Pioneer Natural Resources Co. (NYSE:PXD) Q2 2020 Earnings Conference Call - Final Transcript

Aug 05, 2020 • 10:00 am ET

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Pioneer Natural Resources Co. (NYSE:PXD) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Welcome to Pioneer Natural Resources Second Quarter Conference Call. Joining us today will be Scott Sheffield, President and Chief Executive Officer; Rich Dealy, Executive Vice President and Chief Financial Officer; Joey Hall, Executive Vice President of Permian Operations; and Neal Shah, Vice President, Investor Relations.

Pioneer has prepared PowerPoint slides to supplement their comments today. These slides can be accessed over the Internet at www.pxd.com. Again, the Internet site to access the slides related to today's call is www.pxd.com. At the website, select investors, then select earnings and webcast. This call is being recorded. A replay of the call will be archived on the Internet site through August 31, 2020. The Company's comments today will include forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigations Reform Act of 1995, these statements and the business prospects of Pioneer are subject to a number of risks and uncertainties that may cause actual results in future periods to differ materially from the forward-looking statements. These risks and uncertainties are described in Pioneer's news release on Page 2 of the slide presentation and in Pioneer's public filings made with the Securities and Exchange Commission.

At this time, for opening remarks, I would like to turn the call over to Pioneer's Vice President, Investor Relations, Neal Shah. Please go ahead, sir.

Executive
Neal H. Shah

Thank you, Shelby. Good morning, everyone, and thank you for joining us. Let me briefly review the agenda for today's call. Scott will be up first, who will review and discuss our excellent second quarter results. He will also detail our framework for reinvestment that drives strong free cash flow generation and return of capital to shareholders. After Scott concludes his remarks, Joey will then review our strong operational performance and best-in-class oil production. Rich will then update you on our strong financial position and balance sheet strength. Scott will then return to discuss Pioneer's focus on sustainable practices. After that, we will open up the call to your questions.

Thank you. So with that, I'll turn it over to Scott.

Executive
Scott D. Sheffield

Good morning. Thank you, Neal. I hope everyone is doing well in this tough environment we've had over the last several months. I'm going to start off on slide number three. Despite the price collapse that we've had, especially for the second quarter, we're delivering $165 million of free cash flow during that quarter and we [Phonetic] look out for the entire year, and that's based on a strip of about a week ago. The strip has moved up. Brent's already up to about $48.50 this morning. We were using a strip of about $46, but estimated 2020 free cash flow of about $600 million. Also, on a later slide, we'll be increasing our guidance for 2020 for production. At the same time, while capex guidance remains unchanged.

With our recent bond deal, we're continuing to reduce our cost of capital and improve liquidity. Also, we continue to be the best in the Permian Basin in regard to stats