Liberty Energy (NYSE:LBRT) reported first-quarter financial results on Thursday. The transcript from the company’s first-quarter earnings call has been provided below.
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Summary
Liberty Energy reported first-quarter 2026 revenue of $1 billion and adjusted EBITDA of $126 million, driven by high fleet utilization and technology-driven efficiency gains.
The company is strategically investing in distributed power generation to meet rising demand, with a focus on integrated solutions for hyperscalers and large load customers.
Liberty Energy executed $1.3 billion in convertible debt offerings to support its growth and aims to deploy 3 gigawatts of power by 2029.
Operationally, the company is advancing its DIGI Technologies platform with natural gas engines and variable speed capabilities, enhancing efficiency and reducing costs.
Management expressed confidence in the cyclical recovery of the oil field and the secular growth in power demand, while emphasizing the importance of energy security in light of global geopolitical tensions.
Full Transcript
OPERATOR
Welcome to the Liberty Energy Earnings Conference Call. All participants will be in listen only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today’s presentation there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Anjali Voria, Vice President of Investor Relations. Please go ahead.
Anjali Voria (Vice President of Investor Relations)
Thank you. Good morning and welcome to the Liberty Energy first quarter 2026 earnings conference call. Joining us on the call are Ron Gusick, Chief Executive Officer and Michael Stock, Chief Financial Officer. Before we begin, I would like to remind all participants that some of our comments today may include forward looking statements reflecting the company’s view about future prospects, revenues, expenses or profits. These matters involve risks and uncertainties that could cause actual results to differ materially from our forward looking statements. These statements reflect the Company’s beliefs based on current conditions that are subject to certain risks and uncertainties that are detailed in our earnings release and other public filings. Our comments today also include non GAAP financial and operational measures. These non GAAP measures including EBITDA, adjusted EBITDA Adjusted net Income, adjusted net income for diluted share, adjusted pretax return on capital employed and cash return on capital invested are not a substitute for GAAP measures and may not be comparable to similar measures of other companies. A reconciliation of net income to EBITDA and adjusted EBITDA net income to adjusted net income and adjusted net income per diluted share and the calculation of adjusted pretax return on capital employed and cash return on capital invested as discussed on this call are available on our Investor Relations website. I will now turn the call over
Ron Gusick (Chief Executive Officer)
to Ron. Good morning everyone and thank you for joining us to discuss our first quarter 2026 operational and financial results. Our first quarter results were driven by outsized demand for Liberty’s premium completion service offering outstanding operational execution and technology driven efficiency gains revenue of $1 billion. An adjusted EBITDA of $126 million reflected record pumping efficiencies and high fleet utilization while absorbing the full realization of pricing headwinds and winter weather disruption. Despite a three year slowdown in industry completions activity, Liberty has continued to deliver record performance quarter after quarter, an achievement that is no small feat. I want to thank the team for the hard work and dedication throughout this period that has prepared us well for the next phase of the cycle. We are confident that the North American oil and gas industry has established a cyclical floor. We are seeing an accelerating shift in momentum driven by unprecedented oil and gas supply disruption and renewed focus on the importance of energy security. By strategically investing through this period of frac industry softness, we are well positioned to generate superior returns as the focus shifts to secure North American supply. Distributed power generation demand continues to build as grid interconnection bottlenecks, utility imposed operational constraints and system congestion drive hyperscalers toward on site power as the preferred long term model. This shift is reinforced by extraordinary hyperscaler investment in infrastructure, supporting voracious demand for AI enabled productivity increases. Widening policy mandates to expand generation capacity and provide grid resilience within local communities further encourage distributed power solutions. As customer requirements grow more complex, Liberty is experiencing more direct collaboration with hyperscalers expanding beyond the developer ecosystem. Large load customers are increasingly prioritizing fully integrated end to end power solutions that bring together land, fuel sourcing, midstream and generation infrastructure, grid interconnection, on site power delivery, load optimization and lifecycle operations. LPI provides seamlessly delivered power through a single trusted partner. Onsite power is a complex operational symphony that requires a sophisticated ecosystem of telemetry, logistics and technical readiness. At LPI, we have built a comprehensive execution solution designed to manage this complexity at scale from a globally integrated supply chain and a mobilized workforce to an AI driven technology overlay to ensure peak performance. Our commitment to reliability is anchored by our LAAT advanced testing facility where we rigorously validate the integration of hardware, software and dynamic load following performance for real customer load profiles in a controlled low risk environment. Our microgrid testing facility in El Reno is designed to evaluate how complex multi source energy systems within the FORTE offering, perform under dynamic operating conditions using our Tempo proprietary control system that governs overall system behavior. It is structured around three phases of validation. First, a software phase evaluates system performance from a first principles perspective, allowing us to understand how generation, storage and power electronics respond to dynamic customer load while also supporting system resiliency and equipment lifetime. This work informs control tuning, system architecture and the type and size of supporting assets required. Second, a hardware in the loop phase applies these learnings using the physical control system operating against simulated generation, storage and load assets. This allows us to assess response times, control logic and system coordination by validating how real controller decisions interact with dynamic system behavior before physical equipment is introduced. Third, integrated system validation brings physical generation, storage and power electronics together on a common bus to serve representative load profiles at meaningful scale while not full plant capacity. This step ensures that control logic, hardware interfaces, protection schemes and dynamic response translate correctly onto real equipment and operating conditions. By progressing from modeling to controller validation to Integrated system testing. We identify integration risks and control issues prior to field deployment, providing our customers with the operational certainty required to support the next generation of data center demand. In completions, we are at the leading edge of equipment innovation and design, redefining how systems are built through our DIGI Technologies platform. We are excited to reach commercial deployment of the latest digiprime technology, the only 100% natural gas engine with variable speed capabilities in the oil field. In addition, we now have a path to upgrade our engine control software to enable variable speed on our early digiprime Rolls Royce MTU pump systems. Upon completion of the update, over 70% of our digiprime fleet will have variable speed capabilities and increased horsepower. Simply put, these developments mark a major advancement in the design and engineering of mechanical power systems, improving overall efficiency and reducing total costs. This is purposeful and focused evolution of technology, a continuous improvement loop where we design, test, validate and scale across our fleet. We are building upon years of experience in designing complex engineering systems and equipment innovation from DIGI FRAC Electric fleets to DIGI prime direct drive systems and now variable speed capabilities, that foundation of engineering expertise empowers not only the oil field but also our power applications. Liberty is pushing FRAC efficiencies to new heights through the integration of real time execution control and continuously learning intelligence. STEM Commander, our advanced fleet control software automates rate and pressure control in real time to improve stage consistency and reduce variability, while Forge, our cloud based optimization platform, continuously learns from fleet wide data to enhance performance over time through closed loop feedback. Together they create a system that compounds efficiency across every stage of execution, delivering more consistent operations and a lower cost per barrel of oil. In today’s high oil price environment, operators are increasingly focused on total fuel consumption and well site efficiency and our integrated system delivers meaningful reductions in fuel intensity and optimization of natural gas substitution in dual fuel systems. The performance gap between industry frac fleets is increasingly defined by the strength of this digital intelligence layer, allowing us to support improved well economics. Liberty’s success is based on innovation and disciplined investment, consistently seizing opportunities. Through every phase of the cycle. We have strengthened our platform and enhanced our ability to deliver differentiated performance, positioning us well to benefit from both cyclical recovery in the oilfield and the secular growth in power demand. During the first quarter we executed $1.3 billion in convertible debt offerings, further strengthening our financial flexibility and positioning us for durable long term growth. Concurrently, we entered capped call transactions at a 150% premium to the reference share price designed to preserve substantial upside for shareholders by meaningfully reducing potential dilution from these offerings as we execute on our growing power opportunity. This enables the necessary investment for long lead time items to achieve our 2029 goal of reaching 3 gigawatts of deployed power. The structural disruption in the Middle east has catalyzed a fundamental shift in global supply side dynamics, establishing a higher baseline for energy security and recalibrating the risk profile of regional supply in oil markets. The conflict in Iran has driven attacks on regional energy infrastructure and the unprecedented effective closure of the Strait of Hormuz inducing higher oil prices and and raising the prospect of a sustained increase in supply side risk premiums. In parallel, global LNG markets may face multi year supply constraints following attacks on Qatar’s Ras Lafan hub and other regional gas infrastructure. The resulting shock is most acute in Asia where high import dependence is forcing demand rationing amid constrained physical supply. The shale revolution has allowed the US to become the world’s largest oil producer and LNG exporter, securing our energy future while providing a reliable supply source for consumers worldwide. Over time, geopolitical dynamics may support structural tailwinds for North America as global consumers reevaluate energy supply chains and diversify sourcing with greater reliance on US and Canadian sourced oil and refined product supply. As the markets weigh rising concerns over physical oil and gas supply shortages against potential ceasefire implications, North American E and P companies are evaluating a range of macroeconomic scenarios. The recent rise in oil prices is well above early year expectations now driving substantially better E and P economics with greater potential for increased free cash flow generation. Moving to the power outlook, U.S. demand estimates continue to accelerate, exemplified by ERCOT’s recent projections that Texas grid demand could quadruple by 2032. This significant expansion is being met by a fundamental shift in the commercial landscape. Hyperscalers and other large load customers are increasingly relying on distributed power service providers to self generate and bypass traditional grid constraints. LPI is uniquely positioned as the enabling infrastructure provider supporting customers as they transform from large scale power consumers to more localized on site energy users rather than grid dependent power users. LPI’s scalable decentralized power solutions provide the critical operational infrastructure for these large load customers with the ability to support local grid stability. In the second quarter, we expect sequential growth in revenue on increased utilization and corresponding improvement in profitability. While a challenging market in recent years led many to retrench, we chose to lean in and accelerate strategic investments. We have fortified our competitive advantages in power and completion technologies and are well prepared to meet the rising demand for our services that Liberty is seeing today. Recent events have reinforced the importance of energy diversification for global consumers and we are proud to support the growth of reliable energy sources worldwide, including through our alliances and investments in Oklo Fervo and the Australian Beetaloo Shale Basin. I will now turn the call over to Michael to discuss our financial results and outlook.
Michael Stock (Chief Financial Officer)
Good morning everyone. The first quarter set a strong tone for the year. We overcame significant January weather disruptions and quickly returned to strong efficiency and utilization as the quarter progressed. We closed the quarter delivering record level output, generating more horsepower hours in the quarter than ever before in our 15 year operating history. Let’s turn to the Earnings results in Q1 2026, revenue was 1 billion, slightly below the prior quarter but modestly higher than the year ago period. Our results reflected the full realization of pricing headwinds and winter weather challenges partially offset by strong operational execution and customer demand for Liberty fleets. First quarter net income of $23 million compared to $14 million in the prior quarter. Adjusted net income of $10 million compared to $8 million in the prior quarter and excludes $12 million of tax effective gains on investments. Fully diluted net income per share in the first quarter was $0.14 compared to $0.08 in the prior quarter and adjusted net income for diluted share was $0.06 compared to $0.05 in the prior quarter. First quarter adjusted EBITDA was $126 million. General and administrative expenses totaled $60 million in the first quarter compared to 65 in the prior quarter and included non cash stock based compensation of approximately $6 million. Excluding stock based compensation, GNA decreased 5 million from primarily due to higher variable compensation costs recognised in the fourth quarter. Other income items totaled $10 million for the quarter inclusive of $17 million of gain on investments offset by interest expense of approximately $8 million. First quarter tax expense was $9 million, approximately 29% of pre tax income. We expect tax expense for the remainder of 2026 to be approximately 25% of 20 pre tax income and do not expect to pay material cash taxes in the year. We ended the quarter with a cash balance of $699 million and net debt of $579 million. Net debt increased by $360 million primarily due to convertible debt issuances. Total liquidity at the end of the quarter, including availability under the credit facility was $1.2 billion. First quarter uses of cash included capital expenditures and $15 million of cash in cash dividends. Net capital expenditures and long term deposits were $133 million in the first quarter which included investments in DIGI fleets, capitalized maintenance spending, power generation and other projects. We had approximately $24 million of proceeds from asset sales in the quarter. Recent geopolitical developments have introduced both volatility and opportunity, shifting market momentum and reshaping our outlook. We are seeing customer demand inquiries accelerate with customers turning to Liberty for fully integrated services to support their goals. With demand for Liberty fleet’s exceeding capacity, we are working diligently to plan to accommodate this demand and selectively deepening relationships with strategic customers who value differential services. Our second quarter is expected to see early benefits as customers accelerate DUC activity and and evaluate future plans. As a reminder, our 2026 completions capex investment moderates meaningfully from prior years, but includes ongoing investment in DIGI fleets that have structurally advantaged economics versus competing next gen technologies. Our completions free cash flow is strengthening in power. We are similarly seeing more customers gravitate to lpi. Our collaborative framework and turnkey power solutions are gaining traction as end users prioritise fully integrated one stop solutions that reduce the complexity of finding and securing powered land. To advance these efforts, we currently have planned contract milestone payments of approximately 300 million in the second quarter or early part of the third quarter that secured generation capacity in support of our 3 gigawatt plan for 2029. Power opportunities inherently carry longer duration time horizons as with multi year execution cycles and these costs will ultimately be funded by Project Finance. As discussed on our prior calls, we remain focused on driving long term value creation, positioning our premier completions business to lead through market cycles and scaling our power infrastructure platform to meet the growing demand for power services. I will now turn it back to the operator for Q and A, after which Ron will have some closing comments at the end of the call.
OPERATOR
Thank you. We will now open the line-up for your questions. To ask a question you may press Star then one on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to Withdraw your question. Please press star then two at this time. We will pause momentarily to assemble our roster. The first question today comes from Scott Gruber with Citigroup. Please go ahead.
Scott Gruber (Equity Analyst at Citigroup)
Yes, good morning and good quarter. I was wondering if you guys could just kind of unpack the, you know, the completion fundamentals from here. Obviously activity is improving. White space is kind of getting squeezed out of the calendar. Seems like pricing is improving and obviously you’ll lap the the winter storm for an impact from last quarter. Maybe you can just kind of walk through those pieces and any color you can provide on the activity uplift and if you’ll start to see some pricing in the second quarter or whether that’s a second half phenomenon.
Ron Gusick (Chief Executive Officer)
Thanks for the question, Scott. I think you’ve characterized most of that very, very well. We are in a different position than we would have anticipated going into this year. So as I said in my opening remarks, we definitely feel like the market is quite tight today from a utilization standpoint. We went through the end of the calendar year, us and our peers, right sized fleets for the outlook on work and as a result have relatively well utilized capacity prior to any uptick in activity. Now that’s not to say there aren’t some fleets on the sidelines. We believe there is some capacity that that could come back. But I think the message is pretty consistent that that’s a relatively limited amount of equipment and that there’s going to be a meaningful capital investment for that to happen. As a result, I would say as you start to look forward, there’s a few things at play. Number one, we went into the year with a relatively strong calendar to start with. We already had pretty strong utilization. We’ve had inbound calls around accelerating activity at this point. So those customers who had DUCs in their inventory are reaching out and asking about the opportunity to get those onto the calendar sooner rather than later. On top of that, you’re starting to see some reaction from the privates. You’ve heard some announcements around a commitment to increased drilling activity over the remainder of the year. And while we don’t feel that impact immediately, you know, those inbounds start to come for planned completions. Activity later in the year again, just starting to absorb any remaining white space that was left on the calendar. As that white space gets soaked up, then comes that conversation around restarting capacity. As we’ve said, we don’t have any capacity on the fence. We have no additional pumps that we had sidelined. And so for us that conversation really starts to look like a price conversation. Our sales team has been out in the market today engaging in that conversation with our customers, recognizing that their economics have changed meaningfully over the last number of weeks and that while we were responsive on the way back down, we feel it’s reasonable now to ask for some of that on the way back up. I would say that they are having great success in those conversations and that we will start to recognize some of that price here in the second quarter along with a bit of utilization improvement. To the extent we had white space on the calendar. The biggest impact of that is going to be felt in the back half of the year, but we’re certainly going to feel a little bit of that here in the second quarter. I would say it’s still early days for the bigger picture stuff to play out. We haven’t yet heard really any of the publics make a statement around increasing their expected spend this year. I think they’ve started to hint at it. You’ve heard some companies at some of the most recent, recent conferences talk about that idea, but they’ve not yet acted on that. And so we will wait to see how that plays out and then start to plan for the back half of the year and potentially early 27 accordingly. Michael, do you have anything to add there? Hi Scott. Yes.
Scott Gruber (Equity Analyst at Citigroup)
Oh, sorry. Okay. No, I was, I didn’t know if you had any additional comments there, Michael, whether we’re good. Okay, thanks. Also, I’ll follow up on the, the power business, if you don’t mind. You know, it seemed like initially in power you guys were focused on a broad set of opportunities and then I don’t know, maybe call it. Over the last 612 months there’s been a focus more on the data center opportunity, which probably reflects not wanting to tie up capacity on smaller, shorter term deals as bigger projects and bigger contracts are coming down the pipe. And maybe my perception is off on that a bit. But just how do you view kind of where you should put your marketing efforts in power? Are you comfortable with the focus that’s kind of mainly on data centers or do you think about taking a broader approach to establishing a kind of more diversified business? Just how do you think about where to put your marketing efforts and power?
Ron Gusick (Chief Executive Officer)
Scott, We’ve definitely not chosen to focus specifically on one area. While data centers of course are all the talk, they are all the news today and certainly what gets all the front page headlines just given the massive growth and the incredible amount of capital being deployed there. Our marketing efforts certainly remain broad based. We fully anticipate doing work not only with the data centers, but also outside of that space in other commercial and industrial opportunities. I would say that as you might expect, the demand for power generation co located behind the meter just continues to get larger and larger and larger. And while that’s happening in the data center space, it’s also happening outside of that space. Everybody is facing the same constraints that you hear around trying to get connected to the grid. The timelines get longer, the upfront capital commitments get stronger and stronger and stronger. As a result, it doesn’t matter whether you’re a commercial or industrial or industrial application, think remote mining or something in oil and gas or whatever the case might be, or a data center, you’re facing those same constraints and as a result they’re having the same conversations with, with lpi. And so we remain focused on all of those opportunities. If you looked at our sales pipeline, the largest share of that remains data centers. But I absolutely expect that we are going to be doing work for commercial and industrial opportunities as well, just given where we are in conversations with them at this point in time. So I think you’re going to see our contractual nature as it plays out represent a good cross section of business that while we’re going to be, while we’re going to have a large percentage of our assets dedicated to data centers, we’re absolutely going to be having some megawatts put to work outside of that space.
Michael Stock (Chief Financial Officer)
Yeah. And Scott, I just would add a little color on that side of the world. You were right in sort of a subpart of your question. In this time when generation is limited, our focus is definitely on longer term contracts. Right. That is also the key part in both sectors know whether it be data centers or the cni, industrial, you know, mining, critical minerals, etc, of the world. So it’s focusing on that, you know, not on the, not on the short term. These are long term build, own, operate contracts 10 to 20 years in duration. So that’s, that’s, that’s where the focus is.
Scott Gruber (Equity Analyst at Citigroup)
Great. I think that was important clarification. I appreciate it. I’ll turn it back. Thank you.
OPERATOR
The next question comes from arun Jayaram with JPMorgan. Please go ahead.
arun Jayaram (Equity Analyst at JPMorgan)
Good morning gentlemen. Ron, you.
Ron Gusick (Chief Executive Officer)
Good morning.
arun Jayaram (Equity Analyst at JPMorgan)
Yeah, good morning. Ron, you discussed in your prepared remarks some trends towards perhaps the disintermediation of the developers and you’re having more direct interaction with the hyperscalers. Could you talk about that trend and could that be a favorable trend for Liberty, Particularly how you’ve commented how there’s been a move towards more Fully integrated solutions. Yeah, that’s a great question. And it certainly is a very, very important trend. Of course, if you look at the landscape, there’s a huge number of land opportunities being developed. That’s not where the challenge lies in this world. So lots of potential sites. It’s ultimately up to the hyperscaler to evaluate those sites and find the ones that meet all of the criteria that they are looking at to ultimately build and operate a data center. And we can work very closely with them, alongside of them to help work through that checklist and understand the sites that represent the best possible opportunity going forward. That checklist is a long one. We’ve talked about that in the past. But you think about things like access to gas, community engagement, surface access rights, subsurface access rights, the list goes on and on and on. And the hyperscalers have recognized that that list is a complex one and that they have choice in land. What they want is a great partner on the power generation side of things that can help them navigate things like the community engagement, the air permitting, the gas access, and the things that LPI has worked very, very hard to bring to the table. And so what we found over the last little while is that while we initially started engaging with the developers that were effectively a bit of an intermediary between us and the hyperscalers, we’ve seen a lot more interest in a direct conversation there. And now our conversations at LPI tend to be directly with the hyperscalers, evaluating a range of land opportunities, recognizing that not all of those will get across the finish line, but helping them to high grade those and then standing alongside them as a partner to bring all of the skills and capabilities that we have to the table.
Michael Stock (Chief Financial Officer)
Yeah, I’d sort of characterize it as we want to become, if we go back, I’m showing my age, the intel inside. Really what the difference here is you’ve got the land developers and you’ve got the land opportunities. You’ve got the data center developers who are going vertical and building the buildings. Ultimately, it’s all getting paid for by the hyperscalers. And we are the key element in there. And so being involved with all three of those stakeholders at the table is the key part. And now we’re more directly involved with the hyperscalers because multiple vertical developers are coming to the hyperscalers and they’re going, okay, Liberty is our power solution. They’re now comfortable with it. Land developers are going to the developers and going, say, I’ve got 1,000 acres. Liberty can be our power on this land. Both the vertical developers and the hyperscalers are comfortable with that. So think about it that way. And that’s how the conversations have kind of moved over the last three months or so.
arun Jayaram (Equity Analyst at JPMorgan)
Great. And my follow up is just in completions. On the last call you mentioned how you’re adding kind of three to four kind of digifleets in calendar 2026. I wanted to see if those were planned to be incremental units or replacement units. And just thoughts on, you know, obviously you guys have been pretty busy in frac for some time. Do your agreements with your dedicated customers provide for openers where you can start to move pricing, particularly on some of those large, more dedicated agreements? All right, I’ll take the first part of that First. As we think about digiprime, I would say that as we went into the year, it was fully our anticipation that those pumps, that equipment would be replacement equipment. We are working hard to transition away from the last of our diesel equipment. I think it’s sub 10% of what we have left operating in the field. And so it was our expectation we would have retired the last of that and replaced that with digiprime, making our entire fleet dual fuel or better going forward. We do have optionality there. However, to the extent the right opportunity presented itself, and that opportunity would have to be the right combination of price, margin and really duration outlook on that work before we would consider turning that equipment into a new fleet, hiring the people to support that and going forward with that idea. But we do retain that flexibility. And so at this point in time, I would say we continue to watch the market, we’ll see how the broader market chooses to move forward given the dynamics that are at play today. And to the extent there is support for that, we would consider making that, that choice to add a fleet rather than make it all replacement. As far as pricing going forward, of course we do operate typically on a year to year arrangement. But that said, I think we work hard to maintain an open conversation with all of our customers. That’s critical in a partnership. It was critical on the way down. As the market evolved, our customers would come to us and, and recognizing where the market had gotten to ask for a pricing adjustment that reflected that. We don’t view that as any different on the way up. It’s reasonable for us in times like this where their economics have moved meaningfully, the price of WTI has climbed significantly to go back and have that conversation again in the other direction. So while we do have some that have very fixed Definitions around how that pricing evolves. For the most part, that is an open conversation with our customers that works both on the way down and again on the way back up. Great. Thanks gentlemen. Of course.
Steven Gianjaro
The next question comes from Steven Gianjaro with Stifeld. Please go ahead. Thanks. Good morning everybody.
Ron Gusick (Chief Executive Officer)
Morning, Stephen. I think following up on the prior question a little bit, when you think about the ARB between diesel and gas burning assets, what does the supply demand look like for non diesel assets in the market right now and how do you think that sort of tightness plays out? I think what I was getting at and I appreciate the answer you just gave Ron, but when we think about if you were us, when would you start to expect the pricing impact to show up on the income statement?
Steven Gianjaro
I would say meaningfully in Q3 is the right way to think about it. We’ll start to feel maybe very modest impacts this quarter. But in reality, given time to have those conversations and then to work through pads and get to a place where we can enact that step in pricing, really expect that to start to show up in Q3. I would say to the first part of your question that if there is capacity that has some ability to consume natural gas, it’s in high demand today. You know, we’ve talked in the in calls gone past about that delta between the cost of running a fleet on diesel fuel versus the cost of running a fleet on natural gas. And that ebbs and flows of course depending on exactly where diesel prices are. But anybody who’s driving by a gas station today knows where the price of diesel has gone to of late and it is highly elevated. That pushes that spread back up to probably something north of $20 million annualized in potential fuel savings going from 100% diesel to 100% natural gas. And so as you can imagine right now dual fuel or 100% gas is in high demand. Fuel is effectively a pass through on a location. That’s a cost that the E and P absorbs directly. And so they’re doing all they can to mitigate that. I talked about in our, in my opening remarks, our focus on even maximizing the substitution on those fleets about eking out that incremental couple of percent of gas substitution because that’s meaningful to our customers today and they see that as critical to helping out their economics over the long term. So lots of focus on that particular area and certainly a huge amount of interest in gas fired equipment.
Ron Gusick (Chief Executive Officer)
Thanks. And then on the power gen side we get a lot of questions about this And I just curious if you could clarify when we think about the arrangement with Vantage and kind of what it means for you, can you talk about how we should think about that impacting power contracts and then what exactly does the contract pay you? Starting with the reservation fee. How does that work exactly?
Michael Stock (Chief Financial Officer)
Yeah, so we’ve released some details on it, but let me give you the general overview. We have committed to them 400 megawatts starting in the beginning of 2020 that’s available for them to put on any project. So think about this as saying, okay, this is a developer, we’re working with them very, very closely on nine or 10 different projects, looking at gas, looking at land availability, working specific, you know, kind of air permits on a specific project, et cetera that we’re going to be developing. And they can do that very much so because as they choose, wanted to see which, which, you know, as they’re going to put pitch to the hyperscaler and they choose a piece of land, they know that they have this early power, they can commit now that 400 megawatts, right, which is not under an EISA yet because that’ll be signed with the Hyperscaler. They know that they could do that in one single site, you know, and that would be that’s landed in the US So therefore that would be, you know, started to go in service late 27, early 28. So they can develop that site with surety that they have that early power or they could develop two sites, split it in two and have early power on both those sites without having to commit to us for any more power. Right now in exchange for that we have a payment stream that as I said in our press release, mirrors the equivalent of an ESA over a five year period for that portion of the capital expenditures that the generation relates to. So what we’ve committed to on our balance sheet versus the full build out and as you know, kind of Generation is approximately 55, 60% of the full power plant in general. Right. So ultimately that’s what they’ve committed to. So it gives them surety to be able to go out and do this development track. And that is the focus of that. So it’s a long term development partnership and those discussions are ongoing with others as well. So it’s a great way to deeply embed. So we become a little bit part of their internal power group looking at gas, looking at gas availability, working on land sites. They want to evaluate seeing which ones work, which ones don’t, what the power costs would be there, what that long Term view would be. So that’s how that agreement works and that’s really how you want to develop infrastructure across the board in the future. Because there are so many moving parts, whether it’s air permits, whether it’s local engagement, whether it’s the fiber access, whether it’s sort of what’s happening specifically in that area of generation, if you end up wanting to have an interconnection, et cetera. So a lot of moving parts, right. So that’s the right way to do it, to have these deep long term partnerships to develop infrastructure. And I think you’ve seen in some ways, and I think people will realize it mirrors exactly the way that we built our completions company, right? It was these deep long term relationships. Our biggest customers are our oldest customers. We were completely engaged with them in their underground engineering. Even though, you know, that was service we gave for free. You know, we had sort of like this, you know, the best database in the world of everything that happened under the ground. And we were deeply engaged in their completions design allowing them to get to what lane ViAs. Our VP of Technology, we always called the Happy Valley. The lowest cost to bring a barrel of oil to the ground and the lowest net cost because ultimately if the oil price goes up like now and sand prices are low, it’s good value to pump more sand. When sand prices are high, you pump less sand because it’s that net. So working with that same partnership mentality in the power business is what we’re doing.
Steven Gianjaro
That’s great color, Michael. Thank you.
Josh Silverstein
The next question comes from Josh Silverstein with ubs. Please go ahead. Thanks. Good morning guys. First question on the power side for me. Given the kind of six to nine month time duration to deploy capacity, I wanted to see if you’ve already taken receipt of some of this inbound to go and support the Vantage 400 megawatts for next year. I know there’s some technology and things that you guys have to do in house before deploying it. So just wanted to see what sort of milestones you could talk about along the way there. We certainly are taking delivery of power generation equipment already. It started arriving late last year and has been arriving through this year. We’re working on packaging of that right now. As Michael has alluded to in some of his comments, these deployments tend to happen in larger blocks, hundreds of megawatts at a time in some cases. And so it means that we ultimately build up a bit of a backlog of assets and then they will be deployed in a Relatively large tranche of equipment specific to the Vantage assets. Those are assets that are arriving in 27 that are allocated to them. So this generation that we’re taking delivery of today is allocated to other opportunities in our sales pipeline. Thanks for that. And then on the frac side, there’s been a lot of uptick in discussions about increased energy security globally. Now you guys do have some frac equipment outside the U.S. i’m curious if you’re starting to have discussions with any national oil companies or any other countries or US companies with international assets about bringing some of the frac equipment you guys have here abroad. We certainly have. We continue to get inbound calls with an ask for liberty to go and be a presence elsewhere in the world. Of course we took the step in Australia and excited about the opportunities there. I think we’ll have first gas celebration there a little bit later this summer, maybe August, I think is the plan for that pipeline to get connected. And of course you’ve seen a lot of momentum in that area. I think Australia very well situated to serve the growing LNG needs in Asia. But that’s certainly not the only place. Of course there’s lots of excitement elsewhere in the world. We continue to field inbounds to be a partner in that development elsewhere in the world. And we look at each and every one of those opportunities, we’ll continue to evaluate them on a case by case basis. And when we see an opportunity that we think makes good sense, a place where we can add real value and be a great part partner to either a North American EP or a national oil company elsewhere, we’re prepared to take that step. What I would say is that at this point in time we just, we don’t have spare equipment. And so it’s always been a challenge for us to say yes to that when we’re still working hard to meet the needs of our customers here in North America. Maybe one other thing to add on top of that beyond just the oil and gas opportunities is the enhanced geothermal. Of course, we’re a partner with Fervo here. That idea of taking directional drilling, horizontal wells and hydraulic fracturing and advancing geothermal is also of interest around the world. Lots of folks evaluating their energy stack and opportunities to have that grow. And that’s a piece of the puzzle as well. So we’ve seen some inbounds in that area as well. Thanks for the update.
Derek Potheiser
The next question comes from Derek Potheiser with Piper Sandler. Please go ahead, Derek. Hey, good morning guys.
Ron Gusick (Chief Executive Officer)
Maybe a little bit of a bigger Picture question on the frac side. I know Ron, you’ve discussed a lot about how we’ve underinvested and we’ve been in this maintenance mode or below maintenance mode for you as frac fundamentals. But in the name of energy security, if we do get this call on short cycle barrels out of US Shale, how should we think about the tightening frac fundamentals over the next one or two years if we actually want to flip back to more of a growth or stay at this plateau that we’ve reached at and what could it mean for availability of equipment? And maybe further conversations as we start to continue to high grade the equipment base just because you said there’s really not much available supply out there in the market. Just trying to think further down the line in 27 and beyond about what the frac supply and demand could look like. So maybe just some thoughts around that. I think a very interesting question to look at. I would suggest it would be a market that would tighten very, very rapidly. There have been some folks in the industry who’ve done their best to count available capacity that could come back to the table. And of course that’s not next generation capacity, that’s older diesel equipment that tends to be against the fence. But that is just a handful of, we’ll call it conventional fleets, fleets that could do zipper frac work. Most of the work we’re doing today is simo frac work. And so you probably cut that number even in half from that. I could anticipate that getting soaked up very, very quickly. There is not, as I think you’ve heard in the last number of calls from folks in the industry, a huge commitment to capex in this space. There is not a pile of new equipment being built at this point in time. And as a result you’re talking about a meaningful amount of lead time for the industry to be able to react to that call on additional equipment probably takes nine months or something like that to to get a fleet built and then staffed and stood up and ready to go. So there is a scenario where we start to see a very, very tight market here in the coming months and ultimately years. Just given the lead time that’s going to be required to react to that. We’ll see that first on the drilling side of things. Ultimately we get a little bit of lag on that, so we get a bit of warning. But I think while it might not be the ramp out of COVID it certainly could get us back to some very, very strong economics like that.
Derek Potheiser
That makes sense. I Appreciate that. I guess flipping to the power side of things, I know in your recent deck you highlighted that 330 megawatt data center expansion was canceled. I think you’re still working with that developer, but maybe just an update around that kind of what happened there, how we should think about those megawatts moving forward. You totally appreciate the extended timelines withstanding these power products up. You just spoke about the Vantage megawatts being deployed, but how should we think about that other contract you announced and then just future contracts, future deployments outside
Michael Stock (Chief Financial Officer)
of the Vantage one? Yeah, that was working with one specific hyperscaler developer who was working with a specific hyperscaler on a campus expansion. And we were deep in the heart of contractual negotiations on both the ELSA and the technical side of the world. Ultimately, the Hyperscaler decided to delay that campus expansion and in that reservation agreement with the developer, the way those work is they have quickly ratcheting cancellation fees to have us take megawatts off the market, which is like guaranteed off the market. Potentially. We have this kind of ratcheting reservation fee and it changes, you know, sort of goes up significantly each month. And so they paid a multibillion dollar cancellation fee for that. But we’re still working with that developer and on that campus, I think long term it’ll probably go. But those that 330megawatts have been associated with a different opportunity that’ll execute in the same time frame.
Derek Potheiser
Great. Appreciate all the color. I’ll turn it back.
Keith Mackey
The next question comes from Keith Mackey with RBC Capital Markets. Please go ahead. Hey, good morning. Maybe if we could just stay on the power side for a moment. Can you just speak to the pipeline of opportunities that you’re seeing? I’m guessing it’s maybe a little bit more weighted towards the data center space, but are you seeing an acceleration of these opportunities or things slowing down a little bit? And are there any opportunities you might be closer to the finish line than others for some of the incremental capacity that you’ve got coming?
Ron Gusick (Chief Executive Officer)
Yeah, I would say certainly accelerating urgency continues to strengthen in that space. A recognition that behind the meter, power just continues to get better and better and better. We continue to be served well by the challenges that people face on the grid and really the additional commercial constraints that are being added to those. So our sales pipeline is getting larger, larger and larger and larger. We’ve added even in the last couple of weeks, a number of campuses that have the potential to be gigawatt scale or larger to our sales pipeline. As you might expect they’re all in different states of progress towards completion. We have some of those that are targeting power generation by 2027, some of those out towards 2028, and we’re working closely alongside of them to meet those timelines. I think at this point in time we remain comfortable that we have the ability, given that we’ve leaned in on this, to meet those timelines. But I would say that our sales pipeline is still many fold larger than what we’re going to be able to deploy. We will not be able to take all of these campuses across the finish line. And so we’ll ultimately end up aligned with a number of key partners. And to the very early part of your question, not all in the data center space. I mean if you looked at the sales pipeline, the largest percentage of that will be focused at data center campuses. But there are in our sales pipeline, and I think ideally probably pretty close to the finish line, some opportunities that are outside of that in the commercial and industrial space that we will execute on as well.
Keith Mackey
Okay, understood. And just following up on the frac technology side, specifically the variable speed to G prime pump, I think one of the solutions that companies have been working with to solve the single speed issue is just mixing a 100% gas recip engine with some tier 2 or tier 4 dual fuel equipment. So what is different about what you’re doing and how does having a variable speed 100% gas pump provide an advantage
Ron Gusick (Chief Executive Officer)
for you going forward? Well, effectively it ultimately removes the need to have that diesel, that dual fuel equipment on location at all. It was a challenge in the early days as we as we really pioneered this path towards direct drive natural gas equipment was overcoming that constant speed situation and really the limiter of just a change in gear to allow a change in rate. But now first of all with Cummins and subsequently with mtu, we will have a variable speed natural gas fleet. And that means that for all intents and purposes, we have a path towards 100% natural gas on location and we’ll remove the need for diesel entirely on that site. That’s the long term goal, is to get to that place where we’re running on 100% clean burning natural gas. It offers obviously huge economic benefits, but it certainly comes with an emissions benefit as well that our E and P customers value tremendously in their conversations as they think about working around communities and things like that. So there’s a huge amount of benefit there and we’re excited to be on that path to a place where for those fleets, digifocused we will not need any dual fuel equipment.
Keith Mackey
Understood. Appreciate the comments.
Saurabh Pant
The next question comes from Saurabh Pant with Bank of America. Please go ahead. Hi, Ron. Mike, good morning.
Ron Gusick (Chief Executive Officer)
Good morning.
Saurabh Pant
Ron, you talked about how quickly the market can tighten and I heard you talk about pricing headwind and pricing recovery on the same call. Right. So that answers the question, I guess to some extent how quickly the market can tighten if I just, just the nature of the market, I guess right in both directions. But if I just focus on the very near term, just to calibrate numbers a little bit. Ron, Mike, maybe you want to step in is as we think about the second quarter. Ron, correct me if I heard you wrong, right, but you talked about potentially there’s a little bit of pricing upside in 2Q as well, more in second half, but maybe a little bit in 2Q. And then seasonality helps you on the utilization side. Granted you’re coming off of a record high in the first quarter, but how should we think about 2Q? Maybe just some guideposts around how to think about what to expect for EBITDA in 2Q.
Michael Stock (Chief Financial Officer)
Yeah, I mean I thought the easiest way to think about it is yeah, there’ll be a very small amount of pricing. So I’d say high single digits, kind of up on the revenue side, but mostly activity like,
Saurabh Pant
okay, okay, I got it right. And then obviously utilization is better so you get some benefit from that. Okay, okay, that makes sense. And then the other one for me, right. I’m just thinking bigger picture on the power side of things, Iran, like you described in your remarks on site, power is a complex operational symphony, Right. I think that’s a good way to put it. And you are doing a lot of things at your end, right? Integrated packaging, you putting together a micro grid testing facility. But a lot of things are still outside of your control. Right. And like Derek pointed out, a data center campus expansion gets delayed, you’ve got a preliminary esa, it could be terminated. And then again you go back to the drawing board, right. But how do you think about the risk from a timing standpoint?
Ron Gusick (Chief Executive Officer)
Mike. Right. As you, as you are in discussions on future contracts, right. Just, just, just given the timing of these things, right. They’re more likely to shift to the right than the left. It certainly is an accurate statement to say that not all of those factors are in our control. There are variables that are at play on any given site that remain beyond what we’re focused on. And so yes, we have to be cognizant of those variables. I Would say that as a partner to the hyperscalers, we have worked hard to understand many of the variables. And I think we can be a value add in a lot of those cases. Not for everything, but for a lot of them. Just given the experience we bring from the, from the oil and gas side of the world. We’ve been through a lot of this stuff that hyperscalers are navigating today. Emissions permitting, community engagement, and all of those things. That stuff we know and understand. The hyperscalers haven’t been in that space before. They haven’t had to navigate. Navigate the world of community engagement to understand what it means to get up in front of a community town hall and have them realize the benefit of having a data center, or in our case, an oil and gas operation present in the community and then to understand all that we’re doing to make that a benefit, not a detractor from the area. But we, of course, have an immense amount of experience there. And I think it’s one of the true benefits of now being engaged directly with the hyperscalers is we’re able to. To stand beside them, help them work through this checklist of opportunities. We get a little bit clearer line of sight into those things, but we can aid where possible. I would say that recognizing that risk, we have a sales pipeline that’s meaningfully larger than the amount of generation that we are going to bring to the table. And that’s true because we understand that not all of the sites will get across the finish line. Michael noted that we’re working with Vantage on quite a number of sites that they are trying to move forward. Not all of those sites will get to the finish line, but a handful of them will. And the same is true with the other parties that we’re working with. And so we remain very, very confident in our ability to deploy that 3 gigawatts by and have that working in 2029. I don’t think sitting here today, Michael and I see any concerns with that at all. There remains an incredible sense of urgency around getting AI up and running at larger scale. You continue to hear the success stories from businesses. Every time a business takes something that was a pilot project and scales that up to full deployment across their company, there’s no benefit of scale there. The amount of compute required grows linearly with the number of people that are putting that technology to use. And the hyperscalers are seeing that firsthand. And as a result, I remain confident that while we will have some of these sites slipped to the right, our ability to put 3 gigawatts to work in the next couple of years is. I think we remain very confident in that.
Saurabh Pant
No, that makes a ton of sense, Ron. I guess the fact that you’re working directly with the hyperscalers is only going to help, right? Just to iron out the pieces.
Ron Gusick (Chief Executive Officer)
It certainly is, yeah. Nice to be right at the table with them as well. As Michael alluded to, there’s a number of parties at the table and critical to be at the having a conversation with each and every one of them.
Saurabh Pant
Right? No, that’s fantastic. Okay Ron, thank you. Thanks for the comments. I’ll turn it back.
Ron Gusick (Chief Executive Officer)
Thanks so much. Saurabh.
Dan Cutts
The next question comes from Dan Cutts with Morgan Stanley. Please go ahead. Hey, thanks. Good morning.
Ron Gusick (Chief Executive Officer)
Morning Dan.
Michael Stock (Chief Financial Officer)
So Michael, I think I caught that you said maybe QQ revenue could be up high single digits sequentially, so correct me if that’s wrong and then wondering if you guys could share anything on what kind of incremental margins you could see on that revenue increase. If there’s any factors we should be thinking through that kind of could support above or below normal incrementals into the second quarter. I guess one example could be that the 1Q in winter storm impact I could see that maybe driving some above normal incrementals into the second quarter. But yeah, just anything you could help us with there as we’re thinking through what margins could look like this quarter? No, I just said you know, high single digit on the top line normal incrementals, you know through to the people. The EBITDA sideline for activity activity incrementals is probably the best way to look at it for now. That’s kind of the, the view would give Perfect. Super helpful and then maybe if I could ask on the two convertible notes offerings, just wondering if you could share any incremental color around the strategy there and the timing. I guess you had the first offering in early February and then relatively shortly after that in late March for the second offering. Was that just opportunistic? I’ve heard that the convertible market especially paired with the cap calls is actually a pretty inexpensive and kind of favorable source of capital at this time. So wondering if that was just opportunistic or if anything changed in kind of the power funding requirements or timelines there that catalyzed the second notes offering. Thanks. No, it was opportunistic. I mean I think you’ve got to think about the fact that we’ve got a significant amount of, you know, forward payments that we’re making on generation that will flip into into project finance and then that that money will recycle onto the corporate balance sheet. And that’s what we’re using the converts for. The first convert was incredibly successful, kind of eight times oversubscribed, you know, zero percent coupon and we’re up, you know, we bought a cap call so you know, sort of we don’t get any dilution, you know until we get to a significant high share price. And really we’re at probably a net between the two calls that slightly below even with the cap call costs less than 3% net cost of capital for that 1.2 billion. So it’s an incredibly cost effective way of raising money. And the second one, obviously as we looked at the world economic situation with the straits of Hormuz being shut, you’ve got to be aware of the fact that there can be knock on effects of these global this war and the potential to affect the financial markets. And making sure that we had the capital available to execute on our growth plans was key. The financial market was completely open. The second follow on was about the same on the oversubscription and again a 0% effective interest rate and so just a great way of raising capital to allow us to grow our power business. Great, that’s all really helpful. Thank you both. I’ll turn it back.
Mark Bianchi
The next question comes from Mark Bianchi with Cowan. Please go ahead. Hey, thanks.
Michael Stock (Chief Financial Officer)
Thanks for squeezing me in. I’ll just ask Wanda. In the interest of time, the Capex I think was originally guided to a billion dollars. Michael, I know you mentioned there’s this $300 million milestone payment in second quarter or early third but how are you thinking about that CAPEX guide at this point? Do you see a chance for being above or below and can you maybe remind us of the components? Yeah, as we look forward it really hasn’t changed at the moment. We’ll probably revisit that in July as we look at the power business and where things are going. But we’re still on target for about where we were on that capex. Kind of about a quarter of a billion of that 250 million was on the completion side of it. And as Ron alluded to, if there’s an opportunity, if that market strengthens significantly, maybe that’ll go up here. If we are keeping making one of the DIGI fleets a new fleet and we’re keeping some of the older equipment running. But at the moment no change to our guidance.
Mark Bianchi
Got it, Got it. Okay, thank you so much. I’ll turn it Back.
John Daniel
The next question comes from John Daniel with Daniel Energy Partners. Please go ahead. Hey, thanks for having me and keeping with Mark’s comment, I’ll just keep this to one question. But Ron, for a dedicated fleet which is either dual fuel or 100% gas powered, is pricing somewhat formulaic and that it’s tied to diesel price such that if you see a rapid escalation in diesel, you get an immediate upward trigger in the price?
Ron Gusick (Chief Executive Officer)
And conversely, would there be a trigger on the downside too? I would say that it’s not necessarily formulaic, John. Of course we recognize the opportunity there, as do our customers recognize the value that comes with that technology. And so that is certainly part of the conversation. But as in all of our relationships with our customers, we typically find that formulas aren’t a great answer. There will always come a time when the formula doesn’t quite solve to the right outcome and so inevitably it ends up becoming a conversation. So I would say that for us, while that certainly informs the conversations that the sales team is having with our customers to deploy that technology or to recognize the value of that technology, it’s not the only piece of the conversation.
John Daniel
Fair enough. And, well, I’m going to squeeze one more. I lied to you. I apologize. But when you, when you see diesel, you know, sorry about it. But diesel prices, as you guys know, they’re up like 50% or something. I don’t know what the exact math is over the last couple months, but it’s a lot. I mean, that would seemingly imply a very material price uplift for your higher quality fleets. I mean, I know you can’t quantify and don’t want to quantify, but is that a wrong assumption?
Ron Gusick (Chief Executive Officer)
It’s not, John, but what I would say is that those fleets were also a little less or a little more immune to the pricing degradation that’s happened over the last number of years. As we put new technology to work, we have expectations around the return on that invested capital with our customers and they recognize the value of that. And so we probably didn’t see the same level of erosion in pricing there that we might have in the other technology. And as a result, despite diesel prices jumping meaningfully, we’re not going to recoup the entire value of that jump in opportunity set.
John Daniel
Fair enough. Thank you for taking my questions. Thanks, John.
Eddie Kim
The next question comes from Eddie Kim with Barclays. Please go ahead. Hi, good morning.
Ron Gusick (Chief Executive Officer)
Just one question for me. Could you remind us of the 3 gigawatt target by 2029? How much of that has been ordered to date and what’s left to be ordered. And in terms of what’s left to be ordered, do you anticipate placing those orders before the end of this year, or will some of that fall into 2027? I’d imagine there might be some concerns about the cost of equipment getting more expensive, so there might be a preference to accelerate those orders as quickly as possible.
Eddie Kim
Any thoughts there?
Michael Stock (Chief Financial Officer)
Yeah, I mean, as you know, we started ordering in 26, and the vast majority of it, you know, is either, you know, is either ordered or in contractual negotiations at the moment where we’re just kind of finalizing the eyes and dotting the T’s for that 3 gigawatts. So it’s, you know, that’s all going to be kind of in flight this year.
Eddie Kim
Okay. Okay, Understood. Good. Thank you.
OPERATOR
I will now turn it back to Ron for closing remarks.
Ron Gusick (Chief Executive Officer)
It is unfortunate that it takes a war in the Middle east to give the energy security conversation the attention it deserves. For years, many of the lucky 1 billion have taken energy for granted, enacting policy decisions that showed a complete disregard for the importance of access to abundant, affordable, reliable energy. Now, as the realities of a global energy supply disruption set in, I wonder if there are people looking back and asking, what have we done? Make no mistake, this is not just about high gasoline prices and expensive airplane tickets. Fertilizer prices and even just availability of that product are forcing crop switching or under application, threatening harvest yields by an estimated 10 to 15% this year. Cold chains, the shipment of refrigerated goods are breaking down in Asia due to lack of diesel fuel, meaning people will do without access to groceries. Factories are being forced to run at 50% of capacity due to lack of energy supply. Those using diesel generation for backup, assuming they can get diesel, have seen their overall operating costs climb by as much as 30%. The implications are far reaching. We are fortunate here in the United States, with the exception of a few states, we are insulated from the worst of the impacts. The shale revolution has ensured access to abundant quantities of oil and natural gas, ensuring we can not only look after our own, but also play a meaningful role in supporting others around the world. We would be in a very different situation were it not for the hard work, dedication and ingenuity of the people in the oil and gas industry. Not all countries are in the same position. Some have no choice. By virtue of not being blessed with abundant natural resources, they rely heavily on partners like the United States and Canada for access to energy they so desperately need to fuel their economies. Some did have a choice, however, and it is with them that I am most disappointed and frustrated. Their policy decisions have meant that critical energy resources are not being developed or have been shut in prematurely. These decisions were made without meaningful, if any, consideration for the broader global implications, without thought for those who rely on energy imports to either enable their current way of life or, even more importantly, provide the much needed energy to plot a path out of poverty and towards a life like the one each of us leads here. I can only hope that this is a defining moment for the course of energy policy going forward forward and that there is an awakening to the truly devastating impacts of misguided decisions focused on net zero policies rather than energy abundance. And that we see a pivot towards support for development of oil and gas resources with the goal of ensuring no one has to go without thank you again for joining us on the call today. Have a great rest of your day.
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