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FANG Diamondback Energy

Participants
Adam Lawlis Vice President of Investor Relations
Travis Stice Chief Executive Officer
Kaes Van't Hof Chief Financial Officer
Brian Singer Goldman Sachs
Derrick Whitfield Stifel
Gail Nicholson Stephens
Neal Dingman SunTrust Robinson Humphrey
Scott Gruber Citigroup
Scott Hanold RBC Capital Markets
David Deckelbaum Cowen
Jeff Grampp Northland Securities
Asit Sen Bank of America Merrill Lynch
Charles Meade Johnson Rice & Company
Richard Tullis Capital One Southcoast
Michael Hall Heikkinen Energy Advisors
Call transcript
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Operator

Good day, ladies and gentlemen and welcome to the Diamondback Energy First Quarter 2020 Earnings Conference Call. At this time, all participant lines are in a listen-only mode. After the speakers presentation there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] And as a reminder, this conference is being recorded.

to President, host Investor like Adam today's now Vice Lawlis, Relations. would introduce for your conference, I Sir, you may begin.

Adam Lawlis

Thank you, first call. Energy's to welcome Kurt. Good quarter morning, XXXX and Diamondback conference

presentation, will Representing website. today CFO. are and an we on CEO; Diamondback today Stice, Van't call be found our updated During investor Kaes which Travis can Diamondback’s reference Hof,

from differ caution of these can filings Forward-Looking could you concerning of are and the forward-looking Company's Company's to this call statements conference those relating performance results SEC. factors the During actual future condition, that participants operations, materially results that Statements businesses. factors. indicated due be these variety the objectives, the in may We found in to make certain a plans, with Information financial

to will release non-GAAP the found we reconciliations with can reference GAAP earnings in our addition, The make appropriate afternoon. measures. measures be yesterday certain issued In

over Stice. turn I Travis to now the will call

Travis Stice

Diamondback’s you, to Thank earnings and call. Adam, welcome first quarter

get we like we affected I would prayers pandemic. preserve the perseverance the all unprecedented is of the far XXXX for strength a thoughts cycle. to action our evident are The to this and Coronavirus in started, decisive minute by presented those extend have first so taken to Before to challenges our in take in

honestly organization that circumstances. business been been almost extraordinarily working can given now And has the I say now two has Our from home months. for well performed

experiencing to the commodity prepare program the quickly today. changing Diamondback reacted capital to are in our weaknesses have teams time and we price and real Our rapidly landscape adjusted almost operating for

the confident owners you our where and Company we and how of be of organization. proud employees in as we live our Crisis And have witnessed revealing and supporting way responded this have characters have our of communities will work. the stockholders across that I'm a

people. exceptionally of an and talented have We organization motivated

the oil we organization or XX% to Diamondback quarter-over-quarter of and was the and oil X% highest machine in grew immediately operated realization operations two commodity wells before activity returned as years. efficiently all quarter. completion ceased production We in production unhedged our averaged XX Turning quarter in first March. weakened executing prices almost WCI oil to

complete XXX of quarter, well year. over the XX% with our XX only little over continuous and first XXXX running expected completion the planned with crews of of of to capital operations was maintained in through the eight quarter second [indiscernible] purpose our million the for a slow in completions count than less for XXXX, We the XX% rigs quarter. Capital fourth and operations budget most original or spend of

rig crews immediate existing working commodity as quickly When in dropped month, in of down prices early as we paying are termination dropped, our all fees our completion rig per and without took count action possible and contracts.

will today, are down we we the eight running running While enter quarter rigs XX beginning running exit over from the year. May rigs of third and XX the XX%

schedule to means XXXX. XXX We fourth rigs, count reduction completion exit This over our with further with also quarter combined seven rig reduce ducts. we to the running with ability the into current enter will XXXX plan

over exiting crew XXX case completion is program, five which standard our This three for required things as to will base working duct see what today. program a as inventory ducts is above we be XXXX

give forward years, will navigate capital of couple overall outlook. over the benefit be drag and on be this efficiency may capital in us XXXX a in and significant a to flexibility uncertain efficiency as While XXXX, particularly it we next

half and of the the flow second through cash we a will the back is of reduction our see start CapEx cash statement and at number, to activity our quarter XXXX. Because benefit end

of months in later two rule cash reflected flow are statement. thumb, activity a As reductions today

month in fluctuations price realized commodity the in they While are which occur.

weighted be began the into will the our toward March second significant in As reductions quarter, the the half and to spend of front activity reflect third quarter. that truly with XXXX a continued beginning result, CapEx

Diamondback in the and the of oil oil curtailing risk contracts XX% the is gross mill. forward operating uncertainty realized to month, the production, low unhedged price this to prices about XX% for due

differentials heading the much producing extremely off The in the month $XX declining of the at low With possible over role WTI. prices. benefit set already into realized of risk outweighs prices unhedged WTI as into further as

in is both for without materially monetize curtailed. the have production therefore of XXX% can curtailments, the including nearly production hedged oil impacting fact flow in when money protection, We production before hedges expected and basis cash

focused slow production we spend curtail costs not contracts, so. production, we need do operating and variable In do significant underline where to marketing assessing dollars where on fixed and to to choosing to

We will nominate we for as meaningful we accordingly. update to And curtailments months June accelerate, production our prepare the and continue future or prices will to investors monitor ahead. should to plan persist

of plan. Looking ahead on stay flexible in completion crews there how bring forward work to due making in trying to work. crews back are half decision. this full commodity our see curve business back need second And uncertainty to we before volatility the we to stability get year, some the both month and in which We is prices, the to in many significant the

on down maturity to due in With due suspension spending, we and a million retain expect five quarter and the focus protection interim, as of possible. liquidity debt. structure to first next billion will September our and X.X our debt buyback have the our liquidity as with maturity In in we the we liquidity is preserve of continue only one reduction program, can what maximize cost XXX XXXX. which hedge cash current much pay years, term ended We to control, and

interest our and our Our times. has and primary uncertain decided on equity of holders maintain our dividends retaining Board dividends Paying outlook. current dividend expense, Directors our return priorities based our through the capitals our remains people of paying for to remain board the these the

of this to environment price structure the our downturn. leading low for interest Viper prove industry midstream operate hedge times. To benefit oil finish, G&A, cash Low to uncertain strong book, will leverage, in cost and expense, low through operate to and through them Rattler longer allow will Diamondback is contracts these full a effectively differentiator a prepared lower a and be

With these open Operator, comments questions. the line for please complete. now

Operator

[Operator Brian line Sachs. Instructions] Singer with first And you. the Thank from of Goldman comes our question

Brian Singer

Thank free you. good follow-up comment I wanted the to end morning. flow. on the of to the and regard with towards cash there use cash

In you due? about free cash? either million builds bringing pay a You you the for cushion dividends variable talked free where where buyback Do spending coming cash think coming $XXX back flow buyback, million Or you $XXX do cash future got the the debt. year. beyond scenario the above next that due to or your about or gets debt flow that a you distributions? down you and are hold still of about cash cash use thinking debt considering How have

Travis Stice

options we quarters of into as and those to Well, certainly us. multiple year that next still look is all are available out

- cash, our an of also to at to primarily terms cash allocate we we way the form we through full intention suspension we we continue the as that don't will program. a in board highlighted so, In of the be announced of level - a have buyback dividend program. excess judicious share But afford the and

Brian Singer

see do benefits you to you goal, Great, could wondered then is as think are cyclical productivity here either potential the and seeing thanks. or you achieving reductions year. on downside of to from what impacts, year, side, prices with on versus of there the are would to secular versus percent if to the on I talk this what you learning regard side this follow-up speak cost secular cyclical that you cost And kind my And cost you the if production where extend the rebound?

Travis Stice

the just we have cyclicality foot couple of think savings of out taken Delaware the we and permanent the And and at if particularly those a $XXX look quarters, of regardless business. our I the of Well, DC basin, are e-components. last over a

side, probably XX. basin out taken again, permanent. going have midland also are the On be of XX a we lot made those to or And

and prices the understand recover, require is future, of begin a service do from partners sheets will the cyclical business and balance that other side know of to their business really operators more that we nature consideration that side, on to that in are the there. repair our commodity when have and We in bind, our we will

do perspective, the planning know was is smaller don't to that we rate a the went going XXXX getting XXXX. of it relative is when the that and of from We change think we last occur. through But rate in forward, just going where this time to change,

our still our permanent about intent those that that past the development is organization's elements the But make them nature and will prosecuting we go actually way find cyclical to in plan. it survive

XXXX. make today, But are then savings. So to and those predict? to what me ask It percent, likely and harder lot that trying you identify still at when is XXXX smaller is we permanent everyday

Brian Singer

Thank you. Great.

Operator

you. Thank question Stifel. a comes from our with next And Whitfield of line Derrick

open. now is line Your

Derrick Whitfield

morning Thanks. all. Good

Travis Stice

Good morning.

Derrick Whitfield

Perhaps with the outlook. for guidance providing to challenges current quarterly XXXX in environment. Travis of Kaes, I certainly or appreciate your regard the

broadly Assuming back previous less the relatively curtail to in returning is online? guidance with plan capital remains associated reasonable rate timing outline, assume exit place, it small the effects production

Travis Stice

guidance, thank Derek, back in are Yes. exit year. to pending, we the half think work That you. sticking back getting the is to of that fair, rate I

fall, in then then come wells, wells, start if curtailed we curtailed the volumes to and first new all we of if think that number before or completing and is into achievable. completing back, summer seem I late the volumes back come certainly start

and that update to give Gap] market, back month the are as be data continue we half, the we and curtailed times seeing. or last have, a our return the to latest and lock [Audio you in delay work four

Derrick Whitfield

have Thanks the responsive guys very in helpful and you quite environment. been

question, or that that voluntary my you to considerations are second XX% your discussed any the that appreciate there well. ability marketing limit May, compare as volumes for certainly that beyond limitations to on level? With So XX% would curtailments technical focusing

Travis Stice

No.

our day triggers. barrels any We XXX,XXX being the first XXX,XXX oil a are commitments And far in today. gross pay barrels or over a away from marketing are commitments quarter. day very true of take a about produced still little We

cash are from where marketing away we curtailing. curtailing in we behind of triggering are the those. anything And, are So costs still barrels was associated far we that thought with contracts pretty secondary the the the operating

Derrick Whitfield

challenging Thanks guys. Very well done in this environment.

Travis Stice

you. Thank

Operator

Thank you. Gail Stephens. from the Nicholson next And of with comes our line question

now open. is line Your

Gail Nicholson

everybody. morning Good

we forward? to on LOE at then think have should thoughts any work And do a to have normal if know an of you adjustment productivity? you about In activity effect looking making what an how And workover Just future wells going comprise? environments, workover do percent workover over.

Travis Stice

Yes.

part So reduced XX, XX that maybe Gail, that curtailments typically number on right through and we just basis, is hits we effects now going workover round five. routine this some maintenance than are than less of days, that less daily we doing are XX, to on a even

the in least wells of to as at repair month So or are have them. problems we and out May fail now electing, go

and cost As having not shut-in don't go failed those impacted. have very And a but But of that months where time, cost, in it that of long those as will Yet, be worried is we multiple long about we pushed months, the to as be will back you thinking about in but now. types remediate period that multiple, wells out for months. I'm know wells. scenario, shouldn't there about we talking be productivity are several a are

Gail Nicholson

how curious on Okay, Brent change color regarding about MEH great. I'm an a regarding contract based then just talk just pieces the you Slide Slide really contracts. could X? if I the X appreciate And and But Midland those

Travis Stice

for we slide the into are are and so, May. month, been fixed while Gail, going a role contracts, will say a its show significantly in put less Yes contract dependent, throughout already to had to our a smaller it thinking I flat Brent have the Brent how Brent [indiscernible] price about to speak role And it of number. will so is WTI based show majority we contained the curtailing we role is Diamondback because the wanted but, contracts so, differentials all supposed investors been volumes. be we components,

Gail Nicholson

you. Okay. Great. Thank

Travis Stice

Thank you Gail.

Operator

SunTrust. comes line with Neal from you. a of our Thank Dingmann next And question

is line Your opened. now

Neal Dingman

view I growth you ramp and really first centers production for how the hope three your after how there guide on My suspended, future streams gas of in you each way, would oil certain growth? or and how to but near-term versus the another maybe all rate specifically growth the been you timing is do you and know Well got if production is I three your well. ask question view do out D&C of you stream the to natural view curtailed

Travis Stice

decline the Yes production in BOE your the oil with mid-XXs stream production overall, I declining Neal. we our base with the faster decline framed No in to BOEs going question base than our low-XXs and oil think decline percentages.

given get are high So, there overall, combat that today, decline, to oil activity. if valid. are But that to out those to Midland decline we uncertainty base we try hopeful back basin we percentage that numbers or some I'm have do think work, going still I the on

Neal Dingman

details. second is That question just focuses And really Yes. on great then my cost.

You you just wondering, to do already of view this cost you given well that in forward touched the are to? of to think know or continue case down these as a certainly or of kind I group, speak squeeze down, to Midland when I'm margins and Is out cost how going foot. earlier. think be cost you room even well you I in you'll bit per for you XXX Travis XXX leaders cost, the what cash like on XXX more just is little how all there what a sort

Travis Stice

Yes.

things a move it forever. on little is get XXXX lot question certainly to that And on elements that. it two the that we well the answered work cost like previous cycle. change There XXXX than on permanent emphasized the as completely I the loading those those TD and think can smaller cost through a went I as was all about and Look, faster, when bit permanent making of faster, we make of are I things is ways it is, there in now savings. rate is

of some, recalibrated have on partners been in this anything of May we like point, is feel offer up those side, have business and probably to concessions, going the our do has majority than in as month service be Whether offered seen. the there beyond to continue industry the April the we but quicker ever

Kaes Van’t Hof

down, here. into of cash to G&A LOE and down pieces dig continues we Again bit, I productions hurt bit. so to is come to pennies to cost But the that down keep nickels going for LOE on little are a you going fees, little are if to other is cash that percent the coming best-in-class revenue, the cost a fighting think still tax go stay going of flattish, some piece given and should we try

Travis Stice

detail have we improvements that our a are I reasons And and what information lot about know you we is Neal, to can updated and why of one last recognize as deck, to pointed talking think and the questions with answer a that the times Kaes try as that we much month four in quarter-over-quarter the and in important got it cost, have market that half. we the as of we

It questions, investors is because were and our company, ever. when times more that own is the transparency than uncertain have important

we is not had of a of pass our of free guidance, culture transparency. full even have just So, though part it might

that only investment can we We you do transparent. the so within are going can best financial be and is to to can rules tell you that everything of very disclosure, make the decisions you that very, that the we can way

or through transparency tend is for the or it in follow is future. times we these the a Q&A And into prepared energy, and of to dial needed back tenants remarks and that background, whether so uncertain in that

Neal Dingman

guys. Now That details the I appreciate certainly all Thanks, Travis. helps.

Travis Stice

You bet. Neal. Thanks

Operator

question And Scott you. Thank next from with comes line Gruber the our Citigroup. of

line is Your open. now

Scott Gruber

Yes. morning. Good

Travis Stice

morning, Scott. Good

Scott Gruber

probably not focusing HBP So improved before best downturn, as obviously you needs. only over there which your but expectation costs the on minerals XXXX, was shifted further well and of productivity also obviously position the even infrastructure course and economics, fell the rigs, would drilling average well and on well includes that productivity

a the can go order it color and previously productivity as expected forward should here magnitude? an color trend, from any on you So of some basis on improve, provide

Travis Stice

same doing. better current complete productivity in shifting in of also next is the that well Well, in looks you are there improved the versus the prior that productivity two projects one And macro versus that a month you way are is the is, month if is well, the you because sense, ways months. on there productivity mix

and also were highlighting within to focusing we of Delaware the from shift the in communication limited Basin towards we having dollars. most earlier Midland sub where not ownerships so more had Viper infrastructure any, or our And then spend what our Basin the mineral on was

to going So, migrates effect side. program live I've the answered as changes think course we still ones see the on year there to is more couple And a current. I we to that things are as that room our see still through that that making make we Basin due who into those have the doing the than done the are this better in things of and as Midland of are now times, past,

Scott Gruber

it me. Got back. for it. Thank I turn appreciate it That color. will is I the you.

Travis Stice

add, me for the sector do. service is, the intend be I sector. about let a where think to I just And their like certainly don't finances when they don't service you understand spokesperson

to benefit, really to not whether down it shareholders. And is at costs, so, they near-term and reduce or the continue to with least that

that best do leaning organization on every the how Those are of partners answered service really asked what nature on is. better that What side. the can business of we our is things questions into and side for our cyclical day, regardless are I'm

Scott Gruber

Appreciate the color

Operator

Thank RBC comes our you. Markets. Hanold Scott with And next line the from of Capital question

line Your open. now is

Scott Hanold

for all colors Yes, thanks. so Thanks far. the

through interesting pretty Can XXXX. the of, sense in, you ducts duct, cost give comment an the carrying XXX a you would XXXX that was into given be intentional that process the guys On just wanted to could. coming to rig some, want structure your contracts the just you when Was powder or dry reactivate didn’t complete of enough? wells where wells were down it and you somewhat

how and sense that balance this activity give us of, can you you decisions year? through So, a

Travis Stice

about while we ducts, you of contracts rig in bull we the and on didn't out it XXXX, mean, termination of rigs definitely bear every of a combination dollar carrying number all really a Scott case. fees. want three I off But large are year, wind and had counts and both counts pay to is also and early really covered those think we the Yes, case when this those.

In bunch for can have of the on quickly high produce. we bull case, a if we get in paid to production that quality the we bring will we really ducts commodity XXXX

bad, of On like in get at maintenance many we the do drill we can can by - XXXX on basis. wells bear for extremely whatever forward a case, high and these if if rate all probably we feel paid that then we via completing return it gets any just that won't cost

Scott Hanold

could that what are look decisions, think the the those really just ducts you like do So the into that bull bull much my really that of XXXX be as what maintenance capital did thoughts the and impact an quickly how ducts, case, have? about you also on triggers made on case those

Travis Stice

than have price next is that what likely extremes, like we going I'm saying predict bull are XXXX, to not year. predict, we necessarily oil even what Well, a to are is trying both could never what outcomes rather and off cover to in tried do that to trying case looks occur, we be

In of on the terms CapEx? duct maintenance impact

Kaes Van’t Hof

we keep a year-over-year flat About with a XXXXabout in than ago, rate came less exit could out production capital number. XX% month saying Scott, Yes. to XXXX.

I think are or stands. XX assumes, that XX down probably ducts. number that still you And drawing

options we about three that base have And you case we XX XXX extra is, to completion crews. completion to our ducts crew, somewhere working have thumb the ducts with. range of are access think in had to at to I get year-end in of XXXX, each so going for rule the have today, five if

Scott Hanold

what a Just ducts? be to thinking more signal next specific, wasn’t just year? getting bit guess in you into dipping like of those I all about Yes. and what it more think be little case to asked price particular, to have bull price does about I what start the active And

Travis Stice

have do went again, deferred have today, XXs, that, is high right, first that the but assuming brain would about we the a to are factors there we Well or activities, back then lot prices thing in production is XXs. low where have you your talk on and got to increased to of into

before to take next a back activity in we things signal in as in we even going half or year come are market Before our out the these on way. to all well. again, what working we year kind aggressive, of non-aggressive going plans in a back But an of consideration are into of or this

Scott Hanold

Fair enough. Okay. Thank you.

Operator

comes with And you. from of line a Deckelbaum Cowen. next Thank our David question

Your now line is open.

David Deckelbaum

the Good morning today. thanks time guys, for

Travis Stice

You David. bet,

David Deckelbaum

a to flat you I program. guide many bit maintenance little was theoretical to you the are XXXX? needing line XX that hold exit more the just current hoping on division color wells maybe turn to could have How in or being shed able in

Kaes Van’t Hof

interest Probably based work we wells today side or David. or very XXX, wells each and we or just heavy pretty going XX/XX we to and XX/XX and are in basin Plus the infrastructure drilling completed on capital that, required in Midland probably the on high of side. Midland minus areas about basin just basin are on be the little XX where XX Midland have mineral what

David Deckelbaum

and excited the Appreciate guess seeing, but we improved I in I then do us the we the your granted, June. up away, are see What guidance balancing? you kind several are is to shaping how weeks What you if said, for currently? it June, And June we How right are are update And on Price see do with you on I to get up driven. could how then signals hedged thoughts One, the market have this just back are you basin that. changes. now? your obviously in the I do know bit economically these and looking curtailments. shaping comments know side? curtailments something of need just wanted to you

Travis Stice

side, dip looking Midland and to that trading Well, WTI premium the for honest. well, premium at to top on for little recently negative at being be being significantly June want less of side If a the in on you a dips know well a WTI. significantly, you trading to better WTL the

two we cash sit we $XX nominations here are, looking at thought exciting, in cost but would be our for due I June never today, think I have weeks. So as we and

for it better perspective it June from May. looks contract we in a certainly the did than As today sit month

David Deckelbaum

just you wells Yes, XXXX. right now? guess say plus thinking I curtailed? one, I one I could are Or being curtailed XXX wells overall Delaware, about quick many just If can have another now, of the what curtail how Midlands, percentage of that are for guess the logistics have in the volumes you in cheers about wells those being X,XXX%

Kaes Van’t Hof

total, just say would XXX are of I about the over two-thirds and Yes, Delaware. those in

so on And we on, because are really what curtail, we having not shut focused dollars focused these in really the to spend well term in. and shutting and we wells

are just We trying were in than they to curtail where wealth and limit to the cash producing April really, outflow March. and lower level a

David Deckelbaum

the color Thanks for guys.

Travis Stice

Thanks. You bet.

Operator

Thank you. line And question comes with our from Grampp next Northland Jeff Markets. of Capital

Your now is line open.

Jeff Grampp

question, was bit environment? quite Are reevaluating, oil God wells kind - costs as with a optimal price and far and I the maybe months. the service maybe well cost or several commodity pricing obviously a over be environment design how philosophical changed guys internally completion curious you as spacing guys techniques discussing and morning. last today's an could what of have on both you

Travis Stice

together. Yes, have stack spacing never those we that, they and changed to been that been have part really almost with closely tightly that our five things we for I are certainly years, wells thing have haven't ever been but one drill and of assumptions now when or pleased that validated is too are examining,

can is out, a assumptions So, you that. that, now spread follow we our auditors the water the have right have but validated we the capitalize review been, on of rule acceleration could should the pleased closer lower with price, and balance have to we struck been, because always higher reserve thumb you seem lot the our years but the price, for multiple spacing been put that technical the or wells oil and spaces, of has your you

have in new the reservoirs. but these and we we general well spacing, how them zones, how very instances, tightened might count never we of sense, locations on developed have develop So and we even increased maybe been have in conservative we then some slightly in really a some up Delaware, the

it always that. engineering And rock geology and Jeff a we we is have, scientists the tell are they rocks extract I near can and at hydrocarbons the everything well do look volume side, tweaking you we to trying When are stimulated from key. bores always, and the completion these with can most that scientists you to was

we progress, So at that have promise get while just a That I and we can never can the spacing, And evolving. you. in change, well. this will and look is constant to down completing work always

Jeff Grampp

Understood. if operating And I kind here and housekeeping are of real those more or the have you then time about The kind to certain building one weighted call times decks versus focused? in couple a in that maybe of may. Are talked already. of of it guys we areas Midland Delaware

Kaes Van’t Hof

It really and work are rigs is and interest a to moving have multiple where setting basin, about mineral Midland, Delaware Yes. we ourselves you XX/XX return the know high Midland efficient towards up for most possible. capital

Jeff Grampp

guys. Thanks it? Got

Operator

line of America. of And from Asit Bank question Thank Sen comes with the next our you.

now line Your is open.

Asit Sen

about liabilities, pay Can any have been months? directly question on the theory Kaes, could one slow into Kaes, the sea the of bottleneck My update export market Thanks. is you I a what you deck. up. in and all borne have on take for or market next in flow And some reports is condition of talk of couple of Good happens on the the pipes? us for physical Travis. perhaps slide in these morning, getting detail update counterparties if backed thanks in for assurance, one the there there terms

Kaes Van’t Hof

market, as you it more have sea don't last I the we in the liquid is than what know, especially about seen borne details know all few Yes. the but weeks.

back But rates water spiked So here. realizations. get on now, impact our you tanker are they bit, certainly starting bit certainly a spreads, to widening would little a the down which barrels little have see come

marketers And to going night. the overall, arrangement uncertainty, little that is is us able which being to of allows our are times better call we that and in of are know at four right barrels stick insurance in point now. a only move But provide marketing our to whole to something

perspective, pipeline sales we those a well about, take pay send the the and [indiscernible] a year, be force fees, as XXX,XXX don't if per declare total which didn't instance move? piece from On where barrels is barrels the pipe the or only measure, one down pipeline or day pipe. Should perspective. million would now per a $XX Our is commitments from right take pay sales as barrel

Asit Sen

And on crew? considerations What restart before Thanks, operations? on you other the are potential how signals? some would a completion consider quickly Kaes. are the adding restart broader of regular scenario, you could Travis price what

Travis Stice

economics, right. it only by Well, be should driven

and so, that we with the high economic to And curtailed make our will that is decision going on then balance what and into the curve service we for an is production about, think back to the following I thing work, is, obviously, our some first to XXs charge get I the the form against we sector are in to equation, start would of back XXs. volumes get and come will do forward alluded then that, and expectations low economics

the you But you growth, look saw to back used that last if really that to in our there is way flash prices world all what the like year. out

order. as think industry as into So we an evolve I this new

we look it accustomed have what is think to. different to historically a going than lot I

Asit Sen

Travis. appreciate I Thanks it.

Operator

with from Meade Charles Johnson comes Thank our lot a question you. And Rice. next of

Your now open. is line

Charles Meade

Good you your and whole morning, team. Travis,

Travis Stice

Thank you, Charles.

Charles Meade

elaborate my I that? of that you scenario, looking the words, for that are industry also outside guess would one, anticipated? guys seems how that your recovery. you prepared to think Is prepared, inaccurate on V-shaped work are response it the in earlier you from to the than have positioned are I you back in you and but you better guys Travis, other for in the more a In your longer to hard in go question back the on foot do more point front half year. your other get

Travis Stice

Yes, to or prepared we that it whether well of the our it we time trying whether go with is prepared But are to investors the first, what market back for is that longer, strength, for lower, that. are to that work, also are signals what financial not certainly V-shape demonstrate our or U-shape do going we whatever. like in or look prediction flexibility we are recovery to is is to

again, on letting and exactly comment, these strategic to transparency the and investors decisions out, business we us, we stepping the back scenario my can about times, uncertain that behind thinking in our what you plays count are rationale forward know But make. the whichever

Charles Meade

guess guys a that, bit part consideration. the following completing to And actually retention or wells of for right little for and are it. quarter lease then obligations may I said now, lease but you that going you if is know you concision a crew be I not Got run on still up are

XX mineral lease been about back I of other up wells maybe going do rental those in there I'm rather leading thing. on some some XX to other imagine other owners that other or there than the you curious in have considerations are evaluated up a or and options compete or offering XQ to going that options? are Are so obligation

Kaes Van’t Hof

Charles mid those progress, can’t quarter know lot Yes, in you you the a of into probably heading that completion. a wells so in already have discussion

to where easy pretty we and mineral flat our owners happen are price are We we through given with this work is. with working

So push we out we can, if we can. whenever whatever can

is with extend leases touch acre working to trying completion units, in mineral X,XXX get to dates. that, XX been We we to month. a are diligently do hard extend and owners But, it in have

Travis Stice

Charles, and to on almost, Yes. are are our drill but our not getting well inside, a land the are like it, commodity. a they lease day complexity and completed to paid organizations they land to when it that engaged and is the avoid, will to every for nice say having to is, terms feels unless light you just we work actually or communicate professionals, add engaged, hard I

trying times indicated, Kaes very also and our all owners it is to concessions. difficult forced. get is on same your and it the make, lot the of no, to as are page at So, to everyone business takes But mineral person is hand understand one say a then and

honor organization us only minimum and really the completion through this quarter. says work are of proud get where So, we the are our doing they obligations running to land to one point

Charles Meade

Thank for detail. the you

Travis Stice

Thanks Charles

Operator

Securities. Thank you. And Tullis Capital comes from One question line with the of next our Richard

is now open. line Your

Richard Tullis

where Thanks. higher lower needs? have do as infrastructure drilling the current the generally runway path with continue inventory Travis, NRI much Good how morning far and to well areas you everyone. on are you as

Kaes Van’t Hof

XX our are benefits from think that we I Yes, to gross is down deck show the you as of much possible every slowing try and Slide and on I year. be that update as open we in what Richard, think as is and XX And through inventory one Slide of that burning not inventory quickly.

complete of Midland longer survive quality pretty production wells XX% flat the think to long employee, to I basin, runway in got a a environment. without you high keep lower for needing our XXX of So XXX,

Travis Stice

a said, is got extending and stoppage locations runway as us, the completing have We those our license. which gross in of inventory still and XX,XXX in are as Kaes front slowdown exactly adding activity, in result of wells over activity or Richard we actually

Richard Tullis

you. or any oil need substantially second the to wait you And does plans acreage know that Thank for limelight just half the in to resume testing year Okay. of prices? the higher secondly, of

Kaes Van’t Hof

now mineral way extending probably are on owners the payer. we discussions our Yes, next the having right delaying with our

Richard Tullis

Thank is you. me. Okay. That all from

Travis Stice

Thank you Tullis.

Operator

question our Jason line Capital. Thank Imperial from with comes you. next the And of Wangler

Your open. is line now

Jason Wangler

good Hey, morning.

you obviously kind that maybe we side Are maybe that you in of just or go out, interesting think environment? out M&A had you, lot in some do as inventory, But much from the far forward you past, anything and certainly, it talked playing about others have about maybe this but plenty as kind getting one, so of Just a got of have as position the seeing a weird more see are probably is you we in better around you and now. playing point is many than impressive. something but how as this

Travis Stice

of we Jason, side we is is is recovery. doing, flow I preserving doing, signal the you getting has when strength maximizing all When financial which now what the right Yes. but and question demonstrating a cash this is are other think about the there, are it know liquidity. and to there, market validity, our more

Jason Wangler

appreciate you. I it. Thank enough. Fair

Travis Stice

bet. You

Operator

Energy. comes Heikkinen you. Hall from Michael line with question last of the And Thank our

You line is now open.

Michael Hall

it of prices Thanks, good little that morning. two, touched on context of been is was structurally a look And through, number I a of let's appreciate the growth bit the what time, term it or year philosophically we a to signaling than lot have on been the but just type been is follow-up basis, what price of might that that wanted just year's sounds move program really XXXX? capital back on whenever of in it beyond maintenance that required comes? quarter-on-quarter will say like, you thinking get prices from or kind Number that? one, to one to like a but are those side is sort are in and level, to how what confirm like ago, addressed. after wanted function maybe of kind But, last signals maybe what payout the it combination just is theoretically really gross then just time of have or about returns lower and combination, longer of frozen a more like, affected not be look

Travis Stice

I at year, greater a making perhaps ever end And in and think the the hyper-speed model. than were industry, year. had. in to then a as March it got take we last pace rapid changes slower this our industry as is with of if more growth a return I've evolving an And

going to new prescriptive it going feels have is investments oil ahead, of our to lower order in So, looked growth as or a to returning, we returning, at like today, what way lot are as we returns feel least this like, investors. more a

and to a the to is - is cash time. And - at make it of going our you there but flow, the appropriate when we you definitely looks a want is under when the this still dividend we course growth same sure have certainly purely I t think strip signals, profile. a maintain resume maximize in market all what those But going lot be to lower like growth evolve it year,

Michael Hall

I Okay. range getting about quarter-on-quarter level else but equal just would a in to to fair XX growth that equal else round that a a assumption back is today mean maybe all is make to say knowing profile? all to it XX that the signal hard that

Travis Stice

than Yes. the more It price. just an is oil just

few we is with growth to growth, dividends, be aggressive you get can you signals if the flow. some leading I may maintain just you at I XXXX, of and make and when the but back along get growth. it cash our that careful got said more earlier being our got have back before look think we maximize what that think price Again, now cash I to to on grow, have certainly signal the sure want scripted on we pretty look maximize time to and exact like that that in super flow prices we dividend will

Michael Hall

Understood, appreciate color. the

Travis Stice

and update the are that can the going to kind transparency is transparent market. we on to important, the we to little a way as I again we are to clear, that you we earlier as count on about can the trying it part, I communicate emphasize Just see finish of and gets think future, future went as here, us

to we which corporate Like the five of to going things we be will demonstrate to we know culture are of one in times transparency, And hallmarks four done said, evolve. these our the you and is to have continue you it last continue are let communicative weeks. and going we as

Operator

the conclude for to now back session. turn Thank would question-and-answer Stice like remarks. call you. I closing today's And this to does Travis

Travis Stice

a you. Listen before this I Sure, share to to I close morning, thank with thought. final guys wanted you

like have amount all looking months XX the in we feels time unreasonable last not sheltered back have that, over I've into place. remotely had And reflect of when couple We of or worked over doing course, what of we by as is I'm The an disaster to a and and worldwide XXXX, and spaceship events XXXX financial now industry, the in out. X/XX, in pandemic challenger in of several are the have Coronavirus. there involve that significant years stood been XXXX, crisis caused the had

times, events look that historical that two I were back at were there those participated really attributes during demonstrated. that felt defining in, those But when I I

found in the financial is, first of of to a is tragedy, and the tragedy resiliency Even really people. American the human way The we move forward. face

And through the we situation our get and today's it important is that hope will better. will attribute get I environment is in this hope that and think second hope,

resiliency back again. country let's to count this work, get on we as so And once that

Let's tomorrow of and importance each that Hope ourselves, for be the remind will better. our our other for also hope. kids grandkids

today's Thank out Please questions. in participating have call. you you reach any for if

Operator

for call. gentlemen, this and Thank participating. you Ladies today's concludes conference

may now disconnect. You