Certain information regarding Penn West and the transactions and the results discussed during the conference call including management’s assessment of future plans and operations may constitute forward-looking statements under applicable securities laws and necessarily involve risks. Participants are directed to Penn West second quarter news release and are also asked to review the advisory notice therein. This news release can be found at www.pennwest.com. Participants are also cautioned that the included list of risk factors contained within that release is not exhaustive.Official information detailing other risk factors that could affect Penn West operations or financial results are included in reports on file with Canadian and U.S. Securities Regulatory Authorities and maybe accessed through the SEDAR website at www.sedar.com and the SEC website at www.sec.gov or at our own website www.pennwest.com. During this conference call certain references to non-GAAP terms may be made. Participants are directed to Penn West MD&A and financial statements available on our website as well as filings available on the website noted earlier to review disclosures concerning non-GAAP items. I will now turn the call over to Murray Nunns, President and Chief Executive Officer. Murray? Murray Nunns Thank you, Jason and good morning, everybody. Penn West strategies over the past five years really supported the evolution of the company away from the limitations of vertical development and into increasingly profitable horizontal technologies. We have a history of proactive balance sheet management through ongoing strategic portfolio management which has included world class joint ventures and timely material asset dispositions. This has allowed us to execute our strategies which has ultimately led to significant increases in the intrinsic value of Penn West assets. Two years ago less than 2% of Penn West production came from well bores using horizontal multi frac technology. By the end of this year, we anticipate 30% of our production will come from horizontal multi-frac wells.
These new light oil wells deliver significantly higher rates of returns in the long run. The value of this technology has added to our asset base and will only continue to grow in the future. Over the years Penn West has assembled and unlocked some of the most valuable plays in this basin.Additionally, our portfolio includes a broad inventory of oil related properties which are not critical to our go forward strategies. We have demonstrated the abilities to sell these core assets at attractive valuations to accomplish strategic goals such as new play development or balance sheet support. We have demonstrated our ability to make these deals happen and we believe that we are in a strong position today to achieve material value for the assets currently being considered for sales. Hilary will give you more color on this later in the call, but make no mistake we have the best of inventory and the ability to transact with a broad spectrum of potential buyers. Commodity pricing is cyclical and is impacted by broad economic factors as well as obviously speculative volatility. We are mindful of these impacts on our business and we exercise prudent strength in all parts of the pricing cycle. Additionally, pricing differentials between US benchmark WTI and Canadian crude oil streams have been weighing on Western Canadian producers for several months now. At times, the differential has been as much as $25 a barrel. While this has narrowed considerably since Q2, the volatility of this differential is persistent and has a significant impact on our netbacks. In both the US and Canada, active pipeline projects in various stages of completion indicate that there will be an easing of capacity constraints on Canadian crude in 2013. Current infrastructure projects alone will not solve all the transportation refining access limitations in North America in the longer-term, but they are significant start. Export access from Canada and increased access to US refining is necessary for Western Canadian producers to fully realize the potential value of Canadian oil. Taking into consideration the impact of ongoing differential volatility in the hydrocarbon pricing and on our price realizations, we have adjusted our capital plans accordingly for the remainder of 2012. Read the rest of this transcript for free on seekingalpha.com