Josef Schachter

Josef Schachter of Schachter Energy Research Services Inc. requested a timeline for achieving the upside production potential in Ecuador and asked for insight into the factors that could push production to the low or high end of the company's guidance range.

Answer

CEO Gary Guidry projected a 2-to-3-year timeline to reach plateau production in Ecuador, with the pace being dictated by oil price volatility. He identified global commodity prices as the primary variable influencing the guidance range. COO Sebastien Morin added that existing environmental licenses provide the necessary flexibility for this development.

Josef Schachter from Schachter Energy Research Services Inc. asked for the timeline and well count required to achieve the upside production potential in Ecuador. He also requested clarity on the scenarios that would lead to the low or high end of the full-year production guidance, given the strong start to the year.

Answer

President and CEO Gary Guidry projected a 2-to-3-year timeline to reach plateau production in Ecuador, with the pace dictated by oil price volatility. He identified commodity prices, especially for natural gas, as the primary variable influencing the guidance range. COO Sebastien Morin added that existing environmental licenses provide the necessary flexibility for this development.

Josef Schachter of SERSI questioned the timeline for achieving the upside production potential in Ecuador and asked for details on the scenarios that could lead production to the high or low end of the full-year guidance range.

Answer

President and CEO Gary Guidry projected a 2-to-3-year timeline to reach plateau production in Ecuador, with the pace dependent on oil prices. He also identified commodity prices, particularly for natural gas, as the main variable that will influence where production lands within the guidance range, noting the company will adjust its capital program accordingly.

Josef Schachter asked about the allocation of free cash flow between debt reduction and share buybacks, the political outlook in Ecuador, the potential for the 2025 program to stabilize Colombian production, and what actions could be taken to address the stock's valuation discount.

Answer

EVP and CFO Ryan Ellson stated that excess free cash flow would be split 50/50 between debt reduction and share repurchases. President and CEO Gary Guidry expressed confidence in a continued business-friendly government in Ecuador. COO Sebastien Morin affirmed he is comfortable that the 2025 program can maintain Colombian production levels. Finally, Gary Guidry reiterated that continuing to buy back shares is the primary tool to address the stock's discount to NAV.