Antero Midstream Corporation

Greetings and welcome to the Antero Midstream Third Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. And it is now my pleasure to introduce to you Justin Agnew, Director of Finance. Thank you, Justin. You may begin.

Good morning, and thank you for joining us for AnteroMidstream's third quarter investor conference call. We'll spend a few minutes going through the financial and operating highlights, and then we'll open it up for Q&A. I would also like to direct you to the homepage of our website at www.anteromidstream.com, where we've provided a separate earnings call presentation that will be reviewed during today's call. Today's call may also contain certain non-GAAP financial measures. Please refer to our earnings press release for important disclosures regarding such measures, including reconciliations to the most comparable GAAP financial measures. Joining me on the call today are Paul Rady, Chairman, CEO, and President of Antero Resources and Antero Midstream, Brendan Krueger, CFO of Antero Midstream, and Michael Kennedy, CFO of Antero Resources and Director of Antero Midstream. With that, I'll turn the call over to Paul.

Thanks, Justin. In my comments, I will discuss the multi-decade inventory dedicated to AM at the AR capital efficiency achievements in 2023. Both of these attributes support the attractive and de-risked long-term outlook at AM. Brendan will then discuss our third quarter financial results, repeatable free cash flow business model, and 2022 ESG highlights. I'm going to start my comments on slide number three, titled Consistent Growth and Large Low-Cost Inventory Dedicated to AM. This slide highlights the throughput growth at AM and drilling inventory for the natural gas piers at a $2.75 break-even NYMEX gas price. During the third quarter, AM once again delivered double-digit year-over-year throughput growth. With gathering volumes well over 3 BCF a day, AM now gathers roughly 3% of the total natural gas production in the United States, highlighting the growth and scale of AM's operations since 2021. Similar to AM's organic growth strategy, AR has executed its organic leasing program, investing $340 million in land capital since 2021. The result is over 22 years of inventory dedicated to AM based on the 2023 development pace as depicted on the right-hand side of the page. So while Hentero Midstream's gathering volumes have increased nearly 15% since 2021, AR has more than replenished the multi-decade inventory that drove the throughput growth over that timeframe. This organic leasing strategy is not only cost-effective for AR, but incredibly capital efficient at AM. A majority of the land capital is invested to extend laterals, fill in acreage positions, and block up AR's already contiguous acreage position. This results in more production and reserves per well for AM, as well as more capital efficient infrastructure build-outs within the consolidated acreage positions. Now let's move to slide number four, titled Most Capital-Efficient Customer in Appalachia. This slide illustrates the year-over-year change in production on the y-axis and the year-over-year change in drilling and completion capital on the x-axis. While targeting a maintenance capital program, AR's third quarter 2023 production actually grew 9% year-over-year. This growth, combined with the contributions from the bolt-on acquisitions and drilling partnership, translated to a 13% year-over-year increase in gathering volumes at AM. Conversely, when AR's peer group attempted to target a maintenance capital program, their volumes actually declined year-over-year. When you compare the production growth to the drilling and completion capital invested to deliver this growth, AR has been far and away the most capital efficient operator in Appalachia over the last year. For reference, AR is consistently running two to three rigs and one to two completion crews, which is a very manageable and balanced development program for one of the largest natural gas producers in the U.S. This peer-leading capital efficiency combined with strong balance sheet at AR underpins the consistent development program that drives repeatable results at AM. In summary, we continue to be one of the most capital efficient midstream companies in the industry. The multi-decade, repeatable, low-cost inventory dedicated to AM combined with our unparalleled visibility consistently generates high teens' return on invested capital, or ROIC. These peer-leading returns on invested capital, further supported by AR's peer-leading capital efficiency, continue to drive value for AM shareholders. With that, I turn the call over to Brendan.