Noble Energy's (NBL) CEO Dave Stover on Q3 2014 Results - Earnings Call Transcript
Oct. 28, 2014 7:10 PM ET  |  About: Noble Energy, Inc. (NBL)
 

Welcome to Noble Energy's Third Quarter 2014 Earnings Call. At this time, I would like to turn the call over to Mr. David Larson. Please go ahead, sir.

David Larson
Thank you. Good morning, everyone. Welcome to Noble Energy's third quarter 2014 earnings call and webcast. This morning we issued our quarterly earnings release which hopefully you have had a chance to review. A few supplemental slides for this call were also posted to our website and they will be good reference material for the discussion today.

Following remarks by Chuck Davidson and Dave Stover, we will open the call for Q&A and with the executive team. We would ask that all participants limit themselves to one primary question and one follow-up. Finally, I want to remind everyone that this webcast and conference call contains forward-looking statements, as well as references to non-GAAP financial measures. You should read our disclosures in our latest news release and SEC filings for a discussion of those. With that, let me turn the call over to Chuck.

Chuck Davidson
Thanks, David. Good morning, everyone, and thank you for joining us. My opening comments are going to be brief today. Our leadership transition that we announced last April remains on schedule with the announcement this past week of the election of Dave as our new CEO.

Dave will be an excellent CEO for Noble Energy and is perfect to lead the Company through its next phase of growth. He's been an integral part of our success to this stage and has all the skills, as well as an outstanding leadership team to support him as we move forward.

I'll continue as Chairman until next May, when I will be retiring from Noble Energy. My job between now and then is to work closely with Dave and the executive team to make sure that this transition continues to unfold smoothly and seamlessly and I have all the confidence that it will. I do want to take a step back for a moment and share my thoughts on where I believe Noble Energy is today and where we are headed. Noble is a Company that is built for the long-term. We have said that many times in the past. We've established ourselves as a diversified exploration and production Company that excels in onshore unconventional development, as well as offshore exploration.

In the U.S., we have core positions in two of the premier unconventional oil and gas plays, which are delivering value for our Company and its shareholders. Offshore, we have three core areas, which provided meaningful volume and cash flow growth through exploration success and project execution.

In addition, we’ve a material exploration program in front of us, which will provide running room for the future.

Our diversified portfolio of assets is designed to deliver value in a variety of operating environments. As we've said before, we are not a single play Company, nor are we limited to a single commodity market. We have a portfolio of opportunities around the world that is well-balanced between liquids, as well as both domestic and international national gas, which gives us choices to effectively allocate capital and create value.

This portfolio results in a very unique, multi-year profile for a Company. It's why I believe that Noble Energy is well-positioned to deliver positive differential performance over the coming years. So with that quick introduction let me turn the call over to Dave and the team.

Dave Stover
Thanks Chuck. I appreciate those nice comments, and before I launch into the quarter, let me make a few comments of my own. The time goes by so fast that it is hard to believe I worked with Chuck for about 25 years now, from ARCO to Vastar to Noble. One of the things I admire about Chuck is his ability to handle adversity and always be thinking of long-term implication. It is a testament to him that these traits have become part of the DNA of Noble Energy.

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noble energy site:  http://investors.nobleenergyinc.com/releasedetail.cfm?ReleaseID=878550

EASTERN MEDITERRANEAN

In the Eastern Mediterranean, Israel natural gas sales volumes averaged a record 265 MMcfe/d, up 21 percent from the second quarter of 2014 and three percent from the third quarter of last year.  Highlights for the quarter included:

• Exceptional reservoir and facility performance continued at Tamar, with only two hours of downtime experienced during the quarter.
• Additional progress was made at the Ashdod Onshore Terminal compression project, which is approximately 80 percent complete.  The expansion is targeted to increase deliverability at Tamar to 1.2 billion cubic feet per day (Bcf/d), gross, beginning in mid-2015.
• Debottlenecking of the Tamar facilities has increased current peak production deliverability at Tamar to more than 1.1 Bcf/d, gross.  This peak production rate was reached at various intervals during the third quarter to meet local Israel demand for natural gas.
• Executed a Letter of Intent to supply a minimum of 300 MMcf/d of natural gas for 15 years from the Leviathan field to the National Electric Power Company of Jordan.  Combined for Tamar and Leviathan, Noble Energy and partners have executed Letters of Intent to export gross daily volumes of up to 1.7 Bcf/d and total volumes of more than 8 trillion cubic feet of natural gas to regional export customers.  Negotiations of final gas purchase and sales agreements are underway.
• Received Israel government approval for a Leviathan gas delivery point in the northern region of the country.
• Submitted the Plan of Development for the initial phase of development at the Leviathan field to the Ministry of Energy and Water Resources.  The initial phase of development is planned to include a 1.6 Bcf/d Floating, Production, Storage, and Offloading (FPSO) vessel, with initial sales targeted to begin in early 2018 at 75 percent of total FPSO capacity