Highpeak Energy Inc (HPK) 2022 Q4 法說會逐字稿

Good day, and thank you for standing by. Welcome to the HighPeak Energy 2022 Fourth Quarter 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 your first speaker today, the CFO, Steven Tholen. Mr. Tholen, please go ahead.

美好的一天，謝謝你的支持。歡迎來到 HighPeak Energy 2022 年第四季度收益電話會議。 （操作員說明）請注意，今天的會議正在錄製中。我現在想將會議交給您今天的第一位發言人，首席財務官 Steven Tholen。 Tholen 先生，請繼續。

Thank you. Good morning, everyone, and welcome to HighPeak Energy's Fourth Quarter 2022 Earnings Call. Representing HighPeak today are our Chairman and CEO, Jack Hightower; President, Michael Hollis, Vice President of Business Development, Ryan Hightower, and I am Stephen Tholen, the Chief Financial Officer. During today's call, we will make reference to our March investor presentation and our fourth quarter 2022 earnings release, which can be found on HighPeak's website. Today's call participants may make certain forward-looking statements relating to the company's financial condition, results of operations, expectations, plans, goals, assumptions, and future performance.

謝謝。大家早上好，歡迎來到 HighPeak Energy 的 2022 年第四季度財報電話會議。今天代表 HighPeak 的是我們的董事長兼首席執行官 Jack Hightower；總裁 Michael Hollis、業務發展副總裁 Ryan Hightower 和我是首席財務官 Stephen Tholen。在今天的電話會議中，我們將參考 HighPeak 網站上的 3 月份投資者介紹和 2022 年第四季度收益發布。今天的電話會議參與者可能會就公司的財務狀況、經營業績、預期、計劃、目標、假設和未來業績做出某些前瞻性陳述。

So please refer to the cautionary information regarding forward-looking statements and related risks in the company's SEC filings, including the fact that actual results may differ materially from our expectations due to a variety of reasons, many of which are beyond our control. We will also refer to certain non-GAAP financial measures on today's call, so please see the reconciliations in the earnings release and our March investor presentation.

因此，請參閱公司提交給美國證券交易委員會的文件中有關前瞻性陳述和相關風險的警示信息，包括實際結果可能因各種原因與我們的預期存在重大差異，其中許多原因超出了我們的控制範圍。我們還將在今天的電話會議上提及某些非 GAAP 財務措施，因此請參閱收益發布和我們 3 月份的投資者介紹中的對賬。

I will now turn the call over to our Chairman and CEO, Jack Hightower.

我現在將把電話轉給我們的董事長兼首席執行官傑克海托爾。

Thanks, Steve, and good morning, ladies and gentlemen, and we want to thank you for joining our call today. As we go forward and think about the last year, it's just amazing that we've had such a banner year. But also, I want to emphasize that everybody is aware that we have began our process for strategic alternatives, and we'll talk a little bit about that today. But I want to just point out that we posted great year-end 2022 results. Hopefully, you've had a chance to look at your press release and you can see that our expectations and further substantiate our long-term strategic plan.

謝謝，史蒂夫，早上好，女士們先生們，我們要感謝你們今天加入我們的電話會議。當我們向前看並回想過去的一年時，我們經歷了這樣一個標誌性的一年真是太神奇了。而且，我想強調的是，每個人都知道我們已經開始了我們的戰略選擇過程，我們今天將稍微討論一下。但我只想指出，我們發布了出色的 2022 年底業績。希望您有機會查看您的新聞稿，您可以看到我們的期望並進一步證實我們的長期戰略計劃。

As I look back on 2022, unquestionably, we've had a banner year. We increased our business in a really responsible and multipronged approach, both through the [drill bit] and through strategic accretive acquisitions. That's how we (inaudible) on a balanced approach with organic growth through drilling and also through accretive acquisitions. We've moved from 61,000 acres at the end of 2021 to over 112,000 acres today. We grew our acreage position, but we also delineated the majority of our acquired acreage in multiple zones across our entire position.

回顧 2022 年，毫無疑問，我們度過了豐收的一年。我們以一種真正負責任和多管齊下的方式增加了我們的業務，既通過 [鑽頭] 又通過戰略性增值收購。這就是我們（聽不清）通過鑽探和增值收購實現有機增長的平衡方法。我們已經從 2021 年底的 61,000 英畝增加到今天的 112,000 多英畝。我們增加了我們的種植面積位置，但我們也劃定了我們整個位置的多個區域中的大部分收購面積。

We increased our production. We increased cash flow. We increased proved reserves over the past 12 months at rates that no one else in the industry has been able to achieve. And we did this by maintaining a very healthy balance sheet. We also continued to improve our productivity of our primary reservoirs as evidenced by our 2022 vintage wells outperformed our 2021 and 2020 well results.

我們增加了產量。我們增加了現金流。在過去的 12 個月裡，我們以業內其他任何人都無法達到的速度增加了探明儲量。我們通過保持非常健康的資產負債表來做到這一點。我們還繼續提高主要油藏的生產力，我們 2022 年的老式油井優於 2021 年和 2020 年的油井結果就證明了這一點。

We're really proud of the fact that we've been able to continue improving through our operational efficiency, our learning about how to treat these -- this rock in terms of completion and through larger drilling pads, infilled child locations and a higher percentage of wells in our Signal Peak area, which we continue to be very excited about.

我們感到非常自豪的是，我們能夠通過我們的運營效率、我們對如何處理這些岩石的學習以及通過更大的鑽井墊、填充的子位置和更高的百分比來繼續改進這些岩石。我們的 Signal Peak 區域的油井，我們仍然對此感到非常興奮。

We maintain our peer-leading margins and actually increased our cash margins throughout last year as our operating teams continue to make large strides in reducing our lease operating expenses and total cash cost. This is tremendous improvements and continued improvements to be able to do this into the future.

由於我們的運營團隊在減少租賃運營費用和總現金成本方面繼續取得長足進步，我們在去年全年保持了同行領先的利潤率並實際增加了我們的現金利潤率。這是巨大的改進和持續改進，能夠在未來做到這一點。

I'm really proud of our organization. We have a lean organization. Everybody continues to work hard. Their efforts towards cost reduction on both sides of the equation, maximizing capital efficiency, lowering operating expenses and optimizing well performance, which we were actually one of the few teams in the Permian Basin that are actually improving on our well performance. And the seamless asset integration, which allowed the company to accomplish these milestones in 2022. It was a challenging year due to many factors, we had serious inflationary pressures.

我真的為我們的組織感到自豪。我們有一個精益組織。大家繼續努力。他們努力降低等式兩邊的成本，最大限度地提高資本效率，降低運營費用和優化油井性能，我們實際上是二疊紀盆地為數不多的實際改善油井性能的團隊之一。以及無縫的資產整合，使公司能夠在 2022 年實現這些里程碑。由於多種因素，這是充滿挑戰的一年，我們面臨著嚴重的通脹壓力。

We had supply chain disruptions just like the rest of our peers did, but we navigated through these challenges and actually improved. We ended on a high note, and we fully expect this momentum to continue in 2023. We're going to stay focused on optimizing shareholder value, optimizing our returns and optimizing our accomplishments relative to our business.

與其他同行一樣，我們也曾經歷過供應鏈中斷，但我們克服了這些挑戰並取得了實際進步。我們以高調結束，我們完全預計這種勢頭將在 2023 年繼續。我們將繼續專注於優化股東價值，優化我們的回報並優化我們與業務相關的成就。

The first slide I want to talk about is on Page 4 of the deck and this is similar to our last slide that we talked about in our third quarter, very similar, but I think the important thing is that our production averaged 37,300 barrels a day, which is a 42% increase over the third quarter, a 150% increase compared to last year's fourth quarter. That is unprecedented growth. We still have lumpy production. We go up 1 quarter, we maintain the next quarter. We're going to continue having lumpy production, don't multiply that 40% increase 4 quarters in a row.

我想談的第一張幻燈片在甲板的第 4 頁，這與我們在第三季度談論的最後一張幻燈片相似，非常相似，但我認為重要的是我們的平均產量為每天 37,300 桶，比第三季度增長42%，比去年第四季度增長150%。那是前所未有的增長。我們的生產仍然不穩定。我們上升一個季度，我們維持下一個季度。我們將繼續生產不穩定，不要連續 4 個季度增加 40%。

But if you just think about, we hit our guidance, we're going to continue hitting our guidance throughout this year. We exited the year at close to 40,000 barrels a day, which was at the high end of our guidance. We also had somewhere between 1,000 and 2,000 barrels a day [Kirktail] throughout the fourth quarter due to some midstream expansion projects. And if it was not for that, we would have surpassed our high end on both our average and exit production guidance ranges.

但如果你只是想想，我們達到了我們的指導，我們將在今年繼續達到我們的指導。我們以每天接近 40,000 桶的速度退出了這一年，這是我們指導的高端。由於一些中游擴張項目，我們在整個第四季度每天 [Kirktail] 也有 1,000 到 2,000 桶。如果不是這樣，我們的平均和退出生產指導範圍都會超過我們的高端。

We increased our crude reserves 92% year-over-year to 123 million barrels of oil. And we continue to expand our acreage footprint, which is now over 112,000 acres with line of sight for additional increases there. So we're getting good contiguous add-ons as we expand our acreage blocks. We have 2 contiguous acreage blocks with high working interest. We're set up for long laterals, we've been averaging somewhere around 12,000 to 12,500 foot laterals. Our capital efficiency on our development program will allow us to hold our entire acreage position with 1 to 1.5 rigs.

我們的原油儲量同比增加 92% 至 1.23 億桶。我們繼續擴大我們的種植面積，現在已經超過 112,000 英畝，並且可以看到那裡的額外增加。因此，隨著我們擴大我們的面積塊，我們將獲得良好的連續附加組件。我們有 2 個連續的面積塊，具有很高的工作興趣。我們已為長支路做好了準備，平均水平支路在 12,000 到 12,500 英尺左右。我們在開發計劃上的資本效率將使我們能夠用 1 到 1.5 個鑽井平台來保持我們整個種植面積的位置。

As you can see, we had several wells in progress at the end of the year which will all come online during the first half of 2023. Presently, we have almost 57 wells that are in the process of drilling and completion. So that -- wells that are already drilled and being in progress are going to substantially add to our production as we go forward here.

如您所見，我們在年底有幾口井在建，這些井將在 2023 年上半年全部投產。目前，我們有近 57 口井正在鑽完井。因此，隨著我們在這裡前進，已經鑽探和正在鑽探的油井將大大增加我們的產量。

We had several additional wells in progress that help us substantiate (inaudible) achieving production guidance numbers. Very -- many of these are in other zones. So -- and as you can see, looking at financial statistics on this slide, we're projecting [$1.525 billion] exiting fourth quarter of this year and this is utilizing $90 a barrel, which is a price basically that is being utilized by most of our peers and budgeting purposes or prices, even though we recognize prices are below that right now. And then we exit fourth quarter of '24 with almost $2 billion in EBITDA. Great improvement as we go forward.

我們還有幾口在建井，幫助我們證實（聽不清）實現生產指導數字。非常 - 其中許多位於其他區域。所以 - 正如你所看到的，看看這張幻燈片上的財務統計數據，我們預計今年第四季度將退出 [15.25 億美元]，這是使用每桶 90 美元的價格，這基本上是大多數人使用的價格我們的同行和預算目的或價格，即使我們認識到現在的價格低於這個價格。然後我們以近 20 億美元的 EBITDA 退出了 24 年第四季度。我們前進的過程中有很大的進步。

The next -- Slide 5. I'm going to try to go through these fairly quickly to just hit the highlights on these slides, but Slide 5 is a differentiated growth story that takes us from overspending to actually having free cash flow in this year's business. I've had people ask me, when is that going to take place? And the answer is we just don't know because we don't have a crystal ball as to where oil prices are going to be. But if the analysts and our own internal projections are correct, we will start seeing free cash flow in the second half of next year.

下一張 -- 幻燈片 5。我將嘗試快速瀏覽這些幻燈片以突出這些幻燈片上的亮點，但幻燈片 5 是一個差異化的增長故事，它使我們從超支到實際擁有今年的自由現金流商業。有人問我，什麼時候會發生？答案是我們只是不知道，因為我們沒有關於油價將走向何方的水晶球。但如果分析師和我們自己的內部預測是正確的，我們將在明年下半年開始看到自由現金流。

We are on course to reach that inflection point with material free cash flow generation. It's just a function of is it this 90 days, the next 90 days, when is that going to take place? Our asset base has actually grown organically from 0 to 40,000 barrels per day over the past 2 years. There's no way to prove high rock quality better than exhibiting substantial production volumes. And by executing our plan, at the end of this year, we'll have an EBITDA run rate of over $1.5 billion at a reasonable oil price.

我們正朝著物質自由現金流產生的拐點邁進。這只是這 90 天、接下來的 90 天、什麼時候發生的函數？在過去 2 年中，我們的資產基礎實際上已經從每天 0 桶有機增長到 40,000 桶。沒有比展示大量產量更能證明高品質岩石的方法了。通過執行我們的計劃，到今年年底，在合理的油價下，我們的 EBITDA 運行率將超過 15 億美元。

In addition, we will be positioned to continue increasing our production next year and with a reasonable growth rate similar to the rig cadence that we presently have. And that gives us roughly $1 billion of free cash flow on a $90 price per barrel in next year's business. At that point in time, our free cash flow yield and investment rates will compete with anyone in our industry. So as you can see, I'm very excited about what's taking place in the company, and I'm going to turn the call over to Mike now to talk about our margins and provide you with an operational update. Mike?

此外，我們明年將繼續增加產量，並以與我們目前擁有的鑽機節奏相似的合理增長率。這讓我們在明年的業務中以每桶 90 美元的價格獲得大約 10 億美元的自由現金流。屆時，我們的自由現金流收益率和投資率將與我們行業中的任何人競爭。所以正如你所看到的，我對公司正在發生的事情感到非常興奮，我現在要把電話轉給邁克來談談我們的利潤率並為您提供運營更新。麥克風？

Thanks, Jack. Now turning to Slide 6, margins. It sounds like a broken record, but our BOEs are not the same as everyone else's. We continue to expand our margins differentially to our peer group. Our fourth quarter margin per BOE was 47% higher than our peer average. This theme will remain over the coming quarters as natural gas prices stay depressed. Don't forget the gas prices in the fourth quarter were higher than what we're seeing today. With our high oil mix, high peaks margins will expand even further compared to our peer group next quarter.

謝謝，傑克。現在轉到幻燈片 6，邊距。這聽起來像是一個破紀錄，但我們的 BOE 與其他人的不一樣。我們繼續以差異化方式擴大我們的利潤率。我們第四季度每桶油當量的利潤率比同行平均水平高 47%。隨著天然氣價格持續低迷，這一主題將在未來幾個季度持續存在。不要忘記第四季度的天然氣價格高於我們今天看到的價格。憑藉我們的高油組合，與下個季度的同行相比，高峰值利潤率將進一步擴大。

On a relative value basis, our average peer would need to produce about 60,000 BOEs per day to achieve the same cash flow results that we do with 40,000 BOEs per day. And in today's market, a company that produces in line with 60,000 barrels a day, it's typically viewed much differently by Wall Street than [1 40]. Size matters, but I disagree with that thought process, the impetus should be on efficiently converting oil and gas into dollars and cents, and that is exactly what we focus on at HighPeak.

在相對價值的基礎上，我們的平均同行每天需要生產約 60,000 個 BOE 才能實現與我們每天生產 40,000 個 BOE 相同的現金流量結果。在今天的市場上，一家每天生產 60,000 桶的公司，華爾街對它的看法通常與 [1 40] 大不相同。規模很重要，但我不同意這種思維過程，動力應該是有效地將石油和天然氣轉化為美元和美分，而這正是我們在 HighPeak 關注的重點。

Although we're very bullish on oil prices long term, in the short-term price volatility and looks like it will continue. So we are very fortunate to produce such valuable barrels, which will help us remain financially strong even during periods of price volatility. So in addition to our BOEs being very oil-rich and highly profitable, we continue to drive down our operating costs, which will further increase our core cash cost. All-in cash cost per BOE continues to decrease. We reduced our LOE 15% quarter-over-quarter.

儘管我們非常看好油價的長期走勢，但短期內價格波動似乎還會繼續。因此，我們非常幸運能夠生產出如此有價值的桶，這將幫助我們即使在價格波動期間也能保持強勁的財務狀況。因此，除了我們的 BOEs 非常富含石油和高利潤之外，我們繼續降低運營成本，這將進一步增加我們的核心現金成本。每桶油當量的全部現金成本繼續下降。我們環比將 LOE 降低了 15%。

Now in the fourth quarter, G&A was a little higher due to year-end bonuses, but it's reasonable to expect that it will continue to drop as evidenced by our previous quarters. We continue to keep a lean and efficient workforce as volumes increase. And as the denominator grows, the fixed cost will continue to be diluted, again, expanding the margins. This is a great time to throw a shout out to our HighPeak organization. 2022, as Jack said, was a great year for our company and none of this will (inaudible) you make what we do easy. Thanks. We continue to drive operational excellence in all facets of the business. We are continuing to remove costly generators. Our fixed costs continue to reduce as our production increases and building infrastructure and Signal Peak, which will further reduce our cost in that area of the field. Our margin per BOE is the best in the business and will continue to expand, further differentiating HighPeak from our peer group.

現在在第四季度，由於年終獎金，G&A 略高，但可以合理地預期它將繼續下降，正如我們前幾個季度所證明的那樣。隨著數量的增加，我們將繼續保持精簡和高效的員工隊伍。隨著分母的增長，固定成本將繼續被稀釋，從而再次擴大利潤率。現在是向我們的 HighPeak 組織大聲疾呼的好時機。正如傑克所說，2022 年對我們公司來說是偉大的一年，這一切都不會（聽不清）讓我們的工作變得輕鬆。謝謝。我們繼續在業務的各個方面推動卓越運營。我們將繼續拆除昂貴的發電機。隨著我們產量的增加以及基礎設施和 Signal Peak 的建設，我們的固定成本繼續降低，這將進一步降低我們在該領域的成本。我們每桶油當量的利潤率是業內最好的，並將繼續擴大，進一步將 HighPeak 與我們的同行集團區分開來。

Now turning to Slide 8. ESG. We've been very transparent with our goals and initiatives. Fortunately, for us, we were the original architect of our position. We were able to set up everything with efficient operations and environmental stewardship in mind. Power. We run a very energy-intensive business, so it's imperative that we'd be efficient, clean and scalable. We oversized our substation which allows another rig or 2 to utilize high line power up at Flat Top. And we've also added another frac crew in [dual] fuel.

現在轉到幻燈片 8。ESG。我們的目標和舉措一直非常透明。幸運的是，對我們來說，我們是我們職位的原始建築師。我們能夠在考慮高效運營和環境管理的情況下設置一切。力量。我們經營的是一項能源密集型業務，因此我們必須高效、清潔和可擴展。我們超大了我們的變電站，允許另一台或 2 台鑽機在平頂使用高壓線路供電。我們還在 [雙] 燃料中增加了另一名壓裂人員。

Facilities, we build very large-scale central tank batteries that minimize our footprint and make for adding additional wells cheaper and more environmentally friendly to connect. Recycle. We continue to recycle high levels of our stimulation fluids and are expanding our recycled capabilities across both large acreage blocks, reducing cost and the need for makeup water. Sand. We now have 3 frac crews utilizing local wet sand, which greatly reduces our emissions and costs. All of our ESG initiatives are both financially and environmentally rewarding for our shareholders. High Peak looks at these initiatives as just doing the right thing.

設施，我們建造非常大規模的中央儲罐電池，以最大限度地減少我們的足跡，並使增加額外的井更便宜、更環保地連接起來。回收。我們繼續回收高水平的增產液，並擴大我們在兩個大面積區塊的回收能力，以降低成本和對補給水的需求。沙。我們現在有 3 個壓裂小組使用當地的濕沙，這大大減少了我們的排放和成本。我們所有的 ESG 舉措都為我們的股東帶來了財務和環境方面的回報。 High Peak 認為這些舉措只是在做正確的事情。

Now turn to Slide 9, Flat Top operational update. East Howard County has always been plagued by the reticence of some as to whether we have good rock and enough inventory in multiple formations. The work we've done to date demonstrates very robust economic results across the entirety of the block. From the Northwest to the Southeast, and from the southwest to the northeast. The [Conrad ad], bullet #1, extended the Lower [Spraberry] and Wolfcamp A into [Morgan] County. Four miles northeast of our main development area for the Wolfcamp A and almost 7 miles east of our existing Lower Spraberry wells.

現在轉到幻燈片 9，平頂操作更新。東霍華德縣一直受到一些人對我們是否擁有良好的岩石和足夠的多個地層庫存的沉默的困擾。我們迄今為止所做的工作表明，整個區塊都取得了非常強勁的經濟成果。從西北到東南，從西南到東北。 [康拉德廣告]，項目符號 #1，將 Lower [Spraberry] 和 Wolfcamp A 延伸至 [Morgan] 縣。在我們主要的 Wolfcamp A 開發區東北 4 英里處，在我們現有的 Lower Spraberry 油井以東近 7 英里處。

And both of these Conrad wells are performing similar to the development in the core of the Flat Top area, again expanding the footprint for our inventory. [Flemipad], bullet number two, a 4-well stacked lateral pad with a Wolfcamp D as in David, 3-finger tests and a Wolfcamp B as in beta test plus a lower Spraberry and Wolfcamp A. These wells provide multi-zone support for additional inventory down in this area.

這兩口康拉德井的表現與平頂地區核心的開發類似，再次擴大了我們庫存的足跡。 [Flemipad]，第二個項目符號，一個 4 孔堆疊的橫向墊，帶有 David 中的 Wolfcamp D，3 指測試和 Beta 測試中的 Wolfcamp B 以及較低的 Spraberry 和 Wolfcamp A。這些井提供多區域支持在這個區域有額外的庫存。

The Griffin pad bullet #3. It's a 5-well pad Three Wolfcamp A's and 2 Lower Spraberry wells, again, solidifying that the Lower Spraberry and the Wolfcamp A formations are good across our entire Borden County acreage. Southeast Flat Top area, Bullet #4, the red box, has demonstrated similar well results to the wells back to the west, again, giving us confidence in this area as well. All of these results give line of sight to the inventory runway and ability to continue to efficiently grow HighPeak's productions. Highpeak surface Bullet #5, houses our field office, our 1 million-barrel recycle facility and home to the solar farm.

格里芬墊子彈 #3。這是一個 5 井井場，三個 Wolfcamp A 井和 2 個 Lower Spraberry 井，再次證實了 Lower Spraberry 和 Wolfcamp A 地層在我們整個博登縣的種植面積上都很好。 Southeast Flat Top 區域，項目符號 #4，紅色框，已經顯示出與西部油井相似的井結果，再次讓我們對該區域充滿信心。所有這些結果都為庫存跑道提供了視線，並使 HighPeak 能夠繼續有效地增加產量。 Highpeak 地表 Bullet #5 是我們的現場辦公室、我們的 100 萬桶回收設施和太陽能農場的所在地。

If you'll turn now to Slide 10, Signal Peak operational update. There's a ton of exciting activity going on at Signal Peak. HighPeak has previously delineated the base, lower Wolfcamp D across the entire block. We are now producing 26 wells in the lower base Wolfcamp B. We continue to delineate the Wolfcamp A and the Lower Spraberry as shown with bullets 3, 4 and 5. Multiple 3-finger Wolfcamp D and Wolfcamp C [Huttotest] are in progress as shown with bullets 1 and 2. We are expanding our recycled capabilities and overhead electric power system which will continue to drive down our lifting cost. And we are excited and look forward to sharing these results from our upside wells and locations in the coming quarters.

如果您現在轉到幻燈片 10，Signal Peak 操作更新。 Signal Peak 正在進行大量激動人心的活動。 HighPeak 之前已經劃定了整個街區的 Wolfcamp D 基地。我們現在在較低的 Wolfcamp B 基地生產 26 口井。我們繼續描繪 Wolfcamp A 和 Lower Spraberry，如項目符號 3、4 和 5 所示。多個 3 指 Wolfcamp D 和 Wolfcamp C [Huttotest] 正在進行中用項目符號 1 和 2 顯示。我們正在擴大我們的回收能力和架空電力系統，這將繼續降低我們的提升成本。我們很高興並期待在未來幾個季度分享我們上部井和位置的這些結果。

I'll now hand the call back over to Jack to discuss our year-end reserves.

我現在將電話轉回給傑克，討論我們的年終儲備金。

Thanks, Mike. The next slide on Slide 11 gives you our year-end proved reserve summary and as I mentioned earlier, we've had phenomenal success over the last 2 years as evidenced by 130% compounded annual growth rate of our proved reserves. Remember, though, that our BOEs are different, and they currently have 47% higher margin than other reserves from our peers. Our reserve replacement ratio in '22 was 550% through the drill bit, not including acquisitions.

謝謝，邁克。幻燈片 11 的下一張幻燈片為您提供了我們的年終探明儲量摘要，正如我之前提到的，我們在過去兩年中取得了驚人的成功，我們探明儲量 130% 的複合年增長率就是證明。但請記住，我們的 BOE 是不同的，它們目前的利潤率比我們同行的其他儲備高 47%。通過鑽頭，我們在 22 年的儲量替代率為 550%，不包括收購。

And if you look at our '22 acquisitions, our replacement ratio then increases to over 750%, unprecedented in my 53 years in the business in terms of growing. Of course, if you didn't have any reserves in well and it was a discovery, it was a tremendous growth. But when you now consider that we have over 220 wells drilled to continue with this growth process, That's the thing that substantiated and you can have expectations in the future to continue doing this. Our trajectory of proved reserve growth will continue.

如果你看看我們 22 年的收購，我們的替代率就會增加到 750% 以上，這在我 53 年的業務增長方面是前所未有的。當然，如果你井裡沒有任何儲量，這是一個發現，那就是一個巨大的增長。但是，當您現在考慮到我們鑽探了 220 多口井以繼續這一增長過程時，這就是事實，您可以期望將來繼續這樣做。我們探明儲量增長的軌跡將繼續下去。

We've fully seen of total resource potential for these assets consider that we have over 2,500 locations. And we have intentionally been very conservative in our annual reserve booking process we're not changing anything. It is not broken just continue being conservative (inaudible) at 6% (inaudible) of original [in place] we're not booking reserves from one end of the field to the other. We do step outs, very conservative. And keep in mind that in any 5-year period with outside engineers. It doesn't matter if it's Netherland and (inaudible), Roger, Scott, (inaudible), our own internal engineers, you can go right down the list, you have almost double reserve success, especially (inaudible) over a period of time with each 5-year period of technological improvement.

考慮到我們擁有 2,500 多個地點，我們已經充分了解了這些資產的總資源潛力。我們在年度儲備預訂過程中故意非常保守，我們沒有改變任何東西。它並沒有被打破，只是繼續保持保守（聽不清）在原始 [in place] 的 6％（聽不清），我們不會從該領域的一端到另一端預訂儲備。我們確實走出去，非常保守。請記住，在任何與外部工程師合作的 5 年期間。不管是荷蘭還是（聽不清）、羅傑、斯科特（聽不清）、我們自己的內部工程師，你都可以直接往下看，你幾乎有雙倍的儲備成功率，尤其是在一段時間內（聽不清）每 5 年的技術改進期。

Our reserves are going to continue going up. Our recoveries are going to continue going up (inaudible) technological success. And we're also improving return deliveries and we're improving on deliverability, the turn on investment parameters being better and better and better as we go forward in this. So we're going to continue being conservative on our booking process, but we've got a lot of meat left on the bone so to speak.

我們的儲備將繼續增加。我們的恢復將繼續上升（聽不清）技術成功。我們也在改進回報交付，我們正在改進交付能力，隨著我們在這方面的進步，投資參數的轉變越來越好。因此，我們將繼續在預訂過程中保持保守，但可以這麼說，我們的骨頭上還剩下很多肉。

For the next slide to look at is -- and I mentioned this once before that we wanted to compare our area in Eastern Howard County to Western Howard County, more in the -- as we go deeper into the basin and more compared to some of our larger peers in the area. We've talked about our reserves, how fast they're growing, but Eastern Howard County is a very active area and the margins are differentiated from other areas of the basin. At the end of the year, our (inaudible) of the Eastern compared to western and looking at results from 2020 onwards shows (inaudible) is actually outperforming the West on a recovery factor of oil prices.

下一張要看的幻燈片是——我之前提到過這一點，我們想比較東霍華德縣和西霍華德縣的地區，更多的是——隨著我們深入盆地，更多地與一些地區進行比較我們在該地區較大的同行。我們已經談到了我們的儲量，它們的增長速度，但東霍華德縣是一個非常活躍的地區，其邊緣與盆地的其他地區不同。到年底，我們的東方（聽不清）與西方相比，從 2020 年開始的結果顯示（聽不清）實際上在油價恢復因素方面優於西方。

In addition, HighPeak is outperforming its peers, its peers in the (inaudible) county. We now have over [1,700] wells drilled (inaudible) and our results are over 500,000 barrel recoverable compared to 471 of our peers in the West. We're almost 10% higher on EUR and almost 10% higher on economics, not counting consideration of having a higher oil cut. One of the local newspapers in Midland, the Midland reporter telegram announced in the last few weeks that Howard County is the fastest-growing producer of oil in the entire United States and Howard County has now moved into the #3 position in the Permian Basin as far as oil production.

此外，HighPeak 的表現優於其同行，即（聽不清）縣的同行。我們現在鑽了 [1,700] 多口井（聽不清），我們的結果是超過 500,000 桶可回收，而我們在西方的同行只有 471 口。我們在歐元方面高出近 10%，在經濟方面高出近 10%，這還不包括石油減產的考慮。米德蘭的當地報紙之一，米德蘭記者電報在過去幾周宣布，霍華德縣是整個美國增長最快的石油生產國，霍華德縣現已成為二疊紀盆地的第三名就石油生產而言。

So we're in a great area. It's going to continue improving as we go forward. And these results are indicative of our success in Southern Borden County as well. As Mike previously walked through our delineation of Lower Spraberry and Wolf A in this area, that's going to increase additional shareholder value. So we're not just buying leases to buy gold pasture, so to speak. We're buying leases and expanding our footprint and as we drill it up, it's becoming very commercially successful. In fact, both of those wells are making over 800 barrels a day now. So we're really excited about that area.

所以我們在一個很棒的地方。隨著我們的前進，它將繼續改進。這些結果也表明我們在南博登縣取得了成功。正如 Mike 之前在該地區走過我們對 Lower Spraberry 和 Wolf A 的描述一樣，這將增加額外的股東價值。所以我們不只是購買租賃來購買黃金牧場，可以這麼說。我們正在購買租約並擴大我們的足跡，隨著我們的深入，它在商業上變得非常成功。事實上，這兩口井現在每天生產 800 多桶石油。所以我們對那個領域感到非常興奮。

The next Slide 13 just shows our inventory, and it gives us a sense of with running a forward program with 1,300 primary locations, we have over 14 years of primary inventory runway. Every time we make a presentation in 30 days, we have 10 more wells in and we're delineating other zones now. And so when you look at this, chart, you see all the way from the Mill Spraberry all the way down to the Wolf B, and that includes the Wolf B 3 fingers and also the [huddle] zone. We are developing all these zones now, and we're going to have a lot more information and some of our offset operators are also drilling in these zones, up in the Middle Spraberry and the [Jo Mills]. So we have expectations to be able to continue going forward with upside formations, and we hope that several of these upside locations will add to our primary count within the last -- within the next few quarters as we see the results of these wells.

下一張幻燈片 13 只是展示了我們的庫存，它讓我們感受到了在 1,300 個主要地點運行一個前向計劃，我們有超過 14 年的主要庫存跑道。每次我們在 30 天內進行演示時，我們都會多鑽 10 口井，我們現在正在劃定其他區域。因此，當您查看此圖表時，您會看到從 Mill Spraberry 一直到 Wolf B，其中包括 Wolf B 3 個手指以及 [huddle] 區域。我們現在正在開發所有這些區域，我們將獲得更多信息，我們的一些偏移運營商也在這些區域鑽探，在 Middle Spraberry 和 [Jo Mills]。因此，我們期望能夠繼續推進上行形態，我們希望這些上行位置中的幾個將在我們看到這些井的結果後的最後幾個季度內添加到我們的主要計數中。

I mentioned earlier that our locations are averaging over 12,000-foot laterals now, we have the opportunity to do that because of our contiguous acreage block. A lot of our peers have more acreage inventory but it's unattainable acreage. It's very difficult for them to put units together to deal with pooling problems and to deal with other companies and arguments as to who's going to operate what pipeline is a well going to sell into? What are the marketing characteristics who has better marketing, we control everything in our area. So we have the choice to drill and to space our wells primarily best that gives us the maximum shareholder return and ultimately leads to higher free cash flow generation.

我之前提到過，我們的位置現在平均超過 12,000 英尺的橫向，我們有機會這樣做，因為我們有連續的面積塊。我們的許多同行擁有更多的庫存面積，但這是無法達到的面積。他們很難將單位放在一起來處理匯集問題，並與其他公司打交道，以及關於誰將運營一口井將出售給哪條管道的爭論？誰有更好的營銷特點，我們控制著我們領域的一切。因此，我們可以選擇以最佳方式鑽探和佈置我們的油井，從而為我們帶來最大的股東回報，並最終帶來更高的自由現金流量。

It's why 40,000 barrels is equal 60,000 barrels with our peers.

這就是為什麼40,000桶與我們的同行一樣等於60,000桶。

So in Slide 14, this is an exciting slide also. We messaged in January press release that we plan to step down from our 6-rig program, which we were running in the second half of '22 to running 4 rigs throughout '23 and '24. Many things considered that, not because we don't have the results of drilling activity. We want to keep a strong balance sheet. Oil and gas prices went down during that period. We have a higher number of wells that we expect to turn in line this year with 57 wells in progress. The backlog of those wells in progress that we built while running our 6-week rig program last year, and this point is the primary reason for the delta in our CapEx budget in '23 compared to our forecasted CapEx budget in '24. We didn't want to overdrill. We wanted to get maximum return on investment. So we're being conservative with the development of our pads and with our spacing program.

所以在幻燈片 14 中，這也是一張令人興奮的幻燈片。我們在 1 月份的新聞稿中表示，我們計劃退出我們在 22 年下半年運行的 6 鑽機計劃，在 23 年和 24 年期間運行 4 台鑽機。考慮到很多事情，並不是因為我們沒有鑽探活動的結果。我們希望保持強勁的資產負債表。石油和天然氣價格在此期間下跌。我們預計今年將有更多的油井轉產，有 57 口油井在建。我們在去年運行為期 6 週的鑽井計劃時建造的那些在建油井的積壓，這一點是我們 23 年資本支出預算與 24 年預測資本支出預算相比出現增量的主要原因。我們不想過度鑽探。我們希望獲得最大的投資回報。因此，我們對護墊的開發和間距計劃持保守態度。

Our unit cost per BOE, which is already very competitive with our peers, is going to continue to increase and will further expand our peer-leading margins. This wasn't by accident. This was a planned program all the way throughout in the way we have always differentiated ourselves from our peers to have higher return on investment and higher internal rates of return. The key point of this slide is to show where we're going. We're going to become free cash flow, and it's going to be a free cash flow machine. I've had investors ask me, well, when is that going to happen? Well, if I knew exactly when prices are going to be projected, I will be able to say when that's going to happen but I'm comfortable that it's going to happen in the second half of this year.

我們的每桶油當量單位成本已經與我們的同行相比具有很強的競爭力，而且將繼續增加，並將進一步擴大我們在同行中領先的利潤率。這並非偶然。這是一個自始至終都經過計劃的項目，我們始終將自己與同行區分開來，以獲得更高的投資回報率和更高的內部回報率。這張幻燈片的關鍵點是展示我們要去的地方。我們將成為自由現金流，它將成為一個自由現金流機器。有投資者問我，那什麼時候會發生？好吧，如果我確切地知道什麼時候會預測價格，我就能說出什麼時候會發生，但我很高興它會在今年下半年發生。

And next year, we're projected to receive to achieve free cash flow at a breakeven all the way down to $45 oil, that is unprecedented, most companies can't even get their money back or have any kind of profit at $45 oil. If oil prices stay around $90 a barrel, we estimate our free cash flow to be in excess of $1 billion in 2024. This will allow us to completely pay down 100% of our outstanding debt next year. If we chose to do so, we could also increase our drilling program and prices stay in that $90 to $100 range, but the point is we will have excess free cash flow available on our balance sheet. So our investors can look at that and be excited about what's happening over the next 12 months or so. Even though I know Wall Street is usually quarter-to-quarter. We take a little longer-term view.

明年，我們預計將在收支平衡的情況下實現自由現金流，一直下降到 45 美元的油價，這是前所未有的，大多數公司甚至無法收回他們的錢或在 45 美元的油價下獲得任何利潤。如果油價保持在每桶 90 美元左右，我們估計到 2024 年我們的自由現金流將超過 10 億美元。這將使我們能夠在明年完全償還 100% 的未償債務。如果我們選擇這樣做，我們也可以增加我們的鑽探計劃，價格保持在 90 美元到 100 美元的範圍內，但關鍵是我們的資產負債表上將有多餘的自由現金流。因此，我們的投資者可以看到這一點，並對未來 12 個月左右發生的事情感到興奮。儘管我知道華爾街通常是按季度計算的。我們從更長遠的角度來看。

And on a separate note, I want to share with our shareholders to know that we are constantly monitoring the market volatility in commodity prices and service costs. We have the ability to be flexible with our drilling program. We could either increase or decrease our program, if necessary. We don't have any long-term contracts that can effectively mess us up, so to speak, and cause us to have what I call the perfect storm, high interest rates and low oil and gas prices. We're going to continue with that program. So in closing our last slide 15, this has kind of encapsulates what we've always talked about, contiguous acreage inventory, consistent well results, operational and environmental focus, leading margins in free cash flow and growth.

另外，我想與我們的股東分享，我們一直在監控商品價格和服務成本的市場波動。我們有能力靈活地處理我們的鑽井計劃。如有必要，我們可以增加或減少我們的計劃。我們沒有任何長期合同可以有效地把我們搞得一團糟，可以這麼說，並導致我們遇到我所說的完美風暴、高利率和低油氣價格。我們將繼續該計劃。因此，在結束我們的最後一張幻燈片 15 時，它概括了我們一直在談論的內容，即連續的種植面積庫存、一致的油井結果、運營和環境重點、自由現金流和增長方面的領先利潤率。

But looking at the value proposition here, you should look at this, and it kind of tells you why you should own HighPeak stock and to hold on to your stock for the ride relative to us continuing with our strategic alternatives. We have a large contiguous acreage position, providing for maximum capital efficiency. We have a tremendous amount of inventory debt where we've now proven the rock quality of this area. An inventory like this is a huge scarcity in our area. In fact, just noticed where one of the CEOs recently said it looks like the Permian is that peak production for only 5 years here.

但是看看這裡的價值主張，你應該看看這個，它告訴你為什麼你應該擁有 HighPeak 股票並持有你的股票相對於我們繼續我們的戰略選擇。我們有一個大的連續種植面積位置，提供最大的資本效率。我們有大量的庫存債務，我們現在已經證明了該地區的岩石質量。像這樣的庫存在我們地區非常稀缺。事實上，剛剛注意到其中一位首席執行官最近表示，看起來二疊紀是這裡只有 5 年的最高產量。

Our inventory is defined by consistent high-return results across more than 200 wells that we drilled today. Our development program is environmentally sound and physically rewarding, our high oil cut and low-cost operations truly lead to a differentiated peer-leading margins and these things lead to our projection of generating large amounts of free cash flow for years and years and years to come. All of that is from 1 vantage point today. In addition, we continue to improve all aspects of our business from repeatedly decreasing our lease operating expenses, improving our well performance and improving the number of formations that are economically sound, providing for long-term return on investment and additional upside to exceed our expectations.

我們的庫存由我們今天鑽探的 200 多口井的一致高回報結果定義。我們的開發計劃對環境無害且有實際回報，我們的高含油率和低成本運營真正帶來了差異化的同行領先利潤率，這些因素導致我們預測年復一年地產生大量自由現金流來。所有這一切都來自今天的一個有利位置。此外，我們不斷改善我們業務的各個方面，包括反复降低租賃運營費用、改善油井性能和增加經濟合理的地層數量，提供長期投資回報和超出我們預期的額外上升空間.

Considering these points, this is an extremely confident are confident in our ability to optimize shareholder value. That's what everything is about and to continue operating in the future and implementing the process for strategic alternatives. We talked about that process. It's a process providing optionality relative to merger relative to outright sale relative to refinancing and equity increases to increase shareholder value. So with that now i'll turn the program over to questions. If anybody has any questions, we're glad to answer now.

考慮到這些要點，這是對我們優化股東價值的能力的極度自信。這就是一切的目的，並在未來繼續運營並實施戰略替代方案的流程。我們談到了那個過程。這是一個提供相對於合併相對於直接出售相對於再融資和股權增加的選擇權以增加股東價值的過程。因此，現在我將把程序交給問題。如果有人有任何問題，我們很樂意現在回答。

(Operator Instructions) Our first question will come from John White of ROTH MKM Capital.

（操作員說明）我們的第一個問題將來自 ROTH MKM Capital 的 John White。

Congratulations on some very, very strong results. On the front page, I want to make sure I'm reading things right. On the front page of the press release, you say you extended development potentially to the Lower Spraberry into Borden County based on 3 Lower Spraberry wells. Are those wells addressed later in the presentation, the Conrad and the Griffin pads?

祝賀一些非常非常強大的結果。在首頁上，我想確保我閱讀的內容是正確的。在新聞稿的首頁，您說您基於 3 口 Lower Spraberry 井將開發可能擴展到 Lower Spraberry 到 Borden County。那些油井是否在介紹的後面提到，Conrad 和 Griffin 墊？

Yes, John. I mean, Mike will elaborate further, but it's always -- it's from the western part all the way over to the eastern part of the Conrad and Griffin wells, but go ahead, Mike can answer that.

是的，約翰。我的意思是，邁克會進一步詳細說明，但它總是——從西部一直到康拉德和格里芬井的東部，但繼續吧，邁克可以回答這個問題。

You bet. Yes, John, as we've picked up acreage up in the Borden County, the [Crocket] operating acreage that we picked up kind of that 6,500 acres, it was kind of our first 4-A and that we put on multiple acquisitions and leases from [them]. Most of that was predicated and underpinned by the Wolfcamp A activity that we have seen. You can notice that we've got much -- many more brand sticks drilled up in that area. The Wolfcamp A is phenomenal. It looks just like down south in the Flat Top. But as we started developing the Lower Spraberry and saw the results in Flat Top, the rock looked very similar up on this acreage in Borden.

你打賭。是的，約翰，因為我們已經在博登縣獲得了土地，我們獲得了 6,500 英畝的 [Crocket] 經營面積，這是我們的第一個 4-A，我們進行了多次收購，從[他們]那裡租來的。其中大部分是由我們看到的 Wolfcamp A 活動預測和支持的。你可以注意到我們在那個地區鑽了很多 - 更多的品牌棒。 Wolfcamp A 非常出色。它看起來就像平頂的南方。但是當我們開始開發 Lower Spraberry 並在 Flat Top 看到結果時，岩石在 Borden 的這片土地上看起來非常相似。

We extended up into where you see the bullet #3 on the Griffin pad and drilled 2 Lower Spraberry wells, wine rack with the Wolfcamp A. Those 2 wells look almost like a lay down to the Wolfcamp A in the area. So again, very encouraging and added an additional zone to that entire area. So then we stepped all the way out to where the Conrad is about 7 miles west or east of where we drilled the Griffin pad. And as Jack mentioned, the Lower Spraberry and Wolfcamp A there are phenomenal.

我們向上延伸到您在 Griffin 墊上看到子彈 #3 的地方，並鑽了 2 個 Lower Spraberry 井，帶有 Wolfcamp A 的酒架。這 2 個井看起來幾乎就像該地區的 Wolfcamp A 一樣。因此，再次非常鼓舞人心，並在整個區域中增加了一個區域。因此，我們一直走到 Conrad 位於我們鑽 Griffin 墊的地方以西或以東約 7 英里的地方。正如傑克提到的那樣，Lower Spraberry 和 Wolfcamp A 非常出色。

One is doing over 900 barrels a day and -- and that's just oil and 1 over 800 and it's very early in the cleanup cycle. So again, it gives us confidence that we can go in and infill between the 2 development areas and it's roughly another 75, 80 wells that we can feel very confident that in 2023 and '24, we'll be able to go to build that very machine-like development, very low cost, efficient and continue to drive these margins of.

一個是每天處理 900 多桶——那隻是石油，還有 1 個超過 800 桶，而且還處於清理週期的早期。因此，它再次讓我們有信心，我們可以在兩個開發區域之間進行填充，並且大約還有 75、80 口井，我們可以非常有信心在 2023 年和 24 年，我們將能夠建造它非常機器化的發展，非常低的成本，高效並繼續推動這些利潤率。

And looking on Slide 10, all the pink sticks for the Wolfcamp D, it looks like your confidence is increasing in the development of that zone in (inaudible)

看看幻燈片 10，Wolfcamp D 的所有粉紅色棒，看起來您對該區域開發的信心正在增加（聽不清）

Yes. Yes. The pink sticks on Slide 10 are the lower base Wolfcamp D, so we've drilled those across the entire acreage block. So very confident in the results we have with the lower base. We have seen some of our peers to the west and to the north of us. Drill a little shallower in the Wolfcamp B zone. We call it the 3 fingers. There's 3 little streams on the log that we're able to see much more brittle, should hold a frac better all of the geomechanics, geochemistry, (inaudible) analysis, all lend itself to suggest that those wells will be even better than the lower base D.

是的。是的。 Slide 10 上的粉紅色棒是較低的 Wolfcamp D 基地，所以我們已經在整個區塊上鑽了那些。所以我們對較低基數的結果非常有信心。我們已經看到我們西部和北部的一些同行。在 Wolfcamp B 區鑽得淺一點。我們稱之為 3 個手指。測井曲線上有 3 條小溪流，我們可以看到它們更脆，應該能更好地保持壓裂 所有地質力學、地球化學、（聽不清）分析，都表明這些井比較低的井更好基於。

So what we've shown here on the chart is where we've done the 3-finger test. We drilled some of the wells. We fracked some of the wells and look to have results here in the next month, 1.5 months. So over the next few quarters, we'll be able to update you on that shallower zone of [Pan D]

所以我們在圖表上顯示的是我們完成三指測試的地方。我們鑽了一些井。我們對一些井進行了水力壓裂，並希望在下個月，即 1.5 個月內在這裡取得成果。因此，在接下來的幾個季度中，我們將能夠向您更新 [Pan D] 的較淺區域

We also walked through some Wolfcamp C [huddle] tests, very similar in nature. We've got 1 drill out about to come online and a couple of others that we're drilling today. so that we're, again, give us another quarter or 2, and we'll be able to present to the Street. And like Jack mentioned, hopefully, we'll be able to move those from upside locations into our primary zone, our primary locations, again, just extending that runway of high rate of return inventory.

我們還完成了一些 Wolfcamp C [huddle] 測試，本質上非常相似。我們有 1 個鑽探即將上線，還有幾個我們今天正在鑽探。所以我們再次給我們一個或兩個季度，我們將能夠向華爾街展示。就像傑克提到的那樣，希望我們能夠將那些從上部位置轉移到我們的主要區域，我們的主要位置，再次只是擴展高回報率庫存的跑道。

Something that we've talked about in the past is the Wolfcamp A and Lower Spraberry. These all look very due to lower spread back. and 3 different test areas that we're drilling and completing those wells, (inaudible) little bit about the top line. So again, the next few quarters are going to be very (inaudible) for the inventory (inaudible) to be the difference in ['21] (inaudible) to that 20-year (inaudible) rate to be able to keep these kind of returns that we're showing today.

我們過去討論過的是 Wolfcamp A 和 Lower Spraberry。由於較低的回差，這些看起來都非常好。以及我們正在鑽探和完成這些井的 3 個不同的測試區域，（聽不清）關於頂線的一點點。因此，接下來的幾個季度將非常（聽不清）庫存（聽不清）將是 ['21]（聽不清）與 20 年（聽不清）利率之間的差異，以便能夠保持這種我們今天展示的回報。

(Operator Instructions) next question will come from Jeff Robertson of Water Tower Research.

（操作員說明）下一個問題將來自 Water Tower Research 的 Jeff Robertson。

Mike, on the Slides 9 and 10 with some of the pads you're showing, are any of those results additive to the inventory counts you show in a couple of slides later in the deck. And secondly, are you testing anything over the next couple of months that's not included in the locations that you show on the inventory side?

邁克，在幻燈片 9 和 10 上，你正在展示一些墊子，這些結果中的任何一個都會添加到你在後面幾張幻燈片中顯示的庫存數量中。其次，您是否在接下來的幾個月內測試了未包含在您在庫存方面顯示的位置中的任何內容？

So Jeff, all the locations that we have are in our inventory mix that we have shown in both the primary and the upside locations. What's going to happen here is as these wells are developed and prove up those zones. Again, we had to -- we were very, very conservative on those upside zones and what we felt that they may be able to provide. So again, with all of the all of the data that we have collected and what we truly expect out of these zones, they will absolutely move up into the primary numbers.

所以傑夫，我們擁有的所有位置都在我們的庫存組合中，我們在主要位置和上部位置都顯示了這些位置。這裡將要發生的事情是，隨著這些油井的開發和探明這些區域。同樣，我們不得不——我們對那些上行區域以及我們認為它們可能提供的東西非常、非常保守。因此，再一次，根據我們收集的所有數據以及我們對這些區域的真正期望，它們絕對會上升到主要數字。

So it will increase the primary numbers. But as far as adding to the total of the 2,500 that we have, all of these wells are captured in that. Now over time, as we develop more of these the areas that we had picked for where they would be upside will most likely expand and you'll see some growth in that 2,500 number. But that's kind of how we're attacking it, Jeff.

所以它會增加主要數字。但就我們擁有的 2,500 口井而言，所有這些井都被捕獲了。現在隨著時間的推移，隨著我們開發更多這樣的領域，我們選擇的優勢領域很可能會擴大，你會看到 2,500 個數字有所增長。但這就是我們攻擊它的方式，傑夫。

So it's based -- it's just continued derisking from the upside to the primary to move categories.

所以它是基於 - 它只是繼續從上行到主要移動類別的風險。

That's correct. And again, every time you go step out, you tend to move the box around where you thought an upside zone would be prospective.

這是正確的。而且，每次你走出去，你往往會在你認為可能出現上行區域的地方移動盒子。

A question just on delineation between -- that you show on Slide 12. Jack, you mentioned, I think, a 6% recovery factor that called [Gelesis] using your reserves. How does recovery factor on flat top and/or signal peak compared to the more central part or the western part of Howard County.

一個問題只是關於你在幻燈片 12 上顯示的 - 之間的劃分。傑克，我認為你提到了一個 6% 的恢復因子，稱為 [Gelesis] 使用你的儲備。與霍華德縣的中部或西部相比，平頂和/或信號峰值的採收率如何。

Jeff, that's a great question because everybody uses different recovery factors internally for their reserve bookings. It's typical for the majors to use that 6% recovery factor. Some of the smaller mid-cap companies to compare Western to Eastern is about a 2% difference running from 6% to 8% recovery factor. But as you can see, in evaluating 20 something wells out to the west to 1,700 going very quickly up to 1,800, 1,900 in the next 12 months. East is actually performing -- outperforming the wet.

傑夫，這是一個很好的問題，因為每個人都在內部使用不同的恢復因素來進行預訂。專業人士通常使用 6% 的恢復係數。一些較小的中型公司將西方與東方進行比較，回收率從 6% 到 8% 大約有 2% 的差異。但正如您所看到的，在評估 20 個東西時，在接下來的 12 個月內，西部的水井會增加到 1,700 個，很快就會增加到 1,800 個，達到 1,900 個。東區實際上表現出色——勝過濕區。

But the typical difference on a macro scale is about 2% difference, about 25% plus difference between West and East in terms of recovery factor and in terms of the size of the companies. But our -- we know it's going to increase and many companies are using up to 14% recovery factors even in our area. But we're just -- we're going to take a conservative approach and we're going to go with what we have as factual right now and use a conservative recovery factor. We can always add to and it gives a potential buyer the opportunity to book whatever they want to book in terms of reserves.

但宏觀尺度上的典型差異約為 2%，西方和東方在恢復係數和公司規模方面的差異約為 25% 以上。但我們——我們知道它會增加，許多公司甚至在我們地區也使用高達 14% 的回收率。但我們只是——我們將採取保守的方法，我們將按照我們現在所擁有的事實，並使用保守的恢復因素。我們可以隨時添加，這讓潛在買家有機會根據儲備預訂他們想要預訂的任何東西。

We don't have to worry about revisions and write-downs and impairments. We're just going to take a conservative approach and as long as we're getting a 150-plus percent increase on an annual basis, it doesn't really matter. As we delineate this year, it could be even higher recoveries because we might decide to step out further and have more PUD development than we did in this year's business. Hopefully, that is (inaudible)

我們不必擔心修訂、減記和減值。我們只是要採取保守的方法，只要我們的年增長率達到 150% 以上，這並不重要。正如我們今年所描述的那樣，回收率可能會更高，因為我們可能會決定更進一步，並且比今年的業務有更多的 PUD 開發。希望那是（聽不清）

It does. With respect to the revisions in this year's reserve report, I think before you all had shown maybe a 5 to 6 rig cadence from 2020 -- maybe beyond 2023. Is some of the revision to year-end reserves just related to how you're stacking up the current plan for 5-year development that was included in the December report.

確實如此。關於今年儲量報告的修訂，我想在你們都展示了從 2020 年開始可能有 5 到 6 個鑽井平台的節奏——可能在 2023 年以後。年末儲量的一些修訂是否與你們的方式有關？疊加 12 月報告中包含的當前 5 年發展計劃。

Yes. I mean it's very nominal anyway. And it's just a function of what we were in going to be drilling versus what we ended up designing to drill. And it is -- it's very conservative. We didn't consider that. We considered mainly just maximize the shareholder value and keeping a strong balance sheet.

是的。我的意思是無論如何它都很有名無實。這只是我們將要鑽探的內容與我們最終設計的鑽探內容之間的函數。它是——它非常保守。我們沒有考慮到這一點。我們主要考慮的只是最大化股東價值和保持強勁的資產負債表。

Last question. If HighPeak chose to drill more over '23 and '24, maybe just think about '24 and not be as conscientious about generating free cash flow from this asset. Mike or Jack, do you have an idea of what you could do not to outrun the existing infrastructure on this acreage space in terms of the number of rigs you might be able to run or how you think about operating?

最後一個問題。如果 HighPeak 選擇在 23 年和 24 年進行更多鑽探，也許只考慮 24 年，而不是認真地從該資產中產生自由現金流。 Mike 或 Jack，就您可能能夠運行的鑽井平台數量或您對運營的看法而言，您是否知道如何做才能不超過這片土地上的現有基礎設施？

We actually have -- at Flat Top, we have increased and added to our infrastructure, and of course, we have the ability as we drill additional wells out to the East. We are improving that infrastructure, we're improving our [lab] unit system and our tank battery system we designed everything with the ability to expand particular tank battery facilities. So if we decided to go back to 6 or 7 or 8 or even 10 rigs, with what we have planned in 2023 with Signal Peak, we could actually accommodate that without having to make major changes to our infrastructure. It would just be common add-ons that would fall into the $20 million to $30 million expenditures to add additional production. It's all now planned, Jeff, into the future to even meet -- almost doubling the capacity of our rigs.

實際上，在 Flat Top，我們已經增加並增加了我們的基礎設施，當然，我們有能力在東部鑽探更多的油井。我們正在改善基礎設施，我們正在改進我們的[實驗室]單元系統和我們設計的一切都能夠擴展特定坦克電池設施的儲罐電池系統。因此，如果我們決定回到 6 或 7 或 8 甚至 10 個鑽機，按照我們計劃在 2023 年使用 Signal Peak 的計劃，我們實際上可以適應這種情況，而無需對我們的基礎設施進行重大更改。這只是普通的附加組件，將屬於 2000 萬至 3000 萬美元的支出，以增加額外的生產。傑夫，這一切現在都計劃在未來甚至會面——幾乎將我們鑽井平台的容量增加一倍。

Check, that's we're having a continuous acreage in being basically the original developer of these zones on this acreage gives, a real infrastructure advantage to future development.

檢查一下，我們擁有連續的種植面積，基本上是這些區域的原始開發商，這為未來的發展提供了真正的基礎設施優勢。

No question. That is a major component of our position. We've developed this not to be critical of private equity but to be in consideration of building something long term for the future as a major company development that would make this an attractive asset to give optionality for a potential purchaser where they can control their destiny because the profit margins are so great here. They literally could move drilling rigs into this area and be able to improve on and improve their production and return on investment by focusing some of their capital in this area and growing it if they wanted to do so. They would have that luxury to do that.

沒有問題。這是我們立場的一個重要組成部分。我們開發這個不是為了批評私募股權，而是考慮為未來建立一些長期的東西作為一個主要的公司發展，這將使它成為一個有吸引力的資產，為潛在的購買者提供選擇權，他們可以控制自己的命運因為這裡的利潤空間太大了。他們實際上可以將鑽井平台移動到該地區，並能夠通過將部分資本集中在該地區並在他們願意的情況下進行發展來改善和改善他們的生產和投資回報。他們將有那麼大的奢侈來做到這一點。

And I am seeing no further questions in the queue. This will conclude today's conference call. Thank you all for participating. You may now disconnect, and have a pleasant day. The conference will begin shortly.

我沒有看到隊列中有其他問題。這將結束今天的電話會議。謝謝大家的參與。您現在可以斷開連接，並度過愉快的一天。會議將很快開始。