ConocoPhillips Q1 2023 Earnings Call Transcript

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Provided by Quartr
May 4, 2023

There are 17 speakers on the call.

Operator

Welcome to the First Quarter 2023 ConocoPhillips Earnings Conference Call. My name is Michelle, and I will be your operator for today's call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer during the question and answer session. I will now turn the call over to Phil Gresh, Vice President, Investor Relations.

Operator

Sir, you may begin.

Speaker 1

Call. Thank you, Michelle, and welcome to everyone to our Q1 2023 earnings conference call. Call. On the call today are several members of the ConocoPhillips leadership team, including Ryan Lance, Chairman and CEO Bill Bullock, Executive Vice President and Chief Financial Officer Dominic Macklin, Executive Vice President of Strategy, Sustainability and Technology Nick Olds, Executive Vice President of Lower forty 8 Andy O'Brien, Senior Vice President of Global Operations And Tim Leach, Advisory to the CEO. Ryan and Bill will kick off the call with opening remarks, after which the team will be available for your questions.

Speaker 1

A few quick reminders. 1st, along with today's release, we published supplemental financial materials and a slide presentation, call, which you can find on the Investor Relations website. 2nd, during this call, we will be making forward looking statements based on current expectations. Call. Actual results may differ due to factors noted in today's release and in our periodic SEC filings.

Speaker 1

Call. Finally, we will make reference to some non GAAP financial measures. Reconciliations to the nearest corresponding GAAP measure call. With that, I will turn the call over to Ryan.

Speaker 2

Call. Thanks, Phil, and thank you to everyone for joining our Q1 2023 earnings conference call. Since we just hosted our Analyst Investor Meeting in New York a few weeks ago. We are going to keep our prepared remarks fairly brief today. ConocoPhillips delivered a strong first quarter result, setting a new production record for the company as well as in the Lower 48.

Speaker 2

Underlying production growth was 4% year on year, including 8% year on year growth in the Lower forty eight. Call. We are confident in our outlook for the rest of the year, and we are increasing the midpoint of our full year production guidance. We're keeping our full year capital and operating guidance unchanged. Shifting to returns on enough capital.

Speaker 2

Call. We continue to demonstrate our returns focused value proposition in the Q1. Our return on capital employed once Again, exceeded our goal of being top quartile in the S and P 500. And as we highlighted at the recent analyst and investor meeting, we On return of capital, we are on track to deliver on our planned $11,000,000,000 for 2023, call. Which represents greater than 50% of our projected CFO and is highly competitive with peers.

Speaker 2

And we are able to achieve all of this while investing in our attractive mid- and long term opportunities. Our Q1 was also quite busy from a strategic perspective. At Port Arthur LNG, We acquired a 30 percent equity interest in the joint venture upon final investment decision on Phase 1. At Willow, we are pleased to receive a positive record of decision and begin road construction. And at APLNG, we We announced plans to become upstream operator following the closing of EIG's transaction with Origin and to purchase up to an additional 2.49% We also accelerated our 2,030 greenhouse gas emissions intensity reduction target to 50% to 60% versus a 2016 baseline as we further advance our net zero operational emissions ambition.

Speaker 2

I know everyone has the question on Sermon, so let me address that right now. We acknowledge that we received our right of first refusal notice, call. And we're certainly reviewing it carefully. Now in conclusion, as we shared at our Analyst and Investor Meeting last month, Our deep, durable and diversified asset base is well positioned to generate solid returns and cash flow for decades to come. Call.

Speaker 2

And as I said then, we challenge any other E and T company to show you a plan with this kind of duration. Call. Now let me turn the call over to Bill to cover our Q1 performance in more detail.

Speaker 3

Well, thanks, Ryan. Call. In the Q1 of 2023, we generated $2.38 per share in adjusted earnings. 1st quarter production was a record for the company at 1,792,000 barrels of oil equivalent per day, driven by solid execution across the entire portfolio. The Eagle Ford stabilizer expansion and Cut Truck S3 plant turnarounds were both successfully completed And Lower forty eight production was also a record averaging 1,036,000 barrels of oil equivalent a day, including 694,000 from the Permian, 227,000 from the Eagle Ford, 98,000 from the Bakken And Lower forty eight underlying production grew 8% year on year with new wells online and strong well performance relative to our expectations call.

Speaker 3

Now moving to cash flows. 1st quarter CFO was $5,700,000,000 excluding working capital call at an average WTI price of $76 per barrel. This included APLNG distributions of $764,000,000 Now, 1st quarter capital expenditures were $2,900,000,000 including $400,000,000 for Port Arthur Phase 1 $100,000,000 in Lower forty eight Acquisitions. Regarding Port Arthur, as you will recall from our Q4 call, We said we plan to spend about $1,100,000,000 in 2023. So, 1st quarter spending was fairly front end loaded relative to the full year.

Speaker 3

In the Q1, we also received $200,000,000 in disposition proceeds. And regarding capital allocation, We returned $3,200,000,000 back to shareholders and this was via $1,700,000,000 in share buybacks And $1,500,000,000 in ordinary dividends and vROC payments. Turning to guidance, We forecast 2nd quarter production to be in a range of 1.77000000 to 1.81000000 barrels of oil equivalent per day. This includes 10000 to 15,000 of planned seasonal turnarounds. We have also increased the midpoint of our full year production guidance by 10,000 barrels a day.

Speaker 3

Our new range is 1.78 to 1,800,000 barrels of oil equivalent, up from $1,700,000 to $1,800,000 previously. For APLNG, we expect distributions of 3 All other guidance items remain unchanged. So to wrap up, we had a strong Q1. Call. We remain confident in our outlook leading to our increase in full year production guidance and we expect to return $11,000,000,000 to our shareholders this year.

Speaker 3

Call. And we're well positioned to deliver on our commitments throughout this year. So that concludes our prepared remarks. And now I'll turn the call back over to Phil.

Speaker 1

Great. Thanks, Bill. So before we move to Q and A, just a quick reminder here that we are sticking to one question per caller this quarter Since we just hosted the Analyst Day a few weeks ago and it's obviously quite a busy earnings day for everybody. So with that, Michelle, let's move to the Q and A.

Operator

Please standby while we compile the Q and A roster. Call. The first question comes from Steven Richardson with Evercore. Your line is open.

Speaker 4

Call. Great. Thank you. Ryan, I was wondering if you could talk, I mean, on the return of capital. Obviously, outperforming 50% of cash flow from ops and setting up really strongly versus the $11,000,000,000 target.

Speaker 4

Just wondering if you could address the environment is not straightforward. There's a lot of volatility out there. And just from a shareholders perspective, how do you think about balancing, you know, vROC buyback And just the general flexibility as people consider kind of the volatility in the commodity environment.

Speaker 2

Yes. Thanks, Stephen. I think I'll start just by recognizing the volatility that's currently in the market. But even with that, as we look at the Q1 average prices, we're The mid-70s WTI quarter to date in the second quarter, they're in the high-70s. So that's close And after our planning framework that we set out early in the year that close enough to $80,000,000 in delivering the $22,000,000,000 in cash For the year, so we're not going to overreact to kind of what we're seeing in the volatility right now.

Speaker 2

So we're on track, and hopefully, you see that with The BROC that we set for the Q3 on track to deliver the $11,000,000,000 distributions that we set out at the beginning of the year, We're comfortable with that. We have the balance sheet to support it if prices turn out a little bit lower as well. It would take a structural change and we certainly don't view this volatility we're seeing right now as a structural change in the marketplace. In terms of the mix and the balance, We said we'd do about 50% shares. We leaned in a little bit in the Q1 on the shares.

Speaker 2

But through the year, we expect to be about fifty-fifty between Our VROC and the shares to deliver the $11,000,000,000 of returns back to the shareholder. Hopefully, you see that with the Q3 setting of the VROC at $0.60 a share. That should give you comfort that we're on track to deliver that.

Speaker 5

Thank you so much. Great.

Speaker 1

Thanks, Steve. Next question.

Operator

The next question comes from Neil Mehta with Goldman Sachs. Your line is open.

Speaker 6

Yes. Thank you so much and congrats on a really good Lower 48 quarter in particular. Brian, I think You sort of cut headed this question off, but I'd love you to comment to the extent you can on Surmont recognizing it's an active situation. And as you think about that asset, first of all, it seems from the Analyst Day that it is a core position for you guys and just Any thoughts on whether it makes sense to be a bigger part of the portfolio to the extent you can comment at all?

Speaker 2

Yes, Neil thanks. No, I can let Andy maybe make a few comments about the asset which would be kind of reiterating what we said at the Analyst Meeting. But Yes. We're in receipt of the notice on the transaction between Total and Suncor. We have a right On the Surmont asset, which we know really well because we own 50% and operate it.

Speaker 2

So we're in the process of Taking a pretty serious look at that. I can maybe have Andy reiterate some of our thoughts about the asset that we described in

Speaker 5

the analyst meeting. Good morning, Neil. Yes, as we said in the analyst meeting, we do like 7, it's a nice sort of long life, low capital intensity asset for us. As we covered in the analyst meeting, that low capital intensity is an important part of our portfolio. And just to sort of reiterate that, So the maintenance capital on Cermont, I'm referring now to our 50% share of Cermont.

Speaker 5

It's been in the $20,000,000 to $30,000,000 year range for the last 4 or 5 years. And you'll recall I mentioned that we're drilling our first new pad since 2016. That pad for example, it will be in the $40,000,000 to $50,000,000 So it's a very low capital intensity asset for us With that sort of basically flat production profile. And as you know, pretty much all of our other driver information we disclose in terms of production data, our bitumen realizations, our operating costs, that's all out there. So you can form your own view on the asset, but It's an asset that is a core asset in our portfolio.

Speaker 5

So probably just stop that.

Speaker 6

Great color. Thanks guys.

Speaker 1

Thank you, Neil. Next question?

Operator

Call. The next question comes from Roger Read with Wells Fargo. Your line is open.

Speaker 7

Yes, thanks. Good morning. I guess I'd like to follow-up on Port Arthur LNG. Obviously, the Phase 1 was covered. There's always possibility of greater expansion in LNG.

Speaker 7

Just what would be the Things we would watch coming up in terms of the second phase.

Speaker 3

Yes, sure, Roger. This is Bill. As we talked about at the Analyst Investor Meeting, we're currently really satisfied with 30% for Phase 1 and our 5,000,000 ton equity off take and we're prioritizing market development over any additional off take in equity right now. We really think we've got sufficient capital allocation to Port Arthur and we're looking for ways to optimize our current investments. So our plate is pretty full and we don't see need to allocate significant additional capital In the near term, and so there need to be some pretty unique reasons to make it attractive.

Speaker 7

All right. Clear enough. I'll stick to the one. Thanks.

Speaker 1

Thank you, Roger.

Operator

The next question comes from Doug Leggate with Bank of America. Your line is open.

Speaker 8

Hey, good morning guys. This is actually Clay on for Doug. So thanks for taking the question. My question is a follow-up on Sermonte. Our understanding is that Suncor could receive certain tax benefits as part of their deal.

Speaker 8

And I'm wondering if those tax benefits would be available to you If you exercise your right of first refusal. And I'm asking the question because I think yours would look more like an asset deal, while theirs is more of a corporate deal.

Speaker 2

Well, as we said, Clay, that we're currently reviewing the proposal That we got in the terms and the conditions. So it's a bit early to comment on tax pools.

Operator

The next question comes from Sam Margolin with Wolfe research. Your line is open.

Speaker 9

Hello. Thanks for taking the question. The capital efficiency Looks like it's going in the right direction with the production guidance and the capital plan in line. At the Analyst Day, You made some comments where you thought it was at least possible that you could start to see inflation ease, If not reverse. And the question is just as you think about this production results, is that An outcome of maybe an opportunity to press activity a little bit as costs are easing or is this a is it more of a well results driven outcome.

Speaker 9

Thank you.

Speaker 10

Thanks. It's Dominic here. Just to talk to inflation a little bit first. I think overall our capital inflation for the company, we still expect to be in the mid single digits year over year. So we certainly see that leveling off.

Speaker 10

As you mentioned before, We certainly seen deflationary trends in steel tubulars or price related commodities such as fuel and chemicals. Beyond that, On the rig frac and other services, they've certainly leveled off. We may be trending towards some reductions. We have seen rig counts Peak can begin to decline, that's led by the gas basins. So our teams are very focused on costs and they're working with our many service providers on that.

Speaker 10

We still expect around the mid single digits at this stage on inflation. Having said that, we certainly see capital efficiency coming through. I think that's really on an execution front. So we've had a strong start, particularly in the Lower 48. Our full year production guidance, as we've said, is up at the midpoint.

Speaker 10

We do expect low to mid single digits growth for the year and that's pretty consistent with the long term 4% to 5% CAGR we presented at our investor meeting And yet we're holding our capital range the same with $11,000,000,000 at the midpoint. So we're definitely seeing some execution efficiency. We're pleased about that. Nick, you may want to a little bit more about the Lower forty eight on that.

Speaker 1

So All right. Yes. Thanks, Tom. Yes, Sam, just take you back to the analyst call when we talked about drilling and completions efficiency. If you recall, we had from 2019 to 2022, we had a 50% improvement in drilling, 60% improvement in completion at stages per day.

Speaker 1

We continue to see that in Q1, very promising results. And that's the use of technology like simulfrac, e frac. We're testing out some remote frac as well where

Speaker 3

we keep a frac spread

Speaker 1

on pad 1 and then we had frac pad 2, pad 3, pad 4. So very promising results there. As well as on the drilling front, we continue to use data analytics and rig automation, but all it's coming together, so really promising. That did lead to some accelerated places on production of wells in Q1, Driving some of the over performance.

Speaker 9

Thank you so much.

Speaker 1

Thanks Sam. Next question.

Operator

The next question comes from John Royall with JPMorgan. Your line is open.

Speaker 2

Hi, thanks for taking my question. So my question is just on Willow. Are there any updates There to how the lawsuits are progressing and are you any closer to a resolution there and getting to FID than when we last saw you a few weeks ago with the

Speaker 5

Hey, John, this is Andy. Yes, there's really not too much new to comment on over the last few weeks. So the only incremental news we've had. It's all been positive. The 9th Circuit Court of Appeals denied motions attempting to stop our construction work.

Speaker 5

So we've been progressing with the winter season and we've had gravel extraction and road construction underway. It's It's pretty much going as we expected it would. So as you have in the last 2 or 3 weeks not much more to add than we talked about at the Investor Day.

Speaker 2

Thank you.

Speaker 1

Next question?

Operator

Call. Your line is open.

Speaker 11

Okay. Thanks. Ryan, maybe one for you Following up on the Analyst Day, but what impact if any does you increased your view of the mid cycle oil price from $50 to $60 What impact, if any, does that have on the way in which you think about the business? I mean, you're still focused on low cost of supply assets well below this price. Does the view that oil prices would be structurally higher over time have any impact on the way you think about managing the business over the long term, your balance sheet, allocation of capital Or anything

Speaker 2

else? No. Thanks, Ryan. In terms of how we're running the company day to day and the allocation of capital that we put in each year. It really doesn't we're only investing in things that have a cost of supply less than $40 WTI in the portfolio.

Speaker 2

So what a mid cycle price change. So our Chief Economist office, our commercial team, We go through a process every year where we take a current view of the macro and have a long range view of what we think is happening. And As we've gone through a lot of turmoil in the business, the Russian invasion of Ukraine, just the lack of investment going into the business these days, We stepped back and did our own bottoms up, which we do every year. But important this year, we did our own bottoms up work, try to understand where we think the mid cycle price is moving to and But it was staying at kind of that $50 level. Our assessment of the price required to generate that incremental barrel to meet that incremental demand, Our assessment put it at around $60 today.

Speaker 2

And so that there so the implications of that are really just How much cash flow we think we're going to be generating as we interrogate the portfolio, as we invest in the growth and development of the company And we put capital into the company. The way it manifests itself is just how much cash flow we can deliver at that kind of a mid cycle price, which is obviously a little bit more than We would deliver at the lower price. So it goes to sort of how we think about cash on the balance sheet, how we think about the debt that we're here carrying, how we think about distributions and how much capacity there is to distribute a bunch of our cash, which our commitment is above 30%. And when we get above mid cycle price, In our case like we are today, obviously, we're generating a lot more cash and we're returning a lot more cash to the shareholder now something In excess of 50% today. But that's driven by the low the reinvestment rate that we have in the company And our commitment to only invest in the lowest cost supply things we have in the portfolio.

Speaker 11

Okay. Thanks, Ryan.

Speaker 1

Thank you. Operator, next question.

Operator

The next question comes from Devin McDermott with Morgan Stanley. Your line is open.

Speaker 4

Hey, thanks for taking my question.

Speaker 1

So I wanted to go back to the Lower forty eight. It was helpful detail before

Speaker 4

on some of the efficiencies that you're seeing there. I think one of the other drivers of the strength in production that you called out in the prepared remarks was well performance beating your expectations.

Speaker 1

Can you talk a little

Speaker 6

bit more explicitly

Speaker 4

What you're seeing there and if there's any development changes that you've made driving that uplift?

Speaker 1

Yes, Devin, this is Nick. You're right. Strong well performance was definitely a contributing factor for Q1. If I take you back to the Q4 call, I had mentioned that our well performance was meeting or exceeding type curve expectations, and we continue to see that trend into Q1. So that's very encouraging.

Speaker 1

No overall development changes. We're just seeing very promising results across all assets. This is Just not the Permian, as well. And as I mentioned earlier, the completion and drilling efficiency has allowed us to accelerate some wells earlier in the Q1 and sourcing that production come into play. And then on the Eagle Ford stabilization plant that we've upgraded.

Speaker 1

The team just did a remarkable job in sheltering the amount of downtime In Q1, so we had less DT, but overall very strong quarter.

Speaker 6

Thank you.

Speaker 1

Next, Devin.

Operator

Question comes from Josh Silverstein with UBS. Your line is open.

Speaker 12

Hey, thanks guys. Just some questions around potential LNG opportunities in the future. You mentioned at the Analyst Day that you have options around Port Arthur Phase II, III and IV and even at Costa Azul as well. Can you just give some more details around the options? Does it need to be at the 30% like you did in Phase 1 of portal?

Speaker 12

Or could it be 10% or some other agreement there? Could it be before or after FID as well. And then just along the same lines, because there will already be some infrastructure in the ground for Phase 1, will the capital outlay for Phase 2 or 3 be less because of that? Thanks.

Speaker 3

Yes. So, yes, I think we laid this out pretty well at our analyst meeting. So for Port Arthur, we've got options On both equity and offtake for future phases, those can be executed either for equity, offtake or both as they present themselves through time. We also have some options on the West Coast of Mexico at Energy Coastal Azul on Phase 2. And so those are long dated options that we continue to look at.

Speaker 3

I talked a bit about Phase 2 Earlier in the call and so there's need to be some pretty unique opportunities on that as we think about that right now. Now as we think about future phases, we have structured our investment in Phase 1 such that we benefit from the economies of scale for future phases on our Phase 1 investment. So future phases actually benefit Phase 1.

Operator

The next question comes from Paul Cheng with Scotiabank. Your line is open. Call.

Speaker 13

Thank you. Good morning, gentlemen. Maybe this is for Nick. Nick, in the Investor Day, Yes, we eye for it looks like you are talking about 2023, the shale oil production of 1,000,000 barrels per day and in the Q1 you're already there. That means that for the rest of the year that The Lower 48 Shell Oil and Montney together will be pretty stressed or that number is somewhat conservative now?

Speaker 1

Yes, Paul. This is Nick. You're right. I mean, we had a very strong performance in Q1 as we just described. As you look at the future quarters of this year, we've got some larger pad projects, longer horizontal wells and kind of put that in context.

Speaker 1

We got 80% of our 2023 Permian wells are 2 miles or greater. And we got fairly large portion that are in the 3 miles. But you're going to see kind of small variations, but overall that's going to be relatively flat. But I'll leave you with this pause. Our plan will deliver at least mid single digits for Lower forty 8.

Operator

The next question comes from Scott Hanold with RBC Capital Markets. Your line is open.

Speaker 14

Hey, thanks. I just wonder if you could provide some updated If you have any on Venezuela, about a month ago there were some talks about kind of easing oil sanctions there and You all have a potential big asset or at least value that at one point in time we're looking to tract. Is there any update on that or is there any kind of color you can talk about like the progress and remind us of the value there?

Speaker 2

Yes. Scott, yes, we're right in the middle of all those conversations, as you might imagine, Including the most recent conversations around the Sitco refining assets, we're in the queue. We're in Right in the middle of anything that would happen there. We have a as a reminder, an ICC judgment of $2,000,000,000 We've collected about $700,000,000 on that judgment to date. So we have an outstanding, what they owe us on that particular judgment.

Speaker 2

We're in an appeal process with ICSID, which is the other tribunal and that's an $8,000,000,000 potential award coming. Now there's some overlap between the 2, so you can't necessarily add the 2 together, but I guess the point is they owe us a lot of money, and we're hard at Trying to get some resolution of that. And the recent news out of the judge and the U. S. Government around Citco is certainly helpful in that regard.

Speaker 2

It looks like despite the sanctions that are on the Venezuelans and on U. S. Companies We're doing work in Venezuela. There's a little bit of some light developing at the end of that tunnel and we're right in the middle of it all.

Speaker 14

All right. Good to hear. Thanks.

Speaker 1

Thanks, Scott.

Operator

The next question comes from Alastair Sam with Citi. Your line is now open.

Speaker 5

Hello, everybody. In your remarks at

Speaker 15

the beginning on the Lower 48, you mentioned about infrastructure build. And I was really just interested to try and understand across the Lower forty eight, but I guess especially in the Permian, what's the sort of ratio of capital It's going into infrastructure versus drilling. I guess there's changes over the life of the asset. So I'm just kind of intrigued at what's the point of asset life are we

Speaker 2

Yes. I'm not sure the exact ratio, maybe Dick might have some numbers, but I think most of what we're doing is large pad development with not single well facilities, but central facilities supporting those large pads. I don't know what the split between drilling and infrastructure spend is. I can let Nick, I have a comment, but I don't think it's much different than what we've been doing for the past few years.

Speaker 1

Yes, Alistair, it's very limited as far as on the infrastructure spend. Most of your expenditures is on drilling and completions in the Permian as example.

Speaker 15

Okay. Thank you very much.

Speaker 1

Thanks, Alastair.

Operator

The next question comes from Rafael Dubuet with Societe Generale. Your line is open.

Speaker 5

Hello. Thank you for taking my question. I just have one question about the working capital deterioration in 1Q. I was wondering if you could call. Tell us how much of it is due to some Norwegian cash tax catch up and what is it to expect

Speaker 1

for the rest of the year?

Speaker 3

Yes, sure. Happy to talk about working capital. So if you look at working capital for Q1. You can see that in the supplementary documents we put out on our website. Q1 was about a $100,000,000 use of working capital.

Speaker 3

For Q2, we'd expect that to be just over $1,000,000,000 And as you noted, that's associated with Norwegian tax payments, which is normal for operators in Norway. We accrued those in 2022. They're payable in the Q2 of 2023. And then looking for the rest of the year, assuming we don't see FX rates move materially for the remainder year, We wouldn't really expect any material working capital movements across Q3 or Q4. So hope that helps for kind of full year view.

Operator

The next question comes from Neal Dingmann with Truist Securities. Your line is open.

Speaker 6

Morning. All my question is on shareholder return plan specifically. What do you all view sort of in broad terms as an optimal quarterly payout given I guess now how even more volatile the commodity market continues to be and looking at your most recent, I guess the payout was a bit over 100%.

Speaker 2

Yes. Well, I think, Neil, you have to kind of go back to how we set the VROC in the Q1. That was actually set In the Q3 of last year in a $100 price environment. So we probably had a ratable a little bit higher distribution in the Q1 and then it gets more ratable as we go through second, third and fourth quarters as we deliver the $11,000,000,000 that we've targeted for this year, and that's evidenced by how we set the vROC for the Q3 at $0.60 a share.

Speaker 13

Thank you.

Speaker 1

Thank you, Neil.

Operator

Our last question comes from Leo Mariana with ROTH MKM. Your line is open.

Speaker 13

Obviously, Strong results out of COP today.

Speaker 16

I think you enumerated a couple of reasons for the Q1 production beat. It sounds like some wells came on early and well results Continue to be very strong, but just wanted to dive in a little bit on the maintenance side. I know you guys kind of talked about 35,000 BOE per day of maintenance In the quarter, did actually come to fruition, maybe that number was a little bit different? And then can you talk about maintenance for the rest call. For the year, I see you had 10000 to 15,000 expected in 2Q, but any expectations for 3Q or 4Q?

Speaker 10

Yes, thanks. It's Dominic here. So you're right, we did anticipate about 35,000 barrels a day of turnaround and maintenance impact in the Q1 that actually came in at 25,000, so 10,000 lower. That was partly because of the efficiency that Nick talked about at the Lower forty eight. The Eagle Ford Sugarloaf stabilized expansion went really well and the team did a great job sheltering some of that.

Speaker 10

Then there was a little bit of timing there around Qatar turnarounds as well. So We had 25,000 barrels a day impact in the Q1. We still expect a full year average impact from our tenderizer of about 15,000 barrels a day equivalent. Bill said, 2nd quarter, I think as you mentioned, expect to be 10 to 15. And there will also be some standard sort of seasonal downtime in the second and third quarter we typically see in Norway and Alaska and APLNG, but All of that's reflected in our new guidance, 1,780,000 to 1,800,000 barrels a day for the full year.

Speaker 5

Okay. Thank you.

Speaker 1

Thanks, Leah. We have Thank you, everyone, for being here today. We appreciate

Operator

it. Thank you, ladies and gentlemen. This concludes today's conference. Thank you for participating. Call.

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