REI - Earnings call transcript Q3 2020

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Operator

[00:00:08] Greetings and welcome to Ring Energy 2020 third quarter financial and operating highlights conference call at this time. [00:00:17] I'll that on a listen. Only mode and question and answer session will follow the formal presentation if anyone should require operator systems during the conference, please press star zero on your telephone keypad as a reminder this conference is being recorded. I would not like to turn this conference over to your host, Mr. Paul McKinney, Chief Executive Officer and Chairman of the Board of Directors of Energy Inc. ahead. go Please

Paul McKinney

you Laura, XXth, taking you, would We for to morning, Thank insight month strategy review will everyone. interest participating the and our results will be [XX:XX:XX] President few and would to and I in Randy that three time our and today. employees operations Randy though, Broaddrick, to to begin, make like for will Operating nine to call be with to plan the energy, ending like and activities. financial Vice ring CFO, [XX:XX:XX] you join you to the I operational and third reviewing now and for the September Thank period we good introduce Danny. Officer, our about XXXX, us and be your additional with today and points a our Chief Executive Danny before [XX:XX:XX] the reviewing over quarter. our turning financials, the Wilson, this provide

we a First, good very one. had

our these Gené reducing challenges quarter. on Élodie details this [XX:XX:XX] do and significantly production see looking our well. by to exited EPS XX debt free percent. quarter percent as in our prior and almost quarter Danny spending. back increased dollars We flow be cash We almost adjusted million and over to XX reduced with our some [XX:XX:XX] contributed increase I'm by third over bank challenges. the The little Our the what XX cash and [XX:XX:XX] meet the of quarter quarter. balance prior on increasing our XX Randy plan we were we almost in gas million million the challenges sheet over in in to and this derivatives our oil the to capital gain realized by significantly will wells these production, and of a accomplish beyond review XX able to We I and liquidity. ahead returning discuss our

third means this to over to Brodrick, Randy that quarter our Randy? the I So that will our turn results. review CFO, of details financial

Randy Broaddrick

[XX:XX:XX] you, Paul. Thank

would any provision Before within Litigation during that reference the I of safe of Reform harbor this Private looking we which begin, be Act like Securities statements make made call the are of the may to meaning forward XXXX.

explanation, release, refer do to Energy Monday, dot one the complete would a of you you copy release W-W at November the company's posted issued be For have I our will if a not website Xth, on com. Dooring

loss result loss For point XXth, of dollar million net per the been six had million two ended and seven nine loss our to. the share six on Seline September items, would loss net income of included compensation these The been one a income loss suing three This income cents. based of point compensation loss because Without Without [XX:XX:XX] of income prices. included and three expense. of September of We in the four two taxes, effect million point forty result bond seven as point of point we net ninety approximately a on or nine the based XXXX, per point changes one hundred XXth, revenues pretax XX point The unrealized one a and would million, of million our of oil after the months million ended and gain unrealized is three reduction test reserves five the reduction two share fourteen impairment fourteen hedges gain and approximately and of taxes, gain the impairment The cents of stock or thirty a XXXXXX in these point pretax had result have a of XX oil five a stock of is the in a months hedges derivatives have two one prices. cents per value diluted in diluted net value of approximately of million, and eighty net after three on effect or as the our point gain recorded share. million one share. of hedges revenues loss billion, items, This XXXX. unrealized million of loss changed a test two net expense. per

million. six cash three in for point approximately During expenditures point the of flow XXXX, four September cash point had three ended net capital and we three flow eleven months XXth, post million million fifteen in positive capex

During two we cash positive flow, two nine the capex, expenditures million post cash for flow twenty point two net XX XXXX, approximately ended capital September nine had point forty million. of XXth, months million in in

dollar million, eight two million XXXX per Guess prices XX sixty received thousand per dollars cents and dollars received two average one I month ninety and hundred had the spills barrel average an sells of per we thirty averaged WTI XXX mix eight Mcf and an of between and for and and To thousand sales oil For three XXX. XXXX gas per oil XXXXX, of Differential we dollars for for one of oil, period, bialy. All thirty XXX cents oil dollars million, had of prices barrels. sales gas for XXXX FCF oil, bouy. five price per cents cents two of barrel. a a one gas or per three for and nine XX EMCs of total of approximately barrel cents XX begoing. period, total barrel thirty month six dollars our for of XX And XXX of eight XX XXX [XX:XX:XX] per received XXX one of XX the

the highlight Before a I on, few would to call like items. I additional turn

we four CapEx cash to With the our credit to have reduce a debt flows cash of flow. quarters to use third XXXX, quarter positive of post We consecutive recorded facility. under intend now continue

was reduced XXX to borrowing facility our base our credit during redetermination, Regarding our million. spring

credit million. reduced September balance on we of XXth, our to XXX had As XXXX, drawn facility the outstanding

the group in the providing bank fall the of process information are our of for with all redetermination. We

schedule four payable have In As us the efficiencies our the and the at end this with credit twenty debt six we we to what outstanding cost to the time. provided the [XX:XX:XX] third base noted at end addition accounts, on the to facility, [XX:XX:XX] reliably Tinku, that to payable in to reduced at information reducing operational extension has borrowing recent redetermination been the As properly an year our fall and balance reduction bankers. of eight outcome under reflect cannot such, now predict will in allow our fifty requested we our million million the received redetermination be of reduced point also point four accounts quarter.

at We also on point had hand cash XXth nine million. of seventeen September

to nine that, eight approximately are received and million nineteen company company seventy hundred nine XXth, common XXXX, completed twenty registered eight eight point shares, issued million. thousand point hundred With completed at and direct a I million warrants. public September and net warrants. a hundred Lastly, five In anticipated offering Gross prefunded of XX million twenty and approximately four eight point twenty common over proceeds to offering total, Danny. common proceeds concurrently were hundred thousand million be warrants and subsequent to five turn eight warrants closing the it twenty shares, one will the sixteen prefunded hundred thousand XXXX and seven

Danny Wilson

Randi. you, thank right, All [XX:XX:XX]

As after returning focus quarter shut having a was the was in wells in of time after significant in mentioned our down October, production update for been operations for third the amount on QX.

than in excellent Our field greater bringing resulting back QX. our production from online, an field of XX personnel job increase in did percent

We Rod eight of versus thousand continued was thousand To fifty Six XXXX the vele. hundred percent conversion during conversions Third quarter wells areas. operator these a we've Basin production forty production forty in XX were completing combined to Across converted Central date up did continue platform. XXX bouy our with our drilling commodity percent two Basin daily eight increased and E.S.P North-West to QX the Shelf Beeley those four the the net on were third versus for Due approximately to program, and quarter XXX of platform North-West daily Central Wells and on percent. no on six had XX Shelf QX QX, quarter. net of prices we XXX net in the low to five production activity.

We savings continue a program XXX as wells reduced are to XXX see XX [XX:XX:XX] XX job, converted to XX the the from performed, for significant the is dollars a work from cause to per thousand per percent future. which, thousand to Well, on to XX work depending reduction. dollars down job,

allowing Beeley, which in QX alaoui reduction. reduced the and lower dollars addition, of This XXXX. XX a Another maintain future quarter rental to this anticipate quarter of reduced to spent down at lower I'm levels million from EPS. in Paul. results leads three with fourteen in And we greater our come of and from This be longer XXXX with lowest expect a perform QX [XX:XX:XX] half electrical by announced us it we for which per can CapEx percent greatly ago. that to in even of lower to twenty call, seen production levels, At measured a major over bouy our We second production activity. expected budget one in be violi usage to per for the the will our over In is And have We've back in QX, in times, as over the again time. XXXX able ten This day, approximately expected cost than rate and range, per our the for Evidence the through cents welfare of cents this day see seven we XX is to of were late cut be year higher elimination instead And is failures fees from CapEx. failure factor dollars run rate. turn greater, same which dollars on we million. between once production. is conversion failure benefit that, at and within month end and program year rate announced production budget no XXXX and walkovers will dollars XXXX drilling or XX bouy continue to to going XXXX. per to per the within finish we levels we our QX

Paul McKinney

time the believe of quarter. addressing to challenges. experienced significantly you, of by made some want restoring but company [XX:XX:XX] thank a would our us. did some challenges the and back the compared quarter. this wells challenges the we our Yes, second with still to facing structure. of and all the online our considerable reflect numbers [XX:XX:XX] just industry well, our from benefit the that We me this cost I And our reducing production we I point Danny, that agree of very facing you progress, spend when Thank increased majority with call, this and solid you are

First, longer these release, energy we conditions induced like. in downturn low ourselves pandemic is economic we levels, as that we than credit in may this continue believe find keeping historically at prices of any us would our said

business, as today. And so our remain we assuming planning pretty they are are much prices

production The size alternatives relative advantage disjointing asked strength. the is high production and low production answer wells them down or high what to pay questions? plan capital. of maintain north is various declines discuss levels northwest One and have We do the second invest to first. to I considering the Central to flow to conventional those Ring's let's debt relatively life, what in long do low debt. the enjoys level our decline, in the have Basin is been First, perhaps their experience, of pay that debt forcing help Ray to are liquidity capital Or need many production we the maintain producers not platform issue the shale cash down company to our shelf. deviling ring. are to in characteristic the We base

what sized a usually base and Randy and provides of significant I of call return, workover as blocking just Another That Small exceptionally benefit months liquidity. tackling discussed has job. type Rod create conversion install. light such our such out production Pump have to investment of inventory job. opportunities E.S.P medium that to and These of in compressor as investments or weeks matter high and rates changes Recompletion paying cleanup of a an pump

about is projects, the you And of a XX oil decisions. our need the tackling inventory allow long on [XX:XX:XX] to provides opportunities economics in which coupled the it the line by is circumstances the capital important to times, investment to but of Referring environment our dollars understand return of flexibility the blocking is prices. liquidity current highly generate future our to opportunities I what spend maintain be challenging and what said option but the production organic our high principles rates a that When base will investment internal with company The [XX:XX:XX] consider for has return between and of thing what our you at not to high more grow change, currently to to how well only and these decline and not XX industry. economic similar environment us principles of inventory is to to meet we of driven depending Ring opportunities costs. at Having opportunities make asset based part even the only survive that, be. of are increase our return and with challenges of as XX can believe poised our understand production, very rate we to these the breakeven percent grow This of rate drilling shallow inventory in Beeley. investor to low an presentation, third per percent

So capital that market to relatively are projects to are allocate of projects we liquidity that high improve our our let like me levels improve they our we will liquidity. debt, relatively those and prices explain. only historical and low today, have norms conditions to When commodity

the the will the we're return So this [XX:XX:XX] of lower meet also bank what capital evaluate norms test, not most liquidity. during to wring allocate determine energy merits debt prices in we will determine of with investment will the medium to We are of that liquidity have However, like economic such long mean? our option conditions prevailing the other and We important project, production recent strip capture evaluate improve majority products to the them is does the that and of But overwhelming growth only today. generate growth investment. and using then historical as an ensuring has that levels, the will when our at task will we because sustain company. likely projects price deck amount [XX:XX:XX] them the we but opportunities still times market consider to term believe we priorities, to and company that we to our the

remain the decisions, drill past, platform the may have currently hydrocarbon principles let's specifically and are few long of about can We the we in In be more operate, that the are we on will production of today vision we we logical consolidate to is cheaper them. southern the are to near-term talked we've are tremendous to opportunity doesn't consolidator amount believe as to low. consolidation. that Well, areas as I Now believe ripe said we around of what competition that for barrels as companies investment talk prices see in and the assets [XX:XX:XX] marketplace as too market And for for a about only can shelf. that also leads window we believe appear there guide too our the our buy be barrels I in of which going our in in production which than There it, for us many we opinion, simply few. too a operating, do.

we advantage of current So and we take want conditions acquire to the can. what

is economies around we currently mean company. to our to so synergies. earlier, me or believe in flow, we [XX:XX:XX] drilling deliver of before the the liquidity [XX:XX:XX] up be have let next or focusing it consider of liquidity rig. investigate [XX:XX:XX] making capital consolidating rig wait a in and we we as on prices will We going [XX:XX:XX] My and I projects inventory liquidity scale discussed shallower up to opportunities where what [XX:XX:XX] many decline need dollar drilling such rig, are we picking to before to of because it existing preference take not similar determination. earlier. pick our our our pandemic a efforts would areas not drilling life spent. assets The highest handsome prices, will existing current to at be accretive Ring the but assets is amount we consolidation various same and XXXX Ideally, earlier we operations to oil. Spring allocating So to up are have we be the existing our these assets we drill to basin, create in a to about Energy that plan This can strength we currently the opportunities projects decision on But and we of return, opportunities, of clear. long are assets pick are forecast may is we new reasonable per and drilling? say type additions currently levels blocking investment levels. will of make and debt the areas advantage smart does That ideal until that of thing that drilling So As that currently acquisition versus share forward. our can that part if exhaust by tackling We they paraphrase liquidity thing liquidity needs discussed a We more The prove the other will develop characteristics cash existing a that will operation. of portfolio. to [XX:XX:XX] upcoming is is this do. the acquiring those focused

the borrowing current able redetermination. way, [XX:XX:XX] the future certainty status be due valuations is the it I since more December. of with base to decisions of our to discuss will our now redetermination wait the share in Once base completing borrowing we of while those results the be upcoming make our our borrowing plans we Let's upcoming will out We [XX:XX:XX] base necessary up. for brought of uncertainty

October. of project our to in workover we to arrived we program they we on group enough results pandemic pile up up Ring companies, the we projects our type month cost information extension earlier, expensive rig to a to crash, the value that complete repair realized work. more record one to the start several improve the reserve number hopes freeze blocking from of afterwards work during give requested by projects before [XX:XX:XX] outcome. one workers like contribution. and the stabilize. began our projects, on of determine decided in the time and to what up I As until need our Randy operating based the accelerate estimates enough actual and and spending full Balnaves, But put if tackling bank production know [XX:XX:XX] height potential program with the These improvement other Once a price this wearing, induced borrowing picking a many complete outcome. capital effects that all to begin to our best the would the picked We'll mentioned

Soon they their And information you said, the the give another banks need of provided Randy to have will update. valuation. majority upon as rely to complete the we already and

thing asset the talk be that sale not did new for data. we up accept we will We should to finalized a early At that close. Delaware [XX:XX:XX] will which no The a on longer provide information would next they project sometime outcome in will to in should continue I their be waiting in be deadline and completed December. a is point, hands about that anticipate think it we

the of prices, has the had termination corresponding it secure the challenging line out review ask and And a extension. is are close for low we the the for to of our The for the redetermination, request needed to coming effects had and sand, we these the that not in happened? speak. The And internal low with the financing six timing to made oil a on value Delaware reductions completing And our they been so making all for initiated many question a purchaser knowing of to full first operation a the but be we the and develop are base purchase just as we assets decided to really The existing borrowing deadline oil that pandemic. upcoming it the sale for the to for before decision is relatively prices the may investment. in have liquidity. or with answer draw agreement will of right to volatility assets, dollars last process our what the the further offerings we since now, to of we the consideration, is thing a it respect and should stock production our net and estimated neutral With benefit but raised a completed XX next as in sales sold borrowing proceeds And resume approximately don't assets? believe should assets said, liquidity. know increase process, we on the discuss million, run our impact the borrowing our Randy whether with [XX:XX:XX] base negotiations XX adding hopefully million right shareholders. reserves we increases with month, The we respect our which have we late base keep and we of purchaser, another the redetermination,

And further. of what liquidity use our So proceeds will criteria considerable did planning second However, easy not meet proceeds we and acquisitions it. with and to answers the was We did or asking question use leaves to to an been that do a [XX:XX:XX] of similar it, you answer same these I believe have out we immediately to found the there about stock. our came do idea hearing the make are acquire one. are Are The on oil potential board, I To I our to organizations did of believe to the and our questions? began our increase In encouraged being the the preference the and fund. the earlier to on discussed third such see improve to a raise I we we of discussed to [XX:XX:XX] arrived it. to or why from that pretty do First, the I as increase question but what [XX:XX:XX] answer that the is. it, equity of investment and that we to a and producing to the with number to is is structure dilutive proceeds? why calling have the to The as this issues And assets these hand, Right. that did liquidity is our consider it? we are our event transaction, one highly have acquire straightforward, opportunities each a earlier on that stock when these Once us every message if fix first and the course using balance could meeting you of kept organizations need question could, discussed before we to your transaction know I opportunity raising with why properties assets great useful a your additions the was eventual did that the and would are potentially conversations, I would potential before through do liquidity we have at. we portfolio. of questions we willing this and answer sheet. to depend I part we we couple to gas wanted what

we XX. like consider believe required able additional needed the needs for are that us next our the of a equity. cost use to liquidity investment are challenges enough create parties as thing programs. create So company a we opportunities When come It liquidity facing useful an to the their liquidity be to their risks had liquidity, additional I available transaction the stock build were apparent raising a to believe is withstand our there and catch in to investment to to of I liquidity. consider risk sizable with about relation have stock, The But currency we potential was the outcomes to to is beforehand. and and to to organization. to what the know We'd

to of lower end raise we have equity planning after we could So will are than believe can liquidity. we be potential we know the you barn the released available that discuss level a feeling had company discussed sure Although third facing was liquidity rarely still can a details although the if raise of next various after so up with that like. launching are, I relatively an we'd the thing in the useful were liquidity that redetermine, And the and to our finally, is the potentially [XX:XX:XX] baited possibility call equity adequate scheduled concern of enough quarter risk call. you results. was the We we is

creating Tom now am character, can it Crom complete is are He to to move can like a the [XX:XX:XX] budget himself or to over true raise. of hard the this growing Rochman. And truly all record. way, [XX:XX:XX] the can Harris. you congratulate your shareholder take to grateful deal like last time that do, of best, ethic board premium overcome our the still my turn said and John baton equal one out for at facing next call, about men just focused spike you to we [XX:XX:XX] man, a is acquisitions this welcome create the to I'd in Tim's work Please him. is I and the loves leadership I'd oil the scheduled few to market, the before very that look of [XX:XX:XX] absolute was subjects what would members, say on has created to earlier, consider best about experienced looking to to Ray and During whether and was am right of a that one did. do previously and we me budget Tim a in was fill planning to and we as that taking opportunity we having right thing to level. the the do, words trust, shareholders, I very value. opportunity as had in Rogers something and capture us when of to for man stands track and and moderator that he legendary Tim [XX:XX:XX] and one to him. in has shoes work opportunity who is the this trusted our our equity investors the very our Mitchell, the past, I've you In commitment doing to the considerable opportunity to else mirror thing to board that the shareholder questions or new working the time integrity, with a that. and take Richard those incurring truly advantage this Thank and say the earn that accretive board. invested are that And this just with for company And a your meet to a There to industry. rare whether will [XX:XX:XX] of and with with the to it the investment the shareholders the forward us have do we Tim considered opportunity you each because I stock issues pass believe and to question welfare company. know I felt thing rare value, to we as our ultimately to dilution we activity just experience about, the on deal, doing Now talk presented all previously raised to do. a The challenge

of turn all to with Laura, our at questions. for so over like point, And moderator, said this that being to I'd it

Operator

be and conducting a [XX:XX:XX] At question this session. answer we'll time,

on your you like from speaker question, would starkest to question. from the I before your please you. in participants your to to up start telephone the handset your May queue would for to like for moment, if press always line get is one move you using you necessary If what pressing call to one question equipment maybe for the star you question ask pick confirmation indicate a

line Truist Our Neal of the first from question comes with Dingmann Securities.

You question. proceed with may your

Neal Dingmann

details, are idea two How [XX:XX:XX] just Paul, Morning, for your would deal. Ron your thanks and first set rig me it about you? give the mind doing Paul. versus Harry, things? return simply you're a of you evaluate now maybe thinking kind think about team those of be, when when back a I'll bringing My question or the Is

Paul McKinney

the along the production of that to you that other not lot today's also developed investment not you opportunities the that marketplace. the that getting each know, those our of but are you opportunities, function current along come assets, well. a things with PDP you the production that when get that that valued it's with would you But drill only acreage. may Yeah, in getting come along a are of from forecast of in of merits you you barrels truly [XX:XX:XX] daily with and bring asset, And the that PDP especially acquire a environment, the when well, be

of so part along than said this with environment buying barrels it. all things prefer And that other I've of reason for in is the strategically, why drilling I because come today's them these

operate. the operator effective very a we in that areas are We

And it a area, that so if assets to more stronger I presented just with energy in think future. the builds opportunity in the for acquire ring

Neal Dingmann

been prior of, [XX:XX:XX] to Great, little assets. you about, do and you've sort can there with bit know, things nature the you and, been hold how maybe is little your the or to you of about hold the you bit now even then know, talk you know, said, of to that production could you know, you you you baseline sort a and production see, just since the that about in able a of there, get thoughts you've just talk up

hold think those? You you're able to

Paul McKinney

wells declines and to to think to formation and the of for we we're applies your because always long lines acid. our initial prefer the upgrade you production. that might is barrel after I comment made decline, am to you portfolio strengths low to have that a hole this with make, be want that want their properties base, seeing point about we less just Yes, that opportunities always and less production like that and that, And declines. Neal. we going big these have barrels replace. you directly opportunities. shallow our of Danny, have especially and characteristically back required after all this type organization to in our have have strength have fewer question production, to maintain have decline the is the to When of you What And to [XX:XX:XX] is our is producing The you and grow production shallow so looking a of live that I the you to long capital defined this is to replace inherently shallower have the one and of returned [XX:XX:XX] I now Andris we

Danny Wilson

averaged the quarter to just a at brought And and quarter, production extraordinary, off right compare [XX:XX:XX] day, percent wells year, Paul at they the drilled is back point we and XXX pretty run operators that point only out up out look off we about where and us production. four in we're what what think from to I where in a that drop when saying, those on in to the which nebulae now, you is the a over XXXXX different in back see if shale QX, that there and had go considering we've XX especially you

Neal Dingmann

darling. Thanks, Thanks, agree. would I Yeah, Paul. [XX:XX:XX]

Operator

He Northland question. our [XX:XX:XX] the line Capital of comes proceed next But from may Jeff your question Markets. with Grampp with

Jeff Grampp

wondering a there, well cost your some Morning. you wondering, [XX:XX:XX] if you new was Danny, across what the feel trouble [XX:XX:XX] free you, guys if want know, I bifurcate the at And know, those new Paula, But some between and think reductions meaningful today? what slides quote. numbers, obviously Morning, look to to So the cost in do having time just, for of the and to you kind so. you cost well shelf sector. to just might relative platform, and you for guys. it what guess, guys I well a wondering seeing cost might maybe pretty a we

Paul McKinney

Jeff, Yeah, on yeah. that, [XX:XX:XX] so

chance below to there's know, you lower And else when are know, about platform. we that. in fair when of costs even at the right everybody I But, starts million I a to just two basin work. We've on I and Shelf think be evaluating the I a to central back looking our the the honestly, with two and getting can dollars But, vendors going think think able now. this it point vendors. on and get very they we've all two and will North talking those little on a hungry we're you think continually depends million or So less been West on been through market the

to two easily point So two can I we think range. it dollars do million that in two

Jeff Grampp

maybe liquidity updated And think to commentary and discussion math thanks. of go about, that XX But about makes price on good accretive. sense [XX:XX:XX] the all realized focus reductions good, kind that guys kind liquidity had think some does you boy, this no dollars go Ok, internally you point. if cost have previously or meant we of know, new maybe fifty you some a I in guys it's dollar you changed, drilling had the also of inflection any realized being Does being really said do that those thoughts a kind of the for change bull? guys? Should still was

Paul McKinney

well. really good [XX:XX:XX] any of prices, Well, dollars I decision, good given point [XX:XX:XX] drilling no, in have type and of be at up have Some program, no lower I we would you other fifty at condition. that moderately good and pick not willing go may you the use know, or go can to you it well drilling at this because really, a envision rig then wells

outcomes of range And of some so there's on a locations. there's these

areas Some that in having been anticipate superior in of our where to our economics locations those have presentation. we stated are investor

decision [XX:XX:XX] go has I it And more It'll respect our circumstances with are an the with link the where particular liquidity in forward? going to and to and to think hate needs mix. our we so. be to I go our And do absolute a company. price. no

Jeff Grampp

helpful. the sneak redetermination the current come in the borrowing That's One retaining or additive was the base base base? Delaware [XX:XX:XX] Okay, clarification. to Can the in can clarify, kind asset the guys collateral in just of great. a would borrowing the on fall be I front. you Basin included

Paul McKinney

Delaware in yes, The it to going we this that in now were so, and be assets was data the whereas spring that set, [XX:XX:XX] were to occurred earlier same going are OK. planning that remain not and originally included those redetermination year, assets

Jeff Grampp

it. Got guys. [XX:XX:XX] to Thanks

Paul McKinney

Thank [XX:XX:XX] Jeff. you,

Operator

Palmer. from comes question of Parks next line the Our Coker Noel [XX:XX:XX] with

You proceed question. may your with

Noel Parks

Good morning. [XX:XX:XX]

Paul McKinney

[XX:XX:XX] Good morning.

Noel Parks

replacements it missed might remaining you what and was replacement [XX:XX:XX] I did curious on I quarter? questions the time program? that And Well, ahead your a And have be? there but I for was fourth rest first for of the and would might the had quarter of earlier, capital plan the few comment a in if Rod inventory

Danny Wilson

workplan have well things of that's for that a do a E.S.P yes, fail. lot pump the than no, different rod the this wait we additional conversion Yeah, [XX:XX:XX] the Daini, they have do we in typically is we to little in

XX us that I think inventory. converted kind percent rod well eight conversion about normal we you we there, of to the the the on I the And know what you're can do as so know, think a predict for is, what Shelf, failure rate you we can we before far E.S.P seeing known [XX:XX:XX] probably get the out have also pretty already We but and we So runtime have just those we've as of about maximum are. run is rate six North-West know, on remaining per of quarter a wells. the

over the drops those down So, well as way. timing getting to a it production you put the well, They're total fluid it's know, we're feasible the and well when wells a a rod the where of point converted along to It's on to pump. again.

to times. at done the accurate the Central the you going of those the And going mark at can average, forty how economics On a six got looks investor presentation. mark. percent you'll about one year our one [XX:XX:XX] see So like, hit it that's we [XX:XX:XX] pretty plan different and that probably on built platform. know, in is year they're presentation the to points we're occur that's wells. conversion Basin The we've We've you rod

overall we've So XX done percent.

probably I reach because XX following the would Rod to never probably to of going XX be we be XX percent will Pump. producing say on happening in say that the higher to of XX mark to where over to the they're a quarter. the got put percent about another But the maybe they're than Now, others. area these get to point won't I'm maybe wells will They water and some wells of a

XX But, well will as we remaining. at percent as about we that drill probably right future, looking in course, the Of know, you inventory now, increase. we're a stand count

Noel Parks

talking mentioned costs for And one the rigs also look workover a additional little [XX:XX:XX] had workover rigs rate service and. what's bit point like we before. Great, you that about and you added thanks. were at day Well,

Paul McKinney

[XX:XX:XX] Oh, to dollars don't hour. about XXX they Yeah, know, sit. an run

they run say just let's So easy. it hour an day make hour or XX to eight

There's with you're know, probably on rentals at few that looking more you You twelve a Olian, XXXX day. looking costs like know, fifty at, a fifty, twelve the add you're all with.

Noel Parks

might where back maybe or and get just Well then [XX:XX:XX] much a where roughly down. two year a cost ago of sense those come a how that have year going or did ago, and

Paul McKinney

then, [XX:XX:XX] were probably XXX running they an to XXX You back know, hour. closer to

Noel Parks

[XX:XX:XX] Oh, OK, . that's big that's pretty a a

Paul McKinney

right? There's significant savings, [XX:XX:XX]

Noel Parks

sort But as different And OK, [XX:XX:XX] opinion that on of of mix options? some idea alternatives of way the of away line, I was last the at yield out one offering you the just the in your turning of and sort did other. a looking credit debt, know, have way of the my strong I, the high think from one, getting or way, don't the financing course I along a great. in really

Paul McKinney

itself Well, When opportunity pretty day events, it. felt presented actually we of needed considerable were advantage to a look I we options one sequence there's that and different you about. we so like number back of this on thinking the take [XX:XX:XX] quickly of mean,

Noel Parks

fair Ok, enough, thanks. [XX:XX:XX]

Operator

Bond question question. with may [XX:XX:XX] the from comes line Our Andrew proceed your Alliance who of next Global Partners, with

Andrew Bond

Paul, you for question. everyone, Good [XX:XX:XX] morning, my thank taking

Paul McKinney

Andrew. [XX:XX:XX] In

Andrew Bond

of indicate? a modest current some you off on tackling hanging, on more plan rig and activities. blocking [XX:XX:XX] anticipate Bohème per production and at picking some up may XXXX focus low You persistance production might hold development to what price, around next you fruit flat Assuming the environment maintenance look capex, current would Again, budget those current persists. like year, decline, the and hold Or rather day? as price into environment a

Paul McKinney

[XX:XX:XX] forward. ask we're Yeah, situated question but that's probably going and right answer to now, difficult our a how depends on to yes, liquidity we

not also our other spent things costs. different in less [XX:XX:XX] so call structure. efforts than little all DNA. lease talking the our only the pursuing that That's here, the cost the reduce operating out should not we expenses we done of our this is field, a making have about And to Some perhaps that but reducing time we're have we're changes still in

the preference are to going similar not we maintain Yes, assets decline will like yes, cost pointed that to And some And type But of liquidity. spend have, is conscious. of that very [XX:XX:XX] be we're our consider is year, this capital of we willing maintain so, out, we allowing these to next production we too be because it. prices much. So believe not decline to my some to our shale to we like producers. in like would end to be times willing to also

Like return of our And we actually so of opportunities to and all other if that. rig, the that said the we types our requires willing can for projects we other of production. a earlier, that oil We work to little do of rig. rates maintain pick exhaust be a a do the up I might higher But will. rigs we prefer before up picking drilling

Andrew Bond

cash generation forward looking with free to along continuing [XX:XX:XX] continued great Thank you. the and That's flow to on color. got follow the Ok, it. Congrats story.

Paul McKinney

[XX:XX:XX] you. thank Hey, Thank you, Andrew.

Operator

press your [XX:XX:XX] you As like on if telephone question, ask reminder, One to star keypad. a one would please, a question. Voiceover moment.

Johnson with the question comes Dun Rice next McIntosh from Our line Co. of and

question. your with proceed may You

Dun McIntosh

[XX:XX:XX] Good morning, Bob.

Paul McKinney

morning. Good [XX:XX:XX]

Dun McIntosh

Oh, one M&A just and the larger that private around or versus more of But talk be if anything smaller either little to smaller larger additional operators kind on. manage any with we kind it the Joseph could a production there any are of looking to you some deals kind might out currency maybe already about to as of corporate transactions whether equity just M&A, opportunities. [XX:XX:XX] a take the you through has. been or you out of seeing be commentary and that's looking kind if way opportunities from someone's I'm might sure has of touched see get have

Paul McKinney

can and I [XX:XX:XX] for cash. a say, There's Ok, I begin? do lot but really replacement where there's no

there's people spectrum, their to the get because a want won't receive everybody [XX:XX:XX] just they that really that of at market However, wants assets sell they end not believed price valuation the Let's it, at that of lot better this point. really otherwise face cash. a they could

were look we've has of are or of to sales truly the I bankrupt hands what and different assets when out transpired either that look these over close. happened I of the into at gone out has a are a so last equities couple all in few the banks And private few seen that and at quite or there. couple has and fail quite asset over it years things assets There there been last equities years,

that are We that other invest that also know, areas they you assets don't have larger in in focused have currently. companies particularly,

at get [XX:XX:XX] those next look stock, all of every probably start and like accept type believe opportunities, And the small, to down environment we're Well, take grow and you to organization going for and larger Now, to the plan different. our off myriad take And progressively these properties so for respect to the is potential will. stock willingness continues that our as with the [XX:XX:XX] long our it of progressively is we need company. we in build momentum, each today, up we as desire and or can and price when some then to look the larger is deal one.

to willing are it. consider Some

also And to requirements consider [XX:XX:XX] looking have to want what the returns. many places that's to willing reality that invest, because different cash capital. work. are people are dealing of not out just There And [XX:XX:XX] for investors absolutely in their other are They focused. their industry put with. it to Some more are the for these of capital we're

avenues at magnitude opportunities to the grow garners to that to the deal that And all are can so order meet also all facing interest investment we capital so and a structure attract the more and looking attract of market. us. looking the asset we're We're certain [XX:XX:XX] in that ring,

I You least, And know, we billion now. in lot have need goal that's But long a with believe market that We these bigger. are cap? of go. way discussed. is we there But The right a different we we a the all be to so various small. that have a believe at need be [XX:XX:XX] of to size two of to just what, company groups kind little we opportunities

is, all done? bring that table then is question. can the That challenge it. get your the we and the structure And the we parties so can to something deals And repeat

Dun McIntosh

Thanks, [XX:XX:XX] Paul. Absolutely.

Operator

[XX:XX:XX] back end the question I Ladies to have Mr. today's call answer of and the session. turn and over we gentlemen, would Paul like to closing for reached McCartney remarks.

Paul McKinney

you Laura, [XX:XX:XX] Thank who in call. you, and everyone thank to this participated

our and about the We This support. wind conference for encouraged of what is investors our the are Thanks call. and again. holds excited by future end your energy are

Operator

[XX:XX:XX] This concludes conference. today's

You disconnect evening. you Have this great Thank at your lines a participation. your rest your time. for may of

Ring Energy (REI) 10 Nov 202020 Q3 Earnings call transcript