OAS - Earnings call transcript Q4 2018 | Chord Energy Corporation

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Operator

Good morning. My name is Drew, and I will be your conference operator today. At this time, I would like to welcome everyone to the Fourth Quarter 2018 Earnings Release and Operations Update for Oasis Petroleum. [Operator Instructions] Please note, this event is being recorded. I will now turn the call over to Michael Lou, Oasis Petroleum’s CFO, to begin the conference. you. Thank

your begin conference. may You

Michael Lou

you, morning, reporting Today, are Good fourth Thank quarter everyone. our results. XXXX we operational Drew. financial and

among delighted Reform your on Taylor statements on by We’re team. uncertainties Please other our be you I’m that our others, materially our we Oasis including Midstream Private the Petroleum that have Commission, Act. disclosed earnings be statements. to our have today We conference in our and advised that forward-looking joined in these to remarks results members earnings within and as our XX-K of we Tommy currently our reports cause Oasis as subject and Reid, update could meaning statements annual call. forward-looking different releases and be filings well both releases from disclaim to as on Nusz Securities Partners, include, with including Securities These Litigation questions, calls. the and as on matters are Form described statements XX-Q. believe Form actual include answers that obligation quarterly the in the the to of those Exchange well any risks and report to forward-looking risks Those to

During reconciliations and releases on this to to reference be conference and in call, our earnings our we non-GAAP applicable can measures, will make found GAAP measures websites.

you our can We will With on which to I’ll our find call presentation, reference over turn Tommy. also investor current that, website. the

Tommy Nusz

our financial out diversity, and Those headwinds. against to strategy of portfolio the the us asset size for strategy call. prices well to of serve continues Oasis This job our in The scale, face quality executing joining a Good thank cornerstones laid are do and continues in we oil volatile associated that you strength. and morning, and XXXX. team four great

managed efficiently as now two to to ramp spending price our our with highlight barrel. more Taylor four demonstrated in prosper Oasis withstand last to our risks. free in on the and business designed wrap low have E&P inventory, basins, cash years experienced up flexibility depending cash and We flow per environments, the was business that provide key spans market of moment, which has points WTI to low-cost morning management our $XX want this to clearly workforce, regarding conditions and has we to and built even business in Our in given an up prices this XXXX ability down, over manage color management few the financial but I for generate the E&P year. a down to aim of will a flow you deep

performance strong gas to we’re our our Wild In as more First, aggregate, guidance. quarter, per in Williston Basin. remained asset capture XX we line day the averaged able and with in quarter fourth volumes wells Basin Boes completed midpoint in XX,XXX

processor about and started multiple to Second, December did production and increasing in a day the the OMP win tightness others to the gas own capacity. largest led second our allow early its XXX successfully here. team a third-party same. of its anticipate to million and for in total day using capturing contracts to stay their in gas allowed Congratulations production knowledge in per do gas curve great gas This Oasis OMP job gas to a processing the Oasis processing also capacity making plant sub-surface They the natural basin. to huge million XXX bringing to ahead

rate sheet. and program, projects a the field work that this the We approximately noncore exit team a service in target as get half the our hitting also executed our the will what our in hit and day. and and helped Delaware, takeaway so development year the financial Delaware year. can well while asset peer operating with done partners development. Fifth combination job Boes of is of our going integrate margins portfolio million Page we proved our high-grade this in of in out program our efficiency our team stand well asset had wins footprint per done takeaway market, full is an basin. prepare that cost our expectations, We X,XXX have a two continued major capital big well our difficult Third, delineation among our in our of has we successfully reflecting as exceptional which to second Top-Tier to and be ratio, our strengthen few our sales, which The XX expanded continues start as closed Fourth our to for strong day presentation bridging exceeded world-class balance a of capacity our recycle operating efficiency our peers. cash efficiency. group investor within – highlights $XXX productivity, managing

free Oasis generate in XXXX, XXXX formidable to significant by position XXXX. our a turn our generate inventory. we free Top-Tier to at flow commitment E&P capital plan oil is $XX by to lowered driven cash we flow to cash As With a XX% capital-efficient compared price,

lower efficiency in improved expect to service XXXX We costs. capital driven operating improve and by efficiency

Midstream significantly with in portion Additionally, Oasis’ CapEx arrangement OMP into reduces we’ve entered Williston of a new that XXXX.

discipline. capital returns conditions. market flow a and of prioritizing growth, generation volume through record positioned have over proven And cash volatile to company the track we succeed while We have

price XXXX, and above and execute planned on continue development of activity activity cash cash trading flow activity. source our we’ll for a to Delaware be forward, of leverage. Williston today, of the to reduce driver flow well to with to $XX intend fund free use excess Going significant free provides we a will Even oil

Bank. attractive up activity Williston will of expected year-over-year modestly Indian centered to low-cost, drilling was the With driving driver Williston major highly the depth and strong in two completions acreage our allowing company This to more funds no production a than at understanding a commodity for to slated the prices. second budget, our low position, and that a of to additional The inventory development spending drilling pick value Basin flow on with of slight about assets reflects strategy Hills, In fewer our rigs efficiencies United cash have which Our that be earn originally with also third for our to attract I’m outspend. lowest-cost year. the on for asset rig, sub-surface current Total us development concentrated core oil In account a be Red for hold Delaware and free the years generating originally across we decision XXXX, half Wild us two anticipated. delineating the and Alger Delaware outlook longer economic holding States, we come. and acreage. Williston increase completion primarily is while the allow will than XX% confident the is that basins expect returns Delaware, – to

differential the have We sector positioned With we represents Taylor. attractive midstream call the advantage. one best businesses to opportunity. companies over believe investment tremendous is turn in uniquely Additionally, that services that, and the of have Oasis a I’ll been competitive and a

Taylor Reid

capital we line and fourth across $XXX fourth capital for and should full expect Thanks, million the of completions. to other of deliver the $XXX quarter as program per between in XX,XXX essentially for net E&P million to Tommy. XXXX. of the in XXXX, year about spend The drilling XX% both of In about basins, with in as of with production Boes Boes day quarter well XX,XXX XXXX,

the different XX% implies a oil for the cut Oasis XXXX, few in start-up expected fourth gas quarter. cut to which oil including reflects in factors, to which average cut of of a versus Our new is volumes. plant, about approximately our The decline higher XX% allows capture XXXX

high in Basin, has PDP which more the growth a year. estimate base the Wild Oasis production of higher restrained oil Williston our strong program Delaware program, XX% on we some have the Williston high-rate year a steadily XXXX exit. which wells, declines, though development to and become part in about from shallower a now wells in a and Delaware, of Basin beyond. focused we’ll the program. that cut. which at wells Our even In These GOR declines our later especially which the in impacts oil get also has Wild decline, best are new XXXX, delivered Base higher the larger the was than base producers directly fairly exit first In

Williston, Likewise, As our quarter in our the or a and to three maintaining two out the on result, should from flatten next to running in we XXXX two five quickly adjusted program XXXX expected a world the oil activity that production drop overall plan $XX grow cruise. so. we released adjusted slightly cash have gone our rigs in to has We to rigs. currently three that are two are fourth two from In or flow. rigs based a generates free plan frac in rigs so month effectively even

result, about X,XXX oil depth average of a result, production our a per versus Slide to peers. year. relative we in performance and operated our key As wells investor deck is very expect inventory this And month remained as our of gross productivity Williston XX foot strong. our our equivalent Well position. XX cumulative complete strengths highlights well XX lateral

has you on optimization continued focus as Our high dividends, see. completion intensity paid

top oil pack of the basis. on our and at the Boe We’re on the

We results the and deck, view stepout XX from Page area in delineation are our areas that our encouraging. economic per below in validate which on see $XX drilled and three can trending well wells you are As XX Woods Painted of is XXXX, barrel. also various early

advantage Based and this around we been and wells and results, inventory. deep XX% monitor Economics back advanced Boes economical is sub third-party part the throughout positions. XXXX year have approximately huge $XX possibility Top-Tier with in as XX XXXX at drilling with improved program to per to we are day. South on X,XXX expect two and these year-over-year Painted certainly run to Cottonwood of of increase our obligations. has nine Oasis Delaware, moderator to at push drilling moved having Boes completion XXXX our and likely activity areas inventory in these X,XXX continue areas Montana the into to also these exit In select completing wells Woods While pricing expected a rigs secured development, to we’re have our the volumes techniques, are Separately, programs. and evaluating no

times XXXX, exit X for about an estimates XX,XXX Boes we would have per day. budgeted anticipated currently rate which in of capital the have prior resulted Our

productivity Last – and the We efficiency. and A continue upper to spacing with in as to well a remainder three-well to enhance progress drilling A Wolfcamp test a drilling two Wolfcamp Xrd zones, and we we Springs. in the three improve expect complete one design which B, year, drilled drilled we on focused and as operations the lower primarily C XXXX of expect as including with be shortly. The other will the the interval, additional program across Bone Wolfcamp we

We brought will an and test XXXX drilled and spacing XXXX. in to also eight-well production on conduct pad with another be in completed

Michael. in below This wells has think barrel, Bakken Williston we and to operator continue the to breakeven been As field outstanding the optimized productivity pricing In gross XXX X I’ll solid generally full we Slide past, With $XX which in before efficiency five or capital as below team team years breakeven XXX that acreage XX beginning we’ve move close, this and of productivity. the alone. move of $XX have direct approximately now the great barrel. it drilling equates In over like about well identified have for locations, to and call well, inventory. paces deck at over drilling that, field we Delaware, is operations. been said development. to to results the locations. the understand pricing full our integrating X,XXX asset, us years progressing executing important a going is on DSU stand In Top-Tier I Delaware, done on the eight our low-cost our year. closer we has would plans past To we this and development Williston At as an which inventory drive we gross across at in now Top-Tier XX to represents operator spacing full XXXX per to per with have the you our job to done job has efforts field delivering our of development. development of our Williston, to per and to locations the

Michael Lou

Taylor. Thanks,

the years the and of performance. year, through Delaware. operational in As top-notch in you’ve delivered our seen asset low-cost and high assets strong we past past, divestitures This base bolt-ons our graded a team new further series

capital used within drive created efficiency to spending, are We proceeds We help expand our great enhance Since the across XXXX, living a has XXXX, deep XXXX in of cash dedicated program. to generate portion OMP D&C Oasis to a E&P cash position and in free been in significant Midstream to flow. returns, portfolio, and divestiture finance flow.

down the in portion resulted spending which quarter, $XXX During million, $XXX million covered sale Bobcat cash Oasis and receiving interests common of fourth and Oasis’ approximately for Midstream OMP million in we sold the cash in The in DevCos Beartooth $X.XX units. XXXX. Oasis in

interest, portion fund is minimized total this believe Midstream. E&P and distributions beneficial arrangement EBITDA, E&P is recently our including business. and its ownership Oasis Oasis its turn The our As OMP for which cash portion of XXXX, free Oasis calls position to of in OMP, OMP flow. $XXX investor at increases free $XXX $XX a to to free between million million spending Oasis cash capital We approximately price, we of where current We highlights our its CapEx free on $XX Slide able as attributable of presentation ownership flow flow components approximately approved X mutually fair to growth cash the Midstream for from OMP, due value arrangement bridges minus Oasis to generate position a standalone CapEx OMP at of per the Oasis define of increase cash can Oasis focus at DevCo. plan minus will Oasis our cash Midstream and plus to barrel. WTI flow both Bobcat and is oil as and

is capital of the to projects. level, Midstream to continues Oasis approximately As ownership some a to XXXX, decline of Midstream In to expected XX% this Delaware result Bobcat strategy, from consisting primarily in Oasis XX% at fund year-end. by Oasis expect select

ramping XX% to to XXXX. activity. Taylor additional and of and a was the deals sign early able over plant signed, third-party completion OMP performing expect XX% up our we several year-end OMP for mentioned, the With protect expectation Oasis at These the contracts and is Tommy our ramp XXXX. XX% utilization second in XXXX its incremental and up Wild past despite With diversify gas third-party fourth EBITDA projections, to now we’ve to able was help stream, in As last of met update. by additional Basin deals utilization months, well revenue quarter OMP’s in reduction versus north increase

total to benefit and I million success And Going on on for flexibility OMP shortly. provided Midstream capacity cubic forward, operational release on talk processing day. our Oasis OMP’s of direct feet the our XXX stands color would OMP efficiency detail you by We’ll from more front. to a call also continued the in press more

$X.XX cost averaging operational the to the through exceptional per ended LOE in us front, And guidance XXXX. up year. lower On Boe performance allowed our

production We’re Delaware $X over relatively which increase low in and range quarter, expecting the fixed-cost to a delivering in refinery in Pad base of be LOE the $X a But the Williston can December. per in XXXX to differentials the in historically reflects somewhat Boe use of ESPs November X. per team increased and did pure our Boe the fantastic Williston marketing spread. against in crude that job differentials particularly leading backdrop fourth maintenance be in occurred widened high the and

last should course – $X.XX to the expect the the year. over the of differentials volatile, of online head crude $X.XX seen haul first we to but first levels area come. be have course in of to oil have for the differentials year long-haul into year. range of half years to last We – differentials new Delaware the coming As the pipelines over throughout XXXX, XXXX, Williston returned been In several debottleneck currently

transportation want Boe $X.XX expenses our our and in marketing per Boe range. financials detailed in and per $X to the see release will should revisions briefly press and our in Boe be to Additionally, per XX-K. the you gathering I to address that

interest benefiting our shareholders, As I an does price partners realizations, mentioned, owners. our royalty marketing work and our working optimizing team outstanding

For to transportation engages and transactions paired and our in within team Williston, reduce basin example, in given buy-sell low-risk the gathering size expenses. our the scale

net transactions a these historically basis. shown on have all We of

be both we of results importantly, transactions a period now will characteristics. our prior is given in certain the We making to are financial gross as in their our expenses, our increase Most restatement revisions and no do such financial change financial EBITDA, remains basis although showing net required prior on result statements, per strong. to and revenues they results, earnings no period income share. Liquidity

$XXX as XXXX EBITDA $XXX $X.XX times only EBITDA million lower $XX of adversely drawn XX. base to attributable $X.X Fourth oil prices, the carryover realized of total Our billion of year and under the EBITDA quarter with approximately full adjusted had borrowing December Oasis to by was wider million from for X.X to differentials hedge September. multiple debt billion is impacted a with Oasis attributable of net with Oasis million committed losses year. of

program, and Just hedging to for fairly around collars. those XX% of two-thirds one-third volumes in XX% our we’re at update well with forecasted you of on hedged oil swaps our volumes to XXXX

ceiling an to capital Our strategy should collars also floor XXXX program in protects WTI more average continue prices of upside have This $XX. to us capture lower price allowing about approximately environments, recover. $XX our of and while

steps, XXXX our To our strength. as XXXX well across great our upon team for executed our while our We financial Each size things asset inventory and base, a year our top-tier have diversify incredibly already continue sum fronts. multiple Oasis scale, to was of up, these increase improve begun program. building

call focus foundation As free strong generate back Drew over we efficiency, our capital base. flow, maintaining to while on the team for allows the through that, look cash asset our significant solid I’ll built, has us XXXX, questions. and to hand With to returns

Operator

[Operator from ahead. Please Hall Heikkinen Michael comes begin question-and-answer question session. go now first Instructions] will of the Energy We Advisors. The

Michael Hall

a if year. XXXX trying could flat just kind of was Williston of how into a back color the think that think if coming Thanks, first rig through the the of count kind additional half you carryover little XXXX, that of the the just play curious the obviously to momentum XQ from will completion to through normal trying the completions little the I’m your into with of bit I I’m and trying good in versus square of the with also XXXX? seasonality over to profile on cadence XQ provide kind course how quarter down, XXXX doesn’t just morning.

Taylor Reid

I we the winter is right in way. to Yes, slower going in is about a quarter. like normally the first you’re The see the thinking cadence think be little

So for the as evenly completions we Williston, we’ll XX it’s number talked wells said, range, quarter, Obviously, the I last had year. distributed. over it of I well online, may Tommy that of we we kind to us talked quarters of wells and pretty be less evenly and number XX the a quarter in not up spread help have volumes the across wells, first were like XX you’re the of going the again. keep quarter then you pick flat can to so and of well XX, just about about brought late the then but rest in three don’t that some spilled Like know into a will that’s activity first

Michael Hall

would the on that low the year And year oil the declining fourth kind little exit. Are are year so is a we of that quarter? when kind should be of XX% in as exit of you like the think you point through comes to trajectory, you the And oil bit, mix you Okay. case? course down flatten prior in you a there out, the would XXXX, growing the rate which to is out volumes? think latter through to quarter oil fourth of if Or pointed the the

Taylor Reid

Yes.

you the of the thing cuts quarter we last December. going you’re when on talked and So -- about like the on end in year, we’ll fourth more plant bring the And brought in that’s XX%. Williston,

of for the here for full month a and treatment so with year-end, capacity bit bit really first on but just that a new processing get a dip. quarter then quite a at you whole plant So more that

increasing volumes it went the down XX%, a at – you volumes the at there numbers midpoint you in XX% we and here about which symmetrical talked did drop If talked XX% as imply pretty just bit oil off then we the then will of of for Williston, Delaware. over get in a oil is year offset but the about, year-end, with

all of decline but exit, a oil, to drop bit looks about exit combined, a then the also different. talked So get in we as as XXXX that we into profile

base production as of XXXX, XXXX. be you should the decline dominated So XX% that wells, new into less wells that go be and that by the new is you about have in the moderates

oil will And us in so XXXX volumes that’s keep to -- allow XXXX. to to slightly growing the flat in our we think that relative exit

Michael Hall

have bigger as last are I thinking and then, you getting Okay. the of of granularity. flow you in about in guys back just to what to I some stepping XXXX That’s growth helpful activity still guess, Delaware back free XXXX, or may that really how position think Thanks. And need keep of picture, cash about the you holistically, context emphasis? the to one be acreage whole? kind sort in a potentially do guess, that And

Taylor Reid

whole as this you development going what to likely time. our this to activity said, XXXX you more saw year, cash And be Overall, levels we going certainly, from like respect do flow in expectation do flat. to we’re in stepped into as a environment far to for Delaware. But as And up at look we generation, then generate XXXX, going flow, going with the full in us. the I in, we continue can that volumes that that. to Again, expect bit that continue again, Yes, it pace we’re the this is close is -- or drilling that to $XX Delaware. -- free last year probably free as cash up, to to acreage hold the to the pick can the into close year from

world, a price generate activity into have opportunity to again, focused to going on higher move continuing If But, to it’s a free we flow. bit. up be cash you can get the

Michael Hall

And All right. very much. thanks

Taylor Reid

talked about in the number, As deck. it’s Michael that

look can higher shows You of each the X that’s and flow, of on at cash presentation. that the cases more generate we Page price that the free slide

Michael Hall

really appreciate it. guys. Thanks, it. helpful, I Got

Operator

Derrick The Please next question Whitfield comes of ahead. from go Stifel.

Derrick Whitfield

you discipline and Good respect it on strong outlook. the to Is your capital a apology to with morning, returns? simply that’s all. core With past the I to extended the could former guys very definitely and core behind a want results you the Williston, level change share thoughts name on from core Top-Tier? to us extended core approaching similar

Taylor Reid

Yes, no, the that’s, you’re on track. right

higher people that past on additional you between the than there if and core those the calling two If classifications three extended $X breakeven or just the we $XX, between two difference really outside of a so what that deck, see And Page stimulations the new, and you look had -- you a before years, And Top-Tier extended or the this we’re upside got are sense. this over had concept. was four made X core core way those was of these classified break core intensity we $XX acreage. below we’ve will core was lot

the over completions look, map are The the on wells results you that XX areas all Page to you X, Now of can and and there’s basin over that, see these well, I direct actually XX, enhanced bunch and really we’re impressive. all these now calling a pretty as of XX. you the Tier Page yes,

in since Woods, for XX, the Page there see all Painted activity Montana keep how basin that in Painted Cottonwood, is the completions to of the test done on so operators And all compared look core. more most and XXXX for in completions will South are Woods the you XXXX. in for you plus completions recent recent in our mind, If

favorably. So compares it really

more So of Tier peers. really we to which just single this expanded think also basin and is going that bigger the in line are highly we our over think concept, part with economic position a is

Derrick Whitfield

Got it. you, up And a just sense. makes for Taylor. follow That

close enhanced you practice? your you to on to completion you’re to what Slide could how for are referencing timing would designs South and XX, those best test on the consider Speaking potential also Cottonwood? Montana pre-wells planned And speak

Taylor Reid

most everybody completions, you is this gone the operators they’ve of got most of pre-wells, to like for different the core look intensity that but And activity the those different has kind has at change. since been in concentrated then So a of slickwater. high of sizes different variances exact and lot things when the part, doing completions, those are of and XXXX

So much pretty to the also has seen and a made at completions. perf shift everybody that in completion high this and point plug liners intensity doing

So pretty been representative what doing. we’ve a we think it’s of

I think competitor. good a So

South wells additional drilling of terms evaluating we’re in In and Montana Cottonwood, that.

year And Painted it’s so this year, what happen. unlike in we This -- that or not sometime next you’ll see probably did Woods.

XXXX, saw has remember, we better or good seen an drilled we results in and own and area. then Painted in guys our the And from of moved we what we saw -- you wells, up Woods we as in additional into If went results Tier inventory moved it based than competitors. the third-party on

for Cottonwood expect both South and can similar you a approach So Montana.

Derrick Whitfield

comments. your Very helpful. Thanks for

Operator

of next Please question The from comes ahead. go Cowen. David Deckelbaum

David Deckelbaum

control? consummating deal agreement. the Should we that beyond? before think this and threshold as with could structure curious I’m CapEx perpetual guys. question. thinking on losing of into to congrats done about you’re ownership Thanks taking how effectively guess, be, get sort you OMP with the on about would a Good you my I going until turn Michael, morning, XXXX for that you

Michael Lou

David. that year. for for only This is arrangement this clearly Thanks

how level from the the our think to back that’s that about free we flow. parent to or into cash E&P we is standpoint an what to go We And past want capital that, have in sheet go However, program. spend said Oasis either at want spending continue we it. to the balance

for on now, arrangement level. a expenditure thinking that’s we capital down part, most how the the kind spent MLP like at to a it. Whether settled through So midstream we’re want it’s be we do of it’s or drop capital about

about So that obviously that we’ll And sides. it think see for as be both win-win We how well. and XXXX and this continues a beyond will sides it’s continues, think we to for work great. for can if both

David Deckelbaum

about thoughts And and, That’s talked XXXX. growth into Taylor, on helpful. some you oil gave that. Appreciate going just oil mix XXXX plan the the to and then on

Delaware? And adding some to sort be do Williston of guess, the way, world, another expense sounds at activity beyond of a point sort see at of Williston? the what like capital you going come sort In an $XX allocation the capital that that level even your planning XXXX? Delaware Or does becoming I in you almost of would now high on

Taylor Reid

Yes.

around we program be question to first the is similar. to if continue activity be at So going Yes, $XX and fairly levels the Williston. world, impact on the

One in if on are of deflation, world, to execute being the a to think able that’s so mind to $XX that in program. you’re and similar we see things we a going to continue in helpful keep

We in also efficiencies on continue to down that that. cycle on that But and cost, and made our it to a improve especially to got improve year, will early bring the been and operating asset. for times have expect strides. path a We’ve continue would Delaware, now we’re we’ve good

But it’s and to might how little the be lower world, we price to up at I it don’t a in point, we’d pick so numbers directional. as It’s activity, don’t. a big more Delaware, be that there’s in going of it. won’t this yes, of activity offset about as but same overall cost thinking that deflation, specific some be impact, make otherwise efficiencies the overall have then that’s just in benefit just program. so is also if And there terms

Michael Lou

well. about Taylor to mention the And declines to declines starting his in flatten remarks did earlier is to David, that base are -- the add something as prepared

there. need over a levels capital as time, maintain already to It’s as going to got continue about. Williston inventory to So base great talked much production we’ve the you’re in not

to less think maintain of it towards and to originally so And with flow capital. that free re-allocated flow before can itself. less a cash free that we gets lot we some It’s going be cash generate Delaware will

Taylor Reid

is point. between that’s give on in far for out capital view to be us it And the really how two a years then going as and to that at before as, even a just number well, you’re this spend basis, long of

David Deckelbaum

the color. for Thank all you guys

Operator

of Rice. Johnson ahead. Mills Please Ron The go next question comes from

Ron Mills

little B, doing, some guys. like Good maybe testing color year XXXX you all zones for in Wolfcamp the morning, additional on Permian, and Taylor, with co-development talked is other in potentially of you like delineation the Bone did the especially what And this provide also Springs? start upper terms of you’re you the you, of tests? more about A looks just test the along of bit the three a when lower the the Xrd in

Taylor Reid

good it’s Ron, point. Yes. a

all about. with that But wells with interact important some we Wolfcamp X, the interplay forward. block look We eight-well going that get B, the stimulation drilling of are we’re individual they program in a like about, intervals in And We you forward. number C, to how the test to and look the will going spacing going intervals of spacing, how together and and all that’s really interval XXXX do for a spacing talked Bone those then will different development us, what talked and doing. as type Wolfcamp in beyond more of to eight test understand we pilot those of Springs like to we a want see

Ron Mills

do the end and you XXXX timing, of is you this over terms you of hand by think in course data more that a year something program? Or your in full transitions And that look plan? you to XXXX to co-development formulate move potentially that the of of have as enough of will really

Taylor Reid

to XXXX. going get Yes, be results as it’s into we early

important getting recovery and like that efficiency, might really continue the also resource we’ll go. full into work cost It’s So the evaluate development as we we help efficient important really to to it be to But year. pad bring in from more into continue capital standpoint, later doing operations down. pad going from to of is getting time you cycle just but then

Ron Mills

do in a to targeted latter and you longer-term Okay, case, did are in part the cash And flow you more last the great. -- kind what to like do that’s of what’s free I Michael to how And on you’d the year to you, with My the use of flow? bolt-ons opportunity is versus what the Delaware? the free achieve measure that And have plan that cash ratio cash the flow? the then do or leverage guess guess, for side, you free debt. paydown if similar initially to

Michael Lou

increase strength. need the Yes. always for Right our in times is to we’ve to of debt-to-EBITDA now, oil it we’re way that two a financial And continue we’re about kind shooting talked price. thinking we level about a normalized

So two normalized going that a times. call shoot to under it kind if we’re is you a that’s $XX $XX of or what oil for basis, price

what well today, so $XX generation, in different -- might trying free look might that and $XX service we a about in like maybe in as $XX, those like those as cost flow tried a show so be around cash more where bit environments. different you’re it think little thoughtful and being we what to be in to world, And $XX, scenarios,

So this kind perfectly debt looking you’ll CapEx necessarily of bolstering with point. ratchet that kind inflation of but and paying as we’re really sheet notice down too, don’t the EBITDA up on balance at those as at adjusting with

Ron Mills

Great colors and milestone. Thank you, guys.

Operator

Please The RBC Markets. Heffern from ahead. next comes of go Brad question Capital

Brad Heffern

guess, the thing this option? neutral are everyone. plan. free plan about versus kind XXXX kept to talk a or morning, the even the the Can I of this oil Hey, maybe a have just cash would that being flow you plan? on same the benefits plan What other led what versus of flat maybe for

Taylor Reid

basins flow the that free could apparent add, we’ve a Look, really was cash start The on focus of in -- continue a us out, we to like the keep being proceeds. to And flat it which a just our this efficient And a and we as think, had I capital work use a focus volumes great had inventory got cash it we program program, minimum big we tremendous. is we but something really of free generate put Tommy’s big think to flow. thought allow became neutral.

Tommy Nusz

Yes.

going position can to a going place. operational in all lay more I back for a great that keep think aggregate flat alternatives, on versus as make the financial I sheet Michael the balance and short time. dollar sure about that we just volumes alternatives in next get place to flow generate where think, free to long firepower. term, it’s it’s And the providing an it optimal can mentioned, bank to the off having you we basis and been cash a And be. We’ve talked

Brad Heffern

inventory some guess, that. as Okay, to that And make lengthens a I you the greater potentially obviously you life inventory? of prune have the for longer-dated some thanks slowdown, to desire extent. Does that

Tommy Nusz

flexibility We’ll sure. see gives market you is. how It the for

Brad Heffern

thanks. Okay,

Operator

Nusz closing question-and-answer back conference to our the any remarks. turn I would like Tommy over to concludes This for session.

Tommy Nusz

free Thanks, in long-term it continues our our To to our delineate Delaware, with accretively footprint, for while price Williston, our grow low in In the the full-field up, position a Drew. inventory sum Oasis and driving to we deep on environment. development. allowing execute plan generation cash efficiency preparing cost low continue capital and for

to We place in all strategy look stakeholders. have joining and of for and team for the our to call. again Thanks the succeed we forward our delivering

Operator

now conference attending has The for today’s concluded. Thank you presentation.

disconnect. You may now

Chord Energy (CHRD) 27 Feb 192018 Q4 Earnings call transcript