Travis Stice on US production decline
From Diamondback Energy Inc ($FANG) Q1 2025 Earnings Call · · Castify Earnings Call
“I think as capital continues to come out of the investment equation, this decline that we're on is going to be magnified and you know because we are in the more mature stage of the development this is not one of the types of declines that can be offset you know by improved efficiencies although we highlighted you know continued efficiency gains at the diamondback level in the quarterly results uh but we're picking pennies up now uh and when we were going through this you know earlier in our history you know probably most recently 2014 and early 15 you know we were able to pick up you know uh dimes and quarters back then and it's just it's just uh where we are in the maturation cycle of of uh you know depleting these resources that I think you're going to see you know a really remarkable response um on this base decline that's part of the equation.”
On , Travis Stice, Executive Chairman of the Board at Diamondback Energy, spoke about US production decline during Diamondback Energy Inc ($FANG) Q1 2025 Earnings Call on Castify Earnings Call.
About Travis Stice
On Diamondback Energy's Q1 2025 earnings call, Travis Stice described the current macro environment as "challenging at best," citing OPEC's decision to add a million barrels per day to an oversupplied market. He stated that the "smartest capital allocation decision today is to repurchase shares," recommending 70-75% of free cash flow go to buybacks and the base dividend, with 25-30% allocated to debt reduction. Stice noted that the U.S. marginal barrel is "not being produced today" and that production is "slowing dramatically" and "likely declining," attributing this to geological headwinds outpacing efficiency gains in a maturing basin. He characterized the industry's remaining inventory as "sub-40 break even" and said that "the marginal barrel is being pushed to the right." In a separate podcast appearance, Stice discussed the Permian Basin's potential, stating that "80 to 90% of the oil is still in the ground" after a century of drilling. He credited the shale revolution with providing "America energy independence" and described the Permian Strategic Partnership as "one of the greatest private public partnerships in the history of our country." Stice also encouraged civic engagement, saying that "if you don't choose to engage in our voting process, you're letting other people do that" and that representation should be "seeded... away from the vocal minority."