APA - Earnings call transcript Q3 2024

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Operator

Good day, everyone, and thank you for standing by. Welcome to APA Corporation's Third Quarter 2024 Financial and Operational Results. [Operator Instructions] Please be advised that today's conference is being recorded.

Now I will pass the call over to the Vice President of Investor Relations, Gary Clark. Please go ahead.

Gary Clark

you financial us call. and thank third APA and XXXX quarter operational morning, for on joining Corporation's Good results conference

of will Executive and and Executive Exploration; with Christmann; call results Tracy and Operations. further begin Henderson, by on our Vice answer We John the and your Also CEO are call color an on of Steve to will Clay Vice CFO, overview President President President outlook. Bretches, then available provide Riney, the questions

to can financial and in GAAP of will the adjusted be information our call Q&A. In reporting cited previous Consistent remarks XX I these in production certain may yesterday's prepared most supplemental opportunity than our found Our discuss be are the on on practices, minutes numbers the found in the directly website the expectations. release, everyone our today's current with today's measures will length financial website. that less comparable financial which Investor measures of A measures. exclude differences we to remainder hour and non-GAAP tax operational press between review forward-looking hope and Egypt had on reconciliation contain adjusted can with conjunction based the you've be provided and reasonable that estimates assumptions views discussion to like and noncontrolling at our supplement, allotted in for barrels. I'd with Relations investor.apacorp.com. Please interest remind note Egypt

first basis, our the I X/X could full and combined. And A on of plus website. a disclaimer results what discuss that, call. call our we a on APA information cause year full John. please quarter note results from materially with to XXXX with located the on APA Callon guidance turn over number actual will reflects that stand-alone And However, of to factors differ is today's supplemental

John Christmann

morning, for and joining you Good thank us.

the portfolio in strategic XXXX. outlook and highlights for review preliminary call results of core discuss third our our cost and the I areas will On and key outline quarter today, accomplishments the production capital

several initiatives This than the the and unconventional $X.X X U.S., and effectively In benefits. has has an billion we APA billion more executed a of operation. delivered enhance value. primary activity Permian create to the acquisitions transforming of shareholder asset strategic Over over have portfolio $X past since of base pure years, number our divestitures, play XXXX, designed into

acreage to First, enabling added our unconventional to by our and position, production. has it than roughly unconventional us scale XX% Permian increasing double more unconventional

inventory and and rig and duration lower portfolio count a than assets rationalized the our significantly compete unit not eliminating And per stand-alone reduces for is capital third, it has LOE. inventory extended increased it is by drilling did today APA Second, Callon that on basis.

incremental free drive capital we an benefit of twofold, economically natural late development to exploration contractual we and oil gas flow primary agreement the which Egypt And accomplishments more and both the Our of for reached in for Suriname. in modernized recently flexibility are people to gas increase shareholder our strategic extended greater price with operational allocation, development. Shifting making and over terms, efficient way Egyptian more paving PSC. the XXXX, PSC and the In life value APA the production country cash competitive generation. more

attractive the made now recently exploration. XX a than our strong visibility GranMorgu are offshore project oil future ago, at gives entire portfolio. us our The investment began of in years We growth most the more long-cycle seeing into that production efforts announced in strategic economics culmination FID countercyclical we when

operating capital Importantly, to flow cash few maintain over we this next believe current us funded our can project the easily framework. through returns be allowing years

sale project agreement in in received investment-grade that volumes of rating the development of offshore partner natural to several Egypt first price credit Poor's, our a X milestones to increases to a announced the important the thus achieved all during Standard is in and for which Energies. noncore contractual incremental on gas the an quarter. upgrade Suriname quarter signed Block on and reached a expected December. APA subsequent operator We of highlights. $XXX close now FID third package our Permian end at We & from and agencies. Total properties Turning We and million, XX we status rating achieving results third with major

from in and prices U.S. lower pricing synergy The Strong second our significantly the the oil These while increased guidance negative, weaker guidance. flow Callon board flow cost to unique still trading. cash for below lies initiatives. capital the include structure, some across attributes while compared portfolio of cash Third associated value under costs which flow flow of integration resilience preservation free This quarter results as our Cash some as the gas curtail near-term from from exceeded successful were cash optionality APA of a Waha the and volumes and production contract capture, were quarter and growth. gas generating LNG strong we lower resilience as prices. Waha Egypt to having cash in specific the organic resource to recent despite price PSC better prices when oil and WTI production flow results from of is real operations well environment. the

financial We in to generate these fourth impacts will expect positive all continue quarter. of the

we areas. the April X, commodity Turning the the exceeded oil price quarter. an our for now pace closing down Permian straight volumes now believe rig Since or we guidance given have on from to is environment. prevailing our acquisition Xth key reduced met count Callon Xst, to appropriate have U.S. which operational XX

and Callon focus turned integrated the successfully acreage. to have our developing We

on Midland acreage are Basin flowing in and are early encouraging. wells the Callon the results acquired initial back Our

quarter. workovers new gas recently with rig the oil of we to the The backlog tracking agreement, bringing our Callon X reduce will Pursuant gross are rig, In workover the count to drilling first volumes XX. and price wells oil rig to and in to The this our the is to normalized Egypt, added fleet Delaware terms in Basin delayed program operations total drilling has acreage enabled levels. running reduction follow plan, production later accordingly. recompletions associated on more

barrel. a we to to partner. achieved the carry announcement $XX.X on few development XXXX. in fund in recently for Suriname. capital Suriname negotiated XX. plus at next good operator, the plan $XX of will gross cost, economics a XXXX Moving summarized offshore and the barrels billion be with cost milestone day investment IRR the per Block first Total, final in is on are OpEx a a by The enhanced cash $XX of an in capital We XX% We at of per development capacity, per operating our decision capital having BOE until provision production when project commences returns XXX,XXX of These production Total as very the brought out APA's years further flow we important

opportunity or we noted, Sea. to first additional development Block previously XX that support potentially projects enhance production significant see economics the of As in for FPSO in our extend North the could the and now additional and exploration the plateau future. Switching

impact energy Beryl, required XXXX. investments that which as in comply beyond facilities at this During platform the to the levy the issued the Earlier coupled control at will line volumes year regulations, After substantial require as maintenance months onerous Beryl evaluation, will emissions we XXXX with our completed makes and financial the with of have XXs operate hydrocarbons on these year, new of with of quarter, production planned. X we third concluded turnaround investment beyond profits regulations uneconomic. the U.K. guidance production were that

Alaska, XXXX, result, this the a a the operations, up revised Steve ] during Saki where will have and December exploration state plans few would financial XX, wrap we lease first on As extensive decision of have in made of finalized cease to what on position all in impacts schedule change statement the we ahead provide details drilling test otherwise will been time an well half production prospect of Sea XXXX. have our further reasonable we [ by to the the North the resume frame. minutes. In in

run the have We very capital preliminary asset and in and of a X-rig and XX-rig asset on Sea, integrity amount P&A currently small our expect Egypt. will to for to program North abandonment. Basin now outlook and long-term a maintaining Permian initial for a activity limited in safety program program primarily plan work focused preparation In XXXX. we an Turning the in

G&A, per and fall This at the budget acquired the significant to billion The to is Alaska. BOE very capital approximately flow opportunity for of be to the the we incremental future program be value increasing highlight integration quarter sustain aggregate, our natural efficient Callon and likely with and Permian year-over-year. a will fuel made in initiatives will an the also assist XXXX We forward primarily on closing, have look had costs U.S., the and that, managing Sea price achieved demonstrating $X.X broadly in exploration, to over the growth the are the and should generally additional the activity cash operational tremendous a North GPT exploration I cost $XXX been XX. And gas Our excellent $X.X Under call an while generate. the these regions evidenced our that I Sea Suriname. of for sustain while a will have million an capital rigorously can adjusted successful Egypt framework. In in and the to Block price the country of to most more we Egypt volumes development Egypt term, and interest new in expect Egypt for the reductions key would Callon costs Suriname value and have to and with much down range Longer and turn good is synergies program will all production as LOE, XXXX. In its to XX% we we strategic targets. million running seek Suriname unlock outlook, year-over-year. operationally XX% targeting on captured complete, potential add North following $XXX allocated like progress to by with Permian of negotiation cadence, we and production guidance basis, Egypt the future billion, and U.S., Steve. XX% needs foreseeable portfolio cost current we free unit in acreage. volumes by

Stephen Riney

John. you, Thank

accounting of common reported loss principles, diluted accepted third million APA generally the a share. quarter, $XXX per net consolidated or under $X.XX For

of most significant As assets sale. Permian $XXX impairment a after-tax assets usual, that items the and results earnings, was which for Sea million of North are include these held outside of core noncore

decision This other revised production his impacts smaller timetable for expected remarks previously X of North assets net our income that The per had $X abandonment the cessation was of adjusted mentioned third noted have or items, John Excluding in after-tax share. asset of the for million Sea. these quarter and quarter. $XXX oil to carry primary million the we in value net barrel after-tax this the which that reserves impairment, we related of sheet. of longer on after-tax North was all and in Sea liability a North to now A obligations We $XXX of balance produce $X.X Sea. million million the of our value abandonment equivalent $XXX write-down increase billion ARO. present no of our present expect $XX an for and

incur We between to are now liability Approximately this and and XXXX. this liability XXXX. end will the between incurred half now planning of be of

be mostly focus mostly consist remaining abandonment. overlap, years on will facility of abandonment will will X while the X some there years next the While wellbore

or production cease XXXX Beryl the to expect facility will We likely in XXXX. late Bravo be early first

Moving over to Egypt.

cash on We the are due of on a way payments quarter And define of receivables receivables. counterintuitive cash our total returns to cash for flow the impact quarter, framework. we our decreased. progress because past past due there on both flow and good When receivables the the XX% made, during purposes free is due continue free for stated make past

cash questions with about have please his these is work focus you model at APA. and reduction Gary If team. flows, area how Debt of a continuing to

quarter and quarters. Callon total increased as on liquidate made coming in with in color which, the credit to in to some The possible. While do front soon to our Callon XXXX progress year would deal provide the in guidance. I debt the brought will to We with our by the in upgrade a changes levels the coupled continue debt our scale of bit so to Permian, factor as goals this pre-acquisition is Callon One commitment and increased third return recent of significant like full S&P. To a on of quarter debt rating our our fourth was acquisition, close,

rig our FID, in well Our October development increased were this rig Basin. capital Alaska were capital full the has which Suriname Egypt. of not to decision guidance, fourth project in spend addition on offset items, reduction increases quarter partially billion, in year XXth the These our another in primarily budget exploration recent Permian of winter contemplated by X previously which $X.XX the following in drill reflects the a to to and

our Turning U.S. production to guidance.

that we decided do. estimated and curtailments. deferrals Alpine area, the as this adjusted reflect weaker-than-expected outlook our to frac we quarter, to Waha note High quarter we curtail With You'll activity have our impact fourth pricing from typically much planned gas of production

We also currently U.S. high decided wells, constructive generate project to have to a higher We production. will curtail under a will impact on future GOR which this XX,XXX some revenue high-volume XX,XXX oil BOE gas more price.

progress to the subject depending fourth is through quarter. estimate this However, volatility gas regional how prices considerable on

price supply gas that, synergy sold not weak Approximately with realization is Q&A. this Waha the these by gas differentials. estimate the of full realized be is our the purchased As into pricing I most of from end to most to you XXXX fourth anticipate with reporting and did turn generally raising activities of to to quarter, target persistence are full for to million our Callon Cheniere the year. forward. And we call income the synergy will are on year this of through contract. And our We and should reaching over Accordingly, efforts to and close, point operator which $XXX of we our plan continued third-party attributable attributable trading the $XXX million. oil correlated is and aware, X/X and X/X from gas

Operator

[Operator first of Leggate comes Research. the line question Instructions] with Doug Our from Wolf

Douglas Leggate

quarter. A lot this

to going One oil X. the So Egypt, X is I'm hit is and guide.

So -- the all, fact Egypt, whatsoever you've you any gas other around than first you pricing. in of obviously haven't the given got price that color better

based $XX guess visibility of least help about the the net I a additional the got sale that has is, one. can on for That's Central flow Basin to So price? it million this? , impact cash think frame costs first clearly, platform. about I rig. my extent on gas How incremental oil you us the not free one of your know, what My second we that you don't current parts, the of do lot moving

the number And is can through just walk to to moving us make just it apples-to-apples acquisition get at an So Apple versus of looking you the on the disposals parts kind leave sure net to basis? I'll Street on there. Strople

John Christmann

questions, back I'll up you Egypt is the historically then country always Egypt we've a Western Yes. Egypt need in step on explored Doug. the oil. Two But where Desert, they let in Obviously, guide. and oil step position good of really to and first gas. Steve and follow we for the in if back come the now can and Permian

We're oil but allocated a would been calculated, you working up showing we've incremental a bring on rig. framework see statement lot income a so it is of X fruit, wells gas of which on know. We've up get our volumes. parity got And to with will on going exploration into not lot is low-hanging to It be wells. position how that a on forward. you as to We've detail in able

back XXXXs. step you ], at and We a always early run well, Caser Western in look back we've Desert, Tcf oil found the the X [ exploration which If is programs.

volumes, a got lot of program in put This potential an incremental we've there's it's will with exploration Egypt of gas on So our program. and tremendous par oil fruit. be on for gas kind low-hanging

Stephen Riney

Yes.

agreement, we've like the part the looks development what the we what EGPC concession. is of as incremental remaining or gas agreed PDP our full life for by So of full volumes mean with the decline

every over curve at produced from any decline gas for from much be was It and look that gas, decline So have a gas It curve quarter, in price. new to doesn't be have how doesn't that new we'll new wells. quarter and the to PDPs, gets fields.

things infield and step-outs can compression gas volume. enhanced like gas volumes, qualify recovery, all bring step-outs, for that, incremental infill, So on gas more

said, X agreed indifferent we drilling agreement, where As we've to oil a as of add drilling it that to an And well. part we're priced well gas rig. economically or John

As we've got on build say, that. There's John already been, have said, we've to resource would got was And no saying, here. I we -- just we've acres of said, million gas-focused as done John just hydrocarbon-rich what exploration.

there's that of a gas-focused believe actually prospectivity. bit we quite some We've So discovered previously got resource.

do of the Some future, a and to maybe And infrastructure appraisal, Infrastructure in for the a investment. the of is but some about in was talk -- we in any bit outage that build-out for about we know, that bit and appraisal place that's infrastructure, need some want of in I Tracy, negotiated. there's need because a ready that today. gas development may might you quite prospectivity gas. lot further don't if that's it extent that still produce is to we price little contemplated There

Tracey Henderson

Steve. Sure,

As our John and we've Steve exploration said, program on oil. focused really

So gas underexplored see significant to oil, is we potential. but relative really

and good the areas gas for And been the more the that We understanding have X geology rocks decades. having source more and a basins are prone of know that are gas the prone. we there

be in have material we gas low-risk of So inventory grow prospects resource over known that with do concepts inventory to to we and volumes. some a continue And testing addition, exploration will time. potential

and see in add great and Egypt. the a a we lot a opportunity So business gas-focused excited and opportunities, to in to inventory grow we're to of potential value those program, it's our have

Stephen Riney

that just question. And point up, to Doug, wrap that

about not this -- we're time the at to in at going Egypt. not their going with just gas do to We're point that specifics we're request. share So agreement price

We'll results. We'll February a we and wanting forecast start flow. plan possibly about in beyond. point flow. get to see understand being understand cash about and we think don't now thinking figure in about We give start free this the what to some means your do able free this for We'll price. a give when up between -- for I cash know final will You to to how help how I show -- XXXX out point.

John Christmann

question, run the plan And if year. Permian rigs, on what next Doug, scaled been X I second We're and running X back. can the to take We've we that's at we've rigs. for oil,

we a to out XX,XXX If side take and which Permian just the sales QX That's on day. numbers, count going you for flat oil that's hold asset maintain are XX%, can barrels in put that about the rig around down we you And subtract our in and that with line upcoming believe XX% that XXX XXX,XXX. that. which with put a down or we is turn you lines of CapEx,

X actually it's next day and you're is at think pretty the We're But can about we oil of rigs. view, year, So as know. strong. at looking for flat in that obviously with U.S. barrels preliminary -- we looking XXX,XXX the hold a this you

Operator

question from James. Freeman Next John is Raymond with

John Freeman

topic, First Sea. on little just the a infill more North bit

just So I to sure understanding. make want that I'm

the I'm spend helpful. just Sea on XX I know the CapEx-wise factoring just over and it North the that in should would XXXX. years. CapEx be the as and would a potentially North in of between next just And said in be sort year, you the of I how ratchet of you in outflow [indiscernible] think about terms So just ARO, Sea these just guess of like out, next of North you color half end capital, that the about -- trying I total minimal capital the AROs, it's down next way When front laid understand the the over spent the being any Sea but years now all in Steve, to several spent then

Stephen Riney

Yes.

won't ARO the So as capital. the show up spend on

reconciliations ARO. the costs GAAP a the Sea in the provide see incurred, supplement, see some in for where our to North actually You'll for versus the the reconciliations non-GAAP in and you'll number a number to we there addition

is equivalent somewhat equivalent considered gap incurred So from or increase kind a of the the a ARO in spending. to GAAP accounting purposes, capital which is costs

years to that patterns. the add to ARO, program dollars So as the when up we little on which as ARO. you just we spend those And in spend capital CapEx John, the in color it doesn't or spending shows give incur capital a the it up the maybe in bit show more

obligation said, there's XX% the our there's as there's were I that a tax X gross tax dollar deferred a on a you you a if -- on numbers balance So because every spend on ARO. because the there's then side savings asset combine sheet, liability to for and

numbers roughly million being a numbers will So the there's $XXX liability. lot quickly, said, with tax the spent that $X pretty billion $X.X billion. now on and you of be $X.X And X billion, about of out X abandonment. It's of of could it's our net I It's that asset on tax about XXXX. Those probably between balance sheet. XX% XX% figure -- rate, an wellbore balance that sheet. spent is on as end A to

out you about figure say would through okay, is that's And figure so for the X you time. period -- $XXX I what year of And the years. a pattern million grows

than $XXX to starts XXXX, in of a kind in little it's less ramping bit way 'XX. So be million next up going year

The above a years million year. $XXX the years a year, $XXX are below X are X first last million

John Freeman

of or decline are you moving driver XX% a drivers, just perfect. next I of parts sort that. on decline. Permian that and the a to about. decline way kind account there's then just synergies, with Is any idea And big of think you noncore a year, you the the of like all appreciate which That's volumes. maybe like curtailed the magnitude some of there from of of just pretty those rough a give the divestitures XX% color lot ballpark, each year-over-year, And way indicating to mentioned LOE, the on obviously all

John Christmann

the a John, comes much, a synergies in a change in year the stand-alone costs, that which Yes. to look is do that just out. that to into we've at but is going out, next big water. break on up. Callon made we business a typically what lot higher much assets the the roll higher really Basin cost, it that chunk lot the Central we've are able thought how changes is you're mean I the selling portfolio waterflood on about and we the side been the declining handle haven't just Obviously, and of mean, as to U.S. everything of tried I of we've to platform, drive

So a it's on at can Permian this unconventional than our And of we're hard to I recharacterization laid more -- tell we've you're is really business Basin going to out what there's do how what you, also see. working point.

Stephen Riney

Yes. And year the and I'd there the And just capital of always give direction to volume production it. in the we add, to in is in else, X that John, it's the February. the shape meat this more of elements the chart we'll detail provide of quite multiple of the just kind a that -- plan at what means in than around detailed kind a got what we're in But anything firm. that program out do to supplement. try bit What when trying point more time we roll to

to give you sometime Gary some the want might he and or today might that. take to a through it of be take You behind just able details -- call later

Operator

comes Research. line Bob Our next Bernstein with question of Brackett the from

Bob Brackett

Should anything cash in the question as of timing. I that that cash a free the kind getting your a think cadence strategy XQ bit. and disposals cash big There's and else? of had return a and around part flow versus moving of return came timing the door percent of around down I the

John Christmann

the We year. works then of into out timing things general, being We're running But the definitely, kind times. our a look ahead. in timing, And of get of little were from had that at at Bob. just mean, it's that it's the able we've in QX, material more was just came a yes, sometimes lot market bit can you in prevent to that control. I you

Bob Brackett

Permian, in hear and and thoughts Matterhorn of that out takeaway clear. expectation And the what's but it's some curtailment improve, follow-up on the slow, get that will latest Is the coming. that's your quick on feels that ends? basin? when intelligence around latest your the Very A are ground you your we'll realizations gas curtailment happening Matterhorn.

Stephen Riney

to think to activity, Permian Coast. right I to out if of completed I so. related Matterhorn, most but and the them today. Yes. Those of them week I related that's price or the extremes, believe are call Gulf on we coming the other are you that be the to downtime to not the some want pipelines maintenance next see believe, in extremes impacting is -- And pricing as that planned now

think of is just days month I first So was this of perhaps days matter a ago, a of couple December $X.XX. for

a least or not great price, $X $X.XX. better So than negative at but

Operator

with question Roger comes Securities. from next of Our the line Read Wells Fargo

Roger Read

But and I understand guess the in a I'd think G&A, of addition obviously of driving like piece way I lot it's looks these the to opportunities. is the to wanted what synergy what the to LOE, laid some come so, a would it you back cost. that? here. just the I out anticipated I from the Or mean mean Callon on lowering an merger? given of of but I was is that

John Christmann

side, the of but it's business the Roger, think, it's clearly Callon I synergies sales. on asset simplification with on our also the some

Stephen Riney

around just add, transaction, a the that in million year. $XXX G&A related to would I we said Callon million of around thing that other the and synergies G&A $XX cost be would And our Yes. Callon structure a had of around

Callon basically right were G&A now flat Our prior acquisition. with to where is the we running

G&A Callon have were basically XXXX costs think well. actually people but in some in around to I of we all thought, the synergies not that it's growing a number company, equivalently Callon amount some we the the around one-off synergies exceeding be just we've of G&A of the here eliminated G&A. There So because in we transaction as the the Callon -- or increasing full people -- are going

Roger Read

preelection. all had you Yes. got appreciate decisions the those then, question No, to Alaska well. And exploration made And John, my obviously, I be since that. for you

of in outlook, regulatory looks do Alaska how just you're that. business point, certainly, In federal easier at to the terms it looking with at wondering this government

about as bad well, Assume particular Alaska or this overall with you but think the good opportunity.

John Christmann

Yes.

remind you, I'll Roger, is I our XXX,XXX got in lands. position, main acres thing it's about there, think the state but we've

in fairly a we're land. pipeline, so and where we're to position you're close state And

don't few but things. the in you So bring federal really have just to on side a

about excited good So We X well did We're back we're that. we winter, we the very we're to going that the And about had but feel last X of Alaska. down. earlier this get about a that excited we year attempted discovery on it.

will winter. and roads some and capital year this ice we be stuff it spud, next have start when early, for So early to we added building

Roger Read

Appreciate I that. X sometimes more enough. But federal roadblock than is

on just check that. wanted I to So

John Christmann

Thanks.

Operator

comes Paul that from Cheng line with the question Scotiabank. next Our of

Paul Cheng

you guys better them when deal, doing even that found But probably than that have better go John, probably they're done the saying us? actually done Apache think there's you where worst? you through the I than they anything that learned though And Callon have from you that, Callon. do

John Christmann

when and both I Paul, you X replicate. you integrate try Yes. from mean, obviously, good to companies, take

anxious Basin. think in cut million our been they've lot had well. acreage And good results think $X per on of we've us X. get digging then their you've excited seeing Obviously, terms X got or assumptions almost got I we're now, got a and Midland that spacing, And I as just back pretty X well. on that some some some wells the into technical on and in some seen processes. actually those costs we've the after chain we're supply But Callon organization. integrated general, from good side, pretty to uplift of good well we've X, be cut our cost to able into of well but the people flowing the as good we're in We've we've

we're general. So Callon excited in pretty about

Paul Cheng

or then from process able be No, a and that that. they that there or enhance Is to their asking I technology actually that process can you are well, adopt doing will was operations? find technology anything you and just your

John Christmann

Yes. I and the versus into would it were we how we think take data a on the to were mean, that is we're spacing side, looking do they we say the I development modify what how and -- how answer. how and scenarios, designed how better approaching you hard they

Stephen Riney

and okay, earlier do was that we're figured fracking and was do idea that. really acreage have just to I to That's step it'd everything way assuming, of always Apache and in of zones, Yes. And it good going just into think, simple we say think that communication, what's be the and in going we're Instead, else. process add right, communication. got do back I aspects well, just I if the to not we've bring just what to what's everything well, out, all spacing any landing to and they a exactly it's and could

believe we think step it's take there worth fundamental well, to doing we're good and And opportunity what question just and I So that. as our the and it's beliefs to back doing.

to come worth conclusions But in course. will those We asking it's questions. some ourselves due

Paul Cheng

not I benefit? original the Steve, quantify is what's can those assume Because you in target? synergy your

Stephen Riney

we'll the can't of due I'd this point, benefits course. I say At do quantify that. No. in But that

the whichever you the with like will learned Callon, that recap synergies we back to our will we've will meaningful $XXX acreage things of believe think as type some call in how think that I point million more And the some are just completed there. -- drilled, online helps wells in And And sometime the have about the approach got some in have synergies, talked want to that we've where are the at in or in around rest I operational capital and with overhead get and -- we past, we'll the and we even synergies included, think that past, to annual operating from we do said productivity XXXX, the that we've come it a include get include cost and of time history XXXX capital cash there it. those. we've of combination to Apache efficiency, but well. we

Paul Cheng

Okay.

a Alaska. total John, The back or going that second us on targeting last question guys tell prospect? you that new going back? essentially to just And that you is wells that guys year to program, you suspend and in same are going X the you you can are you're redo

John Christmann

No, going actually prospect. back Paul, it's the to Saki

Operator

gentlemen. [Technical by, ladies have some Difficulty] stand by, technical Please Please audio we and stand difficulties.

you for X you. moment, standing by. standing and Yes, to Ladies thank Thank may gentlemen. you Thank continuing continue, please. And are you for live. by you

John Christmann

disconnect, we're an up. We but I internet apologize. back. back We're had

So.

Operator

line Dingmann from with call Truist. of is Neal Our next the

Neal Dingmann

the that, you wondering, My question, Permian rigs. for specifically, just is maybe X target talked plan to -- and production, all maintain. I'm XX, again, around kind Egyptian the just next you Egypt about of Permian

of just to think flat And of about should those You I'm both So either to that's about appropriate maintaining think production. in areas. production sort to production. base maintain in get we trying much stable it I'm comes how wondering a when the that Has sense changed area?

John Christmann

Right I in you has earlier program Permian in Yes. We've the reported gross side -- XX XX, to oil Egypt, is if the look design X that but program, at now, is sustain oil Neal, it's to oil, the it's Egypt, question. then really first we're coming been got the look around that slightly XXX there. you've production a the Doug's slightly XX. close. mentioned in with designed the got early gas XX we've rigs, And with our down but on At underinvesting what to

Stephen Riney

add can we I with with as rigs. when Yes. point day. if we We year went at year the back at the time. oil know, the -- that said the to slightly -- first XX barrels If a just just year. was we you quarter in decline down go briefly. gross look volume would we We people XX. with Well, XX as that through one I mean year XXX,XXX drilling the started to ended started

quarter quarter, XXX,XXX. it third XXX,XXX. was In Second was

and aspect the and into on change a in on I mid-XXXs running and quarter some volume to fourth But just struggling from slight were production a XX that. I there. we're with to the slight go think the in would time, rigs that, we that's continue drilling that probably kind to into people absent if for back XXXX, of it So grow going activity. decline. maintain that's we XXXX, of quite were to emphasize or

achieved really few smooth a a -- cadence that's operational nice, commented very times, we've working actually of rigs, kind we've with we've as XX So well.

We have wells, is increased is be rig that that gas-focused to appraised. XX. and The those thing I drilling some would XXXX will say of XXth the about

Some there are will for they will be low-risk looking -- we will better be them out step appraisal of bigger, which development there. be believe are some some of exploration, wells, outs, prospects, type

at this gas, point so the believe in for We the unknown. but there's prospectivity, potential And optimistic. certainly potential would good time. I We're is is say, unknown still bit a

do I production too that The be management, I that plans what think would we've last, doing other trying learned like the say we waterflood potential to And be is the got our country we've on we've we a a focus decline around in last of not for best many can decline, mitigate a XXXX volumes improving about I the -- X.X years, on that is in have and a would in say, lot see thing the can lot that. wells. really to to maintain basis, Egypt for yet on way to in to mitigation what drill working

slight of we're a see both on this pattern with on decline. of working is XXXX, just equal kind everything continue But So what fronts, just we'll probably rings. and XXXX if we'll

Neal Dingmann

here, other with that bit pretty where in just Got I this in pricing but the stock it. wondering very been is And coming about you mean, opportunistic given has periods today, cards? talked I'm then return, aggressively. in gotten just potentially just shareholder you've have a second, the already guys recent

John Christmann

think clearly, going reduction of our coming that we're paid think We've asset as got in but majority the go debt also time is as that sales. do share The we've is we attractive. price working We're to to periods Neal, well. And to got fastest. I down get the from debt running proceeds obviously ahead

Operator

from of with Jayaram the Arun next Our comes question JPMorgan. line

Arun Jayaram

PDP back help up, what wedge the I could that price and make gas decline volumes like wondering with call incremental PDP to where over Steve, go gas. about get think to [ if you and you higher field obviously wanted you in can the looks Egypt Caser Egypt was that the I mentioned time us it, ] in rate gas you for specifically? the

John Christmann

[ We've the lot a Caser's take I'll wells. the concert lot Arun, of with but that big also stages portion It compression. gas on is decline. a of Yes, gone is through other we casing head some gas oil of of one. our produce been ]

So see to could volumes opportunity cost has in some with been we'll obviously, think pretty be we got decline, incremental material. we've the digits double the the gas have but add I fill program overall can to And that new an there.

Arun Jayaram

are terms the in John, a that kind Suriname of the XXXX, of life with thinking a Understood. North maybe terms now obviously, you field. cycle then follow-up. Understood. And Sea the then up in And stage another starting another the thinking just cycle how you leg North of late how development in of of stool? stool in thinking to at, broader about recently. Sea about some And you But obviously, sold about portfolio, the obviously, the are just portfolio? to the the where adding leg given assets it's

John Christmann

X material. and step can believe think think Egypt Yes. reshaped Permian 'XX of running if both in hold for you strong start the We of we asset. in be a unconventional are Egypt now business. future. of or back, the lot large legs room kind X will I over very mean, long-term I with Suriname Permian that very and we we've at We've We our stool reworked really what a count got rig there foreseeable is a been come will decades. for on to well. efficient see as flat

back at to step the put we some going 'XX, X you that, those pretty growth just and if onshore and maintain relative assets. positions. nice to so look in X And large Suriname's

really mean coming what to and the a nice to in always in in Suriname think and improve both be stepping add with XXXX, it. positions, on it's I to portfolio is think pretty So we've in good looking the how U.S. core got are I Permian shape. nice X we and going But I Egypt. We're

Arun Jayaram

exploration Understood. near... Plus in Alaska the

John Christmann

small we've Arun, the there, is budget think of stayed Absolutely. portion And I our exploration. spending in been a key We've committed.

XX I said prepared remarks, in think perfect the and that. staff. we've with you got successful real as And shareholder Suriname a exploration, example of is I can value a Block add wonderful

assets core little our cash So know and driving we've real our a We'll it. and our bit. excited make nice flow also got from in money is we where continue about fund Permian We're we But portfolio. to Egypt. free a

Operator

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

Charles Meade

of include Suriname, decided about when I mockup cartoons -- always But Slide and question -- sense you in a ask and of that kind supplement your development able what -- see they of this to this, give on so won't guys people to what slide wanted really on you these away side I right put the be a XX, like I do layout. the this? And about to they what the when what's the from take numbers you hope when you get GranMorgu? what are you besides this slide, the the

John Christmann

volumes today, just a we've real I So I to right? visibility project Well, it's got I now XXXX. think given in it's mean, -- mean

the that you so you put some out that think why bring life. there And it's I we to put time slides picture out there. And it that's

You this looking of can see from in. deepwater is kind

the where will FPSO total a is be see slide. This You'll placed.

as it's prospects Sapakara, appraised field. more [indiscernible], terms And potential You be would with of see as talked there a about a we've fairway along say the exploration in that well. and there. development it's of looking fair will way, thing opportunities that over I is we've the also tiebacks at more

material. about. it's because large. just It's real excited to and we're forward life think But it's bringing this we're today, looking it's something XXXX. So to project It's I

Operator

ROTH. with One Mariani Leo comes moment from for of our next question that the line

Leo Mariani

It guys to at wanted in there. pulling of roughly Just a Oil of are back like plan about the XX. sounds kind U.S. kind activity little basically inquire the bit is you

You softer guys oil outlook. are kind of citing a

expecting Just oil bought kind obviously, next to you be year? of you of just kind curious, Callon the asset. mean, prices lower are I

you the year? sort a kind we little as on you're growth a pull provide combined quarters and of to roll back. basis, You organic bit last just more there now into some color pretty saw choosing of couple thinking next Can nice of the on

John Christmann

rigs we just we're we're going X to I got pick rigs. in with sustained up be base to softer it is, and volumes Permian can work roughly It's those if sustain XXXX, on the environment. nice a like moving We're always said, easy think can up. price Leo, think to We've an that And Yes. like I a asset Egypt. with good place But we feels I initially. where thing into sustain efficiencies.

the next from overall in got -- XXXX corporate You've Suriname an level. coming

Leo Mariani

jumping just Egypt maybe over then And to here. Okay.

gross So you sort Egyptian adjusted I call that to very know but comment guys relatively production the you're or flat. of that expecting on expect lines we I modest could keep you oil, on on some there kind made think of net a see oil,

for rig out, get towards maybe also on production of next quickly. Can in got the as your there next a prices you're slightly for start year? just or could address higher to year? going. for oil. year. share gas I that that expecting the in the the kind if And second in maybe we that PSCs gas year to in Egypt lower Egypt expectations any to of end then of growth Do hoping see expectation next So don't flatten related get What's just gas know the half? I you on you Egypt that's you was Gas,

John Christmann

It's just as say, line. Steve very, in the you XX -- over quarters. if at I'd we've Yes. mentioned, last top been at rigs, Egypt very declining look X slight the been we slightly

on the probably the are waterflood where gross as some So side. have oil is benefit those flatten actually getting decline. of the at your about we We're XX, after projects it's which they well,

-- get nice is overall a infrastructure. we've volumes our that strong we'll you declining. to and we laid the to some with the we'll out program, prospects waterflood get new -- prospects drill some got it's then quick X-rig gross program, then program on And then So side, bigger that. see. then can with this and after on and got But We'll to we've and then bring can gas improve gas

scale there better the we a in get I think the that. on getting down, side we're So key we'll future. started prospects with gas And of have is some after clue the

Operator

Betty Barclays. of next line Jiang comes Our with question from the

Wei Jiang

I to Sea North ARO conversation. go to back want the

present billion basis. think the I $X.X is on So a value

absolute any about tax And give year. think the flow outflow returns as this, cash to could if the we the think outflow you as free calculation related think basis. total for I this an you on the given liability in about cash wondering include So capacity does your

Stephen Riney

Yes.

give third So give I've I'll number as you -- a you you X I'll given numbers. well. already

all prescribed the given discount U.S. today. sheet. X are assets we if our take numbers of inflation rates. about then balance as So Again, had I've cost we we at liability think that We back discount requires that them we've future on that inflate of the of we what got current billion and $X is into abandoning a those GAAP and to abandon the that

that you and is you Today the got them billion. take billion. discount cost $X when then we've estimate $X.X them get cost today, -- inflate So back,

we is rate borrowing discount So inflation obviously, have for our that the lower that, use to which is the than rate rate.

of benefit of For benefit frame. $XXX present that time value XX-year million. that XX Then tax that. is all the to of The tax there's

after-tax that's What So net to asset. on was the the value the $X.X second present liability, billion which sheet. $X a sheet question? offsetting liability balance part Two million $X billion billion getting on present the net, numbers tax value is of $XXX our balance today. deferred different the

Wei Jiang

calculation, cash this flow gets that? the related of outflow cash organic flow think cash to the when is return, on cash Just free does about netted free out you

Stephen Riney

costs lot ahead -- the let's kind just associated we that's think focused with talked will. on talked and a and activity and And us abandonment understand I and the just Yes, remember a of we've it I of lot, that. why

flow continue costs a for after several XX% cash we generate us help still Let's tax assets in even flow here operating Sea. just forget a lot the in pay next that North free those -- will of that And to free have not rate. the cash those Those years.

Wei Jiang

This the is under as on above year benefit gas environment. continue to you features, of marketing with Can you powerful a normal gas current My would how to surprised benefit flavor the on able us the spread, Understood. capture the give next follow-up Waha piece. in price be on side gas a weak marketing really well? year, Waha marketing

Stephen Riney

there's a between a Yes, a be prices to take us versus weekend, extremely gas volatile. be next a not we Gulf we $X, there's is, Waha differential -- if on the find price, cost can normally as Waha like if And Coast X it's over we're Coast. it much Even happens less as a lot Coast on people take they here our XXX as to transport the we on weekend, a it what $X.XX as I numbers, Gulf a making a million that volatile figure buy day transport, prices. for are we've negative Gulf Gulf on And to are that for and to that's costs, days year. negative fairly go spread, It's like what the probably those of transport means If could experienced spreads X the and use which it's simple. $X, you're over positive fake Waha. then just which cubic you then disclose, for but going absolutely transport can short transport negative can't purchasing $X would and we to and Waha can periods at we to and XXXX, on out little it and pricing when there's gas $X.XX get or time, what nearly the depend cost weekend, in feet a depend if really Coast than paying dollar sell through will you what all on for -- go for with XXXX, we for

Wei Jiang

pipeline to now. It's that right have certainly nice

benchmark at Coast share, hubs? Gulf looking you a different or of the clarify, to Just it's Houston combination are

John Christmann

depending it to. pipe be back takes on It's the would -- ship channel Yes. where or looking at mainly you

Operator

comes TPH Company. with from Jeoffrey last Our question Lambujon &

Jeoffrey Lambujon

commentary Can understand North ago, free you just couple Really also quick the a help A just you your around mentioned. flow the cash of the your outlook generation to as that the dominate through. us is what Sea. production of for follow-up dynamic on OpEx us just walked you declines help it will already along or with ARO in asset that next kind from that questions year,

Stephen Riney

not into -- -- We're we on say, the at in we point of go give more normally time, that like And price the to volumes we've that, this we're production the view detail time outlook. oil in just at dominated the company. year, direction a and with this probably program this call. of We'll February by general Yes. overall capital generally the highlighted as longer-term is conversation and

the to items the situation and and accomplish business specifics, We'll we now. November capital though, the LOE really that call. we because February. around North about all between the operations I that investment it in, that's any Sea look give talk can more line capital of of type typically and on you, revenues is of breakdown the day-to-day country-by-country in We things we're under So current for tell situation. and that like North details the and Sea, in managing operations -- free cash openly not now -- we're economic flow the in practically

for puts the just costs, on safety costs. spending at make the environment we're stuff operating asset. will hard or human of the never could cash and examined environment, manage sacrifices or but we free at a operating of in And that do We be for cash either so we where to way are at there's that free that spend life sure hard so flow focused and in and that we're properly an we on lot looking flow, we at risk, look money that just looked remaining a

February detail we'll into the that more So get call. in of

Operator

session it remarks. close turn for Q&A will I John today to the that, and closing with our And back Christmann, for CEO,

John Christmann

the at first Yes. to we the performing great Thank as we've disconnect high made during want we've assets question. very, for on a Internet in progress I closing, are of and Paul's all, outlined, you. that portfolio, had apologize level. And very But the

time Permian significantly position. our and to have now streamlined clear production We're Suriname. gas have and significant a adding very in flow line valuable in potentially and scaled We unconventional program Egypt cash a

and business, price at potentially We Going and costs at capital free Permian broadly are the X and look sustaining early provided sustain oil XX flow. should in we into on rigs are which volumes of reduced plan reducing generating focused our levels. softer looking environment a rigs a an oil core XXXX, at Egypt, cash in

plan work Thank you this to for forward We joining lot to details. to more back with look will you in and coming a February us. continue

Operator

conference. we that, in with ladies thank and today's And gentlemen, for participating you

disconnect. now may You

APA (APA) 7 Nov 242024 Q3 Earnings call transcript