Good day and welcome to PEDEVCO's Investor Conference Call to discuss the announcement of its transformative merger transaction where it combined with Juniper Capital's Rockies portfolio to become a premier Rockies-focused operator. At this time, all participants have been placed on a listen-only mode, and the floor will be open for questions and comments after the presentation. Please note that this event is being recorded. I would now like to turn the conference over to Clark Moore, Executive Vice President and General Counsel of PEDEVCO. Please go ahead.
Good morning, everyone, and welcome to our call to discuss PEDEVCO's transformative merger with Juniper Capital's Rockies portfolio companies located regionally within the Rockies. Leading today's call will be our President and CEO, Doug Schick. Supplemental slides are posted in the investor relations section of our website at www.pedevco.com. Today's discussion will include forward-looking remarks based on our current expectations and certain non-GAAP financial measures. Actual results may differ due to factors described in Monday's press release and in our SEC filings. With that, I'll turn the call over to our President and CEO, Doug Schick.
Good morning, and thank you for joining us today. Today, we are announcing a transformative milestone for PEDEVCO Corp., the merger with affiliates of Juniper Capital Advisors to combine high-quality assets in the Northern DJ Basin and Powder River Basins. This transaction meaningfully expands our scale, strength, our production base, and positions the combined company to generate substantial free cash flow while maintaining a strong balance sheet and disciplined capital structure. Merging Juniper's assets with PEDEVCO's creates a compelling strategic opportunity. First, the transaction meaningfully increases scale and diversification. The combined company will immediately control a significant production base, enhancing free cash flow and providing a larger platform for organic growth. Second, the merger is highly accretive.
With near-term production from the Juniper assets and multiple development opportunities in the DJ and Powder River Basins, the transaction is expected to generate significant EBITDA and cash flow contributions in 2025 and beyond. Third, the asset combination allows for operational synergies. PEDEVCO can leverage its disciplined development approach and experience to optimize operations, benefit from efficiencies in drilling and services, and scale activity over time in a capital-efficient manner. Starting on slide four, the combination of PEDEVCO and Juniper Rockies assets creates a leading pure-play operator across the Rocky Mountain region, including the DJ Basins and Powder River Basins, with additional production in the Permian Basin. The combined company controls over 328,000 net acres, of which about 95% is in the Rockies.
The combination creates an oil-weighted portfolio with over 88% of our production being from oil and liquids, and also creates a diversified production base and significant development runway. Our acreage sits alongside top operators such as Chevron, EOG, Oxy, Devon, Civitas, and Continental, offering proven geology and strong well performance. On a combined last 12-month basis for the quarter ending June 30, 2025, which is the last quarter of publicly available reporting, the company's combined production was roughly 8,500 barrels of oil equivalent per day and generated $96 million of EBITDA. The portfolio holds hundreds of drilling locations across multiple stacked formations, primarily in Wyoming's favorable regulatory environment, backed by strong midstream access and low-risk returns. With a leverage ratio of one times the last 12 months' EBITDA and ample liquidity, PEDEVCO is positioned for disciplined development, continued consolidation, and sustainable value creation.
Moving along to slide five, the structure of this transaction is also designed to align interest and create long-term shareholder value. Juniper affiliates and management will receive newly designated Series A convertible preferred stock of PEDEVCO, convertible into 106.5 million shares of common stock, ensuring continued commitment to growth and operational excellence. Upon conversion, Juniper affiliates and management will own 53% of the combined company, with PEDEVCO legacy shareholders retaining 47% ownership. The combined company will retain the PEDEVCO name and continue to trade on the New York Stock Exchange under the ticker symbol PED. In preparation for this transformative combination, PEDEVCO reinforced its balance sheet and secured additional liquidity through a combination of equity and debt financing.
At closing, the company increased its borrowing base under its $250 million reserve-based lending facility with Citibank from $20 million- $120 million, adding three banks to our lending group in the process. At close, we drew $87 million against the facility to help fund the merger. In addition, PEDEVCO has completed a $35 million private placement of preferred shares that, upon conversion, will result in the issuance of 63.6 million shares of PEDEVCO common stock. Participants in this placement included Juniper Capital, former PEDEVCO chairman and majority shareholder Dr. Simon Kukes, and all of PEDEVCO's executive management team. These proceeds have been applied towards the transaction consideration, preserving balance sheet strength and liquidity for future development and acquisitions. Moving on to slide six, the combined management team brings deep operational, technical, and financial expertise across multiple U.S. basins with extensive recent expertise focused on the Rockies.
Joining PEDEVCO's leadership ranks are R.T. Dukes as Chief Operating Officer, Robert Long as Chief Financial Officer, and Ryan Leachman as Vice President of Operations and Development. Together with the existing PEDEVCO executive team, these additions strengthen our operational depth and reinforce our capacity to scale efficiently and responsibly. Moving on to slide seven, the company's combined board of directors will initially include five members: two current PEDEVCO directors, which are myself, Doug Schick, PEDEVCO President and CEO, and John Howie, who is a current PEDEVCO independent director. We will add one Juniper representative, Josh Schmitt, and two new independent directors, Martin Wiltshire and Crystal Franklin, ensuring a majority independent governance board. Upon conversion of the preferred shares into common, the board will expand to six members, with Juniper adding a second representative, Eddie Geiser.
Each director brings over two decades of oil and gas experience, including prior service on public and private company boards. Members of the new board have diverse backgrounds ranging from running public and private oil and gas companies, public and private finance, private equity, and oil and gas engineering backgrounds. This deep experience and strong ownership alignment reinforces our shared focus on disciplined growth, value creation, and maintaining a strong, healthy balance sheet. Moving along to slide eight, the combined company controls a large, high-quality portfolio of assets across the Rockies region, as well as PEDEVCO's legacy Permian asset. Approximately 90% of the combined company's production and over 96% of the company's acreage is in the Rockies region. The company's production base is diversified with high oil content and significant development runway, particularly in the DJ Basin and Powder River Basin.
As stated previously, on a pro forma last 12-month basis for the quarter ending June 30, 2025, which is the last quarter of publicly available reporting, the combined company produced roughly 8,500 barrels of oil equivalent per day, of which approximately 90% was from the Rockies assets. These assets are located in highly attractive concentrated acreage blocks adjacent to major operators, including Chevron, EOG, Oxy, Devon, Continental, and others. The portfolio includes hundreds of delineated locations across multiple stack formations and zones, providing over a decade of low-risk drilling inventory. Existing midstream infrastructure is largely in place, enabling production growth and access to markets. The combined assets represent a platform that is well-positioned to capitalize on the fragmented Rockies operator landscape and lead regional consolidations.
Moving on to slide nine, the combined company's assets span over 314,000 net acres across the DJ and Powder River Basin, more than 90% of which lie in industry-friendly Wyoming, providing a deep inventory of high-quality oil-weighted locations. In the DJ Basin, there is significant future development in legacy PEDEVCO's Wattenberg Extension asset in Weld County, Colorado, where we have 29 non-operated wells of varying working interest in progress coming online in Q4 2025 and Q1 2026, with significant development to scale growth for the next several years. In the Wyoming DJ, we have three 90%+ working interest operated wells in progress in Juniper's legacy Silo Field. The Silo Field and surrounding asset has extensive future development and acquisition opportunities the combined company intends to pursue in the coming years.
The Powder River Basin, where the combined company holds expansive leasehold, adds further running room with increasing offset operator activity expanding proven low-risk zones. Finally, the Permian position, totaling roughly 14,000 net acres, offers a deep inventory of proven drilling locations and significant untapped resource potential, with less than 8% of estimated original oil in place recovered to date. Together, these positions create a diversified oil-rich platform with years of low-risk development ahead. Moving along to slide ten, PEDEVCO is well-positioned as a leading Rockies-focused platform to drive consolidation across the DJ and Powder River Basins. The Rockies region is blanketed with small private and private equity-backed operators that are ripe for consolidation. PEDEVCO, along with help from our financial backers, intends to aggressively attempt to consolidate a large position in the region to form the premier publicly traded Rockies oil and gas company.
Each potential acquisition will be evaluated for strategic fit, accretion to cash flow per share, improved operating metrics, and preservation of a solid credit profile. Moving along to slide 12, turning to the pro forma combined capitalization and liquidity of the company. At last Friday's close, the combined company had approximately $10 million in cash and $87 million in debt drawn on our $120 million borrowing based revolving credit facility. Therefore, the company now has approximately $77 million of net debt and $43 million of liquidity available to fund working capital, near-term development, and future acquisitions. The combined company's credit metrics remain conservative and align with PEDEVCO's historically conservative approach to its capital structure. We anticipate filing our information statement in the coming months that will result in the conversion of preferred into common stock, hopefully before year-end or early Q1 2026.
At that point, PEDEVCO will have a very clean capital structure consisting only of common stock and traditional low-interest bank debt. Moving along to slide 13, PEDEVCO is building for the future with a disciplined return-focused strategy designed to deliver sustainable growth and shareholder value. The company remains committed to operational excellence, continuously improving drilling and production efficiencies to maximize margins while maintaining a lean cost structure and low capital intensity. With a strong balance sheet, robust liquidity, and prudent hedging, PEDEVCO is well-positioned to navigate commodity cycles. Management will continue to allocate capital strategically across high-return organic projects, balance sheet strength, and accretive consolidation opportunities, reinforcing its role as a leading resilient operator in the Rockies. Moving along to slide 14, before we close, I want to reiterate the key highlights that I hope everyone will take away from this call.
First, this combination marks an exciting new chapter for PEDEVCO, and I am confident we have assembled a stellar team to navigate the company going forward. I bring your attention to the following merits of this transaction that make it compelling and value-added. The Juniper assets immediately add production and cash flow to the combined company. Current production on the combined assets exceeds 6,500 barrels of oil equivalent per day, with 32 wells in progress adding additional production growth in Q4 2025 and Q1 2026. Last 12-month combined EBITDA from these assets exceeded $90 million, and Q2 2025 annualized combined EBITDA was approximately $58 million in a stressed oil price environment. These assets hold significant development upside, adding a multi-year runway for organic growth.
By combining these complementary portfolios, PEDEVCO gains a leadership position in the Rockies with significant acreage concentration in high-quality regions, positioning the company to capitalize on regional consolidation opportunities. The merger provides opportunities to optimize drilling schedules, leverage midstream infrastructure, and apply PEDEVCO's disciplined capital approach across a much larger footprint, maximizing return on invested capital. The transaction includes a full refinancing of Juniper's existing debt with a new senior revolver, providing undrawn availability plus cash at closing of $43 million to support near-term development and acquisitions. The Series A convertible preferred structure ensures Juniper's continued alignment while maintaining financial flexibility for the combined company. The combined portfolio includes hundreds of delineated locations and stacked pay across multiple zones, providing over a decade of low-risk inventory. This positions the company to grow organically over the long- term while generating strong free cash flow and increasing shareholder value.
In summary, we believe this merger creates a high-quality, diversified production base with meaningful scale, accretive cash flow, long-term development optionality, and strong alignment of management interest. We are excited to work closely with our new team members and Juniper to unlock the full potential of these assets and deliver substantial value to shareholders. I am proud of what we've built at PEDEVCO over the past five years, working diligently to build a solid foundation with strong assets, a conservative balance sheet, an experienced, knowledgeable team, and a clean capital structure. From this strong base, we were able to move quickly to identify and execute upon this accretive transaction, which we view as a significant transformative event. We're excited about the path forward and confident in our ability to deliver the benefits of this combination to our shareholders.
We continue to show that PEDEVCO is a different kind of energy company and one that warrants strong consideration from the investment community as we continue to execute on our business plan and seek to build shareholder value. Thank you for joining us today. Operator, please open the line for questions.
Thank you, Mr. Schick. Prior to opening the call for questions, I must advise that the company has not included any pro forma financial information on this call today or in the investor presentation posted on the company's website. The company will be including pro forma financial information in the information statement that will be filed with the SEC in the next several weeks. As a result, there could be some questions asked at this time that the company cannot answer.
In that event, the company will simply respond, "We cannot answer that question at this time," and please refer to the shareholder information statement when it becomes available. The floor is now open for questions. If you have any questions or comments, please press star one on your phone at this time. We ask that while posing your question, you please pick up your handset if listening on a speakerphone to provide optimum sound quality. Please hold just a moment while we pull for questions. Your first question is coming from Jeff Grampp with Northland. Please pose your question. Your line is live.
Morning, Doug. Congrats.
Thanks, Jeff.
Hey.
I know you can't get into guidance or anything too specific, but just at a high level, do you anticipate having any kind of, I don't know, formal reinvestment framework or capital allocation strategy moving forward, or just, I guess, trying to understand how you think about reinvesting in the business versus free cash flow generation given kind of the step change in production profile and cash flow of the company?
Right. Yeah. Well, you're right. We can't give any guidance yet. We're issuing our information statement the next few weeks, and then we'll put our capital budget together over the next few months and release guidance December, early next year. However, the way we kind of think about this is, especially in this price environment, we'll basically invest enough to keep production flat to slightly growing, use the remaining cash to help pay down debt, and fund accretive acquisitions.
I mean, we're really going for a consolidation strategy in the Rockies right now.
Great. Okay, and that kind of ties into my follow-up, which is on the acquisition side, obviously a big acreage footprint to assimilate, and I know you're taking on some team members to help with that, but how much integration assimilation time do you think needs to take place before kind of the new team can start evaluating additional acquisition opportunities? How much time do you guys need to put your heads together and assimilate?
Well, I think it'll be relatively quick. Luckily, both teams are in Houston. The Juniper team that we're acquiring was in Houston. Our offices are not far from them, so as far as assimilating, putting the two teams together, merging accounting systems, doing all that, probably three or four months.
However, that's a different group of people than will be out looking for transactions. And like I said before, in this current price environment, it's always better to acquire than drill. So our business development teams will be out looking for acquisitions immediately. And you know how that goes. I mean, sometimes those things take years, right? But we'll be out scouting immediately.
Understood. That's really helpful. I appreciate the time, and congrats again.
Thank you.
Your next question is coming from Nicholas Pope with Roth Capital. Please pose your question. Your line is live.
Can you hear me?
Yeah, I can hear you.
Oh, sorry. Thanks, Doug. I was kind of curious. We saw this asset, the Juniper assets, in a previous transaction earlier this year that was voted down.
I was curious, at the time of that transaction, I think production on these Juniper assets were about 7,900 BOE a day. I think that's from a year ago. Just wanted to make sure, I guess. Is this similar? Is the assets the same asset base that we saw during that transaction previously with Juniper? Has there just not been a lot of development or drilling activity on these in the interim as they've kind of went through that process and emerged with you guys and started the process with PEDEVCO?
Yeah. So it is the same asset base. The difference in production is that the numbers you're referring to were fresh off of a 2023 development program that had 16 wells drilled and a 2024 development program that had 6 wells drilled.
So, as you know, on any pretty much oil and gas play, a vast majority of your production is in the first year. So that was those production numbers were higher just because of flush production. We're now more in a base decline production position on the current asset base, and that's at the 6,500 barrel a day that we quoted in there. However, we do have 32 wells in progress on the combined company. Three of them are Juniper wells, and those are the first three wells that they've drilled in over a year. So that's why the production is lower than the last time you saw these assets.
Got it. Makes perfect sense. The wells that they have in progress, which side of the asset base for Juniper are they on, or is it just spread over DJ and Powder River?
No, it's in the DJ Basin.
There's two wells called the Curry Farm wells that were DUC wells when we started this transaction, and they're in flow back right now. So we'll start getting production results from them in the coming weeks, month.
Got it. Looking at these positions, obviously, you have overlap in that Wyoming DJ position between the two companies. I mean, curious how you look at the opportunities that, as you talk about potential future consolidation, kind of comparing what you see in that Wyoming DJ, in that Eastern Weld County DJ, versus maybe what you see in the PRB for kind of potential further consolidation.
Right. I think you're asking kind of in what order would we develop those or what's our development plan going forward, kind of?
Yeah. I mean, yes.
Yeah. Well, there's a lot of activity currently on PEDEVCO Legacy, which is in Weld County, Colorado.
That's what we refer to as the Wattenberg extension. A lot of development there. Like I said, 29 wells in progress right there. Next year's development, some of it would be focused there as well just because it's a very active area. Also, in the DJ Basin in the Wyoming side, which is mostly Legacy Juniper, that asset was heavily developed in, call it 2023 through 2024. These Curry Farm wells that were recently drilled have the potential to open up another leg of that asset where we would get very active drilling there. So over the next year or two, most of the development will be in the DJ Basin. We view the Powder River Basin where we have an extremely large acreage position as kind of the future, right? As that basin is being delineated by other operators.
However, we have a 200,000-acre position up there, and most of it's held by production or held under long-term leases, right? A lot of the leases up there are 10 years. So it doesn't require drilling in the next year or two to keep most of that acreage. So DJ Basin initially, and then acquisitions and future development will shift to the Powder after that.
Got it. That makes total sense. One last thing. Just on the sale of Preferreds, is it entirely Juniper and PEDEVCO management that participated in that private offering of Preferred equity?
It's entirely Juniper, Dr. Simon Kukes, PEDEVCO management, and one former board member of PEDEVCO. Yes.
Got it. All right. Well, that's really the big questions that I had. I'll open it up. I appreciate it. Congratulations on everything. Great. Thank you very much.
There appear to be no further questions in queue at this time. I would now like to turn the floor back over to Doug Schick for closing remarks.
Since there are no more questions, I'd like to thank all of you for your time today and your continued support and interest of PEDEVCO. We look forward to keeping you updated as we continue this journey. Thank you very much for joining us.
This will conclude today's conference. You may disconnect your lines at this time. We thank you for your participation and have a wonderful day.