Energy's President and CEO, Clay Gaspar, joining us today. As many of you know, Devon is a really important company in the Oklahoma City community, in the broader Oklahoma City area. I am sure, Clay, you are pretty excited about a win for your hometown. What are you talking about exactly, Rick? The thunder. I hadn't noticed that. Oh, the Thunder. Thunder, you say. You may have an interesting, shy data point you could provide, but I'll leave that to you. Anyway, again, thanks for joining us today at this year's conference. You know, we hosted a Fireside Chat series recently, and I can't tell you the number of investors that joined that event. I think that Devon had one of the more interesting updates in Q1 on a really interesting Business Optimization Plan that Clay and his team are leading. We'll talk a little bit more about that. Clay, before talking more about the micro, you know, I was wondering if you could talk a little bit about kind of the macro picture, maybe start with a few introductory comments. Yeah, so thanks for that, Arun. You know, first of all, I want to start, I think our team is really strong. And I think the good news is Shai's about to resign. Are you talking about the Thunder? Are you talking about which macro? No, all kidding aside, it's exciting. I mean, in a place like New York, you know, the Knicks could win the whole thing. And it's maybe the 75th most important thing going on in the city at one time. In Oklahoma City, I mean, that's really a big deal. I love it for the community. I love it for the state. We were at Game 7. My family was there. You know, you just walk up, you know, the governor walks up to you and hugs. In fact, he saw my son first, hugged my son, was like, "This is awesome." My son's like, "Awesome, Gov. You know, we got to dap it up." He just, so anyway, you know, it's a little different vibe in the world of Oklahoma and kind of the context. We can't help but get excited about being good community partners. We were founding partners for 17 years. You know, to finally win the championship, it's really fun. I'm a little jazzed. My voice is still a little bit hoarse. Anyway, it's exciting. Flipping over to the other macro, the macro macro, you know, there's so much, I would call it dynamic, maybe the most positive spin I can think of what's going on in the world today. I think it's really important in this business to make sure that you start whatever the complexity du jour is with a strong foundation. That starts with a strong balance sheet. We've maintained a strong balance sheet. We continue to work towards chipping away at that, paying down debt. We hover about one turn right now. We'll continue to work on the $2.5 billion paydown target that we have. The good news is we're generating very significant free cash flow, roughly about $2.5 billion this year. You know, first call on that is our fixed dividend. You know, second is continue to chip away at this balance sheet, which we feel really good about the process that we're going through on that. Look, there's an opportunity for us to continue to buy back shares. We're taking advantage of that as well. That is kind of the foundational piece. When you think about the near term, the headline du jour, oil price du jour, it can really be almost like a head fake. It is changing by the minute. I think for me as a leader of the organization to try and, you know, respond to the news of the day is completely futile. I try and keep an eye on the horizon, look through the current fog, make sure that the fundamentals are there, starting with the balance sheet, compounding with a really strong portfolio, and then most importantly, a team that is in a winning posture. Thinking about how do we excite the organization around continuing to raise the bar. That is what we have done with the business optimization project that we announced a couple of months ago now. The focus is free cash flow and the sustainability of that free cash flow. We've got our eyes set on a billion dollars of incremental free cash flow for the organization. Again, on top of the incredible runway of free cash flow we have today. I think it's fundamentally important. I think the absolute number itself is incredibly impressive. We're going to accomplish this by the end of next year. That timeframe is incredibly important. I think some of the hidden benefits that come from this are equally important. The culture of winning, the culture of benchmarking, always looking back, raising the bar, making it not just comfortable, almost expected and mandated that we ask ourselves constantly, how do we do it better? That is, to me, the hidden byproducts of this business optimization project that we're so excited about today. In the meantime, we'll continue to watch the macro, try and, you know, answer the questions. You know, two months ago, hey, you're going to rig, you know, oil prices down. Before that, oil price was up. How are you going to respond to this? You know, oil prices back down relative to last week. How are you going to respond? My answer remains steadfast. We're looking through the front month curve. Honestly, the incremental capital decisions that we make today have zero impact to that front month. We're out looking 18 months ahead. When you start looking at kind of the back end of the curve on these commodities, it remains relatively steady. That helps us not take the current head fake of $75 or $55 or whatever it is of the day and look past some of those things. Clay, one of the industry talking points at one Q was this notion that we may have reached a peak shale output on the oil side in the U.S., just given inventory exhaustion, declining well productivity, and just, you know, broader industry decline rates. Firstly, do you think that we've hit peak shale in the U.S.? What do you think the bigger picture implications are for the Global Macro for oil and Devon in particular? Yeah, that was one of our peers, Diamond Back, that called for that. I respect the heck out of that organization, that leadership team. I would say, in my view, that's probably called a little bit early. I think we continue to grow even in this environment. The momentum, the quality of the assets. Again, I'll go back to the most important thing is the quality of the teams. This is speaking above and beyond just Devon. You know, the innovation that we've been able to apply to this incredibly opportunistic resource, thinking about long laterals, these creative well designs, just getting better at applying technology and eking out a little bit more of the resource that we have underfoot today. I'm not betting the under on our industry's ability just to continue to get better and have that accrete into continued growth. Now, when I think about Devon, I'm often asked, you know, how do you think about growing versus shrinking versus capital maintenance? We're essentially in a capital maintenance program, about 385,000 barrels of oil per day, where we're really focused on trying to maintain that, keep that pretty level loaded. What that means is, in this business optimization, as we accrue more efficiencies, we're going to accrue that on the capital side of the equation rather than the production side of the equation. Let me explain. Last couple of years, as we've gotten more efficient, that's done two things. One, it's brought in more production per capital, that capital efficiency. There's an accordion effect that drags first quarter capital investments into fourth quarter of current year. What that can do is put a little bit of capital pressure on the system. In the prior years, we've absorbed that capital, and we've accrued the benefit to the production. We've outrun production, beat and raised constantly over the last several quarters. What the new change in messaging is for this year is, as we continue to accrue operational benefits, those first quarter dollars getting pulled into fourth quarter, as it happens when you move more efficiently, what we're saying is, we want to hold the line on capital, and, excuse me, yeah, hold the line on production, and then let the benefits accrue on the capital side. Last quarter, we announced a reduction of that $3.9 billion target to $3.8 billion for the midpoint. I expect that to continue to move in a positive direction as we get better and better and, again, allow those efficiencies to make us a little bit more capitally efficient through the capital side of the equation rather than the production side of the equation. By the way, that is a little harder to do, easy in the spreadsheet, a little harder to manifest in the field. Yep. Clay, post one Q, just given some of the tariff impacts and some of the global macro uncertainty, a number of your peers decided to cut activity or moderate activity. Devon made the decision to stick with its activity plans. You did talk about cutting about $100 million of capital. Why was that the right decision for Devon? We do note that commodity prices have improved since that time period. Yeah, improved and then fallen back again since you've written that note. Yeah. I will go back to, boy, it is so easy to get spun up on the day's headlines. I think the real, much more important and much more beneficial view is to look through the current fog of that front month, not get too spun up. I mean, we're just at $78 oil and, you know, just before that, $58 oil. Trying to react to that is absolutely futile. It just makes no sense. It hurts you on several fronts. Number one is confusing the organization about what's the North Star, what are we focused on, what are we driving for. For us, sustainable free cash flow, durable sustainable free cash flow is what we're driving towards. We are clear on that. Number two is you think about operational efficiencies. I have some of my operational partners in Liberty and H&P in the audience. I think about N9 Energy as well. When I think about the confusion of, guys, we're dropping activity, we're dropping rigs. Oh, I'm sorry, before we drop, let's add that back up. Now we've got new crews. We've got the volatility that it causes our service company partners. That is where inefficiency, safety issues, environmental issues really come to root. Our ability to be consistent and, again, eye on the horizon and long sighted on this helps us on every part of that value equation. Yep. What about natural gas? You know, Devon also has a significant supply base of natural gas. Could you talk about some of your assets that are leveraged to natural gas? And how does the company look to take advantage of what looks to be a pretty robust macro setting through the end of the decade for natural gas? Yeah, let me go back. I forgot to mention one thing on that last question, Arun. We have been running maintenance capital. I talked about just a few minutes ago was a flat 385 on the oil side. We are basically flat, maybe just a touch of growth with that cadence in mind. I have articulated we are not looking to grow that incrementally. We are looking to save on the capital to be able to continue that maintenance. Some of our other peers were actually growing in this market. When they have actually reduced activity, I think they are reducing to the point of maintenance capital and essentially that flat production over the years. In my mind, that is where we already were. Some of our peers are kind of catching up to the position that we are at. Think about that one and store that one away as the moves that they have made have actually moved towards where we are at today. How are you, Sharif? Good to see you, brother. Back to your gas question. We have great, you know, I really believe in diversity of our assets from a geographic standpoint, but also from a commodity standpoint. When we think about about 50% rough numbers, oil, 25% gas, 25% NGLs, I think all three of those, you know, will have their day in the sun. Our ability to move capital around to mimic the needs of the market, I think, is a net benefit to us. As we have tested the volatility of oil price and gas price and that relative response over the last few years, it has constantly pointed us back to the oil molecule is going to dictate the economics. That is going to really drive our decision making. Now, as you march through our inventory over the next few years, we're drilling about 450 wells every single year. You know, you get back into a situation where gas relative to oil, maybe you get back to this kind of 10 to 1 of an $8.80 environment. Maybe that changes. We have the opportunity to reallocate capital specifically in the deeper Delaware Benches and then also in the Anadarko Basin. We have those capabilities. We do not see that the current commodity price is causing us to shift that activity today. Great. How do you characterize the current A&D environment for E&P assets? I think volatility is an enemy of consolidation. And so, you know, you think of it this way. For two companies to come together, typically you need a correlated, unified, similar view on the forward curve. If somebody sees $80 and another person sees $60, it's kind of like the deal's over. I just don't know how you even get to the finer points that are really hard of valuation of this asset or upside in this basin, kind of the relative field. So I think that volatility is an enemy to consolidation. Generally speaking, I'm still very pro-consolidation. I think, you know, we're in a commodity-driven business. We're in a maturing resource play world. What that tells me is, I think Travis Dyce says it well, the barrel per CEO is still out of whack. I think that can be more efficient in time. And we fully support that. Look, we want to do the right things for the shareholders. We want that efficiency to accrue. We want to be the ones that should be viewed as the natural consolidator to the innovators. In doing so, I think this business optimization project gets us closer to that point. You know, that is where, you know, we're going to be more efficient. We're going to be the best stewards of the resources. We're thinking holistically about how do we create value, not just in the near term, but also in the long term. I think that's the winning recipe. Okay. Let's switch gears and talk a little bit about the business optimization plan. Can you provide some of the key nuts and bolts of the program, including your cost and margin improvement targets for this year and next year? Yeah, we could spend, you know, our allocated 30 minutes just on this project. But when I think about, you know, being a new CEO, you know, one of the things we wanted to have was that rallying cry for the organization. What I sensed was the organization was hungry to be hungry. Like, what is the thing? What is the thing that we're going to go after? And so rather than something a little bit more tactical like production, that is the bloodline of what we do and how we create value as an organization, we want to be a little bit more holistic. And so we wanted to excite every nook and cranny of the organization to think about how do we do things better. And so we put four tenets out. It's an incremental billion dollars of free cash flow per year by year in 2026, okay? We have timestamps for what we are going to achieve in 2025, what we are going to achieve on average for 2026. We will have this big celebration at the end of 2026 when we achieve that. Those four categories really encompass all parts of the organization. Yes, some of it is capital. We think about the operational things that we are doing, you know, really leaning in on Simulfrac and some of the value creation techniques. How do we apply technology to how we drill wells? We are continuing to drill faster. You know, what is that knowledge from bit to compute and how do we connect those dots? How do we think about, on the second category, production? How do we think about downtime? How do we think about base declines? That does not get near the airtime that it deserves on value creation. If you can take our mid-30s kind of base decline and just tick it up a couple of percentage points, that is a huge value creation opportunity. How it manifests from the capital side is that maintenance capital becomes that much lighter. When we think about extrapolating the wins, we think about accruing again to the capital side of the equation. Even that production piece, that maintenance capital, excuse me, the maintenance production work makes that lift that we need to do to maintain that production capabilities that much easier. There are things like from the commercial side. We were already negotiating, you know, these aged out kind of 10-year deals looking for how do we renegotiate these things for the next decade. What we saw was an alignment of several of these very meaty projects kind of coming in either now that we've already been negotiating or in the coming years. What we're doing is we're proactively reaching out and saying, look, here's what you need from us as additional certainty. What if we went ahead and we're only in year eight of a 10-year deal. What if we signed up for another 10 years today? How do we lower that fixed cost? Because they've paid out on the initial installation, the build-out, kind of that first tranche at 10 years, it's pretty expensive. That second 10 years of maintaining all of that equipment is a significant step down. How do we proactively reach out, work with our partners, drive that cost structure down? I can tell you it's a huge needle mover for us in that GP&T. The final category is corporate costs. While some of our peers have really pointed to, hey, we're going to cut this much out of G&A and this is how we're going to win, I can tell you we don't have a billion dollars to cut in G&A. We don't have a billion dollars in G&A. It's a contributor. Things like technology, organizational structure, some of the efficiency things, you'll see that accrue as well. There are other corporate costs. What we really wanted to do was from everyone in the organization, how do we think about contributing to this bottom line? That's what gets me really excited is some of the big things, you know, the marketing guys are going to be able to do these $100 million big tranches. There's a couple of really, really big deals. I think the organizational mentality around that hunger for that next nickel, dime, quarter, dollar should be for everybody in the organization. I think the value creation from that mindset, that cultural change has as much potential going forward as the dollars from some of these big deals at the beginning. Great. There are four major buckets. You got capital efficiency, $300 million, production optimization, $250 million, commercial opportunities, $300 million, and corporate costs, $150 million. Can you just maybe provide a brief overview of, you know, some of the opportunities that you see to really improve your free cash flow profile? Yeah, I think, again, those are the four categories. I kind of touched on those. We could go into depth. In fact, in our latest slide deck, we talk about each of those four categories. And then we spell out, I don't know, it's about eight bullets for each one of those. I could highlight some of the things. What I would tell you is there are undertones throughout it. One of those is technology. One of the organizational changes we made is we promoted the Chief Technology Officer to be part of the executive committee. He's a direct report to me. We have these, you know, this is the sessions that we do the hardest problem solving in the organization. What makes it to that team are the big needle movers, the hardest things, the things that we just can't delegate throughout the organization. We typically meet Monday afternoons. We have a great session. All things come to that room. Trey Lowe is this gentleman's name. Trey's contribution is every problem that comes to that table, he thinks through an opportunity of how do we drive cost structure, operational improvement, efficiency, productivity through the lens of technology. HR issue of the day, you know, some other thing going on around the company, you know, weather, whatever the thing is, how do we think about the technology lens and is there a technology solution, you know, associated with that? To me, that's what the incremental voice in the room, that diverse set of experiences and lenses, that's when the machine is working. I'm really excited about what we're doing. I've been to a couple of outside of the industry events really focused on AI. I'm an absolute AI geek and lover. This is, you know, this is the industrial revolution of today. And so when I think about, you know, where we sit and the opportunities are abound, every one of those categories that we talked about and every one of those sub-bullets have an undercurrent of technology as well. We're winning on that front. I really have been surprised going into these conferences because I just don't think we're moving fast enough. Walking out of these conferences, I've been pleasantly surprised, like, wow, we are quite ahead and we are moving really well in this space. Still, I mean, we're just scratching the surface of what this can be. And I think that's a real game changer for all industries. And we're certainly part of that. Yeah. Maybe last question on this topic is what have you achieved thus far of that billion-dollar target? $100 million, I think, in CapEx is something that you've already mentioned. But what is already that you've achieved? Yeah, again, we've got this spelled out in the slide deck. And we'll, you know, first order and a commitment from me to you on every quarter coming up, we will be updating those bar charts on here's where we're at, here's how we've progressed. Internally, kind of behind the scenes, we have it much more delineated as you would imagine. And we've got, I think it's about four different categories of things that are in-house that are signed up that we are seeing the benefit from today. Second category is something along the lines of we've signed, but we haven't started to see the benefit yet. Third category is we're in negotiations, we feel really good, but we haven't really captured that yet. And the fourth category is these are ideas, not yet negotiated, not sure they're really going to ultimately come through. When you stack that whole bar chart up, we exceed the $1 billion target knowing that some of those things in that fourth quarter, fourth category are not going to actually come to fruition. What I'm excited about is we're literally like two months into this project. That's a stated goal, not just of the 18 months ahead, but this is the new mindset going forward. When I think about the runway of options going forward, I think the number, the top line number continues to grow. In our last deck, we've talked about some of the GP&T deals. Again, I mentioned this. We had been negotiating these for quite a long time ahead of this. We've gotten those signed up. We're starting to see the benefit. Certainly by January of 2026, we'll see a lot of those values come through. As you mentioned, our capital, we've already drawn down the capital, midpoint of capital, $100 million. That's in a direct benefit there. I also want to mention, because sometimes this gets lost in the translation a little bit, there are things that we're not including in this business optimization. The two big categories that come to mind are, number one, deflation. I don't know if we're in a deflationary environment or an inflationary environment. You have to check, you know, today's oil price. If we do benefit from a deflationary environment, that's above and beyond. That's a different category. We're going to do our very best to try and separate that out because it's just, it's a different set of potential wins or losses in the case of inflation. The second thing is we recently transacted and sold our ownership in a pipeline called Matterhorn, moved from the Permian to the Gulf Coast. That was a huge win on a few fronts. The most important win is we got the pipe built. We continue to maintain the capacity in that pipe. And as you know, getting gas out of the Permian Basin is exceptionally high priority. Because we were an early partner on this project, we were also offered an opportunity to ride along on the capital investment. That's been a grand slam investment. We recently transacted and sold that for $370 million, our very small investment. So it was a nice multiple return. That is not, that $370 million or the net profits or any of those things, that does not go to the billion dollars. That's a separate category. That's a home run, a nice win. This is a separate, again, benefit to the organization. I just, we're trying to keep the purity of this billion dollars and holding ourselves accountable to delivering that to you guys. Okay. Let's shift gears, talk a little bit about the portfolio and operations. You guys started the year strong. You had a good 1Q. You bumped your production guide and you cut CapEx. I'm sorry, say that again. I couldn't hear you too well. Can you talk about, so good capital efficiency, what are your thoughts on kind of sustaining that strong operational performance in 1Q over the balance of the year? I think we're just, I think we're just getting started. I mean, there's just so much, you know, upside from where we're at. And that's in all of the categories. You know, how do we, what I like about this business optimization, again, it's not just a, hey, drilling engineers, how do we drill faster? How do we drill longer? How do we drill better? It's not just geologists. How do we, you know, delineate the field and understand where the fault blocks are that much better? It's every part of the organization contributing to the bottom line of the organization. Now, there is, it's a hard business. This stuff is always challenging. And I don't, you know, make light of that next innovation step. It's incredible. It's nothing short of a moonshot. What the resource plays have done for the U.S. economy, about $3 trillion of stimulus to the world economy, $9 trillion of stimulus. What that means, what it means to national defense, what it means to human prosperity, all those things are monumental and historic undertakings. As we continue to roll that forward and we start thinking about what's the art of the possible continuing to go, I can tell you, I've quit second guessing our industry and our company's ability to continue to innovate. Now I think with the technology and specifically AI kind of overprint, I don't know how far it can go, but I would bet on the over on our ability to continue to innovate. Now we're working against, so there's that operational innovation. It's working against a portfolio that is maturing. All across the land, all of these resource plays are starting to get kind of the mid-innings, maybe the beginning of the latter innings of where we are at on the full spectrum of the portfolio. To date, that innovation on the operations has significantly outrun the quote portfolio degradation. In fact, the productivity has maintained and gotten better and better. I would say over the last few years, it has probably plateaued as an industry. At some point in the future, we will see a point of diminishing returns where the operations cannot outrun that portfolio degradation. That is just the reality and the nature of resource plays and any subcategories of our industry over time. We are fully prepared for that. We understand that. We think that is a decade out. We feel really good about where we are at. We are thinking about above and beyond the current portfolio. How do we continue to innovate, amend, and extend the portfolio that we have today? In the meantime, I will go back to that business optimization. First and foremost, we need to get better every single day at what we do. I think we are making great progress on that. Great. I want to quickly talk a little bit about efficiency gains. 7% year- over- year in the Delaware on drilling, 12% on completions. How much more is there to go? Yeah, it's a great point. The numbers you're quoting are 25 over 24, so seven and 12. Last year, 2023 to 2024, we were 15 and 15% efficiency gains. Okay? Man, you go back years before that, we even had some bigger numbers. How does that manifest? It's how many dollars are we putting in to drill the same number of wells or maybe even more importantly, the same number of lateral feet. As we're drilling longer laterals and there's a lot of innovation in that space, that accrues to the bottom line. If we can get four miles of lateral delivering production, you know, in one fell swoop, that's just more capitally efficient. That's a great thing. On the completion side, same thing there. Innovations like Simulfrac, you know, being able to stimulate two wells at one time and having that operational efficiency just accrues to the bottom line. Those are the big headline things. Everything that people are talking about and are the big needle movers. What I would tell you is one layer deeper into the onion, there are so many things around innovation. It is facility design. It is the time motion studies with literal stopwatches on how long does it take to make a connection on the rig. If that is a two-minute process, how do we shave seconds off of that? Because that is something we do thousands and thousands of times on that one pad. How do we get, you know, that level of precision? Those are the kind of wins that we are continuing to have and really accrue to the bottom line. Clay, we're out of time. I had a bunch of more questions, but we'll have to get to these at another time. Really appreciate your time today. Absolutely, Arun. Thunder up.