Financial Data and Key Metrics Changes - In Q4 2025, Chord Energy reported adjusted free cash flow of $175 million, significantly exceeding expectations, with approximately 50% returned to shareholders [9] - Oil volumes exceeded original guidance by more than 1,000 barrels per day, while capital spending was approximately $60 million lower than expected [6][9] - The company achieved a $160 million improvement in free cash flow in 2025 from controllable items, representing 23% of estimated free cash flow in 2026 [7][9] Business Line Data and Key Metrics Changes - Chord has successfully lowered its capital spending by nearly $100 million since merging with Enerplus in 2024 while increasing oil production by 6,000 barrels per day [6] - The company achieved its goal of converting 80% of its inventory to long laterals by the end of 2025, which has significantly lowered the cost of supply [10][11] Market Data and Key Metrics Changes - Chord's operational improvements and shift to longer laterals have resulted in a 22% reduction in future finding and development costs over the past few years [12] - The company anticipates generating approximately $700 million of free cash flow in 2026 at benchmark prices of $64 per barrel of oil and $3.75 per MMBtu of natural gas [13] Company Strategy and Development Direction - Chord remains focused on disciplined capital allocation, strong returns on capital, and continuous improvement, with a commitment to delivering affordable and reliable energy sustainably [13] - The company has returned $6.7 billion of capital to shareholders since 2021, which is higher than its current market cap, while maintaining low leverage compared to peers [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience to commodity price cycles, indicating that significant changes to the long-term plan would only occur in response to drastically lower oil prices [16][17] - The company is optimistic about its ability to generate meaningful free cash flow and shareholder returns, supported by strong subsurface assets and a dedicated team [17] Other Important Information - Chord has a substantial, low decline, high oil cut production base, paired with a deep inventory of highly economic, conservatively spaced, oil-weighted locations [87] - The company is actively evaluating the use of surfactants in both new well completions and workover operations, having already pumped 19 chemical and surfactant treatments [36][38] Q&A Session Summary Question: Long-term plan consistency despite oil price fluctuations - Management indicated that the company has built a resilient organization capable of weathering commodity price cycles while still generating free cash flow and shareholder returns [16][17] Question: Fixed costs and breakeven costs - Management emphasized an organization-wide effort to drive down costs, including capital efficiency and operating expense improvements, contributing to lower breakeven costs [19][20] Question: Organic inventory improvements - Management noted improvements across the basin, with a focus on refining and improving inventory positions, leading to better returns on previously less viable drilling locations [24][25] Question: Water disposal optimization - Management confirmed that while water production is increasing, disposal capacity is adequate, and ongoing capital spend on water systems is aimed at enhancing E&P productivity [73][74] Question: Implications of longer laterals on infill drilling - Management acknowledged that longer laterals could have beneficial implications for infill drilling, allowing access to reserves that may not have been effectively drained [81][84]

Chord Energy Corporation (NASDAQ:CHRD) Q4 2024 Earnings Conference Call February 26, 2025 11:00 AM ET Company Participants Bob Bakanauskas - Vice President of Investor Relations Daniel Brown - President and Chief Executive Officer Darrin Henke - Executive Vice President and Chief Operating Officer Richard Robuck - Executive Vice President and Chief Financial Officer Michael Lou - Executive Vice President, Chief Strategy Officer and Chief Commercial Officer Conference Call Participants Scott Hanold - RBC Cap ...