8-K

3

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report: March 11, 2016

(Date of earliest event reported)

(Exact name of registrant as specified in its charter)

Delaware	001-35049	84-0592823
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1400 Woodloch Forest Drive, Suite 300

The Woodlands, Texas 77380

(Address of principal executive offices) (Zip Code)

(281) 298-4246

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02.Results of Operations and Financial Condition.

On March 11, 2016, Earthstone Energy, Inc. (the “Registrant”) issued a press release announcing its financial results for the quarter and year ended December 31, 2015. A copy of the press release is furnished herewith as Exhibit 99.1.

The information in this Current Report on Form 8-K furnished pursuant to Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liability under that section, and they shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 8.01. Other Events.

On March 11, 2016, the Registrant posted to its website, a slideshow presentation, which is attached hereto as Exhibit 99.2.  The Registrant has determined that from time to time is may make presentations to investors and others in the investment banking community utilizing this slideshow, with immaterial modifications.  Furthermore, the Registrant may make these presentations to other parties in the normal course of business which may include commercial banks, potential institutional partners, acquisition candidates, asset sellers and vendors.  The information contained in the presentation materials is summary information that is intended to be considered in the context of the Registrant’s filings with the Securities and Exchange Commission (the “SEC”) and other public announcements that it may make, by press release or otherwise, from time to time.

Forward-Looking Statements

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not strictly historical statements constitute forward-looking statements and may often, but not always, be identified by the use of such words such as “expects,” “believes,” “intends,” “anticipates,” “plans,” “estimates,” “potential,” “possible,” or “probable” or statements that certain actions, events or results “may,” “will,” “should,” or “could” be taken, occur or be achieved. The forward-looking statements include statements about the expected benefits of the proposed transaction to the Registrant and Lynden Energy Corp. (“Lynden”) and their stockholders, the anticipated completion of the proposed transaction or the timing thereof, the expected future reserves, production, financial position, business strategy, revenues, earnings, costs, capital expenditures and debt levels of the combined company, and plans and objectives of management for future operations. Forward-looking statements are based on current expectations and assumptions and analyses made by the Registrant, Lynden and their management in light of experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances. However, whether actual results and developments will conform to expectations is subject to a number of material risks and uncertainties, including but not limited to: the ability to obtain stockholder, court and regulatory approvals of the proposed transaction; the ability to complete the proposed transaction on anticipated terms and timetable; the Registrant’s and Lynden’s ability to integrate successfully after the transaction and achieve anticipated benefits from it; the possibility that various closing conditions for the transaction may not be satisfied or waived; risks relating to any unforeseen liabilities of the Registrant or Lynden; declines in oil, natural gas liquids or natural gas prices; the level of success in exploration, development and production activities; inaccuracies of reserve estimates or assumptions underlying them; revisions to reserve estimates as a result of changes in commodity prices; risks related to level of indebtedness and periodic redeterminations of the borrowing base under the Registrant’s credit agreement; the Registrant’s ability to generate sufficient cash flows from operations to meet the internally funded portion of its capital expenditures budget; the Registrant’s ability to obtain external capital to finance exploration and development operations and acquisitions; the impacts of hedging on results of operations; the Registrant’s ability to replace oil and natural gas reserves; and any loss of senior management or technical personnel. The Registrant’s annual report on Form 10-K for the year ended December 31, 2015, recent current reports on Form 8-K, and other SEC filings discuss some of the important risk factors identified that may affect the Registrant’s business, results of operations, and financial condition. Lynden’s annual report on Form 10-K for the year ended June 30, 2015, quarterly reports on Form 10-Q, recent current reports on Form 8-K, and other SEC filings discuss some of the important risk factors identified that may affect Lynden’s business, results of operations, and financial condition. The Registrant and Lynden undertake no obligation to revise or update publicly any forward-looking statements except as required by law.

Additional Information

This report does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of a vote or proxy. In connection with the proposed transaction, the Registrant and Lynden will file with the SEC a joint proxy and information statement/circular and other relevant documents to be mailed by Lynden and the Registrant to their respective security holders in connection with the proposed transaction. The joint proxy and information statement/circular will also be filed with the Canadian securities regulators. WE URGE INVESTORS AND SECURITY HOLDERS TO READ THE JOINT PROXY AND INFORMATION STATEMENT/CIRCULAR AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE REGISTRANT, LYNDEN AND THE PROPOSED TRANSACTION. Investors and security holders will be able to obtain these materials (when they are available) and other documents filed with the SEC and the Canadian securities regulators free of charge at the SEC’s website, www.sec.gov and

at the System for Electronic Document Analysis and Retrieval (“SEDAR”) at www.sedar.com. In addition, a copy of the joint proxy and information statement/circular (when it becomes available) may be obtained free of charge from the Registrant’s website at www.earthstoneenergy.com, or from Lynden’s website at www.lyndenenergy.com. Investors and security holders may also read and copy any reports, statements and other information filed by Lynden or the Registrant, with the SEC, at the SEC public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 or visit the SEC’s website for further information on its public reference room. In addition, the documents filed with the SEC by the Registrant can be obtained free of charge from the Registrant’s website at www.earthstoneenergy.com or by contacting the Registrant by mail at 1400 Woodloch Forest Drive, Suite 300, The Woodlands, TX, 77380, or by telephone at (281) 298-4246. The documents filed with the SEC by Lynden can be obtained free of charge from Lynden’s website at www.lyndenenergy.com or by contacting Lynden by mail at Suite 1200, 888 Dunsmuir Street, Vancouver, British Columbia, V6C 3K4 or by telephone at (604) 629-2991.

Participants in the Solicitation

The Registrant, Lynden and their respective directors, executive officers and certain other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding the Registrant’s directors and executive officers is available in its proxy statement filed with the SEC by the Registrant on September 21, 2015 in connection with its 2015 annual meeting of stockholders, and information regarding Lynden’s directors and executive officers is available in its management proxy circular filed by Lynden with the SEC on October 21, 2015 in connection with its 2015 annual meeting of stockholders. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint information statement/circular and other relevant materials to be filed with the SEC and the Canadian securities regulators when they become available.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

The following exhibits are included with this Current Report on Form 8-K:

Exhibit No.	Description
99.1	Press Release dated March 11, 2016.
99.2	Slideshow Presentation dated March 2016

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	EARTHSTONE ENERGY, INC.
Date: March 16, 2016	By:	/s/ G. Bret Wonson
		G. Bret Wonson
		Chief Accounting Officer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release dated March 11, 2016.
99.2	Slideshow Presentation dated March 2016

EX-99.1

Exhibit 99.1

FOR IMMEDIATE RELEASE

Earthstone Energy, Inc. Reports Fourth Quarter and Full Year 2015 Results and Provides Guidance for 2016

The Woodlands, Texas, March 11, 2016 – Earthstone Energy, Inc. (NYSE MKT: ESTE) (“Earthstone”, the “Company”, “we” or “us”), today announced financial and operating results for the three and twelve month periods ended December 31, 2015.

For the fourth quarter of 2015, Earthstone reported a net loss attributable to common stockholders of $116.5 million, or $8.42 per diluted share, which included a pre-tax non-cash impairment charge of $138.1 million; adjusted net loss, a non-GAAP financial measure, of $2.9 million, or $0.21 per diluted share; and adjusted EBITDAX, a non-GAAP financial measure, of $4.3 million. For the year ended December 31, 2015, the Company reported a net loss attributable to common stockholders of $116.7 million, or $8.43 per diluted share, including a pre-tax, non-cash impairment charge of $138.1 million; adjusted net loss of $3.0 million, or $0.22 per diluted share; and adjusted EBITDAX of $25.9 million.

Fourth Quarter 2015 Results

· Average daily production of 3,872 Boepd, a 40% increase compared to the fourth quarter of 2014⁽²⁾;

· Revenues of $8.3 million;

· Adjusted EBITDAX of $4.3 million⁽¹⁾;

· Production-related lease operating expenses of $9.38/Boe⁽²⁾; and

· G&A of $5.95/Boe⁽²⁾

Full Year 2015 Results

· Average daily production of 3,936 barrels of oil equivalent per day (“Boepd”), a 63% increase  compared to the full year 2014;

· Revenues of $49.4 million;

· Adjusted EBITDAX of $25.9 million⁽¹⁾;

· Production-related lease operating expenses of $10.12/Boe; and

· G&A of $7.17/Boe ($6.70 excluding G&A items related to acquisitions)

(1) See “Reconciliation of Non-GAAP Financials Measures” section below.

(2) See “Adjustments Related to Litigation” below for the effect of adjustments recognized in the fourth quarter of 2015.

Drilling and Completions Update

Due to continued poor commodity prices, in late January 2016, the Company suspended operated drilling activities for an initial three month period.  If industry conditions do not improve, we may continue to defer drilling activities.  Likewise, we are deferring completions.  At year-end 2015, the

Company had 12 Eagle Ford wells that were waiting on completion, including four wells at our Boggs Unit in Karnes County, Texas, which is further discussed below.  The remaining eight Eagle Ford wells that were waiting on completion are located in three units in Fayette County, Texas.  Two of these units are held-by-production, and the third unit has no significant leases expiring in 2016.  As a result, the Company has no material, near-term obligations to complete these 12 Eagle Ford wells.

During the fourth quarter of 2015, the Company drilled its four-well Eagle Ford Boggs Unit in Karnes County, Texas (350 gross acres; 33% working interest).  We currently anticipate completing these wells in the second half of 2016.  One well has a lateral length of approximately 7,200 feet and will be completed with 32 stages, and three wells have lateral lengths of approximately 6,500 feet and will be completed with 30 stages.  Completion costs are expected to be less than $100,000 per stage.  In addition, the Company recently drilled its South Green Upper Austin Chalk well in Fayette County, Texas.  The Upper Austin Chalk is naturally fractured and does not require fracture stimulation.  This well is situated within a 1,475 gross acre unit in which the Company has a 47% working interest.  The well was recently brought online at a rate of approximately 475 Boepd (95% oil).  This producing unit will hold all mineral rights through the Eagle Ford in the unit for future development.

Selected Financial Data

($000s except where noted)	Three Months Ended December 31,		Years Ended December 31,
	2015	2014	2015	2014
Total Revenue	8,258	12,108	49,390	47,994
Net Loss(1)	(116,513)	(37,318)	(116,655)	(28,834)
Earnings Per Share (Diluted)	(8.42)	(3.83)	(8.43)	(3.11)
Adjusted Net Loss(2)	(2,919)	1,171	(3,004)	6,160
Adjusted Earnings Per Share (Diluted)(2)	(0.21)	0.12	(0.22)	0.63
Adjusted EBITDAX(2)	4,335	7,336	25,890	28,455
Production(3):
Oil (MBbls)	233	141	904	403
Gas (MMcf)	471	487	2,143	2,132
NGL (MBbls)	45	32	176	124
Total (MBOE)	356	254	1,437	882
Total Daily Production (Boepd)	3,872	2,760	3,936	2,416
Average prices(3):
Including realized derivatives settlements:
Oil ($/Bbl)	46.48	78.25	50.76	88.77
Gas ($/Mcf)	2.11	4.26	2.68	4.29
NGL ($/Bbl)	9.85	20.97	12.29	28.29
Total ($/BOE)	34.41	54.21	37.43	54.87
Excluding realized derivatives settlements:
Oil ($/Bbl)	37.34	67.05	44.09	86.29
Gas ($/Mcf)	2.11	3.91	2.55	4.39
NGL ($/Bbl)	9.85	20.97	12.29	28.29
Total ($/BOE)	28.44	47.33	33.04	53.99

(1) The net loss in 2015 includes $138.1 million of impairment expenses resulting from significant commodity price declines. The net loss in 2014 includes $22.1 million of deferred income tax expense resulting from the strategic combination of Earthstone and Oak Valley Resources, LLC, and $19.4 million of impairment expense, both of which are non-cash charges.  Please see our annual report on Form 10-K for the years ended December 31, 2015 and 2014 for further information.

(2) See “Reconciliation of Non-GAAP Financials Measures” section below.

(3) See Adjustments Related to Litigation below. To appropriately reflect operations, production and average prices presented in the above table for the fourth quarter of 2015 exclude the effects of adjustments related to accruals recorded in prior periods.

Adjustments Related to Litigation

In connection with certain continuing litigation, the Company in February 2016 received a legal opinion from its litigation counsel, after consultation with the opposing party’s legal counsel, generally advising that accepting “non-consent status” for nine non-operated gas wells, located in La Salle County, Texas, would result in the sole remedy for collection of alleged, but contested, sums due to the operator, which totaled approximately $9.2 million.  These wells were drilled in 2014 and placed on production in the first half of 2015.  In accordance with generally accepted accounting principles (“GAAP”), the Company recorded or accrued liabilities associated with well costs and also with estimated production and associated revenues and operating expenses in prior periods.  These amounts were all reversed in the fourth quarter of 2015. The reduction to accrued liabilities, production volumes, revenues and operating expenses were approximately as follows:

1. Accrued liabilities of $9.2 million;

2. 104 MBoe (12% oil, 59% natural gas, 29% natural gas liquids)

3. Revenues of $1.9 million; and

4. Operating expenses of $0.9 million

2015 Year-End Proved Reserves

The Company’s estimated proved reserves at year-end 2015, which were prepared in accordance with Securities and Exchange Commission (“SEC”) guidelines by the independent reservoir engineering firm of Cawley, Gillespie & Associates, Inc., were approximately 12.6 million barrels of oil equivalent (“MMBoe”), 69% of which were proved developed and 74% of which were oil.

SEC rules require that calculations of economically recoverable reserves use the unweighted average price on the first day of the month for the prior twelve month period.  The resulting oil and natural gas prices used for the Company’s 2015 year-end reserve report, prior to adjusting for quality and basis differentials, were $50.28 per barrel and $2.59 per MMBtu, respectively.  A comparison of the SEC benchmark prices and adjusted prices used at December 31, 2015 and 2014 is provided in the following table.

	December 31, 2015		December 31, 2014
	SEC	SEC Adjusted for Differentials	SEC	SEC Adjusted for Differentials
Oil ($/Barrel)	50.28	44.97	94.99	89.84
Natural Gas ($/MMBtu)	2.59	2.77	4.31	4.22

Based on such prices, the Company’s estimated proved reserves by category as of December 31, 2015, are provided in the following table.

Reserve Category	Oil (MBbls)	Gas (MMcf)	NGL (MBbls)	Total (MBoe)	PV-10 ($m)
Proved Developed	6,114	10,954	674	8,614	94,585
Proved Undeveloped	3,247	2,384	317	3,961	9,811
Total	9,361	13,338	991	12,575	104,396

Note: PV-10 is a non-GAAP financial measure. See “Reconciliation of Non-GAAP Financial Measures.”

Our drilling and completion activities in 2015 were focused on capturing as much acreage as reasonably possible and minimizing near-term lease expirations in order to preserve acreage and upside for future development. Accordingly, most of our drilling efforts, both in the Upper Austin Chalk and in the Eagle Ford were directed towards locations that were classified as proved undeveloped at the beginning of 2015. Many of these locations had near-term lease expirations.  In addition to capturing acreage, these locations, which were in close proximity to existing production, provided low cost, ready access to existing gathering lines and certain other operating economies, such as multiple units being drilled from common pads.  As a result of drilling and acquisitions in 2015, we replaced approximately 180% of our production.

Impairments

The Company follows the successful efforts method of accounting for its oil and gas properties. Pursuant to GAAP, the Company is required to recognize a non-cash impairment expense when events and circumstances indicate that the recorded carrying value of properties may not be fully recoverable. Generally, under GAAP, an impairment of producing properties is indicated when the pre-tax future net undiscounted cash flows are less than the net book value at the end of the period being measured. If the net capitalized cost exceeds undiscounted future cash flows, the cost of the property is written down to “fair value”, which can be determined using differing methodologies, including market metrics, or expected future cash flows using prices and costs consistent with those used in the marketplace or for internal decision making, and using discount rates commensurate with the risks involved. Different pricing assumptions or discount rates could result in different calculated impairments. Impairments of significant undeveloped properties are recorded when capitalized costs exceed “fair value”. Factors considered in the impairment of unproved properties, include but are not limited to, remaining lease term, drilling results, reservoir performance, seismic interpretation, or future plans to develop acreage. Goodwill represents the excess of the purchase price over the estimated fair value of the assets acquired net of the fair value of liabilities assumed in an acquisition. GAAP requires that intangible assets with indefinite lives, including goodwill, be evaluated on an annual basis for impairment.  Each component of an impairment calculation is subject to a large degree of judgment, including the determination of estimated economically recoverable reserves, estimated future net cash flows, and fair value.

During the year ended December 31, 2015, the Company recognized non-cash impairment expense of $138.1 million, including $94.0 million related to its proved properties, $42.6 million related to its unproved properties, and $1.5 million related to goodwill.

Hedging Update

In January 2016, the Company entered into hedge transactions associated with its natural gas production.  Swaps covering 770,000 MMBtu from February 2016 through December 2016 were

executed at $2.530/MMBtu, and swaps covering 480,000 MMBtu from January 2017 through December 2017 were executed at $2.785/MMBtu.

In March 2016, the Company entered into hedge transactions associated with its oil production.  Swaps covering 10,000 barrel per month from April 2016 through March 2017 were executed at $42.30 per barrel.

Lynden Energy Corp. – Transaction Update

As previously announced on December 17, 2015, the Company entered into a definitive agreement whereby the Company will acquire Lynden Energy Corp. (TSX Venture: LVL.V; OTC Pink: LVLEF) (“Lynden”) in an all-stock transaction (the “Transaction”).  At closing, Earthstone will issue approximately 3.7 million shares of its common stock to Lynden stockholders, which will represent approximately 21% of Earthstone’s outstanding common stock following the closing.  A meeting of Lynden stockholders is expected to occur in the second quarter of 2016 whereby Lynden stockholders will vote on the transaction, with closing expected shortly thereafter.  The following table is Earthstone’s estimates of Lynden’s proved reserves as of December 31, 2015, prepared in accordance with SEC guidelines.  These reserves do not include any proved horizontal potential.

Reserve Category	Oil (MBbls)	Gas (MMcf)	NGL (MBbls	Total (MBoe)	PV-10 ($m)
Proved Developed	2,297	5,360	957	4,147	36,768
Proved Undeveloped	531	1,751	312	1,135	4,701
Total	2,828	7,111	1,269	5,282	41,469

Note: PV-10 is a non-GAAP financial measure. See “Reconciliation of Non-GAAP Financial Measures.”

Preliminary Guidance

The following preliminary guidance is subject to significant and material changes.  For purposes of this preliminary guidance, we have assumed that the Lynden acquisition closes at the end of April 2016, and, therefore, the values and metrics provided below include estimated contributions from Lynden’s assets for the period of May 2016 through December 2016.  It is currently the intent of management to keep capital expenditures within operating cash flow.  Management intends to adjust these estimates as required as we move through closing of the Lynden transaction and 2016.

Capital Expenditures	$ millions (Net)	Number of Gross Wells Spudded	Number of Gross Wells On Line
Drilling and Completion:
Operated Eagle Ford	5.0	0	4
Non-Operated Bakken	7.0	10	35
Non-Operated Midland Basin – Horizontal	3.2	1	1
Non-Operated Midland Basin – Vertical	1.0	1	1
Non-Operated Mitchell Ranch	1.8	4	4
Land	2.5
Total	20.5	16	45

Production (Boepd)	4,800 – 5,200
% Oil	63%
% Gas	24%
% NGL	13%
Operating Costs ($/Boe)
Lease Operating and Workover	10.00 – 11.00
Production Taxes	1.50 – 2.00
Cash G&A	4.00 – 4.50

Note: Guidance is forward-looking information that is subject to a number of risks and uncertainties, many of which are beyond the Company’s control. See “Forward-Looking Statements” section below.

Management Comments

Frank A. Lodzinski, President and Chief Executive Officer of Earthstone Energy, Inc., commented, “During 2015 we accomplished our goals. These included (i) securing a meaningful and accretive corporate acquisition which also facilitates our entry into the Permian Basin; (ii) lowering our cost structure related to capital expenditures, operating costs, and G&A; and (iii) converting a large portion of our acreage to HBP status while improving our lease expiration profile to minimize near-term lease expirations. In our operated Eagle Ford area, we preserved upside opportunity associated with the Eagle Ford, Upper Eagle Ford, Austin Chalk, and potentially other formations for the future. At year end, approximately 60% of our operated acreage is held–by-production (“HBP”) and only about 2,400 net acres could expire in 2016. In the Williston Basin, nearly all of our acreage is HBP and held for future Bakken and Three Forks development. Accordingly, we are well positioned to suspend drilling and defer completion activities and continue to deal with this low price environment. We will limit capital expenditures to remain within operating cash flows. Our 12 well frac inventory provides us an opportunity to rapidly and significantly ramp up production, pending price increases, while reactivating our drilling programs.  We continue to focus on optimizing our cost structure and field operations while remaining active in pursuing corporate and asset acquisitions with current production and upside that can perform in a low price environment.  Our deal with Lynden is such a transaction that brings additional production with reasonable operating costs as well as de-risked upside potential in the premier Midland Basin.  Much of the Lynden leasehold is also HBP and capital expenditures are largely discretionary.  As 2016 progresses, we expect to close our pending acquisition and pursue additional acquisitions.”

Conference Call Details

Earthstone is hosting a conference call on Monday, March 14, 2016 at 10:00 a.m. EST to discuss its fourth quarter and full year 2015 results and current operations.  Investors and analysts are invited to participate in the call by dialing 877-407-8035 for domestic calls or 201-689-8035 for international calls, in both cases asking for the Earthstone conference call.

A replay of the call will be available on the Company’s website and by telephone until 11:59 p.m. Eastern (10:59 p.m. Central), Monday, March 14, 2016.  The number for the replay is 877-660-6853 for domestic calls or 201-612-7415 for international calls, using Conference ID:13632424.

About Earthstone Energy, Inc.

Earthstone Energy, Inc. is a growth-oriented independent oil and gas exploration and production company engaged in the development and acquisition of oil and gas reserves through an active and diversified program that includes the acquisition, drilling and development of undeveloped leases, asset and corporate acquisitions and exploration activities, with its current primary assets located in the

Eagle Ford trend of south Texas and in the Williston Basin of North Dakota.Earthstone is traded on NYSE MKT under the symbol “ESTE.” Information on Earthstone can be found at www.earthstoneenergy.com. Our corporate headquarters is located in The Woodlands, Texas. We also have an operating office in Denver, Colorado.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements that are not strictly historical statements constitute forward-looking statements and may often, but not always, be identified by the use of such words such as “expects,” “believes,” “intends,” “anticipates,” “plans,” “estimates,” “potential,” “possible,” or “probable” or statements that certain actions, events or results “may,” “will,” “should,” or “could” be taken, occur or be achieved. The forward-looking statements include statements about future operations, expansion of production and development acreage, increased cash flow, earnings and assets and access to capital. Forward-looking statements are based on current expectations and assumptions and analyses made by Earthstone and its management in light of experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances. However, whether actual results and developments will conform to expectations is subject to a number of material risks and uncertainties, including but not limited to: the risks of the oil and gas industry (for example, the recent rapid, significant decline in oil prices and operational risks in exploring for, developing and producing crude oil and natural gas; risks and uncertainties involving geology of oil and gas deposits); the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to future oil and gas prices, production, costs and expenses; potential delays or changes in plans with respect to exploration or development projects or capital expenditures; health, safety and environmental risks and risks related to weather; inability of management to execute its plans to meet its goals; unavailability of gathering systems, pipelines and processing facilities; and the possibility that government policies may change. Earthstone’s annual report on Form 10-K for the year ended December 31, 2015, recent current reports on Form 8-K, and other SEC filings discuss some of the important risk factors identified that may affect Earthstone’s business, results of operations, and financial condition. Earthstone undertakes no obligation to revise or update publicly any forward-looking statements except as required by law.

Additional Information About the Proposed Transaction

This release does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of a vote or proxy. The proposed Transaction anticipates that the sale of Earthstone shares will be exempt from registration under the Securities Act, pursuant to Section 3(a)(10) of the Securities Act. Consequently, the Earthstone shares will not be registered under the Securities Act or any state securities laws.

In connection with the Transaction, Earthstone and Lynden have filed with the SEC a preliminary joint information statement/circular and will file a definitive joint information statement/circular and other relevant documents to be mailed by Lynden and Earthstone to their respective security holders in connection with the proposed Transaction. The joint information statement/circular will also be filed with the Canadian securities regulators. WE URGE INVESTORS AND SECURITY HOLDERS TO READ THE JOINT INFORMATION STATEMENT/ CIRCULAR AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION about Earthstone, LYNDEN and the proposed transaction. Investors and security holders will be able to obtain these materials (when they are available) and other documents filed with the SEC and the Canadian securities regulators free of charge at the SEC's website, www.sec.gov and at the System for Electronic Document Analysis and

Retrieval (SEDAR) at www.sedar.com. In addition, a copy of the joint information statement/circular (when it becomes available) may be obtained free of charge from Earthstone's website at www.earthstoneenergy.com, or from Lynden's website at www.lyndenenergy.com. Investors and security holders may also read and copy any reports, statements and other information filed by Lynden or Earthstone, with the SEC, at the SEC public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 or visit the SEC's website for further information on its public reference room. In addition, the documents filed with the SEC by Earthstone can be obtained free of charge from Earthstone's website at www.earthstoneenergy.com or by contacting Earthstone by mail at 1400 Woodloch Forest Drive, Suite 300, The Woodlands, TX, 77380, or by telephone at (281) 298-4246. The documents filed with the SEC by Lynden can be obtained free of charge from Lynden's website at www.lyndenenergy.com or by contacting Lynden by mail at 595 Burrard Street, Suite 2900, Vancouver, British Columbia, V7X 1J5, or by telephone at (604) 629-2991.

Pending Acquisition of Lynden Energy Corp. - Participants in the Solicitation

Earthstone, Lynden and their respective directors, executive officers and certain other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed Transaction.  Information regarding Earthstone’s directors and executive officers is available in its proxy statement filed with the SEC by Earthstone on September 21, 2015 in connection with its 2015 annual meeting of stockholders, and information regarding Lynden’s directors and executive officers is available in its management proxy circular filed by Lynden with the SEC on October 21, 2015 in connection with its annual meeting of stockholders. This release shall not constitute an offer to sell or the solicitation of any offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.

Contact:

Neil K. Cohen

Vice President, Finance, and Treasurer

Earthstone Energy, Inc.

1400 Woodloch Forest Drive, Suite 300

The Woodlands, TX 77380

281-298-4246

EARTHSTONE ENERGY, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

	December 31,
ASSETS	2015			2014
Current assets:
Cash and cash equivalents	$	23,264		$	100,447
Accounts receivable:
Oil, natural gas, and natural gas liquids revenues		13,529			14,016
Joint interest billings and other		4,924			9,417
Current derivative assets		3,694			3,569
Prepaid expenses and other current assets		498			1,578
Total current assets		45,909			129,027
Oil and gas properties, successful efforts method:
Proved properties		283,644			317,006
Unproved properties		34,609			76,791
Total oil and gas properties		318,253			393,797
Accumulated depreciation, depletion, and amortization		(119,920	)		(97,920	)
Net oil and gas properties		198,333			295,877
Other noncurrent assets:
Goodwill		17,532			22,992
Office and other equipment, less accumulated depreciation of $1,028 in 2015 and $474 in    2014		1,934			2,109
Land		—			101
Other noncurrent assets		1,236			1,282
TOTAL ASSETS	$	264,944		$	451,388
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable	$	11,580		$	28,753
Accrued expenses		12,975			20,529
Revenues and royalties payable		8,576			17,364
Advances		15,447			21,398
Asset retirement obligations		—			408
Total current liabilities		48,578			88,452
Noncurrent liabilities:
Long-term debt		11,191			11,191
Asset retirement obligations		5,075			5,670
Deferred tax liability		—			29,258
Other noncurrent liabilities		227			289
Total noncurrent liabilities		16,493			46,408
Total liabilities		65,071			134,860
Commitments and Contingencies (Note 12)
Equity:
Preferred stock, $0.001 par value, 20,000,000 shares authorized; none issued    or outstanding		—			—
Common stock, $0.001 par value, 100,000,000 shares authorized; 13,835,128 shares issued    and outstanding in 2015 and 2014		14			14
Additional paid-in capital		358,086			358,086
Accumulated deficit		(157,767	)		(41,112	)
Treasury stock, 15,357 shares in 2015 and 2014		(460	)		(460	)
Total equity		199,873			316,528
TOTAL LIABILITIES AND EQUITY	$	264,944		$	451,388

EARTHSTONE ENERGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share amounts)

	Years Ended December 31,
	2015			2014			2013
REVENUES
Oil, natural gas, and natural gas liquids revenues:
Oil	$	39,849		$	34,734		$	16,038
Natural gas		5,457			9,367			9,714
Natural gas liquids		2,158			3,510			3,882
Total oil, natural gas, and natural gas liquids revenues		47,464			47,611			29,634
Gathering income		309			383			430
Gain (loss) on sale of oil and gas properties		1,617			—			(121	)
Total revenues		49,390			47,994			29,943
OPERATING COSTS AND EXPENSES
Production costs:
Lease operating expense		15,409			10,122			8,426
Severance taxes		2,582			2,002			1,225
Re-engineering and workovers		872			708			342
Impairment expense		138,086			19,359			12,298
Depreciation, depletion, and amortization		31,228			18,414			17,111
Exploration expense		142			111			2,490
General and administrative expense		10,300			7,864			7,751
Total operating costs and expenses		198,619			58,580			49,643
Loss from operations		(149,229	)		(10,586	)		(19,700	)
OTHER INCOME (EXPENSE)
Interest expense, net		(722	)		(597	)		(487	)
Net gain on derivative contracts		6,431			4,392			296
Other income, net		423			62			16
Total other income (expense)		6,132			3,857			(175	)
Loss before income taxes		(143,097	)		(6,729	)		(19,875	)
Income tax (benefit) expense		(26,442	)		22,105			—
Net loss	$	(116,655	)	$	(28,834	)	$	(19,875	)
Net loss per common share:
Basic	$	(8.43	)	$	(3.11	)	$	(2.18	)
Diluted	$	(8.43	)	$	(3.11	)	$	(2.18	)
Weighted average common shares outstanding:
Basic		13,835,128			9,279,324			9,124,452
Diluted		13,835,128			9,279,324			9,124,452

EARTHSTONE ENERGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

	Years Ended December 31,
	2015			2014			2013
Cash flows from operating activities:
Net loss	$	(116,655	)	$	(28,834	)	$	(19,875	)
Adjustments to reconcile net loss to net cash provided by operating    activities:
Depreciation, depletion, and amortization		31,228			18,414			17,111
Impairment of proved and unproved oil and gas properties		136,539			19,359			12,298
Impairment of goodwill		1,547			—			—
Unrealized (gain) loss on derivative contracts		(125	)		(3,614	)		45
Dry hole costs		—			—			2,096
(Gain) loss on sales of oil and gas properties		(1,617	)		—			121
Accretion of asset retirement obligations		550			317			217
Deferred income taxes		(26,533	)		22,105			—
Amortization of deferred financing costs		264			164			103
Settlement of asset retirement obligations		(108	)		(56	)		—
Changes in assets and liabilities:
Decrease (increase)in accounts receivable		9,246			(5,305	)		(12,141	)
Decrease (increase) in prepaid expenses and other		779			(194	)		(81	)
(Decrease) increase in accounts payable and accrued expenses		(30,887	)		28,408			2,171
(Decrease) increase in revenue and royalties payable		(8,739	)		7,099			9,698
(Decrease) increase in advances		(5,929	)		17,925			3,520
Net cash (used in) provided by operating activities		(10,440	)		75,788			15,283
Cash flows from investing activities:
Acquisitions of oil and gas property		(8,706	)		(18,772	)		(86,687	)
Additions to oil and gas property and equipment		(61,060	)		(83,041	)		(31,162	)
Additions to other property and equipment		(378	)		(1,385	)		(678	)
Reverse acquisition with Oak Valley, net of cash		—			(4,239	)		—
Insurance proceeds		—			—			923
Proceeds from sales of oil and gas properties		3,441			—			488
Proceeds from sale of land		101			—			—
Net cash used in investing activities		(66,602	)		(107,437	)		(117,116	)
Cash flows from financing activities:
Issuance of long-term debt		—			11,191			—
Reduction of long-term debt		—			(10,825	)		—
Deferred financing costs		(141	)		(613	)		(425	)
Contributions, net of issuance costs		—			106,920			107,530
Net cash (used in) provided by financing activities		(141	)		106,673			107,105
Net (decrease) increase in cash and cash equivalents		(77,183	)		75,024			5,272
Cash and cash equivalents at beginning of period		100,447			25,423			20,151
Cash and cash equivalents at end of period	$	23,264		$	100,447		$	25,423
Supplemental disclosure of cash flow information
Cash paid for:
Interest	$	415		$	493		$	375
Taxes	$	—		$	—		$	—
Non-cash investing and financing activities:
Asset retirement obligations	$	150		$	237		$	1,033
Acquisitions of oil and gas properties	$	1,991		$	—		$	—
Stock issued for 2014 Eagle Ford Acquisition Properties	$	—		$	56,425		$	—

Earthstone Energy, Inc.Reconciliation of GAAP to Non-GAAP Financial Measures
Unaudited

Non-GAAP Financial Measures

The non-GAAP financial measures of Adjusted Net Income, Adjusted EBITDAX and PV-10, as calculated by us below, are intended to provide readers with meaningful information that supplements our financial statements prepared in accordance with GAAP. These disclosures may not be comparable to similarly titled measures used by other companies. Further, these non-GAAP measures should only be considered in conjunction with financial statements and disclosures prepared in accordance with GAAP and should not be considered in isolation or as a substitute for GAAP measures, such as net income or loss, operating income or loss, standardized measure of discounted future net cash flows or any other GAAP measure of financial position or results of operations.

I. Adjusted Net Income

Adjusted net income is a non-GAAP financial measure we use to evaluate performance, prior to non-cash gains and losses after applying adjusted income tax expense.  Non-cash gains and losses include unsettled and unrealized gains and losses on derivative contracts, accretion and impairment expense. We believe adjusted net income helps investors compare our results with other oil and natural gas companies. During the year ended December 31, 2015, we changed the methodology for calculating adjusted income tax expense. As such, the prior periods’ adjusted income tax expense has been modified for comparability.

The following presents a reconciliation of income (loss) before income taxes to adjusted net income (loss):

($000s except where noted)	Three Months Ended December 31,		Years Ended December 31,
In thousands except for per share data    (unaudited)	2015	2014	2015	2014
Income (loss) before income taxes	(142,886)	(15,213)	(143,097)	(6,729)
Plus (minus):
Accretion	125	88	550	317
Impairment expense	138,086	19,359	138,086	19,359
Unrealized (gain) loss on derivative contracts	219	(2,460)	(125)	(3,614)
Subtotal	(4,456)	1,774	(4,586)	9,333
Adjusted income tax expense (1)	1,537	(603)	1,582	(3,173)
Adjusted net income	(2,919)	1,171	(3,004)	6,160
Adjusted earnings per share:
Basic and diluted	(0.21)	0.12	(0.22)	0.63
Shares outstanding – basic and diluted
Basic	13,835	9,739	13,835	9,729

(1) Adjusted income tax expense is calculated by applying tax rates of 34.5% for the three and twelve months ended December 31, 2015, respectively, and 34% for the three and twelve months ended December 31, 2014, respectively.  Calculations for 2015 reflect the Company's effective tax rate. Calculations for 2014 reflect the federal statutory tax rate of 34%.

II. Adjusted EBITDAX

Adjusted EBITDAX is used as a supplemental financial measure by our management and by external users of our financial statements, such as investors, commercial banks and others, to assess our operating performance compared to that of other companies in our industry, without regard to financing methods, capital structure or historical costs basis.  It is also used to assess our ability to incur and service debt and fund capital expenditures.  We define “Adjusted EBITDAX” as net income (loss) plus (1) (gain) loss on sale of assets; (2) accretion; (3) impairment expense; (4) depletion, depreciation, and amortization; (5) exploration expense; (6) interest expense; (7) interest income; (8) unrealized (gain) loss on derivatives; and (9) income tax expense (benefit).

Our Adjusted EBITDAX should not be considered an alternative to net income (loss), operating income (loss), cash flow provided by (used in) operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP.  Our Adjusted EBITDAX may not be comparable to similarly titled measures of another company because all companies may not calculate Adjusted EBITDAX in the same manner.

The following table provides a reconciliation of net income to Adjusted EBITDAX for the periods indicated:

($000s)	Three Months Ended December 31,		Years Ended December 31,
	2015	2014	2015	2014
Net (loss)	(116,511)	(37,318)	(116,655)	(28,834)
Loss on sale of assets	50	—	(1,617)	—
Accretion	125	88	550	317
Impairment expense	138,086	19,359	138,086	19,359
Depletion, depreciation, and amortization	8,523	5,383	31,228	18,414
Exploration expense	—	28	142	111
Interest expense	229	160	776	606
Interest income	(13)	(9)	(53)	(9)
Unrealized (gain) loss on derivative contracts	219	(2,460)	(125)	(3,614)
Income tax expense (benefit)	(26,373)	22,105	(26,442)	22,105
Adjusted EBITDAX	4,335	7,336	25,890	28,455

III. PV-10

PV-10 is derived from the Standardized Measure of discounted future net cash flows, which is the most directly comparable GAAP financial measure.  PV-10 is a computation of the Standardized Measure on a pre-tax basis.  PV-10 is equal to the Standardized Measure at the applicable date, before deducting future income taxes, discounted at 10%.  We believe that the presentation of PV-10 is relevant and useful to investors because it presents the discounted future net cash flows attributable to our estimated net proved reserves prior to taking into account future corporate income taxes, and it is a useful measure for evaluating the relative monetary significance of our oil and natural gas properties.  Further, investors may utilize the measure as a basis for comparison of the relative size and value of our reserves to other companies.  We use this measure when assessing the potential return on investment related to our oil and natural gas properties.  PV-10, however, is not a substitute for the Standardized Measure.  Our PV-10 measure and the Standardized Measure do not purport to present the fair value of our oil and natural gas reserves.

The following table provides a reconciliation of PV-10 of the Company’sproved properties to the Standardized Measure (in thousands):

	Year Ended December 31, 2015
	2015
Present value of estimated future net revenues (PV-10)	104,396
Future income taxes, discounted at 10%	—
Standardized measure of discounted future net revenues	104,396

The following table provides a reconciliation of PV-10 of Lynden’s proved properties, as estimated by Earthstone, to the Standardized Measure (in thousands):

	Year Ended December 31, 2015
	2015
Present value of estimated future net revenues (PV-10)	41,469
Future income taxes, discounted at 10%	—
Standardized measure of discounted future net revenues	41,469

Note: Lynden’s future income taxes, discounted at 10%, are not available at this time.

EX-99.2

Business Combination Presentation March 2016 Exhibit 99.2

Disclaimer Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Statements that are not strictly historical statements constitute forward-looking statements and may often, but not always, be identified by the use of such words such as “expects,” “believes,” “intends,” “anticipates,” “plans,” “estimates,” “potential,” “possible,” or “probable” or statements that certain actions, events or results “may,” “will,” “should,” or “could” be taken, occur or be achieved. The forward-looking statements include statements about the expected benefits of the proposed transaction to Earthstone and Lynden and their stockholders, the anticipated completion of the proposed transaction or the timing thereof, the expected future reserves, production, financial position, business strategy, revenues, earnings, costs, capital expenditures and debt levels of the combined company, and plans and objectives of management for future operations. Forward-looking statements are based on current expectations and assumptions and analyses made by Earthstone, Lynden and their management in light of experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances. However, whether actual results and developments will conform to expectations is subject to a number of material risks and uncertainties, including but not limited to: the ability to obtain stockholder, court and regulatory approvals of the proposed transaction; the ability to complete the proposed transaction on anticipated terms and timetable; Earthstone’s and Lynden’s ability to integrate successfully after the transaction and achieve anticipated benefits from it; the possibility that various closing conditions for the transaction may not be satisfied or waived; risks relating to any unforeseen liabilities of Earthstone or Lynden; declines in oil, natural gas liquids or natural gas prices; the level of success in exploration, development and production activities; inaccuracies of reserve estimates or assumptions underlying them; revisions to reserve estimates as a result of changes in commodity prices; risks related to level of indebtedness and periodic redeterminations of the borrowing base under Earthstone’s credit agreement; Earthstone’s ability to generate sufficient cash flows from operations to meet the internally funded portion of its capital expenditures budget; Earthstone’s ability to obtain external capital to finance exploration and development operations and acquisitions; the impacts of hedging on results of operations; Earthstone’s ability to replace oil and natural gas reserves; and any loss of senior management or technical personnel. Earthstone’s annual report on Form 10-K for the year ended December 31, 2015, quarterly reports on Form 10-Q, recent current reports on Form 8-K, and other Securities and Exchange Commission (“SEC”) filings discuss some of the important risk factors identified that may affect Earthstone’s business, results of operations, and financial condition. Lynden’s annual report on Form 10-K for the year ended June 30, 2015, quarterly reports on Form 10-Q, recent current reports on Form 8-K, and other SEC filings discuss some of the important risk factors identified that may affect Lynden’s business, results of operations, and financial condition. Earthstone and Lynden undertake no obligation to revise or update publicly any forward-looking statements except as required by law.

Disclaimer (Cont’d) Additional Information This presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of a vote or proxy. The proposed transaction anticipates that the sale of Earthstone shares will be exempt from registration under the Securities Act, pursuant to Section 3(a)(10) of the Securities Act. Consequently, the Earthstone shares will not be registered under the Securities Act or any state securities laws. In connection with the proposed transaction, Earthstone and Lynden have filed with the SEC a joint information statement/circular and other relevant documents to be mailed by Lynden and Earthstone to their respective security holders in connection with the proposed transaction. The joint information statement/circular will also be filed with the Canadian securities regulators. WE URGE INVESTORS AND SECURITY HOLDERS TO READ THE JOINT INFORMATION STATEMENT/CIRCULAR AND ANY OTHER RELEVANT DOCUMENTS WHEN THEY BECOME AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT EARTHSTONE, LYNDEN AND THE PROPOSED TRANSACTION. Investors and security holders will be able to obtain these materials (when they are available) and other documents filed with the SEC and the Canadian securities regulators free of charge at the SEC’s website, www.sec.gov and at the System for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com. In addition, a copy of the joint information statement/circular (when it becomes available) may be obtained free of charge from Earthstone’s website at www.earthstoneenergy.com, or from Lynden’s website at www.lyndenenergy.com. Investors and security holders may also read and copy any reports, statements and other information filed by Lynden or Earthstone, with the SEC, at the SEC public reference room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 or visit the SEC’s website for further information on its public reference room. In addition, the documents filed with the SEC by Earthstone can be obtained free of charge from Earthstone’s website at www.earthstoneenergy.com or by contacting Earthstone by mail at 1400 Woodloch Forest Drive, Suite 300, The Woodlands, TX, 77380, or by telephone at (281) 298-4246. The documents filed with the SEC by Lynden can be obtained free of charge from Lynden’s website at www.lyndenenergy.com or by contacting Lynden by mail at Suite 1200, 888 Dunsmuir Street, Vancouver, British Columbia, V6C 3K4 or by telephone at (604) 629-2991. Earthstone, Lynden and their respective directors, executive officers and certain other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding Earthstone’s directors and executive officers is available in its proxy statement filed with the SEC by Earthstone on September 21, 2015 in connection with its 2015 annual meeting of stockholders, and information regarding Lynden’s directors and executive officers is available in its management proxy circular filed by Lynden with the SEC on October 21, 2015 in connection with its 2015 annual meeting of stockholders. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the joint information statement/circular and other relevant materials to be filed with the SEC and the Canadian securities regulators when they become available.

Investment Highlights Prudently Managed Balance Sheet Adequate liquidity on hand to fund growth plans Simple and unburdened capital structure—no term debt outstanding Traditional reserve-based credit facility with standard covenants $120.0mm combined borrowing base, $48.4mm drawn1 Combined net debt to annualized Q4 2015 EBITDA of 0.8x Proven Management Team Four prior successful public entities Operational excellence Repeat institutional and high net worth investors Market recognition from investors and sellside research analysts Diversified Shale Play Exposure with Growing Inventory Presence in the most prolific, domestic oil-bearing shale plays—Eagle Ford, Midland Basin, and Bakken Growth through drill bit and significant acquisitions ~600 total gross drilling locations across core plays Upside from down-spacing and other formations Note: 1Combined borrowing base subject to semi-annual redeterminations in May and November

Strategic Objectives Corporate Strategy Asset Strategy Optimize Existing Properties Implement operational improvements and efficiencies Drive down costs related to drilling, completion, and production Fully define geological and engineering upside Enhance Production / Cash Flow Acquire producing assets Pursue tactical operated acquisitions in proximity to existing properties/fields Divest non-core properties Growth Through the Drill Bit Acquire acreage at favorable terms Continue to generate and de-risk high-impact drilling opportunities Execute multi-year development drilling program Deliver superior returns to shareholders Maintain financial flexibility and a strong balance sheet to facilitate additional acquisitions Diversified exposure to the Eagle Ford, Midland Basin, and Bakken Achieve low development, operating, and G&A cost structure Consistently improve operating margins Generate significant cash flow and net income

December 2014 Eagle Ford Asset Acquisition 1,024 Boepd2 December 2014 Strategic Combination Eagle Ford Operator 2,627 Boepd2 Q2/Q3 2015 Eagle Ford Acreage Acquisitions 3,100 Gross Acres Karnes and Gonzales Counties, TX Q2 2016 Midland Basin 1,451 Boepd3 Earthstone – A Platform for Steady Growth Since December 2014, Earthstone has quickly evolved from a micro cap, non-op Bakken company to a small cap, multi-basin operator with additional exposure to the Eagle Ford and Midland Basin Adjusted EBITDAX and production have increased 2.1x and 8.0x, respectively Recent growth was largely facilitated by two corporate transactions and several asset transactions Acquisitions November 2014 Bakken 662 Boepd1 Q2 2016 Eagle Ford Midland Basin Bakken 5,323 Boepd3 Notes: 1Total Earthstone production for the three month period ended September 30, 2014 2Daily production average for December 2014 3 5,323 Boepd, consisting of 3,872 Boepd from Earthstone’s properties and 1,451 Boepd from Lynden’s properties, both as of three month period ended December 31, 2015 3

Earthstone Acquires Lynden Announced December 17, 2015, targeted closing of Q2 2016 3.7mm ESTE shares issued to Lynden Energy Corp. (“LVL”) stockholders Total transaction value of $87.5mm3 Existing ESTE stockholders to own 79% and LVL stockholders to own 21% 17.535mm total shares of common stock outstanding upon closing the transaction Transaction Summary NYSE MKT: “ESTE” 12.6 MMBoe1 82% Liquids / 68% PD 79% Ownership in Combined Company TSX Ventures: “LVL.V” / OTC Pink: “LVLEF” 5.3 MMBoe2 78% Liquids / 79% PD 21% Ownership in Combined Company Notes: 1Proved reserves associated with Earthstone’s properties as estimated by Cawley, Gillespie & Associates, Inc. utilizing SEC price methodology effective December 31, 2015 2Proved reserves associated with Lynden’s properties as estimated by Earthstone management utilizing SEC price methodology effective December 31, 2015 No proved reserves assigned to horizontal drilling locations in the Midland Basin 3Total transaction value of $87.5mm calculated as equity value of $58.3mm based on ESTE’s 30-day VWAP for the period ended December 16, 2015 plus assumption of $29.2mm of net debt outstanding as of September 30, 2015

Lynden Acquisition Rationale Entry into Midland Basin, diversifying and expanding its existing exposure to the Eagle Ford and Bakken Working interests in 107 gross / 43.8 net vertical wells targeting the Wolfberry play Working interests in 2 gross / 0.9 net horizontal Wolfcamp wells in Glasscock County and 2 gross / 0.4 net horizontal wells in Martin County (1 Lower Spraberry well, 1 Wolfcamp well) Significant, de-risked upside with over 150 proved vertical Wolfberry locations on 20 to 40 acre spacing, with potential for over 50 horizontal Wolfcamp A and B gross wells and additional upside in other horizontal targets Well-respected operator, CrownQuest Operating, LLC Additional float and trading volume and potentially greater access to capital Benefits to ESTE Stockholders Proved management team with operational expertise Stock consideration enables further upside to be captured Greater market recognition with enhanced financial scale and flexibility Platform to fully develop existing Midland Basin asset base Diversification to the Eagle Ford and Bakken Benefits to LVL Stockholders

Combined Core Asset Map1 Earthstone Northern Region 1P Reserves (MMBoe)3.0 % PD78% % Oil71% PV-10 ($mm)25.5 Production (Boepd)867 Earthstone Southern Region 1P Reserves (MMBoe)9.5 % PD66% % Oil76% PV-10 ($mm)78.9 Production (Boepd)3,005 Lynden Total Company 1P Reserves (MMBoe)5.3 % PD79% % Oil54% PV-10 ($mm)41.5 Production (Boepd)1,451 Earthstone and Lynden Combined Total Companies 1P Reserves (MMBoe)17.9 % PD71% % Oil68% PV-10 ($mm)145.9 Production (Boepd)5,323 Texas Eagle Ford Midland Basin North Dakota Bakken/Three Forks Earthstone Total Company 1P Reserves (MMBoe)12.6 % PD68% % Oil74% PV-10 ($mm)104.4 Production (Boepd)3,872 Notes: Numbers may not tie due to rounding 1Proved reserves associated with Earthstone’s properties as estimated by Cawley, Gillespie & Associates, Inc. utilizing SEC price methodology effective December 31, 2015 Proved reserves associated with Lynden’s properties as estimated by Earthstone management utilizing SEC price methodology effective December 31, 2015 No proved reserves assigned to horizontal drilling locations in the Midland Basin Production for the three month period ended December 31, 2015 PV-10 is a non-GAAP financial measure. Please see Appendix B for further disclosures

Core Asset Summary Company Earthstone Earthstone Lynden Project Area South Texas Williston Basin Midland Basin Objective Eagle Ford, Austin Chalk Bakken, Three Forks Spraberry, Wolfcamp Counties Karnes, Gonzales, Fayette McKenzie, Dunn Glasscock, Midland, Martin, Howard Proved Reserves (MMBoe, % Oil)1 8.2 MMBoe; 86% Oil 2.9 MMBoe; 70% Oil 5.3 MMBoe; 54% Oil Production2 2,163 867 1,451 Gross Producing Well Count 76 136 111 Net Acres 18,600 5,900 5,883 Working Interest 33% to 50% 4% 20% to 44% Gross Drilling Locations 240 140 200 Total Company Production = 5,323 Boepd, 63% Oil Notes: 1Proved reserves associated with Earthstone’s properties as estimated by Cawley, Gillespie & Associates, Inc. utilizing SEC price methodology effective December 31, 2015 Proved reserves associated with Lynden’s properties as estimated by Earthstone management utilizing SEC price methodology effective December 31, 2015 2Production for the three month period ended December 31, 2015

Proved Reserves by Commodity1 Proved Reserves by Category1 Production by Commodity3 PV-10 by Category1,2 17.9 MMBoe 5,323 Boepd $145.9mm 17.9 MMBoe Combined Asset Summary – 12/31/15 SEC Pricing1 Notes: 1Proved reserves associated with Earthstone’s properties as estimated by Earthstone management utilizing SEC price methodology effective June 30, 2015 Proved reserves associated with Lynden’s properties as estimated by Cawley, Gillespie & Associates, Inc. utilizing SEC price methodology effective June 30, 2015 No proved reserves assigned to horizontal drilling locations in the Midland Basin 2PV-10 is a non-GAAP financial measure. Please see Appendix B for further disclosures 3Production for the three month period ended December 31, 2015

Proved Developed Reserves (MMBoe)1 Total Proved Reserves (MMBoe)1 Combined Asset Summary – 12/31/15 SEC Pricing(1) (Cont’d) Proved SEC PV-10 ($mm)1,2 Production (Boepd)3 Notes: 1Proved reserves associated with Earthstone’s properties as estimated by Earthstone management utilizing SEC price methodology effective June 30, 2015 Proved reserves associated with Lynden’s properties as estimated by Cawley, Gillespie & Associates, Inc. utilizing SEC price methodology effective June 30, 2015 No proved reserves assigned to horizontal drilling locations in the Midland Basin 2PV-10 is a non-GAAP financial measure. Please see Appendix B for further disclosures 3Production for the three month period ended December 31, 2015

Net Debt / EBITDAX Earthstone Maintains an Industry Leading Leverage Profile Source: FactSet as of March 11, 2016 Note: Debt, annualized EBITDAX, and annualized and interest expense as of the most recently reported quarter ESTE adjusted for Lynden transaction As of December 31, 2015, Earthstone and Lynden had combined: Cash of $30.3mm Debt of $$48.4mm Net debt of $18.1mm Q4 2015 annualized EBITDAX = $23.3mm Q4 2015 annualized interest expense = $1.8mm Earthstone + Lynden Debt / EBITDAX = 2.1x Net Debt / EBITDAX = 0.8x EBITDAX / Interest = 12.9x Peers

Combined Capital Structure and Liquidity Total liquidity of $101.9mm Cash of $30.3mm Reserve-based loan remaining availability of $71.6mm $48.4mm drawn on a combined $120.0mm borrowing base1 Standard financial covenants (max total leverage/annualized quarterly EBITDA ratio of 4.0x and min current ratio of 1.0x) 17.535mm common shares outstanding 79% held by ESTE stockholders / 21% held by LVL stockholders 55% held by insiders and affiliated entities 23% held by unaffiliated institutional investors 22% held by retail investors Liquidity Note: 1 Combined borrowing base subject to redetermination

Combined Financials – Twelve Months Ended December 31, 2015 Note: 1Adjusted EBITDAX is a non-GAAP financial measure. Please see Appendix A for a reconciliation of net income to Adjusted EBITDAX

Investor Sponsor Ownership Earthstone Management Friends and Family 52.0% 16.9% JVL Advisors 3.9% Combined Equity Ownership Earthstone is Backed By Top-Tier Investors 17.535mm shares outstanding, of which 21% will be held by Lynden stockholders

Oak Valley Resources, LLC will own 52.0% of the Combined Company. Oak Valley’s investors include: Earthstone Management Significant equity investors CEO has over 40 years of experience Executive officers average over 30 years of industry experience Senior executives have worked together in multiple successful entities EnCap Investments L.P. Leading provider of private equity to the independent E&P sector 25-year history of providing capital Repeat investors Long relationship with Management Vlasic Group Partnered with Management for 26 consecutive years Former investor and director of GeoResources and predecessor entities Previously affiliated with Vlasic Foods prior to sale to Campbell Soup Wells Fargo Energy Capital Part of Wells Fargo Energy Group, a $30bn capital provider to the North American energy industry Predecessor entities have previously invested with Management Friends and Family Many repeat investors Long-term investment horizons Petroleum engineers, geologists, portfolio managers, endowments, family trusts, investment bankers, lawyers, and other accredited persons Source of incremental deal flow and advice

Midland Basin and Eagle Ford Position Overview

Midland Basin – Acreage Position Overview County Gross Acres Lynden Net % Interest Lynden Net Acres Martin 1,757 43.75 769 1,127 20.00 225 Midland 640 43.75 280 Glasscock 4,480 43.75 1,960 Howard 6,121 40.625 2,487 640 25.39 162 Total: 14,765 5,883

Horizontal development in the Midland Basin is exceeding original expectations Increasing industry activity de-risking play Production data from these wells supports strong EURs and returns Vertical Wolfberry confirms quality of acreage Prospective in 8+ separate horizons Midland Basin – Horizontal Potential in Multiple Horizons Several horizontal resource plays being delineated

Initial Horizontal Locations Producing Vertical Well Potential Vertical Well Location Glasscock County – Wind Farms Prospect Area 4,480 gross / 1,960 net acres prospective for the Wolfcamp Leasehold interest of ~44% Lynden’s first two horizontal Wolfcamp wells in Glasscock County were drilled during June and July 2015 Mallard 23 #1H well Lateral length of ~6,900 feet, 35 frac stages Gross production for the first 60 days averaged 505 Boepd (91% oil) McDaniel 2413 #1H Lateral length of ~9,500 feet, 48 frac stages Gross production for the first 60 days averaged 600 Boepd (91% oil) Contiguous acreage block allows for efficient layout of long laterals

6,761 gross / 2,640 net acres prospective for the Wolfcamp Leasehold interest of 25% to 41% First horizontal well planned for August 2016 Increasing vertical and horizontal well activity by other operators in Howard County Offset by Encana and Oxy Contiguous acreage block allows for efficient layout of long laterals Ongoing vertical well program to perpetuate leases Improvements in vertical well completion practices Howard County – Tubb Prospect Area Map Location Operator Well Name 24 Hr IP (BOEPD) 30 Day IP (BOEPD) Lateral Length % Oil 1 Encana (Athlon) Tubb 39 #5H 2,351 1,594 6,705’ 73% 2 Encana Catcher 40 #5H 1,133 695 6,939’ 97% 3 Encana Tubb 39 3908I Waiting on completion data to be released 4 Encana Tubb 39 3909I Waiting on completion data to be released 5 Oxy Patterson 2702 WA Waiting on completion data to be released Lynden Producing Vertical Well 1 2 3 4 5

Unique opportunity in terms of size, contiguous nature, and significant geological potential Covers 165 square miles on Eastern Shelf 50% working interest in ~104,000 gross and net acre lease Coke, Mitchell, and Sterling Counties Several high-impact resource play targets Clearfork, Wolfcamp, Cline, Mississippian Typically shallower than 8,000 feet Mitchell Ranch Eastern Shelf – Mitchell Ranch Overview Mitchell Ranch Midland Basin to Eastern Shelf Simplified Stratigraphic Section

Eagle Ford – Summary Operated Fayette, Gonzales, and Karnes Counties 38,000 gross / 18,600 net leasehold acres Working interests range from 33% to 50% 64 gross producing wells (62 operated / 2 non-op) January 2016 average gross production of ~5,100 Boepd (98% operated) Approximately 240 identified gross Eagle Ford drilling locations Majority of acreage covered by 173 square mile 3-D seismic shoot Avoid faulting for steering Eagle Ford wells Indicate natural fractures Delineate other prospective opportunities Other Potential: Upper Eagle Ford, Austin Chalk, Buda, Wilcox, and Edwards Non-operated La Salle County 25,400 gross / 2,900 net leasehold acres Working interests range from 10% to 15%

UPPER AUSTIN CHALK TARGET LOWER AUSTIN CHALK TARGET EAGLE FORD TARGET 7750’ – 11000’ 8250’ – 11600’ 8300’ – 11650’ Giddings Austin Chalk Field Interval Eagleville Field Interval Southern Bay Eagle Ford Interval Eagle Ford and Austin Chalk Intervals Across the Acreage

Recent Eagle Ford Acquisitions – Karnes and Gonzales Counties Acquired 3,050 gross / 1,185 net acres in Karnes and Southern Gonzales Counties Potential for 33+ gross Eagle Ford locations Laterals of 5,000 feet to 7,000 feet Operational control with 33% to 50% working interest In Q4 2015, drilled four well pad in Karnes County, with first production expected in H2 2016 No near-term lease obligations HBP acreage 2017 to 2018 expirations

Upper Austin Chalk – Naturally Fractured Reservoir January 2016 average gross production of ~400 Boepd (93% operated) 9 gross producing wells (8 operated / 1 non-op) 7,880 gross acres held by production Brought 4 gross wells on line in 2014 and 2 gross wells online in 2015; 1 well brought online in February 2016 Pending well performance, ability to add 8 new locations that can hold over 12,000 gross acres (6,000 net acres) for future Eagle Ford development D&C of $4.3mm per well; 13,000 feet of lateral length (two opposing laterals) Integrating regional geology with 3-D seismic-defined fracture indications ESTE-Operated Producing Well ESTE-Operated Drilling Location

Williston Basin – Bakken/Three Forks Play Expand acreage Acquire production Establish operating presence 5,900 net core acres predominantly in McKenzie and Dunn Counties of North Dakota that are prospective for the Bakken/Three Forks formation 136 gross wells producing Average working interest of ~4% 35 gross wells currently being drilled or completed ~140 potential gross drilling locations Primary operators include: Statoil, Oasis, ConocoPhillips/Burlington, Continental, ExxonMobil/XTO, Marathon, SM Energy Majority of units in McKenzie County, ND Banks Field Largest development area Interest in 22 spacing units Operators down-spacing to 6-7 wells per unit in the Bakken Indian Hill Field Near-Term Strategy Summary Note: Estimated number of locations include proved undeveloped as well as management’s estimates of additional potential. Actual locations drilled and quantities that may be ultimately recovered from Earthstone’s interests could differ substantially from management’s estimates.

Oil and Gas Production Hedged Swap Positions Avg. hedged oil price = $54.17/Bbl Avg. hedged gas price = $2.530/MMBtu Oil / Gas Quantity Oil – BBls/mo Gas – MMBtu/mo Period Fixed Price Oil 5,000 Jan ‘16 – Mar ’16 57.00 Oil 10,000 Jan ‘16 – Jun ’16 58.00 Oil 10,000 Jan ‘16 – Dec ’16 60.80 Oil 10,000 Apr ‘16 – Mar ’17 42.30 Gas 70,000 Feb ‘16 – Dec ‘16 2.530 Gas 40,000 Jan ‘17 – Dec ‘17 2.785 2016 Hedging Summary

Appendix A – Adjusted EBITDAX Adjusted EBITDAX is used as a supplemental financial measure by our management and by external users of our financial statements, such as investors, commercial banks and others, to assess our operating performance compared to that of other companies in our industry, without regard to financing methods, capital structure or historical costs basis. It is also used to assess our ability to incur and service debt and fund capital expenditures. We define “Adjusted EBITDAX” as net income (loss) plus (1) (gain) loss on sale of assets; (2) accretion; (3) impairment expense; (4) depletion, depreciation, and amortization; (5) exploration expense; (5) interest expense; (6) interest income; (7) unrealized (gain) loss on derivatives; (8) income tax expense (benefit); (9) share of loss in equity investment; and (10) unrealized foreign exchange (gain) loss Our Adjusted EBITDAX should not be considered an alternative to net income (loss), operating income (loss), cash flow provided by (used in) operating activities or any other measure of financial performance or liquidity presented in accordance with the generally accepted accounting principles (“GAAP”). Our Adjusted EBITDAX may not be comparable to similarly titled measures of another company because all companies may not calculate Adjusted EBITDAX in the same manner. The following table provides a reconciliation of net income to Adjusted EBITDAX for the twelve months ended December 30, 2015 (in thousands):

Appendix B – PV-10 Present Value Discounted at 10% (“PV-10”) is a non-GAAP financial measure that differs from the GAAP measure “standardized measure of discounted future net cash flows” in that PV-10 is calculated without regard to future income taxes. Earthstone and Lynden management believe that the presentation of the PV-10 value is relevant and useful to investors because it presents the estimated discounted future net cash flows attributable to our estimated proved reserves independent of our income tax attributes, thereby isolating the intrinsic value of the estimated future cash flows attributable to our reserves. Because many factors that are unique to each individual company impact the amount of future income taxes to be paid, Earthstone and Lynden believe the use of a pre-tax measure provides greater comparability of assets when evaluating companies. PV-10 does not necessarily represent the fair market value of oil and natural gas properties. PV-10 is not a measure of financial or operational performance under GAAP, nor should it be considered in isolation or as a substitute for the standardized measure of discounted future net cash flows as defined under GAAP. PV-10s as of December 31, 2015 utilized SEC price methodology and were based on $50.28 per barrel of oil and $2.590 per MMBTU for natural gas.

Frank Lodzinski President and CEO Robert Anderson EVP, Corporate Development and Engineering Neil Cohen VP, Finance, and Treasurer Corporate Headquarters Houston 1400 Woodloch Forest Drive | Suite 300 | The Woodlands, TX 77380 | (281) 298-4246 Denver 633 17th Street | Suite 2320 | Denver, CO 80202 | (303) 296-3076 Website www.earthstoneenergy.com Contact Information