Greetings, and welcome to the Diversified Energy 2025 Interim Results Conference Call and Webcast. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to your host, Douglas Kris, Senior Vice President, Investor Relations and Corporate Communications. Please go ahead.

Good morning, and thank you all for joining us today, and welcome to our second quarter 2025 results conference call. With me today are Diversified's Founder and CEO, Rusty Hutson; and President and Chief Financial Officer, Brad Gray. Before we get started, I will remind everyone that the remarks on the call reflect the financial and operational outlook as of today, August 11, 2025. These outlooks entail assumptions and expectations that involve risks and uncertainties. A discussion of these risks can be found in our regulatory filings. During this call, we also reference certain non-GAAP and non-IFRS financial measures. Our disclosures regarding these items are found in our earnings materials, on our IR website, and in our regulatory filings. I will now turn the call over to Rusty.

Thank you, Doug, and thank you all for joining the call today. We believe Diversified Energy offers a unique investment opportunity, a resilient business model focused on optimizing cash flow from low-decline energy assets, enhanced by growth from strategic acquisitions and disciplined capital allocation. I want to highlight and emphasize that we have significantly transformed and strengthened our company since the start of the year, most notably with the Maverick Natural Resources acquisition. Our growth through the acquisition model has demonstrated how a material change in scale can provide the operational leverage to deliver robust cash flows that ultimately create value for all shareholders. This generated value is evidenced by our growth in EBITDA and cash flow, which nearly doubled year-over-year, and our increased guidance on run rate synergies following our first full quarter with Maverick, demonstrating our focused approach to driving operational efficiencies through the integration of new assets. I want to commend the efforts of our employees. Their hard work and determination allow us to deliver outstanding results and live by our culture of getting things done, which is helping us to be who we want to be every day. Notably, during the quarter, Southern Appalachia experienced dramatic flood damage. Yet while our operations were impacted, these committed employees not only worked to minimize production downtime, but also devoted significant efforts to help those in the communities where they work and live. Our team has positioned Diversified for an exciting future. I am confident we will continue to deliver compelling operational and financial results. Additionally, while we recognize the increased volatility stemming from tariffs, geopolitical disturbances, and other external factors, we do not see a material impact on Diversified's fundamental business. Importantly, we continue to focus on what we can control, operating and optimizing our portfolio of assets to create a scalable business model with highly reliable production and consistent cash flow, which delivers certainty and dependable returns to debt and equity investors alike. While the market for oil and natural gas producers has remained volatile throughout 2025, we know that if it's hard, there is opportunity. For those of you following along with our second quarter 2025 results slide deck, which we posted to our IR website this morning, I will cover a few slides and then turn the call over to Brad to discuss highlights from our financial results. After Brad's remarks, I will provide some additional thoughts on our valuation and guidance for 2025 before opening the call for your questions. Starting on Slide 3. We continue to focus our capital allocation strategy around four key pillars that are deliverables to judge us by: systematic debt reduction; returning capital to shareholders through dividend distributions and share repurchases; and growing our portfolio of cash-generating assets through accretive and strategic acquisitions. As you can see here, we continue to build that credibility in 2025. Debt principal reduction totaled approximately $130 million during the first half of 2025. Additionally, we returned approximately $105 million to shareholders in the form of dividends and strategic share repurchases. Worth noting, we have a demonstrated track record of shareholder returns with approximately $2 billion in shareholder returns and debt principal repayments since our IPO in 2017, or approximately 1.6 times our current market capitalization. We have also increased our total proved reserves by 65% since year-end 2024, illustrating the strength, resilience, and value of our asset base. Importantly, we believe our shares remain a compelling investment at current levels, and we will continue to take advantage of the current cycle and market dislocation to opportunistically repurchase shares. Together, these actions in 2025 represent a return of approximately 20% of our current equity market cap, demonstrating the power of our disciplined and flexible capital allocation strategy and the quality and consistency of our portfolio of cash-generating assets. We accomplished all this while integrating our transformational Maverick acquisition. With deal-related expenses behind us and a line of sight to synergy capture in the second half of the year, we are well positioned to continue to be a market leader in returning capital to stakeholders. We believe our capital allocation strategy balances investment in the business and portfolio growth initiatives while enabling a tangible shareholder return framework, all of which creates long-term value for our stakeholders. We continue to demonstrate that Diversified is a focused company that invests in cash-generating assets in the energy industry, and we will remain focused on our key strategic pillars. Turning to Slide 4. With our strong liquidity and our recently announced capital deployment partnership with Carlyle, Diversified has unmatched operational scale as well as an advantageous cost of capital and surety of capital, positioning Diversified to support accretive acquisitions in a growing divestiture market. We have now coupled our operational excellence-focused culture with a track record of margin enhancement and earnings growth with a global investment leader, the Carlyle Group. Through this partnership, we intend to prioritize the accretive acquisition investment capital to grow our PDP asset portfolio and optimize returns through synergy capture and portfolio optimizations. Carlyle has historically been an investor in our ABS securitizations, and we are pleased with the expanded relationship that we have created along with the shared vision of the potential opportunity set ahead. As the PDP champion in the United States, we continue to see a robust opportunity ahead in the coming years. The combination of maturing assets and M&A activity leading to growth-oriented E&Ps recycling capital through the divestment of assets, in many cases, mature producing assets, there remains an ample opportunity for Diversified's continued growth. Additionally, given our industry-wide reputation as a professional and responsible operator of large portfolios of energy-producing assets and the current upstream market dynamic of E&Ps making acquisitions to backfill and expand undeveloped inventory, Diversified provides a creative and actionable solution as a PDP partner in a joint acquisition. With this partnership with Carlyle, we now have a line of sight to fund up to an initial $2 billion worth of acquisitions without raising a single new share of equity capital. That's a powerful endorsement of our abilities and our strategy and a clear path to non-dilutive growth. Turning to Slide 5. I was pleased to have the opportunity to attend the inaugural Appalachian Energy and Innovation Summit held in Pittsburgh a few weeks ago. There continues to be growing excitement on the demand pool of data center development within the entirety of the Appalachian region. The pledge headline investment within Pennsylvania alone has the potential to provide a generational economic impact, which can ultimately drive regulatory and legislative streamlining. Our proximity to emerging data center hubs positions us to benefit from rising natural gas demand, whether through direct supply agreements or improved basin pricing. Notably, in-basin natural gas differentials have already shown improvement. If you believe in the secular trends of natural gas power, energy demand, data center build-out, and LNG growth, then you should be bullish on Diversified. With that, I'll turn it over to Brad to discuss our financial performance and portfolio optimization results in greater detail.

Thank you, Rusty. We'll turn to Slide 6 now. And before sharing the highlights of our financial and operational results for the second quarter, I would like to focus on the left side of this slide. This presentation very simply illustrates how our accretive growth of cash-generating energy assets paired with best-in-class operational and corporate infrastructure framework translates into material bottom line growth. Over the last 5 years, we have experienced a greater than 310% increase in our adjusted EBITDA. For the second quarter, we'll start with production. The daily production exit rate for June was approximately 1.14 Bcf per day, and our quarterly production averaged over 1.15 Bcf per day. Notably, approximately 65% of our produced volumes were generated in our expanded Central region. The growth in our low decline, resilient production base has put the company in a great position to participate in both LNG exports and data center energy demand while continuing to supply our local communities and our commercial customers. Total revenue was approximately $510 million, and adjusted EBITDA for the quarter was $280 million. Adjusted EBITDA was $418 million for the first half of 2025, and our second quarter adjusted EBITDA margin was 63%. As we continue our integration process and improve our combined company cost structure, we anticipate that we will be able to maintain our historical approximately 50% cash margins. Notably, our portfolio optimization processes in the second quarter allowed us to generate approximately $70 million in additional cash proceeds. These incremental proceeds increase our return on investment from the Maverick acquisition. And the best way that I can describe it is that it was highly impactful in the quarter. The quarter's free cash flow was $88 million, which was burdened with approximately $25 million of nonrecurring transaction-related costs. And our net debt stood at approximately $2.6 billion for the quarter. We improved our overall leverage by 10%, making continued progress to our target level of 2.0x to 2.5x net debt to EBITDA. With approximately $420 million in liquidity, our balance sheet strength is giving us the optionality and flexibility to navigate potentially to take advantage of volatile markets and commodity price cycles. Additionally, our investment-grade rated nonrecourse, stable, longer-term ABS notes helped contribute to our financial resilience. In summary, our team's strong execution of our strategy to acquire stable, consistent cash-generating assets delivered positive results, enabling strong free cash flow generation and allowing us to continue to prioritize returning capital to shareholders and paying down debt. Turning now to Slide 7. One of the main benefits of the recently completed Maverick acquisition is that we now have multiple drivers of cash flow generation and growth. Our expanded asset portfolio will benefit from a low decline production profile, commodity diversification, our disciplined hedging program, and the potential for additional upside from anticipated operational and administrative synergies. The chart on the bottom of this page highlights the results of our expanding asset portfolio. We have delivered both sequential and year-over-year growth in free cash flow. Now turning to Slide 8. On this slide, we have provided more details around our non-op joint venture partnership, which is located in the Western Anadarko Basin. This capital-light approach with an industry leader offers an elegant solution for adding production and ultimately free cash flow while delivering a compelling return profile. Year-to-date, we have seen an approximately 60% rate of return on these new wells, which are trending approximately 75% liquids. Notably, this additive production serves to meaningfully offset our stated 10% annual corporate production decline. Additionally, we have a very healthy inventory of approximately 245 additional identified locations for future development that will support future cash flow generation. We'll now turn to Slide 9. Our proven approach to capturing additional value and achieving meaningful synergies continues to deliver upside to our original estimates. Our annual synergy run rate has been raised to approximately $60 million. We have integrated our field operations at this point, and we are in the late stages of finalizing our corporate-level processes. We are very confident that our enhanced scale will provide additional opportunities for improvement. One example worth calling out is a pipeline swap transaction with a large midstream provider we completed in the second quarter. With our expanded Oklahoma operating footprint, we were able to acquire gathering system infrastructure that allows us now to flow our molecules on a no-fee Diversified-owned pipeline, along with a reduction in field-level expenses, which has provided material margin enhancement. And with the ability to tie in additional fee-based volumes, wellhead compression eliminations, and improved emissions performance, we are seeing the benefits of our expanded scale. The creative execution of our skilled field teams continue to generate cash flow just months after the closure of our acquisition. Turning now to Slide 10. Our stewardship operating model is supported by our long-tested smarter asset management practices, which optimize the cash flow from the assets we acquire through both production enhancements and expense efficiency. A great illustration of our team's efforts is the current workover program in our Oklahoma basin. With low capital outlay and quick average paybacks, we are improving the productivity and profitability of these wells. And by leveraging our technology stack, we are confident that we are setting a course to manage these wells for many decades into the future. And now turning to Slide 11. Over the past few years, we have highlighted our Black Bear processing plant, which is located on the Louisiana side of the Haynesville and Cotton Valley basins. We are happy to have recently struck a multifaceted, multiyear deal that provides gas processing dedication from the purchaser who will pay third-party fees to Diversified. And we love third-party fees because they enhance our free cash flow. And with this contract, the Black Bear plant will be fully utilized, providing fixed operational cost absorption. These three cash-generating examples demonstrate our focus on optimizing and increasing return from our expanded portfolio of assets. Our daily priorities require us to look for, find, and execute activities that enhance our margins. Our daily priorities drive additional cash flow and long-term, they create value for our shareholders. These daily priorities, which are safety, production, efficiency, and enjoyment, are unique to Diversified, and they will allow the company to continue to generate resilient, consistent free cash flow as the PDP champion of the upstream sector. And to wrap up my comments, I want to say thank you to all of our teams for their excellent work during the first half of 2025. Our company is the strongest it has ever been, and this position is due to the hard and smart work from our skilled team of professionals. The American Energy worker is a special class of people, and our teams are at the top. I will now turn the call over to Rusty for some final thoughts.

Thanks, Brad. Before we take questions, let me provide some thoughts on our current valuation, company outlook for the balance of 2025, and how we believe our success strategy for the future will look in the coming year. Turning to Slide 12. Translating these results into comparable data points, you can clearly see that Diversified is a leader in several valuation categories, not only with upstream and natural gas peers, but also across various sectors and market cap sizes. Since our IPO, we have returned approximately $2 billion in shareholder returns and debt payments, which shows the strength of our strategy to acquire cash-generating assets and to operate them with operational excellence. These shareholder returns show our commitment to create value. However, the current share price does not reflect these attributes and our consistent results. Turning to Slide 13. We believe our share price is undervalued and has been impacted by macro headwinds that are not connected with our company's compelling fundamentals or our consistent performance. We have demonstrated EBITDA growth of 310% over the past 5 years or over 60% annually, as we highlighted earlier. Based on the EV to EBITDA metrics where we historically traded and compared to multiples of natural gas peers, the calculation would yield a much higher share price. We strongly believe there's a real opportunity for a re-rate of our shares to create a meaningful increase in our share price. With a number of near-term catalysts on the horizon, including the full integration of identified and quantified synergies, the cash generation proceeds from continued portfolio optimization, our emerging coal mine methane opportunity, and the continually consolidating landscape of North American operators, we believe that our proven cash-generating business strategy, coupled with our significant capabilities and scale, has us positioned to generate meaningful shareholder value. Turning to Slide 14. We continue to maintain momentum into the second half of the year. And with the Maverick integration progress nearly complete, we have increased our targeted run rate synergies to approximately $60 million. Importantly, with our targeted daily production of over 1 Bcf and more than $420 million in free cash flow, the company is positioned on a path that creates a unique and compelling investment opportunity. We are pleased with how we started the year and confident in our ability to execute for the balance of the year. My commitment to our shareholders is that we will continue executing each day while building a resilient portfolio of cash-generating assets for tomorrow. On Slide 15, as we continue to emphasize, we are a differentiated energy producer that seeks to optimize existing long-life and often overlooked and undervalued cash-generating U.S. energy assets. We seek to maximize value that drives shareholder returns in a unique way by minimizing traditional E&P risk, growing our revenue streams, optimizing our asset portfolio, and being good stewards of our capital while generating meaningful and consistent cash flow. Our results reflect our continued focus on building a strategic, resilient manager and operator of energy-producing assets. We believe we are the champion of the PDP subsector within the upstream E&P space. As the only publicly traded company focused exclusively on PDP assets, Diversified offers investors access to a proven private equity roll-up strategy with the added advantage of Diversified's scale and vertical integration to drive superior returns. We remain focused on building a portfolio of assets through value-accretive transactions while simultaneously unlocking hidden value through our unique operational framework, strategic development partnerships, and growing adjacent business segments. Diversified offers unique value creation attributes, which provide us with a competitive advantage. With our large operational scale, vertical integration, and corporate infrastructure that leverages a leading technology platform, we have a proven integration process that allows us to streamline and capture meaningful synergies. We have executed that playbook 30 times over the past 7 years. Every internal investment, portfolio optimization, and acquisition is about accelerating progress, creating meaningful synergies, and delivering real sustainable value. It's not about size, it's about outcomes—financial, operational, and strategic. We have been steadfast in executing our strategy since our IPO, driving strong financial and operational performance. The right company, right time mindset for the type of assets we manage delivers consistent free cash flow and returns to shareholders and serves a fundamental role in sustaining the U.S. energy markets. Before I turn the call over to the operator for Q&A, I'd like to take a minute to again recognize our employees for their outstanding achievements and contributions. Without their excellent work in the field and in the corporate office, these results would not be achievable. With that, I'd like to turn it over to the operator for the Q&A portion of today's call.

Our first question today is from Jon Mardini from KeyBanc Capital Markets.

Just on the Oklahoma JV, I appreciate the slide laying out some of the detail around the partnership. How do you see this JV fitting into the core of your portfolio, just given it's more liquids weighted along with the recurring CapEx associated with its growth? Is it something you could look to maybe expand on beyond the current scope of the partnership? Is it more of a steady-state program? Just any framework around how you think about the partnership would be helpful.

Yes. I think that it's just kind of a steady-as-you-go type program. We have multi-year development here with our JV partner. We have a decent working exercise in this acreage position. We have a lot of running room, with 240-some-odd locations still to go. The return thresholds have been great. So I think it's kind of a steady as you go, really just the way that's laid out here on this slide. I would say down the road that there are other opportunities in other basins that we could expand that partnership with. We definitely have a fairly large Permian Basin position now that we're currently evaluating to see if there are opportunities there to do something similar. So I would say this in Oklahoma, as it relates to Oklahoma, it's steady as you go, but there could be opportunities elsewhere as we evaluate our acreage position.

I appreciate the detail there. Just on the Carlyle JV, there's been some industry activity recently related to some PDP-focused deals. Just curious how discussions have been going around deal procurement associated with the partnership? Has there been maybe an uptick in opportunities you've seen that may fit within the parameters of the structure?

Yes. No, we're evaluating opportunities consistently with our partner, Carlyle. The key for us is the right type of acquisition, number one, the right type of assets, number two, and then making sure that we don't overpay for stuff. Some of the best deals you'll do are the ones you don't do, and we need to make sure that we're staying disciplined in our approach, getting the best value that we can, and ensuring that we're getting the returns that we need. But we'll definitely do deals here in the near term with Carlyle. There's a lot of momentum there. And so the other thing I would say is I love that commodity prices have come off quite a bit, both oil and natural gas. And as you guys know, that's typically a pretty good environment for our acquisition strategy as we see those assets, or as we see those commodity prices come off that we can start to search for value out there again. So we'll get some deals done with them in the near term.

And I'll just add. We've been very encouraged and pleased with the level of engagement from Carlyle. They've been at the table with us evaluating potential transactions and are very engaged. So as Rusty said, we're confident that we'll be able to put some money to work here in the future.

Next question today is coming from David Round from Stifel.

First one for me, on the land sales, I think you're only expecting to sell $40 million of undeveloped acreage in the first half. So I mean, the question is, is there anything else in that $70 million number to be aware of? Or can you help bridge the gap and just let us know what you were able to sell that maybe you weren't expecting to at the start of the year? And I know you're able to guide or at least help us sort of get a bit of a steer on what that number could look like for the full year, please?

Yes. David, I think it was really just a combination of some higher realizations on the per-acre amount that we were anticipating. And then we did have some additional interest on some various and sundry acreage positions, as some of the developers were looking to put positions together; they needed some of the blocks to put their drilling programs in place. And that gave us an opportunity to take advantage of some additional sales - this is the primary answer. I mean these were all primarily focused in the Western Anadarko Basin, where we are the largest leaseholder in that area. So that just continues to give us great opportunities. As we highlighted in numerous places in the presentation and in Rusty's comments, this is part of our asset optimization that we do when we get a portfolio of assets. We're looking for all ways that we can enhance margins and drive additional returns. And this one has been a great one. I think I said in my comments, it was highly impactful. And so that was just a good opportunity that our land and legal teams were able to take advantage of. As we go forward for the second half of the year, and as Rusty indicated, we are looking at some of our Permian positions and looking for ways that we might be able to do some development, maybe some land opportunities or some affluent, but what I like to call is asset optimization opportunities in some of that acreage. But that's all under review at this point. And we're not at a point where we're ready to add some additional guidance on that front.

Yes, David, I'll just leave it with this: as we evaluate all of our acreage positions and we determine which ones make sense to generate value externally versus coming up with a way to take advantage of that value organically, I am being surprised by the level of interest, but also in the level of value that some people are willing to pay for some of these acreage positions as they look to generate more inventory to drill. So fingers crossed, we'll continue to market and figure out which positions we want to let go. But we're pretty confident that there will be more. I just don't know what that amount is going to be at this point.

As a second question, are you able to just provide a bit of information on the well retirements, please? And I'm thinking particularly about the third-party part of that business, how that's tracking versus last year?

Sure. The first point I'd like to call out, and we had this in our announcement this morning, is the fact that over the last several years, we plugged over 1,100 wells. That's a stat that we're extremely proud of. That's required a lot of investment. We've built up our next-level energy plugging company in the Appalachia Basin. So we've been active. We continue to be active. Most of the - as it relates to third-party activity, yes, we're getting our share of third-party revenue and plugging activity in the Appalachia Basin. It's not as robust as it was back in 2023 when the federal money was really flowing with the initial slug of cash that came out. But it's consistent, and some of the state programs are rolling out as well. So we're trying to be - just like we do with all of our assets and all of our cash flow opportunities, we're trying to make good decisions with how we allocate our assets, either internally or externally. And we're going to plug close to 400 wells or so this year, I believe, is the pace that we're on. So we're very proud of all the wells that we've been able to impact here over the last several years.

Next question today is coming from Paul Diamond from Citibank.

I just wanted to quickly talk about, I know a large kind of macro theme in the space has been in the AI data center theme. Given your position in Appalachia, just wanted to talk about - I want to get your idea on how you see your role in that opportunity set as it develops and if any conversations are ongoing or kind of how you're viewing recent announcements?

Yes, that's a great question. I'm highly enthused as to - as I said, being in that Pennsylvania Summit, the amount of investment that was announced just on that day alone—$90 billion worth of power generation, natural gas power generation, data center build-outs. The way that I see us fitting in is we could definitely fit in on a small-scale, smaller power generation off-grid source type power generation sources. And we're constantly evaluating some opportunities there. But I think the biggest impact for us is just purely on pricing alone. As natural gas demand increases, it will continue to put pressure, contraction pressure on basis differentials. And that to us is a big impact, and that significantly impacts our ability to hedge better pricing and get better net price in the basin. So between all of that and then you throw in the constitution pipeline and some other things, I think that it will - the biggest impact for us is in pricing. But there's no doubt that the demand for natural gas in Appalachia is going to increase substantially. I think a lot of that will be for power generation, but then off-grid sources also. And so we're on the lookout for ways that we can participate on a much smaller scale than, say, somebody like EQT is going to provide 1.2 Bcf a day to two power sources. But we think there are ways for us to get involved smaller on a smaller scale, but also reap the benefits of what the demand that's coming to market is going to do for pricing.

Just a quick follow-up, more bookkeeping than anything else. The bump in synergy capture you guys are expecting now to close to $60 million. Can you just give me an idea of what the delta is between prior expectations and what you're seeing now?

Yes. So our initial estimates were related - the $50 million mark was what we kind of identified during our due diligence process. But as we've gotten in, got on the ground, and started to look at things a little closer, we were able to find other areas. It's really remarkable. When you sit down and you look at some of the things that we've been able to do and the creativity of our field employees and finding these things, it's truly been remarkable. And that $60 million, we're highly confident in the $60 million number. Did you want to add anything there?

Well, like Rusty said, the scale that we have in that Western Oklahoma area just continues to provide a lot of opportunities and synergies for us. So that's the primary driver of the increase.

Our next question is coming from Tim Moore from Clear Street.

Congratulations on the quarter. Now that you've had a full quarter of Maverick Resources ownership completed and field operations integrated, can you maybe just speak a little bit more about the footprint expansion opportunities? I mean, you got Cherokee, Oklahoma, you mentioned, you got that great slide. Any other areas you're looking to kind of optimize? You mentioned a little bit maybe in the Permian. And I know you just covered a little bit of the cost synergies upside for Western Oklahoma. But can you speak to like any other specifics that you're really identifying for optimization that might even give you some creep to that $60 million cost synergy number?

Well, I'll let Brad chime in. But from my perspective, the optimization of the portfolio really changes every day. I mean, we obviously are doing a portfolio review and looking at all of our acreage positions, as I said during the call. And then we looked at which ones we want to look external to create value. But it also— a lot of it comes from just people calling and saying, hey, you got this acreage position over here that we'd like to make an offer on. When we put it out and we start to make it competitive, it's amazing where those prices for those positions go. And so we've been pretty successful doing that. The $60 million, like I said, it's come from a variety of areas. It's come from field. It's come from G&A. It's come from finding additional ways to mold the two portfolios together, both Maverick and Diversified. And so it's come from different angles. But look, the one thing I'm very confident in as we move forward, things that we don't know today will become opportunities tomorrow. We're highly confident as our people start to really get on the ground and start doing things day-to-day that they're going to find ways to take the two portfolios and be more efficient in the way we're operating, release compression, add compression; there are all kinds of ways to create additional value. So we don't even know what it all is going to be yet. I mean the $60 million is stuff we've identified, but there could be more stuff coming down the future.

Yes. And from a growth perspective standpoint, one of the things that I really like about our position at this point is the fact that we operate in five basins. So we've got significant Appalachian operations. We've got significant Oklahoma. We've got a very attractive franchise in the Cotton Valley, Haynesville area, and now we're in the Permian as well. So as we look for ways and areas that we can grow and build additional scale, we have options. We've got a very active business development team. Rusty leads our M&A activities. So we're not forced into a 2-3 county area or one basin. We have the ability to drive synergies and increase scale in five different basins. And then you match that with our expanded liquidity and our very scalable corporate infrastructure, that puts us in a very positive position.

Next question is coming from Charles Meade from Johnson Rice.

I wanted to ask a question about the - your Slide 8, and this is about really the JV that came with Maverick. So you guys say on your kind of your second, I guess, block on the left there that you have the potential to meaningfully offset 10% corporate decline. I'm wondering if you could frame that up in terms of magnitude, and also what time frame—and not to say it's inconsistent, but you've reiterated your guide for the balance of '25. So should we be thinking about a meaningful offset to your decline in '26? And does that mean overall, the top line goes to an 8% decline? Or does it mean it goes to a 5%? If you could just kind of frame that up for me.

Yes. I mean, we're still trying to get our hands around that. But we do know that this program is going to give us a material amount of production next year that we don't have this year. So we'll probably have more color on that as we get toward the end of the year in terms of what those production rates do to our overall decline. But as you can imagine, a 1% or 2% reduction in decline rates is substantial to our bottom line with the size and scale of the company as it is today. So we're excited about that. It's our first real or what I would consider to be organic other than just workovers and things that we do in the portfolio day-to-day. It is really our first true organic mechanism in the portfolio as a company to stave off decline rates. Our JV partner is fantastic. Their top line, they do a fantastic job. We're really excited about it. The returns, the IRRs on these wells have been great, even in a lower commodity price environment like we've seen over the last couple of months. So it's just a great opportunity for us. We're excited about it. We'll have more information as we get to the end of the year in terms of how this thing is going to impact '26, but there's no doubt that it will have an impact on 2026.

Can you share if there has been interest in other areas besides the Cherokee? Are people expressing a desire for deeper rights? What is the development of the target horizons that you observe in the Western Anadarko?

Yes. No, we've seen a lot of interest in the Western Anadarko in different formations, different acreage areas. We have let a lot of those go to external parties through optimization efforts. Some we've participated on a smaller scale than, say, this JV. But look, what I would say is Oklahoma and Texas—everything seems to be an opportunity for companies if you find the right one. We have a great land group that does a fantastic job of taking our land positions, accumulating and summarizing them and then taking them out to see if there's value to be obtained. And so this will be a part of our business moving forward to some level as we take all this acreage and determine what we have. Really, through the Maverick transaction, we—for the first time, we have great engineering support to be able to look at our acreage positions and really give us an analysis of what it represents to us if we do something with it ourselves or whether it's better off in the hands of someone else. It's just really a migrating process that is now starting to show and really create value.

We've reached the end of our question-and-answer session. I'd like to turn the floor back over to Rusty for any further or closing comments.

Yes. Thank you all for attending today's call. We look forward to meeting later in the year to talk more about the numbers, and have a great day.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.