Q2 2024 Suncor Energy Inc Earnings Call

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Operator: Good day, and welcome to the Suncor Energy 2nd Quarter 2024 Financial Results 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 ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker, Suncor Energy's Vice President, Mr. Troy Little. Mr. Little, the floor is yours.

Speaker Change: Good day and welcome to the Suncor energy second quarter 2024 financial results call.

Speaker Change: At this time all participants are in a listen only mode. After the speaker presentation. There will be a question and answer session to ask a question. During the session you will need to press star one one on your telephone you will then hear an automated message advising your hand is raised to withdraw your question Press Star. One again, please be advised that today's conference.

Speaker Change: Is being recorded I would now like to hand, the conference over to your Speaker Suncor Energy's Vice President Mr. Choi Little Mr. Little the floor is yours.

Operator: Thank you, operator, and good morning. Welcome to Suncor Energy's second quarter earnings call. Please note that today's comments contain forward-looking information. Actual results may differ materially from the expected results because of various risk factors and assumptions that are described in our second quarter earnings release, as well as in our current annual information form, both of which are available on SEDAR, EDGAR, and our website, suncor.com. Certain financial measures referred to in these comments are not prescribed by Canadian generally accepted accounting principles. For a description of these financial measures, please see our second quarter earnings release.

Troy Little: Thank you, operator, and good morning. This is Suncor Energy's second quarter earnings call. Please note that today's comments contain forward-looking information. Actual results may differ materially from the expected results because of various risk factors and assumptions that are described in our second quarter earnings release, as well as in our current annual information form, both of which are available on CDAR, EDGAR, and our website, suncor.com. Certain financial measures referred to in these comments are not prescribed by Canadian Generally Accepted Accounting Principles.

Speaker Change: Thank you operator, and good morning, welcome to Suncor Energy's second quarter earnings call. Please.

Speaker Change: Please note that today's comments contain forward looking information.

Speaker Change: Actual results may differ materially from the expected results because of various risk factors and assumptions that are described in our second quarter earnings release as well as in our current annual information form both of which are available on SEDAR, Edgar and our website Suncor Dot com.

Speaker Change: Certain financial measures referred to in these comments are not prescribed by Canadian generally accepted accounting principles for a description of these financial measures. Please see our second quarter earnings release, we will start with comments from rich Kruger, President and Chief Executive Officer, followed by Chris Smith, <unk> Chief Financial Officer also.

Troy Little: For a description of these financial measures, please see our second quarter earnings release. We will start with comments from Rich Kruger, President and Chief Executive Officer, followed by Chris Smith, Suncor's Chief Financial Officer. Also on the call are Peter Zebedee, Executive Vice President, Oil Sands, and Shelley Powell, Senior Vice President, Operational Improvement and Support Services. Following the formal remarks, we'll open up the call to questions. Now, I'll hand it over to Rich to share his comments.

Operator: We will start with comments from Rich Krueger, president and chief executive officer, followed by Chris Smith, Suncor's chief financial officer. Also on the call are Peter Zebedee, executive vice-president, oil sands, and Shelley Powell, senior vice-president, operational improvement and sports services.

Speaker Change: On the call are Peter Zebedee Executive Vice President oil Sands, and Shelly Powell Senior Vice President operational improvement and support services.

Operator: Following the formal remarks, we'll open up the call to questions. Now I'll hand it over to Rich to share the comments.

Speaker Change: Following the formal remarks, we will open up the call to questions now I'll hand, it over to rich to share his comments. Thanks, Mike.

Rich Kruger: Thanks, Troy. Good morning.

Richard Kruger: Thanks, Roy. Good morning. Following a strong first quarter, our second quarter was about execution and momentum: execution of major turnaround activities and momentum in targeted improvement areas. Chris will detail the quarter here in a few moments, but I'll start with some color commentary, beginning with a recap of our May 21st Investor Day. May 21st was about unveiling today's Suncore in its ambitions, a company committed to consistently deliver high performance. May 21st was also about backing up our words with a growing list of proof points to build trust and credibility, trust in our company and credibility in our management.

Rich Kruger: Following a strong first quarter, our second quarter was about execution and momentum. Execution of major turnaround activities, and momentum in targeted improvement areas. Chris will detail the quarter here in a few moments, but I'll start with some color commentary by beginning with a recap of our May 21st investor presentation. May 21 was about unveiling today's Suncor and its ambitions, a company committed to consistently delivering high performance. May 21 was also about backing up our words with a growing list of proof points to build trust and credibility, trust in our company and credibility in our management. In terms of key messages, I'll highlight three.

Rich Kruger: Following a strong first quarter, our second quarter was about execution and momentum.

Speaker Change: <unk>, a major turnaround activities and momentum in targeted improvement areas, Chris will detail the quarter here in a few moments, but I'll start with some color commentary with the beginning with a recap of our May 21 Investor day.

Chris: May 'twenty, one was about unveiling today's suncor and its ambitions a company committed to consistently deliver high performance.

Chris: May 'twenty. One was also about backing up our words with a growing list of proof points to build trust and credibility trust in our company and credibility in our management in terms of key messages I will highlight three first with across the board improvements and a 100 plus thousand barrels a day of <unk>.

Richard Kruger: Management.

Richard Kruger: In terms of key messages, I'll highlight three. First, with across-the-board improvements and a hundred-plus thousand barrels a day of increased production, we intend to grow three funds flow by greater than $3 billion per year by 2026. Second, aligned with stronger performance, we're now allocating 75% of excess funds to share buybacks and have increased our net debt target for moving to 100%. Third, with growth from within existing assets and a wealth of long-term internal options, there will be no significant capital directed to new Richmond development in the next five years.

Rich Kruger: First, with across the board improvements and a hundred plus thousand barrels a day of increased production, we intend to grow free funds flow by greater than three billion dollars per year by 2026. Second, aligned with stronger performance, we're now allocating 75% of excess funds to share buybacks and have increased our net debt target for moving to 100%. With growth from within existing assets and a wealth of long-term internal options, there will be no significant capital directed to new bitumen development in the next five years.

Speaker Change: Increased production, we intend to grow free funds flow by greater than $3 billion per year by 2026.

Chris: Second aligned with stronger performance, we're now allocating 75% of excess funds to share buybacks and have increased our net debt target for moving to a 100%.

Chris: Third with growth from within the existing assets and a wealth of long term internal options. There will be no significant capital directed to new bitumen development in the next five years.

Richard Kruger: Lastly, on May 21st, we discussed culture, competitive results-oriented, high performance, a culture being institutionalized within Suncor today. I'll turn to the second quarter, starting with safety, where we continue to achieve exceptional results, particularly impressive with high turnaround activity and a seasonally high number of contractors on site. Our safety performance is a credit to our people, processes, priorities, and site leadership.

Rich Kruger: Lastly, on May 21, we discussed culture, competitive, results-oriented, high performance, a culture being institutionalized within Suncor today. I'll turn to the second quarter, starting with safety, where we continue to achieve exceptional results, particularly impressive with high turnaround activity and a seasonally high number of contractors on site. Our safety performance is a credit to our people, processes, priorities, and site leadership. I'll move on to reliability. Chris will detail the second quarter.

Chris: Lastly on May 21, we discussed culture competitive results oriented high performance, our culture being institutionalized within Suncorp today.

Speaker Change: I'll turn to the second quarter, starting with safety, where we continue to achieve exceptional results, particularly impressive with high turnaround activity and seasonally high number of contractors on site are.

Chris: Our safety performance is a credit to our people processes priorities and site leadership.

Richard Kruger: I'll move on to reliability. Crystal detailed the second quarter. I'd like to reflect on the first half. Refining throughput in the first half is $443,000 a day of $62,000 a day, or 16% from the first half of last year. It represents our best first half in company history, in our second best second quarter in company history. The results were driven by a 95% overall utilization rate in the first half versus 82% in the first half of last year. Achieved despite major turnarounds at both Sarnia and Montreal, Edmonton, our moneymaker, and its best-ever utilization of 107% in the first half.

Chris: I'll move on to reliability, Chris will detail the second quarter I'd like to reflect on the first half.

Rich Kruger: I'd like to reflect on the first half. Refining throughput in the first half was 443,000 barrels a day, up 62,000 barrels a day or 16% from the first half of last year. It represents our best first half in company history and our second best second quarter in company history. The results were driven by a 95% overall utilization rate in the first half, versus 82% in the first half of last year, achieved despite major turnarounds at both Sarnia and Montreal.

Chris: Finding throughput in the first half 443000 barrels a day up 62000 barrels a day or 16% from the first half of last year.

Chris: It represents our best first half in company history.

Chris: And our second best second quarter in company history.

Chris: The results were driven by a 95% overall utilization rate in the first half.

Chris: Versus 82% in the first half of last year.

Chris: Achieved despite major turnarounds at both Sarnia and Montreal Edmonton are moneymaker had its best ever utilization of 107% in the first half.

Rich Kruger: Edmonton, our moneymaker, had its best ever utilization of 107% in the first half, refined product sales in the first half of 588,000 barrels a day, up 57,000 barrels a day, or 11% from the first half of last year. Again, the best first half in company history and the best second quarter in history. The first and second quarters were back-to-back record highs for refined products, and upstream production in the first half of the year was 803,000 barrels a day, up 61,000 barrels a day or 8% versus the first half of last year. Again, this was the best first half in company history and the second best second quarter in our history. Multiple asset-specific records were set.

Richard Kruger: Refined product sales in the first half were $588,000 a day, up $57,000 a day or 11% from the first half of last year. Again, the best first half in company history and the best second quarter in history. The first and second quarters were back-to-back record highs for refined product sales. Upstream production, the first half, $803,000 a day of $61,000 a day or 8% versus the first half of last year. Again, the best first half in the company history and second best second quarter in our history. Multiple asset-specific records were set, but I want to highlight one particular note where the accomplishment upgrade or utilization at 94% in the first half with a very impressive 99% at the base plan.

Chris: Refined product sales in the first half were 588000 barrels a day up 57000 barrels a day or 11% from the first half of last year again, the best first half in company history, and the best second quarter in history.

Chris: The first and second quarters, we're back to back record highs for refined product sales.

Chris: Upstream production the first half 803000 barrels a day up 61000 barrels a day or 8% versus the first half of last year again, the best first half in the company history and second best second quarter in our history.

Rich Kruger: But I want to highlight one particular noteworthy accomplishment, upgrader utilization at 94% in the first half, with a very impressive 99% at the base plant, despite turnarounds completed in the second quarter. And for context on our upgraders, our opex on upgraders is about six to $7 a barrel Canadian. These behemoths print money; we get a value uplift of about $15 a barrel US.

Chris: <unk> asset specific records were set but I want to highlight one one particular noteworthy accomplishment upgrader utilization at 94% in the first half with a very impressive 99% at the base plant.

Richard Kruger: Despite turnarounds completed in the second quarter and for context that are upgrades, our off-ex on upgrades are about $6 to $7 a barrel, Canadian. These behemoths print money. We get a value uplift of about $15 a barrel U.S. So every 1% increase in utilization adds about $20 million a year in free funds flow. Last year we had a record annual utilization of 92% for the whole year, and at the first half of this year we're at 94% despite the sincrued turnaround activity. So some of our first half reliability was exceptional. Again, it's a credit to our people, their expertise, their focus, teamwork, and determination.

Chris: Despite turnaround turnarounds completed in the second quarter and for contact center upgrades or Opex on upgrades are about six to $7 a barrel Canadian these behemoths print money, we get a value uplift of about $15 a barrel U S. So every 1% any.

Rich Kruger: So every 1% increase in utilization is about $20 million a year in free funds flow. Last year, we had a record annual utilization of 92% for the whole year. And in the first half of this year, we're at 94% despite the Syncrude turnaround activity. So in summary, our first half reliability was exceptional. Again, it's a credit to our people, their expertise, their focus, teamwork, and determination.

Speaker Change: Kris and utilization adds about $20 million a year in free funds flow.

Chris: Last year, we had a record annual utilization of 92% for the full year.

Chris: The first half of this year were at 94%. Despite the same syncrude turnaround activity. So a summary of our first half reliability was exceptional again, it's a credit to our people and their expertise their focus teamwork and determination.

Rich Kruger: Chris will cover overall profitability shortly. I'd like to comment on one aspect of it, cost management. In the first half of 2024, total OS and G revenue, all in, top to bottom, $6.6 billion, down 270 million or 4% versus the first half of last year. That's positive enough.

Richard Kruger: Profitability; Chris will cover overall profitability shortly. I'd like to comment on one aspect of it: cost management. In the first half of 2024, total OSNG, all in top to bottom, $6.6 billion. Down 270 million or 4% versus the first half of last year. That's positive enough; however, in the first half. As I mentioned, upstream production was $61,000 a day higher, refining throughput, $62,000 a day higher, and refine product sales, $57,000 a day higher than the first half of last year. Higher absolute volumes, lower absolute costs, operating leverage. In fact, every segment of our business upstream, downstream, corporate operated at lower absolute and/or unit costs in the first half of this year versus the same period last year, every segment.

Chris: Profitability, Chris will cover overall profitability shortly I would like to comment on one aspect of it cost management in the first half of 2024 total OS and G. All in top to bottom six $6 billion.

Chris: Down $270 million or 4% versus the first half of last year.

Chris: That's positive enough. However in the first half as I mentioned upstream production was 61000 barrels a day higher refining throughput 62000 barrels a day higher than refined product sales 57000 barrels a day higher than the first half of last year higher absolute volumes.

Rich Kruger: However, in the first half, as I mentioned, upstream production was 61,000 barrels a day higher, refining throughput was 62,000 barrels a day higher, and refined product sales were 57,000 barrels a day higher than the first half of last year. Higher absolute volumes, lower absolute costs, and operating leverage. In fact, every segment of our business, upstream, downstream, and corporate, operated at lower absolute and or unit costs in the first half of this year versus the same period last year.

Chris: Lower absolute costs operating leverage in fact every segment of our business upstream downstream corporate operated at lower absolute <unk> unit costs in the first half of this year versus the same period last year every segment.

Richard Kruger: Cost management is about discipline and accountability, attention to detail, a mindset that every dollar matters, and a checkbook-like mentality. At today's Suncor, we don't spend money like it's our own. We spend it like it's someone else's, and we are accountable for every dollar we spend.

Rich Kruger: Cost management is about discipline and accountability, attention to detail, a mindset that every dollar matters, a checkbook-like mentality. At today's Suncor, we don't spend money like it's our own. We spend it like it's someone else's, and we are accountable for every dollar we spend. A disciplined, determined, cost-conscious culture. Now, I'll move to the second quarter.

Chris: Cost management is about discipline and accountability attention to detail a mindset that every dollar matters, a checkbook like mentality and today's suncor, we don't spend money like it's our own we'd spend it like it's someone else's and we are accountable for every dollar we spend a discipline.

Richard Kruger: A discipline, determined, cost-conscious culture.

Chris: Determinate determined cost conscious culture.

Richard Kruger: I'll move to the second quarter. During our May 21st review, and on previous earnings calls, we detailed numerous improvement plans. I'll provide an update on a few this morning, starting with turnaround. I previously described or stated that the second quarter would be our biggest turnaround quarter in 2024, with about 80% of the year's activity plan. Recall we spend about $1.2 billion per year on turnaround across the upstream and downstream. In North America, we have not benchmarked well on both cost and schedule. In the third quarter of last year, we formed a dedicated turnaround organization and assigned ELT-level accountability with Shelley Powell and Dave Oledreef.

Rich Kruger: During our May 21st review and on previous earnings calls, we detailed numerous improvement plans. I'll provide an update on a few this morning, starting with turnaround. I previously described or stated that the second quarter would be our biggest turnaround quarter in 2024, with about 80% of the year's activity planned. Recall, we spend about $1.2 billion per year on turnarounds across the upstream and downstream. And in North America, we have not benchmarked well on both cost and schedule. In the third quarter of last year, we formed a dedicated turnaround organization and assigned ELT level accountability to Shelley Powell and Dave Oldreive. So the second quarter is complete; how did we do?

Speaker Change: I'll move to the second quarter during our May 21st review and on previous earnings calls, we detailed numerous improvement plans I'll provide an update on a few this morning, starting with turnarounds I. Previously described our stated that the second quarter would be our biggest turnaround quarter in 2000.

Chris: <unk> 24, with about 80% of the year's activity plant recall, we spend about $1 $2 billion per year on turnarounds across the upstream and downstream and in North America, we have not benchmarked well on both cost and schedule.

Shelley Powell: In the third quarter of last year, we formed a dedicated turnaround organization and assigned ELT level accountability with Shelley Powell and gave us grief.

Richard Kruger: So the second quarter is complete. How did we do? Four big events, two upstream, synchroode-based plan, two downstream, Sarnia and Montreal. We completed an aggregate all of our turnaround on budget in a whopping 10% shorter iteration. 10% equates to roughly 20 days, eight days of additional downstream throughput, 12 days of additional upstream production. At Sarnia, $150 million of it, the largest in its history, and was $5 million under budget. Montreal, a $32 million of it, completed in 48 days, 13 days ahead of schedule, and 7 million under budget. And our post turnaround capacity at Montreal has been 105% of nameplate.

Chris: So the second quarters complete how did we do for big events to upstream Syncrude based plant to downstream Sarnia in Montreal, we completed in aggregate all of our turnarounds on budget and a whopping, 10% shorter in duration, 10% equates to roughly 20 days.

Rich Kruger: Four big events, two upstream Syncrude Base Plant, two downstream Sarnia in Montreal. We completed, in aggregate, all of our turnarounds on budget in a whopping 10% shorter in duration. 10% equates to roughly 20 days, eight days of additional downstream throughput, and 12 days of additional upstream production.

Chris: Eight days of additional downstream throughput 12 days of additional upstream production.

Rich Kruger: It's Sarnia, $150 million event, the largest in its history, and it was $5 million under budget. Montreal, a $32 million event completed in 48 days, 13 days ahead of schedule, and $7 million under budget. And our post turnaround capacity at Montreal has been 105% of nameplate. Syncud $450 million gross event. The 8.3 COCR was completed in 57 days, nine days less than our previous best ever.

Chris: Sarnia, a $150 million of events the largest in its history and was $5 million under budget.

Chris: Montreal, a $32 million of event completed 48 days 13 days ahead of schedule and $7 million under budget and our post turnaround capacity at Montreal has been 105% of nameplate.

Richard Kruger: Synchroode, $450 million gross event, the 8.3 cocker was complete in 57 days, nine days less than our previous best ever. base plant, $370 million work scope, completed on budget and five days ahead of schedule. Our teams delivered across the board: safety, cost, schedule, and then restart. The impact we added nearly $20 million in free funds flow in the second quarter versus our budgeted plan performance. How do we do this? benchmark targets, risk-based work selection, quality planning and execution, clarity, focus, accountability, and determination.

Chris: Syncrude $450 million gross event. The eight three coker was complete in 57 days nine days less than our previous best ever.

Rich Kruger: Base Plant, $370 million work scope completed on budget and five days ahead of schedule. Our teams delivered across the board safety, cost, schedule, and then restart. The impact, we added nearly $20 million in free funds flow in the second quarter versus our budgeted plan performance. How did we do this?

Chris: Base plant $370 million work scope completed on budget and five days ahead of schedule.

Chris: Our teams delivered across the board safety cost schedule and then restart.

Chris: The impact we added nearly $20 million in free funds flow in the second quarter versus our budgeted plan performance. How do we do this benchmark targets risk based work selection quality planning and execution clarity focus accountability and determination.

Rich Kruger: Benchmark target, risk-based work selection, quality planning and execution, clarity, focus, accountability, and determination. Internally, 2023 was about achieving stability and predictability in turnaround performance. 2024 has been about improving work scope and duration. You may recall on May 21st, Dave outlined a capital cost reduction target of $225 to $250 million per year in turnarounds by year-end 2026. 2024 has provided us another proof point through improved work scope and shorter duration. Our next next target now is extended intervals between turnarounds. I'll move to the second area of targeted improvement mining.

Richard Kruger: Internally, 2023 was about achieving stability and predictability in turnaround performance. 2024 has been about improving work scope in duration. You may recall on May 21st, Dave outlined a capital cost reduction target of $225 to $250 million per year in turnaround by year-end 2026. 2024 has provided us another proof point through improved work scope and shorter duration.

Chris: Internally 2023 was about achieving stability and predictability in turnaround performance.

Chris: <unk> thousand 24 has been about improving work scope and duration and you may recall on May 21, Dave outlined to capital cost reduction target of $225 million to $250 million per year in turnarounds by year end 2026, 2024 has provided us.

Chris: Another proof point through improved work scope and shorter duration, our net our next target now is extended intervals between turnarounds.

Richard Kruger: Our next target now is extended intervals between turnaround.

Richard Kruger: I'll move to the second area of targeted improvement mining. Peter said it much more eloquently than I did on May 21st; rather than I will, our mining strategy in a nutshell is fewer trucks, bigger trucks, autonomous trucks, operated better, maintained cheaper. We've said before we have 55 new 400 ton trucks on order arriving, and they will replace twice as many smaller or less efficient third-party trucks. The first 22 are in operation. That's six more than our last call. 15 more will arrive at Fort Hills through November, and the final 18 will be at base plant in the fourth quarter this year and the first quarter of next year.

Chris: I'll move to a second area of targeted improvement mining.

Rich Kruger: Peter said it much more eloquently than I did on May 21st, or than I will, but our mining strategy, in a nutshell, is fewer trucks, bigger trucks, autonomous trucks, operated better, and maintained cheaper. As we've said before, we have 55 new 400-ton trucks on order, and they will replace twice as many smaller, less efficient third-party trucks. The first 22 are in operation. That's six more than our last call.

Peter Zebedee: Peter said it much more eloquently than I did on May 21, then I will but our mining strategy in a nutshell is fewer trucks bigger trucks.

Peter Zebedee: <unk> trucks operated better maintained cheaper we've said before we have 55, new 400 ton trucks.

Peter Zebedee: On order, arriving and they will replace twice as many smaller less efficient third party trucks. The first 22 are in operation that six more than our last call 15 more.

Rich Kruger: Fifteen more will arrive at Fort Hills through November, and the final 18 will be at the base plant in the fourth quarter of this year and the first quarter of next year. Last week, I sat behind the wheel of one of these bad boys at Fort Hills, and I got to tell you, I was ready to drive it into the mine, but sadly, Peter concluded I wasn't qualified. Recall, in total, these 55 new trucks will lower our overall corporate break-even by saving more than $300 million a year in operating costs. We've talked about autonomous vehicles before.

Peter Zebedee: Arrived at Fort Hills through November and the final 2018 will be at base plant in the fourth quarter of this year in the first quarter of next year last week I sat behind the wheel of one of these bad boys at Fort Hills, and I'd tell you I was ready to drive it into the mine, but sadly Peter concluded I wasn't qualified.

Richard Kruger: Last week, I sat behind the wheel of one of these bad boys at Fort Hills, and I got to tell you I was ready to drive it into the mine, but sadly Peter concluded I wasn't qualified. Recall, in total, these 55 new trucks will lower our overall corporate breakeven by saving more than $300 million a year in operating cost.

Speaker Change: Recall in total these 55, new trucks will lower our overall corporate breakeven by saving more than $300 million a year in operating costs.

Richard Kruger: We talked about autonomous previously. Our fleet conversion continues at base plant. Today we have 70 large haul trucks operating autonomously. That's 14 more than our last call. By the end of the year, will be at 91. Our north steep bank mine, the ore movements are now fully autonomous, and millennium is ramping up. We are moving 80 percent of all base mine ore autonomously now. Our original target was 100 percent by year-end. We will beat that target. Savings, $1 million per year per truck plus productivity gain. In total, $175 million annually by 2026 with expanded autonomous operations as outlined in our May 21st review.

Speaker Change: We've talked about autonomous previously our fleet conversion continues at base plant today, we have 70 large haul trucks operating autonomously, that's 14 more than our last call by the end of the year, we'll be at 91, our north steep bank mine the ore.

Rich Kruger: Our fleet conversion continues at the base plant. Today, we have 70 large haul trucks operating autonomously, 14 more than our last call.

Rich Kruger: By the end of the year, we'll be at 91. At North Steep Bank mine, the ore movements are now fully autonomous, and Millennium is ramping up. We are moving 80% of all base mine ore autonomously now. Our original target was 100%.

Speaker Change: Our movements are now fully autonomous and millennium is ramping up we are moving 80% of all base mine ore autonomously now our original target was 100% by yearend, we will beat that target.

Rich Kruger: By year end, we will beat that target, saving $1 million per year per truck plus productivity gains, for a total of $175 million annually by 2026 with expanded autonomous operations as outlined in our May 21st review. You may have noticed we've had increased commentary lately on in situ.

Speaker Change: Savings $1 million per year per truck plus productivity gain in total $175 million annually by 2026 with expanded autonomous operations as outlined at our May 21 review.

Richard Kruger: You may have noticed we've had increased commentary lately on We have achieved growth with back-to-back record quarters. In fact, we've set record quarters four of the last seven in our in situ operations. An example that Firebag were up essentially 10,000 barrels a day year on year with no growth investment. At today's prices, that's more than $100 million per year in additional free funds. So, how are we doing this? Steam reliability, produced water piping, site management, and infield drilling SOR management. Again, attention to detail. Firebag is our lowest cost, most profitable asset with growth potential.

Speaker Change: You may have noticed we've had increased commentary lately on institute.

Rich Kruger: We have achieved growth with back-to-back record quarters. In fact, we've set record quarters four of the last seven in our in-situ operations. As an example, at Firebag, we're up essentially 10,000 barrels a day, year on year, with no growth investment. At today's prices, that's more than $100 million per year in additional free funds. So how are we doing this? steam reliability, produced water piping, site water management, and infield drilling SOR management. Again, attention to detail.

Speaker Change: We have achieved growth with back to back record quarters. In fact, we've set record quarters for over the last seven and our <unk> operations and example at fire bag, we're up essentially 10000 barrels a day year on year with no growth investment at today's price.

Speaker Change: Mrs. That's more than a $100 million per year in additional free funds. So how are we doing this steam reliability produced water piping site water management and infield drilling SLR management again attention to detail fire bag is our lowest cost.

Rich Kruger: Firebag is our lowest cost, most profitable asset with growth potential. I was on site at Firebag in June. What did I see?

Speaker Change: <unk>, most profitable asset with growth potential.

Richard Kruger: I was on site at Firebag in June. What did I see? I saw a team focus on facility utilization and low-cost debudal netting. The latest example I'll share is a one million dollar modification to add diluant stripping capacity to increase bitchment production. Adding a fifth pressure safety valve adjacent to the existing four. This simple add, one valve, with increased bitchment rates by three to five thousand barrels a day per year. I saw pictures of this work early this morning. The new equipment being installed could fit in the back of my son's pickup truck. And the best part, this modification will be operational this month.

Speaker Change: Was on site at fire bag in June what did I see saw a team focused on facility utilization and low cost Debottlenecking. The latest example, I'll share is a $1 million modification to add diluent stripping capacity to increase bitumen production, adding a fifth.

Rich Kruger: I saw a team focused on facility utilization and low-cost de-bottlenecking. The latest example I'll share is a $1 million modification to add diluent stripping capacity to increase bitumen production, adding a fifth pressure safety valve adjacent to the existing four. This simple add-on valve will increase bitumen rates by three to 5,000 barrels a day per year. I saw pictures of this work early this morning. The new equipment being installed could fit in the back of my son's pickup truck. And the best part, this modification will be operational this month. A $1 million investment will deliver an additional $50 million per year in free funds.

Speaker Change: Pressure safety valve adjacent to the existing for this simple add one valve with increased bitumen rates by three to 5000 barrels a day per year I saw pictures of this work early this morning, the new equipment being installed could fit in the back of my son.

Speaker Change: <unk> pickup truck.

Speaker Change: And the best part this modification will be operational this month, a $1 million investment will deliver an additional $50 million per year in free funds.

Richard Kruger: A one million dollar investment will deliver an additional 50 million dollars per year in free funds. This example is representative of the focus within our operations across the company today. A laser-like focus on asset utilization, industrial engineering, challenging historic norms, testing facility limits, and safely modifying operating parameters. Identifying opportunities, capturing value, then immediately asking what's next. The result is low cost or no cost barrels, free barrels upstream and downstream. So whether it's turnaround execution, mining improvements in situ growth or other areas, these are tangible examples of today's son core focused, competitive results oriented.

Rich Kruger: This example is representative of the focus within our operations across the company today. A laser-like focus on asset utilization, industrial engineering, challenging historic norms, testing facility limits, and safely modifying operating parameters, identifying opportunities, capturing value, then immediately asking what's next. The result is low cost or no cost barrels, free barrels, upstream and downstream. So whether it's turnaround execution, mining improvements, in-situ growth, or other areas, these are tangible examples of today's Suncor. Focused, competitive, results-oriented. With that, I'll turn it over to Chris. Great

Speaker Change: This example is representative of the focus within our operations across the company to date, a laser like focus on asset utilization industrial engineering challenging historic norms testing facility limits and safely modifying operating parameters.

Speaker Change: Find opportunities capturing value then immediately asking what's next the result, as low cost or no cost barrels three barrels upstream and downstream.

Speaker Change: So whether its turnaround execution mining improvements in situ growth or other areas. These are tangible examples of todays suncor focused.

Speaker Change: <unk> results oriented with that I'll turn it over to Chris.

Kristopher Smith: With that, I'll turn it over to Chris.

Chris Smith: Great. Thanks, Rich, and good morning, everyone. I'll now provide a brief overview of the financial and operating performance in the second quarter, beginning first with the business environment in the second quarter, which continued to remain very robust. Crude oil prices improved across the board versus the first quarter, with WTI averaging U.S. $81 a barrel, the light heavy differential narrowing by U.S. $6 a barrel to average $14 a barrel, and the synthetic premium improving by U.S. $10 a barrel, averaging a $3 premium to WTI.

Kristopher Smith: Great, thanks, Rich, and good morning, everyone. I'll now provide a brief overview of the financial and operating performance in the second quarter. Beginning first with the business environment in the second quarter, which continue to remain very robust. Crude oil prices improved across the board versus the first quarter. With WTI averaging US $81 a barrel, the light heavy differential narrowing by US $6 a barrel to average $14 a barrel, and the synthetic premium improving by US $10 a barrel averaging a $3 premium to WTI. On the refining side, 211 cracking margins decrease slightly with softening of diesel cracks partially offset by strengthening gasoline cracks.

Chris: Great. Thanks, Rich and good morning, everyone.

Chris: I will now provide a brief overview of the financial and operating performance in the second quarter.

Chris Smith: On the refining side, 2-1-1 cracking margins decreased slightly with softening of diesel cracks partially offset by strengthening gasoline cracks. Our 5-2-2-1 refining index was US $26.70 a barrel, which is about $9 a barrel below Q1, driven primarily by strong crude oil pricing resulting in higher feedstock costs, along with softer cracking margins. As Rich noted in his comments, we continue to see strong operational performance across the board. Along with its strong turnaround performance in the quarter, Suncor's upstream delivered production of 771,000 barrels per day in the quarter, including 55,000 barrels per day of production in our E&P segment and record second quarter oil sands production of 716,000 barrels per day, which included record quarterly production at Firebag of 234,000 barrels per day.

Chris: Beginning first with the business environment in the second quarter, which continued to remain very robust crude.

Chris: Crude oil prices improved across the board versus the first quarter with W. Ti, averaging USD $81 a barrel the light heavy differential narrowing by U S $6, a barrel averaged $14 a barrel and the synthetic premium improving by U S $10, a barrel, averaging a $3 premium to <unk>.

Chris: Hi.

Chris: On the refining side to one one cracking margins decreased slightly with softening of diesel crack partially offset by strengthening gasoline cracks.

Kristopher Smith: Our 5221 refining index was US $26.70 a barrel, which is about $9 a barrel below Q1, driven primarily by strong crude oil pricing resulting in higher feedstock costs, along with softer cracking margin.

Chris: Our 5221 refining index was U S $26 70, a barrel, which is about $9 a barrel below Q1, driven primarily by strong crude oil pricing, resulting in higher feedstock costs, along with softer cracking margins.

Kristopher Smith: Productions. As Rich noted in his comments, we continue to see strong operational performance across the board. Along with strong turnaround performance in the quarter, Suncor's upstream delivered production of 771,000 barrels per day in the quarter, including 55,000 barrels per day of production in our EMP segment and record second quarter oil sands production of 716,000 barrels per day, which included record quarterly production at Firebag of 234,000 barrels per day. Fort Hills also had another strong quarter, producing 167,000 barrels per day, and consistent with our original plan outlined in the fall of 2022 and our current annual production guidance.

Chris: As rich noted in his comments, we continue to see strong operational performance across the board.

Rich Kruger: Along with strong turnaround performance in the quarter.

Rich Kruger: Suncor is upstream delivered production of 771000 barrels per day in the quarter.

Rich Kruger: Including 55000 barrels per day of production in our E&P segment and.

Rich Kruger: And record second quarter oil sands production of 716000 barrels per day, which included record quarterly production at fire bag of 234000 barrels per day.

Chris Smith: Ford Hills also had another strong quarter, producing 167,000 barrels per day, and consistent with our original plan outlined in the fall of 2022 and our current annual production guidance. Production in the second half of 2024 is expected to be lower than the first half as we will be moving more overburden as we open up the North Pit. Overall, we remain very pleased with the progress and the focus of the Fort Hills team on delivering against our improvement plan.

Rich Kruger: Fort Hills also had another strong quarter, producing 167000 barrels per day.

Rich Kruger: And consistent with our original plan outlined in the fall of 2022.

Rich Kruger: And our current annual production guidance production in the second half of 2024 is expected to be lower than the first half as we will be moving more overburden as we open up the north pit.

Kristopher Smith: Production in the second half, 2024, is expected to be lower than the first half, as we will be moving more overburden as we open up the North Pit. Overall, we remain very pleased with the progress and the focus of the Fort Hills team on delivering against our improvement plan. Total internal synthetic crude oil and vitamin transfers average 63,000 barrels per day in Q2, demonstrating our ability to leverage our physical integration to maximize value and mitigate the impacts of turnaround. This included 45,000 barrels per day of Benjamin transferred from Fort Hills to Base Plant upgrade. Now, with respect to the downstream, refining utilization was an impressive 92% in the second quarter, including impacts of planned turnaround at Sarnat and Montreal, with the refining network running at over 100% utilization following completion of those turnaround.

Rich Kruger: Overall, we remain very pleased with the progress and the focus of the Fort Hills team on delivering against our improvement plan.

Chris Smith: Total internal synthetic crude oil and bitumen transfers averaged 63,000 barrels per day in Q2, demonstrating our ability to leverage our physical integration to maximize value and mitigate the impacts of the turnaround. This included 45,000 barrels per day of bitumen transferred from Fort Hills to the base plant upgrade. Now, with respect to the downstream, refining utilization was an impressive 92% in the second quarter, including impacts of planned turnarounds at Sarnia and Montreal, with the refining network running at over 100% utilization following completion of those turnarounds. This supported refined product sales of 595,000 barrels per day, surpassing the previous record set last quarter by 14,000 barrels per day.

Rich Kruger: Total internal synthetic crude oil and bitumen transfers averaged 63000 barrels per day in Q2, demonstrating our ability to leverage our physical integration to maximize value and mitigate the impacts of turnarounds.

Rich Kruger: This included 45000 barrels per day of bitumen transferred from Fort Hills to base plant upgrades there.

Rich Kruger: Now with respect to the downstream refining utilization was an impressive 92% in the second quarter, including impacts of planned turnarounds at Sarnia in Montreal with the refining network running at over 100% utilization following completion of those turnarounds.

Kristopher Smith: This supported refined products sales of 595,000 barrels per day, surpassing the previous record set last quarter by 14,000 barrels per day. Downstream margin capture was also an impressive 99% in the quarter on a life basis when compared to SunCore's 5221 refining index. On the back of this strong operational performance, discipline cost and capital management, and a supportive business environment, SunCore delivered another quarter of solid financial results, generating $3.4 billion in adjusted funds from operations, or $2.65 per share. In the first half, that translates into $6.6 billion in adjusted funds from operations, or $5.11 per share.

Rich Kruger: This supported refined product sales of 595000 barrels per day.

Rich Kruger: Surpassing the previous record set last quarter by 14000 barrels per day.

Chris Smith: Downstream margin capture was also an impressive 99% in the quarter on a LIFO basis when compared to Suncor's 5-2-2-1 refining index. On the back of this strong operational performance, disciplined cost and capital management, and a supportive business environment, Suncor delivered another quarter of solid financial results, generating $3.4 billion in adjusted funds from operations, or $2.65 per share. In the first half, that translates into $6.6 billion in adjusted funds from operations, or $5.11 per share.

Rich Kruger: Downstream margin capture was also an impressive 99% in the quarter on a LIFO basis, when compared to Suncor is 5221 refining index.

Rich Kruger: On the back of this strong operational performance disciplined cost and capital management and a supportive business environment Suncor delivered another quarter of solid financial results generating $3 4 billion and adjusted funds from operations.

Rich Kruger: Or $2 65 per share.

Rich Kruger: In the first half that translates into $6 6 billion.

Rich Kruger: And adjusted funds from operations were $5 at <unk> 11 per share.

Kristopher Smith: Our laser focus on costs continued with total operating, selling, and general expenses of $3.2 billion in the quarter, which is down over $250 million from Q1. Second quarter costs were essentially flat with Q2 2023 when adjusting for the restructuring charge taken last year, related to our organizational downsizing. And at the same time, delivering 29,000 barrels per day, more upstream production, and 36,000 barrels per day, more downstream throughput. As Rick said earlier, that's what we call operating leverage. We also had a decrease in non-cash operating working capital in the quarter of approximately $400 million, primarily driven by higher accounts payable, as well as the timing of commodity tax and royalty payments.

Chris Smith: Our laser focus on cost continued with total operating, selling, and general expenses of $3.2 billion in the quarter, which is down over $250 million from Q1. Second quarter costs were essentially flat with Q2 2023 when adjusting for the restructuring charge taken last year related to our organizational downsizing, while at the same time delivering 29,000 barrels per day more upstream production and 36,000 barrels per day more downstream throughput. As Rich said earlier, that's what we call operating leverage. We also had a decrease in non-cash operating working capital in the quarter of approximately $400 million, primarily driven by higher accounts payable, as well as the timing of commodity tax and royalty payments.

Rich Kruger: Our laser focus on costs continued with total operating selling and general expenses of $3 2 billion in the quarter, which is down over $250 million from Q1.

Rich Kruger: Second quarter costs were essentially flat with Q2 2023, when adjusting for the restructuring charge taken last year related to our organizational downsizing and.

Rich Kruger: And at the same time, delivering 29000 barrels per day more upstream production and 36000 barrels per day.

Rich Kruger: We're downstream throughput.

Rich Kruger: As rich said earlier, that's what we call operating leverage.

Rich Kruger: We also had a decrease in noncash operating working capital in the quarter of approximately $400 million.

Rich Kruger: Primarily driven by higher accounts payable as well as timing of commodity tax and royalty payments.

Kristopher Smith: As for capital, it was $2 billion in the quarter, driven primarily by planned turnaround and maintenance activities as outlined by Rich across the assets, as well as continuing work on key economic projects like the base plant co-generation project and the Fort Hills North Pit extension. And our capital program remains on plan for the year. As a result, we generated $1.4 billion of free funds flow or $1.5 per share in the quarter, and aligned with our revised capital allocation framework announced in May, returned $1.5 billion or $1.19 per share to our shareholders, including $698 million in dividends plus $825 million in share repurchases.

Chris Smith: As for capital, it was $2 billion in the quarter, driven primarily by planned turnaround and maintenance activities, as outlined by Rich, across the assets, as well as continuing work on key economic projects like the base plant cogeneration project and the Fort Hills North Pit extension, and our capital program remains on plan for the year. As a result, we generated $1.4 billion of free funds flow, or $1.05 per share, in the quarter, and, in line with our revised capital allocation framework announced in May, returned $1.5 billion, or $1.19 per share, to our shareholders, including $698 million in dividends plus $825 million in share repurchase.

Speaker Change: As for capital it was $2 billion in the quarter, driven primarily by planned turnaround and maintenance activities as outlined by rich across the assets as well as continuing work on key economic projects like the base plant Cogeneration project and the Fort Hills, North pit extension and our capital program remains on plan for the.

Rich Kruger: A year.

Rich Kruger: As a result, we generated $1 4 billion of free funds flow of $1 five per share in the quarter and aligned with our revised capital allocation framework announced in May we returned $1 5 billion or $1 19 per share to our shareholders, including $698 million in dividends.

Rich Kruger: $825 million and share repurchases.

Kristopher Smith: For the first half, that means we've already returned $2.5 billion to our shareholders this year via dividends and buybacks. And as of this call, year to date, we have bought back over 2% of our shares. Our net debt ended the quarter at just under $9.1 billion, which is down $500 million versus the end of the prior quarter, and also included a $100 million increase from changes in foreign exchange on our US dollar denominated debt. This reduction is consistent with our plans to continue to reduce net debt toward our $8 billion target, as we laid out at our recent investor day.

Chris Smith: For the first half, that means we've already returned $2.5 billion to our shareholders this year via dividends and buybacks. And as of this call, year to date, we have bought back over 2% of our shares. Our net debt ended the quarter at just under $9.1 billion, which is down $500 million versus the end of the previous quarter and also included a $100 million increase from changes in foreign exchange on our U.S. dollar-denominated debt.

Rich Kruger: For the first half that means we've already returned $2 5 billion to our shareholders. This year via dividends and buybacks and as of this call year to date, we have bought back over 2% of our shares.

Rich Kruger: Our net debt ended the quarter at just under $9 1 billion.

Rich Kruger: Which is down $500 million versus the end of prior quarter and also included a $100 million increase from changes in foreign exchange on our U S dollar denominated debt.

Chris Smith: This reduction is consistent with our plans to continue to reduce net debt toward our $8 billion target, as we laid out at our recent Investor Day. The second quarter was a very strong one from every perspective, safety, operations, cost and capital discipline, and financial performance, resulting in strong financial returns for our shareholders, and which is a reflection of the continued focus and execution by the teams across the business. Looking forward, the Suncor team is fully focused on delivering the improvements laid out in our May 21 Investor Update and, as can be seen by our second quarter results, accelerating that plan wherever possible and driving shareholder value. And with that, I'll hand it back over to Rich.

Rich Kruger: This reduction is consistent with our plans to continue to reduce net debt toward our $8 billion target as we laid out at our recent investor day.

Kristopher Smith: The second quarter was a very strong one from every perspective: safety, operations, cost and capital discipline, and financial performance, resulting in strong financial returns for our shareholders, and which is a reflection of the continued focus and execution by the teams across the business. Looking forward, the SunCore team is fully focused on delivering the improvement laid out in our May 21 investor update, and as can be seen by our second quarter results, accelerating that plan wherever possible and driving shareholder value.

Rich Kruger: The second quarter was very strong one from every perspective safety operation cost and capital discipline and financial performance.

Rich Kruger: <unk> and strong financial returns for our shareholders and which is a reflection of the continued focus and execution by the teams across the business.

Speaker Change: Looking forward the Suncor team is fully focused on delivering the improvements laid out in our May 21, investor update and as can be seen by our second quarter results accelerating the plan wherever possible and driving shareholder value and with that I'll hand, it back over to rich.

Richard Kruger: And with that, I'll hand it back over to Rich.

Rich Kruger: Okay, a couple of comments before we get to your questions. First, full year guidance. The second quarter is complete, it's halftime, and Team Suncor is looking good, folks. Upstream Production, we are tracking above the high end of our guidance, and refining throughput, we are tracking above the high end of guidance. Refined Product Sales are again tracking above the high end of guidance. OS&G and CapEx we are tracking within or better than guidance. Now that said, we know we've got a second half to go, and we're going to play it out till the final whistle. We've repeatedly stated that today's Suncor is a new Suncor. Strategy changes, structural and cultural changes, tangible improvement plans, and performance proof points—lots of it.

Richard Kruger: Okay, a couple of comments before we get to your questions. First, full your guidance. Second quarter is complete. It's half time, and team SunCore is looking good, folks. Upstream production; we are tracking above the high end of our guidance. Refining throughput, we are tracking above the high end of guidance. Refine product sales, again, tracking above the high end of guidance. OSNG and CAPEX, we are tracking within or better than guidance.

Rich Kruger: Couple of comments before we get to your questions first full year guidance second quarter is complete.

Speaker Change: It's halftime and teams Suncor is looking good folks.

Speaker Change: Extreme production, we are tracking above the high end of our guidance refining throughput we are tracking above the high end of guidance.

Speaker Change: Refined product sales again tracking above the high end of guidance.

Speaker Change: <unk> and Capex, we are tracking within or better than guidance now that said, we know we've got a second half to go and we're going to play it out until the final whistle.

Richard Kruger: Now, that said, we know we've got a second half to go, and we're going to play it out till the final whistle. We've repeatedly stated that today's SunCore is a new SunCore. Strategy changes, structural and cultural changes, tangible improvement plans, and performance proof points; lots of them. We have a clear conference of road map and a determination to win.

Speaker Change: Sure.

Speaker Change: We have repeatedly stated that today's suncor is a new suncor strategy changes structural and cultural changes tangible improvement plans and performance proof points lots of them.

Rich Kruger: We have a clear, comprehensive roadmap and a determination to win. Personally, I come from a long line of hardworking, early to bed, early to rise farmers. And at the crack of dawn, my dad would often say, get up, son; you make hay while the sun shines. Well, the sun is shining on this company. And we plan to make hay in the second half of the year. With that, I'll turn it over to Troy.

Speaker Change: We have a clear comprehensive roadmap any determination to win.

Richard Kruger: Personally, I come from a long line of hard work in early to bed, early to rise farmers, and at the crack of dawn, my dad would often say, "Get up, Sun; you make hay while the Sun shines." Well, the sun is shining on this company, and we plan to make hay in the second half of the year.

Speaker Change: Personally I come from a long line of hard working early to bed early to rise farmers and at the crack of Dawn My Dad would often say get up you make hay, while the Sun shines well the Sun is shining on this company and we plan to make hay in the second half of the year.

Troy Little: With that, I'll turn it over to Troy.

Speaker Change: With that I'll turn it over to Troy.

Troy Little: Thank you, Rich. I'll turn the call back to the operator to ask some questions. Thank you.

Operator: Thank you, Rich. I'll turn the call back to the operator to take some questions. Thank you. As a reminder to ask a question, please press star 1-1 on your telephone and wait for your name to be announced. So, withdraw your question, press star 1-1 again. One moment while we compile the Q&A roster.

Troy: Thank you rich I'll turn the call back to the operator to take some questions. Thank.

Operator: Thank you. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, press star 11 again. One moment while we compile the Q&A roster. And our first question will come from the line of Greg Pardy with RBC Capital Markets. Your line is open.

Speaker Change: Thank you as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw your question Press Star One again, one moment, while we compile the Q&A roster.

Greg Pardy: And our first question will come from the line of Greg Pardy with RBC Capital Markets. Your line is open. Thanks. Good morning, and thanks for a very energetic and detailed rundown. I was hoping to come back to the turnarounds that, as you know, you laid out when extremely well. But Rich, could you or the team maybe point towards some specific examples as to what you're doing differently now that are working?

Speaker Change: And our first question will come from the line of Greg Pardy with RBC capital markets. Your line is open.

Greg Pardy: Thanks. Thanks.

Greg Pardy: Thanks, Good morning, and thanks for a very energetic and detailed rundown.

Greg Pardy: Good morning, and thanks for a very energetic and detailed rundown. I was hoping to come back to the turnarounds that, as you know, went extremely well. But, Rich, could you or the team maybe point towards some specific examples as to what you're doing differently now that are working?

Greg Pardy: I was hoping to come back to the turnarounds that as you laid out went extremely well.

Greg Pardy: Rich could you or the team maybe point towards some specific examples as to what Youre doing differently now that are working.

Rich Kruger: Absolutely, Greg, thanks. Yeah, I'm going to turn it over to Shelley Powell because Shelley, along with Dave, are really the ones who are the prime movers driving the performance improvement here. Shelley, do you want to offer some comments about what's different?

Richard Kruger: Absolutely, Greg. Thanks.

Shelly Pollock: Absolutely, Greg Thanks, I'm going to turn it over to Shelly Pollock as Shelly along with Dave are really the ones. We have the prime movers driving the performance improvement here as Shelly you want to offer some comments about whats different yeah, absolutely loves to talk about turnaround.

Shelley Powell: You know I'm going to turn over to Shelley Powell because Shelley, along with Dave, are really the ones who have the prime movers driving the performance improvement here. Shelly, you want to offer some comments about what's different? Yeah, absolutely.

Shelley Powell: Yeah, absolutely. I love to talk about turnarounds. So, as Dave mentioned during our May 21st Investor Day and then Rich reiterated this morning, certainly, improving our turnaround competitiveness is a major opportunity for us. And we know this because we have the benchmark front and center.

Shelley Powell: Let's talk about turnaround. So I think, as Dave mentioned during the May 21st investor day, and then Rich reiterated this morning, certainly improving our turnaround competitiveness is a major opportunity for us. And we know this because we have the benchmark front and center. And when we look at those benchmarks, what we see is an opportunity to both shorten the duration of our events; they're too long. And also improve our overall cost performance and bring costs down.

Greg Pardy: I think as Dave mentioned during the May 21.

Speaker Change: Yesterday, and then rich reiterated this morning, certainly improving our turnaround competitiveness is a major opportunity for us and we know this because we have the benchmark front and center.

Shelley Powell: And when we look at those benchmarks, what we see is an opportunity to both shorten the duration of our events, they're too long, and also improve our overall cost performance and bring costs down. So to answer your question, maybe I can give you an example in each of these areas of some of the things we're doing differently. So first, the biggest lever when it comes to shortening events is quite simply to do less work. And when we look at the past.

Shelly Pollock: And when we look at the benchmark, what we see as an opportunity to both shorten the duration of our events. There are too long and also improve our overall cost performance and bring costs down to answer. Your question. Maybe let me give you. An example in each of these areas of some of the things we're doing differently.

Shelley Powell: So, to answer your question, maybe let me give you an example in each of these areas of some of the things we're doing differently. So first, the biggest lever when it comes to shorten events is quite simply to do less work. And when we look in the past, some of our own inspection processes and standards were preventing us from doing this; required us to open and inspect certain pieces of equipment at very specific and defined time intervals, regardless of how that piece of equipment might have been used. So, as a bit of an analogy, maybe think of taking your car in for an oil change every four months, regardless of how often you drove it.

Shelly Pollock: First the biggest lever when it comes to shortening events is quite simply to do less work.

Shelly Pollock: And when we looked in the past.

Shelley Powell: Some of our own inspection processes and standards were preventing us from doing this. They required us to open and inspect certain pieces of equipment at very specific and defined time intervals, regardless of how that piece of equipment might have been used. As a bit of an analogy, maybe think of taking your car in for an oil change every four months, regardless of how often you drove.

Some of our own inspection processes and standards were preventing us from doing that it required us to open and inspect certain pieces of equipment at very specific and defined time intervals, regardless of how that piece of equipment might have been viewed as a bit of an analogy maybe think of taking your car in for in <unk>.

Shelly Pollock: Oil changed every four months, regardless of how often you drove it.

Shelley Powell: So now what we're doing is taking a much more specific approach, looking at each piece of equipment, looking at how it was operated, the conditions that it was exposed to, and then really deciding on the best inspection approach. Up to and including really kind of giving ourselves a tough question around what would it take to inspect this equipment offline and keep it out of the turnaround window entirely. So this is a new approach to what we call Risk-Based Inspection. And it's allowed us to take a fair amount of work out of the turnaround without adding any additional risk.

Shelley Powell: So now, what we're doing is taking a much more specific approach, looking at each piece of equipment, looking at how it was operated, the conditions that it was exposed to, and then really deciding on the best inspection approach, up to and including really kind of giving ourselves a tough question around what it would take to inspect this equipment offline and keep it out of the turnaround window entirely. So this is a new approach to what we call risk-based inspection, and it's allowed us to take a fair amount of work out of the turnaround without adding any additional risk. That's been a big win for us.

Shelly Pollock: So now what we're doing is taking a much more specific approach looking at each piece of equipment is looking at how it was operated the conditions that it was exposed to and then really deciding on the best inspection approach up to and including really kind of giving ourselves.

Shelly Pollock: Question around what would it take to inspect this equipment offline and keep it out of the turnaround window entirely. So this is a new approach to what we call risk based inspection.

Shelly Pollock: And it's allowed us to take a fair amount of work out of the turnaround without adding any additional risk that's been a big win for us.

Shelley Powell: That's been a big win for us.

Shelley Powell: Maybe a second example on the cost reduction side. This is an area where technology has really helped us. In our spring events, we used drones to complete refractory and stack inspections that were up at higher elevations. And just one of our events, this reduced and eliminated close to 3,000 hours that would have traditionally gone to building scaffold to get up to those heights. So this is an example that I think really delivers on all fronts. First of all, it means fewer people in our units, fewer exposure hours. So, from our safety perspective, we really like that.

Shelley Powell: Perhaps a second example on the cost reduction side. This is an area where technology has really helped us. In our spring events, we use drones to complete refractory and stack inspections that are up at higher elevations. In just one of our events, this reduced and eliminated close to 3000 hours that would have traditionally gone to building scaffolding to get up to those heights. So this is an example that I think really delivers on all fronts.

Shelly Pollock: Maybe a second example on the cost reduction side. This is an area where technology has really helped us in our spring events, we use drones.

Shelly Pollock: Fleet refractory and staff inspections that we're at that higher elevation.

Shelly Pollock: Just one of our events this reduced and eliminated close to 3000 hours that would have traditionally gone to building scaffold to get up to the tight.

Shelley Powell: First of all, it means fewer people in our units, and fewer exposure hours. So from a safety perspective, we really like that. It means reducing overhead costs. And as we get more efficient at this type of routine inspection over the long term, we also have the ability to shorten events. So now that we've got these benchmarks in front of us, we know exactly where to focus, and that's what we're doing.

Shelly Pollock: So this is an example that I think really delivers on our France first of all it means fewer people in our unit C where exposure hours that from a safety perspective, we really like that it means reducing overhead costs.

Shelley Powell: It means reducing overhead costs. And as we get more efficient on this type of routine inspection over the long term, we also have the ability to shorten event. So now that we've got these benchmarks in front of us, we know exactly where to focus, and that's what we're doing.

Shelly Pollock: And as we get more efficient on this type of routine inspection over the long term. We also have the ability to shorten event. So now that we've got these benchmarks in front of US, we know exactly where to focus and that's what we're doing.

Shelley Powell: And Shelley. Okay. Yeah, understood. No, thanks for that.

Shelley Powell: I'm Shelley.

Greg Pardy: Okay, yeah, understood. No, thanks for that.

Shelly Pollock: Okay.

Speaker Change: No thanks for that and maybe just to completely shift gears.

Richard Kruger: And maybe just to completely shift gears, you know, Richie talked about a number of the assets: you know, firebag, base operations, and so on. With sin crew, there's been good success, I think, with the bi-directional pipelines, but are there any further synergies that you see there on a go for basis? Yeah, I think there are, Greg. In fact, I'd say broadly, we see synergies across the entirety of our asset base. And now with Suncor being in the operating position with sin crew, the natural networks of people and sharing of ideas is just more, it's real time.

Greg Pardy: And maybe just to completely shift gears, you know, Rich, you've talked about a number of the assets, you know, firebag, base, operations, and so on. With Syncrude, there's been good success, I think, with the bi-directional pipelines. But are there any further synergies that you'd see there on a go-forward basis?

Rich Kruger: Rich you talked about a number of the assets fire bag base operations and so on.

Rich Kruger: With Syn crude theres been good success, I think with the bi directional pipeline, but are there any further synergies that you see there.

Speaker Change: On a go forward basis.

Rich Kruger: I think there are, Greg. In fact, I'd say broadly that we see synergies across the entirety of our asset base. And now with Suncor being in the operating position with Syncrude, the natural networks of people and sharing of ideas is just more, it's real time. And we've moved people into the Syncrude operation and out of the Syncrude operation to our other business. And so that network of expertise keeps expanding, and that creates synergies at a fundamental operating level with safety. The bi-directional pipelines certainly have helped there, but I think we're seeing synergies across the board. Peter, do you have anything else you'd add, a specific example?

Rich Kruger: Yes, I think there are Greg in fact, I'd say broadly, we see synergies across the entirety of our asset base and now with with Suncor being in the operating position with Syncrude.

Rich Kruger: The natural networks of people and sharing of ideas is just more it's real time and we've moved people into this include operation and out of the Syncrude operation into our other business and so that network of expertise keeps expanding and that creates.

Peter Zebedee: And we've moved people into the sin crewed operation and out of the sin crewed operation to our other business. And so that network of expertise keeps expanding, and that creates synergies at a fundamental operating level with safety. The bi-directional pipelines certainly have helped there, but I think we're seeing synergies across the board. I don't know, Peter. Do you have anything else you'd add? A specific example? Well, I think certainly, Greg, you know, we look at four hills in Aurora and their proximity. I mean, you can throw a baseball between the two sites. So there's some obvious synergies in terms of operating those assets that we're looking to do.

Rich Kruger: Synergies at a fundamental operating level with safety the.

Rich Kruger: The bidirectional pipeline certainly have helped there, but I think we're seeing synergies across the board Peter do you have anything else.

Peter Zebedee: I'll shoot out a specific example.

Peter Zebedee: Well, I think certainly, Greg, you know, we look at Fort Hills and Aurora and their proximity. I mean, you could throw a baseball between the two sites. So there are some obvious synergies in terms of operating both of those assets that we're looking to do. But maybe just to reinforce Rich's comments earlier, you know, regardless of how close the assets are, we believe our competitive differentiator really is the interconnectedness of our site. So whether that's, you know, Fort Hills to the base plant, Syncrude and Firebank Connects, etc., we're really looking to optimize and improve those as we go forward.

Peter Zebedee: Certainly, Greg we look at Fort Hills, and Aurora and their proximity I mean, you can throw a baseball between the two sites. So there is some obvious synergies in terms of operating in both of those assets that we're looking to do but maybe just to reinforce Richard's comments earlier.

Peter Zebedee: But maybe just to reinforce Rich's comments earlier, you know, regardless of how close the assets are, we believe our competitive differentiator really is the interconnectedness of our site. So whether that's, you know, four hills for the base plan, sin crewed and fire back connects, etc. We're really looking to optimize and improve those as we go forward. Yeah, I think Greg, I just add to that. And you're seeing that in the upgrade or utilization where previously sin crewed as an example was mine connected to upgrades. And anywhere you had planned or unplanned work, there was an impact on it.

Speaker Change: Regardless of how close the assets are we believe are competitive differentiator really is the interconnectedness of our site. So whether that's fort hills to the base plant Syncrude.

Speaker Change: And fire bag connects et cetera, we're really looking to optimize and improve those as we go forward.

Rich Kruger: And I think, Greg, I'd just add to that, you're seeing that in the upgrader utilization, where previously Syncrude, as an example, was mine connected to upgraders, and anywhere you had planned or unplanned work, there was an impact on it. Now, with this interconnectedness, we are able to maximize the run of these upgraders, just like, you know, conceptually like they're refineries, where they' And I commented on the added value of every 1% utilization. And so, you know, we will achieve a record high utilization this year, following upon a record high utilization last year. That's money in the bank.

Greg I'd just add to that.

Speaker Change: We're seeing that in the upgrader utilization, where previously Syncrude. As an example was mined connected to upgrade <unk> and anywhere you had planned or unplanned work there was an impact on it now with this interconnectedness, we are able to maximum run these upgrades.

Greg Pardy: I understand. Thanks very much.

Richard Kruger: Now, with this interconnectedness, we are able to, you know, maximum or run these upgrades just like it, you know, conceptually like their refineries where they're connected to multiple sources of feedstock. And I commented on the added the value of every one percent utilization. And so, you know, we will achieve a record high utilization this year, following upon a record high utilization last year. That's money in the bank.

Speaker Change: Just slide it.

Speaker Change: Conceptually like their refineries, where they're connected to multiple sources of feedstock.

Speaker Change: Commented on the added the value of every 1% utilization and so we will achieve a record high utilization. This year following upon a record high utilization last year, that's money in the bank.

Dennis Wong: Thanks very much. Thank you. One moment for our next question. And that will come from the line of Dennis Wong with CIBC. Your line is open. Hi, good morning.

Speaker Change: Understood Thanks very much.

Speaker Change: Thank you one moment our next question.

Operator: Thank you. One moment for our next question, and that will come from the line of Dennis Fong with CIBC. Your line is open.

Speaker Change: And that will come from the line of Dennis Fong with CIBC. Your line is open.

Dennis Fong: Hi, good morning. Thanks for taking my questions and congrats on, obviously, a very strong first half. Looking forward to kind of what the second half in 2025 looks like. My first question may be directed maybe towards Peter a little bit more. You've talked a little bit about technology and implementation with Shelley as well as in your opening remarks about technology and implementation. I just wanted to run back towards MindConnect, one of the, I guess, in-house developed pieces of technology that you are using to help track efficiency of the trucks. Can you talk about maybe some surprises you've seen in terms of the mining fleet efficiency? Also, maybe coupled with, obviously, the addition of these ultra-class trucks that you're adding to the field?

Dennis Fong: Hi, good morning, Thanks for taking my questions and congrats on obviously, a very strong first half looking forward to kind of what the second half of 2025 looks like.

Dennis Wong: Thanks for taking my questions, and congrats on obviously very strong first half. Looking forward to kind of what the second half in 2025 looks like. My first question may be directed maybe towards Peter a little bit more. You've talked a little bit from Shelley, as well as in your opening remarks, about technology and implementation. I just wanted to run back towards mine connect, one of the I guess in house developed pieces of technology that you are using to help track efficiency of the trucks. Can you talk towards maybe some surprises you've seen in terms of the mining fleet efficiency also may be coupled with obviously the addition of these ultra class trucks that you're adding to the field.

Dennis Fong: My first question, maybe directed maybe towards Peter a little bit more.

Speaker Change: You've talked a little bit from Shelley as well as in your opening remarks about technology and implementation.

Speaker Change: Wanted to run back towards mine connect one of the I guess in house developed pieces of technology that you are using to help track efficiency of the trucks can you talk towards maybe some surprises you've seen in terms of the mining fleet efficiency.

Speaker Change: Also maybe coupled with obviously the addition of these ultra class trucks that youre, adding to the field.

Peter Zebedee: Yeah, sure, Dennis; happy to do that. And I think, you know, to start with, it's my belief that transparency of data and performance really drives performance. So with MindConnect, you know, it's simply a tool that aggregates data across our sites. So we can see how Fort Hills is doing relative to Base Plant, to Syncrude, etc. And that drives a little bit of internal competitiveness, but it also gets down to the details.

Speaker Change: Yes.

Peter Zebedee: Yeah, sure, Dennis, happy to do that. I think, you know, to start with, you know, it's my belief that transparency of data and performance, you know, really drives performance. So, with mine connected, you know, it's simply a tool that aggregates the data across our sites. So we can see how Ford Hills is doing relative to base plant, to St. Crude, et cetera. And that drives a little bit of internal competitiveness. But it also gets down into the details. And, you know, the key to driving improvements in the upstream and our mining business is really around efficiency, and particularly the efficiency of the ultra-fast hull truck fleet.

Speaker Change: Sure happy to do that and I think to start with.

Speaker Change: I believe the transparency of data and performance really drives performance.

With mine connect it's simply a tool that aggregate the data across our sites. So we can see how Fort Hills is doing relative to our base plan to syncrude et cetera, and that drives a little bit of internal competitiveness.

Peter Zebedee: And, you know, the key to driving improvements in the upstream in our mining business is really around efficiency, and particularly the efficiency of the ultra-class haul truck fleet. So we can drill down, shift by shift, on how fast these trucks are operating, you know, how many tons they have on each load, etc, etc. And even drill down into individual operator performance. Actually, we shared with Rich last week just an example of a scorecard that we developed for operators in terms of, you know, relative performance, safety performance, truck productivity, performance, etc.

Speaker Change: But it also gets down into the details and the key to driving improvements in the upstream in our mining business is really around efficiency and particularly the efficiency of the ultra class truck fleet. So we can drill down on a ship by ship basis. How fast. These charts are operating how many tons they have on promote et cetera.

Peter Zebedee: So we can drill down on a shift-by-shift basis how fast these trucks are operating, you know, how many tons they have on, promote, et cetera, et cetera, and even drill down into the individual operator performance. Actually, we shared with Rich last week just an example of us, or a car that we developed for operators in terms of, you know, relative performance, safety performance, truck productivity performance, et cetera. So it sets up that data transparency, internal competitiveness, and a structural way to drive improvements; a targeted way to drive improvements. I think what you're seeing on the US and G costs that we've demonstrated here today is really, you know, the starting of the manifestation of our truck strategy.

Speaker Change: Et cetera, and even drill down into the individual operator performance actually we shared with rich last week. Just an example of a scorecard that we've developed for operators in terms of relative performance safety performance truck productivity performance et cetera. So it sets up that data transparency internal competitiveness in a store.

Peter Zebedee: So it sets up that data transparency, internal competitiveness, and a structural way to drive improvements, a targeted way to drive I think what you're seeing on the OS&G costs that we've demonstrated year-to-date is really the start of the manifestation of our truck strategy, buying those more trucks, driving efficiencies in scale, driving efficiencies in our operations, and really starting to get the right size for the material movements that we have today. So we're going to continue to do that, as Rich said, we've got a bunch more units that are coming in over the remaining six months of this year and into the first quarter of 2025, and we're going to continue to drive the efficiencies with the scale of those trucks that we're bringing in.

Speaker Change: <unk> way to drive improvements and targeted way to drive improvements.

Speaker Change: I think what youre seeing on the <unk> concept.

Speaker Change: Demonstrated year to date is really.

Speaker Change: The starting of the manifestation of our truck strategy of buying those more trucks driving efficiencies and scale driving efficiencies in our operations and really starting to get right sized for the material movements that we have today.

Peter Zebedee: Buying those more trucks, driving efficiencies in scale, driving efficiencies in our operations, and really starting to get right size for the material movements that we have today. So we're going to continue to do that. As Rich said, we've got a bunch more units that are coming in over the remaining six months of this year and in the first quarter of 25. And we're going to continue to drive the efficiencies with the scale of those trucks that we're bringing in. Great.

Speaker Change: So we're going to continue to do that as rich said, we've got a bunch more units that are coming in over the remaining six months of this year and ended the first quarter of 'twenty five.

Speaker Change: We're going to continue to drive the efficiencies with the scale of those trucks. So we're bringing in.

Dennis Fong: Great. I appreciate that color there, Peter. Shifting gears to the downstream side, through the quarter, obviously, very strong runtime, but also fairly good capture in terms of margin. I was hoping you could provide us with a bit of an update in terms of some of the marketing initiatives as well as management of inventory and global marketing of crude that you've been implementing just, I guess, as Dave has been spending some more time at the club.

Speaker Change: Great I appreciate that that color there Peter shifting.

Dennis Wong: I appreciate that color there, Peter. Shifting gears to the downstream side. Through the quarter, obviously, very strong runtime, but also fairly good capture in terms of margin.

Speaker Change: Shifting gears to the downstream side.

Speaker Change: Through the quarter, obviously very strong run time, but also fairly good capture in terms of margin.

Kristopher Smith: I was hoping to provide this a bit of an update in terms of some of the marketing initiatives as well as management of inventory and global marketing of crude that you've been implementing. Just, I guess, as Dave has been spending some more time at the company. Dave, Dave isn't here in the room with us today, or I turn it over him. Chris, you want to go ahead and comment on that? Sounds good. Hi, Dennis. Thanks for that. Yeah, I'm going to pinch it for Dave and put on my old downstream hat on this quarter, but your question is obviously broader than that, just in the marketing of crude.

Speaker Change: I was hoping you could provide us a bit of an update in terms of some of the marketing initiatives as well as management of inventory and <unk>.

Speaker Change: Global marketing crude that you've been implementing.

Speaker Change: Just I guess Thats data thats been spent.

Speaker Change: Spending some more time at the company.

Chris Smith: Dave isn't here in the room with us today, so I'll turn it over to him, but Chris, you want to go ahead and comment on that? Sounds good. Hi Dennis.

Speaker Change: Dave Davidson here in the room with US today are I'd turn it over to him, but Chris you want to go ahead and comment on that sounds.

Chris: Sounds good hi, Dennis Thanks for that I'm going to pinch hit for Dave I'll put on my own downstream.

Chris Smith: Thanks for that. Yeah, I'm going to pinch hit for Dave and put on my old downstream hat on this quarter, but your question is obviously broader than that, just in the marketing of crude, and I think it kind of touches on TMX, but before I go there, I mean, you raised the point that we had market capture of 99% in the quarter, and really, when we have that type of market capture, I think it demonstrates the various elements of our downstream business and how we go to market and the underlying strength of the asset.

Speaker Change: On this quarter, but your questions, obviously broader than that just in the market of crude I think.

Kristopher Smith: And I think kind of touches on TMX, but before I go there, I mean, you raised the point that we had market capture of 99% in the quarter. And really, when we have that type of market capture, I think it demonstrates the various elements of our downstream business and how we go to market and the underlying strengths of the asset. I mean, we have strong utilization, as we noted, particularly Edmonton, that a quarterly record, which helps us also with channel next. And then, because of our position, both domestically, within our branded channels and our export capability, our ability to capture March and across the value chain.

Speaker Change: Got it touches on <unk>, but before I go there I mean, you raised the point that we had market capture of 99% in the quarter and really when we have that type of market capture I think it demonstrates the various elements of our downstream business and how we go to market and the underlying strength of the asset and we had strong utilization as we noted.

Chris Smith: I mean, we had strong utilization, as we noted, particularly Edmonton set a quarterly record, which helps us also with channel mix, and then because of our position both domestically within our branded channels and our export capability, our ability to capture margin across the value chain, and we're seeing strength in our branded channels, both retail and wholesale, and then the strength of our logistics and marketing activities are also allowing us to export a record amount of distillate to and So even though we're running at high utilization and there's, you know, it's a distillate-long market in Western Canada, as an example, we're able to move those barrels and capture that margin, and so that underlines that market capture number, and we're continuing to build on that logistics capability, both domestically as well as taking advantage of TMX.

Speaker Change: Particularly Edmonton set a quarterly record.

Speaker Change: Which helps US also with channel mix and then because of our position both domestically within our branded channels at our export capability, our ability to capture margin across the value chain and we're seeing strength in our branded channels, both retail and wholesale and then the strength of our logistics and marketing activities.

Kristopher Smith: And we're seeing strength in our branded channels, both retail and wholesale. And then the strength of our logistics and marketing activities are also allowing us to export records amount of distillate to and clear the market. So even though we're running at high utilization, and there's, you know, we're to distillate long market in Western Canada as an example, we're able to move those barrels and capture and capture that margin. And so that underlines our market capture number. And we're continuing to build on that logistics capability, both domestically, as well as taking advantage of TMX. You would have heard Dave's talk at the last call about TMX.

Speaker Change: Are also allowing us to export records amount of distillate to unclear the market. So even though we're running at high utilization and theirs.

Speaker Change: The distillate loan market in Western Canada. As an example, we're able to move those barrels and capture and capture that margin and so that underlines our market or that market capture number and we're continuing to build on that logistics capability, both domestically as well as taking advantage of <unk>.

Chris Smith: You would have heard Dave talk on the last call about TMX, and when that asset came on, we viewed it as just another great opportunity within our logistics network to expand our reach to different markets, and we don't just take the product to the dock and sell it at the dock. We actually actively market into the end markets themselves and capture the arbitrage, and for that reason, we've taken some positions with some time charters as well.

Speaker Change: You would have heard Dave talked at the last call.

Dave Davidson: <unk> <unk> and when that asset came on we viewed it as just another great opportunity within our logistics network to expand our reach to two different markets.

Kristopher Smith: And when that asset came on, we viewed it as just another great opportunity within our logistics network to expand our reach to different markets. And we don't just take the product to the dock and sell it at the dock. We actually actively marked it into the end of markets themselves and capture the arbitrage. And for that reason, we've taken some positions with some time charters as well. We're really pleased with what we're seeing there. It's definitely adding value and just another demonstration, I think, of, you know, as Rich says, there's integration and there's some core integration and you kind of look at our platform on our downstream business all the way, you know, from that rack all the way through those domestic branded channels where we have, you know, best in class in Canada, along with now our reach obviously outside of Canada.

Speaker Change: We don't just take the product to the Doc consolidate the dock, we actually actively market into the end markets themselves and capture the arbitrage and for that reason, we've taken some physicians with some time charters as well, we're really pleased with what we're seeing there.

Chris Smith: We're really pleased with what we're seeing there. It's definitely adding value and just another demonstration, I think, of, you know, as Rich says, there's integration and there's Suncor integration, and you kind of look at our platform on our downstream business all the way, you know, from that rack all the way through those domestic branded channels where we have, you know, best in class in Canada, along with now our reach, obviously, outside of Canada.

Speaker Change: Definitely adding value and just another demonstration I think of it.

Rich Kruger: As rich says there is integration and Theres Suncor integration that you kind of look at our platform on our downstream business all the way from that rock all the way through those domestic branded channels, where we have.

Speaker Change: Best in class in Canada, along with now our reach obviously outside of Canada, and lastly, with inventories we carefully manage those inventories we would have had obviously a buildup or drawdown through Q2, as we prep for the turnarounds and that was another another component to that market capture we saw in the quarter.

Kristopher Smith: And lastly, with inventories, we carefully managed those inventories. We would have had obviously a build up and a draw down through Q2, as we prepped for the turnaround. And that was another component to do that market capture we saw in the quarter. Dennis Fong, you just added that a couple of comments.

Chris Smith: And lastly, with inventories, we carefully manage those inventories. We would have had, obviously, a buildup and a drawdown through Q2 as we prepare for the turnarounds, and that was another component to that market capture we saw in the quarter. Dennis, I could just add to that a couple of comments.

Rich Kruger: You know, there's a lot of research out there on refined product demand pre-pandemic versus now. And to give you a couple examples, we mentioned how we've set back-to-back refined product sales records for the company. And on gasoline, for example, in North America, kind of the walking around number pre-pandemic, gasoline demands were down about 5% from the second quarter, first half of 19 versus today for the market.

Dennis if I could just add to that a couple of comments.

Kristopher Smith: There's a lot of research out there on refined product demand, pre-pandemic versus now, and give you a couple examples. We've mentioned how we've set back to back, refined product sales records for the company. And on gasoline, for example, in North America, kind of the walking around number pre-pandemic, the gasoline demands down about 5% from the second quarter, first half of '19, versus today, for the market, we're up 5%. Diesel demand, depending on how you rack it up, is about flat or pre-pandemic; to now, we're up 10%. Jet, the still recovering, global demand for jet, down a few percent from pre-pandemic, we're on pace for an annual record high.

Dennis Fong: There's a lot of.

Dennis Fong: A lot of research out there on <unk>.

Dennis Fong: <unk> product demand pre pandemic versus now and give you a couple of examples we've mentioned how we've set back to back refined product sales records for the company and on gasoline for example in North America kind of the walk year round number pre pandemic the gasoline demands down about.

Dennis Fong: <unk>, 5% from the second half second quarter first half of 19 versus today for the market.

Dennis Fong: We're up 5% diesel demand dependent on rack.

Speaker Change: Our rack it up is about flat or.

Speaker Change: Pre pandemic to now we're up 10% jet.

Speaker Change: Still recovering global demand for jet down a few percent from pre pandemic. We're on pace for an annual record high in fact, we're up about 15% from pre pandemic and I would attribute these results to kind of three factors, our strategic relationships or partnerships.

Rich Kruger: Diesel demand, depending on how you rack it up, is about flat or pre-pandemic right now. We're up 10%. The still recovering global demand for jet fuel is down a few percent from pre-pandemic levels, and we're on pace for an annual record high. In fact, we're up about 15% from pre-pandemic, and I would attribute these results to kind of three factors: our strategic relationships or partnerships, our logistical reach, and our understanding of the market and ability to capture opportunities, and then getting right back to the reliability of our base business that provides value to our customers. So we talk a lot about upstream and downstream operations; our supply and marketing teams are focused like a laser equally on adding value, and I think you'll see that in the results.

Dennis Wong: In fact, we're up about 15% from pre-pandemic. And I would attribute these results to kind of three factors: our strategic relationships for partnerships, our logistical reach and our understanding of the market and ability to capture opportunities, and then get right back to the reliability of our base business that provides value to our customers. So we've talked a lot about upstream and downstream operational, our supply and marketing teams, our focus like a laser equally on adding value, and I think you see that in the results. Great. Really appreciate the color from all of you. I'll turn it back.

Speaker Change: Our logistical reach and our understanding of the market and ability to capture opportunities and then getting right back to the reliability of our base business that provides value to our customers. So we've talked a lot about upstream and downstream operational our supply and marketing teams.

Speaker Change: Our focus like a laser equally on adding value and I think youll see that in the results.

Dennis Fong: Great. I really appreciate the call from all of you. I'll turn it back.

Speaker Change: Great really appreciate the color from from all of you I'll turn it back.

Neil Mehta: Thank you. One moment for our next question. And that will come from the line of Neil Meadow with Goldman Sachs. Your line is open. Yeah. Good morning, Rich and team. Very, very strong results. And maybe that's where I want to start, which is the progress that you continue to make on driving down net debt. You're at $9 billion.

Operator: Thank you. One moment for our next question, and that will come from the line of Neil Mehta with Goldman Sachs. Your line is open. Yeah.

Speaker Change: Thank you one moment our next question.

Speaker Change: And that will come from the line of Neil Mehta with Goldman Sachs. Your line is now open.

Neil Mehta: Yeah, good morning, Rich and team. Very, very strong results. And maybe that's where I want to start, which is the progress that you continue to make on driving down net debt. You're at $9 billion. And so, you know, I just love your perspective on how you're tracking towards the $8 billion target. Is the middle of next year still the best bogey that you could provide? Or is there the potential to pull that forward? And just any perspective around how you see the cadence of de-leveraging?

Neil Mehta: Good morning, Rich and team are very very strong results and maybe thats, where I want to start which is the progress that you continue to make on driving down net debt you're at $9 billion or so.

Richard Kruger: And so, you know, I just love your perspective on how you're tracking towards the $8 billion target. As middle of next year, you're still the best bogey that you could provide, or is there the potential to pull that forward and just any perspective around how you see the cadence of de-leveraging from here? Well, I think Neil, if you step back for a second, kind of take market out of it, you know, some weeks we're excited about what the market conditions are, some weeks we're not, but if you kind of strip that out, the operational performance.

Speaker Change: Just love your perspective on how you're tracking towards the $8 billion target is middle of next year is still the best bogey that you can provide or.

Speaker Change: Is there the potential to pull that forward just any perspective around how you see the cadence of.

Speaker Change: Deleveraging from here.

Rich Kruger: Well, I think, Neil, if you step back for a second, kind of take the market out of it, you know, some weeks we're excited about what the market conditions are, some weeks we're not. But if you kind of strip that out, the operational performance, when we laid out the May 21 kind of business plan, we said, if you turn the crank, the numbers will spin out the middle of next year, but we are focused on beating that. And I think there was someone on the call who said something about, you know, maybe a Christmas present or no better Christmas present than year end.

Speaker Change: Well I think Neal if you step back for a second kind of take market out of it is some weeks. We're excited about what the market conditions are some weeks were not but if you kind of strip that out the operational performance. When we laid out the may 'twenty, one kind of the business plan. We said if you turn the crank the number.

Neil Mehta: When we laid out the May 21 kind of the business plan, we said, if you turn the crank, the numbers will spin out the middle of next year, but we are focused on beating that. And I think there was someone on the call that said something about, you know, maybe a Christmas present or no better Christmas present than year end. We're looking at all the levers to do that. And many of those levers are just our base performance. And when we put that business plan together that we reviewed, we benchmarked it off of 2023 in all areas: upstream, downstream, volumes, cost.

Speaker Change: We'll spit out the middle of next year, but we are focused on beating that and I think there was somewhat on the call and said something about maybe a Christmas present are no better Christmas present in year end, we're looking at all the levers to do that and many of those levers are just our base performance and.

Rich Kruger: We're looking at all the levers to do that, and many of those levers are just our base performance. And when we put that business plan together that we reviewed, benchmarked it against 2023 in all areas, upstream, downstream, volumes, costs, we are performing better than what we showed you on May 21. But, you know, there's a long way to go. We're certainly not declaring victory, but when I look at that, market factors aside, that tells me that we're looking at pulling that forward, and I'm increasingly confident that those things that we can control, we will be pulling those that bring that net debt target forward.

Speaker Change: When we put that business plan together that we reviewed.

We benchmarked it off a 2023.

Speaker Change: All areas upstream downstream volumes cost, we are performing better than what we showed you on may 21.

Richard Kruger: We are performing better than what we showed you on May 21st. Now, you know, there's a long way to go. We're certainly not declaring victory. But when I look at that, if our market factors aside, that tells me that we're looking at pulling that forward, and I'm having increased confidence that those things that we can control, we will be pulling those that bring that net debt target forward. You know, there's still a second half of the year to go, marketplace a big factor in it, but quite pleased with the fundamental performance of the organization on those factors that we can control that could accelerate that hitting that target.

Speaker Change: Now there's a long way to go we're certainly not declaring victory, but when I look at that.

Speaker Change: Our market factors aside that tells me that we're looking at pulling that forward and I'm, having increased confidence that those things that we can control we will be pulling those that bring that net debt target forward.

Rich Kruger: You know, there's still the second half of the year to go, and the market plays a big factor in it. But I'm quite pleased with the fundamental performance of the organization on those factors that we can control that could accelerate that hitting that target.

Speaker Change: There is still a second half of the year to go market plays a big factor in it but quite pleased with the fundamental performance of the organization on those factors that we can control that could accelerate that hitting that target.

Neil Mehta: Yeah, thanks, Rich. That's really helpful. And then just to follow up on how you can pull that forward, asset sales become part of the potential mechanism to do that. And then the other swing in the calculation, of course, is how we should be thinking about working capital. So your perspective on those two line items.

Neil Mehta: Yeah, thanks, Rich. That's really helpful.

Rich Kruger: Yes, thanks rich.

Really helpful. And then just to follow up on how you can pull that forward asset sales become part of the potential mechanism to do that and then the other swing in the calculation of course is how we should be thinking about working capital. So your perspective on those two two line items would be great.

Richard Kruger: And then just to follow up on how you can pull that forward, asset sales become part of the potential mechanism to do that. And then the other swing in the calculation, of course, is how we should be thinking about working capital. So your perspective on those two line items would be great. You know, I've talked a little bit about asset sales in the past, those things that are, you know, kind of core to our integrated strategy, and add the most value in those assets that are, you know, that are less core, but they can be quite valuable to us.

Rich Kruger: You know, I've talked a little bit about asset sales in the past, those things that are, you know, kind of core to our integrated strategy and add the most value, and those assets that are, you know, that are less core, but they can be quite valuable to us. So we don't, you know, we don't talk specifically about anything until we actually have something to talk about.

Speaker Change: I've talked a little bit about asset sales in the past those things that are kind of.

Speaker Change: Core to our integrated strategy and add the most value and those those assets that are that are less core, but they can be quite valuable to us. So we don't we don't talk specifically about anything until we actually have something to talk about but we are we continue to look at all of our assets and the value they add.

Kristopher Smith: So we don't, you know, we don't talk specifically about anything until we actually have something to talk about. But we are; we continue to look at all of our assets and the value they add to us versus the value they may offer to others. So that could be a part of the timing on achieving net debt. And, you know, Chris, on the working capital, would you like to comment on that? Yeah, for sure. Hey, Neil. Yeah, I mean, good call out. You know, when we think about the levers for us to be pulling on every dimension of the business, I mean, Rich already mentioned, you know, we think production costs is naming capital, but working capital is obviously a key component of that too.

Chris Smith: But we are, we continue to look at all of our assets and the value they add to us versus the value they may offer to others. So that could be a part of the timing of achieving net debt. And, you know, Chris, on working capital, would you like to comment on that? Yeah, for sure. Hey, Neil.

Speaker Change: To us versus the value they may offer to others, so that could be a part of the.

Speaker Change: Of the timing on achieving net debt.

Chris: Chris on the working capital would you like to comment on that for sure Hey, Neil.

Chris Smith: Yeah, I mean, good call out when we think about the levers for us to be pulling on every dimension of the business. I mean, Rich already mentioned production costs, sustaining capital, but working capital is obviously a key component of that too. So you can rest assured that the Suncor team has a laser focus on that as well and is just sharply managing that working capital. Like the others, it's a lever in our toolkit to ensure excellent execution of the business. And so we've got our eye on that too and its contribution to cash.

Chris: Good call out when we think about the levers for us to be pulling on every dimension of the business I mean.

Neil Mehta: Where it's already mentioned production costs sustaining capital, but working capital is obviously a key component of that too. So you can rest assure that the suncor team has a laser focus on that as well and just sharply managing that working capital like like the others. It's a lever in our toolkit to ensure excellent.

Kristopher Smith: So you can rest assured that the sun core team has a laser focus on that as well, and just sharply managing that working capital like the others. It's a lever in our toolkit to ensure excellent execution of the business. And so we've got our eye on that too, and its contribution to cash. Thank you, Chris. Thanks for it. You're welcome. Thank you. One moment for our next question. And that will come from the line of Manav Gupta with UBS. Your line is open. Good morning, guys. Would like to highlight that this is the second quarter in a row where you are pretty much peat in the street on every important matrix.

Neil Mehta: Execution of the business and so we've got our eye on that too and its contribution to.

Neil Mehta: Cash.

Chris Smith: Thank you, Chris. Thanks, Rick.

Neil Mehta: Thank you Chris Thanks, Rick.

Chris: Youre welcome.

Operator: Welcome. Thank you. One moment for our next question, and that will come from the line of Manav Gupta with UBS. Your line is open.

Speaker Change: Thank you one moment our next question.

Speaker Change: And that will come from the line of Manav Gupta with UBS. Your line is open.

Manav Gupta: Good morning, guys. I would like to highlight that this is the second quarter in a row where you have pretty much beaten the street on every important metric. So, congratulations on that. Those things tend to drive very strong re-ratings.

Manav Gupta: Good morning, guys would like to highlight that this is the second quarter in a row of pretty much beaten the street on every important metric. So congratulations on that those things tend to drive very strong leading things.

Manav Gupta: So congratulations on that. Those things tend to drive very strong re-ratings. My first question to you, sir, is that when I look at year to date, it's close to $31, and your guidance is 33 to 36. So first of all, like, do should we expect you to be towards the lower end of beat your guidance? And then, as these new trucks alive, can we see a scenario in 2025 where this cash cost drops closer to $30 or even below it? You know, I think I appreciate you flagging that on the cost. What we're finding here, you know, the volume metric effect is a huge lever on costs.

Manav Gupta: My first question to you, sir, is that when I look at year-to-date Fort Hills cash costs, it's close to $31, and your guidance is $33 to $36. So, first of all, should we expect you to be closer to the lower end or beat your guidance? And then, as these new trucks arrive, can we see a scenario in 2025 where this cash cost drops closer to $30 or even less?

Speaker Change: My first question to you is that when I look at year to date <unk> cash costs, it's close to $31 and your guidance is <unk> 36. So first of all like do should we expect you to be towards the lower end of beat your guidance and then as these new trucks at night.

Speaker Change: Can you see a scenario in 2025, this cash cost dropped below $30 or even below it.

Rich Kruger: You know, I think I appreciate you flagging that on cost. What we're finding here, you know, the volumetric effect is a huge lever on cost. And so running at or above our guidance range, upstream and downstream, that is a big part of driving unit costs down. And we're, and as I said earlier, exceeding our rate of expected improvement on the volume side of it. The area that I probably had probably the biggest question mark and a little bit of uncertainty on was fundamental cost management, the discipline that it takes on each and every dollar. And I'm extremely pleased with the organization's response through the first half of the year. Don't declare victory.

Speaker Change: I think I appreciate you're flagging that on the cost.

Speaker Change: What we're finding here the volumetric effect is a huge lever on costs and so running at the at or above our guidance range of upstream and downstream that is a big part of driving unit cost down and were up and as I said earlier, we're exceeding R. R.

Richard Kruger: And so running at or above our guidance range upstream and downstream, that is a big part of driving unit costs down. And we're up. And as I said earlier, we're exceeding our rate of expected improvement on the volume side of it. The area that I had probably that, you know, the biggest question mark in a little bit of the uncertainty on was fundamental cost management, the discipline that it takes to on each and every dollar. And I'm extremely pleased with the organization's response through the first half of the year. Don't forget our victory. We've got a long way to go on that.

Speaker Change: Right of expected improvement on the volume side of it.

Speaker Change: Area that I had probably the biggest question mark and a little bit of the uncertainty was fundamental cost management discipline that it takes to on each and every dollar and I am extremely pleased with the organization's response to the first half of the year.

Peter Zebedee: Don't declare victory, we've got a long way to go on that but I think Peter has shared many of the examples with you on improving the mining performance, which is big Dave's got the same kind of focus on the <unk>.

Rich Kruger: We've got a long way to go on that, but I think Peter has shared many of the examples with you on improving mining performance, which is big. Dave's got the same kind of focus on the downstream. So, you know, where we are tracking will be at or better than our cost guidance. And that's, you know, again, we've got five months of the year left, but I think that is a reasonable outlook, a reasonable expectation. Peter, do you have anything else to comment on?

Peter Zebedee: But I think Peter has shared many of the examples with you on improving the mining performance, which is big. Dave's got the same kind of focus on the downstream. So, you know, where we are tracking will be at or better than our cost guidance. And that's, you know, again, we've got five months of the year left, but I think that is a reasonable outlook, a reasonable expectation. Peter, do you have anything else to comment on? Have any costs? The biggest bulk of the cost is in Europe. Yeah, and I would say especially at Fort Hales, Manav, and it is a good call.

Speaker Change: On the downstream so.

Speaker Change: Where we are tracking will be at or better than our cost guidance and Thats again, we got five months of the year left but I think that as.

Speaker Change: A reasonable outlook a reasonable expectation.

Speaker Change: Peter you have anything else to comment on admin cost, but the biggest bulk of the costs are in Europe.

Peter Zebedee: I mean, the cost, the biggest bulk of the costs are in your... Yeah, I would say, especially at Fort Hales, Manav, and it is a good call that we've had some really good months where our costs have been, you know, better than guidance, of course. But, you know, as we look forward for the rest of the year, we're remaining disciplined to our mine improvement plan. We're exactly on track with that

Peter Zebedee: I would say that especially at Fort Hills would have and it is a good call that we've had some really good months, where our costs have been better than guidance of course, but as we look forward for the rest of the year. We're remaining disciplined to our mind improvement plan, we're exactly on track on that and some of the key activities involved the opening up of the north pit walls.

Peter Zebedee: We've had some really good months where costs have been, you know, better than guidance, of course. But as we look forward for the rest of the year, we're remaining disciplines who are mine improvement plan. We're exactly on track on that. And some of the key activities involved, the opening up of the North Pit will drive higher mining volumes and hence our strategy to employ these large hall trucks, drive efficiency in our mining operations and maintain our unit mining cost punish at or better than where we have been historically. So it's really about driving discipline, making sure that we're staying true, that having sufficient mining inventory so that we have sufficient management production out of that facility.

Peter Zebedee: And some of the key activities involve the opening up of the North Pit, which will drive higher mining volumes and hence our strategy to employ these larger haul trucks, drive efficiency in our mining operations, and maintain our unit mining cost tonnage at or better than where we have been historically. So it's really about driving discipline, making sure that we're staying true to having sufficient mine inventories so that we have sufficient bitumen production out of it.

Drive higher mining volumes and hence our strategy to employ these larger haul trucks drive efficiency in our mining operations and maintain our unit mining cost tonnage.

Peter Zebedee: Better than where we have been historically, so its really about driving discipline, making sure that we're staying true to having sufficient mine inventories. So that we have sufficient bitumen production out of that facility.

Peter Zebedee: And I'll just add, I think some of the exciting things about, particularly in Peter's business, there, the steps we're taking are very tangible. You know, when you convert a truck to autonomous, the costs that are extracted from that, we know when we bring a new 400-ton haul truck to improve efficiency and productivity. So these improvements are very tangible. They're independent of oil prices.

Richard Kruger: And I just add, I think some of the exciting things that I'll particularly in Peter's business, they're the steps we're taking are very tangible. You know when you convert a truck to autonomous, the costs that are extracted out of that. We know when we bring a new 400 ton hall truck on the efficiency and the productivity. So these improvements are very tangible. They're independent of oil price, and they're a matter of the sequence and the pace at which we're pursuing. And what I'll tell you is we keep challenging ourselves to can we accelerate the pace of our improvements, the conversion to autonomy.

Peter Zebedee: Just to add I think some of the exciting things about particularly in Peter's business there.

Peter Zebedee: The steps, we're taking are very tangible you know when you convert a truck to autonomous the costs that are extracted out of that we know when we bring a new 400 ton haul truck on the efficiency and the productivity. So these improvements are very tangible there independent of oil price and.

Peter Zebedee: They are a matter of the sequence and the pace at which we're pursuing.

Rich Kruger: And it's a matter of the sequence and the pace at which we pursue them. And what I'll tell you is that we keep challenging ourselves to accelerate the pace of our, our improvements. The conversion to autonomy, can we accelerate that pace? The, you know, we're a little bit at the mercy of our OEM manufacturers on the delivery of haul trucks, but we're working hard directly with them on new trucks and shovels because of the tangible nature of the improvement, which is money in the bank. When we capture those in the, there's an urgency that Peter has created within his organization that I'm quite proud of and because we know it can make our business better and stronger for the long term.

Peter Zebedee: I'll tell you is we keep challenging ourselves to can we accelerate the pace of our of our improvements the conversion to autonomy can we accelerate that pace.

Manav Gupta: Can we accelerate that pace? We're a little bit at the mercy of our OEM manufacturers on the delivery of hall trucks. But we're working hard directly with them on new trucks and shovels because of the tangible nature of the improvement. You know, as money in the bank, when we capture those in the, there's an urgency that Peter has created within his organization that I'm quite proud of. And because we know it can make our business better, stronger for the long term. Thank you for a very detailed response. My quick follow up here is we understand you're not as exposed to the WCS differential given your refining operations, but we have seen some widening here and trying to understand what's your need near to medium term outlook on the WCS differential.

Speaker Change: We're a little bit at the.

Speaker Change: The mercy of our OEM manufacturers on the delivery of all trucks, but we're working hard directly with them on new trucks and shovels because of the tangible nature of the improvement is money in the bank when we capture those in the.

Speaker Change: There is an urgency that Peter has created within his organization that I'm quite proud of it.

Peter Zebedee: As we know it can make our business better and stronger for the long term.

Manav Gupta: Thank you for a very detailed response. My quick follow-up here is we understand you're not as exposed to the WCS differential given your refining operations, but we have seen some widening here, and we're trying to understand what your near to medium-term outlook is on the WCS differential. Obviously, TMX is running, but then you guys and everybody else will also be running much harder in the second half. So I'm trying to understand your outlook for the differential in the medium and near term.

Speaker Change: Thank you for the detailed response my quick follow up here is we understand you're not as exposed to the WCS differential given your refining operations, but we have seen some widening here and trying to understand what's your immediate near to medium term outlook on the WCS differential obviously BMS is running but then youll guys.

Richard Kruger: Obviously, TMX is running, but then you guys and everybody else will also be running much harder in the second half. So trying to understand your outlook for the differential in medium and near term. Well, you're spot on that our level of integration in the nature of our asset base gives us a lot of resiliency or natural hedge or cushion where we're not nearly as vulnerable as, you know, our competitors might be. But Chris, you want to talk a bit about that. Yeah, sure, absolutely. I mean, obviously, with TMX coming on last quarter, it certainly provides a structural help to the WCS differential; is that additional egress is now available to the basin.

Speaker Change: And everybody else would ultimately running much harder in the second half so trying to understand your outlook for the differential in medium in near term.

Rich Kruger: Well, you're spot on that our level of integration and the nature of our asset base gives us a lot of resiliency or natural hedge or cushion where we're not nearly as vulnerable as our competitors might be. But Chris, do you want to talk a bit about that? Yeah, sure. Absolutely. Absolutely.

Speaker Change: Well you are spot on that are our level of integration and the nature of our asset base gives us a lot of resiliency or natural hedge our cushion where were not nearly as vulnerable as.

Chris: Our competitors might be but Chris you want to talk a bit about that yes, sure absolutely I mean, obviously with <unk> coming on last quarter. It certainly provides structural.

Chris Smith: Yeah, sure, absolutely. I mean, obviously, with TMX coming on line last quarter, it certainly provides a structural help to the WCS differential as that additional egress is now available to the basin. That said, I mean, you're still going to see that light, heavy differential move around a little bit depending on what's going on in the market. And, you know, we saw it come in when the line came in, came on. We all expected that.

Chris: Structural help to the WCS differential is that it.

Chris: So egress is now available to the basin.

Kristopher Smith: That said, I mean, you're still going to see that light heavy differential, you know, the move around a little bit depending on what's going on in the market. And, you know, we saw it come in when the line came in came on. We all expected that I'm trading down kind of low teens. It's since widened out, but that was a bunch of other factors. There was refinery outages and had to through that period of time. There was a big drawdown in inventories out of out of hearted state. So there was more product going to market with a little bit of weakness and pricing at the Gulf Coast.

Speaker Change: That said I mean, youre still going to see that light heavy differential.

Speaker Change: Move around a little bit depending on what's going on in the market.

Speaker Change: We saw it come in when the line came in came on we all expected that.

Chris Smith: And trading down kind of low teens; it's since widened out. But that was a bunch of other factors. There were refinery outages in pad two through that period of time. There was a big drawdown in inventories out of Hardesty.

Speaker Change: Trading down kind of low teens at since widened out but.

Speaker Change: That was a bunch of other factors there was refinery outages in pad two.

Speaker Change: Through that period of time, there was a big drawdown in.

Speaker Change: Inventory.

Speaker Change: Hardesty, so there was more product going to market and we saw a little bit of weakness in pricing at the Gulf coast, those things factored into the differential widening out a bit but our view is is that we're going to continue to see that light heavy differential be supported in the low to mid teens will it will it get a bit.

Chris Smith: So there was more product going to market, and we saw a little bit of weakness in pricing on the Gulf Coast. Those things factored into the differential widening out a bit. But, you know, our view is that we're going to continue to see that light heavy differential be supported in the low to mid teens. Will it get a bit higher now and then because of market factors? We can absolutely expect that.

Kristopher Smith: Those things factored into the differential widening out a bit. But, you know, our view is that we're going to continue to see that light heavy differential be supported in the low to mid teens. It will get a bit higher now and then because of market factors; we can absolutely expect that. But it should be far more structurally supported than we would have seen a number of years ago when we would see big volatility and see blowouts and that light heavy differential. But I think that, you know, the main underlying point to all that is the one Rich just made and just with our integrated business model all the way from bitchman production through upgrading through our downstream business refining and then on to the customer.

Speaker Change: Higher known then because of market factors, we can absolutely expect that but it should be far more structurally supported then we would have seen a number of years ago. When we would see big volatility and see blow ups in that light heavy differential, but I think the main underlying point to all of that is the one rich just made and just with our integrated business model.

Chris Smith: But it should be far more structurally supported than we would have seen a number of years ago when we would see big volatility and see blowouts in that light, heavy differential. But I think that, you know, the main underlining point to all that is the one Rich just made. And just with our integrated business model, all the way from bitumen production through upgrading, through our downstream business refining, and then onto the customer, we're largely insulated from that type of volatility.

Rich Kruger: All the way from bitumen production through upgrading through our downstream business refining and then on to the customer we are largely insulated from that type of volatility.

Roger Read: We're largely insulated from that type of volatility. Thank you so much. Thank you. One moment for our next question, and that will come from the line of Roger Read with Wells Fargo. Your line is open. Yeah, thanks. Good morning. Maybe just to come back on the cost structure here, you know, obviously, real good performance in the second quarter. I was just wondering, is there anything in it that was one time in nature or a timing factor? I just what I'm really trying to understand is what's the new baseline of cost that we should think about.

Speaker Change: Thank you so much.

Speaker Change: Thanks.

Speaker Change: Thank you one moment our next question.

Operator: Thank you. One moment for our next question, and that will come from the line of Roger Read with Wells Fargo. Your line is open.

Roger Read: And that will come from the line of Roger read with Wells Fargo. Your line is open.

Roger Read: Yeah, thanks. Good morning.

Roger Read: Yes, thanks, good morning.

Roger Read: Maybe just to come back on the cost structure here, real good performance in the second quarter. I was just wondering, is there anything in it that was one-time in nature or a timing factor? I just want to understand what's the new baseline of costs that we should think about maybe how you're measuring that and how you plan to, you know, Let's call it, maintain that for the rest of the year and lower it over time. Yeah, Roger, this is Rich. There were no events or things at any one time.

Speaker Change: Maybe just to come back on.

The cost structure here.

Roger Read: Obviously real good performance in the second quarter I was just wondering is there anything in it that was one time in nature or a timing factor I, just what im really trying to understand is what's the new baseline or costs that we should think about maybe how you're measuring that and how you plan to.

Richard Kruger: Maybe how you're measuring that and how you plan to, you know, let's call it. Maintain that for the rest of the year, lower it over time. Roger at this rich, there were no one time any events for things. I think the biggest thing I'd say is we took a restructuring charge in the second quarter of last year. I believe the numbers somebody keep the honest 275 million dollars. And what I said in my comments is that, year on year, we're in absolute dollars, we're 270 million dollars less than we were in the first half. So when you take out that restructuring charge, we're basically flat in absolute costs, despite the much, much higher volumes across the board.

Speaker Change: Let's call it maintain that for the rest of the year lowered over time.

Rich Kruger: I think the biggest thing I'd say is that we took a restructuring charge in the second quarter of last year. I believe the number is, somebody keep me honest, $275 million. And what I said in my comments is that, year on year, we're in absolute dollars $270 million less than we were in the first half. So when you take out that restructuring charge, we're basically flat in absolute cost despite the much, much higher volumes across the board.

Rich Kruger: Yes, Roger this rich there were no one time any events or things I think the biggest thing I'd say is we took a restructuring charge in the second quarter of last year I believe the numbers somebody keep me honest $275 million.

Speaker Change: And what I said in my comments is that year on year in absolute dollars were $270 million less than we were in the first half. So when you take out that restructuring charge were basically flat in absolute cost despite the much much higher.

Rich Kruger: So I think that, you know, that's the operating leverage we talked about. And so going forward, you know, that's today's Suncor. That is the focus we're bringing, and it is expected to continue with higher reliability. You get higher volumes; it drives down the unit costs, with the discipline, with the actions that Peter has described in the upstream, and Dave has done similarly in the downstream, to keep the cap on costs. I mean, that's who we are.

Speaker Change: <unk> across the board so I think the.

Richard Kruger: So I think the, you know, that's that operating leverage we talked about. And so going forward basis. This, you know, that's today's on court. That is the focus we're bringing and expected to continue with higher reliability. You get the higher volumes. It drives down the unit costs with the discipline, with the actions that Peter has described in the upstream day that's similar in the downstream to keep the cap on cost. I mean, that's who we are. Another way I'd offer you to look at it just is kind of an interesting way. We added the remaining interest at Ford Hills this year.

Speaker Change: That said operating leverage we talked about and so a going forward basis.

Speaker Change: That's today's suncorp that is the focus we are bringing and expected to continue with higher reliability you get the higher volumes. It drives down the unit cost with the discipline with the actions that Peter is described in the upstream Dave is similar in the downstream to keep the cap on.

Rich Kruger: Another way I'd offer you to look at it just as kind of a kind of interesting way is that we added the remaining interest at Fort Hills this year, and we've offset inflationary pressures which there are throughout our business. We did all that for free. We offset inflation, and added Fort Hills barrels at no higher cost.

Dave Davidson: Cost I mean.

Speaker Change: That's who we are another way I'd offer you to look at it as kind of a kind of an interesting way we added the remaining interest at Fort Hills This year.

Richard Kruger: And we've offset inflationary pressures, which there are throughout our business. We did all that for free. We offset inflation; added Ford Hills barrels at no higher cost. Again, it keeps coming back to the phrase I use: operating leverage. And I think that is the, you know, the thing I would say that I'm particularly continue to be pleased with is the level of focus within the organization on the goals. The objective is what's important. And when you create focus with 15,000 plus people, you can, you can get resolved. And that's exactly what you're seeing. And I, I see no reason that won't continue.

Speaker Change: And we've offset inflationary pressures, which there are throughout our business.

Speaker Change: We did all of that.

Speaker Change: For free we offset inflation added Fort hills barrels at no higher cost again, it keeps coming back to the phrase of users is operating leverage and I think that is the the thing I would say that I am particularly continue to be pleased with is the level of focus within the.

Rich Kruger: Again, it keeps coming back to the phrase I use is operating leverage. And I think that is the, you know, the thing I would say that I'm particularly continuing to be pleased with is the level of focus within the organization on the goals, the objectives, and what's important. And when you create focus with 15,000 plus people, you can get results. And that's exactly what you're seeing. And I see no reason that it won't continue. No, it's definitely an impressive performance. That's why I was just, you know, I want to make sure I can start thinking about it as this is the level as opposed to

Speaker Change: <unk>.

Speaker Change: On the goals objectives, what's important and when you create focus was 15000 plus people you can you can get resolved and thats exactly what youre seeing and I see no reason that won't continue.

Roger Read: No, it's definitely an impressive performance. That's why I was just, you know, want to make sure I can start thinking about it as this is the level as opposed to, you know, just a good quarter. If I were you, if I were you, that's the way I would start thinking of it. Okay, great.

Speaker Change: No. It's definitely an impressive performance. This was just one.

Speaker Change: I want to make sure.

Speaker Change #122: I can start thinking about it as this is the level as opposed to.

Roger Read: If I were you, that's the way I would start thinking of it. Okay, great. And then the last question I had, just what is the right way in terms of share repurchases, you've hit the debt targets? Reiterate for us where we should see that shake out on a quarterly basis. Yes, sir.

Speaker Change: Just a good quarter.

Speaker Change: If I were you performance if I were you that's the way I would start thinking of it.

Speaker Change: Okay great.

Kristopher Smith: And then the last question I had, just what's the right way in terms of share repurchases? You've hit the debt. as we could just reiterate for us where we should see that shake out on a quarterly basis. Yeah, sure, Roger. We laid that out. This is Chris. We laid that out at the May 21st update. So we've moved to a 75% share by back 25% debt reduction allocation of access refunds flow. So once we get to the $8 billion net debt target, which we talked about on May 21st and a bit earlier on this call, then we're going to move ourselves to 100% shareholder return allocation.

Speaker Change: And then the last question I had just what's the right way in terms of share repurchases you've hit the debt targets. If you could just reiterate for us where we should see that shake out on a quarterly basis.

Roger Read: Yeah, sure, Roger. We laid that out. This is Chris.

Speaker Change: Yes, sure Jay we laid that out this is Chris we laid that out at the May 21st update so we've moved to a 75% share buyback 25% debt.

Speaker Change: Debt reduction allocation.

Speaker Change: Excess free funds flow once we get to the $8 billion net debt target.

Chris Smith: We laid that out at the May 21st update. So we've moved to a 75% share buyback, 25% debt reduction allocation of excess refund flow. Once we get to the $8 billion net debt target, which we talked about on May 21st and a bit earlier on this call, then we're going to move ourselves to a 100% shareholder return allocation.

Speaker Change: <unk>, which we talked about on May 21.

Speaker Change #100: Earlier on this call that we're going to move ourselves to a 100% shareholder return allocation.

Kristopher Smith: And is there a, I guess, again, kind of getting back to Neil's question earlier about working capital? I mean, assume that on an annual basis and then make the adjustments on a quarterly. Yeah, that's exactly right. That's what we think about it. Okay. Thank you. Yeah. Thank you. One moment for our next question. And that will come from the line of Menno Hulshof with TD Cowan. Your line is open. Thanks and good morning, everyone. I'll start with a question on the strong beat on production. Rich, you provided a lot of detailing or prepared remarks, but could you maybe loosely quantify how much production uplift you got from faster than expected completion of turn around versus pure.

Roger Read: And is there, I guess, again, kind of getting back to Neil's question earlier about working capital, I mean, assume that on an annual basis and then make the adjustments on a quarterly basis? Yeah, that's right.

Speaker Change #101: And is there a.

Speaker Change #101: I guess again kind of get back to Neil's question earlier about working capital I mean, let's assume that on an annual basis and then.

Speaker Change #101: Adjustments on a quarterly.

Chris Smith: Yeah, that's exactly right. That's the way I think about it. Okay.

Speaker Change #102: Yes, that's exactly right that's the way to think about it.

Speaker Change #102: Okay. Thank you.

Operator: Thank you. One moment for our next question, and that will come from the line of Menno Hulshof with TD Cowan. Your line is open.

Speaker Change #102: Yes.

Speaker Change #104: Thank you one moment our next question.

Speaker Change #104: And that will come from the line of Menno <unk> with TD Cowen Your line is open.

Menno Hulshof: Thanks and good morning, everyone. I'll start with a question on the StrongBeat for production. Rich, you provided a lot of detail in your prepared remarks, but could you maybe loosely quantify how much production uplift you got from faster than expected completion of turnarounds versus pure outperformance of the assets? And then, I guess the follow-up to that, and this is more a point of confirmation, but was there any maintenance activity deferred in a quarter? And if so, what was the thinking behind that?

Menno: Thanks, and good morning, everyone.

Menno: I'll start with a question on the strong beat on production Rich you provided a lot of detail in your prepared remarks, but could you maybe loosely quantify how much production uplift you got from faster than expected completion of turnarounds versus like pure outperformance of the assets and then I guess the the.

Menno Hulshof: I perform for the assets. And then I guess the follow up to that. And this is more a point of confirmation. But was there any maintenance activity deferred in the quarter? And if so, what was the thinking behind that? Yeah, you know, take that in reverse. We did everything in the quarter. We had planned to do in our business plan, so there were no deferrals and things. So I commented on the upstream that we had 12 additional kinds of days. They weren't full days because they were parts of the assets. So, for example, you know, Syncrood had relative to plan seven days of additional eight, three cocker runtime.

Speaker Change #106: Follow up to that and this is more a point of confirmation, but was there any maintenance activity deferred in the quarter and if so what was the thinking behind that.

Rich Kruger: Yeah, you know, take that in reverse. We did everything in the quarter we had planned to do in our business plan. So there were no deferrals and things. So I commented on the upstream that we had 12 additional kind of days. They weren't full days because they were part of the assets. So, for example, you know Syncrude had, relative to plan, seven days of additional 8.3 COPR runtime. Other things that I would say is Peter's team, to my pleasant surprise, as they looked at the turnaround work, said, all right, what else can we do elsewhere across the asset base to offset that? So we were probably, maybe, Peter, 30,000 barrels a day or so higher than what we might have thought that our internal plan would have been.

Speaker Change #106: Yes.

Speaker Change #107: Ill take that in reverse we did everything in the quarter. We had planned to do in our business plan. So there were no deferrals and things. So I commented on the upstream that we had 12 additional kind of days they weren't full days because they were parts of the assets. So for example, Syncrude had.

Speaker Change #108: <unk> plan to seven days of additional eight III Coker run time.

Richard Kruger: We, other things that what I would say is Peter's team to the my pleasant surprise as they looked at the turnaround works and all right, what else can we do elsewhere across the asset base to offset that? So we were probably what maybe Peter of 30,000 barrels a day or so higher than what we might have thought about our internal plan. What has been? I think that's a fair assessment. And again, it comes back to looking at this as an integrated production system. And so we're moving, you know, sour barrel, some base plan to Syncrood to take advantage of some high to treating capacity that we have there.

Peter Zebedee: Other things are what I would say is peters team to the my Pleasant surprise.

Speaker Change #109: They looked at the turnaround work said all right what else can we do elsewhere across the asset base to offset that so we were probably.

Peter Zebedee: What maybe Peter.

Peter Zebedee: 30000 barrels a day or so higher than what we might have thought that that our internal plan would have been I think thats, a fair assessment and again it comes back to looking at this as an integrated production system. So we're moving sour barrels some base plant to send crude to take advantage of some hydro treating.

Peter Zebedee: I think that's a fair assessment. And again, it comes back to looking at this as an integrated production system. So we're moving, you know, sour barrel, some base plant to Suncor to take advantage of some hydrotreating capacity that we have there. We're looking to, as Shelley said, really minimize the scope and execute within a well-defined window and set ambitious targets for the team that they, you know, frankly, were able to achieve this year. So it's kind of a, we're pulling all the levers here to get the maximum value that we possibly can.

Peter Zebedee: The city that we have there we're looking to as Shelly said really minimize the scope and execute within our well defined window and set ambitious targets for the team.

Richard Kruger: We're looking to, as Shelley said, really minimize the scope and execute within a well-defined window and set ambitious targets for the team that they, you know, frankly, were able to achieve this year. So it's kind of a report of all the levers here to get the maximum value that we possibly get. And I think, you know, I think one of the things that it comes back to on me, and I mentioned we were at Four Hills last week, Firebag a few weeks earlier, is the potential of the organization. I don't think we could sit here on the phone today and tell you we fully understand the full potential yet because the organization continues to exceed what we think are challenging expectations.

Shelly: Frankly, we're able to achieve this year. So it's kind of a we're pulling all the levers here to get the maximum value that we passed.

Rich Kruger: And I think, you know, Menno, I think one of the things that it comes back to me, and I mentioned we were at Fort Hills last week, Firebag a few weeks earlier, is the potential of the organization. I don't think we could sit here on the phone today and tell you we fully understand the full potential yet because the organization continues to exceed what we think are challenging expectations, and that is a lot of fun. And you can see that energy and enthusiasm. I will use some of the examples at Firebank in terms of adding or debottlenecking at low or no cost.

Speaker Change #111: I think one of the things that it comes back to you on me and I mentioned, we were at Fort Hills last week fire bag a few weeks earlier is.

Shelly: The potential of the organization.

Shelly: Don't think we could sit here on the phone today and tell you we fully understand the full potential yet because the organization continues to exceed what we think are challenging expectations and the.

Richard Kruger: And that is a lot of fun. And you see that energy and enthusiasm. I use some of the examples at Firebag in terms of adding or debilitating at lower no cost. You're seeing that across the upstream and downstream. And I don't know if we'll continue to beat like we did on this quarter. I continue to be pleasantly surprised at the organization's ability to creatively find ways to exceed expectations. And that makes for a lot of fun. Terrific, and maybe I'll just sort of continue along the sort of continue the conversation on the turnaround side of things.

Shelly: And that is a lot of fun.

Shelly: You see that energy and enthusiasm I use some of the examples at fire bag in terms of adding or debottlenecking at low or no cost youre seeing that across the upstream and downstream and I don't know if we'll continue to beat Ike we did on this quarter, but.

Menno Hulshof: You're seeing that across the upstream and downstream. And I don't know if we'll continue to beat like we did this quarter, but I continue to be pleasantly surprised at the organization's ability to creatively find ways to exceed expectations, and that makes for a lot of fun.

Shelly: I continue to be pleasantly surprised at the organization's ability to creatively find ways to exceed expectations and that makes for a lot of fun.

Rich Kruger: Terrific. And maybe I'll just sort of continue the conversation on the turnaround side of things. Rich, you mentioned extended intervals between turnarounds are one of the next potential focus areas. What is your best guess on what that could look like and which assets are most likely to benefit?

Shelly: Terrific and maybe I'll just sort of continue.

Shelly: Along the sort.

Shelly: Sort of continue the conversation on the turnaround side of things Rich you mentioned the extended.

Rich Kruger: Intervals between turnarounds is one of the next potential focus areas. What is your best guess on what that could look like in.

Richard Kruger: What is your best guess on what that could look like and which assets are most likely to benefit first? I think it comes in two areas. This is kind of building off a Shelley's comments. As we look at individual pieces of equipment, you may have a turnaround and an upstream or downstream facility, but component parts of that turnaround. We may look at and instead of doing a three-year interval, we may convince ourselves that we have sufficient information to go five-year interval on component parts. So that would shorten the overall duration of a turnaround, but we might still have a turnaround at that facility every so often.

Rich Kruger: Which assets are most likely to benefit.

Rich Kruger: I think it comes in two areas, and this is kind of building off of Shelley's comments. As we look at individual pieces of equipment, you may have a turnaround at an upstream or downstream facility, but component parts of that turnaround, we may look at, and instead of doing a three-year interval, we may convince ourselves that we have sufficient, you know, information to go five-year intervals on component parts. So that would shorten the overall duration of a turnaround, but we might still have a turnaround at that facility every so often. So that's part of it.

Rich Kruger: I think it comes in two areas in this kind of building off of Shelley's comments as we look at individual pieces of equipment. You may have a turnaround at an upstream or downstream facility, but component parts of that turnaround. We may look at and instead of doing a three year interval, we may convince ourselves.

Rich Kruger: Wells that we have sufficient.

Rich Kruger: Formation to go five year interval.

Rich Kruger: Component parts, so that would shorten the overall duration of a turnaround, but we might still have a turnaround at that facility. Every so often so thats part of it the bigger opportunity is if we can just simply extend the intervals on entire turnaround I think that's a bigger question for us right now.

Richard Kruger: So that's part of it. The bigger opportunity is if we can just simply extend the intervals on entire turnaround. I think that's a bigger question for us right now, but I think the prize, if we get into it, and I'll go back to the May 21st deck where we have kind of the target of the capital cost reduction that we believe we can achieve as we go from third and fourth quartile in turnaround to first and second quartile. Now, that continues to be the right magnitude of the prize. The added benefits that we're still quantifying is as we have more days on production.

Shelley Powell: The bigger opportunity is if we can simply extend the intervals on entire turnarounds. I think that's a bigger question for us right now. But I think that the prize, if we get into it, and I'll go back to the May 21st deck, where we had kind of the target of the capital cost reduction that we believe we can achieve as we go from the third and fourth quartile in turnarounds to the first and second quartile, that continues to be kind of the right magnitude of the prize.

Rich Kruger: But I think the prize if we get into it and I'll go back to the May 21.

Rich Kruger: Where we had kind of the target of the capital cost reduction that we believe we can achieve as we go from third and fourth quartile in turnarounds to first and second quartile that continues to be the kind of the right magnitude of the price.

Shelley Powell: The added benefits that we're still quantifying are, as we have more days on production, what is that benefit? And that, I think, is a further upside to what we've shown in the May 21st decade. Shelley, do you have any other comments, or Peter, do you have any other comments on that? Peter, I saw you raise your hand there.

Speaker Change #112: The added benefits that we're still quantifying is as we have more days on production what is that benefit and that I think is a further upside to what we've shown in the May 20, <unk> that Shelley <unk> any other or Peter do you have any other comments on that Peter.

Peter Zebedee: What is that benefit, and that I think is a further upside to what we've shown in the May 21st deck. Shall we give any other Peter, do you have any other comments on that Peter? You I saw you raise your hand there. And we've got a couple of specific examples. We're really looking across the entire upgrading base, and we're guided by Solomon. So our strategies are rooted in benchmarking on where they're clear opportunities. You know, there's some good examples of sync rooted looking at decoupling the units at looking at extending turnaround units or turnaround intervals.

Speaker Change #112: Raise your hand.

Peter Zebedee: We've got a couple of specific examples, Menno. We're really looking across the entire upgrading base, and we're guided by Solomon, so our strategies are rooted in benchmarking where there are clear opportunities. You know, there are some good examples of Suncor that are looking at decoupling the units, looking at extending turnaround units, or turnaround intervals, so like that tower from three years to six years, the recovery units from four years to six years, higher tiers, three years to six years. So we have very specific plans that are asset by asset, informed by Solomon, and a similar thing at the base plant. So I still think there's lots of opportunity in the turnaround space that we're going after.

Speaker Change #114: We've got a couple of specific examples.

Speaker Change #115: We're really looking across the entire upgrading base and we're guided by Solomon. So our strategies are rooted in benchmarking on where there are clear opportunities.

Speaker Change #116: Theres some good examples of the Syncrude at looking at decoupling the units at looking at extending turnaround units our turnaround intervals. So like dark tower from three years to six years diluent recovery units from four years to six years higher tiers three years or six years. So we have very specific plans that are asset by asset and.

Peter Zebedee: So like backtower from three years to six years, the daily recovery units from four years to six years, higher tiers, three years to six years. So we have very specific plans that are asset by asset informed by Solomon and similar thing at base plan. So I still think there's lots of opportunity in the turnaround space that we're going after, some of these given the intervals and the cycles will take some time to play out in the coming years. But rest assured our engineering teams and the site teams are really laser-focused on making a big difference here.

Speaker Change #115: <unk> on that.

Speaker Change #115: Similar thing at base plant. So I still think there's lots of opportunity in the turnaround space that we're going after some of these given the intervals on the cycles will take some time to play out in the coming years.

Rich Kruger: Some of these, given the intervals and the cycles, will take some time to play out in the coming years, but rest assured, our engineering teams and the site teams are really laser-focused on making a big difference here, and the end result is more uptime, improved safety, improved reliability, and improved turnaround efficiency, which is the bottom line of Free Funds Flow. And just to comment on that, we've talked in the past about how we had gotten a bit lax on benchmarking.

Speaker Change #115: But rest assured our engineering teams and our site teams are really laser focused on.

Speaker Change #115: We're making a big difference here and at the end result is more uptime.

Richard Kruger: And the end result is in more up time, improved safety, improved reliability, and improved turnaround efficiency, which is a bottom line free funds flow increase. Just to comment on that, we've talked in the past about how we had gotten a bit lost on benchmarking. Today's son core is all about benchmarking. We want to know who the best of the best is, why they're better than us, and then what we can do to then close that gap and then exceed that performance. So I mentioned before that we had not participated in the most recent Solomon survey or two Solomon, the holy grail on, you know, plant benchmarking.

Speaker Change #115: Improved safety improve reliability and improved turnaround efficiency, which is a bottom line free funds flow increase.

Speaker Change #117: To comment on that we've talked in the past about how we had gotten a bit last on benchmarking. Today's suncor is all about benchmarking, we want to know who the best of the best is why why they are better than us and then what we can do to then close that gap and then exceed that performance. So I had mentioned before that we have.

Rich Kruger: Today's Suncor is all about benchmarking. We want to know who the best of the best is, why they're better than us, and then what we can do to then close that gap and then exceed that performance. So I mentioned before that we had not participated in the most recent Solomon survey or two, Solomon the Holy Grail on plant benchmarking. I'm not getting any commission for plugging Solomon on this.

Speaker Change #117: Not participated in the most recent Solomon survey over to Solomon the Holy Grail on.

Speaker Change #118: Benchmarking I'm not I'm not getting any commission for plugging Solomon on this but Shelly and Dave reached out and said you know the next survey is next year, that's too long for US we want to get in and get the most recent update of where we benchmark and Solomon did that for us and we have their president.

Richard Kruger: I'm not getting any commission for plugging Solomon on this, but Shelley and Dave reached out and said, you know, the next survey is, you know, next year; that's too long for us. We want to get in and get the most recent update of where we benchmark, and Solomon did that for us. And we have their president and their see their leadership team here with us two weeks ago, and we sat down one afternoon going item by item across our business, where we have room for improvement. And I think, well, now as we take that back into our broader plans and individual facilities, I think we're going to find and identify areas to improve even beyond what are kind of our initial expectations of that.

Rich Kruger: But Shelley and Dave reached out and said, you know, the next survey is, you know, next year. That's too long for us. We want to get in and get the most recent update on where we benchmark, and Solomon did that for us. And we had their president and their leadership team here with us, what, two weeks ago? And we sat down one afternoon going item by item across our business, where we have room for improvement.

Speaker Change #118: The leadership team here with us like two weeks ago, and we sat down one afternoon item by item across our business, where we have room for improvement I think now as we take that back into our broader plans and individual facilities.

Rich Kruger: And I think now, as we take that back into our broader plans and individual facilities, I think we're going to find and identify areas to improve even beyond what are our initial expectations at that point.

Speaker Change #118: I think we're going to find and identify areas to improve even beyond what our kind of our initial expectations have been.

Menno Hulshof: I appreciate the thoughts. I'll turn it back.

Operator: I appreciate the thoughts. I'll turn it back. Thank you. That concludes today's question-and-answer session. I would now like to turn the call back over to Mr. Troy Little for any closing remarks. Thank you, everyone, for joining our call this morning. If you have any follow-up questions, please don't hesitate to reach out to our team operator. You can end the call. This concludes today's program. Thank you all for participating. You may now disconnect.

Speaker Change #119: I appreciate the thoughts and ill turn it back.

Troy Little: Thank you. That concludes today's question and answer session. I would now like to turn the call back over to Mr. Troy Little for any closing remarks.

Speaker Change #119: Thank you that concludes today's question and answer session I would now like to turn the call back over to Mr. Troy Little for any closing remarks.

Operator: Thank you everyone for joining our call this morning. If you have any follow-up questions, please don't hesitate to reach out to our team. Operator, you can end the call.

Troy Little: Thank you everyone for joining our call. This morning, if you have any follow up questions. Please don't hesitate to reach out to our team operator, you can end the call.

Operator: This concludes today's program. Thank you all for participating. You may now disconnect.

Speaker Change #121: This concludes today's program. Thank you all for participating you may now disconnect.

Speaker Change #121: [music].

Speaker Change #121: Okay.

Operator: If you had one shot of one opportunity, everything you ever wanted.

Speaker Change #121: Sure.

Speaker Change #123: If you add.

Speaker Change #124: One shack.

Speaker Change #124: One opportunity.

Speaker Change #124: Is everything you ever wanted.

Speaker Change #124: One moment.

Speaker Change #124: Cash and.

Speaker Change #124: Glen.

Speaker Change #124: No.

Tom Bailey: Hey, Tom it's wedding needs, we call diabetes.

Tom Bailey: [music].

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Tom Bailey: [music].

Operator: I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here, but I know you're here.

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