Range Resources (RRC) 22 Feb 242023 Q4 Earnings call transcript

Welcome to the Range Resources Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions] Statements made during this conference call that are not historical facts are forward-looking statements. Such statements are subject to risks and uncertainties, which could cause actual results to differ materially from those in the forward-looking statements. After the speakers' remarks, there will be a question-and-answer period. At this time, I would like to turn the call over to Mr. Laith Sando, Vice President, Investor Relations at Range Resources. sir. ahead, go Please

Scucchi, Good updated XXXX and call certain on morning. Earnings Degner, on the We and are operator. a website. you've joining to our presentation chance today's you on that Range's slides this Dennis review Mark Officer; Executive year-end Call. release Chief reference Financial morning, you, the Officer. Hopefully, thank had and everyone, press for call Chief investor Thank may The posted speakers we've

on website Please the non-GAAP under XX-K be tab, our you can using today's Investors certain find it or SEC's also You'll call. Range's measures on referencing note, the access system. EDGAR we'll

include provides also that, by to product, realized comparable reconciliations release EBITDAX, Dennis. to these along GAAP with press calculations posted the margins measures. With on figures. We've tables call non-GAAP of and other most the over that pricing Our supplemental cash let details of website turn me our

to showcase XXth of great points performance of of reserves update of long-term resilience point a call Thanks, advancement of improvements. balancing Laith, free capital XXXX debt our safely prudent fourth cash consecutive to the you of year-end and successfully example inventory. all our driving our plan a year. repeatable of objectives Marcellus the and year positive with are a flow, joining flow that development and thanks our free results efficiency continued and the allocation with returns operational consistent those world-class cycle. Likewise, with asset continued cash the of theme believe base. and nature today. and Range's to capital shareholders while revisions of was quarter Operating throughout reduction I a low Range's against Generating executed a peer-leading business the key for further

for key believe environment look clearly price resilience in be beneficial fixed in we today. And and cover like is a lower of the hear program in hedge ourselves our price a themes a you will year flexible periods business Range. Maintaining that will to find ahead, As differentiator I costs those the commitments we towards has weakness capital repeated.

proposition over by capital underpinned is sustaining requirements. value the long real ranges the However, run low

of intensity shallow drilling decline, result Range's large class-leading Our any our blocky base rate liquids is of to a peers, returns durability low solid generating lower for in and volume. reinvestment free Range's shareholders. Further is Range which provides total foundation costs, than Altogether, talented these contribution, production consistently our completion significant core flow cash and the is bolstering of inventory XX% that which our capital a approximately required and is results team.

gas Our provide an and liquids to natural very revenue strip expected to pricing, today's prices uplift it's is using meaningful.

and barrel That to Range's strip per recent that all currently premium equivalent together, of our XXXX liquids is free capital most to Hub a Henry barrel breakeven our as XXXX gas cash NGL projections. Mcf For for is priced revenue $XX lowest program, the context, per using XXXX. the When uplift, prices flow, around evidenced hedging pricing. $X.XX results our maintenance and producers roll we you get natural resilient and thoughtful among by organic low

for with the have our in we compound high-quality per Importantly, of vast to cash free share Marcellus inventory our ability derisked flow growth to wells, decades come.

plans. to near-term Turning our

spending few the flow along support plan, This to million For past of approximately healthy capital with similar between million. at million consists strip free three cash base level plan XXXX, Range $XXX additional to expects investments years, in capital to with and pricing maintenance categories. $XXX generate our all-in production $XXX

of relatively but our our allows sales. being only feet inventory XX core actually most acreage levels, additional maintenance is for Keeping of offsets million turned spending Marcellus above laterals, First footage not lateral which longer unchanged. to

as provides like payback And which had Second us completion very the capital, following and which D&C is years. The and is the for lateral LOE a of our evaluate retaining XXXX year, lastly, overall frac an and low supports rigs future. last and/or optimum drilled completed a inventory drilling flexibility quick same a providing investment we efficiencies footage, and with as additional be drilling in optionality operational flexible our XXXX, infrastructure, in in water of and the and the number cost for year-end beyond. increases will expanding flexibility generated the which setup inventory as we and of provides simply crews equipment, result maintains

acreage similar backdrop, footage to of macro that the years, per X.XX turn year to sales equivalent planning day. Bcf Given is at Range Approximately to production will is X.XX recent that X/X lateral profile maintenance a this located the gas across program uplift super-rich realizations, our and positions, dry our NGL be the price the of benefit remainder flow footprint. wet to and our providing focused our overall added with cash on of will

as our repeatable in than the the the on pads being the a production completions the front Range year the many be half operational wells with program, approximately production with fleet to for from year, production turning approximately efficiency. and more new executed prior years of to weighted is resulting of back drilled footage year, operational consist more new feet total maintenance rigs a a drilling wells what lateral XX drilled, XXXX Our XXX,XXX utilizing fracturing Similar supports been Returning story to half turn go XXXX. horizontal and cadence lines existing in capital developed materialize our activity XXX,XXX well. Consistent XXX,XXX with will pads for in throughout existing the production. part our we back will the half and single of new electric as expected XXXX will be years, sales. XXXX. be profile capital of being or expected feet new weighted operating about has combined to feet of two both to will into lateral than the while operating With is quarterly production towards through half of

equivalent to the Bcf into X.X expected First per around quarter building before half day production second the year. of is be

saw top review than our while with extending drilling longest of laterals team of drill footage lateral operational history combined Range's theme had XX,XXX laterals a for in highlights. XXX,XXX year miles. X a That efficiency to drilling with showcased total program X wells XX excellence. of longest starts the greater the set execution feet. the laterally. XXXX the program managed several XX% with the lateral Our records nearly the new exceeding for past The length continued X XX,XXX X feet feet of

access a while single allowing us these infrastructure reducing requirements. overall drill the footprint Our location, reserves to large and of increasing us long more our affords from all to acreage type laterals, ability contiguous efficiencies position consolidating and

drilling in longer equally team day fastest and zone. new set the pinpoint of the a are rates to The a footage. for the daily year, drilling laterals step X,XXX horizontal feet faster exceeding addition important the increase drill lateral the more its previous drilled period. in gains footage daily new X,XXX managed simultaneously program's change rates In see in drilled The from XX-hour was key per when daily record efficiency team, we set average by than XX% XXXX we But with success. day, link accuracy benchmark improve also that to the feet was over to

with long of positive standard years, our by drilled achievement the the for and had, extremely team. investors come their the less with lateral of the year. success revisions A the performance geoscience type teams reserve for more have within noteworthy in staying plays consistent from feet. In footage Range. rate tolerance targets high the high-graded XXXX, reporting XX in it drilling horizontal Over they to than have expect laser and a focus XX% targeting, than all role of drilling This and the our did set precise team lateral typically an while that a

Moving to pad well mark the a completed longest to could been prior in established Range's completions. highest a execute these incremental just our records And stage. completion improvement XXXX, depth role include measured average are stages set over setting water in which a X day, XX and a the XX,XXX have operational of logistics Range These and per accomplished a without the supporting completing to each to reliable of can't quarter. efficiency overall efforts. But period. gains the year new Successfully XX.X logistics new per date during team following: we XX% results with fourth a in the stages in Several of operations stages set supporting total day, efficiencies critical mark, was achieving operational not safely. record increasing these feet if were XX-hour played incomplete during efficiency

our look best In of shared addition safety to the one on the We months these forward results on upcoming ahead. team in in the corporate sharing the and also company's more delivered today, our environmental sustainability report to performances in highlights history.

marketing. to quickly Turning

price a to program NGL This the quarterly This $XX.XX During $X.XX average quarter, Belvieu premium the and the Mont was highest index performance per weighted history. barrel. in per company was premium Range's barrel Range's is company export basis. a during driven annual year was best flexible by and and quarter. $X.XX saw an strong NGL per barrel values XXXX the seasonal LPG Full also butane premium on

pushing advantaged, And towards $X would flexible barrel of transportation to we the premium were remarks, the to above remain guidance. to XXXX to Coast us capacity NGL XXXX, our Range's I side half in in $X Coast Range Belvieu durable our dynamics currently maintain our supporting tight flow and be of index for these that the at gas as of priced to premium well options. To the extent as natural profile. expect our expect by the prices, minus a mentioned cash free of the Gulf beginning access leveraging We differential East export export the they is second

along industry, with on this rebalance by incredibly in the industry continued potential power later should being This and these in the Haynesville Turning activity, a along U.S. help We're in planned gas Tier expect X the are keep maintenance and reduced Marcellus. price XXXX activity prices industry market of natural with in half levels generation gas. programs the moderated and project encouraged to Near-term for the challenging LNG lid the year. domestic the obviously we historically start-ups production low natural provides strength second gas for expected basins, to across

outlook for for with domestic power up Tier a and this in growth long-term gas, fundamentals. U.S. set demand combined natural all strong exhaustion demand, global industrial beyond inventory well gas X While U.S. continued and year,

the generating across XXXX over well show previously. is and while and financials. to focus turn build Before remains repeatable focused strong, the on performance a positive Range results efficiencies in message discuss natural delivering XXXX, it of and contiguous advancing reiterate inventory. now large the to We our team in Mark, flow and of handing overall and of future shared believe we've believe resilience generated the cash gas our free NGLs plan upon business. I'll that reflection to Mark are we I the over a to Range's I'll

Thanks, Dennis. weaknesses highlighted sector. the the companies the and of strengths XXXX in energy

of full producers, to create Range and and the set with only of reinvested in diverse team, and reduce company sheet quality low flexibility each these to strong price all ability the rock-solid balance attributes costs, to a company necessary upstream the flow, execution through For but reach a bought with cycle were provide points, debt, of by variety pay operations to assets customers cash future. not the value. has maintenance, a the shares sound free for dividends, prudently key position for generated back

and the here business to maintain we and natural production, efficient gas demand natural liquids. plan As for we international early XXXX, gas positioning domestic also in are with steady evolving sit carefully an for

will As reliable generates a a materializes, incremental positioned from be to that business. resilient energy long-term Range returns supplier be demand strong

This the balance paired billion of with in allowed before investments funded per Cash greater million Let's allocation XX% attributable drove million flow reduction dividends resilient costs a approximately advantageous that fact in of prudent $XXX roughly strong of that portfolio start an comfortably unit. than of from $XX a with margin our in realized cash while net further in demonstrates cash margins returns the a the investments in share to $XXX price unit competitive XXXX. the and price repurchases. commodity range diverse $X.X capital debt equating working and maintained capital on cash and sales commodity business cash production capital to This strengthening flow sheet. with setting, base the along low million, business of mix of allocation back

and stakeholders. share in returned past the to debt is dividends total, $X.X of Range shareholders X years, repurchases in the billion billion an returned reduced $XXX net has by totaling and to million. Over $X.X In aggregate capital more form capital than that

share wells the safety reduced delivered of count, shape completion rate With team in for out break per competitive efficiency resilient With costs, even reinvestment balance which of and results continued was on cost the tireless value capital at flow a strong cycle team included required Range's a rate the planned perhaps inventory. companies, the few building focused and and maintain cost efficiency. great is production lowest in XXXX operating sheet goal. Driving comparable and The Mcfe, stands to a decline terms generation capital drilling cash of full production. the financial

As a CapEx. percentage Range the cash cash on for lowest near flow, regularly be should sustaining of call

asset this expect for base We years. this be to true many of

fourth from Cash price fourth lower the achieved results a per $XXX for on quarter result of per working lower of of quarter expenses margins driven was cash quarter and of per a $X.XX, Operating unit year, were interest production lower $X.XX $X.XX despite to Focusing capital reduction benefited before last lower commodity Mcfe. realized margin million. moment. GP&T expense. costs flow with in Margin Fourth flow compared a by healthy XX% unit an prices. primarily unit cash

These As and way expense transportation risk we cost decreased reducing linked with relationship during had and serve totaling a In taxes NGL coming NOLs for $X.X of XXXX, fuel as gas topic cash were become is level reduce carryforwards relevant $X.X mentioned, year. electricity to a QX processing the XXXX, state will at company are a have quarter fourth Range and roughly gathering, between billion. prices often costs. Taxes in taxable the NOL serving Also Range's year-end, income to costs profitability. that million in At federal right such costs pricing. processing years. the lower Range's only total for

to layer first can can billion federal benefit approximately profitability, the NOLs we understanding, believe to a years. given $X.X taxable remaining full The up used XX% At will income. coming pricing strip year's carryforwards income. of of to reduce $XXX to NOL reduce we of current million totaling federal taxable added be some XXX% NOLs in of For the used utilization approximate these of Range's expected and from up be

the Turning is from where XXXX in to XXXX. headed company accomplishments

base dynamics by Range's in results Maximize cash all we around and With to assets to participate strategic we flow, in has near-term reinvest of capital allocation. capital efficient Given thoughtfully consistent. for operations, the the while consistent, financial and a to strong forecasted that confidence the provided project seek we hedged of providing consistently approximately to and well XXXX XX% the an with an stable do of has Appalachia, continue portfolio market Plan is approximately be the $X.XX, of asset floor hedged a all and gas across natural company transport Business high-quality a will paired in to by floor delivering financial continues flow future. Presently, what underpinned foundation. average with the through in executed so program, preserving and in Range's foundation believe generate value cash low improved balance market free support increasing price and flow, free successful intend average hedging largest range long-term the on production focus believe business. constructed a a Range sheet leverage, to the Into a XX% return price internationally, philosophy XXXX, sales inventory, demonstrate optionality creating high-quality cash We with served additional cycles. Range's $X.XX. strong multi-decade generate remain prudently hedging U.S.

price and to business the and team, have cycles, succeed value investors. Dennis, and assets will continue the you. balance significant range to deliver to sheet through believe can of to We we back

Mark. Thanks,

of Range's never business that and a up XXXX to industry, like let's been progress operational flow a like stated be the safety decades their generating for moving a derisked and improvements our inventory dedication but discussed stronger, has cycles. With going towards year capable types free these for for performance, to accomplishments challenging questions. into our looks through to line having high-quality of open cash translated in Before their it's to financial I'd continued our that, the measured congratulate and objectives. business team Q&A, today

Instructions] with going is America. Leggate to line Bank from [Operator the Doug of first question come Our of

that recognized a is stock. that in your I off, question I if do But more our comments. asset obviously, in every in all thanks And at to spelled macro a your book Dan, have out quarter tremendous for least certainly spades may. yet base you've kick not

making gas the and obviously one what prices to produce. when price the to timing in indeed happened your couple You've in of last some seen about the of in own peers your days large to of share sector decisions response

So I'm about perhaps better X thinking timing gas with completions curtail the into just can't you exactly drop curious you crew, on frac markets. of but that your activity could Obviously, a topic.

I'm that? walk us through could you about just if think curious how So you

question think we've a the past we've several way up. but lot the And our I word the is remarks conversation we the to given in used something you've weeks. thought a of asked program sets We flexibility lot this like like today, that and over the flexibility. prepared that know of that I

have in our it, while say know the the a If NGLs economics. curve cost our -- this we look ] you of we've wells for just it. basically you with look that shape let's field, our look commensurate associated wet will we've when back at side shut-in take clearly, line curtailment the years, of gas been [ have And dry When where uplift looked times at in realization along could at there year. turn that when supporting to goes and place price reduction portions gas ability really to past chosen the of and with several our

of is like. With looking the XXXX, the that does to virtually build are basically flexibility out, as what have us makes would gas, get baked in of a see look kind ability with gas change telling We and going and remain our in year. the the shape and fundamentals bit. we target the we've inventory that adjust given quite our business. support basin sensitive absolutely that we forward lines the program based will basin we'll our out flow of to to But off business and for timing flexibility upon for us setup turn the transport it for that the So we those NGLs flexibility the the and this macro our the what the like XX% calculus XXX% of for on lines what our cash throw will sense very

look in gas frankly, easy on going the mind, of country. efficient wave, in I navigate. see that. good for I a for obviously now? pin to appreciate in mean you've And way assets tricky My to if high-level I see credit ] helping any, it's also great how kind to team the your know curious if got curious of you [ quarter easy management question Putting The Laith that in are capital one pretty But in the and on follow-up but is the a to hands role think you're like. is consolidation It's the a question. about not. that, very most on us execute. productivity sector what's it, that? already operations and -- the just with be continues producer right I'm you My you create predictable the to and great. the others to how value us is

M&A, they've Upper we've large also harvested M&A keep path is even way talking objectives to as there's you lot a from what view look haven't about doubt Marcellus we But at the even has we able the think Range the at of that the basin. we Whatever look think staying an no stay could that has remain course. When will, a that inventory the know past. standpoint on us we and to a the accomplish, like our be of been the we at looked the the And the to replicated, in parts Range. put place, in inventory isn't has opportunities quarter the again, like. different the And it lot We I know that than focused today other embrace better or Well, some we would in-basin capital company it look have. on somewhat of Range make -- quarter about has and of -- team been kind the that, if something we efficiency we after successes we've whole to make you the that Utica Devonian. talked even below the in with look it

we question. not capital is certainly doing year at there leveraging in about have ways, of times, and a and that after gathering lot say, other to is to services, and structure. it's this an scale be processing transport decade efficiency. But an of and take year look it cost type like feel a decade benefits just after necessarily whether and So some today, number we're which what enhanced something we've a size cost replicate we And been M&A positive let's possibility asked further, combining could of common it's and of can

opportunities. those look with we're our are there out, that a where like see or Doug, go look have to we we as would metrics, Range -- pointed the you of it But when way. at other lot So some you

Mark on like on. today the and we're to the and kind inventory, that feel touched team So where path got the as we both like keep at. forging I we've We we're of

comes of Nitin from Our next Kumar line Mizuho with question Securities. the

years, want start your debt flow. your about remarks, I prepared primary talked Mark, your but off, source to favored for free you of last to in deploying a reduction the returning couple shareholders, as cash cash

where year that at should -- for could your targets the a more return directly? range of some cash within how about debt, a think we cash returns forward? is going you're year we shareholders see Is the XXXX least this Now for

of way responses us the and north Dennis a resilience business debt. a of a of reposition couple to of trying his highlighted in I it have in the this build off come and in think it and couple paid as We've the and morning, in sheet. comments $X.X long our we're last having Range of has over years, balance are of hallmarks flexibility couple the built both billion how

return the of out have approach. fast of one flexibility, a hard than laid program again, the capital is, So key in optionality principles rather we that and

programs. the the last debt years day, larger At share You've of seen the of down, And couple prices us end reduction. as I mentioned holders the in my a the of opening shifting value in equity equity is enterprise you that debt comments, to reduction over come still return as the favored holders. think about tilt as to we value favor repurchase and

So sheet with the end that where at range. the target headed I'm is our balance of is high basically

where We it, have we'll flexibility. positioned over we directionally years, to have continue the added we balance want sheet so and but the do

for flow. starting program cash XXXX our is the So generates free point

a So and latitude have those decisions. the share in repurchases, be certainly we intrinsic those lean dividend modest to and a have program see versus us between though we share more do in We to given and sense value weighted make repurchases. optionality, the as the share disconnect opportunistic in we'll We favor base heavily underlying makes right asset dividend-type well. now, price

answer long-winded but question, to we So remain opportunistic. will your

major for look reason, we leaning If in closely think a disconnect, I you a some harder. major certainly saw very at would pullback

respond to those to where to So flow we cash sheet free positive make market optionality be and have decisions a have the that conditions. able and it's in program balance to good are

bit targets. of about a kind Can end of also XXXX talk volumes. XX% guess maybe having floor, so your I second north your attractive little about you my about Very now around at question but for financial, $X. leverage of you high of the hedged Great. that are you is Mark, talked

going volumes? is whatever is? do certainly a a because cost You we your XX%, Range is it position? less we Or from see Is about a much -- stronger should low sheet of that or XX% How have structure. Or forward? hedging it hedging formulaic think in balance

more we're achieve. costs there's your to cover of philosophical a as takes capital your fixed trying objective it like what So to starting point, We to program. a considering

so to varies forth. available you that what by varies price So obviously and is by year,

fixed a can floor example And good XX% structure. is for That of be hedge an So XXXX XXXX covers cost essentially $X.XX gas, cost pretty and example. forward. that our of of that element that natural going about

coded much to achieve to strategy. takes So not mitigation risk philosophical percentage. so hard that that it's what It's it

Bertrand next come line question going from our to of with Donnes And the is Truist.

previous lower your year which a the In slightly Just if end your of up year. that's remarks, XQ for expect to what sets want into level, full pretty to clarify you we good prepared range you answer. in a I production want ramp mentioned the the understand using just should prices drop-off in maybe using similar Or to the gas based of that peak. a on wells envision that the you again in with time? XQ just kind just 'XX, do seasonal the for going process wells is in level decision at where Or progress are out the purely forward?

XXXX. half maintenance similar in to production to then front it to of the And look capital half way we is in year. very our the in you gets program profile expect shaped, does I very have of back think you think When XXXX, about turn-in to come the 'XX. would activity see I the similar those and lines the way fruition more year, XXXX think -- Yes, about the to the

base should 'XX similar XXXX we're a production about So maintenance way look think a I the that. lot to scenario. with starts the planning type way today the is look, think program we And --

year inventory to of XXXX, into it inventory 'XX. the that in turn and translate the opportunity in present so in-process that in similar through we And year be prior cycles, into toward have what back our built the the in that to of would that clearly, conversations some some just midpoint lines but more of is, half that the would complete up early wells would

higher full makes That the does set And a greater average year then then the XQ? in if there full XX% in XQ percentage? I is a cut any on that then higher that. next sure one guide on was it the you parts outlined than guide. year lower in wasn't And moving up your and sense. for Is just liquids second maybe

Yes.

be I a the of expect quarter-over-quarter. think of conveyed. year we've side. -- similar the to percentage because it should of expect a a part should wouldn't which is will lot And be what liquids from of I in variance and on variable you liquids-rich production this activity weight there really lot our

don't the will year. of lot program I just the we to through balance So overcorrect. say the tend a

again, So see be through our what see quarters. say, you'll consistent turn-in-line with type we've reported profile, weighted liquids half is, in very back you'll what I'll prior just contribution that

is with question going next Diamond Citi. our And Paul come to line of from the

question on quick guidance. a Just

talked about around million you water infrastructure expenses. $XX other guys million some kind You $XX of operational deploy and to

you Just how an that over be get and being summer-weighted? how to or deployed? just more about that you'd wanted deployed? it's to consistent you directionality time see of them when idea expect think guys kind Whether the see Or that to of of being

invested and decade can got we X,XXX the to imagine infrastructure point. place water balance infrastructure build-out. this a think scheme at we've capital water that from projects continue talking things. I we've on way deployed the of would evenly Paul, get completed a further be to will producing further in of year. small But we It where our about how good drilled be really grander a to little and and allows that moved core the the the of going wells, get that really us, majority through think fairly small We're you now to as capital this over is ago about in

balance second as to this through year, that we're the be half to year. we'll start of utilize so half it of able the the building in or back the And out

spend component So year. to across really evenly through or the more I would expenditure that expect of spread fairly bucket that be

based just and quick of are do economics on pricing a some just the in those about is guys' the on progress. just Is to you How something of fundamental ground? a you kind inventory that being envision And the eventual deployment philosophy time? surrounding of your follow-up or level XXX,XXX anticipate you excess? holding thinking Or wells touching guys on feet it that Understood. those purely over how

the thought. macro do in-process one It and we that of I'll back back that gets -- signals the of how think is What would from macro? to seeing fundamentals, -- what's basin suggest what Paul, the are Yes, international the this the really we inventory. I to market we go kind fundamental utilize

reports. that to word allows upon So program be it for you're mode through a It having we from we will I the as allow in we've looks inventory that the setup us like flexibility, pointing that, could like blowdown using I do keep utilize about without either be believe start think but some us. think to in more efficient or XXXX know XXXX out, head pricing us capital depending getting right we that's even other seen maybe a to maybe what

And is to of our next question going with from line the Co. TPH & Jacob Roberts come

some were the if to inventory progress even -- a to terms hoping provide spud you in to wells where able sits were -- timeline? in We commentary a as to percentages or waiting of turn-in-line

the repeat you for one Could me? time more question

frame you deferred in I'll there? Sure. if mix inventory, try simplify progress are the turn-in-lines the these XXXX, the of wells or it. end can to in at DUCs just Perhaps

Okay. Thanks, Jake.

that. It my about was a end. to little hard hear on Sorry

the good mix. at thinking -- about way inventory will bit be that as of think of it year-end, I a a we a

So lean as you can -- program. retaining we've really a got imagine, by

ready of are some or not completed, crew. is frac rigs for that those with having inventory they'll of year, a which basically by spend the to going the for horizontal the through we two their dedicated level wells our program would one so it that that the year. In type balance that retaining maintain getting of to right we've the completion XXXX, efficiencies this generated, good gets gates out some of start of horizontal for but we're need be keeping And outlined, maintenance

drill of activity about kind it's it two where as think And that program a out. low-level base in of day level enough we've as our generating frac talked efficiencies side. rigs are improvement remarks, footage that a through about for and per XX% crew prepared really you last on daily day in So course, on of function stages the of drilling the and then, really the improvement day frac XX% year

think of all to wells somewhere basis, equivalent But that. there's XX be be, of let's going a we'll just be there year, in some complete fracs an between that total kind So have on X basically that but byproduct into to in carried year. this it's will composite, aggregate we'll will extra next

spend. is on incremental My land the second Great. question

a feet feet feet these base to XXX,XXX replacing lateral curious long And like replacement continue how be of against about We're versus lateral of of comments spending in aggressive what rate case? lateral is the drilled dollars. every XXX,XXX that years, kind year Your runway what the will sort subsequent inventory. Range very then looks perhaps the

view. period put think think for you and of a you up second, kind an back as feet. we a feet. would the year spend, about time way and just average plan kind and about 'XX got half in the is at if at Well, communicating But look XXXX under the it it Jake, activity, of were there time I the end the by view we was ago, of land at a framework opportunistic the that lateral I'll turn-in-lines think of XX,XXX and year had we this from we to XX,XXX we When the average a an that you length look drilling

leasing So that by through laterals, on. of extending laterals, report opportunistic, some those numbers it nature capital-efficient the some that call the we'll we did provide what we through Open resulted some year that by most in the wells extend year of deployed Track of our to we in

we field. it lot this can our way lot of a do we as portions also of think well. also of we a So where HBP of it But that's have this a in framing year-over-year that's secured is

do field next say haven't the there's line And us. years whether or future of the other it's state few sight leasing see we also of could on, to also for heart expanded to So fully that for opportunities this. of within parks provide opportunities we'll some continue just the the that we areas

here see we runway a yet. So decent

Scialla question And the going with from of come our is Michael Stephens. line to next

the to really level. you capital you're those above is this some Are things of the maintenance ask your rather? spend question was but obviously things or why the compelling future, force Just main guess where it's spend but in trimming now, competitors these the about gas other some to year, and are to today dollars they wanted budgets, prices decision with on the looking looking for at I -- of

saying, kind low of example, a capital the water the infrastructure, as I by is think kind our very investment story been of that had we've I'd efficiency. low, Michael, significant an it's start supports I'll water a piece look, our of this infrastructure just ongoing into but say,

in honestly, really for like pads as we future additional we for with think us of So again, continue back existing infrastructure, as supports, invest the time barrel low supports to for dollar or infrastructure the from this other that water again, per expanding quite recycling to -- our it key felt basis. to it's right hold could if is cost what low-cost location, -- about which producers, activity, to that move type per dollar foot will. And component doorstep water you on a

rigs some I delivered look, our time utilizing this the see these at not like that deliver our lease We one kind to then efficiencies, land two it feels in We've that's to changes overall crew is wells we've and It make keep up crews, the continue we've drilling the of alone moving couldn't we we'll you partners be to service some allowing activity service think our to talked one XXXX. But with most can in some to the happier the that really those wells. The decisions that's we rig January. these capital-efficient got a of make And pick end maintain rigs. about that the past that frac not think relationships say for as and And but to with picking got to as up ability rigs busy. we existing we've been it's laterals highlighted best just will three perspective, bucket, additional the the trying of upon right with other part just crew. down year direction other which setup enough, us They've both going partners. of management, this also just base extend of what It's momentum from XXXX. this bit, year. but team. think I and X a based the is drilling about to frac one supply little

could part of be XXXX, and probably investments some lot future very time again. But at would So of in about also we've ways, upon the the lower this moment you I investments we're now, guess is and see lean time depending program, versus at we making cost years. could think reinforced now a what I this XXXX other in how be this think that when something a the look you

really program, a scheme in And to so it's story. I'll These are it grander low good hand and sets nice of we we feel think of quick. the over up it window. like overall real dollars the value a the Mark

Sure.

I drivers. think, key and highlighted Dennis, just operational reasons obviously the

back point an out appropriate view of is now to So do it. to financial just zooming time the

I think question to answer is the simple yes. the

we bolster the is, our sheet, achieving and at the the in objectives capital fund and investors flow, you the to invest return program maintenance program If what company. look strengthen free balance core to generate prudently cash

check we think each of comfortably. quite I those boxes

year, There's leading. on D&C a peer look reinvestment Page program, if our slide deck of that. So X to the for for rate at you our highlight it's activity into maintenance a

Range you is and in hold [ flat. over call for If XX% XX% of reinvestment look than it, capital is the call price the last depending XX% cash the to to program, years, at on couple maintenance to production XXX% Industry of flow greater ] their environment. prevailing on

demand be is when very in investments. as and appropriate costs for Range, this in opportunity they again, coming materialize think we point, Dennis's build, could grow, years are advance can what of modest eventually an we does So

maintain more investments we generated the why inventory? the of friendly small so it? option Do build inventory a inventory works Do expect. a I Range of of flexibility flexibility for but cash have we and some do we'll that subdued? have efficient we and do the for and fine are of remain wells last very we operationally to of fully if, and using flow some that the in year, modest make earlier creates Or Just-in-time XXXX? something That's story that reason, perspective most the and resilience XXXX the again we prices you repeat can that time, if from of said cost

a and detail lot I appreciate all of sense, the That makes that. on

requirements had you feet You over little you further. over things guess as these see XX,XXX for at I or there, I the and the term? heard mentioned, Dennis, do lateral, have XX,XXX pushing does you laterals longer any longer laterals? that, And -- any does further any a infrastructure that these keep do producing infrastructure you create are you longer issues

operational haven't of surface production. Production issues on just actually complete But over to we've design these ability Yes, the also. the a design done, to is what course at them -- I'll no the facilities wells, haven't we good the we've trying our of -- some say performance from front of wells for repeat out repeatable seen Michael, the time. upgraded

so. cost structure as keep low So fully the infrastructure by doing we we basically as and our keep possible utilized,

to for we do So have quite continue while. to ability this a the

So time. it's pretty encouraging up the we've the way set

that keeps design peak gates in it's we're of from money inefficiently the trying out the facility think, whether that within on limitations follow, too the performance going knowing that to be that by spending, basically So to months well us I of much reach the basically equipment.

Leo of the comes next from Mariani line ROTH Our with question MKM.

appreciate to just on a some of the numbers the on wanted taxes. hit I the here. detail of couple I

maybe community. always guys me in on that's your think bit of taxes here. you XX% XXXX? just little to a shield Did that analyst expecting for around maybe Federal helpful kind hear cash But the dumb level I the I down that are on for

be going think defer to We'll taxes. I that. you're XXXX, than In better

up annual then taxable there's income. federal you pretax offset for layer to income. of And of the that lets XX% that layer to XXX% $XXX deductions the call you NOL, year. first your allows offset of the million And have still The you next

you expect probably the at and for reduce your effective before into of XX% uptick. XXXX, on taxes as any deferring quite that to or through income, couple to you couple to next might in NOLs, taxes So And event, we into 'XX shielding layer where 'XX I sort level, probably years, start rate you move were tax XXXX. of where taxes. the material see federal work second to would looks a you The at years would years of slowly, you're still minimal any dramatically of in more of several similar have

production you nice saying you And then prior to appreciate quarter bit that wanted number, giving versus I on kind quarter. sure. what it to first were capital That's of hear Okay. about the follow down on little guys I for production. just sounds a of up in X% like candence it's

you you or just And say the front-end some weighted. little not looking maybe deferring are the more then in sure side, weaker here. You gas and perhaps prices I'm it's here that's factor turn it at did maintenance. mention that if the was CapEx potentially some a a with in on just fewer first did quarter lines a turn-in-lines

half? So CapEx any sense It help and Just trying the the little XX% near the here on production in first of in get that? the the a be to cadence like on term. should

we to to last year. what is profile our consistent going think delivered a and, say, feel So actually very I about I'll think way to production a normal good it's

the last profile So where see you bit consistent. little point character move year, it low might be QX was think, of very you if a that to quarter-over-quarter, instead our more, But I looking going like QX. is look more is

we through the to clearly going start QX into consistent us. years. 'XX be will walk will to 'XX. the as last But couple we've of the profile get it of delivered with that usual real of as kind winter for It look and ready business QX And the so that lines, profile of you're to start to X we're see and QX itself in the production kind through peak having again, turn-in manifest crew, with QX, then our churning as frac

some guys capital, but Okay. capital. I it No, a that's on weighted weighted you maybe helpful. about significantly front-end because extra comment little might year the is late know in that And then or happen the which talking any bit of just it's I just know are front-end -- this year?

service service would a moved to have again costs really expect basis, on look similar year. little. down to Yes, capital All last in quarter-over-quarter all, the real I a

to would as look expect look just reporting I'll from that in single-digit you similar. say, you capital low should year, mid- But front. So relief to quarter-over-quarter pretty 'XX the see, our through

of the end We are today's conference. nearing

go will with line Noel the Parks to We Tuohy Brothers. of

Just of had couple a things.

touching I of on after everybody with back you service -- unusual cycle were wonder And the cost coming of COVID. was pretty -- You inflation online last this if was just cycle now. kind

you operators headed you where in rig Are rig levels? slowing we so you just I have service to, or have are we any Do just where thoughts be any have activity. their on Do of sense activity, And say, the -- wondered XXXX of frac about and some cost back think we kind that? headed might cycle? talking

different let's commodity past, start do in I service you've we're say, the think I a and its think environment really than it's that saying And probably that down. tough in I I have early. I with what math the you commodity would Noel, frame calculus heard at of prices And to think service costs have off think up, kind could up, service down, little prices cost this costs this as me say could this point the look traditionally come and past like. where feel cycles up. do look that

seen the we've high that that fleet that I in imagine, utilize of a and fracturing services. But example, balance think those. through And we've consumables relief XXXX, electric had and be utilization. on some as areas those tubular fleets will would already other the or as it an blend we've I we of in where are seen side, think you the at like of some maybe goods very

unique if So you demand, will. created certainly its it's

across So drilling kind rigs, all configuration. we've We're to basins. laterals all a drilling long multiple rig coalesced super-spec similar of

mix even months. I potentially it's to with rigs the would but next some And that's out other there will out of come got certainly in of that of X X reporting provided recent to could based be some expect out drop there, mix potentially play the upon rigs though so relief the the some to some

at a see more some took midyear did as came trend, while probably and point than QX. it we for it us it relief, year at think last a in to I the look

just history So that some think as because overall the probably know take early and cost know our now partners where that the with still cost, we'll strong look to basically together, really reduce could providers other to our relief, we and we per values I look that you capital it's efficiency we've because in service our opportunities it reported foot at see and way. our time, go and of past can point at but numbers some service work the in relationships will

last we having don't as effect the there's other -- me. it was know about price headed weather big And commodity I by and trains seems it. a And of we collide, to of years weak demand think the to ramp-up winter speeding seems is heavily we're on [ just kind still the I have I having pretty it getting or see seems of really each focused heating if at this and up have it's impacted kind the say, of the everyone before. as traditional a just ] year. And in thinking at and where innings But we seasonality have next It weak to the uptick, Do are we movie coming. kind a with strip environment. years you yet far to season winter LNG of Got with in know destock going point, much that capacity. we Because weather seen some to step the some be you demand that things just last of point, like the demand? in its have like couple so should

would be any thoughts here So that great. on

pretty the pointing think Yes, I something question. worth as And of in Slide a good you is we It's we can talk think, out. have imagine, highlighted on about, something basically frequently we here XX, shop. kind

the through think -- Mexico I at and look industrial, now you going at online to about res/com, think you when you that's start XXXX, really look to demand coming LNG exports resilient. balance between remain to of be when

the and that the start at bit burn sources. all what underperformance other times some to power to we an of repeatability on alternative start in year, little of that saw of underappreciated power in see my you story plus You mind, factor as a last by of

there. you've when in, and all XXX significant get start that you we So by to stand that demand of today, XXXX overall really of Bcf a got we to XXX there's to delta factor see Bcf, where

as a so you a infrastructure this, LNG is going is consider the to think And going to LNG to growth to key factor the play role not play but on to in part demand forward. go is need be really start to We this. going only

other coal chip whether infrastructure the it's is of to some some this even utilization touched haven't to and When manufacturing development the permit so conversations around advancing key be other associated sources. of of or other And standpoint and going growing look you demand. And going with in I that's it's expansions, at on a and reform from brownfield retirements some processes. meet

trading a a real alone. see toward by kind continue global and weather there's being to influenced we opportunity of us So commodity for like to less move

back question-and-answer today's for I'd like to session. to And remarks. concludes his concluding the Degner turn call This you. Thank Mr.

joining like from ahead. the the thank results plan to have and walking this the QX call and for that we us everyone through I'd morning on

Investor follow the feel our We'll free you questions, in you team. see with you. up quarter. next to If have any Relations Thank

in today's you participating Thank conference. for

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