Expand Energy (EXE) 2 Nov 222022 Q3 Earnings call transcript

Good morning, and welcome to the Chesapeake Energy Third Quarter 2022 Earnings Teleconference. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Chris Ayres, Vice President, Investor Relations and Treasurer at Chesapeake Energy. Please go ahead.

Thank you, Andrew. thank Energy's joining and third and to call operating everyone, Chesapeake discuss quarter morning, you our for today results. Good XXXX financial release presentation had the our you've a to our Hopefully, chance website yesterday. updated we that press investor posted to review and

that call, information, statements underlying including forecasts, our goals, be this statements consist morning's forward-looking projections which reference expectations, performance statements. assumptions will regarding such we During confirmed and and making by be statements, of cannot existing the future to beliefs,

note duty there are a not that, and filings. our other recognize to Please as cause factors our place Please any of actual Including from no in identified statements. in number materially except press you will that on forward-looking and undue statements, factors by release and such statements. applicable reliance discussed results should that required SEC update law, to undertake forward-looking yesterday the we differ

refer some help may We measures with across periods which comparisons facilitate to and also peers. non-GAAP financial

For website. Nick measure and overview on and Dell'Osso, Viets. corresponding Singh found nearest a can give and the be reconciliation up GAAP our a any Mohit to teleconference of open we to me today are our the measure on Josh call Nick we non-GAAP brief results, then will With the use will Q&A.

So with that, it Nick. thank now to I'll you again. over turn

for all you call. our thank joining and morning, Good

that X we believe morning, get cover want most topics we Before important to this our Q&A are to to shareholders. I

momentum and LNG third is strategy industry-leading returns third cash our XXXX our is our be strong our continue and first execution, quarter is second The ready. to the into

few our will in the pushed Marcellus Haynesville some and well that those due and We a We another believe delays delivered in had So to the in temporary. Eagle we QX, production start strong be but delays to Ford. experience Ford volumes results production facility great some did had into on Eagle quarter off, operationally.

years. day and a In million production our delivery capacity. annual committed for in capacity new associated XXXX, and built XXX year. We're CapEx project pipeline significant our reaffirming guidance Haynesville, gathering be increased We've to We've of we play [Gilles.] also strides and from by with the feet treating midstream confidence also it. a and the down made an out reflecting our up year This to in cubic program this the for by sequestration XX% XX% as we've has to out the our Haynesville carbon capture to heart ranges momentum finish with

we're excited transformational we part to a this, be And really of think, project. and unique

XXXX the volumes in of to and and We pricing gives with us beyond pipe have XX% XX% and day transaction. the Golden take an or greater Pass opportunity for Bcf the Coast that expect more to both our equity of than that of contracted are option. project, to a participate This Momentum up than Haynesville Gulf we and delivery

fruition. synergies our Chief from continue Marcellus, to the come to In acquisition the

completions we're show our where And bit capacity of we've As of little lateral per looking to really design able up We've also the productivity length the in with of Lower well we're combined Marcellus to been to and the gathering of XXXX, before, forward do. add play, leasehold improved well. a core which pleased should systems. discussed the improvements maximizing we're enhanced longer

the of in all core zones the a co-development of the the in development Marcellus moving we're Upper basin of of to optimize forward Looking inventory. Marcellus, to

XX% and about XXXX the expect program Marcellus Upper Lower be Marcellus. to We

the return and Upper opportunity top Marcellus average returns. gas will performance the bring This maximize the the natural down marginally, And U.S. combined, in but inventory well does overall remain Lower

all the you the about questions On sure have Eagle I'm process. Ford,

and well, than new the report along to it's too results. news any no other morning this is for have early We very process moving

We've we'll and report been the when results very the in available. assets of the breadth in interest pleased

cash our to returns. Turning

in shareholders. quarter. lead quarter. $XXX And be total $X.XX to per to continues this Our yielded to industry third free model We flow share cash delivering the adjusted of returns the generated paid dividends in of this million

we Additionally, $X.X former million from XX% -- This former have $XXX purchased which of recently the brings on directly years of from buybacks creditors. from to shares creditors. billion, come

flow and Chesapeake billion to $X.X really stands returns that dividends, alone total free Our actual date, at returns. proud its cash year. including cash We're totaled to this meaningful directing buybacks

we During structure it our by of combine capital a outstanding with and the pleased with X/X still resulted this also diluted of lower that the share when our eliminating repurchase exchange. warrants, resulted able in able interest efforts, fully our also We're simplify count. our quarter, the reduction you in we're XX%. to to warrant were That short

balance continue Separately, work with in agencies recognition quality and sheet, upgraded we pleased us our month. to the we're rating to of BB this S&P investment-grade that

talk how for positioned to about to XXXX. So want up, we're wrap I

continue steady the of Our opportunities efficiency highlight and leading returns to remain and Marcellus gas best America. program capital very North all in will

added slides that our today, Haynesville lay out some In market we new posted the we slides strategy.

in capital flexibility capacity the arrive and to in due We LNG-ready our the of partnerships the be leadership Chesapeake participate expect to half our tailwinds to export significant the midstream as from growth macro decade. leverage demand to expansions increase second efficiency our

incremental grow to additions in available and demand. are message to meet We've our been consistent capacity

export things shareholder next to least We're approach truly ramp we superior returns, the best inventory capacity deep balance in means begin and attractive As to to differential as our about up doing positioned the focus capital flat a premier XXXX, places uniquely increase excited and begin we're sheet, all our be our setup with a what to sustainability. while over relatively XXXX. shareholders value slowly we're volumes several doesn't due as near-term at deliver on years to this setting for until

questions Andrew, we'll for now. open it up

[Operator The RBC Hanold with comes question Instructions] first Markets. Scott from Capital

some that? there. I constraints been there color and solutions, but more sense have a preparing like Because you timing got Obviously, all But And important couple a do this just provide seem Haynesville perspective, be constraints. on that are of going all are you an level LNG Can volume I and like Slide the quarters, it a in then confidence does little of had from of of you you've and it's to it couple to XX, looks from guess, the strategy? just the us guess, some, plan give to Haynesville, you a to different like going just forward. last bit we're there perspective and of --

capacity, here. to a quarters, about important. on We've Great contracting Scott. well we Yes. been super gathering bit may add and seen this both talking constraints. treating But for have and we've a It's in talk for as side number the side. the I'll that others been about in have question, as something active incremental of

pipe. We've also the with incremental now momentum contracted for takeaway

are to we need an see years. is opportunity do the we over in And really But for so what for don't next think the we grow few growth. any positioning near term,

probably exit is to have -- year-over-year up on setting an XXXX last growth be talked we'll exit a flat about as have rate. basis quarter, about to so And we but we'll

were about think integrating beginning the existed, the done what we you we last when to Haynesville, as constraints of year, of rigs. So some and in dropped that recognizing X the the buying assets we've

reduction lines first count and reduction There's the rig on show as can we've into begin That's quarter as like up see we're of as we for, that, of in additions to capacity move exactly that count result a that get map you lower well now as XXXX. that as rig do XX the up turn that fourth expected really and through lag contracted referenced, a XXXX. and all in into you effect on and seeing XXXX on the Slide in the in show quarter they

So our volumes we've we're capacity aligning been talking right in additions line to as about. with

then with in timed So of the pleased down see pretty very to first through we is our ticked the where setup. moving we'll well we activity and bit with dynamics we're the again, head, a we and year, exit supply-demand as build will all the exit volumes think longer-term this growth. an quarter And little think 'XX

And up. before another that, just guide you've which got downtick is for a so it. goes Got downtick your and XQ, is 'XX to it clarify post then

Just wanted that. to clarify

a 'XX a little yes. bit quarter be of downtick should from there, First of

Got Okay. it. it. Got

And Momentum and you you my would timing that for about, Can around dynamics number around CCS XX% the capital capital it pricing two, What talk all just the is commit the to One, things. sounds follow-up gas. participation. pipeline. Okay. to that that in? in on the of of discuss then kind then going a result that options, you couple you're And like

Sure.

terms isn't we in charging. look market of We will itself pay FT we basin, disclosed So if would are we'll the right can't in But ran it competitive determine ultimately pretty -- think is RFP to for selected and contract. disclose pipes the participate a to line this there which for at deliver the we a which [Gilles.] what pipe gas And pipe the the in one. this other for out you with so rate

it carbon helpful overall rate was felt as a the we capture gathering. contracted bit There to on a had market was So acreage also field. really vine on piece then pipe us attractive as gathering and Momentum the quite is of going build of for be the a couple the to well. that sections solution in delivery was yet as wellhead for well

The we've very to able carbon Gilles. rate we to downstream just carbon. point, COX it it that the the in with goes going this take market. done of the been entire be The then deliver is the attractive it will of afford you'll the built the But way will can delivery So Gilles that be have to this as the a so COX is scale, COX scale to that into contract that treated so and element be before longer won't to further tie all work inclusive in delivery out the well. at COX, gas you get will removal sequester removed than at And capture of to field. to

project. part to a be And think it's a So not it. done yet. innovative we of really it's excited We're

$XXX We us of attractive. the equity, intend the The around the participate over return of to again, estimate to quite participation. that But still be in couple equity course, we have to around a should the and the do documentation not finish on projection, million year period. would cost but do a it's probably known, investment to contracts And completely that. we

with The Goldman Choudhary comes Umang next question Sachs. from

expected. thoughts volatile year. if, -- I activity in environment outpacing winter price recently, next macro reduce your demand to you get supply so would gas -- to love and around Haynesville on winter have what been love weak concerns than would and And pricing there your more around weather are the thoughts is prices look the here, the levels will also, warmer price say, given

Great the lately. question, spent of been it has thing our prices at a as gas We is, We're really lot you and about lower. macro Umang. volatile great well, volatile, bit It profit. today has gas a And it's well, headed been makes still a bit The it's lower. been about headed been the talking talking attractive market about time suggest. certainly which company a

for And shareholders. we generate great cash flows

we're weather really well see move XXXX. going a market obviously here I the and supply the a certainly is prepared the prepared robust, that gas as prepared really being that think gas prices short based well. for -- in that go we're growing cold term, weaker and turn we does setup we're environment So our into we if of on very market tell across to price we weaker that back either we rely on today or for to you have gas for it as would well more demand

see if Haynesville And the predict activity And don't we'll happen it is reacts great real reduce term answer the to nearest what dynamics handful months that And depends it, Umang. the that if that. on we At how to One, on affect ready fast would just be price question. the a for actually things. but a there's can't no we that. know it does, will on depends and hard It in how of relative that, curve we curve. on the it depends

the what really like they drivers look are. So

for particularly as We really do supply-demand the for whole. Haynesville, U.S. remain super bullish but fundamentals, on the longer-term a the

should be to so to show very going and we come setup very even of still the timing export that growth to in close off efforts how best else labor there plenty by demand online. an challenged and supply/demand And that of when capacity are that, We the really markets will where at attention same and XXXX is estimations XXXX the will subscribed tight. all several research we the the that around environment could out chains timing There's does. as everybody precise uncertainty play know pay that up. and And are supply months

prepared very curve this if mid- fall a And we're kind throughout the to price So sustained to you to saw think Xs, a I prices market. down pull low price be or we'd the probably into bit. of fall responsive back a

we bit make it I certainly good we that here think Really, be level, we like evaluate reason give depends back a should not really we of that are want step because our a would indication come the point would probably think than allocation at it we at to we time. activity to but the is which it. facts But as capital still would an not that to at have looks us or money or down. on us that whether about what sit supply-demand hard fundamentals weaker exactly expect a today, whether predict and the that and where

That's next great. year. Clear. question And outlook on was my your for capital next spending

through spending your next talked next from laterals. shifting more any you're how of you about and longer impact And then completions you go across your that in program thinking your terms and as inflation year? budgeting early the any add on into to year? you benefits As Any read cost of those -- about enhanced process,

this Josh. Yes, is

be it's year, the XX% as think to next far I going inflation As range. to we're for goes XX% year-over-year, thinking in

talked about continue think been to X carrying flexible just we've We're in you in forward the about that program. a the so as adding Haynesville, which monitor process talking activity Nick Marcellus. if markets of the about, of with in that the kind And rig rigs we'll and seventh again, be

relatively the the a X-rig steady that Ford we're is activity then in program to And X- outlining. Eagle

pad, of going if to asked about the the at the Marcellus in also see looking the wells do links, we're go how kind from completions, we're standpoint. with increased not specifically, capital at year we Really, toe up we that that's lateral that. So enhanced is a shaping where additional development. only find maybe ahead address and and per one and adding looking things to the then is you of that's but And that be of I attempting advantages the we're there one

are fluid. fluid optimization and there The completion loading about that areas is benefit really less actually there we from think some

there's those are productivity look so we'll not increase the potential also cost capital things our at, which efficiency, And drives but that as to there only think reductions and well. enhances opportunities we

that So comment specific Marcellus. was to really

The with of Bank comes next Doug America. from Leggate question

the debate variable Nick, So erosion dividend. losing I'm clearly the on value

guess, be it those that, see terms Eagle the share you I continue your deploy that, and plug should question share the to wouldn't you a to of to indeed, whether have on given incremental use or think eventually sell that buybacks, I if proceeds, does sheet to So undervalued. I but to and when price proceeds balance how Ford, you do that what -- in we of acquisitions --

Doug. question, Great

So proceeds not we've we have flow. about these dividends about that proceeds model, the applying is through a return Eagle This the that talked return flow. We've would we with are operating model. from about said Ford cash operating really the cash that think

we not softer think as we little about us negative the the gas to company, have But has be of And we least especially been. for year when market it would that really importantly, at softer a there as as bit bit buybacks could more market lean a anticipate a a or recognize heavily here, for emphasis a here. I quite again, more. think, don't So as robust we XXXX just think to a requires we maybe little I because proceeds

pay down some debt will We with proceeds. the

that sure that asset make our as shape. sheet lot We EBITDA, great stays off will sell of we has in an make sure we balance a

to come plays a have how way that buyback. out reduce that balance magnitude for the the some impact answers best specific think through look shareholders proceeds at of return to we'll the come But the and a to and to Doug. So to then we to proceeds pursue is about you, when see capital of leverage and think exactly of in, have expect about what all proceeds sheet wait the in, right the it

your and capital. for higher perhaps Great. Thank answer. reported good the peers Thank perhaps, pointing of ask but but I one you. It's to a appreciate directional is guess to be night, enough inflation, color. you, than the predictable not consensus I Nick. follow-up expectations, hate last I peers my about right

your 'XX run seem You guys to yet, be cost of lot look really a -- given doesn't haven't seeing quarter rate a your but fourth pressure.

pressures. So upward cost

give XXXX if flat think X steer inflationary about. production core like So you that wonder just And you it capital profile impacts budget basis, what to leave could could there. us your I you look I'll in a as talked the in for

Yes, Josh. this is

back the course, first, activity quarter the we rate, in Ford. in the So Eagle of rigs burn see QX we pull some do fourth on because, some dropped

pulling that's And then the spend. Haynesville. Eagle see our quarter in we back lighter a also little So completion Ford bit

maybe little QX our we the what look preceding saw in different So than quarter. that's why burn a rate in will bit

pressures we I'll to about and Haynesville. of As in see inflation, the year-over-year again, kind reference XXXX most would we think expect inflationary the

are we be XX% And see so basin relatively nature. to we just bit expect be in this That stable think we In moderated. to Marcellus, tends year. to more a be stay potentially, assuming plus you're I that to flat there rig counts the going more looking little at where

the in be digits. really there mid-single inflation so the to And that anticipating we're is going

given in the did expectations our for foot guidance that's Yes, put Yes, XXXX per we of inflation. I'll for expectations the slides Haynesville for CapEx full yet. haven't Marcellus both today. We and inclusive dollar just our add that while

The question comes next Parham Zach from Morgan. JP with

on just question guess I follow-up there. another Doug's

to in that we include You 'XX XX% budget, with think on in that about XX% talked about if the in 'XX the and top any of XX% Momentum that the should this and project. the XX% spending -- of to also we does just the the rig associated Haynesville impact so, XX% inflation if context of seventh add

incremental we question Well, going maybe we've anything capital the we that layer of momentum expenditure in. -- course, 'XX, be that done think I on that's guess that to were anything an I specifically, in would need to

would you're come addition with up estimate. that if trying a be clear So XXXX to one

we've generally, But activity. on guided you

So the X account cost to for in And I Ford. continue opportunities. again, the the need at rig in look that the Haynesville. in rigs we've given we'll seventh some you then foot. per Marcellus, the guidance here again, X mean, rig X to other you to And Eagle range on

the to the presentation we in into in we just were picking if as as little of a in continue capital up look Marcellus. there's good that, more opportunities next acreage things One today that up bit the push highlighted for also We'll such could opportunities And that. heading such year. some successful as

on then Got operational just the it. side. one And

the both very think Upper average you performance that the while co-development. just step the upper Marcellus expect Can the I well still more you clearly what's well mentioned returns, productivity, lower? you have marginally down Marcellus and Nick would in versus the EUR Lower do as strong on come down in compare

XX-month but our in foot. deck is XX% to you stick provided a you And the on to ability longer estimate per over we do in what just basis. reduction in [indiscernible] foot I'll have upper. we've an drill what Maybe laterals the presentation, the per a is what you though, there of, remind I'll disclosed But see Yes. it's what on we just is

really to and be navigating laterals an some absolute And so there starts and just here And that why such basis, loss longer wells productivity drill on offset an we fewer of competitive can simply returns. because are wells drilling that, that's that well around. that we really, see opportunity to

wells something the think capital on that a with we which put today. I'll add can pad, that, that it the efficiencies, enhance which more is returns not here only the and addition in in specified can with that's In co-developing we necessarily additional just and to we've creates upper layered the explicitly further lower, deck

Rice. Meade next The comes from Charles Instructions] [Operator Johnson with question

your Good and morning, Nick, team. you

You hear me?

Yes, are Charles. How you?

that to slightly fine. versus upper I'm the on on lower. a up wanted I pick different in Maybe -- direction.

operator first works least it my the a you and to number comparing in put primarily function was your your changed wondering really that can helpful, time, But that's over out I'm Northeast you the guys think if about other the give upper I understanding I'm upper upper. bean and that history changes productive. over the that on you And us at if I geography? versus upper or really number XX% my in of that Just thickness lower the about I the But only curious, if kind was your XX% the of talk other of was less this is productivity, plane that, has And -- what slide. can recall a as talked baseline, number, more versus that PA. if one that like think, their XY time lower. little on outlook has

to dependent at one upon which productivity the maybe Well, maybe that be from will to the developed. is the the lower consider thing, you spacing upper lower decline that this the just is Josh, see was Charles,

to you on And will expect a number that some depletion and do encounter vary of things. so depletion,

spacing. We've to as developed our do the are developing how of your thickness, little at lower. wider was the you bit that limestone, the Obviously, bit of a unit some operators we lower And Valley to also been thickness little between but which the lower was they history, east could Cherry really asset, two overall the developed upper productivity. space developed, us the know stepped throughout into the a which a but the barrier the tighter they is lead there

bit why advantaged that's so have with a forward. a And little performance the maybe going we expectation upper

last more to may about it's rig think kind the for if talking I'm of were point? but I of right, commentary we last sense? Do then that an to it helpful, second seems eighth 'XX. Haynesville, is remains if the That And this like maybe right 'XX possibility the have -- more be call, possibility Nick. distant a understanding our the your you And or of maybe back Got -- Josh. possibility this on in quarterly it. Nick, at a shifting a possibility, half

I that do, to that to gathering I where make an mean, think would communicate call space you and takeaway just the we it And is option. we Charles. of capacity wanted we things midstream get I wanted think around capacity, the one a the treating that eighth we should I to sure place we rig. had want in

sit time, I'd half that more inventory incremental Haynesville to of eighth the looking certainly than an that's as justify decade. as of We demand we don't have into we and today, and us love not the second and over we that needed see as demand out export today, the us capacity met. really I'd great the acceleration at grows be being see XXXX. the rig to market get there Look, assets to But there's would anticipate love during is the LNG when

Now not go a rig if to and we is have then we'll But setup in can that great, now, to ready, the expecting needed, and turns do we're be out it we XXXX. to right eighth full it. add it

from with Benchmark. The next Subhasish question Chandra comes

there. want ratio I calibrate debt still on sort reduction of the keep the but Nick, proceeds Ford a I hypothetical, ask appreciate you to the to bit Eagle debt sale is

I a in very return accompany can that as might do be, piece considered have working it's if -- well? dividend capital if related you include healthy what don't number capital, Have Or and the the that secondly, guess a maybe sale. maybe Eagle too a of you hypothetical But debt calculation, that surplus that rough the give that sort really Ford the reduction you of to you debt sale? because you is You hypothetical. on can't special might of

Subhasish, is those Well, questions. for Thanks this Mohit.

intent I'll is -- play them. see the back intent of debt. the maybe very said is process the At and as a from level, first pay On get the let earlier. was what some the before, process go one, down proceeds sales to we to what said to Nick And high out kind

And the at into I would be. Overall, of very with happy that balance get the much this very, we point, say, sheet specifics how would is would that we the not are shape in.

the we materials, are X.X see can you debt-to-EBITDA saying is Net turns. from As

very selling it when a comfortable mirror property The overall the and we're that. are with EBITDA has the forma intent We behind is producing of pro level. to loss debt

will of On part time. that applies. of the special about we pay a at some your your So it, but different of come same will of logic point the second down question specifics a dividend,

once be recognize are bids in we'd think I path share the are then we once we happy more taking, that. to and which details around

Yes. Fair enough.

can a it more think gas that today. soft our growth until soft to the that stock One, earliest happen, don't prices see gas could prices we than even prices, just obvious just market gas connection, is at structural XXXX, fact about Subhasish, demand equity the talk we supply I gut for reaction. as would make we is lead Should that be mean weaker that as the would undervalued

is certainly transaction we this and dynamics would, mind of poised we be that demand our macro, believe receive in in at would So don't short the cash point, to which will, a stock, from to growth coming. nature falling bunch that if term due if with it's acquire we you

volatility obviously near lead of to and So that that volatility of prices, gas a we the volatility can we about like show term fact cash. the there's setup natural equities, thinking in in the lot of

versus be. on -- week could follow-up you your bid a A spot. place Yes. is good us That just about will to be remind

October, For fourth quarter, a bit I got guess already. November, weaken we

your locked is XQ of this much how at point? in So

Yes.

October November in. and well locked are pretty So

be of East month. expectations, first November of We to So but fronts see basics bit cold heavier the floating half there's week, supply month the our December. did we little through biggest on the plenty going a -- it's typically for there robust. Coast first at potential This for of when least the warmer We reports is lean give forecast and pretty early we is the the first piece and than the up -- in weather showing of do.

leaned harder we on a to the first amount bit little So month pricing of for November.

Excellent.

comes next Nicholas question with Seaport Pope The from Research.

a post share kind the I question on quarter had repurchases. of

want XXX I million the shares comment in think to October. repurchased you

Just kind that to it the math, you they shares. where like the looking dividend seems with at some probably the with are flows use those kind and debt cash repurchase of of

of of had there's creditor availability, kind I was that kind paid is that kind curious or curious everything be the in if big out some Just that a dividend So a of a December of because that block trade kind commented -- is? where that was of if on. timing going choice just kind versus -- of you repurchase it share the to was when about

Yes.

Mohit. So is Nick, this

in than we right, million as rest was You're perceived of We've to have call, sell XXXX down, our the they of emergence we until and helps our have trade well along to intent been share billion and we've said the schedule, the end been creditors, having earlier and are and buybacks more have buyback, we XX% And to of plan of with And former clear share then case these remove $X.X to about and the overhang one program. about provide the want buyback ahead buybacks $XXX a former the ability to the done was that be a the of still pleased overhang do at prosecute of done from the after all are it closed. billion $X very availability to quarter of of the able creditors. warrant is creditors ready that if bid. in

get Got or could going to you the it's is at that, say credit that quarter. than facility, And interest it. -- all average of X.X% Is in where look that you're on it obviously of that. the too. your commented appreciate of credit bankruptcy metrics the a then of -- of kind you to peers if like I coming as kind of third that? of would What's kind rate X% that looked kind timing facility where higher think something the in your debt even kind little add I that out you

what's a near term? credit timing facility facility traditional in kind next in to the So of kind and the go to -- of ability around more the the move the

Yes.

rate that -- depending facility. So the obviously carefully interest utilization goes to try of We would before also. a and of grid we and off refinance The question becomes credit referenced, it be credit pricing the conditions facility the much intent that the yes, it thanks you how we current. have for monitor that on

current next become it it So year. will matures

are current. of into So looking to facility it prior ways refinance becoming trying credit to the we

pretty so on shape conditions, feel we happens rates, And the a increasing the do what depending in in that in Fed company know. lenders, different But given macro obviously with is able the it being optimistic as you about timely our the is engagement manner. to

That's I had. all really

else everything think appreciate been time, I the I asked. has everyone.

Capital next question Johnston Phillips The comes from One. with

which like foot a What blended perspective? a XX, Slide Nick, you inflation year. locked of give are either higher front. the on that that And is that cost of Just from per guys can essentially pricing anticipating, referenced us factors move on next one could what maybe costs sense are percentage you of basis in helpful. up looks sort you a well more a or lower? number It can over $X,XXX little really move to Haynesville is the

Philip, this Josh. Yes. is

country is implication I cost for on shortages things we'll how need an our the it out. our see And proppant. we That monitor seeing think one much that the see across to as and costs affects is transportation right drilling some side, risk that has such the to that of plays continue to we're on them of that inflation now. diesel really

closely. So that obviously utilized services continue quite The for to that's monitor today. demand we'll being one high rigs, pumping with most that rigs high-spec remains

year, continue those So were push the that course obviously, of enable pricing. to demand remain that to through high may if to the providers on

and additional in specifically from and the look XXXX. second early but very providing a protection inflation some taking of third year it and been We've pricing the of suppliers where the active on parts little us in existing been in half higher we've and like working cost fourth with bit certainty our quarter today may the

think is good something a can preserve And that so it. that's how indicator of we we

I'm percentage, next locked you our bulk an that been a absolute drilling path today. primary really to the on side services as on the As in of for But not position far with in go have the being down frac year.

Okay. you I Great. investment company. not I control clearly it's metrics know the ultimately wanted financial something how and the appreciate ask have the also to achieving to just already. important that and can I color. that directly just potential of about grade you is timing

mainly function based a your limiting also, And the the important what's with management that investment-grade want just Board? path is to just overall how factor the to see? is So And on agencies, they scale? rating of the and conversations

Mohit. is Yes, to this grade is Investment important us. Philip,

you strategy in we grade extremely would that have start valuable scenario. being about thinking the in that As investment LNG play, be

actively already. referenced, and are we -- which record of as an element with showing is metrics X performance, clearly the We track rating There There's are engaged a are quality all demonstrating. credit you obviously seasoning agencies. investment-grade of

see So the is we of that last we kind the upgrade green time we we is confident on as conversation notches of away from are Thank seeing, that are a feel it's upgraded but you. seeing BB to remain confident get referenced, bit are And we getting there. and great. trajectory, just little couple shoots us S&P The we eventually. so of tone and of investment right that, there notch but that to of matter grade, that we'll we are that engagement a month, to of

Portillo with TPH. come will today question Matt last the from And

if potential some a cost cut Or I some I environment the on to the cost back difference that moving there necessary X between we got could shallower XX in 'XX, we apples Bossier. and co-development is basin. the and appreciate around about price you've a color as horizons question and little Slide assume the development? further But Just from into difference the a commodity forward? in consider 'XX, bit a that in might oranges the you between in head Haynesville Haynesville bit the a of be lower should Haynesville. the perspective the then targets talk Bossier on north the

bit there a general, little is and The is but does more us. for drilling lithology, challenging formation I it the more make a in it shallower, a Bossier a from just completion difficult rock type mean standpoint.

And so that's ultimately some what your differences. driving ends cost of up

as about this to down curve represents to limits we to the a continue to that. it part important simply think to pivot optimization long-term of continue relatively within develop. I asset. us the work what the it's Obviously, we think from for particular and but that's the a program, a learning see away At We interval think of point, of really just zone, we think it it that modest extend continue important don't would we

get do that one we through Bain. of that be some So just benefited still the They with in active the we there's think more a were we there's gained. to And interval. It's probably better. most opportunities to learnings efficiency lot think

year. that's hopefully so And a next about talking we're story

curious going opportunity or achieving the on just neutral my here momentum oil X Perfect. seen gas participants question second potentially obviously brings net as industry a And carbon marketing forward a unique premium. then and some TPS. about marketing, talk We've with pipeline

contracts, know talked gas marketing the Just small very of forward are to getting at curious you as see the opportunities working you more a uplift towards meaningful queue? premium you've bit I obviously But all do able we side. we on guys LNG a if then step in and pricing kind these projects a your the with your CCS gas with moment. to could about RSG the gas tie think

And in that my Matt, should great question question. that. there's mind that's a we no see

we early LNG are are in for of the Asia and is extremely Europe that think take gas in with buying. our bit time I it's it discussions they're that the of in a carbon seeing off-takers to they footprint interested going to evolve. What

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that's last I Well, this think morning. the had question right. we All

the So I for want to thank time. everybody

we reiterate, to the are we about extremely setup see. Just excited

execution to we our hard our and worked conditions have see portfolio position company, We that market today. this the for

know we And volatility certainly, gas heads be plenty structural think near second these this market supply that to We uniquely the there volatility take to are the regardless the of of we that in term. of see will decade. demand positioned conditions, in in advantage with and half natural for we then tailwinds where

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presentation. you concluded. Thank attending now today's has conference for The

disconnect. now may You