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#Production will be lower, <UNK>, right, because of Morris being down and the timing of that turnaround, so that's one of the things you have to factor in.
That's also going to put some pressure and impact polyethylene, as <UNK> said.
I think you will see that.
We had some maintenance and turnarounds planned work in the second quarter, so that you will probably see hold pretty even, I think, across the quarters.
We will see ethylene production being down.
We said in our prepared comments that third-quarter production loss would result in about $150 million impact for the quarter.
Yes.
Of course, with the $140 million you are considering the refinery in there.
We are in the low- to mid-$0.60 per-pound range per annual pound of capacity.
Yes, <UNK>, if you think about the improvement, probably about half of it is structural based on feedstock improvements, fixed-cost improvements and so on.
The rest is more market related.
Having said that, If you think about the European market there's really no new capacity coming.
The euro is weaker than it was two, three years ago.
We had $1.40 euro/dollar; today we're $1.10.
My sense is that Europe will kind of be an insular market.
I don't see a whole lot going out or coming in.
With no new capacity being installed in olefins and polyolefins there, and demand growing modestly but growing some, we see a pretty balanced market.
I think the operating rates ought to be reasonably high over there.
I would suspect that'll be sometime back 2018 into 2019.
Definitely not all of the derivative capacity has been announced yet, just like we are announcing today our polyethylene plant.
I think that will balance out but on paper you would assume that it's something in the back half of 2018, 2019 range.
I think the European market just has a different underpinning given the feedstock and the olefin prices there.
Our sense is that, that should continue for the first seeable future.
Propylene is a little bit ---+ (inaudible) been about flat or a little bit less than ethylene over there.
I think you've got to step back and look at global pricing as well to be instructive on that.
I suspect that some of it would need to go to Europe which would be the next logical destination.
Europe over time will probably need propylene, so I think Europe seems logical.
Of course Asia has a large need and for them it's also make versus buy because in Asia you see a lot of new PDH capacity coming.
Will have to watch that.
The thing we have to see is how much propylene export capacity there really is in the US and whether somebody would build more or not.
I don't have a fresh view on that.
Okay.
I would think Europe would be more logical destination and then next to South America.
What we see is that in a more moderate oil price environment over the medium or longer term and ethane trading somewhat above its fuel value.
Construction cost being what they are in the Gulf coast, greenfield is challenging, we think, to earn reasonable returns and perhaps our return aspirations are a lot higher.
I don't know.
So far we'd like to see how the rest of the decade plays out before we take a really firm view on that.
In the meantime, we've still got some de-bottleneck capacity that we can do.
As I mentioned, we have one more we can do at Channelview.
We are focused on PO/TBA and polyethylene.
We have pretty healthy slate of growth projects and capital projects ahead of us.
I'd like to see us execute those really well before we think about new a greenfield plant.
We have announced this next 10% buyback over 18 months.
We are on pace to be able to fund that.
Beyond that, we'll just have to see how markets develop and what ---+ our view is that we have sufficient cash flow to continue to supplement our share repurchase and so on and still engage in these growth projects.
<UNK>, I didn't know if you had anything else to add to that.
No.
We have never really given perspectively information or estimates about share buybacks.
As we have said, we have a new program approved for 10%.
We have more than $5 billion of liquidity if you look at the committed credit facility as well.
We are in a good situation to execute on the progressive dividend and on the share buyback program.
I'll start and then I will turn it over to <UNK>.
Generally speaking, our aim is to create value for shareholders.
There's a range of options you've outlined, we evaluate those.
At the end of the day, that's what we are focused on near term, midterm, long term.
<UNK>, I don't know if you want to add more to that.
No, we are evaluating the share repurchases obviously, without options.
Answering your question about how far would we go with respect to leverage, what's very important to us is to maintain a healthy balance sheet.
We are focused on the BBB-plus rating as mentioned in my initial outlines and that is clearly a very much a guiding benchmark to maintain that BBB rating through the cycle.
If there are no other questions then I will close with a few comments.
First of all, in the near term we see markets being very strong.
We see solid demand growth year over year.
Planned maintenance and some unplanned outages in the industry and our planned maintenance have kept supply moderate, so we see pretty balanced markets.
When we think about the cycle with some delays in new capacity, operating rates are not going to dip much below 90% on paper in the past.
As we see some of these delays and even some of the CTO projects in Asia being canceled, there's a higher likelihood that 2018 effective operating rates may not dip below 90%.
Our view is that we are very constructive on markets near term, medium term.
We are continuing to deliver strong earnings.
Last 12 months had a pace of nearly $10 per share, excluding LCM.
We have a strong dividend.
We're engaged in our fourth 10% share buyback program.
By virtue of those two things, we are returning significant cash back to our shareholders.
Our focus remains very consistent, safe, reliable, cost efficient operations.
We're going to finish the Corpus turnaround and de-bottleneck it by the end of Q3.
We're going continue to execute on the other turnarounds that we have.
I think what all this planned maintenance activity sets us up for is a very strong 2017.
We have very little turnaround activity in 2017.
I think that positions us well for next year.
We're starting to build out our growth project portfolio, with our polyethylene project in 2019 and potentially the PO/TBA project in 2020.
We are continuing to advance those growth projects as well.
We look forward to updating all of you on those items at our next call.
Thanks again for your interest in our Company.
