RRC - Earnings call transcript Q4 2019 | Range Resources Corporation

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Operator

Welcome to the Range Resources Fourth Quarter and Year End 2019 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. Statements made during this conference call that are not historical facts are forward-looking statements. Such statements are subject to risk and uncertainties which could cause actual results to differ materially from those in the forward-looking statements. After the speakers’ remarks there will be a question-and-answer period.

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.

Mr. at Range President, Investor go Vice sir. Laith ahead, Resources. Sando, Please Relations

Laith Sando

thank operator. Mark Financial you earnings morning Scucchi, Speakers call Officer; Chief Chief today’s Officer. Jeff on you, Operating Dennis Thank everyone Degner, call. for Range’s Chief year Good joining end Ventura, Executive are and Officer; and

our that website. the review Hopefully you’ve we’ve release updated posted investor chance on had press presentation and to a

We XX-K under it’s Investors EDGAR access our also on tab, available the using can yesterday, filed SEC the with you our SEC’s the website it system. or

Please non-GAAP measures note certain be that referencing on today’s we’ll call.

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

assist other of cash For additional information, measures. we’ve non-GAAP posted supplemental the to margins, EBITDAX, in and tables website on calculation our

With the that, Jeff. over to let turn call me

Jeff Ventura

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

on cost sales, Looking bolstering program steady XXXX, objectives, our XXXX budget. under progress made safely assets creative strategic multiple drilling and our back our Range reducing and executing completing original key improving liquidity, at debt, structure,

first, detail, costs to out unit will don't the lasting drive that and flow on a reduce unit margins Mark cash able price. in of was by important that XX%, require at Looking over cash unit in course improvements the reductions cost touch but XXXX. to it's more costs Range these point commodity enhancements to change

well innovate on remain Operationally, Board the ahead. efficient normalized XXXX, focused continues the more across GP&T, even expense, team G&A, becoming in improvements significant the reduce in costs. made we to on and LOE, While interest we and years

the discipline focus of to million spending operations, discipline, XXXX efficient plan savings, capital reflection achieved deliver on is originally capital a second able $XX team As a the consecutive commitment year result which has of planning, our is of these than This Range than to for and types operational less budgeted. the budgeted, was less a spending. thoughtful laser

Range producers, leader per well amongst the in a been cost foot Appalachian has Marcellus. since discovering

that out coupled the to costs, based decline, all find approaching was Range's ways a come core D&C is plan XXXX we're with capital. costs operational our allowing our leading lateral the best discuss our foot, our was will per decline wealth maintenance XXXX shows very peers. approximately substantial entering Range's base for that amongst to and in $XXX efficient shallow $XXX which class together for sustainable Dennis approximately inventory, million. capital low laid of even maintenance XX%, with to support more become As continuing

sustainable the very from Importantly, figure this drilling, leaving better sustainable efficiencies. the XXXX capital and year for and is a similar, many is as seen what unlike many is This maintenance completing we've equal to positioned all – continue capital into Range. going in well lateral who in turning beyond, capital million, massive others with of us for draw tailwind footage couple differentiator or in as live Range's line forward XXXX. $XXX the industry, are Bcfe years to outspends downs per all day provide X.X the relying short to significant is or produce in positive the a Rather, on for a in last

macro. see seek if scenarios, as we various infrastructure looking we at and to Prices in our that and which $XXX to our as cycles, financial existing are have year's fortunate every at we operational have are adjust different down above cushion efficiently month, In spending this capital plans program we budgeting programs have But and is cash with improving last our an utilizing then. no our optimize year and aimed million multiple year's aligning don't announced since flow. we We is outcomes. over flexibility we're This commitments. come

capital our adjust will We accordingly.

priority. As remains aligning spending with a flow cash

below coming requirements last would Range’s highlighted, costs years. two for our years capital wealth base previously budget just and touted decline, maintenance I – for low shallow the As

are going we out multiple years expect Range in D&C of all results. time. simple as unit base positive reported others spent for similar the us delivering XXXX, exhauster differentiators in of free flow providing cash Importantly, inventory, in results forward Taking wealth capital these producers the remains let inventories position relative they for Range and core Appalachian solid efficiency, ahead. capital production. a look using with over the decades a actual at

add the flow at and from our made absolute spending operations us our has significant to asset at by operations debt billion allowing we back bolstering our continued approximately to last Range sales. $X hedges streamlined Not progress also or have Looking through XX only our financial reduce position. capital been structure, months, improved cash cost near

In with quarter billion, XXXX, increased fourth on from credit commitments $XXX $X.X enhancing of refinancing When paired the our the we $X liquidity. to million of facility the and also remain further billion assets debt additional focused positioning its cycles. de-risked our company to active in monetize in January. through efforts the for has success We Range go-forward on remain plans. the of materially

not value is reflected in in that our base. Range's Value asset its substantial but Range in at also financial we that that market proved equity also reserves today. This position, store only XXXX. reflected sales of is the reflect year-end has XXXX asset accomplished The in believe Range improved value not the significant

Range's of was billion. proved XXXX, $X.X PVXX the year-end At reserves

our share. current For per after debt at balances backing this equates to $XX context, over

Marcellus also next addition In thousands for of the future additional proved Range, Range and years accounts core reserves, a has of class-leading development, inventory that to provide five only wells which runway.

depth shale important and to both growing in an as comparison advantage become and basins. competitive As differentiator Appalachian well narratives inventory as peers and operators is other the life Range's core inventory for of core industry, exhaustion

and a we derisked We Mark efficiencies I'll go-forward made unit our we in second down for paying a billion and refinancing at plans continue debt term the Dennis, maturities. in difficult year the delivered to has commodity over nearest cost capital well in the to face I that in significantly, row, progress over less we our months significantly than and plans $X our environment. lead it turning originally Range XX last and Before budgeted think reiterate operational lowered over costs great our of

Over to Dennis. you

Dennis Degner

Capital fourth with $XXX acreage Thanks, $XXX million. for Jeff. includes million million $X million the drilling totaling and gathering and at in other capital approximately This year for our $XX for on $XXX quarter spending and the spend million completions, for support activity. came

plan current in at environment. operational electric and reduced XXXX as Our a fracturing was upon actual beginning our an efficiencies, of is technologies $XX result the below direct operational million such of and capital Range's fleet set – innovative spend and implement the service costs the

the completion message ago, our capital program. one underspend continued and our cost initiatives reductions. attributed that our drilling year and the primarily of underpinned XXXX in Improved service efficiencies recycling to success water are Similar to

into on detail clear. go was in I'll items just these a more message our minutes. few year Last

spending or above not exception rule be at to upper delivered capital the came us putting at the X.XX per QX the and team day, Bcf our end budget for expect yet the below again. guidance. Production equivalent in firmly quarter We the fourth production of

This higher equivalent day, X% generated per approximately production annual X.XX than XXXX. Bcf of

liquids asset sales was and production of includes during production impact annual year. executed the XX% comprised the Our of

out and of Southwest time new run our excellent year. existing helped strong both wells us performance Continued the to PA operations on our production well across from round field deliver and plan

been the with activity our As XXXX, forward capital set on has focused we program. Marcellus at $XXX million our budget look Appalachia, into

our capital while year, position. allocation located the to We XX in capital have the be to drilling activity during sales in wells remaining consist which lines The earmarked turned last will turn-in XX% in directed completions-related is with approximately of gas budget. XX% of being year's split XX% our of and being dry our towards acreage to across be with the result will line liquids-rich program

Similar prior turn to from year of planned with production. half this years, approximately to pads sales existing to will wells be the

a production routine fit year to in an maximize back I'll program to of great infrastructure fracturing now allowing part a and year go detail pads out, will electric with fleet, and more be later. Moving cost, with our which existing reduce become into us utilization has

will projected increase is year. average while Our per averaging drilled feet With feet, horizontally this XX,XXX to XX,XXX planned our to approximately the increase average in turn leak horizontal line well over The production is evaluate and options ample Bcf approximately for increase at we X.X as XXXX. equivalent day year-over-year XXXX capital provide maintain both. for plan to for flexibility projected per a

Consistent with first the quarters. to towards year be spending XX% of expected weighted first prior a of approximately and years, spend capital place across half taking the with capital is the second the

the an average allowing located and XX for Appalachia, XX% Looking in wells of horizontally the turned to sales super-rich XXXX quarter the to sales seven of XX This of the portions field, total the feet. of pads infrastructure. from the of of wells operational fourth existing team with wet In the over quarter's on wells brought number XX,XXX utilization turned back during highlights. some approximately to on

the all generated of were top-producing six of the and acreage quarter wells for of super-rich field our dry, and The wet our spread wells This sales in our included turned top-producing fourth the some across three to year. for wells covering XXXX. areas

strong area, gas wet feet. QX, more wells costs. gas to utilize average than gathering horizontal unit help performers in of turned sales wet fourth XX,XXX length in wells were the in we the In The quarter resulting our an lower XX with and system fully

ability flanking Both These years million than acreage wells on approximately and consistency north the feet pads we and sales further of south day the equivalent of super-rich super-rich showing the performance in ahead. apart, five of for the cubic of in portion XX-day the per pads XX our field, In strong position. turned have repeatable the generated well, miles more rates to quarter. pads our are ends XX two per

where the per was pad in under remainder and the sales year. our approximately at early pad our of the the fourth quarter turned day area, constrained lastly of conditions XXX XXXX sales feet million highest cubic in for total dry And to producing produced to seven-well we turned gas

team drilling the higher increasing footage quarter XX% year than average. to able efficiency fourth was longest our levels the lateral achieve some daily average and XXXX, laterals in our operational to new addition full QX to of the drilled with approximately compared In in XX%

drilling directional curve peer-leading per in during to within level. capturing both drilled quarter drilling and daily efficient our latest and average attributed lateral efficiency daily planned staying increase X,XXX an our performance of while drilling target capital feet the the driver for Range utilizing In fact, footage in footage all day drill is substantial for type operations, experienced XXXX. a and key for most technologies more drilled This applications. complete of is fluid than This month our directly lateral

stages completions, to compared increase the In the completed at of average X,XXX year reducing under of X.X stages per year, an efficiency prior day, just an while X% during represents team crews frac the the number which needed. all

completions the efficiencies, this continued emissions. $X.X their starting levels testing the fleet, which resulted fuel improving of replacing three test XXXX, pads the capture was By to addition efforts contracting team and that to fleet quarter. savings, on in in operational In in fracturing the reducing over with electric-powered an fourth in while the fleet million noise team able diesel

using achieving a versus significant to to impactful, fuel fleet clean several great When we win environmental operations our utilizing the with look natural as emissions. at in a with reduction Combined EPA factors, a creating and conventional this goals. step a burning ability technology emissions we becomes next see reduction and significant fronts gas on our emissions this the

our again operate represents our our which efforts our sand will fourth In fleet existing frac the quarter, team this fully first approximately be activity initiated we with the completions. program, XXXX to source also as utilized on The of production, for in half pads directly year.

and reduction fleet, another the early is durable cost to of our with cost approximately observed reduce coupled in fracturing associated with from reductions. electric $XX producing yet Projecting million completion the costs estimated XXXX, by layer savings

and continues cost our Lastly, calls, program similar Appalachia. water on discussions to improve efficiencies recycling Range's in prior to reduce

$XX recycling totaled XXXX. of addition as versus our to water, And over completion PA XXX% producers' barrels X XXXX increase XX% by reduced Range's million more In just represented result, costs a utilizing a than million. in year-over-year water under of southwest other and

gains, remained reductions deployment, building reduce XX% safe just safety job focused as year. team cost look task addition recordables on from of incidents able training OSHA to upon paramount the Through to compared the to and workforce Having prior is to evaluation, preventable and importance contractor In vehicle XX% with message goals by the under have a ahead loud is and results The in teams performance. expanded clear. and efforts the just our our teams year efficiency and work environment were we and initiatives. these forward the technology

efficiencies operational see complete a by production, a producing repeatable we translating per the with efficiency, this technology, cost market-leading durable drill captured consider pads you recycling and new teams, $XXX water capital into When the foot. deployment existing of of utilizing and

gas but On gas to challenged, the is for natural relates obviously it reasons strip marketing front, as the current we fundamentals. optimism natural see

Looking of the we with decline along with producers crews, out exit frac XXXX. gas cash natural reducing guidance, supply the since decline or by lower through anticipate first the year, we most and will of to and spend the counts balance XXXX, U.S. at year-over-year CapEx the the rig below year-on-year as shift spring flow

record recently per On feed coal-to-gas retirement reached highs new day in additional winter additional the to announcements. side, gas and power gas is coal of demand January. late in burn Bcf X plant LNG switching leading U.S. excess

gas into and contribute European in switching imports Looking cautiously this internationally, summer. Europe Europe pipeline we and can are coal-to-gas lower rebalancing higher gas storage to that optimistic Asia

a and domestic improving picture gas improve potential Looking industrial and in supply into $X to LNG gas fundamentals, international above should this next global balances domestic declining demand serve growth trade to pricing. to in believe with points with per prices year, XXXX continuing significant supply, improving coupled demand MMBTU. improved We Asia natural slowdown

fourth side, crop the continued gasoline NGL as for demand Range's increased on On dock well at blending escalations as heavy demand premiums and the propane realizations quarter liquids butanes. for drying of export

until demand is in capacity of on significant Gulf This Range for the X barrels. year, a Mariner lack expansions exposure. increase pricing later NGL premium Mont U.S. we at is Belvieu a with guidance support Looking premiums Marcus reflected strong April in see starting this forward, coupled expected our Hook. to XXXX, its XXXX to continue international XXXX, for LPG to to Range's as International East benefit Coast of capacity will growth

the our operational, safety, initiatives in the teams executed achievements we and being XXXX section, environmental creative allowing all our goals, capital-efficient deliver all their to operational we operations with yet. us like to program congratulate today As produce most our wrap-up I'd while for along on and

I'll now turn it over to Mark.

Mark Scucchi

you, Dennis. Thank

calls, position through previous innovative stockholder margins significant strengthen value. protect flow continuous strategic principles, grow guiding on we our business to the or investments believe mentioned can to and fund cash and on cost agreements. the sales As to these sustainable further priorities principles and in from Collectively are executing financial create management

facility the reinforcing base taken monetize interest to supported First, nearer increase in decisive royalty foundation. peers non-core And let's the for discuss bank quarter. during first moved fourth in to financial cost early public Scale bonds among million million were We've a credit in $X.X strides unsecured acreage we to to term and $XXX sell issue the raising been $XXX January, significant Range's capital and and assets as refinance billion. asset advantage quickly and commitments under prepared maturities.

maturity In reducing the $X debt the the over months, capital extending by profile. in into $X.X aggregate, this billion, XX totals last brought over debt billion XX%, expanding liquidity the by and business

about are current commitments. the a workings lending bank reserve-based and the certainty common Questions of of in facility this -- market

elections We below to and have value commitment the well base Range's lending conservative consistently borrowing to set according made methodology. calculated reserve-based levels

redetermination maximum last calculated borrowing $X under compares the the $X.X was the base billion This RBL At methodology approximately in to billion. commitments. date,

borrowing billion soon Range's cushion continue have will using assumptions substantial from $X.X billion above both the latest its see base $X annual And we commitments. We to in redetermination. lenders, price our and

need our durability growing long Range's look is and U.S. position. capital remain markets. high strategy production These Nevertheless, We to it is packages. expanded and sales creates refinancing Despite there runway. we passively confident Though, we long wait are creating the years a liquidity a actively in before prices. a to runway, marketing do improved Consequently, will not negotiating announcing are processes are rebalance formal liquidity, asset priority believe to Several we visibly for demand declining results. prices. and access we reduction, of and debt believe Range's forward multiple and a

As maximize strive quickly will stockholders, publicly target to is set rather value than as for as our can. amount we a divestiture practice,

to investors and operating we divestitures, going to successfully fourth Results to prior objectives and what well XXXX, plans, objectives. quarter the intend ability as evaluate as what for focus full and Range's year XXXX forward. do delivered informative As have on our it's we reflect recall deliver possible financial including plans towards for and

million. operating our for periods, $XX delivered budget by prior and XXXX Capital efficiency drive better and with Consistent unit continuing capital attention close costs. spending discipline, to production, spending capital beat than planned budget to down

to and continuing $X per Turning production, LOE, transport. fourth G&A and compared quarter interest and improvements per In on gathering, drive board of of of $X.XX transport, improvement in including trend expense. unit forecasted unit, and to fourth are $X.XX the the The quarter, Range efficiency to cash and progress and delivered in per costs unit XXXX result processing unit the all-in quarter-over-quarter guidance unit of unit to of cash by achieved cost per Mcfe. We processing lower gathering, the cost $X.XX costs. across led below

in unit sales times, sales Over accounting time, downward margins. higher price the you geography expected income due or cause slight to relative margin we will see when expect and cash may to continue. transportation higher But upticks that in a in occurs trend GP&T statement. At enhancing, agreements cost the expense,

online. be are currently year As Range pipeline price net Consequently, a Mariner GP&T under it is these transport rail cost will with but capacity this has on more classified an are that by – come example, These offset margins. improved arrangement. available currently East is transported the transported capacity slated X expense, when than as barrels to barrels

line continue efficient in To expenses XXX – capacity. Bcfe also operating annual put the to just use the is no worth penny adds [Technical that, unit noting benefit of efficient direct this each these is production sale over XXXX Difficulty] margin of to and properties. bottom eight savings for cost water assuming handling in It needed perspective, fill – to from production incremental legacy

has due full-time reduced to value of lower properties in both Annual book this been reducing employee also through cash million year. we debt G&A $XX reduced and and recorded was impairment the North expense interest proved reductions Louisiana. with asset charges staffing balances. quarter non-cash reduced headcount sales XX% In fourth by unproved

unproved from in were Louisiana Marcellus. intent non-cash the charges There proved properties. lower result of with highest-return strategic Louisiana of combined value North the to for the book no projects focus The impairments acreage on Louisiana drill of The prices commodity the Marcellus. affecting our lack the

The first step is future test to net book cushion. substantial value XXX% GAAP impairment billion a by revenue to roughly in At year-end undiscounted pricing property book revenue net proved compare for the value. $XX future greater than strip exceeds providing or Marcellus,

near-term As under XXXX, resilience has pressure, we commodity adapt while its been Range's begin ability to demonstrated. prices and remain

managing For by and XXXX, utilizing developed internal enhancing infrastructure. and leverage Range a plan flow cash maintaining efficiently liquidity, efficiency, preserving existing capital driven

In XXXX million capital quarter XX% Marcellus. going planning fourth and from with these the virtually lower is were all production to we targets to and XXXX capital is $XXX value This capital developed objectives program, efficient than flat plan a to budget the budget maximize million that $XXX and focused approximately XXXX's XXXX.

XX% average well gas for XX% with XXXX is hedged and of per approximately at hedged at our barrel. $XX protected of of condensate Range $X.XX an natural over

Additionally, and commodity in capital will such is plan spending changes we flexible adapt the prices. to that can

has prices, asset environment rebalance operating again supply on of meaningful continues the and work room financial a running trends. significant continuing the recast resilience its goal to structure for created In to with price to cost enhance low these and sales demand delivered and plans, summary, Range for

Jeff, you. back to

Jeff Ventura

questions. to happy be we'll Operator, take

Operator

[Operator with you. begin. line Your first question-and-answer Thank Instructions] Arun Ventura. the comes The will now JPMorgan. question Mr. of Jayaram from session

is line open. Your

Arun Jayaram

involves first capital My question XXXX XXXX. morning. versus in good allocation Yes, the

comments, now Southwest you in allocating capital lower your rigs. XX% year to of PA As prepared reflect mentioned versus to allocation dry the last it in you're the does the XX% capital super assets gas and

that were about we the allocation capital to weakness prices? year-over-year talk if higher in changes in wondering could just gas dry just the gas seeing So you given

Dennis Degner

Yes, This Arun. morning, good is Dennis.

variables it's allocation. important on really system at plan, ability in we being room look a and that And we gathering fully one look that we our capital utilize at year-in As to those and costs consider have unit year-out, our of we host the keep low. how and the where existing of

last our of wet of involved QX and and XX% year in QX were of turn-in Part super-rich. and really XX% lines really

key to that part as whole. when now a those development plan about half think a we're the process toward as last the we're So today harvest of of an That's year. opportunity getting second and volumes just you the critical

as to that a program and gas program, be in But the the is toward of -- XXXX XX starting was project is towards there middle XXXX of gathering put in utilize be that was in will we look to -- that the also further XX% developing. some dry place the be

again fully to and utilize low. costs unit look So we'll our keep that

take and But on with and to pad to move keep on we move the existing Lastly we see advantage do program so in try we also sites pads, into changes. so back some key also always can plan prices always of we our with allow don't tend that our some commodity market flexibility for it's know multiple focused to back we we when steering ability stay change, because that those metrics. flexibility overcorrect condition the into

Arun Jayaram

in you it of expect NGL a And X just driving is elaborate costs. could perhaps terms bit capacity. up Great. It is you the could Mariner comment wondering, is East I you -- little price. the But on your if offset what GP&T the more you mentioned on

Mark Scucchi

This over Yeah, sure of is then Marketing. our President Vice NGL start hand Engberg Arun. it and Mark. Alan I'll to

So understand accounting this. the point It's is I in statement. key behind to first the income really geography think the

that sales the the transport by a cost meaning are rail the is after buyer. call, carried to current arrangement that price, net I the portion is price by of paid we scripted describe As is tried the in of

and online, something can control that capacity this comes When Range it is optimize.

price. in receive So line in processing a essence the But item. higher gathering it's it up check cutting, a we we're transport shows that

moving is a saving because and moving by rail. by pipe cost than margin it is cheaper So enhancement NGLs this net-net,

So to you that? add Alan would

Alan Engberg

that the one is for to E&Ps premiums during add differentiator just it actually. to seeing overall of directly XXXX export and continue markets. country independent improve markets attractiveness would dock The two improved a we've that I access the that Yeah. We been that access can only at the international really of the considerably to in saw have Range. the We're premiums.

go the I the of in premiums rougher in the the fourth they to at $X.XXX published If has macro back here. fourth at docks. By export one XXXX, the environment, they the quarter the of quarter -- of $X. larger year-to-date By price third actually XX. XXXX, by were were world reporters today in U.S. the

The per are year-to-date gallon. $X.XX premiums actually at

to So realizations because our higher for continued expansion in growth do export XXXX, much in expect program. guided overall and NGL we our with better we've

Arun Jayaram

lot. a Thanks Great.

Mark Scucchi

Thank you.

Operator

Goldman with Singer Sachs. Brian

open. is line Your

Brian Singer

morning. Thank you. Good

Jeff Ventura

morning. Good

Brian Singer

you may of a for you more slowing cost there But your Realize get environment need be of activity? that, at wells at of shut a you in? what internally, the some when which a the to gas both price little not price debate it see that or is better temporarily portfolio sustained least low is either environment within given how just about wanted then, bit marginal all point NGL think structure, would be to should sense further Or price variable. and environment,

Jeff Ventura

Mark. to then is our flip be me cash Yes. laser-focused program flow. sure making again, start over aligned it We're, on let and going with that Well, to

be that sure we'll and to and reacting at enough to look that occurs. we that that scenarios sensitive multiple time have make We

return. on does we'll look wells and that said, program. the have focus Team better changes good other make unit has things the job. the we'll that as will optimize Ben at all to the cost a return And the Obviously, forward versus

our below budget. We the come in couple over at adjusted of we've If you look we've years, flip last Mark. to program;

Mark Scucchi

flexibility. Sure, first our bear there's gives question flexibility and that transport say the of us infrastructure gathering would fully essential is that have. utilized, long-haul on tremendous amount come Range all, two of you've really Brian. we and a I for The the that's, asked elements fact to

those to and trying In cost costs other on words, cover basis. analysis we're doing sunk not a

In have fact, take-or-pay above contract. we beyond and production our

us shutting determining and/or the activity So, mean evaluating of what in flexibility in production, your in year were in would in extreme structure. of an again, gives of that terms you cost in if the scenario, terms level that

very the And that's a to of the $X.XX. second fourth good stead wanted with puts cash unit cost costs bring us I structure environment. it point is That really to, main in back and quarter in

beyond, For shown we've record down. track of a that consitent XXXX and driving

also that would there. critical and note our I preservation And of the expansion is margins

If been you down prices margin, given down, revenue, as the you that's the of have costs. that at we will, fact if have the gross absolute even look sustained, come driven a percentage

years, when The third and prices. would basis gas $X.XX And $X.XX. realize an $X.XX back over I look it It's are on price that natural from look per you to we point note the to make if XXXX. Mcfc. few anywhere for even at last Even is, people back it's unhedged, unhedged at looking was NYMEX there evaluate to XX prices important above that you cents -- Range's

prices of adapt that flexibility to to a again, market us gives are. lot So, prevailing whatever

Brian Singer

capital cost follow structure. is Great. Thanks. And the the also then up on cost my structure,

of about under of number $XX and e-fleets you budget? in are reducing other that terms built for initiatives think initiatives I taking and million the Is to capital you water capital is into $XX a that completion your the in budget if e-fleets Or potentially your year. were on talk the highlighted potential an million where spend that's budget? within or you savings that that mentioned, you further And have? relative be built that there's area You either can costs mentioned this that by you the could your would you

Dennis Degner

projecting Yes. today. built a foot for that savings we're we're would year cost Brian, that of into assessment the per I that say, are portion $XXX significant the communicating

the we're talking their drilling see on However, and time could the the team of always year-over-year for planning drive goalposts, efficiencies really spend whole And thing, same about expectations effort we done. continues that the the through of lot to has recycling, another team balance capturing operators, those that team of taking side, the additional savings. continue they year. calls that I those is exceeding through work collaborative worth other good And the water the a move times to a water, a -- additional the

So, from consistently. savings, in what we're do to job great the a team surprise and and expectations to continues we've of planning really expect two certainly exceed what because the wouldn't for years additional today why past just really and cornerstone it's come us have the budget, under me been I

to see we would would some savings to we fruition. hope expect and So, come additional to come

Jeff Ventura

what would would Dennis and I continues to reference goalpost. the just -- is the saying, -- team I better move get we

were I XXX So, still per at to peers it What whatever complete it hit we last to is -- moved to whatever was a foot striving or drill did they're and cost down further and lot per year that targeting, Range yet. XXX approximately of think foot. our

three across it Range Mcfe you complete where the three added, entire at importantly, think years. put the the So, we that basin results per at in -- -- average about last our team there efficiency. in total at to talked on and drilling find look the it great put new the they'll and or in lateral capital looks Whether slide over year, and bottom well you three part its and pure we I the have ways and years great -- new XX, look leading We continue I and a per to pack. capital best foot faith lead its in cost at last was year slide deck,

that alter that team the and faith we like the being will to have great also So, flexibility as said Mark budget needed. able and do

Brian Singer

you. Thank

Jeff Ventura

you. Thank

Operator

Stifel. with Trotsenko Jane

line is Your open.

Jane Trotsenko

taking my Good morning thanks questions. for and

Jeff Ventura

morning. Good

Jane Trotsenko

market compared first how royalties, ago year that say if assets you sales The let's like on s? this comment on -- for looks to the asset can a today, -- is than yes, and

Jeff Ventura

Sure.

earlier, active As asset, we the I spoken described discussions Pennsylvania County underway. processes have of Northeast We've Lycoming multiple before, ongoing there's there.

proceeds had monetizing there, Southwest of obviously But potential and acres stack of portion have scale of success royalty. resource the that of million in given a it Pennsylvania, half We in potential. the inventory X.X represents clearly in potential future pay asset, out small our billion

within capital its that our asset an portfolio becomes garnered And fair has of not active then obviously candidate. share an

data So, do on Louisiana. we North a have room process open and

projects. what we are of able multiple look to deliver of across of on think over and indicator on do. Range's an last divestitures the I And number would to multiple record years track dialogues back intend as assets there So, I being

Jane Trotsenko

there that royalties more characterize than is generally like assets? for rather interest you Would

Jeff Ventura

It would asset and not characterize different assets. base different location. for There depends way. it I are that on buyers the the

a to efficient. in a that's operators to area, want just given their Some production add area given bolt-on, may

Coast, offtake. petrochemical that in you're and LNG Gulf If adjacent one's demand the to

domestic has that of players. and So, interest appealing international both

asset and talking as who the you're be. So, it location about interested parties to the on may the depends

Jane Trotsenko

for the what that Okay, you maturities I second got the thank it. that near-term had and to revolver remarks then even question, be put the have a so would the an prepared extent to and And revolver that. of option? it very in and question helpful them, portion the if you was discussion on regarding possible a it's maybe

Jeff Ventura

option. Yes. It is an

begun open had repurchasing market. beginning think we to in I that carefully. And will disclosed, we nearer QX, the maturities on do we term continue As

So, then importantly, assumptions most that near-term deal the we credit refinancing borrowing and maturities lastly, that an as the we're at it did substantial we last substantial like cushion and shape And pushing definitely we great profile. maturities, with to fall. in current see out, liquidity prices We fact and early facility this option, feel to the to the maturity current combined the base by comes that debt and have year, expanding is lenders.

Jane Trotsenko

so it. Thank much. Okay. Got you

Jeff Ventura

you. Thank

Operator

Tuohy with Campbell Brothers. Jeffrey

Your line is open.

Jeffrey Campbell

cost Good interesting per you foot your cost specifics. ask returning lot a back this about cost to a been leading is, of of kind to just morning. of what barrel, portion surrounds discussed? question as and portfolio's up wanted lateral discussion and items I really pads to a lot My other that there's reduction, first the of opposed XXX

Dennis Degner

XX% on this this of if existing past Yeah, were back Year-in of activity is it look tried XX% it Jeffrey. to much year-in, with but production. represent call to about year-out can it pads But Dennis. during and going kind year-out basis. I've be the to you will year's on This years, touch over as several the as morning, a be back will

there's that this that fair capturing the just what them. a year savings durability capturing cost in cost this? that So are look we're But cost there one year-out is though Absolutely. bit due are – are just, we is, savings repeatable see and we're to our we of of savings, year-in, that's at the

and clearly, to is, new being E&P other team not creative the The initiative space. sand completions the necessarily for may operations. looking at directly sourcing That's that be an

of of off for durability then, from We and into there market fair profit see a where a kind of and that regard, there is the bit going beyond. because – standpoint. – However, like us has we feel from XXXX that in being paid patience

into durability in stack-up see to these start only we fleets. fair back there's we in bit as existing to pads, costs teams come. this year, of the drilling technology, So, capturing not also fracturing savings electric deploying, moving the a but years The

Jeffrey Campbell

have them then, that you like it Do about XXXX or sale. wondering Thank down bearing meet Just for requirements you in North regarding mind sounds can a that apparently Okay. any it's midstream Louisiana, close? until that. that potentially you And in there. and sale for can midstream volume

Dennis Degner

I to commitments volumes. alluded acquisition, are before we've there at was think early and of time the processing disclosed the So on on

that already So, cost not processing right volumes utilized in now, fully those line but GP&T reflected Range's are is item.

last are to driven fully quarter not we $X.XX. fourth even So, processing in for down year still some though, are from that's cost we $X.XX capacity the of utilized, paying the

year, roll-off. to of a early commitment, have portion million this did we $XX So, million that $XX

potential and So we'll to XXXX, to certainly continue optimize in that'll an the sale of improved context run be for that a rate work

Jeffrey Campbell

color. that Okay. I Thank appreciate you. Great.

Dennis Degner

you. Thank

Jeff Ventura

you. Thank

Operator

Cowen. David Deckelbaum with

open. Your line is

David Deckelbaum

the morning, guys. time. for Thanks Good

Mark Scucchi

morning. Good

David Deckelbaum

on bit on the little Being get obviously a efficiency. so this your XX%, understand years expand costs more, of well that down helping those multiple pads year I existing Just a budget you is basis. capital blended on

If long existing could sustained for? how to program just you that were remain pads, on

Alan Engberg

a Carson Yeah of me, little kind that me this let question bit. take let Alan,

all, several have over past existing and record at wells an bit the look ago pad. our track the we've the average on wells probably to XXX First we're pads we of in on about probably a pad, there, the out if XX% over average been on six five you mentioned of on Dennis little as years, we've been probably

to know, think is ability I happening. wells, very pads these long to that handle so So, runway built up be XX on we the keep our you to able the to –

our So into costs I this XX% It's pads back built cycle. year. for think the low aren't entire necessarily going reflective of been on

So won't only half be some on new see pads. situation you be eventually some where to in there, always the on any won't to – able pads you road, you – walls to be building year, able a you single some, opportunity if you that the get going can so every we're of so always be back always have down you'll building

could you cycle. actually think So costs come as longer the through down

David Deckelbaum

wondering way guess, I'm your is isn't right not market that robust a now. Why I as the obviously percentage increasing particularly of sort margins? of augmenting more

Mark Scucchi

set amount that of in the Well and way I starts process ahead just time. of and think up, that a plan of with. you takes go cumbersome I'll I is know starts the with Pennsylvania somewhat the part part start is fair with permitting that think development

may built, lot a been the of already in they pads built So been XXXX. have have

so just you a the as see to of a development put everything. this able result, is timing system efficiently want a you've you'll change to way And getting gathering together And the over use of now And of just wells in well. plan the XXXX, just as matter course, think it's the be I to drill time. and

David Deckelbaum

cash net to to payback can there's where flow? those cash that dollars invested where production gathering back the system, where room the for period and are get boils it Comes online and quickest you to and flow, back market the down

Alan Engberg

evolving. it's is I a think but lastly, here Alan piece of ever this

opportunity the the links years, they've reduce with and lot number a of look the that increasing, on just how over gathering us and of So with say associated needing to touching the when little but at the a three lateral increased two let's efficiencies and just we're we're for especially past, folks but to that system. pad for links only you to average seeing that not Range, build the lateral the bit size

of – of as very infrastructure touched So using process the think piece a integral on efficiently all really the and planning of there as this the our processing. about becomes we in gathering Mark

David Deckelbaum

Appreciate that color.

second my as question. Just

As you asset lot now Appalachia, that landscape talked in sales. at look right a you've delever initiatives through about the

success with of sales. asset interest non-core lot a had sales You've royalty and overriding

a peers I it partners you renegotiate with processing your market you insolvency, foresee undergoing of when with or well? as some side at other cost lot things Are to long obviously distress. renegotiate the with your guess do to think on control, partners, of haul of look you gathering as But, your about opportunities seeing some is and opportunities the

Mark Scucchi

assigning renegotiations some a of is just extend think play into going those already getting at deed that option transport our are and processing Marcellus the on the or at stage agreements, of the their election. early we where of and agreements good you're I situation consider important over a and today development can Range's earliest forward. gathering how then decade to may of at drop With

of that option. next renegotiation that's allow have that of to thereafter, cadence, do portions we a our just year, kind require just year this can beginning and capacity drop off So steady we not

to structure, spoken elements particularly cost time. drop decline we've do on of recovery over You to side and some gathering of the where pieces the the capital begin also out, the have before, cost

So, is favor the structure decline the our a in gather processing slope there cost the running, for transport. steady and glide on in long

Dennis speak I'll renegotiation. But detail to on let more

Dennis Degner

our I -- transportation second. doesn't the processing the includes Yeah, that portfolio, ways are gathering, and and our all working that aspects up the ultimately I'll kind a for to step higher think But optimize side here of business. of we of always on level

our mover the renewing opportunity As consider road we or Mark an how there let strategic transport be are portfolio And that about the indicated also being down to to seeing, then packages sometimes. early adding expire. we're those

we commitments maximizing our today, like we're We're So portfolio. where our exceeding FT we're at.

cycle. for are the However, sure ways strategically cost part our also partners these for so look, ways can look we for always well, we're actively right we're we for and reducing renegotiate. -- as have the We structure costs, can making that -- our that looking

XXXX slide it'll -- could we years our similar our over projecting QX when ahead, to which come look of from reduction already a reductions GP&T multiple in our XX you cost the a the we're in costs deck, past put So renegotiations. avenues, come be will in we one $X.XX and had As trajectory XXXX, QX months through

David Deckelbaum

guys. you Thank

Mark Scucchi

you. Thank

Operator

We are end nearing conference. today's the of

We Tudor, will our Holt Panjwani go for to Pickering, with Sameer final question.

Your lines open.

Sameer Panjwani

as you current Hi, on can guys, commitments? forth outlook. of guess you then just you But free above this the the I cash wanted the I in to production some flow XXXX program at your see buffer on clarify, midstream current and call terms to positive good and do been also know morning. quantify here. back have neutral or strip, ask there's I

Mark Scucchi

factor, cycle. described of, each as cash and we principle flow relates at Dennis was motivating it down Jeff as higher, flow, Again come program positive throughout the the somewhat, to that would cash neutral to it program So plan, the and flow the neutral that some at require to have be primary fund prices adjustment guiding I XXXX plan roll that were cash positive January, and to designed when strip to have and in somewhat the time. given self out kind prices our obviously, the be is prices

course and So funding there self possible. that adjustments be over plan make intent that maximum sure our as to would the extent year the we is to of to flexibility it that be this are make need to

Sameer Panjwani

terms quantify are of that you commitments. in And you production able midstream buffer Okay. to the have above

Mark Scucchi

and So got about a roughly on you X.X, are X.X, the FT side, commitments XX% production good buffer. so

Sameer Panjwani

a there's assets you Pennsylvania, happen a of Northeast just values? Louisiana it. Do kind of, of things, level ascribed the when you're of the the PVXX the from on in for to kind on values asset got open to And while. then acreage, have mentioned of higher for sale of transaction market are a and room you And you of Okay, end those? data been level get standpoint, as some undeveloped each these, the marketing for XXXX side hoping

Jeff Ventura

asset set we're markers we PVXX or any the assets for values, out mean, to not individual there aggregate have but sale yes, I going proceeds.

quickly maximize going to to the will continue seek so flow enhancing as that just to we value, just we monetize deleveraging, and forward, the So those cash can. as it's both

Sameer Panjwani

Okay. you. Thank

Jeff Ventura

you. Thank

Operator

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

Jeff Ventura

I with feel just participating Thank to thank free the you. Yes. call and up additional on everybody follow want to for questions.

Operator

Thank you today's for conference. your participation in

may at You time. this disconnect

Range Resources (RRC) 28 Feb 202019 Q4 Earnings call transcript