Justin Loweth: Sure, happy to. So, we’re currently completing our third pad with the new E-fleet. It’s gone very well and one of the things, I’m most happy to see is that we’re achieving approximately 90% diesel displacement at this point out of that fleet, which is what we were hoping to do. That has an additional benefit, which is diesel prices are starting to move upward and our exposure to that is much more limited, than it would be if you’re using a tier two, tier four fleet. So overall, positive and we’re just prosecuting the development plan and intend to continue using it and able to use our own gathering system to provide the gas, which is a dual benefit.
Zach Parham: Thanks, guys.
Operator: Thank you. The next question will be from the line of John Abbott with Bank of America. Your line is now open.
John Abbott: Hey. thank you very much for taking our questions. So, this question may be for Tim here. It’s on the utility rate case that was filed for New York and the $89 million increase that you’re looking to obtain. When you sort of look at other, I mean, when you look at that number and you look at what other peer utilities have asked for within the state, what’s your sort of competence on that sort of number?
Timothy Silverstein: Yes. John, it’s a good question. I think, we’re starting right now from a position of very low delivery rates. We’re the lowest delivery rate company in New York State. All of the other utilities that have been in, they’re facing the exact same cost pressures that we are seeing. So, while on the surface, it’s a larger increase that the fact that we’ve stayed out of a rate case since 2016 and our delivery rates really haven’t been unchanged since 2008 for the most part. I think, we’re hopeful we get a good settlement that allows us to earn the returns and recover the costs that we have. But it’s early on in the proceedings, I don’t want to speak to exactly the direction of travel it’ll take. but hopefully, that gives you some color
John Abbott: That does. And you just spoke to the trajectory of cash taxes. but that new tax rate guide of 25% to 25.5%, is there catch-up in that guide from 2023? And I guess, my question is, is that the applicable rate post-2024 or does it tick up towards the higher end of that range? How does that kind of work there, Tim?
Timothy Silverstein: Yes. So, there is no effective rate in impact of the catch-up. That all happens as a temporary difference from a tax perspective. So, that isn’t driving it, it’s largely driven by the nature of, of our Pennsylvania jurisdiction and how they treat repairs in this deduction specifically. So, I’d expect this effective tax rate ultimately to maintain relatively consistent levels but it will depend on the level of capital that we deploy in Pennsylvania and ultimately, how much of that is eligible for this deduction versus being capitalized from a tax perspective.
John Abbott: That was very helpful. Thank you for taking our questions.
Timothy Silverstein: You bet.
Operator: Thank you. [Operator Instructions] The next question will be from the line of Trafford Lamar with Raymond James. Your line is now open.
Trafford Lamar: Guys, I guess, my first one is probably for Justin. Justin, looking at the EDA, I was wondering if you could touch on maybe well productivity comparison between the Marcellus and the Utica and kind of how you all view the two targets from a planning and development standpoint, deciding which ones to drill?
Justin Loweth: Sure, Trafford. The well productivity, we see, is just higher deliverability out of the Utica. It’s the pressures we have there are quite a bit higher. So, what we can achieve out of those wells are sustained rates that are $15 million to $20 million a day in sustaining those rates for many months. So, you get a lot of gas you hold, you hold pressure, so that you get a lot of gas at a sustained rate for quite a long period of time. And given the contiguous nature of our development, we’re able to drill very long laterals, pretty much all of our laterals are north of 10,000 feet, probably the averages in the 11,000 foot to 13,000-foot TLL. The Marcellus wells are great. They don’t have quite the pressures. The deliverability we have in Tioga is very good.
