PDC Energy, Inc. (NASDAQ:PDCE) Q4 2022 Earnings Call Transcript

Bart Brookman: Yes. And I’m probably in the same range, just thinking through this. We also have some non-production related capital built into our $1.4 billion , you got to peel that out. Then you have to say, what does it take to keep it flat basically for a few years. And yes, we’re probably in that $1.1 billion range, maybe a little higher.

John Abbott: Appreciate, thank you for the color.

Operator: And our next question comes from Noel Parks of Tuohy Brothers and Investment Research. Your line is open.

Noel Parks: Hi, good morning.

Bart Brookman: Good morning.

Noel Parks: I apologize if you touched on this already. But I just wondered, can you talk €“ well, in the current environment where we’re seeing oil and gas prices diverge again in sort of a bit of deja vu from past cycles, do you have any updated thoughts on the outlook for the NGL market specifically?

Bart Brookman: Lance, do you want to cover this?

Lance Lauck: Yes. I think where we sit right now in NGLs, with propane storage filling up, we’ve seen some pressure on propane prices. We’ve seen some pressure on NGL prices as well. I think a lot of the NGL prices are tied to weather, to agriculture. It’s also tied to kind of the overall growth of the country as well over time. So, I think look for them to kind of be in the range we’re sort of seeing right now, sort of for PDC sort of what we’re using for budget around the $20 realized price, which, by the way, includes a reduction for the fees that are paid to DCP Midstream, so around that $20 per barrel in general. But look for it to hopefully pick back up here with increases in gas demand, which may be a year or two out.

So part of the oversupply a little bit on NGLs right now is the fact that natural gas in the country is pretty strong, over 100 Bcf per day. So there’s just more liquids that are being taken out of the gas, and that supply has increased because of the increase in gas volumes. So look for the continued focus on how NGL prices are being €“ are based upon the supply and demand of natural gas and then the overall growth of the country through that time. So it may be a little bit €“ another year or two before we see some strength in the NGL prices, but that’s something we’ll continue to monitor as we go forward here.

Noel Parks: Okay. Great. Thanks a lot.

Operator: And I’m showing no further questions at this time. I would now like to turn the call back to Bart Brookman, and that’s President and CEO, for closing remarks.

Bart Brookman: Yes. Thank you, Tanya, and thank you, everyone, for those who are still on the call for joining us today. And hopefully, we provided some good color on the quality of our plan and our inventory and our outlook not only for 2023 but future years. Appreciate you joining.

Operator: Ladies and gentlemen, this concludes today’s conference. Thank you for your participation. You may now disconnect.