Stabilis Solutions, Inc.

Good morning, ladies and gentlemen, and welcome to Stabilist Solutions' first quarter 2023 earnings conference call. Joining us today are Westy Ballard, President and CEO, and Andy Puhala, Chief Financial Officer. Before we begin, I'd like to remind everyone that today's conference call will contain forward-looking statements within the meaning of the Private Securities Reform Act of 1995 and other securities laws. These forward-looking statements are based on the company's beliefs and expectations as of today, May 11, 2023. Forward-looking statements are subject to the risks and uncertainties that may cause actual results to differ materially from those projected. The company undertakes no obligation to release updates or revisions to the forward-looking statements made in today's conference call. Additional information concerning factors that could cause those differences is contained in the company's filings with the SEC and the press release announcing the company's results. Investors are cautioned not to place undue reliance on any forward-looking statements. Please note that the company may refer to certain non-GAAP financial information on today's call. You can find reconciliations of the non-GAAP financial measures to the most comparable GAAP measures in the company's earnings press release. Today's call is being recorded. At this time, I would like to turn the call over to Westy Ballard, President and CEO of Stabilis Solutions. Please go ahead, sir.

Good morning, everyone, and thanks for joining us. I think we may have several new attendees on our call today, so before getting into the business results, let's quickly take a step back and take a look at an overview of our company. We are an environmental transformation company and currently one of North America's largest providers of small-scale liquefied natural gas. with future aspirations of expanding our offerings into additional clean emerging fuels. We own and operate two strategic liquefaction plants, and we also source LNG from over 30 supply points in the US. We have a robust and highly mobile asset base, and we believe we have the most comprehensive turnkey commercial, technical, and engineering capabilities in the market to assist customers in the design, engineering, and implementation of their fueling needs across the US, Canada, and Mexico. Our company serves two primary markets, industrial and marine. Our industrial business is our core legacy business and services companies across multiple industries, including mining, pipelines, remote power, food and agriculture, utilities, oil and gas, and general industrial. This business also includes a growing presence in the aerospace industry. Sales cycles in our core industrial business tend to be shorter, with minimal capital investment required. Aerospace has similar characteristics. However, as private rocket launch programs mature, we believe longer, more rateable commercial relationships are more likely. Our marine business consists of project management, engineering, production, or third-party sourcing, delivery and fueling of LNG and vessels in the maritime industry, as well as the exportation of LNG outside the U.S. Sales cycles in both portions of our marine business tend to last longer, involve larger, more predictable LNG volumes, and will require considerable infrastructure and technical know-how as vessel operators and carriers better understand their needs. In turning to the quarter, we had a solid start to the year where we made progress across several of our priorities and our capabilities continued to grow. Commercial interactions across all of our business lines have steadily increased, and we are excited to continue to build upon the substantial progress made in 2022. In our industrial business, demand was strong across multiple sectors with oil and gas, agriculture and food, and remote power leading the way. As I've said in the past, the diversity of end markets we serve is one of the great attributes of our company, and the first quarter was no exception. We anticipate demand to continue in this business due to three primary drivers. First, LNG is generally less expensive than other fuel choices. Second, many off-grid and off-pipeline gas customers require last-mile virtual pipelines. And third, the drive toward cleaner fuels. As we continue to identify ways of maximizing revenue and margin opportunities with our existing customer base and stimulating new and profitable demand in new sectors and geographies, We feel confident in our ability to execute, given our positioning as one of North America's largest turnkey providers of last mile delivery to the industrial sector. During the quarter, our marine business experienced solid activity, too. Operationally, we safely and successfully completed a significant short-term bunkering project that called for the delivery of several million gallons of LNG sourced from a large trading position spread among several supply points, supported by our own sizable engineering and supply chain. Our commercial, technical, and operational expertise continues to give us a tremendous advantage in the market and makes us uniquely qualified to execute bespoke bunkering solutions to vessel owners and operators designing LNG bunkering fuel in North America. Our rapid planning process and unmatched mobile asset base afford us the ability to quickly deliver fuel across a variety of geographies, which was on display during the quarter as we successfully execute marine operations along the east, gulf, and west coasts and contribute roughly 28% of total revenue for the quarter compared to 4% in the first quarter of 2022. As we progress, this continues to be an exciting opportunity for scaled growth at our company, driven by the International Maritime Organization's key mandate requiring that lowering of sulfur emissions in the maritime industry. Ship owners and operators have to quickly identify ways to become compliant through meaningful investments in their existing fleets and or adopt alternative fuels for propulsion. This paradigm shift spawned a massive increase of new build orders for the LNG fueled vessels, resulting in a number of vessels growing exponentially from roughly 285 in the world today to over 700 over the next few years. In doing so, these vessels need fuel. Currently, the vast majority of LNG bunkering occurs outside of the US. However, given the United States' favorable competitive positioning in natural gas, so supply, reliability, security, and price, the US has tremendous potential to be a premier bunkering hub. This will require considerable technical, operational, and infrastructural capabilities. Barriers to entry are high, and for a supplier to ultimately be successful in bunkering, they must have the ability to source and deliver volumes in scale, They must have the mobility and flexibility to bunker in a variety of ports. They must have considerable technical and supply chain capabilities. And they must have the ability to deliver fuel simultaneously with vessels loading and unloading their respective cargoes or passengers. While we have had great success over the last few quarters delivering bunkering solutions to customers, and we continue to materially increase the number of commercial discussions with prospective customers, It is important to note that the U.S. LNG bunkering market, while growing, is still at an early stage. As I mentioned earlier, unlike our industrial business, marine commercial cycles have long lead times and many prospective customers are still in the process of determining their strategies for fueling their new assets, many of which won't hit the market until next year. In the meantime, we will continue to lay a considerable operational foundation in addition to evaluating the expansion of our assets and infrastructure to capitalize on this most exciting market. Outlook in our export business, while very positive, is also still at an infant state. However, I strongly believe that the prospects for the exportation of considerable volumes the U.S. Department of Energy has granted us are very compelling. As increased demand, geopolitical uncertainty, and dislocation in natural gas prices continue, we are well positioned to be a valuable participant in the export business. We will work diligently to expand our scale and our business to be successful. Additional capital and operational investments will be required. As we think about financing, we will explore a variety of prospective debt and equity sources of capital with heavy emphasis and focus on those that know our industry and our company. One of the attractive components to small-scale LNG is the ability to rapidly deploy capital in a modular fashion with potentially strong and quick returns on capital. Our prospects are exciting and certainly not short-term. Stabilis is very much positioned as a long-term growth story and a highly asymmetrical opportunity to invest in a rapidly growing company with a proven and durable business model diversified across multiple sectors and geographies. And with that, I will turn it over to Andy to discuss the quarter results.

Thanks, Westy, and good morning, everyone. Stabilis had another good quarter in Q1, building on the performance we saw last year and generating positive net income and double-digit EBITDA margins for the quarter. For the first quarter of 2023, Stabilis reported revenues of $26.8 million, 32% higher than the year-ago quarter, but down 9% from the fourth quarter of 2022, in part due to the completion during Q1 of a short-term bunkering project that Westy referred to in his comments. Net income from continuing operations was $1.1 million in the quarter compared to a net loss from continuing operations of $0.4 million in the year-ago quarter. Net income from continuing operations was $0.2 million in the fourth quarter of 2022. Adjusted EBITDA for the quarter was $3.5 million compared to $2 million in the year-ago quarter and $3.9 million in the fourth quarter of 2022. We ended the quarter with $7.9 million of total available liquidity. The reduction in cash balances from the fourth quarter relates to the purchase of liquefaction, bunkering, and storage assets, which can be quickly deployed to a variety of locations to support anticipated growth. We have sufficient liquidity to fund our operations and we believe we have access to a variety of capital sources to fund our growth initiatives. This concludes our prepared remarks, so at this time, moderator, please open the line for questions.

Certainly. At this time, we will be conducting a question and answer session. In the interest of time, we ask that you please unmute yourself to one question before re-queuing. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once more, it's star 1 if you wish to ask a question. And please hold while we poll for questions. And the first question today is coming from Martin Malloy from Johnson Rice. Martin, your line is live.

Good morning. Congratulations on another nice quarter. Thank you, Marty. Good morning. My first question, I just wanted to ask about something that was in the press release, the comment about results in the next couple of quarters may be uneven as individual projects are completed. Could you maybe talk a little bit more about those projects and what's causing the uneven results? Is it additional expenses that are incurred when the projects come online?

Yeah, so if you put in the two buckets that we talked about, the industrial, much shorter sales cycles, but really what we're referring to is that marine side. And that's still in its nascent stage of expansion. And so there's going to be some lumpiness as these vessel owners and operators make, I think, poignant decisions in and around how and where they want to have infrastructure to bunker. And so we were successful and have been successful and operated on three coasts. in the first quarter, and I anticipate us to continue to operate across a variety of geographies moving forward. It's just, it's going to be a little lumpy until that business matures, and you also got to remember that a large portion of those newly commissioned LNG ships aren't going to hit the market really to the beginning of next year, and so there's a lot of foundational work that's being built today. Doesn't mean there aren't bunkering opportunities right now, but the real scale starts beginning next year, and that's what we're laying a solid foundation for, is to have infrastructure, or at least sightline to infrastructure, sightline to backlog, and obviously marrying those up as best as possible. And so it's going to be a little choppy in that business between now and the rest of the year, but make no mistake, the lens in which we're looking through with potential in the future is considerable.

And could you maybe talk about how you're thinking about expanding potentially liquefaction capacity in light of that expected demand that you see increasing?

Yeah, without getting into specifics, we are looking at brown and greenfield expansion across multiple geographies, certainly in the U.S., and that's not relegated just to the Gulf of Mexico. That's the East Coast. That's the Mid-Atlantic in the East Coast. That's down in the Florida region. That's up and down the entire West Coast. There are a variety of opportunities for us to be thoughtful around the deployment of capital to service what we see is the potential for considerable demand. Again, there's a pace of play here. You don't want to get too far ahead in your supply chain until you have a little bit more affirmation in your commercial side. But at the same time, you don't want to have a massive amount of commercial opportunities and not be preparing your infrastructure and supply chain. So we made some steps in that direction in the first quarter. As Andy alluded to, we put some capital dollars to work and some mobile and modular storage, bunkering and liquefaction capabilities. One of the great things, as I mentioned, about this business is that that can move to a variety of different geographies. We have some thoughts around where it's going to go. But we're giving ourselves a really fluid and flexible platform and spending some money in advance to be primed and ready to go as this commercial book of business continues to expand like we think it will.

That's great. Thank you for taking my questions.

Yeah, thank you.

Thank you. The next question is coming from Barry Hames from Sage Asset Management. Barry, your line is live.

Good morning. Good quarter, guys. Thank you. I had two questions. One is, is bunkering profitable yet? And if not, you know, what sort of size does it need to get to to get into profitability? So a little flavor for that. And secondly, you broke out the percent revenues for bunkering, but could you do a similar thing for aerospace? You know, what percent of revenues were aerospace during the quarter? And, you know, how might that compare to a year ago or last quarter? Thanks.

Yeah, so bunkering is profitable today, absolutely. One of the benefits is that there's a lot of utilization from our core industrial business, some of the technical aspects, some of the operations, engineering, even equipment that is absolutely utilized for bunkering. The real main differences in bunkering versus our core kind of industrial business business line is really the kind of the sales cycle. And it's just longer lead times around the reasons I just mentioned. There will be some additional kind of capex, not necessarily, there'll be some opex, but some capex for infrastructure that's unique to that marine business. But absolutely, it's a profitable day and it's our aspirations to have that trend continue as we kind of venture into the future and scale that business. Aerospace for the quarter, I think, Andy, was a little over 5%. And comparing that to the first quarter of last year, it was down about 300 basis points, more or less. Until there's longer-term rateability in that aerospace business, it's going to be very similar to the industrial, kind of shorter sales cycles, demand from our space customers. As you can see, some of the trial and error that goes on in that space business is You know, sometimes you'll get an onslaught of needs, and sometimes it'll be somewhat of a dormant sales cycle. But I think ultimately, as the private sector continues to mature their operations and get more consistent in their kind of pace of play, we expect there to be more rateability in space. It's just not there right now, but we feel pretty good that in the intermediate and long term it will be.

Great. Thanks very much.

Yep.

Thank you. The next question is coming from Bill DeZellum from Titan Capital. Bill, your line is live.

Great. Thank you. A group of questions. First of all, relative to the growth in revenue versus the first quarter, I think you referenced take or pay in the press release was a meaningful part of that. Would you discuss kind of just the commercial realities behind what led to the taker pay fees, and presumably that's roughly 100% margin as opposed to had those customers taken the guess that it would have been a more traditional gross margin.

Yeah, and so you've got to understand that there's not kind of one-size-fits-all bunkering operation. You have offtake with a variety of different customer groups types that have different rationale for bunkering. We will sometimes be a direct supplier to the vessel operators and owners. Sometimes we'll be a subcontractor. Sometimes we're providing a complete turnkey solution with engineering, product design, development, regulatory, fuel supply. Sometimes it'll be third party. So there's not one size fits all. So you got to look at the totality. And so to the extent that you've got Take or pay there may be instances where you know commodity prices shift or change and a customer Changes the perspective and their desire to take that that fuel and so they'd rather pay a penalty other instances where Their their offtake or their needs are high and their operational tempo is high and they want to take the fuel you have you know disruptions in in vessel ports of call you have just a variety of things that bill that can contribute. So it's hard to really kind of pinpoint it to one thing, but looking at the totality of it is really a way to think about that.

That's helpful, Westy. So the take or pay this quarter had nothing to do with warm weather in the northeast and the base loading that you have been supplementing historically. This is in the bunkering arena.

That's correct. That's exactly right.

Okay. That's quite helpful. Thank you. And then relative to the sequential decline in revenues, what industries led to that change?

That's really around the oil and gas industry. We love it. We love that part of our business. I'm glad it's It's got the weighting that it has. In my prior life, it was a much heavier weighting. But there's some ebbs and flows in the oil and gas world, and that was the main driver.

And so I'm totally breaking the rule of the operator asked for one question only, so you can cut me off at any time you'd like. But I guess the rig count and the completion activity seemed to be somewhat steady in the first quarter. So did you have something, just a customer making decisions to pull back? Or what changed there that maybe we wouldn't see with looking at the rig count or completion count?

Yeah, I'll answer that in two ways. One, this one was more specific to really center around one customer. But more broadly speaking, remember that there are a variety of different offtake points in the oil and gas business. And so you could have people who are under extensive maintenance or unplanned outages, or there are a variety of things that can contribute to a decremental revenue as well as an incremental. Rig count could increase, but it's not solely dependent upon just rig count. There are a lot of other kind of drivers that could enhance or reduce revenue output from our perspective in the oil and gas business.

Thank you. And then natural gas prices in the U.S. are much lower than than they have been in 2022. It raises the question, does the lower natural gas price drive increased interest from prospective customers? I guess the question is, how much do just pure economics in terms of cost savings lead to your prospective customers making a decision to use LNG?

So let's talk about a couple venues. I think it's a huge contributing factor, that kind of spread between alternative fuels and LNG. And you mentioned it, with natural gases in that kind of two-handle or slightly above, we feel like we are very well positioned, especially, as I mentioned, the demand that's come of prospective customers wanting to potentially even talk to us about longer-term positions over several years to capitalize on these lower prices, a bit of arbitrage on their part, and that's been a really strong kind of inbound for us, as well as we have proactively been utilizing that as a proactive sales tool as we talk about new and incremental customers. But price has been and continues to be a driver, along with obviously the demand and the ESG and cleanliness of natural gas. But make no mistake, price has, and we feel we'll continue to be a driver now and in the future.

Thank you. And then one additional question to expose my ignorance here. The ultra-low sulfur diesel IMO 2020 standards went into effect, I think, in 2020. And so I guess the question is, why is this business still increasing it seems as though, I guess thinking out loud, that the shipping companies should have made the transition two or three years ago. What am I missing here?

You're not missing anything, and you're right, they should have, but oftentimes we don't necessarily react, they, or one, doesn't necessarily react as expeditiously as they probably should have, and I think the cold hard reality not only of the IMO having this mandate to lower sulfur emissions, call it an 85% range, but you kind of pair that with some of the pressure of a lot of the retail and other shipping customers who are starting to be more vocal about their expectations for their shipping carrier providers to provide a cleaner, more sustainable solution. I think that's also been the impetus for a lot of these shipping operators and owners to really get off the center and start doing something about this. And they have. Remember, these ships aren't built in a matter of weeks. They're built in a matter of years. And so there's quite a bit of lead time. And so for ships that already have been commissioned, those that were commissioned this year, and those that will be commissioned thereafter, you're talking about maybe one to three years in advance. And so it's... It's an engineering marvel. It's a lot of different things that go into this, and so some have waited, some have not. There's no real good answer to your question other than what your instincts would tell you.

So, Westy, to what degree would you agree with this statement that the regulatory teeth around IMO 2020 have been soft enough that it has really allowed the shipping companies to use the effective date of when they were supposed to be done almost as the start date on when they could go to the regulators and say, yes, gosh, you know, so sorry, we're in progress. Look what we're doing. We've ordered a ship. We're making this transition, et cetera, et cetera. And that really lengthens out the true economic expense for them and then the startup time for you all.

Yeah, it's hard to really kind of put myself into the hearts and minds of the owners and operators. I'll say that one of the things you've got to remember is these are predominantly dual-fueled vessels, and so it's not like they are holistically running LNG. What they're trying to do is create either arbitrage or optionality for themselves based upon availability of the lowest price point and the highest energy density fuel in the markets and ports of call that they call on. And so it doesn't mean that these ships can't also run diesel, low sulfur diesel. They will. And in some instances, they're going to have to because there's the torque and idle time when they dock that LNG is not as responsive. So there's other kind of engineering and technical reasons. But for me to say that they waited until there was some teeth, I don't think I can answer that. I can say that this time last year, there were about 100 ships in and around the market that we're focused on, the subset of the bunkering, and that's going to grow about seven-fold over four years, some of which placed orders several years ago, some have placed them now. So I think the bigger takeaway is if you look at the scale of this business over the next one, two, three years, it's considerable. It's considerable. And nine times out of ten, to the extent that a shipping company can bunker with LNG and We have very strong reasons to believe that they will. And they want to do that in the U.S. given the price arbitrage. It's just we, organizationally and as a kind of an industry, we need to be making that availability a reality with infrastructure and supply chain and technical know-how. You know, you don't just show up and bunker a ship. There's a lot that goes into it and high barriers to entry, as I mentioned, and we think we are far, far, far, in a way, one of the leaders along that continuum in doing so.

Great. Thank you for taking all my questions. Really appreciate it. Yeah, of course.

Of course. Thanks, Bill.

Thank you. The next question is coming from Liam Burke from B. Reilly. Liam, your line is last.

Thank you. Good morning, Wesley. Good morning, Andy. Good morning. Good morning. Wesley, in terms of LNG export, what types of customers are you fielding inquiries from, and what kind of volumes are people talking about?

So think kind of 20,000 cubic meter vessels and smaller. Okay. So this obviously is not a world-scale business for us, but if you just did simple math around the art of the possible, the Department of Energy has given us a license to to export up to kind of almost just shy of 52 BCF of natural gas equivalent annually. And so this year was a little bit challenging, just given the unseasonably warm climate, certainly in the European realm. But we have strong conviction that over the next 28 years or 27 years of our license that it's going to get cold again in Europe. And it's a bit of a gamble, I guess. But what we want to do is we'd be remiss if we didn't at least kind of prime the pump and have our infrastructure in ducks in a row because it could happen as early as this fall as forecasters start to think about geopolitical unrest in some of these international markets, and you start thinking about some of these – you know, cold weather environments. We want to be ready to go. I don't have anything tangible right now, but rest assured, we are ready to fuel vessels, and we will be ready to fuel vessels at kind of the 20,000 cubic meter and below.

Okay. And you talked about servicing three ports, I believe, now with LNG bunkering. Obviously, this is a scale where you have to combine sourcing and then provision, but how many – additional ports do you think you'll begin to service this year?

Good question. I think, you know, ultimately it's going to obviously depend upon that pace of play, but I think when the dust settles, whether it's this year or the next, we'd like to be in, you know, six or seven different geographies in and around North America. I'm not trying to not answer your question, but there's a lot of different things that we are evaluating literally as we speak. And so stay tuned on that. And you're right. You've got to, at this point in time, source or have trading positions across a variety of different supply points. That's what we do. We are really, really good at that. And to the extent that I have other competitors out there, that's just not kind of their competency. And so we're pretty proud of our capability there. We're really good at that. We'll continue to do that. We'll continue to supplement that with kind of green and brownfield infrastructural investments. So we're really excited about having a pretty broad network in that North American market over the next year, two, three years.

Great. Thank you, Wesley.

Yeah, thanks.

Thank you. As a reminder, please press star one if you wish to enter the Q&A queue. And the next question is coming from Spencer Lehman. Spencer is a private investor. Spencer, your line is live.

Hi, guys. Good report. You're in a lot of exciting, interesting areas. Unfortunately, you're sort of off the radar as far as the financial community. I know you're a small company, but I'm just wondering, it's a long wait in between quarterly reports. I'm just wondering if you could, as long as you're not hurting any competitive advantage, could you come out with some news more often as far as maybe a new contract or a new area? You know what I mean?

Yeah, no, good point, and thanks so much. I think kind of my perspective is when I joined the company, call it roughly 18 months ago, I wanted to make sure that we had an optimized business and an optimized kind of approach. We, I think, have made great strides in doing so. And then in addition to that, I wanted to make sure that that, Spencer, we had some real commercial meat on the bone and tangibility. What I don't want to do is I don't want to be a, how do I say this, just kind of a press release machine, but I think it stands to reason that over the next several quarters and years that the pace and velocity and volume of interaction with investors will increase as we continue to do our job because we'll just have more tangible things to talk about. But over the last 18 months, we wanted to make sure our house was in order, and I think it is. And now the real exciting stuff is hopefully going to start bearing fruit. And so we'll be thoughtful around that, and I think hopefully more vocal around that as well.

That makes good sense. And I didn't mean for you to hype the stock with the announcement as much as just out of interest. I get that. you know, impatient, waiting so long in between. So, you know, what are you going to do that is not expensive or, you know, as you say, competitively disadvantage you?

Yeah, I understand. And rest assured, you're not the only one that's impatient, I promise you.

All right, thanks. I am too.

I am too. Thank you, Spencer. Thank you.

Thank you. And next we have a follow-up from Barry Hames from Sage Asset Management. Barry, your line is live.

Thanks. Yeah, I have two quick follow-ups. One, on the bunkering business, you mentioned that about 100 ships serve the U.S. market or in markets where you would serve to date. So can you give us some feel for how many of those 100 you've served to date? Just a feel. And then secondly, just looking at at next year, 2024, how many ships, new ships, will be coming into the market compared to the 100? And then second question, let's do that one, and then I have one on the export license.

Yeah, so on the 100, you know, I'm not going to get into the actual specifications around how many. I will say that the good news is, or the bad news is, it's a small percentage. But the good news is it's a small percentage, meaning there's a tremendous amount of runway for us and go-get for us to go get. And so we're really excited about that. Sorry, the second question was?

How many new ships coming into the market next year?

I'd have to circle back with you on that. I don't have that exact number. And so let us get back to you on that one if we can.

Okay, great. And then the one question on the export licenses, the way you described it, Westy, is it Is it fair to say that what you really have is a call option should Europe have a cold winter and need spot cargoes? Is that the right way to think about it? That is.

And so there's a couple ways to think about this. One is it's a call option, whether it's Europe or elsewhere. Remember, I'm not relegated just to Europe. I've got a license to go to all free trade and non-free trade, obviously non-OFAC, but all those countries outside of Europe as well are all fair game for me, provided that we as Americans are allowed to export. And so that's all very much in play. But also, we'll look at this through a couple of different lenses. There may be scenarios where we are very comfortable with that counterparty, and we generate some maybe margin in the U.S. market, but share in some upside commercially abroad as they place those molecules internationally. There may be other instances where we're not enthusiastic about that kind of commercial model, but we think we've got a tremendous amount of flexibility to do a variety of different things globally. Also, there's opportunities where maybe there's some readability to this. Maybe somebody wants to to sign on for six, nine, 12 months of offtake. Some might be more opportunistic. I'm just excited that I'm not pigeonholed into one kind of business model. And yeah, we've got, to use your word, optionality and flexibility across a variety of different commercial and operational fronts that allow us to really yield results from our export business.

Great. Thanks so much.

Yep.

Thank you. Next up, we have a follow-up from Spencer Lehman. Spencer, your line is live.

You guys didn't talk too much about some of the alternative fuels that you have in the background in case there's a lot of anti-fossil fuel mentality developing in the country and going to do away with gas stoves, etc. I'm just wondering if that's something that you can talk about a little bit and whether it's hydrogen or whatever you have. Yeah.

That's a good question, and thanks for bringing that up. We very lightly touched on our aspirations to expand those offerings to additional kind of clean and emerging fuels, and I think the way to think about this is kind of how we want to iterate into that. Said differently, our first kind of, I think, goal would be to have fuels that are really in partnership or a great marriage to our LNG businesses. Think biofuels, think renewable RNG, think RNG and other kind of areas that can marry to that. But also, along the continuum, there's going to be, I think, a continuing expanded demand for methanol in the shipping business. And so that's something that we're looking at. We're looking at ammonia. Hydrogen is one of those jerky ones, not that we're rolling it out, and we absolutely are putting teams around that to further evaluate that. I don't think hydrogen is kind of the here and now for us today. I think there are other bespoke kind of clean emerging fuels that act as real companion to our LNG business. So I don't know if that answers your question.

Yeah, that's good. The more you can talk about that, I think for certain – parts of the investment community that might be really interesting.

It is. I'll tell you one last kind of anecdote here is I don't want to, in two years, have our head in the sand and not being, I think, thoughtful and open about the art of the possible and realities around the introduction of other clean fuels into our offering. And so we aren't waiting. We are building opportunities. capabilities around that today, realizing it might be tomorrow. But today, we want to start getting smart and thoughtful around how we're going to attack this.

That sounds good. Thank you.

Thanks, Spencer.

Thank you. This does conclude today's Q&A session. There are no more questions in queue. I would now like to hand the call back to Westy Ballard for closing remarks.

Great. Thanks again for joining us, and we look forward to seeing you out on the road in the market very soon. Take care.

Thank you. This does conclude today's conference. You may disconnect your lines at this time and have a wonderful day. Thank you for your participation.