Good morning. My name is Kathy and I will be your conference operator today. At this time, I would like to welcome everyone to the Midstates Second Quarter 2014 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions). Thank you. I will now like to turn today’s conference over to Al Petrie, Investor Relations Coordinator. Please go ahead, sir.

Thank you, Kathy. Good morning, everyone, and welcome to Midstates Petroleum second quarter 2014 earnings conference call. Joining me today as speakers are Peter Hill, Interim President and CEO; and Nelson Haight, our Senior VP and CFO. Peter will begin today's call with an overview of the quarter and operational highlights. Nelson will follow with additional financial details and provide guidance for the third quarter and full year 2014. Peter will then wrap up with some brief closing comments. Before we begin, let’s get the administrative details out of the way with our Safe Harbor statement. This conference call contains certain projections and other forward-looking information and statements regarding Midstates. Any statements included in this conference call or in our press release that address activities, events or developments that Midstates expects, believes, plans, project, estimates or anticipates will or may occur in the future are forward-looking statements. These include statements regarding reserve and production estimates, oil and natural gas prices, the impact of derivative positions, production expense estimates, cash flow estimates, future financial performance, planned capital expenditures, future potential drilling locations, resource potential and other matters that are discussed in Midstates' filings with the SEC. These statements are based on current expectations and projections about future events involve known and unknown risk, uncertainties and other factors that may cause actual results performance to be materially different from any future results or performance expressed or implied by these forward-looking statements. Please refer to Midstates' filings with the SEC and the second quarter form 10-Q that will be filed shortly for a discussion of these risks. Also, please note that any non-GAAP financial measures discussed in this call are defined and reconciled to most directly comparable GAAP measure in the tables in yesterday's earnings release. I will now turn the call over to Peter for his comments.

Yes. Good morning everyone and thanks very much for joining us today. In the second quarter of 2014 we generated record adjusted EBITDA of $122 million with record production averaging just under 32,000 Boe per day. We continue to focus on value growth on our increasing production, lower cash costs and strong margins lead to this EBITDA performance. Our operating costs were well below our guidance at $6.79 a Boe and this was driven by the continued efficiencies in the Miss Lime where we saw our operating cost fall to $4.50 a Boe. This best in class performance in our operating metrics in the Miss Lime is driven by the focus on capital efficiency and we will continue to reap the benefits of these efficiencies as we move forward. So to me, this was a very solid clean quarter overall and we're building a momentum of value growth based on our operating performance. As an example, July production is another record of 33,300 barrels of equivalent a day with the Miss Lime contributing some 23,000 Boe per of that performance. And we believe we're well on our way to meeting our full year EBITDA operating CapEx and production guidance which we're reconfirming today at between $500 million and $550 million and 32,000 Boe to 35,000 Boe per day respectively. Since starting this interim role in early April, the first thing we all did was to sort of layout and reenergize the Midstates strategic agenda. I think we've made meaningful progress towards improving the balance sheet and with the closing of the Pine Prairie sale and the Fleetwood exploration agreement these provided upfront cash as well as capital carry that will enable us to test this exciting area of organic growth. We're also on track to deliver on our overarching 2014…

Thanks, Peter. First off, I am very pleased with financial results we announced yesterday afternoon. Our record high adjusted EBITDA of $122.1 million before $2.5 million of transaction costs was above expectations and was up 88% from $64.9 million in the second quarter of 2013 and up 10% from $111.4 million in the first quarter of 2014. Our results benefited from the growth in production volumes which were up 63% in the second quarter of the prior year and even after the sale of the Pine Prairie assets, which was closed on May 1, were up 10% from the first quarter of this year. Significantly, lower cash operating costs and in particular lower LOE also contributed to the growth in adjusted EBITDA. We believe we remain on track with our estimated 2014 adjusted EBITDA range of between $500 million and $550 million. As both Peter and I have said many times over the last several months in presentations and discussions with investors and analysts, we plan to balance our full year 2014 capital program with our expected EBITDA and we will adjust that capital spend if our EBITDA expectations change. Keep in mind that when we talk about CapEx we're referring to cash CapEx for drilling and completions seismic and land acquisition. It does not include capitalized interest G&A and asset retirement obligations. Our cash capital investment in operations from the second quarter was roughly $141 million with about $93 million in our Mississippian Lime properties $45 million in our Anadarko Basin properties and $2 million in the Gulf Coast which in total consistent with the high end of our guidance. The CapEx for the Mississippian Lime includes about $10 million in spending related to the fracture stimulation of 10 wells that had initially been produced as open-hole completions. We…

Thank you, Nelson. So I think we've had a very solid second quarter, clean numbers and I think we are delivering well on our strategic objectives. We sustained that momentum with further growth in production and continue our focus on capital investment, discipline, careful managing our liquidity, and controlling operating costs. We planned a Houston Analyst Day in November after our third quarter earnings to probably demonstrate the potential and value growth that we see in the acreage portfolio. It will be very much soup-to-nuts approach and we'll keep you advised on the progress and timing of that meeting. With that, I would like to now turn it back to Al and let's get started on some questions.

Okay, Kathy we're ready for questions. Please limit your questions to one and a follow-up.

Thank you. (Operator Instructions). Okay. Your first question comes from Neal Dingmann with SunTrust.

Peter, nice job turning things around. First question, Peter just on the Anadarko, on that Tonkawa, you mentioned that the great well that 850 plus well. When and around that when you look at that is, there is something different that you all did around the drilling and completion there or is it just kind of where that one is located or how the rocks turned out there?

Yes, good morning Neal. It was drilled by New Bern and we farmed into the original well, the Misko well. And the key criteria really is some very careful mapping and taking a good look at the Tonkawa sand system and it happened to be a) was pretty thick and b) where we were getting porosities that were in excess of 8%. So all in all the rocks were pretty good and the well was drilled very carefully, very well and it got the result it got. As a result of that the follow-up was pretty instant. We've got two wells now right juxtaposed next to the multi-wells that are cleaning up as we speak. And we've got a number of other wells planned and it's opened up a whole fairway of opportunity 40, 50 maybe even more locations that become readily available for us to test in similar circumstance, so let's see what we do.

Got it.

Very encouraging.

It sounds like it and then just one, my last one, just obviously on the Mississippi or the Miss looks like this overall completion really started to work and you talked about sort of continuing to map that out. Your thoughts, I know, you'll probably discuss this more at the Analyst Day later this year but it does sound like this seems to be working but I'm just trying to get a sense in do you have a sense yet of how much of your acreage or what kind of percent you might be able to do this? And is this something that you'll build and bring the cost down a little bit more in these open hole completion?

I think there were about eight questions in there Neal but let me see what I can get through. Let me step back and sort of take it to a high level. Open hole completions are about one tool that we're looking at to help us with the process of enhancing the value and what we're doing. It's all wrapped up with downspacing; it's all wrapped up with better understanding the rock system; it's all wrapped up with kind of complete these wells in a fundamentally efficient way. And open hole completions are one tool. Yes, they allow you to bring on a well very quickly. They allow you initially very low costs but they do decline. And then what you have to go back in is recomplete them, set casing, set cement, and then go through a conventional 25 stage frac job. That then brings you back on. And in certain instances in a good many instances it seems that we appear to be accessing additional volumes of oil in place that we wouldn't otherwise access through that well. We then compare that with wells which we've now got right alongside each other where we've got an open hole together with a cased hole and we compare those two. And we can see again a lot of benefits from doing the conventional cased hole and it's not always apparent that you get significant benefit. And if you look at that from a longer-term perspective, then you say to yourself, okay, I've got tools now to use and apply as best I can, where do I best apply it and that's what we are doing. We then got this whole business of bilaterals and trilaterals. We're still doing work with those to see if they can lower our cost further and give us more oil out of conventional reservoir and in a way that is cheaper, better, and more efficient. So again, we're looking at those elements of the whole program. So I wouldn't want to just say that we're just saying we get great results on open hole completions and then follow it with a further cased hole. It's all part of the balance Neal. It's all part of the business of us trying to get more efficient as best we can and use the dollars as best we can with the completions we've got on our disposal.

And our next question will come from the line of Chad Mabry with MLV & Co. Chad Mabry - MLV & Co.: I had a follow-up to the previous question you're looking at the average 30 day IP of 565, looks like that one changed from your last update? Yes, I guess we were expecting that average to maybe improve with some of the enhancements and completions that you were just talking about Peter. Can you expand on that may be a little bit we expect that --?

Yes. Again it's -- Chad it's all part of the process that we're going through. It was a simplification of us to put out initially just one EUR for the Miss Lime. And what we're finding now as we go on into it and understand it a lot, lot better we're seeing a whole variation of play types and a whole variation in terms of their performance. I do also caution that EURs are to us a very clumsy tool. All you're doing is joining up with dots of your initial production fundamentally so we need for a regression analysis and then drawing a straight line to it and see the volumes you're going to get out of this well over 20 or 30 years. That tool doesn't truly take into account what is the value of the oil and gas being produced here particularly in the early years and we need better tools and better ways of being able to do that and we're trying to develop those. We think 30 days, 60 days, 90 day are very good, surrogates for giving you value even if these wells payout in six, nine months may be a year. So it's that sort of front end stuff that we're spending a lot of time and effort on. And with that in mind when we get to this Analyst Day we'll show you that we've now got a family of curves for what we're calling our Grainstone if you recall when you came in to see us those -- that rock system has got a much higher porosity and has got a much better deliverable of BOE volume in it. We've got altered rock which is rock that has been altered by the cast -- and the cast at some point was exposed in time way back in the carbonate (inaudible) and that's given you in house for porosities and then we've actually got what we call an enhanced area where you again get this cast effect to its performance. So we're seeing variable EURs, we're seeing variable performance and we'll show you the decline curves and the work that we're doing with that and how will the investor tackle it with regards to our completion philosophy and techniques. Does that help? Chad Mabry - MLV & Co.: That's very helpful. I appreciate it. Just one follow-up if I could on LOE and Miss Lime. We're really impressed with their around 450 of BOE last quarter should we expect that to improve on a unit basis, with growth and production or is that kind of a floor level to expect there?

Hey, we're always seeking to get better. But when you get in down to low sorts of numbers it gets tougher and tougher to start lowering it. And it's already pretty impressive and with those sorts of margins the game is to try and sustain them and continue to deliver them. Yes, you try and get better, of course you do. But we're getting down to some pretty low numbers here and what's to say we will improve because we will. They're not going to come in dollar increments anymore because that's not the way it is as you well know. So it's all part of the program here trying to just be much more efficient with the dollar we spend and how we spend it.

I just want to take that.

I would just add that I mean, yes, we are seeing a much consistent approach now and the numbers we're getting out of our 30 days of this 565 is now based on 169 wells which we think is a pretty large population of sample size that shows you that we're getting pretty consistent and we know what we're doing and we're getting solid delivery from these well BOEs, very solid.

And the next question comes from the line of Pearce Hammond of Simmons & Co. Pearce Hammond - Simmons & Co.: Congrats on a great quarter.

Thank you. Pearce Hammond - Simmons & Co.: Peter, as you peer in --

Buy shares, buy shares. Pearce Hammond - Simmons & Co.: Peter, as you peer into 2015 do you think that the activity levels that you have right now as far as the split on the rigs between the Anadarko Basin and the Miss Lime Basin will be maintained into 2015?

Good question. The jurist as far as I'm concerned and the guys are concerned we know the rules, we've got dollars in our hands, they're very scare dollars, and we're going to spend them as wisely and as best we can to get the best return on that dollar that we think is awesome. We will balance with a bit of strategic thinking such that we bring on our other play systems and the Anadarko is no question has got ways to go to get itself to perform to the level that we got in this line performing today. That's not to say, it can't do it, it can. And if we do start to see those improvements then we will put capital to them and there was always going to be a need to make sure that we are developing our portfolio in a way that is consistent with our investment requirements. Nelson here is going to beat me up every time we try and spend dollars, because he wants to see a solid return as he can such that our balance sheet and our planning and thoughts go to sustaining and growing the value. Pearce Hammond - Simmons & Co.: Thank you for that. And then my follow-up on a potential monetization of your saltwater disposable assets what you see as the challenges getting something like that done?

Several. Firstly, I'm delighted that the guys we've all worked together here to isolated and show that there is a business tremendous value in this particular space and other things we to. I mean, we should never forget, we produce a lot more water than we do oil and with primarily in the water business and water management business than we are on the oil and gas business. So it becomes hugely important and regrettably we have ignored it a bit, the industry has ignored it to a bit, and now what we we're starting to do is address that. We have spent very wisely in getting those LOE cost down such that what we have now got is over 100 miles of pipe work all intact. We have got six very solid water disposal wells with another two that could be linked in very easily and that gives us a huge capacity to 140,000 odd barrels of water a day of handling. And today we run through about 140,000 to 170,000 barrels of water a day. That is a pretty chunky piece of business. And if you consider that if someone landed from Mars in the middle of our Miss Lime position and have to pay a bill for produced water he would be paying somewhere between $0.50 and $1 for the pleasure of doing it. Well you rank that through the numbers you get some pretty chunky sizable valuations here that are available to us. You then look at that and we've done those sums and we know what it's worth. What we then do is say okay what structured impediments that we got in terms of ownership, in terms of ability to be tax efficient, and the ability to bring in sustainable partners that know what they're doing and know this business. We are in the process of doing that and we were speaking to some very savvy folk that know this business and we are working with them to put a collective efficient structure together that make sense and works. It's a very important part of our realization of value and it's part and parcel of our business. Pearce Hammond - Simmons & Co.: Well, thank you very much, Peter.

Watch the space I think is the answer.

Your next question comes from John Herrlin with Societe Generale.

Yes, hi. With respect to value creation I was wondering if you have data rooms open on the Anadarko or your water system and how you're kind of dual tracking all these processes?

We have processes in place for all of those. Yes, we have made the information available under confidentiality to a number of parties to look at water, to look at particular assets and so to look at particular ways in which we combine to bring our business moving. Normal course of business is what everyone does and we are no different and we got about it in a very sophisticated orchestrated organized way.

Okay. With respect to Anadarko Basins, the resource potential seemed a little wide is that because you have to do more G&G work?

I wouldn't put it light, but it's lower relative to the Miss Lime because we understand the Miss Lime a lot better and it's further on. We will get better at it. There is no question. And when you start seeing the other parties that are out there chasing around the Cleveland, the Marmaton, Cottage Grove, Tonkawa and others, the Anadarko has been a very prolific basin will continue to do so. And our numbers will grow as we understand it better and we start to fill our position and develop our programs.

And your next question comes from Kyle Rhodes from RBC.

Just want to know what kind of EBITDA your saltwater disposal business have had, if you can break it out separately in 2014?

Very good question. If you get $0.50 to $1 on a produced barrel and you have got 170,000 barrels of your own and you have got capacity for third party of another 200,000 odd, I think you can do that sum yourself, you can work it out. Maintenance capital is a small number and it shows you what this thing generates and what it is potentially worth. We are talking to a number of players and it would be inappropriate for me to say anything further than that.

Got it. Is it important for you guys to maintain controls of this asset or is that something you would consider selling outright?

There is a price for everything, but in our mind this is such an important part of our business and water management is huge because it's 80% of our production is water. It's very important that if we're going to retain our identity then we maintain control and influence over it and we will do that.

And your next question comes from Sean Sneeden with Oppenheimer. Sean Sneeden - Oppenheimer & Co.: Nelson, maybe for you on the LOE side. I mean, obviously you have highlighted that its great progress in the Miss, can you help me understand is that mainly due to increasing volumes there or is that have you been able to take out actual costs, right in that at all especially on a sequential basis?

Hi, Sean, it's a combination of the two. It's partly due to the production growth and the big uptick we had quarter-over-quarter and we have also continue to benefit from the savings in electricity by tying into the local grid as opposed to generating to itself and we are continuing to realize some benefit from that. Sean Sneeden - Oppenheimer & Co.: Okay. That's helpful. And then maybe along the same line can you just remind me what the Anadarko LEOs are is it still kind of the $8.5 a barrels of range?

Yes, that would the proxy code. It's in that range. Sean Sneeden - Oppenheimer & Co.: Okay. And just maybe one quick follow up there. On your cash flow and (inaudible) 16, should I interpret that as the delay from the second half that you have kind of spoken about last time second half of '15, I think?

No, I wouldn't interpret it like that. The goal has been to reach that point in early 2016 which would mean we would be coalescing to that breakeven point at the end of next year. So I think that's pretty consistent with the message we are trying to give to everybody and it's consistent with the notion that we have the liquidity through the end of next year which is really the best part through which we need to maintain it. Sean Sneeden - Oppenheimer & Co.: Okay. So I'm hearing you correctly, you are still anticipating (inaudible) cash flow within the first half of '15 and you would see some amount of improvement within the second half, right?

Right, those gaps will continue to close based on what we believe will occur throughout this year and the remainder of next year as well. Sean Sneeden - Oppenheimer & Co.: Okay. And it doesn't include any asset sales or additional JVs and what you have already announced, right?

That's correct.

And your next question comes from Don Crist with Johnson Rice.

Peter, it's been a while since a lot of us looked at the Fleetwood and this deal caught us all by a positive surprise. Can you walk us through I know you have identified 12 different prospects on in the Fleetwood survey over the 200 sq miles, but can you walk us through how much more outside that maybe? I know you could work it on it kind of early in the process.

Sure, we are very happy. I mean PetroQuest have come in; I'm very excited, very proficient operator, well renowned, know the area well. We saw these Matt, and Greg and his guys Matt, a bunch of prospectively here when we were the operator and they took them on and have embraced them. The whole issue is one of preference and allocation of capital. That doesn't diminish the potential of the fleet but far from it. So that the reason for doing the deal made huge sense and it doesn't take away from any of it. They are going to drill two wells in the next couple of months October, November with their first wells added and they will learn awful lot. One of them is predominantly a major oil chest and the other one then is go down for the Wilcox and take a good look at this gas condensate and there are some follow up structures to that which are really quite large, I mean you are talking a half of TCF, we have 500 BCF stuff and which if they can be made to work which they have shown to work as you go into the offshore then there is no reason why they shouldn't work well in the onshore. They come on at very prolific rates. They are expensive wells, but nevertheless they are wells that can be hugely prolific in the event that can be brought on and tamed and brought on line. So we are pretty excited by the whole thing and we can see a good lineup of 10, 12 prospects that are worthy of attention and will be hugely derisked in the event of any success in those early wells that PetroQuest are going to draw.

Okay. And just the follow up to that. How much more acreage is available in and around that the prospects that you have identified to maybe grow this position?

It's pretty well leased up as far as I understand it and we think what is the headline and highlight of the leased area. So we are very comfortable of the structures that we have identified from the regional seismic that we have got it pretty well lit.

Okay. Everything else has been asked. Thanks, Peter.

Pleasure.

(Operator Instructions) Your next question comes from Jamaal Dardar with Tudor Pickering Holt.

Just wanted to ask about the production history you guys are seeing on the down space Mississippi Lime wells and the prospectivity of that throughout your position?

Yes, good question. The premise start out if you layout every well we have drilled in the timeframe and start with every well and then just work through time to today, you see no drop in reservoir or well performance. That's telling you something because a lot of those wells are second, third, even fourth wells in a section. So that starts to make you think. You then go to three wells that we initially looked up and those sections have wells and you look at every single one of those wells in terms of their production history both from a pressure point of view and a production point of view and through their ESPs and relative histories. And you find that every well that we have drilled whenever we drilled into it was 13 pressure, 2300 to 2500 PSI. That tells you something as well. And it didn't matter whether you would drill in second well, third well, or even fourth well. So we were saying to ourselves that there is something going on here. So what we did we started doing some real principal elements and analysis that looked in our geology and geo physics, looked in our petro physics, looked in our cat pressure data, looked in our static reservoir modeling, looked in our dynamic modeling and looked in our field surveillance and the overall performance. And however, we did this we could not see any reason to believe anything other than the 1320 spacing that we currently got would not support a down space into 660. And that's the program we are on right now and we have got four or five sections that we have got wells that are testing that down space in philosophy. Early results are very encouraging and we are seeing no interference whatsoever from a pressure point of view or a production point of view in the wells that we have drilled to-date, which means we have got lot of learning to do and a lot of understanding to do on how these reservoirs and how the Miss Lime is performing. And a bit like you see in the Bakken, a bit like you have seen in the Eagle Ford and in the Permian we are starting to see that that these unconventional reservoirs as they're called although the Miss Lime actually is a conventional reservoir, is made up of many, many complex tracks that were finding better ways to drain. The major drive mechanism is solution gas drive and that means that then you were starting to see efficiencies of perhaps 20% maybe 30% recovery back to potential. And we are not seeing any pressure or production interference as the results of the wells we drilled today working from 1320 down to 660, pretty encouraging stuff.

Our next question comes from Sean Sneeden with Oppenheimer. Sean Sneeden - Oppenheimer & Co.: Hi. Thanks for taking my follow-up. Peter, just one question on opportunities that you discussed in your prepared remarks. Just so I want to make sure I understand what you are exactly referring to on the 900 Miss locations. Is that only from one zone or maybe you could talk a little bit about what all that (inaudible)?

It's what we call the Upper Miss. If you go to our presentation materials, and I don't know what page it is but it is one of them. It shows you that idealized cross section that looks at 3D seismic and talks about grain stone, it talks about enhanced, it talks about altered. What we are talking about is the whole Upper Miss interval where we can see potential that includes down-spacing, includes multiple layers of higher porosities, it includes the enhanced porosity as a results of the weathering of the unconformity surface and includes the high altered where subsequent events, diogenetics[ph] on the rest of it given enhanced porosities. And that combination, we think we can see 900 locations across our acreage suite. Sean Sneeden - Oppenheimer & Co.: Okay. And that's helpful. And so, if I am understanding it correctly, it doesn't include the Lower Miss or Middle Miss that you intend to sell, right?

No. Sean Sneeden - Oppenheimer & Co.: Right?

Correct. Sean Sneeden - Oppenheimer & Co.: Okay. And then, same thing in the Anadarko, is that just from one zone or is that kind of across (inaudible)?

That's a bit different. The Tonkawa, where you see the sand system that we can see being pretty thickly developed, same with the Cottage Grove, the Marmaton changes its name to Hepler in places. There are more discreet solid sand bodies that you have to map around in a more regional sense to get where those rock systems are and where the porosity is better developed, somewhat different. It's not a limestone, you're talking sand stones in the Anadarko. Sean Sneeden - Oppenheimer & Co.: Okay. I may follow-up with you guys later on. And thank you.

Yes, sure. And I'll surly stay for you. And that's what the work we've done is to go through that through that enhancement process and the benefit of having 3D vertical well histories, very solid geoscience and some geophysics integrated with drilling engineers, completions and the way we'd (inaudible) steer give us a lot more potential and lot of consistency and allow us to tack whack first 80 to 100 feet underneath the Miss unconformity. In particular, that allow us then to start seeing an awful lot of rock storage and awful lot of oil that is held in place in that rock system. Pretty exciting stuff.

Okay. At this time, there are no questions. I will now turn the call back to Al Petrie for further remark.

Thank you, Cathy. And thank you everyone for joining us. We look forward to see you in several conferences during this quarter. And feel free to call us with any follow-up questions.

Thanks very much guys.

Thank you. This concludes today's conference call. You may now disconnect.