BRY - Earnings call transcript Q1 2020

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Berry Corporation Q1 2020 Earnings Call. [Operator Instructions]

I would now like to hand today’s conference call to Todd Crabtree, Investor Relations.

You may begin.

Todd Crabtree

welcome the and start and the apologize Kevin, in delay this you, to we everyone, for Thank morning. Thank Berry’s you First for Quarter Earnings for Teleconference. joining us

with results Gary Yesterday XXXX Cary the the financial caused and earnings oil issued uncertainties Executive issues Trem afternoon, to and President. release operating COVID-XX Berry planned Smith, Chief response first highlighting and and by CEO; quarter and our Addressing Vice price Officer be current Board an our and and Officer and will these Grove, this and Executive Operating morning Baetz, other Financial President; Chief Chair Vice environment.

Trem the on are addressing will and of year. times Gary issues unprecedented the operational and how we and will response are discuss details to financial currently then facing. these further remainder plans for we the Cary Berry’s share

Trem for a Before questions, concluding it will turning remarks. make over few

attention laws. found securities to These risks those earnings outlined Before today’s materially forward-looking call our I safe projections subject and federal the statements your to statements The release. the earnings or other within language we uncertainties meaning These expressed want differ release statements. in filings contains our implied certain of these from the and cause actual other risks SEC. that include and may are to factors harbor discussion with begin, results and in in to

release recent analysis and date and Our release contained website, presentation. of most reflect the or earnings on information, a presentation, our our statements in the has that made including call made. the this bry.com, to link Any investor as forward-looking earnings

as duty law. to have by We required plans update them, or except no

GAAP website reconciliation our to related on and all measures today’s the call for the tables adjusted earnings release Please during mentioned refer measures. a and between in our

website. Trem will post over also our link transcript turn CEO, to replay the Smith. I the now will on and this the of call our call We

Trem Smith

today industry, families, for and sincerely earnings and Berry’s a for world’s for their I joining the This your Todd, for is time thanks and us challenging ones our call. XXXX and first you loved well. and are safe you, Thank everyone hope economies. quarter people our

The continues tirelessly market during dynamic environment. unprecedented team this and entire to work Berry

of pandemic team’s the is with it impact are proactive response created our the how aligned plus and to and We the Today, business both OPEC our I’ll our values. core proud and model COVID-XX of oversupply. response completely highlight

value our can this supply has has we for caused oversupply on business cycle, by the initiated Our the last through destruction Since lows including dwindling global intensified excess caused dual a the significant and our any impact create average. by call, and do one, the impact so. the is Arabia world. earnings is had around demand The we on war by of oil COVID-XX demonstrated and historically is to a market Saudi The and capacity, world storage by designed XX-year driving shareholders price have to changed. Russia economies negative prices monthly

$XX around cost our and our by per barrel. spoke cash in the free production free improvements, continuing the flow value remain creating Today, production, we management, is February, reductions When price was barrel cash around managing generate cost widely price Brent process focused volatile per capital, of to and on on and value and focusing generation. Brent $XX for of by focused flow. Still, long-term we creating on sustainable, we growth, last return late through and of were shareholders

given without not strength people the and As intact. their our Barry health will of Cary will describe, and had the business, position with no to cash The could do our our or strong priority. layoffs remain on date. and substantial year we’ve hand our our of liquidity families end financial furloughs employees nature and highest and this our company safety the essential of We

on can corporate employees online virus. we provided wide, March, the training, protect, how the recognize, In our spread and of prevent

oilfield protective safety working and taken For measures we extra in their essential following procedures. precautionary hygienic and ensure operations, our to all distancing have social personnel actively are

actions, employee our this storm company, have positioned cases our therefore, We are COVID-XX in operate. strong, of where to our closely competitive and the planning emerge from and and the we for of Centers position. following the had COVID-XX. report and well monitoring no to I’m guidelines state Prevention, local Disease employees and happy as governments federal today, Through weather Control and proactive and that decisive situation we a government, the And

In addition, we social alleviate in have crisis. the impacts of help to unprecedented communities our recently this and nonprofits made donations to several economic

XXX% Our projected XXXX first in documented we of our of price The pleased $XX.XX. details was indications we oil results I’m that the press as cuts, hedged in that are and our release quarter remainder our Plus OPEC soon of expectations. got at average production first Russia production, the met an XX-Q. very well resulting the balking as

production of currently you to We in wide. advantage we of per XX% could $XX our past, market approximately also light manage trajectory of corporate taking unchanged. that remains In $XX for the I we barrel. to for want have our levels year maintain CapEx began that the low prices, our the production our stress to told guidance decline rates,

did than This in preparation on environmentally later state for to in and quarter, potential and for permitting A ensure less spent that. was portion of our maintenance, year, operations. the preventative expansion significantly clean, ongoing it and we facilities, capital

that events, affect the into XXXX. global business crises convergence well quarter Although could these we impacted these our first results our significantly were of not anticipate the ramifications by of

organizations Berry of through led a team The and seasoned management number downturns. teams many has

the to know, turnaround the past will full will mitigate help how our around. implemented that experience turn understand during strategic cycle plan have advantage Therefore, use one. the preparing knows We to when the market impact one will We returns. Berry that downturn, through We navigate while take or the us do however, a occur. to we when this no

exceptionally we through declined and price, our process have positioned our has product implementing this. management and is value of handle well Berry Creating to our improvements. long-lasting reductions, value been cost sustainable, cost due created Whenever always to value mission. structure has intense

This than slightly our now. XX% cut last Since true a is announced more to we our capital. call,

We numerous suspended processes. cost have now, improve our further dividend temporarily Right reduce XXXX-XXXX and set that a plans developed for implementing contingency will and teams timeframe. are of our projects

Many to of projects cost will structure. in enhancements tangible, these sustainable our result

addition, plans, cost-savings contingency efforts In planning discuss in will our to only of we if implement with as storage. as few examples moment. to in a our well Gary deal will access have needed shutdowns managed curtailment which we a

Bottom strategic line, decisions. allow and generation, us and our liquidity cash excellent to make thoughtful

lasting, not be and negative decisions consequences people, will that our business, have unintended may impulsive make environment. We long on the our forced to

Oil Utah, and to of gas we than Colorado, initiatives, important collaborative have more our clean the safe, and operations our and advance and environmentally with continue governance governors agencies California. as relationships and managing operations, in California. friendly, It maintaining been policymakers, ever especially and environmental, is deemed essential industry and an by regulatory that social, supportive

plan. a over will our distract not will the will defer not management Gary. I it away downturn obligations, and now idle citizen from well we We us shy good from turn being corporate to our or including let

Gary Grove

you, Thank and Trem, here. being thanks everyone for

will always but can our what previous are it line our first out I and will with production done, controlling operating results with line do uncertain continue very times, We Berry in and quarter. we in what control. are has that point quarter in expectations the to

and found can XX-Q. our be details release in earnings Additional

operating and quarter next are safe the our OpEx, entire moving but beyond, focused capital, onto Moving remain we including rapidly things and to and our cost abandonment, cash structure, will on compliant. ensure managing are operations

quarter. wells drilled for quarter, two fourth fees half in were delineation, facilities capital XX for sandstone in the the the equipping and and XXXX, producers. the Of nine drilled online about beyond. and first the for We and the XXXX eight to more well injectors, We which XX% bring wells, for spent than was total of permitting were quarter were year about capital of for XX%

projects in the first facilities price in we started mainly last to that equipping periods this and higher at cost That year felt prudent end the complete and for of quarter. were

be in decided next begin to intense to our program proactively once began quarter we an we Additionally, permitting program. drilling the ready

XXX the remainder focus today, XXX than permitted more As subject have to the latter wells in the through market another moving California plan capital we plus and of the to of Currently, this we conditions. system. year, of regulatory half

past. half efficiency calculated the Our be of better than for XXXX capital in the will first

will anticipate we capital forward, historical levels. looking that efficiencies to return our However, more

For current than no rig capital sandstone drilling that prices. have XXXX, of updated contracting projects budget one primarily context, September the for strong returns at assumes development earlier

business our can the next into As capital we line get few more accordingly adjust in with we months, clarity model.

year ARO. spend million management obligations abandonment plugging or satisfies That plan. For well on $XX and idle full we plan the to under XXXX, our activities, California mandated nearly

We be our social, will diatomite and operations, processes of leader our operating the of showcasing environmental, entirety to continue the safely sandstones governance methods and both initiatives and assets. in a from producing across

the tied demand about differential XX% Brent the California Brent. a and directly linkage sells Vista, markets, crude in financial Berry or due widening of of Buena and its either California to significant to prices This between impact at minimize Sunset, California. Midway, destruction oil with will

that market impact price to is seeing. the to WTI so heavily same Brent, we currently not because we are And seeing pricing nearly our the

more to levels over We as expect to bases return increases. time normal these differentials demand

conversation managing There’s curtail lot COVID-XX, does Though with currently storage in storage during proactively period. due risk intend our demand to not situation. of associated destruction economic to been have been to production a around we mitigate this Berry order

third XX,XXX Utah. barrels Currently, approximately Berry storage of and barrels and between in has its available existing in infrastructure options, XXX,XXX party California

have We to California barrels as at option party additional and an such, storage this in XXX,XXX time. are additional third on source continuing an

California jet gasoline. here primary X/X its to oil. California storage in highlight potential and like on that I’d storage, really the particularly is of fuel is the refined issue imports problem. product centered And

state the you domestic imported production. have oil, storage If for plenty of should exclude onshore

of there’s In crude to estimate ships domestic through coast, XX were normal off Unfortunately, churn excess months current of which several the could take for anchored in California of that production. containing days the April, part there rates. storage times, we XX an run latter at

drops to rate, be for prepared off gasoline the curtailments. production whatever Gasoline at want the domestic there point high inventory built to to is the coast we or first happens lessened a capacity storage where hits inventories risk so have – recently

the week, That slight In news. seen gasoline good is in really we’ve a demand. last uptick

anchored yesterday, inferring Additionally, is ships XX of as showing coast, California Bloomberg is system. moving the of crude only the through off that

a will area key of we focus control as be move Cost forward.

to process on and concentrate continue reduction will cost on safety improvements. and efforts We

our projects. or delaying at eliminating operate We and appropriate, longer-term where reducing base certain steam properties will cost levels,

too this in of It steam be conscious the much thermal shutting we evolving to the is very ensure our the are are need periods. impact important to but long-term all our period. materially damage to reservoirs do note time during sub-service that we during these performance teams of working of not Things

We most at want and to make decisions, the the all using data of any available time. to us programmatic logical

company; servicing, reducing contractor including costs. labor chemicals, steam cost the again, long-term computerized examples looking manage are, both implemented those well very that cost our in reducing overtime our or young continuing and across utilizing costs, work we’ve maintenance maintenance or system and either contractors; of to overall development processing remaining Some new very company controls reductions; rate delaying highest to and and areas our are mature; in for optimize categories,

working that I’ll Trem are these it with And just projects over that referenced few Cary. are numerous turn currently. to that, we a the now on of And

Cary Baetz

Thanks, Gary.

providing a we in that Therefore, I’d and are tremendous the changing are valuing point with are things flexibility. rapidly. is and very ourselves important environment our to like We cash dynamic make most

The will maintain is see and on down, until outlook flexibility. manage and our to uncertain coming ample ensure demand we improvement business visibility we supply we

that repeat information not XX-Q. most earnings in our can read you the and will I release For part, our the financial

expenses, three The long-term touch liquidity. are areas sheet, our I’ll balance the on and

As our and efficiencies. out, both cost we Trem and Gary pointed are improving on our focused have

to challenging process enhancements. that to and our was times. structure plan will while the from off continue focusing robust a good in pay This have on cost up bottom’s built We improve

X, great more late These March and measures of as highlighted not capitalized On I’d we process. that we place April have G&A started Also, has to like historically Gary costs. a reduction. to and take Trem deal our G&A in in out, Berry highlight pointed

of XX% capitalize less almost G&A costs. many substantially our currently XX% we of G&A. about than fact, of is companies industry In their average This lower with than XX% the capitalizing

provided Another major us higher skews with stronger is Berry difference has the exclusively plays margin. between almost we cash a and oil. resource our historically are but cost This

wells analyst X,XXX make play than more would I on to the to bring thought have monitor, a this and companies help we which after reports more many Additionally, apples few I I resource means apples up employed. reading better a comparison. investors

that a I we want balance strong reiterate have to sheet.

have We are availability RBL. building cash almost under and we our full

today, $XX matures In as in million and mature term less our Berry we our drawn. until maturity as fact, faces debt near credit of notes XXXX have facility don’t July than XXXX. of no revolving

through well spring XXXX still moved the borrowings we a and position and no very us going hedge concerns, towards have revolved. through end versus XXXX. our our are But the us as had banks over We the line. covenant are line, little redetermination well collateralized We on the into of protects

current environments. given Our come borrowing will base price probably down

fluctuations. three years, capital than are not using we occasional planning working the the or However, line two short-term other the over next on

adjust will allowed Prudent stabilize our us us fuel to rapid to be to and through budget allow XXXX hedging oil continue to gas imply, purchases. this flexible actions cycle. Most prices our

had As of XX, through XXXX. hedged approximately with XXXX, day per per an barrels of at hedged approximately barrels March $XX.XX Brent XXXX day X,XXX for oil at Berry XX,XXX $XX.XX additional Brent

our to of also XX,XXX million our at through to X. $X.XX We approximately is Berry’s hedges oil hedge hedged per current into been adding XXXX. an day have now have better book purchase $XXX XXXX May price cost We worth gas of October Mcf. an average MMBtu as manage

the All to of hedges shut-ins requirements. purely are across It’s happening delivery that no with financial industry. instruments important are our note physical

have situations Gary the on explained, adequate and impact on as more any than to impact manage believe to to have able occur. shut-in, demand, these we be not have had we we excess While storage supply, differentials the should refinery

our We have at this time. dividend suspended temporarily

bonds capital, repurchases However, include market, still to and environments, able maximizing value to we $XX on potential million now the of capacity. open debt be our of repurchase even board in believe have current up we provided will us the return we’re we opportunities we which depressed which will of shareholder full still the as with – committed authority the in have to

Due took drop indication rules. Utah upon on non-cash charge we an locations. a in property significant our a is of California and million to long-term prices, pretax, properties of our particular impairment the accounting $XXX required This but oil simply value based not charge

end on our highlighting will I liquidity.

us free of of manage end flow. lot to the flexibility cash approximately on to We $XXX generating expect year XXXX. how million excess leveraged gives This a

levered are partially position. with in upon based XXXX strip, can We on hedged and the year-end impact little current we cash flow decline XXXX manage the our free PDP

scale can The the we same to or XXXX. be to in position short, quickly In said very a good survivor be have a about up flexibility down. and are we

Berry the know the market when to will improve, are in for position best is While when we that day ensure success that comes. we working don’t

to back it turn now I’ll you, Trem.

Trem Smith

world anticipation barrel we Thanks, started the to and nearly and Brent date, poised year that XXs, growth. of per certain year advantage the at the year first in $XX the end of value to healthy Berry will the with Summarizing but upturn. We this changed and Brent low a of of price take finished the a with Cary Gary. with year quarter the great

the context, I sentiment, to in and would remaining make comment the that oil briefly California. of on In of importance XXXX sector market business, energy a like the

price up over Gary hand pick permits system a plus rig to California year our the increased through in mentioned, last moving another of First, and regulatory when we in the permits And on to the our We have speak. third quarter permitting couple spend as is weighted as efforts XXX for months. the we plan CapEx improvements. this first we in quarter, contingent current oil heavily late XXX

and through permitting have will words, In plenty wells drill. of downturn other process the works the to we

new late You may impacted put high-pressure last joint projects. thermal Governor our on only operations a high-pressure moratorium CalGEM-Lawrence also while Newsom cyclic-steam Lab This new Livermore recall was diatomite all cyclic-steam that study conducted. year projects in safe with

by proactively led is CalGEM, engaged. Berry now study, underway and The is

discussed with team on team diatomite and study May practices. with thermal best met remotely our X Our the processes and

later the this We study year. are conclude will hopeful

The discipline accountability of up lack sentiment. past it. catching Second, market over with years is the capital industry’s and

downturn including in a opportunity an activities creates see consolidation This lot of for continues. will We the Berry. changes, restructuring as

The This through XX%, its Berry, will distribution markets global surplus recovers. Arabia of from and refining transportation includes on work than other mainly, California system from operators Saudi way deliveries in which California-based and waterborne more energy Energy from oil for nations oil production the OPEC demand Island, needs. the but as and like its is dependent

other the that the goals. the now and and with nor its clear well-being are Arabia California long-term aligned is of It not OPEC environmental self-interests members’ Saudi state’s citizens,

hand, producer approach, many On be our growth. than safe, market our and a flow of other we and oil value of for first clean Berry is and Berry fellow is will a the better on the producers cash positioned when California proven, recovers. focus in With in our position

is an people. the and foreign energy dependence part together oil. risky its California’s with By for of reduce energy providers, California solution more working integral sourced can than Oil now, ever, renewable on we

as we and that strengths, a as and on perfect altered definition, and The plans oversupply well redirected adaptability, understand demand be quick, flexibility, are light ability Berry’s resiliency. including situations to or a need shine by Finally, storm make dynamic as represent our to global change. cratered our informed may decisions, and

is our regardless have for maximize flow Managing nothing position new fluctuations. cash flexibility of will we to market ensure great We Berry. cash

it eventual capitalize market we the the will to to manage company historically improvements. we’ve is demonstrated, ensure on As strongly positioned

benefit I’ll it efforts. questions. will for up now open you and from shareholders Thank Our these

Operator

Rice. Charles [Operator comes Instructions] Meade Our Johnson question with first from

Charles Meade

which curtailed of you I addressed – address us you But your reducing so me remarks can rates. I no made fall delaying that as mention maybe couple can tell And and I shut times some apologize what during wells. a whole that well. team under asking something you curtailments to tell just you And you if the for was May you I us shut-ins, apologize, degree to already. injections, that June. it you understand prepared I’m interrupted in. seems maybe no perhaps have think you you’ve But level Trem wells could could morning, Good your you’ve And there. But steam for and to

Gary Grove

Charles. Hi, Gary. This Good morning. is

actively this single as every we’ll from at So that at shut yes, not economic anything tell in we basis not at produce have well any we an down we it a you will time. whether at do not I dollar to well look that with and in given example, for well rod especially failure, if – have We bad mentioned, or an or want I determine time, something continue point return goes goes part, that expense a pump down production. we today to to that that. to or like spend well look as

And continues. see time. some to in have as production again, at that time But not we this original we impacts might shut proactively back this small going comment, of my

we that to reduced certain on that A are By particular lot producers. in well where how conjunction control of in with areas. the to some steam want yes, that, goes Now, we side, those surrounding oil in and in we do. particular those sweep steam steam injector steam some have inject a maybe to profile

at long-term impact, where though, reduce date. to is steam we that more that the will, immediate reservoirs we’ve look I if done or you that think we can areas any won’t So importantly of And themselves. have some to

in least now, or we’re probably plus second quarter, quarter, taking millions we per a the mid-XX at probably reservoirs. say, advantage minus, And XX as about and the at MMBtus looking into earned day. in or we’re initially would of going forward the the that right we’ve million minus, day, So all burn look plus to of I

it’s then just Because from is that you very area example. this. with to online, when injection. it those is sub-surface long-term And look thing try about continuous shutting has that at back want I’ll we careful bring a conclude And standpoint, to the relationship. not as an the linear impact When we most the reservoirs in the be

Did in in to more answer same shut do for So if and month you There a example, steam you expect production to for rebound are come a as steam a see you? month, couldn’t the level. that complex lot your to just an inject when reservoir the simple issues you happening question back for linear than a were online, relationship.

Charles Meade

That great follow-up particularly of It date? conclude of and a that, at storage Thank relationship guys are that is of role Gary. the on is of was this I is not we should if – lot the sure guys or detail, you the of My evaluating storage mechanics a around should don’t know for gives or that you storage. with lot into non-linear kind that time spending producing you into but I’m Or steam. option worth that actually kind sense. envision suggest you? that this that makes barrels does selling perhaps not a the we that then later question

Gary Grove

sale at to on what think of each time things. facility. conditions and production be at a we property trucking. it the the on at sitting what I’ve those party got I to Charles to to the expect storage later options that One, that conditions pipeline and economic is through we through caveat evaluate for intrinsically that’s some the market, keep and storage intent or period then two And market two, is Always have, And our particular correct, either third future. exactly we to see our date. depending have take a online storage and it. in combination

Cary Baetz

Charles, Cary. Again, that policy an it to basically serves hedged say well. well as flow. extremely we’re for and free XXXX this maximize we as cash I’ll want is insurance

us be gives sell that to store option and it. it out, able blow differentials see an do we if that So to

Trem shoots on demand. to we’re improvement starting see out, green pointed activity As of

be we wide comes demand where see a we’ll up, back of hurdle, couple months think So, a could there differentials. as

cash the So differential it gives us the the flow. maximize in flexibility to

is as So policy well. it really an insurance

Operator

with Dechert question KeyBanc. next from Our Steve

Trem Smith

morning. Good

Steve Dechert

any CalGEM wanted wells. of gotten indication guys diatomite way on might be their kind have Hey, thermal get which might they to on good from leaning morning. just I you

Gary Grove

Trem, why I’ll that quick you don’t start some… and add real

Trem Smith

will. Steve, question. for I the certainly thanks

industry in I news very their do in remarks, mentioned continued perform to downturn, is this the good California during the As job. for CalGEM what has really is and

Governor that November the for So moratorium remember, only last just announced projects. the new is

So thermal the question And manage addressing of steam, diatomite. right a now, on fact, existing et in not previous it’s Gary was how impacting of to cetera, – our the going any addressed those. lot we’re

however, new moratorium are The projects, those. for this have in plans we and

proud team, Our very of team. our I’m

first all, it’s skipping Our very we remote a paper shelter-at-home at but to work. practices. call outlining this our the technical without team, Lawrence of and over went we from went CalGEM, request, We long created technical office work XX best That in work to pages Livermore paper. timeframe, extensive beat. And includes that it to white a that a technical

supportive. And we are very so

diatomite. We’re safely only company thermal we provides how And it perform and to done them that the have with that. data insights with of actually the the

the of is I moratorium. we’re we proactive point table and being ultimately, CalGEM of progresses when head my study So at we and out come guess look very the that to forward the

where pleased and point. CalGEM are working very are together say I’m So Lawrence this and that’s that at Livermore well we to

in to meeting, like the few so So comments that. technical the to we’re have encouraged. meeting, add he a was Gary may he’d

Gary Grove

an all the and They’re of the the gathering I currently study interaction together. that of Steve. all data. seven. And steps best impacted CalGEM would the by – operators with that there add then individually of would to morning, with having are approximately applied. data, them lab again, good initial be put with was one-on-one And are good. will and the add operators, that very and which conjunction the the those are together just then being just practices next in correspondence with meeting all have moratorium, meeting take each operators continued of I for

timeframe happen. prior love when remarks I’d is on that year. to to But to you end just conclude Trem earlier tell that see we hope that and as the I’ll far As the might goes, rest made of back if

Cary Baetz

And our something. XXXX. Steve, say for diatomite don’t in everybody, have to have Remember, we I thermal development budget

it or that. talking So we’re production anything about for doesn’t our like anything impact

in to make access the and We’re impact it beyond. it XXXX, doesn’t walking through to budget. steps XXXX we have But the that for sure

Steve Dechert

great. That’s the color. it. Appreciate Got

Cary Baetz

Thank you.

Operator

comes from Kashy Energy. next Simmons with Our question Harrison

Kashy Harrison

should Thank could would on we everyone. and exit one, taking think I about XXXX you the discussed morning, Good provide for color was if rates need just all wondering rig you that before questions. for see oil my first that earlier? to you some production price My you how adding

Cary Baetz

right then But in think I guidance. jump we’re now now, Gary, – talk. let not right just you updating and I’ll I’ll

this out less to Things not point improve think we we work. But it’s we’re is Obviously, get we’re still I time. this in put what So are capital more – put capital put in guidance. April would updating where at time, X a market. to we point work. about still at where thinking we dynamic could could Things where worse

you of Gary, rest So on it. jump the let I’ll

Gary Grove

rig the the that drill add strip was your September. those the wells And question, returns, Kashy, have I’ll of just currently, current in to particular would one right ones on we now, plan at with that other part strong

again, we what a that rig at at look that would at projects. is conditions will to look online are in sentiment return our but bringing September, in point sooner we time. the no strong other sit strip, be right But and see drill the that to than there plan like those current So here now, looks as today

Trem Smith

to which is the point. more Trem. just little This strategic from a color add I is Can that,

today return. those are economics good terms of So of the wells in

situations. looking So what is and doing of really, to COVID we’re understand better the the oversupply trajectories

where turn okay? opportunity, can we in lever a once see actually that position an We’re we

Gary Grove

I Trem, good gear quickly. gear can down and should a up that’s we point, quickly is And mention that

very as quarter And have take far goes. many don’t first this times. activity we’ve as as action that that us long-term so We mentioned have level any And decisive to commitments, our we allowed flexibility. during

so But it gearing very deep. on that as drill if a you will. not wells, also us when don’t of time our again and up strategic and They back allows us that take some Remember, gearing well. advantages does give up long to down, inventory they’re do we gear to

Kashy Harrison

That’s of my And from great then color all you. next question.

Trem, you been might about think CapEx maintenance I per to earlier, $XX $XX BOE. it was saying have

about good fixed BOE or As QX biased maintenance should think forward think components XXXX? the into we to how you production use CapEx about moving there be Are higher looking base any is potentially a that to may that lowering be per that forward? assumption QX,

Trem Smith

to And Great. of per barrel. reasons what than variety you said point a that’s our in I we – was quarter because It’s efficiency we the that What first good clarify. for less an this our historically, per important of is $XX $XX is call capital barrel. spent $XX ask year, capital to maintenance

we the historical Gary pointed as numbers time, expect return to values. However, out, over those to

So color that our $XX to Gary, will in you add And $XX efficiency any barrel. do want to to capital a be that?

Gary Grove

Just a little bit.

maintain look higher basis math, expected As annual when range as to production purely year-over-year, be that to on over the production you the that end if capital production the employed on lower And to be us you’d from range. an end our at of that would year-over-year, helps. of us expect comes the down just kind period up that of on ramps you

said Trem think I it So well. really

that going more a expect unique today period what kind a us we and be we a you in to for of as consider development range to forward. scheme should but back get us in We’re typical pace,

Kashy Harrison

relative think the in may should detail I’m can we missed final how share And specific QX Brent? this during California prepared question. some on differentials remarks, then but my about to you more I have sorry,

Cary Baetz

seen We’ve contracts of relative again, our so most are Brent-based. to Brent, –

as But for minus Brent think some company. looking they’re as we’ve if about about differentials, average at exact. the differentials, I much be you last perceive now, of X.XX, as So total seen last week, I do. about, as squeezed a one think if wanted just we people we now, I Brent to ended about of right think, Right far you’re year, we five, minus get differential don’t what as

bit So assume we’ve seen but we out Kashy. any them whatsoever, seen out. we And we widen in out blow haven’t see will little way them widening a

they the and we that in the are see start months out over a reason important coming to the a back three they of model and June expectations in think July Our we’ll little kind just… in added widen bit and capacity storage we August. do our it’s widening it’s Though

Gary Grove

And Kashy, additional just bit a color. little of

It’s earlier. price, posting on ping, a at out important links have that Sunset either to that or contracts and up and Vista recent Midway, indirect Buena Brent, bit versus Brent, Midway two of the referencing you our to to a of and very were and direct you or track an posting look Sunset, If four between example. to XX% note that go as would see not the differential directly little expansion

don’t currently structured. Cary Sunset, as So Brent you and good marker you versus unnerved to out use from us mark bit how us little get mentioned, he Because as that’s Midway our us protect to that example. to go I contracts to shelters quoted not and plot want but currently, numbers the a are were a in an if for

Trem Smith

market whatsoever a not And especially, for is us. ANF

Kashy Harrison

and Thank a Got very color day. you guys for helpful. it. the that’s helpful – good have

Trem Smith

All you. right. Thank

Operator

[Operator showing to would Instructions] call questions not this to time. back turn like further And any I over the at Trem. I’m

Trem Smith

give call Great. Thank not any for today. us you and to you ever for very hesitate much have questions, do This everyone concludes call. our thanks joining follow-up us and a Thanks. if

Operator

conclude gentlemen, and Ladies does presentation. this today’s

now wonderful day. disconnect may You a and have

Berry (BRY) 8 May 202020 Q1 Earnings call transcript