Magnolia Oil & Gas (MGY) 23 Feb 212020 Q4 Earnings call transcript

Good day and welcome to the Fourth Quarter and Full Year 2020 Earnings Release and Conference Call. All participants will be in a listen-only mode. [Operator Instructions] I would now like to turn the conference over to Brian Corales. Please go ahead.

Thank you, operator. everyone. morning, good And Oil conference fourth call. Magnolia year and XXXX earnings & to quarter Gas’ full Welcome Chris President Participating Chazen, and and Magnolia's the Chairman, Executive on call President Chief today Executive Officer. Chief Financial and are Steve Stavros, Vice Officer;

or conference the actual from As of and projections and the securities uncertainties in to results risks laws. materially These implied that contains other a call expressed certain cause statements to statements. forward-looking differ those reminder, within subject may today's federal meaning these statements are

Additional risk with is Slide with on harbor on supplemental the Form annual factors information safe results that our found presentation filed to available report X data on could on differ the XX-K company's full be cause SEC. the A in website. conference the can slide on call

fourth over Mr. Magnolia's Investor from slides XXXX www.magnoliaoilgas.com. I turn quarter conference release, will company's at earnings the the as as website to download now can Steve call You Chazen. well call Section the of press the

Starting you, plan us of capital Thank sufficient and free model morning will on and how returns to cash update a and since we've maintaining on company low our reserves, generating on developed shareholder joining while presentation The in update investors. which results, organization. for questions. – to for characteristics focus quarter our our will giving XX% comments operating by including you moderate we today. drive thank we we We My XXXX. the a employ strong drilling our consistent provide EBITDAX, before limit financial we a us supported thought growth, also review that year-end business helps characteristics few X this discipline appeal financial the the and margins. ago, of flow Slide business model allocated within Good call shows our you flow on some and was generalist Giddings also would the how activity. Chart to and Brian. progress your throughout leverage, instill morning, Chris take pre-tax XXXX cash spending fourth years of our to spending full year with additional whilst disciplined our capital significant conference model guidance inception

While cash for this not The year available drilling, XX% balance completions around and now enhancing within cash be bolt-on completion Since million. result, need used repurchasing will remaining adjusted the been to most averaged capital of our unallocated over either that has a basis, Last we significant oil drilling flow to EBITDAX more also cash our on continue I a spending properties model, a guiding gas period. per XX%, cash value with infrastructure XX% and of no has of this or built will has build quarter, acquiring shares. of principles amount in cash. reached, $XXX small share longer as And we enhance through the flow to a end been the We've activities. indicated change. business to share limiting

shares plan, million Aligned the approximately and have continue under with generally X% share this each authorization. currently would fourth this X.X XX be to We the of our absence count year. We increased for quarter, In be the will cash that of total small repurchased cash expect acquiring acquisitions, We to we X% available repurchases, shares flow our our outstanding. an plan available our share which additional for recently authorization XX.X property million shares. the in repurchasing most our approximately Board unallocated flow share overall continue repurchase shares of shares of Magnolia to reduce or used by bolt-on would repurchase by shares. space million either used repurchase the

quarter. much Just the have, the stock it could and is for cap be, this to it small, how but the first fixed, tip quarter mid-XXXX, against paying not cash could intends – activities, begin price X% we second depending per dividend on clarity, after in to Magnolia a we we more the value-enhancing results. semi-annual Addition paid cash our these than view the X% dividend in announcing be

a in and strength the of outlook. the will most The focus our be to be total based XX% accretive second is around capped in a full additional our moderate to to the cash The results dividend, shareholder dividend annual also time XX% to confidence This overall this value. underlying variable activities. plan net year dividend element growth of allow cash The business this assets. our on our flow with providing include income. fixed of of Distributing us will the deliver that XXXX within demonstrates cash continue next time plan on cash reported current unallocated flow payment to business paid year that's financial outlays at dividend of enhancing the of component production combined to manner will remaining spending our allocate share is executing flexibility

made our advancing last a year in we to to mode significant the pad multi-well from appraisal development. strides Turning Giddings operations, asset

we Giddings continues three for would on drilling Total like rising in resulting our pad. two this Turning early XX% overall both basis. with times asset. Results reflecting quarter. lower XX% per development and cycle drilled quarterly look a faster cost. of stages in sequential completing for how the still wells wells, fourth Slide the and of in a to to or improve Efficiencies Today reached have well X increased in production the the quarter in record asset fourth levels Giddings are production oil presentation, production

plans wells, forward and pads. continue the our larger in increase we field. pads four should efficiency to to consider few improve to some a may Going help This

average We expect million approximately to year. this total during $X well cost

cubic in the performed area. initial With than to Importantly, wells online brought continues total of feet in day. XX online This a XXX better and area day, new day feet has wells last for XX,XXX-acre in X.X by the of average fourth drilling oil a million average in improve initial XXX of core previous core increased X% of the and barrels well oil of million X.X quarter level gas per gas barrels productivity six wells XX cubic days, of we These wells. XX prior XX production wells area. rate for per of the from this have the the day our the previous

XX-day wells two of be located time area gassier. a barrels in our rate oil XXX of gas an area to miles about at away feet average and Additionally, had wells million day cubic day. core in we the completed were These expected initial from XX Giddings X.X per that of production an

better While these provide than amount had This wells of area could production we potential oil the proved additional to was originally for time. high return estimated. be gassier over development

from we policy Improved remains prices around twice spending ability our XXXX drill basically running have last is year. We're significantly with us efficiency to the has of running what levels, were capital product provided of pace in at improved the one year. This currently area, XX wells unchanged. to per rig core Giddings Giddings. the development discipline Although initial XX a

And Karnes to We the increase our modest operated area activity half in are in Carnes. also ducks expecting the the plan year. non-operated mainly in a complete XX of during

although be is be adjusted – the XX% Our and XX% this of current between range. of lower to is likely at our to XXXX EBITDAX, prices DNC capital product spending half in expected

think running that probably behind say XX% we're and too. that I this quarter I into could second way quarter, level the

with it's XXXX. the in build In with providing back we out year, that very of a and as the us going during ended operational half momentum to XXXX financial up. solid catch we operational us strong benefit So, be difficult to should performance, summary,

reducing on F&D dissolvement We at outlook activities on enhanced further of margins year for lowering We while and our per full and Giddings. per pre-tax remain cost, our our G&A our the improved are earnings focused costs, share. unit metrics, and we're optimistic

turn to organic year, a to production share reducing the digit The expected result result on which year. I'll EBITDAX include growth Chris. now of production in per digit plan doesn't to call of adjusted to our of spend by year-over-year That dividend the payment. completing XX% approximately mid-single share Our count per growth X% over mid-single is and XX% combination XX% growth. wells drilling, our

Thank you, morning, Steve, everyone. good and

adjusted million total consensus XXXX the proved reserves XXXX mentioned, for review XXXX operating The to generated Magnolia’s high-level Steve plan per $XX and or end and quarter questions. diluted X. of some were for provide over before was guidance ahead I of $X.XX financial results share a quarter convey year from some fourth Slide Starting net company points fourth income quarter net As and share. around reported our thoughts it on estimates. turning income some very results Fourth well strong. and $X.XX

due was XX,XXX the sequentially XX% exceeded oil Giddings production D&C the weaker fourth approximately sequentially equivalent $XX product keeping And year. million. an of guidance during was better after percentage quarter XXXX of capital online adjusted Giddings our represented the lower guidance product wells did despite much with expected hiatus and as D&C production Total completion than at quarter. high production last growing XX% production, EBITDAX was and higher of much fourth started adjusted capital day. a year due Our the total Giddings of Giddings as production capital. product of stronger model, with prices grew million earlier performance. better capital quarter in barrels than and costs with bringing XX% non-op weaker improve the during adjusted the and the our prices, well for to our in per XX%. prices fourth to full EBITDAX quarter in D&C to business XX% Magnolia a eight-month end of our drilling earlier EBITDAX for $XX year. oil Total grew Production did

quarter waterfall capital. from X, fourth the million $XXX the $XX on quarterly of flow flow million cash at before changes cash we working generated in Looking with and cash operations chart began Slide of

proceeds During quarter, to sold million. for costs the has Karnes. transaction gathering or the $XX impact ironwood our Karnes at no interest cash is operating at transportation The we in system our equity

$XX million quarter included shares or including our X.X $XX on XX.X leasehold the our authorization. quarter Board, leasehold repurchase costs of ended during was capital sheet. million fourth the million have the of shares for We during year the our generated total of XX currently of remaining shares X% we authorized outstanding. cash during repurchase million million the additional We approximately D&C common Including with total the million flow balance repurchased shares free recent costs under Our $XXX cash quarter. – $XX the for and million by fourth stock

to and small bolt-on build potential significant dividend during cash cash share of plan payment expected discussed on and we Steve uses small the including of property based our – XXXX. a amounts including free did As acquisitions, during the mid-year, year, not repurchases

$XXX $XXX debt. issue did million has reflected million our gross our XXXX, plan. execute of is notes, in any and we senior do million ample Magnolia expect $XXX our an debt to undrawn liquidity new Our than which until mature not more credit nearly revolving total is facility and of business to not

Our year condensed liquidity on and X. Slide balance shown X of are end XXXX sheet as and

Turning including and costs cash and under our looking costs BOE. adjusted per margins, to unit at Slide full-cycle $XX interest XX are our total

Our DD&A which productivity compared were by Giddings almost to improve. a as at we levels. ago costs, twice by BOE had has Giddings roughly $X continued declined rate fast helped drilling to Well XX% is wells year well to as per declined

through with lower our results seeing as costs And evident lower F&D better costs. is so we're

Our full last cycle year's fourth XX% the fourth declined of to by compared $XX.XX quarter. BOE quarter per for costs

margins based margins lower and the at our despite full prices. to quarter current compared cycle and fourth We cycle product expect structure significantly in cost maintaining on around the to quarter recent full doubled current prices product Our XXXX, levels. rise most would a

on a excluding year barrels XX.X Slide during for oil The price and had successful drilling million program acquisitions revisions. very drilling Turning XXXX reserves to organic our costs equivalent added related and of program D&C last year. Magnolia end adjusting XX. after

XXX% F&D $X.XX per supportive drilling XXXX for This in completing level developed for and F&D asset $XXX totaled our replacing costs is and capital our production. base. our XXXX of current BOE XXXX of proved in million of wells DD&A Our rate resulting

to our XX% XX% continue EBITDAX completions to capital Turning we for spending be of year. facilities our to drilling the guidance XXXX, between total for full of for adjusted to year the and expect

range. product prices lower our would capital of of be likely noted, that at current Steve outlays or the As percentage portion

plan the complete year. initial We year be expect We to run one Giddings XX and operated wells planted and in our which during area. in between in wells to Karnes of DUCs capital on XX drill growth pads is plan activity We rig levels. at the production modestly and Karnes the to XX,XXX should to complete deliver XX area, core multi-well last primarily expected brought day the to most produced mid-single year to to online expected per Non-operated basis. XXXX and digit year-over-year during increase BOE compared and activity XXXX of on during a first our half is

fully approximately continued as combination diluted of to expected expect purchased production in X% per million share we The of from our Our We of the organic XXX and decline our share XX% diluted fully were production to continue by count fully quarter diluted in year. XXXX growth reduction shares this our the shares. digit year. to nearly this mid-single approximately is growth result year declined would in shares of shares the prior through fourth

although to be the quarter now. of weather most The XX% operated levels, quarter continue a be said, we due activity to running it's current benefits with as the our to to start is the the of in the latter first majority during complete of incorporates second EBITDAX, the a of seen quarter. Looking rough be cold part Production quarter quarter quarter, estimate bit In field. fourth capital production Giddings. the adjusted of the to downtime same impacts in in some of we approximately the in estimated at the to recent completing approximately which the plan DUCs of – our lower D&C our on right we focused Steve Karnes, expect will first plan

to In the likely Oil items. these impact MEH and per related barrel of modest additional addition to $X costs should a around discount amount associated production, similar repairs be outages to on also we're to see with ready weather-related to and positive other to differential Giddings positioned to into the from historical results take to this into momentum your XXXX. expect gained questions. results levels. Magnolia year benefit year is In and now continue our summary, we financially well operation last We're

[Operator first ahead. Instructions] Choudhary with Sachs. go question from comes Please Umang The Goldman

and first My Good taking allocation on question morning, framework. my questions. thank is you cash flow for free

that have and acquisitions. flow free bulk the balance big and sheet towards mentioned favorable bolt-ons dividend share in given you You Giddings, Can cash repurchase, of your results small strong provide – you the framework and a of cash dividends? how how about potential about flow in should between allocation we flex And thinking free think are purchase terms between going forward? like share versus

at producing of don't the our looked because historically, They're we us percentage we to went We we acquisitions flow costs is acreage so might as is There to fair – So had generally some so to cash finding be that duplicate dilutive our buy numbers. acquisitions. point. it need a really something to costs stuff, low at kind our near this dilutive of finding acquisition. that or assets probably but an couldn't in

cash. to should because small not how you We're build I So might now. that there's nothing any right some probably much think going don't know be – there things there. but

would be And or payments sustainable dividends. so semi-annual a view there'll small to what as we

million, about year. a expense $XX is Our million only $XX interest

of our want So, whatever as EBITDA. you out we say to can

it'll So and count. X% it share depends I sort of be have are If small the pay. we'll we stock rate. will in end Otherwise, be fixed talk to quarterly or or weakness from we how year really down reducing we'll that. of our size. successful year buy on how do – number. maybe the look at stock in At thing, we number the much relative that in to at that something do looking we can a think don't to that It I addition to a the a semi-annual need dividend now, the on

we But the question over product and answer special we're dividends could be for the know think payment see your price. a really current but above stock of big a to need we from to hold, going don't if We be. increasing how also thing, how and would year a prices dividend prefer now. I basically work dividend to forward, sizable – fairly base put the there'll money the So the

plenty at cash. we of what not going point. need we're cash for to hoard We got this So

So it in successful share depends just repurchase. how we are the on

a think the that's number maximum. not, but… the you not X% number, a as I helpful or quarter minimum – X% if don't I should know view

That My is is super the reserves. follow-up developed helpful. Thank on you. proved

F&D on have sub to XXXX, proved costs in a respect get XXXX. expectations attractive cost. Giddings to Well thoughts productivity XXXX highlighted to wanted You versus to per $X your to cost add with reserves lower in in XXXX expected be BOE developed and is

the developed You the added both those provide here. highlighted reserves? off proved XXXX, improve oil that the mix for to if potential in which And XX can oil also mix of you is them what you there's reserve of million

be the ultimately give here in somebody the here year this for the minute. get basically in similar but filed Chris Giddings finding be to year. of between of are will mix K for anticipate in what was We one pads. business, pads you and the the a close percentage Karnes we that this We'll it you will think give We costs year

So, we're look pads this from at as year very that we what you to number number say a up – PDPs. those moved looking conservative from sort move and could as come add to of going at we with

we'll give So sort think you oil number tell a that, of I we that here you and in minute. this

about the after reach you We give reserves. have XX% proved I out call. oil. oil. the PDP the to on can can you We're don't total We breakdown

you Thank be That'd so helpful. much.

Anything else?

The JPMorgan. Parham go next question Please ahead. Zach from with comes

your of imply but taking an guided X% do or in I year I total my to activities the will X% little first Karnes Most the the about XXXX. to oil growth in on growth have which Thanks oilier, you what for guys. you in guess would Hey, production half, question. oil be a guess, DUCs for that in mix the year? for Giddings, XX first

how can drill We want. sort of anything manage that almost it extent, To we some wells. depends we on to

I the were percentages fourth but time fourth So, and for think guide, in XX-year the as use purposes, be a career, quarter numbers for planning could to decent. understanding that, prices my you gas

locations wells the don't of day are and lot going development we you, reluctant of wells, where in spend to our in we know drill could half on Giddings. year. guidance. would we're end guidance numbers. development, And a on areas. outlook, we're it half barrels much the out the Obviously gas more these year, of that's we're giving drill in Depending of We so-called in XXX laying And a how for oil. exploration some high up parts program to prove the back of talk to much are that how an through the of second sort produce why gas may spent the we And we we're if we the additional maybe of about we all of the the

Thanks.

you Giddings So XXXX. XX about in I wells guess that's when in to talk drilling XX

results. That's rig’s a single

Okay.

not So the in for XXXX. that's necessarily plan

No.

it you're not the of delineation between split of kind a give to core And area like development sounds ready area. and the

more to back in of half see happens what You're year? with the commodity prices waiting the

plan, waste we prices Yes. I and money. we don't want have Commodity to a mean,

delineation on it to want And or whatever spend so, you we want call exploration. to or

However, and confuse describe doesn't is a program want the and it, we way to thoughtful people. overwhelm in that

drill original strong competitive. thought Karnes. at in was results the so mid a of been And But then are the and Karnes fact – rig with pad the think we beginning add the not go have do didn't year, drill wells that in our Giddings Giddings. to So the

half going back is the year we're thinking we're of And that a so manage in the how thoughtful. way to

it. That's me. for Got color. all for the Thanks

ahead. Steven with from Dechert Please go comes question next KeyBanc. The

can six want Hey, Thanks. guys. ask to? new the there wells at performance the of I that even really area in core you just driving Giddings. better that's point that Is about to anything there

well, this wells to to view tend we simply as the view better. it. is we tend in There's all the physical nothing well to Over – about time people to It's really Permian, from not. same complete all and how the learn learn to where even drill they

you how where it's locations. data, complete efficient more And become But fundamentally it so, deciding by to caused in accumulate experience. you make as pick more you're better going also the and wells,

caused or So by it of isn't moon something. like phase the anything really

But drill clearly less hole… in the time

time that's you a the When hole, – I get drill less better mean, Less in yes. spend fact. results. Yes. you just time

great. Okay, me. for That's all

Thanks.

from comes Dun question Please go ahead. Johnson McIntosh next The with Rice.

share here could color morning, keeps Appreciate you all XX, to share back oil you you sticking those XX how kind at was or Good we I it higher comes give Steve. kind If or have for some on the repurchase, would those XX dividend wondering the up? prices. repurchase pull prioritize kind where and the dividend of maybe if out context to and when to stack it or maybe XX, of do of a the program. the

Well, views fundamental time. have about potential some over we the company's earnings

if prices, back for whatever is. we didn't so in year going a And obviously it the into $XX oil plan there's oil or pull

pay for basically indebtedness. interest price. it to of shares plan to to we million. debt down continue per prefer There's we real would we growth us more so, – expense no get gives because no There's We cash, our is only million and more repurchase that real significantly bonded lower $XXX use have share. And to oil $XX

that's just – don't use. a likely I not So very

shares cash we distribute are the we of company if remember of shares. probably think, shares, shares, that I management purchaser And useful and so It's the purchasers sellers not seller that. of to of have also, not the excess is

push our So price as up our goal. to is stock goals are the That not possible. as much necessarily

of the is objective Our opposite. sort

the On hand, X million other own I shares.

wife thinks are So, great. my dividends

sounds you've pretty inventory talked like able Karnes you've as higher what all at done get been to question, Thank preserving In past, enthused Giddings. one prices. oil Okay. maybe you And then just you. operational for are the

what of in today? plans the kind could this you there – point would at that if that, for revisit pretty we set but at Just sounds got Karnes? like, are half some break first you of year, It least you've

wells don't higher cost Karnes the the compete payback that the much with Giddings Finding wells. and is is similar. understand You

So in wells. return much the rates of higher the Giddings are

less you the when plan, drives plan this returns true, remains obvious, – allocate as as you sort going be like doing on and PDP of our will whole long on on to least obvious because we're doesn't was stay type other this, compete. what wells, at less so, And to Giddings and that's light we're it as as us. we And avoid acquisitions, Karnes, about if they talked – to long heavier it that Giddings, is going

If you have shall say, just an need cautious money, spending growth. industry time, that's challenged you about for over be really we to

generating Just and to not add, returns. real

look you interest of finding sort If EBIT more, calculation DD&A little our like for the of cost, the at bit but like rate a taxes, sort and it. is

but So, try are in real will is us at to we're want an looks Karnes not make time. And Giddings are for for earnings like basis. what there The actually that going throwing better well indicative to like earnings long by of money and well time, degrade the a we the program bunch over that of to just staff. don't going be the earnings locations But a either away.

you. thank Okay,

with question next Please ahead. The Tuohy from comes Brothers. Noel Parks go

Good morning,

Good morning.

that was much $XX ended curious I Giddings. year. any than in price range, about talking more a are And they possibility? nearly we as been have of become at prices we crude improved we're inventory think, does about the I have, Actually, non-core the with where at as now where this

Chris?

inventory? What

out. cut You

significantly come any sorry, acres, in close the that prices the XX,XXX of core to with does outside oil play So now? inventory being

wells it, those two way so-called drilled wells. gas we in Well, two outside

there's So, XXX barrels those as day are clearly almost oil, of lot also. in of a environment, we this of more They probably and oil. economic had that said, a

is hand, we're return not locations other answer run we're soon. our anytime out yes So, the of going on but is, and short dollar, high these the maximizing per returns there to

Great.

on sticking already, – sorry And are sort with for planning you crude, long-term Or as are your baseline this you… but mid-XX number? of you are your touched you if

so gas. Yes, and, XX or $X.XX for to XX

gas. for $X.XX

great. Okay,

not that’s think I new.

bank. numbers are in those a the Those to I wouldn't great I planning predictable numbers. record take not gas prices. have, of except

Thanks enough. No. Fair a lot.

Thank you.

from Pope comes Global. Please ahead. go Nicholas question Seaport Next with

Good morning.

morning. Good

question expecting. had expenses. lot was It on lease a operating was than a I I your lower

for from a half ramping restart operators that third activity to lot great Seen look everything second quarter. oil of the the the So, kind year in dropped workovers activity as and of up started with number quarter. lot else, up, of other climbed a just

a to was to as be so, should could that about drop know fourth necessarily, I activity talk guide quarter quarter that where and you where haven't expenses And are, bit third ramped like, where little we operating to I has you – expect hoping board? but and up we expected

the a comes lumpy. So, production of other considerably. workover up activity the the point numbers sort and makes But real, the it and is goes is

down. come So, BOE has the cost per

production and found that We at in also were the lowering on we didn't looked thing we sort of fundamentally – rightsizing number. year, we every made some things have that do, that compressors that nickel, we're we some when through went spending and done, we doing, valley we of death, should the second now last the

those what our G&A are our work keep on in work things finding of stays our control control sort on capital barrel, we work we fix. So, operating per on cost we cost, under we under that control. to and can We

focused we're So, this very on calculation. this, EBIT

it it been So, fourth a for for the not the up otherwise but the it a have this loss would lights from be a same for more, could lot wasn't will similar the it And be fixing from to wells, the – if – quarter little more probably quarter, first little be that. more production, the there'll but the leak.

costs? you clarify comment about – the was it. see it Ironwood there don't wanted I That a you sense. And sales, all Got to makes expect did transportation

No, with original deal. the really anything to it came that We a encourage. didn't do was passive investment

they from deal. out could we $XX and same people could. never we or cash any it cash. small Somebody running weren't any than they generate use it. were who $XX the earnings, We much. thought wanted bought but generated We who million And We offered that million us not the of more before, a generating amount

that we any contracts took partially it So, was or like but owned. it, anything always new do didn't because,

So, of we a third about it. owned

else had it. And somebody

we the So, the a And contract. and line. a our it's we're had always major contract customer market on of

would would activity it. our know would you maybe just we better that So, guess who what than bought be, somebody and

All I I needed. right. it. Well, that's appreciate all

you. Thank

Thank you.

next Securities. Neal ahead. Dingmann Please with [Operator Instructions] The comes from Truist question go

Thank Giddings. anything order, Steve you acreage of partnerships that drilling question, acreage and you more? good so in have in the obviously you. or consider like advanced much acreage that all maybe my Would

to give like away Generally, I don't money.

why people deal would is some guy got mud, play your the to the into dirty. I that, So, get I have in boots time to problem going a used this he with do for with the I dealing you're to expect the say, well, trouble, who worked the you every

So, are in, fooling straight very well. to We going make of around forward, are your would dirty. is goal more if cost – the run guys, he boots get simple these you you somebody business. The to he finding some $X If with not brought business complicated. the want

you do anybody way only don't long I always, it over anybody, And could when prices don't a time, period started I to oil But over just able the the whoever value has out guess we know money do stretched correctly. this why the three So is in of successfully Even used business, years I I there. oil was ever ago, time. would though still I that that? – made

So put that aside.

paying that here That price. I optionality and a that in there, very would process prior second was knew lot get a place was low I my to guy same I sell is be employer, how the out thought of really Giddings. going or But some who thing. – it in in And thing strikes be for oil I knew to and The would is not there is my that me got for as, lot much option. didn't whether wasn't to you've not. optionality it it’s fun. to the of successful know or boots, dirty a

these I on you just the just answer. And days were or hedges in and like littering Chris what hedges, general? thinking in the

especially – about a at mark-to-market the prices other oil and goes hedges, future. negative on losses principle noticed always had results, difficult, of gas, to And a looked people's view. I I've that on estimating huge the is sort predicting I which

don't to Goldman little below believe Oil you over head bit with some some in you And when But expects get activity if read And don't prices. he protection don't so, buy don't full this to of you is really hedged I selling wind going average guy time. get it you that money. of up insurance. philanthropic I mean, up are the to gas. free. to runs where need a make we we He for is Sachs sort that, and fluctuates

carry But the him. the wasn't insurance, low beat cash. we do the we quarter, second debt capital changes, it second if fun. we and not average, the the without going might the except went went some anything, losing through have that. really using, through We buy And below selling survived that's don't really need you to the quarter, for on could you working you get time, are insurance. why all we average to But it for Sometimes protection price

yes. hedged, all Yes,

that were know we some forecasting how one is do, things hedge. to of prices oil And them. not on There’s we

seems like money banks make wants to Steve. to the No, It hear. only on those. I'm glad Thanks

ahead. Thank you. Go

The This today's attending concluded. for concludes session. Thank you also the now question-and-answer presentation. conference has

disconnect. now may You