Ryan Lance: No, we are not trying to message that. What I remind people is the 30% commitment that we have is through the cycle commitment. We have also signaled to or we have also told to shareholders that when prices are above our mid-cycle price, you should expect higher distributions for the company and that’s consistent with what we have done over the last number of years. So as we look today, where the strip is trading, where the regional differentials are at, we have kind of picked $11 billion at an $80 price deck. So that’s how we are going into the year. It represents about 50% of our cash flow. But again, that $80 is well above our mid-cycle price in our commitments tied to through the cycle kind of mid-cycle price call. And it just represents that we are constructive with the environment that we see today and we expect the prices to be above our mid-cycle price call, which should inform that the distributions would be above that 30% as well.
Neil Mehta: Thanks, Ryan.
Phil Gresh: Great. Thanks, Neil. Next question?
Operator: Our next question will come from Doug Leggate with Bank of America. Your line is now open.
Doug Leggate: Well, thank you. Good morning, everyone. Happy New Year guys. So Bill, I think I didn’t actually get to write down the numbers quickly enough. Could you just go through again the expected cadence of the three LNG projects? Full disclosure, I think we had expected a slower pace on Sempra or in Port Arthur, I guess. So can you just walk us through what you how you expect that cadence to look please? That would be really helpful. And I’ve got a follow-up, please.
Bill Bullock: Yes. Sure, Doug. I am happy to. So let me just kind of start with a bit of a high level view we currently bridge from 2022 to 23 in our documents for today. And I’ll just I’ll start with kind of our exit rate. So if you look at our fourth quarter base capital spend, that would annualize out to about $8.9 billion with a low single-digit inflation rate versus 22 exit rate. And we have got some phasing in Norway and the additional incremental emissions reduction that gets you to about 9.2, which is midpoint of our guidance. And then really, the incremental spend is on LNG projects in Willow and that gets us to $11 billion midpoint of the guidance range. And I think that the primary issue here on cadence is likely the front-end nature of Port Arthur LNG spend, which really the market had no way of knowing.
So as you’ll recall, Sempra has communicated a Phase 1 gross cost of $10.5 billion for the EPC, on top of which there is going to be owners costs and other miscellaneous costs to bring the project online. And Doug, the project currently lining up debt financing for a portion of the spend, so you roll that all together, we would expect our 30% share of the net equity capital to be just under $2 billion over the 5-year investment period. But the front-end nature of equity component is going to result in over half of that $2 billion occurring in 2023. That’s what we’ve included in our 2023 capital guidance. Now the project is still waiting on FID, but we do expect that in the first quarter, and we will be talking to you more about this in April.
But if you’ve been modeling a more ratable spend over 5 years for Port Arthur that would be about $400 million in 2023 or about to $600 million to $700 million less than our guidance. So I think that, that might be some of what you’re seeing in kind of the LNG spend, and I think it’s obvious with over half of the Port Arthur spend in 2023, obviously, the spending in 2024 and beyond is going to be less than a ratable rate. But I think that’s probably the main gap in LNG spending that you’re seeing.
