Good day, ladies and gentlemen, and welcome to the Black Hills Corporation 2013 Second Quarter Earnings Conference Call. My name is Glenn, and I will be your coordinator for today. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes. I would now like to turn the presentation over to Mr. Jerome Nichols, Director of Investor Relations of Black Hills Corporation. Please proceed, sir.

Thank you, Glenn. Good morning, everyone, and welcome to the Black Hills Corporation 2013 Second Quarter Earnings Call. With me today are David Emery, Chairman, President and Chief Executive Officer; and Tony Cleberg, Executive Vice President and Chief Financial Officer. Before I turn over the call, I need to remind you that during the course of this call, some of the comments we make may contain forward-looking statements as defined by the Securities and Exchange Commission, and there are a number of uncertainties inherent in such comments. Although we believe that our expectations and beliefs are based on reasonable assumptions, actual results may differ materially. We direct you to our earnings release, Slide 2 of the Investor Presentation on our website, and our most recent Form 10-K and Form 10-Q filed with the Securities and Exchange Commission for a list of some of the factors that could cause future results to differ materially from our expectations. I will now turn the call over to David Emery.

Thank you, Jerome. Good morning. Good morning, everybody. I'll start on Slide 3 of the webcast presentation for those of you who are following along. Our agenda today will be very similar to the format we've had in previous quarters. I'll give an update on key activities in the quarter. Tony will cover financials for the quarter, and then I'll discuss strategy and forward-looking issues. Moving to Slide 5, highlights of the second quarter. From a business standpoint, we had colder weather than normal in our gas utility service territories, quite a bit colder, about 20% colder than normal from a heating degree days and at a standpoint of about 70% -- 72% more heating degree days than last year during the same period. If you recall, last year, we had an extremely mild spring. Highlights for the utilities. Construction on our Cheyenne Prairie Generating Station is on schedule and within budget. That project is going very well. At Colorado Electric, we filed a resource plan in April. We discussed that on the last call. But in that plan, we identified a 40-megawatt gas turbine as the replacement for the 42-megawatt Clark power plant, which is a coal-fired plant that has been retired. We also recommended retirement of a couple of small gas-fired units in Pueblo for a total of 29 megawatts. And then we filed certificates of public convenience and necessity, seeking approval for the new turbine and the retirement of both of those 2 smaller gas-fired units. We do have a hearing date set for November regarding the resource plan and the CPCNs and hope to receive approval, so we can start work on that turbine project. Also at Colorado Electric, we issued a request for proposals for up to 30 megawatts of wind in April. We have…

Thank you, Dave. Good morning. As Dave mentioned, second quarter performance continued to show strength from 2012. Moving to Slide 12. We reconcile our earnings from continuing operations on a GAAP basis to earnings per share as adjusted, which is a non-GAAP measure. We do this each quarter and feel by isolating special items, the earnings per share as adjusted better communicates our most relevant ongoing performance. During second quarter of 2013, we have one special item, which was the reduction of a $0.28 noncash mark-to-market gain on our $250 million worth of interest rate swaps. The gain reflected an increase in long-term interest rates during the quarter. So considering this special item, the second quarter's earnings per share as adjusted from continuing operations was $0.41 compared to $0.34, a 21% increase. Also, I'd like to point out that our trailing 4 quarters EPS as adjusted was $2.38, and this is an improvement of 32% over the comparable fourth quarters ending June 30, 2012. Slide 13 displays our second quarter revenue and operating income. Later, I'll explain major differences between years. But here, the main point is we're predominantly a regulated business, generating 86% of our operating income from electric and gas utilities in the second quarter. Our operating income improved by $1.5 million compared to 2012, driven by improvements in Power Generation, Coal Mining -- and the Coal Mining segments. Utilities in total were flat year-over-year, with improved performance in the gas LDCs, offset by lower electric utility performance. I'll give more color on the operating income changes on a later slide. Slide 14 displays our second quarter income statement. On later slides, I'll discuss the segment revenue and operating income in more detail, but here, I want to mention several other noteworthy items that impacted the second quarter…

Thank you, Tony. Moving on to Slide 22. We have 5 major strategic objectives, really focused primarily on being an industry leader in everything we do. We want to be a leader in operational performance, earnings growth, our earnings upside opportunities primarily provided by our oil and gas properties, and our track record of 43 consecutive annual dividend increases. We also want to continue improving our credit rating, and we've made great progress in that regard. Moving on to Slide 23, related to operating performance. There are several metrics on here. All exhibit exceptional performance relative to our peers in the areas of safety, reliability and several other efficiency measures. On Slide 24, this illustrates our superior plant availability and starting reliability. It also demonstrates that we have an extremely modern generation fleet, as you can see by the fleet age there, and that our power plant construction safety record is great. We've provided an update on that chart with 0 accidents to date on our Cheyenne Prairie Generating Station. Slide 25 sets on our generation by fuel type but further illustrates the recent and ongoing modernization of our generation fleet. When we look at the impositions of new government regulations, from a customer impact perspective, we're essentially through the majority of that impact once we complete the Cheyenne Prairie Station. So our fleet's very modern and won't require a lot of additional modifications. On Slide 26, from an earnings growth standpoint, we expect continued strong earnings growth driven by capital spending. That spending will be done to meet customer needs in our utilities and also to grow our nonregulated energy businesses. Now for the next several years, capital spending is projected to continue to be far in excess of our depreciation. Slide 27 simply provides more detail regarding both…

[Operator Instructions] And your first question comes from the line of Kevin Cole with Crédit Suisse. Kevin Cole - Crédit Suisse AG, Research Division: I'll start with the Mancos today, some on the 2 tests wells. Are you expecting reserves in line with the 68 Bcf that you realized in the past or highlighted on Slide 31 as well?

Yes. From a reserve perspective, Kevin, we're not comfortable disclosing anything based on the terms of our confidentiality agreement. I would say the drilling and everything have gone very much according to plan to date. But beyond that, I'm really not comfortable commenting on specifics, reserves or anything else. Kevin Cole - Crédit Suisse AG, Research Division: Have you provided the idea, the well technology, like the expected length of the lateral and the number of frac stages that you're going to use?

We have not. Kevin Cole - Crédit Suisse AG, Research Division: Okay. And then, I guess, back to your -- to the original 74,000 acres, what is the status of the BLM approval to allow you to start drilling wells there as well?

Yes. We have 6 permits that have been approved. Two are what we would consider to be ready now. Four of them have conditions of approval, which we felt were overly onerous. In a nutshell, basically, they're requiring us or trying to require us to do a whole bunch of environmental studies, which are well beyond the scope of the drilling activity we're proposing. And so we're working with the BLM, really trying to get a couple of those conditions removed. We could drill the wells and cooperate with those conditions, but I think they're a very large overreach by the BLM. And so we're trying to be careful about how we proceed with those but don't feel that some of those studies are necessary. So we're visiting with them to try to see what we can work out for an arrangement between us. We are in the process of filing several more permits. And really, the intent is to have around 18 permits available by next spring in the Piceance Basin. Kevin Cole - Crédit Suisse AG, Research Division: Okay. And I guess, sorry, to what you said, there's 2 permits that could be ready to go?

Yes. Kevin Cole - Crédit Suisse AG, Research Division: Are you willing to -- are you expecting to drill those this year as well?

We have not made a decision to do that yet, probably will not. Kevin Cole - Crédit Suisse AG, Research Division: Okay. From -- I guess, from where you sit today, are those 2 wells, those locations looking to be kind of in line with what we saw in 2011? Or you're thinking they're maybe like more prolific or...

Well, I think the issue that's going to affect productivity and reserves really comes down to lateral length and frac stages, in your earlier question. I think we would anticipate drilling these next wells that we drill with longer laterals, probably 8,000 or 9,000 feet instead of a 4,000 to 5,000 that we drilled in late 2011. And 30 to 40 frac stages instead of 20-ish like we did last time and would expect a proportionate increase in reserves associated with that. We have not finalized our specific well procedures for those wells yet. We just got the permits, and we're not prepared to drill those yet. But I would expect we'd have a little bit different procedure than the last time. Kevin Cole - Crédit Suisse AG, Research Division: That's great. And then, sorry, one last question then, onward the general play, I saw the general Mancos, where are we at in determining the proper acre spacing from 160 to 80 to eventually 40?

Yes, good question. Some of the offset operators are continuing to talk about their results, and in particular, I think you might want to review some of WPX's public information. They don't disclose specifically what they say they're anticipating spacing or anticipated spacing is, but if you look at their resource recovery per acre, it's significantly higher than what we're disclosing. So I can't specifically answer what others are thinking about spacing other than to say it's the same rock basically. So they're projecting a lot higher reserves per spacing unit or per acre than they have to be looking at reduced spacing that's quite a bit tighter than what we're showing currently. WPX has some good information on that, that could answer some of your questions. Kevin Cole - Crédit Suisse AG, Research Division: Sorry, one last E&P question. On one of your last E&P slides, you indicated that you're in the process of looking to acquire more oil property?

Yes, not so much acquire, but in a more -- maybe acquire some leasehold and drill some prospects. Powder River Basin, in particular, is a very mature oil basin, and that still has some good opportunity left, particularly in the oil price ranges $80, $100. And so we're looking at those, and there is a chance we may drill up to 3 wells yet this year in the Powder River Basin.

And your next question comes from the line of Chris Ellinghaus with Williams Capital.

Do you feel that this quarter is indicative of where you're headed in terms of your coal run rate?

I would say it pretty much met expectations. There wasn't anything unusual in the quarter.

Please, let me rephrase that. Do you feel like you've completed the ramp-up of the sort of turnaround and the improvement in margins?

Chris, the improvement that we saw this quarter, we're probably not going to see that kind of improvement consistently. So this was a big step function this quarter. We were up $1.8 million on operating income, but we hope to continue to get a little bit of improvement out of that.

We'll keep focusing on efficiencies, but all of our staff reductions and production levels and all of those things are largely completed.

Okay. And given the quarter for oils -- for EMP's performance, have you got any update on your thinking about how negative EMP can be sort of on a continuing basis?

Not really. I think if you look at EMP's results, they're not really different from what our expectations were and continued results from E&P in that range are included in our guidance range, if that answers your questions.

Okay. On a corporate level, should we be seeing sort of, on a whole, the corporate drag slightly increasing over time, as you complete -- you go through the construction phase on Cheyenne Prairie?

I don't think so, Chris. The big improvement in corporate line this year is really the interest expense reduction.

Right. So I'm just thinking as you go through the construction phase on Cheyenne Prairie that interest expense will start to run up a little bit more.

It probably will, but most of it should be recoverable. So the interest expense will increase but the way the writers work is it should show up in operating income.

And assuming that South Dakota approves a rider?

Yes, that's our assumption.

[Operator Instructions] At this time, we have no further questions, and I would now like to turn the call over to David Emery for closing remarks.

All right. Thank you. Thanks for attending the call this morning, everyone. We appreciate your continued support and your interest in Black Hills. Enjoy your day. Thank you.

Ladies and gentlemen, that concludes today's conference. Thank you for your participation. You may now disconnect, and have a great day.