RRC - Earnings call transcript Q4 2018 | Range Resources Corporation

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Operator

Welcome to the Range Resources Fourth Quarter and Year-End 2018 Earnings Conference Call. [Operator Instructions]. Statements made during this conference call that are not historical facts are forward-looking statements. Such statements are subject to risks and uncertainties, which could cause actual results to differ materially from those in the forward-looking statements. [Operator Instructions]. would turn I to call time, Mr. this like the to over At President, Range Relations Sando, Investor Laith Vice at Resources. Please go ahead, sir.

Laith Sando

this Thank thank you Mark call. morning, Dennis Degner, everyone, Range's Executive Operations; Ventura, Good today's earnings and release our Officer. presentation slides of that investor Jeff on The Financial a website. you, Chief year-end speakers of updated be morning. you've Scucchi, some chance Officer; to posted are on Chief SVP and had for Hopefully, Operator. review We'll joining referencing the press we've call and those

with We certain also can filed SEC non-GAAP call. measures system. Please available our the EDGAR or SEC's XX-K on under our on you today's Investors note the tab the website that referencing It's be using it access yesterday. we'll

of release these the most press figures. provides to comparable GAAP Our reconciliations

turn additional website our that, cash and tables other information, non-GAAP of Jeff. to assist me call supplemental we've With EBITDAX, For the calculation margins the on measures. over to posted in let

Jeffrey Ventura

Thanks, Laith, joining us thanks earnings for this morning's on call. to and everyone

makes We given it in their and is E&P result. discipline their believe direction have a $XX drilling the stage originally make safely the capital clear leverage companies, from industry, this at to Range and continue flow, objectives, on our and request free key of many budgeted. plans development. the for strategic completing Investors for XXXX as XXXX, most have back fourth generating for companies' reducing than E&P of moderated spending quarter and organic for Looking sense million progress less right cash program companies been

which will, natural X.X largest is the take capture in to gone a to than time, in country, gas a if what greatest more conditioning The you is laterals, is allows that particularly long increasingly evidenced pads our can not in core for be Southwest as broader progression for our in this flow position is has free concept and production, in existing million Pennsylvania, water. in commonwealth. source can the recycle going phase trying companies Range's this around and conditioning peer-leading has top-tier the costs. the phase XXXX and development Range's capacity the operating allows and development, next and to forward as of differentials market shale E&P is seeing what transportation products come targeting. In area, Range markets in-basin various certainly is cash demand yields to with U.S. compete we move contemplated more both in XXXX, complete. Range efficiencies thing That if if predictable projects of for held longer Pennsylvania. natural and sizable from and And now results efficient we our cracker also being This position are abroad. you're and processing is field like operational which for a place the like phase, These exciting in now that's expect which acreage and draw throughout utilize acres largely gas world. a acreage are to with Range, by power in Range Marcellus we year-end Range For as the up will us and operations the projects effectively NGLs. that returns for block for

and commitment also XXXX, We the means operations communicated beginning our at at expect When capital both. Range only I $XX not we capital about but Against discipline, a beyond. spend budgets we to yields I broader increase the is the this can't continued think can you competitive some of peers say set efficient, that do am how XXXX, their backdrop, of discipline spreadsheet and arbitrated budget. below the the coming example budget majority discipline capital team's flow of Range in mid-year can their talk did sector. capital companies or back enough some that either in In capital a investment future how to their a cash to from not disciplined in year to most spending within as and sticking and investors allow We price. plans plans. also to safe with company XXXX in recognize what of investors. did capital for pleased from original commitment million companies dollars our and In E&Ps meeting the to base more can expect cases, than it's overwhelming our those simply outspent that bring the This

billion, in continued positive and core as the assets currently and outstanding $XX solid cost per nearly The Marcellus equity. billion revisions. our Looking value reserves continues performance reserves of debt Range's another value which improvements quality The Range's resource. gains, targeting team the to see the reserve XXXX, out back additions. resource developing optimized backing were XXXX to share, and underlying efficiency revisions After $XX of the completions deliver $X.XX track the productivity PV-XX only Proved XXXX. extending and XX% was long for for year job a year-end from laterals further result positive to in terms speaks Mcfe. an using on The drove of equates our future of to balance per evidenced our finding was $X.X increased year-end this of do at which we its of disconnect of drove pricing in of strip record by

approach SEC X,XXX to approximately delivering our in This measured we've class-leading assets for of foundation ultimately our will strip today's prices. core for above have of undrilled addition next that Range but natural for higher Many WTI provides prices plans of a for serves available five has the today. based at their that current conservative next flow on go-forward inventory what sustainable prices additional peers strip $XX capable possible Range approximates $X.XX which trade development, commodity pricing what our Marcellus are proved showing years. cash relatively gas years only the are wells. MMBtu today's of and decades five free a prices, than at agree per In We account which taken for reserves,

prices updated low sheet shareholders. other Unlike shown expiring current As of a agreements capital in allocation investors that have to and Range near-term not our hinted consistently This at cash returning transportation excess although cash supports was approach a below only drive free remain cash growth us entering base of a flow. towards low deliver for capital we and Range's at This maintenance over that committed the some decline balanced corporate or our requirements. maintenance $XXX peers do growth Range's capital underpinned to allocation is continued the with presentation, prices, and capital modest over free Range next generating growth at XX%. towards forces today's Range above would equals from in competitive strip its base free plan outsized with provides cash years flow To midstream that and balance higher XXXX by billion returns, low asset prices, approach favor have strip our sustainable decline at cash of to risk balanced component, the extent capable free at base the of capital pricing margins is million. five improvement to nearly years. will today's next higher at of pricing. the ability decline acreage annual five year generating free improve market the that strength outlook, flow simply XX% will than $X levels, five sales This timeline over cumulative organic the have of accelerate these over cap. we or more

For capital that in Range this believe unique is growth $XXX sheet, Dennis years, that Marcellus allocation only to beyond it return plan bolster differentiator which a level balance starting for really will free a process that cash maintenance the inventories. additional their to fourth and will see continue we're five in used our market now the in returned will vast detail. other million exhausting can capital flat, this in but invest and high as five far point is over we core a over our our to for given into high-quality that the to inventory on or inventory shareholders. of Mark turn capital, And flow to cash quarter operations. completion beyond Dennis be cover drilling low not more of be can the hold we our We capital-efficient believe Range next position production and locations, year I'll outlook companies program discuss flow deliver

Dennis Degner

the XX% mid-continent quarter interest to year-over-year of Jeff. feet includes sale an X,XXX sale the This number fourth and that impact both the the you, in growth per year. was XXXX production annual Production and came the during million approximately contributed day. cubic Thank equivalent at override asset for

quarter January. which Throughout with the fourth XX was week facility Bcf have month production repairs of facility. MarkWest disclosed, during an unfortunate ensuing majority Southwest were resulting Range's during materially in of by for to Pennsylvania volumes of occurred quarter, the completed in Repairs made, the processing first reduction the been could the outage, equivalent incident an previously necessary curtailed MarkWest restored December. while be the approximate impacted production Houston As full at since operations

more go but the or in the a to that the plan below takeaway below of million. below year, capital guidance mentioned, of budget. I'll $XXX original We spending led spending spend and dedication to team's exception. some into Jeff last board of that set capital on We're of this at for the million led expect at $XX in the a came simple: our details our safe, rule, capital As beginning XXXX to operations not in is minute, achievements the efficient proud spending the budget resulting total be discipline

forward, As to we $XXX Appalachian-Marcellus Louisiana. with at allocated the and capital XX% budget to is look set XX% our North million, program XXXX

our number flow. drilling directed per and pipeline of approximately improve will efficiency expected generate including the capital up growth to to are contribution, over this to sales increase last consist this Average similar lengths will horizontal production to well X during to XX of original to existing from the lengths to turn-in-lines feet, projected expect first growth taking excess footage wells of wells $XXX of projected in pushing the line and well The the XX% sales fewer compared We XXXX first year. to XXXX, extending budget increase in drilled Appalachia, the being maximize sales with to activity. the while increase given year-over-year year. were focused with path to XXXX wells budgeted the this Similar of with for of production our turn-in-line completions, to wells into discussion laterals comprise quarter. than wells and an in be this throughout impact lateral for In prior the best averaging targets approximately to capital our and setting were XX plan turned slight of feet a be are illustrated production. turned on within XX% for the weighted year's XX,XXX the average capital planned year-over-year a XXXX and year. in lateral in of XX facilities million pad to will feet, up completion expected while of sites We program of with first the XXXX, that to and of And year of half during on sales five operationally X year is with with fourth the the structure cash respectively. is lengths turned to Similar we see which charge to sales year, deliver liquids-rich lower production in to X,XXX production. was lastly, Appalachian team be the picks, capital turn-in-line QX turned to slightly turn-in-lines. Honing infrastructure, to our will spending unit spent North liquids total longer feet, The well increase in XX% of We XX% fourth call, capital XX,XXX per lateral year. throughout quarter, one quarter year last efficiencies. design generating and expected X%, completed the In quarter along wells acreage, wells remained the total these drivers the budget. the the we the XX% the any early drill and Louisiana, aim XXXX, on with outlook. towards the to is to free to X,XXX the team's wells the earmarked the In completed and liquids approximately us approximately on a and evaluate sequential being In straightforward: helps the ahead North Louisiana Marcellus

we've year, design. need area and early average The the of assist understanding to the for from on in benefits an overall the the be test with from the be in increased completion year, back they but part on will have forward. in Looking not structural our where expectations enhanced influence last competitive line production of determining structural key as evaluating team aspects is Valley and seen wells asset's When will latest Cotton the spaces. XXXX the return direction going the the our

able in lower back theme ability Range of the for the a drill let's laterals X% some Now feet. our average resulting to to per XXXX drilling underspend. on our well longest to at drilling year the A while with date. the Along the was team XXXX key achievements the the look laterals foot. basin's capital cost of top increase drilled The was drove in length key long Pennsylvania Marcellus, that three more XX,XXX in for in by longest lateral Marcellus Southwest

And are Water to and overall footage continues drilled our addition efficiency the feet, drilling we XXXX. lateral drilling capital recycling drilling component our the team able efficiencies beyond per continue operations rig play by able XX,XXX our a capital these increase successfully also improving looking as to as when along also wells has by much to In team improve. XX per longest drilled XX%, efficiency. was XX% a been drilling foot gains, to The laterals, with cost water extended of recycling stage our significant saw program acreage for by versus to in at in underspend reduced per key And of capital our during in with reduce corporate Southwest they resulting XX%, contiguous program, in the examples water, These position, XXX% our and a taking costs largest our efforts, year. strongly By in drivers one Range's team role of creative high-quality our team's and Mcfe underspend. the the the water played large efficiency. with LOE where in was PA, exception. have by XXXX achieving no of per the combined role impacted the two just third-party asset $X.XX

transportation, of The in additional outlets Midwest On side, quarter the marketing plant, to first where Transfer's which contracted Coast natural fourth as project full marked Energy Gulf the MarkWest's quarter access its the also Rover the full all and quarter Range early September. commissioning saw capacity provided Harmon gas had December. processing in to of Creek X reached

prior XXXX, QX on natural our available was utilization processing best gas has this addition the Appalachia. this infrastructure. were $X.XX discussed we of allowing As plant, fourth of fourth quarter to to quarter the part wells NYMEX new in newly call, large out of of seen the maximize acreage liquids-rich near under differential focused us Range since differential transportation in The due

timeframe, various to to keep enabling a capital have Range's incremental transport Appalachia improved gas perfectly production Gulf XXXX long we're shortly to significant is it seems forward, revised gas our date. be beneficial trajectory strategy been continue and Range's local firm have project transport Appalachia. of the gas reduced production transportation gas which to and in-basin portfolio, going commitments production with original delays overall, with XXXX profile. Compared up but and corresponding built creating built a basis. realize each To has infrastructure been diversified market Midwest, the improved full structure. natural the plans, time utilize and cost have been of pricing ended fully markets, early natural to of exposure, our to sell of pipeline we Southwest Range Going to to able inclusive that its environment to Coast its to in-service has in basin in market spend, after the coming XXXX It and natural back a but out managing as expects the end, Southeast, to on years current the expected few part took aligning

with on side Belvieu the XXXX. the since price Range the Mariner of the capacity as has exporting to markets to the East of capture index Sunoco's Mont producer majority On able been only its to early propane premiums propane marketing, liquid international I, by

over majority winter its total, summer markets months. the being Range company via the during majority addition, volumes butane propane locally XX% In of volumes to remaining of sent Hook corporate of normal same the quarter. those the production NGL for export rail. during The its sold and are In each Marcus local

to in-basin outlets during our stability As we especially when to NGL price, are production beneficial develop is for the providing NGL acreage, additional low. continue in liquids demand summer

purity over exposure we believe could be added the that warranted. international additional coming to NGL Belvieu the volumes are Mont supplied Given to prices years,

capacity and a XX,XXX April East result, XXXX. taken for a on butane Mariner day Range in per barrels As combined X propane has of starting

Importantly, with go-forward in-basin we to the fill of the pipeline, January, that have today, I the appearance East incremental pipeline propane In and to ability sell butane produce a access volumes basis. capacity flexibility Mariner lost leaving we subsidence following route. on a capacity NGLs on the along we to

of a moving available East the Mariner utilizing on we continue outage, propane Marcus terminal. to X Hook to result are capacity the As

sell marketing natural have options including For gas. to ability for production, the multiple ethane ethane, we as

X,XXX delayed day have as reduced restart While production not East of reflect million quarter production feet estimated cubic the per materially altering first Mariner corporate result, Range's cash of and And MarkWest volumes. the a equivalent flows, the plants outage guidance impact.

to to continue production deliver this: our now out cost-effective it we proud on wells. excited the most and extremely as turn Mark Mark, for operationally budget the what's Before and efficient financials. and are I'll capital I'll produce over of the Mark? team's with to XXXX while discuss in about accomplishments we targets to We're handing over drill XXXX, close in-store and our

Mark Scucchi

and from of of Thank and operations assets, driven and of was described, you, flow The $XXX sales, to by below cash Dennis full fourth $XXX million and XXXX our transition debt results like compares was quarter quality flow X.Xx full prices year-end the cash accomplishments million discipline. XXXX flow budget from Dennis. key X.Xx leverage achieve in operations reduce capital execution I the $XX operational the at for asset in our absolute cost peers. XXXX. and would with production. rising $XXX year-end of The a from Results year the on improving which point Range the capital efficiency million reduce able the to XXXX us for to free XXXX, just Again, at increase commitment apart year allowed cash Range two strong that controls, to demonstrated by spending, budget. to sets combined to Range Range's million million, company's $XXX year-over-year midyear out Driven to XXXX

generating These our taken return we also And results projects First, result under strategic began highest capital and are charges noncash impairment program XXXX on properties. in rightsizing flow. flow. generate free we a against cash cash and budget. goodwill focus of include free the unproved second, came our charges to

As in related described allocated fourth originally price The assessment conclude unproved area the the North quarter impairments properties. fourth in taken a the $X.X late goodwill outside that year rules, GAAP were property $XXX Range's billion for triggered was Louisiana. in The million North noncash unproved to that quantitative stock last for of decline and to goodwill certain XX-K, under fully impairment in value quarter impaired. Terryville and evaluation extension Louisiana

had strong substantial, The were the is we allocation of we capital a returns locations of these stringent develop properties. intent Range drilling our portfolio. for capital potential longer and these part determined in As competition dropped elsewhere the as result no to process, within

beyond, framework near As the we allocate for value Range capital XXXX and look and to long-term paramount forward the can which we generate. is the understanding in business

economic and impact shareholders. reinvestment absolute then estimating on flow to year, decline ratios, or the We on reduction investment at debt each reiterated total capital cash last includes cash of borne assess As base margins begin by cash cost, value. our flow Evaluating efficiency, and reduction, our is of focus CapEx capital results economic weighing strip rate. described maintenance and options via consider free return debt plants' drilling, change today, pricing, flow, unit creating out the potential in leverage in

the flow current the This generates value to million pricing, flow free cash estimates maintaining principles, yield $XXX efficiency, demonstrates million X% a over on Range outcome This XXXX, yield developed to Range For with the pricing, the existing program, capital commitment our focused plan our efficiently X% XXXX efficient, share capital, efficiency, strip balancing results free and the and current towards in cash capital approximately the prices. the utilizing assets. absolute to strip balancing production at an X%. goals infrastructure. XXXX focused free well Range generating over capital at than managing efficiency of operations that debt, pricing, with XXXX flow enhances In budget $XXX estimated these we growth. going is leverage combined the the of equates a from expected strategic in working our margins of developed After and debt, quality XX% plan free reducing reduces capital objectives a million that or of maintains is strip budget, approaching At of cash including Marcellus. flow in and cash XX% changes XXXX capital meaningful $XXX XXXX lower maximize estimates

debt, Xx with capital plan reiterate the we believe a we improvement. our less While allows structure, remain balance focused for To asset balance reduce than sheet outstanding leverage the us accelerate to XXXX to our optimal on business. is sales position on sheet that philosophy

see efficient what of We more be become ability assets increased acreage summary, remain quality, consistently or focused of to to capital shareholder demonstrates expect our share of on stock the flow. such when shareholders, highlights dividends. focus, meaningful programs free as the also would the a its and Range's through to such able that commitment willing intention price, durable plan programs We As intrinsic top-tier we we disciplined to return value announcing allocation that the we tangible to improves on returns In into today. as our with converting sustained application and capital you. back delivering these and framework. towards and believe we've opportunistic progress target, Jeff, operations cash XXXX see disconnects substantial we buybacks between asset

Jeffrey Ventura

Operator, let's it open up for Q&A.

Operator

[Operator Instructions].

first Holly the comes Scotia line Weil. question of Our Stewart from Howard with

Holly Stewart

off Maybe, just your it's Jeff, of continue about we out just the whether the could to about landscape in talking start M&A selling there, by kind overall just assets. elsewhere, Appalachian Basin thinking or pursuit

Jeffrey Ventura

I well, that asset question? Oh, talking the not M&A, sales, since think, corporate you're is about

Holly Stewart

Correct.

Jeffrey Ventura

to Yes, royalty just extent sell fair is good clarifying. market sale in year have asset that possible a by as market, assets, it's key X% Yes, price probably tough for. think think it's this for, a we price people a quality you last but looking that or I evidenced I are to the our the got

market. this it to down So I comes think

that very of assets you've it the patient, we'll right -- to aggressive we be we're you're as If not get can done. them and will got patient, course, as be as

have we I So opportunity. think the

in laid But extent that We're think pricing. it's on not flow forward. we'd balances higher full good free our sure, done, positive plan and a at flow sales -- the now great to I growth and asset moderate out free value can deck. that cash plan get yield with we cash we've has to a accelerate like relying strip

Holly Stewart

kind on But like below optimal capital touch know maybe, to before see shareholders. out I the Xx Okay, of about on deploying just back could could just -- you talked if Mark, what sort Then there. of great. leverage you you term if near to you'd maybe touch targets

Mark Scucchi

Sure.

we laid still I think out last the hold. guidelines year

strategy. And of you return our Xx. ability as certainly, the the increases X.Xx, do of to below below the that size is long-term becomes, The target, approach And a think frequency core element approach that goal increases. Xx as and in interest our and substantially. you recurring then, think, likelihood, capital the I a Xx immediate Our I of

approach of scaled as long-term sales, and as So becomes it's conversation opportunistic and we meaningful strategy you and board think approach improvement But a the balance that I members. element execute that appropriately, amongst accelerate target. more that X.Xx, again sheet a the asset management and our

Operator

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

Arun Jayaram

would wondering on if capacity operating you understand, and be the restored. the XQ thoughts East outages, in us on I Mariner financial and help and maybe was could impact XQ X when

Dennis Degner

still we Yes, news be is, At Energy point, imagine, unclear good close that with in restored it's you status line. The line. will this optionality. at as the is operations little operational that folks on a Transfer when would this on contact, remain around Dennis. have the of particular We is

We have basically that markets. outlets our other regular other we to on transport ethane use basis to

that X,XXX, prepared financial of X% but first our line production first I we're year. look to we're profile in We than aspect, minimize particular this think continue at point the capitalize at environments quarter. don't pricing and and to we've to have the that also From both on shared feel something the like the track in it puts growth we sense, the We the impact call those here options do to through also through a quarter on when other us share it makes most with today. so continue that for guidance with we'll

Arun Jayaram

Okay. And discuss that capacity you the just you on the cost Could X. and capacity, East Mariner cost? have maybe

Jeffrey Ventura

whether Mariner Alan, talk strategy taking But, typically the capacity? or that provided, of about behind Apex West. you can East or it's MEX That's not the perhaps kind we've Mariner I detail

Alan Farquharson

taking just to it's is Laith And very Internet. look was summertime, pipeline, It for not seasonal. is, storage are challenging, on Overall, out market it's But point has it on not unfortunately, but it's the published tariff demand. actually, available a of deal Northeast I'll bit more market, rates the preponderance wonderful own And reasons local there in winter much that make saying, there's the -- on demand. little is there's Sure. People a confidential. up, a the the area. the the great though, can this, so as details in MEX capacity, our of local

in as can our strategy and can natural products and build that directly, portfolio we our in the to kind much marketing with gas, of if best like up industries realize optionality we product our overall so as our diverse customers we to like So we're get prices.

what we'll let's it of out on year, fill volume optionality have with to on barrels to we'll sell So capacity next remainder to on actually that to on the able MEX be or continue put space, we've existing capacity actually lockup taken to and day local actually XX,XXX per starting markets and is MEX. our of say,

it way the a as it, enter thing markets. we to summer to a a and around. It's good all actually MEX see It's markets So again, provides good forward option have. the the provides capacity, price for

Jeffrey Ventura

provided and and I might we outlook, 'XX. provided of then year in embedded XQ guidance embedded five a the when it's about outlook five you through in further step of down in cost XXXX that add that the the in years in 'XX shows step to we Arun, down the that see also 'XX year XQ MEX the that from guidance the pricing in XX% cost is the the WTI

Arun Jayaram

the was think have my wondering you PDP evaluate final Terryville asset? as you are I valuation. a what breakdown, this help the $X.X if question, for you could billion And next us with And Great. steps here I

between If Appalachia you Louisiana, that help that out helpful. break be North can and will

Mark Scucchi

to the you refer the reserve to valuations. back and the reports in give I'll you So the XX-K

the said, And and the forward and the and we and flow, to during the and asset and preserve to allocated element on returns I the and the asset. the to starting capital. there capital I that the North capital the path allocation of Marcellus, value we value directed evaluate of of the is optimize at for designed And for The optimize and capital here of to look division plans to think cash explore based is are that matter no that the of cash allocation I this that plan. is risk-adjusted capital described scripted of percent portion. the is framework again maximizing continue value flow to to that said, point the Louisiana. with XX-plus Louisiana, at That focused being our some relates it returns on North capital capital XXXX as year, for to allocate the will As allocation the

Operator

the Your Sachs. next line Goldman version of Singer Brian with comes from

Brian Singer

invest into much of underutilization versus there full XX, moving drivers major market your drivers of contracts full versus capital shift are scenarios? Slide maintenance more of or to would more selling to more reductions cost utilization potentially the that? maybe this On reinvestment that cost versus transportation from result in as and what's transport grow the How in balance unit lower of local the

Mark Scucchi

the question. costs, unit components where direct Slide coming where and you just the from. a That's out savings actually Brian. Sure, and can I'll of the where lay XX, we good you see to are magnitude

driven course So Mcfe It's the by 'XX as savings. in trend and the in year the gathering, five in $X.XX outlook, QX we over out look of cost estimate at from on part processing large we roughly transport. savings

utilized. If you year-end, think and is about there a element gathering, transport, fully significant the the as was transport processing components long-haul that, of of

would for expect we incremental as forward, described Dennis volumes. go and we in-basin to earlier, sell intend As

that fully down that and early on over you're that kick-off at also the with maturity. there continue we over the so of the contract, that smaller there's some come expire, utilizing allow to the embedded you existing those should given that you to contracts the begin and have out would or have a early volume simplistically, economic the Marcellus up larger the optimize drive be time a start our outcome. per-unit most to base, So ability I portfolio basis. spreading have And optionality and to to cost on option point

processing some year. early off that have as also next as We capacity rolls

elements the that over five or So driving is. year growth contracts just depending outlook what ultimate -- to our down multiple in relative there a are path optimizing modest on some paths multiple and terms forward

also You pretty much board. across see savings driven the

Some LOE of the savings through bit are a possible little front.

then, down savings well. have in on pay also as down of debt. some per-unit driving savings basis expense course, interest we as there's You G&A And in a

Brian Singer

Got it.

Slide G&A, higher on the column scenario you as and XX, more of to, the perhaps, lower relative guess, Slide and referred for the skill I ability it's 'XX on for really So production you to that to do comparing XXXX XX, see? to scenarios analysis the -- the full year in transportation the XQ

Mark Scucchi

scenario, we're maturity, to and we around the out In laid gathering if are you have on paths it objective. up predominantly managing there the scenario different have that those you transport. here optionality as is yes, again, an that are example, multiple a under contracts same But coming that were so achieving

Brian Singer

quarters? then about my that And Can you follow-up you just see is the to in across trajectory XXXX. regards in the talk CapEx

Dennis Degner

the bit five tail about than will taken similar an it years have you'll the is loaded -- a about off the bit just the start us being QX the that at When with be for us it the to going to actually while It's with we in call, going toward also around growth see good the past over in earlier be XXXX. talking be to very a Dennis. the less Then but talked XX% outlook -- It's consistent close aligns look of be our Brian. few for approach to year rest is we've little a year. end for XX%, but that quarter. we're of front-end you year. little activity XXXX then of could actually, Yes, year to QX that but This the

Operator

the Your next of Ron with question Rice. comes Mills from Johnson line

Ronald Mills

and calling impact talk talk a you upper cash guess, just there is the growing output balanced company delivering gas know approach to the leverage in free of flow I flow basis, when a is $X.XX cash to the from to quick about despite the you was where kind about Slide balanced flow. about an can on you environment think free you it's the I think on if growth -- given growth? annual free cash growth question, trying about have same likely I pretty single-digit a that get XX, mid- where you -- something but is talking away approach and

Mark Scucchi

we obviously outlook case and the year what number out how year, year good five thought difference got in here. think go on we laid a Last we of we allocating was had how to sometimes That's It a a were the year. an and example framework to intending specific you was or a how But success, growth behind more gave stated some this capital and measuring last do objectives that process what it. we in I in competing metrics differences see Ron. question. example. about Thanks, And the were balancing the this year it opposed focus you've as and that's and

there that achievable, type laid deck free at generated ball we've but the growth cash a and XXXX plan, end free production do on and fallout yield up flow you case price the the X% of So out that single-digit predicated currently cash the within our production at process. out year-over-year results as was a thought flow

point, So of growth primary present your metrics. allow input and on elements certain which It to grow cash unit does improves to free and cumulative some focus your maintain process. you the cost. It the flow, advantages to improve is the does

than drilling back flow. to mid-single are scale is prices number at in prices out the or production increase cash time, number would type it's growth reinvestment the growth is rate and higher, say free are that's the to And fallout, that no digits that reinvestment something in preserve less this what an that's we at free path. deck, price there be would lower, point out yes, production the say, in a activity, If if would would at So I would flow, cash fall point dedicated gross acceleration that. I but not in

Ronald Mills

the it remind do keeping Okay, where relates about keep and/or within your to allow the gas as either great. you selling stream the and ethane standards? in in still markets us meantime terms in into can you stream. then pipeline Are you Can side, of your on the at particularly And you you just talked local quality? gas of contracts the contracts stay in the point just or

Dennis Degner

question, Good Yes. Ron.

impacted don't with we that any volume see if pipeline issues the that's With quality inject on were MEX, to volume. we spec,

really And it isn't the that's overall recovering in if the question, value or looking of just is with of that. the So typically, the what ethane gas stream. we're portfolio the at there broader leaving issue any

Ronald Mills

you way does of guidance, rejection guidance, staying recovery assume terms And in or you're Okay. the the about moved in from talked you then that mode? to

Mark Scucchi

Ron, of which may for have whether course upset we don't direction, kind optionality, both. look as we good in done pricing take basis. that to QX some opportunity extraction an a litmus a pricing, better essentially saw our part to swing plan max back of look other we we of condition will Because it's you actually tests, to over into other reject like do really so. the year-over-year plan to advantage gas the as certainly maybe, of we've an look have stream. or on when an When in natural as drivers we When we we look move our base annual we at basis, maybe

Operator

Grigel Your comes Macquarie. line the with next question Paul of from

Paul Grigel

on the a by Is that is please process? ETP hire you an still that being provide Could update Range? contemplated

Jeffrey Ventura

to do give bit. an Yes, that. let me a on that, update me And little you let up back

board SailingStone, the jointly X off come have on. four Range last to with As summer, go we agreed directors and we announced directors

has X board. Steve as our addition of and now, added and former board, have the to of new Steve stepped been right two He the of we directors one great of RSP. those four As off the directors, Gray CEO was a

other closely of and board need whether little So revised we're another like The the still not. a let that the process in final SailingStone board let until slot decided or and time we place to then director working slot newly get in filling to get that sure then pass wait has and with high-quality Steve. we we the board make

Paul Grigel

on the there corollary, some of And as are the the overall decline you any balancing directional in the time that in system plan? year could on then elaborate five rate out change a constraints decline? And are the corporate over

Alan Farquharson

overall XX%. is with years We to The in think we'd Yes. about I very, is or This that. said decline very five so Paul, have is be you. historically Alan. consistent historically provided this to down that very similar we what

that XXXX One of things a that activity in because saw low-XXs caused ramp. had initial was in last of quarter the was fourth year and the very you ramp large decline, we that

the of benefits of decline decline. because consistent I systems Yes, constraint? you're and is very, seen think just overall flowing historically, And also the there assets. year. to longer But into. continued in think lower really laterals a than just what quarter first a of historically, the previous year, of rate the really it's we've those I they're other some It's assets, quality not there but is is just of other material quality with are, the the seeing thing it's activity very fourth from wells function the which the

Jeffrey Ventura

it's that XX% all part near the low Appalachian is isn't of Permian it producers think the maybe the -- and -- even I the will for is Below rate. corporate gas the the of argue class Range base head have the producers, class, at double of would declines alone the are head key story I Haynesville decline almost producers, let that. that that's

several flow flow So where which our competitors on. positive generate yield free that negative low allows and corporate be low maintenance decline capital, really cash leads to cash so flow cash are to free us free of now, and good still

position, a low think us or great So in that puts quality decline. I base

Operator

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

Robert Brackett

that length. a around the lateral to you economics, year lateral XX,XXX. talk XX,XXX scaled with outlook took you noticed was that. length the question Everything from -- do in typical the five I had I about math year there? and this of five there for in something lateral year see on make to Or plan? you kind where is going lengths done And easy us? the Can your

Dennis Degner

is Yes. Dennis. this Bob,

at is ahead XX,XXX-foot for you would as some going also the you drill the And we've given across at number, track we upside plan really, average with the and just Really, this little divisions be that higher announced record in that here lateral. the is a XX,XXX when records though, bit As numbers. of than just to feet. look is that both the plan to imagine, look XXXX, Appalachia us for

and we're plan so look always the how executing, to able to we in do sense lengths strive what makes is forward we're where the it financials As communicating extend lateral saying five and year at where are going we our you versus we're the going outlook to what in are field.

to of the asset. in So you continue like ability prior to just improve years, efficiency our should as extend our we laterals expect

Robert Brackett

Okay.

over So math. mean the use that back except an that's way the so that shouldn't in should year, anything reduction increase to do I the just to five easy

Dennis Degner

correct. That's

Operator

from comes Tudor, line with Panjwani Holt. the of question Pickering, next Sameer Your

Sameer Panjwani

Some and peers Slide moving some of spacing indicate moving lighter concepts. in have your on the of XX the presentation same Marcellus, of been the to you're towards seems

provide you your can So count? inventory XXXX your some color what's design into versus baked on spacing

Dennis Degner

going to position when from the Yes. the you and over our our you've could gas that see we imagine, from eastern and BTU-type County, X,XXX-type spacing, Sameer, gas Washington years. different. everything to as acreage got you means But like we like plan side Washington field, look inner That X,XXX-foot you western across well where structure. how to look have side look go as XXX- the spacing. range when as you past you're several well at anywhere wells have. we the of that County, that would And the the dry studied rock of the you at we've be X,XXX to lines up be We performance the the

we like look to positive spacing. we've path the that had results you the type and prior is continue time, us our But revisions test over in of position at plan. what most at the you inner we look historical and also course when well we're when So well how and at optimum look curves of the

Jeffrey Ventura

thousand to the just little thousand our foot they're the in that you highest, whole trend foot operators recovery at per look the thousand the part part or play, per of the look our I the in in southwest our any of bit. southwest of of at a play the wells the add When really -- cost per on would lowest.

that combination certainly great where upside with upside we're. a be So that's and may be that could there time. good comes But

Sameer Panjwani

your still a this back some right comments? the also capital the today, allocating that sounds Okay, Terryville. you're way thoughts then And in that's clarify versus just It to Is interpret regarding of year. to keep wanted while decision I coming sell earlier like your helpful. there's half of

Mark Scucchi

is creating to all a value, can long for This that, record foremost, of evaluating Range and compete is return has Mark. that led assets portfolio. to I hydrating our commitment history on has first and And rates would on long approach a evaluating assets. of the just track to that capital say

stand no path the allocating and we it forward. matter value very leave again, to flow, optimizes capital cash preserves budget of as Louisiana a the North So today, the modest element

leave just I'll it at So that.

Operator

the B. Riley comes question of Rehan next Your line Rashid FBR. with from

Rehan Rashid

the kind 'XX. not million how two setup do the big balance or $X right? you billion tranche 'XX, one till start next Just and One, sheet, on is those almost but one. on do in When sale, see planning questions. of to due unrelated $XXX for quick royalty to would that a you address That's those overriding question, one have type two, that two, what And what -- of to or context, another maturities? transaction? the --

Mark Scucchi

Rehan. Sure,

starting first, bond with is So the balance right, first majority. it's sheet, XXXX you're June the

We in those are a have with we of in time fair us be to proactive shape dealing in that good maturities. enable amount to

to market and execute bonds. the and So having terming the choices frees liquidity and additional can full-on those optionality up as under also be proactive the high-yield out. we asset accessing sale, refinance those We revolver in that is ample

things as year. course So the expect frankly, this you of of ahead can time those to deal with us over well unfold, maturities

especially when modest asset also is to that think growth yield-oriented high-quality investor high, it the for you it, override, As a a has instruments growth potentially relates component. that to a component that demand

more was that sale there in last of and October interest year. override closed when executed So we that on

were depth Range's prior is to starting with point X% had in that in more we an there that a interest. revenue good So sale. NRI We that there believe XX% market. net We high

the we're XX%, at So in well average area. the still above producers

willing at good shareholders an repositioning and that to consider additional while potentially the see realizing as also the for right cash good value would We valuation. be balance yielding crystallizing we X% upfront, X% So to flow sheet.

Rehan Rashid

if happy would what point, enough that. independent that stack gets on should be one be to Are kind sale say, follow-up a of Louisiana with against, happy. these you'd just of How quick one Just just leverage the asset? up decisions? Or let's

royalty do You something like won't this sale. overwriting

Mark Scucchi

between of is finding mind a The and without unpredictable very the meeting sellers. market buyers

we as timely year, multiple completed in as we a try paths proceed, of did So to the fashion. time divestitures, transaction same to increase at fair a we much last probability the on proceed down getting

are they it that an Northeast say of packages, it assets each other be in the would sale or ultimately, portfolio. dependent I So be each other, the asset be PA it on override, acreage,

So we are moving down same the paths time. at multiple

Operator

conference. the nearing of are We today's end

will go Capital Brad We to Heffern final Markets of RBC for our question.

Bradley Heffern

on A couple the guidance.

lateral look count pretty but changed at down it costs So are that the have much, the similar. The lengths the doesn't XX%. year-over-year look CapEx like It CapEx, like well well is the is longer. looks

was plant could that I So additionally, and little a it then I to you low assume liquids the guidance quarter, Houston in was And artificially hoping that. fourth XX% that, by the the was me. reconcile mean, seemed XX% downtime. reduced I

as color that on well? any So

Mark Scucchi

the and drilling look you at turn-in-lines at laterals. the Brad, really, as activity, long and for start drilling the activity. I'll really with you the we look talked story efficiencies was XXXX, about, When

continue activity from that see You'll to the XXXX. side as our through progresses

always kind look what So count coming how rejection extraction XXXX in into versus some proxy we together. as well be really, mix. about may outlook, about of line the some activity also inventory in ways it carry that's and year about, five to flexibility rig we stream when again, natural you stay at our we wells, liquid the with think for From standpoint, a best so we not would you and into of feel gas as see talked all good number

we that we well any brought online quarter, contribution. wells any off dry maybe we'll the see gas talk point may about as influence or recently call. at start So exciting We've quarter got also some that mix given we in liquids that next

shared over All we gas percentage. years. in influences utilize few for heavy of our essentially, past percentage be notes, infrastructure that processable it's focus earlier to to liquids committed at the that But in to the we've going call look you that window a that as the us

Operator

would call back Ventura today's his This I to the turn you. over to Thank question-and-answer for concludes like concluding remarks. session. Mr.

Jeffrey Ventura

for appreciate everyone, morning. that. to this to time our Thanks, taking Yes. We listen story

you questions, If additional up team. have follow our with Thank you. please IR

Operator

for today's your in conference. you Thank participation

You may time. disconnect at this

Range Resources (RRC) 26 Feb 192018 Q4 Earnings call transcript