Michael Scialla • Stifel, Nicolaus & Company, Incorporated

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President and CEO Zach Arnold clarified that pulling a project forward does not change the overall capital need, as the drilling and completion costs per foot for gas and oil wells are nearly identical. He confirmed the company will maintain a one-rig, one-crew program for the rest of the year, with CapEx declining in Q4 as the effects of running two rigs earlier in the year subside. On rig efficiency, Arnold noted that while there are some gains from dedicated rigs, the time spent moving a rig between states is managed efficiently and is not a major drag on the overall schedule.

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President and CEO Zach Arnold explained the annual budget is unchanged because drilling costs per foot are nearly identical for gas and oil wells, so shifting the schedule doesn't alter total spend. He confirmed a one-rig program for the year and noted that while a two-rig program offers some efficiency, current rig mobilization between states is already highly efficient.

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President and CEO Zack Arnold stated that Infinity is active in M&A processes but can be patient due to its strong balance sheet. He clarified that Q1 land capex was for bolt-on activity and that the company would run one rig and one frac crew for the second half of the year after an active Q2 with two frac crews. He also noted that current well economics work well in today's service cost environment, with a focus on operational efficiency gains.

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President and CEO Zack Arnold stated that the company is very active in M&A processes but remains patient, using its strong balance sheet as an advantage. He characterized the land spending as typical for increasing working interests and lengthening laterals. Arnold clarified that the company dropped to one rig in Q2 but added a second frac crew, with plans to run one rig and one frac crew for the second half of the year, while continuing to seek operational efficiencies with service providers.

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CEO Zack Arnold detailed the recent well turn-in-lines from late 2024 and early 2025, noting that production growth will occur throughout the year based on their 6-7 month cycle times. CFO David Sproule added that growth may not be linear but will see jumps as pads come online. Regarding the Marcellus pad, Arnold expressed excitement about the strong early results, which are factored into guidance, but declined to provide specific production figures.

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CEO Zack Arnold detailed the recent well turn-in-lines, including six oil wells in late Q4 and six more wells (one oil, five gas) in early Q1 2025. He noted that with 6-7 month cycle times, production should ramp throughout the year as drilling programs conclude. While declining to give specific well performance, Arnold stated the company is very excited about the early results from the Marcellus pad, which are reflected in the full-year guidance.

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EVP & CFO Dana Armstrong stated that while financing for Hull 3407 is still being evaluated, the company is in a strong position with over $400 million in cash and an undrawn $500 million revolver, providing ample flexibility. EVP & COO David Liner confirmed there were no compromises on the Shenandoah purchase, stating they acquired the vessel in great condition immediately after its drydocking at a very good price.

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CCO Oliver Simpson noted that Vietnam's government is focused on LNG to address its trade deficit, creating momentum, but there were no definitive updates on moving the MOUs with Petrovietnam subsidiaries to binding agreements. CFO Dana Armstrong explained that while some Q1 EBITDA strength was due to cost timing, she reaffirmed the increased full-year guidance. She also confirmed the drydock schedule for the Exemplar in Q3 and the Explorer in Q4.

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CEO Steven Kobos expressed satisfaction with the buyback program's effectiveness but stated the primary focus for capital is on growth, though all tools for shareholder returns remain under consideration. CFO Dana Armstrong explained that Q4 gas sales were boosted by two optimization deals and a pull-forward of an Atlantic Basin deal. For 2025, she noted that over 90% of guided EBITDA comes from the core business, with the remainder largely from assumed LNG optimization.

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CFO Dana Armstrong confirmed that 2025 maintenance CapEx is expected to exceed 2024 levels, primarily due to two capitalized dry docks scheduled for the second half of the year. Regarding near-term growth, CEO Steven Kobos and CCO Oliver Simpson stated that while the newbuild and conversions are key long-term projects, the company is actively pursuing inorganic growth opportunities and is in a strong financial position to act on them.

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President and CEO Tyler Farquharson confirmed that a fourth rig in 2026 is definitely possible as new partners begin aggregating inventory. He noted that while the capital percentage for operated partners might increase, the company still sees substantial non-op opportunities, particularly in the Utica, and expects to maintain a healthy non-op component in its capital program.

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CFO Tyler Farquharson stated that Operated Partnerships are expected to comprise about a quarter of 2025 production and that the company continues to target a 25% rate of return. He confirmed they have scaled back from two rigs to one as a prudent measure. Regarding the Midland Basin, he noted that while the plan is to start development in the summer, it is a real-time conversation given market volatility and is one of the easiest projects to defer if necessary.

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Executive Luke Brandenberg confirmed the spending is market-driven, hinging on hydrocarbon pricing and the availability of non-dilutive financing. He noted this spend would significantly boost early 2026 production with negligible impact on 2025. Brandenberg also confirmed the two current rigs are in the Delaware Basin and that Granite Ridge hopes to begin drilling in the Northern Midland Basin around the middle of 2025.

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Executive Luke Brandenberg clarified that the Midland Basin currently holds 5-6 net locations, with the focus on building more inventory before deploying a rig, likely in late 2024 or early 2025. He confirmed the production look-back slide does not include timing risk; it strictly compares underwritten well performance against actual results to demonstrate the accuracy of their underwriting process.

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CEO Tom Ward confirmed the preliminary 2026 plan (3 rigs in San Juan, 2 in Anadarko, 1 in Oswego) is contingent on commodity prices and operating cash flow. He also noted that both Sabino and iCav have wells ready for completion post-closing. CFO Kevin White explained the GP&T cost increase was a reclassification due to a new marketing arrangement, which was neutral to the bottom line as revenues also increased.

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Executive Tom Ward specified that seven of the Q1 wells were Oswego and two were Woodford condensate. For the deep Anadarko, he stated the first well is currently drilling and they expect to recover 5 Bcf per section with rates of return exceeding 50%, noting the main risk is cost inflation, not geology. For 2026, Ward projected that with the added gas drilling, natural gas production would grow by over 20% while crude oil volumes would decline by less than 10%.

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CEO Tom Ward described the seller as a distressed individual from whom Mach acquired wells at a fair PDP PV10 value, inheriting proven undeveloped locations. CFO Kevin White clarified the per-unit distribution was lower because the total cash was shared with new equity holders from a February offering, and that after a required principal payment, all remaining cash was distributed.

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Executive Tom Ward detailed the complex factors involved in refinancing, including call premiums, covenants, and fees, stating a decision is forthcoming with a focus on eliminating the 2025 amortization. Regarding the Cherokee shale, he explained that capital would only be deployed after other operators further de-risk the play, as its returns do not yet compete with their Ardmore Basin locations.

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CEO John Christmann clarified that the Suriname budget change is a rephasing of payments and does not alter the overall project timeline for first oil in mid-2028 or the total cost. Regarding Alaska, Christmann and EVP of Exploration Tracey Henderson explained that following the successful Sockeye-2 discovery, the pause is necessary to reprocess and integrate multiple 3D seismic surveys. This work is critical for optimizing the appraisal of Sockeye and prioritizing future exploration targets across their large acreage position.

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President and CEO Paul Goodfellow emphasized the company's disciplined capital framework, which prioritizes maintaining balance sheet strength and optionality for accretive M&A opportunities. He stated the decision to extend the West Vela rig was driven by its outstanding performance and a favorable new rate, aligning with their strategy of executing high-value projects with top-tier partners.

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President and CEO Paul Goodfellow indicated the 2026 investment program is likely to be in line with current levels, with a funnel of projects being matured. He noted Talos is a liquid-rich company but will pursue robust low-breakeven projects regardless of commodity type. Regarding Zama, Goodfellow stated Talos is happy with its current partnership and will continue working toward a potential investment decision.

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Interim Co-President and CFO Sergio Maiworm clarified that the downtime is dispersed across several facilities, with the largest impacts from maintenance and tie-in activities at Prince, Tarantula, Brutus, and Pompano. He added that the Helm's Deep sell-down is still in progress and that the next exploration well slot could be Helm's Deep or another prospect pending commercial discussions.

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CEO & Director David Rockecharlie responded that the company's job is to continue demonstrating the business's strength through consistent free cash flow generation, strong returns, and operational excellence. Regarding the Uinta, he explained the pause is a prudent step to evaluate the excellent results in a less-developed area to ensure they maximize future value, not an indication of inferior returns compared to the Eagle Ford.

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Executive Brandi Kendall confirmed the shift was purely due to timing, with a couple of pads moving into Q2, and reaffirmed the full-year capital guide. CEO David Rockecharlie stated unequivocally that the activity floor is zero, highlighting that the business was intentionally built with a low decline rate and HBP acreage to provide the flexibility to halt activity when it makes financial sense.

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EVP & COO Clay Rynd stated that while the early delineation results represent pure upside to the location count, it is too early to quantify the increase. CEO David Rockecharlie outlined the path to an investment-grade rating as a two-part strategy: doubling the production scale of the business and simultaneously maintaining investment-grade credit metrics along the way.

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An executive, Clay, responded that while they evaluate both oil and gas opportunities, the bar for deals is high and the current A&D market is more active in oil. He noted the Central Eagle Ford asset is development-ready, will benefit from the same D&C savings as the broader business, and is expected to be developed starting in 2025.

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EVP & COO Beth McDonald explained that they have production data from all seven lower cube zones and are actively monitoring the upper cube. She clarified that the strong Q2 performance represented a shift of production forward in the year, not an increase in the total annual volume, hence the unchanged full-year guidance.

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COO Beth McDonald stated that 15-20% of Uinta crude is typically sold to Salt Lake City refineries to capture lower transportation costs, with the volume determined by refinery capacity. She also noted that non-operated activity is expected to continue at a similar rate and is not considered material enough to alter the full-year CapEx guidance.

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COO Beth McDonald clarified that the Q1 production dip was a temporary timing issue due to a 3-month gap in completions after dropping a frac crew, with production expected to grow through Q3. President and CEO Herbert Vogel added that while the Utah acquisition was a major contributor to inventory growth, the company is not providing a detailed breakdown and is not focused on or including its Eagle Ford dry gas assets in current inventory counts.

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CFO & President Alan Shepard stated that while long-term bullish, potential AI demand does not change their short-term hedging strategy, which remains focused on balance sheet management. CEO Nick DeIuliis emphasized the path to realizing this demand is uncertain, so the company's capital allocation playbook is unchanged. COO Navneet Behl attributed the Q2 production beat to strong new well performance, operational execution, base production efficiency, and high uptime.

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CFO Alan Shepard clarified that the 8,600 acres represent the specific Utica rights controlled at acquisition, not rights across the entire 36,000-acre footprint, and confirmed the initial wells are all Marcellus. COO Navneet Behl stated that Utica wells are performing as expected, in line with the 3 Bcf per 1,000 feet target, with Alan Shepard adding that capital efficiency goals are being met.

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CFO Alan Shepard confirmed no near-term constraints exist for a Utica ramp-up, with any decision being a function of price. COO Navneet Behl detailed significant cost reductions, with drilling costs down to ~$750/foot. Both executives affirmed the Utica play is highly prolific and competitive with Marcellus assets.

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CEO Francisco Leon outlined a clear path forward, stating that CRC will break ground on the project in the second quarter of 2025. The work will involve connecting its cryogenic plant to the injector well, with the goal of flowing CO2 and collecting the first CCS-related cash flow by the end of the year. He indicated the next public update would likely be the announcement that construction has commenced.

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Francisco Leon (Executive) confirmed CRC has over 850 MW of power generation statewide, using less than half for its own operations, and is evaluating the entire portfolio for decarbonization opportunities. At Elk Hills, he specified that about two-thirds of the 550 MW plant capacity is excess. While it currently serves the grid and resource adequacy programs, the strategic goal is to bring this power 'behind the meter' for a dedicated partner to optimize its value.

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An executive reiterated the $115 million total CapEx plan, with $27 million for Moser growth and the remainder split evenly between maintenance and growth for the legacy proppant and logistics business. The Moser capital is aimed at growing the megawatt base from 212 MW to 310 MW by the end of 2026. He highlighted that the overwhelmingly positive customer response to the acquisition is causing them to re-evaluate the business's ultimate growth potential.

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President and CEO Toby Rice stated that there are no deep Utica wells planned in Pennsylvania, as the Marcellus remains the best investment opportunity. CFO Jeremy Knop noted the deep Utica represents future upside but is not currently competitive. Regarding MVP, Rice explained it is expected to be a seasonal pipe until further downstream expansions are complete, but its recent high flows at premium prices demonstrate the critical need for the pipeline.

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Christopher Calvert, EVP and COO, explained that remote operations involve connecting two separate well pads with surface infrastructure, allowing a single frac fleet to complete them as one large, continuous job. This engineering solution turns pads that would not be candidates for these efficient completion techniques into ones that are, which has already generated upwards of $20 million in savings on over 90 wells.

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