Good morning. My name is Brianna. I will be the conference operator today. At this time, I would like to welcome everyone to Noble Corporation First Quarter 2023 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press Star then one on your telephone keypad. If you would like to withdraw your question, star one again. Thank you. I would like to turn the conference over to Ian Macpherson, Vice President of Relations.
Thank you, Brianna. Welcome everyone to Noble Corporation's First Quarter 2023 Earnings Conference Call. You can find a copy of our earnings report along with the supporting statements and schedules on our website at noblecorp.com. This conference call will be accompanied by a slide presentation that you can also find located at the investor relations section of our website. Today's call will feature prepared remarks from our President and CEO, Robert Eifler, as well as our CFO, Richard Barker. Also joining on the call are Blake Denton, Senior Vice President of Marketing and Contracts, and Joey Kawaja, Senior Vice President of Operations. During the course of this call, we may make certain forward-looking statements regarding various matters related to our business and companies that are not historical facts.
Such statements are based upon current expectations and assumptions of management and are therefore subject to certain risks and uncertainties. Many factors could cause actual results to differ materially from these forward-looking statements. Noble does not assume any obligation to update these statements. Also, note that we are referencing non-GAAP financial measures on the call today. You can find the required supplemental disclosure for these measures, including the most directly comparable GAAP measure and associated reconciliation in our earnings report issued yesterday and filed with the SEC. With that, I'll now turn the call over to Robert Eifler, President and CEO of Noble.
Thank you, Ian. Good morning. Welcome, everyone, and thank you for joining us on the call today. I'll begin with some opening remarks on recent progress with our operations and contract awards and then provide some broader market outlook commentary before turning the call over to Richard to review the financial results and outlook. After our prepared remarks, we'll be happy to take your questions as always. Starting on page 3 of our earnings slides, 2023 is off to a great start as we continue to make steady headway with our business integration and continue to find exciting opportunities for recontracting our fleet into an improving market.
Q1 was our second full quarter as a combined company. I would again like to take a moment to express my profound appreciation to all of our fantastic offshore crews and global shore-based team who have embraced this integration and placed Noble on such solid footing at the outset of the exciting future ahead of our industry today. Richard will speak more to the financials. Our first quarter adjusted EBITDA of $138 million was, in our view, a good start to the year and a building block for what we expect to be progressively improving earnings over the course of the year as the contracted status of our fleet improves and we continue to realize integration synergies.
As an aside, we did encounter some additional slippage with the startup of the Noble Globetrotter I's contract in Mexico due to the permitting delays that we described on last quarter's call. Fortunately, we have resolved that permit issue. The Noble Globetrotter I's contract with PETRONAS is now expected to commence within the next 1 to 2 weeks. Considering the subtraction of that contract's previously expected contribution during the month of March, which was not insignificant, we feel great about the results for the first quarter overall and would like to commend our offshore and onshore teams for the excellent operational performance. We're pleased to announce several new contract awards that are shown in our earnings press release and updated fleet status report.
On the jackup side, the Noble Tom Prosser has been awarded new contracts from 2 operators in Malaysia for a combined estimated duration of 650 days starting in July. The Prosser will be idle through most of the first half of this year, as we had previously indicated. With full utilization, a modest day rate uplift, and a lower operating cost profile in Malaysia compared to its prior contract in Australia, this rig is now well-placed for an improved margin contribution over the next couple of years. We've recently secured several new contracts and commitments across the floater fleet. The 6th-gen semi-submersible Noble Discoverer has received a contract with Ecopetrol in Colombia for 1 well priced at an undisclosed rate. Colombia is a re-emerging exploration basin with several incremental drilling campaigns under evaluation in addition to this 1.
The Ecopetrol contract is expected to commence in Q4, and we are cautiously optimistic about filling more time on the Noble Discoverer between the conclusion of its current contract this month and the startup window for the Ecopetrol contract. Additionally, the Noble Valiant, which is currently finishing a program in Suriname, has been awarded a contract for one well in the Gulf of Mexico with an undisclosed customer at $450,000 per day and is expected to commence in Q4 2023. Prior to that well, the Valiant will mobilize back to the U.S. Gulf of Mexico to drill the Cosmos well that had previously been assigned to the Faye Kozack. This newly awarded one well contract will follow in direct continuation of the Cosmos contract, which creates a nice sequence for the Valiant into the fourth quarter.
We have ample opportunities for the Valiant in 2024, both in the U.S. Gulf of Mexico and elsewhere, would expect this rig to participate in the improving day rate environment as we contract its 2024 days. The rig swap on the Cosmo as well was to accommodate some potential long-term work for the Faye Kozack starting in the fourth quarter, which we hope to finalize and announce soon. Last but not least, we're very happy to announce that ExxonMobil has committed an additional 6.3 years of backlog under the commercial enabling agreement in Guyana. This additional term will be distributed evenly across our four drillships in Guyana, thus extending each of them from Q4 2025 into Q2 2027.
The unique combination of long-term engagement and collaboration plus market pricing has proven to be an incredibly productive and mutually beneficial commercial model for the Guyana development. We believe that this new additional backlog commitment speaks directly to the success of this model. We are pleased to have been entrusted with further work and honored to continue to play our small part in that world-class project. With these signings, our backlog as of May 1st has increased to $4.6 billion, up from $3.9 billion at the beginning of the year. In addition to these recent contracts and commitments, we're optimistic that we should have some additional UDW contracts finalizing over the coming weeks, which could further bolster our backlog and could also potentially resolve some of the near-term variability around white space that still appears on our fleet status sheet as of today.
We appreciate your patience as we work to get some more of these contracts over the finish line and look forward to updating you. With that, I'd like to turn now to a broader market outlook. Last quarter, we provided a detailed geographic description of incremental UDW rig demand, concluding that an estimate of 10-15 incremental units in the near term on top of the low 90s con-contracted rig count that prevailed then as well as now. As we roll that outlook 2 months forward, nothing has fundamentally changed, and we remain highly optimistic that tightness will prevail going into 2024. Oil price volatility immediately ensued from the jolting news of bank failures in March and continues with recent news. Our customers' underlying economics remain robust, and we have observed no pause or change in customer sentiment or forward planning.
Contracted utilization of the marketed UDW fleet has increased to 92 out of 99 rigs or 93% effective utilization, up very slightly from last quarter. With this steadily creeping tightness in the existing marketed fleet, there is now, as expected, increasing bidding momentum behind the 12 or so sidelined premium deepwater rigs that are either cold stacked or stranded in shipyards. As previously stated, we continue to expect a near-term dynamic in which some of this idle capacity is reactivated into the market at below-average pricing. While the scarcity premium for hot rigs that have near-term availability will continue to push leading-edge rates toward $500,000 per day.
Demand growth for UDW units over the near term is primarily expected across South America and West Africa, with Petrobras representing the largest component demonstrated by outstanding tenders for 8 floaters, including 7 for Brazil and 1 outside Brazil, versus only 2 incumbent floating rigs coming off contract. We also expect an additional tender for 1-2 more units coming up. This indicates a need for 6-8 additional rigs for Petrobras in the near to medium term. These tenders have recently been subject to customary delays and wider delivery windows for some of these start dates extending into late 2024 are seen as an inducement to attract reactivations into the bidding, as can be observed in the most recent tender results.
Turning back to the Noble fleet, as it stands today, we currently have approximately half of our marketed floater fleet exposed to contract rollovers over the next year, in addition to the 4 rigs operating under the CEA in Guyana, which reprice every 6 months. This affords us a great deal of attractive repricing leverage, with a partial offset being the short-term utilization inefficiencies that arise from a backlog structure that, for now, still holds a meaningful amount of short-term contracts. As previously stated, contract gaps and a relatively high number of 10-year SPSs are weighing on the utilization rates of our floater fleet over the near term, despite the exceptionally tight underlying supply-demand. The periodic surveys for our floater fleet will peak in 2024 before normalizing significantly lower thereafter.
This leaves backlog composition as the other area where we have an opportunity to pursue some utilization upside moving forward. A key question is whether customers are willing and motivated to start contracting on a longer-term basis. We see indications that some are. Up to this point, apart from our unique arrangement in Guyana, Petrobras has been the main customer that has been taking a significant volume of multi-year floater contracts. If you look at the average duration of new floater contracts awarded, excluding Exxon Guyana and Petrobras Brazil, the average duration of all other floater contract awards year to date has been 12 months, which is an increase of more than 50% compared to the average of under eight months per fixture during the comparable period a year ago.
Term has already begun to expand, and we would expect this trend to continue because contractors and operators are generally aligned around the motivations to reactivate the 12 or so high-spec sideline rigs, and it simply won't be possible to satisfy implied demand of 10-15 additional deepwater rigs without an acceleration of reactivations. These reactivations require multi-year contract support. We are continuing to evaluate interesting opportunities to reactivate our cold-stacked seventh-generation drillship, Pacific Meltem, with appropriate contract coverage and will maintain our previously outlined disciplined approach with this rig. As a reminder, we estimate the Pacific Meltem would require at least $100 million total capital and 1 year or longer to reactivate. Now on the jack-ups. Our outlook here is essentially the same as what we described last quarter.
The Noble Tom Prosser's new contracts for a combined 650 days are a welcome addition to our jack-up backlog. Leading edge jack-up day rates outside of Norway and the North Sea are now in the $125,000-$150,000 range. While we do have bidding activity underway that could provide additional plug for this year, these are generally more incremental in nature, and we continue to see improving demand possibilities for 2024 and beyond. This includes the ultra-harsh jack-ups, Noble Interceptor and Noble Intrepid, which are continuing to muddle through very soft spot market conditions over the balance of this year. Additionally, the Noble Regina Allen is undergoing repairs to its leg and jacking system, with marketability into jobs starting in early 2024.
No change to our prior view that jack-ups will contribute no more than about 10% of our total EBITDA this year. There should be ample headroom for improvement beyond this year. As of today, excluding the Regina Allen and the warm-stacked Noble Highlander, the remaining 11 jack-ups are approximately 70% contracted over the balance of this year at an average day rate in the $120,000 range. When we frame the future revenue and EBITDA potential for our jack-up fleet, it's from a fairly low baseline as of today, relative to forward indicators for day rates and utilization. Obviously, a recovery in Norway is an important driver for us, and the tightening harsh semi market is a constructive leading indicator.
In addition to the incremental Equinor jack-up demand for 2024 work, which is important to restoring a more balanced supply-demand situation for Norway jack-ups. For now, excuse me. For our non-Norway class jack-ups, there continue to be global opportunities for some of these rigs that may provide better near and long-term visibility than the UK and Southern North Sea. Since these are more geographically fungible than CJ70s, our strategy is to deploy these assets wherever is appropriate to capture the best returns. To summarize, we still have a somewhat bifurcated outlook for the deepwater and jack-up fleets. The recontracting trajectory for both remains very promising from where we stand currently. We've had a few nice contract wins recently for our deepwater fleet. We're optimistic about signing up some additional high-quality backlog in the near term.
With that, I'd like to pause now and turn the call over to Richard to go over the financials.
Thank you, Robert. Good morning or good afternoon all. In my remarks today, I will go over some brief highlights of our first quarter results. I recently completed refinancing and then discussed the outlook for the rest of the year. Contract drilling services revenue for the first quarter totaled $575 million, down slightly from $586 million in the fourth quarter. Adjusted EBITDA was $138 million in Q1, down from $157 million in Q4 of 2022. Diluted earnings per share was $0.74 and adjusted diluted EPS was $0.19. Capital expenditures for the first quarter were $63 million. As anticipated, the sequential decrease in revenue and EBITDA was driven by fewer operating days for our jack-up fleet, which was partially offset by increased day rates on our floaters.
Our 13 marketed jack-ups were 67% contracted in the first quarter, compared to 85% in the fourth quarter. This decrease was driven primarily by the Noble Regina Allen, Noble Tom Prosser, and Noble Invincible, all of which were highly utilized during the fourth quarter of 2022, but were off contract for the majority of the first quarter of 2023. Our 16 marketed floaters were 91% used in the first quarter, similar to the fourth quarter, with average day rates across our floater fleet increasing by 9% sequentially to approximately $332,000 per day. With average embedded day rates in our floater backlog above $400,000 per day and leading edge rates still trending higher, we anticipate further repricing upside to support visible revenue and EBITDA expansion in the quarters ahead.
The delayed start for the Noble Globetrotter I in Mexico did have a negative impact on the quarter versus our expectations. As summarized on page 5 of the earnings presentation slides, our total backlog as of May 3rd stood at $4.6 billion, up from $3.9 billion at the start of this year. This includes approximately $1.3 billion that is scheduled for revenue conversion over the remainder of 2023 and approximately $1.3 billion that is scheduled for 2024. We were very pleased last month to complete our refinancing, redeeming prior issued senior notes and issuing $600 million principal amount of new 8% senior unsecured notes due 2030 and securing an amended and restated senior secured revolving credit agreement, which provides for a commitment to $550 million and maturity in April 2028.
We believe this streamlined capital structure, which includes no maturities for 5 years and no amortization payments, provides ample liquidity and flexibility to operate the business effectively on a through-cycle basis and to execute on our stated capital allocation priorities, including the return of capital to shareholders. There are also numerous other integration-related benefits that this refinancing unlocks for us. Additionally, we believe it is a terrific outcome for Noble to become the first offshore driller in many years to reestablish an efficient regulatory structure supported by an unsecured bond. Our integration remains on track. We continue to expect to have realized over three-quarters of the $125 million target of annual run rate cost synergies in the fourth quarter of this year. As of the end of the first quarter, we have achieved approximately $60 million of synergies.
Referring to page 9 of the earnings slides, we are maintaining our full-year guidance, including total revenue between $2.35 billion and $2.55 billion, which includes approximately $200 million of combined reimbursables and non-cash revenue amortization. Adjusted EBITDA between $725 million and $825 million, and capital expenditures of $325 million and $365 million, excluding any customer reimbursable CapEx and capital related to the Noble Regina Allen leg repair, given the expected insurance proceeds. While we remain confident with these ranges, the delayed start of the Noble Globetrotter I contract has been a discrete setback relative to our outlook at the start of the year. To all else equal, this leaves us with work to do in order to de-risk the upper half of this adjusted EBITDA range.
This could, for example, be determined by additional contracting wins, which we believe are attainable, but as always, subject to timing uncertainty as well as potential gaps between contracts. We continue to expect a steadily upward progression of EBITDA each quarter, with the fourth quarter expected to be the highest EBITDA contribution of the year. As we progress from Q1 into Q2, we expect to realize revenue improvements from several areas, most notably a full quarter of the most recent CE-CEA repricing that took effect in March, startup of the Noble Globetrotter I contract in Mexico, commencement of the Innovator's contract in the North Sea, and positive repricings for both the Noble Faye Kozack and the Noble Viking towards the end of Q2.
As we look ahead to the fourth quarter of this year, we believe that we could approach an annualized run rate for adjusted EBITDA of around $1 billion, subject to the same aforementioned proviso that there were a few pre-pending contract awards that would serve to de-risk this view. The negative free cash flow of $126 million that we incurred in the first quarter was primarily driven by a net working capital build of $170 million. We expect the majority of this to unwind in the second quarter. In the first quarter, we purchased $10 million of shares. I would note that we were subject to extended blackout restrictions during Q1 driven by the pending refinancing, which significantly limited our ability to repurchase shares.
With the refinancing now behind us, we very much look forward to ramping up our return of capital to shareholders. That concludes my remarks. I'd now like to pass the call back to Robert for closing comments.
Thank you, Richard. With an expected upward progression of our quarterly EBITDA through 2023 and a viable path to $1 billion of annualized adjusted EBITDA in the fourth quarter of this year, the financial outlook for 2024 and beyond continues to remain extremely robust. We now have our refinancing in the rearview mirror, we'll look to return a significant majority of our free cash flow to shareholders going forward. You can expect us to continue to execute on our share repurchase program and to continuously evaluate if and when a dividend might be appropriate. I am so proud to be a part of this incredible company, to work with our exceptional colleagues, and to help bring the best of both Noble Corporation and Maersk Drilling together to better serve our customers.
As we continue on our journey to creating the leading offshore drilling company, we remain very encouraged by both the commercial pipeline of activity from our customers, as well as the structurally redefined supply-side dynamics of our business, which is still in the early stages of emergence from a deep and protracted underinvestment cycle. With that, I'd like to turn the call back to the operator for questions.
At this time, I would like to remind everyone in order to ask a question, press star then 1 on your telephone keypad. We will pause just for a moment to take, to compile the Q&A roster. Our first question comes from the caller of Kurt Hallead with Benchmark.
Hey, good morning, everybody.
Hey, Kurt, how are you?
Good. Good. Thank you very much. I'm kinda late. You laid out the groundwork here for obviously continued improvements throughout the year. You did tease the dynamic here that you could potentially have some additional contract announcements before the end of the year. I guess my question in that, in that dynamic, you know, are these additional contract announcements, you know, pushing up above the recent leading edge rates of, I guess we're in the $400-$450 CapEx range? Could you just give us some color around how you see that evolving?
You don't have to get into specifics, obviously, and you wouldn't on this call, but I'm just trying to gauge how you feel about the potential pricing of these contracts coming up in the back half of the year.
Sure. Yeah. I mean, we feel very comfortable with where we've priced these. We're big believers in the market and riding the market where it goes. You know, not over the finish line, so I don't wanna get ahead of ourselves. We're marketing groups an incredible job of making sure that we're looking around corners and pricing effectively. I'm quite comfortable that these will be well-appreciated fixtures if and when they come through.
Got it. Thanks. Thanks for that. Appreciate that. On the Pacific Meltem, would that be a possibility here before the end of the year to potentially, you know, have a contract for that, as well?
It's basically where we've said before, as conservative as an approach as we're taking. There's only for now, only a couple of contracts really kind of per year, kind of 1 to 3, I'd say, per year that would qualify for our criteria. I mentioned last quarter that we could relax that criteria going forward, but we've said today that we're not planning to right now. Yes, it's a possibility. You know, we think that work excuse me, that rig ends up back in the marketplace. It's a highly capable rig, and we're just trying to be patient and pick the right opportunity for it. It's you know.
I don't wanna put a percentage to it, but we are actively chasing opportunities and we'll see what happens.
Okay. Great. Appreciate that. Maybe if I just wrap up, you re-referenced you're gonna be returning cash to shareholders. A number of companies have kinda pegged a certain percentage of free cash flow that they were gonna allocate. Have you given some consideration to a percentage of cash flow that you may return to shareholders?
Yeah, Kurt. We haven't put a specific number on it. Obviously the refi that we got done here in April was helpful to that. We're now saying a significant majority, you know, but we're not putting a specific number to it right now.
Okay. That's great. Appreciate the color. Thank you.
Thank you.
Our next question comes from Eddie Kim with Barclays.
Hi. Good morning. Just a quick follow-up on the Meltem. Obviously, you mentioned Petrobras might be setting some contract dates to commence late 2024 to induce some cold stack rigs into bidding on some of their tenders. Are you currently bidding the Meltem into work now? Ideally, how long of a contract would you be looking to secure to justify the reactivation of that rig?
Yeah. I guess a few things there. One, the public results of the Petrobras tender would show that we're not in the current tenders with that rig, and we have our specific reasons for that. You know, for one thing, that I don't wanna presuppose where we might end up bidding that rig or looking to put that rig into a maiden contract. It is a question of risk tolerance around some of the criteria that I've outlined previously, including termination rights and time to perform the shipyard work and reactivation work before liquidated damages or termination rights might kick in.
As we looked at the now public tenders, we didn't think that was the best fit for the Meltem, but that doesn't mean that it would be precluded from something there in the future by any means. You know, generally speaking, at current rates, 2-3 years is a timeframe that I think works quite well for an initial contract for that rig. Again, extremely important to us, are the contract terms that sit around the financials.
Got it. Got it. Understood, that all makes sense. Just my follow-up is on the comment in prepared remarks, that, you know, the day rates are trending towards $500,000 a day. Some of your peers highlighted the same earlier this week. Would you expect us to be at that level by the end of the year? Do you think that we'll see a contract signed at, you know, with a five handle? Does that get pushed out to kind of mid or late next year?
There's a couple things that need to fall into place, I think, to see another step change up in rates. As I've said, and I still believe, very much believe that it's possible that we see it this year, obviously not for work starting this year, but that we see the fixture. I think you'll see some all-in contract value rates that for sure meet that threshold. In terms of just a flat and clean rate, there's a path. I think we need for one thing, Petrobras to execute on a lot of the contracts that they're out tendering for.
From there, as I said in the remarks, we see some tightness in 2024 that's very much conducive to some rate appreciation here.
Got it. Great. Understood. Thank you. I'll turn it back.
Thanks, Eddie.
Our final question comes from Fredrik Stene with Clarksons Securities.
Hey, guys. Hope you are all well, and thank you for taking my question. I wanted to touch a bit more about the projected or the guidance you gave here, Richard, and how we can expect the year to develop and potentially reaching a run rate EBITDA of $250 by the end of the year, or sorry, $1 billion by the end of the year, but I guess that would be around $250 for the quarter. When we look at the $138 adjusted you delivered today and then reaching $250 by the end of this year, do you have any idea of how that slope will look through 2024 at this point?
Where I guess we're also expecting to see more work for your jackups and not only improved performance based on repricing floaters. Kind of any color you can give on how you think your financials will continue to develop, would be super helpful.
Sure. Yeah. Obviously our guidance for 2023 is the same as what it was at the start of the year. Q1 EBITDA or adjusted EBITDA was $138 million. You know, we see a path to that $1 billion of annualized EBITDA in Q4, which is $250 million. That's not guidance per se, but we can see a path towards that for sure. You know, our jackup fleet is not contributing much candidly to EBITDA this year. We only see it as about 10% of our EBITDA. As you think beyond 2023, I think there's significant upside or option value, if you will, or EBITDA upside that's not necessarily incorporated in the numbers this year.
You know, I think that as we sit here today, we see a quarterly progression in EBITDA as we move through 2023, and I think we're very optimistic about 2024 as well.
Thank you. I also wanted to touch a bit on contracting strategy and, you know, you don't need to disclose your actual strategies. For particularly with the SPS's coming up for I mean, a large part of the fleet and what you said in your prepared remarks about some of these assets being repriced this year, there's some short-term coverage on a meaningful part of the fleet. I guess you can kind of look at this two ways, but obviously there's the utilization impact of having short-term contracts, but on the other hand, you are kind of helping the market by repricing that fleet a bit more often. Have you taken kind of...
Do you have any active strategy in how you're managing this portfolio of your of floaters in particular now? Are you actively, you know, holding out or chasing short-term contracts just because you want to reprice further? Are you actually looking to limit the amount of short-term work?
It's a good question, Fredrik. I'll take it and then fill in if I've missed something. But, first of all, you mentioned SPSs. That has no effect on our contracting strategy. It can create some friction in white space just because if they fall in between customers, which probably was your point, that it sometimes can and has in our case, led to just a little bit of inefficient white space. But generally speaking, that's just a function of offshore assets, and you work with your customer to find the time in between wells to do it. It's something that's discussed prior to signing contracts and known to everyone for a long time, et cetera.
While it does affect, you know, maybe some tactics or some efficiency, it doesn't really affect strategy per se. I think Noble's journey has been just very slightly different than others, because, you know, we're very thankful to have the CEA in Guyana. Since that's a big component of our tier one drill ships and it reprices, we haven't been, I don't think we've felt as pressured over the past couple of years to take on longer term contracts. That's, you know, thankfully played, I think, to our benefit here, putting us to present. We have a large fleet. We have, I think the largest tier one fleet in the world. Certainly we have, we have global scale with our, with our UDW fleet.
From where we sit today and where we see pricing, despite the fact that we see pricing increasing, as I've said, there's room for a couple of long-term contracts, I think, in our fleet today. It, you know, it has some helpful implications. We are by no means shying away from bidding on longer term contracts. Even though you may not have seen us win in some of those, in fact, I guess all of those that have been announced so far, we are participating and by no means is it excluded from our strategy. I think a mix is helpful.
The last little bit of color I'd give is that in our sixth generation fleet, we're a little bit more likely, I think, there, to seek out term, than we would, in the seventh generation fleet, if that answers your question?
Yeah, that was super helpful. Super helpful. Final one for me since it was no one else in the queue, at least when I started. Just on the capital allocation framework. You know, you're buying back shares, your new debt stack, congratulations by the way, gives you more flexibility on shareholder paybacks. Or which criteria needs to be met for you to have, you know, a well-defined policy in the sense that, you know, you're paying out a certain amount of net income or a certain amount of cash flow so that we get even more visibility than what we have today?
Yeah. It's a very good question, and something obviously that we are very focused on. You know, the refi was very important to us, right? It gives us better visibility around our capital structure, just allows us to manage the business through cycle better. Obviously we were free cash flow negative in Q1, and we expect that to reverse here, you know, obviously into Q2, then we expect to generate an attractive level of free cash flow for the entire year. You know, we're looking now to return a significant majority of our free cash flow to shareholders.
We're not putting today a specific percentage to that, but I think it's fair to say that it's, you know, it's obviously gonna be closer to 100% than 50% today.
That's very nice color. Thank you all for good answers.
Thank you.
We have no further questions at this time. I would like to now turn the call back over to Ian Macpherson.
Thank you everyone for dialing in and for your continued interest in Noble. We look forward to speaking with you again next quarter.
Ladies and gentlemen, that concludes today's call. Thank you for joining. You may now disconnect.