So my point is it’s sort of — we are now entering spring and summer with solid gas storages. There are some underlying growth in demand in Europe and China. And small changes can have significant impact on price. That is still the case. So yeah. And then, of course, I can — you all know that sort of current price level is still high in a historical setting, and we have a $2 cost of our gas supplied into this market. So we are going to — this is going to be a very healthy business for us, no matter what.
Bard Pedersen : Thank you. And moving to the next on the list, that is Jason Gabelman from TD Cowen. So Jason, please go ahead.
Jason Gabelman : Yeah, hey. Just one quick one for me. Looks like international E&P tax rate was pretty low for the quarter. Just wondering what drove that and what the expectations are for that segment’s tax rate moving forward? Thanks.
Torgrim Reitan : Very good, Jason. Thanks. Yeah. So I mean in the U.S. segment, we reported a 25% tax rate. And we have said that we guide at around 22 to 30. So that is sort of a normal tax rate. Where we saw this quarter deviation was with EPI, if you look away from the U.S., where we reported a tax rate of 15%, and that is below our guided range, which is 35% to 50%.
Bard Pedersen : 30% to 45%.
Torgrim Reitan : And that is due to UK and assumptions related to EPL, the windfall taxes and methodology. So I mean, we have had comments from auditors that maybe have been too conservative in the past. Not too conservative, but that’s sort of — there’s an adjustment to that going forward. That makes sense. So we have made some adjustments for — based on that methodology as such. So that is a one-off effect related to that. So still, you should expect tax rate to come into sort of the guided range.
Bard Pedersen : Thanks.
Jason Gabelman : Thanks.
Bard Pedersen : Thank you, Jason. Next one is Peter Low from Redburn.
Peter Low : Hi. Just a couple of quick clarifications. You talked about a 12% to 16% nominal equity return that you expect to Empire Wind 1. That’s post project financing. But does that include a successful farm down? Or would that increase the returns further? And the second one was just on the $70 billion kind of cash flow guidance for this year, you guys said that remains despite the change in the commodity price. Does that include any working capital? Or is that an ex working capital?
Torgrim Reitan : Very good. Thanks, Peter. Yeah. So let me just be clear that sort of the 12 to 16 does not include any future farm down. But I think it’s fair to say that the 12 to 16, that is sort of full cycle up to where we are currently. Taking into account the divestment to BP a few years back, but no future divestment and gains as such. Then on your $17 billion or $17.5 billion in cash flow from operations yeah, very good that you asked that because I had told myself I need to say this on the call. It does not include working capital movements as such. This is sort of before that. So the only place sort of in our reported numbers, where you’ll see the working capital movements is sort of in the balance sheet numbers on net debt and sort of the cash position as such.
Peter Low : Okay. Thank you.
Bard Pedersen : Thank you. Next one is Chris Kuplent from Bank of America. Please go ahead, Chris.
Chris Kuplent : Yeah, thanks for taking my question, Torgrim. You’ve covered a lot of ground. So let me just take the opportunity to ask you, you’ve streamlined your international portfolio over the last few years. And yet here we have a $10 billion perhaps more discovery in Namibia. So I just wanted to double check how jealous that makes you whether potential opportunities for farming into those kind of discoveries. You don’t have to comment on the specific data rooms may yet add new territories and countries to your international portfolio. Thank you.
Torgrim Reitan : Thanks, Chris. I’m not in being jealous is not part of my job description, so I’m not jealous. But clearly, congratulations to those who have made that discovery. And then hopefully, they can develop it in a good manner. Clearly — or what we do in our international businesses to say, okay, where do we want to deepen and where do we want to be large. And we have decided there are three countries that are sort of really areas for deepening. It is Brazil. It is the U.S. and it is the UK. So clearly, there, we will be looking for opportunities, continue to build the business. And then there are other countries still important for us, and that clearly will work and mature and optimize Angola, Algeria, as two examples.
And then there are countries that we are leaving. And as you know, we have announced divestment of Nigeria business and Azerbaijan businesses. Very good and healthy cash flows because we found it better to divest and take benefit of the price environment we are in currently and redeploy that other places in the portfolio.
Bard Pedersen : Thanks. Thank you, Chris. Next one is Nash Cui from Barclays. Nash, your microphone is open.
Nash Cui : Hey, good morning, everyone. It’s Nash here. Two questions, if that’s okay. So the first one is you outlined big payout this year and for next year, a drop in payout for 2026 onwards. So I appreciate it’s a long time way. But at what point do you start to look at whether your 2026 payout can be competitive? And then my second question is on MMP. I think you mentioned in the presentation that MMP performance has been better than guidance, 5 times in a row. So I guess with your potential better underlying performance or better trading volume, do you expect to give an updated guidance on that? Thank you.
Torgrim Reitan : Very good. Thanks, Nash. On your first question, yes, it is a significant payout this year and also next year. The way we want to communicate around our capital distribution is that we want to have ordinary cash dividend that you can bank that is there and it will grow by $0.02 on an annual basis. In addition, there will be sort of a $1.2 billion share buyback that will be sort of the run rate that you should believe that comes on a steady basis. And then on top of that, we aim to use share buyback to sort of increase or adjust sort of the capital distribution. So clearly, we are very determined that we are going to provide you with a competitive total capital distribution package going forward. We have now given you sort of outlook for two years, and that is sort of what is out there.
I think it’s also very important for me to say that — this is a high priority for us as a company, and we do have a significant flexibility in our investment program to adjust our spending and adjust our activity to find a good balance between serving all purposes as such. On your second question, whether we want to update the guiding on MMP, the answer to that is no, we are not. This was recently updated, and I’m glad to see that the business is performing well and in a predictable manner, but we have no plans to update the guiding.
Nash Cui : Perfect. Thank you.
Bard Pedersen : Thank you, Nash, and thank you, Torgrim. We are fast approaching the hour, and I know it’s a busy day for all of you. So I want to thank you all for calling in and for asking questions. As always, the I team remains available if you have additional follow-up after the call. So with that, I wish you all a good rest of the day. Thank you all.
Operator: Thank you. This concludes today’s conference call. We thank you for participating. And you may now disconnect.
