PETRUS CEO AND CFO INTERVIEW 12 01 2022First thanks to WRIG for posting the internet interview, very encouraging information shared by Ken Gray and Matt( Scanderup(CFO).
Here are my notes, please correct if any misinterpretations.
Projects 65% increase in Free Cash Flow for 2023.
From $140mm to $150mm/year/2023
Capex @ $130mm-$135mm/2023
Production up to 13000 BOE/Day, average over the year
This equates to a 75% increase in production over 2022
History: in early 2022, debt was a problem, restructuring debt in May 2022 allows expansion in drilling activity
June 2022, 2 rigs running, wells coming online early October
Spent 88mm/2022 Drilling program
Last activity report @ 8000 BOE/Day
Matt: 15 wells, finishing now, 3 more to complete by end of 2022
Guidance was 10500 to 11000, comfortable that they will accomplish year end goal
De-bottlenecking in field, so takes time
It will be a busy month December to get everything to hit guidance
Projection/2023: 13000-13500 BOE/day, average, this equates to 75% over 2022
NG weight is 60%
Liquids weight is 40%
of liquids, 27% oil, rest of liquids is NGL
Gas/Oil Ratio(GOR) new wells are a lot lower GOR, especially at start of wells, then GOR increases, Gas weight will increase as year goes on, but higher Oil weight with these new wells
Budget> Qtr 3 Debt @ $50mm, will carry at this level into 2023, and bring debt down next year.
On target> $85mm-$90mm cash flow for 2022
Cash Flow objective is $130mm-$135mm
with additional planned capex/with continued drilling
capex= largely drilling and completion of wells
Cash Flow expects for 2023 $140mm-$150mm(n.b., this does not concur with earlier $135mm-$135mm cash flow, so I do not know why this was subsequently stated differently that earlier in interview, but these two data points are close, lol)
"Sitting on great assets, now 'Going After It'(KGray)
Price Assumptions(2023)
$77 WTI
$4 mcf/gas
Sensitivity to lower/higher prices?
'We are hedged, so short term price moves do not effect us as much
Total of 50% hedge first year out
"We are flexible, can adjust to market conditions, not committed or forced to drill.
Budget based on slightly lower than prices we see now.
Split company, 1/2 liquids, 1/2 gas, ergo not entirely tied to oil prices.
We are a low cost producer, if we did not like low prices, we could drill less.
Conversely, if prices are higher, better than expected, we could accelerate drilling'
program as well/we have FLEXIBILITY.
? What sets Petrus apart from the field, similar sized O+G players?
KG> not many others looking at 75$ production growth, nor 65% cash flow growth
KG: keep in mind, this is Organic Growth, more substantial growth than many others in the field.
Should see fairly good share price appreciation, we are somewhat unique among field.
MS: Continue to execute program to end of year, keep story going forward in 2023
vocex comment: sounds good to me, continue to add into recent oil pricing fallback.
GLTA