Thank you, Operator. Good morning.

And thank you for joining us on this conference call, discussing our Fourth-Quarter and Full-year 2021 operational and financial results. On the call this morning from Gibson Energy are Steve Spaulding, President and Chief Executive Officer, and Sean Brown, Chief Financial Officer.

Listeners are reminded that today's call refers to non-GAAP measures and forward-looking information. Descriptions and qualifications of such measures and information are set out in our continuous disclosure documents available on SEDAR.

Now, I'd like to turn the call over to Steve.

Thanks, Mark, and good morning, everyone. And thank you for joining us today.

Pleased to say we delivered another solid quarter, capping what we see as a strong year especially for our infrastructure segment. As such, we're in positioned to continue a consistent annual dividend growth.

With the increase this year of $0.02 per share per quarter to $0.37 per quarter per share, or an annual amount, and a $1.48 per share. As important, we saw the restart of commercial discussions on a pause, got on by the onset of COVID, which led to the sanctions of several new projects during the year, and the development of projects we expect to sanction in 2022.

Also, we made some big strides in advancing the ESG and sustainability at Gibson. Looking briefly at our financial results.

Infrastructure adjusted EBITDA of $436 million for the year. There's a very strong result.

That $63 million or 17% increase over 2020. Also notable is if you look at the infrastructure growth, over the past five years, you see a [Indiscernible] bigger of the same amount of 17%, which truly reflects our ability to deploy capital in what we think are the highest quality projects in our sector.

On the marketing side, adjusted EBITDA of $43 million was reflective of a challenging environments. We continue to see marketing as an opportunity driven business, but we won't stretch or take additional risks just to hit a number.

Relative to 2020, our adjusted EBITDA stayed flat. But the decrease in marketing numbers was offset by higher-quality long-term cash flows from infrastructure.

In fact, infrastructure represents now 91% of our adjusted EBITDA. Despite that challenging market environment, our payout ratio of 70% remains near the bottom of our target range of 70 to 80%.

The leverage of 3.2x is within our 3.0-3.5x target range. Given our solid financial position, we'll also want to make sure we continue to adhere to our capital allocation philosophy.

Our priority remains, infrastructure growth, capital focused on high-quality cash flows, and targeting that 5x-7x build multiple. At the same time, we also recognize that many investors would also want to see increased return on capital from the sector as a whole.

As I mentioned, we increased our dividend more than any of the past years, and Sean will discuss our stock buyback strategy. On an operational front during the year, we completed the construction of the DRU on schedule and within our initial capital range.

ConocoPhillips has now been moving neat bitumen to the U.S. Gulf Coast for roughly six months now.

And they're seeing a strong market developed for their product. Also, refinery customers are seeing meaningful improvement in refinery runs versus dilbit.

All of which further demonstrates the DRU competes, if not beats pipelines on a head-to-head basis, which is helping us advanced discussions for additional phases. On the tankage front, though very pleased to announce the sanction of a new tank at Edmonton during the third quarter.

With this tank, we welcome a new investment-grade customer to our Edmonton terminal. And we continue to be in discussions, but potential Edmonton customers, including TMX shippers, we believe Gibson is well positioned to support shippers on TMX, optimize their crude net-backs, and meet stream requirements.

At the Edmonton Terminal, one of the commercial achievements of 2021 was the signing of an MSA with Suncor, our principal customer at the terminal. The agreement simplified several contracts into one contract and extended their aggregate terms.

As part of the agreement, we announced the sanction of the biofuels blending project as a roughly equivalent to 1-1.5 tanks in terms of capital, and an ESG positive and aligned with energy transition. One thing I really like is that 25-year term.

The execution of the agreement in the sanctioning of the bowl fuels project demonstrates the long-term needs of the Edmonton Terminal by one of the most prominent integrated producers in Canadian energy. We believe we'll continue to build out additional infrastructure to support their needs in energy transition fuels over the coming years.

We're dedicated to present energy transition infrastructure opportunities. We put together an energy transition team to identify and develop opportunities in the space.

Most notable is the potential renewable diesel facility that we continue to advance. If we're successful, we expect to generate very attractive risk-adjusted returns for our shareholders and likely push us back to that $300 million in growth capital per year we were at prior to COVID.

This is a very interesting opportunity. There's still a lot of work to be done.

We continue to look for M&A opportunities that fit our strategy and provide consistent and quality cash flow. It's tough to find that match where it fits your strategy, to cash flow quality, and evaluation with a willing seller.

Shifting to ESG, this is another part of our business that we meaningfully advanced in 2021. We set on each of the E fronts with deliverables in 2025, and 2030.

As we believe, it is important that we have a credible near-term targets to drive change today. And as part of that, 35% of our short-term compensation is tied to ESG and safety metrics.

We were the first public energy company in North America to fully transitioned its principal syndicated revolving credit facility to sustainability linked facility. On the east side, in terms of the highlights, we are targeting reducing our overall emissions intensity by 20% and eliminating our scope to emissions by 2030.

We've made a net zero commitment by 2050. And key focus for us, setting each of our targets with a credible path to get there.

On the S&G front, we've made some real progress over the past 12 months. We're well on our way with over 45% of our vice president and up being women or ethnic representation.

Our target is for women to comprise at least 43% of the overall workforce by 2030. We continue our focus on communities in which we operate.

We seek to give at least $5 million in community initiatives through 2025. And at least a million dollars per year, which is really pretty good when you think of our relative size.

I'm most proud of our employees, how they are contributing and participating in community investments. We had over 95% participation by our employees.

That's really outstanding. On the safety front, we achieved a trip score in 2021 of 0.43, which is a lowest score in our company's history.

And puts Gibson and that's top cortile of our U.S. and Canadian industrial peers.

Given all these efforts, we're very pleased that our work was recognized by third-party rating agencies, which provided external confirmation that we're meeting our overall goal of being an ESG leader in our sector. For example, towards the end of the year, MSCI upgraded our rating to AAA.

This is their highest rating in our sector, and we are the only company in North America to receive this leadership rating. We were also awarded the Bronze Class distinction in S&P Global 2022 Sustainability Yearbook where only 4 other companies globally received this medal of distinction within the oil and gas storage and transportation industry.

We believe we have well-positioned Gibson as a great fit for the ESG -minded investor. We have the lowest carbon intensity among our peers and the steps we've been taken have earned us very strong ratings from the major agencies.

Again, we feel we've had another strong quarter contributing to a good year. And remain very well positioned going forward.

Our infrastructure business remains strong and our run rate increasingly notable from the start-up of the DRU. We will continue to have growth opportunities around our traditional assets.

I'm excited about the new growth opportunities around the DRU. And then in the energy transition space and potentially some M&A opportunities that fit us.

It's nice to be recognized as one of the top ESG companies in our space. I will now pass it over to Sean, who will walk us through our financial results in more detail.

Sean.

Thanks, Steve. As Steve mentioned, another solid quarter that helps cap a strong year, especially for our infrastructure segment.

Very much a year that proved we don't rely on our variable cash flows to move our business forward, especially with leverage in the bottom half of our target range and our payout ratio right at the bottom of our 70%-80% target range. For the fourth quarter, infrastructure adjusted EBITDA of $106 million with slightly ahead of our expectations when taking into account that we're at a $104 million in the third quarter with what was pretty close to a full quarter contribution from the DRU.

Both the Hardisty and Edmonton Terminal s were up very slightly from the third quarter as a result of increased throughput volumes. The U.S business was also up slightly as we continue to see increased throughput on both our gathering systems and the Gibson Wink Terminal.

Partially offsetting these factors was Moose Jaw, where we are slightly lower in the fourth quarter than in the third quarter due to some maintenance work and higher utility costs. For the full-year, infrastructure adjusted EBITDA was $436 million, a $63 million or 17% increase from 2020.

That was very much above the internal budget that we set at the start of the year and was driven by outperformance at both the Hardisty and Edmonton Terminal. While there were some one-time items at both Hardisty and Edmonton on a net basis, those would account for less than half of the out-performance versus our budget outlook.

Relative to 2020, the main drivers of the $63 million increase would have included a full-year contribution from the three tanks we placed into service in the first fourth quarter of 2020 at Hardisty. The out-performance of our expectations for Hardisty and Edmonton due to higher throughput revenues and slightly lower operating costs.

The partial contribution from the DRU this year, and the net benefit of the onetime items, so that will be less than a third of the increase year-over-year. In the marketing segment adjusted EBITDA in the fourth quarter of $6 million was within our outlook range.

As we spoke to on the third quarter call, this fourth quarter was impacted by unrealized losses and financial instruments that needed to be realized. And while there is some smaller opportunities, we're able to realize around volatility from eager outages.

The asphalt market for refined products is weak as expected. The tops and drilling fluids were not as strong as anticipated.

For the full-year 2021, marketing adjusted EBITDA was $43 million. That is a decrease of $61 million from the a $104 million earned in 2020.

Putting that difference in the context though, in the second quarter of 2020, when there was significant volatility in the crude market with the onset of COVID, marketing made $64 million in just that one quarter. This also highlights both how marketing is an opportunity-driven business and that we haven't realized any outsized opportunities for six quarters in a row.

We can't predict when that quarter will come, but as you can see, it makes a big difference. In terms of our outlook for marketing, we would expect Q1 to come in at between $15 million and $20 million in adjusted EBITDA, which is somewhat in line with where Q4 came in before the impact of financial instruments.

Finishing up the discussion of the results. Let me quickly work down to distributable cash flow for the fourth quarter.

relative to the third quarter of this year. Interest and replacement capital were in line and current income tax expense was slightly lower.

Lease payments were $2 million lower, though this was offset by other items, including non-cash adjustments for equity accounted items. For the full year 2021 distributable cash flow of $290 million dollars -- $291 million was $8 million lower than the $299 million earned in 2020, despite the same adjusted EBITDA in both years.

In terms of key drivers, lease payments were $8 million lower in 2021 as we continued to reduce our railcar fleet and had reduced rates on cars we renewed. Income tax was $5 million higher, reflecting lower one-time offsets that were available.

Other items decreased a net $60 million were in the first quarter of 2020, we had an outsized positive impact of $14 million largely from adjustments from our equity investment in foreign exchange changes. And on a trailing 12-month basis for the second consecutive quarter, both adjusted EBITDA and distributable cash flow increased relative to the prior quarter.

As we again posted a stronger quarter in both the infrastructure and marketing segments than we rolled off. As a result, our payout ratio decreased to 70%, which is the bottom end of our 70% to 80% target range.

Our debt to adjusted EBITDA remained flat at 3.2 times, which is in the bottom half of our 3.0 to 3.5 times target. On an infrastructure only basis, our leverage would be 3.6 times and our payout ratio would be approximately 66%.

Where we seek to be below four times and a 100% respectively, under our financial governing principles. And it was very much those metrics, in addition to the 17% five-year CAGR, an infrastructure growth Steve spoke to earlier that gave our board the confidence to increase the dividend by $0.02 per share per quarter, or 6% to $0.37 per share per quarter on a foreign annual rate of a $1.48 per share.

And speaking further to our financial position, we continue to maintain a fully funded position for all our capital with ample cushion for additional projects. Between our credit facilities and cash on hand, we had over $650 million of available liquidity as at December 31st.

Given that level of liquidity and our strong leverage metrics, especially on an infrastructure-only basis, we're very much positioned to also consider returning capital shareholders via our buyback in 2022. We don't seek to be formulaic or prescriptive in terms of timing or size of potential buyback.

However, we fully appreciate that the market will likely judge companies on execution rather than intention. In summary, a solid quarter and a very strong year.

Results from the infrastructure segment were strong to the point where this offset the challenging environment faced by the marketing segment. From a financial perspective, we remain in a very strong position being within both our leverage and payout target ranges, remaining fully funded with ample cushion and with significant available liquidity.

And we continue to be of the view that our business offers a strong total return proposition to investors, with visibility to continued growth in our high-quality infrastructure cash flows and attractive dividend that we've now grown for 3 straight years and with the potential for buybacks in the future, all while maintaining a very strong Balance Sheet and financial position. At this point, I will turn the call over to the Operator to open it up for questions.

Good morning, everyone. First question, just on discussions on tankage, has the slippage in the Trans Mountain dates altered any conversations there or is the expectation that you are still going to have to get contracts signed this year for any tankage to the Trans Mountain?

Thank you for the question, Rob. This is Steve.

I would say it has pushed it back a little bit as far as just the pure urgency. The delay, right?

But it does actually help us on the DRU. Back, was it several years ago, when the decision around Trans Mountain was being made by the government, we'd said that we went either way.

One way -- the way we -- one way we build more tanks, the other way, it really adds to our DRU competitive advantage.

Great, thanks for that. And then just maybe shifting over, M&A got a little bit more commentary in your prepared remarks there.

As you're taking a look at the landscape, what are the attributes that you're looking for in an M&A target? Is this more asset base?

Is this more platform-based? Could we see a new geography?

Can you just kind of walk us through what you're looking for in a potential investment?

Of the number one thing that we would look at, something that looks a lot like us, right? So something in our space that we're good at, but we're not opposed to new platform is not probably our highest priority, but really a platform of the oil infrastructure business and something that we are experts at.

And geographies?

Again, now we're probably going to stay in Canada is probably our main focus. There may be some U.S assets that fit us, but -- but our main focus will be in Canada.

Appreciate the caller. Thank you.

Hi. Good morning.

Good morning, Jeremy.

Maybe rounding out that last line of questions there, just thinking about the other way. Is there any set of circumstances where Gibson might be a seller if the market doesn't realize the rate valuation?

Just kind of curious in general, your thoughts on that. We've seen some other activity in Canada in the recent past year.

I don't think we're looking to sell any assets within Canada or the U.S. So that's not really in our strategy right now.

We, as we cleaned the business up in 2018/2019, so we're not looking to really sell in the assets, Jeremy.

Or even the company as a whole, I guess if growth opportunities prove less than expected.

We're here to execute our strategy. We're pretty excited about the DRU, and the renewable diesel.

We think that's going to give us a new platform for growth. I think Sean and I and our Chairman, have always said that we're here to do what's best for the shareholders.

So we're not an entrenched management team and we want to do what's best for the shareholders. Jeremy.

Got it. That makes sense.

That's helpful there. And then maybe pivoting to a smaller part of the business and recognize the Permian is a smaller portion here, but just wondering any updated thoughts you can provide around that party of footprint, especially West Texas, drilling activities is really picked up in wondering what that means in your neck of the woods?

I mean, now we're starting to see light there. Sean talked about we increased earnings year-on-year and the budgets definitely [Indiscernible].

One of the wells that -- one of our area of dedications, they recently completed three-well pad come in at 4,000 barrels a day, has been flowing that for four months. So that's a good sign.

And we expect drilling to pick up and earnings to continue to grow, Jeremy.

Got it. But as it attracts capital, I guess no change on that front?

I think we used to say $25-$50, and I think last year we said it's going to be. Kind of south of $25, and I would say, we'll continue to be probably below $25 million in the basin for the near future.

Got it. I'll leave it there.

Thank you.

Good morning. I'll just start with capital allocation.

And Sean, I know you said you didn't want to be formulaic around the buyback parameters, but if you think about capital allocation, you've delivered the larger dividend increase and set that baseline. But on share buybacks, what are the key considerations around that?

Is it share price driven? Is it the availability of cash flow from the marketing that we are going to need to see?

Or is it CapEx? And if it's CapEx, is there then a timing bias to the second half of the year?

Thanks, Robert Kwan a good question. I mean, I think you touched upon a lot of parts of our capital allocation philosophy there.

I mean, first and foremost, we fundamentally are going to remain fully funded. So we're going to allocate growth capital to the extent that it's at that typical investment parameters, we have the extent that we have excess cash flow or we're delivering on it, we have or we said that we buy its annual dividend increases and that's what you saw with the 6 percent increase this year.

That was on the back of 17% CAGR and infrastructure growth capital over the past five years and dividend hadn't grown at that same amount with respect to buybacks and you touched upon it exactly. And it does get to the timing somewhat.

Really the two factors where we had indicated as part of our capital allocation philosophy we would think about buybacks was, if we see a significant recovery in marketing and, or we see a capital that's somewhat below our fully funded number. And so, we haven't seen that recovery in marketing, but we have seen capital numbers certainly with that a $150 million target this year, that would be below our fully funded number, and that's where we've now indicated an intention to execute on buybacks this year.

The formulaic part is probably as much about the quantum, as opposed to the timing. What I would say, is that we do have an intention to do buybacks this year.

It's not dependent necessarily on timing of capital. If you think of the total quantum of buybacks, that could be somewhat dependent as we move through the year.

If we start to sanction some of these larger projects and seed such on -- thinking additional phase of the DRU and/or the renewable diesel project, that could have an impact on the quantum, but not necessarily the timing as we do have an intention to buy back throughout the year. And then just as a point of reference from a quantum as a whole, we aren't intending to be formulaic, but as well as we think about our intention right now and we think about relative to some of the at least publicly-stated programs of our peers, we do think it will be somewhat notable.

So not pure transparency, but hopefully that answers your question.

I appreciate that, Sean. If I can just ask about the marketing.

Yeah, you've given us first-quarter guidance, is there anything unusual that you see in the first quarter or is this kind of this relatively narrow spreads lower end of your long-term range. And that's what -- at least as it stands right here, right now, what the rest of the year, might look like or is there something embedded in one that's either helping or hurting the quarter.

I think some of the volatility in December, actually carried over and helped us in the first quarter, Robert. As far as what the Rest of the year brings, it's always very difficult to find -- to predict what the year will bring.

So we don't -- we can't call the markets.

Okay. But it sounds like Q1 though is -- has been aided by decide carryover in Q4 and absent any changes in the market in the subsequent quarters, but you are probably a little bit lower than what you're guiding to for Q1.

Well, as you -- I think we've always said with the Moose Jaw margins because of our asphalt business. We don't make the money in the fourth, in the first quarter, because the actual demand drops so we store that, we store that product.

And so that really generally weakened or fourth first quarters. So we think but we have stronger Moose Jaw has stronger second third quarters.

So does offset that we believe Robert.

Okay. Okay.

That's great. Thank you.

Yeah. Thanks for taking my question here guys.

I wanted to hit the renewable diesel project, if I may. Can you outline what you need to see there, maybe on -- both federal and provincial basis from the regulators?

And then if you'd be willing to bring on other partners like indigenous groups or maybe other capital providers.

So yes, we've definitely been working with local, the provincial governments and with federal for assistance and funding of the project, and we have seen some of those come through for us already. And I would say we're definitely looking for partners in this project.

And so I would say that's probably where the bulk -- the -- were our main focus is right now, is developing those partnerships.

Thanks, Steve. [Indiscernible] be looking for LCFS manners that federal government rolls out or even Saskatchewan or what's the gating factors that we should be looking out in terms of getting capital from regulators or just in terms of what environment is constructive for continuing to push the project along?

Right now, federal would obviously give a big boost with new federal fuel standards, but currently, just with the BC standards alone, the project looks good.

Okay. thanks for that, Steven.

And then one more, if I may, talking about another DRU expansion. Last -- I mean; you had been referencing this sometime in the first half.

You're expecting or you are you still targeting that time frame, given what you've seen so far with the DRU now being in operation for a couple of months, or what's the status of commercial discussions?

Well they're definitely ongoing, but we're going to really ramp it up. So we would like to see something in the first half, it's possible, and that allows us to really start to deploy some capital this year too.

Okay, thanks. And it's still those 4 customers you're talking to, or has -- had that widen now?

Can you mention TMX delay, maybe accelerating discussions there?

Now, I think there's probably 4 or 5 customers that we're talking to now. We want to widen that spread.

So we want to get them in Gibson as soon as possible and really start to market this -- with this big integrated refinery. And widen our --

Thanks for taking my questions.

Yes.

Sorry. Yes, thanks, Steve.

Appreciate it.

Thanks. Thank you.

Hi, thanks. I wanted to go back to the cap allocation topic.

And I'm wondering the increase in the dividend of 6% up from the last two years, was that driven at all around the TMX delay in at some of these Edmonton tanks might not get sanction, and where do you want to sit on the -- your target payout range?

Thanks, Ben Pham. And I will take that.

I mean, as you know, we had our board meetings to discuss this yesterday. There's a tremendous amount of work that goes into preparing it and coming up with recommendation.

And so we had the recommendation for the 6% increase well ahead of the TMX news, coming out late last week, so absolutely no impact at all on that. We increased the dividend by 6% because we're very firmly believe in annual dividend increase.

Is something that makes sense for business like Gibson, given our stability of cash flows and given the infrastructure growth that we've seen and just the absolute strength in our business. So that's what the 6% is reflective up.

And we think that that also does differentiate us somewhat from our peers. So in short, it really had nothing to do with the TMX announcement.

And I mean, to be candid, the TMX announcement wasn't a complete surprise, I don't think to the market anyways. With respect to payout ratio range, we're comfortable within that 70% to 80%.

If you think about it, and it was in our prepared remarks, I mean, we exited last year with an infrastructure business that was over 90% of the total business, with the target leverage range of 3 to 3.5 times in the payout ratio range of 70 to 80. I think with the stability of our infrastructure business, if anything, that could be considered conservative.

We're really comfortable anywhere within that 70 to 80%.

Okay. And maybe on the share buybacks, most books were some of the benefits [Indiscernible] in there.

Is anything like on the negative ledger that you consider as you run through that allocation process?

I mean, the only very modest negative and I think as far outweighed by the benefits, would be just reduction in liquidity, where if anything, we'd like to see a bit more liquidity in our stock. But absent that, I struggle with any real negatives with a buyback.

What I like is that, in a period when growth capitals is perhaps a bit lighter than it has been historically, it allows us an avenue to remain very disciplined as we deploy that capital. Sufficient means that it's economic and it return capital to our shareholders.

So the only very, very modest negative, which again, I would think is far outweighed by the positives, would be slight reduction in liquidity. And again, that's on the margin.

That's great. Maybe one more from me is, how should we think about the [Indiscernible] guidance now, is that maybe somewhat irrelevant at this point and that maybe moving more towards CapEx deployment.

You mentioned the bowl fills 1 to 1.5 tanks, DRU is probably two tanks. Is that more relevant messaging now than just saying 2 to 4 tanks a year?

We haven't really changed our official guidance. We didn't lower down to one to two tanks a year.

But as I look forward, we're going to we're going to build out our Edmonton Terminal and build up that footprint there over the next several years with or without TMX, with another three or four tanks. So I would say we are on the lower end of one to two right now without TMX moving forward.

But it's still around Edmonton and I would say the majority of our capital is probably going to be in the DRU and energy transition moving forward.

Okay. So to clarify, you view more, the DRU and bowl fields and anything else that's on top of that tank and that's how you get to that $150 million low in CapEx?

Yes. Well, as far as this year, right?

Then I said, we hope to get back to that 300 a year again with what we're chasing.

Understood. Okay.

Thank you.

Hi. Good morning.

You've answered most of my questions, but I just wanted to follow-up on the M&A here. Is there any size of M&A that you view as being in the sweet spot?

And under what circumstances will it make sense to issue shares for M&A?

So size. We're pretty small so that does limit our size of M&A.

Robert, we announced $55 billion enterprise there. I would say we're not absolutely limited on size, but we are -- there are some certain sweet spots.

I'll let Sean really talk about the issuance. Sean.

Absolutely. Clearly, Rob, we need to be an accretive transaction.

The issue shares, I think, there is -- the size question is a good one, and there are sizes that certainly would necessitate potentially the issuance of equity. I mean, obviously that's something we'd like to avoid.

We are looking to buy back shares, not issue shares. So it would be somewhat counter to that.

But again, if an opportunity presented itself and then necessitated that, that's certainly a possibility. I mean, to the extent we needed equity capital though, there's other avenues that that can be achieved.

If we had a transaction that was a size that it did require equity, we could bring in an equity partner.

We could bring it in at the asset level. There's a numerous different avenues we could do or execute on outside of a simple issuance of shares to the extent that was required.

But I mean, just at very base principles, they would absolutely need to be accretive for us even to consider issuing equity.

Right, so not a preference, but not necessarily a limiting factor either?

No -- I mean; I think it'd be forced to have it to be an absolute limiting factor to the extent that we had an opportunity that was so absolutely strategic to the company. It's definitely something that we would need to consider.

Just a couple follow-up. My next question is more housekeeping related, but I believe payments have come down recently.

So are we now seeing really the run rate level? Are these payments you would expect to be rightsized the rail fleet?

Yes. I think that's probably a pretty safe assumption.

And then the last one is on just working capital obviously as commodity prices increase, the working capital requirements for the marketing business go up for this level of activity. So how are you viewing the working capital investment you're making in marketing or do they have access to the funds they need, or is the higher price going to limit activity at all?

What I would say is, I mean, they do have access to the funds that they need. I mean, we still have ample liquidity to support that business.

So there's no limiting factor there, but I mean, at the same time, it's something that we actively monitor and as the marketing business executes them as strategies, it's definitely a criteria that they utilize in making decision about whether or not they execute certain items. So they absolutely have access to the liquidity and the working capital, but at the same time, it's not just a blanket amount that they can access at any point.

It is part of the decision-making criteria for them, when they actually look to execute on transactions.

Yes. That's good color.

Thanks very much.

And then Rob to go back to the lease questions there. I just looking at it, if anything, I'd say we would expect leases, they could even go down probably slightly from where they are today.

Just looking at our forecast though. In a run rate right now is probably not terrible, but forecast would be they could potentially even go down slightly more.

Okay. Thank you very much.

Thank you. Good morning.

I guess the first question is probably for Sean, and it just relates to your longer-term contracts on really the infrastructure business. If you could just give us a bit more clarity and the review on revenue escalators that you have real in the drives that inflation protections within your contracts on a longer-term basis.

Thanks for that, Andrew. I think there's no perfectly generic answer.

I think every contract is slightly different, but in general, there are escalator protection or infill -- inflation protection within the contracts. And it would change by contract-by-contract.

Some of them would be more tied to CPI tech thing, and others will just simply be, call it a 2% or 2.5% escalator. So tough to completely generalize across the portfolio, but I would say the vast majority of our contracts do have inflation protection through some form of escalator.

Okay. That's helpful and then just on wage pressures, I think in your financials, you are pretty flattish on wages and benefits year-on-year but if you could maybe give us boots on the ground view of just what you're seeing whether it'd be for construction projects or just run-of-the-mill operations of the business on just what you're seeing on wage pressure.

Steve, you want to take that, or let me take it.

I mean, we haven't seen a giant impact on wage pressures yet, but I do believe it's coming. But Sean, do you have a better -- I know the biggest impact we've seen, even though it's relatively small to everybody else in the industry.

Can you just power cost? But relative to everybody else in the industry, I mean, it was up -- power costs last year was up $3 million above budget, so which is not a big thing, but that's probably the largest thing we've seen its pure impact today.

Obviously steel's up and that increases cost of tanks or any projects. But Sean.

We just haven't seen and as I hinted on the notes, it's certainly relative to others. Just -- it's not a huge factor for us if you look across our business.

We're not incredibly labor-intensive. Even on the steel side to the extent we execute on a project, we basically order this deal once we sanction the project.

So that's built into the economics. And as Steve said, the biggest unknown going into the year would be the power side, which again in totality for us is not all that material, especially relative to some of the inflationary pressures that some of our peers may or may not see.

That's helpful color and context. And then maybe if I can just sneak in one final one, and that relates to the power side of things.

And you've talked in past calls about doing some solar at various parts of the portfolio that obviously benefit the power side, but also tick the ESG box to certain degree. And then from a Canada standpoint, should it be in Canada, maybe generate offsets, I guess.

How do you sort of think about the overall management of that side of the business visit as multifaceted as the impact it has for Gibson?

We took a hard look at that and last year. And it's hard to build economical, small-scale solar power unit.

So that is definitely something that we're going to look at to meet our goals in 2025 and 2030. And especially with higher-cost accelerating.

I think those opportunities, either by ourselves or partnerships, or just power purchase agreements with renewable diesel. I may not with renewable power in the future, are going to be available.

Okay. That's great.

Thank you very much.

Thank you. I'm wondering for your renewable diesel opportunities; what ownership range you would consider.

Do you need to retain a majority interest? What would you look for in a partner beyond financing capacity?

Would it be potentially customers wanting to participate? And how would you mitigate any complexity around governance and reporting as you consider these partnerships versus what simple structure you currently have in your reporting and governance?

So we want strategic partners probably more than financial partners, Linda, and so that would either be on the upstream or the downstream side. So which would be the demand side or your downstream marketing.

The demand side itself. So we think, we have a first-mover advantage, with how far we are along in our engineering.

And we think that's probably 12 to 16 months. And front of, somebody that's just now starting to look at.

And so as far as ownership, that will really depend just on how the partnership is setup. We definitely don't have to have a governing -- a majority ownership in what we're doing.

But we'd like to have equal share. So as far as pure governance -- partnerships, we do have partnerships today.

I don't see that as an unusual thing, Linda, working within a partnership. We have our DRU or Hut or Hardisty West.

So we have numerous partnerships today.

Okay. Yeah.

I guess the reporting of that is key and appreciate the simplicity of your reporting. Maybe also just as a follow-up.

As you look to mitigate any sort of inflationary pressures and continue to stabilize your cash flows, and focus on your infrastructure business. Might there be more opportunities to revisit some of your tank agreements in terms of potentially deterioration or reassessing appropriate inflationary provisions within those agreements?

And maybe you can talk about any sort of contracts coming up for renewal soon or more broadly any sort of statistic around your current average weighted duration of agreements on your tanks?

That's a lot of questions there Linda I think Sean talked about the inflationary parts of our contracts and those are sufficient to handle the inflations on right now Linda. Again, whether it's CPI, or whether it's just a general inflation percentage that's in the contract.

We're not a high energy user at all on the power side. We don't have mainline pump.

Our pumps, just -- our pumps be mainline pumps of the Enbridge TransCanada. So we just don't have a huge power demand.

So inflation doesn't directly impact us as much as other companies. As far as contract life, I would say tanks coming up.

We have relatively -- we talked about that just yesterday actually. There's relatively few tanks coming up over the next two years for renewal.

Now, we do start to see tanks start to come up for renewal 2024 and onward. But over the next two years, we don't really see hardly any tanks.

There are some, but it's relatively small tankage contracts that are coming to term for the next couple years. Sean, do you want to add?

No. I think you nailed it.

And then, I mean, average contract life, I think that's your other question, Linda. I mean, it's probably somewhere in the 80 - ish or so range right now, so still fairly long.

I think as we've always talked about, I mean, as tanks rollover, given that it's all for operational production, our expectation is that they'll get renewed. And something like that also wouldn't take into account something like the biofuels blending project that we are going to put into service later this year, which as a reminder, is on a 25-year term.

So I guess that's all I'd add to that.

That's helpful. And just as a follow-up on some of your M&A aspirations commentary.

As it relates to crude oil, how interested might you be in extending your value chain reach into refined products, substantially, and are the opportunities that you're seeing related to our assets currently owned by producers in Canada?

So as far as refined products goes, I would say, we may reach into refined products, but the part of the refined products that will reach into isn't really on the renewable side. Not on -- not any more than what we already have at Edmonton.

As far as you produce your assets up for sale, there's always -- there's a couple of assets that we think fit us well. It's just a matter of is there -- are they a willing seller?

And our the evaluation's correct? Can we come to an adequate evaluation?

That's helpful context. Thank you.

I'll jump back in the queue.

Hey, good morning, guys. Just a quick follow-up on the DRU Phase II opportunity.

And I guess this ties into the inflation conversation, but can you just speak to any upward pressures there might be out there today on freight rates with the real companies. And I'm just thinking about that in terms of -- at the same time, we could see potentially pipeline tools come down, I guess slightly depending on the outcome of the mainline contracting process.

So I'm just curious if you had an update on the relative economics of railing Dilbit to mark good versus moving Dilbit to the Gulf by pipeline?

I would say thank you for the question, Kenny. I would say probably the biggest impact is just the cost of diesel for the fuel cost itself.

That's probably the only pressure we've seen on current rates. I would say, what's kind of the driving force there?

I would say just. It's condensate pricing is what really drives the economics around this.

And if you look at look at Mont Belvieu C5 or natural gasoline prices, and that's traded 95 to a 100% of WTI. And then you got to transport that up here.

To blend in with our bitumen to make [Indiscernible]. So that economics alone really drives us well below what the rates on pipeline are today.

Okay, I appreciate that. Thanks, Steve.

And then maybe for Sean, just to go back and clarify on the dividend growth outlook, and I appreciate it year-by-year decision process here. But would you say that the 6% is somewhat of a target here if you can continue to hit, say, the high end of your fully funded secured growth target if it is that $300 million, and maybe a more muted 3% dividend growth rate would be more tied to -- say like this year, having the target at $150?

No, I mean, I wouldn't say a couple of things there, Pat. As you know, a first, the dividend, the decision of the board that we do annually in February.

So that's what I'd open with. But I mean, no, I wouldn't say that 6% is necessarily new normal.

I mean, it'd be at a lot of factors that go into it and those were there a couple of them, how as their infrastructure growing in the previous year. We felt that fixed percent made sense given a number of factors, but also a big one being that our infrastructure is growing 17% on a CAGR basis over the last five and our dividend hasn't grown at that same level.

So it made sense to us our infrastructure only leverage ratios are certainly well below what the target is. So just a number of factors there.

If you look forward, you're absolutely right. Factors that will go into it will be, what was our infrastructure growth, what's our perspective infrastructure growth, what does our capital look like, a number of other factors.

As you noted, lighter capital program doesn't necessarily mean dividend growth because our hope is that capital program will increase the following year. So you probably don't want to underwrite a dividend increase on the back of that.

In that basis, as I talked to in one of my earlier responses, we'd probably buy share buybacks. So I wouldn't say it's necessarily the new run rate.

A lot of factors will go into the decision we'll make at this time next year.

Okay. That's great.

I appreciate that additional color. Thanks, Sean.

Well, thanks, everyone for joining us for our 2021 fourth quarter and full-year conference call. Again, I'd like to note that we've made certain supplementary information available on our website, as well as an updated corporate presentation, so please see gibsonenergy.com for those.

If you have any further questions, please do reach out to us at [email protected]. Thank you again, and thanks for your support of Gibson Energy.

Have a great day.