I would like to think that Mark Papa carries enough swag that he can tell a faction of deep pockets to pound sand and they will continue to throw money at him as they did during his 15 years masterminding EOG Resources Inc. Now the CEO of Centennial Development Resources Inc., he certainly carried that confidence into Scotia Howard Weil’s Annual Energy Conference in late March. There, he faced a faction of investors hungry for promises of free cash flow and bearing a mindset that production growth is bad.

As noted in another article in this issue (“Wooing Back Public Investors”), most independents were preaching disciplined growth and offering alms for shareholders if only they would return to the sector and buy a share or two. Not Mark Papa. At least not yet.

In fact, Papa unapologetically proclaimed the Houston-based Centennial grew by a peer-leading aggressive 230% through 2017 with its sights set on another 80% production growth rate through 2018.

“We actually raised our goal several times during the year and exceeded it at the end of the year,” he boasted. “We had dramatic production growth. We keep our promises.”

That seemed the opposite message these investors wanted to hear. Now don’t get me wrong, Papa very much wanted their investment dollars to flow into Centennial. But he was adamant he had no plans to march in lockstep with the prevailing sentiment that all E&Ps wanting to attract investment capital must live within cash flow in the here and now, and especially not his.

Rather, Papa’s message seemed to be, “Trust me. I’ve done this.”

Some perspective: Centennial went public in mid-2016 via a reverse merger with a SPAC led by Papa with some 5,700 barrels of oil per day production. The Denver-based E&P now holds 80,000 acres in the enviable Delaware Basin, including 35,000 acres in Reeves County acquired from Silverback Exploration for $855 million last year. Current production exceeds 19,000 barrels per day (bbl/d), with a goal of 65,000 by 2020.

That was the game plan all along, Papa said, and he’s sticking to the plan.

“We designed this company to roll out of private equity [ownership] with zero debt. We knew that we would be starting from such a low oil production growth base that we were going to outspend our cash flow for the first several years, which is exactly what we’re doing,” he explained. “And we knew we would run up our debt. But when you start with a zero debt base, you can afford to do that.”

Centennial’s debt is 8% of capitalization, the lowest among Permian peers, he claims, and will max out at 20%. “I’m comfortable with that.”

And given the company’s less than two years old as a publicly investable entity, Papa also claims to be the second best Permian operator as measured by barrels of oil produced per 1,000 feet of lateral. The best? EOG.

“If you eliminate the first company, which is my former company—which is very, very good at this—then Centennial is stacking up as the best company, and by a wide margin over the other companies. That’s not a bad track record for a company that’s one year old.”

Notably, Centennial remains unhedged, also a contrarian strategy in a world that’s prone to protect the downside. “The fact that we’re unhedged stands for my view of what’s going to happen to oil supply and demand over the next couple of years,” he alluded.

He defined that view at IHS Markit’s CERAWeek a few weeks previous. First is the observation that deepwater FIDs remain depressed out of fear of shale upside. Second is his belief that shale upside will disappoint.

“Shale is not the big, bad wolf some think it is,” he said at CERAWeek, noting that most Tier 1 locations outside of the Permian have already been drilled, and Tier 2 and Tier 3 results will be “less than spectacular. Year-over-year growth will be less than 1 MMbbl/d.” Do the global math.

To be clear, Centennial will not run hot forever. Indeed, Papa targeted 2020 for cash flow neutrality.

As of press time Centennial’s shares traded well below their year-over-year high, but Papa’s persistent pledge to deliver what he promises banks on his personal reputation. His directive was simple: come for the ride despite market sentiment and thou shalt prosper, or pound sand at your own peril.

Papa’s back.