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SandRidge Energy's CEO Discusses Second Quarter Results - Earnings Call Transcript

Additionally, we'll make reference to adjusted net income, adjusted EBITDA, and other non-GAAP financial measures. A reconciliation of any non-GAAP measures we discuss can be found in our earnings release and on our website.

Please note that this call is intended to discuss SandRidge Energy and not our royalty trust. The trust will be addressed on separate calls on August 10. Also, SandRidge will file an (NQ) on Monday, August 6. Now let me turn the call over to Tom Ward.

Tom Ward



Thank you, James. Welcome to our second quarter operational update. As you've read, we announced another very solid performance this quarter driven by the growth in oil production. The key themes I will discuss this morning that differentiate SandRidge are as follows:

Low risk shallow carbonate drilling with low costs, willingness to lock in future profits through hedging, and our increasing balance sheet strength. The SandRidge management team has operated differently than most of our peers over the last few years. We built our foundation on shallow, conventional, low risk oil assets.

The Central Basin Platform in the Permian Basin is a good example. In 2008, we produced 4,000 barrel of oil equivalent from this area and today, we produce over 30,000 net barrel of oil equivalent per day from shallow carbonate vertical wells.


The Central Basin Platform continues to provide repeatable low risk, high rate of return drilling opportunities. Even though the wells only average 53 barrels of oil equivalent per day during the 30 day peak period, the low costs associated with the drilling and completion of these wells makes them very attractive investments and efficient use of capital.

By buying in an area with a long history of production, we not only lowered our drilling risk but also do not have the issues with takeaway capacity as others experience in newer, more crowded areas of the Permian. This last quarter, we drilled 206 Central Basin Platform wells and plan to continue with this program in the future and maintain a ten year inventory of drilling locations.

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