Phillips 66

Good morning and welcome to Phillips 66 first quarter earnings conference call.

Participants on today's call will include Greg Garland, Chairman and CEO, Kevin Mitchell, Executive Vice President and CFO, Bob Herman, Executive Vice President, Refining, Brian Mandell, Executive Vice President, Marketing and Commercial, and Tim Roberts, Executive Vice President, Midstream. Today's presentation material can be found on the investor relations section of the Phillips 66 website. along with supplemental financial and operating information. Slide two contains our safe harbor statement. We will be making forward-looking statements during the presentation and our Q&A session. Actual results may differ materially from today's comments. Factors that could cause actual results to differ are included here as well as in our SEC filings. With that, I'll turn the call over to Greg Garland for opening remarks.

Thanks, Jeff. Good morning, everyone, and thank you for joining us today. Before addressing the quarter, we want to comment on the current environment. First and foremost, our focus continues to be on the well-being of our employees and their families, our communities, maintaining safe and reliable operations, and ensuring the financial and operational strength of our company. Our business is essential, and we're focused on providing critical energy products and services for our customers. The safety and health of our workforce is our top priority. Soil 66 has implemented appropriate steps to protect our workforce that are consistent with CDC, national, state, and local directives. We've limited our operating facilities to business critical staff and implemented strict protocols to prevent introduction and spread of the coronavirus. In our Houston and Bartlesville offices, over 95% of our employees are working remotely. Our employees have stepped up to the challenge during these unprecedented times. and are adopting new ways of working to ensure business continuity. Our plan today for our company, we have them in place to ensure a safe return to our normal operations. We contributed $3 million to COVID-19 relief efforts in the communities where we live and operate. The funds will provide essential support for first responders, food banks, healthcare and other critical organizations serving vulnerable populations. We recently announced actions in response to the challenging business environment. We're focused on conserving cash and maintaining strong liquidity to manage through this unprecedented down cycle. We secured a $2 billion term loan facility and issued $1 billion of senior unsecured notes. We suspended share repurchases in March. We've taken action to reduce costs by $500 million this year. The organization is doing a great job of identifying opportunities and efficiencies, and we're leveraging our Advantage 66 initiatives to achieve these cost savings. We're reducing consolidated capital spending by $700 million. This reduction will be partly offset by a $400 million increase as DCP Midstream will not be exercising its option to participate in Sweeney-Frax 2 and 3 this year. We've deferred the Red Oak Pipeline and Sweeney Fract Four projects. Phillips 66 Partners has also deferred Liberty Pipeline and postponed its final investment decision on the ACE Pipeline. In refining, we're deferring and canceling certain discretionary projects. We continue to fund sustaining capital to ensure safe and reliable operations, and we're executing the in-flight projects that are near completion. We deferred some turnarounds until later this year and also into 2021. We've reduced refinery runs across the system in response to lower product demand and margins. In April, our crude capacity utilization was in the high 60% range. These steps provide additional liquidity and flexibility as we navigate this global crisis. By doing so, we're protecting the company, the security of the dividend, and our strong investment-grade credit rating. We remain focused on disciplined capital allocation and creating long-term value for our shareholders. In the first quarter, total adjusted earnings were $450 million or $1.02 per share. We generated $217 million of operating cash flow or $736 million excluding working capital. We returned $839 million to our shareholders. During the quarter, we achieved strong safety performance. We continue to strive toward a zero-incident, zero-accident workplace. We're executing our strategy and progressing major growth projects. The Grey Oak pipeline commenced full operations of West Texas service on April 1st, and more recently, the Eagleford segment of the pipeline started operations, marking completion of the project. At the Beaumont terminal, we added 2.2 million barrels for fully contracted crude oil storage, increasing the terminal's total crude and product storage capacity to 16.8 million barrels. We continue to advance midstream growth projects scheduled for completion this year, including Sweeney Frax 2 and 3, Beaumont .4, as well as PSXPs, Clemens Caverns Expansion, and the South Texas Gateway Terminal. These projects are progressing well as planned. And chemicals. CP Chem and Qatar Petroleum are jointly pursuing development of petrochemical facilities on the U.S. Gulf Coast and in Qatar. CP Chem continued front-end engineering design for its U.S. Gulf Coast project and advanced joint venture discussions with its partner. CP Chem has deferred a final investment decision on the Gulf Coast project. In refining, we completed the FCC unit upgrade at the Sweeney Refinery to increase production of higher-valued petrochemical products and higher-octane gasoline. The project was completed on time and within budget. In marketing, our West Coast retail joint venture is expected to close on the acquisition of approximately 100 sites in the second quarter of 2020, as previously announced. The joint venture enables increased long-term placement of our refinery production and increases exposure to retail margins. In closing, we're honored that five of our refineries were recently recognized by AFPM for their 2019 safety performance. our Ferndale, Santa Maria, Borger, Lake Charles, and Bayway refineries received distinguished safety awards. This is the highest annual safety award in our industry and the fourth year in a row that our refineries have received this honor. AFPM also recognized C.P. Kim's Borger, Conroe, Orange, and Port Arthur facilities for exemplary 2019 safety performance. So congratulations to all those facilities. We're proud of you. Really well done. And with that, I'm going to turn the call over to Kevin to go through the financials.