John Turner : I’m going to let Brian answer that. Yes. Jim, it’s pretty close to 50-50. They’re also very heavily weighted in the logistics business like us.
Jim Rollyson: And do you think, Brian, margin-wise, is their logistics business somewhere running close to what you guys have been doing historically? Just kind of trying to fare it that part out to get to the 110 to 125 of guidance.
Brian Leveille : Yes, very similar. Obviously, we’ve got a change coming up with the Dune Express to expand margins. But historically, it’s pretty similar.
Bud Brigham : Yes. I might add just kind of thematically to help you think about the logistics. When you think about — and we talked about this as we were at a conference recently and the fact that historically, OpEx, 70% of OpEx has been labor made in the seat. And when you look at what we’re doing with the Don Express, we’re completely eliminating the ban of the seat for that 42-mile haul into the most prolific producing province in the country. They’re in the center of the Delaware — Northern Delaware Basin. And then we’ve got last mile from there. But then you look at — so that’s going to be a real leap forward in terms — obviously, in terms of cost structure and margin capture for us and will be additive to 25%. And then on top of that, you look at what we’re doing with the high-capacity trucking double, triple trailering significantly reducing the cost per ton delivered with that.
And then similarly, in the Midland Basin, what Hi-Crush has been doing with the proximal Encore mines, taking trucks off the road and reducing drive time. So it’s really exciting when you think about over time what we’re going to be able to do to really change the logistics business and really move it more tort when you’re looking to do an express it really is a midstream enterprise. And so the margin impact over time is really going to be exciting as you go forward. And you look at the margins of this company, we have a slide, Slide 14 in the investor deck that shows, I mean nobody has enjoyed the margins that we do and we try to about half the multiple of those companies that approach us even on the margin. So it’s really exciting as you roll forward with this company with the scale and with the complementary assets we’re adding and the innovative culture, we’re going to be able to further drive down our cost structure and drive up our margins, which are already at very exciting levels.
I don’t know if you guys want to add to that.
John Turner: Yes, I think I think it’s well covered.
Jim Rollyson: Thanks for that color, Bud. And then, John, last thing, just on the $26 to $28 a ton kind of full year pricing, maybe a little color. When we sat here a quarter ago, you guys were kind of talking market within the mid-upper 20s to low 30s, and you were still about 40% contracted. Obviously, on a combined basis, you guys are 80% contracted. Maybe how some color on how the Hi-Crush contracting weighed on that versus just where the market has been, where the weak market we’ve had going into the back half of the fourth quarter? Just kind of how you ended up with this range versus where we had been historically.
John Turner: Yes. The Hi-Crush was — they have a contract profile that they were heavily contracted there at a more lower price than what we were contracting that. So really, what you’re seeing there is an adjustment is reflective of what were their contract position. As you know there — I’d say that they’re almost 100% contracted on their ’24 volumes. And it’s at a lower price than where we were as where our contract profile is.
Jim Rollyson: Got it. Thanks guys.
John Turner: Thank you.
Operator: Our next question is from Sean Mitchell with Daniel Energy Partners.
Sean Mitchell : Good morning guys. Congrats on the deal. Bud, I think you addressed this a little bit in your opening comments, but can you just talk a little bit about customer overlap in particular in Kermit, maybe or in the Delaware because obviously, the Midland is somewhat new, but what’s the overlap and the customer mix here in Kermit?
Bud Brigham: Well, there’s not much. It’s very complementary in terms of customers. John, I don’t know if there’s any specific — I mean, the fact that their assets are certainly weighted towards the Midland Basin and the logistics is weighted towards the Midland Basin and our logistics, what we’ve been doing, of course, with the Dune Express and the high-capacity trucking is really have more impact in the Delaware Basin. So it’s kind of been natural, organic that we have very complementary customer bases. We’ve been logistically challenged on the far eastern side of the Midland Basin, given the distances to move our proppant over there. So it’s just — it’s very beneficial in that regard. I don’t know…
John Turner: Yes. I mean, I’d like Bud, I think there’s very little overlap. Obviously, some of the largest — most of the largest produce operators in the Permian Basin. I think the areas done a great job with those customers and those customers value those relationships just like ours do, and we look forward to maintaining those relationships going forward and serving those customers our entire top tier customers look forward to serving that going forward.
Bud Brigham: I mean, I think part of it is logistics is so key to your proppant sales. And so it’s been natural that even though Kermit plant has been more weighted to the Midland Basin because that’s where the logistics assets are. And we dominate the Delaware because our logistic assets are second to none in the Delaware. So it’s really worked out well and very complementary.
Sean Mitchell: And Bud or John, as you look at the combined assets or the assets of the combined company, where do you guys see maybe an opportunity for growth? I mean, what are you most excited about in terms of silos, boxes, more trailers, mobile mines? What are you most excited about when you look at the combined assets?
