Enerplus Corporation (NYSE:ERF) Q2 2022 Earnings Conference Call August 5, 2022 11:00 AM ET

Company Participants

Drew Mair - Manager, Investor Relations

Ian Dundas - President and Chief Executive Officer

Wade Hutchings - Senior Vice President and Senior Chief Operating Officer

Jodi Jenson Labrie - Senior Vice President and Chief Financial Officer

Shaina Morihira - Vice President, Finance

Garth Doll - Vice President, Marketing

Conference Call Participants

Patrick O’Rourke - ATB Markets

Greg Pardy - RBC Capital Markets

Jamie Kubik - CIBC

Operator

Good morning, ladies and gentlemen and welcome to Enerplus Q2 2022 Results Conference Call. [Operator Instructions] This call is being recorded on August 5, 2022. I would now like to turn the call over to Drew Mair, Manager of Investor Relations. Please go ahead.

Drew Mair

Thank you, operator and good morning everyone. Thank you for joining the call. Before we get started, please take note of the advisories located at the end of our second quarter news release. Our financials have been prepared in accordance with U.S. GAAP. Our production volumes are reported on a net after deduction of royalty basis and our financial figures are in U.S. dollars unless otherwise specified. I am here this morning with Ian Dundas, our President and Chief Executive Officer; Wade Hutchings, Senior VP and Senior Chief Operating Officer; Jodi Jenson Labrie, Senior VP and Chief Financial Officer; Shaina Morihira, VP, Finance; and Garth Doll, VP, Marketing. Following our discussion, we will open up the call for questions.

With that, I will turn it over to Ian.

Ian Dundas

Thank you, Drew. Good morning everyone. Our second quarter results and updated 2022 outlook reflects strong operating momentum and disciplined capital allocation. For the second consecutive quarter, we are increasing our annual volume guidance due to well performance and efficient execution. We believe this outperformance is particularly evident considering the impacts to our production from the severe weather in the Bakken we spoke to last quarter and the recently announced sale of assets in Canada. Combined, these events have impacted our annual production by almost 2,000 BOE per day, yet we have increased our production guidance by 1,500 BOE per day since our initial 2022 guide released in February. This has set us up for a very robust second half of the year where we expect a significant production and cash flow growth.

We also continue to operate within our capital guidance range of $400 million to $440 million as our approach to procurement, focus on cost control and strong execution, are helping to mitigate to many of the inflationary pressures we are experiencing. We generated over $325 million of free cash flow through the first 6 months of the year, which we expect to increase by an incremental $475 million in the back half of the year based upon rest of year prices of $90 TI and $6.50 NYMEX gas.