Range Resources Corporation

Welcome to the Range Resources first quarter 2020 earnings conference call. All lines have been placed on mute to prevent any background noise. Statements made during this conference call that are not historical facts are forward-looking statements. Such statements are subject to risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements. After the speaker's remarks, there will be a question and answer period. At this time, I would like to turn the call over to Mr. Laith Sando. Vice President, Investor Relations at Range Resources. Please go ahead, sir.

Thank you, operator. Good morning, everyone, and thank you for joining Range's first quarter earnings call. The speakers on today's call are Jeff Ventura, Chief Executive Officer, Dennis Degner, Chief Operating Officer, and Mark Scucchi, Chief Financial Officer. Hopefully you've had a chance to review the press release and updated investor presentation that we've posted on our website. We also filed our 10Q with the SEC yesterday. It's available on our website under the Investors tab, or you can access it using the SEC's EDGAR system. Please note, we'll be referencing certain non-GAAP measures on today's call. Our press release provides reconciliations of these to the most comparable GAAP figures. For additional information, we've posted supplemental tables on our website, to assist in the calculation of EBITDAX, cash margins, and other non-GAAP measures. With that, let me turn the call over to Jeff.

Thank you, Laith, and thanks everyone for joining us on this morning's call. Before we review the quarter, I would like to thank all of our employees and service providers for their hard work and dedication to keep our business plans on track while ensuring the health and safety of our employees and their families. In particular, Our field employees have continued to deliver each day on our well sites while practicing social distancing, adhering to CDC guidelines, and helping us supply the much needed energy the world relies on during a crisis. Natural gas is a critical resource that powers our everyday lives, as well as helps to provide critical electricity to hospitals and clinics. One step further, the NGLs we produce are being used as a feedstock for life-saving medical equipment Cleaning Supplies, and Medicine. RANGE's culture has always been one to lend a hand, roll up our sleeves, and help our community. Earlier this month, RANGE provided more than $100,000 to nonprofit organizations supporting those that need it most in our local areas. On top of this program, RANGE has donated protective health supplies to area medical providers and technology to multiple school districts for students to be able to participate in remote learning. These are unique and challenging times in our industry and in the world. I believe it's during these moments that we really come closer together and grow stronger, supporting each other in our local communities. I especially want to thank those that are working each day on the front lines of this pandemic, as is the case for numerous range family members and likely the case for many listening to the call. We appreciate you taking time to join us today and wish the best for you and your families. Reflecting on the first quarter, Range continued to make steady progress on key strategic initiatives. We improved our cost structure, bolstered liquidity, operated safely and efficiently, and maintained a peer-leading base decline in capital efficiency. The results of these efforts are reflected in our first quarter results and have better position Range to navigate a difficult commodity environment. Looking forward, I believe RANGE is very well positioned to benefit from an improving macro for natural gas and natural gas liquids. Looking first at unit cost, RANGE's unit costs have improved by 20 cents per MCFE since the first quarter of last year. These cost improvements have resulted from a focused effort to find margin-enhancing cost reductions across our various line items led by a 13-cent improvement in transportation, gathering, and compression and processing expense and greater than 10% improvements in both G&A and interest expense. These are lasting improvements that will endure through price cycles. Mark will highlight some of these efforts in more detail. Just as important as these lasting improvements to unit costs are the decisive actions we've taken to de-risk our balance sheet and bolster our liquidity. Early in the first quarter, Range refinanced $550 million in debt Improving Our Maturity Profile Later in the quarter, the banks reaffirmed their commitments on our credit facility of $2.4 billion, solidifying Range's liquidity. When combined over $1 billion in successful asset sales completed over the last 18 months, we have materially de-risked our go-forward plans. We remain focused on continuing this trend of absolute debt reduction Thank you for joining us. Using Clean Burning Natural Gash to International Customers Using Propane and Butane for Heating and Cooking. Like we discussed on our call in February, we're going to adjust our capital spending plans if near-term commodity prices were challenged. So in March, we announced a reduced capital budget of $430 million. This is greater than a 40% reduction in capital versus 2019, and I believe this operational plan, which holds 2.3 BCFE projects, This level of capital efficiency is made possible because of our low well costs that are approaching $600 per foot, but it's also driven by our shallow base decline. Range's base decline rate of approximately 20% is lower than our gassy peers and significantly better than most oil producers. which means that range has a smaller wedge of production that needs to be replaced each day to hold production flat as evidenced by this year's capital plan. Importantly, this year's operational programs positions as well heading into 2021 which Dennis will touch on in a minute as we are not relying on significant duct drawdowns or sizable prior year outspends to accomplish our 2020 plans like some other companies appear to be. Instead, Our peer-leading capital efficiency is sustainable into 2021 and beyond and to what we believe will be a better market for natural gas and NGLs. Range's sizable core inventory, measured in decades, provides us the long-life repeatability that is a positive differentiator for Range. We believe this will become more evident over time as inventory life and core exhaustion become growing narratives for other operators in Appalachia and in other basins. Before turning it over to Mark and Dennis, I'll reiterate how proud I am of the efforts the Range team has made during these challenging times. Our employees in the office and in the field have shown a great deal of dedication and innovation in making sure the company continues to make progress on our key objectives, all while prioritizing the health and safety of one another. You have made Range an even stronger company as a result. Over to you, Dennis.