Thank you, Doug. I guess I'm with the leading company because I'm the oldest guy in the room. Listen, I want to thank each and every one of you for coming today. I know it's early, so thank you for your interest in Valero. It's very much appreciated. With me is Gene Edwards, our Executive Vice President for Strategy and Development, Ashley Smith, our VP of IR, and Matt Jackson, our Specialist in IR. We're very excited about the business. We represent, in a way, the industry. You will see here, Doug, do we have our slide?
There we go. All right, those of you that don't follow Valero all the time, here's an overview of our company. Yes, we're very large in this business. We are a refining company first. There's no question about it. We have 16 refineries, including Pembroke and Meraux in Louisiana, which we purchased last year. About 3 million barrels a day of total throughput, 2.5 million of crude, about 190,000 barrels a day of average capacity.
We have 6,800 branded units, 1,300 or so are company-operated, 1,000 in the United States and about 300 in Canada. The rest of the business is a jobber distributor-type situation. We are also one of the companies that have stepped into renewables and ethanol. We have a very strong position in ethanol. We're like third in the business. We also are working on biodiesel.
We have some investments going in cellulosic. The reason we're in some of this is there's a mandate. Even though the excise tax and these benefits have gone, there's a mandate to use it. It's part of the fuel mix. Here's our footprint. The blue is our marketing area. In your upper right, you can see Pembroke. If you think about Pembroke, we export gasoline from Pembroke into the East Coast, South America, and Africa.
Valero exited the East Coast refining business, but we didn't exit the East Coast market. A very good market. We also have Canada, which services mostly its local market, but this winter with the mild winter, we've actually been able to export distillates into New York Harbor, quite frankly. You look at the rest of the situation here.
Our ethanol plants are very well located in the upper Midwest there, right in the Corn Belt. We think we do have an excellent position with our 10 plants. We're also in corn oil now. We are extracting some corn oil. There is opportunity around all of those plants. The Gulf Coast is our concentration, no question about it, but it's a very changing dynamic in this business, and you'll see more as we go through our slides.
The Gulf Coast is very competitive, that's for sure, but it's also the most efficient place and also gives you huge opportunity for exports, which are a key part of this business going forward in the United States 2011, we're only into March, but we're still talking about it. It was a great year last year. The blue is cash flow, and the black is earnings.
You could see it was a remarkable recovery here from 2008 and 2009. 2008, we wrote off $4 billion of goodwill. That is the gray area there. Otherwise, 2008 was a profitable year for us. You can see we made $3.68 last year a share and had over $7 of cash flow. It was a very good year. The market is changing, as I mentioned.
There are many things that are going on, and you will see on these slides as we highlight some, but there are significant changes that are going to occur over the next couple of years. The export markets are growing, and they are a huge opportunity for the refining industry, not just Valero, but all the entire industry. The Atlantic Basin, we are closing refining capacity in the basin significantly.
I mentioned years ago, there was 1 million-2 million barrels a day of too much capacity in the United States and North America. There was maybe even a little more than that in Western Europe. Japan is probably half a million barrels a day too much. What we have had happen here is a rapid increase in the amount of closing, very, very quickly. It happened faster than I even thought it would. But the market is getting better or more in balance, which at the end of the day lets us raise our operating rate. That is what is happening to our industry. We at Valero are increasing our distillate yield. I will show you more about that on a couple other slides. Natural gas is a huge competitive advantage for the United States refining industry. Refining is a large consumer of energy.
Low natural gas is a huge advantage, and we have a slide to show you some of that. You will see on this last point, the unconventional oil and, of course, the gas, the Canadian oil coming and eventually getting to U.S. Gulf Coast is going to change this industry tremendously as we go forward. The Canadian oil will eventually get to the U.S. Gulf Coast. Looking at this slide with the growing export markets, they are growing for many reasons.
Countries are growing, Brazil, Colombia, Mexico, they are growing. We also have the closures. So many closures, as we know, Philadelphia area, Hovensa, before that, down in Virginia and of course, in Montreal. Then you have operating issues with Mexico, Venezuela. Venezuela used to export. We have a slide at the back. Today, you really do not see exports from Venezuela anymore.
We also have the Curaçao refinery, then, of course, we have Western Europe situation. We have a lot of opportunity that is coming really from the supply side on refinery closures and operating, and on demand side with growth in Latin America, primarily. You can see that looking at the charts. On the two charts we have, PADD 3 is obviously the area of most of the exports, which you would expect.
Have all this capability there. Then the chart on your right shows that most of where it is going in Latin America takes both diesel and gasoline. Obviously, diesel goes to Europe as well, but because the gasoline mixed with the diesel going to Latin America. In Valero's case, we are about 25% of the exports. You know the weekly statistics, and we know they will get revised.
Diesel exports are now over 1 million barrels a day. Gasoline was over 600,000 barrels a day. The export volumes are huge, as I said, and we represent about 25% of that opportunity. You look at closures on the next slide, and you can see here the chart on your left is showing the Atlantic Basin in blue, and then the green is the rest of the world.
They've been concentrated in the Atlantic Basin, which you would have expected by all the capacity that's there and how the demand has been actually relatively flat in those markets. The chart on your right shows this cumulative effect here. When you add all this up and you look at it, this year, for instance, there's over 2 million barrels a day of crude capacity coming into the market, new capacity around the world.
If you take all these shutdowns and you actually look at the numbers, it's about a net of 800,000 barrels a day. If we have demand grow a little over 1 million barrels a day that people are forecasting for 2012, it'll actually be an assumption of this capacity this year, which none of us would've really forecasted a year or so ago. Operating rate then as a result goes higher, and we're all more efficient when we can operate at a higher rate. With the closures, we've actually seen the margins respond. You have two charts at the bottom. The one on your left is the Gulf Coast against LLS, the 5-3-2, and you can see the one on your right is New York Harbor, Brent, and it shows the fourth quarter versus the first quarter month to date and quarter to date.
You can see that the bigger improvement actually occurred on the U.S. Gulf Coast, where you see how much that the margins recovered. Exports, the drawdown in supply, and actually we think this is the future of this business on the product side of things. Very significant change with all this capacity that's left the market. If we start getting into then the refined products and what Valero's been doing, because for us, we compete in the world market. Some of our competitors in the business compete in niches or are landlocked or in certain areas. But for us, we're very much part of this world business. You can see here how is the world growing. Well, on your left are margins, and so this is the Gulf Coast margin. So you got gasoline in blue and on-road diesel in red.
You can see over the last several years, depending on which one, we have a 10-year average, a five-year, 2011 and 2012, that the distillate margin is much better than the gasoline margin. So we're having a shifting in what the world wants. Then you say to yourself, "Well, why is that?" Well, look at the chart on your right, and here you can see this growth. Now let's put it in perspective.
The world distillate business is about 26 million barrels a day. The gasoline business, 22 million barrels a day. On top of the diesel, though, you have to add jet, kerosene jet, which is another 6 million barrels a day. So middle distillates are about 32 million barrels a day against 22 million barrel a day gasoline business in the world. Then look at the growth rate.
The growth rate is twice as fast for distillate as it is for gasoline. You will see what we have been doing is we are changing our output to meet this world demand that is actually pulling products from the United Sates in the form of willing to bid up the price. We started these projects in 2006, it is hard to believe, when 2009 was a very difficult year, as you could see from the first couple of pages, the first slide, where we actually had a loss in 2009. We stopped our projects. This is what is happening at Valero. The black line on your left for Valero against some of our competition shows our distillate yield, and by 2013, we will be up to 39%, 40% distillate production, meeting that demand that we saw in the previous slide.
The slide on your right just shows the trend line here from 2010 to 2011, but the actual numbers will be about 40% distillate, 39%-40%, servicing the market. With Meraux, when we bought that refinery here last year, it had a distillate hydrotreater, also had a hydrocracker. You will see us take action over the year, and we will actually increase the distillate yield there as well. It fits very nicely with our business on the Mississippi River. I mentioned earlier, natural gas. This is a huge competitive advantage for U.S. refining industry. This is huge. If you look at this chart and we try to put it in perspective, remember years ago, foreign refining was going to kill the United States refining business?
I will tell you, if they are routing LNG, so they are up at something like $89 a barrel here, but say it is I have to figure it out here. But say it is $13 per Mcf here, or $14, versus the U.S., which is about $2.50 on this slide, $2.60 per million Btus or per Mcf. You can see the delta. Now, how important is that? On average, for us, every buck is worth about $0.25 a barrel in operating costs. That is in operating costs and in cost of goods sold because we take natural gas and make hydrogen. The net effect of $5, $6, $7, say $8, is $2 a barrel, lower operating costs or cost of goods sold, but in the sense of cash flow through the system. The natural gas cost is huge in this industry.
Valero consumes today about 600 million cubic feet a day. Count ethanol, it is 700 million cubic feet a day. After our hydrocrackers, it will be 800 million cubic feet a day. Every dollar is worth $800,000 a day to Valero. This has been a huge change in the business, and this is true for everybody. This is why the outlook for U.S. refining, whether it is domestic landlocked because of crude situation or U.S. Gulf Coast, where we compete in the world market, why U.S. refining, it has changed dramatically, and none of us really had this in our foresight.
We are building two hydrocrackers. If you look at this, we have finished two hydrogen plants. We used to make hydrogen at McKee and Memphis from reforming. You do not want to do that when you have $100 oil and $2.50 natural gas. You want to make hydrogen from natural gas. If you don't have third-party hydrogen, which we do not have there, where you could buy it, we built two hydrogen plants. They are online today. They are not that big a project, but they are very economic, and they are very strategic in how we view the business.
The two big projects here are the hydrocrackers. Looking at those hydrocrackers, you can see the contribution that we expect from them. One is done in June. It should be on time, and it is actually going to be under budget, starting up in July, and the other one at St. Charles will be done at the end of the year, starting up basically end of the year and into January. Those two units are what are shifting our distillate production that I showed on the earlier slide.
But look at the rates of return, and you can see this contribution is over $1 billion. Take off some DD&A and think about this is $1.50 - $2 per share of earnings. This is the one area that distinguishes us from many of our peer group in the business, is that Valero has been investing in economic projects here quite heavily, and those projects are all coming to fruition here now.
We also have the Diamond Green Diesel, which is a renewable diesel project that will come on at the end of the year as well. Remember, we still have this mandate to use diesel. The difference between biodiesel and renewable diesel, renewable diesel will fit into the California mix. We have had many people ask us about the hydrocrackers. We feel like we are underappreciated. They are big projects.
So what our people have done here is put an example together because you do get liquid volume gain. So they are 60,000-barrel-a-day hydrocracker, and you can see that on this chart. You have this hydrogen. You use lots of hydrogen, which came from natural gas, very low-cost natural gas. This is a gas to liquids project. You are basically taking the hydrogen, which natural gas to hydrogen into the liquid.
You are saturating as you break it up, so you wind up with a liquid volume gain, and we have described that. In the appendix in this presentation, we give you all the assumptions around all of these numbers. But this is the basic issue and the basic advantage. Taking gas to liquid, and that liquid is diesel, which has the better crack. So they are very good projects, and they will make a big difference in Valero going forward.
On the right, you would expect our operating cost to be, add to our operating cost there. These are big units. Each one, as you could see on the other slide, is about $1.5 a piece, so very large projects. We have other synergies on how you blend, because these hydrocrackers will make a very high-quality cetane diesel fuel that allows us to optimize throughout our system.
Even in the worst market, thinking about it, all we have shown you here is the St. Charles and Port Arthur hydrocrackers under different price sets. So in 2008, we had very high margins. Remember, it was still part of the golden age of refining. But in 2009, which was a dismal year for everybody, and I understand that, you can see they still would have contributed $600 million to our profit.
This is during a period when natural gas is falling as you go out here to 2011. The distillate cracks have changed during that period, but natural gas has fallen, making its contribution to the profits even greater. We think these are very, very good projects. A point we would also make, this is really independent of the WTI discounts. It really does not matter what is going on on there. We expect that the Canadian crude oil is going to get to the U.S. Gulf Coast. It is probably going to get there on Obama's timeline, first quarter of 2013 approval, and Keystone XL will get built. They will get there maybe as far out as 2015. There is another huge dynamic going on in our business, and this is the unconventional oil. It is the shale oil. It is coming at us everywhere.
Whether you hear the headline numbers in the Bakken, where with big discounts because you cannot move it, or the Cushing, which is the WTI Brent or LLS, or the Gulf Coast, this oil is coming. The Eagle Ford is now up to somewhere around 250,000 barrels a day, and four years ago, it was zero. The Bakken is up somewhere close, I think, to around 500,000 barrels a day. Both of these are going higher. Then we have the Granite Wash. You have all these other shales that are going to produce. You look at our chart at the bottom and you say, "Well, what is really going on?" That red dashed line is sweet crude imports to the U.S. Gulf Coast, and we use 952,000 barrels a day here.
PIRA, some other people have come out with different numbers, so it really has to do with where you draw the cut on the medium. Just take it in this 750,000 to 1 million barrels a day of sweet crude is imported into the U.S. Gulf Coast. You can see how we view this. The market is going to push it out, and it is getting pushed out.
Whether it is Seaway or Longhorn reversals or a new pipeline, that oil is coming to the Gulf Coast. The sweet crude is going to push out all the foreign sweet. Then what happens? You could see here, we think it is 2014, 2015. Then what happens? LLS is going to sell at a discount to Brent because, one, you cannot export it under the rules today. The other thing is, there is no economic attraction.
You are not trying to draw West African Saharan Blend into the U.S. Gulf Coast because now you are long, so actually it will sell at a discount. What has happened to the U.S. refining industry on sweet crude on the U.S. Gulf Coast? Competing in the world market, prices are set by what? Foreign sweet. Now the U.S., not only on an operating cost basis, but now has a crude cost advantage.
This is huge, and it will only get greater as we go forward here. We have a lot of words here talking about this, but LLS will sell at a discount to Brent. Today, it already is a little bit. It is just going to get wider as we go through time. Switching subjects entirely here, getting over to ethanol. This has been a very good investment. We did this in 2009, in the first quarter.
Those things were looking pretty bleak. We bought into the business. We built our business. We have recovered all our cash. It has been a very good investment for us. As I said earlier, the mandates are there. It is still part of the fuel mix. We see ethanol, whether it is E10, E15, E85, ethanol is going to be part of the fuel mix going forward, and we like our position.
We got all our cash on a pre-tax kind of basis. We got all our cash out of this business in just three years. In our retail business, we never really talk about it. No one really asks us about it, so we put the slide in here so you would have to view it. You can see here that it is a good business for us. The blue represents the U.S. and the red is Canada.
This is a company-operated retail business, those 1,300 units I mentioned earlier. You can see here that where our profits, it has been a pretty steady contributor. It throws off cash to the company. If you are looking at the right chart, you wonder how come I said 1,300 when this shows it is more than that. It is because in Canada we have about 300 units at stores we actually operate, but there is another 500 that we control the fuel price.
The Canadian business model is different than in the U.S. Even though it is a third-party store, we still control the fuel. We actually set the price at those stores. That is why we have that. Basically, we have about 1,800 stores where we are controlling fuel, but we company operate about 1,300. Very good business for us. Very steady cash contributor to the company.
Now we are going to be a first quartile refiner. We bought a lot of refineries that were underinvested. They underperformed. We have worked very hard on this. We have two selections here. There is a good benchmarking study in the industry, gets done every two years, and then we calculate the years in between. You can see here our energy efficiency is improving, but we will be a first quartile refiner, and we are making a major effort, very organized, systematic approach to doing this.
Energy efficiency has improved, but the one that maybe we are most proud of is our mechanical reliability or availability, because that drives everything. That drives your safety performance, your regulatory performance, everything. When you are reliable, and we are now borderline first quartile, and you can see before we were third quartile. A significant improvement here. We have many programs.
We probably are spending $30 million-$50 million on this annually now in inspection programs and systems we are putting into this entire network we have to be first quartile. We are proud of this, and we continue to work very hard, and there are many other metrics in these surveys. Our capital spending, obviously, as I said, has been very high this year, about $3.4 billion.
Last year, we spent $3 billion. The orange-yellow is our economic projects that strategic or economic in the sense, largely made up at the hydrocrackers. We also have coke drum replacements, things like that fall into the other areas here, the green area. We upgraded the Memphis cat cracker a year ago, fixed it. It was very unreliable, only ran a year, and we had to take a turnaround.
We fixed the St. Charles cat cracker with a huge project last year, fixed that unit. That was the same situation. Basically, could only run a year to 18 months. It was a millisecond cat. We converted it to a riser cat. We did that with about six weeks, seven weeks, converted the entire unit. Now it will run four to five years in a very reliable state.
Those are the things that are improving our mechanical availability. We replaced the coke drums at Port Arthur. Right now, we are replacing the coke drums at St. Charles. That has been an engineering issue, and we are solving those problems. St. Charles will be down for nearly two months as we replace these coke drums in that structure, and that refinery will be far more reliable.
You see a significant change in the operations of Valero here that is very specific to us. Then you look at this capital spending. It is going to fall by $1 billion next year or so. We will generate lots of free cash flow as this economic projects come down significantly here as we finish this large investment that we have been doing over the last few years.
As we conclude here in the next couple of slides, you think about us. We manage our strength. We expect to have significant free cash flow here going forward. Capital spending is dropping, plus the earnings potential from these big units that we are building. We are going to return cash to the shareholder. We tripled our dividend back to where it was before the Great Recession. We are back to $0.60 a share on an annual basis.
We will look at this again in the second half of the year once we finish the hydrocracker at Port Arthur and get it up and running. We also bought our shares last year in the fourth quarter, and we continued to buy our shares. Some spilled over into January, but we have told people that we are out there buying our shares as we see the opportunity.
The reason is, and it is different than when we bought our shares years ago in the golden age of refining. In the golden age of refining, we had all this cash, and we chose not to buy other refineries at that time. We chose to return it to the shareholder, and we did that. This time we think our stock is terribly undervalued, and thus we are buying it for that reason.
We want to have one of the highest dividend yields among our peers. We have good cash position, lots of liquidity. We are very strong on liquidity with a good debt ratio. We paid off debt last year. We will pay off some debt again this year and continue to maintain a strong position. Clearly, we have more volatility in the business today.
When crude oil can move $3 or $4 a barrel, we are buying over 2 million barrels a day of crude, another 500,000 barrels a day of feedstock. Things are moving $2, $3, $4 a day. You need to have lots of financial strength. Our priorities, you know it is always about safety. You expect that of all the refiners that will speak to you today, you expect a safe performance from us. And maintain our investment-grade rating.
With our size, we think we have to be investment-grade. I told you we're going to be first quartile refiner, and we're going to be in most of the metrics system-wide. We have our value-added projects that are getting completed. We continue to work our portfolio. We've done a lot with this portfolio. Remember I mentioned we exited the East Coast. However, with Pembroke, we still supply the East Coast.
As the market is shaping up, we think we made very good strategic move there. We'll continue to integrate these new acquisitions, reevaluate attractive acquisitions. We will not issue equity on an acquisition. They're going to be accretive as well if we do any of them. There's things available out there, and we look at it. We mention all the time that we look at these acquisitions. Our goal is to add shareholder value.
It has to be long-term. This is a capital-intensive business in refining. We believe we're an excellent buy. I've already mentioned we think we're cheap. We don't think the market has given us the realization of all these economic projects that are just around the corner now. I acknowledge that when we talked about them a year ago, they're just so far out in the future. That's not the case today.
A lot of other things have happened to us, as far as this reliability. We've made a lot of improvements. Exports are huge for this business. We're going to keep benefiting from that. This natural gas is huge. The oil situation is huge. Very significant changes. The growth in diesel fuel is huge. The shales are coming. Canadian oil is going to come to the Gulf Coast. It's kind of crazy what's going on here on this. We have a strong performance from our other businesses. We're improving, and we're going to return more cash to the shareholders, and we're cheap. I thank you for being the group that came early. I appreciate you being here. With that, thank you.
Bill, thank you very much indeed. Folks, we've got about 10 minutes for questions, and we should have a roving microphone. We are webcasting, so if you have a question, please make yourself known and we'll get the microphone to you. Bill, if I could kick off with just, I guess, a quick question on the dynamics of exports. You've mentioned several times how important it's become to the dynamics of the North American business or U.S. business. How sustainable is this new export dynamic? Is it something that goes away in the near term, or is it something you think is now a permanent fixture of the business?
I think that exports are a sustainable part of the future of this business, and it comes for two reasons. Countries are growing. The United States, and we don't have, in part of our presentation, an expectation of huge demand increase. That's not part of our deal. We think as people get back to work, stabilize, you feel better about your income, we'll get some uptick in gasoline, but it's not the driver of how we see the world. Diesel in the U.S. will continue to grow. It'll eventually recover. Diesel took a huge hit in this recession, and it'll eventually recover, and it'll continue to grow. But the exports are where the action will be from the Gulf Coast. The niche players will do just fine as well. The bulk of the industry has to push and push it out.
What happens is, it's not a push, it's being drawn, and it's being drawn because Brazil is growing. Mexico is growing. Colombia is growing. Ecuador is growing. Other places have shut down capacity. Europe is still short diesel. Refineries are shutting down in Europe. They're going to take this diesel. The gasoline business in the Atlantic Basin, Africa will take it.
Frankly, the African refineries do not run very well at all. I do not see that changing. So they continue to have volumes moving to there. We've sent fuel as far away as Australia, Chile, and a lot of it tends to be high-speed things, but we do that. So I think it's very sustainable. On top of that, the demand side, we have a very strong cost position. Our cost position is terrific because of the oil that's getting pushed down. It's going to sell at a discount to the world market and natural gas, let alone the efficiency of our employees on the U.S. Gulf Coast. You want to add anything, Steve?
No, I agree. The only reason I think you'd see exports go down for particularly in distillate is because if U.S. demand recovers, we may not have enough distillate to export. So it's actually a positive thing. We don't really see a distillate being exported because we have to push it out. That's not our scenario at all. I think it's a very positive market going forward.
Thank you. Any questions from the floor as we have a roving microphone? We will go to the middle first, and then down here.
[Can you talk a little bit about the planned availability of the portfolio on 2000] [inaudible]?
Yeah, go ahead. As far as the relative value to Brent, we think that light sweet crudes and medium sour crudes and heavies will continue to maintain very good discounts to Brent. You could have a scenario where LLS and Mars are more competitive just because both of them get discounted. Because as LLS pushes down, there is going to be some competition, refineries trying to optimize their portfolio to run between the sweet and the sour. So there will be some spread between LLS and Mars. But we feel both of them, including the heavy crudes, will all be at significant discounts to forward sweet barrels.
If the discounts, you can think of, the discounts for heavy sour will go against Brent. Okay? So it might be compressed against LLS, but it will be against Brent.
Tom, go ahead.
Can you qualify on the [inaudible]
Yeah. Tom, we are spending somewhere in the $30 million-$50 million range, and that will taper off. We put in very rigorous programs. We have a program called ESTERN, which is an electrical program, and MAIN, which is mechanical. We've been doing retro PMI with positive material identification. You say, "How can this happen?"
Something gets built, and it's in an alloy circuit, and somebody puts a carbon steel valve or a little spool in there, and then it gets covered up with insulation, and you can't see it. In an alloy circuit, that'll eventually fail. Years ago, one of the majors burned down a coker because somebody had put a piece of carbon steel in a hot circuit, that it was the wrong service. It took 10 years and eventually failed. This stuff happens, and you try all the things you can do.
We're going through our entire system, and we're starting a program we call ROTO, which is dealing with rotating equipment. We probably have 20,000 pieces of rotating equipment. Where you see it, though, and just to finish that, one of the key things you have to do is keep all this data so you're not repeating it in five years.
We have very good systems as we go through things of knowing where we have the data. If somebody goes out to do work in a unit, we're documenting it very, very carefully. Because quite frankly, in the business, first off, everything burns, it's under pressure. You just cannot afford to lose containment. You just can't afford it. We're doing all that. Now, where it shows up is in our mechanical availability. You will see that continue to improve.
That way, the units are on stream, things aren't failing. Our mean time between pump repair is improving significantly. When you have a portfolio, you have very best, and you have things that aren't so good. All these guys over here that aren't doing so good, they can see that you can do it. You have real examples. That tends to drive it as well.
I can tell you that one of the refineries we purchased, they were shocked on how far the industry has come. It came from one of the majors, and they were shocked at the refinery to see how much improvement was really still possible in the business. So it shows up in our costs, and our costs are cash operating cost, $3.60. $0.09 a gallon is the cash operating cost.
All this rhetoric in Washington, it's not about refiners. If we're making $0.10 a gallon, or say $0.15 a gallon, $6, $7, $8 a barrel, we'd die and went to heaven. So it's not enough. But it shows up there. Operating costs are very low and competitive, and it shows up in mechanical reliability. But you as a shareholder of our company, you expect us to be all over. The point is it's not in our estimates because we budget and forecast things. But in reality, this is just a general operating improvement of the business. The expense is in our numbers, so
Folks, in the interest of time, we're going to call a close to Valero there.