Good morning. My name is David, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the SandRidge Energy third quarter 2021 earnings call. Today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there'll be a question-and-answer session. If you'd like to ask a question during this time, simply press the star key followed by the number one on your telephone keypad. If you'd like to withdraw your question, press star one once again. Thank you. Scott Prestridge, Director of Finance and Investor Relations, you may begin your conference.
Thank you, and welcome everyone. With me today are Grayson Pranin, our CEO and COO, Salah Gamoudi, our CFO and CAO, as well as Dean Parrish, our VP of Operations. We would like to remind you that today's call contains forward-looking statements and assumptions, which are subject to risk and uncertainty, and actual results may differ materially from those projected in these forward-looking statements. We may also refer to adjusted EBITDA, adjusted G&A, and other non-GAAP financial measures. Reconciliations of these measures can be found on our website. With that, I'll turn the call over to Grayson.
Thank you, and good morning. Hopefully, you've had time to review the earnings release we posted yesterday after the market closed. The company is well-positioned to capitalize on recent commodity price tailwinds, to include a capital program supporting the reactivation of over 100 wells through the third quarter and more than two turns of net debt to net cash since last year. Before discussing these points in more detail, though, Salah will touch on a few highlights from the third quarter earnings.
Thank you, Grayson. Simply put, Q3 2021 was a strong quarter. Despite no new drilling or completion activity, our daily average production remained relatively flat at 18.7 MBoe per day for the third quarter, compared to 19 MBoe per day in the prior quarter. The production for the quarter as well as the year benefited from the reactivation of over 100 wells throughout 2021 that were curtailed during last year's commodity price downdrafts. During the quarter, net cash, including restricted cash, increased to $99 million, a $28.4 million increase from the prior quarter, primarily due to flat production, higher commodity prices and price realizations, and our continued focus on cost minimization. As of November 5th, 2021, the company's cash on hand, including restricted cash, was approximately $115.8 million.
The company has no remaining debts or revolving debt obligations, as the company repaid its $20 million term loan in full and terminated its previously existing credit facility in early September. Our adjusted EBITDA increased approximately 60% quarter-over-quarter to $34 million, again, despite no new drilling or completion activities during either period. Commodity price realizations increased by 7%, 74%, and 55% from the last quarter to $69.40 per barrel, $2.89 per Mcf, and $26.93 per barrel for oil, gas, and NGLs, respectively. We have maintained our large NOL position, which was over $1.6 billion as of the end of 3Q 2021. Our NOL position has and will continue to allow us to shield our future cash flows from federal income tax.
Our cost discipline continued to improve during the quarter, with previously implemented initiatives further manifesting in our financials, partially offset by an increase in workover activity associated with well reactivation. This quarter, total G&A was lower quarter-over-quarter at approximately $2.2 million or $1.29 per Boe, compared to $2.5 million or $1.46 per Boe for the prior quarter. The teams also held LOE and expense workovers to approximately $9.1 million or $5.27 per Boe during the quarter, while reactivating over 100 wells through the third quarter of this year. This general level of LOE should be sustainable going forward, even with continued planned well reactivations and capital projects during the remainder of the year. We believe we compare favorably with our peers on both a G&A and LOE absolute and per Boe basis.
We continue to generate net income for our shareholders. During the quarter, we have earned net income of approximately $29 million, a 76% increase from the prior quarter, and an approximate $80 million year-to-date net income through the third quarter. We have continued to explore opportunities to leverage our existing infrastructure and acreage footprint to best position ourselves to enhance shareholder value and maintain our commitment to ESG initiatives. As a result, we have entered into a cooperation agreement with the University of Oklahoma to explore carbon capture, utilization, and sequestration potential across the company's asset base. In addition, we have maintained our commitment to not flare or reduce natural gas.
The company maintained its commitment to protecting shareholder capital invested in well reactivation and other capital projects by entering into hedges for natural gas and natural gas liquids for October 2021 through February 2022 contract months, which represents approximately 13% of our third quarter total net production on a pro rata basis. The company remains unhedged for March 2022 forward.
We have had and will continue to evaluate and pursue merger and acquisition opportunities with a special focus on highly accretive, synergistic assets and combinations that will maximize shareholder value. We should note that our earnings release posted yesterday and the 10-Q that we will file later today provide further detail on our financial and operational performance during the third quarter and first nine months of 2021.
Thank you, Salah. I thought it would be helpful to walk through some of the company's highlights, management strategy, and other business details. First, let's begin with our asset base. Focus here in the MidCon region with a primarily PDP well set, which do not require any routine flaring of produced gas. These well-understood assets are almost fully held by production with a long history, shallowing, and diversified production profile.
Double-digit reserve life, have little to no substantial future geologic reservoir or materially concentrated capital risk across the producing assets. As a result of this focus in MidCon, the company was able to keep quarter-over-quarter production as well as the trailing twelve-month average rate in MidCon relatively flat at nearly 19 MBoe per day, despite no new drilling activities driven in part by reactivation of over 100 wells. We plan to continue this well reactivation program through the remainder of the year, which has cumulatively added a time-normalized 3,000 gross barrels of oil equivalent per day and delivered over 100% capital-weighted rate of return. In addition, we plan to convert a subset of these and other PDP wells to a more efficient long-term artificial lift method, which will likely reduce their go-forward costs.
The year began with base profile decline expectation of upper teens, which will be extended further through this type of activity to the lower teens. While we continue to press on operating costs, we anticipate expenses, explicitly workover expenses, to remain at the prior quarter's level as we reactivate more wells. We have been able to control costs despite general inflationary pressures in the market due to a proactive approach to secure equipment, materials, and services at attractive rates over a tenor that supports our capital program, as well as the benefit of prior initiatives undertaken by the Board and management over the last several years, which have yielded an absolute and per Boe reduction in LOE of 70% and more than 30% respectively since 2016.
Our focus in being a low-cost leader is further aided by our owned and operated infrastructure, 24-hour manned operation center, active and routine bidding of services, among other factors. I'd like to take a moment to highlight the more than 1,000 miles each of owned and operated SWD and gathering infrastructure over our footprint, which provides the company both cost and strategic advantages, bolstering asset operating margins through reduced lifting as well as water handling and disposal costs, while de-risking positive free cash flow down to $40 WTI and $2 Henry Hub. In addition, the interconnectivity and ample capacity help buffer against unforeseen curtailment. The current utilization of the saltwater disposal and gathering system is only one-tenth that of historical peak rates.
With the assistance from the University of Oklahoma, the company is evaluating the opportunity to better leverage the underutilized capacity of this infrastructure to include the technical feasibility of purchasing these assets to one day transport and/or sequester CO2 emitted from nearby industrial facilities. In addition to the environmental benefits of reducing emissions, proposed federal tax legislation contemplates meaningful financial incentives for the injection and/or sequestration of CO2. While these projects are in their infancy and require additional research before moving into the commercial stages, the company is excited to continue exploring their potential through its partnership with the University of Oklahoma. Shifting over to administration in support of these assets. Over the last year plus, we have tailored our organization to be efficient, cost-effective, and fit for purpose.
We have rebalanced the weighting of field versus corporate personnel to reflect where we actually create value and outsource necessary but more perfunctory and less core functions such as operations accounting, land administration, IT, tax, and HR. Beyond the more than $6 million per year G&A savings, outsourcing provides us greater flexibility and scalability to adjust to changes in our business or the market. Only selective and relatively small additions of key technical roles would be required for expanded activity to include drilling. The results of our organizational streamlining is a more than 60% reduction in G&A on both an absolute and per Boe basis since 2018. Now, it comes to many of the points we just covered.
Our assets have significant free cash flow capability, which contributed to the increase of $20 million of total net cash this quarter, now totaling over $99 million, net of debt paydown as of September 30th, 2021. Outside of smart, risk-adjusted, high rate of return investments or value-accretive opportunities, our goal is to translate as much of the company's value-generating resources to free cash flow. This efficiency of converting EBITDA to free cash flow is supported by our low per Boe cost structure and light CapEx requirements as well as improved commodity prices and realizations. Our go-forward strategy, which we plan to maintain, is to focus on growing the cash value and generation capabilities of our business in a safe, responsible, efficient manner while remaining vigilant for value-accretive opportunities. This strategy has four points.
One. Maximize the cash value and generation capacity of our incumbent MidCon assets by extending and flattening our base production profile with high rate of return workover and well reactivation. At current pricing, there's an additional tranche of wells that can be reactivated. We plan to include this well set, as well as the potential for a drilling program, as part of the 2022 capital allocation planning. We plan to share more details on this front on the next call. Actively managing marketing options to maximize price realization is also key, while continuing to press on the operating and administrative costs. The second prong is to ensure we convert as much EBITDA to free cash flow as possible through capital discipline and investing in projects and opportunities that have a high risk-adjusted, fully burdened rates of return. The third is to remain vigilant and maintain optionality for opportunistic value-accretive acquisitions.
We'll focus on PDP-weighted assets that fit our core competencies of cost efficiency and production optimization, which will also have sufficient midstream optionality and are in favorable regulatory areas. The final prong is to uphold our ESG responsibility to include the continuance of no flaring, as well as assessing the viability for carbon capture, utilization, and sequestration applications across the company's assets. This all sums up to, at the October 29th, NYMEX strip unaudited proved developed PV-10 reserve value that we believe approximates more than $410 million. It is important to note that SandRidge's value proposition is materially de-risked from a financial perspective by our strengthened balance sheet, robust net cash position, financial flexibility, and over $1 billion in NOL.
Further, the company is not subject to MVCs or other significant off-balance sheet financial commitments, and over 80% of wells can produce profitably down to $40 WTI and $2 in rehab. This cash generation potential provides several paths to increase shareholder value realization, and it's benefited by a relatively low G&A burden. As we realize value and generate cash, our board is committed to utilizing our assets, including our cash, to maximize shareholder value. Finally, worth highlighting that we take our ESG commitment seriously and have implemented disciplined processes around them. In summary, of some of the company's current strengths, we have low overhead, top-tier G&A of $1.29 per Boe in 3Q 2021. Have low operating costs benefiting from a large SWD and electrical infrastructure requiring little to no future capital to maintain. Have no debt, in fact, negative leverage.
Significant free cash flow and a growing net cash position supported by a diverse production profile, multi-digit life asset base. I'll mention the $1.6 billion of NOLs, which will shield future free cash flow from federal income taxes, as well as the inventory of low-cost, high-return well reactivations that will help flatten production decline. We'll have no routine flaring of produced natural gas, among other factors. This concludes our prepared remarks. Thank you for your time. We'll now open the call to the questions.
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That does conclude today's conference call. You may now disconnect.