Good morning and welcome to the OXY first quarter 2017 earnings conference call. Please note, this event is being recorded. I would now like to turn the conference over to Richard Jackson, Vice President of Investor Relations. Please go ahead.

Thank you, Kate. Good morning, everyone, and thank you for participating in Occidental Petroleum's first quarter 2017 conference call. On the call with us today are: Vicki Hollub, President and Chief Executive Officer; Jody Elliott, President of Domestic Oil & Gas; Ken Dillon, President of International Oil & Gas Operations; Chris Stavros, Chief Financial Officer and Senior Vice President; and Rob Peterson, President of OxyChem. In just a moment, I will turn the call over to Vicki Hollub. As a reminder, today's conference call contains certain projections and other forward-looking statements within the meaning of the federal securities laws. These statements are subject to the risks and uncertainties that may cause actual results to differ materially from those expressed or implied in these statements. Additional information on factors that could cause results to differ is available on the company's most recent Form 10-K. Our first quarter 2017 earnings press release, the Investor Relations supplemental schedules, our non-GAAP to GAAP reconciliations, and the conference call participation slides can be downloaded off our website at www.oxy.com. I'll now turn the call over to Vicki Hollub. Vicki, please go ahead.

Thank you, Richard, and good morning, everyone. I'd like to focus on three topics in my opening remarks. First, I'll provide you an update on our portfolio optimization initiatives, and I'll share what this means for our near-term growth plans. Then I'll highlight some components of what we believe is our differentiated and value-based approach. And last, I'll provide details on our plan to get to cash flow breakeven after funding the dividend and growth capital. Turning to slide 4, in 2013 we began our strategic review process to divest of low-margin low-return assets and assets that simply could not compete for capital within our portfolio. We allocate capital based on the net present value of the project, the returns they generate, the cash flow profile, the reserves added, and its capital intensity. To support our value proposition, we need a balanced blend of short-cycle, high-growth investments along with low-decline long-term cash flow. But in both categories, we need relatively high-margin, high-return assets, and we need the ability to control our own destiny. By this I mean we need a high-quality development inventory with the potential to sustain our growth over the long term without needing to depend on acquisitions or the decisions of others. As the final step of our strategic review process, we have now divested of our South Texas gas properties, which were our last non-core upstream assets. Our remaining upstream assets are all within our core areas, which are the Permian Basin, Colombia, Oman, Qatar, and Abu Dhabi. The proceeds from the South Texas sale will be redeployed into Permian Resources. Given that Permian Resources margins are three times higher than South Texas gas, only 9,000 barrels of oil equivalent per day of Resources production is needed to replace the cash flow from the 27,000 barrels…

Thanks, Vicki, and good morning, everyone. Today, I'll focus on the following: a brief summary of our first quarter 2017 financial results, cash flow, balance sheet and liquidity items. And then I'll come back at the end of all of our prepared remarks to close out with guidance for oil and gas production, the other business segments and related items for the second quarter and full year 2017. Our first quarter 2017 reported income for GAAP purposes as well as our core income was $117 million, or $0.15 per diluted share. While higher product prices were a big factor in our sequentially improved earnings results, all of our operating segments demonstrated better than expected results. For the first time in nearly three years, the arrows are clearly pointing in a favorable direction for all of our core businesses. In addition to higher product prices, our realized prices for both oil and NGLs relative to benchmarks showed a marked improvement on a sequential quarterly basis in helping improve overall oil and gas profitability. Much of this was due to better than expected Midland to Cushing differentials during the quarter. First quarter oil and gas production volumes averaged 584,000 BOE per day, and all of our reported data incorporates production volumes for our South Texas gas properties, which have been sold. Permian Resources production grew 6,000 BOE per day, up 5% on a sequential quarterly basis to 129,000 BOE per day in the first quarter and in line with our earlier guidance. More than 80% of the quarter-on-quarter improvement in Resources production came from oil growth. Our total costs in oil and gas, including cash operating costs, DD&A and G&A, had a positive sequential pre-tax impact of about $130 million. Despite the planned and unplanned downtime, our international oil and gas operations…

Thanks, Chris, and good morning, everyone. In February, OxyChem safely completed commissioning of our ethane cracker that will produce 1.2 billion pounds per year of ethylene at our Ingleside, Texas facility. The project is a 50/50 joint venture between OxyChem and our long-term partner, Mexichem. The project included a dedicated 115-mile ethane pipeline and storage dome in Markham, Texas. This project is the first grassroots cracker built in the United States in over 15 years. Completion of the project both on time and on budget while maintaining tremendous health and safety performance throughout its construction is a testament to our employees and our contractors to execute and deliver on objectives. The cracker has been operating at design capacity since the latter half of March. In addition, we improved our ability to transport ethylene to and from our Markham, Texas storage dome throughout our pipeline. Most importantly, the ethylene produced by the cracker is being consumed at Ingleside facility in the production of VCM, nearly all of which is being exported to Mexichem facilities in Mexico and Colombia, where they convert the VCM into PVC and PVC piping systems. The successful completion of the project and the structure of our partnership with Mexichem assures that the cracker will continue to operate at high operating rates over the course of our 20-year agreement and that both parties will receive returns on an investment that well exceed our cost of capital. This investment is not based upon any secured merchant sales of ethylene or new VCM business, but rather allows us to further back-integrate our value chain to support existing business with Mexichem. This value-based approach is in alignment with our overall company goals. While we continue to invest in our chemical operations, including our latest investment in Geismar, Louisiana that will provide…

Thank you, Rob, and good morning, everyone. Today I'll provide an update on our Permian Basin business and how it's driving the plan that Vicki outlined in her opening remarks. Our efforts in the Permian are a clear example of how our differentiated value-based approach generates growth in value through a sustainable competitive advantage. As part of our corporate portfolio optimization, we will redeploy the proceeds from South Texas into three to five additional Permian Resources rigs, bringing the Resources rig count to 11 to 13 by year end, including outside operated. This activity will increase Resources 2017 capital to between $1.6 billion and $1.8 billion but without increasing OXY's capital budget of $3.6 billion. This activity is aligned with our value-based approach to development and should result in a moderate increase of about 10,000 MBOE per day to the 2017 exit rate. This impact will be more pronounced as we exit 2017 and enter 2018. We are pursuing trades, partnerships, and sales opportunities using the tail of our portfolio to fund accelerated growth within our core developments. We understand the value benefits of acceleration and believe our Permian inventory can support monetization opportunities and high-value long-term growth. We also appreciate the necessity for value-based development and have found that the NPV benefits of acceleration can be quickly offset by suboptimal development plans, so we will be disciplined in our approach to maximize shareholder value. Our value-based development begins with the subsurface and surface workflows, where we ensure all key attributes are aligned, including bench and well sequencing, well spacing, infrastructure, and technology advancements. We continue to apply innovative technology into our plans, and we will provide additional disclosure as we deliver results there. We understand the importance of cost leadership in our development plans, which starts with commercial strategies…

Thanks. With respect to guidance, we expect our full-year 2017 companywide production growth from ongoing operations and adjusted for the sale of South Texas to be in the range of 4% to 7% or between 595,000 to 615,000 BOE per day. This is unchanged adjusted for South Texas relative to what we said historically. This includes a modest impact of OPEC quota constraints and volume effects under our production sharing contracts due to higher oil prices. Our long-term production growth expectations remain at 5% to 8% per year. As a result of increased drilling activity later in the year, we expect production in the Permian Resources to exit this year at a growth pace approximately 30% higher than year-end 2016 levels. For the second quarter, we expect a significant recovery in total company ongoing production volumes and in the range of 580,000 to 595,000 BOE per day. Production at Permian Resources is expected to be between 135,000 and 140,000 BOE per day in the second quarter. Every $1 per barrel change in WTI affects our annual operating cash flow by about $110 million. In our Midstream business, we see a return to profitability, as we expect the second quarter to generate pre-tax income of between $5 million and $15 million. Foreign income from pipeline and other facilities should improve, as planned maintenance at Al Hosn and Dolphin was completed earlier in the first quarter. A large portion of the financial improvement in Midstream should be driven by wider oil price differentials between Midland and the Gulf Coast and partly as a result of rising production in the Permian Basin. In Chemicals, we anticipate pre-tax earnings of about $200 million for the second quarter as a result of continued improvement in caustic soda prices and the benefit of operations from the new joint venture ethylene cracker. Looking forward, our Chemicals business is on a pace to generate approximately $250 million per quarter of free cash flow for the remainder of the year. I'll now turn the call back to Richard.

Okay. Thank you, Chris. Kate, we are now ready for questions.

We will now begin the question-and-answer session. The first question is from Ed Westlake of Credit Suisse. Please go ahead. Edward Westlake - Credit Suisse Securities (USA) LLC: Yes, good morning and congratulations on the work on lowering breakevens. Maybe if I can talk about the dividend coverage. One of the numbers that helps when investors think about that is maybe the maintenance CapEx number, the CapEx to keep obviously your downstream units in operation and production flat. I don't know if you have an update on that, because obviously international costs are still deflating and the work you're doing in the Permian may have lowered that. So any color there would be helpful.

Ed, currently we're seeing about a $2.2 billion sustaining CapEx, but we do expect that to come down. We're seeing price improvements in international operations. We're also, as you've heard, still seeing significant improvements in our Permian Resources business so that we expect, as that capital intensity goes down, this will also decrease. But with our current situation, we're certainly less than $50 to be able to cover our sustaining capital and dividend. Edward Westlake - Credit Suisse Securities (USA) LLC: Okay. And then good color on the Chemicals. Thanks for that, that $400 million shift. The Midstream is improving, which is good to see. I don't know if you'd be able to hazard a guess at where you see mid-cycle Midstream earnings with the Permian perhaps closer to filling up the pipe sometime next year or 2019.

I think, Ed, certainly the arrows, as I said at the outset, the arrows are pointing in the right direction for that business as well. I think the differentials are suggesting that we see profitable periods for the remainder of the year, frankly, certainly in the second quarter and in the back half of the year as well. So if conditions continue to move in this direction as far as Permian production based on the rig adds that we've seen, it's, frankly, looking pretty good going even into – exiting this year and certainly going into next year as well. Edward Westlake - Credit Suisse Securities (USA) LLC: So you'd figure that there may be some acceleration around that at that point because, obviously, some of it's related to contracts you have that need certain volumes to be hit.

Yes, we would be profitable in excess of any contracts we have in place. Edward Westlake - Credit Suisse Securities (USA) LLC: Okay. Thank you.

The next question is from Doug Leggate of Bank of America Merrill Lynch. Please go ahead.

Thanks. Good morning, everybody. Vicki, I'm not sure who wants to take this one, but I think you've talked about the Permian previously being self-funding in 2018 at around $50. With the higher level of activity, and obviously I think Jody had pointed to the higher end of the growth rate, what does that look like now? Are you still self-funding at $50 oil in 2018 with the higher activity?

Good morning, Doug. This is Jody. Even with the higher activity rate, all it does is push that timeframe out a few months in 2018. So the improvement in capital intensity really does help that timeframe for the Permian Resources breakeven.

Okay. I appreciate that. The question that continues to come up, obviously, is around the dividend despite your assurances around breakevens and so on. So I wonder, Chris, if you could address one specific issue, which is the roll-off of your Middle Eastern contracts in Qatar, I think 2017 and 2019, respectively. What is the status of those contracts? Is it a material free cash contribution? And just a general status update as to how that might affect the breakeven calculus as you move forward. I'll leave it there. Thanks.

Doug, I'd like to start with that. We feel that we're in a good situation in Qatar. First, let me say we don't have anything rolling off in 2017. Actually, our ISND contract would be in October of 2019. But really what we're doing today in Qatar is, I believe, some of the best work that we've done anywhere in our company in a long time. I'm going to have Ken describe some of the things that we're doing there that give us some confidence that we would be able to extend that contract. Saad al-Kaabi, the CEO of Qatar Petroleum, the thing that mattered to him most is that we add the most value possible for every dollar we invest in Qatar. We believe that with the success our teams are having there, that we're going to be able to meet his expectations. And our teams are working well to be able to share best practices, to help each other to accelerate some of the technical work and new technologies that we want to do. So we've actually established some things there that are different than being done anywhere offshore in the Middle East. That, along with the fact that we successfully negotiated the extension of the Block 9 contract in Oman, gives me a lot of confidence that we'll be able to continue. I'll pass it on to Ken to give you some of the details around some of our activities.

Good morning, Doug. It's Ken. Our approach is basically the same as the one we went with for the Block 9 extension. Our goal is to remain the partner of choice in Qatar. We're focused on technology, reputation, and operational excellence. Our new innovative wellhead platform designs, which provide drilling for about 50% cheaper than conventional Middle Eastern platforms with 40% more capacity, are in detailed design at the moment. Our next-generation reservoir models for ISND and ISSD are nearing completion and showing positive results. And the combination of just these two aspects mean we can deliver the same reserves for less than half the cost than our previously submitted Phase 5 proposal. We're now starting to roll out OXY Drilling Dynamics and OXY lift, so we think we can make improvements on the Phase 5 performance. And we are already the low-cost operator in Qatar. The last thing I'd really like to emphasize is last year offshore we hit zero recordable incidents and we've had none this year. That's really excellent worker safety performance in Qatar and one that I think that the team should be proud of. So we're very focused on this. We have regular meetings and we continue to improve month on month.

Just to be clear, it sounds obviously you're – I can't help but think you're pretty optimistic about being able to extend the contract for a number of reasons. But could you quantify the free cash contribution in the current oil price environment, just to put that issue to rest?

Doug, the best way I would put it is that the plan we have in place from the other assets, and as Vicki discussed certainly around the Permian, would more than make up for cash flow absence if that were to happen in Qatar, I think is what you're asking. It's something that I would view as immaterial relative to the total cash flow that the company generates. By that, I mean less than 5% of the total cash flow that the company generates. So I think that based on the plan that we just laid out, we can accommodate additional cash flow growth and opportunities from the assets that we've got to make up for any shortfall if that were to occur, but we don't think that will happen.

So sub-$200 million sounds about in the ballpark?

That's probably right. That's right.

Okay, great. Thanks a lot, everybody.

And the next question is from Evan Calio of Morgan Stanley. Please go ahead. Evan Calio - Morgan Stanley & Co. LLC: Hey, good morning, guys. You guys are telegraphing a stronger commitment to a higher Permian growth rate exiting – I think it was 30%, which is at the high end of the range, in 2017, and you used operational momentum, asset sales, and balance sheet to support it. How do you think about the financial flexibility and willingness to support to continue to outspend if the commodity market remains challenging, or any thresholds? Specifically, you're stepping up as that market is backing off some.

Evan, we want to continue to grow Permian Resources. This is really a drive to continue to lower our cash flow breakeven for not only our growth capital but for additional opportunities in ways that we could use our cash. So currently, we'll continue to be active and aggressive with our development in Permian Resources. We're going to fund that through resources that we have. And so in an oil price above $50, $50 or above, we're going to continue on this path to get to a lower breakeven for our growth capital as well. Now if commodity prices are not what we expect, we would certainly adjust our plans because we do have that flexibility. But at prices above $50 and above, we'll continue on our plan. And with what we see, we expect that this year we will average better than $50, and then next year will be we think even better than that. Oil prices are doing pretty much what we expected them to do. We expected to see volatility early in the year. We expect to see that until inventories come down much further than they have so far. We do have contingency plans, but as of right now with what we see we'll continue aggressively on this path.

And, Evan, this is Jody. I think that's the reason why we provided you the guidepost between the 20% and the 30% CAGR case to show you that even with growth there's some flexibility in the capital depending on commodity price. Evan Calio - Morgan Stanley & Co. LLC: Right. And I guess you're running the exit rate at 11 to 13 rigs, which is well above the 9-year average for 2018. It sounds like that's something you'll address as you go into that budgetary period.

Exactly. Evan Calio - Morgan Stanley & Co. LLC: Second question, you guys are talking about adding 500 locations to your sub-$50 Permian Resources inventory in 2017. Could you just provide color on what's driving the additions or where is the focus? Are these new locations or moving existing locations down the cost curve, or within that, the 350,000 acres that are in your portfolio, whether you don't have associated location counts? Any color on that program would be helpful.

Evan, good question. And you sound a little like Vicki. I give her 400, and she changes it to 500. It's 400-plus, but our stretch is bigger than that. It's really coming from multiple places. It's second and third bench development in existing areas, so taking benches that may not have been profitable and finding ways to make them profitable through either the lower capital intensity, the better production rate. It is some from the acreage outside of the core areas. But again, you've got to remember, our inventory is big in those core areas. So we're not just working one area; we're working both. I think the other thing that really we see happening is wells – we're not adding wells in some cases, but we're moving them to the left in that inventory curve. So the breakevens are coming down, so really working all three areas.

But, Evan, let me add. I do appreciate you driving up Jody's target. Evan Calio - Morgan Stanley & Co. LLC: It's at 600, right?

I was looking for that.

The next question is from Roger Read of Wells Fargo. Please go ahead.

Hi, good morning. I guess I'd like to understand. As we think about some of the cash margin and the cash breakeven here, the sale of your South Texas assets, how does the cash margin on something like that compare to the reinvestment? I recognize it's not a sell yesterday, get the cash flow tomorrow kind of thing, but what's the general today to say Q1 next year thought process on something like that?

What we looked at was the replacement ratio, which is 9,000 barrels of oil equivalent per day, which is three-to-one for Resources production versus South Texas production. And with the funds, we've added sufficient rigs to be able to make up that difference and that cash flow within about five to six months.

That's pretty nice cash payback?

Yes, it is.

All right. And then a follow-up to an earlier question on the Midstream. The expectation is that as pipelines start to fill, you're able to recapture some of the differential in the Midstream, something that hasn't been the case over the last probably 18 months. But there's also a lot of expansion in the pipeline system going on. So I was just thinking. As we look to 2018, has some of that recapture potential slipped from 2018 and maybe into 2019, just any clarity you can offer there?

Currently the expansions haven't really occurred, so we're still seeing some benefit from that. Now we expect that through the rest of this year we'll see benefit. Going into 2019, it will depend on the growth trajectory within the Permian Basin, but we do expect significant growth. So we're right now anticipating continued improvement in our Midstream business because of that.

Any way to think about quantifying that though in terms of – I'm just really trying to think. There's typically a utilization level to think about, but then there's also the actual differential. Where are we today on utilization relative to where you think we need to be to start seeing you capture of that differential?

I think we're capturing it now. It's clear in our results. And that was, as I said in the prepared remarks, that was a large portion of the driver for the second quarter improvement. And based on how things are transitioning, it should potentially accelerate in the back half of the year. So I think you're seeing that.

Okay, I'll follow up offline, but I appreciate it. Thank you.

Your next question is from John Herrlin of Société Générale. Please go ahead.

Hi. With respect to big data, could you be a little bit more specific about what you're doing? Is it for better frackability, better design in your wells? What specifically are you doing, and what kind of savings do you think it will bring you?

John, this is Jody. It's really multiple areas. One of the first areas was a multi-variant analysis combining both geologic data and completion data to speed up the process of finding optimum frac designs. We're utilizing analytics and OXY Drilling Dynamics. It's what we call OXY Drilling Dynamics 2, which is putting predictability of motor yields and motor performance into that program. It's around reservoir modeling, being able to take what we do as a very – just slower process for reservoir optimization using very robust models, we actually are using a low-resolution model that we can optimize the injectant more on a real-time basis. That applies in Mukhaizna for steam flood. It will apply to our water floods. And then we will move to our CO2 flood. So these higher-cost injectants get optimized on a day-to-day basis. And I could just keep going here. The list is longer than the resources to tackle these, so we're putting them in priority order. We're really excited about what analytics can do to real step changes in our business going forward.

Great. Then the next one for me is on your logistics hub. Is this enough for your intermediate-term growth, or will you be building another one down the line?

So in southeast New Mexico, it's sufficient for our intermediate and long-term growth. There's quite a bit of capacity there. We also see it, as you mature in an area and you move off of the rapid growth and now you're into the day-to-day operating cycle, we have enough space there that you can start thinking about maintenance shops for pumping units and compressors. And so it migrates over time from a capital logistics and maintenance hub to an operating hub. And so we're looking in both Greater Barilla Draw and now in Midland to see what aspects of the Southeast New Mexico project make sense there.

Great. Thanks very much.

Your next question is from Paul Sankey of Wolfe Research. Please go ahead.

Good morning all. Thank you. Vicki, historically the company's differentiation, and you spoke about differentiation in your comments, has been the dividend and the growth in the dividend. I assume that the lower breakevens that you're talking about and everything else are ultimately aiming towards the growth in the dividend approximately in line with volume growth. Is that fair? And could you also just repeat the free cash flow numbers from Chemicals? And, if you could, give us that number for the quarter? That would be all part of the same thought process. Thanks.

Yeah, Paul. We're trying to drive our cash flow breakevens down just for that. What we want to do is be positioned to be able to resume significant growth of the – or maybe I should say moderate growth, not exactly the growth we've seen over the last 10 to 15 years prior to the downturn in the dividend, but we do want to grow the dividend at a meaningful rate. So that's the reason for this accelerated growth to get to a lower breakeven.

And the Chemicals?

Rob?

Free cash flow from Chemicals should be in the range of about $750 million for the year.

That's for this year and that could then be considered a run rate?

Plus the additional $75 million I described in the prepared remarks for the contribution full year of the cracker and the refrigerant plant.

The run rate, Paul, as I said, is $250 million for each quarter for the remainder of the year and then it accelerates into 2018.

Yeah. I just thought it actually bore repeating and I wanted to make sure I heard you straight. That's great. Thanks very much indeed.

The next question is from Phil Gresh of JPMorgan. Please go ahead.

Hey, hi. Good morning. My first question is just going back to the cash flow breakeven at $50 WTI. The slide was talking about including growth capital in the number. So I was wondering what total capital number you're using there. Would it be consistent with the $3.6 billion that you're talking about for this year, or a higher number?

Ultimately for 2018, the number would be higher. But on a run-rate basis, to provide the 5% growth would be somewhere in the $3.6 billion to $3.9 billion range.

Okay. So if I look at that slide then and I take $3.6 billion or something slightly higher and the dividend of about $2.4 billion, that would imply CFO of around $6 billion at $50 WTI. And, Chris, I know a couple quarters ago for this year you talked about I believe at $50 it's $4.5 billion. So I was just wondering what drives a one-third increase in the implied CFO to get to that breakeven.

What drives it higher is the better margins and better productivity and better wells that we're seeing in the Permian Basin, number one, better margins and the refocus of the capital that we've discussed today from South Texas and from other things going forward. What drives it is the improvement relatively versus several quarters ago in the Chemicals business. What drives it is the improvement in the Midstream business that we're seeing that we had not seen several quarters ago. So there are several items that, frankly, have changed in a markedly better way that give us more confidence in our ability to generate that higher number going forward with the reinvestment and better conditions in some of the other businesses.

Okay. Got it. Last question, just the domestic OpEx number. Chris, I think it went from $13 billion to $14 billion for the year. I was just wondering. What was the main driver of higher domestic OpEx?

Yeah, the main driver really is just reconstituting the number for the absence of South Texas going forward and a little bit higher prices for injectant CO2 prices. That's really it.

Okay. Thank you.

The next question is from Brian Singer of Goldman Sachs. Please go ahead. Brian Singer - Goldman Sachs & Co.: Thank you. Good morning. I appreciate some of the specifics on big data in response to the earlier question. I wanted to probe on what you think is uniquely going to be OXY here because I think beyond the secondary and tertiary recovery that has long been an OXY strength, it seems like you're confident in the ability to drive higher recovery rates from primary drilling versus peers. And I wanted to see what you think gets you to a superior recovery rate versus simply increasing recovery rate at a similar pace as your competitors.

Brian, this is Jody. At this point, probably not talking about what recovery mechanism might be the optimum. We've got experience everywhere, Ken's Mukhaizna field, the Qatar field, in our EOR business we find ways to get the most recovery out of these reservoirs economically. And so we believe the unconventional business is an incredible target because the recoveries in primary are so low. And so we believe OXY is uniquely positioned to find that extra 5% or 10% additional recovery and leverage the infrastructure investment we've already made in those fields. Brian Singer - Goldman Sachs & Co.: And that is in part by the various types of data analytics that you mentioned in response to the earlier question that you think will end up being more proprietary?

I think analytics plays a role there in accelerating your learning because you can do many things by analyzing the data quickly with different models that prevent you from having to do them with experiments or trials in the field. But it will be a combination of data analytics, field trials, laboratory work, research work that then point us to the right application of a technology, depending on which type of reservoir. Again, it all begins with the core understanding of the reservoir. Does the underlying rock fabric have some higher fraction of conventional fabric? Is it truly a source rock shale, very high organic? That application will be specific to the reservoir. Brian Singer - Goldman Sachs & Co.: Thanks. And then on the SL2, the multi-lateral wells, can you talk to the timeline for pilot results and what those pilots look like versus the schematic on slide 20?

We've completed our first one. We've drilled the second lateral, and the key part of that is we have stimulated the second lateral. So as the second lateral depletes, we're in the process of removing the frac string and then we'll put it on artificial lift. We'll do more of those this year. The real application of the technology plays out in 2018 and beyond because that's when you're doing your second and third bench development as a higher proportion of the program. Brian Singer - Goldman Sachs & Co.: Thanks, one very quick one, Chris. Did you say earlier what you expect 2Q asset sale proceeds to be net after tax?

We said – or I said that I expect the proceeds from South Texas to be nearly $600 million net after tax. Brian Singer - Goldman Sachs & Co.: Thank you.

And the final question today comes from Doug Terreson of Evercore. Please go ahead.

Good morning, everybody. I just have a quick question on corporate governance and specifically your new documents, which indicated a little bit of a shift away from the returns-based metric that you've used historically in favor of payouts that are based on total shareholder return, which is pretty similar to that of your peers. And so when you consider the emphasis on returns and value in your materials and commentary today, which is pretty prominent, my question is was this change undertaken because returns and other measures appear to be consumed by total shareholder in your view, or is something else at work here, meaning why did we have the shift there?

We had a shift because it was really a situation where we wanted to ensure that we were still looking at the metrics with respect to how others are performing. In the cyclic industry that we're in, we're in a situation where returns were very much impacted, as you know, by oil prices. Now we're in a situation where we have internally targets for all of our executives that are based to some degree on a returns metric. Going forward, we expect to resume including the returns metric as a part of our performance management programs. And that will be because of the fact that we believe that in the situation that we're in today, we're now generating positive earnings. We'll generate again positive returns on capital employed. And that's always been something that's been important for us, and it will be and is today an internal metric.

Okay, so it's as important as it's ever been, it sounds like.

It is. That's why we've talked about it so much today. We're really building our business and we've gone through this whole process, this painful process I'll say of exiting 300,000 barrels a day to get us into a position where every dollar we spend goes for the highest possible return projects. Exiting the things that we did with the timing that we had has now given us the opportunity to grow production with the best possible quality assets. And you look at it, every asset we have today is generating double-digit returns on capital employed. And so we're better positioned now to take advantage of that, and our company is going to be able in the future to excel in that area.

No, that's textbook. Thanks a lot.

Thank you.

This concludes our question-and-answer session. I would like to turn the conference back over to Richard Jackson for closing remarks.

Thank you, Kate. We would just like to thank everybody for joining us today and look forward to future discussions with our team. Thanks.

This conference has now concluded. Thank you for attending today's presentation. You may now disconnect.