Denbury Resources Inc. (NYSE:DNR) Q4 2015 Earnings Conference Call - Final Transcript

Feb 18, 2016 • 11:00 am ET


Denbury Resources Inc. (NYSE:DNR) Q4 2015 Earnings Conference Call - Final Transcript


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Ladies and gentlemen, thank you for standing by. And welcome to the Denbury Onshore Fourth Quarter 2015 Earnings Release. At this time, phone lines are in a listen-only mode. Later, we will have a question-and-answer session. Instructions will be given at that time. [Operator Instructions] As a reminder, today's conference call is being recorded. And at this time, I'll turn the call over to Manager of Investor Relations, Ross Campbell. Please go ahead.

Ross M. Campbell

Thank you, Nick, and good morning, everyone. Thank you for joining us today. With me on the call from Denbury Resources are Phil Rykhoek, our Chief Executive Officer; Mark Allen, our Chief Financial Officer; and Chris Kendall, our Chief Operating Officer. Before we begin, I would like to let you know that we have slides, which will accompany today's discussion. For those of you that are not accessing the call via the webcast, these slides may be found at homepage by clicking on the Quarterly Earnings Center link beneath resources.

I would like to bring your attention on today's call that we will be including forward-looking statements that are based on the best and most reasonable information we have today. There are numerous factors that could cause actual events to differ materially from what is discussed on today's call. You can read our full disclosure on forward-looking statements and the risk factors associated with our business in this presentation, our most recent SEC filings and today's news release, all of which are posted to our website at

Also, please note that during the course of today's call, we will reference certain non-GAAP measures. Reconciliation and disclosures relative to these measures are provided on today's news release as well as on our website. With that, I'll turn the call over to Phil.

Philip M. Rykhoek

Thank you, Ross. Good morning, everyone, and welcome to our fourth quarter year-end call. These are obviously tough times for everybody as the low commodity prices have substantially lowered cash flow and therefore put a significant priority on the preservation of cash and liquidity. I believe if you examine the facts, you'll find we've taken several proactive and leading steps in response to this downturn. And in addition, we have many inherent advantages over our peers, because of our asset base and our capital structure.

Let me highlight some of those for you. One, we have taken and we'll continue to take steps to lower our cost in all categories of our business. This is evidenced by our eighth consecutive quarterly reduction in lease operating expenses per BOE; a 30% reduction in Q4 cash, general and administrative costs year-over-year, 4% reduction on an annual basis; and by the ongoing efficiencies in our capital spending program. While we are benefiting from vendor discounts and reductions, most of our savings is attributable to the hard work of our team, and these savings will remain in place after oil prices improve and vendor rates return to normal.

For example, our team has significantly reduced the CO2 required to