Marking EP Energy’s encore visit to our firm-wide TPH CEO Luncheon series, Mr. Smolik’s participation was perfectly timed and gave us the opportunity to hear more about what has kept EPE busy since the team’s initial visit in 2014. We were reminded of the company’s focus and structure established by Mr. Smolik and his team long before the 2012 transition into a private entity, the organization’s continued transformation through the 2014 IPO including ~$2B in international disposals, and the progress that has been made since which includes monetizing the Haynesville to become more oil-focused in the Midland, Eagle Ford, and Altamont. The importance of continuous optimization embedded in the organization’s culture is reflected in the recent bounty of constructive announcements – productivity estimates have increased, while costs have decreased; favorable amendments to existing royalty agreements have been secured; and multiple avenues to improve the capital structure have been opportunistically accessed. Most recently, EPE has positioned itself to capitalize on this newfound momentum and further demonstrate the strength of its portfolio through a value-accretive drilling JV and improving efficiencies realized by data-driven enhancements. Should commodity prices warrant, the company remains ready to further accelerate to bring forward value, supported by (i) hedge protection against any protracted near-term weakness and (ii) the potential to continue its track record of successful portfolio management.
Jeoffrey Lambujon, Bill Baerg, Brent Smolik, Clay Carrell, Jamaal, Dardar
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