SilverBow Resorces, Inc.

Good day and welcome to the Silver Bowl Resources second quarter 2022 earnings conference call. Please note today's conference call is being recorded. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star followed by the number one again. Thank you. At this time, I turn the conference over to Jeff Maggots, Director of Finance and Investor Relations at Silver Bowl Resources.

Thank you, Erica, and good morning, everyone. Thank you very much for joining us for our second quarter 2022 conference call. With me on the call today are Sean Wolverton, our CEO, Steve Adam, our COO, and Chris Abundus, our CFO. Yesterday afternoon, we posted a new corporate presentation to our website and will occasionally refer to it during this call. We encourage listeners to download the latest materials. Please note that we may make references to certain non-GAAP financial measures, which are reconciled to their closest GAAP measure in the earnings press release. Our discussion today may include forward-looking statements, which are subject to risks and uncertainties, many of which are beyond our control. These risks and uncertainties are described more fully in our documents on file with the SEC, which are also available on our website. With that, I will now turn the call over to Sean.

Thank you, Jeff, and thank you everyone for joining our call this morning. It has been a dynamic first half of the year to say the least. While commodity prices have marched steadily higher in 2022, the degree of market volatility underscores the importance of remaining disciplined. Our accomplishments in the second quarter were critical to our strategy and marked an inflection point for our growth going forward. To briefly recap the quarter, we closed the Sandpoint and Sundance transactions, marking the fourth and fifth acquisitions we have closed in the last 12 months. The largest of these was our Sundance transaction, which closed on June 30th. In conjunction, Our borrowing base was upsized approximately 50% to $775 million, and we added a second rig to our drilling program, which is dedicated to developing these oil-weighted assets. We funded the cash portion of the purchase price through our credit facility and operating cash flows, while also ending the quarter with more liquidity than we had at the end of the first quarter. On slide 11 of our presentation, we outline Silver Bow's strategic objectives, which are the roadmap for our business. First, we are targeting double-digit production growth while living within cash flow. Second, we are focused on expanding our inventory through accretive acquisitions and organic leasing. Third, We want to lead our peers in capital efficiency and cost structure. And last, our fourth objective is to deliver the balance sheet through debt reduction and greater cash flows. We expect to grow our production approximately 30% in both 2022 and 2023. Our second quarter production increased as we brought online production from new wells and contribution from the sand point assets. Upon closing Sundance, we added a rig to develop our recently acquired oil inventory. Taken together, the step up in drilling activity and contribution from acquired production will drive meaningful growth going forward, with second half production approximately 35% higher than the first half of this year. Our second strategic objective is to expand our inventory, and we made significant progress on this front during the quarter. The Sandpoint and Sundance acquisitions added approximately 200 net drilling locations to our portfolio, and we now have over 600 high return locations across a balanced mix of both oil and gas. This supports more than a decade of drilling at our current two-rig pace. Our third objective is to lead our peers in capital efficiency and cost structure. Our growth next year is underpinned by a reinvestment rate of approximately 60% and a free cash flow yield greater than 25%. Our efficiencies have offset some inflationary cost pressures, and we've been able to deliver on our planned CapEx targets. As Steve will further detail, We also expect to realize cost synergies as the team integrates the acquisitions into our low-cost platform. Our cash margins will continue to increase as a higher oil production mix captures higher realized pricing on an equivalent unit basis. Last, but not least, our fourth objective is to delever the balance sheet through debt reduction and greater cash flows. Year to date, we have announced approximately $425 million in acquisition value while remaining on track to achieve a one times leverage ratio by the end of this year. Our leverage ratio for the second quarter was reflective of cash timing of closing the transactions, but we expect to quickly reduce our debt balance using free cash flow. Our debt balance at the end of July was $613 million a $31 million reduction since the end of June. Furthermore, our liquidity position at the end of July exceeded $300 million, providing Silver Bow the dry powder it needs to continue to pursue accretive opportunities. Looking beyond this year, our preliminary 2023 outlook calls for roughly $700 million of EBITDA and $250 million of free cash flow. This represents a significant amount of cash generation above and beyond the requirements to fund our growth and delivering objectives. Combined with our growth plans over the next 18 months, we see a compelling valuation based upon EBITDA, leverage, and cash flow yields. We continue to see the highest reinvestment opportunities through either the drill bit or accretive acquisitions. It will likely continue to be a combination of both given the pipeline of opportunities to further consolidate the Eagle Fern. With that, I will turn the call over to Steve to provide an operational update. Steve, please go ahead.