Greetings, welcome to the Atlas Energy Solutions First Quarter 2023 F inancial and Operational Results Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kyle Turlington, Vice President of Investor Relations. Thank you, Kyle. You may begin. Hello, and welcome everyone to the Atlas Energy Solutions Conference Call and Webcast for the First Quarter of 2023. With us today are Bud Brigham, Chairman and Chief Executive Officer, and John Turner, President and CFO. Both Bud and John will be sharing some comments after which we will open the call up for Q&A. Before we begin our prepared remarks, I would like to remind everyone that this call will include forward-looking statements as defined under the U.S. securities laws. Such statements are based on the current information and management's expectations as of this statement and are not guarantees of future performance. Forward-looking statements involve certain risks, uncertainties, and assumptions that are difficult to predict. As such, our actual outcomes and results could differ materially. You can learn more about these risks in our registration statements on Form S-1 filed with the U.S. Securities and Exchange Commission on January 31st, 2023, in connection with our initial public offering, our quarterly report on Form 10-Q and our other SEC filings. You should not place undue reliance on forward-looking statements, and we undertake no obligation to publicly update these forward-looking statements. We will also make reference to certain non-GAAP financial measures such as adjusted EBITDA, adjusted free cash flow, and other operating metrics and statistics. You will find the GAAP reconciliation comments and calculations in yesterday's press release. With that said, I will now turn the call over to Bud Brigham. Thanks, Kyle. Hello, welcome to the Atlas Energy Solutions Earnings Call and Webcast for the First Quarter of 2023. This is our very first earnings call as a public company, I want to welcome our new investors. Thank you for believing in us and supporting our mission. I also want to congratulate our early existing investors. What you have helped us create is very special, we're only just beginning. I would like to start this call with some preliminary remarks about who we are and the Atlas mission before getting into the normal course, operational and financial commentary. I've said it before that I really did not expect to take a third company public. We're here because this is a very special company with a lot of opportunity ahead of it. We're excited to be taking the next major steps forward, in my view, to accelerate the Permian's maturation from a world-class oil field to an even more differentiated world-class energy manufacturing center. The oil field in general, and the Permian particularly, has been evolving. I believe that Atlas is uniquely positioned, given, one, that we have the scale that is necessary and sustainable to match the growing scale of Permian operators. Two, our E&P experience, including with infrastructure and right of ways, and three, our track record in the basin to deliver the next constructive disruption to accelerate the Permian's transformation. The prior constructive disruption, sourcing local sand, was extremely beneficial to the Permian and further differentiated it relative to other basins. By securing what I call the Ghawar of sand reserves and building state-of-the-art plants with redundancy, Atlas emerged from that disruption in an advantaged position as a premier proppant producer in the Permian. In addition, Atlas has delivered industry-leading environmental benefits by reducing energy consumption, emissions, and the aerial footprint of our mining operations, benefiting from our giant open dune deposits and our unique dredging operations with more to come. Atlas has been sold out of proppant, and our customers continue to sign new contracts of increasing term. We think that excitement over the Dune Express and its societal and environmental benefits are part of this. The market, as evidenced by the demand for our product, has been telling us it needs more Atlas proppant. Our expansion project has been underway since last year. It is on time and on budget. We expect it to grow our production capacity by roughly 50% as we exit the year. With all that said about our proppant production, Atlas has commenced the next constructive disruption in logistics and delivery systems. As everyone in the region knows all too well, the Permian road infrastructure and communities are intensely pressured and negatively impacted by heavy hauling, particularly of mission-critical proppant on our commercial roadways, which are shared with the residents and workers in the community. Given our differentiated scale of production of this mission-critical element that must be delivered to every Permian horizontal well, as well as our E&P and infrastructure experience, Atlas is uniquely positioned to deliver a step change advancement in delivery systems, thereby enhancing reliability, dependability, and efficiencies with major environmental and societal benefits. These initiatives are very much underway. They will enable Atlas to reduce emissions and save lives while making the Permian Basin a better place to live and work. I call this sustainable, environmental, and social progress, or SESP. It's also what I term the harmony of capitalism. It's the reason our country enjoys among the cleanest and safest air and water of any major country. By responsibly focusing on our fiduciary obligation to create value for shareholders, all the legitimate stakeholders, including our employees, our communities, and the environment, also benefit. It's virtuous and it's sustainable, compounding constructively for all our stakeholders. As a result of our intense focus on our fiduciary obligation to our shareholders, I would put our company's environmental and societal accomplishments up against any peer. As you can see in our presentation, our innovative and unique logistics platform has been delivering proppant from our state-of-the-art production facilities, utilizing our fit-for-purpose logistics assets all the way to the blender. This asset base continues to grow as deliveries of equipment progress and as we obtain new logistics work around the basin. We've successfully completed jobs with payloads close to 100 tons per truck, which is roughly 4x the industry standard, and which illustrates the potential of our logistics offering to drive efficiencies for our customers even prior to the Dune Express in-service date. Of course, this is being implemented to ultimately integrate with our Dune Express, which will compound to further advance logistics in the Permian. The Dune Express was the use of proceeds in our offering. It's an innovative and state-of-the-art 42-mile conveyor system to transport proppant into the heart of the Permian. Its construction is very much underway. I should also point out that these logistical initiatives, particularly the Dune Express, are very personal to me, given that I grew up in Midland. The current situation in the region is unacceptable. We intend to change it. We estimate that for deliveries fulfilled using the Dune Express, we'll be able to cut out, on average, 70% of the miles driven on public roads as compared to deliveries performed from competitor plants in the Wickett trend. We think that's going to be powerful in terms of avoiding traffic accidents and protecting human lives. Again, the reason we started looking at this project was to drive returns to shareholders. It's such a wonderful thing to deliver high-impact infrastructure that provides major safety benefits to the Permian Basin community. It's also very rewarding for me personally, given that it will be located right there in the community I grew up in. To get into the update on the business and industry, we're pleased with our first quarter results. We remain very bullish about the company's prospects and have an optimistic outlook for the industry. Briefly regarding the outlook for our industry, in my view, the macro headlines, which were created by excessive government spending and associated subsequent monetary disruptions, may mask but does not change the underlying major structural problems that we have with energy. Given the lack of capital invested in energy over the last seven years, I am very concerned about our ability to meet the demand growth that is coming, particularly in the developing world, over the next one, three, and even five or 10 years. In my view, a lot of responsibility and opportunity will fall to the Permian as a premier oil-producing basin in the U.S.. Regarding our performance, we are proud of the operational execution that underpins this quarter for Atlas as the company set new quarterly operational and financial records on sales volumes, sales, adjusted EBITDA, and adjusted free cash flow. The margins generated by this enterprise are better than any company I've been associated with. Our financial metrics, as illustrated in our presentation on slide 13, compare very favorably with the best performers in the oil and gas industry. Atlas has generated meaningful value for its equity holders. Over time, our exceptional margins, cash generation, and growth should be recognized in the market. The company is well capitalized on the heels of our recent IPO. As will be discussed further, we are progressing nicely on the execution of our growth initiatives, including the Kermit facility expansion and construction of the Dune Express. Briefly regarding the dividend, this will be our sixth distribution over the last 20 months. The last four distributions have been $50 million per quarter, and we're distributing $50 million again this quarter. At our current run rate, that's approximately 19% of our adjusted free cash flow of approximately $77 million in the first quarter of 2023. For the time being, this should be considered a variable distribution. During the course of this year and next, we will look forward at our forecasts on a quarterly basis to be sure that we retain plenty of flexibility to fund and complete our growth CapEx projects. The fact that we enjoy such exceptional margins, that we're over 90% contracted this year, and that we expect to be about 80% contracted for 2024 by year-end, should provide us a good deal of flexibility in this regard. If conditions change and our forecast change as well, we can retain more of our free cash flow in subsequent quarters for our higher rate of return growth CapEx projects. During the course of this year and possibly next, our board will be deliberating, developing, and implementing a longer-term dividend policy. We are in a window of substantial CapEx investment with both our current plan expansion and the Dune Express, they will both be completed over the course of the next 18 months to generate a material expansion of our production, revenue, and cash flow capability. We expect, given our strong margins, that in the process of winding down these substantial capital investments, Atlas will become an even more powerful distributing enterprise. With regard to the broader industry outlook, activity levels across the Permian drilling and completions market remained robust during the first quarter, with the Permian adding 33 new rigs year-over-year. The Permian is very important to the global oil supply picture as it contains some of the most economic rock in North America with low oil price breakevens. Importantly today, given the higher oil cut that is exhibited by most Permian wells, the Permian economics are not particularly sensitive to natural gas pricing. That's important to keep in mind for us as we're selling 100% into the Permian. We're not exposed to the negative dynamics affecting service providers with a footprint in the gas basins. In fact, we potentially stand to benefit from the relocation of equipment from gas basins. For every incremental frac crew that relocates from gas basins to the Permian, there is incremental Permian sand demand associated with that crew. That incremental sand increases the total sand demand in the Permian and provides market tailwinds. Regarding the sand market in the Permian, given our highly contracted position, we were not a large participant in the spot market during the first quarter. Our contracting strategy allows us to have stable, consistent, and forecastable pricing. Our expectations for the second quarter average pricing have us landing in the mid to low $40s range for mine gate pricing, with continued light and selective participation in the spot market. We are expecting proppant consumption to continue to increase as long as oil prices remain in the current range, which I view as likely prior to eventually heading higher. We also expect completions efficiencies to continue to drive proppant consumption profile upwards across a range of oil prices as completion cycle times continue to improve with increased simul-frac adoption, which we see as currently only about 10%-15% of the market. This is expected to drive growing demand in future periods. Restating and summarizing on our capital projects, John will cover the numbers, we are progressing nicely on our current facility expansion, which we still expect to come online in Q4 this year on time and on budget. In fact, the new silos for the expansion are going vertical right now. As I mentioned earlier, we officially kicked off the process of building the Dune Express during the last quarter. We broke ground on March 21st. Just a reminder, we have previously secured the necessary right of ways, obtained all required federal and state permitting, and previously secured two anchor contracts to take delivery of sand from the Dune Express. We have ordered more than 50% of the equipment and materials required for the project, which are generally contracted, providing for greater budget visibility. We've also ordered more than 40% of the services related to installation and labor, which again means we're de-risking the project's overall cost by agreeing to pricing with many of our vendors. We've cleared about 15 mi of the route, of which 5 mi has been graded, and we've laid about 15 acres of caliche pads for our transfer stations, laydown yards, and overhead crossings. While we're still early in the construction, all of this activity gives us increased comfort in our planned timeline for commercial in-service, which we anticipate will occur in the fourth quarter of 2024. In summary, I will turn it over to John, we're very pleased with the performance of the company, and we're optimistic in our outlook for the remainder of the year. We view the macro setup as compelling and are extremely excited about our transformational logistical initiatives. We appreciate your support as stockholders, and we're working hard to create value. With that, I'd like to turn the call over to John Turner, our President and Chief Financial Officer, to discuss our financial results in more detail. Thank you, Bud. Today, I'll review our first quarter 2023 operating results and comment on our financial position. We had a strong quarter from a revenue standpoint and generated a quarterly reported adjusted EBITDA of $84 million, representing a strong margin of 55%. As we'll get into, this was an excellent quarter despite elevated plant operating costs, which will moderate going forward for the rest of 2023. In the first quarter of 2023, we set a company record for quarterly sales volumes at 2.8 million tons. This annualizes to a run rate of just over 11 million tons per year. We were highly contracted in the first quarter and remain highly contracted for the remainder of 2023. We expect to renew and to add incremental contract volumes for 2024 and beyond as we move through the year, and expect that as we grow our logistics fleet and get closer to the Dune Express in-service date, that our contract position will continue to grow on the logistics front as well. For the first quarter, we generated record sales of $153 million, representing a 2% sequential increase. On product sales, our volumes grew by approximately 91,000 tons, representing a 3% sequential increase. Mine gate pricing in the first quarter of 2023 was $0.76 per ton higher than it was in the fourth quarter of 2022. For our service sales, which is revenue generated by our logistics business, we saw a sequential decrease of $2.7 million, which was associated with lower than expected freight pricing experienced during the quarter. As a reminder, prior to the start of 2023, our service sales were limited to our asset light, low margin, well site coordination services business. Profit logistics is an area of significant focus, growth and margin potential for us as we build out our fleet and ultimately transition to a logistics model in the Delaware Basin that includes shorter hauls off the Dune Express. Cost of sales, excluding DD&A, decreased by $4.7 million quarter-over-quarter to $63 million. This decrease in COGS was primarily associated with a meaningful reduction in our contract labor and last mile logistics costs. As we continue to transition our dredge mining operations fully in-house, we expect our mining costs to continue to moderate in subsequent quarters as our electric dredges exhibit improving utilization rates over the course of 2023. As electric dredging increases, our mining costs and associated emissions will decrease considerably on a per ton basis. This is a significant component of our overall cost of goods sold. By extension, we see COGS moderated as we move through the year. SG&A expense for the quarter was eight and a half million dollars, representing a sequential increase of 7.6%. This increase was largely associated with an increase in stock and unit-based compensation. Interest expense net came in at $3.4 million for the quarter. Most of this was associated with our term loan, which bears interest at 8.47% and has a 2027 maturity. DD&A expense for the quarter increased to eight and a half million dollars, representing a sequential increase of 9.3%. This increase was due to higher depletion expense associated with higher sales volumes and additional depreciable assets placed in the service as compared to the prior period. We generated net income of $63 million for the first quarter, representing an impressive net income margin of 41%. Given that our IPO occurred in the middle of the quarter, our diluted earnings per share for the first quarter only included income allocated to the Class A shareholders for the last three weeks of the period. You'll see diluted earnings per share of $0.03 presented on our income statement. We generate $63 million in net income for the period as a company. We have 100 million shares outstanding across our Class A and B share classes, which works out to be $0.63 per share. Net cash provided by operating activities for the quarter was $54 million, despite a $22 million increase in accounts receivable. This increase was due to timing. We have seen our accounts receivable balance normalize since the end of the quarter. adjusted EBITDA for the period was $84 million, representing a sequential increase of 12% and adjusted EBITDA margin of 55%. adjusted free cash flow, which we define as adjusted EBITDA less maintenance CapEx, was $77 million, representing a sequential increase of 15% and adjusted free cash flow margin of 50%. During the first quarter, we converted 92% of our adjusted EBITDA to adjusted free cash flow, given our low levels of required maintenance capital expenditures, and we are primarily investing that cash flow back into the business today. Results were strong across the board and are highlighted by our strong margin profile. Capital expenditures for the quarter were $68 million. This includes $61 million spent on growth projects, which is primarily the Kermit expansion, and $7 million spent on maintenance capital projects. We expect our capital spending on growth projects to increase through the year now that the Dune Express project has commenced. We expect capital expenditures for maintenance to grow modestly over the course of the year. Note that as previously mentioned, we are funding the 2023 CapEx associated with the build-out of our logistics fleet with capital leases, so you won't see those expenditures hitting the investing section of our cash flow statement. Instead, you will see us making payments in the financing section of the statement of cash flows over the course of the four-seven year lease terms. As Bud mentioned earlier, we've been distributing $15 million per quarter and are doing so again this quarter. That's a $0.15 per share dividend for our Class A shareholders and a corresponding $0.15 per unit distribution for our Class B unit holders. For now, I'll reiterate this is a variable dividend, and we'll continue to evaluate our plans as we work with the board to develop and communicate a formal return of capital framework. Turning to the balance sheet, we ended the quarter with a cash balance of $353 million. After the IPO, we took steps to de-risk our liquidity position by investing our cash into insured bank accounts and T-bills. As of March 31st, 2023, our total liquidity was $427 million. This was comprised of $353 million in cash and equivalents and $74 million of availability underneath our ABL facility, under which we had no borrowings outstanding. The principal balance of our term loan sits at $141 million, and our current capital lease balance is $27 million. The total amount of debt outstanding is currently $168 million, leaving us in a net cash position of $185 million at the end of the year, which translates to a total debt to latest twelve-month EBITDA multiple of 0.5x. Our outstanding share count at the end of the quarter, inclusive of both our Class A and Class B shares, was 100 million shares. That concludes our prepared remarks for the first quarter of 2023. I will now turn the call back over to the operator to open the line for questions. Thank you. We'll now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please, while we poll for questions. Thank you. Our first question is from Chase Mulvehill with Bank of America. Please proceed with your question. Hey, good morning, everybody. Hope everybody's doing well. Good morning, Chase. Good morning. Just wanted to kick it off with a question, you know, about, you know, Permian frac sand fundamentals. Obviously, you provided some nice color in the presentation, you know, on the supply and the demand side and kind of your outlook there. Can you talk about what you're seeing out in the market today? You know, is pricing momentum continuing to, you know, and out in the market in the Permian, you know, are fundamentals, you know, continuing to tighten? Just kinda your thoughts around the ability to for the market to absorb kinda any incremental capacity that's coming into the market. Yeah. Yeah. Thank you. This is Bud, I'll start with the general comments, these guys may wanna add to it, John or Jeff. You know, as we stated on the call, we are sold out of sand. We've been over 90% contracted, which in our view is a comfortable level of contracting, contracted volumes. Of course, we wanna keep our customers happy. We'd like to have more flexibility to participate in the spot market. It seems pretty steady right now. You know, Jeff was talking about the fact that Halliburton stated in their call that since 2019, fleets have seen a 60% improvement in efficiency. You know, we see demand continues to be up into the right and we're continuing to add contracts and add term on our contracts. John or Jeff, I don't know if y'all wanna add anything to that. Yeah. Yeah, I'll just This is Jeff Allison, Executive Vice President of Sales and Marketing. I'll just add to the fact that with the product offerings that we have historically had, we've with a good product, large inventory, and many, many years of running room with this, coupled with our new offerings on the logistics side, on the trucking, as well as the Dune Express, there's a definite bifurcation here that we're exhibiting within the sand and logistics market. The customers are recognizing that. As a result, we went on a quest last year to strategically target customers that are aligned with our long-term goals. We were very successful with that. As Bud said, over 90% contracted. As we move forward and the tangibility of our Dune Express and our logistics line come on, we're seeing a very large attraction into added contracts with these current customers as well as new contracts. Last year, we brought on contracts three-five years in duration. We still see a strong market and a strong demand for our products and services. Okay. Also, one other, - Great color. Oops, sorry, go ahead. Yeah. I might just add one thing on that is, we were talking about the fact that our current expectations are that as we exit the summer, for 2024 to be about 50% contracted, and we exit the year, we expect to be about 80% contracted in 2024. Hopefully that helps with the visibility. Absolutely. Absolutely. Good color. Appreciate that. Just kinda related follow-up, you know, obviously, it sounds like, you know, things are staying tight on the frac sand side. You've got continued growth on the logistics side. Like, directionally, how should we think about 2 Q EBITDA? You know, should we think about, you know, growing flat? How should we think about, you know, 2 Q directionally versus 1 Q? Yeah. Hey, this is John Turner, Chase. You know, as far as the second quarter EBITDA, look, I mean, we're gonna have similar sales that we did in the first quarter. I think we're gonna have some additional, obviously, logistics sales coming on. You know, our real opportunity there is, and we talked about it and we'll talk about it again or a little bit later, I'm sure someone's gonna ask a question about our OpEx. You know, our operating margins are gonna improve as we continue to improve our operating costs. you know, obviously, we think that, you know, something that's a little north of what we're doing today, you know, as far as, you know, EBITDA goes, but, you know, looking like, looking like it's gonna be a pretty similar quarter. Yeah. I mean, as you know, Chase, the dredging is a unique advantage that we have, and we're in a transition to in-house to our own dredging operations, which is going to drive down our costs. So that'll show up in subsequent quarters and really improve our cost of mining and enhance our margins. Obviously, it's also very environmentally beneficial as well. Yep. All makes sense. I appreciate the color. It was great seeing everybody at the WOTT the other week. Yep. Thanks, Chase. Thank you. Thank you. Our next question is from Derek Podhaizer with Barclays. Please proceed with your question. Hey, good morning, guys. I know you already talked on your prepared remarks about your insulation from the natural gas activity weakness that we're seeing across a lot of these basins, primarily Haynesville, Eagle Ford, MidCon, a little bit in the Northeast. Maybe can you talk about any threats that we should be thinking about? I don't know if there's any scenario where outside mines, whether they're regional or other local basin mines and other basins could come in and disrupt the Permian supply demand dynamics that we're seeing. Maybe just expand a little bit more on your level of insulation from that natural gas weakness that we're seeing. Yeah, maybe I'll. This is Bud. I'll start, and these guys may wanna add to it. Obviously the disruption occurred back in 2017 and 2018 because the cost to transport sand from whether it was Illinois and Wisconsin or from Central Texas was just so high relative to local sand. you know, it is kinda interesting that we tend to get grouped with the other oilfield service providers in the Permian, given, you know, there has been cost inflation and the concern that operators have about that cost inflation and pushing back. As frac crews and other equipment that's on wheels moves into the Permian, there's more supply of services relative to the demand, which could provide the potential to reduce the cost of those services. The irony is that it goes the other way for us. The more frac crews that come into the Permian, the more sand demand there is, which is a tailwind for us. It means more demand for our sand because, you know, sand from outside the basin, you know, when you're talking $100 delivered sand from Illinois and Wisconsin with Northern White, is just not competitive with what Atlas provides here in the basin. It actually plays to our benefit, the softness in natural gas and equipment moving into the Permian. One thing, as you know as well, is that, you know, the Permian is the highest rate of return drilling in the country. You know, it's therefore a bit insulated even when oil prices do get a little bit soft. Operators tend to migrate their activity to the Permian, particularly to the Delaware Basin, where the Dune Express is located. Because that's the one area where they can generate a return on capital. Today, the half-cycle returns are extremely attractive. John, I don't know if you wanna add anything to that. No, I mean, I think that's just, you know, like Bud said, and then also, you know, we entered, we exited 2022, or I guess entered 2023 with 60 million tons of production capacity last year. You know, we're estimating that we're gonna see around 10 million tons come on this year. That's, that includes the 5 million tons that we're bringing on. I mean, when you look at that brings you to around 70 million tons of production capacity, and that's still below the, the estimates out there for 2023 sand of, like, I think Rystad has 77 million tons out there per year. Great. Appreciate all that color. Just as a follow-up, I mean, we're hearing a lot of talk from the E&Ps just on the public stage and their earnings call talking about proppant as an area of service price relief in the back half of the year. I mean, hearing from you and hearing from your largest peer, it doesn't really seem to be the case. I'm hoping that you could just help us reconcile those comments from what we're hearing from the E&Ps as far as proppant prices coming down, but from what we're hearing from you and your peers as far as contracted volumes, pricing remaining elevated, sold out markets. Just help us reconcile that for us, would be great. Well, I mean, it's a matter of supply and demand. As John pointed out, you know, the supply of sand locally is south of current demand, and that's why roughly 10% of the demand is being met by Northern White, which tells you there's not enough supply to meet the demand because that is just not cost competitive with the local sand. Now, that said, you know, you know, the land rush for sand, of course, happened in 2017 and 2018, and we tied up the best reserves were tied up then. It's a little bit like oil and gas and what happened with shale. Now you do have, you know, some tier three, tier four, some lower tier deposits that are being mined locally, which is beneficial for those local operators 'cause the transportation cost is lower. It's lower quality reserves, and it's like a small oil field that it goes on decline faster. It's just not sustainable over the long term. Those volumes that are out there do help on the margins, but as these guys talked about, that's 10 million tons that's added in the course of this year, 5 million largely from those smaller deposits, which helps on the margin. In terms of the total supply stack, it's just not that material. Great. Appreciate the color, guys. I'll turn it back. Thank you. Our next question is from Jim Rollyson with Raymond James. Please proceed with your question. Good morning, Bud and John. Good morning, Jim. Bud, you talked a little bit about Dune Express, just obviously kicked off construction, ordered a bunch of your long lead time items. Maybe spend a minute just on kind of how, you know, pricing, availability, delivery times, things like that for the Dune Express. I mean, at the end of the day, I think you summed it up that you still feel like you're on time for a 4Q 2024 operating date. Just kinda curious some of the sausage making on how, you know, available the equipment is and pricing meeting your expectations, delivery times, et cetera. Well, yeah. Thank you for the question, and maybe I'll start and John can really get into more of the detail on it. You know, we have a history of building our own projects. We built both plants. We're doing our expansion and of course the Dune Express. We're very good at it. Our team is really good at it. Having control of all the processes helps us control the budget and also the timing. We've been able to deliver as we are with the current expansion on time and on budget. We're off to a really good start on the Dune Express, which frankly is not as complex a project as building our plants and the current expansion. Very optimistic about delivering. We've worked hard to under promise and over deliver. John, do you want to talk more about the specifics on that? You know, as we said on the call, we'd ordered more than 50% of our equipment and materials. You know, we expect this number to continue to go up, probably be close to 70% plus or minus by the end of June. You know, when we put this project together, like Bud said, we built all of our projects. You know, where we saw it when we were planning, where we saw supply chain pressures coming, you know, we built that into our timetable. We feel real good about obviously the equipment that we've ordered and about the cost and the plans coming online at the end of 2024. You know, everything as we see it right now, still on time and on budget. You know, we got a pretty good start out of the gate here. You know, we've broken ground on the Texas side. You know, we've cleared right away. You know, we plan to start on the New Mexico side probably in the next couple of months. You know, as far as supply chain goes, you know, we haven't seen anything that we did not anticipate. You know, we did factor the long lead time items into the original forecast. Overall, we feel really good about where we stand on the project right now. I might this, Bud, I might remind everybody that doesn't know. We built 5 mi worth of conveyor in our two plants, which have worked very, very well. We've had no problems with them over the five years plus of their operations. Anyway, that's helpful to folks to know that we built conveyors and they're very efficient and reliable. Great. That's good color and helpful. Just one other question, Bud, for you. Seeing a couple of the larger operators in the Permian like Pioneer and just yesterday, Devon, now working, the guys that are acreage blessed that can do this, but working on three-mile laterals. I'm just curious kind of how you view that as an opportunity for you guys, because that's obviously, when you start going out that far, that's a lot of sand that has to be delivered in a fairly short period of time for that type of completion. Curious if those moves are helping you on the demand side of things as you think about delivering capacity on the Dune Express down the road. No, thank you. No, it's a real good point. Just one of a number of trends that are gonna play out that are gonna increase the demand for proppant. Obviously, the longer laterals. It's just another example of efficiencies that our industry continues to drive, whether it's drilling wells and completing wells that all drive up demand for proppant. I mean, the longer laterals mean every rig out there working and every frac crew out there working is gonna be pumping and needing more sand. The other thing is, as operators get into more of the tier two and tier three rocks, we think that's gonna require for the tight rocks higher proppant loading. In fact, in our non-op business, we're still seeing when operators experiment with higher loading and as they step into new areas, in most cases, not all, but in most cases, they're seeing better economics. I think particularly as you move down the road and you get into further into the simul-fracs and we're gonna see, you know, more of this development drilling and more simul-fracs, All of these things are gonna compound together and increase the sand demand as we go forward. Thank you for the question. Yeah, appreciate your answer. Thanks. Thank you. Our next question is from David Smith with Pickering Energy Partners. Please proceed with your question. Hey, good morning, and congratulations on a strong first quarter. Thank you. Thank you, David. Was hoping to circle back to the comments about production costs. If I'm triangulating correctly, I'm guessing your average production cost per ton came down around $0.50 or so sequentially. Wanted to check if that's in the ballpark, you know, if that's fully due to progress on bringing your mining operations, the dredge mining operations fully in-house, and how you see production costs per ton trending this year relative to Q1. You know, if there's any range of cost per ton improvement that you might be comfortable providing. Yeah, this is John Turner. you know, in the first quarter, you know, our plant OpEx was around $10.77 a ton before royalties, I believe is what the number was. you look at that was down from a high of around just around $13 a ton in Q4 2022. the biggest decline down from that was due to contract mining and third-party labor costs, which are really associated with bringing the dredge mining in-house. you know, in 2021, our plant OpEx was around $6.50 a ton. When you compare that with our cost today, the biggest difference is cost associated with bringing that dredge mining operation in-house. Yes, as we continue to bring that process fully in-house. You know, we expect our cost to continue to go down and continue to continue to decrease, and, you know, down to those lower levels that we've achieved in the past. Yes, that's a good observation. You know, our, our OpEx is trending in the right direction. We've already seen it happen here, early this quarter, early in the second quarter as well. That's great, color. I appreciate it. If I could ask one more? Also congratulations on the approximately 200 payloads in Q1, you know, delivered with over 70 tons per truckload. Am I correct that those deliveries started sometime in March? More importantly, you know, how should we think about those volumes progressing through the year? Yeah, this is Chris Scholla, Chief Supply Chain Officer. just to give you some color of our delivery timeline and our intense evolution of our logistics operations. January 3rd, we started our logistics operation with our first single trailer deliveries utilizing Atlas drivers and assets. On March 20th, we delivered our first double trailer to the well site with a 70+ ton payload. April fifth, we delivered our first triple trailer to the well site with almost a 100-ton payload. To put that in perspective, as we talked about earlier, that's about 4x the standard payload that you see delivered to location today. I think a big part of your future look question is look, seeing is believing, right? We've had major operators and service companies out to see our logistics operation running in the field in person. Seeing the fit for purpose double and triple trailers being delivered to the well sites, it really brings reality to the transformational logistics solutions that we'll be delivering in the Permian. We've seen a high level of interest and expect additional customers to transition to Atlas logistics solutions throughout Q2 and the rest of the year. From that perspective, look, there just aren't a lot of customers that don't want to be a part of a 70% reduction of associated traffic on public roads. That's what we see as our as our progression on logistics. You just answered my follow-up question. Thank you. That's all I got. Great. Thank you. Thank you. Our next question is from Doug Whitaker with Capital One. Please proceed with your question. Thank you. I'm curious how conversations are going around signing up additional customers for the Dune Express. How important do you view signing up contracts in advance, and is it reasonable to expect some more news on this front over the next, say, six months? Yeah. You know, I think now that, you know, I think for some in the market, it was, it was, the Dune Express sounded like an ambitious concept, and now it's very real. I think the level of discussion, and Jeff can speak more specifically to it, has increased. You know, it's really unusual for companies to contract out as far ahead as those two majors did for deliveries on the Dune Express. I mean, you know, as you know, we have a history as operators, and typically, you only contract out your next budget year. Unusually, at times, and it would be unusual, you might go out a couple of years. For those two majors to step out like they did was really unusual. I do think now that the Dune Express is here, it's real and in their minds and it's happening. Jeff can speak to the fact that the discussions have increased, a lot of them are just kind of trying to bridge their way forward to be there and be in the front of the line to be on the Dune Express deliveries once it's up and running. Jeff, do you wanna add to that? Yeah. Thanks, Bud. This kind of follows on to the question that was asked earlier about the, you know, we're seeing more simul-frac activity, 3-mile laterals, meaning more proppant, and more efficient logistics solutions. This, this plays right in to Atlas Energy Solutions strength as we move forward. What we're seeing is what we have coupled that with that right now is we have tangible, you know, assurance to these customers that this project is in fact going forward. We got construction beginning. We've had several tours on our locations, demonstrating this, that the trucks are running, the heavy payloads are running. This assurity, coupled with the tangibility of what our solutions offer is, and as Chris Scholla mentioned earlier, with regard to the sustainable benefits, from the environmental social safety perspective, is just acting as a very large attractant, to these thing in terms of long-term, commitment. Bud mentioned earlier on in the conversation, we expect these on a quarter by quarter basis to grow, our contract, volume commitments to grow, you know, and coupled with some of their roll-offs that are expected as well. Look for a real favorable, contracting session moving forward in the next 6 months. That certainly sounds encouraging. Just everything you've been talking about today, the outlook for Permian frac sand supply, demand looks very favorable. What are your thoughts on just formally moving forward with phase 2 of the Kermit expansion? I mean, a couple of comments on that. We are gonna have material growth in our production as we exit the year with this first expansion coming online. Let me just say that I think that we're very optimistic about our ability to grow production very efficiently. When you look back at our original plant design, the production expectations from those plants was 3 million tons a plant, 3 million-4 million, and we're producing 5.5 million tons from each plant. You know, I think a potential phase two expansion would come, you know, next year. I think I'm very optimistic that we're gonna be able to have some... Maybe exceed expectations in terms of CapEx relative to production growth in the foreseeable future. John, you can probably be more specific. Yeah, I mean, and I think, but, you know, really what we're looking at is, like Bud said, you know, originally our plants were designed to produce 6 million tons total. You know, we're on a run rate right now of 11 million tons. You know, we're gonna evaluate the situation as we move into the end of this year and early next. You know, the Dune Express itself is 13 million tons, we're gonna see, you know, we're gonna look at all the different options and see, you know, what kind of efficiencies we get out of the current operations. We've been very efficient in the past, and it's not taking the plant expansion off the table. It's just looking at what's the best way to achieve those additional volumes for the Dune Express. Yeah, what's the most productive capital to put to work to grow our production? We think we have some, we're very encouraged by our opportunities in front of us to grow production very efficiently, just to put it in summary form. Makes sense. Thank you. You bet. Thank you. Our next question is from Michael Scialla with Stephens. Please proceed with your question. Good morning, everybody. Just was a little surprised on your decision to pay a variable dividend while you're in the growth mode here. Just want to see if you can give us any indication of things the board will be considering as it looks to implement a longer term shareholder return program? Yeah, maybe I'll start and then John will add. You know, this company has really remarkable margins. In fact, it's very hard to find companies that have margins and generate cash the way that this company does. I also think, you know, there's some fundamental reasons that our industry has transitioned to, you know, to distributing capital back to investors. Personally, I think it's really important because it just demonstrates the transparency of your business and your ability to generate cash and return that capital to investors and transparency with regard to your value creation. In the case of this company, while we do have significant CapEx in front of us, you know, we raised $300 million in the offering, and we're generating very substantial cash flows. We are 90% contracted this year, over 90%. We think we're gonna exit the year over 80% contracted next year. We just feel like we've got great visibility on the cash generation from this enterprise to accomplish both, to fund these high growth CapEx projects, high rate of return CapEx projects, and to continue to distribute capital back to investors. I do think as those CapEx investments wind down during the course of next year, it will become an even more powerful distributing enterprise. I think it's to me, it's an important message to send to our investors that you are very important to us. John, do you wanna add anything? You know, I think that as we move through the year with the board, I mean, I think it's gonna be, "Hey, look, guys, you know, what is the highest return on investment for our investors?" You know, obviously, I think there's multiple ways to get return back to investors, either through returning cash, investing in, I mean, in growing stock price through additional growth projects is what, you know, we have that. Potentially buying shares. Potentially buying shares at some point. I mean, you know, they will be considering all those different factors, when we announce that. Yeah. We wanna get closer to the launch of the Dune Express. When we say the launch, you know, the finishing, the completion of Dune Express so that, you know, we can get so we can build in a fixed dividend. The plan would be to build in a fixed dividend, and then grow that fixed dividend over time. I appreciate all the color. That's great. I guess with the Kermit plant expansion on time and on budget, you know, you said you're at a kind of a run rate of 11 million tons per year. Can you give us any sense on what you'd expect in the fourth quarter, given where you're contracted, maybe both in terms of production and how the CapEx cadence will look over the course of the year? There was two questions there. One was the far as before we be in fourth quarter production and on CapEx cadence. You're right. Sorry, blended two questions together there. Sorry about that. You know, obviously, I think that, as far as capital expenditures go, you know, we'll be into the, you know, we'll be completing the Dune Express, but, you know. Well, in the fourth quarter of this year, we'll be completing the expansion. Yeah, we'll be completing the expansion, sorry, and we'll be, you know, right in the middle of the Dune Express forecast. You know, I don't think we've provided guidance on the exact what the timing of that CapEx will be. You know. Generally, we're comfortable with the analyst numbers out, that we've seen out there. Yeah. That's right. on the I do, I probably should restate that color that, you know, this company has had a history of delivering more production relative to CapEx in the past. You know, we're always innovating, and we're always updating our modeling and analysis and so we are optimistic that, you know, that we can, that we can expectations as we go forward as we have in the past. We will also, in addition to working on a dividend policy with the board, you know, over time, we'll also be working on a policy regarding forward guidance. At this point in time, we're comfortable with what the analysts have out there in general. Gotcha. Appreciate it, guys. Yeah, thank you. Thank you. Our next question is from Keith Mackey with RBC Capital Markets. Please proceed with your question. Good morning, and thanks for taking my questions. just wanted to start off with your contract and your sand contracting, really approach. You're highly contracted currently, you know, but we do consistently hear E&P commentary in the market about getting costs down. Just how do you think about, you know, looking for whether to contract the next ton of sand or letting it float in the market? Is there a specific price where you'll be agnostic to taking on the risk of where the forward market may go? Or is there other factors that really drive it? Well, this Bud, I'll start. Jeff will probably. He's definitely on the front lines on the market. I'll just say that, you know, again, there's a real bifurcation, you know, when you look at pressure pumpers, the supply demand dynamic there is very different from sand. You know, we still have 10% of the supply in the basin being provided by Northern White. You know, it's just a completely different environment for us and market for us relative to some of the other oilfield service providers. We have a non-op company. We do have real-time data on the cost inflation that has occurred. I'll just say that the rate of return on drilling projects at the current oil prices is very attractive. You know, the tier one rockets around 100%, plus or minus. Even in the tier two rockets, 40%-60% IRR. I think, you know, the rate of return on projects for operators is very attractive at these levels. Jeff, do you wanna answer more specifically on how the market's shaping up for you? Yeah. Yeah. I'll answer in that it's really, you know, we manage our contracts and our clients on a portfolio basis, which means that we approach each one case by case. You know, what goes into consideration of that, obviously, strategic value pricing, and how they align in, you know, with our strategic goals as well. We're finding that here, in most cases, the high-quality customers in the basin, do in fact align with that. Again, case by case basis. Got it. That's helpful. Just on the Dune Express, good to hear that you've got a bunch of the materials ordered. As you've made those orders relative to, you know, any agreements you would've had before or caught now, anything you would have done before, you know, during the spring perhaps or in the winter, what inflation or deflation, if any, have you seen on the actual materials you've ordered relative to the pre-order phase? You know, I'd say it's come in right where we thought it was. We, you know, we've been in the market prior coming up to this, our, this project with our current expansion. Things like steel costs, belts, drives, you know, we had a pretty good handle on where the costs were going or where we thought they would be. We haven't seen any surprises on that front yet. You know, and then we did have a number of POs prepared, that were written that we were working on prior to the, you know, until before we decided to launch. We haven't. I mean, like I, like we said earlier is, you know, we've done these projects before. You know, we forecasted long lead time items and also in part of that, used our current market information to forecast. We factored that into the forecast when we were putting this together, so we hadn't really seen any surprises on that side. Got it. That's it for me. Thanks so much. Thank you. There are no further questions at this time. I'd like to hand the floor back over to Bud Brigham for any closing comments. Thank you, operator. Thank you all for joining our call. We really appreciate your participation and look forward to reporting on our second quarter results. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.