Coterra Energy Inc at Barclays CEO Energy Power Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Wei Jiang - Barclays - Analyst : It's always a treat. Well, from my lens, it really feels like operations are doing really well. Coterra, you guys have been beating the numbers left and right, by our count seven out of eight quarters, been beating oil numbers. Has that surprised you to the upside? Are you surprised by how well just operations are performing?

Question: Wei Jiang - Barclays - Analyst : That's great. Maybe -- I can come back to it. So there's the one question that comes a lot when it comes to the Coterra story is the diversified business model, less so on the geographic front but more on the gas and oil diversification that it's -- and as a result, almost like despite the really great operations, Coterra still trades at a discount to the gas companies and still trades at a discount relative to some of the large-cap E&Ps. So do you think you're getting the full benefit of the diversified business model? Like, what are the metrics that you look at to define it and how you think about the success of this type of diversification?

Question: Wei Jiang - Barclays - Analyst : That's great. And then so another question that comes up more frequently is the -- I would say the perception of the accretive nature of the company. You often say that Coterra doesn't have a problem to solve. So how do you think about the value of M&A versus organically buying back your shares?

Question: Wei Jiang - Barclays - Analyst : Value-added opportunity. So what criteria do you look at when you evaluate these types of opportunities? Like, how do you narrow down the opportunity set?

Question: Wei Jiang - Barclays - Analyst : Makes sense. Do you find duration being a more difficult aspect to meet in value?

Question: Wei Jiang - Barclays - Analyst : Back to buyback, you have returned over 100% of your free cash flow in the first half of the year and also having one of the best balance sheets in the sector. Is there any reason to stockpile cash? Or is that more -- that free cash flow is more likely to come to the shareholders?

Question: Wei Jiang - Barclays - Analyst : And I show by action instead in -- it's so far so good. So far so good. Sort of on the capital allocation question, I think you've also talked about Coterra as being more capital constrained rather than opportunity constrained. As you look out in the current macro price environment, how do you balance growth versus CapEx? And that's especially related to some of the efficiency gains that you were seeing sort of tying that to that three-year outlook that assumes some level of modest growth. So how do you think about putting capital into the --

Question: Wei Jiang - Barclays - Analyst : Got it. As you look out in the current macro environment, a lot of uncertainty today. Is there any reason for you to -- and you talked about your nimble asset allocation process. Any reason to deviate change much from, I guess, what you saw earlier in the year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 04, 2024 / 5:15PM, CTRA.N - Coterra Energy Inc at Barclays CEO Energy Power Conference

Question: Wei Jiang - Barclays - Analyst : Yeah. You have talked about $2 in-basin pricing as a threshold to bring some of the deferred tilts in the Marcellus online. Why even grow? Why even at that level? Like, given the -- like would you want to wait for even better pricing before you will put capital back?

Question: Wei Jiang - Barclays - Analyst : Makes sense. Putting into the Permian that we're watching the Windham Row closely. So it's been tracking ahead from timing perspective. How is it performing? And based on what you're seeing from the performance of Windham Row, how is that informing how you want to develop the next round development in Culberson? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 04, 2024 / 5:15PM, CTRA.N - Coterra Energy Inc at Barclays CEO Energy Power Conference

Question: Wei Jiang - Barclays - Analyst : With the simul-frac, what percentage of Windham Row did it account for?

Question: Wei Jiang - Barclays - Analyst : Going forward, more likely to get through.

Question: Wei Jiang - Barclays - Analyst : That's great. Maybe moving to Anadarko. It's not a basin that we get a lot of operator talking about the performance in Anadarko but Coterra has seen some strong results. And you've talked about the learnings that you have made over the past few years to get more consistent results. So how do Anadarko Basin compete now in the portfolio? And how do you think about capital allocation in that basin?

Question: Wei Jiang - Barclays - Analyst : Do you think you have enough scale there to fully optimize your operations and do what you think you could get out of that asset?

Question: Wei Jiang - Barclays - Analyst : Got it. And the value. This is an open-ended question, and I look forward to asking you this question. But if you -- open ended, looking out three to five years, where do you think -- what assets or aspects that makes you most excited about the Coterra story?

Question: Wei Jiang - Barclays - Analyst : Appreciate you bringing that up, and it is very important. And thank you for doing the right things. So thank you very much, Tom, for this conversation.