Ring Energy, Inc.

Good day and welcome to the Ring Energy first quarter 2021 earnings conference call. All participants will be in listen-only mode. Should you need assistance, please signal 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 then one on your touch-tone phone. To withdraw your question, please press star then two. Please note, today's event is being recorded. I would now like to turn the conference over to David Fowler, Investor Relations Coordinator. Please go ahead, sir.

Thank you, Rocco, and thank you, everyone, for joining us this morning. We appreciate you taking the time to join us and for your interest in Ring Energy. We'll begin our call with comments from Paul McKinney, our Chairman of the Board and CEO, who will provide an overview of key matters for the first quarter. We will then turn the call over to Travis Thomas, our Chief Financial Officer, who will review our detailed financial results. Paul will then discuss our future plans and outlook. Also joining us on the call today are Alex Dice, our Executive Vice President of Engineering and Corporate Strategy, and Marinos Baghdadi, our Executive Vice President of Operations, and Steve Brooks, our Executive Vice President of Land, Legal, Human Resources, and Marketing, all of whom will be available for our Q&A session. During the session, we ask that you limit your questions to one and a follow-up, and then you can and re-enter the queue with additional questions. During the course of this conference call, the company will be making forward-looking statements. Investors are cautioned that forward-looking statements are not guarantees of future performance, and those actual results or developments may differ materially from those projected in the forward-looking statements. Ring Energy disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Accordingly, you should not place undue reliance on forward-looking statements. These and other risks are described in yesterday's press release and in the reports filed with the Securities and Exchange Commission. As a reminder, this conference is being recorded. I will now like to turn the call over to Paul McKinney, Arts Chairman and CEO.

Hey, thank you, David. And welcome, everyone, to our first quarter 2021 earnings call. Let me begin with a few highlights. key highlights of the period. Despite the challenges all of us in Texas faced in February with the unusually severe winter storm and its aftermath, we were pleased to still remain free cash flow positive during the quarter, even with an active drilling program underway. Continuing to generate free cash flow allowed us to further pay down debt and increase our liquidity during the period. As you know, our first quarter sales volumes were significantly impacted by the winter storm. We sold 716,422 barrels of oil equivalent or 7,960 BOEs per day, which was approximately 15% less in the fourth quarter. We incurred shut-in and deferral of more than 60% of our production for the majority of the storm, with restoration of most of the production taking more than two weeks to complete. Our first quarter financial performance was also negatively impacted by additional costs to bring these wells back online. Further contributing to the decrease in sales volumes from the fourth quarter was temporary downtime associated with shutting in offset wells during the completion operations of our four Northwest Shelf Phase I wells we completed during the quarter. We also experienced temporary downtime during the quarter on the nine wells we converted from electrical submersible pumps to rod pumps, or what we call CTRs. Of those nine CTRs, we completed seven in the Northwest Shelf and two in the Central Basin Platform. And as a reminder, and as we have discussed in the past, our CTRs reduce overall operating costs and help stabilize production levels, and we will continue this initiative moving forward. Due to the incredible efforts of our employees during the storm, many of whom at the same time were facing their own challenges at home, were able to return our operations back to substantially pre-storm production levels as quickly as possible. This was evidenced by our average net sales volume of almost 9,100 barrels of oil equivalent per day for March, which does not include approximately 200 barrels of oil equivalent per day associated with the full restoration of certain third-party gas processing facilities damaged during the storm. Our targeted development activities helped to partially offset the impact of the storm as we completed and placed on production the four wells included in the Northwest Shelf Phase I drilling program. We saw collective production from the four wells of 37,550 barrels of oil equivalent in March, and production levels from the wells continue to meet or exceed our expectations. As important, all four wells were completed on schedule and within budget. Finally, we benefited from a much higher commodity price environment during the first quarter, which resulted in a 26% increase in revenues from the fourth quarter despite the impact of the lower sales volumes. This has included an average realized sales price for crude oil of $58 a barrel that was 43% higher than the fourth quarter. For natural gas, our average realized sales price of $6.46 per MCF represented almost a three-fold increase from the fourth quarter and was primarily driven by the spike in natural gas prices during the winter storm. The combined effect from all the factors I just described resulted in first quarter of 2021 adjusted EBITDA of $19 million that contributed almost $3 million of free cash flow. I am pleased to report this marks our sixth consecutive quarter of free cash flow generation. Also contributing to free cash flow during the first quarter was a sale and exchange of certain oil and gas assets in Andrews County, Texas with Den Fisher Operating, Inc., for which we received a net value consideration of $2 million in cash. We utilized a portion of our free cash flow during the first quarter to pay down $7.5 million of bank debt and ended the period with approximately $46 million of liquidity, a 14% increase from the end of the fourth quarter. With that, I will turn the call over to Travis to discuss our financials in more detail. I will then come back to make a few closing comments. Travis?