May 16, 2023
On May 12, The Capitol Forum’s Teddy Downey and Daniel Sherwood held a conference call to discuss the most pertinent issues impacting energy markets and policy. The full transcript, which has been modified slightly for accuracy, can be found below.
TEDDY DOWNEY: Thanks to everyone for joining us today on our weekly Energy Conference Call. I’m joined, as always, by Daniel Sherwood, who leads our energy reporting and our Upstream Team at The Capitol Forum. Daniel, good to see you on this beautiful Friday. Sorry, I’ve got a little bit of a frog in my throat.
DANIEL SHERWOOD: You’re not alone. We were just talking about how many people are getting sick right now. And thanks for having me. And we’re going to have fun today. All three of these are going to be good—I’m genuinely excited.
TEDDY DOWNEY: And before we get into it, if you have a question for us, please email firstname.lastname@example.org and we’ll get to your question. You can also use the app. Although, I notice people have not been using that so much. So if you want to ask your question anonymously just email email@example.com. And Daniel, let’s jump right in here on my favorite topic, the Mountain Valley Pipeline and efforts to pass legislation through Congress that would expedite that process. What’s the latest on Mountain Valley Pipeline?
DANIEL SHERWOOD: Yeah, so we’re going to get into the weeds on the different legislative texts floating around this notion of MVP potentially getting involved in the debt ceiling discussions. But before we do that, let’s start with the operator. I think that’s a good place to start. I was pretty surprised by the number of questions I got after Equitrans released its update. The company seems to have really convinced a number of people that it was possible that they could complete construction this year.
Equitrans did temper their language, to be clear. They said, “there are significant risks and uncertainties.” So I want to caveat my analysis with the fact that they were upfront at least about that. But then despite that, Equitrans said that there’s a “narrow window” in which they can still accomplish construction in this year. And I think that that’s practically impossible. And the reason why we always talk about legislative efforts, just for reminder’s sake, is because that’s their only chance in our minds. That’s our own subjective opinion. And we’ll talk about why I think it doesn’t look great from my perspective, from a legislative lens as well.
But from the operational perspective, where Equitrans really kind of focused its optimism is this Fourth Circuit decision that we discussed a few weeks back that sent the stream crossing permit back to the West Virginia Department of Environmental Protection. As we’ve discussed, that’s not the first time this has happened. This Fourth Circuit is the ire of the proponents of Mountain Valley Pipeline, and they’ve, yet again, stuck in the craw of this pipe. Equitrans management was like, hey, look, you know, we feel – I’ll just read this – “since the ruling, we’ve been in close contact with WVDEP and have a high degree of confidence that the issues raised in the ruling will be adequately addressed,” they say. And that was something that people gripped on to. And my response to that is there’s never been a problem getting the West Virginia Department of Environmental Protection onboard here, as has been demonstrated by the litigation history. Where there’s struggle is the pending permits and other agencies or passing the Fourth Circuit’s review of whether the WVDEP is engaging in this permit process in an appropriate way, consistent with federal statutes.
TEDDY DOWNEY: Can we stay on this for a second? So is the West Virginia DEP, are they inept? It just sounds like the court just comes back to them and says, hey, you keep doing this and the review of this issue is inadequate. How can that happen so frequently? It just seems like they could just spend more time, get it right and then it won’t have the same effects in court. Like, why does that keep happening?
DANIEL SHERWOOD: I think in defense of the West Virginia Department of Environmental Protection, there are some moving targets here. I mean, let’s say just even from an administrative perspective, there was a period of time in which this pipeline was under construction, where some of these federal statutes that are kind of coming back to bite the WVDEP were getting gutted or the federal administration at the time was attempting to gut them. So that’s kind of on a less legal perspective and more on like a macro political sentiment perspective.
At the end of the day, what keeps their review from being robust enough to pass the Fourth Circuit, what the Fourth Circuit showed with the Virginia case is they are willing—it’s not like a de facto, hey, states can’t do stream crossings. So what I would imagine will help the West Virginia Department of Environmental Protection in this run more than they had in the last run is the ability to replicate pretty much everything that passed the Fourth Circuit review in Virginia’s case.
This is again why I’m skeptical of this timeline from Equitrans because that’s going to be time consuming. Even though the agency has undergone this permitting process before, clearly there’s certain information that haven’t been considered.
And so this gets back to, Teddy, kind of one of our favorite themes about this pipe is that an aspect of what makes it unique is it’s passing through topography that’s stereotypically not passed through as common as, say, the plain states, for instance. And so, like, they’re dealing with technological issues of how do you get the equipment to these stream crossings? How do you prevent erosion?
And then while that’s happening, one of another favorite things that we like to cover is newly listed endangered species and changes to what can be developed and when. And so there are a lot of moving parts in our dynamic world. And so I think it’s less ineptitude and more “we want to get this done. We think this looks great. This would pass our muster.” And then the Fourth Circuit seems to be really holding aspects of NEPA, for instance, in a light that many legal observers would argue it should always be held to and others would argue this is ridiculous. We need to address this and Congress needs to gut NEPA.
TEDDY DOWNEY: Yeah, I think that’s a good transition. I’d just like the frame of, look, they now have a path laid out by that Virginia case, and that’s just going to take time. So it’s not that they can’t get it done, but this accelerated timeframe just doesn’t seem too realistic. So with that mention of Congress, I think that’s always where I like to get an update from you in terms of where the optimism for pipeline permitting reform comes from. So what’s the latest happening now in Congress around the Mountain Valley Pipeline?
DANIEL SHERWOOD: Yeah, and I had fun kind of brushing up my research on this one and just imagining, you know, it almost feels like a playwright’s dream with the drama of Podesta, Biden and Manchin and then Capito and McCarthy and with the trades and the NGOs. It makes for a dynamic story from a political perspective.
So in the in the weeks where we paused our discussion on this, there’s been some developments, with the hottest topic right now being whether permitting reform will be included in this debt ceiling move? And there’s debate on that. Capito, for instance, is like, “Oh, definitely. And specifically, our Mountain Valley language is in.” That’s what you’d expect her to say. If you look at the text of the House bill that McCarthy put forward, it’s better than the text that was getting introduced at the end of year last year by Republicans, and the beginning of this year.
But again, doesn’t explicitly say—I pulled some quotes for this. But it doesn’t explicitly call out Mountain Valley Pipeline. It does talk about NEPA. It does talk about certain aspects that would help pipeline construction. But in order to finish in 2023, as we’ve talked about, what’s that golden egg? It’s a venue choice. Or disallowing legal challenges. And they basically have to say Mountain Valley Pipeline can be completed tomorrow and nobody can stop it, in my mind. And we’re very far from that.
Still in the House text, it’s focused on international border crossings not needing a presidential approval, getting Keystone XL back online, pipeline security. You know, other energy issues are definitely present. It’s a 250 page text, the one released in April.
So then after the House released its text, to fill that gap and to probably address persons like us who are like, “Hey, look, they’re still not even talking Mountain Valley Pipeline,” on the Senate side, Manchin reintroduced his text and this is kind of where it gets fun.
Through Podesta, we’ve come to understand that repeatedly Joe Biden is going to support Manchin’s language. And I love – I’ve got to read this one. Just give me five seconds while I find it. Yeah, he said last week. So, Podesta has been talking about this at a couple of events. Last week, he said, “We are willing to take on some of our friends” specifically in relation to natural gas pipelines, Mountain Valley Pipeline and Manchin’s bill. And the whole reasoning behind this for the Democrats and the Biden administration—is like, “Hey, look. We made an agreement with Manchin and that’s how we got IRA across the finish line. And then Manchin never got his pipeline.” And so they’re trying to say, “We’re trying to be good to our word because that’s what a compromise is.”
So you have that on one side. But on the other, you also have this week the Biden administration issuing their energy priorities. And again, there’s nothing in there about Mountain Valley Pipeline, much less say, you know, natural gas assets in Biden’s priorities for building America’s energy infrastructure. And you read through each one of these priorities and you don’t see anything about natural gas. You don’t see anything in there about Mountain Valley Pipeline. The best pipeline reference, you see only one, is about carbon capture. And you’ve had progressives say that there’s no way they’re going to interact with anything if it’s got natural gas pipeline assets associated with it.
So it’s like, what a stalemate, you know. And it really is very much—the way I’m reading all of that is that the Biden administration is being savvy and saying publicly, “Look, we would love to work with Manchin” just to keep him at bay and to keep that floating. And I think an aspect of that calculus is they know it’s not popular among the House Republicans. Manchin doesn’t have that type of buy-in from the House. I think that’s one of the reasons why the Republicans are focusing more, it seems, on the oil assets, on security, almost like maybe a political stunt. Like, no, Manchin. We’re going to ignore your natural gas pipeline. You know, that’s what you get for getting IRA across the board. Because what’s central to McCarthy’s whole stance right now? He wants to gut the IRA. So it doesn’t help Manchin’s negotiating ability if Biden’s publicly saying, you know “Hey, yeah, because he got us the IRA, we want to get him Mountain Valley Pipeline.”
TEDDY DOWNEY: I would say, in addition to all this, I mean, a huge amount of the talk about the compromise on the debt ceiling is related to spending caps and is related to spending. This would be an out of left field rider to a certain degree. Not to say that you can’t get those on occasion. But you can’t do so much that you lose some Senate votes, you know what I mean? They’re going to need to—this compromise, I mean, the Democrats are definitely going to take it on the chin at one level on whatever spending cut they agree to, if they get to a deal, right? Because they are being held—they’re the ones that feel obligated to avoid a default, right? And they’re not willing to do a 14th Amendment or some other kind of strategy, mint the coin, for example, to sort of kick the can down the road.
So they’re definitely going to take it on the chin. And so I can see room for optimism. What I don’t really see is this rising to the level of getting attached. Because it’s not really material at all to spending caps or anything like that.
DANIEL SHERWOOD: And it wouldn’t be enough – let’s say it gets attached. My feeling is that if it was, best case scenario, it’s still not going to get Equitrans across the finish line within this year.
TEDDY DOWNEY: Yeah, that is interesting. I mean, that’s what we’ve been saying. Unless they get the sort of total green light where it’s like Mountain Valley Pipeline by name must happen and all permits are waived or whatever, you know, it’s just hard to see.
DANIEL SHERWOOD: You can’t do it, I don’t think.
TEDDY DOWNEY: Yeah, it would just be such an usual, anti-democratic, I don’t know. It seems like a lot. It seems like a lot to ask. So I get where this hope is coming from a little bit. But I think our caution and the way we’ve been thinking about this has been pretty good. And it seems just to make to make a ton of sense to me. So anything else on Mountain Valley Pipeline?
DANIEL SHERWOOD: No, I think that’s good. And just for our listeners, we are very invested in your questions. An aspect of how we pick these topics is follow‑up questions from this call and people reaching out to me throughout the week. So if any of this, you know, we welcome alternative views. So our emails and DMs are open.
TEDDY DOWNEY: Nothing better than a good devil’s advocate I always say. So if anyone disagrees, email us with a question or put it in the platform. So with that, let’s turn to Eos Energy. I know you’ve brought this player up a few times on the call in the past. I would love to get your update on the DOE loan process related to Eos.
DANIEL SHERWOOD: Yeah. So this in our distributed energy resources file, right? So that’s just kind of an annoying energy term for battery and storage and that’s what Eos does. They offer storage solutions. Since the IRA has been passed and even before that, a common theme of things people ask us is which of these energy players exposed to transition technology is going to succeed? Eos has gotten a lot of attention, mostly around this DOE loan. But it’s an interesting story because the loan is kind of pitched now by the bulls as this way to save this company. This company is a going concern, bleeding money and having a hard time lodging its foot in the sector.
And so that’s the sky high view. I’m going to do a real quick explainer about what makes Eos unique. And then we can kind of dive into the specifics of the DOE loan. And then why our view is how that could be a little bit of a false flag, even if they do get the loan, which should surprise no one. The last time we talked about Eos was when we talked about the Qualifying Advanced Energy Project credit.
So Eos differentiates itself by being a zinc-based battery. Most of these batteries that that are being deployed right now are lithium. What are the differences between a zinc and a lithium battery? Zinc is a more abundant resource. So the idea is it’s going to be cheaper to produce. That is accurate in many instances. But as you can tell by Eos’s struggles, despite zinc being cheap, they still haven’t been able to make it economical and scalable yet. I’m not saying that they can’t, but they haven’t yet. Whereas just this morning, a multibillion-dollar merger between lithium manufactures got announced. So, that speaks for itself, I think, about the economies there.
So the other kind of big advantage of zinc is that it’s safer and less hazardous than lithium in many ways. But kind of like how we were discussing about methane last week, an aspect of why lithium is so good at being a battery is what can lead to its safety concerns. So the advantages of a lithium battery is it has usually more discharge and more recharge cycles. So a longer lifespan, which is related to its higher reactivity and thus its higher energy density. So as a battery, it kind of checks most of the boxes of what you’d want to see from a performance perspective.
And why are batteries more important now than before? Because we’re hoping to integrate more solar and more wind into the grid. And as people love to say, when the sun doesn’t shine and the wind doesn’t blow, you’re not going to be generating electrons. And then, of course, in the alternative, there’s moments when the sun is shining a lot and those electrons aren’t all being consumed. So that’s why there is a market need for storage now. So it can deploy those renewably generated electrons in a time of peak demand. Okay, so that’s Eos Energy. Does this remind you at all of Bloom, Teddy?
TEDDY DOWNEY: Yeah, it definitely sounds familiar, especially in terms of like kind of needing this government money to get it to scale or get to where it needs to go. So I’d love to get your take on this DOE loan application.
DANIEL SHERWOOD: Yeah. Generally speaking, we have found that if it’s a niche technology, in this space especially, and so much of its business model relies on government support, it’s not necessarily going to be the best—you know, like while the technology may take off eventually, stereotypically, you can expect that timeline to be extended. And it shouldn’t surprise you that Eos already relies on a number of different types of government incentives separate from this loan. So I think there’s a lot of regulatory uncertainty underneath the business model.
Right now, this loan is for Title XVII from the DOE Loan Program Office. That’s Jigar Shah. He gets a lot of press. It’s like this huge billion dollar—I can’t think of the total figure right now. And they’ve already provided more than $35 billion. That number is slightly dated. So that’s how Eos is pitching it to their investors of its importance.
So I’m going to walk us through the process of this application for the loan so that we can understand where Eos is. This is from PV magazine, the process is as follows: in the part one application, the applicant provides information to the loan officer so they can determine whether the project satisfies part one technical eligibility requirements. If those are satisfied, then the LPO invites the applicant to submit a part two application. Eos has passed that. DOE’s invitation to submit a part two application is not an assurance that DOE will invite an applicant to do the due diligence stage and the term sheet negotiations or that the applicant will receive any funding.
So right now they’re in that second phase and the term sheet negotiations. As our invite says, they’ve just announced on their earnings call that they’re in active discussions about the term negotiations. That can sometimes take years, according to other people who’ve been through this process.
And then what I saw kind of absent from some of the discussions is that after the terms are agreed upon, based on my research, it looks like the approval is conditional. And so there’s going to be yet another list of bullet points that even when, you know, sure, maybe the investors react if they do hit the PR Newswire with, “Terms have been executed.” But even then, the loan isn’t guaranteed.
So that’s where we are—more waiting. I talked to a couple of people familiar with this and they said I wouldn’t hold my breath. And then I think more importantly, and what I’ve been saying to people who I talked to on this issue, is let’s just say—and I alluded to this already—but let’s just say they get this loan right away and let’s say they also get the Qualifying Advanced Energy Project credit. And let’s say they also get this ITC for utility and residential storage component that’s coming out. You know, I mean, there’s a lot of different programs. It’s like, again, even with all of those—and they’re not even talking about some of those. And so what I would expect is that if they have issues getting this loan, all of a sudden they’re going to start talking about another incentive program that can be seen as a really big boost in the future while they still try to figure this out.
So that’s kind of my overall take. I would be surprised if they finish negotiating those term agreements within the next two or three months, which is what I think people were hoping that it would be finalized in April, but I could definitely be wrong. So we’re going to keep on watching this. And I also am going to be kind of especially sensitive to if they start to highlight a different program, which is common, and we see often.
TEDDY DOWNEY: You know, just kind of linking it back to Bloom, I don’t want to say it’s like that, but are there any – with Bloom, there were kind of lot of examples that we found of the technology not living up to the hype. Have we seen that with this company, Eos? Or is it really too early to say that? Or are there any similarities on that end? Because there was just, it seemed like a lot of execution risk with Bloom from an evidence standpoint. And I’m just wondering if we have any of that with Eos or if it’s different.
DANIEL SHERWOOD: Yeah, and I’d love, you know, if you wanted to give our team the green light to do a dive as deep on Eos as we did with Bloom, it would be fantastic. From the surface level generally, looking at Eos, there are similarities.
And just to zoom out for anyone who’s not familiar with Bloom, is like Eos, it differentiates itself based on the kind of core component of what makes it a fuel cell. So most—not most, but there’s a number of different ways you can make a fuel cell. And that’s very much kind of a discussion right now of what’s the best technology. But Bloom is unique because they make theirs with solid oxide.
And so what we found in so many ways, whether it was biogas—and this is when Steve was with us, you know, Steve did some great work on this. And whether it was biogas, whether it was efficiency, which is what you just brought up, Teddy – there were applications where when you would plug in this Bloom technology that it started to present other risks that weren’t foreseen because of the different chemical components of the underlying technology.
And so, again, with zinc here in the case of Eos, there are similarities. For instance, there’s this dendrite issue. That’s with aqueous based zinc batteries. I think a component in the cathodes? Something of that nature. And I know I’m getting into the weeds there but the reason why I brought up the biogas aspect of Bloom is because kind of a lesson I took home from that is that when you have these specialized pieces of technology, there’s a number of technical hurdles when applying them in different use cases or on larger scales.
And so for zinc, for instance, if you have a shorter lifespan, that’s going to, in my opinion, make a government a little bit less likely to support a huge roll out of those at a utility scale, you know? The notion of the rural utility that’s going to be getting some BIL grant money to install batteries will have to replace the whole fleet in 30 years rather than 50 with lithium? You know, those are obviously factors in the equation and fictional numbers. And so, I didn’t mean to meander there at the end, but there are parallels.
TEDDY DOWNEY: Okay, great. Let’s move onto Coterra because you know I love talking about the upper and lower Marcellus, it’s another favorite topic of mine. So we have in here Coterra Marcellus assets underwhelm. Maybe you could just give us an update on Coterra earnings and your take on what that means.
DANIEL SHERWOOD: Right. Thank you. Yeah, and what we’re following up on about Coterra, is we’ve reported on what the short term and longer term risks, how they’ve affected Coterra’s operations following the merger of Cimarex and Cabot.
And at the time of the merger, a number of people came out and said, hey, you know, this deal doesn’t look like it’s going to be perfect for Cimarex. Why are they doing this? And we agreed and we’ve been watching that process as it plays out. And we saw the reserves right down and then we predicted that the natural gas output from their Marcellus assets would be lower. We were correct about that.
And so now we’re continuing to watch as Coterra pitches itself as an oil-exposed company, and it devotes its resources more to exploitation of oil. And while that seems to work for certain market audiences, the fact is if that’s the case, they have 51 percent of their revenues generated from natural gas. So that’s a pretty gassy oil company.
So our take of this most recent earnings update was it was just kind of muddled. It’s hard for us to make any hard conclusions because I feel like management at Coterra was avoiding hard conclusions. Because you can’t really have it both ways. You can’t say we’re sustaining our operations at this at this level area while they are extending the lateral length of their best wells and drilling more of their less high performing wells, and then also saying that they want to focus more on oil drilling elsewhere. You know, it’s just some of those things don’t necessarily all make sense to me.
And they have that CapEx shift and canceling their variable dividend. So they’re preserving cash. They’re keeping Marcellus production flat at 2.1 BCFE a day. Now, this is kind of interesting to me. The production share of their total operations dropped by a percent while their natural gas revenue dropped eight. And you didn’t see that same percentage of production increases in the oil and NGL space. So for me, that indicates that the Marcellus assets are continuing to kind of weigh down the company to a certain degree.
So to bring it all home—and Teddy, we’re going to let people go and you’ll have a little bit of time to clear your head before your next conference call. But this next bit of research is brought to you by our Sharon Kelly. She is with Julia in the trenches, working on our new investigation that hopefully people will be able to read next week. That’s why she’s not joining us.
But as far as that second bullet point and about that, lower Marcellus/upper Marcellus distinction. So this gets back to our whole discussion about tier one versus tier two, which I’ll save you guys the explainer of. But just think of lower Marcellus is lower in the ground. So it’s deeper. And upper Marcellus is higher in the ground. So it’s shallower. Seems obvious but at least for me, I conflate them often.
The lower Marcellus, the deeper assets here is what was kind of the primo location for what was Cabot and now Coterra. And it’s what made them kind of famous as this low cost natural gas producer. What we’ve reported on extensively is those locations and the deeper layer right here have grown less accessible and less cheap. That’s why they’ve been drilling more and more in the upper Marcellus.
And so what we did is—what Sharon did, and this is very preliminary and kind of back of the envelope. This is relatively new data and it continues to come in. But using Upstream, we compared, at the 12 month period of peak production for the new upper Marcellus wells, we compared to those lower ones. And we’re seeing, you know, we already knew that peak production was going to be lower. But in addition to that, we’re seeing that the declines are a little bit more steep. And again, that might change. But if that continues. now you’re drilling less prolific wells with higher decline rates, and that’s obviously not good.
So far, we haven’t seen it show up in total output, which is kind of another reason why it’s interesting to us to see that the lateral length in the lower Marcellus, the deeper basin, has increased. And what that means for oil and gas talk? Usually, the more you drill horizontally, it’s because you have a pretty good well bore. You don’t want to drill an entire new well and you want to extend those laterals. So you can really maximize what you can get out of your best locations. And so if we’re seeing those laterals extend in their best locations and then more holes get drilled and sunk in their not as good locations, that would indicate to me that we might see some more pressure in the short term on production out of the Marcellus.
TEDDY DOWNEY: So kind of some warning signs from Coterra in their Marcellus operations. And again, you know, we’ve said, hey, the tier one or two issues, can be really company specific. Do you feel that way here? Or is there any kind of a theme at all? Or really we’re just saying this about Coterra and we have to use Upstream to see if it happens to the other operators also?
DANIEL SHERWOOD: That’s why we talk about Coterra. And Teddy, you’re right that we talk about this as a company specific thing. What we are most interested in with this file is determining, you know, observers are attempting to determine the degree of awareness that Cimarex had of some of these issues. Because if we can model it with our Upstream data, the notion would be that they can model it with their proprietary data, their own internal data. And so it kind of begs the question, I think ill informed people who like to say that the end is nigh are saying that shale has reached its peak. And as we continue to say, that doesn’t seem to necessarily be the case. And we spoke to this in the context of Permian M&A. We spoke to this in the context of Latin American oil exploration. You know, there are a lot of things moving that are kind of trying to get closer and closer to: are all the best locations drilled or not? And it’s true that some of the best places are drilled right now.
But some people say tier two is going to become tier one, which I would say is just not right. And then that take is everything is getting worse. Whereas, others are saying, no, there’s still great drilling locations out there. We just don’t have them, you know. And they’re being closely held by certain entities. Like in the Marcellus/Utica, it would seem like EQT has a very long runway of high quality drilling locations based on my analysis, you know. Whereas, it doesn’t seem like, as we’ve reported, Coterra’s leaning more and more on those locations that aren’t considered premium. Are there other examples like this, Teddy? Absolutely. But we just don’t have that granular level of data in the Bakken or in the Denver Julesburg or in the Permian yet.
TEDDY DOWNEY: Yeah, I like that teaser. You know, I just think about it from the standpoint of what we talk about on these calls. Because sometimes we’re talking about, well, they clearly could be producing more, but they’re purposefully not. And they’re trying to say, hey, everybody slow down. And then you have these other operators like, oh, I wish this was a little bit easier for us. So just from the storyline that we’re talking about, it seems like it really is operator specific at this point as opposed to thematic.
DANIEL SHERWOOD: You bring up a very good point, though, from a competition perspective – because do you see Coterra buying up a number of small producers in the Marcellus/Utica, for instance? No, you don’t. Whereas, that is what you see EQT doing. And so I think when we talk about some of the more dominant market players, they have discernibly different conduct. If you compare Chesapeake, Southwestern, Antero and EQT, the large volume and growing Marcellus/Utica producers and then both Chesapeake and Southwestern are diversified outside of the region with an entity like Gulfport or an entity like Range or an entity like Coterra, where their operations are slightly smaller. I mean, Coterra is spread out. Gulfport is spread out. But they have this kind of tough issue of like where to devote capital. They can have higher decline than their peers.
And it’s like the latter camp is not going on a buying spree of the high producing private equity backed operators, for instance. And they’re also not talking as much about, you know, the earnings calls, transcripts, in my opinion, have a very different feel to them. They’re not really talking about, you know, bragging about the fact that their production came in lower than what they forecast. They’re talking about, “yeah, you might be able to see a comeback next year.” You know, “see us take off this rig.” And they say, this is the second or third time I’ve seen Coterra management say, “we’re not that good at predicting changes with commodity prices and commodity swings.” And that always strikes me because, I mean, no one can be Delphic on this, but of the people who should be good at this, it would be – that’s kind of your job. It’d be like you saying “I’m not very good at editing stories,” Teddy. So, I think that’s an important distinction to draw.
TEDDY DOWNEY: Yeah, that makes a lot of sense. And I think we don’t have any questions in the pipeline actually. Let me check really quickly. No questions in the pipeline. Daniel, great conversation as always. I think we showed off a lot of range here. Three really different topics. Love getting in my Mountain Valley Pipeline discussion and thanks so much for doing this and thanks to everyone for joining the call today.
DANIEL SHERWOOD: Thank you. Have a good day.
TEDDY DOWNEY: This concludes the call.