Q1 2024 Peyto Exploration & Development Corp Earnings Call

Operator: Good day, everyone, and thank you for standing by. Welcome to Paytel's first quarter 2024 financial results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To participate, you will need to press star 11 on your telephone. You will then hear a message advising you to raise your hand. To withdraw your questions, simply press star 11 again. Please be advised that today's conference is being recorded. Now, I would like to hand the conference over to the President and Chief Executive Officer, J.P. LaChanze. Please proceed.

Good day, everyone and thank you for standing by welcome to pay to US first quarter 2024 financial results Conference call. At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to participate you will need to press star.

Our one one on your telephone you will again hear a message of dicing. Your hand. This raced to withdraw your question simply press Star one again.

Please be advised that today's conference is being recorded.

Speaker Change: Now I would like to hand, the conference over to the President and Chief Executive Officer J P loves Hans Please proceed.

J.P. LaChanze: Thanks, Carmen. Good morning, folks, and thanks for joining Peyto's first quarter conference call. I'd like to remind everybody that all statements made by the company during this call are subject to the same forward-looking disclaimer and advisory set forth in the company's news release issued yesterday. Present with me in the room today to answer your questions are Riley Frame, our VP of Engineering and Chief Operating Officer, Tavis Carlson, our VP of Finance and CFO, Lee Curran, our VP of Drilling and Completions, Todd Burd Firstly, we'd like to thank the Peyto team, both in the office and on the field, for their contributions to a strong quarter.

Speaker Change: Thanks Carmen.

Speaker Change: Good morning, folks and thanks for joining <unk> first quarter conference call.

Speaker Change: Like to remind everybody that all statements made by the company. During this call are subject to the same forward looking disclaimer and advisory set forth in the company's news release issued yesterday.

Speaker Change: Present with me in the room today to answer your questions I Hope we.

We have really frame, our VP of engineering, and Chief operating Officer, David Carlson, our VP of finance and CFO Pat.

Speaker Change: Lee Curran, our VP of drilling and completions, Todd Burdick, our VP of production and Derek Zemba, our VP of land and business development.

J.P. LaChanze: And Q1 was a good quarter for Peyto despite low gas prices. We generated $205M of funds from operations and $100M of earnings, which in part has to do with our industry-leading cash costs but also thanks to a $93M hedging gain from our systematic hedging program that we put in place over the last two and a half years. This allowed us to not only fund our capital program of $114 million but pay our shareholders $64 million in dividends and also left us enough to pay down some debt, about $23 million of net debt over the quarter. We continue to be excited by the drilling results on the newly acquired Repsol lands.

Speaker Change: Firstly, we'd like to thank the payroll team both in the office and the field for their contributions to a strong quarter.

Speaker Change: In Q1 was a good quarter for Peyto, despite low gas prices, we generated $205 million of funds from operations and $100 million of earnings which.

Speaker Change: Which in part has to do with our industry, leading cash cost, but also thanks to our to our $993 million hedging gain for our from our systematic hedging program that we've put in place over the last two and a half years.

This allowed us to not only fund our capital program of $114 million, but they are shareholders $64 million in dividends and also left left left us enough to pay down some debt about 23 $23 billion of net debt over the quarter.

Speaker Change: We continue to be excited by the drilling results in the newly acquired Repsol Lance We had 15 wells on stream to the end of the quarter with.

J.P. LaChanze: We had 15 wells on stream to the end of the quarter with enough history to show us a sustained 30% increase in average well productivity as compared to the performance of recent wells and recent years on Peyto's legacy assets. This continues to affirm that the assets we bought last year have the quality we thought. We completed some very long lateral wells in the first quarter across all species. The longest quarterly program in our history, in fact, at an average length of about 2,200 meters.

Speaker Change: In our history that show us a sustained 30% increase of average well productivity as compared to the performance of recent wells recent years on it also.

Speaker Change: Legacy assets this.

Speaker Change: This continues to affirm that the assets we bought last year have the quality we thought they did.

Speaker Change: <unk>.

Speaker Change: We completed some very long lateral wells in the first quarter across all species.

Speaker Change: Longest quarterly program in our history in fact at an average average lengths of about 2200 meters and we continue to see the benefits of doing this to optimize resource recovery.

J.P. LaChanze: And we continue to see the benefits of doing this to optimize resource recovery. In Q1, we also drilled two 2,400-meter lateral Dunvegan wells that we subsequently brought on in April that demonstrate good deliverability, coupled with higher liquid content than our Spear River wells, about 20 to 30 barrels per million. It hasn't succeeded enough to dedicate a rig to the plate for the rest of the year.

Speaker Change: In Q1, we also drilled 220 400 meter lateral done vegan wells that we subsequently brought on in April that demonstrate good deliverability, coupled with higher liquid content in our spirit River wells about 20 to 30 barrels per million.

Speaker Change: It has us excited enough to dedicate a rig to the play for the rest of the year.

J.P. LaChanze: We have over 100 wells booked across our land base, and we expect to drill about 10 to 12 wells total in 2024. You can find a little more information about this in the April monthly report and in our corporate presentation, slide deck. Payload's focus on unit operating costs remains a priority, so much so that we set a target of at least a 10% reduction from Q1 levels by the end of the year. And we've already begun to make meaningful changes in this regard, beyond connecting gathering systems and plants together in the field.

Speaker Change: We have over 100 wells booked across our land based and we expect to drill about 10 to 12 wells.

Total in 2024.

Speaker Change: You can find a little more information about discipline in.

In the April monthly report and in our corporate presentation slide deck.

Speaker Change: Hey, let's focus on unit operating costs remain a priority. So much so that we set a target of at least a 10% reduction from Q1 levels by the end of the year.

And we've already begun to make meaningful changes in this regard beyond beyond connecting gathering systems together in the field.

J.P. LaChanze: The decision to no longer recover ethane via a third-party deep-cut plant fits to a T with our own control strategy. Paying someone else to extract low-value ethane from the gas phase doesn't make sense, especially when we can redirect a portion of that raw gas stream to our Edison gas plant, which helps dilute its higher fixed costs. We estimate that we will see about a $0.02 per MCFE reduction in overall operating costs going forward without any material loss in revenue.

Speaker Change: The decision to no longer recover ethane via a third party deep cut plant fits with our own to achieve with our own and control strategy.

Speaker Change: Paying someone else to extract low value assets from the gas space doesn't make sense, especially when we can redirect a portion of that broad upstream to our hedging gas plant, which helps to look at as higher fixed costs.

We estimate that we will see a lot of <unk> <unk> per Mcf reduction.

Speaker Change: Our overall operating costs going forward without any material loss of revenue.

J.P. LaChanze: We do lose about 2,000 barrels a day of low-value production from the base in the short term, but we expect to more than make up that loss by the year-end with the quality of the drilling program that we're executing. And this is a good example that, you know, we're running a business here to make money, not lower-value BOEs.

Speaker Change: We do lose about 2000 barrels a day of low value production from the base.

Speaker Change: On the short term, but we expect to more than make that up make up that loss by the year end with the quality of the drilling program that we're executing.

Speaker Change: And this is a good example that we're running a business here to make money not not lower value boe's.

J.P. LaChanze: We're still running 4 rigs right now, but we have them situated on 3 well pads for the most part through a breakup to minimize moves, and we'll be prudent on spending capital and bringing on production in the current low-price environment. That means we might wait on completions to keep costs down, and production ads will be delayed accordingly. We have varying levers we can pull to reduce capital should low prices prevail past the summer.

Speaker Change: We're still running four rigs right now, but we have them situated on three well pads for the most part through a breakup through breakup to minimize moves and we will be prudent on spending capital and bringing on production in the current low price environment.

Speaker Change: That means we might wait on completions to keep cost down and production adds will be delayed accordingly.

We have varying levers, we can pull to reduce capital should low prices prevailed as the summer.

J.P. LaChanze: I know many are wondering about the status of the Cascade Power Plant and when we're going to start selling gas to them under our contract. As a reminder, that contract is for 60,000 GJs a day or about 52 million cubic feet a day over the next... 15 years, and it will start once they are fully operational. We have pressured up our pipeline that connects the gas roughly to their plant, and we're ready to go.

Speaker Change: I know many are wondering about the status of the Cascade power plant and when we're going to start selling gas to them under our contract as a reminder, that contract is for 60000 DJ today are about 52 million cubic feet a day over the next.

15 years and it will start once they are fully operational.

Speaker Change: We have pressured up our pipeline that connects gas roughly to their plan and we're ready to go.

J.P. LaChanze: Based on publicly available data, both plants have been generating some power and are making commissioning progress, so that's a good sign. The latest filing with the Alberta Utilities Commission for startup is in July of 2024. When we look past Summer 2024 and into 2025, we're excited about the LMGE egress build-out which is coming over the next few years. By the end of the decade, Canada and the U.S. should be exporting at least another 12 BCF a day.

Speaker Change: Based on publicly available data both plants have been generating some power and are making commissioning progress. So that's a good sign.

Speaker Change: The latest filing with the spirit of Utilities Commission for startup is in July of 2024.

Speaker Change: When we look past summer 'twenty forward into 2025, we are excited about the LNG egress Buildout, which is coming over the next few years by the end of the decade, Canada and U S should be exporting at least another 12 Bcf a day.

J.P. LaChanze: Besides that, there's significant demand potential that could be borne out of the evolution of AI with increased power requirements for data centers. We all know that natural gas is safe, secure, clean, and affordable, but most importantly, it is a reliable supply of energy for people.

Speaker Change: Besides that there is significant demand potential that could be borne out of the evolution of AI with with increased power requirements for data centers.

Speaker Change: We all know that natural gas is safe secure clean and affordable, but most importantly, it is a reliable supply of energy for the future.

J.P. LaChanze: In the meantime, while all that comes to fruition, Peyto is well-protected with our low-cost structure, our disciplined hedging policy, and our quality drilling inventory to thrive in 2024. This gives us confidence to execute a measured capital program, sustain dividend payments to shareholders, and still allow us to manage the balance sheet with repayments of debt over the course of the year. Okay, I'll keep this short, but just a reminder, our AGM is next week on Wednesday, May 22nd at 3 p.m. in the building at our Calgary office on the plus 15 level in the conference center.

Speaker Change: In the meantime.

Speaker Change: All while all of that comes to fruition Pedro is well protected with our low cost structure, our disciplined hedging policy and.

Speaker Change: Our quality drilling inventory to thrive in 2024.

This gives us confidence to execute a measured capital program sustained sustained dividend payments to shareholders and still allow us to manage the balance sheet with repayments of debt over the course of the year.

J.P. LaChanze: We hope to see you there. If you can't make it, we'll be posting a recording of it on our website afterwards, but please vote for your shares. If you need help with that, you can see our press release for instructions. Okay, again. I like to keep this short.

Speaker Change: Yes.

Speaker Change: Okay I'll keep this short, but just a reminder, our AGM is next week on Wednesday may 22nd at <unk> in our new building in our in our Calgary office on the plus.

The level and the corporate center, we hope to see there.

Speaker Change: If you can't make it we'll be posting on our reporting on.

Speaker Change: I have it on our website afterwards, but please vote your shares.

Speaker Change: If you could help us out you can see our press release for instructions.

Operator: So maybe I'll go to the phones. Carmen, if there are any questions there, if not, I can go to some questions we have. Thank you. I don't see any questions at this time, but as a reminder, if you do have a question, simply press star 11 to get in the queue. I see one question from the phone. How do you want to proceed? Go ahead, and we'll allow you. All right.

Speaker Change: Okay.

Speaker Change: I'll keep this short so maybe ill go to the phones Carmen presented questions. There if not I can go to some questions we have.

Speaker Change: That came in overnight.

Speaker Change: I don't see any questions at this time, but as a reminder, if you do have a question simply press star one one to get in the queue.

Speaker Change: One question is on the phone how do you want to proceed.

Speaker Change: And then we will.

Speaker Change: Thank you one moment, while we bring it to the stage.

Operator: From Chris Thompson with CIBC, Please proceed.

Speaker Change: From Chris Thompson with CIBC. Please proceed.

Christopher Thompson: Hey, good morning, everyone. Thanks for taking my question this morning. First question for you, just on the transportation costs in your release, you mentioned you've seen an increase in tolls on NGTL and an increase in costs related to transportation with your Q1 results. Just wondering how we should think about that trending for the rest of the year.

Speaker Change: Hey, good morning, everyone. Thanks for taking my question this morning.

Speaker Change: First question for you just on the transportation costs.

Speaker Change: In your release you mentioned.

Speaker Change: <unk> seen an increase in total <unk> an increase in costs related to transportation with your Q1 results I'm just wondering how we should think about that trending for the rest of the year.

Tavis Aaron Carlson: Hey Chris, it's Tavis Carlson here. Yeah, we came out at $0.30 per MCFE in the quarter. I think you could use that going forward for the rest of the year. I think in 2023, we're at 27 cents, so we're up about 3 cents year over year. 30 tenths is a good number to estimate for the rest of the year.

Tavis Aaron Carlson: Hey, Chris It's Cabot's Carlson here.

Tavis Aaron Carlson: Yes, we came out at <unk> 30 per Mcf in the quarter.

Tavis Aaron Carlson: And I think you could use that going forward for the rest of the year I think 2023 were 27.

Speaker Change: We're up about three year over year here at <unk>.

Speaker Change: <unk> is a good number.

Speaker Change: For the rest of the year.

Christopher Thompson: Got it. Okay, thank you. And then my next question, just in terms of free cash flow for the balance of the year, I'm wondering if you can help us sort of triangulate where you see your free cash flow profile going in the balance of 24.

Speaker Change: Got it okay. Thank you and then my next question just.

Speaker Change: In terms of free cash flow for the balance of the year.

Speaker Change: I'm wondering if you can help us sort of triangulate, where you see your free cash flow profile.

Speaker Change: And in the.

The balance of 'twenty four.

Tavis Aaron Carlson: We don't typically give specifics on that, but generally speaking, with prices a little bit lower here in the next two quarters, we'll see that come down. Obviously, cash flow will come down in general, and so that might mean we accumulate a small amount of debt over those terms. But in Q4, we have higher prices, and of course, on the strip, but also in our hedge book, which is in the press release, and so we'll see an equal paydown of debt over the year. We'll see cash flow that we generate, obviously. Add any free cash that we have and, of course, sustain the dividend as well throughout that period, and you have a reasonable problem.

Speaker Change: Well, we don't typically guide specifics on that but generally speaking we will we always prices a little bit lower here in the next two quarters, we'll see that come down obviously cash flow will come down in general.

Speaker Change: And so that might mean EMEA accumulators.

Speaker Change: Small amount of debt over those terms for Q4, we have stronger prices and of course on strip, but also edge and our hedge book.

Speaker Change: Which is in the press release, and so we will see a meaningful pay down of debt over the year. So.

Speaker Change: Free cash flow that would generate obviously.

Speaker Change: Any free cash that we have and of course sustaining the dividend as well throughout that period.

Speaker Change: Problem.

Christopher Thompson: Okay, thank you. And then on the production profile, just the loss of 2,000, I guess that would be 2,000 barrels of ethane production a day from your base, but then you mentioned you're going to make up for it by year end. So, I understand your exit rate is unchanged, but should we think about, you know, if we were modeling a certain number before this change, would we see our full year average come down 2,000 barrels a day, or what should we think about? I am really just modeling this out.

Speaker Change: Okay. Thank you and then on the production profile just the loss of 2000, I guess that would be 2000 barrels a day of ethane production from your base.

Speaker Change: But then you mentioned youre going to make up for it by year end. So if I understand your exit rate is unchanged.

Speaker Change: But should we think about.

Speaker Change: If we are modeling.

Speaker Change: A certain number before.

Speaker Change: This change would we would we see our full year average.

Speaker Change: Come down 2000 barrels a day or how should we think about.

Speaker Change: Really just modeling this out.

Tavis Aaron Carlson: I'd say in the first, second, third quarter, maybe it continues for that period of time, you'll see a reduction in whatever you had in your model by about 2,000 barrels a day of production. You shouldn't see a change in your revenue; in fact, you should see cash flow go up because we are going to reduce operating costs by, like I said earlier, two cents. So you should bottle something slightly less on the obviously 2000 barrels a day, less in the short term.

Speaker Change: I would say in the first like second quarter third quarter, maybe it continues for that period of time, you will see a reduction of whatever you have in your model by about 2000 barrels a day.

Speaker Change: Production you Shouldnt see a change in Europe. Your revenue track you should see cash flow go up because we are going to reduce operating costs by like I said earlier too.

Speaker Change: So you should model something slightly less on the on the <unk>.

Speaker Change: Obviously 2000 barrels a day less in the short term but.

Tavis Aaron Carlson: But depending on the timing of all the production ads we have, which would be Q3, Q4 mainly and corresponding with higher prices, will more than make up for that 2000 barrels a day. So it'll be caught up in say Q3, Q4 in that range, somewhere in there.

Speaker Change: Depending on the timing of all that production as we how it should be Q3 Q4, mainly.

Speaker Change: Corresponding with higher prices.

Speaker Change: More than make up for that 2000 barrels a day so it will be.

Speaker Change: Caught up in say Q3, Q4 in that range somewhere in there.

Christopher Thompson: Great, thanks. I'll hand it back.

Speaker Change: Great. Thanks, I'll hand, it back okay.

J.P. LaChanze: Okay, thanks for your questions, Chris.

Speaker Change: Okay. Thanks for your questions Chris.

Operator: Thank you. You may continue. I don't see any questions.

You May continue I don't see any questions at this time.

J.P. LaChanze: Thanks. I'm going to take a couple of questions that came in over the wire there last night. Maybe this one's for Riley.

Speaker Change: Okay. Thanks, I'm going to take a couple of questions that came in over the over the wire there last night, maybe this one's probably for Riley.

J.P. LaChanze: We talked about the 30% improvement in our well results. You know, we're very happy with them, what we expected, or maybe it's even a little better than we expected. Can you maybe elaborate some more around, you know, maybe what are the costs associated with these wells and, you know, how are we predicting our F&D, and those sort of things are a little more color maybe around that program? Yes, thanks JB. Yeah, so obviously, the performance of the wells on the REPSOL lands has been excellent.

Riley: We talked about the 30% improvement on our well results.

Riley: Yes.

Happy with them.

Riley: We expected or maybe even a little better than we expected can you maybe elaborate some more around maybe what are the costs associated with these wells and how we predicting where F&B and thats sort of things are a little more color maybe around that program.

Debbie: Yes, Thanks Debbie.

Speaker Change: Yes, so obviously the performance of the wells on the Repsol lands and have been excellent as you mentioned, 30%.

Riley Millar Frame: All ends have been excellent, as you mentioned, 30% over last year's program on average, which is great. From a cost perspective, everything's coming in in line with what we would expect. Average cost for the quarter, about $4.8DNC. Repsol costs were actually just a little bit below that, at $4.7M per well, even though we're actually drilling those wells slightly longer, roughly 15%.

Speaker Change: Over last year's program on average which is great.

Debbie: From a cost perspective.

Debbie: Everything is coming in in line with what we would expect.

Debbie: Average cost for the quarter of about $4 eight D&C. The repsol costs were actually just a little bit below that at $4 7 million per well.

Speaker Change: Even though we're actually drilling those wells slightly longer roughly 15% so.

Riley Millar Frame: Based on the data we have right now, to forecast these wells, we're predicting an F&D of around $0.95, which is really good. It actually is right in line with what we're seeing from our reserve process this year. That's all really positive. I would actually expect that that F&D number here will drop even a little bit further throughout the course of the year as we feather in more punchy, not acute, locations. As we move through the second half here, we've been able to digest a bunch of the seismic that we picked up late last year, and there's a suite of really high-quality, not acute, locations that we'll be drilling in the second half, so I expect those numbers to improve in the second half of the year as well.

Based on the data we have right now to forecast. These wells, we're predicting an F&D around 95 sandwiches, which is really good.

Speaker Change: And actually is right in line with what we're seeing from our from our bookings from our reserve process. This year. So.

Speaker Change: So yeah, that's all really positive and I would actually expect that that F&D number here.

Speaker Change: Well, both dropping a little bit further throughout the course of the year as we feather in more punchy non acute locations.

Speaker Change: As we as we move through the second half year, we've been able to digest a bunch of the seismic that we picked up late last year and there is a.

Speaker Change: We are preserving quality locations that will be drilling in the second half so I expect those numbers to improve.

Speaker Change: Yes.

J.P. LaChanze: That's encouraging. Thanks for that, Culler. Todd, I also have some questions about our preparedness for, you know, for wildfire season. We saw some smoke rolling over the weekend in Calgary. As a reminder, it is that time. We've heard about evacuations already in some areas. Maybe you could elaborate on what we learned last year and maybe what we've done or how we will mitigate any impacts from that. It's one of the common questions I'm getting these days.

That's encouraging.

Speaker Change: Thanks for that color.

Speaker Change: So I would also have some questions around.

Speaker Change: Our preparedness for gel for wildfire season, we saw some smoke rolling over the weekend and calibrate as a reminder, it is that time, we've heard from shrink lot evacuations already some areas may.

Speaker Change: If you could elaborate on what we learned last year in <unk>.

What we what we have done it.

Speaker Change: How we will mitigate any impacts from that it's one of the common questions I'm getting these days.

Todd Burdick: As far as key learnings last year go, we did learn that we can operate our gas plants remotely for short periods of time, but we can't do that with the Edson gas plant, a fairly large facility and a little more complex to operate. But we can run them for a short period of time. Cut off of access is a pretty key issue where, you know, obviously, if we can't get into a certain area due to an evacuation or something like that, then you've got water tanks that are filling up sort of thing.

Speaker Change: Yes sure.

Speaker Change: So as far as key learnings last year.

Speaker Change: We did learn.

Speaker Change: Excuse me.

Speaker Change: Yes, there are gas plants, we can operate them remotely for.

Speaker Change: Short periods of time.

Obviously do that with the gas plant.

Speaker Change: Fairly large facility and a little more complex to operate.

Speaker Change: But we can run them for a short period of time.

Speaker Change: Cut off of access.

Speaker Change: The key issue.

Speaker Change: Obviously, if we can get into a certain area due to an evacuation or something like that.

Todd Burdick: So, again, you can run for a short period of time, but we can remotely shut down wells, which helps. So we try and keep things going as long as we can. And we did that in certain situations last year.

Speaker Change: And <unk> got water tanks that are filling up.

Speaker Change: That sort of thing. So so again you can you can run very short period of time, but we can remotely shut wells in which helps so try.

Speaker Change: Try and keep things going as long as we can and we did that in certain situations last year.

Todd Burdick: Liquid trucking egress is a main concern that affects many of our plants. Right now, about 68% of our liquids move on pipes to sales. As long as those plants are linked together, especially in the Sundance area and as well down in Greater Grasau. As we've been talking about since the acquisition, we've worked to connect the Repsol plants in the Greater Sundance area as well. So that gives them flexibility to move production around if needed, you know, if a fire should approach a particular part of that Greater Sundance or Greater Brazos area.

Speaker Change: Liquid trucking each egress is a main concern that affects many of our plants.

Speaker Change: Right now about 68% of our liquids move on pipes to sales.

As long as those.

Speaker Change: Facilities that are on the other end of those keep moving then we can move a large volume of fluid but.

Speaker Change: <unk> has moved out on trucks.

Speaker Change: Some a little bit of risk that we that we see.

Speaker Change: As far as mitigation, obviously, we talk about it quite a bit we've got a lot of plants linked together.

Speaker Change: Especially in the Sundance area, and as well down in greater Brasow.

Speaker Change: As we've been talking about since the acquisition we've worked too.

Speaker Change: Connect.

Speaker Change: The repsol plants in the greater Sundance area as well, so so that gives us flexibility to move production around if needed.

Speaker Change: We have a fire should approach a particular part of that greater Sundance or greater Brasow area.

Todd Burdick: We, you know, we've cleared our areas around plants where maybe trees were a little bit closer, closer than we felt comfortable with. We looked at all of the former Repsol plants, and there were no issues there.

Speaker Change: We've cleared or areas around.

Speaker Change: Plants, where maybe trees were a little bit close closer than what we felt comfortable with.

Speaker Change: We looked at all of the Rep salt former repsol plants.

Speaker Change: There was no issues there.

Todd Burdick: Obviously, I mentioned the liquid pipelines. When fires start to get near the area, We start looking at things like pulling kink levels down at plants and LPD levels and that sort of stuff just to be able to to run a little bit longer. And then obviously we installed cameras last year so we've got cameras at all of the plants and so that we've got 360 degree views just to see and make sure that fires aren't getting too close so we can get people out if need be quickly and then we can even our propane refrigeration plants we can always warm up make less liquid put it in the gas phase so that we can stretch out that time while tanks are filling so you know I guess the final thing would be we learned last year that good communication with fire liaisons is really important at times we were talking to them a couple times a day they were really good at sending information to us that allowed us to feel confident that we are protecting our people and we're not going to get anybody caught where they shouldn't be.

Speaker Change: Obviously I mentioned the liquids pipelines.

Speaker Change: And fires start to get near the area in it.

Speaker Change: We start looking at things like pulling tank levels down at plants in LPG levels in that sort of stuff just to.

Speaker Change: Be able to.

Speaker Change: To run a little bit longer.

Speaker Change: And then obviously we installed.

Speaker Change: Cameras last year, so we've got cameras that all of the plants.

Speaker Change: So that we've got 360 degree views just to see and make sure that buyers are getting too close so we can get people out.

<unk> quickly and then re queue.

Speaker Change: Given our propane refrigeration plants, we can always warm up make less liquid.

Speaker Change: Put it in the gas phase so that we can stretch out that.

Speaker Change: That time, well takes are failing.

Speaker Change: So.

I guess the final thing would be.

Speaker Change: We learned last year that good communication with fire liaisons is really important at times, we were talking to them a couple of times a day they were really good at spending.

Speaker Change: Information to us.

Speaker Change: That allowed us to feel confident that we.

Speaker Change: Our protecting our people and we're not going to get anybody caught where they shouldnt be so odd.

Todd Burdick: So obviously, that would be something if fires came close; we'd be reaching out to those people right away, both fire liaisons with industry and with the Alberta government. So, we feel pretty good that should something come our way, we learned a lot last year and made a few changes to what we did. And I think, hopefully, we don't have to go there, but if we do, we're ready.

Speaker Change: Obviously that will be something buyers come close we be reaching out to those people right away.

But buyer liaisons with industry and with the Alberta government.

Speaker Change: So we feel pretty good that should something come our way, we learned a lot last year.

Speaker Change: Made a few changes of what we've done.

And I think.

Speaker Change: Hopefully we don't have to go there, but if we do.

Speaker Change: We're ready.

J.P. LaChanze: Thank you. Thank you for that. I think it's important for folks to understand that we do have a... Owning and controlling our facilities is a real advantage for us to be able to take, you know, to be able to do these kinds of things, right, to be able to make the changes we need to in situations like this.

Speaker Change: As we can be.

Speaker Change: Thank you for that I think it's important for folks to understand that we do.

Speaker Change: Bernie owning and controlling our facilities as a real advantage for us to be able to take.

Speaker Change: To be able to do these kinds of things right to fill to make.

Speaker Change: The changes we need to situations like this okay.

J.P. LaChanze: Okay, I don't have any more questions. If there are no questions on the call, are there any more questions? All right, to our tele audience.

Any more questions.

Speaker Change: There are no questions on the call is there any more questions.

Operator: All right, to our tele-audience. As a reminder, that is star 11 if you do have a question. One moment.

Speaker Change: Alright, alright tailored audience as a reminder, that is star one one if you do have a question from Amit.

Operator: I don't see any further questions. I'll turn it back to J.P. Lachance for final comments. Okay, well, thanks for tuning in, folks. I hope to see you soon...

Speaker Change: I don't see any further questions I'll turn it back to J P. Sean for final comments.

J.P. LaChanze: Okay, well, thanks for tuning in, folks. I hope to see you at the AGM next week, but if not, we'll talk again next quarter.

Speaker Change: Okay, well, thanks for today and folks I hope to see you at the AGM next week, but if not we'll talk again next quarter. Thanks for tuning in.

Speaker Change: Yeah.

Operator: Thank you, everyone. You may now disconnect.

Speaker Change: Thank you everyone you may now disconnect.

Speaker Change: [music].

Speaker Change: Okay.

Speaker Change: Okay.

Speaker Change: Sure.