Evolution Petroleum Corporation, Inc.

Good day, ladies and gentlemen, and welcome to the Evolution Petroleum first quarter fiscal year 2022 earnings release conference call. At this time, all participants have been placed on the listen-only mode, and the floor will be opened for questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Ryan Stash, Chief Financial Officer. Sir, the floor is yours.

Thank you, Kate. Good afternoon, everyone, and welcome to Evolution Petroleum's earnings call for our first quarter of fiscal year 2022. Joining us today is Jason Brown, President and Chief Executive Officer, and myself, Ryan Stash, Chief Financial Officer. After I cover the forward-looking statements, Jason will review key highlights along with our operational results. I will then return to provide a more in-depth financial review. Finally, Jason will provide some closing comments before we take your questions. As a reminder, if you wish to listen to a replay of today's call, it will be available by going to the company's website or via recorded replay until December 10th, 2021. Please note that any statements and information provided today are time sensitive and may not be accurate at a later date. Our discussion today will contain forward-looking statements of management's beliefs and assumptions based on currently available information. These forward-looking statements are subject to risk and uncertainties that are listed and described in our filings at the SEC. Actual results may differ materially from those expected. Since detailed numbers are readily available to everyone in yesterday's earnings release, this call will primarily focus on our strategy as well as key operational and financial results and how these affect us going forward. Please note that this conference call is being recorded. I will now turn the call over to Jason.

Thank you, Ryan. Good afternoon, everyone, and thanks for joining us today for EVOLUTION's first quarter fiscal 2022. earnings call. Our first quarter represented another period of strong financial performance and continued cash generation that supports our long-term strategy of operating within cash flow and paying an ongoing meaningful cash dividend to our shareholders, which we've been able to do consistently over the past eight years. In addition to our financial performance, the team was able to successfully develop and publish our inaugural corporate sustainability report. It can be found on our recently updated website. I'm proud of the work that the team has accomplished in this regard and would be excited to hear for any feedback that our shareholders would care to give. During the first quarter, we produced 5,843 net BOE per day. That was about 33% higher than the fourth quarter of fiscal 2021. This was primarily due to a full quarter of production from our Burnett Shell assets that were acquired on May 7th. I'm pleased with our team who was able to seamlessly integrate the Barnett assets into our systems without any material ongoing G&A additions. We also benefited significantly from higher commodity pricing as we continue to remain unhedged during the first quarter. These factors combined with the efforts of our third-party operators to leverage efficient field cost structures resulted in an adjusted EBITDA of $8.5 million. This was more than 80% increase from the fourth quarter of last year. We once again generated operating cash flow in excess of capital expenditures, which allowed us to pay our 32nd consecutive quarterly cash dividend. In addition, we were able to grow our cash position to $8 million at quarter end, which is a 51% higher than our cash balance of June 30 of 2021. Now looking at our operating results in more detail. Net production at Delhi for the first quarter was 118,228 BOEs. That's about 1,285 BOEs per day. That's a slight decrease of around 3% compared to the prior quarter. Oil production at Delhi was impacted by decreased reservoir pressure due to the suspension of CO2 purchases from July 15th through August 20th for preventative pipeline maintenance. During the scheduled pipeline repair, the CO2 recycle facility is operated as usual, providing about 80% of the typical injection CO2 volumes. The pipeline is owned and operated by Denberry, and on August 21st, the pipeline maintenance was completed and resumed flowing CO2 at a rate of approximately 85 million cubic feet per day. The operator anticipates being able to increase its rate up to about 110 million, up to about 110 million cubic feet per day during the next quarter, in order to increase pressure to support to the reservoir and hopes to continue the elevated purchase rates throughout the winter and spring. Along with the operator, we are hopeful that these additional CO2 volumes will help to reestablish the reservoir pressure and some of the subsequent associated production that was lost as a result of the temporary pipeline failure in fiscal 2020. In Hamilton Dome, we saw a sequential quarterly increase in production of 2% to 37,145 barrels. or 404 barrels of oil per day. This is primarily due to continued reactivation of previously shut-in wells, strategic adjustments to water injection locations and volumes as the operator merits field projects remain focused on maintenance, restoring production, and optimizing the field. Net production of the Barnett JL AFTA for the first quarter of fiscal 2022 382,115 BOEs, or 4,153 BOEs per day. This is about 59% higher than the fourth quarter of fiscal 2021. Increase mostly was due to this being a full quarter production compared to 55 days in the prior quarter due to our closing the purchase of the assets on May 7th. As we discussed in our last call, Blackbeard operating, the primary operator of our Barnett Shell assets, sold their interest to Diversified Energy Company in July of 2021. We look forward to providing more detail on the expected future CapEx and operational plans that the Barnett assets once diversified has finalized their plans upon completion of the transition period. And although we are pleased, we've already received a workover for the reactivation of the saltwater disposal well from them, which will allow the return of production for four offset wells. So this is exactly the kind of work that we anticipate from Diversified, and we are excited about other high rate of return projects that we can participate with them on those assets. Our Barnett shale acquisition has materially increased our exposure to natural gas through the acquisition of another long life low decline asset. We're excited about what that accretive acquisition does for our company and our shareholders moving forward. This purchase was particularly well timed considering the sharp increase we've seen in natural gas prices in recent months. Consistent with our successful past strategy, we'll continue to evaluate additional accretive opportunities to expand our business for the long-term and benefit of our shareholders. These efforts support our long-term focus on continuing to operate within cash flow as we maintain and potentially increase the cash dividends that we pay to our shareholders over time. Despite the challenges of 2020, we've been proud of our commitment to return meaningful value to our shareholders through a consistent dividend program. This includes increasing our first quarter fiscal 22 dividend to 7.5 cents per common share of stock, and that was paid in September. Supported by continued improvement of our business and economic environment, we are pleased to declare a second quarter dividend that will be paid on December 31st to shareholders of record as of December 15th. With this dividend, Evolution will have paid out $80 million, over $80 million, or $2.41 per share, back to shareholders as cash dividends since 2013. Maintaining and ultimately growing our stock dividend along with achieving disciplined growth through accretive acquisitions remain our key priorities moving forward, and we appreciate continued support of our shareholders. With that, I'll now turn the call over to Ryan to discuss our financial highlights.