Pedevco Corp.

Good afternoon and welcome to the Devco Corp.'s second quarter 2026 earnings conference call. All participants are in listening mode. After the prepared remarks, we will open the call for questions. I would now like to turn the call over to Laurent Wao of Elevate IR. Please go ahead.

Thank you, operator, and good afternoon, everyone. Welcome to Pedevco's second quarter 2026 earnings call. With me today are Doug Schick, President and Chief Executive Officer, R.T. Dukes, Chief Operating Officer, and Bobby Long, Chief Financial Officer. Before we begin, I'd like to remind everyone that today's discussion includes forward-looking statements within the meaning of the federal securities laws, subject to risks and uncertainties that could cause actual results to differ materially from expectations. For more information, please refer to our second quarter 2026 form 10Q and other SEC filings. The company undertakes no obligation to update or revise any forward-looking statements. During today's call, we will discuss certain non-GAAP financial measures including adjusted EBITDA and working capital excluding derivative contract assets and liabilities. Reconciliations to the most directly comparable GAAP measures are available in our earnings release and 10Q filing. These non-GAAP measures should not be considered in isolation or as a substitute for GAAP results. I would also like to note that all per share and share count figures referenced today reflect the company's 1 for 20 reverse stock split effective March 13, 2026, applied retroactively to all periods presented. As of June 30, 2026, the company had approximately 13.3 million shares of common stock outstanding. Here is today's agenda. Doug will begin with opening remarks, followed by Archie with an operational update, and then Bobby will walk through our financial performance. After our prepared remarks, the management team will open the call for questions. With that, I will turn it over to Doug.

Thanks, Laurent, and good afternoon, everyone. Thank you for joining us. We are now halfway through 2026 and the second quarter provides a clear view of the earnings power of the platform we've built through the Juniper merger. Production averaged approximately 6,800 VOE per day. Revenue was 46.1 million and adjusted EBITDA was 18.7 million. Revenue increased more than fivefold year over year and approximately 15% sequentially. These results were ahead of our original expectations and reflect the combination of stronger realized oil prices and the expanded production base. To put year-over-year comparisons in perspective, Devco was a much smaller company in the second quarter of 2025 with no debt and approximately $7 million of quarterly revenue. Today, we operate across three basins, produce more than 618,000 barrels of oil equivalent during the quarter, and generated $46.1 million of revenue. This increase in scale reflects the strategic transaction we made last October to merge with the Juniper portfolio companies, which expanded our footprint to more than 300,000 net acres across the DJ, Powder River and Permian basins with substantial oil-weighted production and a deep development inventory. We said at the time of the merger, we would significantly increase the scale and cash generating capacity of the company and the second quarter results demonstrate that progress. Turning to sequential comparisons, it is important to distinguish the impact of price from the impact of volumes. Production declined 16% from the first quarter, consistent with the production expectations we discussed on our last call. The DJ Basin wells that came online in late 2025 reached peak production early this year and have since followed their natural decline curves. As a result, the sequential improvement in revenue was driven mostly by oil prices. Our average oil price increased to $94.07 per barrel, up 53% year-over-year, and operating income more than doubled sequentially from $6.7 million to $15.4 million. Higher commodity prices, when sustained, improve the return profile of our inventory, but they do not change our approach. We are not building a plan that depends on elevated commodity prices. Our focus remains on low-cost operations, a strong balance sheet, and deploying capital only where the expected returns justify it. Turning to cost, lease operating expense was essentially flat with the first quarter on an absolute basis. Per unit costs were higher because production declined while absolute costs remained relatively stable. RT will discuss the optimization program in more detail, but our focus is on pump conversions, recompletions, well cleanouts, and compression projects that are expected to reduce recurring operating costs going forward. As those savings are realized, we expect them to improve margins and strengthen the cost structure of the business over time. The balance sheet also improves significantly during the quarter. We repaid $13 million of debt under our revolving credit facility, reducing the outstanding balance to $85 million from $98 million at the end of the first quarter. Strong cash generation allowed us to accelerate debt repayment while maintaining cash on hand. Coming out of the merger, we carried a meaningful working capital deficit. That overhang was largely resolved in the first quarter, and in the second quarter, we turned to reducing our funded debt. Adjusting for cash, net debt was approximately $73 million at quarter end. This progress gives us greater flexibility as we evaluate additional development opportunities. With this balance sheet strength and months of asset analysis, permitting, and development planning, we are now in a position to consider a more active development program. During the first half of the year, we maintained a measured approach to capital allocation focusing mostly on our production and cost optimization program and directed excess cash towards strengthening the balance sheet. That was the appropriate approach for the business and it produced the results we expected. Our stronger financial position, a more constructive commodity price environment, and the resolution of certain litigation matters in Wyoming now allow us to begin a more active development program for the remainder of the year in early 2027. Over the past several months we have conducted extensive analysis on our 300,000 plus acre position and have identified actionable high rate of return projects available for near-term development. We have recently completed a previously drilled well in the DJ Basin and over the next several months we plan to drill and participate in over 20 gross wells across our asset base. We will be announcing the details of this expanded capital program and development plan in the coming weeks. With $36.8 million of adjusted EBITDA generated in the first half, we are reiterating our full year 2026 adjusted EBITDA guidance of $60 million to $70 million. The expanded second half development program is not expected to contribute until late 2026 and early 2027, and our outlook for the balance of the year reflects the production outlook we have discussed previously. More broadly, our capital allocation framework remains straightforward. We will prioritize a strong balance sheet and the operating integrity of the existing asset base. We will then invest in optimization and development projects that meet our return thresholds while preserving the flexibility to pursue acquisitions and leasehold opportunities that strengthen our core positions. The expanded platform gives us more ways to create value, but it does not change the discipline we apply to each and every investment decision. Taken together, we are entering the second half of the year from a stronger position than we expected at the start of 2026. The combined platform is generating meaningful cash flow, the balance sheet is healthy, and we have the flexibility to fund a disciplined development program while maintaining our return thresholds and financial priorities. With that, I will turn it over to RT.