(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) |
(Address of Principal Executive Offices, and Zip Code) |
(Registrant’s Telephone Number, Including Area Code) |
(Former Name or Former Address, if Changed Since Last Report) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Exhibit Number | Title of Document | |
Press release dated April 16, 2020 |
Callon Petroleum Company (Registrant) | ||
April 16, 2020 | /s/ Joseph C. Gatto, Jr. | |
Joseph C. Gatto, Jr. | ||
President and Chief Executive Officer |
• | Operational capital spending of approximately $275 million |
• | Production between 100 and 102 MBoepd with an oil cut of 63% (three-stream basis) |
• | Lease operating expense between $54 and $56 million, or $5.95 to $6.15 per Boe2 |
• | Gathering, processing, & transport (“GP&T”) expense between $14 and $15 million, or $1.55 and $1.65 per Boe2 |
• | Unhedged realized oil, natural gas, and NGL prices are expected to be between $45 and $46 per Bbl, $0.55 and $0.65 per Mcf, and $10 and $11 per Bbl respectively |
• | Net cash from derivative settlements is estimated to be approximately $25 million for the quarter |
1 We have prepared the first quarter estimates in good faith based upon our internal reporting and accruals as of and for the three months ended March 31, 2020. Such estimates are preliminary and subject to change as we finalize our financial and operating data for the first quarter of 2020. Important factors that could cause actual results to differ materially are set forth under “Cautionary Statement Regarding Forward-Looking Statements.” | ||
2 Assumes production at the midpoint of the projected quarterly expectations range. |
• | The oil hedge portfolio now covers more than 16.5 million barrels of oil production for the remaining three quarters of 2020, nearly 85% of the expected production for the year. The oil hedge portfolio consists of swap agreements which are indexed to West Texas |
• | The Company has also mitigated locational risks related to oil sales, having hedged a majority of Midland and MEH crude basis exposure near parity to WTI. For the remaining three quarters of 2020, the Company has hedged approximately 6.5 million barrels of Midland-WTI basis at a weighted average price of -$1.23, and approximately 4.5 million barrels of MEH-WTI basis at a weighted average price of -$0.30. |
• | To further protect physical oil sales prices, Callon added over 25,000 Bbl/d of NYMEX WTI Roll swaps for May-September of 2020 at a weighted average price of -$1.67. Roll swaps provide protection against discounts to physical crude sales due to steep contango in the near-term forward month contracts. Sales price adjustments due to the shape of the near-term forward oil curve are a standard component of oil marketing agreements. |
• | Callon has also increased natural gas price protection: |
o | Approximately 50% of expected natural gas volumes for April 2020 to October 2020 are hedged under NYMEX Henry Hub contracts at a weighted average floor of $2.24/MMBtu. |
o | Approximately 30% of expected volumes for November 2020 to March 2021are hedged at a weighted average floor price of $2.45/MMBtu, with upside to nearly $3.00/MMBtu. |
o | 90% of Permian Basin gas sales for April 2020 to December 2020 are hedged at a Waha differential to NYMEX Henry Hub of -$1.08. |
2Q20 | 3Q20 | 4Q20 | 2Q-4Q 2020 | |
WTI NYMEX (Bbls, $/Bbl) | ||||
Swaps | ||||
Total Volumes | 5,177,900 | 5,400,400 | 5,072,420 | 15,650,720 |
Total Daily Volumes | 56,900 | 58,700 | 55,135 | 56,912 |
Avg. Swap | $41.78 | $42.65 | $44.18 | $42.87 |
ICE BRENT (Bbls, $/Bbl) | ||||
Swaps | ||||
Total Volumes | 182,000 | 184,000 | - | 366,000 |
Total Daily Volumes | 2,000 | 2,000 | - | 1,331 |
Avg. Swap | $46.15 | $46.15 | - | $46.15 |
NYMEX WTI VS ICE BRENT DIFFERENTIAL (Bbls, $/Bbl) | ||||
Swaps | ||||
Total Volumes | 396,800 | - | - | 396,800 |
Total Daily Volumes | 4,313 | - | - | 1,443 |
Avg. Swap | ($4.000) | - | - | ($4.000) |
MAGELLAN EAST HOUSTON FIXED PRICE (Bbls/$/Bbl) | ||||
Swaps | ||||
Total Volumes | 136,500 | 184,000 | 184,000 | 504,500 |
Total Daily Volumes | 1,500 | 2,000 | 2,000 | 1,835 |
Avg. Swap Price | $59.61 | $58.23 | $57.19 | $58.22 |
MAGELLAN EAST HOUSTON DIFFERENTIAL VS WTI-CUSHING (Bbls/$/Bbl) | ||||
Swaps | ||||
Total Volumes | 1,266,201 | 1,820,802 | 1,435,202 | 4,522,205 |
Total Daily Volumes | 13,914 | 19,791 | 15,600 | 16,444 |
Avg. Swap Price | ($1.220) | $0.08 | $0.03 | ($0.300) |
MIDLAND-CUSHING DIFFERENTIAL (Bbls/$/Bbl) | ||||
Swaps | ||||
Total Volumes | 1,965,600 | 2,217,200 | 2,392,000 | 6,574,800 |
Total Daily Volumes | 21,600 | 24,100 | 26,000 | 23,908 |
Avg. Swap Price | ($1.840) | ($1.130) | ($0.840) | ($1.230) |
NYMEX WTI CMA ROLL (Bbls/$/Bbl) | ||||
Swaps | ||||
Total Volumes | 1,383,500 | 2,484,000 | - | 3,867,500 |
Total Daily Volumes | 15,203 | 27,000 | - | 14,064 |
Avg. Swap Price | ($1.710) | ($1.650) | - | ($1.670) |
2Q20 | 3Q20 | 4Q20 | 2Q-4Q 2020 | |
NYMEX HENRY HUB (MMBtu, $/MMBtu) | ||||
Swaps | ||||
Total Volumes | 3,640,000 | 3,680,000 | 1,850,000 | 9,170,000 |
Total Daily Volumes | 40,000 | 40,000 | 20,109 | 33,345 |
Avg. Swap Price | $2.18 | $2.18 | $2.28 | $2.20 |
Three-way Collars | ||||
Total Volumes | 910,000 | 920,000 | 1,835,000 | 3,665,000 |
Total Daily Volumes | 10,000 | 10,000 | 19,946 | 13,327 |
Avg. Short Call Price | $2.75 | $2.75 | $2.73 | $2.74 |
Avg. Long Put Price | $2.50 | $2.50 | $2.46 | $2.48 |
Avg. Short Put Price | $2.00 | $2.00 | $2.00 | $2.00 |
Total NYMEX Volume Hedged (MMBtu) | 4,550,000 | 4,600,000 | 3,685,000 | 14,655,000 |
Average NYMEX Ceiling Price ($/MMBtu) | $2.29 | $2.29 | $2.50 | $2.35 |
Average NYMEX Floor Price ($/MMBtu) | $2.24 | $2.24 | $2.37 | $2.31 |
WAHA DIFFERENTIAL (MMBtu, $/MMBtu) | ||||
Swaps | ||||
Total Volumes | 6,097,000 | 6,624,000 | 6,261,000 | 18,982,000 |
Total Daily Volumes | 67,000 | 72,000 | 68,054 | 69,025 |
Avg. Swap Price | ($1.420) | ($1.030) | ($0.810) | ($1.080) |
WUO3W_ ,A= ]WTJW/9W_>7CWU(R/0^M71[>
M-U[6?]NL?1_Z-7OB9S,C8CTW78 *)ZO@'6/_ !79W_IUM_\ ;IR]_7@'6/\
MQ79W_IUM_P#;ER]_3>8VAY)Q;S_O/-?XQO\ Q%]3_J5_^?:EPW^*/_Q3Y/\
MX1L_\_8R[G_&-_XB^I_U*_\ S[4N&_Q1_P#BGR?_ C9_P"?L9''_,S\U3_G
M8^3Z\O(?\;G_ (J,;_PC7_Y^R5Z\O(?\;G_BHQO_ C7_P"?LE-Y?^<^B '!A8VME="!B
M96=I;CTB[[N_(B!I9#TB5S5-,$UP0V5H:4AZ D!\@'Z @,"
M# (4 AT")@(O C@"00)+ E0"70)G G$">@*$ HX"F *B JP"M@+! LL"U0+@
M NL"]0, PL#%@,A RT#. -# T\#6@-F W(#?@.* Y8#H@.N [H#QP/3 ^ #
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M'4<=:AZ4'KX>Z1\3'SX?:1^4'[\?ZB 5($$@;""8(,0@
M\"$<(4@A=2&A( &YXS'DJ>8EYYWI&>J5[!'MC
M>\)\(7R!?.%]07VA?@%^8G["?R-_A'_E@$> J($*@6N!S8(P@I*"](-7@[J$
M'82 A..%1X6KA@Z& ]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1POY>7_9?OP;_ /%POC/_ ._I
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M7/VV?NKFR[@4421O%7TI+WFGR#%E_+K)?D[_=>Z][]U[KWOW7NO>_=>ZT-?^%AO_ #.WX3_^
M(K[:_P#>MQ/O(+V6_P!P;_\ YJ1_\=;J%_=3_ ]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1P
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MZ]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW6L#_PK1_[=G]^+A]
M7_\ OJM]>Y6]GO\ E:9?^>:3_JY%U'?N;_RKT?\ S73_ (Y)U\X_WDQU O7O
M?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]
MU[W[KW6\%_PD ^2/DHOEI\0\K7\TU1M;Y%[%QQDN3'5)#UMVC4B-CP$:/:0&
MD ]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1M?@+_V
M77\*_P#Q;3XX_P#OXL-[)^8O^5?OO^>>;_JVW1GLO_)9M/\ FM%_Q]>OL<^\
M*>LJ^O>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=
M>Z][]U[K1Z_X60?\7+^7A_U _*S_ *W]<>YY]E/AW+[;?_K-U#WNM\5C]DW_
M %BZTEO<2Z1[_2=Z=I9M=O9Z;_WMBW_ /&3:;/KIG \5,HK'P])EW_H
MY7?K7@>C]0_JK;'T6F?_ $(K^U?^BU/ \,<8_>_@Q3'%*9_=V>S_ ,676,[J
MOU=?]NM-]V)D.QVVO)+W,#*KJS:]WTWM];T]_P#(77+SC_$W<3C]6Q^S+:;!
M_;8]G_HA>CJKE%3D&>!N(/@^ ]8<[_G=G#<8_:MNDG_N2Y>_+P#K'_BNSO\
MTZV_^W3E[^I.8VAY+,6\_P"\\W_C&)'U+ZG&GLKX_P"-J7#?XHW./UGR9)/Z
MC9R9_P +C+N/\8W_ (B^I_U*_P#S[4N&_P 4?_BGR?\ PC9_Y^QD\ ,S\U
M3_G8^3Z\O+O\;?6.H-ZCC='JM=5AG'&1:QA+?4<]]E0;=M/OKK]#V5_R_P"H
MO45Y#_C<_P#%1C_^$:__ #]DIF Y!:O]:NL6\[;W,_[:8RC_P!%+MOK
M_B.I_P 7G1ZH_HC\0.\HHLQ_^J>O/>O/^U=;ZF]FOVC,R"W^W<\-7KW^,NEI
M^I6; _F74.:/"+J6_P#4.5J9HX@P1U]QY;_$Y>&]1ZIC_P"DIIL_[;=:S_T>
MO4UX_P#XI; SZTW,)CU,*P >);9CN_ZGKX!UC_P 5V=_Z
M=;?_ &ZB3=5;7R;[Z1R%;(1"CS[OH*:GR.%$S
MV;__(W
M>\-4\COB
W/*.Y UM1 Q_%"3'3[%'Z?[4/0CL>>.9;$
MBEP95'E* ]?]L>_]C#K9;^%7_"LKX^=E5>(V=\U^ILM\>L_5-!22=I]>29/L
M/J:6H<@25N:VYXCN+"PW.E4IDS-K:I)HUOIB[??9_
##T]&'X6!&<$Y)[%
MO=KOVWK?6V#P=?-&'%3_ (0?,$''#H]'L@Z.>O>_=>Z][]U[KWOW7NO>_=>Z
M][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW
M7NO>_=>Z][]U[KWOW7NO>_=>Z SY*?(WJ;XE=']A_(7N_
W.VC;>4
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MO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=:2'_ L#^053'3?#_P"*V-KF
M6DJ9=[]_[SQPD],LU(J]=]:U9B7_ % EW6EVX]0T_1O<[>R^W"M[N[#(TPJ?
MM[W'\H^HA]T[XTM=M4X.J5A_QE/^?^M(#W/'4/\ 7O?NO=>]^Z]U[W[KW7O?
MNO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U
M[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]TL^N=^[DZK["V)V?LVM;&[OZXWE
MM??NU]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1M?@
M+_V77\*__%M/CC_[^+#>R?F+_E7[[_GGF_ZMMT9[+_R6;3_FM%_Q]>OL<^\*
M>LJ^O>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>
MZ][]U[K1Z_X60?\ %R_EX?\ 4#\K/^M_7'N>?93X=R^VW_ZS=0][K?%8_9-_
MUBZTEO
]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1M?@+_V77\*_P#Q;3XX_P#OXL-[
M)^8O^5?OO^>>;_JVW1GLO_)9M/\ FM%_Q]>OL<^\*>LJ^O>_=>Z][]U[KWOW
M7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[K1Z_X60?\7+^7
MA_U _*S_ *W]<>YY]E/AW+[;?_K-U#WNM\5C]DW_ %BZTEO
]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1M?@+
M_P!EU_"O_P 6T^./_OXL-[)^8O\ E7[[_GGF_P"K;=&>R_\ )9M/^:T7_'UZ
M^QS[PIZRKZ][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>
MZ][]U[KWOW7NM'C_ (6/NARO\O*,,#(F/^53LOY"25/72HQ_P)5@/];W//LH
M.S
_=>Z][]U[K0U_X6&_\ ,[?A/_XBOMK_ -ZW$^\@O9;_
M '!O_P#FI'_QUNH7]U/]S+/_ $C_ /'EZTV_
]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1BOA__ -E:_%W_ ,6*
MZ2_]^7C/99O7_)'N_P#FC+_QQNE^U?\ )3MO^:L?_'QU]F3WA)UE?U[W[KW7
MO?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=:*/_
M L4_P"9D_!'_P ,?OO_ -WVUO<_^RO^XNX?Z>+_ 2=0U[J?[D67^ED_P *
M=:7_ +F_J)NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z$7I__ )FU
MU=_XD79/_O2TWM+>_P"X]^Z]U[W[KW7O?NO=>]^Z]U[W[KW1BOA__ -E:_%W_
M ,6*Z2_]^7C/99O7_)'N_P#FC+_QQNE^U?\ )3MO^:L?_'QU]F3WA)UE?U[W
M[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=>]^Z]U[W[KW7O?NO=
M:*'_ L4(_TD_!$7%QL?OLD?FQSVUK&W^P]S_P"RO^XNX?Z>+_!)U#7NI_N1
M9?Z63_"G6F![F_J)NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z$[I
M.))^YNHX)+Z)NSMA1/I-FT2;JI$:Q_K8^TM^:6,Q_H/_ ,=/2BS%;N(?TU_X
M\.OM0>\&^LMNO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWOW7NO>_=>Z][]U[KWO
MW7NM8'_A6C_V[/ZX_P#%P^K_ /WU6^O