NOG - Earnings call transcript Q1 2022 | Northern Oil and Gas, Inc.

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Operator

Greetings, and welcome to the NOG First Quarter 2022 Earnings Call and Webcast. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder this conference is being recorded. It's now my pleasure to turn the call over to Mike Kelly, Chief Strategy Officer. sir. ahead, go Please

Michael Kelly

quarter. thank earnings joining the conference our the we and first market for quarter released first for results XXXX call. financial you morning, us for NOG's closed, Good Yesterday after

website You can access few SEC Form earnings release days. the we with the and Investor filed on XX-Q in our our our Relations next

President, Chad with the I'm joined night. and also a NOG's Nick and Jim We CEO, last Chief posted CFO, new Evans. website investor Adam O'Grady; EVP our our this Allen; deck morning Dirlam; on Engineer, here

Chad to review follows: and Our comments agenda team for Nick conclusion will and After the will Nick, today's will first an our financials give us call QX any our questions. answer our his our to is overview guidance. of then prepared with will the strategy; our after as Adam updates of our off your quarter business start be regarding you operations; remarks, executive XXXX and available of

update on statements. statements. We our the include, among our Annual any going Harbor risks meaning that with Litigation reports actual Form language, we in cover materially our on that these including others, results Those include our please described forward-looking as our to earnings the disclaim questions forward-looking These the Securities release XX-K Act. different cause Report further forward-looking from well are statements of the forward-looking by XX-Q. and to Including risks Safe statements the and obligation expectations the that may Private have advised remarks today, within as our me quarterly Reform be though, these SEC. contemplated subject Form could Before to answers filings your matters let uncertainties be to in

free found turn call Nick the GAAP may to that we earnings can financial be we our issued of flow. net EBITDA, adjusted over adjusted I call, measures, in would income O'Grady. measures conference measures the the to to non-GAAP certain closest like including this cash morning. discuss and Reconciliations our During these release now CEO,

Nicholas O'Grady

Good morning call. everyone in today's thanks participating and for

X% we'll generated for focusing $XXX.X one, was cash monstrous generated million Number points. our day Boe adjusted million QX XXXX Veritas We in forecast ahead by months this, $XXX in double received breaker NOG. a flow. a line with than quarter about in and result earlier XXXX. slight of of During on over contribution And of that had completions better expected free we free in than internal six two XX,XXX as being we of we a a the Production also record few Despite first of We is spending. schedule. over That this call March key included from production. produced only performance. cash just a beat per were this one flow more QX quarter EBITDA well

prior better our cash greater and Number increasing to $XXX target year the better million for are We production consistent two, pricing. from million $XXX realized flow free on than outperformance.

acquirer. performing And integrated deals and our expected. time on disciplined better we and proven have they're a are We successfully than XXXX

three, seeing on As the we assets shine. continues we assumptions assets. properties. to utilize the our in conference call, last conservative our model on we timing And anticipated, especially development we than diversified mentioned on are quarter's are acquiring production and Veritas more Number on

spades. we reiterate only leverage we're XX% Permian of approximately months the made like delivering diversified volumes capital two want model contribution. I that to with production that would up of allocation low a For volumes and quarter, Veritas our about in

review came in XXXX. times, onboard run one was will and is less that path four goal in improve quarter, of NOG's we're one schedule well has sheet. returns. allow the believe ago, deleverage and further management four, than on Number rate about of shareholder to this a discuss We permanently been of accomplished in a the team leverage which major believe ahead returns Our I'll years times and mirror, X.X is as next. at When goals to we balance this shareholder

less delivered of back in a returns. During our forecasted. record flow free the we ended had QX, shareholder in cash Even debt to we still of and we returns, a percentage strong form preferred quarter absolute the and over of dividends the with XX% record shareholders buybacks, than with terms

increased which another all returns our our XX% relative deliver is also keep year absolute our dividend. shareholder discounted options increase this to open the and to improve and We valuation. included plan, goal Throughout more accelerated to dividend quarterly and

business As believe premium model great will we to that we we discussed, our provide to have shareholders. a continue have returns previously

notes for As authorizations annum. increase increasing the noted for as common management stock future. Board recommending is another our dividend take Number $X repurchases. the quarter per The XX% next the as also would preferred to well senior release, in dividend five, annual approved plan the that our and buyback has

cash We development up XXXX. are We end we significant both the production Permian in XXXX hope seeing towards mid-year. properties, and as Williston high boost exit for volumes growth and for our and XX year, set of on flow and should count robust XX organic expect our well which to free approach activity us this to see

last us has North inclining April, flatten in XXXX. will year. quarter, growth is with this our while and production actually on our be XXXX increase for materially we the minor full-year guidance. volumes will throughout mentioned growth Dakota As blip out QX allowed assets to throughout storms it I This improving, severe a trajectory Recent see accelerating in

outperform are To was wellbore competitors have we not cash for famous If for saying in that Bradley has thinking. strategic Number logistics. Omar as World as may development always. successful, expectations. part large competition but our in we'll strategy we update M&A Additionally, talk our prior ground game pie scale some we be General larger that traction bolt-on. War that, expect point, Legendary game you free to of and Small flow sky handle. done booming, just too scale amateurs projects professional talk the up, is six, our significant II to picked but activity ground significantly getting

We done a are to The shareholders a our speak to have you financial increased bolt-on decisions. benefit results we're it the And we today. to robust market residual accelerated number since smart of dramatically reported. strategic last properties as to benefits coming returns definitively The pipeline. of evaluating has

in always, top areas. prospects our quality we're As core evaluating accretive

commodity success year. underwriting towards will in close this locking strategy optimistic in approach. can upside we geared are buyer you for more one Furthermore, higher will we value. expect M&A majority As be would the the with PDP cautious meaningful our value can added convexity prices hedging upon and be our of the on limited, I'm expect

I've leverage previously, require expect not acquisitions our levels. do the public As given to to Northern mentioned markets, these common current we access equity

will I As take for cheesy more and each of by say every Adam call financials. for to and over this Adam? not is the to want a line like is a company on seriously us remind I it investors. operations turn to run you we Chad now when one taking to today. provide details typical, to tag you, time and listen I investors thank the And we we are to

Adam Dirlam

Nick. Thanks,

with above finished we in for the the the XX.X elevated as in additions to way. production. quarter our Permian, pull during Permian note, to expectations completions. Williston encouraging quarter. forward assets activity net high accounting first Completions theme on been roughly the as across is a up The with the came of a quarter during expectations entire coming performed in net wells remained The for activity have leading XX% asset, the the levels acceleration quarter trend the from added of our The position Veritas

asset internal also production forecast. above saw the While expectations, outperform completions base were we

and well Our outperformance continued were Permian in the to main private the contributors operators both efficiency. to the with improvements Williston that

by we performing well, in increase assets we shallower first production of belt, XX% set design. we declines Our change and additional production the expect wells the by months encouraged that are as Marcellus our nine been completed our and have With to gather well outperformance have with in roughly data. outperforming connection under been also

April. we the quarter, to in volumes Williston As look during gross significant second shut

working online. NOG not back was areas However, our based operators bring on to our impactful. of net to wells effect diligently as nearly The and concentration

interruption. the second through Permian helped our partially have addition, to moving to assets expect we navigate effects the And mitigate In quarter. winter weather late the

when the On has saw which levels remained activity quarter. we strong. with sitting wells wells, a in We drilling net D&C our from side the entered net build XX.X list XX process, up almost in

when also the a In the totality, the fourth has to been the As anticipated, and activity wells well proposed versus quarter-over-quarter. Permian, total about the In our with of as a Williston last two-thirds has for from the elected the a provided in activity of are net Continuing our in we the two-year Permian in saw count consecutive as that other acquisitions well ground AFE XX% the winter that pleasantly consistent the with from closed the XXXX. the game development acquisitions Permian risen shifted jumped up our oil rig also that high, to Permian back during Williston third, over of months net accounted of the on into finish year. and made XX% the number and elections theme, up quarter the We've compared quarter proposals levels process increase first acceleration surprised to in being wells we Permian the with XX.X elections year. XXX% us both for the large quarter. during

while also actively current We impressed eye that assets our Williston and been time, with screened of been approach well right well retaining elections roughly average the with and a operators operators the game other range through have ground been costs partnering modeling we capital quarter-over-quarter efficiency. are elevated costs the close new game observing been in proposals effectively continue over operators period flat acquisitions. the remain inflationary we shown balance what the Many million on the copy. I've that of And grow has expect be evaluation will partner to on some and well will $X to for pressures, we of deals have quality high during cost We've year. have barbell we is variations, with This the necessarily our case opportunistic process. within Per monthly and been AFE this smaller of choose Permian our we that not imperative with. at with to keeping our ground there of

commodity ground all-time the highs. variability On remains remained we've deal approach. disciplined end at And front our game the despite price volatility, in the flow quality, and

we acquisitions QX. during Permian net for acres deals balanced X.X and quarter The XX net fairly and XX closed the wells, were the royalty Williston between During net acres. XXX the

continue together, we and opportunities to essential something opportunities to to over able into to to off-market turn have sellers. approaching in move $XXX on due us can was we it potential continue we very the and in in are seeking the see With that that, deals Discipline were I'll getting assets, last difference market we ground to the anything. be do some extent focused us. for opportunistic the quality number front. non-op enterprise. realistic we Operators concentration with The and will for this both It also are second over those Williston mutually the a come million assets as a screening remain auctions in and No cannot looking and quality M&A quality deals to evaluate, We been of remains sales. do this to There basins that in only of Permian that they environment The with extent assets beneficial, layering don't to are we have acquisitions, quarter. on them. and in in to of formal the and compelling deal in both we year game the both beauty we're larger tucked on partnerships work what to accretive is put we creativity Chad. done, that currently

Chad Allen

some results, the by which quarter of first history. start in key quarter company was Adam. strongest Thanks, reviewing our I'll

and QX QX daily of average QX compared XXXX. XX% production over increased XX% increased to sequentially Our

ahead XX% Our $XXX.X to Street over EBITDA of expectations. last and quarter Wall million $XXX million internal cash adjusted to up more well than last and compared free flow metrics analyst quarter. was doubled our Both

having to differentials of which first ratio estimates. with Our gas came Effectively in were the Permian unit operating our Bakken per want than prices were just out in in quarter, EPS weighted QX, $X.XX line above fall our gas towards and in the has would and realizations sub-$X persist due well more share gas to better bottom per consensus These $XX.X I barrel, to guidance. QX higher remain basis $X is point a in under Oil the to our million we was adjusted QX, towards strong and barrels a strong pricing Gas natural flat per of in fourth differential. $X.XX expect guidance. the oil liquid to expected but continue per and BOE. costs were prices end back tighten, on quarter, realizations the compared

and As to expectations, our Marcellus make game below acquisition compared first annual production activity $XX.X specifically Cash last to ground was for quarter call, in as our guidance. our elevated excluding will a completion assets, corporate our was pull which for firm related the Street expense related forward commitments I non-budgeted adjusted was our QX. costs quarter, per that to opportunities in mentioned -- the on LOE acquisition additional payments we second Veritas transport million one-time be any required spending $X.XX Capital despite and on G&A BOE. acquisitions

the We Our made out The XX% expenditures in shape. of drawn great revolver, made X% other in availability. made Williston is the million the up total $XXX Basin up sheet acquisition million the January. items closing leaving balance remainder. and up after $XXX revolver, in capital for Marcellus quarter. paid the Veritas XX%, approximately Permian up million spending nearly made have $XX the on The approximately on late We currently the

undrawn expect Given next in the to we flow we year. revolver generate, cash forecast of QX to be our

commodity on of factors. that and depending free other move we how our use certainly flow prices, cash could All

asset As current we should would base, support base finalize liquidity. higher borrowing desired more our redetermination, a our spring substantially be

report, top-up our our opportunistically our acquisition. front, last it since targets On from the fill hedging the of volumes we've and north added $XX volumes XXXX and most in of Veritas XXXX,

guidance, select hedging hedging per up production BOE a target on to XX% XX,XXX range per of tied to day to rolling longer-dated acquisitions. day. to XXXX XX-month our to a with With guidance continue respect is XX% corporate We production to basis, updated XX,XXX of X,XXX BOE

as and range. of our higher end We closer production year expect we to ramp to our through move the exit the

growth to strong in some North we the a storms QX beginning but will at We see third slowing as of severe Dakota enter catch-up due quarter. of the expect

our As reminder, quarter. typically is a QX slowest

towards them year. So in terms of more three be the the of spend, last expect cadence to of quarters our capital the weighted we

than updating would to after on $X. earlier, stock mentioned in I $X.XX and our our preferred should generate growth expected, outlook in guidance volumes we're As more oil and dividend, dividend. to differentials $XXX common better This so modestly increased were than our million production result flow free stock consistent cash

well to As With volume XXXX. that, call Nick XXXX turn mentioned, for expect I'll Q&A. a for we steady operator also over bodes for back set-up throughout ramp the the the strong

Operator

Securities. [Operator Instructions] coming from Our next question Neal Truist Dingmann is from

line Your is now live.

Neal Dingmann

Good morning.

detail is so like a question good guys, strategy on far. layout. the I First based Nick,

when it small the Specifically cap clubhouse you, comes the returns. leaders know to call in all I'd shareholder

all are is scale other for you going larger the just shareholder or you and caps team, the key that what for as you forward So or wondering do I'm do payouts believe optimal to prefer Nick build you plan? small

Nicholas O'Grady

morning, Good Neal.

cost see is in think and markets, huge speak we the to obviously for we results Energy returns. of scale M&A make a portfolio. getting solid the is I diversification, our continuing no-op logic better from -- M&A there structure, from is believe cost as to shareholder to benefits to energy public capital, important larger natural both consolidator. and today's synergies our

being its but we for a profits. business strategy magic. profits the at stock was said, impossible with that up, value XX do out limits, grow investor opportunities day-to-day, per creates few most still That all and improve the sum the creation say grow and internally do current the can analysis We our I'd our the that let financially. manage is years. and profitability plan least control M&A we share can securities I and there. marketplace taken and in grow to But given long-term fundamental It's So the the that market securities of to shows price above

to words I'm So going not here. mince my

I of free do in and are ever the for other today, gap repurchasing so $XX. significant our I Making can with undervalued think do got we've means much is down flow, job. of forms any We're us capital. returns as are part use really take That authorizations place while cash we even securities of if bond generating it common potential as competitive there strip values that terribly repurchases. preferred the only seriously. own massive market you appropriately sure is my And

we around around, stand if this our shrug market situation sticks shoulders. don't to certainly So intend and

Neal Dingmann

to that markets. what completely potential backstop, it love it, you're great buybacks I of talking sort was just on advertising, And I -- agree. really then that, it's hear. second use how No, about, you capital my the

all, acquisitions timely maybe concern I potentially to the around of maybe the think it's some additional underperformance, with close think, further part You about equity start as you mentioned year but last interesting I certainly year, deals. coming

So I'm have should ironclad year-end. balance sheet, just now, by believe estimate, you towards I we you all wondering, right an the

So about Now look you consider be to how here how financial further certainly coming further shape you financings months. in when different a given that you you're would that, materially in deals? or going the at think would

Nicholas O'Grady

historic on valuations Yeah, I were we to be paying would that we properties, say, acquire we're when based successful. if

same a can clear, our since I our be place. material impact And million Directors acquisitions our the we our cash say, to I are in any the profits is fall metrics. XX% upwards credit in having think do roughly to $XXX would of about overall up without in of stock Board

the compressed has words market I common issuing equity going but its would means and to very, our here, think about to say, the frankly our need is would not is not terribly if that mince Board I don't we So excited don't I just property value Board and say to. valuation is

Operator

you. Thank

coming Next from RBC Scott Capital from Hanold Markets. question is

now line Your is live.

Scott Hanold

Thanks things all, sounds are and I like it there. like the going quite enthusiasm, well

Just the the obviously seems like, into know little up color And I Chad, on being OpEx side obviously some operating you the gave good. I pretty bit. -- maybe it of if a sort could quarter, cost delve things, of first your first trend looked

over does picture could structurally a you if a about then So also becomes cost equation? the of from LOE bigger go part help that, us where the like as just quantify Permian think bigger but just perspective, time

Nicholas O'Grady

Yeah.

Nick, Chad in out, you let bit in we and one one pay commitments done. year. thing as So, on I'll can't it the logistics spread this a talk is Marcellus of the this we for FT pay, The thing annual our terms an Yeah.

Chad Allen

it I costs around to $X QX. $X right. million now incremental to when That's that you bought it's the From roll then of We million that we somewhere to hold to originally QX you The had $X think related as of of $X the comp to a we at value along. have kind properties million looking fair 'XX. fair quantification any will when -- Yeah. of book million with and that coming increase in it in standpoint, to in comes kind kind through for we value as of receive that back Marcellus be

Nicholas O'Grady

of reason year, incurred it the it an so it last issue And we Like actual transaction. just Yeah. at that the closing. -- it's we paid versus incurred this in capitalization year say the last still that year we Scott,

lower generally LOE between productivity and -- the is has of the Permian perspective play the balance in Permian, think a obviously gassier I operating terms In a costs. it's from growth as

As GP&G book to to tends be as market, in it's LOE, it lower. so as closer we our well cost

goes LOE production per time. Bakken As obviously out on well over any unit up ages

our we static. relatively that that would grow I say, shift time our changes would over would so And be LOE our modestly in mix volumes as goal stay

Scott Hanold

benchmark? posted Okay. of is And first in say guys quarter, to that's relatively that, $XXX the static that a number million you sort good the

Nicholas O'Grady

the guidance, our just of would conservative, be to say, range within right. I

we we is I other think when at the say fact that prices all for do thing peers, of do where in one, kind too book we think have the to you liquids some about how that -- and other are account I versus high. very think

processing costs price of your overall to so And with are the NGLs. going float

as that now. if it's if of be a to getting prices revenue, that up elevated went that. but going prices part have propane -- a will gallon, it's above more Obviously were you're in So down to somewhat, $X will And lot likely LOE it to that meaningfully of go contracts go because and you contract. top

Scott Hanold

used spurred you going is help you for on? And of what's is your And Understood. the sense really -- all? a us is you of of game then in like ground an how the is that give big words, booming. say What Could Nick, obviously, for that opportunity uptick opportunity? you sort

Nicholas O'Grady

and consent really think we're I money. if and properties five in changed of extra back about is were spend and you ago years coming what's their in generally to money their they mean the wells What's all drilling I own when to seven world off. still dynamic $XXX operators that, that go it to high Yeah. a is would that prices is still spend just stuff want unique non-operated

or -- past Adam, that don't $XX describe that worth Well, could have... transact. with X.X want I and there, like quarter of here be as to the acreage spending scare so wells. I should not to instead of just $XX be a I a of net small you larger today's well to the size some the million But at to a as say going capital. crazy. transactions prices stuff, we're And than still what we've seeing we're up seen developments money XX% we're would is exists five which well in with seeing million is, interest net net And working what we're to seven you is could that well of would pad anyone

Adam Dirlam

go that to terms focus We've that. transaction, to relative X% and other shot -- Size And in are needle. trying interest getting the rate our the going on that return, the to not lot working efforts by bite of take its where competition people let are the is of to those of X% to we're got going to a of of things on. that's move got

So we're on can bit better little -- couple folks do you buyers, going pricing. generally a of room just know, a

Scott Hanold

Yeah.

fact full-year So maybe is guidance, did you you game of kind game as of potential pickup there also the ground outlook that -- the the of more contemplate upside at is the sort point? that of this your for activity account course year through to ground

Nicholas O'Grady

I Potentially. you one we think stride, Scott, portion I it, know, good in the take every each of this mean, I we within mean, as year, I think a for year. budget

we've so terms so very in to feel And be say very of that. capital We've are and to just careful, we not the additions tried I'd our very, we confident successful, capital been cautious when outlook. is very that in this

So with week. incremental we those a capital, assumption XX from have to thing And means the costs is we less completion of what's would years it three And a things about months carrying you're I percentage than I that that, for is compressed lead see been own past D&C to a long the we times list an in meaning necessarily months, been compressing, on we've speak. your make past this to sometimes good to sales. so timing nine on would time. seeing months. not had in six wouldn't One that about conversion Which discussion it that our noticed trend has interesting is that Board say, the is, AFE

bit going to higher because and in converting capital the money out a tends quickly. it efficiency your is very and very, make So coming

So wells it means as process. in carry many don't you necessarily

turning might you is As capital in the highly past and quicker. that have productive but much your

Operator

Thank you.

Freeman from coming is from James. question Raymond next Your John

Your now line live. is

John Freeman

some of at, that expensive look cost you're When below accelerating it capital, is? And repurchase more of preferreds target given shift of of maybe times that sense by flow that would capital the of -- is free being achieving incremental given cost a how cheaper much that cash leverage. stock one paying-off XQ most relative 'XX, make to revolver just the your to the preferred I to close the toward

Nicholas O'Grady

think three securities. let's Yeah. I mean, all I through go

and Just way. their we to they -- And to I generating, cash own flow logic one. don't I expensive And monitoring can We've clearly. but have them given you understand the weighing -- our point all all other, obviously they free think choose just in think cost I'd attacked capital. out is against correctly, most we it say considerations. first each have much preferred so as we're of of different because how their the you we're have merits

common why owe, chose mentioned the most that PAR will I As Fed And retire issued that's our the just value. now. market the sure that effectively some we one in Obviously, at modeling in the is we the than at point. stock comes itself this if our appropriately when making deeply -- tell money number and debt, in has the corporate preferred our our is the to it's first. that's expensive, have us And definitively to with stock, money can one you, either. is that it ignore basically mean then, preferred common can't respect bonds, and of finance certainly we about we the and it But you it because with actions valuing does XXX% of impact for less focus of

bonds stock our So reduction you as the our that float stock common well retire properly potentially help may boost risk preferred sense of returns returns. interest less for and you impact and mechanical the and in can the have some accretion trade loan and reducing saving The from impact owe. to has the most the actually than

about be we So I think measured all very think options logical are on careful. and I how the approach now. table this here But we'll and and

John Freeman

Okay.

And can it process. the I you're CapEx you're what as maintain confidence guess get during trying the shelf guide to done those pretty mean of out, then from to Now, XQ is that think today, And the I'm able meaningfully rightly it I because I'm I guess able appreciate so to are front, literally you well, of think you're what the levels? thought not seeing small about AFE's higher to cap, the pointed a only the first giving that I trying like remarkable on CapEx being you've was maintain just move in far. budget on is, budget. earnings I sense

Nicholas O'Grady

Yeah. cap large said I we cost We're a last year, wrote I inflation. an be will Bloomberg they company have small-cap facing cap article operators. but Well companies made because small retract Intelligence

that, synergies last the perspective. efficiency the from the were wells, are So many mention all. capital ones flat. operator Because We best an see the year it consistent Not not, recall kept getting fact inflation, operator focused we are is lowering reality we -- and the that capitalized things and most not may as that, of to seeing they cost operators on one maybe active and of ours largest we're lower those we you costs. A operators B if did a the

in piece a And so review. some I of I read ways, read earnings it.

we that. not better the everybody's we reject We visibility So visibility actually have costs. may soundly operators that see do, I same have because

early fall. companies smaller we a with increases like So last saw significant capital

Adam Dirlam

true cap Marcellus large SMID a got cap Williston look obviously operators roughly frame the it look way our the so EQT you operators private concentrated percentage of and is up, asset. SMID But XX%, just operating of large D&C if it at X%. from XX% other is our at standpoint, a the John, and to private other Permian is XXX% and operators I operating list cap you've private exposure

John Freeman

budget say that've we've your number discerning had cap companies job blown you would a clearly their that choosing season as well. Got you. a done because of large partners I Well, good through

and of I you've thoughts. choosing done partners. great But the the So all clearly their quarter job appreciate

Nicholas O'Grady

be over time, on mean time we're but But a won't we costs. pretty long and are own cases less this it wrong mean, we we to term and over conservative over from than many I to careful doesn't It because more tell I Yeah. more time broken to or won't time. the does performance, like mean from I choose everyone doesn't John, timing our and operators record in are accurate. spend pretty feel mean,

Operator

coming from from Rice. Meade next is you. Thank question Charles The Johnson

is Your line live. now

Charles Meade

the in Bradley one? for back reach Omar Nick, had I deep quote to you that say have that, that pretty

Nicholas O'Grady

I my got it actually. mom, from

Charles Meade

Adam have is is was cadence Yeah, maybe let World in me, the from have your it. me heard is, the is going real is security War And but quarterly Veritas. metaphor I'm that think contribution production II I you question on buffer, what of slight still what ask I that a lost curious is about bit incline a a with to and But full have here -- XQ. so impressed say to about a I XQ say -- I

on about a forma pro are month a production what's extra actually a up? in bringing And comment so basis, Veritas, pro kind is or that of you back of bit was kind of declining that just forma you is the

Nicholas O'Grady

were for Yeah. And no in significant Listen, -- storms there joke. North portion. the were of was Dakota there there were parts April

this. of stored materially mentioned then come getting is bit. all Adam it's this to way, it of if will going come oil just I think out you sort in that local in those and sales But located, think tanks May, it off. a of the aggregate, did outperformed once we're We offsetting the by things it to but flattening in have about impact where kind an

did an may within blip, a why being from So Peter you're we is it wrong. quarter, to out. have basically and Paul. And slows April But just pay it the impact it stealing on be proven

in annualized of sort increasing production an the XQ. later in So winds-up basis XQ or only either it on

Charles Meade

question. maybe Okay, that's then helpful. up And on picking inflation this

peak lot see you a you've you us, across are plays, with insight get Because what different curtains, I not pressures you but different about talked already share addressed could a there country? of -- pressures, think Are what guys different of does behind only Adam about anything, just already you to play different parts -- of operators, on I'm out? it's suggest you seeing the whether something to if different curious are do bit. And of one be get kinds kind 'XX how to operator is or sort that is of you in completions another? from going you

Adam Dirlam

terms difference Bakken are Bakken the are as in of were operators seeing and basins. certain exposed larger to as the Yeah, a lot better. a and doing well the the Permian between that we privates certainly

are are back try long-term to service a providers contracts. state to those if reach the You have steady function of contracts to a going well going rigs, up people

Dakota are a guys North there and highs function running, that It's operators a conservative ones in the two in of seeing certainly mean, is I they smaller choosy that Permian. operators, rigs and handful of we're that what our of to most. you're And two running one a the are ones the are in so year seeing regard, rig kind albeit program, struggle

potentially up, are You've those things. not showing that's showing crews got not sand, types that frac of up,

then the front we're in And publics as much forward. kind And 'XX larger order know in is in actively and as to add mitigate I larger where to privates, rigs of there the so this shaping far so in terms in of that's how in of things. of regard, at is game, things availability up, well terms don't that getting the stage as capacity moving but as

of rig effectively to are roll-off going it's state, and price depend the then to how think be steady contracts, win it's those I on and those oil. going just long

Nicholas O'Grady

would know, sand to in steel Yeah. lots pipe. world hard And is it's the and I say, make of you that a not there

physical So I or anticipate would them. are by on solvable think shortly those easily the more be shortages of relatively than capacity Those led number that issues. work people XXXX rigs the those who will

term I So shorter Is bottlenecks. are that makes think sense? those

Charles Meade

clarify, about understand. adding if just industry Adam. But in talking comments, rigs, I the Yeah. Nick, aggregate, you're to And about for your

Nicholas O'Grady

Correct.

Adam Dirlam

Yeah. Correct.

Charles Meade

guys. Thank you

Nicholas O'Grady

production, we existing. interest add thing working simply doesn't. any mean, wanted net year, rigs, a think I in it to as We add non-op output next don't it's Yeah. we if double the Charles, any about one to don't our net

does. have ramping don't operator same an types issues or So we down about up of the that

Operator

you. Thank

Next from coming question One. from Johnston is Capital Phillips

is now live. Your line

Phillips Johnston

the mentioned in Thanks. year. Nick, of you quarter the volumes each inclining remainder for

Nicholas O'Grady

Yeah.

Phillips Johnston

to -- schedule. wanted well just on I I update guess, the an net

five sort of cooler XX think of round so I QX half of the the and in so each six and in the was in in back the QX XX the sort total. XX to or roughly of or plan then jump kind out original in around year to

got to we've QX was think then closer weather XX.X here QX. I obviously some in and

might that wondering So how cadence changed? have

Nicholas O'Grady

Yeah.

perspective, think but QX. the We'll that would the substantial quarter. to there But in overall I we think think you'll from chance in of and completions have I flattening I in volumes, a a quarter, the modest number do -- of see of the a of coming completions fourth production inclining I pretty uptick, sort see you're just see And I going modest fields is growth. flat the uptick So a have. third in expect which back life, as to to a up second think from

So I XX would XX a and probably helpful. the the of would quarter. That's in fourth the to I year say, for say year wells XX middle plus quarters

Adam Dirlam

I in to obviously more adding obviously from too. depending we're that's being on the mean, to one Yeah. those there and drive when or wells, going month round quarter, is things month, earlier later

Nicholas O'Grady

Yeah. consistently imagine, would to And -- motivated highly we've people there, surprised sales. you a are been oil whilst $XXX as get the

it's So forward. pull quarter we've some seen straight third where probably the

or I on materially going think don't but And I the change so that's it, definitely will have. don't it's maybe margin. think going to one two play factor into to it's those a

Phillips Johnston

to that same front, where trend peak And probably some? to the QX a at of sort Okay. would level or be going is CapEx just on

Nicholas O'Grady

I than year, handful up right. we're to completions more and Obviously our each we quarter. would up a That's of be I in so should it's this massive we the CapEx. think going CapEx quarter right. spent But see we percentage this in a think remember should completion. That's less of don't Yeah. aggregate of step quarter see some

So in process. wells it's really about the

so not in cost at wells So wells. if times, we're those of by completed the wells -- this X look D&C cost X.X carrying of all process. went up you wells year our is those We the CapEx our list this quarter,

quarter because to are, is just be fourth borne that our is third where in the CapEx completions quarters. all and of second the going some So

Phillips Johnston

check Okay. level trading of preferreds days. wanted And to are then at to what see these

the when mid-March about last I or think were update was they so had I XXX?

Nicholas O'Grady

today's be right. mean think depends is I on ratio I between, going somewhere your Yeah. it prices your is, what really delta to

time the But in XX think So ratio, money XXX you the is to change. but about you XX% argument deeply in delta, right? make delta they're exchange like or what XX% XXX XXX, really it there is about you could to do the which but there,

So number XX.XX. share, that's XX.XX, of the right,

is a kind that add and -- math like the preferred get you close price. the simple will is four then pretty of So to on years that and coupon of spot

Operator

you. Thank

Parks Noel Tuohy Brothers. from coming is from question next Your

is now Your line live.

Noel Parks

one want just I thing. you on in know, check You to with

the And imagine to because things way are longer of hands? might the the ground of than assets talking just game sector. peak the were into what the they of their thoughts terms want in of on private owners just bit in And general. Andy, I best into market holding about that sort equity scramble You I I a they take activity wondered of have didn't on coming just and finding the assets your been think loss.

and pricing -- wondering So are just normal to somewhat are I where you we market to back activity that market fundamentals? roughly a where proportional conditions to

Nicholas O'Grady

here. see Let's

$XXX to some oil people is that think confounds I degree.

lot lot on variability. there for there the that market a sale, of think is I a is

discipline more stuff and But let making maintain assumed matador, price of would the people today. when up when we're when that's I there's like the are reinvest but on up to to they that the there and taking that probably few think money you a is saw a our Frankly, we they're getting function plenty that. very I and and a kind we're still happy XXXX, Johnny-come-lately In think feeling spiked little $XX, bull risk And oil by is done. mini of this those happens. they scale about small get always love competition, we they're run a people more want to some we're flush. of chase to trying people version dollars, than

the there more maybe stuff is a a raised people scale ago, we and here competition I still big others where concentration and the bit have can't. as think than on think risk a years dollars But there. few I managed few

think understands when plays bigger prices elevated. that I role everyone risk a are

say can't business that, might look, case you that's to that in at the which it would monetize might on and type take to frustrated risk great. get is there end, at when oil, is sell last you based a you're current because think this I for I this because I well they would is, whole environment, I challenge sellers Which realistic a want the lot the be in just why and you even always a of the need that this strip. market. And if to I you and $XXX the say And looks cyclical dollar think pricing. sellers in think of is out that an do every answer held is market and But asset needed are today's granted.

Noel Parks

of check, clear Right. course. that. you been And certainty -- as just noted in from have on just a lot pretty lot we on they hearing assets think you've sort a of to double directions primarily level depending operators. But been of of operator disparate I sort But you're are, that larger of the where pressures

like completion by I trouble equipment any issues or what issues like, that? not as So of howling or know sounding there pace you're don't operators. seeing it They're far are not, not in with sand as getting anything sort

Nicholas O'Grady

say, always just The try real I'll budget ad question and a you cost We are do even spent internally, about. of to an is, time. entire overdeliver to lot group you talk always there do their to underwrite it? overruns, what planning not have it? time how spends as are nauseam, that How investors problems. There we And under-promise we all our

are means delays So we're less you and is is, people, But we careful you thing not one and very if it Adam model absolutely we're that seeing correctly, are our mentioned that absolutely showing business up. engineers And seeing that. no about your planning seeing, all interest about have than the XX%, much. best cost part average crews when working pressures, as and frac

generally surprised disappointed. You're more pleasantly than

Adam Dirlam

average our $X call quarters last for million order of this million the looking the are consents to for and in at $X fees coming our those things. And then into we're in types at we're to going six account looking weighted year, in looking at especially one, budget million. And $X at the

Noel Parks

a the Thanks it. process reminders planning the Thanks. just internally. Appreciate description lot. Got of about sort of again

Operator

Thank you.

Research. Seaport Next question Nicholas is from Pope coming from

live. Your now line is

Nicholas O'Grady

Nicholas?

Operator

your is your question Nicholas. John mute, Perhaps Nicholas, handset I take coming hear cannot next [Operator could if on America. Abbott pickup hear your from me, from is you or phone Our off mute. of Please Bank Instructions] phone you.

Your line now live. is

John Abbott

I'm Is taking and covered, first Good have little is which you deal apologize sure on here I getting late my there was activity, morning, My for on topics do these thank if been questions. may Nick, some is a phone. of question, been a of sort the thoughts lot activity deal of questions multiyear sort about multi-year you a there of what's a over how horizon? -- already horizon? your but activity latest time, point are asked, this we thinking organic over slowed down

Nicholas O'Grady

I think logistics. that my in my stock I professional gave of prepared sort comments,

but risk mid-cycle want, this door, obviously, that we're We the period viewpoint, important, the I could if look opportunity and we back do Board buying significantly the need that now profile obviously to we the at is at which We that to strategy convexity that but really feel and bigger is it as it of those. a market I higher go within fruits frankly, we you can ebbs we we I sense we're things. the and your it. all did do and $XX. makes think flows is it today and do or could ebbs to keep especially get that through generate or we opportunistic, of our depending to of oil the -- that as than the take I in $XXX, risk some flows, think that those in to time, each need risk returns on we'll $XXX also know it in prices enjoying it And need XXXX. means think in the we oil, was think of comes And go to

money the were of last very, an an make successful year things We those transactions. entirely as a four we specific the able tell can had that were is batting is and why successful. bit been. four go typically helps one another there big average to that that I it's was And of really pipeline anomaly in ever we low. reasons our needed the through business for get needed CapEx, had sense a another So that was all We that as to acquisition always is one whereas money reason exiting very happen. be There to one right. you

value capital plot said, control desires That that have we the numbers. with per look and we meaningfully we value. and it add along returns their added has I tap find and been these can't we -- so can on actual even transactions are can't markets as results, seller think I being statistic, we our meaningful do say that things. don't, if every appetites and so proven at I way share the And what transactions

do doing a a great. we'd We we're really disservice didn't do least so, as the sometimes we're don't job to not. our sometimes can are stands to to grow a make today. our if it business anything, it's in we're why successful but company. need That's And be our company. think grow, with we're going, public we is find And as stockholders, or better and to terms and find down If But job we of happy look. I if is slowing capital we at not, ways ways to that it why to

John Abbott

I you be nice done? just and acquisitions there at out at like you're are be and and you mean, shares do But been I improved what performance, shares, having could And you've when stuff, is or you've looking green done? figured gone and you're of they've a stock you their undervalued. look to But of might done prices you think what else they've today. the improve you else at sort And relative through repurchase buybacks these till of performance mean, made it. size. that and sort a Appreciate when relative shareholder day think I Outside large potentially your mean,

Nicholas O'Grady

significant we've same said, the that I I heights. right last seriously. us the take the to undervaluing We of investor done on look our in authorizations stand market of cash year, a making Based and generate on things think quarter's for think capitalize part intend we've taken a own market and securities. just beliefs If professional the we The in massive I may have are this I'm incredibly At is around us values and the our new every this job, market appropriately my sit I situation all flow sure results, we've for business. outstanding. by. that credence from my proud really securities that. single to need perspective. certainly very validation us don't another acquisitions idly how time business as is a that security some we to returns have transformed We're on like time, how and And I to here. long built and free of generating got

big the stick. got on have is cash King, So table have all if options necessary, and that we've we the -- the we

lot a we about price. care simply, stock our put So

an have we'll believe view, model, still We proud. try my business incredible make to that in And underestimated. misunderstood us hard is who those and in

in been of tons saying have four our in I've overall years moves We favor. works basin upside to asymmetry, And ad nauseam oil. for in as pricing from

comes So are when we're on and prices produces that high, doing everything faster more.

Operator

for reached any Thank turn session. our I'd closing or further like floor of you. to the comments. question-and-answer back to over management the We end

Nicholas O'Grady

We'll you all one. joining for see next us. on Thank the

Operator

Thank does conclude and webcast. you. That today's teleconference

and thank wonderful We for line a time disconnect this your participation have at may You you day. your today.

Northern Oil and Gas (NOG) 6 May 222022 Q1 Earnings call transcript