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TheStreet Open House

Forest Oil Management Discusses Q2 2012 Results - Earnings Call Transcript

Some of the presenters today will reference certain non-GAAP financial measures regularly used by Forest in measuring its financial performance. Reconciliations of such non-GAAP financial measures with the most comparable financial measure calculated in accordance with GAAP will be available on our website and viewed by clicking on the Investor Relations tab, then non-GAAP at forestoil.com. In addition, I'd like to caution you about our forward-looking statements. All statements other than statements of historical facts that address activities and outcomes that Forest expects, assumes, plans, believes, budgets, forecasts, projects, estimates, anticipates, et cetera, about, what will, should or may occur in the future are forward-looking statements. Please carefully review our cautionary language regarding forward-looking statements as its contained at the end of our press release.

And with that, I'll turn the call over to Michael Kennedy.

Michael N. Kennedy

Thanks, Larry, and thanks to everyone joining us today. I'll keep my comments relatively brief and touch on a couple of the highlights for the quarter, as the press release issued yesterday afternoon covers the quarter in detail. Second quarter 2012 equivalent production came in at 335 million per day. This is unchanged on a year-over-year basis. Our focus on oil projects continues to pay dividends, as second quarter oil volumes increased 27% over the same period last year. This effort trend will continue as Forest Oil 4 of our 5 rigs targeting oil projects by the fourth quarter.

Third-party infrastructure issues in the Panhandle persisted in the second quarter, which negatively impacted production by approximately 8 million per day due to downtime associated with the third-party NGL facility. The plant was return to operations on July 3. Unplanned downtime is frustrating and we continue to incorporate additional gas gatherers for our Panhandle production. This will provide us with flexibility and optionality, and should help to minimize these unplanned curtailments going forward. We should begin to see these benefits beginning later this year.

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