Exxon Mobil Corporation (XOM) Q3 2011 Earnings Report, Transcript and Summary

Good day, and welcome to this Exxon Mobil Corporation Third Quarter 2011 Earnings Conference Call. Today's call is being recorded. At this time, for opening remarks, I'd like to turn the call over to the Vice President of Investor Relations and Secretary, Mr. David Rosenthal. Please go ahead, sir.

Good morning, and welcome to Exxon Mobil's Third Quarter Earnings Call and Webcast. The focus of this call is Exxon Mobil's financial and operating results for the third quarter of 2011. I will refer to the slides that are available through the Investors section of our website. Before we go further, I would like to draw your attention to our customary cautionary statement shown on Slide 2. Moving to Slide 3, we provide an overview of some of the external factors impacting our results. The global economy and energy markets continued to face a challenging macroeconomic environment. Global economic growth was mixed in the third quarter. The United States GDP in the third quarter is expected to show some modest improvement from the second quarter, while economic growth in the European Union continued to slow amid persistent sovereign debt concerns. In general, Non-OECD growth remains robust even with some signs of demand softening in China. Energy markets overall continued to weaken in the third quarter versus the second quarter, with both crude oil and natural gas prices declining. Commodity chemical margins also weakened across the quarter. Turning now to the third quarter financial results, as shown on Slide 4. Exxon Mobil's third quarter 2011 earnings, excluding special items, were $10.3 billion, an increase of $3 billion from the third quarter of 2010. Our effective tax rate for the quarter was 47%. Earnings per share for the quarter, excluding special items, were $2.13, up $0.69 from a year ago. The corporation distributed more than $7 billion to shareholders in the third quarter through dividends and share purchases to reduce shares outstanding. Of that total, $5 billion was distributed to purchase shares. Share purchases to reduce shares outstanding are expected to be $5 billion in the fourth quarter of 2011. CapEx in…

[Operator Instructions] We'll take our first question from Doug Terreson with ISI.

Global E&P profitability seems to be rising, especially overseas, which appears to be offsetting some of the weakness in the U.S. So my question is whether you could provide a little bit more insight into the upstream profitability trends, and that is in relation to the level of realizations or margins that there -- that may be called. Meaning, are there other international mix effects besides the ramp-ups in the 3 countries you mentioned? And in the States, are the trends assemble at lower oil but higher gas, production-related? Or are there other factors at work?

Let me actually answer those questions in reverse order. The impact you do see in the U.S. is a mix effect with some lower liquids production being offset on a volume basis by higher gas production overall as we've trended in the last year or so. And you've see that impact on our volume mix effects. Overseas, I would say most of the changes that you see there is really the benefit we're seeing in the project ramp-ups, in particular, the Qatar trends, and you see that both in our non-U.S. profitability, as well as the strength of our non-U.S. gas realizations. So those will be the primary factors.

Okay, good. And then also you mentioned Natuna was progressing slowly but surely. And on Natuna, I wanted to see if we could a little bit more of a status update on that project and specifically, whether you guys feel the partnership structure is settled and also whether you believe current technology is present to effectively develop that project. Just a little bit of an update on that one.

Sure. Even though this project has been around a while and we've been looking at it, working on it, we're still in early days in terms of the definition of the project, the partnership, et cetera. I was pleased to report this morning that ExxonMobil, Pertamina, Total and PETRONAS have signed this principles of agreement, which will relate to the plan for exploration and development of the area. So while the POA is a good first step, I have to say we're still kind of in the early days of bringing that project along, and those negotiations for the final PSE are ongoing.

And we'll take our next question from Iain Reid with Jefferies. Iain Reid - Jefferies & Company, Inc., Research Division: I wonder if you could give us an update on the Rosneft deal. In particular, where are you on negotiation, the tax terms? Is there any kind of special tax breaks that you're looking for in order to make this project work? And also, I think you are going to swap some assets with Rosneft in the U.S. Is there any kind of decisions being made in which particular assets you are going to do that deal on? And I've got a question on chemicals after that, if I can.

Sure. Let me hit both of those questions on that strategic cooperation agreement. In terms of tax terms and other issues around the definitive agreements, I can tell you, work on those agreements is progressing on schedule. We're working very closely with Rosneft on that deal, and that's progressing. I can say in terms of, in particular, on fiscal terms, the Russian government does recognize the need for fiscal improvements in the offshore, and we are working with them to define how that might end up at the end of the day. But I can't give a specific time frame for the finalization of those agreements other than to say work is progressing. In terms of the second question, I wouldn't refer to it as asset swaps necessarily. I think a better way to portray it is Rosneft will be given the opportunity to participate in various properties in the U.S., for example, in the Gulf of Mexico, in the Deepwater they'll have an opportunity to farm in to some of our 100%-owned blocks, and they are evaluating those opportunities to make a decision. They may also take an interest in some of our unconventional resources in the U.S., and they're looking at that as well and what those opportunities might be. There was also potential for cooperation and joint partnership and other pieces of the business overseas. But again, those have yet to be finalized. I will say that we're looking forward to the multiple joint ventures and personnel exchanges that we're going to see in this agreement. And I think this will help really strengthen the relationship between the 2 companies, as well as provide valuable development opportunities for our staff. So it's kind of as the title suggested, it is a strategic cooperation agreement, and that includes technology development that we've also talked about, including the Arctic research center. So a number of things going on. And I would say, again, early days, but things are progressing on schedule Iain Reid - Jefferies & Company, Inc., Research Division: Okay. And my chemical question was, you talked about margin weakness during the second and the third quarter. Is this the kind of a global GDP slowdown, thing you're seeing in Asia or the OECD? Or where is that kind of bit of weakness coming from do you think? And do you think this is something which will extend into the fourth quarter and into next year now?

Well, let me hit the first part of that. As we've look at margin trends sequentially across the last couple of quarters, we are seeing demand weakness overall and that has backed up into some downward pressure on margins. Asia is probably at bottom of cycle, if you kind of look at historic trends. But we've also seen some weakening demand and margin pressure in Europe as well. Back, again on the Asia side, there's a little bit of oversupply across some of the commodity products, and that's pressuring margins. So once again, we're reminded this is a cyclical business and the profits that we're earning now are certainly very strong given where we are in an otherwise pretty weak economic environment and in particular, on commodities. Although I will say on the specialty side of the business, that business is holding up pretty well, both from a volume and a margin standpoint. And we look at earnings decline across the last few quarters, most of that has been in the commodities section, as the specialties business has held up well. So as we look forward in the fourth quarter and next year, it's hard really to judge what's going to happen, although I will say as you would expect, there'll be a close tie between economic activity levels and certainly, the profitability of the commodity side of the business.

And we'll take our next question from Evan Calio.

First question on the U.S. unconventional portfolio. I know last call you mentioned you were earning 65 to 70 rigs. Can you update us on the rig count this quarter? And secondly, as the commodity strip has come down very different than oil on the natural gas side, how do you consider any activity response to the environment or can you quantify -- I know you highlighted Woodford, Ardmore and Utica, I mean, can you quantify your shift within that portfolio towards liquids? And I have a follow-up on the Black Sea.

Sure. As you mentioned, the environment has weakened a little bit on gas prices here in the U.S. I can tell you across the quarter, we're averaging right around 64, 65 rigs in the unconventional space about what we've been doing over the last year or so. I don't have a quantification of actual rig movement. But I can tell you, as you would expect, we have optimized that rig count towards the liquids-rich plays and ramped up there. And certainly, in terms of keeping the overall total flat, backed off on some of the dry gas areas. So in particular, as I mentioned, some of these new plays that we're in, we're anxious to ramp up drilling activity there and are doing so. So yes, I think, just as you would've expected, we are certainly optimizing that rig count towards the liquids-rich plays, and in particular, some of that newer things that we're working on.

Great. That makes a lot of sense. Just a follow-up on the Black Sea questions. In terms of the onshore or offshore assets that Rosneft, while the option to farm into, is this primarily an acreage opportunity? Or is there associated production potential as well? And you didn't mention any time on Kara. Kara, you mentioned seismic this year. Is that also a 2014 timetable at the Black Sea?

Yes. Let me just kind of clarify. In the Black Sea, we've got seismic underway now, and we look to potentially drill a well in 2014. When you go up to the Kara Sea, we would expect to begin the seismic operations next year, and then potentially, if things work out, drill a well in the 2015 time frame.

Got it. And any update on the Kastamonu well? I believe -- Is that still drilling in Turkish Black Sea?

When you look at the Kastamonu well was our first well. We have finished drilling that well. I can tell you that we did not encounter commercial quantities of hydrocarbons. We plugged and abandoned that well. And we did take that dry hole expense in our earnings this quarter. I can also tell you we continue to evaluate the results of that well and the well we drilled last year, as we look at kind of the overall play there. I think as you look out across the next several months. Our plans in the Black Sea are -- once TPAO is finished, they've got the rig now drilling one of their blocks. We'll then take the rig up to Romania and drill our first well. Whether we'll get that spudded at the end of the year or it rolls in to the first year -- the first of the year, we'll see. It depends on timing of the return of the rig. But that'll be the order. We'll drill Romania next, and then we'll evaluate based on the results and what we're seeing from our evaluation of the earlier wells, what the go forward plan is there.

If I could just slip in just one other. I know that on that Hadrian discovery, large discovery. I know you were testing a deeper objective. Any update there?

I'm glad you asked that because I do have an update on that for everyone this morning. We have finished the well. We drilled to TD. And I can update for you now the pay that we have logged is now 1,000 feet. So I think if you look at kind of how we've gone, we initially talked about 500 feet, then we updated it last quarter to 750 feet. And I can now confirm that well has encountered more than 1,000 feet of net oil and gas pay. And we are progressing plans for additional drilling, as we continue to evaluate what has turned out to be a very high quality prospective block.

That's great news. The development plans, we'll hear those soon?

We're working on it. And as soon as those things are better progressed, we'll talk about those. But at least for now, the news is good. And again, we are very pleased with the quality of this discovery in the Gulf of Mexico.

And we'll take our next question from Jason Gammel with Macquarie.

This is John Nelson for Jason Gammel. I was wondering if I can get any color on the 76,000 barrels per day of entitlement volumes that you lost in the quarter. Just curious if there was any particular region that stood out or if you could try and maybe quantify that.

Sure. The primary area there is West Africa. As it was, frankly, when you look quarter-on-quarter, but if you're looking specifically sequentially, you have the bulk of that is in West Africa.

Okay. And then just wondering real quickly. Did you have any -- could you quantify the out -- any out-of-period tax charge taken in 3Q for the change in the U.K. tax law?

Yes, I can give you an update on that. That number was less than $100 million impact on our earnings this quarter.

Less than $100 million including 3Q? Or is it simply for out of...

No, that would be the 3Q impact on earnings, just under $100 million.

We'll take our next question from Doug Leggate with Bank of America Merrill Lynch.

Just a couple of quick ones, if I may. I guess, going back to an earlier question on the strength of the international realizations, it's kind of my favorite topic right now. But can you just talk about the impact of Qatar this quarter? It looks like international gas realizations were flat despite a lower brand price. And I'm wondering if that was some kind of movement in the direction of the sales volumes after the downtime in Q2. And I've got a quick follow-up, please.

You hit it spot on, Doug. That is exactly what we saw, the impact of the higher volumes into the LNG market and then the impact on our overall realization that we saw internationally. So you got that right.

You think it's fair to describe that as a big factor in what's improving your international realizations?

Yes, I'd say that was the primary factor.

Okay, great. The follow-up I have is, really -- I don't know if you're going to be able to answer this one. But I know you and I have had discussions about Kearl in the past, and. Given we're getting pretty close, I guess, to seeing a startup next year, albeit at the end of the year that the economics have really come under a bit of scrutiny. And I wondered if you could just clear things up in terms of how Exxon sees the economics of Kearl and how it stacks up relative to some of your other projects, and I'll leave it at that.

Sure. No, Doug, that is a good question, and it stems from the discussion we initiated at the analyst meeting in March. I can tell you that as we've looked at this, that Kearl returns are within the range of all the projects that ExxonMobil participates in the deepwater Gulf of Mexico. When we look at the projects that we're involved in, in those economics and compare those to Kearl, I can confirm that the returns are going to be consistent within that portfolio.

Any perhaps update on the timing of the future expansions beyond Phase 1?

No, I can't give you the timing on the future expansion. As soon as we've got that thing locked down, we'll let you know. But we haven't made the final determination on that just yet.

We'll take our next question from Mark Gilman with The Benchmark Company.

Can I stick with the Kearl project for just a second? I wonder if you could -- given that you're 75% complete, give us an update on what the Phase I development costs look like, whether it's still along the lines of about 100,000 of daily flowing barrel.

Yes. If you look at, as I mentioned, that we are 75% complete and that's going along very well, in terms of the cost, they've not changed from what we told you in March at the analyst meeting, on the chart we showed. Those things are still the same as we mentioned at the time.

Okay. If I could follow up with just some PSE related stuff. Looks to me as if there was a tranche affect encountered in West Africa. Is that accurate? Was it Nigeria or Angola? Also you mentioned a lower entitlement in Iraq, which strikes me given the spending profile there to be -- just a bit curious. Hopefully, you could flesh that out for me.

Sure. We did have a tranche change in Nigeria and did impact a part of those volumes. And then I'm sorry, what was the second part of your question?

You had indicated lower entitlements in Iraq, which struck me strange in light of the spending profile going forward, as well as the price environment. Can you clarify what was going on there. Maybe even provide an entitlement production number for Iraq in the period.

Yes, sure. Basically, the situation in Iraq is quite simple. We became cost current last quarter, and so we were -- during the second quarter, we were catching up. And the production barrels that we had reflected that. And this quarter, those volumes have come down because we are cost current.

We'll take our next question from Paul Cheng with Barclays Capital.

Dave, a couple of questions. First, in the -- can you tell us what is the asset sales gain, the actual amount in the third quarter -- in the second quarter of this year and whether that they are primarily in the E&P segment?

You're talking about the divestment gains?

Yes.

If you look at our divestments, most of the gains that we've seen in the second quarter -- or in the third quarter rather were in the upstream. And also, as you look at the second quarter overall, we did have a series of divestments in the upstream and also some in the downstream. I think the place you really see the impact of the divestments this quarter, without giving a specific number, but it's the biggest driver in the -- if you look quarter-over-quarter and then even sequentially in the other factor on our earnings waterfall chart there, the primary driver of those positive results are the divestments that we had over the quarter.

So it's roughly about $400 million sequentially higher asset sales gain?

No, that's the total in there. There were some asset sales gains in there, but there were a number of other factors. We had some favorable ForEx and then we also had the increase in exploration expense. So again, without quoting a specific number on the asset divestments, I can tell you, when you look at both of those waterfall charts, that is the primary driver of the positive impact.

Because the second quarter does have a reasonable, sizable asset sales gain also, right?

Yes, we did have some asset gains in the second quarter as well.

Okay. And then when you're talking about foreign exchange, the unfavorable impact, are those related to the translation of the balance sheet? Or is it actually on the cash earning due to the impact on your costs, as well as the translation back to the U.S. dollar when you are in on the revenue side?

Yes, the primary impact that you see in the downstream on the unfavorable ForEx I mentioned is really the impact on the U.S. dollar accrued payables that we have in the downstream.

Okay. So you saw on the balance sheet item?

Yes.

Okay. Can I sneak in maybe just one final one?

Sure.

You're talking about the production and driving into the shale oil. Is there any number that you can share? What is your current well cost that you guys running in Bakken, Woodford and Permian Basin? And what is the GUR [ph] you're expecting and also the 30-day IP on those?

No, I really don't have any additional details to share this morning other than the ones I've mentioned in my prepared remarks. As you look at some of those plays, obviously, with the early wells that we're drilling and some of the optimizations that we're doing, it really wouldn't be representative to start talking about, I don't think, well costs and that sort of thing because our expectation is as time goes on, those costs are going to go way down. I think what's encouraging, though, is the significant addition we're making to our overall unconventional portfolio with the bulk of that here, as I mentioned this morning giving you an update on how we're doing on the liquids-rich plays as you might remember.

What is your total production in the third quarter for the shale oil?

I don't have a specific breakout number for that in the quarter. I can tell you it's certainly going up. I mentioned a couple of examples. So while it's a little premature to start talking about absolute volumes, I think the important thing for everyone to know is the activity is ramping up, the rigs are ramping up, the drill wells are ramping up, and we're progressing. I will give you a couple of examples. Just for example, we've added 38 wells year-to-date in the Bakken, with 18 of those in the third quarter. So I think that gives you a good feel of kind of how the activity is going, and once we get a little farther down the curve, we'll talk more about specific volumes.

We'll take our next question from Allen Good with MorningStar.

I just had a quick question on LNG and Golden Pass. It looks like this week there was some movement as far as the viability of exports from the U.S. I just wanted to get your thoughts and how Exxon views essentially LNG out of the U.S. and use there at Golden Pass and whether you're actually importing any LNG into the U.S. currently.

Yes, if you step back and look at the viability, first of all, just LNG exports out of the U.S., that is a topical discussion today, and a lot of folks are looking at it and talking about it. I don't think it would come to any surprise to you now that any marketing opportunity or development opportunity out there, certainly one that we're looking across the board whether it's in the U.S. or Canada. I can tell you, though, that Golden Pass is an LNG-receiving terminal, and there are no current plans to change that either -- into any form of an export terminal. So that's kind of the status there. We've not brought any cargoes in, and recently, that I'm aware of, into the terminal. But it does remain, obviously, a very valuable asset for us. Other than that, I really don't have any other comments to make. It will be interesting to see, as time goes on, if the viability of LNG exports materializes. But that's just one of a number of options that are out there.

Okay. And then just a question. I think last quarter, you mentioned that drilling in Argentina would start in Q4. I just wondered if that's still on track and then if there's any sort of changes as far as outlook there, given some of the recent tax announcements and changes with the government in Argentina.

I'll kind of start at the and back up. We don't have any changes contemplated in our plans at this point. We do have 2 wells that we're working on here in the fourth quarter, consistent with what I mentioned last, last quarter. And those wells are progressing. I don't have any results for you on that yet, but we are working on those. The one thing I think that I alluded to in my prepared remarks, and I've talked about the Neuquen Basin before and our large acreage position there. We are looking at the potential there for not only shale gas, but also tight oil and shale oil. And so that's encouraging, and we'll be progressing that, as I mentioned, several other tight oil plays that are emerging that we are actively working on. So back to your basic question, no change in our plans in Argentina, and the 2 wells are progressing.

All right. I appreciate it. And I'd like get one more quick one. It looks like you added one rig from the last quarter in Iraq, do you have a goal as far as exit rate on rigs there for the end of the year or sort of eventual plateau rate on rigs going into next year?

No, I don't have anything specific on either of those. There are a lot of factors that will drive that. I think the really important milestone that we've reached is we've gotten up to 370,000 barrels a day. The 6 rigs are running, a lot of workover activity. And again, that progress is going very well. But I wouldn't want to speculate on what something might look like down the road either next quarter or after that.

And we'll take our next question from Pavel Molchanov with Raymond James. Pavel Molchanov - Raymond James & Associates, Inc., Research Division: Dave, if I may, one on downstream first. I believe Exxon is the only company in your peer group that has not been actively looking to sell refining assets in the past, let's say, 1 to 2 years. I'm just curious what you see in the refining market that seems to be different from what many of your peers are perceiving?

That's a good question. Let me clarify that because, in fact, we have had some recent announcements about asset divestitures, which include refining assets. You might recall over the course of the last several months, we've announced divestitures in Argentina, various areas in Central America and then most recently, the Malaysia downstream asset sales. So we have had quite a number of asset sales over the last year or so. And again, they do include some refining assets. Now if you look at refining in general across the board, as we've talked about, in many occasions, one of the tremendous competitive advantages we have in our refining circuit versus others is the full integration with most of our refineries, with the chemicals and the lubes business. So as we continue to optimize those facilities and get the kind of profitability and returns on those that we're generating, I wouldn't expect us to see a lot of change. So we're comfortable with what we're doing. We don't proactively tout major divestment objectives or programs. But as you look back across the years, we have been very active and have divested a number of assets as those assets turned out to be worth more to others than they were to us. And we'll see what happens going forward. But right now, I think we're in pretty good shape. Pavel Molchanov - Raymond James & Associates, Inc., Research Division: I appreciate that, and just to be clear, I was mainly thinking North America and Europe, but your color on that is definitely useful. And then secondly, just on Poland, some press articles in the past week mentioning about your first frac jobs in the Polish shale acreage. Just an update on that would be great.

Yes, we are -- we've got a couple of wells there that we're in the process of frac-ing and flowing and cleaning up those wells. So it'd really be a little early for me to give you any initial results because we're just now literally, as we sit here, working on those and flowing them and testing them and seeing what we've got. So as we get through the evaluation stage and clean those wells up and see how they perform, we'll be in a better position to perhaps give some color on that. But today, it's just working on the operations.

We'll take our next question from Ed Westlake with Credit Suisse. Edward Westlake - Crédit Suisse AG, Research Division: David, a lot of question already answered. But can I just come back to the entitlement issue? So basically, Q3 should -- I mean, obviously, it doesn't affect cash flow, but Q3 should be a sort of a better base if we're trying to get a volumes right going forward? If, say, you kept the oil prices flat?

Well, there are a number of things that affect the entitlement volumes. One, of course, and not only the price, but the spend as well. In fact, when you look sequentially at that impact that we had the 76 kbd, a fair amount of that was actually due to spending being down and thus, the recoup in volumes going down as well as the tranche change that I mentioned. So in a constant price environment, you wouldn't see as big of an effect, obviously. You'd be more down to spending rates, and of course, tranche changes. But we did see some pretty big movement, particularly quarter-on-quarter, with that $30 increase in oil prices, and then again, sequentially, a more spend-driven -- rate of spend driven, as well as Iraq being cost-current. Edward Westlake - Crédit Suisse AG, Research Division: Okay. And then 2 small questions. But just the asset gains, do you actually have a number for the asset gain in E&P in the quarter? I mean, you mentioned $600 million that are a combination of a couple of things in there.

Yes. I'd tell you, Ed, I don't have a specific number associated just with the asset divestments to talk about this morning. Again, I'll confirm, though, when you look at both the quarter-over-quarter, as well as the sequential -- the primary factor, again, driving that other earnings impact are the impacts of the divestments. And then there were a number of other things up and down. Edward Westlake - Crédit Suisse AG, Research Division: Right. And then in R&M, the actual FX impact?

Sure. The actual impact in the downstream, if you're looking third quarter '11 versus third quarter '10 was right at $300 million negative. And then if you're looking -- in fact, I'll just tell you, if you're looking sequentially, it was also close to $300 million negative. So fairly sizable ForEx effects in the downstream this quarter. Edward Westlake - Crédit Suisse AG, Research Division: Great. And then obviously, there was a mix effect in terms of volumes with the liquids change, you flagged $170 million of extra tax in chemicals. But the 47% rate was still a little high. I mean, is anything else changing apart from the U.K.?

There are a couple of other factors I'd mentioned. One, of course, is the mix of profitability in terms of upstream, downstream and U.S., non-U.S. And then you have the kind of that effect where we had the absence, that I mentioned, of a few tax effects in chemicals and in corp and fin from last year and then a few negative impacts this year, and the difference between those 2 also contributes to that 2 percentage point increase.

And we have a question. It's a follow-up from Mark Gilman with The Benchmark Company.

There's been a lot said, I guess, in some of the freight press regarding extensive maintenance activities on Qatar gas trains. Can you help us out a little bit and quantify to the best you can what that looks like for you in terms of both Qatar gas and Russ [ph] Gas both in the third quarter and for the balance of the year?

If you look at the downtime that we've seen in the Qatar trains particularly over the last couple of quarters, I'll tell you that the work is done and those trains are up. And we actually saw -- as we came from the second quarter to end of the third quarter, we actually had less maintenance and some improved volume performance out of that in the third quarter. And so now, it's just kind of normal operations. But we did see improvement from the second quarter into the third quarter.

Is there anything remaining that needs to be taken down for maintenance purposes in the fourth quarter?

I'm not aware of anything major in the fourth quarter, so I would expect you can see basically normal operations.

And our final question today comes from Paul Cheng with Barclays Capital.

Dave, just 2 quick one. You talked about the open lift in the third quarter. Can you give us a number that -- how much is open lift? And also at the end of the September, from the inventory standpoint, are you still overlift, underlift or neutral?

That's a good follow-up from the last quarter where I'd mentioned how underlifted we were. If we look sequentially, which is probably the best way to look at our net overlift position, we were slightly overlifted this quarter and underlifted last quarter. And that gave a net overlift for -- of about 80,000 barrels a day quarter-to-quarter on a net basis.

Okay. So 80,000 barrels a day net overlift.

Yes. And on the...

Is that at the end of September or that is sequentially?

No, that's sequentially. So if you look, we were underlifted. I think, I mentioned in the second quarter, about 69,000 barrels a day. We were overlifted in the third quarter by about 14,000 barrels a day. And so the delta between those 2 is about 83,000 barrels.

And at the end of September, are you -- from an inventory standpoint, are you now pretty much balanced?

Yes, I think where we are year to date, we're probably pretty close. It maybe a little under or over, either way. But I think we're pretty close on a year-to-date basis.

Great. And David, would you be able to share with us how much is the production you actually booked from Iraq in the third quarter?

No. As we typically do, I don't typically give a country-specific number. But I can tell you, as I mentioned earlier in the call, some of that change we saw in the net interest or -- rather in the entitlements column, was Iraq getting cost current. But the most important thing in Iraq is that gross number, which we have now gotten up to 370,000 barrels a day. And that's a real milestone for us.

And Mr. Rosenthal, there are no further questions left in the queue. I'll turn it back to you for any closing remarks.

I just like to say thank you to everybody for participating on the call, and have a good day.