Vaalco Energy Inc. (NYSE:EGY) Q2 2020 Earnings Conference Call - Final Transcript

Aug 07, 2020 • 09:00 am ET


Vaalco Energy Inc. (NYSE:EGY) Q2 2020 Earnings Conference Call - Final Transcript


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Good morning everyone. And welcome to the VAALCO Energy Incorporated Second Quarter 2020 Earnings Conference Call. [Operator Instructions] Please also note, today's event is being recorded.

At this time, I would like to turn the conference over to Al Petrie, Investor Relations Coordinator. Sir, please go ahead.

Al Petrie

Thank you, Jamie. Good morning, everyone, and welcome to VAALCO Energy's Second Quarter 2020 Conference Call. After I cover the forward-looking statements, Cary Bounds, our Chief Executive Officer, will review key highlights along with operational results. Liz Prochnow, our Chief Financial Officer, will then provide a more in-depth financial review. Cary will then return for some closing comments before we take your questions. During our question and answer session, we ask you to limit your questions to one and a follow-up. You can always re-enter the queue with additional questions.

I'd like to point out that we posted an updated investor deck on our website this morning that has additional financial analysis, comparisons and guidance that should be helpful. With that, let me proceed with our forward-looking statement comments.

During the course of this conference call, the company will be making forward-looking statements. Investors are cautioned that forward-looking statements are not guarantees of future performance, and those actual results or developments may differ materially from those projected in the forward-looking statements. VAALCO disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Accordingly, you should not place undue reliance on forward-looking statements.

These and other risks are described in yesterday's press release, the presentation posted on our website, and the reports we filed with the SEC, including the Form 10-Q that was filed yesterday. Please note that this conference call is being recorded.

Let me now turn it over to Cary.

Cary Bounds

Thank you, Al. Good morning, everyone. And welcome to our second quarter 2020 earnings conference call. Before I discuss our results, I would like to reflect on the extraordinary challenges that we are facing as an industry and how VAALCO is responding to these challenges. Thus far, VAALCO's operations have not been materially disrupted by the global COVID-19 pandemic. We have managed through the logistical challenges that we have faced since the outbreak and continue to put the safety of our employees and contractors and local stakeholders first.

We're minimizing high-risk activities while actively screening and monitoring employees and contractors, including testing and quarantines with on-site medical supervision before going off shore. We have contingency plans in place in the event we are directly impacted by the pandemic.

While the current pricing environment remains volatile, it has recovered from the lows we saw in April. In response to the lower pricing environment, we have deferred all material discretionary capex. This will allow us to focus on cash flow generation, while preparing for the right market conditions to begin planning the next drilling campaign at Etame.

We released the Vantage drilling rig in early April after completing the 2019-2020 drilling program