Evolution Petroleum Corporation, Inc.

Good day, everyone, and welcome to the Evolution Petroleum second quarter fiscal year 2023 earnings release conference call. All participants will be in a listen-only mode. Should you need assistance, please email a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star and then one. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I would like to turn the floor over to Ryan Stash, Chief Financial Officer. Please go ahead.

Thank you, and good afternoon, everyone. Welcome to our earnings call for the second quarter of fiscal 2023. Joining me today is Kelly Lloyd, a President and Chief Executive Officer and a member of our Board of Directors. After I cover the forward-looking statements, Kelly will review key highlights along with our operational results. I will then return to provide a more detailed financial review, and then Kelly will provide some closing comments before we open it up and take your questions. 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 risks and uncertainties that are listed and described in our filings with the SEC. Actual results may differ materially from those expected. As 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 moving forward. Please note that this conference call is being recorded. If you wish to listen to a webcast replay of today's call, it will be available by going to the company's website. With that, I'll turn the call over to Kelly.

Thank you, Ryan. Good afternoon, everyone, and thanks for joining us on today's call. Our results in the second quarter of fiscal 2023 were solid and continued to demonstrate our assets' ability to generate strong free cash flow. We used our cash flow to once again fund operations. We used it on capital spending and shareholder dividends. In addition, I'm pleased to report that we have delivered on our commitment to eliminate our remaining debt position during the period. We have now fully integrated multiple acquisitions, paid off our debt, and are generating meaningful free cash flow to fund our strategic objectives. Of course, none of this would have been possible without the hard work of our team. I want to thank all of our team members for their continued dedication and strong execution as we remain focused on driving near and long-term value for shareholders. During the second quarter, we paid a cash dividend of $0.12 per common share. This was 60% higher than the same period for fiscal 2022, which we view as a clear indicator of the growth and strength of our business. Our board recently declared a cash dividend for the third quarter of fiscal 2023 of $0.12 per share. This will mark the 38th consecutive quarterly cash dividend paid by the company since we began our Return of Capital program in December of 2013. Since the inception of the program, we have returned more than $94 million, or $2.85 per share, of capital to shareholders. As we've discussed in the past, there are very few small-cap E&P companies that can say they have consistently paid a dividend for that length of time throughout several tumultuous commodity price cycles. We believe this reinforces the strategic view our board takes as we prudently grow the business through the targeted acquisition of solid, long-life, and low-decline assets that will continue to support businesses a sustainable quarterly dividend for the immediate and long term. In short, maintaining and ultimately growing the payment of a quarterly cash dividend remains front and center for our board and management team. Turning now to operations. Second quarter fiscal 2023 production of 7,250 net BOE per day was down around 5% from the 7,598 net BOE per day for the first quarter of fiscal 2023. In large part, this was due to downtime. associated with the severe winter storms we experienced and, to a lesser extent, some temporary compression issues and some downtime in the barnet associated with offset operator activity. As of now, and barring any future extreme weather circumstances, operations are back on track. Looking at our second quarter results in more detail, net production at Jonah Field for the second quarter was 1,902 BOE per day. Slightly impacting production levels in the second quarter was the decision to maximize natural gas production, thus reducing NGL recoveries during the period to capitalize on relatively higher natural gas prices, which averaged $11.00 per MCF for the quarter. The Jonah field is our most recent acquisition and we remain pleased with its performance. Similar to our other assets, the field is highlighted by long life, low decline reserves that generate significant cash flow. In addition, the asset base provides access to attractive western markets. Second quarter net production for our Williston Basin was quite flat to the first quarter at 489 BOE per day. of which approximately 76% was oil. The Williston Basin oil production was impacted by the winter storms during the quarter. However, this was offset by the reactivation of the One Oak gas pipeline. We were pleased to see the One Oak gas pipeline come back online in late September for the first time since our acquisition. This has led to increased optionality for natural gas in NGL cells. In early January, we, along with the operator, Foundation Energy Management, began operations on one of our Bakken recompletions and continue to work closely with them on high-grading opportunities in the field, such as expense workovers, additional recompletions, and sidetrack drilling opportunities. Also, technical evaluations remain underway to assess our pronghorn and three-forks drilling locations. Net production for the Barnett shale for the second quarter was 3,304 BOE per day, of which approximately 76% was natural gas. As discussed previously, impacting sequential production volumes were severe winter storms, temporary issues at select compression stations, and certain offset operator activities, all of which have been addressed. Hamilton Dome field net production was substantially flat for the second quarter at 413 BOE per day. We continue to support the operator Merritt Energy in their efforts to restore production at previously shut-in wells, adjust water injection locations and volumes, and execute on other targeted maintenance projects. Additionally, in the quarter, we and Merritt began upgrading facilities to proactively reduce emissions throughout the field. Second quarter net production at Del High Field was approximately 1,131 BOE per day. Denberry, the operator at Del High, took steps to minimize the severe weather impacts, which resulted in only minor downtime during the second quarter despite the storms. They are continuing to perform conformance workovers and upgrades to the facilities. With that, I'll now turn the call over to Ryan to discuss our financial highlights.