Hey, everyone. Sorry for the late delay, late start here. Just had some network issues in Chicago with Tony at CF, but we're very happy to have Tony Will, who's, of course, the CEO of CF Industries. Here, we'll talk about ESG, some nitrogen, cap allocation, how it all gonna play out in the next couple of years. Tony, sorry for the late start. Thanks for joining us. Yeah, no, it's a pleasure to be here. I apologize. We just recently changed offices, and we're still working out a little bit of the kinks on the network side, but it's a pleasure to be here. Thanks for having me. Okay, Tony, why don't we. We'll go through a lot of subjects. Why don't we start off with some of the, you know, more, the stuff, the investment projects you've been working on, some of your blue ammonia projects? Maybe just give us a recap of where you are right now in some of your low- carbon ammonia projects and, you know, where you are in the decision-making process for maybe doing a greenfield with Mitsui or somebody else on a, again, on a greenfield blue project. Yeah, you bet. So, the first project that's gonna be online is our green ammonia project. That's in Donaldsonville. We'll be mechanically complete here within the next couple of weeks, and ideally, we'll be starting up either just before the end of the year or early in January. So we're excited to be able to bring that project finally to fruition. It's been about three years in the making, and we're really excited about it. The next project that is likely to be on stream for us is the dehydration and compression project for CO2 at Donaldsonville. As you'll recall, we signed an offtake agreement with ExxonMobil, who's going to be moving 2 million tons a year of CO2 out of Donaldsonville and into permanent geological sequestration. We should be mechanically complete with the dehydration compression in about a year, maybe, in the beginning of 2025. And we expect to be shipping CO2 and sequestering it, beginning probably about the middle of 2025 at this point. And that's a very exciting project because under the 45Q tax credit, we'll start earning at a rate of $85 on a gross basis per ton of CO2 captured. And we've got about, you know, I think about $30-$35 worth of cost, all in, in terms of being able to process and sequester the CO2. So we'll be netting about $50 a ton on 2 million tons a year, beginning kind of midway through 2025. So that's a very exciting project, and that's just on the CO2. That says nothing about the potential enhanced value of the project or the product itself. Relative to a potential greenfield project with Mitsui or somebody else, as we are finalizing the FEED study data right now and compiling all of the numbers, we'll be in a position when we get to the full year call in February to give a much better indication in terms of where we're at, what that looks like, and is there an immediate path forward on that one. So we're making good progress in daily communication with potential partners and, you know, it continuing to move forward. Okay. By the way, audience, I forgot to mention in our rush start here or late rush start, you can ask a question. Please ask a question in the ask a question box. Type it in, I will weave it in, and I'll get Tony your question. Okay, Tony, so thinking about some of these projects, okay, so we're gonna have a little bit of, you got a little bit of green volume coming out, in early 2025. I mean, how did any... I know it's a very small amount of volume. Have there been any discussions, any customers? What kind of value you would place on that or you would place on it? When do you think we'll know when you sell your first tons? Yeah. I mean, the way that I think about the green project is we'll be making about 20,000 tons of green ammonia per year. And so even if we start up at the beginning of January in 2024, it's gonna take quite a while for us to develop enough of a volume for an international shipment or even a domestic shipment. And so we are engaged in ongoing discussions with a number of potentially interested parties. You know, Joel, as I'm sure you're aware, it's a fairly energy-intensive process to crack water, essentially, and to create green hydrogen and green ammonia. And so the cost structure of producing green is substantially higher than producing conventional or blue. So our expectation is that, you know, the sales price needs to be commensurate with what the full end cost structure looks like, including capital recovery. While we're, you know, engaged in these conversations, it may take a while to find kind of the right applications where the counterparty is willing to pay that kind of number, but we're confident we can get there. So this is a bit of a, you know, it's a new project, trying to feel it out, small volume, very small volumes. You know, if it was successful and you wanted to build a larger green project, at no point has CF ever said they want to do that. I'm sure maybe you can tell me you don't want to do that, but let's say you did or someone else did. What do you think? What type of ammonia price do you need to justify, you know, a world-scale plant for green ammonia? Yeah. So, today, you know, natural gas in Henry Hub is sub $3. So the energy content in a ton of conventional ammonia is $100. The energy content in a ton of green ammonia is closer to $450 or $500, and that's before you get to capital recovery on all of the investment. It's also before you have the energy costs associated with running an air separation unit. That's a completely distinct part of a green ammonia project. And so, you know, realistically, the cost that you need to be able to recover, to cover energy costs and capital, is gonna be pushing, you know, four figures, on a green ammonia ton. Right now, we're just not seeing a lot of demand at the end market side to really step up and say, "Yeah, you know, give me more of that." There is a provision in the tax code where there's a hydrogen production credit that can certainly add some potential value, and basically buy down the cost of a ton of green ammonia. But the rules have not been finalized yet, and some rumors floating around in terms of, Biden administration proposal, is suggesting that, the rules for new renewable energy additionality is gonna be pretty stringent, which means it's even more difficult to get some of those projects approved. So I would say the time for massive investment in green ammonia production is not upon us. In fact, I think it's probably decades away, and we're really focused on what we can do with carbon capture sequestration and blue projects, because we think, it's a much lower cost alternative, still delivering, a very, very low carbon intensity product, and certainly miles ahead of where we are today in terms of environmental impact. Okay. So then, you know, looking forward to some of the meat of what you guys are looking at, you expect to start really putting out some blue product and sequestering carbon into 2025, in 2025 and by middle of 2025. You know, what kind of discussions do you have with customers about pricing that? I know the 45Q credit kind of justifies the investment. What kind of premium pricing or anything have you discussed with customers, or is it still too early? Yeah, no, we're beginning those conversations. And what I'd say is there's an awful lot of interest. Basically, everyone that we've talked to has said, "Yeah, we want some of that." And then when we talk about a premium, then they get a little bit more squeamish. And my guess is what we're gonna do is find applications for which the premium actually holds up, and our customers can then turn around and realize the value in the marketplace or pass it along with their customers. And, you know, but the market will sort of arbitrate who just wants it and who is willing to pay for it and value it. So we're beginning some of those conversations now, but let me give you a couple of examples of places that are developing that look more real than not. Interestingly enough, some of them happen to be in an agricultural application. So to get a very low carbon intensity ethanol product that qualifies for the California Low Carbon Fuel Standard, there's a lot of value associated with that, and having a low carbon fertilizer going into growing that crop is an important point. Similarly, Brazil is making sizable investments in developing an ability to produce sustainable aviation fuel, particularly for the European market, and similarly looking at low- carbon- intensity fertilizer to help bring that along. In addition, we've talked to a number of other applications, whether it be on a mining services basis or other places like that, where there's a lot of interest, although quantification of premium is still in discussion right now. But suffice it to say, there's an awful lot of interested counterparties, and it really just is gonna require settling out on the value. So I'm just thinking out on the top here. So thinking about the low- carbon, ethanol idea. So, you know, I've done a lot of work on carbon cropping and... Excuse me, on cover crop and no-till. And you saw these, some of your competitors, and some of your crop competitors, and other companies looking at some of these trials. Is that, like, would you be in competition with growers to try to convince them to use a low- carbon nitrogen, versus some of these no-till cover crop programs that are gonna get paid X amount per acre? Is that, are you getting competition with that then? Well, I'm not even sure that that's necessarily competition. It's not obvious to me that that doesn't stack. I think some of the problems with thinking about the forestry-based type credits is the duration involved is very long, and the value received upfront is relatively small. And so for a Low Carbon Fuel Standard, it, I think, is much more appropriate to think about how much carbon is actually going into the supply chain, or said differently, what's being pulled out relative to other forms. And that doesn't require the same kind of basis that you're talking about forestry-based credits for carbon sequestration in the soil. So if you're not, you know, if you're going no-till, if you're using a low or no carbon fertilizer source, if you're capturing CO2 coming off of the fermentation and distilling process, you know, there are ways where you can basically get a very low carbon product, that should meet that standard. And it's not really in competition with cover cropping and so forth. Fair enough. Okay. And then I know you said you're updating your numbers or your scenarios with Mitsui for maybe a new or greenfield blue plant. Do you think, you know, as assuming you're accelerating some of the CCS for Waggaman, plus you have Donaldsonville, do you have enough CCS capacity, blue capacity between those two plants that maybe a new build doesn't make sense at this point? Well, our expectation continues to be that the market for a low- carbon- intensity of ammonia product will grow and will continue to grow relatively rapidly. Everything that we're talking about with people we've signed MOUs with or joint development agreements with, so, you know, Mitsui, JERA, Lotte, POSCO and others, suggest that the demand is real and it's going to be coming in in sizable amounts. The big question is: what is the carbon intensity threshold that you have to hit? And what are the other requirements in terms of the Asian parties' equity investment for participation in the projects themselves? And so, we certainly are going to have a nice baseload to begin helping serve a developing marketplace based on what we're doing at Donaldsonville and can replicate other places. But I think longer term, the world is going to need more blue ammonia, and I think we're in an ideal position to add that capacity if and when it needs it. You know, Tony, you and the rest of the team at CF really were excited about some of these opportunities a couple years ago. Talk a lot about it. I mean, some think maybe the little luster has come off some of the low carbon ammonia opportunities in the last couple of years. Do you share that view versus a year ago, two years ago? Like, how has your view of this market changed and what's changed? And maybe you elaborate. Yeah, let's talk about it in two different pieces, one of which is on the supply side. And I think on the supply side, you know, there was something like 100 different projects that were announced, and there was a lot of frothiness. And, you know, our expectation at that time was, it's easy to announce a project. It's a lot harder to actually build one and bring one online. And I think, you know, some of the loss of luster might be because people are looking at what's happening across a number of these previously announced projects and see that they're either being canceled or deferred, and therefore, the conclusion is, maybe this is not quite ready for prime time yet. Now, I'm going to contrast that with what's going on on the demand side. You know, we've had people just very recently over in Japan visiting with JERA. They are putting real capital in the ground. They are moving forward with their large-scale Hekinan power facility. You know, our expectation is that that's going to continue to move along at basically the pace that we thought it was. The Japanese government has been a little bit slow in terms of finalizing the subsidy schemes and the regulations around it. But that's not really going to affect our ability in the near term to supply that demand out of Donaldsonville. What it might affect is either the type of technology or additional flue gas capture that's required if we go down the path of the greenfield plant. But those things are things that we can, you know, wait and see how it develops. It's not going to affect our ability to actually meet that demand as it emerges. And I think all of our expectations, including the end users in Asia, continue to believe this is the path forward. Just remind everyone, please submit a question. You ask a question box. Before, maybe, Tony, we'll move on to talking about the market, the Ag market, and capital allocation and other things like that. You know, it seems like the marine fuel opportunity is coming. I definitely see it methanol, all these ships being built, although a lot of the experts think ammonia in the end, will have a larger opportunity in marine fuel, maybe next decade, though. Can you talk about that a little bit? Are there challenges here with ammonia, trying to figure out, you know, how best to use it? Get the right engines being built for the ships. Yeah, I mean, I think, methanol certainly is an improvement over bunker fuel where you are today, and in some cases can be, either a drop-in or a near drop-in kind of replacement. And so there, there are some advantages, I think, that methanol, potentially offers, although there is a carbon, molecule as part of a, a methanol atom, so it doesn't really get you a molecule. It, it doesn't really get you all the way to, to zero carbon. Ammonia, on the other hand, does. I think the, the things that we're working through, because we're actively involved, on both the propulsion side as well as on the-... Maersk Mc-Kinney Moller Center, looking at kind of technical challenges and issues that need to be overcome. I think, you know, we firmly believe, based on our track record of safe handling and storage and movement of ammonia, that the systems can be built that are 100% reliable and can be deployed appropriately in marine vessels. I think one of the development points is really about the ongoing bunkering and resupply piece from ammonia. Now, fortunately, ammonia is already in and out of something like 175 ports globally, so it does provide an initial footprint for us to be able to leverage. But I think for ammonia shipping to become really the propulsion energy source of choice, it needs to be built out, you know, basically into every shipping port that's out there. And so there is some time lag associated with that, but we believe that this will continue to be an ongoing developing source of new demand. And, you know, it it's exciting in terms of how big this can ultimately be based on the size of the fleet that's out there. Okay. Why don't we switch over a bit and we'll talk about the nitrogen markets, and then we'll try to tie it all together later on in this, in this capital case? So, I mean, it's obviously been a volatile last couple of years in nitrogen this year, no exception. I mean, how is the nitrogen market faring for you right now, heading into the end of the year and i nto spring of 2024? Yeah. So we saw very strong demand when we launched our full program at the end of the summer. And we have also seen across, not just the North American channel, but I'd say channel inventories globally are greatly reduced. So most of the product that was in the channel found its way to ground. And so we're kind of in a rebuild the base level inventory in order to support next year's growing crop. And so there's, you know, there is strong demand out there. Additionally, we believe that India is gonna have to tender a couple more times here in the next couple of months, and Brazil is a bit behind. So I think all of that sets up really well for us in terms of what 2024 looks like, at least in the first half. The fact that you've got a continued wide energy spread between North America and Europe and North America and Asia suggests that production issues will continue to remain problematic in some of those other regions. So for all of those reasons, we believe that we're setting up for another strong year in 2024. When we think of supply and demand, nitrogen, like, there's some moving parts, right? There's been more Indian productions, speaking of tenders there. There's definitely some uncertain Chinese export supply, though the experts think will be kind of flat for exports next year, but who knows? The changing cost bases. How do you at CF plan all around this? Yeah, I mean, our expectation is China is gonna be somewhere in 3 million-4 million tons of exports, kind of year in and year out. And in fact, the world needs those tons. I think the years where they're up in the high single digits or double digits are behind us. You know, that hasn't happened since I think you have to go back to 2016 or 2017 to see that kind of behavior. And we don't expect that to come back anytime soon. You know, we spend a lot of time thinking about what the global density looks like from the standpoint of what are production economics in the different regions, depending on whether you're talking about anthracite coal, naphtha, natural gas, you know, various pricing hubs around the world. And all of that goes into kind of our thinking in terms of, you know, what appropriate values are for different forms of nitrogen. But, you know, because we're sitting where we are at the very low end of the cost curve, our plants are gonna run 24/7, 365. It's a matter of, you know, how do we maximize product mix and how do we maximize pricing in order to really get the best overall result possible. But our, you know, our plants are gonna be running full on. Okay. Let's talk about you... You know, a big part of your earnings, you know, is really the very low-cost base for gas in North America, and where you, where you produce. You know, we've talked about the European gas premiums earlier in this chat. You know, I'm getting a lot of incoming. So I was in Europe last week talking to investors. We're getting a lot of incoming from investors, too, in North America. They're really now asking the question, you know: Will European gas premiums compress, you know, in 2026? People are looking at the future LNG dynamic. What is sort of your view on how sustainable this, what's called $10, you know, gas premium, is in Europe, and if that's, you know, the marginal cost right now in nitrogen? Yeah, I mean, I think we have a hard time believing that we know better than how energy markets trade. So we take a lot of information based on what the forward curves are for natural gas in different pricing regions around the world. And I think right now, if you look at where TTF and NBP are trading in 2026, you're still in the double- digit range, you know, $10-$11 range. I think you have to get out to beyond 2027 before you drop down into high single digits, but you never really see it compress down to, you know, so that it's competitive with North America. And the other thing I would add is there's about 15%-20% of industrial demand that's offline in Europe currently. You also have not seen any increase in European gas storage. So what you're really doing is kind of very much living hand to mouth in Europe from the standpoint of you fill up the storage, and you hope you don't suck it dry too quick before you're able to kind of continue to backfill. And in an environment where you either have a cold winter or you see some of that idled industrial demand come back, I think the demand and the draw on gas is gonna be very high. And so our expectation is, while you might see periods of time where the differential may compress a bit, you'll see a lot of spikiness in terms of volatility, in terms of where European gas trades, based on what the withdrawal rate looks like and how quickly they can then regas and resupply. So I think the notion that, Europe is gonna be long-term competitive with North America is, is one that's pretty challenged. You certainly don't see any conventional ammonia production plants being contemplated or announced in Europe, and you see a lot of those being thought about in the U.S. I think that's because both the resource base and the cost of gas in the U.S. is, you know, it's a large resource base and low cost, but you also have a very favorable regulatory climate in terms of the 45Q tax credit and so forth, with no real, corresponding cost of carbon here. That's not true in Europe. So I think there's a lot of reasons why nitrogen production in North America is gonna continue to be very attractive and, carry with it a great margin opportunity for producers over here. I think what's been interesting is, you know, I think, last time I looked last week, European nitrogen production is about a third offline. We, we follow it every week. I know Yara took off a small Italian plant, I think December, January. Do you think is Europe the marginal production for nitrogen right now, or it's kind of seasonal, depends where you are in the year? What are your thoughts on that? Yeah. So I, I think our recent count is something like 20 plants are either down or curtailed, representing about 35% of ammonia production. So it fits very well with, you know, with, with your roughly a third of it's offline. And, and I think that it really depends upon the plant and the location. So for plants where, you can bring in external ammonia cargos and you're upgrading it into AN and CAN, you see a lot of that activity going on because there's still an upgrade margin available. Other plants where they're making urea or UAN that require you to run the ammonia plant to make it, they're running those plants, albeit probably at somewhat of a reduced rate, but, they, you know, they are kind of living right on the borderline because the upgrade margin is sufficient to be able to justify burning gas to, to make ammonia, to be able to upgrade, but it doesn't provide you a lot of additional capital that's gonna be required at some point when you need to do a turnaround or big maintenance activities. So, you know, those kind of plants can continue to struggle along for a few years until they're facing very substantial capital outlays for turnaround activity. And then in a lot of cases, what you'll see is they just won't come back up again. So Tony, if you look at the cap allocation, you know, in this world with a forward ask curve, you know, as you described it, and this kind of math and the projects you can do, you know, you would seem to have a lot of excess free cash flow right now, for buybacks, unless you want to do a new, you know, a greenfield blue project. There's a lot of weighing the conflicting objectives there. How do you look at, you know, how do you do this to balance all these different objectives? Yeah, Joel, I mean, the good news here is I don't think this is an either/or kind of situation. Last Friday, we just closed on the acquisition of the Waggaman ammonia plant in Louisiana from Dow. That was a purchase price of, you know, $1.675 billion, and some embedded supply contracts. It has not impacted really our ability to execute our share repurchase program the way that we've wanted to execute against it. Similarly, when we've talked about doing a new greenfield project, we're talking about doing it with, you know, what essentially is almost a 50% partner. And so the capital outlay is only half of what a new plant would cost. Realistically, it's spread over about 4 years or 4+ years because you don't spend all that money at one time. Just rough order of magnitude, you know, if you're talking about something that is, call it $2.5 billion to build, 50% of that is, you know, $1.25 billion. And if you're spending it over 5 years, while that's still real money, it's not so much money that it's a, it's a either this or that kind of proposition for us. We believe that we can, if, you know, if the numbers look attractive and appropriate, we believe we could execute that kind of project and continue to execute our share repurchase program. I don't think it's a this or that. The fortunate position that we're in is to generate enough cash that we can kind of kiss all the babies. So I mean, you're not Nutrien. You're, you know, different parts of different businesses. Shareholders always has objected, and the management teams, you see them, you know, canceling or not canceling, deferring indefinitely their blue greenfield, blue project. When you saw that, what did you think about that? Well, I mean, a couple of thoughts came to mind, one of which is, it was a different technology that they were going down the path of, and one for which an integrated, autothermal reforming ammonia plant, doesn't exist today in the world as a freestanding integrated plant. And so I think that there are some, certainly, technical issues, that there are mass balance issues that, you know, that come up that you're trying to deal with in that sort of situation. It doesn't mean that one won't be built eventually, but, you know, I think that that is a risk aspect of that particular project. I also think based on the way that we have approached this in terms of signing up partners for equity participation in it, particularly those that are going to be end users of the product, derisks the project from our perspective because it both reduces the amount of capital outlay, and it also ensures that there's a home for those tons, and a home that is a new application and doesn't compete against, you know, the existing SMR balance in the markets we already serve. And so I think, you know, the project that we announced is something that is much lower risk on an ongoing basis to us and to our shareholders. I can't really speak to the details of, you know, how they were thinking about their project and what led them to defer it. But, you know, those are things that we feel very comfortable about vis-à-vis our project, which is we think we can manage the risk of it appropriately. That was good compare and contrast. I appreciate that. So I mean, if we look at kind of what you think of your free cash, kind of runway free cash flow and EBITDA going forward, I mean, obviously, commodity prices move around, but in your world of, you know, double digit premiums in Europe and gas, looking at your sensitivity tables, I mean, you know, the streets, I'm gonna ask you to predict, actually I'm not going to ask you to tell me, of course, EBITDA guidance, you don't do that. But the streets, I think, projecting you at mid-twos EBITDA next year seems in line with the kind of gas profile you're talking about. I mean, are you comfortable, just in general, how the street sort of puts your earnings power at going forward? I mean, I think that one is very much a question of what is the gas price that you feed into it and what's the forward strip that you put in for, you know, urea and associated product differentials off of it. I think there's a lot of data points that you could feed into it that would give you numbers in that range that would not be, you know, crazy assumptions one way or another. Obviously, what we saw in, you know, 2022 was dramatically above that. What we're seeing this year is more in line with what you're talking about. I think going forward, some of the things that make us very optimistic that may not be fully accounted for in terms of market expectations, are things like the EBITDA and cash flow that's going to come off of the Waggaman facility, which is now officially ours. The cash generation that's going to come out of the Donaldsonville dehydration compression, you know, blue project, which is going to start midway through 2025. Those things have not really, I don't believe, been manifested in our share price yet. And so I think that there's some good upside there once those things actually start being reflected in the financials and are shown to be very current streams for us. Okay. About a minute or two we have left, Tony. I mean, you may have just answered this. Now, what do you think is most misunderstood about CF in the market? Or, you know, that you think hopefully in time you'll be able to, you know, turn people around on it? And I guess my question, Yeah, I mean, I think in these kinds of businesses, cost position matters a lot. And we're sitting in with our production in an area that's going to have some of the lowest- cost feedstock available to us. And even if the differential, you know, at times compresses a bit to other regions of the world, it's never going to be as low as it is here. On top of that, we end up getting about 10 points of additional on-stream factor or productivity out of our plants than everyone else in the industry does. And you know, what this means is about 10% of our production effectively is at variable costs only because the other 90% already carried the full cost of the plant operation. We are the best type of operators of these plants in the world because of our on-stream factor. We're sitting in the lowest cost region that's currently import- dependent from a nitrogen nutrient requirement perspective. We also get the benefit of an in-market distribution network. And we've got, again, these additional sources of cash flow and earnings that are coming our way through Waggaman and through the CCS project. I think, you know, when you look at all of those things, sure, you know, there's always volatility in commodity businesses like this, and things go up and down. But, you know, at the end of the day, we're in the best position on a global basis. That's great, Tony. Appreciate your time. Sorry, everybody for our late start today. Just a tech issue that we resolved. Thank God we got Tony on and, thank you very much. Joel, thanks very much. Appreciate the chat with you.