RVRA - Earnings call transcript Q3 2019

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Paula Melancon

Good morning, and welcome to Riviera Resources' Third Quarter 2019 Earnings Conference Call. Today's call is being recorded. This is Paula Melancon, Director of Investor Relations, and in a moment I will introduce David Rottino, our President and Chief Executive Officer, but first I need to provide you with disclosure regarding forward-looking statements that will be made during this call.

The statements describing our beliefs, goals, plans, strategies, expectations, projections, forecasts, and assumptions are forward-looking statements. Please note that the Company's actual results may differ from those anticipated by such forward-looking statements for a variety of reasons, many of which are beyond our control.

Company's factors in our the XXXX the Exchange press including risk results prospects, Securities which concerning the releases. other Commission, available for public file are Company's the and we information plan relating September later business, to and and quarter to Additional ended XX-Q today, XX, any Form filings and with filings

release adjusted for the we calculation our discuss EBITDAX as and extent such see reconciliations. adjusted to measures Additionally, earnings these measures press the of GAAP and please EBITDA, non-GAAP the

website can www.RivieraResourcesInc.com information be Additional found on the Riviera Resources' section. at Investor in

turn I now President and to the will David Rottino, Riviera's call over CEO.

David Rottino

Riviera's appreciate Paula, taking for to time third good results. today of us quarter everyone. Thanks XXXX and We you join review morning the

and our Greg President colleagues will today today Officer turn Frew, Chief Joining to and Blue and and to results, On Blue Midstream Mountain financial Vice provide discuss the Riviera's and business, overview Executive Riviera's President call then results. Officer. Mountain my us call Executive over Financial are strategic Harper, Jim initiatives of third Midstream, quarter an our I and Chief of

deliver returned assets, assets, share returning have a offers. Since value drive commitment of market our we time, tender and approximately efficiently proceeds managing through in period million performance. August discipline through formation short our be extremely with to our of In and our happy have monetized to repurchases to to capital continue $XXX continues open remaining the investors Riviera capital on on shareholders. focused shareholder and to we XXXX,

very this of done a have all what market. in has energy We tough been

guidance and our met we have every or to exceeded adjusted production respect assets, quarter. upstream With EBITDAX

STACK with with two drilled North in NW results. of excess have We XXX%, encouraging and X expected IRRs wells Louisiana in wells

in gas side, have crude and processing added go business water our with On business. two gathering new of the midstream along successfully and to lines we oil

to assets the transaction we and forward about purchase inventory bring the developing Energy's of closes. recent announcement of commitment the excited to Roan them are Resources and will extensive after this increased believe We very with Citizen partnering look an

overall to returning pursuing the opportunistically capital We contract in goal agreement below our process that ways VPP, closed to our for asset Tudor, the value transactions, close in shareholders Basin, of with we the The sell in Michigan, finding Furthermore, we & generating with for fair the to strategic of $XXX the non-operated and value six non-core as stock XXXX. Louisiana. definitive the is work asset. Hugoton long These assets with shareholders in assets the a continue and or closed to of million Pickering, for transactions proceeds. transactions Basin trade our as remaining align assets still helium approximately Company on of interests alternatives we expected continues to Year-to-date maximize our receiving great asset will value. Arkoma price in in Illinois, net at believe quarter located million to to we have properties fourth sales are North this $XXX our sold certain strategy Hugoton Basin, include and a signed a Holt

is The In have Company of The up over million outstanding Company the share we shareholders capital share amount last million the the that to to to repurchase close from of million. XXXX. expected for of as authorization in to repurchased of of by XX.X in for have alone October repurchase $XX July. $XXX the Company's In shares back buying significant sale fourth Riviera's count million including return million, tender months our offer quarter than XXXX to shares, the XX, that approximately and XXXX available XX expects expects proceeds shares was continue also of $XXX XX%. a reducing repurchased more pending closed we our approximately Hugoton $XXX under over

performance; business guidance, delivered on Riviera achieved straight strong exceeded results. third now adjusted Turning EBITDAX the spending. adjusted EBITDAX upstream quarter Riviera and The has operational production our lower is and This that production met to or quarter fifth capital guidance.

an STACK year strong with in Ruston in sales of our in turned Louisiana, prolific expected wells this to far wells So XXX%. have over and North position, two we six results, our with field IRR NW

quarter During do quarter. and not the fourth wells plan the drill not wells, we any third in drill to did any

plans both results plays in However, reviewing with we by encouraged the currently XXXX are and for remain the Board.

Greg, extremely Before handing extremely a appreciative employees. moment back to ago, as optimize our of what hard months we accomplished Since a have company pride. assets fifteen working value been only our of and thank wanted it their am Riviera formation with The look I together take to to to employees I efforts. over the I have the on

a work and first-class am we with fortunate have I the day. to organization every and each team think I

I will detail. operations to to now more Blue discuss Mountain the over turn the Greg in call

Greg Harper

quarter David. progress our significant you, business. initiatives had on we Mountain a Thank growth Blue across midstream our as very busy third three-product made

were gas XXX produced average On nine XXXX ending throughput gas side, of average and the bpd. throughput year our XX, throughput gathering our NGLs months to projecting are natural was what we MMcf/d, was gas third the and be. XXXX processing line XXX full X,XXX natural September for the Average quarter for in average MMcf/d with

the preloading our XX XXXX XX producing while hampered and quarter, of on the primary of these quarter volumes fourth wells of to We on return to third approximately the sales quarter customer's During Blue the to throughput average XXXX. second MMcf/d contributing an our shutting-in anticipate XXXX. wells, turned wells XX the temporarily system system; and throughput quarter be Mountain continued or since we by first loss in the volumes to of

acquired be Operating, Citizen merger As to you into Energy entered Roan by agreement LLC. are probably aware, definitive a

to met transaction, through completion and plan. been reduced Roan close been with parties assesses activity throughput from Citizen steps and We've their flowing gas quarter. to has put currently are expect drilling connected the of remain new both we as Roan attaching as XXXX water has attaching gathering build remainder pads the hold go as we As volumes its relatively where required our split flat on the during out fourth also volumes the to are regulatory and we operations CEO during still the system Roan

the third the XXXX. October MMcf/d Blue was Lumen during at X, connected gas system, the beginning addition, In of Mountain approximately on to throughput the natural adding cryo plant, quarter, system X

last acquisition of Midstream closed our XXX% LLC, an on announced we of call, during MMcf/d in including Lumen quarterly interests we As gathering our X, XX gas processing Partnership, miles August and approximately plant. XX pipelines XXXX, on natural

water began gathering XXXX, X,XXX on in bpd pipelines for we averaging Turning Roan the third during July to water, XXXX. quarter produced of

water its X quarter the transport of gathering of during averaging continues the XX,XXX XXXX. produced total, services, As the hauling on it company system, third-party million of barrels third bpd, water progresses to via trucking buildout water in or

over Blue term, to volume large X,XXX September agreement In commitment Mountain be new a facilities three-year services executed minimum a XXXX, November in-service bpd estimated of water agreement a XXXX. The independent in a includes producer. with with

in-service and through more has Mountain Blue October well XXXX. non-operated placed is capacity service in Blue which well fourth disposal two in first disposal another wells, disposal constructing Furthermore, water and in acquired of that addition, the in in-service owned Mountain operated to additional of went is In one quarter its has XXXX. a be estimated interest

and between remaining With piped deployment managing is the trucked assessment their volumes ahead of Roan, its performed operations to capital decision by being optimize getting Blue without Mountain making.

systems ultimately entered are XX Mountain agreement into North of gathering of in mainline miles of with approximately commenced quarter, XXXX. an the construction a South Also, pipeline, facilities. third The on crude and and Blue consist half first we has in in-service the Roan the date oil targeting initial and will

by impacted During related Belvieu, hedges Also, commodity by the quarter, these overall to Mont the differentials business and and differences. pricing lower volumes the with at prices. the Conway lower to along impacted throughput ineffective business pricing be continued NGL was

results. added Mountain's compared EBITDA. with elimination of the second million quarter settled quarter would Blue by result, a $X.X adjusted decreased EBITDA Adjusted Blue the Mountain's of $X.X QX As third The have in to million hedges impact

basis quarter ONEOK's is XXXX We completed. of Arbuckle Pipeline when all dislocation first expect in the eliminate II to

also QX versus in before, mentioned quarter the by third QX. to extent I As were shut results impacted in our greater volumes, a and

Capital expenditures in million, invested for were third approximately construction the pipelines with and $XX quarter gathering capital of the the being water disposal facilities. of majority

near the our water will we capital less system, capital While keep facility, to open treating look new more reduced continue activities several disposal have as treating added additional do we however disposal the and for and we connection wells, customer for a optionality previously in our for we to initial our term.

excited it turn and very I'd to the we managed our that like growth-oriented for customer Jim, attractive Roan transaction say remains once that I play believe Citizen strong We financial that be a announcement. sponsor. a team closes with strongly Before the and the very to by will over Merge are

Jim Frew

Greg. Thanks,

up liquidity, third sheet and to Q&A, guidance. and X) like following call X) for the quarter upstream I'd performance, the opening Before X) discuss XXXX items: repurchases, X) balance share

was per averaging than day. the production also quarter expectations. in-line million. from the of Of feet were that, EBITDAX natural gas sales, expected remaining natural oil, from equivalent in-line adjusted guidance, In on from revenues cubic Operating sales, XX% million costs with total capital. revenue sales NGLs. approximately and XX% oil quarter lower XXX XXXX, This solid gas of another and and with the was was XX% had We were third $XX was the of NGL approximately with

Upstream was third natural operating was compensation was which that, $X in-line costs, capital. Upstream In Upstream by were compensation to General quarter and capital expenses based with were XX% million the severance investment while costs, and and remaining the the of approximately guidance. guidance. based and share for $XX Mountain. million $XX guidance. the excluding severance excluding the of Riviera's during to the oil $X Blue end low $XX costs, quarter, capital Of third million, million and at million approximately gas the in approximately approximately Mountain million. was respect below costs, business, quarter million With attributable quarter $X incurred approximately invested administrative third $XX was was Riviera Riviera approximately third the Blue quarter. third invested G&A, share

Blue and sheet facilities. respect Mountain Riviera liquidity, have to and balance credit the separate established With

September XX, million asset Hugoton Riviera's borrowing of of base September of of sale $XX expected credit. capacity In including in no outstanding Basin $XXX borrowings $XX remaining to approximately with pending million was were the of revolving connection letters XXXX, borrowing inclusive As from and on credit outstanding facility, sales, Riviera's million reduced XXXX, available there properties.

XX additional was an utilizing our pricing the a than for year Additionally, previous better facility extended credit points grid RBL. basis

commitments borrowing up million. total Blue Mountain to with of established separate has a credit facility $XXX

September of capital Blue of received to million success $XX positively had and covenant Blue $XX As outstanding restrictions in subject on the of liquidity $XXX a million the XX, its fee Mountain borrowing capacity, drawn facility, inclusive available reimbursement credit approximately was impacted by approximately letters third XXXX, Mountain Mountain's and in Blue million Facility. Credit of quarter. credit,

XX, approximately and held approximately $XX consolidated was million $XX $XX September Of XXXX. the Blue balance facility, in Including drawn million $XX of cash Mountain. the credit cash was net Company ending attributable million approximately of Mountain's XX, was had approximately Blue XXXX, business, As that, by September to the Riviera's million $XX on million. as Upstream

Company's the offer million since returned since July through XXXX, tender The inception approximately XXXX, $XXX total XX, of $XXX On August and of shareholders of over Since year, Riviera to million to Company an a capital program $XXX inception $XXX of million million. in October our a XXXX. repurchased authorized million. total XX, over X repurchases increase repurchase the share the $XXX the beginning has Directors Board and million for shares of a has to through cost

XXXX, Riviera million had outstanding. shares XX, XX.X October approximately of As

we Upstream Hugoton taking today, assets remaining in guidance for Basin the our have our to XXXX ahead, guidance the quarter. close presentation Looking into XXXX. we year to fourth expected supplemental provided consideration website upstream only highlight posted In full the

is EBITDAX for adjusted our year forma pro $XX upstream million. Our assets forecast

to to in million XX% million and $XX With leasing, to Approximately quarter. last the water to to Mountain approximately upstream capital, the Mountain $XXX the crude XXXX, seismic, in from gathering upstream invest and is respect business Blue Approximately be will expects devoted capital expects in will dedicated of drilling, needs. allocated gathering. build capital construct a remaining to invest balance other The million of XX% with system $X is to the XXXX. Merge used the gathering be a XX% down to gas natural capital Blue system.

in well flexibility. great sheet performed third In and us closing, our the assets allows quarter our balance

shareholder to for Moving shareholders. maximize and forward, ways to we continue are return to we capital to to finding committed value, look opportunities

will call I to With operator the for that, over this hand questions. to open up it

David Rottino

the I'd thank you. concludes morning, like support their everyone our for thank you. to call the continued Okay, company. call today. of participation this and That in Thank

Operator

today's call. gentlemen, conference you your Thank this concludes and Ladies participation. for

disconnect. now may You

Riviera Resources (RVRA) 12 Nov 192019 Q3 Earnings call transcript