COG - Earnings call transcript Q2 2020

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Operator

Good morning, and welcome to the Cabot Oil & Gas Second Quarter 2020 Earnings Conference Call. All participants will be in a listen-only mode [Operator Instructions] Please note this event is being recorded. At this time, I'd like to turn the conference over to Dan Dinges, Chairman, President and Chief Executive Officer. Please go ahead.

Dan Dinges

Thank you, Allison, and good morning to all. us Cabot's joining Earnings Quarter for Call. you today Second for XXXX Thank

on will call, based a this As reminder, we current on expectations. make our statements forward-looking

reference Additionally, financial comments of will some measures. our non-GAAP

and directly price Despite which other net demand disclaimers which NYMEX during $XX.X improve natural returns results average to the are provided as structure the measures Forward-looking is the statements contributed even global to quarter lowest cycle, of income generate comparable of on earnings share. pandemics advantaged today. quarterly we we per as that financial release. and or upon These year-after-year, positive GAAP natural capital yesterday’s gas quarter, to our low-cost ongoing third positive uniquely reconciliations the the well Cabot gas trough of since price profitability very where million allowing to second most continued the still $X.XX the was believe us have in we on were impact XXXX, able demonstrate deliver to

exceeding across delivering high to face of with in day, the our X.XXX we I in end natural industry. green want seeing call. in range. quarter the team shoots of the guidance recent our the are profitable another of our per another Bcf later strong headwinds our delivered get emerging detail I into Operationally, gas will market, for our production in While team quarter more the which daily commend

our year with differential the to significant and which to in the before improvement range $X.XX relative end derivatives, differential of the is NYMEX, year guidance Our a in impact represents period. prior of full a realized comparable line $X.XX a low is prices

our quarter, for of second operating our second it's our quarter, XXXX, demonstrating control. natural half generated the ranges XX of in free cash flow free year, and first the since production focus historically the weighted the expenses our with low price the our weighted second combination gas during quarter of to deficit this half guidance flow cash In second first the quarterly all on last program only capital the were addition the of cost we a first below deficit profile. environment continued in line our or quarters, in Additionally, given half but

we Our plan within the free the cash a for expect flow to first free year. year be cover a months the the and XXXX fully of for flow of program program positive to dividend. majority of enough was expected to to free second the still Ultimately, our deficit strip, cash flow capital slight the during six before in current turning the half generate regular year funded at cash to our flow cash generate

implying midpoint of yesterday's levels the reaffirmed In with maturities free cash flat expectation our months in to with but down price is which our strong driven, gas that trough we the range exceptionally XX for a result day, of of we Bcf is anticipate at leverage full to continue while as production million seen from senior trailing matured in expansion remains to per improved this lower sheet of pay production this to net with release, only debt balance year ratio levels realizations, Our EBITDAX a notes, significant This a year our not debt have compression ratio Subsequent X.XX compression from use leverage important year-over-year. moderate we quarter. we we strip. It to current also our tranche of at on sheet as a metrics year month. prices, note a the EBITDAX X.X cash times guidance balance range of $XX our flow. repay resulting the near-term X.XXX next quarter-end, the absolute higher the by to end the the natural

program we capital reaffirmed Additionally, have million. of our $XXX

represents We Bcf also third fourth sequential range to initiated which X.XX production. X% of and volumes in roughly increase quarter in be that our third quarter of daily guidance Midpoint quarter year production a of our X.X fourth guidance will day, year. production imply for the range per the quarter full the to flat last

the expect we the completion and On gas the the by fourth natural we market decline given for the these is, withdrawal side, where to contrast winter outlook both our conditions the third a half The could reduction macro so of between second current especially quarters, mind, the during activity sequentially season. capital driven dynamics in during stark believe obviously, markets and everyone, spending top year. of be in

On quarter export third in side, the of likely LNG continued part U.S. demand experiences this that we beginning latter disappoint utilization cargo a will fewer the while resulting for the the levels, summer, to as exports July trough August LNG gradual cancellations. improvement believe the in rates have the mark and in

offset Our winter year-over-year, due gas, we to base power-related coal-to-gas LNG and in case will residential higher as which and a we rates export utilization back significant gas assuming stronger reduced in U.S. increase demand normal would the commercial improvements into prices natural global should the in move for in loss. corresponding winter, weather, demand that burn is anticipate demand any to some expectation related while expect power put we reduction money, switching, this leading

the also from cuts per we is gas which to see production good, Bcf this resulting in sizable driven continued in but steeper-to-cuts potential supply – associated declines the we X structural side, for natural the On winter, expectation the activity basins, only think for in focused only basins, and oil-focused driven over in year-over-year day gas reduction continue production. not by

to production or across than cycles. ongoing in LNG we exports the capital need capital prioritization see shareholders including recovery to disincentivize and the reduction future of in natural prior slower debt economic return and And believe Given on focus either ultimately, be higher more over discipline, will market will production allocation gas capital on much coal-to-gas switching. industry incentivize the to supply of prices growth, any to

protect risks certainly to for in are optimistically against this on remain downside focused while market risk, favorable locks acutely we heading the about cautiously that optimistic hedges setups, years. executing exposed remain management commodity of XXXX natural most gas to a potential the seen in on winter. strategy there one also thesis, for We into While potentially we remaining have risk this to the

deliver plans on from release with XXXX the yesterday, a Mmbtu, lower per – assumptions X% have in our modestly While formulate to on of XX%. NYMEX is roughly we future line program, XXXX $X.XX employed XXXX, yet price can for XX% We and official based similar production highlighted yield a futures. return that free in capital flow we as levels approximately between and capital current cash of a delivering while which

every natural As increase potential, inflection price in the flow in natural NYMEX market gas $XX fact, expected we gas million, XXXX $X.XX previously, reach our if highlighting cash free disclosed winter. is this improvement a of upside does, the to by approximately point

XXXX. flow shareholders, we a capital with flow the anticipate, of of senior disciplined balancing in our XXXX, focus repayment and capital remain a notes significant returning to free we to committed deployment next of expansion on $XXX cash free our allocation in maturing cash between in million year As

and of including per $X.XX return repurchases. supplemented base quarterly returns share be our annually by dividend grounded of dividends and/or Our focus will further $X.XX share capital special or in optimistic capital,

a deliver ability lowest While resiliency, to balance commodity of may strong average record highlighted XXXX on corporate deliver our in maintaining Cabot's the the proud of XXXX, even by flow price positive cash the price since positive cycle. ultimately NYMEX and I while sheet am returns, trough free

in the and was impacts remain an the expansion be to corresponding employed the on will in widespread to We year, deliver our I before Global we than continue for in execute, this about February our optimistic will capital any XXXX. inflection potential more happy return potential plans Pandemic, with and natural Allison, answer on winter return in the of for questions. and which that gas formalized this capital flow, comment, shareholders free cash to of And markets

Operator

We [Operator first from the today come of Please JPMorgan question-and-answer question Chase. Instructions] session. will Arun Jayaram go now begin Our will ahead.

Arun Jayaram

little could for little around bit Maybe a wondering, CapEx of modestly XXXX a your thoughts thoughts on on Dan. you lower more Yeah. us if Good us I color give morning, was give bit that.

Dan Dinges

our the operationally the the modest we front-loaded, indicated our see was spend and in think seeing think what reduction will remainder we're program Well, rigs and and XXXX, program. at we've contracts efficiencies in not our of with crews that frack midst we're as program. XXXX in will we execution going to We of with developed occur what that XXXX in the we also and program have that capital. looking We're negotiations much

Arun Jayaram

Great.

Dan Dinges

to useful a wanted as be now might you if Yes, number ballpark X% a XX% a right number.

Arun Jayaram

it. Got

in this type XXX maybe that? range, like something something So,

Dan Dinges

would Yes, see that that seem would reasonable.

Arun Jayaram

maybe want $XXX cash million you about our if in would see you a did called elaborate call suggest XXXX it. cited Got $XXX $XXX I could comments of million X% yield, outlook which on assuming dividends an some cash flow, the strip, million. obviously on flow free math, to it on your free annual

XX% of desire the at return to there's shareholders. think of cash I flow least company a to free

above what return to we maybe $XXX So, want a could of kind dividend magnitude year? around again good on, shareholders $XXX but million see $XXX let's thoughts that another is million, your cash your is million assume year, suggest next maybe would a to just get number which of

Dan Dinges

record think good Yes, a pretty that we've desire and track -- our return. of we clear is have set is I to what

have we're have going also. of our we care dividend As couched year, XX% cash we debt next flow to to our the back shareholders, take free we of

we bit. what But where also if of our to here I'm the about we is. and forward. return we position it -- some look And We'll off changed cash internally market But our it decision, special talk maintain of look year speculating at would do, we and as talked out and haven't have dividend shareholders. about dividends, macro to would we'll throughout to the we've a elect we little our probably

Arun Jayaram

Great. Dan. Thanks a lot,

Dan Dinges

You bet.

Operator

Brothers. Next ahead. Campbell question of will Jeffrey come Tuohy go from Please

Jeffrey Campbell

Dan. morning, Good

Dan Dinges

Jeff. Good morning

Jeffrey Campbell

and spend, the for to tailwinds implied nat we so in two demand want pricing your And can a what little help improving wondering on views then, may press that with diminishing seems together conservative as do Cabot XXXX? I and more that. was or is it ask discussed quite maintain with lower from release other view the that more probable flattish ideas the cabinet just contrasting these we I one XXXX, probable there first put about said to in one for note preamble, two production less how together in think XXXX the bullish, for was supply gas be

Dan Dinges

XXXX on is still we early. to released read, it's -- February you be. our We've Well, going do, as we as in outlook typically, what or

advantage to program it our turns attractive. stated, $XXX that million. And we're or I a have think same comes have see now do We discipline that market our the our forecast at lower much we -- is at cash able strong, time, that look expectations. clearer to minus the we have have into going nature, and right we in our flow see volumes. to banks. is hopefully, and the a increase set cash of definition and If continued expectation the increases strip LNG what conservative what program, I what are When see deliver great going be at XXXX to be -- but market, shareholders the great we winter continued that conservative the to has that CapEx done, back this is our conservative we our the comfortable free deliver particular now. at commodity XXXX what And is going to what right at we're demand. price with we're think program, by how market to shareholders we'll the a of program that that in setup flow. comfortable we've we ability point-in-time We'll and look plus free in a a for be the And we're will which to CapEx with messaging deal versus time, The then we deliver

Jeffrey Campbell

more too even sounds to or there and if then already the get like just And reading and real that to program a generate goes activity I we that it? way And put we've better free cash. make on we're point, first you're set quick. fair, attractive want words some pricing, I a signals, might don't much into in saying conservative foremost, our we depending to increase maybe And to cash. the am up follow-on. follow going is market free your going but it is up what got And at Is as mouth,

Dan Dinges

have Jeffrey. could said wish did, as well you I as it I

Jeffrey Campbell

a follow-up. And great. I'll Okay, ask

Just of on Atlantic Appalachian And just view in View I XXXX, you the the a pipeline, get the you. macro well? market cancellation your lot want both on Coast the pipeline. Mountain affecting see of that more specific, the as to how Thank nat basis likely completion and maybe gas

Dan Dinges

Thank of seat. Hutton his you, on Jeffrey. Jeff the And edge is

Jeff Hutton

XXX. generation that's It XXX-mile, a how through, project, the states still to morning, develop et But -- like the cost Station supply of were cetera. of that shippers that the of take always gas project. many with there. Good some also in able be tie transport the scheme felt to go specific, Jeffrey. into were to a in There's was case. they'd for bit project more obviously, some down I pipeline high also to went fairly felt optimistic long, And there that we satisfy there's on and the We that does demand. that grand down quite cetera, the because also quite on things But they that's lot of like think the that we but gas-fired lands. that trans on system development, project I think market, et ample in frankly,

area So it actively into initially, somewhat that where there we that too and concerned region. gas. upstream We the even to point still the we're saturate that would that market D.C. think bleed much it marketing was in the would gas today, were

And region. cancellation that for an project optimistic more that so, view a of on frankly, quite of us the pricing gives

Jeffrey Campbell

Okay, we'll great. by That's the And week. see very helpful. Thank you. way, you next

Dan Dinges

Very good.

Operator

from Brian with Please today Our go Singer ahead. Sachs. next is Goldman question

Brian Singer

Good morning. you. Thank

Dan Dinges

Good morning, Brian.

Brian Singer

return I comes? about raised dividend, wanted when more mechanism dividend are talked up a about variable time on follow How shareholders. you of of are more a you cash here the the special repurchase earlier, to dividend versus to to on first thinking but points how share thinking, that codified you special versus that couple

Dan Dinges

socializing that Brian, we of or formulaic dividend we're around not variable have delivery a a internally. dividend. that Yeah, put framework not now – special we have

market made have past, generate incremental those we allows that seen in see in when you've us our the as near-term we us, the x As cash. to decisions the in feel similar to front market. out about We free We've comfortable the of buybacks. support of amount

that we're in and cases back delivering some comfortable of So portion it of shareholders. all certain to

formula sorry have you So, know, we but I'm to gotten I'm not we not specific on have formula the – internally. that not

Brian Singer

up particularly is what Thank Understood. sectors? that gas demand, are on that domestic market industrial you and in-basin my expectations what And your your also the to you. sets give outlook more for us the view latest power how gas can then regards on the for follow is U.S. demand, broadly with and from

Dan Dinges

credits. is demand I and project as are and one that one money, employ think, an spending demand driving large a and system. is now in-basin in over the this and would demand manufacturing let most impetus, in while, Cabot. like catalysts of amount regard. out for opportunity a that Yeah, to can attention us. thoughts our location have XX little about natural and of Jeff the projects. business because it dollars receive deal PA, amount of the to allocate Northeast comment governor's time development it his projects next books is, will Brian, projects had to And group talk the going that with a tax focus four that a realizations working spend want I'm had discussions a opportunity we been the least on but of gathering more projects, area demand on of the a or Pennsylvania credits We – the And turn bring I'll signature. to in-basin x and is that millions to agreement is it tailgate gas make is in-basin That now great of bit to of recent at incremental of of there We has have a tax tremendous state the to then look up x an for with idea years they for this a that Jeff, hundreds of I people, then we it we of projects,

Jeff Hutton

State corner, of neighborhood quite Hey over Brian. PA has a X.X The good of recap. look morning quick -- years, Pennsylvania a the built up of and the Bcf day from lot somewhere in in a Pennsylvania, Northeast the gas bit In-basin last are load across entire the been new four, utilizing of five demand spread or picked built being just as And are the have that you of that natural demand. projects area. a

a have developed in to There's already the it's and local So, announce in amount loads activity specifically, But good this huge of nothing our that we've gas with good, with people. obviously, new not Obviously, project and rail, year-round are the past, technology throughout And or different terrain for we manufacturing Northeast. locations sizes development today. and a continue acreage different number associations Cabot-linked some whether and unique located sites projects others. that and with we've and all Northeast, market talked a with water, some a so identified in supply. where huge industries county with the including are that been very amount power of it's to about to or we associations talk markets with region, of with have

toward, currently of deals, of we And day up really of have nature Bcf -- happy their some a there. most X.X that definitive, process. it's those long-term locations. we have So, ongoing because course, we're some ideas are working we're in duration with low of the an but found nothing We that

Brian Singer

Great. Thank you.

Dan Dinges

Brian. Thanks

Operator

Our Please of next from question ahead. go Mariani will Leo come KeyBanc.

Leo Mariani

was a to of risk little management/hedging follow-up strategy. more I guys. hoping bit Hey the kind on

bullish we XXX, to XXXX not certainly which seems be little think As economics like in here sit a and Cabot's outstanding. like kind some very from view gas point. mean try you're place away winter warm is as today, in we in offering But where to put this macro. I kind one of robust today your Certainly, it curve some of call protect futures always potential maybe downside challenges looks or on a to of recognize would where sit guys bit Why of north you that compared a know, market. structure at I price the

So, have on of any great. thoughts you would that kind be

Dan Dinges

discussion north market. certainly and our $XXX today. as It of of is see out that actually the to in say, the regularly downside million a committee internally the our intent XXXX have We hedge macro we is we see with price there you the mitigate,

We are once made amongst the $XXX the downside, We yes, been XXXX decision We intent risk of is type so the committee our would surprised. past think with very the financial remarks And the well all market. disappointed at think of our to it in can we're market. we that I program pleasantly recent appropriately as more And, have participate that supportive of. do in that that some to in hedge that. the in do my million. are to make vehicles, the than points that we'll past, fundamental deliver of a that aware underpinning It we do constructive down, disappointed and the there mentioned go fully

now. tell do participate can't every And forward plan pleased like, with we look when, hedge is market to So I advance, right the something, day. we in we you you to the but it do Leo, we're at looking in thinking again, are, where we're market.

Leo Mariani

if to what conservative you to on we down production just your little around in there? was I Okay. know is quarter saw of, and That's XXXX. to production up your bit guess be in kind strong an But, then a versus that X% the I a way. just sort pick great of wanted being year-over-year I early I guys maybe of on where fourth a year understand that end it's due think color. implies outlook. guess, levels. comments XXXX and regarding decline fracking would year dynamic gas Just the you next my flattish certainly know XXXX, follow-up of about shape next winter trying this why you'd math, said guidance not year. up down from as to similar versus in kind to a lack XQ I

Dan Dinges

granular cadence, capital I'm the now, that's different winter is, -- comfortable – now, macro overall, the we just flat and We're of look. just market to do sorry. things, try the it's expectations the a some But, in right market I'm it outlook you fairly we of be right with being going pads with and to manage Leo, how our number give cadence able XXXX the it's the Yeah. on quarter-to-quarter to the cadence, lower have, the what season, to to is size result a going of and is

the and supply down right nailed XXXX, gas would demand say say, look out October now even higher the quarters. you market out then not you have the lower be I a in at gas, if that, market. between that and had ought now, the if We right you in winter, running One $X.XX the able if out right might this to say October. look this through look that, $X.XX period And April partially $X.XX we summer, cadence thing the, to about in the to we're for be April exactly about

So $X of there time. almost effect, difference that an during is period

a is things still are we of look we – still So those the going have discussion the some internally. that at. But cadence

Leo Mariani

you. Thank color. great That’s Okay.

Operator

Charles go come Please Johnson will Rice. question ahead. from Meade next of Our

Charles Meade

your to there. Dan and morning, you team Good

Dan Dinges

Charles. Hello,

Charles Meade

wanted into isn't And quarter, EURs evolution you give that a point update talking were us views. the really I on is. but if Marcellus it, you dove Upper XX% the Marcellus about you I could guys the about Hey, made something in this Dan, what – your think of to I of an really of wondered time were Lower this – your we the last guys

And you half view that And you're of some testing that zone update this any on wondering or in if for us more extensive back evolved has have an so if give doing either XXXX? just iterating in plans if or anymore. year I'm could you zone, if – that in on the

Dan Dinges

Yes. And some drilled is we comparison have though, this XX%. The EUR, And in wells upper number lower XX-plus that's more the between year. our. not percent for Charles,

Jeff Hutton

been Always case. the

Dan Dinges

longer always the it year, been different that's been and grainier in our on different we've field that Yes, and field. wells the on material, because seen in the have And our type case. in risk pads type have upper as is and curve that's there the running But that we to But wells couple not the actually the we're collectively, we more is wells recently. the on on curve our slightly on that I'm – locations tight this have come the above, collectively, three drilled uppers have collectively, the drilled get going been in wells for than out other that what upper. the curve using

say, You want to Steve?

Steve Lindeman

Yes.

those when Dan's that of they've what that outperforming currently, for curve on basically, in saying but So would for they're for our be what period time, been a look area. type the is you short at projection pads

results. very with we're those pleased So

Charles Meade

comments a about would long taking for is the That's looking with case to of on me recognize that I maybe out. anything any misremembered it. is Got but the this this Yes. for. color a Dan, I guys? was that, – AG I thank that you – I you guess and there was you'd make you earlier kind Pennsylvania year the shot, uncorked but of bit miscalibrated care

Dan Dinges

now the Well, as and through a investigations. the of have AG AG by their recognized companies number been

you provided matters staff As Cabot directly. they disputed addressing is are, the facts we're and of – cooperating course, AG, data with that his and are the allegations the charges have with aware but nonetheless,

ever Pennsylvania. methane certainly Cabot's all telling the of in there the to rock And the greenfield we there, When water It's And there. gas was oil there had gas natural systems a are drilling occurring areas story. was it up the up is up side production. place, taken gas Northeast industry but there that prior there. the undisputed and up no naturally going natural -- operation, was We of prior no up in moved in

operations in continue do to practices be always able its leader environment that and to all this continue that best for stakeholders. to resolve AG, with work be is we'll So to regard. a We protect intend we're positive our to the and employing matter

Charles Meade

color, for that Thanks Dan.

Dan Dinges

Thanks Charles.

Operator

Our Silverstein come next question ahead. today from Josh go of Wolfe Please Research. will

Josh Silverstein

Yeah. Thanks. guys. morning Good

upper Just a on question and about the the before Marcellus. follow-up lower

two inventory. be about split versus how talked that the between price right that of You deck And wanted what upper would decades just I to see using? you lower? now could the at

Dan Dinges

we've shown production going shown deck -- in On our past, in out our cadence, at drill have we drilling the period. and look if you how laid the XXXX out we've our And into long-term program. a

we part the the then have we XXXX We upper have out Marcellus into into out lower decade go XXXX drilling. move And into subsequent to of latter that, the And our period. drilling with that drilling.

Josh Silverstein

it. Got

lower of now, right of kind kind lease it's cadence? maintenance years the for XX it’s So

Dan Dinges

It's decade, it XXXX yeah. years, less, end than but out goes John, slightly XX of towards the the

Josh Silverstein

you. Got

cadence. Okay. And then that just maybe talking about maintenance

One that wanted be the it was benefits end things it decline lower of of where actually you this might at growing were last see your lower the I where and to staying can of end at the rate. you this of level to that base hold of if you next at kind at the And where be might end flat just year? think year? of year, not

Dan Dinges

Yeah.

towards able is And I be of don't : to have Lindeman as might decline reserves XX% our to the right We our XX%. rate decline, at And have the Steve of looked cadence -- the end he's now towards our get Right. number. XXXX. me

XX% right now, XX% kind to the range. in Dan said, of So we're what like – running

you out we'll years XX% or As add XX% the probably go and to XX%, in -- four range. running three the base, be

Josh Silverstein

Thanks Got Understood. guys. it.

Operator

ahead. Simmons. Our Harrison Kashy come from next will Please question with go today

Kashy Harrison

you Good for morning and taking thank questions. my

Dan Dinges

bet. You

Kashy Harrison

cash of were hedge to I And free about at about gains. of flow million. that your that implied $X.XX I earlier discussed should was guys your then, it in billion call, X% like $X.X about cash the So It than at much you CapEx But get the to million. I yield Dan, in $XXX looking math XXXX $XXX had looks was know you just million do financials. given there higher $XXX flow – at we simple be feels X% able the at highlighted would took million. you $X.XX if like billion. XXXX discretionary

guess conservatism And question taxes as expansion cash or basis on or higher-priced we is a toward income your is, environment? be maybe you look my part, so about I that thinking should

Dan Dinges

Yes. to to pitch the Matt. going I'm ball

Matt Kerin

Hey, tax cash tax Kashy, that's also benefit last we had it it you significantly et – cetera. – nailed because with yeah, piece. of so nailed the higher reform, year, add Obviously, deferred tax you higher I of think the back,

So as you add, see know. same the now our I'd benefits that AMT, And our guide we there's in of tax utilization well, those going the to not all course, as future. we've of maximized move in always forward and NOLs just we're as conservatism

Kashy Harrison

for seems over or, just look as of spending, helpful. high-class capital at budget, think you proportion Very the you but well targeted of guess your was your capital about completed the spending I it I as looking guys spent it. year. wells then that And your you've at spending, capital Got you XX% problems. this have under like

seeing full was, improvements? so to some sort this – I is read-through timing you And follow-up year cost is or or anything so efficiencies guys question more there to of the for implications some budget, related? And my guess just are

Dan Dinges

It's $XXX as efficiencies our noise now. conservative the be million a CapEx. in we We could position, in right the but decided thought deliver, and have was wanted midyear It least maintain might we We to appropriate. program. in our we release that

Kashy Harrison

about the know the I Got very two one the zones? difference in the helpful. how questions guys wondering, the follow-up it. more That's XX% on costs Have I always some well if just talked you XX% Marcellus. well sneak and we've think about just the could front. upper on of Upper And between lower just of in just talked was ever the to I earlier performance on about –

Dan Dinges

But more , talked able that has passed on look a particularly It the within to been recently – that the case – has it development the we've when of to haven't drill is And the really about Scott, long-winded at my intent our regarding Marcellus. too I indirectly, we of laterals with we've Upper for told Marcellus, our our the talked Marcellus have not or in at -- units. but piece really drill most look on average answers. than you across you Upper to lay long the this answer, It's can out Marcellus, Lower development to part. comments We made me paper Marcellus. how make full we you longer full program. Upper Upper can been about Well, legislation sometimes laterals sticks blank of and the you longer intend with Marcellus for maybe a the

lateral say, -- those the -- type their is laterals, the in cost actually or our than the of $XXX -- in a drill longer drilling laterals. laterals, XX,XXX the XX,XXX efficiencies another in cost on Upper longer our see we that -- efficiencies look drilling development of kind we in what foot Marcellus, loads and our the efficiencies the also -- our over Lower, foot there's and inherent first in longer excuse laterals the a and $XXX in if our in about that in Lower There's per our per foot. foot slightly this in our Lower, you Cabot of second thing even that in year. drill currently, that longer and laterals of even With XX,XXX foot we XX,XXX of the type have talking in completion we or we and the some at in those in the cost me, I'm as of Lower -- have laterals, foot even cost quarter cost represent cost per -- With

facilities again, is load pad do all completions. construction costs. That and -- we for have is, are We in sites thing what associated think in efficient the our we and in all-in very us other with into our we also cost that load we all the cost, those our

pounds other X,XXX less completions. proppant have of companies in We use I use proppant. might know our we And some versus,

to gas like dialed for have cost of their is have we we our think going efficient. less coming proppant slightly than very do but that in, So, wells amount we recipe, maybe is be ours, of the out in so we and our

we our to roads, the would take considerably We some even of equipment, hope might in just to pad be to less return the Lower, we development -- Upper mentioning, a including be think reuse going profile development good the because extremely be, so comparison it of sites. of cost going Upper of So, profile. overall, our though what a of basis use Marcellus, I'm there on reuse of an attached is is to return the -- XX%-plus

Kashy Harrison

Thanks color. that. all excellent That's for

Operator

to conclude will like At and remarks. session. I'd back to any closing time, conference this Ladies Dan turn our gentlemen, this over the question-and-answer Dinges for

Dan Dinges

proud head you numbers, day been group. say the Allison. our have pandemic. work would but have girls to And Pittsburgh have environment. out Many program and I'm of just in of in you, to They again field work. we've going every And difficult their and office very have corporate Cabot, even every single the those thanks again, of do dedicated there and stay-at-home I as day out of the field been there very because see to operators gratitude can Thank our up to our team. gotten this honored guys this those to deliver and like of through though shareholders But on headquarters this to the able also some the by Cabot's out been once

forward you. thanks So, next Thank attention. to for call. the quarter's again Look

Operator

has conference and now you The lines. now you presentation, disconnect your concluded. We attending thank today's for may

Coterra Energy (CTRA) 31 Jul 202020 Q2 Earnings call transcript