Deon Daugherty, editor-in-chief, Oil and Gas Investor: Hi, I am Deon Daugherty, editor-in-chief of Oil and Gas Investor. We're here today in Fort Worth at Hart Energy's SUPER DUG Conference and I have Shawn Holzhauser, the VP for development at BPX here to share a few thoughts with us. Shawn, thank you for joining us today.
Shawn Holzhauser, vice president of development, BPX: Thanks for having me. It's a great conference. Super exciting.
DD: So your presentation on the stage was really fascinating and you brought in some references to the firm's approach being a little bit rock-and-roll, a little bit country. How so? Tell us about that.
SH: Yeah, so I use that saying really to reinforce two big things that we hold true is: one, we want to have the entrepreneurial spirit of the U.S. onshore producers that all the folks in the room that were in there made the industry with that spirit. So we want that to be true, but also have all the technical expertise, leverage and full integration from supply chain, trading and shipping that we get from BP. So that's really what I was trying to drive is, we are a little bit country, we have all that entrepreneurial spirit. And a little bit rock-and-roll. We've got the whole super major thing behind us helping us really achieve success.
DD: Right. Okay. Yeah, that makes a lot of sense. So the entrepreneurial, the country guys kind of pulling up by their bootstraps kind of. Okay, alright.
SH: That's right. Figuring out how to make it happen.
DD: Great. Okay. And then you spent some time talking about the BPX-Devon JV dissolution and the upside that BPX has pulled out of that deal. So tell us about that too.
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SH: Yeah, so it was a great deal. We're really, really excited to get it done and I mentioned it in the presentation—Enverus quoted about quarter billion dollars of value kind of coming our way as a result of the deal.
I think that comes in a couple of parts. The main part is we started with 10 [MMbbl/d] more production than they're starting with. So that's driving a lot of value today. The other part of that is there's a lot of overhead charges …, et cetera, that we are going to get some efficiencies from that doesn't show up in those, kind of, external numbers. We're also getting some advantages from marketing from our trading and shipping team, dollars per barrel, if you will, from a sales price. That's really a huge advantage to us. And I think when we look at the asset and how it's split, we think we ended up with a better subsurface than some of our partners did. And really the Devon, the Northeastern part is a little bit more challenging. We view that as needing three strings, which requires a little bit more cost, three drilling strings to really get the reliability and execution that we desire and really be able to drive the long laterals that I was talking about in the assets. So we think we've got a little bit less complicated area, a little bit better subsurface and a team that's really going to get after it and extract the value.
DD: And this was a deal emanating in the Eagle Ford?
SH: Yeah, that's right. It's in the Eagle Ford, our Blackhawk asset. So that's Karnes, DeWitt counties in that area.
DD: Alright, great. Well, Shawn, you've been a great guest today. Thank you so much.
SH: Thank you.
DD: And thank you guys. We hope to see you here at SUPER DUG.
