John Christmann: Yes, you’re cutting out for most of your questions. So I think it’s — do we have enough. And I think the answer is, as we’ve said all along with Krabdagu, we’re looking at an oil hub, which incorporates both Sapakara and Krabdagu. And the thing we’ve been focused on is a scope and scale right. So at this point, it’s all I’ll say the connected original in place. We put in the documents this morning does not include the appraisal work from Krabdagu yet. So we’re making good progress.
Leo Mariani: Okay. That’s helpful. And then just on the U.S. side, Alpine High, you got 3 wells. You kind of mentioned that you’re pleased with the progress. I was hoping to maybe get little more color on those 3 wells in terms of maybe how long you’ve been flow testing? And then I guess, is there any update on the Austin Chalk for APA?
John Christmann: At this point, no update on the Chalk. And on the Alpine wells, we’re flowing them back at constrained rates, but we’re very pleased with the deliverability and the early results.
Operator: Our next question comes from Roger Read at Wells Fargo Securities.
Roger Read: Yes. I guess maybe follow up a little bit on some of the oilfield inflation, deflation issues and broaden it beyond the U.S. to take a look at what the currency issues might portend for the cost structure in Egypt. Or does that not matter given the overall structure of the contract there in terms of the net barrel performance?
John Christmann: Well, number one, there’s not a lot of competition for rigs or services in Egypt, right? So we’ve seen pretty stable cost with the devaluation that’s actually helped cost structure now. But as I said earlier, we are assisting our nationals and doing some things to help with the inflation.
Roger Read: So you wouldn’t expect a net reduction given like you said, kind of devaluation issues.
John Christmann: No, not big. Not big.
Roger Read: Okay. And then in the U.S., you mentioned obviously contract structure in place. But I was just curious, are you looking at indexed contracts? When is the next time we should see any potential for an inflection up or down in terms of the next contract rollover as we think about the rigs and the services?
John Christmann: We kind of keep a portfolio where some are on long term, some are on short and some are multiyear. And so it’s a constant process of rejigging those, and that’s kind of underway now and will continue. But it’s not going to have a near-term material impact on our current cost structure of this year’s capital program. So it will really start to show up in the $24 next year.
Operator: Our next question comes from David Deckelbaum at TD Cowen.
David Deckelbaum: I just wanted to follow up a little bit on just Alpine High. The decision, obviously, to reduce activity there makes sense in light of commodity pricing. But as we think about fulfilling contracts like the Cheniere contract and others, are you content to just fill with third-party gas? Or is there a certain level of organic gas that you’d like to maintain out of Alpine High as you get into ’24?
Stephen Riney: No. For quite some time, our is that every molecule of gas we produce in the Permian Basin is sold in the Permian Basin, and our trading organization will take care of both the long-haul transport obligations through purchasing and selling gas, and we’ll also take care of the Cheniere contract with purchased gas.
David Deckelbaum: Got it. And then maybe if I could just wrap up on Suriname. I guess as we think about moving towards an investment decision, do you anticipate that we’ll have enough data points, just given some of the Krabdagu delineation and appraisal work in combination with we already know at Sapakara to reach a decision this year. Is that in line with your internal thinking?
John Christmann: I would just say we’re waiting to see results, right? I mean we’re making good progress. As I’ve said a number of times, we’re kind of focused on potential scope and scale of what that first project would look like as there’s an incentive for everybody to size upwardly. But we’ll know when we get there.
Operator: Our next question comes from Kevin MacCurdy at Pickering Energy Partners.
Unidentified Analyst: There’s been much discussion in this earnings season about potential deflation on shale well costs, but I’m curious what you’re seeing on the international side. Outside of the increased receivables, what is your view on raw materials and services in Egypt and the North Sea? And how is that trending relative to last year?
John Christmann: Well, in general, we — like I said a few minutes ago, we don’t have a lot of competition for services in Egypt. So it really kind of goes with the commodity fuels up, for the most part, chemicals. In the North Sea, we’re going to be popping the Ocean Patriot. So if anything, capital spending is dropping there, but nothing major, nothing surprising in the way of the international service side.
David Deckelbaum: Great. And congratulations on reducing your 2023 CapEx budget. Kind of going back to the Ocean Patriot rig, are the savings from dropping that rig already built into your updated budget you released yesterday? Or have those savings effectively been redirected to the Permian?
John Christmann: They were in the plant from early on them because we plan to drop that rig midyear at the start of the year.
Operator: Our next question comes from Neil Mehta at Goldman Sachs & Co.
Neil Mehta: John, as you started off in your remarks, there’s a lot of uncertainty in the near term as it relates to the commodity price and the global economy. And so I’d love your perspective on how you as an organization are building downside resilience if there is a harder landing. And what are the lessons learned from experiences in 2015 and 2020 that you can carry forward? And one of the things that I think you guys have made terrific progress on since COVID has been really cleaning up the balance sheet and taking out $3 billion worth of debt. So maybe you could speak to where you are in that route.
John Christmann: Well, I’ll say a few comments and I’ll let Steve jump in on the balance sheet. But I’d say, first and foremost, the best flexibility you have is being able to reduce your activity. And you’ve seen us do that with the lean gas drilling in the U.S. You’ve seen us do that in the North Sea. So when it’s time to stop investing, you need to stop investing. And those are the lessons we’ve learned. Stay focused on cost and maintain that flexibility to invest in the projects that are going to continue to generate the long-term returns.
Stephen Riney: Yes. I’d just add that in the last two — quarter years, we’ve reduced debt by $3.2 billion while also buying back $2.4 billion worth of equity. The biggest thing, I think we accomplished in the bond reduction, the debt reduction flows in the near term. And in the near-term maturities, we’ve got 30% of our bond debt matures here in the next — well, between now and 2030. And only around $350 million of that matures in the next 5 years. So we don’t have much of a runway to worry about. And then 70% of our debt is 2037 and beyond. We’ve got some — we’ve got a really good profile for debt maturities as well. And then the last thing I would add is cost management. John talked about the ability to reduce the capital budget, but we’ve been very disciplined on managing our cost structure as well. Keeping that low helps certainly build resiliency.
Neil Mehta: Can you remind us where you are in terms of getting to investment grade with all the agencies? And given what you’ve done with the balance sheet, I feel like you’re getting close . So any perspective on.
