CNX Resources Corporation (NYSE:CNX) Q3 2023 Earnings Call Transcript

Ravi Srivastava: Yeah. It’s more of our internal production of what we expect the pricing to be. There’s a mix of long-term contracts in certain arenas. And then there’s certain other programs where the pricing and volume kind of fluctuate in some of the arenas. It’s a mixed bag of those kinds of opportunities. But it’s — our $75 million to $100 million is based on where we see, how the different opportunities kind of shake out.

Leo Mariani : Okay, that’s helpful. And then just on, kind of the remainder of the year. I guess you guys are saying that CapEx in production are at the higher end here. As I’m looking at kind of year-to-date CapEx for the first three quarters. And I look at this right that you’ve got about $100 million left to spend in 4Q, which is kind of roughly half of what third quarter levels are. So are you seeing just limited operational activity in the fourth quarter? And similar question on the production. I mean, I can get kind of the, the high-end of the guide, but I guess that assumes that production can even come down a little bit in 4Q versus 3Q. I just want to verify that I’m kind of looking at these numbers, right, that you’d expect, like CapEx to be kind of cut in half in 4Q and any production tails off a little this quarter?

Alan Shepard: Yeah, that’s right. You’re going to see a significant decline in CapEx in Q4. What we talked about there during the commentary was the completion team, it’s just been so efficient that we pulled basically 11 of the 13 remaining fields in the second half the year came into Q3, that’s also driving kind of the production bump. But if you think about it, basically, we got one rig running. And we’ve kind of had to slow down to almost idle to frack crew, because we’ve been had a schedule. And we don’t want to push volumes into this market, given current prices. So we are just way ahead of schedule and you will see a big drop in Q4 capital next quarter.

Leo Mariani : Okay, now, that’s very helpful guys. And then just on the production, just to follow up there. So if I look at third quarter production, I mean, it looks like it’s around a 570 Bcf annual run-rate in 3Q, a little bit lower than your ’24 guide, of 580 Bcf. And I guess, production is coming down slightly here in fourth quarter. What’s the kind of plan? Is there a plan for early ’24, where you call this make it up but you’re ramping up activity on January 1st to try to get those volumes up to that 580 B level? Is that kind of the high level operating plan here to kind of get back after it right when the year turns?

Alan Shepard : And so if you think about the operating plan that we mentioned, we have a continuous drilling program ongoing, right. And it’s really just timing on the fracks, fracks is kind of biggest spend on the D&C side. So right now, we slowed down the completion activity, because we’re ahead of schedule. And next year, the 580 is going to come and go for the year. We’re not going to providing specific volume guidance quarter-by-quarter, but the way to think about it now, is we we’ve mentioned before, we’re trying to get to kind of this 1.59-1.6 run-rate, that’s where we’re at, and that’s where you should roughly expect to see volumes through next year.

Leo Mariani : Okay, thanks, guys.

Operator: The next question comes from Michael Scialla with Stephens. Please go ahead.

Michael Scialla : Yeah, hi. Good morning. Just one on the New Tech. Just trying to understand the revenue generation there. Most of the revenues or I guess, maybe all the revenues be, are they generated with the alternative energy credits associated with the power plant? Or are there any other credits that you are able to generate by abating the methane?