ARC Resources Ltd.

Good morning. My name is Lara and I will be your conference operator today. At this time, I would like to welcome everyone to the AHRQ Resources first quarter 2023 earnings conference call. 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 then the number one on your telephone keypad. If you would like to withdraw your question, Please press star followed by the number two. Thank you. Mr. Luko, you may begin your conference.

Thank you, operator. Good morning, everyone, and thank you for joining us on our first quarter earnings conference call. Joining me today are Terry Anderson, President and Chief Executive Officer, Chris Bibby, Chief Financial Officer, Armin Jahangiri, Chief Operating Officer, Lara Conrad, Chief Development Officer, and Ryan Barrett, Senior Vice President, Marketing. Before I turn it over to Terry and Chris to take you through our first quarter results, I'll remind everyone that this conference call includes forward-looking statements and non-GAAP and other financial measures with the associated risks outlined in the earnings release and our MD&A. All dollar amounts discussed today are in Canadian dollars unless otherwise stated. Finally, the press release, financial statements, and MD&A are available on our website as well as CDAR. Following our prepared remarks, we'll open the line to questions. With that, I'll turn it over to our president and CEO, Terry Anderson. Terry, please go ahead.

Thanks, Dale, and good morning, everyone. We'll get into the details of the Q1 performance here shortly, but before we do, I'd like to begin with Attachee. This is an exciting day for AHRQ and one that we've been looking forward to for quite some time. We've officially sanctioned the first phase of Attachee development. This is an important milestone which triggers the next stage of profitable growth for our company and for our shareholders. Anyone who has been following ARC understands that Hitachi is a flagship development for us. So let me remind you why. First, asset quality. Hitachi is a world-class, condensate-rich natural gas play in the heart of the Montigny. It has all the characteristics of a high-quality asset, a deep, over-pressured reservoir with scale and economics that competes with the best plays in North America. Second, scale. Over the past decade, ARC has accumulated 300 net contiguous sections at Hitachi with approximately 9 billion barrels of liquids and over 30 TCF of gas in place. To date, we have identified more than 1,500 drilling locations, more than 95% of which are unbooked, which can support at least four similar-sized phases to what we are advancing with Phase 1. With these attributes, Atachi has the scale to replicate CAQA in terms of production and profitability. And third, strong economics. Atachi is one of our highest return investment opportunities in our portfolio. We are investing approximately $740 million for Phase 1, which at today's forward curve will generate about $300 million of free cash flow annually. Project execution is one of ARC's greatest strengths, and over the past several years, our technical teams have narrowed in on the optimal development plan, which includes the adoption of some best practices from CAQA. ATACHI is set up to be our most efficient project to date. So with today's announcement, we are starting work immediately on the first phase of this development. Phase one production is approximately 40,000 BUE per day, which will come on stream in 2024, late 2024, and achieve full production in early 2025. Our team has done an excellent job in planning and preparing for today, which has been instrumental in mitigating risks to both project costs and schedule. We are on track for an 18-month construction time. Long lead items have been secured, and we have the development plan in place to achieve it. We are ready to proceed from a subsurface, surface, and commercial perspective. The design for the 90 million cubic feet a day gas processing facility is complete, and all major infrastructure, including the 25,000 barrels per day of liquids handling, is ready to construct. In addition, takeaway capacity has been secured for both phase one and for future phases. ATACHI will also be one of the most responsibly developed projects of its kind. Consistent with our other assets in Northeast BC, we plan to electrify the project, which will result in a low emissions profile. The facilities plan also includes water recycling infrastructure that will substantially reduce overall freshwater usage. As it relates to permitting, we have confidence there is a clear path forward following the recent agreements between the BC government and the Treaty 8 First Nations. This has allowed us to carefully plan and prepare for project execution. Over the past five years, we have worked closely with the Treaty 8 First Nations, and over that time, we have evolved our development plan to ensure the community's needs and priorities are met. Moving forward, we'll continue to collaborate with the communities neighboring our projects to ensure our development practices demonstrate our commitment to responsible development, balance economic prosperity, and honor treaty rights. Now, I'd like to touch on some notable items related to our strong Q1 performance. First, the combination of higher production with less capital is having positive implications on free cash flow. Capital spending is trending below expectations, and production was ahead of our forecast despite some third-party downtime in the quarter. This was due to better performance from our base assets, resulting in an upward revision to annual production guidance. Above all else, we delivered strong results safely. My team hears this at length. Safety is truly our number one priority. In an industry where capital preservation and discipline is under the microscope of investors, it is critical that we never waver on our commitment to safety. Not only does it ensure our employees go home safely, but it forms our culture, allows us to attract top talent, and strengthens relationships with our suppliers and counterparties. Thank you very much to our team for consistently delivering on this safety commitment. Continuing on our strategy to sustainably increase our dividend, we also announced a 13% dividend increase, our fifth increase over the past two years. The combination of better profitability and lower share count are the primary factors. This will continue and only accelerate with the commencement of Attachee. We also advanced our goal to further diversify our end markets with the announcement of our third natural gas supply agreement to Cedar LNG. We announced a non-binding MOU to supply 200 million cubic feet a day of natural gas to the project for 20 years ahead. commencing around 2027. We are very pleased with the relationship with Cedar and the progress we've made to date as we work towards definitive agreements. With that, I'll turn it over to Chris to walk through the details on the quarter and positive changes to our go-forward plan.