Josh Silverstein : Just some questions around potential LNG opportunities in the future. You mentioned at the Analyst Day that you have options around Port Arthur Phase 2, 3 and 4 and even at Costa Azul as well. Can you just give us some more details around the options? Does it need to be at the 30% like you did in Phase 1 of Port Arthur? 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?
William Bullock : Yes. So 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 Costa Azul on Phase 2. And so those are long-dated options that we continue to look at. I talked a bit about Phase 2 earlier in the call. And so there 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.
Paul Cheng : Maybe this is for, Nick. Nick in the Investors Day, I thought luckily you were talking about 2023, the shale oil production of around 1 million barrels per day. And in the first quarter, you’re already there. Does that means that for the rest of the year that the Lower 48 shale oil and Montney together will be pretty stretched? Or that, that number is somewhat conservative now?
Nicholas Olds : 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, we’ve got 80% of our 2023 Permian wells are 2 miles or greater as we’ve got a fairly large portion that are of 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 Paul, our plan will deliver at least mid-single digits for Lower 48.
Operator: The next question comes from Scott Hanold with RBC Capital Markets.
Scott Hanold : I just wonder if you could provide some updated commentary if you have any on Venezuela. About a month ago, there was some talks about kind of easing oil sanctions there. And you all have a potential big asset or at least valued that at one point in time, were looking to extract. 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?
Ryan Lance : Yes, Scott, yes, we’re right in the middle of all those conversations, as you might imagine, including the most recent conversations around the Citgo refining assets. We’re in the queue. We’re in the — right in the middle of anything that would happen there. We have — as a reminder, an ICC judgment of $2 billion. We’ve collected about $700 million on that judgment to date. So we have an outstanding — what they owe us on that particular judgment. We’re in an appeal process with ICSID which is the other tribunal, and that’s an $8 billion potential award coming. Now there’s some overlap between the two, so you can’t necessarily add the two together. But I guess the point is there was 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 Citgo is certainly helpful in that regard. It looks like despite the sanctions that are on the Venezuelans and on U.S. companies for 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.
Operator: The next question comes from Alastair Syme with Citi.
Alastair Syme : In your remarks, beginning on the Lower 48, you mentioned about infrastructure build. And I was really just interested to try and understand across the Lower 48, but I guess, especially in the Permian, what’s the sort of ratio of capital that’s going into infrastructure versus drilling? I guess, it changes over the life of the assets. So I’m just kind of intrigued what’s the point of asset like are we in terms of that ratio?
Ryan Lance : Yes. I’m not sure the exact ratio. Maybe Nick 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 have a comment, but I don’t think it’s much different than what we’ve been doing for the past few years.
Nicholas Olds : Yes, Alastair, it’s very limited as far as on the infrastructure spend, most of your expenditures is on drilling and completions in the Permian as an example.
Operator: The next question comes from Raphael DuBois with Societe Generale.
Raphael DuBois : I just have one question about the working capital deterioration in 1Q. I was wondering if you could tell us how much of it is due to some Norwegian cash tax catch-up? And what is it to expect for the rest of the year?
William Bullock : 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 million use of working capital. For Q2, we’d expect that to be just over $1 billion. And as you rightly 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 second quarter of 2023. And then looking for the rest of the year, assuming we don’t see FX rates move materially for the remainder of the year, we’d expect — we wouldn’t really expect any material working capital movements across Q3 or Q4. So I hope that helps for kind of full year view.
Operator: The next question comes from Neal Dingmann with Truist Securities.
Neal Dingmann : 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%?
Ryan Lance : Yes. Well, I think, Neal, you have to kind of go back to how we set the VROC in the first quarter. That was actually set in the third quarter of last year in a $100 price environment. So we probably had a ratable — a little bit higher distribution in the quarter and then it gets more ratable as we go through second, third and fourth quarter as we deliver the $11 billion that we’ve targeted for this year. And that’s evidenced by how we set the VROC for the third quarter at $0.60 a share.
Operator: Our last question comes from Leo Mariani with ROTH MKM.
