Petrus Resources Ltd. (PRQ) Earnings Call Transcript & Summary

Good day, and thank you for standing by. Welcome to the Petrus Resources Fourth Quarter 2024 Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Ken Gray. Please go ahead.

Good morning, and welcome to Petrus Resources Q4 2024 and year-end earnings call. My name is Ken Gray, CEO of Petrus; and I am joined here by our executive team of Matthew Wang, our CFO; Matt Skanderup, our COO; and Lindsay Hatcher, our VP Commercial and Corporate Development. The story for Q4 and for 2024 in general was our ability to generate strong cash flow, $12.5 million for the quarter and $50.1 million for the year, and to hold production relatively flat, averaging 9,066 BOE per day in Q4, down only 4% from Q4 2023. We did this despite working through the lowest gas prices in 30 years. We also did it despite cutting capital over 60% from 2023 in response to these low gas prices. A key to achieving these results was an improvement in capital efficiency, allowing us to generate more production and cash flow for each dollar of capital invested. This was primarily driven by advances in our completion design, which resulted in better productivity at a lower cost. We are also continuing to improve operating efficiencies. One achievement of note in that area has been the increase in NGL recoveries in Q4, where we generated a 25% improvement in NGL yields compared to Q4 2023. We released our 2025 capital budget and guidance late last month, and the year is off to a strong start. We have already drilled as many operated wells as we did all of last year and a couple of them are already on production. We've also completed the extension of our North Ferrier pipeline, which extends to our largely undeveloped lands to the north, and the remaining wells we've drilled will be completed and start flowing down that line in Q2. Looking forward, we are planning to continue drilling through breakup. Production should start to pick up in Q2, hopefully coinciding with continued strong liquids prices and improving natural gas prices. With that, I'll open the floor to questions.

[Operator Instructions] I'm showing no questions at this time. I would now like to turn it back to Ken Gray for closing remarks.

Okay. Thanks. There is 1 thing I'd just like to add here since we don't have any questions, but I think it's been on a lot of investors' minds. We kind of find ourselves in the middle of a significant political turmoil here. We've got a federal election going on, and of course, the threat of tariffs from the U.S. This can be somewhat unsettling and is never good for business. But I'd like to emphasize that at Petrus, we produce commodities that are in high demand and will remain so for the foreseeable future. We produce these commodities at a very competitive cost and are able to generate strong cash flow even at relatively low prices. When the business has strong fundamentals, short-term disruptions have little effect on long-term performance. Petrus has proven its strength and demonstrated it is built for sustained success. So despite the current turmoil, we are excited about the future and look forward to continue finding, developing and producing oil and gas in Alberta. Thanks for listening and for your continued interest and support for Petrus.

Thank you for participation in today's conference. This does conclude the program. You may now disconnect.