Valero Energy (VLO) Q4 2020 Earnings Call Transcript

Valero Energy (VLO 0.68%)
Q4 2020 Earnings Call
Jan 28, 2021, 10:00 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Ladies and gentlemen, greetings, and welcome to the Valero Energy fourth-quarter 2020 earnings conference call. [Operator instructions] It is now my pleasure to introduce your host, Homer Bhullar, vice president of investor relations. Thank you, sir. You may begin.

Homer Bhullar -- Vice President of Investor Relations

Good morning, everyone, and welcome to Valero Energy Corporation's fourth-quarter 2020 earnings conference call. With me today are Joe Gorder, our chairman and CEO; Lane Riggs, our president and COO; Jason Fraser, our executive vice president and CFO; Gary Simmons, our executive vice president and chief commercial officer; and several other members of Valero's senior management team. If you have not received the earnings release and would like a copy, you can find one on our website at investorvalero.com. Also attached to the earnings release are tables that provide additional financial information on our business segments.

If you have any questions after reviewing these tables, please feel free to contact our investor relations team after the call. I would now like to direct your attention to the forward-looking statement disclaimer contained in the press release. In summary, it says that statements in the press release and on this conference call that state the company's or management's expectations or predictions of the future are forward-looking statements intended to be covered by the safe harbor provisions under federal securities laws. There are many factors that could cause actual results to differ from our expectations, including those we've described in our filings with the SEC.

Now, I'll turn the call over to Joe for opening remarks.

Joe Gorder -- Chairman and Chief Executive Officer

Thanks, Homer, and good morning, everyone. The COVID-19 pandemic has had an extraordinary impact on families, communities and businesses across the globe. The energy business was among those confronted by unprecedented demand contraction, which began in the first quarter of 2020 as COVID-19 cases accelerated globally, resulting in an increase in crude oil and product inventories to record high levels. In response, we lowered our refinery utilization rates to more closely match product supply with demand.

And as the pandemic-related restrictions were eased in some regions and mobility increased, product demand increased substantially, steadily reducing crude oil and product inventories. We ended the year with U.S. crude oil and product inventories within the normal five-year inventory band. Throughout the pandemic, our team has been thorough and decisive in its operational and financial response, while maintaining focus on safety and reliability.

In fact, we set several operational records in 2020, recording our best ever year on employee safety performance, achieving the milestone two years in a row and the best ever year for process safety and environmental performance. In applying our refining expertise to optimize our renewable diesel segment, we set records for sales volumes and margin in 2020. We also made significant progress on our international strategy to expand our product supply chain into higher-growth markets, with the start of waterborne product shipments to our new Veracruz terminal, making Valero one of the largest fuel importers into Mexico. On the financial side, we improved our liquidity by raising $4 billion of debt at attractive rates, and we reduced our capital budget by over $500 million while keeping our high-return projects moving forward.

And in spite of all the challenges this past year, we continue to honor our commitment to our shareholders by maintaining the dividend and ending the year with $3.3 billion of cash and $9.2 billion of total available liquidity. Despite the pandemic-imposed challenges and several hurricanes, we completed and continued to make progress on several strategic growth projects, including the St. Charles Alkylation Unit, which was brought online in the fourth quarter, on schedule and under budget. The project further increases the competitiveness of the St.

Charles refinery and is a testament to the talent and efforts of the refining organization. The Pembroke Cogen project and the Diamond Pipeline expansion are on track to be completed in the third and fourth quarters of 2021, and the Port Arthur Coker project is expected to be completed in 2023. The Diamond Green Diesel expansion project at St. Charles, which we refer to as DGD 2, is designed to increase renewable diesel production capacity by 400 million gallons per year and is expected to be completed in the fourth quarter of 2021.

As a result of continuous process improvement and optimization, the capacity of the existing St. Charles renewable diesel plant, DGD 1, has increased from 275 million gallons per year to 290 million gallons per year. With the completion of DGD 2, the total capacity at St. Charles is expected to be 690 million gallons per year.

In 2020, we laid out our comprehensive road map to reduce greenhouse gas emissions by 63% by 2025. As part of this goal, we continue to reinvest capital into higher growth, higher return, low carbon renewable fuels projects. To that end, we are pleased to announce that the board has approved DGD 3, a new 470 million gallons per year renewable diesel plant at our Port Arthur, Texas refinery. We're moving forward with the project immediately, and we now expect the new plant to be operational in the second half of 2023.

Once DGD 3 is completed, DGD's combined annual capacity is expected to be 1.2 billion gallons of renewable diesel and 50 million gallons of renewable naphtha. Looking ahead, we expect to see continued improvement in refining margins as COVID-19 vaccines are widely distributed in the coming months, allowing people and businesses to get back to normalcy. We're already seeing encouraging signs with strong diesel demand and with U.S. total light product inventories now in the normal range.

In addition, many uncompetitive refineries around the world announced shutdowns or conversions in 2020, and we expect further capacity rationalizations to be announced this year. In closing, we remain steadfast in the execution of our strategy, pursuing excellence in operations, investing for earnings growth with lower volatility and honoring our commitment to stockholder returns. We expect low-carbon fuel policies to continue to expand globally and drive demand for renewable fuels. And with that view, we're leveraging our global liquid fuels platform and expertise that comes with being the largest renewable diesel producer in North America to steadily expand our competitive advantage in economic low-carbon projects for a higher return on invested capital.

So with that, Homer, I'll hand the call back to you.

Homer Bhullar -- Vice President of Investor Relations

Thanks, Joe. For the fourth quarter of 2020, we incurred a net loss attributable to Valero stockholders of $359 million or $0.88 per share compared to net income of $1.1 billion or $2.58 per share for the fourth quarter of 2019. The fourth-quarter 2020 adjusted net loss attributable to Valero stockholders was $429 million or $1.06 per share compared to adjusted net income of $873 million or $2.13 per share for the fourth quarter of 2019. For 2020, the net loss attributable to Valero stockholders was $1.4 billion or $3.50 per share compared to net income of $2.4 billion or $5.84 per share in 2019.

The 2020 adjusted net loss attributable to Valero stockholders was $1.3 billion or $3.12 per share compared to adjusted net income of $2.4 billion or $5.70 per share in 2019. Fourth quarter and full-year 2019 and 2020 adjusted results exclude items reflected in the financial tables that accompany the earnings release. For reconciliations of actual to adjusted amounts, please refer to those financial tables. The refining segment reported an operating loss of $377 million in the fourth quarter of 2020 compared to operating income of $1.4 billion in the fourth quarter of 2019.

Excluding the LIFO liquidation adjustment and other operating expenses, the fourth-quarter 2020 adjusted operating loss for the refining segment was $476 million. Fourth-quarter 2020 results were impacted by narrow crude oil differentials, lower product demand and lower prices as a result of the COVID-19 pandemic. Refining throughput volumes averaged 2.6 million barrels per day, which was lower than the fourth quarter of 2019 due to lower product demand. Throughput capacity utilization was 81% in the fourth quarter of 2020.

Refining cash operating expenses of $4.40 per barrel were in line with guidance but $0.47 per barrel higher than the fourth quarter of 2019, primarily due to the effect of lower throughput rates. Operating income for the renewable diesel segment was $127 million for the fourth quarter of 2020 compared to $541 million in the fourth quarter of 2019. After adjusting for the retroactive Blender's Tax Credit in 2019, adjusted renewable diesel operating income was $187 million in the fourth quarter of 2019. Renewable diesel sales volumes averaged 618,000 gallons per day in the fourth quarter of 2020, a decrease of 226,000 gallons per day versus the fourth quarter of 2019 due to the effect of planned maintenance.

The segment set annual records for sales volumes of 787,000 gallons per day and margin of $2.66 per gallon. Operating income for the ethanol segment was $15 million in the fourth quarter of 2020 compared to $36 million in the fourth quarter of 2019. The ethanol production volumes averaged 4.1 million gallons per day in the fourth quarter of 2020, which was 197,000 gallons per day lower than the fourth quarter of 2019. The decrease in operating income from the fourth quarter of 2019 was primarily due to lower margins resulting from higher corn prices and lower ethanol prices.

For the fourth quarter of 2020, G&A expenses were $224 million and net interest expense was $153 million. G&A expenses in 2020 of $756 million were $112 million lower than 2019. Depreciation and amortization expense was $577 million and income tax benefit was $289 million in the fourth quarter of 2020. The annual effective tax rate was 45% for 2020, which was primarily the result of the carryback of our U.S.

federal tax net operating loss to 2015, when the statutory tax rate was 35%. And we expect to receive a cash tax refund of approximately $1 billion in the second quarter of this year. Net cash provided by operating activities was $96 million in the fourth quarter of 2020. Excluding the unfavorable impact from the changes in working capital of $113 million and our joint venture partner's 50% share of Diamond Green Diesel's net cash provided by operating activities, excluding changes in DGD's working capital, adjusted net cash provided by operating activities was $140 million.

And adjusted net cash provided by operating activities was $955 million for the full year. With regard to investing activities, we made $622 million of total capital investments in the fourth quarter of 2020, of which $214 million was for sustaining the business, including costs for turnarounds, catalysts and regulatory compliance; and $408 million was for growing the business. Excluding capital investments attributable to our partner's 50% share of Diamond Green Diesel and those related to other variable interest entities, capital investments attributable to Valero were $458 million in the fourth quarter of 2020 and $2 billion for the full year. Moving to financing activities, we returned $400 million to our stockholders in the fourth quarter of 2020 through our dividend and $1.8 billion through dividends and buybacks in the year, resulting in a total 2020 payout ratio of 184% of adjusted net cash provided by operating activities.

And our board of directors just approved a regular quarterly dividend of $0.98 per share, demonstrating our sound financial position and commitment to return cash to our investors. With regard to our balance sheet at quarter end, total debt and finance lease obligations were $14.7 billion and cash and cash equivalents were $3.3 billion. The debt-to-capitalization ratio, net of cash and cash equivalents, was 37%. And at the end of December, we had $5.9 billion of available liquidity, excluding cash.

Turning to guidance. We expect capital investments attributable to Valero for 2021 to be approximately $2 billion, which includes expenditures for turnarounds, catalysts and joint venture investments. About 60% of our capital investments is allocated to sustaining the business and 40% to growth. Almost half of our growth capex in 2021 is allocated to expanding our renewable diesel business.

For modeling our first-quarter operations, we expect refining throughput volumes to fall within the following ranges: Gulf Coast at 1.49 million to 1.54 million barrels per day, Mid-Continent at 410,000 to 430,000 barrels per day, West Coast at 170,000 to 190,000 barrels per day and North Atlantic at 245,000 to 265,000 barrels per day. We expect refining cash operating expenses in the first quarter to be approximately $4.75 per barrel, which is impacted by lower throughput volumes due to planned maintenance activity. With respect to the renewable diesel segment, we expect sales volumes to be 790,000 gallons per day in 2021. Operating expenses in 2021 should be $0.50 per gallon, which includes $0.15 per gallon for noncash costs such as depreciation and amortization.

Our ethanol segment is expected to produce 3.7 million gallons per day in the first quarter. Operating expenses should average $0.39 per gallon, which includes $0.06 per gallon for noncash costs such as depreciation and amortization. For the first quarter, net interest expense should be about $155 million, and total depreciation and amortization expense should be approximately $575 million. For 2021, we expect G&A expenses, excluding corporate depreciation, to be approximately $850 million, and the annual effective tax rate should approximate the U.S.

statutory rate. That concludes our opening remarks. Before we open the call to questions, we again respectfully request that callers adhere to our protocol of limiting each turn in the Q&A to two questions. If you have more than two questions, please rejoin the queue as time permits and please respect this request to ensure other callers have time to ask their questions.

Questions & Answers:

Operator

[Operator instructions] Our first question is coming from the line of Doug Terreson with Evercore ISI. Please proceed with your question.

Doug Terreson -- Evercore ISI -- Analyst

Good morning, everybody.

Joe Gorder -- Chairman and Chief Executive Officer

Good morning, Doug.

Doug Terreson -- Evercore ISI -- Analyst

Regarding refining fundamentals, Joe, you mentioned a minute ago that inventories are starting to shape up a little bit in close to five-year levels, I think, on an absolute basis. But they look like they're going to the same range adjusted for demand for both gasoline and distillate, which is a good thing. Margins are near year-ago levels in most U.S. markets, and we're starting to see feedstock differentials widen, too.

So my question is, have you been surprised by the pace of the recovery that we've seen? Do you think there's reason to believe that it's sustainable? And either way, what's your overall view for the recovery in refined products market for 2021? What's your outlook at this point?

Joe Gorder -- Chairman and Chief Executive Officer

Doug, that's a good question. We'll let Gary and Lane speak to it in some detail. But I mean, we've been pleased with the pace of the recovery so far. And frankly, I think you're going to see it accelerate as the vaccine rolls out more aggressively.

That's kind of an obvious statement. But I think sometimes, we do take it for granted. If we can really get the government functioning appropriately on the distribution, I think we're going to be in much better shape, perhaps quicker than we all realized. And we've got a member of our board of directors who thinks that there's such pent-up demand certainly in the East Coast where he is and other parts of the country that when we do get the vaccine rolled out and we get a herd immunity in place, you're going to see this look a little bit like the roaring '20s, and that's his point of view.

And I would tend to agree with that. So with that, I'll let Gary and Lane provide a little more color specifically regarding the inventories and demand.

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

Yeah, Doug, this is Gary. Certainly, getting total light product inventory, we built a significant surplus, especially early on in the pandemic. So seeing that surplus essentially gone and getting back into the five-year average range is very encouraging. As you know, as demand starts to pick up, it will allow margins to recover much quicker.

I think encouraging -- another encouraging sign is the fact, despite the fact that we've had a surge in COVID cases, gasoline demand per the DOEs is still a little bit above 90% year over year where it was last year at this time. Our wholesale volumes are showing to be pretty close to that. And so the combination of reasonable gasoline demand and relatively low gasoline inventories has caused the prop market to be a little stronger. I think one of the key things there is the stronger prop market has really flattened the curve on gasoline.

And so it's taking away a lot of that incentive to store summer-grade gasoline, and that certainly sets up for a stronger driving season in terms of gasoline margins. As Joe said, I think we view that we'll see gradual recovery. Second quarter, you'll start to see things pick up and then we expect things to be fairly normal by the third quarter, with the exception that we do see that there could be a lot of pent-up demand and people that are spending disposable income largely buying things that they're ordering are going to spend that disposable income getting out and on experiences, family vacations, which could cause a surge in gasoline demand. On the diesel side, as you kind of mentioned, diesel demand has really hung in there pretty strong.

So the OEs are showing over 98% year-over-year diesel demand. Actually, at the seven-day average on our system, we were at 111% year over year, so actually showing diesel demand growth in our system. I think some of that heating oil demand has been strong, a little bit colder winter this year, starting to see some drilling activity pick up, which, of course, helps diesel demand. And then, of course, with people spending disposable income ordering things, freight, on-road freight, trucking and rail has been strong as well.

As we move throughout the year, we expect to see some incremental diesel demand coming from ag as you start to plant crops. And then moving throughout the year, we also see that as jet demand begins to recover, it will lower diesel yields and help bring supply and demand into balance, which will set diesel up nicely longer term.

Doug Terreson -- Evercore ISI -- Analyst

OK. Good points. So that kind of covers it for me. It sounds fairly encouraging.

Joe Gorder -- Chairman and Chief Executive Officer

Yeah, Doug, I mean, look, we are encouraged. I mean, I think we're through the worst of this, and we're looking forward to getting back to more normal lifestyles here and certainly a more normal business climate. But let me just say one thing before you get off. I understand that you're going to be repositioning this spring.

And we've known each other for a very long time. And I'd be remiss if I just didn't say that without question, your wisdom and insight in this sector is unsurpassed. But more importantly than that, Doug, you're a very good man, and we're all better people for having had the opportunity to get to know you and to work with you over the years. And I, for one, am going to miss you greatly.

So I know we're going to have a chance to visit here sometime in March, but look, I just want to -- on behalf of the whole Valero team, I think we just want to wish you the best and tell you, thanks for everything you've done for the industry over the years.

Doug Terreson -- Evercore ISI -- Analyst

Well, Joe, thank you too. I mean you guys have been capital management leaders, especially in this industry. Your stock reflects it over time, and you all are good guys, too. And so you've been a really easy management team for me to support over the decades.

And I just want to thank you for your leadership and really enjoyed our time together. And so you guys pat yourselves on the back because you deserve the performance that has been demonstrated in the stock market for sure. Thanks again, Joe.

Joe Gorder -- Chairman and Chief Executive Officer

Bless you, buddy.

Operator

Thank you. Our next question is coming from the line of Phil Gresh with J.P. Morgan. Please proceed with your question.

Phil Gresh -- J.P. Morgan -- Analyst

Hey, good morning. Tough follow-up.

Joe Gorder -- Chairman and Chief Executive Officer

Well, hey, Phil, you're still a young guy. You'll get yours one day, but it probably won't be from me.

Phil Gresh -- J.P. Morgan -- Analyst

I guess, I'll follow-up on one part of Doug's question there, just on the differential side. You talked a lot about the product margin element differential as obviously still pretty tight here, especially like on light and heavy. So how do you guys see that playing out for the rest of the year?

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

Yeah, Phil, this is Gary. I think we have seen very narrow crude quality differentials. In order to get those widened out, we need more OPEC barrels on the market. If you look at most consulting forecast, they're showing global oil demand growing to the point where you'll need at least 3 million barrels a day of additional OPEC production online by the end of the year.

And so I think our view is probably the back half of the year is where you'll see quality differentials begin to widen out. I think that's further supported by if you look at the high-sulfur fuel oil forward curve, where high-sulfur fuel have been trading around 90% of Brent, you look to the back half of the year, and it gets more to 80% of Brent, which is more indicative that we'll see those quality differentials widen out again, kind of the second half of the year.

Phil Gresh -- J.P. Morgan -- Analyst

Got it. OK. And then the second question, just trying to think through the capital spending cadence over these next few years with Phase 3 of Diamond Green Diesel. Obviously, you talked about a $2 billion spending level for 2021 being able to hold, despite still some spending for Phase 2.

So as you look out to '22 and '23, do you think you can do the Phase 3 project within the $2 billion or so capital budget as well? I'm just trying to gauge the free cash flow potential as we see the refining margins recover and DGD EBITDA come on.

Lane Riggs -- President and Chief OperatingOfficer

Hey, Phil. This is Lane. So we did about $2 billion last year, actually a little bit less than that. We maintained our pace on spending on Diamond 2 and developing Diamond 3 and we believe that we can continue to do that.

If, for whatever reason, the world's -- the cash is a little bit lower, obviously, we want to get back to some other things at some point. But we can certainly maintain our spend on renewable diesel with our capital budget at a $2 billion level.

Joe Gorder -- Chairman and Chief Executive Officer

Yeah. And Phil, just -- I mean, from a broader strategic perspective, this $2 billion to $2 billion number is our target going forward, OK? I don't think you should expect that we're going to go out and spend $3 billion in a year. So we've said that timing of capital spend isn't necessarily calendar year spending. And so some years, it might be less than $2 billion as it was this year.

In some years, it's going to be a little bit more than $2 billion. But the target range for us remains in that $2 billion to $2.5 billion range. And I think it will stay in this $2 billion range through 2021.

Phil Gresh -- J.P. Morgan -- Analyst

Got it. OK, thanks so much.

Operator

Thank you. Our next question comes from the line of Prashant Rao with Citi. Please proceed with your question.

Prashant Rao -- Citi -- Analyst

Hi, thanks for taking the question. Good morning, all.

Joe Gorder -- Chairman and Chief Executive Officer

Good morning, Prashant.

Prashant Rao -- Citi -- Analyst

I just wanted to follow up on the RD market and its evolution. Particularly outside of BTC, outside of D4 RINs, which I expect other people are going to ask about. But I'm curious about the LCFS market in California and some of the other provincial and regional opportunities that we've talked about. I wanted to get your thoughts, specifically in California.

It seems like there's a lot of competing sources of capital. This pandemic has progressed capital toward sort of emerging energy. And while they're small now, there's a possibility for a little bit more electrification, more renewable gas, other competing sources for that credit or for diesel substitutes in California. I was just wondering, given the supply coming online with Port Arthur and your longer-term plans, how do you see that playing out in California? Is it fair to say that by the time DGD 3 is up online, there might be a more meaningful opportunity outside of the California LCFS? And how do you see the pace of that over the next few years? The other part of that also being, do you expect that California could reduce -- they could increase the emissions reduction target, which would just move the goalpost and create a greater opportunity? So there's a lot of pieces moving there, but the market's changed quite a bit since we were talking about this pre-COVID.

So I just wanted to get an update on how you see those moving parts playing out.

Martin Parrish -- Senior Vice President, Alternative Energy and Project Development

Sure. Prashant, this is Martin. On California, obviously, the market has been pretty stable as far as the carbon price the last few years. And then the renewable diesel is the largest carbon generator.

You step outside California, I'll answer that part first. What we expect to happen in the next few years is the clean fuel standard to be in place in Canada by the end of 2022. That will bring incremental demand in 2023. We've also got legislation in New York State and Washington State for LCFS programs.

And we think those states will implement an LCFS over the next few years. Timing of that is hard or impossible to predict, but we expect that's going to happen. Today, we sell to California, but we also sell to Canada and Europe. So I mean, you're right, there's some electricity penetration, there's renewable natural gas.

But still, renewable diesel is the largest carbon credit generator. We don't expect that to change in the foreseeable future. And as far as the trucking, that's going to continue. Renewable diesel, obviously, is huge in that.

California, if you look at their projections, they're heading for -- in 2030, their internal projections are like a 40% blend rate for renewable diesel. We honestly think it might even be higher than that. So there's really -- there's no blend wall. There's nothing to stop this.

So we're optimistic about demand in California, and we're optimistic about demand in other parts of the globe.

Prashant Rao -- Citi -- Analyst

Thanks, Martin. And then just a follow-up on that, recently, we've been hearing in the headlines, there's been some in the financial community who talk about -- who have been saying, advocating for a need for a higher carbon price in order to incentivize the move to emissions reduction. And obviously, California has had a higher per ton price than other parts of the developed world. But do you think that -- is it too early to say that there's some maybe -- that gives the $200 per ton carbon price in California a little bit more legs to be sustainable as the rest of the world is going to come up? Or do you see sort of a meeting in the middle? How do you see that evolving, given where the narrative and where the discussion is right now?

Martin Parrish -- Senior Vice President, Alternative Energy and Project Development

Yeah. I'd say, first thing, you have to be a little careful looking at the absolute price because it depends on whether it's a low-carbon fuel standard or a carbon tax. You get to a lot of different carbon prices in those different regimes. But I think with California, they've obviously signaled they're OK with $200.

And they're OK with that escalated by the CPI each year. If things happen where that price started going down, I would expect California to move the goalpost and make it harder. We're looking at a carbon reduction at 20% by 2030 now. But if you start having the carbon price go down a lot of credits, I think they're going to move the goalposts because that's the objective, right?

Prashant Rao -- Citi -- Analyst

Yup. Make sense. Thank you. Appreciate the time.

Operator

Thank you. Our next question comes from the line of Manav Gupta with Credit Suisse. Please proceed with your question.

Manav Gupta -- Credit Suisse -- Analyst

Hey, guys. In the energy industry, what you generally see is projects getting delayed by six months or 12 months. You're doing something unique. DGD is starting up six months before expectations.

Just trying to understand from the perspective of engineering, feedstock securement, how are you able to achieve a start-up before time in this case?

Lane Riggs -- President and Chief OperatingOfficer

Hi, Manav. This is Lane. So we obviously are very, very focused on this project, and we did accelerate because if you look at our spend, we spent more than what we actually budgeted to try to keep -- to try to -- as we are executing that project to find every step we can to optimize and accelerate the schedule and not do so by accelerating the cost of the project either. So as you've mentioned, we are -- we have worked it really, really hard because it is such a good project, and it is a big cash flow generator for us.

So it's really -- we have expertise in terms of project execution. We understand -- and Diamond 3 is essentially a duplicate of Diamond 2 and with a few revisions here and there, but it's largely -- so we've been able to accelerate that project as well. And we just -- because of our focus, we put our best people on making sure that project moves along as fast as it can.

Manav Gupta -- Credit Suisse -- Analyst

A quick follow-up here, Lane. Obviously, wind prices have moved up. I'm trying to understand how the start-up of DGD 2 and then following up DGD 3 actually cut your RVO obligation, which would give us some idea what the RVO obligation is right now? And then how much lower does it go once both the DGD phases are online?

Joe Gorder -- Chairman and Chief Executive Officer

Sorry, we're looking, Manav, to see if Martin or Gary...

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

I think what you have to think about there, Manav, is you've got the obligation but you've got a lot of factors right now. And RIN prices right now are probably more influenced by the SRE and the Supreme Court and what the EPA is going to do. And I don't know that it's really so much about the fundamentals as the uncertainty at this point.

Martin Parrish -- Senior Vice President, Alternative Energy and Project Development

It doesn't change our renewable volume.

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

No, that's right. Yeah. So it doesn't change our renewable volume obligation at all. And I agree with Martin, the uncertainty around SREs and just what will happen on the Biden administration is really what's causing the RINs prices to surge.

Manav Gupta -- Credit Suisse -- Analyst

Thank you for taking my questions.

Joe Gorder -- Chairman and Chief Executive Officer

You bet.

Operator

Thank you. Our next question comes from Theresa Chen with Barclays. Please proceed with your question.

Theresa Chen -- Barclays -- Analyst

Good morning. I wanted to follow up on the renewable diesel side. So in terms of feedstocks, in a quarter where feedstock costs seem to have risen sharply and with planned maintenance at the facility, your capture was still very high. Can you talk about how you were able to achieve that? Is that sustainable? If there were any onetime factors that might have benefited the quarter? And going forward, as you think over the long-term about feedstock costs, just given the onslaught of projects that are under development, but to Manav's point now, even if not all of them will meet the time frame and capacity as originally planned, the absolute supply of renewable diesel will likely increase.

And thus increasing competition for feedstocks. And as such, do you see a shift in the type of feedstocks versus what you're currently using?

Martin Parrish -- Senior Vice President, Alternative Energy and Project Development

OK. Sure. Soybean oil was up 17% in the fourth quarter versus third quarter. But as you noted, our EBITDA per gallon margins were flat quarter on quarter.

If you look back in the past three years on renewable diesel, we've experienced wide swings in feedstock costs, RINs prices, D4 RINs, ULSD prices, obviously, a huge swing there. However, our annual margins have been very consistent, ranging from $2.19 a gallon in 2018 as a low to a high of $2.37 a gallon in 2020. So you can see that the earnings power is there and consistent kind of regardless. And that's because the market works to compensate.

If that prices go up, the RIN goes up anyway. So it all kind of works in concert there. So long-term in the next foreseeable future, let's say, we're not concerned with sourcing feedstocks. We believe our margin history is a good indicator of what to expect over time.

Any one quarter can be plus or minus, but over time, we feel good about this margin indicator. Then if you look to what happened with the soybean price, well, soybean price is driven by global supply and demand of veg oils. Palm oil prices were first to move up because production growth slowed in Indonesia and Malaysia due to a drought and COVID-19, a lack of labor to harvest the palm. Now you've got soybean production is pretty tight this year.

So I worry about a lower crop down in Brazil. Soybean oil production is going to be impacted. You've got the kind of the whole ag commodity index moving up, so that's moving up soybean oil too. And then finally, veg oil pricing was low as compared to ULSD in 2018 and '19.

So we expected some upward movement relative to ULSD. In response to this, more vegetable oil will be produced in response to higher prices. And we don't see a long-term sustainable shift in vegetable oil pricing relative to low-sulfur diesel.

Theresa Chen -- Barclays -- Analyst

Thank you. And on the broader topic of energy transition, since the Biden administration took office and made a series of very aggressive climate-related policy announcements, can you talk about how this plays out? How you think this plays out for the industry in general from the perspective of CAFE standards, emissions, EV penetration, renewable fuels, etc.? And particularly, what do you think the next step will be?

Joe Gorder -- Chairman and Chief Executive Officer

Yeah, sure. And we'll tag team this. I mean, Rich Walsh can cover kind of the policy side of this. But I mean, we have seen -- and we've seen it for sometime now.

The headlines are all focused on EVs, right? And everyone takes that into consideration when they're looking at the long-term outlook for oil demand going forward. And we just need to continue to look at the facts and keep it in perspective. EV sales last year made up slightly less than 2% of domestic car sales and just around 4% globally. And I think if you look forward to developing countries, their focus is a whole lot less on climate change and EVs than it is in feeding their people and providing safe and affordable housing for them.

So there's a lot going on politically, but the reality is that cleaner fuels are going to be part of the future, EVs will be part of the future. But it's far from -- the internal combustion engine is far from being extinct. And so that's one thing that we have to all keep in mind, I think, as we go forward. We're still selling a tremendous amount of internal combustion engines that are more efficient.

And our industry has done a fine job of working projects and adjusting operations to reduce the carbon intensity of the products that we're producing. And frankly, Valero, as you know, is doing a lot of that with the renewable diesel projects that we've undertaken. We're also doing it with carbon sequestration around our ethanol business. We're looking at hydrogen and so on.

So anyway, there's a lot going on here, and I think we'll continue to see overall the carbon intensity of traditional fuels, liquid fuels go down. And honestly, you can tell from our IR deck that already, we're very competitive from a renewable diesel perspective with an EV. And I think you'll see that continue to increase. So I'll stop there.

Rich, on the policy side?

Rich Walsh -- Senior Vice President, General Counsel

Yeah. I mean, Joe's right. I mean, we -- of course, you see a lot of headlines on it. I mean, yesterday, they came out with an announcement on moving the federal fleet to EVs.

But we point out, that's very similar to the order that -- the executive order Obama issued in 2015, mandating that half of the fleet become EVs. And we didn't see a lot of movement in the federal fleet to EVs under that order. And it's a lot more difficult than you think to do that. The other thing that I would really like to emphasize is our renewable diesel can drop in today and, on a life cycle basis, outperforms an equivalent diesel electric truck.

So we can help the administration address this climate issue straight away. This order did call for clean and zero-emission vehicles, and ours are certainly clean. The other thing I'd point out, even in that order, you have to read the fine print. It requires that it be made in America and meet the federal procurement standards.

And I'm not sure there's a lot of electric vehicles that can meet those requirements, but our renewable diesel is 100% American made, and it's ready to go now. So we actually think that a lot of this will be, in the end, the economics are overwhelming for our products. And they're ready to go now. So we think we can work with the administration.

We think there is going to be demand and policy drivers for lower carbon fuels, but we think that's a good thing for us. So.

Theresa Chen -- Barclays -- Analyst

Thank you.

Operator

Thank you. Our next question comes from the line of Doug Leggate with Bank of America. Please proceed with your question.

Doug Leggate -- Bank of America Merrill Lynch -- Analyst

Thanks. Good morning, everybody. Joe, Happy New Year. I think it's the first time you've spoken this year.

Joe Gorder -- Chairman and Chief Executive Officer

Yeah, it is, Doug. Same to you.

Doug Leggate -- Bank of America Merrill Lynch -- Analyst

Well, when I heard Doug and repositioning earlier, I thought I was looking over my shoulder thinking someone hadn't told me something. But you made me a little nervous there. But anyway...

Joe Gorder -- Chairman and Chief Executive Officer

I'd say the same about you, Doug.

Doug Leggate -- Bank of America Merrill Lynch -- Analyst

Well, we've passed our congrats along to Doug. He's one of the oldest analysts in this sector, so I'm not sure I'm grateful for that, but so will he. Anyway, so guys, two questions, please. I actually just want to start with a quick housekeeping question.

Homer mentioned the $1 billion cash tax refund, not immaterial, obviously. I just wanted to double check. Is that a one-off? Or are there any other retrospective cash tax losses you can bring forward?

Mark Schmeltekopf -- Chief Accounting Officer and Senior Vice President -- Analyst

This is Mark Schmeltekopf. That is a one-off item. Obviously, it relates to our 2020 tax NOL that's being carried back to 2015, and that's the only significant item like that.

Doug Leggate -- Bank of America Merrill Lynch -- Analyst

OK. I just wanted to double check. Thank you. My follow-up, Joe, is probably a little bit more, I guess, it's more high level.

You've talked a lot about EVs. I love that slide in your latest deck about the myth. I'm just curious though. Carbon sequestration on your ethanol business, where does that sit on the potential carbon capture on the refining business? Is that something you're pursuing? Will pursue? Is it part of the discussion? I'm just curious as to how you address what your next steps are and what's already been some very significant moves to reduce the carbon footprint of your fuels.

Just what should we expect from Valero next in that regard?

Lane Riggs -- President and Chief OperatingOfficer

So Doug, this is Lane. I'll take a shot at that. So the reason we choose some of these projects like the ethanol plants, it has to do with the gas that's coming off that plant is largely carbon dioxide. So it's -- we're not having to further treat it before we find a way to sequester it.

So we're trying to understand that, how that works, try to understand the technology and now certainly all the policy and all the other sort of the regulatory regime that's going to be around carbon sequestration. So it's a good place for us to really start and develop projects. The other way that we can do this is with our blue and green hydrogen. We're gating projects in that, that will also affect the carbon intensity of our transportation fuels.

Some of which we've done, smaller ones, but we are certainly getting some larger ones that will make our transportation fuels. Depending on what market we can target them in, we'll obviously be helped with the overall -- our competitiveness from a carbon intensity perspective will help us. So those are all -- those are the things that we're looking at. But I think, again, we're trying to hit from a carbon sequestration perspective, we're trying to hit the streams that we see that are lower in carbon dioxide on that gas and maybe just in that, when something has been combusted, it has a lot of other stuff in it like basically nitrogen and some other things, so.

Doug Leggate -- Bank of America Merrill Lynch -- Analyst

All right, guys. So that's my two, so I'll be respectful to everyone else. I'll see you all in March. Thanks, again.

Joe Gorder -- Chairman and Chief Executive Officer

Thanks, Doug.

Operator

Thank you. Our next question comes from Roger Read with Wells Fargo. Please proceed with your question.

Roger Read -- Wells Fargo Securities -- Analyst

Yeah, thanks. Good morning.

Joe Gorder -- Chairman and Chief Executive Officer

Hey, Roger.

Roger Read -- Wells Fargo Securities -- Analyst

Guys, I guess two questions. I want to follow up on your introductory comments, Joe. And the second one is a follow-up to some of the questions Theresa was asking about renewable diesel feedstock. So the first one, on the global capacity kind of expectation of future shutdowns.

Just curious how you see that unfolding, maybe where you see that unfolding? Any particular trigger points? And then on the renewable diesel feedstock, specific to your Phase 2 and your Phase 3 plans here that will roll out in '21 and '23 -- or end of '21 and then in '23. How comfortable you are in terms of your line of sight to the necessary feedstocks in terms of the geographic Gulf Coast focus you have?

Joe Gorder -- Chairman and Chief Executive Officer

OK. So which one of you guys wants to talk about the first one, the closures?

Lane Riggs -- President and Chief OperatingOfficer

I guess that will be me. Hey, Roger, it's Lane. So we've talked about this a little bit on some of the prior earnings calls. First, we've seen about 3 million barrels a day of refining closures.

I think that we've been -- I don't know, and I don't want to say pleasantly surprised, but certainly surprised at the acceleration of some of these closures. And interestingly, a lot of it's occurred in the United States. I think that's a little bit of a surprise to us. But we've kind of done, I would say, our share or at least -- it doesn't mean that we won't have further closures potentially in the Atlantic basin on this side of the pond or maybe on the West Coast.

But certainly, we -- for now, in the United States, we've done I think about 800,000 to 900,000 barrels a day of announced closures. I think if we look at trade flow though, where the closures -- you could look for the closures going forward is primarily Europe, particularly Southern Europe. It has -- they don't really have access to an advantaged crude. They're more aggressive on -- with respect to their transition away from transportation fossil fuels.

So I think that's where you'll see more and more -- that will be where you'll see more closures going forward.

Joe Gorder -- Chairman and Chief Executive Officer

Martin, do you want to take the second half?

Martin Parrish -- Senior Vice President, Alternative Energy and Project Development

Sure. On the feedstocks, Roger. Right now, what we're looking at line of sight to 2023, we feel very about procuring these waste feedstocks that we need. If you look at it now, the United States, as far as used cooking oil production and metallo production, they're large.

U.S. is the biggest around that. The -- and that comes with even GDP per capita and plus established rendering operations and everything else. So we feel good about that into the future.

If you look, we think the U.S. is the place to be. The installed base of renewable diesel is still pretty small, especially the guys that are running the waste feedstock and pretreatment unit. And there's plenty of waste feedstock just to procure.

As you look further down the road, you get past 2025 out to 2030, we expect to see quite a bit of growth in used cooking oil production and then the animal rendering. And a lot of that's going to come from Asia at that point because that's where the population growth is. But historically, this waste feedstocks growth has been pretty significant. And we expect that to continue.

So line of sight out through DGD 2 and 3, we don't see a problem.

Roger Read -- Wells Fargo Securities -- Analyst

OK, thank you.

Joe Gorder -- Chairman and Chief Executive Officer

Roger, we just -- I wanted to compliment you on your recent piece of work on the EV expansion and oil demand. That was well done, very thoughtful and well done. And I would encourage everybody, if you haven't seen it, to take a look at it.

Roger Read -- Wells Fargo Securities -- Analyst

I appreciate that. And sometimes, when people have referred to me as a piece of work, it wasn't a compliment.

Operator

Thank you. Our next question is coming from the line of Paul Cheng with Scotiabank. Please proceed with your question.

Paul Cheng -- Scotiabank -- Analyst

Hey, guys. Good morning.

Joe Gorder -- Chairman and Chief Executive Officer

Good morning, Paul.

Paul Cheng -- Scotiabank -- Analyst

I had two questions that maybe this is for Joe. I mean, Lane was earlier talking about Europe, maybe more facility is going to get shut. So how we should look at the government policy and everything and put it into plan books? And then how are we going to position on the longer term? So that's the first question. And second question that at some point, the pandemic will over and you will generate free cash again.

And at that point, when we're looking at your financial strategy, you have add several billion-dollar debt for this pandemic. We assume that you're going to first trying to pay it down. But after the pandemic, if we're looking forward, will the company take a more conservative approach and even drive down the debt ratio much below the pre-pandemic level?

Joe Gorder -- Chairman and Chief Executive Officer

That's good, Paul. OK. We'll let -- I'll let Jason take the second part, and you directed the first one to me. Relative to Pembroke -- and Lane, you can chime in on this too, and Rich Walsh.

But when you look at Pembroke, it supplies domestic demands within the U.K., and it also supplies Ireland and other countries. So we do export out of Pembroke. We bring fuels to Canada when we need them out of Pembroke and so on. And so it's one thing for politicians to come out and lay down a hard line and say that they're going to do something.

But there's human beings in that country as there are in our country who have purchased internal combustion engine vehicles, and they have an opportunity to weigh in on these issues and these decisions going forward. So Paul, I think we all get very concerned when we hear these things. But if you just go back historically and look at how things play out, they don't always turn out exactly the way that we fear, OK? It's usually never as bad as we think and never as good as we think. And I think that's certainly the case here.

But we have a clear focus on Pembroke. And Lane and his team are working on different options and different projects that are going to continue to make that a more efficient operation. So Rich, anything you guys would add to that?

Rich Walsh -- Senior Vice President, General Counsel

No. I mean, I think you said it really well. I mean if you look at -- like if you just take a look at say, California, you saw in their early announcements that were very aspirational about how they were going to drive down carbon. And we'll see directionally efforts to move in this way, and you're going to see increased electrification in these countries.

But as you get closer to these deadlines, what you tend to see is that the practicalities of this start to have an effect, and then they tend to move the target and reset the goals. And so right now, there's a big drive on this. And the cost and the consequences of it will start to play out, and it will influence the policy going forward. I think that's the best way I can describe it.

Lane Riggs -- President and Chief OperatingOfficer

Hi, Paul. This is Lane. I'll just add one thing. When we're talking, the key to that is trade flow and what we've always thought was more Southern Europe that's going to be more exposed to closures, just because of where they're located in Europe and where the trade flow in crude is.

Joe Gorder -- Chairman and Chief Executive Officer

And Jason, do you want to take the financial piece?

Jason Fraser -- Executive Vice President and Chief Financial Officer

Yes, sure. I mean, you're correct. One of our more immediate goals will be paying down some of the extra debt we've taken on during the pandemic and as far as like our base assumption on debt-to-cap is 20%, 30% debt. But we are in a very dynamic time, right? We have energy transition going.

We're growing our renewable diesel business, we're aggressively looking at other technologies. So exactly how we end up participating in it and the capital needs of these new businesses may dictate a different structure. We're open to looking at things, and we recognize we're in a very a dynamic time, which is exciting. And so we're not wed to that.

We'll keep our minds open and see as things evolve.

Paul Cheng -- Scotiabank -- Analyst

Thank you.

Joe Gorder -- Chairman and Chief Executive Officer

Take care, Paul.

Operator

Thank you. Our next question comes from the line of Ryan Todd with Simmons Energy. Please proceed with your question.

Ryan Todd -- Simmons Energy -- Analyst

Thanks. Maybe one quick follow-up on the renewable side. Sustainable -- sorry, sustainable aviation fuel is clearly going to play, I think, a large role in this mix going forward over the longer term. It's very small at this point.

Can you talk a little bit about what you see as kind of the necessary steps to ramp up the sustainable aviation fuel market and how your renewable diesel facilities are positioned to be able to produce it?

Martin Parrish -- Senior Vice President, Alternative Energy and Project Development

Sure. This is Martin. I think the necessary step to ramp it up is really some -- you're going to have to get some mandates to require the use of it across the globe. Right now, it's out there.

Is it going to happen? Yes, we feel pretty confident it's coming, but it's a big question of when. The modifications required at a plant that's producing renewable diesel to produce a sustainable aviation fuel, they're significant, but they aren't huge. So we could pivot there when we need to pivot there. We'll obviously keep paying close attention to that and doing engineering on options, but it's really about getting some mandated volume out there.

Ryan Todd -- Simmons Energy -- Analyst

OK, thanks. And then maybe just one, I mean you touched on parts of this earlier, but maybe just an overall follow-up on refining capture. I mean you talked about how headline margins have balanced here recently. It feels like capture has stayed kind of stubbornly low on the refining side for the entire industry.

Can you talk to me how you see some of those trends playing out over the course of the year? It sounds like maybe you expect RIN pricing to soften up some and differentials to widen out a little bit. Any thoughts on how -- and the timing of that recovery over the course of the year?

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

Ryan, this is Gary. I think the key for us, as you know, we pride ourselves on our ability to optimize our refining system, especially on the feedstock side of the business. And with the very narrow crude quality differentials, it's been challenging to do that. So you get to the second half of the year and more OPEC production on the market, potential easing of Venezuelan sanctions, potential easing of Iranian sanctions, all those things will allow us to do more optimization on the feedstock side.

And as we do that, our capture rates would go up.

Ryan Todd -- Simmons Energy -- Analyst

Thanks, guys.

Joe Gorder -- Chairman and Chief Executive Officer

Thanks, Ryan.

Operator

Thank you. Our next question comes from the line of Benny Wong with Morgan Stanley. Please proceed with your question.

Benny Wong -- Morgan Stanley -- Analyst

Hey, good morning guys. Thanks for taking my question.

Joe Gorder -- Chairman and Chief Executive Officer

Good morning, Benny.

Benny Wong -- Morgan Stanley -- Analyst

I hope you're all well. Hey Joe, in your prepared remarks, you highlighted your international strategy moving forward with the Veracruz terminal now started. Just curious if you can give us an update on the demand and margin outlook you're seeing in Lat Am generally and maybe in Mexico specifically. Wanted to get a sense in terms of where they are in demand recovery and if there's any notable differences across regions that you're able to see?

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

Yes. So this is Gary. As Joe mentioned, we did put the Veracruz terminal online at the end of the year. We have both gasoline and diesel and tankage in Veracruz today.

We're still doing some commissioning activity. So we expect to have the truck rack operational in the next couple of weeks. Overall, our volumes for the quarter in Mexico were a little over 40,000 barrels a day. That's an increase of about -- year over year, 145%.

So good growth in the country. However, from the third quarter to the fourth quarter, we were down about 10%. The mobility data we see in Mexico is mobility was down about 20%. So still indicates we're continuing to gain market share, but we did see a big hit in mobility in Mexico, and we saw that reflected in our volumes.

Moving forward, I mean, our -- we anticipate that the inland terminals associated with the Veracruz marine terminal probably come online early second quarter, one at Puebla and one in Mexico City. And that's really where you'll start to see our volumes ramp up as those inland terminals come on. Our goal is to get to about 80,000 barrels a day in that central system. The other thing that the Veracruz terminal does is it takes a lot of cost out of our supply chain.

So in addition to the ramp-up in volumes, we would also expect to see wider margins on the volume that we're selling in country.

Benny Wong -- Morgan Stanley -- Analyst

Great. Thanks guys. That was all my question. Appreciate the time.

Joe Gorder -- Chairman and Chief Executive Officer

Thanks, Benny.

Operator

Thank you. Our next question is coming from the line of Sam Margolin with Wolfe Research. Please proceed with your question.

Sam Margolin -- Wolfe Research -- Analyst

Hello. Good morning, everyone. My question is on the operating side. Your first quarter throughputs are sort of flat quarter-over-quarter, at least in the Gulf Coast.

And so I'm just wondering, as we kind of enter this recovery phase and like you said, crack spreads are even starting to pick up a little bit here concurrently with demand, how do you balance what you see on the commercial side with your operating rates? How much you want to ramp utilization versus what your assessment is of what the market can tolerate and various sort of commodity scenarios? I'm just curious how you work through that as you think about utilization.

Lane Riggs -- President and Chief OperatingOfficer

Hey, Sam. This is Lane. I'll take a shot and maybe Gary can follow-up if there's anything. We're certainly positioned in the Gulf Coast.

If recovery -- if things recover quicker, then our rates could be higher. But we're trying to be -- we're obviously being very careful in trying to not get our supply line chain very extended. So we have strategies around that, trying to think about -- make sure that we don't have a lot of pricing exposure and trying to position our assets sort of in a conservative posture just to make sure that we're well positioned going into this. But we can certainly raise rates as the -- if we see things getting better.

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

Yeah. And I would just tag on to that. I think the key for us is looking at it again and especially if we're able to ramp up utilization and it results in higher exports, and we have good margin to do that, we feel comfortable raising utilization.

Sam Margolin -- Wolfe Research -- Analyst

OK, thanks. And then one follow-up, if I might, just on an energy transition theme. And specifically EVs, there's a certain amount of petroleum products that are in EVs, along with sort of other materials and processes that are associated with the energy transition. So the question is, you guys can make anything -- they might not be things you're focused on today, but you weren't necessarily focused on renewable diesel until you figured out the right way to build and structure that business.

So looking out over the horizon, maybe not over the immediately investable horizon, how do you think about the potential to kind of remix your product streams into things like specialty chemicals or other materials that are sort of more thematic, if not necessarily, today, over your investment hurdles? Thank you.

Lane Riggs -- President and Chief OperatingOfficer

So Sam, I'll take it. This is Lane. We've looked quite a bit at diversifying into petrochemicals. We continue to look at it.

We have a -- it's just -- it hasn't met our gating threshold. So we would -- but we're going to continue to look at it because, obviously, it's something that we could do. It's not too far out of our wheelhouse to do. But so far, when we do a lot of these things, we haven't found them to be better than some of our other projects.

For example, renewable diesel projects, right? I mean, in a world where we're going to put money, we -- that's today, that's where we put our money instead of sort of petrochemical path. But it doesn't mean that we are not -- we're closed to the idea. But certainly, we like our investments in sort of this lower -- this carbon transition in terms of trying to lower the carbon intensity of transportation fuels.

Sam Margolin -- Wolfe Research -- Analyst

Thanks so much.

Joe Gorder -- Chairman and Chief Executive Officer

Thanks, Sam.

Operator

Thank you. Ladies and gentlemen, we have reached the end of our allotted time for the Q&A session. At this point, I would like to turn the floor back over to Mr. Bhullar for any additional concluding comments.

Homer Bhullar -- Vice President of Investor Relations

Great. Thank you. Appreciate everyone joining us. And for those that didn't get a chance to ask a question, please feel free to contact me.

I'm happy to chat with you. Please, everyone, stay safe and healthy, and have a great day. Thank you.

Operator

[Operator signoff]

Duration: 64 minutes

Call participants:

Homer Bhullar -- Vice President of Investor Relations

Joe Gorder -- Chairman and Chief Executive Officer

Doug Terreson -- Evercore ISI -- Analyst

Gary Simmons -- Executive Vice resident and Chief Commercial Officer

Phil Gresh -- J.P. Morgan -- Analyst

Lane Riggs -- President and Chief OperatingOfficer

Prashant Rao -- Citi -- Analyst

Martin Parrish -- Senior Vice President, Alternative Energy and Project Development

Manav Gupta -- Credit Suisse -- Analyst

Theresa Chen -- Barclays -- Analyst

Rich Walsh -- Senior Vice President, General Counsel

Doug Leggate -- Bank of America Merrill Lynch -- Analyst

Mark Schmeltekopf -- Chief Accounting Officer and Senior Vice President -- Analyst

Roger Read -- Wells Fargo Securities -- Analyst

Paul Cheng -- Scotiabank -- Analyst

Jason Fraser -- Executive Vice President and Chief Financial Officer

Ryan Todd -- Simmons Energy -- Analyst

Benny Wong -- Morgan Stanley -- Analyst

Sam Margolin -- Wolfe Research -- Analyst

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