Laredo Petroleum, Inc.

Good day, ladies and gentlemen, and welcome to Vital Energy, Inc.' 's fourth quarter and full year 2022 earnings conference call. My name is Mandeep, and I will be your operator for today. At this time, all participants are in a listen-only mode. We will be conducting a question-and-answer session after the financial and operations report. As a reminder, this conference is being recorded for replay purposes. It is now my pleasure to introduce Mr. Ron Haygood, Vice President, Investor Relations. You may proceed, sir.

Thank you, and good morning. Joining me today are Jason Paget, President and Chief Executive Officer, Brian Limmerman, Senior Vice President and Chief Financial Officer, Katie Hill, Vice President, Operations, as well as additional members of our management team. During today's call, we'll be making forward-looking statements. These statements, including those describing our beliefs, goals, expectations, forecasts, and assumptions, are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our actual results may differ from these forward-looking statements for a variety of reasons, many of which are beyond our control. In addition, we'll be making reference to non-GAAP financial measures Reconciliations to GAAP financial measures are included in the press release and presentation we issued yesterday, detailing our financial and operating results for fourth quarter 2022. The press release and presentation can be accessed on our website at www.finalenergy.com. We'll now turn the call over to Jason Puget, President and Chief Executive Officer.

Thanks, Ron, and good morning, everyone. We appreciate you joining us this morning. Posted strong results in the fourth quarter and full year 2022 and built value on a foundation of recent oil-weighted acquisitions and the efficient development of our quality portfolio. For full year 2022, we had a strong year with the following highlights. We generated $220 million of free cash flow and $913 million of consolidated EBITDAX. We purchased $285 million of term debt and $37 million of common stock, reducing our leverage multiple 44% from 2.14 times to 1.18 times. We also grew production 19% compared to full year 2021. During the fourth quarter, we generated free cash flow of almost $37 million. We sold non-operated properties for $110 million, and we repurchased more than $100 million of face value term debt and almost $11 million of common stock. And operationally, our oil and total production were above the high end of guidance. We showed continued capital discipline with capital expenditures below expectations. We limited the production impact of severe weather in late 2022 that severely disrupted many Permian Basin operators. Now let's talk about 2023. This is a challenging time for our industry, with oil and gas prices softening over the last few months and service costs remaining high, resulting in lower margins in cash flow. History says the two will find an equilibrium, but this will take some time. We are focused today on what we can control. 2023 plan is designed to maximize free cash flow with emphasis on developing our highest return assets and maintaining the strong balance sheet that we have worked so hard to achieve. 2023 plan, excluding the recently announced driftwood acquisition, is largely focused on our most productive acreage in North Howard County, where we are seeing strong oil production. Current commodity prices, our 2023 development plan is expected to generate more than $70 million of free cash flow. Development drilling continues to bolster our inventory as we have maintained about eight years of oil-weighted inventory, organically adding Wolf Camp D locations in Glasscock County that offset reductions in our Wolf Camp B inventory. For the past three years, we have observed growing industry activity in the Wolf Camp D around our Glasscock County acreage. These results, combined with our own previous drilling results, underpin the addition of 80 Wolf Camp D locations in Glasscock County. On slide six of our earnings presentation, we plot industry activity in the Wolf Camp D around our leasehold and show the results from wells we have developed with modern completions. Last week, we announced that we signed a purchase agreement for the acquisition of the assets of Driftwood Energy, This acquisition gives us a foothold in a prolific part of Upton County, adding about 30 high-margin oil-weighted locations and high oil cut production. Our disciplined approach for creating scale was rewarded with this accretive transaction, and we are confident that it will generate material future value for vital energy. On slide 8, we show the productivity of the acquired PDP wells and believe the undeveloped locations will be competitive with portions of Howard County. We plan to develop this asset over the next several years without increasing activity levels. Finally, we have high confidence in our 2023 plan. Our team is executing extremely well today. We plan to maintain capital discipline in a steady pace of development that will allow us to capture synergies and capital efficiencies. Financially, we have prioritized free cash flow, high margins, and maintaining a strong balance sheet. Now I'll turn the call over to Brian for a financial update.