PIONEER NATURAL RESOURCES CO (Form: 10-Q, Received: 05/04/2018 16:28:52)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________

FORM 10-Q

______________________________



ý	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2018



¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number: 1-13245

______________________________

PIONEER NATURAL RESOURCES COMPANY

(Exact name of Registrant as specified in its charter)

______________________________



Delaware		75-2702753
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

5205 N. O'Connor Blvd., Suite 200, Irving, Texas		75039
(Address of principal executive offices)		(Zip Code)

(972) 444-9001

(Registrant's telephone number, including area code)

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

______________________________

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.



Large accelerated filer	ý	Accelerated filer	¨

Non-accelerated filer	o (Do not check if a smaller reporting company)	Smaller reporting company	¨

		Emerging growth company	¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ¨ No ý

Number of shares of Common Stock outstanding as of May 2, 2018 170,427,473

Table of Contents

PIONEER NATURAL RESOURCES COMPANY

TABLE OF CONTENTS



		Page
Cautionary Statement Concerning Forward-Looking Statements		3

Definitions of Certain Terms and Conventions Used Herein		4

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements

	Consolidated Balance Sheets as of March 31, 2018 and December 31, 2017	5

	Consolidated Statements of Operations for the three months ended March 31, 2018 and 2017	7

	Consolidated Statement of Equity for the three months ended March 31, 2018	8

	Consolidated Statements of Cash Flows for the three months ended March 31, 2018 and 2017	9

	Notes to Consolidated Financial Statements	10

Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	25

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	36

Item 4.	Controls and Procedures	40

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	41

Item 1A.	Risk Factors	41

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41

Item 4.	Mine Safety Disclosures	41

Item 6.	Exhibits	42

Signatures		43

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PIONEER NATURAL RESOURCES COMPANY

Cautionary Statement Concerning Forward-Looking Statements

The information in this Quarterly Report on Form 10-Q (this "Report") contains forward-looking statements that involve risks and uncertainties. When used in this document, the words "believes," "plans," "expects," "anticipates," "forecasts," "intends," "continue," "may," "will," "could," "should," "future," "potential," "estimate" or the negative of such terms and similar expressions as they relate to Pioneer Natural Resources Company ("Pioneer" or the "Company") are intended to identify forward-looking statements, which are generally not historical in nature. The forward-looking statements are based on the Company's current expectations, assumptions, estimates and projections about the Company and the industry in which the Company operates. Although the Company believes that the expectations and assumptions reflected in the forward-looking statements are reasonable as and when made, they involve risks and uncertainties that are difficult to predict and, in many cases, beyond the Company's control.

These risks and uncertainties include, among other things, volatility of commodity prices, product supply and demand, competition, the ability to obtain environmental and other permits and the timing thereof, other government regulation or action, the ability to obtain approvals from third parties and negotiate agreements with third parties on mutually acceptable terms, completion of planned divestitures, litigation, the costs and results of drilling and operations, availability of equipment, services, resources and personnel required to perform the Company's drilling and operating activities, access to and availability of transportation, processing, fractionation, refining and export facilities, Pioneer's ability to replace reserves, implement its business plans or complete its development activities as scheduled, access to and cost of capital, the financial strength of counterparties to Pioneer's credit facility, investment instruments and derivative contracts and purchasers of Pioneer's oil, NGL and gas production, uncertainties about estimates of reserves, identification of drilling locations and the ability to add proved reserves in the future, the assumptions underlying production forecasts, quality of technical data, environmental and weather risks, including the possible impacts of climate change, cybersecurity risks, ability to implement planned stock repurchases, the risks associated with the ownership and operation of the Company's industrial sand mining and oilfield services businesses, and acts of war or terrorism. These and other risks are described in the Company's Annual Report on Form 10-K, this Report and other filings with the United States Securities and Exchange Commission. In addition, the Company may be subject to currently unforeseen risks that may have a materially adverse effect on it. Accordingly, no assurances can be given that the actual events and results will not be materially different than the anticipated results described in the forward-looking statements. See "Part I, Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations," "Part 1, Item 3. Quantitative and Qualitative Disclosures About Market Risk" and "Part II, Item 1A. Risk Factors" in this Report and "Part I, Item 1. Business — Competition, Markets and Regulations," "Part I, Item 1A. Risk Factors," "Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk" in the Company's Annual Report on Form 10-K for the year ended December 31, 2017 for a description of various factors that could materially affect the ability of Pioneer to achieve the anticipated results described in the forward-looking statements. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. The Company undertakes no duty to publicly update these statements except as required by law.

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PIONEER NATURAL RESOURCES COMPANY

Definitions of Certain Terms and Conventions Used Herein

Within this Report, the following terms and conventions have specific meanings:


•	"Bbl" means a standard barrel containing 42 United States gallons.


•	"BOE" means a barrel of oil equivalent and is a standard convention used to express oil and gas volumes on a comparable oil equivalent basis. Gas equivalents are determined under the relative energy content method by using the ratio of six thousand cubic feet of gas to one Bbl of oil or natural gas liquid.


•	"BOEPD" means BOE per day.


•	"Btu" means 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.


•	"Conway" means the daily average natural gas liquids components as priced in Oil Price Information Service ("OPIS") in the table "U.S. and Canada LP – Gas Weekly Averages" at Conway, Kansas.


•	"DD&A" means depletion, depreciation and amortization.


•	"GAAP" means accounting principles that are generally accepted in the United States of America.


•	"HH" means Henry Hub, a distribution hub on the natural gas pipeline in Louisiana that serves as the delivery location for futures contracts on the NYMEX.


•	"LIBOR" means London Interbank Offered Rate, which is a market rate of interest.


•	"LLS" means Louisiana Light Sweet oil, a light, sweet blend of oil produced from the Gulf of Mexico.


•	"Mcf" means one thousand cubic feet and is a measure of gas volume.


•	"MMBtu" means one million Btus.


•	"Mont Belvieu" means the daily average natural gas liquids components as priced in OPIS in the table "U.S. and Canada LP – Gas Weekly Averages" at Mont Belvieu, Texas.


•	"NGL" means natural gas liquid.


•	"NYMEX" means the New York Mercantile Exchange.


•	"Pioneer" or the "Company" means Pioneer Natural Resources Company and its subsidiaries.

•

"Proved reserves" mean the quantities of oil and gas, which, by analysis of geoscience and engineering data, can be estimated with reasonable certainty to be economically producible – from a given date forward, from known reservoirs, and under existing economic conditions, operating methods, and government regulations – prior to the time at which contracts providing the right to operate expire, unless evidence indicates that renewal is reasonably certain, regardless of whether deterministic or probabilistic methods are used for the estimation. The project to extract the hydrocarbons must have commenced or the operator must be reasonably certain that it will commence the project within a reasonable time.

(i) The area of the reservoir considered as proved includes: (A) The area identified by drilling and limited by fluid contacts, if any, and (B) Adjacent undrilled portions of the reservoir that can, with reasonable certainty, be judged to be continuous with it and to contain economically producible oil or gas on the basis of available geoscience and engineering data.

(ii) In the absence of data on fluid contacts, proved quantities in a reservoir are limited by the lowest known hydrocarbons ("LKH") as seen in a well penetration unless geoscience, engineering, or performance data and reliable technology establishes a lower contact with reasonable certainty.

(iii) Where direct observation from well penetrations has defined a highest known oil ("HKO") elevation and the potential exists for an associated gas cap, proved oil reserves may be assigned in the structurally higher portions of the reservoir only if geoscience, engineering, or performance data and reliable technology establish the higher contact with reasonable certainty.

(iv) Reserves which can be produced economically through application of improved recovery techniques (including, but not limited to, fluid injection) are included in the proved classification when: (A) Successful testing by a pilot project in an area of the reservoir with properties no more favorable than in the reservoir as a whole, the operation of an installed program in the reservoir or an analogous reservoir, or other evidence using reliable technology establishes the reasonable certainty of the engineering analysis on which the project or program was based; and (B) The project has been approved for development by all necessary parties and entities, including governmental entities.

(v) Existing economic conditions include prices and costs at which economic producibility from a reservoir is to be determined. The price shall be the average during the 12-month period prior to the ending date of the period covered by the report, determined as an unweighted arithmetic average of the first-day-of-the-month price for each month within such period, unless prices are defined by contractual arrangements, excluding escalations based upon future conditions.


•	"U.S." means United States.

•

With respect to information on the working interest in wells, drilling locations and acreage, " net " wells, drilling locations and acres are determined by multiplying " gross " wells, drilling locations and acres by the Company's working interest in such wells, drilling locations or acres. Unless otherwise specified, wells, drilling locations and acreage statistics quoted herein represent gross wells, drilling locations or acres.


•	Unless otherwise indicated, all currency amounts are expressed in U.S. dollars.


•	"WTI" means West Texas Intermediate oil, a light, sweet blend of oil produced from the fields in western Texas.

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

PIONEER NATURAL RESOURCES COMPANY

CONSOLIDATED BALANCE SHEETS

(in millions)



	March 31, 2018			December 31, 2017
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,001		$	896
Short-term investments	722			1,213
Accounts receivable:
Trade, net	826			644
Due from affiliates	—			1
Income taxes receivable	7			7
Inventories	218			212
Assets held for sale	20			—
Derivatives	7			11
Other	23			23
Total current assets	2,824			3,007
Property, plant and equipment, at cost:
Oil and gas properties, using the successful efforts method of accounting:
Proved properties	20,892			20,404
Unproved properties	568			558
Accumulated depletion, depreciation and amortization	(9,230		)	(9,196		)
Total property, plant and equipment	12,230			11,766
Long-term investments	93			66
Goodwill	269			270
Other property and equipment, net	1,799			1,762
Other assets, net	108			132
	$	17,323		$	17,003

The financial information included as of March 31, 2018 has been prepared by management

without audit by independent registered public accountants.

The accompanying notes are an integral part of these consolidated financial statements.

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PIONEER NATURAL RESOURCES COMPANY

CONSOLIDATED BALANCE SHEETS (continued)

(in millions, except share data)



	March 31, 2018			December 31, 2017
	(Unaudited)
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable:
Trade	$	1,222		$	1,174
Due to affiliates	48			108
Interest payable	38			59
Income taxes payable	1			—
Current portion of long-term debt	449			449
Liabilities held for sale	6			—
Derivatives	333			232
Other	153			106
Total current liabilities	2,250			2,128
Long-term debt	2,284			2,283
Derivatives	54			23
Deferred income taxes	928			899
Other liabilities	405			391
Equity:
Common stock, $.01 par value; 500,000,000 shares authorized; 174,288,821 and 173,796,743 shares issued as of March 31, 2018 and December 31, 2017, respectively	2			2
Additional paid-in capital	8,991			8,974
Treasury stock at cost: 3,869,865 and 3,608,132 shares as of March 31, 2018 and December 31, 2017, respectively	(294		)	(249		)
Retained earnings	2,698			2,547
Total equity attributable to common stockholders	11,397			11,274
Noncontrolling interests in consolidated subsidiaries	5			5
Total equity	11,402			11,279
Commitments and contingencies
	$	17,323		$	17,003

The financial information included as of March 31, 2018 has been prepared by management

without audit by independent registered public accountants.

The accompanying notes are an integral part of these consolidated financial statements.

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PIONEER NATURAL RESOURCES COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per share data)

(Unaudited)



	Three Months Ended March 31,
	2018			2017
Revenues and other income:
Oil and gas	$	1,266		$	809
Sales of purchased oil and gas	1,070			316
Interest and other	18			13
Derivative gains (losses), net	(208		)	151
Gain on disposition of assets, net	4			11
	2,150			1,300
Costs and expenses:
Oil and gas production	213			141
Production and ad valorem taxes	76			47
Depletion, depreciation and amortization	357			337
Purchased oil and gas	1,054			335
Impairment of oil and gas properties	—			285
Exploration and abandonments	35			33
General and administrative	90			84
Accretion of discount on asset retirement obligations	4			5
Interest	36			46
Other	57			60
	1,922			1,373
Income (loss) before income taxes	228			(73		)
Income tax benefit (provision)	(50		)	31
Net income (loss) attributable to common stockholders	$	178		$	(42	)

Basic and diluted net income (loss) per share attributable to common stockholders	$	1.04		$	(0.25	)

Weighted average shares outstanding:
Basic	170			170
Diluted	171			170

Dividends declared per share	$	0.16		$	0.04

The financial information included herein has been prepared by management

without audit by independent registered public accountants.

The accompanying notes are an integral part of these consolidated financial statements.

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PIONEER NATURAL RESOURCES COMPANY

CONSOLIDATED STATEMENT OF EQUITY

(in millions, except share data and dividends per share)

(Unaudited)



			Equity Attributable To Common Stockholders
	Shares Outstanding		Common Stock		Additional Paid-in Capital		Treasury Stock			Retained Earnings			Noncontrolling Interests		Total Equity
	(in thousands)
Balance as of December 31, 2017	170,189		$	2	$	8,974	$	(249	)	$	2,547		$	5	$	11,279
Dividends declared ($0.16 per share)	—		—		—		—			(27		)	—		(27		)
Purchases of treasury stock	(262	)	—		—		(45		)	—			—		(45		)
Compensation costs:
Vested compensation awards	492		—		—		—			—			—		—
Compensation costs included in net income	—		—		17		—			—			—		17
Net income	—		—		—		—			178			—		178
Balance as of March 31, 2018	170,419		$	2	$	8,991	$	(294	)	$	2,698		$	5	$	11,402

The financial information included herein has been prepared by management

without audit by independent registered public accountants.

The accompanying notes are an integral part of these consolidated financial statements.

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PIONEER NATURAL RESOURCES COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(Unaudited)



	Three Months Ended March 31,
	2018			2017
Cash flows from operating activities:
Net income (loss)	$	178		$	(42	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depletion, depreciation and amortization	357			337
Impairment of oil and gas properties	—			285
Exploration expenses, including dry holes	7			10
Deferred income taxes	50			(31		)
Gain on disposition of assets, net	(4		)	(11		)
Accretion of discount on asset retirement obligations	4			5
Interest expense	1			1
Derivative related activity	136			(141		)
Amortization of stock-based compensation	17			22
Other	20			25
Change in operating assets and liabilities:
Accounts receivable	(181		)	92
Inventories	(6		)	(19		)
Investments	4			4
Other current assets	(3		)	(6		)
Accounts payable	(9		)	(153		)
Interest payable	(21		)	(29		)
Income taxes payable	1			—
Other current liabilities	3			15
Net cash provided by operating activities	554			364
Cash flows from investing activities:
Proceeds from disposition of assets	4			78
Proceeds from investments	555			458
Purchase of investments	(94		)	(315		)
Additions to oil and gas properties	(818		)	(433		)
Additions to other assets and other property and equipment, net	(51		)	(86		)
Net cash used in investing activities	(404		)	(298		)
Cash flows from financing activities:
Principal payments on long-term debt	—			(485		)
Purchases of treasury stock	(45		)	(36		)
Net cash used in financing activities	(45		)	(521		)
Net increase (decrease) in cash and cash equivalents	105			(455		)
Cash and cash equivalents, beginning of period	896			1,118
Cash and cash equivalents, end of period	$	1,001		$	663

The financial information included herein has been prepared by management

without audit by independent registered public accountants.

The accompanying notes are an integral part of these consolidated financial statements.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

NOTE 1. Organization and Nature of Operations

Pioneer Natural Resources Company ("Pioneer" or the "Company") is a Delaware corporation whose common stock is listed and traded on the New York Stock Exchange. The Company is a large independent oil and gas exploration and production company that explores for, develops and produces oil, natural gas liquids ("NGLs") and gas within the United States, with operations primarily in the Permian Basin in West Texas, the Eagle Ford Shale play in South Texas, the Raton field in southeast Colorado and the West Panhandle field in the Texas Panhandle.

NOTE 2. Basis of Presentation

Presentation. In the opinion of management, the consolidated financial statements of the Company as of March 31, 2018 and for the three months ended March 31, 2018 and 2017 include all adjustments and accruals, consisting only of normal, recurring accrual adjustments, which are necessary for a fair presentation of the results for the interim periods. These interim results are not necessarily indicative of results for a full year.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States ("GAAP") have been condensed in or omitted from this report pursuant to the rules and regulations of the United States Securities and Exchange Commission (the "SEC"). These consolidated financial statements should be read together with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2017 .

Certain reclassifications have been made to the 2017 financial statement and footnote amounts in order to conform to the 2018 presentation.

Assets held for sale. On the date at which the Company meets all the held for sale criteria, the Company discontinues the recording of depletion and depreciation of the assets or asset group to be sold and reclassifies the assets and related liabilities to be sold as held for sale on the accompanying consolidated balance sheets. The assets and liabilities are measured at the lower of their carrying amount or estimated fair value less cost to sell. See Note 3 for additional information about the Company's divestitures.

Adoption of New Accounting Standards. In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09 ("ASC 606") "Revenue from Contracts with Customers," which supersedes the revenue recognition requirements in ASC 605 “Revenue Recognition” ("ASC 605"), and requires entities to recognize revenue when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company adopted ASC 606 as of January 1, 2018 using the modified retrospective transition method. See Note 11 for a discussion of the impact to the Company's recognition of revenue associated with the adoption of ASC 606.

In March 2016, the FASB issued ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting." ASU 2016-09 simplifies several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures and statutory tax withholding requirements, as well as certain classification changes in the statement of cash flows. The Company adopted this standard on January 1, 2017. See Note 14 for a discussion of the impact to the Company's income tax provision associated with the adoption of ASU 2016-09.

New accounting pronouncements. In February 2016, the FASB issued ASU 2016-02, "Leases." ASU 2016-02 requires the recognition of lease assets and lease liabilities by lessees for those leases currently classified as operating leases and makes certain changes to the accounting for lease expenses. This update is effective for fiscal years beginning after December 15, 2018 and for interim periods beginning the following year. This update should be applied using a modified retrospective approach, and early adoption is permitted. The Company anticipates that the adoption of ASU 2016-02 for its leasing arrangements will likely (i) increase the Company's recorded assets and liabilities, (ii) increase depreciation, depletion and amortization expense, (iii) increase interest expense and (iv) decrease lease/rental expense. The Company is currently evaluating each of its lease arrangements and has not determined the aggregate amount of change expected for each category.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

NOTE 3. Divestitures

In February 2018, the Company announced its intention to divest its properties in the South Texas, Raton and West Panhandle fields and focus its efforts and capital resources on its Permian Basin assets. No assurance can be given that the sales will be completed in accordance with the Company's plan or on terms and at prices acceptable to the Company.

In March 2018, the Company entered into a purchase and sale agreement with an unaffiliated third party to sell approximately 10,200 net acres in the western portion of the Eagle Ford Shale ("West Eagle Ford Shale") for cash proceeds, before normal closing adjustments, of approximately $103 million , of which $22 million was received in March 2018. The Company classified the West Eagle Ford Shale assets and liabilities as held for sale in the accompanying consolidated balance sheet as of March 31, 2018 . These asset and liabilities were composed of the following as of March 31, 2018 (the Company had no assets held for sale as of December 31, 2017):



	March 31, 2018
	(in millions)
Composition of assets included in assets held for sale:
Current assets	$	19
Goodwill	1
Total assets	$	20

Composition of liabilities included in liabilities held for sale:
Other liabilities	6
Total liabilities	$	6

See Note 16 for additional information about the completion of the sale of the Company's West Eagle Ford Shale assets subsequent to March 31, 2018.

During the three months ended March 31, 2017 , the Company completed the sales of nonstrategic proved and unproved properties in the Permian Basin for cash proceeds of $72 million , which resulted in a gain of $10 million .

NOTE 4. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or the price paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are based upon inputs that market participants use in pricing an asset or liability, which are characterized according to a hierarchy that prioritizes those inputs based on the degree to which they are observable. Observable inputs represent market data obtained from independent sources, whereas unobservable inputs reflect a company's own market assumptions, which are used if observable inputs are not reasonably available without undue cost and effort. The three input levels of the fair value hierarchy are as follows:


•	Level 1 – quoted prices for identical assets or liabilities in active markets.


•	Level 2 – quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates) and inputs derived principally from or corroborated by observable market data by correlation or other means.


•	Level 3 – unobservable inputs for the asset or liability.

Assets and liabilities measured at fair value on a recurring basis. The fair value input hierarchy level to which an asset or liability measurement in its entirety falls is determined based on the lowest level input that is significant to the measurement in its entirety.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

The following table presents the Company's assets and liabilities that are measured at fair value on a recurring basis as of March 31, 2018 and December 31, 2017 for each of the fair value hierarchy levels:



	Fair Value Measurement as of March 31, 2018 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)		Fair Value as of March 31, 2018
	(in millions)
Assets:
Commodity derivatives	$	—	$	7		$	—	$	7
Deferred compensation plan assets	92		—			—		92
Total assets	92		7			—		99
Liabilities:
Commodity derivatives	—		387			—		387
Total liabilities	—		387			—		387
Total recurring fair value measurements	$	92	$	(380	)	$	—	$	(288	)



	Fair Value Measurement as of December 31, 2017 Using
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)		Fair value as of December 31, 2017
	(in millions)
Assets:
Commodity derivatives	$	—	$	11		$	—	$	11
Deferred compensation plan assets	95		—			—		95
Total assets	95		11			—		106
Liabilities:
Commodity derivatives	—		255			—		255
Total liabilities	—		255			—		255
Total recurring fair value measurements	$	95	$	(244	)	$	—	$	(149	)

Commodity derivatives. The Company's commodity derivatives represent oil, NGL and gas swap contracts, collar contracts and collar contracts with short puts. The asset and liability measurements for the Company's commodity derivative contracts represent Level 2 inputs in the hierarchy. The Company utilizes discounted cash flow and option-pricing models for valuing its commodity derivatives.

The asset and liability values attributable to the Company's commodity derivatives were determined based on inputs that include (i) the contracted notional volumes, (ii) independent active market price quotes, (iii) the applicable estimated credit-adjusted risk-free rate yield curve and (iv) the implied rate of volatility inherent in the collar contracts and collar contracts with short puts, which is based on active and independent market-quoted volatility factors.

Deferred compensation plan assets. The Company's deferred compensation plan assets represent investments in equity and mutual fund securities that are actively traded on major exchanges. These investments are measured based on observable prices on major exchanges. As of March 31, 2018 and December 31, 2017 , the significant inputs to these asset exchange values represented Level 1 independent active exchange market price inputs.

Assets and liabilities measured at fair value on a nonrecurring basis. Certain assets and liabilities are measured at fair value on a nonrecurring basis. These assets and liabilities are not measured at fair value on an ongoing basis, but are subject to

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

fair value adjustments in certain circumstances. These assets and liabilities can include inventory, proved and unproved oil and gas properties and other long-lived assets that are written down to fair value when they are impaired or held for sale.

Proved oil and gas properties . As a result of the Company's proved property impairment assessments, the Company recognized a noncash impairment charge of $285 million to reduce the carrying value of the Raton field during the three months ended March 31, 2017 to its estimated fair value of $186 million .

The Company calculated the fair value of the Raton field as of March 31, 2017 using a discounted future cash flow model. Significant Level 3 assumptions associated with the calculation of the Raton field's discounted future cash flows as of March 31, 2017 included management's longer-term commodity price outlook ("Management's Price Outlook") for oil of $53.65 per barrel ("Bbl") and gas of $3.00 per million British thermal units ("MMBtu") and management's outlook for (i) production, (ii) capital expenditures, (iii) production costs and (iv) estimated proved reserves and risk-adjusted probable reserves. Management's Price Outlooks are developed based on third-party longer-term commodity futures price outlooks as of each measurement date. The expected future net cash flows were discounted using an annual rate of 10 percent to determine fair value.

It is reasonably possible that the Company's estimate of undiscounted future net cash flows attributable to these or other properties may change in the future resulting in the need to impair their carrying values. The primary factors that may affect estimates of future cash flows are (i) future adjustments, both positive and negative, to proved and risk-adjusted probable and possible oil and gas reserves, (ii) results of future drilling activities, (iii) Management's Price Outlooks and (iv) increases or decreases in production and capital costs associated with these reserves.

Financial instruments not carried at fair value. Carrying values and fair values of financial instruments that are not carried at fair value in the accompanying consolidated balance sheets as of March 31, 2018 and December 31, 2017 are as follows:



	March 31, 2018				December 31, 2017
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in millions)
Commercial paper, corporate bonds and time deposits	$	815	$	817	$	1,279	$	1,277
Current portion of long-term debt	$	449	$	451	$	449	$	457
Long-term debt	$	2,284	$	2,423	$	2,283	$	2,479

Commercial paper, corporate bonds and time deposits. Periodically, the Company invests in commercial paper and corporate bonds with investment grade rated entities. The Company also periodically enters into time deposits with financial institutions. The investments are carried at amortized cost and classified as held-to-maturity as the Company has the intent and ability to hold them until they mature. The carrying values of held-to-maturity investments are adjusted for amortization of premiums and accretion of discounts over the remaining life of the investment. Income related to these investments is recorded in interest and other income in the Company's consolidated statements of operations. The Company's investments in corporate bonds represent Level 1 inputs in the hierarchy, while other investments represent Level 2 inputs in the hierarchy. Commercial paper and time deposits are included in cash and cash equivalents if they have maturity dates that are less than 90 days at the date of purchase; otherwise, investments are reflected in short-term investments or long-term investments in the accompanying consolidated balance sheets based on their maturity dates.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

The following tables provide the components of the Company's cash and cash equivalents and investments as of March 31, 2018 and December 31, 2017 :



	March 31, 2018
Consolidated Balance Sheet Location	Cash		Commercial Paper		Corporate Bonds		Time Deposits		Total
	(in millions)
Cash and cash equivalents	$	931	$	20	$	—	$	50	$	1,001
Short-term investments	—		125		398		199		722
Long-term investments	—		—		93		—		93
	$	931	$	145	$	491	$	249	$	1,816



	December 31, 2017
Consolidated Balance Sheet Location	Cash		Commercial Paper		Corporate Bonds		Time Deposits		Total
	(in millions)
Cash and cash equivalents	$	846	$	—	$	—	$	50	$	896
Short-term investments	—		124		642		447		1,213
Long-term investments	—		—		66		—		66
	$	846	$	124	$	708	$	497	$	2,175

Debt obligations. The Company's debt obligations are composed of its senior notes whose fair value is determined utilizing inputs that are Level 2 measurements in the fair value hierarchy. The Company's senior notes represent debt securities that are quoted but not actively traded on major exchanges; therefore, fair values of the Company's senior notes are based on their periodic values as quoted on the major exchanges.

The Company has other financial instruments consisting primarily of receivables, payables and other current assets and liabilities that approximate fair value due to the nature of the instrument and their relatively short maturities. Non-financial assets and liabilities initially measured at fair value include assets acquired and liabilities assumed in a business combination, goodwill and asset retirement obligations.

NOTE 5. Derivative Financial Instruments

The Company utilizes commodity swap contracts, collar contracts and collar contracts with short puts to (i) reduce the effect of price volatility on the commodities the Company produces and sells or consumes, (ii) support the Company's annual capital budgeting and expenditure plans and (iii) reduce commodity price risk associated with certain capital projects. The Company also, from time to time, utilizes interest rate contracts to reduce the effect of interest rate volatility on the Company's indebtedness.

Periodically, the Company may pay a premium to enter into commodity contracts. Premiums paid, if any, have been nominal in relation to the value of the underlying asset in the contract. The Company recognizes the nominal premium payments as an increase to the value of derivative assets when paid. All derivatives are adjusted to fair value as of each balance sheet date.

Oil production derivative activities. All material physical sales contracts governing the Company's oil production are tied directly to, or are highly correlated with, New York Mercantile Exchange ("NYMEX") West Texas Intermediate ("WTI") oil prices. The Company uses derivative contracts to manage oil price volatility and basis swap contracts to reduce basis risk between NYMEX prices and the actual index prices at which the oil is sold.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

The following table sets forth the volumes per day associated with the Company's outstanding oil derivative contracts as of March 31, 2018 and the weighted average oil prices for those contracts:



	2018						Year Ending December 31, 2019
	Second Quarter		Third Quarter		Fourth Quarter		Year Ending December 31, 2019
Collar contracts:
Volume (Bbl)	3,000		3,000		3,000		—
Price per Bbl:
Ceiling	$	58.05	$	58.05	$	58.05	$	—
Floor	$	45.00	$	45.00	$	45.00	$	—
Collar contracts with short puts:
Volume (Bbl)	149,000		154,000		159,000		65,000
Price per Bbl:
Ceiling	$	57.79	$	57.70	$	57.62	$	60.74
Floor	$	47.42	$	47.34	$	47.26	$	52.69
Short put	$	37.38	$	37.31	$	37.23	$	42.69

NGL production derivative activities. All material physical sales contracts governing the Company's NGL production are tied directly or indirectly to either Mont Belvieu, Texas or Conway, Kansas NGL component product prices. The Company uses derivative contracts to manage NGL component price volatility.

The following table sets forth the volumes per day associated with the Company's outstanding NGL derivative contracts as of March 31, 2018 and the weighted average NGL prices for those contracts:



	2018						Year Ending December 31, 2019
	Second Quarter		Third Quarter		Fourth Quarter		Year Ending December 31, 2019
Ethane basis swap contracts (a):
Volume (MMBtu)	6,920		6,920		6,920		6,920
Price differential ($/MMBtu)	$	1.60	$	1.60	$	1.60	$	1.60

____________________


(a)	The ethane basis swap contracts reduce the price volatility of ethane forecasted for sale by the Company at Mont Belvieu, Texas-posted prices. The ethane basis swap contracts fix the basis differential on a NYMEX Henry Hub ("HH") MMBtu equivalent basis. The Company will receive the HH price plus the price differential on 6,920 MMBtu per day, which is equivalent to 2,500 Bbls per day of ethane.

Gas production derivative activities. All material physical sales contracts governing the Company's gas production are tied directly or indirectly to HH gas prices or regional index prices where the gas is sold. The Company uses derivative contracts to manage gas price volatility and basis swap contracts to reduce basis risk between HH prices and actual index prices at which the gas is sold.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

The following table sets forth the volumes per day associated with the Company's outstanding gas derivative contracts as of March 31, 2018 and the weighted average gas prices for those contracts:



	2018						Year Ending December 31, 2019
	Second Quarter		Third Quarter		Fourth Quarter		Year Ending December 31, 2019
Swap contracts:
Volume (MMBtu)	100,000		100,000		100,000		—
Price per MMBtu	$	3.00	$	3.00	$	3.00	$	—
Collar contracts with short puts:
Volume (MMBtu)	50,000		50,000		50,000		—
Price per MMBtu:
Ceiling	$	3.40	$	3.40	$	3.40	$	—
Floor	$	2.75	$	2.75	$	2.75	$	—
Short put	$	2.25	$	2.25	$	2.25	$	—
Basis swap contracts (a):
Southern California index swap volume (MMBtu) (b)	40,000		80,000		66,522		84,932
Price differential ($/MMBtu)	$	0.30	$	0.30	$	0.50	$	0.33

____________________

(a)

Subsequent to March 31, 2018 , the Company entered into additional basis swap contracts that fix the basis differentials between the index price at which the Company sells its Permian Basin gas and the HH index price used in swap contracts and collar contracts with short puts for (i) 20,000 MMBtu per day of July 2018 through September 2019 production with a price differential of $1.54 per MMBtu and (ii) 30,000 MMBtu per day of January through September 2019 production with a price differential of $1.47 per MMBtu.


(b)	The referenced basis swap contracts fix the basis differentials between Permian Basin index prices and southern California index prices for Permian Basin gas forecasted for sale in southern California.

The following table sets forth the volumes per day associated with the Company's outstanding marketing derivative contracts as of March 31, 2018 and the weighted average prices for those contracts:



	2018
	Second Quarter		Third Quarter
Average Daily Oil Transportation Commitments Associated with Derivatives (Bbl):
Basis swap contracts:
Louisiana Light Sweet index swap volume (a) (b)	10,000		6,739
Price differential ($/Bbl)	$	3.18	$	3.18
Magellan East Houston index swap volume (a)	8,659		2,022
Price differential ($/Bbl)	$	3.29	$	3.30

____________________


(a)	The referenced basis swap contracts fix the basis differentials between NYMEX WTI and Louisiana Light Sweet or Magellan East Houston oil prices for Permian Basin oil forecasted for sale in the Gulf Coast region.


(b)	Subsequent to March 31, 2018 , the Company liquidated its Louisiana Light Sweet basis swap contracts for 10,000 Bbl per day of June 2018 through August 2018 transportation commitments for a nominal gain.

Tabular disclosure of derivative financial instruments . All of the Company's derivatives are accounted for as non-hedge derivatives as of March 31, 2018 and December 31, 2017 , and therefore all changes in the fair values of its derivative contracts are recognized as gains or losses in the earnings of the periods in which they occur. The Company classifies the fair value amounts

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

of derivative assets and liabilities as net current or noncurrent derivative assets or net current or noncurrent derivative liabilities, whichever the case may be, by commodity and counterparty. The Company enters into derivatives under master netting arrangements, which, in an event of default, allows the Company to offset payables to and receivables from the defaulting counterparty.

The aggregate fair value of the Company's derivative instruments reported in the accompanying consolidated balance sheets by type and counterparty, including the classification between current and noncurrent assets and liabilities, consists of the following:



Fair Value of Derivative Instruments as of March 31, 2018
Type	Consolidated Balance Sheet Location	Fair Value		Gross Amounts Offset in the Consolidated Balance Sheet			Net Fair Value Presented in the Consolidated Balance Sheet
		(in millions)
Derivatives not designated as hedging instruments
Asset Derivatives:
Commodity price derivatives	Derivatives - current	$	14	$	(7	)	$	7
Commodity price derivatives	Derivatives - noncurrent	$	8	$	(8	)	—
							$	7
Liability Derivatives:
Commodity price derivatives	Derivatives - current	$	340	$	(7	)	$	333
Commodity price derivatives	Derivatives - noncurrent	$	62	$	(8	)	54
							$	387



Fair Value of Derivative Instruments as of December 31, 2017
Type	Consolidated Balance Sheet Location	Fair Value		Gross Amounts Offset in the Consolidated Balance Sheet			Net Fair Value Presented in the Consolidated Balance Sheet
		(in millions)
Derivatives not designated as hedging instruments
Asset Derivatives:
Commodity price derivatives	Derivatives - current	$	13	$	(2	)	$	11
Commodity price derivatives	Derivatives - noncurrent	$	3	$	(3	)	—
							$	11
Liability Derivatives:
Commodity price derivatives	Derivatives - current	$	234	$	(2	)	$	232
Commodity price derivatives	Derivatives - noncurrent	$	26	$	(3	)	23
							$	255

The following table details the location of gains and losses recognized on the Company's derivative contracts in the accompanying consolidated statements of operations:



Derivatives Not Designated as Hedging Instruments	Location of Gain/(Loss) Recognized in Earnings on Derivatives	Three Months Ended March 31,
Derivatives Not Designated as Hedging Instruments		2018			2017
		(in millions)
Commodity price derivatives	Derivative gains (losses), net	$	(208	)	$	151

Derivative Counterparties . The Company uses credit and other financial criteria to evaluate the credit standing of, and to select, counterparties to its derivative instruments. Although the Company does not obtain collateral or otherwise secure the fair value of its derivative instruments, associated credit risk is mitigated by the Company's credit risk policies and procedures.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

NOTE 6. Exploratory Costs

The Company capitalizes exploratory well and project costs until a determination is made that the well or project has either found proved reserves, is impaired or is sold. The Company's capitalized exploratory well and project costs are presented in proved properties in the accompanying consolidated balance sheets. If the exploratory well or project is determined to be impaired, the impaired costs are charged to exploration and abandonments expense.

The following table reflects the Company's capitalized exploratory well and project activity during the three months ended March 31, 2018 :



	Three Months Ended March 31, 2018
	(in millions)
Beginning capitalized exploratory well costs	$	505
Additions to exploratory well costs pending the determination of proved reserves	582
Reclassification due to determination of proved reserves	(607		)
Exploratory well costs charged to exploration and abandonment expense	(4		)
Ending capitalized exploratory well costs	$	476

The following table provides an aging as of March 31, 2018 and December 31, 2017 of capitalized exploratory costs and the number of projects for which exploratory well costs have been capitalized for a period greater than one year, based on the date drilling was completed:



	March 31, 2018		December 31, 2017
	(in millions, except well counts)
Capitalized exploratory well costs that have been suspended:
One year or less	$	464	$	493
More than one year	12		12
	$	476	$	505
Number of wells or projects with exploratory well costs that have been suspended for a period greater than one year	7		7

The projects with exploratory well costs that have been suspended for a period greater than one year as of March 31, 2018 are in the Eagle Ford Shale area. The Company is evaluating both the well performance of similar wells completed in 2017 and whether to drill additional wells near these wells in order for all of the wells in the area to be fracture stimulated as a package, thereby improving the resource recovery for the area. The Company expects to complete its evaluation of these seven wells during 2018.

NOTE 7. Long-term Debt

Credit facility. The Company's long-term debt consists of senior notes, a revolving corporate credit facility (the "Credit Facility") and the effects of issuance costs and discounts. The Credit Facility is maintained with a syndicate of financial institutions and has aggregate loan commitments of $1.5 billion that expire in August 2020. As of March 31, 2018 , the Company had no outstanding borrowings under the Credit Facility and was in compliance with its debt covenants.

Senior notes. The Company's 6.65% senior notes (the " 6.65% Senior Notes") matured and were repaid in March 2017. The Company funded the $485 million repayment of the 6.65% Senior Notes with cash on hand. The Company's 6.875% senior notes (the " 6.875% Senior Notes"), with an outstanding debt principal balance of $450 million , mature in May 2018 and are classified as current in the accompanying consolidated balance sheets as of March 31, 2018 and December 31, 2017 . See Note 16 for additional information regarding the repayment of the Company's 6.875% Senior Notes in May 2018.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

NOTE 8. Incentive Plans

Stock-based compensation. For the three months ended March 31, 2018 , the Company recorded $23 million of stock-based compensation expense for all plans, as compared to $30 million for the same period in 2017 . As of March 31, 2018 , there was $163 million of unrecognized stock-based compensation expense related to unvested share-based compensation plans, including $35 million attributable to stock-based awards that are expected to be settled on their vesting date in cash, rather than in equity shares ("Liability Awards"). The unrecognized compensation expense will be recognized on a straight-line basis over the remaining vesting periods of the awards, which is a period of less than three years on a weighted average basis. As of March 31, 2018 and December 31, 2017 , accounts payable – due to affiliates included $4 million and $20 million , respectively, of liabilities attributable to Liability Awards.

The following table summarizes the activity that occurred during the three months ended March 31, 2018 for restricted stock awards and performance units issued by Pioneer:



	Restricted Stock Equity Awards		Restricted Stock Liability Awards		Performance Units
Outstanding as of December 31, 2017	916,223		252,735		163,158
Awards granted	369,170		108,129		62,541
Awards forfeited	(11,986	)	(2,652	)	(1,285	)
Awards vested	(395,682	)	(121,776	)	—
Outstanding as of March 31, 2018	877,725		236,436		224,414

As of March 31, 2018 and December 31, 2017 , the Company also had 138,493 stock options outstanding and exercisable. There were no stock options exercised during the three months ended March 31, 2018 .

NOTE 9. Asset Retirement Obligations

The Company's asset retirement obligations primarily relate to the future plugging and abandonment of wells and related facilities. The following table summarizes the Company's asset retirement obligation activity during the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018			2017
	(in millions)
Beginning asset retirement obligations	$	271		$	297
New wells placed on production	1			1
Changes in estimates	2			—
Obligations reclassified to liabilities held for sale	(6		)	—
Liabilities settled	(9		)	(6		)
Accretion of discount	4			5
Ending asset retirement obligations	$	263		$	297

The Company records the current and noncurrent portions of asset retirement obligations in other current liabilities and other liabilities, respectively, in the accompanying consolidated balance sheets. As of March 31, 2018 and December 31, 2017 , the current portion of the Company's asset retirement obligations was $40 million and $41 million , respectively.

NOTE 10. Commitments and Contingencies

Legal actions. The Company is a party to various proceedings and claims incidental to its business. While many of these matters involve inherent uncertainty, the Company believes that the amount of the liability, if any, ultimately incurred with respect to such proceedings and claims will not have a material adverse effect on the Company's financial position as a whole or on its liquidity, capital resources or future annual results of operations. The Company records reserves for contingencies when information available indicates that a loss is probable and the amount of the loss can be reasonably estimated.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

Obligations following divestitures. In connection with its divestiture transactions, the Company may retain certain liabilities and provide the purchaser certain indemnifications, subject to defined limitations, which may apply to identified pre-closing matters, including matters of litigation, environmental contingencies, royalty obligations and income taxes. The Company does not believe these obligations are probable of having a material impact on its liquidity, financial position or future results of operations.

Lease agreements. In June 2017, the Company entered into a 20 -year operating lease for the Company's new corporate headquarters that is currently being constructed in Irving, Texas. Annual base rent is expected to be $33 million and lease payments are expected to commence once the building is complete, which is anticipated to occur during the second half of 2019. The Company has a variable equity interest in the entity that is constructing the building. The Company is not the primary beneficiary of the variable interest entity and only has a profit sharing interest after certain economic returns are achieved. The Company has no exposure to the variable interest entity's losses or future liabilities, if any. The Company is the deemed owner of the building (for accounting purposes) during the construction period and is following the build-to-suit accounting guidance. Accordingly, as of March 31, 2018 , the Company has capitalized $79 million of construction costs, including capitalized interest, within other property and equipment and has recognized a corresponding build-to-suit lease liability. The recording of these assets and liabilities are considered noncash investing and financing items, respectively, for purposes of the consolidated statements of cash flows.

Firm purchase, gathering, processing, transportation, and fractionation commitments. The Company from time to time enters into, and as of March 31, 2018 was a party to, take-or-pay agreements, which include contractual commitments to purchase sand and water for use in the Company's drilling operations and contractual commitments with midstream service companies and pipeline carriers for future gathering, processing, transportation, storage and fractionation. These commitments are normal and customary for the Company's business activities.

NOTE 11. Revenue Recognition

Impact of ASC 606 adoption. On January 1, 2018, the Company adopted ASC 606 by applying the modified retrospective method to all revenue contracts as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with historic accounting under ASC 605. The Company completed a detailed review of its revenue contracts, which represent all of the Company's revenue streams including oil, NGL and gas sales and sales of purchased oil and gas, to determine the effect of the new standard for the three months ended March 31, 2018. The Company did not record a change to its opening retained earnings as of January 1, 2018 as there was no material change to the timing or pattern of revenue recognition due to the adoption of ASC 606.

The adoption of ASC 606 as of January 1, 2018 had the following impact on the Company's results of operations for the three months ended March 31, 2018:



	Three Months Ended March 31, 2018
	As Reported		ASC 605 (Without Adoption of ASC 606)		Effect of Change Higher (Lower)
	(in millions)
Revenues and other income:
Oil and gas	$	1,266	$	1,223	$	43
Costs and expenses:
Oil and gas production	$	213	$	170	$	43

Changes in oil and gas revenues and oil and gas production costs (specifically gathering, processing and transportation costs) are due to the conclusion under the control model in ASC 606 that the third-party processor or transporter is only providing gas processing or transportation services and that the Company remains the principal owner of the commodity until sold to the ultimate purchaser. This is a change from ASC 605 where the Company historically recorded gas processing fees as a reduction of revenue recognized by the Company, as these fees were considered necessary to separate the wet gas stream into its sellable components (i.e. dry gas and individual NGL components). Under ASC 605, third-party processing and transportation companies were determined to have control of the commodities being processed and transported. As a result of adopting ASC 606, the Company has modified its presentation of revenues and expenses for these arrangements. Revenues related to these agreements are now presented on a gross basis for amounts expected to be received from third-party purchasers through the marketing process. Gathering,

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

processing and transportation expenses related to these agreements, incurred prior to the transfer of control to the purchaser, are now presented as oil and gas production costs.

Disaggregated revenue from contracts with purchasers. Revenues on sales of oil, NGLs, gas and purchased oil and gas are recognized when control of the product is transferred to the purchaser and payment can be reasonably assured. Sales prices for oil, NGL and gas production are negotiated based on factors normally considered in the industry, such as an index or spot price, distance from the well to the pipeline or market, commodity quality and prevailing supply and demand conditions. As such, the prices of oil, NGLs and gas generally fluctuate based on the relevant market index rates. The following table provides information about disaggregated revenue from contracts with purchasers by product type:



	Three Months Ended March 31, 2018
	(in millions)
Oil sales	$	1,013
NGL sales	165
Gas sales	88
Total oil and gas sales	1,266
Sales of purchased oil and gas	1,070
Total revenue derived from contracts with purchasers	$	2,336

Oil sales . Sales under the Company's oil contracts are generally considered performed when the Company sells oil production at the wellhead and receives an agreed-upon index price, net of any price differentials. The Company recognizes revenue when control transfers to the purchaser at the wellhead based on the net price received.

NGL and gas sales . Sales under the Company's gas processing contracts are recognized when the Company delivers gas to a midstream processing entity at the wellhead or the inlet of the midstream processing entity's system. The midstream processing entity gathers and processes the gas and remits proceeds to the Company for the resulting sales of NGLs and gas. In many cases, the Company elects to take its NGLs and residue gas in-kind at the tailgate of the midstream entity's processing plant and subsequently market the products itself. When the Company elects to take-in-kind, it delivers NGLs and gas to a third-party purchaser at a contractually agreed-upon delivery point and receives a specified index price from the purchaser.

The Company evaluated whether it was the principal or the agent in the natural gas processing transactions and concluded that it is the principal when it has the ability to take-in-kind, which is the case in the majority of the Company's gas processing and transportation contracts. Therefore, beginning January 1, 2018, the Company began recognizing revenue on a gross basis, with the gathering, processing and transportation costs associated with its take-in-kind arrangements being recognized as oil and gas production costs in the Company's accompanying consolidated statement of operations.

Sales of purchased oil and gas . The Company periodically enters into pipeline capacity commitments in order to secure available oil, NGL and gas transportation capacity from the Company's areas of production. The Company enters into purchase transactions with third parties and separate sale transactions with third parties to diversify a portion of the Company's WTI oil sales to the Gulf Coast refinery or international export markets and to satisfy unused pipeline capacity commitments. Revenues and expenses from these transactions are presented on a gross basis as the Company acts as a principal in the transaction by assuming control of the commodities purchased and the responsibility to deliver the commodities sold. Revenue is recognized when control transfers to the purchaser at the delivery point based on the price received from the purchaser. The transportation costs associated with these transactions are presented as a component of purchased oil and gas expense. Firm transportation payments on excess pipeline capacity are included in other expense in the accompanying consolidated statements of operations.

Performance obligations and contract balances. The majority of the Company's product sale commitments are short-term in nature with a contract term of one year or less. The Company typically satisfies its performance obligations upon transfer of control as described above in Disaggregated revenue from contracts with purchasers and records the related revenue in the month production is delivered to the purchaser. Settlement statements for sales of oil, NGLs and gas and sales of purchased oil and gas may not be received for 30 to 60 days after the date production is delivered, and as a result, the Company is required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. The Company records the differences between estimates and the actual amounts received for product sales in the month that payment is received from the purchaser. The implementation of ASC 606 has not changed existing controls around revenue estimates and the accrual

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

process. Historically, differences between the Company's revenue estimates and actual revenue received have not been significant. As of March 31, 2018, the accounts receivable balance representing amounts due or billable under the terms of contracts with purchasers was $793 million .

NOTE 12. Interest and Other Income

The following table provides the components of the Company's interest and other income for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018		2017
	(in millions)
Interest income	$	7	$	6
Deferred compensation plan income	4		2
Seismic data sales	3		—
Severance and sales tax refunds	2		3
Other income	2		2
Total interest and other income	$	18	$	13

NOTE 13. Other Expense

The following table provides the components of the Company's other expense for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018		2017
	(in millions)
Transportation commitment charges (a)	$	34	$	40
Loss from vertical integration services (b)	6		5
Other	17		15
Total other expense	$	57	$	60

____________________


(a)	Primarily represents firm transportation payments on excess pipeline capacity commitments.

(b)

Loss from vertical integration services primarily represents net margins (attributable to third party working interest owners) that result from Company-provided fracture stimulation and well service operations, which are ancillary to and supportive of the Company's oil and gas joint operating activities, and do not represent intercompany transactions. For the three months ended March 31, 2018 , these vertical integration net margins included $34 million of revenues and $40 million of costs and expenses. For the same period in 2017, these vertical integration net margins included $19 million of revenues and $24 million of costs and expenses.

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

NOTE 14. Income Taxes

The Company's income tax benefit (provision) consisted of the following for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018			2017
	(in millions)
Deferred tax benefit (provision)	$	(50	)	$	31

For the three months ended March 31, 2018 , the Company's effective tax rate, excluding income attributable to noncontrolling interests, was 22 percent , as compared to an effective rate of 42 percent for the same period in 2017 . The U.S. statutory rate for the three months ended March 31, 2018 was 21 percent , reflecting the reduction in the federal corporate income tax rate from 35 percent to 21 percent beginning in 2018 as a result of the Tax Cuts and Jobs Act that was enacted in December 2017. The Company's effective tax rate for the three months ended March 31, 2017 differs from the U.S. statutory rate in effect during 2017 of 35 percent primarily due to recognizing excess tax benefits of $8 million associated with the adoption of ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting," which requires excess tax benefits or deficiencies associated with the vesting of long-term incentive awards to be recorded as income tax expense or benefit in the statement of operations rather than as an adjustment to additional paid-in capital in the balance sheet.

The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by the taxing authorities based upon the technical merits of the position. As of March 31, 2018 and December 31, 2017 , the Company had cumulative unrecognized tax benefits of $127 million and $124 million , respectively, resulting from research and experimental expenditures related to horizontal drilling and completions innovations. If all or a portion of the unrecognized tax benefit is sustained upon examination by the taxing authorities, the tax benefit will be recognized as a reduction to the Company's deferred tax liability and will affect the Company's effective tax rate in the period it is recognized. The Company expects to substantially resolve the uncertainties associated with the unrecognized tax benefit by December 2018 .

The Company files income tax returns in the U.S. federal and various state and foreign jurisdictions. The Internal Revenue Service has closed examinations of the 2012 and prior tax years and, with few exceptions, the Company believes that it is no longer subject to examinations by state and foreign tax authorities for years before 2012. As of March 31, 2018 , no adjustments had been proposed in any jurisdiction that would have a significant effect on the Company's liquidity, future results of operations or financial position.

NOTE 15. Net Income (Loss) Per Share

The following table reconciles the Company's net income (loss) attributable to common stockholders to basic and diluted net income (loss) attributable to common stockholders for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018			2017
	(in millions)
Net income (loss) attributable to common stockholders	$	178		$	(42	)
Participating share-based earnings	(1		)	—
Basic and diluted net income (loss) attributable to common stockholders	$	177		$	(42	)

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PIONEER NATURAL RESOURCES COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2018

(Unaudited)

The following table is a reconciliation of basic weighted average shares outstanding to diluted weighted average shares outstanding for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018	2017
	(in millions)
Basic weighted average shares outstanding	170	170
Dilution attributable to stock-based compensation awards	1	—
Diluted weighted average shares outstanding	171	170

Stock repurchase program . In February 2018, the Company's board of directors (the "Board") approved a $100 million common stock repurchase program to offset the impact of dilution associated with annual employee stock awards, of which $83 million remained available for use to purchase shares as of March 31, 2018 . During the three months ended March 31, 2018 , the Company purchased $17 million of common stock pursuant to the program.

NOTE 16. Subsequent Events

Divestitures. In April 2018, the sale of the West Eagle Ford Shale assets was completed, and during April 2018 the Company received the remaining cash proceeds of $81 million . Associated with the sale of the West Eagle Ford Shale assets, the Company expects to recognize a gain on unproved properties sold of $75 million to $85 million (after normal closing adjustments) during the second quarter of 2018. See Note 3 for additional information about the Company's sale of its West Eagle Ford Shale assets.

Senior notes. The Company's outstanding 6.875% Senior Notes matured on May 1, 2018. The Company funded the payment of the $450 million principal balance with cash on hand. See Note 7 for additional information regarding the Company's 6.875% Senior Notes.

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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Financial and Operating Performance

The Company's financial and operating performance for the three months ended March 31, 2018 included the following highlights:


•	Net income attributable to common stockholders for the three months ended March 31, 2018 was $178 million ( $1.04 per diluted share), as compared to net loss of $42 million ( $0.25 per diluted share) for the same period in 2017 . The primary components of the increase in earnings attributable to common stockholders include:


•	a $457 million increase in oil and gas revenues as a result of a 25 percent increase in sales volumes and a 25 percent increase in average realized commodity prices per BOE (inclusive of the effect of the adoption of ASC 606 as described below in Adoption of New Accounting Standards);


•	a $285 million decrease in impairment charges as a result of the impairment recorded in 2017 to reduce the carrying value of the Company's Raton field;


•	a $35 million increase in net sales of purchased oil and gas, primarily due to favorable downstream oil margins on the Company's Gulf Coast refinery and export sales; and


•	a $10 million decrease in interest expense, primarily due to the repayment of the Company's 6.65% senior notes (the "6.65% Senior Notes"), which matured in March 2017; partially offset by


•	a $359 million increase in net derivative losses, primarily as a result of changes in forward commodity prices and the Company's portfolio of derivatives;


•	a $101 million increase in total oil and gas production costs and production and ad valorem taxes, primarily due to the aforementioned increases in commodity prices and sales volumes (inclusive of the effect of the adoption of ASC 606 as described below in Adoption of New Accounting Standards);


•	a $81 million increase in the Company's income tax provision as a result of the improvement in earnings during the three months ended March 31, 2018 , as compared to the same period in 2017; and


•	a $20 million increase in DD&A expense, primarily due to the aforementioned increase in sales volumes.

•

During the three months ended March 31, 2018 , average daily sales volumes increase d by 25 percent to 311,845 BOEPD, as compared to 248,881 BOEPD during the same period in 2017 . The increase in average daily sales volumes for the three months ended March 31, 2018 , as compared to the same period in 2017 , is primarily due to the Company's successful Spraberry/Wolfcamp horizontal drilling program.

•

Average oil and NGL prices increased during the three months ended March 31, 2018 to $61.64 per Bbl and $27.74 per Bbl, respectively, as compared to $49.05 per Bbl and $19.33 per Bbl, respectively, for the same period in 2017 . Average gas prices decreased during the three months ended March 31, 2018 to $2.59 per Mcf, as compared to $2.79 per Mcf for the same period in 2017 . Pricing is inclusive of the effect of the adoption of ASC 606 as described below in Adoption of New Accounting Standards.

•

Net cash provided by operating activities increase d to $554 million for the three months ended March 31, 2018 , as compared to $364 million for the same period in 2017 . The $190 million increase in net cash provided by operating activities for the three months ended March 31, 2018 , as compared to the same period in 2017 , is primarily due to increases in the Company's oil and gas revenues as a result of increases in commodity prices and sales volumes, partially offset by increases in oil and gas production costs, production and ad valorem taxes, cash derivative payments and working capital.


•	As of March 31, 2018 , the Company's net debt to book capitalization was seven percent , as compared to five percent at December 31, 2017 .

Adoption of New Accounting Standard

On January 1, 2018, the Company adopted Financial Accounting Standards Board ("FASB") Accounting Standards Update ("ASU") No. 2014-09 (ASC 606) "Revenue from Contracts with Customers." ASC 606 requires entities to recognize revenue when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. As a result of adopting ASC 606, the Company has modified its presentation of revenues and expenses for certain processing and transportation contracts that were previously netted in oil and gas revenues. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported in accordance with historical accounting under ASC 605.

PIONEER NATURAL RESOURCES COMPANY

Changes in oil and gas revenues and oil and gas production costs (specifically gathering, processing and transportation costs) are due to the conclusion under the control model in ASC 606 that the third-party processor or transporter is only providing gas processing or transportation services and the Company remains the principal owner of the commodity until sold to the ultimate purchaser. This is a change from ASC 605 where the Company historically recorded gas processing fees as a reduction of revenue recognized by the Company, as these fees were considered necessary to separate the wet gas stream into its sellable components (i.e. dry gas and individual NGL components). Under ASC 605, third-party processing and transportation companies were determined to have control of the commodities being processed and transported. As a result, the Company has modified its presentation of revenues and expenses for these arrangements. Sales to third-party purchasers are now presented on a gross basis and gathering, processing and transportation expenses related to these agreements, incurred prior to the transfer of control to the purchaser, are now presented as oil and gas production costs.

The adoption of ASC 606 as of January 1, 2018 had the following impact on the Company's results of operations for the three months ended March 31, 2018:



	As Reported					ASC 605 (Without Adoption of ASC 606)					Effect of Change
	(in millions)		Realized Price			(in millions)		Realized Price			(in millions)		Price impact
Oil and Gas Sales:
Oil sales	$	1,013	$	61.64	per Bbl	$	1,013	$	61.64	per Bbl	$	—	$	—	per Bbl
NGL sales	165		$	27.74	per Bbl	130		$	21.81	per Bbl	35		$	5.93	per Bbl
Gas sales	88		$	2.59	per Mcf	80		$	2.37	per Mcf	8		$	0.22	per Mcf
Oil and gas sales	$	1,266	$	45.11	per BOE	$	1,223	$	43.58	per BOE	$	43	$	1.53	per BOE

Production Costs	$	213	$	7.60	per BOE	$	170	$	6.07	per BOE	$	43	$	1.53	per BOE

See Notes 2 and 11 of Notes to Consolidated Financial Statements in "Item 1. Financial Statements" for additional information regarding the Company's adoption of ASC 606.

Second Quarter 2018 Outlook

Based on current estimates, the Company expects the following operating and financial results for the quarter ending June 30, 2018 :

Production is forecasted to average 312,000 to 322,000 BOEPD. Permian Basin production is forecasted to average between 268 MBOEPD to 276 MBOEPD.

Production costs (including production and ad valorem taxes and transportation costs) are expected to average $10.00 to $12.00 per BOE, reflecting current NYMEX strip commodity prices and the adoption of ASC 606 (see Adoption of New Accounting Standards above and Notes 2 and 11 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information regarding the adoption of ASC 606). DD&A expense is expected to average $12.50 to $14.50 per BOE.

Total exploration and abandonment expense is expected to be $20 million to $30 million . General and administrative expense is expected to be $90 million to $95 million . Interest expense is expected to be $30 million to $35 million , and other expense is expected to be $60 million to $70 million , including $40 million to $45 million of charges associated with excess firm gathering and transportation commitments. Accretion of discount on asset retirement obligations is expected to be $4 million to $7 million .

The Company's effective income tax rate is expected to range from 21 percent to 25 percent . Current income taxes are expected to be less than $5 million .

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Operations and Drilling Highlights

The following table summarizes the Company's average daily oil, NGL, gas and total production by asset area during the three months ended March 31, 2018 :



	Oil (Bbls)	NGLs (Bbls)	Gas (Mcf)	Total (BOE)
Permian Basin	169,820	54,396	215,986	260,214
South Texas - Eagle Ford Shale (a)	9,011	8,178	48,849	25,331
Raton Basin	—	—	83,505	13,917
West Panhandle	1,368	3,091	11,324	6,346
South Texas - Other (a)	2,312	515	19,155	6,019
Other	8	1	50	18
Total	182,519	66,181	378,869	311,845

____________________

(a)

Includes 474 Bbls of oil, 165 Bbls of NGLs and 1,559 Mcf of gas (total of 898 BOEPD) associated with acreage in the western portion of the Eagle Ford Shale, the assets and liabilities of which the Company has classified as held for sale in the accompanying consolidated balance sheet as of March 31, 2018 . See Note 3 and Note 16 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information about the Company's sale of its West Eagle Ford Shale assets.

The Company's liquids production increased to 80 percent of total production on a BOE basis for the three months ended March 31, 2018 , as compared to 77 percent for the same period last year.

The following table summarizes by geographic area the Company's finding and development costs incurred during the three months ended March 31, 2018 :



	Acquisition Costs		Exploration Costs		Development Costs		Asset Retirement Obligations		Total
	Unproved		Exploration Costs		Development Costs		Asset Retirement Obligations		Total
	(in millions)
Permian Basin	$	13	$	605	$	231	$	1	$	850
South Texas - Eagle Ford Shale	—		1		7		—		8
Raton Basin	—		—		1		—		1
West Panhandle	—		2		—		—		2
Total	$	13	$	608	$	239	1		$	861

The following table summarizes the Company's development and exploration/extension drilling activities for the three months ended March 31, 2018 :



	Development Drilling
	Beginning Wells in Progress	Wells Spud	Successful Wells	Unsuccessful Wells	Ending Wells in Progress
Permian Basin	14	9	5	1	17



	Exploration/Extension Drilling
	Beginning Wells in Progress	Wells Spud	Successful Wells	Unsuccessful Wells	Ending Wells in Progress
Permian Basin	125	50	65	—	110
South Texas - Eagle Ford Shale	8	—	—	—	8
West Panhandle	3	—	—	2	1
Total	136	50	65	2	119

Permian Basin area. During 2018, the Company plans to operate 20 rigs in the Spraberry/Wolfcamp field and expects to place on production between 250 and 275 horizontal wells (200 to 225 horizontal wells in the northern portion of the play and approximately 50 horizontal wells in the southern portion of the play). Approximately 60 percent of the horizontal wells are planned to be drilled in the Wolfcamp B interval, 25 percent in the Wolfcamp A interval and the remaining 15 percent will be a combination of wells in the Spraberry Shale intervals (Jo Mill, Lower Spraberry and Middle Spraberry) and a limited appraisal program for the Clearfork and Wolfcamp D intervals. The Company's 2018 appraisal program includes appraising: (i) its first Clearfork

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PIONEER NATURAL RESOURCES COMPANY

horizontal well (located in Midland County), (ii) seven wells in the Jo Mill and Middle Spraberry intervals in conjunction with nine Lower Spraberry Shale wells to determine an optimal development strategy for the Spraberry formation (testing different spacing, staggering, sequencing, and completion design) and (iii) three Wolfcamp D interval wells. Of the wells expected to be placed on production during 2018, the Company expects to test an additional 45 higher intensity completions during the first half of 2018. In addition, based on strong well results from the 20 higher intensity completion wells placed on production in 2017 and 16 wells placed on production during the first quarter of 2018, the Company anticipates that it will likely add more higher intensity completions to its program during the second half of 2018.

The Company's capital spending for 2018 is expected to be weighted towards the first half of 2018 based on the 45 planned higher intensity completions, 3-D seismic surveys, pad construction, three deeper Wolfcamp D wells and a higher number of wells with longer laterals being placed on production during the first half of the year. First quarter spending was also impacted by carryover costs from 2017. In addition, with the steady increase in oil prices during the first part of the year, combined with high industry activity levels in the Permian Basin, the Company is seeing early signs of inflation, especially in labor, fuel, mud, chemicals, wireline and steel costs. Furthermore, the industry activity levels in the Permian Basin are also leading to a tight labor market for the Company's service providers, resulting in less experienced personnel performing services for the Company.

Based on the strong results to date from the higher intensity completions, it is likely that the Company will add more higher intensity completions during the second half of the year. The Company also is likely to add rigs later in the year to accomplish its 2019 growth plan. As a result of these two factors and the likelihood of additional inflation if oil prices and industry activity levels remain high, it is expected that the Company's 2018 capital budget of $2.9 billion will increase. The Company is still evaluating its plans and does not expect to be able to quantify the amount of this increase until mid-year. However, any budget increase is expected to be funded from the Company's forecasted cash flow for 2018, which is based on current NYMEX forward commodity prices.

During the first three months of 2018, the Company successfully completed 53 horizontal wells in the northern portion of the play and 17 horizontal wells in the southern portion of the play. In the northern portion of the play, approximately 60 percent of wells placed on production were Wolfcamp B interval wells, approximately 30 percent were Wolfcamp A interval wells and the remaining 10 percent were were primarily Lower Spraberry Shale wells. In the southern portion of the play, approximately 55 percent of the wells placed on production were Wolfcamp B interval wells and approximately 45 percent were Wolfcamp A interval wells.

The Company continues to utilize its integrated services to control well costs and operating costs and to support the execution of its drilling and production activities in the Spraberry/Wolfcamp field. During the three months ended March 31, 2018 , the Company utilized six of its eight Company-owned fracture stimulation fleets to support its drilling operations in the Spraberry/Wolfcamp field. The Company also owns other field service equipment that supports its drilling and production operations, including pulling units, fracture stimulation tanks, water transport trucks, hot oilers, blowout preventers, construction equipment and fishing tools. During 2018, the Company expects to spend $78 million for upgrades and maintenance to its pressure pumping and well service equipment.

The Company's sand mine in Brady, Texas, which is strategically located within close proximity (approximately 190 miles) of the Spraberry/Wolfcamp field, provides a secure sand source for the Company's horizontal drilling program. In addition, Pioneer has signed a contract for its initial offtake of sand sourced in West Texas where significant new sand supplies are expected to be available in 2018. The Company is evaluating additional contracts for lower cost sand sourced in West Texas.

The Company continues to pursue initiatives to improve drilling and completion efficiencies and reduce costs. The Company's long-term growth plan also continues to focus on optimizing the development of the field and addressing the future requirements for water sourcing and disposal, field infrastructure, gas processing, pipeline takeaway capacity for its products, oilfield services, tubulars, electricity, buildings and roads.

The Company is constructing a field-wide water distribution system to reduce the cost of water for drilling and completion activities and to secure adequate supplies of non-potable water to support the Company's long-term growth plan for the Spraberry/Wolfcamp field. Over the past few years, the Company has expanded its mainline system, subsystems and frac ponds to efficiently deliver water to many of Pioneer's drilling locations. The Company is purchasing approximately 120 thousand barrels per day of effluent water from the City of Odessa and has signed an agreement with the city of Midland to upgrade the city's wastewater treatment plant in return for a dedicated long-term supply of water from the plant. Once the Midland plant upgrade is complete, the Company expects to receive approximately two billion barrels of low-cost, non-potable water over a 28-year contract period (up to 240 thousand barrels per day) to support its completion operations. During 2018, the Company expects to spend approximately $135 million to begin the Midland plant upgrade construction and build additional subsystems, frac ponds and produced water reuse facilities.

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The Company has entered into firm pipeline commitments to deliver approximately 160 thousand barrels per day (MBOPD), or approximately 95 percent of its current Permian Basin net oil production, to Gulf Coast refineries and export markets. The Company delivered 160 MBOPD to the Gulf Coast during the first quarter, of which 87 MBOPD were exported. These firm pipeline contracts insulate Pioneer from the recent widening of the Midland-Cushing oil price basis differential by providing exposure to Brent-related pricing. As a result of this pricing benefit, Gulf Coast refinery and export sales added $16 million of incremental cash flow in the first quarter of 2018. Pioneer’s oil volumes under firm transportation contracts increase through 2021 commensurate with the Company’s forecasted Permian Basin oil production growth. The Company is targeting to transport greater than 90 percent of the Company’s long-term Permian Basin net oil production under firm pipeline transportation agreements to the Gulf Coast for refinery sales and exports. The Company expects exports in the second quarter of 2018 to be similar to the first quarter. During the second half of 2018, export volumes are expected to grow as Pioneer’s export capacity is increased from approximately 110 MBOPD to 150 MBOPD.

The Company also remains well positioned to move its Permian Basin gas production. Approximately 75 percent of Pioneer’s Midland Basin gas production is transported under firm pipeline transportation agreements to the southern California market where it is sold. The remainder is primarily sold under term contracts in the Waha market. Additional firm pipeline transportation has been secured on a third-party pipeline to the Gulf Coast, which is anticipated to be placed into service late in the third quarter of 2019. Firm transportation on the pipeline will provide access to LNG exports, refineries, petrochemical facilities and Mexican markets.

Asset Divestitures.

•

South Texas area. In February 2018, the Company announced its intention to divest its properties in South Texas. In March 2018, the Company entered into a purchase and sale agreement with an unaffiliated third party to sell approximately 10,200 net acres in the western portion of the Eagle Ford Shale ("West Eagle Ford Shale"), with first quarter 2018 production of 898 BOEPD, for cash proceeds of approximately $103 million . The Company has classified the West Eagle Ford Shale assets and liabilities as held for sale in the accompanying consolidated balance sheet as of March 31, 2018 . The sale closed in April 2018. See Notes 3 and 16 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information about the Company's sale of its West Eagle Ford Shale assets.

After the sale, the Company's position in the Eagle Ford Shale is approximately 59,000 net acres, all of which is held by production. The Company has opened a data room for its remaining Eagle Ford Shale assets and expects bids in mid-May 2018. A data room for the Company's remaining South Texas assets is expected to open during the second quarter of 2018. No assurance can be given that the sales will be completed in accordance with the Company's plan or on terms and at prices acceptable to the Company.


•	Raton and West Panhandle areas. The Raton sales process is underway and the Company expects to open a data room for its West Panhandle area assets during the second quarter of 2018. No assurance can be given that these sales will be completed in accordance with the Company's plan or on terms and at prices acceptable to the Company.

Results of Operations

Oil and gas revenues. Oil and gas revenues totaled $1.3 billion for the three months ended March 31, 2018 , as compared to $809 million for the same period in 2017 .

The increase in oil and gas revenues during the three months ended March 31, 2018 , as compared to the same period in 2017 , is primarily due to increases of 26 percent and 44 percent in oil and NGL prices, respectively, and increases of 25 percent , 41 percent and 12 percent in daily oil, NGL and gas sales volumes, respectively, partially offset by a 7 percent decrease in gas prices during the three months ended March 31, 2018 , as compared to the same period in 2017 . Realized prices are inclusive of the effect of the adoption of ASC 606 as described above in Adoption of New Accounting Standards.

The following table provides average daily sales volumes for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018	2017
Oil (Bbls)	182,519	145,619
NGLs (Bbls)	66,181	46,828
Gas (Mcf)	378,869	338,602
Total (BOEs)	311,845	248,881

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PIONEER NATURAL RESOURCES COMPANY

Average daily BOE sales volumes increase d by 25 percent for the three months ended March 31, 2018 , respectively, as compared to the same period in 2017 , principally due to the Company's successful Spraberry/Wolfcamp horizontal drilling program.

The oil, NGL and gas prices that the Company reports are based on the market prices received for each commodity. The following table provides the Company's average prices for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018		2017
Oil (per Bbl)	$	61.64	$	49.05
NGL (per Bbl)	$	27.74	$	19.33
Gas (per Mcf)	$	2.59	$	2.79
Total (per BOE)	$	45.11	$	36.14

Sales of purchased oil and gas. The Company periodically enters into pipeline capacity commitments in order to secure available oil, NGL and gas transportation capacity from the Company's areas of production. The Company enters into purchase transactions with third parties and separate sale transactions with third parties to diversify a portion of the Company's WTI oil sales to the Gulf Coast refinery or international export markets and to satisfy unused pipeline capacity commitments. Revenues and expenses from these transactions are presented on a gross basis as the Company acts as a principal in the transaction by assuming both the risk and rewards of ownership, including credit risk, of the commodities purchased and the responsibility to deliver the commodities sold. The transportation costs associated with these transactions are presented as a component of purchased oil and gas expense. The net effect of third party purchases and sales of oil and gas for the three months ended March 31, 2018 was income of $16 million , as compared to a loss of $19 million for the same period in 2017 . Firm transportation payments on excess pipeline capacity commitments are included in other expense in the accompanying consolidated statements of operations. See Note 13 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information on transportation commitment charges.

Interest and other income . The Company's interest and other income for the three months ended March 31, 2018 was $18 million , as compared to $13 million for the same period in 2017 . The increase in interest and other income during the three months ended March 31, 2018 , as compared to the same period in 2017 , was primarily due to increases of (i) $3 million in seismic data sales and (ii) $2 million in deferred compensation plan income. See Note 12 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information about the Company's interest and other income.

Derivative gains (losses), net. The Company utilizes commodity swap contracts, collar contracts and collar contracts with short puts to (i) reduce the effect of price volatility on the commodities the Company produces and sells or consumes, (ii) support the Company's annual capital budgeting and expenditure plans and (iii) reduce commodity price risk associated with certain capital projects. During the three months ended March 31, 2018 , the Company recorded $208 million of net derivative losses on commodity price and marketing derivatives, of which $72 million represented net cash payments. During the three months ended March 31, 2017 , the Company recorded $151 million of net derivative gains on commodity and diesel price derivatives, of which $10 million represented net cash receipts.

The following tables detail the net cash receipts (payments) on the Company's commodity derivatives and the relative price impact (per Bbl or Mcf) for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31, 2018
	Net cash receipts (payments)			Price impact
	(in millions)
Oil derivative payments	$	(74	)	$	(4.49	)	per Bbl
NGL derivative receipts	—			$	0.08		per Bbl
Gas derivative receipts	2			$	0.05		per Mcf
Total net commodity derivative payments	$	(72	)

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	Three Months Ended March 31, 2017
	Net cash receipts (payments)			Price impact
	(in millions)
Oil derivative receipts	$	11		$	0.84		per Bbl
NGL derivative receipts	—			$	0.04		per Bbl
Gas derivative payments	(1		)	$	(0.03	)	per Mcf
Total net commodity derivative receipts	$	10

The Company's open derivative contracts are subject to continuing market risk. See Note 5 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" and "Item 3. Quantitative and Qualitative Disclosures About Market Risk" for additional information regarding the Company's derivative contracts.

Gain on disposition of assets, net. The Company recorded a net gain on the disposition of assets of $4 million for the three months ended March 31, 2018 , as compared to $11 million for the same period in 2017 . See Note 3 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information regarding the Company's plan to sell its South Texas, Raton and West Panhandle assets and the Company's gain on disposition of assets for the three months ended March 31, 2017.

Oil and gas production costs. The Company recognized oil and gas production costs of $213 million during the three months ended March 31, 2018 , as compared to $141 million during the same period in 2017 . Gathering, processing and transportation charges are inclusive of the effect of the adoption of ASC 606 as described above in Adoption of New Accounting Standards. Lease operating expenses and workover expenses represent the components of oil and gas production costs over which the Company has management control.

The following table provides the components of the Company's total production costs per BOE for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018			2017
Lease operating expenses	$	4.41		$	4.99
Gathering, processing and transportation charges	2.47			1.01
Net natural gas plant (income) charges	(0.10		)	(0.28		)
Workover costs	0.82			0.59
Total production costs	$	7.60		$	6.31

Total oil and gas production costs per BOE for the three months ended March 31, 2018 increase d by 20 percent , as compared to the same period in 2017 . The decrease in lease operating expenses per BOE during the three months ended March 31, 2018, as compared to the same period in 2017, was primarily due to a greater proportion of the Company's production coming from horizontal wells in Spraberry/Wolfcamp area that have lower per BOE lease operating costs. Gathering, processing and transportation charges include transportation costs paid to third-party carriers and costs associated with gas processing. The adoption of ASC 606 had the effect of increasing gathering, processing and transportation charges by $1.53 per BOE during the three months ended March 31, 2018 over what would have been reported if these charges were accounted for under ASC 605. The decrease in net natural gas plant income per BOE is primarily reflective of reduced net revenues earned from gathering and processing of third party gas in Company-owned facilities. The increase in workover costs per BOE during the three months ended March 31, 2018 , as compared to the same period in 2017 , was primarily due to an increase in Permian vertical well workover activity due to the improvement in commodity prices.

Production and ad valorem taxes. The Company's production and ad valorem taxes were $76 million during the three months ended March 31, 2018 , as compared to $47 million for the same period in 2017 . In general, production taxes and ad valorem taxes are directly related to commodity price changes; however, Texas ad valorem taxes are based upon prior year commodity prices, whereas production taxes are based upon current year commodity prices. The increase in production and ad valorem taxes per BOE for the three months ended March 31, 2018 , as compared to the same period in 2017 , is primarily due the increase in commodity prices during 2018 and, for ad valorem tax purposes, the higher valuation attributable to the Company's successful Spraberry/Wolfcamp horizontal drilling program during 2017 and 2018.

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The following table provides the Company's production and ad valorem taxes per BOE for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018		2017
Production taxes	$	2.01	$	1.59
Ad valorem taxes	0.69		0.52
Total production and ad valorem taxes	$	2.70	$	2.11

Depletion, depreciation and amortization expense. The Company's DD&A expense was $357 million ( $12.72 per BOE) for the three months ended March 31, 2018 , as compared to $337 million ( $15.04 per BOE) during the same period in 2017 . Depletion expense on oil and gas properties was $12.32 per BOE during the three months ended March 31, 2018 , as compared to $14.51 per BOE during the same period in 2017 .

Depletion expense on oil and gas properties per BOE for the three months ended March 31, 2018 decrease d 15 percent as compared to the same period in 2017 , primarily due to (i) additions to proved reserves attributable to the Company's successful Spraberry/Wolfcamp horizontal drilling program and (ii) commodity price increases and cost reduction initiatives, both of which had the effect of adding proved reserves by lengthening the economic lives of the Company's producing wells.

Impairment of oil and gas properties and other long-lived assets. The Company performs assessments of its long-lived assets to be held and used, including oil and gas properties, whenever events or circumstances indicate that the carrying value of those assets may not be recoverable. In order to perform these assessments, management uses various observable and unobservable inputs, including management's outlooks for (i) proved reserves and risk-adjusted probably and possible reserves, (ii) commodity prices, (iii) production costs, (iv) capital expenditures and (v) production. Management's long-term commodity price outlooks are developed based on third-party, longer-term commodity future price outlooks as of a measurement date ("Management's Price Outlooks").

As a result of the Company's impairment assessments, the Company recognized pretax, noncash impairment charges of $285 million to reduce the carrying values of the Raton field to its estimated fair value during the three months ended March 31, 2017.

It is reasonably possible that the Company's estimate of undiscounted future net cash flows may change in the future resulting in the need to impair the carrying values of its properties. The primary factors that may affect estimates of future cash flows are (i) future reserve adjustments, both positive and negative, to proved reserves and risk-adjusted probable and possible reserves, (ii) results of future drilling activities, (iii) changes in Management's Price Outlooks and (iv) increases or decreases in production and capital costs associated with these properties.

See Note 4 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information regarding the Company's proved oil and gas property impairment charges.

Exploration and abandonments expense. The following table provides the Company's geological and geophysical costs, exploratory dry holes expenses and lease abandonments and other exploration expenses for the three months ended March 31, 2018 and 2017 :



	Three Months Ended March 31,
	2018		2017
	(in millions)
Geological and geophysical	$	28	$	23
Exploratory well costs	4		10
Leasehold abandonments and other	3		—
	$	35	$	33

The geological and geophysical expenses for the three months ended March 31, 2018 and 2017 were primarily related to acquiring seismic surveys over a portion of the northern Spraberry/Wolfcamp area and geological and geophysical personnel costs.

During the three months ended March 31, 2018 , the Company drilled and evaluated 67 exploration/extension wells, 65 of which were successfully completed as discoveries. During the same period in 2017 , the Company drilled and evaluated 41 exploration/extension wells, 39 of which were successfully completed as discoveries.

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General and administrative expense. General and administrative expense for the three months ended March 31, 2018 was $90 million ( $3.22 per BOE), as compared to $84 million ( $3.74 per BOE) for the same period in 2017 . The increase in general and administrative costs during the three months ended March 31, 2018 , as compared to the same period in 2017 , was primarily due to an increase in contract labor associated with upgrading the Company's information technology systems. The decrease in general and administrative expense per BOE during the three months ended March 31, 2018 , as compared to the same period in 2017 , was primarily due to a 25 percent increase in sales volumes during the three months ended March 31, 2018 , as compared to the same period in 2017 .

Accretion of discount on asset retirement obligations. Accretion of discount on asset retirement obligations was $4 million for the three months ended March 31, 2018 , as compared to $5 million for the same period in 2017 . See Note 9 of Notes to Consolidated Financial Statements in "Item 1. Financial Statements" for information regarding the Company's asset retirement obligations.

Interest expense. Interest expense was $36 million for the three months ended March 31, 2018 , as compared to $46 million for the same period in 2017 . The decrease in interest expense during the three months ended March 31, 2018 , as compared to the same period in 2017 , was primarily due to the repayment of the Company's 6.65% Senior Notes, which matured in March 2017. The weighted average interest rate on the Company's indebtedness for the three months ended March 31, 2018 was 5.6 percent, as compared to 5.8 percent for the same period in 2017 . See Note 7 of Notes to Consolidated Financial Statements in "Item 1. Financial Statements" for additional information about the Company's long-term debt and interest expense.

Other expense. Other expense was $57 million for the three months ended March 31, 2018 , as compared to $60 million for the same period in 2017 . See Note 13 of Notes to Consolidated Financial Statements in "Item 1. Financial Statements" for additional information regarding the Company's other expenses.

Income tax benefit (provision). The Company recognized an income tax provision of $50 million for the three months ended March 31, 2018 , as compared to an income tax benefit of $31 million for the same period in 2017 . The Company's effective tax rate for the three months ended March 31, 2018 was 22 percent , as compared to 42 percent for the same period in 2017 . The U.S. statutory rate for the three months ended March 31, 2018 was 21 percent , reflecting the reduction in the federal corporate income tax rate from 35 percent to 21 percent beginning in 2018 as a result of the Tax Cuts and Jobs Act that was enacted in December 2017. The Company's effective tax rate for the three months ended March 31, 2017 differs from the U.S. statutory rate in effect during 2017 of 35 percent primarily due to recognizing excess tax benefits of $8 million associated with the adoption of ASU 2016-09, "Improvements to Employee Share-Based Payment Accounting," which requires excess tax benefits or deficiencies associated with the vesting of long-term incentive awards to be recorded as income tax expense or benefit in the statement of operations rather than as an adjustment to additional paid-in capital in the balance sheet.

As of March 31, 2018 and December 31, 2017 , the Company had cumulative unrecognized tax benefits of $127 million and $124 million respectively, resulting from research and experimental expenditures related to horizontal drilling and completions innovations. If all or a portion of the unrecognized tax benefit is sustained upon examination by the taxing authorities, the tax benefit will be recognized as a reduction to the Company's deferred tax liability and will affect the Company's effective tax rate in the period it is recognized. The Company expects to substantially resolve the uncertainties associated with the unrecognized tax benefit by December 2018 .

See Note 14 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information regarding the Company's income tax rates and tax attributes.

Liquidity and Capital Resources

Liquidity. The Company's primary sources of short-term liquidity are (i) cash and cash equivalents, (ii) net cash provided by operating activities, (iii) sales of short-term and long-term investments, (iv) proceeds from divestitures and (iv) unused borrowing capacity under its credit facility. Although the Company expects that these sources of funding will be adequate to fund its 2018 capital expenditures, dividend payments and provide adequate liquidity to fund other needs, including previously announced stock repurchases, no assurance can be given that such funding sources will be adequate to meet the Company's future needs.

The Company's primary needs for cash are for (i) capital expenditures, (ii) acquisitions of oil and gas properties, vertical integration assets and facilities, (iii) payments of contractual obligations, including debt maturities, (iv) dividends and share repurchases and (v) working capital obligations. Funding for these cash needs may be provided by any combination of the Company's sources of liquidity.

As of March 31, 2018 , the Company had cash on hand of $1.0 billion , short-term investments of $722 million and long-term investments of $93 million . The Company had no outstanding borrowings under its credit facility as of March 31, 2018 , leaving $1.5 billion of unused borrowing capacity, and was in compliance with all of its debt covenants.

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Capital resources. Cash flows from operating, investing and financing activities, as reflected in the accompanying consolidated statements of cash flows as of March 31, 2018 and 2017 , are summarized below.

Operating activities. Net cash provided by operating activities was $554 million during the three months ended March 31, 2018 , as compared to $364 million during the same period in 2017 . The increase in net cash provided by operating activities for the three months ended March 31, 2018 , as compared to the same period in 2017 , is primarily due to increases in the Company's oil and gas revenues for the three months ended March 31, 2018 as a result of increases in commodity prices and sales volumes, partially offset by increases in oil and gas production costs, production and ad valorem taxes, cash derivative payments and working capital.

Investing activities. Net cash used in investing activities was $404 million during the three months ended March 31, 2018 , as compared $298 million during same period in 2017 . The increase in net cash used in investing activities during the three months ended March 31, 2018 , as compared to the same period in 2017 , is primarily due to (i) an increase of $385 million in additions to oil and gas properties and (ii) a decrease of $74 million in proceeds from dispositions of assets, partially offset by (iii) an increase of $318 million in net proceeds from investments and (iv) a decrease of $35 million in additions to other assets and other property and equipment. During the three months ended March 31, 2018 , the Company's expenditures for investing activities were primarily funded by net cash provided by operating activities.

Financing activities. Net cash used in financing activities was $45 million during the three months ended March 31, 2018 , as compared to $521 million during the same period in 2017 . The decrease in net cash used in financing activities during the three months ended March 31, 2018 , as compared to the same period in 2017 , is primarily due to the repayment of $485 million associated with the Company's 6.65% Senior Notes that matured in March 2017. See Note 7 of Notes to Consolidated Financial Statements in "Item 1. Financial Statements" for additional information regarding the Company's repayment of the 6.65% Senior Notes.

As the Company pursues its strategy, it may utilize various financing sources, including fixed and floating rate debt, convertible securities and preferred or common stock. The Company cannot predict the timing or ultimate outcome of any such actions, as they are subject to market conditions, among other factors. The Company may also issue securities in exchange for oil and gas properties, stock or other interests in other oil and gas companies or related assets. Additional securities may be of a class preferred to common stock, with respect to such matters as dividends and liquidation rights, and may also have other rights and preferences as determined by the Company's Board.

Capital commitments. During 2018, the Company plans to focus its capital spending primarily on oil drilling activities in the Spraberry/Wolfcamp area of the Permian Basin. The Company's current 2018 capital budget is $2.9 billion (excluding acquisitions, asset retirement obligations, capitalized interest, geological and geophysical administrative costs and information technology system upgrades), consisting of $2.6 billion for drilling and completion related activities, including additional tank batteries, saltwater disposal facilities and gas processing facilities, and $260 million for water infrastructure, vertical integration, field facilities and vehicles. The Company's capital expenditures during the three months ended March 31, 2018 were $879 million , consisting of $830 million for drilling operations (excluding acquisitions, asset retirement obligations, capitalized interest and geological and geophysical administrative costs) and $49 million for water infrastructure, vertical integration, system upgrades and other plant and equipment additions.

The Company expects to increase its 2018 capital program to reflect (i) additional higher intensity completions during the second half of 2018, (ii) potential drilling rig additions later in 2018 to support its 2019 growth plan and (iii) inflationary pressures associated with the current commodity price environment. It is too early to determine the amount of the increase to the Company's capital budget, but the Company believes that any increases will be funded from forecasted cash flow. See Operations and Drilling Highlights above for additional information regarding the Company's planned capital expenditures for 2018.

Based on results for the three months ended March 31, 2018 and the Company's current Management's Price Outlook, the Company expects that it will be able to fund its needs for cash (excluding acquisitions, if any), including the repayment of the May 2018 debt maturity and 2018 stock repurchases, with net cash flows from operating activities, cash and cash equivalents on hand, sales of short-term and long-term investments, proceeds from divestitures and, if necessary, availability under the Credit Facility; however, no assurances can be given that such funding will be adequate to meet the Company's future needs.

Dividends/distributions. During February of 2018 and 2017 , the Board declared semiannual dividends of $0.16 and $0.04 per common share, respectively. Future dividends are at the discretion of the Board, and, if declared, the Board may change the current dividend amount based on the Company's liquidity and capital resources at the time.

Contractual obligations. The Company's contractual obligations include long-term debt, operating leases, drilling commitments (primarily related to commitments to pay day rates for contracted drilling rigs), capital funding obligations, derivative obligations, minimum annual gathering, processing and transportation commitments, other liabilities (including postretirement

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benefit obligations) and firm transportation and fractionation commitments. Other joint interest owners in properties operated by the Company will incur portions of the costs represented by these commitments.

Firm purchase, gathering, transportation and fractionation commitments represent take-or-pay agreements, which include (i) contractual commitments to purchase sand and water for use in the Company's drilling operations and (ii) estimated fees on production throughput commitments and demand fees associated with volume delivery obligations from projected production of available reserves; consequently, the Company plans to purchase third party volumes to satisfy its commitments if it is economic to do so; otherwise, it will pay demand fees for any commitment shortfalls.

Off-balance sheet arrangements. From time-to-time, the Company enters into arrangements and transactions that can give rise to material off-balance sheet obligations of the Company. As of March 31, 2018 , the material off-balance sheet arrangements and transactions that the Company had entered into included (i) operating lease agreements, (ii) drilling commitments, (iii) firm purchase, transportation and fractionation commitments, (iv) open purchase commitments and (v) contractual obligations for which the ultimate settlement amounts are not fixed and determinable. The contractual obligations for which the ultimate settlement amounts are not fixed and determinable include (i) derivative contracts that are sensitive to future changes in commodity prices or interest rates, (ii) gathering, processing (primarily treating and fractionation) and transportation commitments on uncertain volumes of future throughput, (iii) open delivery commitments and (iv) indemnification obligations following certain divestitures. Other than the off-balance sheet arrangements described above, the Company has no transactions, arrangements or other relationships with unconsolidated entities or other parties that are reasonably likely to materially affect the Company's liquidity or availability of or requirements for capital resources. The Company expects to enter into similar contractual arrangements in the future, including incremental derivative contracts and additional firm purchase and transportation arrangements, in order to support the Company's business plans. There were no material changes to the Company's contractual obligations during the three months ended March 31, 2018 .

See Note 10 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for additional information about the Company's Commitments and Contingencies.

The Company's commodity and interest rate derivative contracts are periodically measured and recorded at fair value and continue to be subject to market and credit risk. As of March 31, 2018 , these contracts represented net liabilities of $380 million . The ultimate settlement value of the Company's commodity derivatives will be dependent upon actual future commodity prices, which may differ materially from the inputs used to determine the derivatives' fair values as of March 31, 2018 .

See Note 5 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" and "Item 3. Quantitative and Qualitative Disclosures About Market Risk" for additional information about the Company's derivative instruments and market risk.

New Accounting Pronouncements

The effects of new accounting pronouncements are discussed in Note 2 and Note 11 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements."

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

The following quantitative and qualitative disclosures about market risk are supplementary to the quantitative and qualitative disclosures provided in the Company's Annual Report on Form 10-K for the year ended December 31, 2017 . As such, the information contained herein should be read in conjunction with the related disclosures in the Company's Annual Report on Form 10-K for the year ended December 31, 2017 .

The primary objective of the following information is to provide forward-looking quantitative and qualitative information about the Company's potential exposure to market risks. The term "market risks," insofar as it relates to currently anticipated transactions of the Company, refers to the risk of loss arising from changes in commodity prices and interest rates. These disclosures are not meant to be precise indicators of expected future losses, but rather indicators of reasonably possible losses. This forward-looking information provides indicators regarding how the Company views and manages ongoing market risk exposures. None of the Company's market risk sensitive instruments are entered into for speculative purposes.

The Company had no interest rate derivative activity during the three months ended March 31, 2018 . The following table reconciles the changes that occurred in the fair values of the Company's open commodity derivative contracts during the three months ended March 31, 2018 :



	Derivative Contract Net Assets (Liabilities)
	(in millions)
Fair value of contracts outstanding as of December 31, 2017	$	(244	)
Changes in contract fair value	(208		)
Contract maturity receipts	72
Fair value of contracts outstanding as of March 31, 2018	$	(380	)

Interest rate sensitivity. See Note 7 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" and Capital Commitments, Capital Resources and Liquidity included in "Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations" for information regarding the Company's outstanding debt and debt transactions.

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The following table provides information about financial instruments to which the Company was a party as of March 31, 2018 and that are sensitive to changes in interest rates. The table presents debt maturities by expected maturity dates, the weighted average interest rates expected to be paid on the debt given current contractual terms and market conditions and the aggregate estimated fair value of the Company's outstanding debt. For fixed rate debt, the weighted average interest rates represent the contractual fixed rates that the Company was obligated to periodically pay on the debt as of March 31, 2018 . Although the Company had no outstanding variable rate debt as of March 31, 2018 , the average variable contractual rates for its credit facility (that matures in August 2020) projected forward proportionate to the forward yield curve for LIBOR on May 1, 2018 is presented in the table below.



	Nine Months Ending December 31,			Year Ending December 31,																	Liability Fair Value at March 31,
	2018			2019			2020			2021			2022			Thereafter			Total		2018
	(dollars in millions)
Total Debt:
Fixed rate principal maturities (a)	$	450		$	—		$	450		$	500		$	600		$	750		$	2,750	$	2,874
Weighted average fixed interest rate	5.11		%	5.00		%	4.42		%	4.72		%	4.94		%	5.70		%
Average variable interest rate	3.76		%	4.15		%	4.30		%

____________________


(a)	Represents maturities of principal amounts, excluding debt issuance costs and debt issuance discounts.

Commodity derivative instruments and price sensitivity. The following table provides information about the Company's oil, NGL and gas derivative financial instruments that were sensitive to changes in oil, NGL and gas prices as of March 31, 2018 . Although mitigated by the Company's derivative activities, declines in oil, NGL and gas prices would reduce the Company's revenues.

The Company manages commodity price risk with derivative contracts, such as swap contracts, collar contracts and collar contracts with short put options. Swap contracts provide a fixed price for a notional amount of sales volumes. Collar contracts provide minimum ("floor" or "long put") and maximum ("ceiling") prices on a notional amount of sales volumes, thereby allowing some price participation if the relevant index price closes above the floor price. Collar contracts with short put options differ from other collar contracts by virtue of the short put option price, below which the Company's realized price will exceed the variable market prices by the long put-to-short put price differential.

See Notes 4 and 5 of Notes to Consolidated Financial Statements included in "Item 1. Financial Statements" for a description of the accounting procedures followed by the Company for its derivative financial instruments and for specific information regarding the terms of the Company's derivative financial instruments that are sensitive to changes in oil, NGL or gas prices.

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	2018						Year Ending December 31, 2019		Asset (Liability) Fair Value at March 31, 2018 (a)
	Second Quarter		Third Quarter		Fourth Quarter		Year Ending December 31, 2019		Asset (Liability) Fair Value at March 31, 2018 (a)
									(in millions)
Oil Derivatives:
Average daily notional Bbl volumes:
Collar contracts	3,000		3,000		3,000		—		$	(5	)
Weighted average ceiling price per Bbl	$	58.05	$	58.05	$	58.05	$	—
Weighted average floor price per Bbl	$	45.00	$	45.00	$	45.00	$	—
Collar contracts with short puts	149,000		154,000		159,000		65,000		$	(358	)
Weighted average ceiling price per Bbl	$	57.79	$	57.70	$	57.62	$	60.74
Weighted average floor price per Bbl	$	47.42	$	47.34	$	47.26	$	52.69
Weighted average short put price per Bbl	$	37.38	$	37.31	$	37.23	$	42.69
Average forward NYMEX oil prices (b)	$	67.25	$	66.77	$	65.27	$	61.33
NGL Derivatives:
Ethane basis swap contracts (MMBtu) (c)	6,920		6,920		6,920		6,920		$	1
Weighted average price differential per MMBtu	$	1.60	$	1.60	$	1.60	$	1.60
Average forward NYMEX gas prices (b)	$	2.80	$	2.83	$	2.90	$	2.74
Gas Derivatives:
Average daily notional MMBtu volumes:
Swap contracts	100,000		100,000		100,000		—		$	5
Weighted average fixed price per MMBtu	$	3.00	$	3.00	$	3.00	$	—
Collar contracts with short puts	50,000		50,000		50,000		—		$	1
Weighted average ceiling price per MMBtu	$	3.40	$	3.40	$	3.40	$	—
Weighted average floor price per MMBtu	$	2.75	$	2.75	$	2.75	$	—
Weighted average short put price per MMBtu	$	2.25	$	2.25	$	2.25	$	—
Average forward NYMEX gas prices (b)	$	2.80	$	2.83	$	2.90	$	—
Basis swap contracts (d):
Southern California index swap contracts (e)	40,000		80,000		66,522		84,932		$	(24	)
Weighted average fixed price per MMBtu	$	0.30	$	0.30	$	0.50	$	0.33
Average forward basis differential prices (f)	$	0.75	$	1.06	$	1.21	$	1.00

___________________

(a)

In accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 210-20 and ASC 815-10, the Company classifies the fair value amounts of derivative assets and liabilities executed under master netting arrangements as net derivative assets or net derivative liabilities, as the case may be. The net asset and liability amounts shown above have been provided on a commodity contract-type basis, which may differ from their master netting arrangements classifications.


(b)	The average forward NYMEX oil and gas prices are based on May 1, 2018 market quotes.


(c)	The ethane basis swap contracts reduce the price volatility of ethane forecasted for sale by the Company at Mont Belvieu, Texas-posted prices. The ethane basis swap contracts fix the basis differential on a HH MMBtu equivalent basis. The Company will receive the HH price plus the price differential on 6,920 MMBtu per day, which is equivalent to 2,500 Bbls per day of ethane.

(d)

Subsequent to March 31, 2018 , the Company entered into additional basis swap contracts that fix the basis differentials between the index price at which the Company sells its Permian Basin gas and the NYMEX HH index price used in swap contracts and collar contracts with short puts for (i) 20,000 MMBtu per day of July 2018 through September 2019 production with a price differential of $1.54 per MMBtu and (ii) 30,000 MMBtu per day of January 2019 through September 2019 production with a price differential of $1.47 per MMBtu.


(e)	The referenced swap contracts fix the basis differential between Permian Basin index prices and southern California index prices for Permian Basin gas forecasted for sale in southern California.


(f)	The average forward basis differential prices are based on May 1, 2018 market quotes for basis differentials between Permian Basin index prices and southern California index prices.

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Marketing derivatives. Periodically, the Company enters into buy and sell marketing arrangements to fulfill firm pipeline transportation commitments. Associated with these marketing arrangements, the Company may enter into index swap contracts that mitigate price risk. The following table provides information about the Company's marketing derivative financial instruments that were sensitive to changes in oil prices as of March 31, 2018 :



	2018				Asset (Liability) Fair Value at March 31, 2018 (a)
	Second Quarter		Third Quarter		Asset (Liability) Fair Value at March 31, 2018 (a)
					(in millions)
Oil Derivatives:
Average daily notional Bbl volumes:
Basis swap contracts
Louisiana Light Sweet index swap volume (b) (c)	10,000		6,739		$	—
Price differential ($/Bbl)	$	3.18	$	3.18
Average forward basis differential prices (d)	$	3.60	$	3.50
Magellan East Houston index swap volume (b)	8,659		2,022		$	—
Price differential ($/Bbl)	$	3.29	$	3.30
Average forward basis differential prices (d)	$	6.75	$	11.08

____________________

(a)

In accordance with FASB ASC 210-20 and ASC 815-10, the Company classifies the fair value amounts of derivative assets and liabilities executed under master netting arrangements as net derivative assets or net derivative liabilities, as the case may be. The net asset and liability amounts shown above have been provided on a commodity contract-type basis, which may differ from their master netting arrangements classifications.


(b)	The referenced basis swap contracts fix the basis differentials between NYMEX WTI and Louisiana Light Sweet ("LLS") or Magellan East Houston ("MEH") oil prices for Permian Basin oil forecasted for sale in the Gulf Coast region.


(c)	Subsequent to March 31, 2018 , the Company liquidated its Louisiana Light Sweet basis swap contracts for 10,000 Bbl per day of June 2018 through August 2018 transportation commitments for a nominal gain.


(d)	The average forward basis differential prices are based on May 1, 2018 market quotes for basis differentials between NYMEX WTI and LLS or MEH oil prices.

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Item 4. Controls and Procedures

Evaluation of disclosure controls and procedures. The Company's management, with the participation of its principal executive officer and principal financial officer, have evaluated, as required by Rule 13a-15(b) under the Securities Exchange Act of 1934 (the "Exchange Act"), the effectiveness of the Company's disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) as of the end of the period covered by this Report. Based on that evaluation, the principal executive officer and principal financial officer concluded that the Company's disclosure controls and procedures were effective, as of the end of the period covered by this Report, in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, including that such information is accumulated and communicated to the Company's management, including the principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure.

Changes in internal control over financial reporting. There have been no changes in the Company's internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the three months ended March 31, 2018 that have materially affected or are reasonably likely to materially affect the Company's internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

The Company is party to various proceedings and claims incidental to its business. While many of these matters involve inherent uncertainty, the Company believes that the amount of the liability, if any, ultimately incurred with respect to these proceedings and claims will not have a material adverse effect on the Company's consolidated financial position as a whole or on its liquidity, capital resources or future annual results of operations. See Note 10 of Notes to Consolidated Financial Statements included in "Part I, Item 1. Financial Statements" for additional information regarding legal proceedings involving the Company.

Item 1A . Risk Factors

In addition to the information set forth in this Report, the risks that are discussed in the Company's Annual Report on Form 10-K for the year ended December 31, 2017 , under the headings "Part I, Item 1. Business – Competition, Markets and Regulations," "Part I, Item 1A. Risk Factors" and "Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk" should be carefully considered as such risks could materially affect the Company's business, financial condition or future results. There has been no material change in the Company's risk factors from those described in the Annual Report on Form 10-K.

These risks are not the only risks facing the Company. Additional risks and uncertainties not currently known to the Company or that it currently deems to be immaterial also may have a material adverse effect on the Company's business, financial condition or future results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

The following table summarizes the Company's purchases of treasury stock under plans or programs during the three months ended March 31, 2018 :



Period	Total Number of Shares Purchased (a)	Average Price Paid per Share		Total Number of Shares Purchased As Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased under Plans or Programs (b)
January 2018	51,401	$	172.85	—	$	—
February 2018	108,812	$	177.79	—	$	100,000,000
March 2018	101,520	$	167.52	101,512	$	82,995,111
Total	261,733			101,512

____________________


(a)	Includes 51,401 shares, 108,812 shares and 8 shares purchased from employees during January, February and March 2018, respectively, in order for the employee to satisfy tax withholding payments related to share-based awards that vested during the period.


(b)	In February 2008, the Company's board of directors approved a common stock repurchase program to offset the impact of dilution associated with annual employee stock awards. The stock repurchase program allows for up to $100 million of common stock to be repurchased during 2018.

Item 4. Mine Safety Disclosures

The Company's sand mines are subject to regulation by the Federal Mine Safety and Health Administration under the Federal Mine Safety and Health Act of 1977, as amended by the Mine Improvement and New Emergency Response Act of 2006. Information concerning mine safety violations or other regulatory matters required by Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 104 of Regulation S-K is included in Exhibit 95.1 to this Report .

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Item 6. Exhibits

Exhibits



Exhibit Number		Description

3.1	(a) —	Amended and Restated Certificate of Incorporation of the Company, dated June 26, 1997, and Certificate of Amendment of the Amended and Restated Certificate of Incorporation, effective May 18, 2012

10.1		Change in Control Agreement dated February 27, 2018, between the Company and Timothy L. Dove, together with a schedule identifying other substantially identical agreements between the Company and each of the executive officers identified on the schedule and identifying the material differences between each of those agreements and the filed Change in Control Agreement (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, File No. 1-13245, filed with the SEC on March 5, 2018).

10.2	(a) —	Form of Performance Unit Award Agreement between the Company and Timothy L. Dove, with respect to awards made under the Company's 2006 Long-Term Incentive Plan, commencing in 2018, together with a schedule identifying other substantially identical agreements between the Company and each of its other executive officers and identifying the material differences between each of those agreements and the filed Performance Unit Award Agreement.

10.3	(a) —	Form of Restricted Stock Unit Agreement between the Company and Timothy L. Dove, with respect to annual awards made under the Company's 2006 Long-Term Incentive Plan, commencing in 2018, together with a schedule identifying other substantially identical agreements between the Company and each of its other executive officers who received this award and identifying the material differences between each of those agreements and the filed Restricted Stock Unit Agreement.

10.4	(a) —	Form of Restricted Stock Award Agreement between the Company and executive officers of the Company with respect to annual awards made under the Company's 2006 Long-Term Incentive Plan, commencing in 2018.

12.1	(a) —	Computation of Ratios of Earnings to Fixed Charges and Earnings to Fixed Charges and Preferred Stock Dividends.

31.1	(a) —	Chief Executive Officer certification under Section 302 of Sarbanes-Oxley Act of 2002.

31.2	(a) —	Chief Financial Officer certification under Section 302 of Sarbanes-Oxley Act of 2002.

32.1	(b) —	Chief Executive Officer certification under Section 906 of Sarbanes-Oxley Act of 2002.

32.2	(b) —	Chief Financial Officer certification under Section 906 of Sarbanes-Oxley Act of 2002.

95.1	(a) —	Mine Safety Disclosures.

101.INS	(a) —	XBRL Instance Document.

101.SCH	(a) —	XBRL Taxonomy Extension Schema.

101.CAL	(a) —	XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF	(a) —	XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB	(a) —	XBRL Taxonomy Extension Label Linkbase Document.

101.PRE	(a) —	XBRL Taxonomy Extension Presentation Linkbase Document.

_____________


(a)	Filed herewith.


(b)	Furnished herewith.

Table of Contents

PIONEER NATURAL RESOURCES COMPANY

SIGNATURES

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 hereto duly authorized.



	PIONEER NATURAL RESOURCES COMPANY

Date: May 4, 2018	By:	/s/ RICHARD P. DEALY
		Richard P. Dealy,
		Executive Vice President and Chief Financial Officer

Date: May 4, 2018	By:	/s/ MARGARET M. MONTEMAYOR
		Margaret M. Montemayor,
		Vice President and Chief Accounting Officer

EXHIBIT 3.1

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

PIONEER NATURAL RESOURCES COMPANY

Pioneer Natural Resources Company, a corporation organized and existing under the General Corporation Law of the State of Delaware (the “Corporation”), does hereby certify as follows:

1. The present name of the Corporation is Pioneer Natural Resources Company and the name under which the Corporation was originally incorporated is MXP Reincorporation Corp.

2. The date of filing of the original Certificate of Incorporation of the Corporation (the “Original Certificate”) with the Secretary of State of the State of Delaware is April 2, 1997.

3. This Amended and Restated Certificate of Incorporation of the Corporation (the “Amended and Restated Certificate”) was duly adopted in accordance with the provisions of Sections 242 and 245 of the General Corporation Law of the State of Delaware.

4. This Amended and Restated Certificate restates and integrates and amends the Original Certificate to read in its entirety as follows:

FIRST: The name of the corporation (the “Corporation”) is Pioneer Natural Resources Company.

SECOND: The registered office of the Corporation in the State of Delaware is located at Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County of New Castle. The name of the registered agent of the Corporation at that address is The Corporation Trust Company.

THIRD: The purpose for which the Corporation is organized is to engage in any and all lawful acts and activities for which corporations may be organized under the General Corporation Law of the State of Delaware (the “DGCL”) and the Corporation shall have the power to perform all lawful acts and activities.

FOURTH: The Corporation will have perpetual existence.

FIFTH: The total number of shares of stock that the Corporation shall have authority to issue is 600,000,000 shares of capital stock classified as (i) 500,000,000 shares of common stock, par value $.01 per share (“Common Stock”) and (ii) 100,000,000 shares of preferred stock, par value $.01 per share (“Preferred Stock”).

The designations and the powers, preferences, rights, qualifications, limitations, and restrictions of the Preferred Stock and Common Stock are as follows:

1. Provisions Relating to the Preferred Stock.

(a) The Preferred Stock may be issued from time to time in one or more series, the shares of each series to have any designations and powers, preferences, rights, qualifications, limitations and restrictions thereof, as are stated and expressed in this Article Fifth and in the

resolution or resolutions providing for the issue of such series adopted by the board of directors of the Corporation as hereafter prescribed (a “Preferred Stock Designation”).

(b) Authority is hereby expressly granted to and vested in the board of directors of the Corporation to authorize the issuance of the Preferred Stock from time to time in one or more series, and with respect to each series of the Preferred Stock, to fix and state by the resolution or resolutions from time to time adopted providing for the issuance thereof the following:

(i) whether or not the series is to have voting rights, full, special or limited, or is to be without voting rights, and whether or not such series is to be entitled to vote as a separate class either alone or together with the holders of one or more other classes or series of stock;

(ii) the number of shares to constitute the series and the designations thereof;

(iii) the preferences and relative, participating, optional, or other special rights, if any, and the qualifications, limitations or restrictions thereof, if any, with respect to any series;

(iv) whether or not the shares of any series shall be redeemable at the option of the Corporation or the holders thereof or upon the happening of any specified event, and, if redeemable, the redemption price or prices (which may be payable in the form of cash, notes, securities or other property), and the time or times at which and the terms and conditions upon which such shares shall be redeemable and the manner of redemption;

(v) whether or not the shares of a series shall be subject to the operation of retirement or sinking funds to be applied to the purchase or redemption of such shares for retirement, and, if such retirement or sinking fund or funds are to be established, the periodic amount thereof, and the terms and provisions relative to the operation thereof;

(vi) the dividend rate, whether dividends are payable in cash, stock of the Corporation or other property, the conditions upon which and the times when such dividends are payable, the preference to or the relation to the payment of dividends payable on any other class or classes or series of stock, whether or not such dividends shall be cumulative or noncumulative, and if cumulative, the date or dates from which such dividends shall accumulate;

(vii) the preferences, if any, and the amounts thereof which the holders of any series thereof shall be entitled to receive upon the voluntary or involuntary dissolution of, or upon any distribution of the assets of, the Corporation;

(viii) whether or not the shares of any series, at the option of the Corporation or the holder thereof or upon the happening of any specified event, shall be convertible into or exchangeable for the shares of any other class or classes or of any other series of the same or any other class or classes of stock, securities or other property of the Corporation and the conversion price or prices or ratio or ratios or the rate or rates at which such conversion or exchange may be made, with such adjustments, if any, as shall be stated and expressed or provided for in such resolution or resolutions; and

(ix) any other special rights and protective provisions with respect to any series as the board of directors of the Corporation may deem advisable.

(c) The shares of each series of the Preferred Stock may vary from the shares of any other series thereof in any or all of the foregoing respects and in any other manner. The board of directors of the Corporation may increase the number of shares of the Preferred Stock designated for any existing series by a resolution adding to such series authorized and unissued shares of the Preferred Stock not designated for any other series. Unless otherwise provided in the Preferred Stock Designation, the board of directors of the Corporation may decrease the number of shares of the Preferred Stock designated for any existing series by a resolution subtracting from such series authorized and unissued shares of the Preferred Stock designated for such existing series, and the shares so subtracted shall become authorized, unissued and undesignated shares of the Preferred Stock.

2. Provisions Relating to the Common Stock.

(a) The holders of shares of the Common Stock shall be entitled to vote upon all matters submitted to a vote of the common stockholders of the Corporation and shall be entitled to one vote for each share of the Common Stock held.

(b) Subject to the prior rights and preferences, if any, applicable to shares of the Preferred Stock or any class or series thereof, and subject to the right of participation, if any, of the holders of the Preferred Stock in any dividends, the holders of shares of the Common Stock shall be entitled to receive such dividends (payable in cash, stock or otherwise) as may be declared thereon by the board of directors at any time and from time to time out of any funds of the Corporation legally available therefor.

(c) In the event of any voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, after distribution in full of the preferential amounts, if any, to be distributed to the holders of shares of the Preferred Stock or any class or series thereof, and subject to the right of participation, if any, of the holders of the Preferred Stock in any dividends, the holders of shares of the Common Stock shall be entitled to receive all of the remaining assets of the Corporation available for distribution to its stockholders, ratably in proportion to the number of shares of the Common Stock held by them. A liquidation, dissolution or winding-up of the Corporation, as such terms are used in this Paragraph (c), shall not be deemed to be occasioned by or to include any consolidation or merger of the Corporation with or into any other corporation or corporations or other entity or a sale, lease, exchange or conveyance of all or a part of the assets of the Corporation.

3. General.

(a) Subject to the foregoing provisions of this Certificate of Incorporation, the Corporation may issue shares of its Preferred Stock and Common Stock from time to time for such consideration (not less than the par value thereof) as may be fixed by the board of directors of the Corporation, which is expressly authorized to fix the same in its absolute discretion subject to the foregoing conditions. Shares so issued for which the consideration shall have been paid or delivered to the Corporation shall be deemed fully paid stock and shall not be liable to any further call or assessment thereon, and the holders of such shares shall not be liable for any further payments in respect of such shares.

(b) The Corporation shall have authority to create and issue rights and options entitling their holders to purchase shares of the Corporation’s capital stock of any class or series or other securities of the Corporation, and such rights and options shall be evidenced by instrument(s) approved by the board of directors of the Corporation. The board of directors of the Corporation shall be empowered to set the exercise price, duration, times for exercise and other terms of such rights or options; provided, however, that the consideration to be received for any share of capital stock subject thereto shall not be less than the par value thereof.

(c) No stockholder of the Corporation shall by reason of his or her holding shares of any class of capital stock of the Corporation have any preemptive or preferential right to acquire or subscribe for any additional, unissued or treasury shares (whether now or hereafter acquired) of any class of capital stock of the Corporation now or hereafter to be authorized, or any notes, debentures, bonds or other securities convertible into or carrying any right, option or warrant to subscribe for or acquire shares of any class of capital stock of the Corporation now or hereafter to be authorized, whether or not the issuance of any such shares or such notes, debentures, bonds or other securities would adversely affect the dividends or voting or other rights of that stockholder.

(d) Cumulative voting of shares of any capital stock having voting rights is prohibited.

SIXTH: The number, classification, and terms of the board of directors of the Corporation and the procedures to elect directors, to remove directors, and to fill vacancies in the board of directors shall be as follows:

1. The number of directors that shall constitute the whole board of directors shall from time to time be fixed exclusively by the board of directors by a resolution adopted by a majority of the members of the board of directors serving at the time of that vote. In no event shall the number of directors that constitute the whole board of directors be fewer than three or more than twenty-one. No decrease in the number of directors shall have the effect of shortening the term of any incumbent director. Directors of the Corporation need not be elected by written ballot unless the bylaws of the Corporation otherwise provide.

2. The board of directors of the Corporation shall be divided into three classes designated Class I, Class II and Class III, respectively, and all as nearly equal in number as possible. The initial term of office of directors of Class I shall expire at the first annual meeting of stockholders of the Corporation in 1998, of Class II shall expire at the second annual meeting of stockholders of the Corporation, and of Class III shall expire at the third annual meeting of stockholders of the Corporation, and in all cases as to each director until his successor is elected and qualified or until his earlier death, resignation or removal. At each annual meeting of stockholders beginning with the annual meeting of stockholders in 1998, each director elected to succeed a director whose term is then expiring shall hold his office until the third annual meeting of stockholders after his election and until his successor is elected and qualified or until his earlier death, resignation or removal. If the number of directors that constitutes the whole board of directors is changed as permitted by this Article Sixth, the majority of the members of the board of directors serving at the time of the vote to make such change shall also fix and determine the number of directors comprising each class; provided, however, that any increase or decrease in the number of directors shall be apportioned among the classes as equally as possible.

4. No director of any class of directors of the Corporation shall be removed before the expiration of that director’s term of office except for cause and by an affirmative vote of the holders of not less than two-thirds in voting power of the outstanding shares entitled to vote thereon cast at the annual meeting of stockholders or at any special meeting of stockholders called for this purpose by a majority of the members of the board of directors serving at the time of that vote.

5. Notwithstanding the foregoing, the election, removal and the filling of vacancies with respect to directors elected separately by any series of Preferred Stock shall be governed by the terms of the Preferred Stock Designation establishing such series.

SEVENTH: All of the power of the Corporation, insofar as it may be lawfully vested by this Certificate of Incorporation in the board of directors, is hereby conferred upon the board of directors of the Corporation. In furtherance of and not in limitation of that power or the powers conferred by law, (1) a majority of whole board of directors shall have the power to adopt, amend, and repeal the bylaws of the Corporation; (2) the board of directors may designate and appoint from among its members one or more committees, and may designate one or more of its members as alternate members, who may, subject to any limitations imposed by the board of directors, replace absent or disqualified members at any meeting of such committee; (3) the stockholders of the Corporation shall have no power to appoint or remove directors as members of committees of the board of directors, nor to abrogate the power of the board of directors to establish any such committees or the power of any such committee to exercise the powers and authority of the board of directors; (4) the stockholders of the Corporation shall have no power to elect or remove officers of the Corporation nor to abrogate the power of the board of directors to elect and remove officers of the Corporation; and (5) notwithstanding any other provision of this Certificate of Incorporation or any provision of law that might otherwise permit a lesser or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the capital stock of the Corporation required by law or by this Certificate of Incorporation, the bylaws of the Corporation shall not be adopted, altered, amended or repealed by the stockholders of the Corporation except in accordance with the provisions of the bylaws and by the vote of the holders of not less than a majority in voting power of the outstanding shares of stock then entitled to vote upon the election of directors, voting together as a single class or such higher vote as is set forth in the bylaws. The bylaws of the Corporation shall not contain any provision inconsistent with this Certificate of Incorporation. Notwithstanding any other provisions of this

Certificate of Incorporation or any provision of law that might otherwise permit a lesser or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the capital stock of the Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of not less than two-thirds in voting power of the shares of the Corporation then entitled to be voted in an election of directors, voting together as a single class, shall be required to amend or repeal or to adopt any provision inconsistent with, this Article Seventh.

EIGHTH: No action required to be taken or that may be taken at any meeting of common stock holders of the Corporation may be taken without a meeting, and the power of common stockholders to consent in writing, without a meeting, to the taking of any action is specifically denied. Notwithstanding any other provisions of this Certificate of Incorporation or any provision of law that might otherwise permit a lesser or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the capital stock of the Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of not less than eighty percent in voting power of the shares of the Corporation then entitled to be voted in an election of directors, voting together as a single class, shall be required to amend or repeal or to adopt any provision inconsistent with, this Article Eighth.

NINTH: Special meetings of the common stockholders of the Corporation, and any proposals to be considered at such meetings, may be called and proposed exclusively by the board of directors, pursuant to a resolution approved by a majority of the members of the board of directors serving at the time of that vote, and no stockholder of the Corporation shall require the board of directors to call a special meeting of common stockholders or to propose business at a special meeting of common stockholders. No business proposed by a stockholder to be considered at an annual meeting of the common stockholders (including the nomination of any person to be elected as a director of the Corporation) shall be considered by the common stockholders at that meeting unless, no later than sixty days before the annual meeting of common stockholders or (if later) ten days after the first public notice of that meeting is sent to common stockholders, the Corporation receives from the stockholder proposing that business a written notice that sets forth (1) the nature of the proposed business with reasonable particularity, including the exact text of any proposal to be presented for adoption, and the reasons for conducting that business at the annual meeting; (2) with respect to each such stockholder, that stockholder’s name and address (as they appear on the records of the Corporation), business address and telephone number, residence address and telephone number, and the number of shares of each class and series of stock of the Corporation beneficially owned by that stockholder; (3) any interest of the stockholder in the proposed business; (4) the name or names of each person nominated by the stockholder to be elected or reelected as a director, if any; and (5) with respect to each nominee, that nominee’s name, business address and telephone number, and residence address and telephone number, the number of shares, if any, of each class and series of stock of the Corporation owned beneficially by that nominee, and all information relating to that nominee that is required to be disclosed in solicitations of proxies for elections of directors or is otherwise required, pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (or any provision of law subsequently replacing Regulation 14A), together with a notarized letter signed by the nominee stating his or her acceptance of the nomination by that stockholder, stating his or her intention to serve as director if elected, and consenting to being named as a nominee for director in any proxy statement relating to such election. The person presiding at the annual meeting shall determine whether business (including the nomination of any person as a director) has been properly brought before the meeting and, if the facts so warrant, shall not permit any business (or voting with respect to any particular nominee) to be transacted that has not been properly brought before the meeting. Notwithstanding any other provisions of this Certificate of Incorporation or any provision of law that might otherwise permit a lesser or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the capital stock of the Corporation

required by law or by this Certificate of Incorporation, the affirmative vote of the holders of not less than two-thirds in voting power of the shares of the Corporation then entitled to be voted in an election of directors, voting together as a single class, shall be required to amend or repeal or to adopt any provision inconsistent with, this Article Ninth.

TENTH: No contract or transaction between the Corporation and one or more of its directors, officers or stockholders or between the Corporation and any other person (as used herein “person” means a corporation, partnership, association, firm, trust, joint venture, political subdivision or instrumentality) or other organization in which one or more of its directors, officers or stockholders are directors, officers or stockholders, or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the board or committee which authorizes the contract or transaction, or solely because his, her or their votes are counted for such purpose, if: (1) the material facts as to his or her relationship or interest and as to the contract or transaction are disclosed or are known to the board of directors or the committee, and the board of directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (2) the material facts as to his or her relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (3) the contract or transaction is fair as to the Corporation as of the time it is authorized, approved or ratified by the board of directors, a committee thereof, or the stockholders. Interested directors may be counted in determining the presence of a quorum at a meeting of the board of directors or of a committee which authorizes the contract or transaction.

ELEVENTH:

1. In addition to any affirmative vote that may be required by law, the Certificate of Incorporation or the bylaws of the Corporation, and except as otherwise prohibited by law or expressly provided by Section 253 of the DGCL or expressly provided in paragraph 2 of this Article Eleventh:

(a) any merger, consolidation or share exchange of the Corporation or any subsidiary of the Corporation with (i) any Related Person or (ii) any other Person (whether or not itself a Related Person) which is, or after such merger, consolidation or share exchange would be, an Affiliate of a Related Person; or

(b) any sale, lease, exchange, mortgage, pledge, transfer or other disposition by the Corporation or any subsidiary of the Corporation to any Related Person or any Affiliate of any Related Person or by any Related Person or any Affiliate of any Related Person to the Corporation or any subsidiary of the Corporation, of any assets or properties having an aggregate Fair Market Value of $10,000,000 or more; or

(c) any issuance or transfer by the Corporation or any subsidiary of the Corporation of any securities of the Corporation or any subsidiary of the Corporation to any Related Person or any Affiliate of any Related Person (except (i) pursuant to the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into stock of the Corporation or any subsidiary of the Corporation which securities were acquired by the Related Person prior to becoming a Related Person, or (ii) pursuant to a dividend or distribution paid or made, or the exercise, exchange or conversion of securities exercisable for, exchangeable for or convertible into stock of the Corporation or subsidiary of the Corporation which security is distributed, pro

rata to all holders of a class or series of stock of the Corporation subsequent to the time the Related Person became such, and provided in the case of this clause (ii) that there is not any increase of more than 1% in the Related Person’s proportionate share of the stock of any class or series of the Corporation or of the Voting Stock of the Corporation); or

(d) any adoption of any plan or proposal by the Corporation for the liquidation or dissolution of the Corporation voluntarily caused or proposed by or on behalf of a Related Person or any Affiliate of any Related Person; or

(e) any reclassification of securities (including any reverse stock split) or recapitalization of the Corporation or any merger, consolidation or share exchange of the Corporation with any of its subsidiaries or any other transaction (whether or not with or into or otherwise involving a Related Person) which has the effect, either directly or indirectly, of increasing by more than 1% the proportionate share of the outstanding stock of any class or series or the securities convertible into stock of any class or series of the Corporation or any subsidiary of the Corporation which is Beneficially Owned by any Related Person or any Affiliate of any Related Person or otherwise increasing the voting power of the outstanding stock of the Corporation or any subsidiary of the Corporation possessed by any such Related Person or Affiliate; or

(f) any series or combination of transactions having, directly or indirectly, the same effect as any of the foregoing; or

(g) any agreement, contract or other arrangement providing, directly or indirectly, for any of the foregoing, shall require the affirmative vote of the holders of (x) not less than 80% in voting power of the then outstanding Voting Stock held by stockholders voting together as a single class and (y) not less than 66 2/3% in voting power of the then outstanding Voting Stock not Beneficially Owned, directly or indirectly, by any Related Person with respect to such Business Combination, voting together as a single class. Subject to the applicability of paragraph 2, such affirmative vote shall be required notwithstanding the fact that no vote may be required, or that a lesser percentage may be specified, by law, elsewhere in the Certificate of Incorporation, in the bylaws of the Corporation or in any agreement with any national securities exchange or otherwise.

2. The provisions of paragraph 1 shall not be applicable to any particular Business Combination, and such Business Combination shall require only such affirmative vote as is required by applicable law, any other provision of the Certificate of Incorporation other than this Article Eleventh, the bylaws of the Corporation and any agreement with a national securities exchange or otherwise, if all of the conditions specified in either of the following subparagraphs (a) and (b) are met:

(a) the cash, property, securities or other consideration to be received per share by holders of each and every outstanding class or series of shares of the Corporation in the Business Combination is, with respect to each such class or series, either (i) the same in form and amount per share as that paid by the Related Person in a tender offer in which such Related Person acquired at least 50% of the outstanding stock of such class or series and which was consummated not more than one year prior to the date of such Business Combination or (ii) not less in amount (as to cash) or Fair Market Value (as to consideration other than cash) as of the date of the determination of the Highest Per Share Price (as to property, securities or other consideration) than the Highest Per Share Price applicable to such class or series of shares;

provided; however that in the event of any Business Combination in which the Corporation survives, any shares retained by the holders thereof shall constitute consideration other than cash for purposes of this subparagraph (a); or

(b) at least a majority of the Continuing Directors shall have expressly approved such Business Combination either in advance of or subsequent to such Related Person’s having become a Related Person.

In the case of any Business Combination with a Related Person to which subparagraph (b) above does not apply, at least a majority of the Continuing Directors, promptly following the request of a Related Person, shall determine the Highest Per Share Price for each class or series of stock of the Corporation. Such determination shall be announced not less than five days prior to the meeting at which holders of shares vote on the Business Combination. Such determination shall be final, unless the Related Person becomes the Beneficial Owner of additional shares after the date of the earlier determination, in which case the Continuing Directors shall make a new determination as to the Highest Per Share Price for each class or series of shares prior to the consummation of the Business Combination.

A Related Person shall be deemed to have acquired a share at the time that such Related Person became the Beneficial Owner thereof. With respect to shares owned by Affiliates, Associates and other Persons whose ownership is attributable to a Related Person, if the price paid by such Related Person for such shares is not determinable by a majority of the Continuing Directors, the price so paid shall be deemed to be the higher of (i) the price paid upon the acquisition thereof by the Affiliate, Associate or other Person or (ii) the Share Price of the shares in question at the time when the Related Person became the Beneficial Owner thereof.

3. For purposes of this Article Eleventh:

(a) The term “Affiliate,” used to indicate a relationship to a specified Person, shall mean a Person that directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person.

(b) The term “Associate,” used to indicate a relationship with a specified Person, shall mean (i) any corporation, partnership or other organization (other than the Corporation or any wholly owned subsidiary of the Corporation) of which such specified Person is an officer or partner or is, directly or indirectly, the Beneficial Owner of 10% or more of any class of equity securities; (ii) any trust or other estate in which such specified Person has a beneficial interest of 10% or more or as to which such specified Person serves as trustee or in a similar fiduciary capacity; (iii) any Person who is a director or officer of such specified Person or any of its parents or subsidiaries (other than the Corporation or any wholly owned subsidiary of the Corporation); and (iv) any relative or spouse of such specified Person or of any of its Associates or any relative of any such spouse, who has the same home as such specified Person or such Associate.

(c) A Person shall be a “Beneficial Owner” of any shares of any class or series of capital stock of the Corporation (i) which such Person or any of its Affiliates or Associates beneficially owns, directly or indirectly; or (ii) which such Person or any of its Affiliates or Associates has, directly or indirectly, (A) the right or obligation to acquire (whether such right or obligation is exercisable immediately or only after the passage of time or the occurrence of any event), pursuant to any agreement, arrangement or understanding (whether or not in writing) or upon the exercise of conversion rights, exchange rights, warrants or options, or otherwise;

provided, however, that a Person shall not be deemed the beneficial owner of any stock tendered pursuant to a tender or exchange offer made by such Person or any of such Person’s Affiliates or Associates until such tendered stock is accepted for purchase or exchange, or (B) the right to vote or dispose of, including pursuant to any agreement, arrangement or understanding (whether or not in writing); provided, however, that a Person shall not be deemed the beneficial owner of any stock because of such Person’s right to vote such stock if the agreement, arrangement or understanding to vote such stock arises solely from a revocable proxy or consent given in response to a proxy or consent solicitation made to ten or more Persons pursuant to, and in accordance with, the applicable provisions of the General Rules and Regulations under the Exchange Act; or (iii) which is beneficially owned, directly or indirectly, by any other Person (or any Affiliate or Associate thereof) with which such Person or any of its Affiliates or Associates has any agreement, arrangement or understanding (whether or not in writing) for the purpose of acquiring, holding, voting or disposing of such stock; or (iv) of which such Person would be the Beneficial Owner pursuant to the terms of Rule 13d-3 of the General Rules and Regulations under Exchange Act, as in effect on June 26, 1997.

(d) The term “Business Combination” shall mean any transaction which is referred to in any one or more of clauses (a) through (g) of paragraph 1 of this Article Eleventh.

(e) The term “Continuing Director” shall mean, with respect to a Business Combination with a Related Person, any director of the Corporation (i) who is unaffiliated with the Related Person and (ii) who (A) became a director prior to the time that the Related Person became a Related Person or (B) was recommended or nominated to succeed a Continuing Director by a majority of all then Continuing Directors, acting separately or as a part of any action taken by the board of directors or any committee thereof. Without limiting the generality of the foregoing, a director shall be deemed to be affiliated with a Related Person if such director (i) is or at any previous time has been an officer, director, employee or general partner of such Related Person; (ii) is or at any previous time has been an Affiliate or Associate of such Related Person; (iii) is or at any previous time has been a relative or spouse of such Related Person or of any such officer, director, general partner, Affiliate or Associate; (iv) performs services for, or is a member, employee, greater than 5% stockholder or other equity owner of any organization (other than the Corporation and its subsidiaries) which performs services, for such Related Person or any Affiliate of such Related Person or is a relative or spouse of any such Person; or (v) was nominated for election as a director by such Related Person.

(f) The term “Fair Market Value” shall mean, in the case of securities, the average of the closing sale prices during the 30-day period immediately preceding the date in question of such security on the principal United States securities exchange registered under the Exchange Act on which such security is listed (or the composite tape therefor) or, if such securities are not listed on any such exchange, the average of the closing bid quotations with respect to such security during the 30-day period preceding the date in question on the Nasdaq National Market or any similar system then in use or, if no such quotations are available, the fair market value on the date in question of such security as determined in good faith by a majority of the Continuing Directors; and in the case of property other than cash or securities, the fair market value of such property on the date in question as determined in good faith by a majority of the Continuing Directors.

(g) The term “Highest Per Share Price” shall mean (i) as to any class or series of stock of which the Related Person Beneficially Owns 10% or more of the outstanding shares, the

highest price that can be determined to have been paid or agreed to be paid for any share or shares of that class or series by such Related Person in a transaction that either (A) resulted in such Related Person Beneficially Owning 10% or more thereof or (B) was effected at a time when such Related Person Beneficially Owned more than 10% thereof, (ii) as to any class or series of stock of which the Related Person Beneficially Owns shares, but not more than 10% of the outstanding shares, the highest price that can be determined to have been paid or agreed to be paid at any time by such Related Person for any share or shares of that class or series that are then Beneficially Owned by such Related Person or (iii) as to any other class or series of stock, the amount determined by a majority of the Continuing Directors, on whatever basis they believe is appropriate, to be the per share price equivalent of the highest price that can be determined to have been paid or agreed to be paid at any time by the Related Person for any other class or series of stock. In determining the Highest Per Share Price, all purchases by the Related Person shall be taken into account regardless of whether the shares were purchased before or after the Related Person became a Related Person and the Highest Per Share Price will be appropriately adjusted to take into account (W) distributions paid or payable in stock, (X) subdivisions of outstanding stock, (Y) combinations of shares of stock into a smaller number of shares and (Z) similar events.

(h) The term “Person” shall mean any individual, corporation, limited liability company, association, partnership, joint venture, trust, estate or other entity or organization.

(i) The term “Related Person” shall mean any Person (other than the Corporation or any subsidiary of the Corporation and other than any profit-sharing, employee ownership or other employee benefit plan of the Corporation or any subsidiary of the Corporation or any trustee of or fiduciary with respect to any such plan when acting in such capacity) who or which (i) is the Beneficial Owner of more than 10% of the aggregate voting power of all outstanding stock of the Corporation; or (ii) is an Affiliate of the Corporation and at any time within the two-year period immediately prior to the date in question was the Beneficial Owner of more than 10% of the aggregate voting power of all outstanding stock of the Corporation; or (iii) is an assignee of or has otherwise succeeded to any shares of stock of the Corporation which were at any time within the two-year period immediately prior to the date in question Beneficially Owned by any Related Person, if such assignment or succession shall have occurred in the course of a privately negotiated transaction rather than an open market transaction. For the purposes of determining whether a Person is a Related Person, the number of shares of any class or series deemed to outstanding shall include shares of such class or series of which the Person is deemed the Beneficial Owner, but shall not include any other shares which may be issuable pursuant to any agreement, arrangement or understanding, or upon exercise of conversion rights, exchange rights, warrants or options, otherwise.

(j) The term “Voting Stock” shall mean all outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors, considered for the purpose of this Article Eleventh as one class. If the Corporation has shares of Voting Stock entitled to more or less than one vote for any such share, each reference in this Article Eleventh to a proportion or percentage in voting power of Voting Stock shall be calculated by reference to the portion or percentage of votes entitled to be cast by the holders of such shares.

4. Nothing contained in this Article ELEVENTH shall be construed to relieve any Related Person from any fiduciary obligation imposed by law.

5. Notwithstanding any other provision of the Certificate of Incorporation (and notwithstanding that a lesser percentage may be specified by law), the affirmative vote of the holders of not less than 80% in voting power of the then outstanding Voting Stock held by stockholders, voting together as a single class, shall be required to amend or repeal or adopt any provisions inconsistent with, this Article Eleventh.

TWELFTH: The Corporation shall indemnify any person who was, is, or is threatened to be made a party to a proceeding (as hereinafter defined) by reason of the fact that he or she (1) is or was a director or officer of the Corporation or (2) while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, partner, venturer, proprietor, trustee, employee, agent or similar functionary of another foreign or domestic corporation, limited liability company, association, partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise, entity or organization, to the fullest extent permitted under the DGCL, as the same exists or may hereafter be amended. Such right shall be a contract right and as such shall run to the benefit of any director or officer who is elected and accepts the position of director or officer of the Corporation or elects to continue to serve as a director or officer of the Corporation while this Article Twelfth is in effect. Any repeal or amendment of this Article Twelfth shall be prospective only and shall not limit the rights of any such director or officer or the obligations of the Corporation with respect to any claim arising from or related to the services of such director or officer in any of the foregoing capacities prior to any such repeal or amendment to this Article Twelfth. Such right shall include the right to be paid by the Corporation expenses (including attorneys’ fees) incurred in defending any such proceeding in advance of its final disposition to the maximum extent permitted under the DGCL, as the same exists or may hereafter be amended. If a claim for indemnification or advancement of expenses hereunder is not paid in full by the Corporation within sixty days after a written claim has been received by the Corporation, the claimant may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim, and, if successful in whole or in part, the claimant shall also be entitled to be paid the expenses of prosecuting such claim. It shall be a defense to any such action that such indemnification is not permitted under the DGCL, but the burden of proving such defense shall be on the Corporation. Neither the failure of the Corporation (including its board of directors or any committee thereof, independent legal counsel or stockholders) to have made its determination prior to the commencement of such action that indemnification of the claimant is permissible in the circumstances nor an actual determination by the Corporation (including its board of directors or any committee thereof, independent legal counsel or stockholders) that such indemnification is not permissible shall be a defense to the action or create a presumption that such indemnification is not permissible. In the event of the death of any person having a right of indemnification under the foregoing provisions, such right shall inure to the benefit of his or her heirs, executors, administrators, and personal representatives. The rights conferred above shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, bylaw, resolution of stockholders or directors, agreement or otherwise.

The Corporation may additionally indemnify any employee or agent of the Corporation to the fullest extent permitted by law.

As used herein, the term “proceeding” means any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative or investigative, any appeal in such an action, suit or proceeding, and any inquiry or investigation that could lead to such an action, suit or proceeding.

THIRTEENTH: A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (1) for any breach of the directors duty of loyalty to the Corporation or its stockholders, (2) for acts or

omissions not in good faith or which involve intentional misconduct or knowing violation of law, (3) under Section 174 of the DGCL, as the same exists or as such provision may hereafter be amended, supplemented or replaced, or (4) for any transaction from which the director derived an improper personal benefit. Any repeal or amendment of this Article Thirteenth by the stockholders of the Corporation shall be prospective only, and shall not adversely affect any limitation on the personal liability of a director of the Corporation arising from an act or omission occurring prior to the time of such repeal or amendment. In addition to the circumstances in which a director of the Corporation is not personally liable as set forth in the foregoing provisions of this Article Thirteenth, a director shall not be liable to the Corporation or its stockholders to such further extent as permitted by any law hereafter enacted, including without limitation any subsequent amendment to the DGCL. Notwithstanding any other provisions of this Certificate of Incorporation or any provision of law that might otherwise permit a lesser or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the capital stock of the Corporation required by law or by this Certificate of Incorporation, the affirmative vote of the holders of not less than two-thirds in voting power of the shares of the Corporation then entitled to be voted in an election of directors, voting together as a single class, shall be required to amend or repeal or to adopt any provision inconsistent with, this Article Thirteenth.

IN WITNESS WHEREOF, Pioneer Natural Resources Company has caused this certificate to be executed by the undersigned this 24 ^th day of June, 1997.



PIONEER NATURAL RESOURCES COMPANY
By:		/s/ M. Garrett Smith
Name:		M. Garrett Smith
		Vice President

STATE OF DELAWARE

CERTIFICATE OF AMENDMENT

OF THE

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

PIONEER NATURAL RESOURCES COMPANY, a corporation organized and existing under and by virtue of the General Corporation Law of the State of Delaware

DOES HEREBY CERTIFY:

FIRST : That at a meeting of the Board of Directors of Pioneer Natural Resources Company, resolutions were adopted setting forth a proposed amendment of the Amended and Restated Certificate of Incorporation of said corporation, declaring said amendment to be advisable and that said amendment should be presented to the stockholders of said corporation at the 2012 Annual Meeting of Stockholders for approval thereof.

SECOND : That thereafter, pursuant to resolution of its Board of Directors, the proposed amendment was presented to the stockholders of said corporation at its 2012 Annual Meeting of Stockholders duly called and held on the 17th day of May 2012 in accordance with Section 222 of the General Corporation Law of the State of Delaware, at which meeting the necessary number of shares as required by statute were voted in favor of the amendment.

THIRD : That said amendment was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law of the State of Delaware.

FOURTH : That the resolution setting forth the proposed amendment is as follows:

RESOLVED, that the Amended and Restated Certificate of Incorporation of this corporation be amended by changing Article SIXTH thereof to read as follows:

2. Except as otherwise provided by this paragraph 2, until the election of directors at the annual meeting of stockholders in 2015, the board of directors of the Corporation shall be into three classes designated Class I, Class II and Class III, respectively, and all as nearly equal in number as possible. Each director who is serving as a director immediately following the 2012 annual meeting of stockholders, or is thereafter elected or appointed a director, shall hold office until the expiration of the term for which he or she has previously been elected or appointed, and until his or her successor shall be

duly elected and qualified, or until death, resignation or removal. At the 2013 annual meeting of stockholders, the successors of the class of directors whose terms expire at that meeting shall be elected for terms expiring at the 2014 annual meeting of stockholders. At the 2014 annual meeting of stockholders, the successors of the class of directors whose terms expire at that meeting shall be elected for terms expiring at the 2015 annual meeting of stockholders. At the 2015 annual meeting of stockholders, and at each annual meeting of stockholders thereafter, all directors shall be elected for terms expiring at the next annual meeting of stockholders. Until the election of directors at the annual meeting of stockholders in 2015, if the number of directors that constitutes the whole board of directors is changed as permitted by this Article Sixth, the majority of the members of the board of directors serving at the time of the vote to make such change shall also fix and determine the number of directors comprising each class.

3. Vacancies in the board of directors resulting from death, resignation, retirement, disqualification, removal from office or other cause and newly-created directorships resulting from any increase in the authorized number of directors shall be filled by a majority vote of the remaining directors then in office, though less than a quorum, or by the sole remaining director. Until the election of directors at the annual meeting of stockholders in 2015, each director chosen to fill a vacancy in the board of directors shall receive the classification of the vacant directorship to which he or she has been appointed or, if it is a newly created directorship, shall receive the classification that at least a majority of the board of directors designates and shall hold office until the first meeting of stockholders held after his or her appointment for the purpose of electing directors of that classification and until his or her successor is elected and qualified or until his or her earlier death, resignation or removal from office. From and after the annual meeting of stockholders in 2015, each director chosen to fill a vacancy in the board of directors shall hold office until the first meeting of stockholders held after his or her appointment for the purpose of electing directors and until his or her successor is elected and qualified or until his or her earlier death, resignation or removal from office.

4. Until the election of directors at the annual meeting of stockholders in 2015, no director of any class of directors of the Corporation shall be removed before the expiration of that director’s term of office except for cause and by an affirmative vote of the holders of not less than two-thirds in voting power of the outstanding shares entitled to vote thereon cast at the annual meeting of stockholders or at any special meeting of stockholders called for this purpose by a majority of the members of the board of directors serving at the time of that vote.

6. Notwithstanding any other provisions of this Certificate of Incorporation or any provision of law that might otherwise permit a lesser or no vote, but in addition to any affirmative vote of the holders of any particular class or series of the capital stock of the Corporation required by law or by this Certificate of Incorporation, until the election of directors at the annual meeting of stockholders in 2015, the affirmative vote of the holders of not less than two-thirds in voting power of the shares of the Corporation then entitled to be voted in an election of directors, voting together as a single class, shall be required to amend or repeal or to adopt any provision inconsistent with, this Article Sixth. From after the annual meeting of stockholders in 2015, the affirmative vote of the holders of not less than a majority in voting power of the shares of the Corporation then entitled to be voted in an election of directors, voting together as a single class, shall be required to amend or repeal or to adopt any provision inconsistent with, this Article Sixth.

IN WITNESS WHEREOF, Pioneer Natural Resources Company has caused this Certificate of Amendment to be signed by its Executive Vice President and General Counsel and attested by its Corporate Secretary, this 18th day of May, 2012.



PIONEER NATURAL RESOURCES USA, INC.

By:		/s/ Mark S. Berg
		Mark S. Berg, Executive Vice President and
		General Counsel



ATTEST:

/s/ Mark H. Kleinman
Mark H. Kleinman, Corporate Secretary

Exhibit 10.2

PERFORMANCE UNIT AWARD AGREEMENT

PIONEER NATURAL RESOURCES COMPANY

AMENDED AND RESTATED 2006 LONG TERM INCENTIVE PLAN

[Date]

To: Timothy L. Dove

Pioneer Natural Resources Company, a Delaware corporation (the " Company "), is pleased to grant you an award (this " Award ") to receive an aggregate of _________ performance units (each, a “ Performance Unit ”) in respect of the period January 1, ______ through December 31, ______ (the “ Performance Period ”). This Award is subject to your acceptance of and agreement to all the applicable terms, conditions and restrictions described in this Performance Unit Award Agreement (the “ Agreement ”) and the Pioneer Natural Resources Company Amended and Restated 2006 Long Term Incentive Plan (as it may be amended from time to time, the “ Plan ”). A copy of the Plan is available upon request. Except as provided below, to the extent that any provision of this Agreement conflicts with the expressly applicable terms of the Plan, you acknowledge and agree that those terms of the Plan shall control and, if necessary, the applicable provisions of this Agreement shall be deemed amended so as to carry out the purpose and intent of the Plan. Terms that have their initial letters capitalized, but that are not otherwise defined in this Agreement, shall have the meanings given to them in the Plan in effect as of the date of this Agreement. The Performance Units contemplated herein are described in the Plan as Restricted Stock Units subject to restrictions that lapse based on the achievement of performance goals pursuant to Section 6(a)(i) of the Plan.

This Agreement sets forth the terms of the agreement between you and the Company with respect to the Performance Units. By accepting this Agreement, you agree to be bound by all of the terms hereof.


1.	Overview of Performance Units.

(a) Performance Units Generally . Each Performance Unit represents a contractual right to receive one share of the Company’s common stock (the “ Common Stock ”), subject to the terms and conditions of this Agreement; provided that, based on the relative achievement against each Performance Objective (as defined below), the number of shares of Common Stock that may be deliverable hereunder in respect of the Performance Units may range from 0% to 250% of the number of Performance Units stated in the preamble to this Agreement (such stated number of Performance Units hereafter called the “ Initial Performance Units ”). Your right to receive Common Stock in respect of Performance Units is generally contingent, in whole or in part, upon (i) the achievement of the performance objective outlined in Section 2 below (the

“ Performance Objective ”) and (ii) except as provided in Section 4 or Section 5, your continued employment with the Company or one of its Subsidiaries through the end of the Performance Period.

(b) Dividend Equivalents . With respect to each outstanding Performance Unit, the Company shall credit a book entry account with an amount equal to the amount of any cash dividend paid on one share of Common Stock. The amount credited to such book entry account shall be payable to you at the same time or times, and subject to the same terms and conditions as are applicable to, your Performance Units or Restricted Stock Units granted pursuant to Section 5, as applicable; provided that, if more than the Initial Performance Units shall become payable in accordance with this Agreement, the maximum amount payable in respect of such dividend equivalents shall be the amount credited to your book entry account. Dividends and distributions payable on Common Stock other than in cash will be addressed in accordance with Section 8 hereof.

2. Total Shareholder Return Objective . The Performance Objective with respect to the Initial Performance Units is based on Total Shareholder Return. Total Shareholder Return shall mean, as to the Company and each of the Peer Companies (as defined below), the annualized rate of return shareholders receive through stock price changes and the assumed reinvestment of dividends paid over the Performance Period. Dividends per share paid other than in the form of cash shall have a value equal to the amount of such dividends reported by the issuer to its shareholders for purposes of Federal income taxation. For purposes of determining the Total Shareholder Return for the Company and each of the Peer Companies, the change in the price of the Company’s Common Stock and of the common stock of each Peer Company, as the case may be, shall be based upon the average of the closing stock prices of the Company and such Peer Company on each trading day in the 60-day period preceding each of the start (the “ Initial Value ”) and the end (the “ Closing Value ”) of the Performance Period. The Initial Value of the Common Stock to be used to determine Total Shareholder Return over the Performance Period is ______ per share. Achievement with respect to this Performance Objective shall be determined based on the Company’s relative ranking in respect of the Performance Period with regard to Total Shareholder Return as compared to Total Shareholder Return of the Peer Companies, and shall be determined in accordance with the applicable table as set forth in Appendix A hereto. The applicable table shall be determined based on the number of Peer Companies for the Performance Period. A company shall be a “ Peer Company ” if it (i) is one of the companies listed on Appendix A hereto and (ii) has a class of common equity securities listed to trade on a U.S. national securities exchange and registered under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “ 1934 Act ”), during each day of the Performance Period; provided that, if a Peer Company ceases to be a publicly traded company at any time during the Performance Period due to or following bankruptcy, such company shall remain a Peer Company but shall be deemed to have a Total Shareholder Return of negative 100% (-100%). The number of Performance Units, if any, determined to be earned pursuant to the applicable table under Appendix A, as modified pursuant to Section 4(a), Section 4(b) or Section 5, if applicable, shall be referred to “ Earned Performance Units ”.

the year in which the Performance Period ends (determined without regard to the occurrence of the Change in Control with respect to Section 5), but not later than March 1 of such year. Unless otherwise determined by the Committee, all payments in respect of Earned Performance Units (or Restricted Stock Units) shall be made in freely transferable shares of Common Stock; provided, however, that if and to the extent that the reservation of the power to settle (as opposed to the act of settling) Performance Units (or Restricted Stock Units) in cash instead of shares would result in an additional financial accounting charge for the Company, the Committee shall not have the right to settle such Performance Units (or Restricted Stock Units) other than in the form of Common Stock (or, if applicable, stock of a Successor Corporation (as defined in Section 5)). Neither this Section 3 nor any action taken pursuant to or in accordance with this Section 3 shall be construed to create a trust of any kind. Any shares of Common Stock issued to you pursuant to this Agreement in settlement of Earned Performance Units (or Restricted Stock Units) shall be in book entry form registered in your name. Any fractional Earned Performance Units (or Restricted Stock Units) shall be rounded up to the nearest whole share of Common Stock.


4.	Termination of Employment .

(a) Disability . In the event that your employment with the Company or a Subsidiary terminates during the Performance Period due to your Disability (as such term is defined in the Termination Agreement (as defined below)), you shall be deemed to have Earned Performance Units equal to the product of (i) and (ii), where (i) and (ii) are:

(i) (x) if you would attain age 60 on or prior to December 31, ______ (a “ Section 409A Participant ”), the number of Earned Performance Units that you would have earned in accordance with Section 2 had you remained employed through the end of the Performance Period and (y) if you are not a Section 409A Participant, the Initial Performance Units;

(ii) a fraction (the “ Pro-Ration Fraction ”), (A) the numerator of which is the number of full months (counting the month in which your termination of employment occurs as a full month) during the Performance Period during which you were employed and (B) the denominator of which is 36.

If you are not a Section 409A Participant, distribution of shares of Common Stock in respect of the Performance Units determined to be earned by reason of this Section 4(a) shall be made not later than 74 days following your Disability and shall be in full and complete satisfaction of all of your rights (and the rights of any person who derives his, her or its rights from you) under this Agreement. If you are a Section 409A Participant, distribution of shares of Common Stock in respect of the Performance Units determined to be earned by reason of this Section 4(a) shall be made in the year following the year in which the Performance Period ends (determined without regard to the occurrence of the Change in Control with respect to Section 5), but not later than March 1 of such year. For purposes of this Agreement, “ Disability ” shall have the meaning given such term in the Termination Agreement; provided, however, that if there is no such agreement at the time of such termination, the term, “Disability,” shall mean (i) a physical or mental impairment of sufficient severity that, in the opinion of the Company, (A) you are unable to continue performing the duties assigned to you prior to such impairment or (B) your condition entitles you to disability benefits

under any insurance or employee benefit plan of the Company or its Subsidiaries and (ii) the impairment or condition is cited by the Company as the reason for your termination; provided further, that in all cases, the term Disability shall be applied and interpreted in compliance with Section 409A of the Code and the regulations thereunder. For purposes of this Agreement, “ Termination Agreement ” means, prior to the occurrence of a Change in Control, the Severance Agreement or other separate agreement between you and the Company and/or any of its subsidiaries relating to the provision of severance and other benefits before a Change in Control and, upon and following the occurrence of a Change in Control, the Change in Control Agreement or other separate agreement between you and the Company and/or any of its subsidiaries relating to the provision of severance and other benefits upon or after a Change in Control.

(b) Normal Retirement . In the event that your employment with the Company and each of its Subsidiaries by which you are employed terminates during the Performance Period due to your Normal Retirement (defined below), you shall be deemed to have Earned Performance Units, as of the end of the Performance Period, equal in number to the number of Earned Performance Units that you would have earned in accordance with Section 2 had you remained employed through the end of the Performance Period, and not be subject to the Pro-Ration Fraction, if (except as provided in Section 5(e)) the following conditions are met: (x) as of the date of the termination of your employment, the conditions set forth below in items (i)-(iv) are satisfied and (y) you intend to comply with the covenants contained in items (v) and (vi) (which intent shall be conclusively presumed unless, prior to or concurrently with the notice provided pursuant to item (ii) below, you notify the Company in writing, addressed to the Vice President and Chief Human Resources Officer (or his or her successor), that you do not intend to comply with such covenants).

(i) The date of the termination of your employment is at least one year after the date of this Agreement (but if not, you shall be deemed to have Earned Performance Units, as of the end of the Performance Period, equal in number to the product of (i) the number of Earned Performance Units that you would have earned in accordance with Section 2 had you remained employed through the end of the Performance Period multiplied by (ii) the Pro-Ration Fraction).

(ii) You gave advance written notice of your intent to terminate your employment due to Normal Retirement at least six months in advance of the date of termination to the Vice President and Chief Human Resources Officer (or his or her delegate), and to your direct manager, or in the case of the chief executive officer of the Company, to the Board (subject to the ability of the Company to waive such requirement, exercisable by the Vice President and Chief Human Resources Officer (or his or her delegate) or the Board, as applicable).

(iii) You have cooperated with the Company, to the satisfaction of the Company, in the training of a replacement during the period prior to the termination of employment.

(iv) If required by the Company, you execute and deliver to the Company an effective release of claims and other liability in a form acceptable to the Company.

(v) For two years following the termination of your employment, without the prior written consent of the chief executive officer of the Company, or in the event you are the chief executive officer of the Company on the date of termination of your employment, the consent of the Board or any Committee or director designated by the Board, you agree to refrain from becoming a director, partner, investor or employee of, or consultant to, any business that competes with the Company or any Subsidiary in the business of exploration or production of oil or natural gas, or related oilfield services, within the geographic area or areas in which the Company or any Subsidiary operates at the time of termination of employment or has operated in the immediately preceding one-year period (a “ Competitive Business ”); provided that, you will not be restricted from purchasing or holding for investment purposes less than 2% of the shares of any Competitive Business whose shares are regularly traded on a national securities exchange or inter-dealer quotation system. If the Company so requires prior to the date of termination of employment, the Company may require that you execute a separate agreement to effect the intent of the foregoing.

(vi) For two years following the termination of your employment, you agree to refrain from making, or causing or assisting any other person to make, any oral or written communication to any third party about the Company and/or any of the employees, officers or directors of the Company which impugns or attacks, or is otherwise critical of, the reputation, business or character of such entity or person; or that discloses private or confidential information about their business affairs; or that constitutes an intrusion into their seclusion or private lives; or that gives rise to unreasonable publicity about their private lives; or that places them in a false light before the public; or that constitutes a misappropriation of their name or likeness (the foregoing being subject to Section 12(g)). If the Company so requires prior to the date of termination of employment, the Company may require that you execute a separate agreement to effect the intent of the foregoing.

You expressly acknowledge and agree that the restrictions set forth in clauses (v) and (vi) of this this Section 4(b) are reasonable in all respects, necessary to protect the Company’s legitimate business interests and a material inducement for the Company to grant this Award to you and enter into this Agreement. In the event that, following your termination of employment, it is determined by a court of competent jurisdiction that you have not satisfied any of the conditions set forth in Section 4(b)(v) or (vi) in any material respect, then all of your Performance Units shall terminate and be cancelled. Notwithstanding the foregoing, in the event there occurs a Change in Control, whether prior to or after the end of the Performance Period or the distribution of shares of Common Stock in respect of the Performance Units, the restrictions set forth in clauses (v) and (vi) of this Section 4(b) shall automatically terminate and become void and of no effect.

For purposes of this Agreement, “ Normal Retirement ” shall mean the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed due to your retirement on or after the date that you attain age 60, provided that you have completed five Years of Service as of the date of such termination. For purposes of this Agreement, “ Years of Service ” means the total number of years that you have been employed by the Company or its Subsidiaries as determined in accordance with the Company’s policies as administered from time to time. For the avoidance of doubt, the Company’s determination of Years of Service shall be at the sole discretion of the Company, its policies may change from time to time, and its determination will be final and conclusive and binding on all Participants.

Any portion of the Performance Units that cannot become earned and payable in accordance with the first sentence of this Section 4(b) shall terminate and automatically be cancelled as of the date of your termination of employment. Any portion of your Performance Units that is eligible to be earned pursuant to the first sentence of this Section 4(b), but is not earned as of the end of the Performance Period, shall terminate and be cancelled upon the expiration of such Performance Period.

(c) Termination Without Cause or Termination For Good Reason . In the event that your employment with the Company and each of its Subsidiaries by which you are employed is terminated during the Performance Period (x) by the Company and such Subsidiaries and such termination is not a Termination for Cause or (y) by you and such termination is a Termination for Good Reason (as each such term is defined in the Termination Agreement), you shall be deemed to have earned, as of the end of the Performance Period, the number of Earned Performance Units that you would have earned in accordance with Section 2 had you remained employed through the end of the Performance Period. Any portion of your Performance Units that is eligible to be earned pursuant to the preceding sentence, but is not earned as of the end of the Performance Period, shall terminate and be cancelled upon the expiration of such Performance Period.

(d) Death . In the event that your employment with the Company or a Subsidiary terminates during the Performance Period due to your death, you shall be deemed to have Earned Performance Units equal to the product of (i) the Initial Performance Units and (ii) the Pro-Ration Fraction. Distribution of shares of Common Stock in respect of the Performance Units determined to be earned by reason of this Section 4(d) shall be made not later than 74 days following your death and shall be in full and complete satisfaction of all of your rights (and the rights of any person who derives his, her or its rights from you) under this Agreement.

(e) Other Termination of Employment . Unless otherwise determined by the Committee at or after grant, in the event that your employment with the Company or a Subsidiary terminates prior to the end of the Performance Period for any reason other than those listed in Section 4(a), 4(b), 4(c) or 4(d), all of your Performance Units shall terminate and automatically be cancelled upon such termination of employment.

specified above until the date that the Change in Control occurs (the “ Change in Control Date ”) or you are treated, for purposes of such CIC Agreement, to have remained in employment through the Change in Control Date, upon the occurrence of a Change in Control your rights in respect of the Performance Units shall be determined as provided in this Section 5. If your employment shall have terminated prior to the Change in Control Date, but at least some of your Performance Units remain outstanding pursuant to Section 4(b) or Section 4(c), your rights in respect of your outstanding Performance Units shall be determined as provided in this Section 5.

(a) If a Change in Control occurs, the Performance Period shall be deemed to end on the Change in Control Date. The determination of whether, and to what extent, the Performance Objective is achieved is based on actual performance against the stated performance criteria through the Change in Control Date and the number of Earned Performance Units will be equal to your Initial Performance Units multiplied by the percentage under the applicable “Percentage of Initial Performance Units Earned” column of Appendix A based on such performance through the Change in Control Date. In the event that you had Performance Units that remained outstanding pursuant to Section 4(b) or 4(c), the resulting Earned Performance Units will also be multiplied by any applicable Pro-Rata Fraction.

(b) The Earned Performance Units will be converted into time-based Restricted Stock Unit awards on a one-for-one basis.

(c) With respect to each outstanding Restricted Stock Unit, the Company shall credit a book entry account with an amount equal to the amount of any cash dividend paid following the Change in Control Date on one share of Common Stock (or any other security in lieu of Common Stock pursuant to Section 5(g)). The amount credited to such book entry account shall be payable to you at the same time or times, and subject to the same terms and conditions as are applicable to, your Restricted Stock Units.

(d) Subject to any acceleration or forfeiture events described within Section 4 , each outstanding Restricted Stock Unit shall cliff vest on the last day of the Performance Period (determined without regard to the occurrence of the Change in Control; i.e. , vesting will not accelerate solely on account of the Change in Control).

(e) In the event that your employment with the Company and each of its Subsidiaries by which you are employed is terminated following the Change in Control Date and prior to the end of the Performance Period (determined without regard to the occurrence of the Change in Control):

(i) Section 4 shall be applied after giving effect to the conversion of your Performance Units into Restricted Stock Units in accordance with this Section 5 ( e . g ., the term “Initial Performance Units” within Section 4(a)(i) shall be replaced with “Restricted Stock Units”),

(ii) for purposes of paragraph (c) of Section 4, a “Termination for Good Reason” shall include a termination by you due to Forced Relocation (as such term is defined in the Termination Agreement, if applicable),

(iii) for purposes of paragraphs (a) and (c) of Section 4, the Pro-Ration Fraction shall be deemed to be 100%, and

(iv) none of the conditions set forth in items (ii))-(iv) of Section 4(b) or the covenants contained in items (v) and (vi) of Section 4(b) shall apply.

(f) In the event that your employment with the Company and each of its Subsidiaries by which you are employed is terminated following the Change in Control Date and prior to the end of the Performance Period (determined without regard to the occurrence of the Change in Control) and shares of Common Stock become distributable to you pursuant to paragraphs (a), (b) or (c) of Section 4 and of this Section 5, subject to the following paragraph (g), vested Restricted Stock Units shall be settled in shares of Common Stock, as follows:

(i) If you are not a Section 409A Participant, the applicable shares shall be paid to you immediately (and in no event later than 30 days) following the earliest to occur of (x) the last day of the Performance Period (determined without regard to the occurrence of the Change in Control), (y) the termination of your employment relationship with the Company and each of its Subsidiaries, and (z) your death.

(ii) If you are a Section 409A Participant, the Change in Control constitutes a “change in the ownership or effective control” or “in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code and the regulations and other authoritative guidance promulgated thereunder (a “ 409A Change in Control ’), and your termination of employment occurs within the two year period immediately following such 409A Change in Control, then the applicable shares shall be paid to you immediately (and in no event later than 30 days) following the earliest to occur of (x) the last day of the Performance Period (determined without regard to the occurrence of the Change in Control), (y) the date that is six months and one day following the date of your separation from service with the Company (determined in accordance with the Company’s written and generally applicable policies regarding what constitutes a “separation from service” within the meaning of Section 409A of the Code and the regulations and other authoritative guidance promulgated thereunder) (“ Separation from Service ”), and (z) your death.

(iii) If you are a Section 409A Participant, and either the Change in Control does not constitute a 409A Change in Control, or your termination of employment does not occur within the two year period immediately following a 409A Change in Control, then the applicable shares shall be paid to you immediately (and in no event later than 30 days) following the earliest to occur of (x) the last day of the Performance Period (determined without regard to the occurrence of the Change in Control) and (y) your death.

(g) Notwithstanding anything else contained in this Section 5 to the contrary, if the Change in Control involves a merger, reclassification, reorganization or other similar transaction pursuant to which the Common Stock is exchanged for stock of the surviving corporation in such merger, the successor to the corporation or the direct or indirect parent of such a corporation (collectively, the “ Successor Corporation ”) or other securities, cash or property, then instead of each share of Common Stock, your Restricted Stock Units shall relate to and be settled in the same consideration (whether stock, securities, cash or other property) payable or distributable in such transaction in respect of a share of Common Stock. Any property distributed pursuant to this Section 5 , whether in shares of the Successor Corporation or otherwise, shall in all cases be freely transferable without any restriction (other than any such restriction that may be imposed at applicable law), and any securities issued hereunder shall be listed for trading on a U.S. national securities exchange and registered to trade under Section 12(b) of the 1934 Act, and shall have been registered under the Securities Act of 1933, as amended (the “ 1933 Act ”).

(h) Notwithstanding anything else contained in this Section 5 to the contrary, the Committee may elect, at its sole discretion by resolution adopted prior to the Change in Control Date, to satisfy your rights in respect of the Performance Units (as determined pursuant to the foregoing provisions of this Section 5), in whole or in part, by making a cash payment to you within 5 business days of the vesting date in respect of all or any portion of the Earned Performance Units or Restricted Stock Units, as applicable, as the Committee shall determine. Any cash payment for any Earned Performance Units or Restricted Stock Units shall be equal to the Fair Market Value of the number of shares of Common Stock or other property as described in Section 5(g) into which it would convert, determined on the vesting date.

(i) Notwithstanding anything else contained in this Section 5 to the contrary, in the event that this Award is not Assumed (as defined below) upon a Change in Control, then all of the Earned Performance Units calculated pursuant to Section 5(a) of this Agreement shall become unconditionally vested and unrestricted immediately prior to the Change in Control. The Earned Performance Units shall be settled in shares of Common Stock (or, if Section 5(g) applies above, in the securities, cash or other property provided pursuant to Section 5(g)), a cash settlement pursuant to Section 5(h), or a combination of such equity and cash, in accordance with the timing of settlement of the Change in Control consideration provided to Common Stock holders generally in connection with the Change in Control event; provided, however, that in the event the Change in Control does not constitute a 409A Change in Control, and you are a 409A Participant, your settlement of the applicable Earned Performance Shares shall be paid to you immediately following (and not later than 5 business days) the first to occur of: (i) a 409A Change in Control; (ii) the date that is six months and one day following the date of your Separation from Service; or (iii) the end of the Performance Period (determined without regard to the occurrence of the Change in Control). For purposes of this Agreement, the term, “ Assumed ,” means that, prior to or concurrently with the consummation of the transaction resulting in a Change in Control, either (i) this Agreement is expressly affirmed by the Company or (ii) the contractual obligations represented by this Agreement are expressly (and not merely by operation of law) assumed by the surviving or successor corporation or entity to the Company, or any parent or subsidiary of either thereof, or any other corporation or entity that is a party to the transaction resulting in the Change in Control, in connection with such Change in Control, with appropriate adjustments to the number and kind of securities of such

surviving or successor corporation or entity, or such other applicable parent, subsidiary, corporation or entity, subject to this Award, which preserves the compensation element of this Agreement existing at the time of such Change in Control, and provides for subsequent payout in accordance with the same (or more favorable) payment and vesting schedule applicable to this Award, as determined in accordance with the instruments evidencing the agreement to assume this Agreement; provided, however, that in no event will this Agreement be deemed to be “Assumed” unless the assumption is made by the entity that will be the issuer of the securities, cash or other property provided in exchange for Common Stock in the Change in Control transaction in question. The determination of comparability for this purpose shall be made by the Committee prior to the Change in Control, and its determination shall be final, binding and conclusive.

6. Nontransferability of Awards . The Performance Units granted hereunder may not be sold, transferred, pledged, assigned, encumbered or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Following your death, any shares distributable (or cash payable) in respect of Performance Units (or Restricted Stock Units) will be delivered or paid, at the time specified in Section 3 or, if applicable, Section 4 or Section 5, to your beneficiary in accordance with, and subject to, the terms and conditions hereof and of the Plan.

7. Beneficiary Designation . You may from time to time name any beneficiary or beneficiaries (who may be named contingently or successively) to whom shall be delivered or paid under this Agreement following your death any shares that are distributable or cash payable hereunder in respect of your Performance Units (or Restricted Stock Units) at the time specified in Section 3 or, if applicable, Section 4 or Section 5. Each designation will revoke all prior designations, shall be in a form prescribed by the Committee, and will be effective only when filed in writing with the Committee during your lifetime. In the absence of any such effective designation, shares issuable in connection with your death shall be paid to your surviving spouse, if any, or otherwise to your estate.

8. Adjustments in Respect of Performance Units . In the event of any common stock dividend or common stock split, recapitalization (including, but not limited to, the payment of an extraordinary dividend), merger, consolidation, combination, spin-off, distribution of assets to stockholders (other than cash dividends), exchange of shares, or other similar corporate change with regard to the Company or any Peer Company, appropriate adjustments shall be made by the Committee to the Initial Value of the corresponding common stock, and, if any such event occurs with respect to the Company, in the aggregate number of Performance Units subject to this Agreement; provided that, in the event of any such event involving a recapitalization, spin-off or distribution of assets to stockholders (other than cash dividends) by a Peer Company or the Company pursuant to which all stockholders of such Peer Company or the Company receive a security that is publicly traded on a stock exchange or automated quotation system pro rata based on each share of stock of the Peer Company or the Company held, then the Committee shall have the discretion to treat such recapitalization, spin-off or distribution as through it were a payment of a dividend under Section 2 of this Agreement in an amount equal to the fair market value thereof, as determined by the Committee in such manner as it deems appropriate. The Committee’s determination with respect to any such adjustment shall be conclusive.

9. Effect of Settlement . Upon conversion into shares of Common Stock (or Successor Corporation common stock) pursuant to Section 3 or Section 5(g), a cash settlement of your rights, at the election of the Committee at its sole discretion pursuant to Section 3 or Section 5(h), or a combination of the issuance of Common Stock and the payment of cash in accordance with any applicable provisions of this Agreement, all of your Performance Units (or Restricted Stock Units) subject to this Award shall be cancelled and terminated. If and to the extent that you are still employed at the end of the Performance Period, and none of your Performance Units shall have become earned in accordance with the terms of this Agreement, all such Performance Units subject to this Award shall be cancelled and terminated.

10. Furnish Information . You agree to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirements imposed upon the Company by or under any applicable statute or regulation.

11. Remedies . The parties to this Agreement shall be entitled to recover from each other reasonable attorneys' fees incurred in connection with the enforcement of the terms and provisions of this Agreement whether by an action to enforce specific performance or for damages for its breach or otherwise. If, due to Section 4 of the Plan, the Company fails or is unable to make the payment in respect of Earned Performance Units in freely transferable shares of Common Stock, and the Committee does not elect to settle such Earned Performance Units in cash instead of shares, as provided by Section 3 of this Agreement, as your sole and exclusive remedy for such failure, in addition to the rights provided under the first sentence of this Section 11, the Company shall pay to you an amount in cash equal to the product of the number of Earned Performance Units times the Fair Market Value of one share of Common Stock. The Company shall make such payment to you within ten (10) days following receipt of your written demand therefor, but in no event later than March 15 of the year following the year in which the Performance Units become Earned Performance Units, subject to compliance with any tax withholding obligations that the Company in its discretion deems to be necessary with respect to such payment. Upon such payment pursuant to this Section 11, all of your Performance Units subject to this Award shall be cancelled and terminated. For purposes of this Section 11, to give effect to Section 5 of this Agreement the term “Earned Performance Units” will be replaced with “Restricted Stock Units” where applicable, and the Fair Market Value of one share of Common Stock shall be determined as follows:

(a) with respect to a payment in respect of Earned Performance Units pursuant to Section 3, the Fair Market Value shall be determined as of the last day of the Performance Period;

(b) with respect to a payment in respect of Earned Performance Units where payment arises due to the termination of your employment with the Company or a Subsidiary during the Performance Period due to your death or Disability pursuant to Section 4(a), the Fair Market Value shall be determined as of the date your employment terminates due to death or Disability, as applicable;

(c) with respect to a payment in respect of Earned Performance Units where payment arises due to the termination of your employment with the Company or a Subsidiary during the Performance Period due to your Normal Retirement pursuant to Section 4(b), or due to your termination by the Company that is not a Termination for Cause or to your termination by you that

is a Termination for Good Reason pursuant to Section 4(c), the Fair Market Value shall be determined as of the last day of the Performance Period;

(d) with respect to a payment based on the number of Performance Units that would have become Earned Performance Units in connection with a Change in Control pursuant to Section 5, the Fair Market Value shall be determined as of the Change in Control Date.

12. Confidential Information and Nonsolicitation .

(a) As further consideration for the granting of the Performance Units hereunder, you hereby agree with the Company that, during and until three years following the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed, you will keep confidential all confidential or proprietary information and materials, as well as all trade secrets, belonging to the Company or one of its Subsidiaries, or their customers or other third parties who furnished such information, materials, and/or trade secrets to the Company or its Subsidiary with expectations of confidentiality (“ Confidential Information ”). Confidential Information shall not include information that (A) is already properly in the public domain or enters the public domain with the express consent of the Company, or (B) is intentionally made available by the Company to third parties without any expectation of confidentiality. Upon the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed, you promise to promptly return to the Company all Confidential Information, and all documents and materials (including electronically stored information) in your possession, custody or control that constitutes or reflects Confidential Information. Notwithstanding the foregoing, you may disclose information as may be required by law and may disclose information in confidence to your spouse, tax and financial advisors, or to a financial institution to the extent that such information is necessary to secure a loan, provided that you ensure that such spouse or advisor or institution treats the information confidentially and does not disclose such information or use it for his, her or its own benefit. In the event any breach of this promise comes to the attention of the Company, it shall take into consideration that breach in determining whether to recommend the grant of any future similar award to you, as a factor militating against the advisability of granting any such future award to you. Such consideration shall be in addition to the rights and remedies available to the Company pursuant to paragraph (d) below. Notwithstanding any other provision of this Agreement, you will not be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that (a) is made: (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (2) solely for the purpose of reporting or investigating a suspected violation of law, or (b) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. In addition, if you file a lawsuit for retaliation, you may disclose the Company’s trade secrets to your attorney and use the trade secret information in the court proceeding if you: (a) file any document containing the trade secret under seal, and (b) do not disclose the trade secret, except pursuant to court order.

you agree that during your employment relationship with the Company and each of its Subsidiaries by which you are employed, and for a period of twelve (12) months immediately following the time that you are no longer employed by the Company or any of its Subsidiaries, you will not, directly or indirectly (i) solicit or encourage (or assist another in soliciting or encouraging) any employee, contractor, consultant, supplier, or vendor of the Company or any of its Subsidiaries to terminate or lessen his, her or its relationship with the Company or any of its Subsidiaries, or (ii) on behalf of a Competitive Business, engage, employ, or solicit or contact for employment or engagement (or assist another in such activity) any employee of the Company or any of its Subsidiaries or any person who was an employee of the Company or any of its Subsidiaries at any time during the last twelve (12) months of your employment with the Company and any of its Subsidiaries (or, if you are employed by the Company and any of its Subsidiaries for less than twelve (12) months, those persons who were employees of the Company or any of its Subsidiaries during your employment with the Company and any of its Subsidiaries).

(c) You agree that the Company’s substantial investments in its business interests, goodwill, and Confidential Information are worthy of protection, and that the Company’s need for the protection afforded by this Section is greater than any hardship you might experience by complying with its terms. You further acknowledge and agree that the restrictions set forth in this Section are not adverse to the public interest. You further agree that the limitations as to time and scope of activity to be restrained contained herein are reasonable and are not greater than necessary to protect the Confidential Information, goodwill and other legitimate business interests of the Company. Although the Company and you believe the limitations as to time and scope of activity contained in this Section are reasonable and do not impose a greater restraint than necessary to protect the Company’s legitimate business interests, if this is judicially determined not to be the case, the Company and you specifically request that the limitations contained in this Section be reformed to the extent necessary to make this Section enforceable.

(d) You acknowledge and agree that your violation or threatened or attempted violation of the covenants contained in this Section will cause irreparable harm to the Company and that money damages would not be sufficient remedy for any breach of this Section. You agree that the Company shall be entitled as a matter of right to specific performance of the covenants in this Section, including entry of an ex parte temporary restraining order in state or federal court, preliminary and permanent injunctive relief against activities in violation of this Section, or both, or other appropriate judicial remedy, writ or order, in any court of competent jurisdiction, restraining any violation or further violation of such agreements by you or others acting on your behalf, without any showing of irreparable harm and without any showing that the Company does not have an adequate remedy at law. Such remedies shall be in addition to all other remedies available to the Company at law and equity.

(e) Your obligations under this Section shall survive the termination of this Agreement and your employment, regardless of the reason for such termination.

amended or replaced by the Company from time to time), including without limitation, (A) the Company’s ownership of the worldwide right, title and interest in and to any and all Pioneer Intellectual Property; (B) your agreement to assign, and pursuant to the Company’s Intellectual Property Policy and your acceptance of this Award you do hereby assign, to the Company all worldwide right, title and interest in and to all Pioneer Intellectual Property; and (C) your agreement to disclose in writing to the Company all Pioneer Intellectual Property and, upon request by the Company, to promptly produce and deliver to the Company all originals of materials embodying Pioneer Intellectual Property. The term, “Pioneer Intellectual Property,” is defined in the Company’s Intellectual Property Policy (and is incorporated herein by reference), and includes, without limitation, any and all creations, works and/or intellectual property (including but not limited to all tangible and intangible ideas and expressions of ideas whether or not the subject matter of copyright, confidential and non-confidential information, data, drawings, reports, programs, processes, analyses, business methods, computer programs, works of authorship, trademarks and service marks, improvements, discoveries and/or inventions whether or not patentable), and all of the intellectual property rights therein provided by the various legal systems throughout the world (including but not limited to trade secret rights, patent rights, trademark rights, and rights of copyright), that are conceived, created, made, invented, developed, reduced to practice, reduced to a tangible medium of expression, and/or acquired by you, individually or jointly with others, during the time of your employment relationship with the Company, that pertain to the actual or anticipated business or activities of the Company or that are suggested by or result from any task or work by you for or on behalf of the Company, irrespective whether you are or were hired-to-invent such creations, works or intellectual property, or whether such creations, works or intellectual property were conceived, created, made, invented, developed, reduced to practice, reduced to a tangible medium of expression or acquired in the course or scope of your employment, or whether at home or not, or whether or not during business hours, or whether or not using the Company’s time, facilities or resources. You may review the Company’s Intellectual Property Policy at the Company’s internal portal website, and obtain a copy by written request to the Company’s Legal Department.

(g) Nothing in this Agreement or any other agreement between you and the Company (i) prevents you from exercising any rights that cannot be lawfully waived or restricted, (ii) prevents you from testifying at a hearing, deposition, or in court in response to a lawful subpoena or (iii) limits your ability to file a charge or complaint with the Equal Employment Opportunity Commission, the Occupational Safety and Health Administration, the Securities and Exchange Commission, the United States Department of Justice, Congress, any agency Inspector General or any other federal, state or local governmental agency or commission (“Government Agencies”). Further, this Agreement does not limit (i) your ability to communicate with any Government Agencies or otherwise participate in any investigation or proceeding that may be conducted by any Government Agency, including providing documents or other information, without notice to the Company, or (ii) your right to receive an award from a Government Agency for information provided to any Government Agencies.

of this Award. With respect to any required tax withholding, unless another arrangement is permitted by the Company in its discretion, the Company shall withhold from the shares of Common Stock to be issued to you the number of shares necessary to satisfy the Company's obligation to withhold taxes, that determination to be based on the shares' Fair Market Value, as defined in the Plan, at the time as of which such determination is made. In the event the Company subsequently determines that the aggregate Fair Market Value, as defined in the Plan, of any shares of Common Stock withheld as payment of any tax withholding obligation is insufficient to discharge that tax withholding obligation, then you shall pay to the Company, immediately upon the Company's request, the amount of that deficiency.

14. Right of the Company and Subsidiaries to Terminate Employment . Nothing contained in this Agreement shall confer upon you the right to continue in the employ of the Company or any Subsidiary of the Company, or interfere in any way with the rights of the Company or any Subsidiary of the Company to terminate your employment at any time.

15. No Liability for Good Faith Determinations . Neither the Company nor the members of the Board and the Committee shall be liable for any act, omission or determination taken or made in good faith with respect to this Agreement or the Performance Units granted hereunder.

16. No Guarantee of Interests . The Board and the Company do not guarantee the Common Stock of the Company from loss or depreciation.

17. Company Records . Records of the Company or its Subsidiaries regarding your period of employment, termination of employment and the reason therefor, leaves of absence, re-employment, and other matters shall be conclusive for all purposes hereunder, unless determined by the Company to be incorrect.

18. Severability . If any provision of this Agreement is held to be illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions hereof, but such provision shall be fully severable and this Agreement shall be construed and enforced as if the illegal or invalid provision had never been included herein.

19. Notices . Whenever any notice is required or permitted hereunder, such notice must be in writing and personally delivered or sent by mail. Any such notice required or permitted to be delivered hereunder shall be deemed to be delivered on the date on which it is personally delivered, or, whether actually received or not, on the third Business Day after it is deposited in the United States mail, certified or registered, postage prepaid, addressed to the person who is to receive it at the address which such person has theretofore specified by written notice delivered in accordance herewith. The Company or you may change, at any time and from time to time, by written notice to the other, the address which it or he had previously specified for receiving notices.

The Company and you agree that any notices shall be given to the Company or to you at the following addresses:

Company: Pioneer Natural Resources Company

Attn: Corporate Secretary

5205 N. O’Connor Boulevard, Suite 200

Irving, Texas 75039-3746

Holder: At your current address as shown in the Company's records.

20. Waiver of Notice . Any person entitled to notice hereunder may waive such notice in writing.

21. Successor . This Agreement shall be binding upon you, your legal representatives, heirs, legatees and distributees, and upon the Company, its successors and assigns.

22. Headings . The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof.

23. Governing Law . All questions arising with respect to the provisions of this Agreement shall be determined by application of the laws of the State of Delaware except to the extent Delaware law is preempted by federal law. The obligation of the Company to sell and deliver Common Stock hereunder is subject to applicable laws and to the approval of any governmental authority required in connection with the authorization, issuance, sale, or delivery of such Common Stock.

24. Execution of Receipts and Releases . Any payment of cash or any issuance or transfer of shares of Common Stock or other property to you, or to your legal representative, heir, legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be in full satisfaction of all claims of such Persons hereunder. The Company may require you or your legal representative, heir, legatee or distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it shall determine.

25. Amendment . This Agreement may be amended at any time unilaterally by the Company provided that such amendment is consistent with all applicable laws and does not reduce any rights or benefits you have accrued pursuant to this Agreement. This Agreement may also be amended at any time unilaterally by the Company to the extent the Company believes in good faith that such amendment is necessary or advisable to bring this Agreement into compliance with any applicable laws, including Section 409A of the Code.

26. The Plan . This Agreement is subject to all the terms, conditions, limitations and restrictions contained in the Plan; provided, however, that notwithstanding anything to the contrary herein, any provision of this Agreement that is inconsistent with the provisions of Section 9(c), (e), and (f) of the Plan shall control over such provisions of the Plan.

27. Agreement Respecting Securities Act of 1933 . You represent and agree that you will not sell the Common Stock that may be issued to you pursuant to your Performance Units except pursuant to an effective registration statement under the 1933 Act or pursuant to an exemption from registration under the 1933 Act (including Rule 144).

28. No Shareholder Rights . The Performance Units granted pursuant to this Agreement do not and shall not entitle you to any rights as a shareholder of Common Stock until such time as you receive shares of Common Stock pursuant to this Agreement. Your rights with respect to the Performance Units shall remain forfeitable at all times prior to the date on which rights become earned in accordance with this Agreement.

29. Electronic Delivery and Acknowledgement . No signature by you is required to accept the Award represented by this Agreement. By your acceptance of this Award, you are acknowledging that you have received and read, understood and accepted all the terms, conditions and restrictions of this Agreement and the Plan. The Company may, in its sole discretion, deliver any documents related to this Award and this Agreement, or other awards that have been or may be awarded under the Plan, by electronic means, including prospectuses, proxy materials, annual reports and other related documents, and the Company may, in its sole discretion, engage a third party to effect the delivery of these documents on its behalf and provide other administrative services related to this Award and the Plan. By your acceptance of the Award represented by this Agreement, you consent to receive such documents by electronic delivery and to the engagement of any such third party.

Appendix A

Determination of Performance Units Earned

Peer Companies :



Rank Against Peers	11 Peer Companies Percentage of Initial Performance Units Earned	10 Peer Companies Percentage of Initial Performance Units Earned	9 Peer Companies Percentage of Initial Performance Units Earned	8 Peer Companies Percentage of Initial Performance Units Earned	7 Peer Companies Percentage of Initial Performance Units Earned
1 2 3 4 5 6 7 8 9 10 11 12	250% 200% 175% 150% 125% 110% 75% 50% 25% 0% 0% 0%	250% 200% 175% 150% 125% 100% 75% 50% 25% 0% 0%	250% 200% 170% 140% 110% 80% 50% 25% 0% 0%	250% 200% 166% 133% 100% 65% 30% 0% 0%	250% 200% 155% 110% 70% 30% 0% 0%

In addition, if at the end of the Performance Period the number of companies listed above that qualify as Peer Companies is less than seven, then the Committee shall, in good faith, determine the percentage of the Performance Units earned in a manner consistent with (i) the requirements to qualify the Performance Units as performance-based compensation exempt from the limitations imposed by Section 162(m) of the Internal Revenue Code of 1986, as amended, to the extent the Committee determines that such qualification is in the Company’s best interest, and (ii) the following general guidelines for determining the number of earned Performance Units:

(a) If the Company’s Total Shareholder Return for the Performance Period ranks first as compared to the Total Shareholder Return of qualifying Peer Companies, the number of earned Performance Units shall equal 250% of the Initial Performance Units;

(b) If the Company’s Total Shareholder Return for the Performance Period ranks in the 55th percentile as compared to the Total Shareholder Return of the qualifying Peer Companies, the number of earned Performance Units shall equal 100% of the Initial Performance Units;

(c) If the Company’s Total Shareholder Return for the Performance Period ranks in the 28th percentile as compared to the Total Shareholder Return of the qualifying Peer Companies, the number of earned Performance Units shall equal 25% of the Initial Performance Units;

(d) If the Company’s Total Shareholder Return ranks below the 28th percentile as compared to the Total Shareholder Return of the qualifying Peer Companies, none of the Initial Performance Units will become earned; and

(e) If the Company’s Total Shareholder Return ranking falls in between the levels specified in clauses (a) through (c) above, the Committee shall have the discretion to determine the percentage of the Initial Performance Shares that become earned within the levels specified above.

Schedule I

The document to which this Schedule I is attached is the form of Performance Unit Award Agreement between the Company and and Timothy L. Dove.

1. The form of Performance Unit Award Agreement between the Company and each of Mark S. Berg, Chris J. Cheatwood, Richard P. Dealy, J. D. Hall, Kenneth H. Sheffield, Jr., William F. Hannes, Frank E. Hopkins, Mark H. Kleinman, Teresa A. Fairbrook, and Stephanie D. Stewart varies from this form by modifying paragraph (c) of Section 4 to provide in its entirety as follows:

(c) Termination Without Cause or Termination For Good Reason . In the event that your employment with the Company and each of its Subsidiaries by which you are employed is terminated during the Performance Period (x) by the Company and such Subsidiaries and such termination is not a Termination for Cause or (y) by you and such termination is a Termination for Good Reason (as each such term is defined in the Termination Agreement), you shall be deemed to have earned, as of the end of the Performance Period, that number of Performance Units equal to the product of (i) the number of Earned Performance Units that you would have earned in accordance with Section 2 had you remained employed through the end of the Performance Period multiplied by (ii) the Pro-Ration Fraction. Any portion of the Performance Units that cannot become earned and payable in accordance with the preceding sentence shall terminate and automatically be cancelled as of the date of your termination of employment. Any portion of your Performance Units that is eligible to be earned pursuant to the second preceding sentence, but is not earned as of the end of the Performance Period, shall terminate and be cancelled upon the expiration of such Performance Period.

2. The form of Performance Unit Award Agreement between the Company Margaret M. Montemayor varies from this form as follows:

A. Paragraph (b) of Section 1 is modified to delete the words “or Restricted Stock Units granted pursuant to Section 5, as applicable”.

B. Sections 3, 4 and 5 are modified to provide in their entirety as follows:

3. Conversion of Performance Units; Delivery of Performance Units . Unless an earlier date applies pursuant to Section 4(a), Section 5 or Section 6, payment in respect of Earned Performance Units shall be made not later than March 1 of the year following the year in which the Performance Period ends. Unless otherwise determined by the Committee, all payments in respect of Earned Performance Units shall be made in freely transferable shares of Common Stock; provided, however, that if and to the extent that the reservation of the power to settle (as opposed to the act of settling) Performance Units in cash instead of shares would result in an additional financial accounting charge for the Company, the Committee shall not have the right to settle such Performance Units other than in the form of Common Stock (or, if applicable, stock of a Successor Corporation (as defined in Section 5)). Neither this Section 3 nor any action taken pursuant to or in accordance with this Section 3 shall be construed to create a trust of any kind. Any shares of Common Stock issued to you pursuant to this Agreement in settlement of Earned Performance Units shall be in book entry form registered in your name. Any fractional Earned Performance Units shall be rounded up to the nearest whole share of Common Stock.

4. Termination of Employment .

(a) Death or Disability . In the event that your employment with the Company or a Subsidiary terminates during the Performance Period due to your death or Disability (as such term is defined in the Severance Agreement between you and the Company or one of its subsidiaries), you shall be deemed to have Earned Performance Units equal to the product of (i) and (ii), where (i) and (ii) are:

(i) the Initial Performance Units;

(ii) a fraction (the “Pro-Ration Fraction”), (A) the numerator of which is the number of full months (counting the month in which your termination of employment occurs as a full month) during the Performance Period during which you were employed and (B) the denominator of which is 36.

Distribution of shares of Common Stock in respect of the Performance Units determined to be earned by reason of this Section 4(a) shall be made not later than 74 days following your death or Disability and shall be in full and complete satisfaction of all of your rights (and the rights of any person who derives his, her or its rights from you) under this Agreement. In the event that there is no such Severance Agreement at the time of such termination, the term, “Disability,” shall mean (i) a physical or mental impairment of sufficient severity that, in the opinion of the Company, (A) you are unable to continue performing the duties assigned to you prior to such impairment or (B) your condition entitles you to disability benefits under any insurance or employee benefit plan of the Company or its Subsidiaries and (ii) the impairment or condition is cited by the Company as the reason for your termination; provided further, that in all cases, the term Disability shall be applied and interpreted in compliance with Section 409A of the Code and the regulations thereunder.

the Vice President and Chief Human Resources Officer (or his or her delegate) or the Board, as applicable).

(iii) You have cooperated with the Company, to the satisfaction of the Company, in the training of a replacement during the period prior to the termination of employment.

(iv) If required by the Company, you execute and deliver to the Company an effective release of claims and other liability in a form acceptable to the Company.

For purposes of this Agreement, “Normal Retirement” shall mean the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed due to your retirement on or after the date that you attain age 60, provided that you have completed five Years of Service as of the date of such termination. For purposes of this Agreement, “Years of Service” means the total number of years that you have been employed by the Company or its Subsidiaries as determined in accordance with the Company’s policies as administered from time to time. For the avoidance of doubt, the Company’s determination of Years of Service shall be at the sole discretion of the Company, its policies may change from time to time, and its determination will be final and conclusive and binding on all Participants.

(c) Termination Without Cause or Termination For Good Reason . In the event that your employment with the Company and each of its Subsidiaries by which you are employed is terminated during the Performance Period (x) by the Company and such Subsidiaries and such termination is not a Termination for Cause or (y) by you and such termination is a Termination for Good Reason (as each such term is defined in the Severance Agreement between you and the Company or one of its subsidiaries), you shall be deemed to have earned, as of the end of the Performance Period, that number of Performance Units equal to the product of (i) the number of Earned Performance Units that you would have earned in accordance with Section 2 had you remained employed through the end of the Performance Period multiplied by (ii) the Pro-Ration Fraction. Any portion of the Performance Units that cannot become earned and payable in accordance with the preceding sentence shall terminate and automatically be cancelled as of the date of your termination of employment. Any portion of your Performance Units that is eligible to be earned pursuant to the second preceding sentence, but is not earned as of the end of the Performance Period, shall terminate and be cancelled upon the expiration of such Performance Period.

(d) Other Termination of Employment . Unless otherwise determined by the Committee at or after grant, in the event that your employment with the Company or a Subsidiary terminates prior to the end of the Performance Period for any reason other than those listed in Section 4(a), 4(b) or 4(c), all of your Performance Units shall terminate and automatically be cancelled upon such termination of employment.

5. Change in Control . Notwithstanding the provisions of Section 1 through Section 4 hereof or the terms of any Change in Control Agreement between you and the Company or a Subsidiary (a “CIC Agreement”), if you have been continuously employed from the grant date specified above until the date that the Change in Control occurs (the “Change in Control Date”) or you are treated, for purposes of such CIC Agreement, to have remained in employment through the Change in Control Date, upon the occurrence of a Change in Control your rights in respect of the Performance Units shall be determined as provided in Section 5(a). If your employment shall have terminated prior to the Change in Control Date, but at least some of your Performance Units remain outstanding pursuant to Section 4(b) or Section 4(c), your rights in respect of your outstanding Performance Units shall be determined as provided in Section 5(b).

(a) If a Change in Control occurs, you will be issued a number of shares of Common Stock equal to the number of Performance Units that would have become Earned Performance Units in accordance with the provisions of Section 2 assuming that:

(i) the Performance Period ended on the Change in Control Date and

(ii) the determination of whether, and to what extent, the Performance Objective is achieved, is based on actual performance against the stated performance criteria through the Change in Control Date.

(b) If your employment terminated prior to the Change in Control Date, but some or all of your Performance Units are still outstanding on such date pursuant to Section 4(b) or 4(c), then, you shall receive a number of shares of Common Stock equal to the product of (A) the number of shares of Common Stock that would have been issued to you in respect to the Initial Performance Units, determined as though Section 5(a) was applicable to you times (B) the Pro-Ration Fraction.

(c) Any shares of Common Stock issuable pursuant to this Section 5 shall be issued immediately following (and not later than) 5 business days after the Change in Control Date and shall be fully earned and freely transferable as of the date of the Change in Control. Notwithstanding anything else contained in this Section 5 to the contrary, if the Change in Control involves a merger, reclassification, reorganization or other similar transaction pursuant to which the Common Stock is exchanged for stock of the surviving corporation in such merger, the successor to the corporation or the direct or indirect parent of such a corporation (collectively, the “Successor Corporation”), then you shall receive, instead of each share of Common Stock otherwise deliverable hereunder, the same consideration (whether stock, cash or other property) payable or distributable in such transaction in respect of a share of Common Stock. Any property distributed pursuant to this Section 5(c), whether in shares of the Successor Corporation or otherwise, shall in all cases be freely transferable without any restriction (other than any such restriction that may be imposed at applicable law), and any securities issued hereunder shall be registered to trade under the 1934 Act, and shall have been registered under the Securities Act of 1933, as amended (the “1933 Act”).

(d) Notwithstanding anything else contained in this Section 5 to the contrary, the Committee may elect, at its sole discretion by resolution adopted prior to the Change in Control Date, to satisfy your rights in respect of the Performance Units (as determined pursuant to the foregoing provisions of this Section 5), in whole or in part, by making a cash payment to you within 5 business days of the Change in Control Date in respect of all such Performance Units or such portion of such Performance Units as the Committee shall determine. Any cash payment for any

Performance Unit shall be equal to the Fair Market Value of the number of shares of Common Stock into which it would convert, determined on the Change in Control Date.

C. Each of Sections 6 and 7 is modified to delete the parenthetical “(or Restricted Stock Units).”

D Section 9 is modified to provide in its entirety as follows:

9. Effect of Settlement . Upon conversion into shares of Common Stock (or Successor Corporation common stock) pursuant to Section 3 or Section 5, a cash settlement of your rights, at the election of the Committee at its sole discretion pursuant to Section 3 or Section 5(d), or a combination of the issuance of Common Stock and the payment of cash in accordance with any applicable provisions of this Agreement, all of your Performance Units subject to this Award shall be cancelled and terminated. If and to the extent that you are still employed at the end of the Performance Period, and none of your Performance Units shall have become earned in accordance with the terms of this Agreement, all such Performance Units subject to this Award shall be cancelled and terminated.

E. The last sentence of Section 11 is modified to delete the words “to give effect to Section 5 of this Agreement the term ‘Earned Performance Units’ will be replaced with ‘Restricted Stock Units’ where applicable, and.”

F. Paragraph (b) of Section 12 is modified to read in its entirety as follows:

(b) As an incentive for the Company to issue you this Award, and in consideration of the Company’s promise to provide you with Confidential Information and so as to protect the Company’s legitimate business interests, including the protection of its Confidential Information and the goodwill with which you will be associated, and that this Award will encourage you to build, you agree that during your employment relationship with the Company and each of its Subsidiaries by which you are employed, and for a period of twelve (12) months immediately following the time that you are no longer employed by the Company or any of its Subsidiaries, you will not, directly or indirectly (i) solicit or encourage (or assist another in soliciting or encouraging) any employee, contractor, consultant, supplier, or vendor of the Company or any of its Subsidiaries to terminate or lessen his, her or its relationship with the Company or any of its Subsidiaries, or (ii) on behalf of any business that competes with the Company or any Subsidiary in the business of exploration or production of oil or natural gas, or related oilfield services, within the geographic area or areas in which the Company or any Subsidiary operates at the time of termination of employment or has operated in the immediately preceding one-year period (a “ Competitive Business ”), engage, employ, or solicit or contact for employment or engagement (or assist another in such activity) any employee of the Company or any of its Subsidiaries or any person who was an employee of the Company or any of its Subsidiaries at any time during the last twelve (12) months of your employment with the Company and any of its Subsidiaries (or, if you are employed by the Company and any of its Subsidiaries for less than twelve (12) months, those persons who were employees of the Company or any of its Subsidiaries during your employment with the Company and any of its Subsidiaries).

Exhibit 10.3

RESTRICTED STOCK UNIT AWARD AGREEMENT

PIONEER NATURAL RESOURCES COMPANY
AMENDED AND RESTATED 2006 LONG TERM INCENTIVE PLAN

[Date]

To: Timothy L. Dove

Pioneer Natural Resources Company, a Delaware corporation (the “ Company ”), is pleased to grant you an award (this “ Award ”) to receive ___________ Restricted Stock Units (the “ Restricted Stock Units ”) whereby each Restricted Stock Unit represents the right to receive one share of common stock, par value $0.01, of the Company (the “ Stock ”), plus an additional amount pursuant to Section 2, subject to certain restrictions and on the terms and conditions contained in this Restricted Stock Unit Award Agreement (this “ Agreement ”) and the Pioneer Natural Resources Company Amended and Restated 2006 Long Term Incentive Plan (the “ Plan ”). A copy of the Plan is available upon request. Except as provided below, to the extent that any provision of this Agreement conflicts with the expressly applicable terms of the Plan, you acknowledge and agree that those terms of the Plan shall control and, if necessary, the applicable provisions of this Agreement shall be deemed amended so as to carry out the purpose and intent of the Plan. Terms that have their initial letters capitalized, but that are not otherwise defined in this Agreement, shall have the meanings given to them in the Plan in effect as of the date of this Agreement.

This Agreement sets forth the terms of the agreement between you and the Company with respect to the Restricted Stock Units. By accepting this Agreement, you agree to be bound by all of the terms hereof.

1. No Shareholder Rights . The Restricted Stock Units granted pursuant to this Agreement do not and shall not entitle you to any rights of a stockholder of the Company prior to the date shares of Stock are issued to you in settlement of this Award. Your rights with respect to Restricted Stock Units shall remain forfeitable at all times prior to the date on which rights become vested and the restrictions with respect to the Restricted Stock Units lapse in accordance with Sections 4, 5 or 6.

2. Dividend Equivalents . In the event that the Company declares and pays a dividend in respect of its outstanding shares of Stock and, on the record date for such dividend, you hold Restricted Stock Units granted pursuant to this Agreement that have not been settled, the Company shall pay to you an amount in cash equal to the cash dividends you would have received if you were the Beneficial Owner, as of such record date, of the number of shares of Stock related to the portion of your Restricted Stock Units that have not been settled as of such record date, such payment to be made on or promptly following the date that the Company pays such dividend (however, in no

event shall the dividend equivalent payment be made later than 30 days following the date on which the Company pays such dividend).

3. Conversion of Restricted Stock Units; Issuance of Stock; Payment of Stock . No shares of Stock shall be issued to you prior to the date on which the Restricted Stock Units vest and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 4, 5 or 6. Neither this Section 3 nor any action taken pursuant to or in accordance with this Section 3 shall be construed to create a trust of any kind. Except as otherwise expressly provided in Section 5, 6 or Section 26, after any Restricted Stock Units that become vested pursuant to Section 4, 5 or 6 the Company shall, on or no later than 30 days following the earliest of the applicable vesting dates set forth in this Agreement, cause to be issued Stock in book entry form registered in your name in payment of such vested Restricted Stock Units upon receipt by the Company of any required tax withholding with respect to such shares. The value of any fractional Restricted Stock Units shall be paid in cash at the time Stock is issued to you in connection with the Restricted Stock Units. The value of the fractional Restricted Stock Units shall equal the percentage of a Restricted Stock Unit represented by a fractional Restricted Stock Unit multiplied by the Fair Market Value of the Stock. The value of such shares of Stock shall not bear any interest owing to the passage of time.

4. Expiration of Restrictions, Risk of Forfeiture and Original Payment Date. Subject to the terms and conditions of this Agreement, the forfeiture restrictions on the Restricted Stock Units granted pursuant to this Agreement will expire in full on the third anniversary of the date of this Agreement (the “ Vesting Date ”); provided, however , that such restrictions will expire on the Vesting Date only if you have been an employee of the Company or of a Subsidiary continuously from the date of this Agreement through the Vesting Date; provided , further , however , that if you cease to be an employee of the Company or of a Subsidiary for any reason after the Vesting Date, all Restricted Stock Units granted pursuant to this Agreement will survive the termination of employment. In the event that your Restricted Stock Units become vested pursuant to this Section 4, the payment of the Stock related to your vested Restricted Stock Units shall be made to you immediately (and in no event later than 30 days) following the Vesting Date.

5. [RESERVED]

6. Termination of Employment .

(a) Termination by Employee Without Good Reason or by the Company for Cause . Except as otherwise provided in this Agreement, if your employment relationship with the Company and each of its Subsidiaries by which you are employed terminates prior to the Vesting Date due to (x) a voluntary termination by you and such termination is not a Termination for Good Reason (as such term is defined in the Termination Agreement (as defined below)) or due to Forced Relocation (as such term is defined in the Termination Agreement, if applicable), or (y) the Company terminating such employment for Cause (as such term is defined in the Termination Agreement), then all Restricted Stock Units granted pursuant to this Agreement shall become null and void as of the date of such termination. For purposes of this Agreement, “ Termination Agreement ” means, prior to the occurrence of a Change in Control, the Severance Agreement or other separate agreement between you and the Company and/or any of its subsidiaries relating to the provision of severance and other benefits before a Change in Control and, upon and following the occurrence of a Change

in Control, the Change in Control Agreement or other separate agreement between you and the Company and/or any of its subsidiaries relating to the provision of severance and other benefits upon or after a Change in Control.

(b) Termination Not For Cause; Good Reason . Notwithstanding Section 4 of this Agreement, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date (x) by the Company and such Subsidiaries and such termination is not a Termination for Cause or (y) by you and such termination is a Termination for Good Reason, then all of the Restricted Stock Units granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted.

(c) Termination upon Death or Disability . Notwithstanding Section 4 of this Agreement, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date as a result of your death or Disability (defined below) then the restrictions on a number of the Restricted Stock Units shall automatically lapse such that the number of Restricted Stock Units for which the restrictions have lapsed as of the termination date will be equal to the product of (x) the total number of Restricted Stock Units granted to you pursuant to this Agreement, times (y) a fraction, the numerator of which is the number of full months (counting the month in which your termination of employment occurs as a full month), beginning with March ______, during which you were employed by the Company and/or any Subsidiary and the denominator of which is 36 (the “ Pro-Rata Formula ”). The portion, if any, of your Restricted Stock Units for which the restrictions have not lapsed as of the termination date of your employment relationship shall become null and void as of the termination date; provided , however , that the portion, if any, of this Award for which forfeiture restrictions have lapsed as of the date of termination shall survive.

Notwithstanding the forgoing, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date, but upon or following a Change in Control, (x) by you and such termination is a Termination due to Forced Relocation, whether or not such termination is also in connection with a Change in Control, or (y) your death or Disability (as defined below), then all of the Restricted Stock Units granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted.

For purposes of this Agreement, “ Disability ” shall have the meaning given such term in the Termination Agreement; provided, however, that if there is no such agreement at the time of such termination, the term Disability shall mean (i) a physical or mental impairment of sufficient severity that, in the opinion of the Company, (A) you are unable to continue performing the duties assigned to you prior to such impairment or (B) your condition entitles you to disability benefits under any insurance or employee benefit plan of the Company or its Subsidiaries and (ii) the impairment or condition is cited by the Company as the reason for your termination; provided further, that in all cases, the term Disability shall be applied and interpreted in compliance with Section 409A of the Code and the regulations thereunder.

(d) Termination in Connection with Normal Retirement . Notwithstanding Section 4 of this Agreement, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date as a result of your

Normal Retirement (defined below), then all of the Restricted Stock Units granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted upon your termination of employment if the following conditions are met (provided that the following conditions, other than item (i) below, shall not apply if your employment terminates upon or following a Change in Control): (x) as of the date of the termination of your employment, the conditions set forth below in items (i)-(iv) are satisfied and (y) you intend to comply with the covenants contained in items (v) and (vi) below (which intent shall be conclusively presumed unless, prior to or concurrently with the notice provided pursuant to item (ii) below, you notify the Company in writing, addressed to the Vice President and Chief Human Resources Officer (or his or her successor), that you do not intend to comply with such covenants).

(i)

The date of the termination of your employment is at least one year after the date of this Agreement (but if not, instead of all of the Restricted Stock Units granted pursuant to this Agreement becoming immediately and unconditionally vested and unrestricted, restrictions on a number of the Restricted Stock Units shall automatically lapse such that the number of Restricted Stock Units for which the restrictions have lapsed as of the termination date will be equal to the product of (x) the total number of Restricted Stock Units granted to you pursuant to this Agreement times (y) the Pro-Rata Formula).

(ii)

You gave advance written notice of your intent to terminate your employment due to Normal Retirement at least six months in advance of the date of termination to the Vice President and Chief Human Resources Officer (or his or her delegate), and to your direct manager, or in the case of the chief executive officer of the Company, to the Board (subject to the ability of the Company to waive such requirement, exercisable by the Vice President and Chief Human Resources Officer (or his or her delegate) or the Board, as applicable).


(iii)	You have cooperated with the Company, to the satisfaction of the Company, in the training of a replacement during the period prior to the termination of employment.


(iv)	If required by the Company, you execute and deliver to the Company an effective release of claims and other liability in a form acceptable to the Company.

(v)

geographic area or areas in which the Company or any Subsidiary operates at the time of termination of employment or has operated in the immediately preceding one-year period (a “ Competitive Business ”); provided that, you will not be restricted from purchasing or holding for investment purposes less than 2% of the shares of any Competitive Business whose shares are regularly traded on a national securities exchange or inter-dealer quotation system. If the Company so requires prior to the date of termination of employment, the Company may require that you execute a separate agreement to effect the intent of the foregoing.

(vi)

For two years following the termination of your employment, you agree to refrain from making, or causing or assisting any other person to make, any oral or written communication to any third party about the Company and/or any of the employees, officers or directors of the Company which impugns or attacks, or is otherwise critical of, the reputation, business or character of such entity or person; or that discloses private or confidential information about their business affairs; or that constitutes an intrusion into their seclusion or private lives; or that gives rise to unreasonable publicity about their private lives; or that places them in a false light before the public; or that constitutes a misappropriation of their name or likeness (the foregoing being subject to Section 10(g)). If the Company so requires prior to the date of termination of employment, the Company may require that you execute a separate agreement to effect the intent of the foregoing.

You expressly acknowledge and agree that the restrictions set forth in clauses (v) and (vi) of this Section 6(c) are reasonable in all respects, necessary to protect the Company’s legitimate business interests and a material inducement for the Company to grant this Award to you and enter into this Agreement. In the event that, following your termination of employment, it is determined by a court of competent jurisdiction that you have not satisfied any of the conditions set forth in Section 6(c)(v) or (vi) in any material respect, then, as to any shares of Stock related to your Restricted Stock Units that have not been paid to you, such Restricted Stock Units shall be deemed not to have vested in whole or in part pursuant to any paragraph of this Section 6 and such shares shall not be payable. Notwithstanding the foregoing, in the event there occurs a Change in Control, whether prior to or after the date that the restrictions on your Restricted Stock Units have lapsed or the payment date of any Stock related to your Restricted Stock Units, the restrictions set forth in clauses (v) and (vi) of this Section 6(c) shall automatically terminate and become void and of no effect.

the sole discretion of the Company, its policies may change from time to time, and its determination will be final and conclusive and binding on all Participants.

(e) Distribution and Payment . Upon termination of your employment relationship with the Company and each of its Subsidiaries as a result of your death, the shares of Stock related to your Restricted Stock Units that become vested pursuant to paragraph (b) of this Section 6 shall be paid to you immediately (and in no event later than 30 days) following your death. Upon termination of your employment relationship with the Company and each of its Subsidiaries under all other circumstances contemplated by paragraphs (b), (c) and (d) of this Section 6 (“ Section 6 Acceleration Events ”), the following shall apply:


(i)	If you are not a Section 409A Participant (as defined below), the shares of Stock related to your Restricted Stock Units that become vested pursuant to such paragraphs shall be paid to you immediately (and in no event later than 30 days) following the termination of your employment relationship with the Company and each of its Subsidiaries.

(ii)

If you would attain age 60 on or prior to December 31, ______ (a “ Section 409A Participant ”), and your Restricted Stock Units become vested pursuant to a Section 6 Acceleration Event (other than death) that occurs either (I) prior to the occurrence of a “change in the ownership or effective control” or “in the ownership of a substantial portion of the assets” of the Company (a “ 409A Change in Control ”) within the meaning of Section 409A of the Code and the regulations and other authoritative guidance promulgated thereunder (collectively, the “ Nonqualified Deferred Compensation Rules ”) or (II) after the two year period immediately following a 409A Change in Control, the shares of Stock related to your Restricted Stock Units that become vested pursuant to such event shall be paid to you immediately (and in no event later than 30 days) following the earliest to occur of the following:

(A) the Vesting Date; or

(B) your death.

(iii)

If you are a Section 409A Participant and your Restricted Stock Units become vested pursuant to a Section 6 Acceleration Event (other than death) that occurs within the two year period immediately following a 409A Change in Control, the shares of Stock related to your Restricted Stock Units that become vested pursuant to such event shall not be payable to you pursuant to the foregoing clause (ii), but instead shall be paid to you immediately (and in no event later than 30 days) following the earliest to occur of the following:

(A) the Vesting Date;


(B)	the date that is six months and one day following the date of your separation from service with the Company (determined in accordance with the Company’s written and generally applicable policies regarding what constitutes a “separation from service” within the meaning of the Nonqualified Deferred Compensation Rules ) (“ Separation from Service ”); or

7. Awards Not Assumed in Connection with a Change in Control . In the event that this Award is not Assumed (as defined below) in connection with a Change in Control, then all of the Restricted Stock Units granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted immediately prior to the Change in Control. The shares of Stock related to your Restricted Stock Units that become vested pursuant to this Section 7 shall be paid to you in accordance with the timing of the settlement of the Change in Control consideration provided to Common Stock holders generally in connection with the Change in Control event; provided, however , that if (i) you are a Section 409A Participant and (ii) the event constituting a Change in Control does not also constitute a 409A Change in Control, the shares of Stock related to your Restricted Stock Units that become vested pursuant to this Section 7 shall be paid to you immediately (and in no event later than 30 days) following the first to occur of (A) a 409A Change in Control, (B) the date that is six months and one day following the date of your Separation from Service or (C) the Vesting Date. For purposes of this Agreement, the term, “ Assumed ,” means that, prior to or concurrently with the consummation of the transaction resulting in a Change in Control, either (i) this Agreement is expressly affirmed by the Company or (ii) the contractual obligations represented by this Agreement are expressly (and not merely by operation of law) assumed by the surviving or successor corporation or entity to the Company, or any parent or subsidiary of either thereof, or any other corporation or entity that is a party to the transaction resulting in the Change in Control, in connection with such Change in Control, with appropriate adjustments to the number and kind of securities of such surviving or successor corporation or entity, or such other applicable parent, subsidiary, corporation or entity, subject to this Award, which preserves the compensation element of this Agreement existing at the time of such Change in Control, and provides for subsequent payout in accordance with the same (or more favorable) payment and vesting schedule applicable to this Award, as determined in accordance with the instruments evidencing the agreement to assume this Agreement; provided, however, that in no event will this Agreement be deemed to be “Assumed” unless the assumption is made by the entity that will be the issuer of the securities, cash or other property provided in exchange for Common Stock in the Change in Control transaction in question. The determination of comparability for this purpose shall be made by the Committee prior to the Change in Control, and its determination shall be final, binding and conclusive.

shall be adjusted in the manner consistent with the adjustment provisions provided in Section 9(b) and 9(c)(ii) of the Plan.

9. Furnish Information . You agree to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirements imposed upon the Company by or under any applicable statute or regulation.

10. Remedies . The parties to this Agreement shall be entitled to recover from each other reasonable attorneys’ fees incurred in connection with the enforcement of the terms and provisions of this Agreement whether by an action to enforce specific performance or for damages for its breach or otherwise.

11. Confidential Information and Nonsolicitation .

(a) As further consideration for the granting of the Restricted Stock Units hereunder, you hereby agree with the Company that, during and until three years following the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed, you will keep confidential all confidential or proprietary information and materials, as well as all trade secrets, belonging to the Company or one of its Subsidiaries, or their customers or other third parties who furnished such information, materials, and/or trade secrets to the Company or its Subsidiary with expectations of confidentiality (“ Confidential Information ”). Confidential Information shall not include information that (A) is already properly in the public domain or enters the public domain with the express consent of the Company, or (B) is intentionally made available by the Company to third parties without any expectation of confidentiality. Upon the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed, you promise to promptly return to the Company all Confidential Information, and all documents and materials (including electronically stored information) in your possession, custody or control that constitutes or reflects Confidential Information. Notwithstanding the foregoing, you may disclose information as may be required by law and may disclose information in confidence to your spouse, tax and financial advisors, or to a financial institution to the extent that such information is necessary to secure a loan, provided that you ensure that such spouse or advisor or institution treats the information confidentially and does not disclose such information or use it for his, her or its own benefit. In the event any breach of this promise comes to the attention of the Company, it shall take into consideration that breach in determining whether to recommend the grant of any future similar award to you, as a factor militating against the advisability of granting any such future award to you. Such consideration shall be in addition to the rights and remedies available to the Company pursuant to paragraph (d) below. Notwithstanding any other provision of this Agreement, you will not be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that (a) is made: (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (2) solely for the purpose of reporting or investigating a suspected violation of law, or (b) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. In addition, if you file a lawsuit for retaliation, you may disclose the Company’s trade secrets to your attorney and use the trade secret information in the court proceeding if you: (a) file any document containing the trade secret under seal, and (b) do not disclose the trade secret, except pursuant to court order.

(b) As an incentive for the Company to issue you this Award, and in consideration of the Company’s promise to provide you with Confidential Information and so as to protect the Company’s legitimate business interests, including the protection of its Confidential Information and the goodwill with which you will be associated, and that this Award will encourage you to build, you agree that during your employment relationship with the Company and each of its Subsidiaries by which you are employed, and for a period of twelve (12) months immediately following the time that you are no longer employed by the Company or any of its Subsidiaries, you will not, directly or indirectly (i) solicit or encourage (or assist another in soliciting or encouraging) any employee, contractor, consultant, supplier, or vendor of the Company or any of its Subsidiaries to terminate or lessen his, her or its relationship with the Company or any of its Subsidiaries, or (ii) on behalf of a Competitive Business, engage, employ, or solicit or contact for employment or engagement (or assist another in such activity) any employee of the Company or any of its Subsidiaries or any person who was an employee of the Company or any of its Subsidiaries at any time during the last twelve (12) months of your employment with the Company and any of its Subsidiaries (or, if you are employed by the Company and any of its Subsidiaries for less than twelve (12) months, those persons who were employees of the Company or any of its Subsidiaries during your employment with the Company and any of its Subsidiaries.

(c) You agree that the Company’s substantial investments in its business interests, goodwill, and Confidential Information are worthy of protection, and that the Company’s need for the protection afforded by this Section 11 is greater than any hardship you might experience by complying with its terms. You further acknowledge and agree that the restrictions set forth in this Section are not adverse to the public interest. You further agree that the limitations as to time and scope of activity to be restrained contained herein are reasonable and are not greater than necessary to protect the Confidential Information, goodwill and other legitimate business interests of the Company. Although the Company and you believe the limitations as to time and scope of activity contained in this Section 11 are reasonable and do not impose a greater restraint than necessary to protect the Company’s legitimate business interests, if this is judicially determined not to be the case, the Company and you specifically request that the limitations contained in this Section be reformed to the extent necessary to make this Section 11 enforceable.

(d) You acknowledge and agree that your violation or threatened or attempted violation of the covenants contained in this Section 11 will cause irreparable harm to the Company and that money damages would not be sufficient remedy for any breach of this Section. You agree that the Company shall be entitled as a matter of right to specific performance of the covenants in this Section 11, including entry of an ex parte temporary restraining order in state or federal court, preliminary and permanent injunctive relief against activities in violation of this Section 11, or both, or other appropriate judicial remedy, writ or order, in any court of competent jurisdiction, restraining any violation or further violation of such agreements by you or others acting on your behalf, without any showing of irreparable harm and without any showing that the Company does not have an adequate remedy at law. Such remedies shall be in addition to all other remedies available to the Company at law and equity.

(e) Your obligations under this Section 11 shall survive the termination of this Agreement and your employment, regardless of the reason for such termination.

(f) As a part of your employment by the Company, and in further consideration for the granting of this Award and by your acceptance of this Award in whole or in part, you accept and agree to be bound by the Company’s Intellectual Property Policy (as the same may be modified, amended or replaced by the Company from time to time), including without limitation, (A) the Company’s ownership of the worldwide right, title and interest in and to any and all Pioneer Intellectual Property; (B) your agreement to assign, and pursuant to the Company’s Intellectual Property Policy and your acceptance of this Award you do hereby assign, to the Company all worldwide right, title and interest in and to all Pioneer Intellectual Property; and (C) your agreement to disclose in writing to the Company all Pioneer Intellectual Property and, upon request by the Company, to promptly produce and deliver to the Company all originals of materials embodying Pioneer Intellectual Property. The term, “Pioneer Intellectual Property,” is defined in the Company’s Intellectual Property Policy (and is incorporated herein by reference), and includes, without limitation, any and all creations, works and/or intellectual property (including but not limited to all tangible and intangible ideas and expressions of ideas whether or not the subject matter of copyright, confidential and non-confidential information, data, drawings, reports, programs, processes, analyses, business methods, computer programs, works of authorship, trademarks and service marks, improvements, discoveries and/or inventions whether or not patentable), and all of the intellectual property rights therein provided by the various legal systems throughout the world (including but not limited to trade secret rights, patent rights, trademark rights, and rights of copyright), that are conceived, created, made, invented, developed, reduced to practice, reduced to a tangible medium of expression, and/or acquired by you, individually or jointly with others, during the time of your employment relationship with the Company, that pertain to the actual or anticipated business or activities of the Company or that are suggested by or result from any task or work by you for or on behalf of the Company, irrespective whether you are or were hired-to-invent such creations, works or intellectual property, or whether such creations, works or intellectual property were conceived, created, made, invented, developed, reduced to practice, reduced to a tangible medium of expression or acquired in the course or scope of your employment, or whether at home or not, or whether or not during business hours, or whether or not using the Company’s time, facilities or resources. You may review the Company’s Intellectual Property Policy at the Company’s internal portal website, and obtain a copy by written request to the Company’s Legal Department.

12. Payment of Taxes . The Company may from time to time require you to pay to the Company (or the Company’s Subsidiary if you are an employee of a Subsidiary of the Company) the amount that the Company deems necessary to satisfy the Company’s or its Subsidiary’s current or future obligation to withhold federal, state or local income or other taxes or social security or other obligations that you incur as a result of this Award, including without limitation with respect to any payment pursuant to Section 2 of this Agreement. With respect to any required tax withholding, unless another arrangement is permitted by the Committee in its discretion (which discretion may not be delegated to management), the Company shall withhold from the shares of Stock to be issued to you the number of shares necessary to satisfy the Company’s obligation to withhold taxes, that determination to be based on the shares’ Fair Market Value at the time as of which such determination is made. In the event the Company subsequently determines that the aggregate Fair Market Value of any shares of Stock withheld as payment of any tax withholding obligation is insufficient to discharge that tax withholding obligation, then you shall pay to the Company, immediately upon the Company’s request, the amount of that deficiency.

13. Right of the Company and Subsidiaries to Terminate Employment . Nothing contained in this Agreement shall confer upon you the right to continue in the employ of the Company or any Subsidiary of the Company, or interfere in any way with the rights of the Company or any Subsidiary of the Company to terminate your employment at any time.

14. No Liability for Good Faith Determinations . Neither the Company nor the members of the Board and the Committee shall be liable for any act, omission or determination taken or made in good faith with respect to this Agreement or the Restricted Stock Units granted hereunder.

15. No Guarantee of Interests . The Board and the Company do not guarantee the Stock of the Company from loss or depreciation.

16. Company Records . Records of the Company or its Subsidiaries regarding your period of employment, termination of employment and the reason therefor, leaves of absence, re-employment, and other matters shall be conclusive for all purposes hereunder, unless determined by the Company to be incorrect.

17. Severability . If any provision of this Agreement is held to be illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions hereof, but such provision shall be fully severable and this Agreement shall be construed and enforced as if the illegal or invalid provision had never been included herein.

18. Notices . Whenever any notice is required or permitted hereunder, such notice must be in writing and personally delivered or sent by mail. Any such notice required or permitted to be delivered hereunder shall be deemed to be delivered on the date on which it is personally delivered, or, whether actually received or not, on the third Business Day after it is deposited in the United States mail, certified or registered, postage prepaid, addressed to the person who is to receive it at the address which such person has theretofore specified by written notice delivered in accordance herewith. The Company or you may change, at any time and from time to time, by written notice to the other, the address which it or he had previously specified for receiving notices.

The Company and you agree that any notices shall be given to the Company or to you at the following addresses:

Company: Pioneer Natural Resources Company

Attn: Corporate Secretary

5205 N. O’Connor Boulevard, Suite 200

Irving, Texas 75039-3746

Holder: At your current address as shown in the Company’s records.

19. Waiver of Notice . Any person entitled to notice hereunder may waive such notice in writing.

20. Successors . This Agreement shall be binding upon you, your legal representatives, heirs, legatees and distributees, and upon the Company, its successors and assigns.

21. Headings . The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof.

22. Governing Law . All questions arising with respect to the provisions of this Agreement shall be determined by application of the laws of the State of Delaware except to the extent Delaware law is preempted by federal law. The obligation of the Company to sell and deliver Stock hereunder is subject to applicable laws and to the approval of any governmental authority required in connection with the authorization, issuance, sale, or delivery of such Stock.

23. Execution of Receipts and Releases . Any payment of cash or any issuance or transfer of shares of Stock or other property to you, or to your legal representative, heir, legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be in full satisfaction of all claims of such Persons hereunder. The Company may require you or your legal representative, heir, legatee or distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it shall determine.

24. Amendment . This Agreement may be amended at any time unilaterally by the Company, provided that such amendment is consistent with all applicable laws and does not reduce any rights or benefits you have accrued pursuant to this Agreement. This Agreement may also be amended at any time unilaterally by the Company to the extent the Company believes in good faith that such amendment is necessary or advisable to bring this Agreement in compliance with any applicable laws, including the Nonqualified Deferred Compensation Rules.

25. The Plan . This Agreement is subject to all the terms, conditions, limitations and restrictions contained in the Plan; provided , however , that notwithstanding anything to the contrary herein, any provision of this Agreement that is inconsistent with the provisions of Section 9(c) and (e) of the Plan shall control over such provisions of the Plan.

26. Agreement Respecting Securities Act of 1933 . You represent and agree that you will not sell the Stock that may be issued to you pursuant to your Restricted Stock Units except

pursuant to an effective registration statement under the Securities Act of 1933 or pursuant to an exemption from registration under the Securities Act of 1933 (including Rule 144 of the Securities Act).

27. Special Provisions Addressing Section 409A of the Code .

(a) Early Tax Payments . To the extent permitted under the Nonqualified Deferred Compensation Rules, payments may be made to you in respect of this Award prior to the date of your scheduled payment dates herein if, as determined by the Committee in its sole discretion, it would be necessary to pay employment or other taxes imposed upon this Award prior to the scheduled payment date.

(b) Separate Payments . Each payment made under this Award, if any, shall be treated as a separate payment under the Nonqualified Deferred Compensation Rules.

28. Electronic Delivery and Acknowledgement . No signature by you is required to accept the Award represented by this Agreement. By your acceptance of this Award, you are acknowledging that you have received and read, understood and accepted all the terms, conditions and restrictions of this Agreement and the Plan. The Company may, in its sole discretion, deliver any documents related to this Award and this Agreement, or other awards that have been or may be awarded under the Plan, by electronic means, including prospectuses, proxy materials, annual reports and other related documents, and the Company may, in its sole discretion, engage a third party to effect the delivery of these documents on its behalf and provide other administrative services related to this Award and the Plan. By your acceptance of the Award represented by this Agreement, you consent to receive such documents by electronic delivery and to the engagement of any such third party.

Schedule I

The document to which this Schedule I is attached is the form of Restricted Stock Unit Award Agreement between the Company and Timothy L. Dove.

1. The form of Restricted Stock Unit Award Agreement between the Company and each of Mark S. Berg, Chris J. Cheatwood, Richard P. Dealy, J. D. Hall, Kenneth H. Sheffield, Jr., William F. Hannes, Frank E. Hopkins, Mark H. Kleinman, Teresa A. Fairbrook, and Stephanie D. Stewart varies from this form by modifying Section 6 to provide, in its entirety, as follows:

6. Termination of Employment .

(b) Termination Not For Cause; Good Reason; Death or Disability . Notwithstanding Section 4 of this Agreement, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date as a result of any of the following events:


(i)	by the Company and such Subsidiaries and such termination is not a Termination for Cause;


(ii)	by you and such termination is a Termination for Good Reason; or


(iii)	your death or Disability (defined below);

then the restrictions on a number of the Restricted Stock Units shall automatically lapse such that the number of Restricted Stock Units for which the restrictions have lapsed as of the termination date will be equal to the product of (x) the total number of Restricted Stock Units granted to you pursuant to this Agreement, times (y) a fraction, the numerator of which is the number of full months (counting the month in which your termination of employment occurs as a full month), beginning with March ______, during which you were employed by the Company and/or any Subsidiary and the denominator of which is 36 (the “ Pro-Rata Formula ”). The portion, if any, of your Restricted Stock Units for which the restrictions have not lapsed as of the termination date of your employment

relationship shall become null and void as of the termination date; provided , however , that the portion, if any, of this Award for which forfeiture restrictions have lapsed as of the date of termination shall survive.

Notwithstanding the forgoing, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date, but upon or following a Change in Control, (x) by the Company and such Subsidiaries and such termination is not a Termination for Cause, (y) by you and such termination is a Termination for Good Reason, or due to Forced Relocation, whether or not such termination is also in connection with a Change in Control, or (z) your death or Disability (as defined below), then all of the Restricted Stock Units granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted.

(c) Termination in Connection with Normal Retirement . Notwithstanding Section 4 of this Agreement, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date as a result of your Normal Retirement (defined below), then all of the Restricted Stock Units granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted upon your termination of employment if the following conditions are met (provided that the following conditions, other than item (i) below, shall not apply if your employment terminates upon or following a Change in Control): (x) as of the date of the termination of your employment, the conditions set forth below in items (i)-(iv) are satisfied and (y) you intend to comply with the covenants contained in items (v) and (vi) below (which intent shall be conclusively presumed unless, prior to or concurrently with the notice provided pursuant to item (ii) below, you notify the Company in writing, addressed to the Vice President and Chief Human Resources Officer (or his or her successor), that you do not intend to comply with such covenants).

(i)


(ii)	You gave advance written notice of your intent to terminate your employment due to Normal Retirement at least six months in advance of the date of termination to the Vice President and Chief Human Resources

Officer (or his or her delegate), and to your direct manager, or in the case of the chief executive officer of the Company, to the Board (subject to the ability of the Company to waive such requirement, exercisable by the Vice President and Chief Human Resources Officer (or his or her delegate) or the Board, as applicable).


(iii)	You have cooperated with the Company, to the satisfaction of the Company, in the training of a replacement during the period prior to the termination of employment.


(iv)	If required by the Company, you execute and deliver to the Company an effective release of claims and other liability in a form acceptable to the Company.

(v)

For two years following the termination of your employment, without the prior written consent of the chief executive officer of the Company, or in the event you are the chief executive officer of the Company on the date of termination of your employment, the consent of the Board or any Committee or director designated by the Board, you agree to refrain from becoming a director, partner, investor or employee of, or consultant to, any business that competes with the Company or any Subsidiary in the business of exploration or production of oil or natural gas, or related oilfield services, within the geographic area or areas in which the Company or any Subsidiary operates at the time of termination of employment or has operated in the immediately preceding one-year period (a “ Competitive Business ”); provided that, you will not be restricted from purchasing or holding for investment purposes less than 2% of the shares of any Competitive Business whose shares are regularly traded on a national securities exchange or inter-dealer quotation system. If the Company so requires prior to the date of termination of employment, the Company may require that you execute a separate agreement to effect the intent of the foregoing.

(vi)

Agreement. In the event that, following your termination of employment, it is determined by a court of competent jurisdiction that you have not satisfied any of the conditions set forth in Section 6(c)(v) or (vi) in any material respect, then, as to any shares of Stock related to your Restricted Stock Units that have not been paid to you, such Restricted Stock Units shall be deemed not to have vested in whole or in part pursuant to any paragraph of this Section 6 and such shares shall not be payable. Notwithstanding the foregoing, in the event there occurs a Change in Control, whether prior to or after the date that the restrictions on your Restricted Stock Units have lapsed or the payment date of any Stock related to your Restricted Stock Units, the restrictions set forth in clauses (v) and (vi) of this Section 6(c) shall automatically terminate and become void and of no effect.

(d) Distribution and Payment . Upon termination of your employment relationship with the Company and each of its Subsidiaries as a result of your death, the shares of Stock related to your Restricted Stock Units that become vested pursuant to paragraph (b) of this Section 6 shall be paid to you immediately (and in no event later than 30 days) following your death. Upon termination of your employment relationship with the Company and each of its Subsidiaries under all other circumstances contemplated by paragraphs (b) and (c) of this Section 6 (“ Section 6 Acceleration Events ”), the following shall apply:


(i)	If you are not a Section 409A Participant (as defined below), the shares of Stock related to your Restricted Stock Units that become vested pursuant to such paragraphs shall be paid to you immediately (and in no event later than 30 days) following the termination of your employment relationship with the Company and each of its Subsidiaries.

(ii)

(A) the Vesting Date; or

(B) your death.

(iii)

(A) the Vesting Date;


(B)	the date that is six months and one day following the date of your separation from service with the Company (determined in accordance with the Company’s written and generally applicable policies regarding what constitutes a “separation from service” within the meaning of the Nonqualified Deferred Compensation Rules ) (“ Separation from Service ”); or

2. The form of form of Restricted Stock Unit Award Agreement between the Company and Margaret M. Montemayor varies from this form as follows:

A. Sections 5, 6 and 7 are modified to read in their entirety as follows:

5. Change in Control of the Company . Notwithstanding Section 4 of this Agreement, upon the occurrence of a Change in Control, all of the Restricted Stock Units granted pursuant to this Agreement shall become immediately and unconditionally vested, and the shares of Stock related to such Restricted Stock Units shall be paid to you immediately (and in no event later than 30 days) following the Change in Control; provided , however , that if (i) you would attain age 60 on or prior to December 31, ______ (a “ Section 409A Participant ”), and (ii) the event constituting a Change in Control does not constitute a “change in the ownership or effective control” or “in the ownership of a substantial portion of the assets” of the Company within the meaning of Section 409A of the Code (a “ 409A Change in Control ’) and the regulations and other authoritative guidance promulgated thereunder (collectively, the “ Nonqualified Deferred Compensation Rules ”), distribution in respect of your Restricted Stock Units that become vested pursuant to this Section 5 shall be made to you at the earliest to occur of (i) the Vesting Date, (ii) the date that is six months and one day following your separation from service with the Company (determined in accordance with the Company’s written and generally applicable policies regarding what constitutes a “separation from service” for purposes of the Nonqualified Deferred Compensation Rules) (“ Separation from Service ”), (iii) the occurrence of a 409A Change in Control or (iv) your death.

6. Termination of Employment .


(i)	by the Company and such Subsidiaries and such termination is not a Termination for Cause;


(ii)	by you and such termination is a Termination for Good Reason; or


(iii)	your death or Disability (defined below);

For purposes of this Agreement, “ Disability ” shall have the meaning given such term in the Severance Agreement between you and the Company or one of its Subsidiaries; provided, however, that if there is no such agreement at the time of such termination, the term Disability shall mean (i) a physical or mental impairment of sufficient severity that, in the opinion of the Company, (A) you are unable to continue performing the duties assigned to you prior to such impairment or (B) your condition entitles you to disability benefits under any insurance or employee benefit plan of the Company or its Subsidiaries and (ii) the impairment or condition is cited by the Company as the reason for your termination; provided further, that in all cases, the term Disability shall be applied and interpreted in compliance with Section 409A of the Code and the regulations thereunder.

shall become immediately and unconditionally vested and unrestricted upon your termination of employment if as of the date of the termination of your employment, the conditions set forth below in items (i)-(iv) are satisfied.

(i)

(ii)


(iii)	You have cooperated with the Company, to the satisfaction of the Company, in the training of a replacement during the period prior to the termination of employment.


(iv)	If required by the Company, you execute and deliver to the Company an effective release of claims and other liability in a form acceptable to the Company.


(i)	If you are not a Section 409A Participant, the shares of Stock related to your Restricted Stock Units that become vested pursuant to such paragraphs shall be paid to you immediately (and in no event later than 30 days) following the termination of your employment relationship with the Company and each of its Subsidiaries.


(ii)	If you are a Section 409A Participant, the applicable shares shall be paid to you immediately (and in no event later than 30 days) following the earliest to occur of the following:

(A) the Vesting Date;


(B)	the date that is six months and one day following the date of your Separation from Service;

(D) your death.

7. [RESERVED]

B. Paragraph (b) of Section 11 is modified to read in its entirety as follows:

(b) As an incentive for the Company to issue you this Award, and in consideration of the Company’s promise to provide you with Confidential Information and so as to protect the Company’s legitimate business interests, including the protection of its Confidential Information and the goodwill with which you will be associated, and that this Award will encourage you to build, you agree that during your employment relationship with the Company and each of its Subsidiaries by which you are employed, and for a period of twelve (12) months immediately following the time that you are no longer employed by the Company or any of its Subsidiaries, you will not, directly or indirectly (i) solicit or encourage (or assist another in soliciting or encouraging) any employee, contractor, consultant, supplier, or vendor of the Company or any of its Subsidiaries to terminate or lessen his, her or its relationship with the Company or any of its Subsidiaries, or (ii) on behalf of a Competitive Business, engage, employ, or solicit or contact for employment or engagement (or assist another in such activity) any employee of the Company or any of its Subsidiaries or any person who was an employee of the Company or any of its Subsidiaries at any time during the last twelve (12) months of your employment with the Company and any of its Subsidiaries (or, if you are employed by the Company and any of its Subsidiaries for less than twelve (12) months, those persons who were employees of the Company or any of its Subsidiaries during your employment with the Company and any of its Subsidiaries. For purposes of this Agreement, “ Competitive Business ” means any business that competes with the Company or any Subsidiary in the business of exploration or production of oil or natural gas, or related oilfield services, within the geographic area or areas in which the Company or any Subsidiary operates at the time of termination of employment or has operated in the immediately preceding one-year period.

Exhibit 10.4

RESTRICTED STOCK AWARD AGREEMENT

PIONEER NATURAL RESOURCES COMPANY
AMENDED AND RESTATED 2006 LONG TERM INCENTIVE PLAN

[Date]

To: [Name]

Pioneer Natural Resources Company, a Delaware corporation (the " Company "), is pleased to grant you an award (this " Award ") to receive an aggregate of ________ shares (the “ Restricted Shares ”) of common stock, par value $0.01, of the Company (the “ Stock ”). This Award is subject to certain restrictions and all the terms, conditions and restrictions contained in this Restricted Stock Award Agreement (the “ Agreement ”) and the Pioneer Natural Resources Company Amended and Restated 2006 Long Term Incentive Plan (the “ Plan ”). A copy of the Plan is available upon request. Except as provided below, to the extent that any provision of this Agreement conflicts with the expressly applicable terms of the Plan, you acknowledge and agree that those terms of the Plan shall control and, if necessary, the applicable provisions of this Agreement shall be deemed amended so as to carry out the purpose and intent of the Plan. Terms that have their initial letters capitalized, but that are not otherwise defined in this Agreement, shall have the meanings given to them in the Plan in effect as of the date of this Agreement.

This Agreement sets forth the terms of the agreement between you and the Company with respect to the Restricted Shares. By accepting this Agreement, you agree to be bound by all of the terms hereof.

1. Escrow of Restricted Shares . The Company shall, at its sole election, either issue in your name a certificate for the Restricted Shares and retain that certificate for the period during which the restrictions described in Section 3 are in effect, or issue the Restricted Shares in your name electronically and control the Restricted Shares electronically during the period of restriction. You shall, if requested, execute and deliver to the Company a stock power in blank for the Restricted Shares and deliver such stock power to the Company. You hereby agree that the Company shall hold the certificate for, or control electronically, the Restricted Shares and the related stock power pursuant to the terms of this Agreement until such time as the restrictions described in Section 3 lapse as described in Sections 4, 5, 6 and 7, or the Restricted Shares are cancelled pursuant to the terms of Section 3.

2. Ownership of Restricted Shares . From and after the time that a certificate (electronic or otherwise) has been issued in your name, you are entitled to all the rights of absolute ownership of the Restricted Shares, including the right to vote those shares and to receive dividends

thereon if, as and when declared by the Board subject, however, to the terms, conditions and restrictions described in the Plan and in this Agreement.

3. Restrictions . The Restricted Shares are restricted in that they may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of until such restrictions are removed or expire as described in Section 4, 5, 6 or 7 of this Agreement. The Restricted Shares are also restricted in the sense that they may be forfeited to the Company. You hereby agree that if the Restricted Shares are forfeited as provided in Section 6, you shall forfeit the Restricted Shares to the Company and all your rights thereto shall terminate without any payment of consideration by the Company. You hereby acknowledge that if issued, the certificate for the Restricted Shares, at the Company’s sole discretion, may bear a legend noted conspicuously thereon referring to the terms, conditions, and restrictions described in the Plan and in this Agreement. Any attempt to dispose of any Restricted Shares in contravention of the terms, conditions and restrictions described in the Plan or in this Agreement shall be ineffective.

4. Expiration of Restrictions and Risk of Forfeiture . Subject to the terms and conditions of this Agreement, the restrictions described in Section 3 shall lapse in full on the third anniversary of the date of this Agreement (the “ Vesting Date ”); provided, however, that such restrictions will expire on the Vesting Date only if you have been an employee of the Company or of a Subsidiary continuously from the date of this Agreement through the Vesting Date; provided, further, however, that if you cease to be an employee of the Company or of a Subsidiary for any reason after the Vesting Date, all Restricted Shares granted pursuant to this Agreement will survive the termination of employment.

5. [RESERVED]

6. Termination of Employment .

(a) Termination By Employee Without Good Reason . Except as otherwise provided in this Agreement, if your employment relationship with the Company or any of its Subsidiaries is terminated voluntarily by you prior to the Vesting Date and such termination is not a Termination for Good Reason (as such term is defined in the Termination Agreement (as defined below)) or due to Forced Relocation (as such term is defined in the Termination Agreement, if applicable), then all Restricted Shares granted pursuant to this Agreement shall become null and void as of the date of such termination. For purposes of this Agreement, “ Termination Agreement ” means, prior to the occurrence of a Change in Control, the Severance Agreement or other separate agreement between you and the Company and/or any of its subsidiaries relating to the provision of severance and other benefits before a Change in Control and, upon and following the occurrence of a Change in Control, the Change in Control Agreement or other separate agreement between you and the Company and/or any of its subsidiaries relating to the provision of severance and other benefits upon or after a Change in Control.

(b) Termination By The Company For Cause . If your employment relationship with the Company or any of its Subsidiaries is terminated by the Company prior to the Vesting Date and such termination is a Termination for Cause (as such term is defined in the

Termination Agreement), then all Restricted Shares granted pursuant to this Agreement shall become null and void as of the date of termination.

(c) Other Termination Events . If your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date as a result of any of the following events:

(i) your death;

(ii) your Disability;

(iii) your Normal Retirement;

(iv) a termination by you that is a Termination for Good Reason; or

(v) a termination by the Company that is not a Termination for Cause,

then the restrictions on a number of Restricted Shares shall automatically lapse such that the number of Restricted Shares for which the restrictions have lapsed as of the termination date will be equal to the product of (i) the total number of Restricted Shares granted to you pursuant to this Agreement, times (ii) a fraction, the numerator of which is the number of full months (counting the month in which your termination of employment occurs as a full month), beginning with March ______, during which you were employed by the Company and/or any Subsidiary and the denominator of which is 36 (the “ Pro-Rata Formula ”); provided that, in the case of Normal Retirement, all of the Restricted Shares granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted and shall not be so pro rated. The portion, if any, of your Restricted Shares for which the restrictions have not lapsed as of the termination date of your employment relationship shall become null and void as of the termination date; provided, however, that the portion, if any, of this Award for which forfeiture restrictions have lapsed as of the date of termination shall survive.

Notwithstanding the forgoing, if your employment relationship with the Company and each of its Subsidiaries by which you are employed is terminated prior to the Vesting Date, but upon or following a Change in Control, (x) by the Company and such Subsidiaries and such termination is not a Termination for Cause, (y) by you and such termination is a Termination for Good Reason, or due to Forced Relocation, whether or not such termination is also in connection with a Change in Control, or (z) your death or Disability (as defined below), then all of the Restricted Shares granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted.

For purposes of this Agreement, (x) “ Disability ” shall have the meaning given such term in the Termination Agreement; provided, however, that if there is no such agreement at the time of such termination, the term Disability shall mean (i) a physical or mental impairment of sufficient severity that, in the opinion of the Company, (A) you are unable to continue performing the duties assigned to you prior to such impairment or (B) your condition entitles you to disability benefits under any insurance or employee benefit plan of the Company or its Subsidiaries and (ii) the impairment or condition is cited by the Company as the reason for your termination; (y) “ Normal Retirement ”

means the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed due to your retirement on or after the date that you attain age 60, provided that you have completed five Years of Service as of the date of such termination, subject to paragraph (d) of this Section 6; and (z) “ Years of Service ” means the total number of years that you have been employed by the Company or its Subsidiaries as determined in accordance with the Company’s policies as administered from time to time. For the avoidance of doubt, the Company’s determination of Years of Service shall be at the sole discretion of the Company, its policies may change from time to time, and its determination will be final and conclusive and binding on all Participants.

(d) Conditions Applicable to Normal Retirement . In order for the restrictions on your Restricted Shares to lapse in the case of Normal Retirement pursuant to Section 6(c), the following conditions shall be met (provided that such conditions, other than item (i) below, shall not apply if your employment terminates upon or following a Change in Control): (x) as of the date of the termination of your employment, the conditions set forth below in items (i)-(iv) are satisfied and (y) you intend to comply with the covenants contained in items (v) and (vi) below (which intent shall be conclusively presumed unless, prior to or concurrently with the notice provided pursuant to item (ii) below, you notify the Company in writing, addressed to the Vice President and Chief Human Resources Officer (or his or her successor), that you do not intend to comply with such covenants).

(i)

The date of the termination of your employment is at least one year after the date of this Agreement (but if not, instead of all of the Restricted Shares granted pursuant to this Agreement becoming immediately and unconditionally vested and unrestricted, restrictions on a number of Restricted Shares shall automatically lapse such that the number of Restricted Shares for which the restrictions have lapsed as of the termination date will be equal to the product of (x) the total number of Restricted Shares granted to you pursuant to this Agreement, times (y) the Pro-Rata Formula).

(ii)


(iii)	You have cooperated with the Company, to the satisfaction of the Company, in the training of a replacement during the period prior to the termination of employment.


(iv)	If required by the Company, you execute and deliver to the Company an effective release of claims and other liability in a form acceptable to the Company.

(v)

(vi)

You expressly acknowledge and agree that the restrictions set forth in clauses (v) and (vi) of this Section 6(d) are reasonable in all respects, necessary to protect the Company’s legitimate business interests and a material inducement for the Company to grant this Award to you and enter into this Agreement. In the event that, following your termination of employment, it is determined by a court of competent jurisdiction that you have not satisfied any of the conditions set forth in Section 6(d)(v) or (vi) in any material respect, then, any Restricted Shares as to which the restrictions have not lapsed shall become null and void. Notwithstanding the foregoing, in the event there occurs a Change in Control, whether prior to or after the date that the restrictions on your Restricted Shares have lapsed, the restrictions set forth in clauses (v) and (vi) of this Section 6(c) shall automatically terminate and become void and of no effect.

7. Awards Not Assumed in Connection with a Change in Control. In the event that this Award is not Assumed (as defined below) in connection with a Change in Control, then all of

the Restricted Shares granted pursuant to this Agreement shall become immediately and unconditionally vested and unrestricted immediately prior to the Change in Control. For purposes of this Agreement, the term, “ Assumed ,” means that, prior to or concurrently with the consummation of the transaction resulting in a Change in Control, either (i) this Agreement is expressly affirmed by the Company or (ii) the contractual obligations represented by this Agreement are expressly (and not merely by operation of law) assumed by the surviving or successor corporation or entity to the Company, or any parent or subsidiary of either thereof, or any other corporation or entity that is a party to the transaction resulting in the Change in Control, in connection with such Change in Control, with appropriate adjustments to the number and kind of securities of such surviving or successor corporation or entity, or such other applicable parent, subsidiary, corporation or entity, subject to this Award, which preserves the compensation element of this Agreement existing at the time of such Change in Control, and provides for subsequent payout in accordance with the same (or more favorable) payment and vesting schedule applicable to this Award, as determined in accordance with the instruments evidencing the agreement to assume this Agreement; provided, however, that in no event will this Agreement be deemed to be “Assumed” unless the assumption is made by the entity that will be the issuer of the securities, cash or other property provided in exchange for Common Stock in the Change in Control transaction in question. The determination of comparability for this purpose shall be made by the Committee prior to the Change in Control, and its determination shall be final, binding and conclusive.

8. Adjustment Provisions . In the event there is any change in the Stock by reason of any reorganization, recapitalization, stock split, stock dividend, combination of shares or otherwise, the number of shares associated with this Award of Restricted Shares subject to this Agreement shall be adjusted in the manner consistent with the adjustment provisions provided in Section 9(b) and 9(c)(ii) of the Plan. Unless otherwise determined by the Committee, Stock distributed in connection with a stock split or stock dividend shall be subject to restrictions and a risk of forfeiture to the same extent as the Restricted Shares with respect to which such Stock has been distributed.

9. Delivery of Stock . Promptly following the expiration of the restrictions on the Restricted Shares as contemplated in Sections 4, 5, 6 and 7 of this Agreement, the Company shall cause to be issued and delivered to you or your designee a certificate (which may be in electronic or book entry form, as determined by the Company in its discretion) representing the number of Restricted Shares as to which restrictions have lapsed, free of any restrictive legend relating to the lapsed restrictions, upon receipt by the Company of any tax withholding as may be requested. The value of such Restricted Shares shall not bear any interest owing to the passage of time.

12. Confidential Information and Nonsolicitation .

(a) As further consideration for the granting of the Restricted Shares hereunder, you hereby agree with the Company that, during and until three years following the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed, you will keep confidential all confidential or proprietary information and materials, as well as all trade secrets, belonging to the Company or one of its Subsidiaries, or their customers or other third parties who furnished such information, materials, and/or trade secrets to the Company or its Subsidiary with expectations of confidentiality (“ Confidential Information ”). Confidential Information shall not include information that (A) is already properly in the public domain or enters the public domain with the express consent of the Company, or (B) is intentionally made available by the Company to third parties without any expectation of confidentiality. Upon the termination of your employment relationship with the Company and each of its Subsidiaries by which you are employed, you promise to promptly return to the Company all Confidential Information, and all documents and materials (including electronically stored information) in your possession, custody or control that constitutes or reflects Confidential Information. Notwithstanding the foregoing, you may disclose information as may be required by law and may disclose information in confidence to your spouse, tax and financial advisors, or to a financial institution to the extent that such information is necessary to secure a loan, provided that you ensure that such spouse or advisor or institution treats the information confidentially and does not disclose such information or use it for his, her or its own benefit. In the event any breach of this promise comes to the attention of the Company, it shall take into consideration that breach in determining whether to recommend the grant of any future similar award to you, as a factor militating against the advisability of granting any such future award to you. Such consideration shall be in addition to the rights and remedies available to the Company pursuant to paragraph (d) below. Notwithstanding any other provision of this Agreement, you will not be held criminally or civilly liable under any federal or state trade secret law for any disclosure of a trade secret that (a) is made: (1) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (2) solely for the purpose of reporting or investigating a suspected violation of law, or (b) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. In addition, if you file a lawsuit for retaliation, you may disclose the Company’s trade secrets to your attorney and use the trade secret information in the court proceeding if you: (a) file any document containing the trade secret under seal, and (b) do not disclose the trade secret, except pursuant to court order.

(or assist another in such activity) any employee of the Company or any of its Subsidiaries or any person who was an employee of the Company or any of its Subsidiaries at any time during the last twelve (12) months of your employment with the Company and any of its Subsidiaries (or, if you are employed by the Company and any of its Subsidiaries for less than twelve (12) months, those persons who were employees of the Company or any of its Subsidiaries during your employment with the Company and any of its Subsidiaries).

(e) Your obligations under this Section shall survive the termination of this Agreement and your employment, regardless of the reason for such termination.

Pioneer Intellectual Property. The term, “Pioneer Intellectual Property,” is defined in the Company’s Intellectual Property Policy (and is incorporated herein by reference), and includes, without limitation, any and all creations, works and/or intellectual property (including but not limited to all tangible and intangible ideas and expressions of ideas whether or not the subject matter of copyright, confidential and non-confidential information, data, drawings, reports, programs, processes, analyses, business methods, computer programs, works of authorship, trademarks and service marks, improvements, discoveries and/or inventions whether or not patentable), and all of the intellectual property rights therein provided by the various legal systems throughout the world (including but not limited to trade secret rights, patent rights, trademark rights, and rights of copyright), that are conceived, created, made, invented, developed, reduced to practice, reduced to a tangible medium of expression, and/or acquired by you, individually or jointly with others, during the time of your employment relationship with the Company, that pertain to the actual or anticipated business or activities of the Company or that are suggested by or result from any task or work by you for or on behalf of the Company, irrespective whether you are or were hired-to-invent such creations, works or intellectual property, or whether such creations, works or intellectual property were conceived, created, made, invented, developed, reduced to practice, reduced to a tangible medium of expression or acquired in the course or scope of your employment, or whether at home or not, or whether or not during business hours, or whether or not using the Company’s time, facilities or resources. You may review the Company’s Intellectual Property Policy at the Company’s internal portal website, and obtain a copy by written request to the Company’s Legal Department.

13. Payment of Taxes . The Company may from time to time require you to pay to the Company (or the Company's Subsidiary if you are an employee of a Subsidiary of the Company) the amount that the Company deems necessary to satisfy the Company's or its Subsidiary's current or future obligation to withhold federal, state or local income or other taxes or social security or other obligations that you incur as a result of this Award. With respect to any required tax withholding, unless another arrangement is permitted by the Committee in its discretion, the Company shall withhold from the shares of Stock to be issued to you the number of shares necessary to satisfy the Company's obligation to withhold taxes, that determination to be based on the shares' Fair Market Value at the time as of which such determination is made. In the event the Company subsequently determines that the aggregate Fair Market Value of any shares of Stock withheld as payment of any tax withholding obligation is insufficient to discharge that tax withholding

obligation, then you shall pay to the Company, immediately upon the Company's request, the amount of that deficiency.

16. No Guarantee of Interests . The Board and the Company do not guarantee the Stock of the Company from loss or depreciation.

The Company and you agree that any notices shall be given to the Company or to you at the following addresses:


Company:	Pioneer Natural Resources Company Attn: Corporate Secretary 5205 N. O’Connor Boulevard, Suite 200 Irving, Texas 75039-3746


Holder:	At your current address as shown in the Company's records.

20. Waiver of Notice . Any person entitled to notice hereunder may waive such notice in writing.

21. Successors . This Agreement shall be binding upon you, your legal representatives, heirs, legatees and distributees, and upon the Company, its successors and assigns.

22. Headings . The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof.

23. Governing Law . All questions arising with respect to the provisions of this Agreement shall be determined by application of the laws of the State of Delaware except to the extent Delaware law is preempted by federal law. The obligation of the Company to sell and deliver Stock hereunder is subject to applicable laws and to the approval of any governmental authority required in connection with the authorization, issuance, sale, or delivery of such Stock.

24. Execution of Receipts and Releases . Any payment of cash or any issuance or transfer of shares of Stock or other property to you, or to your legal representative, heir, legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be in full satisfaction of all claims of such Persons hereunder. The Company may require you or your legal representative, heir, legatee or distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it shall determine.

25. Amendment . This Agreement may be amended at any time unilaterally by the Company, provided that such amendment is consistent with all applicable laws and does not reduce any rights or benefits you have accrued pursuant to this Agreement. This Agreement may also be amended at any time unilaterally by the Company to the extent the Company believes in good faith that such amendment is necessary or advisable to bring this Agreement in compliance with any applicable laws, including Section 409A of the Code.

27. Agreement Respecting Securities Act of 1933 . You represent and agree that you will not sell the Stock that may be issued to you pursuant to your Restricted Shares except pursuant to an effective registration statement under the Securities Act of 1933 or pursuant to an exemption from registration under the Securities Act of 1933 (including Rule 144 of the Securities Act ).

consent to receive such documents by electronic delivery and to the engagement of any such third party.

EXHIBIT 12.1



RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS

The following table sets forth the Company's ratios of consolidated earnings to fixed charges and earnings to fixed charges and preferred stock dividends for the periods presented:



	Three Months Ended	Year ended December 31,
	March 31, 2018	2017	2016	2015	2014	2013
Ratio of earnings to fixed charges (a)	6.73	2.84	(b)	(c)	9.45	(d)
Ratio of earnings to fixed charges and preferred stock dividends (e)	6.73	2.84	(b)	(c)	9.45	(d)

____________________



(a)	The ratio has been computed by dividing earnings by fixed charges. For purposes of computing the ratio:

	- earnings consist of income from continuing operations before income taxes, cumulative effect of change in accounting principle, adjustments for net income or loss attributable to the noncontrolling interest and the Company's share of investee's income or loss accounted for under the equity method, and adjustment for capitalized interest, plus fixed charges and the Company's share of distributed income from investees accounted for under the equity method; and

	- fixed charges consist of interest expense, capitalized interest and the portion of rental expense deemed to be representative of the interest component of rental expense.

(b)	The ratio indicates a less than one-to-one coverage because the earnings are inadequate to cover the fixed charges during the year ended December 31, 2016 by $963 million.

(c)	The ratio indicates a less than one-to-one coverage because the earnings are inadequate to cover the fixed charges during the year ended December 31, 2015 by $432 million.

(d)	The ratio indicates a less than one-to-one coverage because the earnings are inadequate to cover the fixed charges during the year ended December 31, 2013 by $606 million.

(e)	The ratio has been computed by dividing earnings by fixed charges and preferred stock dividends. For purposes of computing the ratio:

	- earnings consist of income from continuing operations before income taxes, cumulative effect of change in accounting principle, adjustments for net income or loss attributable to the noncontrolling interest and the Company's share of investee's income or loss accounted for under the equity method, and adjustment for capitalized interest, plus fixed charges, the Company's share of distributed income from investees accounted for under the equity method and preferred stock dividends, net of preferred stock dividends of a consolidated subsidiary; and

	- fixed charges and preferred stock dividends consist of interest expense, capitalized interest and the portion of rental expense deemed to be representative of the interest component of rental expense, preferred stock dividends of a consolidated subsidiary and preferred stock dividends.

EXHIBIT 31.1

CHIEF EXECUTIVE OFFICER CERTIFICATION

I, Timothy L. Dove, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of Pioneer Natural Resources Company;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 4, 2018

/s/ Timothy L. Dove

Timothy L. Dove, President and Chief Executive Officer

EXHIBIT 31.2

CHIEF FINANCIAL OFFICER CERTIFICATION

I, Richard P. Dealy, certify that:


1.	I have reviewed this quarterly report on Form 10-Q of Pioneer Natural Resources Company;


2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):


(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 4, 2018

/s/ Richard P. Dealy

Richard P. Dealy, Executive Vice President

and Chief Financial Officer

EXHIBIT 32.1

CERTIFICATION OF

CHIEF EXECUTIVE OFFICER

OF PIONEER NATURAL RESOURCES COMPANY

PURSUANT TO 18 U.S.C. § 1350

I, Timothy L. Dove, President and Chief Executive Officer of Pioneer Natural Resources Company (the “Company”), hereby certify that the accompanying Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2018 and filed with the Securities and Exchange Commission pursuant to Section 13(a) of the Securities Exchange Act of 1934 (the “Report”) by the Company fully complies with the requirements of that section.

I further certify that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



		/s/ Timothy L. Dove
Name:		Timothy L. Dove, President and
		Chief Executive Officer
Date:		Date: May 4, 2018

EXHIBIT 32.2

CERTIFICATION OF

CHIEF FINANCIAL OFFICER

OF PIONEER NATURAL RESOURCES COMPANY

PURSUANT TO 18 U.S.C. § 1350

I, Richard P. Dealy, Executive Vice President and Chief Financial Officer of Pioneer Natural Resources Company (the “Company”), hereby certify that the accompanying Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2018 and filed with the Securities and Exchange Commission pursuant to Section 13(a) of the Securities Exchange Act of 1934 (the “Report”) by the Company fully complies with the requirements of that section.

I further certify that the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



		/s/ Richard P. Dealy
Name:		Richard P. Dealy, Executive Vice
		President and Chief Financial Officer
Date:		Date: May 4, 2018

EXHIBIT 95.1

Mine Safety Disclosure

The following disclosures are provided pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act") and Item 104 of Regulation S-K, which requires certain disclosures by companies required to file periodic reports under the Securities Exchange Act of 1934, as amended, that operate mines regulated under the Federal Mine Safety and Health Act of 1977 (the "Mine Act").

Whenever the Federal Mine Safety and Health Administration ("MSHA") believes a violation of the Mine Act, any health or safety standard or any regulation has occurred, it may issue a citation which describes the alleged violation and fixes a time within which the U.S. mining operator must abate the alleged violation. In some situations, such as when MSHA believes that conditions pose a hazard to miners, MSHA may issue an order removing miners from the area of the mine affected by the condition until the alleged hazards are corrected. When MSHA issues a citation or order, it generally proposes a civil penalty, or fine, as a result of the alleged violation, that the operator is ordered to pay. Citations and orders can be contested and appealed, and as part of that process, are often reduced in severity and amount, and are sometimes dismissed. The number of citations, orders and proposed assessments vary depending on the size and type (underground or surface) of the mine as well as by the MSHA inspector(s) assigned.

The table below sets forth for the three months ended September 30, 2017 for each sand mine of Pioneer Natural Resources Company or its subsidiaries (the "Company"), (i) the total number of citations for violations of mandatory health or safety standards that could significantly and substantially contribute to the cause and effect of mine safety or health hazard under section 104 of the Mine Act for which the operator received a citation from MSHA; (ii) the total number of orders issued under section 104(b) of the Mine Act; (iii) the total number of citations and orders for unwarrantable failure of the mine operator to comply with mandatory health or safety standards under section 104(d) of the Mine Act; (iv) the total number of flagrant violations under section 110(b)(2) of the Mine Act; (v) the total number of imminent danger orders issued under section 107(a) of the Mine Act; (vi) the total dollar value of proposed assessments from MSHA; (vii) the total number of mining-related fatalities; (viii) whether or not the mine has received any notices from MSHA of a pattern of violations of mandatory health or safety standards that are of such nature as could have significantly and substantially contributed to the cause and effect of mine health or safety hazards under section 104(e) of the Mine Act; (ix) whether or not the mine has received any notices from MSHA regarding the potential to have a pattern of violations as referenced in (viii) above; and (x) the total number of pending legal actions before the Federal Mine Safety and Health Review Commission (the "Commission") (as of September 30, 2017) involving such mine, as well as the aggregate number of legal actions instituted and the aggregate number of legal actions resolved during the reporting period. The MSHA citations, orders and assessments are those initially issued or proposed by MSHA. They do not reflect any subsequent changes in the level of severity of a citation or order or the value of an assessment that may occur as a result of proceedings conducted in accordance with MSHA rules.



Mine/MSHA Identification Number(1)	Section 104 S&S Citations	Section 104(b) Orders	Section 104(d) Citations and Orders	Section 110(b)(2) Violations	Section 107(a) Orders	Total Dollar Value of Proposed Assessments		Mining Related Fatalities	Received Notice of Pattern of Violations under Section 104(e) (yes/no)	Received Notice of Potential to have Pattern under Section 104(e) (yes/no)	Legal Actions Pending as of Last Day of Period	Legal Actions Initiated During Period	Legal Actions Resolved During Period
Voca Pit and Plant / 4101003	4	—	—	—	—	$	516	—	No	No	—	—	—
Brady Plant / 4101371	3	—	—	—	—	$	387	—	No	No	—	—	—
Voca West / 4103618	2	—	—	—	—	$	258	—	No	No	—	—	—

_______________



(1	)	The definition of mine under section three of the Mine Act includes the mine, as well as other items used in, or to be used in, or resulting from, the work of extracting minerals, such as land, structures, facilities, equipment, machines, tools and minerals preparation facilities. Unless otherwise indicated, any of these other items associated with a single mine have been aggregated in the totals for that mine. MSHA assigns an identification number to each mine and may or may not assign separate identification numbers to related facilities such as preparation facilities.