Good day, everyone, and welcome to the PBF Energy Fourth Quarter and Full Year 2023 Earnings Conference Call and Webcast. At this time, all participants are placed in a listen-only mode, and the floor will be open for your questions following management's prepared remarks. Please note this conference is being recorded. It is now my pleasure to turn the floor over to Colin Murray of Investor Relations. Sir, you may begin.

Thank you, Kat. Good morning, and welcome to today's call. With me today are Matt Lucey, our President and CEO; Karen Davis, our CFO; and several other members of our management team. Copies of today's earnings release and our 10-K filing, including supplemental information, are available on our website. Before getting started, I'd like to direct your attention to the Safe Harbor statements contained in today's press release. Statements in our press release and those made on this call that express 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 describe in our filings with the SEC. Consistent with our prior periods, we will discuss our results today, excluding special items. In today's press release, we describe the special items included in our quarterly results. The cumulative impact of the special items increased fourth quarter results by an after-tax amount of approximately $700,000 or $0.01 per share, primarily relating to a change in the fair value of contingent consideration associated with the Martinez acquisition and a benefit related to a change in the tax receivable agreement liability, offset by a decrease to our gain on the formation of SBR and our share of the SBR lower cost of market inventory adjustment. Also included in today's press release is further guidance information related to our expectations for the first quarter of 2024. For any questions on these items or follow-up questions, please contact Investor Relations after the call. For reconciliations of any non-GAAP measures mentioned on today's call, please refer to the supplemental tables provided in the press release. I'll now turn the call over to Matt Lucey.

Good morning, everyone, and thank you for joining our call. As we closed the book on last year, PBF achieved its second-best financial year in 2023. Over the course of the year, we further enhanced equity value by reducing our debt by over $700 million, and we returned $640 million directly to shareholders through dividends and share buybacks. The company was able to purchase $150 million of our shares in the fourth quarter. I'm pleased to announce our Board of Directors has approved an incremental $750 million share repurchase authorization. This resets our program just over $1 billion of remaining capacity. We ended the year with our balance sheet transformation complete and our strongest financial position ever. As we look at the quarter, the West Coast operations faced clear challenges. Operations outside the West Coast performed reasonably well. Our East Coast and Gulf Coast systems performed well in their respective markets, with capture rates broadly in line with prior quarters. While Toledo operated well, the Mid-Con market was certainly challenging. At times, gasoline cracks were at or near negative numbers. This phenomenon in the Mid-Con during the fourth quarter is not new and is somewhat of a return to normal seasonality. Importantly, we've seen a recovery in the Mid-Con product cracks as February began. Our West Coast system underperformed largely due to our overlapping planned and unplanned maintenance activities. This was an unfortunate convergence of circumstances where we had both assets undergoing maintenance. While this was not the plan, it was the reality. In Q4, we completed a major FCC turnaround at Torrance. As mentioned last quarter, we experienced unplanned flexicoker downtime at Martinez. The FCC was delayed in getting restarted, and the coker work rippled through Martinez operations. The delayed restart of Torrance and the unplanned work at Martinez cost us approximately $100 million in lost profit and an additional $32 million in operating expenses. Looking at our tariff sheets, you'll see that on the West Coast, we consumed less heavy crude as a percentage of input, which increased costs. Our production yielded less high-value products, notably gasoline. As a result of the delays and downtime, we built high-priced crude inventory, which will be consumed in the first quarter. Again, while Q4 was clearly disappointing in California, I believe our West Coast system will be significant contributors to our results in 2024, as it has demonstrated over the last few years. Looking ahead to Q1 across the system, we have a Hydrocracker turnaround in Toledo beginning this month, and an FCC turnaround on the East Coast beginning in March. With industry maintenance across the refining space increasing, we have seen significant improvements in our market cracks in February. Indeed, the outlook for 2024 is constructive, and we are focused on positioning our assets to perform to their potential. Global refining capacity, including new additions and refined product demand, remains tightly balanced. The refining industry has not been able to sustain product inventory builds, and balances remain tight compared to historical levels with growing demand. Disruptions in historic trade flows and patterns are creating tension in the market that is benefiting U.S. refiners, specifically coastal U.S. refiners such as PBF. With this favorable market backdrop, PBF should continue delivering strong earnings and free cash flow while generating long-term value for our shareholders. On the regulatory front, we are pleased to report that we have reached an agreement with the Bay Area Air Quality Management District regarding Regulation 6-5, achieving the mutual goal of lowering particulate emissions. We were able to reach a settlement where we will comply with Rule 6-5 without any mandated incremental investment when the rule goes into effect in July of 2026. Additionally, we do not expect any material changes to our operations or product yield as a result of the regulation. As we've seen from activity earlier in the quarter, combined markets will continue to be volatile. The global refining system, and PBF in particular, will be nimble in adapting to market conditions. The focus will be, as always, on maintaining consistent operations, coupled with disciplined, rigorous capital allocation. Before turning the call over to Karen, I want to take a moment to publicly thank all of PBF's employees for operating safely. Last year, PBF recorded its best year in our history from a personal safety perspective. This is across all segments of our business, including our employees and the contractors who work in our facilities daily. The achievement of the lowest lost time incident rate in our history is a testament to the focus of each and every person in the company in executing their daily routines with the utmost professionalism and care. With that, I'll turn it over to Karen.

Thank you, Matt. For the fourth quarter, we reported an adjusted net loss of $0.41 per share and adjusted EBITDA of $117.2 million. For the full-year 2023, PBF reported adjusted net income of $11.32 per share and adjusted EBITDA of more than $2.6 billion. Cash flow from operations for the quarter was just under $306 million, including a working capital benefit of $59 million. Consolidated CapEx for the fourth quarter was approximately $233 million, which includes $221 million for refining, corporate, and logistics, and approximately $12 million in final payments related to SBR construction costs. For the full year 2023, consolidated CapEx was approximately $1.2 billion, which includes approximately $312 million to complete the SBR facility. On a go-forward basis, capital expenditures for SBR will not be reflected in PBF's consolidated numbers. We continue to demonstrate our commitment to shareholder returns through our quarterly dividend and share repurchase program. In 2023, we paid over $105 million in dividends and repurchased approximately $533 million of PBF shares. Dividends paid in the fourth quarter totaled more than $30 million, reflecting the 25% increase in the quarterly dividend rate announced last quarter. In the fourth quarter, we repurchased $150 million of PBF stock, more than 3.3 million shares. Since the program was introduced in December of 2022 through yesterday, or in just over a little over a year's time, we have completed approximately $740 million in total share repurchases, representing more than 17.6 million shares. We have reduced our total share count to just under 120 million shares. During our third quarter call, we commented that our work to fortify our balance sheet was largely complete. Over the past three years, we have reduced debt by over $3.4 billion, which in turn reduced our annual interest expense by over $200 million. In addition, we eliminated the overhang of our environmental credit payables by reducing the liability by $900 million and we retired our Inventory Intermediation Agreement at a cost of $268 million. These efforts, which totaled nearly $4.8 billion, have enhanced our equity value and produced a balance sheet with investment-grade level credit metrics. One comment on our outstanding environmental payables. At year-end, our RINs liability was fully committed. With the reduction achieved in 2023, we have brought down the balance to near what we would consider the upper range of normal. As a reminder, the current balance represents PBF's commitment across a number of environmental credit programs, not just RINs. Now that we are in the business of generating credits through SBR, we are going to actively manage our consolidated positions to take advantage of market pricing and structure while reducing our overall costs. Individual components may shift based on our commercial strategy, but we expect that maintaining this balance in the $200 million to $400 million range is appropriate over the long term. Over the course of 2024, you can expect the $430 million that was outstanding at year-end to be reduced to this range over the coming quarters. The balance may fluctuate depending on market conditions and commercial strategy. We ended the quarter with almost $1.8 billion in cash and approximately $1.3 billion of debt. Also of note, the final payment of the Martinez earn-out, which we expect to pay in April, now stands at approximately $21 million, down from last quarter's estimate of nearly $95 million. Sustainable dividends and share repurchases are important components of our overall long-term capital allocation and shareholder return objectives. Maintaining our firm financial footing and strong balance sheet remain priorities. To the extent our operations continue to generate cash beyond the needs of the business and the requirement to continuously invest in our assets, a greater percentage of that cash should be available for shareholder returns. As always, we will look at all opportunities to allocate capital through the lens that directs cash to the option that generates the greatest long-term value for our shareholders. Operator, we've completed our opening remarks and we'd be pleased to take any questions.

Your first question comes from Roger Read with Wells Fargo. Please proceed.

Hey, thank you and good morning. I guess, Matt, you kind of hit on it in some of your opening comments, with the IEA out today with a bucket of cold water over the oil and gas industry. But I was just curious how you see demand as you look across your nationwide approach? Obviously, we've had some pretty rainy weather in California. We've had the snowstorms on the East Coast. But looking through those items, how do things look on the demand side?

I think they look reasonable. Obviously, you touched on it in regards to the seasonality and weather; when it’s really wet in California, people generally don’t go out. If it’s really cold in the Gulf Coast, people are not as inclined to drive. Indeed, we just had some weather here in the Northeast that certainly impacts it. But that's seasonal. I think going into the remainder of the year, I’m fairly pleased—we were much more cautious on the soft landing going back over the last couple of years. Overall, GDP and the economy look pretty constructive.

Okay. And then, as a follow-up on the share, let's call it cash returns to shareholders, whichever method it takes, there was a comment made about having an IG quality balance sheet. Is there anything you're doing differently until you would receive an IG rating, or do you have what you have, and we should look at it as that'll be a nice feather in your cap or something like that, but doesn't really alter the way you think about things, or it will help you down the road and the way we should think about total returns for the company?

I'll make a couple of comments and then ask Karen to comment. In terms of doing anything differently, I don’t think so. We will maintain the balance sheet we have today because it's the right thing to do, and there are a number of benefits, some of which we've already seen in terms of trade credit. We have market participants that can see through the rating agencies. I began my career in banking, and the credit agencies are going to be slower; that’s just a reality. That’s not news to us. We have good relationships with each of them. I think we're going to continue to demonstrate that we indeed have a market-leading balance sheet on any credit metric someone wants to look at. So, we're operating our business as if the credit rating agencies didn’t exist. We do want recognition for what the reality is, but that will take some time. Karen, I don’t know if you had any other comments.

Just to add that our goal of achieving an investment-grade rating is based not only on the obvious benefits of reducing our weighted average cost of capital and certain other expenses, but we also believe it might give us access to a greater or broader base of shareholders, those that look for investment-grade ratings, as it confirms that the underlying fundamentals are strong, and that will be appealing, we think, to long-term investors.

I would agree with that. Great. I’ll turn it back. Thanks.

Your next question comes from John Royall from JP Morgan. Please proceed.

Good morning. Thanks for taking my question. So, my first question is just a clarification, I think, on the RIN liability. I appreciate that it's very much dwindling at this point. But I think Karen mentioned the $200 million to $400 million target range. Is that apples to apples with the $50 million to $100 million you gave on the last call? And if so, could you just bridge us from one range to the next? I feel like I may be missing something there, but if you could just help us with that change in the number? Thanks.

Last year or last quarter in the guidance we gave, we talked in terms of the number of RINs that we thought would be represented in that liability. I think now we're viewing the environmental credits liability more holistically and including things like cap and trade and other programs. So, our range now is expressed in terms of dollars and is inclusive of all of our credit programs.

Okay. That's helpful. Thank you. And then, just on SBR, on an adjusted basis, I think you lost about $20 million if we did those adjustments correctly. And, that's coming off a nicely positive result in 3Q. I know you had a catalyst change, but anything else to call out there? And how should we think about the first quarter for RD?

Nothing has changed. A couple of positive developments have come down the path. As we've gotten into Q1, we expect that for all of Q1, we will get our actual low carbon score regarding our feedstocks; we expect that will come in Q1 and be applied for the whole quarter. So, that's a positive development. We also expect to be able to spec into Europe in Q1. That requires approved feedstocks. So, that's not only a regulatory checkbox, but it also requires that you have approved feedstocks going into that. That will take a little bit longer to get into our system where we'll be able to arb into Europe completely, but both of those are very positive developments looking forward. Looking back, obviously, the catalyst change was impactful in Q4, as we talked about on our last call, and there was noise around some LCM charges and other things in the financials.

Thank you.

Your next question comes from Doug Leggate from Bank of America. Please proceed.

Hey, good morning, everybody. Thanks for taking my questions. Karen, these are probably both for you. Let me start with working capital. Even if we took the turn of the J. Aron buyout earlier this year, you still had a net fairly sizable net working capital impact for the whole year that was negative. Was that related to Matt's comment about crude inventory building or is there something going on there that we should expect to reverse?

No, Doug. I think the main impact there is the $900 million that we spent to reduce the environmental credit liabilities. That’s all included in there and is quite outsized and one-time. So, I think you'll see that have less of an impact in working capital going forward.

Great stuff. So, it shouldn't reverse, but it shouldn't repeat either. Fair?

Correct. Yeah. That's the right way to think about it.

Okay. All right. Thank you. Matt, the East Coast cuts a bit in the weeds, I guess, but the East Coast is where we saw your accounting miss this quarter relative to your normal kind of capture rate, if you like, or at least how we think about your LP on that side of the business. What we're trying to figure out if this is something to do with freight costs, crude or maybe the pool as Dangote gets started. Is there anything going on that you can point to that says why the East Coast, with better throughput, why it did a little bit worse perhaps than you might have thought?

No, not in regards to refinery startups. Paul, would you make any comments on the East Coast?

No, I mean, I didn’t see anything out of the ordinary on the East Coast, to be honest with you guys.

What we had over the quarter is crude differentials began to widen. That takes time to filter into the plant. So, you see the market indicators on the cost of crude; there's a lag to that, and I expect you'll see the benefit in the first quarter on that side of it. But quite honestly, Doug, the freight realities of navigating around the Cape of Good Hope means more materials are on the water, which obviously increases demands on shipping, and freight rates have gone up as a result. I think the net result of that resides in a higher crack on the East Coast. So, I think it's resilient to our markets, but there’s nothing extraordinary on the East Coast that was negatively impacting us.

That's great color. Thanks very much.

Your next question comes from Ryan Todd with Piper Sandler. Please proceed.

Thanks. Maybe, you mentioned a few things on SBR, but I guess, as you're a little over six, six, seven, eight months into operations there. Can you maybe talk about high level about what you've learned so far? What's gone well? What's been challenging? How often do you expect to perform catalyst changes there, and maybe how your feedstock mix has evolved over the last six to eight months of operation?

I'll make some high-level comments, and I'll ask Jim Fedena, who's in charge of that operation, to make some comments. Directionally, I think it's been an extraordinary experience so far in getting the plant up on time. Yes, you're always going to work out some gremlins coming out. I think we did that better than most. Our relationship with ENI has been off to a terrific start. I was with some of their executives back in December; they're stateside now, and we're working with our team this week. So, the partnership, I think, is going as well as we could expect, and I think our interests are very well aligned, focused on maximizing all of SBR's capabilities. We still view it as absolutely a tier-one asset in the right geographic location, which gives great options on feedstocks and disposing of products, instead of being tied into California; we'll have the wherewithal to go wherever the market is best. And obviously, we get some benefits connected to Chalmette on the operating expense side. Jim, would you give any other particulars in terms of operations?

The only thing I'll add from a catalyst change-out perspective is that on an annual basis, you change out the GuardVet catalyst. About every 24 months or so, you change out the ISOM catalyst in the back end of the unit. Then another macro thing is, we look primarily less in regards to PBF; the market for RD is down as credits have decreased. The supply of RD has reduced RINs, and California credit prices as well have come down. That's not a surprise to us, and we were expecting it. I think that will continue for a bit, and where it's going to put pressure is on the more marginal players. What they ultimately do will certainly impact the market, but we are clearly advantaged over those marginal players. I think the supply side will shuffle out here over '24.

Great. Thank you. That's helpful. And then maybe, just shifting to the West Coast, not on renewal, but on the rest of the refining business, you've seen a big bounce in margins there over the last couple of weeks. Can you talk about what you're seeing in terms of overall supply-demand dynamics and product market dynamics there on the West Coast within your operations? And then just to clarify, I think did you say in your opening comments that you're still going to be working your way through higher-priced crude inventories there in California? Is that going to be a headwind to margin capture in the first quarter?

It will. Look, there's no question that extensive comments around it, Q4 operations report. That inventory that we carry over will carry over into the first quarter, but that will then be behind us. Paul, why don’t you give direct comments in regards to what you see every day on the ground in California?

The big move in California markets really is the seasonal change out from winter gas to summer gas in Los Angeles. So, that's the significant increase you’re seeing on the cracks that you all look at every day. Additionally, jet fuel is just well bid in the LA and San Francisco markets with the arbitrage from Asia pretty much shut down. So, you’re seeing the impacts of a short market moving into the seasonal high demand periods.

Thank you.

Your next question comes from Manav Gupta from UBS. Please proceed.

Hi. Good morning. I wanted to ask about the renewable diesel market a little. I fully appreciate that these are developments that happened a couple of days ago. But I’m hoping you have more information than we do. A few days ago, it looks like New Mexico passed the senate, passing the low carbon fuel standards bills, and this could go into effect in 2026, and it's a very aggressive program. It goes from 0% to 20% in about four or five years. You haven't seen that before. So, I'm trying to understand if this all works out. Given your location, could this be a new market for you besides California? Can you move the product to New Mexico if things work out in this direction?

Yes. One, I think the point of what happened in New Mexico speaks to the investment thesis in RD, and that is, over the course of time, governments are going to price carbon to incentivize the manufacture of renewable diesel, specifically to our ability to competitively deliver product into New Mexico. It's too premature to say that, but I would also say the market is a bathtub, and to the degree New Mexico draws other barrels, it opens up other markets. So, I’m not so focused on our direct ability to impact the New Mexico market in particular, but all these things cascade with each other and it’ll free up demand in other markets. But it’s certainly constructive and consistent with our investment team, as I said.

Perfect. My quick follow-up is, and you kind of mentioned this also in the earlier parts of the call. You saw this big Mid-Con weakness. It looks like it's abating; the cracks are rebounding. Just like you gave an outlook on the West Coast, what are you seeing in the Mid-Con market? Is all this weakness seasonal? Should we expect a strong 2024 overall for the Mid-Con region in terms of cracks? Thank you.

The Mid-Con economics in the fourth were seasonal. It’s something we normally see on an annualized basis. As we move into the first quarter, Whiting falling over was beneficial to the cracks, and you’re seeing that. So, that’s been the catalyst to move the cracks forward. There have been some crude advantages out of Canada for PADD 2; those are going to come to an end as we get into Q2 and Q3, but I think we’re expecting normalized cracks in PADD 2 going forward.

Thank you.

Your next question comes from Neil Mehta from Goldman Sachs. Please proceed.

Yes. Good morning, team. The first question is just how you're thinking about capital allocation in the context of M&A and what do you think the market is I mean, it's been a big part of the PBF story and how you've gotten to where you are today? Do you still think there are opportunities out there? And what's the overall framework for thinking about it?

Well, I think M&A, as I mentioned in the comments, is a disciplined and rigorous capital allocation effort. M&A is no different than internal projects or share buybacks. We'll evaluate everything in the market as we always have and judge them against each other to allocate capital as best we can. I don't think it's worth speculating on M&A activity at the moment; there's nothing of immediate action. We don’t comment on it in the base case anyway. But it's consistent with what we've been talking about. Throughout 2023, the full-year 2023, we were focused on transforming our balance sheet, and we've done that. It's complete, and now we're a company, as any should be, focused on generating cash. As we generate cash, we’ll look at how we can allocate it—whether it’s external opportunities, internal opportunities, or simply returning cash to shareholders. We've got a dedicated team analyzing all alternatives as we go forward.

No, that's helpful, Matt. And just a follow-up, I'd love your perspective on how you're seeing refining balances, particularly in the context of global refining, which was alluded to earlier. We’ve had two to three extraordinary years of margin. Do you see margins mean reverting or do you believe that this is a new structural normal?

It's interesting. As of yesterday, if you look at calendar '24, more cracks in the market actually look very comparable to '23. I think there's been discussions of reverting to the mean, and I'm not so sure that we're going to revert to the mean as quickly as some are predicting. There's a very big difference from where we were in '22 and even '23 compared to the historical mean. The market is set up very constructively, as I said. The last couple of years, a big thing has been the industry has been unable to build inventory and has really struggled in that regard. Here we sit in 2023, and inventories are very tight. Yes, there's going to be capacity coming on, but quite frankly, it's needed as demand growth for products worldwide will continue to increase. I would personally take the over on that equipment coming on time or as expected. These are incredibly complex, large additions in their own right, both in Mexico and Nigeria, and in my experience, I think that probably takes longer. Tom O'Connor, would you make any other comments?

Yes. Neil, I mean, I think in terms of what Matt was saying, one thing I would add, there’s been a big change in rate-adjusted cracks year-over-year. Board cracks are lower, but we've got a RIN basket that is $4 to $5 lower if we start looking at year-over-year. So, in terms of product realizations, that's meaningful. As Matt was talking about with the refinery additions coming on stream this year, probably part of it lends itself into being next year; a lot of that is coming in the form of the CDUs starting up, and the secondary units are much further out, right. The FCCs and the cokers will take longer to come on stream, which could be quite helpful for the market. The market is tight in terms of secondary feeds on feedstocks for the FCCs and for the cokers.

Thanks, Tom. Thanks, Matt.

Your next question comes from Paul Cheng from Scotiabank. Please proceed.

Thank you. Good morning. Matt, if I look at on a—I mean, since the pandemic, the market condition has been up and down, so a lot of volatility. It's difficult for us from the outside to look at what is the sustaining CapEx, and also including turnaround for the company now. And since 2019, it looks like the unit costs have gone up in the niche of the region, maybe about 20% or so. Is this the new baseline that we should use? Or do you think that's an initiative that the company will be able to bring down over the next couple of years? That's the first question. Secondly, if we look at operationally, Toledo has been struggling for a number of years. What's the plan in terms of improving the operating performance over there? And also, outside Toledo, is there any other refinery in your system that you think could do better and may have work to be done?

Look, it's our job to continually improve. It's our job to offset inflation with efficiencies. In regards to Toledo, in particular, if you go back to the first part of 2023, they had some operational issues, much of it due to the weather and some storms from last year. Operationally, Toledo has run pretty reasonably and consistently for quarters two through four. Regarding OpEx, the single biggest factor that will drive OpEx will be running reliably and increasing throughput. California didn’t do that last quarter, and you’ll see that; putting aside incremental expenses due to some of the downtime, your OpEx will go up on a per-barrel basis when you don’t operate efficiently. I’m encouraged, though—it’s out of our control—but we're heading into 2024 with natural gas prices that are certainly better than they have been over the last couple of years, so that should be a tailwind. Regarding capital, we've given our guidance earlier this year. That guidance included about $50 million of discretionary projects, return projects at each of the refineries. That’s the full extent of our—we don’t currently have any other big projects.

I think it's probably in that $750 million to $800 million range. And again, remembering that looking back at history, we used to talk about a normalized range of $600 million to $650 million, but that was pre-Martinez.

Right. Thank you.

Our final question comes from Jason Gabelman from TD Cowen. Please proceed.

Yes. Hey, thanks for taking my questions. First, I wanted to ask, one of your peers discussed a large project on the West Coast related to compliance with rule 1109.1 in the South Coast Air Quality Management District in Southern California. I'm wondering, is that something that you have to spend money on to comply with? Or are you already in compliance with that?

I wouldn’t project any capital above the numbers that Karen just shared. We’re always spending some money to comply with rules, but there’s nothing extraordinary for PBF.

Okay. So, I mean, whatever you're spending this year addresses that NOx emissions that you need to comply with in Southern California?

Yes.

Okay. And then my second one is just, there was, it looked like there was a proposal in California to require refiners to stockpile gasoline in order to address some of the market volatility. I believe the commission out there was having a hearing on that either yesterday or today. I'm wondering if you have any comments around that. And then more broadly, any other liabilities we should be thinking about in terms of cash calls beyond the environmental liabilities that you mentioned?

Just in regards to California, I think it's way too early to speculate. The paper was written which was essentially a concept that I don’t think is particularly thought through at this point. I don't think there's any regulatory agency that can dictate or make demands on a private company about how much inventory it holds. The concept isn't well flushed out, and I think the regulators and the state government of California can evaluate any number of things. They obviously have to operate within the laws. I don't think there's a supply and demand problem in California as supply has gone down, so the market is tight. The steps they’ve taken so far seemingly haven’t improved that. The concept put to the California Energy Commission hasn't been well flushed out, and it's probably not worth speculating at this point.

Got it. And then more broadly, yes. Thanks.

I joked earlier, and I think O'Malley even used the term from Q4, which was the reduced payout to Shell. Where we were expecting that to be a much larger number, we declined to $20 million, so that's a net reduction on a capital call. But I don’t see anything else major out of the ordinary.

All right, great. Thanks.

We have reached the end of the question-and-answer session. I will now turn the call over to Matt Lucey for closing remarks.

Thank you, everyone, for participating in today's call. We look forward to speaking to you again next quarter and look forward to a prosperous '24. Have a great day.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.