Bob Brackett

Bob Brackett inquired about APA's exploration philosophy for gas in Egypt, specifically whether it focuses on existing infrastructure or includes stepping out to more distant, potentially larger opportunities across its 7.5 million acres.

Answer

CEO John Christmann explained that the new gas price environment (post-November 2024) allows them to re-evaluate gas prospects. After initially targeting low-hanging fruit near existing ties, the exploration team is now taking a regional approach, looking at deeper pockets and structures historically avoided due to gas-proneness. EVP of Exploration Tracey Henderson added that they are reprocessing seismic data and building a longer-term gas portfolio, with some wells planned for this year.

Bob Brackett inquired about APA Corporation's exploration philosophy for gas in Egypt's 7.5 million acres, specifically asking if there is an appetite to step out to more distant opportunities or if the focus remains on near-field prospects.

Answer

John Christmann, CEO, explained that the new gas pricing framework (effective November 2024) allows APA to re-evaluate deeper, gas-prone pockets previously avoided. He noted the addition of 2 million acres and a shift towards a regional approach for gas exploration, building a longer-term gas portfolio. Steve Riney, President, added that they have reprocessed seismic data and established dedicated teams to focus on this strategy.

Bob Brackett asked if the lower Q3 cash return percentage was simply a matter of timing and requested an update on the Permian gas takeaway situation, particularly regarding the Matterhorn pipeline and curtailment strategy.

Answer

CEO John Christmann confirmed the lower Q3 cash return was 'definitely... just timing,' influenced by market access restrictions due to material corporate events. CFO Stephen Riney addressed gas pricing, stating that recent Waha price volatility was primarily due to temporary maintenance on other pipelines, not Matterhorn delays, and he expected the situation to improve shortly.

Bob Brackett asked why Barnett well costs are significantly higher than the Midland Basin core, despite similar vertical depths, and what potential solutions exist to reduce these costs. He also inquired about the strategic priority of international opportunities for Diamondback Energy.

Answer

COO Danny Wesson explained that Barnett drilling uses oil-based mud and an extra string of pipe, and delineation wells were conservative. He outlined plans to reduce costs by moving to multi-pad development, simul-frac, and targeting 15,000-foot laterals. On the completion side, larger jobs are needed for four wells per section. CEO Kaes Van't Hof stated that international opportunities are a low strategic priority, primarily for understanding global cost curves, and reinforced the company's focus on its strong, long-duration Permian Basin inventory.

Bob Brackett compared Barnett well costs to typical Midland wells, asking what factors contribute to higher Barnett drilling/completion costs and potential solutions. He also inquired about the strategic priority of international opportunities for Diamondback Energy.

Answer

COO Danny Wesson explained Barnett's higher costs are due to different resource, oil-based mud, extra pipe string, and conservative drilling for delineation. He detailed plans for cost reduction through multi-well pad development, simul-frac, and targeting 15,000 ft laterals. CEO Kaes Van't Hof stated international opportunities are strategically low, primarily for understanding global cost curves, reinforcing a 'staying home' strategy due to strong Permian inventory and basin expertise.

Bob Brackett contrasted the current 'yellow light' scenario with the 'Liberation Day' period, asking about Diamondback Energy's confidence in CapEx decisions during a 'normal typical oil down cycle.' He also inquired if the 6% of wells hitting 'other zones' (beyond the main four) year-to-date represents a development or exploration strategy.

Answer

Kaes Van't Hof (CEO, Diamondback Energy) agreed that 'Liberation Day' was an unexpected change with demand shock concerns, while the current attitude is to 'figure it out' and make more money despite headwinds, aiming for long-term shareholder value through balance sheet integrity, share buybacks, and dividends. He explained that hitting 'other zones' is mostly moving into development (Upper Spraberry, Wolfcamp D) for inventory duration. Danny Wesson (COO, Diamondback Energy) clarified it's a combination, allocating capital to prospective zones for co-development and resource expansion (Barnett, Woodford), with promising public results expected soon.

Bob Brackett contrasted the current 'normal typical oil down cycle' with the 'unusual, strange environment' of Liberation Day, asking if the current confidence in CapEx decisions stems from this difference. He also inquired about the 6% of wells hitting 'other zones' (beyond Middle/Lower Sprayberry, Wolfcamp A/B), asking if it's a development or exploration strategy.

Answer

Kaes Van't Hof (CEO, Diamondback Energy) confirmed that the current environment, while a down cycle, is more predictable than the sudden, unexpected changes of Liberation Day, which also raised concerns about demand shock. He emphasized the company's resilience, aiming to not compromise the balance sheet, buy back shares, pay dividends, and maintain production through the cycle. Regarding 'other zones,' Kaes Van't Hof explained that most of it is moving into development (e.g., Upper Sprayberry, Wolfcamp D), which is good for inventory duration. Danny Wesson (COO, Diamondback Energy) added that it's a combination of development and resource expansion, with promising results from deeper zones like the Barnett and Woodford.

Bob Brackett questioned whether capital reductions involved 'high-grading' by selecting better crews and locations, and asked about the process for renewing the share buyback authorization.

Answer

COO Daniel Wesson clarified that there is not significant high-grading of crews or projects, as resources are consistent and the company is already developing its top-tier inventory, a point echoed by Chairman and CEO Travis Stice. President Kaes Van’t Hof added that the board is supportive of buybacks and will consider increasing the authorization as the current limit is approached.

Bob Brackett inquired about the flexibility of the 2025 operational plan, asking how the company can adjust to the macro environment and whether these adjustments would be gradual, like deferring wells, or more significant, like dropping rigs.

Answer

President and CFO Kaes Van't Hof emphasized that the company has significant flexibility to dial activity up or down in response to the macro environment, which he currently views as weak. He confirmed they already make tactical adjustments, such as dropping rigs mid-year when ahead of schedule. COO Danny Wesson added that the supply chain is structured without long-term obligations, enabling the company to pivot activity levels to protect free cash flow.

Bob Brackett asked about the potential volume of Venezuelan heavy crude that could be absorbed by U.S. refineries without impacting heavy-light spreads or backing up Canadian heavy crude.

Answer

Chairman and CEO Mike Wirth stated that he could not provide a simple rule of thumb for the market's absorption capacity. He explained that as more Venezuelan barrels enter the system, they would displace existing supplies, leading to a redistribution of crude around the world and a new market equilibrium, which would be reflected in heavy-light spreads and crude flows.

Bob Brackett followed up on Venezuela, asking how much Venezuelan heavy crude could be absorbed by U.S. refineries without impacting heavy-light spreads or backing up Canadian heavy.

Answer

Chairman and CEO Mike Wirth stated that he could not provide a simple rule of thumb for market absorption. He explained that as more Venezuelan barrels enter the market, they would displace existing supplies, leading to a redistribution of crude around the world and a new equilibrium in heavy-light spreads and flows, which analysts could model in detail.

Bob Brackett asked for Chevron's perspective on the macro oil market view of oversupply in 2026, the Permian's role in accommodating OPEC's spare capacity, the current state of the Permian, and its forecast into next year.

Answer

Chairman and CEO Mike Wirth noted that the Permian rig count is near multi-year lows (around 250 rigs), which most third parties believe is sufficient to maintain current production levels. He highlighted that this depends on continued productive opportunities and operators' commitment to cash returns. He observed efficiency and productivity gains across Chevron's fleet and the industry. He suggested that most companies are guiding to flat or slightly reduced CapEx, implying a plateauing of Permian production rather than rapid growth, while acknowledging the basin's dynamic and responsive nature.

Bob Brackett asked for Chevron's perspective on the Permian Basin, given the macro market view of an oversupplied oil market in 2026 and the need for shale to accommodate OPEC's spare capacity, inquiring about the current state of the Permian and its forecast into next year.

Answer

Chairman and CEO Mike Wirth noted the current Permian rig count is around 250, near multi-year lows, which most third parties believe is sufficient to maintain current production. He highlighted that this depends on continued productive opportunities and operators' commitment to cash returns. Wirth mentioned Chevron's ongoing efficiency and productivity gains, and that most companies are guiding to flattish or slightly reduced CapEx, suggesting a plateauing of production rather than rapid growth, while acknowledging the basin's dynamic nature.

Bob Brackett asked about the potential impact of tariffs on Chevron's capital expenditures and projects, and what measures the company can take to control related costs.

Answer

CEO Mike Wirth stated that the impact is manageable, as direct exposure is limited. He explained that energy is largely exempt from tariffs, 80% of third-party spend is on services, and goods are often sourced domestically. He estimated a potential impact of only 1% on the cost of a shale well, which they are mitigating through supplier engagement.

Bob Brackett asked about the Permian Basin, leveraging Chevron's unique insight from its royalty interests to gauge the level of capital discipline being practiced by other operators.

Answer

CEO Mike Wirth confirmed their extensive mineral rights provide a broad view of the basin. Based on this, he sees other operators 'sticking with their plans,' focusing on productivity and efficiency rather than reverting to a 'growth-at-all-costs' strategy, indicating a continuation of industry-wide discipline.

Bob Brackett questioned whether future upstream portfolio additions beyond 2030 must be 'advantaged assets' and how ExxonMobil plans to scale its Permian technology toolkit.

Answer

CEO Darren Woods clarified that 'advantaged' refers to ExxonMobil's unique capabilities in developing assets, not solely the resource itself, and this approach will continue. Incoming CFO Neil Hansen highlighted ExxonMobil's average ROCE of 11% over the last five years, two percentage points above peers, as evidence of this discipline. Woods added that Permian technology is scalable across the upstream portfolio due to a centralized technology organization, and he is focused on improving recovery rates for both new and depleted fields.

Bob Brackett questioned ExxonMobil's long-term upstream portfolio strategy, asking if future asset additions must be 'advantaged' and about the scalability of Permian technology.

Answer

CEO Darren Woods clarified that 'advantaged' refers to the unique capabilities ExxonMobil brings to asset development, ensuring higher returns than market averages. He affirmed that this approach will not change, with ongoing transformation driving performance improvements. Incoming CFO Neil Hansen highlighted ExxonMobil's average 11% Return on Capital Employed (ROCE) over the last five years, two percentage points above its closest peer, as evidence of this discipline. Woods also confirmed the scalability of Permian technology across the upstream portfolio, emphasizing the centralized technology organization's ability to apply innovations broadly and the focus on improving recovery rates in both new and played-out fields.

Bob Brackett asked for details on the Superior Graphite acquisition, specifically what assets or technology were acquired, how it integrates with ExxonMobil's existing refining petrochemical strategy, and the total addressable market for the new battery anode graphite.

Answer

Darren Woods, Chairman and Chief Executive Officer, explained that the acquisition involved key assets and technology rights related to a differentiated graphitization process. This technology will be used to produce anode material for lithium-ion batteries, leveraging ExxonMobil's carbon molecule manipulation capabilities. He stated the total addressable market could be up to $40 billion, with the goal to outcompete Chinese dominance through lower costs and higher throughput.

Bob Brackett asked for details on the Superior Graphite acquisition, specifically what assets or technology were acquired, how it integrates with ExxonMobil's existing refining/petrochemical strategy, and the total addressable market.

Answer

Darren Woods, Chairman and CEO, explained that ExxonMobil acquired key assets and technology rights to revolutionize the graphitization process for a unique carbon molecule, which can be used as battery anodes. This technology significantly improves lithium-ion battery performance (30% faster charging, 30% more range, 4x longer lifecycle) and aims to outcompete Chinese dominance with a lower-cost, higher-throughput, and more energy-efficient process. The total addressable market (TAM) could be up to $40 billion.

Bob Brackett from Bernstein Research inquired about the impact of tariffs on moving equipment for U.S. projects and how the project organization is managing these risks to meet budget and schedule targets.

Answer

Chairman and CEO Darren Woods stated that the project, procurement, and supply chain organizations are actively managing tariff impacts. He noted that projects already in flight are 'pretty well shielded' by contract structures. While new projects have more exposure, he does not currently see a material impact on the project portfolio, economics, or investment decisions. He also expressed confidence that governments are sensitive to the energy sector's critical role.

Bob Brackett asked about the final investment decision (FID) cadence for major LNG projects like Papua LNG and Rovuma, and what conditions are necessary to move forward.

Answer

CEO Darren Woods emphasized that the primary criteria for all projects are a low cost of supply and advantaged returns, which are achieved through their project and technology organizations. While geopolitical stability is managed, it is not the largest variable. He confirmed they are targeting a late 2025 FID for PNG and a 2026 FID for Rovuma.

Bob Brackett asked about the Final Investment Decision (FID) timing for major LNG projects like Papua LNG and Rovuma, and what conditions are necessary to sanction these multi-decade assets.

Answer

CEO Darren Woods emphasized that the primary criterion for moving forward is ensuring the projects are low-cost supply sources that can generate advantaged returns throughout market cycles. While local stability is managed, it is not the largest variable. He confirmed they are targeting a late 2025 FID for PNG and a 2026 FID for Rovuma.

Bob Brackett asked about the drivers behind the US production targets, particularly the leach initiatives delivering refined copper, and whether tariffs or unit economics are the primary focus. He also inquired about the increased conviction in the 600 million pound leach target.

Answer

Kathleen Quirk, President and CEO, emphasized the low incremental cost and capital for leach pounds as a significant value creation opportunity, noting the Bagdad project requires a $4 average copper price. She clarified that tariffs are not driving investment, but rather absolute prices and delivering low operating costs. Cory Stevens, President, SVP and COO, Americas, detailed progress on heat and additive trials, including a new chemical heat project at Chino, which increases conviction in scaling leach. Richard Adkerson, Chairman of the Board, added that substitution would occur in the context of higher copper prices.

Bob Brackett asked about Freeport's U.S. copper production targets, the potential for further expansion, and whether these targets are driven by unit economics or potential copper tariffs. He also inquired if the company's conviction in the $600 million leach target has increased given recent additive and heat work.

Answer

Kathleen Quirk, President and CEO, highlighted the low incremental cost and capital requirements of leach initiatives as a significant value creation opportunity, not driven by tariffs. She also discussed the Bagdad project's justification at a $4.00 per pound copper price. Quirk confirmed increased conviction in the leach target due to successful field deployment of additives and advanced heap projects, with 2026 being a pivotal year for testing heat and additives. Cory Stevens, from management, added details on heat initiatives at Morenci, El Abra, and Chino.

Bob Brackett inquired about adjustments to Freeport-McMoRan's mine planning forecast, specifically regarding the sequencing of PB1N and PB4-7 operations, and whether the current plan incorporates new mitigation technologies like hammer drilling for mud zone drainage.

Answer

Kathleen Quirk (President and CEO) and Mark Johnson (President and COO, Freeport-McMoRan Indonesia) clarified that the long-term plan's primary difference is the sequencing of PB1 within PB1C and PB1 North, with other mine portions progressing as previously forecast. Mark Johnson added that hammer drills, capable of 200 meters a day, could be a "game changer" for accessing and draining the mud zone from 400 meters below the pit surface.

Bob Brackett with Bernstein Research inquired about adjustments to the current mine planning forecast, specifically regarding the sequencing of PB1N and PB4-7 operations, and the potential for rapid mitigation using hammer drilling technology.

Answer

Kathleen Quirk, President and CEO, and Mark Johnson, President and COO of Freeport-McMoRan Indonesia, clarified that the long-term plan primarily impacts the sequencing of PB1 within PB1C and PB1 North, with other mine portions progressing as previously forecast. Mark Johnson highlighted that hammer drills, capable of drilling 200 meters a day, could be a significant "game changer" for accessing and draining the mud zone.

Asked for an update on the Lone Star oxide expansion project and the status of sulfide leaching trials, including the partnership with Jetti Resources.

Answer

The Safford/Lone Star oxide project is nearly complete and performing well. For sulfide leaching, the company is primarily focused on its own internal initiatives, including using AI to develop additives, and is planning a commercial-scale deployment at Morenci. The trial with Jetti at Bagdad had 'mixed results,' and the focus remains on in-house development to retain the economics.

Bob Brackett asked for an update on the Lone Star oxide expansion and the progress of the Jetti Resources sulfide leaching trial at Bagdad.

Answer

President and CEO Kathleen Quirk reported that the Safford/Lone Star oxide project is essentially complete and performing well. Regarding Jetti, she noted the trial had mixed results. Executive Cory Stevens added that Freeport is highly focused on its own internal additives program, using AI to develop candidates, with a commercial-scale deployment planned at Morenci soon.

Bob Brackett questioned if the language regarding the IUPK extension filing in Indonesia had become more vague compared to the prior quarter and asked for details on the scale of the opportunity outlined in the new Safford Lone Star pre-feasibility study.

Answer

Chairman Richard Adkerson explained that the presidential transition in Indonesia delayed the IUPK extension process but affirmed the company's confidence that it will be secured under the new government. President and CEO Kathleen Quirk detailed that the Safford Lone Star project has the potential to more than double current production to over 600 million pounds of copper per year, positioning it as a future cornerstone asset with a potentially faster development timeline than other projects due to a more straightforward permitting path.

Bob Brackett at Bernstein Research inquired about Venture Global's current relationship with its Plaquemines counterparties, specifically whether they are aligned with the company's pre-COD and post-COD operational framework, drawing a comparison to the arbitration history at Calcasieu Pass.

Answer

CEO Michael Sabel affirmed a great relationship with Plaquemines customers, stating that the company has reconfirmed the original schedule for the first window period (month 54) for Plaquemines. He highlighted the remarkable achievement of a 54-month construction timeline for such a large project, despite still relying on temporary power and having significant work remaining before substantial completion and COD. He emphasized the billions of dollars of extra investment made into Plaquemines to maintain this record-setting schedule, placing the company in a very solid position.

Bob Brackett inquired about Venture Global's relationship with current Plaquemines counterparties, given the arbitration history at Calcasieu Pass, and their alignment with the pre-COD/post-COD operational model.

Answer

CEO Michael Sabel stated they have a great relationship with customers, reconfirming Plaquemines is on its original schedule for the first window period (month 54). He highlighted the continued use of temporary power and remaining work for substantial completion and lender reliability testing, expressing confidence in achieving the original schedule, supported by billions of dollars of extra investment to maintain the record-setting pace.

Bob Brackett inquired about the macro environment ConocoPhillips envisions for its 2026 production guide of 0-2% growth, especially with WTI below $60, and how this macro view informs the capital and production guidance.

Answer

Ryan Lance, Chairman and CEO, stated that production is an output of their plans, with a constant level-loaded scope in the Lower 48. He noted a supportive macro view, with WTI around $60, anticipating some downside pressure into early next year due to inventory builds. He emphasized the company's balance sheet flexibility to fund programs or adjust CapEx, and a constructive medium-to-longer-term outlook with continued demand growth, supporting the 0-2% production target for 2026.

Bob Brackett asked about the macro world ConocoPhillips envisions for 2026, given the 0%-2% production guide and WTI below $60, and how this informs the capital and production guidance.

Answer

Ryan Lance (Chairman and CEO) stated that production is an output of their plans, with a constant level-loaded scope in the Lower 48. He noted the $60 WTI planning assumption, anticipating some downside pressure in late 2025 and early 2026 due to inventory builds. Lance emphasized the company's balance sheet flexibility to fund programs or adjust CapEx. He expressed a constructive medium-to-longer-term macro view, expecting 1 million barrels/day demand growth, and modest unconventional growth. The 0%-2% guide reflects the near-term macro and the company's flexibility.

Bob Brackett from Bernstein asked for a comparison of the company's global LNG strategy against the emerging opportunity to supply natural gas for U.S. data center power demand.

Answer

Chairman and CEO Ryan Lance acknowledged that the company is studying data center opportunities and receiving inbounds, given its large natural gas production, commercial power desk, and land position. However, he framed the primary strategy as being bullish on North American gas volumes but bearish on domestic price, making LNG an attractive way to move molecules to higher-valued markets. While power demand is a potential growth area, any investment must compete for capital and fit the company's established financial framework.

Bob Brackett sought the company's perspective on the anticipated 'wave of global LNG' and whether a significant surge in liquefaction capacity is likely to materialize in the coming years.

Answer

Chairman and CEO Ryan Lance acknowledged that while projections show a potential supply overhang later in the decade, project FIDs and timelines often shift to the right. He emphasized that ConocoPhillips is investing for the long-term based on bullish demand growth over decades and that its full value chain strategy, including liquefaction, shipping, and regasification, is designed to navigate market volatility.

Bob Brackett asked about EQT's appetite to explore adjacencies like gas trading, storage, and power marketing, and the synergies with its LNG business.

Answer

Jeremy Knop, CFO, stated EQT focuses on optimizing its production value rather than speculative trading, noting that a minimum of 4 MTPA of LNG capacity is needed to be competitive, which EQT has now achieved. Toby Rice, President and CEO, added that EQT's strategic focus includes improving the reliability of energy systems, with trading contributing to this goal.

Bob Brackett asked about EQT's appetite to explore adjacencies like gas trading, gas storage, and power marketing, given its position as the number two gas marketer in the U.S.

Answer

Jeremy Knop (CFO, EQT) stated that EQT focuses on optimizing its production value rather than speculative trading, aiming for a minimum of 4 Mtpa of LNG capacity to be competitive. Toby Rice (President and CEO, EQT) emphasized EQT's strategic focus on making energy more reliable, which includes improving energy systems and trading functions.

Bob Brackett of Bernstein Research sought clarification on the base decline rate for the Jubilee field, asking if 15-20% was a better estimate than the top-down 40% figure. He also inquired about any changes to fiscal terms or work commitments in the Ghana license extension MOU.

Answer

Chairman & CEO Andrew Inglis confirmed that a 15-20% base decline, managed by 3-4 wells per year, is the correct way to view the Jubilee field long-term. Regarding the license extension, Inglis stated it is a 'win-win' with no changes to fiscal terms under existing law. The agreement includes a commitment to increase gas volumes with a small price discount and to drill up to 20 wells, enabling long-term investment.

Bob Brackett asked about the Tiberius project in the Gulf of Mexico, specifically whether the new lower-cost development plan is being driven by evolving policy from the Department of the Interior.

Answer

CEO Andrew Inglis clarified that the optimization of the Tiberius development plan is not driven by specific policy changes. Instead, it is a result of leveraging new Ocean Bottom Node (OBN) seismic technology for better imaging and collaborative engineering work with partner Oxy to optimize a tie-back to the existing Lucious facility.

Bob Brackett inquired about the potential 2025 capital implications of a successful Akeng Deep well and asked about the strategy for the Tiberius project's farm-down process given the delayed Final Investment Decision (FID).

Answer

CEO Andrew Inglis clarified that a success at Akeng Deep would primarily impact capital allocation from 2026 onwards, allowing the company to high-grade opportunities without rushing in 2025. Regarding Tiberius, he stated the intent remains to farm-down to a ~40% working interest, and the deferral is about pacing growth, not changing the project strategy.

Bob Brackett pointed out that annualizing Q1 EBITDA would lead to a number well above the full-year guidance and asked for more color on the key drivers causing the expected deceleration.

Answer

EVP and CFO Zach Davis clarified that annualizing Q1 is misleading due to strong seasonality, with Q1 and Q4 being the highest production quarters. He cited three key factors for the difference: higher realized margins in Q1 (over $8) versus the rest of the year ($5-$6), planned major maintenance in the summer making Q2 the lowest production quarter, and the gradual ramp-up of Stage 3 trains.

Bob Brackett noted that the 2025 production guide for Sabine Pass appears flat despite planned major maintenance and asked for clarification on the maintenance scale.

Answer

EVP and CCO Anatol Feygin clarified that the planned major maintenance at Sabine Pass trains 3 and 4 will be longer in 2025 than in 2024. However, the impact is offset by the benefits of previously completed debottlenecking projects, allowing the existing nine-train platform to maintain its approximate 45 million-tonne run rate.

Bob Brackett inquired about Westinghouse's relationship with China following its announcement of 10 new reactors, especially amidst ongoing trade disputes. He also asked about the potential for this business to impact the trade balance and the timing for new reactor announcements to become capital commitments.

Answer

CEO Tim Gitzel affirmed that both Westinghouse and Cameco have strong, enduring business-to-business relationships with China, which is a critical driver of future nuclear demand. CFO Grant Isaac added that energy deals are compelling in geopolitical discussions and that Westinghouse's involvement in China, through contracts for instrumentation and fabrication, benefits the U.S. He also highlighted that China's success in building AP1000s validates the technology's efficiency.

Requested preliminary details from the upcoming Lumwana and Reko Diq feasibility studies, and an inquiry into the key risks for these projects.

Answer

The Lumwana expansion remains robust (economic at $3/lb copper), with a focus on mining efficiency. The Reko Diq project's economics are in line with original assumptions, despite some design changes like incorporating rail. More details will be shared in upcoming investor events.