Gulfport Energy NYSE: GPOR outlined plans to emphasize operating efficiency, inventory expansion, disciplined capital allocation and downstream market access as President and CEO Nick Dell’Osso led his first earnings call in the role following the company’s second-quarter 2026 results.
Dell’Osso said Gulfport enters the second half with accelerating production following its first-half capital program, including liquids volumes expected to be more than 50% higher than first-half 2026 levels. He said the company’s asset base, balance sheet, cost structure and exposure to areas of growing natural-gas demand provide a foundation for long-term shareholder value creation.
“Delivering better and more consistent results for shareholders will be our number one priority,” Dell’Osso said.
Inventory Expansion and Capital Allocation
Gulfport said it has expanded its drilling inventory through leasing, delineation work and development of its Ohio Marcellus opportunities. Dell’Osso pointed to the company’s success in a state land auction and its announced $140 million 2026 budget for discretionary land purchases as key parts of that effort.
According to Dell’Osso, the state-land auction and planned discretionary leasing are expected to increase Gulfport’s net Appalachia location count by about 20%. He said the company has roughly 15 years of drilling inventory and cited an Enverus analysis showing Gulfport has one of the stronger weighted-average inventory breakevens among gas-focused companies.
The CEO said the company will remain selective on acreage purchases, prioritizing value rather than pursuing scale for its own sake. In response to analyst questions, Dell’Osso said Gulfport has a clear view of the opportunities included in its $140 million leasing budget and expects much of the multiyear leasing effort to come to fruition during 2026.
He added that leasing activity should continue beyond this year but likely will not reach the same scale in 2027. That could free up cash flow for other priorities, including share repurchases and debt reduction.
“We will define the terms of competition around creating the highest financial returns and advancing our strategic goals,” Dell’Osso said, listing operational improvements, inventory depth, lower breakevens, market access, financial strength and shareholder returns among those goals.
Dell’Osso said the company intends to maintain a conservative mid-cycle leverage ratio and use hedges to protect capital committed to its drilling program. He said Gulfport will remain active in its share-repurchase program during the second half of 2026, although he did not provide quarterly repurchase guidance.
Focus on More Consistent Execution
A central theme of Dell’Osso’s comments was improving the consistency of Gulfport’s drilling and completion operations. He said some individual wells have performed at a level comparable with the industry’s best execution, but the company sees room to improve planning, data quality and processes across its operations.
Dell’Osso said he would like Gulfport to eventually operate a more consistent capital program rather than one that is heavily weighted toward the front part of the year. He said a steadier operating cadence could help lower well costs and improve execution, though he cautioned that the company may not fully achieve that objective in 2027.
“Consistent, continuous operations will drive our ability to lower our well costs and execute better wells every time that we turn the drill bit,” Dell’Osso said.
Matthew Rucker, Gulfport’s executive vice president and chief operating officer, discussed recent progress in the Marcellus. The company drilled four wells with average lateral lengths of 16,000 feet during the first quarter and completed the pad during the second quarter. Rucker said the completion work maintained drilling momentum, with more than 20 hours of pumping per day and stage placement meeting expectations.
The wells were brought online near the end of the quarter and have completed flowback. Rucker said Gulfport initially choked the wells back during ramp-up and cleanup, but the pad has since been turned up to its full initial-production potential. He said gas and liquids rates have been better than anticipated and that the wells have remained relatively flat.
On costs, Rucker said drilling and completion costs on a per-foot basis were about 25% lower than those of shorter Marcellus laterals drilled last year. He said the results have helped establish a development approach for lateral length and spacing across the remaining acreage.
Natural-Gas Demand and Market Access
Dell’Osso said Gulfport sees potential benefits from growing in-basin natural-gas demand, including demand associated with AI data centers. He said the company already sells significant gas volumes in the basin and benefits from relatively attractive gathering, processing and transportation costs, as well as flexibility around sales destinations.
While Dell’Osso said Gulfport may not be the first choice for the largest 15- to 20-year contracts pursued by larger companies, he said it is positioned to serve projects being developed near its operations. He said Gulfport aims to work with customers on delivery requirements and to ensure its gas can reach available markets.
The company recently released 60,000 per day of firm transportation capacity, or roughly 10% of its takeaway capacity, according to an analyst’s question. Dell’Osso and Executive Vice President and CFO Michael Hodges characterized the move as an active management decision rather than a signal of a broader shift in strategy. Hodges said the company could reach a strong sales point without that transportation and saw an economic uplift from releasing it.
SCOOP Strategy and Executive Transition
On potential larger-scale acquisitions, Dell’Osso said Gulfport will evaluate opportunities only where assets can improve the company at an appropriate valuation. He said the company does not intend to pursue deals simply to become larger and will seek a strategic advantage before bidding on assets.
Dell’Osso also said Gulfport’s SCOOP position remains strategically interesting. While the asset has received limited investment in recent years, he said production has remained relatively steady and the Mid-Continent could eventually provide valuable access to growing Gulf Coast demand. He said the company needs to do additional work to determine the appropriate investment and operating strategy for the asset.
Dell’Osso closed the call by recognizing Hodges, who is leaving the company after choosing to spend more time with his family. Dell’Osso said Hodges leaves Gulfport in a position of financial strength and thanked him for his leadership during the transition.
About Gulfport Energy (NYSE:GPOR)
Gulfport Energy Corporation is an independent oil and gas exploration and production company based in Oklahoma City, Oklahoma. The company focuses on the development of onshore natural gas, natural gas liquids (NGLs) and crude oil properties in the United States. Gulfport utilizes horizontal drilling and multi-stage hydraulic fracturing techniques to maximize production and enhance recovery from its resource plays.
The company's primary operations are concentrated in two major U.S. resource basins.
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