Ring Energy (REI) 10 Mar 232022 Q4 Earnings call transcript

Good morning, and welcome to Ring Energy's Fourth Quarter and Full Year 2022 Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Al Petrie, Investor Relations. Please go ahead.

good and Operator, you, morning, everyone. Thank your appreciate interest in Energy. Ring We

begin and full We of comments from an the call Paul with and matters the will quarter key who overview year. our CEO, McKinney, of provide will fourth for Board our Chairman

turn for over and to return up We the Officer, future Thomas, plans Financial before to discuss Ring's we call then will then will Paul review will Travis Chief outlook open who questions. our the call financial results. our

us of joining today Baghdati, available Corporate Also Legal, and the on and Land, Resources Alex Marinos of Operations; Human for call are, session and Steve Dyes, the VP Brooks, Executive Strategy; Engineering Q&A VP of Executive Executive VP and Marketing.

you and to ask your During session, to a the one we questions follow-up. limit Q&A

to reenter and a posted I'd to our later we with website. earnings presentation queue QX that, note the corporate additional also You’re questions. have full XXXX year welcome

be and be conference cautioned the statements During statements that the are of this statements the are those materially can meaning of may forward-looking Investors developments within such future course company that no company correct. statements to forward-looking call, give not making Federal Laws. the guarantees forward-looking of Securities performance will the assurance will and projected those prove actual forward-looking or from results in differ

otherwise. and described future or with revise risks statements, whether on other yesterday's our forward-looking events any as in reliance statements. you disclaims Energy SEC. or place These of obligation intention and press any new result update Ring release the filings forward-looking should are undue information, to or a in not Accordingly,

to in also GAAP includes earnings non-GAAP or release. comparable most our non-GAAP factors the of Reconciliations these ringenergy.com. in found call financial more financial one yesterday's underlying materially. actual vary under prove are at be certain website incorrect, to contained measures. the references materialize measures directly assumptions conference of may Should these results can Investors section or documents This measure of risk should These

a Finally, as reminder, this being recorded. is conference

over McKinney, call the turn to to like Chairman and CEO. our now Paul I'd

Welcome us Al. fourth today your for you XXXX call. in for our joining and quarter Thanks, thank Ring and earnings everyone, Energy year-end and for interest

financial with to quarter. efficiencies fourth our our program, full record targeted success a are the our the of the operational ongoing of X drive production and XXXX further pleased continued spending performance our was during to initiatives business. We capital Contributing Stronghold acquisition, and our implementation from in months

a of we volume XX% During to oil grew of XX,XXX the quarter per fourth sales barrels day. equivalent by quarter, record the third over

below conditions, with Although and sales and our purchaser primarily year adjustments conditions. interest a due this the was payout slightly the to Northwest guidance, gas winter of impact Shelf storm limiting constraints our associated system reversionary for and it in and of after was areas gas CBP the downtime

brought now We Basin and Northwest North. Shelf CBP to five in the we line area call Central seven on new Legacy area, in an horizontal Platform including the wells,

five we Stronghold CBP wells in acreage also the new area brought South. which on We call vertical in

South. CBP in We recompletions also perform nine

consecutive a $XX our generation. higher flow, capital cash million on was EBITDA $XX.X million. flow record was what was cash adjusted free of end the same that $XX.X than at which projects, quarter, fourth lower of million XXX% was of quarter $X.X result of produce guidance spent million the We XXth for of the We million to year. The quarter previous the free $XX during our

million and $XX the during reduced debt quarter transaction million closing position by since $XX August XX, our the on Additionally, we XXXX.

in our December. the revolving credit also base company's $XXX of under We borrowing reaffirm facility million

a Shelf a through drilling one of well and base defined in program. XXXX the of Platform, to core We continuous a solid with quarter an year Northwest assets develop inventory and rig return our company. marked high of for rate end plan fourth the our The transformational Central further began Basin

was acquisitions third successful into land closing the assets accretive the record our of operations, of systems. those integration pursuit ended accounting rewarded with quarter acquisition, in Our year by a and the we and Stronghold

record share. XXXX $XXX.X the a of than strong and flow of was from marked flow Record year-over-year $XXX.X million record cash XX,XXX million, were or cash by net record of XX% to a that of per income increase $XXX.X adjusted a XXX% or a and net operations oil adjusted several $X.XX increase, and $X.XX million share, to equivalent free of in and record highlights from per XXX% of XX% of sales previous per including: volumes a day higher million, XXX% EBITDA income year million barrels $XX.X XXXX. respectively. $XXX.X diluted Growth

the end from with the to the $XXX the year ended million We in XX% previous of lowered more balance we Xx XXXX. at sheet X.Xx. the of on $XXX million is had by liquidity, our leverage and year ratio than debt liquidity which We

five XXXX, we and XX wells, X including Shelf, the in Basin and of Central year full drilled in wells Platform Basin the Central During completed vertical South. the North XX and Northwest horizontal in Platform

South. We CBP recompletions XX also performed in

from XX.Xx of oil Our well ratio million the the equivalent X.X reflected X.X performance overall an discoveries. XX% prior year in an X.X barrels use the which to oil in increase equivalent to million barrels $X.X was was proved our equivalent year-end reserves, our also equivalent XX.X of and prices PV-XX production The XXXX year. increase extensions SEC grew equivalent of proved oil to total million of a in reserves billion. of Partially approximately from from SSE XXX.X for was acquisitions, million of oil contributing XXX% offsetting over of revisions, and oil grew record production. result The barrels success total was replacement barrels barrels the of million all positive

horizontal wells we amount This vertical our planned our also on drilling South intend of infrastructure million that recompletions, our $XXX and capital related leasing capital upgrades, on $XXX CBP spending to spend costs, and legacy efficient during between includes XXXX acreage, projects. Turning outlook, acreage. to combination for and ESG workovers, a includes wells million

a our Shelf, spending capital production. in been drilling completion of began wells with this is by has horizontal three program horizontal XXXX on placed the completed we Northwest A of on Shelf placed end all fourth and drilled January, of In been expected production which well Northwest and had in be and to the month.

vertical drill wells month we Additionally, area by three as CBP a three rig all the picked and having up anticipate South end in the of online well. to wells

budget $X barrel Our oil WTI prices and per Henry $XX $XX oil and Mcf. assumes of XXXX of Hub are prices $X and per between between

have program conditions. flexibility and with to respond spending changes the past, in commodity we designed to in prices our As other market

equivalent to day. full expect sales We XXXX volumes of oil year between XX,XXX barrels and XX,XXX per be

the fourth X.X% considering guidance, year quarter full sales XXXX. and increase midpoint XX% increase When XXXX volume anticipate we our year over XXXX over a of a full

of XXXX, expect first to come quarter oil in XX,XXX the per and For day. we volume between XX,XXX of sales equivalent barrels

Travis So turn discuss detail. call in and over guidance results financial to with I'll our to that, this more Travis?

we morning, the results Thanks, good for Paul, record of and comments and year quarter Echoing our very pleased with fourth are XXXX. full everyone. Paul's

targeted well as of months ongoing fourth to and benefited further the our XXXX drive efforts Stronghold Our the development recently results X from strong as continued campaign assets operational from acquired quarter performance efficiencies.

X.X for XXX,XXX of of barrels quarter. XX% of in total quarter during we backdrop, BOE. sales million of fourth This X.X than the is of NGLs sold barrels Bcf million XXXX, higher million approximately BOE oil gas that With natural and X.X a X.X third the

realized a million per realized grew XXXX, This For volumes full of moderately of pricing XXXX. BOE, was Mcf pricing of or barrel $XX.XX in BOE for million X.X $X.XX of per than our BOE. gas, sales we and XXXX barrel of XX% $XX.XX NGLs oil, quarter to $XX.XX from X.X the third of per natural per lower year $XX.XX increase crude BOE. was per quarter Fourth

we for in saw the of XXXX, $XX.XX per in XX% $XX.XX full increase XXXX. However, growing to a BOE pricing, from realized year

Our difference per $X.XX positive mostly $X.XX period is Argus versus futures pricing third Argus negative on that quarter. NYMEX barrel per role average declined barrel WTI, the due the per quarter a WTS, third and for for from differential the to of to from was WTI oil fourth $X.XX quarter This XXXX. declined barrel which average the a $X.XX CMA price the

natural a negative to average fourth pricing NYMEX the differential third $X.XX from compared futures for price was Mcf Our for quarter. gas quarter $X.XX the per negative a

fourth NGL quarter That for $XX.X combined of realized third Our averaged the million. to of record quarter. quarter third WTI compared price the of XX% the $XX.X fourth higher XX% for revenues revenue million. result than X% was was quarter This for

million $XXX.X for We XXXX for million full also the record posted the increase that of from year XXXX. $XXX.X of represented a XX% revenues

$XX.X was significant income Looking quarter for line $X.XX expense million, the per $XX million, $XX.XX compared BOE the more LOE to BOE items or XXXX. of statement, or on per at third the

million, $X.XX $XX.XX increased remaining while below BOE per midpoint BOE million during Production X.X volume approximately rate Our absolute $X.X at taxes to steady per quarter the the quarter, was than BOE of were to third and or LOE the rose sales guidance $X.XX BOE. quarter, prior $XX.XX LOE our X%. bit the per or versus of for with tax the a the lower range per due

million, which in versus DD&A per Cash from transaction XXXX. the the quarter each million excludes to BOE and about quarter. compared XXXX $XX.XX included a million of But for of million DD&A $X.X million was compensation quarter. increased for was third $XX.X of the On share-based quarters basis, third to G&A, fourth cost. $X.X $XX.X third $XX.XX $X the third

the XXXX Cash and transaction. long-term revolving synergies the third for $X.XX additional facility transaction. BOE higher Stronghold versus due This balance borrowings reflection average on associated transaction Adjusting with million the to cost XX% was per credit Interest $X of daily a BOE debt increase the an fourth $X.X direct million for Stronghold was $X.XX to third expense the the of a compared per to by the due the afforded quarter quarter. G&A for with decrease substantially quarter, represents the

or diluted income the of fourth we share. posted During quarter, $X.XX per $XX.X million net

tax XXX,XXX quarter quarter of $X.X hedges million was impact acquisition, transaction for compared or of $XX.X income $XX.X income million including to Stronghold of net our of share. $X.XX adjusted This XXXX million per net $X.XX expense, third loss items, or share. fourth pre-tax for million after unrealized estimated is diluted the per non-cash the $X.X costs and Excluding compensation on share-based of and

our tax share. for share-based million net Excluding impact for per compensation after costs, $X.X million million hedges and $X.XX the transaction or income and non-cash million pre-tax items adjusted expense, including $XX.X on of unrealized gain estimated quarter $X.X was third for $XX.X

of than share per $X.XX XXX% for income of $X.XX per full posted we was or year This million higher XXXX. XXXX, share. adjusted or million $XX.X $XXX.X For record more net than

$XX to third adjusted in record $XX.X for million compared EBITDA, realized Looking in at to the quarter from lower the we quarter fourth a report fourth the pricing quarter. sales volumes from increase pleased the significantly are XX% the third the reduced million benefit quarter in as

XXX% XXXX adjusted million the in quarter than same EBITDA was more than higher reported XXXX. the for Fourth period $XX

record to in higher $X.X million, than XXX% For for to pricing due full quarter primarily year higher $XXX.X sales million partially offset interest million, $X.X higher the the $XX.X cash fourth XXXX. was lower XXXX, third of the of and and was decrease volumes. compared Free capital the realized spending, expense quarter. by was posted flow adjusted we of for which XXXX EBITDA million The

For cash $XX.X of $XX.X XX% full free the year higher million million than XXXX, that flow was XXXX. in we generated

facility, $XXX.X of we million million $XXX the million which million. since the liquidity with drawn of borrowing XXXX At Stronghold million. transaction, of of As combined on base fourth we our revolver a the $X.X letters had available of $XXX of credit, reflects had quarter, total credit and a of the out revolving end of of cash current with $XX the debt million $XX December $XXX closing net in with on million we paid of ended XX, XXXX,

We are focused on XXXX. in further reduction debt

deferred I payment timing quarterly we course prices the note realized commodity Stronghold impact paid would on of that pay debt the Of associated cadence down. $XX with capital spending transaction. an the of recently also and the million will have

warrants XXX,XXX fourth Looking count, Accordingly, quarter, our shares the we million approximately common and $XXX,XXX that of warrants cash. XXX,XXX had of fourth our during exercised at financials had approximately the common $X.XX remain To million in outstanding. the per reflected stock quarter in resulting XXXX, warrants at have of of common the receipt X.X share XX.X we warrant. common exercised, issuance date

XXXX the and Turning quarter. to outlook first our for year full

capital drilled XX spending to As and horizontal full vertical XX drill Paul which of for to XXXX, in workovers. to is as non-operating wells, new discussed, to XX wells. anticipate infrastructure cost and estimated million $XXX our spending included drilling place the full online year includes outlook XX we the upgrades, XX to complete of and new capital to wells, completion XX for X leasing million, $XXX new and as recompletions, Also year well recomplete XX and cost wells workovers capital

we Based investment, capital and on spending of and the and related land, expect drilling, XX% for workovers completion for including $XXX.X ESG capital. X% the and for recompletions following guidance, allocation million of midpoint XX% estimated and facilities, non-operated equipment capital

our at is expect Looking of day, average oil, XX% natural volume gas XX,XXX XX% to sales XX,XXX BOEs is of full XXXX XX% is guidance, to we and year NGLs. which per approximately

placed to Northwest investment in production. including quarter, this as drilling discussed, Paul program, with on horizontal all our in Shelf three wells the kicked first Looking at we completing XXXX year's January, and date capital off wells

has A by of fourth the completed placed on to expected drilled be the been Shelf this horizontal end as Northwest production well and month. in

rig we drill up a completed having three three to the and by vertical and Additionally, South in picked this anticipate month. of wells CBP end the online wells

will these wells. four be for benefit there associated production quarter such, results the minimal with first As

XXXX range quarter and be to first expect we NGLs. BOEs per of day, sales to of XX,XXX be XX,XXX gas which in to natural Accordingly, XX% are XX% the XX% oil, expected

$XX.XX year $XX per of For to XXXX, LOE full anticipate we BOE.

in For first our $XX.XX is release all quarter currently XXXX, expect to presentation note our I of per in on $XX.XX BOE. and we would to range the the between website. XXXX included that guidance of LOE yesterday's

hedge position. the to Turning

For XXXX, of on X.X midpoint barrels XX% we hedge approximately have year of our or guidance. the oil million sales full currently based oil of

sales midpoint of natural on have gas or X.X based also We Bcf gas of of XX% guidance. the natural our

breakout contract which of each on website, includes quarterly for For see the position, hedge presentation average our price our please type. our

before closing So back comments his turn to I with Paul? Q&A. it will that, Paul for

Thank you, Travis.

points past. this call Before have we I'd in like questions, made opening for up the reemphasize to several

First and metric nearly share normally our substantially lowered foremost, transactions. when size improved overall similar and our scale, the increased and per Stronghold cost structure acquisition considered has every comparing

a to such weather energy operational and with volatility or outages are company, diverse manage mechanical risks power more positioned We downtime. unforeseen related associated as price better issues the or stronger failures

We hedges. and have ability lower significantly increased volumes revenue roll generate due to higher of our price the to sales off

increase flow our efficiency was to in provides debt. is programs return capital progress than the to improved reducing regarding demonstrated further made for remain efficiency capital with the we more our representing generation XXXX focused of XX% over inventory to have and our on The The our improved performance on opportunity capital capital an which undeveloped optimize of XXXX, future maximize over XX%. cash employed,

improved this. acquisitions. with our an spending enhanced enhanced efficiency accretive market stronger down accommodate capital more changing to pay to to efficient debt. conditions balance simply or sheet plans to also improved adjust provides The to and is flexibility our capital proactively sheet larger, bottom pursuit line ability today respond of is Ring enhancing balance and Energy The

$XX we in million pay in year. quarter, the million down of fourth and months the debt previously the of X $XX As last shared,

year, than We the also proved over by XX%. increased our XXX% have our and more almost liquidity reserves previous

the strategy. So talked yet about state about that, But our the XXXX, our having we driving talked plans said strategy. have for haven't of company, we principles the and our

company we those a believe of create our community. our scale for tried eligible believe investment to cross the put, more our be help to wider actions investment and align common Simply to an opportunity needs we section stock as value stockholders. We to this size long-term

our materially we levels we our debt. debt have While down ratio, to continued commitment leverage pay believe reduced justify our absolute

creating is for position sheet achieving and We enhancing we we of focused these acquisitions of objectives. XXXX We in position continue believe our to short, return one beyond stockholders. on to method course to In company continuing company we'll pursue value should both strategy, success this to stockholders. balance value believe the believe accretive capital our for this proven our long-term staying

will call that, this questions. for we over the with turn Operator? to And operator

be Please And from from ahead. question go Truist. the first will Dingmann Neal

for Paul, on options. to I'm with Stronghold of or now operational when question release. time. Thanks the like sort did this it got optionality, sounds a obviously press is you team just wondering guys. But my comes you lot out you've morning, a for lay Good the it more

my drilled wondered, does that out with question you how and how are. of far guess the just is, legacy you've of did I kind kind Just lay there verticals the many of and compete year-to-date horizontal know sort maybe thus to I over the plans what talk

the they how And between So -- or plan? how two? I'm the maybe is have you just the for the much for in optionality returns you wondering, what compete guys

a bottom Yes, with their this. to came going economics. stab the view. undeveloped have go points a line give very ahead. guys acquisition of of share to And I'm first is I'm you opportunity competitive of let kind going at couple very, that. But The that

Some to of actually date getting thing. cycle into time of you the due to type them oil of short [indiscernible] date the tanks from the superior are start the

And so North Shelf -- the past time, [indiscernible] We've same across Northwest this about system in and Central talked with now. we Platform constraints. at respect Basin to have CBP the but the

have. tried attractive in other the program. spending capital And the primary programs programs the and capital maximize have North South, was drilling up our we quick rates the the to returns, saltwater of also our very and efficiency times, we and payouts efficient our have issue very limitations. disposal. very Well to infrastructure We've turnaround But in programs undeveloped of that balance we

We also electricity power there, or also grid constraints saltwater down have we disposal constraints. and have power

investments generation to it's flow cash infrastructure from we where minimize not assets, necessary. so maximizing these the And in are trying

it infrastructure where We are a necessary, it's is in balanced but program. making investments

on associated the are out, -- South. turns economics best some of are as so or drilling with our it in the the vertical wells And some of

from And economic impact from the it so have for and they're a very standpoint robust can perspective, very robust of an very, they're company. the

there's And so know more don't any I how if need you? say, I about Marinos to

contracts year well I'd terms only is are -- add, optionality, rate that this Paul, extensions. well The our to in thing with of all to well

So secured can both wells. same terms any commitment The pivot in projects casing, commitment multiple at in the long-term multiple We we've there's -- thing of casing areas. for with point. no

-- infrastructure the accordingly And gives flexibility surprise. of to us so by we that lot a might with that constraints catch adjust that

the little bit freshwater that the SWD terms the supply in on restrained. the the a constraints. about, South call, have the The is we South. In we saltwater, of been constraints a SWD visited side, those a in The also constraint of no longer last has on lot resolved

So just made of we're resolve great have the most facing pivoting to headway really a trying -- too. kind also for electrical part which and we've the supply those, there

ahead. Great. And, my sorry. -- go I'm Paul, maybe leads Go that ahead, into

is these This and Neal. Alex. sorry, Paul's piggyback to anticipated wanted some Marinos We comments. and I conversations Yes, questions. on off or specifically echo of of

you revamped differences we So there cost. question our every kind deck. average well if of you well well XX to the what our it of little vertical your have. deck, on go really and and And a tackles a between in you'll the giving for that really But that IR performance feel horizontal see more single is Page well average the is a blended we clearly bit

high high one of reason yes, fields specifically rate on greater when spending very the to NRIs really And asset. capital And Paul some our very, you the return, because that that’s very is economics will cycle that in as vertical is due time Lea that short even investments be and so there mentioned, PJ asking wells, are is there. you’re

at Page XX you So for XX, a oil. flavor and IP if get look will also present you

focus Slides we the far And of are obviously our investments. capital XX, kind of In return to XX, as to so really rate as question. going the highest your optionality, answer both

thinking great That’s good right. that. I so the of way thinking was why today is going [indiscernible] to $XX [indiscernible] I is, are to at, I is ask of just how Alex, or up thing it Paul, lot average wonder here just future, let's getting out curious relatively like jump stable how to you to I was some to down because -- prices far. down just having the XX, oil. to I stable is Yes, like kind spot mean, follow-up your for then of you XX would thought it there's be more different wondering be that’s be just sort guess I what recessionary And I look all little on easiest details of be same times, goes like call those, before what a plan, kind I’m you’re you because sort and that. I today the why the really same way down question you’re my we under I want or a has on fears. plan. is the the to prices, going in Oil in, been Stronghold. more, you or it anticipate was know, gave on there, Marinos, on still one saw to if there some seem leverage a goes you to forecast already bit of so answer guys

Paul. you about my just pricing just guess I think question sensitivity, maybe is So big when

Yes.

asked -- and has who only question so the one you’re And and this not privately. online

that we $X and And between of [indiscernible] $XX in Henry assuming budget prices between $X. are shared and our $XX WTI and Hub so plans

time, So just ones flexibility got let's limited spending change versus just can. of drop capital to a the period highest $XX hypothetical, we below we prices our [indiscernible] if fall to oil program absolute

to we're so, repayment stick this year it to going we’ve and debt or one way And again, got another. goals

at production, 'XX, January this averaged look we I so the high-end if okay. of 'XX our production got year, January's for higher than January our production capacity, And guidance we for example, know you mean, the

this clear that should we very that discipline going year. are a be capital so message to And send

And so discipline that capital related price. is be to to going

scenario. opposite the take let's So

where on in So $XX the have growth to same port to above that we we versus do And let's limitations do subject time these ability organically. system are will period infrastructure. we [indiscernible] want got that to you Alex, or say something? we’ve $XX

to our here, comment Yes. range Paul's we had [indiscernible] to CapEx echo, for guidance, try bigger that also you look on if And to at I a that. also think

answer question, Does Neal? your that

guys on. You spot

kind thought. that’s think I I of what

is think that guys position. I fantastic Paul. you you, in Thank

Neal. you, Thank

Jeff Tower next go with The ahead. Research. Water from is Please Instructions] question Robertson [Operator

Thank you, Paul.

You've closed the -- playing anything Stronghold for having capital you've for those in did learned your since acquisition owned you and them or operated X the months, there August you diligence program? and XXXX that now you've X a is since significant in assets is think about role

Yes, we agreement. I say every day we there's bit about quite as purchase acquisition are signed will bit sale a the we we've the learned. this, today are as this and excited

things, We things. little a on these. evaluated wellbores experimenting of and so to trying this may because expound may have Marinos, of We've of We going bit condition learned because we many case But of instead the up different that of turn more through and we that's he several by completion efficiencies, those wells. techniques. over a to other I'm completions think up condition can are the recompleting, many basis. of going wells end end the be to increased wellbore case the those redrawing

superior and actually South earlier, to the in just have realize We that portfolio CBP the to as demonstrate mentioned do had before we a have even certain we Alex by come areas little economics acquisition. the

we of came truly economics but the Central competitive the Shelf this acquisition rates the Platform, in Northwest -- and So portfolio. are with in that and return our the these economics Basin acreage in and of knows everybody opportunities and have, strong that very are outstanding legacy this how

And Do operation? so the to that. we're about anything you say really, more really excited want about

just I'd is thing we’re that, said, No, the only excited. Paul add as

more stimulation an we're six decline. little some production in from and projects, were actually found operations so and and the increased we've We've significantly cleaned performed wells our and where [indiscernible] out acquisition. excited gone standpoint, had the actually than and forth, we we've on or five think side, I doing PDP a

lot learning about it excited. good really extremely feel about we We're asset. and a So the

we testing assign I'll that the some PJ add see that McKnight are and during future a think fields of the you'll have one we got on that too. and some Due some the of share thing Lea that we throughout even acquisition, other value assets. more to several us And both lot nature didn't those proved that in valid, results. I calls, concepts certain of

come. So more to

Thanks.

rather on because recompleting, follow-up then you wells existing Just zone a then think redrilling a better that go that, another casing? a can and completion being and is than to I use in have maybe you quick just get over the and broader able

That's things. This couple of combination a a is of right.

of of what condition and do the the [indiscernible]. also With casing and kind [indiscernible] job quantity they of have the

And know, wells. fracking these we're so as you

the really lowest the costs the so lowest exploit risk. And objective is and to for resource

thing that recompletion have you just each make balance that. factors them one all seen, it's associated we EUR so with is superior the And a of a call learned the that and wells new producing when those tend on We'll of as individually. But rates, results look have opportunities we've we evaluate at one these to of wells. than

And driving what's primarily that. so this is

Permian, you gave in what in. Can more Stronghold the acquisition that are And the a lot of options your in build of types Ring follow-up, as Paul, existing to asset continuing just projects of the terms invest base? scale you fit a capital briefly Ring mentioned characteristics describe to an

and are the turned acquisition, was [indiscernible] with think acquisition sellers, it really because chose question. we it what company. don't Basin. the the assets very we're a a offer we every nearly that for they very We structured, that type not fortunate and of first for negotiated Platform And Central it way with board and a the provided. We're and wasn't that's the to doing accretive good a assets. out But run the the prevailed I that I in very on we Yes, area Stronghold similar that across -- to as lot through for our metric a targeted metric. analysis Permian set still We process. those process that being very, a went of result decided on know of it Basin assets them accretive and sufficient in to the them, be on. of this other did It

going that. a And to it's lot so look like

-- we that's what our target. Now

mean and the doesn't that is like assets, that of been the up types end with because certain Now assets. we've looks we'll others marketplace that have we approaching being certain in it. something And reason that approached are just

be showered find our But development the would got willing to price. in opportunities opportunities costs, a long and the so preference project production, it of and with And that least inventory. similar our we current do if lowers PDP we without or have existing is then that for have a has buy to lives at economics we production, declines lot PDP have right operating that our competitive undeveloped

Jeff, this the want inventory said my buying quality. that's by I in dilute quality stuff of lower don't to I've the past,

I Now, and economic. portfolio to you, our And rates I be honest of they're there quality got out of lot the companies undeveloped have may quality compared lower of, of to there's of opportunity. that with the be a returns, still very the would robust envious

a down size that more are what but out So do it there, company out is, opportunities that there being can there take we are opportunities by our ourselves. that that there of believe we believe

and made, structure a excited it the the about existing the deal of XXXX. my maybe debt, be It's reduces really is strengthen we're the to function or in sometime it shareholder, goes. there's but sheet. balance not again accretive believe to we And how a that negotiation in whether future, a actually that transaction do here, so And way reduce all XXXX we can

the so main criteria. those And are

company the dilute we that. can generate. financial again, the this performance want really But and like metrics don't We of to

disciplined. PNA. not going to going very types of we're we're to be to going do buy not just going buy We're so things. bunch a of not to We're those junk, And

that So question, your answer Jeff?

It Thank you. does.

good. Very

And Okay. our is Tuohy next go Please question Parks Noel ahead. from from Brothers.

Hi, good morning.

Noel. Hey,

some PDP needle have I for your would being not out evaluating done what might little things a But they are [indiscernible] so properties just there be you about already. the of there for recompletion last comments Actually, a move where apologies acquisition. that on there? opportunities on based could consider the meaningful acquisition, late, covered value With

operators was, There prior are of are it's really Basin, known who And their Greater actually. Central hard. and Platform properties the Basin Permian There to the Noel. certain work the operator that a all in really, are function

there's so capital have And And their elsewhere. those they've spending operators many other mined that focus opportunities. already then of

as And assets be as so their worked been of could having not classified some hard.

And so of benefit the that was the acquisition. Stronghold

capital If you Chevron, some elsewhere. Stronghold assets found for They they assets they their some and from that developed look they that had time. allocated and been tried ideas, those quite at those the position but their capital -- managing Devon acquired

these left and of so us. now opportunities behind And for Stronghold, they then type

kind on And Platform classified what the but, identified opportunities as Central quite some there maybe Banking we've but well. out would that whole yes, you are assets other a so not saying -- are PDP, much in of there drone there of itself, be areas lot real Shelf, Northwest pretty in were completion opportunities,

a lot. thanks Great,

And the next question go be ahead. will Please [indiscernible]. from

guys. Hey,

acquisition. making great in suspicions a about? a clients. help that? money, the from paying my Just not one made market we're we're down question, that I our getting We we're out hold record But the there We've me numbers, stock are talking What explain you share. got $X can debt. Can quick keep maybe

more than of investments marketplace asked actually really the and one the one out get the like. other I that we best as gas Ring Energy to question why seems it to that you argument kind back understand. the believe I in in lay go are is space. And that we it oil stand presentation, probably question a marketplace. of the and to today, investor undervalued that's tough as any The Rick, if as

so prices. hit since change with the hit the smaller kind harder summer, the undervalued? And than companies some bigger in we been a fall in have industry that know hard has is we've our We last companies. oil so know And been the stock category that little of that why of disproportionately that

we're my or opinion, superior better lower multiple. But trading has generated in group. our at Yet returns least a ring much peer at energy as better than good

the would And marketplace, so of -- that quite investigating to bit happening. divesting been a and what's of explain take time

and believe we probably And with debt think a company that have. that invest couple to contribute levels the people organic things that will in going that, from some I But as there out, sheet a very you our not are a are we're, so of sheet, I there that we're to debt. that, really and addressing soon strong ability point to balance down just balance rapidly quickly have pay a

to can And similar something do even if we with that Stronghold acquisition, more. we sheet what we the did can balance strengthen

call be not better with us you John the you to question held have Rick, on or as Alex, them So that to you, for or down. who probably of and some say? but honest some are than do too is is but I'd analysts insight your in Jeff such heavily of the would terms hate addressed we're something that follows penalizes people think to probably want Neil to of have Noel being why more I dudes, White today, that,

something to you say. want you Alex have

performance would the that add a X of first as comments I do. Stronghold for that is months. quarter all announced company, also I we our full the this metrics meaning all

and a And Street lot the public waiting so to that of the is I see. think

So now, quarters watching the we of us start acquisition. that you'll the of underneath company, seeing a really couple effect performance get once the of

also throw here. I'll Yes, a and in and more bit question little I

converted and Travis and X.X cover, million As X.X into warrants just million this were shares converted common shared, exercise quarter.

overhang to oil around. to or returns, marketplace on investment of out it's we do why market to we the sheet, and temporary, similar believe generate long-term. come when would of to eventually at our a it stock the is our if ask. believe has not people there, we the lot are so And Rick, overhang? continue to an that questions way impact, that the there there I we why is believe is continue an an on out that These types I if performance have its is, the look going is the And strengthen the that be today. and considered all the that space, represent right peers, I I balance is opportunity companies a compelling most reason continue personally other there things, gas are

Thanks. Okay.

for Rick. question, You’re the welcome. Thanks

And go a Tower the Robertson Jeff is from follow-up next Water Please ahead. question from Research.

went lines versus and way accelerating balance prices the high-end along concerned the capital If with up do people -- if of deleveraging? in increasing deleveraging? how $XX, to back $XX, of your the Follow you budgeting, you're leverage are

why Yes, is gave time, encourage we spending and because that an of so extended I change fall of example, range programs. or us to really XX, period again, part that when the and use $XX, $XX you our below to for sustained would reason capital of XX, an as

from I'm excess down operations the pay if take to going to Now $XX, additional at debt. cash we're

going But we down again, bit let's above at a we're was what this of of But if sustained be time, say shown we're probably yes, paying expect then above we're $XX, the than we've if sustainably also is Now, successful more well, get could it'll be year little yes, type for capital our providing going negotiating these factors debt. at the But the going to something drilling up spending the now a of our as, other down pick us And because period just on grow to least to add we guidance. bucks, XXX so things? do and here. marketplace we capital preferences deal bring bucks, the Will believe that a at we're purpose size, we will XXX there such organically. in to have are dependent deal? I

more. spend And XX% for gets level we'll it keep versus the probably year so well at that if EBITDA our the or capital below XX%,

could numbers. higher EBITDA and at a to deck, support So also production increase commodity you base higher both grow the deleveraging price

So lower flow to EBITDA numbers, the and leverage theory in you which through valuation? get should higher

reductions It ratio certainly repayment the where even we could would. in And is that around leverage we we're believe scenario In point surpass [indiscernible] I or potentially year. debt the scenarios, itself, type to below of one. though the Yes, down even yes, of for coming up. our goals those EBITDA to types could make substantial

thank you. Great,

Ladies there gentlemen, questions. this at are no and time, further

back So for any closing the let's conference remarks. turn to McKinney, Paul

you Thank for us today. join the call Okay. again and your on interest

XXXX. are looking to We forward

about Ring's what for do We can are very shareholders. excited this year

we we diligently with in We the meantime will from working focus call are again [indiscernible] to strategy that continue hope the laid Thanks And us proven working on but out. the the for hear today. hard hard joining value and for we’ve on you. be call, and next you

And for sir. The thank concluded. you, Thank has today’s attending you now presentation. conference

You disconnect. may now