Laredo Petroleum, Inc. (NYSE:LPI) Q1 2020 Earnings Conference Call - Final Transcript

May 07, 2020 • 08:30 am ET

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Laredo Petroleum, Inc. (NYSE:LPI) Q1 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Laredo Petroleum, Incorporation's First Quarter 2020 Earnings Conference Call. My name is Tawanda, and I will be your operator for today. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes.

It is now my pleasure to introduce Mr. Ron Hagood, Vice President, Investor Relations. Sir, you may proceed.

Executive
Ron Hagood

Thank you, and good morning. Joining me today are Jason Pigott, President and Chief Executive officer; Karen Chandler, Senior Vice President and Chief Operations Officer; Michael Beyer, Senior Vice President and Chief Financial Officer; as well as additional members of our management team.

Before we begin this morning, let me remind you that during today's call, we'll be making forward-looking statements. These statements, including those describing our beliefs, goals, expectations, forecast and assumptions, are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company's actual results may differ from these forward-looking statements for a variety of reasons, many of which are beyond our control. In addition, we'll be making reference to non-GAAP financial measures. Reconciliations to GAAP financial measures are included in yesterday's news release.

Yesterday afternoon, the Company issued a news release and presentation detailing its financial and operating results for first quarter 2020. We will refer to the presentation by page during today's call. If you do not have a copy of this news release or presentation, you may access it on the Company's website at www.laredopetro.com.

I will now turn the call over to Jason Pigott, President and Chief Executive Officer.

Executive
Jason Pigott

Good morning and thank you for joining us on our call today. I hope you and your families are healthy and safe during these trying times. As you read in our press release issued yesterday, Laredo continues to improve in nearly every aspect of our business despite the challenging circumstances we are facing. In November 2019, we put forward our strategy for increasing stakeholder value which we outline on Slide 3. Although this strategy was formulated in a very different commodity price environment, we believe it is still actionable in the current environment. Results in the first quarter 2020 demonstrate our success optimizing the value of our established acreage position.

We reduced LOE from $3.34 per BOE in the first quarter of 2019 to $2.80 per BOE this quarter. We reduced D&C costs from $700 a foot in the first quarter of 2019 to $630 per foot this quarter. Our wider-spaced wells continue to outperform our type curve on our core acreage footprint as well. Additionally, we continue to expand our footprint in Howard County adding 1,300 acres so far this year, continuing to bolster our position at a significantly reduced cost compared to prior transactions in the area.

In this tough operating environment, we believe there will be opportunities to scale up our operational advantages using our financial position to make capital accretive acquisitions, which improve our capital efficiency and enhance margins. While the current