Good morning. My name is Andrew, and I will be your conference operator today. At this time, I'd like to welcome everyone to the SandRidge Energy Second Quarter 2018 Earnings Conference Call. [Operator Instructions] Thank you. Johna Robinson, you may begin your conference.

Thank you, Operator, and welcome everyone to the conference call. With me today are Bill Griffin, President and Chief Executive Officer; Mike Johnson, Chief Financial Officer and John Suter, Chief Operating Officer. We would like to remind you that in conjunction with our earnings release and conference call, we have posted slides to our website under the Investor Relations tab that we'll be referencing during the call. Keep in mind today's call contains forward-looking statements and assumptions which are subject to risk and uncertainty, and actual results may differ materially from those projected in these forward-looking statements. We will also make reference to adjusted G&A, and other non-GAAP financial measures. Reconciliations of these measures can be found on our website. Finally, you will see us file our 10-Q later this afternoon. Now, let me turn the call over to Bill.

Thank you, Johna and good morning everyone. I appreciate you taking time today to join us for this review of SandRidge Energy 2018 second quarter performance results and our go-forward outlook. Today’s conversation we’ll be referencing the second quarter investor presentation posted on our website earlier this morning and I encourage you to utilize that for today’s discussion. As Johna mentioned, joining me are Mike Johnson, our Chief Financial Officer who will be speaking to our financial results and John Suter, our Chief Operating Officer who will be providing enough data on operations later in the call. If you will please turn to slide three, as most of you are aware there have been a number of changes at SandRidge since our last call. Most significantly was the election of a new board of directors. Additionally, we have some exciting new well results in North Park that should have a meaningful immediate impact on the value of the company along with the NorthWest STACK where our drilling program is providing increased confidence in our geological model and the ability to identify the best undrilled opportunities across our acreage position in this play. The new board took control after our annual meeting in June and has hit the ground running with numerous meetings and initiating a deep dive into all aspects of the organization. Some of these include a comprehensive assessment and understanding of the existing asset base and associated reserve development plan. The current strategic alternatives process and the evaluation of appropriate strategies to maximize shareholder value. I know all of you are interested in the status of our ongoing process to solicit and review strategic options to the company’s evolving plan for growth and value creation. This is a broad process that incorporates numerous possible outcomes that could create…

Thank you, Bill, and good morning to everybody on the call. The employees of Sandridge delivered key operating results that exceeded our expectations and are setting the stage for what we believe will be significant value creation in the future. Our second quarter results reflect, among other things, considerable reductions to our production expenses and adjusted or cash G&A which has enabled the company to reduce combined cash cost guidance for 2018 by 8 million at the midpoint. This over performance was achieved at a time when significant effort and financial costs were incurred in connection with a proxy contest that also resulted in the acceleration of the majority of outstanding share and incentive-based compensation awards. In addition, as Bill mentioned, we experienced declining production and lower natural gas price realizations at a time when we had a significant portion of our second quarter liquids production hedged at WTI oil price of roughly $55 a barrel, leading to a net realized hedging loss of $11 million during the quarter. In spite of the these obstacles, our second quarter results reflect encouraging trends that shouldn't be overshadowed by these charges. We believe Sandridge is now poised to maximize the value of our existing asset base and John will provide much more color on our operational outlook as part of his remarks in just a moment. Slide five of our investor presentation offers a recap of our financial highlights and key cost reductions during the period. In the second quarter, our production expenses and adjusted G&A all came in at/or under budget and both of these cost categories are down considerably year-over-year and sequentially compared to the first quarter. With respect to LOE, the recent and projected cost reductions are being seen primarily in both our Permian and Mid-Continent assets and reflect…

Thanks Mike. If you’ll turn with me to slide six, you’ll see we have several operational highlights to touch on. I’ll cover them briefly, then go in more detail shortly. First in North Park, we’re making good progress on this year's objectives. Subsequent to the quarter, we have some exciting new well results from two different spacing tests on the east and west sides of our core area. Wells from both test targeted multiple benches and initial production results exceed our expectations. Current field production has ramped to over 6000 barrels of oil per day, which is over twice the average first half 2018 oil rate. We released our drilling rig in April as planned to evaluate results from the first of six western spacing test wells scheduled this year. We plan to deploy a rig in late Q3 to further advance tests that will optimize spacing patterns for future field expansion. In addition, we’ll further delineate the less developed southern area of this asset. Finally, we’ll initiate the midstream partner selection process. Our chosen partner will execute planned gas and oil takeaway projects. I’ll provide more color on these initiatives in coming slides. In Mid-Con, our NorthWest STACK asset continues to utilize one drilling rig under the drilling participation agreement. So far, we drilled eight wells this year under this arrangement. We continue to focus on delineating this asset while improving our drilling and completion practices for future expanded development. In the Miss [ph] we’re using one rig to drill the first of four higher return projects. Now on slide seven, let's zoom in on North Park specifically. Well density and delineation efforts make up more than half of our spend from drilling and completion activities during the year. Non VNC [ph] is made up primarily of Central facilities,…

Thanks, John. In summary, this was a challenging quarter, but one in which meaningful progress was achieved. Since early in the year we've navigated significant change in the company senior leadership team, organizational structure and subsequently with our Board of Directors. We continue to listen and strive to be responsive to our shareholders. This organization remains focused on continuous improvement and solid operational performance while working in parallel to assess all strategic alternatives. Our commitment remains unchanged to create value for our shareholders. It's important not to lose sight of the opportunity that presents itself with SandRidge. First and foremost is that we have an incredible platform for growth not only do we have a clean capital structure but as of August 2 we had $436 million of liquidity. This provides tremendous optionality as we assess a multitude of options going forward. Second, unlocking this incremental values within our control and capacity, we have a mature HBP Miss Lime asset generating significant cash flow to fund development of a meaningful inventory of future wells in the North Park basin and the NorthWest STACK, while we grow operating income and oil as a percentage of our product mix in these areas, we expect to extend our Miss Lime cash flow generation through extended expense reductions and targeted capital investments. We've demonstrated capabilities and competencies that are aligned with asset base. Additionally, we've taken major steps toward restructuring the company's cost structure and positioning the organization to efficiently and effectively execute our development program. SandRidge is attractively valued relative to most standard industry evaluation metrics, while this is partially attributable to some individual perceptions of our various operating areas, we believe these views are misguided and remain dedicated to changing those impressions through delivery of tangible results. I'm confident that continued success through the drill bit further reductions in cash cost and demonstrated profitable growth in production and EBITDA will be the catalyst for this change. We remain focused on execution, returns, margin improvements and value creation for the enterprise. I appreciate your time today and we'll now turn it back to the operator for questions.

[Operator Instructions] Our first question comes from the line of Lin Yang with FM Capital. Your line is open.

Hello. Good morning. Two questions please. First of all, any potential impact you can see from the current political environment in Colorado. Although you're in rural areas, not supposed to be impacted by the [Indiscernible] movement, for example, but any potential spillover effects, for example, drilling permitting process?

Yes. This is John. I don't think we have any issue to-date. We work with the regulatory authorities, try to keep up with various rule making and haven’t had issues or concerns from them to this point, where we sit in Jackson County.

Great. Second question is, any potential tax assets you have that may be offsetting some capital gains tax, if you were to sell any asset, for example, North Park asset for higher value than the company acquired back in 2015 – 2016?

Yes. We have substantial net operating loss carry forward. Those are more carefully outlined in our 10-Q that we're going to file this afternoon, but we do have substantial remaining tax attributes available for any series of transactions that we might undertake.

Okay. Fantastic. Thank you very much.

[Operator Instructions] Our next question comes from the line of Bill Dezellem with Tieton Capital Management. Your line is open.

Thank you. I have a group of questions. First of all, would you please share with us relative to the North Park assets, the production coming on line on those new wells above expectations? What you think is the primary driver behind that?

Well, Bill, there are multiple things going on out there as we've started to evolve and walk down the learning curve in the North Park and in particular with the Niobrara. As John mentioned one of the key drivers here is the continued evolution of our completion techniques and how we complete these wells. We think that certainly important. The second piece is somewhat a function of the rock itself. We've continued to evolve on where we land these laterals and target specific intervals and I think that's been particularly effective as well.

And then you started thinking about decline rates on those wells, I guess, let me ask two questions, first of all, what would be your initial expectation before you saw the success of these wells and what the decline rate would be? And then secondarily does this higher level of success impacted decline rates one way or another?

Well, it is early time and it's difficult to tell. But I would point you back to the fact that there have been wells drilled in this particular area and have been producing for a number of years which were the initial basis for our type curve. As we started applying new generations of completion techniques after acquiring this acreage position, we started seeing additional uplift associated with those techniques. And therefore I believe it was last year at some point in time we increased our type curve. As John demonstrated with the type curve that we have out there now, these current wells are even outperforming our uplifted type curve. But it is early times, so it's difficult to predict. But in general my expectation is as we sit here today is incremental IP will ultimately yield more reserves. How the decline looks initially, is still somewhat unknown, but we had real good wells out here even for prior to this quarter and all-in-all they continue to follow our type curve projections.

And the type curve projection would put you at what sort of a decline after one and two years?

Let me pull back to that that particular slide, but I'll let you – we'll have to get back with you on that particular question. I can't tell you what the decline rate is in two years, but if you would look at that type curve graph on slide 12, I think you can get some kind of general feel for the level of decline as we enter the second year there.

My apologies. That's right, it is right there. Thank you. And then my last question is you have enough different things happening between here in the Miss Lime and the other assets that – I'm hoping you can share with us what you expect the increase in production to be from the wells that were completed in Q2 or post Q2. And then you still have a group of wells that would I guess fall under this still to be completed or ducts [ph]. I'm trying to grasp just the incremental uplift you anticipate versus the second quarter production as reported from those wells, one that have been completed and the ducts?

If I follow the question, you're trying to get a clear line of sight on the second half of the year and how much incremental production would be associated with the wells yet to be completed as of the end of quarter. And I believe we're talking in reference to the total company with that question. I would just point you to the fact that we're going to continue to do that. We -- I can't – what I would point you to is the guidance that we've provided for the year is probably being the best indicator that -- as to doing the math to what second half production performance projections will be.

Thank you.

Thank you.

There are no further questions at this time. I'll now turn the call back over to Mr. Griffin.

Thank you again for joining today's call. And we look forward to providing new updates in the near future on our strategic alternatives process along with results and outcomes of the current activities discussed today. Appreciate your interest and please give us a call with any further questions. Thank you.

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