,388 Net debt $1,640,983 $1,236,622 $1,377,612 Adjusted EBITDA $472,309 $546,788 $502,954 Pro forma adjusted EBITDA(c) $548,570 $553,252 $574,414 Net debt-to-pro forma adjusted EBITDA(d) 3.0x 2.2x 2.4x (a) Includes adjustments for deferred financing costs and original issue discounts, consistent with presentation on the Statement of Financial Position. (b) The increase of restricted cash as of December 31, 2024, is due to the addition of $21 million and $3 million in restricted cash for the ABS VIII Notes and ABS IX Notes, respectively, offset by $7 million and $9 million for the retirement of the ABS III Notes and ABS V Notes, respectively. (c) Includes adjustments for the year ended December 31, 2024 for the Oaktree, Crescent Pass, and East Texas II acquisitions to pro forma their results for the full twelve months of operations. Similar adjustments were made for the year ended December 31, 2023 for the Tanos II Acquisition, as well as for the year ended December 31, 2022 for the East Texas I and ConocoPhillips acquisitions. (d) Does not include adjustments for working capital which are often customary in the market. Total Revenue, Inclusive of Settled Hedges As used herein, total revenue, inclusive of settled hedges, accounts for the impact of derivatives settled in cash. We believe that total revenue, inclusive of settled hedges, is a useful because it enables investors to discern our realized revenue after adjusting for the settlement of derivative contracts. Adjusted EBITDA Margin As used herein, adjusted EBITDA margin is calculated as adjusted EBITDA expressed as a percentage of total revenue, inclusive of settled hedges. Adjusted EBITDA margin encompasses the direct operating costs and the portion of general and administrative costs required to produce each Mcfe. This metric includes operating expense, employee costs, administrative costs and professional services, and recurring allowance for credit losses, which cover both fixed and variable costs components. We believe that adjusted EBITDA margin is a useful measure of our profitability and efficiency, as well as our earnings quality, because it evaluates the Group on a more comparable basis period-over-period, especially given our frequent involvement in transactions that are not comparable between periods. Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Total revenue $794,841 $868,263 $1,919,349 Net gain (loss) on commodity derivative instruments(a) 151,289 178,064 (895,802) Total revenue, inclusive of settled hedges $946,130 $1,046,327 $1,023,547 Adjusted EBITDA $472,309 $546,788 $502,954 Adjusted EBITDA margin 50% 52% 49% (a) Net gain (loss) on commodity derivative settlements represents the cash paid or received on commodity derivative contracts. This excludes settlements on foreign currency and interest rate derivatives, as well as the gain (loss) on fair value adjustments for unsettled financial instruments for each of the periods presented. 146 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Free Cash Flow As used herein, free cash flow represents net cash provided by operating activities, less expenditures on natural gas and oil properties and equipment, and cash paid for interest. We believe that free cash flow is a useful indicator of our ability to generate cash that is available for activities beyond capital expenditures. The Directors believe that free cash flow provides investors with an important perspective on the cash available to service debt obligations, make strategic acquisitions and investments, and pay dividends. Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Net cash provided by operating activities $345,663 $410,132 $387,764 LESS: Expenditures on natural gas and oil properties and equipment (52,100) (74,252) (86,079) LESS: Cash paid for interest (123,141) (116,784) (83,958) Free cash flow $170,422 $219,096 $217,727 Adjusted Operating Cost per Mcfe Adjusted operating cost per Mcfe is a metric that allows us to measure the direct operating costs and the portion of general and administrative costs required to produce each Mcfe. Similar to adjusted EBITDA margin, this metric includes operating expenses, employee costs, administrative costs and professional services, and recurring allowance for credit losses, encompassing both fixed and variable cost components. Employees, administrative costs and professional services As used herein, employees, administrative costs and professional services represents total administrative expenses, excluding costs associated with acquisitions, other adjusting costs, and non-cash expenses. We use this measure because it excludes items that affect the comparability of results or are not indicative of trends in the ongoing business. Year Ended December 31, 2024 December 31, 2023 December 31, 2022 Total production (MMcfe) 289,586 299,632 296,121 Total operating expense $428,902 $440,562 $445,893 Employees, administrative costs and professional services 86,885 78,659 77,172 Recurring allowance for credit losses 101 8,478 — Adjusted operating cost $515,888 $527,699 $523,065 Adjusted operating cost per Mcfe $1.78 $1.76 $1.77 147 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Officers and Professional Advisors Directors David E. Johnson (Non-Executive Chairman (Independent upon appointment)) Martin K. Thomas (Non-Executive Vice Chairman) Rusty Hutson, Jr. (Chief Executive Officer) David J. Turner, Jr. (Independent Non-Executive Director) Sandra M. Stash (Independent Non-Executive Director) Kathryn Z. Klaber (Independent Non-Executive Director) Sylvia Kerrigan (Senior Independent Non-Executive Director) (for the entirety of 2024 through January 24, 2025) Registered Number 09156132 (England and Wales) Registered Office 4th floor Phoenix House 1 Station Hill Reading, Berkshire, RG1 1NB United Kingdom Headquarters 1600 Corporate Drive Birmingham, Alabama 35242 United States Company Secretary Apex Secretaries LLP 6th Floor 140 London Wall London EC2V 5DN United Kingdom Independent Auditors, United Kingdom PricewaterhouseCoopers LLP 1 Embankment Place London WC2N 6RH United Kingdom Independent Registered Public Accounting Firm, United States PricewaterhouseCoopers LLP 569 Brookwood Village #851 Birmingham, AL 35209 United States Legal Advisor, United Kingdom Latham & Watkins (London) LLP 99 Bishopsgate London ECM2 3XF United Kingdom Legal Advisor, United States Gibson, Dunn & Crutcher LLP 811 Main Street Suite 3000 Houston, TX 77002 Competent Person Netherland, Sewell & Associates, Inc. 2100 Ross Avenue, Suite 2200 Dallas, Texas 75201 United States Share Registrar ComputerShare Investor Services PLC The Pavilions, Bridgewater Road Bristol, BS13 8AE United Kingdom Brokers Tennyson Securities 23rd Floor, 20 Fenchurch Street London EC3M 3BY United Kingdom Stifel Nicolaus Europe Limited 150 Cheapside London, EC2V 6ET United Kingdom Peel Hunt LLP 7th Floor, 100 Liverpool Street London EC2M 2AT United Kingdom 148 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Glossary of Terms £ British pound sterling $ U.S. dollar ABS Asset-Backed Security Adjusted EBITDA Adjusted EBITDA is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. Adjusted EBITDA margin Adjusted EBITDA margin is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. Adjusted operating cost Adjusted operating cost is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. Adjusted operating cost per Mcfe Adjusted operating cost per Mcfe is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. AIM Alternative Investment Market APM Alternative Performance Measure Bbl Barrel or barrels of oil or natural gas liquids Bcfe Billions of cubic fee equivalent Board or BOD Board of Directors Boe Barrel of oil equivalent, determined by using the ratio of one Bbl of oil or NGLs to six Mcf of natural gas. The ratio of one barrel of oil or NGLs to six Mcf of natural gas is commonly used in the industry and represents the approximate energy equivalence of oil or NGLs to natural gas, and does not represent the economic equivalency of oil and NGLs to natural gas. The sales price of a barrel of oil or NGLs is considerably higher than the sales price of six Mcf of natural gas. Boepd Barrels of oil equivalent per day Btu A British thermal unit, which is a measure of the amount of energy required to raise the temperature of one pound of water one degree Fahrenheit. CO2 Carbon dioxide CO2e Carbon dioxide equivalent CEO Chief Executive Officer CFO Chief Financial Officer COO Chief Operating Officer DD&A Depreciation, depletion and amortization E&P Exploration and production EBITDA Earnings before interest, tax, depreciation and amortization EBITDAX Earnings before interest, tax, depreciation, amortization and exploration expense EHS Environmental, health & safety Employees, administrative costs and professional services Employees, administrative costs and professional services is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. EPA Environmental Protection Agency EPS Earnings per share ERM Enterprise Risk Management ESG Environmental, Social and Governance EU European Union Free cash flow Free cash flow is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. FTSE Financial Times Stock Exchange G&A General and administrative expense GBP British pound sterling Henry Hub A natural gas pipeline delivery point that serves as the benchmark natural gas price underlying NYMEX natural gas futures contracts. IAS International Accounting Standard IASB International Accounting Standards Board IPO Initial public offering IFRS International Financial Reporting Standards KWh Kilowatt hour LIBOR London Inter-bank Offered Rate LOE Base lease operating expense is defined as the sum of employee and benefit expenses, well operating expense (net), automobile expense and insurance cost. LSE London Stock Exchange Lost Time Incident Rate (“LTIR”) LTIR is the number of work-related lost time incidents per 200,000 work hours. M&A Mergers and acquisitions Mbbls Thousand barrels Mboe Thousand barrels of oil equivalent 149 Table of Contents Diversified Energy Company PLC 2024 Annual Report Additional Information Mboepd Thousand barrels of oil equivalent per day Mcf Thousand cubic feet of natural gas Mcfe Thousand cubic feet of natural gas equivalent Midstream Midstream activities include the processing, storing, transporting and marketing of natural gas, NGLs and oil. Mmboe Million barrels of oil equivalent Mmbtu Million British thermal units Mmcf Million cubic feet of natural gas Mmcfe Million cubic feet of natural gas equivalent Mont Belvieu A mature trading hub with a high level of liquidity and transparency that sets spot and futures prices for NGLs. MT CO2e Metric ton of carbon dioxide equivalent Motor Vehicle Accidents (“MVA”) MVA is the rate of preventable accidents per million miles driven. MT Metric ton Net debt Net debt is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. Net zero Achieving an overall balance between carbon emissions produced and carbon emissions taken out of the atmosphere, which includes making changes to reduce emissions to the lowest amount and offsetting as a last resort. For Diversified net zero means total Scope 1 and 2 GHG emissions. NGLs Natural gas liquids, such as ethane, propane, butane and natural gasoline that are extracted from natural gas production streams. NYMEX New York Mercantile Exchange Oil Includes crude oil and condensate OGMP 2.0 Oil & Gas Methane Partnership 2.0 is a voluntary measurement-based methane emissions reporting initiative of the Unites Nations Environmental Program, where a Gold Standard recognition represents the highest levels (Level 4/5) of reporting. OSHA Occupational Safety and Health Administration Performance Share Award Performance stock unit award PSU Performance stock unit PV-10 A calculation of the present value of estimated future natural gas and oil revenues, net of forecasted direct expenses, and discounted at an annual rate of 10%. This calculation does not consider income taxes and utilizes a pricing assumption consistent with the forward curve at December 31, 2024. Realized price The cash market price less all expected quality, transportation and demand adjustments. Restricted Share Award Restricted stock unit award RSU Restricted stock unit SAM Smarter Asset Management SOFR Secured Overnight Financing Rate TCFD Task Force on Climate-Related Financial Disclosures Total Recordable Incident Rate (“TRIR”) TRIR is the number of work-related injuries per 200,000 work hours. Total revenue, inclusive of settled hedges Total revenue, inclusive of settled hedges, is an APM. Refer to APMs within this Annual Report for information on how this metric is calculated and reconciled to IFRS measures. TSR Total Shareholder Return TTM Trailing twelve months UK United Kingdom U.S. United States USD U.S. dollar WTI West Texas Intermediate grade crude oil, used as a pricing benchmark for sales contracts and NYMEX oil futures contracts.
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