Ring Energy recently provided an operational and financial update for the company’s 1Q 2022 sales. Also, its drilling program, and further debt payment.
Moreover, the reported first quarter 2022 sales volumes were of approximately 8,870 barrels of oil equivalent per day; ~ 85% oil. This was above the high end of first-quarter guidance. The company reported that improved sales were driven by several factors. For example, placing wells on production sooner than anticipated; production optimization with field compressor installs that led to an overall increase in gas sales.
In addition, Ring Energy generated free cash flow for the 10th consecutive quarter and paid down an additional $10 million in debt in the first quarter 2022. Moreover, it increased liquidity on March 31, 2022 to approximately $71 million and decreased the total outstanding debt balance to $280 million. The company benefitted from increased commodity prices with the majority of its low-price legacy oil hedges expiring at year-end 2021 and no natural gas price hedges in place in 2022.
Mr. Paul D. McKinney, Chairman of the Board and Chief Executive Officer, commented, “We are pleased with our first-quarter results. Our operations teams continue to perform efficiently and effectively maintaining our base production and bringing on new development wells ahead of schedule. The combination of stronger than anticipated sales, improved commodity prices, and our continued focus on driving cost efficiencies enabled us to not only generate free cash flow for a 10th consecutive quarter, but also allowed us to pay down $10 million in debt during the quarter. In addition to drilling and completion efficiencies, we continued our successful CTR program by performing four conversions. Our performance this quarter establishes a solid foundation for 2022 and encourages us to continue executing on our value-focused, proven strategy.”
Furthermore, the company reported the drilling of six wells. Four Central Basin Platform (“CBP”) and two Northwest Shelf (“NWS”) during the first quarter. They also completed and placed on production four CBP wells; and performed four conversions from electrical submersible pumps to rod pumps (“CTR”), all in the NWS.
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About Ring Energy
Ring Energy is an independent oil and gas company. Ring Energy focus is on the acquisition, exploration, and development of high-quality, oil and liquids-rich assets in the Permian Basin of Texas and New Mexico.