Magnolia Oil and Gas Corp. plans to continue operating a two-rig program in South Texas this year and is aiming to boost production by around 10%, executives said in an earnings call.

Executives said oilfield service prices were coming down, but there was a lag in the process.

CFO Brian Corales said, “frankly, given where we’ve come in terms of product prices here in the last three to six months, and especially around natural gas, I would think that there’s a bit of a disconnect in current costs for some services and materials relative to where we are in the cycle…

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“And the folks are going to try to take it out of our hides as best they can....