BRY - Earnings call transcript Q2 2022

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Operator

Good day and thank you for standing by. And welcome to the Berry Corporation's Q2 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. to Hunter, conference General like speaker to now Danielle today, Counsel. would hand over the your I

You may begin.

Danielle Hunter

teleconference. issued Thank you. quarter Berry's earnings for for results. joining today, Welcome to everyone. second Thanks quarter highlighting earnings release an you us Earlier second Berry XXXX

Chief Cary President. Speaking Araujo, Baetz, Officer Executive be Vice Chief CEO; will Executive and morning Smith, Board Financial Officer this and Vice Chair Trem Fernando Operating President; and and

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

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

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

will post turn today also on later our the link to I will We the XX-Q over Trem the call now and transcript of replay file our website. call Smith. this and

Trem Smith

the is expectations. solid results joining us of trending for in-line to morning. in XXXX a Berry thank flow be continues delivered quarter our and cash machine. We everyone you Welcome with the second year and this

uniquely quarter, delivered as on we return We variable have forward. our cycle. is Last dividend capital through the shareholders Berry to of top shareholder tier to we our a capital pace returns to well remain beyond positioned continue current new deliver track record our returning returning going strong first model.

we even are are to We delivering that dividend this quarter. larger report an excited

still quarter, and larger highest the return. dividends share, than fixed and of for the variable range as the of commodity capital We $X.XX than quarter's Xx of more This in prices. For dividend per positions one the be our XXXX to on per anticipate returners in share, us combined last industry. strip will the the year cash $X.XX plan current fiscal $X.XX based the is

discretionary board cash regular As opportunistically, we flow, of share remaining payment is in to cash including XX% return repurchases. The $XX used of is the cash our a discretionary million discretionary delivering million primarily calculated and in the $X.XX of then our $XX discretionary which our top also second or of share. on cash variable per $XXX utilizing the flow share million $X.XX the repurchased approved second per fixed million dividend portion in X $XX shares authorization quarter, of allocates in of the for capital dividends. the a the means XX% on generated for dividend form of shareholders In form we after of variable repurchase quarter, million, aggregate. model fixed we We of to based be are the shareholder reminder, which for dividend is flow generate, share that

XX of XX% so This to per the year. public than XXX more paid million than repurchased $X.XX includes the net proceeds. the than far returned and and announced inclusive Xx form in Since of of in more million more have the will shareholders repurchases, which we million share shares the XXXX Berry’s have dividends X.X dividend last that July in we is XXX million going IPO outstanding this years, August few almost will Over shares. share or be of

our see we year, discretionary the of remainder flow relatively strong. production the steady and cash our holding to remaining forward Looking

be in use plan optimizing In due this expect further. the of its capital Fernando will existing guidance a to wellbores, of lower-end development capital. on range, further to to our our at focus expand addition, full-year shift we on reusing

Fernando Araujo

Trem. you, Thank

earnings in For performance details QX, of please operational refer our XX-Q. to and release the

Here most of are QX. our We allocating remained from a divestment to Production of QX, wellbores over to is essentially achievements more few in efficiency key existing like flat capital. working in highlight I'd by to efficient January. QX Colorado use net which resources QX, our improved from our capital

So reservoir we a implementing enhanced and Also jobs program, QX, rate began have program. scope and management. XXX% a generated to effective over includes This of new maximize optimize program work base oil the greater is we robust helps us workover surveillance gathering year, from far with completed is in which for this has production recovery return another additional way placements. XXX than fields, The us enhance data wealth performance. helping our

OpEx MMBtu at BOE. realized of additional plan demand. less to what per of This expensive. have gas to quarter-on-quarter generates brings workover pace physical, oil XX% that by current as will previous from by production account expenses mainly Non-energy QX. we for increased operating QX most of the our historically by line of in gas XXXX gas expect hedged natural of demand our Rockies per supply decreased and our from beyond gas in the and to River hedged been have average, line, activity prices $X Kern work production in official this have done pressures. total capacity expense driven of to California have higher than we remainder demand Also, executed it that the hedges continue the inflationary our in We above We plan activity currently on $X.XX and QX. pipeline a production year. mainly reliable for additional, driven more quarter-on-quarter, up Also, today. covers base identified quarters. of We we This Energy at in XX% two-thirds total was

summarize, production according the of the markets. initiatives us to All To have to delivered year plan remains guidance production mitigate and help our these gas date we volatility in unchanged.

outstanding the significantly I of Cary. the to in it now and During which operating accelerated increased will pass California. activity, results both our delivered quarter-on-quarter workover and Utah at we margins quarter, pace our

Cary Baetz

Thank our We top achieved free commitment to flow strong you, further cash discretionary and yields and quarter delivering this demonstrated tier Fernando. returns. total

current second few rest item. Our next to payout well and One met as based the well-positioned quarter XXXX. variable over upon our we expectations for as housekeeping are dividend have the strong the strip. years of

record highlighted have fixed the and of going and dividends payable our earnings aligned We in as release. the dates forward dates variable

at rest of this of barrel This Brent pricing the roughly have free we production a about provides hedging, for a anticipate Regarding and XX% more hedging oil our $XX prices around significant flow the our year. and continued upside detail certainty for leaves swapped planned rest we over portion our of the our year throughout investor the near-term. on Please presentations production of of XX strong the program. Slide for look as at cash

Our guidance ranges remain place. in

on of operating the in higher increase side However, the due workovers tracking to expenses expense. guidance are

We to incur some additional costs with optimize also existing program production. will associated wells base surveillance our our improved for

for the additional Trem. well increase due primarily into overall and to lower bores you, value well the closing, We provide count significant deliver predictability lower cash year. due cash to strong in to and existing reusing the deliver shareholders. continue anticipated expenditures, In that, visibility we With with capital for expect and the have new to to returns we Back flows. confidence and plan to our investors to slightly

Trem Smith

team Thank continues successfully returns best-in-class on strong our you. plan. cash Berry’s to executing promises, strong generating its and deliver distributing flow,

briefly highlight to like I'd questions, your note. three take we Before items of more

won team the award presented in we record, C&J Council's to Well summer at Energy Technology Group won First, and over Gold report will be the extremely meeting. are our Services has Council's proud for XXXX the safety C&J XX the Workforce years. V last tomorrow this XXx that Award which

signed Second, Notably, our we sequestration capture in COX of projects our major with on footprint. current These up of XX% and to operators in stages planning. emissions have definition carbon California. reducing and operational are early carbon of capture to intent of letters long-term projects continue direct the focus to we

our Diatomite some news production. have we regarding exciting Finally, thermal

We and development takes using Sunset early initial horizontal of target two Diatomite that our The reservoir Thermal testing advantage encouraging new In of existing have field, new reservoir wells Midway North energy. results a lot concept from of a wells. in leverage for from success wells thermal heat the need up Berry. existing continuous potential opportunity represents with the not do new opens operations and therefore steam short, exciting This application injection. important an steam

up I'll for Now, open it questions.

Operator

Ferro Company. Michael you. Instructions] And Rice & question our from from first thank Johnson And comes [Operator

line now Your is open.

Michael Ferro

Hi, good morning.

Trem Smith

morning, Michael. Good

Michael Ferro

use – on Thanks down if I you to it for like inject question there. questions. steam, appreciate good Thermal advantage a the my to but current needed to still it the that's my that's the that's regarding first going energy taking color be seems already was Diatomite,

is on production that's to determine that it impact program, early too or number to? of applicable going this So, locations could in be the regards new to an to this development have how

Trem Smith

Fernando Trem is I'll to This necessary. if follow and too It is let overall production. early

opportunities our continued acreage. in terms locations opens well of up this Diatomite hundreds for us with However, success throughout of

Fernando Araujo

Yes.

We heat first two wells. have moving very We're that to wells fluids. encouraging results the from we've the producing getting oil. We're drilled. We're

system lots gathering fracture data. wells We of connecting to have that's heat we're and the a the

that we're we So, of phase continue it's in next to the is and with have. that the program very right opportunity middle opportunity now. that phase of And preparing next exciting development the

So, it's very exciting.

Michael Ferro

helpful. That's you. Thank

regards is, question how does couple might challenges the look thermal what than environments path developing going a wells or for like just next my does wells these other in more forward it guess current I look test actually to So, regulatory that or like face? you diamide the to of

Trem Smith

make safely in entire And the steam cyclic approved more drill a finalizing doing the to available process. where CEQA to not and Very new this does this by EIR which capabilities, one increase desire will Does is is words, be us terms its not that us excluding area, activities simply into give just planning. It build are something even area to away the see already We is This in Kern Michael? it's moratorium sense, this headed high at locations note the these the steam opportunity additional opportunities County In would regulatory looked And good item our efficiently and take parallel the covered other. of Michael, which from of while that's the will world. in we're is reentry fact other light successful. here, lifted, to that we injection pressure question. more. in

Michael Ferro

does I the make information. actually. appreciate That sense

Trem Smith

us. very for a thing That's good

Michael Ferro

and like these forward. the going looking about to hearing prospects Sounds I'm Thermal Diatomite more forward development of

Trem Smith

are So we.

Operator

one next And question moment Instructions] comes for moment. questions. Steven Everglades. from Busch [Operator One you. from And Thank our

line now Your is open.

Steven Busch

taking for you Thank call. gentlemen. morning, my Good

So, update in California? could situation on you the permit just an give us

Trem Smith

position that are in permit the will final Basin, is well with Kern The of us Sure. allow move put opportunities court we throughout adequate system EIR hopefully and update, in re-entry the County to particular. drilling Kern – in its County Central stages new being approve forward in the the

on. In tracks, And with into re-entries so, need all the have meantime, workover existing because that's and know we permits wells bores. we get we side are going of abandoning plugging over and well that workovers, And today. X,XXX any currently these we the opportunities –

of locations So, use And North trends, Sunset great drill that Potter that's Thermal has I just very get a area Midway in large we're there's already well able new positive as coverage as Diatomite. which as our outcome CEQA our approved then a sandstone and includes that's responded a because there, to capital.

Steven Busch

Okay.

you'll if say, this you much…? up, potential have So, the or permit pretty year a process loosens you're would upside

Trem Smith

in activity. but XXXX and extend new yes, that beyond. sometimes the Remember, would from have actual while to they it takes would into Yes, We for a sir. terms be little up ramp early drilling wells, of upside production upside

Steven Busch

process, develop Okay. that? this a technology is like you patentable or Thermal else? on develop something or Is guys And with someone Diatomite anything this it you

Trem Smith

is something internally. We that this developed have done was a –

which there been at a one reservoir, it increased there and characterization out surveillance to stored program these result reservoir should allows of of it's the of migratory some path is turns reservoir, Looking and in flow. the wells and have the inside energy the terms an was outcomes

and So, just geologic it work led that good technique. no, reservoir this was to

Steven Busch

Okay. go. I appreciate Alright. good far and Well, you. it the we dividend looks looks like steady as so Thank and we’re

Trem Smith

That's great.

could be Thank you that questions. say that you. the louder, If would Enjoyed great.

Operator

from next question our Company. moment one Michael our is And And you. Ferro a & question. from Thank next follow-up Johnson Rice for

is line now Your open.

Michael Ferro

full-year assumption the $X.XX guys. quick $X.XX I'd in range a cash Can thought per regarding Thanks, used you I that expectation of share. just have is what being clarify follow-up range? oil dividend to price

Fernando Araujo

the position look Yes. hedge our at based upon We current still it strip.

Michael Ferro

That's you. great. helpful. Thank Okay,

Fernando Araujo

Michael. Thanks,

Operator

no showing remarks. back for call closing to Trem I'm questions. thank to would the And And further you. turn I now Smith like over

Trem Smith

the taking quarter everybody a of want and thank and Thanks to I variable hope I great the for time. appreciates have Berry a the impact everybody was good dividend. significant It day. for

Operator

conference today's for call. participating. concludes This you Thank

You disconnect. may now

Berry (BRY) 3 Aug 222022 Q2 Earnings call transcript