Oasis Petroleum Inc. (NYSE:OAS) Q2 2018 Earnings Conference Call - Final Transcript

Aug 07, 2018 • 11:00 am ET

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Oasis Petroleum Inc. (NYSE:OAS) Q2 2018 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good morning. My name is Keith and I will be your conference operator today. At this time, I'd like to welcome everyone to the Second Quarter 2018 Earnings Release and Operations Update for Oasis Petroleum. [Operator Instructions]

I would now turn the call over to Michael Lou, Oasis Petroleum CFO, to begin the conference. Thank you. You may now begin your conference.

Executive
Michael Lou

Thank you, Keith. Good morning, everyone. Today, we are reporting our second quarter 2018 financial and operational results. We're delighted to have you on our call. I'm joined today by Tommy Nusz and Taylor Reid as well as other members of the team. Please be advised that our remarks on both Oasis Petroleum and Oasis Midstream Partners, including the answers to your questions, include statements that we believe to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks and uncertainties, that could cause actual results to be materially different from those currently disclosed in our earnings releases and conference calls.

Those risks include, among others, matters that we have described in our earnings releases as well as in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K and our quarterly reports on Form 10-Q. We disclaim any obligation to update these forward-looking statements.

During this conference call, we will make reference to non-GAAP financial measures. And reconciliations to the applicable GAAP measures can be found in our earnings release and on our website. We will also reference our current Investor Presentation, which you can find on our website.

With that, I'll turn the call over to Tommy.

Executive
Thomas Nusz

Good morning, and thanks for joining our call. Oasis completed another solid quarter as we continue to execute on our 2018 plan. Performance in our cornerstone Williston asset remains strong and our subsurface understanding in the Delaware is accelerating, putting us closer to a formal development program on this world-class asset.

I'd like to start with four key points this morning. First, our update last night showcases the capital efficiency of our program, with production guidance up 10% in the fourth quarter of 2018, while we flexed capital up by $80 million. Second, we're capitalizing on strong Williston margins and realized pricing with great LOE and diffs [Phonetic] driving great cash flow from that asset. Third, we are realizing financial improvements, driven by disciplined capital allocation, our divestiture program, reduction in net debt to EBITDA, and growth within cash flow on our E&P business. And lastly, OMP is doing a great job, executing and landing three third-party contracts. It remains an excellent competitive advantage for us. And we, as Oasis' shareholders, participate in its growing success with our ownership of 69% of the LP units of OMP.

Focusing on production, Oasis produced 79,400 Boes per day in the second quarter, an all-time high for the company. Great well performance, coupled with running towards the high end of our completions cadence, put us in a position