Range Resources Corporation Q3 FY2025 earnings call

• Range executed its plan safely and efficiently during the quarter, delivering consistent well results, free cash flow, and steady activity levels. All-in capital was $190 million, producing 2.2 Bcf equivalent per day. • Year-to-date capital investment of $491 million is on track with full-year guidance. Operational savings come from returning to pad sites, utilizing existing infrastructure, etc. • In marketing, natural gas saw record LNG exports and expected growth in LNG export capacity. NGLs have growing export capacity with Range leveraging its portfolio for margin enhancement. • Operationally, two horizontal rigs drilled ~262,000 lateral feet, and completions had nearly 10 frac stages per day.

During the third quarter, Range's all-in capital was $190 million, generating production of 2.2 Bcf equivalent per day. Year-to-date, $491 million has been invested in capital, on track with the full-year guidance of $650 million to $680 million. For natural gas, the U.S. exported record volumes of LNG in the quarter, and there's expected growth in LNG export capacity leading to tightening gas market fundamentals. For NGLs, ethane and propane have substantial increases in export capacity, with Range's geographically advantaged access supporting a premium versus the Mont Belvieu index.

• Q4 production is expected to be ~2.3 Bcf equivalent per day, growing to ~2.6 Bcf equivalent per day in 2027. • Full-year guidance for NGLs has been improved due to market dynamics. • Capital investment is on track with the previously revised full-year guidance of $650 million to $680 million.

Q: I wanted to spend some time on the work in progress inventory. Can you speak to what you think that 400,000-foot number looks like at the end of 2026?

A: Dennis Degner discussed that the 2026 program will have a linear utilization trend of inventory, with capital similar to 2025 but with a shift to completion of DUC inventory, and production expected to be ~2.4 Bcf a day then 2.6 by 2027.

Q: I wanted to follow up on 2026 as well. So this year, you're pretty much on track with your plans, and that's great because it's effectively year 1 of 3 as you think about that ramp through 2027. But as you continue here, given your strong execution this year, where do you see upside to your plan?

A: Dennis Degner mentioned upside could come from operational efficiencies in the field, like drilling long laterals and completion efficiencies, and infrastructure utilization with midstream partners.

Q: I wanted to see if you guys could opine on the NGL macro. You had a couple of interesting slides in your deck last night, showing maybe some green shoots on both the propane and the ethane side. So maybe I can simply see the floor and maybe you can tell us what you're seeing in that market for 2026?

A: Alan Engberg said there's strong demand growth for NGLs, with ethane and propane export capacity increasing, and Range's access to European market supporting a premium.

Q: Want to see if I get an update on your conversations you've been having for supply agreements and -- are those limited to Pennsylvania? Or are you discussing anything outside the state and any of those with end users or more like the Imperial type of conversations that you've been having so far?

A: Dennis Degner said focus is primarily within producing region, but there's willingness to talk about expansions outside, with inventory and transport diversification playing roles.

Q: I was wondering if you could provide maybe a little bit more details on what's going on with Liberty and the Imperial Land kind of project in Washington County?

A: Dennis Degner said conversations are fruitful, narrowing down to final end users, with state support and ideal gas supply location.

Q: Just wanted to quickly touch on your kind of thoughts on a couple of issues across the market. So curtailments and production modulation have seen this additional chatter as of late with some of your peers choosing that avenue to kind of address pricing volatilities. I guess how should we think about Range's kind of overall strategy towards that type of modulation or whether it's plus or minus or curtailments or is it more a steady state?

A: Dennis Degner said Range has used strategies like curtailments when warranted and shaping production timing based on pricing signals, with NGL uplift and gas leaving the basin differently affecting the calculus.

Q: I just first wanted to start on the fact that given you are now well within your target net debt range, how are you evaluating allocation of free cash flow between share repurchases, further debt reduction or book marketing cash for potential other investment opportunities?

A: Mark Scucchi said they will continue to do all of the above, with historical trends showing returns of capital increasing as they get within target, balancing growth and returns.

Q: I also just wanted to get your latest thoughts on M&A as it also continued to be a prevalent topical theme in upstream space here, acknowledging that you have significant low-cost inventory depth as you've outlined so far and on Slide 5. Are there any acreage packages potentially available that you believe could be accretive to Range's portfolio?

A: Dennis Degner said there are opportunities for white space acreage around their footprint, with some in state parks and surrounding operating areas.

Q: I did just want to get your thoughts on -- you've commented a lot about your optimism -- excuse me, optimism around NGL markets and obviously in the natural gas markets. Just given the amount of international demand capacity that's coming online, particularly for markets like ethane, should we expect to see that percentage of your portfolio that you're directing internationally to increase?

A: Alan Engberg said the proportion of international business on the LPG side is around 80%, and it will stay similar, with flexibility to optimize between domestic and export markets.