BRY - Earnings call transcript Q2 2021

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

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Berry Corporation Second Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] Please be advised that today’s conference call is being recorded. [Operator Instructions] I will now turn the conference over to your speaker today, Todd Crabtree, Manager of Investor Relations. Please go ahead, sir.

Todd Crabtree

welcome and [Kristel] you, to everyone. Thank for earnings teleconference. you joining us XXXX quarter second Berry's for Thank Yesterday issued afternoon quarter second Berry an earnings highlighting release results.

Fernando and discuss Baetz, Chief will Chairman Officer and and morning Trem President. Financial Vice Araujo, Trem Vice CEO; will Executive Cary this further performance, financial Officer second addressing and then Chief and Speaking President; Fernando as of remainder XXXX. are business. our well Executive quarter of Operating we will aspects as details our be and share the the how our operational expectations Smith, for on Cary

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

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

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

refer law. the reconciliation mentioned our plans measures no the on GAAP between call Please by have or in We to today's and adjusted required our them, duty in all update a release measures. as tables to for website and related earnings except

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

Trem Smith

our our and financial for plan with Good Todd. and to solid everyone, and long-term value execute to we remain our excellence. Berry The you, disciplined annual principles Thank our to shareholders. team committed quarter and with Berry continues consistent to expectations a guidance, joining us had XXXX-XXXX thanks today. delivering morning,

despite We our standards. prices continue reduce without compromising to non-energy basis safety environmental on our a increasing commodity sustainable costs and

safety flat Our second in essentially our exceptional. and quarter, to year-on-year plan. production we production our grew are record per the on keep approximately remains target X% Furthermore,

simple, At a tenant, resilient, with for market live and four we cash Berry, flow in promise we Our all, flow. free we we free remains financial have levered free past and the it the This have extreme business cash free today to durable, our for the generates model key is generate future. proven continue and but just not have doing. in-line cash and flow Further, already been of what and most cash environments. It's generate in years. flow out

do. We are not another aware that like U.S.-based defines it company we of

include like expenses considered dividends what call CapEx the normal Only and cash flow and flow. is G&A, In Berry maintenance expenses addition levered free cash we flat or to be the or needed to interest, cash we taxes, discretionary after free to OpEx, these generated keep by capital. production

to going pandemic grow put our forward should the as in free levered Our only place roll cash during begin flow hedges off.

for is U.S. year vehicle the miles of to travel around per supply is pre-pandemic approximately to oil declined the The pass price almost in in oil day. XX.X overall million the has of seeing returning has the and normal. The in stable is we U.S. XX% levels air barrels at moment and the in for As industry. from $XX back of oil levels pre-COVID from oil U.S. increasing as we positive is bounced the year, signs mid-point a up The are traveled ago. the demand

and in Utah. of to position continues DUCs, impacted capital is in as create any both of year. meet the meaningful in California on grow and the new Utah and or in not However, levels want at in we second below wells pandemic as Berry, the to inventory low-risk of XX very wells in once in produce XX.X% demand uncompleted have are clear less resource the or wells significant drill DUCs continue are fall. through we most we We QX. not coming are many Furthermore, last active our bit value likely in and collapsed again by that depleted, been are demand California terrific constraints the but California. are and Remember, pre-pandemic resource to drilling quarter, and spending reservoirs conventional well a X overseas is remain Therefore, the shallow, which rigs however, with growing drilled be companies is supply making inventory where Utah. from or drilled continues of wells I the reservoirs three low the especially operator. to U.S. rig we X to California market regulatory repeatable. its the in counts after operator XX% a wells governmental predictable production in completing of to In new in currently U.S. way in left and the conventional programs drilling and decline, XX their

top-tier Board mid-cap is to XXXX increase our the XX% and have share, lived to this, measures, always continuing beyond. space. $X.XX despite we a in our have receive the to drill. strong We By political are third In and grown flow, our on permits quarter free dividend to words, Reflecting E&P and or all we track distractions increased maintained approved to production, small cash a within a and value. shareholder levered Berry are headlines, other return per continuing

visibility clear, we we production current quo outlook flow look Berry potentially to us capital return the continue however, is incrementally dividend best as to to needs our the increase of Strategic be through continue us increase acquisitions enabling as keep gives is team priority capital value-adding meet cash accretive, and status model use Berry generation. to increase through shareholder our a strong. for our to the Our believe be flat scale cash We for returns. free M&A. To very to the

to create continue the and will based current our for shareholders strength. continue on We value to, significant

governance provide understand all ESG come. way, social, While our and inventory is encouraged beneficial growing value all our of we are reservoirs than which or of and to am our to stakeholders matters environmental, interest alone that energy and the more sandstone by down in M&A opportunities, not slowing XX for stakeholders help I California's decades years we that evaluating We demand, and the investors. to looking for long-term have will meet the importance of

our it website, area, which well quarterly as disclosures. you our this Yesterday, continuing sustainability to on we have since published like we enhance work with find as page are public, our our we disclosures the our became bry.com. work can it Notably, all, to our metrics to perform. SASB in All the of introduced for We continues has industry. update business just report, aligned continues in model

generate our so into positioned to we now to to the over are for continue future. and well do shareholders, Fernando. We value will turn I it

Fernando Araujo

safety, we to of environment, protection top you, At reaffirming begin same remain value continue performance comments time, to regulatory the the and I by my optimizing Thank priorities. create by compliance that of and the results responsible safety, continue Trem. want report manner. to QX. in environmental health, that generating conventional I'm meaningful and assets our we current safe growth our proud excellent achieve and plays many a to of in by in

without we fact, the In mark XXX-days without approaching incidents recordable are incidents. XXX-day and time lost

the our to of quality will protect employees the of ensure dedicate environment, to and the commitments the regulatory infrastructure. safety necessary continue and our to We to contractors, resources meet all to maintain

to production Moving in QX operational is day. than averaged XX,XXX This higher barrels QX. X% performance, a

was production, XX% California constitutes our Our quarter-on-quarter. flat total which oil production of essentially

our on production is resulting producing completion are which year of XX% returns. now delineation production almost asset eight drilled to successful In be the currently and three high. be XX% in of in better formation will with than QX. the operated drilling and attractive wells, production We wells want total Hill of which are expect drilling part XX drilled sandstone very In where is The our in and and in Potter last sands In Utah's oil. below in total, reservoirs. Utah, Monarch QX, injectors rigs production highlight are wells, completed Basin, XX all XX% and targeting included our we Belridge thermal XXXX, field. which a we exceeding curve. type wells actual results type the put to I in property, year California, we XXXX, at drilling on curves in two drilling seven of giant Uinta programs performing vertical six costs Midway-Sunset the Tulare in predictable XX the have eight for especially in field. QX, and by For drilled we These wells

activity. activities campaign to remainder workover wells XXX% the XXX This will brought Basin aggressive Utah back bank to have of provides realized year-to-date. of another to approximately capital that our substantial The for conventional in with These We in flexibility healthy Uinta predictable from attractive our excess yielding a excellent drill are provides we in workover rate assets. Furthermore, return of aggressive a of production results opportunity permits continue XX program. XXXX.

in rate As year. previously a slight stated, the compared see we the last year to half to second production growth exit higher expect a QX of with

opportunities July, in third QX. As picked up drilling targeting planned, a in California, we in additional rig

our in offset Creek unexpected meeting decline. the steam We where volumes Poso situation an field's by an along triggered operating production in have we lower to and injection field a production under production. The operator is despite high arrange our control production practices begun already with reduction in are targets drop

Next, operating expense a There $XX.XX per year compared averaged boe. from XXXX. boe per last of improvement $X.XX boe expenses. and to an when we improvement let's In operating turn $X per is to QX,

in to than than our Moreover, about able lower since are non-energy is boe been of OpEx all per to more cost $XX.XX sustainable we cut stemming improved XXXX. flat efficiencies per averaged boe non-energy parts of Our $X out compared operational boe. QX our These savings have $X This per in XXXX, from structure. QX operation. and

lower in to average. Our still was QX last compared but X% energy to OpEx compared year's higher when QX,

remember, you offset plants energy OpEx which California. includes As are may mostly sales hedged purchases, gas our in electrical our from fuel cogeneration by

the in first as million turn This $XX.X of was within year. for to QX budget and our the higher half capital. let's CapEx than QX planned. Now was

we quarter, the added drilling addition the two-rig to in in program Utah in California. rig During a

compared an activity also in of We QX. saw QX workover acceleration when to

for XXXX capital remains full-year unchanged. outlook Our

are permits of capital receiving in permitting enough we XXXX permits drilling program XXXX we're applications have of and achieving for XXX in To have safety hand have XXXX terms California, remainder our execute well XXXX. submitted our time, and approved XXXX At to We permits actively of program. In in summarize, we the same and the results. in our currently part for California outstanding for XXXX. program

Our grown the the since of production sequentially has beginning year.

plan within are focusing taken expenditures of We we since OpEx a our revenue-generating per in with on projects, our structure sustainable way. XXXX boe and capital out $X have

We Cary. I'll the achieving the goal And basins turn over with it are to operate. we our best operator become in to where that,

Cary Baetz

quarter with The was sales gas for – more prices and Fernando. line return prices. Thanks, in natural as expectation our seasonal oil to

gas first the remember, you as to quarter of Storm million Rockies XXXX the EBITDA. $XX nearly sales were in due adding of high to As Winter XXXX were our in impact quarter of as they all may adjusted Uri, first our

very as operating you market remain of cost. focused million, can a $XX gas second have adjusted our significant on which quarter that first it was EBITDA in impact our quarter mind as to natural on in-line expectations. keep with So We compare

are October year. next continue will and through gas additional to We added for hedges hedged have natural and the well add

from to the natural This to gradually are pipeline, a to us gaining allow need or California, [all in our will to operations effectively Kern hedge. in physical reduced the our years] gas Rockies move purchase we access this gas other fall. because be ours hedge River However, beginning consumption creating will gas the

same in mmbtu us XX,XXX potential global place been Based for gas to We for another increased is the in activity, mmbtu This May opportunity to down to California. great access at since our the as continue on for supply up day this contracts year, These but to years. level to disruption better high of up have is XXXX, of a XX per a XXXX. improve. evident. to day starting Global slope Oil manage of has XX,XXX per needs granted are demand in gain drilling a with in not gone fundamentals supply XXXX. major is oil almost October

In producers on fact, the to focused U.S. DUCs. seem be

mean back to drill However, isn't CapEx to higher for work, bit most flows. this will to This the be – the which will for Berry. eventually case put will they eventually cash and need need put lower

maintain out to flow. to we and drilling live production, levered of continue cash are free We

structure we based debt maintaining forget and In cash current cost produce definition our strip about cost prices, free levered upon our Berry our interest enough could of years. that cash Don't fact, be of in our levered today's X.X flow the paying flow dividends. production, our and free should includes free

I on point are a this machine. a to We cash hone flow little more. in want

has focused both the negatively which the to has or improving One compromising XXX% such our we All concerns at $XXX for the today, us that amounting it on Berry of market and this proceeds to explanation we of regulatory production of capital politics environment, the why a returned $XX done to discount dividends, California publicly and while understand are As and is hard trade million, of about intensity. and industry. oil makes have including IPO that industry. without million possible its

of remains do day additional production have back if to to starting with small in was and However, ago, barrels operationally federal The We the depressed. plan. state per see had been could the an quarter, have the of in QX. end the majority production headlines a Berry not in XXX we impacted the per plan, experienced improvements the would valuations in of spent we have production the the is majority in in to legislation. attention-grabbing line second and we our kneejerk expect return later XXXX. uplift spend. creating expect quarter early years new be second Fernando see And or capital our We our year kept earlier. markets this production we from quarters. spending our Capital from fact short, expenditures since to four production that just negative issue seeing mentioned the third fully are Only for or capital reactions In not the the weighted we that are timing our

a closing, said, do a that to so we strip, of that on levered out over working point needs. the changes foreseeable are we our are we with currently group see cash for the current no are In we to at a not right-sized base limited the our We working facility the demands. don't need making current annual bank have to a borrowed That our provide is live in in the year. strong liquidity under facility future. And new market Further guidance. exemplifying free borrowing we flow,

XX% Lastly, per we're $X.XX we capital, continue to our increase focus to on return of in dividend and happy to share. announce a quarterly

Our XX-Q filed today financials. the you if a later want to take into will dive be deeper

turn for Trem I'll to his it final back Now, remarks.

Trem Smith

summary, with Cary, results. and quarter was you, good Fernando. solid a Thank In it

us great As I underscoring and you heard, close company, we want makes what a to by great. are

about XX% We reservoirs. have averaging low-decline, predictable, annually, shallow, oil conventional

Our durable has political is business collapses again model It market continues to withstand pandemics, It and resilient, to headwinds. that it works. and perform. shown over-and-over able

Even to flow as our items, free If levered cash defining machine do, maintain cash like includes $XX which above generate else CapEx no above cash seems have to flows with flat, we and cash interest one definition, discretionary we Brent. exclude dividends a we the those are our everyone Brent. We $XX free flow production else does.

We continue to value return to shareholders.

just of three We X. public day $XX going total this shareholder done years million More in out returns since since in million dividends $XXX have than ago.

strong natural hundreds production contributions definition, we in XX% a cost operate. OpEx of local Remember, basis, production. We than and a on where higher and mix same with time increasing reduction oil. to substantial at mix management jobs cost gas oil is gas provide economies more skilled have high-paying sustainable We the by a the make our oil than while $X to

finally, environmental an We in and California's record Saudi have our for all And countries, strictest the over environmental These keeping it energy standards to to and its and labor, now all safety and incredible of standards. adhere employees, most rights, of and and I'll healthy. while and the Ecuador and imports safety, Iraq communities sharp our contrast questions. including where safe Californians, human our in the environment, the are turn foreign Arabia, California providing equitable oil. world are for we affordable contractors,

Operator

from [Operator Mariani the Leo line Instructions] Your with first question KeyBanc. of comes

Fernando Araujo

Good morning, Leo.

Leo Mariani

can Hi regulatory on to more I any bit guys. hoping kind will the maybe I little thoughts talk in folks you're, how maybe fall? the respect about maybe election, of wait progress think what – guess situation, the you see know so about a particularly into I a – the what what color get to to on of to you perhaps kind recall here you that was this on seeing your month having just about happens of with out study. Livermore kind be just there? Lawrence and plays talked with

Trem Smith

requirements, able they're of And CalGEM Sure, everyone high-pressure first a Again, moratorium to by what all, the of not Leo. going we production. is another to meet do. the the some wells, are Trem. seven new This California only stop was which on us on regulatory caused to mechanism do tells operator particular failing that cyclic operators existing other call, doing reminder to then steam to caused

this production is, able or our We those plans in areas the year. budget to next wells as and for we no been the – existing current have of none maintain have year in or

will So, And how that's political But tied how add, the I'd discussion is state on long the think and to – the call. the also that the big up out the when is have frees didn't I see that see election, CalGEM wait to emphasize plays see outcome then it state. a To to of certainly And we nothing to and the report. recall in setting. there the of we piece question, out. plays continues up like it's Leo's environment political to it earnings aware, in wait to just up. have was that remains regulatory to regulatory wins in this Leo, been reason And done. They the to remain and tied

been time. by legislative haven't sessions the influenced this We

WSPA them and requirement We have down to there's oil ourselves, is go and recognition coalition. there's a with green the and And that a this more in very relationship transition for good growing a gas state strong a environment. to a

And about to talk no reason was so there it.

Cary Baetz

does stimulation well was And Yes. came only – through other thing stimulation was the that impact about well and Berry. California not

Trem Smith

correct. That's

Cary Baetz

Period.

Leo Mariani

Okay. know at this news, that front the Well, in folks point news you for on I is you no good guess, near-term.

Trem Smith

let Well, It's near that's on not the term. make managed be make okay. to been continues to also just it's we – a we've Leo, sure that me follow-up. is mitigated, that trying just It's by us just were The any never so and had topic and want point clear. That's it. to one impact

Leo Mariani

certainly Okay. you how And here. in folks M&A to looking obviously, your prepared talked certainly something do is you're about that comments,

seen Just guys a in sense feels last some maybe and the the a year. update? higher they little wanted the were a several did environment high-level start you feel bit of it at be earlier year. months that to have price there's get than stable We in the much closer obviously there's Do if like might a oil bit any than more opportunities

more guys on to think as do you whether us front? maybe not So, maybe and just a that sense you of deals are the how give road curious down far or just there's

Cary Baetz

forefront you our capital – active. got what an at status it's Berry. is, especially of and talking And I think a our spend right this quo to looking time Again, know, it's consistent at Berry that's at a extremely matter. we're very a of about on The is it's for something the current attractive basis. trading, – extremely Trem on Leo, transaction the is reality be I The strip. we're lot high. as of extremely cost now, attractive for it's

hold today. but we than lower much of to they we the XXXX their resource continue return when One productions which just yet evaluation, valued flat. most $XX in continue plays, be $XX.X have But you capital, from talk dropped continue things execute, continue million our to frustrating get we about And capital, that million now we look at to we rewarded. returning production have to to

with Cost got looking for those we So, take that for works it, is to grow. but parameters. something status attractive. capital of Current we along our that advantage of meet being expensive. us If and quo will it's current extremely opportunities comes to is are shareholders, said,

Leo Mariani

dividend we in right obviously, huge Okay. kind you That I with sense. And could action increases you roll take the increase to though hedges future. healthy respect with guys call, dividend this flow clearly, jump of And as you in guys there's other if makes did those some it cash that some as have a sounds certainly on and underwater some year. in very a see the off, And XXXX. heard

equity So, to in deciding maybe committed you're more like maybe of a appropriate you time. guys absence I quite guess give it to dividend the valuation, over markets a sounds bit ramping this

Cary Baetz

say statement. I fair a and that is accurate would

Leo Mariani

in Okay. about more the year. the of Great. you money And part guys spending lastly, certainly, maybe middle just capital, on talked

that for should QX? it to similar CapEx, that? with just QX before drops you pretty in help us Can So, off QX be

Cary Baetz

say, Yes. I yes, would Leo.

did the curve earlier majority where second fourth. especially as would more the quarter Our fourth say of much bell ramps I a that's, in a as people and third lot. And in we're first and probably – and kind spend traditional lesser most and CapEx it poor spending like this year, job what of we messaging looks a down the it well amounts

So, third I a lot should look would say second, quarter like.

Leo Mariani

Thank Cary. you,

Fernando Araujo

that. little add to Leo, just Yes. a to more color

As we've mid-July, And in with two drilling a operating in up then picked we third rig. drilling you rigs been know, California.

to back QX. rigs So, with in we'll operating we'll for California be and three then rigs two drop QX, in

Leo Mariani

Thanks Fernando. Okay.

Trem Smith

Leo? Leo. Hey,

Leo Mariani

Yes.

Trem Smith

when back a go for Trem. first I can second? to asked, I question your is forgot you This

Leo Mariani

Sure.

Trem Smith

need the permits permits and for mentioned to to call, system is, our We're on that XXXX, in we way XXXX, got our on the having part have the we've even it okay. are we of well for in well other we've XXXX. way everything is and in The having we – this well,

that's as sure just want make I to So, well. clear

Leo Mariani

Okay. That's caller. Trem. great additional Thanks

Trem Smith

You bet.

Cary Baetz

Thanks Leo.

Operator

of comes question the Rice. Charles line with Johnson next Meade Your from

Fernando Araujo

Good Charles morning

Charles Meade

I Good sure this there's detail wondered morning all of you what across if with you little But this about this. was a your differently, what operator? And happened Trem lot this is Todd last night bit exist for appropriate way? give similar operator detail to in other put offset a with comments. I'm could portfolio able probably speak many and Fernando Fernando, your that for a I and little on affect bit Cary. curious how more your Thank another is places really I'm offset in not or how circumstances many but form, asset base could on you

Fernando Araujo

Yes, Charles.

two-fold Let And that reservoirs, a on problem more then the and a up related same the that. decrease withdrawals, down operator. in reduction we as in The was injection we little really steam time, our you me at water detail in to dip. rates was dip a had offset give had

lowering encroach and or reservoir early to causing our breakthrough allowed So, aquifer temperatures. reservoir the this

production they've As taken measures. we've already engineers, positive and reservoir, seeing already mentioned already, We're from thanks the our arrested the corrective response we've to decline. talented a

don't similar a we with Creek, similar do similar And again, not places any any other was with have other Now, as Poso situation have and a we in this. this really – situation. fields

Cary Baetz

field roughly nice average it's on in – a about Charles, a but thousand day barrels Yes. field, a small probably over a is Poso time.

is the capital seeing I the it not of new production. concerned, this at but point I pointing this on efficiency time is market of was visibility a out in the again, So, to think because kind our one-off, point is,

we as of but right of it with put and Fernando out like the this usually it's market the takes pointed don't we I back to So, again, are point back work And out when fully, visibility, things capital so steam. that, And does think time. like out, in the understand good comes the it to bonds when starting move transparency we with to some this, but to predictability it. you get is direction, give dealing

with full be to that. want just we and transparent So,

Charles Meade

can that there's for lot you lot Thank understand I Cary, – operations directions. it. thermal a in go both there's Got and of always in that these momentum a

you to that got? about or assets, targets above can mentioned of the comments what refresh your are Going Utah the and in Uinta the but you that you – What you back kind what wells looking your that online you on kind another to of question there you curve, for? – prepared Basin type your us were have results ask results brought the on

Fernando Araujo

does We looking a wells prices. in provide part be Charles. will California, well. And again, very flexibility QX. a had and current speaking, especially Utah, of and prices, flexibility that's especially current conventional and QX in very the three than we've production. that currently our three-digit attractive, we'll reservoir, from XXXX and sorry, another have on have development development Yes, is in excellent do on wells at want our better like production our wells plan it it – IPs Utah And Generally seven that of Utah I'm IP in Again, I to our as predictable in that emphasize IPs, wells the those in at at we're program results. we're getting are

Charles Meade

Thank line. the the great. I’ll Thank but another Okay, two more you. else take hop and queue I’ve somebody got back in questions, you. let

Fernando Araujo

Charles. Thanks

Operator

[Operator Instructions] line Your question Pope the of next Seaport comes from Nicholas with Research.

Nicholas Pope

morning Good guys.

Cary Baetz

Good morning Nick.

Nicholas Pope

are I that I you know when guess, are with the the off, I outstanding at XXXX look flow of million, sheet you $XXX because looking flow to could at look how instrument have hedges going in of existing with that guess relative [callability] with this debt that sheet to, strong you coming balance place, is cash the how balance that right only sheet look – you of what rolling balance And that profile and company's it's you how hoping looking I those we of the have forward? note about looking thinking that? kind you you piece at want at the now? features talk, are kind profile cash How was you the mean, like

Cary Baetz

think I easier it's right These leverage would works. say businesses the without Nick, manage obviously. fluid, are I But right. to Yes. type of leverage,

works plenty high of think yield, the I for of fairly low-cost covenant very piece of well because again, that flexibility capital, on us note side.

– not it So, doesn't it's restrictive.

for [indiscernible], cash at to the it how get do trying is to you still does what premiums that normally a of overall of point is return bang we us it, free out our a our time lower XXXX. have don't that back the time Is shareholders? period in more idea where on about so capital to look make-whole at where when out greatest think We're call what biggest flow, think we is the time. that's you I I this shareholders I so for do debt? Is have that we're think solve I to it really the buck. the would huge the figure value we for maturity have. on of The get

have be this do be think we cash of use to in that's at So, fair. time, to to some point able conversation, flexibility fluid if back. But pull of best that the still a I it's

Nicholas Pope

– the And revolver out number it is credit right, $XXX still your the I – of million is – mean, to think it's it. [indiscernible]? is relative facility, look commitment Got billion at is you that total I the guess when X.X but I

Cary Baetz

Yes.

– paying XX on $XXX based there's as of that's unused skinny now, right use a again, because commitment the keep elected anymore. we $XXX on was no commitment. points million to basis million possible And a really think an I as be elected

a million view. rating profile of $XXX with kind the the works think liquidity point is of from agencies well I

the have Obviously, at free at if is of keeps needed that a this pipe commitments. this at point cash or there the of more quickly. of kind transaction into, not time. formula down quite who where need kind we're time, bit cash lives It's So looking substantially at than tap but the But in money in needed, to is on that that's how a that's again, of could – from something's point a it. out can bank in we looking levered we're a comes elective company flow, we something how move

Nicholas Pope

kind is of the Utah. quick it locked the on Utah, just waxy these been the just there, into it since it. Thank what's a that and wells, on Utah dynamic that's, the while right And oil? if real markets that you. Got still so, on oil It's pricing – is – focus

Cary Baetz

primarily Yes. market. I primarily It in stays Utah we is black it say wax. are would the – only

up year of that we're And to on roughly WTI. XX% XX% of about are to point We now, a WTI, have supply of right contracts view. XX%

pricing. has contracts putting reduced at that, and return. local it from want cost. part So a producers. like reason feedstock, is to refiners who Berry producers attractive market’s three more But seen market because and somebody actually with, that oil oil they to us Much in to point their work is for at WTI local like continue for need transport work they've overall to what we're keep of view, is those of production kept clamoring And that current an supply consistently get obviously, consistent it's market in better all that it's and California, And is from worked to decrease. that's the a also we've and longer-term profile looked of market, the allowed as attractive an best that

Fernando Araujo

in Lake that talking there black refining capacity City, Salt was especially for wax with Yes, about. our is the crude Cary

Nicholas Pope

it. Got

of of that was, a uptick So, like kind – there in was activity it it was driving signal demand that that's into there pulled this is sounds kind that.

Cary Baetz

that for. us. that an supply it's it is they're demand I And looking mean, and for. demand looking they're attractive market I still is it's for think There

We are are. what we

cap but have shape those good in we make demand on for sure opportunities in market to we're of We Berry. organics growth supply level there, eventually, some and keeping organic have that

Nicholas Pope

I That's Fantastic. it. Thanks have. guys. Got all

Cary Baetz

Thanks. it. Appreciate

Operator

a follow-up Charles with have Rice. from do question Meade Johnson You

Charles Meade

a kind the going I maybe an operations this water, for California to Thanks far field, back guys of to water hydro generation. reservoir and maybe had in. – that back of question you less but me there's this there's for lot low, that like is letting upside in news

there guys run the you exposure – about that there's about have there's you is guys cogen on sees could your it Berry? to California that so along something would – so would that, then – or is that there the And your steam horizon? and material it being actually be is be you electricity maybe your a access market beneficiary And that But any all be up, to any a and guys and And with with water cogen exposure facilities. that prices to is that's have talk – on facilities?

Trem Smith

you start Why don't Fernando?

Fernando Araujo

got In of that itself, produce terms we in we needs we've steam. terms water of our that satisfy enough and to be operation we treat and have that able the to

rest production and total disposal In water then water the is have sent it's we in fact, and to well, then a for also used dispose our flood and the water we parties generate as to use third we ourselves. XX% that steam, about of

don't for – so short, additional that's we in our So any need operations. water

Charles Meade

potential Got is it. is sales something of more – turn for not that higher for or that's dial actually it you the question really should Maybe Cary. attuned could electricity be to And we the for something a but for then Berry?

Cary Baetz

Yes.

this be higher, season right can electricity looking at Charles, could we're I demand think on sales. now for I us is mean, think, high higher. obviously, And be – prices the I more

seen of we We brownouts year. haven't the blackouts that and last saw amount rolling

seen an gas in have prices. We natural increase

If else, should they're California point in think you time. you at everywhere high this see

that at would that reason we it. whatever That year. the what's of for think amount point time, haven't trigger be this had the drive seen, to brownouts in we last going I

risk. for seasonal think for it's downside So, probably I'd I that. potential how not answer I'd trying potential now, – and right say a we're a with be to going upside more That's

Charles Meade

looking was was I a Cary. That for. you, Thank characterization

Cary Baetz

appreciate Alright. Thanks it. Charles. I

Operator

today’s concludes Corporation’s quarter Berry second This call. you. Thank earnings

You may now disconnect.

Berry (BRY) 8 Aug 212021 Q2 Earnings call transcript