Financial Data and Key Metrics Changes - The company reported a net loss of $57 million in Q4 2024, primarily due to net derivative losses of $58 million, resulting in a negative $0.68 per diluted share [46] - Adjusted net income for Q4 2024 was approximately $1 million, or a positive $0.01 per diluted share, after adjusting for unrealized derivative losses and other non-recurring items [47] - For the full year 2024, the company generated positive adjusted free cash flow of $92 million, with an overall adjusted free cash flow margin of 15% [45] Business Line Data and Key Metrics Changes - The upstream business produced 774 million cubic feet equivalent per day in Q4 2024, exceeding the midpoint of guidance by 5% [20] - The average annual daily production for 2024 was 788 million cubic feet equivalent per day [22] - The Power JV's implied share of net loss during Q4 was about $17 million, with adjusted EBITDA of $0.5 million [38] Market Data and Key Metrics Changes - The average capacity factor for the Temple plants during Q4 was 38%, with total generation of 1,200 gigawatt hours [37] - Power prices averaged $36.90 per megawatt hour in Q4, with average natural gas costs of $2.50 per MMBtu, resulting in an average spark spread of $19.37 per megawatt hour [37] - ERCOT's long-term load forecast estimates overall demand could reach 150 gigawatts by 2030, nearly doubling the 2023 peak load of 85 gigawatts [10] Company Strategy and Development Direction - The company aims to redefine the concept of an energy company by combining traditional and new energy approaches, focusing on integrated energy solutions [8] - The Power business is expected to grow through increased utilization of existing assets and potential M&A opportunities [12] - The company is actively pursuing additional combined cycle units to address projected demand growth and baseload supply mismatch [13] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the long-term demand growth in ERCOT, despite short-term price moderation due to benign weather and renewable additions [11] - The company remains committed to capital discipline and systematic investment in response to market conditions [41] - Management highlighted the importance of carbon capture in decarbonizing the global economy and expressed confidence in the CCUS business growth [14][16] Other Important Information - The company plans to increase total capital expenditures for 2025 to between $320 million and $380 million, with approximately $220 million allocated for development [43] - The company is in exclusive negotiations with a global energy transition investor for a joint venture in the carbon capture business, with a timeline to finalize agreements within 90 to 120 days [16] Q&A Session Summary Question: How much capacity would the company be comfortable dedicating to a PPA? - Management indicated that they would be comfortable dedicating up to 750 megawatts of capacity for a PPA, maintaining redundancy for maintenance [59] Question: What is the latest on discussions regarding PPAs and new plants? - Management confirmed active discussions for existing plants and is also exploring agreements for new plants, indicating a strong market position [61] Question: What is the expected CCUS capital spending? - Approximately $90 million of the $130 million guidance for CCUS and other is expected to be spent on CCUS projects, with no assumption of a joint venture at this time [69][71] Question: What is the outlook for production taxes? - Management clarified that lower production taxes were due to timing impacts related to ad valorem taxes, which are expected to normalize [75][77] Question: What factors drove the strong upstream performance? - The strong performance was attributed to new well development exceeding forecasts and effective base decline management [105] Question: What is the company's strategy regarding potential joint ventures for carbon capture? - Management expressed optimism about securing a joint venture partner, emphasizing bipartisan support for carbon capture initiatives [115]

Financial Data and Key Metrics Changes - The company reported a net loss of $57 million in Q4 2024, translating to a negative $0.68 per diluted share, primarily due to net derivative losses of $58 million [31] - Adjusted net income for Q4 2024 was approximately $1 million, or a positive $0.01 per diluted share, after adjusting for unrealized derivative losses and other non-recurring items [31] - For the full year 2024, the company generated positive adjusted free cash flow of $92 million, with an overall adjusted free cash flow margin of 15% [30][31] - The company anticipates total capital expenditures for 2025 to be between $320 million and $380 million, with approximately $220 million allocated for development and $130 million for CCUS and other [29] Business Line Data and Key Metrics Changes - The upstream business produced 774 million cubic feet equivalent per day in Q4 2024, exceeding the midpoint of guidance by 5% [15] - The average annual daily production for 2024 was 788 million cubic feet equivalent per day, showcasing strong performance and effective base decline management [17] - The Power JV's average capacity factor during Q4 was 38%, with total generation of 1,200 gigawatt hours [25] - The Power JV is targeting a gross 2025 adjusted EBITDA range of $130 million to $170 million, reflecting the impact of additional renewable generation and lower forward pricing [27] Market Data and Key Metrics Changes - ERCOT's long-term load forecast estimates overall demand could reach 150 gigawatts by 2030, nearly doubling the 2023 peak load of 85 gigawatts, with data center developments accounting for approximately half of this growth [8] - Power prices in Q4 averaged $36.9 per megawatt hour, with average natural gas costs of $2.5 per MMBtu, resulting in an average spark spread of $19.37 per megawatt hour [26] Company Strategy and Development Direction - The company aims to redefine the concept of an energy company by combining traditional and new energy approaches to offer integrated energy solutions [6] - BKV is actively engaging in M&A markets and expects significant opportunities for transactions in the next few years [9] - The company is exploring building additional combined cycle units to address the projected mismatch between structural demand growth and baseload supply [9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about long-term demand growth in ERCOT, anticipating that demand growth will outpace supply additions, particularly baseload supply [9] - The company remains committed to capital discipline and systematic CapEx investment, focusing on free cash flow [29] - Management highlighted the strong bipartisan support for carbon capture initiatives, which is expected to drive growth in this sector [11] Other Important Information - The company made its debut on the New York Stock Exchange in September 2024, marking a significant milestone [6] - The CFO announced his retirement, expressing confidence in the company's future leadership and direction [24] Q&A Session Summary Question: How much capacity would the company be comfortable dedicating to a PPA? - Management indicated that they would be comfortable dedicating up to 750 megawatts of capacity to a PPA, allowing for maintenance redundancy [38] Question: What is the latest on discussions regarding PPAs and new plants? - Management confirmed active discussions regarding existing power plants and is also exploring agreements for new plants, indicating a strong market position [41][44] Question: What is the expected capital spending for CCS? - Management clarified that approximately $90 million of the $130 million guidance for CCUS and other is expected to be allocated for CCUS spending [48] Question: How does the company view the current gas prices and upstream activity? - Management stated that they remain committed to a disciplined CapEx investment approach and will reassess their investment strategy based on market conditions in the second half of 2025 [54][56] Question: What are the margin economics of the new CCS contract? - Management indicated that the margin from the new CCS contract is comparable to previous projects, around $50 per ton EBITDA margin [61] Question: Will the company look outside ERCOT for new facilities? - Management confirmed that they are actively looking outside ERCOT for new opportunities, emphasizing the scalability of their business model [103]

National Fuel Gas Company (NFG) Q1 2025 Earnings Call January 30, 2025 09:00 AM ET Company Participants Natalie Fischer - Director of Investor RelationsDavid Bauer - President & CEOTimothy Silverstein - Principal Financial Officer & TreasurerJustin Loweth - President of Seneca ResourcesNoah Hungness - AssociateTimothy Winter - Portfolio Manager Conference Call Participants Greta Drefke - Equity Research Analyst Operator Hello, and welcome to the National Fuel Gas Company Q1 Fiscal 2025 Earnings Conference C ...