Diamondback Energy Inc (FANG) 2024 Q1 法說會逐字稿

Good day, and thank you for standing by. Welcome to the Diamondback Energy First Quarter 2024 Earnings Conference Call. (Operator Instructions) Please be advised that today's conference is being recorded. I would now like to hand the conference over to Adam Lawlis, VP of Investor Relations. Please go ahead.

美好的一天，感謝您的支持。歡迎參加響尾蛇能源 2024 年第一季財報電話會議。 （操作員指示）請注意，今天的會議正在錄製中。我現在想將會議交給投資者關係副總裁 Adam Lawlis。請繼續。

Thanks, Jose. Good morning, and welcome to Diamondback Energy's First Quarter 2024 Conference Call. During our call today, we will reference an updated investor presentation and letter to stockholders, which can be found on Diamondback's website. Representing Diamondback today are Travis Stice, Chairman and CEO; Kaes Van’t Hof, President and CFO; and Danny Wesson, COO. During this conference call, the participants may make certain forward-looking statements relating to the company's financial condition, results of operations, plans, objectives, future performance and businesses. We caution you that actual results could differ materially from those that are indicated in these forward-looking statements due to a variety of factors. Information concerning these factors can be found in the company's filings with the SEC. In addition, we will make reference to certain non-GAAP measures. The reconciliation of the appropriate GAAP measures can be found in our earnings release issued yesterday afternoon. I'll now turn the call over to Travis Stice.

謝謝，何塞。早安，歡迎參加 Diamondback Energy 2024 年第一季電話會議。在今天的電話會議中，我們將參考更新的投資者介紹和致股東的信函，這些資訊可以在響尾蛇的網站上找到。今天代表 Diamondback 的是董事長兼執行長 Travis Stice； Kaes Vanât Hof，總裁兼財務長；和首席營運長丹尼·韋森 (Danny Wesson)。在本次電話會議期間，與會者可能會就本公司的財務狀況、營運績效、計畫、目標、未來績效和業務做出某些前瞻性陳述。我們提醒您，由於多種因素，實際結果可能與這些前瞻性聲明中所示的結果有重大差異。有關這些因素的資訊可以在該公司向 SEC 提交的文件中找到。此外，我們也將參考某些非公認會計準則措施。適當的公認會計原則措施的調節可以在我們昨天下午發布的收益報告中找到。我現在將把電話轉給 Travis Stice。

Thank you, Adam, and I appreciate everyone joining again this morning. I hope you continue to find the stockholders' letter that we issued last night in an efficient way to communicate. We spend a lot of time putting that letter together, and there's a lot of material in that. So operator, with that as a brief introduction, would you please open the line for questions?

謝謝你，亞當，我也謝謝大家今天早上再次加入。希望大家繼續找到我們昨晚發出的股東信，以高效率的方式溝通。我們花了很多時間來整理這封信，裡面有很多資料。接線員，作為一個簡單的介紹，請打開電話提問好嗎？

(Operator Instructions) Our first question comes from the line of Neil Mehta of Goldman Sachs.

（操作員指示）我們的第一個問題來自高盛的 Neil Mehta。

A lot of good stuff in the letter. Two quick follow-ups. First, just on natural gas. You spent a lot of time talking about some of the steps you've taken to mitigate some of the softness that we're seeing in Waha pricing. Can you spend more time on that? And as it relates to that, how do you think about the timing of debottlenecking Permian gas?

信中說了很多好話。兩次快速跟進。首先，僅使用天然氣。您花了很多時間談論您為緩解我們在娃哈哈定價中看到的一些疲軟狀況而採取的一些措施。你能花更多時間在這上面嗎？與此相關，您如何看待消除二疊紀天然氣瓶頸的時機？

Well, from a macro perspective, I think we've been pretty clear that we're going to continue to need pipes being built about every 12 to 18 months out of the Permian to accommodate the associated gas that goes along with just 6 million barrels a day that we produce out here. Natural gas is right now being almost like a waste product, and we've got it. This -- when matter workup zone this fall, we'll see some of that reverse. But Kaes, do you want to give them some description of what we're doing in the rest of the gas?

嗯，從宏觀角度來看，我認為我們已經非常清楚，我們將繼續需要大約每 12 到 18 個月在二疊紀地區建造一條管道，以容納僅 600 萬桶的伴生氣我們在這裡製作的一天。天然氣現在幾乎就像是一種廢物，而我們已經解決了。當今年秋天進入物質處理區時，我們會看到一些相反的情況。但是凱斯，你想給他們一些關於我們在其餘氣體中所做的事情的描述嗎？

Yes, Neil, I mean, this will be long term, we want to be able to contribute to more pipes. We've done that in the last couple of years with commitments on Whistler and Matterhorn. We've relinquished taking kind rights in other areas to commit to other pipes that were built. As Travis said, we just need to do more. And I think with our size and scale and balance sheet, we should be taking a leadership position on these new pipes. We've talked to a lot of people that are working on them today, and it seems that there are projects in the works that will help the bottleneck past the end of this year. But as we control or have the ability to control more gas flows on our side, as contracts roll off, et cetera, we're going to keep pushing on more pipes and more markets out of this basin.

是的，尼爾，我的意思是，這將是長期的，我們希望能夠為更多的管道做出貢獻。在過去的幾年裡，我們已經透過對惠斯勒和馬特洪峰的承諾做到了這一點。我們放棄了在其他領域的善意權利，轉而致力於建造其他管道。正如特拉維斯所說，我們只需要做得更多。我認為，憑藉我們的規模和資產負債表，我們應該在這些新管道上佔據領導地位。今天我們已經與許多正在研究這些問題的人進行了交談，似乎有一些項目正在進行中，將有助於克服今年年底的瓶頸。但是，隨著我們控製或有能力控制更多的天然氣流量，隨著合約的結束等，我們將繼續推動更多的管道和更多的市場離開這個盆地。

Yes. And then the second is capital efficiency. You talked about the 10% improvement that you're expecting per lateral foot. So just talk about what you're seeing real time in terms of deflation. And then also, what are those the next steps in terms of driving your cost structure lower as we think about efficiency of fleet?

是的。第二個是資本效率。您談到了您期望每側腳改善 10%。因此，請談談您在通貨緊縮方面即時看到的情況。然後，當我們考慮機隊效率時，降低成本結構的下一步是什麼？

Well, I think the deflationary pressures we continue to see in the Permian are being driven by the decline in the rig count and the decline in the completion crew count. Those will be tailwinds for us as we look through the rest of this year. But also without regards to those deflationary impacts, we continue to push the envelope on our D&C operations where we're getting -- I think we averaged almost 13,000 feet for the quarter this year, and we continue to get these wells drilled faster and then our completion crews continue to push the envelope on the number of lateral feet that are completed in a 24-hour period. So we're working on the numerator and the denominator of capital efficiency and really like the way the rest of the year sets up for us.

嗯，我認為我們在二疊紀繼續看到的通貨緊縮壓力是由鑽機數量下降和完井人員數量下降造成的。當我們展望今年剩餘時間時，這些將成為我們的順風車。但也不考慮這些通貨緊縮的影響，我們繼續挑戰我們的 D&C 業務的極限，我認為今年該季度我們的平均鑽深接近 13,000 英尺，並且我們繼續更快地鑽探這些井，然後我們的完工人員繼續挑戰24 小時內完成的側腳數量的極限。因此，我們正在研究資本效率的分子和分母，並且非常喜歡今年剩餘時間為我們設定的方式。

Our next question comes from the line of Arun Jayaram of JPMorgan Securities LLC.

我們的下一個問題來自摩根大通證券有限責任公司的 Arun Jayaram。

Travis, you and the team had highlighted up to $550 million of annualized synergy capture in the transaction in the Midland Basin, including a 150-foot decline. And do you see any cost in the Midland Basin to that $600 million to $650 million range? Maybe a follow-up to Neil's question, but where are you seeing kind of leading-edge cost today in the Midland Basin as you continue to push those lateral links a bit longer?

Travis，您和您的團隊強調了米德蘭盆地交易中的年化協同效應高達 5.5 億美元，其中包括 150 英尺的下降。您認為米德蘭盆地的成本是否達到 6 億至 6.5 億美元之間？也許是尼爾問題的後續，但是當您繼續將這些橫向連接延長一點時，您今天在米德蘭盆地看到的領先成本在哪裡？

Yes, this is Kaes. I think the combination of those longer laterals, 12,000-plus with some efficiencies on the completion side that we probably weren't expecting going into the year as well as some softening on the service side makes us feel pretty good that we're in the lower half of that $600 to $650 a foot in the Midland Basin. As you know, 90% of our capital is being allocated to that basin. So with those costs trending in the right direction, I think on a real-time basis, closer to $600 a foot, we feel really, really good about our plan this year as well as carrying that momentum into a Q4 close. The Endeavor deal and into 2025. Very clearly, we laid out some strong synergy targets and a very strong capital-efficient 2025 plan, and we still feel very, very confident in that plan.

是的，這就是凱斯。我認為，這些較長的支線，超過 12,000 條，加上完工方面的一些效率（我們可能沒有預料到今年會出現）以及服務方面的一些軟化，讓我們感覺非常好，因為我們處於米德蘭盆地每英尺600 至650 美元的下半部分。如您所知，我們 90% 的資本都分配到了該盆地。因此，隨著這些成本朝著正確的方向發展，我認為在實時基礎上，接近每英尺 600 美元，我們對今年的計劃感到非常非常滿意，並將這種勢頭帶入第四季度末。 Endeavour 交易並持續到 2025 年。

Great. Kaes, looking at the quarter, you didn't really -- how many activity in terms of [TILs] in the Delaware Basin. Can you give us some thoughts on the Delaware program? I know it's 10% of the program, but what's your thoughts on the Delaware as we think about moving on into the back half of this year and into next year?

偉大的。 Kaes，看看這個季度，你並沒有真正了解特拉華盆地的 [TIL] 活動有多少。您能給我們一些關於特拉華州計劃的想法嗎？我知道這是該計劃的 10%，但是當我們考慮進入今年下半年和明年時，您對特拉華州有何看法？

Yes. Listen, there's still a place for the Delaware program. There are still some really good projects coming up in Q2. I think we have a project in that Romeo area, Northern East County that's going to be very good. I think generally, with large pad development, you're going to see pockets of development in the Delaware rather than consistent development because we want to go over there and complete multiple wells, multiple pads in a row and keep that capital efficiency high versus the Midland Basin where 3 or 4 simul-frac crews are going to be running at all times.

是的。聽著，德拉瓦計畫還有一席之地。第二季度仍然有一些非常好的項目出現。我認為我們在東北縣羅密歐地區有一個非常好的項目。我認為，一般來說，對於大型墊開發，您將在特拉華州看到零星的開發，而不是持續的開發，因為我們希望去那裡完成多口井、連續的多個墊，並保持較高的資本效率。

Our next question comes from the line of David Deckelbaum of TD Cowen.

我們的下一個問題來自 TD Cowen 的 David Deckelbaum。

Maybe this question is for both of you guys. But considering the positioning a bit early with the debt that you raised earlier this month, now the expectation that the deal will close at the end of the year with Endeavor. You talked about kind of the synergy expectations in the last series of questions. Can you give us an update on how you're thinking about that initial sort of noncore sale asset target and maybe some of the updated timing around those thoughts, considering the market's changed a bit, especially around the cash consideration portion?

也許這個問題是針對你們兩個的。但考慮到本月稍早籌集的債務的定位有點早，現在預計該交易將在今年年底與 Endeavor 完成。您在上一系列問題中談到了協同效應期望。考慮到市場發生了一些變化，特別是在現金考慮部分，您能否向我們介紹一下您對最初的非核心出售資產目標的看法，以及圍繞這些想法的一些最新時機？

Yes. I think what's changed is just timing, right? I think the projects we see as noncore asset sales or the asset sales to subsidiaries we have is still the same. Endeavor has a really good midstream business that would fit well with our midstream JV. They have a significant mineral business that I think is going to be a game changer for Viper if those 2 businesses are combined. And our strategy to execute on those trades has not changed. It's just been pushed out to the right. So on top of that, there's an $8 billion cash consideration, that continues to be worked down with free cash flow between sign and close.

是的。我認為改變的只是時間，對嗎？我認為我們所看到的非核心資產出售或向我們擁有的子公司出售資產的項目仍然是一樣的。 Endeavor 擁有非常好的中游業務，非常適合我們的中游合資企業。他們擁有重要的礦產業務，我認為如果這兩項業務合併，這將改變 Viper 的遊戲規則。我們執行這些交易的策略並沒有改變。它剛剛被推到了右邊。因此，除此之外，還有 80 億美元的現金考慮因素，該考慮因素將繼續透過簽署和交割之間的自由現金流來減少。

I think that just means, we have to pony up less cash at close in Q4. And we raised the money a couple of weeks ago because we were preparing to potentially close the deal as early as today. Unfortunately, the deal has been pushed out due to regulatory review, but we had to be ready to fund the deal, and that's where we were. Fortunately, the bond deal was pretty well-timed. We're actually earning very minimal negative carry on the cash that we have sitting at the banks today, and we'll be ready to use it when we close in a couple of quarters.

我認為這只是意味著，我們必須在第四季度結束時支付更少的現金。我們幾週前就籌集了這筆資金，因為我們準備好最早今天就完成交易。不幸的是，由於監管審查，該交易已被推遲，但我們必須準備好為該交易提供資金，而這就是我們的處境。幸運的是，債券交易的時機非常好。事實上，我們今天存放在銀行的現金的負結轉額非常小，幾個季度後我們就可以使用它了。

Maybe just to follow up a little bit more on just the gas pipeline side. Just for my own edification, just some clarity. Just you highlighted you didn't have any issues with egress. You have Matterhorn coming online in the third quarter. Is there a point as you look forward, where you anticipate egress issues? Or is this more appearing to be just more proactive to get involved with taking on firm capacity in future pipelines? Do you need to take a more active role beyond that?

也許只是在天然氣管道方面進行更多跟進。只是為了我自己的啟發，只是一些清晰度。只是您強調了您在出口方面沒有任何問題。馬特洪峰將在第三季上線。展望未來，您是否會在某個時刻預期出現出口問題？或者這似乎只是更主動參與未來管道的固定產能？除此之外，您是否需要發揮更積極的作用？

Yes. Well, I mean, we're facing them right now, egress issues, right, not on the physical side, but it's really on the price side. So I think if we can remove the pricing aspect of pricing modules in Waha versus pricing them further downstream and just paying a fixed fee on the pipe. That to us is a risk mitigation strategy that makes sense for Diamondback shareholders. So I think we see the gas forecast continuing to increase. If you do look back the big public third-party services and what they thought gas production was going to be in 2024, they've all been wrong. So it's always been more gas sooner. And so for us, we need to handle that physically where we can. And with our balance sheet and size and scale, we can sign those 10-year deals because we know we're going to be around to produce for a very, very long time.

是的。嗯，我的意思是，我們現在面臨出口問題，對吧，不是在物理方面，而是在價格方面。因此，我認為我們是否可以取消瓦哈定價模組的定價方面，而不是對下游定價並僅在管道上支付固定費用。對我們來說，這是一項對響尾蛇股東有意義的風險緩解策略。所以我認為我們看到天然氣預測繼續增加。如果你回顧大型公共第三方服務以及他們對 2024 年天然氣產量的預測，你會發現他們都錯了。所以總是更早提供更多的汽油。所以對我們來說，我們需要盡可能以物理方式處理這個問題。憑藉我們的資產負債表、規模和規模，我們可以簽署這些 10 年期協議，因為我們知道我們將在很長一段時間內進行生產。

Our next question comes from the line of Scott Hanold of RBC Capital Markets.

我們的下一個問題來自加拿大皇家銀行資本市場的 Scott Hanold。

I'm just going to stick on the gas team as well because it is very topical, but it sounds like, and just correct me if I'm wrong, you guys feel good about your development program on a Diamondback stand-alone basis as well as with Endeavor with gas capacity, at least for the foreseeable future and just confirm that's correct? And if you could also maybe opine on just broader Permian in general, do you expect other operators to see some physical constraints not being able to get their gas out and potential shut-ins related to that?

我也會堅持天然氣團隊，因為它是非常熱門的話題，但聽起來，如果我錯了，請糾正我，你們對響尾蛇獨立的開發計劃感覺良好，因為以及具有天然氣能力的奮進號，至少在可預見的未來，只是確認這是正確的？如果您也可以對更廣泛的二疊紀盆地總體發表意見，您是否認為其他運營商會看到一些無法排出天然氣的物理限制以及與此相關的潛在關閉？

Yes, Scott, we're 100% confident in our plan. I think we have a lot of visibility. We have more and more physical space coming our way. Every molecule is moved to date. I don't like the speculation blame game in the Permian about who's going to be able to move or not. I'm focused on Diamondback, and we're going to be in really good shape.

是的，斯科特，我們對我們的計劃有 100% 的信心。我認為我們有很多知名度。我們有越來越多的物理空間。每個分子都被移動到最新的位置。我不喜歡二疊紀關於誰能夠移動或不能移動的猜測指責遊戲。我專注於響尾蛇隊，我們將會處於非常好的狀態。

Okay. Fair enough. And then my next question is on stock buybacks. Obviously, it sounds like it's going to be a little bit more tempered until the deal closes with Endeavor, but can you give us your thought process on buybacks post-merger and how you think about the intrinsic value of the combined company? And what mid-cycle price makes sense to underpin that?

好的。很公平。我的下一個問題是關於股票回購。顯然，在與 Endeavor 的交易完成之前，聽起來似乎會更加溫和一些，但您能否向我們介紹一下您對合併後回購的思考過程以及您如何看待合併後公司的內在價值？什麼樣的周期中期價格可以支撐這一點？

Yes. I think philosophically, part of the move back to 50% of free cash flow returned every quarter allows us to build more cash, pay down debt faster, but also make the bigger bets on buybacks, right? In a single quarter, if you're having to distribute 75% of your free cash flow, you don't get to really make the big bet on the buyback at the right time. And so this flexibility will allow us to do that. Clearly, we've been a little limited on buybacks since announcing the deal. I would expect that to stay about the same here in the second and third quarters depending upon the market.

是的。我認為從哲學上講，每季返回 50% 的自由現金流可以讓我們累積更多現金，更快地償還債務，同時也可以在回購上做出更大的賭注，對嗎？在一個季度內，如果您必須分配 75% 的自由現金流，那麼您就無法在正確的時間真正在回購上下大賭注。因此，這種靈活性將使我們能夠做到這一點。顯然，自從宣布這筆交易以來，我們的回購受到了一些限制。我預計第二季和第三季的情況將保持不變，具體取決於市場情況。

If we see some weakness, we're going to step in and support the stock. But longer term, we want to make the 9-figure, 10-figure bets on buybacks at the right time, and that's the flexibility we want on capital return. I think we still see kind of mid-cycle in the $60 to $70 range. I think we were firmly 60 for a long time. We're probably closer to $70, $20 and $2 or $3 gas. And in the combined business, you look at what we have with Endeavor, there's a significant amount of inventory and a lot of NAV accretion. So -- and probably a lower combined cost of capital. So I think we feel like we can raise that buyback up a little bit, but we're probably going to be cautious until we close.

如果我們看到一些疲軟，我們將介入並支持該股票。但從長遠來看，我們希望在正確的時間進行 9 位數、10 位數的回購，這就是我們想要的資本回報的靈活性。我認為我們仍會看到 60 至 70 美元範圍內的中期週期。我想我們已經60歲了很長一段時間了。我們的汽油價格可能接近 70 美元、20 美元和 2 美元或 3 美元。在合併後的業務中，你看看我們在奮進號上擁有的東西，有大量的庫存和大量的資產淨值增值。因此，綜合資本成本可能較低。因此，我認為我們可以稍微提高回購額，但在交易結束之前我們可能會保持謹慎。

Yes. Just to clarify a couple of points. Just broadly speaking, how much accretion do you all feel Endeavor added? And can you give us a sense of like when you think about cost of capital, like what were you kind of thinking before when you did intrinsic value. Was it like a 10% kind of flat? Or do you get a little bit more scientific with that?

是的。只是為了澄清幾點。簡單來說，你們覺得奮進號增加了多少？當您考慮資本成本時，您能否給我們一種感覺，就像您之前考慮內在價值時的想法一樣。是不是像 10% 的公寓一樣？或者你對此有更科學的了解嗎？

Yes. We've always been a little higher than 10%. I think in after-tax [PV-12] felt like at a mid-cycle price, felt like a very conservative price to buy back shares. And that also makes sure we don't get trapped into a positive feedback loop of buying back shares all the way to the top. So I think an after tax, 12% rate of return in this business is a really good rate of return at a mid-cycle price, and that keeps you in a good spot through the cycle.

是的。我們一直略高於 10%。我認為稅後 [PV-12] 感覺像是週期中期的價格，感覺像是回購股票的非常保守的價格。這也確保我們不會陷入回購股票一直到最高點的正向回饋循環。因此，我認為該業務的稅後 12% 回報率在周期中期價格中確實是一個不錯的回報率，這可以讓你在整個週期中保持良好的位置。

Our next question comes from the line of Roger Read of Wells Fargo Securities.

我們的下一個問題來自富國銀行證券公司的羅傑·里德。

Yes. I'd like to come back on the, let's call it, efficiencies and lower costs. Obviously, some part of that, as you mentioned, was service competition, rig on rig, crew on crew lowering costs. But if you look at the underlying improvements you cite e-fracs over a diesel frac, kind of where do you think we are in terms of running through continued efficiencies there as we, let's say, alter the equipment, maybe alter the methods of doing some of the wells and with the danger of crossing the line here to post Endeavor, kind of what you see as maybe a year or 2 out in terms of continued efficiency gains.

是的。我想回到我們稱之為效率和降低成本的話題。顯然，正如您所提到的，其中的一部分是服務競爭、鑽機與鑽機、船員與船員降低成本。但是，如果你看看你引用的電子壓裂相對於柴油壓裂的根本改進，你認為我們在持續提高效率方面處於什麼位置，因為我們改變了設備，也許改變了工作方法一些油井，還有越界的危險來發布奮進號，你認為在持續提高效率方面可能需要一兩年的時間。

Yes. Good question. We are continuing to drive costs out of the business through our operational plan and execution. On the completion side, A lot of that's going to come in the way of getting any fleets off of generated power and on to some form of grid power where we can recognize a lower energy source cost. We're continuing to try to drive days out of our execution, and we're kind of on the asymptotic slope of that efficiency gains that we are getting to a point where the fixed cost of the wells are a significant -- significantly larger portion of the cost of the well than the variable cost. So we're getting to a point where the variable costs that we're going to impact our pennies and nickels and not as much the dollars anymore and to get those large chunks, we're going to have to think about doing things differently as far as the physical plan for the wells and what we are going to consume as part of the fixed cost of the wells.

是的。好問題。我們將繼續透過營運計劃和執行來降低業務成本。在完成方面，其中許多都將阻礙任何車隊擺脫發電並轉向某種形式的電網電力，我們可以認識到較低的能源成本。我們正在繼續努力縮短執行時間，而且我們正處於效率增益的漸近斜率上，我們正​​在達到這樣一個點，即油井的固定成本佔很大一部分。因此，我們已經到了這樣一個地步：可變成本將影響我們的便士和鎳幣，而不再影響美元，為了獲得這些大塊，我們將不得不考慮以不同的方式做事至於油井的實際計劃以及我們將作為油井固定成本的一部分消耗的內容。

Roger, I give our guys some joke with them a little bit on the drilling side because they're almost to the point where they're spending more time screwing pipe together and unscreen pipe together than they are actual rotating hours and the lateral, not quite, but they keep certainly pushing the envelope. And really, if you go back to what we said during the acquisition announcement with the merger announcement with Endeavor, we talked about $150 a foot. $100 of that foot was from just simply going to a simul frac and the other $50 a foot was going to clear fluids. And really, that's what we're doing today. So we emphasized at the time. That's not a big stretch. It's just simply doing what we're doing today on a new set of assets. And in Dan's comments, we're spot on as well.

羅傑，我在鑽井方面給我們的人開了個玩笑，因為他們幾乎已經到了這樣的地步：他們花費更多的時間將管道擰在一起並拆開管道，而不是實際的旋轉時間和橫向時間，而不是確實如此，但他們確實在不斷挑戰極限。事實上，如果你回顧一下我們在收購公告中以及與 Endeavor 的合併公告中所說的話，我們談到的是每英尺 150 美元。其中每英尺 100 美元用於進行同步壓裂，每英尺另外 50 美元用於清除液體。事實上，這就是我們今天正在做的事情。所以我們當時強調。這並不是一個很大的延伸。它只是簡單地在一組新資產上做我們今天正在做的事情。在 Dan 的評論中，我們也說得很對。

Got you. So we just need somebody to come up with the next better mousetrap out there for the step functions. I appreciate that.

明白你了。所以我們只需要有人為步驟函數想出下一個更好的捕鼠器。我很感激。

Listen, Roger, one other comment on that. I mean the guys are so good on the drilling side now. They're measuring how thick the threading is between casing and on the drilling side to say, "Can I screw that pipe together half a second faster versus what I used to do." I mean it is down to the absolute second on-site to reduce those variable costs.

聽著，羅傑，另一位對此的評論。我的意思是，這些人現在在鑽井方面非常出色。他們正在測量套管和鑽井側之間的螺紋有多粗，然後說：“我可以比以前更快地將管道擰在一起半秒鐘嗎？”我的意思是，要減少這些變動成本，就必須減少到現場的絕對秒數。

Our next question comes from the line of John Freeman of Raymond James.

我們的下一個問題來自雷蒙德詹姆斯的約翰弗里曼。

Just following up on these efficiency drivers. Obviously, in the quarter, the wells that you all completed, the 101 wells, they were right in line on the lateral length of what your guidance was for the full year around that 11,500 feet. But obviously, you all point out the 69 wells that you all drilled in the Midland Basin that were significantly longer than that over $13,000 a foot, obviously, first-class problem given the capital efficiency you're seeing on these longer laterals. But should we still use that full year guide of 11,500-foot average for the year? Is that still applicable? Or should we consider that probably moving up relative to the original guide?

只是跟進這些效率驅動因素。顯然，在本季度，你們完成的 101 口井，它們與你們全年指導的 11,500 英尺左右的橫向長度完全一致。但顯然，你們都指出，你們在米德蘭盆地鑽探的 69 口井明顯長於每英尺 13,000 美元以上的井，顯然，鑑於您在這些較長支管上看到的資本效率，這是一流的問題。但我們是否仍應使用全年平均值 11,500 英尺的指南呢？這仍然適用嗎？或者我們是否應該考慮相對於原始指南可能會上升？

Yes, John. I think in the first quarter, those longer laterals were really just a function of where we were completing the wells that average lateral length of 11,500 is what we expect to see for the rest of the year.

是的，約翰。我認為在第一季度，那些較長的支管實際上只是我們完成井的位置的函數，平均支管長度為 11,500 米，這是我們預計今年剩餘時間看到的。

Okay. And then just shifting gears a little bit on the topic of, I'm trying to get a sense of like how much you are able to do sort of in advance of the Endeavor deal closing. And I know that in those initial efficiencies that you all laid out, things like, maybe pricing power supply chain, things like that weren't even necessarily priced into those initial synergies. So I'm trying to get a sense of like how much can you all do in advance in terms of negotiating with some of your service providers in anticipation of sort of a larger combined entity buying in bulk, things like that, like how much of that, if at all, can you do in advance or you just kind of have to sit and kind of wait until the deal closes to kind of get running on that stuff?

好的。然後稍微改變一下話題，我試著了解一下在 Endeavour 交易完成之前你能做多少事情。我知道，在你們提出的那些最初的效率中，諸如電力供應鏈定價之類的事情甚至不一定計入這些最初的協同效應中。因此，我試圖了解一下，在與一些服務提供者進行談判方面，你們可以提前做多少事情，以應對更大的聯合實體批量購買之類的事情，比如有多少如果有的話，你能提前做嗎？ 或是你只能坐下來等待交易完成，然後再開始處理這些事情？

Yes, John, we got to operate as separate companies until the deal closes, and those things will come to the benefits of the combined company, but certainly can't influence any outcomes until deals were closed.

是的，約翰，在交易完成之前我們必須作為獨立的公司運營，這些事情將為合併後的公司帶來好處，但在交易完成之前肯定不會影響任何結果。

Our next question comes from the line of Neal Dingmann of Truist Securities.

我們的下一個問題來自 Truist Securities 的 Neal Dingmann。

Travis, my question for you, okay, is just on the marketing side. You are looking not only from a capital efficiency, but it seems like from a takeaway, you all continue to get better and better sort of realized margin. I'm just wondering, now with the larger size, or I guess when that closes, what type of benefits will you continue to see the benefits on the back end that you've been seeing on the company? Because it seems like noticeable that a lot of your margins and all just on the marketing side continue to improve.

崔維斯，我想問你的問題只是關於行銷方面的。你不僅從資本效率來看，而且從外送來看，你們都在持續獲得越來越好的已實現利潤。我只是想知道，現在規模更大了，或者我猜當它結束時，您將繼續在公司的後端看到什麼類型的好處？因為很明顯，您的許多利潤以及所有行銷方面的利潤都在持續改善。

Yes, Neal, I mean, I think -- I don't think we're going to see much more improvement. I think it's -- for us, it's more about risk aversion, right, and having our barrels and molecules go to different, bigger markets downstream. So we have a lot of oil that goes to the Gulf Coast in Corpus and is exported. We now have a good amount of oil going to Houston feed refineries there. So I think we've kind of grown up as a company in terms of marketing. And very clearly, mistakes for May 5, 6, 7 years ago when the Permian got tight, and we're just not looking to make those mistakes again. So with our size and scale, we're going to be contributing to oil pipes, contributing to new gas pipes.

是的，尼爾，我的意思是，我認為——我認為我們不會看到更多的改進。我認為對我們來說，更多的是規避風險，對吧，讓我們的桶子和分子進入不同的、更大的下游市場。因此，我們有大量石油運往 Corpus 的墨西哥灣沿岸並出口。我們現在有大量石油運往休士頓，為那裡的煉油廠提供原料。所以我認為我們作為一家公司在行銷方面已經成長起來。非常明顯的是，5 月 5 日、6 日、7 年前二疊紀盆地緊張時所犯的錯誤，我們只是不想再犯這些錯誤。因此，憑藉我們的規模和規模，我們將為石油管道、新天然氣管道做出貢獻。

We've made some investments in gatherers and processors and many midstream investments throughout the years here that 1 made our shareholders' money on the investment side, but to protected us on the commercial side. So I'd expect that trend to continue as we get bigger.

多年來，我們對收集器和加工商進行了一些投資，並進行了許多中游投資，這些投資在投資方面為股東賺了錢，但在商業方面保護了我們。因此，我預計隨著我們規模的擴大，這種趨勢將會持續下去。

That Kaes, you're saying you'll continue to contract more of those longer-term marketing contracts then?

那個凱斯，你是說你會繼續簽訂更多的長期行銷合約？

Yes. I think our philosophy is to get our barrels to the most liquid bigger market and very clearly, selling within Midland or in the Midland market has not always been the most beneficial to our shareholders. There are pockets of time when the Midland market is very loose, but there are also periods where it gets very, very tight. So the way we see this physical marketing protection is a long-term insurance policy to make sure our barrels move to the right market.

是的。我認為我們的理念是讓我們的桶子進入最具流動性的更大市場，很明顯，在米德蘭或米德蘭市場內銷售並不總是對我們的股東最有利。米德蘭市場有時會非常寬鬆，但也有時會變得非常非常緊張。因此，我們認為這種實體行銷保障是一項長期保險政策，以確保我們的桶子進入正確的市場。

Okay. And then just quickly on project size. You all continue to do a fantastic job not only that you have the larger projects, let's call it, on average, 6, 4-well pads, things on that nature, but you seem to have the flexibility that the larger and oftentimes the majors don't on those projects. Will that continue to be sort of the standard for you all going forward on these larger projects where -- and you'll maintain that flexibility or maybe you could just hit on that briefly.

好的。然後快速確定專案規模。你們所有人都繼續出色地工作，不僅因為你們有更大的項目，讓我們稱之為平均6、4 井墊，這種性質的東西，而且你們似乎擁有更大的、通常是專業的靈活性。這是否會繼續成為你們所有人在這些更大的項目中前進的標準——您將保持這種靈活性，或者也許您可以簡單地碰上這一點。

Yes. I mean you can go on for hours about that. I mean, that ties the culture, right? And our biggest benefit at Diamondback is that we have a small company dynamic culture with a large asset base that's now growing larger. So we are going to have to make sure we maintain that gritty quick, fast-moving adaptive culture to a larger asset base. I'm fully confident that we have the exec team and employee base to both at Diamondback and Endeavor to do that. And I think these big projects, there's a lot of capital being put in the ground before first oil sometimes upwards of $250 million, $300 million, but as long as you have the ability to move crews and rigs within a quarter, within a year, keep hitting numbers, we're going to keep doing that at a larger scale.

是的。我的意思是你可以花幾個小時來討論這個問題。我的意思是，這與文化有關，對吧？我們在響尾蛇最大的好處是，我們擁有充滿活力的小公司文化和龐大的資產基礎，而且資產基礎不斷擴大。因此，我們必須確保在更大的資產基礎上保持堅韌、快速、快速發展的適應性文化。我完全相信 Diamondback 和 Endeavour 都有執行團隊和員工基礎來做到這一點。我認為這些大型項目在首次石油開採之前會投入大量資金，有時高達 2.5 億美元、3 億美元，但只要你有能力在一個季度、一年內轉移人員和鑽井平台，繼續達到數字，我們將繼續以更大的規模這樣做。

And Neal, as we built this company over the last 10 years, we've always maintained a couple of constants. One is the fact that we keep a real flat organization. And we keep a non-siloed organization as well too. And the only way that you can grow an organization and maintain that effectively is to have an unreasonable level of trust. And as we encourage our -- the Endeavor employees to come over, we're going to be demonstrating this high level of trust because it's going to be a very important part of our evolving culture as a much larger company. But those 2 things will stay the same, flat organization, no silos.

Neal，在我們過去 10 年建立這家公司的過程中，我們始終保持著一些不變的原則。一是我們保持了真正的扁平化組織。我們也保持一個非孤立的組織。發展組織並有效維持組織的唯一方法就是擁有不合理的信任程度。當我們鼓勵 Endeavour 員工過來時，我們將展示這種高度的信任，因為這將成為我們作為一家更大的公司不斷發展的文化的非常重要的一部分。但這兩件事將保持不變，扁平的組織，沒有孤島。

Look forward to the new assets, guys.

夥計們，期待新資產。

Our next question comes from the line of Derrick Whitfield of Stifel.

我們的下一個問題來自 Stifel 的 Derrick Whitfield。

Congrats on another solid brand. With my first question, I wanted to focus on the second request from the FTC at a high level. Art Research indicates that most of the larger transactions have received that. Is that consistent with how you're thinking about it?

恭喜又一個堅實的品牌。關於第一個問題，我想重點關注聯邦貿易委員會高層提出的第二個要求。藝術研究表明，大多數較大的交易都收到了這一點。這與你的想法一致嗎？

Yes, that's consistent.

是的，這是一致的。

All right. Terrific. And then shifting over to ops. So during the quarter, you completed 3 additional Upper Spraberry wells. Based on those results and some from last year, could you speak to how the interval competes in your portfolio and if it's likely to get added to your inventory charts on Page 21?

好的。了不起。然後轉向操作。因此，在本季度，您又完成了 3 口 Upper Spraberry 井。根據這些結果和去年的一些結果，您能否談談該區間在您的投資組合中的競爭情況以及它是否有可能添加到第 21 頁的庫存圖表中？

Yes, Derrick. We followed up this year with -- in Q1 with 3 additional Upper Spraberry completions kind of following up that success that we had in the North Martin area with that first test. And we really like the initial results from those wells. And I think that from a cost perspective, we're seeing those costs be pretty competitive. And I think we'll probably look at adding that development to subsequent developments in the future.

是的，德里克。今年，我們在第一季又完成了 3 個 Upper Spraberry 項目，類似於我們在北馬丁地區首次測試的成功。我們非常喜歡這些井的初步結果。我認為從成本角度來看，我們發現這些成本非常有競爭力。我認為我們可能會考慮將這一開發添加到未來的後續開發中。

I think to fill this up to the top of that, Derrick. If you start to add in zones like Upper Spraberry, Wolfcamp D, we've got some really good Wolfcamp D tests in some of those same pads. If you start to add those in and you don't see degradation on a corporate basis in terms of the cume curves that everyone looks at so closely every year. That's inventory extension in our existing asset base. And with the combination of us and Endeavor, adding in zones like the Upper Spraberry, Wolfcamp D into full-scale development, only extends the duration of what we can do here in the Midland Basin.

我想把這個填滿，Derrick。如果您開始添加像 Upper Spraberry、Wolfcamp D 這樣的區域，我們在其中一些相同的墊子中進行了一些非常好的 Wolfcamp D 測試。如果你開始添加這些，你就不會看到公司基礎上每年每個人都密切關注的累積曲線的退化。這是我們現有資產基礎上的庫存擴展。透過我們和 Endeavor 的結合，將 Upper Spraberry、Wolfcamp D 等區域納入全面開發，只會延長我們在米德蘭盆地的工作期限。

Our next question comes from the line of Paul Cheng of Scotiabank.

我們的下一個問題來自豐業銀行的Paul Cheng。

Travis, is that in your presentation, you have an interesting statement on the ESG, you intend to eventually invest in income-generating projects that are expect to more directly offset remaining Scope 1 emissions. Can you elaborate a little bit more in terms of how big is the kind of investment? Are you expecting that to become a new division or that a new business for you? Or that is -- when it is going to be pretty small scale and result pay over the too much attention on that. That's the first question.

Travis，在您的演講中，您對 ESG 有一個有趣的陳述，您打算最終投資於創收項目，這些項目預計將更直接地抵消剩餘的範圍 1 排放。能否詳細說明一下這種投資有多大？您是否期望它成為您的一個新部門或一個新業務？或者說，當它的規模相當小時，結果就會過度關注。這是第一個問題。

The second question is interestingly that the E&P producer, no one really talking much about AI, but the service provider, now it's number they start to brand about say, how AI is going to drive their revenue and it's going to allow the improvement of EUR and productivities -- of the well productivity. So just curious that is Diamondback, you guys have been always do a lot on the technology. Have you tested on the AI application and whether that you see that going to be meaningfully change your EUR or your well productivities.

有趣的是，第二個問題是，勘探與生產生產商，沒有人真正談論人工智慧，但服務提供者，現在他們開始宣傳人工智慧將如何推動他們的收入，以及它將如何提高歐元和生產力— —油井生產力。所以只是好奇那是響尾蛇，你們一直在技術上做了很多工作。您是否測試過人工智慧應用程序，以及您認為這是否會有意義地改變您的歐元或油井生產率。

Well, the first emphasis on AI has been not degenerative AI, but using AI to process data information a lot quicker. And so, look, we're really excited about the long-term implications of AI on our industry, whether that translates to improvements in AUR or improvements in efficiencies or hopefully both, I think, is yet to be determined. But it's one of those things that we're trying to be fast followers on. This is arena of our industry that's moving incredibly fast. These electric frac fleets that we're using right now actually are accumulating more information than we can process. So we're storing some of that information and hoping to use smart algorithms or AI to help us process that information in a more usable and more real-time fashion. Kaes, this first question was the income-generating tech to offset that.

嗯，人工智慧的首要重點不是退化人工智慧，而是利用人工智慧更快處理資料資訊。因此，我們對人工智慧對我們行業的長期影響感到非常興奮，我認為這是否會轉化為 AUR 的改進或效率的改進，或者希望兩者兼而有之，目前尚未確定。但這是我們努力成為快速追隨者的事情之一。這是我們行業發展極為迅速的領域。我們現在使用的這些電動壓裂機組實際上正在累積比我們能夠處理的更多的資訊。因此，我們儲存了一些信息，並希望使用智慧演算法或人工智慧來幫助我們以更可用、更即時的方式處理這些資訊。凱斯，第一個問題是抵銷這項影響的創收技術。

Yes. I mean we have a subsidiary snake company called Cottonmouth Ventures, that's kind of our new ventures snake, I'll call it. But it's not a huge business today. I think one of the more exciting projects we're working on is with our Verde Clean Fuels partnership where we are in the scoping phase of building a plant, a gasoline plant in the basin that's going to be tapped into one of the pipelines that we are participant in. That plant will convert 35 million cubic feet a day of gas -- natural gas, lean gas into 3,000 barrels a day of gasoline.

是的。我的意思是，我們有一家名為 Cottonmouth Ventures 的蛇子公司，我稱之為“蛇”，這就是我們的新企業。但今天這並不是一門大生意。我認為我們正在進行的更令人興奮的項目之一是與 Verde Clean Fuels 合作夥伴關係，我們正處於建設工廠的範圍界定階段，該工廠位於盆地，將接入我們的其中一條管道。將把3,500 萬立方英尺的天然氣、貧氣轉化為3,000 桶汽油。

So that, I think, fits our model of, if we can contribute molecules and expertise to a project, not just capital, but the other things, to drive value. We're going to look at it. I would say that project might FID by the end of this year and be up and running in a couple of years, and that might be a good little offtake for 35 million a day of gas. And if it works, we're going to build more of them.

因此，我認為，如果我們能夠為一個專案貢獻分子和專業知識，不僅僅是資本，還有其他東西，以推動價值，那麼這符合我們的模型。我們要去看看它。我想說，該項目可能會在今年年底完成最終投資決定，並在幾年內啟動並運行，對於每天 3500 萬美元的天然氣來說，這可能是一筆不錯的小額支出。如果它有效，我們將建造更多。

Paul, when you look at the capital program, it's going to spend between $4 billion and $5 billion a year on a pro forma basis. The percent of that, that we're going to allocate to income-generating projects is probably pretty small and that in an individual sense, it will probably have a larger impact, but I wouldn't expect it to move up to the noticeable level on a company that's spending between $4 billion and $5 billion a year.

保羅，當你看看資本計畫時，預計每年將花費 40 億至 50 億美元。我們將分配給創收項目的百分比可能相當小，從個人意義上來說，它可能會產生更大的影響，但我不認為它會上升到明顯的水平一家每年支出 40 億至 50 億美元的公司。

Our next question comes from the line of Leo Mariani of ROTH MKM.

我們的下一個問題來自 ROTH MKM 的 Leo Mariani。

I just wanted to touch base on sort of activity cadence this year. It looks like you guys had kind of 89 first quarter completions, all in the Midland, but that's a pretty healthy percentage, about 32% of your full year budget on completions. Is there some anticipation that maybe some slowdown as the year goes and just seem like a quicker pace than I expected here in the first quarter.

我只是想了解今年的活動節奏。看起來你們第一季完成了 89 個項目，全部都在米德蘭，但這是一個相當健康的百分比，大約佔全年預算的 32%。是否有一些預期，隨著時間的推移，可能會出現一些放緩，而且似乎比我在第一季預期的速度要快。

Yes, Leo, a couple of things. I think we're having a pretty good end of the year last year into Q4, and so we pushed completions into Q1. So Q1 looks a little high relative I think generally you can think about that 70 to 80 overall completion a quarter as the base case. Q2 might be a little towards the high end there. But because we're a little bit ahead of plan in terms of efficiencies and timing we're probably going to reduce our frac crew count by 1 for a period of time over the summer as well as kind of get down into that 12, 13 rigs on the drilling side to complete -- to drill the same number of wells. So we look at the plan almost weekly with the planning team. And I think, generally, the efficiencies have led to less overall activity, more capital efficiency and setting us up well for this potential close here in Q4 with Endeavor.

是的，利奧，有幾件事。我認為去年第四季我們的年末表現相當不錯，因此我們將完工時間推遲到了第一季。因此，第一季相對而言看起來有點高，我認為通常您可以將每個季度 70 到 80 的總體完成率視為基本情況。第二季可能有點接近高階。但是，由於我們在效率和時間方面比計劃提前了一點，因此我們可能會在夏季的一段時間內將壓裂人員數量減少 1 人，並減少到 12、13 人。同樣數量的井。因此，我們幾乎每週都會與規劃團隊一起查看該計劃。我認為，總的來說，效率導致整體活動減少，資本效率提高，並為我們在第四季末與奮進的潛在潛力做好了準備。

No, that's helpful color. And then just shifting over to asset sales. You obviously talked a little bit about sort of when the Endeavor deal closes, maybe moving some midstream assets into your Deep Blue JV and also a drop-down to Viper. Outside of some of the Endeavor-related asset sales, is there anything else that you guys are sort of working on. You talked about raising cash for, just from free cash flow here over the next handful of months until the deal closes. But just trying to get a sense if you guys are looking at other asset sales in the interim.

不，這是有用的顏色。然後就轉向資產銷售。顯然，您談到了 Endeavor 交易完成時的情況，可能會將一些中游資產轉移到您的 Deep Blue 合資企業中，也可能會歸入 Viper。除了奮進號相關的一些資產出售之外，你們還有其他什麼工作要做嗎？您談到了從未來幾個月的自由現金流中籌集現金，直至交易完成。但只是想了解你們是否正在考慮其他資產出售。

Yes. Not many. We sold a piece of our Viper ownership in the first quarter, and that plugged another $450 million of cash on the balance sheet. And I think I'll go back to when we structured this deal. We certainly do not want to put so much cash into the deal with Endeavor that we had to be a seller of assets, and that's exactly what we've done. Now I think we've had some price help here in the last couple of months that has boosted free cash flow and reduced the cash portion of the transaction. And listen, I think the price has got to be right for any asset sale, whether it's the Deep Blue, Viper or otherwise. And we're going to be patient post-close. I do think those assets make sense in other hands, but it's got to be the right value.

是的。不多。我們在第一季出售了 Viper 的部分所有權，資產負債表上又增加了 4.5 億美元的現金。我想我會回到我們建立這筆交易的時候。我們當然不想在與 Endeavour 的交易中投入太多現金，以至於我們不得不成為資產賣家，而這正是我們所做的。現在我認為我們在過去幾個月中得到了一些價格幫助，這增加了自由現金流並減少了交易的現金部分。聽著，我認為任何資產出售的價格都必須合適，無論是深藍、毒蛇或其他。我們將在交易結束後保持耐心。我確實認為這些資產在其他人手中是有意義的，但它必須具有正確的價值。

Okay. That's helpful. And then just wanted to ask about your production kind of severance tax here. You give the guiding to kind of 7% of revenue. It's kind of come in below that the last handful of quarters, closer to 5% to 6%. Just wanted to see what was kind of going on there. Maybe that was kind of anomalous in the last handful of quarters and 7% the right number going forward?

好的。這很有幫助。然後只是想問一下你們的生產遣散費。你給了大約 7% 的收入指引。有點低於過去幾季的水平，接近 5% 到 6%。只是想看看那裡發生了什麼事。也許這在過去幾季有點反常，而 7% 是未來的正確數字？

Yes. It was just higher than that before then, a couple of quarters before that, and we had to work off the accruals. That number has been 7% for 10 years. We had a consultant that told us it was going to be higher last year, and that consultant is no longer working for us, but it's going to be 7% on an annual basis on average.

是的。它只比之前高，幾個季度之前，我們必須扣除應計費用。 10 年來這個數字一直維持在 7%。我們有一位顧問告訴我們去年會更高，那位顧問不再為我們工作，但平均每年增加 7%。

This concludes the question-and-answer session. I would now like to hand the call back over to Travis Stice.

問答環節到此結束。我現在想將電話轉回特拉維斯·斯蒂斯。

Thank you again to everyone participating in today's call. If you've got any questions, please reach out to us using the contact information provided. Thank you, and have a great day.

再次感謝參加今天電話會議的所有人。如果您有任何疑問，請使用提供的聯絡資訊與我們聯絡。謝謝您，祝您有美好的一天。

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

感謝您參加今天的會議。這確實結束了該程式。您現在可以斷開連線。