Hello. And welcome to the LyondellBasell’s Teleconference. At the request of LyondellBasell, this conference is being recorded for instant replay purposes. Following today’s presentation, we will conduct a question-and-answer session. [Operator Instructions] I'd now like to turn the call -- conference over to Mr. Doug Pike, Vice President, Investor Relations. Sir, you may begin.

Well, thank you. Hello. And welcome to LyondellBasell's First Quarter 2015 Teleconference. And I'm joined today by Bob Patel, our CEO; Karyn Ovelmen, our CFO; and Sergey Vasnetsov, our Senior Vice President of Strategic Planning and Transactions. Before we begin business discussion, I'd like to point out that a slide presentation accompanies today's call and is available on our website www.lyondellbasell.com. I'd also like for you to note that the statements made in this call relating to matters that are not historical facts are forward-looking statements. These forward-looking statements are based upon assumptions of management, which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. And actual results could differ materially from those forward-looking statements. And for more detailed information about the factors that could cause our actual results to differ materially, please refer to the cautionary statements in the presentation slides and our financial reports, which are available at lyondellbasell.com/InvestorRelations. A reconciliation of non-GAAP financial measures to GAAP financial measures, together with any other applicable disclosures, including the earnings release, are currently available on our website lyondellbasell.com. Finally, I'd like to point out that a recording of this call will be available by telephone beginning at 2 p.m. Eastern Time today until 11 p.m. Eastern Time on May 24th by calling (866) 839-4837 in the United States and (203) 369-3588 outside the United States and the pass code for both numbers is 4558. Now during today's call, we'll focus on first quarter results, the current environment and the near-term outlook. But before turning the call over to Bob, I’d like to call your attention to the non-cash lower of cost or market inventory adjustment or LCM that we recognized during quarter. This charge is somewhat unique to our 2010 company formation, when all assets and liabilities were measured at fair value, our use of LIFO accounting and the recent declines in prices for many of our raw materials and finished goods inventories. The comments made on this call will be in regard to our underlying business results, excluding the impact of LCM inventory charges. That being said, I’ll turn the call over to Bob.

Good morning. Thank you for joining our earnings call. As Doug mentioned, a set of presentation slides accompanying this call and is available on our website. Let’s take a look at slide four and review a few financial highlights. First quarter earnings per share were $2.54, but EBITDA of $2.04 billion, excluding a $92 million lower of cost or market inventory adjustment. This quarter the EPS figure is a new high for LyondellBasell and our EBITDA has now averaged approximately $2 billion in each of the last four quarters. This can be seen in the lower left chart. Strong operational and business performance coupled with share repurchases contributed to a quarterly diluted earnings per share increase of $0.82 per share since the first quarter of last year. Over this one year period, our outstanding share count was reduced by 58 million shares or 11%. At the end of March, we had 475 million shares outstanding and as of the 22nd of April approximately 473 shares are outstanding. Overall, our business portfolio has continued to perform well, margins and volumes have been good leading to consistent strong results. Our revenues have declined since product prices have followed crude oil price declines. Ultimately, in our business, profitability and cash generation are more important metrics and both have been strong. The sustained strength of LyondellBasell’s profitability over the past year in this volatile crude oil environment can be attributed to a combination of items which have helped offset the impact of lower product prices related to the decline in crude oil. First, tightness in the global ethylene and polyethylene supply and demand balances help support product prices. This has been driven in part by planned and unplanned industry downtime, which is persistent into the early weeks of April. Coupled with our solid operations,…

Thanks, Bob. Slide seven and eight provide picture of our cash generation and use. During the first quarter, we generated $1.5 billion from our operations and issued $1 billion in 40-year bonds at an interest rate of 4.625%. Our cash and short-term securities balance improved as a result ending the quarter with $3.6 billion or about $600 million more cash and securities than at the end of 2014. Cash used for share repurchases and dividends totaled $1.7 billion during the quarter. During the first quarter we make several annual payments, including Taxes property taxes, customer volume rebates and employee bonuses. Together, these payments totaled approximately $465 million. During the past 12 months, we have generated $6.7 billion in cash from operations, while raising $1 billion from bond issuances and issuing over $4 million in commercial paper. Almost $7.4 billion were used for share repurchases and dividends and another $1.5 billion invested in capital expenditures. Before I wrap up, I want to point a couple of other items that might help your analysis. First, our book tax rate was 27% in line with our previous guidance. Depreciation and amortization was $287 million. However, this includes a non-recurring $35 million impact from amortization of an environmental credit. Thus, the first quarter run rate is below previous guidance. Assuming the euro dollar relationship remains near first quarter levels, we would expect depreciation and amortization to remain near the adjusted first quarter run rate. The final point, I want to discuss is our overall foreign exchange exposure. We have defined some of the pertinent points on slide nine. There are lot of moving parts in our global business but in the end, we believe that the real economic and business exposure to foreign exchange is small relative to the size of our business. Our businesses tend to be global in nature and priced off of crude oil based raw materials. Therefore our products are generally priced in relation to dollars. Of course, we do experience translation impacts in our reported numbers. This quarter the reported translation impact is $45 million as compared with the fourth quarter exchange rate. However, we believe that this was mostly offset within the business and the true economic impact was not significant within our earnings. Along with the nature of the business serving as a foreign exchange buffer, we also hedged our net transaction exposure. When all aspects are considered, we don’t believe that exchange rate had a significant impact on first quarter results. With that, I’ll turn the call back to Bob.

Thanks Karyn. Let’s move to a deeper discussion of the underlying segment results, excluding the impact of the LCM inventory charge. Slides 10 and 11 pertain to Olefins & Polyolefins - Americas. First quarter EBITDA was $1.07 billion, about $200 million less than the fourth quarter. Olefins results declined by $280 million as ethylene prices declined by $0.14 per pound from Q4 to Q1. This was partially offset by lower cost of ethylene production, which modestly declined due to lower feedstock and natural gas cost. Our U.S. olefins plant ran at approximately 97% operating rate during the quarter, approximately 10% ahead of the U.S. industry average. Our metathesis unit ran throughout the quarter generating approximately $20 million of EBITDA. Approximately 90% of our ethylene was produced from NGLs with ethane representing approximately 70% of ethylene production. On slide 11, we have plotted the key NGL prices and the costs of ethylene production metrics as estimated by IHS. These provide good perspective on the NGL price response to the decline in the price of crude oil as well as the impact to the cost of ethylene production. You can see that U.S. propane and butane prices largely followed the price of crude oil lower. Similarly ethane prices followed natural gas prices. These movements accompanied by co-product price movements result in IHS' estimated cost of ethylene production metrics, plotted on the right hand side of the slide versus the first quarter of last year, IHS' estimates that the price of ethylene declined by nearly $0.14 per pound while the cost of ethylene production metric declined by nearly $0.10 per pound. Our margin results show a similar trend while volumes are benefiting from our expansions in the absence of last year’s significant turnaround activity. While the olefins results declined sequentially, polyolefin results improved…

Thank you. [Operator Instructions] And our first question comes from Arun Viswanathan with RBC Capital Markets. You may ask your question.

Thanks for taking my question. Congratulations on a great quarter. Just wanted to understand some of your comments. You've pointed out some outages that are supporting pricing right now and you said that conditions are relatively consistent. Can you comment on the demand trends that you're seeing in April and maybe your expectations for May and June? Do you expect restocking or increased consumer demand, especially in Europe as well just given a weak euro? Thanks.

Market conditions are very strong, as I mentioned in the previous earnings call. Generally, we see seasonal improvement in our demand going in Q2. So if you look back in time, Q2 tends to be one of our stronger quarters in terms of demand. As we sit here today, supply-demand balances are well balanced and any small outages have caused tightness or even shortage in regional market. So my sense is that volumes will remain strong in U.S. and Europe in April, May and June. Small outages or regional outages can cause local disruptions. We are at that point on the operating rate curve where markets are -- supply and demand are well balanced.

Okay. Thanks. And as a follow-up in I&D as well, you stated in the press release that there are some seasonal benefits. Maybe you can just help us parse that out with some of the downtime. Do you expect Q2 results to be up? And then how does the rest of the year play out? Thanks.

Generally, Arun in I&D, the seasonality comes from oxyfuels where we benefit from butane is becoming relatively less expensive in the summer months and the blend season kicks in. So, I expect that oxyfuel results should improve as they do each year seasonally in Q2. For the rest of the year, we expect very good demand for all of our products in the I&D business.

Great. Thanks.

Thanks. Our next question comes from PJ Juvekar with Citi. You may ask your question.

Yes. Good morning, Bob.

Good morning.

European and Asian ethylene seems to be quite tight. And I think there are a couple of things going on. I think 10% to 12% of Asian capacity is out for maintenance. And then secondly, oil prices have gone up. So that might cause some restocking. So how do you think about this tightness and how do you think that plays out for rest of the year?

In the case of Asia, supply and demand balances are tight. And then as you rightly note, there were lot of outages in Q1. From what we see in the IHS information, the planned outages are actually going to be higher in Q2 compared to Q1. So, I would expect that in a rising oil environment, the restocking plus seasonal demand increase should be positive for products sales into Asia. And I think that should tighten the global supply demand balance, especially for polyethylene.

Thank you. And then secondly, just on a longer-term issue, oil and gas CapEx has come down quite a bit. The rig count has fallen and it seems like the labor pressure on the Gulf Coast is easing a little bit. Would you like to take advantage of that with any further brown field or green field projects, or is that too early to make a call? Thank you.

Thanks, P.J. Well, I think it’s a little early to make that call, because we really haven’t seen the labor rate stabilize yet. Perhaps it’s safe to say that the rate of increase in labor rates has not been as much as what we’ve experienced. We will continue to evaluate that, but as you know, we have a lot of projects still in front of us that we need to execute in terms of the bottlenecks. We remain focused on those as those are low costs, high return and they will be well ahead of the first class routes capacity that will come out. So we will evaluate as we continue to evolve our strategy, but at this point, we remain committed and focused on executing what we have in front of us and then we will see how labor markets evolve.

Thank you.

Thank you. Your next question comes from David Begleiter with Deutsche Bank. You may ask your question.

Good morning. Bob, can you discuss your view of U.S. ethane now $0.18 a gallon near all-time lows. How do you see that price trending this year and how you do ethane supply demand going forward over the next three or four years, given perhaps maybe a little lower growing activity and increased demand from new crackers and export facilities?

Well, in terms of supply demand balance, we see still an abundance of ethane. They are somewhere 300,000 and 400,000 barrels per day of ethane being rejected today. So that’s a significant amount and could supply several world scale crackers that will be built in the U.S. In terms of the near-term price dynamics, it seems to me that the ethane has been trading right around its field value and with propane being abundant, propane will be competing to be in the cracker feed slate here in the U.S. So between both of those being well supplied, my sense is that ethane will be closer to its fuel value in the foreseeable future. And with natural gas prices at $2.50 coming in the December months, I expect that ethane prices should be where they are today.

Very good. And Bob, just make -- I am sure you will address this Wednesday, but how do you view acquisitions and what role they might play in Lyondell’s future over the next five to seven years?

Our focus David has been on share repurchase as a means of deploying our free cash flow. That’s really the benchmark that we compare acquisitions to. We will continue to develop our strategy with our Board and we will look at different alternatives, but frankly we have to think about why -- what are we trying to sell for. It is an acquisition for the sake of growth or to become bigger not necessary as we are already a very large company with the global footprint. We have incredible scale and we will show you that next week at Investor Day. So we are in a great spot. We don’t have to do something in terms of an acquisition today. We will evaluate different options of our strategy with our Board and in the meantime continue to focus on delivering on our CapEx that we in front of us and continue our share repurchase program as we have outlined.

Thank you very much.

Thanks. Your next question comes from Hassan Ahmed with Alembic Global. You may ask your question.

Good morning, Bob.

Good morning.

You broadly spoke about demand obviously being good and you mentioned restocking generally. My question is a bit more specific about the polypropylene side of things. If I take a look at sequential volume improvements, a good 6% in O&P Americas, up 16% within EAI. Is this sort of sustainable? Is this primarily restocking related? I mean, if you could talk a bit about the polypropylene market in general.

Yes. I think in polypropylene in both regions, demand is growing at a reasonable rate. There is some restocking that probably occurred in Q1 and some destocking on our side. So if you think about an inventory in the value chain, I am not sure that has increased significantly. It’s probably shifted a little more downstream. Having said that, I don’t think inventory downstream is on the high side, it’s probably about right going into a seasonal uptick in Q2. So could we experience 16% growth quarter-after-quarter probably not. There are some timing effects here. But I do see demand being very strong globally. And Q2, as I mentioned earlier, tends to be our stronger quarter in terms of volume.

Fair enough. Now as a follow-up, as sort of more of your brown field facilities come online and expansions happen. Within the Americas you are becoming net long ethylene to the tunes of I would say over 1 billion pounds. So what is the plan associated with that ethylene? Do you want to continue sort of being a merchant seller of ethylene? Do you want to integrate into may be polyethylene units, I mean what’s the strategy there?

Well, we have many options in front of us. This is one of the topics that we will discuss next week at Investor Day, but briefly the options we have in front of us are merchant sales which there is still plenty of opportunities out there, a new polyethylene plant, or we could build another metathesis plant to make propylene. So we continue to evaluate that and we will discuss a little more in detail next week at Investor Day how we think about those options, but we think we have a solid options ahead of us and the bottleneck projects have very good returns.

Very good. Thanks so much, Bob.

Thank you, Hassan.

Thanks. Your next question comes from Vincent Andrews with Morgan Stanley. You may ask your question.

Thanks. And good morning, everyone. Bob, could you talk a little bit about sort of where we -- how we should think about the European operating rates over the next couple of quarters, obviously very high this quarter and obviously lot about it just, but how should we thinking about it into Q2 and then maybe thereafter?

European operating rates have been strong and in my view will be strong going into Q2. Vincent, there is a couple of things that are going on in Europe and I think are benefiting the operations there. One is the weaker euro is improving export competitiveness of our customers as the end users of our products. And we are seeing less imports because of the weaker euro. So more and more of what we are seeing is competitiveness of polyethylene or polypropylene exports as well as finished goods. The other is of course lower oil price makes Europe competitive on the global cost curve. So my sense is that we are going to run at full capacity for the foreseeable future Q2 and Q3. I don’t expect that to change.

Okay. Thanks. And as a follow-up, you addressed sort of how you think about the ethane price forecast going forward as it relates to new capacity. But what do you think might happen on the outlook price, on the polyethylene price as always new crackers come along, and presumably that product has get forced out into the export market and what do you think that could do to spreads for sort of balance for North America?

Well, I think longer-term as some of the larger green field capacity comes online that product will be exported on the increment to either Asia or to South America. And so the margins in the U.S. will largely depend on the crude to gas ratio and cost of production in destination markets like China. And so my sense is that just like the Middle East and years ago built out their capacity to export, will the U.S. will fulfill ethylene derivative demand growth in the coming years. And so I think the margins will still be good and in the sense the U.S. advantage is present today and could get better as the crude to gas ratio increases again.

Okay. Thanks very much.

Thank you.

Thanks. Our next question comes from Aleksey Yefremov with Nomura. You may ask your question.

Good morning. Your working capital declined slightly quarter-over-quarter? Do you expect to realize more pronounced benefit later in the year in terms of your working capital? Thank you.

We don’t expect any major swings in working through the end of the year. We exclude LCM in some of the Forex. It really were pretty flat on a normalize basis in terms of working capital. And we expect that kind of -- we’ll see some seasonality towards the end of the year, but no significant changes in working capital through the year.

Yeah. We don’t have any significant inventory dislocations in our system.

Thank you. And as a follow-up, another question on ethane, do you think there is enough pipeline capacity that connects the Northeast NGL producing regions to the Gulf Coast? We currently have one pipeline? Do you think there are more pipelines needed and if that is the case, do you think those pipelines can be build in time for ethylene crackers startups in 2018?

Well, I think, there is sufficient supply of ethane here on the Gulf Coast already. And as those crackers get built out, I would imagine that some of the lines that we are going south to north will be reversed and will get more ethane from the north.

Yeah. Aleksey, I think, in general Marcellus and Utica as they build up. Off take has been one of the issues. It’s been address first by the ATEX pipeline. There have been two more pipeline proposals. It’s a same in gas coming off of those facility but they have to build out the infrastructure. And really this is all part of what’s been going on in the industry really for the last five years. The E&P progresses than the midstream catches up and we been a logical beneficiary of it as they develop.

Thank you.

Thank you. Our next question comes from Don Carson with Susquehanna Financial. You may ask your question.

Thank you. Question on U.S. feed slate in the quarter and going forward. Bob, you mentioned that you -- 90% of your feed slate was NGLs, was 70 percentage points ethane. Is that 20% dealt to the max propane and butane you can crack and if so would you plan on any investments to increase your flexibility to crack propane and butane?

Yeah. Don, not necessarily that that 20% is the max and we have more flexibility within that. It’s just a question of economic and optimization, and how we run our crackers week to week, but we have flexibility. And remember we also crack some liquid feed stocks down in Corpus Christi. So its not just ethane and propane, we kind of crack full range.

And we’ll talk to this some more in the Investor Day as well.

Yeah.

Okay. And then just a follow-up on near-term pricing, it looks like polyethylene is going to rollover flat in April. There is an industry thought an initiative in May that looks like it has real support? How long you think this tightness in polyethylene is seasonal uptake that we’re seeing? What’s kind of your price outlook for not only in Q2 but also going into the second half of the year?

Well, I’ll speak to markets rather than price and I would say that, the supply demand is very firm today. And so there is market underpinning or what you see -- and so we’ll just have you see how the quarter develops. But I’m very bullish about demand for Q2. I think demand for Q2 will be very good as it is seasonal.

Thank you.

And so our next question comes from James Sheehan with SunTrust Robinson Humphrey. You may ask your question.

Thanks. Question for Karyn. How do you see the pace of share buybacks occurring through the rest of the year?

Yeah. We are going to -- we’ll continue to on the pace that we are at. We have the second 10% that will be wrapping up here in the May timeframe. And in our next Annual Meeting we have the authorization that we expect to get approval for an additional 10% going forward.

Thanks. And on the Refining segments you mentioned some maintenance occurring here in the second quarter. How do you see that affecting throughput?

I think it will be minimal. We just about completed and already started, we don’t think it’s going to be material for the segment.

All right. Thanks a lot.

Thank you. Our next question comes from John Roberts with UBS. You may ask your question.

Good morning. Nice quarter. One of the messages from the IAHS Conference last month was that we’re heading into a period where propylene would be long relative to ethylene. I don’t know if you agree with that? And if you do agree with that, how does -- is that going to play out through your polypropylene, propylene oxide. You mentioned you're looking at expanding metathesis? I don't think you do that along propylene market, but maybe if you could give us your outlook on propylene?

Sure. Thanks for the question, John. Well, propylene is one of those molecules that when its get long, the sources of production tend to adjust. So, for example, when propylene values fall, generally you crack less propane, you crack more ethane. For us we have the flexibility to run the metathesis unit or not to run the metathesis unit. We’ll certainly evaluate that as we think about investment. I know that IAHS has a view on propane. To propylene, the PDH plants when they come on. But remember as propane balances become narrower and propane price could rise and therefore, propylene from propane could become more expensive. So there are a lot of factors that impact the propylene price and it is very dynamic. So before we make an investment, certainly we would think through all of those factors.

So you’re thinking propane rises or are you thinking propane stays low?

I think if there’s a lot of propane consumption, propane could rise. And remember propane can be exported as well in a much larger quantities that ethane can. So we’ll just have to see how those supply-demand balances develop over the longer term. It all just depends on the timeframe.

Thank you.

And so our next question comes from Kevin McCarthy with Bank of America Merrill Lynch. You may ask your question.

Yes. Good morning. Bob, if we look at the industry data, looks like polyethylene resin exports surged something like 42% in March after five straight months of decline. So if you could talk about your own mix of domestic polyethylene sales versus exports and with outages overseas, would you expect the international trade component to remain strong?

Kevin, our exports have increased a little. But we -- as we’ve mentioned in the past calls, we tend to export a little bit less than the industry average. And generally, we have longer-term sales contracts going to South America rather than Asia. So our focus is less on Asia when it comes to exports. I do think that the industry has exported a bit more, I’ve seen that in some of the data that’s been published but for us it’s not significant in terms of the increase.

Okay. And then as a second question, it looks as though you're propylene monomer production increased 12% in 1Q versus 4Q. Is that all explained by your metathesis unit and then did you run that unit full out in the quarter or did you crack more propane as well?

It’s the combination of the two, Kevin. We did run the metathesis unit most of the quarter. That contributed to most of the propylene production increase. And then some of that was a bit more [Technical Difficulty] propane.

Okay. Thank you very much.

Mostly, metathesis.

Thank you. Our next question comes from Frank Mitsch with Wells Fargo Securities. You may ask your question.

Yes, good morning folks. And obviously a great start to the year. Bob, I’m just curious, obviously, a big deal relative to the three. From your perspective where there any big surprises, relative to what your expectations were three weeks ago, I'm sorry three months ago or not necessarily?

Good morning, Frank. For us I think what’s what we’ve seen develop over the quarter is that the market is a lot stronger that we expected and supply demand are much more balanced, some of these outages that we didn't predict. Our sense is that we are really realizing markets where operating rates are in that 90%, 92% range and when there are outages, it causes some margin expansion. And of course, I think prices come off a bit during the period. Our share repurchases have benefited us as well. There are a lot of factors. And we ran well as we are known to do. So not necessarily surprises, but I would say just more confirmation that we have a fairly strong market environment.

All right. Terrific. I do concur that given everybody running as hard as they are, you are bound to have more unplanned outages than what the consultants are setting out there. So knock on wood, it’s not even obviously your safety. Your safety slideshows that you know how to run assets? And then if I could ask a question on the I&D segment, you were talking about the PO/SM turnaround being about a $20 million impacting Q2. If I am not mistaken, I think you were thinking that the methanol turnaround in Q1 was also going to be a $20 million impact. But I think your comments today suggested that was closer to $10 million, is that correct and if so why was it less of an impact?

Yes. Actually, it’s just because of the way the margins evolve in the methanol business during the quarter versus our prior estimate. And then on the PO/SM unit it’s based on what we know today in terms of margins. But we’ve largely prepared and mitigated most of the impact of that PO/SM outage. And by the way methanol plant is running very well and at nameplate capacity. So the team at Channelview did a really nice job in conducting the maintenance, getting it back up and delivering on what they had intended.

Terrific and thank you so much.

Thank you.

Thank you. Our next question comes from Nils Wallin with CLSA. You may ask your question.

Good morning and thanks for taking my question. In terms of your own operations obviously olefins in Americans has been running at very high rates for multiple quarters. Is there a risk that do you need to either pull back on those units at some point to prevent an unplanned outage or how do you look at the higher rates over sustainable period?

Yeah. Good morning Nils. No, we are not running these units at above benchmark. We are not pushing them beyond their capability. And as we’ve mentioned in past calls, we’ve been very diligent in doing our turnarounds at the prescribed cycles and so on. So I would say that our discipline around maintenance and around how we manage our operations allows us to run at our nameplate capacity. But we're not pushing beyond that necessarily. We don’t want to go beyond the capability of the plant for near-term gain, that’s not our philosophy so. And we’ll continue to run within the capability of each of our units.

Understood. And then with respect to polyethylene inventories, do have a sense of what level they might be down at the customer converter level? There has been some discussion that distributors are starting to get their warehouses pretty full?

No, I haven’t heard any significant trend there. It could be that one or two have a bit more. But going into Q2, a bit more inventory shouldn't concern anybody because generally demand is very good. So my sense is inventory is kind of at par in the value chain. I don't think it’s very high or very low frankly.

Thanks very much.

Thank you.

Thank you. Our next question comes from Jeff Zekauskas with J.P. Morgan. You may ask your question.

Hi. Good morning.

Good morning.

Hi. Lyondell was always contemplating NLPs. Has it made a decision yet or positive or negative?

Jeff, that's one of the topics we were going to cover at Investor Day next week. So, we’ll provide our analysis and how we think about it and we'll discuss next week at Investor Day.

Okay. That sounds great. And then secondly, your tax rate keeps coming down even though you make more in the United States. Can you explain why that's the case and if there’s a difference between your book taxes and your cash taxes?

Yeah. As far as the guidance that we gave at the beginning of the year, it’s pretty much still in line that we are on 27% for an effective tax rate. And then on a cash tax basis, we are lower than that and we are in the 23% range. It’s fairly consistent with prior years. We continued our optimized -- our tax cash structure but we did see a slight, slight uptick here this quarter with larger earnings in the U.S. And you will see that as the mix of earnings for more North America based, you’ll see our rates 10 and 12 depending on what jurisdictions our earnings are at.

Okay. Thanks very much.

Thank you. Our next question comes from Duffy Fischer with Barclays. You may ask your question.

Yes. Good morning, guys.

Good morning.

Questions on say just the last 12 months if we step way back 50,000 foot view, lot of volatility in oil and some of your inputs, not very much volatility in your earnings, Bob, I wonder if you could just kind of -- if you step back a year ago and we told you what would happen with energy, what surprised you and what actually played out over the last year versus what you would have thought a year ago?

So, I think markets, they were a lot stronger than we thought they would be a year ago. Demand growth has been very good globally. There have been these unplanned outages recently that we discussed. Natural gas price has drifted down. So if you look at the graph that we had in our earnings report here. While crude oil price dropped and butane and propane dropped as well, ethane dropped. So we’ve seen our cost come off a bit. Our share repurchase program has also helped in terms of EPS, which is the intended purpose of the share repurchase program. And we continued to push reliability and push our units hard. So, I would say if there's one thing that I could point too to that’s perhaps a bit different is that supply-demand is just much stronger. And so price declines on products have not been at the same pace as the oil price might indicate.

Okay. Thank you. And then your catalyst business gives you a pretty good insight into what people are thinking about building on the olefins, polyolefins chain. When you look into that business, how do you see the next three to five years as far as your Olefins, polyolefins business grows global build out?

Yeah. So in the case of polyethylene, if you just look at IHS data, it’s even beyond our catalyst business. And supply growth is going to be somewhere in the 3% to 4% range annually. Demand grows at above that same pace. So our sense is based on what's been announced and the likelihood of some of the projects being pushed a year or two based on recent announcements. Our sense is that new supply will meet incremental new demand and that we could have a period of relatively high operating rates. And we’ll show that next week when we have our Investor Day, our own view and IHS’ view on operating rates.

Great. Thank you.

Thanks. Our next question comes from Bob Koort with Goldman Sachs. You may ask your question.

Thank you very much. Bob, you mentioned the volumes of your plastics in Europe were really quite exceptional. I think there maybe five or six force majeures during the first quarter or so. Where did all that product go? Were you displacing your competitors that couldn't run their plants at rates, or was there some restock inventories build and I'm speaking to Europe specifically and then how do you see that normalizing through the rest of the year?

Yeah. So in Europe, I think there were three factors. One was restocking. The other was just higher demand from our customers because of their export competitiveness, especially in film. Out of this film is where we see that the most. And then, yes, we did displace some of our customer sales when they had issues. And we also had a little bit of an issue at Münchsmünster, which we resolved. So it’s a combination of factors. My sense is that the European market is going to be pretty strong here in the foreseeable quarter or two. And then we'll have the typical seasonality in Q4, barring any sort of economic issue.

And if I may follow up in the Americas looks like Total and Shintech have put their name to the list that’s growing for U.S. new plant builds. I’m just curious do you think Lyondell will ever build a brand new plant or will continue to be the incremental adds? And then secondly, you mentioned ethane at fuel value, but the need maybe to start sucking in some barrels from North and Northwest or Northeast, would you expect that at least you see the ethane price have to accommodate that transportation tariff down to the Gulf Coast or do you think you can still sell below fuel value plus traditional spreads out into the future?

In the case of our expansion, Bob, we still have quite a bit in front of us in terms of the debottlenecks. We really evaluate as we do many other alternatives, green field type project, that completes with share repurchase program and other projects. So we’ll evaluate that. I know I wouldn’t say that we would never do it. It is one of the options, and so we will just continue to think through that. In terms of ethane and maybe incremental increase because of ethane coming north to south, it’s possible. But even if that increase were do occur, when you think about it on a global basis, ethane will still be advantaged compared to polyethane production in China based on naphtha. So my sense is that the ethane advantage and the U.S position on the global cost curve will largely be what we think it is today. There will be plenty of ethane and supply of this new expansion that are planned. And in the case of Shintech and Total, the timing of those were already essentially in the middle of the 2015. So I expect there are going to be towards the end of this wave of capacity that’s been announced.

Okay. Thanks very much.

Thank you.

Thank you. And our final question comes from Laurence Alexander with Jefferies. You may ask your question.

Good morning. Can you aggregate your cost advantage feedstock tailwind that you had in the quarter, in Europe and the U.S. and how you think about it for the balance of the year? And given the strength in the supply-demand balances that you're seeing, do you expect sort of bump in the number of brown field announcements before the wave of green field announcements gets done? Or do you think that that sort of capacity is tied off at this point?

Laurence, this is Doug. Let me try to take that first and then maybe Bob will add some. I think when you think of the advantage feeds, let’s go to Europe and look there. As we said about half of our ethylene was produced from advantage feeds. As percentage wise that where we’ve been running. What perhaps is different about that is this year because of the pricing of NGLs, we’ve been able to do it throughout the winter quarters. Now, the advantage we said it was down about $15 million from quarter-to-quarter, so it’s a little bit of that trending there. And of course, like we told you last year in our facilities, the benefit from advantage features a little lower $200 million across the year. So I’m going to give you kind of the picture of it, but I think key was the dynamic of the NGL markets even in the lower crude price allowed us to continue process enough at those rates. In the U.S, we are pretty much -- I think the graphs that we showed you pretty well showed you how you follow through. Our mix moved a little bit as it always does. Our guys optimize almost daily and weekly. So you move your mix a little bit around. Propane was attractive for a while, but that’s a penny or two versus ethane. So we’ve been able to hold those types of opportunities and advantages as we move forward.

And Laurence to answer to your question about brown field, potential brown field expansions, I think a lot of the debottlenecks sort of opportunities have been harvested because of the advantage that existed over the last two, three years. So, well, we might find some more, other companies might find some more. I would imagine that most of what was possible has already been harvested.

Thank you.

And at this time, I’m showing no further question.

Okay. Well, then I’ll offer just a couple of comments as we close out the call. Look we had a terrific quarter with strong performance across the entire company. Our focus on safety, operational reliability, commercial agility, and cost discipline, they continued to prove resilient in a volatile crude oil environment. I'm extremely proud of what our team across the world has accomplished and their continued focus on everyday excellence. I think that's really what defines us. We look forward to seeing all of you next week at Investor Day and thanks for your continued interest in our company.

Thanks. And this does conclude today’s conference. We thank you for your participation. At this time, you may disconnect your lines.