Vitesse (VTS) 17th Annual Southwest IDEAS Conference summary

Business overview and strategy

• Focuses on non-operated participation in wells, mainly in North Dakota's Bakken Play, with some exposure in Colorado's DJ Basin.

• Maintains over 50,000 net acres and consistently pursues acquisitions, adjusting capital spending based on market conditions.

• Prioritizes a dividend yield above 10%, with capital allocation decisions centered on sustaining this payout.

• Leverages technological advancements, such as longer laterals and improved drilling efficiency, to enhance returns.

• Utilizes a robust data system and AI to inform investment and operational decisions.

Capital allocation and financial discipline

• Dividend maintenance is the top priority, with flexibility to reduce capital spending or acquisitions to protect it.

• Maintains a strong balance sheet, targeting leverage below 1x, with willingness to temporarily exceed for strategic acquisitions.

• Production averages 17,000–17,500 Boe/d, with a focus on returns and dividend stability over production growth.

• Share buybacks are considered but not executed due to favorable trading levels; debt paydown remains important.

• Capital allocation decisions are made quarterly, adapting to market and operational changes.

Operational and technological developments

• Longer laterals (up to four miles) and optimized well spacing have improved economics and unlocked previously lower-tier acreage.

• Drilling costs per lateral foot have declined 26% (46% inflation-adjusted) since 2014, while production per foot has increased 75%.

• About 50% of new well proposals feature three- or four-mile laterals, with creative drilling techniques like horseshoe laterals emerging.

• AI integration enhances data analysis, supporting all departments and improving decision-making.

• The company remains 80% undeveloped, expecting continued reserve unlocking through innovation.