THE WOODLANDS, Texas, Aug. 06, 2024 (GLOBE NEWSWIRE) -- Ring Energy, Inc. (NYSE:REI) ("Ring" or the "Company") today reported operational and financial results for second quarter 2024 and provided an improved outlook for the third quarter and full year. Second Quarter 2024 Highlights Produced sales of 13,623 barrels of oil per day ("Bo/d"), representing a 2% increase over the first quarter of 2024; Sold record total volumes of 19,786 barrels of oil equivalent per day ("Boe/d") (69% oil), which was 4% higher than the first quarter; Reported net income of $22.4 million, or $0.11 per diluted share, and Adjusted Net Income1 of $23.4 million, or $0.12 per diluted share; Recorded Lease Operating Expense ("LOE") of $10.72 per Boe, which was below the low end of guidance; Increased Cash Operating Margin1 to $32.97 per Boe, reflecting a 7% increase over the first quarter and contributing to 9% growth year-to-date from 2023; Achieved record Adjusted EBITDA1 of $66.4 million — up 7% from the first quarter and 15% year-to-date; Incurred capital expenditures of $35.4 million, which was below the low end of guidance; Successfully drilled and completed 11 producing wells (guidance was 9 to 11 wells) during the second quarter of which five wells came online late in the period; Generated record Adjusted Free Cash Flow of $21.4 million during the quarter and $37.0 million year-to-date — representing a 60% increase for the first six months. The Company has remained cash flow positive for 19 consecutive quarters; Ended the period with $407.0 million in outstanding borrowings on the Company's credit facility, reflecting a paydown of $15.0 million during the quarter and $48.0 million since closing the Founders Acquisition in August 2023; Increased liquidity to $194.1 million and lowered the Leverage Ratio2 to 1.59x as of June 30, 2024; and Provided guidance for higher sales volumes, lower operating expenses and lower capital spending for the third quarter and full year. Mr. Paul D. McKinney, Chairman of the Board and Chief Executive Officer, commented, "The second quarter marked another successful period for the Company reaching a number of key milestones as part of our proven strategy focused on maximizing cash flow generation. This included record production, Adjusted EBITDA and Adjusted Free Cash Flow that led to a $15 million reduction of debt. Driving the 60% increase in year-to-date Adjusted Free Cash Flow over 2023 was the impact of the Founders Acquisition that closed in August 2023 and the outstanding performance of our ongoing capital spending program. In addition, our year-to-date results reflect the benefits from our continued focus on reducing overall costs and downtime. We believe these factors place us in a good position for ongoing success. We look forward to additional material debt reduction over the coming quarters, subject to oil prices remaining at recent levels." Mr. McKinney concluded, "For second half 2024, we remain focused on maximizing cash flow to further improve our balance sheet. The success of our disciplined capital spending program in the first half bodes well for the remainder of 2024, and we will continue to execute our plan to organically maintain or slightly grow oil production. Our updated full year guidance reflects a 4% increase in daily oil production and a 3% decrease in capital spending — both assuming the midpoint. While our focus remains on reducing debt, we continue to evaluate growth opportunities through strategic, accretive and balance sheet enhancing acquisitions." _______________1 A non-GAAP financial measure; see the "Non-GAAP Information" section in this release for more information including reconciliations to the most comparable GAAP measures.2 Refer to the "Non-GAAP Information" section in this release for calculation of the Leverage Ratio. Summary Results   Quarter to Date Year to Date   Q2 2024 Q1 2024 Q2 2024 to Q1 2024% Change Q2 2023 Q2 2024 to Q2 2023% Change YTD 2024 YTD 2023 YTD % Change Average Daily Sales Volumes (Boe/d)   19,786   19,034 4 %   17,271 15 %   19,410   17,779 9 % Crude Oil (Bo/d)   13,623   13,394 2 %   11,861 15 %   13,509   12,259 10 % Net Sales (MBoe)   1,800.6   1,732.1 4 %   1,571.7 15 %   3,532.6   3,218.0 10 % Realized Price - All Products ($/Boe) $ 55.06 $ 54.56 1 % $ 50.49 9 % $ 54.82 $ 52.03 5 % Realized Price - Crude Oil ($/Bo) $ 80.09 $ 75.72 6 % $ 72.30 11 % $ 77.93 $ 72.85 7 % Revenues ($MM) $ 99.1 $ 94.5 5 % $ 79.3 25 % $ 193.6 $ 167.4 16 % Net Income ($MM) $ 22.4 $ 5.5 306 % $ 28.8 (22 )% $ 27.9 $ 61.5 (55 )% Adjusted Net Income ($MM) $ 23.4 $ 20.3 15 % $ 28.0 (16 )% $ 43.8 $ 53.0 (17 )% Adjusted EBITDA ($MM) $ 66.4 $ 62.0 7 % $ 53.5 24 % $ 128.4 $ 112.0 15 % Capital Expenditures ($MM) $ 35.4 $ 36.3 (2 )% $ 31.6 12 % $ 71.6 $ 70.5 2 % Adjusted Free Cash Flow ($MM) $ 21.4 $ 15.6 38 % $ 12.6 70 % $ 37.0 $ 23.1 60 %                                   Financial Overview: For the second quarter of 2024, the Company reported net income of $22.4 million, or $0.11 per diluted share, which included a $0.8 million before-tax non-cash unrealized commodity derivative gain and $2.1 million in before-tax share-based compensation. The Company's Adjusted Net Income was $23.4 million, or $0.12 per diluted share. In the first quarter of 2024, the Company reported net income of $5.5 million, or $0.03 per diluted share, which included a $17.6 million before-tax non-cash unrealized commodity derivative loss and $1.7 million for before-tax share-based compensation costs. The Company's Adjusted Net Income for the first quarter of 2024 was $20.3 million, or $0.10 per diluted share. For the second quarter of 2023, Ring reported net income of $28.8 million, or $0.15 per diluted share, which included a $3.1 million before-tax non-cash unrealized commodity derivative gain, $2.3 million in before-tax share-based compensation and $0.2 million in before-tax transaction costs. Adjusted Net Income in the second quarter of 2023 was $28.0 million, or $0.14 per diluted share. Adjusted EBITDA was a record $66.4 million for the second quarter of 2024 compared to $62.0 million for the first quarter of 2024 and $53.5 million for the second quarter of 2023 — a 7% and 24% increase, respectively. Adjusted Free Cash Flow for the second quarter of 2024 was a record $21.4 million versus $15.6 million for the first quarter of 2024 (38% increase) and $12.6 million for the second quarter of 2023 (70% increase). Included was capital spending of $35.4 million in the second quarter of 2024 versus $36.3 million in the first quarter of 2024 and $31.6 million in the second quarter of 2023. Adjusted Cash Flow from Operations was a record $56.6 million for the second quarter of 2024 compared to $51.9 million for the first quarter of 2024 (a 9% increase), and $44.0 million for the second quarter of 2023 (a 29% increase). Adjusted Net Income, Adjusted EBITDA, Adjusted Free Cash Flow, Adjusted Cash Flow from Operations, and Cash Operating Margin are non-GAAP financial measures, which are described in more detail and reconciled to the most comparable GAAP measures, in the tables shown later in this release under "Non-GAAP Financial Information." Sales Volumes, Prices and Revenues: Sales volumes for the second quarter of 2024 were 19,786 Boe/d (69% oil, 14% natural gas and 17% NGLs), or 1,800,570 Boe. Positively impacting second quarter 2024 sales volumes was the Founders Acquisition that closed in August 2023 and incremental production brought online during the period associated with the Company's ongoing development program. First quarter 2024 sales volumes were 19,034 Boe/d (70% oil, 15% natural gas and 15% NGLs), or 1,732,057 Boe, and second quarter of 2023 sales volumes were 17,271 Boe/d (69% oil, 16% natural gas and 15% NGLs), or 1,571,668 Boe. Second quarter 2024 sales volumes were comprised of 1,239,731 barrels ("Bbls") of oil, 1,538,347 thousand cubic feet ("Mcf") of natural gas and 304,448 Bbls of NGLs. For the second quarter of 2024, the Company realized an average sales price of $80.09 per barrel of crude oil, $(1.93) per Mcf of natural gas, and $9.27 per barrel of NGLs. The realized natural gas and NGL prices were impacted by a fee reduction to the value received. For the second quarter of 2024, the weighted average natural gas price per Mcf was $(0.34) and the weighted average fee value per Mcf was $(1.59); the weighted average NGL price per barrel was $19.49 offset by a weighted average fee per barrel of $(10.22). The weighted average natural gas price for second quarter 2024 reflects continued natural gas product takeaway constraints, which could be alleviated through additional third-party pipeline capacity targeted to come online by year end 2024. The combined average realized sales price for the period was $55.06 per Boe, up 1% versus $54.56 per Boe for the first quarter of 2024, and up 9% from $50.49 per Boe in the second quarter of 2023. The average oil price differential the Company experienced from NYMEX WTI futures pricing in the second quarter of 2024 was a negative $0.61 per barrel of crude oil, while the average natural gas price differential from NYMEX futures pricing was a negative $4.31 per Mcf. Revenues were $99.1 million for the second quarter of 2024 compared to $94.5 million for the first quarter of 2024 and $79.3 million for the second quarter of 2023. The 5% increase in second quarter 2024 revenues from the first quarter of 2024 was driven by higher overall realized pricing and sales volumes. Lease Operating Expense ("LOE"): LOE, which includes expensed workovers and facilities maintenance, was $19.3 million, or $10.72 per Boe, in the second quarter of 2024, which was below the low end of the Company's guidance of $10.75 to $11.25 per Boe. LOE per Boe was below expectations due to lower expense workover costs and higher production. LOE was $18.4 million, or $10.60 per Boe in the first quarter of 2024 and $15.9 million, or $10.14 per Boe, for the second quarter of 2023.  Gathering, Transportation and Processing ("GTP") Costs: As previously disclosed, due to a contractual change effective May 1, 2022, the Company no longer maintains ownership and control of natural gas through processing for the majority of gas produced. As a result, the majority of GTP costs are now reflected as a reduction to the natural gas sales price and not as an expense item. There does remain one contract in place with a natural gas processing entity where the point of control of gas dictates requiring the fees to be recorded as an expense. Ad Valorem Taxes: Ad valorem taxes were $0.74 per Boe for the second quarter of 2024 compared to $1.24 per Boe in the first quarter of 2024 and $1.06 per Boe for the second quarter of 2023. Production Taxes: Production taxes were $2.01 per Boe in the second quarter of 2024 compared to $2.56 per Boe in the first quarter of 2024 and $2.55 per Boe in second quarter of 2023. Production taxes ranged between 3.7% to 5.1% of revenue for all three periods. Depreciation, Depletion and Amortization ("DD&A") and Asset Retirement Obligation Accretion:  DD&A was $13.72 per Boe in the second quarter of 2024 versus $13.74 per Boe for the first quarter of 2024 and $13.23 per Boe in the second quarter of 2023. Asset retirement obligation accretion was $0.20 per Boe in the second quarter of 2024 and for the first quarter of 2024, compared to $0.23 per Boe in the second quarter of 2023. General and Administrative Expenses ("G&A"):  G&A was $7.7 million ($4.28 per Boe) for the second quarter of 2024 versus $7.5 million ($4.31 per Boe) for the first quarter of 2024 and $6.8 million ($4.33 per Boe) for the second quarter of 2023. G&A, excluding non-cash share-based compensation, was $5.6 million ($3.13 per Boe) for the second quarter of 2024 versus $5.7 million ($3.32 per Boe) for the first quarter of 2024 and $4.5 million ($2.89 per Boe) for the second quarter of 2023. G&A, excluding non-cash share-based compensation and transaction costs, was $5.6 million ($3.13 per Boe) for the second quarter of 2024 versus $5.7 million ($3.32 per Boe) for the first quarter of 2024 and $4.3 million ($2.75 per Boe) for the second quarter of 2023. Interest Expense: Interest expense was $10.9 million in the second quarter of 2024 versus $11.5 million for the first quarter of 2024 and $10.6 million for the second quarter of 2023.  Derivative (Loss) Gain:  In the second quarter of 2024, Ring recorded a net loss of $1.8 million on its commodity derivative contracts, including a realized $2.6 million cash commodity derivative loss and an unrealized $0.8 million non-cash commodity derivative gain. This compares to a net loss of $19.0 million in the first quarter of 2024, including a realized $1.5 million cash commodity derivative loss and an unrealized $17.6 million non-cash commodity derivative loss. In the second quarter of 2023, the Company recorded a net gain on commodity derivative contracts of $3.3 million, including a realized $0.2 million cash commodity derivative gain and an unrealized $3.1 million non-cash commodity derivative gain.  A summary listing of the Company's outstanding derivative positions at June 30, 2024 is included in the tables shown later in this release. For the remainder (July through December) of 2024, the Company has approximately 1.2 million barrels of oil (approximately 49% of oil sales guidance midpoint) hedged and approximately 1.2 billion cubic feet of natural gas (approximately 38% of natural gas sales guidance midpoint) hedged. Income Tax: The Company recorded a non-cash income tax provision of $6.8 million in the second quarter of 2024 versus $1.7 million in the first quarter of 2024, and a non-cash benefit of $6.4 million for the second quarter of 2023. Balance Sheet and Liquidity: Total liquidity (defined as cash and cash equivalents plus borrowing base availability under the Company's credit facility) at June 30, 2024 was $194.1 million, an 8% increase from March 31, 2024. Liquidity at June 30, 2024 consisted of cash and cash equivalents of $1.2 million and $192.9 million of availability under Ring's revolving credit facility, which included a reduction of $35 thousand for letters of credit. On June 30, 2024, the Company had $407 million in borrowings outstanding on its credit facility that has a current borrowing base of $600 million. During the second quarter, Ring paid down $15 million in borrowings. Consistent with the past, the Company is targeting additional debt reduction in 2024, dependent on market conditions, the timing and level of capital spending, and other considerations. Capital Expenditures: During the second quarter of 2024, capital expenditures were $35.4 million, which was below the Company's guidance of $37 million to $42 million, while the number of producing wells drilled and completed — 11 in total — was at the high end of the Company's guidance range. All 11 wells are in the Central Basin Platform and have a working interest of 100%. Specifically, in its Andrews County acreage the Company drilled and completed five 1-mile horizontal ("Hz") wells, in the Ector County acreage Ring drilled and completed three vertical wells, and in the Crane County acreage the Company drilled and completed three vertical wells. Contributing to lower than expected actual capital spending levels for the first half of 2024 was increased well completion efficiencies, improved logistics for certain drilling activities, and lower costs due to an improved macro environment for drilling and completion services for Ring's wells. The impact of these factors is reflected in the Company's updated full year 2024 guidance, including Ring's outlook for the second half of 2024. Quarter   Area   Wells Drilled   Wells Completed               1Q 2024   Northwest Shelf (Horizontal)   2   2     Central Basin Platform (Horizontal)   3   3     Central Basin Platform (Vertical)   6   6     Total (1)   11   11               2Q 2024   Northwest Shelf (Horizontal)   —   —     Central Basin Platform (Horizontal)   5   5     Central Basin Platform (Vertical)   6   6     Total   11   11 (1) First quarter total does not include the SWD well drilled and completed in the Central Basin Platform. Full Year and Third Quarter 2024 Sales Volumes, Capital Investment and Operating Expense Guidance The Company commenced its 2024 development program with two rigs (one Hz and one vertical) focused on slightly growing oil sales volumes and maintaining year-over-year Boe sales. Ring's year-to-date performance has led to greater year-over-year Boe and oil sales volumes growth than originally planned. For full year 2024, Ring now expects total capital spending of $141 million to $161 million (versus $135 million to $175 million previously), a 3% reduction at the midpoint. The updated program includes a balanced and capital efficient combination of drilling, completing and placing on production 19 to 23 Hz and 22 to 25 vertical wells across the Company's asset portfolio. Additionally, the full year capital spending program includes funds for targeted well recompletions, capital workovers, infrastructure upgrades, reactivations, and leasing costs, as well as non-operated drilling, completion, and capital workovers. All projects and estimates are based on assumed WTI oil prices of $70 to $90 per barrel and Henry Hub prices of $2.00 to $3.00 per Mcf. As in the past, Ring has designed its spending program with flexibility to respond to changes in commodity prices and other market conditions as appropriate. Based on the $151 million midpoint of spending guidance, the Company continues to expect the following estimated allocation of capital, including: 75% for drilling, completion, and related infrastructure; 17% for recompletions and capital workovers; 5% for ESG improvements (environmental and emission reducing upgrades); and 3% for land, non-operated capital, and other.   The Company is increasing its full year 2024 oil sales volumes guidance to between 13,200 and 13,800 Bo/d versus 12,600 to 13,300 Bo/d previously, which reflects a 4% increase at the midpoint. The Company remains focused on maximizing Adjusted Free Cash Flow. All 2024 planned capital expenditures will be fully funded by cash on hand and cash from operations, and excess Adjusted Free Cash Flow is targeted for further debt reduction.    For the third quarter of 2024, Ring is providing guidance for increased sales volumes, and lower capital spending and operating expense. Ring expects third quarter 2024 sales volumes of 13,200 to 13,800 Bo/d and 19,000 to 19,800 Boe/d (70% oil, 14% natural gas, and 16% NGLs).  The Company is targeting total capital expenditures in third quarter 2024 of $35 million to $45 million, primarily for drilling and completion activity. Additionally, the capital spending program includes funds for targeted capital workovers, infrastructure upgrades, well reactivations, leasing acreage; and non-operated drilling, completion, and capital workovers. Ring now expects LOE of $10.50 to $11.25 per Boe for both the third quarter and full year. The Company's previous guidance for full year 2024 was $10.50 to $11.50 per Boe. The guidance in the table below represents the Company's current good faith estimate of the range of likely future results. Guidance could be affected by the factors discussed below in the "Safe Harbor Statement" section.   Q3 FY   2024 2024 Sales Volumes:     Total Oil (Bo/d) 13,200 - 13,800 13,200 - 13,800 Mid Point (Bo/d) 13,500 13,500 Total (Boe/d) 19,000 - 19,800 19,000 - 19,800 Mid Point (Boe/d) 19,400 19,400 Oil (%) 70% 70% NGLs (%) 16% 16% Gas (%) 14% 14%       Capital Program:     Capital spending(1) (millions) $35 - $45 $141 - $161 Mid Point (millions) $40 $151 New Hz wells drilled 7 - 8 19 - 23 New Vertical wells drilled 6 - 7 22 - 25 Wells completed and online 11 - 12 41 - 48       Operating Expenses:     LOE (per Boe) $10.50 - $11.25 $10.50 - $11.25 Mid Point (per Boe) $10.88 $10.88 (1) In addition to Company-directed drilling and completion activities, the capital spending outlook includes funds for targeted well recompletions, capital workovers, infrastructure upgrades, and well reactivations. Also included is anticipated spending for leasing acreage; and non-operated drilling, completion, and capital workovers. Conference Call Information Ring will hold a conference call on Wednesday, August 7, 2024 at 12:00 p.m. ET (11 a.m. CT) to discuss its second quarter 2024 operational and financial results. An updated investor presentation will be posted to the Company's website prior to the conference call. To participate in the conference call, interested parties should dial 833-953-2433 at least five minutes before the call is to begin. Please reference the "Ring Energy Second Quarter 2024 Earnings Conference Call". International callers may participate by dialing 412-317-5762. The call will also be webcast and available on Ring's website at www.ringenergy.com under "Investors" on the "News & Events" page. An audio replay will also be available on the Company's website following the call. About Ring Energy, Inc. Ring Energy, Inc. is an oil and gas exploration, development, and production company with current operations focused on the development of its Permian Basin assets. For additional information, please visit www.ringenergy.com. Safe Harbor Statement This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements involve a wide variety of risks and uncertainties, and include, without limitation, statements with respect to the Company's strategy and prospects. The forward-looking statements include statements about the expected future reserves, production, financial position, business strategy, revenues, earnings, costs, capital expenditures and debt levels of the Company, and plans and objectives of management for future operations. Forward-looking statements are based on current expectations and assumptions and analyses made by Ring and its management in light of their experience and perception of historical trends, current conditions and expected future developments, as well as other factors appropriate under the circumstances. However, whether actual results and developments will conform to expectations is subject to a number of material risks and uncertainties, including but not limited to: declines in oil, natural gas liquids or natural gas prices; the level of success in exploration, development and production activities; adverse weather conditions that may negatively impact development or production activities particularly in the winter; the timing of exploration and development expenditures; inaccuracies of reserve estimates or assumptions underlying them; revisions to reserve estimates as a result of changes in commodity prices; impacts to financial statements as a result of impairment write-downs; risks related to level of indebtedness and periodic redeterminations of the borrowing base and interest rates under the Company's credit facility; Ring's ability to generate sufficient cash flows from operations to meet the internally funded portion of its capital expenditures budget; the impacts of hedging on results of operations; and Ring's ability to replace oil and natural gas reserves. Such statements are subject to certain risks and uncertainties which are disclosed in the Company's reports filed with the Securities and Exchange Commission, including its Form 10-K for the fiscal year ended December 31, 2023, and its other filings. Ring undertakes no obligation to revise or update publicly any forward-looking statements, except as required by law. Contact Information Al Petrie AdvisorsAl Petrie, Senior PartnerPhone: 281-975-2146  Email: RING ENERGY, INC.Condensed Statements of Operations(Unaudited)     Three Months Ended   Six Months Ended   June 30,   March 31,   June 30,   June 30,   June 30,     2024       2024       2023       2024       2023                       Oil, Natural Gas, and Natural Gas Liquids Revenues $ 99,139,349     $ 94,503,136     $ 79,348,573     $ 193,642,485     $ 167,431,485                       Costs and Operating Expenses                   Lease operating expenses   19,309,017       18,360,434       15,938,106       37,669,451       33,410,797   Gathering, transportation and processing costs   107,629       166,054       (1,632 )     273,683       (2,455 ) Ad valorem taxes   1,337,276       2,145,631       1,670,343       3,482,907       3,340,956   Oil and natural gas production taxes   3,627,264       4,428,303       4,012,139       8,055,567       8,420,279   Depreciation, depletion and amortization   24,699,421       23,792,450       20,792,932       48,491,871       42,064,603   Asset retirement obligation accretion   352,184       350,834       353,878       703,018       719,725   Operating lease expense   175,090       175,091       115,353       350,181       228,491   General and administrative expense   7,713,534       7,469,222       6,810,243       15,182,756       13,940,382                       Total Costs and Operating Expenses   57,321,415       56,888,019       49,691,362       114,209,434       102,122,778                       Income from Operations   41,817,934       37,615,117       29,657,211       79,433,051       65,308,707                       Other Income (Expense)                   Interest income   144,933       78,544       79,745       223,477       79,745   Interest (expense)   (10,946,127 )     (11,498,944 )     (10,550,807 )     (22,445,071 )     (20,941,086 ) Gain (loss) on derivative contracts   (1,828,599 )     (19,014,495 )     3,264,660       (20,843,094 )     12,739,565   Gain (loss) on disposal of assets   51,338       38,355       (132,109 )     89,693       (132,109 ) Other income   —       25,686       116,610       25,686       126,210   Net Other Income (Expense)   (12,578,455 )     (30,370,854 )     (7,221,901 )     (42,949,309 )     (8,127,675 )                     Income Before Benefit from (Provision for) Income Taxes   29,239,479       7,244,263       22,435,310       36,483,742       57,181,032                       Benefit from (Provision for) Income Taxes   (6,820,485 )     (1,728,886 )     6,356,295       (8,549,371 )     4,326,352                       Net Income $ 22,418,994     $ 5,515,377     $ 28,791,605     $ 27,934,371     $ 61,507,384                       Basic Earnings per Share $ 0.11     $ 0.03     $ 0.15     $ 0.14     $ 0.33   Diluted Earnings per Share $ 0.11     $ 0.03     $ 0.15     $ 0.14     $ 0.32                       Basic Weighted-Average Shares Outstanding   197,976,721       197,389,782       193,077,859       197,684,638       185,545,775   Diluted Weighted-Average Shares Outstanding   200,428,813       199,305,150       195,866,533       199,845,512       193,023,966                                           RING ENERGY, INC.Condensed Operating Data(Unaudited)     Three Months Ended   Six Months Ended   June 30,   March 31,   June 30,   June 30,   June 30,     2024       2024       2023       2024       2023                       Net sales volumes:                   Oil (Bbls)   1,239,731       1,218,837       1,079,379       2,458,568       2,218,792   Natural gas (Mcf)   1,538,347       1,496,507       1,557,545       3,034,854       3,158,952   Natural gas liquids (Bbls)   304,448       263,802       232,698       568,250       472,690   Total oil, natural gas and natural gas liquids (Boe)(1)   1,800,570       1,732,057       1,571,668       3,532,627       3,217,974                       % Oil   69 %     70 %     69 %     70 %     69 % % Natural Gas   14 %     15 %     16 %     14 %     16 % % Natural Gas Liquids   17 %     15 %     15 %     16 %     15 %                     Average daily sales volumes:                   Oil (Bbls/d)   13,623       13,394       11,861       13,509       12,259   Natural gas (Mcf/d)   16,905       16,445       17,116       16,675       17,453   Natural gas liquids (Bbls/d)   3,346       2,899       2,557       3,122       2,612   Average daily equivalent sales (Boe/d)   19,786       19,034       17,271       19,410       17,779                       Average realized sales prices:                   Oil ($/Bbl) $ 80.09     $ 75.72     $ 72.30     $ 77.93     $ 72.85   Natural gas ($/Mcf)   (1.93 )     (0.55 )     (0.71 )     (1.25 )     (0.01 ) Natural gas liquids ($/Bbls)   9.27       11.47       10.35       10.29       12.35   Barrel of oil equivalent ($/Boe) $ 55.06     $ 54.56     $ 50.49     $ 54.82     $ 52.03                       Average costs and expenses per Boe ($/Boe):                   Lease operating expenses $ 10.72     $ 10.60     $ 10.14     $ 10.66     $ 10.38   Gathering, transportation and processing costs   0.06       0.10       —       0.08       —   Ad valorem taxes   0.74       1.24       1.06       0.99       1.04   Oil and natural gas production taxes   2.01       2.56       2.55       2.28       2.62   Depreciation, depletion and amortization   13.72       13.74       13.23       13.73       13.07   Asset retirement obligation accretion   0.20       0.20       0.23       0.20       0.22   Operating lease expense   0.10       0.10       0.07       0.10       0.07   General and administrative expense (including share-based compensation)   4.28       4.31       4.33       4.30       4.33   G&A (excluding share-based compensation)   3.13       3.32       2.89       3.22       3.03   G&A (excluding share-based compensation and transaction costs)   3.13       3.32