ARC Resources Ltd Q3 2024 Earnings Call Transcript

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

Question: Michael Harvey - RBC Capital Markets - Analyst : Yeah, sure, good morning everybody. Just a couple for me. I guess the first one maybe for Lara or Armin. I mean just wondering if you could give us some early color on the well performance at Attachie. I know we're kind of early days here, but just anything like number of wells currently producing to hit that 20,000 initial IPs, condensate ratios, that kind of stuff would be helpful to the extent you can provide any high-level detail. And then the second one, maybe for Ryan or others. Has LNG Canada given you any indication of when they might start taking your Sunrise gas into Phase 1? And maybe just remind us what kind of effect that will have on your pricing realizations at the point that, that does happen. That's it for me.

Question: Michael Harvey - RBC Capital Markets - Analyst : Got you. Thanks for the comments guys.

Question: Kalei Akamine - BofA Global Research - Analyst : Hey, good morning guys. Thanks for getting me on. For my first question, I want to address the soft gas market in AECO. Can you talk a little bit more about your plan to manage this winter? Why not just keep Sunrise off for an extended period, perhaps until Canada LNG helps shift the market into a new balance? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 07, 2024 / 3:00PM, ARX.TO - Q3 2024 ARC Resources Ltd Earnings Call

Question: Kalei Akamine - BofA Global Research - Analyst : Kris, I appreciate that. I guess the rub here is that condensate players like you don't need a high gas price to get your economics to work. But gas is still going for a pretty cheap price. So kind of thinking about your business commercially, what options do you have to get more gas out of basin? This quarter, one of your US peers announced a new LNG agreement on an existing facility as somebody seemingly gave up their space. Wondering if you're seeing similar opportunities on the market? And if you were, would you lean into it?

Question: Josh Silverstein - UBS Securities LLC - Analyst : Yeah, thanks. Good morning guys. It's Josh Silverstein at UBS. Great to see the start-up at Phase 1 at Attachie. On the site and some of the comments today, you talked about the next focus, which would be on Phase 2. Lessons learned from Phase 1, might you be able to apply to Phase 2 for either faster development or the ability to leverage the existing infrastructure that's there for lower costs? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 07, 2024 / 3:00PM, ARX.TO - Q3 2024 ARC Resources Ltd Earnings Call

Question: Josh Silverstein - UBS Securities LLC - Analyst : Got it. That's helpful. And then just on the Kakwa productivity uplift. This is a big asset. I'm curious if the uplift you're seeing or the improvements you're seeing are concentrated in one area? Is it across the basin? And how you're thinking of maybe shifting your program next year relative to 2024 to take advantage of some of the productivity? Thanks.

Question: Josh Silverstein - UBS Securities LLC - Analyst : Got it. Thanks, guys.

Question: Travis Wood - National Bank Financial, Inc. - Analyst : Yeah. My question was asked, but it sets up well with the last question, just as a follow-up. Armin, you kind of talked about the infrastructure spend, the strategic planning around Phase 1 and Phase 2. But can you help us quantify what that would mean on an efficiency capture? So obviously, the adds at Attachie are highly efficient on a capital efficiency measure for 2025. What kind of compression could that look like with the cost savings on the infrastructure spend from Phase 1 and Phase 2 for the future volumes as a percentage or if you think there's a better way to think about that? Just trying to figure out the efficiency gain on that production add for the Phase 2 volumes. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 07, 2024 / 3:00PM, ARX.TO - Q3 2024 ARC Resources Ltd Earnings Call

Question: Travis Wood - National Bank Financial, Inc. - Analyst : That's perfect, really appreciate that detail. That's all for me.

Question: Patrick O'Rourke - ATB Capital Markets Inc. - Analyst : Good morning guys. Thanks for the comprehensive rundown. I think you've touched on a lot of the operational and reservoir related questions. I guess this would be a little bit more on the strategic side in terms of return of capital plan. Obviously, you've raised the dividend here. I think you spoke to an estimation of about 8% of the flow being bought back in 2025 under the context of the current share price and free cash flow yield that you have there. But I'm just wondering if maybe you could give us some view into the -- when you say balanced return of capital between the dividend and buybacks, how do you define the parameters in terms of that balance? What's the rate amount of the dividend versus the share buybacks? Is it based on breakeven, which I think you alluded to being about $50 to fund the CapEx and the dividend? Or is there some sort of other formula that helps you define that kind of divide between the two mechanisms?

Question: Patrick O'Rourke - ATB Capital Markets Inc. - Analyst : Okay? Thank you very much. That's all for.