Q4 2019 Earnings Call
[noise] all participants please standby your meeting is ready to begin good morning, everyone and welcome to the parents resources fourth quarter earnings call and webcast yesterday, Parex releases audited financial and operating results for the quarter and year end December 31st 2019, like all Paris. This guy.
Oh, just document the Companys financial statements and related M. DNA are available on the company's website at www Dot Parex resources Dot com and on SEDAR.
Before turning the meeting over to Mr., Dave Taylor, President and CEO fabrics resources Inc. I would like to mention that this call is being recorded so we'll be available for playback on the company's website VERYX wed like to remind everyone that remarks made during this session are subject to forward looking statements, which involve significant risks.
Doctors and assumptions and have been fully described in the company's continues disclosure reports.
The information discussed is made as of today's date and time and parents assumes no obligation to update or revise this information to reflect new events or circumstances, except as required by law. Please note that at any time participants on the webcast can submit their questions under the ask a question tab at the top of the web.
Yes interface.
Participants on the phone can press star one.
Now I'd like to pass on the meeting to Paris, President and CEO. Please go ahead Mr. Taylor.
Thank you operator, thanks to everyone on the line for joining myself senior leadership team for Q4 conference call. Thanks for your support parks.
We started today skewing they session I'd like to provide a brief overview tour shareholders and our financial results for the year end 2019.
I will then discuss 2020 guidance sensitivities that we provided in yesterday's press release.
Let's begin by stating that we're very happy with the underlying fundamental strengths where business in Colombia.
Our core southern Cal scenario oilfields continues to deliver both reserves and production [noise] center generating significant free cash flow.
Our recent level Liza discovery on that one block has been very encouraging with initial test rates of over 4600 Beuys per day.
In 2019 company delivered record funds flow from operations of 571 million U.S. against Capex for 208.
This includes annual free cash flow of 362 million year over year oil production growth.
19% for sure.
Increasing our underlying value as measured by or independently audited preserves the pilots which include improved year over year volume increases a 14%.
Proved plus probable year over year volume increased 7% NFC M&A costs improve reserves basis up 750 view, including FTC.
Recycle ratio 3.9 times.
We also purchased over 14.7 million shares returning 224 million to shareholders.
The new inventory to our portfolio with your words, a five blocks.
Good routes, including two blocks DSMB, 25, and 36, which provided entry into a new base in the upper Magdalena.
We maintained a debt free balance sheet with year on working capital of 344 million, which provides multiple options for us to create value in our business 2020.
And our Q4 news release Fleetpride is the price sensitivity table to original $60, Brent 2020 guidance.
Overall, we are positioning our business to generate free cash flow and all Brent oil price scenarios, we're able to achieve this because of our efficient low cost Colombian operations, which generated positive operating netback and the low $20 per barrel Brent price range.
Highlights of our guidance sensitivities during periods of Brent oil prices in the 30 to 35 dollar range. Our full year production will be above the Q4 2019 averaged 54211 B. always a day.
We have a flexible capital program that will be adjusted to be less than forecast funds flow from operations or initial view is that the base 2020, Capex program will be in the range of 150 to 160 million.
The ability to scale capital higher depending on oil prices and cost reductions by maintaining key projects front end work programs.
And utilizing our unique position of being debt free cash rich to accelerate our share buyback program from 55000 shares per day jumped 100000 shares per day.
At the current share price and Brent oil price. This provides us an opportunity to purchase high quality proved plus probable barrels less than $6.
Which generated recycle ratio greater than two times.
Parents is exceptionally.
Exceptional in our industry as a company continues to generate free cash flow maintain a best in class balance sheet and return capital to shareholders. We exited 2019 debt free with over 395 million in cash.
Balance sheet strength provide significant optionality to invest in high quality resource growth opportunities and what this brief introduction I'd like to turn the line back to the operator started to Q in a session.
[noise], Thank you Ms. Heather.
Please press star one at this time, if you have a question there won't be a brief pause while the participants register for questions. Thank you for your patience.
Once again.
Please press star one on your telephone keypad, if you have a question.
[noise] and the first question is from my participants. Please state your name and your company and proceed with your question.
Right I'm.
I'm guessing south Stanton at RBC. So carried out guys can you hear me.
Oh yeah.
Yep cool thank you.
I think what you've done today, it's very getting incentive providing guidance non disclosure.
When do you.
Yeah.
In terms of how long does the we'll probably have to be $36 a $40. Before you you instigate you'll plan because suddenly appears to be in criticized.
Talking to folks so how do you know what school district.
Oh, Hi, Alex can we we've been through the plan on the weekend.
So you know we're managing our capital remember, though we're not we're deferring some things we still high bar developed program accomplished are underway, we still have a full program apart 34 go away.
Still are doing our prep work on our exploration blocks that we acquired the drill sometime in 2000 <unk>. Some of those men 18 to 2021 anyway. So we're still doing that.
Deferring alright, with spikes program, we're deferring or middle Meg program right now, but we're still doing some frontend work at our left delays.
Well and front end work our facilities is still ongoing.
So for some other programs, we have deferred and we'll look at those later on.
Are there others, it's business as usual.
But you have to managing these things looking at what you see today, which is a $35 Brent oil price.
And what does it mean deals I you highlighted at the end of last year that you're looking at opportunities because this.
Eight new opportunities. So does this make you slightly fissile.
Well I think we're going to wait and see what happens with opportunities coming to the table.
I can see both sides of things you know we were in a situation not that long ago, We're where we were trying to possibly solid asset into a down market and it didn't work out very well and I'm thinking a lot of companies that may have been considering bringing assets to the table may not want to do that on the other hasn't maybe situations, where they're being forced to so.
It'll be an interesting I'd say next 30 to 60 days to see what happens on that front.
Okay. Thanks, guys.
Thank you.
Yeah, No further questions registered at this time.
I would now like turn the meeting back over to Mr. Taylor.
Thank you I would like to take this opportunity to thank you for your interest in parts and your continued support of the company further information we invite you to visit our website or cost. Thanks, again and have a good day operator.
That concludes this morning's conference call and wet gas if you would like to replace the call. Please visit the events page of the company's website under newsroom.
GAAP.
Thank you and goodbye.
This conference is no longer being recorded.
No as you put modest said coffeehouse it does WP.
[music].
50 for though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay.
Okay.
She was winning.
[music].
I mean.
Uh huh.
This conference call has ended.
Thank you line is just fine thank you.
Okay. That's good.
<unk>.
She was pending.
[music].
50, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion.
I mean.
Yeah, she would funding.
[music].
Oh says people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay.
She was feeling.
[music].
Let me set up on 50, though.
At this conference call has ended please disconnect your lines at this time. Thank you.
You know.
She was pending.
[music].
Uh huh.
Note that this conference call has ended.
Disconnect your lines at this time thank you.
Okay.
I mean.
She went funding.
[music].
50 phone.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion.
Okay.
She was running.
[music].
Let me set up on 50, though.
This conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion.
<unk>.
She was pending.
[music].
Hi, Physpeed, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay.
I mean.
Yeah, she would funding.
[music].
Oh says people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Yes.
The company.
She was pending.
[music].
Let me set up on 50, though.
This conference call has ended please disconnect your lines at this time. Thank you.
You know.
I mean.
She was pending.
[music].
I don't process before.
Note that this conference call has ended.
Disconnect your lines at this time thank you.
Okay.
Sit down meaning.
She was trending.
[music].
I don't know Fiftyth, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had been.
She was feeling.
[music].
Let me set up on 50, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
You know.
If you tell me.
She was pending.
[music].
I don't process before.
Note that this conference call has ended.
Disconnect your lines at this time thank you.
<unk> opinion, that's good for that.
Sit down meaning.
She was pending.
[music].
Oh says FIFA <unk>.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion up because it had been.
She was running.
[music].
50, though.
At this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean.
She was pending.
[music].
Hi, 50, though.
Note that this conference call has ended.
Disconnect your lines at this time thank you.
If anything that's good for that.
<unk>.
Yeah, she was pending.
[music].
Oh says people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, because it had been.
She was feeling.
[music].
I mean, it sounds like 50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
<unk>.
She was pending.
[music].
Hi, Physpeed, though.
Note that this conference call has ended.
Disconnect your lines at this time thank you.
If any not consider.
I mean.
She was pending.
[music].
Well since FIFA.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had been.
She was feeling.
[music].
Let me set up on 50, though.
At this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean.
She was pending.
[music].
I don't process before.
Please note that this conference call has ended.
Disconnect your lines at this time thank you.
Okay opinion, that's good for that.
I mean.
She would funding.
[music].
Oh Fiftyth.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, not because it had been.
Okay that she was pending.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
She was pending.
[music].
Hi, Physpeed, though.
Note that this conference call has ended please disconnect your lines at this time. Thank you.
If any not good for that.
Sit down meaning.
Yeah, She went funding.
[music].
I don't process FIFA.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, if it had been.
She was feeling.
[music].
I missed <unk> 50, though.
At this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that.
I mean.
She was pending.
[music].
I don't process before.
Note that this conference call has ended.
Disconnect your lines at this time thank you.
Okay opinion, that's good for that.
I mean.
She was funny.
[music].
Oh says people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had been.
Okay that she was feeling.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean.
She was pending.
[music].
Hi, Physpeed, though.
Note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
She was funny.
[music].
<unk> office FIFA.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion up because it had been.
<unk>.
She was funding.
[music].
50, though.
Note that this conference call has ended.
Disconnect your lines at this time thank you.
Okay opinion, that's because at that.
If you tell me.
Okay, because she was pending.
[music].
Hi, Physpeed, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
If any not because they don't sit down meaning superior she went funding.
[music] <unk> Fiftyth huh.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
In the not because it had been.
Okay that she with funding.
[music].
<unk> 50, though.
At this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that.
Tell me.
Yeah, because she was pending.
[music].
So I don't process before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's good for that.
Sit down meaning.
She was funny.
[music].
Oh Syfy phone.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, not because it had been.
Okay that consumer spending.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean.
Because she was pending.
[music].
I don't process before.
Please note that this conference call has ended.
Disconnect your lines at this time thank you.
Okay opinion, that's good for that.
They tell me.
She was funny.
[music].
Oh 50 phone.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, not because it had medical sales to tell me.
She was funding.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean the.
She was pending.
[music].
Hi, Physpeed, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
If any not because they don't sit down meaning.
Yeah, she was funny.
[music].
I don't process FIFA.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had been autonomy.
She was feeling.
[music].
<unk> Fiftyth.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean.
She was pending.
[music].
I don't process before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, she was funny.
[music].
<unk> office people.
Note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion up because it had medical sales autonomy.
She was running.
[music].
50, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
<unk>.
Okay, and I could see what funding.
[music].
Hi, Physpeed.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion up because it had medical sales autonomy.
She was funding.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean you.
Okay, because she was pending.
[music].
Hi, Physpeed.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
If any not because they don't sit down meaning.
Yeah, she would funding.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
In the units if it had been kind of meaning.
She was feeling.
[music].
<unk> 50, though please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that.
I mean.
Cushy with funding.
[music].
I don't process before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Opinion, not because they don't sit down meaning.
Yeah, because she was funny.
[music].
Oh Syfy phone.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, not because it had medical you know how many people pick a consumer spending.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because that's something else autonomy.
She was pending.
[music].
I don't process before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
If any not because they don't sit down meaning.
Yeah, she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, not because it had medical sales to tell me.
She was funding.
[music].
Sixtyv.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that that's something else autonomy.
Yeah, because she was pending.
[music].
Hi, Physpeed.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Depending up because they don't sit down meaning.
Yeah, she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had been cofetel autonomy.
She was feeling.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean you.
Okay, because she was pending.
[music].
Hi, Physpeed.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, she with funding.
[music].
<unk> office FIFA.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion up because it had medical health autonomy.
She was funding.
[music].
Success fees or.
Note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that can you tell me.
And I could see what funding.
[music].
Hi, Physpeed, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Okay, because she was funny.
[music].
Process FIFA.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, not because it had medical sales to tell me.
Okay that she was feeling.
[music].
50, though please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean.
Dinner cushy with funding.
[music].
Hi, Physpeed, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion up because it had medical films autonomy.
She was funding.
[music].
Sixtyv.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean you.
Okay, because she was pending.
[music].
Hi, Physpeed.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Depending up because that's going to host autonomy.
Yeah, She went funding.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had medical sales to tell me.
Yeah, She was funding.
[music].
<unk> Fiftyth. Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that.
I mean.
Dinner, because she was pending.
[music].
I don't process before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, she would funding.
[music].
Oh says people <unk>.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had medical sales to tell me see pick a consumer spending.
[music].
50, though please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that.
I mean you.
Okay Cushy what pending.
[music].
Hi since before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, that's good for that that's going to home sit down meaning.
Okay, because she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
In the units because it had medical sales autonomy.
Yeah, She was funding.
[music].
Sixtyv.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that.
I mean you.
Okay, because she was pending.
[music].
Hi, Physpeed.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion up because it had medical health autonomy.
She was funding.
[music].
Success fees or.
No that this conference call has ended.
Disconnect. Your line at this time thank you.
Okay opinion, that's because at that can you tell me.
Okay, because she was funding.
[music].
Hi, Physpeed, though.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning she prepare she was funny.
[music].
Since people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
In the units because it had medical health autonomy.
Okay, well she was funding.
[music].
Hi, Steve.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that can you tell me.
And I could see what funding.
[music].
I don't process before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Opinion, not because they don't sit down meaning.
Okay, because she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
If you compare opinion not because it had medical sales to tell me.
Yeah, she with funding.
[music].
<unk> 50, though please note that this conference call has ended please disconnect your lines at this time thinking.
Opinion, that's because it does it tell me.
'cause she wants pending.
[music].
I don't process before.
Note that this conference call has ended please disconnect your lines at this time. Thank you.
Depending up because that's what they don't sit down meaning.
Yeah, She went funding.
[music].
50 phone.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
If you compare opinion not because it had medical sales to tell me.
She was funding.
[music].
That's nonsense FIFA. Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that that's something else autonomy.
Because she was pending.
[music].
Hi, Physpeed, though.
Note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, Nokia for that that's going to host autonomy.
She was funny.
[music].
Oh says people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, not because it had been cofetel. So tell me see pick a consumer spending.
[music].
Hi, 50, though please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because it does it tell me.
Okay Cushy with funding.
[music].
I don't process be phone.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
Opinion, not good for that that's going to host autonomy.
Okay, because she was pending.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
If you compare opinion not because it had medical sales to tell me see okay that she was funding.
[music].
<unk> 55.
Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that that's something else autonomy.
Okay, because she was pending.
[music].
Process before.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, she was funny.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
In the units because it had medical fails to tell me.
She was funding.
[music].
50, though.
Note that this conference call has ended please disconnect your lines at this time. Thank you.
Okay opinion, that's because at that can you tell me.
Okay, because she was pending.
[music].
Hi, since before the.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
<unk> opinion, not because they don't sit down meaning.
Yeah, She was funding.
[music].
<unk> office people.
Please note that this conference call has ended please disconnect your lines at this time. Thank you.
In the units because it had medical sales to tell me.
She was funny thing.
[music].
Since FIFA. Please note that this conference call has ended please disconnect. Your line at this time. Thank you.
Okay opinion, that's because at that got something else autonomy.
Okay, because she was pending.
[music].