Oasis Petroleum First Quarter 2022 Results

Oasis Petroleum Inc. announced financial and operating results for the quarter ending March 31, 2022.

1Q22 Operational and Financial Highlights:

• Produced 69.6 MBoepd in 1Q22 with oil volumes of 45.0 MBopd, both above the high-end of February guidance;
• E&P CapEx was $62.9MM in 1Q22, below the low-end of February guidance;
• LOE and GPT costs trended below the low-end of guidance. Cash G&A was below guidance when adjusting for approximately $4.1MM of transaction related items;
• Net cash provided by operating activities was $265.6MM and net loss from continuing operations was $19.6MM;
• Adjusted EBITDA from continuing operations⁽¹⁾ was $287.4MM and Adjusted Free Cash Flow⁽¹⁾ was $217.5MM;
• Received $13.1MM distribution from Crestwood in February 2022, which is included in Adjusted EBITDA⁽¹⁾;
• Cash of $410.2MM exceeded $400.0MM of debt as of March 31, 2022;
• Continued focus on ESG and sustainability. Oasis North Dakota gas capture continues to be above peers. Additionally, safety performance continues to improve and the company had a low incident rate in 1Q22;
• Declared a base dividend of $0.585 per share of common stock. The base dividend will be payable on June 1, 2022 to shareholders of record as of May 20, 2022;
• Declared a variable dividend of $2.94 per share of common stock. The variable dividend will be payable on June 15, 2022 to shareholders of record as of June 1, 2022;
• Oasis and Whiting Petroleum Corporation ("Whiting") continue to make progress and expect the merger (the "merger") to close in 3Q22. Oasis and Whiting each filed a premerger notification and report form under the HSR Act, and the waiting periods with respect thereto have expired. Oasis filed a registration statement on Form S-4 (the "Registration Statement") on April 28, 2022.

Danny Brown, Oasis' Chief Executive Officer, said: "The first quarter was transformational for Oasis, while also exhibiting very strong operational performance. The closing of the Crestwood and Oasis Midstream Partners merger created a premier midstream company while enhancing value for Oasis and increasing transparency to the core E&P business. Additionally, the announced merger-of-equals with Whiting Petroleum will create a company with enhanced scale, poised to deliver strong returns and significant free cash generation while operating in a safe and sustainable manner. Operationally, Oasis had strong execution in the first quarter, exceeding volume expectations and keeping costs in check, which supported robust free cash generation. My thanks to all of our employees who made the quarter possible through their hard work and dedication. As we look forward, we remain focused on our core strategy, which emphasizes capital discipline and shareholder returns, and on integration planning associated with the announced merger."

Financial and Operational Update and Outlook

The following table presents select operational and financial data for 1Q22 and guidance for 2Q22, which reflects the severe winter storms that went through North Dakota in April. While the near-term impact on production is meaningful, the Company's previous 2022 annual guidance of 65 - 70 MBoepd remains intact. Metrics reflect the Company's continuing operations and exclude amounts reported as discontinued operations due to the OMP merger. Oasis expects to update its full year guidance for the combined company after the merger with Whiting and is currently providing guidance for 2Q22 for Oasis on a stand-alone basis.

The following table presents the Company's total capital expenditures ("CapEx") from continuing operations by category for the periods presented:

Oasis declared a base dividend of $0.585 per share ($2.34/share annualized) to shareholders of record as of May 20, 2022, payable on June 1, 2022. Additionally, Oasis declared a variable dividend of $2.94 per share to shareholders of record as of June 1, 2022, payable on June 15, 2022. The base dividend and variable dividend are in connection with Oasis' previously announced plan to return $70 million of capital to shareholders per quarter.

The following table presents key balance sheet statistics and liquidity metrics as of March 31, 2022 (in millions):

 On May 3, 2022, the OAS lenders reaffirmed a $900MM borrowing base with the elected commitments remaining at $450MM. At the close of the merger, the borrowing base is expected to increase to $2B with $800MM of elected commitments.

 

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