Q2 2025 CNX Resources Corp Earnings Call
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Unknown Executive: 2025 Q&A conference. All participants will be in listen-only mode. If you need assistance, please signal a conference specialist by pressing the star key followed by.
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Speaker Change: I would now like to turn the conference over to Tyler Lewis Vice President of Investor Relations. Please go ahead.
Good day and welcome to the cnx resources. Second quarter 2025 Q&A conference call. All participants will be in listen-only mode. Should you need assistance? Please signal a conference specialist by pressing the star key followed by zero.
After today's presentation, there will be an opportunity to ask questions.
Speaker Change: Thank you and good morning to everybody welcome to <unk> second quarter Q&A Conference call.
Tyler Lewis: I would now like to turn the conference over to Tyler Lewis, Vice President of Investor Relations. Please go ahead. Thank you, and good morning, everybody.
Speaker Change: Today, we will be answering questions related to our second quarter results. This morning, we posted to our Investor Relations website, an updated slide presentation and detailed second quarter earnings release data such as quarterly E&P data financial statements and non-GAAP reconciliations, which can be found in a document titled <unk>.
Tyler Lewis: Welcome to CNX's second quarter Q&A conference call. Today, we will be answering questions related to our second quarter results. This morning, we posted to our Investor Relations website an updated slide presentation and detailed second quarter earnings release data, such as quarterly E&P data, financial statements, and non-GAAP reconciliations, which can be found in a document titled 2Q-2025, Earnings Results and Supplemental Information of CNX Resources. Also, we posted to our Investor Relations website our prepared remarks for the quarter, which we hope everyone had a chance to read before the call, as the call today will be used exclusively for Q&A.
Speaker Change: 2025 earnings results and supplemental information of <unk> resources.
Speaker Change: Also we posted to our Investor Relations website, our prepared remarks for the quarter, which we hope everyone had a chance to read before the call as the call today will be used exclusively for Q&A.
Speaker Change: With me today for Q&A are Nick <unk>, our Chief Executive Officer, Alan Shepherd, President and Chief Financial Officer, and that meet Bell, our Chief operating officer. Please.
Thank you. And good morning, everybody. Welcome to cnx second quarter Q&A conference call. Today, we will be answering questions related to our second quarter results. This morning. We posted to our investor relations website, an updated slide presentation in detailed second quarter. Earnings released data such as quarterly, ENT data financial statements and non-gaap reconciliations, which can be found in a document titled, 2q, 2025 earnings results and supplemental information of cnx resources,
Speaker Change: Please note that the company's remarks made during this call including answers to questions include forward looking statements, which are subject to various risks and uncertainties. These statements are not guarantees of future performance and our actual results may differ materially as a result of many factors a discussion of risks and uncertainties related to this factor.
Tyler Lewis: With me today for Q&A are Nick DeIulis, our Chief Executive Officer, Alan Shepard, President and Chief Financial Officer, and Navneet Behl, our Chief Operating Officer. Please note that the company's remarks made during this call, including answers to questions, include forward-looking statements which are subject to various risks and uncertainties. These statements are not guarantees of future performance, and our actual results may differ materially as a result of many factors. A discussion of risks and uncertainties related to those factors in CNX's business is contained in its filings with the Securities and Exchange Commission and in the release issued today.
Also, we posted to our investor relations website, our prepared remarks for the quarter, which we hope everyone had a chance to read before the call as the call today will be used exclusively for Q&A.
Speaker Change: With me today for Q&A or Nick dolas, our chief executive officer, Alan Shepard, president, and Chief Financial Officer and have a neat Bell. Our chief operating officer
Speaker Change: <unk> and <unk> business is contained in its filings with the Securities and Exchange Commission and in the release issued today with that thank you for joining US. This morning, and operator can you. Please open the call for Q&A at this time.
Speaker Change: Certainly we will now begin the question and answer session. As a reminder to ask a question you May Press Star then one on your telephone keypad, if youre using a speakerphone. Please pick up your handset before pressing the keys if at anytime. Your question has been addressed and you would like to withdraw. Your question. Please press Star then two at this time, we will pause <unk>.
Tyler Lewis: With that, thank you for joining us this morning, and operator, can you please open the call for Q&A at this time? Certainly.
Speaker Change: Please note, that the company's remarks made during this call, including answers, to questions, include forward-looking statements, which are subject to various risks and uncertainties. These statements are not guaranteed as a future performance and our actual results May differ materially. As a result of many factors, a discussion of risks and uncertainties related to those factors and see you. Next is business, is contained in its filings with the Securities and Exchange Commission. And in the release issue today with that, thank you for joining us this morning. In operator, can you please open the
Speaker Change: Call for Q&A at this time.
Unknown Executive: We will now begin the question and answer session. As a reminder, to ask a question, you may press star, then 1 on your telephone keypad. If you are using a speakerphone... If at any time your question has been addressed, and you would like to withdraw your question, please press star.
Speaker Change: Entirely to assemble our roster.
Zach: And your first question comes from Zach <unk> with J P. Morgan. Please go ahead.
Zach: Hey, Thanks for taking my questions I wanted to ask on the 40 <unk> tax credit could you just give us a little detail on that.
Unknown Executive: At this time, we will pause momentarily to assemble our roster.
Speaker Change: Certainly we will now begin the question and answer session as a reminder to ask a question, you may press star then 1 on your telephone keypad. If you are using a speaker-phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star. Then 2 at this time we will pause momentarily to assemble our roster.
Zach: The timing and ability to claim those credits.
Zach Parham: And your first question comes from Zach Parham with J-P-A-R-M-A-N-I-S-T-A-N-I-S-T-A-N-I-S-T-A-N-I-S-T-A-N-I-S-T-A-N-I-S-T-A-N-I-S-T-A-N-I-S-T-A-N-I-S-T Please go ahead. Hey, thanks for taking my questions. I wanted to ask on the 45Z tax credit, could you just give us a little detail on the timing and ability to claim those credits? And as the rules are laid out today, would those credits just run through 2029?
Zach: As the rules are laid out today would those credits just run through 2029.
Speaker Change: And your first question comes from Zack parum with JP Morgan. Please go ahead.
Zach: Yeah How's that.
Zach: Question so.
Zach: The way the program set up currently right.
Zach: The initial guidance as you pointed out there needs to be final rulemaking as long as everything comes in in line with initial guidance. The first year of eligibility to claim credits would be in 2025. So if you saw in our materials, we were talking about 2026.
Zack Parum: Hey, thanks for taking that question. I wanted to ask on the the 45z tax credit. Could you just give us a little detail on the timing and ability to claim those credits and as the rules are laid out today, would those credits just run through 2029?
Unknown Executive: Yeah, hi, Zach. Good question. So The way the program is set up currently, right, as the initial rule guidance, as you point out, there needs to be final rulemaking, as long as everything comes in in line with the initial guidance. The first year eligibility to claim credits would be in 2025. So you saw in our materials, we were talking about 2026 would be the first potential opportunity to get some of that $30 million a year run rate. And then, yeah, the program got extended under the OBB through 29, would be the first time that it would be up for re-extension.
Speaker Change: Yeah. Hi Zack. Um, good question. So
Zach: First central opportunity to get some of that 30 million a year run rate.
Zach: And then yes the program got extended under the Ob <unk> through 'twenty nine it would be the first time that it would be up for re extension.
Zach: Thanks, and also just wanted to ask on activity levels at the E&P business.
Zach: Any plans to grow volumes here I know at one point you had talked about having optionality to add some activity back in the second half of the year and if not can you talk about what a maintenance program might look like in 2026 would that be.
Zack Parum: the way the program set up currently right the the initial we'll go down to did you point out there? There needs to be final rulemaking as long as everything comes in in line with the initial guidance. Uh, the first year eligibility to claim credits would be in 2025. So if you saw in our materials we were talking about 2026 um would be the first potential opportunity to to get some of that 30 million a year, run rate. Um and then yeah the program got extended under the obb. The um through 29 would be the first time that it would be up for
Unknown Executive: Thanks. And also just wanted to ask on on activity levels at the E&P business. Any plans to grow volumes here? I know at one point y'all talked about having an optionality to add some, some activity back in the second half of the year. And, and if not, you know, can you talk about what a maintenance program might look like in 2026? Would that be? Flatish CapEx year over year, just trying to get a sense of what activity levels may look like.
Zach: Flattish capex year over year, just trying to get a sense of what activity levels might look like.
Zach: Yes, so maybe on the first one.
Zach: We're positioned with some Optionality you have you seen sort of the end of your storage levels stay low I mean at this point.
Zack Parum: Thanks. Um, and also just wanted to ask on on activity levels at the INTP business. Um, any plans to, to grow volumes here? I know at 1 Point y'all talked about having an optionality to add some some activity back in the second half of the year and and if not, you know, can you talk about what a maintenance program might look like in 2026. Would that be?
Zach: Clear that we're gonna creep towards kind of four tcf in storage.
Zach: And under that scenario, we're just going to maintain the initial set of activity that we plan for the beginning of the year. So no no changes expected at the current time.
Unknown Executive: Yes, maybe on the first one, you know, we were positioned with some optionality had we seen sort of the end of year storage level stay low. I mean, at this point, it's pretty clear that we're going to creep towards kind of for TCF and storage. And under that scenario, we're just going to maintain the initial set of activity that we planned for the beginning of the year.
Zack Parum: Flattish, capex year-over-year. Just trying to get a sense of of what activity levels may look like.
Zach: When you think about.
Zach: Capital efficiency level, we have a way to do that sort of tie back to what we guided to a few years back a few quarters back the two numbers that stand out or sort of a $580 million.
Unknown Executive: So no, no changes expected at the current time.
Zach: Production of 580 days of production over the $500 million Capex. So that ratio was about 85 cents.
Unknown Executive: When we think about sort of capital efficiency levels, I think the way to do that is to sort of tie back to what we got into a few years back or a few quarters back. The two numbers that stand out are sort of the 580 million of production or 580 B's of production over the 500 million dollar CapEx. So that ratio is about 85 cents. per million in terms of capital efficiency. I think moving forward, you know, if you set aside the actual production will target, which we always talk about as being a function of optimizing free cash flow per share, that's the right ratio to kind of think about the business's capital efficiency moving forward, kind of that mid 80s range, and it'll wiggle plus or minus a little bit any given quarter, just with the lumpiness with the one rig program, but that's the right way to think about it moving forward.
Zach: Per million in terms of capital efficiency I think moving forward. If you set aside the actual production will target, which we always talk about it as being a function of optimizing free cash flow per share. That's the right ratio to kind of think about the business with capital efficiency moving forward crime about mid <unk> range, and little wiggle, a plus or minus a little bit in any given quarter just with the lumpiness.
Yeah, so maybe on the first 1 um you know we were positioned with some optionality. Had we seen sort of the end of the year Storage level, stay low. I mean, at this point it's it's pretty clear that we're going to creep towards kind of for TCF and storage. Um and under that scenario, we're just going to maintain the initial set of activity that we'd planned for the beginning of the year. Um, so no. No changes expected at the current time, um, when we think about, um, sort of capital efficiency levels, I think the way to do that is to sort of tie back to what we've got it to a few years back or a few quarters back. Um the 2 numbers that stand out are sort of the the 580 million of
Zack Parum: Uh, production or 580 Visa production, over the 500 million dollar capex. So that ratio is about 85 cents. Um,
Zach: But the one rig program, but that's the right way to think about it moving forward.
Speaker Change: Thanks, Alan I appreciate the color palette yep.
Leo Mariani: And your next question comes from Leo Mariani with Roth. Please go ahead.
Leo Mariani: Yeah, good morning here.
Zack Parum: Per million in terms of capital efficiency, I think moving forward. You know, if you set aside the actual production, we'll Target which we always talk about as being a function of optimizing free cash flow per share. That's the right ratio to kind of think about the businesses Capital efficiency moving forward. Kind of that mid 80s range and it'll wiggle plus or minus a little bit any given quarter, um, just with the lumpiness. But the 1, but that's the right way to think about it. Moving forward.
Unknown Executive: Thanks, Alan. Appreciate the cover.
Leo Mariani: I wanted to see if you can get a little more color on.
Drilling and completion activity levels in the second half I know you all have said that capex was pretty front half weighted.
Zack Parum: Thanks Alan. Appreciate the cover color. Yep.
Leo Mariani: The next question comes from Leo Mariani with Roth. Please go ahead. Yeah. Good morning here. I wanted to see if you could get a little bit more color on, you know, drilling and completion activity levels in the second half. I know you all had said that CAPEX was pretty far half-weighted in 25, but just looking at your turn-in-line schedule, the vast majority of turn-in-lines, I believe they happen here in one queue. So if you could kind of maybe speak to whether or not there's a bit of a lull in activity, you know, here in the second half, and maybe that activity kind of picks up a little bit in the winter.
Leo Mariani: 25% I'm just looking at your turn in line schedule. The vast majority of turn in lines is going to happen here in one case. So if you could kind of maybe speak to whether or not there's a bit of a lull in activity.
Leo Mariani: And your next question comes from Leo Mariani with Ross, please go ahead.
Leo Mariani: Here in the second half and maybe that activity kind of kicks up a little bit in the winter and then could you also kind of relate that to capex trends and it looks like capital.
Leo Mariani: Next is down a little bit in <unk> versus <unk>, and maybe just kind of help a little bit with the trajectory on capex in the second half.
Leo Mariani: Yes sure.
Leo Mariani: First of all with what we talked about last time Leo.
Unknown Executive: And then could you also kind of relate that to CAPEX trends? I mean, it looks like CAPEX is down a little bit in two queue versus one queue, and maybe just kind of help a little bit with the trajectory on CAPEX in the second half.
Speaker Change: Basically the bulk of the tools were weighted towards the front half of the year. Our next batch of sales would be towards the latter part of Q4, So what youll see on the production front is kind of sequential decline. So it will be lower in Q3, and then lower in Q4 until that next batch tools comes on and then Capex will track that so capex will be lighter in Q3, and then pick back up in Q4 win.
Unknown Executive: Yeah, sure. Sort of similar to what we talked about last time, Leo. Basically, the bulk of the tills were weighted towards the front half of the year, our next batch of tills would be towards the latter part of Q4. So what you'll see on the production front is kind of sequential decline. So we lower in Q3, and then lower in Q4 until that next batch of tills comes on. And then CapEx will track that, right? So CapEx will be lighter in Q3, and then pick back up in Q4, when you know, we get back to it on the activity front.
Leo Mariani: Said that capex was pretty far half weighted, um, in 259 scheduled, the vast majority of turning lines at least they happen here, um, in 1 Q. So if you could kind of maybe speak to whether or not there's a bit of a, a lull, uh, an activity, uh, you know, here in the second half and maybe that activity kind of picks up a little bit in the winter and I think that you also kind of relate that to to capex Trends. I mean looks like capex is down a little bit in in 22 versus 1 Cube and maybe just kind of helped a little bit with the trajectory on capex in the second half.
Leo Mariani: Yeah, sure. Um, for some of what we talked about last time, Leo, um,
Leo Mariani: We get back to it on the activity front.
Speaker Change: Okay. So it sounds like Theres a bit of a hiatus in activity then it kind of kicks off late this year to get you already for kind of a winner in 26 is that kind of what do you think about it.
Speaker Change: Yeah that that's the right way to think about it. The you know we're going continue to run the one rig program on the drilling side and completion activities will hit a bit of a lull.
Leo Mariani: Basically, the bulk of the hills were weighted towards the front half of the Year, our next batch of Tails would be towards the latter part of Q4. Um, so what you'll see on the production front is kind of sequential decline. So it'll be lower in Q3 and then lower in Q4 until that next batch. Tills comes on and then capex will track that, right? So capex will be lighter in Q3 and then pick back up in Q4 when you know we get back to it on the the activity front.
Unknown Executive: Okay, so it sounds like there's a bit of a hiatus in activities and it kind of kicks off late this year to get y'all ready for kind of the winter in 26. Is that kind of the way to think about it? Yeah, that's the right way to think about it. You know, we're going to continue to run the one rig program on the drilling side, and then completion activities will hit a bit of a lull. And then those will pick back up in the fall as we get ready for the tills that I talked about in the December timeframe.
Speaker Change: It will pick back up in the fall as we get ready for the tools that I talked about at the December timeframe.
Speaker Change: Okay. That's helpful.
Leo Mariani: Okay, so it sounds like there's a bit of a Hiatus in activity. Then it kind of picks up late this year to get you all ready for kind of the winter and in 26 is that kind of what you think about it?
Speaker Change: And then just on the Utica, obviously, you all seem excited about that it sounds like the costs are already below your target here on the wells. It's nice to see you know at this point given you're beating the target do you think theres more room to go on the cost side or maybe that can kind of come down and apart from the cost could you kind of speak to the actual.
Unknown Executive: Okay, that's helpful.
Yeah, that that's the right way to think about it. You know, we're going to continue to run the 1 rigid drilling side and then completion activities. We'll hit a bit of a law. Um, and then those will pick back up in the fall as we get ready for the tills that I talked about in the December time frame.
Leo Mariani: And then just on the Utica, obviously, y'all seem excited about that. Sounds like the costs are already below your target here on the wells. That's nice to see. You know, at this point, given you've beaten the target, do you think there's more room to go on the cost side, or maybe that can kind of come down?
Speaker Change: <unk> well results production performance, how are the results trending versus your expectations and maybe just overall, how do you see this kind of competing with the Marcellus.
Leo Mariani: And apart from the cost, could you kind of speak to the actual well results, production performance? How are the results trending versus your and maybe just overall, how do you see this kind of competing with the Marcellus?
Speaker Change: Yeah. Good morning. This is not me so just wanted to kind of.
Speaker Change: Outlined on the Utica Oh, we have done a really as you know the team has done a really great job or on optimizing our.
Speaker Change: Drilling and completion operation over the last couple of years.
Navneet Behl: Leo, good morning. This is Navneet. So just wanted to kind of, you know, outline on the Utica. We've done a really, you know, team's done a really great job over on optimizing our, you know, drilling and completion operation over the last, you know, couple years. We're really pleased with, with the performance so far, but but we're not satisfied yet. So, and we are aggressively, you know, trying to improve the performance over the next few quarters. So stay tuned on where we can, you know, get down, increase our operational efficiency and reduce our costs.
Speaker Change: Okay. That's helpful. Um, and then just on the udica uh obviously y'all seem excited about that sounds like the costs are already below. Uh, your target here on the wells. It's nice to see. Um, you know, at this point giving you beating the target, do you think there's more room to go on the cost side or maybe that can kind of come down and apart from the cost? Could you kind of speak to the actual, well, results, production performance? How how are the results trending, uh, versus your expectations and maybe just overall? How do you see this? Kind of competing with the Marcellus
Speaker Change: We're really pleased with the performance so far but we're not satisfied yet.
Speaker Change: And we are aggressively trying to improve the performance over the next few quarters.
Speaker Change: Stay tuned on where we can get down increase our operational efficiency and reduce our costs.
Speaker Change: So that's one second on the performance.
Speaker Change: All our Utica wells are performing within our expectations and our latest hills that we got in Q2 or slightly above.
Navneet Behl: So that's one. Second, on the performance, all our Utica wells, our performance are within our expectations. And our, you know, latest tills that we got in Q2 are slightly, you know, above our expectation. So, so we are really, you know, excited about the deep Utica play. And we look forward to kind of, you know, continuing to kind of you know, get more wells in there.
Speaker Change: Above our expectation. So so we are really excited about the deep Utica play and we look forward to kind of you know continuing to kind of.
Navi: Video. Good morning. Uh, this is Navi. Uh, so just wanted to, uh, kind of, uh, you know, outline on the udica, uh, uh, we've done a really, you know, team's done a really great job or on optimizing our, uh, you know, and drilling, uh, and completion operation over the last, you know, couple of years. Uh, we were really pleased with, uh, with the performance so far, but, but we are not satisfied yet. So and we are aggressively you know, trying to improve the performance over the next few quarters. So so say stay tuned on where we can, you know, get down, uh increase our operational, efficiency and and reduce our costs.
Speaker Change: Get more wells in there.
Speaker Change: And then maybe I'll address the last part of your question on how do we think about the Utica and the Marcellus.
Navi: So so that's 1 second on the performance. Uh, all are Utica. Wells are performance are within our expectations and our uh, you know, latest uh, pills that we got in uh Q2 are slightly, you know, uh, above our expectation.
Speaker Change: So we've been very intentional and given that and the operating team a nice runway here to really demonstrate they are proud to be able to drive these costs down.
Unknown Executive: And then Leo, maybe I'll address the last part of your question on how we think about the Utica and the Marcellus sort of mix. We've been very intentional in giving Nav and the operating team a nice runway here to really demonstrate, you know, their prowess and being able to drive these costs down. Moving ahead, obviously, you know, we're going to continue to develop our core Southwest PA field over the next few years. But we also, as Nav pointed out, we want to keep getting him reps at the Utica wellhead there, so he can continue to work on, you know, cost efficiency.
Speaker Change: Moving ahead, obviously, you know we're going to continue to develop our core southwest P. A field over the next few years, but we also as <unk> pointed out we want to keep getting him reps at the Utica well have there. So we can continue to work on cost efficiencies.
Speaker Change: Okay I appreciate all the detail. Thank you.
Speaker Change: Thank you.
Noah Hung: And your next question comes from Noah Hung Miss with Bank of America. Please go ahead.
Unknown Executive: So, Okay, appreciate all the detail.
Noah Hung: Hey, good morning, I was hoping to ask on 45 fee again.
Speaker Change: So so we are really, you know, excited about the the dpd car play and we look forward to kind of, you know, continuing to kind of, you know uh get more wells in there Leo. Maybe I'll I'll address the last part of your question on how we think about the Utica and the, Marcellus sort of mix. So we we've been very intentional in giving nav operating team, a nice Runway here to really demonstrate, you know, their prowess and being able to drive these costs down. Moving ahead. Obviously you know we're going to continue to develop our our core Southwest PA field over the next few years. But we also as now pointed out we want to keep getting him reps at the the unicycle Wellhead there so he can continue to work on you know cost efficiencies
Unknown Executive: Thank you.
Noah Hung: When do you think you'd be able to reach that $30 million a year run rate and when you do realize the full $30 million of additional free cash flow from 45 Z. What should we think that all of your RMG gas would be sort of shifted to qualify for this 45 is the opportunity for us.
Speaker Change: Okay, appreciate all the detail. Thank you. Yep. Thank you.
Noah Hungness: The next question comes from Noah Hungness. America, please go ahead. Good morning.
Noah Hungus: In your next question comes from Noah hungus with Bank of America. Please go ahead.
Unknown Executive: I was hoping to ask on 45Z again. When do you think you'd be able to reach that 30 million a year run rate, and when you do realize the full 30 million of additional pre-cash flow from 45Z, should we think that all of your RMG gas would be sort of shifted to qualify for this 45Z opportunity, or will some of it still be used to qualify for the PA AEC Tier 1? Yeah, so the way to think about timing, like I said, so 25 is the first year of eligibility for the program, but the cash associated with that wouldn't occur until you file your tax return for 25 and 26, right?
Noah Hung: It will some of it still be.
Noah Hung: It will be used to qualify for the Ta AUC tier one credit.
Noah Hung: Yes, so everybody to think about timing. It makes it. So 25 is the first year of eligibility for the program, but the cash associated that wouldn't occur until you file your tax return for 25 and 26 right. That's what you would create the tax credit that would be fungible, when you convert that to cash in the market.
Good morning. I was hoping to ask on uh, 45z again. Um, yeah, when do you think he'd be able to reach that uh 30 million a year, run rate and when you do realize the full 30 million of additional free cash flow from 45z, should we think that all of your RMG gas would be sort of shifted to
Uh, qualify for this 45z opportunity or will some of it still be, uh, still be used to qualify for the PA aec. Tier 1 Credit.
Noah Hung: In terms of volumes that qualify I mean bigger picture of the our initial read on the guidance says that a stackable.
Noah Hung: We're able to take advantage of both.
Unknown Executive: That's when you would create the tax credit that would be fungible, and you could convert that to cash in the market. In terms of volumes that qualify, I mean, bigger picture, our initial read on the guidance is that it's stackable. So you're able to take advantage of both programs in terms of 45Z and the PA Tier 1 REC. But the volumes don't qualify one for one. So some volumes might qualify under Tier 1 RECs, and some volumes might qualify under 45Z. So it's a blend of which ones do and which ones don't. And at this time, it's all still subject to that final rule.
Noah Hung: In terms of 45 G. M S. P. A tier one rack, but there the volumes don't qualify one for one so some volumes might qualify under tier one Rex and some volumes might qualify under 45 days. So it's a blend of which ones do and which ones don't and you know at this time, it's all still subject about the final rule.
Noah Hung: We're optimistic as long as things fall your initial guidance.
Noah Hung: But there's still a bit of a waiting waiting for you on that.
Noah Hung: Gotcha, that's helpful color and then for my second question.
Noah Hung: Could you maybe talk about why our credit price is underwriting the revised and I'll attribute free cash flow guide of $65 million.
Unknown Executive: We're optimistic as long as things follow the initial guidance. There's still a bit of a wait and see on that.
Noah Hungus: You know, at this time, it's all still subject to that final rule. Um, you know, we're we're optimistic as long as things follow the initial guidance. Um,
Noah Hungus: there's still a bit of uh, waiting waiting to see on that.
Noah Hung: Yeah, it's sort of where the market is that now we treat it very similar to how we report kind of the opening prices for the rest of the year just kind of look at the peer tier one strip that's in the mid Twenty's right now.
Unknown Executive: Thank you so much, Alpacolor.
Unknown Executive: And then for my second question, could you maybe talk about what credit price is underwriting the revised environmental attribute free cash flow guide of $65 million I I I Yes, it's sort of where the market's at now. We treat it very similar to how we report kind of the open prices for the rest of the year.
Noah Hung: From a megawatt hour.
Noah Hungus: Gotcha. That's helpful caller. And then for my second question um could you maybe talk about what uh credit price is underwriting, the revised environmental attribute free cash flow guide of 65 million.
Unknown Executive: You just kind of look at the POT or one strip, and that's in the mid 20s right now. for the Megawatt Hour.
Jacob Roberts: And your next question comes from Jacob Roberts with T. P. H. Please go ahead.
Noah Hungus: Yeah it's it's sort of where the market's at now we we treat it very similar to how we report kind of the open prices for the rest of the year. Just kind of look at the the P or 1 strip and that's in the mid 20s right now.
Jacob Roberts: Good morning.
Noah Hungus: For the megawatt hour.
Jacob Roberts: Hey, good morning.
Jacob Roberts: Maybe a bit of a follow on to that last question should we be thinking about the $30 million as a function of the of the RMG input or are the result of some sort of downstream output.
Jacob Roberts: Your next question comes from Jacob Roberts with TPH. Please go ahead. Good morning. Maybe a bit of a follow on to that last question. Should we be thinking about the 30 million as a function of the of the RMG input or the result of some sort of downstream output?
In your next question comes from. Jacob Roberts with tph, please go ahead.
Jacob Roberts: The tax credit is for the incentivize the collection of waste gas off the backside of coal mines are creating a salable product into the pipeline.
Jacob Roberts: Good morning.
Jacob Roberts: Good morning.
Jacob Roberts: Does that makes sense. So that's why it's a thought about more is remediated are abating and emission source.
Jacob Roberts: Maybe a bit of a follow on to that last question. Should we be thinking about the 3000, as a function of the of the RMG input or the result of some sort of Downstream output?
Unknown Executive: The tax credit is for the incentivizing the collection of waste gas off the backside of coal mines and creating a saleable product into the pipeline. if that makes sense. So that's why it's thought about more as remediating or abating an emission source. Okay, that's helpful.
Speaker Change: Okay. That's helpful. And then I just wanted to give you guys the opportunity to talk a little bit about the AI and introduce Ahmed I know you mentioned it in the release and in specifically were wondering how much the RMG product is factoring into those conversations.
Jacob Roberts: But the tax credit is for the incentivized and the collection of waste, gas off the back, side of coal mines and creating a scalable product into the pipeline.
Jacob Roberts: If that makes sense. So that's why it's thought about more as remediating, a or abating a, an emission source.
Unknown Executive: And then I just wanted to give you guys the opportunity to talk a little bit about the AI and Energy Summit. I know you mentioned it in the release. And specifically, we're wondering how much the RMG product is factoring into those conversations with any counterparties, maybe in particular, the tech guys? And ultimately, do you think there is a pathway for RMG to get better economics on some of the potential deals there, relative to the current pathways you've laid out? Yeah, great question. No, we're, we're super excited. You know, our mantra around here is Appalachia first, all of this AI stuff is going to be great for, great for the region.
Speaker Change: With any counterparties, maybe in particular, the tech guys and ultimately do you think there is a pathway for RMG to get better economics on some of the potential deals there there relative to the current pathways you've laid out.
Speaker Change: Yeah, Great question No. We're we're Super excited you know our mantra around here is Appalachia first of all all of this AI stuff is going to be great for great for the region are great for the industry and in particular, you know kind of our lane that we're super focused on right now which is.
Jacob Roberts: Okay, that's helpful. And and then I just wanted to give you guys the opportunity to talk a little bit about the AI and energy Summit. I know you mentioned it in the release and and specifically we're wondering you know how much the uh RMG product is factoring into those conversations uh with any counterparties, maybe in particular, The Tech Guys, and ultimately, do you think there is a pathway for RMG to get better economics on some of the potential deals near their, their relative to the current Pathways you've laid out
Speaker Change: Offering the RMG product to the market is it a true sustainable kind of energy solution to.
Speaker Change: To get the folks that are using that gas down to a zero carbon sort of profile on these new data centers.
Unknown Executive: Great for the industry. And in particular, you nailed kind of our lane that we're super focused on right now, which is, you know, offering the RMG product to the market as a true sustainable kind of energy solution to get folks that are using NatGas down to a zero carbon sort of profile on these new data centers. Obviously, we've been having discussions with folks, you know, we have third party marketers having discussions with folks, and we're excited to see that develop, and not just on the existing volumes, but enough incentive from the voluntary markets to go out and gather some additional volumes, hopefully.
Speaker Change: Obviously, we've been having discussions with folks you know we have third party marketers to having discussions with folks and we're excited to see that develop not just on the existing volumes, but enough incent them from the voluntary markets to go out and gather some additional volumes hopefully Jacob this is Nick just to sort of follow on your balance.
Speaker Change: The way, we look holistically at the AI opportunity and Remediated mind gas RMG, it's another.
Speaker Change: Industry pathway, whatever you'd want to call it to get the value of it recognized the utilized so we started with manufacturing an arm's length transactions that recognized it for manufacturing downstream products. We've got it recognized of course and the power grid under the Pennsylvania.
Yeah, great question. Now we're we're super excited. You know, our Mantra around here is Appalachia first. All all of this AI stuff is going to be great for great for the region. Um, great for the industry and in particular you nailed kind of our lane that we're super focused on right now, which is um, you know, offering the RMG product to the market as a a true sustainable kind of energy solution. Um to get the folks that are using that gas down to a zero-carbon sort of profile on these new data centers. Um, obviously we've been having discussions with folks, you know, we have third-party marketers, having discussions with folks and we're excited to see that develop and and not just on the existing volumes but enough incentive from the voluntary markets to go out and gather some additional volumes. Hopefully and Jacob, this is Nick just to sort of follow on with Allan the way we look holistically at the AI opportunity and and remediated mind gas RMG, it's another um industry pathway.
Speaker Change: You see we then were able to get it recognized in the hydrogen economy with was forty-five V. Now transportation of alternative fuels with 45 Z and this would be another critical pathways that are that I think makes a whole bunch of sense and it has a certain level of inevitability to it but the timing and the magnitude of it it is still a TBD.
Unknown Executive: We then were able to get it recognized in the hydrogen economy with 45E. Now, transportation of alternative fuels with 45Z. And this would be another critical pathway that I think makes a whole bunch of sense and has a certain level of inevitability to it. But the timing and the magnitude of it, it's still a TBD. Great, appreciate the time guys. Yeah, Rob.
Speaker Change: Okay.
Speaker Change: Great I appreciate the time guys.
Speaker Change: Yeah, Rob.
Speaker Change: And your next question comes from Michael <unk> with Stephens. Please go ahead.
Michael: Hey, good morning, everybody just to follow on the AI topic. There are obviously a lot of news recently on the gas.
Michael Scialla: Your next question comes from Michael Scialla with Stevens, please go ahead.
Michael: Gas providing power for data centers in the region just wanted to get your updated thoughts on.
Unknown Executive: Good morning, everybody. Just to follow on the AI topic there. Obviously, a lot of news recently on gas providing power for for data centers in the region. Just want to get your updated thoughts on Invasive demand and does that have any impact on your long term view of natural gas prices in your hedging strategy? Yeah, I don't think it has the impact on our hedging strategy. In the short term, you know, our hedging strategy is a function of how we manage the balance sheet and how we manage our overall capital allocation program. I think long term, it's absolutely going to be bullish, you know, anything that creates in-basin demand, given our kind of interstate pipe restrictions that we've experienced over the last decade, it's going to help everyone in-basin.
Michael: And based on demand and does that have any impact on your long term view of natural gas prices in your hedging strategy.
Michael: Yeah, I don't think it has any impact on our hedging strategy.
Michael: In the short term in our hedging strategy as a function of how we manage the balance sheet and how we manage our overall capital allocation program I think long term, it's absolutely going to be bullish you know anything that Caribbean basin demand, given our kind of interstate pipe restrictions that we've experienced over the last decade.
Michael: It's going to help everyone in basin.
Michael: So it's more of a wait and see mode. You know from our position is we have the depth of inventory we have the ability to deliver gas. It's just not a wait and see which projects come online and how we can better from that.
Michael: Yes, Michael I think too.
Unknown Executive: So we're more of a wait and see mode, you know, from our position is we have the depth of inventory, you know, we have the ability to deliver gas, it's just now wait and see which projects come online and how we can benefit from that.
Michael: The prior experiences that we've had in similar types of opportunities for the industry and for the region.
Michael: When youre looking at potentially new demand being created that journey to where we end up actually versus what we're hearing and what people are projecting today, it's obviously going to be very different theres going to be all kinds of factors and changes and twists and turns so as to which plants get built and you know when they are online and with the <unk>.
Unknown Executive: Yeah, Michael, I think to the prior experiences that we've had in similar types of opportunities for the industry and for the region, when you're looking at potentially new demand being created, that journey to where we end up actually versus what we're hearing and what people are projecting today, it's obviously going to be very different. There's going to be all kinds of factors and changes and twists and turns. So as to which plants get built and you know, when they're online and what the timing of all that is, there's just a lot of things to be figured out between today and then the future.
Michael: And of all of that is there's just a lot of things to be figure it out between today and then the future and that's why I think you saw that too since the summit with what's going on with volatility on pricing. That's why we basically love the opportunity in the developments it would mean for demand for natural gas and what it could mean for the region in terms of sort of a.
Unknown Executive: And that's why, and I think you saw that too, since the summit with what's going on with volatility on pricing. That's why we basically love the opportunity and the developments it would mean for demand for natural gas and what it could mean for the region in terms of sort of a reindustrialization or revitalization of a lot of these communities. But in terms of, you know, taking positions today, and speculation of what that's specifically going to mean when it comes to things like hedge book and capital allocation, our playbook, our philosophy, our approach remains exactly the same.
Michael: Reindustrialization of revitalization of a lot of these communities, but in terms of taking positions today and speculation of what that specifically going to mean when it comes in things like hedge book and capital allocation, our playbook, our philosophy our approach remains exactly the same.
Michael: Yeah makes sense.
Michael: Wanted to get your thoughts on that.
Michael: The second quarter production surprised a little bit wanted to see if you could pinpoint where that came from was it new wells outperforming expectations base decline the picking.
Unknown Executive: Yeah, makes sense.
Michael: Ill.
Unknown Executive: I want to get your thoughts on the second quarter production surprise a little bit. I wanted to see if you could pinpoint where that came from. Was it new wells outperforming expectations, base decline, anything else?
Michael: Hi.
Michael: So our production outperformance was basically like you know four four things coming together for us the first one as our new <unk> performance.
Michael: The apex Marcellus wells in our Utica wells.
Unknown Executive: Hi. So, our production, you know, our performance was basically like, you know, four things coming together for us. The first one is our new tilt performance, the Apex Marcellus wells and our Utica wells. They've done really well. So, and the second part is our operational execution, which has, you know, given us opportunity to kind of move some of this forward. The third part is our production efficiency gains on our base production. So, we are doing really well there. And the last part is like our uptime on base production.
Michael: And they've done really well.
Jacob Roberts: So our production outperformance was basically like you know four four things coming together for US. The first one is our new tool performance.
Michael: And the second part as our operational execution, which has given us opportunity to kind of move some of this forward.
Michael: Third part is our production efficiency gains on our on our base production. So we are we're doing really well there and and the last part is like our uptime on on base production.
Jacob Roberts: And the apex Marcellus wells in our Utica wells.
Jacob Roberts: And they've done really well in the second part as our operational execution, which has given us opportunity to kind of move some of this forward.
Michael: So all four combined led to this result.
Jacob Roberts: The third part is our production efficiency gains on our on our base production. So we are we're doing really well there and and the last part is like our uptime on base production.
Speaker Change: Sounds good thank you very much guys.
Speaker Change: And your next question comes from Betty Chen with Barclays. Please go ahead.
Unknown Executive: So all four combined kind of led to this result.
Jacob Roberts: So all four combined lifted this result.
Betty Chen: Good morning. Thank you for taking my question I wanted to go back and ask about the deep Utica results again.
Unknown Executive: Sounds good. Thank you very much, guys.
Speaker Change: Sounds good thank you very much guys.
Betty Jang: And your next question comes from Betty Jang with Barclays. Please go ahead.
Betty Zhang: Your next question comes from Betty Zhang with Barclays, please go ahead. Good morning. Thank you for taking my question. I want to go back and ask about the Deep Utica results again. In your view, how much do you think cost will have to come down for the Deep Utica to compete with Marcella's returns? And then, broadly speaking, from what we can tell, the Utica wells are fairly concentrated right now. So, we'd love to get your thought about the consistency of Utica performance on your agency. Yeah, I would say on the first question, Where we're at right now on sort of the cost structure, we think that makes us well as competitive with kind of best in basin opportunities, even on the Southwest PA, sort of Marcella's stuff.
Betty Chen: In your view how much do you think costs will have to come down for the deep Utica to compete with Marcellus returns.
Betty Jang: Good morning, Thank you for taking my question.
Betty Chen: And then.
Betty Chen: Broadly speaking from what we can tell the Utica wells are fairly causing trade. It right now so we would love to get your thoughts about the consistency of Utica performance I our acreage.
Betty Jang: Wanted to go back and ask about the deep Utica results again.
Betty Jang: In your view how much do you think costs will have to come down for the deep Utica to compete with Marcellus returns.
Betty Jang: Then.
Betty Chen: Yeah, I would say on the first question.
Betty Jang: Are you speaking from what we can tell the Utica wells are fairly constant trade. It right now so we would love to get your thought about the consistency of Utica performance I our acreage.
Betty Chen: Where we're at right now on sort of the cost structure, we think that it makes sense as well as competitive with kind of best in basin.
Betty Chen: Opportunities even on the southwest PA Marcellus stuff.
Betty Chen: The longer term.
Betty Jang: Yeah, I would say on the first question.
Betty Chen: We're going to we're going to step out from where we're at now but our expectation is that there's a pretty long runway across our field up there to make these results are beautiful.
Betty Jang: Where we're at right now on sort of the cost structure, we think that makes those wells competitive with kind of best in basin.
Betty Jang: Opportunities even on the southwest PA Marcellus stuff.
Speaker Change: Okay. Thanks a.
Betty Chen: A follow up on the Hum.
Unknown Executive: The longer term, you know, we're gonna step out from where we're at now, but our expectation is that there's a pretty long runway across our field up there to make these results repeatable. A follow-up on the...
Betty Jang: The longer term.
Speaker Change: And a new tech.
Betty Jang: We're going to step out from where we're at now but our expectation is that there's a pretty long runway across our field up there to make these results repeatable.
Speaker Change: Just as it related to the gas power for.
Speaker Change: For AI.
Speaker Change: Think about your value recognition.
Betty Jang: Okay. Thanks.
Speaker Change: For.
Speaker Change: A follow up on the.
Speaker Change: That's where the gas is it fair to think about it from a voluntary carbon credit perspective, where you are selling the attributes.
Betty Jang: And a new tech.
Unknown Executive: Just as related to the gas power for AI, when you think about your value recognition, For the gas, is it fair to think about it from a voluntary carbon credit perspective where you're selling the attributes to tech companies looking to reduce their carbon footprint or is it through compliance market or other channels? Yeah, on the RMG front, we're going to sell to whichever market recognizes the highest value, right? I mean, currently, that is the latter one that you pointed out, kind of the renewable energy credit markets for the existing RPS programs. But there is a, you know, a finite amount of this resource that's available.
Betty Jang: Just as it related to the gas power.
Betty Jang: For AI.
Speaker Change: Two tech companies looking to reduce their carbon footprint or is it through compliance market or other channels.
Betty Jang: When you think about your value recognition for.
Betty Jang: That's where the gas is it fair to think about it from a voluntary carbon credit perspective, where you are selling the attributes.
Speaker Change: Yeah on the RMG front that we're gonna start to whichever market recognizes the highest value right. I mean currently that is the latter whether you pointed out is kind of the renewable energy credit markets.
Betty Jang: Two tech companies looking to reduce their carbon footprint or is it through compliance market or other channels.
Speaker Change: Existing rps programs.
Speaker Change: But there is a you know a finite amount of this resource that's available and we think you know the environmental attribute should result in some voluntary pricing that rivals the regulatory pathways in the long term that are you also bring up another good point with the question, which is the focus currently right has really shifted with the opportunity of AI in places.
Betty Jang: Yeah on the RMG front, we're going to start to whichever market recognizes the highest value right. I mean currently that is the latter whether you pointed out is kind of the renewable energy credit markets.
Betty Jang: Existing rps programs.
Betty Jang: But there is a you know a finite amount of this resource that's available and we think the environmental attribute should result in some voluntary pricing that rivals that of regulatory pathways. In the long term that are you also bring up another good point with the question which is the.
Unknown Executive: And we think, you know, the environmental attributes should result in some voluntary pricing that rivals the regulatory pathways in the long term. Betty, you also bring up another good point with the question, which is, the focus currently, right, has really shifted with the opportunity of AI in places like Appalachia to enact gas demand and the construction of the data centers and power plants to power them, etc.
Speaker Change: Like Appalachia too.
Speaker Change: To Nat gas demand in the construction of the Datacenters and power plants to power them et cetera, but there's also another issue that's been there from the get go and it will remain at just maybe as perhaps falling a bit below the radar, which is the sustainability solution or the sustainability path to making all of this growth occur.
Betty Jang: The focus currently right has really shifted with the opportunity of AI in places like Appalachia.
Betty Jang: To Nat gas demand in the construction of the Datacenters and power plants to power them et cetera, but there's also another issue that's been there from the get go and it will remain at just may be is perhaps fallen a bit below the radar, which is the sustainability solution or the sustainability path to making all of this growth occur and the ulta.
Unknown Executive: But there's also, you know, another issue that's been there from the get go, that will remain, it just maybe has perhaps fallen a bit below the radar, which is the sustainability solution or the sustainability path to making all this growth occur. And the ultimate sort of clients and drivers of that, the tech industry, hasn't sort of backed up with regard to sustainability or carbon goals, one step since they originally set them and now this new growth option for them is going to make that even more of a heightened challenge. So I think RMG playing a role in how this ultimately plays out, has never been in more demand.
Speaker Change: And the ultimate sort of clients and drivers of that the tech industry Hasnt sort of backed up with regard to sustainability, our carbon goals one step since they originally set them and now this new growth option for them is going to make that even more of a heightened challenge. So I think RMG playing a role in how this ultimately plays.
Betty Jang: <unk> sort of clients and drivers of that the tech industry Hasnt sort of backed up with regard to sustainability, our carbon goals one step since they originally set them and now this new gross option for them is going to make that even more heightened challenge. So I think RMG playing a role in how this ultimately plays out.
<unk> has never been more demand and to your point I think the tech industry will play a key role in that.
Anthony: I'm, sorry, if I could follow up on that Anthony.
Speaker Change: Yeah.
Speaker Change: Hum.
Unknown Executive: And to your point, I think the tech industry will play a key role in that.
Betty Jang: It has never been more demand and to your point I think the tech industry will play a key role in that.
Speaker Change: If in a voluntary carbon market perspective would that would that be incremental to P. A rec market or 45 days.
Betty Jang: And sorry, if I could just follow up on that.
Unknown Executive: if I could just follow up on that, thank you.
Speaker Change: Thank you.
Betty Jang: Uh huh.
Speaker Change: At some point you can only sell into one market. So traditionally the volunteers depend.
Unknown Executive: In the voluntary carbon market perspective, would that be incremental to PA REC market or 45 years? At some point, you can only sell into one market. So traditionally, the volunteers, depending on which pathway you're using, they might not be stackable. So it's all very facts and circumstances dependent. So I hesitate to give a general answer. But the way to think about it is you can generally get maybe one to two stacking, but you're not going to get beyond that. Yeah, think of it as another pathway that would compete with your other alternatives. So not, generally not stackable.
Speaker Change:
Speaker Change: If in a voluntary carbon market perspective with that.
Speaker Change: Depending on which path, we're using that they might not be stackable. So it's all very facts and circumstances dependent so I hesitate to give a general answer but.
Speaker Change: Would that be incremental to P. A rec market or 45 days.
Speaker Change: Way to think about it is you can generally get maybe one to two stacking, but youre not going to get beyond that yes, I think of it as another pathway we compete with your other alternatives.
Speaker Change: At some point you can only sell into one market. So traditionally the voluntary.
Speaker Change: Depending on which path, we're using that they might not be stackable. So it's all very facts and circumstances dependent so I hesitate to give a general answer but.
Speaker Change: Not currently not stack.
Speaker Change: Got it thanks.
Speaker Change: Way to think about it is you can generally get maybe one to two stacking, but youre not going to get beyond that I think of it as another pathway, we compete with your other alternatives.
Speaker Change: Again, if you have a question. Please press Star then one.
David: Your next question comes from David <unk> with TD Cowen. Please go ahead.
Speaker Change: Not definitely not staffed.
Speaker Change: Got it thanks.
David: Thanks, if I can Alan and team for taking my questions today.
Unknown Executive: Again, if you have a question, please press star, then 1.
Speaker Change: Again, if you have a question. Please press Star then one.
Speaker Change: Yeah I just wanted to follow up on just the Utica mix you talked about just given more at bats next year as we just think about the general activity level that you guys have laid out.
David Dekelbaum: Your next question comes from David Dekelbaum with T.D. Cowan. Please go ahead. Thanks, Nick and Alan and team for taking my questions today. Yeah, I just wanted to follow up on just the Utica mix. You talked about just giving more at-bets next year.
Speaker Change: Your next question comes from David Decal bomb with TD Cowen. Please go ahead.
Speaker Change: Thanks, Mike and Alan and team for taking my question today.
Speaker Change: Should we think about the Utica, taking more share of the program over the next couple of years or is there still some more headway to make on the cost side before it becomes a larger contribution.
Speaker Change: Yeah I just wanted to follow up on just the Utica mix you talked about just given more at bats are next year as we just think about the general activity level that you guys have laid out.
Unknown Executive: As we just think about the general activity level that you guys have laid out, should we think about the Utica taking more share of the program over the next couple of years, or is there still some more headway to make on the cost side before it becomes a larger contributor? Now, I would go back to what I said on one of the earlier questions. I think at this point in the cost structure, these wells are in the mix in terms of IRR competitiveness. So you're going to see them in the program moving forward. And what we're really trying to do is balance the harvesting of the Southwest PA sort of field that's fully developed with any potential kind of step out in the new CPA area.
Speaker Change: No I would go back to what I said on one of the with your other questions I think at this point in the cost structure of these wells are in the mix in terms of IRR competitiveness, so youre going to see them in the program moving forward and what we're really trying to do is balance the harvesting of the southwest P. A sort of feel that's fully developed with the any potential kind of step out and the new CPA area.
Speaker Change: Should we think about the Utica, taking more share of the program over the next couple of years or.
Speaker Change: Is there still some more headway to make on the cost side before it becomes a larger contribution.
Speaker Change: No I'll go back to what I said on one of the earlier questions I think at this point in the cost structure of these wells are in the mix in terms of IRR competitiveness, so youre going to see them in the program moving forward and what we're really trying to do is balance the harvesting of the southwest P. A sort of feel that's fully developed with the any.
Speaker Change: So you know we look at every project on a kind of a full cycle IRR basis, and that's how we determine the mix you said, we've been very intentional recently and just given that lots of that bats.
Speaker Change: To demonstrate repeatability, but moving forward I think we're comfortable that we can be super focused on just the best projects at the right time.
Speaker Change: Any potential kind of step out and the new CPA area.
Unknown Executive: So you know, we look at every project on a kind of full cycle IRR basis. And that's how we determine the mix. You said we've been very intentional recently, and just given Nav lots of that to demonstrate repeatability. But moving forward, I think we're comfortable that we can be super focused on just the best projects at the right time. Appreciate that.
Speaker Change: So you know we look at every project on a kind of a full cycle IRR basis, and that's how we determine the mix you said, we've been very intentional recently, just given now lots of at bats.
Speaker Change: I appreciate that and then just to follow up on conversations just around.
Speaker Change: Our marketing and and obviously in basin demand.
Speaker Change: To demonstrate repeatability, but moving forward I think we're comfortable that we can be super focused on just the best projects at the right time.
Speaker Change: As you sit today, we go until I went there you guys talked about before kind of hitting tank tops or so as we get into fall and then sort of setting up for 'twenty six.
Speaker Change: I appreciate that and then just to follow up on conversations just around.
Unknown Executive: And then, you know, just to follow up on conversations just around Marketing and obviously In Basin Demand, as you said today, we go into winter, you guys talked about before, you know, kind of hitting tank tops or so as we get into fall and then sort of setting up for 26, you know, there's been a lot of contracts that seem like they're in the early days of being signed right now.
Speaker Change: There there's been a lot of contracts that seem like they are in the early days of being signed right now from from where you sit do you think is sort of best to see this market get appreciably tight.
Speaker Change: Marketing and obviously in basin demand.
Speaker Change: As you sit today, we go until winter you guys talked about before kind of hitting.
Speaker Change: Tops are so as we get into fall and then sort of setting up for 'twenty six.
Speaker Change: Over the next few years and see in basin demand increase before signing long term agreements or is that something that you.
Speaker Change: There there's been a lot of contracts that seem like they're in the early days of being signed right now from from where you sit do you think is sort of best to see this market get appreciably tight over the next few years and see in basin demand increase before signing long term agreements or is that something that.
Unknown Executive: From where you sit, do you think it's sort of best to see this market get appreciably tight, you know, over the next few years and see In Basin Demand increase before signing long-term agreements or is that something that you think is going to be in your relative near future? Yeah, I think the first signal you want to see is an actual data center connected to some of the NatGas projects. I think once you see the first sort of data center sign up for electricity offtake here in Appalachia, that'll give folks a real sense of how the value is going to get distributed across the chain.
Speaker Change: Do you think it is going to be in your relative near future.
Speaker Change: Yeah, I think the first signal that you're wanting to see us at the National data center connected to some of the Nat gas projects I think once you see the first sort of data center side out for electricity offtake here in Appalachia that'll give folks a real sense of.
Speaker Change: You think it is going to be in your relative near future.
Speaker Change: Oh, the value's going to do it's distributed across the chain.
Speaker Change: Yeah, I think the first signal that you want to see is that the national data center connected to some of the Nat gas projects I think once you see the first sort of datacenter sign up for electricity offtake Youre in Appalachia that'll give folks a real sense of.
Speaker Change: Until you until you see that you know you were a little bit hesitant to lock in your kind of respective ownership of that economics. So theres as Nick pointed out there's still a lot of innings here, we're still very early.
Speaker Change: The value is going to give distributed across the chain.
Speaker Change: But there are some definite value in a wait and see how this plays out before locking up anything long term.
Unknown Executive: Until you see that, you know, you're a little bit hesitant to lock in your kind of respective ownership of that economics. So there's, as Nick pointed out, there's still a lot of innings here.
Speaker Change: Until you until you see that you were a little bit hesitant to lock in your kind of respective ownership of that economics. So theres as Nick pointed out there's still a lot of innings here, we're still very early.
Speaker Change: Appreciate it best of luck guys.
Speaker Change: This concludes our question and answer session I would like to turn the conference back over to Tyler Lewis for any closing remarks.
Unknown Executive: We're still very early, but there's some definite value in the wait and see how this plays out before locking up anything long term.
Speaker Change: But there are some definite value in a wait and see how this plays out before locking up anything long term.
Tyler Lewis: Thank you again for joining us. This morning, please feel free to reach out if anyone has any additional questions. Otherwise, we'll look forward to speaking with everyone again next quarter. Thank you.
Speaker Change: I appreciate it best of luck guys.
Speaker Change: This concludes our question and answer session I would like to turn the conference back over to Tyler Lewis for any closing remarks.
Tyler Lewis: And that concludes our question and answer session. I would like to turn the conference back over to Tyler Lewis for any closing remarks. Thank you again for joining us this morning. Please feel free to reach out if anyone has any additional questions. Otherwise, we'll look forward to speaking with everyone again next quarter. Thank you.
Speaker Change: Yeah.
Speaker Change: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Tyler Lewis: Thank you again for joining us. This morning, please feel free to reach out if anyone has any additional questions. Otherwise, we'll look forward to speaking with everyone again next quarter. Thank you.
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Tyler Lewis: The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Tyler Lewis: Yeah.
Tyler Lewis: Okay.
Tyler Lewis: Yeah.
Tyler Lewis: Yes.
Tyler Lewis: [music].
Tyler Lewis: Yeah.
Tyler Lewis: [music].