Thank you very much for joining us, and I'll just go ahead and turn the call over to Tom.Thomas E. Jorden Thanks, Mark, and welcome, everyone. We had a solid second quarter even with falling commodity prices. As you saw from our release, we reported net income of $64.3 million or $0.74 per diluted share. Our adjusted cash flow from operations this quarter was $240 million, and that's down from $340 million last year. Our second quarter 2012 production volumes averaged 590 million cubic feet equivalent per day, that's up slightly from a year ago of 585.7 million cubic feet equivalent. We continue to see strong growth in the Permian and Mid-Continent, which, combined, averaged 547.7 million cubic feet per day -- cubic feet equivalent per day, growing 17% over last year. And that includes a 37% increase from Permian Basin oil volumes, which averaged 21,694 barrels of oil per day this quarter. Our total company oil production grew 8% to 28,000, 686,000 -- 28,686 barrels per day. Liquids accounted for 46% of our equivalent volumes and 80% of our 343 million of oil, gas and NGL revenue. We saw a decrease in oil, gas and NGL prices this quarter compared to last year, and that didn't surprise anybody. Oil price realizations decreased 12% to $87.81 per barrel. Natural gas prices fell 49%, averaging $2.42 per Mcf. And NGL prices fell $0.36 to average $29.02 per barrel. What we can control is going very well. We're seeing excellent results in our Permian drilling program, and our Cana team is doing a fantastic job, making returns in a difficult natural gas and NGL environment. And I just want to say to underscore that, for those of you who have seen our production table and our area-by-area break down, we've had a tremendous headwind to overcome this year with our Gulf Coast decline, and we've talked about that, ad infinitum in past calls. And I just want to tell you how deeply proud we are here in the executive team of our organization, that's picked up the pace, and the fact that we've overcome that decline in the Gulf Coast is really a testament to our engine of growth we have in that Permian and Mid-Continent program, both our exploration team, our operations team working together, our marketing team. We've had a lot of very difficult challenges so far this year with plant downtimes, and Joe will get into that in some detail. Our core focus is on execution, being good at the business and working our way through the cycles. And we're very proud to report the way this organization has responded to the cycle we're in so far this year.
In the first half of this year, we've drilled 160 gross, 91 net wells, investing $782 million on exploration development. Of our total expenditures, 52% were invested in projects located in the Permian, 44% in the Mid-Continent and 4% in the Gulf Coast and other.And now, we'll move on and give a region-by-region summary, and I'll start with the Permian, which of course is our largest area. We drilled and completed 94 gross or 64 net Permian Basin wells during the first 6 months of 2012, completing 95% of those as producers. Permian E&D capital for the first half was $409 million or 52% of our total capital. Year-to-date, 2012, in our New Mexico Bone Spring program, we drilled and completed 31 gross, 16 net wells, and we're continuing to see outstanding results in that play. Per well, 30-day gross production from the 2012 Bone Spring wells averaged over 600 barrels equivalent per day, 87% of which was oil. We're drilling some of the best wells we've ever seen. Not only are we drilling some very nice wells, we're certainly in the process of, I think, demonstrating to people that we've overcome some of the challenges we had in the last year with high water cuts. A lot of these wells are in extensional new areas, and we're very, very pleased with the results we're seeing out of that program. Read the rest of this transcript for free on seekingalpha.com