Riley Exploration Permian, Inc. · AMEX:REPX
Riley Exploration Permian — Q3 2021 Earnings Presentation
26 slides from Riley Exploration Permian's earnings presentation, Aug 12, 2021
Slide 1: Fiscal Third Quarter 2021 Operating and Financial Update
Fiscal Third Quarter 2021 Operating and Financial Update AUGUST 2021
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements Forward-Looking Statements This presentation contains projections and other forward-looking statements within the meaning of federal securities laws. These projections and statements reflect Riley Exploration Permian, Inc.’s (“Riley Permian”) current views with respect t
Slide 3: Fiscal Third Quarter 2021 (FQ3) Highlights
1 Fiscal Third Quarter 2021 (FQ3) Highlights Future dividends are subject to approval by the board of directors. Yield based on share price as of August 6, 2021.. Non-GAAP financial measure, see Appendix for reconciliation.Non-GAAP financial measure. Margin calculated as Adjusted EBITDAX divided by
Slide 4: Continued Execution on Growth and Cash Flow Generation
Total Net ProductionMBoe6/d Estimated Net Proved Reserves(1)MMBoe Adjusted EBITDAX(2)$MM 4 Continued Execution on Growth and Cash Flow Generation 9/30/17 through 9/30/20 reserves as of Netherland Sewell & Associates (NSAI). 6/30/21 reserve estimates per Riley Permian management estimates, subject to
Slide 5: Growing within the Limits of Capital Allocation Discipline
Operating Cash Flow(1) Relative to Capex(2), $MM % of Adj. EBITDAX(3) Allocated to Capex(2) and Dividends Total Leverage Ratio(4) 2 Growing within the Limits of Capital Allocation Discipline Cash Flow from Continuing Operations.Total cash capital expenditures before acquisitions.Non-GAAP financial m
Slide 6: Excelling on Full-Cycle Cash Conversion Efficiency
6 Excelling on Full-Cycle Cash Conversion Efficiency Non-GAAP financial measure. Recycle Ratio calculated as Cash Margin divided by Finding & Development (F&D) Costs. Cash Margin defined in Appendix. F&D Costs calculated as total reserve additions divided by capitalized costs of reserve additions. F
Slide 7: Update on Riley's EOR Pilot Project
Calendar Qtrs. 4Q21 1Q22 2Q22 3Q22 4Q22 Update on Riley’s EOR Pilot Project 7 Execution Status Advancing execution following capital raiseObtained many permits already; remainder expected to be obtained during 2021Drilling / casing / logging of vertical injection wells to begin in Sept-21 and finish
Slide 8: Forward Guidance
8 Forward Guidance Ne Quarter OnlyFQ4 21 Full YearFY21 Comments Capex $20 - 26MM $60 - 66MM FY21 Capex budget midpoint increased by approximately ~$6-10MM from prior guidanceEstimated incremental spend relates to acceleration of EOR project (injection wells, infrastructure and CO2 tap), as well as c
Slide 9: Company Overview
Company Overview 9
Slide 10: Riley Permian at a Glance
Riley Permian at a Glance New breed of small-cap E&P outperforming large-caps in operational and financial metricsLow base-decline assets enable less capital-intensive reinvestment for maintenance and growthShareholder-focused capital allocation framework includes growing within moderate reinvestmen
Slide 11: Company History and Stock Information
Company History and Stock Information 3 NYSE American: REPX Shares outstanding includes unvested shares. Future dividends are subject to approval by the board of directors.
Slide 12: Riley's Dividend Information
Riley’s Dividend Information 12 FY19 and FY20 based on actual dividends paid by private, predecessor entity, and estimated share count to reflect current public company status post merger. Future dividends are subject to approval by the board of directors. The payment of a regular quarterly dividend
Slide 13: Solid asset base, strong balance sheet supports dividend (CEO quote)
13 Our solid asset base, strong balance sheet and manageable production profile supports our ability to generate free cash flow to maintain our quarterly dividend.” – Bobby Riley, Chairman & CEO “ Future dividends are subject to approval by the board of directors.
Slide 14: Committed to ESG Engagement
Committed to ESG Engagement 14 Energy transition viewed as an opportunity for engagement and new ventures, evidenced by CCUS and ACO2 initiativesOperable gas gathering lines are installed ahead of first production to mitigate flaring – resulting in 62% and 20% year over year reduction in flaring in
Slide 15: Overview of Conventional, Non-Shale Assets
15 Overview of Conventional, Non-Shale Assets Source: U.S. Geological Survey and Riley Permian. Riley Permian’s core focus is on development of horizontal San Andres production on the Northwest Shelf of the Permian BasinThe San Andres is a proven Conventional Reservoir that has been producing since
Slide 16: Champions Asset is an Extension of a Giant Field
16 Champions Asset is an Extension of a Giant Field Conventional assets provide for low base-decline and low capital intensityAmong the lowest finding & development costs for U.S. oil reservesMulti-year continued development of predictable, low risk undeveloped locationsExtensive, untapped potential
Slide 17: Oil Production and Decline Profiles vs. Permian Shale
17 Riley Permian wells include 15 operated wells that were drilled and completed during 2018. Source: Riley Permian. Permian Shale wells include wells with initial production in 2018; producing formations limited to Wolfcamp, Wolfbone and Bone Spring; counties limited to Eddy, Glassock, Howard, Lea,
Slide 18: SEC Proved Reserves Summary
SEC Proved Reserves Summary 18 Industry-leading finding & development costs, including 3-year average total F&D of $4.76/Boe and Drill Bit F&D of $4.16/Boe(1)20+ Year proved reserve life provides significant runway for further development(2)Internal estimates for reserves as of 6/30/21 include total
Slide 19: Core Asset Is Adjacent to Major EOR Projects
Riley’s Champions asset is directly adjacent to several of the largest and most successful EOR projects in the U.S., including the Wasson Field, with individual units operated by some of the largest U.S. operatorsRiley has collected extensive cores, logs and 3-D seismic data over the Champions Field
Slide 20: Riley's EOR Pilot Project Design
Riley’s EOR Pilot Project Design 20 1.5 miles Existing Horizontal wells Proposed Injection wellsSection LinesPilot Area960-Acre Outline Illustrative Design for 960-Acre EOR Project Area Design will include 2 rows of 6 vertical injectors each, in a staggered patternVertical injection wells will apply
Slide 21: Appendix
Appendix 21 [ insert footnotes here ]
Slide 22: Commodity Hedging Position as of June 30, 2021
22 Commodity Hedging Position as of June 30, 2021 FQ3 Hedging Updates Include:Oil2022 swaps totaling 360 MBls at $60.36/Bbl2023 swaps totaling 330 MBbls $59.63/Bbl2022 basis swaps at a positive spread of +25¢/BblNatural Gas2021 swaps totaling 210,000 Mcf at $3.30/MMBtu
Slide 23: Non-GAAP Reconciliations (Cont'd.) Adjusted Net Income
23 Non-GAAP Reconciliations (Cont’d.) Adjusted Net IncomeThe Company defines “Adjusted Net Income” as Net Loss plus, when applicable, unrealized loss on derivative contracts; impairment expense; transaction costs; the loss of discontinued operations; income tax expense related to a change in tax sta
Slide 24: Non-GAAP Reconciliations: Adjusted EBITDAX
24 Non-GAAP Reconciliations Adjusted EBITDAXThe non-GAAP financial measure of Adjusted EBITDAX (as defined below), as calculated by us below, is intended to provide readers with meaningful information that supplements our financial statements prepared in accordance with GAAP. Further, these non-GAAP
Slide 25: Non-GAAP Reconciliations: Cash G&A, Cash Costs and Cash Margin
25 Non-GAAP Reconciliations (Cont’d.) Cash G&A, Cash Costs and Cash MarginThe Company defines “Cash G&A” as general and administrative expense less share-based and unit-based compensation and contract services–related parties revenue plus cost of contract services–related parties. The Company define
Slide 26: Non-GAAP Reconciliations: Free Cash Flow
26 Non-GAAP Reconciliations (Cont’d.) Free Cash FlowThe Company defines “Free Cash Flow” as Cash Flow from Continuing Operations, less capital expenditures before acquisitions. Free Cash Flow is a measure that we use as an indicator of our ability to fund our development activities and generate exce
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