in the fourth quarter of last year. For the fourth quarter of 2021, our net income was $813 million. Excluding identified items, net income increased almost $800 million from the fourth quarter of last year. This increase was primarily driven by stronger realizations in the upstream and improved margins in the downstream and chemicals. Now if we look sequentially, our fourth quarter income of $813 million is down about $95 million from the third quarter of this year. As Brad noted, the fourth quarter results include a number of unrelated onetime non-cash charges, totaling about $160 million. Looking at each business line. The upstream recorded net income of $545 million, up $20 million from our third quarter net income of $524 million as a result of higher realizations in volumes, partly offset by higher operating expenses driven in part by mine progress spend at Kearl and higher energy costs. Upstream results included a number of onetime charges of about $85 million. The downstream recorded net income of $250 million, down $43 million from net income of $293 million in the third quarter. Downstream results included a number of onetime charges totaling around $75 million. Chemicals continue to demonstrate strong performance in fourth quarter, with net income of $64 million, down about $60 million from the third quarter this year as polyethylene prices moderated from the extreming… extremely strong levels seen in the third quarter. Moving on to cash flow. In the fourth quarter, we generated over $1.6 billion in cash flow from operating activities, an improvement of about $1.3 billion from the fourth quarter of 2020. Our free cash flow for the quarter was just over $1.2 billion. Looking at the full year, our strong results and capital discipline delivered free cash flow of almost $4.5 billion. As we start 2022, strong commodity prices, along with our continued cost and capital discipline, position us well to generate very substantial free cash flow going forward. Moving on to CapEx. Capital expenditures in the fourth quarter totaled $441 million, up from $195 million in the fourth quarter of 2020. Full year capital expenditures were in line with the revised guidance at just over $1.1 billion. Capital spending in 2021 was focused on progressing key projects, such as Kearl input tailings infrastructure and the Sarnia products pipeline. We also continued to invest in improving volumes through projects like the solvent assisted LASER project at our Mahkeses Cold Lake plant and improving the efficiency and cost structure of our operations by continuing to invest in projects like our autonomous haul truck fleet and related infrastructure, as well as installing our first boiler flue gas heat recovery unit at Kearl. In December, we announced our 2022 capital guidance at $1.4 billion, reflecting our strong ongoing capital discipline. In the upstream at Kearl, capital spending includes the ramp up of the Kearl input tailings project, ongoing investment in our autonomous truck fleet and installing additional boiler flue gas heat recovery units. At Cold Lake, we will work on developing phase one of our Grand Rapids project, continue to progress solvent assisted LASER, as well as infield drilling and well work. In the downstream, spending includes the completion and commissioning of the Sarnia products pipeline and spending on the Strathcona renewable diesel project. We will have an opportunity to discuss these plans in more detail at our investor day. Shifting to shareholder distributions. As I mentioned earlier, we generated about $4.5 billion of free cash flow in 2021. This performance supported record returns of almost $3 billion of cash to shareholders, including returns of about $950 million in the fourth quarter alone. We repurchased 17.5 million shares for $761 million in the quarter under an accelerated program, bringing our full year buyback to 56 million shares for over $2.2 billion. We paid dividends of $188 million in the fourth quarter and a total of over $700 million for the full year. Despite these record distributions, we ended the year with about $2.2 billion of cash on hand. Consistent with our previous announcement, we continued our accelerated NCIB purchases in January 2022 and completed this program on January 31st. We also declared an increased dividend of $0.34 per share, payable on April 1. Furthermore, as Brad mentioned, in light of our current cash balance and the strong business outlook, we're actively evaluating options for additional shareholder returns, including a potential substantial issuer bid. Now I'll turn it back to Brad to discuss our operational performance. Thanks, Dan. As we switch our focused operations, I would sum up the fourth quarter as being another strong quarter operationally across all business lines. In the upstream, we average 445,000 oil equivalent barrels per day, which is an increase of 10,000 barrels per day versus the third quarter, but is down 15,000 barrels per day versus the fourth quarter of 2020. This decrease year-on-year was due mainly to an early start to winter. In fact, Alberta saw several weeks of extreme arctic temperatures in the last half of December and early January, which, as you know, present some operational challenges, particularly in our mining operations. At our investor day in late 2020, we communicated our intent to focus the upstream organization's efforts on maximizing the performance of our existing asset base. And given how the assets performed in 2021, I would say, we are on that strategy in achieving it and it's also paying off for us. In fact, our full year 2021 production was 428,000 oil equivalent barrels per day, which is the highest in over 30 years and exceeded our guidance for the year. I would also note the current market environment and the strong commodity prices we are seeing. While in the fourth quarter, there were a number of factors which drove the WTI- WCS spreads wider, such as the phase startup of line three and other smaller disruptions, we are now seeing narrower spreads and are well-positioned to continue to benefit from this. So now, let's move on and talk about Kearl. Production at Kearl in the fourth quarter averaged 270,000 barrels per day growth, which was down 4,000 barrels per day versus the third quarter and 14, 000 barrels per day lower than the fourth quarter of 2020. As I mentioned, Western Canada saw an early start to winter, feeling the effects of the deep freeze that started late in the fourth quarter and extended into the new year. And as we have talked about in the past, extended periods of extreme cold weather can be challenging for our operations, and particularly, mining. The result of these weather challenges was lower than expected production in the fourth quarter at Kearl, with an estimated impact of around 13,000 barrels per day in the quarter, or just over 3,000 barrels per day on a full year basis. The impacts of the extreme cold weather continued to linger into January, but I'm pleased to say that as of now, our operations have essentially returned to normal. I would also like to take a moment to recognize the tremendous dedication of our workforce whose efforts to safely maintain our operations in these extreme conditions and mitigate the production impacts are a