ConocoPhillips (COP) 3 Nov 212021 Q3 Earnings call transcript

Company Profile

Participants

Ryan Lance	Chairman and CEO
Bill Bullock	Executive Vice President and Chief Financial Officer
Tim Leach	Executive Vice President of the Lower 48
Dominic Macklon	Executive Vice President of Strategy, Sustainability, and Technology
Nick Olds	Executive Vice President of Global Operations
Mark Keener	Vice President of Investor Relations
Ellen DeSanctis	Senior Vice President, Corporate Relations
Roger Read	Wells Fargo
Jeanine Wai	Barclays
Neil Mehta	Goldman Sachs
Stephen Richardson	Evercore
Doug Leggate	Bank of America
Phil Gresh	JPMorgan
Paul Cheng	Scotiabank
Neal Dingmann	Truist Securities
John Freeman	Raymond James

Call transcript

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Operator

Good morning, and welcome to the Q3 2021 ConocoPhillips Earnings Conference Call. My name is Sanera, and I'll be the Operator for today's call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] I will now turn the call over to Ms. DeSanctis. Ellen begin. may you Ellen,

Ellen DeSanctis

Executive updates. mentioned, reminders. posted third A some you, the we'll Vice Sanera, go Relations, Dominic Earnings our are very the full Quarter results, Executive Today, prepared today's Executive material press Bullock, some everyone Lance, Global of Officer; could Chief and Tim Leach, periodic cash brief, the to also flow and In financial in described our In XXXX measures expectations. some Olds, release, Nick well forward-looking factors we President the room Macklon, welcome with our our format Bill as mention Call. Vice CEO; today President of Chairman differ to Sustainability, and due President this today. Sanera year few today's Investor some a room earnings in results we'll deck current and on XX; of earnings will our we Executive Financial Mark filings, Operations. President of release Third in the Vice and Thank Vice and our Lower our with addressing Ryan our Actual Keener, guidance Technology; supplemental as remarks, is consist and President of of quarter as non-GAAP based to quarter statements conjunction make Q&A. and morning. Vice fourth The Strategy, will me then of call

to that, the and reconciliations press GAAP on website. can I measure With Ryan. to over find in release corresponding turn nearest now call will morning's You our the this

Ryan Lance

Ellen. you, Thank

address for them In notable. operating make details then Bill something morning's the mentioned, as context a outstanding session. release, this results we'll referred as Q&A results, begin Obviously, describing a and quarter's this meant quarter's financial comments the results were different. few opening I'll but then and few I to Ellen the about As notable will and

and the that our of flow. close forward most high aspect revenue any significance For plan E&P going all improving by We've the as a Concho, business, announced our for the it is creating right of X the Company from with is been actions transaction, of the is but our across torque executable the We'll schedule. quarter's the helped of On ahead even The past the direction. integration represents synergies for we've basis, importantly, run-rate The year, operating upside a competitive performance delivering core expected. transition. past took stronger conversion complete. integrating global of We're this underlying Company in post-Concho, of metrics captured cash of out baseline decade. billion and the income having essentially in Company. savings the is the is connection moving Every unedged, in more to to to the mandate XXXX triple as time compared energy

we've will fourth achieved underlying capture we margins integrate and properties to the reflecting intensity intensity lower, stringent, by expanding, close, the benefit our now of month estimated closing an Between targets Our improving, are costs portfolio return which to and to stronger occur XX% on what overall more is just year underlying is are is supply we transaction, integration. commodity to Shell XX our headed we capital our our in and be a than end, trailing expect quarter. emissions prices. year similar diligently Once through reduction working Concho is employed priority the GHG end, the towards fashion top more of efficiencies in these

low a we update, We're anticipate included set up June, optimize to in the June, incremental some investment, in Alaska layering investments excluding these don't we on price expect Norway. Directionally, pressures, and and the Since significant provided ramp announce now of June early to CapEx we see departure an and the XX in In some in existing in year Canada, in outlook Shell. everywhere. XXXX per process supply based high-grade some base December. notable. we next cycle high-performing in our plans, included our Lower longer of $XX XX. our roughly optimized a platform, in which setting to cost plans, we're from capital for our Montney reactivate our the in Lower what to continuing we inflation The is portfolio properties addition on In top modest of business a especially on barrel that drivers plateau

them to Scope course, However, June into maintain adjust that response expect Shell we've the in of point, to at roughly level brought we properties add for tune to consistent portfolio. at we'll order our a our modestly update, then once the base would is capital and CapEx with this

workforce. emissions be progress we offer. will the business. Company, But and winners is goes supply more investment saying, on plans, cost and of inflation more incredibly for constructive year pressures, we be so, that's December. constructive, be with come of will an an talented watching eye lowering but we closely, there's our lowest options, busy and macro believe the certainly returns that know far, high-grading certainly of finalize to volatile to a but must in without what the relative We But thanks a always appears the remember The OBO for to that time successful our ConocoPhillips That's even delivery It winners. capital, we relative our peer-leading and we're been It's there on entering processes. on market this that incredibly intensity. dedicated undertaking companies an potential we're sector. capital so As XXXX visible typical very the and one and on keeping

ConocoPhillips quarter glimpse off point a forward. a expect you to going represents third can Our and jumping strong what from

quarter. over Bill, to the items it who turn will from of me some let now cover So this key

Bill Bullock

were of expected DD&A. than to share quarter. that Ryan. per price the Relative volumes realizations, earnings for begin, and this better $X.XX above Thanks, consensus, than reflects lower expected guidance, performance adjusted the production slightly were To midpoint

for the prices. captured prices. getting Brent realizations material better percentage provided information and the exposure realized to Ryan We this mentioned, current full in of to As supplementary address as higher we unedged, morning's we're variance, a overall our higher in realizations, so we're the pricing

prices. result positive As as for the DD&A, to of to guidance we're trending revisions previous lower compared reserve higher due a

saw You $X.X. today's lowered $X.X DD&A XXXX from we to full-year that guidance release in billion

X which equivalent averaged underlying XXX,XXX from production for XX,XXX the Libya from a was including day, Excluding represents per growth. about barrels Ford, XXX,XXX Bakken. Permian, X% $X,XXX,XXX the barrels Eagle day, of XX oil production from the about the XXX,XXX quarter and At Lower In rigs planned drilling XX. turnaround the quarter, we activity end extremely particular, the went Across of seasonal smoothly. across of our rest ran safely Lower frac XX in working had several and our business crews regions the well. operations, the operated and the

the we're reporting of production marketing X-stream fourth of release. to Concho this ongoing reflects You XX. and guidance XXXX that the making for a basis the contracted create for year full have morning's in to a efforts our X-stream optionality across as noticed Lower provided to impact part quarter decision convert volumes we This the

considers costs neutral. we've barrels is U.S. such this were in the In our where results, our lands, approximately operations by other XXXX price provide roughly revenue Once fourth by and ongoing and guidance third in majority tax production, a $XX ranges $X.X the $XXX words, and quarter. million. which and was DD&A conversion as we'll position other Shell sensitivities paying the factors XXXX back earnings changes various operating no from projected acquisition earnings an those there and to was about tax Besides items. globe. in closed Coming for conceive increase might cash is how flow convert around legislation million to updated will both that cash ranges increase conversation items. production cash Reported the the day, reduced expected contracts of jurisdictions to nonrecurring billion, at expect XX,XXX We by quarter impact

shareholders, flow higher this basis. first So than months basis, is was a this quarter, meet average an underlying about target year-to-date on Through end buybacks. by billion returning of returned we're our $X XXXX, of nearly billion $X the to is and on the through almost this to billion. dividend and estimates and and combination the our bit a external we've year, on of $X.X track a Free $X ordinary of billion cash X the of

and into achieved So plans begin Setting the lowering we is significant maintaining a our look returns December. The providing business. and work for running powerful to the a turn the Shell up getting entering additional Permian can XXXX, we've base all and of forward acquisition integrated closing on focused a of position ConocoPhillips we that creates triple the year. summarize, capital what fully reset the our the notable portion intensity. was it well, operator those a of as in today's over emissions to now the Ryan to call That's call. business so We're That XXXX, capital exceptionally and about, properties post-Concho. Company Q&A mandate. to leading I'll of platform next information begin quarter. for said, is That's on

Operator

question-and-answer Please from We'll comes [Operator Instructions] go Read Fargo. session. you. the from ahead. Our now question Wells Thank begin Roger first

is line open. Your

Roger Read

me. you you. Yes. hear Thank Good can morning. Hopefully,

Ryan Lance

can. Roger. morning, we Good Good Roger. Yeah, I morning, know

Roger Read

the to CapEx I question. today, of quiet there. inflation you know bigger about really more seen have December, you'll was you come arise? what back I maybe to headwinds think the in inflation just It may Sorry. but talk an idea Anyway, want where

Ryan Lance

all we as world the about Roger. tells XXXX. you’re about of at most middle anywhere probably globally, most globally. X Permian rest the inflation Right the right supply we're as and and pieces, to U.S. the in now, Sure, though that opening influenced at rates XXXX, kind the into being, it's higher still go where so inflation area of mid-single-digit depending low to the in of our X% said putting double-digits the chain then our geographically thinking Like single-digits, from we into U.S., I experiencing rates go me the X% the But now plans in organization comments, into the the bifurcated being the inflation together.

like are categories OTCG, and in So low pressure we point, the right need U.S. those that the the now, are you of things out pumping, here imagine inflating certainly likes. start sand, recover labor, to in that the can as are

it that anything I some Tim Permian. relative for much forward, Scope modest I to Lower in through think as you XX we XX. I of it's the which is can ask efficiencies, the Lower the want think in to to add where in offset try Tim to about production us as opportunity focused an if going that the think to is

Tim Leach

No.

we have most while I and of we that in would seeing operations of the to on scale that items, advantages say size and I organizations, think continue XX. covered it. those combined are Lower inflation our improve the But

inflation think I many can mitigate that there's ways factors. those So we

Roger Read

Okay, bit, terms of opportunities since great. curious, any we you in Thanks, it's just in Willow other Alaska? Hilcorp going think partner been then what just what's on I news quite meaningful forward, been about was became the a in the go Have changes Alaska, in noticed Bay? do can't other in and since Prudhoe

Nick Olds

Nick. is this Roger, Yeah.

update a Just quick Willow. maybe on

cooperating As with substantive efficient the do work those you've Justice and particular that additional to NIP the approach the We'll the press, ruling. probably up really of BLM issues. most in were appeal identified that decided working the in Court not decision. the both District engaged the is We're district analysis. ourselves X We Alaska through there, and feel and just through to seen there X through court currently agencies Department issues best

we engineering of refinements as continued of FID. forward, an and and and we mentioned, look development costs service you schedule of detailed all-in continue service through many to our As modifications, our doing work

a as look and you our the significant continued that at see North still Slope the of state burrow. the Alaska, program, Alaska work, from will shareholder well standpoint, engineering as XXXX, delegations, reflect support we from If capital then the

committed front. remain So this on we

to existing Coyote. supply cost got we're about in we've across facilities, then continue low the XXth In other both example, improvements we're spoke that [Indiscernible] so leverage update. of far costs Prudehoe the as pads, existing infrastructure, and got reduce we efficiency Nuna. As opportunities and market very They board. These as on safety We've June front, seeing the pipelines, projects, great and progressing, performance.

assets So are legacy all are three engaged, so performing our teams well. heavily

Operator

you. Thank

question next Please Jeanine comes from ahead. from Barclays. Wai go Our

Your line is open.

Jeanine Wai

our taking for Hi. Good everyone. morning, Thanks questions.

Ryan Lance

Good morning, Jeanine.

Jeanine Wai

Good morning.

in year's first At with on X well. this intensity you and Scope Shell is shareholders X. the setting targets in your Our of Scope great. is an Permian announced acquisition, believe question In targets, which voted meeting, favor I Scope improvement X conjunction Company X emission the as reduction

Conoco? any you've from strategy maybe your on for us on could Scope that for shareholders vote? X, Perhaps Company's the feedback color regarding addressing that production update So you received targets

Ryan Lance

Yeah. Sure, Jeanine.

Shell it process this but to from [Indiscernible] hopefully comments make yeah, X, gross the not Scope who's our in few me targets the a to Dominic, coincident acquisition shareholder Let consistent a related normal a we announcement all involved That's and and of industry we as our and maybe our well. went activity. been needs engagement over that I'll increased we operated net time equity, saw which turn you think a year, Scope or part , move to with to to X

it's you operate, are So from what net equity a in involved it's only perspective. not what the you

X, then reduce Scope our resolution not got that binding, you commitment on we XX% as X have of a Scope and but that get engage shareholders did and focused to with we're the on. our So to one vote, pretty we state, our

from So that the and Scope so or we've looks we've X like side been far heard shareholders. what on specifically, I that get on maybe comment doing to what Dominic can

Dominic Macklon

shareholders. question. for We're dialogue matter. process in this very on an Jeanine the ongoing thanks, is important continuing This Well, all with

of zero to and we and Framework year key think is that our believe X. transition realities emissions that's often competitive emissions our as the that pathway talking I launched credible Scope we Scope you and ambitious net ago a and continue elements that's triple X responsibly us the returns, both share to about that E&P achieve Climate Paris-Aligned of an Company, Risk and about, mandate on addresses we deliver demand, hear meet some control, dialogue so

not a low-carbon our year, We and But have and X progress units, our X Scope ambition. net-zero achieve we they're now end-use targets, and this group, supporting our Scope X established earlier ignoring and are dedicated to technology just emissions. ongoing business

emissions. target producers valuable Company demand shift like a X X E&P and accountable less intensity and focus carbon our new But crucial for to supply opportunities sense away and our Scope a adjacency businesses makes storage to focus low-GHG those has competencies. well-designed, on that and a in low develop and believe business for to side, actually of a in low end-use believe continue Paris-aligned see and and reducing it carbon course So deliver must carbon solution working for supply to and have producers a which new the viable price fact returns play of cost ESG actually on the low strong transition. of caption that Paris-aligned advocate top-tier as for But both we policy address a as groups energy ConocoPhillips don't economy-wide we with jurisdictions, are and Scope and role on also production wouldn't to competitive a shareholders, carbon, core with hydrogen, would our consumer and addressing opportunities and demand from most it we Company we E&P a

our of course, seriously the shareholders So, understand We'll next continuing their a to take flavor the months that views we're that you our an perhaps process. continue very we of gives and ongoing It's dialogue. nature through here, the engagement of now perspectives. of but couple

Jeanine Wai

they item development. what the here Okay, look housekeeping We XQ the little second really commentary question, the call. That's is implied carbon any just in the we there's prior slightly understand distributions, if outlook forward bit think timing capture hydrogen in below maybe a were The helpful. our affiliate for guess of It seasonality related our the APLNG for on was and I full below if by distributions. great. distributions to quarter million if year? unexpected anything $XXX or wondering change little was there this the on year distributions? of We're a there was is We to forecast.

Bill Bullock

and for full-year received third $XXX we our expect of of this and million around $XXX APLNG the year-to-date Jeanine, in now from from APLNG the brings Sure. million million distributions year, $XX year. quarter, to that total distributions we

higher and second first due APLNG of on the receive there's little as lag with XXXX fourth in quarters about we pricing noted for and you think distributions sales, quarters, really and to you and the lower long-term as third the As to remainder a APLNG typically reminder, sensitivity price LNG distributions. distributions and

$XXX is very so, essentially about for the LNG As pricing set good million feel full we year.

Operator

you. Thank

Our next go Neil question Please ahead. from is Mehta Goldman from Sachs.

Your line is open.

Neil Mehta

your and Good morning, Ellen, Ellen the investment to and industry on thanking her community. be to service sorely Congratulations missed. let team, me start are by you going to for retirement, the

Ryan Lance

going she We're Thank appreciates well. Neil. call-out, as Yeah, you, miss Neil. her to the

Neil Mehta

us. escape can't you Ellen, Yeah.

know where us. you to reach So

Ellen DeSanctis

try. to going not I'm But

Ryan Lance

She's either. not to going escape completely us

Ellen DeSanctis

It's hands. and a honor an ConocoPhillips won't great in honor, You're Truly everybody. beat. an been miss

Neil Mehta

actually the the industry is a value and time appropriately, period at have we E&P one, how so recovery the extent upcycle? what the you potential the had of in great. kick and structural then question big you've long the Permian. Tim, I Ryan, beginning time shape. of we're left it underinvestment period off for are a you think excess create through had a to of on you The a industry, the in is destroyed and about of Ryan, to opportunity Well, last picture of here? I term do That's the the multiple follow-up extent years them telling Which want picture differently Do upcycle might great for folks X you're this a message as flow? the you industry, big see dark years leader is, cash you, here. you your the ahead in been to question lot a not a oversupply do we've very in of structural of the kicking structural on by value over seizing of beginning we But be to the the

Ryan Lance

know. Thanks, a Yeah, problem, recovery I constructive of Certainly, the reasons Neil. and We're think stated, the turns seeing a this into reasons. the for be to some and industry. demand I for constructive all supply for tailwinds number pretty going post-pandemic pretty you that's

a of provocative you So there. a yeah, bit ask question

maybe So things. I what few a say, would

have my going and and peers, only returns capital competitive For we've with I consistent that's sponsorship, to market. on be say, through got they to employed, happen would restore the sector to

what the industry. boom-bust think we I opposite saw of in that's this

need good sector. So to investors and I think would short be that us I a this on leash, for have think

without I what think remember be I of in inventory that capital. kind really like I Shell cash that's have of matter. business, I best we is different a What that So have ConocoPhillips, thing to you able having tell is blown and on free the But now run ones returns flow because think the right one industry investors? business, short-cycle inventory to through do would does It returns, can make competitive peers. that tell roof would growth. we on going Because my that Shell and so being we're for the inventory be returns managed market can now quality to with as

can have that paradigm returns competitive growth, the top-quality shift. market that's for modest people with a and So deliver of think big those kinds you Shell I pretty inventory,

on capital and discipline really, really growth matters. enough that So on returns

the peers, be energy investors and for this and really, Lastly, is would transition for happening. my is everyone

our had, really Jeanine Dominic simultaneously triple a just got mandate. transition of through, and do going we've through must business and thinking, well. do to We are this to three the requires question is I today, that's things referred new a at think a new lens really, which bit those to but look that we last it them that, I think and in that have We

supply demand and by low transition deliver, that XXXX to , our we've on, we've to meet this to ambition got business. have the it to [Indiscernible] going because we there to So barrels Whatever got to cost we've got slope meet supply with net-zero in be demand. ultimately

industry that I Neil, So if shame can be do I will. it guess I few and guarantee on and that offer can't this would things the you ConocoPhillips really us would

Neil Mehta

where playbook at that's have on specifically, the and to You Permian are and guys and just position this perspective we the delivered the point Tim, good to the acquired? you've a your terms you, absolutely hood about talk what feel a assets, integration and do in gotten time you Concho more of about How assets. of look you've under Shell take of probably the dovetail,

Tim Leach

it's pretty Yeah, exciting.

But X team is really and has to that tackling the really business integrate and addition to on in between the about. I'm our team of a proud not the more of miss are how cash watching continuing talked able to We're execution, synergies all U.S, beat being we better. great of Permian. wells flow deliver delivering acquisition the The is production wells on groups, in drilled they're and that, First is make as all really efficiency information transferred, all, and important going this blocking our The well. much going of Concho deliver That's how in get and Shell well concept being and basins and everything all ConocoPhillips better. the getting on those time. work the

you look create live So those to make what we we the future, that's acquisition, and that the and then with something go better. our die what can and opportunity and when the teams that's like do exciting can them, is opportunity get how the for, with value it and Shell at with assets, for

I'm done now. right pretty of and proud excited So that's I'm the being work

Operator

Thank you.

go Stephen Evercore. Our question next from ahead. from Richardson comes Please

Your is open. line

Stephen Richardson

Shell Thank that that upside yet, hands the with one of of big you. it order? could on follow the but us from just I talk haven't question those industry it, your and knowing wondering working see equalizing short will in that and if and to had having areas Could of you could transaction last you you I holder including little appreciate opportunity come closed trades up I up blocking got was that the a total from as have assets, seems and Tim, the interest on your about swaps you some be bit you Shell. assets and position incomings Tim.

Tim Leach

different of best, the kind do the so completed, like way I value can we from in. many what additional and assets the is and the also that are that ways the wells there drilled, it gives think the us Yeah, create arrangements, with way opportunity those are are managing coming wells we assets marketing

can what dispose and how We on have can high-grade we portfolio. way our of more flexibility we

I at an So but we're good operation from also trades. it really what swaps us do standpoint, from management gives think the opportunity and property the to and

We out have much they and a are All in kind create around All of the of group like get the of and that. other's way trying a dedicated can each opportunities. to that, lot create operators value basin. and drilling so lateral outside-operated, not longer things have

Stephen Richardson

I at with as that about I the prices, follow-up is these But and we of Canadian years down contingent on If Western experience executing on could that from was you wondering also would back noted pretty sale way filings, a looks you. you so talk all Bill Thank specifically, and the just maybe nice public number can remind uptick from like payment a oil please? terms sell that happening, that a and glean it of in that pace. duration stand quantum the if orderly Cenovus well, in and with of the of of us can far in could what where that associated

Bill Bullock

to. Yes. Sure. Happy

to through of X%. about year-to-date. million about been was our equity with our That's and we've CV the So balance, bulk on sold XX% monetization that proceeds the reduced first XX used original third slides million about shares to third for million back about note you'll we buy and shares of quarter, have XX% so that the starting Conoco $XXX stake for about in Cenovus's our from Those about program, quarter. $XXX cash

of exit we're sales, sales next way. position expect measured accelerated sometime our and a executing have those we and in thoughtful We early to year part our

monitor to market forward. continue move We conditions we as

but Assuming early that next part of they out be year. remain we'll supportive,

from about the You contingent asked also payments Cenovus.

we year-to-date another quarter, in as so and to fourth $XXX total we'd the million million about recognize Cenovus's payments, $XXX bringing expect current pricing, at pretax to the recognized During far our quarter. about $XXX contingent in million earnings,

first prices, year. at probably term payments Now contingent next still XXXX, San Juan $XX that also year. year in to on million $XX of accrue in we that sale. that in we've fourth at in current our should and in expect to continuing of It's to current year continue and third this the million contingent expires receive million end we quarter expect accrue the This mentioning but their quarter, the that strip through another from bid, to payments the accumulated the second next quarter would throw quarter, continue pre-tax would at are contingent $XX worth also so the far second prices, and with and calendar

Operator

Thank you.

Our next ahead. Please of Leggate America. from question go Doug from is Bank

Your line is open.

Doug Leggate

Thank you.

at to help of be to know we Ryan, I , pretty Really, Let sure to call me couple this brain A wonder what any, all cash miss I than question I bigger you're things, spot. the I question Ellen. that pretty come going add I'm may. your to could to when luck return you if is the evolving years. point. at BP going looking thinking my I much congratulations your not we're I'm on over you. I'm on on get [Indiscernible] but you're the good if is and just and whether a lot pick for thanks

You're opinion. knocking of my yield dividend XX% not? of greater door on and you running peers, up for that proposition get Total step scale, the your in easily about Shell value is recognition those Why and in terms average, of and on the could

Ryan Lance

Yeah.

the clear, the appreciate be Doug. to and pretty tried question, I think I push. I

I shareholders. to think clear what is about be tried back I've is to pretty our the XX% going of CFO

we've in coming can the should with this and run-up to operations take of commitment as a to an in that's expect bank you our from get result. you ConocoPhillips, here cash a So seen prices our lately, as XX% investor the that

and with I'd say Shell this. outlook before through the course the dividend the been more our to acquisition, of to things as the to share right we try to we'll directly conversation repurchase. the about But the the go I've going distribution of channel. split to maybe balance channel. your more asked, You the between what some view macro about look probably now and onto channel the comfortable sheet our ordinary on are where question based put money

XX% when how of So this bank, about down incredibly how be those do and count you you works dividend, it, we on through growable, reliable, the and get go you think can That's I into downside something euphoric reliable, needs can the turns. it it take to transparent, these dividend? I think can the For whenever it's ordinary about me, it's I it's times at that's the think I sector pretty there, how are always being that's should expect importantly, about the and the growable, you of operations. commitment. cash our what continue dividend. done and a got That's so and commitment, our a more reliable, good, about think our number think back to but go we've to it's for think of do. That's we're to that's years coming I you've get to But from what dividend going

locked do we've circumstances going into market, had the we a pretty those goes open and our investors, channel. perceive changing, we're the So that if up, not this you're conversation with been to channel that. as to to go get We've CFO dollars, specific with and

I probably think your ordinary Doug, So I the just about differently. bit dividend a little point, take

Doug Leggate

market more behind Thank question, answer. it's to guess I I figure to kind answer. to but the appreciate appreciate the recognize what appear my this, of, you. trying what's best I the about out is

Ryan Lance

what's be a haul a what quarter, value, to in just the but builds needs over right long term, over Doug, recognition, model the volatile over business. a very or the long month not The

Doug Leggate

coming heard think few very structure of little years just portfolio. it obviously, while production a I slug capital you there. follow-up I'll large little that I flush if today different touched thinking could that say we've of things and for may high-grading you you don't you very a I were Thank you. there in, Very got some push in and the you guys quickly, a to a on Sure. than out, the on My and ago. to wonder leave you touch bit

Ryan Lance

Yeah. Doug. No, thanks,

other of about this large market transaction Lower $X billion quarter packages delivering couple significantly market of closing primarily that billion $X million billion talked got $XXX in $X We've billion larger had in portfolio, sold sales. there's we from announced the Those billion sell result $X because to I things. on first a the on we've in of would transaction Lower road that team, We after to couple the today pretty to at But that the is through we XX we are with couple well XX. out the swapping as Permian, we assets. billion. the largely market $X do today in Shell outright you we to and the some that another when some cleanup that and going Tim's than to think We June the think update. upped the the $X just $X We're described committed. that $X we're the earlier, and to be what of We billion can Shell get to billion. the look worth trading the and

comfortable that of next the year of probably with So pretty billion but us a Obviously, delivering lot progress first XXXX, $X $X targets. through those half in take target. making into to feel billion I

Operator

Thank you.

from Our comes Please go next question from ahead. Phil JPMorgan. Gresh

Your is open. line

Phil Gresh

the $X post is through XQ in guidance just afternoon. on gone that there the My balances, in first Good other Any pieces thoughts Shell XQ, updated the question the acquisition we've cash here of any now talked and about today? call that Hi. or moving you billion pending prior about cash.

Bill Bullock

of $X expect would about little very up that $X year, of billion, as by Xst the The Yes. billion a so to we of year, end the end good through price effective with Shell is Sure, July this cash. date Phil. over the cash $X.X we go this and is We headline still ending but transition of feel year. billion

Phil Gresh

of and the around acquisition, a would factoring the little teaser Shell Okay, question, higher have for cash any payer taxes. prepared updated you impacts thoughts second Do gave oil tax you etc.? in become then would in your cash you remarks the prices, be, on Bill, you when a

Bill Bullock

Yes. Sure, Phil.

a So U.S. early move pricing mid-XXXX. would significant into tax to paying current in the position continues XXXX, if into expect by we to

Phil Gresh

How the overall about just Company? for

Bill Bullock

overall be similar. Well, so the would Company

on main cash in our is so international the if tax are U.S. paying look them assets, of across So the you change position, a many already

Phil Gresh

Got it.

Okay. Thank you.

Operator

you. Thank

Scotiabank. go from Our comes next Please ahead. Paul from question Cheng

Your line is open.

Paul Cheng

you. All right, thank

retirement you a first Let help. me so, wish wonderful your healthy add and my thank for and congratulation Ellen to you

Ellen DeSanctis

Thank you.

Paul Cheng

$XXX too quarter, and actually period target for longer-term this cost say Two the in read questions. that stay in reaching a third the maybe that for Maybe there we of production [Indiscernible] close is your time. the [Indiscernible] I think maybe strategic in team, much. to In long sequentially down, long-term, about [Indiscernible] XX-year

Permian or maybe is that third game in on-stream second So the of what first we is well question, the that's that the we've later. wondering will So quarter timing plan asset, question maybe coming that? with ask I should the the the read the on and and more just seen that still

Tim Leach

get coming in Eagle more timing Eagle of things you Good. capital optimal Ford we've the I'm that asset It to quarter-over-quarter the think that around. referenced, very call is much Thank optimal rate and and that this closer be is. can have continued the about about Bakken The but performance that Permian said we improve of increasing on than about pleased the Permian that, way are The a to the doesn't at performance and we things that the the long talked We managing are before plateau sequential Eagle things will the Ford Bakken Ford. their But Eagle and like and there is asset, the and being with time, the there been refraction, other you. like Ford. we allocate and have wells online. for that the Permian one activity at plateau

Paul Cheng

So in [Indiscernible] sooner? that ? in XXXX, maybe aggressive you're Tim, to how other rate going words, production [Indiscernible] XXXX, or

Tim Leach

Yes.

reaches guidance like We its but it haven't things that, given generally on plateau sooner. much

Paul Cheng

Thank you.

second Bill The it's or for question maybe for Ryan.

up the much I $X cash phase you return, the year. think the $XX this billion last WTI on price is stronger. the on Obviously, when for set

we Shell the because should to that sheet? of or just to than that cash return more assume you're the to have their additional going So and balance that stick transaction, you're strengthen to going

Ryan Lance

the that the plans and At this have our $X looks gets for we $X that that sticking we're to for this But the pretty total That's for shares buying like the through place ordinary us guidance return dividend were year. next we're billion close and what to XXXX Cenovus's. that shares in is your point, and swapping CV, tuned billion through stays of the yes, return. year, with the

Operator

you. Thank

next Please Dingmann from Securities. Truist ahead. comes Neal go question from Our

open. Your is line

Neal Dingmann

just it X/X what sure the quick was it's is some Look like from bulk, on want make on just quarter. cash that out a said. good shareholder this result, in just to on flow clear the just a it payout? how follow-up stated of I I sign $X played I the billion. you Ryan, Is think return coming that, the

Ryan Lance

Yeah.

probably ratable. they're swap here shares. the the than of quite first The after I think restarted dividends, ratable Cenovus obviously the we so, announced other four share you with yeah, not that buybacks raise we the and swap saw recently, ramp-up Cenovus some across the in quarters the outside our quarter

at in our there that into the the saw you up You fourth results, third ramp if quarter. continues the you assume that quarter, and should look

Neal Dingmann

for probably second, then Tim. and fabrication Great Okay.

whole that? last, see some and the that's or it Obviously, I 'XX mentioned continue want you of steady. you ramp is activity in activity, have the I the if earlier just there don't remainder Permian the given deal, mentioned would in still one in talking on your indicating yet. out turning that wondering, I suggested Permian in year, what activity, more know see post XXXX, Shell notable [Indiscernible] this to Could on we peers were increase know is just the you're the to about. my question of a gotten . works just at you thing's to 'XX, on we see ramp You a I'm

Tim Leach

a all for We level steering they that's still But would goes, ramp, wouldn't steadier Shell, that it hands call through. most it continuing operations. planning that I we're haven't for our currently our there. add just we tell we the activity, referred will we that as as I next of steady I that until be and in you really the on call Ryan year. going our build I she tell would activity ratable will going and that in efficiency have That's strongly what you completed on growth, planning believe the to think wheel, slow it the because we we're get

Operator

Thank you.

Raymond from John comes line Our ahead, is go next from question Please open. James. Freeman your

John Freeman

the XX-year enhanced a price have higher to looking plan, last just you incremental Shell sure $XX the incremental basically over $XX got flow page with that is the about I'm XX-year the the Thanks. $XX that was trying you cash the the nature afternoon. thinking billion from about same full of time the $XX to that the billion, plan. your billion all and there I'm on went transaction you-all obviously assumption I'm obviously but with talked That you unhedged if or transaction make Good that incremental just how when got revisit distributions. at enhanced that free the shareholder toggles portfolio, have which the I Shell then given after an and different have want to oil do

than about just other [Indiscernible] it you guess I'm would think something matter Ryan, Ryan, is how really trying look it? distributions I theoretically goes that take is, to about incremental it all think So just shareholder to it just the oil production helpful. to, what will the for how at you just what the you doesn't or price be X%

Ryan Lance

John. Thanks,

think, I yes.

think think it deck. update again, on plan about it I $XX top, market you should barrel at the price was

increase, that shareholders should view so a in distribution macro back still capital of XX% be going the as We're go that always what that we'll So don't really cash shareholders. an is think very increase of then out conscious is expect a Company, will the capital into that's the to we sheet going can good done This the deliver We're cash the X of have strong to go some to we of of want to our kind to returns, manage. price constructive to we'll going plans. to is important that to that's growth, is where to want flows go the increase. our idea seen to before We've on strongest the of years. returns high set super budget our inflation. to for you been investors commitment our make maintain the pretty we and what for deliver and to We and that our balance we on having phase going sure next blow macro plans balance to very but the cash sheet the the our output X We modest a into year. of next

and But XX% that the beginning, better, and we the shareholder, judicious made you Shell in XX resilient us what what industry more can. we've than a done go every capital the getting Shareholders ought running we're really set ago years sure the make expect cash like to We'll process. be to of our as reinvestment maintain we'll They'll through most capital of assets back a the buyback, we're will very out there past. if that do of more to be differently through we of the XX% a to back. channel, this the more how just assets act say going so and made capital So to a we then at are to get a the thing another means to their we're strong to and XX% Company Company the dividend cash where remember, balance to like at we're the through share adding we're Again, tried flow we're I running executing right going sheet for see maybe and our that's with returns Lower get Shell made dollar some the just that's Shell about number rate. did. this at

Ellen DeSanctis

take John's Ellen. is up. Sanera, then second it question wrap and We'll this

John Freeman

the then But Thanks, single-digit how kind we of versus and any you of has lean versus just that seen Okay. with low versus XX guess doesn't where double-digit the high international which modest, XX part and about sound XXXX have a of Lower portfolio, side that that XX, be it we anticipate this rather see like, still that, at I the plan, international efficiency question. my should obviously, to inflation, your least little Lower and in XX just might but portfolio? over for Ryan, a I inflationary international, a in follow-up talked pressures on perspective great the on team is done Lower his but X% to Tim job service X% shift sort gains a all Lower spread international more the is it material mix. to realize bit from wide would simplifying concentration the on inflation

Ryan Lance

inflation we think don't rates on capital based different those allocate how I going. see we'll probably

significant So today. try I how we to the to in just in developing it think seeing we're the what see categories we watch continue have We'll to spend want Company we be and of clear it. you idea that about give an of

might business see we starts to scope that. adjust us, more probably running Lower modestly go XX hyperinflation goes so to into our from not away going think try we to we're our I if

chain his very focus So capital commercial really organization, and that got a business we're efficiencies of returns one the are said making the the sophisticated are sophisticated in we're investing. with still that a supply on I a large we're sure out there. very adequate organization Company, we've it's know again, responses, for wringing the Tim of

gets it as quite to adjust we out have a way example. of it, mitigate our control So just lot a if will we think and it an plans of

We're to So, a advantage global, and when think that's that's huge the impacts we E&P our us these we we're things Company. an of business. big, about on out where stand as

Operator

you. Thank

further back you. over to time. turn to the question Thank I'd Ellen. no at like call have you, We this

Ellen DeSanctis

Thank ring appreciate you Relations Thank really you if Be listeners. Have Senara. it. any to Investor I and you. free safe. our a wonderful day additional Terrific. have to Thank Feel week. comments.

Operator

concludes This you, thank and you for you, Thank participating. ladies today's gentlemen. and conference. Thank

now disconnect. may You

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