APA (APA) Q1 2025 Earnings Call May 08, 2025 11:00 AM ET Speaker0 thank you for standing by. Welcome to the APA Corporation's First Quarter twenty twenty five Results Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Ben Rogers, Senior Vice President of Finance and Treasur ...

Core Insights - Cygnus Metals Limited has reported significant high-grade gold mineralization at the Golden Eye prospect within the Chibougamau Copper-Gold Project in Quebec, with the best intercepts to date being 60.8g/t AuEq over 0.4m, including 51.3g/t Au, 7.2% Cu, and 18.0g/t Ag [1][6][13] - The results indicate the potential for valuable resource growth, with additional assay results expected soon from ongoing drilling [5][9][10] Drilling Results - Recent drilling results include: - 7.4m @ 5.7g/t AuEq (4.6g/t Au, 0.9% Cu, 5.6g/t Ag) from 405.6m, with a notable interval of 3.1m @ 9.6g/t AuEq [6][13] - 2.9m @ 10.2g/t AuEq (8.3g/t Au, 1.4% Cu, 3.3g/t Ag) from 463.8m, including the high-grade 0.4m @ 60.8g/t AuEq [6][13] - Historical drilling has shown significant intersections, such as 5.9m @ 34.1g/t AuEq and 4.5m @ 21.6g/t AuEq, indicating a strong potential for resource estimation [7][14] Project Development - The Golden Eye prospect is strategically located 3km from Cygnus' central processing plant, with existing dual ramp access within 150m of the mineralization [8][10] - Cygnus plans to compile new drilling results with historical data from 77 holes totaling 21,371m to complete an initial Mineral Resource Estimate for Golden Eye [10][15] Historical Context - The Chibougamau district has a rich history of gold and copper production, with over 3.5 million ounces of gold produced historically at an average grade of 2.1g/t Au [11][12] - Golden Eye has never been mined and was last drilled in the early 1990s when gold prices were significantly lower [6][10] Future Outlook - Cygnus aims to leverage ongoing exploration and data compilation to identify additional drill targets and enhance resource growth, focusing on low-risk brownfield exploration [15][12] - The company is positioned to benefit from historically high gold prices, making Golden Eye a potential growth driver [8][9]

Financial Data and Key Metrics Changes - In Q1 2025, Comstock Resources reported natural gas and oil sales of $405 million, a 21% increase compared to the previous year [9][11] - Adjusted EBITDAX for the quarter was $293 million, with adjusted net income of $53.8 million or $0.18 per diluted share, a significant recovery from a loss in Q1 2024 [10][11] - Production averaged 1.28 Bcfe per day, reflecting a 17% decrease from Q1 2024 due to a reduction in rig count and deferred completion activities [10][11] Business Line Data and Key Metrics Changes - The company turned 14 wells to sales since the last update, with an average initial production rate of 25 million cubic feet per day [10] - The Elijah One well, turned to sales with an initial production rate of 41 million cubic feet per day, marks a significant step in delineating the Western Haynesville play [8][26] Market Data and Key Metrics Changes - The average NYMEX settlement price for natural gas was $3.65, while the average Henry Hub spot price was $4.27, with realized gas prices at $3.58 [11][12] - The company was 54% hedged, which impacted the realized gas price, resulting in a loss of $16 million on third-party gas marketing due to market volatility [12][13] Company Strategy and Development Direction - Comstock is focused on building its assets in the Western Haynesville to capitalize on the growing demand for natural gas, with plans to drill 20 wells and turn 15 to sales in 2025 [42][43] - The company aims to develop its own midstream assets to capture more value from its Western Haynesville operations [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term growth in natural gas demand, particularly for power generation and LNG feedstock [7][42] - The company anticipates improved leverage ratios and financial performance due to higher natural gas prices and a strong hedge position [16][44] Other Important Information - Comstock has invested over $1 billion in developing its 520,000 net acres in the Western Haynesville [7] - The company reported a greenhouse gas intensity improvement of 28% and a methane emission intensity rate improvement of 2.5% compared to 2023 [38][39] Q&A Session Summary Question: Can you discuss the reservoir quality of the Elijuan well compared to previous wells? - Management indicated that the reservoir quality of the Elijuan well appears as good as those in the core area, with good thickness and geological support for the drilling decision [50][51] Question: What is the structure and value of the BKV partnership? - The partnership aims to develop carbon capture projects, enhancing the attractiveness of the location for potential power generation facilities [59][60] Question: When can we expect another result in the Western Haynesville area? - The next well is planned to be spud in Q4 2025, with further drilling contingent on midstream infrastructure development [66] Question: How many rigs can the Western Haynesville support in the future? - Management believes that with the right conditions, the area could support 15 to 20 new wells annually, focusing on prudent development [94][95]

Financial Data and Key Metrics Changes - In Q1 2025, natural gas and oil sales increased to $405 million, a 21% increase compared to the previous year [8][11] - Operating cash flow was $239 million, or $0.81 per diluted share [8] - Adjusted EBITDAX for the quarter was $293 million, with adjusted net income reported at $53.8 million, or $0.18 per diluted share [9][11] - Production averaged 1.28 Bcfe per day, reflecting a 17% decrease from Q1 2024 due to reduced rig activity [10] Business Line Data and Key Metrics Changes - The company turned 14 wells to sales since the last update, with an average initial production rate of 25 million cubic feet per day [9] - The Elijah One well, turned to sales with an initial production rate of 41 million cubic feet per day, represents a significant step in delineating the Western Haynesville [7][25] Market Data and Key Metrics Changes - The average NYMEX settlement price for natural gas was $3.65, while the average Henry Hub spot price was $4.27 [11] - Realized gas price in Q1 was $3.58, reflecting a $0.07 differential from the NYMEX price [12] Company Strategy and Development Direction - The company is focused on building assets in the Western Haynesville to capitalize on growing natural gas demand [40] - Plans to drill 20 wells and turn 15 wells to sales in the Western Haynesville in 2025, while also maintaining production in the legacy Haynesville [41] - The partnership with BKV Corporation aims to develop carbon capture projects, enhancing the company's low-carbon footprint strategy [39][56] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term growth in natural gas demand, particularly for power generation and AI applications [6][40] - The company anticipates improved leverage ratios and financial performance due to higher natural gas prices and a strong hedge position [15] Other Important Information - The company has invested over $1 billion in developing the 520,000 net acres in the Western Haynesville [6] - The company reported a greenhouse gas intensity improvement of 28% compared to 2023, with significant reductions in CO2 and methane emissions [36][38] Q&A Session Summary Question: Can you discuss the reservoir quality of the Elajawan well compared to previous wells? - Management indicated that the reservoir quality of the Elajawan well appears as good as those drilled in the core area, with good thickness and geological support [48][51] Question: What is the structure and value of the BKV partnership? - The partnership aims to develop carbon capture projects, enhancing the attractiveness of the company's gas resources for potential power generation facilities [56][60] Question: When can we expect more results from the Western Haynesville area? - The next well is planned to be spud in Q4 2025, with additional wells planned for 2026 [63][65] Question: How many rigs can the Western Haynesville support in the future? - Management indicated that they will prudently develop the area, ensuring they do not oversupply the market while meeting increasing demand [90][92] Question: What is the capital allocation strategy for 2026? - The focus will remain on drilling wells to hold acreage while balancing the need for delineation and appraisal wells [102]

Financial Data and Key Metrics Changes - Transocean reported an adjusted EBITDA of $244 million on contract drilling revenues of $906 million, resulting in an adjusted EBITDA margin of approximately 27% [9][23] - The company experienced a net loss attributable to controlling interest of $79 million, equating to a net loss of $0.11 per diluted share [23] - Cash flow from operating activities was $26 million, while free cash flow was negative $34 million due to $60 million in capital expenditures [23][24] - Total liquidity at the end of the first quarter was approximately $1.3 billion, including $263 million in unrestricted cash [25] Business Line Data and Key Metrics Changes - Contract drilling revenues exceeded guidance primarily due to higher utilization on the Transocean Spitzbergen and Transocean Endurance [23] - Average daily revenue was approximately $444,000, with operating and maintenance expenses at $618 million, which was within guidance [23][24] Market Data and Key Metrics Changes - The U.S. Gulf is expected to see up to six programs commence in the second and third quarters of 2026, with three expected to come from public tenders [15] - In Brazil, Petrobras is increasing its rig count and has released tenders for upcoming projects, indicating a strong market outlook [16] - The company anticipates growth in West Africa, with multi-year opportunities expected to arise in 2026 [60] Company Strategy and Development Direction - Transocean is focused on converting its $7.9 billion backlog into revenue and cash to create sustainable value for shareholders [22] - The company is committed to delivering safe, reliable, and efficient operations while optimizing performance and maximizing shareholder returns [6][22] - Management emphasized the importance of deepwater drilling and the strategic shift among European majors towards oil and gas investments [11][14] Management Comments on Operating Environment and Future Outlook - Management noted that market volatility has not materially impacted business operations, with no planned programs delayed or canceled [13] - The outlook for deepwater drilling remains positive, with projections indicating a 40% increase in deepwater investment by 2029 [14][86] - Management expressed confidence in the future of offshore drilling, citing strong fundamentals and increasing offshore drilling activity [21][88] Other Important Information - The company has identified approximately $100 million in cash cost savings for 2025, with a similar amount expected for 2026 [34][70] - There are no significant costs associated with achieving these savings, which primarily come from renegotiating contracts and utilizing local crews [72] Q&A Session Summary Question: Timing of contract announcements - Management expects several contract announcements throughout the year, particularly in the second half, with a focus on long-term awards [44] Question: Day rates for upcoming contracts - There may be near-term pressure on day rates for short-term work, but long-term contracts are expected to remain stable [46][47] Question: Implications of Shell awards from Noble - Management believes there are still opportunities with Shell, as they anticipate additional demand in the Gulf of Mexico [54] Question: Activity assumptions for West Africa - Management sees potential growth in West Africa, with expectations for multi-year opportunities starting in 2026 [60] Question: Cost savings details - Management confirmed $100 million in identified savings for 2025, with a similar expectation for 2026, primarily from operational efficiencies [70] Question: Status of idle and cold stacked vessels - The company is actively looking for opportunities for its idle vessels and continues to assess its cold stacked fleet [76][78]

Transocean (RIG) Q1 2025 Earnings Call April 29, 2025 10:00 AM ET Company Participants Alison Johnson - Director-Investor RelationsJeremy Thigpen - CEO & Executive DirectorKeelan Adamson - President and Chief Operating OfficerThaddeus Vayda - EVP & CFOEddie Kim - Vice President - Equity ResearchRoddie Mackenzie - Executive VP & Chief Commercial OfficerArun Jayaram - Vice PresidentFredrik Stene - Head of ResearchNoel Parks - Managing Director - Energy Research Operator Good day, everyone, and welcome to the ...

NOV Inc. (NOV) reported first-quarter 2025 adjusted earnings of 19 cents per share, which missed the Zacks Consensus Estimate of 25 cents. The bottom line decreased from the year-ago quarter’s 30 cents. This underperformance can be attributed to margin pressures on projects within its Energy Equipment segment. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) The oil and gas equipment and services company’s total revenues of $2.1 billion marginally beat the Zacks Consensus Estimate b ...

Financial Data and Key Metrics Changes - The company reported a stabilization in production, achieving approximately 950 barrels of oil per day, with expectations to increase this by 50% by the end of the year [12][19] - Lease operating expenses (LOE) were reduced from over $800,000 per month to an average of $765,000 in 2024, with a target of around $700,000 per month for 2025 [65][66] - The company is hedged at 70% or greater at $70 per barrel through 2025, which provides some stability against market fluctuations [30][84] Business Line Data and Key Metrics Changes - The company is focusing on the Seven Rivers waterflood project, with plans to develop 250 patterns, each expected to produce 20 barrels of oil per day [19][20] - The horizontal drilling potential in the San Andres formation has been identified, with 50 wells expected to yield 300 to 500 barrels of oil per day [16][36] Market Data and Key Metrics Changes - The company is navigating volatility in oil pricing and tariffs that impact oil prices, which is a concern for the overall market [7][78] - The management expressed optimism about the oil market, suggesting that any reduction in oil prices may be short-lived due to the social costs faced by oil-producing countries [84] Company Strategy and Development Direction - The company plans to acquire a 10% royalty from the seller for approximately $15 million, which is expected to be accretive to shareholders [11][72] - Future strategies include cutting general and administrative expenses and lease operating expenses to improve profitability [21][74] - The company aims to make at least one acquisition in the year, focusing on Permian properties and gas opportunities [22][72] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges faced in 2024 but emphasized the importance of infrastructure repairs and upgrades for future profitability [20][25] - The company expects a significant improvement in 2025, with plans to increase production and reduce costs [19][21] - Management is optimistic about the potential for horizontal drilling and workovers, indicating a bright future for the company [90][91] Other Important Information - The company has made significant strides in cleaning up its balance sheet, including settling liabilities and reducing debt [43][45] - The management team is committed to a balanced approach to funding, avoiding excessive equity dilution and debt [48][51] Q&A Session Summary Question: What are your largest concerns that might negatively impact your plans? - The largest concern is market volatility, particularly oil prices and tariffs [78] Question: What are your plans regarding future use of stock in lieu of cash for accounts payable and other liabilities? - The company plans to use stock sparingly for settling debts related to acquisitions and services [80] Question: Are you still working on the workover wells, or is this less of a priority compared to Seven Rivers? - Workovers are a top priority and are tied to the development of the Seven Rivers project [87] Question: What are you doing to negotiate and benchmark parts, pumps, and other goods necessary for productivity savings? - The company conducts thorough bidding processes to ensure the best value for parts and services [95] Question: If oil prices recover to $85 to $90 per barrel, would you increase production faster? - The company would accelerate workovers and drilling if funding allows, but will proceed cautiously [102] Question: Is the $52.8 million revenue sharing of volumetric funding arrangement with Enstream Capital still on track for June 2025 closing? - The lender has indicated that the deal is still on track, but the company remains cautious [106][109] Question: What is your relationship with drilling permits in New Mexico? - The regulatory environment has improved, potentially reducing the permit process from eight to six months [115]

Financial Data and Key Metrics Changes - For the full year 2024, the company delivered $378 million of adjusted EBITDA on $1.4 billion of revenue, with capital expenditures of $118 million [38][39] - The fourth-quarter total operating revenues were $289 million, primarily impacted by fewer operating days due to planned out-of-service time and cold stacking of rigs [40] - The company maintained a strong balance sheet with gross principal debt of $625 million and cash of $505 million, resulting in a net debt position of $120 million [42] Business Line Data and Key Metrics Changes - The company returned over $500 million in capital to shareholders and had a contracted backlog of $1.3 billion, with $400 million from divesting non-core assets [8][9] - The share repurchase program returned a total of $792 million to shareholders, reducing the issued share count by 22% since September 2023 [9][44] - The company secured approximately 65% of the global backlog awarded to the four largest publicly traded offshore drillers, despite representing only 18% of the drillship fleet [27] Market Data and Key Metrics Changes - The drillship marketed utilization is now in the mid-eighties, down from the high nineties in 2023, indicating a softening market [32] - The company expects future demand to increase, but visibility remains unclear, with a strong balance sheet and 75% of the marketed fleet contracted for 2025 [12][32] - The company reported $3 billion in durable contract cover extending through 2028 and into 2029 [13] Company Strategy and Development Direction - The company aims to be a pure-play floater company, having executed a strategy to rationalize its fleet and divest non-core assets [49][50] - The focus remains on delivering safe and efficient operations while optimizing the cost base to navigate market volatility [25][138] - The company is committed to improving safety performance and maintaining a low-cost operating model [137][140] Management's Comments on Operating Environment and Future Outlook - Management noted that the immediate outlook for 2025 is uncertain, but they expect a rapid improvement in 2026 as deferred demand intersects with major projects [66] - The company is optimistic about the exploration activities, with around 30% of rigs currently drilling exploration wells, indicating a shift in market dynamics [65][131] - Management is actively engaged in discussions with clients to navigate new regulatory expectations and minimize potential non-revenue days [55][90] Other Important Information - The company is facing legal challenges from Petrobras, with claims amounting to approximately $213 million related to delayed penalties from contracts dating back to 2012 [22][21] - The company intends to vigorously defend its position and is evaluating all options, including potential counterclaims against Petrobras [23][24] Q&A Session Summary Question: Downtime for the Telus rig - Management confirmed 50 days of downtime due to a protracted regulatory clearance process, not due to changes in rules [54][55] Question: Petrobras litigation context - Management acknowledged the surprise regarding the $213 million claim and noted that penalties are capped at 10% of contract value [57][58] Question: Client conversations and project economics - Management indicated a mix of client responses, with some being cautious while others are ready to return to the market as day rates improve [62][68] Question: Operating expenses and guidance - Management provided insights on expected operating expenses, estimating $150k per day across the drillship fleet, excluding SG&A [75][76] Question: Share buyback program amid uncertainty - Management emphasized the importance of cash conservation while recognizing the attractiveness of current share prices for buybacks [110][111] Question: Exploration activities and client strategies - Management noted an increase in exploration activities and a growing demand for drilling in 2026 and beyond [126][131]