Chord Energy Q2 2026 Earnings Call Transcript

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Provided by Quartr
August 6, 2026

Key Takeaways

  • Positive Sentiment: Adjusted free cash flow reached $414 million, above expectations, with $220 million returned to shareholders through dividends and share repurchases. With normalized leverage below 0.5x, Chord expects to return at least 75% of adjusted free cash flow in the third and fourth quarters.
  • Positive Sentiment: Chord maintained its 2026 oil production outlook at 161,000 barrels per day, 2,000 barrels per day above its initial forecast, while capital guidance remained essentially unchanged. Faster completion cycle times and the removal of a frac crew are expected to reduce spending in the second half.
  • Positive Sentiment: Production optimization efforts—including chemical treatments, ESP and artificial-lift improvements, AI-based pump optimization, workovers, and surface debottlenecking—are showing encouraging early results and have contributed to higher-than-originally expected volumes.
  • Positive Sentiment: The four-mile well program remains on track, with 26 wells turned to sales and early performance in line with expectations. Chord is also evaluating trimulfrac technology for approximately 20% to 50% of its 2027 program, which could lower completion costs and improve efficiency.
  • Negative Sentiment: Full-year LOE guidance increased to $10.30 per BOE due to expanded production-enhancement initiatives, higher workover costs, and elevated non-operated expenses. Management also expects Bakken oil differentials, which benefited from premiums in the second quarter, to weaken toward slightly below WTI over the remainder of the year.
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Earnings Conference Call
Chord Energy Q2 2026
00:00 / 00:00

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Operator

Good morning, ladies and gentlemen, welcome to the Chord Energy Second Quarter 2026 Earnings Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Thursday, August 6, 2026. I would now like to turn the conference over to Bob Bakanauskas, Vice President, Finance. Please go ahead.

Bob Bakanauskas
Bob Bakanauskas
VP of Finance at Chord Energy

Thanks, Julie, good morning, everyone. This is Bob Bakanauskas, today we are reporting second quarter 2026 financial and operational results. We are delighted to have you on the call. I'm joined today by Danny Brown, our CEO, Michael Lou, our Chief Strategy Officer and Chief Commercial Officer, Darrin Henke, our COO Richard Robuck, our CFO, as well as other members of the team. Please be advised that our remarks, including the answers to your question, include statements that we believe to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements are subject to risks and uncertainties that could cause actual results to be materially different from those currently disclosed in our earnings releases and on our conference calls.

Bob Bakanauskas
Bob Bakanauskas
VP of Finance at Chord Energy

Those risks include, among others, matters that we have described in our earnings releases as well as in our filings with the Securities and Exchange Commission, including our annual report on Form 10-K and our quarterly reports on Form 10-Q. We disclaim any obligation to update these forward-looking statements. During this conference call, we will make reference to non-GAAP measures, reconciliations to the applicable GAAP measures can be found in our earnings releases and on our website. We may also reference our current investor presentation, which you can find on our website. With that, I'll turn the call over to our CEO, Danny Brown.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Thanks, Bob. Good morning, everyone, thanks for joining our call. Last night, we released our second quarter results along with an updated investor presentation. In those documents, you'll see Chord delivered another quarter of strong operational and financial performance, which resulted in free cash flow above expectations. Execution remained solid across the organization. Oil production came in at the high end of guidance, while adjusted capital spending finished modestly below the midpoint of guidance. Additionally, we continued making progress on a number of strategic initiatives that we believe will further improve the quality of our business and enhance long-term free cash flow generation. Adjusted free cash flow for the second quarter was $414 million, exceeding expectations, we returned 54% of this, or $220 million, to shareholders through a combination of our base dividend and share repurchases.

Danny Brown
Danny Brown
President and CEO at Chord Energy

With Chord's balance sheet growing to $612 million and normalized leverage declining below 1.5x At quarter end, targeted return of capital is expected to increase to at least 75% of adjusted free cash flow beginning in the third quarter. Stepping back and looking at the macro for a moment, we've obviously seen unusually high volatility this year, and the outlook for commodity prices, particularly oil, remains uncertain. Against this backdrop, Chord will remain focused on disciplined capital allocation and driving continuous improvement through the business. While we expect to see further volatility in the macro, we have diligently built a company that can consistently generate attractive returns across a wide range of price environments. Chord has operated a maintenance plus program for over five years.

Danny Brown
Danny Brown
President and CEO at Chord Energy

This approach has created a large, resilient production base with low declines, supported by an efficient drilling and completions program that delivers volumes at an attractive supply cost. This approach has supported sustainable free cash flow generation and robust shareholder returns. We continue to believe this is the right approach today, even as we leaned into the plus last quarter by raising our full-year guide by 2,000 bpd through our investment in an array of low-cost, short-cycle base production opportunities. Diving deeper into Chord's continuous improvement initiatives, we continue to make progress across a wide variety of areas, including driving longer laterals, improving cycle times, optimizing the production base, implementing AI, and optimizing marketing contracts. As I mentioned in May, Chord is pursuing various projects to optimize its large PDP base.

Danny Brown
Danny Brown
President and CEO at Chord Energy

These activities include accelerating workovers, reducing cycle times for down wells, various chemical jobs, de-bottlenecking surface constraints, optimizing artificial lift through AI, and a host of other projects. Success year-to-date has driven Chord's full-year volume above original expectations, as I just noted. Since May, the team has broadened the scope of its chemical workover program to test multiple new opportunities. That is, we are testing additional chemical treatments over a larger population of wells. We are currently assuming only limited volume upside from these initiatives as we evaluate their effectiveness, economic returns, and implications for the program going forward. While these initiatives have created some near-term upward pressure on LOE, we believe expanding the program is the right step to maximize the long-term potential of the business. On the drilling and completion side, Chord continues to operate well and set new records.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Transitioning the portfolio to longer laterals has been highly impactful for Chord, driving a structurally lower cost of supply and higher returns on invested capital. Since the May update, Chord has turned in line four additional 4-mile pads. As of today, the company has executed 26 4-mile wells in total. Importantly, Chord continues to reach total depth on cleanouts, and execution as well as early performance of the 4-mile program is in line with expectations. Chord remains on track to scale its 4-mile program through the second half of 2026 and into 2027. Looking at cycle times, year-to-date, we've seen some acceleration on the frac side, which has essentially de-risked the 2026 development program by pushing volumes to the front end of the year.

Danny Brown
Danny Brown
President and CEO at Chord Energy

The team also successfully executed the basin's first trimulfrac, which we believe could further drive efficiencies in select areas by reducing completion costs while maintaining high execution quality. Additionally, Chord is benefiting from reduced facilities-related capital through equipment reuse and scalable facility design. You can see Chord continues to make progress driving efficiencies across the business. This has resulted in higher levels of sustainable free cash flow, which in combination with our share repurchase program, has driven strong growth in free cash flow per share. Slide seven in our investor presentation highlights that free cash flow per share has grown about 30% since 2024 on normalized commodity pricing. When using actual 2026 pricing, the growth is obviously substantially higher. That's impressive performance, but maybe even more impressive when considering we preserved the balance sheet along the way.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Turning to updated guidance, we've made a few fairly minor changes. We continue to expect oil volumes to average 161,000 bpd over the course of 2026, which is 2,000 bpd higher than our initial outlook, largely due to investing in Chord's base production. On the D&C side, due to faster cycle times, we accelerated some activity to earlier in the year, which increased first-half volumes and reduced second half relative to our initial outlook. On the capital side, our outlook is essentially unchanged. Looking at the quarterly cadence, we are expecting a meaningful reduction in spending during the third quarter as we drop our second frac crew, followed by another decline in the fourth quarter. We've also updated our differential and realization outlook to reflect current market conditions.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Unique market circumstances drove Bakken crude to trade at premiums to WTI during the second quarter. Currently, we're expecting net premium to fade over the course of the year. On the natural gas and NGL side, we also updated differential guidance to reflect current market conditions. Full-year LOE expense was raised to $10.30 per BOE, reflecting the additional production enhancement initiatives discussed earlier. Additionally, we have also seen some higher workover costs relative to initial expectations, as well as a bit higher non-operated LOE. Expanding on these additional production enhancement opportunities, I'd like to emphasize that Chord is very focused in maximizing economic returns. If investing a small amount of incremental LOE in short cycle opportunities today has a high probability of generating strong risk-adjusted cash flow in the future, that's exactly the type of investment we want to make.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Finally, turning to our updated hedge position, you can see Chord has added some incremental hedged volumes over the next couple of years. Currently, we have approximately 38% of our second-half 2026 oil volumes hedged and about 18% of 2027. In closing, Chord remains committed to delivering affordable and reliable energy in a sustainable and responsible manner. We remain focused on the factors we can control and driving improvements across the business. With that, Julie, we'd be happy to open the line for questions.

Operator

Thank you. Ladies and gentlemen, if you'd like to ask a question, please press star one on your telephone keypad. If you'd like to withdraw your question, press star two. One moment, please, for your first question. Your first question comes from Bert Donnes from William Blair. Please go ahead.

Bert Donnes
Bert Donnes
Analyst at William Blair

Hey, good morning, team. The first question would just be on capital allocation. I think you pointed out that you're gonna step up that free cash flow payout in the remainder of the year. I just want to make sure I understood that wording. It specifically said 3Q. Should we expect that for 3Q and 4Q going forward? Or just, you know, what is the strategy going forward on those levels?

Danny Brown
Danny Brown
President and CEO at Chord Energy

Bert, thanks for the question. Yeah, I would expect to see that in 3Q and 4Q as we move forward. You know, as we talk about this, we've been pretty transparent about how we think about return of capital to shareholders. As we drop below this 0.5 levered on our normalized pricing basis, we've committed we'll return at least 75% back to shareholders, we've hit that mark. We expect to do that as we move forward.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Now, of course, if something happened, we saw our leverage go up, I don't anticipate that, but, you know, we'd evaluate it then, but I would fully anticipate we'll be at above 75%, at least, you know, at a floor of 75% for the balance of the year.

Bert Donnes
Bert Donnes
Analyst at William Blair

That makes sense. Remaining flexible, but expecting over that 75%. Maybe on the oil differentials that you mentioned in your opening remarks, you're starting to guide almost in parity with WTI. That's better than we've seen in prior periods. Oil's, you know, a little bit higher than a year ago. I was trying to understand, is that where you see it long term, or is there upside here? Maybe any thoughts on third-party operator activity or infrastructure capacity? Just where are we in that supply and demand balance?

Michael Lou
Michael Lou
EVP, Chief Strategy Officer, and Chief Commercial Officer at Chord Energy

Yeah, Bert, Michael Lou here. Good question. You know, I think the Bakken overall has traded kind of anywhere from a $-2 to WTI to a $+2. We certainly saw some significant positives in the second quarter. A lot of that has to do with where we are in the basin. There's a lot of takeaway, production's been generally pretty flat, you're in a really good position from broad differentials in the basin. With the huge run-up in oil price in the second quarter, because of the war, we saw a huge backwardation in the curve. You saw some of that CMA roll, kind of roll through to better differentials.

Michael Lou
Michael Lou
EVP, Chief Strategy Officer, and Chief Commercial Officer at Chord Energy

To the extent that you continue to see higher prices in the front and a bit of a backwardated curve, I think you're going to see really tight differentials. We're not thinking that we're going to get that all through the second half. What you're seeing us guide to is something just below WTI, still very strong differentials in the basin. I would say that if you saw periods where you saw the price spike in the front, you should expect differentials to continue to get better for us overall.

Bert Donnes
Bert Donnes
Analyst at William Blair

That's great. Thanks. Good update.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Thanks, Bert.

Operator

Your next question comes from John Abbott from Wolfe Research. Please go ahead.

John Abbott
John Abbott
Analyst at Wolfe Research

Hey, good morning, and thank you for taking our questions. To start off, could you just sort of describe what your typical workover program sort of looks like? What sort of uplift that you sort of see typically from the past ways you've done your workovers? Then could you talk about the early tests that you've seen on the chemicals, and what that made you sort of expand into these other testing, these wider tests that you're doing? When would you have sufficient data to potentially incorporate more of that into your oil outlook?

Danny Brown
Danny Brown
President and CEO at Chord Energy

Great, John. This is Danny. Maybe a few comments here. I would say from a workover perspective, our workovers really cover a whole wide variety of different activities. This could be things from ESPs going down to holes in tubing, to rod repairs that need to be done. It could also involve some of these chemical treatments that we're looking at doing. I think it really just depends on sort of the opportunity we see on an individual well. Oftentimes, we'll have wells go down for various reasons, and so we have a whole fleet of workover rigs that work to bring those wells back online. Sometimes we just think the wells may be producing less than optimal, and we have an opportunity maybe to improve their production. It's not that they're offline, we just think maybe they're sub-optimized from a production delivery perspective.

Danny Brown
Danny Brown
President and CEO at Chord Energy

It really holds a whole different array of opportunities. With respect to the chemical programs, we've tried some chemical programs through the first part of the year. I'd say it's appropriate to say that we've been encouraged with what we've seen, and we're excited about some of the opportunities, and we've got incremental testing we want to do, and we want to expand that testing as we move out and move further. Early results have been encouraging. We don't know. Ultimately, we need to see the production hang in for a little longer before we can start really hanging sort of full expectations to it and start to include that as our full volume expectations moving forward. I'd say early results are encouraging, which is why you're seeing us expand this program as we move forward.

Danny Brown
Danny Brown
President and CEO at Chord Energy

As we get more information, it's going to be, I think, a little bit opportunity-specific. There may be some jobs that it's quite evident that inconsistent, that we see production increases and or failures where it doesn't work, and we'll be able to sort of understand what that looks like pretty quickly. Others, it may take us a little more time if we see more variability in the results. We'll pass that along and incorporate it into our guidance as we're able to get that information and have confidence about it and move forward. I've spoken a lot. I want Darrin to also have an opportunity to give any color commentary from his perspective.

Darrin Henke
Darrin Henke
EVP and COO at Chord Energy

Yeah, probably the only thing I'd add to what Danny said was some of the jobs we're doing, we're lowering the pumps, and we're seeing increased productivity there. As we've shown on slide six, you can see how we've arrested the decline on a pretty good chunk of our wells through these different opportunities. Definitely encouraged with what we've seen, and stay tuned.

John Abbott
John Abbott
Analyst at Wolfe Research

Appreciate it. Your commentary about trimulfrac. You did your first trimulfrac up there, and you've talked about doing that opportunities in select areas. I guess, how does that sort of relate as you sort of think about overall inventory and, given this sort of test, how do you sort of think of trimulfracs sort of feeding into next year? What is the opportunity for you there in terms of you sort of think about your overall inventory going forward?

Darrin Henke
Darrin Henke
EVP and COO at Chord Energy

John, this is Darrin again. We're really starting to investigate optionality around trimulfracs for next year, and it could be 25% to maybe as much as 50% of our program next year. Probably 20%-50%, somewhere in that range. It takes a lot of things to make all that work out. We're also looking at remote fracking, which would allow us to trimulfrac not only on one pad, but multiple pads perhaps at the same time. The team was definitely encouraged with what we saw with the first trimulfrac in the basin. It's amazing how great a job the team did in standing that up and really improving the efficiency of that frac crew. We're excited about it. We're going to look for additional opportunities.

Darrin Henke
Darrin Henke
EVP and COO at Chord Energy

I can't really speak to the inventory, how much of our inventory, looking out over the next 10 years, that we can do with trimulfrac. Next year, it could be, like I say, 20%-50%, perhaps would be the range.

John Abbott
John Abbott
Analyst at Wolfe Research

All right. Thank you for the additional color.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Thanks, John.

Operator

Your next question comes from John Annis from Texas Capital. Please go ahead.

John Annis
John Annis
Analyst at Texas Capital

Hey, good morning, all, and thanks for taking my questions. For my first one, the economics on slide 13 assume 80% contribution from the 4th mile. With 26 TIL and over 50 drilled, how many have 6+ months of production? Is the toe contribution tracking that 80%? Separately, is the gap between the drilled and TIL a function of more lumpy completions with simulfrac or trimulfrac, or is that a normalized spread?

Danny Brown
Danny Brown
President and CEO at Chord Energy

I'd say, let's start with maybe the second part first. It's always going to be a little bit of a lag we've got in how we drill these wells and then getting the completion crews in, making sure all the midstream's in place and the facilities are built, and then bringing them online. You'll see a little bit of lumpiness as we do, depending upon the size of the pads and how the overall development works, but always expect to see a little bit of a lag there. With respect to how many have six months of production or more, I don't know that number off the top of my head. Clearly, we're happy about what we've seen so far. With respect to when we really understand what that 4th-mile contribution looks like, I think we're still a little early from that.

Danny Brown
Danny Brown
President and CEO at Chord Energy

As we model these things out through simulation, the production profiles look reasonably similar during the early period of the well, then they diverge a little bit as you get forward in time. We really need to see as they go through this initial flow period and they start to get into more stabilized flow in the future, you can start to really see the difference on how that 4th mile is contributing. We're still a little too early there to make a call. We like what we're seeing. Everything we're seeing is in line with the expectations, we're excited about the program, but I think we're still just a little bit too early to validate like we did with 3 miles previously, that we're getting full contribution from that last mile. I'm encouraged with what we saw on the 3-mile program.

Danny Brown
Danny Brown
President and CEO at Chord Energy

We're actively monitoring these wells as we move forward. As we have confidence on whether or not we're seeing incremental contribution from that 4th mile, we'll certainly bake it into our plans and pass that along. I still think it's just a little too early right now.

John Annis
John Annis
Analyst at Texas Capital

Makes sense. I appreciate that.

Darrin Henke
Darrin Henke
EVP and COO at Chord Energy

I think the one thing I'd add to that, Danny, is we pump tracers on all of our 4-mile wells, and we're seeing tracers from those toe stages back at the surface. We know those stages are contributing. All indications are certainly positive at this point.

John Annis
John Annis
Analyst at Texas Capital

Super. Thank you. For my follow-up, as you brought in the chemical program across hundreds of wells, how are you identifying the best candidates, and are you seeing meaningful differences in response by area or well vintage?

Danny Brown
Danny Brown
President and CEO at Chord Energy

Again, we're early in the testing phases of this chemical program, and it's not only one type of thing that we're trying. We're trying several different things. The team has a selection criteria where they look to see what wells they think may be the best candidates for these types of jobs, and then that's going to vary a little bit by the specific circumstances of that well. Yeah, we're trying several different types of chemical treatments. We do have a selection process for trying to determine which wells are the best candidates, and we're marching through those. We'll execute them, monitor performance, learn from it, and then move forward.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Again, we're encouraged with early results, but we need a little more, enough so that we want to expand this program, and as we have more information and more data, we'll certainly be passing that along and incorporating into our future expectations.

John Annis
John Annis
Analyst at Texas Capital

Makes sense. Thanks, guys.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Thank you.

Operator

Your next question comes from Paul Diamond from Citi. Please go ahead.

Paul Diamond
Paul Diamond
Analyst at Citi

Good morning. Thanks for taking the call. I'm going to talk a bit about slide six. Yeah, slide six, you guys have listed a pretty robust opportunity set with a whole block full of initiatives. Can you put some, I guess, clarification around that? Which ones are the low-hanging fruit versus which ones we would expect to see more over time? Is there any that stand out one way or the other?

Danny Brown
Danny Brown
President and CEO at Chord Energy

I'd say that, again, as we look at these chemical jobs, and really more broadly, our overall base production initiatives, there is a whole wide array of opportunities. Certainly, one of the largest costs and impacts to production we see is if we can improve the runtime and efficiency of our ESPs. We've got a whole team, and in fact, we've organized around the entire organization around really making sure we've got a team dedicated to improving our ESP runtime and our ESP performance. I think we're seeing some strong returns on that program. We haven't highlighted that here, but I just do want to give the team a shout-out for their efforts on that. That certainly is something that we see a lot of opportunity from a potential cost structure and runtime standpoint.

Danny Brown
Danny Brown
President and CEO at Chord Energy

From a chemical perspective, I would say, again, we are encouraged with what we're seeing through several of these different types of jobs. We've seen some pretty significant improvement in well productivity on a few of them we've done. We need to make sure that we understand the mechanism of why that worked, and to make sure that it's replicable, and that we can do good candidate selection here. Again, we're excited about several of these things, and as we get some more, again, as we get confidence in the repeatability of the results, and we'll know that as we are able to expand this program and see the production response of them, we'll be passing that on. Darrin, anything to add?

Darrin Henke
Darrin Henke
EVP and COO at Chord Energy

No, I think you covered it well, Danny. I don't have any additional.

Paul Diamond
Paul Diamond
Analyst at Citi

Got it. Just for a quick follow-up. I know you guys are dropping the second frac crew on 2H. Do you have any update on the timing of that? Should we expect that on mid-Q3, late Q3? Just trying to think about capital timing in 2H.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Yeah. We dropped that in July. We've already dropped that frac crew, which is why we're confident about seeing 3Q capital come down.

Paul Diamond
Paul Diamond
Analyst at Citi

Got it. Appreciate the clarity. I'll leave it there.

Danny Brown
Danny Brown
President and CEO at Chord Energy

All right. Good stuff.

Operator

Ladies and gentlemen, as a reminder, if you'd like to ask a question, press star one on your telephone keypad. Your next question comes from Geoff Jay from Daniel Energy Partners. Please go ahead.

Geoff Jay
Analyst at Daniel Energy Partners

Hey, guys. I just was hoping to get a little more color maybe on some of the production optimization efforts. Is there an element of that that's more widely deployed that's a bigger contributor than the others? I would assume the chemicals is probably a low contributor, maybe the runtime is a bigger one. I guess what I'm getting at is, I think a lot about the AI deployment. How broadly is that deployed? Is there a lot more room there, or are you doing a lot with the AI optimization of artificial lift?

Danny Brown
Danny Brown
President and CEO at Chord Energy

That's a great question, Geoff, and I'd say that we've really implemented that pretty widely across the field at this point for our wells that are on rod pump. Really, at the end of the day, almost every well that we've got within the field will end up on rod pump. We've got a few that may be on longer-term gas lift, but essentially, we've got nearly every well ends up on rod pump, and we've been able to use the ability of the computer through artificial intelligence to really optimize that entire rod pump program to ensure that not only are we sort of loading that pump properly, but what that results in is to ensure that the wear on the pump is reduced, and that the production is improved. So we've done that pretty broadly across the field.

Danny Brown
Danny Brown
President and CEO at Chord Energy

I suspect that there's room for optimization on that. With respect to implementation, it's pretty broadly implemented. The nice thing about that is we've seen the success there. Now I think you may see us looking at what other opportunities do we have to ensure that the computer can optimize aspects of our operation, that instead of being optimized on a daily or weekly or sort of maybe even less infrequent basis, where they could be optimized almost instantaneously to make sure that we're maximizing production. I think that was a good win for us, and is very broadly adopted across the field, sort of as you pointed out. Now, from a chemical standpoint, again, it's going to depend on the specific issues we see with that well and the opportunity of the chemical that we're injecting.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Those may be a little bit more specific and bespoke depending upon what's going on with the well. There are some initiatives like this rod pump that we've done across the entire sort of rod pump fleet. Additionally, I mentioned earlier we've got a whole fleet of workover rigs that help us continue to make sure that our base production's running effectively and efficiently. We're now using the computer to help us schedule all of those jobs. As you can imagine, in the past, you would have a human look through and determine as a well goes down, and we have wells going down every day, we've got over 5,000 wells in the basin. We would have to optimize where does that workover rig go next.

Danny Brown
Danny Brown
President and CEO at Chord Energy

You were making all of those judgment calls about proximity to the next well, the amount of production that was off, the cost of the job, the availability of parts to do the job, because you never wanted those things to have any idle time. Well, the computer can do all of that scheduling math very effectively and very quickly. We're looking for that sort of scheduling optimization as well, which is not something we may classically talk about as part of our base production enhancement initiatives, but it has a potentially a big effect to make sure that we're very optimized on scheduling all those workover rigs out within the field. Long story short, I think we've got a lot of different initiatives. Some of them will have more broad impact, as you mentioned. Some may be a little more focused.

Danny Brown
Danny Brown
President and CEO at Chord Energy

We think all of them have the opportunity to increase value from our base production, and we're excited about all of them.

Geoff Jay
Analyst at Daniel Energy Partners

That's really helpful. Thank you.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Thanks, Geoff.

Operator

There are no further questions at this time. I will turn the call back over to Danny Brown, CEO, for closing remarks.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Thanks, Julie. Before we wrap up, I'd like to thank all of our employees for another outstanding quarter. Their commitment to safety, operational excellence, and continuous improvement is what allows Chord to consistently deliver strong results while strengthening the business for the long term. As we step back and look at where Chord stands today, I think we're in an excellent position. We have a high-quality, oil-weighted asset base with a long runway of attractive inventory, robust, sustainable free cash flow, and one of the strongest balance sheets in the sector. Those advantages give us confidence that we can continue creating value across a wide range of commodity price environments. I'd also be remiss if I didn't take this opportunity to provide a thank you to a member of our team who will be moving on.

Danny Brown
Danny Brown
President and CEO at Chord Energy

Shannon Kinney, our General Counsel, will be returning to ConocoPhillips, where she spent many years, to fill their open general counsel position. We're sad to see her go, are thankful for her contributions, and wish her all the best. With that, I'd like to thank everyone for your continued interest in Chord Energy. We appreciate you joining us this morning, and we look forward to speaking with many of you over the coming weeks.

Operator

Ladies and gentlemen, this concludes today's conference call. You may now disconnect. Thank you.

Executives
    • Bob Bakanauskas
      Bob Bakanauskas
      VP of Finance
    • Danny Brown
      Danny Brown
      President and CEO
    • Michael Lou
      Michael Lou
      EVP, Chief Strategy Officer, and Chief Commercial Officer
    • Darrin Henke
      Darrin Henke
      EVP and COO
Analysts
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