HPK - Earnings call transcript Q1 2022

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Operator

Thank you for standing by, and welcome to the First Quarter 2022 HighPeak Energy Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today’s program may be recorded. And now, I’d like to introduce you host for today’s program, Mr. Officer. Financial Chief Tholen, Steven Please go sir. ahead,

Steven Tholen

Hollis; Thank Energy’s first and are and and President, I’m good Ryan the Business Representing morning, HighPeak to Chairman Michael Hightower; Jack Financial welcome Steven and CEO, President quarter Hightower; today of Development, everyone, HighPeak you Vice Chief XXXX Officer. Tholen, call. conference

on call today’s we performance. will XX-Q, Presentation, may XXXX quarter first and forward-looking call, to reference Form Investor statements Today’s operations, and During the condition, earnings can plans, which HighPeak’s make certain found company’s future be our assumptions, goals, participants results to our website. expectations, release, relating May of financial

So expectations of which risks results variety that please statements actual many cautionary company’s due forward-looking of differ reasons, the regarding and in from materially to fact refer may related control. a our to SEC the are information the filings, our beyond including

non-GAAP on refer We measures today’s financial also call. to will certain

Monday which the So reconciliations see issued please earnings in release, was afternoon. the

Our will now on prepared I Chairman call to over Investor the and slide our our May remarks four Jack turn Presentation. Hightower. of will CEO, begin

Jack Hightower

other you, far, parties. HighPeak. good Steven, everyone, and to investors This stakeholders, given Thank as presentation analysts as is, morning and by that exciting the well in most our we've and interested to-date

other details are to our as announced we on that additional the recently update well announce and our and company shareholders properties, have We quarter. provide pleased the acquisitions last of on the consolidated progress Hannathon over as

going continue current at current try [ph]. substantially in as this as throughout presentation. rates. generating transition only can not prices We expect be flow time these updating the year is of information which be to if our maintaining neutrality XXXX, to approaching we significant cash US from in production cash on ago production and discuss a of increasing are and flow half we cash during second you growth. to and the company And today expect trajectory we're and will free a to obvious much to free year this We're on compared flow. going one the positive to few, substantially production If this prices, the We're spend while all company different the levels is to

stated I've story. differentiated As HighPeak is before, definitely growth a

If our press you'll bit. now Hannathon guidance stock’s XX,XXX a multiple things. to our we with over the say, the quarter and XX,XXX fact, almost missing interesting you barrels added added crews, in is about approaching our online. it's refer there's you that in and of release, XX,XXX to press And [ph] the almost is And have of completed throughout today. terms progress are actually in that we barrels We've we're three said your first going coming we wells day. guidance production? maintain our drilling -- year. to rigs. We're Well, additional are where still the were what that being might ahead production turn slide quarter quite we say, is XX to now to frac We've to at four in And buying XX,XXX right And legacy I super want look HighPeak many well, when recently, the everybody a easy release from the barrels a barrels this presentation, at opportunity. XX,XXX because if production in down first barrels went

is operating profit and of margin highest an our which the the $XX.XX have unhedged industry, cash We margin. in

that's to we to go see we've accomplished four to and XX,XXX a our -- gone group -- you're going -- keep scale people acreage increasing acres, interesting realize acreage. in with done and our the a in what operational our months exposure more in from Another an almost is And XX% lot to increasing things as Midland relative conceptually XX,XXX the thing and increase presentation, overall viewpoint. and we've production addition that that don't is in increase is position, through acres

We our acquisition three us acquisition million liquidity and to terms $XXX net also the increasing million at cash HighPeak. along acquisition, locations X.XX almost [ph] of This and XXX -- North gave very is of we announced of the shares also our EBITDA accretive shareholders. the for flow which in a a with Hannathon what large very, multiple, the times transaction in increasing the leverage Alamo call

it $XX So million of plus and present acquisition. value had value terms a in that economic -- in synergies

It the and Then up when important production to fundamentally we almost the from back with reemphasizing anything question, anything to in going go X, then presentation. of the in XX,XXX day, contribution the again. doing. our is contribution again going actually you of that down you of When very then rigs barrels. down up we're that happened you a the quarter. see wrong And barrels second part went again going There's day fundamentally and a entire the is that rigs? does begs do down with It what similar Slide where in why crews, you frac. you're you not this down There's shows back initially, to the and down? many situation the some up that's most you can in to page XX reservoir. frac barrels public add at block If it does and look last these turn Because slide can't negative you'll why when and XX,XXX a from get get the probably wrong go now not history anything bottom --

shut we up time to in to XX that in next -- different literally during points wells quarter go have almost at You level. the

our almost our was coming you year, anomalous. put about year, not production on I'm Personally, like X.X we're of growth This a you company. and we this in have basis, But our higher. forma projected. at star is XX,XXX throughout star months, XX,XXX projection hitting Now between is going on our about an exit barrels talking year average first fifth pro you the of in increased we you going And production Hannathon straight still are our the doubling is and with higher same a on more of of spend what and isn't our XX,XXX actually the we presentation. to numbers. through than in it's pad average. Hannathon, a getting and sites we the for part guidance where barrels that is our pro day. forma the we a up production start that. profile But to even then an if look XX,XXX midpoint the And time and taking the the later just phenomenal growth It now down. see of come so see that take for if with of we you our XX,XXX year when go from without rig sixth your showing fourth, day, from exit going don't at until profile I'm this lot at end When Hannathon excited impact that And year. think with day our and then about this slide shows as are to barrels temporarily And and the place. Hannathon what's even to a the rest locations

this looking keeping with is in at you almost and day aren't of numbers. but the sense exit we hypothetical growth continue day a at rigs, We weighted XXXX. our XX,XXX an XX,XXX Now it's six barrels going going into the mentioned our to a to a that go gives going Slide This and XXXX. of X, as oil beyond barrels end in also on. of about profile, to of average run production plan These going

these on. success we hitting are as We drill, we're we having and planned numbers had that the

We our to have increase had budget. capital

when the go for accretive now now are already are the we are, go as and we prices XX we forward of count with out is not that roughly rate we for wells today spending exit progress will right where anymore continuous rest be they pretty in forward from where time. oil are that Our

gives the which above on basis, $X.X average and year free flow cash And successful, very, expected very billion maintaining So of as in that's to an go rigs just billion, tremendous at end to very, we are exit. repetitive, us in process we we six XXX And almost XXX excess, which and us be forward, still very $X with gives opportunity. almost a the XXXX, locations now. drilling new

development now. is cash bolt-on shows of adding Flat look scale that and acquisitions, into the of three X, flow, left-hand basically side If on first on our divide Top. It the is the part opportunity, page we which which you Page

there. kind And that's going north Our is of because area And the showing up it that in of put of page. we're where north circle over the but lot acreage opportunities wells. black county we're talk We've middle net County, and the doing what added that, to in area. black have the there to is this we north Borden a foot we about all the well that to performance. continuing more to drill a It's the is line and XX,XXX the of areas to call line. these that's bolt-on And in line, almost XX,XXX together dark acres lump

that added able up But XXX% in is into excellence present and to whole buying a now of you It's production the that almost double to it infrastructure stage now go a that's in acres moving three Mike area from the area. about and those not year to a to acquisition, of production western X,XXX the XX,XXX to multiple adding acres excited area. control We operational day. extremely going but to where XX,XXX You're going that period when between to be talk on this, that talked Hannathon this times area. at particular and about wells. barrels XX,XXX X,XXX to almost that happening the at much from being part to end barrels adding we as I'm of our what's

I'm shares. extremely And the going to I have and because what sell And I'm are largest have think shares So company looking to we look, shareholders you one again, on. excited shares, to relative of to it. not we're us acquire try of so about none going can more why give undervalued you selling best is Mike I'm the best and the in insights guess over turn are about operations, the to I Hollis, the to going that on still margins, Mike? say to talk operating to and insights we who's the business. is on thing our profitability next peer-leading I thing

Michael Hollis

You Thanks, Jack. bet.

unhedged continued now different peers equal. heard than most mix We've margins. our highlights The to Basin. me got slide peer-leading if the commodity of say X. margins. are much QX before, BOEs this slide not Midland X know, XXXX HighPeak’s You all Everybody you created has a in

above peer Our QX than average. XX% XX% the higher peer margins were and our closest

are to further our We positioned cost with initiatives expansion and production of also for increase. margin as continues LOE the dilution fixed reduction our

HighPeak’s per compared Our to QX forma G&A QX average Further plus from of would production it pro based way, per peers estimated over to is EBITDA year forma day. margin XX% per of BOE XX,XXX margin BOE is BOE pro higher $XX BOE another actual peer of near-term reduction basis, I’d current XX,XXX on equivalent current margin adjusted at power and per average. production equivalent on pro projects day. equal uplift our XXXX our our per rate HighPeak’s production take day forma profit to the XX,XXX BOEs say in

in Flat Top move the as X, Activity. east We Top. to slide past and turns Flat about the potential we our faced now to acreage Turning

oil our well All stock But similar be tank. the share would across in results as block. entire to had some it modeling we suggested I'm pleased have now that of our

recently have the have per over oil per on shown we gas. wells some plus As is to barrels wells acquired newly far oil again the X,XXX oil in north in and some has IP-ed red reached above our side southern side reaching These new to Similarly, we rates of per area. this on drilled X,XXX with flat associated per barrels well day. be that with rate the oil testing day in barrels of of that It as area. day will assume of X,XXX of of initial D in far several have results of operator validate day, of Wolfcamp speak a barrels acreage, this to of top, oil D had our Delta the per Wolfcamp the exciting that peak demonstrated east barrels day. up that map, an To XXX acreage HighPeak of X,XXX the safe the outline offset have oil an

and of top to two year. We frac in mode remainder four rigs run plan in the full an manufacturing flat are for of and crews average the

and excited recently XX result to power. are reduce across operational to over our been over front, of flat process the has rental field in This our LOE. top of substation highline we the the commissioned the significantly wells say, our switching I'm On will removal in generators, that and

We give second $XXX,XXX power, removed the power drilling are rigs us estimating quarter, in that to also the we'll factoring which of generators. our of on by those of roughly diesel could prices end XX will The savings ability electrical substation XX-plus the today's over well. provide a have

tell farm are still completed able be hope to drilling be third Sunshine. to in year solar is we actually later quarter. track that, Our And on project XX-megawatt to with the I you this

factoring of operational and trip trucking $XXX,XXX when and savings up in cost. Our current project sand round projected contracted provide local sand to be estimated to well, to June, in per cost reduced is mine is

the flat of efficiency. the sources infield servicing and local oil natural And which fluid completion for report of includes system these Again, is gathering system, stimulation excited system HighPeak's, and manufacturing low-pressure expected fully all operational. I'm of also X be enhance initial mode. the gathering tied quarter. flat we our is HighPeak's, to initiatives system non-potable remainder currently crude nearing Also is is recycling in our capital of in operational by gas operational, are needs and crews fluids and the third to is in top. water section infrastructure produced Our top XXX% water frac

I fantastic more couldn't Peak we our have modeling and going about to Turning meeting Spraberry, now Lower are commercial. XX. from geological in expectations. forward. activity, recent cores. oil this in Signal trajectory process delineation our includes geochem, be and was sidewall confirming, in area slide tank. of before, be the analysis, of our and petrophysical well its A, growth We wells Using cuttings cores, moving to XD excited this the Signal Delta Ds knew our like models, importance exceeding well success this Peak The are whole Wolfcamp our for or results all the now But interpretation increasing stock area We area. this stated Wolfcamp to which all region, results in seismic,

XXX being Lower and located oil per day increase March, the our and the of online in wells. validates production well rates our across [Technical XX,XXX-foot delineates the map This should of XXX of Martin the online barrels location recently of the barrels oil These entire in per far excited block. block. day, and our newly location Wolfcamp completion across respectively. bullet the wells currently the drilled spanning were these to continuing was second producing number Wolfcamp announce Bullet center continuing These we at Wolfcamp Looking Peak. A on in designations, block the have of and well pad up. speak, our in and with are wells ramp wells we These scheduled location and our being Wolfcamp of of drilled our is one one D block. oil peak and quarter. XX,XXX-foot acreage currently three, end legacy Wolfcamp frac a also updated highlights legacy five for XXX with of side area D producing location successful center a Signal recycled These them with represents acreage Hannathon's Peak job of two-well acreage the reservoir in the current test on XX,XXX-foot our as acquired test acreage day, Wolfcamp rig one-rig we already lateral of are in our average July XXX and of is plan XXXX. laterals a by two early our on significant the I'm to four-well are commence high two-well B. acreage eastern on number have April Powell of are that respectively, our associated block. utilizing been Signal and Powell Bullet of legacy should a In well were side the feet This the the June. Wolfcamp location productivity Bullet shows are the across shows XX,XXX wells remainder online D and completed of XX,XXX-foot turned online provides reservoir a very B to of four be fluids our continue center that and online Difficulty] and the Partee successful This acquired wells turned turned barrels current of currently in up shows of current and the western drilling of formations respectively to program barrels oil are and on conjunction prove our Bullet we guidance, the wide to and of the third Spraberry February position. X,XXX D gas. number from XX,XXX-foot pad Hannathon to of

discussing spend slide few Peak. to the picture infrastructure XX. at now I I'll minutes Turning a Signal

can the acreage As with inheriting extent fluid see acquisition, includes on which you the a their of system full Hannathon we and pipelines gathering covering comprehensive will infield map, produced position. three existing our be SWDs

on we back continue to the acreage the recycling capabilities. on XXXX, system provide legacy for it Hannathon’s to During to you will build integrate into be the system the peak build-out the effortless increased remainder the to as And high-peak almost map, water can out see high again, West. of will legacy

out we soon the plan Peak discussions in very oil as Signal be and with to well. across multiple gatherers currently manufacturing to are in mode a in build acreage, We gathering system

get We economics, and wells well, will times in at sensitivities compete very The details high oil type at barrel. Gillespie asked D Peak XX for price, today's lower are curves prices. on slide provide Peak deliver Delta single with net a laterals. and low value. and Slide but D cost shows oil. as even They based high quickly These pay Now commodity Signal rates capital. high from X.X prices, XXXX year-end the Wolfcamp Wolfcamp achieved oil recycle Wolfcamp B is, will. out lot also for tremendous Wolfcamp return economic XX, a it answer present Signal reserve again capital absolutely, a payout Economics. and of The report turning Peak from about if as our D our Cawley, XX,XXX-foot still to it very The as breaks provide compared price. with graph They $XX ratios $XXX Signal

turn to slide HighPeak. XX. you If at ESG now

Our ESG initiatives of are environmentally stakeholders. fiscally both rewarding our and all to

XX% is and evidenced ESG throughout are in environmental efficiency right the cutting and only of presentation, the needs in water do social fluids our utilized for Flat recycled system fluid our from providing quarter stimulation Top, but are As and are Top rewarding, systems. not initiatives everything also perspective. entire our this our over recycling The in we and fiscally for we cost do. Flat put from thing stimulation inherent investor We place an currently to efforts in fluids of non-potable first in XXX%

material consumption. on substation power Our not needed only result total allow natural cost, down operations. rigs generators and in the only mine and truck dry that's in on to result the will of standard and HighPeak OpEx would associated electricity local our money reduction sand emissions of combustion and fuel which will cut wet-sand in but the side sand gas of a result in the miles the reduction the carbon us will power, us of removal equation, Utilizing will but solar with save and not CapEx rental

and from not increase that also realized will products, reduce receive systems gathering new trucking emissions. prices our but our Our only we

in removal Flat fully safety once per result employee of local Our oil to the say crude that I'm had have system, incidents gathering operational it's XXX trucks extremely And to proud still zero day we date. from Top will roads.

steps mitigating saw We're slide what this It's capital cost are escalations. is combat So Again, all We cost Turning and how pressures attacking to rising in about pressures supply real. chain constantly looking it? pressures. sides inflationary advance of to now to increases. management protect inflationary serious coming cost preemptive are XX, these details doing against equation. ahead from savings the you and took slide

rigs such and pre-purchasing diesel Again, a saving instance, off the For capital tubular which will and per vessels electricity on XXX allow trucking, will $XXX,XXX power, round miles, cost. mine on again, from save ESPs. potential the wet-sand to XX, trip our than run reduces well equipment, has HighPeak the tanks, of to side round-trip Top as cost us our again, goods, substation and less project for solar of reducing Flat

Top inflationary As CapEx put The is I'll preemptive we with over Flat expect we despite that, our supply in that Peak. chain serious recycling this turn within entire budget, slide main provides to capabilities measures Signal due both affecting cost that mentioned before, to stay And from and pressures our water back increased our system takeaway HighPeak place, guided to the in are that Jack. and industry. the call the

Jack Hightower

with realized areas our excited in divide of industry. the success of we're XX. It a I talked and emphasize turn the Thanks of Everybody on we we're having doing for, preplanning that slide companies among at basically of XXXX from what to cost that of and see first right we year a the that right Think low we're between activities two at to guidance a maintaining finding again, to guidance so our day midpoint going our sense, about terms coming, to development that an in barrels pricing total to expenditure to costs is the performance able are great at XX,XXX barrels capital XXXX that very tremendously because track quarter us will day. the budget, give highest XX,XXX XX,XXX that about. did day, track showing showing exit Mike. and about, many a want next you of it the barrels still on complete didn't for, being average cash end end

what you everybody is focus that to And when no growth at want that our our you and see question is responsible to a that continue growth. now that's growth, looking on look to on, is and XX. at it's going turning slide So, There story. I and story

are approaching budget. own but complete success not any complete, within now We overspend, our

definitely Mike to team. excellence, have his operational thanks We and

We have post sheet, a balance strong even closing this.

borrowing going and to we in borrowing to equity. great equity. terms one said, are In to our be we're utilizing shape a year reserve money to maintain base, from always debt of going debt We've

Our to implementation margins maintain also. most and And companies in goal is going things our actually, believe are. actually the are the over-perform. basically Mike that like with of up, peer-leading going talked about, down, margins our of under-promise We instead

weren't We are numbers. maybe hit and not which could at running our we well, numbers. those quarter-to-quarter, you didn't company our Well, look say, our

Our guidance quarter-to-quarter. yearly based on not a guidance and basis, is

is going to are accretive do making relative continue we make sure we we that our we today where to things making is Our the do time a quarter versus shareholders' basis had includes well for running to company where consolidation at opportunities, of the that. we that we now, all ever end And money. to were take -- the produce put continue responsibly we've to we goal as our that truly That great made, money to doing the sure our we're on XX We're profit on the do drilling Right to the is as acquisitions the forward. making properly best year proactive wells on three and that and of everybody. when to and it fingers. the going an necessary this wells maximize program basis

any and So, anybody it we're questions have. excited open about up the that presentation might now to

Operator

from Certainly. [Operator line Capital. Instructions] Our first of the White question John from comes ROTH

Your question please.

John White

of that I has like guidance appreciate off updated from production doesn't offset time time-to-time. include knocked and the I everybody and being -- spending last guys you hold line wells follow to -- and happens north slide did me concern know me. where you been fracs. to to glad tie you're that going not People my is the I'm morning see industry acreage the a Good of on lot the Jack, It flat new call. the top to on to four by

top Hannathon north So, Signal South that Is West. mainly the to and flat expanded expanded you've you've correct? the mainly to the with mainly and Peak the

Jack Hightower

Yes, that's correct.

John White

And is block. going part top, Is and on then nine the to indicating that correct? part the the focused going of flat are at the forward the northwest southeast circles on slide on of activity be block

Jack Hightower

X,XXX Yes. the down way and area two are to zones the demonstrate We'll block all to east coming now south, show more drilled a there terms moving of the across and it the of other and there we development, regarding that the to down in in has and and been even were was are but of day there acquisition wanted to why range the that we northwest just we results barrel the made terms and drilling Southeast -- showing new that the moving then that in X,XXX the wells been our being to have questions success that in. activity have since we have since what in wells northern

process we now the be to So, entire in that the is and mode acreage block. start developing it's whole just block showing will perspective

John White

I'll along Okay. in queue. back clarification for it the and Thanks pass that get and

Jack Hightower

John. Thanks

Operator

you. Thank

Our from question comes line next the Seaport of from Pope Nicholas Research.

question Your please.

Nicholas Pope

Good morning everyone.

Jack Hightower

Good morning.

Nicholas Pope

Hey, little hoping guys I a was you Peak. Signal bit on talk could

the thinking those of confirming asset, with all A I kind what different changed, acreage a new thought I what mean, like the guess bunch Wolfcamp it formations? here. is think data did Signal kind like or you of position. got the and Spraberry -- how you D, the in across Lower that learn that you or it being fairly has about the new of and you the kind about Peak You extensive extensive on of confirming the what kind Wolfcamp It of potential be could have all just looks been

Steven Tholen

initial You our going Peak It productive bet, A on and and our Nick. right. Spraberry, very Signal estimate Lower that confirmed the acreage. Wolfcamp No, you're exactly perspective we're to be

over is Wolfcamp look the kind the if Hannathon we out, to closest block. obviously, step the of at you the production A A, of Now West Wolfcamp

Hannathon a we side the we least have here again, barrel the prove from move Peak and the our over more of Signal drilling a block. part into that to X,XXX production gas over of of So And up of or helps and X,XXX barrel Wolfcamp where part to A the legacy at we day today middle day expect associated strategy well. have it western

So closer. Wolfcamp the its was exceeded East, in to expectation. just there of West our little the of The to as and North perspective acreage it's from a Lower again, area you But control D, our mentioned, South the bit block. The delineation a more of the well. a and little was confirmatory the all again, it well way Spraberry, met

again, have as Hannathon we're add, the as some in Wolfcamp zones runway about know don't of three you as So has well. to the B, I delineation anything done you Jack? those if very want excited well else

Jack Hightower

lot result the But also particular all a XXX the the go a really -- exciting across, to now, No. thing technical drilling petrophysical but about not that we add further going would we formation towards I our think economics happening addition we've the of commercial additional inventory. the all those to there, sure Nick, analyzing cores better delineate forward. in and some undoubtedly, The across perhaps it zones, as talked locations we And add, seen roughly way and this to we much XXX XXX work the and And way only And And hurdle as to a of is area. analysis, our do of have in sidewall analysis, -- understand we it. core of don't of will we've things too do. that done was I'm even it's lot we that you've this evaluation. make much so majors add goal

excited really we're So about it.

Nicholas Pope

D versus how kind great. I with of think about where you the the Signal where I seen kind like the That's you've of terms of in kind both of in what in changed And the … Yeah. and Signal anything Peak like guess, like -- kind as kind guess, Peak. And are look are of think Spraberry what's Wolfcamp Flat economics Top like? comparing, hierarchy and of Lower what what or -- the of you at delineating compare do priorities wells economics, we has

Steven Tholen

Yeah.

the Flat is they're Wolf in the see There's the same the the of You have and in competitive. bit appendix, go on in A, the Signal includes Wolf basically it's Top Wolf overall, better the A so comparison to area area close. that economics. those no a little appendix, D and the and They're it's but which both doubt in on economics Peak a in very presentation to economics terms -- the the and you'll great in

Wolf Our breakeven the our A, of D, XX excess oil both in in XXX% in $XXX is Wolf cost but XX it's areas. at the on returns are

good comparable. on It's investment anybody acreage, profile very Midland very the of these in anybody any put the and would has their in tier it's or So, the in top Basin. Delaware

Nicholas Pope

Awesome. That's great. I everyone. appreciate the time,

Jack Hightower

Good. Nick. Thank you,

Operator

you. Thank

question the Robertson of comes Tower from line Our Jeff next from Water Research.

Your question, please.

Jeff Robertson

morning. Good

lot block of a western initially or Mike your at development the As you you wells you have flat Jack, on you moved densely mode. into spaced all where side of top, look --

go Alamo, impact type into the not either move bring from wells east north you offset to or the having to you away were will online? as there assume you fair it from have As out, same of curtail -- production -- to and is new you

Michael Hollis

go infill had wells, delineation side. of had Yes, Jeff, and kind book some some we of mentioned, that you in kind production on drilling either as our and had of to

But mode, you than well effect, a of going that shut So, some higher amount over as of of was as go pad. little last of to water the on yes, a protection, had couple to you're the for quarters be what see out And, we you'll wells side in manufacturing again, drill of wells set you off to to one more when wells. only tend forward. also, going a

So the profile smaller the will production that as have. enough as over the disruption base accelerating. large overall, well well to that growth as we The amount as getting growth is is of time become now,

apparent well growth per or off in day throughout a four wells forward. quarter, as profile on barrels hundred the less we for a five off of and and couple will have become go less to So

for basin it daily Just less production, become see going water-out us and big how know, effect everywhere you an forward. every company in turns just effect. percentage It's and wells a the will of do of less off in sees the

Jeff Robertson

they to generally those to curve have generally as And, type Mike, returned have wells wells returned their come you've profile? back production, --

Michael Hollis

on part in those weather and different of X.X the one fracked these Permian wells through shutting in through almost And times that the had years the for lifetime. the rest of for do wells number have cycles, to just return have -- old got side and wells them of a those every Absolutely, We've between that on. in either happen, at come of center their back production basin, events wells in wells turned through on shutting the times. like fracking, events, they of COVID, wells off get or many events, general, turned and went

You flush back production, little they curve. right come type a then get to and their on

Jeff Robertson

Hannathon on deal, a when referenced announced that had Signal XD think you question I A survey. they all you Peak, the

your you a them use of I XD together Wolfcamp of the and those to within maybe think high-grade you have two side merge all Can D survey the landing surveys acreage. zones

Michael Hollis

Absolutely.

the of integrate modeling utilizing to kind pathways it once be seismic close able same XD legacy be now we'll and our we trajectory that utilize of and So, to XD able in that earth of has in course, we're transaction, Hannathon the assets. all the

Jeff Robertson

the formation correctly? that remember right, I that I am If is -- pretty D a thick Wolfcamp peak. Signal Is in remembering

Michael Hollis

pretty XXX-foot You thick, roughly that It's sir. are Yes, correctly. remembering thick.

lot in again, of So place. a resource

Jeff Robertson

different you testing landing Are zones?

Michael Hollis

we -- what as we've like to we do zone -- kind our scientist We've like pragmatic today. of a got and sit engineers, And of works. again, got -- we to just landing we preferred kind being

zones different Now the of D, for results. now development does in with but some that landing and leave into performs know stick it future to produces within plan is Chevron our does, Wolfcamp kind the the right preferred these we room what

Jeff Robertson

last… And

Jack Hightower

tremendous you ability recoverable for be net plus now One that years. a is perspective, XX And and high this is in could to area the now, This of add, a to been look looks doing in about, Nick, $X.X macro talking says this recover big we opportunity XX% the Mike in zones, recoveries. from from a a improve that the we're and United process how the peak the better this to over I've the reservoir, managed It's these landing States. thing these and the to now expect complete the we stock would approaching what biggest fact, oil. and at the to time, tertiary here maximize Lower and our the And area over case, every take. from oil Lower oil when which I billion floods Mike oil and one have how tremendous oil picking place barrels zones, perspective, and XX thing in recovery wells in team zone the will of the don't of to getting in better different like be And out to every are fields recovery. of XX, reservoir, in figuring

the of that such a it's have as we and oil time So fact to get better better on. amount place tremendous going goes in

Jeff Robertson

question on last One infrastructure. Jack. Thanks,

that manufacturing saving bigger legacy discussions when And you system the you all that as block can a the Signal all into you this you and deal? you Hannathon will cost how on water it's has can crew leverage existing think about you acreage here? cited on to disposal about provide acreage cost mode a measures, with your that You announced talk whether deliver acreage. gatherers there can highlighted you that Mike, or operational Peak have bigger synergies solutions start across power are the

Michael Hollis

bet. You

Hannathon, definitely from ability If forma existing a the OpEx, gathering up Flat in Signal which on on partners at as well with gives Top did Hannathon again, works Peak we've what CapEx cost side. equation better like efficiency as now the on and have you our block price. realized integrated we how in everything work infrastructure we consolidated look you area to that together, a that big it water has. once pro Having

connecting currently of are water We some Hannathon to SWDs. their with and sending

be one, from well stimulation this there's some wells a have fluid, higher as standpoint we Having across savings percentage accelerate. block day that ESG again, have more as both So cost they entire will recycle a synergies an from to production standpoint. allows from able us from the to

So wells big all a block of product. it whether in to one It's develop and helps. efficiently all consolidated gas, all, having your it's allows water, you oil, power, produce that corridor across absolutely your

Jeff Robertson

you Great. very Thank much.

Operator

Thank you.

the line from John of comes question next White Our Capital. from ROTH

please. question Your

John White

think the to be are going XX think, Slide referencing A and again. Thanks discussion, mentioned you economics the On you for the Wolfcamp B previous Yeah. and I neck? and Wolfcamp Jack, that neck the

Jack Hightower

Absolutely.

John White

control there on that's there mentioned to nice that That Far you name And B substation more real out sounds Congratulations good. Jack, getting it called Wolfcamp formation point on congratulations you commissioned. Powell your conventional Peak. East, for getting well your Hutto. the the Signal for a Mike, that? a Is on

Jack Hightower

vertical in zone that. called block that Wolfcamp And the of zone. of approximately part is it's part Hutto barrels a northwest it's is Well, XX that of produced out the zone. It's a in a C million reason our field there specific the

in we wildcat simply a like did We and to samples zone had vertical in the same well the just how had landing across, that well, of the had well we production area tremendous moving pretty a of like just analysis, amount what -- getting We a going out had the with well and moved we're oil to data. so lot is of the core is in properly And drilled on we it There's Wolfcamp D, control. the location oil wasn't ground. Hutto. area. the much right is the place know enough we the in get and We

John White

control dry sand you thanks nice points and did mention real there, that. for and Mike, some wet sand? Again,

Michael Hollis

Yes.

John White

What's…

Michael Hollis

technology and is like dry. we use to gas job. the but sand, typically burners you typically, it's They've lately completion gotten you and where -- they all jobs then that and to industry makes float and longer all to better Well, to the our having got mine are as to no utilization operations has kind gotten transport in burned wet it's that then wet take that the figured efficiently. recover frac usual headaches and a out that sand dune, able it It mined look to that drive which sand. surface for clumpy sand sand the wet And sand the of to natural very step the and from be a and has sand. off-loaded a would causes of the a out wet from it's how to of of drive utilized Utilizing have frac the lot have sand, cleaned lot use at typically BTUs it's easier

difference. the really that's So

John White

Okay. explanation. pass I'll appreciate I that And on. it

Michael Hollis

thank you. Hey,

Operator

you. Thank

[ph] from next [ph]. line of comes Wexford Our from question Mark the

please. question, Your

Unidentified Analyst

Hi. Thanks in everyone. be to of how general to draw amount a pay the the Can what have give have the of what you about line redetermination, cash excess you to much you'll think timing Hannathon? you talk idea you us expect bank the of order for in

Jack Hightower

Yes. That's a good question.

through We with the to about are want alternatives, financing and because possible cheapest best the banks working and midway get looking all We're that we working process. the financing possible. at

alternatives now. next in And the marketplace going right that direction to with probably XX the $XXX know the We commitments have yet be outline will go know combination So the to and the to it looking idea in We we already at -- an XX amount available will Hannathon within close and exactly for be days. that, we're But we And the go. have should will that. excess as don't be. the enough it have what to we're transaction. of ahead all in million

Unidentified Analyst

there of That's you you're when bank line other wonder cheapest considering? I is best. something does mean, guess and helpful. say a I make it me kind than that

Steven Tholen

restrictions do in the alternative from a on the very is was but bonds. to for this mean, bullish it now going next XX hedging. very are of very the months. course what oil of on lot does RBL looking We're We over year have prices XX it right I terms to of debt a offering that financing. always earlier We're equity The a convertible best -- attractive financing, a bonds, attractive an did

And is to just for our we're financing forward. that strategy the secure available going so we go have into going – that And sure the cautiously that this. have best absolutely that we make and

Unidentified Analyst

you were could switching gears, on put that could barrels you the Okay. number Thanks. of you curtailed quarter? number Then feel a just the during

Steven Tholen

neighborhood average, on, day during probably the quarter. in I would we it at or curtailed But would X,XXX and one-time, Off had wells say, XX of a on X,XXX be Yes. an barrels the to offline.

Unidentified Analyst

and others that's than because be may helpful thought, more maybe suspect well. No, I as that's I probably

you. thank So

very Thanks much. Okay.

Jack Hightower

Thank you.

Operator

any you. conclude Executive Thank program. hand to This I'd further Chief like remarks. the question-and-answer of back Officer, today's does for the program to session Jack Hightower,

Jack Hightower

honestly, I doing this and been to the had it's and on. It's for consulting And what to committee the time, has going is. and on getting is tremendous a where I've down forward report this should young of of thoughts think of executive in companies where you're and we've for equation it exciting and our long new our it It's and disappointing have I've Well, time algorithms gone nature XX-something years looking multiple accomplished periods production public people that public that at a companies. the one -- stock when of their accomplish and most accomplishment. internal production be but our

to going our XXX-plus very are and activity consolidation. what's barrels going in of about going day We this with see reserves production XXXX. a the continue the you're with We're on excited company, and thousand to delineation exit and

understand, what you'll hopefully, you. money So is to my makes to for job and be Thank that's everybody you doing we're make going sure very much.

Operator

conclude does This participation for you, gentlemen, conference. in Thank and ladies your today's the program.

day. Good disconnect. now may You

HighPeak Energy (HPK) 17 May 222022 Q1 Earnings call transcript