“We averaged about 40% for the first half, meaning we expect to increase the distribution percentage over the second half of the year.”

In context

“Andrew O'Brien (Chief Financial Officer and Executive Vice President, Strategy and Commercial (President and CEO-designate)): Thank you, Ryan. And thanks to you and the board for the confidence that you have shown in me. I am excited to step into the role of President and Chief Executive Officer. The company's never been in a better position, with a great portfolio and a strong foundation, thanks to Ryan's leadership and our world-class workforce. Kirk and Nick will remain important members of the executive leadership team and trusted partners as we move forward, continuing in their roles overseeing our operations. I am pleased to welcome Connie Haines Welsh to the team, our new Chief Financial Officer. She will be a great addition as we build on the strong foundation already in place. I am also looking forward to working with our broader organization as we continue executing with the same discipline and focus that has served us so well. Turning now to our second quarter performance, we produced 2.248 million barrels of oil equivalent per day. That was above the high end of our guidance, driven by strong operational performance across our global portfolio, including record Permian production. We generated $3.24 per share in adjusted earnings. Cash flow from operations was $7.2 billion and after $3 billion of capital expenditures, that translated into $4.2 billion of free cash flow. We increased our second quarter shareholder distributions to $3 billion. That included doubling share repurchases to $2 billion plus $1 billion of ordinary dividends. We ended the quarter with $8.1 billion of cash and short-term investments along with $1.2 billion of liquid long-term investments. In short, this was another quarter of exceptional operational and financial execution. Turning to our outlook, our full-year guidance items are unchanged; we remain on track to deliver our plan. For distributions, we continue to target returning 45% of our CFO to shareholders this year. We averaged about 40% for the first half, meaning we expect to increase the distribution percentage over the second half of the year. Third-quarter production guidance range is 2.290 to 2.320 million barrels of oil equivalent per day. This improvement from the second quarter is driven by a production ramp in Qatar and continued Lower 48 growth. This more than offsets the impact of non-core asset sales of 15 thousand barrels of oil equivalent per day in July. Now let me walk you through the three strategic updates: the completion of our disposition program, the additions to our commercial LNG portfolio and our new international opportunities. First, we achieved our $5 billion disposition target ahead of schedule with $1.7 billion of non-core Lower 48 asset sales in July. We were really pleased with the value we captured for these assets. While this completes our announced disposition program, disciplined portfolio management remains central to how we run ConocoPhillips. We will continue to high-grade and optimize our portfolio. That work never stops. Second, we recently signed two LNG offtake agreements each for 1 million tonnes per annum, one in Indonesia and one on the U.S. Gulf Coast. These additions bring our total offtake to 12 million tonnes per annum and mark another important step in scaling this business. Our commercial LNG strategy builds on our global scale and decades of LNG experience, allowing us to move lower-value natural gas into premium-priced international markets while maintaining full value chain control to maximize margins through the cycle. Third, we signed strategic agreements for low-cost-supply growth opportunities in Iraq and Syria. This builds on the improved fiscal terms we signed in Libya earlier this year. These opportunities are part of a targeted and deliberate strategy to build on our globally diversified portfolio advantage. Each is a high-quality, long-life conventional asset with demonstrated production and meaningful redevelopment potential. They have attractive entry costs and highly competitive cost of supply. These fields are already producing today and we expect the production to largely fund the redevelopment, delivering longer-term free cash flow upside with little to no impact on our capital spending. To wrap up, our strategic priorities are unchanged. They are clear, consistent, and durable, and they have served us well for the last decade. We will continue to grow our dividend at a rate competitive with the top quartile of the S&P 500. We will protect and further strengthen our investment-grade balance sheet. We will return a significant portion of our CFO to shareholders right off the top. And only after meeting all these priorities will we evaluate disciplined growth with a focus on improving our returns on capital employed. We are meeting these priorities while reinvesting to deliver a peer-leading $7 billion free cash flow inflection by 2029. That inflection is well underway. As free cash flow grows, our breakeven price comes down. Our reinvestment rate comes down, and our financial strength and competitive positioning further improve. Every measure moves meaningfully in the right direction. That concludes our prepared remarks. I will now turn it back to the operator to begin the Q&A.”