Ring Energy, Inc.

Good morning, and welcome to the Ring Energy fourth quarter and full year 2024 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. To ask a question, you may press star, then one on a touchtone phone. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to send a call over to Al Petrie at Vessel Relations for Ring Energy. Please go ahead.

Thank you, Operator, and good morning, everyone. We appreciate 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 fourth quarter and full year 2024, as well as our outlook. We will then turn the call over to Travis Thomas, Ring's Executive VP and Chief Financial Officer, who will review our financial results. Paul will then return with some closing comments before we open the call up for questions. Also joining us on the call today and available for the Q&A session are Alex Diaz, Executive VP and Chief Operations Officer, and Shawn Young, Senior Vice President of Operations. During the Q&A session, we ask you to limit your questions to one and a follow-up. You're welcome to re-enter the queue later with additional questions. I would also note that we have posted an updated investor corporate presentation on our website. During the course of this conference call, the company will be making forward-looking statements within the meaning of federal securities laws. 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. Finally, the company can give no assurance that such forward-looking statements will prove to be correct. 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 our feelings with the SEC. These documents can be found in the Investors section of our website, located at www.ringenergy.com. Should one or more of these risks materialize or should underlying assumptions prove incorrect, actual results may vary materially. This conference call also includes references to certain non-GAAP financial measures. Reconciliations of these non-GAAP financial measures to the most directly comparable measure contained in yesterday's earnings release. Finally, as a reminder, this call is being recorded. I'd now like to turn the call over to Paul McKinney, Chairman and CEO.

Thanks, Al, and good morning, everyone, and thank you for joining us today. The fourth quarter of 2024 represented a strong ending to a year in which the Ring Energy team enhanced nearly every controllable metric. Our total sales grew 8% over 2023 to a record 19,648 barrels of oil per day. And oil sales grew 6% to a record 13,283 barrels of oil per day. We reduced our year-over-year all-in cash operating costs on a per BOE basis by 2%. We drilled 13 more wells in 2024 than the prior year for slightly less capital, representing a substantial increase in capital efficiency for both our horizontal and vertical wells. For the year ended December 31, 2024, we spent $151.9 million, which included cost of drill complete and place on production, 21 horizontal wells, including five in the northwest shelf and 16 in the northern portion of the CBP, and 22 vertical wells in the CBP. Also included in the full-year capital spending were costs for capital workovers, infrastructure upgrades, recompletions, facility upgrades to reduce emissions, and leasing. We paid down debt by $40 million and $70 million since the closing of the founder's acquisition in August of 2023. We exited the year with $385 million of debt on the balance sheet and approximately $217 million of liquidity. Our performance led to generating adjusted EBITDA of $233.3 million despite a 7% reduction in realized prices. Supported by our focus on capital discipline, we delivered adjusted free cash flow of $43.6 million, remaining cash flow positive for over five years. Turning to reserves, we grew approved reserves by 4.4 million barrels of oil equivalent, or 3%, to 134.2 million barrels of oil equivalent. A key point to note regarding our 2024 reserves was that we organically added 16 million barrels of oil equivalent that more than offset the 7.2 million barrels of oil equivalent of production, the 1.2 million BOE from sales of non-core assets, and 3.2 million BOE in reserve reductions due to lower SEC prices. Approved reserves PV10 was approximately 1.5 billion at year end 2024. Included in that total was approximately 1.1 billion of PV10 for 92.6 million barrels of oil equivalent approved developed reserves. The primary contributors to our success in 2024 are directly related to the benefits of our stronghold and founders acquisitions in 2022 and 23. These acquisitions have exceeded our expectations in many regards, further established our strategic foothold in the Central Basin Platform, and significantly increased our undeveloped inventory of highly economic drilling locations. As we have previously stated, we continue to look for similar acquisitions that can help us replicate the success of those two transactions. We believe the proposed Lime Rock transaction does that. As previously released, the purchase price of $100 million is comprised of 80 million of cash and up to 7.4 million shares of Ring common stock at closing, and an additional $10 million deferred cash payment due nine months after closing. The transaction has an effective date of October 1, 2024, and is expected to close by the end of the first quarter of 2025. In short, Lime Rock CBP acreage is in Andrews County, Texas, where the majority directly offsets Ring's core Shafter Lake operations, and the remaining acreage to the south is prospective for multiple horizontal targets and exposes Ring to active new players. The acquisition ideally suits Ring's focus on consolidating and producing assets in core counties on the CBP, defined by shallow declines, high margin production, and undeveloped inventory that immediately competes for capital. Additionally, and as previously disclosed, these assets add significant near-term opportunities for field level synergies and cost savings. Regarding our guidance for 2025, our estimates include three full quarters of operations with the Lime Rock assets. Driving the top line, we anticipate an average annual sales midpoint of 21,000 barrels of oil equivalent per day and 13,900 barrels of oil per day a 7% and 5% increase, respectively, and an annual capital spending midpoint of $154 million, essentially flat with the prior year, and a midpoint of approximately 49 total wells drilled, completed, and placed online. In summary, our 2025 plans will follow a very similar playbook from the past. We will remain focused on maximizing free cash flow generation, We will maintain a disciplined capital spending program that maintains or slightly grows our production and liquidity, and allocate the balance of our cash flow to paying down debt. Travis will provide more detail regarding our guidance, along with other comments concerning our fourth quarter and full year financial results. So with that, I will turn it over to Travis. Travis?