Nicholas Olds: Yes, yes, yes. So if you just take a look at that second quarter top end of the range performance from Lower 48, as I mentioned, we had strong performance both on accelerating the wells, but also strong well performance. That’s roughly split between operated and non-operated. And obviously, when you look out in the Delaware, OXY has a large component, but we have a number of other JV partners that are contributing to that as well, but OXY has a big component.
Doug Leggate: Maybe do you say there’s a notable difference between the productivity and the JV and your legacy assets or no?
Nicholas Olds: We constantly, Doug, look at all benchmarking. So we receive the ballots from our non-operated positions. We evaluate that to meet our cost framework. I’d say in general, we’re fairly aligned. There’s always a little bit of difference in spacing and stacking and completion design, but we’re roughly in line. And obviously, the positions that we have in the operated position is really in the core, less than 12 billion barrels of resource, less than 40, averaging 32. We got great legacy positions out in the Delaware.
Doug Leggate: Great. Ryan, my follow-up is probably for you. you’re adding $1 billion of cash flow from Surmont. Fantastic deal for you guys. Again, congratulations on that. You’ve evolved the LNG portfolio even since the Analyst Day. But yet, we still have 1 of the lowest ordinary dividend yields in the sector that you can clearly cover at very, very low oil prices. So I’m just wondering if I could ask you again to share your thoughts on whether some of that increase in free cash power of the portfolio translates to a more ratable or a higher ordinary dividend, which, frankly, we think you get better recognition for.
Ryan Lance: Thanks, Doug. You’ve been a consistent messenger on this particular point. I give you credit for your tenacity, that’s for sure. Look, yes, we recognize that we’re acquiring some assets to get significant free cash flow potential at $60 to $80 even at our mid-cycle price. I guess the thing I’d say, first and foremost, Doug, is you shouldn’t question ConocoPhillips’ commitment to giving a significant amount of our cash flow back to our shareholders. So the last 6, 7 years, we’ve averaged 45% this year, depending on your outlook for prices. We’re probably closer to 50%. So first and foremost, we’re going to be competitive on giving a significant amount of our cash back to shareholders. And again, that’s CFO, not free cash flow.
Now to your point, even at a constant price, we’re going to be generating more free cash flow as we come out of the APLNG and Surmont activity. Our framework really hasn’t changed. Look, what I want — what we want on the base dividend is something that is that we said we see a lot of value being able to grow that at a top quartile rate over time, over the long term, and we intend to go do that. We set our framework around a mid-cycle price, and you may differ or argue with our mid-cycle price, but we try to set a framework around a mid-cycle price. We want to buy some of our shares back through the cycles so we don’t get caught pro-cyclically. And then we introduced that third tier VROC to address when prices are well above mid-cycle, and you’d argue $80 as well up in mid-cycle.
So I think our cash yield is competitive. I think your point is we may get more credit if we put a lot more into the base dividend. We just think that growing the base dividend in a top-tier amount annually gives us a lot of credit as well and doesn’t obviously raise the fixed cost to the company. But the improvements are we can afford a bit more, but we’re focused on sort of the framework that we outlined and watching pretty volatile commodity prices. So I’d just remind people, just a month ago, WTI was back in the 60s. So we’re trying to set a framework that we know works through the mid-cycle, and we set a framework that rewards the shareholders and recognizes the torque that the company has to the upside when prices are much higher. We like the 3-tiered framework.
We’ll look at it again. As we finish this year and go into 2024 we’ll look at where our shares are trading, we’ll look at where the commodity prices are at, and we’ll try to set the channels appropriately. But you can count on us delivering a significant amount of our cash flow back to our shareholders as we’ve done over the last 6, 7 years.
Operator: Our next question comes from the line of Sam Margolin with Wolfe Research.
Sam Margolin: Apologies if this is a little early, but I want to ask about 2024 capital if I can and maybe focus on Willow. There should be a natural tailwind in capital because the step-up in Willow is less than the Port Arthur payment. But I just wanted to see if there’s anything we should know about project life cycle at Willow that creates a different shape of spend over the development for ’24.
