Q3 2024 Kinder Morgan Inc Earnings Call
Speaker Change: Welcome to the Quarterly earnings conference call. At this time, all participants are not listening on the mode. During the Q&A session, if you'd like to ask a question, a press star or one on your phone. Today's call is being recorded if you have any objections, please disconnect at this time. Now it's from the call over to Mr. Rich Kinder, Executive Chairman of Kinder Morgan.
Rich Kinder: Okay, thank you, David, before we begin as usual, I'd like to remind you that, okay, my earnings release today and this call
Rich Kinder: including Paul the Lucky Statements within the meeting of the private securities litigation reform act of 1995.
Rich Kinder: and the Securities Exchange Act of 1934.
Rich Kinder: as well as certain non-GAAP financial measures. Before making any investment decisions we strongly encourage you to read our full disclosure on forward-looking statements and use of non-GAAP financial measures set forth at the end of our earnings release, as well as review our latest following with the SEC for important material assumptions, expectations and risk factors that may cause actual results to differ materially from those anticipated and described in such forward-looking statements. Over the past few quarters, I've talked about our view of the future demand for natural gas.
Rich Kinder: with strong growth being driven by LNG exports, exports to Mexico and electric generation which is benefiting from the tremendous needs of AI and data centers. Our viewpoint is consistent with most other energy leaders and analysts in the field. So the next question is, what's the impact of this growth on a midstream company like Kinder Morgan? We believe it's substantial and positive.
Speaker Change: In fact, in my decades of experience in the mid-term arena, I've never seen a macro-environment so rich with opportunities for incremental build-out of natural gas infrastructure. And at Kinder Morgan, we expect to be a major player in developing that infrastructure. In July, we announced the approximate $3 billion South System expansion for project.
Speaker Change: which is underpin by long-term shipper commitments and designed to increase our southern natural gas self-line capacity by approximately 1.2 BCF per day, helping to meet growing power generation and residential commercial demand in the Southeastern U.S. market.
Speaker Change: Today we are announcing the expansion of our GCX system in Texas, which will enable our customers who have signed long-term throughput agreements to move substantial additional gas out of the Permian Basin.
Speaker Change: We expect to announce additional significant projects over the next several months that will allow us to expand and extend our network to better serve the needs of our customers and benefit our bottom line.
Speaker Change: As these projects come online, we should be able to grow our EPS EBITDA and DCF on a consistent and sustainable basis for years to come and with that I'll turn it over to Kim.
Kim: Okay, thanks, Richard
Kim: I'll make a few points and then I'll turn it over to Tom and David to give you more details.
Kim: But for the fourth quarter, earnings per share was unchanged, even dog grew by 2% versus the third quarter of last year.
Kim: For the year, we expect EBITDAGRO's to 5% and EPS growth of 9% versus 2023.
Kim: Despite our expectation to be slightly below our budget due to lower commodity prices.
Kim: and Slow Start-up of our Harring G facilities. That to EBITDA remains a 4.1 times.
Speaker Change: During the quarter we added roughly 450 million of projects to the backlog, which includes the GCX expansion that Rich mentioned, but also includes a storage expansion on NGPL and a new lateral to serve a natural gas tower plan.
Speaker Change: We placed roughly 500 million of projects in service resulting in a current backlog of 5.1 billion.
Speaker Change: As we look to the future, we continue to see large opportunities for growth and natural gas between LNG, exports to Mexico, power and industrial growth.
Speaker Change: Current discussions on power opportunities total well north of the 5 BCF a day we mentioned in the second quarter.
Speaker Change: Our internal number for growth in the overall natural gas market is roughly 25 BCF a day over the next five years.
Speaker Change: On the power side there are numerous drivers of that demand.
Speaker Change: We see population and business migration to the southern United States from Arizona to Texas to Georgia and Florida and what we're already tight energy markets.
Speaker Change: The Chips Act, Cheap Feets.Prices and National Security are leading to on-shoring and near-shoring.
Speaker Change: Renewables are leading to the need for more natural gas pickers plants to back up intermittent demand.
Speaker Change: Coal Plants are moving forward with conversion, and of course, data center demand has skyrocketed. Regardless of the demand driver, one project often creates a need for a subsequent project. For example, an LNG facility initially builds or contracts for a header pipe to get natural gas to its facility from the closest liquid market. Over time, it contracts for capacity upstream of that liquid point to secure more attractively priced molecules.
Speaker Change: In addition, we have seen some of these companies subscribe for capacity on an entirely separate path to achieve diversity of supply.
Speaker Change: We see somewhat similar dynamics on the LDC of power demand side. Project to expand existing pipeline capacity within the demand areas and then a desire to reach further back to ensure sufficient and diverse supply.
Speaker Change: Kiner reminds me of the old song by the fix. One thing leads to another.
Speaker Change: As we look at our future opportunities, a few of the potential projects are very large, one in a half to two billion. Most are singles and doubles.
Speaker Change: As I said last quarter, not all the projects will come to fruition and the larger projects can take longer to develop, but the opportunity set has continued to increase over the course of this year and the conversations are becoming more focused and specific.
Speaker Change: As Rich mentioned, we've already approved two large projects, totaling $3.6 billion, $8.8 billion, 1.8 billion to KM share between southern natural gas, the southern natural gas, south system, 4 projects and the GCX expansion.
Speaker Change: and I expect those rich said we'll continue to add to this backlog. It's an exciting time to be in the midstream business. And with that, I'll turn it over to Tom to give you more details. Thanks, Jim.
Tom: Starting with the natural gas business unit, transport volumes increase 2% in the quarter versus the third quarter of 2023.
Tom: Natural Gas Gathering Volumes are up 5% in the quarter compared to 2023 driven by Hainesville and Eagleford Volumes which are up to 10% and 9% respectively.
Tom: It's a coincidentally total gathering volumes for down to 5% The year we expect gathering volumes to average 8% below our 2024 plan, but 5% over 2023.
Tom: We view the slight pull back and gathering volumes as temporary as higher production volumes will be necessary to meet the demand growth from LNG expected in the second half of 2025.
Tom: Looking forward, we continue to see significant incremental project opportunities across our natural gas pipeline network to expand our transportation and storage capabilities and support of the growing natural gas market.
Tom: In our product pipeline segment, refined product volumes are up 1% including condensate volumes, we're down 4% in the quarter compared to the third quarter of 2023.
Tom: For the full year we expect refined products, volumes to be slightly below our plan, but 2% over 2023.
Tom: We're guarding development opportunities, chemise, SFP, pipeline closed a successful binding open-season during the quarter to add 2,400 barrels per day of additional refined petroleum products capacity.
Tom: on its East Line System for transportation services from El Paso, Texas to Tucson, Arizona. The project can be expanded further and is expected to be in service during the third quarter of 2025.
Tom: and our terminal's business segment, our liquids release capacity remains high at 95%.
Tom: Refining cracks and blending margins go down from recent highs, remain constructive and supportive of strong rates and high utilization at our key hubs in the Eastern Ship Channel in New York Harbor.
Tom: Our Jones Act tankers are under percent least through 2024 and 97% least in 2025, assuming likely options are exercise.
Tom: The current market rates remain above our fleet average charter rate and we expect to re-contract at higher charter rates as contracts come up for renewal.
Speaker Change: The CO2 segment experienced lower-world production volumes at 6% lower in GL volumes at 3% and higher CO2 volumes at 3% in the quarter versus a third quarter of 2023. For the full year we expect oil volumes to be roughly flat to budget.
Speaker Change: The Board approved two projects today associated with our acquisitions over the last couple of years. These projects include the development of a CO2 flood at the undeveloped leasehold adjacent to Sacrock that we acquired in June.
Speaker Change: and the second phase of the CO2 flood development at Diamond M.
Speaker Change: We expect to spend a combined $145 million on these projects resulting in a peak oil production of greater than 5,000 barrels a day with that. I'll turn it over to David Michels. Thanks, Tom.
David Michels: So for the quarter we're declaring a dividend of 28.75 cents per share, which is a dollar 15 annualized up 2% from our 2023 dividend.
David Michels: For the quarter, we generated revenue of $3.7 billion down to $28 million from the third quarter of 2023. However, cost of sales were also down, those were down by $381 million.
David Michels: and so putting those two together grows margin increased 7% versus last year.
David Michels: Additionally, we generated net income attributable to KMI of $625 million and earnings per share of 28 cents, both 17% higher than the third quarter of 2023.
David Michels: On an adjusted net income basis, which excludes certain items, we generated $557 million and adjusted EPS of 25 cents, which is flat with last year.
David Michels: We saw a year over year growth from our natural gas and terminal businesses. The main drivers were contributions from our acquired cell-toxest midstream assets, greater contributions from our natural gas transportation and storage services across our networks, as well as higher growth project contributions.
David Michels: Our product segment was down mainly due to lower commodity prices and the associated impact on our inventory valuations.
David Michels: BCF per share was 49 cents, flat with last year. We experienced higher sustaining capital versus last year in the quarter, which is consistent with how we budget it for it. So the full year we expect sustaining capital to be in line with budget.
David Michels: So the quarter is pretty fly with last year, but if you look at a year-to-date on a year-to-date basis, performance is nicely up, the KPS is up to 9% over last year and our adjusted EPS is up 5% on a year-to-day basis versus last year.
Speaker Change: And as Kim mentioned while we expect to turn a little bit below budget for the full year, we expect our full year adjusted even down to be 5% higher than 2023 and our adjusted EPS to be 9% higher than 2023.
Speaker Change: On our balance sheet, we ended the third quarter with $31.7 billion of net debt, and 4.1 times net debt to adjusted Eva Dow.
Speaker Change: which is consistent with where we budget it to end the quarter.
Speaker Change: Our net net has decreased $150 million from the beginning of the year and here's a high-level reconciliation of how that changed occurred.
Speaker Change: who generated $4.2 billion of cash flow from operations.
Speaker Change: We've spent $1.9 billion in dividends
Speaker Change: We've spent $2 billion in total capex that includes growth, sustaining, and our contribution towards joint ventures and we've had $50 million approximately of other working capital uses and that gets you close to the $150 million decrease in that debt for the year.
Speaker Change: Now I'll turn it back to Kim. Thanks David. If you'll come back on, we'll open it up to questions. If you'd like to ask a question over the phone, please press star 1 and record your name to withdraw your question.
Speaker Change: The first question the key was from John McCuy with Golden Sacks, your line is open.
John McCuy: Hey everyone, thank you for the time.
John McCuy: Look, you've seen a lot of time again talking about the growth potential that you're seeing.
John McCuy: coming back across.
John McCuy: Power, et cetera.
John McCuy: Yves.
Speaker Change: You have a couple projects that are floating around, kind of not quite in the backlog yet. I guess we used to call that shadow backlog. I guess I'd just be curious if you could kind of frame up the size of that relative to, let's say, this time last year. And then if you could maybe touch on in that context, maybe Mississippi Crossing and try to, that'd be great. Thank you.
Speaker Change: Sure. I mean, I think, as I said earlier, you know, the opportunity set has continued to increase versus
Speaker Change: from the start of this year, and even more since this time last year. And so, I mean, we don't technically have a shadow backlog, but if we did, I would expect that you would see a big increase in that. And so those projects arrange a lot of singles and doubles, which are great. I think those projects have less risk, and they are generally built off of our existing network and they're very nice returns. And then we have some that could be much larger. But if you look at, for example, the power opportunity.
Speaker Change: You know, we are talking to you know, powder plants in Arizona and Arkansas in Texas and Mississippi and Louisiana in Wisconsin.
Speaker Change: and Colorado and then obviously, you know, we're addressing the Georgia need through the South System 4.
Speaker Change: You know, things you're seeing on a industrial side, you know, you're seeing battery plants and chip plants in Arizona, you're seeing auto plants in Georgia, petrochemical plants on the U.S. That's, you know, driven by the on-shoring that's driven by the Chips Act, and that's driven by the fact that we've just got very cheap commodity prices here, so cheap feed stock for these petrochemical plants.
Speaker Change: On the exports of Mexico, that's driven by power plants, that's driven by near-shoring, that's driven by export LNG. We've got CCS opportunities on petroleum products side, we've got a number of blending opportunities we're working on.
Speaker Change: There's opportunities on the storage side, as I said today, we NGPL added a 10 BCS storage opportunity. We added our share of that to the backlog.
Speaker Change: and so, and then, you know, unnatural gas. So, our backlog itself has grown significantly from last year. I don't remember the exact number but I think it was in the threes or below this time last year and now we're over five. So, you know, that gives you, that gives you some sense of the things that, that we're saying, you know, also since this time last year, you know, we were saying one to two billion dollars a year in expansion cap X and we updated that more recently to say two billion dollars in expansion cap X per year. So...
Speaker Change: You know, those are all signs of, you know, of how we see this opportunity set on the MSX project. I'll let people talk about that for the open season. Yeah, John, this is people so, you know, as we've been talking about the last couple of calls.
Speaker Change: You know, we've got two open seasons out there, you know, our theme, you know, we've been saying for a while.
Speaker Change: that we've got a need for more molecules to move from west to east.
Speaker Change: So what you have is two open seasons, one with Mississippi Crossing and one with Trident.
Speaker Change: that basically is getting molecules to where they're needed. Mississippi Crossing can be scaled up to 2BCS to get to the Southeast markets. Obviously to feed some of the Southeast customers that we're working with on South System 4. Trident is a project that gets gas from Katie all the way to the LNG court or in Port Arthur. And so we're excited about those projects. We're working with our customers. Neal is to say, both of them are in kind of a competitive space. So hopefully we'll have more to share on the next call as it pertains to those.
Speaker Change: and they just gave me the number on the backlog, third quarter last year was 3-8, so we've gone from 3-8 to 5-1, so that's a 34% increase in the backlog.
Speaker Change: Alright, that's great color, appreciate all that. I think just...
Speaker Change: Second question.
Speaker Change: You know, we're going into guidance two months from now obviously not going to ask you on specific numbers or anything, but if we look at where 24 has trended versus
Speaker Change: and initial guidance. Big part of that has been...
Speaker Change: Commodity softness, we can debate over how much that is transitory or not, but can you talk about maybe other puts and takes inside the business that are trending You know better or slightly softer than expected outside of commodity and just maybe generally how some of those can you know how they'll trend into 25
Speaker Change: Europe.
Speaker Change: So, you know, on the natural gas side, obviously got the commodity impact and that's impacting gathering.
Speaker Change: Volumes. And so we've seen some weakness versus our budget and you heard Tom address that in his comments on gathering volumes.
Speaker Change: On the other hand, you know, we have seen huge strength in, you know, the transmission
Speaker Change: Assets, and that's on transport contract, that's on storage, that's on pals.
Speaker Change: and so a lot of upside versus our original budget there that you know offsetting.
Speaker Change: The Downside, some of the downside that we see on commodity and the M.A.G.M.P volumes.
Speaker Change: Um...
Speaker Change: So, I think, you know, the question, when you start looking too early to talk about that, you know, I think the first half of the year, you know, probably looks a lot like 2024. I think as some of these export LNG volumes come on in the back half, whether that's, I think Corpus has got some volumes coming on. I think all the passion at the end of the year. And then I think there's some employment. So, I think, you know, with those volumes coming on, you know, that will lead to a stronger, stronger environment to some extent on, and part of that also depends on what kind of winter we have.
Speaker Change: But I think, you know, going into 25, you know, on the other business segments and say, you know, products and terminals have rate escalators. We've got some upside on Jones Act, interest rates are obviously going to be, obviously going to be a, a benefit to us, expansion projects, you know, getting our RNG facility stabilized and then, you know, we'll just have to see where GMP comes out and where we come out on commodity prices. And then I think, you know, cash taxes will probably go up a little bit, but we still will not be a, is overly significant cash tax payer.
Speaker Change: All right, that's fantastic for shit this time.
Speaker Change: Good next question, the Q is from Michael Bloom with Wells Fargo, your line is open.
Michael Bloom: Thanks, good afternoon everybody.
Michael Bloom: One to just stay on the topic of the percolating gas demand, gas projects.
Michael Bloom: Types of projects, but because it really is just talk about trend wise you see better returns on this project, but it seems like the south system for expansion was a really attractive multiples versus your total backlog. So just wondering if you're seeing that trend overall thanks.
Speaker Change: The returns that we're getting on these projects are pretty consistent with what we've achieved historically and what we've targeted.
Speaker Change: You know different projects you know come at different returns it depending on how long. It takes you to bring a project on.
Speaker Change: The multiple is likely going to be better to get to the same retiring because you've just got that you know you've got that capex drag on the front end.
But no. It's all system for is is not substantially different than you know the projects that we've done historically.
Thank you.
Speaker Change: The next question the cues from Theresa Chen with Barclays. Your line is open.
Speaker Change: Yes.
Speaker Change: Hey, Theresa.
Speaker Change: Okay.
Speaker Change: Sorry sucker there please check your mute button.
Speaker Change: Can you hear me now.
Speaker Change: Yeah, we can hear you sorry about that so looking at your Mississippi crossing project can you give us some color on the commercial drivers that.
That would allow kinder to win this project assuming the binding open season is successful do you think this is in part driven by customers' desire to diversify sources of supply beyond the typical northeast mid Atlantic corridor.
Speaker Change: Teresa a good question.
Speaker Change: One I think we've been saying before.
Speaker Change: With the advent of all of this LNG coming on in the Gulf Coast I think the markets are recognizing the need for incremental supply and this is not only diversification of supply, but actual access to physical molecules.
Speaker Change: To be able to handle the upcoming growth and so I think it reached.
Speaker Change: Reaching back to a point of liquidity.
Speaker Change: Access to different basins.
Speaker Change: In addition to the existing basins is kind of the play.
Speaker Change: Got it and then turning to a different part of your portfolio and with the recent success of one of your competitors in spinning out their liquids business any thoughts on separating your products business from your natural gas assets to potentially reflect better value in each.
Speaker Change: Yeah, I mean, I would say.
Speaker Change: That businesses that we own and operate we think there are or strategic to own them together, we get benefits from owning their own natural gas and products pipeline. For example on the integrity side you know our integrated team is one that goes across you know on the AR on the project management side, we get benefits.
Speaker Change: That and so you know I think there'll be certainly does synergies if if he spun those this is al I also don't think that you know if you're looking at some of the parks, where we're trading today. If you if you Peel those businesses apart and look at them.
Speaker Change: Versus where you'd look at the company together there is a significant discount and so you know there's not a big incentive tank car transaction cost synergy is probably on the G&A side and dis synergies potentially on the DAP side.
Speaker Change: That just depends on where interest rates are and timing would do a transaction like that.
Speaker Change: That that would that that would make sense right. Now you know, it's a very market dependent transaction and so you've got to have a.
Speaker Change: Very strong views about where the companies would trade in the aftermarket that are significantly different from some other parts in order to justify taking on that kind of a RASK of spending of breaking up the company.
Speaker Change: Thank you very much.
Speaker Change: Next question is from Zach event ever with T. P. H. Your line is open.
Speaker Change: Hey, guys. Thanks for taking my question maybe to start could you guys touch on the recent decision of the U S courts on your Cumberland projects and kind of what the processes there going forward.
Speaker Change: Yeah sure and so you know as as you know the six circuit State Our Army Corps, and our Tennessee, our air permits.
Speaker Change: Water water water permits.
Speaker Change: You know what that effectively does is it prevents us from starting construction on that project and we believe that decision is wrong. We believe the analysis is a flawed on multiple levels.
Speaker Change: Including the standard that they applied for this day.
Speaker Change: That's a project, where we are delivering natural gas.
To a natural gas power plant that is converting from coal and so you know here at the FERC found that that project would result in a reduction of greenhouse gas emissions. So it would be good from a greenhouse gas perspective over.
Speaker Change: Over the last 10 years, you know our paramount's, whether that's federal state local you'll have been challenged by anti fossil fuel opponents, regardless of the benefits. Besides the society, we have been very successful and and winning those court challenges you know recently on.
Speaker Change: The D C court of appeals they upheld our FERC permits on two separate projects. So we were also successful and other courts on state and local paramount's related to those projects and so we've had you know this isn't something that is new for us, but we're working with.
Speaker Change: With the impacted agencies, the Army Corps and T. D T D C a T.
Speaker Change: To determine next steps and you know I think both of those agencies are going to vigorously defend those permits.
Speaker Change: Perfect that makes sense and then maybe one on the Gulf.
Gulf Coast Express.
Speaker Change: I think when looking back to Permian Highway that took about a year is that a similar timeline you guys are looking for this expansion.
Speaker Change: Permian Highway took about 19 months you know here were probably you know.
Speaker Change: You know kind of conservatively, saying 22 months given given all the.
Speaker Change: There is quite a bit of demand on compression and then some of the electrical components.
Speaker Change: Components that being said you know we're.
Speaker Change: We're targeting a mid 26 in.
Speaker Change: In service date, so not quite the 19 months on PHP.
Speaker Change: We don't see we don't see it being that far out of the realm.
Speaker Change: Got it makes sense I appreciate the time guys.
Yeah.
[laughter].
Speaker Change: Next question is from Jean Ann Salisbury with Bank of America. Your line is open.
Speaker Change: Hi between the Gulf Coast expansion in Black come there's a lot of gas heading to the Agua Dulce area is there a risk that there won't be enough demand in the area in 'twenty, 'twenty, Texas, especially if LNG projects get delayed and how do you see that gtx expansion is positioned for that risk.
Speaker Change: So good very good question, you know I think.
Speaker Change: If there is any delay to the demand centers, particularly LNG demand centers.
Speaker Change: Could there be some pricing exposure yes.
Speaker Change: That being said for US you know part of the you know our discussion points had been you know we've got some downstream optionality on our networks for our customers.
Speaker Change: And so there is so that embedded optionality.
Speaker Change: <unk>.
Speaker Change: At the end of the day.
When you have that kind of variability, there's going to be some volatility, which you know which storage assets come into play and really that's where I think.
Speaker Change: That becomes increasingly important as we move towards that time frame.
A possibility, but not a probability we don't know yet.
Speaker Change: From our standpoint, we have long term contracts with shippers yeah. So we've got we've got long term contracts with the shippers all I'll point out that it's a potential for us to profit on our Texas Intrastate business, you know where are we do buy and sell some some gas I only tried to back to back those but sometimes we are in the daily markets.
And so to the extent that that gas gets it and I would also say and we've got capacity on our pipeline, we can buy effectively cheap gas and so that'll be an opportunity for us I think the other thing on that is we do have a project that we've been working on to potentially expand you know our pipeline systems.
Speaker Change: From Agua Dulce say up into Katy and so you know if you know that.
Speaker Change: That could create an opportunity for that project just depending on how long that dynamic was anticipated.
To persist.
That makes sense. Thank you.
Speaker Change: And then and at your Investor Day, you kind of mentioned that you have 200 bcf of market rate storage and bringing that up to current market rates is going to be kind of a tailwind is that still a tailwind that you see over the next couple of years and is that mainly still below kind of current rates if that makes sense.
Speaker Change: Yeah, it's about 25% of our storage is Ah is market based rate Samar that we have rolled and some of it we still have to roll, but in terms of the strength of the storage market.
Speaker Change: The strength of the storage market is continuing and rates I think.
Speaker Change: Our continuing to get a little bit stronger.
Speaker Change: You know on Monday, we talked about a three year deal that we'd done that was a high watermark for us on the storage side.
Speaker Change: That was <unk> five turn sour rest so I mean, that's very valuable storage, but.
Speaker Change: But we did hit a high watermark. So I think that's still going to be a tailwind, but you know those contracts probably roll over a three year period, roughly so you would probably roll a third of those a year.
Speaker Change: Great. That's helpful. That's all for me Thanks, a lot.
Speaker Change: Next question is from Neal Dingmann with true of Securities. Your line is open.
Neal Dingmann: That's what it all first my first question just more general on backlog him I'm wondering is it fair to assume that that we should think of your backlog maybe stay at around the $5 billion. Given you know number one it seems like you have a lot of opportunity you discussed, but you also have I know a number of projects that should come on to service in the coming quarters I'm just wondering how you would expect.
Speaker Change: Think about this [laughter], we haven't tried to do a roll forward of our backlog yet.
Speaker Change: So I can't really tell you exactly directionally, where we're going as I said, it's increased from 3.8.
Speaker Change: You know a year ago.
Speaker Change: We do have projects rolling off but I think you know, we there's a potential to add some significant projects. In addition to I think singles and doubles and.
Speaker Change: To the extent that we add there's really significant projects you know I think there is potential that that backlog grows.
Speaker Change: That's great to hear and then just secondly, I know, it's smaller but anything you could add on the C. O. Two portfolio specifics I know I think last quarter, you mentioned just likely no material change in capital spend there I'm just kind of will this continue to be the case I know you've got what given the development of sat Crockett Nortel and a variety of different things you know how should we think about.
Speaker Change: The debt portfolio.
Speaker Change: Yeah, I think Tom mentioned in his comments.
Speaker Change: Comments that we had just recently well this quarter, yes. This morning, our board approved a hot about $150 million.
Speaker Change: Projects a N C O two and those are really new C. O. Two floods and you know on peak production, that's going to get US an incremental 5000 barrels a day, which is a which is a pretty significant amount you know on a percentage basis of the existing production. So Anthony yeah.
Unknown Executive: And I'm showing no further questions at this time.
Unknown Executive: Okay, well thank you all for joining us this afternoon.
Unknown Executive: Have a good evening.
Unknown Executive: This concludes today's call.
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