ConocoPhillips

Good morning, and welcome to the Q1 2020 earnings call for ConocoPhillips. My name is Zanara, and I'll be the operator for today's call. At this time, all participants are in a listen-only mode. Later, we'll conduct a question-and-answer session. During the question-and-answer session, if you have a question, please press star, then 1 on your touch-tone phone. Please note that this conference is being recorded. I'll now turn the call over to Ms. Ellen DeSantis. Ellen, you may begin.

Thanks, Zanara, and good morning to our listeners. Thank you for joining us today to discuss this morning's press release, which contained our first quarter earnings results, our dividend declaration announcement, and an update on our curtailment actions. Our speakers today will be Ryan Lance, our Chairman and CEO, our Chief Operating Officer, Matt Fox, and our Chief Financial Officer, John Ouellette. Ryan will make some very short opening comments, but we'll reserve most of the time on today's call for the question and answer session. We don't have any slides this morning, but we will post a replay of this call shortly. As you know, given market volatility, we have temporarily suspended guidance. However, we may make some forward-looking statements in today's call. Please refer to our SEC filings for a description of the risks and uncertainties that could impact future performance. And now I'll turn the call over to Ryan.

Thank you, Ellen, and welcome to today's call. Well, here we are at the start of first quarter earnings for the E&P sector, and it's a brave new world for all of us. Ordinarily, we would use this call to discuss our recent quarter results in detail and provide guidance for future periods. But the first quarter already feels like a long time ago, and as you know, Due to significant uncertainty and volatility in the markets, we will temporarily suspend guidance. So here we are. Well, while we won't provide guidance, we continue to believe it's important for ConocoPhillips to provide insights. How are we thinking about this environment? What actions are we taking or considering taking to respond? And that's how we'll intend to use this conference call time today. I'll make some very brief remarks, then turn the call over to our listeners for a question and answer session. There are three themes I want to emphasize in these remarks. First, our underlying business is running very well. You saw our first quarter results in this morning's press release. It was quite a strong quarter operationally, despite the COVID-19 pandemic. I'm certainly very proud of our organization. While some activities are changing day to day, I assure you that our workforce is all in on safely delivering the business, including our upcoming seasonal turnarounds and our ongoing capital activity. The second theme I want to emphasize in these prepared remarks won't surprise anybody. It's this. The next few months are going to be very bumpy for the industry and for us. A couple of weeks ago, we announced plans to begin voluntary curtailments in May. This morning, we announced that we expect to curtail about 265,000 barrels per day gross in May from our lower 48 in Sermont combined. We also announced that we'll expect to curtail about 460,000 barrels of oil per day gross in June from our lower 48, Sermont, and Alaska combined. On a net basis, this represents about a third of our first quarter production. This should be seen as a clear signal that we're willing to use flexibility and balance sheet strength to protect value for our shareholders. And that brings me to the third theme of these remarks. In our previous two market update conference calls, we've emphasized that our actions in this environment are driven not only by our view of the markets, but by the fact that we entered this downturn in a relatively advantaged position compared to most of industry. You saw in today's press release that we ended the quarter with total liquidity of nearly $14 billion, including the $6 billion available under our revolver. Our portfolio was diversified and relatively low-declined. These are the factors that allow us to make rational decisions based on a reasoned views, and we can continue to assess and monitor the markets that act. We continue to manage the business in a way that preserves our strong relative position, allows us to take additional actions if needed, and protects our ability to resume programs in the future. So in summary, here's what I want you to take from my comments. The underlying business is running well. We have a strong first quarter operationally, all things considered, and our workforce remains focused on safely delivering our plans. We expect a period of significant volatility over the short term. We know what we need to do. And we are relatively advantaged coming into this downturn, and we'll protect that relative advantage as this environment plays out. So with that, I'm going to turn the call over to the operator, and we'll begin our Q&A.