HighPeak Energy, Inc.

Good day, and thank you for standing by. Welcome to the High Peak Energy 2024 Third Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Stephen Tholen, Chief Financial Officer. Please go ahead.

Good morning, everyone, and welcome to High Peak Energy's third quarter 2024 earnings call. Representing High Peak today are Chairman and CEO Jack Hightower, President Michael Hollis, and I'm Stephen Tholen, the Chief Financial Officer. During today's call, we will make reference to our November investor presentation and our third quarter earnings release, which can be found on High Peak's website. Today's call participants may make certain forward-looking statements relating to the company's financial condition, results of operations, expectations, plans, goals, assumptions, and future performance, So please refer to the cautionary information regarding forward-looking statements and related risks in the company's SEC filings, including the fact that actual results may differ materially from our expectations due to a variety of reasons, many of which are beyond our control. We will also refer to certain non-GAAP financial measures on today's call. So please see the reconciliations in the earnings release and in our November investor presentation. I will now turn the call over to our chairman and CEO, Jack Hightower.

Thank you, Steve. Good morning, ladies and gentlemen, and thank you for joining us today. My prepared remarks will begin on slide four of our November investor presentation. And after looking at our press release and seeing our results, I'm extremely excited to report yet again that High Peak has achieved another solid quarter of execution across the board. Heading into the 2024 calendar year, we laid out a set of core values, including maintaining discipline operations, strengthening our balance sheet, and focus on maximizing shareholder value. Our unwavering commitment to these values has driven our continued success. Operationally, our drilling program has continued to deliver strong well results, and production levels have continued to outperform initial expectations. This has resulted in another beat and raise of our production guidance this quarter, and our operations team has remained aggressively focused on production optimization and reducing our cost structure across the board. Financially, last quarter marks the fifth consecutive quarter that High Peak has generated positive free cash flow. And true to our core values, we have utilized a substantial portion of our free cash flow to pay down absolute debt while simultaneously executing our opportunistic share buyback program. As we set out at the beginning of the year, we continue to implement our primary objective of increasing absolute shareholder value through improved operational results, our return of capital strategy, and ultimately through our strategic alternatives process. So now if you'll turn to page five of the presentation. The third quarter was a huge another operational huge success for High Peak, as our production volumes average over 51,000 barrels of oil per day. This level was higher than our first and second quarter averages this year, even taking into account the continuation of our moderated two-rig development program. Operations during the quarter were affected by a major storm akin to a 100-year flood that hit in early September. This storm caused some of our production volumes to be offline and translated into our lease operating expenses running a little hot during the quarter due to remedial work associated with the storm damage. It's a true testament to our operations team and our robust infrastructure system that a storm of this magnitude only caused minimal shut-in volumes and operational issues. As you can see, our fourth quarter is off to another strong start as production volumes have continued to average over 50,000 barrels of oil per day thus far. We're continuing to see impressive results from our most recent wells, including our extension wells in the northern and northeastern flat top. We remain extremely excited about these areas of the field as well as our potential of upside zones. Mike will provide additional details regarding our continued strong production levels and our recent well results later in the presentation. I'd just like to reemphasize the major positives of these results. In addition, we continue to efficiently convert our products into value for the company, as evidenced by our sustained peer-leading EBITDAX per BOE. Our third quarter results translated into HPI converting 80% of our realized price per BOE into cash. We generated another strong quarter of free cash flow, and we remain in a very healthy financial position. Now turning to slide six, and as you look at this slide, you can realize the raise and the reaffirmation. As I mentioned earlier, as a result of continued strong production volumes, we're going to yet again increase our full year 24 production guidance. Our new range is 48,000 to 51,000 VOEs per day. This range translates to over a 5% increase compared to our prior increase back in August, and a 10% increase compared to our initial 24 guide. This is due to our strong well performance and continued production optimization efforts. We're also reaffirming our 24 lease operating expense and CapEx guidance, which we updated back in August. Our team continues to execute on optimizing our field-wide operations and we remain optimistic there are still some incremental savings we can achieve going forward. We expect our capital expenditures will fall within our narrow range of 540 to 580 million. We've now completed the bulk of our 2024 infrastructure projects, so the vast majority of our capital expenses during the fourth quarter will be associated with drilling and completing wells. On that note, our drilling and completions team is doing a tremendous job in achieving additional cost savings, even compared to the lower cost levels that we realized earlier this year. I believe this is one of the critical areas of our business that not only differentiates from our peer group, but that is also being missed by the public investor universe. Our current cost structure is significantly lower than our Midland Basin peers, and alongside our strong well results absolutely translates into our per well economics competing with anyone in the Midland Basin. Mike will provide additional detail on this topic. but I want to take this opportunity to emphasize this point and to also call out great work that our drilling and completions team is achieving. The key takeaway is that we deliver extremely impressive results to the first three quarters of the year, and I feel confident that this trend will continue. Now I'll turn the call over to our president, Mike Hollis.