Good morning, and welcome to Genie Energy's First Quarter 2017 Earnings Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation by Genie Energy's management, there will be an opportunity to ask questions. [Operator Instructions] In its presentation, Genie Energy's management team will discuss financial and operational results for the three-month period ended June 30, 2016. Any forward-looking statements made during this conference call, either in the prepared remarks or in the Q&A session, whether general or specific in nature are subject to risks and uncertainties that may cause actual results to differ materially from those which the company anticipates. These risks and uncertainties include, but are not limited to, specific risks and uncertainties discussed in the reports that Genie Energy files periodically with the SEC. Genie Energy assumes no obligation, either to update any forward-looking statements that they have made or may make or to update the factors that may cause actual results to differ materially from those that they forecast. During their remarks, management may make reference to adjusted EBITDA, which is a non-GAAP measure. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. Management believes that Genie Energy's adjusted EBITDA provides useful information to both management and investors by excluding certain expenses that may not be indicative of Genie Energy's or the relevant segment's core operating results. Adjusted EBITDA should be considered in addition to, not as a substitute for, or superior to, gross profit, income or loss from operations, cash flow from operating activities, net income or loss, basic and diluted earnings or loss per share or other measures of liquidity and financial performance prepared in accordance with GAAP. The Genie Energy earnings release including a reconciliation of adjusted EBITDA to net income is available on the Investor Relations page of the Genie Corporation website, www.genie.com. The earnings release has also been filed on the Form 8-K with the SEC. Please note this event is being recorded. I’ll now turn the conference over Mr. Michael Stein, Genie's Energy's Chief Operating Officer and the CEO of Genie Retail Energy. Please go ahead, Mr. Stein.

Thank you, operator. Welcome to Genie Energy's first quarter 2017 earnings call. This morning we will review our operational and financial results for the first three months ended June 30, 2017. I will lead off with an update on operational progress at Genie Retail Energy, then Geoff Rochwarger, Genie Energy's Vice Chairman and CEO of Genie E&P will review OpEx operations in Israel. After Geoff remarks Avi Goldin, our Chief Financial Officer, will discuss the quarter's financial results. At the conclusion of Avi's remarks, we will take your questions. Turning now to Genie Retail energy. This quarter we achieved some exciting milestones and made good progress on two of our most significant priorities, growing our customer base and de-risking our business. During the three months of April, May and June our gross leader additions were nearly 70% more than in the same three months last year acquiring nearly a 100,000 gross new meters compared to 58,000 in the second quarter of 2016. On a net basis during the current quarter our customer base increased by 12,000 net meters and 2,000 RCEs to 430,000 meters and 289,000 RCEs. Last year during the same period our meter base decreased 3,000 meters and 8,000 RCEs. Our successful customer acquisition efforts drove churn in the second quarter up from 5.8% in the year ago quarter and 6.1% in the first quarter to 6.3%, this uptick is to be expected as churn rates are highest among newest customers. And we having enrolled over 180,000 new customers so far, this year. We generated the bulk of our net meter and RCE growth in the new states and utility territories adding through the acquisition of Town Square energy last November even as we continue to open up new utility territories in certain states in which we are…

Thank you, Michael, I'll begin with a brief refresher of Afek's status as of our last update. In early April, we began drilling the sixth well of our exploratory program in northern Israel. Ness 10 is the first well in the northern portion of our license area and is intended to answer two questions. First, does the abundant hydrocarbon source rock identified in all five of the world's drilled south of the Sheik Ali Fault extend through into the North Western portion of our license area; and second, are the subsurface characteristics in the Northern portion of the licensed area including the depth of the resource with associated level of maturation sufficient to have produced fully matured hydrocarbons. Initially we made good progress drilling towards our target depth level of approximately 1,900 meters, however we encountered a very thick layer of heavy and sticky clay at approximately 900 meters. As we start to extract the drilling string [ph] an above ground mine ruptured injuring two of our employees. I'm pleased to report that both men are doing well and are expected to make full recovery. Immediately following the accidents, we suspended drilling to ascertain the cause of the rupture and ensure the safety of our workforce. We then conducted an internal investigation and hired an outside QA and quality control firm to perform an independent review. In parallel the Ministry of Labor initialed an investigation pursuant to regulatory requirements. While this process was ongoing, we redesigned some of our equipment to prevent a recurrence of the rupture. We're now completing the final equipment test and have just received approval from the energy ministry to resume operational and drilling activities on the site. We expect to resume drilling in the next few days. The accident and its aftermath delayed our schedule…

Thank you, Geoff, and thanks to everyone listening and for joining us this morning. My remarks cover our financial results for the second quarter 2017, the three months period ended June 30. Except where indicated otherwise, all comparisons in my remarks attribute to results for the corresponding period in 2016. Consistent with my approach in prior quarters, I will focus on the year-over-year comparisons rather than the sequential comparisons to the first quarter in order to remove from consideration the seasonal fluctuations that characteristic of our retail energy business. While the second quarter is traditionally our weakest quarter, as Michael mentioned this quarter was marked by some significant operational accomplishments. Genie Retail accelerated the growth of its residential customer base and prepared to enter its first international market. In Israel OPEC is about to resume drilling on NES-10 and expects to complete the well as early as in this quarter. In addition to these millstones we reached a primarily settlement of a class action lawsuit that stands at least in part from the Polar Vertex during the winter of '13 and '14. Accordingly, we approved $9 million in the second quarter reflecting our estimate of the settlement cost. We expect a cash will be disbursed in tranches during the first half of 2018. The actual amount to be paid will depend on several factors including the number of customers who claimed settlement payments. This settlement would result the last significant legal claim stemming from the Polar Vertex and bring greater financial certainty to our capital structure and outlook. The accrual reduced revenue in the second quarter by $3.6 million while the remainder of the accruals in SG&A expense. Note that the reduction in revenue will affect gross margin comparisons. Turning now to a financial review of the second quarter. Genie…

We will now begin the Question-and-Answer Session. [Operator Instructions] And our first question comes from Aaron Shafter of Great Mountain Capital Management. Please go ahead.

Couple of questions about Afek and then on the retail energy fronts. Afek you said that you expect the low results now by the close of the third quarter. I'm wondering if you could be more specific than that.

This is Geoff. Because we have not drilled at all for the last two months, resumption drilling will now begin probably in the next week, that will be proceeded by several operational exercises on the site. Not knowing exactly what we are going to encounter, we do know really only allows me to guess at this point [indiscernible] it will be earlier and there are discoveries or findings, we'll obviously alert everybody.

And if there are any more delays, will there be some kind of a [indiscernible]

If there is a blade caused by inventorial issue we will do our best to notify investors.

And from the drilling that you have done in the testing you have done so far does that make you more or less confident?

I remain as optimistic, and confident as I was when we started to drill, what we drilled thus far would not give us any indication whether or not the hydrocarbons are present and if they are what the level maturation is. However, but as I said in my comments what -- the one thing the one very common thing that I did see thus far is that as our pre-site make analysis report drilling showed, we do see additional depths in this well than we've seen in any of the other five wells that we drilled south of the Sheikh-Ali Fault. So, I believe one of the three underlying assumptions that are required for us to find the oil seems to be present, more than that we [indiscernible].

And then on the retail energy front. When do you expect to be able to determine the impact of the New York Supreme Court ruling about the regulatory change and about them to give up these costs.

Hi, thanks for the question, so Michael Stein. So, the ruling is supposed to officially go into around August 26 or 27, that’s when we're supposed to give up the customers that the state is required. I know that there are ongoing appeals on the litigation front that various companies and the industries amounting against the ruling. So, we won't know definitely until those appeals are completely rejected. So, I don’t have a timeline but obviously if its material and it's something that needs to be disclosed we will be disclosing it.

[Operator Instructions] As we have no further questions, this concludes our question-and-answer session and conference call. Thank you for attending today's presentation. You may now disconnect.