Evolution Petroleum: a dividend paying company with a debt-free balance sheet – exclusive interview with EPM CFO David Joe
The downturn in oil prices proved a difficult storm to weather for much of the industry. Companies that had levered up while oil was over $100 per barrel were suddenly left without a life-raft when the price ship sank, but for Evolution Petroleum (ticker: EPM) debt was not a problem, and hasn’t been for over a decade.
The Houston-based company has carried zero-debt on its balance sheet since 2006, just one of the features that makes the company unique compared to many of its E&P competitors, Evolution Petroleum CFO David Joe told Oil & Gas 360®.
“We’re quite a bit different from most E&P companies once you start to peel the layers of the onion back,” Joe said. “For a public company, we’re uniquely small and lean, and we’ve been cash flow positive for the last five to six years, while reporting net income over the same period. Not many companies can tout that over this extended downturn.”
About three years ago, the company made the decision to return free cash flow back to investors, rather than investing in new drilling ventures. Evolution has been generating enough free cash flow to further develop its Delhi Field asset, and increase its dividend, Joe explained.
EPM’s Delhi Field asset produced 195 MMBO prior to enhanced oil recovery (“EOR”), and the asset has produced an additional 13.2 MMBO after EOR was instituted. The company is also in the process of ramping up a recently completed NGL Plant to full capacity, which should further increase production from the prolific asset.
“The new NGL Plant is designed to strip methane out of the reservoir, which will be used to generate electricity for the field and will increase the efficiency of the CO2 flood and thus the oil rate,” said Joe. “We’ll also be selling NGLs, which will further increase our total produced volumes.”
Evolution is currently evaluating for additional ways to deploy capital and investments, Joe told Oil & Gas 360.
Learn more about what is ahead of Evolution Petroleum in Dallas, March 2
Evolution Petroleum will be presenting its story at the Tower Club Downtown Dallas on Thursday, March 2, as part of EnerCom Dallas, an investor conference which is modeled after EnerCom’s The Oil & Gas Conference® in Denver.
The Dallas conference is designed to offer investment professionals a unique opportunity to listen to a wide variety of oil and gas company senior management teams update investors on their operational and financial strategies and learn how the leading independent energy companies are building value in 2017.
The forum offers healthy dialogue and informal networking opportunities for attendees.
To sign up for EnerCom Dallas and hear Evolution, or to find out more information about presenting companies at EnerCom Dallas, click here to visit the conference website.
Buyside institutions wishing to have one-on-one meetings with Evolution and other presenting company executives may login at the conference website and request meetings.