Chesapeake Energy Q4 2024 Earnings Report

Chesapeake Energy EPS Results

• Actual EPS: $0.55
• Consensus EPS: $0.53
• Beat/Miss: Beat by +$0.02
• One Year Ago EPS: N/A

Chesapeake Energy Revenue Results

• Actual Revenue: $2.00 billion
• Expected Revenue: $1.82 billion
• Beat/Miss: Beat by +$180.94 million
• YoY Revenue Growth: N/A

Chesapeake Energy Announcement Details

• Quarter: Q4 2024
• Date: 2/26/2025
• Time: After Market Closes
• Conference Call Date: Thursday, February 27, 2025
• Conference Call Time: 9:00AM ET

Expand Energy Corporation is an independent natural gas producer principally in the United States. Expand Energy Corporation, formerly known as Chesapeake Energy (NASDAQ:EXE), is based in OKLAHOMA CITY.

Chesapeake Energy Q4 2024 Earnings Call Transcript

Presentation

[Operator]

Please note this event is being recorded. I would now like to turn the conference over to Chris Ayer, Vice President of Investor Relations and Special Projects. Please go ahead.

[Chris Ayres, VP – Investor Relations & Special Projects at Expand Energy]

Thank you, Lisa. Good morning, everyone, and thank you for joining our call today to discuss Xpand's twenty twenty four fourth quarter and full year financial and operating results. Hopefully, you've had a chance to review our press release and the updated investor presentation we posted to our website yesterday. During this morning's call, we will be making forward looking statements, which consist of statements that cannot be confirmed by reference to existing information, including statements regarding our beliefs, goals, expectations, forecasts, projections and future performance and the assumptions underlying such statements. Please also note there are a number of factors that will cause actual results to materially differ from our forward looking statements, including factors identified and discussed in our press release yesterday and other SEC filings.

[Chris Ayres, VP – Investor Relations & Special Projects at Expand Energy]

Please also recognize that as except or required by law, we undertake no duty to update any forward looking statements and you should not place undue reliance on such statements. We may also refer to some non GAAP measures, which will help facilitate comparisons across periods and with peers. For any non GAAP measure, there's a reconciliation on our website. With me on the call today are Nick D'Alaso, Mohit Singh, Josh Vietz and Dan Turco, our new EVP of Marketing and Commercial. Nick will give a brief overview of our results, and then we will open up the teleconference to Q and A.

[Chris Ayres, VP – Investor Relations & Special Projects at Expand Energy]

So with that, thank you again and I will now turn the teleconference over to Nick.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Good morning and thank you for joining our call today. The world's need for energy continues to grow. With our attractive market connected portfolio, resilient financial foundation and peer leading returns, Xpand Energy was created specifically to better respond to this growing demand and yield stronger returns for shareholders in times of volatility. Our productive capacity strategy uniquely positions us to not simply react, but to capitalize on the dynamic market we see today. As our 2025 capital and operating plan demonstrates, this is exactly what we are doing.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Benefiting from a powerful combination of premium rock returns and runway across our portfolio, access to advantaged markets and some of the most capital efficient operations in the industry, we've enhanced our outlook for 2025. We continue to benefit from the tailwind of our 2024 productive capacity strategy and now expect to produce approximately 7.1 Bcf per day for a capital investment of approximately $2,700,000,000 As market fundamentals continue to improve the outlook for natural gas, we are electing to invest an incremental $300,000,000 to build approximately 300,000,000 cubic feet per day of additional productive capacity. This will allow us to efficiently deliver 7.5 Bcf per day in 2026 should market conditions warrant. We believe this level of production optimizes free cash flow at mid cycle prices. Since we won't pull the trigger on this incremental capacity until mid year, we have time to watch the market and will have the flexibility to adjust as necessary.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Successful integration has further strengthened our outlook. We continue to capture significant capital and operating efficiencies rapidly accelerating the achievement of our annual synergies. We now expect to achieve approximately $400,000,000 of our annual synergy target in 2025 and to capture the entire $500,000,000 target by year end 2026. I am especially encouraged to see the 20% plus improvement we are delivering in our Haynesville drilling performance. In the fourth quarter alone, we cut nearly nine days and $1,500,000 in cost per well from Southwestern's legacy drilling performance.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

The definition of synergy success is clear, achieving capital and operating efficiencies that result in spending less while producing more, which is exactly what we're doing. Our resilient financial foundation and peer leading returns program are two areas which also further differentiate our company. At today's prices, we expect to end 2025 with less than $4,500,000,000 in net debt. Our debut $750,000,000 investment grade issuance set a record spread for an Energy Rising Star at 132 basis points over ten year treasuries and cleared all near term maturities through 2029. Our enhanced capital return framework is designed to efficiently return cash to shareholders and reduce net debt.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

After paying our $2.3 per share dividend, we expect to allocate $500,000,000 to debt reduction in 2025. Given our strong free cash flow outlook, we expect to have additional cash available to allocate to a combination of variable dividends, share repurchases and the balance sheet. Turning to our marketing program, we see great opportunity to capitalize on our position as the nation's largest natural gas producer. There is greater than 11 Bcf per day of LNG capacity under construction and the domestic power market continues to grow in support of data centers and rising consumer demand. We have the assets, balance sheet and capital efficient operations to help meet this new demand.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

I'm pleased to welcome Dan Turco to our team to lead this effort. Dan has extensive experience creating value for marketing and trading programs and will help us realize the benefit of our advantage position. The marketing program has already seen the value of our combined portfolio. Our team worked extremely hard from the date of close to fully integrate our marketing and transportation portfolio by January one of this year, allowing us to optimize the flow of volumes across pipes, increasing value for our gas and reducing costs. Looking forward to 2026, once the NG3 pipe is online, approximately 75% of our marketed volumes are expected to reach strategic markets, including 2.5 Bcf per day directly to the growing LNG corridor.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Expand's powerful combination of an attractive connected portfolio, a peer leading returns program and resilient financial foundation is distinct among natural gas producers. Today's market provides a unique opportunity for our company and we look forward to expanding opportunity for our shareholders in the year ahead. Operator, we'll now take questions.

[Operator]

Thank you. Our first question will come from the line of Matt Portillo of TPH. Your line is open.

[Matthew Portillo, Partner & Head of Research at TPH&Co]

Good morning, Nick and team.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Hey, Matt.

[Matthew Portillo, Partner & Head of Research at TPH&Co]

Just a quick question. Slide nine, very helpful laying out your thoughts on maximizing free cash flow at mid cycle pricing. Just curious maybe if you could speak to that slide and specifically if we're in kind of a $3.5 to $4 world, should we be thinking about kind of your productive capacity once you get to the 7.5 Bcf a day in 2026 to hold around 7.5 Bs or do you think you could continue to see growth from that point forward?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes. I'm really glad you asked about this slide to start off with, Matt. This is an important way for us to communicate how we think about our capital allocation for this year and over time. We all talk a lot about the right way to set up our business and we thought this slide did a good job of laying out our thought process. We believe that it starts with a view of the macro.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And so we'll continue to have a view of the fundamentals and let that underpin how we think about allocating our capital. And for us that means that we're going to always have a rolling forward two to three year assessment of where the market is and what that means for mid cycle prices. And you're right to point out that right now we're pegging that at $3.5 to $4 per Mcf Henry Hub. And so the table below simply lays out a look at the heat map is designed around cash flow generation, free cash flow and looking at various levels of production relative to various levels of price where is your business optimized. It's pretty easy for any of us to think about in a stronger market growing volumes.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

That always feels good. But there's certainly an optimal level of production for a business given the underlying macro. And I think this helps to highlight how we view that. There can be levels of production that are too high for a given price and there can be levels of production that are too low. And so at 3.5 to four point zero you can see that we sit in a pretty good place at 7.5 a day.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

What we also like about this slide is that we're giving you some parameters around which we would have to underwrite a longer term view of the macro in order to raise that level of targeted production. And I say targeted and we say mid cycle and all of those things because there's plenty of volatility that could show up in the short term that would continue to cause us to do things like we did in twenty twenty four curtail volumes, curtail activity. There might be times where you want to accelerate capacity that's otherwise on the sideline given a short term event. But when we think about mid cycle activity we think about this level of production relative to this price that we're underwriting. So right now $3.5 to $4 7 point 5 0 dollars Bcf a day of production.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

I think it's pretty interesting to note that from an overall market standpoint we are underwriting a level of price that is below where the 25 and 20 6 strip is today. We do that with the recognition that one, we don't mind being just a bit on the conservative side in underwriting price. Two, we do think a lot about how this will evolve over time and we know that when prices as they are today are above the marginal breakevens of the industry supply will ultimately show up and compete. And that competing supply as we go out into '27, '20 '8, '20 '9 is increasingly going to be not just domestic supply but international supply. We've talked for a while about how in the second half of this decade there will be more LNG capacity that comes online around the world that will compete directly with U.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

S. Gulf Coast capacity. And so we think it's appropriate to take this multi year view of the market. And again, we see $3.5 to $4 as a pretty reasonable price to underwrite. So all of that informs how we think about our business today, it what helps us to think about what the optimal level of production and CapEx is that then drives the optimal level of cash flow.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

I would also just point out that, we're giving you a lot of information on this slide including the right hand column of the matrix which tells you the amount of maintenance capital that would be required for each of these levels of production. Obviously, there's a lot of assumptions embedded into a chart like this and those assumptions would have to be revisited over time. We're using our current assumptions of well cost. We're using our current assumptions of well productivity. Our team is pretty focused on improving our capital efficiency around both halves of that equation every day.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And so we'll continue to refresh our thoughts around this. But we think this is a pretty good framework.

[Matthew Portillo, Partner & Head of Research at TPH&Co]

Perfect. And then maybe just a follow-up, you mentioned LNG. I was just curious if you can maybe touch on your updated thoughts on the marketing strategy.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

I know it's a diversification for you all. And there's obviously some

[Matthew Portillo, Partner & Head of Research at TPH&Co]

puts and takes and views. Incremental supply versus demand over the next few years. So just curious how you guys are thinking about the LNG market and your strategy moving forward?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes. Another great question. So again, we're excited about what's happening with the incremental LNG export capacity on the Gulf Coast and how we're positioned relative to that. We think we are uniquely positioned to that. One, just given the scale of production that we have proximate to those assets in the Haynesville.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

But then also we have a really nice transportation portfolio that allows us to move 2.5 Bcf a day by the end of this year to Gilles. We move another two Bcf a day over towards Perryville, which then can flow south towards the eastern facilities like Plaquemines. And we have a lot of connectivity to these projects. We have a great relationship with a lot of the liquefiers themselves as well as the off takers and we have regular communication with all of them about what their needs are and how we should think about being prepared to supply gas. So we really like our position.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

As you know, we have announced one supply agreement going through the Delfin facility. And we think there's more that we can do around LNG in the future. But I would say, we're really focused on ensuring that as we take on any incremental LNG projects, we're thinking hard about how we can do a couple of things. One ensure that it provides a diversified revenue source for us connecting us to markets that we wouldn't otherwise be connected to that have diverse and different characteristics than Henry Hub. We think that's important.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And then exposing us to revenue opportunities that again help to generate higher levels of cash flow through cycles for our business. I think as we think about our business today, we are in the Haynesville which is a really important geographic diversity for us being proximate to markets and being able to grow and we need to show higher revenue to prove out the value of that geographic diversification.

[Matthew Portillo, Partner & Head of Research at TPH&Co]

Thank you.

[Operator]

Thank you. One moment for the next question. And our next question will be coming from the line of Doug Leggate of Wolfe Research. Your line is open.

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

Hi, good morning, everyone. Thanks for taking my questions. Nick, I've got two, if I may. I guess the synergy number, we're all kind of watching that evolve a little quicker than you'd originally planned. But if I go back to when you announced the deal back in January of last year, you'd put a kind of a two year timeline on building a marketing business and you obviously made a very high profile hire here recently.

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

So I just wonder if you could give us a quick refresh on what you think the timing looks like now to achieve what you think is possible and maybe quantify what that number looks like? Again, 2.5 Tcf a year more or less. What's the is that a $0.1 number? Is that a $0.2 number? What's the ambition?

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

Because Obviously, I don't think asking a lot of people's numbers at this point. That's my first one. I've got a quick follow-up, please.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Thanks, Doug. We're really excited about what is in front of us from a marketing perspective. And you're right, we have made a really important hire for our team. And we're looking forward to building out our business in a way that takes better advantage of the scale of production that we have as well as the transportation portfolio we have today. Traditionally, both Chesapeake and Southwestern marketed gas in a relatively close to wellhead fashion.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

We do have a lot of transportation, but we are for the most part selling gas to the nearest purchaser at the terminus of that transportation whether that's off the gathering system or if it's further downstream. And we haven't engaged in a lot of optimization which generally larger companies do. We think there's quite a bit of value in the domestic optimization of how we sell our gas. And we're looking forward to building out the processes and the capabilities to do that. We know how to do it.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

We have the talent to do it. We need to build systems processes and certainly need to build a risk framework to ensure that we do it properly. But in doing that, we think we can add pretty meaningful value to our business and increase our netbacks to our equity production certainly by a few pennies on that domestic optimization alone. And then the longer term value opportunity is of course around new commercial relationships that could be more interesting. And those could be in the form of power deals, industrial deals, LNG deals, long term buyers of gas that seek certainty of supply and potentially seek some certainty of cost.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And we think there's quite a bit of opportunity in a market that looks like it will increasingly have challenges of getting the right amount of gas to the right markets at the right time. And we think we're well positioned to help solve those challenges.

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

So just to be clear, is that a $400,000,000 annual business or is that stretching

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

the deal more than the terms

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

of the marketing model?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes.

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

Well, I'm thinking $0.15

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes. I think we're going to hold on to giving you an exact number today, Doug. We're going to continue to build out this business plan. We're going to hold off on giving you exact number today, but we think it's certainly meaningful and we're pretty excited about what's in front of us.

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

Okay. Got it. So my follow-up is you've kind of subtly slipped into the presentation twenty years plus of inventory. And I think you used to have the Southwestern and the Chesapeake standalone saying we've got a fifteen year backlog. I think when you think about we're telling you, you can hold this at $3,000,000,000 of capital, 7.5 Bcf a day.

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

It seems you're making life pretty simple for everybody to kind of lay out what the value proposition is. My question is, what co mingling Bossier, Haynesville, Upperlower Marcellus, what's extending the inventory? What is the relative economics look like of the portfolio today versus what you were saying before? And because I was always the impression that Bossier and Haynesville had very different returns, but now they're both part of the story. So if you could help us understand that a little bit, if that twenty years is apples for apples comparison, that'd be great.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes. Look, it's essentially the productive life around the assets that we generate today. So yes, Bozier is in there, Upper Marcellus is in there. And we continue to de risk all aspects of those plays that have less producing wells than maybe the more traditional Haynesville zone or the Lower Marcellus zone. Our team has done some really, really good work over the last couple of years to add value to all of those locations.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And every time we add value to those locations, more of those locations can turn green, so to speak, in our inventory counts and in our skyline charts. One of the things that's happening here though is that as we brought these two companies together, we think we are ultimately going to be most efficient and most effective and leaning on the capital efficiency of our business. We'll run less rigs than each company was running on a standalone basis. And so the life extends, the number of years of development extends partially just because of that. But we're definitely very focused on continuing to turn more and more sticks within our acreage green which allows us to add more adjacent acreage around our place.

[Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC]

Thanks a lot for the answers.

[Operator]

Thank you. One moment for the next question. And our next question will be coming from the line of Scott Hanul of RBC. Your line is open.

[Scott Hanold, Managing Director - Energy Research at RBC Capital Markets]

Yes. Hey, thanks. Good morning. Let's stick on that same topic, if we could. And specifically with the Upper Marcellus and Bossier, can you talk about how what percentage of that is in the activity over the next couple of years?

[Scott Hanold, Managing Director - Energy Research at RBC Capital Markets]

And just give us a sense of the relative economics of those zones comparatively? And are you seeing the ability to kind of what things are you seeing that can maybe improve those economics and you get closer to sort of the Haynesville slash Lower Marcellus?

[Josh Viets, Executive VP & COO at Expand Energy]

Yes. Hey, good morning, Scott. This is Josh. First on the split, we do provide a slide in the deck on Slide 35 that provides the breakdown for the number of hills. But you'll notice in the Haynesville, we are going to be slightly heavier weighted towards the Haynesville wells.

[Josh Viets, Executive VP & COO at Expand Energy]

So it's probably closer to 60% to 65%. And in the Northeast with the upper and lower, it's probably closer to maybe 45% lower and the rest will be upper. And so on the comparative economics, one of the things I would just say, I'll maybe start with the Haynesville specifically. Both reservoirs offer tremendous potential from a return stand point. And we like the productivity that we see in each.

[Josh Viets, Executive VP & COO at Expand Energy]

The Bossier tends to be just a little bit more expensive on the completion side, but also recognize it's shallower. So drilling costs are a little bit less. We find productivity to be fantastic across both, I would say somewhat equitable. The upper and the lower, we've talked about for some time the fact that we do see lower productivity on a per foot basis in the upper. But the ways we find to enhance the economics of that, which is really the ultimate goal is by extending lateral lengths.

[Josh Viets, Executive VP & COO at Expand Energy]

And because it's less developed, we have opportunities to drill longer laterals, which we've been doing year over year. We've also really been investing in analytics and looking opportunities to enhance the way at which we complete these wells. And so the combination, the longer laterals, the enhanced completion designs, we've talked about hybrid wells in the past as another mechanism at which we could really boost up the profitability of the upper wells where we combine, let's say, a 10,000 foot section of upper with 5,000 feet of lower reservoir. That all helps to normalize our returns across the Marcellus play.

[Scott Hanold, Managing Director - Energy Research at RBC Capital Markets]

Appreciate the context. Thanks. And as my follow-up, just talking about the productive capacity increase that you have planned into 2026. And to me, it was interesting on I guess, you're calling it productive capacity versus just regular growth. So that does correct if I'm wrong, indicate to us that there's some optionality if the market's not there.

[Scott Hanold, Managing Director - Energy Research at RBC Capital Markets]

But can you give us some sense of as you get into the back half of 2025, obviously, it's a very sensitive time coming into the winter every year with the gas market. If you start building this productive capacity and in these wells to bring on and let's say the winter doesn't pan out, what happens in 2026 now that you've already spent those $300,000,000 of extra capital? What do you do?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Sorry, my mute didn't come off. I'm going to start over. Yes, we're really pleased with the flexibility we exhibited in our business in 2024 and we think it would set up really similarly. So, we're going to build this productive capacity coming into the end of this year. It will be ready to be turned in line in 2026.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And if the market is not there, then it would we would likely have a response to that. That would be some combination of either holding back the turn in lines or curtailing volumes to alleviate pressure on the market. But I would back up even further than that and let's say that we see that as we come through this year, the macro conditions change in some unforeseen way and the market doesn't look as strong in 2026 or 2027, then we'll change our capital allocation as well. We've proven, I think several times over the flexibility we have there and the willingness to try and be responsive and in front of market conditions to be efficient with our capital relative to where we are in the cycle. So we maintain a ton of flexibility in our business and this is what we think is the right planning step for today.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And we're very prepared for both increasing capital or decreasing capital as conditions warrant.

[Scott Hanold, Managing Director - Energy Research at RBC Capital Markets]

Thank you for that.

[Operator]

Thank you. One moment for the next question. And our next question will be coming from the line of Kevin McDermott of Morgan Stanley. Your line is open.

[Devin Mcdermott, Executive Director at Morgan Stanley]

Hey, good morning. Thanks for taking my questions. So I wanted to dive in first on the 2025 activity in a little bit more detail. Definitely agree with the constructive outlook for gas prices this year. Looking back about a month ago, we were flirting with $2 on Henry Hub.

[Devin Mcdermott, Executive Director at Morgan Stanley]

So I was wondering if you could talk a bit more about the decision process to pull forward the deferred tills and then also give a little bit more color on the cadence of that productive capacity throughout this year. I know you have the 1Q guide and the full year number, but how are you thinking about the volume trajectory as we move through 2025 for the business?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes. Good questions, Devin. So we're again, I want to go back to talking about how we think about the macro and thinking about a two to three year look of underwriting a price range here and we've landed at 3.5 to 4.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

There's a lot that goes into that. And ultimately, you're thinking about the trajectory of supply and demand and all the features of the market that will impact supply and demand over the next couple of years. And so on the supply side, you're certainly thinking about how many rigs are running, how many wells are being completed, the productivity of those wells, how many pipes are coming online, including from associated gas areas like the Permian and building out a pretty good view of what the supply to the market looks like. On the demand side, we're going to pay a lot of attention to the trends of power generation and what fuels power generation growth is relying on, trends of industrial demand. And then certainly what we see now as the big driver is the increase in LNG export capacity, which requires a view not just of what that of the aggregate capacity, but also a view of the likely utilization of that capacity, which again we've talked about initially we think is going to be very, very high and then over the next few years would potentially begin to run at less than 100% capacity as more and more comes online.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

So all of that informs this longer term view. One of the things that you do pay attention to as a part of all of this analysis is where storage is. So we've had this constructive view on the longer term. And then as we got through this winter, you see that it's been very cold, of course, and storage has drawn down a good bit, which just accelerates the timing at which the market is seeking incremental supply, so that storage doesn't run too low. I think the multi year look hasn't really changed much for us and all that's changed is that the starting point at which the market is looking for more supply has come to us a little bit sooner as a result of there being a cold winter.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

We think it's really important to maintain this view that is multi year, multi season, so that we don't end up chasing a near term event of price in the market. And then again to make sure we have the flexibility in our business to continue to review those assumptions over time. I'll ask Josh to comment just on the trajectory of production this year and going into next because we gave a lot of thought about that as we have the flexibility with our deferred till strategy.

[Josh Viets, Executive VP & COO at Expand Energy]

Yes. Hey Devin, we absolutely started to see some strengthening fundamentals as we were exiting the year. And so we did start to bring online some of the deferred hills at the December. In fact, across the fourth quarter, we brought on about 40 wells and roughly 25 of those were technically deferred hills. And what you have to just remember in this is what we've been able to accomplish with just, let's just say, those 25 wells, those wells could have come online in a $2 gas price environment.

[Josh Viets, Executive VP & COO at Expand Energy]

But instead, we were able to bring them on to a very strong environment with roughly $4 gas. So we feel really good about that decision. And then as we come into the first quarter and again fundamentals remain strong, we talked about weather. We've seen relatively strong LNG feed gas pools as well, which again we think is helping to tighten storage. And so across the first quarter, we're anticipating bringing on roughly 90 wells into the markets.

[Josh Viets, Executive VP & COO at Expand Energy]

And just to give you a little bit of perspective on what that means from a trajectory standpoint, of course, we've guided to a six seventy five number for Q1. But we expect to grow from the December where our production was just over 6.4 Bcf a day. We expect to exit March around seven Bcf a day. And so when you talk about kind of short cycle market response of production, that's really what we've created here. And so with the deployment of our deferred hills, which we expect to be extinguished effectively by the first half of this year, we expect to be kind of up on plane between say seven and seven point one BCF a day heading into the second quarter.

[Josh Viets, Executive VP & COO at Expand Energy]

And we'd expect to maintain that type of production as we exit the year, which then of course positions us to be able to benefit from the productive capacity that will now build on this upcycle as we look to exit 2025.

[Devin Mcdermott, Executive Director at Morgan Stanley]

Got it. Thanks. That's really helpful. And my follow-up is on that productive capacity. Slide eight has the building blocks of capital and also some breakdown of where that incremental 300,000,000 of spending would go.

[Devin Mcdermott, Executive Director at Morgan Stanley]

And I think it's notable that it's actually split across Appalachia and the Haynesville. You have some going to each of your core assets. So I was wondering if you could just talk a bit more about how you think about allocating growth capital across the different assets in your portfolio. Maybe as part of that, can you just address the takeaway situation in Northeast Pennsylvania and how much room there actually is to boost volumes there?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

So we think about allocating capital across these assets just as you alluded to in your question. Our ability to grow is primarily in the Haynesville. In Appalachia, the capital that's coming in there is really in recognition of what the existing capacity is and bringing production up to those capacity levels. We know where we've been able to produce successfully in the past and we're not going to attempt to go beyond that. So the growth capital that you really see is more about the Haynesville.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

I just want to remind everybody that we do sit right adjacent to the LNG growth corridor and have 2.5 Bcf a day by the end of this year of capacity to deliver to Gillis. So as you think about where that LNG gas is going to come from, it's going to primarily be sourced from Gilles. We have the LEAP pipeline and the NG3 pipeline and in aggregate that's 2.5 Bcf a day that gets delivered right to the source of growing demand. And so the incremental volumes that we really think about here as we increase our volume profile into 2026 are focused on meeting that growing demand. This is not delivering volumes into a static environment.

[Devin Mcdermott, Executive Director at Morgan Stanley]

Makes sense. Thanks so much.

[Operator]

Thank you. One moment for the next question. And our next question will be coming from the line of Neil Mehta of GS. Your line is open.

[Neil Mehta, Head of Americas Natural Resources Equity Research at Goldman Sachs]

Hi, Neil Mehta here. Can you guys hear me okay?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes, sir.

[Neil Mehta, Head of Americas Natural Resources Equity Research at Goldman Sachs]

All right, Nick. So, hey, just wanted to spend some time just talking about return of capital and capital allocation and those three tranches that you outlined in the deck and your objectives here in 2025 as you transition from delevering to focusing potentially on shrinking your share count too?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Sure. We're pretty happy with the cash flow profile that's in front of us for the next couple of years. One, we've prioritized debt pay down and you can see that really clearly in that waterfall. We've put in place a $500,000,000 debt pay down goal for the year. That's on top of the fact that we retired the outstanding revolving credit facility that was Southwestern's at the close.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

We paid down $389,000,000 of bonds that were maturing in January. And then we've done another refinancing, of course, with our first investment grade issuance that allowed us to push out some maturity. So we have a really good runway in front of us to retire debt and a lot of cash flow to do it. So that $500,000,000 out of our free cash flow will flow towards debt pay down as well as we have a little bit of incremental proceeds from the Eagle Ford sales that will come to us in deferred proceeds in 2025 that will go towards debt pay down as well. So we're taking a pretty good swipe at the balance sheet.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

We're going to end the year with less than $4,500,000,000 of net debt based on the recent strip. So we feel pretty good about that. That will obviously be well under one times EBITDA with prices around where they are. I would also remind you that that $500,000,000 is a target that we'll set each year. So next year, we will have another debt pay down target.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And what we've attempted to do with this framework is allow for a good balance of ensuring that our balance sheet stays very, very strong. It's as you know with the history of our company and the way we've been able to bring assets into the portfolio that have been very accretive to our overall returns profile, we believe you need to have a very strong balance sheet to do that. So we're going to continue to have a really strong balance sheet. You need a strong balance sheet to allocate your capital efficiency and maintain the flexibility to allow production to decrease and increase as we've done over the last year. And that balance sheet strength is such an important part of how we think about our competitive position in the market that it will stay front of mind for us and be protected.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And then beyond that though, we're going to generate a lot of excess free cash flow and we think that that needs to be returned to shareholders in a pretty significant proportion. So that remaining tranche then we have the flexibility to return to shareholders seventy five percent of it either in the form of buybacks or variable dividends. We will use that flexibility to be thoughtful about the most efficient way to do that for shareholders. Over the last couple of years, you've seen us use both and I wouldn't be surprised if we continue to use both.

[Neil Mehta, Head of Americas Natural Resources Equity Research at Goldman Sachs]

Yes. Thanks Nick. And that's kind of brings us to the follow-up, which is you guys have done a great job of hedging the wedge or taking advantage of the constructive forward gas curve. Can you just talk about how you're thinking about the hedging strategy on a go forward? Does hedge to wedge still make sense?

[Neil Mehta, Head of Americas Natural Resources Equity Research at Goldman Sachs]

Have you gotten to an optimal level at this point? And just how you're thinking about that part of risk management?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes. Our hedging strategy, we feel like has worked really well for us. We had a really nice offset to the low prices last year that supported our cash flow. And despite the fact that gas averaged for the year about $2.26 we ended the year with a nearly neutral free cash flow position that's really largely supported by our hedges. In 2025, as prices have run quite a bit, our hedge losses are a fraction of what that gain was last year.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And that's a function of the fact that we've hedged, we think, on a rolling basis that has really made sense so that we have exposure to the right prices in the market that we're setting the appropriate floors. And we've been able to use a fair amount of collars as we approached the start of 2025. We like the approach. We like having roughly 50% to 60% of the first year hedged and then less in the second year and continuing to leg into those hedges over time. We also would acknowledge that in recent weeks as prices have been a lot stronger, we're not afraid to shift for near term prices more towards swaps.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

You're elevating the floor of your locked in price and you're also willing to move to the higher end of your ranges of targeted levels of hedges. We see prices in 2025 that like I noted a few minutes ago are well above the marginal breakevens in the industry. And when you see that, you want to hedge more and you want to go ahead and lock in those prices. So that's what we'll continue to do.

[Neil Mehta, Head of Americas Natural Resources Equity Research at Goldman Sachs]

Thanks Nick.

[Operator]

Thank you. One moment for the next question please. And our next question will be coming from the line of John Freeman of Raymond James. Your line is open.

[John Freeman, Managing Director at Raymond James Financial]

Good morning. Thanks. The first question I had just hi. Just following up on an earlier question, Josh, when you were kind of going over the accelerated pull forward on the deferred tills, just to sort of level set kind of the model since I know that the plan is that, as you said, all the tills basically get exhausted first half of the year. And then I believe the plan assumes about 85% of the DUCs get bought online this year as well.

[John Freeman, Managing Director at Raymond James Financial]

Where did the deferred tills and the DUCs stand at year end?

[Josh Viets, Executive VP & COO at Expand Energy]

Yes. So because we started bringing on wells in the back end of the quarter, which was about 25 of those deferred hills, that left us with about 55 to 60 deferred hills at year end and between fifty and sixty DUCs at year end. And just one comment I would make on the DUCs is that we have assumed a somewhat ratable activation of the DUCs across the year. And of course, there's a capital amount that comes along with that. One of the things we really like about the plan is just the retained flexibility that we have.

[Josh Viets, Executive VP & COO at Expand Energy]

And we have this option to actually accelerate the completion of the DUCs that creates more flexibility in the year from a production standpoint while holding capital flat. And so though we'll have activated all of our deferred hills, hills, we still feel like we've retained flexibility with the ducks throughout the calendar year.

[John Freeman, Managing Director at Raymond James Financial]

That's great. And my follow-up, when looking at that Slide nine, it would appear that going from kind of 7.5 Bs a day to call it eight plus Bs a day, it looks like just trying to back into what you all got for the CapEx that it doesn't look like there's like a material kind of increase that's needed on infrastructure spend? It looks like you all can handle that without any big step change on that front. Is that the right read on that?

[Josh Viets, Executive VP & COO at Expand Energy]

Yes, that is the right read. What you need to remember is just where both companies were operating prior to deal announcement at the end of twenty twenty three. And so we have adequate off take the infrastructure both in the field and with the transport is capable. And so effectively with what we're doing right now, we're restoring volumes. And then the productive capacity that we'll build will essentially continue down a path to get us to a spot where we're just more fully utilizing the infrastructure that we have access to.

[John Freeman, Managing Director at Raymond James Financial]

Got it. Thank you all.

[Operator]

Thank you. One moment for the next question. And our next question will be coming from the line of Paul Diamond of Citi. Your line is open. Paul, your line is open.

[Paul Diamond, Analyst at Citigroup]

Apologies, the line cut out there for a second. Morning, all thanks for taking the call. I just wanted to talk about Slide 15, you guys talked about having made some good progress on the drilling activity. I just wanted to inquire if there was any remaining opportunity there or the timing of such, like I guess how much meat is left in the bone there?

[Josh Viets, Executive VP & COO at Expand Energy]

Yes. We still feel like there's plenty of room to drive improvements. And this is the slide on Slide 15, of course, is focused on the Haynesville. And I would say that we've been incredibly pleased with the progress that the team has made. Through our diligence process with the transaction, we had pretty clear understanding of what the gap was in terms of days.

[Josh Viets, Executive VP & COO at Expand Energy]

And we utilized the time of our integration planning really to break that down into wealth segments. And we've used that time obviously effectively to allow us to realize more than a 20% improvement in our footage per day and 20% improvement in cost just in the first quarter. And so to your question, we're going to continue to improve in this. And talking to the teams, we know there's additional opportunities. I'm seeing that even just flowing into the first quarter.

[Josh Viets, Executive VP & COO at Expand Energy]

So we feel really good about the trajectory that we're on. And then the thing that I would also just mention, again, we focused this in on the Haynesville for this discussion, but we just drilled a 5.5 mile lateral up in West Virginia and we did so with a single bit run-in just over five days. And that type of progress that we see in an asset, that clearly has an opportunity to kind of lend itself into the other areas that ultimately translates into incremental synergies. So we definitely think there's meat on the bone and really, really excited about what we have in front of us.

[Paul Diamond, Analyst at Citigroup]

Understood. And just one quick follow-up. Thinking about the rig adds in second half, should we think about the timing and cadence or is that purely reactive or is there a plan for July 1 and then October 1? Just kind of how to think about the timing there?

[Josh Viets, Executive VP & COO at Expand Energy]

Yes, Paul. I'll lay that out for you. The re adds are premised across the second half of the year. What we're looking at right now is that we'd add a couple of rigs in the third quarter. Those would be destined for the Haynesville and Northeast App.

[Josh Viets, Executive VP & COO at Expand Energy]

And then in the fourth quarter, we would expect to add a rig in Southwest App and then the ninth rig in the Haynesville.

[Paul Diamond, Analyst at Citigroup]

Understood. I appreciate the clarity. I'll leave it there.

[Operator]

Thank you. One moment for the next question. And the next question will be coming from the line of Charles Meade of Johnson Rice. Your line is open.

[Charles Meade, Research Analyst at Johnson Rice & Company L.L.C.]

Good morning, Nick, to you and Josh and the rest of the Xpantan team there.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Hey, Charles.

[Charles Meade, Research Analyst at Johnson Rice & Company L.L.C.]

Nick, I wanted to ask a question about page 10, really this graph on the left side of the page. My first reaction I see is it reminds me of my son's high school trigonometry homework. It makes me think maybe whoever came up with this slide is looking at something similar recently. But I think what this is, is this is the this is trying to describe the dynamics around the baseline kind of scenario that you outlined on Page nine. And if that's the right interpretation, I look at this and I think the message that you're trying to send is that you will be increasing CapEx when you're under producing, presumably when prices are low and that you'll be maximizing CapEx and starting to draw down when prices are higher.

[Charles Meade, Research Analyst at Johnson Rice & Company L.L.C.]

But I wonder if you could guide our interpretation of that this dynamic that you've laid out here.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Yes. You're talking about our attempt to be countercyclical. And generally, I would agree with you. I would say that it's not going to be quite as simple as you just described. But generally, this is a look at how we would attempt to be responsive to market conditions in a way that is faster than the cycles of capital will typically allow you to be in this industry.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

If we go put capital to work in this industry today, it takes us a couple of years to bring production online and then earn a return on that production from the point of which you make the decision until the time at which you have the return of capital in the bank from that decision. It's a couple of years. So what you really want is a business that's much more flexible in a market that has conditions that change much faster than that cycle of capital. And this is really meant to describe how we would achieve that. We are very willing to allow production to fall in the near term.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And then as you bring production back to move above a targeted midpoint, when prices are there to support that. And so what you should think about is, you accelerate and decelerate capital if you want to move that middle dash line, but you move above and below that dash line based on the near term conditions in the market.

[Charles Meade, Research Analyst at Johnson Rice & Company L.L.C.]

That is helpful, Nick. That adds to my understanding. And then one other thing, Nick, as a follow-up, twice now I think you've mentioned marginal breakeven for the industry. Can you share what you think that is and where expand sits vis a vis the industry on that marginal breakeven?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Sure. I mean, I think we can all calculate like a specific number in a supply model on what marginal breakeven is. Of course, everybody's going to look at it a little bit differently. So we think that number is I'm going to just call it loosely in the mid-3s. And so we think we sit probably on the lower end of that as a business because we have a huge amount of inventory at very, very low cost in the Marcellus and then we have a lower cost inventory in the Haynesville than some of our peers.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Lower cost because we still have a lot of development in the core of the Haynesville and also because we have the best capital efficiency in the Haynesville and we have a slide in the deck that details that. So we think we sit in a really attractive position relative to the industry's marginal breakeven. And that's super important because if you're going to be a company that responds to supply and demand signals, you really need to know where you sit. And if you're at the tail end of that marginal breakeven, you shouldn't be the first company to respond. We don't think that's where we are.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

We are most proximate to the growing demand. And in that area of proximity, we have the most capital efficient assets. And so we really like our competitive position.

[Charles Meade, Research Analyst at Johnson Rice & Company L.L.C.]

Thanks Nick.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Thanks Charles.

[Operator]

Thank you. One moment for the next question please. And our next question will be coming from the line of Zach Parram of JPMorgan. Your line is open.

[Zach Parham, Executive Director, Equity Research at JP Morgan]

Thanks for taking my questions. First, Josh, you mentioned some meat on the bone left on driving D and C costs lower. Have you built any of those incremental D and C declines into the CapEx budget? I mean, you all been consistently coming in at the low end or below on CapEx over the last several quarters. So just trying to get a sense on if that trend could be set to continue?

[Josh Viets, Executive VP & COO at Expand Energy]

Yes. So what I would say is that for the $400,000,000 of synergy that does account for additional improvements. But I do believe and I have an expectation that we continue to find opportunities to enhance efficiencies through the year. And if realized, will create upside to the capital needed to execute our 2025 program.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Hey, Zach, one thing I would add to that is just as we think about our synergies over time and this goes back to a little bit of a question that Doug was asking at the beginning of the call. We've identified $500,000,000 in synergies that we think are very clearly tied to this merger. Now ongoing, one of the reasons you put together businesses like this and the reasons you're excited about it are that there's increasing opportunities each and every day to improve upon your business. So where we see the line between synergies that are directly tied to the merging of the two entities versus ongoing improvements in our business will become more and more gray every day post close. So we're going to be really accountable for this first five hundred million dollars and then we're just going to continue to improve our business every day.

[Zach Parham, Executive Director, Equity Research at JP Morgan]

Thanks. That's helpful color. And then just wanted to follow-up on a couple of the earlier questions. So you've currently talked about anchoring to that 7.5 Bcf a day level in 2026, which in the slide in the deck that's based on a mid cycle price of $3.5 and then the strips above that level over the next couple of years. Do you see any scenarios where you would move production higher from that 7.5 Bcf a day level in 2026?

[Zach Parham, Executive Director, Equity Research at JP Morgan]

Just trying to get a sense of how flexible you could be there both going higher and lower.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

You certainly could go higher, Zach. I think it would take underwriting a price above $4 If you look at that heat map chart, you can see that for us to be comfortable targeting a price above or targeting a level of production above 7.5 Bcf a day, you probably want to be underwriting a price meaning you have confidence in a forward look for two to three years that's $4 or higher. Not quite where we are today. The dynamics for the gas market are super constructive and we feel really good about the near term here. But we also know that like I mentioned earlier, these prices will elicit a supply response.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And so we want to make sure we're not getting in front of that and we're thinking through that and prepared for how that dynamic will evolve over time. Our market never responds perfectly and is always overreacting to one side or the other. But given the lack of rig count increase that we've seen as we've gone through this winter, we do think that the supply response should be a bit more muted this time than what we've seen in some past cycles. And we think that's a really encouraging sign for the health of the market longer term. Now if any of those dynamics change and you see that the look out into 'twenty six, 'twenty seven, 'twenty eight maintains a more constructive dynamic of supply and demand then yes, we could underwrite a higher price.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

I think the most likely thing that would drive that would be if we felt that the utilization of LNG on the Gulf Coast would remain at or near 100% meaning that demand for LNG around the globe maintained a strong pull on U. S. Supply through that entire period. We need to see that evolve. We're not quite there today.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

The power growth demand story in The U. S. Is another angle that could surprise to the upside. You'd have to see a real acceleration in how those plants are built, where they're built and our ability to supply gas to them. We really like our position for the power demand growth story in The U.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

S. Because we are regionally diversified and because we have access to infrastructure that can allow us to grow. So there's a good news story around all of those things, but we want to see that play out before we would underwrite a higher price. And I'm using the word underwrite very intentionally, right. We think about making a multi year investment decision and we think about it as an underwriting decision that should have an appropriate level of conservatism to it and be prepared to capture upside when it's available to us.

[Zach Parham, Executive Director, Equity Research at JP Morgan]

Thanks Nick. That makes a lot of sense.

[Operator]

Thank you. And our last question will be coming from the line of Bert Donis of Truist. Your line is open.

[Bertrand Donnes, Financial Analyst at Truist Securities]

Hey, morning guys. Thanks for getting me on the on potential data center agreements. Maybe what are your thoughts on how involved you need to be in the project? I guess, where on the spectrum do you fall if maybe all the way on one side is you need to be a part of the upfront spend or maybe all the way on the other side where you just provide the gas and get a fixed price or a premium? And do you think there's room for a consortium of names to provide the gas supply or should it be more siloed with each producer having kind of their own individual agreement?

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Those are good questions, Bert. And I don't think they're completely known yet. We're open to all commercial structures associated with the creation and support of long term demand for our industry. What we like about those projects is that they do represent long term structural demand, really sticky, not weather driven short term events. So we're open to supporting that in a number of different ways, but we are also very cognizant of our cost of capital and what would be efficient for our shareholders for us to invest.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

So, I don't know that we need to invest capital in the infrastructure, but under the right economic scenarios, would we? Sure. We do definitely focus on what it means from a bottom line standpoint for the gas that we sell and the opportunity that we have to create a total return on our activities. As to whether or not we can do supply agreements like that on our own or you need a consortium, given our scale of supply, investment grade balance sheet, our ability to deliver gas to a number of different places, We think it's perfect we're perfectly capable of doing things like that on our own, maybe even uniquely so. And at the same time, if there's a series of plants or a series of customers that want to have gas from multiple locations or want some diversity of supply, we can work with others on that as well.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

But we do think we're well situated to be a sole supplier for certain projects.

[Bertrand Donnes, Financial Analyst at Truist Securities]

Got you. Very clear. And then just shifting gears a little bit, you outlined most of the potential growth in the productive capacity scenario would come from the Haynesville, but I assume maybe some growth happens in Appalachia at higher prices. And a few of your peers outlined growth plans in Appalachia that I think assume in basin demand is going to materialize. But could you maybe talk about if you're seeing availability of transportation pickups?

[Bertrand Donnes, Financial Analyst at Truist Securities]

I mean, are there roll offs of other operators that aren't growing? Or just maybe how you think about it, if there is Appalachian growth, where do those incremental volumes head? Thanks.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Another good question, Bert. I think there's a little bit of all of that, not maybe in huge size. So there's always a little bit of roll off from others as the basins mature. When that happens, we're really well positioned, should we want it to take advantage. There's definitely some in basin demand growth.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And like I said, we're in the middle of a lot of those conversations to try to help encourage that. There's discussion of new infrastructure and you've seen some of that in the press lately and we're going to pay really close attention to that. And if those projects make sense, we'll be a part of that as well. The assets that we have in Appalachia, particularly our Northeast Pennsylvania position, is the most economic gas in The United States.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And any opportunity that we have to deliver more of that into a constructive market with

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

But there's probably But there's probably a better opportunity to see those things happen today than there has been in quite a long time.

[Bertrand Donnes, Financial Analyst at Truist Securities]

All right. Thanks, Nick.

[Operator]

Thank you. And that does conclude today's Q and A session. I would like to turn the call over to Nick for closing remarks. Please go ahead.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

Thanks everybody for joining the call today. We're really excited about what 2025 and 2026 has in store for us. The market's been volatile and we are better prepared for that volatility we think than just about anybody else out there. We look forward to using that preparation and flexibility in our business to create incremental and attractive return for shareholders. We'll all be on the road quite a bit over the next few weeks.

[Domenic J. Dell’Osso, President & CEO at Expand Energy]

And so probably see several of you out on the conference circuit and look forward to engaging with everybody. Talk to you soon. Thanks.

[Operator]

This does conclude today's teleconference. Thank you so much for joining. You may all disconnect.

Participants

Analysts

• Chris Ayres, VP – Investor Relations & Special Projects at Expand Energy
• Domenic J. Dell’Osso, President & CEO at Expand Energy
• Matthew Portillo, Partner & Head of Research at TPH&Co
• Douglas Leggate, MD & Senior Research Analyst - Integrated Oil, Refiners and E&Ps at Wolfe Research, LLC
• Scott Hanold, Managing Director - Energy Research at RBC Capital Markets
• Josh Viets, Executive VP & COO at Expand Energy
• Devin Mcdermott, Executive Director at Morgan Stanley
• Neil Mehta, Head of Americas Natural Resources Equity Research at Goldman Sachs
• John Freeman, Managing Director at Raymond James Financial
• Paul Diamond, Analyst at Citigroup
• Charles Meade, Research Analyst at Johnson Rice & Company L.L.C.
• Zach Parham, Executive Director, Equity Research at JP Morgan
• Bertrand Donnes, Financial Analyst at Truist Securities