Q4 2024 EOG Resources Inc Earnings Call
At this time for opening remarks, and introductions I would like to turn the call over to the Investor Relations Vice President of EOG resources. Mr. Pearce Hammond. Please go ahead Sir.
Speaker Change: Good morning, and thank you for joining us for the EOG resources fourth quarter 2024 earnings Conference call.
Speaker Change: The updated Investor presentation has been posted to the Investor Relations section of our website and we will reference certain slides during today's discussion.
Speaker Change: A replay of this call will be available on our website beginning later today.
Speaker Change: As a reminder, this conference call includes forward looking statements factors that could cause our actual results to differ materially from those in our forward looking statements have been outlined in the earnings release and Eog's SEC filings.
Speaker Change: This conference call May also contain certain historical and forward looking non-GAAP financial measures definitions and reconciliation schedules for these non-GAAP measures and related discussion can be found on the Investor Relations section of Eog's website.
Speaker Change: In addition, some of the reserve estimates on this conference call May include estimated potential reserves as well as estimated resource potential not necessarily calculated in accordance with the Sec's reserve reporting guidelines.
Jeff Leitzel: Participating on the call. This morning are every acre chairman and CEO, Jeff Leitzel Chief operating officer.
Janssen: And Janssen Chief Financial Officer.
Speaker Change: Keith Transco, Senior Vice President exploration and production and Lance <unk> Senior Vice President marketing and midstream Here's Ezra.
Speaker Change: Thanks, Paris, good morning, everyone and thank you for joining us.
Speaker Change: Yeah, Oh, geez consistent execution of our value proposition delivered another year of outstanding performance.
Speaker Change: Oil and total company production exceeded our original 2024 forecast while capital expenditures were on target.
Speaker Change: We also reduced cash operating costs year over year and increased our regular dividend, 7%. We earned $6 $6 billion of adjusted net income for a 25% return on capital employed.
Speaker Change: And in the four years since Covid, we have earned an average 28% return on capital employed and are outpacing the average of our peers and.
Speaker Change: And finally, we returned 98% of free cash flow through a combination of our regular dividend and share repurchases.
Speaker Change: Looking forward to 2025, EOG has never been better positioned to deliver long term shareholder value.
Speaker Change: Jeff will review, our 'twenty twenty-five capital plan in more detail in a moment however at a high level. Our plan builds on last year's success and is grounded in our commitment to.
Speaker Change: The first capital disciplined returns focused investments at a pace that supports continuous improvement across each of our assets.
Speaker Change: Operational excellence integrating organic exploration with best in class operational expertise proprietary information technology, and self sourced materials and marketing agreements to expand margins.
Speaker Change: Third sustainability, our commitment to safe operations, and leading environmental performance and fourth our culture.
Speaker Change: Fostering a decentralized organization and recognizing the value is created in the field at the asset level by collaborative multidisciplinary teams are utilizing technology to drive real time decisions and innovation.
Speaker Change: The depth and quality of Eog's diverse portfolio of unconventional resources is unmatched EOG holds more than 10 billion barrels of oil equivalent and resource potential that earns among the highest returns in our industry, averaging more than a 55% average direct after tax rate of return using our updated view on the bottom cycle pricing.
Speaker Change: A $45 oil and $2 50 natural gas.
Speaker Change: We continue to evaluate returns margins and payback period under several price scenarios remaining focused on optimizing half and full cycle returns with net present value to create shareholder value.
Speaker Change: The result of this comprehensive evaluation of investment across our portfolio is realized and our strong free cash flow generation and return on capital employed that we have delivered over the past few years and that we are positioned to deliver through the cycle.
Speaker Change: Our portfolio includes our core assets in the Delaware Basin, and Eagle Ford, which remain the largest areas of activity in the company.
Speaker Change: After more than a decade of high return drilling bolt assets deliver exceptional returns and top tier results, while operating at a steady pace.
Speaker Change: Our emerging South, Texas Dorado dry natural gas play in the powder River Basin and Utica combo plays are not only contributing to eog's success today, but laying the groundwork for years of future free cash flow generation and high returns.
Speaker Change: Another area of contributing into the foundation for future High return investment is on the international front.
Speaker Change: In Trinidad where we've been operating for over 30 years, we continue to identify high return projects due to our extensive knowledge of the regional subsurface. While also applying our cost conscious culture to remain capital disciplined and deliver projects that compete with our domestic portfolio.
Speaker Change: In 2024, we successfully constructed and set one new offshore platform sanctioned a new platform to be constructed and were awarded two new offshore blocks in the shallow water bid round hosted by the Trinidad and Tobago Ministry of energy.
Speaker Change: Also on the international front, we are excited to begin working on a new joint venture in Bahrain.
Speaker Change: We expect this to be the beginning of a long term partnership with FAP go energies to explore and develop an onshore unconventional tight gas prospect in Bahrain.
Speaker Change: The formation has previously been tested using horizontal technology delivering positive results.
Speaker Change: We are optimistic that applying our expertise in horizontal drilling and completions technology will enhance results and drive economics competitive with our domestic portfolio.
Speaker Change: Our partnership with Banco energies is a great example of stakeholder alignment and what we look for in international opportunities exceptional partners geopolitical stability scale and economics to compete with our domestic portfolio folio areas.
Areas with existing oilfield services, and ultimately reservoirs that can realize significant uplift through the application of horizontal drilling and completions.
Speaker Change: Shifting our outlook on the macro.
Speaker Change: Shifting to the to our outlook on the macro for more than two years oil prices have been remarkably range bound at a fairly robust 65 to $85 per barrel W. T I.
Speaker Change: Looking forward, we expect increased demand and low global inventories to offset the pending return of global spare capacity.
Speaker Change: Barring unexpected supply and demand shocks, we expect oil prices to continue to be similarly range bound this year.
Speaker Change: And on the natural gas side incremental reductions to gas inventories throughout the year were exacerbated this January when cold weather dramatically reduced inventories by approximately one tcf and drove inventories below the five year average for the first time in more than two years.
Speaker Change: Prices have strengthened accordingly, despite the modest return of shut in volumes.
Speaker Change: 2025, we expect additional support for prices from ongoing demand increases from natural gas power generation and the startup of several LNG facilities and the addition of our strategic marketing agreements over the past few years have positioned us.
Speaker Change: To grow into these markets as they develop.
Our cash flow priorities continue to focus on sustainable value creation.
Speaker Change: Disciplined capital investment and a pristine balance sheet support our growing regular dividend counter cyclic investments and additional cash returns all underpinned by a large resource base, providing long term visibility for high returns and strong free cash flow generation through the cycle now.
Speaker Change: Now here's an with details on our financial performance.
Speaker Change: 2024 was an outstanding year for EOG that highlights our continued financial strength and record shareholder returns in 2024, we invested $6 $2 billion in Capex, which drove annual production growth of 3% in oil and 8% in total company volume.
Speaker Change: In 2024 proved reserves increased by 6% to $4 7 billion barrels of oil equivalent which represents a 201% reserve replacement excluding price revisions.
Speaker Change: We also lowered finding and development costs, excluding price revisions by 7% to $6.68 per BLE.
Speaker Change: Outstanding financial performance allowed us to return a record $5 $3 billion to shareholders. This represented 98% of 2020 for free cash flow well in excess of our commitment to return a minimum of 70% of annual free cash flow to shareholders.
Speaker Change: Last year's record cash return was underpinned by a growing sustainable regular dividend, which remains the foundation of our cash return commitment.
Speaker Change: This commitment to our shareholders is based on our ability to continue to lower our cost structure and sustainably expand future free cash flow generation.
Speaker Change: We believe the regular dividend is the best indicator of the company's confidence in its future performance confidence we have consistently demonstrated through our history of dividend growth.
Speaker Change: We have never cut or suspended the dividend in our history and in fact, we have grown our dividend rate twice as fast as our peers average since 2019.
Speaker Change: Last year, we increased our regular dividend, 7% to an indicated annual rate of $3 90 per share.
Speaker Change: This 2.2 billion dollar annual cash return commitment currently represents nearly a 3% dividend yield.
Speaker Change: In addition to our regular dividend, we repurchased a record $3 $2 billion of shares in 2024 at an average price of $123 per share.
Speaker Change: Since we started buying back shares in 2023, we've reduced our share count by 5%.
Speaker Change: Entering 2025, we have five $8 billion remaining on our existing buyback authorization for opportunistic share repurchases.
Speaker Change: In 2025, we will continue to work towards our balance sheet optimization targets of $5 billion to $6 billion in cash and $5 billion to $6 billion in debt, which we outlined last quarter.
Speaker Change: At the end of 'twenty 'twenty, four we had $7.1 billion in cash on the balance sheet, which included approximately $700 million of.
Speaker Change: Estimated tax payments postponed to 2025 under IRS storm related tax relief.
Speaker Change: We also have the flexibility to remain opportunistic on issuing additional debt and we'll continue to monitor interest rates and the broader financial markets. As we approach. Our next maturity in April of this year and in January of 'twenty 'twenty six.
Speaker Change: <unk> balance sheet remains among the strongest in the sector and is a competitive advantage in a cyclical industry.
Speaker Change: It provides tremendous flexibility to support cash returns to shareholders as well as maintain our ability to invest in low cost property bolt ons and other counter cyclical opportunities.
Speaker Change: For 2025, we have outlined a disciplined capital plan that keeps capex flat year over year at $6 $2 billion the.
Speaker Change: The cash flow breakeven price to fund our capital budget and the regular dividend is in the low fifties.
Speaker Change: At $70 oil and $4.25 natural gas, we expect to earn a return on capital employed of 20% or greater now.
Jeff Leitzel: Now here is Jeff to review 2024 operating results and detailed the 2025 plan.
Thanks Anne.
Jeff Leitzel: Consistent operational execution across our multi basin portfolio during the fourth quarter capped off yet another outstanding year fourth quarter oil and gas production volumes be targets as did cash operating costs and DD&A.
Jeff Leitzel: I'd like to thank our employees for their safe and efficient operational execution, delivering not only a strong quarter, but another year of exceptional performance for the full year 'twenty 'twenty four we improved safety, reducing our workforce total recordable incident rate by 10%, we delivered more oil and total production for lower cash.
Jeff Leitzel: Cash operating cost than we initially forecasted while capital spending remained right on target.
Jeff Leitzel: We improved productivity and base production performance through innovations in completion design and artificial lift automation.
Jeff Leitzel: We lowered average well costs by 6% primarily through extended laterals in Eog's in house drilling motor program or.
Jeff Leitzel: Our marketing team continues to deliver top tier price realizations, which has consistently outpaced our peers performance. While also capturing two new natural gas agreements that expose us to premium pricing.
Jeff Leitzel: First is our 364000 M M Btu per day capacity on the Williams T lift project, along the Transco pipeline and second is our 180000 M. M. Btu per day gas sales agreement with Vitol that link sales prices to either Brent or U S. Gulf Coast gas indices, we are.
Jeff Leitzel: Also progressed to strategic infrastructure projects last year, which we expect will continue to drive peer leading realizations. The first is the 36 inch per day pipeline, which runs from our Dorado natural gas asset in Agua Dulce and provides access to Gulf coast market centers. There they came into service during the fourth.
Order last year and provides capacities for one Bcf per day expandable to 1.5 Bcf per day with booster compression.
Jeff Leitzel: The second project is our Janus natural gas processing plant in the Delaware Basin, the 300 million cubic feet per day facility will come into service in the first half of this year and connect to the Matterhorn pipeline, giving us access to multiple premium Gulf coast markets.
Jeff Leitzel: These projects and agreements demonstrate the ongoing value of our marketing strategy, which is to maintain a diverse and flexible takeaway, while maintaining control and limiting the duration of our commitments. This ultimately allows us to manage our end markets in real time, and maximize our netback through dynamic market conditions.
Jeff Leitzel: And finally, we maintained our G H G and methane emission intensity below our 'twenty 'twenty five targets.
Jeff Leitzel: Building off the momentum from our 2020 for performance, we're excited about our 2025 plan.
Jeff Leitzel: We forecast of $6 2 billion dollar capital program to deliver 3% oil volume growth and 6% total production growth our growth in 2025 is more heavily oil weighted due to the well mix in the Delaware Basin.
Jeff Leitzel: Overall, the cadence of our capital spend will be slightly more than 50% in the first half of the year, peaking in the second quarter and tapering throughout the year.
Jeff Leitzel: When looking at well costs in 2025, we expect oilfield service pricing to be relatively flat year over year. So cost reductions will come from continuing to advance the sustainable efficiency gains captured across our entire operations portfolio last year as illustrated on slide eight of our investor presentation.
Jeff Leitzel: Two of the primary drivers, we expect to continue momentum with our longer laterals in our foundational plays and efficiency gained from consistent operations and our emerging plays.
Jeff Leitzel: As a result, we are projecting a year over year percentage reduction in well cost in the low single digits.
Jeff Leitzel: As always EOG remains focused on progressing each one of our plays at the optimal pace to allow us to capture and implement valuable learnings, while realizing continuous improvement.
Jeff Leitzel: In the Delaware Basin, we are seeing improved year over year capital efficiency, the combination of longer laterals and our in house drilling motor program helped increase drilled feet per day by 10% and completed feet per day by 20% last year. Our 2025 plan includes another increase in average lateral length of at least 20.
Jeff Leitzel: Per cent, which will support continued efficiencies.
Jeff Leitzel: In our emerging plays the Utica in Ohio, and Dorado in South, Texas, we were realizing excellent operational efficiency gains and are excited to increase activity levels by 20% across these plays.
Jeff Leitzel: In the Utica last year, we increased our drilled feet per day by 50% and our completed lateral feet per day by five we anticipate efficiency gains and 2025 to be driven by higher activity levels and expect to average two full time rigs and one fulltime Frac fleet in 2025.
Jeff Leitzel: And in Dorado, we're also benefiting from efficiencies gained by maintaining a full rig program, increasing both drilled feet per day and completed lateral feet per day by 15% each in 'twenty 'twenty four.
Jeff Leitzel: We plan to maintain one full time drilling rig and gerardo, allowing us to build on last year's momentum to grow this low cost gas asset into the emerging north American demand markets.
Jeff Leitzel: This year, we will continue supplying the Texas Gulf Coast LNG market through our gas sales agreements with Cheniere, we have realized significant uplift in our natural gas revenues in the first five years of our agreement and are excited Cheniere has progressed at their corpus Christi stage three project.
Jeff Leitzel: Our forward guidance now reflects our Henry hub linked 300000 M. M. Btu per day sales agreement tied to the completion of the projects train one, which we expect to start up in 2025.
Jeff Leitzel: Furthermore, our strategic partnerships and pricing diversification continues to minimize our exposure to what ha, which is expect we expect to be limited to 5% to 7% of our total natural gas sales this year.
Jeff Leitzel: On the International front, our 2025 plan includes a modest increase in capital expenditures to advance several discoveries in Trinidad and support our new partnership in Bahrain and.
Jeff Leitzel: In Trinidad we are planning for net wells from our newly constructed Matin Mento platform and we will commence construction on the coconut platform to support the JV and farm out agreement for the coconut field signed last year.
Jeff Leitzel: We are excited about executing our 2025 plan EOG remains focused on running the business for the long term generating high returns through disciplined growth operational execution and investing in projects that lay the foundation for future returns and lowering the future cost basis of the company now here's Ezra to wrap up.
Ezra: Thanks, Jeff.
Speaker Change: 24 yielded outstanding results, we continue to generate significant free cash flow and deliver high returns on and of capital to shareholders.
Speaker Change: Capital discipline operational excellence commitment to sustainability and ultimately our culture are at the core of our success as a company you see the results in our consistent performance year after year.
Speaker Change: And EOG is continuing to deliver in 2025.
Speaker Change: Our disciplined approach to investment across our foundational and emerging portfolio of assets international expansion strategic infrastructure and unique marketing agreements continue to grow the free cash flow potential of the company both on the short and long term.
Speaker Change: Supported by a pristine balance sheet and a deep inventory of high return projects EOG continues to create shareholder value by focusing on being a high return low cost producer committed to strong environmental performance and playing a significant role in the long term future of energy.
Speaker Change: Thanks for listening now we'll go to Q&A.
Thank you the question and answer session will be conducted electronically. If you would like to ask a question. Please do so by pressing the star key followed by the digit one on your Touchtone telephone.
Speaker Change: If you're using a speaker phone. Please make sure your mute function is turned off for a while your signal to reach our equipment.
Speaker Change: Questions are limited to one question and one follow up question.
Speaker Change: We will take as many questions as time permits and once again, please press star and one on your Touchtone telephone to ask a question do you find that your question has been answered you may remove yourself by pressing the star key followed by the digit too.
Speaker Change: Well pause for just a moment to give everyone an opportunity to signal for questions.
Speaker Change: Yeah.
Speaker Change: Hum.
Speaker Change: And the first question will come from Neil Mehta with Goldman Sachs. Please go ahead.
Neil Mehta: Hey, good morning team thanks for the rundown here.
Speaker Change: Two two questions Firstly, just the free cash flow.
Neil Mehta: Guide of $4 $7 billion at 70.
Neil Mehta: And for 25, Henry hub was little softer than I think where we sit in some consensus had and I think some of that just might be timing because theres. Some pre productive capital in the plan, but maybe you could talk about that as something investments that youre, making in the emerging plays and infrastructure might show up a little bit more in the 26 free cash flow versus 'twenty.
Neil Mehta: Five.
Neil Mehta: That's been a focus of the conversations this morning.
Neil Mehta: Yes, Neal this is Ezra <unk>. Good morning, Yeah, we kind of start with the 25 plan you know, it's it's a it starts with capital discipline for US you know that as I said in the opening remarks, that's a core pillar of the value proposition that we have and it's a key consideration in establishing the plan for for each year.
Neil Mehta: So as you talked about it kind of portfolio specific with some of the moving parts here.
Neil Mehta: The plan in general is pretty consistent with the commentary we provided last quarter you know were operating.
Neil Mehta: At an optimal level and both are found foundational plays and we've got opportunities to improve our emerging plays with higher activities. So when we look at the Delaware Basin. You know, we've got flat activity. There, we're delivering a more capital efficient program. This year.
Neil Mehta: In the Eagle Ford, we've got just a little bit of moderation in activity, coupled with a little bit longer laterals are in the Eagle Ford we're seeing.
Speaker Change: You know I'd say strong and consistent capital efficiency year over year as Jeff mentioned, there is more capital being allocated to our emerging assets. So 20% more completions in the Utica are 20% more completions and Gerardo <unk>.
Speaker Change: In the Utica, we look to end the year with two rigs and one fulltime Frac fleet and as we've talked about in those emerging plays you know that's kind of that's kind of the activity level, we tried to get each of our assets to so we can really start to capitalize on the economies of scale.
And then the last moving part there of course is the we've got a little more remaining investment in the strategic infrastructure as you mentioned and then some additional investment in both the Trinidad and Bahrain as we talked about on the opening remarks, there and so it's a bit of a step up in international spend when all that kind of adds in.
Speaker Change: Essentially our capital and volume growth is similar to 2024 and as you pointed out are the free cash flow was a little bit less than the two drivers there really is a increased.
Speaker Change: Cash taxes due to some expiring <unk> that we had in 2024 that we won't have in 2025.
Speaker Change: That's the biggest piece of it and then we also have a little bit of an increase in operating expense that we're forecasting some of thats due to higher fuel and power in the field are affecting <unk> and then we also have.
Speaker Change: Some initial transportation contracts that are increasing G. P T a little bit this year as you know when you step into new transportation contracts, usually have higher cost upfront and then those kind of come down over time as you as you deliver the volumes.
Speaker Change: Essentially you know stepping back as we think about the twenty-five plan you know we're extremely excited about the year ahead from an operating perspective, we're continuing to drive strong results in those foundational place.
Speaker Change: And making the right investments to continue to improve the business going forward supporting short and long term free cash flow potential.
Speaker Change: Yeah, that's really helpful. As RASM does items that could have driven that and then.
Speaker Change: The follow up is just on international it sounds like there's a little bit more international spend in the portfolio are the capital program. This year. So can you unpack that a little bit Trinidad Bahrain in particular, and what's got you excited.
Jeff Leitzel: Hey, Neil this is Jeff Yeah, I'll, just quickly touch on it and hand, it over to Keith for a little bit of details, but yeah, you're exactly right, we've got about $100 million and their increase in the international capital.
Jeff Leitzel: That really just reflects our continued investment as you talked about both Trinidad, which we've got our mento a program that's going to be performed this year and also we're gonna be constructing our coconut platform. There and then also the new entry in Bahrain, which what I'll say is you know the goal is to start drilling on that sometime in the second half of the year. The one note on both a.
Jeff Leitzel: These though is both programs, we won't really see any volumes necessarily come online. This year there'll be pushed probably more into 2026, so I'll hand, it over to Keith for a little more detail.
Jeff Leitzel: Yeah.
Jeff Leitzel: Yeah. Good morning. This is Keith Yeah in Trinidad we are we are really excited about the program. There this year, but as we mentioned we have just set the minto platforms. So we're looking at four net wells in 2025.
Jeff Leitzel: This is a discovery that was made a few years ago, where we are the operating partner with BP and this is in the development phase of that the wells come on later in the year in 2025. So that's why you're not seeing a volume impact on the on the roll up also have our coconut project that we're really excited about.
Jeff Leitzel: We've had a consistent exploration effort in Trinidad since our entry into the country and coconut is the newest prospect and that long and successful history. So that was also an exploration well drilled a few years back and where commissioning the platform to access an estimated 500 plus bcf of resource potential associated.
Jeff Leitzel: With that that is also a joint venture project with D. P. So we really value our ongoing relationship with them, where our values also value being a preferred partner.
Jeff Leitzel: In the shallow water in Trinidad are due to our low cost structure. So we're looking forward to the drilling program that will follow the successful setting of that platform.
Jeff Leitzel: We also this year were awarded two new blocks are in Trinidad So I'm really proud of the team how they continue to unlock new opportunities we've been in Trinidad for 30 years, and we haven't really long a future there.
Speaker Change: And the next question will come from Erin Jairam with J P. Morgan Securities. Please go ahead.
Jeff Leitzel: Okay.
Erin Jairam: Yes. Good morning, just maybe as a follow up to the updated free cash flow outlook.
Erin Jairam: Wonder if you could spend a little bit time talking about your natural gas differential guidance, which is a bit wider than we expected and also wider on a year over year basis.
Erin Jairam: We thought that may narrow just given the higher amount of coverage you have at Henry hub as well as the startup of Corpus Christi I was wondering if you could help us unpack that.
Erin Jairam: Hey, good morning, It's Lance Yeah, let me unpack that for you what do you think about our guidance there and really when you look back on 24, I mean, you can see the peer leading realizations and we really expect that to kind of carry forward moving into 'twenty, five and so unpack them a little bit of a guidance, let's talk about that.
Erin Jairam: So as you think about like the basis, along the Gulf coast and kind of like depending on when you were looking at those estimates, but primarily when you look at Houston ship channel along the Gulf Coast, We've really seen that weekend here getting into their first quarter like we've seen that be about 30 since back and that's kind of moved to about 55 cents back and then Meanwhile, you've seen in IMAX obvious.
Erin Jairam: It's moved up or from the fourth quarter of 'twenty four into the first quarter or 25, I mean, we've seen that move up almost a dollar right almost like 86 cents. So so as you look at that and then think about you're right. We have these new strategic agreements that are going to be starting up this year, but that kind of has to feather in right that's going to ramp up kind of as that comes into the year.
Erin Jairam: So it really is we will see an inflection point this year, we really feel with our realizations, but you just kind of have to take that into consideration with the startup of those agreements as well. So I think if you look at the supplemental slide eight Arun I think that really does a very nice job of illustrating.
Erin Jairam: Especially when you look from 24, and a 25 I mean really how we're directing more of our molecules right away from whether it's the basis Ddos and get into places like that's more linkage to Henry hub and also into the southeast markets.
Lance: That's helpful Lance.
Lance: Maybe my follow up is just on Bahrain. It sounds like you know there has been some well control there.
Lance: Is there could you talk about what type of capital.
Lance: <unk> like this could look like and and just maybe the timeline to AR to cash flows.
Lance: If things kind of play out based on your expectations.
Lance: Yes, Arun. This is Ezra you know right off the bat at it's probably a little bit early to start talking about cash flows and things like that we we haven't disclosed the capital for our program. This year you know well, we're very excited about the JV partnership with <unk> Energy's you know at this point we've entered into a participation agreement we are.
Lance: Our waiting a couple of additional government approvals are we do have some capital in the plan that includes some activity. This year in the partnership you know what I can say is EOG is the operator, we will be evaluating you know of tight gas and gas exploration prospect.
Lance: The agreement does anticipate selling the production into the local market there, which is great. You know in this area are the formation has been tested seem positive production results already with horizontal development and as you guys know this as you know our brains not a not a significantly large island or anything.
Lance: And so we do have existing infrastructure and midstream in the area.
Lance: Which would allow us to if successful uncompetitive with our portfolio would allow us to go to sales relatively quickly we're optimistic really the applying our expertise in horizontal drilling and completion technologies should enhance the returns and the results and drive economics to be competitive with the domestic pork.
Lance: Folio.
Speaker Change: And the next question will come from Josh Silverstein with UBS. Please go ahead.
Josh Silverstein: Hey, Thanks. Good morning, guys. So you ended 2024 with 7 billion in cash following the debt offering at Sao.
Josh Silverstein: Like you have the $700 million tax payment for this year, but how should we think about the pace of buybacks. Given you talked about wanting to stay you know in a cash balance of 6 billion or less.
Speaker Change: Thanks, David.
Josh Silverstein: Yes.
Yeah.
Josh Silverstein: Our capital structure.
Josh Silverstein: Well last year.
Josh Silverstein: Yes.
Josh Silverstein: So basically.
Josh Silverstein: Okay.
Josh Silverstein: Hum.
Josh Silverstein: $45.
Josh Silverstein: So let me take that metric.
Josh Silverstein: Approximately.
Josh Silverstein: Yeah.
Josh Silverstein: We followed through on that.
Josh Silverstein: And last year.
Josh Silverstein: You've got $1 billion.
Josh Silverstein: Yeah.
Josh Silverstein: We're going to work towards that.
Josh Silverstein: Yeah.
Josh Silverstein: Yeah.
Josh Silverstein: Yeah.
Josh Silverstein: Forward over the next 12.
Josh Silverstein: Alright.
Josh Silverstein: I don't believe you.
Josh Silverstein: Right.
Josh Silverstein: Oh.
Josh Silverstein: Oh.
Josh Silverstein: Oh.
Josh Silverstein: Alright.
Josh Silverstein: I'm sorry.
Josh Silverstein: Absolutely.
Josh Silverstein: Alright.
Josh Silverstein: Okay.
Josh Silverstein: Okay.
Josh Silverstein: Hi.
Josh Silverstein: Okay.
Josh Silverstein: Okay.
Josh Silverstein: Yeah.
Josh Silverstein: Okay.
Josh Silverstein: Uh huh.
Josh Silverstein: It's not working.
Josh Silverstein: Yes, sorry, we couldn't hear that well.
Josh Silverstein: Okay do you want me started kind of start over.
Josh Silverstein: That'd be great Yeah, sorry, yeah, sorry about that my apologies and on the debt side. When we're looking at the debt side. If you recall back in the end of 2024, we outlined our capital plans our capital structure for 'twenty I'm going forward and what are committed and we wanted to make our capital structure more efficient and as we outlined last quarter and where your focus.
Josh Silverstein: Our achieving a debt level of less than one times total debt to EBITDA at $45. Debbie Ti. If you look at that metric that would be approximately $5 billion to $6 billion. We followed through on that commitment I'm back in November by raising $1 billion in 30 year paper that is $5 65 per cent.
Josh Silverstein: And we're going to continue to work towards that $5 billion to $6 billion debt level, and we have flexibility on the timing and when we achieve that that amount on and well do it off of course of the next 12 to 18 months I mean, if you look at our cash level and we believe the appropriate level of cash continues to be in that $5 billion to $6 billion and we have run at that level for the last couple of.
Josh Silverstein: Yes, and we think that's the right level to run our business Backstopped, our regular dividend as well as supporting additional cash return and countercyclical investment you are correct that $7 billion at year end included that $700 million that we paid out in February of 2025.
Josh Silverstein: Turning to the pace of our buybacks, it's really about our commitment.
Josh Silverstein: Commitment to return free cash flow to shareholders and we're staying at that targeted a minimum of 70% and we have the potential to and are well positioned to return more a higher percentage of free cash flow them back to the shareholders in 2025 and going forward and we've exceeded that minimum as you saw in 2024.
Josh Silverstein: Uncomfortable with that being our long term target so as far as share repurchases and we will continue to be opportunistic we're not putting in any type of programmatic plan well just continue to watch on where our share prices go and well be opportunistic in our buyback program again, we're just committed to returning a significant portion of our free cash flow to our investors.
Josh Silverstein: And then cash return is anchored by the dividend and then in turn well, let's team I'm share repurchases and other returns of value back to shareholders.
Speaker Change: Thanks, Dan.
Josh Silverstein: Then second.
Josh Silverstein: Dorado, you've held back some activity over the past two years, we're now in a higher price environment. Your pipeline started up in the.
New LNG facilities, starting up around the corner.
Speaker Change: Are you guys just waiting on kind of confirmation of the $4 plus gas price environment to accelerate more activity or just take anymore and a modest pace of growth there.
Speaker Change: Yeah, Josh This is Jeff you know as we do in with any of other plays you know, we're just evaluating the activity levels. There really more from a long term perspective, rather than just looking at the near term commodity price volatility. So really when we look at Dorado, we feel that the 20% increase in activity. This year is a really good level and a truly reflects what.
Speaker Change: We believe is the optimum level of activity just to continue to push it forward year over year for operational improvements like we saw in 2020 for you know and we saw about 15% improvement and drilled and completed feet per day and our you know we think with this current activity level. It really positions Dorado are in a great position to <unk>.
Speaker Change: Improved year over year and continues to drive down the costs, while we're taking advantage of where the proximity is and what we really look to do is not just invest necessarily at a particular price point, but we really look to invest you know to lower our costs through the cycles.
Speaker Change: And the next question will come from Leo Mariani with Ross. Please go ahead.
[laughter].
Speaker Change: Hi, guys just wanted to follow up a little bit on the decision to dial back our Eagle Ford activity. It looks like net completions are down around 25% year over year. I know you have lateral lengths are going up so presumably total completed feet are down quite that much but just provide a little bit more color. There are you just see.
And like incremental returns not being as competitive.
Speaker Change: With your Delaware or the emerging plays where we obviously increasing activity here in 'twenty five.
Speaker Change: Yeah. Thanks, Leo This is Keith I think what we're really seeing is that we really leaned into the Eagle Ford in both 2023 and 2024.
Speaker Change: In 2023, we had stepped up activity levels in the wake of the persistent inflation in the Delaware Basin.
And in 'twenty 'twenty, four we were sharing a frac crew.
Speaker Change: Between Dorado.
Speaker Change: Eagle Ford. So consequently, there were more completions in the Eagle Ford when we deferred completion activity in Dorado due to weaker gas prices.
Speaker Change: And so I think what you're seeing is us getting back down to a to a kind of a background levels. There you mentioned the longer laterals. So.
Speaker Change: You know when we look at how much lateral feet. We're competing in a year are you know this year is pretty.
Speaker Change: It's pretty average compared to the last several years. So the Eagle Ford is a is a core foundational asset for us. It continues to be the despite operating in the play for only 15 for 15 years are the consistent improvements and efficiencies have allowed us to realize some of the highest returns in the play we've ever seen actually in the last several years.
Speaker Change: Ours and it supports our line of sight to maintain production for a decade or more really.
Speaker Change: Okay.
Speaker Change: And why don't you just jump back over to the exploration side I know you guys have been looking at a number of domestic.
Speaker Change: Oil exploration plays in the last handful of years.
Speaker Change: Just wanted to get a sense of what the activity levels. There are are you still pursuing those type of you know lower cost exploration plays domestically for oil here in 2025, obviously, you've got the tobacco JV, which is international gas. So just trying to kind of get a sense there.
Speaker Change: Are these plays active in and what should we expect in terms of activity in 'twenty five.
Speaker Change: Yes, Leo this is Ezra that's a great question you know with tobacco announcement, you can see that we've obviously been active not only on the domestic exploration front, but also international like you said you know <unk> is a is an international gas opportunity and so I think that highlights I'm really.
Speaker Change: Well, where we're focused at with with our exploration our approach and that is really you know not necessarily to focus on an oil versus gas, but really what we focus on for either domestic or international is are the returns of the play and what is how are additive to our existing <unk>.
Speaker Change: Mentor's will the project be and so as you highlighted we've got an active domestic program, we drilled a few wells last year and we plan to drill a few more this year, but further than that Leo you know, we typically don't comment or.
Speaker Change: Or give additional details on our exploration programs are more than that we do remain optimistic that there is still resources in the in the.
Speaker Change: In the U S that will continue to be additive to our overall inventory that we have.
Speaker Change: And the next question will come from Derrick Whitfield with excess capital. Please go ahead.
Derrick Whitfield: Good morning, all and thanks for taking my questions.
Speaker Change: From the outside it appears that you guys have experienced tremendous success with all three emerging trends.
Speaker Change: My first question I'd like to focus on the Utica and ask how close is it to competing heads up with the Eagle Ford.
Speaker Change: Okay.
Speaker Change: Yeah Derrick this is Ezra.
Speaker Change: You know it's interesting you know the Eagle Ford we have is a very mature asset and what I'd say is as Keith alluded to when we invest at the Eagle Ford at the right pace, we still generate significant returns there and one of the reasons is because we got all the infrastructure in place we've got our marketing agreements dialed in.
Speaker Change: We've really captured the economies of scale. So that's really one of the things that are right off the bat is still lacking with the Utica well.
Speaker Change: We've really got a you know we've been able to make good strides on the operational efficiency gains as Jeff mentioned at the in the opening notes, but really to get that thing to compete with either of our foundational assets you really need to get it to a place where you can drive down the cost sustainable cost through the through the capturing the economies of scale of and when I say infrastructure.
Speaker Change: Sure you know, it's not just midstream or takeaway, it's things like in basin sand locations getting our water infrastructure squared away.
Speaker Change: And then just having consistent frac and drilling operations to the point, where we provide a safe.
Speaker Change: <unk> consistent operating environment, where the guys in the field can really drive down costs I would say that we've been very happy with the early time results were exceptionally pleased with the results that we've had over the first two years in this play.
Speaker Change: We talked about we're carrying a lot of momentum into 2025, I think we highlighted in November that over the next couple of years, while we focus on the volatile oil window. We should we're looking at a six to $8 per Boe, finding and development cost that contemplates less than a $650 per foot well cost.
Speaker Change: Which already on those types of metrics you know brings it very well in line with with kind of where the Eagle Ford is on a heads up comparison, when you think about how far we'd made it with the Eagle Ford after a year or two.
Speaker Change: And if you think about it that way the Utica as you know significantly farther down the path of having lower well costs and quite frankly, a better understanding of the subsurface reservoir quality.
Speaker Change: That's great and for my second question with the efficiency and productivity gains you've noted in the Niobrara, where do you think you can drive F&B costs with the benefit of both working it seems like we're getting closer and closer to a breakthrough in the P. R. B.
Speaker Change: Yeah. This is Keith in the AR in the in the Powder River, Yeah, exactly we've talked about in the past we when we were developing the mowery, we'd gathered data on the Niobrara, which is a which is shallower and that we were shifting activity to be more focused on the niobrara. So if you look at the powder.
Speaker Change: Activity as a whole.
Speaker Change: In 2025 plan, it's roughly flat to last year, but it's much more an io focus. So if you were just to look at NATO, our well counts a year over year significant up tick uptick this year.
Speaker Change: And the play overall and 2024 being able to have all that data gathered and then put the focus on it we were able to increase the well productivity, 20% and the Niobrara year over year, that's 'twenty 'twenty four to 2020 three.
So reduce the days to drill.
Speaker Change: Net down to down 10% year over year. So we're very happy with the strides in the powder.
Speaker Change: And you know on the on the finding costs that I kind of say this we talk about how our.
Speaker Change: Our company overall is a multi basin portfolio, we kind of have you know.
Speaker Change: Little multi basin portfolio and the powder itself you have the Mallory more of a combo play with good finding costs. The numbers and then the Niobrara need a little more oil, which is a little bit higher return and together they do kind of a mix to make a nice kind of holistic asset there.
Speaker Change: And the next question will come from Nitzan Kumar with Mizuho Securities. Please go ahead.
Speaker Change:
Nitzan Kumar: Thanks for taking my question guys.
Speaker Change: Focus on the Delaware.
Speaker Change: You're raising lateral lengths there quite significantly.
Speaker Change: But last year, we had talked about sort of stepping away from the core oil and into some other parts of the basin.
Speaker Change: Would you characterize the productivity of the Delaware program this year versus last year.
Okay.
Speaker Change: Yes. This is Jeff and you know the productivity trends in the Delaware Theyre going to vary you know in any given year just based on several factors, but we're fully confident in the development strategies, we have out there and just the durability of the returns and the full cycle economics that we're seeing so with any of our plays you know obviously, including the.
Speaker Change: A delaware the first thing we leverage is rate of return at a flat bottom cycle pricing and that's a pretty good starting point to underpin your evaluation, but theres a lot of other key metrics that we like to evaluate and specifically, we really want to maximize the net present value not just up the well, but really the sections out there we want to make sure that we're expanding the margins.
Speaker Change: And we really pay attention to what the payback period is just to make sure that we're delivering the greatest value and really capturing as much resources possible. So as you just hit on in the Delaware You know a perfect example, and we've kind of talked about is you know this year alone we're seeing some variation in the well mix there where the <unk>.
Speaker Change: Activities slightly more oil weighted in the first quarter and that really just has to do with that well mix, where we move around the field back and forth from area to area developing different flow benches, and that's just part of our normal development. So and you'll continue to see this kind of variation in productivity and well mix you know throughout the development of the play and then the other thing that I just.
Speaker Change: Touch on there in the Delaware is over the last few years, we've made significant improvements in our shallow targets, you know really by lowering cost and improving the productivity by really just pushing forward. Our current best practices. So when you break it down by you know targeting play there. If you look at the Leonard the bone Springs, Wolfcamp targets, they're all delivering comparable return.
Speaker Change: That bottom cycle pricing. So when you roll it all up today, you know I think we're better positioned than ever to really optimally develop a given section from both our subsurface targeting perspective because of our geologic knowledge and then also the above ground infrastructure perspective, and that really is what allows us to balance all of these things return N P V pay out margin.
Speaker Change: <unk> resource capture and productivity to make sure we ultimately maximize value.
Speaker Change: Great. Thanks, Thanks for the detail there Jeff.
Speaker Change: I'm going to try to take one more shot at the Bahrain opportunity I know details are limited.
Speaker Change: And that accounts for about 10% of your corporate cash production.
Speaker Change: Could bahrain and be the same scale or bigger older years, and then for those of US who don't know what borrowing local gas pricing looks like.
Speaker Change: Are the returns as competitive as your domestic exploration.
Speaker Change: Yes, Nick this is Ezra.
Speaker Change: We are revisiting Bahrain like I said, we're excited to to talk about it.
Speaker Change: You know I think the first tell us that we wanted to take an opportunity international just to say that we have at Avon International opportunity for us to take this step we need a couple of things in the first is that we have you know pretty strong conviction from an exploration standpoint, I mean, we still need to you know.
Speaker Change: Test these wells a little bit more but we've got pretty strong conviction that we will be able to turn this into something that's meaningful for our shareholders. So that means it's got the size and scale and the potential to deliver returns that are additive to our program something that will actually command capital that will want to invest in the second part of that obviously is to take a big.
Speaker Change: Like this we want to make sure that we're a way of stakeholder alignment and we found a good partner and that's why I keep saying that you know we couldn't be more thrilled with the partnership that we found with <unk> energies.
Speaker Change: As far as gas price our in country, we haven't talked about that but yes.
Speaker Change: You should think that when we look at the potential sales price in the market that are if we would take that in consideration of all the well productivity and the cost structure that we anticipate seeing there and roll that all up into you know something that can be additive and meaningful for the company.
Speaker Change: The next question will come from John Freeman with Raymond James. Please go ahead.
Speaker Change: Good morning, I, just wanted to circle back on the year on a unit.
Speaker Change: A lot last year, you all tested well spacing from kind of a 700.
Speaker Change: And I shall increase activity pretty pretty meaningfully in the Utica are you sort of or I guess dialed in on a specific sort of spacing or is testing still a big part of what Youre doing are we sure to kind of understand that better.
Keith Yeah: Yeah, John this is Keith.
Keith Yeah: As far as just a question development versus testing, where we're doing both.
Brad: Brad ourselves and not being in a manufacturing mode ever in any of our plays and so we don't really employ a set spacing or completion design throughout an entire field. So it's a little difficult to draw a line between development and testing. So we're constantly incorporating new data and learnings to improve every well in every package across all.
All of the place foundational and emerging as far as spacing goes we've talked about in the past that it's you know we feel it's going to be 600 to 1000, which is pretty standard for north American unconventional oil play, but what we've also said it depends on the area and so in our last year at least we showed tests between 800.
Brad: And a thousand we think the geology plays a significant.
Brad: A portion a significant factor in what your spacing should be so like an example would be in the south where we have thinner pay but we also have a better frac barriers, we've talked about in the past that could also mean that the frac reaches out further so might expect wider spacing in the south to work out better those sorts of things.
Brad: The things that our team takes into account every time, they they drilled the package and incorporated into the next one going on.
Brad: Thanks for that and then.
Brad: These emerging plays you know take on more activity more capital as the sum of.
Brad: These international opportunities.
Brad: Talking about today.
Brad: Do you all start to take maybe a harder look at divestitures, just as a way to unlock value given that they're pretty deep global portfolio, you've got with maybe some areas, having a tougher time kind of competing for capital that may be more valuable to somebody else.
Ezra: Yes, John This is Ezra yeah, we continue to have a we we we continually review our inventory.
Ezra: And continue to look for opportunities to bring value forward.
Ezra: At any opportunity that we can for the most part you know we've done a good job over the last you know I would say going back almost the last decade, and we've been you know not surprisingly we've been fairly active in the divestiture market and so we've done a good job kind of high grading our portfolio at the right times.
Neal Dingmann: And the next question will come from Neal Dingmann with true Securities. Please go ahead.
Neal Dingmann: Good morning, and thanks for the time My first question is maybe on IPP or their power Gen operations I'm. Just wondering the number of your peers have talked about how their surface water and natural gas resources would make for an ideal makes them an ideal partner for transactions and I'm wondering you definitely seem to have those same high asset qualities.
Neal Dingmann: I'm wondering with that said are you all actively speaking into some of these hyperscale or and if so.
Neal Dingmann: Do you think your opportunity is to do something like that would be in the Appalachian Dell Eagle Ford because you certainly have a lot of interesting areas, where you could do something like that.
Neal Dingmann: Yeah. It's a good question Neal this is Ezra <unk> and you're right you know with our investment in and utilization of technology.
Neal Dingmann: We have spent a lot of time looking at our data Center development, you know may progress and what role.
Neal Dingmann: Industry and EOG, specifically would would play in that.
Neal Dingmann: There's already a couple of different ways that we benefit today and you know a couple of different ways. We can benefit in the future currently if you.
Neal Dingmann: Look at where the data centers are found there typically in areas with dense and diverse fiber lines are you know, that's obviously a bit more important than just surface and water. It's the diversity of the fiber lines and if it's in the ground and as a result, Oh oftentimes those data centers end up being a little bit closer to urban areas.
Neal Dingmann: The first thing is it's very nice we've done a great job with our diverse marketing strategy and that gives us exposure whenever you see a regional pricing uplift that's associated with just the increased electrical demand in those areas.
Neal Dingmann: Good example is.
Neal Dingmann: The the capacity along the Transco pipeline to deliver gas into the southeast market that we captured last year.
Neal Dingmann: But more exciting maybe as the second way, we think that you know EOG can benefit as if data center development outpaces infrastructure development and so what I mean, there is you know the current model requires transmitting energy either in the form of.
Neal Dingmann: Electrical grid or natural gas pipelines over long distances to deliver to these data centers are another model then would be and you're starting to see a develop is constructing data centers closer to the power generation closer to natural gas fields are.
Neal Dingmann: But also more important than surface of waters, where theres enough fiber to make the investment worthwhile.
Speaker Change: When I think about that Ah I think know Neil you hit the nail on the head there, we see the Gulf Coast, and South, Texas as having the potential to play a larger role in data center, Buildout, and obviously geraldo would benefit greatly from that regional demand.
Speaker Change: Yeah, you definitely have some interesting areas and then maybe just a second if I could ask maybe on the Utica little bit differently. I'm curious I don't know if youre able to discuss what part of you to hit your target.
Speaker Change: Acres are or maybe just look at it another way I'm just curious how you all are now thinking about.
Speaker Change: Maybe you know you've got a huge footprint almost 500000 acres now I'm wondering how you think about the western side of the black oil window, what I don't know if maybe I could start county.
Speaker Change: Versus the eastern side.
Speaker Change: Well over into like Trimble County.
Ezra: Yeah Neal this is Ezra again.
Ezra: Again, where we did most of our leasing we're still focused in on the AR on the volatile oil window.
Ezra: Leasing and picking up leases out in front of our drilling opportunities at this point as far as if you think about kind of the wild west land grab and things like that that's that's the majority of that is kind of ended in that play and so we're doing a lot of our strategically you see now kind of coring up our areas and since we'll be focusing for the next few years really and drilling in the volatile.
Ezra: Oil window, that's where the focus of the leasing I think you can expect that dominantly going forward as far as stepping out and the expansion. We're still a little ways. You know, we're still talking about it when we need to get our seismic shot up there first but ultimately like any basin. If you go back whether it's gosh you know even go back to you know Barnett our early days of the Hague.
Ezra: Ville Eagle Ford Permian, Bakken and things like that you know you really start in the areas, where you've got the most data and that certainly is the volatile oil window for us.
Ezra: We will develop our wells there as Keith alluded to earlier, we're making good progress on identifying things like the correct spacing across you know, there's almost 500000 acres as you said and once you start to really collect a lot of data and understand more about the reservoir. That's when you can start to step out into these other areas. Once you have a better understanding of kind of what.
Ezra: The value drivers are of the of the unconventional play.
Doug Leggate: And the next question will come from Doug Leggate with Wolfe Research. Please go ahead.
Speaker Change: Good morning. This is John Abbott on for Doug Leggate and thank you very much for taking our questions.
Speaker Change: It is wrong at your scale, it's getting harder to move the needle.
Speaker Change: The resource you'd have about 27 years of inventory.
Speaker Change: So it seems to us to dividend becomes a more important part of market recognition of value.
Speaker Change: So our question is how do you think about the evolution of the dividend the dividend growing rate and the dividend breakeven.
Speaker Change: Okay.
Speaker Change: Yes, John Thanks, Thanks for joining the call. It's good to hear from you.
Speaker Change: No.
Speaker Change: We're in complete agreement, we think the best marker for you know a blue chip stock or a company of our scale and size.
Speaker Change: It should be reflected in a sustainable and growing regular dividend and that's really what we focus on and we feel is the foundation of our cash return strategy.
Speaker Change: You know, we've we raised our regular dividend, 7% last year.
Speaker Change: And we've actually raised our regular dividend two times. The peer average is a compound annual growth rate. Since 2019, we've got 27 years of sustainable growing regular dividend.
Speaker Change: And so we we really come at that a lot. The way we think about how do we grow that the most important word I said is sustainable so we grow it in concert with expanding margins that means both growing topline revenue, but also you know topline cash flow from operations, but also lowering the cost basis of the company. So I'm, making sure that the company is continuing to improve.
Speaker Change: And then we also marry that up with a strong balance sheet, just as a backstop on that regular dividend.
Speaker Change: We agree with you John I think you know what we like to see is the the dividend increasing in the yield decreasing.
Speaker Change: Appreciate it and then for the second question is on cash taxes.
Speaker Change: At least for US it was a little difficulty hearing in the beginning when and with speaking but.
Speaker Change: Are you.
Speaker Change: Is the A&P could you talk about the AMC, we thought our impression that you were already a full cash taxpayer is that correct.
Speaker Change: Could you discuss how you could you discuss a little bit more detail your cash tax outlook.
Speaker Change: Absolutely. This is Ann thanks for the question, John and I think the way that we look at the way we're modeling it out our current tax provision in 2024 included 212 million and alternative minimum tax credits and those were fully exhausted when we exited 2024, so youre not going to see any impact of that in 2020.
Speaker Change: Five so as a result, when you're looking at current tax increase.
Speaker Change: See about 15% increase in current taxes as we move into 2025 and as we look forward. Our current guidance for 2025 does not contemplate any material or unusual items. So all things being equal 2025 is a good proxy as we move forward.
Speaker Change: This concludes our question and answer session I would like to turn the conference back over to Mr. Jacobs for any closing remarks.
Speaker Change: Yeah. Thank you I just wanted to say we appreciate everyone's time today, we're very excited for 2025, I think our plan reflects an appropriate pace of investment to improve each of our assets year over year as well as the broader opportunities, we see to build and improve our business.
Speaker Change: Disciplined reinvestment in the higher return multi basin portfolio is how EOG continues to get better it allows us to lower our breakeven as we had lower cost reserves and ultimately allows us to often I optimize both near and long term free cash flow generation as always thank you to our shareholders for your support and special thanks to our employees for delivering another.
Speaker Change: They're exceptional quarter.
Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
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