Q2 2025 Ring Energy Inc Earnings Call
Good morning and welcome to the ring energy, second quarter and full year 2025 earnings conference call. At this time, all participants are in a listen-only mode. They question and answer session will follow the formal presentation.
To ask a question, you may press star then 1 on your telephone keypad to withdraw your question. Please. Press star then 2
Please note this event is being recorded.
I will now turn the call over to Al Petri investor relations for ring energy.
Thank you, operator, and good morning everyone. We appreciate your interest in ring energy.
We got our call with comments from Paul McKenna, a chairman of the board and CEO, who will provide an overview of key matters for the second quarter of 2025, as well. As our updated Outlook, we will then turn the call over to Travis Thomas ring energy.
Executive VP and CFO who will review our financial results. Paul will then return with some closing comments before we open the call for questions, also joining us on the call today and available for the Q&A session, are Alex, Diaz, executive VP and chief operations officer James, Parr executive VP and chief exploration officer, and Shaun Young, Senior VP of operations,
During the Q&A session, we ask you to limit your questions to 1 and a follow-up. You're welcome to re-enter the queue later with additional questions. Would also note that we have posted an updated corporate presentation on our website.
During the course of this conference call, the company will be making forward-looking statements within the meaning of federal Securities. Laws 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. Finally, the company can give no assurance that such hard-looking statements, will prove to be correct. Bring energy 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 and our filings with the SEC. These documents can be found in versus section of our website.
Located at www.ring.com.
Should 1 or more of these risk materialized or should underlying assumptions. Proved incorrect, actual results May Vary materially
This conference call also includes references to certain non-gaap Financial measures reconciliations are these non-gaap Financial measures to the most directly comparable measure on the Gap are contained in yesterday's earnings release. Finally. As a reminder, this conference call is being recorded. I would now like to turn the call over to Paul McKenney our chairman and CEO.
Thanks, Al and thank you everyone for joining us today and for your continued interest in ring energy.
We enjoyed another strong quarter, a quarter, where we not only set new records for oil and Boe sales, but we also set a record for adjusted free cash flow despite considerably lower oil prices.
Our operational performance. During the second quarter of 2025 was largely due to the continuing success, we enjoyed in the first quarter. Namely that our PDP production base, the new wells drill so far this year and the newly acquired Lime Rock assets. Continue to perform at the higher end of our forecasts.
Also contributing to Our Success, was the progress, our operating team made by reducing operating costs. There are several highlights to point out in this regard. First was a quick and efficient integration of the lime rock assets into our operations where we not, only reduce LOE cost of the acquired assets.
But realize cost savings with our existing Assets in the chapter leg operating area as well.
These costs reductions were due to the reduction of field of the required field staff by approximately 50% due to the proximity of our existing assets, and the ability of Ring's field management to reorganize operational, responsibilities resulting in the combined operations being more efficient.
Wealth failures with more responsible repairs and getting the wells back online sooner.
We're also able to incorporate existing vendor services such as routes about Crews work over, rigs, Haul trucks, Etc. That resulted in more efficient use and reduced expenses for these services in our combined operations.
Other highlights are related to eloe reductions across other areas of our operating base, our operations team continues to drive costs out of our operations where we realize about 400,000 dollars in savings per month. During the second quarter, we have significantly reduced the number of roundabout gangs and expenses around supplies and materials due to more efficient management. From our field Construction Group, We are continuing to see reductions in fields, Staffing related costs, from optimizing field responsibilities and Lease operator routes
Our production performance cost savings and the acquisition of a lime rock assets, had an important impact on a performance in the second quarter and the benefits to our stockholders, are depicted on slide 10 in our corporate presentation posted this morning.
Our production for share, increased 13% over the prior quarter because of the lime rock acquisition, and the strong performance and improved metrics, reported this quarter, our all-in cash. Operating costs dropped almost $3 for Boe or 12% due to our cost savings initiatives.
Finally, and because of our strong performance, this quarter, our adjusted free cash flow on a dollar for Boe basis, is up over 250%, but we are not stopping there. We believe we have additional gains to make reducing our operating costs.
1 change. We are making we're pointing out is that we are currently expanding the scope of operations of 1 of the chemical vendors used in the South into our Northern assets.
We expect this important change to drive future incremental savings already seen in our Southern operations by reducing direct chemical treating costs, eliminating hot oil treatments, lowering well failure frequencies, and reducing associated workover costs. This transaction transition should be completed in the third quarter of this year.
So let's review some of the specific results of the second quarter.
We sold 14511 barrels of oil per day, which was near the high end of guidance and 21,295, barrels of oil equivalent per day, which was just below the midpoint of guidance.
When combining our record setting quarterly production with below. The low end of guidance lease, operating expenses of $10.45 per Boe, and a 48% reduction in capital spending over the prior quarter, we achieved record free, cash flow of 24.8 million marking the 23rd consecutive quarter of generating free cash flow.
With respect to our Drilling and completion activities. During the quarter, we drilled completed and placed on production too wells in the central Basin platform. This included 1 1 mile horizontal well in Andrews County and 1 vertical. Well in crane County both with a working interest of 100%,
like the wells drilled in the and completed in the first quarter of 2025, both Wells are meeting or exceeding, our pre-drilled expectations associated with initial production results.
Regarding our financial success. For the second quarter. It was largely due to our quick response to the drop in oil. Prices experience, early in the quarter and the operational outperformance, we just described. I will now turn this call over to Travis to share the highlights and details of our second quarter financial position. Travis
Thanks, Paul and good morning everyone. We began the quarter energized by the integration of the new assets into the ring family. But on Day 2, the Tariff turmoil. Instilled uncertainty into the market driving prices down by 17% over the next week we quickly adapted to the lower price environment and we're able to finish the quarter with record production eloe below. The guidance range reduced sequential GNA and a pullback in capital spending.
The combination of these resulted in adjusted free cash flow of 204.8 million, a new record high, enabling us to pay down 12 million in debt. As I say, every time balance sheet Improvement has been and will remain a top priority for the company.
And we're by the improved terms of the facility.
1 of the most. Impactful was a 25 basis, point reduction in the pricing grid leading to interest expense savings on day 1 for context. That is 250,000 in annual savings on each 100 million outstanding.
This amended facility provides Ring with a 34-month extension of the facility center, expiring in June of 2029. We're excited to welcome Bank of America as our new administrative agent and to add City Bank to the banking syndicate.
Of course, we are grateful to all of our banks for the ongoing support and we believe our strong Partnerships will be a catalyst for future growth.
Turning now to the metrics for the quarter. It is evident their team is executing on the operational plan.
Starting with sales volumes, we sold a record 14,511 barrels of oil per day exceeding. The midpoint of our guidance and a record 21,295, Boe per day. Slightly below the midpoint,
As for the second quarter, 2025 pricing, our overall realized price decreased 11% to $42.63 per VOE from 47.78 in the first quarter.
Driving. The overall decrease was an 11% lower realized oil price of $22.69 which is the lowest realized price since the first quarter of 2021.
Realized gas price, which includes the majority of our GTP cost was a, a negative $1.31 down from -19 cents. In the first quarter NGL prices, decreased 36% in the quarter to 619
Our second quarter average crude oil differential from 9x WTI was -99 cents per barrel versus a negative -89 cents for the first quarter. Our average natural gas price differential from 9x futures pricing for the second quarter was -4.67 cents per mcf compared to -3.81 cents per mcf for the first quarter. Our realized NGL price averaged 10% of WTI compared to 15% for the first quarter.
The result was revenue for the second quarter of 82.6 million despite the weakening prices.
We continue to Target higher oil, mixed opportunities as oil accounted for 100% of total revenue, while it was only 68% of total production.
Overall, our sequential Revenue had a 4% increase from the first quarter, which was driven by a positive, 16.8 million volume variance, offset by a negative 13.3 million price variance.
Moving to expenses, eloe was 20.2 million or $10.45 per Boe versus 19.7 million or $11.89 per Boe in the first quarter.
We were pleased to see eloe lower on a Boe basis quarter to quarter, and well, the lower guidance of 11.50 to 12.50 per Boe.
Cash G&A, which excludes share-based compensation, was $5.8 million compared to $6.9 million in the first quarter.
The decrease was partially driven by annual costs incurred in the first quarter associated with the audit, 10K and proxy.
The second quarter also saw a lower salaries and bonus cruel.
Our second quarter results include a gain on derivative contracts of 14.6 million versus a loss of 900,000. For the first quarter, the second quarter gain included, a 14 million dollar unrealized gain and 600,000 realized game. As a reminder, the unrealized gain and loss is just the difference between the mark-to-market values period to period.
Finally, for Q2 we reported net income of 20.6 million or 10 cents per diluted, share compared to the first quarter, net income of 9.1 million or 5 cents per diluted share.
Excluding the after tax impact of pre-tax items, including non-cash unrealized, gains and losses on Hedges and share-based compensation expense our second quarter 2025 adjusted. Net income was 11 million or 5 cents per diluted share while the first quarter of 2025 adjusted. Net income was 10 million, 10.7 million, or 5 cents per diluted share.
We posted second quarter 2025 adjusted evida of 51.5 million versus 46.4 million. For the first quarter with most of the difference, attributed to higher oil Revenue higher realized Hedges and lower GNA.
During the second quarter, we invested 16.8 million in capital expenditures which was 48%, lower than the first quarter and below the 18th of guidance.
Actually 15.6 million and lower Capital spending combined with 5 million higher and Eve a DOT compared to the first quarter.
We ended the period with 448 million draw on our credit facility after a 12 million. Paid out with the current borrowing base of 585 million. We ended the quarter with availability of 137 million and our leverage ratio of 2.05 times, which includes the 10 million deferred payment due on December of 2025.
Moving to our hedge positions.
For the last 6 months of 2025, we currently have approximately 1.3 million barrels of oil, hedged with an average downside protection. Price of 64.87 this covers approximately 55% of our oil sales guidance, midpoint
We also have 1.5 BCF natural gas hedge with an average downside protection. Price of 3.37 covering approximately 42% of our estimated natural, gas sales, based on the midpoint.
For detailed, breakout of our hedge position, please see our earnings release and presentation which include the average price. For each contract type.
We are reaffirming our updated full year 2025 production. Guidance of 12,700 to 13,700 barrels of oil per day and 19,200 to 20,700 Boe per day.
Yesterday, we presented a guidance for the third quarter. Total sales volumes of 19,200 to 21200 boies per day and oil production, to range between 12,850 and 13850, barrels of oil per day. Resulting in a 66% oil mix,
For the second half of 2025, we are continuing to guide total sales volumes of 19,000 to 21,000 Boe per day, with oil production in a range of 12,500 to 14,000 barrels of oil per day. Additionally, with a 66% oil mix on the cost side, we are updating guidance to $1 to $12 per Boe through the remaining quarters of 2025.
Please refer to our second quarter, earnings, release and Company presentation for full details by period. I would note that of the 4 to 6 Wells included in our drilling program for the third quarter, we have drills completed and placed on production 3, horizontal Wells to date.
As in the past, we retain the flexibility to react to changing commodity prices and market conditions, as well as manage, our quarterly cash flow.
So with that, I will turn it back to Paul for his closing comments. Paul.
Thank you, Travis. As you know, we enjoyed a strong quarter, despite the backdrop of lower energy prices, we are proud of the team's operational performances quarter, delivering, strong production, significant reductions in eloe costs and robust performance from the new wells drill this year. We also demonstrated this
Quarter that we can successfully manage the aspects of our business that are within our control to help achieve the results. We need. Despite the adverse conditions beyond our control.
In high-price markets, we balanced growth with improving the balance sheet. In today's lower price landscape, we are prioritizing debt reduction. I say this to reassure our stockholders that Ring's management team and board of directors are unwavering in this regard.
Even if all prices rise to higher than anticipated levels later, this year, we will not significantly change our Capital spending plans and will retain our Capital discipline. If we are fortunate to experience higher oil prices later, this year, we will capture the windfalls and apply them to reducing debt with that. We will turn this call over to the operator for questions, operator.
Thank you. We will now begin the question and answer session.
To ask a question. You may press star then 1 on your telephone keypad. If you're using a speaker-phone, please pick up your handset before pressing the keys.
if any time your question has been addressed and you would like to withdraw your question, please press star then 2
At this time, we will pause momentarily to assemble our roster.
In your first question comes from Jeff Robertson. With water tower research, please go ahead.
Thank you. Good morning.
Paul, good morning, starting with the stock price. Um, you've reported good results on the assets and, and underlying production and favorable cost trends.
Uh, including the lime rock assets that were closed. At the end of the first quarter, the stock is underperforming. Uh, some of your peers. Can you just share your thoughts on how the stock is perform has performed? And what you think might be might be uh, causing that performance?
I don't think I was ready to be hit right off the bat with that 1. But uh, yeah, that's a difficult answer. Uh, question to answer, uh, primarily from the standpoint. There's a lot of uncertainty associated with what affects stock prices. Um, as you know, there's a lot of things that impact, um, you know, a public oil and gas companies, uh, stock price.
Um, a lot of those are within our control; a lot of those are not within our control. Uh, the things that are not within our control, you know, are oil prices. But those...
The impact of all price typically applied to ring very similarly as a fly to other. So that's not really a distinguishing issue. Um, uh, but in my opinion, typically the greatest differentiator between, you know, anyone companies, uh, stock price performance and
Uh, their peer group, uh, really goes down to those things that are within the company's control. And so, I think 1 of the easiest issues to point out and something that we've heard from our shareholders, is our debt and our leverage ratio, uh, ring, as you know, is at the higher end of our peer group.
Uh company is at the lower end of that uh that peer group tend to trade at a slightly higher premium uh based on our interpretation of the available data. Um, other things you can point to is our size and scale again ring is at the lower end of that peer group and uh based on our observation of the of the data companies at the higher end tend to trade at a slightly higher premium.
However, there are several other attributes.
That ring has and I call these, uh, distinguishing attributes that really set us apart. And uh, if you look back historically, we have performed very handsomely operationally and also financially. And so some of these um, distinguishing attributes. So let's just talk about something, you know our Reserve Life. If you go to our corporate presentation on page 8,
You know, ring has a longest reserved life of our peer group. The meeting is 11.1 years and ours is 18.7 years, you know, long life reserves, they help improve our sustainability and manage the risk of changing oil and gas prices over the long term.
Another attribute. Our PDP bass production declined. Rate ring has a second low as in a 10 company period. Uh, comparison. It's an important metric that helps reduce the capital intensity required to maintain our production levels and the liquidity was our banks. So that's a real important issue. Uh, other things, you know, are higher uh, operational ownership allows us to control our portfolio. The higher net revenue entry is lead to higher margins and profitability higher percentage oil. Mix in the product uh, High higher oil percentage in our product. Mix is important just simply because permanent basing companies are challenged getting our natural gas out of the Basin and sold at a profit.
um, and so
Uh all of this leads to many of these things lead to something else that's pointed out on on. Um,
On page 9 of our corporate deck. Basically, our higher operating margins, the higher operating margins, uh, leads to higher profitability for Boe and allows the company to better withstand the risk of lower oil prices. So,
so, all of these things would
A minimum trading in the middle of our peer. If not at the higher end of our peer peer group and so um, so what's different? Yeah, I I know the point you're getting to if you if if many of our shareholders may recall that not very long ago in June uh Seeking Alpha article actually came out and pointed out what I believe is a is a is a significant issue and that is the selling pressure that our company has had over the last few years. Uh if you go back to our corporate presentation, go into the appendix on page 30. We have a chart in there that shows a ring energy of historical price performance since January of 2022 to the present and we also put on that plot oil prices. And if you look at that chart and the annotations, uh, what we have done is we've annotated all of the things that I believe have had a significant impact on our, on our stock price.
And all of those things are basically associated with adverse or or high levels of selling pressure against our stock. So if you go back to uh the second quarter of 2022 on that chart, you can see that
March along, you can see, they continued that pressure against our stock.
And then we got tired of the the the effect on our stock during those times. And so if you go back to the second quarter of 2023, we negotiated with the remaining warrant holders uh and and got them to convert those shares and and and so about the time when those shares were sold into the marketplace um and we were done with the warrant, the effect of the warrant. Uh we announced the founders deal and so if you look there in July of 2023, where we announced the founders transaction,
You can see that the market responded very handsomely to that. There wasn't the selling pressure and then what happened?
Uh uh the largest shareholder that came into uh, you know, Rings position as a result of the stronghold deal, uh, began exiting their their position. And so if you follow along that chart, you can see uh, where our large uh, shareholder began selling or continue to sell, and that selling pressure continues to this day. And so,
uh, we know that uh, the selling pressure um, has continued all the way up until uh, the most recent filing that filing occurred in June, June 13th May basically um,
uh where uh our our partner, our previous partner and largest Cheryl holder fell below the 10% threshold and so now now they're no longer required to disclose so we don't know exactly where they are now but
we believe and this is just kind of goes back to what I believe, I believe that they intend to exit their position and I believe if you look at the history prior to their last filing that they uh
Uh, they were active in the marketplace and so I don't believe they'll be very long before they're completely out. They could be potentially be out now or they could be out very soon. We just don't know. Uh, but I believe that right now. Uh, if you look at our stock price in the last, uh, you know, several months,
We've bottomed out. Um, I think, after Liberation day, when oil prices took their large drop, uh, and, uh, that pushed our stock price down below a dollar, uh, and many of, you know, that the Russell 3000 index, uh, requires that all companies or our company have a stock price above a dollar. When we fell below a dollar, uh, there was also additional selling pressure from the indexes, um, that. Um, and then and they and by selling this, our stock, we ended up um,
You know, sustaining additional selling pressure there. And so, I, I believe that you've seen that our stock price has fallen to probably the lowest level in some unforeseen event occurs. And that, uh, right now is a great time to invest. And, um, I think that is kind of a long answer to your question, uh, Jeff.
Uh, but I believe that we have been under additional and strong selling pressure against our stock now for, you know, since 2022—so close to three years.
But I think we're close to the end of that and we're about to enter a time period where we'll be free of that that selling pressure. And we'll go back to the way things were in 2021. The first half of 2022 where where we traded very close to and very measured with our operational performance and our financial performance. And so, the company is very healthy, very, very, very is very strong. We've demonstrated that our strategy allows us to weather the issues, uh, that we've seen post Liberation day. Um,
and that's really the answer to my to your question. Jeff, do you have any other questions?
I do, you talked about the, um,
Virtual natural decline of rings, asset base.
And when you take on an acquisition, like lime rock, which I think also had a had a shallower decline production base than your then existing production base.
can you talk about how you think about allocating or or taking the free cash flow that's generated from an asset like that and using it to reduce leverage and at the end of the time when you've reduced The Leverage associated with that acquisition,
You still have the barrels of production to help further deliver to the balance sheet.
Yeah, you know, a great example is, of course, we're very new into the lime rock assets, but a very good example of of what we're intending to do and uh with the lime rock assets and so far, we're on on track to achieve these same type of results, but a good example is that the is the founders acquisition.
If you uh, go back to our corporate presentation, we also have a uh a chart there that kind of summarize what we did there. Uh but the bottom line is we paid off
Period. We were at uh we had an additional 2,800 barrels a day of production which accelerates and allows us to pay down debt on uh at at a faster rate.
We're going to do something very similar here with Lime Rock. Going back to part of the question associated with the decline rates, one of the key aspects of shallow decline rates is that it reduces the maintenance capital necessary to maintain your production.
And, and allows you um to to uh, to to grow more Capital efficiently. And uh, and so
Overall, uh, there's a lot of similarities between Founders and lime rocks. Some of the attributes that actually makes uh Lime Rock a little bit more attractive, is the fact that they're the proximity of those assets. Uh, to our existing operations there, in the chapter Lake Area, really, really allowed us to capture some sincere, uh, synergies. Uh, many of those synergies are reflected in this quarter's lower than expected. Uh, lease operating expenses and and I got to tell you the hats off to the operating team for all of that. Sean Young and the team did a great job of integrating those assets. Um, and, and finding ways to reduce costs, uh, that not only affected those assets, but affected all of our, uh, operations in that area. And so, I hope I've answered your question there, Jeff.
Yeah, it's just last week to, uh, uh, on cost all the, the cost synergies. You're talking about, they're very, they're very sticky, right? So they
You'll be able to maintain those if, if things get more active out there.
Oh yeah. I mean, uh, when you when you talk about reducing the operating staff by 50%, you're talking about a significant reduction in LOE
Uh, and the field staff salaries.
Generally, uh, is at the top of the Ledger in terms of the most costly uh, operating expenses, uh, for your wells. And so when you can do that type of a thing, it's it's it's it's it's it's huge and it's also sticky because that's that stays with you matter of fact.
And I can ask Sean to kind of elaborate a little bit more on that. But, uh, you know, we're, we're as a result of changing the Technologies as, as a result of the integration of assets and, and then challenged ourselves on on new ways, to operate in more efficient ways to operate, uh, we're applying some of the learnings that we had their integrating lime rock into those that area to our other areas in terms of improving the efficiencies. Oh, there's something you want to say there, Sean.
Yeah, no. No to your point, um, as Paul pointed out, you know, by reducing the operating staff. I mean, obviously going forward that's going to that's going to be a continued savings. Um, but we're also looking at some other uh, other opportunities there um and have identified a number of things that were not quite realizing yet. Um, so hope to hope to be able to share those in the future as, as we actually realize those cost savings going forward. Um and a lot of it has to do with just the synergies of of having uh you know, an operation right next door, where we're uh we're already uh able to take take advantage of some size and scale their that we can just bleed over into the lime rock assets and take advantage of those savings. So uh again more to come on that.
Super.
Thank you.
And your next question comes from poor fraught with Alliance Global Partners please go ahead.
hey um, good morning Travis, could you walk me through the difference between
Um your you know, your adjusted cash flow of, call it 25 million and The Debt Pay down its 12 million.
Sure, uh, good morning toe, that's a a great question. Uh, the biggest part of that, well, all of it was changes in working capital. Uh, the biggest part was the investment. We made in the credit facility for the next 4 years. So um, our deferred financing costs. Uh, if you guys look at page 9 of our earnings release, you can kind of see the changes to working capital there and other things, but that was about 5.4 million dollars of the difference. Um, and when we closed the old deal and moved to the new 1, um, we also brought 4 to about 3 million dollars in interest that would have otherwise been due next quarter. Um, we also had an increase in inventory of about 2 million dollars, um and that was partially due to the pullback that we had. We already had that pipe on the way. Uh so the good news is um with that we're going to have less cash interest paid next quarter, and less money spent on our inventory since we've already paid that amount. Uh, there's also about a million dollar increase in accounts.
Also cache will realize next quarter. So, all that being said, even though there was a a you know, difference between the 2 that should reverse, uh, we should see the benefits of those going into Q3.
And that sort of leads into the next question. Just looking at the second half, you know, adjusted free cash flow. It looks like you could come into the range of, you know, call it $20 million to $45 million.
In the context of your targeted debt reduction for the year or even for the second half.
Can you just sort of give us some flavor for how much debt you might be able to pay off over the second half of the year or whether you have a targeted year-end debt? Um level
I'll I'll I'll do the first stab at that and I'll turn it over to Travis. Um we don't have internal debt reduction targets yet.
so,
1 of the
More disappointing things, I think.
A release that I I believe there are some uh, out there that would like to see is pay down more debt. But we we incurred those, uh, special circumstances we talked about. Um, but many of those circumstances will not be there. Uh, in the third quarter and and product prices have continued to hang in at the higher end of the $60 range, uh, so far this quarter and so,
Um I uh say this with a little bit of trepidation in in caution, I believe that we can exceed what we paid down this quarter next quarter. Uh, but to what degree I'd I'd hate to stand out and and travel I know we work the models quite often. I don't know if there's, uh, a range or any kind of a additional information. You want to throw in there? Um, well if we if we go to 50 you know it's 1 story. If we go to 75, that's another. Um so we'll call that between 20 and 45 million maybe um that we could potentially pay down.
So we're hoping for 75 to get that that lower but um it's hard. We don't have a hard target uh that we've come out with yet for for debt reduction goal by the end of the year. I do believe it's safe to say though that we can we can exceed The Debt Pay down next quarter uh that we paid this quarter.
Yep. And as Travis pointed out, working capital is going to be favorable this coming quarter and/or the next two quarters relative to Q2.
Paul, you talked about, you know, Warburg selling um,
You don't really know where you are right now but, you know, I think 1 of the good things, maybe it's obvious to everyone but they're under 10% now. So they won't be constantly filing.
A form for showing the, you know, Relentless sales that you saw sort of, from the middle May until, you know, the middle of June.
So that potentially is a, you know, a positive from a standpoint of seeing less headlines as far as the form for filing, correct.
That is correct.
Uh, they will.
Be required to make a u, a quarterly, uh summary I guess of their stock positions. So uh that will be due sometime this uh, this month for the prior quarter.
And so it'll be interesting to see, uh, but that'll be basically reflective of of of how they exited June. And so there's been a lot of time since then. Um, you know, uh,
Having been at 1 time, our largest shareholder and had 2 members on our board. They were a great partner. We learned quite a bit from them. They contributed quite a bit to our company and they were a great partner. Uh, I don't know why, uh, they uh, uh exited, um, our or in the process of exiting our position. Uh but it's interesting to know that they also exited
Uh, quite a few other uh, energy firms. So it was nothing to do with us. Uh, I think it was more to do with something internally that we're not aware of and I can't speak for her. But uh I I do personally believe that they intend to completely exit our position and then I believe we're very close to a point in time where they're that selling pressure will go away and then and then, uh, no more excuses from our standpoint. We'll be, we'll we'll trade. I hope uh, more to measurably with our operating performance and our financial performance. And if you go back and look at our performance over the last 4 and a half years, uh, you know, ever since uh, Co
And and I believe we have a winning strategy. It's not a sexy strategy, it's basically a strategy that was here with the prior management team. Uh, we will find it some but it's a tried and true strategy that doesn't doesn't uh get rich overnight. It's nose against the grindstone and you continue to build value over the long term. And that's what we're doing here at ring and, uh, we believe that, uh, we have a lot of growth to pursue in the future uh, at current prices. It makes growth challenging. Um, but um, I think we've successfully manage that in the past when oil prices were higher so we'll see how things go. But, uh, great question, Paul, you have any other, I have another question.
Um no, that's it for me.
Um, maybe I'll come back. If there's another question, come back in the queue, but I'll leave it at that for now. Paul, thank you so much.
Hey, thank you, Paul.
In your next question, comes from no parks with 2 of your brothers. Please go ahead.
Hi, good morning.
Hey, good morning. No.
Um, you know, um, and I apologize if you if you made me touched on this earlier. But, um, uh, any, um, any updated thoughts, especially I'm thinking about with the, uh, the lime rock Assets in the portfolio. Now on, um, pursuing alternate Horizons, uh, beyond the, the San Andreas. Um,
Just given, of course, everything that's happened, geo-steering and so forth, and, you know, recent years.
Yeah, that's a really good question. And and as we pointed out, when we made the lime rock acquisition, um, that acquisition included,
Uh, lands, uh, that expose us to other emerging plays that we're watching very carefully, you know, 1 of those would be the Barnett. Um, and that would be in the middle and Farms area of the acquisition. We just closed last quarter. Um,
and so other operators are active. Uh, it is our, um, opinion based on our analysis, that those Wells, don't carry the same economic, uh, return as do the wells that we are focused on is such as a St. Andrews, horizontal Wells, and both Yoakam and Andrews County, and also, uh, many of the vertical Wells that were pursuing an actor and, and crane County.
Uh, uh, but they are very interesting. They, they contain large amounts of resource, uh, as I shared last quarter, uh, um, you know, after we made that acquisition, we had several parties. Uh, inquire. Uh, we don't know what we'll do now at higher prices, they become, uh, very economic. And so we could potentially drill them or or those assets could find themselves in the hands of somebody else, uh, who values them higher than we do.
Uh, we haven't made that decision yet, but we are studying that now. Uh, that's just one interval. Um, I believe that as technology continues to march down the road,
Uh, we believe many of the areas in our Southern operations that have historically been dominated by vertical wells.
We may be exposed to horizontal drilling. As a matter of fact, this quarter we're actually testing an interval.
Uh, horizontally in the south.
Uh, we'll talk more about that as we get results. Um, and we have other operators in the South that, uh,
that uh, operate very close to us, that have had a very handsome success, uh, converting over from vertical to horizontal and so we'll see where technology goes, uh, 1 of the things that we've done, uh, uh, is, uh, we've done an inventory of all of these other different Horizons, uh, that you mentioned
Uh there are several that have significant uh potential uh that potential comes to us for virtually no cost other than the cost to test it and drill it and put it online uh because we already own the acreage. And so yeah we're really excited about the potential uh of some of these other zones uh uh and I'm looking at Alex dies over here I don't know if you Alex do you have any more to to add there?
Now, um, I guess, just in general, we've been testing some of these zones now for for probably a year or so, we've been trying to test for recomp completions right. Exactly vertically. And then, uh, and then we're also trying to learn from our offset operators and, uh, and we're also probably participate on a non-op basis too. So, we're trying to learn as much as possible and trying to, you know, once we get back to deploying more capital,
Is is a slowed down because of where oil prices are?
Because we're prioritizing debt reduction, uh, but I believe and uh, when we get Beyond this price environment, because I really do believe that long term will be back into that, seventy 5 price range. And and at that price range, we can afford to to uh test some of these intervals. Uh more frequently and and uh and but it is a part of the future for ring energy. Good, great question.
Great. Thanks a lot.
And then next question is a follow-up from Jeff Robertson, with water tower research. Please go ahead.
Paul or Travis, I'm just curious. Is there anything going on in the midstream?
World that could have any impact on your gas parts realizations and NGO realizations.
If you look at next year or two,
Well, um, yes, there are, um, I think, uh, know the department base and is demonstrating something very clearly, at least to me. Anyway, um, the takeaway capacity, service in the permanent base and, uh, tends to get filled up pretty quickly, uh, whatever it is. Uh, the most recent 1 was the matter horn Express. Um, it's my understanding that there's still, uh, more capacity to be made available in the matter, horn Express. And I believe that that will help uh, with, uh, price differentials.
Uh there are also several other pipelines that that are not uh imminent uh that are on the books to be that are being considered. Um and so all of this will help
Um but uh you know in the foreseeable future uh the infrastructure is still going to be limited and uh and and The Operators like ring energy will have to fight for that space. And so the discount to Henry Hub is is uh, is is going to continue to be larger than we'd like we got to work. Um, I think you've seen, you know, from other operators and and just
There's a trend out there where people are pulling back on capex. So, if there's less drilling in our area, that means less associated gas going through that pipe. That really could help with our differentials as well.
Um that's a good point. Obviously, it's not something we hope for because we'd rather have higher higher oil prices. Um but if we can get a more meaningful Revenue stream from those the gas and NGL and we would obviously be very impactful to the company.
Sure, what?
Thanks for having us.
This concludes our question and answer session. I would like to turn the conference back over to Paul McKinney, chairman and CEO for any closing, remarks.
Thank you, Michael and beha on behalf of the entire team and board of directors. I want to once again, thank everyone for listening and participating in today's call and I hope you have a great rest of your day. Thank you very much.
The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.