The following is a summary of the Diamondback Energy, Inc. (FANG) Q4 2023 Earnings Call Transcript:

Financial Performance:

• Diamondback Energy is projected to generate about $5 billion of free cash flow in 2024 in a $75 world. Half of this, around $2 billion to $2.5 billion, will be used to reduce the cash portion of the purchase price.

• The company aims to reduce total net debt to about $12 billion at the close of 2024 and aims to hit the $10 billion number by the middle of 2025.

• For the long term, Diamondback aims to reach a net debt number of $6 billion to $8 billion, hoping to maintain a real cash balance on the balance sheet.

Business Progress:

• Diamondback Energy has announced a merger with Endeavor. This merger is expected to greatly extend their durable inventory and their conversion efficiency is expected to come to bear on a larger asset base.

• The firm plans to reduce CapEx by 10% while maintaining their volume profile in 2024 using Endeavor Direct Material Cost.

• Capital is being allocated to the best combined resource, with plans to reduce environmental CapEx in coming years.

• Through the merger with Endeavor, Diamondback hopes to improve supply chain operations and is seeking potential upside by integrating best practices across both companies.

More details: Diamondback Energy IR

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