Jagged Peak Energy, Inc. (NYSE:JAG) Q3 2019 Earnings Conference Call November 8, 2019 11:00 AM ET
James Edwards - Director, IR
James Kleckner - President, CEO & Director
Conference Call Participants
Thank you for standing by, and welcome to the Jagged Peak Energy's third quarter earnings and operational update. [Operator Instructions].
I would now like to hand the conference over to your speaker today, James Edwards, Director of Investor Relations. Thank you. Please go ahead.
Thank you, Jesse. Good morning, everyone, and welcome to Jagged Peak Energy's Third Quarter 2019 Earnings and Operational Update Conference Call. This morning, Jim Kleckner, our President and CEO, will be providing a short set of prepared remarks. As we noted in our press release last evening, we will not be hosting a Q&A session on the call today nor do we have an investor presentation to accompany this call.
A copy of the release and our 10-Q can both be found on our website at www.jaggedpeakenergy.com. During this call, we'll make certain forward-looking statements about the company's financial condition, results of operations, plans, objectives, future performance and business activities. We caution that our actual results could differ materially from these results from the results that are indicated in the forward-looking statements due to a variety of factors. Information about these factors can be found in the company's SEC filings, including the 2018 10-K and 2019 10-Qs.
Our materials also include certain non-GAAP financial measures such as adjusted EBITDAX and adjusted net income. We believe these non-GAAP measures provide a comparison across periods of activity with other oil and gas operators. The reconciliation of these appropriate GAAP financial measures to the non-GAAP financial measures can be found in our earnings release.
I'll now turn the call over to Jim for his review of the quarter.
Thanks, James. Good morning, everyone, and thank you for joining us for our abbreviated third quarter conference call. Overall, our third quarter performance was strong as we continued to successfully execute on our 2019 plan, particularly our ability to drive down CapEx and keep production on track. We brought online 17 wells during the quarter, on the high end of our expectations, while our capital expenditures for the quarter came in below our budgeted amount as we continued to drive improved capital efficiency.
Through the third quarter, DC&E costs averaged $1,160 per lateral foot down from $1,250 in the second quarter, 7% below our 2019 annual goal of $1,250 per lateral foot. These efficiencies were driven by continuous execution improvements and moving to larger pads. For production, we averaged 30,000 barrels of oil per day, right at the midpoint of our third quarter guidance range. We're pleased with the drilling and completion activities on our first 2 larger-scale pads, Coriander and Venom, as they both came online on time and on budget. In these first 2 larger-pad projects, we were able to capture lessons learned that provided immediate benefits on the adjacent and subsequent wells, driving down per lateral foot project costs.
Our Coriander project had a DC&E cost of approximately $1,090 per lateral foot, a lower quarterly average and had a peak IP30 of 102 barrels of oil per thousand lateral foot. The Venom project had an average DC&E cost of approximately $1,220 per lateral foot. These costs were somewhat higher than the Coriander project as the wells had shorter 7,900-foot laterals compared to 8,500-foot laterals on the Coriander project.
The Venom wells were just recently turned online and have yet to establish a peak IP30 rate. While we have limited data set of production results from these 2 projects, the early results look encouraging and we look forward to seeing how they produce over time.
In summary, we're very pleased with the progress we have made so far this year and look forward to additional value that the team at Parsley will achieve from the combined set of assets in the coming years. We believe that pro-forma Parsley, Jagged Peak company provides Jagged Peak shareholders with premier acreage in both Midland and Delaware subbasins while providing additional scale, significant operational synergies, and free cash flow in this competitive environment.
I'd like to thank both current and former members of the Jagged Peak team for all they've done to put together such a great asset over the years, and we would like to thank our investor base for their support for the 2.5 years we've been a public company.
And with that closing remark, I will conclude the call.
This concludes today's conference. You may now disconnect.