Enerplus Corporation (NYSE:ERF) Q3 2019 Earnings Conference Call - Final Transcript

Nov 08, 2019 • 11:00 am ET


Enerplus Corporation (NYSE:ERF) Q3 2019 Earnings Conference Call - Final Transcript


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Good morning, ladies and gentlemen, and welcome to the Enerplus Corporation Q3 2019 Results Conference Call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question-and-answer session. [Operator Instructions] This call is being recorded on Friday, November 8, 2019. I would now like to turn the conference over to Mr. Drew Mair. Please go ahead, sir.

Drew Mair

Thank you, operator, and good morning, everyone. Thank you for joining the call. Before we get started, please take note of the advisories located at the end of today's news release. Our financials have been prepared in accordance with US GAAP. All discussion of production volumes today are on a gross company working interest basis, and all financial figures are in Canadian dollars, unless otherwise specified.

I'm here this morning with Ian Dundas, our President and Chief Executive Officer; Jodi Jenson Labrie, Senior VP and Chief Financial Officer; Ray Daniels, Senior VP, Operations; Shaina Morihira, VP, Finance; and Garth Doll, VP, Marketing. Following our discussion, we'll open up the call for questions.

With that, I'll turn it over to Ian.

Ian C. Dundas

Thank you, Drew, and thanks to all of you for joining us today. I'll get right into our third quarter results. We delivered another strong sequential increase in our oil production in the third quarter, following a very active completions program in the Bakken during the summer months. Bakken production was up 18% from the prior quarter, driving Company liquids production growth of 14%.

And with the meaningful reduction to our share count over the last year, our liquids production per share increased 22% compared to the same period a year ago. Production continues to track our guidance, and we've provided fourth quarter production guidance of 103,000 to 107,000 BOE per day, with liquids production of 58,000 to 60,000 barrels per day.

We've effectively completed our program this year for bringing new wells on stream in the Bakken, and fourth quarter capital activity will be approximately 30% lower compared to the third quarter and primarily focused on drilling in preparation for 2020. This will result in modestly lower sequential production in the fourth quarter. The relatively light fourth quarter capital program is also expected to result in significant fourth quarter free cash flow.

Moving on to share repurchases. As highlighted in our release today, we were actively buying our stock in the quarter. We repurchased approximately 7 million shares at a weighted average price of about CAD9 per share. Since we began buying our stock through the third quarter last year, we've now repurchased and canceled over 24 million shares, representing approximately 10% of our shares outstanding. We continue to see attractive value on our shares at current levels, but we'll remain disciplined with our capital allocation as we continue to focus on ensuring we maintain our balance sheet strength.

Through the first nine months of the year, we had effectively been pre-spending [Phonetic] our fourth quarter free cash flow to buy back stock. Jodi will provide more