SD - Earnings call transcript Q3 2019 | SandRidge Energy, Inc.

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to SandRidge Energy Third Quarter Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions]

I would now like to hand the conference over to Johna Robinson. Thank you. ahead. go Please

Johna Robinson

welcome, President and Financial me are today and Thank Chief everyone. Executive McKinney, Officer. Operating and Suter, Chief Officer; Paul John you, Chief With Mike Officer; Johnson,

conference that like would with release posted the website to on you Investor that call, We be in Relations referencing have we tab remind our conjunction earnings our under slides and we will actual and results mind, assumptions, Keep differ statements. during in today's and call uncertainty forward-looking forward-looking risk the those and are which from statements may subject materially these projected to call. contains in

make adjusted financial website. can We reference will other these found and be adjusted non-GAAP also Reconciliations measures of to EBITDA, our G&A on measures.

call to turn me the let Now, over Paul.

Paul McKinney

results taking interest to for just today we and you, today referencing morning. on and investor SandRidge. be us in updates earlier website the our presentation operations the you we'll guidance time review good Johna, this third you Thank told and our with your and to join plan on morning, our We provide to that everyone. you about quarter for Johna Thank in posted that

it I you along. So, encourage follow and use to

and the on statistics. a summarize highlights is Starting this overview that asset and financial operations an market that company updated X, a reserves includes few our map the of production our Page of that location company and tables and information

shareholders. to corporate both the success Moving summary our our Page key our to believe include presentation of remind we sustainable near-term lead to our on X long-term a strategy components is investors for in and business and we

chart of way guide the past, our us through you the discussed have as it and in conditions We continues strategy industry. changing with to our we this

year. programs challenging combined, efficient to focused plans impacted changes quarter, capital our we work continuing to hydrocarbon and by these spending of when high the results. reduce historically rest the by execution respect price for structure, on our our significantly the We began With to differentials reducing that, the prices responded impacted our were of and third cost

on to the As call, quarter earlier North the with plan last wells during drilled that Park in were we you year. we third shared six our complete Basin

We are – have We'll the results about exceeded with these wells our met be or from that with results those the sharing expectations. report the in you to more pleased well call. later

up At closing Mike Johnson review will the this operational this I quarter comments. to of few review results. quarter finish and third time, details will our want a to I John Afterwards, results, over with turn financial Suter third our to return to

Mike Johnson

created financial Okay. number Paul. drove guidance. third reduction that factors Thank results. full of we financial to G&A compared A of of This the discipline. year adjusted XX%, by spite We second reduced clearly improvements quarter. commitment to you, accomplished lowering the factors, these meaningful quarter headwinds midpoint In demonstrate a for of our G&A

our the reaffirming managed spend also to which guidance. capital the for production quarter, us capital guidance, while midpoint We of expenditure allowed lower

to volumes. declines As capital low with level we've our expected, experience of in spending, production continued the

quarter-over-quarter $XXX the and saw by commodity of The reductions in noncash the in million and to received of income required primarily liquids primarily test $XXX lower oil, driven gas, compared and write-down. net to ceiling due proved our million posted last million In we a test for $XX prices estimating for year-over-year was We natural price ceiling same quarter loss was this gas current reserves. year, impairment net the commodity volatile production. and a to challenging quarter, environment, prices natural

down a price were gas million. natural revenues volumes. of result decrease respectively, production liquid quarterly of million, total and Adjusted million $XX BOE a $XX million, and in on and EBITDA which in a $XX $XX $X a was $XX commodity on year-over-year XX% X% current oil, our in the last basis, year, quarter, natural basis million down decline for realizations sales from Comparing a is million, gas a

have just reduced XX% on remainder production $XX a XXXX. have our the oil barrel. We realized during during and of capital in derivative at current modest gains remainder of quarter above preserve we XXXX expected continue strike swaps the To liquidity, spending to price a of planned further the

million to We expect quarter, $XX Park primarily on fourth infrastructure spend approximately in projects. the North

unrestricted $XX higher million cash. at gas, we prices drawn third anticipated oil million of revolver current again, exit decrease with because year, prices. amount the strip approximately facility, million $X in our credit to commodity exited the drawn $XX on beginning quarter the significant on expect than an for with and Based We our natural and on in of XXXX the

by will projects. on group plan high-return our managing as XXXX possible focus preserving will this borrowing bank to redetermine And working liquidity be with M&A our capital of executing targeting accretive We base. for later month with our spending and on be exception capital opportunities, we the

John quarter his to on it operational our turn year. of now results the third for for outlook his and I'll the thoughts remainder

John Suter

quarter oil, XX% production natural gas. was oil NGLs, barrels equivalent, XX% Thanks, of X.X comprised and for the million Total Mike. company of XX%

cost $X.XX $X.XX averaged quarter for lifting BOE per Our and BOE per the year-to-date.

million Basin. CapEx completion $XX North brought almost costs, million, quarter the drilling $XX all company wells Park completion North six to for The in sales, in and from was activity. exclusively with Park

We to XXXX will until capital. in order conserve rig utilization defer

workover We artificial continue return, lift to do to high optimize production. installations our short and payout

X. the at Park wells look North on new now Slide Let's

limits reach pad quarter, date. south. drilled to As the on the XRLs pad, six-well we Two the unit, same north From the field. north drilling mentioned Patriot last to XRLs four drilled we Peterson Ridge of a side this farthest initiated on were to

the testing third-generation based of section a XX-well per pattern four we results the microseismic With on our testing. Patriots, are

We plus completion six wells operations in of and rig planned stimulation XRLs, within We've section finished these all operations early in same on in late mid-June. finished initiating September. We legacy June. while SRL refrac six drilling all initiated stimulation production and the as in of a early a released the August,

X, based within placement. than lateral on results Slide of indicated to wells. applying focus and test type Well the the rows Recall delivers lengths work XXX were on from designed vertical the section that prop four Patriot modeling design half we of to They test, more rack project. This a the earlier with turning of where prop spaced our wine that spacing half information the an we this microseismic earlier Peters estimated frac two effective spacing frac utilizing of Now XXX feet. of Niobrara, wells

unnecessary thick One, wells rows, were these laterals used entire so of no drain And with and that offset configuration well cross-section stacked wine intervals. wells three, fracture rows on wells the interval. located of well light changes to the per at this per lower which Test rack section, adequate the eight the new other we to of spaced Niobrara The were avoid an results, configuration. diagram Two, were upper In of vertically top in Patriot is three each stimulate effectively the project. XXX-to-XXX-foot two we row wells right illustrates implemented are bottom for interference. to at pattern effectively believe slide

verify of delivered regards production spacing improvements the have test see as the These wells helps the well wells production that anticipated production well this which graph from In results, third-generation test. successful performed targets, can these cumulative table planned. and to you

wells, seen further which We have not between encourages signs us. communication any the of pressure

successful still Notably, these Controlled with better flowback average on wells wells on these curve X,XXX pressure days psi been than have methods after type online. rates. have XX-plus employed flowing

the which For Park, of improves on well the the first North $X wells, two cost in time below six development total future well economics reduced we planning. million per for

Turning to X. Slide

legacy Niobrara Patriot refrac I mentioned As well, conjunction wells horizontal project. offsetting earlier, a X-XXH, completed we just with Grizzly the of a this in the

each the You this the the on right operation slide. We see several these other map top of wells the can proximity for purposes. in of to chose

were the but data. was primary was technical laterals not stimulation in this The a feel the about area. the accomplished by reduced Patriot energy of improve production, and vicinity the other to not pressures the to and only fracture the by re-pressurize treating stimulated pressure efficiency reservoir purpose resulting new to We also lose be that to

thought on lateral. the section and be refraced newly this perforated to project improvement its Additionally, wellbore production success, on approximately also the forecasted a tenfold had on the wells' shows after re-frac year. We Grizzly merits. The in refrac. that added it right refrac analyzing interval. X,XXX this unperforated post bottom production graph of the we would additional Based successful improvement days own we're candidates the the feet scheduling The first next anticipate XX we

X. Slide to Moving

we plot Our the and level first a year North production XXXX three of any property. record QX net purchased delivered quarters we've daily the shows that oil Park production best since in

the of were wells early than the since until The third quarter. end at new quarter lower to QX was brought mid-September, online no

with Additionally, artificial downtime quarter lift some impacted associated third out equipment changing production.

that with efficiency production artificial quarter's on work Park. These will the improve anticipated lowered This QX from improvements. full-year oil combined the QX fourth all and to items continue wells, projections the QX. record six of on our full presentation. of were realize Regardless, quarter will We new these benefit which last from should optimization lift and XXXX end North year

in well In and closing, the results. northern our delineation work I'm Park North associated continued with pleased

Our period team lower this remains of in on optimization deployment. production cost vigilant and capital reduction

personnel. without standout like from our would a I signified again, a month record, team for consecutive thank incident safety SandRidge the by Once company to XXth recordable

it hand Paul for now to some closing remarks. I'll back

Paul McKinney

we And and of proud no results this are so quarter of year. the John. operational far recordable this safety Thank our incidents you, of record achieved

much for hard SandRidge commendable thank team, to Speaking our you and and work results your these continued safety record. for very

opportunities our continue opportunities look to acquisition business buybacks, evaluate our includes distressed as As shareholders. and to dividends. allocation opportunities but identify course This sales, we for for evaluate asset a opportunities, We only process. and acquisitions, our can merger workovers, that in normal call, and returns including of part the several as mergers mentioned also in internal those drilling highest not of the last and generate investment market, capital asset

against In light program the valuation, long-term we impact repurchase also assess the declining the in value we on of of opportunity At the production our share our marketplace. will light such program our our any a time, consider must liquidity observe current base. regularly of of in same we

to being for shareholders. our with our value other to goal continue primary these maximize will We evaluate and strategies

close experienced joining of call remain we that point, our the focused by and sincere express this financial to appreciation on to challenging changing us saying and you responding although shareholders. to conditions this today opportunities quarter, for that a most discipline, third like our all industry the on SandRidge in value appropriately At investing I'd of my create

I and open questions. call over the for turn will our up it now to moderator

Paul McKinney

for this everyone, of your and our conference of end participating the thanks support you, is in Thank call This for call, and SandRidge. again.

Operator

disconnect. now Ladies does conclude call. Thank and conference today's for may your gentlemen, participation, you you this and

SandRidge Energy (SD) 13 Nov 192019 Q3 Earnings call transcript