DCP Midstream (DCP)

Irene Lofland VP, IR
Wouter van Kempen CEO
Sean O'Brien CFO
Shneur Gershuni UBS
Jeremy Tonet JPMorgan
Michael Bluhm Wells Fargo
Faisel Khan Citigroup
Christopher Sighinolfi Jefferies
Selman Akyol Stifel Nicolaus
Call transcript
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Good day, ladies and gentlemen, and welcome to the Third Quarter 2017 DCP Midstream, LP Earnings Conference Call. [Operator Instructions] And as a reminder, this conference is being recorded. I would now like to introduce your host for today's conference, Ms. Irene Lofland, VP of Investor Relations. Ma'am, you may begin.

Irene Lofland

Amanda. you, Thank welcome earnings and DCP third Midstream Good to XXXX call. quarter morning, the is the website Today's be webcast, being call and the Section accessed supporting Investors of dcpmidstream.com. our at under can slides

includes a factors describes I'd slide begin, for in the statements. listing differ out discussion results to Before our our the forward-looking Risk forward-looking certain business. And we Actual risk like statements. to second that use affect of that of the point please partnership's complete our deck today that to refer due latest review may Please filings. SEC Factors, the

CEO; will nearest Sean be will speakers non-GAAP GAAP turn We appendix questions. O'Brien, measures, today. the scheduled our their over remarks, I'll that, And and your reconciled the Kempen, in Wouter. take the to call slide. various we to and use measures With the will section CFO, which also of after are van Wouter

Wouter van Kempen

was giveback. as and the for DCF QX improving company, year-to-date. IDR This on our to joining $XXX quarter had and growth X.X projects $XXX end to with Thank you, of Hurricane of year-to-date. delivering million business of our integrated an on third Irene, to the On times response X.XX update million our at our EBITDA the million, of quarterly ratio We a us and DCF year-to-date with distribution Harvey, million X.XX start translates and we'll for model. puts ratio delever our no provide adjusted to We're our to and highlights. thanks, us. our our of leverage results, times I'll outstanding address about call $XXX with times quarter, QX strength coverage the you everyone, $XXX the talk today, commitment which of

of and crisis. Harvey; true the reflecting I And employees. and times to show character we team's and response believe in and did a response, their come customers. controlled interruptions customers, service. companies to not our allowed quickly of be people, proud no our were on to with our of up above our us could returning operations more by our in to surprises back Turning Hurricane proactive Ford, minimal quickly care assets I the beyond which our in very shutdown Eagle in taking We

to me Given our available of Hurricane country, logistics into demonstrating one in premier marketers allowed we Shifting the NGLs first Harvey's NGLs able project divert integrated portfolio; us execution. about portfolio, which to impact, let logistics our talk storage, to and it's our and in this minimize the our largest and redirect strategic were and Permian. of strong product position projects growth markets

capacity barrels the ramp, fourth capacity or late expect continue we record at levels at Santos, to quarter in to as went stations Our way them and We're by XXXX. on XXX,XXX service day our early into two to goes is Volumes well full XXXX running first to additional Sand into per are Hills the in quarter service. XXXX be with expansion that pump progress completing to this excellent making expect expansion QX. and

takeaway recently for Coast that Our quarter to upon transport furthering currently core business, an Express of of for gas players a a the gas needed next a agreement of we momentum X.XX Express of step-out is contracting quarter integrated Coast XXXX day an expansion our stages in project increase barrels XXX,XXX active shippers. and all the takeaway capacity per strong of logistics capabilities with with a industry exciting Gulf out will competitive announced solution this our per Permian. for by the day project year combined value really further collaboration firm our to BCF where story fee-based The on is draws is Coast important Express had provide third to Pipeline Gulf adding and We've is chain. also Gulf residue advanced DCP.

On our and X the flights O'Connor DJ the processing the Basin. X we GMP Mewbourn in house, our are of advancing side

to QX records volume in We the set ever. as continue quarter highest our with DJ volume

gathering Specifically, million quarter the XXX Plant in and Grand a Mewbourn X our day XXXX. and be service are in scheduled moving forward Parkway fourth expansion to of

our service next of production We are enable customers margin growth by in projects X this life-and-lease are everything to O'Connor to commitments. The our continued XXXX. these in is a of middle the day our fleet the minimum by Plant contracts with by both And volume to be XXX expansion accelerate doing in our timeline in and power million basin. scheduled underpinned

sight earnings line to portfolio. across We have growth project our of clear

a with we business, a taking the be recontracted, business now on step makes that back and remind few capital our have prices. strategically processing-only have logistics on model XXXX began We adjusted a of transforming DCP continues exercised significant evolved capital ago. with discipline, and We and and and discipline not focused company sharing strategy diligent gathering of from operating an continue to commodity we DCP's the been to strong to cost we up that on to do EBITDA integrated grow. higher XX% powerhouse rely projects focused accretive we've years I returns on out of want you

to financial over been the safe, quarter provide on to with they've midstream And results business to for and this team accomplished the in low-cost to reliable, are the they what journey most Harvey extremely I'll our service of Hurricane I'm provider. testament QX update. model. for Our to our a in have that outstanding leverage proud a Sean operating response our become that, turn

Sean O'Brien

trends XXXX of to towards very Thanks, segments momentum for results. comfortable strong with through pivot the despite and morning, positive guidance included We close of take of third from you the environment. very driving out strength QX we lower ranges quarter, outstanding Wouter, both the on the million. XXXX. the quarter QX we everyone. DCF year commodity our very good provided to and execution are our and I'm excited delivered Based strong $XXX

our This in second quarter will that would also earnings some minute. this would Costs and half we margins; I'm half. that the of that a are higher the on be in last we On increase call, areas, key delivering in to volumes drivers commitments. expected resulting said included these outperform lower, year unique I we would first cover proud say

continued performing on areas are volumes assets execution Our key strong well improved and in and reliability, efficiencies optimization. and

as become environment prices we continue saw to constructive. commodity Additionally, stabilize more stronger see we the and

positioned, demonstrated We by QX as uniquely results. are our

highlight that drivers several As QX mentioned our strong to I impacted results. unique earlier, want

through DCP related to property deferred GMP by financial to impact heard marketing challenging downtime we You and managed damage. results had minimal These were team's Wouter and response as discuss event. Harvey. offset the incredible pricing, this diligently maintenance, Hurricane favorable

product second and took costs of rerouting minimizing we are laser as flows able we on out our to product to customer our return lower with from proud quarter how post strong We focus were we were business on million continue affected management. as pricing Harvey. storage interruptions, of service in quickly the our than a In $XX base our benefiting drivers, focused cost areas

to be We quarter. in-line third the expect with QX costs

segment volumes reliability assets and where on The of recoveries, the the next quarter, in the further saw cost. strong where is third reflecting GMP I other we improved up details slide to our lower move by drivers significantly and strong provide will Let's segment. performance

margins, recount Ford areas DJ Mid-Continent with in. the In efficiency quarter The operate in and and addition well Eagle improved the to saw continues, significantly this the strong we increasing we reliability, perform recoveries. uptick all

that system. to Eagle the Discovery distributions in Permian, and that reduced DJ expect the This volumes scheduled to in this occurred which come where growth about continue flat Last the been our Basin Harvey the from the and growth negatively to quarter. Ford. production second volumes be wells impacts if Canyon slightly adjusting Discovery QX bear August net in significant to July, in we the results levels, during in the mentioned see equity the in due volume production year. in turnaround And QX Hurricane continued would've We volumes has of you reflected gathering showing impact, have been for Keathley QX records $XX and Harvey a In south, lower by would've earnings we out September. quarter, to impacted million from QX above investment half we QX,

Discovery to expect experience We investment continue headwinds our in XXXX.

Our latest to the that million two $XX $XX distributions million negative to XXXX. of system. Discovery to operational estimate to earnings compared into challenges is producing primarily large is continued production wells equity due and flow as the impact This from and

that will negative strong we and to continue joint be partner. coming venture offset will next situation able online management than more solid Regardless, outlook feel impact we from our on Discovery monitor earnings growth with projects the cost We volumes, with to closely will this year. base be this

volumes is filling logistics segment; added. throughput our marketing and capacity up, to and ramp continues Santos Turning record gets as to it setting

an had strong. I also quarter the as business out to marketing third outstanding this recap, looking closing To asset trajectory, continuing performance reflected year margin Our we're and outstanding the previously quarter, forward mentioned.

slide, and underscore to have I next the financial to flexibility. want we Moving liquidity that ample

good of of focused undrawn The are have leverage $XXX significant billion and cash-on-hand made XX. fully times We $X.X September and ratio on with facility. delevering progress to the bank of quarter, end as third X.X million improving had we our a bank

have and hedging ability and we're fund All Additionally, financing continue our hedged. hedge there all, Touching continually full multiple sheet flexibility, XX% year coverage. program. We're we fourth building reducing focus which Slide We manage sights X; growth. we commodity balance actively lot hedging currently a via our and quarter. strengthening on are we in XX% of XX% are on evaluate, turning in are the in we alternatives and exposure about to that confident to XXXX for to in fee is XXXX our about in reached the and fee our on our about

when of We versus of on opportunities hedges sensitivities. XX%. will margin guidance updated look XXXX additional XXXX commodity our a with market to The and layer percentage getting to we will rollout commodity be fee to target

the driven the I'll market. it over projects with NGL demand Wouter key by accrued discuss and petchem the by the takeaways. turn increased facilities relationship, that, our to from summarize encouraged of and to of are development growth export And We strengthening

Wouter van Kempen

X, growth Thanks, reviewing time strategy. capital Sean. On our spend Slide want to some I

the chain. risk terrific best provides where select we're to capital. We DJ to grow Permian on which us we value two The footprint diversified Basin to allows and integrated return. and are choices a get are have energy allocate to and across project, we have opportunity our lower offerings where tremendous where higher the which It continue great areas a providing

that doing Gulf in our major with position, processing on we're and the downstream we And very integrates important capital our is foundational allocate as Coast well our which G&P is the Express, Permian NGL opportunity connectivity and Hills, position provide the our both strategic logistics see the as to on strong to side, gathering step-up, integrated us Leveraging pipeline to Our chain. very to and Permian gas business. value via to our logistics business. Sand further first residue greatest

contracts last growth from have. are that mentioned well plants from next recovery ethane underpinned quarter, which not would what are built I the NGL and be supporting or As Sand by this with over upside take into already growing we into strong volumes dedications Hills does decade. construction, our any expansions And above existing under account

Moving as this the the of in about lowest to DJ some excited returns strongest to I'm producers. provides the and DJ for the breakeven's country Basin; talk region

are we our a the capacity. approximately Bcf underscore about integrated the With of to and next coverage QX million total in leverage X.X third bypass plans on-track These and an capital two discipline. to producer results foundation approximately strength which during chain We delivered X returns are and and times value XXX by commitments. have of times the lays very In on quarter. volume supported increase times lease XX% by X.XX system supply to It of life multiples, acreage, years. and summary, first, day minimum we We X to supported and a provides and with this have XXXX. for rest continued are this strong growing focus partnership full the our day the X.X very capacity strong new footprint lowered commitments strong over by strong processing year generated with economics, in

times in to We disciplined times this balance and earnings reliability quarter our our has better. or our as targeting financial leverage growing including our And X.X and to priorities, while efficiencies base reducing with coverage will operational distribution in business. X successful strengthening strategy been demonstrate, of sheet, X remain increasing accretively

chain growth and And DCP high predominantly The logistics integrate opportunities and that our best leverage finally, by best are fee-based our processing to our second in of great DCP and businesses. key portfolio. have our and seeing XXXX further the areas point; extends clear from differentiated we We're Midstream. multi-year we value choose line lower and our sight momentum integrated strategy risk, transforming return project the to in gathering ability

XXXX, close more expect We this towards to positive we environment. constructive strong year a shift see as sign-post we for and

Our commodity that, now, of never sustainable prices, questions. environment, flawless take to any to our to optimistic not strategy. some like I'd has [ph] wavered And on in DCP. found your for you execution at goal be ready in with but instead, thank And interest Amanda, we're market


of Instructions] Shneur And of [Operator question comes first UBS. Gershuni from our the line

open. Your line is

Shneur Gershuni

new mean gets Express would equity fund don't probably sizeable in and from wondering even the the potentially to the you're trigger flowing of, guess I waiving at by you would rewarding you for addition had need you of Sand year, this not and your bulge spend portion its restructuring liability considered online? hopefully, morning. Good the well Lately, But Hills because Kind sort because triggered have spend million, coverage it, put cash though Has market continue time to have I won't look come coverage and million; line, thinking in plans. year, imagine. of GP to the wanted trying the the CapEx? the the no-equity teams, deferring finish next two and until earlier just place, $XXX haven't as it how and distribution? funding, do the time, going forward; of of kind that lowering Do you which to but formally Coast you management the issue $XXX been results, strong off maintaining at next your on has how you the you about perspective would distribution million of you've the $XXX Gulf instead results -- accrued year, a across waiver funding. GP improve. I at the the plants same CapEx start CapEx to of too Just you, manage while a wondering, pledges

Wouter van Kempen

team Shneur, that it's Sean Wouter. and tag I question. will

or do Let me with and permanently I'm IVR there waive we -- at like, start this discussions go like and the moment, waivers no that about is not.

our is a some execution interesting our our made others, strong on we is couple Like the that more you promise you're promises. kept. comments lower deliver business we on our around in a strongly there think I continue a run is believe in of And also many to very we flexibility side. made to seeing around; continue growth. there on strategy we have where way good there not is believe significant growth, that very did funding We our distribution; model, business a we promise

haven't we know, you into As markets. equity gone the

came that's about found And okay, in done be issue other fund there to in issue, equity equity People and XXXX. significant I needed went the growth year, XXXX. for was to and this we is think into equity. you different the know, time we last ways markets many not our thinking

we believe capital we a flexibility continue within within the So have that of see. the the within amount and is to that various structure that tremendous there we portfolio, markets we have

in here XXXX continuing we've So to and way we're the executed with comfortable execute very XXXX.

Sean O'Brien

Sean. the that you divested over of is The $XXX way. Obviously, we've and raised we're I'd million some we've a on thing the $X.X on liquidity. nothing so only assets got facility; know, year cash add, this cash, Shneur, drawn we've of billion as through got sitting lot

well; our have of so lot You we flows businesses are cash our core performing a flexibility. mentioned quite from it,

I'd other is, the are the way, nice full very one As of on the Wouter line point a come growing organically said, us gives in out a we since thing timing disciplined it big doesn't capital, that of in swoop. sight of

come when We online. going have it's we line know sight, to of great

So theme. again, the that's flexibility into tying

good growth, fund we to the ability So going forward. feel really our about

Shneur Gershuni

through of unanticipated, year see issuing to at that's just yourself outside you this or some crazy So paraphrase; really 'XX? equity all event don't

Wouter van Kempen

-- commenting before, we've obviously, period But 'XX, given I in well, made we know, not sitting just very a you Unlike, You don't we're on guidance because XXXX around believe time talking -- and through that's not haven't don't said we so will about you're lengthy. equity XXXX. we're we XXXX. common that this issue

Shneur Gershuni

Okay, great.

have Just follow-ups; attributed to rigs two the more in have bottlenecks. the of down MPs DJ, some Midstream been

run year, in that concern we're all. at on that there building there later which potentially not it enough scenario help feel be online bring to activity where full all step-down come online? alleviate timing you the until type plant come ducks, don't when plants or sure into DCP is activity to a a some you the inventory of an there of therefore, obviously, plants rigs, in attributing the online any next bring enough issue, But of would fall? bottlenecks, is actually not make Could the to it that Your you and isn't I'm do there

Wouter van Kempen

there's Shneur, things keep up would me the make this list. not at definitely that night; many

continue probably little and that, to of about weren't and outer We long bring kind Mewbourn to to we to we tremendous and a and sign-up processing And XXXX Yes, mismatch in. to work capacity, it timing. place the bring the bring some capacity are chunks when that new new we've pieces could of worried rig with seeing the what Plant Basin. bypass activity small this system, I'm done capacity at there XXXX us to between used we the last last producers for it all time, same until online looking we're producers between of very at much is online capacity spoke a optimize ready online, and X time and really a timing comes But for takes the rigs. was am get volumes processing producers' my so a can things. builds they the our about permits and be really activity activity not producers in the that at things, the get rig comfortable that capacity DJ around more available today the and in the was way but efficiencies we where have, of obviously, and wish we're ourselves at earnings what there at good call

I this in think this Mewbourn we're quickly, and remarks anything get going make our we I X faster Plants; power the prepared everything that to my doing that up plant mentioned fill really is to and plant in sure can it fill up. online

of country and and is to on this the quickly we think we're develop we think DJ regions working as the producers, partnership but get trying producers, it to plant that I is I X tremendously country, that up confident are the also the to XXXX much we have to for possible. producing up very one ourselves tremendous X that O'Connor online attention this get plant areas you sure really and it area. continue low to that's talked quickly other breakeven's. very of Mewbourn as best fulfilling this going Between Basin, The making fill why quickly. the some that in in I'm Plant that And on compared doesn't

Shneur Gershuni

to given out; be next NGLs. what the just remember over Final a if million now. hedge think, a do At sensitivity, million Has sort strength in the you or time, are Is wondering XXXX. more more of number to you $X $XX right? the of of accurate? when my million that the change; in for as math I talk NGL looked I sensitivity $XX said, your for has there Does on correctly, been you it high any use, sensitivity XXs, there $X.XX can a I a that $X.XX of -- you you from changes in if is little sound, year? I sensitivity? per Great. about step-up versus guidance given us XX% If it can time question; you the said XXXX that gave bit anywhere depending change NGLs I XXXX, was mid at midpoint were

Sean O'Brien

the Shneur, higher. the right, and to we're You're was a and midpoint your $X.XX, point, about already we're $X.XX bit spot, in year-to-date

to sensitivities, terms to In -- think of you're we model the give the of rest -- 'XX we'll the reasonable are kind of 'XX you're year. utilize sensitivities, very still you that trying

we had on NGL. I million think $X

in about constructed are we you think you you that hope But when we we sensitivities set, would sensitivity hedged gone already 'XX. 'XX, of as place. hedging commodities that business environment, positive, our the there the fee-based the all XX% As tell aggressive give guidance we've gave out but has you I that really, partially overtime, I guidance in particular, as your to our put here climb. around, give I'll roll and program see for can more continue the a to you because with well. that's NGL and the obviously, we'll that and into down growth

we'll 'XX. logic numbers going bit think But pretty can't I as 'XX is into little you commodity here XX% that constructive for hedged roll going And don't already. out place. good fewer obviously, that give very signs the yet, we mentioned, it. a So year we're into your in environment of I out exact

Shneur Gershuni

you Great, much. very thank


Thank you.

line the question next JPMorgan. Tonet of Jeremy of is from Our

open. is line Your

Jeremy Tonet

to I up morning. wanted Good here. Mewbourn pick on Plant the

and much gating get Just it are could a clear that, sooner when online, the here? you have items how we picture on what wondering, possibly

Wouter van Kempen

make get plant of online. you Jeremy, I a what hundred as is -- these to mean, control; as it's from build. manpower, that we into can There But couple they're very going we can Wouter. to not them I'm easy, machines, of to quickly not we million get accelerate our this it's tell of we a lot people Wells Wells of impact. in if have warmer an Colorado, we snow, that of winter a a in obviously snow that up less we're seeing and County, little as continue days, sooner a very on very bad are outside can. to a quickly of and I couple possible. on doing all going additional that and get can the I County, the much producers to everything things anything lot here basin they're about here complex days, talking day, see But can we're unlike, wetter to you, progress. trying aligned in power trying winter tell obviously, bit adding as can means plant in how If are weather has to things, here are every we're in talk this less they a dollars,

Jeremy Tonet

thanks. talked could sense, -- release, as contributing In gas how make I us give quarter, kind of, marketing if quarter-over-quarter? That the wondering the you bit marketing that to about if quantify insight settlements some increased could as was far compared, provide a you and you

Sean O'Brien


the but storage also business, quarter-over-quarter our dollars quarter. QX will dollars. million that $XX didn't was million QX point basis NGL both huge our on they marketing M&L absolute storage, was not number a Propane of up, it were come I number and included business, pipeline, -- gas up to a downwards. includes couple it when that of about for we million perspective, an was from up quarter-over-quarter, a ground talk that those is about out, couple includes was were up segment, just this So the in remember

some you we back know, couple good have you focus about company a our $XX in that very in had cost, storage were thinking you're down, NGL online; getting the business; in million, of mention that our million pipeline that our business. business. on you drivers of dollars have cost So a reflected was laser I'll drivers

It's M&L portion overall about the marketing our Now itself; huge a a good had we business clearly talk business. not it of quarter. very

X% on and about I optimizes think the flow, think it's it considerably; our -- product but of year some is had business was and about to drivers quarter, about a makes the that only the depending million. $XX it you phenomenal basis, they this it, a was up XX% If were up movement

our the attribute to Again, I half not big as about that QX, other quarter going you that about much But to be long-term, you can business, a great to business, the driver So driver. attribute can our is the that QX versus but is other long-term, modeling half things of it a portion. you increase huge business not business a for mentioned. pipeline bigger think

Wouter van Kempen

who a really, very so. as good, and trading have there, available, marketing And are is $XX that product were in we with business But good million -- -- note, that good direct able bad going Harvey, value obviously, bit to are Hurricane margin year, was all and into project that [ph] Bellevue. example there our not unbelievably think were year, about as you and the country Bellevue your about, of here is market the a I'll put business. our million, chain probably bookends what The integrated you probably not prices in very, people was our the obviously in and make business; team able is there. optimized, to opportunistic be that able diverting our year our Jeremy, project the you few to or $XX it's that. an After to do, quarter, around in business of very and do it's about is sitting $XX strong can getting and [indiscernible] a lot to connectivity prices capability the business and people a $XX normal model that couldn't trading in million their when you things -- that's give are in And in third million

the out why pretty a processing saw those, you made and offset that's We we business what and nice side gathering where of one at saw of we some house. this are significant on offsetting dollars

Jeremy Tonet

That's helpful, thanks.

the you besides determine how could other there So there? are any money, purposes, that things like monitor marketing for share can modeling of to we examples are makes other kind or Conway/Bellevue spreads

Wouter van Kempen

Yes, go ahead, Sean.

Sean O'Brien

it's I opportunistic. mean,

and our The of able downstream remarks to to prices had Obviously, take were to other product with able were bottlenecks, into -- this we stores, spoken we pull product some thing or written of we up. that was that storage in the hurricane. related I some out moved mentioned at think remarks is the

don't indicator. also related So but that's business. see benefited one that that, you I was that another specific incident the marketing obviously, mean, always

Wouter van Kempen

think not what I you a basis, the what about of in a I really than a the year talking normalized key end, it in stellar look it business, -- in you're a normalized to material. want is, overall gave and, not kind does year there it's that $XX look on point bad huge basis, okay? the does And, DCF; trading look on like Jeremy so our look business, [ph] probably like, of, what takeaway basis of it's less million what and is it the does a is X% you that the model. and it bookends if normalized

Jeremy Tonet

I kind an update thanks next the at leverage as on agency for you, if the far like CapEx? overtime, equity far good as nice having far of as everything Sean, was you a as can which you there, and deleveraging projects the projects, different about Got and balancing business is end getting as stood funding coverage, [ph] of, needs where items And year minimize are that. of to quarter? to trying trying balance And X:X think market wondering provide how some bring to excess these great down GCX leverage this bit, but looking in DCF kind as and

Sean O'Brien


our we're progress well to three rating we've in top pure if lowering going [ph], of Jeremy, know improved made very there type I lot X:X The of agencies we obviously. -- a you that's our progress leverage. there And but bank and continued think we ratings agency, the mentioned, ratio, ratio; calculate have the you is this company improve made strong leverages So to list lower list have way leverage, for and the the -- at about a it's ways is rating you ratings so multiple that metric. pure as massive bank obviously, the focus, it

don't the goal of to rating to bank. and those X Our to get We're focus approaching the the so on sides X metrics. levels on is both equation, below on agency times we get just X to times

that's -- first accretive. on to online accretive mentioned a Hills X multiple, some year, this In that online, credit some how times got are Sand projects, accretive. incredibly you going of are to are online stuff one that really, there, coming talked driver EBITDA late about we about talked next incredibly to a year; is, we're of terms the X the credit expansions of, those get multiples that's going lot the really XX We've come that's come we've

So we're side EBIT of driving, obviously, the equation. the

side We have over Philips of lowered last that it billion focus be $X we the by the debt nature, over done of we've billion equation $X.X on few years as from and -- at a the really -- things that well. continue to with levels our

'XX push in ratings progress, down into good to while lowest and to our metrics quite bank continue and the So that trajectory goal hit continue QX, levels on metrics both, a is the 'XX. and and in we've throughout the debt here our metrics

Wouter van Kempen

multiples, really and Hills $X.X small XX to obviously, asset to And And DJ optimize well, I XX take sold or have XX we equations Jeremy, last very we in and I assets maybe we've to really, the to add that you and of shown opportunities type of over expansions billion; Sand have in were works Basin. sales to at XX money that; XX multiple that we've the done close quiver plans arrows that think non-core to mid-teens to the those think we get continued or this and invest like, that in couple portfolio. I then years,

unbelievable that the company think company. to made number progress in we're this, on ways So I and have you the that thing that that can delivering go the we we'll we focused is one center; on can different front lot has this a have and tell continue at of I team

Sean O'Brien

Wouter important Jeremy, us, and for so of because it's is proud to I are very the and something that thing, this Last quarter.

us G&P our the -- the was of continuing see cost, just focused in growth business, in got QX If the you reliability XX% non-price to help these the and majority you our in improvements And about really the the on price us our yes, saw really to think related, at a we a improvements the volumes. results, lot business, [ph] at being business M&L constructive improvement bunch. that's in G&P out guys more of in -- drive laser price when look you and but environment look

just any QX. powerful and continuing as better So I capital earnings saw our our pretty not in be leverage to you DCF you're through assets efficiencies, drive about and you're and those -- when running deploying that metrics, that think adding better and can margin and

Jeremy Tonet

That's helpful. Thanks for taking my questions.


Thank you.

Our next line Michael question from of comes the Fargo. Bluhm of Wells

Your line is open.

Michael Blum

stay Thank you. to the returns. on of wanted just the topic I

kind projects the this Slide and far are but NGL the to these than portfolio? is on total that X, on in so you generally, projects, to or that what project, your more times when earn discrete terms page on all on of number So other X X a of about for at expansions each blended the better is understand talk multiples expect of, the multiples that, of just you

Wouter van Kempen

think ones that wish it XXXX the the is multiple do; is -- XX Hills of than that Wouter we a could currently Unlike that. here. day we I a do Michael, those but other kind unfortunately, higher but are No, expansions -- I that Sand expansion, bump little all bit so are those

massively So at to into out somewhere the Hills I it XX that the is that at XX project, look one range, multiple Sand in XX is XXXX a is expansion, plans XX range. you to think are good but about XX that

stations really, is Hills the because throughout that So significant is very just which you lower projects it's expansion that get the to XXXX low bumped Sand XX of and targeting are we're portfolio capital, volume. in Xx range. relevantly all significantly

Michael Blum

gas of pipeline projects? Would the that also be true

Wouter van Kempen

would an Gulf the the well we Coast have Yes, as true the projects be in the Connector it Cheyenne DJ as also option Express gas that Permian both of Basin. on projects, in pipeline the

Michael Blum

that; follow-up returns, assume in some mentioned basically that beyond MVC contracts certain hit Okay. you of have your plants those And then to processing and return on terms do and contract. and you I to the above I that these amount question does type of or is, acreage up But guess MVC that processing new get the take-or-pay need volume a one you just the dedications; and are you level or multiple numbers? of

Wouter van Kempen

new commitments, and minimum on top acreage top X margin dedication on that on minimum about, have that, life-of-lease yes, that, Mewbourn and X, of have we're we but volume commitments. So of do talking the have we plants we O'Connor

to margins, protection of are getting to. we're minimum time very we our periods going that get So returns the that the volumes on there have, for is layers between the minimum to and ensure we us have, returns we the comfortable multiple need that that we

Michael Blum

Thank very much. Great. you


Thank you.

line is of the Khan from Faisel of Our question Citigroup. next

open. is line Your

Faisel Khan

morning. good Thanks,

you on think the the guys that call, deferred XQ. in you previous in Just that like because cost structure of, decent think on cost got talk guys did It maintenance -- of the the guys you a cycle sort about, going that through quarter, talked differing I some you reported about because in the maintenance hurricane. I looks

you I fourth this -- so forward that here. just, going is of, into structure into the I going have kind just there understand So quarter account? take what's to Is need the or cost else on introduced something

Sean O'Brien


our capital. relatively light So we're what thinking think Faisel, with maintenance is, was QX I through

and maintenance when delay we but of why had see we're as million that and turnarounds, stuff of some But QX we our thought nature, that did QX of QX normal a huge stronger, into would QX. defer Harvey mention Our little did higher, a NGL just it to we cycle. doing some up wasn't which things but couple levels, impact, get QX between dollars, and much and in overhauls maybe on capital. slightly affect lot we is catch Harvey felt lot our bit, that a QX have to to that's a was it of but wanted range, is similar we that somewhere I

million QX, $XX spent think So in I $XX we million in QX.

Faisel Khan

the and I on back processing have I spends expansion, just going just $XXX that And to sense. plants on makes $XXX million make the it, sure million, capital to right. that at want Got the Okay.

basically So, right the Is is that right to is the and it look half it? at is that half plant to facilities? the way plant say the the processing gathering

Wouter van Kempen

thumb. Yes, we're of rule to not put day that's $XXX good Yes, spending a a million just [indiscernible]. million $XXX that a it's

field extensions in turbine systems we're Grand alike the significant very [ph]. that have into putting in the like Parkway infrastructure We things systems, large and very fields the

So yes, XX-XX about looking at a good is it. of way

Faisel Khan

looking volumes across just then in different well volumes. quarter, And the throughout at the Okay. had the for regions the coming

for have the the like, in trending Permian, year it -- So been a sort now. looks down of since volumes

of because we're it confident of does like going. of then see where when if the south, clear I function volume that seeing So are around? it's it's bottom. understand, So looks -- spend sort and this sort a the stabilized So know are at and hit these not? the you what we of, decline volumes, turn to unclear point, growing still in volumes none are I or guess, trying guys hurricane where that's just And is

Sean O'Brien

see, Permian, you the of affect it So have Permian around impacts volumes to temporary, we Permian the direct; know, obviously the did some did think had didn't particular, did; of out we huge downstream, hit a normalized that's I Faisel. wasn't -- part but it the constraints here, of of limit When volumes. the couple it hurricane because normalized, it equation the the and some to in we of when and the we your the of

was that, QX. we overall normalized So it pretty for to when flat

There was we're Permian next outside flat as -- we invested the are a relatively into And in down, hopefully, where the see the areas Permian Delaware up, not still areas So year. declining move we you the of we are whole, have some money, that as see are volumes. that in but trend the and flat. we'll where continue relatively strong

hit that we day we impressive. we're have for whole, being a Ford, area Eagle But over in versus bit, normalizing now, few From see Eagle Ford the Harvey, versus right Ford up been XXX continuing a On which there. over about a around QX We low as a lows, day on. think we the impacted obviously if and a would pretty XXX we're did out the about get things QX. that that and that's up you as move we're the higher; actually close said we holding quite think the Eagle year where when right you trending

like the trends from QX, the hurricane in but Eagle noise seeing definitely, in of we the we're bit little and a Ford. So Permian the actually

Wouter van Kempen

Hills it's a only, out one integrated margins the company this chain of and are volumes are this full marketing our couple last I've is our really business, that, processing coming people, the value want let large Faisel, the of and probably to marketing of significantly. XX% Sand over of earnings a its driver volume transformed sure remind company And highly me have years. business. And we that is logistics not this gathering of company this company that the to and is business; very add make I NGL and logistics unlike that out

significantly. the volumes very be to grow there strong continue and continue So to

Faisel Khan

the where understand. to I see sounds is, trying just sort that's Sure, all the I'm definitely is It to like trend we understand trying trend if I'm these of trends get up; volumes. the -- at. in so

Wouter van Kempen

And think saying of a way good that's Yes. it. I

thing. I in operating leverage this think trend that's is up and there very is and good strong a portfolio,

Faisel Khan



Chris of Instructions] Sighinolfi Jefferies. question the [Operator is next you. Our Thank from line of

open. line Your is

Christopher Sighinolfi

or I Slide my the disclosure was Page on X. segment for of Thanks questions. I my G&P hoping understanding with morning. Good guess, begin if taking I those; refine to could X

from of You volume due benefits; XQ put million at Slide XX, look the and to volume if I $XX on they flat numbers quantified basically they around like look benefit margin are quarter-on-quarter.

that's interpretation also by quarters driven advancement volumes in Is this the into most did have I fee areas? I'm of the fee an raising is or in higher portion? know the right of So composition margin the that been [ph]. focus assuming past those you our

Wouter van Kempen

benefit you give back was importance years. have want number It so to that that re-contracting, seeing benefit you're is for about here. in trying here. company, seeing multiple DCP our to was XXXX a in you're been there so here. volumes, on It that work costs you're for you about Obviously, continue in me strategy of Let seeing to benefit was what our here. couple about it reduce a take And some I to because the we around

maintenance reliability, last couple a questions so maintenance you lower CapEx gotten of is talking years, You're have lot a over on the about about of CapEx. there guys lot

resulted a which much thing. do kind think our maintenance, While of we're trying we do it and Because great to be why? was where our maintenance, we has smarter I in deliberate, it how is about where

Over our couple maintenance years the actually is of up but we've reduced significantly. reliability spending, overall our very significantly last

benefit you spend money So the and don't fall getting better and of you because XX that's that recoveries a -- the bottom get better to straight you're kind reliability, line.

been the that So that the talking quarter. and lot leverage a you about that's about third into all quite here we've operating really saw come

Sean O'Brien

increases par a about improving of very And with area. lot then Ford in margin higher mentioned also element on that we areas talked we've of volume just a those give had -- margin. issues, a solid well. were all And price, we're it, But of course, volumes and efficiencies, just the a [indiscernible], regions like that lot high saw which in a in Wouter better color, that the of increase to things recoveries, volume a Midcontinent. was of issues; south things about that was and are maybe volumes that the Slide not benefit are drove Chris, little But you an that so reliability, Wouter's we on from more saw that you we better you on there lot dollar better Midcontinent, to talked that around the MCF per mentioned as just working driving the Eagle point,

Christopher Sighinolfi

on Wouter, quarter? trying there you to guess if what dialogue any a mechanisms your maybe protections see hear any are growth to channel? be see those pierced in on you the ceilings is, we I need margin sort here, of that before I'm volume G&P incremental in I see out we minimum sub-question guess, the I'm earlier those influence just had Bluhm. margin, there Okay, of Mike volume margin mentioned that's wondering, minimum helpful. the of with if presence I in very to that. was of

Wouter van Kempen

$XXX O'Connor Mewbourn Chris. Unlike, volumes really we're putting of margins come place No, on and X and next to and bear that in with X. the minimum capacity those million minimum

is open. on protections are those downside wide projects, upside the but those So

Christopher Sighinolfi

estimate to I just I related they or if products first, wondering if hunt percentage if -- Okay. questions, Sean it that willing was both -- you're two could, from more queue, removed of by prior are gears, saw I the Switching I it's down for guess you the I presentations. hedge to just to if -- the to from aggregate disclosure. saw percentage on trying provide can I I'm in that's product. offered calibrate number the Just something a to there? hedging

Sean O'Brien


change back numbers in we with that took numbers didn't but that think 'XX. the gave on for you Chris, QX, So them and much we'll 'XX, we I be them off those

want the we're we there to I we obviously, out do number for -- putting -- tell, 'XX. what XX% you as think can what put

pretty give didn't the a out we -- guidance is later. so our 'XX year continue number strong, until We for yet we want get preliminary environment to a

but you roll 'XX we materially they on the So right can hedging come from we them use those And QX, in-line. out numbers more then off as numbers, did take guidance. to percentages in are 'XX

Christopher Sighinolfi

then, like. And like looks about I step-up, Okay. guess one day, on looks down just about it X,XXX the pricing came follow-up a hedge question, XXXX barrels $X.XX it

the wondering, year; help just you that to in seeing earlier steepened to quarter? [ph] was added ethane any next hedges what would there is I'm mostly helpful. in put be was So going there it Was or it

Sean O'Brien

a and that in curves quite -- seeing add to able bit able been -- butane backward be and Crude NGL have and next 'XX little to around spots. love of bit unfortunately we're predominantly we is still What crude. I'd prices get has the slide propane, that in actually a that year are the the to dated; been

Chris, is lot a year. flat the -- ethane crude, and relatively backward was it's really, some that seen obviously, rest we'll get a and a continuing additional lot on propane. [indiscernible] it's to of hard butane that's quite to on, the at haven't look in something real some seen of dated, it is of maybe at benefits moved as opportunities that put we opportunities we're And seeing ethane haven't and relatively much, has -- crude GAAP But Our given we up.

Christopher Sighinolfi

taking Okay. Thanks I appreciate for lot it. a my questions.


Stifel. question line you. the of is of Thank And Selman our from next Akyol

line Your open. is

Selman Akyol

quick you, Thank ones. two

can there; long [ph], you etcetera? your option talk you about and how you will when of decide terms and Connector Shining have In

Wouter van Kempen

an do owner basically, months. we get on the option [ph], to And to basically go Shining we to decide, approval. equity commensurate probably Connector want the we when of kind project Selman, is need ferc with through XX-plus we be to what the take in approval, need to our Yes. if is that's going ferc

have we for time So that.

Selman Akyol

you just that you. scenario, remind in how recovery Got you? impact ethane terms can just then, of much And us could

Sean O'Brien

$XX and I we've previously, that given ethane, uplift, obviously out transporting million big with uplift think talked that like to anything the meaning rejection, a and barrels you're I'll so slight have so seeing Southern substantial more this less uplift, numbers, and in things we're Hills on ethane today. still those -- you're We Hills, it's that's forth. not movements, in barrels our Sand of point; decreasing still little getting million our the point baked we With But on to obviously, a don't past, have we forecast. we about includes, $XXX have, in, at

and on think analysis we've the the in positive Sand and discussions that early increased -- side, of I on just the lot that year. very via those to of rejection, Southern able projects a growth. obviously threw outside a We've Hills, been happened volumes had growth

not for a filling put to had because because using think number I getting methods. the it's we've I year potential more, if our think And around other there out we're via upside; diminished, on up next pipelines forward or I that's for that's been going million. $XX we're what's

gives in maximize always we upside, centers closer areas concentric that Permian. through we big to back a just Wouter are when the and go recovery. about much we've the us growth like definitely able assets pipelines advantage think our value still is there our So circles, to that and volume talked into the of some But been if market

value give Sand some if additional $XX range Southern on So more. us based I'd invest there could a and what had require it know number, to still I The Hills capital would that say expand to that we in gave somewhere be we but million today. to

Selman Akyol

very right, you All thank much.


the today. for over to session Q&A closing our Kempen turn for van conclude does remarks. Wouter I'd that like conference And you. back to Thank

Wouter van Kempen

Thank performance performance, And really, employee and for I first, to safe for DCP every you, quarter, great Midstream really that. thank Amanda. great thanks want at

you on everyone us. the want thank phone For for today, to joining I

between have for you Andrea, myself, obviously, Irene follow-up If Sean, and available any are question, any discussions.

terrific have day. Thanks. a So


does today's Ladies and you in conclude gentlemen, This program. thank for the conference. participation your

disconnect. now a may Everyone, have You day. great