California Resources Corporation (NYSE:CRC) Q3 2019 Earnings Conference Call - Final Transcript

Nov 04, 2019 • 05:00 pm ET


California Resources Corporation (NYSE:CRC) Q3 2019 Earnings Conference Call - Final Transcript


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Good afternoon and welcome to the California Resources Corporation Third Quarter 2019 Conference Call. [Operator Instructions]. Please note today's event is being recorded.

I would now like to turn the conference over to Scott Espenshade. Please go ahead, sir.

Scott Espenshade

Thank you. I'm Scott Espenshade, Senior Vice President, Investor Relations. Welcome to California Resources Corporation's third quarter 2019 conference call. Participating on today's call is Todd Stevens, President and Chief Executive Officer of CRC; and Mark Smith, Senior Executive Vice President and Chief Financial Officer; as well as several members of the CRC executive team.

I'd like to highlight that we have provided slides in our Investor Relations section on our website, These slides provide additional insight into our operation and our third quarter results, plus additional information. Also, information reconciling non-GAAP financial measures discussed to the most directly comparable GAAP financial measure is available in the Investor Relations portion of our website and in our earnings release.

Today's conference call contains certain projections and other forward-looking statements within the meaning of federal securities laws. These statements are subject to risks and uncertainties that may cause the actual results to differ from those expressed or implied in these statements. Additional information on factors that could cause results to differ is available in the company's 10-Q, which is being filed later today. We ask that you review it, when available and the cautionary statement in our earnings release. A replay and a transcript will be made available on our website following today's call and will be available for at least 30 days following the call.

As a reminder, we have allotted similar time for Q&A at the end of our prepared remarks. We would ask that participants limit their question to a primary question and a follow-up.

I will now turn the call over to Todd.

Todd A. Stevens

Thank you, Scott, and thank you to everyone for attending today's earnings call. First and foremost, I'd like to thank all of California's firefighters and first responders for their continued efforts to battle fires across our state.

Turning to CRC, our large portfolio of low-decline conventional assets and significant inventory of projects with low capital intensity continue to uniquely position us for superior value creation, even at lower commodity prices. I'd like to reiterate that we believe that the maintenance capital required to hold oil production flat, that will continue to be between $300 million and $400 million annually of internal drilling, completion and workover capital. With continued operational efficiencies and our recent organizational redesign, we expect maintenance capital to trend down from current levels.

Our sustained, strong, safety environmental record, combined with our deep geologic insight across four of California's distinct basins, continues to distinguish CRC as the operator of choice for our partners and state and local governments. We operate in a market that has a large thirst for our crude oil. CRC's native production provides a reliable base supply for refineries that import over 70% of their crude by tanker, with the large