Strategy

Our primary business objective is to increase reserves, production and cash flows at an attractive return on invested capital. Our business strategy is currently focused on developing unconventional oil, condensate, NGL and natural gas reserves from the Eagle Ford Shale. Key elements of our business strategy include:

1.  Actively Develop Our Eagle Ford Positions

Our 2018 capital budget is estimated to be approximately $420 to $470 million, which is focused predominately on the development of our Eagle Ford Shale acreage. As of December 31, 2017, we were producing from 2,165 gross wells and had identified over 3,700 net locations for potential future drilling in our Eagle Ford Shale acreage. In 2018, we plan to invest between $407 and $437 million on development drilling and completion in the Eagle Ford Shale to complete 87 net wells.

2.  Enhance Returns by Focusing on Operational and Cost Efficiencies

We are focused on continuous improvement of our operating measures and have significant experience in successfully converting early-stage resource opportunities into cost-efficient development projects. We believe the magnitude and concentration of our acreage within our core project areas provide us with the opportunity to capture economies of scale, including the ability to drill multiple wells from a single drilling pad, utilizing centralized production and fluid handling facilities and reducing the time and cost of rig mobilization.

3.   Adopt and Employ Leading Drilling and Completion Techniques

We are focused on enhancing our drilling and completion techniques to maximize recovery of reserves. Industry techniques with respect to drilling and completion have significantly evolved over the last several years, resulting in increased initial production rates and recoverable hydrocarbons per well through the implementation of longer laterals and more tightly spaced fracture stimulation stages. We continuously evaluate industry drilling results and monitor the results of other operators to improve our operating practices, and we expect our drilling and completion techniques will continue to evolve and improve.

4.   Maintain Substantial Financial Liquidity and Flexibility

We strive to maintain a high level of liquidity and believe our current liquidity position, along with cash flow from operations, will be sufficient to fund our 2018 capital spending. Additionally, we regularly evaluate our level of drilling activity in light of both actual commodity prices and our ability to influence our costs of operations and adjust our capital program as appropriate. We also periodically review acquisition opportunities, as well as potential divestitures, as part of our ongoing business development initiatives.