Oasis Petroleum CEO Discusses Q3 2010 Results - Earnings Call Transcript
Oasis Petroleum (
)
Q3 2010 Earnings Call
November 09, 2010 10:30 am ET
Executives
Michael Lou - SVP, Finance
Tommy Nusz - President & CEO
Taylor Reid - EVP & COO,
Roy Mace - SVP & CAO
Richard Robuck - Director of IR
Analysts
David Deckelbaum
Ron Mills
Andrew Coleman
Presentation
Operator
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Good morning, my name is Monica and I will be your conference operator today. At this time I would like to welcome everyone to the third quarter earnings release and operations update for Oasis Petroleum Incorporated conference call. All lines have been placed on mute to prevent any background noise. After the speakers remarks there will be a question and answer session. (Operator Instructions) Mr. Lou you may begin you conference.
Michael Lou
Good morning everybody, this is Michael Lou, Senior Vice President of Finance. Many thanks for joining us today as we discuss our third quarter results. Joining me today, are Tommy Nusz, President and Chief Executive Officer, Taylor Reid, Chief Operating Officer, Roy Mace, Chief Accounting Officer and Richard Robuck, Director of Investor Relations.
During this call we will provide more details about the acquisition that we announced last night, review our results for the third quarter and then discuss the outlook for the remainder of 2010. This conference call is being recorded and will be available for replay approximately one hour after its completion. The conference call replay in our third quarter 2010 earnings release are available on our website at www.oasispetroleum.com.
In addition, we have updated our investor presentation for November and it is on our website. Although we will not be speaking off the slides during this call, please feel free to refer to it for clarification.
Please be advised that our following remarks, including the answers to your questions, include statements that we believe to be forward looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from those currently anticipated. Those risks include among others, the matters that we have described in our earnings release as well as in our filings with the Securities and Exchange Commission, including our Form S-1 and as amended.
We disclaim any obligation to update these forward-looking statements. Please note that our third quarter 2010 form 10-Q will be filed tomorrow. During this conference call we will make references to adjusted EBITDA which is a non-GAAP financial measure.
Reconciliations of adjusted EBITDA to the applicable GAAP measure can be found in our earnings release or on our website. Since our last call in August we continue to execute our plan to aggressively develop and capture our Bakken acreage. We have maintained our focus on drilling in our core Williston Basin areas, expanded our growth potential and improved our ability to control operations. We are extremely excited by our record quarter and the outlook for the company.
I will turn the call over to Tommy Nusz.
Tommy Nusz
Thank you, Michael and good morning everyone and thank you for joining us today for our second earnings call as a public company. Third quarter can be quickly summarized by the following. First, financial results are positive with volumes growing and LOE moving in the right direction.
Second the capital plan is on track with recoveries in line with expectations and costs under control. And third we are continuing to high grade our acreage position and build on our core operated acreage box. Last night, we issued a news release discussing some of our financial and operating highlights for the quarter and year-to-date ending September 30, 2010.
Like last time, we will try to add some color to that release and update you on our plans for the rest of the year. Then we will open the call up for Q&A. As you know Oasis became a publicly traded company on June 17 of this year. The stock trades on the New York Stock Exchange under the ticker OAS. The IPO provided the capital and liquidity for our season team to execute on our long-term growth plan which is increasing production and reserves and ultimately net asset value for our shareholders.
We have delivered continuous production growth since early 2009 and that trend continued in the third quarter. Specifically in the third quarter we brought eight gross operating wells on production and have 12 more wells currently drilling are waiting on completion. Including operated and non-operated wells we added 7.3 net wells in the quarter and increased overall average daily production to 5,500 to 7 Boe per day, up 149% year-over-year and up 23% over the previous quarter. Overall we expect recoveries for our third quarter wells to be within the tight curve ranges that we have previously laid out for each area. At the end of the quarter, we had 270 million of cash and 120 million available under our revolver. So we're well capitalized for future execution on our operational plan and future growth.
Along with our operational results we also announced an acquisition transaction that will help us to continue to improve operational control over one of our large contiguous lease blocks. As most of you know from our company presentations and previous conversations, Oasis had an AMI in our West Williston area and a project that we call Hebron located in Roosevelt County, Montana, just west of the North Dakota border. Before the deal we had approximately 17,000 net acres that we did not operate with an average working interest of about 50%.
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