Qep Resources (QEP) 24 Oct 192019 Q3 Earnings call transcript

Greetings and welcome to QEP Resources' Third Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator instructions] As a reminder, this conference call is being recorded.

It is now my pleasure to turn the conference over to your host today, Mr. Investor of Director Kent, Relations. William Thank you.

begin. may You

of Cutt, Thank Thank Finance; Joe us joining results Executive call. are Vice President everyone. Richard Chief Redman, Executive third Buese you, and good conference Vice Tim today me Officer; Rob, President you With and for Doleshek, and Energy. XXXX Chief Officer; for quarter morning President Financial the Bill and Resources QEP of President Vice

obtain the to of If our to with done our release you've contains our supporting so go which qepres.com not earnings please financial already, website results slide materials. copies tables of along with presentation

free conference call, are reconciled flow. the today's EBITDA including as SEC These most non-GAAP measures to adjusted in measure comparable and EBITDA and which in release our In and the cash use referred filings. release earnings to we'll measures is earnings GAAP certain filings, SEC

that could our statements of our addition, and be beyond facing remind forward-looking making SEC numerous risks forward-looking which to of We variety our our disclaimer filings. and forward-looking statement in We robust these statements. our from are control. results earnings refer our everyone for business reasons many materially everyone In more release actual of a discussion we'll differ

call I'd like to to With that, turn over the Tim.

and full turning operational to guidance for before followed strategy, and performance, by Thanks over the year. call update for third quarter our the update call morning you business discuss Will. today. Good performance an to joining a thank our the I'll begin financial to with the to Richard brief

better exceeded expectations recent continued of was all the during particular due to third the oil in most production operational in our pleased I'm that In to our in line Basin. or with guidance. report Permian categories the DSUs outperformance than performance quarter

rate well to rate is XXXX lower line continue work in is non-employee G&A XX% XXXX, the -- to at forward. items and underway projected and excluding the quarterly expense with run projected expense for going special run down G&A now from to

budget. expense Lease operating continues to our year-to-date against improve

performance in the focus operational quarter cash company free with generate resulted strong continued fourth in the and positive to the cash in positions quarter. operating free on significant expenses third flow coupled being Our QEP flow

condensate the from XX% and the increased volumes. production remained to our XXXX. environmental sales Basin quarter stewardship Permian flared than of and reduction gas Oil resulting in forecast Permian by the focus third second higher on of giving

assumptions profile, above the of are The XX DSUs in enabling detailed on production plan. through completed deck, a spacing their to Slides IR projected us stay XXXX or on producing of drilled X volume ahead go-forward on currently our

quarter Mustang in two August. The County fracking during Mustang Permian moved included rigs the Line Springs third in and to from late Springs operations

fracking operations would the late expect begin County We fourth quarter. Line in in

activity, in to the fourth third we fracking suspension result third to and a production expect and the to peak quarter. planned production Permian the quarter As delivered decline from

performance of In of from seven-well the is quarter and wells the Williston had these the At located in encouraging. South wells third seven on pad early we end, quarter. Basin late we Antelope production on our three the production Vegas very initiated

expect quarter. first of to equivalent roughly increase in quarter these oil to we levels fourth the addition With the wells, the production back to

anticipated from overall production to fourth the in QEP production the forecasted the quarter, resulting in Basin slightly quarter. Basin in the fourth the third During Williston the to increase is Permian offset for decline growing

critical timing at this the we to minutes timing the planned spend next and will flow. QEP is cadence as understanding the development I'll of ultimately deliver explaining understanding program forward, few which move free our modeling cash

and basin our program. continue with activity a production X expect three in frac completed single X-rig year-round in operational drilling year. the put X to to crew the on Based due being can we improved quarters the on to planned In the Permian, rig efficiencies program new first of support wells a

year of will September Williston, quarter be In the majority activity warmer the months cost. completed April while in in completion the ensure program expect we from begin and first to drilling the of to lower the through of refrac including completion the execution each our activity construction

significant This deck. operational first free cash volumes in year year as the half likely that half generation during spend in the during half on mean seasonality year year the out into capital translate half first the demonstrated slide of second the generally the will second of of cash will This higher IR than of the the the peak quarter. spend be significantly third will flow and before XX of the will

this that extremely development seasonality is a annual as departure the we important non-linear to past understand program from capital delivers is at to understand consumes a that the less free and trajectory transition flow We $XX positive oil. cash but

business mentioned we call, to our During venture water I of were evaluating maximize joint including that or sale or full transaction. the a of last partial substantial a the value variety options

We options continue and end with to the our order forward call. to sharing year plans during look business these evaluate

to minute transition financial CFO our position. of Before the to results, discussing Richard to wanted discuss announced turning our call I the spend a

The and January VP more in you of smooth years XX company service. transition. Richard current Bill our Richard replaced As Treasurer, confident be X, experience a XXXX. are Doleshek by in several read the will will Finance we year Buese, we mentoring yesterday's been Richard at that for years this has the of announcement effective after for will end preparation than the leave and Bill change of

XX% be thank Richard and congratulate headcount, VP officer has Consistent I'd eliminated. on of been focus reduced service which his like to on with This from for his concludes promotion. our move Bill's of XXXX. by reducing excellent will overhead, Bill corporate role reduction our Finance

that, over Richard. With I'll call turn to the

honestly Bill kind I'm highly QEP did been abilities Mountain Thank can have I of and years his last its I won't good on you, Tim opportunity for excited the for this about part X confident I and calls. the miss worked thanks of and say things X.X but words. Time I'm a him. together earnings a.m. I've inception, grateful believe your actually for a and from to we lot

I'll now quarter for guidance call third give our before and the results more we color XXXX update about Q&A. open the up some

production, was the for third of Our when G&A, the impact production field lower transportation sets compared higher of the quarter. reflective of a higher accompanied second year-end best by the XX.X% quarter stage we other higher expense of partially expenses, to was the and $XXX.X second the million lower LOE oil strong adjusted adjusted the start and lower tax offset lower The and EBITDA. among to generated quarter, and quarter by year things, compared quarter the level adjusted EBITDA prices In third XXXX. which is of

the expense longer the present the know have future the obligations We quarter operations. includes in service high looks which transportation that production payment we value area, in an but pipeline firm no of expense in transportation

we of end our quarter, $XX at net $XX the quarter net commodity $XX third net At a the of the the derivatives was $X liability income portfolio. For reported to derivative million. a second gain associated the of million million end Net of asset portfolio of a quarter. the income compared third with million unrealized was

derivatives about XX, held derivative commodity September totaling barrels contracts of to enter million basis swaps, of excluding continue which XX% contracts and into during of XX.X third we We covers as quarter the XXXX oil, greater XX% the forecasted doubles production fixed barrel. volume for forecasted by by of XXXX covered is at production XXXX such that than price $XX.XX covered oil oil swaps a and now

adjusted capital flow reminder, and the as cash acquisitions. as define cash million And of we a delivered including During we free expenditures quarter $XX.X stock-based non-cash free EBITDA expense cash compensation, less flow. cash plus interest

to debt billion, $X.X end senior of and was cash regard approximately same $X.X $X.X and nothing of balance $XX all With revolving We which assets shareholder the total was Total sheet billion under was quarter, outstanding notes. equity as our at billion. about of our the the end the credit the second which for quarter. the of is had million level had facility about were

early XXXX the fund notes mature due Further, to cash balance $XX senior redemption. that of we'll March use on the redemption million announced the that yesterday and sheet of are of to in we

In down focus several our increased capture by terms gas there guidance, and rates, of are driving continuous efficiency driven performance, updates higher better on costs. well XXXX capital

guidance are of barrels to XX.X a at a increase of X% the overall production range million XX oil midpoint increasing guidance. previous million to equivalent, our We our from

for oil to of X.X full the of a to XX.X the year are guidance million our an barrels, increasing range midpoint. at XX.X million We increase million barrels

Bcf, the XX.X XXXX guidance gas of to We're finally at midpoint. for to our increase to X.X volumes for million for guidance barrels. a XX.X increasing to our million X has XX% a volumes increased NGL range natural And

midpoint. our lower improved by The at position guidance team’s the in million reduction to continued and additional efficiencies strides XXXX capital $XX cost us

our G&A year. our $X are for There earnings in guidance lowering release. our we're details additional addition, In by well as about million the guidance

provide the summary brief open turn call to now I'll back we Tim the a Q&A. call for to over before

Richard. delevering and on ability Thanks, our the plan our in asset as a overhead. a commitment decrease and and reduction the as drilling performance corporate significant sheet. delivering we to described committed business deliverability flow completion call. costs improved summary, during of this high-quality all our successful balance against confident facility that and well cash last of In I as sustainable generating We're base, the dominant to in free are result We're deliver our of improved

them an the would level and to of contributions have high-quality this the change each unprecedented last that I quarters. want during without thank Clearly, through of set three of in for none The of our be up the persevere company possible organization this individuals success, personally. workforce

With that, for questions. the up we'll open call

Session Question-and-Answer

be Instructions] this your Cowen Gabe & a Please comes will question. with proceed with conducting At time, first you. [Operator question-and-answer from Daoud question Thank Company. we session. Our

and run that about with in just updated XXXX. like in And guys morning, the XXXX that What I million I rate would mentioned you the trying what like guess given figure than savings year? $XX thus XXXX, less to look you far. just million D&C out XXXX? be given could Maybe $XXX good everyone. does fact efficiencies Hey, savings, the guess budget have ultimately Permian realized starting the spend this number look

We've working XXXX. $XXX numbers next think I or through be next the the plan we're got you to than going plus there. year think I still bit over minus preliminary million our we're several lower mean, a Gabe, that. if about out Yes, years,

through. work And savings need all these so of to we

the in Spring We're Mustang Line. moving County of out

we're $XXX that about if And that Permian. think in or so North make minus changes our the sure confident million still we could to conservative and less of plus program we're $XXX on up bring in of thinking or but million, want you that what Dakota

to start that. on think that's continue I good with. a get we number And closer as you update to we'll

how but follow-up guess a about a notes Okay second balance just Thank, you the should talking guess will redeem the think I just handle understood. about notes. we for maybe Tim. guys way then the as the and And I XX sheet XX

about I think that. it's $XXX curious on million just

those. at Richard. going year. a Hey, have to going to of evaluate continue through and do Gabe, year-end to it's with generate Clearly, next to We're cash bunch we're cash what

the is maturities time. our approach be date. So March to going gives that's maturity as reduce us in to it the those But we XXXX some so of obviously, focus trying

All right. guys to Thanks, though. all you best the and Richard and congrats

Thanks, Gabe.

proceed Our Please your Stifel. next question comes from question. Derrick with Whitfield with

coming all. Good you in the release a ops hope the update. press Congrats some Richard months. time morning enjoy away can on and from also strong business

Thank you. Thank you.

an taking costs the has business. Tim QEP capital out exceptional last year, done operating the job of of over

arguably lowest basin. Your costs DC&E are Midland in the the

capital see you or the As greatest remaining do you operating? opportunities cost look where forward,

Yes.

we're So have two mean thanks where come phase a wells still that The the huge sample lot out to our next increase costs, frac put of we on of simultaneously. for focus we're gone the A basically costs optimizing I completion in pump we've rates. to -- We've that. that. is fracking produced there. a

can rates pump the process about a XX that barrels to And minute. whole we minute. what had a each We does on is XX We've barrels though. maybe that think speed well just raise

that will drilling suppliers. focused I speed $XX days so, is work that XX again We're on -- that. our contracts continue our We're per to with the down. bring our And mean so friend, way well we

do I got on we've the cost. facility more think to still

kind We have completed I'm phenomenal in of previous the -- location our outcome. shop started obviously last was project it build which our on I'd million to the the I of was the to Dakota mean was same million skids thinking and pad biggest of would North the a numbers, it say and bringing doing just in facility our say side $XX million. $XX $XX sub a to pad going throw the -- pad

get things things, straight continuous the time on-site -- time. work up really So is that in picked just thinking how about improvement and minimize just

So that's important.

time that the a But just this that side, something huge if an asked where have you And time. a Gaslift then that. at most pump more will and in OpEx are give of to about Gaslift. efficient. amount is on of bit process little not sure I'll we the Dakota, I'm up a example. there run come have spent you on and wells will be rigs. We'll over In now less lot workover a our we're North converting on

it's a so just bunch and forward. And tackling blocking whole of going

That makes And would regard water With and you the with are thanks sense for the for you where Richard follow-up. characterize perhaps evaluation that. how in infrastructure process? to business, my

the And sale, capital an partial done is sets of process from full we're say monetization? it of both it well areas pretty implication we're joint -- to really we operating process. be in Is and We a evaluation I -- is think a that. would understand just the with both monetization or one now what it think area. our venture

we're phase. the of in So sort fine-tuning

from of standpoint think what I our have going the will and do us a to what we forward. transaction of evaluation

I completing that. think we're substantially

responses. time Thanks and Great. your for

Thank you.

your Neil comes Dingman proceed Please question from next SunTrust. question. Our with with

question full Bill just have this Good next and just for you. I'm out. you primary around with I'm you activity? look and XXX my you to earlier, for Richard. your working XXXX all Richard free guide target your well ultimately when and that you cash again don't you I'm of kind have forward flow congrats XXXX or Tim, is wondering set I wondering morning know year mentioned and don't wondering Or will for

and hedges wondering But more it I'm added and is have certainly just again you will some that help.

amount flow? of to all down mindset you to when Just primary it cash x what you want and wondering trying generate Or of sort want about there? free amount generate do activity? sit to you of the x driver sort think Just your of is get that

question. Yes, that's really a good

went process, balance kind the sheet. to at going XXXX. say, do of we the we to what How on to have we're how calculate back year, this we do much as of deal with need cash it balance and the affect So through of XXXX? we the to next sure the for end sheet year? year delever end And to need going make our hand it we in wasn't And budget year, or throughout and cash do the have much

right. you're So I XXX I us. that important number to is mean, think

that Do of should all million remember, we of in have refunds, another $XX.X form that tax been considered. come on top that’s of the

questions a about improving. or had we've So the last few day over things -- are two, just

that We changed XXX. haven't

are we're you NGL get we off Do off, year? come a modifying differentials little to understand, bit. closer things as prices the have

deliver price least, And everything is making at substantiates so, we're that at $XX volume we're a hedged, sure for not we'll doing, $XXX that million. that

us. important it's to number an So

say caps anyway. to going in not I'm that us

to and then build deliver into movement the can next of cheaper. more year do end So a go better, volumes XXXX. we stronger higher into we faster, figure how to out Hopefully, and

improve on very process, on the is we're lean is think back our as But that aiming journey move think time forward. through keep pretty time plan. now. and variables a the coming we number to, excited fairly not organization around. strategic focused So the good don't in as to I about started And tough goes we We're XXX we a the that

very think, of just of there. dovetail still just and you've put more of great decline activity there, in obviously maybe a had side, -- and the about you've talked a Great the a of bit capital color. Bakken -- a And I because terms amount just on asset perm then, the that. Well, lot into very,

wondering you anything more next could Will bring oil what a be about you've you talk you Do obviously, refracs? in -- more just maybe terms of there? else I'm active there. you I great mean, year? out, to got content there try

Bakken the general. can in Just about say anything you

quarter fourth notes, that the look on my to just quarters. will the going take completed on heard quarter, So between us fairly speaking to to if on have two the equivalent back volumes quarter you the actually volumes full quarter, we're bed first you -- full my at Vegas talk, when we've those activity

back up no activity. decline stepped with after fairly we've almost So a long period

new pad drilling activities the all very completion the start our refracs the of between and on will year starting then Disco We drill there. the in the have spring bringing all early into we'll in fall, six early and way wells XX

Williston keep relatively X to is million basically plan barrels about our the per flat annum. So

active on, each peak a at and Very peaks And the we come slowly come wells oscillate the forward. to the difference for the do the higher up. stay Bakken great will And few it the Permian, you're our bringing go refracs. next only going will over feel similar the those we're seven get Permian of higher to years off will back volumes think production we're we as is will and see quarters and We as and about flat in rates. relatively

online that We moving expected. XX forward. have are refracs We're to all forward looking performing they're as

new We circumstance get set our there, between inventory in completed about to a and continue how wells. field high-grade our original are but XXX almost there pipe and we frankly we've wells South to there, we wells opportunities Fiver and Antelope, special with pretty got like have their

Very for Will. good. Thanks time, the

question. Simmons Our next Kashy question proceed with Energy. from your comes Please Harrison with

stage. questions Good morning. next Richard for my taking and congrats Thank you on the

you to me, you could beyond aggressively and leverage few a the the capital wondering more just discuss desired if dividend? returning questions I up before what So, shareholders begin from was is target

Kashy. for And thanks the wishes. Thanks. Richard. good for It's Hey, – the

EBITDA below down leverage two we're the see to step multiple first times of close. target getting leverage and Our debt

year, proceeds the and year. flow look cash time for to of EBITDA consensus look cash sort we is from potential at sheet By the on any end – monetization the of what the balance next the get times, you If first at target things. that were next gave at when ton spun to we we or should that out first pursue of flexibility with other X.XX be re-flooring at Questar us times do and we and a two acquisitions of that

on below So, and program, think consistent get right two I anything on of doing I and now, refrac target. fairly think terms got Until we're to program. we've with going be development that path times, in to the then we that that to be a aggressive more we're

how that's EBITDA with then of Okay. water which I'm with infrastructure assets? the water sorts my just associated amount could get cash of segue And but is take actually associated know, the all is infrastructure assets to a today? question, much next is good to I different it it flow trying a on handle as the structures, stands

inside that So the E&P business is Kashy, water embedded asset.

And are the the don't it, financial statement that. if with around LOE generate we associated a so costs growing so

a And was cetera. et source business contract EBITDA freshwater a so sort theoretical disposal if said calculated we you of it "hey have assuming rates stand-alone for

So as is stands out I part we some generate but write don't and it could business on we of we numbers. mean, our and Whiteboard the just today -- LOE that

at think, X-year the million that were million, the to rates $XX I capacity in would we head that EBITDA if we've range. probably number generated and market $XX

barrel. can one build market-rate here think that. And type that, The $XX of a buying in that process Kashy barrel. And I for the ways $X.XX barrel. as Yes. the range. $X.XX for I'll $X.XX about fracking to of a on we treated $X.XX from of a to is opportunity order mean probably produce $X.XX you the is know inject We you barrel water a water

trains capacity sit. processing by that capital expand the can where the So easily there's that's -- fairly And economics business for low investment. of additional adding we

there. best to that is to just infrastructure best We out and the the margin. be leverage would way big figure the of grab some partner who potentially have to that So

XXXX? finally Got is one what look transport think us adjusted very it. you evolve to line number rate for just towards the of more about nuance That’s through run for a could Can last helpful. think that question. a how LOE as just we trying me, And item? I'm then good modeling help

Joe.

Yes. of transportation one. Most through processing our volumes and contracts. Good move

direct relationship a lot of really in volume forecast of the and variability of year not that our that's a subjectiveness to so And there's volume. for upside

So good yes, per a unit. mean rate I

a $X equivalent. about it's barrel Yes

plus associated out BOE. charge average, take you it's be the to with pipeline the If onetime On or minus going commitments. of $X the

Got me. That’s it. it for Thank you.

Nicholson with Gail Please from question. comes Stephens. with question next proceed your Our

a dig more. want I to little just into bit LOE

Bakken. today could And quarter-over-quarter. versus You Permian lift, Williston? a the then to versus LOE decrease guys transitioning talk in With where transition gas currently? sit could Williston saw the mean about I the good you to really about the see lift does savings talked Rod you the LOE potential aspect you an that Thompson, on gas

Joe Okay. to over this flip of our I'm to going Redman. Head He's production.

we've for In lift around our Williston, an the be than we'll go our method you ESPs gas that our ESPs. And initial lower lift, and cost forward. seen some the of been have optimization we I Thank think we expenses. Good. employing will probably gas question op using a around lift on as come operating in historically at drilling new

been field And down then through done We've similar are our around fixed there, and continuing in methodologies. our same of to we Permian. just also kind activities. expenses, drive LOE the in bidding that the We've working

quite -- about running our BOE. we're mentioned range in is of Permian the the a and of this you LOE less as $X bit And a in year

incremental at then in improvement for XXXX? the any of and the do look refrac remind cost you current you potential And Okay. me room Great Williston, cost, on as think, there's the you what the just can side, are? looking those in

Yeah.

I'll that take one. So,

cost that it's right absolutely refrac. back we per $X want into the down. in well here, series more We get we to now, as So, have about a rhythm on million take

suppliers talking can And do we've lower already the we more to how encouraged to that. goes we're that around So our do.

to facility in that talk about in on same But XXX We And XXX. the the locations drilling Williston. and the about Williston. costs thing way expands the up the number remaining all

and you If price lower get much cost. better

costs very are motivated And so, bring down. to those we

a want we're work wouldn't But will to to guess as enough, early we're get I going a five, -- forward little towards if want number. but that. we don't I So,

Okay, great. Thanks much. so

Our Betty question. Suisse. Crédit Please Instructions] comes question proceed from [Operator Jiang with next with your

the have But strategy that change understand do artificial see morning. have you of change. the to more you shortest there in any And the on in Or detail I lift the question any -- bit shape on Good get benefit we seen expect Could time. impact? change the decline I see a production? is of cleanup profile? a

us, things. a it Betty this what a watching this. good things And we've actually and Yeah. that's bit we've change not for help that big we because going quite and harder question, a testing to been around been all been technical has industry thoughts little is doing. And our might only hurt concluded of on early

ASP as can And to staging and you quicker. the still PSI of go quicker. But that, XXX producing PSI can that for up we're so a size. to strategy about see, we've bit pressures the them with bit drawing change on opens XXX production quicker. down moved quite in is choke the wells And a you But come coming get it quiet you a does when about

are, is fairly we're back you dinged We lot we've of by curve here. you could a the up. could talked to don't slowly. over little bit, always on a said where where kind thing to on Same you're -- similar. day past back time. But coming back go know decline in been caught ultimately get we've We've for a We happen XXX,

NPV makes these a it bring quicker. We from on regardless still still well to sense the the productivity oil of of a and think, bit

can DSU several we're you So close funnel over months. there the to see XX tell getting next the on curve

We'll what seeing. flattening by And expected. encouraged that see feel that we and declining as where But we're goes. we're that's good

question Great, that's just the just Could guidance, the that. volumes? next with understand is Permian. increase the between in and for then, XQ thanks dynamics implied no oil driving And us Bakken completions the the you Permian, oil in on my help the

XXXX with oil how the lumpiness XXXX. just versus And Does XQ of -- XQ then compared volumes XXXX the product also does -- profile. completion on

Yes.

Okay.

me question, you sorry remind what So on first asking? the

the What's increase? the that Permian was dynamics driving between the Bakken and the

Yes, got it.

wells XXXX have right of Remember yes, to now X did the Bakken new to the wells. increase barrels XXXX So a we going so those day. you're bringing And -- Bakken in north of per well we loan. each oil substantial average

cost start built Part months facility declining. of we a That barrel day the then for months, X facility, next the will stay XX,XXX out X facility. keeping on the and flat a

have so X and the we over should should the all we maintain And gains gains see months. that -- months, next those over of X

And uplift see so you'll there. big a

uplift the then on decline. to that start obviously modest more And in the to on you just And is now decline than go have started go Permian, decline we the of Bakken.

you so, And see slightly flat to increase quarter-over-quarter. production

to we more I out. we allows more. little to want That some faster. to it's what will quarter out the us We continue dollars a for That numbers speculate think early takes do Betty, fourth get us on happen, year, want and to think to of next put we to bit continue get better.

of in third and building where -- come the -- the the curve little is in the the you in second, first bit And generally coming set, in off again I start the think peak shape you're fourth more down that off next a you year for fourth. start then quarter, in again

XXXX think to I a us so get going for fourth kind to an get And to it. closer to fourth accurate little bit have of quarter, to quarter XXXX we're

get every to our day. And whole better goal single again is

guide this as And we so to and get can. we'll continue we as closer update to

All that. right. you Thank for

with question. Please comes MacCurdy Energy. Our with proceed Heikkinen from question Kevin next your

materially question barrel per going follow-up around Is on were the guys. standard Can new costs that To morning LOE lower continue? that quarter-over-quarter. Good kind forward? the of

periods few a there. in had we think I prior Kevin,

accurate you'll year, put think our you the look I for full what if at LOE. forecast for a number we the calculate good

enough. Fair Okay.

the come a on that a You a But substantially a things. up generally, back we've they different dependent little lumpy. little of go fourth things come had quarter. in can it's bit quarter. may low bit and have It But overall, and be seasonality lot

second quarter that. example, rate, to fixing Kevin want down to quarter. just give control more $X the the which was things part. at they We workover is expense, parts when don't third than to you Rock from And frac an million

really So we terms third fixed quarter of a good had in stuff. break

Great.

trend So, down? the some but lumpiness, maybe overall is

down. Absolutely. our unit that at of wells, as you'll the in see facilities, Yeah, facilities, cost costs quarter-over-quarter we kind facilities with unit more production cost if deck. look absolute injection month-over-month, It's in add coming the our water we the clearly add goes production up new profile and is move described we you in as new

crews will fourth question What production you idea get month Thanks. an just frac see XQ? for we coming mentioned I'm the quarter. line? that my in is to to trying in of start late churn Permian next And to back the

We've kind my I talk a fourth questions quarter. the quarter. in had the of start capital in that Yeah. in late few will profile about mentioned

the expect again in We fracking December.

built quarter, by a frac wells an get continuous inventory program Line. on third next in County late of us And early have that about enables into XX December to started We second go into year, and quarter.

early And the won't but is until be come so, get February. fracked, likely wells December online optimum Those in will started. four to they time

we kind those see January start bring to to February you'll of continue So, decline. back online.

quarter, Great that. for Thanks right. guys. All

Thanks.

comments. to I'd the session. we've Tim like gentlemen, Ladies the Cutt turn to closing now call question-and-answer reached end for and back the of

of lot I've hope want very, say things, lot. Yeah. add. delivering organization and to I what made landed you the another questions. to through I thanks out I interest. strong doing great gone appreciate changes. the much a We've more we're capable deliver. that of about just Not set been to But our we've a impressed. on I We've see appreciate we've really very organization. super to a serious

thank to organization. So want I just the

that, With close. think I we'll

today's conference. This concludes

your thank participation. You you at we time, this lines may for disconnect and your