Seifi. So are you good to go? Oh, yeah. Okay. All right. Okay. Well, great. Thanks, everybody, for joining us today. We're very happy to welcome to the stage Seifi Ghasemi, the Chairman of Air Products. I've known Seifi, I think, probably 25 years now, going back for a couple of iterations at different companies, and a lot going on at Air Products. Obviously, it's one of the companies that probably has the most incoming call volume for us, the most interest from investors, so again, very, very happy to welcome Seifi up to the stage, so a lot to get through, Seifi. Maybe if we can start, let's just start. Talk us through where we're at in your hydrogen strategy, kind of where have we come from, what's changed this year as you've made some announcements and stuff like that, and kind of where are we going over the next several years? Sure, Duffy. First of all, pleasure to be here with you and also the great audience that you have over here. And I see some of our shareholders here. Good to be with everybody. We are, as you very well know, Duffy, we have a two-pillar strategy. Our base business, which is by far the best industrial gas business in the world, most profitable. We are feeding it. We are investing in it. Half of our investments in the last four years, half of our total capital investments have been in our base business. We have gained market share, so that business is doing very well, then the second pillar, which is our hydrogen strategy, is an extension of our existing hydrogen business. And that is our growth strategy because it is focused on low-carbon hydrogen. That is going to be the only choice the world has in order to really decarbonize the heavy industry. What we are seeing as the years go by, every year, significant additional encouragement that we are on the right path because the demand for the product is developing. It's becoming obvious that the very heavy industry sectors like chemicals, like steel, like shipping, they are. And also replacement of existing facilities that are producing ammonia, which puts a lot of carbon, and now you shut them down and replace that with the kind of product that we make. It is giving us more and more and more encouragement in terms of the fact that we are not pursuing something that doesn't exist. We have not been too aggressive in trying to explain that to the investors because it's obviously the best thing is to wait for things to happen and then everybody sees it rather than trying to advertise it beforehand. But I think that is why a lot of investors are sometimes saying, "What are these people doing? What are they pursuing? Why don't they talk about it?" Well, we don't want to talk about some of the real applications because we don't want to give the clue to our competitor. So I'm as excited, if not more excited, about our hydrogen strategy than before. In terms of the investments that we are making, we are really making two big investments. One is the green hydrogen plant in Saudi Arabia, and the other one is the blue hydrogen facility in Louisiana. So we are not building 10 plants. We are building two plants, one to demonstrate larger scale green and one to demonstrate larger scale blue. And we will load those plants, and everybody will get very comfortable that it's no different than any other investment that we make. It is going to be on a long-term contract basis. And I think once we do that, then I think in time, people would be really after us to build the next one and the next one and the next one. We are going to be responsible. We have always been responsible. We are going to be very thoughtful. And if we see things that are not developing the way we thought, we'll stop. The same way that we did stop the project we were going to do in Northern Texas. That project was dependent on 45V, which is the $3 for green hydrogen. We got concerned about how is green hydrogen going to be defined. If people are going to define that green hydrogen, if you take excess nuclear energy and convert it to hydrogen and you get $3, it's pretty damn difficult to compete with that. Besides that, the U.S. wasn't too much of our target anyway. What did we do? We stopped the project. We are very encouraged by what is happening. We are investing very prudently on only two major facilities to demonstrate that there is demand. Then after that, then we'll see how everything works out. At least in addition to our base business, we do have a growth strategy. And so I guess one of the questions I get a lot from investors is just the hydrogen consumption industry and who can afford to actually pay the premiums. Again, if you're investing billions of dollars, let's say in NEOM, who can afford to pay that? Is it because of government subsidies? Is it because they're getting forced to when they have enough profit margin? So could you help people and maybe use NEOM as an example, where that might end up going and what's the timeframe for kind of locking that in? Is it, again, we think we can do it soon, or is it going to be closer to when the plant starts up in a couple of years? So that hydrogen consumption part of it, I think, is one of the biggest questions that we get. Sure. The hydrogen consumption is going to be in industries which are difficult to decarbonize. If you are looking at passenger cars, passenger cars are going to be electric. It doesn't make sense. If you have green electricity, you put it directly into the car. It's kind of stupid to take the green electricity, make green hydrogen, and then put the green hydrogen in the car. So light vehicles are going to be electric. I'm not sure the right thing. But when it comes to making chemicals, when it comes to shipping, when it comes to planes, and when it comes to chemicals and steel making, it's not possible to electrify them, to use electricity to decarbonize. So you absolutely need hydrogen. And the hydrogen is going to be in the form of either green or you use hydrocarbons to capture the CO2, blue hydrogen. Now, the question that you're raising, why would anybody pay for it? Well, I'd just like to give you an example because at the end of the day, with these things, the consumer will pay the same way that you and I go and pay for buying organic beans rather than ordinary beans. We pay a premium because we think it's the good thing. But for example, to be very specific, if you take a refinery, 300,000 barrels a day, like one of the refineries that we are going to decarbonize for Dow, you need 70,000 tons a year, 80,000 tons a year of hydrogen. So people look at that number. It's 70,000 tons. That's 70 million kilograms. And Seifi is saying he wants $8 or $9 times. So that's $500 million of additional cost for the refinery. Oh my God, how is that going to work out? But that refinery is producing 13 billion liters of gasoline and diesel every year. 13 billion. If total. By having green gasoline at the pumping station, the same way that you and I go, there is ordinary gasoline, there is super. You pay a premium. And now there is green. All they need to do is increase the price two or three cents. And you pay two or three cents on $2-3. Another example I give you. Steel. To make one ton of green steel, you need about 60 kilograms of green hydrogen. 60 times $9, that's $500 a ton of steel. And people say, "Oh my God, right now I'm making steel for $600. This is almost doubling the cost." Well, obviously, when you use green, you are not going to use coal, but it is a substantial increase. It's about $400 a ton increase in price. Who the hell can afford it? Well, take a Mercedes-Benz car, like the one that I drove in today. That car is what? $120,000. So you're telling me that Mercedes, if they put a plaque in there that this thing is made with green steel and there is only one ton of steel in that car, and that car goes from $120,000 to 120,000 plus $400, I wouldn't buy it? That is how these things are going to be paid for. And the same thing with shipping. Right now, if all of the big tech companies want to decarbonize, where is the carbon footprint of Microsoft? They don't have a plan. The carbon footprint is on the ships that carry the computers from China to the U.S.. Well, if you actually calculate and we had somebody calculate this, that if that ship uses green ammonia to bring that stuff and we charge them what we need to have a good return, the additional cost per computer, per cell phone is $0.01. So that is how this thing is going to happen. It's going to happen in a very big way. But just like anything else, you just have to gradually go forward. And then people say, "Well, you're building a plant, but you don't have a customer." But unless we build the plant, the customers are not going to come. I mean, take New York City. The first time that Edison built an electricity generation plant, not all the houses were using electricity. He had to have somebody like J.P. Morgan giving the money, and the only consumer of electricity was his house, which was 1,000 of the capacity. But then once people saw that, then everybody else converted. So somebody needed to demonstrate to the town, to the steelmaker, to the shipping people that, "Look, you can make this product at industrial scale, at reasonable cost that you can absorb." And that is when right now, we have signed one contract in Europe. Right now, it's 20 refineries want to buy us. And all we need is three refineries to convert, and they are sold out. So that is why I'm so enthusiastic about what we are doing. And the people who criticize us, with all due respect, are not taking the time to really think this thing through, and they're just listening to hype. "Oh, there is no demand. There is no demand." These guys are taking risks. They are building plants in the middle of the desert that nobody is going to buy. These are going to be white elephants. That is just not the case, and I get emotional about this thing. Is that for God's sake? I am a shareholder of Air Products. I own about a million shares of Air Products, as much as a lot of the investors. If Air Products spends $20 million, that's $100 million of my own personal money. You think I'm going to take a risk by jumping off the roof without a parachute because it's exciting? They are business people. They are making decisions. The only thing that they are doing is that they are a few steps ahead of the people, which is how you get rewarded. Sure. So you mentioned the 45V gave you some concern with the Texas project. Louisiana has helped with the 45Q. New administration coming in. That one's a little bit more settled historically. Do you think there's any issue that the 45Q could be turned over? No, I don't think it. I honestly will go out on a limb and say there is no risk on that. 45Q has been in law for a long time. We, as Air Products, have been the only company in the world who brought in the technology of capturing the CO2, and we have been benefiting from that for the past 12 years. And we have been capturing the CO2. Now, that CO2 is not sequestered. It's used for enhanced oil recovery. Now, what they did was that you would get $50 per ton of CO2 that you capture. Now you get $85. They increased that because of inflation and all of that. So that law is there. But the other thing is that in terms of support, 45Q, what it does is that it gives you the ability to extend the life of hydrocarbons by capturing the CO2. So it is something that is 100% supported by the oil and gas industry. And we all know that they have a lot of influence over these things. And as a result, I see zero risk on that. Okay. Can we step through the big projects and just kind of level set where we're at with that? So let's start with NEOM, which is kind of the biggest, most exciting for you, I think, historically. $800 million, roughly, in the JV. I think the last update we had was $2 billion kind of needed for the distribution build-out for that. So call it $2.8 billion. Where are we on the construction of that? And then how to think about the return on that $2.8 billion going forward? Sure. Number one, the $800 million is correct. It is our share of actual capital that we have put in. The total project is $8.5 billion. There are three partners. But we were able, despite the fact that we don't have the offtake agreement, we were able to finance that. So the total equity is about $2.1-2.2 billion. But our share of it is about $800 million. In terms of investment for the downstream, it depends how we sell this thing and to whom. As I said, we don't need that many refineries. So there are people who want to buy the ammonia from us at the port for shipping and for a lot of things. If we sell it out to them, most of it, then there is not much of an investment downstream. If you sell all of that to one company, then the investment might be less than $2 billion. If you sell it to, so the downstream investment is something that depends on what is the final sale out of that facility. The second thing, in terms of the return, we have said, and we continue to say, that the return on our low-carbon projects, because we are the first one, because we are the first mover, the returns on those projects are going to be better than the returns that we get in our conventional industrial gas business. Okay. And there's been some change at the high-end NEOM level. The CEO stepped down a couple of weeks ago. There's been a number of kind of reports written that the actual all-in NEOM city has struggled. Has that caused any issues for you? And kind of how is the construction, which you are now the lead EPC on? How is that progressing? And some people always have a concern there might be another capital bump or increase in capital costs. How is that going? You're asking an excellent question, and I'd like to take you back. We got punished quite a bit when we announced that we are going to spend. We had said $5 billion that we were going to spend $8.5 billion. At that time, I kept saying that, "Please pay attention to the fact that we are doing this thing because it's a cost of financing, but we are investing more to be totally independent of what happens to the rest of NEOM City." That was a good decision. Because right now, whatever happens to the NEOM City doesn't matter. We are building a standalone facility. We have the permits, and we are almost 60% complete. Every time I show a picture of that to people, I have to remind them, "Please, this is a real picture. This is not computer-generated." We are building the facility, and we are totally standalone. Whoever is the CEO of the NEOM City is our partner. They work for PIF. They work for the government, and we work with them like anything else. But our project is self-contained, and that was the right decision at the time, despite the criticism, to do that because we just wanted to make sure that we are safe. Okay. And then maybe let's jump to Louisiana Blue. Because again, that's one we get some pushback from investors on. Permits have obviously been an issue. But all in, where do we stand with that one as far as kind of completion or money spent? And how confident are you that the permitting can be done in the timeline that you want and that's not going to impact your ability to complete the project and start sales? I think it's like 2027 is what we're targeting now. First of all, we don't have an issue with permitting. The fact is that people don't give you a permit after you submit. They take their time to approve. And I'd like to go through that. With that facility, we need permits from the local government. We need permits from Corps of Engineers, and we need permits for the Class VI well. We are well on our way with the other permits. We have submitted them with the local authorities and the Corps of Engineers. I don't expect any issues with that. They have given us permits to go and clear the land and all of that and prepare for piling. In terms of the most critical permit, which is the Class VI well, what you need to do when you go and apply for a Class VI well, you don't just go and say, "I want to sequester five million tons." It is required that along with your permit, you submit data based on actual seismic studies that you have a pore space that can actually absorb this. You have to do that homework. We have done that homework. We have spent almost between $75 and 100 million proving that the pore space that we have in the state of Louisiana can handle the CO2 sequestration. That I'd like to emphasize. That is the most critical advantage that Air Products has because other people have not been able to demonstrate that. So those tests that we did were very successful. We have a very, very good pore space. We have put all of that data together and submitted a formal application to the state of Louisiana about five months ago. The state of Louisiana, which has supremacy now, they came back to us and they said something which is very important that we consider your application to be complete. Now we are going to study the data and give you the permit. So that approval, we expect that it will take about a year. It might happen sooner. It might happen later. But the part that gives us confidence that we will get the—I mean, the authorities might come back and say, "Okay, we don't like the way that you have designed the Class VI well. It should be bigger. The thickness of the pipe should be bigger and all of that." But they are not going to deny us the permit because we have proven that we have the space. It's just how we do that. So we feel very confident to get it. It's a matter of time and complying with the rules. So where we are with the project is that we are very well advanced on engineering. We have ordered the major pieces of equipment. In terms of actual expenditure and commitment, we are at around $2 billion out of the $7.5 billion. Then I'd like to clarify one thing is that the investors shouldn't expect that Air Products will spend $7.5 billion of our own money in there. We have the option to project finance that project the same way that we did the NEOM. We have been approached by many people who would be happy to co-invest with us in equity. We are considering some of that. Some of that are interesting options. But we are taking our time to decide. We are in no hurry. That plant is going to come on the scene four years from now. We are not in no hurry to run and make a deal just for making a deal. So we feel very good about the project. The concept is right. The consumers, we know who the consumers are. And the important thing for us is not to get bullied into, "Hey, go sign the contract because some activist shareholder is in the U.S.," and show a piece of paper. We are not into that kind of a game. We are going to take our time, do the right thing for long term for Air Products and its shareholders. Okay. Maybe jump to Canada, the Canada project. So that's when the pushback we get on that is I think people would say they like the project in general. You've got a lot of support from the government up there. And I think you've got 60% offtake, something like that. But the thing that has tripped people up, people were surprised that Dow actually went with one of your competitors in that area because you've kind of dominated Alberta from a hydrogen standpoint. I think you've got the only pipeline. You've already got some older SMRs up there and now the Blue. So you would think that you would be the natural incumbent that would win new business up there. And so I think that's the question we get the most is just why would Dow have kind of gone with a non-incumbent in that geography versus you guys? On that one, I will not pull any punches on that. First of all, people think that what Linde is doing for Dow is going to give them hydrogen to sell. That's wrong. What all they are doing is decarbonizing the Dow line. What Dow is doing is that they have a stream that has hydrogen. They want somebody to go and invest, take the thing, clean it up, and give them back the hydrogen to burn. So it's not going to give you the ability to supply somebody with 200 million standard cubic feet of hydrogen. Number one. Secondly, we did participate in that bid. We were one of the two final bidders. Then at the end of the day, it came out to a 6% return project, and we said no because we didn't need the project. We saw that we don't do 6% project. Now, you can go and ask Linde what was the return that they got. So I don't see them as a competitor there that, "Oh my God, we are making net zero hydrogen to be able to sell to the refineries there." And now there is somebody else doing the same thing. They are not doing the same thing. They are just helping Dow with cheap capital. So what does that do? I'm not in the business of financing Dow to go and decarbonize. So we did participate in that. But we just absolutely put our foot down and said, "No, we are not going to do a low-return project." The same thing with the project with OCI in Louisiana. We were the first people that OCI came to, and we said, "Blue hydrogen is $5 a thousand cubic feet." "Oh, the other guy is going to give us a much cheaper price. Go to the other guy. Okay. The last one is just the one that's on pause in California, so SAF. So there's some concern as to how much is totally invested in that project from your standpoint, and then how to think about the return on that investment from here forward. How do Air Products shareholders get paid? Sure. The return on that project, the way we have the agreement, is that when the project is built, whatever the cost of capital, whatever it is, Air Products will get 11% return on it. That is the agreement. Now, with that project, we have obviously had a setback, and the setback is that we thought we had a refinery. It had a permit. We go under that permit and build our facility. Then people went and sued us totally unexpectedly. The judge said, "No, the refinery is shut down, so the permit goes away," so we have to restart with the permit, which is what we are doing, so we are going to wait until the end of 2025 to start that project, and that project is a great project. The demand for SAF is there. We are making SAF right now in the current refinery. We can sell every barrel of that that we are making. And sometimes, I mean, it is in California. It is unexpected. That's the way it is. So you live with it. Not a big problem. And then again, we'd love to sit up for hours, but we'll run out of time. Elephant in the room is obviously the proxy battle going on. You had D. E. Shaw with their slide deck come out, Mantle Ridge. So if I kind of boil down at least from the D. E. Shaw, which is the public slide deck yet, Mantle Ridge hasn't kind of put out their presentation publicly yet. But a couple of things that they brought up, and I'll just run through them if that's okay. So first one is just the succession plan and the likelihood that we can get that in the right place in a timely manner. I think the pushback I get from investors is the scope that you brought out where you want somebody who's been a CEO or who has been very good. Why would they take a step back and move into a president role for a period of time? Would it be hard to find somebody to do that that investors would think is a good CEO? So just kind of that process and what you're thinking on the succession and why you wouldn't be able to get it done, I guess, before the proxy vote. When you look at the succession plan, what are we talking about? If I walk out of the door and get shot like the guy yesterday or get hit by a truck, we have a succession plan. We have had that for 10 years. We have identified one of our board members who will immediately take over and go and hire somebody to do that. If we are talking about making sure that people say, "You have somebody that the process is in place, that you have a chief president or somebody like that that we understand who the person is going to be," we have had no issue. Since I mentioned that in August, we have right now quite a number of people with those qualifications who are willing to come and be a successor. Why? Because Air Products is a great company. Number one, at $75 billion market cap, we are the largest chemical company in the U.S. We have a great strategy. We have a great future ahead of us. Air Products five years from now will be, I mean, people forget Air Products market cap right now is the same as BP. So why wouldn't people come? So I have no reservation that we will attract those kind of people. And we have set a time that our board will make an announcement by the end of March about who is going to be that person. And I think the investors, they obviously want to hire the right person. And I don't think we'll have any issues with that. I mean, the board is in charge of the process. We have identified very good people. But we don't want to run and announce somebody just because there is an activist shareholder. So what? What is an activist shareholder going to do? At the end of the day, we have an AGM. Well, let's wait until we go to the shareholders, and the shareholders will decide. We are not going to settle with anybody else. Wait until we get to the AGM. Another point of contention in start point, stop point matters a lot for relative returns, right? You can find a day—but for me, the change in strategy started the day that you guys announced NEOM. So if we go back to, say, 2020, the day that you announced NEOM, Air Products has underperformed peers in the S&P fairly meaningfully since that point. What is it about that? Is it that you don't think investors give you enough credit yet for what's happening with hydrogen? Is it just something in the footprint that you were trying to overcome that you couldn't get there? But what do you attribute kind of the underperformance during that period versus peers in the S&P 500? It's convenient to look at a certain period of time. How about if you go back to 2014 and the fact that the stock was 100 and now it's 330? It depends where you choose your time. 100%. Yeah. That's fair. But the second thing is that I think we have an issue that the investors not only are not giving us credit for the future income from these two big projects, but they're actually punishing us by saying, listening to a lot of their rhetoric, "Oh, they're building plants. There is no demand. Therefore, the prudent investors are buying." You look at who is buying our shares. There are people who just recently bought six million of our shares. There are people who own 15 million of our shares, and they owned zero two years ago. It's because some people have done their homework. Some people have not. But we should not run the company on the basis of day-to-day looking at the stock price and making decisions. We are trying to create wealth for the shareholders for the long term. If people are coming into Air Products stock because next quarter or next quarter, well, some of them may make money. Some of them may lose money. I'm not focused on those people. I'm focused on creating value. We, as a board, are focused on creating value for the shareholders for the long term. That is why they pay us. If it was on a day-to-day basis, well, anybody can run the business on a day. Stop everything. Don't invest on anything. The cash comes in. Keep going and buying. Every day you look at your share price is down. Go buy shares. It goes up. Then you don't need to pay somebody $20 million a year to do that. Fair. And we're running out of time, but I do want to get one last question in just kind of current business. Obviously, industrial gas has a lot of concurrent touches on the economy. What are you seeing as you look around the world kind of in your different big end markets? What's happening in the world today? Anything getting better? Right now, the way it is, if there are no major changes of policy, which there might be, but if there are no major changes of policy, we feel good about the U.S. and Europe, but we are very concerned about China. We are a very good leading indicator because the products that we make have to be used right away. Otherwise, they evaporate. So we can tell you every day what is the economy in every part of the world doing. China doesn't look good. That is one of the reasons that we have given you a conservative estimate for guidance for 2025 because we don't know what's going to happen in China. All of the hope, this is where we made a mistake. Q1 of last year, the results were bad because we thought China is going to go like this after COVID. It didn't happen, and right now, the Chinese government is not taking the kind of decisive action to turn around the economy, so we are worried about that. Now, if there are major policy changes when the new administration comes, then that becomes another thing to worry about, but I don't want you to anticipate that. Sure. We'll see what happens. Listen, Seifi, again, thank you so much for coming and spending some time with us today. Appreciate it. Thank you. I appreciate it. And I appreciate your good questions. Thank you. Thank you.