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Natural Resources and Commodities

Video Transcript

TOM BUTCHER: Ward, thanks so much indeed for joining me today. This year we have heard a lot about changes in business plans. How has Camino Resources evolved to face today’s environment, and especially the increasing emphasis on return on capital?


WARD POLZIN: Thank you. Appreciate the opportunity to speak and think about that. Our perspective comes from being a large private company. We are not public, so that impacts, I think, my comment. As does the fact that we are also not a small private company. We are the largest private company in the SCOOP-STACK-Merge of central Oklahoma. We are running three rigs, we have these economies of scale, and that in and of itself has changed, to answer your question.


I think we need to be bigger to get a better return on capital. And what I mean by that is some things that we are even doing as a private company now, we never would have done even two years ago it has changed so much. For instance, we are self-sourcing our own sand and chemicals for our fracks. We are committing to longer-term contracts to frack companies and rig companies. All of which gets us better pricing. And being large allows us to have the confidence to make those longer commitments. But the net result is better pricing, and therefore better return on capital for our investors.


So in the past, in the really not-too-distant past, when we sold our previous company, Centennial, just two years ago, we are already far bigger and expecting to own and develop this asset for much longer than we had probably planned in the previous company. All of that is part of this changing, kind of getting capital back to our investors, knowing you are going to be there longer.


I think as a private company in the past you might have just gone for growth, growth, growth. I am going to sell this in a hurry. We are not going to sell it in a hurry. We definitely need to deliver performance, whether our future is to sell to a larger company or to IPO ourselves, we need a longer, better track record of creating value, not just putting some things together.


BUTCHER: Thank you so much. And one last question: what would you like conference attendees to take away with them about Camino Resources?


POLZIN: Well, I think that we are trying to be kind of best in class for the private company perspective. And I think in a bigger picture, too, I would hope people would take away that our shale development on the onshore U.S., we are maturing – we are not mature – but in the last couple of years, we have matured quite a bit. I do not know if that is the third inning of a nine-inning game, or the fourth. Who knows? But it is not the first inning or second inning anymore. And with this maturity, I believe, that leads our industry to focus more on the plays we know work, such as the Permian, such as Oklahoma, such as the DJ and the Eagleford. I think that changes the macro a little bit. That we are now much more focused on improving performance and optimizing, getting a better return, than we are of trying to find that next new play. Certainly, we are trying to find more zones in the current areas we are in, and extend the geographic scope of those, but it is certainly now more about the optimization and execution than it is finding a new Permian or a new Marcellus.


BUTCHER: Ward, thank you very much indeed, and all the best going forward.


POLZIN: Thank you very much. Excited for everything.


IMPORTANT DISCLOSURES


This is not an offer to buy or sell, or a solicitation of any offer to buy or sell any of the securities mentioned herein. The information presented does not involve the rendering of personalized investment, financial, legal, or tax advice. Certain statements contained herein may constitute projections, forecasts and other forward looking statements, which do not reflect actual results. Information provided by third-party sources are believed to be reliable and have not been independently verified for accuracy or completeness and cannot be guaranteed. Any opinions, projections, forecasts, and forward-looking statements presented herein are valid as of the date of this communication and are subject to change without notice.


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