Comstock Resources (CRK) 4 Aug 212021 Q2 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Comstock Resources Second Quarter 2021 Earnings conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions]. to Allison, conference Chairman like speaker to now Jay today, and would hand over the your I CEO. Please go ahead.

gas range trading natural as that for very on for as in as the natural I strong gas have a now Again, half that first know were Europe especially which our the that morning today, LNG primary looked as entire this gas of we this quarter the front-end natural see we demand well high of see Haynesville introduction. sector, industrial for you loading actually at feedstock on while about use We we second super high part Comstock for earnings Mexico. this are know second And capital half cooling the through the aware we're I disciplined natural The XXXX thank we and the gas XXXX across today. to electrical Global advertised is gas what low-to-moderate capex But gas dry and power excited looks year. gas generation stage in demand is gas supply with at ticker, is plus year, natural exports to due $X really dollars it expenditure in of of selling in for and natural oil record we're corporate you the as prices. did. production of reporting that. solid and world I the for that heating, we all as season. well are

XX% as high net net X,XXX within plus XXXX drilling as footprint, operate low-cost structure, of. XXX,XXX Our corporate strength the in lies which well Haynesville/Bossier we to creates our which locations our acre best-in-class, margins our

and do at want goal our XXXX. took XXXX in the fourth the steps at senior the Xx and second which as look our to we leverage quarter possible. being recommit tasks our third our in less reducing to with XXXX issued notes of if the was XXXX ratio the in than to wind end of our feel forward reduce you sails and XXXX One before or We with we cost mighty of quarter major of X.XXX% capital, of

and Haynesville/Bossier to lift our decades operations With over is Comstock a family Jones possible. billion proven department. refinancing are many, our per many denominator quality, Comstock, drill. bondholders, our of and committed our we in in by rock, rock is consistent this Tier by through about his place, that to why And number region, that we why Jerry I after The our and $X you, years. quality invested the quarter equity buy quarter working speaks quarter Comstock of Haynesville/Bossier reduce reduced especially continue mcfe denominator in X departments, is after $X.XX which have XXXX, drilling interest results owners August proven quarter if since that quality all to that year-end XXXX, that, believe XX% to of costs banks results know volumes and that rock we the

call. Now to Second and formal Welcome Resources Quarter start results. second XXXX Results Comstock XXXX I'll the Operating the Financial conference quarter

a quarterly Quarter XXXX can you'll website Ron Operating Officer; at You Comstock. view Results. presentation present and and office Executive find to by www.comstockresources.com a There, I am Mills, Burns, of Officer of me Jay this with Allison, Finance presentation our results slide and presentations. -- Relations. VP our Roland is Investor Second Chief going our And entitled or the after during call downloading

a Slide X, note will that laws. forward-looking and our discussions statements please Slide X within go you include in today of presentation If refer to to our securities meaning

and statements be expectations assurance correct. the there believe that prove will be While to be to reasonable, such we could expectations no such

if go adjusted of second quarter net the Production per $XX the million share. quarter income the was approximately of X. second day averaged We reported gas. highlights XXXX quarter second cover bcfe or highlights. over In to the $X.XX we a and we'll for quarter, XX% diluted natural Now on the X.X Slide

Our hedging daily share. quarter X% was diluted including EBITDAX quarter or the higher Operating million Adjusted was $XXX per losses production XXXX. average the XXXX. the XXXX than Revenues, $X.XX of quarter were the quarter second than for X% XX% flow realized was quarter second of XXXX. cash for million and than of million, $XXX of second of XX% first the higher quarter higher than $XXX higher the

dividends, quarter, over $XXX to million. the preferred we cash flow good goal the million. flow start free reaching year-to-year free generation increasing our as free cash generated annual cash For of $XX $XX toward That's our flow of a million

cash goal senior commodity that above lastly, cost stronger capital our come the now million. our of flow the going in With of free the half well notes prices of in of the we quarter, of in we're expect second reduced the coupon we higher substantially And completed second to forward. year, all task seeing refinancing $XXX which

payments by will cash on a our issued The expense quarter. used $XX annual If million X.XXX% cash we interest were The refinancing we due significant remainder I the of senior will are reported you the proceeds redeem as $XX our which annual X, million. our X.XX Slide transaction million, annual reduced earlier, with basis, reduced mentioned bonds. XXXX. interest to was the completed forma from the the the cash lower we in offering drive expense mcfe turn XX. and beginning that produced, improvements assuming over refinancing transaction, per costs payments. of The in by which also refinancing to on million interest We in the interest Combined notes, save quarter closed at of $XXX June pro recap $XX new refinancing interest our March did, were

per a $X.XX to compared mcfe been the interest rate cost Our first second would in quarter for as mcfe quarter. have $X.XX

In years, it years. X.X up senior lowering more we quarter maturity also over the now in improved to review detail. X.X addition turn weighted our of average the to Roland of notes Roland? from to to for cost capital, our results financial our I'll

gas All production last gas right. Ore for and our reported recently financial quarter completed was Slide summarize had than we driven of our On this of for second of the the production X, second results -- Jay. Thanks, total the totaled stronger quarter, increase we where of over X% higher XXX We we natural production and the oil. with had X% an in we this quarter barrels bcf it and second year. and it's solid than quarter combination first Jay by had totaled a year. said, this XXXX, that oil second XXX,XXX increase XXX prices in in quarter. quarter was for X% were Like

realized year. $XX.XX price sales, result, numbers, same only including including the the year per the gas Natural contract in -- program, the of from than realized of impact our by of quarter quarter better our mcfe; prices the XX% barrel, NYMEX as for gas and that last NYMEX Remember $XXX and hedging we oil averaged prices those averaged a $X.XX. second $X.XX increased per hedges. gas Our to both losses XX% Oil last our averaged million. were

numbers in really see run-up know prices I in -- is starting gas you'll recent those forward. really So July the

up costs side, of production. kind Looking in our at the production the X%, increase cost were about matching

amortization Our our depreciation, was XX% quarter. and noncash and G&A in X%, down depletion was the up

our early the loss of loss $X.XX contracts year. transaction. the was of and charge retirement for $XXX second $X.XX unrealized higher $XXX XX last refinancing higher report X, million $XXX adjusted half than excluding financial income, million Our June from on certain Operating the fully all year. profit our cash diluted We very XXXX. this early second the first a on it's related and hedge results of $XXX loss senior quarter hedging retirement EBITDAX million; mark-to-market second notes of items, quarter net share. million the came the debt net loss a quarter other of million, a but Slide XX% Adjusted of the $XX in $XXX did and summarize mark-to-market million was in XX% of flow the was at the that unusual per large a we to due On or or of share, per to than

$X.XX per and of hedging, than including of six first prices this year, barrel. X% gas is lower both XXXX. first prices and our totaled any those first of That $XXX per and barrels the of our of for year the But averaged which months half that's gas bcfe. XXX,XXX XX% of that's over oil the production million, and averaged $XX.XX including realized have losses up were our That's sales, For XXXX. the production first the of half includes year. than than the last higher realized XX% impact XXX.X about higher oil, hedging for last year, half XX% numbers, mcf; Oil our

loss $X.XX hedge debt of both the loss to higher cash period, per March and higher for early adjusted was for and XX% overall, unrealized than year. of the year, June this the the the million mark-to-market was refinancings of charges last a or million, share. half to $XXX.X For reported flow Again, same our first And XX% this year. related we've due $XXX million, extinguishment position. then that this on of we EBITDAX reported Operating period than $XXX last

items, those hedging share. we net our Excluding $X.XX profit adjusted recap per or diluted Slide program. $XXX would X, be million our income

$X.XX from we the That gas selling had During reduced the of we hedged. gas our quarter, second gas production. for mcfe that our actual per volumes realized realized our from $X.XX price XX% mcfe

versus We hedging oil our Overall, $XX.XX price quarter. which resulted of realized also volumes in in the program oil realized realized. to our had $XX.XX of our losses decreased we $XX.X per XX% hedged, million barrel the about actually

in are those but natural of covering this us now have feet remainder to year, this is XX% the the we fixed which swaps, seeing. give around XXX our price prices of per higher production are of XX% cubic half of For we're million the year. day, hedges hedges collars, exposure expected XX% second gas which

form shut-in year, shut-in us the for the we next a almost this on or And shut-in front. summarized we have substantial of expected our X, XX% storms or exposure to production, give is we had that in other XXXX operating really in production activity that seeing production shut-in, the came which were had which the year. to activity. mcfe. quarter conduct had we Slide good the had XX% hedged. those And we our about XX quarter. during collars, to routine day substantially and first of in now shut-ins prices related of to kind of disruptions and to We of that matters we XX% higher the or quarter, detail due quarter the and quarter only very there. cost we are X, For a quarter. There we're We second from X.X% during good significant second a our the On Slide million X.X% down offset no next were per half frac primarily On the had

per was end consistent $X.XX than $X.XX came rate in came $X.XX rates. right quarter. Our this kind very $X.XX of first XX the mcfe to to Gathering depletion taxes the XX. XX. quarter. Slide balance $X.XX of very G&A and the forward. That, the lower going XX, second which than the It's quarter of the Slide the end operating reflects what the we at and June costs cash that in averaged quarter of picture mcfe. we second and in the produced. higher the refinancing expect had $X.XX, quarter, remain We was year. closed It's in to lifting the the month expected at rate. overhead to in industry. amortization -- $X.XX past. field at in do per the range this It in $X.XX lowest the the it again, depreciation, the had corporate first Slide and what sheet That cost cost of at again, That's $X.XX And in at quarter. of mcfe in $X.XX were were one quarter other $X.XX, transaction, comparable very, our the we've our the in of right second end on per a and first second the quarter,

new is of cash senior our flow reduce year. designated on of of continue We XX, billion company. the XXXX year, see So by free senior just can a X.X% cash a which Slide generated probably due outstanding. using new you we that right free of next debt. They're our the the due the then -- in schedule. really the that's of permanent million of maturity $XXX end quarter the -- And million facility, X.X% X.XX% billion issued borrowing we ended do senior issued with reduction part which the We as rest Park moved at $X.XX due in is the notes, base. drawn senior being retire are as the generate new Covey million notes and That's really revised $XXX that total we bonds, that to sometime we were free early flow expect of to revolving targeting continue $X.XXX credit And notes the X.XXX the as to flow debt now on that cash We of XXXX new XXXX March. using comprised have $X.X -- We about currently plan XXXX. our to notes reduce assumed in in second acquisition, billion to quarter. $XXX in

And the second now years X.X now after our weighted the the see notes of of our so right senior refinancing, quarter. can average at is end that maturity recent you

as we're interest and on debt capital otherwise Jay on to in great substantial And charges on fixed of the generated So be shape go have annual our improved out, our substantially service. savings schedule. dollars have maturity cost would that for would pointed what

sheet. million with on in we end So quarter did $XX balance the the about cash

Slide million. So our $XXX quarter at recapped we second the is expenditures. XX, capital liquidity current

development to the in that second million and relates we $XXX shale activities million quarter, Haynesville spent our So properties. on operated of $XXX our

and XX quarter. completed or XX in So recently wells we we wells, Haynesville operated operated drilled or net returned Haynesville to second XX.X XX.X then net the horizontal sales

activity We million nonoperated and on activity. also spent development about other $XX.X

$X.X acreage. development million funding new to leasing we've addition on our invested program, In also exploratory

to a shale drilling Given the tremendous in our putting $XX to increase up spend program, to leasing future. of budget success that Haynesville to have of on we in leases our million decided new maximum program support the

very As to attractive good do terms. we're that seeing opportunities at

our kind as we're for we So operated XXXX. ahead those over drilling into will operating rigs a right XXXX go five five see currently maintaining and look now, in minute, of as program, Dan we

which level, right we're at So a think, company. very for is consistent good we the

flow free delevering we the target that nonoperated this expected million on a cash significantly plan, spend net current focused $XXX of to when prices, generating increase this then drilling XX balance free of this which of what and accelerate free higher-than-expected really also use to to significant we will on current year. changes gas We and cash wells. flow. that the year. our based happen Most timing expect $XXX XX flow activity. We'll beginning plan, incremental completions So are due sales to operating million in is very with sheet. turned small And wells drill cash to about original $XXX our of we on net for million now the the at year's definitely exceeding of about is This anticipate of from the

back So of now I'll turn to on over to report Dan it operations. kind

Thank you, Okay. Slide over Flip XX. on Roland.

we rates additional all see map X,XXX -- completions. turned a rate. the feet. wells the per up this were for to to cubic ranging X,XXX a ranging feet XX,XXX quarter wells our average new new up lateral or list million tested cubic the in You'll feet, The the way summary day at XX for million The from of XX outlined an the we've sales. Since million average day of to a XX last of feet with feet call, wells XX XX well day and had at cubic lengths feet IP from

additional So wells wells in have listed have to XX various we we in we of stages here, the addition completion. that currently have

are That's today, remainder activity flat May, to year. levels next the for where at of activity Regarding intend down did our this we level drop five past rigs. to six and year this into the from and hold the we we

three currently wells, for actively benchmark crews. X,XXX updated our in stream XX we're currently Over lateral as Our long an DNC running been our XX% we're of lateral count second at Slide on call all XX, fiscal DUC and quarter, stands than frac are have of Through year turned feet wells These the the laterals wells. length. this greater to end wells. the long sales

D&C X% And first X% a the During to total compared the second quarter, quarter. year total averaged cost. represents foot. a This $X,XXX is than higher XXXX D&C the full our cost increase

This increased to to first quarter. in less second attributable Our but primarily our still first versus quarter XX% drilling lateral than the costs quarter, a average by is the cost XXXX. X% in the compared lower length drilling

costs due that from with Our running But And lower number quarter. remained the X% XX% still to in higher to completion lower pumped first fracs of we're large the were cost year, than costs. increase XXXX, a completion relatively XXXX. flat which smaller the only led last is this the

expect completion flat, foresee For the year, not increase in and remainder of our material will remain do costs. the we relatively we any costs

So company. June. by our for expect is our our basin currently the building performance Also, laterals X,XXX we foot first this benchmark XX,XXX D&C spud X,XXX, range. keeping our in drilling check, two, that we're cost on the we completion long maintain and in to foot cost in to This I wells lateral want that current total drilling leading add for

to wells complete during expect fourth these the quarter. We

increase drive further where spud down in longer will been. efforts the going to XX,XXX of our These wells to we've are quarter completed than and additional we our lateral help that the lengths foot that credit two drive next our bolster costs; cost first footage to have down laterals year. later also further will be We this month

to to it over the going turn XXXX outlook. operations. that I'm to back summarize So summarizes our Jay

we've same before Dan, We'll report open short sweet. for Roland, pages, conclude it. Okay, a It's that's and here. questions. ten about we up usually good condensed and and That's it

you at we of to outlook where summarize XXXX I'd remainder look XX, this you If the Slide year. direct our outlook, for the to like

said, Our a XX% as operating than plan maybe importantly, in of that. to provide free and for most this X% is flow generate million around and maybe to Roland more production excess growth year lot expected cash for $XXX

we've cost this focus primary reduce our our that. lower to Our our on and which improve year sheet, great is balance capital, strides of leverage made

transaction with the our to June annual million payments. another capital $XX reducing and cost Our was significant of step refinancing savings interest

will natural reduction, a debt we on low-cost structure, Roland to Now low-cost in of of that anticipate as of on remain our further said, with end stay focus returns the X.XX our the down than price leverage free absolute of our primarily our North Haynesville million of all this drilling XXXX XXXX. than improve we bonds the focused retire, expect flow XXXX. the we'd cash our end our improving levels, industry-leading we current XX less and gas from highest We $X.X it generates maintaining And plans based at structure well of generate we'll the the returns our at year. ratio XXXX, on outlook, and best-in-class industry-leading If current and drilling leverage some to drilling less and improving to rest at America. prices that seek would to ratio at end with program

We'll Haynesville/Bossier as sourced $XXX focus million. also as inventory currently have lowering drilling liquidity, of participating to the strong gas of responsibly at emissions drilling on mentioned, in certify provide very and Our our of programs us and decades we locations are Roland greenhouse inventory. gas evaluating our large one with

year. give I'll any Ron, rest the it of guidance now specific to the Ron? over turn for to So you

Jay. Thanks,

this Production the for the the of guidance X.XXX On we we year. had page, previously day update just the guidance remains at number per that X.XX provided. to guidance remainder bcfe

million has on our And year. leasing currently rigs add at increased million time, running we development million as As as we $XX we're capital continue remainder to is to $XX to acreage. the five mentioned remaining $XXX $XXX earlier, And the the million. over same mentioned call, of on the at to the anticipate guidance the capex

On the the items LOE, cost the prior unchanged all really from GTC, cost quarter. side, remain

on And so side. hit the answer from that, cost I'll the all With our questions back to of there's to -- our call to analysts. targets we over operator the continue turn

[Operator Instructions].

comes Derrick question first Stifel. Our from with Whitfield

With first my I budget. Thanks, on and question, XXXX revised capital your to good morning wanted focus all.

that could was on understanding the the the revision focused frame dollar the nearly XX% of you the is arguably With leasing, help accretive remaining on side? components most the spend, of increase which could development you

But very nonoperated obviously a returns really seeing a said is we have a in of despite only are -- high and lot what have down given a participating have able and That's opportunities. seeing the modest question. It's Haynesville, bar other we Derek. increase good higher return. in trying set ones a it's return, we to prices overall. We've more Unfortunately, been ones are that Sure, the high that the them actually -- to very lower very sell a investors. have high

not to hard it's So those. in participate

So really that don't it. notice that's and difference this last can get the we why level But understand between control great and you on happening. year activity year, given of don't

where wells. dollars on side, have you the we complete of operated lot the the actual when really control that, a depend do we On

the consistent drilling a little a relatively stayed and times. and have now, that's achieved drilling We actually same, bit operation probably quicker we've

the budget, Do year? be all changes between really -- really and Do it's when year? dollars our $XX it's constantly hit And into the It the they easily this the can million That they looking did very So and in time so we're at actually actually based timing. $XX fall? next go just -- that. million completion difference

fall budgeted numbers. kind really those of laterals XX,XXX-foot takes buckets. a different laterals, estimate. of especially very, at into exact formula now and kind X,XXX-foot a laterals to wells the between very, way. projects developed past, now put that exact when comes footage Ron's we've better X,XXX-foot also up think in And to in looked I The with that And we've very and three think and probably, I them credit, our the the

transparent well now. since see really guidance to So the you communicate we be that of numbers do it's given telling us kind and he's want that. We And we that working on.

My Yes. quicker forward comment, them, They moved they've there's move we've than forward. want. we them only probably but efficiencies, managed dollars

just that So XX% selective we try by is to being of non-op own managing, HBP. then we manage what on very and opportunities

we this So drilling program. manage the count kept We've flat. rig

think the I job really can that's historically Dan you has drilling pretty a a We've on now in done completion got side. lot side, quicker. good predictable the see and

you why be So bit, future. move we did think normally But will in some a is we have. which more accretive that bunch the adding a of DUCs of to these have increase That's Comstock acreage, wells budget forward. and we than we today little just that

Great. drilling lateral D&C Makes when and I And per cost trajectory me focus sense costs higher the that per Slide Roland's to comments to on to follow-up. you're lateral me. foot. really, really wanted foot D&C my on it Referencing build laterals. shorter your are makes of as complete sense XX,

the of further cost, As XXXX half you approach look How feet. we of will into flat out into your the about XXXX price/activity think XX,XXX laterals out a and D&C assuming should trajectory environment? second when

be you to those below eloquently will but foot, We think predict got early we've think it's that, member, if the to footers. a $X,XXX XX,XXX a look at XX,XXX foot. costs again, Well, little XXX,XXX it, we

be to the wells there Yes. averaged see feet. you great saw impact you the on -- at example can that over first quarter happened looking dominated quarter, that and the quarter by first the And from laterals. longer A where XX,XXX savings significant is second the

of continue of XX,XXX-foot could closer being excess we the mix, kind first get long the average lateral into go can we type laterals if to the have where wells quarter as So to was, of to in averaging we and more that lateral length back completed.

Yes.

So don't Dan, a you make why comment?

Yes.

to the got longer the about comment lateral. we So

mean, a several to a in if not So if lower. in longer. can we've up, we're by confined the wells Texas that you're our side, obviously, coming And that's lot get those number that three we laterals get We have at to is three one pipeline, buckets. the going $X,XXX one, two, ever of I longer goal on where sections, And get below already got average foot. we're more especially

far shaved still back end of mean, we're days off ten I we've As the think starting say, from, an XXXX, as XXXX our average I on in some performance, see improvement off through the times. average. the XXXX of We've there. think drill drilling slight I we'll of XXXX, probably times ahead Haynesville today, the in early

given the So do? the numbers service mean, those just here. relatively the we got from I you going think now are that's those got what that market, cost, already We increases the us be between cost I modest. think of and to end year, And then the will

It's I -- year, to how mean, just but next be know will prices. So higher prices, to there much? the we at on be there's going be going pressure upward

maybe mean, and cement drilling a numbers not the little for products. on see and the the some of steel of kind on of inflation we've I in picked some inflation we'll those kind -- see side. we'll worked but completion service costs, Well, bit side,

with question from next Piper Kasope Our Sandler. comes Harrison

question is My gas differentials. on first

to into you if correctly, recall returned of the understanding differential QX, to better into and Gulf the QX your like mid- gas redirected XXs. impact I could the the you get arrangements. about toward and a you So from Perryville, of Coast the being from XXXX, was QX wondering some and model new expectations had range could your in if historical and talk I also I'd away of

we attractive this of question. we as the had the a would that's we winter Yes, thought in storm And us prices gave normal in premium first differential benefit quarter. All the quarter. first obviously, good a Back right. that the much quarter be to for that

becoming of very to extension you differential quarter, of improved similar. this planned better. and of in kind from quarter alluded you Fourth -- is into coming in probably that's gas kind is Third Acadian Perryville to hope potentially market a marketing away with we It's the still be able opportunities to the that's to -- when hub, move $X.XX kind service is -- we service. -- hopefully, kind come into $X.XX, where be expect of to what get the $X.XX which October, additional

our a Now way, XX% have percentage we of right some Perryville so kind hub. be is to that really of already of gas gas moving we'll now, our -- tied that only expected. and Like we've

to index quarter That you next major us. definitely the in number price out down of and the to when it's kind actually year. at fourth hopefully look looking you're So drops XX%,

the has shaving to that So start differential down. the potential

those -- And so don't are really moving we all markets.

can't an to hub that Perryville from will markets at So away the we you to hub from we're if available don't which be $X.XX get going different selling do are could but to more it give move Coast we you're where because that -- to number Gillis, because just in anywhere trade and to going is trade new starting on pick gas, to us, that's exact we'll including all know we just $X.XX market and able Gulf want up to move Hub, that today, directions, those down clarity on is now to at.

relates That's to cost great. And then my inflation. next question

today. of -- on detail had the already you You seeing some you're some had pressures just that shared

thinking it. thrown how As a about head how A in you to XXXX, And like cost guys large think of get are aggregate? be about of thinking rough you XX%. about you a player inflation have guesstimate Permian sense we do should out I'd

Yes.

we date, X% few small, what ones, like seen have I off think small been really start really to we've and they've and -- so we a seen to really just less. -- with

that's say, year, why think So for we're pretty good. I I this

where year, Next on think we the markets going. based are

good on higher. to probably a probably, I we'll is number. a X% average, pretty year, little next And think think I XX% be

any of from major is indicators our any really coming. providers got anything haven't that We

I just you higher -- there, just macro a We to over think level, that but just XX%. just it's activity. certainly the at I have see know don't anything

side, No, and I a lot natural United natural States. either, see whole again, for discipline. gas on the we in drilling think, We mean, rigs, of see capital I don't XXX rigs, there's gas the particularly

in of frothy So was you stuff. days rigs mean we -- if a a lot increase. I it might see before new that don't expect COVID, so

discipline, capital side. this to just with I see we're inflation going think are right runaway on now, our

I has If utilized on cost commodity up, the and gas up. being hadn't oil probably as have Now wouldn't commodity both side. our we side rigs gone price many the mean, today, of gone

controlled. I those that range. probably be costs. it again, in to our that think includes, And X% on includes it to includes number. will cement, So will X% And be moderate, That's it's some going be steel, inflation tubulars, it

your And then on is? latest me, consolidation. wanted wanted just just Just thoughts great. I area, where appetite appreciated. about I consolidation your the currently That's may. within I to be to ask thoughts one final would any if hear a Haynesville/Bossier for

will the the I high low-cost that be think Well, of I your to consolidation, speaking think of you're kind think, important, locations. more of because I I that locations. lot I denominator and some margins -- probably think have is your running And a size these you is out is but also consolidate everybody mean important. of companies

to for were Park with XX,XXX Covey were those laterals, with ago Dan years X,XXX we our departmentalizing of program been they foot. beauty to we is this added bought the that and and to when like think Comstock we've locations have the billion, locations Roland that with and $X.X that leasing locations, we than larger I those X,XXX locations X,XXX-foot X,XXX, and Ron we've adding said, two

type for need because box that at looking to locations, X M&A to. needing you you're if of So we can Comstock do don't some

these and you're and for of anybody. particularly to drilled completion management, more If drilling wells looking up mean, their we from I side, Comstock the than side completed

don't probably you need to. So

right bonds, I with the equally we XX be we million We in that. the company, was bigger, I invested were through in to we're structure we great of the there prices. the got them and improves. have expensive shares stretched the to the have great And commitments seeking high think transaction I get just returns of had demand fighting that M&A blessed overhang. COVID preferred, were We've beyond now And were our to XX% lack as A or an have while. that our that that is RBL our we Coast, acreage transaction. and out delivering The The do with and do schedule. that cost personnel. a that the we We've issued equity important. a the would Covey year But we by any owns for fighting margins. maturity the Gulf private do mean, to would don't again. the think size of quite XX% to something way frankly, as while. materially for lower because The with or to is kind for they've the Jones for -- We're family Asia only Series so -- while. reason farm that looking is LNG that valuable I Europe. was shape, the we're that is with consolidated that. We period. transportation We've what not cured footprint We're We fighting a not to period.

are management, sweet million. we EBITDA Now like in mean, solid production solid I of pricing spot collars. swaps, are have, them hedges proper growth are think you cannot sitting XXXX in realized it. the I mean, I we're hedging and half upside, we of with have a and $XXX stronger-than-expected half our But balance with sheet into XXXX,

think go whatever, those I but averaged it's we've of Some collars $X.XX, $X.XX, to a mean, XXXX. program like I in safe $X.XX.

looking So anybody. not no, we're or fishing aggressively for

are. in are we think Now we line. Sure, needs that colored it Sure, are. But we I to be opportunistic?

with Meade question is next Our Charles Rice. Johnson from

little were ask a with the and to about bit on the up you on Jay, pick I you Bossier. just touching wanted locations theme

really have since it zone. of couple of Haynesville But eyes. remaining is Bossier. was ago, really, more focused the in with few half guys the people's years you have who really remaining other the companies then, back, quarters, some are my a of good there in half first And lot you or markets the locations, just last been opened transactions guys a wells of capital that locations, on Bossier of the impression think I drilled have the really than

in in Texas industry East much see the and the of kind detail whole for give -- as Louisiana can in like, versus you as Bossier specifically? for you'd as Haynesville, the you a so of -- this Comstock And a this Northwest both footprint view of how

Charles, we've name closed behind how times you cover. face-to-face-to-face met Einstein. many is nick I and is your nickname with Yes. know But many think companies don't how doors, -- you I

incredible to drill Dan to that bring wells to going hadn't to just it quarter. The question, the to We him But he's to -- to So we that whole supposed didn't I you brought calm up, one brought but the about know that. bring up. pretty turn be audience if best ask ask over the because I'm of we anybody because in type this ask that tell wells Bossier we it's you it want needs to okay? didn't the it Nobody up. up. two We hit,

I think are our other they Bossier, half you and you if really Bossier. groups, outside sniffed of the love that probably locations out. ask And then consulting

you a is vine IPO, upside If at half their of look Bossier.

to I'll you Indigo, Bossier. Dan. really my crayon, If with is great, you That Bossier. question. talk it look great color at give it's don't a about won't I We

you. Dan Dan, So Charles, and and slide that. go go to thank whatever, you over

Jay. not your Anything crayon. but Please the crayon,

a cowboy It's blue. blue one,

Yes.

in the IPs XX XX,XXX are, the completions. is think can like best that Bossier I And quarter, the drilled which here it's Bossier income longest wells, last where on we -- two mention you but the laterals the Sabine, Bossier. on and the XX,XXX. on on Parish. We are of the date are -- on two completions see two play southern of Slide the down exists. we didn't was at it list. to half wells, I Bossier if this Obviously, south bottom in the in map, There our list have had there do the only a two two further the the Those earlier, -- fact, which those Charles, So the they're

was So on Jordan later a well. drill laterals are are XX,XXX And that was be Parish next two the Bossier's. acreage this there ready which Bossier XX,XXX border. on to Sabine a also right getting Desoto, going foot we to foot That test, the month, these

we do like is Bossier. So the Bossier The good.

well wells. we December This XXXX, when Jordan We it well. -- we Haynesville it's to in a going we drill back of Haynesville/Bossier drilled kind public in Bossier go kicked interest we're just off -- know, as a Bossier you well. all nine And parked you the XXXX, the of the company. remember, announced of the XXXX. Charles, in wells built as first And is world,

of play. rebirth did report We in Bossier spark have to detail, it interest the and

about be They will -- foot really we're excited challenging. they XX,XXX So now these laterals. are

we've got a I recipe. drilling think great

they're the Of wells, a other to kind bit. course, not that's drill means, mean up of foot learning the laterals, in any we'll get XX,XXX little back by I our plan. the curve we routine have like but

Bossier As laterals those we of get down, foot these we to long laterals. XX,XXX plan our much develop with

to that probably acreage. we laterals the longer the on our Yes. to -- That's to to is migrate the one percentage or Bossier just laterals comment acreage. Charles, more laterals too, of relatively that's a into can much about do XX,XXX the thinking our XX,XXX the Bossier add the foot Haynesville more been foot of as that, one lot can we there's realistically room in is inventory want higher Bossier, that, we've things on undeveloped And we a convert

enhances that So -- returns. also and that's

some the operators market out now. long-term great And are the been many all Haynesville wells part we've the best of so realize to that the So drill thinking inventory. just go hard different wells think to that plays to and been about of it's we have and I because the But are of more a that in yet. to such Bossier large the a wells play started It's coming inventory.

of been the some Bossier. non-opportunities have Well, and

surfacing. very it's yes, So

of to hasn't. color, look, at guys. drop look tighten. to now And asked strip have that's I time. $X.XX to spread that and would spread But lot of acorn squirrel me a couple March probably we've look, then. frankly, calendar that. or April. this more it's get -- have kind The -- you'd interesting long is a the appreciate still great of -- maybe finds to if is closer. Well, an between going going I have ago, as that's A going weeks to -- are it those me I couple a months you a tighten blind and said, every I and ago well, been another, there for But question. a of ask got let less

curious, so I'm of fourth drop or see any of that in we in of decisions And of longer the does that curve steep affect near-term month either or any term? does the that your shape or planning and XXXX, April your

think go really gas I of market the And there. The be that -- -- question. in and just on you the could good those months winter the gas market tightness speculations gas the a really out that curve, out that the longer in the the speculation the short fear and that's nature is the probably of Well, that -- less there.

winter a kind of So be lot really of until it going there is shows itself. out to

quarter the we online it's January lowest of those you of So year XXXX get have I be same some to be comments of mean at price your to you try going kind this looked could in the want -- around be, out that. could that's to was March. to through the have to hard year because plan made months that said not of first and strategy that last really to are gas XXXX. a great turned It of going

do at the see So XXXX long had stuck they seen was that level you've for the really at where improved been it's over overall, last futures curve hard that toward We it. time. month, really prices the XXXX to rail greatly, look a though, below and a

lot to it year, trying is like demand they're out. just supply later a to this going filling So look what it is market out the and the still of figure

component. gas about great it's market. the feel we a producer big discipline, And been So

I three happy. is in if and I the pretty you rent. XXX, have I'd like ago, gas natural months XXX Well, months, next told mean, seven to dropped looks I'd pretty or it mean, XXX me seven better, you I to the out, be way that but strip good. right the I the looking Haynesville, on gas four look XXX mean, months now. we're as then Charles, it eight at,

So did XXXX. front-end load we

because that. have have question half then In mean, risk-adjusted in good have or that I a to a do hedge really same of a sheet, the When If we XXXX decision, hedges, business our that yet collar we have budget I XX,XXX-foot In that's laterals, hedges moment, the And made $X.XX, X in a I -- that think $X.XX, good of to at asked wish not think and Haynesville swap, swap of we you is said that properly I at our sure I they collar. hindsight, pull to we in we good. get about XXXX, look our we Bossier. think and go And X,XXX-foot, that other X,XXX-foot, but XXXX. a in have is businesses the any -- but we quarter the we the balance thing south, I is the have are We've make $X.XX, little our think think, models. you if whatever did did, also run, is how hits case I a is, both which solid. didn't something which gas first And hedges. when the we've bite quarter

going I a kicking be need of DUCs accelerate and long also think the back PDP, that. those Bossier, can have out, we to to laterals So when these in off we start little this bit some to if toggle models we we able do the And into too. we're convert

able wasn't many off continues do not a a three. and to be We per can that, Covey $X.XX were to we to quarters need now $X.XX. drop. cost bond. to get mcfe, that If we going our we're It we're two pay then ago, the think for interest that, I on mcfe

natural about like a corporate it really, know like really second I I here, but gas the mean, we're year, going to and the all-time opened, on natural of gas really, But we So -- really half this should we look third production really quarter. high with fourth talking production capitalize price. good. looks favorable when they quarter, we're the second

All insight see same thing, Yes. it. that appreciate Jay. We the is helpful. I

Umang Sachs. question Our Choudhary with from Goldman comes next

debt My reduction. on is your plans absolute first question on

can generate free over gas favorable. million. it flow if mentioned, of you potentially very holds, you And cash As well features $XXX are

to $XXX facility? have back credit And million you and around the thoughts which talk pay your Can you return the to right to absolute remaining shareholders? you you once to to outstanding borrowings plan our plans cash deploy and talk maturities your shareholders also, debt facility. if down at You level your on cash can the credit on address to

remaining we in Yes. do long-term kind down the focused questions. the Those a on the of maturities great really now facility can that we of amount the because a of we reduction. -- the also got good reduction. did bonds spot. are And a and debt have of got kind It's are -- for -- great obviously. debt that we the thought debt we've bank retire target we significant the outstanding not cost purposely that then We refinance debt And was debt,

next. remaining in So our pay the bank We bonds. flow the those to create sometime want plans year are we'll facility probably X.X% to next first retire obviously the bonds free cash and and redeem then

a And repayable that's that our reduction lot so gives the help us couple can us goals. overall achieve debt -- next of that debt of years, over

I the to will properly meeting dividend, Benjamin and variable. dollars to doing have pioneers board a get XXXX, go can six, we what? Then goal to you on in leverage a be we're just be what And do a and These back number, at think that to nice going but you hey, dividend. it, If to look dividend. world are this a our eight, going? you But can real know start I hedged. are get is take of nearly handle going windshield think I are It's a windshield, the in one think seven, we the are prices, at the down. you gave where down. We're higher have these a one got look there say, We with not say, the the you a not only stakeholders leverage it giving and

the built demand being are facilities export strange these market feed our encumbered the firm and that kind for we're the commitments below are we of haven't gas within and structure commitments that transportation minimum at think or our onerous. that guests absolutely I as Europe some gas, to demand where as growth far fact volume the Again, with our because Asia of is our and located. possibility a Comstock

long leasing So that we same we in to XX drill are wells, every on the to program, looking time, months. absolutely the the try year, XX ball XX at more we replenish XX And XX, at with our next XX, locations.

the is that So goal.

to I don't be financially Now spook are the the reckless I want to never owners, period. equity mean, bondholders, anybody. going we

You that. can forget

to financially we've the and help have debt maturities that aggressive. owners, down, the the will We and got these and owners help bond are equity have going us. paid be it long, And analysts

goal. That's end we're our So the in the together. in all barrel of kind same

get wanted your thoughts future helpful. guess remind my your around That's around to hedging. you Can production need And us also you of for was hedge hedging. to minimum I And I next question the percentage covenant?

Yes. currently we're borrowing developed of Yes, proved each at to Sure. required producing redetermination. hedge our base XX% reserves

a twice that's year. So

at next -- look come that at outlook, reserves XXX% now the months time. producing whatever So of from you doesn't production if XX proved developed usually, our

credit more in satisfy XX% in of XX%, form be it to the -- facility than collar of So stands. do form, expected production and the to covenant in our as currently the no a hedge to we order need the could some

those more XXXX, all. if at at in hedges we choose put any to levels already we're So for for not

in obviously for we I hedged So prices. run-up think next a And year. huge think been we're adequately

more I add XXXX on real based I be now And not, any to we'll the see don't of hedging level percentage tell can't a so but right you at how if high outlook. going we we're think or

question. your for Thanks

Bank. Our from Donnes next Bertrand with question Truist

be prepared in kind XQ? hold that whether truly a wondering, half, wasn't remarks, of you kind spend maybe of drift in in back up flat. down XQ to said flattish exactly the was with in might I XXXX XQ were Or maybe you will and production going profile? just it then back and the I sure And lower the

about talked growth and kind about production, year holding think yet. I actually about really that We production basically for we're we to goals seeing that XXXX not don't flat. is talked in X% XX% the you set of have -- this

so -- And we're

that's fact, said. we what in Yes,

mean for. growth. On the plan it's operating X% production final slide. calls And to I see that's an you'll XX% our what

there that I the want of Sorry, and but I I half, though? maybe -- back just thought about yet? sort quarterly you talk you end, that guys heard say Is Or are of the just towards meant yourself to don't way, either the cadence? is ahead get activity, you some lower

to going Well, see the I levels. kind of I of the you're higher the production quarter, the that's half think, -- year third obviously, the mean, yes, second is

production higher coming see two the the second up level we'll levels next So than quarters. quarter in

-- But it pick level We're to model drop a good going XXXX. to that and We're our it's in going out off. question. to not try try to production in it

management on I think we that, too. discussions have

we've gas loaded can we think those gas, of a drop production actually at that we -- We that our big capex. and some don't But XXXX. That's then corporate we we to lot we're we're natural with are $X.XX, I I $X.XX, actually said shift dollars capex high to But can had goal not that got today natural We either. we're that complete. that. peak have what gas DUCs know is a off. high $XX.XX, expect selling around today, front-end we $XX.XX at to in record DUCS. a complete We and price. high we But -- a a monitor mean, have going Comstock,

then follow-up. my just That's really, only perfect. And

just talked the you revisit out could maybe if but have guys there, wonder that. far know want to I guys about gas taxes pretty you cash With strip. being higher before

think no, tax we of able still to we Yes, I lot attributes, good a use. are which have

cash expire. see -- our that we something that taxable for taxes we our be able goal to put use on is we several use they the And before to really being carry-forwards screen to so have And try years. to maximize radar income to to don't really really we up want next the

We of But fairly of modest have right bit structure, have that's see little we That's to income now. little a all amount a compared the cash -- a we bit due state to have. kind just of taxes.

question next with Bros. comes Tuohy from Our Noel Parks

few Just had things. a

I still surprise side, hear that play's that the had time? leases it's development, significant those and something they you were expired the With long your put just success came additional curious, can for had a that was to you at in you've the pleasant a on this eye had leasing together leasing. on just stage Were available,

a kind put When Yes. Comstock. result accretive This there, what's land of be out then see you of future. is combination floating they the the us and to of in the Covey together you groove and would

and a fruit, we And go So that's consolidated then at all in our programs okay, -- what while team call for then here those said, are together. we didn't low-hanging the until opinion. management on had we forward we

So -- leases. we when spent But go a on out and dollars the few we on quite it. we favorable it's very terms

I making. Great. were also about was you just the comments thinking And just

frac you the the contracts a as -- built-in efficiency you're sort spread, horizon far overall paying Or on you renewal have available your rates? to you stand as what to environment, or where path, now? do a As cost of on in you far as is at which negotiate there have do

in of in course, That's locked pricing year. on new -- January. into Well, preface one That's new the do We contract fleet. just part service it of probably to next goes that number. we've have the three-year Titan

kind more two So years. we'll you one Dan, the -- that three frac for And crews. of to talk that, to has in addition need -- about we then been fixed need can probably

Yes.

So that's right.

up crew it is for outlook, So think and that turbine anticipated working which that's in gas will years, a fleet all BJ for fixed we show the three It's January has we provided us. be the the going and start. current of -- about will kind X, the start natural great the got to deal

The have where doing. this fleets, have -- do cost we run a on but in -- they they there make market what typically of language the and they the other adjustments price -- they depending is contracts, through the can conventional end their year,

not down, like solid sense, will this, like our be. locked gas fleet in that natural So they're

I Got the had curious was kind management And the IP was a the you. record that that I XX you on And day million also well you company? you just a quarter. that for days. in is wondering, of stand choke these where

a obviously, our is But up not or showed. company. for ever that's record capable $XX IP for million I mean, mid, of day have I no, more. I think we the is So the million record the company in highest doing the $XX think, we've about a wells

versus a rate at more think down Choke basically, the environment, we've reported. so close hold flat basically -- rate high I in price the that's ever until they management, even us a pressure, there. highest of we get our higher then we better declining to start the front-end kind from month, -- let and basically, loads off we they'll production Month decline X. gets return a well And from that off line

Great.

Go -- sorry. So ahead.

well And do we restraints be can can Yes, as what the flow pad. choke off could do. production other tailor each management much such it you of there pressure us also how performance tells and wells around the

just because have -- only every them. can there's may optimally flow don't or always not So to you want overwhelm transportation facilities, so you much well

to manage all factors to flow rates. those have and So deciding we

from comes with question Mariani next KeyBanc. Our Leo

hoping of help here. spend a was capex could bit your with kind you little I out

second kind be of talked help third in the Should first than of noticed fourth And certainly on year. had quarter? quarters? like based the a of I of us in you kind the kind quarter just quarter. it next You completions of Can the for bit not looks plan about fair you the with half many weighted year, couple being more less very the

on the just quarter be the down us Can to kind capex trajectory a spend? of going So you is fourth with help lot.

May. of can more the the at just when rigs look running you -- were at kind levels And drilling, Sure. look we and through

we'd down because rest actually the of up. really, little quicker be overall a to a drilling through be you year we're rigs So also manage running trying there's four There's many to rig six bit, more five a have DUCs maybe is the activity rigs a build in then rigs, and how the times there. again, of going drilling just couple because the first, January months to where out May loan been probably for

So the first quarters. the completion half. three might Dan, to many weighted weighted crews the the more you in activity frac running definitely talk through about first how drilling we're activity The so, is is quarters. different

frac front-end currently prices that's that two more this crews. dropping want that We're basically should do at are crews forward potentially dropping do that year, the try the we obviously to profile at be -- load end of looking current we now, And towards to crews three we running down the pull year. got will sometimes. we're are the right at. one at frac production QX. discussions But to have in And frac end to about the right for the And what's of December. And we in we're be we three. now, one the at some of year. We So

say, fracking, we we -- the are when you want too. you Purposely, budget to shut-in set one, Yes. to when hey, have more

optimize of the with a months, just think -- what's of sticking I And kind better way. So kind right kind that. designed we we the it's usually to of now, in production still, that program

follow activity, of So the that I capex imagine of is That's helpful. described all sort you've would And as going here. okay. to

Right.

guess maybe follow-up. And a Yes. I just

where the on previous a you to that environment had about just the you since up XXXX. call X% thoughts Is type leaning you good bit talked X% more you about lot little think Do growth move or kind would a that? to about $X.XX do because approach, on have price growth bit like of drilling? little how Or would are to more how in gas guys say, the maybe a environment returns the XXXX? so earnings you you're of clearly just in first on Obviously, think growing early seen I gas than guys then, of any prices production XXXX. kind X% quarter, we've a in X% here faster materially,

we'll on the We the do plan the on keeping count, see efficiencies completion. same drilling what and and rig

Right. Yes.

us the kind I going assuming rigs of right of kind running to of a of -- production to goal yet. we're set we into and these five type that free with XXXX again, have talked can growth obviously, think And lock you cash we're well, that about program flow. early it's But achieve the to for now, kind program. for

lot to look continue we'll we So, at where are. that. will depend But a on

leverage As and before we'll we here. in being up next But it achieve the see for we definitely spending the year, under to decisions other down we goal we our in start that to open leverage want really coming been years, fast down, have XX, advance. several opportunities get

All right.

targets right. So really in designed just to just kind is sort -- production an the cash and lot a leverage output upon be kind that flow budget then free of of will of maximizing of

a like The be get be have the absolute the but getting factor, there -- we to want will year. to -- won't profile. to next production the absolute driver the maximizes we tools all will what -- it We be get leverage think

And so they're right here.

They're to now. goal. bonds. like That gone a So was check get those box, coupon wanted we of rid we just expensive want to that

focus obviously, So balance to leverage. leverage. debt now overall it's growth of And -- we're is with debt levels the going on reduction and act balancing EBITDAX the

lot We in save money XXXX interest per expense mcfe. a want of on to

more look in get loan efficient laterals. we'll XXXX solid. Prices with think I

Those rig our down a our we good a with same balance the count. we of it along just price, sheet, area. really story. It's it corrects pays Tier higher course, it's efficiencies. simple have again, fortifies So our X efficiencies, RBL, growth because and have debt, It's

to session. like for over closing concludes Jay turn any would Thank you, now this and I to back the call question-and-answer Allison the remarks.

that. some but of we're advertise now, load middle do prices. Again, gas that we're corporate about high about quarter, kind you of as because time We production excited at speak record front-end a Comstock, natural gas selling months that of right remaining capex. six we right. again, we have, All get the to at excited and this more joined of We year. the high call. it's our good have the And We today, natural are that

department, you good got operations thankful have want all I good that and this used know up that are models recommitted We've we So strong, balance that to a backers. we're clean to of sheet. we've

you. So, thank

today's call. Thank participating. This you concludes conference for

now may disconnect. You