SandRidge shareholders re-elected company directors and asked some tough questions Monday at the Oklahoma City oil and natural gas producer's annual meeting.
The meeting was markedly different from previous years in that it was led by new CEO James Bennett and featured the company's expanded board, which in March added four new directors hand-picked by the activist shareholder TPG-Axon Capital.
The formal portion of Monday's meeting lasted less than six minutes as shareholders re-elected the directors Jeff Serota, Jim Brewer and William Gilliland. The actual vote count was not disclosed, but the company said each director received a plurality of the votes cast.
Bennett then outlined the company's plan for the future.
“We've taken our fixed costs down, reduced debt and are focused on meeting or exceeding expectations,” he said. “We think those things taken together will drive returns for shareholders.”
He pointed out that the company has spent the past two years building power lines, pipelines and other infrastructure to develop its six core areas in the Mississippian formation in northern Oklahoma and southern Kansas.
“We are the leader in the Mississippian play. We think it's important that we have size and scale in the play,” he said. “We're the largest operator. We have 25 rigs running. We have the biggest disposal infrastructure in the business. To us, having that size and scale is important because it gives you a competitive advantage.”
The Mississippian can be a challenge because it is in a rural area with few power lines and because the rock produces many times more water than oil. The produced water is up to 20 times more salty than the ocean, and companies must find a cost-effective way to dispose of the water.
In part because SandRidge has addressed those two challenges, the company has driven down its cost per well by about 14 percent over the past year while more than doubling its Mississippian production.