Genesis Energy LP (GEL) 2024 Q4 法說會逐字稿

Greetings and welcome to Genesis Energy Fourth Quarter 2024 earnings conference call. (Operator Instructions)

問候並歡迎參加 Genesis Energy 2024 年第四季財報電話會議。（操作員指令）

I would now like to turn the conference over to your host, Dwayne Morley, Vice President, Investor Relations.

現在，我想將會議交給主持人、投資者關係副總裁 Dwayne Morley。

Thank you. You may begin.

謝謝。你可以開始了。

Good morning and welcome to the 2024 Fourth Quarter conference call for Genesis Energy. Genesis Energy has 4 business segments. The offshore pipeline transportation segment is engaged in providing the critical infrastructure to move oil produced from the long-lived world-class reservoirs in the deep water Gulf of America to onshore refining centers.

早安，歡迎參加 Genesis Energy 2024 年第四季電話會議。Genesis Energy 有 4 個業務部門。海上管道運輸部門致力於提供關鍵基礎設施，將美國灣深水區長期存在的世界級油藏所產的石油運送至陸上煉油中心。

The soda and sulfur services segment includes Trona and Trona-based exploring, mining, processing, producing, marketing, and selling activities.

蘇打和硫磺服務部門包括天然鹼和基於天然鹼的勘探、開採、加工、生產、行銷和銷售活動。

As well as the processing of sour gas streams to remove sulfur at refining operations, the onshore facilities and transport transportation segment is engaged in the transportation, handling, blending, storage, and supply of energy products, including crude oil and refined products. The marine transportation segment is engaged in the maritime transportation of primarily refined petroleum products. Genesis's operations are primarily located within Wyoming, the Gulf Coast states, and the Gulf of America.

除在煉油作業中處理酸性氣流以去除硫以外，陸上設施和運輸部門還從事能源產品（包括原油和精煉產品）的運輸、裝卸、混合、儲存和供應。海上運輸部門主要從事精煉石油產品的海上運輸。Genesis 的業務主要位於懷俄明州、墨西哥灣沿岸各州和美國灣。

During this conference call, management may be making forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. The law provides safe harbor protection to encourage companies to provide forward-looking information. Genesis intends to avail itself of the safe harbor provisions and directs you to its most recently filed and future filings Securities Exchange Commission.

在本次電話會議中，管理階層可能會根據《1933 年證券法》和《1934 年證券交易法》做出前瞻性聲明。該法提供安全港保護，以鼓勵公司提供前瞻性資訊。Genesis 打算利用安全港條款，並指導您查看其最近提交的和未來的證券交易委員會文件。

We also encourage you to visit our website at genesisenergy.com, where a copy of the press release, we issued this morning is located. Press release also presents a reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures.

我們也鼓勵您造訪我們的網站 genesisenergy.com，那裡有我們今天早上發布的新聞稿副本。新聞稿也提供了非公認會計準則財務指標與最具可比性的公認會計準則財務指標的對帳表。

At this time, I'd like to introduce Grant E. Sims, CEO of Genesis Energy LP. Mr. Sims will be joined by Kristen O. Jesulaitis, Chief Financial Officer and Chief Legal Officer, Ryan S. Sims, President, Chief Commercial Officer, and Louie V. Nicol Chief Accounting Officer.

現在，我想介紹 Genesis Energy LP 的執行長 Grant E. Sims。與 Sims 先生一同出席的還有財務長兼首席法律官 Kristen O. Jesulaitis、總裁兼首席商務官 Ryan S. Sims 和 Louie V.Nicol 首席會計官。

Thanks. Good morning to everyone and thank you for listening to the call.

謝謝。大家早安，感謝大家收聽電話會議。

As we mentioned in our earnings release this morning, we are now just a few short months away from reaching the inflection point when we will complete our current major capital spending program, be a short time away from a notable step change and realized segment margin, and most importantly, be in a position to generate cash from operations in excess of the cash costs of running and sustaining our businesses.

正如我們在今天早上的收益報告中提到的那樣，我們現在距離達到轉折點只有短短幾個月的時間，屆時我們將完成當前的主要資本支出計劃，不久之後我們將實現顯著的變革和實現分部利潤率，最重要的是，我們能夠從運營中產生超過運營和維持業務的現金成本的現金。

Needless to say, this moment has been a long time coming, and while we've had a few hiccups along the way, we remain on schedule. I get more and more encouraged with the long term prospects of Genesis as each day passes. Instead of dwelling on what could have been in 2024, I'd rather focus my comments here today on what lies ahead for the remainder of 2025 and beyond.

毋庸置疑，這一刻已經等待了很長時間，儘管我們一路上遇到了一些小困難，但我們仍在按計劃進行。隨著每一天的過去，我對 Genesis 的長期前景越來越感到鼓舞。今天，我不想糾結於 2024 年可能發生的事情，而是更願意把重點放在 2025 年剩餘時間及以後的事情上。

We remain encouraged with what is in front of us and are confident we are well positioned to deliver meaningful sequential earnings growth over 2024, driven primarily by mid-year startup of our new contracted offshore volumes and strong structural tailwinds in our marine segment, even if we see static performance from our other two segments this year relative to last.

我們對眼前的機會感到鼓舞，並有信心在 2024 年實現有意義的連續盈利增長，這主要得益於我們今年新簽訂的海上合同量的啟動以及海洋部門強勁的結構性順風，即使我們看到今年其他兩個部門的表現與去年相比處於靜態。

Our offshore segment is expected to see significant growth in offshore volumes and segment margins associated with our two new contracted developments, Shenandoah and Salamanca. They remain on schedule with first production from both developments expected in the Second quarter.

隨著我們兩個新簽訂的合約開發項目 Shenandoah 和 Salamanca，我們的海上部門預計將實現海上量和部門利潤率的大幅增長。一切都按照計畫進行，預計兩個開發案的首批投產將在第二季完成。

Based on recent conversations with both operators, we could see volumes from each development ramp very quickly too, if not above their originally expected high cases. When combined with the eventual resumption of the volumes from the fields that were negatively impacted last year, which we are now told should occur over the next several months, we should be positioned to deliver upwards of 20% sequential growth in our offshore pipeline transportation segment in 2025.

根據最近與兩家營運商的對話，我們可以很快看到每個開發坡道的產量，即使不超過最初預期的高產量。結合去年受到負面影響的油田最終恢復產量（目前我們被告知應該會在未來幾個月內發生）這一情況，我們應該能夠在 2025 年實現海上管道運輸部門連續 20% 以上的增長。

Our marine transportation segment is again expected to deliver record results in 2025, driven in large part by more days on the water, as they say, for our offshore fleet relative to 2024 and steady increasing day rates across all classes of our vessels. The macros marine remains constructed. We see reasonably steady demand. At the same time, we continue to see net supply reductions in the market driven by the limited number of new barges being constructed while more and more older barges are being retired.

我們的海上運輸部門預計將在 2025 年再次創下創紀錄的業績，這在很大程度上是由於我們的近海船隊在水上航行的時間比 2024 年更長，而且我們所有級別船隻的日費率都在穩步提高。宏海洋遺跡建造完成。我們看到需求相當穩定。同時，我們繼續看到市場淨供應量減少，因為建造的新駁船數量有限，而越來越多的老駁船被退役。

We believe these structural indicators will persist in marine for quite some time and should support steady to marginally improving financial performance from our marine transportation segment throughout 2025. As we sit here today, we expect the challenging macro conditions in the soda ash market we saw in the back half of last year to persist in 2025, at least in the early part of the year.

我們相信，這些結構性指標將在海運領域持續相當長一段時間，並將支持我們的海運部門在2025年實現財務業績的穩步至小幅改善。今天，我們預計，去年下半年純鹼市場面臨的嚴峻宏觀情勢將持續到 2025 年，至少在年初是如此。

The combination of a well-supplied market. In a mixed demand picture outside China is expected to keep a lid on soda ash prices, especially in our export markets. While current prices are undoubtedly below the cash cost of high costs synthetic producers, particularly in China, we expect the market continues to need a combination of further supply rationalizations and a resumption of historical demand growth to ultimately help prices recover.

供應充足的市場的組合。在中國以外地區需求情勢複雜的情況下，預計將抑制純鹼價格，尤其是在我們的出口市場。儘管當前價格無疑低於高成本合成生產商的現金成本，尤其是在中國，但我們預計市場仍需要進一步的供應合理化和恢復歷史需求成長，才能最終幫助價格回升。

I'll give a little more color later in my prepared remarks, but we are encouraged that these necessary supply reductions are starting to occur, and they will no doubt help tighten the market as we move through this year and into next. Given this market backdrop, however, and despite an improving operating performance and implementing certain cost savings initiatives, we expect the segment margin from our Soda ash business to be at or near what we generated in 2024.

我稍後會在準備好的發言中對此進行更詳細的闡述，但我們感到鼓舞的是，這些必要的供應減少已開始發生，毫無疑問，隨著我們度過今年和明年，它們將有助於收緊市場。然而，鑑於這樣的市場背景，儘管經營業績不斷改善並實施了某些成本節約舉措，我們預計純鹼業務的分部利潤率將達到或接近 2024 年的水平。

Kind of a sideways year. Until we get to 2026, when we would otherwise expect prices to recover and more closely reflect at least the cash cost of the marginal suppliers. Similarly, we expect our legacy refinery services business and our onshore facilities and transportation segment to also perform in line with their performance last year.

真是跌宕起伏的一年。直到 2026 年，我們預計價格將會回升並更緊密地反映邊際供應商的現金成本。同樣，我們預計我們的傳統煉油服務業務以及陸上設施和運輸部門的表現也將與去年保持一致。

While we would rather see all of our businesses sitting on all cylinders, our path forward remains crystal clear. Even with this anticipated sideways action year over year in a couple of segments in 2025, we will begin to harvest accelerating amounts of cash above and beyond the cash cost to operate and sustain our business.

雖然我們希望看到所有業務都全速運轉，但我們前進的道路仍然十分清晰。即使預計 2025 年幾個細分市場將出現同比橫向走勢，我們仍將開始收穫超過營運和維持業務的現金成本的大量現金。

And we will use to strengthen and simplify our capital structure. We are committed to not pursuing any capital intensive projects for the foreseeable future. We expect to use this excess cash flow to pay down debt in absolute terms, opportunistically redeem or retire our high cost convertible preferred.

並且我們將用來加強和簡化我們的資本結構。我們承諾在可預見的未來不會進行任何資本密集型項目。我們期望利用這些多餘的現金流來絕對償還債務，並伺機贖回或退出我們高成本的可轉換優先股。

Both of which will lower the cash costs of running and sustaining our business. And look to return increasing amounts of capital to our unit holders in one form or another, all while managing our bank calculated leverage ratio to our long term target. We remain confident that the path we are on will allow us in the years ahead to deliver long term value to everyone in the capital.

這兩者都將降低營運和維持我們業務的現金成本。並尋求以某種形式向我們的單位持有人返還越來越多的資本，同時將我們銀行計算的槓桿率管理到我們的長期目標。我們堅信，我們所走的道路將使我們能夠在未來幾年為首都的每個人帶來長期價值。

With that, I'll touch briefly on our individual business segments. As mentioned in our earnings release, several of our producer customers continue to experience mechanical issues that are affecting multiple fields that are connected to our offshore infrastructure. We can now report that 3 out of the total of only 21 available deep water rigs working in the Gulf of America are now actively working on restoring production from these affected wells.

接下來我將簡要介紹我們各自的業務部門。正如我們在收益報告中提到的那樣，我們的一些生產商客戶繼續遇到機械問題，這些問題影響了與我們的海上基礎設施相連的多個油田。我們現在能夠報告的是，在美國灣僅剩的21座深水鑽井平台中，有3座正在積極恢復這些受影響油井的產量。

We are told by the authors that such remedial intervention activities should be completed over the next several months. As we have mentioned in the past, the affected producers and operators continue to reiterate they expect no long-term negative impacts to the underlying reservoirs, and they fully expect volumes to return to levels consistent to what they were producing prior to the mechanical issues cropping up.

作者告訴我們，此類補救幹預活動應在接下來的幾個月內完成。正如我們過去提到的那樣，受影響的生產商和運營商繼續重申，他們預計底層油藏不會受到長期負面影響，並且他們完全預計產量將恢復到機械問題出現之前的生產水平。

More importantly, our offshore construction projects are expected to be totally complete in the next few months. Our team is preparing to start the final stages of construction, which will primarily consist of lifting the sink pipeline off the sea floor and connecting it to the Shenandoah floating production system once it is installed at its final location.

更重要的是，我們的海上建設項目預計將在未來幾個月內全面完工。我們的團隊正準備開始最後的施工階段，主要包括將沉管從海底打撈出來，並在最終安裝到位後將其連接到 Shenandoah 浮式生產系統。

The Shenandoah FPU set sail from South Korea in mid December and recently arrived in Ingleside, Texas, thus completing its 18,000 mile journey in less than two months. After completing its final outfitting and safety checks, it is expected to move to its final location in advance of first production in the Second quarter.

謝南多厄浮式防守艦艇號於12月中旬從韓國啟航，最近抵達德克薩斯州英格爾賽德，從而在不到兩個月的時間內完成了18,000英里的旅程。在完成最後的組裝和安全檢查後，預計將在第二季首次生產之前移至最終位置。

Similarly, the Salamanca production facility is also nearing completion. In fact, I visited the Salamanca FPU. Earlier this week for its christening and can confirm it is very close to being complete and is really quite a sight to see. I'm confident the Salamanca FPU will long be a great case study of the benefits of repurposing an existing offshore platform to serve as a new production facility that will likely last for many more decades to come.

同樣，薩拉曼卡生產設施也即將完工。事實上，我參觀了薩拉曼卡FPU。本週早些時候舉行了命名儀式，可以確認它已經非常接近完工，而且確實值得一看。我相信，薩拉曼卡浮式生產設施將成為將現有海上平台重新用作新生產設施的一個很好的案例，而且這種新生產設施很可能將在未來幾十年繼續使用。

The carbon footprint of the refurbished facility is estimated to be some 70% less than a new bill. Was cheaper than a new build and importantly accelerated the date of first production by some 12 plus months. The Salamanca FPU-2 will be setting sail from South Texas to its final location in the Gulf of America in the very near future and remains on schedule for first production in the middle of the year.

據估計，翻新設施的碳足跡將比新設施減少約 70%。比新建更便宜，而且重要的是將首次生產日期提前了 12 個多月。薩拉曼卡 FPU-2 號將在不久的將來從南德克薩斯州啟航前往美國灣的最終目的地，並按計劃於年中首次投入生產。

We continue to believe these two new stand-alone production facilities and their combined almost 200,000 barrels of oil per day of incremental production handling capacity will rent very quickly and will likely reach their anticipated production levels by the end of the year, if not significantly sooner.

我們仍然相信，這兩座新的獨立生產設施及其合計每天近20萬桶石油的增量生產處理能力將很快出租，並可能在今年年底前達到預期的生產水平，甚至可能更快。

In both cases, the operators continue to anticipate producing at rates materially higher than our taker pay levels or perhaps even higher than their original high-end internal expectations when they sanction the projects. As we have mentioned in the past, these two new floating production facilities are also expected to serve as host platforms for additional future subsea developments or tie back opportunities which could sustain or increase these cash flows to us for years and years into the future.

在這兩種情況下，營運商在批准專案時都繼續預期產量將大大高於我們的接受者支付水平，甚至可能高於他們最初的高端內部預期。正如我們過去提到的那樣，這兩個新的浮式生產設施也有望作為未來更多海底開發的主機平台，或帶來可能在未來幾年內維持或增加我們現金流的機會。

In addition to the monument field, which is sanctioned, which is a sanctioned sub-sea tie back to the Shenandoah FU that is expected to start production in the Fourth quarter of 2026. Beacon announced the operator announced in December that it sanctioned the next phase of development at Shenandoah, known as Shenandoah Phase 2.

除了已獲批准的紀念性油田外，該油田是一條已獲批准的海底油田，與 Shenandoah FU 相連，預計將於 2026 年第四季開始生產。Beacon 宣布，該營運商於 12 月宣布批准 Shenandoah 的下一階段開發，即 Shenandoah 第二階段。

Activities associated with this phase to include the drilling and completion of 2 additional wells in the Shenandoah field. Beacon estimates that the activities from Shenandoah Phase 2 will be conducted between 2025 and 2028 and will add approximately 110 million BOE equivalent P-50 reserves.

與此階段相關的活動包括在 Shenandoah 油田鑽探和完井另外 2 口井。Beacon 估計 Shenandoah 第二階段的活動將在 2025 年至 2028 年期間進行，並將增加約 1.1 億桶油當量的 P-50 儲量。

Additionally, Beacon and its partners are advancing plans to facilitate the development of the Shenandoah South Discovery, located in Walker Ridge 95 and water depths ranging from 5,800 to 6,000 feet. The field's proximity to the Shenandoah FPU will enable a cost efficient sub-sea tieback development to be accomplished by a 3 mile flow line and dedicated riser connection to the Shenandoah FPU.

此外，Beacon 及其合作夥伴正在推進計劃，促進位於 Walker Ridge 95、水深 5,800 至 6,000 英尺的 Shenandoah South Discovery 的開發。該油田靠近 Shenandoah FPU，可透過 3 英里長的流水線和專用立管連接到 Shenandoah FPU，實現具有成本效益的海底回接開發。

Shenandoah South is expected to include the drilling and completion of two wells with initial production from the first well expected to occur in the Second quarter of 2028. Beacon estimates a total of 74 million BOE equivalent of 50 reserves for Shenandoah South.

Shenandoah South 預計將鑽探和完井兩口井，第一口井預計將於 2028 年第二季投產。Beacon 估計 Shenandoah South 的儲量總量為 7,400 萬桶油當量，相當於 50 個儲量。

While Beacon and its partners have not yet made their final investment decision on the Shenandoah South project, it is yet another example of the multitude of opportunities that exist once a new floating production unit is installed and connected to our offshore infrastructure.

雖然 Beacon 及其合作夥伴尚未對 Shenandoah South 項目做出最終投資決定，但它是安裝新的浮動生產裝置並將其連接到我們的海上基礎設施後存在的眾多機會的又一個例子。

When taken together, the Shenandoah Phase 2 monument and Shenandoah South developments are estimated to be able to produce nearly 600 million BOE P-50 reserves, with 100% of the oil production dedicated to our new sync lateral and expanded [hos] pipeline.

綜合起來，謝南多厄二期工程和謝南多厄南部開發項目估計能夠生產近 6 億桶油當量的 P-50 儲量，其中 100% 的石油產量將用於我們的新同步側向管道和擴建的 [hos] 管道。

Truly a remarkable opportunity set for the next decade around this one new asset connected to our offshore infrastructure. Turning now to our soda and sulfur services segment, I'm pleased to report that the operating issues we experienced at our West Veco production facility in 2024 are now behind us.

這確實為未來十年圍繞著這與我們的海上基礎設施相關的新資產創造了一個難得的機會。現在談到我們的蘇打和硫磺服務部門，我很高興地報告，我們在 2024 年在 West Veco 生產設施遇到的營運問題現在已經過去了。

And at our ranger facility has recently been performing at or above its design capacity. Our team is constantly looking for opportunities to optimize our operating performance, and I'm confident these efforts will contribute towards more steady production levels moving forward. As we mentioned last quarter and in response to current market conditions, we have also recently made a concerted effort to focus on the cost side of our business.

我們的護林員設施最近的運作能力已達到或超過了其設計能力。我們的團隊一直在尋找優化營運績效的機會，我相信這些努力將有助於實現未來更穩定的生產水準。正如我們上個季度提到的，為了應對當前的市場狀況，我們最近也做出了一致努力，重點關注業務的成本方面。

As a result of these efforts, our team has identified numerous opportunities, and we have since started to implement several initiatives to reduce our fixed and marginal operating costs in the business. We continue to believe that the combination of improved operating performance and a lower overall cost structure will allow us to meaningfully benefit when the broader market fundamentals improve, which they will, and they always do.

透過這些努力，我們的團隊發現了許多機會，我們已經開始實施多項舉措，以降低業務中的固定和邊際營運成本。我們始終相信，當更廣泛的市場基本面改善時，改善的經營績效和較低的整體成本結構將使我們獲得顯著的利益，而市場基本面肯定會改善，而且總是會改善。

As mentioned in our release, the global soda ash market remains relatively consistent with the last quarter, with global demand being mixed and most markets remaining well supplied. Furthermore, inventories in China and the availability of exports therefrom remain elevated from recent lows.

正如我們在新聞稿中提到的那樣，全球純鹼市場與上一季保持相對一致，全球需求混合，大多數市場供應充足。此外，中國的庫存和出口供應量仍高於近期的低點。

In the short term, the market needs more high cost and environmentally inferior synthetic production to come out of the market. Having said that, we have recently started to see some synthetic supply be shuttered, with the last remaining synthetic soda ash production facility in the United Kingdom ceasing operations at the end of last just last month, January, reducing global supply by approximately 220,000 tons per year.

短期內，市場需要更多成本高、環境劣質的合成產品退出市場。話雖如此，我們最近開始看到一些合成鹼供應被關閉，英國最後剩下的合成純鹼生產設施於上個月（1 月）月底停止運營，導致全球供應量每年減少約 22 萬噸。

Late last year, another producer announced it was reducing production by approximately 300,000 tons per year from its synthetic production facility in Spain. And just yesterday, A different synthetic producer announced it was suspending production from a 700,000 ton a year facility in Poland. In discussing such decision, it also said it would be forced to consider additional production cuts at other facilities it operates in the EU if market conditions don't soon improve.

去年年底，另一家生產商宣布其位於西班牙的合成生產設施將每年減產約 30 萬噸。就在昨天，另一家合成橡膠生產商宣布暫停其位於波蘭的年產 70 萬噸的工廠的生產。在討論這項決定時，該公司還表示，如果市場狀況不能很快改善，它將被迫考慮進一步削減其在歐盟運營的其他工廠的產量。

As more and more of this high cost synthetic supply is taken offline. We would expect to move closer to a more balanced market where soda ash prices could improve. Everything else the same. We would reasonably expect marginal improvement in prices as we progress through 2025, but almost certainly based on historical market behavior and the supplier rationalization we are beginning to see certainly in 2026 and beyond.

隨著越來越多的高成本合成供應被下線。我們預期市場更加平衡，純鹼價格能夠上漲。其它一切相同。我們有理由預計，到 2025 年，價格將會出現小幅上漲，但根據歷史市場行為和供應商合理化，我們幾乎可以肯定，2026 年及以後的價格肯定會上漲。

Regardless of when these events occur, we are confident as one of the world's lowest cost producers that the steps we are taking in our operations and on the cost side will allow us to meaningfully benefit from any such recovery in soda ash prices in the future.

無論這些事件何時發生，作為世界上成本最低的生產商之一，我們有信心，我們在營運和成本方面採取的措施將使我們從未來純鹼價格的任何復甦中獲得重大利益。

Our marine transportation segment performed in line with our expectations as the broader market conditions remain constructed, and we operated with utilization rates at or near 100% of practical available capacity for all classes of our Jones Act vessels. We continue to see reasonably steady demand for all classes of our vessels. At the same time, there has been limited, if not realistically zero net additions to the market.

由於整體市場狀況持續良好，我們的海上運輸部門表現符合預期，且我們所有級別的瓊斯法案船舶的利用率均達到或接近 100％ 的實際可用容量。我們繼續看到我們各類船舶的需求相當穩定。同時，市場淨新增量有限，甚至實際上為零。

As older vessels continue to be retired and a limited number of new barges have been built, this market dynamic doesn't turn around quickly. To conclude We could not be more excited about 2025 and beyond and remain fully committed to reaching that special inflection point in just a few months where we stop spending growth capital, start harvesting significant and growing cash flows in excess of the cash costs of running and sustaining our business.

由於老舊船舶不斷退役，且新駁船數量有限，這種市場態勢不會很快好轉。總而言之，我們對 2025 年及以後的目標感到無比興奮，並將繼續全力致力於在短短幾個月內達到那個特殊的轉折點，屆時我們不再花費增長資本，開始收穫超過運營和維持業務的現金成本的可觀且不斷增長的現金流。

Along those lines and based upon what we know today, we believe adjusted EBITDA at 2025 will be around $700 million. And in 2026, even if there is no meaningful improvement in our soda ash business, it could be around $800 million. If there is a recovery in soda ash prices in 2026, which, as I mentioned earlier, could reasonably expected.

按照這個思路並根據我們今天所掌握的信息，我們認為 2025 年的調整後 EBITDA 將達到 7 億美元左右。到 2026 年，即使我們的純鹼業務沒有顯著改善，其收入也可能達到 8 億美元左右。如果 2026 年純鹼價格出現回升，正如我之前提到的，這是可以合理預期的。

Based on historical market behavior and shutting in of high cost synthetic production, that number could turn out to be conservative. The cash cost of running and sustaining our business currently is $600 billion to $625 billion per year. As we use the excess cash flow. We will begin in generating later this year and accelerates in 2026 and beyond as we use it to pay down debt and periodically redeem high costs preferred. That cash cost of running and sustaining the business will decrease.

根據歷史市場行為和高成本合成生產的關閉，這個數字可能有些保守。目前營運和維持我們業務的現金成本為每年 6000 億至 6250 億美元。因為我們使用了多餘的現金流。我們將在今年稍後開始發電，並在 2026 年及以後加速發電，因為我們將用它來償還債務並定期贖回高成本優先股。營運和維持業務的現金成本將會降低。

That will give us even more flexibility to pay off even more debt, redeem even more preferred securities, and return even more capital to our unit holders in one form or another, all while managing our bank calculated leverage ratio to our long term targets. Finally, I'd like to say that the management team and the board of directors remain steadfast in our commitment to building a long-term value for all our stakeholders regardless of where you are in the capital structure.

這將使我們有更大的靈活性來償還更多的債務，贖回更多的優先證券，並以某種形式向我們的單位持有人返還更多的資本，同時將我們銀行計算的槓桿率管理到我們的長期目標。最後，我想說的是，管理團隊和董事會始終堅定不移地致力於為所有利害關係人創造長期價值，無論您處於資本結構的哪個位置。

We believe the decisions we are making reflect this commitment and our confidence and genesis moving forward. I would once again like to recognize our entire workforce for their individual efforts and unwavering commitment to safe and responsible operations.

我們相信，我們所做的決定反映了這項承諾以及我們前進的信心和動力。我再次讚揚我們全體員工的個人努力以及對安全和負責任的營運的堅定承諾。

I'm extremely proud to be associated with each and every one of them. With that, I'll turn it back to the moderator for questions.

我非常自豪能夠與他們每一個人有聯繫。說完這些，我將把話題轉回給主持人，以便大家提問。

(Operator Instructions)

（操作員指令）

Michael Blum, Wells Fargo.

富國銀行的麥可布魯姆。

Thank you. Good morning. So, wanted to ask about the offshore producers that continue to have challenges. Can you maybe bracket, like the outer bounds of outcomes in 2025? So, for example, if this production stays offline for all '25, how much cash flow are you sort of foregoing, and then I don't know if it came on, let's say in the second quarter of this year, how much incremental cash flow would you realize for the year?

謝謝。早安.所以，想詢問一下那些繼續面臨挑戰的海上生產商的情況。您能否將結果括起來，例如 2025 年的外部界線？那麼，例如，如果這個生產在整個 25 年內都處於離線狀態，那麼您將放棄多少現金流，然後我不知道如果它開始生產，比如說在今年第二季度，您今年將實現多少增量現金流？

At this point, we are baking into the guidance that we just gave, basically what the producers are telling us with us taking a little bit of liberty to build in some cushion in the event that it slides to the right a little bit. I'm not sure that we have ever quantified it, but it's in. I mean, I think we're a magnitude is between $5 million and $10 million.

此時，我們正在融入我們剛剛給出的指導，基本上是生產商告訴我們的，我們可以採取一點自由來建立一些緩衝，以防它稍微向右滑動。我不確定我們是否曾經對其進行過量化，但它確實存在。我的意思是，我認為我們的規模在 500 萬美元到 1000 萬美元之間。

That it was off, but we are seeing some of it has already been rectified and some of it is within a week or so of coming back, at least according to the operator. So, Michael, I mean, we don't really, as we sit here today, we don't see a scenario where this is a lasting issue throughout 2025.

它確實關閉了，但我們看到部分問題已經得到糾正，部分問題將在一周左右恢復，至少運營商是這麼說的。所以，邁克爾，我的意思是，當我們今天坐在這裡時，我們實際上並不認為這會成為一個持續到 2025 年的問題。

Okay, perfect. That's super helpful. And then on the 2026 EBITDA forecast, the $800 million, does that assume a continued improvement in the marine business or is that assume more of like a flat outlook relative to 2025?

好的，完美。這非常有幫助。那麼，對於 2026 年 EBITDA 預測，即 8 億美元，是否假設海洋業務持續改善，還是假設相對於 2025 年的前景持平？

I would consider it, yeah, it's reasonably flat. I mean, so we're in a world where we're generating kind of, 130, 140 or so in that business and while there could be more upside in that, that's kind of, we're just kind of penciling that in to be reasonably flat and 26 relative to what we expected in '25.

我會考慮它，是的，它相當平坦。我的意思是，我們現在在這個行業中創造了大約 130、140 個利潤，雖然可能還有更多的上升空間，但我們只是將其預計為相當平穩，相對於我們在 25 年的預期，為 26 個利潤。

Right, got it, thank you so much.

好的，明白了，非常感謝。

(Operator Instructions)

（操作員指令）

Wade Suki, Capital One.

韋德蘇基 (Wade Suki)，Capital One 的成員。

Good morning everyone. Thank you for taking my questions. First on capital allocation, just quickly, I'm wondering if you could remind us how the banks, looking at the press just sort of in the context of your capital return priorities.

大家早安。感謝您回答我的問題。首先關於資本配置，我想問您是否可以簡單回顧一下銀行在資本回報優先的背景下如何看待媒體報導。

How the banks are looking at.

銀行如何看待。

Yeah.

是的。

Exactly in terms of our banks, which are obviously insiders and have read all of the agreements, they treat, they give it 100% equity treatment.

就我們的銀行而言，他們顯然是內部人員，並且已經閱讀了所有協議，他們給予其 100% 的股權待遇。

In the calculation of our compliance with them, that's not necessarily how rating agencies and others look at it that haven't spent as much time as the inside banks have to make that determination. So, for us to rapidly, we can't really are not intent on levering up to take it out because it has a double whammy, if you will, by converting equity into debt in one respect, so I think it's fair to say that our intent is to really use the excess cash flow. We're not prohibited from in fact, we have some flexibility under our senior secured credit facilities to harvest it.

在計算我們是否遵守這些規定時，評級機構和其他機構並不一定這麼認為，因為他們沒有像內部銀行那樣花費那麼多時間來做出這個決定。因此，對我們來說，要迅速地擺脫困境，我們實際上不能不利用槓桿來解決這個問題，因為如果你願意的話，這是一個雙重打擊，一方面，將股權轉化為債務，所以我認為可以公平地說，我們的意圖是真正利用多餘的現金流。事實上，我們並沒有被禁止，我們在優先擔保信貸安排下擁有一定的彈性來獲取這些收益。

And so as we continue to. Get closer to our long-term target of four turns on the bank calculated leverage ratio, we will have the ability in future periods to potentially take it out at a more rapid pace because we have the flexibility under our covenants, but so we have the ability to deal with it, but it is given 100% equity treatment, which is the appropriate treatment from our perspective.

我們會繼續這麼做。更接近我們的長期目標，即銀行計算的槓桿率提高四倍，我們將有能力在未來時期以更快的速度將其取出，因為我們在契約下具有靈活性，但我們有能力處理它，但它被給予 100% 的股權處理，從我們的角度來看，這是適當的處理。

Great, thank you. And just as we approach the sort of free cash flow collection point later this year, can you help us in terms of how to think about the timing and maybe even order of magnitude of potential distribution increases?

太好了，謝謝。就在我們在今年稍後接近自由現金流收集點之際，您能否幫助我們思考如何確定潛在分配增加的時機以及數量級？

I think that, the board will evaluate that on, at the appropriate time again, I think. As we've discussed that in my view, but obviously the board needs to weigh in on it is that it's likely, capital allocation is going to be kind of a little bit of all of the above, but in what absolute or in or relative. Us of that I can't speak at this point, speak to at this point.

我認為董事會將在適當的時候再次對此進行評估。正如我們已經討論過的，在我看來，但顯然董事會需要對此進行權衡，資本配置很可能是上述所有因素的結合，但無論是絕對的還是相對的。關於這一點，我現在無法發言，現在無法發言。

Understood. I appreciate that. If I could squeeze a multi-part question and one more just on so to ask Grant, you always give us a really good color on, sort of supply and demand. Would you mind maybe touching on how kind of contracting season went, where you where you are on that front, and then maybe talk a little bit about some of the end market demand you're seeing where the weakest areas are and areas of resilience as well.

明白了。我很感激。如果我可以擠出一個多部分的問題，再加上一個問題，那麼就問格蘭​​特，你總是能給我們很好的關於供給和需求的資訊。您介意談談合約季節的進度嗎？您在這方面的進展如何？然後談談您所看到的一些終端市場需求，以及其中最薄弱的領域和最具彈性的領域。

Thank you very much.

非常感謝。

Yeah, no, I mean, it's contracting season went about as expected. I mean, obviously in the environment of being in a well supplied market, there was, where we had caps and collars, and we typically would. Price towards the lower end of that that range, and but we have we are purposely under the belief or under our belief that the prices are going to rise as we go through 25, especially as I said, I mean we've seen a reduction of almost 4% of the total supply outside of China being shut in, which is going to help significantly balance the market.

是的，不，我的意思是，簽約季節正如預期的那樣。我的意思是，顯然在供應充足的市場環境下，我們有帽子和衣領，而且我們通常都會有。價格趨向於該範圍的低端，但我們有意相信，或者說我們相信，隨著價格突破 25%，價格將會上漲，特別是正如我所說的，我們已經看到中國以外的總供應量減少了近 4%，這將有助於顯著平衡市場。

That we went short term as much as we could and didn't lock in low prices so that we will benefit as prices increase throughout this year and then as we get into if we continue to see a demand recovery and especially additional removal of high priced synthetic production from the market and We believe that the macro fundamentals will improve and that when we go into 26 recontracting that we'll be in a significantly different environment than what we were in late '24, approaching '25 contract season.

我們盡可能地進行短期投資，並且不鎖定低價，這樣我們將受益於今年全年價格的上漲，然後隨著我們繼續看到需求復甦，特別是高價合成生產從市場上進一步撤出，我們相信宏觀基本面將會改善，當我們進入26年重新簽約時，我們將處於與24年末、接近25年合約季節時截然不同的環境。

Thank you. Appreciate it. Thank you again.

謝謝。非常感謝。再次感謝您。

We have reached the end of the question and answer session. I'd now like to turn the call back over to management for closing comments.

問答環節已經結束。現在我想將電話轉回給管理階層，請他們發表最後評論。

Again, thanks everybody for listening in, and we'll talk to you in another 90 days, if not sooner. So, thanks again.

再次感謝大家的收聽，我們將在 90 天後甚至更短時間內再次與您交談。所以，再次感謝。

This concludes today's conference. You may disconnect your lines at this time, and we thank you for your participation.

今天的會議到此結束。您現在可以斷開您的線路，我們感謝您的參與。